Marriott International(US:MAR)2023-02-13 16:00Company Operations - At year-end 2022, the company operated 2,053 properties with a total of 576,243 rooms[11]. - The company had 6,122 franchised and licensed properties, totaling 937,683 rooms and timeshare units[15]. - The company operates in two segments: U.S. & Canada and International, which are separately disclosed[11]. - At year-end 2022, Marriott operated a total of 8,288 properties with 1,525,407 rooms globally[23]. - The company had 113 branded residential communities, comprising 11,481 residential units at year-end 2022[16]. Brand Portfolio - The company’s Classic Luxury brands include JW Marriott, The Ritz-Carlton, and St. Regis, while Distinctive Luxury brands include W Hotels and The Luxury Collection[18]. - The company’s Classic Premium brands include Marriott Hotels and Sheraton, with a total of 205,443 rooms across these brands[19]. - The company’s brand portfolio is categorized into three quality tiers: Luxury, Premium, and Select[19]. - The company emphasizes the importance of its brand names and trademarks in a highly competitive industry[17]. Financial Performance - Total revenues for 2022 reached $20,773 million, a significant increase from $13,857 million in 2021, representing a growth of approximately 50%[184]. - Net income for 2022 was $2,358 million, compared to $1,099 million in 2021, marking an increase of about 114%[187]. - Earnings per share (EPS) for 2022 were $7.27 (basic) and $7.24 (diluted), up from $3.36 and $3.34 in 2021, reflecting a growth of approximately 116%[184]. - Gross fee revenues for 2022 totaled $4,078 million, a 51% increase from $2,694 million in 2021[184]. - Operating income for 2022 was $3,462 million, compared to $1,750 million in 2021, indicating a growth of about 98%[184]. Loyalty Program - Over half of Marriott's global room nights in 2022 were booked by Marriott Bonvoy members, indicating strong loyalty program engagement[24]. - The company recognized $2,692 million in revenues from the Loyalty Program during 2022, with deferred revenue of $6,594 million as of December 31, 2022[180]. - The complexity of accounting for the Loyalty Program involves high volumes of data and significant judgment in estimating the standalone selling price per point and breakage[180]. - The company recognized revenue for Loyalty Program points as they are redeemed, which involves complex models and estimates[180]. Sustainability and Social Impact - The company has committed to set a near-term science-based emissions reduction target and aims for net-zero value chain greenhouse gas emissions by no later than 2050[44]. - The company is focused on sustainability through initiatives that include designing resource-efficient hotels and increasing the use of renewable energy[44]. - The company has established a platform called Serve 360, which includes four focus areas to drive sustainability and social impact through 2025[43]. - The company aims to support the resiliency and sustainable development of the communities where it operates[43]. Human Capital Management - The company managed approximately 377,000 associates at year-end 2022, including 140,000 directly employed by Marriott[34]. - Marriott's associate engagement scores exceeded external benchmarks in 2022, reflecting a strong workplace culture[36]. - The company focuses on human capital management includes leadership development and comprehensive benefits to enhance associate satisfaction[39]. - The company aims to achieve global gender parity at the Vice President level and above by the end of 2023, and increase the representation of people of color at the same level in the U.S. to 25% by year-end 2025[41]. Financial Position and Debt - The company reported total carrying amounts for fixed-rate debt at $(8,523) million and floating-rate debt at $(1,402) million[156]. - Long-term debt remained relatively stable at $9,380 million in 2022, compared to $9,333 million in 2021[189]. - Total long-term debt at year-end 2022 was $10,064 million, a decrease from $10,138 million at year-end 2021[298]. - The company paid cash for interest of $345 million in 2022, down from $391 million in 2021[298]. Audit and Financial Reporting - The company's internal control over financial reporting received an unqualified opinion from Ernst & Young LLP as of December 31, 2022[175]. - The audit included testing the operating effectiveness of controls over the accounting for reimbursed expenses and general and administrative expenses[182]. - The audit procedures included evaluating management's assumptions and testing the underlying data used in estimating breakage of Loyalty Program points[180]. - The company’s financial statements were audited in accordance with PCAOB standards, ensuring reasonable assurance about the absence of material misstatements[177]. Acquisitions and Investments - The company announced an agreement to acquire the City Express brand portfolio for $100 million, which includes 152 mid-scale hotels (17,356 rooms) across Mexico, Costa Rica, Colombia, and Chile[248]. - The acquisition of City Express is expected to close in the first half of 2023, pending regulatory approval and customary closing conditions[248]. - The company evaluates investments for impairment based on significant underperformance relative to historical or projected operating performance[230].