Document and Entity Information
Document and Entity Information - USD ($) | 12 Months Ended | ||
Dec. 31, 2017 | Feb. 23, 2018 | Jun. 30, 2017 | |
Document And Entity Information [Abstract] | |||
Document Type | 10-K | ||
Amendment Flag | false | ||
Document Period End Date | Dec. 31, 2017 | ||
Document Fiscal Year Focus | 2,017 | ||
Document Fiscal Period Focus | FY | ||
Trading Symbol | VAC | ||
Entity Registrant Name | Marriott Vacations Worldwide Corporation | ||
Entity Central Index Key | 1,524,358 | ||
Current Fiscal Year End Date | --12-31 | ||
Entity Well-known Seasoned Issuer | Yes | ||
Entity Current Reporting Status | Yes | ||
Entity Voluntary Filers | No | ||
Entity Filer Category | Large Accelerated Filer | ||
Entity Common Stock, Shares Outstanding | 26,536,583 | ||
Entity Public Float | $ 2,811,247,091 |
CONSOLIDATED STATEMENTS OF INCO
CONSOLIDATED STATEMENTS OF INCOME - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 30, 2016 | Jan. 01, 2016 | |
REVENUES | |||
Sale of vacation ownership products | $ 727,940 | $ 637,503 | $ 675,329 |
Resort management and other services | 306,196 | 300,821 | 292,561 |
Financing | 134,906 | 126,126 | 124,033 |
Rental | 322,902 | 312,071 | 312,997 |
Cost reimbursements | 460,001 | 431,965 | 405,875 |
TOTAL REVENUES | 1,951,945 | 1,808,486 | 1,810,795 |
EXPENSES | |||
Cost of vacation ownership products | 177,813 | 155,093 | 204,299 |
Marketing and sales | 408,715 | 353,295 | 330,599 |
Resort management and other services | 172,137 | 174,311 | 180,072 |
Financing | 17,951 | 18,631 | 21,208 |
Rental | 281,352 | 260,752 | 259,729 |
General and administrative | 110,225 | 104,833 | 106,104 |
Litigation settlement | 4,231 | (303) | (232) |
Organizational and separation related | 0 | 0 | 1,174 |
Consumer financing interest | 25,217 | 23,685 | 24,658 |
Royalty fee | 63,021 | 60,953 | 58,982 |
Impairment | 0 | 0 | 324 |
Cost reimbursements | 460,001 | 431,965 | 405,875 |
TOTAL EXPENSES | 1,720,663 | 1,583,215 | 1,592,792 |
Gains and other income, net | 5,772 | 11,201 | 9,557 |
Interest expense | (9,572) | (8,912) | (12,810) |
Other | (1,599) | (4,632) | (8,253) |
INCOME BEFORE INCOME TAXES | 225,883 | 222,928 | 206,497 |
Benefit (provision) for income taxes | 895 | (85,580) | (83,698) |
NET INCOME | $ 226,778 | $ 137,348 | $ 122,799 |
EARNINGS PER SHARE | |||
Basic earnings per share (in usd per share) | $ 8.38 | $ 4.93 | $ 3.90 |
Diluted earnings per share (in usd per share) | 8.18 | 4.83 | 3.82 |
Cash dividends declared per share of common stock (in usd per share) | $ 1.45 | $ 1.25 | $ 1.05 |
CONSOLIDATED STATEMENTS OF COMP
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 30, 2016 | Jan. 01, 2016 | |
Statement of Comprehensive Income [Abstract] | |||
Net income | $ 226,778 | $ 137,348 | $ 122,799 |
Other comprehensive income (loss), net of tax: | |||
Foreign currency translation adjustments | 11,195 | (5,589) | (5,673) |
Derivative instrument adjustment, net of tax | 90 | (332) | 0 |
Total other comprehensive income (loss), net of tax | 11,285 | (5,921) | (5,673) |
COMPREHENSIVE INCOME | $ 238,063 | $ 131,427 | $ 117,126 |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 30, 2016 |
ASSETS | ||
Cash and cash equivalents | $ 409,059 | $ 147,102 |
Restricted cash (including $32,321 and $27,525 from VIEs, respectively) | 81,553 | 66,000 |
Accounts and contracts receivable, net (including $5,639 and $4,865 from VIEs, respectively) | 154,174 | 161,733 |
Vacation ownership notes receivable, net (including $815,331 and $717,543 from VIEs, respectively) | 1,119,631 | 972,311 |
Inventory | 716,533 | 712,536 |
Property and equipment | 252,727 | 202,802 |
Other (including $13,708 and $0 from VIEs, respectively) | 172,516 | 128,935 |
TOTAL ASSETS | 2,906,193 | 2,391,419 |
LIABILITIES AND EQUITY | ||
Accounts payable | 145,405 | 124,439 |
Advance deposits | 63,062 | 55,542 |
Accrued liabilities (including $701 and $584 from VIEs, respectively) | 168,591 | 147,469 |
Deferred revenue | 98,286 | 95,495 |
Payroll and benefits liability | 111,885 | 95,516 |
Deferred compensation liability | 74,851 | 62,874 |
Debt, net (including $845,131 and $738,362 from VIEs, respectively) | 1,095,213 | 737,224 |
Other | 13,155 | 15,873 |
Deferred taxes | 90,725 | 149,168 |
TOTAL LIABILITIES | 1,861,173 | 1,483,600 |
Contingencies and Commitments (Note 9) | ||
Preferred stock — $.01 par value; 2,000,000 shares authorized; none issued or outstanding | 0 | 0 |
Common stock — $.01 par value; 100,000,000 shares authorized; 36,861,843 and 36,633,868 shares issued, respectively | 369 | 366 |
Treasury stock — at cost; 10,400,547 and 9,643,562 shares, respectively | (694,233) | (606,631) |
Additional paid-in capital | 1,188,538 | 1,162,283 |
Accumulated other comprehensive income | 16,745 | 5,460 |
Retained earnings | 533,601 | 346,341 |
TOTAL EQUITY | 1,045,020 | 907,819 |
TOTAL LIABILITIES AND EQUITY | $ 2,906,193 | $ 2,391,419 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 30, 2016 |
Restricted cash | $ 81,553 | $ 66,000 |
Accounts and contracts receivable net | 154,174 | 161,733 |
Vacation ownership notes receivable, net | 1,119,631 | 972,311 |
Other assets | 172,516 | 128,935 |
Accrued liabilities | 168,591 | 147,469 |
Debt net | $ 1,095,213 | $ 737,224 |
Preferred stock, par value (in usd per share) | $ 0.01 | $ 0.01 |
Preferred stock, shares authorized (in shares) | 2,000,000 | 2,000,000 |
Preferred stock, issued (in shares) | 0 | 0 |
Preferred stock, outstanding (in shares) | 0 | 0 |
Common stock, par value (in usd per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized (in shares) | 100,000,000 | 100,000,000 |
Common stock, shares issued (in shares) | 36,861,843 | 36,633,868 |
Treasury stock, shares (in shares) | 10,400,547 | 9,643,562 |
Variable Interest Entity | ||
Restricted cash | $ 32,321 | $ 27,525 |
Accounts and contracts receivable net | 5,639 | 4,865 |
Vacation ownership notes receivable, net | 815,331 | 717,543 |
Other assets | 13,708 | 0 |
Accrued liabilities | 701 | 584 |
Debt net | $ 845,131 | $ 738,362 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017USD ($) | Dec. 30, 2016USD ($) | Jan. 01, 2016USD ($) | |
OPERATING ACTIVITIES | |||
Net income | $ 226,778 | $ 137,348 | $ 122,799 |
Adjustments to reconcile net income to net cash provided by operating activities: | |||
Depreciation | 21,494 | 21,044 | 22,217 |
Amortization of Debt Issuance Costs and Discounts | 9,908 | 6,509 | 5,586 |
Provision for loan losses | 50,075 | 47,292 | 33,083 |
Share-based compensation | 16,286 | 13,949 | 14,142 |
Loss (gain) on disposal of property and equipment, net | 1,605 | (11,201) | (9,557) |
Deferred income taxes | (66,134) | 38,834 | 28,162 |
Net change in assets and liabilities: | |||
Accounts and contracts receivable | 5,695 | (30,055) | (24,189) |
Notes receivable originations | (467,311) | (356,859) | (311,195) |
Notes receivable collections | 270,516 | 253,622 | 270,170 |
Inventory | 42,661 | 4,301 | 72,158 |
Purchase of vacation ownership units for future transfer to inventory | (33,594) | 0 | 0 |
Purchase of operating properties for future conversion to inventory | 0 | 0 | (61,554) |
Other assets | (21,318) | 11,092 | (10,648) |
Accounts payable, advance deposits and accrued liabilities | 50,754 | (18,698) | 32,841 |
Liability for Marriott Rewards customer loyalty program | 0 | (37) | (89,251) |
Deferred revenue | 1,837 | 17,664 | (5,289) |
Payroll and benefit liabilities | 16,053 | (6,933) | 11,380 |
Deferred compensation liability | 11,976 | 11,843 | 9,354 |
Other liabilities | (211) | 1,863 | 2,974 |
Other, net | 5,102 | (199) | 5,231 |
Net cash provided by operating activities | 142,172 | 141,379 | 118,414 |
INVESTING ACTIVITIES | |||
Capital expenditures for property and equipment (excluding inventory) | (26,297) | (34,770) | (35,735) |
Purchase of company owned life insurance | (12,100) | 0 | 0 |
Purchase of operating property to be sold | 0 | 0 | (47,658) |
Dispositions, net | 33 | 68,953 | 20,644 |
Net cash (used in) provided by investing activities | (38,364) | 34,183 | (62,749) |
FINANCING ACTIVITIES | |||
Borrowings from securitization transactions | 400,260 | 376,622 | 255,000 |
Repayment of debt related to securitization transactions | (293,491) | (322,864) | (278,427) |
Borrowings from Revolving Corporate Credit Facility | 87,500 | 85,000 | 0 |
Repayment of Revolving Corporate Credit Facility | (87,500) | (85,000) | 0 |
Proceeds from issuance of Convertible Notes | 230,000 | 0 | 0 |
Purchase of Convertible Note Hedges | (33,235) | 0 | 0 |
Proceeds from issuance of Warrants | 20,332 | 0 | 0 |
Proceeds from vacation ownership inventory arrangement | 0 | 0 | 5,375 |
Debt issuance costs | (15,347) | (4,065) | (5,335) |
Repurchase of common stock | (88,305) | (177,830) | (201,380) |
Redemption of mandatorily redeemable preferred stock of consolidated subsidiary | 0 | (40,000) | 0 |
Payment of dividends | (38,028) | (34,195) | (23,793) |
Payment of withholding taxes on vesting of restricted stock units | (10,947) | (4,021) | (10,894) |
Other, net | (502) | 194 | 327 |
Net cash provided by (used in) financing activities | 170,737 | (206,159) | (259,127) |
Effect of changes in exchange rates on cash, cash equivalents and restricted cash | 2,965 | (4,813) | (4,448) |
Increase (decrease) in cash, cash equivalents and restricted cash | 277,510 | (35,410) | (207,910) |
Cash, cash equivalents and restricted cash, beginning of year | 213,102 | 248,512 | 456,422 |
Cash, cash equivalents and restricted cash, end of year | 490,612 | 213,102 | 248,512 |
SUPPLEMENTAL DISCLOSURE OF NON-CASH INVESTING AND FINANCING ACTIVITIES | |||
Dividends payable | 10,589 | 9,480 | 8,898 |
Non-cash issuance of debt in connection with acquisition of vacation ownership units | 63,558 | 0 | 0 |
Non-cash transfer from Inventory to Property and equipment | 0 | 9,741 | 30,985 |
Non-cash transfer of debt | 0 | 2,985 | 0 |
Property acquired via capital lease | $ 0 | $ 7,221 | $ 0 |
CONSOLIDATED STATEMENTS OF SHAR
CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITY - USD ($) $ in Thousands | Total | Common Stock | Treasury Stock | Additional Paid-In Capital | Accumulated Other Comprehensive Income | Retained Earnings |
Balance (in shares) at Jan. 02, 2015 | 32,093,000 | |||||
Balance at Jan. 02, 2015 | $ 1,079,703 | $ 361 | $ (229,229) | $ 1,137,785 | $ 17,054 | $ 153,732 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net income | 122,799 | 122,799 | ||||
Foreign currency translation adjustments | (5,673) | (5,673) | ||||
Derivative instrument adjustment | 0 | |||||
Amounts related to share-based compensation (in shares) | 304,000 | |||||
Amounts related to share-based compensation | 12,958 | $ 3 | 12,955 | |||
Adjustment to reclassification of Marriott International investment to Additional paid-in capital | (9) | (9) | ||||
Repurchase of common stock (in shares) | (2,857,000) | |||||
Repurchase of common stock | (201,380) | (201,380) | ||||
Dividends | (32,691) | (32,691) | ||||
Employee stock plan issuance (in shares) | 10,000 | |||||
Employee stock plan issuance | 560 | 619 | (59) | |||
Ending Balance (in shares) at Jan. 01, 2016 | 29,550,000 | |||||
Ending Balance at Jan. 01, 2016 | 976,267 | $ 364 | (429,990) | 1,150,731 | 11,381 | 243,781 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net income | 137,348 | 137,348 | ||||
Foreign currency translation adjustments | (5,589) | (5,589) | ||||
Derivative instrument adjustment | (332) | (332) | ||||
Amounts related to share-based compensation (in shares) | 240,000 | |||||
Amounts related to share-based compensation | 11,426 | $ 2 | 11,424 | |||
Repurchase of common stock (in shares) | (2,819,000) | |||||
Repurchase of common stock | (177,830) | (177,830) | ||||
Dividends | (34,788) | (34,788) | ||||
Employee stock plan issuance (in shares) | 19,000 | |||||
Employee stock plan issuance | $ 1,317 | 1,189 | 128 | |||
Ending Balance (in shares) at Dec. 30, 2016 | 26,990,306 | 26,990,000 | ||||
Ending Balance at Dec. 30, 2016 | $ 907,819 | $ 366 | (606,631) | 1,162,283 | 5,460 | 346,341 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Impact of adoption of ASU 2016-09 | 371 | (371) | ||||
OPENING BALANCE 2017 | 907,819 | $ 366 | $ (606,631) | 1,162,654 | 5,460 | 345,970 |
Net income | 226,778 | 226,778 | ||||
Foreign currency translation adjustments | 11,195 | 11,195 | ||||
Derivative instrument adjustment | 90 | 90 | ||||
Amounts related to share-based compensation (in shares) | 228,000 | |||||
Amounts related to share-based compensation | 5,708 | $ 3 | 5,705 | |||
Repurchase of common stock (in shares) | (768,000) | (767,876) | ||||
Repurchase of common stock | (88,305) | $ (88,305) | ||||
Dividends | (39,147) | (39,147) | ||||
Equity component of convertible notes, net of issuance costs | 32,573 | 32,573 | ||||
Purchase of convertible note hedges | (33,235) | (33,235) | ||||
Issuance of warrants | 20,332 | 20,332 | ||||
Employee stock plan issuance (in shares) | 11,000 | |||||
Employee stock plan issuance | $ 1,212 | 703 | 509 | |||
Ending Balance (in shares) at Dec. 31, 2017 | 26,461,296 | 26,461,000 | ||||
Ending Balance at Dec. 31, 2017 | $ 1,045,020 | $ 369 | $ (694,233) | $ 1,188,538 | $ 16,745 | $ 533,601 |
SUMMARY OF SIGNIFICANT ACCOUNTI
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 12 Months Ended |
Dec. 31, 2017 | |
Accounting Policies [Abstract] | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Our Business Marriott Vacations Worldwide Corporation (“we,” “us,” “Marriott Vacations Worldwide,” or the “Company,” which includes our consolidated subsidiaries except where the context of the reference is to a single corporate entity) is the exclusive worldwide developer, marketer, seller and manager of vacation ownership and related products under the Marriott Vacation Club and Grand Residences by Marriott brands. In 2016, we introduced Marriott Vacation Club Pulse, an extension to the Marriott Vacation Club brand. We are also the exclusive worldwide developer, marketer and seller of vacation ownership and related products under The Ritz-Carlton Destination Club brand, and we have the non-exclusive right to develop, market and sell whole ownership residential products under The Ritz-Carlton Residences brand. The Ritz-Carlton Hotel Company, L.L.C. (“The Ritz-Carlton Hotel Company”), a subsidiary of Marriott International, Inc. (“Marriott International”), provides on-site management for Ritz-Carlton branded properties. Our business is grouped into three reportable segments: North America, Asia Pacific and Europe. As of December 31, 2017 , our portfolio consisted of over 65 properties in the United States and nine other countries and territories. We generate most of our revenues from four primary sources: selling vacation ownership products; managing our resorts; financing consumer purchases of vacation ownership products; and renting vacation ownership inventory. Our Spin-Off from Marriott International On November 21, 2011, the spin-off of Marriott Vacations Worldwide from Marriott International (the “Spin-Off”) was completed pursuant to a Separation and Distribution Agreement (the “Separation and Distribution Agreement”) between Marriott Vacations Worldwide and Marriott International. In connection with the Spin-Off, we entered into several agreements that govern the ongoing relationship between Marriott Vacations Worldwide and Marriott International. Principles of Consolidation and Basis of Presentation The consolidated financial statements presented herein and discussed below include 100 percent of the assets, liabilities, revenues, expenses and cash flows of Marriott Vacations Worldwide, all entities in which Marriott Vacations Worldwide has a controlling voting interest (“subsidiaries”), and those variable interest entities for which Marriott Vacations Worldwide is the primary beneficiary in accordance with consolidation accounting guidance. Intercompany accounts and transactions between consolidated companies have been eliminated in consolidation. The consolidated financial statements reflect our financial position, results of operations and cash flows as prepared in conformity with United States Generally Accepted Accounting Principles (“GAAP”). In order to make this report easier to read, we refer throughout to (i) our Consolidated Financial Statements as our “Financial Statements,” (ii) our Consolidated Statements of Income as our “Income Statements,” (iii) our Consolidated Balance Sheets as our “Balance Sheets,” and (iv) our Consolidated Statements of Cash Flows as our “Cash Flows.” In addition, references throughout to numbered “Footnotes” refer to the numbered Notes in these Notes to Consolidated Financial Statements, unless otherwise noted. We use certain other terms that are defined within these Financial Statements. Unless otherwise specified, each reference to a particular year in these Financial Statements means the fiscal year ended on the date shown in the following table, rather than the corresponding calendar year. Beginning with our 2017 fiscal year, we changed our financial reporting cycle to a calendar year-end and end-of-month quarterly reporting cycle. Accordingly our 2017 fiscal year began on December 31, 2016 (the day after the end of the 2016 fiscal year) and ended on December 31, 2017. Our future fiscal years will begin on January 1 and end on December 31. As a result of the change in our financial reporting cycle, our 2017 fiscal year had two more days of activity than our 2016 and 2015 fiscal years. We have not restated, and do not plan to restate, historical results. Fiscal Year Fiscal Year-End Date Number of Days 2017 December 31, 2017 366 2016 December 30, 2016 364 2015 January 1, 2016 364 The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect amounts reported in the financial statements and accompanying notes. Such estimates include, but are not limited to, revenue recognition, cost of vacation ownership products, inventory valuation, property and equipment valuation, loan loss reserves, income taxes and loss contingencies. Accordingly, actual amounts may differ from these estimated amounts. We have reclassified certain prior year amounts to conform to our 2017 presentation. Revenue Recognition Sale of Vacation Ownership Products We market and sell real estate and in substance real estate in our three reportable segments. Real estate and in substance real estate include deeded vacation ownership products, deeded beneficial interests, rights to use real estate, and other interests in trusts that solely hold real estate and deeded whole ownership units in residential buildings. Within the North America segment, we also market and sell residential units at certain properties on a limited basis. Sales of vacation ownership products may be made for cash or we may provide financing. We are not providing financing on sales of whole ownership products. Except for revenue from the sale of residential stand-alone structures, which we recognize upon transfer of title to a third party, we recognize revenue under the percentage-of-completion method when all of the following exist or are true: the customer has executed a binding sales contract, the statutory rescission period has expired (after which time the purchasers are not entitled to a refund except for non-delivery by us), we have deemed the receivable collectible and the remainder of our obligations are substantially completed. In addition, before we recognize any revenues, the purchaser must have met the initial investment criteria and, as applicable, the continuing investment criteria. A purchaser has met the initial investment criteria when we receive a minimum down payment. In accordance with the authoritative guidance for accounting for real estate time-sharing transactions, we must also take into consideration the fair value of certain incentives provided to the purchaser when assessing the adequacy of the purchaser’s initial investment. In those cases where we provide financing to the purchaser, the purchaser must be obligated to remit monthly payments under financing contracts that represent the purchaser’s continuing investment. Resort Management and Other Services Revenues Our resort management and other services revenues consist primarily of ancillary revenues and management fees. Ancillary revenues consist of goods and services that are sold or provided by us at restaurants, golf courses and other retail and service outlets located at our resorts. We recognize ancillary revenue when goods have been provided and/or services have been rendered. Ancillary revenues recorded as a component of Resort management and other services revenues were $118.2 million in 2017 , $124.2 million in 2016 and $125.2 million in 2015 , as reflected on our Income Statements. We provide day-to-day-management services, including housekeeping services, operation of reservation systems, maintenance and certain accounting and administrative services for property owners’ associations. We receive compensation for these management services; this is typically based on either a percentage of the budgeted costs to operate the resorts or a fixed fee arrangement. We recognize revenues when earned in accordance with the terms of the contract. Management fee revenues recorded as a component of Resort management and other services revenues were $87.8 million in 2017 , $83.3 million in 2016 and $77.6 million in 2015 , as reflected on our Income Statements. Resort management and other services revenues also include additional fees for services we provide to our property owners’ associations, as well as annual fees, club dues, settlement fees from the sale of vacation ownership products, and certain transaction-based fees from owners and other third parties, including external exchange service providers with which we are associated. We recognize fee revenues when services have been rendered. Fee revenues included in Resort management and other services revenues were $79.0 million in 2017 , $75.7 million in 2016 and $72.4 million in 2015 , as reflected on our Income Statements. Financing Revenues We offer consumer financing as an option to qualifying customers purchasing vacation ownership products, which is collateralized by the underlying vacation ownership products. We recognize interest income on an accrual basis. The contractual terms of the financing agreements require that the contractual level of annual principal payments be sufficient to amortize the loan over a customary period for the vacation ownership product being financed, which is generally ten years. Generally, payments commence under the financing contracts 30 to 60 days after closing. We record an estimate of uncollectible amounts at the time of the sale with a charge to the provision for loan losses, which we classify as a reduction of Sale of vacation ownership products on our Income Statements. Revisions to estimates of uncollectible amounts also impact the provision for loan losses and can increase or decrease revenue. We earn interest income from the financing arrangements on the principal balance outstanding over the life of the arrangement and record that interest income in Financing revenues on our Income Statements. Financing revenues include certain annual and transaction-based fees we charge to owners and other third parties for services. We recognize fee revenues when services have been rendered. Fee revenues included in Financing revenues were $6.9 million in 2017 , $6.0 million in 2016 and $6.0 million in 2015 , as reflected on our Income Statements. Rental Revenues We record rental revenues when occupancy has occurred or, in the case of unused prepaid rentals, upon forfeiture. We also recognize rental revenue from the utilization of plus points under the Marriott Vacation Club Destinations ™ (“MVCD”) program when those points are redeemed for rental stays at one of our resorts or in the Explorer Collection, or upon expiration of the points. Cost Reimbursements Cost reimbursements include direct and indirect costs that property owners’ associations reimburse to us. In accordance with the accounting guidance for “gross versus net” presentation, we record these revenues on a gross basis. We recognize cost reimbursements when we incur the related reimbursable costs. These costs primarily consist of payroll and payroll related expenses for management of the property owners’ associations and other services we provide where we are the employer. Cost reimbursements consist of actual expenses with no added margin. Inventory Our inventory consists primarily of completed vacation ownership products, vacation ownership products under construction and land held for future vacation ownership product development. We carry our inventory at the lower of (1) cost, including costs of improvements and amenities incurred subsequent to acquisition, capitalized interest and real estate taxes plus other costs incurred during construction, or (2) estimated fair value, less costs to sell, which can result in impairment charges and/or recoveries of previous impairments. We account for vacation ownership inventory and cost of vacation ownership products in accordance with the authoritative guidance for accounting for real estate time-sharing transactions, which defines a specific application of the relative sales value method for reducing vacation ownership inventory and recording cost of sales as described in our policy for revenue recognition for vacation ownership products. Also, pursuant to the guidance for accounting for real estate time-sharing transactions, we do not reduce inventory for cost of vacation ownership products related to anticipated credit losses (accordingly, no adjustment is made when inventory is reacquired upon default of the related receivable). These standards provide for changes in estimates within the relative sales value calculations to be accounted for as real estate inventory true-ups, which we refer to as product cost true-up activity, and are recorded in Cost of vacation ownership product expenses on the Income Statements to retrospectively adjust the margin previously recorded subject to those estimates. For 2017 , 2016 and 2015 , product cost true-up activity relating to vacation ownership products increased carrying values of inventory by $0.3 million , $14.8 million and $7.3 million , respectively. For residential real estate projects, we allocate costs to individual residences in the projects based on the relative estimated sales value of each residence in accordance with Accounting Standards Codification (“ASC”) 970, “ Real Estate—General ,” which defines the accounting for costs of real estate projects. Under this method, we reduce the allocated cost of a unit from inventory and recognize that cost as cost of sales when we recognize the related sale. Changes in estimates within the relative sales value calculations for residential products (similar to condominiums) are accounted for as prospective adjustments to cost of vacation ownership products. Capitalization of Costs We capitalize costs clearly associated with the acquisition of real estate when a transaction is accounted for as an asset acquisition under ASC 805, “ Business Combinations ” (“ASC 805”) . Alternatively, when acquired real estate constitutes a business under ASC 805, transaction costs are expensed as incurred. We capitalize interest and certain salaries and related costs incurred in connection with the following: (1) development and construction of sales centers; (2) internally developed software; and (3) development and construction projects for our real estate inventory. We capitalize costs clearly associated with the development and construction of a real estate project when it is probable that we will acquire a property. We capitalize salary and related costs only to the extent they directly relate to the project. We capitalize interest expense, taxes and insurance costs when activities that are necessary to get the property ready for its intended use are underway. We cease capitalization of costs during prolonged gaps in development when substantially all activities are suspended or when projects are considered substantially complete. Capitalized salaries and related costs totaled $5.7 million , $6.1 million and $7.1 million for 2017 , 2016 and 2015 , respectively. Defined Contribution Plan We administer and maintain a defined contribution plan for the benefit of all employees meeting certain eligibility requirements who elect to participate in the plan. Contributions are determined based on a specified percentage of salary deferrals by participating employees. We recognized compensation expense (net of cost reimbursements from property owners’ associations) for our participating employees totaling $9.7 million in 2017 , $8.0 million in 2016 and $7.1 million in 2015 . Deferred Compensation Plan Prior to the Spin-Off, certain members of our senior management had the opportunity to participate in the Marriott International, Inc. Executive Deferred Compensation Plan (the “Marriott International EDC”), which Marriott International maintains and administers. Under the Marriott International EDC, participating employees were able to defer payment and income taxation of a portion of their salary and bonus. Participants also had the opportunity for long-term capital appreciation by crediting their accounts with notional earnings (at a fixed annual rate of return of 4.0 percent for 2017 and 4.5 percent for 2016 ). Although additional discretionary contributions to the participants’ accounts under the Marriott International EDC may be made, no additional discretionary contributions were made for our employees in 2017 , 2016 and 2015 . Subsequent to the Spin-Off, we remain liable to reimburse Marriott International for distributions for participants that were employees of Marriott Vacations Worldwide at the time of the Spin-Off including earnings thereon. Since 2014, certain members of our senior management have had the opportunity to participate in the Marriott Vacations Worldwide Deferred Compensation Plan (the “Deferred Compensation Plan”), which we maintain and administer. Under the Deferred Compensation Plan, participating employees may defer payment and income taxation of a portion of their salary and bonus. It also gives participants the opportunity for long-term capital appreciation by crediting their accounts with notional earnings. Since the beginning of our 2017 fiscal year, participants in the Deferred Compensation Plan have been able to select a rate of return based on various market-based investment alternatives for a portion of their contributions, as well as any future Company contributions, to the Deferred Compensation Plan, and may also select such a rate for a portion of their existing account balances. To support our ability to meet a portion of our obligations under the Deferred Compensation Plan, we acquired company owned insurance policies (the “COLI policies”) on the lives of certain participants in the Deferred Compensation Plan, the proceeds of which are intended to be aligned with the investment alternatives elected by plan participants and are payable to a rabbi trust with the Company as grantor. For 2017, at least 25 percent of a participant’s contributions to the Deferred Compensation Plan was required to be subject to a fixed rate of return, which was 3.5 percent for 2017 and 5.6 percent for 2016 ; the rate was reduced in connection with the introduction of the market-based investment alternatives. For 2018, participants may select a rate of return based on market-based investment alternatives for up to 100 percent of their contributions and existing balances. We consolidate the liabilities of the Deferred Compensation Plan and the related assets, which consist of the COLI policies held in the rabbi trust. The rabbi trust is considered a variable interest entity (“VIE”). We are considered the primary beneficiary of the rabbi trust because we direct the activities of the trust and are the beneficiary of the trust. At December 31, 2017 , the value of the assets held in the rabbi trust was $13.7 million , which is included in the Other line within assets on our Balance Sheets. Property and Equipment Property and equipment includes our sales centers, golf courses, information technology and other assets used in the normal course of business, as well as undeveloped and partially developed land parcels that are not part of an approved development plan and do not meet the criteria to be classified as held for sale. In addition, fully developed vacation ownership interests are classified as property and equipment until they are registered for sale. We record property and equipment at cost, including interest and real estate taxes incurred during active development. We capitalize the cost of improvements that extend the useful life of property and equipment when incurred. These capitalized costs may include structural costs, equipment, fixtures, floor and decorative items and signage. We expense all repair and maintenance costs as incurred. We compute depreciation using the straight-line method over the estimated useful lives of the assets ( three to forty years), and we amortize leasehold improvements over the shorter of the asset life or lease term. Cash and Cash Equivalents We consider all highly liquid investments with an initial purchase maturity of three months or less at the date of purchase to be cash equivalents. Restricted Cash Restricted cash primarily consists of cash held in a reserve account related to vacation ownership notes receivable securitizations, cash collected for maintenance fees to be remitted to property owners’ associations, and deposits received, primarily associated with vacation ownership products and residential sales that are held in escrow until the associated contract has closed or the period in which it can be rescinded has passed, depending on legal requirements. Loan Loss Reserves We record an estimate of expected uncollectibility on all notes receivable from vacation ownership purchasers as a reduction of revenues from the sale of vacation ownership products at the time we recognize profit on a vacation ownership product sale. We fully reserve for all defaulted vacation ownership notes receivable in addition to recording a reserve on the estimated uncollectible portion of the remaining vacation ownership notes receivable. For those vacation ownership notes receivable that are not in default, we assess collectibility based on pools of vacation ownership notes receivable because we hold large numbers of homogeneous vacation ownership notes receivable. We use the same criteria to estimate uncollectibility for non-securitized vacation ownership notes receivable and securitized vacation ownership notes receivable because they perform similarly. We estimate uncollectibility for each pool based on historical activity for similar vacation ownership notes receivable. Although we consider loans to owners to be past due if we do not receive payment within 30 days of the due date, we suspend accrual of interest only on those loans that are over 90 days past due. We consider loans over 150 days past due to be in default. We apply payments we receive for vacation ownership notes receivable on non-accrual status first to interest, then to principal and any remainder to fees. We resume accruing interest when vacation ownership notes receivable are less than 90 days past due. We do not accept payments for vacation ownership notes receivable during the foreclosure process unless the amount is sufficient to pay all past due principal, interest, fees and penalties owed and fully reinstate the note. We write off uncollectible vacation ownership notes receivable against the reserve once we receive title to the vacation ownership products through the foreclosure or deed-in-lieu process or, in Europe or Asia Pacific, when revocation is complete. For both non-securitized and securitized vacation ownership notes receivable, we estimated average remaining default rates of 7.16 percent and 7.09 percent as of December 31, 2017 and December 30, 2016 , respectively. A 0.5 percent age point increase in the estimated default rate would have resulted in an increase in our allowance for loan losses of $5.9 million and $5.0 million as of December 31, 2017 and December 30, 2016 , respectively. For additional information on our vacation ownership notes receivable, including information on the related reserves, see Footnote No. 3, “Vacation Ownership Notes Receivable.” Variable Interest Entities In accordance with the applicable accounting guidance for the consolidation of variable interest entities, we analyze our variable interests, including loans, guarantees and equity investments, to determine if an entity in which we have a variable interest is a variable interest entity. Our analysis includes both quantitative and qualitative reviews. We base our quantitative analysis on the forecasted cash flows of the entity, and our qualitative analysis on our review of the design of the entity, its organizational structure including decision-making ability, and relevant financial agreements. We also use our qualitative analyses to determine if we must consolidate a variable interest entity because we are its primary beneficiary. Costs Incurred to Sell Vacation Ownership Products We charge the majority of marketing and sales costs we incur to sell vacation ownership products to expense when incurred. Deferred marketing and selling expenses, which are direct marketing and selling costs related either to an unclosed contract or a contract for which 100 percent of revenue has not yet been recognized, were $6.0 million at year-end 2017 and $6.2 million at