Wyndham Worldwide Reports Fourth Quarter and Full Year 2009 Results
Company Triples Dividend Payout
Resumes Share Repurchase Program
Resumes Share Repurchase Program
PARSIPPANY, N.J., Feb. 10 /PRNewswire-FirstCall/ -- Wyndham Worldwide Corporation (NYSE: WYN) today announced results for the three months and year ended December 31, 2009. Separately, the Company also announced an increase in its quarterly cash dividend and that it plans to resume its share repurchase program.
FOURTH QUARTER and FULL-YEAR HIGHLIGHTS:
Wyndham Worldwide generated fourth quarter diluted earnings per share (EPS) of $0.40, compared with Company-issued guidance of $0.35 - $0.38. For the year ended December 31, 2009, the Company generated net cash from operating activities of approximately $690 million, compared with $109 million in 2008.
“We are pleased to report solid earnings and increasing free cash flow for the quarter and the year, and to announce an increase in our dividend along with our intention to resume our share repurchase program. While continuing high unemployment and economic uncertainty created a difficult operating environment, our results reflect resilient business models and strong execution,” said Stephen P. Holmes, chairman and CEO, Wyndham Worldwide. “Going forward, we remain focused on cash flow generation, transforming the Company by rebalancing our worldwide business portfolio to our fee-for-service businesses and positioning our businesses for future earnings growth.”
Increases Quarterly Dividend Payout
The Company’s Board of Directors authorized an increase of the quarterly cash dividend to $0.12 from $0.04 per share, beginning with the dividend that is expected to be declared in the first quarter of 2010. With this increase, the dividend is equivalent to an annual rate of $0.48 per share.
Resumes Share Repurchase Program
The Company plans to resume repurchase of its common stock under its existing $200 million stock repurchase program, which currently has $157 million remaining capacity. The amount and timing of specific repurchases are subject to market conditions, applicable legal requirements and other factors. Repurchases may be conducted in the open market or in privately negotiated transactions.
FOURTH QUARTER 2009 OPERATING RESULTS
Revenues for the fourth quarter of 2009 were $913 million, relatively flat compared with the prior-year period. Net income for the fourth quarter of 2009 was $73 million, or $0.40 diluted EPS, compared with a fourth quarter of 2008 net loss of $1.4 billion, or $7.63 loss per diluted share. The prior-year period includes the after-tax impact of $1.4 billion, or $8.10 per diluted share, of goodwill impairments, foreign currency losses, restructuring costs and legacy items. Excluding these items, adjusted net income would have been $84 million, or $0.47 diluted adjusted EPS for the fourth quarter of 2008.
FULL YEAR 2009 OPERATING RESULTS
Revenues for full year 2009 were $3.8 billion, a decline of 12% over the prior-year period, reflecting the following:
- Lodging revenues were $660 million, a 12% decrease compared with 2008, primarily resulting from a global decline in revenue per available room (RevPAR).
- Exchange and Rentals revenues were $1.2 billion, an 8% decrease compared with 2008, primarily resulting from unfavorable foreign exchange rate movements. In constant currency, revenues declined 2%.
- Vacation Ownership revenues were $1.9 billion, a 15% decrease compared with 2008, primarily resulting from the Company’s previously announced initiative to reduce capital deployed in the business, which included sales office closures and the elimination of certain marketing programs that resulted in fewer tours.
Net income for full year 2009 was $293 million, or $1.61 diluted EPS, compared with a prior-year period net loss of $1.1 billion, or $6.05 loss per diluted share. Adjusted net income for full year 2009 was $327 million, or $1.80 diluted EPS, compared with adjusted net income of $388 million, or $2.18 diluted adjusted EPS for full year 2008. Adjusted net income for full year 2009 excludes the after-tax impact of $34 million, or $0.19 per diluted share, of restructuring costs and legacy items. Adjusted net income for the prior-year period excludes the after-tax impact of $1.5 billion, or $8.23 per diluted share, of goodwill and other impairments, foreign currency losses, restructuring costs and legacy items.
FOURTH QUARTER 2009 BUSINESS UNIT RESULTS
Wyndham Hotel Group
Revenues were $149 million in the fourth quarter of 2009, a decline of 12% compared with the fourth quarter of 2008, primarily reflecting the global RevPAR decline.
System-wide RevPAR declined 11.9% in the fourth quarter of 2009. In constant currency, fourth quarter 2009 system-wide RevPAR decreased 13.3%, reflecting declines of 13.8% and 15.4% in domestic and international RevPAR, respectively.
Fourth quarter 2009 EBITDA was $32 million, compared with $38 million in the fourth quarter of 2008, which included a $16 million non-cash impairment charge. The year-over-year change reflects the global RevPAR decline, increased bad debt reserve primarily related to the hotel management business, and a non-cash impairment charge associated with an underperforming joint venture in the hotel management business, partially offset by cost containment initiatives.
As of December 31, 2009, the Company’s hotel system consisted of approximately 7,110 properties and 597,700 rooms, of which 22% were international. The development pipeline included approximately 950 hotels and 108,100 rooms, of which 51% were new construction and 43% were international.
Wyndham Exchange and Rentals
Revenues were $258 million in the fourth quarter of 2009, a 3% increase compared with the fourth quarter of 2008. In constant currency, revenues were relatively flat.
Annual dues and exchange revenues were $106 million, a 5% increase from the prior-year period. In constant currency, revenues increased $2 million, or 2% compared with the fourth quarter of 2008, driven by a 2% growth in the average number of members.
Vacation rental revenues were $122 million, an 8% increase from the prior-year period. In constant currency, revenues increased $2 million, or 2%, compared with the fourth quarter of 2008, primarily driven by a 3% increase in average price per vacation rental, partially offset by a 1% decrease in rental transaction volume.
Ancillary revenues were $30 million, a 17% decrease from the fourth quarter of 2008. In constant currency, revenues decreased 19% due primarily to lower fees generated from programs with affiliated resorts and our termination of a low margin travel service contract.
Fourth quarter 2009 EBITDA was $48 million, compared with a loss of $4 million in the fourth quarter of 2008, which included $67 million of asset impairments, foreign currency conversion losses and restructuring costs. Excluding these items and an unfavorable 2009 net effect of foreign currency of $15 million, 2009 EBITDA was flat, compared with 2008 adjusted EBITDA.
Wyndham Vacation Ownership
Driven by the previously announced initiative to reduce capital deployed in this business, gross vacation ownership interest (VOI) sales declined 21%, from the prior-year period, to $343 million in the fourth quarter of 2009. The year-over-year change reflects a 36% increase in volume per guest which partially offset the planned reduction in tour flow of 41%.
Total segment revenues were $508 million in the fourth quarter of 2009, a 3% increase from the fourth quarter of 2008. This change was driven by a decline in our provision for loan losses, a favorable impact from the percentage-of-completion (POC) method of accounting and higher ancillary revenue, partially offset by lower VOI sales. Under the POC method of accounting for VOI sales, the Company recognized $47 million of previously deferred revenue during the fourth quarter of 2009, compared with $14 million in the fourth quarter 2008.
EBITDA for the fourth quarter of 2009 was $132 million, compared with a loss of $1.3 billion in the fourth quarter of 2008, which included $1.4 billion of goodwill, other impairments and restructuring costs. Excluding these items, 2009 EBITDA increased $41 million, compared with the prior-year period, reflecting the net impact of the planned reduction in the VOI business and its related expenses, a lower provision for loan losses, and the impact from the net increase in the recognition of revenue previously deferred under the POC method of accounting.
