Earnings call transcript Q1 2023

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Operator

Good day, and welcome to the Wyndham Hotels & Resorts First Quarter 2023 Earnings Conference Call. At this time all participants have been placed on a listen-only mode and the floor will be opened for your questions following the presentation. [Operator Instructions]

I would now like to turn the call over to Matt Capuzzi, Senior Vice President of Investor Relations.

Matt Capuzzi

Thank you, operator. you us. thank and morning for joining Good With Michele Allen, are Geoff CEO; and Ballotti, our our me today CFO.

Exchange statements. Form subject Before in are Commission we cause the measures those and and at remarks website recent forward-looking expressed our any most on subsequent remind our detail you be filed statements to XX-K get in started, differ with Securities report with These of of annual to investor.wyndhamhotels.com. measures I and reports filed are in today want available provided our actual Corresponding results or will our our materially that implied. SEC. referring Investor risk discussed non-GAAP factors the metrics to a reconciliation to GAAP to also earnings that These on Relations We’ll GAAP may is non-GAAP release, are from a contain number factors measures. risk which

basis on certain providing comparable are We unable to we GAAP non-GAAP measures without provide metric. future impact unreasonable efforts, are a only discussing because

supplemental last containing an filings website provide calls our submitted information the to and public investors webcast. our evening, SEC posted we any our releases, monitor We Accordingly, on conference continue or encourage investor future. we addition supplemental on Relations presentation website our to in in addition, may press Investor In website. information to with the

With that, I will over turn the Geoff. call to

Geoff Ballotti

morning. joining this for thanks Matt, Thanks, everyone us and

we recovery X% by owners our versus Globally, and expected, growing the As prior record delivered with their increased reflected X%, in rooms Adjusted a of and increased X% XX%. our regions sequentially. through XX% is for our new basis expectations. that performance ahead brands This growth a by RevPAR continued and by was in walk moment. net international pipeline will you EBITDA, XX% development our of on in outlook Michele RevPAR grew our levels first quarter domestic our over comparable another which year,

and been desire from explore the headlines friends, their all the million unabated was economy million family memories. $XX household fourth of second with U.S. great of the are we the which brands reflects $XX,XXX, year. RevPAR lowest performance, spending savings unemployment to flow median, $X.X the consumer another start their higher generated driving this accounts, its recovery for growth benefited and above and XXXXs while has it and free a mid-scale quarter of cash share U.S. had and still growth returned over new and throughout By a at With of since create class travel level XX% year nearly continued destinations economic our are with upscale by in trillion, $XX our We shareholders. reflection reconnect our quarter to wallets fully lasting U.S. of with this portfolios to the strong to allocating line primarily of occupancy cadence in in incomes middle This who segment, a gains. guests, rate of recovered Meanwhile, surge was our XXXX. XXXX. for travel by

position and for of rate continued X% the year us achieve a maintained XX of months, to XX.X% We track share net to over our overall last and globally, on proposition. our outlook a ninth brands value sequentially rooms These grew we full solidly quarter. our X%. We growth XX,XXX over retention market improving room system the opened of consecutive indication results

the quarter. above chain for scales sequential system mid-scale West States, hotel we hotel more grew added Quinta United seventh points brand revenue-intensive the including Hawthorn in more additions XXX the construction across the new another Arena. the like with We rooms quarter, over X,XXX sequential Suites Cal growth in XX basis from along five this of dual conversions our new La than Here Sulphur, in with and Louisiana

X% rooms we and net grew organically. rooms X,XXX opened over Internationally, by

some Latin the La booming Quito, Our entertainment with City. conversions competitive city, added upscale new the Wyndham team Torreon Mexican from Garden Quinta, America from along stores steps Ecuador’s our fantastic new brands and in in Capital this like

with Our drove international with Italy’s region sequential Milan net room XX China, And Lake points of an EMEA basis in airport like Como. Dolce Malpensa of first near experienced and reach the quarter conversions which easy growth number quality West franchising campus Gaoqiao new room Days we reacquiring the net Changsha since University. our direct opened to Hotel, XXX Days Days agreement growth in basis Changsha the Inn the points of Inn with XXth system, of adjacent license sequential our master inbound

development and X,XXX our scale a upper upscale, rooms higher sequentially which of by versus XXX,XXX upscale XX% revenue grew pipeline to hotels, and and mid-scale, record mid-scale, X% chain the year segments. We XX% upper are luxury over prior

for Our additions, growth. XX,XXX of globally XXth teams awarded quarter approximately room contracts nearly pipeline sequential XXX marking consecutive Wyndham’s

