23 February, 2023

Marriott Vacations Worldwide reports fourth quarter and full 2022 results....

Marriott Vacations Worldwide Corporation has reported its financial results for the fourth quarter and full year of 2022 this week which showed the company had record of over $1.8 billion of contract sales.  

John Geller, president & chief executive officer said:  "2022 was a great year for Marriott Vacations Worldwide. We generated over $1.8 billion of contract sales, a new high for our Company, and returned more than $800 million in cash to shareholders. We also launched Abound by Marriott Vacations, added over 20,000 new owners in our Vacation Ownership business and grew active Interval International members by 21%. Looking forward, we expect occupancies in North America and Europe to remain strong this year and for Asia-Pacific to continue to improve. We also expect to grow contract sales this year by 5% to 9% compared to the prior year and for Adjusted Free Cash Flow to be between $600 million and $670 million, illustrating the continued demand for leisure travel and the strength of our business model."

Fourth Quarter 2022 Highlights:

Consolidated Vacation Ownership contract sales were $454 million, a 12% increase compared to the fourth quarter of 2021, and VPG was $4,088. The Company estimates that hurricanes negatively impacted contract sales by approximately $13 million in the fourth quarter of 2022.
Net income attributable to common shareholders was $88 million, or $2.08 fully diluted earnings per share.
Adjusted net income attributable to common shareholders was $115 million, or $2.74 Adjusted fully diluted earnings per share. The Company estimates that hurricanes negatively impacted Adjusted net income attributable to common shareholders by $5 million, or $0.12 per Adjusted fully diluted earnings per share.
Adjusted EBITDA was $239 million; excluding the impact of the Alignment (as defined below), Adjusted EBITDA increased 6% compared to the prior year fourth quarter to $232 million. The Company estimates that hurricanes negatively impacted Adjusted EBITDA by approximately $7 million in the fourth quarter of 2022.
The Company repurchased 1.2 million shares of its common stock for $173 million during the quarter at an average price per share of $139.90.

Full Year 2022 Highlights and 2023 Outlook:

Consolidated Vacation Ownership contract sales were $1.84 billion, a 34% increase compared to 2021, and VPG increased 1% to $4,421. The Company estimates that hurricanes negatively impacted contract sales by approximately $14 million in 2022.
Net income attributable to common shareholders was $391 million, or $8.77 fully diluted earnings per share.
Adjusted net income attributable to common shareholders was $458 million, or $10.26 Adjusted fully diluted earnings per share.
Adjusted EBITDA was $966 million; excluding the impact of the Alignment (as defined below), Adjusted EBITDA was $915 million, an increase of 39% compared to the prior year. The Company estimates that hurricanes negatively impacted Adjusted EBITDA by approximately $8 million in 2022.
During 2022, the Company repurchased 5.1 million shares of its common stock for $701 million at an average price of $137.83 and paid $99 million in dividends.
The Company expects contract sales in 2023 to grow 5% to 9% compared to the prior year and for Net income attributable to common shareholders to be $405 million to $440 million, or $9.51 to $10.30 fully diluted earnings per share.
Excluding the impact of the Alignment (as defined below) in 2022, the Company expects Adjusted EBITDA to grow 4% to 9% in 2023 and Adjusted earnings per share - diluted to increase 14% to 23%.


Fourth Quarter 2022 Results:

In the third quarter of 2022, in connection with the unification of the Company’s Marriott-, Westin-, and Sheraton-branded vacation ownership products under the Abound by Marriott Vacations program, the Company aligned its contract terms for the sale of vacation ownership products, resulting in the acceleration of revenue from the sale of Marriott-branded vacation ownership interests. In addition, the Company aligned its reserve methodology for these brands, resulting in an adjustment to its notes receivable reserve in the third quarter. Together, these changes are herein referred to as the “Alignment.” As a result of the Alignment, the Company reported an additional $5 million of Net income attributable to common shareholders and an additional $7 million of Adjusted EBITDA during the fourth quarter. The tables and financial schedules below illustrate the impact of the Alignment on the Company’s reported results.

Consolidated

 

Three Months Ended December 31, 2022

 

Three
Months
Ended
December
31, 2021

 

Change

 

As
Reported

 

Impact of
Alignment

 

As
Adjusted*

 

 

As Reported

 

As Adjusted*

($ in millions)

 

 

 

 

$

 

%

 

$

 

%

Net income attributable to common shareholders

$

88

 

 

$

(5

)

 

$

83

 

 

$

61

 

 

$

27

 

45

%

 

$

22

 

 

35

%

Adjusted net income attributable to common shareholders*

$

115

 

 

$

(5

)

 

$

110

 

 

$

103

 

 

$

12

 

 

12

%

 

$

7

 

6

%

Adjusted EBITDA*

$

239

 

 

$

(7

)

 

$

232

 

 

$

219

 

 

$

20

 

 

10

%

 

$

13

 

 

6

%

Adjusted EBITDA margin*

28.7%

 

 

 

28.2%

 

27.4%

 

1.3 pts

 

0.8 pts

Vacation Ownership

 

Three Months Ended December 31, 2022

 

Three
Months
Ended
December
31, 2021

 

Change

 

As
Reported

 

Impact of
Alignment

 

As
Adjusted*

 

 

As Reported

 

