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October 6, 2010

Marriott International Reports Third Quarter 2010 Results

BETHESDA, Md., Oct 06, 2010 /PRNewswire via COMTEX News Network/ -- THIRD QUARTER HIGHLIGHTS

Marriott International, Inc. (NYSE: MAR) today reported third quarter 2010 results, exceeding prior year results and at the high end of the company's expectations.

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THIRD QUARTER 2010 RESULTS

Third quarter 2010 net income totaled $83 million, a 57 percent increase compared to third quarter 2009 adjusted net income. Diluted EPS totaled $0.22, a 47 percent increase from adjusted diluted EPS in the year-ago quarter. On July 14, 2010, the company forecasted third quarter diluted EPS of $0.18 to $0.22.

Adjusted results for the 2009 third quarter exclude $8 million pretax ($4 million after-tax and $0.01 per diluted share) of restructuring costs and other charges, as well as $752 million pretax ($502 million after-tax and $1.41 per diluted share) of impairment charges related to the Timeshare segment. Adjusted results for 2009 third quarter also exclude the $13 million ($0.03 per diluted share) impact of non-cash charges in the provision for income taxes.

Reported net income totaled $83 million in the third quarter of 2010 compared to the reported loss of $466 million in the year-ago quarter. Reported diluted EPS was $0.22 in the third quarter of 2010 compared to reported diluted losses per share of $1.31 in the third quarter of 2009.

J.W. Marriott, Jr., chairman and chief executive officer of Marriott International, said, "We are having an outstanding year. Corporate and leisure demand continues to strengthen, and we are leading the U.S. industry in pushing retail price increases. For the Marriott Hotels and Resorts brand in North America, nearly 90 percent of hotels raised corporate retail rates in the quarter and, overall, such retail rates rose 9 percent.

"In the third quarter, revenue per available room at North American systemwide hotels rose 7.2 percent year-over-year and average daily rates rose nearly 2 percent. International systemwide hotels showed tremendous strength, with REVPAR up 12 percent in the quarter on a constant dollar basis. Our Asia Pacific region is leading the way with REVPAR up over 20 percent. China was especially strong with our hotels benefiting from favorable demand, strong brands and outstanding locations.

"While U.S. supply growth continues to moderate, we are adding hotels to our portfolio. During the third quarter, we opened over 5,000 new rooms, and we have nearly 95,000 rooms in our worldwide development pipeline at quarter-end, including the stunning 3,000 room Cosmopolitan Hotel in Las Vegas - our first hotel on the Strip - which will open in December as part of The Autograph Collection. Our pipeline also includes almost 7,000 rooms to be converted to our brands.

"With substantial unit growth, improving REVPAR and continued focus on the bottom line, our strong cash flow has enabled us to reduce our debt ahead of schedule. Our adjusted net debt has declined by almost $1.5 billion since the end of 2008. We are pleased that Standard & Poor's upgraded our bond rating to BBB last week.

"We expect 2011 to be even better than 2010 as demand and pricing continue to strengthen. We are currently forecasting 2011 systemwide worldwide REVPAR to increase 6 to 8 percent. We also expect to open 25,000 to 30,000 rooms worldwide in 2011."

For the 2010 third quarter, REVPAR for worldwide comparable systemwide properties increased 8.2 percent (a 7.5 percent increase using actual dollars).

International comparable systemwide REVPAR rose 12.0 percent (an 8.5 percent increase using actual dollars), including a 1.6 percent increase in average daily rate (a 1.6 percent decrease using actual dollars) in the third quarter of 2010.

In North America, comparable systemwide REVPAR increased 7.2 percent in the third quarter of 2010, including a 1.7 percent increase in average daily rate. REVPAR for comparable systemwide North American full-service and luxury hotels (including Marriott Hotels & Resorts, The Ritz-Carlton and Renaissance Hotels) increased 7.3 percent with a 2.6 percent increase in average daily rate. The company estimates that excluding the impact of the calendar shift of Rosh Hashanah from the 2009 fiscal fourth quarter to the 2010 fiscal third quarter, REVPAR for comparable systemwide North American full-service and luxury hotels would have increased nearly 8 percent.

Marriott added 32 new properties (5,056 rooms) to its worldwide lodging portfolio in the 2010 third quarter, including the Renaissance Tianjin Lakeview, the Ritz-Carlton Shanghai Pudong and the 457-room Courtyard Shanghai Puxi. Three properties (667 rooms) exited the system during the quarter. At quarter-end, the company's lodging group encompassed 3,518 properties and timeshare resorts for a total of over 611,000 rooms.

The company's worldwide pipeline of hotels under construction, awaiting conversion or approved for development totaled almost 575 properties with nearly 95,000 rooms at quarter-end.

MARRIOTT REVENUES totaled over $2.6 billion in the 2010 third quarter compared to approximately $2.5 billion for the third quarter of 2009. Total fee revenue rose 9 percent to $253 million reflecting higher REVPAR and fees from new hotels. Third quarter incentive management fees alone increased 24 percent to $21 million. In the third quarter, 23 percent of company-managed hotels earned incentive management fees compared to 20 percent in the year-ago quarter. Incentive management fees largely came from hotels outside of North America in both the 2010 and 2009 quarters.

Worldwide comparable company-operated house profit margins increased 90 basis points in the third quarter reflecting higher occupancy, rate increases and strong productivity. House profit margins for comparable company-operated properties outside North America increased 170 basis points and North American comparable company-operated house profit margins increased 30 basis points from the year-ago quarter. Excluding the impact of cancellation and attrition fees in the 2009 quarter, North American comparable company-operated house profit margins increased 60 basis points year-over-year.

Owned, leased, corporate housing and other revenue, net of direct expenses, declined $5 million in the 2010 third quarter, to $7 million, largely due to the impact of a $6 million cancellation fee recorded in the 2009 third quarter.

The company launched Marriott Vacation Club Destinations, a new North American timeshare points program, in June and focused its efforts on educating existing customers about the benefits of the new product. The program allows customers to purchase timeshare in smaller increments than the traditional one-week product and allows greater flexibility of use. Feedback from owners has been favorable. In the third quarter alone, 22,000 existing owners joined the points program, exceeding the company's expectations, and many of those owners purchased additional product. In fact, contract sales to existing owners increased 27 percent in the third quarter. With fewer sales to new customers year-over-year, third quarter adjusted Timeshare segment contract sales decreased 6 percent to $165 million (excluding a $1 million allowance for fractional contract cancellations recorded in the quarter). In the prior year's quarter, Timeshare segment adjusted contract sales totaled $176 million (excluding a $24 million allowance for fractional and residential contract cancellations).

In the third quarter, Timeshare sales and services revenue totaled $275 million and, net of expenses, totaled $56 million for the quarter. Adjusting for the Timeshare impairment and restructuring costs and other charges, as well as the impact of consolidating securitized loans had that occurred at the beginning of 2009 rather than 2010, third quarter 2009 timeshare sales and services revenue would have totaled $290 million and, net of direct expenses, would have totaled $45 million. These adjustments for the 2009 quarter are shown on page A-11.

Third quarter 2010 Timeshare sales and services revenue, net of expense, benefited from lower marketing and sales costs, price increases year-over-year, and a $15 million favorable adjustment to the Marriott Rewards liability resulting from the lower than projected cost of Marriott Rewards redemptions. Results were reduced by $6 million of incremental program costs and $11 million of deferred profit associated with lower reportability of contract sales, both related to the new points-based program.

Timeshare segment results include Timeshare sales and services revenue, net of direct expenses, as well as base management fees, equity in earnings (losses), gains and other income, noncontrolling interest, interest expense and general, administrative and other expenses associated with the timeshare business. Timeshare segment results for the 2010 third quarter totaled $37 million as shown on page A-9. In the prior year quarter, adjusted Timeshare segment results would have totaled $24 million, adjusting for the Timeshare impairment and restructuring costs and other charges, as well as the impact of consolidating securitized loans had that occurred at the beginning of 2009 rather than 2010, as shown on page A-11. Timeshare segment results for the 2010 third quarter included $12 million of interest expense related to the consolidation of securitized Timeshare notes. Adjusted Timeshare segment results for the year-ago quarter included $17 million of interest expense related to the consolidation of securitized Timeshare notes.

GENERAL, ADMINISTRATIVE and OTHER expenses for the 2010 third quarter increased 4 percent to $149 million, compared to adjusted expenses of $143 million in the year-ago quarter, and included higher incentive compensation and legal costs, partially offset by lower deferred compensation expenses and the favorable reversal of an accrual related to a tax settlement on a European asset.

GAINS (LOSSES) AND OTHER INCOME totaled $3 million, primarily reflecting gains on the sale of real estate. The prior year's third quarter losses totaled $1 million and included a $5 million impairment charge on an investment partially offset by $3 million of gains on the sale of real estate and $1 million of income from cost method investments.

INTEREST EXPENSE increased to $41 million in the third quarter primarily due to $12 million of interest expense related to the consolidation of debt associated with securitized Timeshare notes, lower capitalized interest and higher interest expense associated with the company's deferred compensation plan, partially offset by the impact of lower debt balances and lower interest rates. Adjusting for the impact of consolidating securitized loans had that occurred at the beginning of 2009 rather than 2010, third quarter 2009 interest expense would have been $44 million.

EQUITY IN (LOSSES) totaled a $5 million loss in the quarter compared to an $11 million adjusted loss in the year-ago quarter. The $6 million improvement in results primarily reflected lower losses in two joint ventures, as well as the favorable impact of the impairment of one investment in the year ago quarter.

Earnings before Interest Expense, Taxes, Depreciation and Amortization (EBITDA)

EBITDA totaled $220 million in the 2010 third quarter. In the 2009 third quarter, adjusted EBITDA totaled $163 million. If the consolidation of securitized Timeshare notes had occurred at the beginning of 2009, adjusted EBITDA in the 2009 third quarter would have totaled $195 million.

BALANCE SHEET

At the end of the third quarter 2010, total debt was $2,726 million and cash balances totaled $223 million, compared to $2,298 million in debt and $115 million of cash at year-end 2009. Adjusting for the debt associated with securitized Timeshare mortgage notes now required to be consolidated under new accounting rules, adjusted total debt, net of cash, totaled $1,591 million, a decline of nearly $600 million since year-end 2009.

At the end of the 2010 third quarter, Marriott did not have any borrowings outstanding under its $2.4 billion revolving bank credit facility.

COMMON STOCK

Weighted average fully diluted shares outstanding used to calculate diluted EPS totaled 378.1 million in the 2010 third quarter compared to weighted average fully diluted shares outstanding of 367.5 million used to calculate adjusted diluted EPS in the year-ago quarter.

The remaining share repurchase authorization, as of September 10, 2010, totaled 21.3 million shares.

FOURTH QUARTER 2010 OUTLOOK

For the fourth quarter, the company assumes comparable systemwide REVPAR on a constant dollar basis will increase 6 to 8 percent in North America, 7 to 9 percent outside North America and 6 to 8 percent worldwide.

The company assumes fourth quarter 2010 Timeshare contract sales will total $190 million to $200 million and Timeshare sales and services revenue, net of direct expenses, will total approximately $45 million to $50 million. With these assumptions, Timeshare segment results for the fourth quarter, including interest expense associated with securitized notes, are expected to total $40 million to $45 million, including an approximately $20 million gain on the sale of real estate.

The company expects to open about 30,000 rooms in 2010.

The company estimates that, on a full-year basis, one point of worldwide systemwide REVPAR impacts total fees by approximately $15 million pretax and owned, leased, corporate housing and other revenue, net of direct expense, by approximately $5 million pretax.

