Wyndham Hotels & Resorts(US:WH)2025-10-23 18:41Revenue and Income - Net revenues for the three months ended September 30, 2025 decreased by $14 million, or 4%, primarily due to lower royalty and franchise fees[126] - Operating income for the three months ended September 30, 2025 increased by $7 million, or 4%, compared to the prior year[126] - Net income for the three months ended September 30, 2025 increased by $3 million, or 3%, compared to the prior year[129] - For the nine months ended September 30, 2025, net revenues increased by $28 million, or 3%, driven by higher ancillary revenues from the co-branded credit card program[133] - Net income for the nine months ended September 30, 2025, increased by $49 million, or 24%, compared to the prior year period[138] - Adjusted EBITDA for the nine months ended September 30, 2025, increased by $25 million, or 4%, compared to the prior year period[140] Expenses and Costs - Marketing, reservation, and loyalty expenses decreased by $18 million, or 12%, compared to the prior year[126] - Total expenses for the nine months ended September 30, 2025, decreased by $44 million, or 6%, compared to the prior year period[134] - Interest expense, net for the three months ended September 30, 2025 increased by $2 million, or 6%, due to a higher average debt balance[128] - Interest expense, net for the nine months ended September 30, 2025, increased by $10 million, or 11%, primarily due to a higher average debt balance[135] - Restructuring expenses incurred during the nine months ended September 30, 2025, totaled $16 million, impacting 178 employees[143] Development and Growth - Total rooms increased by 4% year-over-year, with a 1% growth in the U.S. and a 9% growth internationally[121] - The global development pipeline consisted of approximately 2,180 hotels and 257,000 rooms, representing a 4% year-over-year increase[142] - The company awarded 204 new contracts during the third quarter of 2025, an increase of 24% year-over-year[142] Assets and Liabilities - Total assets increased by $123 million to $4,346 million as of September 30, 2025, primarily due to an increase in accounts receivable and development advance notes[148] - Total liabilities rose by $190 million to $3,763 million, mainly driven by a $164 million increase in outstanding debt[148] - Total stockholders' equity decreased by $67 million to $583 million, primarily due to $223 million in stock repurchases and $96 million in declared dividends[148] Cash Flow and Liquidity - Net cash provided by operating activities increased by $59 million to $215 million compared to the prior year, attributed to the absence of payments related to a hostile takeover attempt in 2024[158] - Total liquidity increased to $790 million following an amendment and extension of the revolving credit facility in October 2025[153] - Capital expenditures for the nine months ended September 30, 2025, amounted to $30 million, with an anticipated total of $40-45 million for the year[161] - The company invested $73 million in development advance notes during the nine months ended September 30, 2025, expecting to invest approximately $110 million for the full year[162] - Approximately 2.5 million shares were repurchased at an average price of $87.70, costing $223 million during the nine months ended September 30, 2025[165] - Cash dividends declared were $0.41 per share in the first three quarters of 2025, totaling $96 million[166] Tax and Interest Rates - The effective tax rate for the three months ended September 30, 2025 was 26.1%, compared to 25.5% in the prior year[128] - The effective tax rate for the nine months ended September 30, 2025, was 24.5%[136] - A one-point change in underlying interest rates would result in approximately a $7 million increase or decrease in annual interest expense[177] - 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[177] Foreign Currency and Market Risk - The company has foreign currency rate exposure to fluctuations in several currencies, including the Canadian Dollar, Chinese Yuan, Euro, Brazilian Real, British Pound, and Argentine Peso[179] - The absolute notional amount of outstanding foreign exchange hedging instruments was $295 million as of September 30, 2025[180] - A hypothetical 10% change in foreign currency exchange rates would have resulted in approximately a $9 million increase or decrease to the fair value of outstanding forward foreign currency exchange contracts[181] - Total net exposure in Argentina relating to foreign currency was approximately $8 million as of September 30, 2025[182] - The company incurred $1 million of foreign currency exchange losses associated with highly inflationary economies during the nine months ended September 30, 2024[182] - The company's total market risk is influenced by market volatility and liquidity, with limitations in sensitivity analyses due to single-point time constraints[183]