Press Release

Printer Friendly Version View printer-friendly version
<< Back
Wyndham Worldwide Reports Fourth Quarter and Full Year 2016 Results
Increases Dividend 16%

PARSIPPANY, N.J., Feb. 15, 2017 /PRNewswire/ -- Wyndham Worldwide Corporation (NYSE: WYN) today announced results for the three months and year ended December 31, 2016.

FOURTH QUARTER 2016 OPERATING RESULTS
Fourth quarter revenues were $1.3 billion, up 1% compared with the prior year period. Full reconciliations of GAAP results to non-GAAP measures for all reported periods appear in the tables to this press release.

Net income for the fourth quarter of 2016 was $164 million compared with $140 million for the fourth quarter of 2015. Diluted earnings per share (EPS) increased 26% to $1.53 per diluted share compared with $1.21 for the prior year period. Adjusted net income for the fourth quarter of 2016, which excludes charges and gains in both 2016 and 2015 as detailed in Table 7 of this press release, was $146 million compared with $113 million for the fourth quarter of 2015. Adjusted diluted EPS increased 38% to $1.35 from $0.98 per diluted share in the prior year period. Adjusted net income and EPS benefited from earnings growth across all of our businesses. EPS also benefited from the Company's share repurchase program.      

Fourth quarter EBITDA was $322 million, compared with $275 million in the prior year period, an increase of 17%. Adjusted EBITDA, which excludes charges and gains in 2016 and charges in 2015 as detailed in Table 8 of this press release, was $318 million, compared with $273 million in the prior year period, an increase of 16%.

"In 2016, we delivered earnings growth and free cash flow that were both in line with our targets despite headwinds from a higher provision for loan losses and foreign exchange rates," said Stephen P. Holmes, chairman and CEO. "We achieved these results through consistent execution, careful expense management, and continued disciplined capital allocation."

FULL YEAR 2016 OPERATING RESULTS
Revenues for full year 2016 were $5.6 billion, an increase of 1% over the prior year.

Net income for full year 2016 was $611 million compared with $612 million for full year 2015. Diluted EPS increased 8% to $5.53 from $5.14 per diluted share in the prior year. Adjusted net income for full year 2016, which excludes charges and gains in both 2016 and 2015 as detailed in Table 7 of this press release, was $636 million compared with $608 million for full year 2015. Adjusted diluted EPS increased 13% to $5.75 from $5.11 in the prior year period. Adjusted net income and EPS benefited from earnings growth across all of our businesses. EPS also benefited from the Company's share repurchase program.     

Full year 2016 EBITDA was $1,331 million, compared with $1,266 million in the prior year, an increase of 5%. Adjusted EBITDA, which excludes charges and gains in 2016 and charges in 2015 as detailed in Table 8 of this press release, was $1,373 million. This compares with $1,297 million in the prior year, an increase of 6%. On a currency-neutral basis and excluding acquisitions, adjusted EBITDA increased 7%.

For the twelve months ended December 31, 2016, net cash provided by operating activities was $973 million, compared with $991 million in the prior year period. The decrease reflects unfavorable currency movements of $48 million, including a $24 million devaluation of the Venezuelan bolivar in the first quarter of 2016.

Free cash flow was $782 million for the twelve months ended December 31, 2016, compared with $769 million for the same period in 2015, reflecting lower capital expenditures that were partially offset by the unfavorable currency movements referenced above. The Company defines free cash flow as net cash provided by operating activities less capital expenditures. 

FOURTH QUARTER 2016 BUSINESS UNIT RESULTS

Hotel Group
Revenues were $316 million in the fourth quarter of 2016, compared with $314 million in the fourth quarter of 2015. Revenues reflected higher franchise fees and growth in the Company's Wyndham Rewards credit card program, partially offset by lower reimbursable property management revenues.

EBITDA was $99 million in the fourth quarter compared with $94 million in the prior year quarter. Adjusted EBITDA grew 6% to $99 million. In constant currency and excluding acquisitions, adjusted EBITDA increased 8%. This reflects the higher franchise fees and growth in the Company's Wyndham Rewards credit card program.

