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Travel + Leisure Co. Reports Fourth Quarter and Full-Year 2021 Results

Travel + Leisure Co. (NYSE:TNL), the world’s leading membership and leisure travel company, today reported fourth quarter and full-year 2021 financial results for the period ended December 31, 2021.

This press release features multimedia. View the full release here: https://www.businesswire.com/news/home/20220223005484/en/

Travel + Leisure Co. (NYSE:TNL) reports 4Q and FY 2021 results

Travel + Leisure Co. (NYSE:TNL) reports 4Q and FY 2021 results

Fourth quarter 2021 highlights:

  • Net income from continuing operations of $110 million (diluted EPS of $1.26) on net revenue of $870 million
  • Adjusted EBITDA of $228 million and adjusted diluted EPS of $1.19 (1)
  • Resumed stock repurchase program and increased dividend

Full-year 2021 highlights:

  • Net income from continuing operations of $313 million (diluted EPS of $3.58) on net revenue of $3.1 billion
  • Adjusted EBITDA of $778 million and adjusted diluted EPS of $3.65
  • Net cash provided by operating activities of $568 million and adjusted free cash flow of $223 million

Outlook:

  • First quarter 2022 adjusted EBITDA is expected to range from $160 million to $170 million
  • The Company will recommend a first quarter 2022 dividend of $0.40 per share for approval by the Board of Directors

“The continued recovery in leisure travel and business improvements made at the start of the pandemic helped us deliver full-year adjusted EBITDA and adjusted diluted EPS above our guidance range,” said Michael D. Brown, president and CEO of Travel + Leisure Co. “Based on our strong results in 2021 and optimism for the year ahead, we increased the dividend and resumed stock repurchases in the fourth quarter.”

“We anticipate that leisure travel will continue to lead the broader travel industry, which will support the 2025 growth plan announced at our Investor Day in September 2021.”

(1) This press release includes adjusted EBITDA, adjusted diluted EPS, adjusted free cash flow, gross VOI sales and adjusted net income/(loss), which are metrics that are not calculated in accordance with Generally Accepted Accounting Principles in the U.S. (“GAAP”). See "Presentation of Financial Information" and the tables for the definitions and reconciliations of these non-GAAP measures. Forward-looking non-GAAP measures are presented in this press release only on a non-GAAP basis because not all of the information necessary for a quantitative reconciliation is available without unreasonable effort.

Business Segment Results

The results of operations during the fourth quarter and full-year of 2021 and 2020 include impacts related to the COVID-19 global pandemic. Refer to Table 8 for a breakout of COVID-19 related impacts.

Vacation Ownership

$ in millions

Q4 2021

Q4 2020

% change

FY 2021

FY 2020

% change

Revenue

$695

$509

37%

$2,403

$1,625

48%

Adjusted EBITDA

$182

$115

58%

$558

$121

361%

Vacation Ownership revenue increased 37% to $695 million in the fourth quarter of 2021 compared to the same period in the prior year. Gross vacation ownership interest (VOI) sales were $432 million in the fourth quarter compared to $281 million in the prior year period and tours were 129,000 in the fourth quarter compared to 85,000 in the prior year period. Volume Per Guest (VPG) increased 10% to $3,222 due to strong close rates and higher quality tours in the fourth quarter compared to the prior year period.

Fourth quarter adjusted EBITDA was $182 million compared to $115 million in the prior year period. The increase was driven by higher Gross VOI sales due to the ongoing recovery of our operations from COVID-19 and improvement in the provision for loan losses.

Fourth quarter 2021 results include an adjustment to the COVID-19 related allowance for loan losses, resulting in a $44 million increase to revenue and a $16 million increase to cost of vacation ownership interests, and yielding a $28 million net positive impact to Adjusted EBITDA. Fourth quarter 2020 results also include an adjustment to the COVID-19 related allowance, resulting in a $20 million increase to revenue and a $7 million increase to cost of vacation ownership interests, yielding a $13 million net positive impact to Adjusted EBITDA.

Travel and Membership

$ in millions

Q4 2021

Q4 2020

% change

FY 2021

FY 2020

% change

Revenue

$179

$141

27%

$752

$552

36%

Adjusted EBITDA

$64

$50

28%

$282

$191

48%

Travel and Membership revenue increased 27% to $179 million in the fourth quarter driven by a 30% increase in transactions and 6% increase in revenue per transaction. Transactions grew year over year in every quarter of 2021 as we continue to recover from COVID-19 impacted levels.

Fourth quarter Adjusted EBITDA increased 28% to $64 million driven by higher revenue, partially offset by increased operational costs supporting the revenue increase.

Balance Sheet and Liquidity

Net Debt — As of December 31, 2021, the Company's leverage ratio for covenant purposes was 3.99x. The Company had $3.4 billion of corporate debt outstanding as of December 31, 2021, which excluded $1.9 billion of non-recourse debt related to its securitized notes receivables portfolio. Additionally, the Company had cash and cash equivalents of $369 million. At the end of the fourth quarter, the Company had $1.4 billion of liquidity in cash and cash equivalents and revolving credit facility availability.

The Company renewed its $1 billion revolving credit facility on October 22, 2021 and extended the term through October 2026. This renewal terminated the relief period and restrictions regarding share repurchases, dividends and acquisitions under the first amendment.

During the quarter, the Company issued $650 million senior secured notes due 2029 with an interest rate of 4.5% and paid off $650 million senior secured notes due March 2022. The Company's next long-term debt maturity is $400 million of secured notes due March 2023.

Timeshare Receivables Financing The Company closed on a $350 million term securitization on October 26, 2021 with a weighted average coupon of 1.82% and a 98% advance rate.

Cash Flow For the full-year 2021, net cash provided by operating activities was $568 million compared to $374 million in the prior year. Adjusted free cash flow was $223 million in 2021 compared to $35 million in the prior year.

Share Repurchases The Company resumed share repurchase activity in the fourth quarter of 2021 and repurchased 0.5 million shares of common stock for $26 million at a weighted average price of $52.94 per share during the quarter.

Dividend The Company paid $30 million ($0.35 per share) in cash dividends on December 30, 2021 to shareholders of record as of December 15, 2021. For the full-year 2021, Travel + Leisure Co. paid an aggregate $109 million in dividends to shareholders.

Outlook

For the first quarter of 2022, the Company expects adjusted EBITDA to range from $160 million to $170 million.

This guidance is presented only on a non-GAAP basis because not all of the information necessary for a quantitative reconciliation of forward-looking non-GAAP financial measures to the most directly comparable GAAP financial measure is available without unreasonable effort, primarily due to uncertainties relating to the occurrence or amount of these adjustments that may arise in the future.

