Wyndham Worldwide Reports Third Quarter 2009 Results
Increases 2009 Adjusted EBITDA Guidance
PARSIPPANY, N.J., Oct. 28, 2009 — Wyndham Worldwide Corporation (NYSE: WYN) today announced results for the three months ended September 30, 2009.
HIGHLIGHTS:
- Wyndham Worldwide generated diluted adjusted earnings per share (EPS) of $0.58, compared with Company-issued guidance of $0.53 – $0.57. Reported EPS was $0.57. The Company raises full-year 2009 adjusted EBITDA guidance to $775 -$825 million, compared with prior guidance of $760 – $810 million.
- For the nine months ended September 30, 2009, the Company generated net cash from operating activities of approximately $570 million, compared with $146 million in 2008.
- Wyndham Worldwide recently completed two term securitization transactions totaling $350 million.
- The Company announces the renewal of its asset-backed vacation ownership receivables conduit. The 364-day facility bears interest at variable commercial paper rates plus a spread with a capacity of $600 million.
“Wyndham Worldwide delivered solid results in the third quarter, once again demonstrating the benefits of a strong, resilient business model and excellent execution” said Stephen P. Holmes, chairman and CEO, Wyndham Worldwide. “We continue to transform the Company by rebalancing our worldwide business portfolio to increase the contribution of fee-for-service businesses and drive strong cash flow.”
THIRD QUARTER 2009 COMPANY OPERATING RESULTS
Third quarter revenues of $1,016 million declined by 17% from the prior-year period due to the previously announced initiative to reduce the deployment of capital in the Company’s vacation ownership business; continued weakness in the global lodging industry; and unfavorable foreign exchange rate movements which negatively impacted the Company’s exchange and rentals business.
Net income for the third quarter of 2009 was $104 million, or $0.57 diluted EPS, compared with third quarter 2008 net income of $142 million, or $0.80 diluted EPS.
Adjusted net income for the third quarter of 2009 was $106 million, or $0.58 diluted adjusted EPS, compared with third quarter 2008 adjusted net income of $148 million, or $0.83 diluted adjusted EPS. Third quarter 2009 includes the after-tax impact of $2 million, or $0.01 diluted EPS, of legacy items. Third quarter 2008 net income includes the after-tax impact of $6 million, or $0.03 diluted EPS, of restructuring costs and legacy items.
Wyndham Vacation Ownership results were as follows:
Gross Vacation Ownership Interest (VOI) sales were $366 million for the third quarter of 2009, a 35% decline from the third quarter of 2008. This decrease was primarily driven by the previously announced initiative to reduce the capital deployed in this business, which included sales office closures and a reduction of marketing efforts that resulted in fewer tours.
Total segment revenues were $508 million in the third quarter of 2009, down 23% from the third quarter of 2008, primarily reflecting the planned reduction in tour flow which was partially offset by a 25% increase in volume per guest and a $38 million favorable impact from the percentage-of-completion (POC) method of accounting from the third quarter of 2008. Under the POC method of accounting for the sale of vacation ownership interests, the Company recognized $36 million of previously deferred revenue during the third quarter of 2009, while third quarter 2008 reported revenues were reduced by $2 million of deferred revenue.
EBITDA for the third quarter of 2009 was $104 million, down 19% from the third quarter of 2008, reflecting the net impact of the planned reduction of VOI sales volume, partially offset by an $18 million impact from the net increase in the recognition of revenue previously deferred under the POC method of accounting.
For the full financial statement including the financial tabels, visit http://www.wyndhamworldwide.com
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