VAC Marriott Vacations Worldwide Corporation

Marriott Vacations Worldwide Corporation (NYSE: VAC) (“MVW,” the “Company,” “we” or “our”) reported financial results for the fourth quarter and full year 2024 and provided guidance for full year 2025.

Fourth Quarter 2024 Highlights Consolidated Vacation Ownership contract sales increased 7% compared to the fourth quarter of 2024 to $477 million, including 9% first time buyer contract sales growth.

• Net income attributable to common stockholders was $50 million and diluted earnings per share was $1.30.
• Adjusted net income attributable to common stockholders was $73 million and adjusted diluted earnings per share was $1.86.
• Adjusted EBITDA was $185 million.
• Full year cash provided by operating activities was $205 million and Adjusted Free Cash Flow was $278 million.
• The Company provides full year 2025 guidance.

“We had a strong end of the year, reflecting the resilience of our leisure-focused business model and the success of the initiatives we launched last year, with contract sales growing 7% year-over-year in the fourth quarter,” said John Geller, president and chief executive officer. “Looking forward, we believe we have substantial opportunities to accelerate revenue growth, reduce costs and enhance operational efficiencies, and expect to generate $150 million to $200 million in run-rate benefits from these initiatives by the end of 2026, with half coming from cost savings and efficiencies and the balance from accelerating revenue growth. We will also continue to focus on delivering the experiences our owners, members, and guests expect of us, which is the most important thing we can do as an organization.”

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.

Vacation Ownership

 

Three Months Ended

 

 

 

(In millions, except volume per guest (“VPG”) and tours)

December 31, 2024

 

December 31, 2023

 

Change

 

Revenues excluding cost reimbursements

$

817

 

 

$

728

 

 

12%

 

Total consolidated contract sales

$

477

 

 

$

447

 

 

7%

 

VPG

$

3,916

 

 

$

4,002

 

 

(2%)

 

Tours

 

113,828

 

 

 

105,580

 

 

8%

 

Segment financial results attributable to common stockholders

$

172

 

 

$

199

 

 

(14%)

 

Segment margin

21.0%

27.3%

(630 bps)

Segment Adjusted EBITDA*

$

221

 

 

$

236

 

 

(7%)

 

Segment Adjusted EBITDA margin*

27.0%

 

32.5%

 

(550 bps)

 

Consolidated contract sales increased year-over-year driven by higher tours. Segment Adjusted EBITDA decreased compared to the prior year driven by lower development and financing profit, partially offset by higher rental and management and exchange profit.

Exchange & Third-Party Management

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

Three Months Ended

 

 

 

December 31, 2024

 

December 31, 2023

 

Change

 

Revenues excluding cost reimbursements

$

49

 

 

$

58

 

 

(13%)

 

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

 

1,546

 

 

 

1,564

 

 

(1%)

 

Average revenue per Interval International member

$

35.36

 

 

$

36.16

 

 

(2%)

 

Segment financial results attributable to common stockholders

$

14

 

 

$

18

 

 

(26%)

 

Segment margin

26.5%

31.1%

(460 bps)

Segment Adjusted EBITDA*

$

22

 

 

$

31

 

 

(27%)

 

Segment Adjusted EBITDA margin*

44.2%

 

52.2%

 

(800 bps)

 

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

Revenues excluding cost reimbursements and Segment Adjusted EBITDA decreased year-over-year due to lower exchange revenue at Interval International and reduced management fees at Aqua-Aston due to weakened demand in Maui.

Corporate and Other General and administrative costs decreased $20 million in the fourth quarter of 2024 compared to the prior year driven largely by lower project and IT spending.

Balance Sheet and Liquidity The Company ended the year with $914 million in liquidity, including $197 million of cash and cash equivalents and $607 million of available capacity under its revolving corporate credit facility. The Company also had more than $1 billion of total inventory at the end of the quarter, including $271 million classified as a component of Property and equipment.

The Company had $3.1 billion of corporate debt and $2.1 billion of non-recourse debt related to its securitized vacation ownership notes receivable at the end of 2024.

Full Year 2025 Outlook The Company is providing guidance for the full year 2025 as reflected in the chart below.

(in millions, except per share amounts)

2025 Guidance

Contract sales

$1,850

to

$1,925

Adjusted EBITDA*

$750

to

$780

Adjusted net income attributable to common stockholders

$250

to

$280

Adjusted earnings per share - diluted*

$6.30

to

$7.00

Adjusted free cash flow*

$290

to

$350

The guidance provided above excludes impacts from asset sales, foreign currency changes, restructuring costs, litigation charges, strategic modernization initiative costs, transaction and integration costs, and impairments, each of which the Company cannot forecast with sufficient accuracy to factor them into the guidance provided above and without unreasonable efforts, and which may be significant. As a result, the full year 2025 outlook is presented only on a non-GAAP basis and is not reconciled to the most comparable GAAP measures. Where one or more of the currently unavailable items is applicable, some items could be material, individually or in the aggregate, to GAAP reported results.

The Company’s 2025 guidance is based on the following supplemental estimates:

($ in millions)

2025 Guidance

Interest expense, net

$173

to

$168

Depreciation and amortization

$150

to

$148

Tax rate used to calculate net income attributable to common stockholders

36%

to

34%

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 2024 Financial Results Conference Call The Company will hold a conference call on February 27, 2025 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.

