Marriott Int'l (MAR) is projecting "messy" upcoming financial quarters but expects its recent $13 billion purchase of Starwood Hotels & Resorts Worldwide to drive higher revenues, CEO Arne Sorenson said this morning during the hotel company's third quarter earnings call.
After yesterday's market close, the Maryland-based company reported 2016 third quarter adjusted earnings of 91 cents per diluted share on revenue of $3.77 billion, compared year-over-year to earnings of 78 cents per diluted share on $3.58 billion in revenue. Analysts surveyed at FactSet expected Marriott to post third-quarter earnings of 89 cents per share on $4 billion in revenue.
Shares of Marriott rose $2.51, a 3.52% increase, to $73.61 in today's early afternoon trading.
On Sept. 23, Marriott closed on its acquisition of hotel and leisure company Starwood. The company's earnings report shows Marriott spent $228 million in the third quarter in costs related to the $13 billion transaction.
Sorenson said further transaction and transitional costs for 2016 and 2017 are "a bit difficult for us to predict at this time." The operator, franchiser and licensor of hotels and timeshare properties is working on sealing various other deals that are currently delayed.
"We have a range of pipelines we're looking at overwhelmingly," Sorenson said. "The deals continue to move forward but are pushed out. They are taking a bit longer to put together."
Sorenson said the company will continue to transfer membership programs and transition Starwood and Marriott management in the fourth quarter, adding that the 3.3 billion points transferred already through programs "did not go unnoticed."