 
                             Fourth Quarter             Full Year
                                           2010                      2010
                                           ----                      ----
     Total fee revenue    $370  million to $380 $1,166  million to $1,176
                        million                 million
     Owned, leased,
      corporate housing
      and other
      revenue, net of
      direct expenses   Approx $40 million      Approx $90 million
     Timeshare sales
      and services
      revenue, net of
      direct expenses        $45 million to $50      $201 million to $206
                        million                 million
     General,
      administrative
      and other
      expenses             $220 million to $225      $649 million to $654
                        million                 million
     Operating income     $230  million to $250      $803 million to $823
                        million                 million
     Gains and other
      income            Approx $25 million      Approx $32 million
     Net interest
      expense(1)        Approx $50 million      Approx $169 million
     Equity in (losses) Approx ($10) million    Approx ($30) million
     Earnings per share          $0.33 to $0.36            $1.09 to $1.12
     Tax rate                                   35.5 percent


    (1)Net of interest income

The company expects investment spending in 2010 will total approximately $500 million, including $50 million for maintenance capital spending and $200 million of other capital expenditures (including property acquisitions). Investment spending will also include new mezzanine financing and mortgage loans, contract acquisition costs, and equity and other investments.

Based upon the assumptions above, full year 2010 EBITDA is expected to total $1,050 million to $1,065 million, an 8 to 9 percent increase over the prior year's adjusted EBITDA including the impact of consolidating securitized loans had that occurred at the beginning of 2009 rather than 2010. Adjusted EBITDA for full year 2009 totaled $974 million and is shown on page A-15.

2011 OUTLOOK

For the full year 2011, the company expects the business climate, particularly the pricing environment, to continue to improve. The company assumes full year 2011 systemwide REVPAR on a constant dollar basis will increase 6 to 8 percent in North America, outside North America and on a worldwide basis.

The company expects to open 25,000 to 30,000 rooms in 2011 as most hotels expected to open are already under construction or undergoing conversion from other brands. Given these assumptions, full year 2011 fee revenue could total $1,290 million to $1,330 million and owned, leased, corporate housing and other revenue, net of direct expense, could increase 5 to 15 percent year-over-year.

The company expects 2011 Timeshare contract sales to be in line with 2010 levels.

The company expects its 2011 general and administrative costs to increase 3 to 5 percent reflecting increased spending for brand initiatives and higher compensation.

Marriott International, Inc. (NYSE: MAR) will conduct its quarterly earnings review for the investment community and news media on Thursday, October 7, 2010 at 10 a.m. Eastern Time (ET). The conference call will be webcast simultaneously via Marriott's investor relations website at http://www.marriott.com/investor, click the "Recent and Upcoming Events" tab and click on the quarterly conference call link. A replay will be available at that same website until October 7, 2011.

The telephone dial-in number for the conference call is 706-679-3455 and the conference ID is 93873764. A telephone replay of the conference call will be available from 1 p.m. ET, Thursday, October 7, 2010 until 8 p.m. ET, Thursday, October 14, 2010. To access the replay, call 706-645-9291. The reservation number for the recording is 93873764.

Definitions

All references to net income or net loss reflect net income or net loss attributable to Marriott. All references to EPS or diluted losses per share, unless otherwise noted, reflect EPS or diluted losses per share attributable to Marriott shareholders.

Note: This press release and accompanying schedules contain "forward-looking statements" within the meaning of federal securities laws, including REVPAR, profit margin and earnings trends, estimates and assumptions; statements concerning the number of lodging properties we expect to add in the future; our expectations about investment spending and share repurchases; and similar statements concerning anticipated future events and expectations that are not historical facts. We caution you that these statements are not guarantees of future performance and are subject to numerous risks and uncertainties, including the continuation and pace of the economic recovery; supply and demand changes for hotel rooms, corporate housing and our Timeshare segment products; competitive conditions in the lodging industry; relationships with clients and property owners; the availability of capital to finance hotel growth and refurbishment; and other risk factors that we identify in our most recent quarterly report on Form 10-Q; any of which could cause actual results to differ materially from the expectations we express or imply here. These statements are made as of October 6, 2010, and we undertake no obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future events or otherwise.

MARRIOTT INTERNATIONAL, INC. (NYSE: MAR) is a leading lodging company with more than 3,500 lodging properties in 70 countries and territories. Marriott International operates and franchises hotels under the Marriott, JW Marriott, The Ritz-Carlton, The Autograph Collection, Renaissance, Residence Inn, Courtyard, TownePlace Suites, Fairfield Inn, SpringHill Suites and Bulgari brand names; develops and operates vacation ownership resorts under the Marriott Vacation Club, The Ritz-Carlton Destination Club, and Grand Residences by Marriott brands; licenses and manages whole-ownership residential brands, including The Ritz-Carlton Residences, JW Marriott Residences and Marriott Residences; operates Marriott Executive Apartments; provides furnished corporate housing through its Marriott ExecuStay division; and operates conference centers. The company is headquartered in Bethesda, Maryland, USA, and had approximately 137,000 employees at 2009 year-end. It is recognized by FORTUNE(R) as one of the best companies to work for, and by Newsweek as one of the greenest big companies in America. In fiscal year 2009, Marriott International reported sales from continuing operations of nearly $11 billion. For more information or reservations, please visit our web site at www.marriott.com, and for the latest company news, visit www.marriottnewscenter.com.

IRPR#1

Tables follow

                          MARRIOTT INTERNATIONAL, INC.
                            PRESS RELEASE SCHEDULES
                                QUARTER 3, 2010
                               TABLE OF CONTENTS

 
    Consolidated Statements of Income                                      A-1

    Total Lodging Products                                                 A-4

    Key Lodging Statistics                                                 A-5

    Timeshare Segment                                                      A-9

    Third Quarter 2009 Timeshare Segment As Adjusted Had ASU Nos. 2009-16
    and 2009-17 Been Adopted on January 3, 2009                           A-11

    Timeshare Inventory As Adjusted Had ASU Nos. 2009-16 and 2009-17 Been
    Adopted on January 3, 2009                                            A-12

    EBITDA and Adjusted EBITDA                                            A-13

    Third Quarter 2009 EBITDA As Adjusted Had ASU Nos. 2009-16 and
    2009-17 Been Adopted on January 3, 2009                               A-14

    2009 EBITDA As Adjusted Had ASU Nos. 2009-16 and 2009-17 Been Adopted
    on January 3, 2009 and Forecasted 2010                                A-15

    Adjusted Total Debt Net of Cash                                       A-16

    Third Quarter 2009 Interest Expense As Adjusted Had ASU Nos. 2009-16
    and 2009-17 Been Adopted on January 3, 2009                           A-17

    Non-GAAP Financial Measures                                           A-18

           MARRIOTT INTERNATIONAL, INC.
        CONSOLIDATED STATEMENTS OF INCOME
     (in millions, except per share amounts)



                                                       As         As
                                                    Reported   Reported
                                                    12 Weeks   12 Weeks
                                                      Ended      Ended
                                                    September  September
                                                    10, 2010   11, 2009
                                                   ---------     ---------


    REVENUES
    Base management fees                                 $123          $116
    Franchise fees                                        109           100
    Incentive management fees                              21            17
    Owned, leased, corporate housing and other
     revenue (1)                                          220           226
    Timeshare sales and services (2)                      275           254
    Cost reimbursements (3)                             1,900         1,758
                                                        -----         -----
       Total Revenues                                   2,648         2,471

    OPERATING COSTS AND EXPENSES
    Owned, leased and corporate housing -direct
     (4)                                                  213           214
    Timeshare - direct                                    219           238
    Timeshare strategy - impairment charges                 -           614
    Reimbursed costs                                    1,900         1,758
    Restructuring costs                                     -             9
    General, administrative and other (5)                 149           144
                                                          ---           ---
       Total Expenses                                   2,481         2,977
                                                        -----         -----

    OPERATING INCOME (LOSS)                               167          (506)

    Gains and other income (6)                              3            (1)
    Interest expense                                      (41)          (27)
    Interest income                                         4             5
    Equity in losses (7)                                   (5)          (12)
    Timeshare strategy - impairment charges (non-
     operating)                                             -          (138)
                                                          ---          ----

    INCOME (LOSS) BEFORE INCOME TAXES                     128          (679)

    (Provision) benefit for income taxes                  (45)          210
                                                          ---           ---

    NET INCOME (LOSS)                                      83          (469)

    Add: Net losses attributable to noncontrolling
     interests, net of tax                                  -             3
                                                          ---           ---

    NET INCOME (LOSS) ATTRIBUTABLE TO MARRIOTT            $83         $(466)
                                                          ===         =====

    EARNINGS (LOSSES) PER SHARE - Basic (8)
       Earnings (losses) per share attributable to
        Marriott shareholders 9                         $0.23        $(1.31)
                                                        =====        ======

    EARNINGS (LOSSES) PER SHARE - Diluted (8,10)
       Earnings (losses) per share attributable to
        Marriott shareholders 9                         $0.22        $(1.31)
                                                        =====        ======


    Basic Shares (8)                                    363.1         356.7
    Diluted Shares (8,10)                               378.1         356.7





                                                 Adjustments
                                                 -----------
                                                      Timeshare
                                     Restructuring     Strategy
                                         Costs &           -      Certain
                                          Other       Impairment     Tax
                                         Charges       Charges     Items
                                     --------------   ----------  --------


    REVENUES
    Base management fees                         $-           $-        $-
    Franchise fees                                -            -         -
    Incentive management fees                     -            -         -
    Owned, leased, corporate housing
     and other revenue (1)                        -            -         -
    Timeshare sales and services (2)             (3)           -         -
    Cost reimbursements (3)                       -            -         -
                                                ---          ---       ---
       Total Revenues                            (3)           -         -

    OPERATING COSTS AND EXPENSES
    Owned, leased and corporate
     housing -direct (4)                          -            -         -
    Timeshare - direct                            -            -         -
    Timeshare strategy -impairment
     charges                                      -         (614)        -
    Reimbursed costs                              -            -         -
    Restructuring costs                          (9)           -         -
    General, administrative and
     other (5)                                   (1)           -         -
                                                ---          ---       ---
       Total Expenses                           (10)        (614)        -
                                                ---         ----       ---

    OPERATING INCOME (LOSS)                       7          614         -

    Gains and other income (6)                    -            -         -
    Interest expense                              -            -         -
    Interest income                               -            -         -
    Equity in losses (7)                          1            -         -
    Timeshare strategy - impairment
     charges (non-operating)                      -          138         -
                                                ---          ---       ---

    INCOME (LOSS) BEFORE INCOME
     TAXES                                        8          752         -

    (Provision) benefit for income
     taxes                                       (4)        (250)       13
                                                ---         ----       ---

    NET INCOME (LOSS)                             4          502        13

    Add: Net losses attributable to
     noncontrolling interests, net
     of tax                                       -            -         -
                                                ---          ---       ---

    NET INCOME (LOSS) ATTRIBUTABLE
     TO MARRIOTT                                 $4         $502       $13
                                                ===         ====       ===

    EARNINGS (LOSSES) PER SHARE -
     Basic (8)
       Earnings (losses) per share
        attributable to Marriott
        shareholders 9                        $0.01        $1.41     $0.03
                                              =====        =====     =====

    EARNINGS (LOSSES) PER SHARE -
     Diluted (8,10)
       Earnings (losses) per share
        attributable to Marriott
        shareholders 9                        $0.01        $1.41     $0.03
                                              =====        =====     =====


    Basic Shares (8)                          356.7        356.7     356.7
    Diluted Shares (8,10)                     356.7        356.7     356.7






                                                       As
                                                    Adjusted   Percent
                                                    12 Weeks   Better/
                                                      Ended    (Worse)
                                                    September  2010 vs.
                                                        11,    Adjusted
                                                     2009**      2009
                                                   ---------     --------


    REVENUES
    Base management fees                                 $116            6
    Franchise fees                                        100            9
    Incentive management fees                              17           24
    Owned, leased, corporate housing and other
     revenue (1)                                          226           (3)
    Timeshare sales and services (2)                      251           10
    Cost reimbursements (3)                             1,758            8
                                                        -----
       Total Revenues                                   2,468            7

    OPERATING COSTS AND EXPENSES
    Owned, leased and corporate housing -direct
     (4)                                                  214            -
    Timeshare - direct                                    238            8
    Timeshare strategy - impairment charges                 -            -
    Reimbursed costs                                    1,758           (8)
    Restructuring costs                                     -            -
    General, administrative and other (5)                 143           (4)
                                                          ---
       Total Expenses                                   2,353           (5)
                                                        -----