The Company routinely posts important information, including news releases, announcements and other statements about its business and results of operations, that may be deemed material to investors on the Investor Relations section of the Company’s website, www.marriottvacationsworldwide.com. The Company uses its website as a means of disclosing material, nonpublic information and for complying with the Company’s disclosure obligations under Regulation FD. Investors should monitor the Investor Relations section of the Company’s website in addition to following the Company’s press releases, filings with the SEC, public conference calls and webcasts.

Note on Forward-Looking Statements This press release and the accompanying schedules contain “forward-looking statements” within the meaning of federal securities laws, including statements about opportunities for accelerated growth, enhanced operational efficiencies and cost savings, expected annualized benefits of the Company's initiatives that the Company expects to realize by the end of 2026, full year 2025 outlook for contract sales, results of operations and cash flows, and the Company's continued focus on delivering experiences to owners, members and guests. 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; the ability to use Artificial intelligence (“AI”) technologies successfully and potential business, compliance, or reputational risks associated with the use of AI technologies; changes in privacy laws; the impact of a future banking crisis; impacts from natural or man-made disasters and wildfires, including the Maui and Los Angeles area wildfires; delinquency and default rates; 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 and accelerate growth and profitability; 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, 2024

 

TABLE OF CONTENTS

 

Summary Financial Information and Adjusted EBITDA by Segment

A-1

Consolidated Statements of Income

A-2

Revenues and Profit by Segment

A-3

to

A-4

Consolidated Contract Sales to Adjusted Development Profit

A-5

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

A-6

Adjusted EBITDA

A-7

Segment Adjusted EBITDA

 

Vacation Ownership

A-8

Exchange & Third-Party Management

Cash Flow and Adjusted Free Cash Flow

Balance Sheet Items

A-9

2025 Outlook - Adjusted Free Cash Flow

A-10

Quarterly Operating Metrics

A-11

Non-GAAP Financial Measures

A-12

A-1

 

MARRIOTT VACATIONS WORLDWIDE CORPORATION

SUMMARY FINANCIAL INFORMATION

(In millions, except per share amounts)

(Unaudited)

 

 

Three Months Ended

 

Change

 

Fiscal Year Ended

 

Change

 

December 31, 2024

 

December 31, 2023

 

 

December 31, 2024

 

December 31, 2023

 

GAAP Measures

 

 

 

 

 

 

 

 

 

 

 

Revenues

$

1,327

 

$

1,194

 

11%

 

$

4,967

 

$

4,727

 

5%

Income before income taxes and noncontrolling interests

$

59

 

$

64

 

(9%)

 

$

306

 

$

398

 

(23%)

Net income attributable to common stockholders

$

50

 

$

35

 

44%

 

$

218

 

$

254

 

(14%)

Diluted shares

 

42.1

 

 

42.5

 

(1%)

 

 

42.1

 

 

43.5

 

(3%)

Earnings per share - diluted

$

1.30

 

$

0.93

 

40%

 

$

5.61

 

$

6.28

 

(11%)

 

 

 

 

 

 

 

 

 

 

 

 

Non-GAAP Measures*

 

 

 

 

 

 

 

 

 

 

 

Adjusted EBITDA

$

185

 

$

186

 

(1%)

 

$

727

 

$

761

 

(4%)

Adjusted pretax income

$

100

 

$

105

 

(5%)

 

$

386

 

$

450

 

(14%)

Adjusted net income attributable to common stockholders

$

73

 

$

75

 

(2%)

 

$

258

 

$

322

 

(20%)

Adjusted earnings per share - diluted

$

1.86

 

$

1.88

 

(1%)

 

$

6.56

 

$

7.83

 

(16%)

 

 

 

 

 

 

 

 

 

 

 

 

* 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.

ADJUSTED EBITDA BY SEGMENT

(In millions)

(Unaudited)

 

 

Three Months Ended

 

Change

 

Fiscal Year Ended

 

Change

 

December 31, 2024

 

December 31, 2023

 

 

December 31, 2024

 

December 31, 2023

 

Vacation Ownership

$

221

 

 

$

236

 

 

(7%)

 

$

845

 

 

$

883

 

 

(4%)

Exchange & Third-Party Management

 

22

 

 

 

31

 

 

(27%)

 

 

102

 

 

 

130

 

 

(21%)

Segment Adjusted EBITDA*

 

243

 

 

 

267

 

 

(9%)

 

 

947

 

 

 

1,013

 

 

(6%)

General and administrative

 

(64

)

 

 

(84

)

 

23%

 

 

(243

)

 

 

(273

)

 

11%

Other

 

6

 

 

 

3

 

 

72%

 

 

23

 

 

 

21

 

 

6%

Adjusted EBITDA*

$

185

 

 

$

186

 

 

(1%)

 

$

727

 

 

$

761

 

 

(4%)

 

 

 

 

 

 

 

 

 

 

 

 

* 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

CONSOLIDATED STATEMENTS OF INCOME

(In millions, except per share amounts)

 

 

Three Months Ended

 

Fiscal Year Ended

 

December 31, 2024

 

December 31, 2023

 

December 31, 2024

 

December 31, 2023

REVENUES

 

 

 

 

 

 

 

Sale of vacation ownership products

$

400

 

 

$

375

 

 

$

1,448

 

 

$

1,460

 

Management and exchange

 

210

 

