Wyndham Hotels & Resorts(WH) - 2024 Q2 - Quarterly Results

Financial Performance - Adjusted EBITDA rose by 13% year-over-year to $178 million, with adjusted diluted EPS increasing by 22% to $1.13[2][10] - Net income for the second quarter was $86 million, a 23% increase compared to the prior-year quarter[2][10] - Net revenues for Q2 2024 were $367 million, a slight increase from $362 million in Q2 2023, while net revenues for the first half of 2024 totaled $671 million, down from $674 million in the same period last year[29] - Operating income for Q2 2024 was $145 million, compared to $123 million in Q2 2023, indicating a year-over-year increase of approximately 17.9%[29] - Net income for Q2 2024 was $86 million, up from $70 million in Q2 2023, representing a growth of 22.9%[29] - Adjusted EBITDA for the first half of 2024 was $141 million, compared to $147 million in the first half of 2023, reflecting a decrease of 4.1%[32] - The company reported a basic earnings per share of $1.07 for Q2 2024, up from $0.82 in Q2 2023, reflecting a growth of 30.5%[29] - Net income for the six months ended June 30, 2024, was $102 million, compared to $137 million for the same period in 2023, reflecting a decrease of 25.6%[51] - Adjusted net income for the three months ended June 30, 2024, was $91 million, an increase from $80 million in 2023, marking a growth of 13.8%[51] Development and Growth - System-wide rooms grew by 4% year-over-year, with over 18,000 rooms opened globally, including a 16% increase in the U.S.[2] - The development pipeline reached a record 245,000 rooms, reflecting a 7% year-over-year increase and a 33% rise in awarded contracts[2][4] - Approximately 70% of the development pipeline is in the midscale and above segments, which grew 4% year-over-year[4] - The global room count increased by 33,400 rooms, reaching 884,900 as of June 30, 2024, representing a 4% growth year-over-year[41] - The company added 31,200 rooms globally in the first half of 2024, a 11% increase from the previous year[41] - The total international room count increased by 29,100 rooms, reaching 385,500 as of June 30, 2024, an 8% growth year-over-year[41] - The number of rooms is expected to grow by 3% to 4% year-over-year[53] Cash Flow and Shareholder Returns - The company generated adjusted free cash flow of $69 million in the second quarter, ending with a cash balance of $70 million[12] - Free cash flow for Q2 2024 was $27 million, down from $92 million in Q2 2023, indicating a decline of 70.7%[35] - The company returned $162 million to shareholders through share repurchases and dividends, with $131 million allocated for share buybacks[2][15] - The adjusted free cash flow conversion rate is anticipated to be approximately 60%[53] Debt and Financial Outlook - Total debt increased to $2.427 billion as of June 30, 2024, from $2.201 billion at the end of 2023, marking an increase of approximately 10.3%[36] - The net debt leverage ratio increased to 3.5x as of June 30, 2024, compared to 3.2x at the end of 2023[38] - The company successfully repriced its Term Loan B Facility, reducing the interest rate by 60 basis points to SOFR plus 1.75%[2][14] - As of June 30, 2024, total outstanding debt amounts to $2.427 billion, with $1.445 billion maturing thereafter[39] - Full-year 2024 adjusted diluted EPS outlook is refined to $4.20 - $4.32, with adjusted net income expected between $338 million and $348 million[16] - The company projects adjusted net income for 2024 to be between $338 million and $348 million, with adjusted diluted EPS expected to range from $4.20 to $4.32[53] - Adjusted EBITDA for 2024 is forecasted to be between $690 million and $700 million[53] - The outlook for fee-related and other revenues in 2024 is estimated to be between $1,410 million and $1,430 million[53] - The company’s capital expenditures for 2024 are projected to be approximately $40 million[53] Revenue Per Available Room (RevPAR) - Global RevPAR increased by 2% in constant currency, with U.S. RevPAR remaining flat and international RevPAR growing by 7%[4] - For the three months ended June 30, 2024, the total RevPAR for the United States was $55.44, showing no percentage change compared to the previous year[43] - International RevPAR for the three months ended June 30, 2024, was $34.11, reflecting a 7% increase year-over-year[43] - The company experienced a 39% increase in RevPAR in Latin America for the six months ended June 30, 2024, reaching $50.41[43] - The average royalty rate for the United States increased by 9 basis points to 4.7%, while the global average rose by 4 basis points to 4.0%[43] Other Expenses - The company incurred payments related to hostile takeover defense amounting to $46 million in the first half of 2024[34] - Total adjustments before tax for the six months ended June 30, 2024, amounted to $72 million, significantly higher than $24 million in the same period of 2023[51]