year-end 2016 and are included on the accompanying Balance Sheets in the Other caption within Assets. Valuation of Property and Equipment Property and equipment includes our sales centers, golf courses, operating properties, information technology and other assets used in the normal course of business, as well as undeveloped and partially developed land parcels that are not part of an approved development plan and do not meet the criteria to be classified as held for sale. We test long-lived asset groups for recoverability when changes in circumstances indicate the carrying value may not be recoverable, for example, when there are material adverse changes in projected revenues or expenses, significant underperformance relative to historical or projected operating results, or significant negative industry or economic trends. We evaluate recoverability of an asset group by comparing its carrying value to the future net undiscounted cash flows that we expect will be generated by the asset group. If the comparison indicates that the carrying value of an asset group is not recoverable, we recognize an impairment loss for the excess of carrying value over the estimated fair value. When we recognize an impairment loss for assets to be held and used, we depreciate the adjusted carrying amount of those assets over their remaining useful life. Fair Value Measurements We have few financial instruments that we must measure at fair value on a recurring basis. See Footnote No. 4, “Financial Instruments,” for further information. We also apply the provisions of fair value measurement to various non-recurring measurements for our financial and non-financial assets and liabilities. The applicable accounting standards define fair value as the price that would be received upon selling an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date (an exit price). We measure fair value of our assets and liabilities using inputs from the following three levels of the fair value hierarchy: Level 1 inputs are unadjusted quoted prices in active markets for identical assets or liabilities that we have the ability to access at the measurement date. Level 2 inputs include quoted prices for similar assets and liabilities in active markets, quoted prices for identical or similar assets or liabilities in markets that are not active, inputs other than quoted prices that are observable for the asset or liability (i.e., interest rates, yield curves, etc.), and inputs that are derived principally from or corroborated by observable market data by correlation or other means (market corroborated inputs). Level 3 includes unobservable inputs that reflect our assumptions about what factors market participants would use in pricing the asset or liability. We develop these inputs based on the best information available, including our own data. Derivative Instruments From time to time, we may use derivative instruments to reduce market risk due to changes in interest rates and currency exchange rates, including interest rate derivatives that we may be required to enter into as a condition of our $250.0 million non-recourse warehouse credit facility (the “Warehouse Credit Facility”). As of December 31, 2017 , we were not party to any material derivative instruments or hedges. The designation of a derivative instrument as a hedge and its ability to meet the hedge accounting criteria determines how the change in fair value of the derivative instrument is recorded on our Financial Statements. A derivative qualifies for hedge accounting if, at inception, we expect the derivative to be highly effective in offsetting the underlying hedged cash flows or fair value and we fulfill the hedge documentation standards at the time we enter into the derivative contract. We designate a hedge as a cash flow hedge, fair value hedge, or a net investment in non-U.S. operations hedge based on the exposure we are hedging. The asset or liability value of the derivative will change in tandem with its fair value. For the effective portion of qualifying hedges, we record changes in fair value in other comprehensive income (“OCI”). We release the derivative’s gain or loss from OCI to match the timing of the underlying hedged items’ effect on earnings. As a matter of policy, we only enter into hedging transactions that we believe will be highly effective at offsetting the underlying risk and do not use derivatives for trading or speculative purposes. Non-U.S. Operations The U.S. dollar is the functional currency of our consolidated entities operating in the United States. The functional currency for our consolidated entities operating outside of the United States is generally the currency of the economic environment in which the entity primarily generates and expends cash. For consolidated entities whose functional currency is not the U.S. dollar, we translate their financial statements into U.S. dollars. We translate assets and liabilities at the exchange rate in effect as of the financial statement date and translate Income Statement accounts using the weighted average exchange rate for the period. We include translation adjustments from currency exchange and the effect of exchange rate changes on intercompany transactions of a long-term investment nature as a separate component of equity. We report gains and losses from currency exchange rate changes related to intercompany receivables and payables that are not of a long-term investment nature, as well as gains and losses from non-U.S. currency transactions, currently in operating costs and expenses. Loss Contingencies We are subject to various legal proceedings and claims in the normal course of business, the outcomes of which are subject to significant uncertainty. We record an accrual for loss contingencies when we determine that it is probable that a liability has been incurred and the amount of the loss can be reasonably estimated. In making such determinations we evaluate, among other things, the degree of probability of an unfavorable outcome and, when it is probable that a liability has been incurred, our ability to make a reasonable estimate of the loss. We review these accruals each reporting period and make revisions based on changes in facts and circumstances. Share-Based Compensation Costs We established the Marriott Vacations Worldwide Corporation Stock and Cash Incentive Plan (the “Stock Plan”) in order to compensate our employees and directors by granting them equity awards such as restricted stock units (“RSUs”), stock appreciation rights (“SARs”) and stock options. We follow the provisions of ASC 718, “ Compensation—Stock Compensation, ” which requires that a company measure the expense of employee services received in exchange for an award of equity instruments based on the grant-date fair value of the award. Generally, share-based awards granted to our employees, other than RSUs with performance vesting conditions, vest ratably over a four -year period. For share-based awards with service-only vesting conditions, we record compensation expense on a straight-line basis over the requisite service period. For RSUs with performance vesting conditions, the number of RSUs earned, if any, is determined following the end of a three -year performance period based upon the cumulative achievement over that period of specific quantitative operating financial measures and we recognize compensation expense once it is probable that the corresponding performance condition will be achieved. SARs awarded under the Stock Plan are granted at exercise prices or strike prices equal to the market price of our common stock on the date of grant (this price is referred to as the “base value”). SARs generally expire ten years after the date of grant and both vest and become exercisable in cumulative installments of one quarter of the grant at the end of each of the first four years following the date of grant. Upon exercise of SARs, our employees and non-employee directors receive a number of shares of our common stock equal to the number of SARs being exercised, multiplied by the quotient of (a) the market price o |
INCOME TAXES
INCOME TAXES | 12 Months Ended |
Dec. 31, 2017 | |
Income Tax Disclosure [Abstract] | |
INCOME TAXES | INCOME TAXES Tax Reform On December 22, 2017, the Tax Cuts and Jobs Act (the “Tax Act”) was signed into law effective January 1, 2018. The Tax Act significantly revised the U.S. tax code by, in part, but not limited to: reducing the U.S. corporate maximum tax rate from 35 percent to 21 percent, imposing a mandatory one-time transition tax on certain un-repatriated earnings of foreign subsidiaries, modifying executive compensation deduction limitations and repealing the deduction for domestic production activities. Under ASC Topic 740, “ Income Taxes ,” we must generally recognize the effects of tax law changes in the period in which the new legislation is enacted. During December 2017, the Securities and Exchange Commission staff issued Staff Accounting Bulletin (“SAB”) No. 118 (“SAB 118”) to address the application of GAAP in situations when a registrant does not have all the necessary information available, prepared, or analyzed (including computations) in reasonable detail to complete the accounting for certain income tax effects of the Tax Cuts and Jobs Act. In accordance with SAB 118, our deferred tax assets and liabilities were remeasured using the new corporate tax rate of 21 percent, rather than the previous corporate tax rate of 35 percent, resulting in a $65.2 million decrease in our income tax expense for the year ended December 31, 2017 and a corresponding $65.2 million decrease in our net deferred tax liability as of December 31, 2017. These amounts are to be considered provisional and are not currently able to be finalized given the complexity of the underlying calculations. Additional work is necessary to perform a more detailed analysis. Any subsequent adjustment to these amounts will be recorded to tax expense in the quarter of 2018 when the analysis is complete. The one-time transition tax on certain un-repatriated earnings of foreign subsidiaries is based on total post-1986 earnings and profits that we previously deferred from U.S. income taxes. While we have performed a preliminary analysis of the transition tax and determined that due to deficits in foreign earnings and profits, we do not have a one-time transition tax liability to record in 2017, we have not completed our calculations. As the one-time transition tax is based in part on the amount of those earnings held in cash and other specified assets, we may determine that we have a one-time transition tax liability when we finalize the calculation of post-1986 foreign earnings and profits previously deferred from U.S. federal taxation and finalize the amounts held in cash or other specified assets. No additional income taxes have been provided for any remaining undistributed foreign earnings not subject to the transition tax, or any additional outside basis difference inherent in these entities, as these amounts continue to be indefinitely reinvested in foreign operations. The modification of the executive compensation deduction limitations and the repeal of the deduction for domestic production activities did not have a significant impact on our benefit from income taxes for the year ended December 31, 2017. Income Tax Benefit / Provision The components of our earnings before income taxes for the last three years consisted of: ($ in thousands) 2017 2016 2015 United States $ 217,348 $ 220,169 $ 197,519 Non-U.S. jurisdictions 8,535 2,759 8,978 $ 225,883 $ 222,928 $ 206,497 In 2017, our tax benefit included an excess tax benefit of $6.1 million related to the vesting or exercise of employee share-based awards. Our tax provision did not reflect excess tax benefits of $1.2 million in 2016 and $9.4 million in 2015, as these periods were before our adoption of ASU 2016-09. In our statements of cash flows, we presented excess tax benefits as financing cash flows before our adoption of ASU 2016-09. Our benefit (provision) for income taxes for the last three years consisted of: ($ in thousands) 2017 2016 2015 Current – U.S. Federal $ (48,735 ) $ (35,715 ) $ (44,728 ) – U.S. State (7,370 ) (4,926 ) (4,027 ) – Non-U.S. (7,043 ) (4,902 ) (6,953 ) (63,148 ) (45,543 ) (55,708 ) Deferred – U.S. Federal 49,072 (38,332 ) (25,350 ) – U.S. State (279 ) (3,432 ) (4,554 ) – Non-U.S. 15,250 1,727 1,914 64,043 (40,037 ) (27,990 ) $ 895 $ (85,580 ) $ (83,698 ) The deferred tax assets and related valuation allowances in these Financial Statements have been determined on a separate return basis. The assessment of the valuation allowances requires considerable judgment on the part of management with respect to benefits that could be realized from future taxable income, as well as other positive and negative factors. Valuation allowances are recorded against the deferred tax assets of certain foreign operations for which historical losses, restructuring and impairment charges have been incurred. The change in the valuation allowances established were ($3.9) million in 2017 , $1.5 million in 2016 and ($3.7) million in 2015 . We have made no provision for U.S. income taxes or additional non-U.S. taxes on the cumulative unremitted earnings of non-U.S. subsidiaries ( $184.0 million at December 31, 2017 ) because we consider these earnings to be permanently invested. We do not consider previously taxed income to be permanently reinvested if such earnings can be distributed to a U.S. entity without incurring additional U.S. tax. These earnings could become subject to additional taxes if remitted as dividends, loaned to a U.S. affiliate or if we sold our interests in the affiliates. We cannot estimate the amount of additional taxes that might be payable on the unremitted earnings. We conduct business in countries that grant “holidays” from income taxes for ten to thirty year periods. These holidays expire through 2034 . Our income tax returns are subject to examination by relevant tax authorities. Certain of our returns are being audited in various jurisdictions for years 2013 and 2014. Although we do not anticipate that a significant impact to our unrecognized tax benefit balance will occur during the next fiscal year, the amount of our liability for unrecognized tax benefits could change as a result of audits in these jurisdictions. Deferred Income Taxes Deferred income tax balances reflect the effects of temporary differences between the carrying amounts of assets and liabilities and their tax bases, as well as from net operating loss and tax credit carry-forwards. We state those balances at the enacted tax rates we expect will be in effect when we actually pay or recover taxes. Deferred income tax assets represent amounts available to reduce income taxes we will pay on taxable income in future years. We evaluate our ability to realize these future tax deductions and credits by assessing whether we expect to have sufficient future taxable income from all sources, including reversal of taxable temporary differences, forecasted operating earnings and available tax planning strategies, to utilize these future deductions and credits. We establish a valuation allowance when we no longer consider it more likely than not that a deferred tax asset will be realized. The following table presents our deferred tax assets and liabilities, and the tax effect of each type of temporary difference and carry-forward that gave rise to a significant portion of our deferred tax assets and liabilities at December 31, 2017 and December 30, 2016 : ($ in thousands) At Year-End 2017 At Year-End 2016 Deferred Tax Assets Inventory $ 24,814 $ 24,821 Reserves 29,854 38,677 Long lived intangible assets 15,746 31,464 Net operating loss carry-forwards 38,831 49,205 Tax credits 39,593 21,345 Other, net 53,397 52,263 Deferred tax assets 202,235 217,775 Less valuation allowance (43,987 ) (47,839 ) Net deferred tax assets 158,248 169,936 Deferred Tax Liabilities Property and equipment (16,360 ) (15,560 ) Deferred sales of vacation ownership interests (220,130 ) (296,600 ) Deferred tax liabilities (236,490 ) (312,160 ) Total net deferred tax liabilities $ (78,242 ) $ (142,224 ) At December 31, 2017 , we had approximately $37.2 million of foreign net operating losses (excluding valuation allowances) some of which begin expiring in 2018. However, a significant portion of these tax net operating losses have an indefinite carry forward period. We have no federal net operating losses and net operating losses of $1.3 million for state tax purposes which begin expiring in 2032. Reconciliation of U.S. Federal Statutory Income Tax Rate to Actual Income Tax Rate Due to the adoption of ASU 2016-09 in the 2017 first quarter, all excess tax benefits and deficiencies are now recognized as a component of income tax expense in our Income Statements; previously, excess tax benefits were recognized in additional paid-in capital. This may result in increased volatility in our effective tax rate. The following table reconciles the U.S. statutory income tax rate to our effective income tax rate: 2017 2016 2015 U.S. statutory income tax rate 35.00% 35.00% 35.00% U.S. state income taxes, net of U.S. federal tax benefit 2.42 2.47 2.62 Permanent differences (1) (0.65) 1.03 1.65 Impact related to the Tax Cuts and Jobs Act (28.86) — — Excess tax benefits related to share-based compensation (2.70) — — Foreign tax rate changes (2.11) 0.05 0.01 Non-U.S. income (loss) (2) (2.81) 0.09 (0.63) Other items (3) (0.76) (0.95) 1.22 Change in valuation allowance (4) 0.07 0.70 0.66 Effective rate (0.40%) 38.39% 40.53% _________________________ (1) Attributed to the redemption of the mandatorily redeemable preferred stock of a consolidated subsidiary. (2) Attributed to the difference between U.S. and foreign income tax rates and other foreign adjustments. (3) Attributed to changes in unrecognized tax benefits and U.S. federal tax incentives. (4) Primarily attributed to release of a foreign valuation allowance in 2017. Primarily attributed to the establishment of valuation allowances in foreign jurisdictions for losses that cannot be benefited in the U.S. income tax provision in 2016 and 2015, as discussed above. Cash Taxes Paid Cash taxes paid in 2017 , 2016 and 2015 were $49.3 million , $47.8 million and $50.2 million |
VACATION OWNERSHIP NOTES RECEIV
VACATION OWNERSHIP NOTES RECEIVABLE | 12 Months Ended |
Dec. 31, 2017 | |
Receivables [Abstract] | |
VACATION OWNERSHIP NOTES RECEIVABLE | VACATION OWNERSHIP NOTES RECEIVABLE The following table shows the composition of our vacation ownership notes receivable balances, net of reserves: ($ in thousands) At Year-End 2017 At Year-End 2016 Vacation ownership notes receivable — securitized $ 815,331 $ 717,543 Vacation ownership notes receivable — non-securitized Eligible for securitization (1) 142,269 98,508 Not eligible for securitization (1) 162,031 156,260 Subtotal 304,300 254,768 Total vacation ownership notes receivable $ 1,119,631 $ 972,311 _________________________ (1) Refer to Footnote No. 4, “Financial Instruments,” for discussion of eligibility of our vacation ownership notes receivable for securitization. The following tables show future principal payments, net of reserves, as well as interest rates for our non-securitized and securitized vacation ownership notes receivable at December 31, 2017 : ($ in thousands) Non-Securitized Vacation Ownership Notes Receivable Securitized Vacation Ownership Notes Receivable Total 2018 $ 48,846 $ 94,079 $ 142,925 2019 35,253 90,719 125,972 2020 30,567 92,089 122,656 2021 26,127 93,351 119,478 2022 23,953 92,191 116,144 Thereafter 139,554 352,902 492,456 Balance at year-end 2017 $ 304,300 $ 815,331 $ 1,119,631 Weighted average stated interest rate at year-end 2017 11.5% 12.6% 12.3% Range of stated interest rates at year-end 2017 0.0% to 18.0% 4.9% to 18.0% 0.0% to 18.0% We reflect interest income associated with vacation ownership notes receivable in our Income Statements in the Financing revenues caption. The following table summarizes interest income associated with vacation ownership notes receivable: ($ in thousands) 2017 2016 2015 Interest income associated with vacation ownership notes receivable – securitized $ 101,193 $ 96,606 $ 89,693 Interest income associated with vacation ownership notes receivable – non-securitized 26,790 23,507 28,327 Total interest income associated with vacation ownership notes receivable $ 127,983 $ 120,113 $ 118,020 The following table summarizes the activity related to our vacation ownership notes receivable reserve for 2017, 2016 and 2015: ($ in thousands) Non-Securitized Securitized Total Balance at year-end 2014 $ 64,752 $ 53,666 $ 118,418 Provision for loan losses 23,832 9,209 33,041 Securitizations (16,491 ) 16,491 — Clean-up calls (1) 7,115 (7,115 ) — Write-offs (48,220 ) — (48,220 ) Defaulted vacation ownership notes receivable repurchase activity (2) 24,596 (24,596 ) — Balance at year-end 2015 55,584 47,655 103,239 Provision for loan losses 28,652 18,505 47,157 Securitizations (28,322 ) 28,322 — Clean-up of Warehouse Credit Facility (3) 10,496 (10,496 ) — Write-offs (40,033 ) — (40,033 ) Defaulted vacation ownership notes receivable repurchase activity (2) 30,251 (30,251 ) — Balance at year-end 2016 56,628 53,735 110,363 Provision for loan losses 41,531 9,021 50,552 Securitizations (29,071 ) 29,071 — Clean-up of Warehouse Credit Facility (3) 3,995 (3,995 ) — Write-offs (45,257 ) — (45,257 ) Defaulted vacation ownership notes receivable repurchase activity (2) 28,324 (28,324 ) — Balance at year-end 2017 $ 56,150 $ 59,508 $ 115,658 _________________________ (1) Refers to our voluntary repurchase of previously securitized non-defaulted vacation ownership notes receivable to retire outstanding vacation ownership notes receivable securitizations. (2) Decrease in securitized vacation ownership notes receivable reserve and increase in non-securitized vacation ownership notes receivable reserve was attributable to the transfer of the reserve when we voluntarily repurchased defaulted securitized vacation ownership notes receivable. (3) Refers to our voluntary repurchase of previously securitized non-defaulted vacation ownership notes receivable from our Warehouse Credit Facility. The following table shows our recorded investment in non-accrual vacation ownership notes receivable, which are vacation ownership notes receivable that are 90 days or more past due. As noted in Footnote No. 1, “Summary of Significant Accounting Policies,” we recognize interest income on a cash basis for these vacation ownership notes receivable. ($ in thousands) Non-Securitized Vacation Ownership Notes Receivable Securitized Vacation Ownership Notes Receivable Total Investment in vacation ownership notes receivable on non-accrual status at year-end 2017 $ 38,786 $ 7,428 $ 46,214 Investment in vacation ownership notes receivable on non-accrual status at year-end 2016 $ 43,792 $ 6,687 $ 50,479 Average investment in vacation ownership notes receivable on non-accrual status during 2017 $ 41,289 $ 7,058 $ 48,347 The following table shows the aging of the recorded investment in principal, before reserves, in vacation ownership notes receivable as of December 31, 2017 : ($ in thousands) Non-Securitized Vacation Ownership Notes Receivable Securitized Vacation Ownership Notes Receivable Total 31 – 90 days past due $ 7,109 $ 18,553 $ 25,662 91 – 150 days past due 4,341 7,428 11,769 Greater than 150 days past due 34,445 — 34,445 Total past due 45,895 25,981 71,876 Current 314,555 848,858 1,163,413 Total vacation ownership notes receivable $ 360,450 $ 874,839 $ 1,235,289 The following table shows the aging of the recorded investment in principal, before reserves, in vacation ownership notes receivable as of December 30, 2016 : ($ in thousands) Non-Securitized Securitized Total 31 – 90 days past due $ 7,780 $ 16,468 $ 24,248 91 – 150 days past due 3,981 6,687 10,668 Greater than 150 days past due 39,811 — 39,811 Total past due 51,572 23,155 74,727 Current 259,824 748,123 1,007,947 Total vacation ownership notes receivable $ 311,396 $ 771,278 $ 1,082,674 |
FINANCIAL INSTRUMENTS
FINANCIAL INSTRUMENTS | 12 Months Ended |
Dec. 31, 2017 | |
Investments, All Other Investments [Abstract] | |
FINANCIAL INSTRUMENTS | FINANCIAL INSTRUMENTS The following table shows the carrying values and the estimated fair values of financial assets and liabilities that qualify as financial instruments, determined in accordance with the authoritative guidance for disclosures regarding the fair value of financial instruments. Considerable judgment is required in interpreting market data to develop estimates of fair value. The use of different market assumptions and/or estimation methodologies could have a material effect on the estimated fair value amounts. The table excludes Cash and cash equivalents, Restricted cash, Accounts and contracts receivable, Accounts payable, Advance deposits and Accrued liabilities, all of which had fair values approximating their carrying amounts due to the short maturities and liquidity of these instruments. At Year-End 2017 At Year-End 2016 ($ in thousands) Carrying Fair (1) Carrying Fair (1) Vacation ownership notes receivable — securitized $ 815,331 $ 956,292 $ 717,543 $ 834,009 Vacation ownership notes receivable — non-securitized 304,300 324,661 254,768 269,161 Other assets 13,708 13,708 — — Total financial assets $ 1,133,339 $ 1,294,661 $ 972,311 $ 1,103,170 Non-recourse debt associated with vacation ownership notes receivable securitizations, net $ (834,889 ) $ (836,028 ) $ (729,188 ) $ (725,963 ) Convertible notes, net (192,518 ) (259,884 ) — — Non-interest bearing note payable, net (60,560 ) (60,560 ) — — Total financial liabilities $ (1,087,967 ) $ (1,156,472 ) $ (729,188 ) $ (725,963 ) _________________________ (1) Fair value of financial instruments with the exception of other assets and convertible notes, has been determined using Level 3 inputs. Fair value of other assets and convertible notes that are financial instruments has been determined using Level 2 inputs. See the “Fair Value Measurements” caption of Footnote No. 1, “Summary of Significant Accounting Policies” for additional information. Vacation Ownership Notes Receivable We estimate the fair value of our securitized vacation ownership notes receivable using a discounted cash flow model. We believe this is comparable to the model that an independent third party would use in the current market. Our model uses default rates, prepayment rates, coupon rates and loan terms for our securitized vacation ownership notes receivable portfolio as key drivers of risk and relative value that, when applied in combination with pricing parameters, determine the fair value of the underlying vacation ownership notes receivable. Due to factors that impact the general marketability of our non-securitized vacation ownership notes receivable, as well as current market conditions, we bifurcate our vacation ownership notes receivable at each balance sheet date into those eligible and not eligible for securitization using criteria applicable to current securitization transactions in the asset-backed securities (“ABS”) market. Generally, vacation ownership notes receivable are considered not eligible for securitization if any of the following attributes are present: (1) payments are greater than 30 days past due; (2) the first payment has not been received; or (3) the collateral is located in Europe or Asia. In some cases eligibility may also be determined based on the credit score of the borrower, the remaining term of the loans and other similar factors that may reflect investor demand in a securitization transaction or the cost to effectively securitize the vacation ownership notes receivable. The following table shows the bifurcation of our non-securitized vacation ownership notes receivable into those eligible and not eligible for securitization based upon the aforementioned eligibility criteria: At Year-End 2017 At Year-End 2016 ($ in thousands) Carrying Amount Fair Carrying Amount Fair Vacation ownership notes receivable Eligible for securitization $ 142,269 $ 162,630 $ 98,508 $ 112,901 Not eligible for securitization 162,031 162,031 156,260 156,260 Total non-securitized $ 304,300 $ 324,661 $ 254,768 $ 269,161 We estimate the fair value of the portion of our non-securitized vacation ownership notes receivable that we believe will ultimately be securitized in the same manner as securitized vacation ownership notes receivable. We value the remaining non-securitized vacation ownership notes receivable at their carrying value, rather than using our pricing model. We believe that the carrying value of these particular vacation ownership notes receivable approximates fair value because the stated interest rates of these loans are consistent with current market rates and the reserve for these vacation ownership notes receivable appropriately accounts for risks in default rates, prepayment rates, discount rates and loan terms. Other Assets We estimate the fair value of our other assets that are financial instruments using Level 2 inputs. These assets consist of COLI policies held in a rabbi trust. The carrying value of the COLI policies is equal to their cash surrender value. Non-Recourse Debt Associated with Securitized Vacation Ownership Notes Receivable, Net We generate cash flow estimates by modeling all bond tranches for our active vacation ownership notes receivable securitization transactions, with consideration for the collateral specific to each tranche. The key drivers in our analysis include default rates, prepayment rates, bond interest rates and other structural factors, which we use to estimate the projected cash flows. In order to estimate market credit spreads by rating, we obtain indicative credit spreads from investment banks that actively issue and facilitate the market for vacation ownership securities and determine an average credit spread by rating level of the different tranches. We then apply those estimated market spreads to swap rates in order to estimate an underlying discount rate for calculating the fair value of the active bonds payable. Convertible Notes We estimate the fair value of our Convertible Notes using quoted market prices as of the last trading day for the year; however these notes have only a limited trading history and volume and as such this fair value estimate is not necessarily indicative of the value at which they could be retired or transferred. We concluded that this fair value measurement should be categorized within Level 2. The difference between the carrying value and the fair value is primarily attributed to the underlying conversion feature, and the spread between the conversion price and the market value of the shares underlying the Convertible Notes. Non-Interest Bearing Note Payable |
ACQUISITIONS AND DISPOSITIONS
ACQUISITIONS AND DISPOSITIONS | 12 Months Ended |
Dec. 31, 2017 | |
Business Combinations [Abstract] | |
ACQUISITIONS AND DISPOSITIONS | ACQUISITIONS AND DISPOSITIONS 2017 Acquisitions Bali, Indonesia During the 2017 third quarter, we acquired 51 completed vacation ownership units, as well as a sales gallery and related resort amenities, located in Bali, Indonesia for $23.8 million . The transaction was accounted for as an asset acquisition with the purchase price allocated to Inventory ( $21.7 million ) and Property and equipment ( $2.1 million ). Marco Island, Florida During the 2017 second quarter, we acquired 36 completed vacation ownership units located at our resort in Marco Island, Florida for $33.6 million . The transaction was accounted for as an asset acquisition with all of the purchase price allocated to Property and equipment. To ensure consistency with the expected related future cash flow presentation, the cash purchase price was included as an operating activity in the Purchase of vacation ownership units for future transfer to inventory line on our Cash Flow for the year ended December 31, 2017. See Footnote No. 9, “Contingencies and Commitments,” for information on our remaining commitment related to this property. Big Island of Hawaii During the 2017 second quarter, we acquired 112 completed vacation ownership units located on the Big Island of Hawaii. The transaction was accounted for as an asset acquisition with all of the purchase price allocated to Inventory. As consideration for the acquisition, we paid $27.3 million in cash, settled a $0.5 million note receivable from the seller on a non-cash basis, and issued a non-interest bearing note payable for $63.6 million . See Footnote No. 10, “Debt,” for information on the non-interest bearing note payable. 2017 Dispositions We made no significant dispositions in 2017. 2016 Acquisitions Miami Beach, Florida During the 2016 first quarter, we completed the acquisition of an operating property located in the South Beach area of Miami Beach, Florida, for $23.5 million . The acquisition was treated as a business combination, accounted for using the acquisition method of accounting and included within operating activities on our Cash Flow for the year ended December 30, 2016. As consideration for the acquisition, we paid $23.5 million in cash; the value of the acquired property was allocated to Inventory. We rebranded this property as Marriott Vacation Club Pulse, South Beach and converted it, in its entirety, into vacation ownership inventory. 2016 Dispositions San Francisco, California During the 2016 second quarter, we disposed of 19 residential units, located at The Ritz-Carlton Club and Residences, San Francisco (the “RCC San Francisco”), for gross cash proceeds of $19.5 million . We accounted for the sale under the full accrual method in accordance with the authoritative guidance on accounting for sales of real estate and recorded a gain of $10.5 million in the Gains and other income line on our Income Statement for the year ended December 30, 2016. 2016 Disposition / 2015 Acquisition Surfers Paradise, Australia During the 2015 third quarter, we completed the acquisition of an operating property located in Surfers Paradise, Australia, for AUD $84.5 million ( $62.3 million ). The acquisition was treated as a business combination and accounted for using the acquisition method of accounting. As such, all transaction costs were expensed as incurred and were included in the “Other” line of our Income Statement for the year ended January 1, 2016. As consideration for the acquisition, we paid AUD $82.6 million ( $61.0 million ) in cash and assumed net liabilities of AUD $1.9 million ( $1.3 million ), which was allocated based on the fair value at the date of acquisition as follows: AUD $28.9 million ( $21.3 million ) to land, AUD $49.5 million ( $36.5 million ) to buildings and leasehold improvements and AUD $6.1 million ( $4.5 million ) to furniture and equipment. Fair value was determined using an independent appraisal, which was primarily based on a discounted cash flow model, a Level 3 fair value input. At the time of the acquisition we determined that we would convert a portion of this operating property into vacation ownership interests for future use in our Asia Pacific segment; the related portion of the purchase price was classified as an operating activity on our Cash Flow for the year ended January 1, 2016. Additionally, we intended to sell the remaining downsized portion of the operating property to a third party; the related portion of the purchase price was classified as an investing activity on our Cash Flow for the year ended January 1, 2016. During the 2016 second quarter, we disposed of the portion of this operating property that we did not intend to convert into vacation ownership inventory for gross cash proceeds of AUD $70.5 million ( $50.9 million ). We accounted for the sale under the full accrual method in accordance with the authoritative guidance on accounting for sales of real estate. As part of the disposition, we guaranteed the net operating income of this portion of the operating property through 2021 up to a specified maximum of AUD $2.9 million ( $2.2 million ), which was recorded as a deferred gain in the Other line within liabilities on our balance sheet. We recognized a loss, inclusive of the deferred gain, of AUD $1.2 million ( $0.9 million ) in connection with the sale, which was recorded in the Gains and other income line on the Income Statement for the year ended December 30, 2016. During 2016, we completed the conversion of the portion of this operating property that we intended to convert into vacation ownership inventory at the time of the acquisition, a portion of which was contributed to our points-based programs in our Asia Pacific segment. 2015 Acquisitions Washington, D.C. During the 2015 third quarter, we completed the acquisition of 71 units at The Mayflower Hotel, Autograph Collection, an operating hotel located in Washington, D.C., for $32.0 million . The asset acquisition was treated as a purchase of inventory and we have included these vacation ownership units, in their current form, in our MVCD program. San Diego, California During the 2015 first quarter, we completed the acquisition of an operating property located in San Diego, California, for $55.0 million . The acquisition was treated as a business combination and accounted for using the acquisition method of accounting. As consideration for the acquisition, we paid $55.0 million in cash, which was allocated based on the fair value at the date of acquisition as follows: $54.3 million to property and equipment and $0.7 million to other assets. Fair value was determined using an independent appraisal, which was primarily based on a discounted cash flow model, a Level 3 fair value input. We rebranded this property as Marriott Vacation Club Pulse, San Diego and converted it, in its entirety, into vacation ownership inventory. In order to ensure consistency with the expected related future cash flow presentation, $46.6 million of the cash purchase price allocated to property and equipment was included as an operating activity in the Purchase of operating property for future conversion to inventory line on our Cash Flow for the year ended January 1, 2016. The remaining $7.7 million was included as an investing activity in the Capital expenditures for property and equipment line on our Cash Flow for the year ended January 1, 2016, as it was allocated to assets to be used prior to conversion of the property into vacation ownership inventory, as well as ancillary and sales center assets to be retained after the conversion. 2015 Dispositions Kauai, Hawaii During the 2014 second quarter, we entered into a purchase and sale agreement to dispose of undeveloped and partially developed land, an operating golf course and related assets, in Kauai, Hawaii (the “Kauai Property”) for gross cash proceeds of $60.0 million , and completed the sale of a portion of the Kauai Property for gross cash proceeds of $40.0 million . During the 2015 second quarter, we completed the sale of the remaining portion of the Kauai Property for gross cash proceeds of $20.0 million . We accounted for the sale under the full accrual method in accordance with the authoritative guidance on accounting for sales of real estate and recorded a gain of $8.7 million , which is included in the Gains and other income line on our Income Statement for the year ended January 1, 2016. Marco Island, Florida During the 2015 first quarter, we sold real property located in Marco Island, Florida, consisting of $3.1 million of vacation ownership inventory, to a third-party developer. We received consideration consisting of $5.4 million of cash and a note receivable of $0.5 million . We did not recognize any gain or loss on this transaction. In accordance with our agreement with the third-party developer, we are obligated to repurchase the completed property from the developer contingent upon the property meeting our brand standards, provided that the third-party developer has not sold the property to another party. In accordance with the authoritative guidance on accounting for sales of real estate, our conditional obligation to repurchase the property constitutes continuing involvement and thus we were unable to account |