XX the another contracts awarded Suites March. Wyndham in stay stay to last extended extended of the of bringing developers demand experienced Behind number sector, the total to since XXX momentum hotels contracts brand strength the the and ECHO and institutional operators, awarded by the we launching

count We another beginning two a in XXXX ground ECHO with dozen on break hotels brand XXXX, to contribute to to our and meaningfully expect throughout room beyond.

higher never than our the If now, continued construction Conference industry. Hunter vibrant than last segment. that our and This prototype enthusiasm unbridled that or at new year, the interest signed it’s a and number teams of reflection Owners quarter own there in a thing conversion in especially experienced another is of we few a developer was owners American Association to franchise the month reflecting is Convention there believe better hotel domestic and Asian what build Hotel sales our in that awarded time Investment development one last the has a the ECHO, select-service at strong been ago, XX% and Excluding first contracts weeks hotel brands.

the our years and XX% we ahead trillion $X.X annual CHIPS and up government’s domestic for a royalties, from expected accounts, approximately Wyndham infrastructure-related months of which as business the is remain U.S. capitalize Act to Demand Infrastructure our spending. coming in on in makes tailwind

increased quarters, second eight general infrastructure-related versus Wyndham’s of consecutive that past a For trend double in XXXX, quarter revenues have the XXXX. the began digits

spending $X.X Our domestic very levels federal estimated hotels states spend. to well future the one an states allocated with the the level technology processes We’ve as these to continue more support this spend from Wyndham share the of revenue the we received over and our these $XXX third opportunity incremental infrastructure invest to new infrastructure of expected overlaps growing in and highest six of sales by our top date. people, size teams And to accounts. generate footprint over for of over over that of of period for billion the receive the have of spend represents to incremental royalties global franchisees ours infrastructure system million capture to

hotel fifth and Rewards Minor tickets be our offer, ballparks nearly for of experiences access scheduled where points where during recognized Our for one their hotels one-of-a-kind as the recently and XXX readers and XX games. best we to year a Loyalty like partnerships all the we of offers League loyalty the XX-mile including program to through experiences unprecedented Minor because announced League program was X,XXX able redeem of the by that it’s consecutive Today will simplicity, to it generosity the within USA award-winning Wyndham its Baseball, with members radius has season’s Baseball averaged

our across grew X%, celebrated for a most we level we drive hundred contribution the importantly, increase high of XX% recently which again During the by enrolled Wyndham all of representing in millionth helped growth quarter, enrollments direct once member. record brand.com outpace channels. one and rate our Rewards And a third-party bookings sites,

core place it in Best Forbes drives and see no the a to diversity growth & to was world’s the are work. row; selected Ethisphere such And of Newsweek Employer Large at Our as was service ethical surprise of in one and and heart to places by great our our as XXXX year America’s most XXXX of makes companies. as Wyndham greatest for by very what by a work for one values a Wyndham America’s XXXX; second culture that count-on-me Hotels the Resorts what

As sincerely members whom the our this possible. would without around be valued always, thank of none we team world

over I’ll And with that, Michele? Michele. turn to the call

Michele Allen

will flows a review then I our good my detailed our of first results. morning, and I and will balance with outlook. begin cash followed our sheet, Geoff, Thanks, remarks review today quarter revised everyone. by

me address housekeeping started, briefly items. some let Before we get

One on focus of simplify key priorities our our high-margin our greater to been create has business a business. franchising and

XXXX, contracts With the management U.S. of exit we quickly of owned the service management composition contracts. full hotel management the transitioning attention that segment with immaterial in internationally been a we’re the results. effort approximately eliminate full The our aggregated to in results only service segment. segments substantially assets our remaining our with have the turned franchising now complete, And two reportable U.S. to the quarter’s to sale service the of franchise-only basis Management business our this prospective and changing Hotel of are and within our select and on beginning in XX

on of the the The financial hotels heavily quarters potential and spend. of for and quarter select-service the four pace. year our both fund year, of last comparison results comparability this impact influenced regarding year-over-year the concerns a year’s impacted of variant is fund In business. the of our more to this has spend also contrast, returned our all sale demand. Additionally, the next the normalized was by by management marketing pattern This our Omicron exit timing owned marketing is spending impacted of by

highlighting transparency which $XX $XXX million provide compared our from basis, ongoing management fee-related be and will revenues $XXX of a other of and to our To select-service year, these and operations, hotels. impacts. included the of business results I which last results on We understanding enhance generated comparable owned million the million neutralizes a better

fee-related of fees. franchise license On revenues incremental basis, and RevPAR increased reflecting a XX%, fees primarily X%, comparable growth and other higher

management in quarter included $XX million EBITDA million from contribution business last year, an $XX $XXX the timing funds. from $XXX Adjusted and a select-service compared owned the which was million marketing million the hotels to impact and first

quarter returning cadence year-over-year, revenues revenues reflecting XX% million, quarter the EBITDA revenue the while by year, more first marketing year. to a On increased spend $X normalized growth. primarily XXXX million marketing basis, exceeded expenses our adjusted expenses in this exceeded by in With marketing first comparable a $X of last

