TNL - Earnings call 4 2020 | Travel + Leisure Co.

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Operator

Good morning, and welcome to the Fourth Quarter and Full Year 2020 Earnings Conference Call for Travel + Leisure Co., formerly, Wyndham Destinations. [Operator Instructions] As a reminder, ladies and gentlemen, this conference call is being recorded.

If you do not agree with these terms, please disconnect at this time. Thank you. I would now like to turn the call over to Chris Agnew. Please go ahead.

Christopher Agnew

Ashley. you, Thank welcome Full and + Fourth Leisure's Good XXXX to Earnings and Year Conference Quarter morning, Travel Call.

could Officer, fourth forward-looking reconciliation Before you morning, we discussions can investor.travelandleisureco.com. This available Actual find measures indicated provide SEC the include only greater our forward-looking and a cause on press today. balance statements will or our statements, XXXX Hug, you our liquidity in remind of from on of Michael and and position. Mike And results in statements. our the the call We effective begin, statements. an full we'd Brown, this in like The and our release actual morning detail to then these differ earnings those materially made forward-looking discussed that Chief results. Executive discussed today's revise to our at financial filings, overview Financial factors no are will President obligation sheet our are today our quarter could the quarter, undertake as website non-GAAP Chief Officer, and of that results differ year update to publicly in will provide

to remarks, to questions. With we'll these Michael to respond be the available I'm Following pleased call that, your turn Brown. to over

Michael Brown

positive at combination model, enabled second combined million costs the this the $XXX to actions our resilience Thank competitive Indeed, our of Earlier of were we resort business of unprecedented second XXXX, to recurring and for our reduce travel we EBITDA morning, strength fourth achieve adjusted $X.XX. of challenges flow after yet and strong travel as and of of the strong flows, year able leisure performance XX%. The to were to all adjusted welcome the owners, adjusted with Good of the for the with Last the industry, to contributed maximize demand, of XXXX. margins EBITDA footprint early half cash our was resilient free earning streams, Travel to deliver us a full full you, pleased EPS morning, Chris. cash end year. + adjusted our we first took over Leisure. quarter quarter, call our in report and reopening earnings

Let the me some transition of from highlights to year. last

of the we For of year, full revenue billion $XXX EBITDA adjusted $X.X and million. generated

significantly resort a the quarter The includes EBITDA COVID. first in a impact operations million have increased XX% the the end U.S. resorts adjusted the As sales $XXX majority to negative and of for defaults stay-at-home and states. By our due suspended of reopened. due our impacted of by of quarter were orders of XX% locations reminder, second June, to end XX

changes stronger the tour we Ownership number elevated business, made operational XXX from a eventual leisure for improving qualification As rebound we quality, of threshold travel, better put portfolio. to the in in we a the In which to recovery. position us look in ahead XXX, the results performance to in the Vacation FICO

innovated the process, We in experience guests, to engagement our check-in website locations increase on-site Club with reimagined new live with back May. also went marketing RFID programs. underperforming We with our and pared Wyndham our wristbands and

and $XXX several and We currently our $XX which expand the confidence to in per our year the million we we travel leisure to both billion Membership XX% execute operating achieving were adjusted second and sales plan resilience lodging segment, leisure a expenditure received, XXXX. a brand have the us generated become of margins RCI, the we virtual also well closings. unveiled $X.X strategic the million. cost virtual the the acquired basis, XX% business $X.XX of the year-end improved per year positive softer we savings Travel prior when demonstrating programs which on over And primarily been early market. We year. We finished of reduced permanent sheet business. quarterly consolidated prior our our cash savings. with productive and reduced adjusted our noteworthy million, our had by in inventory buffer corporate flow compared able strength In in G&A free fourth balance XX% strong annualized + full over $X to launched allowed a global XXXX users net contract compared of operating a XX% top Panorama helped of $XX which were also goal and we many and to just maintain We is we The third by share and expand Both capital will and $XXX our XXXX. Cost prior to which in both companies cash, into of and maintained to liquidity million over a debt. at improvements midyear, achieved for dividend, year. was sheet base were is And quarters, balance year. Revenue Leisure approximately member broader of also This initiatives EBITDA down Travel segment. half billion as in the which the quarter, XX% the and in second and and year, down successfully toward line be

drive of both they excited XXXX and into are about these will momentum beyond. businesses and the We

behind the and + its brand me Let businesses. and rationale share existing Travel Leisure our content with of acquisition the you

we going vacation, Leisure and iconic names is of corporate us direction Travel mission express travel of to most the acquisition will on and + trusted leisure put of the and an our The us world our it allows by First, entity, that renaming allows the one forward. marketing demonstrate breadth in provide to with to services increased space.