EARNINGS PER SHARE
EARNINGS PER SHARE | 12 Months Ended |
Dec. 31, 2017 | |
Earnings Per Share [Abstract] | |
EARNINGS PER SHARE | EARNINGS PER SHARE Basic earnings per common share is calculated by dividing net income attributable to common shareholders by the weighted average number of shares of common stock outstanding during the reporting period. Treasury stock is excluded from the weighted average number of shares of common stock outstanding. Diluted earnings per common share is calculated to give effect to all potentially dilutive common shares that were outstanding during the reporting period. The dilutive effect of outstanding equity-based compensation awards is reflected in diluted earnings per common share by application of the treasury stock method using average market prices during the period. Our calculation of diluted earnings per share reflects our intent to settle conversions of the Convertible Notes through a combination settlement, which contemplates repayment in cash of the principal amount and repayment in shares of our common stock of any excess of the conversion value over the principal amount (the “conversion premium”). Therefore, we include only the shares that may be issued with respect to any conversion premium in total dilutive weighted average shares outstanding, which we calculate using the treasury stock method. As no conversion premium existed as of December 31, 2017 , there was no dilutive impact from the Convertible Notes for 2017 . The shares issuable on exercise of the Warrants (as defined in Footnote No. 10, “Debt”) sold in connection with the issuance of the Convertible Notes will not impact the total dilutive weighted average shares outstanding unless and until the price of our common stock exceeds the strike price of $176.68 , as described in Footnote No. 10, “Debt.” If and when the price of our common stock exceeds the strike price of the Warrants, we will include the dilutive effect of the additional shares that may be issued upon exercise of the Warrants in total dilutive weighted average shares outstanding, which we calculate using the treasury stock method. The Convertible Note Hedges (as defined in Footnote No. 10, “Debt”) purchased in connection with the issuance of the Convertible Notes are considered to be anti-dilutive and will not impact our calculation of diluted earnings per share. The table below illustrates the reconciliation of the earnings and number of shares used in our calculation of basic and diluted earnings per share. (in thousands, except per share amounts) 2017 (1) 2016 (2) 2015 (3) Computation of Basic Earnings Per Share Net income $ 226,778 $ 137,348 $ 122,799 Shares for basic earnings per share 27,078 27,882 31,487 Basic earnings per share $ 8.38 $ 4.93 $ 3.90 Computation of Diluted Earnings Per Share Net income $ 226,778 $ 137,348 $ 122,799 Shares for basic earnings per share 27,078 27,882 31,487 Effect of dilutive shares outstanding Employee stock options and SARs 438 367 446 Restricted stock units 217 173 235 Shares for diluted earnings per share 27,733 28,422 32,168 Diluted earnings per share $ 8.18 $ 4.83 $ 3.82 _________________________ (1) The computations of diluted earnings per share exclude approximately 238,000 shares of common stock, the maximum number of shares issuable as of December 31, 2017 upon the vesting of certain performance-based awards, because the performance conditions required to be met for the shares subject to such awards to vest were not achieved by the end of the reporting period. (2) The computations of diluted earnings per share exclude approximately 217,000 shares of common stock, the maximum number of shares issuable as of December 30, 2016 upon the vesting of certain performance-based awards, because the performance conditions required to be met for the shares subject to such awards to vest were not achieved by the end of the reporting period. (3) The computations of diluted earnings per share exclude approximately 136,000 shares of common stock, the maximum number of shares issuable as of January 1, 2016 upon the vesting of certain performance-based awards, because the performance conditions required to be met for the shares subject to such awards to vest were not achieved by the end of the reporting period. In accordance with the applicable accounting guidance for calculating earnings per share, for the year ended December 31, 2017 , our calculation of diluted earnings per share included shares underlying stock appreciation rights (“SARs”) that may be settled in shares of common stock, because the exercise prices of such SARs were less than or equal to the average market prices for the applicable period. For the year ended December 30, 2016 , we excluded from our calculation of diluted earnings per share 62,018 shares underlying SARS that may be settled in shares of common stock because the exercise price of $77.42 of such SARs was greater than the average market price for the applicable period. For the year ended January 1, 2016 , we excluded from our calculation of diluted earnings per share 62,018 shares underlying SARs that may be settled in shares of common stock because the exercise price of $77.42 |
INVENTORY
INVENTORY | 12 Months Ended |
Dec. 31, 2017 | |
Inventory Disclosure [Abstract] | |
INVENTORY | INVENTORY The following table shows the composition of our inventory balances: ($ in thousands) At Year-End 2017 At Year End 2016 Finished goods (1) $ 379,194 $ 337,949 Work-in-progress 2,315 39,486 Land and infrastructure (2) 330,002 330,728 Real estate inventory 711,511 708,163 Operating supplies and retail inventory 5,022 4,373 $ 716,533 $ 712,536 _________________________ (1) Represents completed inventory that is either registered for sale as vacation ownership interests, or unregistered and available for sale in its current form. (2) Includes $67.6 million of inventory related to estimated future foreclosures at December 31, 2017 . We value vacation ownership and residential products at the lower of cost or fair market value less costs to sell, in accordance with applicable accounting guidance, and we record operating supplies at the lower of cost (using the first-in, first-out method) or net realizable value. In addition to the above, at December 31, 2017 , we had $48.3 million of completed vacation ownership units which have been classified as a component of Property and equipment until the time at which they are legally registered for sale as vacation ownership products. As discussed in Footnote No. 9, “Contingencies and Commitments,” we also had $480.5 million |
PROPERTY AND EQUIPMENT
PROPERTY AND EQUIPMENT | 12 Months Ended |
Dec. 31, 2017 | |
Property, Plant and Equipment [Abstract] | |
PROPERTY AND EQUIPMENT | PROPERTY AND EQUIPMENT The following table details the composition of our property and equipment balances: ($ in thousands) At Year-End 2017 At Year-End 2016 Land $ 60,174 $ 54,975 Buildings and leasehold improvements 258,919 213,190 Furniture and equipment 54,394 51,053 Information technology 184,635 180,075 Construction in progress 22,877 27,493 580,999 526,786 Accumulated depreciation (328,272 ) (323,984 ) $ 252,727 $ 202,802 Depreciation expense totaled $21.5 million in 2017 , $21.0 million in 2016 and $22.2 million in 2015 |
CONTINGENCIES AND COMMITMENTS
CONTINGENCIES AND COMMITMENTS | 12 Months Ended |
Dec. 31, 2017 | |
Commitments and Contingencies Disclosure [Abstract] | |
CONTINGENCIES AND COMMITMENTS | CONTINGENCIES AND COMMITMENTS Commitments and Letters of Credit As of December 31, 2017 , we had the following commitments outstanding: • We have various contracts for the use of information technology hardware and software that we use in the normal course of business. Our aggregate commitments under these contracts were $24.6 million , of which we expect $15.3 million , $5.5 million , $1.4 million , $0.9 million , $0.8 million and $0.7 million will be paid in 2018, 2019, 2020, 2021, 2022 and thereafter, respectively. • We have a commitment to purchase an operating property located in New York, New York for $170.2 million , of which $7.2 million is attributed to a related capital lease arrangement and recorded in Debt. We expect to acquire the units in the property, in their current form, over time, and we expect to make payments for these units of $108.5 million and $61.7 million in 2019 and 2020, respectively. We currently manage this property, which we have rebranded as Marriott Vacation Club Pulse, New York City. See Footnote No. 13, “Variable Interest Entities,” for additional information on this transaction and our activities relating to the variable interest entity involved in this transaction. • We have a commitment to purchase 88 vacation ownership units located in Bali, Indonesia for use in our Asia Pacific segment, contingent upon completion of construction to agreed-upon standards within specified timeframes. As of December 31, 2017, we expected to complete the acquisition in 2019 and to make payments with respect to these units when specific construction milestones were completed, as follows: $13.7 million in 2018 and $25.4 million in 2019. During the first quarter of 2018, we amended the terms of this commitment and, as a result, we expect to make payments of $5.8 million in 2018, $30.9 million in 2019 and $1.9 million in 2020. • We have a remaining commitment to purchase vacation ownership units located at our resort in Marco Island, Florida for $108.2 million , which we expect will be paid as follows: $23.7 million in 2018 and $84.5 million in 2019. See Footnote No. 5, “Acquisitions and Dispositions,” for additional information on this transaction and Footnote No. 13, “Variable Interest Entities,” for additional information on our activities relating to the variable interest involved in this transaction. • During the first quarter of 2018, we assigned a commitment to purchase an operating property located in San Francisco, California, that we had as of December 31, 2017, to a third-party developer in a capital efficient inventory arrangement. We expect to acquire the operating property in 2020 and to pay the purchase price of $163.5 million as follows: $100.0 million in 2020 and $63.5 million in 2021. We are required to purchase the operating property from the third-party developer unless it has been sold to another party. The operating property is held by a variable interest entity for which we are not the primary beneficiary as we cannot prevent the variable interest entity from selling the operating property at a higher price. Accordingly, we will not consolidate the variable interest entity. Surety bonds issued as of December 31, 2017 totaled $34.6 million , the majority of which were requested by federal, state or local governments in connection with our operations. Additionally, as of December 31, 2017 , we had $4.6 million of letters of credit outstanding under our $250.0 million revolving credit facility (the “Revolving Corporate Credit Facility”). Loss Contingencies In April 2013, Krishna and Sherrie Narayan and other owners of 12 residential units (owners of two of which subsequently agreed to release their claims) at the resort formerly known as The Ritz-Carlton Club & Residences, Kapalua Bay (“Kapalua Bay”) filed an amended complaint in Circuit Court for Maui County, Hawaii against us, certain of our subsidiaries, Marriott International, certain of its subsidiaries, and the joint venture in which we have an equity investment that developed and marketed vacation ownership and residential products at Kapalua Bay (the “Joint Venture”). In the original complaint, the plaintiffs alleged that defendants mismanaged funds of the residential owners association (the “Kapalua Bay Association”), created a conflict of interest by permitting their employees to serve on the Kapalua Bay Association’s board, and failed to disclose documents to which the plaintiffs were allegedly entitled. The amended complaint alleges breach of fiduciary duty, violations of the Hawaii Unfair and Deceptive Trade Practices Act and the Hawaii condominium statute, intentional misrepresentation and concealment, unjust enrichment and civil conspiracy. The relief sought in the amended complaint includes injunctive relief, repayment of all sums paid to us and our subsidiaries and Marriott International and its subsidiaries, compensatory and punitive damages, and treble damages under the Hawaii Unfair and Deceptive Trade Practices Act. We filed a motion in the Circuit Court to compel arbitration of plaintiffs’ claims. That motion was denied, but on appeal the Hawaii Intermediate Court of Appeals reversed. The Hawaii Supreme Court reversed the decision of the Intermediate Court of Appeals and reinstated the action in Circuit Court, which set the case for trial. We filed a petition with the United States Supreme Court seeking review of the Hawaii Supreme Court’s decision. In January 2016, the U.S. Supreme Court issued an order vacating the Hawaii Supreme Court’s decision and remanding the case with instructions to reconsider its ruling in light of a U.S. Supreme Court decision reiterating the obligation of courts to enforce arbitration agreements. In July 2017, the Hawaii Supreme Court issued a decision reaffirming its prior ruling and remanding the case to the Circuit Court for trial. In November 2017, we filed a petition with the U.S. Supreme Court seeking review of the Hawaii Supreme Court’s July 2017 decision, which the U.S. Supreme Court denied in February 2018. We dispute the material allegations in the amended complaint and continue to defend against the action vigorously. Given the inherent uncertainties of litigation, we cannot estimate a range of the potential liability, if any, at this time. In June 2013, Earl C. and Patricia A. Charles, owners of a fractional interest at Kapalua Bay, together with owners of 38 other fractional interests (owners of two of which subsequently agreed to release their claims) at Kapalua Bay, filed an amended complaint in the Circuit Court of the Second Circuit for the State of Hawaii against us, certain of our subsidiaries, Marriott International, certain of its subsidiaries, the Joint Venture, and other entities that have equity investments in the Joint Venture. The plaintiffs allege that the defendants failed to disclose the financial condition of the Joint Venture and the commitment of the defendants to the Joint Venture, and that defendants’ actions constituted fraud and violated the Hawaii Unfair and Deceptive Trade Practices Act, the Hawaii Condominium Property Act and the Hawaii Time Sharing Plans statute. The relief sought includes compensatory and punitive damages, attorneys’ fees, pre-judgment interest, declaratory relief, rescission and treble damages under the Hawaii Unfair and Deceptive Trade Practices Act. The complaint was subsequently further amended to add owners of two additional fractional interests as plaintiffs. The Circuit Court granted our motion to compel arbitration of the claims asserted by the plaintiffs. Plaintiffs appealed that decision to the Hawaii Intermediate Court of Appeals and also initiated arbitration. In July 2015, the Intermediate Court of Appeals reversed the decision of the Circuit Court and directed that the action be reinstated in the Circuit Court, based on the Hawaii Supreme Court’s decision in the Narayan case discussed above. In October 2017, following the August 2017 action of the Hawaii Supreme Court in the Narayan case, the Circuit Court set the Charles case for trial beginning in January 2019. In December 2017, we filed a motion with the Circuit Court to compel arbitration, which the Circuit Court denied in February 2018. We dispute the material allegations in the amended complaint and continue to defend against the action vigorously. Given the inherent uncertainties of litigation, we cannot estimate a range of the potential liability, if any, at this time. In May 2015, we and certain of our subsidiaries were named as defendants in an action filed in the Superior Court of San Francisco County, California, by William and Sharon Petrick and certain other present and former owners of 69 fractional interests at the RCC San Francisco. The plaintiffs allege that the affiliation of the RCC San Francisco with our points-based Marriott Vacation Club Destinations (“MVCD”) program, certain alleged sales practices, and other acts we and the other defendants allegedly took caused an actionable decrease in the value of their fractional interests. The relief sought includes, among other things, compensatory and punitive damages, rescission, and pre- and post-judgment interest. Plaintiffs filed an amended complaint in April 2016. We filed a motion to dismiss, which the Court granted in part and denied in part in September 2017. The Court also granted leave to plaintiffs to file a second amended complaint, which plaintiffs filed in October 2017. In November 2017, we filed a motion to dismiss the second amended complaint. In February 2018, the Court granted our motion to dismiss and dismissed with prejudice plaintiffs’ claims regarding the existence of a fiduciary duty and breach of that duty. The Court also dismissed plaintiffs’ fraud claims but permitted plaintiffs to reassert those claims no later than March 10, 2018. We dispute the plaintiffs’ material allegations and continue to defend against the action vigorously. Given the early stages of the action and the inherent uncertainties of litigation, we cannot estimate a range of the potential liability, if any, at this time. In March 2017, RCHFU, L.L.C. and other owners of 232 fractional interests at The Ritz-Carlton Club, Aspen Highlands (“RCC Aspen Highlands”) served an amended complaint in an action pending in the court against us, certain of our subsidiaries, and other third party defendants. The U.S. District Court for the District of Colorado has ordered that no further amendments will be permitted. The amended complaint alleges that the plaintiffs’ fractional interests were devalued by the affiliation of RCC Aspen Highlands and other Ritz-Carlton Clubs with our points-based MVCD program. The relief sought includes, among other things, unspecified damages, pre- and post-judgment interest, and attorneys’ fees. We filed a motion to dismiss the amended complaint, which remains pending. In February 2018, plaintiffs filed a motion seeking to add a claim for punitive damages to their complaint. We dispute the plaintiffs’ material allegations and continue to defend against the action vigorously. Given the early stages of the action and the inherent uncertainties of litigation, we cannot estimate a range of the potential liability, if any, at this time. In May 2016, we, certain of our subsidiaries, and certain third parties were named as defendants in an action filed in the U.S. District Court for the Middle District of Florida by Anthony and Beth Lennen. The case is filed as a putative class action; the plaintiffs seek to represent a class consisting of themselves and all other purchasers of MVCD points, from inception of the MVCD program in June 2010 to the present, as well as all individuals who own or have owned weeks in any resorts for which weeks have been added to the MVCD program. Plaintiffs challenge the characterization of the beneficial interests in the MVCD trust that are sold to customers as real estate interests under Florida law. They also challenge the structure of the trust and associated operational aspects of the trust product. The relief sought includes, among other things, declaratory relief, an unwinding of the MVCD product, and punitive damages. In September 2016, we filed a motion to dismiss the complaint and a motion to stay the case pending referral of certain questions to Florida state regulators, and the Court granted the motion to dismiss and denied the motion to stay. The Court granted leave to plaintiffs to file an amended complaint, which plaintiffs filed in October 2017. In November 2017, we filed a motion to dismiss the amended complaint, which remains pending. We dispute the plaintiffs’ material allegations and continue to defend against the action vigorously. Given the early stages of the action and the inherent uncertainties of litigation, we cannot estimate a range of the potential liability, if any, at this time. Other In September 2017, over 20 of our properties were impacted by Hurricane Irma and Hurricane Maria and, as a result, as of December 31, 2017, we have accrued $1.3 million for the estimated property damage insurance deductibles and impairment of property and equipment, which was recorded in the Gains and other income, net line on the Income Statement for the year ended December 31, 2017. During 2016, our properties in Hilton Head and Myrtle Beach, South Carolina were temporarily closed as a result of damage from Hurricane Matthew. In the 2017 third quarter, we received $8.7 million in net insurance proceeds related to the settlement of business interruption insurance claims arising from Hurricane Matthew, which were recorded in the Gains and other income line on the Income Statement for the year ended December 31, 2017. Leases We have various land, corporate facilities, real estate and equipment operating leases. The land lease consists of a long-term golf course land lease with a term of 30 years. The corporate facilities leases are for our corporate headquarters and have lease terms of approximately six years. The other operating leases are primarily for office and retail space as well as equipment supporting our operations and have lease terms of between three and ten years. Certain of these leases provide for minimum rental payments and additional rental payments based on our operations of the leased property. We have summarized our future obligations under operating leases at December 31, 2017 below: ($ in thousands) Land Corporate Other Total 2018 $ 1,157 $ 3,628 $ 12,666 $ 17,451 2019 1,157 3,739 9,636 14,532 2020 1,157 3,850 7,710 12,717 2021 1,157 2,646 5,621 9,424 2022 1,157 — 5,455 6,612 Thereafter 6,939 — 28,547 35,486 Total minimum lease payments $ 12,724 $ 13,863 $ 69,635 $ 96,222 The following table details the composition of rent expense associated with operating leases, net of sublease income, for the last three years: ($ in thousands) 2017 2016 2015 Minimum rentals $ 9,390 $ 8,639 $ 9,401 Additional rentals 3,905 3,845 3,876 $ 13,295 $ 12,484 $ 13,277 |
DEBT
DEBT | 12 Months Ended |
Dec. 31, 2017 | |
Debt Disclosure [Abstract] | |
DEBT | DEBT The following table provides detail on our debt balances, net of unamortized debt discount and issuance costs: ($ in thousands) At Year-End 2017 At Year-End 2016 Vacation ownership notes receivable securitizations, gross (1) $ 845,131 $ 738,362 Unamortized debt issuance costs (10,242 ) (9,174 ) 834,889 729,188 Convertible notes, gross (2) 230,000 — Unamortized debt discount and issuance costs (37,482 ) — 192,518 — Non-interest bearing note payable 63,558 — Unamortized debt discount (3) (2,998 ) — 60,560 — Other debt, gross 27 834 Unamortized debt issuance costs (2 ) (19 ) 25 815 Capital leases 7,221 7,221 $ 1,095,213 $ 737,224 _________________________ (1) Interest rates as of December 31, 2017 range from 2.2% to 6.3% with a weighted average interest rate of 2.5% . (2) The effective interest rate as of December 31, 2017 was 4.7% . (3) Debt discount based on imputed interest rate of 6.0% . See Footnote No. 13, “Variable Interest Entities,” for a discussion of the collateral for the non-recourse debt associated with the securitized vacation ownership notes receivable and the Warehouse Credit Facility. The following table shows scheduled future principal payments for our debt as of December 31, 2017 : ($ in thousands) Vacation Ownership Notes Receivable Securitizations (1) Convertible Notes Non-Interest Bearing Note Payable Other Debt Capital Leases Total Debt Principal Payments Year 2018 $ 95,768 $ — $ 32,680 $ — $ — $ 128,448 2019 92,273 — 30,878 — 7,221 130,372 2020 93,553 — — — — 93,553 2021 94,503 — — — — 94,503 2022 93,808 230,000 — — — 323,808 Thereafter 375,226 — — 27 — 375,253 $ 845,131 $ 230,000 $ 63,558 $ 27 $ 7,221 $ 1,145,937 _________________________ (1) The debt associated with our vacation ownership notes receivable securitizations is non-recourse to us. As the contractual terms of the underlying securitized vacation ownership notes receivable determine the maturities of the non-recourse debt associated with them, actual maturities may occur earlier than shown above due to prepayments by the vacation ownership notes receivable obligors. We paid cash for interest, net of amounts capitalized, of $21.6 million in 2017 , $23.2 million in 2016 and $30.2 million in 2015 . Debt Associated with Vacation Ownership Notes Receivable Securitizations During the 2017 third quarter, we completed the securitization of a pool of $360.8 million of vacation ownership notes receivable. In connection with the securitization, investors purchased in a private placement $350.0 million in vacation ownership loan backed notes from the MVW Owner Trust 2017-1 (the “2017-1 Trust”). Three classes of vacation ownership loan backed notes were issued by the 2017-1 Trust: $276.0 million of Class A Notes, $46.9 million of Class B Notes and $27.1 million of Class C Notes. The Class A Notes have an interest rate of 2.42 percent, the Class B Notes have an interest rate of 2.75 percent and the Class C Notes have an interest rate of 2.99 percent, for an overall weighted average interest rate of 2.51 percent. Each of the transactions in which we have securitized vacation ownership notes receivable contains various triggers relating to the performance of the underlying vacation ownership notes receivable. If a pool of securitized vacation ownership notes receivable fails to perform within the pool’s established parameters (default or delinquency thresholds vary by transaction), transaction provisions effectively redirect the monthly excess spread we would otherwise receive from that pool (attributable to the interests we retained) to accelerate the principal payments to investors (taking into account the subordination of the different tranches to the extent there are multiple tranches) until the performance trigger is cured. During 2017, and as of December 31, 2017 , no securitized vacation ownership notes receivable pools were out of compliance with their respective established parameters. As of December 31, 2017 , we had 8 securitized vacation ownership notes receivable pools outstanding. Convertible Notes During the 2017 third quarter, we issued $230.0 million aggregate principal amount of Convertible Notes, which included the exercise in full of the over-allotment option we granted to the initial purchasers of the Convertible Notes to purchase up to an additional $30.0 million aggregate principal amount of Convertible Notes. The Convertible Notes are governed by an indenture dated September 25, 2017 (the “Indenture”) between us and The Bank of New York Mellon Trust Company, N.A., as trustee (the “Trustee”). We received net proceeds from the offering of approximately $223.7 million after adjusting for debt issuance costs, including the discount to the initial purchasers. The Convertible Notes bear interest at a rate of 1.50 percent, payable in cash semi-annually on March 15 and September 15 of each year beginning on March 15, 2018. The Convertible Notes mature on September 15, 2022, unless repurchased or converted in accordance with their terms prior to that date. On or after June 15, 2022, and until the close of business on the second scheduled trading day immediately preceding the maturity date, holders may convert their Convertible Notes at their option. The Convertible Notes are convertible at an initial rate of 6.7482 shares of common stock per $1,000 principal amount of Convertible Notes (equivalent to an initial conversion price of approximately $148.19 per share of our common stock). The conversion rate is subject to adjustment for certain events as described in the Indenture. The conversion rate was adjusted during the 2017 fourth quarter to 6.7508 shares of common stock per $1,000 principal amount of Convertible Notes (equivalent to a conversion price of approximately $148.13 per share of our common stock) when we declared a quarterly dividend of $0.40 per share, which was greater than the quarterly dividend at the time of the issuance of the Convertible Notes. Upon conversion, we will pay or deliver, as the case may be, cash, shares of our common stock or a combination of cash and shares of our common stock, at our election. It is our intent to settle conversions of the Convertible Notes through combination settlement, which contemplates repayment in cash of the principal amount and repayment in shares of our common stock of any excess of the conversion value over the principal amount. Holders may convert their Convertible Notes prior to June 15, 2022 only under the following circumstances: • during any calendar quarter commencing after the calendar quarter ending on December 31, 2017 (and only during such calendar quarter), if the last reported sale price of our common stock for at least 20 trading days (whether or not consecutive) during the period of 30 consecutive trading days ending on the last trading day of the immediately preceding calendar quarter is greater than or equal to 130 percent of the conversion price on each applicable trading day; • during the five business day period after any five consecutive trading day period in which the trading price per $1,000 principal amount of the Convertible Notes for each trading day of that five consecutive trading day period was less than 98 percent of the product of the last reported sale price of our common stock and the conversion rate on each such trading day; or • upon the occurrence of specified corporate events as described in the Indenture. We may not redeem the Convertible Notes prior to their maturity date, and no sinking fund is provided for them. If we undergo a fundamental change, as described in the Indenture, subject to certain conditions, holders may require us to repurchase for cash all or any portion of their Convertible Notes. The repurchase price as a result of a fundamental change is equal to 100 percent of the principal amount of the Convertible Notes to be repurchased, plus accrued and unpaid interest to, but excluding, the repurchase date. If certain fundamental changes referred to in the Indenture as make-whole fundamental changes occur, the conversion rate applicable to the Convertible Notes may increase. The Convertible Notes are our general senior unsecured obligations, ranking senior in right of payment to any future debt that is expressly subordinated in right of payment to the Convertible Notes and equally in right of payment with all of our existing and future liabilities that are not so subordinated. The Convertible Notes are effectively subordinated to all of our existing and future secured debt to the extent of the value of the assets securing such debt. The Convertible Notes are structurally subordinated to all of the existing and future liabilities and obligations of our subsidiaries. The Convertible Notes are not guaranteed by any of our subsidiaries. There are no financial or operating covenants related to the Convertible Notes. The Indenture contains customary events of default with respect to the Convertible Notes and provides that upon the occurrence and continuation of certain events of default, the Trustee or the holders of at least 25 percent in aggregate principal amount of the Convertible Notes then outstanding, may declare all principal of, and accrued and any unpaid interest on, the Convertible Notes then outstanding to be immediately due and payable. In case of certain events of bankruptcy or insolvency involving the Company or certain of its subsidiaries, all of the principal of and accrued and unpaid interest on the Convertible Notes will automatically become immediately due and payable. In accounting for the issuance of the Convertible Notes, we separated the Convertible Notes into liability and equity components, and allocated $196.8 million to the liability component and $33.2 million to the equity component. The resulting debt discount is amortized as interest expense. As of December 31, 2017 , the remaining debt discount amortization period was 4.7 years . We also incurred issuance costs of $7.3 million related to the Convertible Notes. The following table shows the net carrying value of the Convertible Notes at December 31, 2017 : ($ in thousands) Liability component Principal amount $ 230,000 Unamortized debt discount (31,596 ) Unamortized debt issuance costs (5,886 ) $ 192,518 Equity component, net of issuance costs $ 32,573 The following table shows the total interest expense related to the Convertible Notes for the year ended December 31, 2017 : ($ in thousands) Contractual interest expense $ 920 Amortization of debt discount 1,629 Amortization of debt issuance costs 325 $ 2,874 Convertible Note Hedges and Warrants In connection with the offering of the Convertible Notes, we entered into privately-negotiated convertible note hedge transactions with respect to our common stock with two counterparties on each of September 20, 2017 and September 21, 2017 (“Convertible Note Hedges”), covering a total of approximately 1.55 million shares of our common stock at a cost of $33.2 million . The Convertible Note Hedges are subject to anti-dilution provisions substantially similar to those of the Convertible Notes, have a strike price that initially corresponds to the initial conversion price of the Convertible Notes, are exercisable by us upon any conversion under the Convertible Notes, and expire when the Convertible Notes mature. The cost of the Convertible Note Hedges is expected to be tax deductible as an original issue discount over the life of the Convertible Notes, as the Convertible Notes and the Convertible Note Hedges represent an integrated debt instrument for tax purposes. The cost of the Convertible Note Hedges was recorded as a reduction of Additional paid-in capital on our Balance Sheet as of December 31, 2017 . Concurrently with the entry into the Convertible Note Hedges, we separately entered into privately-negotiated warrant transactions (the “Warrants”), whereby we sold to the counterparties to the Convertible Note Hedges warrants to acquire, collectively, subject to anti-dilution adjustments, approximately 1.55 million shares of our common stock at an initial strike price of $176.68 per share. We received aggregate proceeds of approximately $20.3 million from the sale of the Warrants to the counterparties. Taken together, the Convertible Note Hedges and the Warrants are generally expected to reduce the potential dilution to our common stock (or, in the event the conversion of the Convertible Notes is settled in cash, to reduce our cash payment obligation) in the event that at the time of conversion our stock price exceeds the conversion price under the Convertible Notes and to effectively increase the overall conversion price from $148.19 (or a conversion premium of 30 percent) to $176.68 per share (or a conversion premium of 55 percent). The Warrants will expire in ratable portions on a series of expiration dates commencing on December 15, 2022. The proceeds from the issuance of the Warrants were recorded as an increase to Additional paid-in capital on our Balance Sheet as of December 31, 2017 . The Convertible Notes, the Convertible Note Hedges and the Warrants are transactions that are separate from each other. Holders of any such instrument have no rights with respect to the other instruments. As of December 31, 2017 , no Convertible Note Hedges or Warrants have been exercised. Revolving Corporate Credit Facility During the 2017 third quarter, we terminated our $200.0 million revolving credit facility (the “Previous Revolving Corporate Credit Facility”) and entered into a new Revolving Corporate Credit Facility with a borrowing capacity of $250.0 million , including a letter of credit sub-facility of $30.0 million , that terminates on August 16, 2022. All outstanding cash borrowings under our Previous Revolving Corporate Credit Facility were repaid in full prior to termination. The Revolving Corporate Credit Facility provides support for our business, including ongoing liquidity and letters of credit. Borrowings under this facility generally bear interest at a floating rate plus an applicable margin that varies from 0.50 percent to 2.75 percent depending on the type of loan and our credit rating. In addition, we pay a commitment fee on the unused availability under the Revolving Corporate Credit Facility at a rate that varies from 20 basis points per annum to 40 basis points per annum, also depending on our credit rating. No cash borrowings were outstanding as of December 31, 2017 under our Revolving Corporate Credit Facility. Any amounts borrowed under that facility, as well as obligations with respect to letters of credit issued pursuant to that facility, are secured by a perfected first priority security interest in substantially all of the assets of the borrower under, and guarantors of, that facility (which include Marriott Vacations Worldwide and each of our direct and indirect, existing and future, domestic subsidiaries, excluding certain bankruptcy remote special purpose subsidiaries), in each case including inventory, subject to certain exceptions. As of December 31, 2017 , we were in compliance with the applicable financial and operating covenants under the Revolving Credit Facility. Warehouse Credit Facility The Warehouse Credit Facility, which has a borrowing capacity of $250.0 million , allows for the securitization of vacation ownership notes receivable on a non-recourse basis. During the 2017 third quarter, we amended certain agreements associated with this facility (the “Warehouse Amendment”). The Warehouse Amendment requires us to comply with the financial covenants in the Revolving Corporate Credit Facility and eliminates the requirement to comply with the covenants contained in the Previous Revolving Corporate Credit Facility. The Warehouse Amendment did not modify the borrowing capacity or the term of the Warehouse Credit Facility. The Warehouse Credit Facility terminates on March 7, 2019 and if not renewed, any amounts outstanding thereunder would become due and payable 13 months after termination, at which time all principal and interest collected with respect to the vacation ownership notes receivable held in the Warehouse Credit Facility would be redirected to the lenders to pay down the outstanding debt under the facility. The advance rate for vacation ownership notes receivable securitized using the Warehouse Credit Facility varies based on the characteristics of the securitized vacation ownership notes receivable. We also pay unused facility and other fees under the Warehouse Credit Facility. During the 2017 second quarter, we securitized vacation ownership notes receivable under our Warehouse Credit Facility. The carrying amount of the vacation ownership notes receivable securitized was $59.1 million . The advance rate was 85 percent, which resulted in gross proceeds of $50.3 million . Net proceeds were $50.0 million due to the funding of reserve accounts in the amount of $0.3 million . As of December 31, 2017 , there were no cash borrowings outstanding under our Warehouse Credit Facility. We generally expect to securitize our vacation ownership notes receivable, including any vacation ownership notes receivable held in the Warehouse Credit Facility, in the ABS market once per year. Non-Interest Bearing Note Payable During the 2017 second quarter, we issued a non-interest bearing note payable in connection with the acquisition of vacation ownership units located on the Big Island of Hawaii. See Footnote No. 5, “Acquisitions and Dispositions,” for additional information regarding this transaction. Capital Leases |