Fourth quarter domestic same store RevPAR increased 2.9%. Excluding oil markets, domestic same store RevPAR increased 3.7%. In constant currency, total systemwide same store RevPAR increased 2.7% compared with the fourth quarter of 2015, which reflects softness in domestic and Canadian oil markets.

As of December 31, 2016, the Company's hotel system consisted of over 8,000 properties and over 697,600 rooms, a 2.9% net room increase compared with year-end 2015. The development pipeline increased to more than 1,110 hotels and approximately 138,300 rooms, of which 60% were international and 67% were new construction.

Destination Network
Revenues were $317 million in the fourth quarter of 2016, compared with $310 million in the fourth quarter of 2015, an increase of 2%. In constant currency and excluding acquisitions, revenues increased 3%.

Vacation rental revenues were $151 million compared with $144 million in the prior year quarter. In constant currency and excluding the impact of acquisitions, vacation rental revenues were up 5%, reflecting a 5.3% increase in transaction volume, which benefited from enhanced yield management as well as capacity increases across our Denmark-based Novasol brand and our U.K. cottage and parks brands. Average net price per rental was flat.

Exchange revenues were $145 million compared with $146 million in the prior year quarter. In constant currency, exchange revenues grew 1% as exchange revenue per member increased 0.4% and the average number of members increased 0.2%.

EBITDA was $53 million in the fourth quarter, compared with $44 million in the prior year quarter. Adjusted EBITDA increased $9 million to $52 million for the fourth quarter of 2016, which reflects the revenue gains from continued strong vacation rental performance and lower costs.

Vacation Ownership
Revenues were $705 million in the fourth quarter of 2016, compared with $706 million in the fourth quarter of 2015. 

Gross VOI sales in the fourth quarter of 2016 were flat, impacted by sales office closures from a restructuring and Hurricane Matthew. The number of new owners added during the quarter was up 8% from the prior year quarter. Volume per guest was up 0.4% and tour flow declined 1.5%, reflecting the closure of sales sites as noted above.

EBITDA was $182 million in the fourth quarter compared with $174 million in the prior year quarter. Adjusted EBITDA was $191 million for the fourth quarter of 2016, an increase of 10% compared with the prior year quarter, due to lower costs.

OTHER ITEMS

  • The Company's Board of Directors authorized an increase in the quarterly cash dividend to $0.58 from $0.50 per share, beginning with the dividend that is expected to be declared in the first quarter of 2017.
  • The Company repurchased 2.1 million shares of common stock for $150 million during the fourth quarter of 2016 at an average price of $70.34. From January 1 through February 14, 2017, the Company repurchased an additional 1.0 million shares for $75 million
  • Net interest expense in the fourth quarter of 2016 was $32 million, compared with $35 million in the fourth quarter of 2015. This reflects a larger proportion of lower cost variable debt partially offset by higher debt levels.
  • Depreciation and amortization in the fourth quarter of 2016 was $65 million, compared with $61 million in the fourth quarter of 2015, reflecting new projects that were placed into service. 

Balance Sheet Information as of December 31, 2016:

  • Cash and cash equivalents of $185 million, compared with $171 million at December 31, 2015
  • Vacation ownership contract receivables, net, of $2.8 billion, compared with $2.7 billion at December 31, 2015
  • Vacation ownership and other inventory of $1.4 billion, compared with $1.3 billion at December 31, 2015
  • Securitized vacation ownership debt of $2.1 billion, unchanged from December 31, 2015
  • Long-term debt of $3.4 billion, compared with $3.1 billion at December 31, 2015. The remaining borrowing capacity on the revolving credit facility, net of commercial paper borrowings, was $1.1 billion as of December 31, 2016, compared with $1.4 billion at December 31, 2015.

A schedule of debt is included in Table 12 of this press release.