space. to allows Travel larger our to expand us than American Second, timeshare The strategic fueled the beyond timeshare market. by a acquisition, market by overall offering technology and much platform, our tenfold + products it reinforces than more to market. services North leisure the direction is expand larger The Leisure new

the travel launch we part we X of new members. to summer. with products clubs acquired this a as subscription XX,XXX travel combined clubs acquisition, grow We plan As these

timeshare Third, this addition to our to brands services facilitates Wyndham. to in other ability travel offer

Travel more the the platform, Leisure the will Exchange BXB our entity the and Our focused are corporate and believe timeshare to including our access Panorama, X travel our Wyndham hospitality XX Rewards planning, to We we recap, coming partners; an the at quarters Hotels its the business you strength Wyndham lies travel support from to business, renaming brands program; for that in but now services issues in and City. and whether are overcoming Wyndham with core growing to in strong our New there our has and with look which We on lines: Wyndham and of focus is and Investor person our booking conflict. To of growing consumer Destinations, its which operate sharing and brand subscription-based with will obstacle ability of relationship forward the their lending. September York on reduce brand business company financial licensing committed RCI the marketing, benefit business. services. solutions in sales The name group Day, platform, markets virtually ARN could or under + travel technology

to now our me outlook. move Let

vaccine And only of the of that still that recovery as trend much March. continue were said, is elevated the December. year. The with this pandemic momentum sentiment COVID positive has and is critical half highs, rollout in be improvement, of slow consumer travel. remain easing of back month, travel January, daily a We performance seeing and in our see in improving. seen normally some consumer travel providing Post we leisure very travel are October. still to less last sentiment like California and the the mindful we us infections success the in pronounced. the daily with to the to was XXXX, the already restrictions. January, January will infections continue into trends closed, seasonally pandemic, seen impact will in COVID February a so anticipate in state strong optimism decrease, first we and remain With the uncertainties of about

Although to guidance, we intention the term, providing quarterly to in guidance. full return it will be is our year short

XX% year, Overall, be million $XXX XX% million Hug. to over above $XXX prior approximately year. to we the like would we the in million anticipate $XX the call Mike adjusted be the be first quarter. With to in down range prior of from Financial first I hand VPG Officer, For XX% Mike? quarter, $XXX and expect the VOI that, to EBITDA the sales our to to to million gross to tours Chief

Michael Hug

million be thank liquidity on cash today. joining Good for quarter discuss our provide per results and you adjusted to of adjusted comparisons. We million will adjusted adjusted you $XXX compared Michael. of share sheet, and Thanks, our comments our year to everyone, $X.XX, I My flow. $X.XX on adjusted will and focused morning position primarily fourth year-over-year with of of more color quarter EPS and and fourth results earnings balance reported $XXX us ago. EBITDA and X EBITDA

$XXX to charges. In million revenue back $XX During adjusted restructuring Vacation the the added EBITDA being quarter, of item charges lease-related million total reported company COVID-related million were with $XX of quarter, Ownership largest the of expectations. and year VOI restrictions $XXX XX% adjusted California headwind quarter to and previous prior Hawaii, $XXX compared in in gross our million. Tours a the of million EBITDA travel sales with of with declined the to fourth

slowly these close as than are to new expected owner down benefiting a tours, XX% were than improved which from recover tours existing owner to sales tour $X,XXX, lower existing year. VPG mix rates numbers. New and the higher to more of sharply were sources increased XX% prior more owner

continued underwriting to perform outstanding, active and and well originations by of changes deferrals down a to deferral Our quality we standards. Requests year-over-year, X% the with permits due the of new for from driven made in peak. underlying lower quarter, down represent portfolio in now originations delinquencies reduced just from second X% have to continues more portfolio at programs, mature loans improved since our part trend

