Marriott International Inc. said yesterday that a surge in per-room revenue resulted in stronger-than-expected third-quarter earnings.
The Bethesda-based hotel operator reported net income of $110 million, or 43 cents a share, a 15 percent increase over the $96 million, or 36 cents a share, for the third period last year. Marriott's sales rose 15 percent to $2.3 billion from $2 billion in the quarter, which ended Sept. 8.
Analysts polled by First Call/Thomson Financial had forecast average earnings of 42 cents per share. "The industry had very good numbers," said Paul D. Puryear, a senior analyst at Raymond James and Associates in St. Petersburg, Fla. "And Marriott outperformed the industry, which they usually do."
J. W. Marriott Jr., the company's chairman and chief executive officer, said the results reflected a record level of business and leisure travelers staying in Marriott hotels over the summer. The company said results were particularly strong in Boston, New York, Chicago and California.
Average revenue per room at all Marriott brands rose 8.5 percent, while occupancy rates among its full-service lodging brands, which include Marriott, Renaissance and Ritz-Carlton, increased more than one full percentage point to 79.7 percent.
Puryear said Marriott's revenue per available room rate, which is one of the benchmarks of a hotel's financial performance, was higher than he expected. He, too, attributed the growth in Marriott's business to the thriving economy.
Marriott also said yesterday that it would sell four hotels for $274 million to a new joint venture between Marriott and Blackacre Capital Management.
So far in 2000, Marriott has sold 34 hotels and senior living communities, yielding $654 million.
Marriott operates and franchises hotels under its own brand name as well the Renaissance, Ritz-Carlton, Residence Inn, Courtyard, TownPlace Suites, Fairfield Inn, SpringHill Suites and Ramada International brand names.