Marriott Vacations Worldwide(VAC) - 2023 Q4 - Annual Results

Financial Performance - Consolidated Vacation Ownership contract sales for Q4 2023 were $447 million, a 2% decline year-over-year, but would have increased by 4% excluding the impact of the Maui wildfires[6] - Net income attributable to common stockholders for Q4 2023 was $35 million, with adjusted net income of $75 million, resulting in adjusted fully diluted earnings per share of $1.88[6] - Adjusted EBITDA for Q4 2023 was $186 million, which would have been $210 million without the estimated impact of the Maui wildfires[6] - Total revenues for Q4 2023 were $1,194 million, a slight increase of 0% from $1,188 million in Q4 2022[27] - Adjusted net income attributable to common stockholders for the fiscal year 2023 was $322 million, a decrease of 30% from $458 million in 2022[27] - Net income attributable to common stockholders for the twelve months was $254 million, down 38% from $391 million in the prior year[35] - Earnings per share (EPS) for common stockholders decreased to $6.96 from $9.69, reflecting a decline of 28.2%[35] - The company reported a net income of $199 million for the three months ended December 31, 2023, compared to $18 million in the same period of 2022[38] - Net income attributable to common stockholders for Q4 2023 was $35 million, a decrease of 60% from $88 million in Q4 2022[48] - Adjusted net income attributable to common stockholders for Q4 2023 was $75 million, down 35% from $115 million in Q4 2022[52] Revenue and Sales - Total consolidated contract sales for Q4 2023 were $447 million, a decrease of 2% from $454 million in Q4 2022[27] - Consolidated contract sales for the year reached $1,772 million, down from $1,837 million in the previous year, with net sales after resales at $1,730 million[45] - The vacation ownership products segment generated revenues of $1,460 million, a decrease of 39 million compared to $1,618 million in the previous year[35] - The management and exchange segment reported revenues of $813 million, slightly down from $827 million[35] - Total revenues for the twelve months ended December 31, 2023, were $4,727 million, a decrease of 1.5% from $4,656 million in the previous year[35] - Total revenues for the quarter were $1,113 million, a decrease of 12% compared to the previous year, resulting in adjusted revenues of $1,101 million[41] Expenses and Costs - Total expenses increased to $4,191 million, up 8.2% from $3,872 million in the previous year[35] - General and administrative costs increased by $22 million in Q4 2023, primarily due to higher IT spending for digital and data initiatives[13] - The company incurred transaction and integration costs of $37 million for the twelve months ended December 31, 2023[35] - Cost of vacation ownership products for the year was $224 million, down from $289 million in the previous year, contributing to improved profitability[45] - The company experienced a decrease in marketing and sales expenses, totaling $205 million for the quarter, compared to $204 million in the previous year[42] Liquidity and Cash Flow - The company ended 2023 with $929 million in liquidity, including $248 million in cash and cash equivalents[14] - Total cash and cash equivalents decreased to $248 million in FY 2023 from $524 million in FY 2022[59] - The company reported a net change in cash, cash equivalents, and restricted cash of $(280) million in 2023, compared to an increase of $51 million in 2022[61] - In fiscal year 2023, cash provided by operating activities was $232 million, a decrease of 55.6% compared to $522 million in 2022[61] Future Outlook - For full year 2024, the company expects contract sales between $1.88 billion and $1.93 billion, with net income attributable to common stockholders projected between $285 million and $320 million[17] - The company anticipates leveraging technology to enhance core operations and improve contract sales in 2024[24] - Future risks include potential impacts from health crises, economic volatility, and global supply chain disruptions[24] - For fiscal year 2024, adjusted net income attributable to common stockholders is projected to be between $305 million and $335 million, with adjusted earnings per share expected to range from $7.65 to $8.35[63] - Adjusted EBITDA for fiscal year 2024 is forecasted to be between $760 million and $800 million, reflecting adjustments for anticipated transaction costs and litigation charges[65] - The company anticipates free cash flow for fiscal year 2024 to be between $352 million and $390 million, with adjusted free cash flow projected to range from $400 million to $450 million[68] Member and Revenue Metrics - Interval International had 1.6 million active members at the end of 2023, with average revenue per member increasing by 2% year-over-year in Q4[11] - Average revenue per Interval International member increased by 2% to $36.16 in Q4 2023 from $35.60 in Q4 2022[27] - Total active Interval International members remained stable at 1,564,000, unchanged from the previous year[27] - The total active international members at the end of 2023 was 1.564 million, a slight decrease from 1.566 million in 2022[71] - Average revenue per Interval International member in 2023 was $156.65, down from $157.97 in 2022, indicating a decline of 0.84%[71] Adjusted Financial Metrics - The company provided As Adjusted results for the three- and twelve-month periods ended December 31, 2022, to facilitate comparison of ongoing core operations[83] - As Adjusted results exclude impacts from the Alignment on both GAAP and non-GAAP financial measures[83] - The company believes that As Adjusted results assist with period-over-period comparisons of ongoing operations[83] - The focus on As Adjusted results aims to present a clearer picture of the company's performance excluding the Alignment's effects[83] - The company emphasizes the usefulness of As Adjusted information for stakeholders analyzing operational trends[83] - The financial data presented is intended to enhance understanding of the company's core business performance[83] - The Alignment's impact is specifically noted as a factor that could distort reported results[83] - The company aims to provide transparency in its financial reporting through the As Adjusted metrics[83] - The emphasis on ongoing operations reflects the company's strategy to highlight sustainable performance[83] - The results are part of the company's commitment to accurate and informative financial disclosures[83]