Marriott Vacations Worldwide Reports Fourth Quarter and Full Year 2023 Financial Results

Feb 21, 2024

ORLANDO, Fla.--(BUSINESS WIRE)--Feb. 21, 2024-- Marriott Vacations Worldwide Corporation (NYSE: VAC) (“MVW” or the “Company”) reported financial results for the fourth quarter and full year 2023 and provided guidance for full year 2024.

“After a challenging year, we ended the year on a very positive note, growing contract sales by 4% in the fourth quarter on a year-over-year basis with VPG in-line with the prior year, after adjusting for the estimated impact of the Maui wildfires,” said John Geller, President and Chief Executive Officer. “The transition to Abound by Marriott Vacations is behind us. Moving forward, we continue to look for ways to leverage technology to grow our revenues while driving efficiencies and cost savings across the organization.”

Fourth Quarter 2023 Highlights

  • Consolidated Vacation Ownership contract sales declined 2% year-over-year to $447 million driven by 2% lower volume per guest (“VPG”). The Company estimates that excluding the impact of the Maui wildfires, contract sales would have grown 4%, tours would have increased 4% and VPG would have been unchanged compared to the prior year.
  • Net income attributable to common stockholders was $35 million and fully diluted earnings per share was $0.93.
  • Adjusted net income attributable to common stockholders was $75 million and adjusted fully diluted earnings per share was $1.88.
  • Adjusted EBITDA was $186 million.
  • The Company repurchased 431,000 shares of its common stock for $38 million during the quarter and increased its quarterly dividend to $0.76 per share, which was paid in January. For the year, the Company repurchased 6% of its shares outstanding for $286 million and paid $106 million in dividends.

Fourth Quarter 2023 Results
On August 8, 2023, a wildfire devastated the area of West Maui. While the Company operates four vacation ownership resorts and sales centers in the area, it did not sustain any physical damage to these resorts and sales centers. However, the Company estimates the Maui wildfires negatively impacted its fourth quarter contract sales by approximately $25 million, Net income attributable to common stockholders by $17 million and Adjusted EBITDA by $24 million.

In the third quarter of 2022, the Company aligned its contract terms for the sale of its Marriott-, Westin-, and Sheraton-branded vacation ownership products, resulting in the acceleration of revenue from the sale of Marriott-branded vacation ownership interests. In addition, the Company aligned its reserve methodology for vacation ownership notes receivable for these brands, resulting in a decrease in the reserve for the acquired notes offset by an increase in the reserve for the originated notes. Together, these changes are referred to as the “Alignment.”

The tables below illustrate the comparison of the reported results from the fourth quarter of 2023, as well as adjusted results that reflect the estimated impact of the Maui fires, to the results from the fourth quarter of 2022, including the impact of the Alignment on the Company’s reported results for that time period. In the tables below “*” denotes non-GAAP financial measures. Please see “Non-GAAP Financial Measures” for additional information about our reasons for providing these alternative financial measures and limitations on their use.

Consolidated

 

 

Three Months Ended

 

 

December 31, 2023

 

December 31, 2022

($ in millions)

 

As
Reported

 

Estimated
Impact of
Maui Fires

 

As
Adjusted*

 

As
Reported

 

Impact of
Alignment

 

As
Adjusted*

Net income attributable to common stockholders

 

$

35

 

$

17

 

$

52

 

$

88

 

$

(5

)

 

$

83

 

Adjusted net income attributable to common stockholders*

 

$

75

 

$

17

 

$

92

 

$

115

 

$

(5

)

 

$

110

 

Adjusted EBITDA*

 

$

186

 

$

24

 

$

210

 

$

239

 

$

(7

)

 

$

232

 

Vacation Ownership

Selected Items

 

Three Months Ended

 

December 31, 2023

 

December 31, 2022

($ in millions, except VPG)

As
Reported

 

Estimated
Impact of
Maui Fires

 

As
Adjusted*

 

As
Reported

 

Impact of
Alignment

 

As
Adjusted*

Consolidated contract sales

$

447

 

 

$

25

 

$

472

 

 

$

454

 

 

$

 

 

$

454

 

VPG

$

4,002

 

 

$

88

 

$

4,090

 

 

$

4,088

 

 

$

 

 

$

4,088

 

Tours

 

105,580

 

 

 

4,028

 

 

109,608

 

 

 

105,231

 

 

 

 

 

 

105,231

 

Sale of vacation ownership products

$

375

 

 

$

24

 

$

399

 

 

$

439

 

 

$

(12

)

 

$

427

 

Development profit

$

120

 

 

$

18

 

$

138

 

 

$

162

 

 

$

(7

)

 

$

155

 

Management and exchange profit

$

75

 

 

$

2

 

$

77

 

 

$

70

 

 

$

 

 

$

70

 

Rental profit

$

15

 

 

$

2

 

$

17

 

 

$

15

 

 

$

 

 

$

15

 

Financing profit

$

51

 

 

$

 

$

51

 

 

$

50

 

 

$

 

 

$

50

 

Other

$

(3

)

 

$

3

 

$

 

 

$

1

 

 

$

 

 

$

1

 

Segment financial results attributable to common stockholders

$

199

 

 

$

25

 

$

224

 

 

$

241

 

 

$

(5

)

 

$

236

 

Segment margin

 

27.3%

 

 

 

 

 

29.7%

 

 

 

31.9%

 

 

 

 

 

31.7%

 

Segment Adjusted EBITDA*

$

236

 

 

$

25

 

$

261

 

 

$

261

 

 

$

(7

)

 

$

254

 

Segment Adjusted EBITDA margin*

 

32.5%

 

 

 

 

 

34.7%

 

 

 

34.6%

 

 

 

 

 

34.2%

 

Revenues excluding cost reimbursements decreased 3% in the fourth quarter of 2023 compared to the prior year. The decline was driven by a 2% year-over-year reduction in consolidated contract sales resulting from the Maui wildfires, as well as a $24 million prior year reportability benefit. Adjusted for the estimated $25 million impact of the Maui wildfires, consolidated contract sales would have increased 4% year-over-year.

Segment financial results attributable to common stockholders declined $42 million to $199 million in the fourth quarter of 2023 and Segment Adjusted EBITDA declined $25 million to $236 million. Adjusting for the $25 million estimated impact from the Maui wildfires in the current year and $7 million Alignment benefit in the prior year, Segment Adjusted EBITDA would have increased 3% to $261 million.

Exchange & Third-Party Management

Selected Items

 

Three Months Ended

 

December 31, 2023

 

December 31, 2022

($ in millions)

As
Reported

 

Estimated
Impact of
Maui Fires

 

As
Adjusted*

 

As
Reported

 

Impact of
Alignment

 

As
Adjusted*

Management and exchange profit

$

22

 

 

$

(1

)

 

$

21

 

 

$

22

 

 

$

 

$

22

 

Segment financial results attributable to common stockholders

$

18

 

 

$

(1

)

 

$

17

 

 

$

24

 

 

$

 

$

24

 

Segment margin

 

31.1%

 

 

 

 

 

28.3%

 

 

 

41.3%

 

 

 

 

 

41.3%

 

Segment Adjusted EBITDA*

$

31

 

 

$

(1

)

 

$

30

 

 

$

31

 

 

$

 

$

31

 

Segment Adjusted EBITDA margin*

 

52.2%

 

 

 

 

 

49.3%

 

 

 

54.9%

 

 

 

 

 

54.9%

 

Revenues excluding cost reimbursements decreased 2% in the fourth quarter of 2023 compared to the prior year driven by lower member transactions. Interval International ended the year with 1.6 million active members, in-line with the prior year, and Average revenue per member increased 2% year-over-year in the fourth quarter.

