3 Min Read
(Adds details, CEO comment, shares)
April 29 (Reuters) - Marriott International posted a better-than-expected quarterly profit as increased business travel boosted occupancy and allowed the company to raise room rates in North America.
The company, which owns the Marriott, Ritz-Carlton, Renaissance and Autograph Collection hotel brands, said comparable systemwide revenue per available room rose 6.3 percent in North America in the first quarter ended March 31.
"North American group and transient demand exceeded our expectations during the quarter, driving RevPAR (revenue per available room) and house profit margins higher," Chief Executive Arne Sorenson said in a statement.
RevPAR is calculated by multiplying a hotel's average daily room rate by its occupancy rate.
Marriott was helped also by higher business group bookings as Easter fell after the quarter ended, unlike last year when the holiday hurt business bookings in the March quarter.
Group business refers to a block of room bookings as well as catering and banquet services for group events such as meetings or social functions.
Marriott's average daily room rate rose 3.3 percent to $141.66 across its properties in North America.
The company's international comparable systemwide RevPAR rose 4.4 percent in actual dollars.
Rival Starwood Hotels & Resorts Worldwide Inc, owner of the Sheraton and Westin brands, reported on Thursday a 5 percent fall in RevPAR in actual dollar terms in Asia, excluding China, due to a strong dollar.
Marriott has not been affected much by the strong dollar as just 23 percent of its hotel rooms are outside the United States.
The company's net income rose to $172 million, or 57 cents per share, in the first quarter from $136 million, or 43 cents per share, a year earlier.
Revenue rose 5 percent to $3.29 billion.
Analysts on average had expected a profit of 51 cents per share on revenue of $3.30 billion, according to Thomson Reuters I/B/E/S.
Marriott's shares closed at $56.62 on the Nasdaq on Tuesday. (Reporting by Ankit Ajmera in Bangalore; Editing by Kirti Pandey)