Marriott Predicts Coronavirus Will Hurt Fee Revenue
February 26 2020 - 5:56PM
Dow Jones News
By Dave Sebastian
Marriott International Inc. expects the coronavirus epidemic to
weigh on its fee revenue in 2020, as the pathogen's spread outside
of China stokes fears and disrupts travel.
The world's largest hotel company said Wednesday that it could
have about $25 million less in fee revenue per month this year,
compared with its outlook, assuming current low occupancy rates in
the Asia-Pacific region continue.
Excluding the epidemic's effect, Marriott predicted 2020
comparable systemwide revenue per available room, an industry
metric that measures performance, on a constant-currency basis to
be flat to up 2% world-wide, with its rise in North America to be
in the middle of the range. The company expects global room growth
of 5% to 5.25%, and gross fee revenue to rise 4% to 6%, compared
with 2019.
The Bethesda, Md.-based company, which has roughly 7,200
properties, expects earnings of $6.30 a share to $6.53 a share for
the year, on gross fee revenue of $3.96 billion to $4.04
billion.
Companies with high exposure to travel and tourism have borne
the brunt of the epidemic, with hotels closing some operations,
airlines canceling flights, cruise ships becoming incubators for
the pathogen and casinos closed off for two weeks in the gaming
enclave of Macau.
Originating in the central Chinese city of Wuhan, the epidemic
has widened globally, with cases recently surging in South Korea
and Italy and new infections diagnosed in Brazil, Spain, Germany
and Switzerland.
(END) Dow Jones Newswires
February 26, 2020 17:41 ET (22:41 GMT)
Copyright (c) 2020 Dow Jones & Company, Inc.
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