Segment financial results attributable to common stockholders were $18 million in the fourth quarter of 2023, Segment margin was 31% and Segment Adjusted EBITDA was $31 million. Adjusted for the estimated impact from the Maui wildfires, Segment Adjusted EBITDA would have decreased $1 million to $30 million.

Corporate and Other
General and administrative costs increased $22 million in the fourth quarter of 2023 compared to the prior year primarily due to higher IT spending to drive our digital and data initiatives.

Balance Sheet and Liquidity
The Company ended the year with $929 million in liquidity, including $248 million of cash and cash equivalents, $60 million of gross notes receivable that were eligible for securitization, and $621 million of available capacity under its revolving corporate credit facility.

At the end of 2023, the Company had $3.0 billion of corporate debt and $2.1 billion of non-recourse debt related to its securitized notes receivable.

Full Year 2024 Outlook
The Company is providing guidance for the full year 2024 as reflected in the chart below. The Financial Schedules that follow reconcile the following full year 2024 expected GAAP results for the Company to the non-GAAP financial measures set forth below.

In the table below “*” denotes non-GAAP financial measures. Please see “Non-GAAP Financial Measures” for additional information about our reasons for providing these alternative financial measures and limitations on their use.

(in millions, except per share amounts)

2024 Guidance

 

Contract sales

$1,880

to

$1,930

 

Net income attributable to common stockholders

$285

to

$320

 

Earnings per share - diluted

$7.17

to

$8.00

 

Net cash, cash equivalents, and restricted cash provided by operating activities

$265

to

$295

 

Adjusted EBITDA*

$760

to

$800

 

Adjusted earnings per share - diluted*

$7.65

to

$8.35

 

Adjusted free cash flow*

$400

to

$450

 

Non-GAAP Financial Information
Non-GAAP financial measures are reconciled and adjustments are shown and described in further detail in the Financial Schedules that follow. Please see “Non-GAAP Financial Measures” for additional information about our reasons for providing these alternative financial measures and limitations on their use. In addition to the foregoing non-GAAP financial measures, we present certain key metrics as performance measures which are further described in our most recent Annual Report on Form 10-K, and which may be updated in our periodic filings with the U.S. Securities and Exchange Commission.

Fourth Quarter 2023 Financial Results Conference Call
The Company will hold a conference call on February 22, 2024 at 8:30 a.m. ET to discuss these financial results and provide an update on business conditions. Participants may access the call by dialing (877) 407-8289 or (201) 689-8341 for international callers. A live webcast of the call will also be available in the Investor Relations section of the Company's website at ir.mvwc.com. An audio replay of the conference call will be available for 30 days on the Company’s website.

About Marriott Vacations Worldwide Corporation
Marriott Vacations Worldwide Corporation is a leading global vacation company that offers vacation ownership, exchange, rental and resort and property management, along with related businesses, products, and services. The Company has approximately 120 vacation ownership resorts and approximately 700,000 owner families in a diverse portfolio that includes some of the most iconic vacation ownership brands. The Company also operates an exchange network and membership programs comprised of more than 3,200 affiliated resorts in over 90 countries and territories, and provides management services to other resorts and lodging properties. As a leader and innovator in the vacation industry, the Company upholds the highest standards of excellence in serving its customers, investors and associates while maintaining exclusive, long-term relationships with Marriott International, Inc. and an affiliate of Hyatt Hotels Corporation for the development, sales and marketing of vacation ownership products and services. For more information, please visit www.marriottvacationsworldwide.com.

Note on forward-looking statements
This press release and accompanying schedules contain “forward-looking statements” within the meaning of federal securities laws, including statements about leveraging technology to enhance core operations and other benefits to the organization and full year 2024 outlook for contract sales, results of operations and cash flows. Forward-looking statements include all statements that are not historical facts and can be identified by the use of forward-looking terminology such as the words “believe,” “expect,” “plan,” “intend,” “anticipate,” “estimate,” “predict,” “potential,” “continue,” “may,” “might,” “should,” “could” or the negative of these terms or similar expressions. The Company cautions you that these statements are not guarantees of future performance and are subject to numerous and evolving risks and uncertainties that we may not be able to predict or assess, such as: a future health crisis and responses to a health crisis, including possible quarantines or other government imposed travel or health-related restrictions and the effects of a health crisis, including the short and longer-term impact on consumer confidence and demand for travel and the pace of recovery following a health crisis; variations in demand for vacation ownership and exchange products and services; worker absenteeism; price inflation; difficulties associated with implementing new or maintaining existing technology; changes in privacy laws; the impact of a future banking crisis; impacts from natural or man-made disasters and wildfires, including the Maui wildfires; global supply chain disruptions; volatility in the international and national economy and credit markets, including as a result of the ongoing conflicts between Russia and Ukraine, Israel and Gaza, and elsewhere in the world and related sanctions and other measures; our ability to attract and retain our global workforce; competitive conditions; the availability of capital to finance growth; the impact of changes in interest rates; the effects of steps we have taken and may continue to take to reduce operating costs; political or social strife; and other matters referred to under the heading “Risk Factors” in our most recent Annual Report on Form 10-K, and which may be updated in our future periodic filings with the U.S. Securities and Exchange Commission. All forward-looking statements in this press release are made as of the date of this press release and the Company undertakes no obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future events, or otherwise, except as required by law. There may be other risks and uncertainties that we cannot predict at this time or that we currently do not expect will have a material adverse effect on our financial position, results of operations or cash flows. Any such risks could cause our results to differ materially from those we express in forward-looking statements.

Financial Schedules Follow

MARRIOTT VACATIONS WORLDWIDE CORPORATION

FINANCIAL SCHEDULES

QUARTER 4, 2023

 
 

TABLE OF CONTENTS

   

Summary Financial Information

A-1

Adjusted EBITDA by Segment

A-2

Consolidated Statements of Income

A-3

to

A-4

Revenues and Profit by Segment

A-5

to

A-6

Consolidated Contract Sales to Adjusted Development Profit

A-7

to

A-8

Adjusted Net Income Attributable to Common Stockholders and Adjusted Earnings Per Share - Diluted

A-9

Adjusted EBITDA

A-10

Segment Adjusted EBITDA

 

Vacation Ownership

A-11

Exchange & Third-Party Management

 

Balance Sheet Items and Summary Cash Flow

A-12

2024 Outlook

 

 

 

Adjusted Net Income Attributable to Common Stockholders, Adjusted Earnings Per Share - Diluted and Adjusted EBITDA

A-13

Adjusted Free Cash Flow

A-14

Quarterly Operating Metrics

A-15

Non-GAAP Financial Measures

A-16

to

A-17

A-1

 

MARRIOTT VACATIONS WORLDWIDE CORPORATION

(In millions, except VPG, tours, total active Interval International members, average revenue per member, and per share amounts)

(Unaudited)

SUMMARY FINANCIAL INFORMATION

     

 

       

 

Quarter Ended

 

Change %

 

Fiscal Year Ended

 

Change %

 

December
31, 2023

 

December
31, 2022

 

 

December
31, 2023

 

December
31, 2022

 

Key Measures

 

 

 

 

 

 

 

 

 

 

 

Total consolidated contract sales

$

447

 

$

454

 

(2%)

 

$

1,772

 

$

1,837

 

(4%)

VPG

$

4,002

 

$

4,088

 

(2%)

 

$

4,088

 

$

4,421

 

(8%)

Tours

 

105,580

 

 

105,231

 

0%

 

 

405,825

 

 

390,593

 

4%

Total active Interval International members (000's)(1)

 

1,564

 

 

1,566

 

0%

 

 

1,564

 

 

1,566

 

0%

Average revenue per Interval International member

$

36.16

 

$

35.60

 

