Group Business Details
Ryan Meliker – MLV & Co.: I appreciate the color on group that you started with on, but I was hoping you might be able to give us a little bit more detail in terms of what’s going on there. If I missed, I apologize, but can you give us how group is pacing in the back half of the year? And then in the 2014 and 2015, you talked about larger groups coming in stronger or longer term groups coming in stronger. Right now, are you seeing that on the association front or is that purely corporate? Any color there will be helpful.
Arne M. Sorenson – President and CEO: Perfectly appropriate first question I would think. You could tell from the prepared comments that there is, we think, a number of different reasons that are impacting group business. We’d love to be able to provide you with a little bit more clarity and tell you that we’ve got a really concrete sense of exactly what’s going on but we’re watching the same sort of data that you are. I think on the negative side, if you look at what happened in Q2 in the quarter, for the quarter bookings, you look at group revenue paid and stayed and you see a declining trend from positive 17 in April albeit benefited by Easter timing to negative 5 in June. You see our full-year numbers – we look at the Q4 being actually fairly strong with group revenue on the books up about 6% from the same time last year for last year’s fourth quarter, but Q3 essentially been flattish – that too basically says, what’s going on in the short-term. I’ll give you a little bit more data before bringing this around to some conclusions. When we look at booking in Q2 of 2013 for all future periods, group business only and this is for the Marriott brand, Q2 bookings were up 12.9%. It’s a huge number. Now, for the rest of ’13 compared to last year’s Q2 for the rest of ’12, they were up only 0.6%. So you see a stark difference between bookings for the balance of 2013 compared to bookings for 2014 in all future years which were up above 18% in the quarter. That’s the kind of data that we’re looking at that tells us that it is not systemic, it’s not long-term, it is a short-term dynamic we think. That short-term dynamic we think is partly impacted by the bookings that were done less robustly a few years ago when economic conditions were weaker. We think it’s probably partly driven by the high occupancy and the strength in transient that’s available, and therefore, we’ve probably got a little less aggression going after some group business and to some extent some unavailability. And I suspect it’s also driven to some extent by some tentativeness among group customers. And that probably is a little more in the association side than the corporate side, but we don’t see a dramatic difference between the two. All-in-all, I think what we can say with the most confidence is, we think it is short-term and we do not think it’s systemic, but we’ll continue to watch it and report to you as we go along.
Ryan Meliker – MLV & Co.: Then I guess, just as a quick follow-up on that, given the challenges with short-term bookings, are you hoping to enter 2014 with more group on the books than you historically would have been looking for with uncertainties surrounding short-term filling in the gaps in ’14?
Arne M. Sorenson – President and CEO: Well, I mean, if the question is, are we trying to group up ’14 compared to what we would have done in ’13, I think the answer is probably not; we’re still a little early to be talking about ’14. But I think transient demand is very powerful bright spot if we get towards the end of the fall and when we’re doing our planning and continue to see transient perk along at that kind of pace, I think we will be captured by the strength of the business and we’ll not look to group up in a way that would push some of that business away. Having said that, obviously, the group houses, particularly the big group houses are aggressively going after bookings, and I think today for 2014, our revenue on the books is up only about 2% from where it would have been for ’13 a year ago. So that’s not great, and we’ll keep pushing that.
Jeffrey Donnelly – Wells Fargo: Arne, I am curious, do you think we’ve seen the worst of the pullback from other governments in terms of room demand, or do you think there is going to be more to come?
Arne M. Sorenson – President and CEO: That’s a good question. Hopefully, we’ve seen the worst. At the same time, I don’t think any of us should think it’s going to get much better anytime soon. We talked about in the group side government going from 5% of our group business in the Marriott brand to about 2% now. I suppose in theory it could go to zero, but it shouldn’t. I mean, there is some level of government business that even the most extreme waste against government spending should be careful about cutting and is really necessary for that organizational function as well as it can. So, there is probably some downside risk, but maybe the only good news about how weak it is, there is not much left to give up…
Jeffrey Donnelly – Wells Fargo: I guess as a follow-up, I mean to switch gears, can you talk about the process of bringing AC Hotels and maybe the marquee brands to the U.S., and how you are thinking about positioning those versus your existing brands and competitors from a, I guess, price and customer profile and maybe where you think your unit potential ultimately is.
Arne M. Sorenson – President and CEO: We made no decision by the way to bring MOXY to the United States, at least not yet. We’re off to a great start in Europe with MOXY. We announced it at the lodging conference in Berlin in March, and with partnership that we’ve got with the Inter IKEA real estate folks, we are well underway and I think have got a dozen or so specific MOXYs that either have already been approved or are pending committee approval. I think we will open our first roughly at the end of the first quarter of 2014. So we feel really good about that but we want to make sure we get that brand launched well before we start to broaden its geographic footprint, and I don’t think we will think aggressively about moving MOXY into other markets around the world until we get underway in Europe. AC has been interesting. AC, we brought into, Antonio Catalan’s company, about two and a half years ago; obviously a big focus in Spain; secondary focus in Italy. Our timing in Spain, in retrospect, wasn’t spectacular given that Spain has continued to get worse and worse. On the other hand, we’ve been really pleased with the quality of the hotels and the way the brand fits in; and have probably opened another half a dozen or so ACs outside of Spain and Italy, France being the most prominent market in Europe. I think as our U.S. franchisees will obviously have a long-term relationship with us, looking what we’re doing with the AC brand. They started pushing us, maybe a year ago or so to think about bringing AC to the United States. Sometimes that comment was specifically directed at AC and sometimes it was a more generic which was, Marriott, we would really like for you to have another brand to play in the upscale tier that probably has more of a lifestyle flavor to it. Those sets of comments caused us to start to think seriously about AC and talking to our focus about our partners here, whether or not they were really interested in that, and upon during the work that we needed to do, we saw a great appetite. So that’s why we’ve got two dozen leased hotels; very specific hotels that are either approved or under negotiation and we feel really good about the way that brand is likely to grow in the United States.
A Closer Look: Marriott International Earnings Cheat Sheet>>