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Wyndham Hotels & Resorts(WH) - 2025 Q1 - Quarterly Report
2025-05-01 16:45
Financial Performance - Total net revenues for the three months ended March 31, 2025, increased by $11 million, or 4%, compared to the prior-year period, reaching $316 million [109]. - Adjusted EBITDA for the Hotel Franchising segment increased by $3 million, or 2%, compared to the prior-year period, totaling $161 million [113]. - Operating income for the three months ended March 31, 2025, increased by $62 million, or 124%, compared to the prior-year period, reaching $112 million [109]. - Net income for the three months ended March 31, 2025, increased by $45 million, or 281%, compared to the prior-year period, totaling $61 million [111]. - Total expenses decreased by $51 million, or 20%, compared to the prior-year period, primarily due to lower other expenses [109]. Room and Revenue Growth - The total number of rooms grew by 4% year-over-year, with U.S. rooms increasing by 1% and international rooms by 7% [106]. - Global RevPAR for the three months ended March 31, 2025, increased by 2% year-over-year, driven by a 2% increase in the U.S. and a 3% increase internationally [108]. - The average royalty rate for U.S. franchised properties increased by 19 basis points to 4.8%, while the global average royalty rate rose by 16 basis points to 4.0% [106]. Development and Investments - As of March 31, 2025, the global development pipeline included approximately 2,140 hotels and 254,000 rooms, marking a 5% year-over-year increase [114]. - The company invested $7 million in capital expenditures during Q1 2025, primarily for information technology [128]. - Approximately $28 million was deployed in development advance notes during the quarter, with an expected total investment of $110 million for 2025 [129]. Cash Flow and Shareholder Returns - Net cash provided by operating activities decreased by $17 million year-over-year, totaling $59 million for Q1 2025 [125]. - The company repurchased approximately 0.8 million shares at an average price of $95.23, costing $76 million in Q1 2025 [133]. - Cash dividends declared in Q1 2025 amounted to $0.41 per share, totaling $32 million [134]. Debt and Liabilities - Total assets increased by $26 million from December 31, 2024, to March 31, 2025, primarily due to an increase in development advance notes and loan receivables [117]. - Total liabilities rose by $97 million during the same period, mainly due to a $65 million increase in outstanding debt [117]. - As of March 31, 2025, the first-lien leverage ratio was 2.9 times, in compliance with financial covenants [135]. - As of March 31, 2025, the total outstanding balance of variable-rate borrowings, net of swaps, was $620 million [143]. Interest and Tax Rates - Interest expense for the three months ended March 31, 2025, increased by $5 million, or 18%, compared to the prior-year period, primarily due to a higher average interest rate [109]. - The effective tax rate decreased to 22.8% for the three months ended March 31, 2025, from 27.3% in the prior-year period, due to higher tax benefits associated with stock-based compensation [110]. Market Risks - A hypothetical 10% change in the effective weighted average interest rate on variable-rate borrowings would result in a $3 million increase or decrease in annual long-term debt interest expense [143]. - A hypothetical 10% change in foreign currency exchange rates would result in approximately a $10 million increase or decrease to the fair value of outstanding forward foreign currency exchange contracts [147]. - The company anticipates that foreign currency exchange rate risk will remain a market risk exposure for the foreseeable future [145]. - Total market risk is influenced by market volatility and liquidity, with limitations inherent in the sensitivity analyses presented [149].
Wyndham Hotels & Resorts(WH) - 2025 Q1 - Earnings Call Transcript
2025-05-01 13:32
Financial Data and Key Metrics Changes - Adjusted EBITDA grew 9% on a comparable basis and adjusted EPS increased 20% [6][24] - Global RevPAR grew 2% in constant currency, with U.S. RevPAR starting strong but softening in February and March [7][9] - Free cash flow was $80 million, converting from adjusted EBITDA at approximately 55% [24] Business Line Data and Key Metrics Changes - Fee-related and other revenues increased by $12 million year over year, driven by a 9% increase in royalties and franchise fees [22] - Ancillary revenue growth was primarily driven by higher credit card and partnership fees [22][19] - The company opened 15,000 rooms, a 13% increase from the previous year, and signed 6% more deals than a year ago [15][17] Market Data and Key Metrics Changes - International RevPAR grew in all regions except China, with Latin America seeing a 25% increase [8] - EMEA RevPAR rose 6%, while Southeast Asia and the Pacific Rim posted 8% growth [8] - In China, RevPAR declined 8% year over year due to pricing pressure [8] Company Strategy and Development Direction - The company focuses on growing its system and supporting franchisees, with a record first quarter for room additions [14][20] - The strategy includes prioritizing development in higher fee par geographies and expanding direct franchising [18] - The