Other Items
Net interest expense in the fourth quarter of 2009 was $33 million, a $15 million increase from the fourth quarter of 2008. The increase reflected lower capitalized interest and long-term debt issuances in May 2009, the proceeds of which were used primarily to reduce revolving credit facility borrowings, which had a lower interest rate.
Balance Sheet Information as of December 31, 2009:
- Cash and cash equivalents of approximately $155 million compared with $135 million at December 31, 2008
- Vacation ownership contract receivables, net, of $3.1 billion compared with $3.3 billion at December 31, 2008
- Vacation ownership and other inventory of $1.3 billion, unchanged from December 31, 2008
- Securitized vacation ownership debt of $1.5 billion compared with $1.8 billion at December 31, 2008
- Other debt of $2.0 billion, unchanged from December 31, 2008; remaining borrowing capacity on the revolving credit facility was approximately $870 million compared with approximately $290 million as of December 31, 2008
A schedule of debt is included in the financial tables section of this press release.
Guidance
The Company’s full-year 2010 guidance is:
- Revenues of $3.5 – $3.9 billion
- Adjusted EBITDA of $775 – $825 million
The guidance reflects assumptions used for internal planning purposes. All guidance excludes legacy items and restructuring costs, if any, which may have a positive or negative impact on reported results. If economic conditions improve or deteriorate materially from current levels, these assumptions and our guidance may change materially. It is not practicable to provide a reconciliation of forecasted adjusted EBITDA to the most directly comparable GAAP measure because certain items cannot be reasonably estimated or predicted at this time. Any such items could be significant to our financial results.
Conference Call Information
Wyndham Worldwide Corporation will provide a webcast of its conference call to discuss the Company’s fourth quarter and full year 2009 financial results on Wednesday, February 10, 2010 at 8:30 a.m. ET. Listeners can access the webcast live through the company’s website at www.wyndhamworldwide.com/investors/. The conference call also may be accessed by dialing (800) 369-2052 and providing the pass code "Wyndham." Listeners are urged to call at least 10 minutes prior to the scheduled start time. An archive of this webcast will be available on the website for approximately 90 days beginning at 12:00pm ET on February 10, 2010. A telephone replay will be available for approximately 90 days beginning at 12:00pm ET on February 10, 2010 at (866) 490-2538.
Presentation of Financial Information
Financial information discussed in this press release includes both GAAP and non-GAAP measures, which include or exclude certain items. These non-GAAP measures differ from reported results and are intended to illustrate what management believes are relevant period-over-period comparisons. A complete reconciliation of reported GAAP results to the comparable non-GAAP information appears in the financial tables section of the press release.
About Wyndham Worldwide
As one of the world’s largest hospitality companies, Wyndham Worldwide offers individual consumers and business-to-business customers a broad suite of hospitality products and services across various accommodation alternatives and price ranges through its premier portfolio of world-renowned brands. Wyndham Hotel Group encompasses approximately 7,110 franchised hotels and approximately 597,700 hotel rooms worldwide. Wyndham Exchange and Rentals offers leisure travelers, including its 3.8 million members, access to over 65,000 vacation properties located in approximately 100 countries. Wyndham Vacation Ownership develops, markets and sells vacation ownership interests and provides consumer financing to owners through its network of over 155 vacation ownership resorts serving over 820,000 owners throughout North America, the Caribbean and the South Pacific. Wyndham Worldwide, headquartered in Parsippany, N.J., employs approximately 25,000 employees globally.
For more information about Wyndham Worldwide, please visit the Company’s web site at www.wyndhamworldwide.com.
Forward-Looking Statements
This press release contains “forward-looking statements” within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended, conveying management’s expectations for the future, including, without limitation the information under the “Guidance”, which are based on plans, estimates and projections at the time the Company makes the statements. Forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of the Company to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. The forward-looking statements contained in this press release include statements related to the Company’s revenues, earnings, related financial and operating measures, dividend policy and share repurchases.
You are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of this press release. Factors that could cause actual results to differ materially from those in the forward-looking statements include general economic conditions, the performance of the financial and credit markets, changes in interest expense relating to the Company’s existing or future indebtedness, the economic environment for the hospitality industry, the impact of war and terrorist activity, operating risks associated with the hotel, vacation exchange and rentals and vacation ownership businesses, as well as those described in the Company’s Quarterly Report on Form 10-Q, filed with the SEC on November 5, 2009. Except for the Company’s ongoing obligations to disclose material information under the federal securities laws, it undertakes no obligation to release publicly any revisions to any forward-looking statements, to report events or to report the occurrence of unanticipated events.
Table 1
Wyndham Worldwide Corporation
OPERATING RESULTS OF REPORTABLE SEGMENTS
(In millions)
In addition to other measures, management evaluates the operating results
of each of its reportable segments based upon net revenues and “EBITDA,”
which is defined as net income/(loss) before depreciation and
amortization, interest expense (excluding consumer financing interest),
interest income (excluding consumer financing interest) and income taxes,
each of which is presented on the Company’s Consolidated Statements of
Operations. The Company believes that EBITDA is a useful measure of
performance for the Company's industry segments which, when considered
with GAAP measures, the Company believes gives a more complete
understanding of the Company's operating performance. The Company’s
presentation of EBITDA may not be comparable to similarly-titled measures
used by other companies.
The following tables summarize net revenues and EBITDA for reportable
segments, as well as reconcile EBITDA to net income/(loss) for the three
and twelve months ended December 31, 2009 and 2008:
Three Months Ended December 31,
-------------------------------
2009 2008
---- ----
Net Net
Revenues EBITDA Revenues EBITDA (f)
--------- -------- --------- --------
Lodging $149 $32 (c) $170 $38 (g)
Vacation Exchange
and Rentals 258 48 250 (4) (h)
Vacation Ownership 508 132 (d) 492 (1,321) (i)
--- --- --- ------
Total Reportable
Segments 915 212 912 (1,287)
Corporate and
Other (a) (b) (2) (18) (1) 7
-- --- -- -
Total Company $913 $194 $911 $(1,280)
==== ==== ==== =======
Reconciliation of EBITDA
to Net Income/(Loss)
------------------------
EBITDA $194 $(1,280)
Depreciation and
amortization 44 47
Interest expense 35 22
Interest income (2) (4)
-- --
Income/(loss) before
income taxes 117 (1,345)
Provision for income taxes 44 11
-- --
Net income/(loss) $73 $(1,356)
=== =======
Twelve Months Ended December 31,
--------------------------------
2009 2008
---- ----
Net Net
Revenues EBITDA (j) Revenues EBITDA (l)
--------- -------- --------- --------
Lodging $660 $175 (c) $753 $218 (g)
Vacation Exchange
and Rentals 1,152 287 1,259 248 (h)
Vacation Ownership 1,945 387 (k) 2,278 (1,074) (i)(m)
----- --- ----- ------
Total Reportable
Segments 3,757 849 4,290 (608)
Corporate and
Other (a) (e) (7) (71) (9) (27)
-- --- -- ---
Total Company $3,750 $778 $4,281 $(635)
====== ==== ====== =====
Reconciliation of EBITDA
to Net Income/(Loss)
------------------------
EBITDA $778 $(635)
Depreciation and
amortization 178 184
Interest expense 114 80
Interest income (7) (12)
-- ---
Income/(loss) before
income taxes 493 (887)
Provision for income taxes 200 187
--- ---
Net income/(loss) $293 $(1,074)
==== =======
----------
(a) Includes the elimination of transactions between segments.
(b) Includes $14 million ($7 million, net of tax) of a net benefit during
the three months ended December 31, 2008 related to the resolution of
and adjustment to certain contingent liabilities and assets.