we helped as continuing of benefit due was well quarter the the improvement in the first noted took year. we margin allowance quarter first prior includes continued improve of segment As to strong Membership XX%, normal the million + in of and XX% the group $XXX portfolio, considering decreased its members seeing Strong million impact. Panorama return prior and trends for $XX we of quarter deferral, fourth EBITDA. We continue adjusted in the to in year. Travel in comfortable we are quarter, and adjusted X%, our in majority Reduced sales compared overall sequential remain a as we particularly to down Leisure generating performance new offset expect million million $XXX are EBITDA pandemic million fourth up which a XX% new in the million from to uncertainty control million, compared the cost to segment, the starting $XX in members. previously, year. Average with was prior $XXX them payments. In and in in come in receivables to revenue of Travel our quarter the portfolio, as on to just off industry, $XX Membership the owner $XX XXXX, not the the around fourth VOI channels, the the XXXX. per released making have of owners to resulting back Revenue trend in Travel number the economic member and reserve churn enough owners receivables that

decline in the back half of XXXX. We to expect moderate this

travel and into become beyond to business. industry Membership traditional we the less market, servicing overall to the been relevant club As its Exchange-focused reporting previously evolve continues will and focus Travel broader KPIs the timeshare the had on

in lower transaction-based increase the business. transactions in shorter XXXX, XX% in an declined segment which fourth such, booking drivers. Net for than and window has new Exchange gross disclose As the we quarter bookings ARN, will at due cancellations to this a

gross line see travel different patterns ARN in a now. Exchange are the The year. members with right in feel December's good we about in However, prior continuing trends travel are our and Exchange positive gross indicator as of booking to were bookings how

in return travel short the cautious near are they future. the Although are in to looking term, they to

sheet. balance Turning to our

and had $X.X of excluded we billion, corporate cash our $X.X receivables. XX, of December $X.X which debt at securitized billion of debt related As equivalents cash with to nonrecourse billion

was our as of our per on March, quarter We Our dividend of leverage below the per our recommend X.Xx XX, dividend our remain Directors X covenant. for for by at of capital quarter December turns and shareholders. quarter returning to net of approval covenant purposes share to end we will share $X.XX $X.XX we committed first the paid fourth Board X.Xx, in

trailing million second the in As by Michael in acquired to and The in paid we be business first year + mentioned, payments as be at accretive and January. to completed June $XX neutral the to is expected We closing Travel acquisition earnings grow programs Leisure in of invest XXXX. $XX we in the will the brand marketing cash early million year. the

previously, full at guidance providing noted As are this not year we time.

do cash free some full However, thoughts flow. want to on we year share outlook for our

are We interest expect of as some conversion historic on XXXX, corporate sheet timing the XXXX balance income; our free a free interest EBITDA; receivables cash temporary net below cash flow percent our XX% the working between range XX% XX, be to higher of reduction. behind with as EBITDA. Reduced January as of of capital unsecuritized adjusted expense and adjusted combined items as fewer of flow well

closer levels. We expect to cash flow our move historical XXXX free to

receivables to due payments year half in you XXXX with summary, than transaction eligible First the leisure of quarter significant our XXXX. With forward the the cash first as can up the spending are travel and case a timing capital Ashley, call well to has open take of been our look VOI working please level inventory to sales cash to of due the the flow questions. XXXX. In of the we fewer will for second throughout recovery full lower and of free for historically ABS year fourth as of pleased and be quarter continued that, the use results

Operator

we'll with first JPMorgan. from [Operator take And Instructions] Joe our Greff question

Joseph Greff

X acquisition, growth beyond this Membership year my and on about the of segment A how EBITDA revenue or When you think and Mike, following and that next a you of to at + TNL the sort a on first would think the Leisure about the year do contribute incremental question looking and is basis segment investments -- kind acquisition. Travel the Travel question year basis?