company aims to capture trade down demand from both leisure and business travelers seeking value [12] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the summer travel months despite recent softness in demand [10][41] - The outlook for full-year constant currency global RevPAR is revised to range between down 2% to up 1% [25][26] - Management remains confident in the long-term growth strategy and the resilience of the business model [29][21] Other Important Information - The company returned nearly $110 million to shareholders through share repurchases and dividends [24] - Wyndham was named one of the world's most ethical companies for the third straight year [20] Q&A Session Summary Question: Can you elaborate on the changes in the U.S. RevPAR outlook? - Management noted that normalized April demand improved, with RevPAR running about a full point ahead of the prior year, indicating potential positive momentum [39][40] Question: What is the long-term outlook for net room growth? - Management reaffirmed a long-term net room growth outlook of 3% to 5%, with a record first quarter for room openings [52][56] Question: How is the company managing development costs amid rising prices? - Management highlighted efforts to shift sourcing and negotiate with suppliers to manage increased costs effectively [67][69] Question: What is the company's strategy regarding key money? - The company is being selective with key money allocations, focusing on high-quality revenue accretive opportunities [78][80] Question: How is the company addressing the recent trends in infrastructure demand? - Management reported a gradual resumption of infrastructure fund disbursements, with expectations of continued growth driven by private investment [106][110]
Wyndham Hotels & Resorts(WH) - 2025 Q1 - Earnings Call Transcript
2025-05-01 12:30
Financial Data and Key Metrics Changes - Adjusted EBITDA grew 9% on a comparable basis and adjusted EPS increased 20% [6][24] - Global RevPAR grew 2% in constant currency, with U.S. RevPAR starting strong but softening in February and March [7][9] - Free cash flow was $80 million, converting from adjusted EBITDA at approximately 55% [24] Business Line Data and Key Metrics Changes - Fee related and other revenues increased by $12 million year over year, driven by a 9% increase in royalties and franchise fees [23] - Ancillary revenue growth was primarily driven by higher credit card and partnership fees [23][19] - The company opened 15,000 rooms, a 13% increase from the previous year, and signed 6% more deals than a year ago [15][17] Market Data and Key Metrics Changes - International RevPAR grew in all regions except China, with Latin America seeing a 25% increase [8] - EMEA RevPAR rose 6%, while Southeast Asia and the Pacific Rim posted 8% growth [8] - In China, RevPAR declined 8% year over year due to pricing pressure [8] Company Strategy and Development Direction - The company focuses on growing its system and supporting franchisees, with a record first quarter for room additions [14][20] - The strategy includes prioritizing development in higher fee par geographies and expanding direct franchising [18] - The company aims to capture trade down demand from both leisure and business travelers seeking value [12] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the summer travel months despite current uncertainties [10][40] - The outlook for full year constant currency global RevPAR is revised to range between down 2% to up 1% [25][26] - Management highlighted the resilience of their business model, which is asset-light and designed to perform through economic cycles [29] Other Important Information - The company returned nearly $110 million to shareholders through share repurchases and dividends [7][24] - Wyndham was named one of the world's most ethical companies for the third straight year [20] Q&A Session Summary Question: Changes in U.S. RevPAR outlook - Management noted that normalized April demand improved, with RevPAR running about a full point ahead of the prior year [38][39] - They expect leisure transient demand to pick up into the summer months, with pricing holding firm [40][41] Question: Long-term outlook and sensitivities - Management confirmed that the long-term growth algorithm remains intact, with net room growth expected to continue [50][52] Question: Development backdrop and conversion business - Management expressed confidence in the development pipeline, with a significant increase in new construction openings [60][62] Question: Trends in infrastructure and macro impact - Management noted a slight slowdown in infrastructure demand but expects continued growth driven by federal allocations [102][106] Question: Ancillary revenue growth expectations - Management continues to expect low teen growth for ancillary revenues, driven by contract-based income [96][97]
Wyndham Hotels & Resorts(WH) - 2025 Q1 - Earnings Call Transcript
2025-05-01 12:30