 

 

202

 

 

 

843

 

 

 

813

 

Rental

 

183

 

 

 

136

 

 

 

645

 

 

 

571

 

Financing

 

87

 

 

 

83

 

 

 

342

 

 

 

322

 

Cost reimbursements

 

447

 

 

 

398

 

 

 

1,689

 

 

 

1,561

 

TOTAL REVENUES

 

1,327

 

 

 

1,194

 

 

 

4,967

 

 

 

4,727

 

EXPENSES

 

 

 

 

 

 

 

Cost of vacation ownership products

 

55

 

 

 

50

 

 

 

200

 

 

 

224

 

Marketing and sales

 

242

 

 

 

205

 

 

 

919

 

 

 

823

 

Management and exchange

 

124

 

 

 

110

 

 

 

482

 

 

 

442

 

Rental

 

150

 

 

 

108

 

 

 

481

 

 

 

452

 

Financing

 

40

 

 

 

32

 

 

 

146

 

 

 

113

 

General and administrative

 

64

 

 

 

84

 

 

 

243

 

 

 

273

 

Depreciation and amortization

 

37

 

 

 

36

 

 

 

146

 

 

 

135

 

Litigation charges

 

2

 

 

 

6

 

 

 

17

 

 

 

13

 

Restructuring

 

6

 

 

 

6

 

 

 

10

 

 

 

6

 

Royalty fee

 

29

 

 

 

29

 

 

 

114

 

 

 

117

 

Impairment

 

28

 

 

 

28

 

 

 

30

 

 

 

32

 

Cost reimbursements

 

447

 

 

 

398

 

 

 

1,689

 

 

 

1,561

 

TOTAL EXPENSES

 

1,224

 

 

 

1,092

 

 

 

4,477

 

 

 

4,191

 

(Losses) gains and other (expense) income, net

 

(3

)

 

 

13

 

 

 

(1

)

 

 

47

 

Interest expense, net

 

(39

)

 

 

(39

)

 

 

(162

)

 

 

(145

)

Transaction and integration costs

 

—

 

 

 

(9

)

 

 

(18

)

 

 

(37

)

Other

 

(2

)

 

 

(3

)

 

 

(3

)

 

 

(3

)

INCOME BEFORE INCOME TAXES AND NONCONTROLLING INTERESTS

 

59

 

 

 

64

 

 

 

306

 

 

 

398

 

Provision for income taxes

 

(10

)

 

 

(31

)

 

 

(89

)

 

 

(146

)

NET INCOME

 

49

 

 

 

33

 

 

 

217

 

 

 

252

 

Net loss attributable to noncontrolling interests

 

1

 

 

 

2

 

 

 

1

 

 

 

2

 

NET INCOME ATTRIBUTABLE TO COMMON STOCKHOLDERS

$

50

 

 

$

35

 

 

$

218

 

 

$

254

 

 

 

 

 

 

 

 

 

EARNINGS PER SHARE ATTRIBUTABLE TO COMMON STOCKHOLDERS

 

 

 

 

 

 

 

Basic shares

 

35.2

 

 

 

35.6

 

 

 

35.4

 

 

 

36.5

 

Basic

$

1.42

 

 

$

0.98

 

 

$

6.16

 

 

$

6.96

 

Diluted shares

 

42.1

 

 

 

42.5

 

 

 

42.1

 

 

 

43.5

 

Diluted

$

1.30

 

 

$

0.93

 

 

$

5.61

 

 

$

6.28

 

A-3

 

MARRIOTT VACATIONS WORLDWIDE CORPORATION

REVENUES AND PROFIT BY SEGMENT

for the three months ended December 31, 2024

(In millions)

 

 

Reportable Segment

 

Corporate and Other

 

Total

 

Vacation Ownership

 

Exchange & Third-Party Management

 

 

REVENUES

 

 

 

 

 

 

 

Sales of vacation ownership products

$

400

 

 

$

—

 

 

$

—

 

 

$

400

 

Management and exchange(1)

 

 

 

 

 

 

 

Ancillary

 

63

 

 

 

1

 

 

 

—

 

 

 

64

 

Management fee

 

52

 

 

 

2

 

 

 

(2

)

 

 

52

 

Exchange and other services

 

40

 

 

 

38

 

 

 

16

 

 

 

94

 

Management and exchange

 

155

 

 

 

41

 

 

 

14

 

 

 

210

 

Rental

 

175

 

 

 

8

 

 

 

—

 

 

 

183

 

Financing

 

87

 

 

 

—

 

 

 

—

 

 

 

87

 

Cost reimbursements(1)

 

455

 

 

 

3

 

 

 

(11

)

 

 

447

 

TOTAL REVENUES

$

1,272

 

 

$

52

 

 

$

3

 

 

$

1,327

 

 

 

 

 

 

 

 

 

PROFIT

 

 

 

 

 

 

 

Development

$

103

 

 

$

—

 

 

$

—

 

 

$

103

 

Management and exchange(1)

 

78

 

 

 

14

 

 

 

(6

)

 

 

86

 

Rental(1)

 

20

 

 

 

8

 

 

 

5

 

 

 

33

 

Financing

 

47

 

 

 

—

 

 

 

—

 

 

 

47

 

TOTAL PROFIT

 

248

 

 

 

22

 

 

 

(1

)

 

 

269

 

 

 

 

 

 