OUTLOOK

Note to Editors: The guidance excludes possible future share repurchases, while analysts' estimates often include share repurchases. This results in discrepancies between Company guidance and database consensus forecasts.

The Company provides the following guidance for the full year 2017:

  • Revenues of approximately $5.80 billion to $5.95 billion
  • Adjusted net income of approximately $637 million to $658 million
  • Adjusted EBITDA of approximately $1.41 billion to $1.44 billion
  • Adjusted diluted EPS of approximately $5.90 to $6.10 based on a diluted share count of 108 million

In determining adjusted EBITDA, adjusted net income and adjusted EPS, the Company excludes certain items which are otherwise included in determining the comparable GAAP financial measures. A description of the adjustments that have been applicable for the reported periods in determining adjusted net income, adjusted EBITDA and adjusted EPS are reflected in Tables 7 and 8 of this press release. The Company is providing an outlook for net income, EPS and EBITDA only on a non-GAAP basis because the Company is unable to predict with reasonable certainty the totality or ultimate outcome or occurrence of these adjustments for the outlook period, which can be dependent on future events that may not be reliably predicted. See Table 10 for certain non-GAAP information concerning the outlook period.

The Company will post full guidance information on its website following the conference call.

CONFERENCE CALL INFORMATION
Wyndham Worldwide Corporation will hold a conference call with investors to discuss the Company's results, outlook and guidance on Wednesday, February 15, 2017 at 8:30 a.m. ET. Listeners can access the webcast live through the Company's website at http://www.wyndhamworldwide.com/investors/.  The conference call may also be accessed by dialing 888-632-3384 and providing the pass code "WYNDHAM."  Listeners are urged to call at least 10 minutes prior to the scheduled start time.  An archive of this webcast will be available on the website for approximately 90 days beginning at 12:00 p.m. ET on February 15, 2017.  A telephone replay will be available for approximately 10 days beginning at 12:00 p.m. ET on February 15, 2017 at 800-839-0866.

PRESENTATION OF FINANCIAL INFORMATION
Financial information discussed in this press release includes non-GAAP measures, which include or exclude certain items. These non-GAAP measures differ from reported GAAP results and are intended to illustrate what management believes are relevant period-over-period comparisons and are helpful to investors as an additional tool for further understanding and assessing the Company's ongoing operating performance.  Exclusion of items in the Company's non-GAAP presentation should not be considered an inference that these items are unusual, infrequent or non-recurring.  Full reconciliations of GAAP results to the comparable non-GAAP measures for the reported periods appear in the financial tables section of the press release.

ABOUT WYNDHAM WORLDWIDE
Wyndham Worldwide (NYSE: WYN) is one of the largest global hospitality companies, providing travelers with access to a collection of trusted hospitality brands in hotels, vacation ownership, and unique accommodations including vacation exchange, holiday parks, and managed home rentals. With a collective inventory of nearly 130,000 places to stay across more than 110 countries on six continents, Wyndham Worldwide and its 38,000 associates welcomes people to experience travel the way they want. This is enhanced by Wyndham Rewards®, the Company's re-imagined guest loyalty program across its businesses, which is making it simpler for members to earn more rewards and redeem their points faster. For more information, please visit www.wyndhamworldwide.com.

FORWARD-LOOKING STATEMENTS
This press release contains "forward-looking statements" within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended, conveying management's expectations as to the future based on plans, estimates and projections at the time the Company makes the statements.  Forward-looking statements involve known and unknown risks, uncertainties and other factors, which may cause the actual results, performance or achievements of the Company to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements.  The forward-looking statements contained in this press release include statements related to the Company's revenues, earnings, cash flow, dividends, and related financial and operating measures.

You are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of this press release.  Factors that could cause actual results to differ materially from those in the forward-looking statements include general economic conditions, the performance of the financial and credit markets, the economic environment for the hospitality industry, the impact of war, terrorist activity or political strife, operating risks associated with the hotel, vacation exchange and rentals and vacation ownership businesses, as well as those described in the Company's Annual Report on Form 10-K, filed with the SEC on February 12, 2016.  Except for the Company's ongoing obligations to disclose material information under the federal securities laws, it undertakes no obligation to release publicly any revisions to any forward-looking statements, to report events or to report the occurrence of unanticipated events.

