TRAVEL + LEISURE CO. +
INVESTOR PRESENTATION
March/April 2024
CLUB WYNDHAM ELYSIAN BEACH
Presentation of Financial Information
Financial information discussed in this presentation includes non-GAAP measures such as Adjusted EBITDA, Adjusted EBITDA margin, Adjusted diluted EPS, Adjusted free cash flow, Adjusted free cash flow conversion, gross VOI sales and Adjusted net income, which include or exclude certain items, as well as non-GAAP guidance. The Company utilizes non-GAAP measures on a regular basis to assess performance of its reportable segments and allocate resources. These non-GAAP measures differ from reported GAAP results and are intended to illustrate what management believes are relevant period-over-period comparisons and are helpful to investors when considered with GAAP measures as an additional tool for further understanding and assessing the Company's ongoing operating performance by adjusting for items which in our view do not necessarily reflect ongoing performance. Management also internally uses these measures to assess our operating performance, both absolutely and in comparison to other companies, and in evaluating or making selected compensation decisions. Exclusion of items in the Company's non-GAAP presentation should not be considered an inference that these items are unusual, infrequent or non-recurring. See the appendix to this presentation for definitions of these Non-GAAP measures, and full reconciliations of non-GAAP financial measures to the most directly comparable GAAP financial measures where applicable.
The Company may use its website as a means of disclosing information concerning its operations, results and prospects, including information which may constitute material nonpublic information, and for complying with its disclosure obligations under SEC Regulation FD. Disclosure of such information will be included on the Company's website in the Investor Relations section at travelandleisureco.com/investors. Accordingly, investors should monitor that Investor Relations section of the Company website, in addition to accessing its press releases, its submissions and filings with the SEC, and its publicly noticed conference calls and webcasts.
About Travel + Leisure Co.
As the world's leading membership and leisure travel company, Travel + Leisure Co. (NYSE:TNL) transformed the way families vacation with the introduction of the most dynamic points-based vacation ownership program at Club Wyndham, and the first vacation exchange network, RCI. The company delivers more than six million vacations each year at more than 270 timeshare resorts worldwide, through tailored travel and membership products, and via Travel + Leisure GO-the signature subscription travel club inspired by the pages of Travel + Leisure magazine. With hospitality and responsible tourism at the heart of all we do, our 19,000+ dedicated associates bring out the best in people and places around the globe. We put the world on vacation. Learn more at travelandleisureco.com.
Forward-Looking Statements
This presentation includes "forward-looking statements" as that term is defined by the Securities and Exchange Commission ("SEC"). Forward-looking statements are any statements other than statements of historical fact, including statements regarding our expectations, beliefs, hopes, intentions or strategies regarding the future. In some cases, forward-looking statements can be identified by the use of words such as "may," "will," "expects," "should," "believes," "plans," "anticipates," "estimates," "predicts," "potential," "continue," "outlook," or other words of similar meaning. Forward-looking statements are subject to risks and uncertainties that could cause actual results of Travel + Leisure Co. and its subsidiaries ("Travel + Leisure Co." or "we") to differ materially from those discussed in, or implied by, the forward- looking statements. Factors that might cause such a difference include, but are not limited to, risks associated with: the acquisition of the Travel + Leisure brand and the future prospects and plans for Travel + Leisure Co., including our ability to execute our strategies to grow our cornerstone timeshare and exchange businesses and expand into the broader leisure travel industry through travel clubs; our ability to compete in the highly competitive timeshare and leisure travel industries; uncertainties related to acquisitions, dispositions and other strategic transactions; the health of the travel industry and declines or disruptions caused by adverse economic conditions (including inflation, higher interest rates, and recessionary pressures), terrorism or acts of gun violence, political strife, war (including hostilities in Ukraine and the Middle East), pandemics, and severe weather events and other natural disasters; adverse changes in consumer travel and vacation patterns, consumer preferences and demand for our products; increased or unanticipated operating costs and other inherent business risks; our ability to comply with financial and restrictive covenants under our indebtedness; our ability to access capital and insurance markets on reasonable terms, at a reasonable cost or at all; maintaining the integrity of internal or customer data and protecting our systems from cyber-attacks; the timing and amount of future dividends and share repurchases, if any; and those other factors disclosed as risks under "Risk Factors" in documents we have filed with the SEC, including in Part I, Item 1A of our Annual Report on Form 10-K for the fiscal year ended December 31, 2023, filed with the SEC on February 21, 2024. We caution readers that any such statements are based on currently available operational, financial and competitive information, and they should not place undue reliance on these forward-looking statements, which reflect management's opinion only as of the date on which they were made. Except
as required by law, we undertake no obligation to review or update these forward-looking statements to reflect events or circumstances as they occur.
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W E P U T T H E WO R L D O N VACAT I O N
Our mission
The Travel + Leisure Co. Story
Resilient Business. Strong FCF and Capital Returns.