    OPERATING INCOME (LOSS)                               115           45

    Gains and other income (6)                             (1)         400
    Interest expense                                      (27)         (52)
    Interest income                                         5          (20)
    Equity in losses (7)                                  (11)          55
    Timeshare strategy - impairment charges (non-
     operating)                                             -            -
                                                          ---

    INCOME (LOSS) BEFORE INCOME TAXES                      81           58

    (Provision) benefit for income taxes                  (31)         (45)
                                                          ---

    NET INCOME (LOSS)                                      50           66

    Add: Net losses attributable to noncontrolling
     interests, net of tax                                  3         (100)
                                                          ---

    NET INCOME (LOSS) ATTRIBUTABLE TO MARRIOTT            $53           57
                                                          ===

    EARNINGS (LOSSES) PER SHARE - Basic (8)
       Earnings (losses) per share attributable to
        Marriott shareholders 9                         $0.15           53
                                                        =====

    EARNINGS (LOSSES) PER SHARE - Diluted (8,10)
       Earnings (losses) per share attributable to
        Marriott shareholders 9                         $0.15           47
                                                        =====


    Basic Shares (8)                                    356.7
    Diluted Shares (8,10)                               367.5



    ** Denotes non-GAAP financial measures. Please see pages A-18 and
    A-19 for additional information about our reasons for providing
    these alternative financial measures and limitations on their use.
    See page A-3 for footnote references.
                                                              A-1

           MARRIOTT INTERNATIONAL, INC.
        CONSOLIDATED STATEMENTS OF INCOME
     (in millions, except per share amounts)



                                                          As          As
                                                       Reported    Reported
                                                       36 Weeks    36 Weeks
                                                         Ended       Ended
                                                       September   September
                                                       10, 2010    11, 2009
                                                      ---------   ---------


    REVENUES
    Base management fees                                    $384        $367
    Franchise fees                                           305         281
    Incentive management fees                                107          95
    Owned, leased, corporate housing and other
     revenue (1)                                             704         684
    Timeshare sales and services (including net note
     sale losses of $1 for                                   849         746
      thirty-six weeks ended September 11, 2009) (2)
    Cost reimbursements (3)                                5,700       5,355
       Total Revenues                                      8,049       7,528

    OPERATING COSTS AND EXPENSES
    Owned, leased and corporate housing - direct (4)         654         638
    Timeshare - direct                                       693         737
    Timeshare strategy - impairment charges                    -         614
    Reimbursed costs                                       5,700       5,355
    Restructuring costs                                        -          44
    General, administrative and other (5)                    429         507
       Total Expenses                                      7,476       7,895
                                                           -----

    OPERATING INCOME (LOSS)                                  573        (367)

    Gains and other income (including gain on debt
     extinguishment of $21                                     7          27
      for the thirty-six weeks ended September 11,
       2009) (6)
    Interest expense                                        (130)        (84)
    Interest income                                           11          20
    Equity in losses (7)                                     (20)        (50)
    Timeshare strategy - impairment charges (non-
     operating)                                                -        (138)
                                                             ---        ----

    INCOME (LOSS) BEFORE INCOME TAXES                        441        (592)

    (Provision) benefit for income taxes                    (156)        133
                                                            ----         ---

    NET INCOME (LOSS)                                        285        (459)

    Add: Net losses attributable to noncontrolling
     interests, net of tax                                     -           7
                                                             ---         ---

    NET INCOME (LOSS) ATTRIBUTABLE TO MARRIOTT              $285       $(452)
                                                            ====       =====

    EARNINGS (LOSSES) PER SHARE - Basic (8)
       Earnings (losses) per share attributable to
        Marriott shareholders (9)                          $0.79      $(1.27)
                                                           =====      ======

    EARNINGS (LOSSES) PER SHARE - Diluted (8,10)
       Earnings (losses) per share attributable to
        Marriott shareholders (9)                          $0.76      $(1.27)
                                                           =====      ======


    Basic Shares (8)                                       361.5       355.7
    Diluted Shares (8,10)                                  376.4       355.7





                                                 Adjustments
                                                 -----------
                                                      Timeshare
                                     Restructuring     Strategy
                                         Costs &           -      Certain
                                          Other       Impairment     Tax
                                         Charges       Charges     Items
                                     --------------   ----------  --------


    REVENUES
    Base management fees                         $-           $-        $-
    Franchise fees                                -            -         -
    Incentive management fees                     -            -         -
    Owned, leased, corporate
     housing and other revenue (1)                -            -         -
    Timeshare sales and services
     (including net note sale
     losses of $1 for                            26            -         -
      thirty-six weeks ended
       September 11, 2009) (2)
    Cost reimbursements (3)                       -            -         -
       Total Revenues                            26            -         -

    OPERATING COSTS AND EXPENSES
    Owned, leased and corporate
     housing -direct (4)                          -            -         -
    Timeshare - direct                            1            -         -
    Timeshare strategy -impairment
     charges                                      -         (614)        -
    Reimbursed costs                              -            -         -
    Restructuring costs                         (44)           -         -
    General, administrative and
     other (5)                                  (92)           -         -
       Total Expenses                          (135)        (614)        -
                                                            ----       ---

    OPERATING INCOME (LOSS)                     161          614         -

    Gains and other income
     (including gain on debt
     extinguishment of $21                        -            -         -
      for the thirty-six weeks ended
       September 11, 2009) (6)
    Interest expense                              -            -         -
    Interest income                               -            -         -
    Equity in losses (7)                         33            -         -
    Timeshare strategy -
     impairment charges (non-
     operating)                                   -          138         -
                                                ---          ---       ---

    INCOME (LOSS) BEFORE INCOME
     TAXES                                      194          752         -

    (Provision) benefit for income
     taxes                                      (76)        (250)       56
                                                ---         ----       ---

    NET INCOME (LOSS)                           118          502        56

    Add: Net losses attributable to
     noncontrolling interests, net
     of tax                                       -            -         -
                                                ---          ---       ---

    NET INCOME (LOSS) ATTRIBUTABLE
     TO MARRIOTT                               $118         $502       $56
                                               ====         ====       ===

    EARNINGS (LOSSES) PER SHARE -
     Basic (8)
       Earnings (losses) per share
        attributable to Marriott
        shareholders (9)                      $0.33        $1.41     $0.16
                                              =====        =====     =====

    EARNINGS (LOSSES) PER SHARE -
     Diluted (8,10)
       Earnings (losses) per share
        attributable to Marriott
        shareholders (9)                      $0.33        $1.41     $0.16
                                              =====        =====     =====


    Basic Shares (8)                          355.7        355.7     355.7
    Diluted Shares (8,10)                     355.7        355.7     355.7







                                                         As      Percent
                                                      Adjusted   Better/
                                                      36 Weeks    (Worse)
                                                        Ended       2010
                                                      September    vs.
                                                          11,    Adjusted
                                                       2009**       2009
                                                     ---------     --------


    REVENUES
    Base management fees                                   $367            5
    Franchise fees                                          281            9
    Incentive management fees                                95           13
    Owned, leased, corporate housing and other
     revenue (1)                                            684            3
    Timeshare sales and services (including net note
     sale losses of $1 for                                  772           10
      thirty-six weeks ended September 11, 2009) (2)
    Cost reimbursements (3)                               5,355            6
       Total Revenues                                     7,554            7

    OPERATING COSTS AND EXPENSES
    Owned, leased and corporate housing - direct (4)        638           (3)
    Timeshare - direct                                      738            6
    Timeshare strategy - impairment charges                   -            -
    Reimbursed costs                                      5,355           (6)
    Restructuring costs                                       -            -
    General, administrative and other (5)                   415           (3)
       Total Expenses                                     7,146           (5)
                                                          -----

    OPERATING INCOME (LOSS)                                 408           40

    Gains and other income (including gain on debt
     extinguishment of $21                                   27          (74)
      for the thirty-six weeks ended September 11,
       2009) (6)
    Interest expense                                        (84)         (55)
    Interest income                                          20          (45)
    Equity in losses (7)                                    (17)         (18)
    Timeshare strategy - impairment charges (non-
     operating)                                               -            -
                                                            ---

    INCOME (LOSS) BEFORE INCOME TAXES                       354           25

    (Provision) benefit for income taxes                   (137)         (14)
                                                           ----

    NET INCOME (LOSS)                                       217           31

    Add: Net losses attributable to noncontrolling
     interests, net of tax                                    7         (100)
                                                            ---

    NET INCOME (LOSS) ATTRIBUTABLE TO MARRIOTT             $224           27
                                                           ====

    EARNINGS (LOSSES) PER SHARE - Basic (8)
       Earnings (losses) per share attributable to
        Marriott shareholders (9)                         $0.63           25
                                                          =====

    EARNINGS (LOSSES) PER SHARE - Diluted (8,10)
       Earnings (losses) per share attributable to
        Marriott shareholders (9)                         $0.61           25
                                                          =====


    Basic Shares (8)                                      355.7
    Diluted Shares (8,10)                                 365.4



    ** Denotes non-GAAP financial measures. Please see pages A-18 and
    A-19 for additional information about our reasons for providing
    these alternative financial measures and limitations on their use.
    See page A-3 for footnote references.
                                                             A-2

                              MARRIOTT INTERNATIONAL, INC.
                     FOOTNOTES TO CONSOLIDATED STATEMENTS OF INCOME

 
    1 --Owned, leased, corporate housing and other revenue includes
    revenue from the properties we own or lease, revenue from our
    corporate housing business, termination fees, branding fees and
    other revenue.
    2 --Timeshare sales and services includes total timeshare revenue
    except for base management fees and cost reimbursements.
    3 -- Cost reimbursements include reimbursements from properties for
    Marriott-funded operating expenses.
    4 -- Owned, leased and corporate housing - direct expenses include
    operating expenses related to our owned or leased hotels, including
    lease payments, pre-opening expenses and depreciation, plus
    expenses related to our corporate housing business.
    5 --General, administrative and other expenses include the overhead
    costs allocated to our segments, and our corporate overhead costs
    and general expenses.
    6 --Gains and other income includes gains and losses on: the sale of
    real estate, note sales or repayments (except timeshare note
    securitizations), the sale of joint ventures and investments; and
    debt extinguishments, as well as income from cost method joint
    ventures.
    7 --Equity in losses includes our equity in losses of unconsolidated
    equity method joint ventures.
    8 --2009 share numbers and per share amounts have been retroactively
    adjusted to reflect the stock dividends with distribution dates of
    July 30, 2009, September 3, 2009 and December 3, 2009.
    9 --Earnings per share attributable to Marriott shareholders plus
    adjustment items may not equal earnings per share attributable to
    Marriott shareholders as adjusted due to rounding.
    10 -- Basic and fully diluted weighted average common shares
    outstanding used to calculate earnings per share for the periods in
    which we had a loss are the same because inclusion of additional
    equivalents would be anti-dilutive.
                                          A-3

                                                 MARRIOTT INTERNATIONAL, INC.
                                                  TOTAL LODGING PRODUCTS (1)


                                          Number of Properties
                                          --------------------
                             September 10,    September 11,   vs. September
                  Brand           2010             2009          11, 2009
                  -----      --------------  --------------  --------------

    Domestic Full-Service
    ---------------------
        Marriott Hotels &
         Resorts                        355             350               5
        Renaissance Hotels               79              78               1
        Autograph Collection             11               -              11
    Domestic Limited-
     Service
    -----------------
        Courtyard                       785             761              24
        Fairfield Inn &
         Suites                         647             609              38
        SpringHill Suites               271             241              30
        Residence Inn                   592             583               9
        TownePlace Suites               192             179              13
    International
    -------------
        Marriott Hotels &
         Resorts                        195             188               7
        Renaissance Hotels               67              65               2
        Courtyard                        97              88               9
        Fairfield Inn &
         Suites                          10               9               1
        SpringHill Suites                 1               1               -
        Residence Inn                    18              18               -
        Marriott Executive
         Apartments                      23              22               1
    Luxury
    ------
        The Ritz-Carlton -
         Domestic                        39              37               2
        The Ritz-Carlton -
         International                   35              33               2
        Bulgari Hotels &
         Resorts                          2               2               -
        The Ritz-Carlton
         Residential                     26              25               1
        The Ritz-Carlton
         Serviced Apartments              3               3               -
    Timeshare (2)
    -------------
        Marriott Vacation
         Club (3)                        53              52               1
        The Ritz-Carlton
         Destination Club                 9              10              (1)
        The Ritz-Carlton
         Residences                       4               4               -
        Grand Residences by
         Marriott -
         Fractional                       2               2               -
        Grand Residences by
         Marriott -
         Residential                      2               2               -
    Sub Total Timeshare                  70              70               -
                                        ---             ---             ---