EBITDA X% driven repurchase to RevPAR XX% growth reflecting our XX% stronger the RevPAR benefits currency adjusted First basis, grew year-over-year basis, occupancy. quarter first a partially and In from compared X% global adjusted pricing on interest and higher higher grew constant share expense. comparable up activity, U.S. both offset quarter, EPS on XXXX. our by by diluted a $X.XX, was and

prior Florida, April has in states to growth the four recently, of now the We weeks many Georgia strength leisure of four RevPAR hold XXXX and North travel of fourth XX% larger the running tracking accelerated picks in ahead quarter saw weeks as represented ADRs ahead and up like our levels XXXX. a Carolina. point with of More Texas, past and

last reflecting XXXX currency growth XX% demand regions driven compared This XX% fourth to year. Sequentially, constant XX% XXXX improvement levels which to China, quarter to the XX% quarter strong compared quarter the RevPAR from was improved first in acceleration Internationally, in last and international the grew XX% in XXXX. in levels XX% occupancy of by fourth to improved year, XXXX. of from all of of

on for our occupancy international a this we last year. expect throughout meaningful mentioned us to As call, provide tailwind

$XX first We Now flow. million free cash generated quarter. to in the turning

as level the free last reduced well hotels year projected, marketing as year-over-year included and flow our cash was owned a as select-service spend. down of management business As

Importantly, conversion was EBITDA our adjusted cash XX%. flow approximately free from

to track are of net converting full flow, XXX%. of at solidly approximately to XX% cash income free the achieve our to which XX% year adjusted to on translates goal EBITDA adjusted line We

approximately million X.Xx. low total at ratio quarter the net very end $XXX with of stated ended our range and We the our leverage liquidity, of remained at

Our allocation strategy remains capital unchanged.

strategy tenets M&A earnings from core net brand remain complementary that are an pursue transactions portfolio and will our the on and room accretive and to We disciplined existing of perspective. our growth

also improve new brand invest our prototype designs continue in brand to overall to equity. will to incentivize franchisees We

opportunities community brands including SBA recent financing banking financing government-backed source a existing lenders have well established developing for types, as owners lender. and multiple the relationships. who with lender strong which have our of our regional Regarding record development credit Many the as from and unions, and banks, is non-bank limits lenders exposure new owner track our are headlines, vendor

with remained will and also projects deals Conversion dozen the XX. XX XX have post last discussed construction subsequent reassured by that in XX the our ahead that been whom situation we work portfolio continue year progress remain quarter for of a site with volumes have first lenders point, well-established Owners new buy-sell March to strong across borrowers March deals SCB executed their new to financing To beginning this with available. and headline. creditworthy, almost new transactions

we’re closely growth ensure next may us or address deal our remains our we model. concerns trading And the mentioned, do their to and potential the development in owners’ strategy franchise construction desire resilience always, hotel As volumes quite that pipeline as strong be proactively and confidence of new and our monitoring to conversion it arise. Geoff provides can any

Now turning outlook. to

full rounds our activity. billion. and updating outlook first as to $X.XX Fee-related revenue $X We’re increases a well to repurchase still year reflect share our February’s other outlook count favorability and as million to $X.XX lower by quarter XXXX billion from first due to quarter

$XXX to as $X increased is and million million EBITDA now Adjusted to $XXX projected well million. be

million our And now projected share to as a share excludes $XXX future $X.XX which, income net to $X.XX count on potential based $X increased higher be adjusted of diluted is expect adjusted million $X.XX EPS than share million, per to outlook. usual, $XXX million, repurchases. prior $XX.X and We diluted of any

There year unchanged, expectations the our some our for or free outlook for on cash the while impacts. to marketing remains to RevPAR full room growth, were rate. quarterly global provide conversion for changes global Also, funds growth our color prior projected net flow contribution I want no

normalized fund cadence to marketing revenues million. again year, by million more a fund quarter $XX the outpace second expect expenses $XX we spend during As this of will

year, our back full expenses outpace that which the As we year of we will complete of half move estimated will fund underspend at the in revenues $XX arrive million, into to recovery our back $XX million of the investment fund XXXX. made

zero trend the of approach the transition, we towards year. to given managed Finally, end revenues cost expected reimbursable are as the

while confident any closing, that developers continued successful our the us environment. attractiveness by In first our strong in a and capital guest owners resilient allocation. system model business brands to RevPAR our pipeline position another disciplined highlighted balance sheet size in quarter remain approach maintaining to results deliver of growth and underscore and to year We

and With that, take I Operator? Geoff your would happy be to questions.

