Hilton Grand Vacations (HGV) Q2 2025 Earnings Call July 31, 2025 11:00 AM ET Company ParticipantsMark Melnyk - SVP - IRMark Wang - CEO & DirectorDan Mathewes - President & CFOBrandt Montour - Director - Equity ResearchC. Patrick Scholes - Managing Director - Lodging & Leisure Equity ResearchConference Call ParticipantsBen Chaiken - Equity AnalystStephen Grambling - MD & Senior Equity Research AnalystOperatorGood morning, and welcome to the Hilton Grand Vacations Second Quarter twenty twenty five Earnings Co ...

Financial Data and Key Metrics Changes - The company reported record highest ever consolidated net revenue results in the second quarter of 2025, driven by a diverse portfolio and global presence [6][7][17] - BetMGM North America raised full year 2025 guidance for the second time, implying an EBITDA turnaround of nearly $400 million compared to last year [8][19] - Adjusted EBITDAR in Las Vegas declined by $72 million, primarily due to the MGM Grand's room remodel and midweek performance issues [21][22] Business Line Data and Key Metrics Changes - BetMGM North America saw a 36% increase in revenue from operations, with iGaming growing 29% and sports betting top line growing 56% [18][19] - MGM Digital, excluding BetMGM North America, grew its top line by 14%, with expectations of over $150 million in EBITDA enhancements in 2025 [24][25] - MGM China achieved record adjusted EBITDAR and market share of 16.6%, with a focus on premium mass players [11][12][23] Market Data and Key Metrics Changes - Las Vegas experienced record table games and slot volumes, but the adjusted EBITDAR decline was isolated to specific properties [9][20] - MGM China reported a 3% increase in adjusted EBITDAR, with strong performance across all business segments [23] - Regional properties achieved record high net revenues, demonstrating stability during volatile times [12] Company Strategy and Development Direction - The company aims to be the world's premier gaming entertainment company, leveraging its unmatched portfolio diversity to drive growth [6][7][27] - MGM is focused on capitalizing on significant near-term catalysts in BetMGM and Las Vegas, as well as mid to long-term catalysts in MGM Digital and development projects [7][8][14] - The company is positioned to benefit from major events in Las Vegas, including the new MLB stadium and ongoing renovations at the Las Vegas Convention Center [9][10][28] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about restoring growth in Las Vegas during the fourth quarter, supported by positive bookings and convention activity [22][50] - The company remains confident in its ability to attract premium customers despite challenges in the value-oriented segment [91][92] - Management highlighted the importance of maintaining a strong balance sheet while pursuing growth opportunities in international markets [17][29] Other Important Information - The company repurchased 8 million shares for $217 million, with board approval for an additional $2 billion in share repurchases [25][26] - MGM's exclusive relationship with Marriott is driving higher quality customer bookings, with a significant increase in room nights booked [10][44] - The company is actively working on legislative issues related to tax impacts on the gaming community [65][66] Q&A Session Summary Question: Impact of MGM Grand disruption - The estimated impact remains at $65 million, with about $40 million experienced in the first six months [34] Question: Pricing and value concerns in Vegas - Luxury products are performing well, with ADR up 4%, while value-oriented properties are facing challenges [36][37] Question: Digital business cross benefits - Significant growth in Nevada monthly actives and strong player engagement are noted, with a focus on omnichannel advantages [41] Question: Update on Bonvoy arrangement - The partnership is on track, with over 900,000 room nights expected this year and positive customer spending trends [43] Question: Visitation decline on the Strip - International visitation has been an issue, but premium customer attraction remains strong [90][91] Question: Dividend policy at MGM China - A new dividend policy of 50% of distributable net income has been approved, providing substantial cash flow for MGM Resorts [60][61] Question: Buyback strategy amidst growth pipeline - The company is cautious with share repurchases due to its development pipeline but remains within leverage targets [70][71]

