- The Washington Times - Monday, February 10, 2003

WASHINGTON, Feb. 10 (UPI) — Marriott International Inc. said its fourth-quarter loss narrowed to $37 million, or 15 cents a share, from a loss of $116 million, or 48 cents a share during the same period a year earlier when the hotel industry suffered in the aftermath of the Sept. 11, 2001, attacks.

The hotel operator noted the prior year's quarter was one week shorter.

Marriott also said earnings for 2003 would decline from its previous estimates, with room revenue essentially unchanged from 2002, because demand remains soft. It also said it has made a deal to sell a 50 percent stake in its synthetic fuels business, in which it had invested as a tax shelter.

The company said it recorded a loss on the disposal of its distribution services unit and a loss associated with its senior living services business, which it is selling.

Adjusting for those and other items, Marriott said it had posted a profit of 55 cents a share in the latest quarter, compared with 22 cents a share a year earlier. The results this year included 14 cents from its investment in a synthetic fuels business.

On that basis, analysts on Wall Street had expected the company to report a net income of 54 cents a share, according to research firm Thomson First Call.

Revenue rose to $2.68 billion from $2.14 billion a year ago, with room revenue in North America rising 7.4 percent and outside North America rising 13.9 percent.

J.W. Marriott Jr., chairman and chief executive officer, said, "We are pleased with the relative strength of our lodging profits and cash flow, despite the toughest demand environment our industry has ever seen."

The company also said it has signed an agreement to sell an approximately 50 percent ownership interest in its synthetic fuel operations to a major U.S. investment bank.

The sale, which is subject to certain contingencies, including the receipt of a satisfactory private letter ruling from the Internal Revenue Service regarding the new ownership structure, is expected to close later in the year.

Looking ahead to 2003, Marriott said it now expects earnings from continuing operations of $1.85 to $1.95 a share, compared with its earlier estimate of $2.05 to $2.15 a share. Analysts were expected results of $2.01 a share.

In the first quarter, the company said comparable room revenue should drop 3 percent from a year earlier, with earnings of between 36 cents and 40 cents a share. Analysts had been expecting 42 cents a share.

Marriott International currently operates approximately 2,600 lodging properties in the United States and 66 other countries and territories.

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