2%

 

$

156.65

 

$

157.97

 

(1%)

 

 

 

 

 

 

 

 

 

 

 

 

GAAP Measures

 

 

 

 

 

 

 

 

 

 

 

Revenues

$

1,194

 

$

1,188

 

0%

 

$

4,727

 

$

4,656

 

2%

Income before income taxes and noncontrolling interests

$

64

 

$

145

 

(55%)

 

$

398

 

$

582

 

(31%)

Net income attributable to common stockholders

$

35

 

$

88

 

(60%)

 

$

254

 

$

391

 

(35%)

Diluted shares

 

42.5

 

 

43.0

 

(1%)

 

 

43.5

 

 

45.2

 

(4%)

Earnings per share - diluted

$

0.93

 

$

2.08

 

(55%)

 

$

6.28

 

$

8.77

 

(28%)

 

 

 

 

 

 

 

 

 

 

 

 

Non-GAAP Measures*

 

 

 

 

 

 

 

 

 

 

 

Adjusted EBITDA

$

186

 

$

239

 

(22%)

 

$

761

 

$

966

 

(21%)

Adjusted pretax income

$

105

 

$

169

 

(38%)

 

$

450

 

$

677

 

(34%)

Adjusted net income attributable to common stockholders

$

75

 

$

115

 

(35%)

 

$

322

 

$

458

 

(30%)

Adjusted earnings per share - diluted

$

1.88

 

$

2.74

 

(31%)

 

$

7.83

 

$

10.26

 

(24%)

 

 

 

 

 

 

 

 

 

 

 

 

(1) Includes members at the end of each period.

* Denotes non-GAAP financial measures. Please see “Non-GAAP Financial Measures” for additional information about our reasons for providing these alternative financial measures and limitations on their use.

 

 

 

 

 

 

 

 

 

 

 

 

A-2

 

MARRIOTT VACATIONS WORLDWIDE CORPORATION

ADJUSTED EBITDA BY SEGMENT

(In millions)

(Unaudited)

   

 

Three Months Ended

 

December 31,
2023

 

December 31, 2022

 

 

As
Reported

 

Impact of
Alignment

 

As
Adjusted*

 

 

 

 

Vacation Ownership

$

236

 

 

$

261

 

 

$

(7

)

 

$

254

 

Exchange & Third-Party Management

 

31

 

 

 

31

 

 

 

 

 

 

31

 

Segment Adjusted EBITDA*

 

267

 

 

 

292

 

 

 

(7

)

 

 

285

 

General and administrative

 

(84

)

 

 

(62

)

 

 

 

 

 

(62

)

Other

 

3

 

 

 

9

 

 

 

 

 

 

9

 

Adjusted EBITDA*

$

186

 

 

$

239

 

 

$

(7

)

 

$

232

 

 

Twelve Months Ended

 

December 31,
2023

 

December 31, 2022

 

 

As
Reported

 

Impact of
Alignment

 

As
Adjusted*

 

 

 

 

Vacation Ownership

$

883

 

 

$

1,033

 

 

$

(51

)

 

$

982

 

Exchange & Third-Party Management

 

130

 

 

 

148

 

 

 

 

 

 

148

 

Segment Adjusted EBITDA*

 

1,013

 

 

 

1,181

 

 

 

(51

)

 

 

1,130

 

General and administrative

 

(273

)

 

 

(249

)

 

 

 

 

 

(249

)

Other

 

21

 

 

 

34

 

 

 

 

 

 

34

 

Adjusted EBITDA*

$

761

 

 

$

966

 

 

$

(51

)

 

$

915

 

 

* Denotes non-GAAP financial measures. Please see “Non-GAAP Financial Measures” for additional information about our reasons for providing these alternative financial measures and limitations on their use.

 

A-3

 

MARRIOTT VACATIONS WORLDWIDE CORPORATION

CONSOLIDATED STATEMENTS OF INCOME

(In millions, except per share amounts)

   

 

Three Months Ended

 

December
31, 2023

 

December 31, 2022

 

 

As
Reported

 

Impact of
Alignment

 

As
Adjusted*

REVENUES

 

 

 

 

 

 

 

Sale of vacation ownership products

$

375

 

 

$

439

 

 

$

(12

)

 

$

427

 

Management and exchange

 

202

 

 

 

204

 

 

 

 

 

 

204

 

Rental

 

136

 

 

 

113

 

 

 

 

 

 

113

 

Financing

 

83

 

 

 

76

 

 

 

 

 

 

76

 

Cost reimbursements

 

398

 

 

 

356

 

 

 

 

 

 

356

 

TOTAL REVENUES

 

1,194

 

 

 

1,188

 

 

 

(12

)

 

 

1,176

 

EXPENSES

 

 

 

 

 

 

 

Cost of vacation ownership products

 

50

 

 

 

73

 

 

 

(5

)

 

 

68

 

Marketing and sales

 

205

 

 

 

204

 

 

 

 

 

 

204

 

Management and exchange

 

110

 

 

 

114

 

 

 

 

 

 

114

 

Rental

 

108

 

 

 

88

 

 

 

 

 

 

88

 

Financing

 

32

 

 

 

26

 

 

 

 

 

 

26

 

General and administrative

 

84

 

 

 

62

 

 

 

 

 

 

62

 

Depreciation and amortization

 

36

 

 

 

34

 

 

 

 

 

 

34

 

Litigation charges

 

6

 

 

 

4

 

 

 

 

 

 

4

 

Restructuring

 

6

 

 

 

 

 

 

 

 

 

 

Royalty fee

 

29

 

 

 

30

 

 

 

 

 

 

30

 

Impairment

 

28

 

 

 

1

 

 

 

 

 

 

1

 

Cost reimbursements

 

398

 

 

 

356

 

 

 

 

 

 

356

 

TOTAL EXPENSES

 

1,092

 

 

 

992

 

 

 

(5

)

 

 

987

 

Gains and other income, net

 

13

 

 

 

1

 

 

 

 

 

 

1

 

Interest expense, net

 

(39

)

 

 

(27

)

 

 

 

 

 

(27

)

Transaction and integration costs

 

(9

)

 

 

(26

)

 

 

 

 

 

(26

)

Other

 

(3

)

 

 

1

 

 

 

 

 

 

1

 

INCOME (LOSS) BEFORE INCOME TAXES AND NONCONTROLLING INTERESTS

 

64

 

 

 

145

 

 

 

(7

)

 

 

138

 

(Provision for) benefit from income taxes

 

(31

)

 

 

(57

)

 

 

2

 

 

 

(55

)

NET INCOME (LOSS)

 

33

 

 

 

88

 

 

 

(5

)

 

 

83

 

Net income attributable to noncontrolling interests

 

2

 

 

 

 

 

 

 

 

 

 

NET INCOME (LOSS) ATTRIBUTABLE TO COMMON STOCKHOLDERS

$

35

 

 

$

88

 

 

$

(5

)

 

$

83

 

 

 

 

 

 

 

 

 

EARNINGS (LOSS) PER SHARE ATTRIBUTABLE TO COMMON STOCKHOLDERS

 

 

 

 

 

 

 

Basic shares

 

35.6

 

 

 

38.2

 

 

 

 

 

 

38.2

 

Basic

$

0.98

 

 

$

2.30

 

 

$

(0.16

)

 

$

2.14

 

Diluted shares

 

42.5

 

 

 

43.0

 

 

 

 

 

 

43.0

 

Diluted

$

0.93

 

 

$

2.08

 

 

$

(0.14

)

 

$

1.94

 

 

 

 

 

 

 

 

 

* Denotes non-GAAP financial measures. Please see “Non-GAAP Financial Measures” for additional information about our reasons for providing these alternative financial measures and limitations on their use.