    Total                             3,518           3,362             156
                                      =====           =====             ===




                                       Number of Rooms/Suites
                                       ----------------------
                              September 10, September 11,   vs. September
                  Brand            2010          2009          11, 2009
                  -----      -------------- -------------- --------------

    Domestic Full-
     Service
    --------------
        Marriott Hotels &
         Resorts                    142,277        139,280           2,997
        Renaissance Hotels           28,790         28,508             282
        Autograph Collection          1,646              -           1,646
    Domestic Limited-
     Service
    -----------------
        Courtyard                   110,325        106,835           3,490
        Fairfield Inn &
         Suites                      58,398         54,537           3,861
        SpringHill Suites            31,772         27,818           3,954
        Residence Inn                71,280         69,865           1,415
        TownePlace Suites            19,320         17,917           1,403
    International
    -------------
        Marriott Hotels &
         Resorts                     59,936         57,010           2,926
        Renaissance Hotels           22,622         22,291             331
        Courtyard                    19,307         17,254           2,053
        Fairfield Inn &
         Suites                       1,235          1,109             126
        SpringHill Suites               124            124               -
        Residence Inn                 2,559          2,604             (45)
        Marriott Executive
         Apartments                   3,775          3,580             195
    Luxury
    ------
        The Ritz-Carlton -
         Domestic                    11,587         11,549              38
        The Ritz-Carlton -
         International               10,457         10,117             340
        Bulgari Hotels &
         Resorts                        117            117               -
        The Ritz-Carlton
         Residential                  2,715          2,638              77
        The Ritz-Carlton
         Serviced Apartments            458            474             (16)
    Timeshare (2)
    -------------
        Marriott Vacation
         Club (3)                    11,866         11,854              12
        The Ritz-Carlton
         Destination Club               446            461             (15)
        The Ritz-Carlton
         Residences                     238            234               4
        Grand Residences by
         Marriott -
         Fractional                     248            248               -
        Grand Residences by
         Marriott -
         Residential                     68             91             (23)
    Sub Total Timeshare              12,866         12,888             (22)
                                     ------         ------             ---

    Total                           611,566        586,515          25,051
                                    =======        =======          ======



 
    Number of Timeshare Interval, Fractional and Residential Resorts
    ----------------------------------------------------------------

                                              Total      Properties in
                                            Properties    Active Sales
                                                 (2)            (4)
                                           -----------   -------------
    100% Company-Developed
    ----------------------
        Marriott Vacation Club (3)                   53              27
        The Ritz-Carlton Destination
         Club and Residences                         11               9
        Grand Residences by Marriott and
         Residences                                   4               3

    Joint Ventures
    --------------
        The Ritz-Carlton Destination
         Club and Residences                          2               2

    Total                                            70              41
                                                    ===             ===




    1 Total Lodging Products excludes the 1,993 and 2,153 corporate
    housing rental units as of September 10, 2010 and September 11,
    2009, respectively.
    2 Includes products that are in active sales as well as those that
    are sold out.  Residential products are included once they possess a
    certificate of occupancy.
    3 Marriott Vacation Club includes Horizons by Marriott Vacation Club
    products that were previously reported separately.
    4 Products in active sales may not be ready for occupancy.
                                                              A-4

                      MARRIOTT INTERNATIONAL, INC.
                         KEY LODGING STATISTICS
                               CONSTANT $
        Comparable Company-Operated International Properties(1)


                             Three Months Ended August 31, 2010 and August
                                               31, 2009
                             ---------------------------------------------
                             REVPAR              Occupancy             Average
                             ------              ---------              Daily
                                                                         Rate
                                                                        ----
                                  vs.                   vs.             vs.
    Region                2010    2009   2010           2009     2010   2009
    ------                ----   ----    ----          ----      ----  ----
    Caribbean & Latin
     America           $113.33     7.6%  71.5%   5.8%   pts.  $158.53   -1.1%
    Continental
     Europe            $112.54     8.6%  75.5%   3.8%   pts.  $149.09    3.2%
    United Kingdom     $129.35     9.7%  81.6%   3.3%   pts.  $158.45    5.3%
    Middle East &
     Africa             $74.25    -2.2%  62.4%   1.5%   pts.  $119.06   -4.5%
    Asia Pacific(2)     $80.76    29.9%  68.1%  13.1%   pts.  $118.54    4.9%

    Regional
     Composite(3)      $103.89    12.1%  73.0%   6.5%   pts.  $142.33    2.2%

    International
     Luxury(4)         $182.05    12.4%  62.8%   5.3%   pts.  $289.92    2.8%

    Total
     International(5)  $112.42    12.2%  71.9%   6.3%   pts.  $156.39    2.3%

    Worldwide(6)       $101.43     8.4%  71.2%   3.7%   pts.  $142.46    2.8%


             Comparable Systemwide International Properties(1)
             -------------------------------------------------

                        Three Months Ended August 31, 2010 and August
                                           31, 2009
                       ----------------------------------------------
                           REVPAR           Occupancy         Average
                           ------           ---------          Daily
                                                                Rate
                                                                ----
                                  vs.                   vs.             vs.
    Region                2010    2009   2010           2009     2010   2009
    ------                ----   ----    ----          ----      ----  ----
    Caribbean & Latin
     America           $100.82    14.2%  68.6%   8.1%   pts.  $146.92    0.7%
    Continental
     Europe            $111.17     9.0%  74.7%   4.8%   pts.  $148.78    2.0%
    United Kingdom     $127.58     9.6%  81.3%   3.4%   pts.  $157.02    5.0%
    Middle East &
     Africa             $73.85    -1.9%  62.7%   1.6%   pts.  $117.81   -4.4%
    Asia Pacific(2)     $88.25    21.0%  68.2%  11.3%   pts.  $129.35    0.9%

    Regional
     Composite(3)      $103.38    11.9%  72.2%   6.7%   pts.  $143.23    1.5%

    International
     Luxury(4)         $182.05    12.4%  62.8%   5.3%   pts.  $289.92    2.8%

    Total
     International(5)  $110.47    12.0%  71.3%   6.6%   pts.  $154.85    1.6%

    Worldwide(6)        $89.79     8.2%  71.7%   4.2%   pts.  $125.18    1.8%




    1  We report financial results on a period basis and international
    statistics on a monthly basis.  Statistics are in constant dollars
    for June through August.  International includes properties located
    outside the Continental United States and Canada, except for
    Worldwide which includes the Continental United States.
    2  Does not include Hawaii.
    3  Regional information includes the Marriott Hotels & Resorts,
    Renaissance Hotels and Courtyard brands. Includes Hawaii.
    4  International Luxury includes The Ritz-Carlton properties outside
    of the Continental United States and Canada and Bulgari Hotels &
    Resorts.
    5  Includes Regional Composite and International Luxury.
    6  Includes international statistics for the three calendar months
    ended August 31, 2010 and August 31, 2009, and the Continental
    United States statistics for the twelve weeks ended September 10,
    2010 and September 11, 2009.  Includes the Marriott Hotels &
    Resorts, Renaissance Hotels, The Ritz-Carlton, Bulgari Hotels &
    Resorts, Residence Inn, Courtyard, Fairfield Inn & Suites,
    TownePlace Suites and SpringHill Suites brands.
                                     A-5

                    MARRIOTT INTERNATIONAL, INC.
                       KEY LODGING STATISTICS
                             CONSTANT $
      Comparable Company-Operated International Properties(1)


                             Eight Months Ended August 31, 2010 and August
                                                31, 2009
                             ---------------------------------------------
                             REVPAR              Occupancy             Average
                             ------              ---------              Daily
                                                                       Rate
                                                                       ----
                                  vs.                   vs.              vs.
    Region                2010    2009   2010           2009     2010    2009
    ------                ----   ----    ----          ----      ----   ----
    Caribbean &
     Latin
     America           $130.49     5.2%  72.4%   5.2%   pts.  $180.16    -2.4%
    Continental
     Europe            $108.94     5.8%  69.4%   4.0%   pts.  $156.87    -0.3%
    United
     Kingdom           $117.80     7.5%  76.0%   3.9%   pts.  $154.96     2.0%
    Middle East &
     Africa             $90.84    -4.4%  69.0%   2.3%   pts.  $131.57    -7.5%
    Asia
     Pacific(2)         $80.00    25.7%  66.1%  14.1%   pts.  $121.02    -1.1%

    Regional
     Composite(3)      $104.12     8.5%  70.5%   6.8%   pts.  $147.78    -1.9%

    International
     Luxury(4)         $196.14     9.8%  63.5%   6.8%   pts.  $308.92    -1.9%

    Total
     International(5)  $114.16     8.7%  69.7%   6.8%   pts.  $163.79    -1.8%

    Worldwide(6)       $102.45     5.5%  69.2%   4.6%   pts.  $148.01    -1.5%


             Comparable Systemwide International Properties(1)
             -------------------------------------------------

                         Eight Months Ended August 31, 2010 and August
                                            31, 2009
                        ----------------------------------------------
                           REVPAR           Occupancy         Average
                           ------           ---------          Daily
                                                                 Rate
                                                                 ----
                                  vs.                   vs.              vs.
    Region                2010    2009   2010           2009     2010    2009
    ------                ----   ----    ----          ----      ----   ----
    Caribbean &
     Latin
     America           $113.59    11.1%  69.3%   7.9%   pts.  $163.94    -1.6%
    Continental
     Europe            $106.02     5.5%  68.1%   4.7%   pts.  $155.68    -1.8%
    United
     Kingdom           $116.04     7.3%  75.4%   3.8%   pts.  $153.86     1.9%
    Middle East &
     Africa             $89.87    -3.9%  69.1%   2.7%   pts.  $130.09    -7.6%
    Asia
     Pacific(2)         $85.54    17.9%  66.5%  12.1%   pts.  $128.55    -3.5%

    Regional
     Composite(3)      $102.48     8.4%  69.4%   6.9%   pts.  $147.58    -2.4%

    International
     Luxury(4)         $196.14     9.8%  63.5%   6.8%   pts.  $308.92    -1.9%

    Total
     International(5)  $110.92     8.6%  68.9%   6.9%   pts.  $160.97    -2.3%

    Worldwide(6)        $87.38     4.8%  68.6%   4.3%   pts.  $127.41    -1.8%




    1  We report financial results on a period basis and international
    statistics on a monthly basis.  Statistics are in constant dollars
    for January through August.  International includes properties
    located outside the Continental United States and Canada, except for
    Worldwide which includes the Continental United States.
    2  Does not include Hawaii.
    3  Regional information includes the Marriott Hotels & Resorts,
    Renaissance Hotels and Courtyard brands.  Includes Hawaii.
    4  International Luxury includes The Ritz-Carlton properties outside
    of the Continental United States and Canada and Bulgari Hotels &
    Resorts.
    5  Includes Regional Composite and International Luxury.
    6  Includes international statistics for the eight calendar months
    ended August 31, 2010 and August 31, 2009, and the Continental
    United States statistics for the thirty-six weeks ended September
    10, 2010 and September 11, 2009.  Includes the Marriott Hotels &
    Resorts, Renaissance Hotels, The Ritz-Carlton, Bulgari Hotels &
    Resorts, Residence Inn, Courtyard, Fairfield Inn & Suites,
    TownePlace Suites and SpringHill Suites brands.
                                     A-6

                        MARRIOTT INTERNATIONAL, INC.
                           KEY LODGING STATISTICS
          Comparable Company-Operated North American Properties(1)


                             Twelve Weeks Ended September 10, 2010 and
                                   September 11, 2009
                             -----------------------------------------
                                  REVPAR             Occupancy
                                  ------             ---------
                                        vs.                  vs.
    Brand                      2010    2009   2010          2009
    -----                      ----    ----   ----          ----
    Marriott Hotels &
     Resorts                $105.35     7.0%  71.7%  2.2%   pts.
    Renaissance Hotels       $98.20     3.8%  69.1%  0.7%   pts.
    Composite North
     American Full-
     Service(2)             $104.01     6.4%  71.2%  1.9%   pts.
    The Ritz-Carlton(3)     $169.51     7.9%  68.6%  2.9%   pts.
    Composite North
     American Full-
     Service & Luxury(4)    $112.10     6.7%  70.9%  2.0%   pts.
    Residence Inn            $89.50     6.2%  78.9%  3.8%   pts.
    Courtyard                $71.37     5.8%  67.5%  2.5%   pts.
    TownePlace Suites        $54.67     5.2%  72.8%  4.0%   pts.
    SpringHill Suites        $64.65     8.0%  68.5%  3.6%   pts.
    Composite North
     American Limited-
     Service(5)              $74.74     6.0%  70.9%  3.0%   pts.
    Composite - All(6)       $96.40     6.5%  70.9%  2.4%   pts.