Conference Call Information

Travel + Leisure Co. will hold a conference call with investors to discuss the Company’s results and outlook today at 8:30 a.m. ET. Participants may listen to a simultaneous webcast of the conference call, which may be accessed through the Company's website at investor.travelandleisureco.com, or by dialing 866-831-8713, passcode TNL, 10 minutes before the scheduled start time. For those unable to listen to the live broadcast, an archive of the webcast will be available on the Company's website for 90 days beginning at 12:00 p.m. ET today. Additionally, a telephone replay will be available for four days beginning at 12:00 p.m. ET today at 800-753-0348.

Presentation of Financial Information

Financial information discussed in this press release includes non-GAAP measures such as adjusted EBITDA, adjusted diluted EPS, adjusted free cash flow, gross VOI sales and adjusted net income/(loss), which include or exclude certain items, as well as non-GAAP guidance. The Company utilizes non-GAAP measures, defined in Table 9, on a regular basis to assess performance of its reportable segments and allocate resources. These non-GAAP measures differ from reported GAAP results and are intended to illustrate what management believes are relevant period-over-period comparisons and are helpful to investors when considered with GAAP measures as an additional tool for further understanding and assessing the Company’s ongoing operating performance by adjusting for items which in our view do not necessarily reflect ongoing performance. Management also internally uses these measures to assess our operating performance, both absolutely and in comparison to other companies, and in evaluating or making selected compensation decisions. Exclusion of items in the Company’s non-GAAP presentation should not be considered an inference that these items are unusual, infrequent or non-recurring. Full reconciliations of non-GAAP financial measures to the most directly comparable GAAP financial measures for the reported periods appear in the financial tables section of the press release. See definitions on Table 9 for an explanation of our non-GAAP measures.

About Travel + Leisure Co.

Travel + Leisure Co. (NYSE:TNL) is the world’s leading membership and leisure travel company, with nearly 20 travel brands across its resort, travel club, and lifestyle portfolio. The company provides outstanding vacation experiences and travel inspiration to millions of owners, members, and subscribers every year through its products and services: Wyndham Destinations, the largest vacation ownership company with more than 245 vacation club resort locations across the globe; Panorama, the world’s foremost membership travel business that includes the largest vacation exchange company and subscription travel brands; and Travel + Leisure Group, featuring top travel content and travel services including the brand’s eponymous travel club. At Travel + Leisure Co., our global team of associates brings hospitality to millions each year, turning vacation inspiration into exceptional travel experiences. We put the world on vacation. Learn more at travelandleisureco.com.

Forward-Looking Statements

This press release includes “forward-looking statements” as that term is defined by the Securities and Exchange Commission (“SEC”). Forward-looking statements are any statements other than statements of historical fact, including statements regarding our expectations, beliefs, hopes, intentions or strategies regarding the future. In some cases, forward-looking statements can be identified by the use of words such as “may,” “will,” “expects,” “should,” “believes,” “plans,” “anticipates,” “estimates,” “predicts,” “potential,” “continue,” “future” or other words of similar meaning. Forward-looking statements are subject to risks and uncertainties that could cause actual results of Travel + Leisure Co. and its subsidiaries (“Travel + Leisure Co.” or “we”) to differ materially from those discussed in, or implied by, the forward-looking statements. Factors that might cause such a difference include, but are not limited to, risks associated with: the acquisition of the Travel + Leisure brand and the future prospects and plans for Travel + Leisure Co., including our ability to execute our strategies to grow our cornerstone timeshare and exchange businesses and expand into the broader leisure travel industry through new business extensions; our ability to compete in the highly competitive timeshare and leisure travel industries; uncertainties related to acquisitions, dispositions and other strategic transactions; the health of the travel industry and declines or disruptions caused by adverse economic conditions and unemployment rates, terrorism or acts of gun violence, political strife, war, pandemics, and severe weather events and other natural disasters; adverse changes in consumer travel and vacation patterns, consumer preferences and demand for our products; increased or unanticipated operating costs and other inherent business risks; our ability to comply with financial and restrictive covenants under our indebtedness and our ability to access capital markets on reasonable terms, at a reasonable cost or at all; maintaining the integrity of internal or customer data and protecting our systems from cyber-attacks; uncertainty with respect to the scope, impact and duration of the novel coronavirus global pandemic (“COVID-19”), including resurgences, the pace of recovery, distribution and adoption of vaccines and treatments, and actions in response to the evolving pandemic by governments, businesses and individuals; the timing and amount of future dividends and share repurchases, if any; and those other factors disclosed as risks under “Risk Factors” in documents we have filed with the SEC, including in Part I, Item 1A of our Annual Report on Form 10-K most recently filed with the SEC. We caution readers that any such statements are based on currently available operational, financial and competitive information, and they should not place undue reliance on these forward-looking statements, which reflect management’s opinion only as of the date on which they were made. Except as required by law, we undertake no obligation to review or update these forward-looking statements to reflect events or circumstances as they occur.

Travel + Leisure Co.

Table of Contents

Table Number

  1. Consolidated Statements of Income/(Loss) (Unaudited)
  2. Summary Data Sheet
  3. Operating Statistics
  4. Revenue by Reportable Segment
  5. Non-GAAP Measure: Reconciliation of Net Income/(Loss) to Adjusted Net Income/(Loss) to Adjusted EBITDA
  6. Non-GAAP Measure: Reconciliation of Net VOI Sales to Gross VOI Sales
  7. Non-GAAP Measure: Reconciliation of Net Cash Provided by Operating Activities to Adjusted Free Cash Flow
  8. COVID-19 Related Impacts
  9. Definitions

Table 1

Travel + Leisure Co.

Consolidated Statements of Income/(Loss) (Unaudited)

(in millions, except per share amounts)

 

 

Three Months

Ended December 31,

 

Twelve Months

Ended December 31,

 

 

2021

 

 

 

2020

 

 

 

2021

 

 

 

2020

 

Net revenues

 

 

 

 

 

 

 

Service and membership fees

$

388

 

 

$

293

 

 

$

1,502

 

 

$

1,139

 

Net VOI sales

 

366

 

 

 

231

 

 

 

1,176

 

 

 

505

 

Consumer financing

 

100

 

 

 

107

 

 

 

404

 

 

 

467

 

Other

 

16

 

 

 

14

 

 

 

52

 

 

 

49

 

Net revenues

 

870

 

 

 

645

 

 

 

3,134

 

 

 

2,160

 

 

 

 

 

 

 

 

 

Expenses

 

 

 

 

 

 

 

Operating

 

367

 

 

 

269

 

 

 

1,359

 

 

 

1,130

 

Cost of vacation ownership interests

 

52

 

 

 

29

 

 

 

157

 

 

 

2

 

Consumer financing interest

 

18

 

 

 

26

 

 

 

81

 

 

 

101

 

General and administrative

 

110

 

 

 

102

 

 

 

434

 

 

 

398

 

Marketing

 

102

 

 

 

82

 

 

 

363

 

 

 

329

 

Depreciation and amortization

 

31

 

 

 

32

 

 

 

124

 

 

 

126

 

COVID-19 related costs

 

 

 

 

6

 

 

 

4

 

 

 

88

 

Restructuring

 

 

 

 

12

 

 

 