As Adjusted*

($ in millions)

 

 

 

 

$

 

%

 

$

 

%

Sale of vacation ownership products

$

439

 

 

$

(12

)

 

$

427

 

 

$

364

 

 

$

75

 

21

%

 

$

63

 

18

%

Development profit

$

162

 

 

$

(7

)

 

$

155

 

 

$

114

 

 

$

48

 

 

42

%

 

$

41

 

 

36

%

Segment financial results attributable to common shareholders

$

241

 

 

$

(5

)

 

$

236

 

 

$

205

 

 

$

36

 

 

17

%

 

$

31

 

 

14

%

Segment margin

31.9%

 

 

 

31.7%

 

29.3%

 

2.6 pts

 

2.4 pts

Segment Adjusted EBITDA*

$

261

 

 

$

(7

)

 

$

254

 

 

$

234

 

 

$

27

 

 

12

%

 

$

20

 

 

8

%

Segment Adjusted EBITDA margin*

34.6%

 

 

 

34.2%

 

33.4%

 

1.2 pts

 

0.8 pts

MARRIOTT VACATIONS WORLDWIDE CORPORATION
SUMMARY FINANCIAL INFORMATION

(In millions, except VPG, tours, total active members, average revenue per member and per share amounts)

(Unaudited)

 

Quarter Ended

 

Change %

 

Fiscal Year Ended

 

Change %

 

December
31, 2022

 

December
31, 2021

 

 

December
31, 2022

 

December
31, 2021

 

Key Measures

 

 

 

 

 

 

 

 

 

 

 

Total consolidated contract sales

$

454

 

$

406

 

12%

 

$

1,837

 

$

1,374

 

34%

VPG

$

4,088

 

 

$

4,305

 

 

(5%)

 

$

4,421

 

 

$

4,356

 

 

1%

Tours

 

105,231

 

 

 

89,495

 

 

18%

 

 

390,593

 

 

 

299,364

 

 

30%

Total active members (000's)(1)

 

1,566

 

 

 

1,296

 

 

21%

 

 

1,566

 

 

 

1,296

 

 

21%

Average revenue per member(1)

$

35.60

 

 

$

42.93

 

 

(17%)

 

$

157.97

 

 

$

179.48

 

 

(12%)

 

 

 

 

 

 

 

 

 

 

 

 

GAAP Measures

 

 

 

 

 

 

 

 

 

 

 

Revenues

$

1,188

 

 

$

1,100

 

 

8%

 

$

4,656

 

 

$

3,890

 

 

20%

Income before income taxes and noncontrolling interests

$

145

 

 

$

70

 

 

108%

 

$

582

 

 

$

127

 

 

NM

Net income attributable to common shareholders

$

88

 

 

$

61

 

 

45%

 

$

391

 

 

$

49

 

 

NM

Earnings per share - diluted

$

2.08

 

 

$

1.39

 

 

50%

 

$

8.77

 

 

$

1.13

 

 

NM

 

 

 

 

 

 

 

 

 

 

 

 

Non-GAAP Measures*

 

 

 

 

 

 

 

 

 

 

 

Adjusted EBITDA

$

239

 

 

$

219

 

 

10%

 

$

966

 

 

$

657

 

 

47%

Adjusted pretax income

$

169

 

 

$

131

 

 

30%

 

$

677

 

 

$

296

 

 

128%

Adjusted net income attributable to common shareholders

$

115

 

 

$

103

 

 

12%

 

$

458

 

 

$

190

 

 

140%

Adjusted earnings per share - diluted

$

2.74

 

 

$

2.38

 

 

15%

 

$

10.26

 

 

$

4.40

 

 

133%

 

 

 

 

 

 

 

 

 

 

 

 

Financial Measures, Excluding the Impact of Alignment*

 

 

 

 

 

 

 

 

Revenues

$

1,176

 

 

$

1,100

 

 

7%

 

$

4,617

 

 

$

3,890

 

 

19%

Income before income taxes and noncontrolling interests

$

138

 

 

$

70

 

 

97%

 

$

531

 

 

$

127

 

 

NM

Net income attributable to common shareholders

$

83

 

 

$

61

 

 

35%

 

$

353

 

 

$

49

 

 

NM

Earnings per share - diluted

$

1.94

 

 

$

1.39

 

 

40%

 

$

7.94

 

 

$

1.13

 

 

NM

Adjusted EBITDA

$

232

 

 

$

219

 

 

6%

 

$

915

 

 

$

657

 

 

39%

Adjusted pretax income

$

162

 

 

$

131

 

 

24%

 

$

626

 

 

$

296

 

 

111%

Adjusted net income attributable to common shareholders

$

110

 

 

$

103

 

 

6%

 

$

420

 

 

$

190

 

 

121%

Adjusted earnings per share - diluted

$

2.60

 

 

$

2.38

 

 

9%

 

$

9.42

 

 

$

4.40

 

 

114%

 

 

 

 

 

 

 

 

 

 

 

 

(1) Includes members at the end of each period for the Interval International exchange network only.

* Denotes non-GAAP financial measures. Please see “Non-GAAP Financial Measures” for additional information about our reasons for providing these alternative financial measures and limitations on their use.

NM = Not meaningful.







Q4 2022 Earnings Release (marriottvacationsworldwide.com)