Financial Data and Key Metrics Changes - The company reported Q1 RevPAR of $178, representing a modest 70 basis point decline year-over-year, primarily due to difficult comparisons from last year's nearly 8% growth [19][22] - Total hotel revenues for the quarter were $608 million, with hotel adjusted EBITDA at $151 million, resulting in a nearly 25% hotel adjusted EBITDA margin [20][21] - Adjusted EBITDA for the quarter was $144 million, and adjusted FFO per share was $0.46 [21] Business Line Data and Key Metrics Changes - The Bonnet Creek complex in Orlando saw a 32% RevPAR increase, driven by a surge in transient revenues of nearly 65% [12] - Casa Marina in Key West reported a 12% RevPAR increase, despite tough comparisons from last year [13] - RevPAR across the two Hawaii properties declined by 15% during the quarter, with the Hilton Hawaiian Village being a significant drag on overall results [14] Market Data and Key Metrics Changes - Miami, New Orleans, Puerto Rico, Washington DC, and San Francisco reported above industry average RevPAR gains [8] - Preliminary April results showed mixed performance, with RevPAR growth of 1.6%, driven by strong gains in New York, Orlando, and San Francisco [16] - International demand represents just 10% of total room nights, with government-related business accounting for only 3% [17] Company Strategy and Development Direction - The company plans to invest $310 million to $330 million in capital improvements in 2025, focusing on unlocking embedded value in its portfolio [10] - A transformative renovation of the Royal Palm South Beach is set to begin, with expected returns exceeding 15% to 20% [9] - The company aims to sell $300 million to $400 million of non-core hotels this year to further deleverage the balance sheet [11] Management's Comments on Operating Environment and Future Outlook - Management expressed cautious optimism regarding the recovery of the Hilton Hawaiian Village, expecting mid-single-digit RevPAR growth in Q3 [31] - The near-term outlook for US lodging fundamentals remains uncertain due to ongoing global trade tensions [16] - Despite macro uncertainties, the company remains focused on factors within its control and is working closely with operators to manage expenses [17] Other Important Information - The company repurchased approximately 3.5 million shares for a total of $45 million during the quarter [11] - A $70 million impairment was recognized during the quarter related to an asset, though specific details were not disclosed [77][78] Q&A Session Summary Question: Comments on planned asset sales and current market conditions - Management acknowledged tremendous uncertainty in the market due to geopolitical factors but expressed confidence in their ability to transact even under challenging conditions [27][28] Question: Insights on Hawaii's performance and recovery - Management indicated that the ramp-up post-strike is taking longer than expected, but they remain confident in Hawaii's long-term growth potential [32][33] Question: Update on core hotel portfolio and asset sales - The company is focusing on its top 20 core assets, which account for 85-90% of the company's value, while working to sell non-core assets [38][39] Question: CapEx plans and timing for Miami renovations - Management confirmed that they have secured necessary permits and are on track to complete renovations before the World Cup next year [43] Question: Market performance expectations for 2025 - Management expects strong performance in Orlando and Key West, with positive outlooks for New York and Denver as well [50][51] Question: Group pace and transient demand trends - Management noted that group bookings remain solid, while transient demand is showing some softness, particularly in international travel [108]

Financial Data and Key Metrics Changes - Reported contract sales increased by 10% to $721 million, and adjusted EBITDA was $248 million with margins excluding reimbursements at 22% [13][23] - Total revenue excluding cost reimbursements grew by 11% to $1.1 billion [23] - Adjusted free cash flow for the quarter was $185 million, with a cash flow conversion rate of 75% [29][30] Business Line Data and Key Metrics Changes - Contract sales in the real estate business were $721 million, up 10% year-over-year, with VPG growing 15% to over $4,100 [24] - Rental and ancillary revenues reached $187 million, with a segment loss of $19 million due to elevated expenses [28] - Financing business revenue was $125 million, with segment profit at $70 million and margins of 56% [25] Market Data and Key Metrics Changes - Occupancy rate remained flat at 77%, with consolidated arrivals in the second quarter ahead of the prior year [14] - The marketing package pipeline was robust with over 725,000 packages, indicating solid booking growth [14] - Member count was 725,000 at the end of the quarter, with a net owner growth (NOG) of just under 1% [15][28] Company Strategy and Development Direction - The company is focused on enhancing lead generation, execution, and product enhancements to support EBITDA and cash flow goals [17][18] - Integration with Bluegreen is progressing well, achieving $89 million in cost synergies, with a target of $100 million by year-end [19] - The company maintains a disciplined approach to process and execution while adapting to macroeconomic volatility [10][20] Management's Comments on Operating Environment and Future Outlook - Management acknowledged increased macroeconomic volatility but emphasized the company's strong fundamentals and proactive initiatives [10][12] - The company is maintaining its EBITDA guidance for the year, expecting to navigate through potential uncertainties effectively [12][31] - Management expressed confidence in the demand for experiences over goods, which may continue to grow despite economic challenges [86] Other Important Information - The company repurchased $150 million worth of stock during the quarter, with a commitment to continue capital returns [30] - The liquidity position included $259 million in unrestricted cash and $870 million available under the revolving credit facility [32] Q&A Session Summary Question: Consumer behavior and forward bookings - Management noted no material changes in forward bookings, attributing stability to the prepaid nature of owner and package sales [35][37] Question: New owner mix versus owned mix - Management indicated that the mix is controllable and expects continued strong performance despite seasonal shifts [39][40] Question: Balance sheet optimization - Management clarified that a portion of unsecuritized receivables is not immediately securitizable but has a path for future securitization [46][50] Question: VPG performance and Bluegreen customer upgrades - Management reported strong VPG growth across all segments, particularly among Bluegreen owners, with significant outperformance [53] Question: KPIs and growth expectations - Management expects mid to higher single-digit VPG growth for the remainder of the year, despite some challenges in tour flow [60] Question: Strategic initiatives for financing and engagement - Management is standardizing financing programs and enhancing value propositions to drive engagement and performance [64][68]

Travel + Leisure (TNL) Q1 2025 Earnings Call April 23, 2025 08:30 AM ET Company Participants Michael Hug - Chief Financial OfficerMichael Brown - CEO, President & DirectorDavid Katz - Managing DirectorC. Patrick Scholes - Managing Director - Lodging & Leisure Equity ResearchDany Asad - DirectorLizzie Dove - Vice President Equity ResearchStephen Grambling - Managing Director Conference Call Participants Chris Woronka - AnalystBenjamin Chaiken - Equity AnalystBrandt Montour - Director, Equity Research Analyst ...