 

 

Wyndham Worldwide Corporation

Earnings Release Schedules

Quarter Four - December 31, 2016

Table of Contents




Table No.



Consolidated Statements of Income (Unaudited)

1



Operating Results of Reportable Segments

2



Operating Statistics

3



Condensed Consolidated Statements of Cash Flows and Reconciliation of Free Cash Flows (Unaudited)

4



Revenue Detail by Reportable Segment

5



Brand System Details

6



Non-GAAP Reconciliation of Adjusted Net Income and EPS

7



Non-GAAP Reconciliation of Adjusted EBITDA by Reportable Segment

8



Non-GAAP Reconciliation of Gross VOI Sales

9



Non-GAAP Reconciliation of 2017 Outlook

10



Non-GAAP Reconciliation - Constant Currency and Currency Neutral

11



Schedule of Debt

12

 

 















Table 1

Wyndham Worldwide Corporation

CONSOLIDATED STATEMENTS OF INCOME

(In millions, except per share data)

(Unaudited)



































 Three Months Ended 


 Twelve Months Ended 





 December 31, 


 December 31, 





2016


2015


2016


2015

Net revenues














Service and membership fees


$

550


$

562


$

2,552


$

2,519


Vacation ownership interest sales



415



403



1,606



1,604


Franchise fees



164



157



677



674


Consumer financing



113



109



440



427


Other




78



80



324



312

Net revenues



1,320



1,311



5,599



5,536
















Expenses















Operating



597



594



2,511



2,461


Cost of vacation ownership interests 



31



43



146



165


Consumer financing interest



19



19



75



74


Marketing and reservation



184



189



829



813


General and administrative



169



199



714



761


Loss on sale and asset impairment



-



-



-



7


Restructuring



1



(2)



15



6


Depreciation and amortization



65



61



252



234

Total expenses



1,066



1,103



4,542



4,521
















Operating income



254



208



1,057



1,015

Other (income)/expense, net



(3)



(6)



(22)



(17)

Interest expense



34



37



136



125

Early extinguishment of debt



-



-



11



-

Interest income



(2)



(2)



(8)



(9)
















Income before income taxes



225



179



940



916

Provision for income taxes



61



39



328



304

Net income




164



140



612



612

Net income attributable to noncontrolling interest


-



-



(1)



-

Net income attributable to Wyndham shareholders

$

164


$

140


$

611


$

612
















Earnings per share














Basic



$

1.54


$

1.22


$

5.56


$

5.18


Diluted



1.53



1.21



5.53



5.14
















Weighted average shares outstanding














Basic




107



115



110



118


Diluted



108



116



111



119

 

 














Table 2















(1 of 2)


Wyndham Worldwide Corporation

OPERATING RESULTS OF REPORTABLE SEGMENTS

(In millions)































In addition to other measures, management evaluates the operating results of each of its reportable segments based upon net revenues and "EBITDA", which is defined as net income before depreciation and amortization, interest expense (excluding consumer financing interest), early extinguishment of debt, interest income (excluding consumer financing revenues) and income taxes, each of which is presented on the Company's Consolidated Statements of Income.  The Company also uses adjusted EBITDA as a financial measure of its operating performance.  The Company believes that EBITDA and Adjusted EBITDA are useful measures of assessing performance of the Company and for the Company's segments which, when considered with GAAP measures, give a more complete understanding of its operating performance and assist our investors in evaluating our ongoing operating performance for the current reporting period and, where provided, over different reporting periods, by adjusting for certain items which may be recurring or nonrecurring and which in our view do not necessarily reflect ongoing operating performance. We also internally use these measures to assess our operating performance, both in absolute terms and in comparison to other companies, and in evaluating or making selected compensation decisions.  These supplemental disclosures are in addition to GAAP reported measures.  The Company's presentation of EBITDA and adjusted EBITDA may not be comparable to similarly-titled measures used by other companies.






















