Travel + Leisure Co. (NYSE:TNL), the world’s leading membership and leisure travel company, today reported third quarter 2021 financial results for the three months ended September 30, 2021. Highlights and outlook include:
- Net income from continuing operations of $101 million ($1.15 diluted earnings per share) on net revenue of $839 million
- Adjusted EBITDA of $228 million and adjusted diluted earnings per share of $1.19 (1)
- Net cash provided by operating activities of $435 million and adjusted free cash flow of $128 million for the first nine months of 2021
- Increased full year adjusted EBITDA guidance to a range of $740 million to $750 million and increased full year adjusted diluted EPS guidance to a range of $3.35 to $3.43
- Management will recommend increasing the fourth quarter dividend to $0.35 per share for approval by the Board of Directors
- On October 22, 2021, renewed $1 billion revolving credit facility and exited the amendment to the credit agreement
- Executed $350 million term securitization on October 26, 2021
“Our cornerstone brands continued to demonstrate their strength in the third quarter as our businesses delivered adjusted EBITDA at or above our expectations,” said Michael D. Brown, president and CEO of Travel + Leisure Co. “Robust sales volume per guest, combined with a continued focus on cost control, allowed us to deliver on the bottom line with strong margins."
“As we said last month, the desire for leisure travel has never been stronger. Bookings at our vacation ownership resorts for the remainder of the year are ahead of 2019 levels, clearly demonstrating that people are planning to get back on vacation, which will benefit all of our businesses as we close out the year.”
(1) This press release includes adjusted EBITDA, adjusted diluted EPS, adjusted free cash flow, gross VOI sales and adjusted net income/(loss), which are metrics that are not calculated in accordance with Generally Accepted Accounting Principles in the U.S. (“GAAP”). See "Presentation of Financial Information" and the tables for the definitions and reconciliations of these non-GAAP measures to the most directly comparable GAAP measures. Forward-looking non-GAAP measures are presented in this press release only on a non-GAAP basis because not all of the information necessary for a quantitative reconciliation is available without unreasonable effort. |
Business Segment Results
The results of operations during the third quarter of 2021 and 2020 include impacts related to the COVID-19 global pandemic. Refer to Table 8 for a breakout of COVID-19 related impacts.
Vacation Ownership |
||||||
$ in millions |
Q3 2021 |
Q3 2020 |
% change |
|||
Revenue |
$660 |
|
$475 |
|
39 |
% |
Adjusted EBITDA |
$177 |
|
$93 |
|
90 |
% |
Vacation Ownership revenue increased 39% to $660 million in the third quarter of 2021 compared to the same period in the prior year. Gross vacation ownership interest (VOI) sales were $440 million compared to $256 million in the prior year and tours were 129,000 during the quarter compared to 80,000 in the same period last year. Volume Per Guest (VPG) was $3,233 due to strong close rates and higher quality tours.
Third quarter adjusted EBITDA was $177 million compared to $93 million in the prior year period. The increase was driven by higher Gross VOI sales due to the ongoing recovery of our operations from COVID-19 and cost savings initiated in the prior year, partially offset by lower net interest income as a result of a lower average contract receivable portfolio.
Third quarter 2021 results include an adjustment to the COVID-19 related allowance for loan losses, resulting in a $21 million increase to revenue and an $8 million increase to cost of vacation ownership interests, and yielding a net positive impact to Adjusted EBITDA of $13 million.
Travel and Membership |
||||||
$ in millions |
Q3 2021 |
Q3 2020 |
% change |
|||
Revenue |
$185 |
|
$145 |
|
28 |
% |
Adjusted EBITDA |
$68 |
|
$62 |
|
10 |
% |
Travel and Membership revenue increased 28% to $185 million in the third quarter driven by a 32% increase in transactions. This reflects the third consecutive quarter of year over year transaction improvement as we continue to see the business recover from COVID-19.
Third quarter Adjusted EBITDA increased 10% to $68 million, driven by revenue improvement partially offset by higher operational support costs.
Balance Sheet and Liquidity
Net Debt — As of September 30, 2021, the Company's leverage ratio for covenant purposes was 4.2x. The Company had $3.4 billion of corporate debt outstanding as of September 30, 2021, which excluded $2.0 billion of non-recourse debt related to its securitized notes receivables portfolio. Additionally, the Company had cash and cash equivalents of $346 million. At the end of the third quarter, the Company had $1.3 billion of liquidity in cash and cash equivalents and revolving credit facility availability.
Subsequent to the end of the quarter, the Company renewed its $1 billion revolving credit facility and extended the term through October 2026. In addition, this renewal terminated the relief period and restrictions regarding share repurchases, dividends and acquisitions under the first amendment.
Timeshare Receivables Financing — Subsequent to the end of the quarter, the Company closed on a $350 million term securitization transaction with a weighted average coupon of 1.82% and 98% advance rate.
Cash Flow — For the nine months ended September 30, 2021, net cash provided by operating activities was $435 million, compared to $224 million in the prior year period. Adjusted free cash flow was $128 million for the nine months ended September 30, 2021 compared to $120 million in the same period of 2020.
Dividend — The Company paid $26 million ($0.30 per share) in cash dividends on September 30, 2021 to shareholders of record as of September 15, 2021. Management will recommend a fourth quarter dividend of $0.35 per share for approval by the Company’s Board of Directors in November 2021.
Outlook
The Company is updating its guidance regarding expectations for the 2021 full year:
- Adjusted EBITDA of $740 million to $750 million from $725 million to $735 million
- Adjusted diluted EPS of $3.35 to $3.43 from $3.24 to $3.30
- Gross VOI sales of $1.45 billion to $1.5 billion from $1.4 billion to $1.5 billion
- Tours of 440,000 to 450,000
- VPG of approximately $3,000
This guidance is presented only on a non-GAAP basis because not all of the information necessary for a quantitative reconciliation of forward-looking non-GAAP financial measures to the most directly comparable GAAP financial measure is available without unreasonable effort, primarily due to uncertainties relating to the occurrence or amount of these adjustments that may arise in the future.
Conference Call Information
Travel + Leisure Co. will hold a conference call with investors to discuss the Company’s results and outlook today at 8:30 a.m. ET. Participants may listen to a simultaneous webcast of the conference call, which may be accessed through the Company's website at investor.travelandleisureco.com, or by dialing 866-342-8591, passcode TNL, 10 minutes before the scheduled start time. For those unable to listen to the live broadcast, an archive of the webcast will be available on the Company's website for 90 days beginning at 12:00 p.m. ET today. Additionally, a telephone replay will be available for four days beginning at 12:00 p.m. ET today at 800-695-1564.
Presentation of Financial Information
Financial information discussed in this press release includes non-GAAP measures such as adjusted EBITDA, adjusted EBITDA margin, adjusted diluted EPS, adjusted free cash flow, gross VOI sales, and adjusted net income/(loss), which include or exclude certain items, as well as non-GAAP guidance. The Company utilizes these non-GAAP measures, defined in Table 9, on a regular basis to assess performance of its reportable segments and allocate resources. These non-GAAP measures differ from reported GAAP results and are intended to illustrate what management believes are relevant period-over-period comparisons and are helpful to investors when considered with GAAP measures as an additional tool for further understanding and assessing the Company’s ongoing operating performance by adjusting for items which in our view do not necessarily reflect ongoing performance. Management also internally uses these measures to assess our operating performance, both absolutely and in comparison to other companies, and in evaluating or making selected compensation decisions. Exclusion of items in the Company’s non-GAAP presentation should not be considered an inference that these items are unusual, infrequent or non-recurring. Full reconciliations of historical non-GAAP financial measures to the most directly comparable GAAP financial measures for the reported periods appear in the financial tables section of the press release. See definitions on Table 9 for an explanation of our non-GAAP measures.