A-4

 

MARRIOTT VACATIONS WORLDWIDE CORPORATION

CONSOLIDATED STATEMENTS OF INCOME

(In millions, except per share amounts)

   

 

Twelve Months Ended

 

December
31, 2023

 

December 31, 2022

 

 

As
Reported

 

Impact of
Alignment

 

As
Adjusted*

REVENUES

 

 

 

 

 

 

 

Sale of vacation ownership products

$

1,460

 

 

$

1,618

 

 

$

(39

)

 

$

1,579

 

Management and exchange

 

813

 

 

 

827

 

 

 

 

 

 

827

 

Rental

 

571

 

 

 

551

 

 

 

 

 

 

551

 

Financing

 

322

 

 

 

293

 

 

 

 

 

 

293

 

Cost reimbursements

 

1,561

 

 

 

1,367

 

 

 

 

 

 

1,367

 

TOTAL REVENUES

 

4,727

 

 

 

4,656

 

 

 

(39

)

 

 

4,617

 

EXPENSES

 

 

 

 

 

 

 

Cost of vacation ownership products

 

224

 

 

 

289

 

 

 

(7

)

 

 

282

 

Marketing and sales

 

823

 

 

 

807

 

 

 

 

 

 

807

 

Management and exchange

 

442

 

 

 

444

 

 

 

 

 

 

444

 

Rental

 

452

 

 

 

382

 

 

 

 

 

 

382

 

Financing

 

113

 

 

 

75

 

 

 

19

 

 

 

94

 

General and administrative

 

273

 

 

 

249

 

 

 

 

 

 

249

 

Depreciation and amortization

 

135

 

 

 

132

 

 

 

 

 

 

132

 

Litigation charges

 

13

 

 

 

11

 

 

 

 

 

 

11

 

Restructuring

 

6

 

 

 

 

 

 

 

 

 

 

Royalty fee

 

117

 

 

 

114

 

 

 

 

 

 

114

 

Impairment

 

32

 

 

 

2

 

 

 

 

 

 

2

 

Cost reimbursements

 

1,561

 

 

 

1,367

 

 

 

 

 

 

1,367

 

TOTAL EXPENSES

 

4,191

 

 

 

3,872

 

 

 

12

 

 

 

3,884

 

Gains and other income, net

 

47

 

 

 

40

 

 

 

 

 

 

40

 

Interest expense, net

 

(145

)

 

 

(118

)

 

 

 

 

 

(118

)

Transaction and integration costs

 

(37

)

 

 

(125

)

 

 

 

 

 

(125

)

Other

 

(3

)

 

 

1

 

 

 

 

 

 

1

 

INCOME (LOSS) BEFORE INCOME TAXES AND NONCONTROLLING INTERESTS

 

398

 

 

 

582

 

 

 

(51

)

 

 

531

 

(Provision for) benefit from income taxes

 

(146

)

 

 

(191

)

 

 

13

 

 

 

(178

)

NET INCOME (LOSS)

 

252

 

 

 

391

 

 

 

(38

)

 

 

353

 

Net loss attributable to noncontrolling interests

 

2

 

 

 

 

 

 

 

 

 

 

NET INCOME (LOSS) ATTRIBUTABLE TO COMMON STOCKHOLDERS

$

254

 

 

$

391

 

 

$

(38

)

 

$

353

 

 

 

 

 

 

 

 

 

EARNINGS (LOSS) PER SHARE ATTRIBUTABLE TO COMMON STOCKHOLDERS

 

 

 

 

 

 

 

Basic shares

 

36.5

 

 

 

40.4

 

 

 

 

 

 

40.4

 

Basic

$

6.96

 

 

$

9.69

 

 

$

(0.93

)

 

$

8.76

 

Diluted shares

 

43.5

 

 

 

45.2

 

 

 

 

 

 

45.2

 

Diluted

$

6.28

 

 

$

8.77

 

 

$

(0.83

)

 

$

7.94

 

 

 

 

 

 

 

 

 

* Denotes non-GAAP financial measures. Please see “Non-GAAP Financial Measures” for additional information about our reasons for providing these alternative financial measures and limitations on their use.

A-5

 

MARRIOTT VACATIONS WORLDWIDE CORPORATION

REVENUES AND PROFIT BY SEGMENT

for the three months ended December 31, 2023

(In millions)

           

 

Reportable Segment

 

Corporate
and Other

 

Total

 

Vacation
Ownership

 

Exchange &
Third-Party
Management

 

 

REVENUES

 

 

 

 

 

 

 

Sales of vacation ownership products

$

375

 

 

$

 

 

$

 

 

$

375

 

Management and exchange(1)

 

 

 

 

 

 

 

Ancillary

 

59

 

 

 

2

 

 

 

 

 

 

61

 

Management fee

 

46

 

 

 

6

 

 

 

(1

)

 

 

51

 

Exchange and other services

 

38

 

 

 

41

 

 

 

11

 

 

 

90

 

Management and exchange

 

143

 

 

 

49

 

 

 

10

 

 

 

202

 

Rental

 

127

 

 

 

9

 

 

 

 

 

 

136

 

Financing

 

83

 

 

 

 

 

 

 

 

 

83

 

Cost reimbursements(1)

 

405

 

 

 

4

 

 

 

(11

)

 

 

398

 

TOTAL REVENUES

$

1,133

 

 

$

62

 

 

$

(1

)

 

$

1,194

 

 

 

 

 

 

 

 

 

PROFIT

 

 

 

 

 

 

 

Development

$

120

 

 

$

 

 

$

 

 

$

120

 

Management and exchange(1)

 

75

 

 

 

22

 

 

 

(5

)

 

 

92

 

Rental(1)

 

15

 

 

 

9

 

 

 

4

 

 

 

28

 

Financing

 

51

 

 

 

 

 

 

 

 

 

51

 

TOTAL PROFIT

 

261

 

 

 

31

 

 

 

(1

)

 

 

291

 

 

 

 

 

 

 

 

 

OTHER

 

 

 

 

 

 

 

General and administrative

 

 

 

 

 

 

 

(84

)

 

 

(84

)

Depreciation and amortization

 

(24

)

 

 

(8

)

 

 

(4

)

 

 

(36

)

Litigation charges

 

(4

)

 

 

(1

)

 

 

(1

)

 

 

(6

)

Restructuring

 

 

 

 

 

 

 

(6

)

 

 

(6

)

Royalty fee

 

(29

)

 

 

 

 

 

 

 

 

(29

)

Impairment

 

(8

)

 

 

(4

)

 

 

(16

)

 

 

(28

)

Gains and other income, net

 

6

 

 

 

 

 

 

7

 

 

 

13

 

Interest expense, net

 

 

 

 

 

 

 

(39

)

 

 

(39

)

Transaction and integration costs

 

 

 

 

 

 

 

(9

)

 

 

(9

)

Other

 

(3

)

 

 

 

 

 

 

 

 

(3

)

INCOME (LOSS) BEFORE INCOME TAXES AND NONCONTROLLING INTERESTS

 

199

 

 

 

18

 

 

 

(153

)

 

 

64

 

Provision for income taxes

 

 

 

 

 

 

 

(31

)

 

 

(31

)

NET INCOME (LOSS)

 

199

 

 

 

18

 

 

 

(184

)

 

 

33

 

Net income attributable to noncontrolling interests(1)

 

 

 

 

 

 

 

2

 

 

 

2

 

NET INCOME (LOSS) ATTRIBUTABLE TO COMMON STOCKHOLDERS

$

199

 

 

$

18

 

 

$

(182

)

 

$

35

 

SEGMENT MARGIN(2)

 

27%

 

 

 

31%

 

 

 

 

 

 

 

 

 

 

 

 

 

(1) Amounts included in Corporate and other represent the impact of the consolidation of certain owners’ associations under the relevant accounting guidance, and represent the portion attributable to individual or third-party vacation ownership interest owners.