Proven Resilient | Favorable | Timeshare Reality | Expanding | Strong Margins | Robust Capital | |||||
Business Model | Market Dynamics | vs. Perception | Platform | and FCF | Returns | |||||
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P R OV E N | FAVO R A B L E | T I M E S H A R E | |||
R E S I L I E N T | M A R K E T | R E A L I T Y VS . | E X PA N D I N G | ||
B U S I N E S S M O D E L | DY N A M I C S | P E R C E P T I O N | P L AT F O R M | ||
Proven Resilient Business Model
S T R O N G | R O B U S T |
M A R G I N S | CA P I TA L |
A N D F C F | R E T U R N S |
CLUB WYNDHAM GRAND DESERT
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P R OV E N | FAVO R A B L E | T I M E S H A R E | ||
R E S I L I E N T | M A R K E T | R E A L I T Y VS . | ||
B U S I N E S S M O D E L | DY N A M I C S | P E R C E P T I O N | ||
E X PA N D I N G | S T R O N G | R O B U S T |
M A R G I N S | CA P I TA L | |
P L AT F O R M | A N D F C F | R E T U R N S |
Leading Membership & Leisure Travel Company
At a Glance
Key Financials | 2023 |
Net Revenue | $3.8B |
Gross VOI Sales (1) | $2.15B |
Adj. EBITDA(1) | $908M |
Adj. Free Cash Flow (1) | $379M |
Revenue mix (2)
19%
Key Facts | 2023 |
Timeshare Resorts | 245+ |
Timeshare Owners | 800K+ |
Affiliated Exchange Resorts | ~4,100 |
Avg. Exchange Members | 3.5M |
81%
Vacation Ownership | Travel and Membership | |
- Non-GAAPmeasure: see appendix for definition and reconciliation.
- Mix of reportable segment activity.
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P R OV E N | FAVO R A B L E | T I M E S H A R E | ||
R E S I L I E N T | M A R K E T | R E A L I T Y VS . | ||
B U S I N E S S M O D E L | DY N A M I C S | P E R C E P T I O N | ||
S T R O N G | R O B U S T | |
E X PA N D I N G | M A R G I N S | CA P I TA L |
P L AT F O R M | A N D F C F | R E T U R N S |
1Q 2024 Results
TH R E E M O NTH S E N D E D 3/3 1/2 0 2 4
Net Revenue | Gross VOI Sales(1) | Adj. EBITDA(1) | Adj. Diluted Earnings Per Share(1) |
$916M | $490M | $191M | $0.97 |
+4% YOY growth | +8% YOY growth | +4% YOY growth | +9% YOY growth |
H I G H LI G HTS
VPG of $3,035, above the high | Tours up 15% over prior year | New owner tours up 28% |
end of our guidance range | over prior year |
(1) Non-GAAP measure: see appendix for definition and reconciliation.
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P R OV E N | FAVO R A B L E | T I M E S H A R E | ||
R E S I L I E N T | M A R K E T | R E A L I T Y VS . | ||
B U S I N E S S M O D E L | DY N A M I C S | P E R C E P T I O N | ||
S T R O N G | R O B U S T | |
E X PA N D I N G | M A R G I N S | CA P I TA L |
P L AT F O R M | A N D F C F | R E T U R N S |
Resilient Business with Strong Adjusted EBITDA Margins
Vacation Ownership Segment Adjusted EBITDA Margin(1)
VO Adjusted EBITDA Margin %
30% | ||||||||
22% | 24% (2) | 23% | 23% | 24% | 25% | |||
20% | ||||||||
16% | 16% | |||||||
15% | ||||||||
7% | 10% | |||||||
The Great | COVID-19 | 5% | ||||||
Recession | ||||||||
2007 | 2008 | 2009 | 2010-2019 | 2020 | 2021 | 2022 | 2023 | 0% |
2007 | 2008 | 2009 | 2010-2019 | 2020 | 2021 | 2022 | 2023 | Gross |
VOI (1) | ||||||||
1,993 | 1,987 | 1,315 | 1,935 (2) | 967 | 1,491 | 1,982 | 2,149 | |
- Non-GAAPmeasure: see appendix for definition and reconciliation.
- Average from 2010-2019.
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P R OV E N | FAVO R A B L E | T I M E S H A R E | ||
R E S I L I E N T | M A R K E T | R E A L I T Y VS . | ||
B U S I N E S S M O D E L | DY N A M I C S | P E R C E P T I O N | ||
S T R O N G | R O B U S T | |
E X PA N D I N G | M A R G I N S | CA P I TA L |
P L AT F O R M | A N D F C F | R E T U R N S |
Strong Credit Quality
Average FICO Score on New Originations
Average Interest Rate | FICO | ||||||||
800 | 18.0% | ||||||||
736 | 736 | 739 | 17.0% | ||||||
725 | 726 | 735 | |||||||
16.0% | |||||||||
700 | 683 | 691 | 14.6% | 14.7% | 14.7% | 14.9% | 15.0% | ||
13.8% | |||||||||
14.0% | |||||||||
12.7% | 12.9% | 13.0% | |||||||
12.5% | |||||||||
600 | |||||||||
12.0% | |||||||||
11.0% | |||||||||
500 | 2007 | 2008 | 2009 | 2010-2019 | 2020 | 2021 | 2022 | 2023 | 10.0% |
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P R OV E N | FAVO R A B L E | T I M E S H A R E | |||
R E S I L I E N T | M A R K E T | R E A L I T Y VS . | E X PA N D I N G | ||
B U S I N E S S M O D E L | DY N A M I C S | P E R C E P T I O N | P L AT F O R M | ||
Predictable and/or Recurring Revenue
($ in millions)
$3,750
S T R O N G | R O B U S T |
M A R G I N S | CA P I TA L |
A N D F C F | R E T U R N S |
Travel and Membership subscription revenue
Booking revenue from exchange members
$3.1B loan portfolio; Fixed interest rates
Management fees from 245+ resorts; 98% contract retention
Subscription Revenue | 5% |
$183 | |
Exchange Transactions | 9% |
$343 | |
Consumer Financing | 11% |
$427 | |
Property Management | 22% |
$814 | |
>75% of Revenue
is Predictable
and/or Recurring
25+ years of data shows owners | VOI Upgrade Sales | 29% |
consistently upgrade | $1,076 | |
Primarily New Vacation Owner Sales and | Other | 24% |
Travel Club transactions | $907 | |
2023
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Disclaimer
Travel + Leisure Co. published this content on 08 May 2024 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 08 May 2024 22:34:37 UTC.