SHAREHOLDERS' EQUITY
SHAREHOLDERS' EQUITY | 12 Months Ended |
Dec. 31, 2017 | |
Equity [Abstract] | |
SHAREHOLDERS' EQUITY | SHAREHOLDERS’ EQUITY Marriott Vacations Worldwide has 100,000,000 authorized shares of common stock, par value of $0.01 per share. At December 31, 2017 , there were 36,861,843 shares of Marriott Vacations Worldwide common stock issued, of which 26,461,296 shares were outstanding and 10,400,547 shares were held as treasury stock. At December 30, 2016 , there were 36,633,868 shares of Marriott Vacations Worldwide common stock issued, of which 26,990,306 shares were outstanding and 9,643,562 shares were held as treasury stock. Marriott Vacations Worldwide has 2,000,000 authorized shares of preferred stock, par value of $0.01 per share, none of which were issued or outstanding as of December 31, 2017 or December 30, 2016 . Share Repurchase Program The following table summarizes share repurchase activity under our current share repurchase program: ($ in thousands, except per share amounts) Number of Cost of Shares Average Price As of December 30, 2016 9,672,629 $ 608,439 $ 62.90 For the year ended December 31, 2017 767,876 88,305 115.00 As of December 31, 2017 10,440,505 $ 696,744 $ 66.73 On August 1, 2017, our Board of Directors authorized the repurchase of up to 1.0 million additional shares of our common stock under our existing share repurchase program and extended the duration of the program through May 31, 2018. As of December 31, 2017 , our Board of Directors had authorized the repurchase of an aggregate of up to 11.9 million shares of our common stock under the share repurchase program since the initiation of the program in October 2013. Share repurchases may be made through open market purchases, privately negotiated transactions, block transactions, tender offers, accelerated share repurchase agreements or otherwise. The specific timing, amount and other terms of the repurchases will depend on market conditions, corporate and regulatory requirements and other factors. Acquired shares of our common stock are held as treasury shares carried at cost in our Financial Statements. In connection with the repurchase program, we are authorized to adopt one or more trading plans pursuant to the provisions of Rule 10b5-1 under the Securities Exchange Act of 1934, as amended. As of December 31, 2017 , 1.5 million shares remained available for repurchase under the authorization approved by our Board of Directors. The authorization for the share repurchase program may be suspended, terminated, increased or decreased by our Board of Directors at any time without prior notice. Dividends We declared cash dividends to holders of common stock during the year ended December 31, 2017 as follows: Declaration Date Shareholder Record Date Distribution Date Dividend per Share February 9, 2017 February 23, 2017 March 9, 2017 $0.35 May 11, 2017 May 25, 2017 June 8, 2017 $0.35 September 7, 2017 September 21, 2017 October 5, 2017 $0.35 December 7, 2017 December 21, 2017 January 4, 2018 $0.40 |
SHARE-BASED COMPENSATION
SHARE-BASED COMPENSATION | 12 Months Ended |
Dec. 31, 2017 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
SHARE-BASED COMPENSATION | SHARE-BASED COMPENSATION We maintain the Stock Plan for the benefit of our officers, directors and employees. Under the Stock Plan, we award: (1) RSUs of our common stock, (2) SARs for our common stock and (3) stock options to purchase our common stock. A total of 6 million shares are authorized for issuance pursuant to grants under the Stock Plan. As of December 31, 2017 , 1.4 million shares were available for grants under the Stock Plan. The following table details our share-based compensation expense related to award grants to our officers, directors and employees: ($ in thousands) 2017 2016 2015 Service based RSUs $ 10,147 $ 9,372 $ 8,879 Performance based RSUs 3,752 2,502 3,343 13,899 11,874 12,222 SARs 2,387 2,075 1,920 Stock options — — — $ 16,286 $ 13,949 $ 14,142 The following table details our deferred compensation costs related to unvested awards: ($ in thousands) At Year-End 2017 (1) At Year-End 2016 Service based RSUs $ 8,918 $ 9,000 Performance based RSUs 4,752 3,307 13,670 12,307 SARs 999 1,146 Stock options — — $ 14,669 $ 13,453 _________________________ (1) As of December 31, 2017 , the weighted average remaining term for RSU grants outstanding at year-end 2017 was 1.8 years and we expect that deferred compensation expense will be recognized over a weighted average period of 2.4 years. Restricted Stock Units We have issued RSUs that vest over time, which we refer to as service based RSUs, and RSUs that vest based on performance with respect to established criteria, which we refer to as performance based RSUs. The following table shows the changes in our outstanding RSUs and the associated weighted average grant-date fair values: 2017 Service Based Performance Based Total Number of RSUs Weighted Average Grant-Date Fair Value Per RSU Number of RSUs Weighted Average Grant-Date Fair Value Per RSU Number of RSUs Weighted Average Grant-Date Fair Value Per RSU Outstanding at year-end 2016 514,947 $ 49.36 279,284 $ 61.30 794,231 $ 53.56 Granted 115,334 $ 96.53 94,436 $ 93.41 209,770 $ 95.12 Distributed (152,783) $ 51.88 (50,978) $ 52.09 (203,761) $ 51.93 Forfeited (6,491) $ 74.47 (11,230) $ 52.09 (17,721) $ 60.28 Outstanding at year-end 2017 471,007 $ 59.49 311,512 $ 72.89 782,519 $ 64.83 The weighted average grant-date fair value per RSU granted in 2016 and 2015 was $53.56 and $ 75.61 , respectively. The fair value of RSUs which vested in 2017 , 2016 and 2015 , was $ 18.2 million , $ 13.2 million and $ 30.0 million , respectively. SARs The following table shows the changes in our outstanding SARs and the associated weighted average exercise prices: 2017 Number of Weighted Average Exercise Price Per SAR Outstanding at year-end 2016 781,903 $ 34.97 Granted 81,977 97.53 Exercised (205,427) 19.35 Forfeited or expired — — Outstanding at year-end 2017 (1)(2) 658,453 $ 47.63 _________________________ (1) As of December 31, 2017 , outstanding SARs had a total intrinsic value of $ 58.3 million and a weighted average remaining term of 5.9 years. (2) As of December 31, 2017 , 431,543 SARs with a weighted average exercise price of $ 32.62 , an aggregate intrinsic value of $ 44.7 million and a weighted average remaining contractual term of 4.6 years were exercisable. The weighted average grant-date fair value per SAR granted in 2017 , 2016 and 2015 was $ 27.63 , $ 16.12 and $ 29.75 , respectively. The intrinsic value of SARs which vested in 2017 , 2016 and 2015 , was $ 6.2 million , $ 1.4 million and $ 4.7 million , respectively. The aggregate intrinsic value of SARs which were exercised in 2017 , 2016 and 2015 was $ 18.7 million , $ 5.6 million and $ 4.3 million , respectively. We use the Black-Scholes model to estimate the fair value of the SARs granted. For SARs granted under the Stock Plan subsequent to the Spin-Off, the expected stock price volatility was calculated based on the historical volatility from the stock prices of a group of identified peer companies. The average expected life was calculated using the simplified method. The risk-free interest rate was calculated based on U.S. Treasury zero-coupon issues with a remaining term equal to the expected life assumed at the date of grant. The dividend yield assumption listed below is based on the expectation of future payouts. The following table outlines the assumptions used to estimate the fair value of grants in 2017, 2016 and 2015: 2017 2016 2015 Expected volatility 30.41% 31.60% 42.74% Dividend yield 1.44% 1.96% 1.26% Risk-free rate 2.06% 1.41% 1.74% Expected term (in years) 6.25 6.25 6.25 Stock Options We may grant non-qualified stock options to employees and non-employee directors at exercise prices or strike prices equal to the market price of our common stock on the date of grant. There were no outstanding or exercisable stock options held by our employees at year-end 2017 or 2016 , and no stock options were granted to our employees in 2017 , 2016 or 2015 . At December 31, 2017 , approximately 9,000 stock options were outstanding and exercisable with a weighted average exercise price per option of $18.36 and a weighted average remaining life of approximately two years. Employee Stock Purchase Plan During 2015, the Board of Directors adopted, and our shareholders subsequently approved, the Marriott Vacations Worldwide Corporation Employee Stock Purchase Plan (the “ESPP”), which became effective during 2015. A total of 500,000 shares of common stock may be purchased under the ESPP. The ESPP allows eligible employees to purchase shares of our common stock at a price per share not less than 95% |
VARIABLE INTEREST ENTITIES
VARIABLE INTEREST ENTITIES | 12 Months Ended |
Dec. 31, 2017 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
VARIABLE INTEREST ENTITIES | VARIABLE INTEREST ENTITIES Variable Interest Entities Related to Our Vacation Ownership Notes Receivable Securitizations We periodically securitize, without recourse, through bankruptcy remote special purpose entities, notes receivable originated in connection with the sale of vacation ownership products. These vacation ownership notes receivable securitizations provide funding for us and transfer the economic risks and substantially all the benefits of the consumer loans we originate to third parties. In a vacation ownership notes receivable securitization, various classes of debt securities issued by a special purpose entity are generally collateralized by a single tranche of transferred assets, which consist of vacation ownership notes receivable. With each vacation ownership notes receivable securitization, we may retain a portion of the securities, subordinated tranches, interest-only strips, subordinated interests in accrued interest and fees on the securitized vacation ownership notes receivable or, in some cases, overcollateralization and cash reserve accounts. We created these bankruptcy remote special purpose entities to serve as a mechanism for holding assets and related liabilities, and the entities have no equity investment at risk, making them variable interest entities. We continue to service the vacation ownership notes receivable, transfer all proceeds collected to these special purpose entities, and retain rights to receive benefits that are potentially significant to the entities. Accordingly, we concluded that we are the entities’ primary beneficiary and, therefore, consolidate them. The following table shows consolidated assets, which are collateral for the obligations of these variable interest entities, and consolidated liabilities included on our Balance Sheet at December 31, 2017 : ($ in thousands) Vacation Ownership Warehouse Total Consolidated Assets Vacation ownership notes receivable, net of reserves $ 815,331 $ — $ 815,331 Interest receivable 5,639 — 5,639 Restricted cash 32,317 4 32,321 Total $ 853,287 $ 4 $ 853,291 Consolidated Liabilities Interest payable $ 651 $ 50 $ 701 Debt 845,131 — 845,131 Total $ 845,782 $ 50 $ 845,832 The noncontrolling interest balance was zero . The creditors of these entities do not have general recourse to us. The following table shows the interest income and expense recognized as a result of our involvement with these variable interest entities during 2017 : ($ in thousands) Vacation Ownership Warehouse Total Interest income $ 98,862 $ 2,331 $ 101,193 Interest expense to investors $ 18,872 $ 1,676 $ 20,548 Debt issuance cost amortization $ 3,731 $ 938 $ 4,669 Administrative expenses $ 409 $ 153 $ 562 The following table shows cash flows between us and the vacation ownership notes receivable securitization variable interest entities: ($ in thousands) 2017 2016 Cash Inflows Net proceeds from vacation ownership notes receivable securitizations $ 346,469 $ 247,453 Principal receipts 228,723 174,830 Interest receipts 99,766 91,972 Reserve release 757 50,733 Total 675,715 564,988 Cash Outflows Principal to investors (214,907 ) (166,652 ) Voluntary repurchases of defaulted vacation ownership notes receivable (28,324 ) (29,590 ) Interest to investors (18,630 ) (17,449 ) Funding of restricted cash (1,804 ) (51,770 ) Total (263,665 ) (265,461 ) Net Cash Flows $ 412,050 $ 299,527 The following table shows cash flows between us and the Warehouse Credit Facility variable interest entity: ($ in thousands) 2017 2016 Cash Inflows Proceeds from vacation ownership notes receivable securitizations $ 50,260 $ 126,622 Principal receipts 1,403 5,227 Interest receipts 2,093 5,048 Reserve release 296 909 Total 54,052 137,806 Cash Outflows Principal to investors (1,160 ) (3,771 ) Voluntary repurchases of defaulted vacation ownership notes receivable — (661 ) Repayment of Warehouse Credit Facility (49,100 ) (122,190 ) Interest to investors (1,672 ) (1,796 ) Funding of restricted cash (296 ) (447 ) Total (52,228 ) (128,865 ) Net Cash Flows $ 1,824 $ 8,941 Under the terms of our vacation ownership notes receivable securitizations, we have the right at our option to repurchase defaulted vacation ownership notes receivable at the outstanding principal balance. The transaction documents typically limit such repurchases to 15 to 20 percent of the transaction’s initial vacation ownership notes receivable principal balance. We made voluntary repurchases of defaulted vacation ownership notes receivable of $28.3 million during 2017 , $30.3 million during 2016 and $24.6 million during 2015 . We also made voluntary repurchases of $57.4 million , $144.1 million and $146.2 million of other non-defaulted vacation ownership notes receivable during 2017 , 2016 and 2015 , respectively, to retire previous vacation ownership notes receivable securitizations. Our maximum exposure to loss relating to the special purpose entities that purchase, sell and own these vacation ownership notes receivable is the overcollateralization amount (the difference between the loan collateral balance and the balance on the outstanding vacation ownership notes receivable), plus cash reserves and any residual interest in future cash flows from collateral. In addition, we could be required to fund up to an aggregate of $5.0 million upon presentation of demand notes related to certain vacation ownership notes receivable securitization transactions outstanding at December 31, 2017 . Other Variable Interest Entities We have a commitment to purchase an operating property located in New York, New York, that we currently manage as Marriott Vacation Club Pulse, New York City. Refer to Footnote No. 9, “Contingencies and Commitments” for additional information on the commitment. We are required to purchase the completed property from the third party developer unless the developer has sold the property to another party. The property is held by a variable interest entity for which we are not the primary beneficiary as we cannot prevent the variable interest entity from selling the property at a higher price. Accordingly, we have not consolidated the variable interest entity. As of December 31, 2017 , our Balance Sheet reflected $8.3 million in Property and equipment related to a capital lease and leasehold improvements and $7.2 million in Debt related to the capital lease liability for ancillary and operations space we lease from the variable interest entity. In addition, a note receivable of $0.5 million is included in the Accounts and contracts receivable line on the Balance Sheet as of December 31, 2017. We believe that our maximum exposure to loss as a result of our involvement with this variable interest entity is $2.3 million as of December 31, 2017 . Pursuant to a commitment to repurchase an operating property located in Marco Island, Florida that was previously sold to a third-party developer, we acquired 36 completed vacation ownership units during the 2017 second quarter. Refer to Footnote No. 5, “Acquisitions and Dispositions” for additional information on this transaction. We remain obligated to repurchase the remaining portion of the operating property if it meets our brand standards upon completion, provided that the third-party developer has not sold it to another party. Refer to Footnote No. 9, “Contingencies and Commitments” for additional information on our remaining commitment. The developer is a variable interest entity for which we are not the primary beneficiary as we do not control the variable interest entity’s development activities and cannot prevent the variable interest entity from selling the property at a higher price. Accordingly, we have not consolidated the variable interest entity. As of December 31, 2017 , our Balance Sheet reflected $3.7 million of Inventory, $2.4 million of Other assets that relate to prepaid and other deposits, and $7.5 million of Other liabilities that relate to the deferral of gain recognition on the previous sale transaction and the deferral of revenue for development management services for the remaining purchase commitment, both of which will reduce our basis in the asset if we repurchase the property. In addition, a note receivable of $0.5 million is included in the Accounts and contracts receivable line on the Balance Sheet as of December 31, 2017 . We believe that our maximum exposure to loss as a result of our involvement with this variable interest entity is less than $1 million as of December 31, 2017 |
BUSINESS SEGMENTS
BUSINESS SEGMENTS | 12 Months Ended |
Dec. 31, 2017 | |
Segment Reporting [Abstract] | |
BUSINESS SEGMENTS | BUSINESS SEGMENTS We define our reportable segments based on the way in which the chief operating decision maker, currently our chief executive officer, manages the operations of the company for purposes of allocating resources and assessing performance. We operate in three reportable business segments: • In our North America segment, we develop, market, sell and manage vacation ownership and related products under the Marriott Vacation Club and Grand Residences by Marriott brands, as well as under Marriott Vacation Club Pulse, an extension to the Marriott Vacation Club brand. We also develop, market and sell vacation ownership and related products under The Ritz-Carlton Destination Club brand, as well as whole ownership residential products under The Ritz-Carlton Residences brand. • In our Asia Pacific segment, we develop, market, sell and manage two points-based programs that we specifically designed to appeal to the vacation preferences of the market, Marriott Vacation Club, Asia Pacific and Marriott Vacation Club Destinations, Australia, as well as a weeks-based right-to-use product. • In our Europe segment, we are focusing on selling our existing projects and managing existing resorts. We do not have any current plans for new development in this segment. We evaluate the performance of our segments based primarily on the results of the segment without allocating corporate expenses or income taxes. We do not allocate corporate interest expense, consumer financing interest expense, other financing expenses or general and administrative expenses to our segments. We include interest income specific to segment activities within the appropriate segment. We allocate other gains and losses and equity in earnings or losses from our joint ventures to each of our segments as appropriate. Corporate and other represents that portion of our revenues and other gains or losses that are not allocable to our segments. Revenues ($ in thousands) 2017 2016 (1) 2015 (1) North America $ 1,777,345 $ 1,627,916 $ 1,605,102 Asia Pacific 67,773 74,949 93,632 Europe 106,827 105,621 112,061 Total segment revenues 1,951,945 1,808,486 1,810,795 Corporate and other — — — $ 1,951,945 $ 1,808,486 $ 1,810,795 _________________________ (1) Results have been reclassified to conform to our 2017 financial statement presentation. Net Income ($ in thousands) 2017 2016 (1) 2015 (1) North America $ 427,873 $ 423,334 $ 409,596 Asia Pacific (968 ) 1,278 7,263 Europe 14,678 12,067 13,874 Total segment financial results 441,583 436,679 430,733 Corporate and other (215,700 ) (213,751 ) (224,236 ) Benefit (provision) for income taxes 895 (85,580 ) (83,698 ) $ 226,778 $ 137,348 $ 122,799 _________________________ (1) Results have been reclassified to conform to our 2017 financial statement presentation. Depreciation ($ in thousands) 2017 2016 2015 North America $ 12,869 $ 12,046 $ 12,935 Asia Pacific 880 1,235 2,424 Europe 1,308 1,462 1,601 Total segment depreciation 15,057 14,743 16,960 Corporate and other 6,437 6,301 5,257 $ 21,494 $ 21,044 $ 22,217 Assets ($ in thousands) At Year-End 2017 At Year-End 2016 North America $ 2,143,664 $ 1,968,021 Asia Pacific 134,939 102,348 Europe 64,535 62,245 Total segment assets 2,343,138 2,132,614 Corporate and other 563,055 258,805 $ 2,906,193 $ 2,391,419 Capital Expenditures (including inventory) ($ in thousands) 2017 2016 2015 North America $ 142,897 $ 136,889 $ 179,696 Asia Pacific 26,475 21,276 72,097 Europe 5,047 6,153 2,807 Total segment capital expenditures 174,419 164,318 254,600 Corporate and other 7,068 8,412 10,260 $ 181,487 $ 172,730 $ 264,860 Our Financial Statements include the following items related to operations located outside the United States (which are predominately related to our Asia Pacific and Europe segments): • Revenues, excluding cost reimbursements, of $191.8 million in 2017 , $195.4 million in 2016 and $218.3 million in 2015 ; and • Fixed assets of $77.3 million in 2017 and $60.0 million in 2016 . For year-end 2017 and year-end 2016 |
QUARTERLY RESULTS (UNAUDITED)
QUARTERLY RESULTS (UNAUDITED) | 12 Months Ended |
Dec. 31, 2017 | |
Quarterly Financial Information Disclosure [Abstract] | |
QUARTERLY RESULTS (UNAUDITED) | QUARTERLY RESULTS (UNAUDITED) 2017 (1)(2) ($ in thousands, except per share data) First Second Third Fourth Fiscal Revenues $ 486,119 $ 497,620 $ 486,990 $ 481,216 $ 1,951,945 Expenses $ (432,555 ) $ (430,204 ) $ (428,300 ) $ (429,604 ) $ (1,720,663 ) Net income $ 33,700 $ 44,276 $ 40,762 $ 108,040 $ 226,778 Basic earnings per share $ 1.24 $ 1.62 $ 1.50 $ 4.05 $ 8.38 Diluted earnings per share $ 1.21 $ 1.58 $ 1.47 $ 3.95 $ 8.18 2016 (2)(3)(4) ($ in thousands, except per share data) First Second Third Fourth Fiscal Revenues $ 419,122 $ 423,171 $ 401,637 $ 564,556 $ 1,808,486 Expenses $ (374,440 ) $ (368,674 ) $ (358,906 ) $ (481,195 ) $ (1,583,215 ) Net income $ 24,408 $ 36,309 $ 26,807 $ 49,824 $ 137,348 Basic earnings per share $ 0.84 $ 1.28 $ 0.99 $ 1.83 $ 4.93 Diluted earnings per share $ 0.82 $ 1.26 $ 0.97 $ 1.80 $ 4.83 _______________________ (1) Beginning with our 2017 fiscal year, we changed our financial reporting cycle to a calendar year-end and end-of-month quarterly reporting cycle. Accordingly our 2017 first quarter included the period from December 31, 2016 (the day after the end of the 2016 fiscal year) through March 31, 2017, and our 2017 second, third and fourth quarters included the three month periods ended June 30, September 30, and December 31, respectively. (2) The sum of the earnings per share for the four quarters differs from annual earnings per share due to the required method of computing the weighted average shares in interim periods. (3) The 2016 quarters consisted of 12 weeks, except for the fourth quarter of 2016, which consisted of 16 weeks. (4) |
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS | 12 Months Ended |
Dec. 31, 2017 | |
Subsequent Events [Abstract] | |
SUBSEQUENT EVENTS | SUBSEQUENT EVENTS Dividends On February 16, 2018, our Board of Directors declared a quarterly dividend of $0.40 per share to be paid on March 15, 2018 to shareholders of record as of March 1, 2018. Amendments to Agreements with Marriott International |
ADOPTION OF ASC 606 EFFECTIVE J
ADOPTION OF ASC 606 EFFECTIVE JANUARY 1, 2018 | 12 Months Ended |
Dec. 31, 2017 | |
Accounting Changes and Error Corrections [Abstract] | |
ADOPTION OF ASC 606 EFFECTIVE JANUARY 1, 2018 | ADOPTION OF ASC 606 EFFECTIVE JANUARY 1, 2018 As discussed in Footnote No. 1, “Summary of Significant Accounting Policies,” the FASB issued ASU 2014-09 in 2014, which, as amended, created ASC 606. The core principle of ASC 606 is that an entity shall recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The standard also contains significant new disclosure requirements regarding the nature, amount, timing, and uncertainty of revenue and cash flows arising from contracts with customers. We will adopt ASC 606 effective January 1, 2018, on a retrospective basis. Upon adoption of ASC 606, recognition of revenue from the sale of vacation ownership products that is deemed collectible will be deferred from the point in time at which the statutory rescission period expires to closing, when control of the vacation ownership product is transferred to the customer. In addition, we will align our assessment of collectibility of the transaction price for sales of vacation ownership products with our credit granting policies. We have elected the practical expedient to expense all marketing and sales costs as they are incurred. Our consolidated cost reimbursements revenues and cost reimbursements expenses will increase significantly, as all costs reimbursed to us by property owners’ associations will be reported on a gross basis upon adoption of ASC 606. In conjunction with the adoption of ASC 606 we will reclassify certain revenues and expenses. The following tables summarize the impact of the aforementioned adjustments on select financial statement line items for the periods presented: 2017 ($ in thousands, except per share amounts) As Reported Adjustments As Adjusted REVENUES Sale of vacation ownership products $ 727,940 $ 29,498 $ 757,438 Resort management and other services 306,196 (27,358 ) 278,838 Financing 134,906 — 134,906 Rental 322,902 (60,863 ) 262,039 Cost reimbursements 460,001 289,601 749,602 TOTAL REVENUES 1,951,945 230,878 2,182,823 EXPENSES Cost of vacation ownership products 177,813 17,034 194,847 Marketing and sales 408,715 (13,825 ) 394,890 Resort management and other services 172,137 (17,913 ) 154,224 Financing 17,951 — 17,951 Rental 281,352 (57,970 ) 223,382 General and administrative 110,225 — 110,225 Litigation settlement 4,231 — 4,231 Consumer financing interest 25,217 — 25,217 Royalty fee 63,021 — 63,021 Cost reimbursements 460,001 289,601 749,602 TOTAL EXPENSES 1,720,663 216,927 1,937,590 Gains and other income, net 5,772 — 5,772 Interest expense (9,572 ) — (9,572 ) Other (1,599 ) — (1,599 ) INCOME BEFORE INCOME TAXES 225,883 13,951 239,834 Benefit (provision) for income taxes 895 (5,405 ) (4,510 ) NET INCOME $ 226,778 $ 8,546 $ 235,324 EARNINGS PER SHARE Earnings per share - Basic $ 8.38 $ 0.32 $ 8.70 Earnings per share - Diluted $ 8.18 $ 0.31 $ 8.49 2016 ($ in thousands, except per share amounts) As Reported Adjustments As Adjusted REVENUES Sale of vacation ownership products $ 637,503 $ (15,078 ) $ 622,425 Resort management and other services 300,821 (23,285 ) 277,536 Financing 126,126 881 127,007 Rental 312,071 (59,707 ) 252,364 Cost reimbursements 431,965 288,507 720,472 TOTAL REVENUES 1,808,486 191,318 1,999,804 EXPENSES Cost of vacation ownership products 155,093 7,850 162,943 Marketing and sales 353,295 (13,682 ) 339,613 Resort management and other services 174,311 (17,576 ) 156,735 Financing 18,631 135 18,766 Rental 260,752 (49,186 ) 211,566 General and administrative 104,833 — 104,833 Litigation settlement (303 ) — (303 ) Consumer financing interest 23,685 — 23,685 Royalty fee 60,953 — 60,953 Cost reimbursements 431,965 288,507 720,472 TOTAL EXPENSES 1,583,215 216,048 1,799,263 Gains and other income, net 11,201 — 11,201 Interest expense (8,912 ) — (8,912 ) Other (4,632 ) — (4,632 ) INCOME BEFORE INCOME TAXES 222,928 (24,730 ) 198,198 (Provision) benefit for income taxes (85,580 ) 9,320 (76,260 ) NET INCOME $ 137,348 $ (15,410 ) $ 121,938 EARNINGS PER SHARE Earnings per share - Basic $ 4.93 $ (0.56 ) $ 4.37 Earnings per share - Diluted $ 4.83 $ (0.54 ) $ 4.29 |
SUMMARY OF SIGNIFICANT ACCOUN25
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 12 Months Ended |
Dec. 31, 2017 | |
Accounting Policies [Abstract] | |
Our Business | Our Business Marriott Vacations Worldwide Corporation (“we,” “us,” “Marriott Vacations Worldwide,” or the “Company,” which includes our consolidated subsidiaries except where the context of the reference is to a single corporate entity) is the exclusive worldwide developer, marketer, seller and manager of vacation ownership and related products under the Marriott Vacation Club and Grand Residences by Marriott brands. In 2016, we introduced Marriott Vacation Club Pulse, an extension to the Marriott Vacation Club brand. We are also the exclusive worldwide developer, marketer and seller of vacation ownership and related products under The Ritz-Carlton Destination Club brand, and we have the non-exclusive right to develop, market and sell whole ownership residential products under The Ritz-Carlton Residences brand. The Ritz-Carlton Hotel Company, L.L.C. (“The Ritz-Carlton Hotel Company”), a subsidiary of Marriott International, Inc. (“Marriott International”), provides on-site management for Ritz-Carlton branded properties. Our business is grouped into three reportable segments: North America, Asia Pacific and Europe. As of December 31, 2017 , our portfolio consisted of over 65 properties in the United States and nine other countries and territories. We generate most of our revenues from four |
Our Spin-Off from Marriott International, Inc. | Our Spin-Off from Marriott InternationalOn November 21, 2011, the spin-off of Marriott Vacations Worldwide from Marriott International (the “Spin-Off”) was completed pursuant to a Separation and Distribution Agreement (the “Separation and Distribution Agreement”) between Marriott Vacations Worldwide and Marriott International. In connection with the Spin-Off, we entered into several agreements that govern the ongoing relationship between Marriott Vacations Worldwide and Marriott International. |
Principles of Consolidation and Basis of Presentation | Principles of Consolidation and Basis of Presentation The consolidated financial statements presented herein and discussed below include 100 percent of the assets, liabilities, revenues, expenses and cash flows of Marriott Vacations Worldwide, all entities in which Marriott Vacations Worldwide has a controlling voting interest (“subsidiaries”), and those variable interest entities for which Marriott Vacations Worldwide is the primary beneficiary in accordance with consolidation accounting guidance. Intercompany accounts and transactions between consolidated companies have been eliminated in consolidation. The consolidated financial statements reflect our financial position, results of operations and cash flows as prepared in conformity with United States Generally Accepted Accounting Principles (“GAAP”). In order to make this report easier to read, we refer throughout to (i) our Consolidated Financial Statements as our “Financial Statements,” (ii) our Consolidated Statements of Income as our “Income Statements,” (iii) our Consolidated Balance Sheets as our “Balance Sheets,” and (iv) our Consolidated Statements of Cash Flows as our “Cash Flows.” In addition, references throughout to numbered “Footnotes” refer to the numbered Notes in these Notes to Consolidated Financial Statements, unless otherwise noted. We use certain other terms that are defined within these Financial Statements. Unless otherwise specified, each reference to a particular year in these Financial Statements means the fiscal year ended on the date shown in the following table, rather than the corresponding calendar year. Beginning with our 2017 fiscal year, we changed our financial reporting cycle to a calendar year-end and end-of-month quarterly reporting cycle. Accordingly our 2017 fiscal year began on December 31, 2016 (the day after the end of the 2016 fiscal year) and ended on December 31, 2017. Our future fiscal years will begin on January 1 and end on December 31. As a result of the change in our financial reporting cycle, our 2017 fiscal year had two more days of activity than our 2016 and 2015 fiscal years. We have not restated, and do not plan to restate, historical results. Fiscal Year Fiscal Year-End Date Number of Days 2017 December 31, 2017 366 2016 December 30, 2016 364 2015 January 1, 2016 364 The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect amounts reported in the financial statements and accompanying notes. Such estimates include, but are not limited to, revenue recognition, cost of vacation ownership products, inventory valuation, property and equipment valuation, loan loss reserves, income taxes and loss contingencies. Accordingly, actual amounts may differ from these estimated amounts. We have reclassified certain prior year amounts to conform to our 2017 |