 

 

 

OTHER

 

 

 

 

 

 

 

General and administrative

 

—

 

 

 

—

 

 

 

(64

)

 

 

(64

)

Depreciation and amortization

 

(25

)

 

 

(7

)

 

 

(5

)

 

 

(37

)

Litigation charges

 

(3

)

 

 

—

 

 

 

1

 

 

 

(2

)

Restructuring

 

—

 

 

 

—

 

 

 

(6

)

 

 

(6

)

Royalty fee

 

(29

)

 

 

—

 

 

 

—

 

 

 

(29

)

Impairment

 

(28

)

 

 

—

 

 

 

—

 

 

 

(28

)

Gains (losses) and other income (expense), net

 

11

 

 

 

(1

)

 

 

(13

)

 

 

(3

)

Interest expense, net

 

—

 

 

 

—

 

 

 

(39

)

 

 

(39

)

Other

 

(2

)

 

 

—

 

 

 

—

 

 

 

(2

)

INCOME (LOSS) BEFORE INCOME TAXES AND NONCONTROLLING INTERESTS

 

172

 

 

 

14

 

 

 

(127

)

 

 

59

 

Provision for income taxes

 

—

 

 

 

—

 

 

 

(10

)

 

 

(10

)

NET INCOME (LOSS)

 

172

 

 

 

14

 

 

 

(137

)

 

 

49

 

Net loss attributable to noncontrolling interests(1)

 

—

 

 

 

—

 

 

 

1

 

 

 

1

 

NET INCOME (LOSS) ATTRIBUTABLE TO COMMON STOCKHOLDERS

$

172

 

 

$

14

 

 

$

(136

)

 

$

50

 

SEGMENT MARGIN(2)

21.0%

 

26.5%

 

 

 

 

 

 

 

 

 

 

 

 

(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-4

 

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 loss attributable to noncontrolling interests(1)

 

—

 

 

 

—

 

 

 

2

 

 

 

2

 

NET INCOME (LOSS) ATTRIBUTABLE TO COMMON STOCKHOLDERS

$

199

 

 

$

18

 

 

$

(182

)

 

$

35

 

SEGMENT MARGIN(2)

27.3%

 

31.1%

 

 

 

 

 

 

 

 

 

 

 

 

(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-5

 

MARRIOTT VACATIONS WORLDWIDE CORPORATION

CONSOLIDATED CONTRACT SALES TO ADJUSTED DEVELOPMENT PROFIT

(In millions)

(Unaudited)

 

 

Three Months Ended

 

Fiscal Year Ended

 

December 31, 2024

 

December 31, 2023

 

December 31, 2024

 

December 31, 2023

Consolidated contract sales

$

477

 

 

$

447

 

 

$

1,813

 

 

$

1,772

 

Less resales contract sales

 

(9

)

 

 

(10

)

 

 

(38

)

 

 

(42

)

Consolidated contract sales, net of resales

 

468

 

 

 

437

 

 

 

1,775

 

 

 

1,730

 

Plus:

 

 

 

 

 

 

 

Settlement revenue

 

11

 

 

 

10

 

 

 

38

 

 

 

39

 

Resales revenue

 

3

 

 

 

4

 

 

 

19

 

 

 

22

 

Revenue recognition adjustments:

 

 

 

 

 

 

 

Reportability

 

2

 

 

 

(2

)

 

 

(2

)

 

 

3

 

Sales reserve(1)

 

(56

)

 

 

(47

)

 

 

(278

)

 

 

(232

)

Other(2)

 

(28

)

 

 

(27

)

 

 

(104

)

 

 

(102

)

Sale of vacation ownership products

 

400

 

 

 

375

 

 

 

1,448

 

 

 

1,460

 

Less:

 

 

 

 

 

 

 

Cost of vacation ownership products

 

(55

)

 

 

(50

)

 

 

(200

)

 

 

(224

)

Marketing and sales

 

(242

)

 

 

(205

)

 

 

(919

)

 

 

(823

)

Development Profit

 

103

 

 

 

120

 

 

 

329

 

 

 

413

 

Revenue recognition reportability adjustment

 

—

 

 

 

1

 

 

 

3

 

 

 

(2

)

Purchase accounting adjustments

 

—

 

 

 

3

 

 

 

1

 

 

 

9

 

Adjusted development profit*

$

103

 

 

$

124

 

 

$

333

 

 

$

420

 

Development profit margin

25.7%

 

32.0%

 

22.7%

 

28.3%

Adjusted development profit margin*

25.7%

 

33.1%

 

23.0%

 

28.8%

 

 

 

 

 

 

 

 

(1) Reflects increases in the Company’s sales reserve of $70 million and $59 million recorded in the second quarter of 2024 and third quarter of 2023, respectively.