                         Twelve Weeks Ended September 10, 2010 and
                                     September 11, 2009
                         -----------------------------------------
                                           Average Daily
                                               Rate
                                          --------------
                                                                    vs.
    Brand                                                     2010 2009
    -----                                                     ---- ----
    Marriott Hotels &
     Resorts                                               $147.02  3.7%
    Renaissance Hotels                                     $142.02  2.7%
    Composite North
     American Full-
     Service(2)                                            $146.11  3.5%
    The Ritz-Carlton(3)                                    $247.12  3.3%
    Composite North
     American Full-
     Service & Luxury(4)                                   $158.18  3.6%
    Residence Inn                                          $113.40  1.1%
    Courtyard                                              $105.77  1.9%
    TownePlace Suites                                       $75.06 -0.5%
    SpringHill Suites                                       $94.32  2.3%
    Composite North
     American Limited-
     Service(5)                                            $105.39  1.5%
    Composite - All(6)                                     $135.99  2.8%




             Comparable Systemwide North American Properties(1)


                             Twelve Weeks Ended September 10, 2010 and
                                   September 11, 2009
                             -----------------------------------------
                                  REVPAR             Occupancy
                                  ------             ---------
                                        vs.                  vs.
    Brand                      2010    2009   2010          2009
    -----                      ----    ----   ----          ----
    Marriott Hotels &
     Resorts                 $95.20     7.4%  69.4%  3.1%   pts.
    Renaissance Hotels       $92.22     6.2%  69.6%  2.7%   pts.
    Composite North
     American Full-
     Service(2)              $94.67     7.2%  69.4%  3.1%   pts.
    The Ritz-Carlton(3)     $169.51     7.9%  68.6%  2.9%   pts.
    Composite North
     American Full-
     Service & Luxury(4)    $100.21     7.3%  69.4%  3.0%   pts.
    Residence Inn            $91.37     6.6%  80.6%  4.4%   pts.
    Courtyard                $76.92     6.8%  70.2%  3.3%   pts.
    Fairfield Inn & Suites   $61.20     8.4%  70.5%  4.4%   pts.
    TownePlace Suites        $61.74     8.6%  76.4%  7.1%   pts.
    SpringHill Suites        $69.63     6.9%  70.6%  4.5%   pts.
    Composite North
     American Limited-
     Service(5)              $75.92     7.1%  73.3%  4.1%   pts.
    Composite - All(6)       $85.24     7.2%  71.8%  3.7%   pts.






                           Twelve Weeks Ended September 10, 2010 and
                                       September 11, 2009
                           -----------------------------------------
                                             Average Daily
                                                 Rate
                                            --------------
                                                                      vs.
    Brand                                                       2010 2009
    -----                                                       ---- ----
    Marriott Hotels &
     Resorts                                                 $137.17  2.6%
    Renaissance Hotels                                       $132.59  2.1%
    Composite North
     American Full-
     Service(2)                                              $136.35  2.5%
    The Ritz-Carlton(3)                                      $247.12  3.3%
    Composite North
     American Full-
     Service & Luxury(4)                                     $144.46  2.6%
    Residence Inn                                            $113.32  0.9%
    Courtyard                                                $109.63  1.8%
    Fairfield Inn & Suites                                    $86.76  1.7%
    TownePlace Suites                                         $80.79 -1.4%
    SpringHill Suites                                         $98.56  0.1%
    Composite North
     American Limited-
     Service(5)                                              $103.52  1.1%
    Composite - All(6)                                       $118.69  1.7%




    1  Statistics include only properties located in the Continental
    United States.
    2  Includes the Marriott Hotels & Resorts and Renaissance Hotels
    brands.
    3  Statistics for The Ritz-Carlton are for June through August.
    4  Includes the Marriott Hotels & Resorts, Renaissance Hotels and The
    Ritz-Carlton brands.
    5  Includes the Residence Inn, Courtyard, Fairfield Inn & Suites,
    TownePlace Suites and SpringHill Suites brands.
    6  Includes the Marriott Hotels & Resorts, Renaissance Hotels, The
    Ritz-Carlton, Residence Inn, Courtyard, Fairfield Inn & Suites,
    TownePlace Suites, and SpringHill Suites brands.
                                     A-7

                         MARRIOTT INTERNATIONAL, INC.
                            KEY LODGING STATISTICS
           Comparable Company-Operated North American Properties(1)


                              Thirty-six Weeks Ended September 10, 2010 and
                                    September 11, 2009
                              ---------------------------------------------
                                   REVPAR             Occupancy
                                   ------             ---------
                                         vs.                  vs.
    Brand                       2010    2009   2010          2009
    -----                       ----    ----   ----          ----
    Marriott Hotels &
     Resorts                 $107.94     4.3%  70.4%  3.7%   pts.
    Renaissance Hotels       $102.32     1.1%  68.1%  2.2%   pts.
    Composite North
     American Full-
     Service(2)              $106.88     3.7%  69.9%  3.4%   pts.
    The Ritz-Carlton(3)      $191.72     9.7%  68.7%  6.5%   pts.
    Composite North
     American Full-Service
     & Luxury(4)             $116.24     4.7%  69.8%  3.7%   pts.
    Residence Inn             $85.65     3.5%  75.0%  4.7%   pts.
    Courtyard                 $69.98     1.9%  65.2%  3.2%   pts.
    TownePlace Suites         $49.48    -1.1%  66.6%  3.4%   pts.
    SpringHill Suites         $63.36     3.0%  65.9%  3.7%   pts.
    Composite North
     American Limited-
     Service(5)               $72.48     2.3%  68.0%  3.6%   pts.
    Composite - All(6)        $97.69     4.0%  69.0%  3.7%   pts.





                           Thirty-six Weeks Ended September 10, 2010 and
                                         September 11, 2009
                           ---------------------------------------------
                                               Average Daily
                                                   Rate
                                              --------------
                                                                          vs.
    Brand                                                           2010 2009
    -----                                                           ---- ----
    Marriott Hotels &
     Resorts                                                     $153.40 -1.2%
    Renaissance Hotels                                           $150.30 -2.3%
    Composite North
     American Full-
     Service(2)                                                  $152.83 -1.4%
    The Ritz-Carlton(3)                                          $279.22 -0.7%
    Composite North
     American Full-Service
     & Luxury(4)                                                 $166.55 -0.9%
    Residence Inn                                                $114.20 -3.0%
    Courtyard                                                    $107.35 -3.1%
    TownePlace Suites                                             $74.34 -6.2%
    SpringHill Suites                                             $96.09 -2.9%
    Composite North
     American Limited-
     Service(5)                                                  $106.63 -3.1%
    Composite - All(6)                                           $141.53 -1.6%



 
              Comparable Systemwide North American Properties(1)


                              Thirty-six Weeks Ended September 10, 2010 and
                                    September 11, 2009
                              ---------------------------------------------
                                   REVPAR             Occupancy
                                   ------             ---------
                                         vs.                  vs.
    Brand                       2010    2009   2010          2009
    -----                       ----    ----   ----          ----
    Marriott Hotels &
     Resorts                  $95.79     4.4%  67.6%  4.0%   pts.
    Renaissance Hotels        $94.03     3.1%  68.0%  3.9%   pts.
    Composite North
     American Full-
     Service(2)               $95.48     4.2%  67.7%  4.0%   pts.
    The Ritz-Carlton(3)      $191.72     9.7%  68.7%  6.5%   pts.
    Composite North
     American Full-Service
     & Luxury(4)             $101.80     4.8%  67.8%  4.1%   pts.
    Residence Inn             $85.83     3.8%  76.4%  4.7%   pts.
    Courtyard                 $73.42     2.7%  66.8%  3.1%   pts.
    Fairfield Inn & Suites    $54.54     2.7%  64.5%  2.8%   pts.
    TownePlace Suites         $55.95     3.1%  69.6%  5.5%   pts.
    SpringHill Suites         $65.41     2.0%  66.9%  3.8%   pts.
    Composite North
     American Limited-
     Service(5)               $71.08     3.0%  69.0%  3.7%   pts.
    Composite - All(6)        $82.80     3.9%  68.5%  3.8%   pts.






                           Thirty-six Weeks Ended September 10, 2010 and
                                         September 11, 2009
                           ---------------------------------------------
                                               Average Daily
                                                   Rate
                                              --------------
                                                                          vs.
    Brand                                                           2010 2009
    -----                                                           ---- ----
    Marriott Hotels &
     Resorts                                                     $141.62 -1.7%
    Renaissance Hotels                                           $138.29 -2.8%
    Composite North
     American Full-
     Service(2)                                                  $141.02 -1.9%
    The Ritz-Carlton(3)                                          $279.22 -0.7%
    Composite North
     American Full-Service
     & Luxury(4)                                                 $150.23 -1.5%
    Residence Inn                                                $112.34 -2.6%
    Courtyard                                                    $109.90 -2.0%
    Fairfield Inn & Suites                                        $84.62 -1.7%
    TownePlace Suites                                             $80.33 -5.1%
    SpringHill Suites                                             $97.73 -3.7%
    Composite North
     American Limited-
     Service(5)                                                  $103.04 -2.5%
    Composite - All(6)                                           $120.84 -1.9%




    1  Statistics include only properties located in the Continental
    United States.
    2  Includes the Marriott Hotels & Resorts and Renaissance Hotels
    brands.
    3  Statistics for The Ritz-Carlton are for January through August.
    4  Includes the Marriott Hotels & Resorts, Renaissance Hotels and The
    Ritz-Carlton brands.
    5  Includes the Residence Inn, Courtyard, Fairfield Inn & Suites,
    TownePlace Suites and SpringHill Suites brands.
    6  Includes the Marriott Hotels & Resorts, Renaissance Hotels, The
    Ritz-Carlton, Residence Inn, Courtyard, Fairfield Inn & Suites,
    TownePlace Suites, and SpringHill Suites brands.
                                     A-8

                                         MARRIOTT INTERNATIONAL, INC.
                                              TIMESHARE SEGMENT
                                               ($ in millions)


                                                        Adjustments
                                                        -----------

                            As          As
                         Reported    Reported   Restructuring       Timeshare
                                                    Costs &
                        12 Weeks    12 Weeks         Other          Strategy -
                          Ended       Ended        Charges          Impairment
                         September   September
                             10,         11,       -------           Charges
                              2010        2009                       -------
                              ----        ----
    Segment
     Revenues
    ---------
    Base
     management
     fees                      $11         $11             $-               $-
    Sales and
     services
     revenue
      Development              135         138              -                -
      Services                  86          82              -                -
      Financing
       revenue
        Interest
         income -
         non-
         securitized
         notes                  11       11           -             -
        Interest
         income -
         securitized
         notes                  30           -              -                -
        Other
         financing
         revenue                 2          12             (3)               -
                               ---         ---            ---              ---
      Total
       financing
       revenue                  43          23             (3)               -
      Other
       revenue                  11          11              -                -
                               ---         ---            ---              ---
    Total sales
     and
     services
     revenue                   275         254             (3)               -
    Cost
     reimbursements             65          65              -                -
        Segment
         revenues             $351        $330            $(3)              $-
                              ====        ====            ===              ===