The following tables summarize net revenues and EBITDA for the Company's reportable segments, as well as reconcile EBITDA to net income for the three months ended December 31, 2016 and 2015:




















Three Months Ended December 31, 





2016


2015





 Net Revenues 


 EBITDA 


 Net Revenues 


 EBITDA 


Hotel Group

$

316


$

99


$

314


$

94


Destination Network


317



53



310



44


Vacation Ownership


705



182



706



174


     Total Reportable Segments


1,338



334



1,330



312


Corporate and Other (a)


(18)



(12)



(19)



(37)


     Total Company

$

1,320


$

322


$

1,311


$

275

















Reconciliation of EBITDA to net income


































 Three Months Ended December 31,  








2016





2015


EBITDA





$

322





$

275


Depreciation and amortization





65






61


Interest expense





34






37


Interest income





(2)






(2)


Income before income taxes





225






179


Provision for income taxes





61






39


Net income





$

164





$

140
































(a) Includes the elimination of transactions between segments.  
















The following tables summarize net revenues and adjusted EBITDA for the Company's reportable segments for the three months ended December 31, 2016 and 2015 (for a description of adjustments and reconciliation by segment, see Table 8):





















Three Months Ended December 31, 





2016


2015







Adjusted 




Adjusted 





 Net Revenues 


 EBITDA 


 Net Revenues 


 EBITDA 


Hotel Group

$

316


$

99


$

314


$

93


Destination Network


317



52



310



43


Vacation Ownership


705



191



706



174


     Total Reportable Segments


1,338



342



1,330



310


Corporate and Other (a)


(18)



(24)



(19)



(37)


     Total Company

$

1,320


$

318


$

1,311


$

273

















 

 

 














Table 2















(2 of 2)


Wyndham Worldwide Corporation


OPERATING RESULTS OF REPORTABLE SEGMENTS


(In millions)
































The following tables summarize net revenues and EBITDA for the Company's reportable segments, as well as reconcile EBITDA to net income attributable to Wyndham shareholders for the twelve months ended December 31, 2016 and 2015:




















Twelve Months Ended December 31, 





2016


2015





 Net Revenues 


 EBITDA 


 Net Revenues 


 EBITDA 


Hotel Group

$

1,309


$

391


$

1,297


$

349


Destination Network


1,571



356



1,538



367


Vacation Ownership


2,794



694



2,772



687


     Total Reportable Segments


5,674



1,441



5,607



1,403


Corporate and Other (a)


(75)



(110)



(71)



(137)


     Total Company

$

5,599


$

1,331


$

5,536


$

1,266

















Reconciliation of EBITDA to net income attributable to Wyndham shareholders






















Twelve Months Ended December 31, 








2016





2015


EBITDA





$

1,331





$

1,266


Depreciation and amortization





252






234


Interest expense





136






125


Early extinguishment of debt





11






-


Interest income





(8)






(9)


Income before income taxes





940






916


Provision for income taxes





328






304


Net income






612






612


Net income attributable to noncontrolling interest





(1)






-


Net income attributable to Wyndham shareholders




$

611





$

612
































(a) Includes the elimination of transactions between segments.  





The following tables summarize net revenues and adjusted EBITDA for the Company's reportable segments for the twelve months ended December 31, 2016 and 2015 (for a description of adjustments and reconciliation by segment, see Table 8):





















Twelve Months Ended December 31, 





2016


2015







Adjusted 




Adjusted 





 Net Revenues 


 EBITDA 


 Net Revenues 


 EBITDA 


Hotel Group

$

1,309


$

401


$

1,297


$

376


Destination Network


1,571



385



1,538



370


Vacation Ownership


2,794



708



2,772



688


     Total Reportable Segments


5,674



1,494



5,607



1,434


Corporate and Other (a)


(75)



(121)