(2) 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-6

 

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, 2024

 

December 31, 2023

 

December 31, 2024

 

December 31, 2023

Net income attributable to common stockholders

$

50

 

 

$

35

 

 

$

218

 

 

$

254

 

Provision for income taxes

 

10

 

 

 

31

 

 

 

89

 

 

 

146

 

Income before income taxes attributable to common stockholders

 

60

 

 

 

66

 

 

 

307

 

 

 

400

 

Certain items:

 

 

 

 

 

 

 

ILG integration

 

—

 

 

 

—

 

 

 

—

 

 

 

15

 

Welk acquisition and integration

 

—

 

 

 

9

 

 

 

18

 

 

 

22

 

Transaction and integration costs

 

—

 

 

 

9

 

 

 

18

 

 

 

37

 

Early redemption of senior secured notes

 

—

 

 

 

—

 

 

 

—

 

 

 

10

 

Gain on disposition of hotel, land, and other

 

(6

)

 

 

—

 

 

 

(8

)

 

 

(8

)

Foreign currency translation loss (gain)

 

13

 

 

 

(7

)

 

 

13

 

 

 

(6

)

Insurance proceeds

 

(5

)

 

 

(6

)

 

 

(5

)

 

 

(9

)

Change in indemnification asset

 

1

 

 

 

(1

)

 

 

5

 

 

 

(31

)

Change in estimates relating to pre-acquisition contingencies

 

—

 

 

 

—

 

 

 

(4

)

 

 

—

 

Other

 

—

 

 

 

1

 

 

 

—

 

 

 

(3

)

Losses (gains) and other expense (income), net

 

3

 

 

 

(13

)

 

 

1

 

 

 

(47

)

Purchase accounting adjustments

 

—

 

 

 

2

 

 

 

1

 

 

 

8

 

Litigation charges

 

2

 

 

 

6

 

 

 

17

 

 

 

13

 

Restructuring charges

 

6

 

 

 

6

 

 

 

10

 

 

 

6

 

Impairment charges

 

28

 

 

 

28

 

 

 

30

 

 

 

32

 

Other

 

1

 

 

 

1

 

 

 

2

 

 

 

1

 

Adjusted pretax income*

 

100

 

 

 

105

 

 

 

386

 

 

 

450

 

Provision for income taxes

 

(27

)

 

 

(30

)

 

 

(128

)

 

 

(128

)

Adjusted net income attributable to common stockholders*

$

73

 

 

$

75

 

 

$

258

 

 

$

322

 

 

 

 

 

 

 

 

 

Diluted shares

 

42.1

 

 

 

42.5

 

 

 

42.1

 

 

 

43.5

 

Adjusted earnings per share - Diluted*

$

1.86

 

 

$

1.88

 

 

$

6.56

 

 

$

7.83

 

 

 

 

 

 

 

 

 

* 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

ADJUSTED EBITDA

(In millions)

 

 

Three Months Ended

 

Twelve Months Ended

 

December 31, 2024

 

December 31, 2023

 

December 31, 2024

 

December 31, 2023

Net income attributable to common stockholders

$

50

 

 

$

35

 

 

$

218

 

 

$

254

 

Interest expense, net

 

39

 

 

 

39

 

 

 

162

 

 

 

145

 

Provision for income taxes

 

10

 

 

 

31

 

 

 

89

 

 

 

146

 

Depreciation and amortization

 

37

 

 

 

36

 

 

 

146

 

 

 

135

 

Share-based compensation

 

9

 

 

 

6

 

 

 

33

 

 

 

31

 

Certain items:

 

 

 

 

 

 

 

ILG integration

 

—

 

 

 

—

 

 

 

—

 

 

 

15

 

Welk acquisition and integration

 

—

 

 

 

9

 

 

 

18

 

 

 

22

 

Transaction and integration costs

 

—

 

 

 

9

 

 

 

18

 

 

 

37

 

Early redemption of senior secured notes

 

—

 

 

 

—

 

 

 

—

 

 

 

10

 

Gain on disposition of hotel, land, and other

 

(6

)

 

 

—

 

 

 

(8

)

 

 

(8

)

Foreign currency translation loss (gain)

 

13

 

 

 

(7

)

 

 

13

 

 

 

(6

)

Insurance proceeds

 

(5

)

 

 

(6

)

 

 

(5

)

 

 

(9

)

Change in indemnification asset

 

1

 

 

 

(1

)

 

 

5

 

 

 

(31

)

Change in estimates relating to pre-acquisition contingencies

 

—

 

 

 

—

 

 

 

(4

)

 

 

—

 

Other

 

—

 

 

 

1

 

 

 

—

 

 

 

(3

)

Losses (gains) and other expense (income), net

 

3

 

 

 

(13

)

 

 

1

 

 

 

(47

)

Purchase accounting adjustments

 

—

 

 

 

2

 

 

 

1

 

 

 

8

 

Litigation charges

 

2

 

 

 

6

 

 

 

17

 

 

 

13

 

Restructuring charges

 

6

 

 

 

6

 

 

 

10

 

 

 

6

 

Impairment charges

 

28

 

 

 

28

 

 

 

30

 

 

 

32

 

Other

 

1

 

 

 

1

 

 

 

2

 

 

 

1

 

Adjusted EBITDA*

$

185

 

 

$

186

 

 

$

727

 

 

$

761

 

Adjusted EBITDA Margin*

21.0%

 

23.3%

 

22.2%

 

24.0%

 

 

 

 

 

 

 

 

* 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

(In millions)

(Unaudited)

VACATION OWNERSHIP SEGMENT ADJUSTED EBITDA

 

 

Three Months Ended

 

Twelve Months Ended

 

December 31, 2024

 

December 31, 2023

 

December 31, 2024

 

December 31, 2023

Segment financial results attributable to common stockholders

$

172

 

 

$

199

 

 

$

703

 

 

$

777

 

Depreciation and amortization

 

25

 

 

 

24

 

