10 Jul Deliverable 1 – Core Managerial Finance Concepts and Data Assignment Content Competency Interpret core managerial finance concepts and data. Student Success Criteria
Deliverable 1 – Core Managerial Finance Concepts and Data
Assignment Content
- Competency
Interpret core managerial finance concepts and data.
Student Success Criteria
View the grading rubric for this deliverable by selecting the “This item is graded with a rubric” link, which is located in the Details & Information pane.Scenario
To learn more about the travel and leisure industry, open the Mergent Online database: https://guides.rasmussen.edu/mergent. Click on the Industry Analysis tab near the top of the page. Then select Reports. Next, click on Mergent Reports. Scroll down to the most recent Travel and Leisure report. Download the report. This will open the North American Travel and Leisure Report. Scroll through to read information about travel and leisure in the United States and Canada.At a high-level, several items from recent operations seem relevant. First, the company’s share of the U.S. hotel market has been stable for several years, but you are aware that the leadership team and board of directors would like to grow the business. The executives have considered both U.S. and international growth opportunities in the past, but they have not yet selected a strategy to pursue.
Next, the executive team is also focused on cost control to maintain the profitability of the current U.S. operations. The expenses that have increased the most in recent years have been food products and employee wages.
Finally, the executive team and board have been concerned about the emergence and growth of new types of competitors like Airbnb. Airbnb’s business model utilizing residential properties for consumer rental purposes has disrupted the industry and raised questions about the value proposition of the traditional hotel chain model.Instructions
To learn more about the travel and leisure industry, access the Mergent Online database via Rasmussen’s Library and Learning Services. Click on the Industry Analysis menu option, then select the Hospitality & Tourism and click Search. Multiple industry reports for North America, and other regions will be available. Select/view and read the most recent North America report.After reading the Mergent industry report for North America, choose one relevant economic factor as the presentation topic. For example, the presentation could examine an economic factor related to the costs of operating a hotel chain such as inflation on food products. Next, research a valid, external source of data on the selected topic and collect several data points to use in a visual such as a chart or graph. An example source for relevant food product data is the U.S. Bureau of Labor Statistics Consumer Price Index (food-related inflation factors available).
Prepare a PowerPoint presentation deck that includes the following:
- Title slide;
- One slide describing the business being addressed (such as company growth, cost management, competitive environment, etc.) and its importance to the company;
- One slide describing the industry data related to the selected topic;
- One slide describing the economic data and source(s) identified for the topic;
- One slide containing a visual (chart, graph, etc.) of the economic data;
- Include a brief explanation or interpretation of the visual.
- Example – a trend chart showing 5-years of inflation on food products with an explanation of the expected future effect on the prices that your hotel chain must charge customers for food.
- Appendix slide with an APA style reference list for all data sources used.
- Resources
To learn more about the travel and leisure industry, access the Mergent Online database via Rasmussen’s Online Library. Use the information in this FAQ: https://rasmussen.libanswers.com/faq/317317 to learn how to locate the Mergent Report for the Travel & Leisure industry. Select/view and read the most recent Travel & Leisure report.After reading the Travel & Leisure Mergent Industry Report for North America, choose one relevant economic factor as the presentation topic.
- For assistance on developing a PowerPoint presentation, visit Rasmussen Library and Learning Services.
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F O L LO W U S
ICB code 5700
Travel and Leisure
A company and industry analysis
North America
MARCH 2020
Current Environment • The US travel and leisure sector declined slightly, with tourist arrivals totaling 37.08 million in the first six months of 2019, 1.70% down from 37.72 million a year earlier.
• In the six months ending in March 12, 2020, the top travel and leisure stocks in the US fell by 34.28%.
• In the six months ending in March 9, 2020, key Canadian travel and leisure stocks fell by 22.77%.
• Hoteliers continued a deal-making spree as the hotel industry became more competitive. • Marriott International (NASDAQ: MAR) continued to reign as the world’s largest hotel company.