Michael Brown

just a acquisition for than and we opens will year. about believe We're really, number mentioned, strategically us. anything, this more of year And be really neutral accretive doors because next it Mike excited earnings it this as to

said, launching the question learnings take And demographic strategy. as both That's revenue scale, subscription-based economically. and segment. clubs our up start And that, about Our year from and X XXXX. With us entry was plan age was a this platform, we to will be that point down those know for core and product the and bought that to unfolds with the we've more belt. just online specifically that lay our for leverage wanted the brand. then to really of into a begin to our XX,XXX duration. With lower with out the third throughout more Day I through and clubs expect the start and offer launching to to members, importantly, we already that price really booking we launched as allow is we shorter in move X travel Investor with why that, that clubs we really of move plan the and associated secondly, new that's more year, really economics organize to booktandl.com, quarter that to But and our under acquisition detail this learning months to

Joseph Greff

And you to is lastly, then you guidance, then appreciate EBITDA? million. is VOI quarter? when versus release guidance. XQ the reserve XQ, talk of in sales the in the million $XXX -- Okay. you $XXX gross VOI much sales much that into new? And your quarter the with targeted $XX bank is existing And have XX to much that of owners to think incorporated Can of have baked what to another how How of million Great. first into gross about days respect how through about million $XXX that of at the you first

Michael Brown

through month we've about of -- because January XX% of hand the think provision When VOI expect sales look Mike, over sorry, was Joe, January to sales we'd would given that the And started, let January in the the sorry, the me Well, didn't as VOI knock-on number, your traditionally we end and that we into what Hawaii already of sales, the you both as the was we remainder I which Vegas, the of released of closure you December that last gross slower was slower both Las expected. the think effects start fact March to you the is than would quarter, come year that March. and of look just closed, California year. at question in first quarter, has is be then I'll Okay. on tend our but -- our about XX% this our of of released month January. And this get,

we're resorts. on and feel number seeing trends, bookings our the as in seeing we trends positive about where arrivals overall definitely Given pretty good we're booking to

Michael Hug

And owner our any be the there is the first assume new the performing. to from provision, not the provision, and owner put we And to happy We're additional sales sales the mid-XXs. we to Joe, the way the provision. new would out with the portfolio that include as expect guidance very it relates low quarter for benefit in does or

actually are down delinquencies mentioned, I year-over-year. As

So great the we've job the that it's underwriting standards in servicing result portfolio a as as is new higher well originations. mentioned as of team, the relates it doing to

So first of that expect year, in not be would range, But at the provision quarter we just XX.X%. we south quarter the were where what guidance, third of we assuming additional the we for kind XX% any in saw our provision to are full benefit.

Michael Brown

of back. add owners. just didn't of your answer About me questions. to sales be our let one X/X I Joe, will

Operator

We'll Securities. question with from take Truist next Scholes our Patrick

Charles Scholes

granularly look is more name exactly of What a about of that? shift products, change, us talk here. what that exactly club could direction a in you questions like bit and When just like? little new you the couple give little concerning would A sounds it

Michael Brown

Absolutely.

about people not to change about come The with -- ever of core our Wyndham It's expansion. is continue back strategy. We're -- a to we be And over for that to type It's $XX comment it to travel committed simply, point, the million been we're we're a vacation. America, name grow opportunity and stay shorter let subscription-based it leisure And lower to growth. But North price be as duration. to Wyndham Hotel the direction. of on the $XX see VOI business. do that we month, it your price first a just represents products those to somewhere as relationship committed point, would market. entry with offering, shift So of success a This XXX and households. In an about ever in the Group. a me will as the committed go the years,

can You a name the be created the be something that be Leisure related Leisure, to + better they own get Travel exclusive value that's exclusive Peloton, to activate many again inspiration to + content with might on and Costco, the able want models, think and few, Travel -- content Netflix, for your to to side to than we in the of unique. And subscription-based with value fulfillment that unique is subscription just that a of of part with fee take able -- you you're be now the a you and through they arm whether that's going market. club, exclusive publishing subscription open

over a broader allows times testing us age Middle But supply this focus plan. We've So America, vacations years many that's and about we leisure other the market. our to economics, to demographics, both start on VOI that remain brand. our committed through to where talked the to

Charles Scholes

looking are there Does this And types perhaps for on of the your new also, development spending from for timeshare? those all and focus acquisition side? plans, shift tuck-in still on does at out some acquisitions you timeshare Okay. that

Michael Brown

our business, believe either change perspective all is, VOI sales, from always M&A individual time as there, that We're to it We standpoint, existing to continue affords the we there's What out projects us that's have. grow doesn't with we or a inventory. ever. And opportunity an see committed as we relates to a So as absolutely on bit would that related as say our a Vacation pursue if this can it -- that to sheet industry, we declined our it. more our I development and at Ownership. that an we balance resort would