Operator

[Operator is Thank questions. now floor The for you. Instructions] open

question Joe J.P. Our comes with Morgan. first from Greff

Joe Greff

bit conversions of has then China what percentage does on bit and talk terms probably new give for well? call can comments internationally detail about it can developer as down financing, I in need particularly of morning, financing that us Michele, orientation a you everybody, Michele. Geoff, for or the and associated? thanks and typically think front on Good not here. go all you overall, a when this most us scale the even and as maybe is know financing that in about chain typically construction center you what topic your little more Maybe little percentage of you stuff have of of and/or

Michele Allen

pipeline say place. Joe. what’s is in our I that in has morning, conversion in our pipeline construction Good you a – the house. our From about already standpoint, financing I would financing additions, majority the all think already if XXXX new of in

really feel situation. we about XXXX the strong So financing

new his Developer at strong. mentioned a progress first interest and March site construction that headline. our future in could projects that remarks kind dozen construction the work beginning quarter and Geoff remains of additions. prepared look with deals XX starts, to new we continue impact If in almost after that year

deep really and developers long season much financing really those available. relationships and for very So are is

small terms some – March with In XX for we’ve fact, that the best a while. property new term the $X sheet million loan La that Quinta in came a a south an date build of lending in million seen we $XX came regional saw through bank with on a after

construction currently There financing largely there. financing available amount capital for have new be So place. seems we’re in not about that don’t that certainly a projects good to concerned of still

That’s would the the that also then XX year. – And we’re then versus time year-over-year. actually we date. last new I portfolio conversion the got side, on executed have March buy is seeing XX that point And deal since across increased up volumes – our only other we’ve make deals sell XX that same have

current is and of that believe So we environment healthy to supportive conversion activity. continue the

Joe Greff

the Great. sequentially of thinking level then of with of last was about, lot this the on flow, XQ the returning a Helpful. buyback morning quarters. absence, form down buyback last asset incoming this Is and activity? versus the down after capital I cash three the And the of that I questions producing maximum it’s dividend how buyback kind that excess average the is night, in guess getting and after any cash flow cash free guess cash is excess you’re

that about that? right you’re leverage. would are above why peers that’s just imply thinking times is half X now, your sub And And net when if leverage of the buyback a particularly at how sort that turn at a something of least ratio,

Michele Allen

Sure.

I one-time up So on as look be which XXXX was our in CPLG but to the think than if proceeds volume the received at those of you February our was XXXX quarter-over-quarter, certainly about absence [indiscernible] $XXX buyback year-over-year, about buyback from XXXX million. XX%, due call, ex, assets will lower we the owned mentioned

So preference a generation opportunities we perspective, always this in say we’ll require debt and after cash then payments, to the year. compelling to deploy absent our investment but we from first any $XXX flow dividend just have our pay over business, free is invest million

program. to go trading discount today, to so course, estimates compared stock unwarranted And potential a intrinsic a of amount set minimum the relever you is into significant of and our value. that’s the and I own think is can to buyback our say relative share There see I’d at peer

present that does So a opportunity. compelling

the we would that to say I’d do up flow, future stock this. this, fair so it’s when that. increase. interest necessarily the would environment, stock when volume, lean value repurchase And but significant that amount is be free us say don’t more But think cash share than expect to It’s capacity, predominantly, exercise, gap like in we generate flow temporary a be we today’s nature a I interest can to versus a trading leverage borrow cash to math heavily rather need especially in could lever forward do we the rate trading more paying. of permanent You in pulling is to that like use leverage increase likely potentially that the

X to target We is are – our stated X times. range

very at We low We that room the as times. means be is X.X are of to some than that there X.X And lower also not times. expect at do end that well. obviously there

So I it comes flexibility this buybacks when think we share have ultimate to year.

Joe Greff

Great. Thank you very much.

Michele Allen

you. Thank

Operator

Thank you.