About Travel + Leisure Co.
Travel + Leisure Co. is the world’s leading membership and leisure travel company, with nearly 20 travel brands across its resort, travel club, and lifestyle portfolio. The company provides outstanding vacation experiences and travel inspiration to millions of owners, members, and subscribers every year through its products and services: Wyndham Destinations, the largest vacation ownership company with more than 245 vacation club resort locations across the globe; Panorama, the world’s foremost membership travel business that includes the largest vacation exchange company, industry-leading travel technology, and subscription travel brands; and Travel + Leisure Group, featuring top travel content, travel services including the brand’s eponymous travel club, and branded consumer products. At Travel + Leisure Co., our global team of associates brings hospitality to millions each year, turning vacation inspiration into exceptional travel experiences. We put the world on vacation. Learn more at travelandleisureco.com.
Forward-Looking Statements
This press release includes “forward-looking statements” as that term is defined by the Securities and Exchange Commission (“SEC”). Forward-looking statements are any statements other than statements of historical fact, including statements regarding our expectations, beliefs, hopes, intentions or strategies regarding the future. In some cases, forward-looking statements can be identified by the use of words such as “may,” “will,” “expects,” “should,” “believes,” “plans,” “anticipates,” “estimates,” “predicts,” “potential,” “continue,” “future” or other words of similar meaning. Forward-looking statements are subject to risks and uncertainties that could cause actual results of Travel + Leisure Co. and its subsidiaries (“Travel + Leisure Co.” or “we”) to differ materially from those discussed in, or implied by, the forward-looking statements. Factors that might cause such a difference include, but are not limited to, uncertainty with respect to our ability to realize the benefits of the Travel + Leisure brand acquisition; the scope and duration of the novel coronavirus global pandemic (“COVID-19”), any resurgences and the pace of recovery; the timing of the widespread distribution and use of an effective vaccine or treatment for COVID-19; the potential impact of governmental, business and individuals’ actions in response to the COVID-19 pandemic and our related contingency plans, including reductions in investment in our business, vacation ownership interest sales and tour flow, and consumer demand and liquidity; our ability to comply with financial and restrictive covenants under our indebtedness and our ability to access capital on reasonable terms, at a reasonable cost or at all; our ability and the ability of Wyndham Hotels & Resorts, Inc. (“Wyndham Hotels”) to maintain credit ratings; general economic conditions and unemployment rates, the performance of the financial and credit markets; the competition in and the economic environment for the leisure travel industry; risks associated with employees working remotely or operating with a reduced workforce; the impact of war, terrorist activity, political strife, severe weather events and other natural disasters, and pandemics (including COVID-19) or threats of pandemics; operating risks associated with the Vacation Ownership and Travel and Membership segments; uncertainties related to strategic transactions, including the spin-off of our hotels business, Wyndham Hotels, and any potential impact on our relationships with our customers, suppliers, employees and others with whom we have relationships, and possible disruption to our operations; our ability to execute on our strategy; the timing and amount of future dividends and share repurchases, if any, and those other factors disclosed as risks under “Risk Factors” in documents we have filed with the SEC, including in Part I, Item 1A. of our Annual Report on Form 10-K for the fiscal year ended December 31, 2020, filed with the SEC on February 24, 2021. We caution readers that any such statements are based on currently available operational, financial and competitive information, and they should not place undue reliance on these forward-looking statements, which reflect management’s opinion only as of the date on which they were made. Except as required by law, we undertake no obligation to review or update these forward-looking statements to reflect events or circumstances as they occur.
Travel + Leisure Co.
Table of Contents
Table Number
- Condensed Consolidated Statements of Income/(Loss) (Unaudited)
- Summary Data Sheet
- Operating Statistics
- Revenue by Reportable Segment
- Non-GAAP Measure: Reconciliation of Net Income/(Loss) to Adjusted Net Income/(Loss) to Adjusted EBITDA
- Non-GAAP Measure: Reconciliation of Net VOI Sales to Gross VOI Sales
- Non-GAAP Measure: Reconciliation of Net Cash Provided by Operating Activities to Adjusted Free Cash Flow
- COVID-19 Impacts
-
Definitions
Table 1 |
|||||||||||||||
Travel + Leisure Co. Condensed Consolidated Statements of Income/(Loss) (Unaudited) (in millions, except per share amounts) |
|||||||||||||||
|
Three Months Ended |
|
Nine Months Ended |
||||||||||||
|
September 30, |
|
September 30, |
||||||||||||
|
2021 |
|
2020 |
|
2021 |
|
2020 |
||||||||
Net revenues |
|
|
|
|
|
|
|
||||||||
Service and membership fees |
$ |
378 |
|
|
$ |
291 |
|
|
$ |
1,114 |
|
|
$ |
845 |
|
Net VOI sales |
344 |
|
|
196 |
|
|
810 |
|
|
273 |
|
||||
Consumer financing |
103 |
|
|
115 |
|
|
304 |
|
|
360 |
|
||||
Other |
14 |
|
|
12 |
|
|
36 |
|
|
37 |
|
||||
Net revenues |
839 |
|
|
614 |
|
|
2,264 |
|
|
1,515 |
|
||||
|
|
|
|
|
|
|
|
||||||||
Expenses |
|
|
|
|
|
|
|
||||||||
Operating |
352 |
|
|
263 |
|
|
992 |
|
|
861 |
|
||||
Cost/(recovery) of vacation ownership interests |
43 |
|
|
22 |
|
|
105 |
|
|
(26 |
) |
||||
Consumer financing interest |
19 |
|
|
26 |
|
|
63 |
|
|
76 |
|
||||
General and administrative |
106 |
|
|
101 |
|
|
325 |
|
|
295 |
|
||||
Marketing |
101 |
|
|
84 |
|
|
261 |
|
|
247 |
|
||||
Depreciation and amortization |
31 |
|
|
32 |
|
|
93 |
|
|
94 |
|
||||
COVID-19 related costs |
