In what can't be considered a great surprise, hotelier Marriott International (NASDAQ:MAR) has withdrawn the guidance for its current 2020 fiscal year. The reason, of course, is the sudden and sharply deleterious effect of the SARS-CoV-2 coronavirus, and the COVID-19 disease it causes, on the hospitality industry.
Previously, Marriott had provided "base case" guidance -- i.e., estimates that don't take into account the potential impact of the coronavirus's spread and other costs that are challenging to forecast -- for 2020.
This guidance anticipated revenue per available room (RevPAR, a key sales metric for hotels) would show flat to 2% year-over-year growth, with growth in fee revenue outpacing this at a 4% to 6% clip. Marriott also forecast a per-share net profit of $6.30 to $6.53. On a non-GAAP (adjusted) basis, that figure for fiscal 2019 was $6.
In its latest communication, Marriott also gave some detail about its fundamental performance so far in 2020. RevPAR declined notably in Asia due to the coronavirus outbreak; this was not compensated by single-digit gains in the company's other geographies.
But the crisis is now hitting some of those regions. Marriott said that recently, its lodgings in the crucial North America and Europe markets had seen occupancy rates of less than 25%. One year ago, that figure stood at roughly 70%.
On Thursday, despite its gloomy news, the top hospitality stock essentially rose in price along with the major market indexes by rising nearly 5% on the day.