(1

)

 

 

39

 

Asset impairments/(recovery)

 

(5

)

 

 

2

 

 

 

(5

)

 

 

52

 

Total expenses

 

675

 

 

 

560

 

 

 

2,516

 

 

 

2,265

 

 

 

 

 

 

 

 

 

Operating income/(loss)

 

195

 

 

 

85

 

 

 

618

 

 

 

(105

)

Other (income), net

 

(4

)

 

 

(3

)

 

 

(6

)

 

 

(14

)

Interest expense

 

50

 

 

 

54

 

 

 

198

 

 

 

192

 

Interest (income)

 

(1

)

 

 

(1

)

 

 

(3

)

 

 

(7

)

Income/(loss) before income taxes

 

150

 

 

 

35

 

 

 

429

 

 

 

(276

)

Provision for/(benefit from) income taxes

 

40

 

 

 

31

 

 

 

116

 

 

 

(23

)

Net income/(loss) from continuing operations

 

110

 

 

 

4

 

 

 

313

 

 

 

(253

)

Loss on disposal of discontinued business, net of income taxes

 

(3

)

 

 

(2

)

 

 

(5

)

 

 

(2

)

Net income/(loss) attributable to TNL shareholders

$

107

 

 

$

2

 

 

$

308

 

 

$

(255

)

 

 

 

 

 

 

 

 

Basic earnings/(loss) per share

 

 

 

 

 

 

 

Continuing operations

$

1.27

 

 

$

0.05

 

 

$

3.62

 

 

$

(2.95

)

Discontinued operations

 

(0.04

)

 

 

(0.02

)

 

 

(0.06

)

 

 

(0.02

)

 

$

1.23

 

 

$

0.03

 

 

$

3.56

 

 

$

(2.97

)

 

 

 

 

 

 

 

 

Diluted earnings/(loss) per share

 

 

 

 

 

 

 

Continuing operations

$

1.26

 

 

$

0.05

 

 

$

3.58

 

 

$

(2.95

)

Discontinued operations

 

(0.04

)

 

 

(0.02

)

 

 

(0.06

)

 

 

(0.02

)

 

$

1.22

 

 

$

0.03

 

 

$

3.52

 

 

$

(2.97

)

 

 

 

 

 

 

 

 

Weighted average shares outstanding

 

 

 

 

 

 

 

Basic

 

86.5

 

 

 

86.1

 

 

 

86.5

 

 

 

86.1

 

Diluted

 

87.4

 

 

 

86.6

 

 

 

87.3

 

 

 

86.1

 

Table 2

Travel + Leisure Co.

Summary Data Sheet

(in millions, except per share amounts, unless otherwise indicated)

 

 

Three Months Ended December 31,

 

Twelve Months Ended December 31,

 

 

2021

 

 

 

2020

 

 

Change

 

 

2021

 

 

 

2020

 

 

Change

Consolidated Results

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income/(loss) attributable to TNL shareholders

$

107

 

 

$

2

 

 

NM

 

 

$

308

 

 

$

(255

)

 

221

%

Diluted earnings/(loss) per share

$

1.22

 

 

$

0.03

 

 

NM

 

 

$

3.52

 

 

$

(2.97

)

 

219

%

Net income/(loss) from continuing operations

$

110

 

 

$

4

 

 

NM

 

 

$

313

 

 

$

(253

)

 

224

%

Diluted earnings/(loss) per share from continuing operations

$

1.26

 

 

$

0.05

 

 

NM

 

 

$

3.58

 

 

$

(2.95

)

 

221

%

 

 

 

 

 

 

 

 

 

 

 

 

Net income/(loss) margin

 

12.3

%

 

 

0.3

%

 

 

 

 

9.8

%

 

 

(11.8

) %

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Adjusted Earnings/(Loss)

 

 

 

 

 

 

 

 

 

 

Adjusted EBITDA

$

228

 

 

$

148

 

 

54

%

 

$

778

 

 

$

259

 

 

200

%

Adjusted net income/(loss)

$

104

 

 

$

28

 

 

271

%

 

$

319

 

 

$

(80

)

 

499

%

Adjusted diluted earnings/(loss) per share

$

1.19

 

 

$

0.32

 

 

272

%

 

$

3.65

 

 

$

(0.94

)

 

488

%

 

 

 

 

 

 

 

 

 

 

 

 

Segment Results

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net Revenues

 

 

 

 

 

 

 

 

 

 

 

Vacation Ownership

$

695

 

 

$

509

 

 

37

%

 

$

2,403

 

 

$

1,625

 

 

48

%

Travel and Membership

 

179

 

 

 

141

 

 

27

%

 

 

752

 

 

 

552

 

 

36

%

Corporate and other

 

(4

)

 

 

(5

)

 

 

 

 

(21

)

 

 

(17

)

 

 

Total

$

870

 

 

$

645

 

 

35

%

 

$

3,134

 

 

$

2,160

 

 

45

%

 

 

 

 

 

 

 

 

 

 

 

 

Adjusted EBITDA

 

 

 

 

 

 

 

 

 

 

 

Vacation Ownership

$

182

 

 

$

115

 

 

58

%

 

$

558

 

 

$

121

 

 

361

%

Travel and Membership

 

64

 

 

 

50

 

 

28

%

 

 

282

 

 

 

191

 

 

48

%

Segment Adjusted EBITDA

 

246

 

 

 

165

 

 

 

 

 

840

 

 

 

312

 

 

 

Corporate and other

 

(18

)

 

 

(17

)

 

 

 

 

(62

)

 

 

(53

)

 

 

Total Adjusted EBITDA

$

228

 

 

$

148

 

 

54

%

 

$

778

 

 

$

259

 

 

200

%

 

 

 

 

 

 

 

 

 

 

 

 

Adjusted EBITDA Margin

 

26.2

%

 

 

22.9

%

 

 

 

 

24.8

%

 

 

12.0

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Key Operating Statistics

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Vacation Ownership

 

 

 

 

 

 

 

 

 

 

 

Gross VOI sales

$

432

 

 

$

281

 

 

54

%

 

$

1,491

 

 

$

967

 

 

54

%

Tours (in thousands)

 

129

 

 

 

85

 

 

52

%

 

 

451

 

 

 

333

 

 

35

%

VPG (in dollars)

$

3,222

 

 

$

2,938

 

 

10

%

 

$

3,143

 

 

$

2,486

 

 

26

%

New owner sales, volume mix

 

25.3

%

 

 

25.3

%

 

 

 

 

28.0

%

 

 

27.3

%

 

 

New owner sales, transaction mix

 

24.7

%

 

 

24.8

%

 

 

 

 

27.8

%

 

 

28.9

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Travel and Membership

 

 

 

 

 

 

 

 

 

 

 

Transactions (in thousands)

 

452

 

 

 

348

 

 

30

%

 

 

1,960

 

 

 

1,220

 

 

61

%

Revenue per transaction (in dollars)

$

270

 

 

$

254

 

 

6

%

 

$

275

 

 

$

258

 

 

7

%

Avg. number of exchange members (in thousands)

 

3,831

 

 

 

3,652

 

 

5

%

 

 

3,721

 

 

 

3,749

 

 

(1

) %

NM is defined as Not Meaningful

Note: Amounts may not calculate due to rounding. See Table 9 for definitions. For a full reconciliation of non-GAAP financial measures to the most directly comparable GAAP financial measures, refer to Table 5 and Table 6. See "Presentation of Financial Information" and the tables for the definitions and reconciliations of these non-GAAP measures in accordance with GAAP.