• Blackstone REIT Inc, a subsidiary of Blackstone Group Inc (NYSE: BX), a private equity company acquires Bellagio Hotel & Casino, a subsidiary of MGM Resorts International (NYSE: MGM), a hotel company for US$4.25 billion.
Industry Profile • The US travel and tourism sector is among the country’s largest service industries, comprising several inter-related businesses such as lodging properties, airlines, casinos, restaurants, cruise lines, car rental firms, travel agents and tour operators, among others.
• The travel industry contributed 2.90% of total GDP and directly generated about US$170.90 billion in taxes for local, state and federal governments in 2018, according to the US Travel Association.
• The US travel and leisure sector employed 16.72 million in September 2019. • The market capitalization of the top US travel and leisure companies totaled US$397.90 billion on March 9, 2020.
• The market capitalization of the top Canadian travel and leisure companies totaled C$27.41 billion (US$19.76 billion) on March 6, 2020.
Market Trends & Outlook • Hotel companies are venturing into regions such as Asia-Pacific and East Asia to take advantage of its opportunities and long-term growth prospects and to broaden their customer base and market share.
• Cruise companies are overhauling their fleet to improve capacity and passenger experience. • The home-sharing model has become extremely popular in recent years and appears to be going from strength to strength.
• Canadian travel and leisure companies seek to benefit from the emergence of the cannabis tourism industry in Canada.
• Canada’s domestic tourism sector is likely to grow, with improving domestic demand, a weak Canadian dollar and other market drivers.
CURRENT ENVIRONMENT UNITED STATES • Sector Overview • Sector Performance • Sector Indexes • Leading Companies • Mergers, Acquisitions and Alliances
CURRENT ENVIRONMENT CANADA • Sector Overview • Sector Performance • Leading Companies • Mergers, Acquisitions and Alliances
INDUSTRY PROFILE UNITED STATES • Industry Size and Value • Employment • Market Capitalization
INDUSTRY PROFILE CANADA • Industry Size and Value • Market Capitalization • Employment • Trade Activity
ENVIRONMENTAL, SOCIAL AND GOVERNANCE • Hoteliers’ Focus on Sustainable Operations
• ESG Investment in Leisure and Travel Will Continue to Grow
• Company ESG Ratings
MARKET TRENDS & OUTLOOK UNITED STATES • Hotel Companies Expand Overseas • Cruise Companies Upgrade Their Fleet • Home-Sharing Grows in Popularity • Market Outlook
MARKET TRENDS & OUTLOOK CANADA • Canada’s Cannabis Tourism Grows • Culinary Tourism Continues to Develop • Indigenous Tourism Thrives • Market Outlook
CURRENCY CONVERSION TABLE THE SCOPE OF THIS REPORT KEY REFERENCES COMPARATIVE DATA INDUSTRY REPORTS COVERAGE
Contents Key Points
2Mergent by FTSE Russell
Travel and Leisure
http://www.mergent.com
http://www.mergentindustryreports.com/
Copyright Copyright 2020 by FTSE Russell All Information contained herein is copyrighted in the name of FTSE Russell and none of such information may be copied or otherwise reproduced, repackaged, further transmitted, transferred, disseminated, redistributed or resold, or stored for subsequent use for any such purpose, in whole or in part, in any form or matter or by any means whatsoever, by any person without prior written consent from FTSE Russell.
Disclaimer All information contained herein is obtained by FTSE Russell, from sources believed by it to be accurate and reliable. Because of the possibility of human and mechanical error as well as other factors, however, such information is provided “as is” without warranty of any kind. NO WARRANTY, EXPRESS OR IMPLIED, AS TO THE ACCURACY, TIMELINESS, COMPLETENESS, MERCHANTABILITY OR FITNESS FOR ANY PARTICULAR PURPOSE OF ANY INFORMATION IS GIVEN OR MADE BY FTSE RUSSELL IN ANY FORM OR MANNER WHATSOEVER. Under no circumstances shall FTSE RUSSELL have any liability to any person or entity for (a) any loss or damage in whole or in part caused by, resulting from, or relating to, any error (negligent or otherwise) or other circumstance involved in procuring, collecting, compiling, interpreting, analyzing, editing, transcribing, transmitting, communicating or delivering any such information, or (b) any direct, indirect, special, consequential or incidental damages whatsoever, even if FTSE Russell is advised in advance of the possibility of such damages, resulting from the use of, or inability to use, any such information.