    Segment
     Results
    --------
    Base
     management
     fees                      $11         $11             $-               $-
    Timeshare
     sales and
     services,
     net                        56          16             (3)               -
    Timeshare
     strategy -
     impairment
         charges                 -        (614)             -              614
     Restructuring
     costs                       -          (7)             7                -
    General,
     administrative
     and other
         expense               (16)        (17)             -                -
    Gains and
     other
     income                      -           1              -                -
    Equity in
     losses                     (2)         (4)             1                -
    Interest
     expense                   (12)          -              -                -
    Timeshare
     strategy -
     impairment
        charges
         (non-
         operating)              -         (71)             -               71
     Noncontrolling
     interest                    -           4              -                -
        Segment
         results               $37       $(681)            $5             $685
                               ===       =====            ===             ====



    Contract
     Sales
    --------
    Company:
        Timeshare             $157        $164             $-               $-
        Fractional               5           7              -                -
        Residential              -           2              -                -
                               ---         ---            ---              ---
            Total
             company           162         173              -                -
    Joint
     ventures:
        Timeshare                -           -              -                -
        Fractional               2          (4)             7                -
        Residential              -         (17)            17                -
                               ---         ---            ---              ---
            Total joint
             ventures            2         (21)            24                -
           Total
            contract
            sales (1)         $164        $152            $24               $-
                              ====        ====            ===              ===







                                          As
                                       Adjusted        Percent
                                      12 Weeks         Better/
                                        Ended          (Worse)
                                       September
                                           11,        2010 vs.
                                                       Adjusted
                                        2009**           2009
                                        ------        ---------
    Segment Revenues
    ----------------
    Base management fees                     $11              -
    Sales and services revenue
      Development                            138             (2)
      Services                                82              5
      Financing revenue
        Interest income - non-
         securitized notes                    11              -
        Interest income -securitized
         notes                                 -              *
        Other financing revenue                9            (78)
                                             ---
      Total financing revenue                 20            115
      Other revenue                           11              -
                                             ---
    Total sales and services
     revenue                                 251             10
    Cost reimbursements                       65              -
        Segment revenues                    $327              7
                                            ====


    Segment Results
    ---------------
    Base management fees                     $11              -
    Timeshare sales and services,
     net                                      13            331
    Timeshare strategy -
     impairment
         charges                               -              -
    Restructuring costs                        -              -
    General, administrative and
     other
         expense                             (17)             6
    Gains and other income                     1           (100)
    Equity in losses                          (3)           (33)
    Interest expense                           -              *
    Timeshare strategy -
     impairment
        charges (non-operating)                -              -
    Noncontrolling interest                    4           (100)
        Segment results                       $9            311
                                             ===



    Contract Sales
    --------------
    Company:
        Timeshare                           $164             (4)
        Fractional                             7            (29)
        Residential                            2           (100)
                                             ---
            Total company                    173             (6)
    Joint ventures:
        Timeshare                              -              -
        Fractional                             3            (33)
        Residential                            -              -
                                             ---
            Total joint ventures               3            (33)
           Total contract sales (1)         $176             (7)
                                            ====            ===



    *  Percent cannot be calculated.
    ** Denotes non-GAAP financial measures. Please see pages A-18 and
    A-19 for additional information about our reasons for providing
    these alternative financial measures and limitations on their use.

    1  As Reported 12 Weeks Ended September 10, 2010 includes fractional
    contract cancellation allowances of ($1) million.  Gross contract
    sales for the 2010 third quarter were $165 million before the
    contract cancellation allowance.
                                                     A-9

                                        MARRIOTT INTERNATIONAL, INC.
                                             TIMESHARE SEGMENT
                                              ($ in millions)


                                                      Adjustments
                                                      -----------

                          As          As
                       Reported    Reported   Restructuring       Timeshare
                                                  Costs &
                      36 Weeks    36 Weeks         Other          Strategy -
                        Ended       Ended        Charges          Impairment
                       September   September
                           10,         11,       -------           Charges
                            2010        2009                       -------
                            ----        ----
    Segment
     Revenues
    ---------
    Base
     management
     fees                    $34         $32             $-               $-
    Sales and
     services
     revenue
      Development            430         441              4                -
      Services               253         232              -                -
      Financing
       revenue
        Interest
         income -
         non-
         securitized
         notes                30       34           -             -
        Interest
         income -
         securitized
         notes                99           -              -                -
        Other
         financing
         revenue
         (1)                   5           8             22                -
                             ---         ---            ---              ---
      Total
       financing
       revenue               134          42             22                -
      Other
       revenue                32          31              -                -
                             ---         ---            ---              ---
    Total
     sales and
     services
     revenue                 849         746             26                -
    Cost
     reimbursements          189         184              -                -
        Segment
         revenues         $1,072        $962            $26               $-
                          ======        ====            ===              ===


    Segment
     Results
    --------
    Base
     management
     fees                    $34         $32             $-               $-
    Timeshare
     sales and
     services,
     net                     156           9             25                -
    Timeshare
     strategy
     -
     impairment
         charges               -        (614)             -              614
     Restructuring
     costs                     -         (38)            38                -
    General,
     administrative
     and other
         expense             (48)        (57)             7                -
    Gains and
     other
     income                    -           1              -                -
    Equity in
     losses                  (10)         (6)             3                -
    Interest
     expense                 (40)          -              -                -
    Timeshare
     strategy
     -
     impairment
        charges
         (non-
         operating)            -         (71)             -               71
     Noncontrolling
     interest                  -          11              -                -
        Segment
         results             $92       $(733)           $73             $685
                             ===       =====            ===             ====



    Contract
     Sales
    --------
    Company:
        Timeshare           $463        $502             $-               $-
        Fractional            21          25              1                -
        Residential            6          (1)             4                -
                             ---         ---            ---              ---
            Total
             company         490         526              5                -
    Joint
     ventures:
        Timeshare              -           -              -                -
        Fractional             2          (9)            23                -
        Residential           (3)        (27)            27                -
                             ---         ---            ---              ---
            Total
             joint
             ventures         (1)        (36)            50                -
                             ---         ---            ---              ---
           Total
            contract
            sales (2)       $489        $490            $55               $-
                            ====        ====            ===              ===









                                          As
                                      Adjusted        Percent
                                      36 Weeks        Better/
                                        Ended         (Worse)
                                      September
                                         11,         2010 vs.
                                                      Adjusted
                                       2009**           2009
                                       ------        ---------
    Segment Revenues
    ----------------
    Base management fees                    $32              6
    Sales and services revenue
      Development                           445             (3)
      Services                              232              9
      Financing revenue
        Interest income - non-
         securitized notes                   34            (12)
        Interest income -
         securitized notes                    -              *
        Other financing revenue (1)          30            (83)
                                            ---
      Total financing revenue                64            109
      Other revenue                          31              3
                                            ---
    Total sales and services
     revenue                                772             10
    Cost reimbursements                     184              3
        Segment revenues                   $988              9
                                           ====


    Segment Results
    ---------------
    Base management fees                    $32              6
    Timeshare sales and
     services, net                           34            359
    Timeshare strategy -
     impairment
         charges                              -              -
    Restructuring costs                       -              -
    General, administrative and
     other
         expense                            (50)             4
    Gains and other income                    1            100
    Equity in losses                         (3)           233
    Interest expense                          -              *
    Timeshare strategy -
     impairment
        charges (non-operating)               -              -
    Noncontrolling interest                  11           (100)
        Segment results                     $25            268
                                            ===



    Contract Sales
    --------------
    Company:
        Timeshare                          $502             (8)
        Fractional                           26            (19)
        Residential                           3            100
                                            ---
            Total company                   531             (8)
    Joint ventures:
        Timeshare                             -              -
        Fractional                           14            (86)
        Residential                           -              *
                                            ---
            Total joint ventures             14           (107)
                                            ---
           Total contract sales (2)        $545            (10)
                                           ====





    *  Percent cannot be calculated.
    ** Denotes non-GAAP financial measures. Please see pages A-18 and
    A-19 for additional information about our reasons for providing
    these alternative financial measures and limitations on their use.
    1  As Reported 36 Weeks Ended September 11, 2009 and As Adjusted 36
    Weeks Ended September 11, 2009 include losses on notes sold of $1
    million and $1 million, respectively.
    2  As Reported 36 Weeks Ended September 10, 2010 includes fractional
    and residential contract cancellation allowances of ($8) million and
    ($7) million, respectively.  Gross contract sales for 2010 year-to-
    date were $504 million before the contract cancellation allowance.
                                                    A-10

                         MARRIOTT INTERNATIONAL, INC.
                               TIMESHARE SEGMENT
     AS ADJUSTED HAD ASU NOS. 2009-16 AND 2009-17 BEEN ADOPTED ON JANUARY
                                    3, 2009
                              THIRD QUARTER 2009
                                ($ in millions)


                                         Adjustments
                                         -----------

                          As     Restructuring       Timeshare          As
                      Reported      Costs &          Strategy -     Adjusted
                      12 Weeks       Other           Impairment     12 Weeks
                        Ended       Charges           Charges         Ended
                      September     -------           -------       September
                            11,                                           11,
                           2009                                       2009**
                           ----                                       ------
    Segment
     Revenues
    ---------
    Base
     management
     fees                   $11             $-               $-           $11
    Sales and
     services
     revenue
      Development           138              -                -           138
      Services               82              -                -            82
      Financing
       revenue
        Interest
         income -
         non-
         securitized
         notes               11           -             -         11
        Interest
         income -
         securitized
         notes                -              -                -             -
        Other
         financing
         revenue             12             (3)               -             9
                            ---            ---              ---           ---
      Total
       financing
       revenue               23             (3)               -            20
      Other
       revenue               11              -                -            11
                            ---            ---              ---           ---
    Total
     sales and
     services
     revenue                254             (3)               -           251
    Cost
     reimbursements          65              -                -            65
        Segment
         revenues          $330            $(3)              $-          $327
                           ====            ===              ===          ====


    Segment
     Results
    --------
    Base
     management
     fees                   $11             $-               $-           $11
    Timeshare
     sales and
     services,
     net                     16             (3)               -            13
    Timeshare
     strategy
     -
     impairment
         charges           (614)             -              614             -
     Restructuring
     costs                   (7)             7                -             -
    General,
     administrative
     and other
         expense            (17)             -                -           (17)
    Gains and
     other
     income                   1              -                -             1
    Equity in
     losses                  (4)             1                -            (3)
    Interest
     expense                  -              -                -             -
    Timeshare
     strategy
     -
     impairment
        charges
         (non-
         operating)         (71)             -               71             -
     Noncontrolling
     interest                 4              -                -             4
        Segment
         results          $(681)            $5             $685            $9
                          =====            ===             ====           ===



    Contract
     Sales
    --------
    Company:
        Timeshare          $164             $-               $-          $164
        Fractional            7              -                -             7
        Residential           2              -                -             2
                            ---            ---              ---           ---
            Total
             company        173              -                -           173
    Joint
     ventures:
        Timeshare             -              -                -             -
        Fractional           (4)             7                -             3
        Residential         (17)            17                -             -
                            ---            ---              ---           ---
            Total
             joint
             ventures       (21)            24                -             3
                            ---            ---              ---           ---
           Total
            contract
            sales,
            including
            joint
            ventures       $152         $24            $-       $176
                           ====            ===              ===          ====