In connection with the Travel + Leisure brand acquisition we updated the names and composition of our reportable segments to better align with how they are managed. We created the Travel + Leisure Group which falls under the Travel and Membership segment along with the Panorama business line. With the formation of Travel + Leisure Group, we decided that the operations of our Extra Holidays business, which focuses on direct to consumer bookings, better aligns with the operations of this new business line and therefore transitioned the management of our Extra Holidays business to the Travel and Membership segment. As such, we reclassified the results of our Extra Holidays business, which were previously reported within the Vacation Ownership segment, into the Travel and Membership segment.

Table 3

Travel + Leisure Co.

Operating Statistics: Travel and Membership

 

 The following operating statistics are the significant drivers of the Company's revenues and therefore provide an enhanced understanding of the Company's businesses: (a)

 

 

Year

 

Q1

 

Q2

 

Q3

 

Q4

 

Full Year

Gross VOI Sales (in millions) (a)

2021

 

$

236

 

 

$

383

 

 

$

440

 

 

$

432

 

 

$

1,491

 

2020

 

$

413

 

 

$

18

 

 

$

256

 

 

$

281

 

 

$

967

 

2019

 

$

484

 

 

$

626

 

 

$

663

 

 

$

582

 

 

$

2,355

 

 

 

 

 

 

 

 

 

 

 

 

 

Tours (in thousands)

2021

 

 

76

 

 

 

117

 

 

 

129

 

 

 

129

 

 

 

451

 

2020

 

 

162

 

 

 

6

 

 

 

80

 

 

 

85

 

 

 

333

 

2019

 

 

192

 

 

 

249

 

 

 

269

 

 

 

234

 

 

 

945

 

 

 

 

 

 

 

 

 

 

 

 

 

VPG

2021

 

$

2,847

 

 

$

3,151

 

 

$

3,233

 

 

$

3,222

 

 

$

3,143

 

2020

 

$

2,128

 

 

 

NM

 

 

$

3,039

 

 

$

2,938

 

 

$

2,486

 

2019

 

$

2,405

 

 

$

2,425

 

 

$

2,332

 

 

$

2,373

 

 

$

2,381

 

 

 

 

 

 

 

 

 

 

 

 

 

Provision for Loan Losses

(in millions) (b)

2021

 

$

(38

)

 

$

(33

)

 

$

(49

)

 

$

(9

)

 

$

(129

)

2020

 

$

(315

)

 

$

(30

)

 

$

(45

)

 

$

(25

)

 

$

(415

)

2019

 

$

(109

)

 

$

(129

)

 

$

(135

)

 

$

(106

)

 

$

(479

)

 

 

 

 

 

 

 

 

 

 

 

 

Provision for Loan Loss as a

Percentage of Gross VOI Sales,

net of Fee-for-Service sales

2021

 

 

18.1

%

 

10.1% (c)

 

12.4% (d)

 

2.4% (e)

 

9.9% (f)

2020

 

 

NM

 

 

 

NM

 

 

 

18.8

%

 

9.5% (g)

 

 

NM

 

2019

 

 

22.5

%

 

 

21.2

%

 

 

20.3

%

 

 

18.6

%

 

 

20.6

%

 

 

 

 

 

 

 

 

 

 

 

 

Allowance for Loan Losses

(in millions)

2021

 

$

622

 

 

$

573

 

 

$

565

 

 

$

510

 

 

$

510

 

2020

 

$

930

 

 

$

846

 

 

$

788

 

 

$

693

 

 

$

693

 

2019

 

$

721

 

 

$

735

 

 

$

767

 

 

$

747

 

 

$

747

 

 

 

 

 

 

 

 

 

 

 

 

 

Gross Vacation Ownership

Contract Receivables (in millions)

2021

 

$

2,975

 

 

$

2,892

 

 

$

2,857

 

 

$

2,819

 

 

$

2,819

 

2020

 

$

3,722

 

 

$

3,461

 

 

$

3,309

 

 

$

3,175

 

 

$

3,175

 

2019

 

$

3,741

 

 

$

3,783

 

 

$

3,885

 

 

$

3,867

 

 

$

3,867

 

 

 

 

 

 

 

 

 

 

 

 

 

Allowance for Loan Loss as a

Percentage of Gross Vacation

Ownership Contract Receivables

2021

 

 

20.9

%

 

 

19.8

%

 

 

19.8

%

 

 

18.1

%

 

 

18.1

%

2020

 

 

25.0

%

 

 

24.4

%

 

 

23.8

%

 

 

21.8

%

 

 

21.8

%

2019

 

 

19.3

%

 

 

19.4

%

 

 

19.7

%

 

 

19.3

%

 

 

19.3

%

Note: Full year amounts and percentages may not compute due to rounding.
NM Not Meaningful

(a)

Includes Gross VOI sales under the Company's Fee-for-Service sales. (See Table 6 for a reconciliation of Net VOI sales to Gross VOI sales).

(b)

Represents provision for estimated losses on vacation ownership contract receivables, which is recorded as contra revenue to vacation ownership interest sales on the Consolidated Statements of Income/(Loss).

(c)

The percentage was 18.0%, excluding the release of $26 million of the COVID-19 related provision during the period.

(d)

The percentage was 17.8%, excluding the release of $21 million of the COVID-19 related provision during the period.

(e)

The percentage was 14.1%, excluding the release of $44 million of the COVID-19 related provision during the period.

(f)

The percentage was 16.8%, excluding the release of $91 million of the COVID-19 related provision during the period.

(g)

The percentage was 17.3%, excluding the release of $20 million of the COVID-19 related provision during the period.

Table 3

(continued)

Travel + Leisure Co.