Travel and Leisure North America
Publisher FTSE Russell
Director John Pedernales
Research Analyst Norman Lau Sze Siang
Website http://www.mergentarchives.com/ http://www.mergentindustryreports.com/
Customer Service 1800 342 5647 or 704 559 7601 email: [email protected]
Sales Enquiries For sales inquiries contact your local Mergent Representative
The North America Industry Reports are published by FTSE Russell, headquartered in Fort Mill, South Carolina, USA. Each industry sector report is updated every six months. FTSE Russell, a leading provider of global business and financial information on publicly traded companies, operates sales offices in key North American cities as well as London, Tokyo and Melbourne.
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Travel and Leisure
Trade groups that represent thousands of businesses and millions of jobs also aim to collaborate with the US Government to improve tourism in the US with measures such as endorsing friendlier visa and border-security policies. Other
organizations involved in the coalition include the International Association of Exhibitions and Events, the National Restaurant Association and the National Retail Federation.
Sector Overview
The US travel and leisure sector declined slightly, with tourist arrivals totaling 59.56 million in the first nine months of 2019, 1.30% down from 60.34 million a year earlier according to the National Travel and Tourism Office (NTTO). Travel and tourism contributed US$1.10 trillion to the country’s economy in 2018, the US Travel Association reported. Tourist arrivals from China also fell slightly due the setbacks in trade relations between China and the US. Tourist arrivals from China amounted to 1.43 million in the first six months of 2019, down 3.38% from 1.48 million last year according to the National Travel and Tourism Office (NTTO). NTTO figures showed that leisure travel spending in the US totaled US$761.70 billion in 2018, comprising of 69.25% of total travel spending in the US. The US Government has been stepping up efforts to further improve the travel and leisure industry as it gains prominence in the US economy.
Current Environment United States
Table 1: Closing Share Prices for Leading US Travel and Leisure Companies
Company September 12, 2019 March 12, 2020 Percentage Change Hilton Worldwide (NYSE: HLT) US$94.77 US$76.72 -19.05%
McDonald’s (NYSE: MCD) US$212.15 US$170.13 -19.81%
Las Vegas Sands (NYSE: LVS) US$60.15 US$44.15 -26.60%
Marriott International (NYSE: MAR) US$132.51 US$93.71 -29.28%
Yum! Brands (NYSE: YUM) US$113.27 US$78.45 -30.74%
Starbucks Corporation (NASDAQ: SBUX) US$92.06 US$62.10 -32.54%
Southwest Airlines (NYSE: LUV) US$54.98 US$36.07 -34.39%
Booking Holdings (NASDAQ: BKNG) US$2,041.41 US$1,280.40 -37.28%
Delta Air Lines (NYSE: DAL) US$59.44 US$33.71 -43.29%
Carnival Corporation & Plc (NYSE: CCL) US$49.62 US$14.97 -69.83%
Average Rise/Fall -34.28% Source: Mergent Analysis
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Travel and LeisureCurrent Environment United States
Sector Performance
From September 12, 2019, to March 12, 2020, the stock prices of major US travel and leisure stocks tracked by Mergent fell by an average of 34.28% over the period due to the slump in the travel and leisure sector caused by the COVID-19 virus outbreak. Carnival Corporation & Plc (NYSE: CCL) shares fared the worst among the top travel and leisure companies, with a price decline of 69.83%, from US$49.62 to US$14.97.
