Marriott’s profits fall 67% amid Starwood merger costs
Marriott International’s profits plunged 67% to $70m (£56.4m) during the third quarter of 2016, due to costs associated with its acquisition of Starwood Hotels & Resorts.
The company’s latest financial results for the third quarter of the year ending 30 September said merger-related costs and charges totalled $228m (£183.8m), as the deal created the world’s largest hotel company with more than 1.1m rooms across 30 brands in 110 countries.
Total revenue for the company increased 8.3% from $3.6bn (£2.9bn) for the third quarter of 2015 to $3.9bn (£3.1bn).
Comparable dollar revenue per available room (RevPAR) for the combined group increased 2.2%, however Marriott said this figure is likely to decline to less than 1% in the fourth quarter of the year.
Arne Sorenson, president and CEO of Marriott International, said Marriott was “thrilled” to close the acquisition of Starwood in late September.
He added: “We are enthusiastically engaged in welcoming Starwood’s associates around the world into the Marriott family and [we] are working diligently on integrating the companies and realising revenue and cost synergies as quickly as possible.
“The day the acquisition closed, we offered status match to our more than 85 million combined loyalty members, along with the ability to transfer and redeem points between Marriott Rewards, which includes The Ritz-Carlton Rewards, and Starwood Preferred Guest, the industry’s leading loyalty programs.”
Marriott now has a worldwide development pipeline of bedrooms 420,000 rooms across 2,454 hotels.