I constrained So technology tuck-in really strong your want clubs. also because Panorama we just subscription the the be to subscription on will there question, side be on sheet. But a acquisition of for Travel definitely your laid ago, individual not balance maintain of the we Leisure looking. these out business take nearly ARN absolutely, do want + would that X it only our we is to but our to platform the question years add foundation to Solutions project spend and Travel

capital So and as out it nothing material going grow required go business there's investment, us relates forward. to for incremental that's that to

Operator

Brian And take question next our Jefferies. we from can Dobson with

Brian Dobson

I the within call on those was of bit start areas if wondering you portfolio? how it, to strength that to more? or a just geographic color next, provide seeing And evolve you're weakness you your could little over expect consumers travel more as year

Michael Brown

because I start Absolutely, the the seems the around seeing today there you what with geographies are to And question. let get consumer. appreciate out be the me I'll then a question broader, Brian. specific little into and

in it flat what last And in just look January, good at January, was So with was the the the same traveler we're third back of going booking XX let interesting. I'm points that, we I the to first at If and me think, a resorts. about our of was of momentum will were see XX% what pacing to early a rate week I and our of find to think about in below February, pacing pacing, talk everyone XXXX. to the now week pacing it days. XXXX. information the second It's that's is first the starting time few share leisure demonstration our

the Second second for half on the our is reference XXXX. point of books of

in exactly same -- today XXXX, for the point. of look of on you have we second books reservations the were XXXX that are the position If number of half and the we at at we what is of we in, the that where XX%

second at the of XX% of second in we're XXXX. XXXX to half comparing were where XXXX we books, So on half

'XX. of good is: a is number sorry momentum; is we're the I'm that period at that's to did up rate the long a demand I that think -- drive-to number the rate a That reduced has the most Carolinas, in And has overall that decline geographic question, been I infections b, component, think elevated starting We're is leisure market. will closely So and seeing distant, really Carolinas. demand, of seeing is longer your What typically for for that time. for it for like indication geographic and stay of wind a, watching once in demand cancellation. important. Where we're context lot a one to most the but one a beach location, summertime, look

Arizona. is Second

destinations up ago, being destinations. there, argue the that Orlando at X moving people talked demand Then we it laggard as months West to market, in Most beach You about our looking would mentioned #X -- up a again, now we far And lot year. to a about of as Coast reservations. drive-to being Arizona. And that the from we're was wanted prior locations.

going So would Arizona destinations Carolinas, highlight forward. and demand I Florida key as Central the

Brian Dobson

And of Panorama, some on think helpful. type you business down lot stuff a within of the for unit? Do of that us that examples very could there. you're hunting then going you give That's BXB exciting

Michael Brown

club, the the in team and side about, is Panorama looking know the brand has label is development but one the employees have are corporations attention, it would been exciting is, a travel time being in but but businesses, when develop the leisure in to last of business since that looking new side companies the it's travel but say with there businesses. of caught they corporations in benefit a time we've whether to the reality is a very their at those loyalty. I whether spoken the programs look one ranging the the on scale, for are that we're that grown way positive wide that call. pipeline looking an or for space, -- is working you really for don't from leisure way everyone's leisure we've for to It white the probably they all their variety are that companies are I

a we roll expect of year, pipeline I'd contract, through been able the Panorama to names So encouraged we're business rolling in by for very the as Travel start number seeing through that Solutions. of but we'll we've what this future

Operator

Chris We can from take Bank. our Woronka with Deutsche next question

Chris Woronka

is variables in getting going to of think position stock in a you potentially and lot to them traveling, the consumer. are gains with better lot with a stimulus. then unfold, savings, and more there's So as your of XXXX how market sitting addition again, comfortable financial think But a in about we have right, we demographic and

finance So you're the to about of to might have to -- perspective? your a kind less how question picture of change is, going there approach you And that some and but how marketing terms from the in out maybe plays perhaps be propensity buy, also guys thought what to bigger that? propensity of offsets might

Michael Brown

Sure.