(c) Includes a non-cash impairment charge of $6 million ($3 million,
net of tax) to reduce the value of an underperforming joint venture
in the Company's lodging property management business.
(d) Includes (i) restructuring costs of $1 million ($1 million, net of
tax) and (ii) a non-cash impairment charge of $1 million ($1 million,
net of tax) to reduce the value of assets held for sale related to
a vacation ownership property that is no longer consistent with the
Company's development plans.
(e) Includes $6 million ($6 million, net of tax) of a net expense and $18
million ($6 million, net of tax) of a net benefit during the twelve
months ended December 31, 2009 and 2008, respectively, related to the
resolution of and adjustment to certain contingent liabilities and
assets.
(f) Includes restructuring costs of $7 million and $66 million for
Vacation Exchange and Rentals and Vacation Ownership, respectively.
The after-tax impact of such costs is $45 million.
(g) Includes a non-cash impairment charge of $16 million ($10 million,
net of tax) related to the write down of franchise agreements of one
of the Company's brands.
(h) Includes (i) non-cash impairment charges of $36 million ($28 million,
net of tax) due to trademark and fixed asset write downs related to
the Company's vacation rentals businesses and the write-off of the
Company's investment in a joint venture and (ii) a cash charge of $24
million ($24 million, net of tax) due to foreign currency losses.
(i) Includes (i) a non-cash goodwill impairment charge of $1,342 million
($1,337 million, net of tax) to reflect reduced future cash flow
estimates and (ii) a non-cash impairment charge of $4 million ($3
million, net of tax) related to the termination of a development
project.
(j) Includes restructuring costs of $3 million, $6 million, $37 million
and $1 million for Lodging, Vacation Exchange and Rentals, Vacation
Ownership and Corporate and Other, respectively. The after-tax
impact of such costs is $29 million.
(k) Includes non-cash impairment charges of $9 million ($7 million, net
of tax) to reduce the value of certain vacation ownership properties
and related assets held for sale that are no longer consistent with
the Company's development plans.
(l) Includes restructuring costs of $4 million, $9 million and $66
million for Lodging, Vacation Exchange and Rentals and Vacation
Ownership, respectively. The after-tax impact of such costs is $49
million.
(m) Includes a non-cash impairment charge of $28 million ($17 million,
net of tax) due to the Company's initiative to rebrand its vacation
ownership trademarks to the Wyndham brand.
Table 2
Wyndham Worldwide Corporation
CONSOLIDATED STATEMENTS OF OPERATIONS
(In millions, except per share data)
Three Months Twelve Months
Ended Ended
December 31, December 31,
-------------- --------------
2009 2008 2009 2008
---- ---- ---- ----
Net revenues
Service fees and membership $371 $360 $1,613 $1,705
Vacation ownership interest sales 287 309 1,053 1,463
Franchise fees 98 113 440 514
Consumer financing 109 112 435 426
Other 48 17 209 173
-- -- --- ---
Net revenues 913 911 3,750 4,281
--- --- ----- -----
Expenses
Operating 356 337 1,501 1,622
Cost of vacation ownership interests 47 52 183 278
Consumer financing interest 37 37 139 131
Marketing and reservation 137 171 560 830
General and administrative (a) (b) 136 124 533 561
Goodwill and other impairments 7(c) 1,398(d) 15(c) 1,426(d)
Restructuring costs (e) 1 73 47 79
Depreciation and amortization 44 47 178 184
-- -- --- ---
Total expenses 765 2,239 3,156 5,111
--- ----- ----- -----
Operating income/(loss) 148 (1,328) 594 (830)
Other income, net (2) (1) (6) (11)
Interest expense 35 22 114 80
Interest income (2) (4) (7) (12)
-- -- -- ---
Income/(loss) before income taxes 117 (1,345) 493 (887)
Provision for income taxes 44 11 200 187
-- -- --- ---
Net income/(loss) $73 $(1,356) $293 $(1,074)
=== ======= ==== =======
Earnings/(losses) per share
Basic $0.41 $(7.63) $1.64 $(6.05)
Diluted 0.40 (7.63) 1.61 (6.05)
Weighted average shares outstanding
Basic 179 178 179 178
Diluted 184 178 182 178
----------
(a) Includes (i) $14 million ($7 million, net of tax) of a net benefit
during the three months ended December 31, 2008 and $6 million ($6
million, net of tax) of a net expense and $18 million ($6 million,
net of tax) of a net benefit during the twelve months ended December
31, 2009 and 2008, respectively, related to the resolution of and
loss to certain contingent liabilities and assets.
(b) Includes a cash charge of $24 million ($24 million, net of tax) for
Vacation Exchange and Rentals due to foreign currency losses during
the three and twelve months ended December 31, 2008.
(c) Represents (i) a non-cash impairment charge of $6 million ($3
million, net of tax) to reduce the value of an underperforming
joint venture in the Company's lodging property management business
and (ii) a non-cash impairment charge of $1 million ($1 million,
net of tax) to reduce the value of assets held for sale related
to a vacation ownership property that is no longer consistent with
the Company's development plans during the three and twelve
months ended December 31, 2009. The twelve months ended December 31,
2009 also includes non-cash impairment charges of $8 million ($6
million, net of tax) to reduce the value of certain other vacation
ownership properties and related assets held for sale that are no
longer consistent with the Company's development plans.
(d) Represents (i) a non-cash goodwill impairment charge of $1,342
million ($1,337 million, net of tax) for Vacation Ownership to
reflect reduced future cash flow estimates, (ii) non-cash impairment
charges of $36 million ($28 million, net of tax) for Vacation
Exchange and Rentals due to trademark and fixed asset write downs
related to the Company's vacation rentals businesses and the write-
off of the Company's investment in a joint venture, (iii) a non-cash
impairment charge of $16 million ($10 million, net of tax) for
Lodging related to the write down of franchise agreements of one of
the Company's brands and (iv) a non-cash impairment charge of $4
million ($3 million, net of tax) for Vacation Ownership related to
the termination of a development project during the three and twelve
months ended December 31, 2008. The twelve months ended December 31,
2008 also includes a non-cash impairment charge of $28 million ($17
million, net of tax) for Vacation Ownership due to the Company's
initiative to rebrand its vacation ownership trademarks to the
Wyndham brand.
(e) Relates to costs incurred as a result of various strategic
initiatives approved by the Company and commenced during 2008. Such
amounts, net of tax, were $1 million and $29 million during the three
and twelve months ended December 31, 2009, respectively, and $45
million and $49 million during the three and twelve months ended
December 31, 2008, respectively.