Operating Statistics: Travel and Membership

 

The following operating statistics are the significant drivers of the Company's revenues and therefore provide an enhanced understanding of the Company's businesses: (a)

 

 

Year

 

Q1

 

Q2

 

Q3

 

Q4

 

Full Year

Transactions (in thousands)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Exchange

2021

 

 

354

 

 

314

 

 

256

 

 

257

 

 

1,182

Non-Exchange

2021

 

 

159

 

 

210

 

 

214

 

 

195

 

 

778

Total Transactions

2021

 

 

513

 

 

524

 

 

470

 

 

452

 

 

1,960

 

 

 

 

 

 

 

 

 

 

 

 

Exchange

2020

 

 

260

 

 

72

 

 

214

 

 

217

 

 

762

Non-Exchange

2020

 

 

141

 

 

44

 

 

142

 

 

131

 

 

458

Total Transactions

2020

 

 

401

 

 

116

 

 

356

 

 

348

 

 

1,220

 

 

 

 

 

 

 

 

 

 

 

 

Exchange

2019

 

 

444

 

 

377

 

 

367

 

 

304

 

 

1,493

Non-Exchange

2019

 

 

52

 

 

63

 

 

138

 

 

153

 

 

405

Total Transactions

2019

 

 

496

 

 

440

 

 

505

 

 

457

 

 

1,898

 

 

 

 

 

 

 

 

 

 

 

 

Revenue per transaction (in dollars)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Exchange

2021

 

$

292

 

$

331

 

$

339

 

$

335

 

$

322

Non-Exchange

2021

 

$

182

 

$

231

 

$

214

 

$

184

 

$

205

Total Revenue per transaction

2021

 

$

258

 

$

291

 

$

282

 

$

270

 

$

275

 

 

 

 

 

 

 

 

 

 

 

 

Exchange

2020

 

$

279

 

$

540

 

$

300

 

$

330

 

$

324

Non-Exchange

2020

 

$

164

 

$

133

 

$

157

 

$

128

 

$

148

Total Revenue per transaction

2020

 

$

239

 

$

384

 

$

243

 

$

254

 

$

258

 

 

 

 

 

 

 

 

 

 

 

 

Exchange

2019

 

$

275

 

$

276

 

$

276

 

$

307

 

$

282

Non-Exchange

2019

 

$

216

 

$

185

 

$

172

 

$

165

 

$

177

Total Revenue per transaction

2019

 

$

269

 

$

263

 

$

247

 

$

259

 

$

259

 

 

 

 

 

 

 

 

 

 

 

 

Avg. Number of Exchange Members

(in thousands)

2021

 

 

3,576

 

 

3,582

 

 

3,895

 

 

3,831

 

 

3,721

2020

 

 

3,864

 

 

3,799

 

 

3,680

 

 

3,652

 

 

3,749

2019

 

 

3,875

 

 

3,893

 

 

3,895

 

 

3,884

 

 

3,887

Note: Full year amounts and percentages may not compute due to rounding.

(a)

Includes the impact of acquisitions from the acquisition dates forward.

Table 4

Travel + Leisure Co.

Revenue by Reportable Segment

(in millions)

 

 

 

2021

 

 

Q1

 

Q2

 

Q3

 

Q4

 

Full Year

Vacation Ownership

 

 

 

 

 

 

 

 

 

 

Net VOI Sales

 

$

172

 

$

294

 

 

$

344

 

$

366

 

$

1,176

Property Management Fees and Reimbursable Revenues

 

 

157

 

 

161

 

 

 

171

 

 

182

 

 

671

Consumer Financing

 

 

98

 

 

102

 

 

 

103

 

 

100

 

 

404

Other Revenues

 

 

22

 

 

42

 

 

 

42

 

 

47

 

 

152

Total Vacation Ownership

 

 

449

 

 

599

 

 

 

660

 

 

695

 

 

2,403

 

 

 

 

 

 

 

 

 

 

 

Travel and Membership

 

 

 

 

 

 

 

 

 

 

Transaction Revenues

 

 

132

 

 

153

 

 

 

133

 

 

122

 

 

540

Subscription Revenues

 

 

41

 

 

43

 

 

 

43

 

 

48

 

 

176

Other Revenues

 

 

10

 

 

8

 

 

 

9

 

 

9

 

 

36

Total Travel and Membership

 

 

183

 

 

204

 

 

 

185

 

 

179

 

 

752

Total Reportable Segments

 

$

632

 

$

803

 

 

$

845

 

$

874

 

$

3,155

 

 

 

 

 

 

 

 

 

 

 

 

 

2020

 

 

Q1

 

Q2

 

Q3

 

Q4

 

Full Year

Vacation Ownership

 

 

 

 

 

 

 

 

 

 

Net VOI Sales

 

$

90

 

$

(13

)

 

$

196

 

$

231

 

$

505

Property Management Fees and Reimbursable Revenues

 

 

170

 

 

122

 

 

 

146

 

 

145

 

 

583

Consumer Financing

 

 

127

 

 

119

 

 

 

115

 

 

107

 

 

467

Other Revenues

 

 

16

 

 

10

 

 

 

18

 

 

26

 

 

70

Total Vacation Ownership

 

 

403

 

 

238

 

 

 

475

 

 

509

 

 

1,625

 

 

 

 

 

 

 

 

 

 

 

Travel and Membership

 

 

 

 

 

 

 

 

 

 

Transaction Revenues

 

 

96

 

 

44

 

 

 

86

 

 

88

 

 

315

Subscription Revenues

 

 

44

 

 

33

 

 

 

43

 

 

40

 

 

160

Other Revenues

 

 

19

 

 

29

 

 

 

16

 

 

13

 

 

77

Total Travel and Membership

 

 

159

 

 

106

 

 

 

145

 

 

141

 

 

552

Total Reportable Segments

 

$

562

 

$

344

 

 

$

620

 

$

650

 

$

2,177

 

 

 

 

 

 

 

 

 

 

 

 

 

2019

 

 

Q1

 

Q2

 

Q3

 

Q4

 

Full Year

Vacation Ownership

 

 

 

 

 

 

 

 

 

 

Net VOI Sales

 

$

375

 

$

481

 

 

$

528

 

$

464

 

$

1,848

Property Management Fees and Reimbursable Revenues

 

 

163

 

 

162

 

 

 

170

 

 

176

 

 

672

Consumer Financing

 

 

125

 

 

128

 

 

 

132

 

 

130

 

 

515

Other Revenues

 

 

12

 

 

31

 

 

 

20

 

 

24

 

 

87

Total Vacation Ownership

 

 

675

 

 

802

 

 

 

850

 

 

794

 

 

3,122

 

 

 

 

 

 

 

 

 

 

 

Travel and Membership

 

 

 

 

 

 

 

 

 

 

Transaction Revenues

 

 

133

 

 

116

 

 

 

125

 

 

118

 

 

492

Subscription Revenues

 

 

55

 

 

54

 

 

 

54

 

 

53

 

 

216

Vacation Rental Revenue

 

 

38

 

 

48

 

 

 

60

 

 

7

 

 

153

Other Revenues

 

 

22

 

 

24

 

 

 

24

 

 

14

 

 

83

Total Travel and Membership

 

 

248

 

 

242

 

 

 

263

 

 

192

 

 

944

Total Reportable Segments

 

$

923

 

$

1,044

 

 

$

1,113

 

$

986

 

$

4,066

 

Note: Full year amounts may not add across due to rounding.

Table 5

Travel + Leisure Co.

