Marriott Vacations Worldwide Corporation (VAC) is likely to benefit from strong rental performance, sales promotions and cost management efforts. Focus on expanding presence in high-demand destinations bodes well. However, dismal contract sales are a concern. Factors Driving VAC Stock VAC focuses on rental performance to drive growth. In the second quarter of 2024, the company witnessed strong rental results, with higher revenues from more keys rented and lower costs due to increased preview packages drivin ...

Marriott Vacations Worldwide Corporation. (NYSE:VAC) Q2 2024 Earnings Conference Call August 1, 2024 8:30 AM ET Company Participants Neal Goldner - VP-IR John Geller - President and CEO Jason Marino - EVP and CFO Conference Call Participants Benjamin Chaiken - Mizuho David Katz - Jefferies Patrick Scholes - Truist Securities Brandt Montour - Barclays Chris Woronka - Deutsche Bank Shaun Kelley - Bank of America Operator Greetings, and welcome to the Marriott Vacations Worldwide Second Quarter 2024 Earnings C ...

Revenue Performance - Total revenues for the six months ended June 30, 2024, were $2.335 billion, compared to $2.347 billion for the same period in 2023[133] - Sale of vacation ownership products revenue for the six months ended June 30, 2024, was $661 million, down from $766 million in the same period in 2023[133] - Management and exchange revenue increased to $426 million for the six months ended June 30, 2024, from $406 million in the same period in 2023[133] - Rental revenue rose to $311 million for the six months ended June 30, 2024, compared to $297 million in the same period in 2023[133] - Financing revenue increased to $168 million for the six months ended June 30, 2024, from $158 million in the same period in 2023[133] - Total Segment Revenues decreased by $41 million (4%) to $1,136 million in Q2 2024 compared to Q2 2023[136] - Vacation Ownership segment's revenues decreased by 3% to $1.078 billion in Q2 2024 from $1.112 billion in Q2 2023[151] - Sale of vacation ownership products revenue for Q2 2024 was $309 million, a 21% decrease compared to $391 million in Q2 2023[154] - Resort management and other services revenues for Q2 2024 were $157 million, a 7% increase compared to $147 million in Q2 2023[161] - Rental revenues increased to $143 million in Q2 2024, up 6% from $135 million in Q2 2023[162] - Financing revenues rose 7% to $85 million in Q2 2024 from $80 million in Q2 2023[165] - Management and exchange revenues decreased 9% to $45 million in Q2 2024 from $51 million in Q2 2023[168] - Total revenues for the three months ended June 30, 2024 were $4 million, compared to $1 million in the same period in 2023[171] - Total revenues for the six months ended June 30, 2024 were $4 million, compared to $2 million in the same period in 2023[171] Profitability and Margins - Net income attributable to common stockholders for the six months ended June 30, 2024, was $84 million, down from $177 million in the same period in 2023[133] - Net income attributable to common stockholders decreased by $53 million (59%) to $37 million in Q2 2024 compared to Q2 2023[140] - Adjusted EBITDA decreased by $65 million (29%) to $157 million in Q2 2024 compared to Q2 2023[140] - Adjusted EBITDA Margin decreased by 6.2 percentage points to 20.7% in Q2 2024 compared to 26.9% in Q2 2023[140] - Vacation Ownership segment's Adjusted EBITDA decreased by 26% to $180 million in Q2 2024 compared to $245 million in Q2 2023[144][145] - Exchange & Third-Party Management segment's Adjusted EBITDA declined by 22% to $25 million in Q2 2024 from $32 million in Q2 2023[144][149] - Total Adjusted EBITDA for the company fell by 29% to $157 million in Q2 2024 versus $222 million in Q2 2023[144] - Vacation Ownership segment's Adjusted EBITDA margin dropped by 6.5 percentage points to 26.0% in Q2 2024 compared to 32.5% in Q2 2023[145] - Exchange & Third-Party Management segment's Adjusted EBITDA margin decreased by 7.6 percentage points to 44.3% in Q2 2024 from 51.9% in Q2 2023[149] - Vacation Ownership segment's financial results attributable to common stockholders declined by 36% to $144 million in Q2 2024 from $224 million in Q2 2023[145][151] - Exchange & Third-Party Management segment's financial results attributable to common stockholders decreased by 35% to $15 million in Q2 2024 from $24 million in Q2 2023[149] - Development profit for Q2 2024 was $45 million, a 62% decrease compared to $119 million in Q2 2023[158] - Development profit margin for Q2 2024 was 14.7%, a 16.1 percentage point decrease compared to 30.8% in Q2 2023[158] - Resort management and other services profit for Q2 2024 was $84 million, a 9% increase compared to $78 million in Q2 2023[161] - Rental profit surged 64% to $30 million in Q2 2024 compared to $19 million in Q2 2023[162] - Financing profit margin declined by 11.1 percentage points to 58.0% in Q2 2024[165] - Gains and other income dropped 82% to $1 million in Q2 2024 from $7 million in Q2 2023[166] Expenses - Total expenses for the six months ended June 30, 2024, were $2.096 billion, compared to $2.018 billion in the same period in 2023[133] - Marketing and sales expenses increased to $449 million for the six months ended June 30, 2024, from $416 million in the same period in 2023[133] - General and administrative expenses decreased to $117 million for the six months ended June 30, 2024, from $132 million in the same period in 2023[133] - Depreciation and amortization expenses rose to $73 million for the six months ended June 30, 2024, from $66 million in the same period in 2023[133] - General and administrative expenses decreased by $10 million (15%) in the second quarter of 2024 compared to the same period in 2023, primarily due to lower information technology costs, insurance expense, and compensation expense[175] - General and administrative expenses decreased by $15 million (11%) in the first half of 2024 compared to the same period in 2023, primarily due to lower information technology costs, insurance expense, and compliance-related expenses[175] - Interest expense, net increased by $7 million (21%) in the second quarter of 2024 compared to the same period in 2023, and by $13 million (19%) in the first half of 2024 compared to the same period in 2023[179] - Litigation charges increased significantly to $10 million in Q2 2024 from $3 million in Q2 2023[167] Vacation Ownership Performance - Total contract sales for Vacation Ownership decreased by $10 million (2%) to $452 million in Q2 2024 compared to Q2 2023[135] - Consolidated contract sales for Vacation