Table 3
(1 of 3)
Wyndham Worldwide Corporation
OPERATING STATISTICS
Full
Year Q1 Q2 Q3 Q4 Year
---- -- -- -- -- -----
Lodging (a)
Number of
Rooms (b) 2009 588,500 590,200 590,900 597,700 N/A
2008 551,100 551,500 583,400 592,900 N/A
2007 539,300 541,700 540,900 550,600 N/A
2006 525,500 535,900 533,700 543,200 N/A
RevPAR 2009 $27.69 $32.38 $34.81 $26.47 $30.34
2008 $32.21 $38.87 $41.93 $30.03 $35.74
2007 $31.35 $38.35 $43.10 $33.09 $36.48
2006 $30.45 $36.97 $40.82 $31.41 $34.95
Vacation Exchange
and Rentals
Average
Number of
Members (in
000s) 2009 3,789 3,795 3,781 3,765 3,782
2008 3,632 3,682 3,673 3,693 3,670
2007 3,474 3,506 3,538 3,588 3,526
2006 3,292 3,327 3,374 3,429 3,356
Annual Dues
and Exchange
Revenue Per
Member 2009 $134.38 $117.59 $116.76 $112.10 $120.22
2008 $150.84 $128.91 $124.51 $109.56 $128.37
2007 $155.60 $132.33 $131.38 $124.59 $135.85
2006 $152.10 $130.37 $132.31 $128.13 $135.62
Vacation Rental
Transactions
(in 000s) 2009 387 324 367 278 1,356
2008 387 319 360 282 1,347
2007 398 326 360 293 1,376
2006 385 310 356 293 1,344
Average Net
Price Per
Vacation
Rental 2009 $335.54 $422.00 $505.82 $436.79 $423.04
2008 $412.74 $477.63 $553.69 $400.09 $463.10
2007 $349.73 $415.71 $506.78 $426.93 $422.83
2006 $312.51 $374.91 $442.75 $356.16 $370.93
Vacation Ownership
Gross Vacation
Ownership
Interest
Sales (in
000s) 2009 $280,000 $327,000 $366,000 $343,000 $1,315,000
2008 $458,000 $532,000 $566,000 $432,000 $1,987,000
2007 $430,000 $523,000 $552,000 $488,000 $1,993,000
2006 $357,000 $434,000 $482,000 $469,000 $1,743,000
Tours 2009 137,000 164,000 173,000 142,000 617,000
2008 255,000 314,000 334,000 240,000 1,143,000
2007 240,000 304,000 332,000 268,000 1,144,000
2006 208,000 273,000 312,000 254,000 1,046,000
Volume Per
Guest (VPG) 2009 $1,866 $1,854 $1,944 $2,210 $1,964
2008 $1,668 $1,583 $1,550 $1,630 $1,602
2007 $1,607 $1,596 $1,545 $1,690 $1,606
2006 $1,475 $1,426 $1,434 $1,623 $1,486
----------
Note: Full year amounts may not foot across due to rounding.
(a) Quarterly drivers in the Lodging segment include the acquisitions of
Microtel Inns & Suites and Hawthorn Suites (July 2008) and Baymont
Inn & Suites (April 2006) from their acquisition dates forward.
Therefore, the operating statistics are not presented on a comparable
basis.
(b) Numbers include affiliated rooms from the fourth quarter of 2006
forward.
Table 3
(2 of 3)
Wyndham Worldwide Corporation
ADDITIONAL DATA
Full
Year Q1 Q2 Q3 Q4 Year
---- -- -- -- -- -----
Lodging (a)
Number of
Properties
(b) 2009 6,990 7,020 7,040 7,110 N/A
2008 6,550 6,560 6,970 7,040 N/A
2007 6,450 6,460 6,460 6,540 N/A
2006 6,300 6,440 6,420 6,470 N/A
Vacation Ownership
Deferred
Revenues (in
000s) (c) 2009 $66,516 $37,140 $36,102 $46,784 $186,543
2008 $(81,716) $(5,240) $(2,023) $13,870 $(75,108)
2007 $3,906 $(4,908) $506 $(21,092) $(21,588)
2006 $12,708 $(221) $(23,491) $(10,675) $(21,679)
Provision
for Loan
Losses (in
000s) (d) 2009 $107,202 $121,641 $117,111 $103,115 $449,069
2008 $82,344 $112,669 $118,609 $136,090 $449,712
2007 $60,869 $75,032 $85,762 $83,644 $305,307
2006 $61,242 $55,872 $63,213 $78,680 $259,007
----------
Note: Full year amounts may not foot across due to rounding.
(a) Information includes the acquisitions of Microtel Inns & Suites and
Hawthorn Suites (July 2008) and Baymont Inn & Suites (April 2006)
from their acquisition dates forward. Therefore, the data is not
presented on a comparable basis.
(b) Numbers include affiliated hotels from the fourth quarter of 2006
forward.
(c) Represents the revenue that is deferred under the percentage of
completion method of accounting. Under the percentage of completion
method of accounting, a portion of the total revenue from a vacation
ownership contract sale is not recognized if the construction of the
vacation resort has not yet been fully completed. This revenue will
be recognized in future periods in proportion to the costs incurred
as compared to the total expected costs for completion of
construction of the vacation resort. Positive amounts represent the
recognition of previously deferred revenues.
(d) Represents provision for estimated losses on vacation ownership
contract receivables originated during the period, which is recorded
as a contra revenue to vacation ownership interest sales on the
Consolidated Statements of Income.
Table 3
(3 of 3)
Wyndham Worldwide Corporation
OPERATING STATISTICS
GLOSSARY OF TERMS
-----------------
Lodging
Number of Rooms: Represents the number of rooms at lodging properties at
the end of the period which are either (i) under franchise and/or
management agreements, (ii) properties affiliated with Wyndham Hotels and
Resorts brand for which we receive a fee for reservation and/or other
services provided or (iii) properties managed under a joint venture.
Average Occupancy Rate: Represents the percentage of available rooms
occupied during the period.
Average Daily Rate (ADR): Represents the average rate charged for renting
a lodging room for one day.
RevPAR: Represents revenue per available room and is calculated by
multiplying average occupancy rate by ADR. Comparable RevPAR represents
RevPAR of hotels which are included in both periods.
Vacation Exchange and Rentals
Average Number of Members: Represents members in our vacation exchange
programs who pay annual membership dues. For additional fees, such
participants are entitled to exchange intervals for intervals at other
properties affiliated with our vacation exchange business. In addition,
certain participants may exchange intervals for other leisure-related
products and services.
Annual Dues and Exchange Revenue Per Member: Represents total revenues
from annual membership dues and exchange fees generated for the period
divided by the average number of vacation exchange members during the
year.
Vacation Rental Transactions: Represents the number of transactions that
are generated in connection with customers booking their vacation rental
stays through us. In our European vacation rentals businesses, one rental
transaction is recorded each time a standard one-week rental is booked;
however, in the United States, one rental transaction is recorded each
time a vacation rental stay is booked, regardless of whether it is less
than or more than one week.
Average Net Price Per Vacation Rental: Represents the net rental price
generated from renting vacation properties to customers divided by the
number of rental transactions.
Vacation Ownership
Gross Vacation Ownership Interest Sales: Represents gross sales of
vacation ownership interests (including tele-sales upgrades, which are a
component of upgrade sales) before deferred sales and loan loss
provisions.
Tours: Represents the number of tours taken by guests in our efforts to
sell vacation ownership interests.
Volume per Guest (VPG): Represents revenue per guest and is calculated by
dividing the gross vacation ownership interest sales, excluding tele-sales
upgrades, which are a component of upgrade sales, by the number of tours.
General
Constant Currency: Represents comparison eliminating the effects of
foreign exchange rate fluctuations between periods.