Non-GAAP Measure: Reconciliation of Net Income/(Loss) to

Adjusted Net Income/(Loss) to Adjusted EBITDA

(in millions, except diluted per share amounts)

 

 

Three Months Ended December 31,

 

 

2021

 

 

EPS

 

Margin %

 

 

2020

 

 

EPS

 

Margin %

Net income attributable to TNL shareholders

$

107

 

 

$

1.22

 

12.3

%

 

$

2

 

 

$

0.03

 

0.3

%

Loss on disposal of discontinued business, net of income taxes

 

(3

)

 

 

 

 

 

 

(2

)

 

 

 

 

Net income from continuing operations

$

110

 

 

$

1.26

 

12.6

%

 

$

4

 

 

$

0.05

 

0.6

%

Amortization of acquired intangibles (a)

 

2

 

 

 

 

 

 

 

2

 

 

 

 

 

Restructuring costs

 

 

 

 

 

 

 

 

12

 

 

 

 

 

COVID-19 related costs (b)

 

 

 

 

 

 

 

 

6

 

 

 

 

 

Legacy items

 

(2

)

 

 

 

 

 

 

2

 

 

 

 

 

Unrealized gain on equity investment (c)

 

(3

)

 

 

 

 

 

 

 

 

 

 

 

Impairments/(recovery) (d)

 

(5

)

 

 

 

 

 

 

2

 

 

 

 

 

Taxes (e)

 

2

 

 

 

 

 

 

 

 

 

 

 

 

Adjusted net income

$

104

 

 

$

1.19

 

12.0

%

 

$

28

 

 

$

0.32

 

4.3

%

Income taxes on adjusted net income

 

38

 

 

 

 

 

 

 

31

 

 

 

 

 

Interest expense

 

50

 

 

 

 

 

 

 

54

 

 

 

 

 

Depreciation

 

29

 

 

 

 

 

 

 

30

 

 

 

 

 

Stock-based compensation expense (f)

 

8

 

 

 

 

 

 

 

6

 

 

 

 

 

Interest income

 

(1

)

 

 

 

 

 

 

(1

)

 

 

 

 

Adjusted EBITDA

$

228

 

 

 

 

26.2

%

 

$

148

 

 

 

 

22.9

%

 

 

 

 

 

 

 

 

 

 

 

 

Diluted Shares Outstanding

 

87.4

 

 

 

 

 

 

 

86.6

 

 

 

 

 

 

 

Table 5

(continued)

 

Twelve Months Ended December 31,

 

 

2021

 

 

EPS

 

Margin %

 

 

2020

 

 

EPS

 

Margin %

Net income/(loss) attributable to TNL shareholders

$

308

 

 

$

3.52

 

9.8

%

 

$

(255

)

 

$

(2.97

)

 

(11.8

) %

Loss on disposal of discontinued business, net of income taxes

 

(5

)

 

 

 

 

 

 

(2

)

 

 

 

 

Net income/(loss) from continuing operations

$

313

 

 

$

3.58

 

10.0

%

 

$

(253

)

 

$

(2.95

)

 

(11.7

) %

Amortization of acquired intangibles (a)

 

9

 

 

 

 

 

 

 

9

 

 

 

 

 

Legacy items

 

4

 

 

 

 

 

 

 

4

 

 

 

 

 

COVID-19 related costs (b)

 

3

 

 

 

 

 

 

 

56

 

 

 

 

 

Exchange inventory write-off

 

 

 

 

 

 

 

 

48

 

 

 

 

 

Restructuring costs

 

(1

)

 

 

 

 

 

 

39

 

 

 

 

 

Unrealized gain on equity investment (c)

 

(3

)

 

 

 

 

 

 

 

 

 

 

 

Impairments/(recovery) (d)

 

(5

)

 

 

 

 

 

 

57

 

 

 

 

 

Taxes (e)

 

(1

)

 

 

 

 

 

 

(40

)

 

 

 

 

Adjusted net income/(loss)

$

319

 

 

$

3.65

 

10.2

%

 

$

(80

)

 

$

(0.94

)

 

(3.7

) %

Income taxes on adjusted net income/(loss)

 

117

 

 

 

 

 

 

 

17

 

 

 

 

 

Interest expense

 

198

 

 

 

 

 

 

 

192

 

 

 

 

 

Depreciation

 

115

 

 

 

 

 

 

 

117

 

 

 

 

 

Stock-based compensation expense (f)

 

32

 

 

 

 

 

 

 

20

 

 

 

 

 

Interest income

 

(3

)

 

 

 

 

 

 

(7

)

 

 

 

 

Adjusted EBITDA

$

778

 

 

 

 

24.8

%

 

$

259

 

 

 

 

12.0

%

 

 

 

 

 

 

 

 

 

 

 

 

Diluted Shares Outstanding

 

87.3

 

 

 

 

 

 

 

86.1

 

 

 

 

 

Amounts may not calculate due to rounding. The table above reconciles certain non-GAAP financial measures to their closest GAAP measure. The presentation of these adjustments is intended to permit the comparison of particular adjustments as they appear in the income statement in order to assist investors' understanding of the overall impact of such adjustments. In addition to GAAP financial measures, the Company provides adjusted net income/(loss), adjusted EBITDA, adjusted EBITDA margin, and adjusted diluted EPS to assist our investors in evaluating our ongoing operating performance for the current reporting period and, where provided, over different reporting periods, by adjusting for certain items which in our view do not necessarily reflect ongoing performance. We also internally use these measures to assess our operating performance, both absolutely and in comparison to other companies, and in evaluating or making selected compensation decisions. These supplemental disclosures are in addition to GAAP reported measures. Non-GAAP measures should not be considered a substitute for, nor superior to, financial results and measures determined or calculated in accordance with GAAP. Our presentation of adjusted measures may not be comparable to similarly-titled measures used by other companies. See "Presentation of Financial Information" and table 9 for the definitions of these non-GAAP measures.

 

(a)

Amortization of acquisition-related intangible assets is excluded from adjusted net income/(loss) and adjusted EBITDA.

(b)

Reflects severance and other employee costs associated with layoffs due to the COVID-19 workforce reduction offset in part by employee retention credits received in connection with the U.S. CARES Act, ARPA and similar international programs for wages paid to certain employees despite having operations suspended. This amount does not include costs associated with idle pay.

(c)

Represents the unrealized gain associated with Vacasa equity acquired as part of the consideration for the sale of North America vacation rentals. The total amount of unrealized gain on this investment was $9 million for the year ended December 31, 2021, of which $6 million is included in Asset Impairments/(recovery) on the Consolidated Statements of Income/(Loss) to offset the 2020 impairment recognized on this investment.

(d)

Includes $5 million of bad debt expense related to a note receivable for the twelve months ended December 31, 2020, included in Operating expenses on the Consolidated Statements of Income/(Loss).

(e)

The amounts represent the tax effects on the adjustments. In addition, during the three months ended December 31, 2020, the amounts are partially offset by $3 million of non-cash tax expense associated with COVID-19 related increases to valuation allowances and $5 million of additional tax related to the Company's former rentals businesses. In the twelve months ended December 31, 2020, the amounts are partially offset by $9 million of non-cash tax expense associated with COVID-19 related increases to valuation allowances and $5 million of additional tax related to the Company's former rentals businesses.