Sector Indexes The FTSE global equity index provides capital growth measurement data for the travel and leisure industry with mixed
review periods and considers the ancillary impact of the sector on the global and North American economies. It showed that the travel and leisure industry had a total return of -29.19% in the three months ended March 16, 2020. This indicates a decline in the overall travel and leisure industry in the span of three months. The industry had a -29.94% return in the year to March 16, 2020.
Leading Companies
Top travel and leisure companies — analyzed by Mergent based on their market capitalization — continued to progress in fiscal 2018. The total revenue of the mentioned conglomerates was US$194.66 billion, up 13.94% from US$170.84
Table 2: Index Performance of Travel and Leisure Industries (Total Return)
FTSE Index Name Value Return 1 Day 1 Week 1 Month 3 Months Year-to-Date
Travel and Leisure US$512.78 2.42% -14.79% -29.23% -29.19% -29.94% Note: Based on end-of-day data for the Total Return Index as of March 16, 2020 Source: FTSE Equity Index
Table 3: Financials of Leading Travel and Leisure Companies for Fiscal 2018
Travel and Leisure Companies
Revenue % Change
Net Income/Loss % Change2018 2017 2018 2017
McDonald’s (NYSE: MCD)
US$21.03 billion
US$22.82 billion
-7.84 US$5.92 billion
US$5.19 billion
14.07
Yum! Brands (NYSE: YUM)
US$5.69 billion
US$5.88 billion
-3.23 US$1.54 billion
US$1.34 billion
14.93
Las Vegas Sands (NYSE: LVS)
US$13.73 billion
US$12.88 billion
6.60 US$2.41 billion
US$2.81 billion
-14.23
Marriott International (NYSE: MAR)
US$20.76 billion
US$5.13 billion
304.68 US$1.91 billion
US$1.37 billion
39.42
Booking Holdings (NASDAQ: BKNG)
US$14.53 billion
US$12.68 billion
14.59 US$4 billion US$2.34 billion
70.94
Hilton Worldwide (NYSE: HLT)
US$8.91 billion
US$9.14 billion
-2.52 US$764 million
US$1.26 billion
-39.37
Starbucks Corporation (NASDAQ: SBUX)
US$24.72 billion
US$22.39 billion
10.41 US$3.55 billion
US$4.52 billion
-21.46
Delta Air Lines ( NYSE: DAL)
US$44.44 billion
US$41.24 billion
7.76 US$3.94 billion
US$3.58 billion
10.06
Southwest Airlines (NYSE: LUV)
US$21.97 billion
US$21.17 billion
3.78 US$2.47 billion
US$3.49 billion
-29.23
Carnival Corporation & Plc (NYSE: CCL)
US$18.88 billion
US$17.51 billion
7.82 US$3.15 billion
US$2.61 billion
20.67
Total US$194.66 billion
US$170.84 billion
13.94 US$29.65 billion
US$28.51 billion
4.00
Source: Mergent Analysis
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Travel and LeisureCurrent Environment United States
billion in fiscal 2017 while total net profit totaled US$29.65 billion, up 4% from US$28.51 billion in fiscal 2017.
Marriott International (NASDAQ: MAR) was the top performer in terms of revenue. The company managed to significantly increase its revenue by 304.68% from US$5.13 billion to US$20.76 billion due to increases in the number of rooms from acquisitions. McDonald’s (NYSE: MCD) had the largest fall in revenue, recording a decline of 7.84% from US$22.82 billion to US$21.03 billion due to restructuring efforts. In terms of net income, Booking Holdings (NASDAQ: BKNG) recorded the largest rise of 70.94% from US$2.34 billion to US$4 billion due to bookings growth. Hilton Worldwide
(NYSE: HLT) had the largest fall in net income with a fall of 39.37% from US$1.26 billion to US$764 million.
Mergers, Acquisitions and Alliances
Travel and leisure mergers and acquisition (M&A) activity increased as the industry became more competitive, with companies increasingly willing to seek suitable companies with which to form strategic alliances and partnerships. Based on the disclosed figures below, the largest acquisition deal was Blackstone REIT Inc’s acquisition of Bellagio Hotel & Casino for US$4.25 billion.
