Financial Data and Key Metrics Changes - In 2025, the company achieved revenue of $4.02 billion, an increase of 4% year-over-year, and EBITDA of $990 million, up 7% year-over-year [17][18] - The fourth quarter revenue was $1.026 billion, with EBITDA of $272 million, reflecting an 8% year-over-year growth [15][18] - Earnings per share (EPS) for the year was $6.34, representing a 10% increase year-over-year [17][18] Business Line Data and Key Metrics Changes - The Vacation Ownership segment saw gross sales rise by 8% year-over-year, driven by a 5% increase in tour flow in the fourth quarter, the strongest level of the year [16][18] - The Travel and Membership segment reported fourth quarter revenue of $148 million, down 6% year-over-year, with EBITDA of $47 million, down 10% [17][18] Market Data and Key Metrics Changes - The company noted strong leisure demand as a key driver for its Vacation Ownership business, with a loyal owner base contributing to predictable cash flow [6][8] - The average FICO score for new originations remained above 740, indicating high-quality loans [17][18] Company Strategy and Development Direction - The company is focused on brand expansion and optimizing its resort portfolio to drive sustainable, profitable growth [6][7] - A Resort Optimization Initiative is underway, which involves closing lower-performing resorts and replacing them with higher-demand properties [12][21] - The company aims to enhance owner experiences through technology investments and partnerships, such as those with Live Nation and Authentic Brands [11][62] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the strong demand for leisure travel and the company's ability to deliver another year of revenue growth and EBITDA margin expansion in 2026 [14][26] - The company expects EBITDA for 2026 to be in the range of $1.03 billion to $1.055 billion, reflecting 4%-7% year-over-year growth [14][24] Other Important Information - The company returned $449 million to shareholders in 2025 through dividends and share repurchases, with a new $750 million share repurchase authorization approved [19][20] - The company is committed to maintaining a disciplined capital allocation strategy while investing in organic growth [20] Q&A Session Summary Question: Can you elaborate on the optimization initiative and its long-term impact on EBITDA? - Management indicated that 2025 was a catch-up year for the optimization initiative, with expectations for a return to normal growth in subsequent years [30][31] Question: How is the consumer demographic performing currently? - Management noted continued strong demand from consumers, with household incomes above $100,000 and improved FICO scores, reinforcing the value of vacation experiences [39][40] Question: What are the expectations for the Travel and Membership business moving forward? - Management expects the Travel and Membership segment to follow a consistent trend with disciplined cost management, contributing to EBITDA growth [93] Question: What is the anticipated loan loss provision for 2026? - Management expects the loan loss provision to decrease to around 20%, with a long-term goal of settling into the high teens [90][91] Question: Can you provide insights on the new brand launches and their expected contributions? - Management anticipates that new brands like Sports Illustrated and Eddie Bauer will grow as a percentage of overall sales, contributing positively to future growth [72][74]

Financial Data and Key Metrics Changes - In 2025, the company achieved revenue of $4.02 billion, an increase of 4% year-over-year, and EBITDA of $990 million, reflecting a 7% growth [17][18] - The fourth quarter revenue was $1.026 billion, with EBITDA of $272 million, marking an 8% year-over-year increase [15][16] - Earnings per share (EPS) for the year was $6.34, up 10% from the previous year [18] Business Line Data and Key Metrics Changes - The Vacation Ownership segment saw gross sales rise by 8% year-over-year, driven by a 5% increase in tour flow during the fourth quarter [16][18] - The Travel and Membership segment reported revenue of $148 million in the fourth quarter, down 6% year-over-year, with EBITDA of $47 million, a 10% decline [17] Market Data and Key Metrics Changes - The company noted strong leisure demand continuing into 2026, with early trends in Q1 consistent with expectations [14] - The average volume per guest (VPG) was reported at $3,359, up 6% year-over-year, indicating strong sales execution [16][18] Company Strategy and Development Direction - The company is focused on brand expansion and optimizing its resort portfolio to ensure sustainable growth beyond 2026 [6][7] - A Resort Optimization Initiative is underway, which involves closing underperforming resorts and replacing them with higher-demand properties [12][21] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in delivering another year of revenue growth and EBITDA margin expansion in 2026, with EBITDA expected to be between $1.03 billion and $1.055 billion [14][25] - The company anticipates a continued focus on enhancing owner experiences and leveraging technology to improve operations [11][12] Other Important Information - The company returned $449 million to shareholders in 2025 through dividends and share repurchases, reflecting a commitment to disciplined capital allocation [19][20] - A new $750 million share repurchase authorization was approved, indicating confidence in the company's valuation [20] Q&A Session Summary Question: Can you elaborate on the optimization initiative and its long-term impact on EBITDA? - Management indicated that 2025 was a catch-up year for the optimization initiative, with expectations for a return to normal growth in subsequent years [30][31] Question: How is the consumer demographic performing currently? - Management noted no significant changes in consumer demand, with household incomes rising above $100,000 and improved FICO scores contributing to strong performance [40][41] Question: What are the expectations for the loan loss provision in 2026? - The loan loss provision is expected to decrease to around 20%, with a long-term goal of settling into the high teens [44][92] Question: What is the outlook for the Travel and Membership business? - The Travel and Membership segment is expected to follow a consistent trend with disciplined cost management, contributing to EBITDA growth [94] Question: What is the sales contribution from new brands like Sports Illustrated and Eddie Bauer? - Management anticipates that these new brands will grow to represent a larger percentage of overall sales, with expectations for significant growth in the coming years [73][75]

