VAC Q3 2024 Earnings

Call Details

• Call Title: Marriott Vacations Q3 2024 Earnings Call
• Date: November 7, 2024 at 1:30 PM UTC
• Management Team:
  • Neal Goldner (Vice President, Investor Relations)
  • John Geller' (President and Chief Executive Officer)
  • Jason Marino (Executive Vice President and Chief Financial Officer)

Call Summary

Financial Performance

• Contract sales increased 5% year over year for the quarter, with a nearly 2% increase excluding Maui.
• Tours increased 10% year over year while overall VPG was 4% lower versus prior year.
• Vacation ownership revenue grew 9% year over year, helped by occupancy increasing 700 basis points year over year.
• Vacation ownership adjusted EBITDA was $231 million in the quarter, representing a 30% segment margin.
• Total company adjusted EBITDA increased year over year to $198 million for the quarter.
• Development profit increased to $105 million for the quarter.
• Delinquencies were roughly flat versus the second quarter and the sales reserve was in line with previous guidance.

Guidance

• Full-year adjusted EBITDA guidance was increased following the strong third quarter results.
• Full-year contract sales are still expected to grow 1% to 3% driven by increased tours and lower VPG.
• Adjusted free cash flow is expected to be in the $300 to $340 million range for the year.
• Exchange and third-party management adjusted EBITDA is now expected to decline approximately $30 million for the year.
• Vacation ownership rental profit is expected to increase in the $35 million range for the year.
• G&A for the full year is expected to be down around $20 million driven by cost-saving initiatives.
• Lost selling days from Hurricane Milton are estimated to cost approximately $8 million in contract sales and a few million dollars of adjusted EBITDA in Q4.