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Marriott Vacations Worldwide (“MVW”) Reports First Quarter 2021 Financial Results

ORLANDO, Fla. – May 5, 2021 – Marriott Vacations Worldwide Corporation (NYSE: VAC) today reported first quarter 2021 financial results.

“The past year has reminded us what is really important in life – family, experiences, and togetherness, all the things that travel offers.  As a company whose products enable these unique and memorable occasions, it’s been gratifying to see more and more people at our resorts this year, illustrating the desire of our customers to get back on vacation,” said Stephen P. Weisz, chief executive officer. “Our results this quarter are evidence of the continued recovery in our business and the resiliency of our business model. We generated $226 million in contract sales in the first quarter, a 27% sequential increase, and currently expect contract sales to increase to $320 million to $340 million in the second quarter.”

First Quarter 2021 Highlights and Operational Update:

• Consolidated Vacation Ownership contract sales totaled $226 million in the first quarter of 2021, with VPG increasing 26% compared to the prior year to $4,644.
• Net loss attributable to common shareholders was $28 million, or $0.68 loss per fully diluted share.
• Adjusted net loss attributable to common shareholders was $20 million and adjusted fully diluted loss per share was $0.49.
• Adjusted EBITDA was $69 million in the first quarter of 2021.
• Pro-forma for the acquisition of Welk Resorts, which closed on April 1, the Company had $1.4 billion of liquidity, including unrestricted cash and cash equivalents of $432 million.

First Quarter 2021 Segment Results

Vacation Ownership

Revenues excluding cost reimbursements decreased 30% in the first quarter of 2021 compared to the prior year but increased 14% from the fourth quarter of 2020 as the business continued to recover. Compared to the fourth quarter, revenue from the sale of vacation ownership products, rentals, and management and exchange increased 19%, 29%, and 5%, respectively.  Development profit increased 71% and Development profit margin increased approximately 250 basis points on a sequential basis.  Excluding the impact of revenue reportability, Adjusted development profit nearly tripled sequentially to $40 million, with Adjusted development profit margin more than doubling to 21%.

Vacation Ownership segment financial results were $44 million in the first quarter of 2021 and segment Adjusted EBITDA was $68 million.

Exchange & Third-Party Management

Revenues excluding cost reimbursements decreased 16% in the first quarter of 2021 compared to the prior year but increased 23% from the fourth quarter. Interval International exchange volumes increased 17% compared to the prior year and increased 27% from the fourth quarter of 2020. Active members declined 3% compared to the end of 2020 to nearly 1.5 million. Average revenue per member increased 14% compared to the prior year and increased 29% from the fourth quarter of 2020 as exchange and getaway rental activity increased.

Exchange & Third-Party Management segment financial results were $21 million in the first quarter of 2021 and segment Adjusted EBITDA was $41 million, with Adjusted EBITDA margin improving approximately 960 basis points year-over-year.

Corporate and Other

General and administrative costs declined $24 million in the first quarter of 2021 compared to the prior year primarily as a result of synergy efforts and lower costs associated with the furlough and reduced work week programs, including salary related costs.

Balance Sheet and Liquidity

On March 31, 2021, cash and cash equivalents totaled $643 million and the Company had $240 million of gross notes receivable that were eligible for securitization. 

During the first quarter, the Company issued $575 million of 0.00% Convertible Senior Notes due 2026 with an initial conversion price of $171.01 per share. To reduce the potential dilution to the Company’s earnings per share upon conversion of the Notes, the Company also entered into privately negotiated convertible note and warrant transactions at an initial strike price of $213.76 per share, which represented a premium of 75% over the last reported sale price of the Company’s common stock on January 27, 2021.

The Company had $4.4 billion in debt outstanding, net of unamortized debt issuance costs, at the end of the first quarter of 2021. This debt included $3.0 billion of corporate debt, after repaying $100 million of its outstanding term loan during the first quarter, and $1.4 billion of non-recourse debt related to its securitized notes receivable. 

Subsequent to the end of the quarter, the Company used $246 million to finance and consummate the acquisition of Welk Resorts, repay certain outstanding Welk Resorts debt and pay transaction expenses and other fees in connection with the transaction. Pro-forma for the acquisition, the Company had unrestricted cash of $432 million and gross notes receivable of $345 million that were eligible for securitization.

Non-GAAP Financial Information

Non-GAAP financial measures, such as Adjusted net loss attributable to common shareholders, Adjusted EBITDA, Adjusted fully diluted loss per share, Adjusted development profit, Adjusted development profit margin, and other adjusted financial measures, are reconciled and adjustments are shown and described in further detail in the Financial Schedules that follow.

First Quarter 2021 Financial Results Conference Call

The Company will hold a conference call on May 6, 2021 at 8:30 a.m. ET to discuss these financial results and provide an update on business conditions. Participants may access the call by dialing (877) 407-8289 or (201) 689-8341 for international callers. A live webcast of the call will also be available in the Investor Relations section of the Company’s website at ir.mvwc.com. An audio replay of the conference call will be available for 30 days on the Company’s website.

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About Marriott Vacations Worldwide Corporation

Marriott Vacations Worldwide Corporation is a leading global vacation company that offers vacation ownership, exchange, rental and resort and property management, along with related businesses, products and services. The Company has nearly 120 resorts and over 700,000 Owners and Members in a diverse portfolio that includes seven vacation ownership brands. It also includes exchange networks and membership programs comprised of nearly 3,200 resorts in over 90 nations and over 1.7 million members, as well as management of more than 160 other resorts and lodging properties. As a leader and innovator in the vacation industry, the Company upholds the highest standards of excellence in serving its customers, investors and associates while maintaining exclusive, long-term relationships with Marriott International, Inc. and Hyatt Hotels Corporation for the development, sales and marketing of vacation ownership products and services. For more information, please visit  www.marriottvacationsworldwide.com. 

Note on forward-looking statements

This press release and accompanying schedules contain “forward-looking statements” within the meaning of federal securities laws, including statements about expectations for contract sales in the second quarter, future operating results, estimates, and assumptions, and similar statements concerning anticipated future events and expectations that are not historical facts. The Company cautions you that these statements are not guarantees of future performance and are subject to numerous risks and uncertainties, including, without limitation, conditions beyond our control such as the length and severity of the current COVID-19 pandemic and its effect on our operations, its short and longer-term impacts on the demand for travel and consumer confidence, and the availability and distribution of effective vaccines; the pace of recovery following the COVID-19 pandemic or as effective treatments or vaccines become widely available; the Company’s ability to manage and reduce expenditures in a low revenue environment; volatility in the economy and the credit markets, changes in supply and demand for vacation ownership products, competitive conditions, the availability of additional financing when and if required, and other matters disclosed under the heading “Risk Factors” contained in the Company’s most recent Annual Report on Form 10-K filed with the U.S. Securities and Exchange Commission (the “SEC”) and in subsequent SEC filings, any of which could cause actual results to differ materially from those expressed in or implied in this press release. These statements are made as of the date of issuance and the Company undertakes no obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future events, or otherwise

For the Full Press Release with Financial Schedules Please Click the Link Below

https://ir.marriottvacationsworldwide.com/static-files/36a182f3-1d8a-4a99-9a2b-36b9a3b3199c