The recent economic meltdown had a grave effect on almost all industries. For the timeshare industry, it resulted to low sales and many owners trying to get out of their timeshares. Meanwhile, one of the big players in this industry is the Marriott International, Inc. It is a worldwide operator and franchisor of a broad portfolio of hotels and related lodging facilities including timeshares. Recently, this company which last paid a cash dividend to shareholders in February 2009, says it is reinstating a cash payment after trimming company debt.
The Marriott International, Inc. will pay a cash dividend of 4 cents per share on its Class A common stock, payable on April 9 to shareholders of record on Feb. 19. According to Marriott’s chief operating officer Arne Sorenson, given the level of economic uncertainty and the higher leverage ratios faced by the company in 2009, the board of directors decided it would be prudent to pay the last three quarterly dividends in stock rather than cash. Marriott reduced its debt by almost $800 million last year, to $2.3 billion. As Sorenson said, the board of directors agreed with management’s recommendation to return to a cash dividend because of the debt reduction.
Next week, Marriott will report fourth quarter and full year results. This hotel and timeshare giant posted a $466 million third-quarter loss after a significant write-down of its timeshare business.
The economic downturn that broke out in the late of 2007 had a severe effect on the timeshare industry. This drove the owners to get rid of their timeshares while some even hire a timeshare transfer company such as the Transfer Smart. On the other hand, the timeshare operators suffered from low sales and led them to restructure their respective companies. But as the economy is slowly recovering this year, most of these companies already showed optimism. As Marriott’s Sorenson told the investors last month, the company would begin to see revenue growth this year.