 

 

100

 

 

 

93

 

Share-based compensation

 

2

 

 

 

2

 

 

 

8

 

 

 

8

 

Certain items:

 

 

 

 

 

 

 

Gain on disposition of hotel, land, and other

 

(6

)

 

 

—

 

 

 

(7

)

 

 

(7

)

Insurance proceeds

 

(5

)

 

 

(6

)

 

 

(5

)

 

 

(9

)

Change in indemnification asset

 

—

 

 

 

—

 

 

 

—

 

 

 

(9

)

Change in estimates relating to pre-acquisition contingencies

 

—

 

 

 

—

 

 

 

(4

)

 

 

—

 

Other

 

—

 

 

 

—

 

 

 

—

 

 

 

(4

)

Gains and other income, net

 

(11

)

 

 

(6

)

 

 

(16

)

 

 

(29

)

Purchase accounting adjustments

 

—

 

 

 

2

 

 

 

1

 

 

 

8

 

Litigation charges

 

3

 

 

 

4

 

 

 

18

 

 

 

12

 

Restructuring charges

 

—

 

 

 

—

 

 

 

1

 

 

 

—

 

Impairment charges

 

28

 

 

 

8

 

 

 

28

 

 

 

12

 

Other

 

2

 

 

 

3

 

 

 

2

 

 

 

2

 

Segment Adjusted EBITDA*

$

221

 

 

$

236

 

 

$

845

 

 

$

883

 

Segment Adjusted EBITDA Margin*

27.0%

 

32.5%

 

28.1%

 

30.7 %

 

 

 

 

 

 

 

 

EXCHANGE & THIRD-PARTY MANAGEMENT SEGMENT ADJUSTED EBITDA

 

 

Three Months Ended

 

Twelve Months Ended

 

December 31, 2024

 

December 31, 2023

 

December 31, 2024

 

December 31, 2023

Segment financial results attributable to common stockholders

$

14

 

 

$

18

 

 

$

69

 

 

$

93

 

Depreciation and amortization

 

7

 

 

 

8

 

 

 

28

 

 

 

31

 

Share-based compensation

 

—

 

 

 

1

 

 

 

2

 

 

 

2

 

Certain items:

 

 

 

 

 

 

 

Gain on disposition of hotel, land, and other

 

—

 

 

 

—

 

 

 

(1

)

 

 

(1

)

Foreign currency translation loss

 

1

 

 

 

—

 

 

 

1

 

 

 

—

 

Litigation charges

 

—

 

 

 

1

 

 

 

—

 

 

 

1

 

Restructuring charges

 

—

 

 

 

—

 

 

 

1

 

 

 

—

 

Impairment charges

 

—

 

 

 

4

 

 

 

2

 

 

 

4

 

Other

 

—

 

 

 

(1

)

 

 

—

 

 

 

—

 

Segment Adjusted EBITDA*

$

22

 

 

$

31

 

 

$

102

 

 

$

130

 

Segment Adjusted EBITDA Margin*

44.2%

 

52.2%

 

45.9%

 

52.5%

 

 

 

 

 

 

 

 

* 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

(In millions)

(unaudited)

CASH FLOW AND ADJUSTED FREE CASH FLOW

 

 

Fiscal Year

CASH FLOW

 

2024

 

 

 

2023

 

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

 

 

 

Operating activities

$

205

 

 

$

232

 

Investing activities

 

(115

)

 

 

(112

)

Financing activities

 

(132

)

 

 

(401

)

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

 

(4

)

 

 

1

 

Net change in cash, cash equivalents, and restricted cash

$

(46

)

 

$

(280

)

 

 

 

 

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

$

205

 

 

$

232

 

Capital expenditures for property and equipment (excluding inventory)

 

(57

)

 

 

(118

)

Borrowings from securitizations, net of repayments

 

42

 

 

 

161

 

Securitized debt issuance costs

 

(13

)

 

 

(12

)

Free cash flow*

 

177

 

 

 

263

 

Adjustments:

 

 

 

Capital expenditures(1)

 

7

 

 

 

56

 

Transaction, integration, and restructuring costs(2)

 

18

 

 

 

33

 

(Increase) decrease in restricted cash

 

(5

)

 

 

4

 

Net change in borrowings available from the securitization of eligible vacation ownership notes receivable(3)

 

68

 

 

 

(2

)

Insurance proceeds(4)

 

(4

)

 

 

(7

)

Litigation charges and other(5)

 

17

 

 

 

1

 

Adjusted free cash flow*

$

278

 

 

$

348

 

(1) Represents adjustment to exclude certain capital expenditures.

(2) Represents adjustment to exclude the after-tax impact of transaction and integration costs, primarily in connection with the Welk Acquisition and business restructuring.

(3) Represents the net change in borrowings available from the securitization of eligible vacation ownership notes receivable compared to the prior year end.

(4) Represents adjustment to exclude the after tax impact of insurance proceeds.

(5) Represents adjustment to exclude the after-tax impact of litigation charges and miscellaneous other items.

* 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.