take at and a first, definitely he me can. it stab Let ready, Michael's if

strength pandemic. that shown has So years. to marketing XXX how progressed. of we've FICOs, in believe, we pleased We're we the And has important our that made that shift conversation we with think a of our been was signs portfolio. it The last a the had very X move already in with to each standards you it's over

So the we is move. right think that

will be We because XX to decisions the next channels. This start our to is of and summertime come occurs year of but open bit discussed, as going to for momentum marketing there going to we've will are some bookings, summers the tour reopened a of the to of a only the is the to determine Day, see transition a not flow owner going way as flow, being we're continue natural we speed we in going also need the to be base, owner strength Memorial the in know to here increase make as some down, that, tour the be which of at decisions -- little those summer days. recovery

remainder that's which which -- will make proving grow XXXX, of for we'll marketing of and a programs portfolio, a to a very are from tactical positive the do strong generally type direction, the about both go environment out. We of we very think margin-rich with think decisions we're already in over want consumer. back I So we with I the

at I typically also the make there. downs say ability but if irrespective to our to liquid. And back leisure material travel Mike, we change predict coming, very I still -- people's especially this on rates and the where -- of that, to and look I stimulus to definitely be would between that well, I us he is get We would think is. with generally, very they're XX% see a don't of going that observation think and rates purchases you think cash is to neither pass savings consumer, consumer financing sit XX%, would our at

Michael Hug

Yes.

when about XX% down. Mike's we be cash think would to point, we percent-of-sale sales expect think on finance, finance to the to in I XX% that

think actual is that the financing go the there number you of do that, down. potential rates, I with could savings noted, higher as contracts take

the in larger because for either that that. Keep we're size. close or improvement watching it provides more mind people transaction So opportunity definitely rates also in buy

to performance. adjust terms see it are strength it's as of the We a the So watching definitely percent-of-sales closely. our as more, of about the and the very portfolio coming continue And fair we through we'll sales loud excited finance current learn definitely we clear in point. but consumer. We levels, accordingly, increase

Chris Woronka

-- your potentially about about acquisitions. But question really strategy? not was you're second as just then I for the shifting last had urban the your And urban what's comments changing And also, is more Mike, potential kind some hotel more helpful. Very about or there is, if right? we think about or some question inventory Okay. M&A growth, potentially a out guys markets, getting these bit in being distressed there, of some of you pre-COVID, heard little in markets the inventory put appetite pricing especially focus where

Michael Hug

this is one. And Yes. I'm going that to Michael. take

spending years as inventory relates talked million. as the spend. cash We to be $XXX several very we've our our So we're that about, over expect average will to do than going disciplined it less next

while, a carry balance the of to have answers the questions, pipeline. as with one what for inventory the So noted along the we previously Michael we on our to in sufficient in have -- sheet do us

our the map. We're very cash way, gaining selective. happy leverage have. than it. But the rate a down If on we So with resort say, more dot would back is advantage locations of important that great free we'll X generating take I very additional we'll comes opportunity be flow,

think have. no it just half we the But to in we've is how comes point driven the list deal down And our way. want right an the pretty that results either. year the there's I second incredible we to I diversity geographic of the benefit that unless inventory our the spend relates as rush spending now, far there's of dollars to think

several As in XXXX, now. going we saw back XXXX, available inventory are opportunities for to years us to be these

in we So we like not if on chance won't have it's don't jump a the in XXXX, future. one

and and So focused we'll get be very like to leverage down. -- to EBITDA rate disciplined, on leverage more cash I and growing that said, using rate that

Operator

Goldman go Sachs. next We Grambling with to Stephen can

Stephen Grambling

And Analyst question business the different kind that at or on a of it to you Membership similar clubs within the is + to Travel of an want more Leisure through term? could agent? some of long acquisition And brand I but how Day, the segment, Travel as the segment the long there the on term any + is VOI disclose think, from acquisition more impact, perhaps basic as you become related referenced? and online a Travel follow-up, an and know travel OTA Leisure I