(2) Segment margin represents the applicable segment’s net income or loss attributable to common stockholders divided by the applicable segment’s total revenues less cost reimbursement revenues.

A-6

 

MARRIOTT VACATIONS WORLDWIDE CORPORATION

REVENUES AND PROFIT BY SEGMENT

for the three months ended December 31, 2022

(In millions)

           

 

Reportable Segment

 

Corporate
and
Other

 

Total

 

Vacation Ownership

 

Exchange &
Third-Party
Management

 

 

As
Reported

 

As
Adjusted*

 

As
Reported

 

Impact of
Alignment

 

As
Adjusted*

 

 

 

 

REVENUES

 

 

 

 

 

 

 

 

 

 

 

 

 

Sales of vacation ownership products

$

439

 

 

$

(12

)

 

$

427

 

 

$

 

 

$

 

 

$

439

 

 

$

427

 

Management and exchange(1)

 

 

 

 

 

 

 

 

 

 

 

 

 

Ancillary

 

58

 

 

 

 

 

 

58

 

 

 

1

 

 

 

 

 

 

59

 

 

 

59

 

Management fee

 

42

 

 

 

 

 

 

42

 

 

 

6

 

 

 

 

 

 

48

 

 

 

48

 

Exchange and other services

 

32

 

 

 

 

 

 

32

 

 

 

42

 

 

 

23

 

 

 

97

 

 

 

97

 

Management and exchange

 

132

 

 

 

 

 

 

132

 

 

 

49

 

 

 

23

 

 

 

204

 

 

 

204

 

Rental

 

104

 

 

 

 

 

 

104

 

 

 

9

 

 

 

 

 

 

113

 

 

 

113

 

Financing

 

76

 

 

 

 

 

 

76

 

 

 

 

 

 

 

 

 

76

 

 

 

76

 

Cost reimbursements(1)

 

362

 

 

 

 

 

 

362

 

 

 

4

 

 

 

(10

)

 

 

356

 

 

 

356

 

TOTAL REVENUES

$

1,113

 

 

$

(12

)

 

$

1,101

 

 

$

62

 

 

$

13

 

 

$

1,188

 

 

$

1,176

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

PROFIT

 

 

 

 

 

 

 

 

 

 

 

 

 

Development

$

162

 

 

$

(7

)

 

$

155

 

 

$

 

 

$

 

 

$

162

 

 

$

155

 

Management and exchange(1)

 

70

 

 

 

 

 

 

70

 

 

 

22

 

 

 

(2

)

 

 

90

 

 

 

90

 

Rental(1)

 

15

 

 

 

 

 

 

15

 

 

 

9

 

 

 

1

 

 

 

25

 

 

 

25

 

Financing

 

50

 

 

 

 

 

 

50

 

 

 

 

 

 

 

 

 

50

 

 

 

50

 

TOTAL PROFIT

 

297

 

 

 

(7

)

 

 

290

 

 

 

31

 

 

 

(1

)

 

 

327

 

 

 

320

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

OTHER

 

 

 

 

 

 

 

 

 

 

 

 

 

General and administrative

 

 

 

 

 

 

 

 

 

 

 

 

 

(62

)

 

 

(62

)

 

 

(62

)

Depreciation and amortization

 

(25

)

 

 

 

 

 

(25

)

 

 

(7

)

 

 

(2

)

 

 

(34

)

 

 

(34

)

Litigation charges

 

(2

)

 

 

 

 

 

(2

)

 

 

 

 

 

(2

)

 

 

(4

)

 

 

(4

)

Royalty fee

 

(30

)

 

 

 

 

 

(30

)

 

 

 

 

 

 

 

 

(30

)

 

 

(30

)

Impairment

 

(1

)

 

 

 

 

 

(1

)

 

 

 

 

 

 

 

 

(1

)

 

 

(1

)

Gains and other income, net

 

1

 

 

 

 

 

 

1

 

 

 

 

 

 

 

 

 

1

 

 

 

1

 

Interest expense, net

 

 

 

 

 

 

 

 

 

 

 

 

 

(27

)

 

 

(27

)

 

 

(27

)

Transaction and integration costs

 

 

 

 

 

 

 

 

 

 

 

 

 

(26

)

 

 

(26

)

 

 

(26

)

Other

 

1

 

 

 

 

 

 

1

 

 

 

 

 

 

 

 

 

1

 

 

 

1

 

INCOME (LOSS) BEFORE INCOME TAXES AND NONCONTROLLING INTERESTS

 

241

 

 

 

(7

)

 

 

234

 

 

 

24

 

 

 

(120

)

 

 

145

 

 

 

138

 

Benefit from (provision for) income taxes

 

 

 

 

2

 

 

 

2

 

 

 

 

 

 

(57

)

 

 

(57

)

 

 

(55

)

NET INCOME (LOSS)

 

241

 

 

 

(5

)

 

 

236

 

 

 

24

 

 

 

(177

)

 

 

88

 

 

 

83

 

Net income attributable to noncontrolling interests(1)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

NET INCOME (LOSS) ATTRIBUTABLE TO COMMON STOCKHOLDERS

$

241

 

 

$

(5

)

 

$

236

 

 

$

24

 

 

$

(177

)

 

$

88

 

 

$

83

 

SEGMENT MARGIN(2)

 

32%

 

 

 

 

 

32%

 

 

 

41%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(1) Amounts included in Corporate and other represent the impact of the consolidation of certain owners’ associations under the relevant accounting guidance, and represent the portion attributable to individual or third-party vacation ownership interest owners.

(2) Segment margin represents the applicable segment’s net income or loss attributable to common stockholders divided by the applicable segment’s total revenues less cost reimbursement revenues.

* Denotes non-GAAP financial measures. Please see “Non-GAAP Financial Measures” for additional information about our reasons for providing these alternative financial measures and limitations on their use.

A-7

 

MARRIOTT VACATIONS WORLDWIDE CORPORATION

CONSOLIDATED CONTRACT SALES TO ADJUSTED DEVELOPMENT PROFIT

(In millions)

(Unaudited)

   

 

Three Months Ended

 

December
31, 2023

 

December 31, 2022

 

 

As
Reported

 

Impact of
Alignment

 

As
Adjusted*

Consolidated contract sales

$

447

 

 

$

454

 

 

$

 

 

$

454

 

Less resales contract sales

 

(10

)

 

 

(10

)

 

 

 

 

 

(10

)

Consolidated contract sales, net of resales

 

437

 

 

 

444

 

 

 

 

 

 

444

 

Plus:

 

 

 

 

 

 

 

Settlement revenue

 

10

 

 

 

10

 

 

 

 

 

 

10

 

Resales revenue

 

4

 

 

 

7

 

 

 

 

 

 

7

 

Revenue recognition adjustments:

 

 

 

 

 

 

 

Reportability

 

(2

)

 

 

36

 

 

 

(12

)

 

 

24

 

Sales reserve

 

(47

)

 

 

(40

)

 

 

 

 

 

(40

)

Other(1)

 

(27

)

 

 

(18

)

 

 

 

 

 

(18

)

Sale of vacation ownership products

 

375

 

 

 

439

 

 

 

(12

)

 

 

427

 

Less:

 

 

 

 

 

 

 

Cost of vacation ownership products

 

(50

)

 

 

(73

)

 

 

5

 

 

 

(68

)

Marketing and sales

 

(205

)

 

 

(204

)

 

 

 

 

 

(204

)

Development Profit

 

120

 

 

 

162

 

 

 

(7

)

 

 

155

 

Revenue recognition reportability adjustment

 

1

 

 

 

(27

)

 

 

7

 

 

 

(20

)

Purchase accounting adjustments

 

3

 

 

 

(1

)

 

 

 

 

 

(1

)

Other

 

 

 

 

(8

)

 

 

 

 

 

(8

)

Adjusted development profit*

$

124

 

 

$

126

 

 

$

 

 

$

126

 

Development profit margin

 

32.0%

 

 

 

36.8%

 

 

 

 

 

36.2%

 

Adjusted development profit margin*

 

33.1%

 

 

 

31.5%

 

 

 

 

 

31.5%

 

 

 

 

 

 

 

 

 

(1) Adjustment for sales incentives that will not be recognized as Sale of vacation ownership products revenue and other adjustments to Sale of vacation ownership products revenue.