Table 4
Wyndham Worldwide Corporation
Revenue Detail by Reportable Segment
(In millions)
2009
----
Q1 Q2 Q3 Q4 Year
------ ------ ------ ------ --------
Lodging
Royalties and Franchise Fees $57 $68 $72 57 254
Marketing, Reservation and
Wyndham Rewards Revenues (a) 54 66 73 53 246
Property Management
Reimbursable Revenues (b) 22 23 21 19 85
Ancillary Revenues (c) 21 17 17 20 75
-- -- -- -- --
Total Lodging 154 174 183 149 660
--- --- --- --- ---
Vacation Exchange and Rentals
Exchange Revenues 127 112 110 106 455
Rental Revenues 130 137 185 122 574
Ancillary Revenues (d) 30 31 32 30 123
-- -- -- -- ---
Total Vacation Exchange and
Rentals 287 280 327 258 1,152
--- --- --- --- -----
Vacation Ownership
Vacation Ownership Interest
Sales 239 242 285 287 1,053
Consumer Financing 109 109 108 109 435
Property Management Fees 91 94 96 95 376
Ancillary Revenues (e) 23 22 19 17 81
-- -- -- -- --
Total Vacation Ownership 462 467 508 508 1,945
--- --- --- --- -----
Total Reportable Segments $903 $921 $1,018 $915 $3,757
==== ==== ====== ==== ======
2008
----
Q1 Q2 Q3 Q4 Year
------ ------ ------ ------ --------
Lodging
Royalties and Franchise Fees $64 $78 $88 $66 $297
Marketing, Reservation and
Wyndham Rewards Revenues (a) 60 75 84 61 280
Property Management
Reimbursable Revenues (b) 27 26 25 21 100
Ancillary Revenues (c) 19 21 16 22 76
-- -- -- -- --
Total Lodging 170 200 213 170 753
--- --- --- --- ---
Vacation Exchange and Rentals
Exchange Revenues 137 119 114 101 471
Rental Revenues 160 153 199 113 624
Ancillary Revenues (d) 44 42 41 36 164
-- -- -- -- ---
Total Vacation Exchange and
Rentals 341 314 354 250 1,259
--- --- --- --- -----
Vacation Ownership
Vacation Ownership Interest
Sales 294 414 446 309 1,463
Consumer Financing 99 104 111 112 426
Property Management Fees 85 84 89 89 346
Ancillary Revenues (e) 26 19 15 (18) 43
-- -- -- --- --
Total Vacation Ownership 504 621 661 492 2,278
--- --- --- --- -----
Total Reportable Segments $1,015 $1,135 $1,228 $912 $4,290
====== ====== ====== ==== ======
2007
----
Q1 Q2 Q3 Q4 Year
------ ------ ------ ------ --------
Lodging
Royalties and Franchise Fees $63 $78 $89 $67 $296
Marketing, Reservation and
Wyndham Rewards Revenues (a) 60 73 84 64 281
Property Management
Reimbursable Revenues (b) 16 22 26 28 92
Ancillary Revenues (c) 13 13 12 17 56
-- -- -- -- --
Total Lodging 152 186 211 176 725
--- --- --- --- ---
Vacation Exchange and Rentals
Exchange Revenues 135 116 116 112 479
Rental Revenues 139 136 182 125 582
Ancillary Revenues (d) 40 36 38 43 157
-- -- -- -- ---
Total Vacation Exchange and
Rentals 314 288 336 280 1,218
--- --- --- --- -----
Vacation Ownership
Vacation Ownership Interest
Sales 373 443 467 383 1,666
Consumer Financing 81 88 93 96 358
Property Management Fees 74 78 79 78 310
Ancillary Revenues (e) 21 20 32 19 91
-- -- -- -- --
Total Vacation Ownership 549 629 671 576 2,425
--- --- --- --- -----
Total Reportable Segments $1,015 $1,103 $1,218 $1,032 $4,368
====== ====== ====== ====== ======
2006
----
Q1 Q2 Q3 Q4 Year
------ ------ ------ ------ --------
Lodging
Royalties and Franchise Fees $59 $75 $81 $63 $278
Marketing, Reservation and
Wyndham Rewards Revenues (a) 58 70 78 60 266
Property Management
Reimbursable Revenues (b) 16 20 17 16 69
Ancillary Revenues (c) 11 11 13 13 48
-- -- -- -- --
Total Lodging 144 176 189 152 661
--- --- --- --- ---
Vacation Exchange and Rentals
Exchange Revenues 125 108 112 110 455
Rental Revenues 120 116 158 105 498
Ancillary Revenues (d) 37 37 40 51 166
-- -- -- -- ---
Total Vacation Exchange and
Rentals 282 261 310 266 1,119
--- --- --- --- -----
Vacation Ownership
Vacation Ownership Interest
Sales 309 377 396 379 1,461
Consumer Financing 65 70 77 79 291
Property Management Fees 58 60 66 68 253
Ancillary Revenues (e) 13 11 12 28 63
-- -- -- -- --
Total Vacation Ownership 445 518 551 554 2,068
--- --- --- --- -----
Total Reportable Segments $871 $955 $1,050 $972 $3,848
==== ==== ====== ==== ======
----------
Note: Full year amounts may not foot across due to rounding.
(a) Marketing and reservation revenues represent fees we receive
from franchised and managed hotels that are to be expended for
marketing purposes or the operation of a centralized, brand-
specific reservation system. These fees are typically based on a
percentage of the gross room revenues of each hotel. Wyndham
Rewards revenues represent fees we receive relating to our loyalty
program.
(b) Primarily represents payroll costs in our hotel management
business that we incur and pay on behalf of property owners and for
which we are reimbursed by the property owners.
(c) Primarily includes additional services provided to
franchisees.
(d) Primarily includes fees from additional services provided to
transacting members, fees from a credit card loyalty program and
fees generated from programs with affiliated resorts.
(e) Primarily includes revenues associated with bonus points/
credits that are provided as purchase incentives on VOI sales and
fees generated from other non-core businesses.
Table 5
Wyndham Worldwide Corporation
SCHEDULE OF DEBT
(In millions)
December 31, September 30, June 30, March 31, December 31,
2009 2009 2009 2009 2008
------------ ------------- -------- --------- ------------
Securitized
vacation
ownership debt
Term notes $1,112 $1,305 $1,290 $1,165 $1,252
Bank conduit
facilities (a) 395 299 340 569 558
--- --- --- --- ---
Securitized
vacation
ownership debt (b) 1,507 1,604 1,630 1,734 1,810
Less: Current
portion of
securitized
vacation
ownership debt 209 291 288 305 294
--- --- --- --- ---
Long-term
securitized
vacation
ownership debt $1,298 $1,313 $1,342 $1,429 $1,516
====== ====== ====== ====== ======
Debt:
6.00% senior
unsecured notes
(due December
2016) (c) $797 $797 $797 $797 $797
Term loan
(due July 2011) 300 300 300 300 300
Revolving credit
facility (due
July 2011) (d) - 21 30 517 576
9.875% senior
unsecured
notes (due
May 2014) (e) 238 237 237 - -
3.50% convertible
notes (due
May 2012) (f) 367 309 253 - -
Vacation ownership
bank borrowings (g) 153 163 154 156 159
Vacation rentals
capital leases 133 139 135 130 139
Other 27 23 22 13 13
-- -- -- -- --
Total debt 2,015 1,989 1,928 1,913 1,984
Less: Current
portion of debt 175 176 169 166 169
--- --- --- --- ---
Long-term debt $1,840 $1,813 $1,759 $1,747 $1,815
====== ====== ====== ====== ======
-----------
(a) Represents (i) a 364-day, non-recourse vacation ownership bank
conduit facility with a term through October 2010 and borrowing
capacity of $600 million and (ii) the outstanding balance of the
Company’s prior bank conduit facility through October 8, 2009, the
date on which such balance was repaid. At December 31, 2009, our
364-day facility has remaining borrowing capacity of $205 million.
(b) This debt is collateralized by $2,755 million, $2,947 million, $2,916
million, $3,005 million and $2,929 million of underlying vacation
ownership contract receivables and related assets at December 31,
2009, September 30, 2009, June 30, 2009, March 31, 2009 and December
31, 2008, respectively.
(c) The balance at December 31, 2009 represents $800 million aggregate
principal less $3 million of unamortized discount.
(d) The Company's revolving credit facility has a borrowing capacity of
$900 million. At December 31, 2009, the Company has $31 million of
outstanding letters of credit and a remaining borrowing capacity of
$869 million.