Ownership decreased by $4 million (1%) to $449 million in Q2 2024 compared to Q2 2023[135] - Joint venture contract sales for Vacation Ownership decreased by $6 million (65%) to $3 million in Q2 2024 compared to Q2 2023[135] - VPG (Volume Per Guest) decreased by $227 (6%) to $3,741 in Q2 2024 compared to Q2 2023[135] - Total active members at the end of the period decreased by 36,000 (2%) to 1,530,000 in Q2 2024 compared to Q2 2023[135] - Average revenue per member decreased by $1.00 (3%) to $38.30 in Q2 2024 compared to Q2 2023[135] - Vacation Ownership segment's sale of vacation ownership products revenue dropped by 21% to $309 million in Q2 2024 from $391 million in Q2 2023[151] - Vacation Ownership segment's cost of vacation ownership products decreased by 42% to $38 million in Q2 2024 from $66 million in Q2 2023[151] - Consolidated contract sales for Q2 2024 were $449 million, a 1% decrease compared to $453 million in Q2 2023[154] - Total contract sales for Q2 2024 were $452 million, a 2% decrease compared to $462 million in Q2 2023[154] - The company increased its sales reserve by $70 million in Q2 2024 to reflect higher expected cumulative loss rates for vacation ownership notes receivable[156] - The company expects full-year 2024 contract sales to reflect lower VPG for the second half of 2024, partially offset by tour growth in first-time buyer tours[156] Rental and Resort Performance - Resort occupancy for Q2 2024 was 90.1%, a 1.4 percentage point increase compared to 88.7% in Q2 2023[161] - Transient keys rented grew 5% to 575,704 in Q2 2024 from 549,329 in Q2 2023[162] - Average transient rate decreased 7% to $245 in Q2 2024 from $263 in Q2 2023[162] - Rental occupancy improved by 3.6 percentage points to 74.4% in Q2 2024[162] Financial Position and Debt - The company's corporate debt, net of cash and equivalents, to Adjusted EBITDA ratio was 4.4 as of June 30, 2024, above the targeted range of 2.5 to 3.0, with a goal to reduce this ratio to 3.0 by the end of 2025[182] - In the second quarter of 2024, the company amended the Corporate Credit Facility to provide for a new $800 million term loan facility scheduled to mature on April 1, 2031[182] - The company has issued approximately $9.4 billion of debt securities in securitization transactions in the term ABS market since 2000[184] - As of June 30, 2024, $108 million of borrowings were outstanding under the Warehouse Credit Facility[186] - $71 million of gross vacation ownership notes receivable were eligible for securitization as of June 30, 2024[186] - The Revolving Corporate Credit Facility provides for up to $750 million of aggregate borrowings, with $175 million of borrowings and $32 million of letters of credit outstanding as of June 30, 2024[186] - Inventory spending for the six months ended June 30, 2024 was $63 million, compared to $41 million for the same period in 2023[189] - Vacation ownership notes receivable collections for the six months ended June 30, 2024 were $67 million (non-securitized) and $244 million (securitized), compared to $90 million and $218 million respectively for the same period in 2023[191] - The company repurchased 410,377 shares during the first half of 2024 at an average price of $88.99 per share, totaling $36 million[192] - Total future material cash requirements as of June 30, 2024 are $7.517 billion, including $3.541 billion in debt and $2.710 billion in securitized debt[195] - The company expects to pay quarterly dividends in the future, subject to board approval and financial conditions, with the last three dividends paid at $0.76 per share[193] - The company amended its Corporate Credit Facility in Q2 2024 to provide for a New Term Loan scheduled to mature on April 1, 2031, used to refinance a $784 million Term Loan[195] - Consolidated revenues for the six months ended June 30, 2024, were $2.335 billion, with expenses totaling $2.206 billion, resulting in a net income of $84 million[198] - Total assets as of June 30, 2024, amounted to $9.611 billion, with liabilities and equity also totaling $9.611 billion[198] - Cash and cash equivalents as of June 30, 2024, were $206 million, with restricted cash at $326 million[198] - Accounts and contracts receivable, net, stood at $251 million, while vacation ownership notes receivable, net, were $2.308 billion[198] - Property and equipment, net, were valued at $1.295 billion, and goodwill was reported at $3.117 billion[198] - Total liabilities as of June 30, 2024, were $7.239 billion, with MVW stockholders' equity at $2.372 billion[198] - As of December 31, 2023, total assets were $9.680 billion, with liabilities and equity also totaling $9.680 billion[199] - Cash and cash equivalents as of December 31, 2023, were $248 million, with restricted cash at $326 million[199] - Accounts and contracts receivable, net, as of December 31, 2023, were $385 million, while vacation ownership notes receivable, net, were $2.343 billion[199] - Property and equipment, net, as of December 31, 2023, were valued at $1.260 billion, and goodwill was reported at $3.117 billion[199] - 67% of the company's corporate debt ($2.0 billion) has a fixed interest rate, while 33% ($975 million) is variable as of June 30, 2024[204] - A 100 basis point increase in the benchmark rate on variable-rate debt would result in an annual cash interest increase of $8 million[204] - Vacation ownership notes receivable (nonsecuritized) have an average interest rate of 12.0% and a total carrying value of $402 million[204] - Securitized vacation ownership notes receivable have an average interest rate of 13.4% and a total carrying value of $1.906 billion[204] - Securitized debt has an average interest rate of 4.8% and a total carrying value of ($2.124 billion)[204] - The Term Loan has an average interest rate of 7.6% and a total carrying value of ($800 million)[204] - The Revolving Corporate Credit Facility has an average interest rate of 7.4% and a total carrying value of ($175 million)[204] - The 2028 Notes have an average interest rate of 4.8% and a total carrying value of ($350 million)[204] - The 2029 Notes have an average interest rate of 4.5% and a total carrying value of ($500 million)[204] - The 2026 Convertible Notes have an average interest rate of 0.0% and a total carrying value of ($575 million)[204] Tax and Interest Rates - The effective tax rate for the three months ended June 30, 2024 was 22.0%, compared to 35.4% in the same period in 2023[179] - The effective tax rate for the six months ended June 30, 2024 was 35.2%, compared to 33.9% in the same period in 2023[180]