Financial Data and Key Metrics Changes - Adjusted EBITDA grew 9% on a comparable basis and adjusted EPS increased 20% [5][21] - Global RevPAR grew 2% in constant currency, with U.S. RevPAR starting strong but softening in February and March [6][8] - Free cash flow was $80 million, converting from adjusted EBITDA at approximately 55% [22] - The company returned nearly $110 million to shareholders through share repurchases and dividends [6][22] Business Line Data and Key Metrics Changes - Fee-related and other revenues increased by $12 million year over year, driven by a 9% increase in royalties and franchise fees [21] - Ancillary revenue growth was primarily driven by higher credit card and partnership fees [21][18] - The company opened 15,000 rooms, a 13% increase from the previous year, and signed 6% more deals than a year ago [14][15] Market Data and Key Metrics Changes - Latin America RevPAR grew by 25% excluding Argentina's hyperinflation, while EMEA RevPAR rose 6% [7] - International RevPAR grew in all regions except China, where it declined by 8% year over year [7] - U.S. RevPAR is expected to decline about 3% for the remainder of the year based on recent trends [24][42] Company Strategy and Development Direction - The company focuses on growing its system and supporting franchisees, with a strategic emphasis on higher fee par hotels [12][17] - The development pipeline reached a record 254,000 rooms, with a significant increase in net room growth across all regions [14][15] - The company is prioritizing development in higher RevPAR markets and is selective about capital deployment [72][73] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the resilience of their business model during economic downturns, citing historical outperformance [10][11] - The outlook for 2025 has been refined to reflect a more cautious view of industry-wide RevPAR performance, with expectations ranging from down 2% to up 1% [24][25] - Management noted that consumer sentiment is currently weighing on leisure occupancy, but there are signs of positive momentum as summer approaches [41][42] Other Important Information - The company was named one of the world's most ethical companies for the third consecutive year [19] - The company continues to invest in technology innovations to enhance service and operational efficiency [109] Q&A Session Summary Question: Can you elaborate on the changes in the U.S. RevPAR outlook? - Management noted that normalized April demand improved, with RevPAR running about a full point ahead of the prior year, indicating potential for a positive summer [35][36] Question: What is the long-term outlook for net room growth? - Management reaffirmed a long-term net room growth outlook of 3% to 5%, with a record first quarter in room openings and strong signings [47][49] Question: How is the company managing development costs amid rising prices? - Management highlighted efforts to shift sourcing closer to home and negotiate with suppliers to mitigate cost increases, particularly in construction materials [61][62] Question: What is the outlook for ancillary revenue growth? - Management continues to expect low teen growth for ancillary revenues, driven by contract-based income and a strong co-branded credit card program [92][94] Question: How is the company addressing infrastructure demand? - Management reported a steady demand for infrastructure-related travel, with expectations for continued growth driven by federal spending on infrastructure projects [100][102]
Compared to Estimates, Wyndham (WH) Q1 Earnings: A Look at Key Metrics
ZACKS· 2025-04-30 23:35
Financial Performance - Wyndham Hotels reported $316 million in revenue for Q1 2025, a year-over-year increase of 3.6% [1] - The EPS for the same period was $0.86, compared to $0.78 a year ago, reflecting a surprise of +4.88% against the consensus estimate of $0.82 [1] Key Metrics - Total Rooms stood at 907,200, slightly below the estimated 909,030 [4] - Total RevPAR was $36.13, compared to the average estimate of $36.76 [4] - Fee-related and other revenues from royalties and franchise fees were $126 million, exceeding the average estimate of $119.61 million, marking an 8.6% year-over-year increase [4] - Marketing, reservation, and loyalty revenues were $116 million, slightly below the estimate of $121.16 million, showing a year-over-year decrease of 0.9% [4] - Management and other fees were reported at $2 million, in line with the average estimate of $2.20 million, with no year-over-year change [4] - License and other fees reached $27 million, close to the estimate of $27.90 million, reflecting a year-over-year increase of 3.9% [4] - Other fee-related revenues were $45 million, slightly above the estimate of $44.84 million, representing a year-over-year increase of 4.7% [4] Stock Performance - Wyndham's shares have returned -5.4% over the past month, compared to the Zacks S&P 500 composite's -0.2% change [3] - The stock currently holds a Zacks Rank 3 (Hold), indicating potential performance in line with the broader market in the near term [3]
Wyndham Hotels (WH) Q1 Earnings Top Estimates
ZACKS· 2025-04-30 23:01
Wyndham Hotels (WH) came out with quarterly earnings of $0.86 per share, beating the Zacks Consensus Estimate of $0.82 per share. This compares to earnings of $0.78 per share a year ago. These figures are adjusted for non-recurring items.This quarterly report represents an earnings surprise of 4.88%. A quarter ago, it was expected that this hotel and resort chain would post earnings of $1 per share when it actually produced earnings of $1.04, delivering a surprise of 4%.Over the last four quarters, the comp ...