(e) Represents senior unsecured notes issued by the Company during May
2009. The balance at December 31, 2009 represents $250 million
aggregate principal less $12 million of unamortized discount.
(f) Represents cash convertible notes issued by the Company during May
2009. At December 31, 2009, such balance includes $191 million of
debt ($230 million aggregate principal less $39 million of
unamortized discount) and a liability with a fair value of $176
million related to a bifurcated conversion feature.
(g) Represents a 364-day, AUD 213 million, secured, revolving foreign
credit facility, which expires in June 2010.
Table 6
(1 of 2)
Wyndham Worldwide Corporation
HOTEL BRAND SYSTEMS DETAILS
As of and For the Three Months Ended December 31, 2009
------------------------------------------------------
Average
Revenue
Average Per
Average Daily Available
Number of Number of Occupancy Rate Room
Brand Properties Rooms Rate (ADR) (RevPAR)
----- ----------- --------- ---------- ------- ----------
Wyndham Hotels
and Resorts 94 24,517 50.5% $108.64 $54.83
Wingate by
Wyndham 166 15,239 49.3% $78.41 $38.65
Hawthorn Suites
by Wyndham 89 8,238 46.7% $76.24 $35.62
Ramada 910 118,880 43.8% $75.97 $33.28
Baymont 240 20,459 40.2% $58.50 $23.50
Days Inn 1,858 149,633 39.0% $58.96 $23.01
Super 8 2,137 132,876 42.9% $53.87 $23.11
Howard Johnson 492 46,748 38.9% $58.18 $22.65
Travelodge 460 34,098 38.4% $59.37 $22.77
Microtel Inns
& Suites 314 22,376 43.5% $55.15 $23.97
Knights Inn 343 21,061 33.7% $40.24 $13.57
Unmanaged,
Affiliated and
Managed,
Non-Proprietary
Hotels (*) 11 3,549 N/A N/A N/A
----- -------
Total 7,114 597,674 41.6% $63.62 $26.47
===== =======
As of and For the Three Months Ended December 31, 2008
------------------------------------------------------
Average
Revenue
Average Per
Average Daily Available
Number of Number of Occupancy Rate Room
Brand Properties Rooms Rate (ADR) (RevPAR)
----- ----------- --------- ---------- ------- ----------
Wyndham Hotels
and Resorts 82 21,724 53.2% $111.86 $59.49
Wingate by
Wyndham 164 15,051 51.5% $90.77 $46.76
Hawthorn Suites
by Wyndham 90 8,423 53.1% $86.20 $45.73
Ramada 897 114,986 48.1% $79.31 $38.15
Baymont 227 19,090 45.4% $64.60 $29.35
Days Inn 1,880 152,971 43.4% $60.17 $26.09
Super 8 2,110 130,920 47.2% $55.82 $26.37
Howard Johnson 482 47,177 41.9% $60.04 $25.16
Travelodge 479 36,154 41.2% $57.40 $23.63
Microtel Inns
& Suites 308 22,106 51.4% $56.88 $29.22
Knights Inn 301 19,542 36.9% $42.39 $15.65
Unmanaged,
Affiliated and
Managed,
Non-Proprietary
Hotels (*) 23 4,736 N/A N/A N/A
----- -------
Total 7,043 592,880 45.7% $65.68 $30.03
===== =======
----------
NOTE: A glossary of terms is included in Table 3 (3 of 3).
(*) Represents (i) affiliated properties for which we receive a fee for
reservation services provided and (ii) properties managed under a
joint venture. These properties are not branded; as such, certain
operating statistics (such as average occupancy rate, ADR and RevPAR)
are not relevant. December 31, 2008 amounts also include AmeriHost
branded properties.
Table 6
(2 of 2)
Wyndham Worldwide Corporation
HOTEL BRAND SYSTEMS DETAILS
As of and For the Twelve Months Ended December 31, 2009
-------------------------------------------------------
Average
Revenue
Average Per
Average Daily Available
Number of Number of Occupancy Rate Room
Brand Properties Rooms Rate (ADR) (RevPAR)
----- ----------- --------- ---------- ------- ----------
Wyndham Hotels
and Resorts 94 24,517 52.6% $114.56 $60.21
Wingate by
Wyndham 166 15,239 53.6% $83.16 $44.54
Hawthorn
Suites by
Wyndham 89 8,238 51.6% $83.55 $43.10
Ramada 910 118,880 47.0% $74.55 $35.04
Baymont 240 20,459 45.2% $62.46 $28.25
Days Inn 1,858 149,633 44.9% $62.24 $27.95
Super 8 2,137 132,876 48.5% $56.67 $27.48
Howard Johnson 492 46,748 42.2% $61.22 $25.86
Travelodge 460 34,098 43.4% $61.87 $26.85
Microtel Inns &
Suites 314 22,376 49.0% $56.72 $27.79
Knights Inn 343 21,061 37.2% $42.46 $15.79
Unmanaged,
Affiliated
and Managed,
Non-Proprietary
Hotels (*) 11 3,549 N/A N/A N/A
----- -------
Total 7,114 597,674 46.3% $65.52 $30.34
===== =======
As of and For the Twelve Months Ended December 31, 2008
-------------------------------------------------------
Average
Revenue
Average Per
Average Daily Available
Number of Number of Occupancy Rate Room
Brand Properties Rooms Rate (ADR) (RevPAR)
----- ----------- --------- ---------- ------- ----------
Wyndham Hotels
and Resorts 82 21,724 61.0% $120.79 $73.67
Wingate by
Wyndham 164 15,051 59.5% $92.29 $54.94
Hawthorn
Suites by
Wyndham 90 8,423 57.7% $88.57 $51.14
Ramada 897 114,986 52.6% $81.62 $42.94
Baymont 227 19,090 49.7% $65.96 $32.80
Days Inn 1,880 152,971 49.9% $64.57 $32.19
Super 8 2,110 130,920 53.8% $59.38 $31.95
Howard Johnson 482 47,177 46.9% $64.62 $30.28
Travelodge 479 36,154 48.3% $67.50 $32.64
Microtel Inns &
Suites 308 22,106 54.3% $60.00 $32.55
Knights Inn 301 19,542 41.0% $43.40 $17.80
Unmanaged,
Affiliated
and Managed,
Non-Proprietary
Hotels (*) 23 4,736 N/A N/A N/A
----- -------
Total 7,043 592,880 51.4% $69.52 $35.74
===== =======
----------
NOTE: A glossary of terms is included in Table 3 (3 of 3).
(*) Represents (i) affiliated properties for which we receive a fee for
reservation services provided and (ii) properties managed under a
joint venture. These properties are not branded; as such, certain
operating statistics (such as average occupancy rate, ADR and RevPAR)
are not relevant. December 31, 2008 amounts also include AmeriHost
branded properties.