                                        ASU Nos.             As
                                         2009-16          Adjusted
                                           And
                                         2009-17             For
                                       Adjustments        ASU Nos.
                                       -----------         2009-16
                                                        And 2009-17
                                                          12 Weeks
                                                            Ended
                                                          September
                                                         11, 2009**
                                                         ----------
    Segment Revenues
    ----------------
    Base management fees                        $-               $11
    Sales and services revenue
      Development                               11               149
      Services                                   -                82
      Financing revenue
        Interest income - non-
         securitized notes                       -                11
        Interest income -
         securitized notes                      36                36
        Other financing revenue                 (8)                1
                                               ---               ---
      Total financing revenue                   28                48
      Other revenue                              -                11
                                               ---               ---
    Total sales and services
     revenue                                    39               290
    Cost reimbursements                          -                65
        Segment revenues                       $39              $366
                                               ===              ====


    Segment Results
    ---------------
    Base management fees                        $-               $11
    Timeshare sales and
     services, net                              32                45
    Timeshare strategy -
     impairment
         charges                                 -                 -
    Restructuring costs                          -                 -
    General, administrative
     and other
         expense                                 -               (17)
    Gains and other income                       -                 1
    Equity in losses                             -                (3)
    Interest expense                           (17)              (17)
    Timeshare strategy -
     impairment
        charges (non-operating)                  -                 -
    Noncontrolling interest                      -                 4
        Segment results                        $15               $24
                                               ===               ===



    Contract Sales
    --------------
    Company:
        Timeshare                               $-              $164
        Fractional                               -                 7
        Residential                              -                 2
                                               ---               ---
            Total company                        -               173
    Joint ventures:
        Timeshare                                -                 -
        Fractional                               -                 3
        Residential                              -                 -
                                               ---               ---
            Total joint ventures                 -                 3
                                               ---               ---
           Total contract sales,
            including joint ventures            $-              $176
                                               ===              ====





                        MARRIOTT INTERNATIONAL, INC.
                        NON-GAAP FINANCIAL MEASURES
                            TIMESHARE INVENTORY
    AS ADJUSTED HAD ASU NOS. 2009-16 AND 2009-17 BEEN ADOPTED ON JANUARY
                                  3, 2009
                              ($ in millions)


                                           Adjustments
                                           -----------
                                                            As
                         Balance     As     ASU Nos.    Adjusted
                            at    Reported   2009-16       For
                          End of  Balance      And      ASU Nos.
                           2010      at      2009-17     2009-16
                                   Year-
                           Third    End                    And
                         Quarter     2009  Adjustments   2009-17
                        --------  ------   ----------- Balance at
                                                        Year-End
                                                        2009**(1)
                                                       ---------

    Finished goods (2)       $738     $721        $100       $821
    Work-in-process           147      198           -        198
    Land and
     infrastructure           552      507           -        507
        Total inventory    $1,437   $1,426        $100     $1,526
                           ======   ======        ====     ======



    ** Denotes non-GAAP financial measures. Please see pages A-18 and
    A-19 for additional information about our reasons for providing
    these alternative financial measures and limitations on their use.
    1  As Adjusted had ASU Nos. 2009-16 and 2009-17 (formerly referred to
    as FAS 166 & 167) been adopted on January 3, 2009.
    2  Includes completed inventory as well as an estimate of inventory
    we expect to acquire when we foreclose on defaulted notes.  The
    estimate of inventory we expect to acquire when we foreclose on
    defaulted notes for As Adjusted 2009 and As Reported 2010 include
    securitized and non-securitized notes, and As Reported 2009
    includes non-securitized notes.
                                     A-12

                   MARRIOTT INTERNATIONAL, INC.
                   NON-GAAP FINANCIAL MEASURES
                    EBITDA AND ADJUSTED EBITDA
                         ($ in millions)



                                           Fiscal Year 2010
                                           ----------------
                                                                      Total
                            First        Second        Third         Year to
                           Quarter       Quarter       Quarter         Date
                          --------      -------        -------       -------
    Net Income
     attributable to
     Marriott                  $83          $119           $83          $285
    Interest expense            45            44            41           130
    Tax provision               46            65            45           156
    Depreciation and
     amortization               39            42            40           121
    Less: Depreciation
     reimbursed by
     third-party owners         (3)           (3)           (2)           (8)
    Interest expense
     from unconsolidated
     joint ventures              5             5             6            16
    Depreciation and
     amortization from
     unconsolidated
     joint ventures              6             6             7            19
                               ---           ---           ---           ---
    EBITDA **                 $221          $278          $220          $719
                              ====          ====          ====          ====

    Increase over 2009
     Adjusted EBITDA             3%           26%           35%           20%


 
                                          Fiscal Year 2009
                                          ----------------

                                    First    Second   Third        Fourth
                                  Quarter    Quarter  Quarter      Quarter
                                   -------  -------   -------     -------
    Net Income (Loss)
     attributable to
     Marriott                         $(23)      $37    $(466)        $106
    Interest expense                    29        28       27           34
    Tax provision
     (benefit)                          33        44     (210)          68
    Tax provision,
     noncontrolling
     interest                            1         2        1            -
    Depreciation and
     amortization                       39        42       43           61
    Less: Depreciation
     reimbursed by                      (2)       (2)      (2)          (3)
    third-party owners
    Interest expense
     from
     unconsolidated
     joint ventures                      3         6        4            6
    Depreciation and
     amortization from
     unconsolidated
     joint ventures                      6         6        6            9
                                       ---       ---      ---          ---
    EBITDA **                           86       163     (597)         281

    Restructuring costs
     and other charges
           Severance                     2        10        4            5
           Facilities exit
            costs                        -        22        5            2
           Development
            cancellations                -         1        -            -
                                       ---       ---      ---          ---
              Total restructuring
               costs                     2        33        9            7
                                       ---       ---      ---          ---
           Impairment of
            investments and
            other, net of
            prior year
            reserves                    68      3     1        11
           Reserves for loan
            losses                      42         1        -            -
           Contract
            cancellation
            allowances                   4         1        1            3
           Residual interests
            valuation                   13        12       (3)          (2)
           System development
            write-off                    -         7        -            -
                                       ---       ---      ---          ---
              Total other charges      127        24       (1)          12
                                       ---       ---      ---          ---
    Total restructuring
     costs and other
     charges                           129        57        8           19
                                       ---       ---      ---          ---

    Timeshare strategy
     -impairment
     charges
           Operating
            impairments                  -         -      614            -
           Non-operating
            impairments                  -         -      138            -
                                       ---       ---      ---          ---
    Total timeshare
     strategy -
     impairment charges                  -         -      752            -
                                       ---       ---      ---          ---

    Adjusted EBITDA **                $215      $220     $163         $300
                                      ====      ====     ====         ====




                                     Total
                                     -----
    Net Income (Loss)
     attributable to
     Marriott                         $(346)
    Interest expense                    118
    Tax provision
     (benefit)                          (65)
    Tax provision,
     noncontrolling
     interest                             4
    Depreciation and
     amortization                       185
    Less: Depreciation
     reimbursed by                       (9)
    third-party owners
    Interest expense
     from
     unconsolidated
     joint ventures                      19
    Depreciation and
     amortization from
     unconsolidated
     joint ventures                      27
                                        ---
    EBITDA **                           (67)

    Restructuring costs
     and other charges
           Severance                     21
           Facilities exit
            costs                        29
           Development
            cancellations                 1
                                        ---
              Total restructuring
               costs                     51
                                        ---
           Impairment of
            investments and
            other, net of
            prior year
            reserves                     83
           Reserves for loan
            losses                       43
           Contract
            cancellation
            allowances                    9
           Residual interests
            valuation                    20
           System development
            write-off                     7
                                        ---
              Total other charges       162
                                        ---
    Total restructuring
     costs and other
     charges                            213
                                        ---

    Timeshare strategy
     -impairment
     charges
           Operating
            impairments                 614
           Non-operating
            impairments                 138
                                        ---
    Total timeshare
     strategy -
     impairment charges                 752
                                        ---

    Adjusted EBITDA **                 $898
                                       ====



                          MARRIOTT INTERNATIONAL, INC.
                          NON-GAAP FINANCIAL MEASURES
                           EBITDA AND ADJUSTED EBITDA
      AS ADJUSTED HAD ASU NOS. 2009-16 AND 2009-17 BEEN ADOPTED ON JANUARY
                                    3, 2009
                               THIRD QUARTER 2009
                                ($ in millions)


                                                                 As Adjusted
                                             Third    ASU Nos.        For
                                                      2009-16
                                            Quarter      and       ASU Nos.
                                                2009   2009-17   2009-16 and
                                               ---- Adjustments    2009-17
                                                    ----------- Third Quarter
                                                                    2009**
                                                                    ------
    Net (Loss) Income attributable
     to Marriott                               $(466)         $9        $(457)
    Interest expense                              27          17           44
    Tax benefit                                 (210)          6         (204)
    Tax provision, noncontrolling
     interest                                      1           -            1
    Depreciation and amortization                 43           -           43
    Less: Depreciation reimbursed by
     third-party owners                           (2)          -           (2)
    Interest expense from
     unconsolidated joint ventures                 4           -            4
    Depreciation and amortization
     from unconsolidated joint
     ventures                                      6           -            6
                                                 ---         ---          ---
    EBITDA **                                   (597)         32         (565)

    Restructuring costs and other
     charges
           Severance                               4           -            4
           Facilities exit costs                   5           -            5
           Development cancellations               -           -            -
                                                 ---         ---          ---
              Total restructuring costs            9           -            9
                                                 ---         ---          ---
           Impairment of investments and
            other, net of prior year
            reserves                               1           -            1
           Reserves for loan losses                -           -            -
           Contract cancellation allowances        1           -            1
           Residual interests valuation           (3)          -           (3)
           System development write-off            -           -            -
                                                 ---         ---
              Total other charges                 (1)          -           (1)
                                                 ---         ---          ---
    Total restructuring costs and
     other charges                                 8           -            8
                                                 ---         ---          ---

    Timeshare strategy -impairment
     charges
           Operating impairments                 614           -          614
           Non-operating impairments             138           -          138
                                                             ---          ---
    Total timeshare strategy -
     impairment charges                          752           -          752
                                                 ---         ---          ---

    Adjusted EBITDA **                          $163         $32         $195
                                                ====         ===         ====




    ** Denotes non-GAAP financial measures. Please see pages A-18 and
    A-19 for additional information about our reasons for providing
    these alternative financial measures and limitations on their use.
                                      A-14

                        MARRIOTT INTERNATIONAL, INC.
                        NON-GAAP FINANCIAL MEASURES
                         EBITDA AND ADJUSTED EBITDA
     2009 AS ADJUSTED HAD ASU NOS. 2009-16 AND 2009-17 BEEN ADOPTED ON
                    JANUARY 3, 2009 AND FORECASTED 2010
                              ($ in millions)



                                             2009
                                            Fiscal               As Adjusted
                                             Year    ASU Nos.         For
                                                      2009-16
                                            ------      and        ASU Nos.
                                                      2009-17    2009-16 and
                                                    Adjustments    2009-17
                                                    -----------  Fiscal Year
                                                                    2009**
                                                                    ------
    Net (Loss) Income attributable
     to Marriott                             $(346)         $(1)        $(347)
    Interest expense                           118           77           195
    Tax (benefit) provision                    (65)           -           (65)
    Tax provision, noncontrolling
     interest                                    4            -             4
    Depreciation and amortization              185            -           185
    Less: Depreciation reimbursed by
     third-party owners                         (9)           -            (9)
    Interest expense from
     unconsolidated joint ventures              19            -            19
    Depreciation and amortization
     from unconsolidated joint
     ventures                                   27            -            27
                                               ---          ---           ---
    EBITDA **                                  (67)          76             9

    Restructuring costs and other
     charges
           Severance                            21            -            21
           Facilities exit costs                29            -            29
           Development cancellations             1            -             1
                                               ---          ---           ---
              Total restructuring costs         51            -            51
                                               ---          ---           ---
           Impairment of investments and
            other, net of prior year
            reserves                            83            -            83
           Reserves for loan losses             43            -            43
           Contract cancellation allowances      9            -             9
           Residual interests valuation         20            -            20
           System development write-off          7            -             7
                                               ---          ---           ---
              Total other charges              162            -           162
                                               ---          ---           ---
    Total restructuring costs and
     other charges                             213            -           213
                                               ---          ---           ---