Revenue Recognition | Revenue Recognition Sale of Vacation Ownership Products We market and sell real estate and in substance real estate in our three reportable segments. Real estate and in substance real estate include deeded vacation ownership products, deeded beneficial interests, rights to use real estate, and other interests in trusts that solely hold real estate and deeded whole ownership units in residential buildings. Within the North America segment, we also market and sell residential units at certain properties on a limited basis. Sales of vacation ownership products may be made for cash or we may provide financing. We are not providing financing on sales of whole ownership products. Except for revenue from the sale of residential stand-alone structures, which we recognize upon transfer of title to a third party, we recognize revenue under the percentage-of-completion method when all of the following exist or are true: the customer has executed a binding sales contract, the statutory rescission period has expired (after which time the purchasers are not entitled to a refund except for non-delivery by us), we have deemed the receivable collectible and the remainder of our obligations are substantially completed. In addition, before we recognize any revenues, the purchaser must have met the initial investment criteria and, as applicable, the continuing investment criteria. A purchaser has met the initial investment criteria when we receive a minimum down payment. In accordance with the authoritative guidance for accounting for real estate time-sharing transactions, we must also take into consideration the fair value of certain incentives provided to the purchaser when assessing the adequacy of the purchaser’s initial investment. In those cases where we provide financing to the purchaser, the purchaser must be obligated to remit monthly payments under financing contracts that represent the purchaser’s continuing investment. Resort Management and Other Services Revenues Our resort management and other services revenues consist primarily of ancillary revenues and management fees. Ancillary revenues consist of goods and services that are sold or provided by us at restaurants, golf courses and other retail and service outlets located at our resorts. We recognize ancillary revenue when goods have been provided and/or services have been rendered. Ancillary revenues recorded as a component of Resort management and other services revenues were $118.2 million in 2017 , $124.2 million in 2016 and $125.2 million in 2015 , as reflected on our Income Statements. We provide day-to-day-management services, including housekeeping services, operation of reservation systems, maintenance and certain accounting and administrative services for property owners’ associations. We receive compensation for these management services; this is typically based on either a percentage of the budgeted costs to operate the resorts or a fixed fee arrangement. We recognize revenues when earned in accordance with the terms of the contract. Management fee revenues recorded as a component of Resort management and other services revenues were $87.8 million in 2017 , $83.3 million in 2016 and $77.6 million in 2015 , as reflected on our Income Statements. Resort management and other services revenues also include additional fees for services we provide to our property owners’ associations, as well as annual fees, club dues, settlement fees from the sale of vacation ownership products, and certain transaction-based fees from owners and other third parties, including external exchange service providers with which we are associated. We recognize fee revenues when services have been rendered. Fee revenues included in Resort management and other services revenues were $79.0 million in 2017 , $75.7 million in 2016 and $72.4 million in 2015 , as reflected on our Income Statements. Financing Revenues We offer consumer financing as an option to qualifying customers purchasing vacation ownership products, which is collateralized by the underlying vacation ownership products. We recognize interest income on an accrual basis. The contractual terms of the financing agreements require that the contractual level of annual principal payments be sufficient to amortize the loan over a customary period for the vacation ownership product being financed, which is generally ten years. Generally, payments commence under the financing contracts 30 to 60 days after closing. We record an estimate of uncollectible amounts at the time of the sale with a charge to the provision for loan losses, which we classify as a reduction of Sale of vacation ownership products on our Income Statements. Revisions to estimates of uncollectible amounts also impact the provision for loan losses and can increase or decrease revenue. We earn interest income from the financing arrangements on the principal balance outstanding over the life of the arrangement and record that interest income in Financing revenues on our Income Statements. Financing revenues include certain annual and transaction-based fees we charge to owners and other third parties for services. We recognize fee revenues when services have been rendered. Fee revenues included in Financing revenues were $6.9 million in 2017 , $6.0 million in 2016 and $6.0 million in 2015 , as reflected on our Income Statements. Rental Revenues We record rental revenues when occupancy has occurred or, in the case of unused prepaid rentals, upon forfeiture. We also recognize rental revenue from the utilization of plus points under the Marriott Vacation Club Destinations ™ (“MVCD”) program when those points are redeemed for rental stays at one of our resorts or in the Explorer Collection, or upon expiration of the points. Cost Reimbursements |
Inventory | Inventory Our inventory consists primarily of completed vacation ownership products, vacation ownership products under construction and land held for future vacation ownership product development. We carry our inventory at the lower of (1) cost, including costs of improvements and amenities incurred subsequent to acquisition, capitalized interest and real estate taxes plus other costs incurred during construction, or (2) estimated fair value, less costs to sell, which can result in impairment charges and/or recoveries of previous impairments. We account for vacation ownership inventory and cost of vacation ownership products in accordance with the authoritative guidance for accounting for real estate time-sharing transactions, which defines a specific application of the relative sales value method for reducing vacation ownership inventory and recording cost of sales as described in our policy for revenue recognition for vacation ownership products. Also, pursuant to the guidance for accounting for real estate time-sharing transactions, we do not reduce inventory for cost of vacation ownership products related to anticipated credit losses (accordingly, no adjustment is made when inventory is reacquired upon default of the related receivable). These standards provide for changes in estimates within the relative sales value calculations to be accounted for as real estate inventory true-ups, which we refer to as product cost true-up activity, and are recorded in Cost of vacation ownership product expenses on the Income Statements to retrospectively adjust the margin previously recorded subject to those estimates. For 2017 , 2016 and 2015 , product cost true-up activity relating to vacation ownership products increased carrying values of inventory by $0.3 million , $14.8 million and $7.3 million , respectively. For residential real estate projects, we allocate costs to individual residences in the projects based on the relative estimated sales value of each residence in accordance with Accounting Standards Codification (“ASC”) 970, “ Real Estate—General |
Capitalization of Costs | Capitalization of Costs We capitalize costs clearly associated with the acquisition of real estate when a transaction is accounted for as an asset acquisition under ASC 805, “ Business Combinations ” (“ASC 805”) . |
Defined Contribution Plan | Defined Contribution Plan We administer and maintain a defined contribution plan for the benefit of all employees meeting certain eligibility requirements who elect to participate in the plan. Contributions are determined based on a specified percentage of salary deferrals by participating employees. We recognized compensation expense (net of cost reimbursements from property owners’ associations) for our participating employees totaling $9.7 million in 2017 , $8.0 million in 2016 and $7.1 million in 2015 |
Deferred Compensation Plan | Deferred Compensation Plan Prior to the Spin-Off, certain members of our senior management had the opportunity to participate in the Marriott International, Inc. Executive Deferred Compensation Plan (the “Marriott International EDC”), which Marriott International maintains and administers. Under the Marriott International EDC, participating employees were able to defer payment and income taxation of a portion of their salary and bonus. Participants also had the opportunity for long-term capital appreciation by crediting their accounts with notional earnings (at a fixed annual rate of return of 4.0 percent for 2017 and 4.5 percent for 2016 ). Although additional discretionary contributions to the participants’ accounts under the Marriott International EDC may be made, no additional discretionary contributions were made for our employees in 2017 , 2016 and 2015 . Subsequent to the Spin-Off, we remain liable to reimburse Marriott International for distributions for participants that were employees of Marriott Vacations Worldwide at the time of the Spin-Off including earnings thereon. Since 2014, certain members of our senior management have had the opportunity to participate in the Marriott Vacations Worldwide Deferred Compensation Plan (the “Deferred Compensation Plan”), which we maintain and administer. Under the Deferred Compensation Plan, participating employees may defer payment and income taxation of a portion of their salary and bonus. It also gives participants the opportunity for long-term capital appreciation by crediting their accounts with notional earnings. Since the beginning of our 2017 fiscal year, participants in the Deferred Compensation Plan have been able to select a rate of return based on various market-based investment alternatives for a portion of their contributions, as well as any future Company contributions, to the Deferred Compensation Plan, and may also select such a rate for a portion of their existing account balances. To support our ability to meet a portion of our obligations under the Deferred Compensation Plan, we acquired company owned insurance policies (the “COLI policies”) on the lives of certain participants in the Deferred Compensation Plan, the proceeds of which are intended to be aligned with the investment alternatives elected by plan participants and are payable to a rabbi trust with the Company as grantor. For 2017, at least 25 percent of a participant’s contributions to the Deferred Compensation Plan was required to be subject to a fixed rate of return, which was 3.5 percent for 2017 and 5.6 percent for 2016 ; the rate was reduced in connection with the introduction of the market-based investment alternatives. For 2018, participants may select a rate of return based on market-based investment alternatives for up to 100 percent of their contributions and existing balances. We consolidate the liabilities of the Deferred Compensation Plan and the related assets, which consist of the COLI policies held in the rabbi trust. The rabbi trust is considered a variable interest entity (“VIE”). We are considered the primary beneficiary of the rabbi trust because we direct the activities of the trust and are the beneficiary of the trust. At December 31, 2017 , the value of the assets held in the rabbi trust was $13.7 million |
Property and Equipment | Property and Equipment Property and equipment includes our sales centers, golf courses, information technology and other assets used in the normal course of business, as well as undeveloped and partially developed land parcels that are not part of an approved development plan and do not meet the criteria to be classified as held for sale. In addition, fully developed vacation ownership interests are classified as property and equipment until they are registered for sale. We record property and equipment at cost, including interest and real estate taxes incurred during active development. We capitalize the cost of improvements that extend the useful life of property and equipment when incurred. These capitalized costs may include structural costs, equipment, fixtures, floor and decorative items and signage. We expense all repair and maintenance costs as incurred. We compute depreciation using the straight-line method over the estimated useful lives of the assets ( three to forty |
Cash and Cash Equivalents | Cash and Cash Equivalents We consider all highly liquid investments with an initial purchase maturity of three |
Restricted Cash | Restricted CashRestricted cash primarily consists of cash held in a reserve account related to vacation ownership notes receivable securitizations, cash collected for maintenance fees to be remitted to property owners’ associations, and deposits received, primarily associated with vacation ownership products and residential sales that are held in escrow until the associated contract has closed or the period in which it can be rescinded has passed, depending on legal requirements. |
Loan Loss Reserves | Loan Loss Reserves We record an estimate of expected uncollectibility on all notes receivable from vacation ownership purchasers as a reduction of revenues from the sale of vacation ownership products at the time we recognize profit on a vacation ownership product sale. We fully reserve for all defaulted vacation ownership notes receivable in addition to recording a reserve on the estimated uncollectible portion of the remaining vacation ownership notes receivable. For those vacation ownership notes receivable that are not in default, we assess collectibility based on pools of vacation ownership notes receivable because we hold large numbers of homogeneous vacation ownership notes receivable. We use the same criteria to estimate uncollectibility for non-securitized vacation ownership notes receivable and securitized vacation ownership notes receivable because they perform similarly. We estimate uncollectibility for each pool based on historical activity for similar vacation ownership notes receivable. Although we consider loans to owners to be past due if we do not receive payment within 30 days of the due date, we suspend accrual of interest only on those loans that are over 90 days past due. We consider loans over 150 days past due to be in default. We apply payments we receive for vacation ownership notes receivable on non-accrual status first to interest, then to principal and any remainder to fees. We resume accruing interest when vacation ownership notes receivable are less than 90 days past due. We do not accept payments for vacation ownership notes receivable during the foreclosure process unless the amount is sufficient to pay all past due principal, interest, fees and penalties owed and fully reinstate the note. We write off uncollectible vacation ownership notes receivable against the reserve once we receive title to the vacation ownership products through the foreclosure or deed-in-lieu process or, in Europe or Asia Pacific, when revocation is complete. For both non-securitized and securitized vacation ownership notes receivable, we estimated average remaining default rates of 7.16 percent and 7.09 percent as of December 31, 2017 and December 30, 2016 , respectively. A 0.5 percent age point increase in the estimated default rate would have resulted in an increase in our allowance for loan losses of $5.9 million and $5.0 million as of December 31, 2017 and December 30, 2016 , respectively. |
Variable Interest Entities | Variable Interest EntitiesIn accordance with the applicable accounting guidance for the consolidation of variable interest entities, we analyze our variable interests, including loans, guarantees and equity investments, to determine if an entity in which we have a variable interest is a variable interest entity. Our analysis includes both quantitative and qualitative reviews. We base our quantitative analysis on the forecasted cash flows of the entity, and our qualitative analysis on our review of the design of the entity, its organizational structure including decision-making ability, and relevant financial agreements. We also use our qualitative analyses to determine if we must consolidate a variable interest entity because we are its primary beneficiary. |
Costs Incurred to Sell Vacation Ownership Products | Costs Incurred to Sell Vacation Ownership Products We charge the majority of marketing and sales costs we incur to sell vacation ownership products to expense when incurred. Deferred marketing and selling expenses, which are direct marketing and selling costs related either to an unclosed contract or a contract for which 100 percent of revenue has not yet been recognized, were $6.0 million at year-end 2017 and $6.2 million at year-end 2016 |
Valuation of Property and Equipment | Valuation of Property and EquipmentProperty and equipment includes our sales centers, golf courses, operating properties, information technology and other assets used in the normal course of business, as well as undeveloped and partially developed land parcels that are not part of an approved development plan and do not meet the criteria to be classified as held for sale. We test long-lived asset groups for recoverability when changes in circumstances indicate the carrying value may not be recoverable, for example, when there are material adverse changes in projected revenues or expenses, significant underperformance relative to historical or projected operating results, or significant negative industry or economic trends. We evaluate recoverability of an asset group by comparing its carrying value to the future net undiscounted cash flows that we expect will be generated by the asset group. If the comparison indicates that the carrying value of an asset group is not recoverable, we recognize an impairment loss for the excess of carrying value over the estimated fair value. When we recognize an impairment loss for assets to be held and used, we depreciate the adjusted carrying amount of those assets over their remaining useful life. |
Fair Value Measurements | Fair Value Measurements We have few financial instruments that we must measure at fair value on a recurring basis. See Footnote No. 4, “Financial Instruments,” for further information. We also apply the provisions of fair value measurement to various non-recurring measurements for our financial and non-financial assets and liabilities. The applicable accounting standards define fair value as the price that would be received upon selling an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date (an exit price). We measure fair value of our assets and liabilities using inputs from the following three levels of the fair value hierarchy: Level 1 inputs are unadjusted quoted prices in active markets for identical assets or liabilities that we have the ability to access at the measurement date. Level 2 inputs include quoted prices for similar assets and liabilities in active markets, quoted prices for identical or similar assets or liabilities in markets that are not active, inputs other than quoted prices that are observable for the asset or liability (i.e., interest rates, yield curves, etc.), and inputs that are derived principally from or corroborated by observable market data by correlation or other means (market corroborated inputs). |
Derivative Instruments | Derivative Instruments From time to time, we may use derivative instruments to reduce market risk due to changes in interest rates and currency exchange rates, including interest rate derivatives that we may be required to enter into as a condition of our $250.0 million non-recourse warehouse credit facility (the “Warehouse Credit Facility”). As of December 31, 2017 , we were not party to any material derivative instruments or hedges. |
Non-U.S. Operations | Non-U.S. OperationsThe U.S. dollar is the functional currency of our consolidated entities operating in the United States. The functional currency for our consolidated entities operating outside of the United States is generally the currency of the economic environment in which the entity primarily generates and expends cash. For consolidated entities whose functional currency is not the U.S. dollar, we translate their financial statements into U.S. dollars. We translate assets and liabilities at the exchange rate in effect as of the financial statement date and translate Income Statement accounts using the weighted average exchange rate for the period. We include translation adjustments from currency exchange and the effect of exchange rate changes on intercompany transactions of a long-term investment nature as a separate component of equity. We report gains and losses from currency exchange rate changes related to intercompany receivables and payables that are not of a long-term investment nature, as well as gains and losses from non-U.S. currency transactions, currently in operating costs and expenses. |
Loss Contingencies | Loss ContingenciesWe are subject to various legal proceedings and claims in the normal course of business, the outcomes of which are subject to significant uncertainty. We record an accrual for loss contingencies when we determine that it is probable that a liability has been incurred and the amount of the loss can be reasonably estimated. In making such determinations we evaluate, among other things, the degree of probability of an unfavorable outcome and, when it is probable that a liability has been incurred, our ability to make a reasonable estimate of the loss. We review these accruals each reporting period and make revisions based on changes in facts and circumstances. |
Share-Based Compensation Costs | Share-Based Compensation Costs We established the Marriott Vacations Worldwide Corporation Stock and Cash Incentive Plan (the “Stock Plan”) in order to compensate our employees and directors by granting them equity awards such as restricted stock units (“RSUs”), stock appreciation rights (“SARs”) and stock options. We follow the provisions of ASC 718, “ Compensation—Stock Compensation, ” which requires that a company measure the expense of employee services received in exchange for an award of equity instruments based on the grant-date fair value of the award. Generally, share-based awards granted to our employees, other than RSUs with performance vesting conditions, vest ratably over a four -year period. For share-based awards with service-only vesting conditions, we record compensation expense on a straight-line basis over the requisite service period. For RSUs with performance vesting conditions, the number of RSUs earned, if any, is determined following the end of a three -year performance period based upon the cumulative achievement over that period of specific quantitative operating financial measures and we recognize compensation expense once it is probable that the corresponding performance condition will be achieved. SARs awarded under the Stock Plan are granted at exercise prices or strike prices equal to the market price of our common stock on the date of grant (this price is referred to as the “base value”). SARs generally expire ten years after the date of grant and both vest and become exercisable in cumulative installments of one quarter of the grant at the end of each of the first four years following the date of grant. Upon exercise of SARs, our employees and non-employee directors receive a number of shares of our common stock equal to the number of SARs being exercised, multiplied by the quotient of (a) the market price of the common stock on the date of exercise (this price is referred to as the “final value”) minus the base value, divided by (b) the final value. We recognize the expense associated with these awards on our Income Statements based on the fair value of the awards as of the date that the share-based awards are granted and adjust that expense to the estimated number of awards that we expect will vest or be earned. The fair value of RSUs represents the number of awards granted multiplied by the average of the high and low market price of our common stock on the date the awards are granted reduced by the present value of the dividends expected to be paid on the shares during the vesting period, discounted at a risk-free interest rate. We generally determine the fair value of SARs using the Black-Scholes option valuation model which incorporates assumptions about expected volatility, risk free interest rate, dividend yield and expected term. We will issue shares from authorized shares upon the exercise of SARs or stock options held by our employees and directors. |
Convertible Senior Notes | Convertible Senior Notes In accounting for the 1.50% |
Income Taxes | Income Taxes We file income tax returns, including with respect to our subsidiaries, in various jurisdictions around the world. We account for income taxes under the asset and liability method, which requires the recognition of deferred tax assets and liabilities for the expected future tax consequences of events that have been included in the financial statements. Under this method, deferred tax assets and liabilities are determined based on the differences between the financial statements and tax basis of assets and liabilities using enacted tax rates in effect for the year in which the differences are expected to reverse. The effect of a change in tax rates on deferred tax assets and liabilities is recognized in income in the period that includes the enactment date. Changes in existing tax laws and rates, their related interpretations, and the uncertainty generated by the current economic environment may affect the amounts of deferred tax liabilities or the valuations of deferred tax assets over time. Our accounting for deferred tax consequences represents management’s best estimate of future events that can be appropriately reflected in the accounting estimates. We record net deferred tax assets to the extent we believe these assets will more likely than not be realized. In making such a determination, we consider all available positive and negative evidence, including future reversals of existing taxable temporary differences, projected future taxable income, tax-planning strategies, and results of recent operations. In the event we determine that we would be able to realize our deferred income tax assets in the future in excess of their net recorded amount, we would make an adjustment to the deferred tax asset valuation allowance, which impacts the provision for income taxes. For tax positions we have taken, or expect to take, in a tax return we apply a more likely than not threshold, under which we must conclude a tax position is more likely than not to be sustained, assuming that the position will be examined by the appropriate taxing authority that has full knowledge of all relevant information, in order to continue to recognize the benefit. In determining our provision for income taxes, we use judgment, reflecting our estimates and assumptions, in applying the more likely than not threshold. We do not have any significant unrecognized tax benefits as of December, 31, 2017, December 30, 2016 or January 1, 2016, that, if recognized, would impact our effective tax rate for 2017, 2016 or 2015, respectively. We do not expect that our unrecognized tax benefits as of December 31, 2017 will change significantly within the next twelve months. Additionally, we recognize accrued interest and penalties related to our unrecognized tax benefits as a component of tax expense. |
Earnings Per Common Share | Earnings Per Common ShareBasic earnings per common share is calculated by dividing the earnings available to common shareholders by the weighted average number of common shares outstanding for the period. Diluted earnings per common share is calculated to give effect to all potentially dilutive common shares that were outstanding during the reporting period. The dilutive effect of outstanding equity-based compensation awards is reflected in diluted earnings per common share by application of the treasury stock methods. |
New Accounting Standards | New Accounting Standards Accounting Standards Update No. 2017-09 – “ Compensation – Stock Compensation (Topic 718): Scope of Modification Accounting ” (“ASU 2017-09”) In May 2017, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2017-09, which clarifies when changes to the terms or conditions of a share-based payment award must be accounted for as modifications for the purpose of applying the modification guidance in Accounting Standards Codification Topic 718. This update is effective for all entities for annual periods beginning after December 15, 2017, and for interim periods within those annual periods, with early adoption permitted. Our early adoption of ASU 2017-09 in the 2017 second quarter did not have an impact on our financial statements or disclosures. Accounting Standards Update No. 2016-18 – “ Restricted Cash ” (“ASU 2016-18”) In November 2016, the FASB issued ASU 2016-18, which requires entities to show the changes in the total of cash, cash equivalents, restricted cash and restricted cash equivalents in the statement of cash flows. As a result, we no longer present changes in restricted cash as a component of investing activities. This update is effective for public companies for fiscal years beginning after December 15, 2017, including interim periods within those fiscal years. We early adopted ASU 2016-18 on a retrospective basis commencing in the 2017 first quarter. Accounting Standards Update No. 2016-09 – “ Compensation – Stock Compensation (Topic 718) ” (“ASU 2016-09”) In March 2016, the FASB issued ASU 2016-09, which changes how entities account for certain aspects of share-based payment transactions, including the income tax consequences, classification of awards as either equity or liabilities and classification on the statement of cash flows. The new guidance requires all income tax effects of awards, including excess tax benefits, to be recorded as income tax expense (or benefit) in the income statement, which resulted in benefits to our provision for income taxes of $6.1 million in 2017. The new guidance requires excess tax benefits to be presented as an operating inflow rather than as a financing inflow in the statement of cash flows. Prior to the adoption of ASU 2016-09, excess tax benefits were recorded in additional paid-in-capital on the balance sheet. This update is effective for annual periods beginning after December 15, 2016 and interim periods within those annual periods. We adopted ASU 2016-09 in the 2017 first quarter. The adoption of ASU 2016-09 decreased our provision for income taxes, the amount of which depends on the vesting activity of our share-based compensation awards in any given period, and eliminated the presentation of excess tax benefits as a financing inflow on our statement of cash flows. Further, we made an accounting policy election to recognize forfeitures of share-based compensation awards as they occur, the cumulative effect of which resulted in an adjustment of $0.4 million to opening retained earnings. The adoption of ASU 2016-09 did not have any other material impacts on our financial statements or disclosures. |
Future Adoption of Accounting Standards | Future Adoption of Accounting Standards Accounting Standards Update No. 2017-12 – “ Derivatives and Hedging (Topic 815): Targeted Improvements to Accounting for Hedging Activities ” (“ASU 2017-12”) In August 2017, the FASB issued ASU 2017-12, which amends and simplifies existing guidance in order to allow companies to better portray the economic effects of risk management activities in their financial statements and enhance the transparency and understandability of the results of hedging activities. ASU 2017-12 eliminates the requirement to separately measure and report hedge ineffectiveness and generally requires the entire change in the fair value of a hedging instrument to be presented in the same income statement line as the hedged item. The guidance also eases certain documentation and assessment requirements. This update is effective for public companies for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years, with early adoption permitted. We are evaluating the impact that ASU 2017-12, including the timing of implementation, will have on our financial statements and disclosures. Accounting Standards Update No. 2016-16 – “ Income Taxes (Topic 740): Intra-Entity Transfers of Assets Other Than Inventory ” (“ASU 2016-16”) In October 2016, the FASB issued ASU 2016-16, which changes the timing of when certain intercompany transactions are recognized within the provision for income taxes. This update is effective for public companies for annual periods beginning after December 15, 2017, and for annual periods and interim periods thereafter, with early adoption permitted. We adopted ASU 2016-16 on January 1, 2018. We do not expect the adoption of ASU 2016-16 to have a material impact on our financial statements or disclosures. Accounting Standards Update No. 2016-13 – “ Financial Instruments – Credit Losses (Topic 326), Measurement of Credit Losses on Financial Instruments ” (“ASU 2016-13”) In June 2016, the FASB issued ASU 2016-13, which replaces the incurred loss impairment methodology in current GAAP with a methodology that reflects expected credit losses. The update is intended to provide financial statement users with more decision-useful information about the expected credit losses on financial instruments and other commitments to extend credit held by a reporting entity at each reporting date. This update is effective for fiscal years beginning after December 15, 2019, including interim periods within those fiscal years, with early adoption permitted for fiscal periods beginning after December 15, 2018. We are evaluating the impact that ASU 2016-13, including the timing of implementation, will have on our financial statements and disclosures. Accounting Standards Update No. 2016-02 – “ Leases (Topic 842) ” (“ASU 2016-02”) In February 2016, the FASB issued ASU 2016-02 to increase transparency and comparability of information regarding an entity’s leasing activities by providing additional information to users of financial statements. ASU 2016-02 amends the existing accounting standards for lease accounting, including requiring lessees to recognize most leases on their balance sheets and making targeted changes to lessor accounting. The new standard requires a modified retrospective transition approach for all leases existing at, or entered into after, the date of initial application, although an option to use transition relief to not restate or make required disclosures in comparative periods in the period of adoption was recently exposed by the FASB for public comment. ASU 2016-02 is effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years, with early adoption permitted. Although we expect to adopt ASU 2016-02 commencing in fiscal year 2019 and are continuing our implementation efforts, we continue to evaluate the impact that adoption of this update will have on our financial statements and disclosures, but we expect that it will have a material effect on our balance sheets. Accounting Standards Update No. 2016-01 – “ Financial Instruments – Overall (Subtopic 825-10) ” (“ASU 2016-01”) In January 2016, the FASB issued ASU 2016-01, which updates certain aspects of recognition, measurement, presentation and disclosure of financial instruments. For public business entities, the amendments in ASU 2016-01 will be effective for fiscal years beginning after December 15, 2017, including interim periods within those fiscal years. We do not expect the adoption of ASU 2016-01 to have a material impact on our financial statements. Accounting Standards Update No. 2014-09 – “ Revenue from Contracts with Customers (Topic 606) ” (“ASU 2014-09”), as Amended In May 2014, the FASB issued ASU 2014-09, which, as amended, creates ASC Topic 606, “ Revenue from Contracts with Customers, ” (“ASC 606”), and supersedes the revenue recognition requirements in ASC Topic 605, “ Revenue Recognition ”, including most industry-specific guidance, and significantly enhances comparability of revenue recognition practices across entities and industries by providing a principle-based, comprehensive framework for addressing revenue recognition issues. In order for a provider of promised goods or services to recognize as revenue the consideration that it expects to receive in exchange for the promised goods or services, the provider should apply the following five steps: (1) identify the contract with a customer; (2) identify the performance obligations in the contract; (3) determine the transaction price; (4) allocate the transaction price to the performance obligations in the contract; and (5) recognize revenue when (or as) |
SUMMARY OF SIGNIFICANT ACCOUN26
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Accounting Policies [Abstract] | |
Each Reference to Particular Year in These Financial Statements Means Fiscal Year Ended on Date Shown | Fiscal Year Fiscal Year-End Date Number of Days 2017 December 31, 2017 366 2016 December 30, 2016 364 2015 January 1, 2016 364 |
INCOME TAXES (Tables)