* Denotes non-GAAP financial measures. Please see “Non-GAAP Financial Measures” for additional information about our reasons for providing these alternative financial measures and limitations on their use.

A-8

 

MARRIOTT VACATIONS WORLDWIDE CORPORATION

CONSOLIDATED CONTRACT SALES TO ADJUSTED DEVELOPMENT PROFIT

(In millions)

(Unaudited)

   

 

Twelve Months Ended

 

December
31, 2023

 

December 31, 2022

 

 

As
Reported

 

Impact of
Alignment

 

As
Adjusted*

Consolidated contract sales

$

1,772

 

 

$

1,837

 

 

$

 

 

$

1,837

 

Less resales contract sales

 

(42

)

 

 

(40

)

 

 

 

 

 

(40

)

Consolidated contract sales, net of resales

 

1,730

 

 

 

1,797

 

 

 

 

 

 

1,797

 

Plus:

 

 

 

 

 

 

 

Settlement revenue

 

39

 

 

 

36

 

 

 

 

 

 

36

 

Resales revenue

 

22

 

 

 

20

 

 

 

 

 

 

20

 

Revenue recognition adjustments:

 

 

 

 

 

 

 

Reportability

 

3

 

 

 

43

 

 

 

(58

)

 

 

(15

)

Sales reserve

 

(232

)

 

 

(170

)

 

 

19

 

 

 

(151

)

Other(1)

 

(102

)

 

 

(108

)

 

 

 

 

 

(108

)

Sale of vacation ownership products

 

1,460

 

 

 

1,618

 

 

 

(39

)

 

 

1,579

 

Less:

 

 

 

 

 

 

 

Cost of vacation ownership products

 

(224

)

 

 

(289

)

 

 

7

 

 

 

(282

)

Marketing and sales

 

(823

)

 

 

(807

)

 

 

 

 

 

(807

)

Development Profit

 

413

 

 

 

522

 

 

 

(32

)

 

 

490

 

Revenue recognition reportability adjustment

 

(2

)

 

 

(35

)

 

 

46

 

 

 

11

 

Purchase accounting adjustments

 

9

 

 

 

13

 

 

 

 

 

 

13

 

Other

 

 

 

 

(13

)

 

 

 

 

 

(13

)

Adjusted development profit*

$

420

 

 

$

487

 

 

$

14

 

 

$

501

 

Development profit margin

 

28.3%

 

 

 

32.2%

 

 

 

 

 

31.0%

 

Adjusted development profit margin*

 

28.8%

 

 

 

31.0%

 

 

 

 

 

31.5%

 

 

 

 

 

 

 

 

 

(1) Adjustment for sales incentives that will not be recognized as Sale of vacation ownership products revenue and other adjustments to Sale of vacation ownership products revenue.

* Denotes non-GAAP financial measures. Please see “Non-GAAP Financial Measures” for additional information about our reasons for providing these alternative financial measures and limitations on their use.

A-9

 

MARRIOTT VACATIONS WORLDWIDE CORPORATION

ADJUSTED NET INCOME ATTRIBUTABLE TO COMMON STOCKHOLDERS AND

ADJUSTED EARNINGS PER SHARE - DILUTED

(In millions, except per share amounts)

       

 

Three Months Ended

 

Twelve Months Ended

 

December 31,
2023

 

December 31,
2022

 

December 31,
2023

 

December 31,
2022

Net income attributable to common stockholders

$

35

 

 

$

88

 

 

$

254

 

 

$

391

 

Provision for income taxes

 

31

 

 

 

57

 

 

 

146

 

 

 

191

 

Income before income taxes attributable to common stockholders

 

66

 

 

 

145

 

 

 

400

 

 

 

582

 

Certain items:

 

 

 

 

 

 

 

ILG integration

 

 

 

 

18

 

 

 

15

 

 

 

98

 

Welk acquisition and integration

 

9

 

 

 

4

 

 

 

22

 

 

 

14

 

Other transformation initiatives

 

 

 

 

4

 

 

 

 

 

 

10

 

Other transaction costs

 

 

 

 

 

 

 

 

 

 

3

 

Transaction and integration costs

 

9

 

 

 

26

 

 

 

37

 

 

 

125

 

Early redemption of senior secured notes

 

 

 

 

 

 

 

10

 

 

 

 

Gain on disposition of hotel, land, and other

 

 

 

 

 

 

 

(8

)

 

 

(33

)

Gain on disposition of VRI Americas

 

 

 

 

 

 

 

 

 

 

(17

)

Foreign currency translation

 

(7

)

 

 

 

 

 

(6

)

 

 

10

 

Insurance proceeds

 

(6

)

 

 

(1

)

 

 

(9

)

 

 

(6

)

Change in indemnification asset

 

(1

)

 

 

1

 

 

 

(31

)

 

 

3

 

Other

 

1

 

 

 

(1

)

 

 

(3

)

 

 

3

 

Gains and other income, net

 

(13

)

 

 

(1

)

 

 

(47

)

 

 

(40

)

Purchase accounting adjustments

 

2

 

 

 

(2

)

 

 

8

 

 

 

11

 

Litigation charges

 

6

 

 

 

4

 

 

 

13

 

 

 

11

 

Restructuring charges

 

6

 

 

 

 

 

 

6

 

 

 

 

Impairment charges

 

28

 

 

 

1

 

 

 

32

 

 

 

2

 

Expiration/forfeiture of deposits on pre-acquisition preview packages

 

 

 

 

 

 

 

 

 

 

(6

)

Early termination of VRI management contract

 

 

 

 

 

 

 

 

 

 

(2

)

Change in estimate relating to pre-acquisition contingencies

 

 

 

 

(7

)

 

 

 

 

 

(12

)

Other

 

1

 

 

 

3

 

 

 

1

 

 

 

6

 

Adjusted pretax income*

 

105

 

 

 

169

 

 

 

450

 

 

 

677

 

Provision for income taxes

 

(30

)

 

 

(54

)

 

 

(128

)

 

 

(219

)

Adjusted net income attributable to common stockholders*

$

75

 

 

$

115

 

 

$

322

 

 

$

458

 

 

 

 

 

 

 

 

 

Diluted shares

 

42.5

 

 

 

43.0

 

 

 

43.5

 

 

 

45.2

 

Adjusted earnings per share - Diluted*

$

1.88

 

 

$

2.74

 

 

$

7.83

 

 

$

10.26

 

 

 

 

 

 

 

 

 

Excluding the Impact of Alignment:

 

 

 

 

 

 

 

Adjusted net income attributable to common stockholders*

$

75

 

 

$

110

 

 

$

322

 

 

$

420

 

Adjusted earnings per share - Diluted*

$

1.88

 

 

$

2.60

 

 

$

7.83

 

 

$

9.42

 

 

 

 

 

 

 

 

 

* Denotes non-GAAP financial measures. Please see “Non-GAAP Financial Measures” for additional information about our reasons for providing these alternative financial measures and limitations on their use.