Table 7
(1 of 2)
Wyndham Worldwide Corporation
NON-GAAP RECONCILIATIONS
(In millions, except per share data)
Twelve Months
Three Months Ended Ended
------------------ --------------
March June September December December
31, 30, 30, 31, 31,
2009 2009 2009 2009 2009
------ ----- --------- --------- ---------
Reported EBITDA $134 $196 $254 $194 $778
Resolution of and
adjustment to
contingent
liabilities and
assets (a) 4 - 2 - 6
Restructuring
costs (b) 43 3 - - 46
-- - - - --
Adjusted EBITDA $181 $199 $256 $194 $830
--------------- ---- ---- ---- ---- ----
Reported PreTax
Income $74 $127 $175 $117 $493
Resolution of and
adjustment to
contingent
liabilities and
assets (a) 4 - 2 - 6
Restructuring
costs (b) 43 3 - - 46
-- - - - --
Adjusted PreTax
Income $121 $130 $177 $117 $545
--------------- ---- ---- ---- ---- ----
Reported Tax
Provision $(29) $(56) $(71) $(44) $(200)
Resolution of and
adjustment to
contingent
liabilities and
assets (c) (2) 2 - - -
Restructuring
costs (c) (16) (1) - - (18)
--- -- - - ---
Adjusted Tax
Provision $(47) $(55) $(71) $(44) $(218)
------------ ---- ---- ---- ---- -----
Reported Net Income $45 $71 $104 $73 $293
Resolution of and
adjustment to
contingent
liabilities and
assets 2 2 2 - 6
Restructuring
costs 27 2 - - 28
-- - - - --
Adjusted Net Income $74 $75 $106 $73 $327
------------------- --- --- ---- --- ----
Reported Diluted EPS $0.25 $0.39 $0.57 $0.40 $1.61
Resolution of and
adjustment to
contingent
liabilities and
assets 0.01 0.01 0.01 - 0.03
Restructuring
costs 0.15 0.01 - - 0.16
---- ---- ---- ---- ----
Adjusted Diluted EPS $0.41 $0.41 $0.58 $0.40 $1.80
-------------------- ----- ----- ----- ----- -----
Diluted Shares 178 182 183 184 182
----------
Note: Amounts may not foot across due to rounding.
(a) Relates to the net expense from the resolution of and adjustment to
certain contingent liabilities and assets.
(b) Relates to costs incurred as a result of various strategic
initiatives commenced by the Company during 2008.
(c) Relates to the tax effect of the adjustments.
Table 7
(2 of 2)
Wyndham Worldwide Corporation
NON-GAAP RECONCILIATIONS
(In millions, except per share data)
Twelve Months
Three Months Ended Ended
------------------ --------------
March June September December December
31, 30, 30, 31, 31,
2008 2008 2008 2008 2008
----- ----- ---------- --------- ---------
Reported EBITDA $130 $221 $294 $(1,280) $(635)
Goodwill
impairment (a) - - - 1,342 1,342
Other impairments
(b) 28 - - 56 84
Foreign currency
losses (c) - - - 24 24
Resolution of and
adjustment to
contingent
liabilities and
assets (d) 3 (7) 1 (14) (18)
Restructuring
costs (e) - - 6 73 79
- - - -- --
Adjusted EBITDA $161 $214 $301 $201 $876
--------------- ---- ---- ---- ---- ----
Reported PreTax
Income/(Loss) $70 $160 $228 $(1,345) $(887)
Goodwill
impairment (a) - - - 1,342 1,342
Other impairments
(b) 28 - - 56 84
Foreign currency
losses (c) - - - 24 24
Resolution of and
adjustment to
contingent
liabilities and
assets (d) 3 (7) 1 (14) (18)
Restructuring
costs (e) - - 6 73 79
- - - -- --
Adjusted PreTax
Income $101 $153 $235 $136 $624
--------------- ---- ---- ---- ---- ----
Reported Tax
Provision $(28) $(62) $(86) $(11) $(187)
Goodwill
impairment (f) - - - (5) (5)
Other impairments
(f) (11) - - (15) (26)
Foreign currency
losses (f) - - - - -
Resolution of and
adjustment to
contingent
liabilities and
assets (f) - 3 1 7 12
Restructuring
costs (f) - - (2) (28) (30)
- - -- --- ---
Adjusted Tax
Provision $(39) $(59) $(87) $(52) $(236)
------------ ---- ---- ---- ---- -----
Reported Net Income/
(Loss) $42 $98 $142 $(1,356) $(1,074)
Goodwill
impairment - - - 1,337 1,337
Other impairments 17 - - 41 58
Foreign currency
losses - - - 24 24
Resolution of and
adjustment to
contingent
liabilities and
assets 3 (4) 2 (7) (6)
Restructuring
costs - - 4 45 49
- - - -- --
Adjusted Net Income $62 $94 $148 $84 $388
------------------- --- --- ---- --- ----
Reported Diluted EPS $0.24 $0.55 $0.80 $(7.63) $(6.05)
Goodwill
impairment - - - 7.52 7.51
Other impairments 0.10 - - 0.23 0.32
Foreign currency
losses - - - 0.14 0.14
Resolution of and
adjustment to
contingent
liabilities and
assets 0.01 (0.02) 0.01 (0.04) (0.03)
Restructuring
costs - - 0.02 0.25 0.28
- - ---- ---- ----
Adjusted Diluted EPS $0.35 $0.53 $0.83 $0.47 $2.18
-------------------- ----- ----- ----- ----- -----
Diluted Shares 178 178 178 178 178
----------
Note: Amounts may not foot due to rounding.
(a) Represents a non-cash goodwill impairment charge for Vacation
Ownership to reflect reduced future cash flow estimates.
(b) During the three months ended March 31, 2008, represents a non-cash
impairment charge of $28 million ($17 million, net of tax) for
Vacation Ownership due to the Company's initiative to rebrand its
vacation ownership trademarks to the Wyndham brand. During the three
months ended December 31, 2008, represents (i) non-cash impairment
charges of $36 million ($28 million, net of tax) for Vacation
Exchange and Rentals due to trademark and fixed asset write downs
related to the Company's vacation rentals businesses and the write-
off of the Company's investment in a joint venture, (iii) a non-cash
impairment charge of $16 million ($10 million, net of tax) for
Lodging related to the write down of franchise agreements of one of
the Company's brands and (iv) a non-cash impairment charge of $4
million ($3 million, net of tax) for Vacation Ownership related to
the termination of a development project.
(c) Represents a cash charge for Vacation Exchange and Rentals due to
foreign currency losses.
(d) Relates to the net (benefit)/expense from the resolution of and
adjustment to certain contingent liabilities and assets.
(e) Relates to costs incurred as a result of various strategic
initiatives approved by the Company and commenced during the third
quarter of 2008.
(f) Relates to the tax effect of the adjustments.
Table 8
(1 of 3)
Wyndham Worldwide Corporation
NON-GAAP FINANCIAL INFORMATION
(In millions, except per share data)
Twelve Months Ended December 31, 2009
-------------------------------------
As Legacy Restructuring As
Reported Adjustments Costs Adjusted
-------- ----------- -------------- --------
Net revenues
Service fees and
membership $1,613 $1,613
Vacation
ownership
interest sales 1,053 1,053
Franchise fees 440 440
Consumer
financing 435 435
Other 209 209
--- - - ---
Net revenues 3,750 - - 3,750
----- - - -----
Expenses
Operating 1,501 1,501
Cost of vacation
ownership
interests 183 183
Consumer
financing
interest 139 139
Marketing and
reservation 560 560
General and
administrative 533 (6) (a) 527
Goodwill and other
impairments 15 15
Restructuring
costs 47 (46) (b) 1
Depreciation and
amortization 178 178
--- --- --- ---
Total expenses 3,156 (6) (46) 3,104
----- --- --- -----
Operating income 594 6 46 646
Other income, net (6) (6)
Interest expense 114 114
Interest income (7) (7)
--- --
Income before
income taxes 493 6 46 545
Provision for
income taxes 200 - (c) 18 (c) 218
--- --- ---- ---
Net income $293 $6 $28 $327
==== == === ====
Earnings per share
Basic $1.64 $0.03 $0.16 $1.83
Diluted 1.61 0.03 0.16 1.80
Weighted average shares
outstanding
Basic 179 179 179 179
Diluted 182 182 182 182
----------
(a) Relates to the net expense from the resolution of and adjustment to
certain contingent liabilities and assets.
(b) Relates to costs incurred as a result of various strategic
initiatives commenced by the Company during 2008.