(71)



(137)


     Total Company

$

5,599


$

1,373


$

5,536


$

1,297

















 

















Table 3

















(1 of 2)

Wyndham Worldwide Corporation

OPERATING STATISTICS


















The following operating statistics are the drivers of our revenues and therefore provide an enhanced understanding of our businesses:
























Year


Q1


Q2


Q3


Q4


Full Year

Hotel Group(a)













Number of Rooms 

2016


679,100


683,300


689,800


697,600


 N/A 



2015


667,400


668,500


671,900


678,000


 N/A 



2014


646,900


650,200


655,300


660,800


 N/A 



2013


631,800


635,100


638,300


645,400


 N/A 















RevPAR

2016

$

31.59

$

39.10

$

43.04

$

32.92

$

36.67



2015

$

32.84

$

39.82

$

43.34

$

32.98

$

37.26



2014

$

32.30

$

40.11

$

43.71

$

34.06

$

37.57



2013

$

31.05

$

38.00

$

41.78

$

33.07

$

36.00














Destination Network













Average Number of Members (in 000s)

2016


3,841


3,857


3,868


3,843


3,852



2015


3,822


3,831


3,835


3,836


3,831



2014


3,727


3,748


3,777


3,808


3,765



2013


3,668


3,686


3,711


3,728


3,698















Exchange Revenue Per Member

2016

$

189.78

$

164.61

$

164.39

$

151.19

$

167.48



2015

$

194.06

$

167.81

$

163.38

$

152.00

$

169.29



2014

$

200.78

$

179.17

$

171.77

$

157.24

$

177.12



2013

$

210.96

$

182.42

$

169.95

$

161.21

$

181.02















Vacation Rental Transactions (in 000s) (a) (b)

2016


500


409


508


350


1,767



2015


459


390


462


319


1,630



2014


429


376


455


293


1,552



2013


423


355


433


273


1,483















Average Net Price Per Vacation Rental(a) (b)

2016

$

366.08

$

492.83

$

599.59

$

430.14

$

475.24



2015

$

361.20

$

513.14

$

642.00

$

452.19

$

494.92



2014

$

410.04

$

577.13

$

727.40

$

492.25

$

558.95



2013

$

392.64

$

540.38

$

677.81

$

506.62

$

532.11














Vacation Ownership (a)













Gross Vacation Ownership Interest (VOI) Sales (in 000s) (c)

2016

$

428,000

$

518,000

$

564,000

$

502,000

$

2,012,000



2015

$

390,000

$

502,000

$

565,000

$

507,000

$

1,965,000



2014

$

410,000

$

496,000

$

513,000

$

470,000

$

1,889,000



2013

$

384,000

$

481,000

$

536,000

$

488,000

$

1,889,000















Tours (in 000s)

2016


179


213


230


197


819



2015


168


206


227


200


801



2014


170


208


225


191


794



2013


163


206


225


195


789















Volume Per Guest (VPG)

2016

$

2,244

$

2,328

$

2,320

$

2,399

$

2,324



2015

$

2,177

$

2,353

$

2,354

$

2,390

$

2,326



2014

$

2,272

$

2,280

$

2,158

$

2,336

$

2,257



2013

$

2,211

$

2,256

$

2,278

$

2,370

$

2,281


















Note: Full year amounts may not add across due to rounding.

(a)

Includes the impact of acquisitions/dispositions from the acquisition/disposition dates forward. Therefore, the operating statistics are not presented on a comparable basis.