BALANCE SHEET ITEMS

 

Fiscal Year

 

2024

 

2023

Cash and cash equivalents

$

197

 

$

248

Vacation ownership notes receivable, net

$

2,440

 

$

2,343

Inventory

$

735

 

$

634

Property and equipment, net (1)

$

1,170

 

$

1,260

Goodwill

$

3,117

 

$

3,117

Intangibles, net

$

790

 

$

854

Debt, net

$

3,089

 

$

3,049

Stockholders’ equity

$

2,442

 

$

2,382

(1) Includes $271 million and $370 million at December 31, 2024 and December 31, 2023, respectively, of completed vacation ownership units which are classified as a component of Property and equipment, net until the time at which they are available and legally registered for sale as vacation ownership projects.

A-10

 

MARRIOTT VACATIONS WORLDWIDE CORPORATION

2025 ADJUSTED FREE CASH FLOW OUTLOOK

(In millions)

 

 

 

Fiscal Year 2025

 

 

Low

 

High

Adjusted EBITDA*

 

$

750

 

 

$

780

 

Cash interest

 

 

(150

)

 

 

(145

)

Cash taxes

 

 

(150

)

 

 

(155

)

Corporate capital expenditures

 

 

(65

)

 

 

(65

)

Inventory

 

 

(75

)

 

 

(60

)

Financing activity and other

 

 

(20

)

 

 

(5

)

Adjusted free cash flow*

 

$

290

 

 

$

350

 

 

The guidance provided above excludes impacts from asset sales, foreign currency changes, restructuring costs, litigation charges, strategic modernization initiative costs, transaction and integration costs, and impairments, each of which the Company cannot forecast with sufficient accuracy to factor them into the guidance provided above and without unreasonable efforts, and which may be significant. As a result, the full year 2025 adjusted free cash flow is presented only on a non-GAAP basis and is not reconciled to the most comparable GAAP measures. Where one or more of the currently unavailable items is applicable, some items could be material, individually or in the aggregate, to GAAP reported results.

* 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

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

 

 

 

 

 

 

 

 

 

 

 

 

2024

 

$

428

 

$

449

 

$

459

 

$

477

 

$

1,813

 

2023

 

$

434

 

$

453

 

$

438

 

$

447

 

$

1,772

 

2022

 

$

394

 

$

506

 

$

483

 

$

454

 

$

1,837

 

 

 

 

 

 

 

 

 

 

 

 

VPG

 

 

 

 

 

 

 

 

 

 

 

 

2024

 

$

4,129

 

$

3,741

 

$

3,888

 

$

3,916

 

$

3,911

 

2023

 

$

4,358

 

$

3,968

 

$

4,055

 

$

4,002

 

$

4,088

 

2022

 

$

4,706

 

$

4,613

 

$

4,353

 

$

4,088

 

$

4,421

 

 

 

 

 

 

 

 

 

 

 

 

Tours

 

 

 

 

 

 

 

 

 

 

 

 

2024

 

 

96,579

 

 

111,752

 

 

110,557

 

 

113,828

 

 

432,716

 

2023

 

 

92,890

 

 

106,746

 

 

100,609

 

 

105,580

 

 

405,825

 

2022

 

 

78,505

 

 

102,857

 

 

104,000

 

 

105,231

 

 

390,593

 

 

 

 

 

 

 

 

 

 

 

 

Exchange & Third-Party Management

 

 

 

 

 

 

 

 

 

 

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

 

 

 

 

 

 

 

2024

 

 

1,566

 

 

1,530

 

 

1,545

 

 

1,546

 

 

1,546

 

2023

 

 

1,568

 

 

1,566

 

 

1,571

 

 

1,564

 

 

1,564

 

2022

 

 

1,606

 

 

1,596

 

 

1,591

 

 

1,566

 

 

1,566

 

 

 

 

 

 

 

 

 

 

 

 

Average revenue per Interval International member

 

 

 

 

 

 

 

2024

 

$

41.74

 

$

38.30

 

$

38.93

 

$

35.36

 

$

154.34

 

2023

 

$

42.07

 

$

39.30

 

$

39.15

 

$

36.16

 

$

156.65

 

2022

 

$

44.33

 

$

38.79

 

$

38.91

 

$

35.60

 

$

157.97

 

 

 

 

 

 

 

 

 

 

 

 

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

A-12

MARRIOTT VACATIONS WORLDWIDE CORPORATION NON-GAAP FINANCIAL MEASURES

In our press release and schedules, and on the related conference call, we report certain financial measures that are not prescribed by GAAP. We discuss our reasons for reporting these non-GAAP financial measures below, and the financial schedules included herein reconcile the most directly comparable GAAP financial measure to each non-GAAP financial measure that we report (identified by an asterisk (“*”) on the preceding pages). Although we evaluate and present these non-GAAP financial measures for the reasons described below, please be aware that these non-GAAP financial measures have limitations and should not be considered in isolation or as a substitute for revenues, net income or loss attributable to common stockholders, earnings or loss per share or any other comparable operating measure prescribed by GAAP. In addition, other companies in our industry may calculate these non-GAAP financial measures differently than we do or may not calculate them at all, limiting their usefulness as comparative measures.

Certain Items Excluded from Non-GAAP Financial Measures We evaluate non-GAAP financial measures, including those identified by an asterisk (“*”) on the preceding pages, that exclude certain items as further described in the financial schedules included herein, and believe these measures provide useful information to investors because these non-GAAP financial measures allow for period-over-period comparisons of our on-going core operations before the impact of these items. These non-GAAP financial measures also facilitate the comparison of results from our on-going core operations before these items with results from other companies.