(c) Relates to the tax effect of the adjustments.
Table 8
(2 of 3)
Wyndham Worldwide Corporation
NON-GAAP FINANCIAL INFORMATION
(In millions, except per share data)
Three Months Ended December 31, 2008
------------------------------------
Foreign
As Goodwill Other Currency
Reported Impairment Impairments Losses
-------- ---------- ----------- --------
Net revenues
Service fees
and membership $360
Vacation ownership
interest sales 309
Franchise fees 113
Consumer financing 112
Other 17
-- - - -
Net revenues 911 - - -
--- - - -
Expenses
Operating 337
Cost of vacation
ownership interests 52
Consumer financing
interest 37
Marketing and
reservation 171
General and
administrative 124 (24) (c)
Goodwill and other
impairments 1,398 (1,342) (a) (56) (b)
Restructuring costs 73
Depreciation and
amortization 47
-- ------ --- ---
Total expenses 2,239 (1,342) (56) (24)
----- ------ --- ---
Operating income/
(loss) (1,328) 1,342 56 24
Other income, net (1)
Interest expense 22
Interest income (4)
-- -- -- --
Income/(loss)
before income
taxes (1,345) 1,342 56 24
Provision for
income taxes 11 5 (f) 15 (f) - (f)
-- - -- -
Net income/(loss) $(1,356) $1,337 $41 $24
======= ====== === ===
Earnings/(losses)
per share $(7.63) $7.52 $0.23 $0.14
Weighted average
shares outstanding 178 178 178 178
Three Months Ended December 31, 2008
------------------------------------
Legacy Restructuring As
Adjustments Costs Adjusted
----------- ------------- --------
Net revenues
Service fees and
membership $360
Vacation ownership
interest sales 309
Franchise fees 113
Consumer financing 112
Other 17
- - --
Net revenues - - 911
- - ---
Expenses
Operating 337
Cost of vacation
ownership interests 52
Consumer financing
interest 37
Marketing and
reservation 171
General and
administrative 14 (d) 114
Goodwill and other
impairments -
Restructuring costs (73) (e) -
Depreciation and
amortization 47
-- --- --
Total expenses 14 (73) 758
-- --- ---
Operating income/(loss) (14) 73 153
Other income, net (1)
Interest expense 22
Interest income (4)
-- -- --
Income/(loss) before
income taxes (14) 73 136
Provision for
income taxes (7) (f) 28 (f) 52
-- -- --
Net income/(loss) $(7) $45 $84
=== === ===
Earnings/(losses)
per share $(0.04) $0.25 $0.47
Weighted average
shares outstanding 178 178 178
----------
(a) Represents a non-cash goodwill impairment charge for Vacation
Ownership to reflect reduced future cash flow estimates.
(b) Represents (i) non-cash impairment charges of $36 million ($28
million, net of tax) for Vacation Exchange and Rentals due to
trademark and fixed asset write downs related to the Company's
vacation rentals businesses and the write-off of the Company's
investment in a joint venture, (ii) a non-cash impairment charge of
$16 million ($10 million, net of tax) for Lodging related to the
write down of franchise agreements of one of the Company's brands and
(iii) a non-cash impairment charge of $4 million ($3 million, net of
tax) for Vacation Ownership related to the termination of a
development project.
(c) Represents a cash charge for Vacation Exchange and Rentals due to
foreign currency losses.
(d) Relates to the net benefit from the resolution of and adjustment to
certain contingent liabilities and assets.
(e) Relates to costs incurred as a result of various strategic
initiatives commenced by the Company during 2008.
(f) Relates to the tax effect of the adjustment.
Table 8
(3 of 3)
Wyndham Worldwide Corporation
NON-GAAP FINANCIAL INFORMATION
(In millions, except per share data)
Twelve Months Ended December 31, 2008
-------------------------------------
Foreign
As Goodwill Other Currency
Reported Impairment Impairments Losses
-------- ---------- ----------- --------
Net revenues
Service fees and
membership $1,705
Vacation ownership
interest sales 1,463
Franchise fees 514
Consumer financing 426
Other 173
--- - - -
Net revenues 4,281 - - -
----- - - -
Expenses
Operating 1,622
Cost of vacation
ownership interests 278
Consumer financing
interest 131
Marketing and
reservation 830
General and
administrative 561 (24) (c)
Goodwill and
other impairments 1,426 (1,342) (a) (84) (b)
Restructuring costs 79
Depreciation and
amortization 184
--- ------ --- ---
Total expenses 5,111 (1,342) (84) (24)
----- ------ --- ---
Operating income/
(loss) (830) 1,342 84 24
Other income, net (11)
Interest expense 80
Interest income (12)
--- --- --- ---
Income/(loss)
before income taxes (887) 1,342 84 24
Provision for income
taxes 187 5 (f) 26 (f) - (f)
--- - -- -
Net income/ (loss) $(1,074) $1,337 $58 $24
======= ====== === ===
Earnings/(losses)
per share
Basic $(6.05) $7.53 $0.33 $0.14
Diluted (6.05) 7.51 0.32 0.14
Weighted average
shares outstanding
Basic 178 178 178 178
Diluted 178 178 178 178
Twelve Months Ended December 31, 2008
-------------------------------------
Legacy Restructuring As
Adjustments Costs Adjusted
----------- ------------- --------
Net revenues
Service fees and
membership $1,705
Vacation ownership
interest sales 1,463
Franchise fees 514
Consumer financing 426
Other 173
- - ---
Net revenues - - 4,281
- - -----
Expenses
Operating 1,622
Cost of vacation
ownership interests 278
Consumer financing
interest 131
Marketing and
reservation 830
General and
administrative 18 (d) 555
Goodwill and
other impairments -
Restructuring costs (79) (e) -
Depreciation and
amortization 184
-- --- ---
Total expenses 18 (79) 3,600
-- --- -----
Operating income/
(loss) (18) 79 681
Other income, net (11)
Interest expense 80
Interest income (12)
--- --- ---
Income/(loss) before
income taxes (18) 79 624
Provision for income
taxes (12) (f) 30 (f) 236
--- -- ---
Net income/(loss) $(6) $49 $388
=== === ====
Earnings/(losses)
per share
Basic $(0.03) $0.28 $2.19
Diluted (0.03) 0.28 2.18
Weighted average
shares outstanding
Basic 178 178 178
Diluted 178 178 178
-----------
Note: EPS amounts may not foot across due to rounding.
(a) Represents a non-cash goodwill impairment charge for Vacation
Ownership to reflect reduced future cash flow estimates.
(b) Represents (i) non-cash impairment charges of $36 million ($28
million, net of tax) for Vacation Exchange and Rentals due to
trademark and fixed asset write downs related to the Company's
vacation rentals businesses and the write-off of the Company's
investment in a joint venture, (ii) a non-cash impairment charge of
$28 million ($17 million, net of tax) for Vacation Ownership due to
the Company's initiative to rebrand its vacation ownership trademarks
to the Wyndham brand, (iii) a non-cash impairment charge of $16
million ($10 million, net of tax) for Lodging related to the write
down of franchise agreements of one of the Company's brands and (iv)
a non-cash impairment charge of $4 million ($3 million, net of tax)
for Vacation Ownership related to the termination of a development
project.
(c) Represents a cash charge for Vacation Exchange and Rentals due to
foreign currency losses.
(d) Relates to the net benefit from the resolution of and adjustment to
certain contingent liabilities and assets.
(e) Relates to costs incurred as a result of various strategic
initiatives commenced by the Company during 2008.
(f) Relates to the tax effect of the adjustments.
SOURCE Wyndham Worldwide Corporation
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