Table 4: Notable Mergers and Acquisitions in the US
Announcement Date
Acquirer Target Deal Value Deal Status Form of the Transaction
Deal Purpose Country
October 18, 2019
Fore Gold Partners Llc, a privately-held lessor and acquirer of gold clubs
Portmarnock Hotel & Golf Links, a privately-held golf course operator
US$3 million
Completed Acquisition of Assets
Boost market presence and expand market
US- US
October 18, 2019
Wellington Equine Estates Llc, a privately-held equine farming company
Palm Beach Polo Golf and Country Club, a privately-held golf course operator
US$16 million
Completed Acquisition of Assets
Boost market presence and expand market
US- US
October 15, 2019
Privately-owned real estate company Blackstone REIT Inc, a subsidiary of Blackstone Group Inc (NYSE: BX), a private equity company
Privately-owned hotel company Bellagio Hotel & Casino, a subsidiary of MGM Resorts International (NYSE: MGM), a hotel company
US$4.25 billion
Pending Acquisition of Assets
Boost market presence and expand market
US- US
October 10, 2019
Real estate investment trust, Service Properties Trust (NASDAQ: SVC)
Kimpton Hotel Palomar, Chicago, a privately-held hotel company
US$55 million
Completed Acquisition of Assets
Boost market presence and expand market
US- US
October 10, 2019
2925 Indian Creek Dr Llc, a privately-held lessor of real estate property
Alden Hotel, Miami Beach, Florida, a privately-held hotel company
US$21.30 million
Completed Acquisition of Assets
Boost market presence and expand market
US- US
Source: Mergent Analysis and Refinitiv
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Travel and Leisure
Tourism spending in Canada in second quarter 2019
amounted to C$24.30 billion (US$17.52 billion), up
2.19% from C$23.78 billion (US$17.15 billion) from
second quarter 2018. The industry remains committed
to market diversification. Significant progress has been
made through government initiatives, investment in new
open markets, improved visa facilitation and air access
agreements with other countries.
Sector Performance
From September 9, 2019, to March 9, 2020, ten out of
ten major Canadian travel and leisure stocks tracked by
Mergent experienced share prices decreases. The prices
of the stocks fell by an average of 22.77% over the period
due to the slump in the travel and leisure industry over
Sector Overview
Travel and leisure sector proving to be an essential pillar of the Canadian economy. Canada’s inbound travel and leisure sector was bolstered by growth in tourist arrivals from the emerging middle classes in Asia and Latin America, which were previously unable to or could not afford to travel abroad. Even though foreign visitors are pouring into the country, Canadians stuck close to home throughout 2019, due to a weaker local currency. The sector is over-reliant on domestic travel as more than 80% of its revenue derived from Canadians traveling within Canada.
Current Environment Canada
Table 5: Selected Companies’ Share Price Movements in the Six Months from September 9, 2019 to March 9, 2020
Travel and Leisure Companies Share Price on
Rise/Fall September 9, 2019 March 9, 2020
TWC Enterprises (TSX: TWC) C$13.13 (US$9.47) C$12.50 (US$9.01) -4.80%
Transat AT (TSX: TRZ) C$15.12 (US$10.90) C$13.05 (US$9.41) -13.69%
Pizza Pizza Royalty (TSX: PZA) C$10.12 (US$7.30) C$8.52 (US$6.14) -15.81%
Canlan Ice Sports (TSX: ICE) C$4.88 (US$3.52) C$3.94 (US$2.84) -19.26%
A&W Revenue Royalties Income Fund (TSX: AW_u) C$40.14 (US$28.94) C$31.63 (US$22.81) -21.20%
The Keg Royalties Income Fund (TSX: KEG_u) C$16.38 (US$11.81) C$12.41 (US$8.95) -24.24%
MTY Food Group (TSX: MTY) C$64.00 (US$46.15) C$47.93 (US$34.56) -25.11%
Restaurant Brands International (TSX: QSR) C$98.59 (US$71.09) C$71.42 (US$51.50) -27.56%
Boston Pizza Royalties Income Fund (TSX: BPF_u) C$17.33 (US$12.50) C$11.67 (US$8.41) -32.66%
Freshii (TSX: FRII) C$3.09 (US$2.23) C$1.75 (US$1.26) -43.37%
Average Rise/Fall -22.77% Source: Mergent Analysis
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Travel and LeisureCurrent Environment Canada
the COVID-19 virus outbreak. Freshii (TSX: FRII) shares
had the worst performance among the top travel and
leisure companies, with a price decline of 43.37%, from
C$3.09 (US$2.23) to C$1.75 (US$1.26).
