0 Replies Latest reply: Feb 15, 2011 7:48 PM by anadyr RSS

Divorce-Marriott style

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Barrons reports today that the financial markets seemed happy with the Marriott decision to divorce itself from the timeshare business at the end of 2011.

 

"Because the timeshare unit is not a large part of the business, the split won't be transformational, but it will allow the company to detach itself from a business that continues to lag despite the uptick in travel. While Marriott gets the lion's share of its revenue from business travel, which has recovered well, timeshare units are still a hard sell, with waffling consumer confidence and much stricter mortgage standards.

 

Therefore, by spinning off the division, Marriott will be able to focus more fully on its main lodging business.

 

This business has certainly been strong, as evidenced by the fourth-quarter results. Revenue per available room, or RevPAR, increased 6.5% in the quarter from the year-ago period, after a 9% increase in the third quarter. Occupancy rates increased 2.5%, to more than 65%. Average daily rates also rose 2.5% to $147.60."

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