Our next question Stanley. Stephen Morgan Grambling with comes from

Stephen Grambling

from And you with Hi, get think, are thanks. your on some in at mid-scale any you even economy overlap either you characterize are I requests competitors would surface the extended There’s over stay competitive money the make deals brands, the to willingness that to your opportunities? moving line? or potential lots seeing may of areas when or environment into in key put development in change at looking have these various either least segments. some talk, the How additional of

Geoff Ballotti

mid-scale No changes, the on and last a terms we’re seeing bit economy been weeks our Stephen, quite our road we’ve over to really and not any impact in out or of brands. few the

millions requirements PIP our costs, which of in requirements the competitive terms Given PIP the measured dollars. far don’t proposed table being – average that our far on exceed to necessarily value in of our get conversion owners, what’s exceed put PIP

PIP X peers. many larger in to of generally run costs X less brand times renovation Our our than

recognized to a at their cash them outlay. the what’s RevPAR And economy performing we their have and And them right segment, also at know is owners is across when are now we we on in economy and you with And that the relationship cash know to important cash space the the these historic index. their brand brands and very most important flexible most important what’s what’s return. look

cash along example, brands, and deliver that right in cash on plenty competitive Microtel, mid-scale you new class of that have now now. building and economy upper with best We right their returns they’d with us owners construction, and mid-scale for competitive tell are Microtel

of on and their better no return now cash thousands owners right their tell who’ll certainly, And we you that have there’s cash days Super Xs than in.

So what offered. did terms not in the more the priced not in any operating. less our I costs, impact, they’re will QX seeing the but competitively stack than most importantly, brands provide significantly And economy executed on on flexible being and And running continue rooms only most PIPs, we think most than to also I of we technology which in our we space, year. think last are

impact. So seeing again, any not

Stephen Grambling

That’s does helpful. like portfolio things you the about that the you recession this that follow-up referenced that assess but try there I Are recognize Do kind out different? down? that trade they at Maybe downturns. one you and what looking accelerating trends into you through various of there all assets the guess, think when so-called April, for back typically unrelated things would and to Are see your concern I business? super for there’s to environment? look look macro, I playbook always Thank you. broader do you’re how perform even of

Geoff Ballotti

We’re assess out the trying to always and looking environment.

would which did to last to rooms the Matt guiding all We any net a of in XX continue of would out job in broader last put range mid-scale slowdown, brands night value continue we think and in on would as did to outperform lodging Slide continue there in in presentation we’re seeing. downturns. brands putting within provide out our would our certainly the the our event our good three we really guests the not grow and macro how economy, proposition segments to perform investor our market best – the the I

XX% post widen, basis midscale throughout suggestion performed XXX now and value the than our segment GFC. standpoint, COVID, your $XX. it’s now to look RevPAR terms how from between in better gap outperformed, to industry right at continues than And it the a more down overall That is X/XX of brands that upper $XX points the over proposition is trade economy think the by compelling. you Our if the after by I was brands

you that if gap was a quarters at And ago, think and the upper upper I the is which gap between upscale, couple a look $XXX. the midscale $XX pushing

So we signs we seeing But what slowdown. any our said not seeing any we’re of there, trade opportunity in very in of things remain again, prepared out we’re down should a compelling slow. terms as remarks,

Stephen Grambling

much. great. so That’s Thanks

Operator

Thank you.

Our next comes from Baird. question with Michael Bellisario

Michael Bellisario

Thanks. Good morning, everyone.

to you wanted expected you And have into signed then bit to and back brands a or Just conversations side, go get saw little of where more that topic XX where any – deals the you the strength. development or flip any those to new stalled locations signed? mentioned, deals dig particular maybe get also on didn’t if

Geoff Ballotti

pre Yes. post and any From we’re standpoint, said an remarks. in an not of either, opening seeing her Michele execution slowdown signs as standpoint or

Our always first XXXX, that that year. to was look conversion we of increased and which a quarter signings over high water the back think

construction Microtels, pick Wingates, seeing I that signed we new as we signings across mentioned, Our picked really and see more, Hawthorns, economy continue up, great more our the and up more And we’re brands, certainly, to country. interest.

Michael Bellisario

Got trends, quarter one what X% first just into and the it. as throughout you U.S. And in on on you in the quarter, Can the the international plus RevPAR you color I mentioned, well? saw follow-up provide plus any in think, April. performance then XX% April then first

Geoff Ballotti

Sure.

line versus of which our and XXXX improved in present RevPAR XX% in for sequentially, year, for first up up the up regions was expectations. with with noted, which international XX% see. XXXX. quarter to Mike, a tailwind us we’ll across continue the significant to constant it Overall, Michele and was currency, strong prior really XX%, to Canada good growth, was all was As

strong. RevPAR now strong it come of with back XXXX has back XX%. over Europe, running points Asia, up was Southeast to now which us ahead very in has levels, Germany where been And back with is XX XXXX. was

up China, travel think for was then, quarter the their we’re to we happy high ramps week, April. into in come was I having what very strong year-over-year there with which to continuing I very last and season. lead course, us inbound And the internationally to up. see as was China down they’re XX% a in, America, and Mexico the outbound the back up expected way standout team with in both XX% Latin of And

Michael Bellisario

Thank you.