1 |
|
|
14 |
|
|
3 |
|
|
81 |
|
||||
Asset impairments |
— |
|
|
6 |
|
|
— |
|
|
50 |
|
||||
Restructuring |
— |
|
|
2 |
|
|
(1 |
) |
|
27 |
|
||||
Total expenses |
653 |
|
|
550 |
|
|
1,841 |
|
|
1,705 |
|
||||
|
|
|
|
|
|
|
|
||||||||
Operating income/(loss) |
186 |
|
|
64 |
|
|
423 |
|
|
(190 |
) |
||||
Other (income), net |
— |
|
|
(5 |
) |
|
(2 |
) |
|
(11 |
) |
||||
Interest expense |
47 |
|
|
52 |
|
|
147 |
|
|
138 |
|
||||
Interest (income) |
(1 |
) |
|
(2 |
) |
|
(1 |
) |
|
(5 |
) |
||||
Income/(loss) before income taxes |
140 |
|
|
19 |
|
|
279 |
|
|
(312 |
) |
||||
Provision/(benefit) for income taxes |
39 |
|
|
(21 |
) |
|
76 |
|
|
(54 |
) |
||||
Net income/(loss) from continuing operations |
101 |
|
|
40 |
|
|
203 |
|
|
(258 |
) |
||||
Loss on disposal of discontinued business, net of income taxes |
— |
|
|
— |
|
|
(2 |
) |
|
— |
|
||||
Net income/(loss) attributable to TNL shareholders |
$ |
101 |
|
|
$ |
40 |
|
|
$ |
201 |
|
|
$ |
(258 |
) |
|
|
|
|
|
|
|
|
||||||||
Basic earnings/(loss) per share |
|
|
|
|
|
|
|
||||||||
Continuing operations |
$ |
1.16 |
|
|
$ |
0.47 |
|
|
$ |
2.35 |
|
|
$ |
(3.00 |
) |
Discontinued operations |
— |
|
|
— |
|
|
(0.02 |
) |
|
— |
|
||||
|
$ |
1.16 |
|
|
$ |
0.47 |
|
|
$ |
2.33 |
|
|
$ |
(3.00 |
) |
|
|
|
|
|
|
|
|
||||||||
Diluted earnings/(loss) per share |
|
|
|
|
|
|
|
||||||||
Continuing operations |
$ |
1.15 |
|
|
$ |
0.47 |
|
|
$ |
2.33 |
|
|
$ |
(3.00 |
) |
Discontinued operations |
— |
|
|
— |
|
|
(0.03 |
) |
|
— |
|
||||
|
$ |
1.15 |
|
|
$ |
0.47 |
|
|
$ |
2.30 |
|
|
$ |
(3.00 |
) |
|
|
|
|
|
|
|
|
||||||||
Weighted average shares outstanding |
|
|
|
|
|
|
|
||||||||
Basic |
86.6 |
|
|
85.9 |
|
|
86.5 |
|
|
86.1 |
|
||||
Diluted |
87.4 |
|
|
86.1 |
|
|
87.3 |
|
|
86.1 |
|
||||
Table 2 |
|||||||||||||||||||||
Travel + Leisure Co. Summary Data Sheet (in millions, except per share amounts, unless otherwise indicated) |
|||||||||||||||||||||
|
Three Months Ended September 30, |
|
Nine Months Ended September 30, |
||||||||||||||||||
|
2021 |
|
2020 |
|
Change |
|
2021 |
|
2020 |
|
Change |
||||||||||
Consolidated Results |
|
|
|
|
|
|
|
|
|
|
|
||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Net income/(loss) attributable to TNL shareholders |
$ |
101 |
|
|
$ |
40 |
|
|
153 |
% |
|
$ |
201 |
|
|
$ |
(258 |
) |
|
178 |
% |
Diluted earnings/(loss) per share |
$ |
1.15 |
|
|
$ |
0.47 |
|
|
145 |
% |
|
$ |
2.30 |
|
|
$ |
(3.00 |
) |
|
177 |
% |
Net income/(loss) from continuing operations |
$ |
101 |
|
|
$ |
40 |
|
|
153 |
% |
|
$ |
203 |
|
|
$ |
(258 |
) |
|
179 |
% |
Diluted earnings/(loss) per share from continuing operations |
$ |
1.15 |
|
|
$ |
0.47 |
|
|
145 |
% |
|
$ |
2.33 |
|
|
$ |
(3.00 |
) |
|
178 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Net income/(loss) margin |
12.0 |
% |
|
6.5 |
% |
|
|
|
8.9 |
% |
|
(17.0 |
)% |
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Adjusted Earnings/(Loss) |
|
|
|
|
|
|
|
|
|
|
|||||||||||
Adjusted EBITDA |
$ |
228 |
|
|
$ |
139 |
|
|
64 |
% |
|
$ |
550 |
|
|
$ |
111 |
|
|
395 |
% |
Adjusted net income/(loss) |
$ |
104 |
|
|
$ |
71 |
|
|
46 |
% |
|
$ |
214 |
|
|
$ |
(108 |
) |
|
298 |
% |
Adjusted diluted earnings/(loss) per share |
$ |
1.19 |
|
|
$ |
0.83 |
|
|
43 |
% |
|
$ |
2.46 |
|
|
$ |
(1.26 |
) |
|
295 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Segment Results |
|
|
|
|
|
|
|
|
|
|
|
||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Net Revenues |
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Vacation Ownership |
$ |
660 |
|
|
$ |
475 |
|
|
39 |
% |
|
$ |
1,708 |
|
|
$ |
1,116 |
|
|
53 |
% |
Travel and Membership |
185 |
|
|
145 |
|
|
28 |
% |
|
573 |
|
|
411 |
|
|
39 |
% |
||||
Corporate and other |
(6 |
) |
|
(6 |
) |
|
|
|
(17 |
) |
|
(12 |
) |
|
|
||||||
Total |
$ |
839 |
|
|
$ |
614 |
|
|
37 |
% |
|
$ |
2,264 |
|
|
$ |
1,515 |
|
|
49 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Adjusted EBITDA |
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Vacation Ownership |
$ |
177 |
|
|
$ |
93 |
|
|
90 |
% |
|
$ |
377 |
|
|
$ |
6 |
|
|
NM |
|
Travel and Membership |
68 |
|
|
62 |
|
|
10 |
% |
|
218 |
|
|
142 |
|
|
54 |
% |
||||
Segment Adjusted EBITDA |
245 |
|
|
155 |
|
|
|
|
595 |
|
|
148 |
|
|
|
||||||
Corporate and other |
(17 |
) |
|
(16 |
) |
|
|
|
(45 |
) |
|
(37 |
) |
|
|
||||||
Total Adjusted EBITDA |
$ |
228 |
|
|
$ |
139 |
|
|
64 |
% |
|
$ |
550 |
|
|
$ |
111 |
|
|
395 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Adjusted EBITDA margin |
27.2 |
% |
|
22.6 |
% |
|
|
|
24.3 |
% |
|
7.3 |
% |
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Key Operating Statistics |
|
|
|
|
|
|
|
|
|
|
|
||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Vacation Ownership |
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Gross VOI sales |
$ |
440 |
|
|
$ |
256 |
|
|
72 |
% |
|
$ |
1,059 |
|
|
$ |
687 |
|
|
54 |
% |
Tours (in thousands) |
129 |
|
|
80 |
|
|
61 |
% |
|
323 |
|
|
248 |
|
|
30 |
% |
||||
VPG (in dollars) |
$ |
3,233 |
|
|
$ |
3,039 |
|
|
6 |
% |
|
$ |
3,112 |
|
|
$ |
2,331 |
|
|
34 |
% |
New owner sales, volume mix |
30.1 |
% |
|
27.6 |
% |
|
|
|
29.1 |
% |
|
28.1 |
% |
|
|
||||||
New owner sales, transaction mix |
29.9 |
% |
|
23.8 |
% |
|
|
|
29.1 |
% |
|
30.5 |
% |
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Travel and Membership |
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Transactions (in thousands) |
470 |
|
|
356 |
|
|
32 |
% |
|
1,508 |
|
|
873 |
|
|
73 |
% |
||||
Revenue per transaction (in dollars) |
$ |
282 |
|
|
$ |
243 |
|
|
16 |
% |
|
$ |
277 |
|
|
$ |
260 |
|
|
7 |
% |
Avg. number of exchange members (in thousands) |
3,895 |
|
|
3,680 |
|
|
6 |
% |
|
3,684 |
|
|
3,781 |
|
|
(3 |
)% |
||||
NM is defined as Not Meaningful. |
Note: Amounts may not calculate due to rounding. See Table 9 for definitions. For a full reconciliation of non-GAAP financial measures to the most directly comparable GAAP financial measures, refer to Table 5 and Table 6. See "Presentation of Financial Information" and the tables for the definitions and reconciliations of these non-GAAP measures in accordance with GAAP. |