Wyndham Hotels & Resorts(WH) - 2025 Q1 - Earnings Call Presentation
2025-04-30 21:19
Wyndham Hotels & Resorts Business Model and Performance - Wyndham Hotels & Resorts operates with an asset-light, highly scalable, and fully franchised model[6], with over 99% of their hotels being franchised[7] - The company boasts high operating leverage, achieving an Adjusted EBITDA Margin of 83% in FY 2024[8] - Wyndham generates strong, recurring free cash flow, converting approximately 57% of Adjusted EBITDA into Adjusted Free Cash Flow in 2024, equating to $397 million from an Adjusted EBITDA of $694 million[10] - The company has returned approximately $2.5 billion of capital to shareholders since its spin-off, representing about 42% of its market capitalization at the time of the spin-off, including $109 million in Q1 2025[40] Growth and Pipeline - Wyndham's global system size has shown consistent net room growth, with a 4% increase year-over-year as of January 1, 2025[30] - The company's global pipeline has expanded to approximately 254,000 rooms across approximately 2,140 hotels as of March 31, 2025, marking the 19th consecutive quarter of sequential growth[33] - The global pipeline is composed of 77% new construction and 23% conversions[33] 2025 Outlook and Priorities - The company projects system-wide room growth between 3.6% and 4.6% in 2025[46] - Wyndham anticipates Adjusted EBITDA growth of 5-7% on a comparable basis in 2025, projecting an Adjusted EBITDA between $730 million and $745 million[49] - The company expects to return approximately $130 million to shareholders through dividends in 2025[49]
Wyndham Hotels & Resorts(WH) - 2025 Q1 - Quarterly Results
2025-04-30 20:31
WYNDHAM HOTELS & RESORTS REPORTS STRONG FIRST QUARTER RESULTS Company Delivers Record First Quarter Openings and Development Pipeline PARSIPPANY, N.J., April 30, 2025 - Wyndham Hotels & Resorts (NYSE: WH) today announced results for the three months ended March 31, 2025. Highlights include: "We delivered a solid start to the year with strong system growth, record first-quarter openings and continued expansion across every region," said Geoff Ballotti, president and chief executive officer. "While the macro ...
WYNDHAM HOTELS & RESORTS REPORTS STRONG FIRST QUARTER RESULTS
Prnewswire· 2025-04-30 20:30
Core Insights - Wyndham Hotels & Resorts reported strong first-quarter results for 2025, achieving record openings and a robust development pipeline despite macroeconomic uncertainties [1][2][3] - The company’s asset-light, franchise-only business model has shown resilience during economic downturns, positioning it for long-term shareholder value [1] System Size and Development - As of March 31, 2025, Wyndham's global system comprised 907,200 rooms, reflecting a 4% year-over-year growth [2] - The U.S. system grew to 502,600 rooms, a 1% increase, while international rooms reached 404,600, a 7% increase [2][31] - The development pipeline included approximately 2,140 hotels and 254,000 rooms, marking a 5% year-over-year increase [3][6] Revenue Performance - Global RevPAR increased by 2% in constant currency, with U.S. RevPAR at $42.37 (up 2%) and international RevPAR at $28.73 (up 3%) [3][5] - Fee-related and other revenues grew by 4% year-over-year to $316 million, driven by higher royalties and franchise fees [15][25] Financial Results - Net income for the first quarter was $61 million, compared to $16 million in the prior year, with adjusted net income increasing by 5% to $67 million [15][25] - Adjusted EBITDA rose by 3% year-over-year to $145 million, reflecting higher fee-related revenues and margin expansion [15][25] - Diluted earnings per share increased to $0.78 from $0.19 in the prior year, with adjusted diluted EPS growing 10% to $0.86 [15][25] Shareholder Returns - The company returned $109 million to shareholders through share repurchases of $76 million and quarterly cash dividends of $0.41 per share [13][15] - During the first quarter, approximately 797,000 shares were repurchased [13] Outlook for 2025 - The company refined its full-year outlook, anticipating a softer RevPAR environment, with global RevPAR growth projected between -2% and 1% [14][39] - The net room growth outlook remains at 3.6% to 4.6% for the full year [16][39]
La Quinta by Wyndham Opens its Doors in Beautiful Batumi, Georgia
Prnewswire· 2025-04-28 12:00
Industry Overview - Georgia's tourism industry is experiencing significant growth, with 7.4 million international visitors in 2024, representing a 4.2% increase from the previous year [1] - Batumi is highlighted as a leading travel hotspot due to its attractive Black Sea coastline and vibrant atmosphere [1] Company Expansion - Wyndham Hotels & Resorts is expanding its presence in Georgia, introducing the La Quinta by Wyndham brand to tap into the growing tourism market [2] - The La Quinta by Wyndham Batumi hotel is strategically located near Batumi Beach and the international airport, enhancing its appeal to travelers [2] Hotel Features - La Quinta by Wyndham Batumi features 98 rooms, including various types such as king and twin rooms, catering to diverse traveler needs [3] - The hotel offers amenities like on-site parking, a 24/7 fitness center, wellness facilities, an international restaurant, and a bar [3] Strategic Vision - Wyndham's commitment to the Georgian market is part of a broader EMEA growth strategy, recognizing the long-term potential of the region [2] - The hotel aims to provide a premium experience that aligns with the expectations of international travelers [4] Brand Recognition - La Quinta by Wyndham is part of a global portfolio of over 900 hotels, known for its quality service and guest experience [4] - Wyndham Hotels & Resorts is the largest hotel franchising company globally, with approximately 9,300 hotels across over 95 countries [6]