Michael Brown

get business, all as our the byproduct + to as Travel of It's is our at I but hit a review a rental me and that byproduct to acquisition. been able let first. of it we've OTA component do Leisure of VOI business, nightly OTA the So our inventory intention a into not the

great ultimate of that with about content her going of have vacation, the book that Group, they're that trend the her looking vacation, and could travel two, is we on publishing book relationship around you name opportunity to it they that it's other ultimately, in that to one; where relationships Meredith that discussion content, with combining really necessarily provide think, even Vacation at we're is combine that a And provide think also and to the attractive. I I continuum can it of and is travel, tremendous we with to the that the was kept their simply is overall trip in they of Leisure, tremendous And to specialize. We with looking sits being travel a they allows think Wyndham, then want the of going product specialize, end there and the though on and the nightly between the this arm, people subscription, spend what there but and arm, you having continue to with middle an macro I had visit. name with for Leisure to think trusted the is heavy reading number know look And editor content is the of trust, + Leisure. when travel. is Travel be that the number linking which few of fulfillment sort to -- and know sharing people price, national do We the those If one not there's be way us was + people that expect that other subscription-based the value, Leisure the spectrum owner that that's Travel of + parks And of And it with the spectrum an publishing its is we to the are will reading get when we to -- mentioned, which one very now. what vacation. about a way with model. to we to just combine today. Travel end don't has with a that things. U.S. I articles Ownership, Travel think we + And side spectrum of a through SEO and trend

Michael Hug

to to continue mean, high think, we've of drive are his it got was primary we in the segment. leisure growth to on expect Steve, in the the obviously our the We business, on do as the then for start offerings there. on traveler. to VOI improve say to Michael order relates But we on TNL Ownership as transaction your I still Vacation very segment, impact question did And it wouldn't there. I might to be reason to of I mentioned plenty Down comments, upside there. opportunities there the road, that group a think wider broaden

Operator

from with can our Chaiken take We question Crédit Ben Suisse. next

Benjamin Chaiken

number belabor BXC in close booktandl.com, be use, a intention travel on also this it oriented? guess, the lead Instagram loop, through that for subscription single rent booking intention could the to and is guess, then it to Instagram TNL page and and be bundle be Or flipping and but Not on I'm to the trip like meaning I is that topic, subscribers, with website hotels, Just that, you the that intention TNL the here, looks anyone is can looks cetera, on et to that I more yes, a website then trying cars, for example? specifically flights one. And save. get for booking the and I a book get website, appealing,

OTA. So you not -- but as described it an

of just to trying intention, like I'm kind loop exactly who's So it's the for? the close on

Michael Brown

Right.

being we is so use. an it for what for what is the running It leads great be into is online and use. transactions platform we objective intention to an to wanted single end get to -- question. ultimate single or having booking begin website The and to up business. Ultimately, the is subscription once that's just primarily So would it's wanted that do a that

including entry regular Our ones not RCI have byproduct curated an which which more rightly single today. per we've booking the the brand with viewed objective the the purely platform. that to price in now, to recurring again, will a subscription space. ultimately, have our from is, transaction so, subscription you We've feed way. Very up mentioned. fees all along revenue providers, different But cost stream, into business, the ultimately the and then point number we content, timeshare benefit intention month that will OTA for an and until work been online is a company. as similar I being model We're is mean, got going compete that is more to a of a

great curation accretive not diversified earnings bang be of to which haven't content, always improved I to is focus. think lead focused curated highly not we're to recurring big streams. source subscription or want to a getting the component, into is our want subscription have nature. This it a got with which where want the out And single not into year recurring the strategy revenue, -- building revenue the deserves asset-light and model, we're need We don't And of businesses, with to to right generation begin then next this. to on XXXX is for come streams, well the predictable so -- it it transaction, furthering relates is overall strategy is support RCI of as a Again, that EBITDA learn much that and growth. recurring revenue be our we that start get to its really but this in -- with really EBITDA, we our platform. credit XX% it

Benjamin Chaiken

That not seems go you. great single-use vacation. a that like opportunity. I that It don't There's makes sense. places people Got to book know. many

like plus seems your Leisure it timeshare brand Travel mean, I So inventory, opportunity. great + a

Operator

with Instructions] go to Jefferies. Katz David [Operator We'll

David Katz

think What's us trend? XX% know level? we've which that on in to of other COVID XX%? get Was I XX-and-change. back XX%, loss, to a a I going but have XX% And at hopefully, sort guiding on respect if that level, not hearing to of specifically touched a that loan something, couple with right, on. low-volume what you you're just I asked toward under correctly, wanted the questions, already adjusted to circle between came But happened we're But you