Core Insights - The travel and leisure sector has seen a surge of over 15% due to better-than-expected earnings and an increase in vacation ownership and spending in Q3, with the stock up approximately 38% year-to-date [1] Company Performance - The company is focused entirely on leisure travel and vacation ownership, with strong brands such as Windom, Accore, Sports Illustrated, and Margaritaville, indicating a robust demand from leisure consumers to continue traveling [2] - Approximately 800,000 members are part of the ownership base, with nearly 80% having already paid for their ownership, which supports ongoing travel demand [3] - The company anticipates strong demand for Q4, supported by a 90-day booking window, reflecting confidence in continued leisure travel [3] Market Trends - Leisure travel has proven to be resilient, as it is one of the last activities consumers give up during economic downturns and one of the first to rebound [4] - High inflation has led consumers to appreciate the value of their ownership, allowing them to enjoy vacations at a fraction of hotel prices [5] - Demand remains consistent across regions, with notable popularity in destinations like the Smoky Mountains, Las Vegas, and Southeast Beach locations [6][7][8] Future Outlook - The company expects 2026 to be a significant year for cruises, indicating a positive outlook for the broader travel industry [8] - Overall, demand remains steady with a preference for drive-to destinations over long-haul flights, reflecting consumer behavior trends [9]

Financial Data and Key Metrics Changes - The company generated over $1 billion in revenue, $250 million in adjusted EBITDA, and $1.65 in adjusted earnings per share, all showing year-over-year increases [6][19] - Adjusted EBITDA grew 2% year-over-year, translating to a 4% adjusted EBITDA growth for the first half of the year [19] - The company returned $107 million of capital to shareholders in the quarter [5][23] Business Line Data and Key Metrics Changes - The Vacation Ownership segment saw revenue grow 6% to $853 million, driven by a 3% increase in tours and a VPG of $3,251, which is up 7% from last year [20] - The Travel and Membership segment's revenue was $166 million, down 6% year-over-year, with adjusted EBITDA declining 11% to $55 million [22] Market Data and Key Metrics Changes - Demand remains strong across the core timeshare business, with tour growth improving sequentially from the first quarter and up 3% compared to 2024 [7] - The average household income for owners is approximately $118,000, with an average FICO score above 720 [10] Company Strategy and Development Direction - The company is focused on growing the core vacation ownership business while leveraging data and technology to enhance customer experience [13] - New brand expansions include a new sales location in Nashville and the launch of the Accor Vacation Club in Asia [14][15] - The company aims to maintain a resilient balance sheet while returning excess cash to shareholders [23] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the strength of the business and the resilience of the customer base, noting that spending on leisure travel is expected to grow mid-single digits per year over the next five years [7][8] - The company anticipates continued challenges in the Travel and Membership segment but remains committed to executing on core business strategies [25] Other Important Information - The company ended the quarter with over $800 million in liquidity, including $212 million in cash and cash equivalents [24] - The company is preparing for the launch of the WorldMark app in Q4 and has invested in AI for personalized experiences [12] Q&A Session Summary Question: Visibility in the Travel and Membership segment - Management acknowledged challenges in the Travel and Membership segment due to industry consolidation and M&A activity impacting transaction volumes [30][31] Question: Average transaction size and financing - The increase in average transaction size is attributed to measured price increases and strong consumer demand, with no significant change in the propensity to finance [35][37] Question: VPG guidance and gross VOI sales - Management raised VPG guidance for the year but did not increase gross VOI sales due to expectations of continued tour growth [41][42] Question: Delinquency trends - Delinquency trends have moderated, and management is confident in the portfolio's strength, with a full-year provision of 21% [43][45] Question: Consumer health and income stratification - Management noted that higher household incomes correlate with better performance and lower delinquencies, with strong engagement from existing owners [52][56] Question: International opportunities with Accor - Management expressed optimism about the international market but emphasized that the U.S. remains the strongest market for timeshare [71][73] Question: New projects and their strategic importance - New projects like Margaritaville and Sports Illustrated are seen as opportunities to reach new customer segments and enhance overall sales [86][88]