Geoff Ballotti

Thanks, Mike.

Operator

question next Bank from Dany comes with Our of America. Asad

Dany Asad

Geoff, sort tightened touch more good development of environment Michele. financial was one expected I their the competitor experience around slow, global that said back they development crisis. and Hi conditions just a wanted sorry, to on to time, as but morning, yesterday, that the

is then as your credit seeing still here, availability? and cracks not out but how it, lower project higher expectation for projects get those what from I what plays So pencil here? this rates, prevailing to to from you with are of offsets costs higher any do maybe you’re know then And some the developers?

Michele Allen

free. you start. And to feel Dany, add Hi I’ll please anything, want Geoff, if

even at X% debt, So, presentation, see I then the ROI that ROI unique in investor a from strong in with the just we would cost have of the the high returns. offset costs are posted classes, you whether teens, to that say an owner of all – impacting some website And the in ROIs and it these equation, really perspective, still you not are that can are as – continuously we actually interest so room rates to or ability hotels. inflation the asset know, interest out But higher of rates that hotels pricing. change presented they be

desirable during developers increases base and a their environment lodging highly investors into cases. estate sure underwriting these an class real And be so are sophisticated to for inflationary perceive

delivering done interest although historic Fed for hotels, will are is higher owners are very expecting this a environment. is service great specifically, and once to the is decrease this select requirements still and well-capitalized with we in than the they build, the staffing developers time lows. Everyone So rates minimal high believe even ROIs a bit

And why much they’re so very in demand. that’s still

Geoff Ballotti

number say we record seeing signs. And we’re mentioned, opens saw that, I a as Yes. would of last year we – and

and There’s new in are slowdown, American Manzanillo the the new than Latin and the Mexico Quintas to quarter, prototypes in just now construction I new last X the seeing mean down of the countries Republic it. example, spread our the I XX X, across example for demand America, that Super first Dany, Super mentioned that better not and was really eight any under La along it’s conference week, with We’re more I for world. development grow. XX come. Mexico in to at pipeline in Latin across no continues has Dominican with our

So first what to we needed done. confident the we’ve that in we’re do quarter,

We’re we And to. on expected down. any opened of not track, seeing we again, signs slowing anything and what we’re

Dany Asad

you have underwriting – and and on you RevPAR what And then Thank you domestic bit data travel into for you super for a four-week so with you, give the average, into – what on the especially Great. color as of your or out insight did of that head a is acceleration period on travel? helpful. your that. the much us little of how give that’s is Can the of maybe lot summer front kind April up, coming for plays kind in we your expectation expectation of

Geoff Ballotti

I with You as Michele and go, can I’ll excited seeing. what noted jump in. Michele we’re both we’re want start to Michele? off mean

now and X% further opportunity the X% to being year April for X% mentioned Our last a and for XXXX, But weeks, you accelerated seeing up four our April last XX% is Mike XXXX RevPAR point I as to we’re accelerate. which XXnd, of RevPAR, last mid-scale, weeks four XXXX. and domestic has It’s at is was certainly it drive up as Dany ahead the through or last to economy noted versus last to RevPAR of weeks. versus up our X% mentioned, RevPAR she first versus four weeks to our prior XX% And think also up up year XXXX quarter. up, the four

remember really on on what the that now. that XX, different. our to when out our business is again, mean, And segmentation, segment of right picking that it of I worker got look is Matt we’ve at you then So I blue-collar why think is so put is demonstrates it’s infrastructure and XX% IP bullish. XX% Slide leisure our we’re up

than of our travel, white-collar X% being of less and than have business X% business being business We less grouped. our

they with segment, And have. and ever real occupancy they’ve savings still XXXX. we’re with with above guests So optimistic ADR that both the very and employed below mid-scale our more our in balances than been

ever they’ll us in our of your more XX% they’re our that six the this question telling to are high. at summer, guests guests have planning an allocating surveys, that trip next and us told travel a to is all-time be Our months than XX% in

will presentation we and household gravity over think might do believe our point, guests I not that significantly the their our they’re out are not investor at important growing there. increasingly, defy income travel only highlights that of that younger. XX low So earners, on $XX,XXX And leisure any Slide other economic incomes be

seeing all so metrics out of with confidence. plays that us in terms we’re the And give of what that

Our booking levels. running traffic mentioned web as ahead windows XXXX being XX% now of our we to up year, last XX%

