EXHIBIT 20
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WENDY WATKINS: (301) 380-7903
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HTTP://WWW.HMSCORP.COM
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HOST MARRIOTT SERVICES ANNOUNCES IMPACT OF
AIRLINE STRIKE AND ASIAN SLOWDOWN ON EARNINGS
COMPANY EARNINGS TO FALL SHORT OF EXPECTATIONS
BETHESDA, MARYLAND, SEPTEMBER 16, 1998--Host Marriott Services
(NYSE:HMS) announced today that it will fall short of third quarter analysts'
expectations primarily due to the negative impact of the Northwest Airlines
pilots strike, along with the negative impact of the Asian slowdown on its duty
free business. The company estimates earnings per share of 50 to 51 cents for
the quarter. The third quarter earnings estimate is a "forward-looking
statement" within the meaning of The Private Securities Litigation Reform Act of
1995. This is a slight decline from the 52 cents per share the company recorded
in 1997. The company will be releasing its third quarter earnings the week of
October 5.
The company's third quarter concluded on September 11 and early
estimates indicate that approximately 3 cents in earnings were lost due to the
impact of the Northwest Airlines strike. The impact was most evident in the
company's hub operations for Northwest Airlines in Minneapolis/St. Paul, Detroit
and Memphis. In response to the strike, the company temporarily closed more than
half of its units at these locations and laid off more than 800 workers. The
company is pleased the strike has ended and is hopeful that Northwest Airlines
operations will resume quickly.
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HOST MARRIOTT SERVICES ANNOUNCES IMPACT OF
AIRLINE STRIKE AND ASIAN SLOWDOWN ON EARNINGS
Although the company sees many long term opportunities in Asia, with
the recent reduction in Asian travel, the company has experienced a negative
impact on its earnings mostly from its duty free shops located in several key
gateway airports in the United States. Since the effect of the strike will
linger into the fourth quarter and the Asian slowdown continues, the company
estimates full year earnings per share of 59 to 60 cents compared to 57 cents in
1997. The fiscal year 1998 earnings estimate is a "forward-looking statement"
within the meaning of The Private Securities Litigation Reform Act of 1995.
"We expect the impact of the Northwest Airlines strike to be short
term," said Bill McCarten, President and Chief Executive Officer, Host Marriott
Services. "In spite of the impact of the strike and the Asian slowdown, our
performance continues to be strong," Mr. McCarten added. "We are continuing our
successful entry into the $2.5 billion shopping mall food and beverage market
and expect as many as three new contracts to be signed within the next month.
Yesterday we announced another international airport award at the Shenzhen
International Airport in China, extending Host Marriott Services' unique
expertise to a seventh country. Shenzhen International Airport is the fifth
largest in the People's Republic of China. With our international and mall
progress, we remain committed to our long term goals of $2 billion in revenues
by 2001 and average annual earnings growth of 20% for 1999 and beyond."
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HOST MARRIOTT SERVICES ANNOUNCES IMPACT OF
AIRLINE STRIKE AND ASIAN SLOWDOWN ON EARNINGS
Host Marriott Services, with its worldwide headquarters in Bethesda, Maryland,
is the leading food, beverage and retail service company at 200 travel and
entertainment venues, with over 24,000 employees in seven countries around the
globe. The company is best known for its custom solutions business approach that
combines internationally known brands with regional favorites in airports,
travel plazas, shopping malls and entertainment attractions.
THIS PRESS RELEASE CONTAINS "FORWARD-LOOKING STATEMENTS" WITHIN THE MEANING OF
FEDERAL SECURITIES LAWS, INCLUDING, BUT NOT LIMITED TO, STATEMENTS CONCERNING
THE COMPANY'S OUTLOOK FOR 1998 AND BEYOND; THE GROWTH IN TOTAL REVENUE FOR 1998
AND SUBSEQUENT YEARS; BUSINESS STRATEGIES AND ANTICIPATED RESULTS AND SIMILAR
STATEMENTS CONCERNING EVENTS AND EXPECTATIONS THAT ARE NOT HISTORICAL FACTS.
THESE FORWARD-LOOKING STATEMENTS ARE SUBJECT TO NUMEROUS RISKS AND
UNCERTAINTIES, INCLUDING THE EFFECTS OF SEASONALITY, AIRLINE AND TOLLROAD
INDUSTRY FUNDAMENTALS, GENERAL ECONOMIC CONDITIONS (INCLUDING THE CURRENT
ECONOMIC DOWNTURN IN ASIA), THE POTENTIAL ADVERSE IMPACT OF THE YEAR 2000 ISSUE
ON OPERATIONS, COMPETITIVE FORCES WITHIN THE FOOD, BEVERAGE AND RETAIL
CONCESSIONS INDUSTRIES, AND THE AVAILABILITY OF CASH FLOW TO FUND FUTURE CAPITAL
EXPENDITURES. FORWARD-LOOKING STATEMENTS ARE INHERENTLY UNCERTAIN, AND INVESTORS
MUST RECOGNIZE THAT ACTUAL RESULTS COULD DIFFER MATERIALLY FROM THOSE EXPRESSED
OR IMPLIED BY THE STATEMENTS.
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