In connection with the Travel + Leisure brand acquisition we updated the names and composition of our reportable segments to better align with how they are managed. We created the Travel + Leisure Group which falls under the Travel and Membership segment along with the Panorama business line. With the formation of Travel + Leisure Group, we decided that the operations of our Extra Holidays business, which focuses on direct to consumer bookings, better aligns with the operations of this new business line and therefore transitioned the management of our Extra Holidays business to the Travel and Membership segment. As such, we reclassified the results of our Extra Holidays business, which were previously reported within the Vacation Ownership segment, into the Travel and Membership segment. |
Table 3 |
|||||||||||||||||||||
Travel + Leisure Co. Operating Statistics: Vacation Ownership |
|||||||||||||||||||||
The following operating statistics are the significant drivers of the Company's revenues and therefore provide an enhanced understanding of the Company's businesses: |
|||||||||||||||||||||
|
|||||||||||||||||||||
|
Year |
|
Q1 |
|
Q2 |
|
Q3 |
|
Q4 |
|
Full Year |
||||||||||
Gross VOI Sales (in millions) (a) |
2021 |
|
$ |
236 |
|
|
$ |
383 |
|
|
$ |
440 |
|
|
$ |
— |
|
|
$ |
— |
|
|
2020 |
|
$ |
413 |
|
|
$ |
18 |
|
|
$ |
256 |
|
|
$ |
281 |
|
|
$ |
967 |
|
|
2019 |
|
$ |
484 |
|
|
$ |
626 |
|
|
$ |
663 |
|
|
$ |
582 |
|
|
$ |
2,355 |
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Tours (in thousands) |
2021 |
|
76 |
|
|
117 |
|
|
129 |
|
|
— |
|
|
— |
|
|||||
|
2020 |
|
162 |
|
|
6 |
|
|
80 |
|
|
85 |
|
|
333 |
|
|||||
|
2019 |
|
192 |
|
|
249 |
|
|
269 |
|
|
234 |
|
|
945 |
|
|||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
VPG |
2021 |
|
$ |
2,847 |
|
|
$ |
3,151 |
|
|
$ |
3,233 |
|
|
$ |
— |
|
|
$ |
— |
|
|
2020 |
|
$ |
2,128 |
|
|
NM |
|
|
$ |
3,039 |
|
|
$ |
2,938 |
|
|
$ |
2,486 |
|
|
|
2019 |
|
$ |
2,405 |
|
|
$ |
2,425 |
|
|
$ |
2,332 |
|
|
$ |
2,373 |
|
|
$ |
2,381 |
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Provision for Loan Losses (in millions) (b) |
2021 |
|
$ |
(38 |
) |
|
$ |
(33 |
) |
|
$ |
(49 |
) |
|
$ |
— |
|
|
$ |
— |
|
2020 |
|
$ |
(315 |
) |
|
$ |
(30 |
) |
|
$ |
(45 |
) |
|
$ |
(25 |
) |
|
$ |
(415 |
) |
|
|
2019 |
|
$ |
(109 |
) |
|
$ |
(129 |
) |
|
$ |
(135 |
) |
|
$ |
(106 |
) |
|
$ |
(479 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Provision for Loan Loss as a Percentage of Gross VOI Sales, net of Fee-for-Service sales |
2021 |
|
18.1 |
% |
|
10.1 |
%(c) |
|
12.4 |
%(d) |
|
— |
% |
|
— |
% |
|||||
2020 |
|
NM |
|
|
NM |
|
|
18.8 |
% |
|
9.5 |
%(e) |
|
NM |
|
||||||
2019 |
|
22.5 |
% |
|
21.2 |
% |
|
20.3 |
% |
|
18.6 |
% |
|
20.6 |
% |
||||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Allowance for Loan Losses (in millions) |
2021 |
|
$ |
622 |
|
|
$ |
573 |
|
|
$ |
565 |
|
|
$ |
— |
|
|
$ |
— |
|
2020 |
|
$ |
930 |
|
|
$ |
846 |
|
|
$ |
788 |
|
|
$ |
693 |
|
|
$ |
693 |
|
|
|
2019 |
|
$ |
721 |
|
|
$ |
735 |
|
|
$ |
767 |
|
|
$ |
747 |
|
|
$ |
747 |
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Gross Vacation Ownership Contract Receivables (in millions) |
2021 |
|
$ |
2,975 |
|
|
$ |
2,892 |
|
|
$ |
2,857 |
|
|
$ |
— |
|
|
$ |
— |
|
2020 |
|
$ |
3,722 |
|
|
$ |
3,461 |
|
|
$ |
3,309 |
|
|
$ |
3,175 |
|
|
$ |
3,175 |
|
|
2019 |
|
$ |
3,741 |
|
|
$ |
3,783 |
|
|
$ |
3,885 |
|
|
$ |
3,867 |
|
|
$ |
3,867 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Allowance for Loan Loss as a Percentage of Gross Vacation Ownership Contract Receivables |
2021 |
|
20.9 |
% |
|
19.8 |
% |
|
19.8 |
% |
|
— |
% |
|
— |
% |
|||||
2020 |
|
25.0 |
% |
|
24.4 |
% |
|
23.8 |
% |
|
21.8 |
% |
|
21.8 |
% |
||||||
2019 |
|
19.3 |
% |
|
19.4 |
% |
|
19.7 |
% |
|
19.3 |
% |
|
19.3 |
% |
||||||
Note: Full year amounts and percentages may not compute due to rounding. |
|
NM Defined as not meaningful. |
|
(a) |
Includes Gross VOI sales under the Company's fee-for-service sales. (See Table 6 for a reconciliation of Net VOI sales to Gross VOI sales). |
(b) |
Represents provision for estimated losses on vacation ownership contract receivables, which is recorded as contra revenue to vacation ownership interest sales on the Condensed Consolidated Statements of Income/(Loss). |
(c) |
The percentage was 18.0%, excluding the release of $26 million of the COVID-19 related provision during the period. |
(d) |
The percentage was 17.8%, excluding the release of $21 million of the COVID-19 related provision during the period. |
(e) |
The percentage was 17.3%, excluding the release of $20 million of the COVID-19 related provision during the period. |
Table 3 |
|||||||||||||||||||||
(continued) |
|||||||||||||||||||||
Travel + Leisure Co. Operating Statistics: Travel and Membership |
|||||||||||||||||||||
The following operating statistics are the significant drivers of the Company's revenues and therefore provide an enhanced understanding of the Company's businesses: (a) |
|||||||||||||||||||||
|
|||||||||||||||||||||
|
Year |
|
Q1 |
|
Q2 |
|
Q3 |
|
Q4 |
|
Full Year |
||||||||||
Transactions (in thousands) |
|
|
|
|
|
|
|
|
|
|
|
||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Exchange |
2021 |
|
354 |
|
|
314 |
|
|
256 |
|
|
— |
|
|
— |
|
|||||
Non-Exchange |
2021 |
|
159 |
|
|
210 |
|
|
214 |
|
|
— |
|
|
— |
|
|||||
Total Transactions |
2021 |
|
513 |
|
|
524 |
|
|
470 |
|
|
— |
|
|
— |
|
|||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Exchange |
2020 |
|
260 |
|
|
72 |
|
|
214 |
|
|
217 |
|
|
762 |
|
|||||
Non-Exchange |
2020 |
|
141 |
|
|
44 |
|
|
142 |
|
|
131 |
|
|
458 |
|
|||||
Total Transactions |
2020 |
|
401 |
|
|
116 |
|
|
356 |
|
|
348 |
|
|
1,220 |
|
|||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Exchange |
2019 |
|
444 |
|
|
377 |
|
|
367 |
|
|
304 |
|
|
1,493 |
|
|||||
Non-Exchange |
2019 |
|
52 |
|
|
63 |
|
|
138 |
|
|
153 |
|
|
405 |
|
|||||
Total Transactions |
2019 |
|
496 |
|
|
440 |
|
|
505 |
|
|
457 |
|
|
1,898 |
|
|||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Revenue per transaction (in dollars) |
|
|
|
|
|
|
|
|
|
|
|
||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Exchange |
2021 |
|
$ |
292 |
|
|
$ |
331 |
|
|
$ |
339 |
|
|
$ |
— |
|
|
$ |
— |
|
Non-Exchange |
2021 |
|
$ |
182 |
|
|
$ |
231 |
|
|
$ |