(f)

All stock-based compensation is excluded from adjusted EBITDA.

Table 6

Travel + Leisure Co.

Non-GAAP Measure: Reconciliation of Net VOI Sales to Gross VOI Sales

(in millions)

 

The Company believes gross VOI sales provide an enhanced understanding of the performance of its vacation ownership business because it directly measures the sales volume of this business during a given reporting period.

 

The following table provides a reconciliation of Net VOI sales (see Table 4) to Gross VOI sales (see Table 3):

Year

 

 

 

 

 

 

 

 

 

 

2021

 

Q1

 

Q2

 

Q3

 

Q4

 

Full Year

 

 

 

 

 

 

 

 

 

 

 

 

Net VOI sales

 

$

172

 

$

294

 

 

$

344

 

$

366

 

$

1,176

Loan loss provision

 

 

38

 

 

33

 

 

 

49

 

 

9

 

 

129

Gross VOI sales, net of Fee-for-Service sales

 

 

210

 

 

327

 

 

 

393

 

 

375

 

 

1,305

Fee-for-Service sales

 

 

26

 

 

56

 

 

 

47

 

 

57

 

 

186

Gross VOI sales

 

$

236

 

$

383

 

 

$

440

 

$

432

 

$

1,491

 

 

 

 

 

 

 

 

 

 

 

2020

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net VOI sales

 

$

90

 

$

(13

)

 

$

196

 

$

231

 

$

505

Loan loss provision

 

 

315

 

 

30

 

 

 

45

 

 

25

 

 

415

Gross VOI sales, net of Fee-for-Service sales

 

 

405

 

 

17

 

 

 

241

 

 

256

 

 

920

Fee-for-Service sales

 

 

8

 

 

1

 

 

 

15

 

 

25

 

 

47

Gross VOI sales

 

$

413

 

$

18

 

 

$

256

 

$

281

 

$

967

 

 

 

 

 

 

 

 

 

 

 

 

2019

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net VOI sales

 

$

375

 

$

481

 

 

$

528

 

$

464

 

$

1,848

Loan loss provision

 

 

109

 

 

129

 

 

 

135

 

 

106

 

 

479

Gross VOI sales, net of Fee-for-Service sales

 

 

484

 

 

610

 

 

 

663

 

 

570

 

 

2,327

Fee-for-Service sales

 

 

 

 

16

 

 

 

 

 

12

 

 

28

Gross VOI sales

 

$

484

 

$

626

 

 

$

663

 

$

582

 

$

2,355

 

Note: Amounts may not add due to rounding.

Table 7

Travel + Leisure Co.

Non-GAAP Measure: Reconciliation of Net Cash Provided by Operating Activities to Adjusted Free Cash Flow

(in millions)

 

 

 

Twelve Months

Ended December 31,

 

 

 

2021

 

 

 

2020

 

 

 

 

 

 

Net cash provided by operating activities

 

$

568

 

 

$

374

 

Property and equipment additions

 

 

(57

)

 

 

(69

)

Sum of proceeds and principal payments of non-recourse vacation ownership debt

 

 

(294

)

 

 

(333

)

Free cash flow

 

$

217

 

 

$

(28

)

Separation and other adjustments (a)

 

 

 

 

 

16

 

COVID-19 related adjustments (b)

 

 

6

 

 

 

47

 

Adjusted free cash flow (c)

 

$

223

 

 

$

35

 

(a)

Includes cash paid for separation-related activities and transaction costs for acquisitions and divestitures.

(b)

Includes cash paid for COVID-19 expenses factored into the calculation of Adjusted EBITDA.

(c)

The Company had $93 million of net cash used in investing and $1.29 billion of net cash used in financing activities for the year ended December 31, 2021, and $65 million of net cash used in investing activities and $502 million of net cash provided by financing activities for the year ended December 31, 2020.

 

Table 8

Travel + Leisure Co.

COVID-19 Related Impacts

(in millions)

 

The tables below present the COVID-19 related impacts to our results of operations for three and twelve months ended December 31, 2021, and the related classification on the Consolidated Statements of Income/(Loss):

 

Three Months Ended

 

Vacation Ownership

 

Travel and Membership

 

Corporate

& Other

 

Consolidated

 

Non-GAAP

Adjustments

 

Income Statement

Classification

December 31, 2021

 

 

 

 

 

 

Allowance for loan losses:

 

 

 

 

 

 

 

 

 

 

 

 

Provision

 

$

(44

)

 

$

 

 

$

 

$

(44

)

 

$

 

 

Vacation ownership interest sales

Recoveries

 

 

16

 

 

 

 

 

 

 

 

16

 

 

 

 

 

Cost of vacation ownership interests

Asset impairment recovery

 

 

 

 

 

(6

)

 

 

 

 

(6

)

 

 

(6

)

 

Asset impairments/(recovery)

Total COVID-19

 

$

(28

)

 

$

(6

)

 

$

 

$

(34

)

 

$

(6

)

 

 

Twelve Months Ended

 

Vacation Ownership

 

Travel and Membership

 

Corporate

& Other

 

Consolidated

 

Non-GAAP

Adjustments

 

Income Statement

Classification

December 31, 2021

 

 

 

 

 

 

Allowance for loan losses:

 

 

 

 

 

 

 

 

 

 

 

 

Provision

 

$

(91

)

 

$

 

 

$

 

$

(91

)

 

$

 

 

Vacation ownership interest sales

Recoveries

 

 

33

 

 

 

 

 

 

 

 

33

 

 

 

 

 

Cost of vacation ownership interests

Employee compensation related and other

 

 

3

 

 

 

 

 

 

1

 

 

4

 

 

 

3

 

 

COVID-19 related costs

Asset impairment recovery

 

 

 

 

 

(6

)

 

 

 

 

(6

)

 

 

(6

)

 

Asset impairments/(recovery)

Lease-related

 

 

(1

)

 

 

 

 

 

 

 

(1

)

 

 

(1

)

 

Restructuring

Total COVID-19

 

$

(56

)

 

$

(6

)

 

$

1

 

$

(61

)

 

$

(4

)

 

 

Table 8

(continued)

The tables below present the COVID-19 related impacts to our results of operations for three and twelve months ended December 31, 2020, and the related classification on the Consolidated Statements of Income/(Loss):

Three Months Ended

 

Vacation Ownership

 

Travel and Membership

 

Corporate

& Other

 

Consolidated

 

Non-GAAP

Adjustments

 

Income Statement

Classification

December 31, 2020

 

 

 

 

 

 

Allowance for loan losses:

 

 

 

 

 

 

 

 

 

 

 

 

Provision

 

$

(20

)

 

$

 

$

 

$

(20

)

 

$

 

Vacation ownership interest sales

Recoveries

 

 

7

 

 

 

 

 

 

 

