MAR Marriott International Inc

By Dave Sebastian

Marriott International Inc., battered from the fallout of the coronavirus pandemic, said it expects a measure of performance to decline by double digits for the first quarter amid a drought in demand.

The world's largest hotel company on Tuesday said it sees revenue per available room, a closely watched industry metric also known as RevPAR, declining about 23% worldwide for the first quarter, with the reading for March expected to be about down 60%.

The company expects RevPAR to fall about 20% in North America for the quarter. For March, Marriott said it could book RevPAR declines of about 74% in Asia Pacific--83% in Greater China and 68% in the rest of Asia--57% in North America, 71% in Europe, 57% in the Caribbean and Latin America and 56% in the Middle East and Africa.

Also on Tuesday, Marriott said it entered a new $1.5 billion 364-day revolving credit facility commitment as it seeks to maintain liquidity. The company also received a leverage covenant waiver for its existing credit facility, it said.

Although mainland China has begun reopening its economy, the outlook is still dim in other parts of the world, Marriott said. About a quarter of Marriott's some 7,300 hotels are temporarily closed, and the company expects erosion in RevPAR performance until the crisis has moderated and governments have lifted restrictions that have been in place to contain the pathogen's spread, it said.

In Greater China, where the crisis started unfolding in late January, occupancy rose in the first week of April, with the number of closed hotels declining to under 20 from more than 90 in mid-February, Marriott said. For the recent Qingming holiday weekend on April 4 and 5, Marriott said occupancy was north of 60% in more than 20 hotels in leisure-heavy destinations.

But North American occupancy levels remain at around 10%, and more than 870 hotels, or 16%, are temporarily closed, the company said. Europe occupancy also stands at under 10%, while 54% of hotels in the Middle East and Africa Region are closed. Nearly 70% of hotels in the Caribbean and Latin America are closed, Marriott said.

Shares rose 4.5% in premarket trading

Write to Dave Sebastian at dave.sebastian@wsj.com

(END) Dow Jones Newswires

April 14, 2020 09:15 ET (13:15 GMT)

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