214 |
|
|
$ |
— |
|
|
$ |
— |
|
Total Revenue per transaction |
2021 |
|
$ |
258 |
|
|
$ |
291 |
|
|
$ |
282 |
|
|
$ |
— |
|
|
$ |
— |
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Exchange |
2020 |
|
$ |
279 |
|
|
$ |
540 |
|
|
$ |
300 |
|
|
$ |
330 |
|
|
$ |
324 |
|
Non-Exchange |
2020 |
|
$ |
164 |
|
|
$ |
133 |
|
|
$ |
157 |
|
|
$ |
128 |
|
|
$ |
148 |
|
Total Revenue per transaction |
2020 |
|
$ |
239 |
|
|
$ |
384 |
|
|
$ |
243 |
|
|
$ |
254 |
|
|
$ |
258 |
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Exchange |
2019 |
|
$ |
275 |
|
|
$ |
276 |
|
|
$ |
276 |
|
|
$ |
307 |
|
|
$ |
282 |
|
Non-Exchange |
2019 |
|
$ |
216 |
|
|
$ |
185 |
|
|
$ |
172 |
|
|
$ |
165 |
|
|
$ |
177 |
|
Total Revenue per transaction |
2019 |
|
$ |
269 |
|
|
$ |
263 |
|
|
$ |
247 |
|
|
$ |
259 |
|
|
$ |
259 |
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Avg. Number of Exchange Members (in thousands) |
2021 |
|
3,576 |
|
|
3,582 |
|
|
3,895 |
|
|
— |
|
|
— |
|
|||||
2020 |
|
3,864 |
|
|
3,799 |
|
|
3,680 |
|
|
3,652 |
|
|
3,749 |
|
||||||
2019 |
|
3,875 |
|
|
3,893 |
|
|
3,895 |
|
|
3,884 |
|
|
3,887 |
|
||||||
Note: Full year amounts may not compute due to rounding. |
|
(a) |
Includes the impact of acquisitions from the acquisition dates forward. |
Table 4 |
||||||||||||||||||||
Travel + Leisure Co. Revenue by Reportable Segment (in millions) |
||||||||||||||||||||
|
|
2021 |
||||||||||||||||||
|
|
Q1 |
|
Q2 |
|
Q3 |
|
Q4 |
|
Full Year |
||||||||||
Vacation Ownership |
|
|
|
|
|
|
|
|
|
|
||||||||||
Net VOI Sales |
|
$ |
172 |
|
|
$ |
294 |
|
|
$ |
344 |
|
|
$ |
— |
|
|
$ |
— |
|
Property Management Fees and Reimbursable Revenues |
|
157 |
|
|
161 |
|
|
171 |
|
|
— |
|
|
— |
|
|||||
Consumer Financing |
|
98 |
|
|
102 |
|
|
103 |
|
|
— |
|
|
— |
|
|||||
Other Revenues |
|
22 |
|
|
42 |
|
|
42 |
|
|
— |
|
|
— |
|
|||||
Total Vacation Ownership |
|
449 |
|
|
599 |
|
|
660 |
|
|
— |
|
|
— |
|
|||||
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Travel and Membership |
|
|
|
|
|
|
|
|
|
|
||||||||||
Transaction Revenues |
|
132 |
|
|
153 |
|
|
133 |
|
|
— |
|
|
— |
|
|||||
Subscription Revenues |
|
41 |
|
|
43 |
|
|
43 |
|
|
— |
|
|
— |
|
|||||
Other Revenues |
|
10 |
|
|
8 |
|
|
9 |
|
|
— |
|
|
— |
|
|||||
Total Travel and Membership |
|
183 |
|
|
204 |
|
|
185 |
|
|
— |
|
|
— |
|
|||||
Total Reportable Segments |
|
$ |
632 |
|
|
$ |
803 |
|
|
$ |
845 |
|
|
$ |
— |
|
|
$ |
— |
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
|
|
2020 |
||||||||||||||||||
|
|
Q1 |
|
Q2 |
|
Q3 |
|
Q4 |
|
Full Year |
||||||||||
Vacation Ownership |
|
|
|
|
|
|
|
|
|
|
||||||||||
Net VOI Sales |
|
$ |
90 |
|
|
$ |
(13 |
) |
|
$ |
196 |
|
|
$ |
231 |
|
|
$ |
505 |
|
Property Management Fees and Reimbursable Revenues |
|
170 |
|
|
122 |
|
|
146 |
|
|
145 |
|
|
583 |
|
|||||
Consumer Financing |
|
127 |
|
|
119 |
|
|
115 |
|
|
107 |
|
|
467 |
|
|||||
Other Revenues |
|
16 |
|
|
10 |
|
|
18 |
|
|
26 |
|
|
70 |
|
|||||
Total Vacation Ownership |
|
403 |
|
|
238 |
|
|
475 |
|
|
509 |
|
|
1,625 |
|
|||||
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Travel and Membership |
|
|
|
|
|
|
|
|
|
|
||||||||||
Transaction Revenues |
|
96 |
|
|
44 |
|
|
86 |
|
|
88 |
|
|
315 |
|
|||||
Subscription Revenues |
|
44 |
|
|
33 |
|
|
43 |
|
|
40 |
|
|
160 |
|
|||||
Other Revenues |
|
19 |
|
|
29 |
|
|
16 |
|
|
13 |
|
|
77 |
|
|||||
Total Travel and Membership |
|
159 |
|
|
106 |
|
|
145 |
|
|
141 |
|
|
552 |
|
|||||
Total Reportable Segments |
|
$ |
562 |
|
|
$ |
344 |
|
|
$ |
620 |
|
|
$ |
650 |
|
|
$ |
2,177 |
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
|
|
2019 |
||||||||||||||||||
|
|
Q1 |
|
Q2 |
|
Q3 |
|
Q4 |
|
Full Year |
||||||||||
Vacation Ownership |
|
|
|
|
|
|
|
|
|
|
||||||||||
Net VOI Sales |
|
$ |
375 |
|
|
$ |
481 |
|
|
$ |
528 |
|
|
$ |
464 |
|
|
$ |
1,848 |
|
Property Management Fees and Reimbursable Revenues |
|
163 |
|
|
162 |
|
|
170 |
|
|
176 |
|
|
672 |
|
|||||
Consumer Financing |
|
125 |
|
|
128 |
|
|
132 |
|
|
130 |
|
|
515 |
|
|||||
Other Revenues |
|
12 |
|
|
31 |
|
|
20 |
|
|
24 |
|
|
87 |
|
|||||
Total Vacation Ownership |
|
675 |
|
|
802 |
|
|
850 |
|
|
794 |
|
|
3,122 |
|
|||||
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Travel and Membership |
|
|
|
|
|
|
|
|
|
|
||||||||||
Transaction Revenues |
|
133 |
|
|
116 |
|
|
125 |
|
|
118 |
|
|
492 |
|
|||||
Subscription Revenues |
|
55 |
|
|
54 |
|
|
54 |
|
|
53 |
|
|
216 |
|
|||||
Vacation Rental Revenue |
|
38 |
|
|
48 |
|
|
60 |
|
|
7 |
|
|
153 |
|
|||||
Other Revenues |
|
22 |
|
|
24 |
|
|
24 |
|
|
14 |
|
|
83 |
|
|||||
Total Travel and Membership |
|
248 |
|
|
242 |
|
|
263 |
|
|
192 |
|
|
944 |
|
|||||
Total Reportable Segments |
|
$ |
923 |
|
|
$ |
1,044 |
|
|
$ |
1,113 |
|
|
$ |
986 |
|
|
$ |
4,066 |
|
Note: Full year amounts may not add across due to rounding. |
||||||||||||||||||||
Table 5 |
|||||||||||||||||||||
Travel + Leisure Co. Non-GAAP Measure: Reconciliation of Net Income/(Loss) to Adjusted Net Income/(Loss) to Adjusted EBITDA (in millions, except diluted per share amounts) |
|||||||||||||||||||||
|
Three Months Ended September 30, |
||||||||||||||||||||
|
2021 |
|
EPS |
|
Margin % |
|
2020 |
|
EPS |
|
Margin % |
||||||||||
Net income attributable to TNL shareholders |
$ |
101 |
|
|
$ |
1.15 |
|
|
12.0 |
% |
|
$ |
40 |
|
|
$ |
0.47 |
|
|
6.5 |
% |
Legacy items |
2 |
|
|
|
|
|
|
1 |
|
|
|
|
|
||||||||
Amortization of acquired intangibles (a) |
2 |
|
|
|
|
|
|
2 |
|
|
|
|
|
||||||||
COVID-19 related costs (b) |
1 |
|
|
|
|
|
|
13 |
|
|
|
|
|
||||||||
Exchange inventory write-off |
— |
|
|
|
|
|
|
10 |
|
|
|
|
|
||||||||
Impairments (c) |
— |
|
|
|
|
|
|
6 |
|
|
|
|
|
||||||||
Restructuring costs |
— |
|
|
|
|
|
|
2 |
|
|
|
|
|
||||||||
Taxes (d) |
(1 |
) |
|
|
|
|
|
(3 |
) |
|
|
|
|
||||||||
Adjusted net income from continuing operations |
$ |
104 |
|
|
$ |
1.19 |
|
|
12.4 |
% |
|
$ |
71 |
|
|
$ |
0.83 |
|
|
11.6 |
% |
Income taxes/(benefit) on adjusted net income |
41 |
|
|
|
|
|
|
(18 |
) |
|
|
|
|
||||||||
Interest expense |
47 |
|
|
|
|
|
|
52 |
|
|
|
|
|
||||||||
Depreciation |
29 |
|
|
|
|
|
|
30 |
|
|
|
|
|
||||||||
Stock-based compensation expense (e) |
8 |
|
|
|
|
|
|
6 |
|
|
|
|
|
||||||||
Interest income |