7

 

 

 

 

Cost of vacation ownership interests

Employee compensation related and other

 

 

3

 

 

 

2

 

 

2

 

 

7

 

 

 

6

 

COVID-19 related costs

Asset impairments

 

 

1

 

 

 

 

 

1

 

 

2

 

 

 

2

 

Asset impairments/(recovery)

Lease-related

 

 

12

 

 

 

 

 

 

 

12

 

 

 

12

 

Restructuring

Total COVID-19

 

$

3

 

 

$

2

 

$

3

 

$

8

 

 

$

20

 

 

Twelve Months Ended

 

Vacation Ownership

 

Travel and Membership

 

Corporate

& Other

 

Consolidated

 

Non-GAAP

Adjustments

 

Income Statement

Classification

December 31, 2020

 

 

 

 

 

 

Allowance for loan losses:

 

 

 

 

 

 

 

 

 

 

 

 

Provision

 

$

205

 

 

$

 

$

 

$

205

 

 

$

 

Vacation ownership interest sales

Recoveries

 

 

(48

)

 

 

 

 

 

 

(48

)

 

 

 

Cost of vacation ownership interests

Employee compensation related and other

 

 

65

 

 

 

9

 

 

14

 

 

88

 

 

 

56

 

COVID-19 related costs

Asset impairments

 

 

21

 

 

 

34

 

 

1

 

 

56

 

 

 

56

 

Asset impairments/(recovery) and Operating expenses

Exchange inventory write-off

 

 

 

 

 

48

 

 

 

 

48

 

 

 

48

 

Operating expenses

Lease-related

 

 

14

 

 

 

22

 

 

 

 

36

 

 

 

36

 

Restructuring

Total COVID-19

 

$

257

 

 

$

113

 

$

15

 

$

385

 

 

$

196

 

 

Table 9 

Definitions

Adjusted Diluted Earnings/(Loss) per Share: A non-GAAP measure, defined by the Company as Adjusted net income/(loss) divided by the diluted weighted average number of common shares.

 

Adjusted EBITDA: A non-GAAP measure, defined by the Company as net income/(loss) from continuing operations before depreciation and amortization, interest expense (excluding consumer financing interest), early extinguishment of debt, interest income (excluding consumer financing revenues) and income taxes, each of which is presented on the Consolidated Statements of Income. Adjusted EBITDA also excludes stock-based compensation costs, separation and restructuring costs, legacy items, transaction costs for acquisitions and divestitures, impairments, gains and losses on sale/disposition of business, and items that meet the conditions of unusual and/or infrequent. Legacy items include the resolution of and adjustments to certain contingent assets and liabilities related to acquisitions of continuing businesses and dispositions, including the separation of Wyndham Hotels and Cendant, and the sale of the vacation rentals businesses. We believe that when considered with GAAP measures, Adjusted EBITDA is useful to assist our investors in evaluating our ongoing operating performance for the current reporting period and, where provided, over different reporting periods. We also internally use these measures to assess our operating performance, both absolutely and in comparison to other companies, and in evaluating or making selected compensation decisions. Adjusted EBITDA should not be considered in isolation or as a substitute for net income/(loss) or other income statement data prepared in accordance with GAAP and our presentation of Adjusted EBITDA may not be comparable to similarly-titled measures used by other companies.

 

Adjusted EBITDA Margin: A non-GAAP measure, represents Adjusted EBITDA as a percentage of revenue.

 

Adjusted Free Cash Flow: A non-GAAP measure, defined by the Company as net cash provided by operating activities from continuing operations less property and equipment additions (capital expenditures) plus the sum of proceeds and principal payments of non-recourse vacation ownership debt, while also adding back cash paid for transaction costs for acquisitions and divestitures, separation adjustments associated with the spin-off of Wyndham Hotels, and certain adjustments related to COVID-19. A limitation of using Adjusted free cash flow versus the GAAP measure of net cash provided by operating activities as a means for evaluating TNL is that Adjusted free cash flow does not represent the total cash movement for the period as detailed in the consolidated statement of cash flows.

 

Adjusted Net Income/(Loss): A non-GAAP measure, defined by the Company as net income/(loss) from continuing operations adjusted to exclude separation and restructuring costs, legacy items, transaction costs for acquisitions and divestitures, amortization of acquisition-related assets, debt modification costs, impairments, gains and losses on sale/disposition of business, and items that meet the conditions of unusual and/or infrequent and the tax effect of such adjustments. Legacy items include the resolution of and adjustments to certain contingent assets and liabilities related to acquisitions of continuing businesses and dispositions, including the separation of Wyndham Hotels and Cendant, and the sale of the vacation rentals businesses.

 

Average Number of Exchange Members: Represents paid members in our vacation exchange programs who are considered to be in good standing.

 

Free Cash Flow (FCF): A non-GAAP measure, defined by TNL as net cash provided by operating activities from continuing operations less property and equipment additions (capital expenditures) plus the sum of proceeds and principal payments of non-recourse vacation ownership debt. TNL believes FCF to be a useful operating performance measure to evaluate the ability of its operations to generate cash for uses other than capital expenditures and, after debt service and other obligations, its ability to grow its business through acquisitions and equity investments, as well as its ability to return cash to shareholders through dividends and share repurchases. A limitation of using FCF versus the GAAP measure of net cash provided by operating activities as a means for evaluating TNL is that FCF does not represent the total cash movement for the period as detailed in the consolidated statement of cash flows.

 

Gross Vacation Ownership Interest Sales: A non-GAAP measure, represents sales of vacation ownership interests (VOIs), including sales under the fee-for-service program before the effect of loan loss provisions. We believe that Gross VOI sales provide an enhanced understanding of the performance of our vacation ownership business because it directly measures the sales volume of this business during a given reporting period.

 

Leverage Ratio: The Company calculates leverage ratio as net debt divided by Adjusted EBITDA as defined in the credit agreement.

 

Net Debt: Net debt equals total debt outstanding, less non-recourse vacation ownership debt and cash and cash equivalents.

 

New owner sales, volume mix: Represents VOI sales (tour generated plus telephonic) to first time buyers as a percentage of total VOI sales.

 

New owner sales, transactions mix: Represents the number of first time buyer transactions as a percentage of the total number of VOIs sold during the period.

 

Tours: Represents the number of tours taken by guests in our efforts to sell VOIs.

 

Travel and Membership Revenue per Transaction: Represents transactional revenue divided by transactions, provided in two categories; Exchange, which is primarily RCI, and non-Exchange.

 

Travel and Membership Transactions: Represents the number of vacation bookings recognized as revenue during the period, net of cancellations, provided in two categories; Exchange, which is primarily RCI, and non-Exchange.

 

Volume Per Guest (VPG): Represents Gross VOI sales (excluding tele-sales upgrades, which are non-tour upgrade sales) divided by the number of tours. The Company has excluded non-tour upgrade sales in the calculation of VPG because non-tour upgrade sales are generated by a different marketing channel.

 

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