A-10

 

MARRIOTT VACATIONS WORLDWIDE CORPORATION

ADJUSTED EBITDA

(In millions)

       

 

Three Months Ended

 

Twelve Months Ended

 

December 31,
2023

 

December 31,
2022

 

December 31,
2023

 

December 31,
2022

NET INCOME ATTRIBUTABLE TO COMMON STOCKHOLDERS

$

35

 

 

$

88

 

 

$

254

 

 

$

391

 

Interest expense, net

 

39

 

 

 

27

 

 

 

145

 

 

 

118

 

Provision for income taxes

 

31

 

 

 

57

 

 

 

146

 

 

 

191

 

Depreciation and amortization

 

36

 

 

 

34

 

 

 

135

 

 

 

132

 

Share-based compensation

 

6

 

 

 

9

 

 

 

31

 

 

 

39

 

Certain items:

 

 

 

 

 

 

 

ILG integration

 

 

 

 

18

 

 

 

15

 

 

 

98

 

Welk acquisition and integration

 

9

 

 

 

4

 

 

 

22

 

 

 

14

 

Other transformation initiatives

 

 

 

 

4

 

 

 

 

 

 

10

 

Other transaction costs

 

 

 

 

 

 

 

 

 

 

3

 

Transaction and integration costs

 

9

 

 

 

26

 

 

 

37

 

 

 

125

 

Early redemption of senior secured notes

 

 

 

 

 

 

 

10

 

 

 

 

Gain on disposition of hotel, land, and other

 

 

 

 

 

 

 

(8

)

 

 

(33

)

Gain on disposition of VRI Americas

 

 

 

 

 

 

 

 

 

 

(17

)

Foreign currency translation

 

(7

)

 

 

 

 

 

(6

)

 

 

10

 

Insurance proceeds

 

(6

)

 

 

(1

)

 

 

(9

)

 

 

(6

)

Change in indemnification asset

 

(1

)

 

 

1

 

 

 

(31

)

 

 

3

 

Other

 

1

 

 

 

(1

)

 

 

(3

)

 

 

3

 

Gains and other income, net

 

(13

)

 

 

(1

)

 

 

(47

)

 

 

(40

)

Purchase accounting adjustments

 

2

 

 

 

(2

)

 

 

8

 

 

 

11

 

Litigation charges

 

6

 

 

 

4

 

 

 

13

 

 

 

11

 

Restructuring charges

 

6

     

     

6

     

 

Impairment charges

 

28

 

 

 

1

 

 

 

32

 

 

 

2

 

Expiration/forfeiture of deposits on pre-acquisition preview packages

 

 

 

 

 

 

 

 

 

 

(6

)

Early termination of VRI management contract

 

 

 

 

 

 

 

 

 

 

(2

)

Change in estimate relating to pre-acquisition contingencies

 

 

 

 

(7

)

 

 

 

 

 

(12

)

Other

 

1

 

 

 

3

 

 

 

1

 

 

 

6

 

ADJUSTED EBITDA*

$

186

 

 

$

239

 

 

$

761

 

 

$

966

 

ADJUSTED EBITDA MARGIN*

 

23%

 

 

 

29%

 

 

 

24%

 

 

 

29%

 

 

 

 

 

 

 

 

 

Excluding the Impact of Alignment

 

 

 

 

 

 

 

ADJUSTED EBITDA*

$

186

 

 

$

232

 

 

$

761

 

 

$

915

 

ADJUSTED EBITDA MARGIN*

 

23%

 

 

 

28%

 

 

 

24%

 

 

 

28%

 

 

 

 

 

 

 

 

 

* Denotes non-GAAP financial measures. Please see “Non-GAAP Financial Measures” for additional information about our reasons for providing these alternative financial measures and limitations on their use.

A-11

 

MARRIOTT VACATIONS WORLDWIDE CORPORATION

(In millions)

(Unaudited)

VACATION OWNERSHIP SEGMENT ADJUSTED EBITDA

       

 

Three Months Ended

 

Twelve Months Ended

 

December 31,
2023

 

December 31,
2022

 

December 31,
2023

 

December 31,
2022

SEGMENT FINANCIAL RESULTS ATTRIBUTABLE TO COMMON STOCKHOLDERS

$

199

 

 

$

241

 

 

$

777

 

 

$

961

 

Depreciation and amortization

 

24

 

 

 

25

 

 

 

93

 

 

 

92

 

Share-based compensation

 

2

 

 

 

2

 

 

 

8

 

 

 

7

 

Certain items:

 

 

 

 

 

 

 

Transaction and integration costs

 

 

 

 

 

 

 

 

 

 

3

 

Gain on disposition of hotel, land, and other

 

 

 

 

 

 

 

(7

)

 

 

(33

)

Insurance proceeds

 

(6

)

 

 

(1

)

 

 

(9

)

 

 

(4

)

Change in indemnification asset

 

 

 

 

 

 

 

(9

)

 

 

 

Other

 

 

 

 

 

 

 

(4

)

 

 

 

Gains and other income, net

 

(6

)

 

 

(1

)

 

 

(29

)

 

 

(37

)

Purchase accounting adjustments

 

2

 

 

 

(2

)

 

 

8

 

 

 

11

 

Litigation charges

 

4

 

 

 

2

 

 

 

12

 

 

 

9

 

Impairment charges

 

8

 

 

 

1

 

 

 

12

 

 

 

2

 

Expiration/forfeiture of deposits on pre-acquisition preview packages

 

 

 

 

 

 

 

 

 

 

(6

)

Change in estimate relating to pre-acquisition contingencies

 

 

 

 

(7

)

 

 

 

 

 

(12

)

Other

 

3

 

 

 

 

 

 

2

 

 

 

3

 

SEGMENT ADJUSTED EBITDA*

$

236

 

 

$

261

 

 

$

883

 

 

$

1,033

 

SEGMENT ADJUSTED EBITDA MARGIN*

 

32%

 

 

 

35%

 

 

 

31%

 

 

 

35%

 

 

 

 

 

 

 

 

 

Excluding the Impact of Alignment

 

 

 

 

 

 

 

SEGMENT ADJUSTED EBITDA*

$

236

 

 

$

254

 

 

$

883

 

 

$

982

 

SEGMENT ADJUSTED EBITDA MARGIN*

 

32%

 

 

 

34%

 

 

 

31%

 

 

 

34%

 

EXCHANGE & THIRD-PARTY MANAGEMENT SEGMENT ADJUSTED EBITDA

 

Three Months Ended

 

Twelve Months Ended

 

December 31,
2023

 

December 31,
2022

 

December 31,
2023

 

December 31,
2022

SEGMENT FINANCIAL RESULTS ATTRIBUTABLE TO COMMON STOCKHOLDERS

$

18

 

 

$

24

 

 

$

93

 

 

$

132

 

Depreciation and amortization

 

8

 

 

 

7

 

 

 

31

 

 

 

31

 

Share-based compensation

 

1

 

 

 

 

 

 

2

 

 

 

2

 

Certain items:

 

 

 

 

 

 

 

Gain on disposition of hotel, land, and other

 

 

 

 

 

 

 

(1

)

 

 

 

Gain on disposition of VRI Americas

 

 

 

 

 

 

 

 

 

 

(17

)

Foreign currency translation

 

 

 

 

 

 

 

 

 

 

2

 

Litigation charges

 

1

 

 

 

 

 

 

1

 

 

 

 

Impairment charges

 

4

 

 

 

 

 

 

4

 

 

 

 

Early termination of VRI management contract

 

 

 

 

 

 

 

 

 

 

(2

)

Other

 

(1

)

 

 

 

 

 

 

 

 

 

SEGMENT ADJUSTED EBITDA*

$

31

 

 

$

31

 

 

$

130

 

 

$

148

 

SEGMENT ADJUSTED EBITDA MARGIN*

 

52%

 

 

 

55%

 

 

 

52%

 

 

 

55%

 

 

 

 

 

 

 

 

 

* Denotes non-GAAP financial measures. Please see “Non-GAAP Financial Measures” for additional information about our reasons for providing these alternative financial measures and limitations on their use.

