Marriott International Sets Sights on Robust Growth and Profit Expansion in 2024
Marriott International has laid out its financial and operational roadmap for 2024, signaling a year of strong development and substantial returns for its shareholders. During its earnings review conference call on February 13, the hospitality giant shared optimistic forecasts for the first quarter and the entirety of 2024, underpinned by its significant growth in property development and strategic plans to enhance shareholder value.
Unprecedented Expansion in 2023 Paving the Way
In 2023, Marriott achieved remarkable growth by adding 558 properties to its portfolio, which introduced over 81,000 new rooms. This expansion brought its global footprint to nearly 8,800 hotels and resorts, encompassing more than 1.59 million rooms. This aggressive growth trajectory is set to continue into 2024, with Marriott reporting a substantial pipeline of 3,379 properties in development, over a thousand of which are already under construction. This represents 41 percent of its development pipeline, indicating a significant commitment to expanding its global presence.
Forecasting a Bright 2024 with Strong Revenue and Profitability
A key highlight from Marriott’s 2024 outlook is the anticipated growth in revenue per available room (RevPAR), a critical performance metric in the hospitality industry. Marriott projects a 4-5 percent increase in RevPAR for the first quarter of 2024 compared to the same period in 2023, with expectations for a 3-5 percent growth rate throughout the year. This positive forecast is supported by a robust development pipeline, which is expected to drive net rooms growth of 5.5 to 6 percent over the year.
Such growth is not just in terms of physical expansion but also financial performance. Marriott anticipates this momentum will lead to an adjusted EBITDA of between $4.9 billion and $5 billion for 2024. The company’s strategy aims not only to bolster its operational success but also to significantly reward its shareholders, with plans to return $4.1 to $4.3 billion within the year. This ambitious shareholder return plan includes the allocation of $500 million towards the acquisition of the Sheraton Grand Chicago, further expanding Marriott’s luxurious and diverse portfolio.
Leadership Optimistic About Sustainable Growth
Anthony Capuano, President and CEO of Marriott International, expressed confidence in the company’s strategic direction for 2024, emphasizing the expectation of solid growth and significant shareholder returns. With RevPAR growth normalizing globally, the anticipated increase in worldwide full-year RevPAR and net rooms growth underscores the company’s robust operational and financial health. This growth, coupled with Marriott’s commitment to shareholder value, illustrates the company’s resilience and strategic foresight in navigating the dynamic hospitality landscape.
Marriott International’s 2024 outlook highlights its strategic focus on expansion, operational efficiency, and shareholder returns. With a significant development pipeline and optimistic financial projections, Marriott is poised for another year of strong growth and profitability, solidifying its position as a leader in the global hospitality industry.