NEW YORK (AP) -- Marriott International Inc. says it turned a better-than-expected profit in its first quarter thanks to higher room rates and a return of events by large groups.
The company, based in Bethesda, Md., said Wednesday that it earned $136 million, or 43 cents per share, in the three-month period that ended March 31. That's up from $104 million, or 31 cents per share, a year ago. A change in the company's fiscal year meant nine extra days in the quarter this year compared to last.
Revenue in the quarter rose 23 percent to $3.14 billion, topping Wall Street's expectations for earnings of 40 cents per share and revenue of $2.94 billion, according to FactSet.
The company's revenue per available room — or REVPAR — was $97.48, up 4.6 percent from the prior year. That key figure increased thanks to slightly higher occupancies and a 3.8 percent gain in the rates charged to guests.
The largest gains came at its international luxury hotels, which saw a 4 percent climb in occupancy and a 10.7 percent gain in REVPAR. Europe continued to drag, with a 1.8 percent drop in REVPAR.
The company expects that figure to increase 4.5 to 7 percent in North America, 3 to 5 percent outside North America and 4 to 7 percent worldwide for the full year.
Marriott doesn't own most of the hotels in its system but makes money off either managing or franchising its 18 brands; including Ritz-Carlton, Fairfield Inn & Suites, Courtyard, SpringHill Suites and Renaissance.
The largest gains in North America came from its high-end Ritz-Carlton brand.
"Our business has seen dramatic recovery in the past few years," Arne M. Sorenson, Marriott president and CEO said in a statement. "Our business is highly resilient. Our first quarter fee revenue exceeded our expectations."
Lucrative corporate events, retreats and other group bookings that were frowned upon during the depths of the recession are also returning.
The group booking pace for the Marriott Hotels and Resorts brand in North America for the remainder of 2013 is up 4 percent, something the company said reflects a "somewhat more cautious short-term corporate group demand." Things look better next year, with the 2014 booking pace up 5 percent, compared to a 4 percent decline just a year ago.
The company's worldwide pipeline of hotels under construction, awaiting conversion or approved for development increased to approximately 800 properties with over 135,000 rooms at quarter-end.
Marriott shares fell 58 cents to close at $42.48 amid a broader market decline.