Core Insights - Marriott Vacations Worldwide Corporation (VAC) reported disappointing second-quarter 2024 results, with both earnings and revenues falling short of Zacks Consensus Estimates, showing a year-over-year decline [1][3] Earnings & Revenue Discussion - Adjusted earnings per share (EPS) were $1.10, missing the Zacks Consensus Estimate of $1.99 by 44.7%, down from $2.19 in the same quarter last year [3] - Quarterly revenues totaled $1,140 million, missing the consensus mark of $1,217 million by 6.3%, and declined 3% year-over-year [3] Segmental Performances - Vacation Ownership segment revenues were $1.08 billion, down 3.1% from $1.1 billion in the prior-year quarter [4] - Contract sales in the Vacation Ownership segment decreased by 1% year-over-year to $449 million, primarily due to a 6% decline in VPG and the impact of the Maui wildfires; excluding Maui, contract sales rose 3% [4] - Adjusted EBITDA for the Vacation Ownership segment was $180 million, down 26% from $245 million in the year-ago quarter [4] - Exchange & Third-Party Management segment revenues were $58 million, a decrease of 10.8% year-over-year, with adjusted EBITDA at $25 million, down 22% [5] Expenses & EBITDA - Total expenses increased by 3.5% year-over-year to $1.04 billion, while adjusted EBITDA was $157 million, down 29% from $222 million in the prior-year quarter [7] Balance Sheet - As of June 30, the company had cash and cash equivalents of $206 million, down from $248 million as of December 31, 2023; corporate debt stood at $3.1 billion and nonrecourse debt at $2.1 billion [8] Updated 2024 Outlook - Management revised contract sales guidance for 2024 to a range of $1,790-$1,825 million, down from $1,880-$1,930 million; adjusted free cash flow is now projected at $300-$340 million, down from $400-$450 million [9] - Adjusted EBITDA is estimated to be between $685 million and $715 million, reduced from the previous estimate of $760 million to $800 million [9] - Adjusted EPS expectations have been lowered to a range of $5.90 to $6.45, down from the prior estimate of $7.45 to $8.16 [10]