Leading Companies
Top travel and leisure companies — analyzed by Mergent
based on their market capitalization — continued to
progress in fiscal 2018. Revenues of the mentioned
conglomerates were CS$9.55 billion (US$6.89 billion),
with Great Canadian Gaming being the top performer.
The company managed to significantly increase its
revenue by 98.60% due to the acquisition and expansion
of new facilities. TWC Enterprises (TSX: TWC) had the
largest fall in revenue, recording a decline of 26.97% due
to a fall in gold club memberships.
In fiscal 2018, all top companies tracked managed to
record a total net income of C$1.06 billion (US$764.29
million), up 41.37% from CS$749.78 million (US$540.62
million). TWC Enterprises, based on Mergent analysis,
was the top gainer, where its net income came at
C$223.29 million (US$161 million), up 10,845.59%
from C$2.04 million (US$1.47 million) due to gains from
discontinued operations. Boston Pizza Royalties Income
Fund (TSX: BPF_u) was the worst performing company,
where the net income dipped 67.88% to C$8.67 million
(US$6.25 million).
Table 6: Financials of Leading Travel and Leisure Companies for the Fiscal 2018
Travel and Leisure Companies
Revenues % Change
Net Income % Change
2018 2017 2018 2017
Great Canadian Gaming (TSX: GC)
C$1.22 billion (US$879.66 million)
C$614.30 million (US$442.93 million)
98.60 C$151.20 million (US$109.02 million)
C$84.30 million (US$60.78 million)
79.36
Restaurant Brands International (TSX: QSR)
US$5.36 billion US$4.58 billion 17.03 US$612 million US$648 million -5.56
Pollard Banknote (TSX: PBL)
C$331.87 million (US$239.29 million)
C$285.65 million (US$205.96 million)
16.18 C$14.85 million (US$10.71 million)
C$16.78 million (US$12.10 million)
-11.50
TWC Enterprises (TSX: TWC)
C$165.94 million (US$119.65 million)
C$227.22 million (US$163.83 million)
-26.97 C$223.29 million (US$161.36 million)
C$2.04 million (US$1.47 million)
10,845.59
A&W Revenue Royalties Income Fund (TSX: AWU_u)
C$40.89 million (US$29.48 million)
C$35.67 million (US$25.72 million)
14.63 C$23.40 million (US$16.87 million)
C$21.96 million (US$15.83 million)
6.56
Pizza Pizza Royalty (TSX: PZA)
C$35.41 million (US$25.53 million)
C$35.61 million (US$25.68 million)
-0.56 C$26.89 million (US$19.39 million)
C$27.05 million (US$19.50 million)
-0.59
The Keg Royalties Income Fund (TSX: KEG_u)
C$29.66 million (US$21.39 million)
C$28.58 million (US$20.61 million)
3.78 C$29.22 million (US$21.07 million)
C$17.06 million (US$12.30 million)
71.27
Boston Pizza Royalties Income Fund (TSX: BPF_u)
C$45.61 million (US$32.89 million)
C$44.68 million (US$32.22 million)
2.08 C$8.67 million (US$6.25 million)
C$26.99 million (US$19.46 million)
-67.88
MTY Food Group (TSX: MTY)
C$353.30 million (US$254.74 million)
C$276.08 million (US$199.06 million)
27.97 C$98.58 million (US$71.08 million)
C$49.51 million (US$35.70 million)
99.11
Gamehost (TSX: GH) C$70.40 million (US$50.76 million)
C$68.20 million (US$49.17 million)
3.23 C$17.00 million (US$12.26 million)
C$16.70 million (US$12.04 million)
1.80%
Sportscene Group (TSX: SPSa)
C$103.99 million (US$74.98 million)
C$95.09 million (US$68.56 million)
9.36 C$3.07 million (US$2.21 million)