(1 |
) |
|
|
|
|
|
(2 |
) |
|
|
|
|
||||||||
Adjusted EBITDA |
$ |
228 |
|
|
|
|
27.2 |
% |
|
$ |
139 |
|
|
|
|
22.6 |
% |
||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Diluted Shares Outstanding |
87.4 |
|
|
|
|
|
|
86.1 |
|
|
|
|
|
||||||||
|
Nine Months Ended September 30, |
||||||||||||||||||||
|
2021 |
|
EPS |
|
Margin % |
|
2020 |
|
EPS |
|
Margin % |
||||||||||
Net income/(loss) attributable to TNL shareholders |
$ |
201 |
|
|
$ |
2.30 |
|
|
8.9 |
% |
|
$ |
(258 |
) |
|
$ |
(3.00 |
) |
|
(17.0 |
)% |
Loss on disposal of discontinued business, net of income taxes |
(2 |
) |
|
|
|
|
|
— |
|
|
|
|
|
||||||||
Net income/(loss) from continuing operations |
$ |
203 |
|
|
$ |
2.33 |
|
|
9.0 |
% |
|
$ |
(258 |
) |
|
$ |
(3.00 |
) |
|
(17.0 |
)% |
Amortization of acquired intangibles (a) |
7 |
|
|
|
|
|
|
7 |
|
|
|
|
|
||||||||
Legacy items |
6 |
|
|
|
|
|
|
2 |
|
|
|
|
|
||||||||
COVID-19 related costs (b) |
3 |
|
|
|
|
|
|
51 |
|
|
|
|
|
||||||||
Exchange inventory write-off |
— |
|
|
|
|
|
|
48 |
|
|
|
|
|
||||||||
Impairments (c) |
— |
|
|
|
|
|
|
54 |
|
|
|
|
|
||||||||
Restructuring costs |
(1 |
) |
|
|
|
|
|
27 |
|
|
|
|
|
||||||||
Taxes (d) |
(4 |
) |
|
|
|
|
|
(39 |
) |
|
|
|
|
||||||||
Adjusted net income/(loss) from continuing operations |
$ |
214 |
|
|
$ |
2.46 |
|
|
9.5 |
% |
|
$ |
(108 |
) |
|
$ |
(1.26 |
) |
|
(7.1 |
)% |
Income taxes/(benefit) on adjusted net income/(loss) |
80 |
|
|
|
|
|
|
(15 |
) |
|
|
|
|
||||||||
Interest expense |
147 |
|
|
|
|
|
|
138 |
|
|
|
|
|
||||||||
Depreciation |
86 |
|
|
|
|
|
|
87 |
|
|
|
|
|
||||||||
Stock-based compensation expense (e) |
24 |
|
|
|
|
|
|
14 |
|
|
|
|
|
||||||||
Interest income |
(1 |
) |
|
|
|
|
|
(5 |
) |
|
|
|
|
||||||||
Adjusted EBITDA |
$ |
550 |
|
|
|
|
24.3 |
% |
|
$ |
111 |
|
|
|
|
7.3 |
% |
||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Diluted Shares Outstanding |
87.3 |
|
|
|
|
|
|
86.1 |
|
|
|
|
|
||||||||
Amounts may not calculate due to rounding. The tables above reconcile certain non-GAAP financial measures to their closest GAAP measure. The presentation of these adjustments is intended to permit the comparison of particular adjustments as they appear in the income statement in order to assist investors' understanding of the overall impact of such adjustments. In addition to GAAP financial measures, the Company provides adjusted net income/(loss), adjusted EBITDA, adjusted EBITDA margin, and adjusted diluted EPS to assist our investors in evaluating our ongoing operating performance for the current reporting period and, where provided, over different reporting periods, by adjusting for certain items which in our view do not necessarily reflect ongoing performance. We also internally use these measures to assess our operating performance, both absolutely and in comparison to other companies, and in evaluating or making selected compensation decisions. These supplemental disclosures are in addition to GAAP reported measures. Non-GAAP measures should not be considered a substitute for, nor superior to, financial results and measures determined or calculated in accordance with GAAP. Our presentation of adjusted measures may not be comparable to similarly-titled measures used by other companies. See "Presentation of Financial Information" and table 9 for the definitions of these non-GAAP measures. |
|
(a) |
Amortization of acquisition-related intangible assets is excluded from adjusted net income/(loss) and adjusted EBITDA. |
(b) |
Reflects severance and other employee costs associated with layoffs due to the COVID-19 workforce reduction offset in part by employee retention credits received in connection with the U.S. CARES Act, ARPA and similar international programs for wages paid to certain employees despite having operations suspended. This amount does not include costs associated with idle pay. |
(c) |
Includes $5 million of bad debt expense related to a note receivable for the nine months ended September 30, 2020, included in Operating expenses on the Condensed Consolidated Statements of Income/(Loss). |
(d) |
The amounts represent the tax effects on the adjustments. In addition, during the three and nine months ended September 30, 2020, the amounts are partially offset by $6 million of non-cash tax expense associated with COVID-19 related increases to valuation allowances. |
(e) |
All stock-based compensation is excluded from adjusted EBITDA. |
Table 6 |
||||||||||||||||||||
Travel + Leisure Co. Non-GAAP Measure: Reconciliation of Net VOI Sales to Gross VOI Sales (in millions) |
||||||||||||||||||||
The Company believes gross VOI sales provide an enhanced understanding of the performance of its vacation ownership business because it directly measures the sales volume of this business during a given reporting period. |
||||||||||||||||||||
The following table provides a reconciliation of Net VOI sales (see Table 4) to Gross VOI sales (see Table 3): |
||||||||||||||||||||
Year |
|
|
|
|
|
|
|
|
|
|
||||||||||
2021 |
|
Q1 |
|
Q2 |
|
Q3 |
|
Q4 |
|
Full Year |
||||||||||
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Net VOI sales |
|
$ |
172 |
|
|
$ |
294 |
|
|
$ |
344 |
|
|
$ |
— |
|
|
$ |
— |
|
Loan loss provision |
|
38 |
|
|
33 |
|
|
49 |
|
|
— |
|
|
— |
|
|||||
Gross VOI sales, net of Fee-for-Service sales |
|
210 |
|
|
327 |
|
|
393 |
|
|
— |
|
|
— |
|
|||||
Fee-for-Service sales |
|
26 |
|
|
56 |
|
|
47 |
|
|
— |
|
|
— |
|
|||||
Gross VOI sales |
|
$ |
236 |
|
|
$ |
383 |
|
|
$ |
440 |
|
|
$ |
— |
|
|
$ |
— |
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
2020 |
|
|
|
|
|
|
||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Net VOI sales |
|
$ |
90 |
|
|
$ |
(13 |
) |
|
$ |
196 |
|
|
$ |
231 |
|
|
$ |
505 |
|
Loan loss provision |
|
315 |
|
|
30 |
|
|
45 |
|
|
25 |
|
|
415 |
|
|||||
Gross VOI sales, net of Fee-for-Service sales |
|
405 |
|
|
17 |
|
|
241 |
|
|
256 |
|
|
920 |
|
|||||
Fee-for-Service sales |
|
8 |
|
|
1 |
|
|
15 |
|
|
25 |
|
|
47 |
|
|||||
Gross VOI sales |
|
$ |
413 |
|
|
$ |
18 |
|
|
$ |
256 |
|
|
$ |
281 |
|
|
$ |
967 |
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
2019 |
|
|
|
|
|
|
|
|
|
|
||||||||||
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Net VOI sales |