    Timeshare strategy -impairment
     charges
           Operating impairments               614            -           614
           Non-operating impairments           138            -           138
                                                            ---           ---
    Total timeshare strategy -
     impairment charges                        752            -           752
                                               ---          ---           ---

    Adjusted EBITDA **                        $898          $76          $974
                                              ====          ===          ====

    Increase over 2009 Adjusted
     EBITDA as Adjusted for ASU Nos.
     2009-16 and 2009-17





                                                     Range
                                                     -----
                                                   Estimated
                                                     EBITDA
                                                Full Year 2010
                                                --------------
    Net (Loss) Income attributable
     to Marriott                               $411        $424
    Interest expense                            190         185
    Tax (benefit) provision                     224         231
    Tax provision, noncontrolling
     interest                                     -           -
    Depreciation and amortization               180         180
    Less: Depreciation reimbursed by
     third-party owners                         (10)        (10)
    Interest expense from
     unconsolidated joint ventures               25          25
    Depreciation and amortization
     from unconsolidated joint
     ventures                                    30          30
                                                ---         ---
    EBITDA **                                 1,050       1,065

    Restructuring costs and other
     charges
           Severance                              -           -
           Facilities exit costs                  -           -
           Development cancellations              -           -
                                                ---         ---
              Total restructuring costs           -           -
                                                ---         ---
           Impairment of investments and
            other, net of prior year
            reserves                              -           -
           Reserves for loan losses               -           -
           Contract cancellation allowances       -           -
           Residual interests valuation           -           -
           System development write-off           -           -
                                                ---         ---
              Total other charges                 -           -
                                                ---         ---
    Total restructuring costs and
     other charges                                -           -
                                                ---         ---

    Timeshare strategy -impairment
     charges
           Operating impairments                  -           -
           Non-operating impairments              -           -
                                                ---         ---
    Total timeshare strategy -
     impairment charges                           -           -
                                                ---         ---

    Adjusted EBITDA **                       $1,050      $1,065
                                             ======      ======

    Increase over 2009 Adjusted
     EBITDA as Adjusted for ASU Nos.
     2009-16 and 2009-17                          8%          9%



                                   MARRIOTT INTERNATIONAL, INC.
                                   NON-GAAP FINANCIAL MEASURES
                                 ADJUSTED TOTAL DEBT NET OF CASH
                                         ($ in millions)




                                                     Balance   Balance
                                       Balance at       at        at
                                      End of 2010   Year-End  Year-End
                                          Third
                                         Quarter        2009      2008
                                        --------        ----      ----
    Total debt                              $2,726    $2,298    $3,095
    Cash and cash equivalents                 (223)     (115)     (134)
    Total debt net of cash**                 2,503     2,183     2,961
    Less the impact of ASU Nos.
     2009-16 and 2009-17                      (912)        -         -
    Adjusted total debt net of cash**
     (a)                                    $1,591    $2,183    $2,961
                                            ======    ======    ======





                                            Better /(Worse)
                                                 Change
                                              ---------------
                                           Balance at End of
                                          2010 Third Quarter
                                            as Compared to
                                            --------------
                                        Balance
                                           at
                                         Year-      Balance
                                           End      at Year-
                                          2009      End 2008
                                        --------      --------
    Total debt                             $(428)          $369
    Cash and cash equivalents                108             89
    Total debt net of cash**                (320)           458
    Less the impact of ASU Nos.
     2009-16 and 2009-17                     912            912
    Adjusted total debt net of cash**
     (a)                                    $592         $1,370
                                            ====         ======



    (a)  Excludes the impact of the update to ASU Nos. 2009-16 and 2009-17.
    ** Denotes non-GAAP financial measures. Please see pages A-18 and
    A-19 for additional information about our reasons for providing
    these alternative financial measures and limitations on their use.
                                               A-16

                         MARRIOTT INTERNATIONAL, INC.
                         NON-GAAP FINANCIAL MEASURES
                               INTEREST EXPENSE
    AS ADJUSTED HAD ASU NOS. 2009-16 AND 2009-17 BEEN ADOPTED ON JANUARY
                                   3, 2009
                              THIRD QUARTER 2009
                               ($ in millions)


                                              As Adjusted
                                                For ASU
                                                 Nos.
                                                2009-16
                     As                           And
                  Reported      ASU Nos.      2009-17 12
                  12 Weeks       2009-16         Weeks
                    Ended          and           Ended
                  September      2009-17      September
                  11, 2009     Adjustments    11, 2009**
                 ---------       -----------      -----------

    Interest
     Expense            $27              $17              $44
                        ===              ===              ===


    ** Denotes non-GAAP financial measures. Please
     see pages A-18 and A-19 for additional
     information about our reasons for providing
     these alternative financial measures and
     limitations on their use.
                             A-17


MARRIOTT INTERNATIONAL, INC.

NON-GAAP FINANCIAL MEASURES

In our press release and schedules, and on the related conference call, we report certain financial measures that are not prescribed or authorized by United States generally accepted accounting principles ("GAAP"). We discuss management's reasons for reporting these non-GAAP measures below, and the press release schedules reconcile the most directly comparable GAAP measure to each non-GAAP measure that we refer to (identified by a double asterisk on the preceding pages). Although management evaluates and presents these non-GAAP measures for the reasons described below, please be aware that these non-GAAP measures have limitations and should not be considered in isolation or as a substitute for revenue, operating income, income from continuing operations, net income, earnings per share or any other comparable operating measure prescribed by GAAP. In addition, these non-GAAP financial measures may be calculated and/or presented differently than measures with the same or similar names that are reported by other companies, and as a result, the non-GAAP measures we report may not be comparable to those reported by others.

Adjusted Measures That Exclude Certain Charges, Costs, and Other Expenses. Management evaluates non-GAAP measures that exclude the impact of Timeshare strategy - impairment charges incurred in the 2009 third quarter, restructuring costs and other charges incurred in the 2009 first through fourth quarters, and certain tax expenses incurred in the 2009 first through third quarters, because those non-GAAP measures allow for period-over-period comparisons of our on-going core operations before material charges. These non-GAAP measures also facilitate management's comparison of results from our on-going operations before material charges with results from other lodging companies.

Timeshare Strategy - Impairment Charges. In response to the difficult business conditions that the Timeshare segment's timeshare, luxury residential, and luxury fractional real estate development businesses experienced, we evaluated our entire Timeshare portfolio in the 2009 third quarter. In order to adjust the business strategy to reflect current market conditions at that time, on September 22, 2009, we approved plans for our Timeshare segment to take the following actions: (1) for our luxury residential projects, reduce prices, convert certain proposed projects to other uses, sell some undeveloped land, and not pursue further Marriott-funded residential development projects; (2) reduce prices for existing luxury fractional units; (3) continue short-term promotions for our U.S. timeshare business and defer the introduction of new projects and development phases; and (4) for our European timeshare and fractional resorts, continue promotional pricing and marketing incentives and not pursue further development. As a result of these decisions, we recorded third quarter 2009 pretax charges totaling $752 million in our Consolidated Statements of Income ($502 million after-tax), including $614 million of pretax charges impacting operating income under the "Timeshare strategy-impairment charges" caption, and $138 million of pretax charges impacting non-operating income under the "Timeshare strategy-impairment charges (non-operating)" caption.

Restructuring Costs and Other Charges. During the latter part of 2008 we experienced a significant decline in demand for hotel rooms both domestically and internationally due, in part, to the financial crisis and the dramatic downturn in the economy. Our capital intensive Timeshare business was also hurt by the downturn in market conditions and particularly, the significant deterioration in the credit markets. These declines resulted in reduced management and franchise fees, cancellation of development projects, reduced timeshare contract sales, contract cancellation allowances, and charges and reserves associated with expected fundings, loans, Timeshare inventory, accounts receivable, contract cancellation allowances, valuation of Timeshare residual interests, hedge ineffectiveness, and asset impairments. We responded by implementing various cost saving measures which resulted in first, second, third and fourth quarter 2009 restructuring costs of $2 million, $33 million, $9 million, and $7 million, respectively, that were directly related to the downturn. We also incurred other charges in the 2009 first, second, and fourth quarters totaling $127 million, $24 million, and $12 million respectively, as well as $1 million in net other credits in the 2009 third quarter, that were directly related to the downturn, including asset impairment charges, accounts receivable and guarantee charges, reserves associated with loans, reversal of the liability related to expected fundings, Timeshare contract cancellation allowances, and charges related to the valuation of Timeshare residual interests.

Certain Tax Expenses. Certain tax expenses included non-cash charges of $26 million in the 2009 first quarter, $17 million in the 2009 second quarter, and $13 million in the 2009 third quarter primarily related to the treatment of funds received from certain foreign subsidiaries, an issue we are contesting with the Internal Revenue Service.

Earnings Before Interest, Taxes, Depreciation and Amortization. Earnings before interest, taxes, depreciation and amortization ("EBITDA") reflects earnings excluding the impact of interest expense, provision for income taxes, depreciation and amortization. Management considers EBITDA to be an indicator of operating performance because we use it to measure our ability to service debt, fund capital expenditures, and expand our business. We also use EBITDA, as do analysts, lenders, investors and others, to evaluate companies because it excludes certain items that can vary widely across different industries or among companies within the same industry. For example, interest expense can be dependent on a company's capital structure, debt levels and credit ratings. Accordingly, the impact of interest expense on earnings can vary significantly among companies. The tax positions of companies can also vary because of their differing abilities to take advantage of tax benefits and because of the tax policies of the jurisdictions in which they operate. As a result, effective tax rates and provision for income taxes can vary considerably among companies. EBITDA also excludes depreciation and amortization because companies utilize productive assets of different ages and use different methods of both acquiring and depreciating productive assets. These differences can result in considerable variability in the relative costs of productive assets and the depreciation and amortization expense among companies.

Both EBITDA and Adjusted EBITDA (described below) exclude certain cash expenses that we are obligated to make.

Adjusted EBITDA. Management also evaluates Adjusted EBITDA as an indicator of operating performance. Adjusted EBITDA excludes: (1) Timeshare strategy - impairment charges of $752 million incurred in the 2009 third quarter; and (2) the 2009 restructuring costs and other charges of $19 million from the fourth quarter, $8 million from the third quarter, $57 million from the second quarter and $129 million from the first quarter. Management excludes these Timeshare strategy-impairment charges and restructuring costs and other charges for the reasons noted above under "Adjusted Measures That Exclude Certain Charges, Costs, and Other Expenses."

Adjusted Measures that Exclude the Impact of New Accounting Standards or Reflect Their Early Adoption. As of the first day of fiscal year 2010, we adopted Accounting Standards Update ("ASU") No. 2009-16, "Transfers and Servicing (Topic 860): Accounting for Transfers of Financial Assets" (formerly known as FAS No. 166) and ASU No. 2009-17, "Consolidations (Topic 810): Improvements to Financial Reporting by Enterprises Involved with Variable Interest Entities" (formerly known as FAS No. 167), which required consolidating previously securitized pools of Timeshare notes and impacts the ongoing accounting for those notes. Management evaluates non-GAAP measures that exclude the impact of these standards in the current year or include the impact of these standards as if we had adopted them early in order to better perform year-over-year comparisons on a comparable basis.

Total Debt Net of Cash (or "Net Debt") and Adjusted Total Debt Net of Cash. Total debt net of cash reflects total debt less cash and cash equivalents. Management considers total debt net of cash to be a more accurate indicator of the net debt that must be repaid or refinanced at maturity (as it gives consideration to cash resources available to retire a portion of the debt when due). In addition, Management evaluates adjusted total debt net of cash, which excludes the debt that was consolidated as a result of adopting ASU Nos. 2009-16 and 2009-17, because that debt is non-recourse to the Company and is not supported by the Company's cash flows. Management believes that these financial measures provide a clearer picture of the future demands on cash to repay debt and uses these measures in making decisions regarding its borrowing capacity and future refinancing needs. Management also evaluates adjusted total debt net of cash for the reason stated in the previous paragraph.

SOURCE Marriott International, Inc.

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