C$1.52 million (US$1.10 million)
101.97
Total C$9.55 billion (US$6.89 billion)
C$7.82 billion (US$5.64 billion)
22.12 C$1.06 billion (US$764.29 million)
C$749.78 million (US$540.62 million)
41.37
Source: Mergent Analysis
8Mergent by FTSE Russell
Travel and LeisureCurrent Environment Canada
Mergers, Acquisitions and Alliances
As the US travel and leisure industry became more
competitive, the number of mergers, acquisitions
and alliances increased. Travel and leisure companies
were eager to find suitable partners to form strategic
alliances. Based on the disclosed figures below, the
largest acquisition deal was VCM Ltd, a privately-held
intermediating company’s acquisition of American Hotel
Income Properties REIT LP (TSX: HOT.UN) for US$216
million.
Table 7: Notable Mergers and Acquisitions
Announcement Date
Acquirer Target Deal Value
Deal Status Form of the Transaction
Deal Purpose Country
October 16, 2019
Sandman Hotel Group, a privately-held hotel operator.
Portmarnock Hotel & Golf Links, a privately- held golf resort company
US$55 million
Completed Acquisition of Assets
Boost market presence and expand market
Canada- Ireland
August 28, 2019
Investment company DLC Holdings Corp (TSXV: DLC.V)
Blacktail Mountain Ski Area, a privately-held skiing facility operator
US$4 million
Pending Acquisition of Assets
Boost market presence and expand market
Canada- US
July 30, 2019
VCM Ltd, a privately-held intermediating company
Real estate Investment trust American Hotel Income Properties REIT LP (TSX: HOT.UN)
US$216 million
Pending Acquisition of Assets
Boost market presence and expand market
Canada- Canada
July 17, 2019
Investment company Planet Ventures Inc (TSXV: PXI)
First Eleven Ltd, a privately-held amusement arcade operator
US$9 million
Pending Acquisition of Assets
Boost market presence and expand market
Canada- UK
June 21, 2019
Asset management company Brookfields Asset Management (TSX: BAM.A)
Mayfair Hotel & Spa, a privately- held hotel operator
US$40 million
Completed Acquisition of Assets
Boost market presence and expand market
Canada- US
Source: Mergent Analysis and Refinitiv
9Mergent by FTSE Russell
Travel and Leisure
The travel industry contributed 2.90% of total GDP and directly generated about US$170.90 billion in taxes for local, state and federal governments in 2018, according to the US Travel Association. Direct spending by resident and international travelers amounted to US$323.30 billion while leisure travel spending contributed US$117.40 billion in taxes.
The US had 79.62 million international visitors in 2018, up 2.76% from 76.94 million in 2017, according to the National Travel and Tourism Office (NTTO). It also noted that international visitors spent US$170.30 billion at US destinations in the first eight months of 2019, 0.86% down from US$171.78 billion a year earlier.
Industry Size and Value
The travel and leisure sector has long been an important driver and a bellwether of the health of the US economy. It is among the largest service industries, comprising several interrelated businesses such as lodging properties, airlines, casinos, restaurants, cruise lines, car rental firms, travel agents and tour operators, among others.