XXXX. excited ahead, significantly You volumes search just average have date Google got from to running April to to a look of ahead about year. get at then our perspective, the ahead of running of last month summer stayed leisure XX% And length we’ve

know that further ever, We forward looking and we’re to than more summer. staying our are the guests So they’re often. driving

Dany Asad

you the color. for Thank all

Michele Allen

And that’s then perfect, – Geoff.

only I the respect add year. the I that think rest to is would the with of to thing

providing the Geoff the any are in the We he gravity, he is we’re in were outlook And it insulated perform I first that words mentioned, quarter. U.S. how pretty pretty expecting to outcomes. to economic And of then, our the think similar second well used. a or range thinks from performed

continued by within experiences benefits from the see and would spend for So again, think market. travel, the into impacts international range, that coming infrastructure consumer I incremental any preference strong that we potential recovery muted including

have very transient then just exposure we business travel. to corporate little remember, And

impact really segment remind while point this economy the want reductions do segment we’re And this topic, double on the won’t I of to the is quarter. of time. [ph] digits you we feel potential at only ahead we T&E in is in any XXXX say So that can running

Dany Asad

helpful. you. much. so you Thank Very Thank

Geoff Ballotti

Thanks.

Operator

Thank you.

Pizzella with next Bank. question Our Deutsche from Steve

Steve Pizzella

Hey, taking good everyone. for morning, questions. Thanks my

have go for those not to have yet, percentage financing completed? believe Just the you what pipeline you can that ground the and the committed those new back rooms you of wanted to pipeline. to be expect broken construction about talk construction And in

Michele Allen

place. system that, say half current Sure. a in financing a entering beyond financing has probably And Everything third into XXXX I place. has in to in then would the

Steve Pizzella

change us where And And other Okay. then of are control up downturn? you a on does independent can owners, or change that following typically your brands? Thank you. conversions, of remind any the just conversions profile from during sourced

Geoff Ballotti

could independent, skews X.X bit it over being branded, and Steve, in X/X, out from America, skew. million supply. downturn, more [ph] we’re a what During rooms competitors, from terms not bit. which to which a It are that in of independents States does up you seeing, not look economy X/X it’s X/X, built a that X/X at But change X/X, additions certainly, half if be there downturn, might and X/X there’s the from picking usually then a of of United

Steve Pizzella

it. Appreciate you. Thank Okay.

Operator

Thank you.

David Katz Jefferies. Our with next from comes question

David Katz

Good to Hi. deeper. to a of already a and for of Thanks you a know just taking the questions. go my a drill in back me, I questions Asia everyone. bit bit wanted Covered morning, I ahead bit indicated quite it’s but tailwind.

some seeing on I you’re stage just describe of And revenue is of recovers? as in growth. you sort intensity think the Can terms remind relative historically the what the at? ground, it’s been us that outsized we’re what whole to what

Geoff Ballotti

David. Thanks,

was stage to of as where we’re nor noted terms In the back yet we’re did Michele be. expect not XXXX to we at,

trends out levels we and acceleration. first over fourth it’s the XXXX we’re expected. continued seeing that’s year-over-year reported we I the improved see came gradual in But as in the it to think encouraging first in quarter the being the in And I in few been was certainly uptick great to the last think XX-ish about quarter, from percent significant weeks improvement to It’s positive of – that see XX% quarter there. exactly the occupancy.

travel our it’s the so what it’s isn’t that’s where hearing up. inbound which to teams of back domestic terms visa picking In travel both was capacity, resumed back. yet in we’re it from and ground, flight XXXX, applications, has on encouragingly China bounced

of cities, a offices both that have given in in I Shanghai, that between we a takes COVID, XX back XX by and to we’re flights think flights to week times up picked that, has Singapore hearing a week, the increase could June. week that and team our flight most which was three running

that’s encouraging. So

there hearing the on April XXX% and travel XXXX search we’re busy reporting from volume Our vacation over versus planners of as in period. government Mainland China And planners, they’re partners for aggressive partners meeting cost team mice – very stimulate our events. some we credits for to Foshan, into cities providing Ctrip, up our come marketing tour like to actions

what than our the finally, the master been We the has pleased our last license overall side, very for more entire opened did development including And direct agreements. team just saw X% a X% team net rooms in we’re growth And first on China and they doing. year. with quarter growth then sequential a room our system,

I quarter of business. China double-digit was net room think the third consecutive this domestic direct for franchising growth our

basis. really pleased. see I Michele team – China importantly, and our in up China were I was overall to sequentially on that we’re moving So And the pipeline to pipeline think pleased about and most an what conversion what growing year-over-year

David Katz

Appreciate Thank Okay. it. you.