INCOME TAXES (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Income Tax Disclosure [Abstract] | |
Income (Loss) Before Provision for Income Taxes by Geographic Region | The components of our earnings before income taxes for the last three years consisted of: ($ in thousands) 2017 2016 2015 United States $ 217,348 $ 220,169 $ 197,519 Non-U.S. jurisdictions 8,535 2,759 8,978 $ 225,883 $ 222,928 $ 206,497 |
Provision for Income Taxes | Our benefit (provision) for income taxes for the last three years consisted of: ($ in thousands) 2017 2016 2015 Current – U.S. Federal $ (48,735 ) $ (35,715 ) $ (44,728 ) – U.S. State (7,370 ) (4,926 ) (4,027 ) – Non-U.S. (7,043 ) (4,902 ) (6,953 ) (63,148 ) (45,543 ) (55,708 ) Deferred – U.S. Federal 49,072 (38,332 ) (25,350 ) – U.S. State (279 ) (3,432 ) (4,554 ) – Non-U.S. 15,250 1,727 1,914 64,043 (40,037 ) (27,990 ) $ 895 $ (85,580 ) $ (83,698 ) |
Deferred Tax Assets and Liabilities | The following table presents our deferred tax assets and liabilities, and the tax effect of each type of temporary difference and carry-forward that gave rise to a significant portion of our deferred tax assets and liabilities at December 31, 2017 and December 30, 2016 : ($ in thousands) At Year-End 2017 At Year-End 2016 Deferred Tax Assets Inventory $ 24,814 $ 24,821 Reserves 29,854 38,677 Long lived intangible assets 15,746 31,464 Net operating loss carry-forwards 38,831 49,205 Tax credits 39,593 21,345 Other, net 53,397 52,263 Deferred tax assets 202,235 217,775 Less valuation allowance (43,987 ) (47,839 ) Net deferred tax assets 158,248 169,936 Deferred Tax Liabilities Property and equipment (16,360 ) (15,560 ) Deferred sales of vacation ownership interests (220,130 ) (296,600 ) Deferred tax liabilities (236,490 ) (312,160 ) Total net deferred tax liabilities $ (78,242 ) $ (142,224 ) |
Reconciliation of US Statutory Income Tax Rate to Effective Tax Rate | The following table reconciles the U.S. statutory income tax rate to our effective income tax rate: 2017 2016 2015 U.S. statutory income tax rate 35.00% 35.00% 35.00% U.S. state income taxes, net of U.S. federal tax benefit 2.42 2.47 2.62 Permanent differences (1) (0.65) 1.03 1.65 Impact related to the Tax Cuts and Jobs Act (28.86) — — Excess tax benefits related to share-based compensation (2.70) — — Foreign tax rate changes (2.11) 0.05 0.01 Non-U.S. income (loss) (2) (2.81) 0.09 (0.63) Other items (3) (0.76) (0.95) 1.22 Change in valuation allowance (4) 0.07 0.70 0.66 Effective rate (0.40%) 38.39% 40.53% _________________________ (1) Attributed to the redemption of the mandatorily redeemable preferred stock of a consolidated subsidiary. (2) Attributed to the difference between U.S. and foreign income tax rates and other foreign adjustments. (3) Attributed to changes in unrecognized tax benefits and U.S. federal tax incentives. (4) |
VACATION OWNERSHIP NOTES RECE28
VACATION OWNERSHIP NOTES RECEIVABLE (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Receivables [Abstract] | |
Composition of Vacation Ownership Notes Receivable Balances, Net of Reserves | The following table shows the composition of our vacation ownership notes receivable balances, net of reserves: ($ in thousands) At Year-End 2017 At Year-End 2016 Vacation ownership notes receivable — securitized $ 815,331 $ 717,543 Vacation ownership notes receivable — non-securitized Eligible for securitization (1) 142,269 98,508 Not eligible for securitization (1) 162,031 156,260 Subtotal 304,300 254,768 Total vacation ownership notes receivable $ 1,119,631 $ 972,311 _________________________ (1) |
Future Principal Payments, Net of Reserves, and Interest Rates of Vacation Ownership Notes Receivable | The following tables show future principal payments, net of reserves, as well as interest rates for our non-securitized and securitized vacation ownership notes receivable at December 31, 2017 : ($ in thousands) Non-Securitized Vacation Ownership Notes Receivable Securitized Vacation Ownership Notes Receivable Total 2018 $ 48,846 $ 94,079 $ 142,925 2019 35,253 90,719 125,972 2020 30,567 92,089 122,656 2021 26,127 93,351 119,478 2022 23,953 92,191 116,144 Thereafter 139,554 352,902 492,456 Balance at year-end 2017 $ 304,300 $ 815,331 $ 1,119,631 Weighted average stated interest rate at year-end 2017 11.5% 12.6% 12.3% Range of stated interest rates at year-end 2017 0.0% to 18.0% 4.9% to 18.0% 0.0% to 18.0% |
Interest Income Associated with Vacation Ownership Notes Receivable | The following table summarizes interest income associated with vacation ownership notes receivable: ($ in thousands) 2017 2016 2015 Interest income associated with vacation ownership notes receivable – securitized $ 101,193 $ 96,606 $ 89,693 Interest income associated with vacation ownership notes receivable – non-securitized 26,790 23,507 28,327 Total interest income associated with vacation ownership notes receivable $ 127,983 $ 120,113 $ 118,020 |
Notes Receivable Reserves | The following table summarizes the activity related to our vacation ownership notes receivable reserve for 2017, 2016 and 2015: ($ in thousands) Non-Securitized Securitized Total Balance at year-end 2014 $ 64,752 $ 53,666 $ 118,418 Provision for loan losses 23,832 9,209 33,041 Securitizations (16,491 ) 16,491 — Clean-up calls (1) 7,115 (7,115 ) — Write-offs (48,220 ) — (48,220 ) Defaulted vacation ownership notes receivable repurchase activity (2) 24,596 (24,596 ) — Balance at year-end 2015 55,584 47,655 103,239 Provision for loan losses 28,652 18,505 47,157 Securitizations (28,322 ) 28,322 — Clean-up of Warehouse Credit Facility (3) 10,496 (10,496 ) — Write-offs (40,033 ) — (40,033 ) Defaulted vacation ownership notes receivable repurchase activity (2) 30,251 (30,251 ) — Balance at year-end 2016 56,628 53,735 110,363 Provision for loan losses 41,531 9,021 50,552 Securitizations (29,071 ) 29,071 — Clean-up of Warehouse Credit Facility (3) 3,995 (3,995 ) — Write-offs (45,257 ) — (45,257 ) Defaulted vacation ownership notes receivable repurchase activity (2) 28,324 (28,324 ) — Balance at year-end 2017 $ 56,150 $ 59,508 $ 115,658 _________________________ (1) Refers to our voluntary repurchase of previously securitized non-defaulted vacation ownership notes receivable to retire outstanding vacation ownership notes receivable securitizations. (2) Decrease in securitized vacation ownership notes receivable reserve and increase in non-securitized vacation ownership notes receivable reserve was attributable to the transfer of the reserve when we voluntarily repurchased defaulted securitized vacation ownership notes receivable. (3) |
Recorded Investment in Non-accrual Notes Receivable that are 90 Days or More Past Due | The following table shows our recorded investment in non-accrual vacation ownership notes receivable, which are vacation ownership notes receivable that are 90 days or more past due. As noted in Footnote No. 1, “Summary of Significant Accounting Policies,” we recognize interest income on a cash basis for these vacation ownership notes receivable. ($ in thousands) Non-Securitized Vacation Ownership Notes Receivable Securitized Vacation Ownership Notes Receivable Total Investment in vacation ownership notes receivable on non-accrual status at year-end 2017 $ 38,786 $ 7,428 $ 46,214 Investment in vacation ownership notes receivable on non-accrual status at year-end 2016 $ 43,792 $ 6,687 $ 50,479 Average investment in vacation ownership notes receivable on non-accrual status during 2017 $ 41,289 $ 7,058 $ 48,347 |
Aging of Recorded Investment in Principal, Before Reserves, in Vacation Ownership Notes Receivable | The following table shows the aging of the recorded investment in principal, before reserves, in vacation ownership notes receivable as of December 31, 2017 : ($ in thousands) Non-Securitized Vacation Ownership Notes Receivable Securitized Vacation Ownership Notes Receivable Total 31 – 90 days past due $ 7,109 $ 18,553 $ 25,662 91 – 150 days past due 4,341 7,428 11,769 Greater than 150 days past due 34,445 — 34,445 Total past due 45,895 25,981 71,876 Current 314,555 848,858 1,163,413 Total vacation ownership notes receivable $ 360,450 $ 874,839 $ 1,235,289 The following table shows the aging of the recorded investment in principal, before reserves, in vacation ownership notes receivable as of December 30, 2016 : ($ in thousands) Non-Securitized Securitized Total 31 – 90 days past due $ 7,780 $ 16,468 $ 24,248 91 – 150 days past due 3,981 6,687 10,668 Greater than 150 days past due 39,811 — 39,811 Total past due 51,572 23,155 74,727 Current 259,824 748,123 1,007,947 Total vacation ownership notes receivable $ 311,396 $ 771,278 $ 1,082,674 |
FINANCIAL INSTRUMENTS (Tables)
FINANCIAL INSTRUMENTS (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Investments, All Other Investments [Abstract] | |
Carrying Values and Estimated Fair Values of Financial Assets and Liabilities | The following table shows the bifurcation of our non-securitized vacation ownership notes receivable into those eligible and not eligible for securitization based upon the aforementioned eligibility criteria: At Year-End 2017 At Year-End 2016 ($ in thousands) Carrying Amount Fair Carrying Amount Fair Vacation ownership notes receivable Eligible for securitization $ 142,269 $ 162,630 $ 98,508 $ 112,901 Not eligible for securitization 162,031 162,031 156,260 156,260 Total non-securitized $ 304,300 $ 324,661 $ 254,768 $ 269,161 At Year-End 2017 At Year-End 2016 ($ in thousands) Carrying Fair (1) Carrying Fair (1) Vacation ownership notes receivable — securitized $ 815,331 $ 956,292 $ 717,543 $ 834,009 Vacation ownership notes receivable — non-securitized 304,300 324,661 254,768 269,161 Other assets 13,708 13,708 — — Total financial assets $ 1,133,339 $ 1,294,661 $ 972,311 $ 1,103,170 Non-recourse debt associated with vacation ownership notes receivable securitizations, net $ (834,889 ) $ (836,028 ) $ (729,188 ) $ (725,963 ) Convertible notes, net (192,518 ) (259,884 ) — — Non-interest bearing note payable, net (60,560 ) (60,560 ) — — Total financial liabilities $ (1,087,967 ) $ (1,156,472 ) $ (729,188 ) $ (725,963 ) _________________________ (1) Fair value of financial instruments with the exception of other assets and convertible notes, has been determined using Level 3 inputs. Fair value of other assets and convertible notes that are financial instruments has been determined using Level 2 inputs. |
EARNINGS PER SHARE (Tables)
EARNINGS PER SHARE (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Earnings Per Share [Abstract] | |
Reconciliation of Earnings and Number of Shares Used in Calculation of Basic and Diluted Earnings Per Share | The table below illustrates the reconciliation of the earnings and number of shares used in our calculation of basic and diluted earnings per share. (in thousands, except per share amounts) 2017 (1) 2016 (2) 2015 (3) Computation of Basic Earnings Per Share Net income $ 226,778 $ 137,348 $ 122,799 Shares for basic earnings per share 27,078 27,882 31,487 Basic earnings per share $ 8.38 $ 4.93 $ 3.90 Computation of Diluted Earnings Per Share Net income $ 226,778 $ 137,348 $ 122,799 Shares for basic earnings per share 27,078 27,882 31,487 Effect of dilutive shares outstanding Employee stock options and SARs 438 367 446 Restricted stock units 217 173 235 Shares for diluted earnings per share 27,733 28,422 32,168 Diluted earnings per share $ 8.18 $ 4.83 $ 3.82 _________________________ (1) The computations of diluted earnings per share exclude approximately 238,000 shares of common stock, the maximum number of shares issuable as of December 31, 2017 upon the vesting of certain performance-based awards, because the performance conditions required to be met for the shares subject to such awards to vest were not achieved by the end of the reporting period. (2) The computations of diluted earnings per share exclude approximately 217,000 shares of common stock, the maximum number of shares issuable as of December 30, 2016 upon the vesting of certain performance-based awards, because the performance conditions required to be met for the shares subject to such awards to vest were not achieved by the end of the reporting period. (3) The computations of diluted earnings per share exclude approximately 136,000 shares of common stock, the maximum number of shares issuable as of January 1, 2016 |
INVENTORY (Tables)
INVENTORY (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Inventory Disclosure [Abstract] | |
Composition of Inventory | The following table shows the composition of our inventory balances: ($ in thousands) At Year-End 2017 At Year End 2016 Finished goods (1) $ 379,194 $ 337,949 Work-in-progress 2,315 39,486 Land and infrastructure (2) 330,002 330,728 Real estate inventory 711,511 708,163 Operating supplies and retail inventory 5,022 4,373 $ 716,533 $ 712,536 _________________________ (1) Represents completed inventory that is either registered for sale as vacation ownership interests, or unregistered and available for sale in its current form. (2) Includes $67.6 million of inventory related to estimated future foreclosures at December 31, 2017 |
PROPERTY AND EQUIPMENT (Tables)
PROPERTY AND EQUIPMENT (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Property, Plant and Equipment [Abstract] | |
Composition of Property and Equipment | The following table details the composition of our property and equipment balances: ($ in thousands) At Year-End 2017 At Year-End 2016 Land $ 60,174 $ 54,975 Buildings and leasehold improvements 258,919 213,190 Furniture and equipment 54,394 51,053 Information technology 184,635 180,075 Construction in progress 22,877 27,493 580,999 526,786 Accumulated depreciation (328,272 ) (323,984 ) $ 252,727 $ 202,802 |
CONTINGENCIES AND COMMITMENTS (
CONTINGENCIES AND COMMITMENTS (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Commitments and Contingencies Disclosure [Abstract] | |
Summary of Future Obligations Under Operating Leases | We have summarized our future obligations under operating leases at December 31, 2017 below: ($ in thousands) Land Corporate Other Total 2018 $ 1,157 $ 3,628 $ 12,666 $ 17,451 2019 1,157 3,739 9,636 14,532 2020 1,157 3,850 7,710 12,717 2021 1,157 2,646 5,621 9,424 2022 1,157 — 5,455 6,612 Thereafter 6,939 — 28,547 35,486 Total minimum lease payments $ 12,724 $ 13,863 $ 69,635 $ 96,222 |
Composition of Rental Expense Associated with Operating Leases | The following table details the composition of rent expense associated with operating leases, net of sublease income, for the last three years: ($ in thousands) 2017 2016 2015 Minimum rentals $ 9,390 $ 8,639 $ 9,401 Additional rentals 3,905 3,845 3,876 $ 13,295 $ 12,484 $ 13,277 |
DEBT (Tables)
DEBT (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Debt Disclosure [Abstract] | |
Debt Balances, Net of Unamortized Debt Issuance Costs | The following table provides detail on our debt balances, net of unamortized debt discount and issuance costs: ($ in thousands) At Year-End 2017 At Year-End 2016 Vacation ownership notes receivable securitizations, gross (1) $ 845,131 $ 738,362 Unamortized debt issuance costs (10,242 ) (9,174 ) 834,889 729,188 Convertible notes, gross (2) 230,000 — Unamortized debt discount and issuance costs (37,482 ) — 192,518 — Non-interest bearing note payable 63,558 — Unamortized debt discount (3) (2,998 ) — 60,560 — Other debt, gross 27 834 Unamortized debt issuance costs (2 ) (19 ) 25 815 Capital leases 7,221 7,221 $ 1,095,213 $ 737,224 _________________________ (1) Interest rates as of December 31, 2017 range from 2.2% to 6.3% with a weighted average interest rate of 2.5% . (2) The effective interest rate as of December 31, 2017 was 4.7% . (3) Debt discount based on imputed interest rate of 6.0% . |
Scheduled Future Principal Payments for Debt | The following table shows scheduled future principal payments for our debt as of December 31, 2017 : ($ in thousands) Vacation Ownership Notes Receivable Securitizations (1) Convertible Notes Non-Interest Bearing Note Payable Other Debt Capital Leases Total Debt Principal Payments Year 2018 $ 95,768 $ — $ 32,680 $ — $ — $ 128,448 2019 92,273 — 30,878 — 7,221 130,372 2020 93,553 — — — — 93,553 2021 94,503 — — — — 94,503 2022 93,808 230,000 — — — 323,808 Thereafter 375,226 — — 27 — 375,253 $ 845,131 $ 230,000 $ 63,558 $ 27 $ 7,221 $ 1,145,937 _________________________ (1) |
Convertible Debt | The following table shows the net carrying value of the Convertible Notes at December 31, 2017 : ($ in thousands) Liability component Principal amount $ 230,000 Unamortized debt discount (31,596 ) Unamortized debt issuance costs (5,886 ) $ 192,518 Equity component, net of issuance costs $ 32,573 The following table shows the total interest expense related to the Convertible Notes for the year ended December 31, 2017 : ($ in thousands) Contractual interest expense $ 920 Amortization of debt discount 1,629 Amortization of debt issuance costs 325 $ 2,874 |
SHAREHOLDERS' EQUITY (Tables)
SHAREHOLDERS' EQUITY (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Equity [Abstract] | |
Stock Repurchase Activity under Current Stock Repurchase Program | The following table summarizes share repurchase activity under our current share repurchase program: ($ in thousands, except per share amounts) Number of Cost of Shares Average Price As of December 30, 2016 9,672,629 $ 608,439 $ 62.90 For the year ended December 31, 2017 767,876 88,305 115.00 As of December 31, 2017 10,440,505 $ 696,744 $ 66.73 |
Cash Dividend Declared | We declared cash dividends to holders of common stock during the year ended December 31, 2017 as follows: Declaration Date Shareholder Record Date Distribution Date Dividend per Share February 9, 2017 February 23, 2017 March 9, 2017 $0.35 May 11, 2017 May 25, 2017 June 8, 2017 $0.35 September 7, 2017 September 21, 2017 October 5, 2017 $0.35 December 7, 2017 December 21, 2017 January 4, 2018 $0.40 |
SHARE-BASED COMPENSATION (Table
SHARE-BASED COMPENSATION (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Schedule of Compensation Cost for Share-based Payment | The following table details our share-based compensation expense related to award grants to our officers, directors and employees: ($ in thousands) 2017 2016 2015 Service based RSUs $ 10,147 $ 9,372 $ 8,879 Performance based RSUs 3,752 2,502 3,343 13,899 11,874 12,222 SARs 2,387 2,075 1,920 Stock options — — — $ 16,286 $ 13,949 $ 14,142 |
Schedule of Unrecognized Compensation Cost | The following table details our deferred compensation costs related to unvested awards: ($ in thousands) At Year-End 2017 (1) At Year-End 2016 Service based RSUs $ 8,918 $ 9,000 Performance based RSUs 4,752 3,307 13,670 12,307 SARs 999 1,146 Stock options — — $ 14,669 $ 13,453 _________________________ (1) As of December 31, 2017 , the weighted average remaining term for RSU grants outstanding at year-end 2017 was 1.8 years and we expect that deferred compensation expense will be recognized over a weighted average period of 2.4 |
Additional Information on Outstanding RSUs Issued to Employees | The following table shows the changes in our outstanding RSUs and the associated weighted average grant-date fair values: 2017 Service Based Performance Based Total Number of RSUs Weighted Average Grant-Date Fair Value Per RSU Number of RSUs Weighted Average Grant-Date Fair Value Per RSU Number of RSUs Weighted Average Grant-Date Fair Value Per RSU Outstanding at year-end 2016 514,947 $ 49.36 279,284 $ 61.30 794,231 $ 53.56 Granted 115,334 $ 96.53 94,436 $ 93.41 209,770 $ 95.12 Distributed (152,783) $ 51.88 (50,978) $ 52.09 (203,761) $ 51.93 Forfeited (6,491) $ 74.47 (11,230) $ 52.09 (17,721) $ 60.28 Outstanding at year-end 2017 471,007 $ 59.49 311,512 $ 72.89 782,519 $ 64.83 |
Changes in Outstanding Marriott Vacations Worldwide SARs Issued to Both Marriott International and Marriott Vacations Worldwide Employees and Non-employee Directors | The following table shows the changes in our outstanding SARs and the associated weighted average exercise prices: 2017 Number of Weighted Average Exercise Price Per SAR Outstanding at year-end 2016 781,903 $ 34.97 Granted 81,977 97.53 Exercised (205,427) 19.35 Forfeited or expired — — Outstanding at year-end 2017 (1)(2) 658,453 $ 47.63 _________________________ (1) As of December 31, 2017 , outstanding SARs had a total intrinsic value of $ 58.3 million and a weighted average remaining term of 5.9 years. (2) As of December 31, 2017 , 431,543 SARs with a weighted average exercise price of $ 32.62 , an aggregate intrinsic value of $ 44.7 million and a weighted average remaining contractual term of 4.6 |
Assumptions Used to Estimate Fair Value of Grants | The following table outlines the assumptions used to estimate the fair value of grants in 2017, 2016 and 2015: 2017 2016 2015 Expected volatility 30.41% 31.60% 42.74% Dividend yield 1.44% 1.96% 1.26% Risk-free rate 2.06% 1.41% 1.74% Expected term (in years) 6.25 6.25 6.25 |
VARIABLE INTEREST ENTITIES (Tab
VARIABLE INTEREST ENTITIES (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Interest Income and Interest Expense Disclosure [Table Text Block] | The following table shows the interest income and expense recognized as a result of our involvement with these variable interest entities during 2017 : ($ in thousands) Vacation Ownership Warehouse Total Interest income $ 98,862 $ 2,331 $ 101,193 Interest expense to investors $ 18,872 $ 1,676 $ 20,548 Debt issuance cost amortization $ 3,731 $ 938 $ 4,669 Administrative expenses $ 409 $ 153 $ 562 |
Classifications of Consolidated Variable Interest Entities | The following table shows consolidated assets, which are collateral for the obligations of these variable interest entities, and consolidated liabilities included on our Balance Sheet at December 31, 2017 : ($ in thousands) Vacation Ownership Warehouse Total Consolidated Assets Vacation ownership notes receivable, net of reserves $ 815,331 $ — $ 815,331 Interest receivable 5,639 — 5,639 Restricted cash 32,317 4 32,321 Total $ 853,287 $ 4 $ 853,291 Consolidated Liabilities Interest payable $ 651 $ 50 $ 701 Debt 845,131 — 845,131 Total $ 845,782 $ 50 $ 845,832 |
Cash Flows Between Company and Variable Interest Entities | The following table shows cash flows between us and the vacation ownership notes receivable securitization variable interest entities: ($ in thousands) 2017 2016 Cash Inflows Net proceeds from vacation ownership notes receivable securitizations $ 346,469 $ 247,453 Principal receipts 228,723 174,830 Interest receipts 99,766 91,972 Reserve release 757 50,733 Total 675,715 564,988 Cash Outflows Principal to investors (214,907 ) (166,652 ) Voluntary repurchases of defaulted vacation ownership notes receivable (28,324 ) (29,590 ) Interest to investors (18,630 ) (17,449 ) Funding of restricted cash (1,804 ) (51,770 ) Total (263,665 ) (265,461 ) Net Cash Flows $ 412,050 $ 299,527 The following table shows cash flows between us and the Warehouse Credit Facility variable interest entity: ($ in thousands) 2017 2016 Cash Inflows Proceeds from vacation ownership notes receivable securitizations $ 50,260 $ 126,622 Principal receipts 1,403 5,227 Interest receipts 2,093 5,048 Reserve release 296 909 Total 54,052 137,806 Cash Outflows Principal to investors (1,160 ) (3,771 ) Voluntary repurchases of defaulted vacation ownership notes receivable — (661 ) Repayment of Warehouse Credit Facility (49,100 ) (122,190 ) Interest to investors (1,672 ) (1,796 ) Funding of restricted cash (296 ) (447 ) Total (52,228 ) (128,865 ) Net Cash Flows $ 1,824 $ 8,941 |
BUSINESS SEGMENTS (Tables)
BUSINESS SEGMENTS (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Segment Reporting [Abstract] | |
Revenues | Revenues ($ in thousands) 2017 2016 (1) 2015 (1) North America $ 1,777,345 $ 1,627,916 $ 1,605,102 Asia Pacific 67,773 74,949 93,632 Europe 106,827 105,621 112,061 Total segment revenues 1,951,945 1,808,486 1,810,795 Corporate and other — — — $ 1,951,945 $ 1,808,486 $ 1,810,795 _________________________ (1) |
Net Income | Net Income ($ in thousands) 2017 2016 (1) 2015 (1) North America $ 427,873 $ 423,334 $ 409,596 Asia Pacific (968 ) 1,278 7,263 Europe 14,678 12,067 13,874 Total segment financial results 441,583 436,679 430,733 Corporate and other (215,700 ) (213,751 ) (224,236 ) Benefit (provision) for income taxes 895 (85,580 ) (83,698 ) $ 226,778 $ 137,348 $ 122,799 _________________________ (1) |
Depreciation | Depreciation ($ in thousands) 2017 2016 2015 North America $ 12,869 $ 12,046 $ 12,935 Asia Pacific 880 1,235 2,424 Europe 1,308 1,462 1,601 Total segment depreciation 15,057 14,743 16,960 Corporate and other 6,437 6,301 5,257 $ 21,494 $ 21,044 $ 22,217 |
Assets | Assets ($ in thousands) At Year-End 2017 At Year-End 2016 North America $ 2,143,664 $ 1,968,021 Asia Pacific 134,939 102,348 Europe 64,535 62,245 Total segment assets 2,343,138 2,132,614 Corporate and other 563,055 258,805 $ 2,906,193 $ 2,391,419 |
Capital Expenditures (including inventory) | Capital Expenditures (including inventory) ($ in thousands) 2017 2016 2015 North America $ 142,897 $ 136,889 $ 179,696 Asia Pacific 26,475 21,276 72,097 Europe 5,047 6,153 2,807 Total segment capital expenditures 174,419 164,318 254,600 Corporate and other 7,068 8,412 10,260 $ 181,487 $ 172,730 $ 264,860 |
QUARTERLY RESULTS (UNAUDITED) (
QUARTERLY RESULTS (UNAUDITED) (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Quarterly Financial Information Disclosure [Abstract] | |
Schedule of Quarterly Financial Information | 2017 (1)(2) ($ in thousands, except per share data) First Second Third Fourth Fiscal Revenues $ 486,119 $ 497,620 $ 486,990 $ 481,216 $ 1,951,945 Expenses $ (432,555 ) $ (430,204 ) $ (428,300 ) $ (429,604 ) $ (1,720,663 ) Net income $ 33,700 $ 44,276 $ 40,762 $ 108,040 $ 226,778 Basic earnings per share $ 1.24 $ 1.62 $ 1.50 $ 4.05 $ 8.38 Diluted earnings per share $ 1.21 $ 1.58 $ 1.47 $ 3.95 $ 8.18 2016 (2)(3)(4) ($ in thousands, except per share data) First Second Third Fourth Fiscal Revenues $ 419,122 $ 423,171 $ 401,637 $ 564,556 $ 1,808,486 Expenses $ (374,440 ) $ (368,674 ) $ (358,906 ) $ (481,195 ) $ (1,583,215 ) Net income $ 24,408 $ 36,309 $ 26,807 $ 49,824 $ 137,348 Basic earnings per share $ 0.84 $ 1.28 $ 0.99 $ 1.83 $ 4.93 Diluted earnings per share $ 0.82 $ 1.26 $ 0.97 $ 1.80 $ 4.83 _______________________ (1) Beginning with our 2017 fiscal year, we changed our financial reporting cycle to a calendar year-end and end-of-month quarterly reporting cycle. Accordingly our 2017 first quarter included the period from December 31, 2016 (the day after the end of the 2016 fiscal year) through March 31, 2017, and our 2017 second, third and fourth quarters included the three month periods ended June 30, September 30, and December 31, respectively. (2) The sum of the earnings per share for the four quarters differs from annual earnings per share due to the required method of computing the weighted average shares in interim periods. (3) The 2016 quarters consisted of 12 weeks, except for the fourth quarter of 2016, which consisted of 16 weeks. (4) |
ADOPTION OF ASC 606 EFFECTIVE40
ADOPTION OF ASC 606 EFFECTIVE JANUARY 1, 2018 (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Accounting Changes and Error Corrections [Abstract] | |
Schedule of New Accounting Pronouncements and Changes in Accounting Principles | 2017 ($ in thousands, except per share amounts) As Reported Adjustments As Adjusted REVENUES Sale of vacation ownership products $ 727,940 $ 29,498 $ 757,438 Resort management and other services 306,196 (27,358 ) 278,838 Financing 134,906 — 134,906 Rental 322,902 (60,863 ) 262,039 Cost reimbursements 460,001 289,601 749,602 TOTAL REVENUES 1,951,945 230,878 2,182,823 EXPENSES Cost of vacation ownership products 177,813 17,034 194,847 Marketing and sales 408,715 (13,825 ) 394,890 Resort management and other services 172,137 (17,913 ) 154,224 Financing 17,951 — 17,951 Rental 281,352 (57,970 ) 223,382 General and administrative 110,225 — 110,225 Litigation settlement 4,231 — 4,231 Consumer financing interest 25,217 — 25,217 Royalty fee 63,021 — 63,021 Cost reimbursements 460,001 289,601 749,602 TOTAL EXPENSES 1,720,663 216,927 1,937,590 Gains and other income, net 5,772 — 5,772 Interest expense (9,572 ) — (9,572 ) Other (1,599 ) — (1,599 ) INCOME BEFORE INCOME TAXES 225,883 13,951 239,834 Benefit (provision) for income taxes 895 (5,405 ) (4,510 ) NET INCOME $ 226,778 $ 8,546 $ 235,324 EARNINGS PER SHARE Earnings per share - Basic $ 8.38 $ 0.32 $ 8.70 Earnings per share - Diluted $ 8.18 $ 0.31 $ 8.49 2016 ($ in thousands, except per share amounts) As Reported Adjustments As Adjusted REVENUES Sale of vacation ownership products $ 637,503 $ (15,078 ) $ 622,425 Resort management and other services 300,821 (23,285 ) 277,536 Financing 126,126 881 127,007 Rental 312,071 (59,707 ) 252,364 Cost reimbursements 431,965 288,507 720,472 TOTAL REVENUES 1,808,486 191,318 1,999,804 EXPENSES Cost of vacation ownership products 155,093 7,850 162,943 Marketing and sales 353,295 (13,682 ) 339,613 Resort management and other services 174,311 (17,576 ) 156,735 Financing 18,631 135 18,766 Rental 260,752 (49,186 ) 211,566 General and administrative 104,833 — 104,833 Litigation settlement (303 ) — (303 ) Consumer financing interest 23,685 — 23,685 Royalty fee 60,953 — 60,953 Cost reimbursements 431,965 288,507 720,472 TOTAL EXPENSES 1,583,215 216,048 1,799,263 Gains and other income, net 11,201 — 11,201 Interest expense (8,912 ) — (8,912 ) Other (4,632 ) — (4,632 ) INCOME BEFORE INCOME TAXES 222,928 (24,730 ) 198,198 (Provision) benefit for income taxes (85,580 ) 9,320 (76,260 ) NET INCOME $ 137,348 $ (15,410 ) $ 121,938 EARNINGS PER SHARE Earnings per share - Basic $ 4.93 $ (0.56 ) $ 4.37 Earnings per share - Diluted $ 4.83 $ (0.54 ) $ 4.29 |
SUMMARY OF SIGNIFICANT ACCOUN41
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Business and Fiscal Period (Details) | 12 Months Ended | ||
Dec. 31, 2017LocationPropertyLineSegment | Dec. 30, 2016 | Jan. 01, 2016 | |
Significant Accounting Policies [Line Items] | |||
Number of business segments | Segment | 3 | ||
Number of primary sources of revenues generated | Line | 4 | ||
Percent of the assets, liabilities, revenues, expenses and cash flows discussed | 100.00% | ||
Additional days in reporting period | 2 days | ||
Fiscal period duration | 366 days | 364 days | 364 days |
Minimum | |||
Significant Accounting Policies [Line Items] | |||
Number of properties | Property | 65 | ||
Operations located outside the United States | |||
Significant Accounting Policies [Line Items] | |||
Number of countries and territories in which company operates | Location | 9 |
SUMMARY OF SIGNIFICANT ACCOUN42
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Revenue Recognition (Details) $ in Millions | 12 Months Ended | ||
Dec. 31, 2017USD ($)Segment | Dec. 30, 2016USD ($) | Jan. 01, 2016USD ($) | |
Accounting Policies [Abstract] | |||
Number of business segments | Segment | 3 | ||
Significant Accounting Policies [Line Items] | |||
Management fee revenues | $ 87.8 | $ 83.3 | $ 77.6 |
Contractual financing term | 10 years | ||
Minimum | |||
Significant Accounting Policies [Line Items] | |||
Financing Revenue payment commencement | 30 days | ||
Maximum | |||
Significant Accounting Policies [Line Items] | |||
Financing Revenue payment commencement | 60 days | ||
Resort management and other services | |||
Significant Accounting Policies [Line Items] | |||
Ancillary revenues | $ 118.2 | 124.2 | 125.2 |
Fee revenues | 79 | 75.7 | 72.4 |
Financings | |||
Significant Accounting Policies [Line Items] | |||
Fee revenues | $ 6.9 | $ 6 | $ 6 |
SUMMARY OF SIGNIFICANT ACCOUN43
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Inventory and Capitalized Costs (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 30, 2016 | Jan. 01, 2016 | |
Accounting Policies [Abstract] | |||
Increase in carrying value of inventories | $ 0.3 | $ 14.8 | $ 7.3 |
Capitalized salaries and related costs | $ 5.7 | $ 6.1 | $ 7.1 |
SUMMARY OF SIGNIFICANT ACCOUN44
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Defined Contribution Plan and Deferred Compensation Plan (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 30, 2016 | Jan. 01, 2016 | |
Accounting Policies [Abstract] | |||
Defined Contribution Plan, Cost | $ 9,700,000 | $ 8,000,000 | $ 7,100,000 |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Cash surrender value of life insurance | $ 13,700,000 | ||
EDC | Marriott International | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Annual rate of return | 4.00% | 4.50% | |
Additional discretionary contributions | $ 0 | ||
Deferred Compensation Plan | Stock options | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Annual rate of return | 3.50% | 5.60% | |
Minimum required fixed rate of return (at least) | 25.00% |
SUMMARY OF SIGNIFICANT ACCOUN45
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Property and Equipment (Details) | 12 Months Ended |
Dec. 31, 2017 | |
Minimum | |
Property, Plant and Equipment [Line Items] | |
Estimated useful lives of the assets | 3 years |
Maximum | |
Property, Plant and Equipment [Line Items] | |
Estimated useful lives of the assets | 40 years |
SUMMARY OF SIGNIFICANT ACCOUN46
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Cash and Cash Equivalents, Restricted Cash (Details) | 12 Months Ended |
Dec. 31, 2017 | |
Maximum | |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |
Highly liquid investments maturity period | 3 months |
SUMMARY OF SIGNIFICANT ACCOUN47
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Loan Loss Reserves and Costs Incurred to Sell Vacation Ownership Products (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2017 | Dec. 30, 2016 | |
Condensed Balance Sheet Statements, Captions [Line Items] | ||
Period in which loan considered past due | 30 days | |
Period in which loan suspend accrual of interest | 90 days | |
Period in which loan considered default loan | 150 days | |
Notes receivable estimated average remaining default rates | 7.16% | 7.09% |
Estimated default rate increases that would have resulted an increase in allowance for credit losses | 0.50% | |
Financing receivable, allowance for credit losses, that would have been increased | $ 5.9 | $ 5 |
Other assets | ||
Condensed Balance Sheet Statements, Captions [Line Items] | ||
Deferred marketing and selling expenses, which are direct marketing and selling costs related either to an unclosed contract or a contract for which 100 percent of revenue has not yet been recognized | $ 6 | $ 6.2 |
SUMMARY OF SIGNIFICANT ACCOUN48
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Fair Value Measurements and Derivative Instruments (Details) | Dec. 31, 2017USD ($) |
Warehouse Credit Facility | |
Debt Instrument [Line Items] | |
Line of credit facility, maximum borrowing capacity | $ 250,000,000 |
SUMMARY OF SIGNIFICANT ACCOUN49
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Share-Based Compensation Costs (Details) | 12 Months Ended |
Dec. 31, 2017 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Stock awards, vesting period | 4 years |
Performance based RSUs | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Stock awards, vesting period | 3 years |
Employees and Non Employee Directors | SARs | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Stock awards, vesting period | 4 years |
Stock awards, expiration from grant date | 10 years |
SUMMARY OF SIGNIFICANT ACCOUN50
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Convertible Senior Notes (Details) | Sep. 30, 2017 |
Convertible Notes | Convertible Senior Notes | |
Debt Instrument [Line Items] | |
Debt, stated interest rate | 1.50% |
SUMMARY OF SIGNIFICANT ACCOUN51
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Accounting Standards (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 30, 2016 | Jan. 01, 2016 | |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||
Additional days in reporting period | 2 days | ||
Income tax expense (benefit) | $ (895) | $ 85,580 | $ 83,698 |
Accounting Standards Update 2016-09 | |||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||
Income tax expense (benefit) | (6,100) | ||
Retained Earnings | |||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||
Impact of adoption of ASU 2016-09 | $ 371 | ||
Retained Earnings | Accounting Standards Update 2016-09, Forfeiture Rate Component | |||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||
Impact of adoption of ASU 2016-09 | $ 400 |
INCOME TAXES - Additional Infor
INCOME TAXES - Additional Information (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 30, 2016 | Jan. 01, 2016 | |
Income Taxes [Line Items] | |||
Decrease in income tax expense | $ 65,200,000 | ||
Decrease net deferred tax liability | 65,200,000 | ||
Income tax expense (benefit), excess tab benefits related to the vesting or exercise of employee share-based awards | 6,100,000 | ||
Change in valuation allowance | (3,900,000) | $ 1,500,000 | $ (3,700,000) |
Excess tax benefits related to the vesting or exercise of employee share based awards not included In tax provision | 1,200,000 | 9,400,000 | |
Taxes paid | 49,300,000 | $ 47,800,000 | $ 50,200,000 |
Non-United States Subsidiaries | |||
Income Taxes [Line Items] | |||
Cumulative unremitted earnings | 184,000,000 | ||
Foreign | |||
Income Taxes [Line Items] | |||
Net operating loss carry forwards | 37,200,000 | ||
Federal | |||
Income Taxes [Line Items] | |||
Net operating loss carry forwards | 0 | ||
State | |||
Income Taxes [Line Items] | |||
Net operating loss carry forwards | $ 1,300,000 | ||
Minimum | |||
Income Taxes [Line Items] | |||
Income tax holiday period | 10 years | ||
Maximum | |||
Income Taxes [Line Items] | |||
Income tax holiday period | 30 years |