Industry Profile United States
Chart 8: Americans Overseas Departures by Market Share
Source: National Travel and Tourism Office (NTTO)
17.00%
9.80%
6.70%
2.50% 3.70%
0.90%
2.70%
0.50%
19.10%
9.40%
6.70%
2.30% 3.50%
0.90%
2.60%
0.50%
0.00%
5.00%
10.00%
15.00%
20.00%
25.00%
Europe Carribean Asia South America
Central America
Oceania Middle East
Africa
2017 2018
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Travel and LeisureIndustry Profile United States
The number of Americans visiting foreign countries rose to 93.04 million in 2018, up by 6.09% from 87.70 million in 2017, thanks to a strong US dollar making overseas travel cheaper. Spending by American travelers totaled US$186.51 billion, 7.34% up from US$173.76 billion in 2017, NTTO reported. This included US$144.46 billion in travel for all purposes including education and US$42.04 billion in passenger fares.
Employment
The sector generates more than US$1 trillion in economic output annually and is one of the country’s largest employers, providing jobs in transportation, hotels, restaurants, retail, entertainment and many other segments. The Bureau of Labor Statistics reported that it supported 16.72 million American jobs in
September 2019. The industry is also a major employer of younger workers, those without college degrees and those hurt by the financial crisis, with one out of every 18 Americans working, either directly or indirectly, in a travel or tourism- related industry.
Market Capitalization
The market cap of leading US travel and leisure companies tracked by Mergent totaled US$397.90 billion on March 9, 2020. McDonald’s had the largest share, 37.26%, followed by Booking Holdings (NASDAQ: BKNG), 16.64%; Las Vegas Sands, 10.53%; Marriot, 9.02%; Yum! Brands, 6.76%; Hilton (NYSE: HLT), 6.31%; Chipotle Mexican Grill Inc (NYSE: CMG), 5.05%; and Expedia Inc (NASDAQ: EXPE) with 3.23%.
Table 9: Travel and Leisure Employment (Seasonally Adjusted) (In thousands of employees)
Year Jan Feb Mar Apr May Jun Jul Aug Sept Oct Nov Dec 2017 15,884 15,920 15,939 16,010 16,029 16,061 16,118 16,123 16,043 16,145 16,163 16,195 2018 16,208 16,233 16,244 16,262 16,300 16,343 16,378 16,395 16,371 16,450 16,489 16,554 2019 16,643 16,643 16,678 16,687 16,699 16,703 16,690 16,699 16,720 n/a n/a n/a
Source: Bureau of Labor Statistics
Table 10: Market Capitalization of Leading Companies on March 9, 2020 (In billions of US$) Company Market Capitalization Market Share McDonald’s Corp (NYSE: MCD) US$148.24 37.26%
Booking Holdings (NASDAQ: BKNG) US$66.20 16.64%
Las Vegas Sands Corp (NYSE: LVS) US$41.90 10.53%
Marriott International Inc (NYSE: MAR) US$35.88 9.02%
Yum! Brands Inc (NYSE: YUM) US$26.89 6.76%
Hilton Worldwide Holdings, Inc (NYSE: HLT) US$25.10 6.31%
Chipotle Mexican Grill Inc (NYSE: CMG) US$20.08 5.05%
Expedia Inc (NASDAQ: EXPE) US$12.86 3.23%
Darden Restaurants Inc (NYSE: DRI) US$10.71 2.69%
MGM Resorts International (NYSE: MGM) US$10.04 2.52% Source: Mergent Analysis
11Mergent by FTSE Russell
Travel and Leisure
Canada’s tourism spending totaled C$24.30 billion (US$17.52 billion) in second quarter 2019, 3.27% up from C$23.53 billion (US$16.97 billion) in 2018, thanks to high tourism activities. Domestic travel spending generated C$19.10 billion (US$13.77 billion) in second quarter 2019, 0.10% up from C$19.08 billion (US$13.76 billion) a year earlier,
driven by rises in accommodation and food and beverage services. Expenditures by international visitors in second quarter 2019 increased by 2.40% to C$5.25 billion (US$3.79 billion) from C$5.13 billion (US$3.70 billion) a year earlier due to rises in transportation
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