|
$ |
375 |
|
|
$ |
481 |
|
|
$ |
528 |
|
|
$ |
464 |
|
|
$ |
1,848 |
|
Loan loss provision |
|
109 |
|
|
129 |
|
|
135 |
|
|
106 |
|
|
479 |
|
|||||
Gross VOI sales, net of Fee-for-Service sales |
|
484 |
|
|
610 |
|
|
663 |
|
|
570 |
|
|
2,327 |
|
|||||
Fee-for-Service sales |
|
— |
|
|
16 |
|
|
— |
|
|
12 |
|
|
28 |
|
|||||
Gross VOI sales |
|
$ |
484 |
|
|
$ |
626 |
|
|
$ |
663 |
|
|
$ |
582 |
|
|
$ |
2,355 |
|
Note: Amounts may not add due to rounding. |
||||||||||||||||||||
Table 7 |
||||||||
Travel + Leisure Co. Non-GAAP Measure: Reconciliation of Net Cash Provided by Operating Activities to Adjusted Free Cash Flow (in millions) |
||||||||
|
|
Nine Months Ended September 30, |
||||||
|
|
2021 |
|
2020 |
||||
|
|
|
|
|
||||
Net cash provided by operating activities |
|
$ |
435 |
|
|
$ |
224 |
|
Property and equipment additions |
|
(40 |
) |
|
(56 |
) |
||
Sum of proceeds and principal payments of non-recourse vacation ownership debt |
|
(272 |
) |
|
(94 |
) |
||
Free cash flow |
|
$ |
123 |
|
|
$ |
74 |
|
Separation and other adjustments (a) |
|
— |
|
|
14 |
|
||
COVID-19 related adjustments (b) |
|
5 |
|
|
32 |
|
||
Adjusted free cash flow (c) |
|
$ |
128 |
|
|
$ |
120 |
|
(a) |
Includes cash paid for separation-related activities and transaction costs for acquisitions and divestitures. |
(b) |
Includes cash paid for COVID-19 expenses factored into the calculation of Adjusted EBITDA. |
(c) |
The Company had $77 million of net cash used in investing activities and $1.2 billion of net cash used in financing activities for the nine months ended September 30, 2021, and $98 million of net cash used in investing activities and $775 million of net cash provided by financing activities for the nine months ended September 30, 2020. |
Table 8 |
||||||||||||||||||||||
Travel + Leisure Co. COVID-19 Impacts (in millions) |
||||||||||||||||||||||
The tables below present the COVID-19 related impacts to our results of operations for the three and nine months ended September 30, 2021, and the related classification on the Condensed Consolidated Statements of Income/(Loss): |
||||||||||||||||||||||
Three Months Ended |
|
Vacation Ownership |
|
Travel and Membership |
|
Corporate & Other |
|
Consolidated |
|
Non-GAAP Adjustments |
|
Income Statement Classification |
||||||||||
September 30, 2021 |
|
|
|
|
|
|
||||||||||||||||
Allowance for loan losses: |
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Provision |
|
$ |
(21 |
) |
|
$ |
— |
|
|
$ |
— |
|
|
$ |
(21 |
) |
|
$ |
— |
|
|
Vacation ownership interest sales |
Recoveries |
|
8 |
|
|
— |
|
|
— |
|
|
8 |
|
|
— |
|
|
Cost/(recovery) of vacation ownership interests |
|||||
Employee compensation related and other |
|
1 |
|
|
— |
|
|
— |
|
|
1 |
|
|
1 |
|
|
COVID-19 related costs |
|||||
Total COVID-19 |
|
$ |
(12 |
) |
|
$ |
— |
|
|
$ |
— |
|
|
$ |
(12 |
) |
|
$ |
1 |
|
|
|
Nine Months Ended |
|
Vacation Ownership |
|
Travel and Membership |
|
Corporate & Other |
|
Consolidated |
|
Non-GAAP Adjustments |
|
Income Statement Classification |
||||||||||
September 30, 2021 |
|
|
|
|
|
|
||||||||||||||||
Allowance for loan losses: |
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Provision |
|
$ |
(47 |
) |
|
$ |
— |
|
|
$ |
— |
|
|
$ |
(47 |
) |
|
$ |
— |
|
|
Vacation ownership interest sales |
Recoveries |
|
17 |
|
|
— |
|
|
— |
|
|
17 |
|
|
— |
|
|
Cost/(recovery) of vacation ownership interests |
|||||
Employee compensation related and other |
|
2 |
|
|
— |
|
|
1 |
|
|
3 |
|
|
3 |
|
|
COVID-19 related costs |
|||||
Lease related |
|
(1 |
) |
|
— |
|
|
— |
|
|
(1 |
) |
|
(1 |
) |
|
Restructuring |
|||||
Total COVID-19 |
|
$ |
(29 |
) |
|
$ |
— |
|
|
$ |
1 |
|
|
$ |
(28 |
) |
|
$ |
2 |
|
|
|
The tables below present the COVID-19 related impacts to our results of operations for the three and nine months ended September 30, 2020, and the related classification on the Condensed Consolidated Statements of Income/(Loss): |
||||||||||||||||||||||
Three Months Ended |
|
Vacation Ownership |
|
Travel and Membership |
|
Corporate & Other |
|
Consolidated |
|
Non-GAAP Adjustments |
|
Income Statement Classification |
||||||||||
September 30, 2020 |
|
|
|
|
|
|
||||||||||||||||
Employee compensation related and other |
|
$ |
11 |
|
|
$ |
1 |
|
|
$ |
2 |
|
|
$ |
14 |
|
|
$ |
13 |
|
|
COVID-19 related costs |
Exchange inventory write-off |
|
— |
|
|
10 |
|
|
— |
|
|
10 |
|
|
10 |
|
|
Operating expenses |
|||||
Asset impairment |
|
6 |
|
|
— |
|
|
— |
|
|
6 |
|
|
6 |
|
|
Asset impairments |
|||||
Lease related |
|
1 |
|
|
— |
|
|
— |
|
|
1 |
|
|
1 |
|
|
Restructuring |
|||||
Total COVID-19 |
|
$ |
18 |
|
|
$ |
11 |
|
|
$ |
2 |
|
|
$ |
31 |
|
|
$ |
30 |
|
|
|
Nine Months Ended |
|
Vacation Ownership |
|
Travel and Membership |
|
Corporate & Other |
|
Consolidated |
|
Non-GAAP Adjustments |
|
Income Statement Classification |
||||||||||
September 30, 2020 |
|
|
|
|
|
|
||||||||||||||||
Allowance for loan losses: |
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Provision |
|
$ |
225 |
|
|
$ |
— |
|
|
$ |
— |
|
|
$ |
225 |
|
|
$ |
— |
|
|
Vacation ownership interest sales |
Recoveries |
|
(55 |
) |
|
— |
|
|
— |
|
|
(55 |
) |
|
— |
|
|
Cost/(recovery) of vacation ownership interests |
|||||
Employee compensation related and other |
|
62 |
|
|
6 |
|
|
13 |
|
|
81 |
|
|
51 |
|
|
COVID-19 related costs |
|||||
Asset impairment |
|
20 |
|
|
34 |
|
|
— |
|
|
54 |
|
|
54 |
|
|
Asset impairments / Operating expenses |
|||||
Exchange inventory write-off |
|
— |
|
|
48 |
|
|
— |
|
|
48 |
|
|
48 |
|
|
Operating expenses |
|||||
Lease related |
|
2 |
|
|
22 |
|
|
— |
|
|
24 |
|
|
24 |
|
|
Restructuring |
|||||
Total COVID-19 |
|
$ |
254 |
|
|
$ |
110 |
|
|
$ |
13 |
|
|
$ |
377 |
|
|
$ |
177 |
|
|
|
Definitions
Adjusted Diluted Earnings/(Loss) per Share: A non-GAAP measure, defined by the Company as Adjusted net income/(loss) from continuing operations divided by the diluted weighted average number of common shares.