INCOME TAXES - Provision Taxes
INCOME TAXES - Provision Taxes by Geographic Region (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 30, 2016 | Jan. 01, 2016 | |
Income Tax Disclosure [Abstract] | |||
United States | $ 217,348 | $ 220,169 | $ 197,519 |
Non-U.S. jurisdictions | 8,535 | 2,759 | 8,978 |
INCOME BEFORE INCOME TAXES | $ 225,883 | $ 222,928 | $ 206,497 |
INCOME TAXES - Provision for In
INCOME TAXES - Provision for Income Taxes (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 30, 2016 | Jan. 01, 2016 | |
Current: | |||
– U.S. Federal | $ (48,735) | $ (35,715) | $ (44,728) |
– U.S. State | (7,370) | (4,926) | (4,027) |
– Non-U.S. | (7,043) | (4,902) | (6,953) |
Current Income Tax Expense (Benefit) | (63,148) | (45,543) | (55,708) |
Deferred: | |||
– U.S. Federal | 49,072 | (38,332) | (25,350) |
– U.S. State | (279) | (3,432) | (4,554) |
– Non-U.S. | 15,250 | 1,727 | 1,914 |
Deferred income taxes | 64,043 | (40,037) | (27,990) |
Provision for income taxes | $ 895 | $ (85,580) | $ (83,698) |
INCOME TAXES - Deferred Tax Ass
INCOME TAXES - Deferred Tax Assets and Liabilities (Details) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 30, 2016 |
Deferred Tax Assets | ||
Inventory | $ 24,814 | $ 24,821 |
Reserves | 29,854 | 38,677 |
Long lived intangible assets | 15,746 | 31,464 |
Net operating loss carry-forwards | 38,831 | 49,205 |
Tax credits | 39,593 | 21,345 |
Other, net | 53,397 | 52,263 |
Deferred tax assets | 202,235 | 217,775 |
Less valuation allowance | (43,987) | (47,839) |
Net deferred tax assets | 158,248 | 169,936 |
Deferred Tax Liabilities | ||
Property and equipment | (16,360) | (15,560) |
Deferred sales of vacation ownership interests | (220,130) | (296,600) |
Deferred tax liabilities | (236,490) | (312,160) |
Total net deferred tax liabilities | $ (78,242) | $ (142,224) |
INCOME TAXES - Reconciliation o
INCOME TAXES - Reconciliation of US Statutory Income Tax Rate to Effective Tax Rate (Details) | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 30, 2016 | Jan. 01, 2016 | |
Income Tax Disclosure [Abstract] | |||
U.S. statutory income tax rate | 35.00% | 35.00% | 35.00% |
U.S. state income taxes, net of U.S. federal tax benefit | 2.42% | 2.47% | 2.62% |
Permanent differences | (0.65%) | 1.03% | 1.65% |
Impact related to the Tax Cuts and Jobs Act | (28.86%) | 0.00% | 0.00% |
Excess tax benefits related to share-based compensation | (2.70%) | 0.00% | 0.00% |
Foreign tax rate changes | (2.11%) | 0.05% | 0.01% |
Non-U.S. income (loss) | (2.81%) | 0.09% | (0.63%) |
Other items | (0.76%) | (0.95%) | 1.22% |
Change in valuation allowance | 0.07% | 0.70% | 0.66% |
Effective rate | (0.40%) | 38.39% | 40.53% |
VACATION OWNERSHIP NOTES RECE57
VACATION OWNERSHIP NOTES RECEIVABLE - Composition of Notes, Net of Reserves (Details) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 30, 2016 |
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Vacation ownership notes receivable, net | $ 1,119,631 | $ 972,311 |
Vacation ownership notes receivable — securitized | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Vacation ownership notes receivable, net | 815,331 | 717,543 |
Eligible for securitization | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Vacation ownership notes receivable, net | 142,269 | 98,508 |
Not eligible for securitization | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Vacation ownership notes receivable, net | 162,031 | 156,260 |
Vacation ownership notes receivable — non-securitized | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Vacation ownership notes receivable, net | $ 304,300 | $ 254,768 |
VACATION OWNERSHIP NOTES RECE58
VACATION OWNERSHIP NOTES RECEIVABLE - Future Principal Payments, Net of Reserves, and Interest Rates (Details) $ in Thousands | Dec. 31, 2017USD ($) |
Future Minimum Payments Receivable [Line Items] | |
2,018 | $ 142,925 |
2,019 | 125,972 |
2,020 | 122,656 |
2,021 | 119,478 |
2,022 | 116,144 |
Thereafter | 492,456 |
Balance at year-end 2017 | 1,119,631 |
Non-Securitized Vacation Ownership Notes Receivable | |
Future Minimum Payments Receivable [Line Items] | |
2,018 | 48,846 |
2,019 | 35,253 |
2,020 | 30,567 |
2,021 | 26,127 |
2,022 | 23,953 |
Thereafter | 139,554 |
Balance at year-end 2017 | 304,300 |
Securitized Vacation Ownership Notes Receivable | |
Future Minimum Payments Receivable [Line Items] | |
2,018 | 94,079 |
2,019 | 90,719 |
2,020 | 92,089 |
2,021 | 93,351 |
2,022 | 92,191 |
Thereafter | 352,902 |
Balance at year-end 2017 | $ 815,331 |
Weighted Average | |
Future Minimum Payments Receivable [Line Items] | |
Stated interest rate | 12.30% |
Weighted Average | Non-Securitized Vacation Ownership Notes Receivable | |
Future Minimum Payments Receivable [Line Items] | |
Stated interest rate | 11.50% |
Weighted Average | Securitized Vacation Ownership Notes Receivable | |
Future Minimum Payments Receivable [Line Items] | |
Stated interest rate | 12.60% |
Minimum | |
Future Minimum Payments Receivable [Line Items] | |
Stated interest rate | 0.00% |
Minimum | Non-Securitized Vacation Ownership Notes Receivable | |
Future Minimum Payments Receivable [Line Items] | |
Stated interest rate | 0.00% |
Minimum | Securitized Vacation Ownership Notes Receivable | |
Future Minimum Payments Receivable [Line Items] | |
Stated interest rate | 4.90% |
Maximum | |
Future Minimum Payments Receivable [Line Items] | |
Stated interest rate | 18.00% |
Maximum | Non-Securitized Vacation Ownership Notes Receivable | |
Future Minimum Payments Receivable [Line Items] | |
Stated interest rate | 18.00% |
Maximum | Securitized Vacation Ownership Notes Receivable | |
Future Minimum Payments Receivable [Line Items] | |
Stated interest rate | 18.00% |
VACATION OWNERSHIP NOTES RECE59
VACATION OWNERSHIP NOTES RECEIVABLE - Interest Income (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 30, 2016 | Jan. 01, 2016 | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Interest income associated with vacation ownership notes receivable | $ 127,983 | $ 120,113 | $ 118,020 |
Vacation ownership notes receivable — securitized | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Interest income associated with vacation ownership notes receivable | 101,193 | 96,606 | 89,693 |
Vacation ownership notes receivable — non-securitized | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Interest income associated with vacation ownership notes receivable | $ 26,790 | $ 23,507 | $ 28,327 |
VACATION OWNERSHIP NOTES RECE60
VACATION OWNERSHIP NOTES RECEIVABLE - Notes Receivable Reserves (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 30, 2016 | Jan. 01, 2016 | |
Time Sharing Transactions, Allowance for Uncollectible Accounts [Roll Forward] | |||
Beginning Balance | $ 110,363 | $ 103,239 | $ 118,418 |
Provision for loan losses | 50,552 | 47,157 | 33,041 |
Securitizations | 0 | 0 | 0 |
Clean-up calls | 0 | ||
Write-offs | (45,257) | (40,033) | (48,220) |
Defaulted vacation ownership notes receivable repurchase activity | 0 | 0 | 0 |
Ending Balance | 115,658 | 110,363 | 103,239 |
Non-Securitized Vacation Ownership Notes Receivable | |||
Time Sharing Transactions, Allowance for Uncollectible Accounts [Roll Forward] | |||
Beginning Balance | 56,628 | 55,584 | 64,752 |
Provision for loan losses | 41,531 | 28,652 | 23,832 |
Securitizations | (29,071) | (28,322) | (16,491) |
Clean-up calls | 7,115 | ||
Write-offs | (45,257) | (40,033) | (48,220) |
Defaulted vacation ownership notes receivable repurchase activity | 28,324 | 30,251 | 24,596 |
Ending Balance | 56,150 | 56,628 | 55,584 |
Securitized Vacation Ownership Notes Receivable | |||
Time Sharing Transactions, Allowance for Uncollectible Accounts [Roll Forward] | |||
Beginning Balance | 53,735 | 47,655 | 53,666 |
Provision for loan losses | 9,021 | 18,505 | 9,209 |
Securitizations | 29,071 | 28,322 | 16,491 |
Clean-up calls | (7,115) | ||
Write-offs | 0 | 0 | 0 |
Defaulted vacation ownership notes receivable repurchase activity | (28,324) | (30,251) | (24,596) |
Ending Balance | 59,508 | 53,735 | $ 47,655 |
Warehouse Credit Facility | |||
Time Sharing Transactions, Allowance for Uncollectible Accounts [Roll Forward] | |||
Clean-up of Warehouse Credit Facility | 0 | 0 | |
Warehouse Credit Facility | Non-Securitized Vacation Ownership Notes Receivable | |||
Time Sharing Transactions, Allowance for Uncollectible Accounts [Roll Forward] | |||
Clean-up of Warehouse Credit Facility | 3,995 | 10,496 | |
Warehouse Credit Facility | Securitized Vacation Ownership Notes Receivable | |||
Time Sharing Transactions, Allowance for Uncollectible Accounts [Roll Forward] | |||
Clean-up of Warehouse Credit Facility | $ (3,995) | $ (10,496) |
VACATION OWNERSHIP NOTES RECE61
VACATION OWNERSHIP NOTES RECEIVABLE - Recorded Investment in Non-accrual Notes Receivable that are Past Due (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2017 | Dec. 30, 2016 | |
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Investment in notes receivable on non-accrual status | $ 46,214 | $ 50,479 |
Average investment in vacation ownership notes receivable on non-accrual status during 2017 | 48,347 | |
Non-Securitized Vacation Ownership Notes Receivable | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Investment in notes receivable on non-accrual status | 38,786 | 43,792 |
Average investment in vacation ownership notes receivable on non-accrual status during 2017 | 41,289 | |
Securitized Vacation Ownership Notes Receivable | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Investment in notes receivable on non-accrual status | 7,428 | $ 6,687 |
Average investment in vacation ownership notes receivable on non-accrual status during 2017 | $ 7,058 |
VACATION OWNERSHIP NOTES RECE62
VACATION OWNERSHIP NOTES RECEIVABLE - Aging of Recorded Investment (Details) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 30, 2016 |
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total past due | $ 71,876 | $ 74,727 |
Current | 1,163,413 | 1,007,947 |
Total vacation ownership notes receivable | 1,235,289 | 1,082,674 |
Non-Securitized Vacation Ownership Notes Receivable | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total past due | 45,895 | 51,572 |
Current | 314,555 | 259,824 |
Total vacation ownership notes receivable | 360,450 | 311,396 |
Securitized Vacation Ownership Notes Receivable | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total past due | 25,981 | 23,155 |
Current | 848,858 | 748,123 |
Total vacation ownership notes receivable | 874,839 | 771,278 |
31 – 90 days past due | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total past due | 25,662 | 24,248 |
31 – 90 days past due | Non-Securitized Vacation Ownership Notes Receivable | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total past due | 7,109 | 7,780 |
31 – 90 days past due | Securitized Vacation Ownership Notes Receivable | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total past due | 18,553 | 16,468 |
91 – 150 days past due | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total past due | 11,769 | 10,668 |
91 – 150 days past due | Non-Securitized Vacation Ownership Notes Receivable | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total past due | 4,341 | 3,981 |
91 – 150 days past due | Securitized Vacation Ownership Notes Receivable | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total past due | 7,428 | 6,687 |
Greater than 150 days past due | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total past due | 34,445 | 39,811 |
Greater than 150 days past due | Non-Securitized Vacation Ownership Notes Receivable | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total past due | 34,445 | 39,811 |
Greater than 150 days past due | Securitized Vacation Ownership Notes Receivable | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total past due | $ 0 | $ 0 |
FINANCIAL INSTRUMENTS - Financi
FINANCIAL INSTRUMENTS - Financial Assets and Liabilities (Details) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 30, 2016 |
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Vacation ownership notes receivable, net | $ 1,119,631 | $ 972,311 |
Other assets | 172,516 | 128,935 |
Debt, net | (1,095,213) | (737,224) |
Non-interest bearing note payable, net | (13,155) | (15,873) |
Securitized Vacation Ownership Notes Receivable | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Vacation ownership notes receivable, net | 815,331 | 717,543 |
Non-Securitized Vacation Ownership Notes Receivable | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Vacation ownership notes receivable, net | 304,300 | 254,768 |
Carrying Amount | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Other assets | 13,708 | 0 |
Total financial assets | 1,133,339 | 972,311 |
Debt, net | (1,095,213) | (737,224) |
Non-interest bearing note payable, net | (60,560) | 0 |
Total financial liabilities | (1,087,967) | (729,188) |
Carrying Amount | Non-Recourse Debt | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Debt, net | (834,889) | (729,188) |
Carrying Amount | Convertible Senior Notes | Senior Notes | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Debt, net | (192,518) | 0 |
Carrying Amount | Securitized Vacation Ownership Notes Receivable | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Vacation ownership notes receivable, net | 815,331 | 717,543 |
Carrying Amount | Non-Securitized Vacation Ownership Notes Receivable | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Vacation ownership notes receivable, net | 304,300 | 254,768 |
Fair Value | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Other assets | 13,708 | 0 |
Total financial assets | 1,294,661 | 1,103,170 |
Non-interest bearing note payable, net | (60,560) | 0 |
Total financial liabilities | (1,156,472) | (725,963) |
Fair Value | Non-Recourse Debt | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Debt, net | (836,028) | (725,963) |
Fair Value | Convertible Senior Notes | Senior Notes | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Debt, net | (259,884) | 0 |
Fair Value | Securitized Vacation Ownership Notes Receivable | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Vacation ownership notes receivable, net | 956,292 | 834,009 |
Fair Value | Non-Securitized Vacation Ownership Notes Receivable | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Vacation ownership notes receivable, net | $ 324,661 | $ 269,161 |
FINANCIAL INSTRUMENTS - Non-sec
FINANCIAL INSTRUMENTS - Non-securitized Notes Receivable (Details) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 30, 2016 |
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Vacation ownership notes receivable, net | $ 1,119,631 | $ 972,311 |
Non-Securitized Vacation Ownership Notes Receivable | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Vacation ownership notes receivable, net | 304,300 | 254,768 |
Carrying Amount | Non-Securitized Vacation Ownership Notes Receivable | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Vacation ownership notes receivable, net | 304,300 | 254,768 |
Carrying Amount | Non-Securitized Vacation Ownership Notes Receivable | Eligible for securitization | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Vacation ownership notes receivable, net | 142,269 | 98,508 |
Carrying Amount | Non-Securitized Vacation Ownership Notes Receivable | Not eligible for securitization | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Vacation ownership notes receivable, net | 162,031 | 156,260 |
Fair Value | Non-Securitized Vacation Ownership Notes Receivable | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Vacation ownership notes receivable, net | 324,661 | 269,161 |
Fair Value | Non-Securitized Vacation Ownership Notes Receivable | Eligible for securitization | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Vacation ownership notes receivable, net | 162,630 | 112,901 |
Fair Value | Non-Securitized Vacation Ownership Notes Receivable | Not eligible for securitization | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Vacation ownership notes receivable, net | $ 162,031 | $ 156,260 |
ACQUISITIONS AND DISPOSITIONS (
ACQUISITIONS AND DISPOSITIONS (Details) $ in Thousands, AUD in Millions | 3 Months Ended | 12 Months Ended | |||||||||||||
Sep. 30, 2017USD ($)Unit | Jun. 30, 2017USD ($)Unit | Jun. 17, 2016USD ($)room | Jun. 17, 2016AUDroom | Mar. 25, 2016USD ($) | Sep. 11, 2015USD ($)Unit | Sep. 11, 2015AUD | Jun. 19, 2015USD ($) | Mar. 27, 2015USD ($) | Jun. 20, 2014USD ($) | Dec. 31, 2017USD ($) | Dec. 30, 2016USD ($) | Dec. 30, 2016AUD | Jan. 01, 2016USD ($) | Sep. 11, 2015AUDUnit | |
Business Acquisition [Line Items] | |||||||||||||||
Purchase of vacation ownership units for future transfer to inventory | $ 33,594 | $ 0 | $ 0 | ||||||||||||
Non-cash issuance of debt in connection with acquisition of vacation ownership units | 63,558 | 0 | 0 | ||||||||||||
Capital expenditures for property and equipment (excluding inventory) | $ 26,297 | 34,770 | 35,735 | ||||||||||||
Bali, Indonesia Resort One | |||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||
Number of vacation ownership units acquired | Unit | 51 | ||||||||||||||
Consideration transferred | $ 23,800 | ||||||||||||||
Inventory | 21,700 | ||||||||||||||
Property And equipment | $ 2,100 | ||||||||||||||
Marco Island, Florida | |||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||
Number of vacation ownership units acquired | Unit | 36 | ||||||||||||||
Purchase of vacation ownership units for future transfer to inventory | $ 33,600 | ||||||||||||||
Cash from disposal of property | $ 5,400 | ||||||||||||||
Vacation ownership inventory sold | 3,100 | ||||||||||||||
Marco Island, Florida | Notes Receivable | |||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||
Non cash proceeds on sale of property | 500 | ||||||||||||||
Big Island Of Hawaii | |||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||
Number of vacation ownership units acquired | Unit | 112 | ||||||||||||||
Value of consideration given | $ 500 | ||||||||||||||
Non-cash issuance of debt in connection with acquisition of vacation ownership units | 63,600 | ||||||||||||||
Acquisition of rooms of an operating hotel | $ 27,300 | ||||||||||||||
Miami, Florida | |||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||
Acquisition of an operating hotel | $ 23,500 | ||||||||||||||
Cash paid for acquisition of operating hotel | $ 23,500 | ||||||||||||||
San Francisco, California | |||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||
Number of units disposed of in connection with disposition of asset | room | 19 | 19 | |||||||||||||
Cash from disposal of property | $ 19,500 | ||||||||||||||
Gain on sale of real estate, other | 10,500 | ||||||||||||||
Surfers Paradise, Australia | |||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||
Acquisition of an operating hotel | $ 62,300 | AUD 84.5 | |||||||||||||
Cash paid for acquisition of operating hotel | 61,000 | 82.6 | |||||||||||||
Cash from disposal of property | 50,900 | AUD 70.5 | |||||||||||||
Gain on sale of real estate, other | $ 900 | AUD 1.2 | |||||||||||||
Assumed net liabilities for acquisition of operating hotel | 1,300 | AUD 1.9 | |||||||||||||
Purchase price allocation, land | 21,300 | AUD 28.9 | |||||||||||||
Purchase price allocation, building and leasehold improvements | 36,500 | 49.5 | |||||||||||||
Surfers Paradise, Australia | Maximum | |||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||
Guarantee of net operating income associated with the disposition of real estate | $ 2,200 | AUD 2.9 | |||||||||||||
Surfers Paradise, Australia | Furniture And Equipment | |||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||
Purchase price allocation, furniture and equipment | $ 4,500 | AUD 6.1 | |||||||||||||
Washington, D.C. | |||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||
Number of rooms | Unit | 71 | 71 | |||||||||||||
Acquisition of rooms of an operating hotel | $ 32,000 | ||||||||||||||
San Diego, California | |||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||
Acquisition of an operating hotel | 55,000 | ||||||||||||||
Cash paid for acquisition of operating hotel | 55,000 | ||||||||||||||
Purchase price allocation, property and equipment | 54,300 | ||||||||||||||
Purchase price allocation, other assets | $ 700 | ||||||||||||||
Purchase of operating hotels | 46,600 | ||||||||||||||
Capital expenditures for property and equipment (excluding inventory) | 7,700 | ||||||||||||||
Hawaii | |||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||
Cash from disposal of property | $ 20,000 | $ 40,000 | |||||||||||||
Purchase and sale agreement, gross cash consideration | $ 60,000 | ||||||||||||||
Hawaii | Gains and other income | |||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||
Gain on sale of real estate, other | $ 8,700 |
EARNINGS PER SHARE - Additional
EARNINGS PER SHARE - Additional Information (Details) - $ / shares | 12 Months Ended | |||
Dec. 31, 2017 | Dec. 30, 2016 | Jan. 01, 2016 | Sep. 20, 2017 | |
Performance Shares | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Shares excluded from the calculation of diluted earnings per share (in shares) | 238,000 | 217,000 | 136,000 | |
SARs | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Shares excluded from the calculation of diluted earnings per share (in shares) | 62,018 | 62,018 | ||
Stock options and SARs not included in the calculation of diluted earning per share because exercise prices exceeded market prices, exercise prices (in usd per share) | $ 77.42 | $ 77.42 | ||
Private Warrants | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Exercise price of warrants (in usd per share) | $ 176.68 |
EARNINGS PER SHARE - Reconcilia
EARNINGS PER SHARE - Reconciliation of Earnings Per Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 4 Months Ended | 12 Months Ended | ||||||||
Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Sep. 09, 2016 | Jun. 17, 2016 | Mar. 25, 2016 | Dec. 30, 2016 | Dec. 31, 2017 | Dec. 30, 2016 | Jan. 01, 2016 | |
Computation of Basic Earnings Per Share | |||||||||||
Net income | $ 108,040 | $ 40,762 | $ 44,276 | $ 33,700 | $ 26,807 | $ 36,309 | $ 24,408 | $ 49,824 | $ 226,778 | $ 137,348 | $ 122,799 |
Shares for basic earnings per share (in shares) | 27,078 | 27,882 | 31,487 | ||||||||
Basic earnings per share (in usd per share) | $ 4.05 | $ 1.50 | $ 1.62 | $ 1.24 | $ 0.99 | $ 1.28 | $ 0.84 | $ 1.83 | $ 8.38 | $ 4.93 | $ 3.90 |
Computation of Diluted Earnings Per Share | |||||||||||
Net income | $ 108,040 | $ 40,762 | $ 44,276 | $ 33,700 | $ 26,807 | $ 36,309 | $ 24,408 | $ 49,824 | $ 226,778 | $ 137,348 | $ 122,799 |
Shares for basic earnings per share (in shares) | 27,078 | 27,882 | 31,487 | ||||||||
Effect of dilutive shares outstanding | |||||||||||
Employee stock options and SARs (in shares) | 438 | 367 | 446 | ||||||||
Restricted stock units (in shares) | 217 | 173 | 235 | ||||||||
Shares for diluted earnings per share (in shares) | 27,733 | 28,422 | 32,168 | ||||||||
Diluted earnings per share (in usd per share) | $ 3.95 | $ 1.47 | $ 1.58 | $ 1.21 | $ 0.97 | $ 1.26 | $ 0.82 | $ 1.80 | $ 8.18 | $ 4.83 | $ 3.82 |
INVENTORY - Composition of Inve
INVENTORY - Composition of Inventory (Details) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 30, 2016 |
Inventory Disclosure [Abstract] | ||
Finished goods | $ 379,194 | $ 337,949 |
Work-in-progress | 2,315 | 39,486 |
Land and infrastructure | 330,002 | 330,728 |
Real estate inventory | 711,511 | 708,163 |
Operating supplies and retail inventory | 5,022 | 4,373 |
Inventory | $ 716,533 | $ 712,536 |
INVENTORY - Additional Informat
INVENTORY - Additional Information (Details) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 30, 2016 |
Inventory [Line Items] | ||
Land and infrastructure | $ 330,002 | $ 330,728 |
Amount of completed vacation ownership units classified as property and equipment | 48,300 | |
Purchase obligation | 480,500 | |
Estimated Future Foreclosures | ||
Inventory [Line Items] | ||
Land and infrastructure | $ 67,600 |
PROPERTY AND EQUIPMENT - Compos
PROPERTY AND EQUIPMENT - Composition of Property and Equipment (Details) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 30, 2016 |
Property, Plant and Equipment [Abstract] | ||
Land | $ 60,174 | $ 54,975 |
Buildings and leasehold improvements | 258,919 | 213,190 |
Furniture and equipment | 54,394 | 51,053 |
Information technology | 184,635 | 180,075 |
Construction in progress | 22,877 | 27,493 |
Property, plant and equipment, gross | 580,999 | 526,786 |
Accumulated depreciation | (328,272) | (323,984) |
Property, plant and equipment, net | $ 252,727 | $ 202,802 |
PROPERTY AND EQUIPMENT - Additi
PROPERTY AND EQUIPMENT - Additional Information (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 30, 2016 | Jan. 01, 2016 | |
Property, Plant and Equipment [Abstract] | |||
Depreciation | $ 21,494 | $ 21,044 | $ 22,217 |
CONTINGENCIES AND COMMITMENTS -
CONTINGENCIES AND COMMITMENTS - Additional Information (Details) | Jul. 01, 2013Plaintiff | Mar. 31, 2017Plaintiff | Jun. 30, 2013Plaintiff | Apr. 30, 2013Plaintiff | Sep. 30, 2017USD ($)Property | Dec. 31, 2017USD ($)PropertyUnit | Dec. 30, 2016USD ($) | Jan. 01, 2016USD ($) | May 31, 2017Plaintiff | Mar. 31, 2018USD ($) | Feb. 27, 2018USD ($) |
Commitments and Contingencies Disclosure [Line Items] | |||||||||||
Contractual commitments future minimum payments due | $ 480,500,000 | ||||||||||
Surety bonds issued | 34,600,000 | ||||||||||
Letters of credit outstanding | 4,600,000 | ||||||||||
Nonoperating income (expense) | $ (5,772,000) | $ (11,201,000) | $ (9,557,000) | ||||||||
Gain on business interruption insurance recovery | $ 8,700,000 | ||||||||||
Kapalua Bay Settlement | |||||||||||
Commitments and Contingencies Disclosure [Line Items] | |||||||||||
Number of plaintiffs in lawsuits | Plaintiff | 2 | 38 | 12 | ||||||||
Loss contingency, number of plaintiffs, released claims | Plaintiff | 2 | 2 | |||||||||
Ritz Carlton Club Aspen Highlands | |||||||||||
Commitments and Contingencies Disclosure [Line Items] | |||||||||||
Number of plaintiffs in lawsuits | Plaintiff | 232 | ||||||||||
Minimum | |||||||||||
Commitments and Contingencies Disclosure [Line Items] | |||||||||||
Number of properties | Property | 65 | ||||||||||
Land Lease | |||||||||||
Commitments and Contingencies Disclosure [Line Items] | |||||||||||
Lease term | 30 years | ||||||||||
Corporate Facilities Leases | |||||||||||
Commitments and Contingencies Disclosure [Line Items] | |||||||||||
Lease term | 6 years | ||||||||||
Other Operating Leases | Minimum | |||||||||||
Commitments and Contingencies Disclosure [Line Items] | |||||||||||
Lease term | 3 years | ||||||||||
Other Operating Leases | Maximum | |||||||||||
Commitments and Contingencies Disclosure [Line Items] | |||||||||||
Lease term | 10 years | ||||||||||
Marco Island, Florida | |||||||||||
Commitments and Contingencies Disclosure [Line Items] | |||||||||||
Contractual commitments future minimum payments due | $ 108,200,000 | ||||||||||
Commitment to purchase due in 2018 | 23,700,000 | ||||||||||
Commitment to purchase due in 2019 | 84,500,000 | ||||||||||
Information technology hardware and software | |||||||||||
Commitments and Contingencies Disclosure [Line Items] | |||||||||||
Contractual commitments future minimum payments due | 24,600,000 | ||||||||||
Commitment to purchase due in 2018 | 15,300,000 | ||||||||||
Commitment to purchase due in 2019 | 5,500,000 | ||||||||||
Commitment to purchase due in 2020 | 1,400,000 | ||||||||||
Commitment to purchase due in 2021 | 900,000 | ||||||||||
Commitment to purchase due in 2022 | 800,000 | ||||||||||
Commitment to purchase due thereafter | 700,000 | ||||||||||
William and Sharon Petrick Case | |||||||||||
Commitments and Contingencies Disclosure [Line Items] | |||||||||||
Number of plaintiffs in lawsuits | Plaintiff | 69 | ||||||||||
New York City | |||||||||||
Commitments and Contingencies Disclosure [Line Items] | |||||||||||
Contractual commitments future minimum payments due | 170,200,000 | ||||||||||
Commitment to purchase due in 2019 | 108,500,000 | ||||||||||
Commitment to purchase due in 2020 | 61,700,000 | ||||||||||
New York City | Other Operating Leases | |||||||||||
Commitments and Contingencies Disclosure [Line Items] | |||||||||||
Minimum lease payments | 7,200,000 | ||||||||||
Bali, Indonesia Resort | |||||||||||
Commitments and Contingencies Disclosure [Line Items] | |||||||||||
Commitment to purchase due in 2018 | 13,700,000 | ||||||||||
Commitment to purchase due in 2019 | $ 25,400,000 | ||||||||||
Fiscal Year 2019 | Bali, Indonesia Resort | |||||||||||
Commitments and Contingencies Disclosure [Line Items] | |||||||||||
Expected number of ownership units to be acquired | Unit | 88 | ||||||||||
Revolving Corporate Credit Facility | Revolving Credit Facility | |||||||||||
Commitments and Contingencies Disclosure [Line Items] | |||||||||||
Revolving credit facility amount | $ 250,000,000 | ||||||||||
Hurricane | |||||||||||
Commitments and Contingencies Disclosure [Line Items] | |||||||||||
Number of properties | Property | 20 | ||||||||||
Nonoperating income (expense) | $ 1,300,000 | ||||||||||
Scenario, Forecast | Bali, Indonesia Resort | |||||||||||
Commitments and Contingencies Disclosure [Line Items] | |||||||||||
Commitment to purchase due in 2018 | $ 5,800,000 | ||||||||||
Commitment to purchase due in 2019 | 30,900,000 | ||||||||||
Commitment to purchase due in 2020 | $ 1,900,000 | ||||||||||
Scenario, Forecast | San Francisco, California | |||||||||||
Commitments and Contingencies Disclosure [Line Items] | |||||||||||
Contractual commitments future minimum payments due | $ 163,500,000 | ||||||||||
Commitment to purchase due in 2020 | 100,000,000 | ||||||||||
Commitment to purchase due in 2021 | $ 63,500,000 |
CONTINGENCIES AND COMMITMENTS73
CONTINGENCIES AND COMMITMENTS - Summary of Future Obligations Under Operating Leases (Details) $ in Thousands | Dec. 31, 2017USD ($) |
Operating Leases | |
2,018 | $ 17,451 |
2,019 | 14,532 |
2,020 | 12,717 |
2,021 | 9,424 |
2,022 | 6,612 |
Thereafter | 35,486 |
Total minimum lease payments | 96,222 |
Land Lease | |
Operating Leases | |
2,018 | 1,157 |
2,019 | 1,157 |
2,020 | 1,157 |
2,021 | 1,157 |
2,022 | 1,157 |
Thereafter | 6,939 |
Total minimum lease payments | 12,724 |
Corporate Facilities Leases | |
Operating Leases | |
2,018 | 3,628 |
2,019 | 3,739 |
2,020 | 3,850 |
2,021 | 2,646 |
2,022 | 0 |
Thereafter | 0 |
Total minimum lease payments | 13,863 |
Other Operating Leases | |
Operating Leases | |
2,018 | 12,666 |
2,019 | 9,636 |
2,020 | 7,710 |
2,021 | 5,621 |
2,022 | 5,455 |
Thereafter | 28,547 |
Total minimum lease payments | $ 69,635 |
CONTINGENCIES AND COMMITMENTS74
CONTINGENCIES AND COMMITMENTS - Composition of Rental Expense Associated with Operating Leases (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 30, 2016 | Jan. 01, 2016 | |
Commitments and Contingencies Disclosure [Abstract] | |||
Minimum rentals | $ 9,390 | $ 8,639 | $ 9,401 |
Additional rentals | 3,905 | 3,845 | 3,876 |
Operating Leases, Rent Expense, Net, Total | $ 13,295 | $ 12,484 | $ 13,277 |
DEBT - Debt Balances, Net of Un
DEBT - Debt Balances, Net of Unamortized Debt Issuance Costs (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2017 | Dec. 30, 2016 | |
Debt Instrument [Line Items] | ||
Debt, gross | $ 1,145,937 | |
Debt, net | 1,095,213 | $ 737,224 |
Carrying Amount | ||
Debt Instrument [Line Items] | ||
Debt, net | 1,095,213 | 737,224 |
Capital lease obligations | 7,221 | 7,221 |
Non-Recourse Debt | ||
Debt Instrument [Line Items] | ||
Debt, gross | 845,131 | |
Non-Recourse Debt | Carrying Amount | ||
Debt Instrument [Line Items] | ||
Debt, gross | 845,131 | 738,362 |
Unamortized debt issuance costs | (10,242) | (9,174) |
Debt, net | 834,889 | 729,188 |
Other Debt | ||
Debt Instrument [Line Items] | ||
Debt, gross | 27 | |
Other Debt | Carrying Amount | ||
Debt Instrument [Line Items] | ||
Debt, gross | 27 | 834 |
Unamortized debt issuance costs | (2) | (19) |
Debt, net | $ 25 | 815 |
Convertible Senior Notes | Convertible Notes | ||
Debt Instrument [Line Items] | ||
Debt Instrument, Convertible, Remaining Discount Amortization Period | 4 years 8 months 12 days | |
Debt, gross | $ 230,000 | |
Unamortized debt issuance costs | (5,886) | |
Unamortized debt discount | (31,596) | |
Convertible Senior Notes | Convertible Notes | Carrying Amount | ||
Debt Instrument [Line Items] | ||
Debt, gross | 230,000 | 0 |
Unamortized debt discount and issuance costs | (37,482) | 0 |
Debt, net | 192,518 | 0 |
Non-Interest Bearing Note Payable | Non-Interest Bearing Note Payable | ||
Debt Instrument [Line Items] | ||
Debt, gross | 63,558 | |
Non-Interest Bearing Note Payable | Non-Interest Bearing Note Payable | Carrying Amount | ||
Debt Instrument [Line Items] | ||
Debt, gross | 63,558 | 0 |
Unamortized debt discount | (2,998) | 0 |
Debt, net | $ 60,560 | $ 0 |
DEBT - Scheduled Future Princip
DEBT - Scheduled Future Principal Payments for Debt (Details) $ in Thousands | Dec. 31, 2017USD ($) |
Debt Principal Payments Year | |
2,018 | $ 128,448 |
2,019 | 130,372 |
2,020 | 93,553 |
2,021 | 94,503 |
2,022 | 323,808 |
Thereafter | 375,253 |
December 31, 2017 | 1,145,937 |
Non-Recourse Debt | |
Debt Principal Payments Year | |
2,018 | 95,768 |
2,019 | 92,273 |
2,020 | 93,553 |
2,021 | 94,503 |
2,022 | 93,808 |
Thereafter | 375,226 |
December 31, 2017 | 845,131 |
Convertible Notes | Convertible Senior Notes | |
Debt Principal Payments Year | |
2,018 | 0 |
2,019 | 0 |
2,020 | 0 |
2,021 | 0 |
2,022 | 230,000 |
Thereafter | 0 |
December 31, 2017 | 230,000 |
Non-Interest Bearing Note Payable | Non-Interest Bearing Note Payable | |
Debt Principal Payments Year | |
2,018 | 32,680 |
2,019 | 30,878 |
2,020 | 0 |
2,021 | 0 |
2,022 | 0 |
Thereafter | 0 |
December 31, 2017 | 63,558 |
Other Debt | |
Debt Principal Payments Year | |
2,018 | 0 |
2,019 | 0 |
2,020 | 0 |
2,021 | 0 |
2,022 | 0 |
Thereafter | 27 |
December 31, 2017 | 27 |
Capital Leases | |
Debt Principal Payments Year | |
2,018 | 0 |
2,019 | 7,221 |
2,020 | 0 |
2,021 | 0 |
2,022 | 0 |
Thereafter | 0 |
December 31, 2017 | $ 7,221 |
DEBT - Additional Information (
DEBT - Additional Information (Details) | Dec. 31, 2017USD ($)Loan$ / sharesshares | Dec. 07, 2017$ / shares | Sep. 21, 2017USD ($)shares | Sep. 07, 2017$ / shares | May 11, 2017$ / shares | Feb. 09, 2017$ / shares | Sep. 30, 2017USD ($)trading_dayconsecutive_trading_day$ / shares | Jun. 30, 2017USD ($) | Dec. 31, 2017USD ($)Loan$ / sharesshares | Sep. 30, 2017USD ($)$ / shares | Dec. 31, 2017USD ($)Loan$ / sharesshares | Dec. 30, 2016USD ($)$ / shares | Jan. 01, 2016USD ($)$ / shares | Sep. 29, 2017USD ($) | Sep. 25, 2017USD ($) | Sep. 20, 2017$ / sharesshares |
Debt Disclosure [Line Items] | ||||||||||||||||
Cash paid for interest, net of amounts capitalized | $ 21,600,000 | $ 23,200,000 | $ 30,200,000 | |||||||||||||
Securitization pool of vacation ownership notes receivable | $ 360,800,000 | |||||||||||||||
Proceeds from accounts receivable securitization | $ 350,000,000 | |||||||||||||||
Number of notes receivable pools failed to perform within the established parameters | Loan | 0 | 0 | ||||||||||||||
Number of notes receivable pools outstanding | Loan | 8 | 8 | 8 | |||||||||||||
Proceeds from issuance of Convertible Notes | $ 230,000,000 | $ 0 | $ 0 | |||||||||||||
Cash dividends declared per share of common stock (in usd per share) | $ / shares | $ 0.40 | $ 0.35 | $ 0.35 | $ 0.35 | $ 1.45 | $ 1.25 | $ 1.05 | |||||||||
Purchase of convertible note hedges | $ 33,235,000 | $ 0 | $ 0 | |||||||||||||
Proceeds from issuance of Warrants | $ 20,332,000 | $ 0 | $ 0 | |||||||||||||
Non-Recourse Debt | ||||||||||||||||
Debt Disclosure [Line Items] | ||||||||||||||||
Debt, weighted average interest rate | 2.50% | 2.50% | 2.50% | |||||||||||||
Non-Recourse Debt | Minimum | ||||||||||||||||
Debt Disclosure [Line Items] | ||||||||||||||||
Debt, stated interest rate | 2.20% | 2.20% | 2.20% | |||||||||||||
Non-Recourse Debt | Maximum | ||||||||||||||||
Debt Disclosure [Line Items] | ||||||||||||||||
Debt, stated interest rate | 6.30% | 6.30% | 6.30% | |||||||||||||
Convertible Notes | Convertible Senior Notes | ||||||||||||||||
Debt Disclosure [Line Items] | ||||||||||||||||
Debt, stated interest rate | 1.50% | 1.50% | ||||||||||||||
Debt instrument face amount | $ 230,000,000 | $ 230,000,000 | ||||||||||||||
Proceeds from issuance of Convertible Notes | $ 223,700,000 | |||||||||||||||
Conversion ratio | 6.7482 | 6.7508 | ||||||||||||||
Conversion price (in usd per share) | $ / shares | $ 148.13 | $ 148.19 | $ 148.13 | $ 148.19 | $ 148.13 | |||||||||||
Threshold trading days | trading_day | 20 | |||||||||||||||
Threshold consecutive trading days | consecutive_trading_day | 30 | |||||||||||||||
Threshold percentage of stock price trigger | 130.00% | |||||||||||||||
Measurement period threshold trading days | trading_day | 5 | |||||||||||||||
Measurement period threshold consecutive trading days | consecutive_trading_day | 5 | |||||||||||||||
Ratio of trading price per 1000 principle amount | 98.00% | |||||||||||||||
Redemption price | 100.00% | |||||||||||||||
Percentage of debt held by individual owner | 25.00% | |||||||||||||||
Long-term Debt | $ 192,518,000 | $ 192,518,000 | $ 192,518,000 | $ 196,800,000 | ||||||||||||
Equity component, net of issuance costs | $ 32,573,000 | $ 32,573,000 | $ 32,573,000 | $ 33,200,000 | ||||||||||||
Debt Instrument, Convertible, Remaining Discount Amortization Period | 4 years 8 months 12 days | |||||||||||||||
Debt issuance costs | $ 7,300,000 | $ 7,300,000 | ||||||||||||||
Percentage above common stock price to conversion price of convertible debt when instrument is eligible for conversion | 30.00% | 30.00% | ||||||||||||||