Marriott Vacations Worldwide (VAC) reported $1.14 billion in revenue for the quarter ended June 2024, representing a year-over-year decline of 3.2%. EPS of $1.10 for the same period compares to $2.19 a year ago. The reported revenue represents a surprise of -6.33% over the Zacks Consensus Estimate of $1.22 billion. With the consensus EPS estimate being $1.99, the EPS surprise was -44.72%. While investors closely watch year-over-year changes in headline numbers -- revenue and earnings -- and how they compare ...

Marriott Vacations Worldwide (VAC) came out with quarterly earnings of $1.10 per share, missing the Zacks Consensus Estimate of $1.99 per share. This compares to earnings of $2.19 per share a year ago. These figures are adjusted for non-recurring items. This quarterly report represents an earnings surprise of -44.72%. A quarter ago, it was expected that this timeshare company would post earnings of $1.66 per share when it actually produced earnings of $1.80, delivering a surprise of 8.43%. Over the last fou ...

Exhibit 99.1 [DRAFT 9] M A R R I O T T W O R L D W I D E T Neal Goldner Investor Relations 407-206-6149 neal.goldner@mvwc.com Cameron Klaus Global Communications 407-513-6606 cameron.klaus@mvwc.com Marriott Vacations Worldwide Reports Second Quarter 2024 Financial Results ORLANDO, Fla. – July 31, 2024 – Marriott Vacations Worldwide Corporation (NYSE: VAC) ("MVW," the "Company," "we" or "our") reported second quarter 2024 financial results. Second Quarter 2024 Highlights • Consolidated Vacation Ownership con ...

Bottom Line Expected Results of an Industry Player While the sustainability of the immediate price change and future earnings expectations will mostly depend on management's discussion of business conditions on the earnings call, it's worth handicapping the probability of a positive EPS surprise. Please note that a negative Earnings ESP reading is not indicative of an earnings miss. Our research shows that it is difficult to predict an earnings beat with any degree of confidence for stocks with negative Ear ...

Marriott Vacations Worldwide Corporation (VAC) is well-poised to benefit from strength in packages, solid summer bookings and the Abound by Marriott Vacations program. However, increased expenses, Maui Wildfires and a fall in Volume Per Guests (VPGs) are headwinds. Shares of the company have lost 31.2% in the past year against the industry's growth of 9.4%. However, in the past six months, VAC's shares have shown some resilience, rising 11.6% compared with the industry's growth of 8%. Let's delve deeper. Gr ...

Marriott Vacations Worldwide Corporation (NYSE:VAC) Q1 2024 Earnings Conference Call May 7, 2024 8:30 AM ET Company Participants Neal Goldner - VP-IR John Geller - President and CEO Jason Marino - EVP and CFO Conference Call Participants Ben Chaiken - Mizuho Securities Patrick Scholes - Truist Securities Chris Woronka - Deutsche Bank David Katz - Jefferies Shaun Kelley - Bank of America Ryan Lambert - JPMorgan Operator Greetings, and welcome to the Marriott Vacations Worldwide First Quarter 2024 Earnings Ca ...