Adjusted EBITDA: A non-GAAP measure, defined by the Company as net income/(loss) from continuing operations before depreciation and amortization, interest expense (excluding consumer financing interest), early extinguishment of debt, interest income (excluding consumer financing revenues) and income taxes, each of which is presented on the Condensed Consolidated Statements of Income. Adjusted EBITDA also excludes stock-based compensation costs, separation and restructuring costs, legacy items, transaction costs for acquisitions and divestitures, impairments, gains and losses on sale/disposition of business, and items that meet the conditions of unusual and/or infrequent. Legacy items include the resolution of and adjustments to certain contingent liabilities related to acquisitions of continuing businesses and dispositions, including the separation of Wyndham Hotels and Cendant, and the sale of the vacation rentals businesses. We believe that when considered with GAAP measures, Adjusted EBITDA is useful to assist our investors in evaluating our ongoing operating performance for the current reporting period and, where provided, over different reporting periods. We also internally use these measures to assess our operating performance, both absolutely and in comparison to other companies, and in evaluating or making selected compensation decisions. Adjusted EBITDA should not be considered in isolation or as a substitute for net income/(loss) or other income statement data prepared in accordance with GAAP and our presentation of Adjusted EBITDA may not be comparable to similarly-titled measures used by other companies.
Adjusted EBITDA Margin: A non-GAAP measure, represents Adjusted EBITDA as a percentage of revenue.
Adjusted Free Cash Flow: A non-GAAP measure, defined by the Company as net cash provided by operating activities from continuing operations less property and equipment additions (capital expenditures) plus the sum of proceeds and principal payments of non-recourse vacation ownership debt, while also adding back cash paid for transaction costs for acquisitions and divestitures, separation adjustments associated with the spin-off of Wyndham Hotels, and certain adjustments related to COVID-19. A limitation of using Adjusted free cash flow versus the GAAP measure of net cash provided by operating activities as a means for evaluating TNL is that Adjusted free cash flow does not represent the total cash movement for the period as detailed in the consolidated statement of cash flows.
Adjusted Net Income/(Loss): A non-GAAP measure, defined by the Company as net income/(loss) from continuing operations adjusted to exclude separation and restructuring costs, legacy items, transaction costs for acquisitions and divestitures, amortization of acquisition-related assets, debt modification costs, impairments, gains and losses on sale/disposition of business, and items that meet the conditions of unusual and/or infrequent and the tax effect of such adjustments. Legacy items include the resolution of and adjustments to certain contingent liabilities related to acquisitions of continuing businesses and dispositions, including the separation of Wyndham Hotels and Cendant, and the sale of the vacation rentals businesses.
Average Number of Exchange Members: Represents paid members in our vacation exchange programs who are current on their annual membership dues or within the allowed grace period.
Free Cash Flow (FCF): A non-GAAP measure, defined by TNL as net cash provided by operating activities from continuing operations less property and equipment additions (capital expenditures) plus the sum of proceeds and principal payments of non-recourse vacation ownership debt. TNL believes FCF to be a useful operating performance measure to evaluate the ability of its operations to generate cash for uses other than capital expenditures and, after debt service and other obligations, its ability to grow its business through acquisitions and equity investments, as well as its ability to return cash to shareholders through dividends and share repurchases. A limitation of using FCF versus the GAAP measure of net cash provided by operating activities as a means for evaluating TNL is that FCF does not represent the total cash movement for the period as detailed in the consolidated statement of cash flows.
Gross Vacation Ownership Interest Sales: A non-GAAP measure, represents sales of vacation ownership interests (VOIs), including sales under the fee-for-service program before the effect of loan loss provisions. We believe that Gross VOI sales provide an enhanced understanding of the performance of our vacation ownership business because it directly measures the sales volume of this business during a given reporting period.
Leverage Ratio: The Company calculates leverage ratio as net debt divided by Adjusted EBITDA as defined in the credit agreement.
Net Debt: Net debt equals total debt outstanding, less non-recourse vacation ownership debt and cash and cash equivalents.
New owner sales, volume mix: Represents VOI sales (tour generated plus telephonic) to first time buyers as a percentage of total VOI sales.
New owner sales, transactions mix: Represents the number of first time buyer transactions as a percentage of the total number of VOIs sold during the period.
Tours: Represents the number of tours taken by guests in our efforts to sell VOIs.
Travel and Membership Revenue per Transaction: Represents transactional revenue divided by transactions, provided in two categories; Exchange, which is primarily RCI, and non-Exchange.
Travel and Membership Transactions: Represents the number of vacation bookings recognized as revenue during the period, net of cancellations, provided in two categories; Exchange, which is primarily RCI, and non-Exchange.
Volume Per Guest (VPG): Represents Gross VOI sales (excluding tele-sales upgrades, which are non-tour upgrade sales) divided by the number of tours. The Company has excluded non-tour upgrade sales in the calculation of VPG because non-tour upgrade sales are generated by a different marketing channel.
View source version on businesswire.com: https://www.businesswire.com/news/home/20211027005279/en/
Contacts
Investors:
Christopher Agnew
Senior Vice President, FP&A and Investor Relations
(407) 626-4050
Christopher.Agnew@travelandleisure.com
Media:
Steven Goldsmith
Corporate Communications
(407) 626-5882
Steven.Goldsmith@travelandleisure.com