Convertible Notes | Over-Allotment Option | ||||||||||||||||
Debt Disclosure [Line Items] | ||||||||||||||||
Debt instrument face amount | $ 30,000,000 | $ 30,000,000 | ||||||||||||||
Non-Interest Bearing Note Payable | Non-Interest Bearing Note Payable | ||||||||||||||||
Debt Disclosure [Line Items] | ||||||||||||||||
Interest rate, effective percentage | 6.00% | 6.00% | 6.00% | |||||||||||||
MVW Owner Trust 2015-1 | Non-Recourse Debt | ||||||||||||||||
Debt Disclosure [Line Items] | ||||||||||||||||
Debt, weighted average interest rate | 2.51% | 2.51% | ||||||||||||||
MVW Owner Trust 2015-1 | Non-Recourse Debt | Class A Notes | ||||||||||||||||
Debt Disclosure [Line Items] | ||||||||||||||||
Debt, stated interest rate | 2.42% | 2.42% | ||||||||||||||
Debt instrument face amount | $ 276,000,000 | $ 276,000,000 | ||||||||||||||
MVW Owner Trust 2015-1 | Non-Recourse Debt | Class B Notes | ||||||||||||||||
Debt Disclosure [Line Items] | ||||||||||||||||
Debt, stated interest rate | 2.75% | 2.75% | ||||||||||||||
Debt instrument face amount | $ 46,900,000 | $ 46,900,000 | ||||||||||||||
MVW Owner Trust 2015-1 | Non-Recourse Debt | Class C Notes | ||||||||||||||||
Debt Disclosure [Line Items] | ||||||||||||||||
Debt, stated interest rate | 2.99% | 2.99% | ||||||||||||||
Debt instrument face amount | $ 27,100,000 | $ 27,100,000 | ||||||||||||||
Revolving Credit Facility | Minimum | ||||||||||||||||
Debt Disclosure [Line Items] | ||||||||||||||||
Commitment fee | 0.20% | |||||||||||||||
Revolving Credit Facility | Maximum | ||||||||||||||||
Debt Disclosure [Line Items] | ||||||||||||||||
Commitment fee | 0.40% | |||||||||||||||
Revolving Credit Facility | Previous Revolving Corporate Credit Facility | ||||||||||||||||
Debt Disclosure [Line Items] | ||||||||||||||||
Line of credit facility, maximum borrowing capacity | $ 200,000,000 | |||||||||||||||
Revolving Credit Facility | Revolving Corporate Credit Facility | ||||||||||||||||
Debt Disclosure [Line Items] | ||||||||||||||||
Line of credit facility, maximum borrowing capacity | $ 250,000,000 | $ 250,000,000 | $ 250,000,000 | |||||||||||||
Line of credit facility, fair value of amount outstanding | $ 0 | $ 0 | ||||||||||||||
Revolving Credit Facility | Revolving Corporate Credit Facility | Letter of Credit | ||||||||||||||||
Debt Disclosure [Line Items] | ||||||||||||||||
Line of credit facility, maximum borrowing capacity | 30,000,000 | 30,000,000 | 30,000,000 | |||||||||||||
Warehouse Credit Facility | ||||||||||||||||
Debt Disclosure [Line Items] | ||||||||||||||||
Securitization pool of vacation ownership notes receivable | $ 59,100,000 | |||||||||||||||
Proceeds from accounts receivable securitization | $ 50,000,000 | |||||||||||||||
Line of credit facility, maximum borrowing capacity | 250,000,000 | 250,000,000 | 250,000,000 | |||||||||||||
Line of credit facility, fair value of amount outstanding | $ 0 | $ 0 | $ 0 | |||||||||||||
Payable period after termination | 13 months | |||||||||||||||
Advance rate for securitization | 85.00% | |||||||||||||||
Cash flows between transferee and transferor proceeds | $ 50,300,000 | |||||||||||||||
Cash flows between transferee and transferor, funding of restricted cash | $ 300,000 | |||||||||||||||
Euro Dollar Rate | Revolving Credit Facility | Revolving Corporate Credit Facility | Minimum | ||||||||||||||||
Debt Disclosure [Line Items] | ||||||||||||||||
Debt instrument, percentage points added to the reference rate | 0.50% | |||||||||||||||
Euro Dollar Rate | Revolving Credit Facility | Revolving Corporate Credit Facility | Maximum | ||||||||||||||||
Debt Disclosure [Line Items] | ||||||||||||||||
Debt instrument, percentage points added to the reference rate | 2.75% | |||||||||||||||
Convertible Note Hedges | ||||||||||||||||
Debt Disclosure [Line Items] | ||||||||||||||||
Indexed shares (in shares) | shares | 1,550,000 | |||||||||||||||
Purchase of convertible note hedges | $ 33,200,000 | |||||||||||||||
Convertible note hedges exercised (in shares) | shares | 0 | 0 | 0 | |||||||||||||
Private Warrants | ||||||||||||||||
Debt Disclosure [Line Items] | ||||||||||||||||
Number of securities called by warrants (in shares) | shares | 1,550,000 | |||||||||||||||
Exercise price of warrants (in usd per share) | $ / shares | $ 176.68 | |||||||||||||||
Proceeds from issuance of Warrants | $ 20,300,000 | |||||||||||||||
Number of warrants exercised (in shares) | shares | 0 | 0 | 0 | |||||||||||||
Conversion Premium, Stock Price Exceeds The Conversion Price | Convertible Notes | Convertible Senior Notes | ||||||||||||||||
Debt Disclosure [Line Items] | ||||||||||||||||
Effective percentage above common stock price to conversion price of convertible debt, as effected by convertible note hedge and warrant transactions | 55.00% | 55.00% | ||||||||||||||
Carrying Amount | Convertible Notes | Convertible Senior Notes | ||||||||||||||||
Debt Disclosure [Line Items] | ||||||||||||||||
Interest rate, effective percentage | 4.70% | 4.70% | 4.70% |
DEBT - Net Carrying Value Of Th
DEBT - Net Carrying Value Of The Convertible Notes (Details) - Convertible Notes - Convertible Senior Notes - USD ($) $ in Thousands | Dec. 31, 2017 | Sep. 25, 2017 |
Debt Instrument [Line Items] | ||
Principal amount | $ 230,000 | |
Unamortized debt discount | (31,596) | |
Unamortized debt issuance costs | (5,886) | |
Long-term Debt | 192,518 | $ 196,800 |
Equity component, net of issuance costs | $ 32,573 | $ 33,200 |
DEBT - Interest Expense Related
DEBT - Interest Expense Related To The Convertible Notes (Details) - Convertible Notes - Convertible Senior Notes $ in Thousands | 12 Months Ended |
Dec. 31, 2017USD ($) | |
Debt Instrument [Line Items] | |
Contractual interest expense | $ 920 |
Amortization of debt discount | 1,629 |
Debt issuance cost amortization | 325 |
Interest Expense, Debt | $ 2,874 |
SHAREHOLDERS' EQUITY - Addition
SHAREHOLDERS' EQUITY - Additional Information (Details) - $ / shares | Dec. 31, 2017 | Aug. 01, 2017 | Dec. 30, 2016 |
Equity [Abstract] | |||
Common stock, shares authorized (in shares) | 100,000,000 | 100,000,000 | |
Common stock, par value (in usd per share) | $ 0.01 | $ 0.01 | |
Common stock, shares issued (in shares) | 36,861,843 | 36,633,868 | |
Common stock, shares outstanding | 26,461,296 | 26,990,306 | |
Treasury stock, shares (in shares) | 10,400,547 | 9,643,562 | |
Preferred stock, shares authorized (in shares) | 2,000,000 | 2,000,000 | |
Preferred stock, par value (in usd per share) | $ 0.01 | $ 0.01 | |
Preferred stock, issued (in shares) | 0 | 0 | |
Preferred stock, outstanding (in shares) | 0 | 0 | |
Share repurchase program, number of additional common stock authorized to be repurchased (in shares) | 1,000,000 | ||
Share repurchase program, number of additional common stock authorized to be repurchased (in shares) | 11,900,000 | ||
Stock repurchase program, remaining authorized repurchase amount (in shares) | 1,500,000 |
SHAREHOLDERS' EQUITY - Summary
SHAREHOLDERS' EQUITY - Summary of Stock Repurchase Activity (Details) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 30, 2016 | Jan. 01, 2016 | |
Stock Repurchase Program [Roll Forward] | |||
Number of Shares Repurchased, Beginning of period (in shares) | 9,643,562 | ||
Cost of Shares Repurchased, for the year | $ 88,305 | $ 177,830 | $ 201,380 |
Number of Shares Repurchased, End of period (in shares) | 10,400,547 | 9,643,562 | |
Treasury Stock | |||
Stock Repurchase Program [Roll Forward] | |||
Number of Shares Repurchased, Beginning of period (in shares) | 9,672,629 | ||
Cost of Shares Repurchased, Beginning of period | $ 608,439 | ||
Average Price Paid per Share, Beginning of period (in usd per share) | $ 62.90 | ||
Number of Shares Repurchased, for the year (in shares) | 767,876 | ||
Cost of Shares Repurchased, for the year | $ 88,305 | $ 177,830 | $ 201,380 |
Average Price Paid per Share, for the year (in usd per share) | $ 115 | ||
Number of Shares Repurchased, End of period (in shares) | 10,440,505 | 9,672,629 | |
Cost of Shares Repurchased, End of period | $ 696,744 | $ 608,439 | |
Average Price Paid per Share, End of period (in usd per share) | $ 66.73 | $ 62.90 |
SHAREHOLDERS' EQUITY - Cash Div
SHAREHOLDERS' EQUITY - Cash Dividend Declared (Detail) - $ / shares | Dec. 07, 2017 | Sep. 07, 2017 | May 11, 2017 | Feb. 09, 2017 | Dec. 31, 2017 | Dec. 30, 2016 | Jan. 01, 2016 |
Equity [Abstract] | |||||||
Dividends declared per share of common stock (in usd per share) | $ 0.40 | $ 0.35 | $ 0.35 | $ 0.35 | $ 1.45 | $ 1.25 | $ 1.05 |
SHARE-BASED COMPENSATION - Addi
SHARE-BASED COMPENSATION - Additional Information (Details) - USD ($) $ / shares in Units, $ in Millions | Dec. 31, 2017 | Dec. 31, 2017 | Dec. 30, 2016 | Jan. 01, 2016 |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Stock options outstanding (in shares) | 9,000 | 9,000 | ||
Stock options exercisable (in shares) | 0 | 0 | ||
Outstanding (in usd per share) | $ 18.36 | |||
Options, outstanding, weighted average remaining contractual term | 2 years | |||
Stock options | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Number of shares authorized (in shares) | 6,000,000 | 6,000,000 | ||
Number of shares available for grant | 1,400,000 | 1,400,000 | ||
Stock options outstanding (in shares) | 0 | 0 | 0 | |
Stock options exercisable (in shares) | 0 | 0 | 0 | |
Grants in period (in shares) | 0 | 0 | 0 | |
Restricted stock units | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Weighted average grant date fair value (in usd per share) | $ 95.12 | |||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Vested in Period, Fair Value | $ 18.2 | |||
Aggregate intrinsic value, vested | $ 13.2 | $ 30 | ||
SARs | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Weighted average grant date fair value (in usd per share) | $ 27.63 | $ 16.12 | $ 29.75 | |
Aggregate intrinsic value, vested | $ 6.2 | $ 1.4 | $ 4.7 | |
Aggregate intrinsic value, exercised | $ 18.7 | $ 5.6 | $ 4.3 | |
Employee Stock Purchase Plan | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Number of shares authorized (in shares) | 500,000 | 500,000 | ||
Percentage of fair market value of common stock (not less than) | 95.00% | |||
Employees and Non Employee Directors | Restricted stock units | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Weighted average grant date fair value (in usd per share) | $ 53.56 | $ 75.61 |
SHARE-BASED COMPENSATION - Shar
SHARE-BASED COMPENSATION - Share-based Compensation Expense (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 30, 2016 | Jan. 01, 2016 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Share-based compensation expense | $ 16,286 | $ 13,949 | $ 14,142 |
Service based RSUs | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Share-based compensation expense | 10,147 | 9,372 | 8,879 |
Performance based RSUs | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Share-based compensation expense | 3,752 | 2,502 | 3,343 |
Restricted stock units | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Share-based compensation expense | 13,899 | 11,874 | 12,222 |
SARs | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Share-based compensation expense | 2,387 | 2,075 | 1,920 |
Stock options | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Share-based compensation expense | $ 0 | $ 0 | $ 0 |
SHARE-BASED COMPENSATION - Defe
SHARE-BASED COMPENSATION - Deferred Compensation Costs (Details) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 30, 2016 |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Deferred compensation costs related to unvested awards | $ 14,669 | $ 13,453 |
Outstanding, weighted average remaining contractual terms | 1 year 9 months 18 days | |
Deferred compensation expense weighted average expected recognition period | 2 years 4 months 24 days | |
Service based RSUs | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Deferred compensation costs related to unvested awards | $ 8,918 | 9,000 |
Performance based RSUs | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Deferred compensation costs related to unvested awards | 4,752 | 3,307 |
Restricted stock units | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Deferred compensation costs related to unvested awards | 13,670 | 12,307 |
SARs | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Deferred compensation costs related to unvested awards | $ 999 | 1,146 |
Outstanding, weighted average remaining contractual terms | 4 years 7 months 6 days | |
Stock options | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Deferred compensation costs related to unvested awards | $ 0 | $ 0 |
SHARE-BASED COMPENSATION - Chan
SHARE-BASED COMPENSATION - Changes in Marriott Vacations Worldwide RSUs Issued to Marriott International and Marriott Vacations Worldwide Employees (Details) | 12 Months Ended |
Dec. 31, 2017$ / sharesshares | |
Service based RSUs | |
Number of RSUs | |
Outstanding at beginning of year (in shares) | shares | 514,947 |
Stock awards, grants in period (in shares) | shares | 115,334 |
Stock awards, distributed in period (in shares) | shares | (152,783) |
Stock awards, forfeited in period (in shares) | shares | (6,491) |
Outstanding at year-end (in shares) | shares | 471,007 |
Weighted Average Grant-Date Fair Value Per RSU | |
Outstanding at beginning of year (in usd per share) | $ / shares | $ 49.36 |
Granted (in usd per share) | $ / shares | 96.53 |
Distributed (in usd per share) | $ / shares | 51.88 |
Forfeited (in usd per share) | $ / shares | 74.47 |
Outstanding at year-end (in usd per share) | $ / shares | $ 59.49 |
Performance based RSUs | |
Number of RSUs | |
Outstanding at beginning of year (in shares) | shares | 279,284 |
Stock awards, grants in period (in shares) | shares | 94,436 |
Stock awards, distributed in period (in shares) | shares | (50,978) |
Stock awards, forfeited in period (in shares) | shares | (11,230) |
Outstanding at year-end (in shares) | shares | 311,512 |
Weighted Average Grant-Date Fair Value Per RSU | |
Outstanding at beginning of year (in usd per share) | $ / shares | $ 61.30 |
Granted (in usd per share) | $ / shares | 93.41 |
Distributed (in usd per share) | $ / shares | 52.09 |
Forfeited (in usd per share) | $ / shares | 52.09 |
Outstanding at year-end (in usd per share) | $ / shares | $ 72.89 |
Restricted stock units | |
Number of RSUs | |
Outstanding at beginning of year (in shares) | shares | 794,231 |
Stock awards, grants in period (in shares) | shares | 209,770 |
Stock awards, distributed in period (in shares) | shares | (203,761) |
Stock awards, forfeited in period (in shares) | shares | (17,721) |
Outstanding at year-end (in shares) | shares | 782,519 |
Weighted Average Grant-Date Fair Value Per RSU | |
Outstanding at beginning of year (in usd per share) | $ / shares | $ 53.56 |
Granted (in usd per share) | $ / shares | 95.12 |
Distributed (in usd per share) | $ / shares | 51.93 |
Forfeited (in usd per share) | $ / shares | 60.28 |
Outstanding at year-end (in usd per share) | $ / shares | $ 64.83 |
SHARE-BASED COMPENSATION - Ch87
SHARE-BASED COMPENSATION - Changes in Outstanding Marriott Vacations Worldwide SARs Issued to Both Marriott International and Marriott Vacations Worldwide Employees and Directors (Details) $ / shares in Units, $ in Millions | Dec. 31, 2017USD ($)$ / sharesshares | Dec. 31, 2017USD ($)$ / sharesshares |
Weighted Average Exercise Price Per SAR | ||
Outstanding, weighted average remaining contractual terms | 1 year 9 months 18 days | |
SARs | ||
Number of SARs | ||
Outstanding at beginning of year (in shares) | shares | 781,903 | |
Granted during 2016 (in shares) | shares | 81,977 | |
Exercised (in shares) | shares | (205,427) | |
Forfeited during 2016 (in shares) | shares | 0 | |
Outstanding at year-end (in shares) | shares | 658,453 | 658,453 |
Weighted Average Exercise Price Per SAR | ||
Outstanding at beginning of year (in usd per share) | $ / shares | $ 34.97 | |
Granted (in usd per share) | $ / shares | 97.53 | |
Exercised (in usd per share) | $ / shares | 19.35 | |
Forfeited (in usd per share) | $ / shares | 0 | |
Outstanding at year-end (in usd per share) | $ / shares | $ 47.63 | $ 47.63 |
Intrinsic value, outstanding | $ | $ 58.3 | $ 58.3 |
Outstanding, weighted average remaining contractual life | 5 years 10 months 24 days | |
Exercisable (in shares) | shares | 431,543 | 431,543 |
Exercisable, weighted average value (in usd per share) | $ / shares | $ 32.62 | |
Aggregate intrinsic value, exercisable | $ | $ 44.7 | $ 44.7 |
Outstanding, weighted average remaining contractual terms | 4 years 7 months 6 days |
SHARE-BASED COMPENSATION - Assu
SHARE-BASED COMPENSATION - Assumptions Used to Estimate Fair Value of Grants (Detail) | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 30, 2016 | Jan. 02, 2015 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |||
Expected volatility | 30.41% | 31.60% | 42.74% |
Dividend yield | 1.44% | 1.96% | 1.26% |
Risk-free rate | 2.06% | 1.41% | 1.74% |
Expected term (in years) | 6 years 3 months | 6 years 3 months | 6 years 3 months |
VARIABLE INTEREST ENTITIES - Cl
VARIABLE INTEREST ENTITIES - Classifications of Consolidated VIE Assets and Liabilities (Details) - Variable Interest Entity $ in Thousands | Dec. 31, 2017USD ($) |
Variable Interest Entity [Line Items] | |
VIE Assets | $ 853,291 |
VIE Liabilities | 845,832 |
Non-Recourse Debt | |
Variable Interest Entity [Line Items] | |
VIE Liabilities | 845,131 |
Vacation Ownership Notes Receivable Securitizations | |
Variable Interest Entity [Line Items] | |
VIE Assets | 853,287 |
VIE Liabilities | 845,782 |
Vacation Ownership Notes Receivable Securitizations | Non-Recourse Debt | |
Variable Interest Entity [Line Items] | |
VIE Liabilities | 845,131 |
Warehouse Credit Facility | |
Variable Interest Entity [Line Items] | |
VIE Assets | 4 |
VIE Liabilities | 50 |
Warehouse Credit Facility | Non-Recourse Debt | |
Variable Interest Entity [Line Items] | |
VIE Liabilities | 0 |
Vacation ownership notes receivable, net of reserves | |
Variable Interest Entity [Line Items] | |
VIE Assets | 815,331 |
Vacation ownership notes receivable, net of reserves | Vacation Ownership Notes Receivable Securitizations | |
Variable Interest Entity [Line Items] | |
VIE Assets | 815,331 |
Vacation ownership notes receivable, net of reserves | Warehouse Credit Facility | |
Variable Interest Entity [Line Items] | |
VIE Assets | 0 |
Interest receivable | |
Variable Interest Entity [Line Items] | |
VIE Assets | 5,639 |
Interest receivable | Vacation Ownership Notes Receivable Securitizations | |
Variable Interest Entity [Line Items] | |
VIE Assets | 5,639 |
Interest receivable | Warehouse Credit Facility | |
Variable Interest Entity [Line Items] | |
VIE Assets | 0 |
Restricted cash | |
Variable Interest Entity [Line Items] | |
VIE Assets | 32,321 |
Restricted cash | Vacation Ownership Notes Receivable Securitizations | |
Variable Interest Entity [Line Items] | |
VIE Assets | 32,317 |
Restricted cash | Warehouse Credit Facility | |
Variable Interest Entity [Line Items] | |
VIE Assets | 4 |
Interest payable | |
Variable Interest Entity [Line Items] | |
VIE Liabilities | 701 |
Interest payable | Vacation Ownership Notes Receivable Securitizations | |
Variable Interest Entity [Line Items] | |
VIE Liabilities | 651 |
Interest payable | Warehouse Credit Facility | |
Variable Interest Entity [Line Items] | |
VIE Liabilities | $ 50 |
VARIABLE INTEREST ENTITIES - Ad
VARIABLE INTEREST ENTITIES - Additional Information (Details) | 12 Months Ended | |||
Dec. 31, 2017USD ($) | Dec. 30, 2016USD ($) | Jan. 01, 2016USD ($) | Jun. 30, 2017Unit | |
Variable Interest Entity [Line Items] | ||||
Noncontrolling interest | $ 0 | |||
Voluntary repurchase of defaulted notes receivable | 28,300,000 | $ 30,300,000 | $ 24,600,000 | |
Voluntary repurchase of other non-defaulted notes receivable | 57,400,000 | 144,100,000 | $ 146,200,000 | |
Aggregate funding that could be required above the overcollateralization | 5,000,000 | |||
Inventory | 716,533,000 | 712,536,000 | ||
Other assets | 172,516,000 | 128,935,000 | ||
Other | 13,155,000 | $ 15,873,000 | ||
Variable Interest Entity, Not Primary Beneficiary | ||||
Variable Interest Entity [Line Items] | ||||
Notes receivable | $ 500,000 | |||
Minimum | ||||
Variable Interest Entity [Line Items] | ||||
Limit to repurchasing defaulted mortgage notes at the outstanding principal balance | 15.00% | |||
Maximum | ||||
Variable Interest Entity [Line Items] | ||||
Limit to repurchasing defaulted mortgage notes at the outstanding principal balance | 20.00% | |||
New York City | Variable Interest Entity, Not Primary Beneficiary | ||||
Variable Interest Entity [Line Items] | ||||
Capital leases, lessor balance sheet | $ 8,300,000 | |||
Maximum loss exposure, amount (less than) | 2,300,000 | |||
Other Operating Leases | New York City | ||||
Variable Interest Entity [Line Items] | ||||
Minimum lease payments | 7,200,000 | |||
Marco Island, Florida | ||||
Variable Interest Entity [Line Items] | ||||
Number of vacation ownership units acquired | Unit | 36 | |||
Marco Island, Florida | Florida | Variable Interest Entity, Not Primary Beneficiary | ||||
Variable Interest Entity [Line Items] | ||||
Notes receivable | 500,000 | |||
Maximum loss exposure, amount (less than) | 1,000,000 | |||
Inventory | 3,700,000 | |||
Other assets | 2,400,000 | |||
Other | $ 7,500,000 |
VARIABLE INTEREST ENTITIES - In
VARIABLE INTEREST ENTITIES - Interest Income and Expense Recognized as a Result of Our Involvement with Variable Interest Entities (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 30, 2016 | Jan. 01, 2016 | |
Variable Interest Entity [Line Items] | |||
Interest income | $ 127,983 | $ 120,113 | $ 118,020 |
Administrative expenses | 110,225 | $ 104,833 | $ 106,104 |
Variable Interest Entity | |||
Variable Interest Entity [Line Items] | |||
Interest income | 101,193 | ||
Interest expense to investors | 20,548 | ||
Debt issuance cost amortization | 4,669 | ||
Administrative expenses | 562 | ||
Variable Interest Entity | Vacation Ownership Notes Receivable Securitizations | |||
Variable Interest Entity [Line Items] | |||
Interest income | 98,862 | ||
Interest expense to investors | 18,872 | ||
Debt issuance cost amortization | 3,731 | ||
Administrative expenses | 409 | ||
Variable Interest Entity | Warehouse Credit Facility | |||
Variable Interest Entity [Line Items] | |||
Interest income | 2,331 | ||
Interest expense to investors | 1,676 | ||
Debt issuance cost amortization | 938 | ||
Administrative expenses | $ 153 |
VARIABLE INTEREST ENTITIES - Ca
VARIABLE INTEREST ENTITIES - Cash Flows Between Company and Variable Interest Entities (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | ||
Sep. 30, 2017 | Dec. 31, 2017 | Dec. 30, 2016 | Jan. 01, 2016 | |
Cash Inflows | ||||
Net proceeds from vacation ownership notes receivable securitizations | $ 350,000 | |||
Cash Outflows | ||||
Voluntary repurchases of defaulted vacation ownership notes receivable | $ (28,300) | $ (30,300) | $ (24,600) | |
Vacation Ownership Notes Receivable Securitizations | ||||
Cash Inflows | ||||
Net proceeds from vacation ownership notes receivable securitizations | 346,469 | 247,453 | ||
Principal receipts | 228,723 | 174,830 | ||
Interest receipts | 99,766 | 91,972 | ||
Reserve release | 757 | 50,733 | ||
Total | 675,715 | 564,988 | ||
Cash Outflows | ||||
Principal to investors | (214,907) | (166,652) | ||
Voluntary repurchases of defaulted vacation ownership notes receivable | (28,324) | (29,590) | ||
Interest to investors | (18,630) | (17,449) | ||
Funding of restricted cash | (1,804) | (51,770) | ||
Total | (263,665) | (265,461) | ||
Net Cash Flows | 412,050 | 299,527 | ||
Warehouse Credit Facility | ||||
Cash Inflows | ||||
Net proceeds from vacation ownership notes receivable securitizations | 50,260 | 126,622 | ||
Principal receipts | 1,403 | 5,227 | ||
Interest receipts | 2,093 | 5,048 | ||
Reserve release | 296 | 909 | ||
Total | 54,052 | 137,806 | ||
Cash Outflows | ||||
Principal to investors | (1,160) | (3,771) | ||
Voluntary repurchases of defaulted vacation ownership notes receivable | 0 | (661) | ||
Repayment of Warehouse Credit Facility | (49,100) | (122,190) | ||
Interest to investors | (1,672) | (1,796) | ||
Funding of restricted cash | (296) | (447) | ||
Total | (52,228) | (128,865) | ||
Net Cash Flows | $ 1,824 | $ 8,941 |
BUSINESS SEGMENTS - Additional
BUSINESS SEGMENTS - Additional Information (Details) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017USD ($)Segmentprogram | Dec. 30, 2016USD ($) | Jan. 01, 2016USD ($) | |
Segment Reporting Disclosure [Line Items] | |||
Number of business segments | Segment | 3 | ||
Property and equipment | $ 252,727 | $ 202,802 | |
Non-US | |||
Segment Reporting Disclosure [Line Items] | |||
Revenues, excluding cost reimbursements | 191,800 | 195,400 | $ 218,300 |
Property and equipment | $ 77,300 | $ 60,000 | |
Asia Pacific | |||
Segment Reporting Disclosure [Line Items] | |||
Number of points based programs | program | 2 |
BUSINESS SEGMENTS - Revenues (D
BUSINESS SEGMENTS - Revenues (Details) - USD ($) $ in Thousands | 3 Months Ended | 4 Months Ended | 12 Months Ended | ||||||||
Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Sep. 09, 2016 | Jun. 17, 2016 | Mar. 25, 2016 | Dec. 30, 2016 | Dec. 31, 2017 | Dec. 30, 2016 | Jan. 01, 2016 | |
Segment Reporting, Revenue Reconciling Item [Line Items] | |||||||||||
TOTAL REVENUES | $ 481,216 | $ 486,990 | $ 497,620 | $ 486,119 | $ 401,637 | $ 423,171 | $ 419,122 | $ 564,556 | $ 1,951,945 | $ 1,808,486 | $ 1,810,795 |
Operating Segments | |||||||||||
Segment Reporting, Revenue Reconciling Item [Line Items] | |||||||||||
TOTAL REVENUES | 1,951,945 | 1,808,486 | 1,810,795 | ||||||||
Operating Segments | North America | |||||||||||
Segment Reporting, Revenue Reconciling Item [Line Items] | |||||||||||
TOTAL REVENUES | 1,777,345 | 1,627,916 | 1,605,102 | ||||||||
Operating Segments | Asia Pacific | |||||||||||
Segment Reporting, Revenue Reconciling Item [Line Items] | |||||||||||
TOTAL REVENUES | 67,773 | 74,949 | 93,632 | ||||||||
Operating Segments | Europe | |||||||||||
Segment Reporting, Revenue Reconciling Item [Line Items] | |||||||||||
TOTAL REVENUES | 106,827 | 105,621 | 112,061 | ||||||||
Corporate and other | |||||||||||
Segment Reporting, Revenue Reconciling Item [Line Items] | |||||||||||
TOTAL REVENUES | $ 0 | $ 0 | $ 0 |
BUSINESS SEGMENTS - Net Income
BUSINESS SEGMENTS - Net Income (Details) - USD ($) $ in Thousands | 3 Months Ended | 4 Months Ended | 12 Months Ended | ||||||||
Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Sep. 09, 2016 | Jun. 17, 2016 | Mar. 25, 2016 | Dec. 30, 2016 | Dec. 31, 2017 | Dec. 30, 2016 | Jan. 01, 2016 | |
Segment Reporting, Reconciliation of Net Income (Loss) Segment to Consolidated [Line Items] | |||||||||||
Segment financial results | $ 225,883 | $ 222,928 | $ 206,497 | ||||||||
Benefit (provision) for income taxes | 895 | (85,580) | (83,698) | ||||||||
NET INCOME | $ 108,040 | $ 40,762 | $ 44,276 | $ 33,700 | $ 26,807 | $ 36,309 | $ 24,408 | $ 49,824 | 226,778 | 137,348 | 122,799 |
Operating Segments | |||||||||||
Segment Reporting, Reconciliation of Net Income (Loss) Segment to Consolidated [Line Items] | |||||||||||
Segment financial results | 441,583 | 436,679 | 430,733 | ||||||||
Operating Segments | North America | |||||||||||
Segment Reporting, Reconciliation of Net Income (Loss) Segment to Consolidated [Line Items] | |||||||||||
Segment financial results | 427,873 | 423,334 | 409,596 | ||||||||
Operating Segments | Asia Pacific | |||||||||||
Segment Reporting, Reconciliation of Net Income (Loss) Segment to Consolidated [Line Items] | |||||||||||
Segment financial results | (968) | 1,278 | 7,263 | ||||||||
Operating Segments | Europe | |||||||||||
Segment Reporting, Reconciliation of Net Income (Loss) Segment to Consolidated [Line Items] | |||||||||||
Segment financial results | 14,678 | 12,067 | 13,874 | ||||||||
Corporate and other | |||||||||||
Segment Reporting, Reconciliation of Net Income (Loss) Segment to Consolidated [Line Items] | |||||||||||
Segment financial results | $ (215,700) | $ (213,751) | $ (224,236) |
BUSINESS SEGMENTS - Depreciatio
BUSINESS SEGMENTS - Depreciation (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 30, 2016 | Jan. 01, 2016 | |
Reconciliation of Depreciation by Segment [Line Items] | |||
Depreciation | $ 21,494 | $ 21,044 | $ 22,217 |
Operating Segments | |||
Reconciliation of Depreciation by Segment [Line Items] | |||
Depreciation | 15,057 | 14,743 | 16,960 |
Operating Segments | North America | |||
Reconciliation of Depreciation by Segment [Line Items] | |||
Depreciation | 12,869 | 12,046 | 12,935 |
Operating Segments | Asia Pacific | |||
Reconciliation of Depreciation by Segment [Line Items] | |||
Depreciation | 880 | 1,235 | 2,424 |
Operating Segments | Europe | |||
Reconciliation of Depreciation by Segment [Line Items] | |||
Depreciation | 1,308 | 1,462 | 1,601 |
Corporate and other | |||
Reconciliation of Depreciation by Segment [Line Items] | |||
Depreciation | $ 6,437 | $ 6,301 | $ 5,257 |
BUSINESS SEGMENTS - Assets (Det
BUSINESS SEGMENTS - Assets (Details) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 30, 2016 |
Segment Reporting Information [Line Items] | ||
Total Assets | $ 2,906,193 | $ 2,391,419 |
Operating Segments | ||
Segment Reporting Information [Line Items] | ||
Total Assets | 2,343,138 | 2,132,614 |
Operating Segments | North America | ||
Segment Reporting Information [Line Items] | ||
Total Assets | 2,143,664 | 1,968,021 |
Operating Segments | Asia Pacific | ||
Segment Reporting Information [Line Items] | ||
Total Assets | 134,939 | 102,348 |
Operating Segments | Europe | ||
Segment Reporting Information [Line Items] | ||
Total Assets | 64,535 | 62,245 |
Corporate and other | ||
Segment Reporting Information [Line Items] | ||
Total Assets | $ 563,055 | $ 258,805 |
BUSINESS SEGMENTS - Capital Exp
BUSINESS SEGMENTS - Capital Expenditures (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 30, 2016 | Jan. 01, 2016 | |
Segment Reporting, Other Significant Reconciling Item [Line Items] | |||
Capital Expenditures | $ 181,487 | $ 172,730 | $ 264,860 |
Operating Segments | |||
Segment Reporting, Other Significant Reconciling Item [Line Items] | |||
Capital Expenditures | 174,419 | 164,318 | 254,600 |
Operating Segments | North America | |||
Segment Reporting, Other Significant Reconciling Item [Line Items] | |||
Capital Expenditures | 142,897 | 136,889 | 179,696 |
Operating Segments | Asia Pacific | |||
Segment Reporting, Other Significant Reconciling Item [Line Items] | |||
Capital Expenditures | 26,475 | 21,276 | 72,097 |
Operating Segments | Europe | |||
Segment Reporting, Other Significant Reconciling Item [Line Items] | |||
Capital Expenditures | 5,047 | 6,153 | 2,807 |
Corporate and other | |||
Segment Reporting, Other Significant Reconciling Item [Line Items] | |||
Capital Expenditures | $ 7,068 | $ 8,412 | $ 10,260 |
QUARTERLY RESULTS (UNAUDITED)99
QUARTERLY RESULTS (UNAUDITED) (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 4 Months Ended | 12 Months Ended | ||||||||
Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Sep. 09, 2016 | Jun. 17, 2016 | Mar. 25, 2016 | Dec. 30, 2016 | Dec. 31, 2017 | Dec. 30, 2016 | Jan. 01, 2016 | |
Quarterly Financial Information Disclosure [Abstract] | |||||||||||
Revenues | $ 481,216 | $ 486,990 | $ 497,620 | $ 486,119 | $ 401,637 | $ 423,171 | $ 419,122 | $ 564,556 | $ 1,951,945 | $ 1,808,486 | $ 1,810,795 |
Expenses | (429,604) | (428,300) | (430,204) | (432,555) | (358,906) | (368,674) | (374,440) | (481,195) | (1,720,663) | (1,583,215) | (1,592,792) |
Net income | $ 108,040 | $ 40,762 | $ 44,276 | $ 33,700 | $ 26,807 | $ 36,309 | $ 24,408 | $ 49,824 | $ 226,778 | $ 137,348 | $ 122,799 |
Basic earnings per share (in usd per share) | $ 4.05 | $ 1.50 | $ 1.62 | $ 1.24 | $ 0.99 | $ 1.28 | $ 0.84 | $ 1.83 | $ 8.38 | $ 4.93 | $ 3.90 |
Diluted earnings per share (in usd per share) | $ 3.95 | $ 1.47 | $ 1.58 | $ 1.21 | $ 0.97 | $ 1.26 | $ 0.82 | $ 1.80 | $ 8.18 | $ 4.83 | $ 3.82 |
SUBSEQUENT EVENTS (Details)
SUBSEQUENT EVENTS (Details) - $ / shares | Feb. 16, 2018 | Dec. 07, 2017 | Sep. 07, 2017 | May 11, 2017 | Feb. 09, 2017 | Dec. 31, 2017 | Dec. 30, 2016 | Jan. 01, 2016 |
Subsequent Event [Line Items] | ||||||||
Dividends declared per share of common stock (in usd per share) | $ 0.40 | $ 0.35 | $ 0.35 | $ 0.35 | $ 1.45 | $ 1.25 | $ 1.05 | |
Subsequent Event | ||||||||
Subsequent Event [Line Items] | ||||||||
Dividends declared per share of common stock (in usd per share) | $ 0.40 |
ADOPTION OF ASC 606 EFFECTIV101
ADOPTION OF ASC 606 EFFECTIVE JANUARY 1, 2018 (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 4 Months Ended | 12 Months Ended | ||||||||
Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Sep. 09, 2016 | Jun. 17, 2016 | Mar. 25, 2016 | Dec. 30, 2016 | Dec. 31, 2017 | Dec. 30, 2016 | Jan. 01, 2016 | |
REVENUES | |||||||||||
Sale of vacation ownership products | $ 727,940 | $ 637,503 | $ 675,329 | ||||||||
Resort management and other services | 306,196 | 300,821 | 292,561 | ||||||||
Financing | 134,906 | 126,126 | 124,033 | ||||||||
Rental | 322,902 | 312,071 | 312,997 | ||||||||
Cost reimbursements | 460,001 | 431,965 | 405,875 | ||||||||
TOTAL REVENUES | $ 481,216 | $ 486,990 | $ 497,620 | $ 486,119 | $ 401,637 | $ 423,171 | $ 419,122 | $ 564,556 | 1,951,945 | 1,808,486 | 1,810,795 |
EXPENSES | |||||||||||
Cost of vacation ownership products | 177,813 | 155,093 | 204,299 | ||||||||
Marketing and sales | 408,715 | 353,295 | 330,599 | ||||||||
Resort management and other services | 172,137 | 174,311 | 180,072 | ||||||||
Financing | 17,951 | 18,631 | 21,208 | ||||||||
Rental | 281,352 | 260,752 | 259,729 | ||||||||
Administrative expenses | 110,225 | 104,833 | 106,104 | ||||||||
Litigation settlement | 4,231 | (303) | (232) | ||||||||
Consumer financing interest | 25,217 | 23,685 | 24,658 | ||||||||
Royalty fee | 63,021 | 60,953 | 58,982 | ||||||||
Cost reimbursements | 460,001 | 431,965 | 405,875 | ||||||||
TOTAL EXPENSES | 429,604 | 428,300 | 430,204 | 432,555 | 358,906 | 368,674 | 374,440 | 481,195 | 1,720,663 | 1,583,215 | 1,592,792 |
Gains and other income, net | 5,772 | 11,201 | 9,557 | ||||||||
Interest expense | (9,572) | (8,912) | (12,810) | ||||||||
Other | (1,599) | (4,632) | (8,253) | ||||||||
INCOME BEFORE INCOME TAXES | 225,883 | 222,928 | 206,497 | ||||||||
Benefit (provision) for income taxes | 895 | (85,580) | (83,698) | ||||||||
Net income | $ 108,040 | $ 40,762 | $ 44,276 | $ 33,700 | $ 26,807 | $ 36,309 | $ 24,408 | $ 49,824 | $ 226,778 | $ 137,348 | $ 122,799 |
Basic earnings per share (in usd per share) | $ 4.05 | $ 1.50 | $ 1.62 | $ 1.24 | $ 0.99 | $ 1.28 | $ 0.84 | $ 1.83 | $ 8.38 | $ 4.93 | $ 3.90 |
Diluted earnings per share (in usd per share) | $ 3.95 | $ 1.47 | $ 1.58 | $ 1.21 | $ 0.97 | $ 1.26 | $ 0.82 | $ 1.80 | $ 8.18 | $ 4.83 | $ 3.82 |
Accounting Standards Update 2014-09 | Pro Forma | |||||||||||
REVENUES | |||||||||||
Sale of vacation ownership products | $ 29,498 | $ (15,078) | |||||||||
Resort management and other services | (27,358) | (23,285) | |||||||||
Financing | 0 | 881 | |||||||||
Rental | (60,863) | (59,707) | |||||||||
Cost reimbursements | 289,601 | 288,507 | |||||||||
TOTAL REVENUES | 230,878 | 191,318 | |||||||||
EXPENSES | |||||||||||
Cost of vacation ownership products | 17,034 | 7,850 | |||||||||
Marketing and sales | (13,825) | (13,682) | |||||||||
Resort management and other services | (17,913) | (17,576) | |||||||||
Financing | 0 | 135 | |||||||||
Rental | (57,970) | (49,186) | |||||||||
Administrative expenses | 0 | 0 | |||||||||
Litigation settlement | 0 | 0 | |||||||||
Consumer financing interest | 0 | 0 | |||||||||
Royalty fee | 0 | 0 | |||||||||
Cost reimbursements | 289,601 | 288,507 | |||||||||
TOTAL EXPENSES | 216,927 | 216,048 | |||||||||
Gains and other income, net | 0 | 0 | |||||||||
Interest expense | 0 | 0 | |||||||||
Other | 0 | 0 | |||||||||
INCOME BEFORE INCOME TAXES | 13,951 | (24,730) | |||||||||
Benefit (provision) for income taxes | (5,405) | 9,320 | |||||||||
Net income | $ 8,546 | $ (15,410) | |||||||||
Basic earnings per share (in usd per share) | $ 0.32 | $ (0.56) | |||||||||
Diluted earnings per share (in usd per share) | $ 0.31 | $ (0.54) | |||||||||
Accounting Standards Update 2014-09 | Pro Forma | |||||||||||
REVENUES | |||||||||||
Sale of vacation ownership products | $ 757,438 | $ 622,425 | |||||||||
Resort management and other services | 278,838 | 277,536 | |||||||||
Financing | 134,906 | 127,007 | |||||||||
Rental | 262,039 | 252,364 | |||||||||
Cost reimbursements | 749,602 | 720,472 | |||||||||
TOTAL REVENUES | 2,182,823 | 1,999,804 | |||||||||
EXPENSES | |||||||||||
Cost of vacation ownership products | 194,847 | 162,943 | |||||||||
Marketing and sales | 394,890 | 339,613 | |||||||||
Resort management and other services | 154,224 | 156,735 | |||||||||
Financing | 17,951 | 18,766 | |||||||||
Rental | 223,382 | 211,566 | |||||||||
Administrative expenses | 110,225 | 104,833 | |||||||||
Litigation settlement | 4,231 | (303) | |||||||||
Consumer financing interest | 25,217 | 23,685 | |||||||||
Royalty fee | 63,021 | 60,953 | |||||||||
Cost reimbursements | 749,602 | 720,472 | |||||||||
TOTAL EXPENSES | 1,937,590 | 1,799,263 | |||||||||
Gains and other income, net | 5,772 | 11,201 | |||||||||
Interest expense | (9,572) | (8,912) | |||||||||
Other | (1,599) | (4,632) | |||||||||
INCOME BEFORE INCOME TAXES | 239,834 | 198,198 | |||||||||
Benefit (provision) for income taxes | (4,510) | (76,260) | |||||||||
Net income | $ 235,324 | $ 121,938 | |||||||||
Basic earnings per share (in usd per share) | $ 8.70 | $ 4.37 | |||||||||
Diluted earnings per share (in usd per share) | $ 8.49 | $ 4.29 |