A-12

 

MARRIOTT VACATIONS WORLDWIDE CORPORATION

(In millions)

(unaudited)

 

BALANCE SHEET ITEMS

       

 

 

Fiscal Year

 

 

2023

 

2022

Cash and cash equivalents

 

$

248

 

 

$

524

 

Vacation ownership notes receivable, net

 

$

2,343

 

 

$

2,198

 

Inventory

 

$

634

 

 

$

660

 

Property and equipment, net

 

$

1,260

 

 

$

1,139

 

Goodwill

 

$

3,117

 

 

$

3,117

 

Intangibles, net

 

$

854

 

 

$

911

 

Debt, net

 

$

3,049

 

 

$

3,088

 

Stockholders’ equity

 

$

2,382

 

 

$

2,496

 

SUMMARY CASH FLOW

 

Fiscal Year

CASH FLOW

 

2023

 

 

 

2022

 

Cash, cash equivalents, and restricted cash provided by (used in):

 

 

 

Operating activities

$

232

 

 

$

522

 

Investing activities

 

(112

)

 

 

16

 

Financing activities

 

(401

)

 

 

(486

)

Effect of changes in exchange rates on cash, cash equivalents, and restricted cash

 

1

 

 

 

(1

)

Net change in cash, cash equivalents, and restricted cash

$

(280

)

 

$

51

 

 

 

 

 

* Denotes non-GAAP financial measures. Please see “Non-GAAP Financial Measures” for additional information about our reasons for providing these alternative financial measures and limitations on their use.

A-13

 

MARRIOTT VACATIONS WORLDWIDE CORPORATION

(In millions, except per share amounts)

 

2024 ADJUSTED NET INCOME ATTRIBUTABLE TO COMMON STOCKHOLDERS AND

ADJUSTED EARNINGS PER SHARE - DILUTED OUTLOOK

       

 

Fiscal Year 2024
(Low)

 

Fiscal Year 2024
(High)

Net income attributable to common stockholders

$

285

 

 

$

320

 

Provision for income taxes

 

119

 

 

 

134

 

Income before income taxes attributable to common stockholders

 

404

 

 

 

454

 

Certain items(1)

 

29

 

 

 

24

 

Adjusted pretax income*

 

433

 

 

 

478

 

Provision for income taxes

 

(128

)

 

 

(143

)

Adjusted net income attributable to common stockholders*

$

305

 

 

$

335

 

Earnings per share - Diluted(2)(3)

$

7.17

 

 

$

8.00

 

Adjusted earnings per share - Diluted(2)(3)*

$

7.65

 

 

$

8.35

 

Diluted shares(2)

 

42.3

 

 

 

42.3

 

2024 ADJUSTED EBITDA OUTLOOK

           

 

Fiscal Year 2024
(Low)

 

Fiscal Year 2024
(High)

Net income attributable to common stockholders

$

285

 

 

$

320

 

Interest expense

 

161

 

 

 

156

 

Provision for income taxes

 

119

 

 

 

134

 

Depreciation and amortization

 

128

 

 

 

128

 

Share-based compensation

 

38

 

 

 

38

 

Certain items(1)

 

29

 

 

 

24

 

Adjusted EBITDA*

$

760

 

 

$

800

 

(1) Certain items adjustment includes $10 million to $15 million of anticipated transaction and integration costs, $12 million of anticipated litigation charges and $2 million of anticipated purchase accounting adjustments.

(2) Includes 6.5 million shares from the assumed conversion of our convertible notes.

(3) Includes an add back of $19 million of interest expense related to our convertible notes, net of tax for purposes of calculating net income in the diluted earnings per share calculation.

* Denotes non-GAAP financial measures. Please see “Non-GAAP Financial Measures” for additional information about our reasons for providing these alternative financial measures and limitations on their use.

A-14

 

MARRIOTT VACATIONS WORLDWIDE CORPORATION

2024 ADJUSTED FREE CASH FLOW OUTLOOK

(In millions)

       

 

Fiscal Year 2024
(Low)

 

Fiscal Year 2024
(High)

Net cash, cash equivalents and restricted cash provided by operating activities

$

265

 

 

$

295

 

Capital expenditures for property and equipment (excluding inventory)

 

(65

)

 

 

(85

)

Borrowings from securitizations, net of repayments

 

166

 

 

 

195

 

Securitized debt issuance costs

 

(14

)

 

 

(15

)

Free cash flow*

 

352

 

 

 

390

 

Adjustments:

 

 

 

Net change in borrowings available from the securitization of eligible vacation ownership notes receivable(1)

 

25

 

 

 

40

 

Certain items(2)

 

23

 

 

 

20

 

Adjusted free cash flow*

$

400

 

 

$

450

 

(1) Represents the anticipated net change in borrowings available from the securitization of eligible vacation ownership notes receivable between the 2023 and 2024 year ends.

(2) Certain items adjustment consists primarily of the after-tax impact of anticipated transaction and integration costs and litigation charges.

* Denotes non-GAAP financial measures. Please see “Non-GAAP Financial Measures” for additional information about our reasons for providing these alternative financial measures and limitations on their use.

A-15

 

MARRIOTT VACATIONS WORLDWIDE CORPORATION

QUARTERLY OPERATING METRICS

(Contract sales in millions)

           

 

Year

 

Quarter Ended

 

Full Year

 

 

March 31

 

June 30

 

September 30

 

December 31

 

Vacation Ownership

 

 

 

 

 

 

 

 

 

 

 

Consolidated contract sales

 

 

 

 

 

 

 

 

 

 

 

 

2023

 

$

434

 

$

453

 

$

438

 

$

447

 

$

1,772

 

2022

 

$

394

 

$

506

 

$

483

 

$

454

 

$

1,837

 

2021

 

$

226

 

$

362

 

$

380

 

$

406

 

$

1,374

 

 

 

 

 

 

 

 

 

 

 

 

VPG

 

 

 

 

 

 

 

 

 

 

 

 

2023

 

$

4,358

 

$

3,968

 

$

4,055

 

$

4,002

 

$

4,088

 

2022

 

$

4,706

 

$

4,613

 

$

4,353

 

$

4,088

 

$

4,421

 

2021

 

$

4,644

 

$

4,304

 

$

4,300

 

$

4,305

 

$

4,356

 

 

 

 

 

 

 

 

 

 

 

 

Tours

 

 

 

 

 

 

 

 

 

 

 

 

2023

 

 

92,890

 

 

106,746

 

 

100,609

 

 

105,580

 

 

405,825

 

2022

 

 

78,505

 

 

102,857

 

 

104,000

 

 

105,231

 

 

390,593

 

2021

 

 

45,871

 

 

79,900

 

 

84,098

 

 

89,495

 

 

299,364

 

 

 

 

 

 

 

 

 

 

 

 

Exchange & Third-Party Management

 

 

 

 

 

 

 

 

 

 

Total active Interval International members (000's)(1)

 

 

 

 

 

 

 

 

 

 

 

 

2023

 

 

1,568

 

 

1,566

 

 

1,571

 

 

1,564

 

 

1,564

 

2022

 

 

1,606

 

 

1,596

 

 

1,591

 

 

1,566

 

 

1,566

 

2021

 

 

1,479

 

 

1,321