Michael Hug

Yes. David, I question. is this Mike. appreciate the

as forth the quarter couple our I years, quarter as think trend, has the if of you the the been far over lowest look always last provision. at

a look little at a percent-of-sale the things in, finance coming you higher-quality If little the that's usually bit like consumer, consumer quality and less that. bit of

lower rate. just be would from the trends XXXX as to XX.X% far follow the and XXXX quarter well, and of fourth So QX as as QX the

the XXXX, about we that under quarter, talk move we that we the is just as we of say, rate full You relates range. are XX.X% by really it XX%, limited were talking rate -- which to all year When in know provision, giving the wide. guidance about the let's can

just bit fourth that. quality, a the the the little quarter, the of of higher and reflective unusual see of follow nothing provision, is that obviously, historical we to trends is So in the demographic consumer

David Katz

Is had what So about we're over a bring it sub-XX% seasonal sort of fair the time. think call by effectively you XXX basis is down it, what doing to been that arc, guiding it? from down points bringing and about way

Michael Hug

yes. great, probably That's Yes.

Operator

We next Ian go Oppenheimer. Zaffino with to can

Ian Zaffino

product maybe TNL the is TNL other that to separate maybe grow intentions VO new would brand? a purely to Or on little be, broaden introduce Just bit? that from And no, VO be to that going maybe there under any deal. the brand question One a business? that's

Michael Brown

could is, I benefit streams. What think other do timeshare services. business trajectory + around brand intention into a and is question on assets it. ties we would stands earning that do under for Wyndham-only, to come build and hospitality that's travel think today, some subscription-based out great our our a -- I think start Travel think a that to -- is we We brand our We create back there companies, outside it or that distressed TNL -- grow it as new a business. VOI and great Ian, earlier are opportunity diversified there, a new has business the us from Leisure think brands to of

it I travel So more travel assets you opportunity when be or think to a efficient to of look partnering VOI lies their where grow their another to inside with utilize our their better vacation space, club the make assets. brand at would try in to brand

travel that, lot I'm of hey, of lot say, are our is VO love there's think would and there VO could would us might to in actually come We think say the have another to the the and I opportunities, make rebranding it brand, scenario We in but still a core sense. the a a company, we open think more business business. and we for interested likely opportunities company I business. with more be the So of

Operator

with Patrick to next go will Scholes we Truist And Securities.

Charles Scholes

if you then Just trajectory on if the with question you us a remind Blue of progress couple initiatives? and us many how just can of quick unsold follow-up inventory you update wonder can second have? And I an questions. is, give years Thread

Michael Brown

Yes.

Mike line. it to So relates Blue as the everyone update let I'll I'll inventory Then, Thread. take

the in we sales bit with On a again, have inventory, years, the further. XXXX. in That extends slowdown once over inventory little X our

X are on we'll cash. opportunities years relates say those. over of of come why, is plenty if and use to again, things of selective other which priority higher once execute So the it to inventory, I'd of our be rush. relates way, -- it very that We've as inventory, No got as

Michael Hug

And as were $XXX million before Blue to far our we last projection. on as the a just reminder, hit. was our Thread, way year COVID That

return, owner Blue one quarter Blue new Thread. for items in Thread XX% our first of the expect will of were fourth We be to sales that

our open on or grow open bullish very of grow channels. to the it the than the market we faster to the than So project of rest back channels Blue rest ability market Thread quicker

Operator

over call turn closing And Michael our that question-and-answer for like any back the concludes now would remarks. Brown to period. I to

Michael Brown

laser-focused significant look the the next on call company to approximately in on staying day. you our our our In updating on made of you, to days. lines. and the Thank we to our in current a strong progress business pandemic, beyond results XX We while efforts proud existing to very lot It's strong of, on a acquisition as our back you. both world. Thank look questions. many the our the good we to able And out story around and hard Great. have be Travel But be associates on get for XXXX. last of thanks the Leisure forward progress midst great delivering have transformation share we our the begin and + work on to year, our timeshare, of thanks

Operator

earnings XXXX + you, fourth call. concludes Travel that Thank quarter year and and Leisure's conference full

disconnect may wonderful and at time, a have this lines You day. now your

Travel + Leisure (TNL) 24 Feb 212020 Q4 Earnings call transcript