Adjusted Development Profit and Adjusted Development Profit Margin We evaluate Adjusted development profit (Adjusted sale of vacation ownership products, net of expenses) and Adjusted development profit margin as indicators of operating performance. Adjusted development profit margin is calculated by dividing Adjusted development profit by revenues from the Sale of vacation ownership products. Adjusted development profit and Adjusted development profit margin adjust Sale of vacation ownership products revenues for the impact of revenue reportability, include corresponding adjustments to Cost of vacation ownership products associated with the change in revenues from the Sale of vacation ownership products, and may include adjustments for certain items as necessary. We evaluate Adjusted development profit and Adjusted development profit margin and believe they provide useful information to investors because they allow for period-over-period comparisons of our on-going core operations before the impact of revenue reportability and certain items to our Development profit and Development profit margin.

Earnings Before Interest Expense, Taxes, Depreciation and Amortization (“EBITDA”) and Adjusted EBITDA EBITDA, a financial measure that is not prescribed by GAAP, is defined as earnings, or net income or loss attributable to common stockholders, before interest expense, net (excluding consumer financing interest expense associated with term securitization transactions), income taxes, depreciation and amortization. Adjusted EBITDA reflects additional adjustments for certain items and excludes share-based compensation expense to address considerable variability among companies in recording compensation expense because companies use share-based payment awards differently, both in the type and quantity of awards granted. For purposes of our EBITDA and Adjusted EBITDA calculations, we do not adjust for consumer financing interest expense associated with term securitization transactions because we consider it to be an operating expense of our business. We consider Adjusted EBITDA to be an indicator of operating performance, which we use to measure our ability to service debt, fund capital expenditures, expand our business, and return cash to stockholders. We also use Adjusted EBITDA, as do analysts, lenders, investors and others, because this measure excludes certain items that can vary widely across different industries or among companies within the same industry. For example, interest expense can be dependent on a company’s capital structure, debt levels and credit ratings. Accordingly, the impact of interest expense on earnings can vary significantly among companies. The tax positions of companies can also vary because of their differing abilities to take advantage of tax benefits and because of the tax policies of the jurisdictions in which they operate. As a result, effective tax rates and provisions for income taxes can vary considerably among companies. EBITDA and Adjusted EBITDA also exclude depreciation and amortization because companies utilize productive assets of different ages and use different methods of both acquiring and depreciating productive assets. These differences can result in considerable variability in the relative costs of productive assets and the depreciation and amortization expense among companies. We believe Adjusted EBITDA is useful as an indicator of operating performance because it allows for period-over-period comparisons of our on-going core operations before the impact of the excluded items. Adjusted EBITDA also facilitates comparison by us, analysts, investors, and others, of results from our on-going core operations before the impact of these items with results from other companies.

Adjusted EBITDA Margin and Segment Adjusted EBITDA Margin We evaluate Adjusted EBITDA margin and Segment Adjusted EBITDA margin as indicators of operating profitability. Adjusted EBITDA margin represents Adjusted EBITDA divided by the Company’s total revenues less cost reimbursement revenues. Segment Adjusted EBITDA margin represents Segment Adjusted EBITDA divided by the applicable segment’s total revenues less cost reimbursement revenues. We evaluate Adjusted EBITDA margin and Segment Adjusted EBITDA margin and believe it provides useful information to investors because it allows for period-over-period comparisons of our on-going core operations before the impact of excluded items.

Adjusted Pretax Income, Adjusted Net Income Attributable to Common Stockholders, and Adjusted Earnings Per Share - Diluted We evaluate Adjusted pretax income, Adjusted net income attributable to common stockholders, and Adjusted earnings per share - diluted as indicators of operating performance. Adjusted pretax income is calculated as Adjusted EBITDA less depreciation and amortization and interest expense, net of interest income. Adjusted net income attributable to common stockholders is calculated as Adjusted pretax income less provision for income tax adjusted for certain items and Adjusted earnings per share - diluted equals adjusted net income attributable to common stockholders divided by diluted shares. We evaluate these measures because we believe they provide useful information to investors because they allow for period-over-period comparisons of our on-going core operations before the impact of certain non-recurring items such as impacts from asset sales, restructuring costs, litigation charges, strategic modernization initiative costs, transaction and integration costs, and impairments, and also facilitate the comparison of results from our on-going core operations before these items with results from other companies.

Free Cash Flow and Adjusted Free Cash Flow We evaluate Free Cash Flow and Adjusted Free Cash Flow as liquidity measures that provide useful information to management and investors about the amount of cash provided by operating activities after capital expenditures for property and equipment and the borrowing and repayment activity related to our term securitizations, which cash can be used for, among other purposes, strategic opportunities, including acquisitions and strengthening the balance sheet. Adjusted Free Cash Flow, which reflects additional adjustments to Free Cash Flow for the impact of transaction, integration and restructuring costs, litigation charges, insurance proceeds, impact of borrowings available from the securitization of eligible vacation ownership notes receivable, and changes in restricted cash and other items, allows for period-over-period comparisons of the cash generated by our business before the impact of these items. Analysis of Free Cash Flow and Adjusted Free Cash Flow also facilitates management’s comparison of our results with our competitors’ results.

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Neal Goldner Investor Relations 407-206-6149 neal.goldner@mvwc.com

Cameron Klaus Global Communications 407-513-6606 cameron.klaus@mvwc.com