Geoff Ballotti

David. Thanks

Operator

with question Barclays. comes Our Montour from Brandt next Instructions] [Operator

Brandt Montour

you of way deals Joe’s very maybe the in is? I what can conversions. good ask wanted need different then activity But low us cash back conversion I percentage average know morning like brands the taking for a in financing? days convert what overall, for that And for would could cash circle Hey outlay. question. tell you to outlay some for a of everybody. on question just your Thanks my to slightly

Geoff Ballotti

the larger property something are improvement competitors offering. of looking would Yes, seeing low financing to that it’s percentage the hotel on in we’re when times as in involved. their of rarely our very we of we’re or And what brand a days that terms look Brandt conversions competitive plan, in three at financing bringing at cost five need in a less independent an marketplace deals, that

And we increased terms of of conversion a rooms and how believe both that’s signings. piece openings in big been our

and domestically increased domestic than more in in opened what the quarter back we did conversion and Our rooms versus mid-scale year. rooms we we X% economy pre-COVID. conversion globally And last opened more X% did we

So there. of we’re seeing with the any signs slowdown we’re progress, pleased and not

Michele Allen

Yes.

million typical than – less be in the $X owner to typical For decent yes. going it’s economy economy on a Brandt, for outlay property side. condition,

Brandt Montour

April bit in in if take we And dip Perfect. guys to a saw talking showed defer you like a trends bounced I – I know, it you but shelf looked don’t of specifically on then my about economy to stab March, the maybe at back, occupancy. little not. think hear want it’s great that were SCR Geoff, a what

you or it or weather have think I if think March? it return want was happened if timing, to a shot you take what might at was tax in

Geoff Ballotti

Yes.

our came expected, expected, but Brandt. came in quarter said, as we as just As we well in March as

think XX% from it you was scales about business, you back its XXXX. chain peers, we March XXXX. growth Unlike not March fully our if If XXXX, the recovered of of that over last in was our domestic many of year felt. look impact the And Omicron feel did higher at

the last XXXX, it So the and to up where XXnd, it four I is XX% in point, overall in year your accelerating, to but as And RevPAR was is our was where did expected. through RevPAR ahead X% for which up the again, came weeks to quarter. economy the for mention of last it April of

Brandt Montour

a Thanks lot. Great.

Geoff Ballotti

Brandt. Thanks,

Operator

you. Thank

will question with from come Morningstar. final Wasiolek Our Dan

Dan Wasiolek

for guys. morning squeezing my questions. Thanks good Hey, in

of NUG the ECHO What room Thanks. unit years. brand new in So new and percent thinking are brand? how conversion the that long And is potential maybe for the interested ECHO does open? construction contribution contracted build? pipeline you a brand one to coming just over for the [ph] long-term of it current that to the How versus might hotel of about potential on kind have guys take

Geoff Ballotti

questions. great All Yes.

XX. XX construction with be. and they’re as real they estate companies developer off and months, depending backgrounds behind between and These averaging management them excited third-party sophisticated very anywhere, the could looking on as are I them, XX developers behind and We’re strong and running think,

question, We’re They have XXX expecting be first question in construction. ground to five We we’d the dozen years. open two – will another new year. breaks your all good said this

will feel about We on based good doing XX not be brand. in numbers with very this are. where we first expecting the And and both we’re those of XXX conversions we years,

building, the more lot in do demand or that’s given Texas of so out are can’t like Arizona building the infrastructure a we there that driving states reason no or of there’s receiving And Georgia especially that’s this. much

every hotels fees for open to about and it. XX% of $XX are of that that expecting to million We of increase XXX $XX an million we royalty expecting drop

Dan Wasiolek

much. Thank Okay, great information. so you that’s

Geoff Ballotti

Thanks, Dan.

Operator

for Thank the turn you. this Ballotti At time, any to floor Geoff remarks. back over or closing I’ll additional

Geoff Ballotti

that EBITDA Well, were growth raise We and our quarter where very our your everyone, thanks, for full outlook. we expectations Hotels Wyndham questions delivered Resorts. year pleased interest your adjusted and us outperformed Todd, allowed & with to thanks, in and first

our seeing opportunities of Matt look and confident forward to members to be and you day, guests team our upcoming our Our Michele, shareholders, deliver I the value ahead that and lie weeks very in outstanding and great many our attending. talking about that a of to to ability Have the franchisees. the enthusiastic everyone. at many months and ahead conferences we’ll investor in are and

Operator

this disconnect and Please Resorts & wonderful XXXX at Thank First you. today’s Hotels Quarter have does This line conclude a Conference Wyndham Earnings Call. time, your day.

Wyndham Hotels & Resorts (WH) 27 Apr 232023 Q1 Earnings call transcript