(b)

The destination network operating statistics excluding our U.K.-based camping business sold in Q4 2014 are as follows:
























Year


Q1


Q2


Q3


Q4


Full Year


Vacation Rental Transactions (in 000s)

2014


429


367


431


292


1,518


Average Net Price Per Vacation Rental

2014

$

410.02

$

578.02

$

700.56

$

492.64

$

548.93



































(c)

Includes Gross VOI sales under the Company's Wyndham Asset Affiliate Model (WAAM) Just-in-Time. (See Table 9 for a reconciliation of Gross VOI sales to vacation ownership interest sales).








































ADDITIONAL DATA
































Year


Q1


Q2


Q3


Q4


Full Year

Hotel Group













Number of Properties

2016


7,830


7,880


7,930


8,040


 N/A 



2015


7,670


7,700


7,760


7,810


 N/A 



2014


7,500


7,540


7,590


7,650


 N/A 



2013


7,380


7,410


7,440


7,490


 N/A 














Vacation Ownership













Provision for Loan Losses (in 000s) (*) 

2016

$

63,000

$

90,000

$

104,000

$

86,000

$

342,000



2015

$

46,000

$

60,000

$

78,000

$

64,000

$

248,000



2014

$

60,000

$

70,000

$

70,000

$

60,000

$

260,000



2013

$

84,000

$

90,000

$

102,000

$

73,000

$

349,000


















Note: Full year amounts may not add across due to rounding.

(*)

Represents provision for estimated losses on vacation ownership contract receivables originated during the period, which is recorded as a contra revenue to vacation ownership interest sales on the Consolidated Statements of Income.

 

 

 

















Table 3


















(2 of 2)




















Wyndham Worldwide Corporation


OPERATING STATISTICS




GLOSSARY OF TERMS




















Hotel Group




















Number of Rooms: Represents the number of rooms at hotel group properties at the end of the period which are either (i) under franchise and/or management agreements, or company owned and (ii) properties under affiliation agreements for which the Company receives a fee for reservation and/or other services provided. 





















Average Occupancy Rate: Represents the percentage of available rooms occupied during the period.




















Average Daily Rate (ADR): Represents the average rate charged for renting a lodging room for one day. 




















RevPAR:  Represents revenue per available room and is calculated by multiplying average occupancy rate by ADR. Comparable RevPAR represents RevPAR of hotels which are included in both periods.





















Destination Network




















Average Number of Members:  Represents members in our vacation exchange programs who paid annual membership dues as of the end of the period or who are within the allowed grace period. For additional fees, such participants are entitled to exchange intervals for intervals at other properties affiliated with the Company's vacation exchange business. In addition, certain participants may exchange intervals for other leisure-related services and products.






















Exchange Revenue Per Member: Represents total annualized revenues generated from fees associated with memberships, exchange transactions, member-related rentals and other servicing for the period divided by the average number of vacation exchange members during the period. 





















Vacation Rental Transactions:  Represents the number of transactions that are generated in connection with customers booking their vacation rental stays through one of our vacation brands. One rental transaction is recorded for each standard one-week rental.





















Average Net Price Per Vacation Rental: Represents the net rental price generated from renting vacation properties to customers and other related rental servicing fees divided by the number of vacation rental transactions.





















Vacation Ownership




















Gross Vacation Ownership Interest Sales: Represents sales of vacation ownership interest (VOIs), including WAAM sales, before the net effect of percentage-of-completion accounting and loan loss provisions. We believe gross VOI sales provide an enhanced understanding of the performance of our vacation ownership business because it directly measures the sales volume of this business during a given reporting period. See Table 9 for a reconciliation of Gross VOI sales to vacation ownership interest sales.





















Tours: Represents the number of tours taken by guests in our efforts to sell VOIs.




















Volume per Guest (VPG): Represents Gross VOI sales (excluding tele-sales upgrades, which are non-tour upgrade sales) divided by the number of tours.  The Company has excluded non-tour upgrade sales in the calculation of VPG because non-tour upgrade sales are generated by a different marketing channel.  See Table 9 for a detail of tele-sales upgrades for 2013-2016. 






















General




















Constant Currency: Represents a comparison eliminating the effects of foreign exchange rate fluctuations between periods (foreign currency translation).




















Currency-Neutral: Represents a comparison eliminating the effects of foreign exchange rate fluctuations between periods (foreign currency translation) and the impact caused by any foreign exchange related activities (i.e., hedges, balance sheet remeasurements and/or adjustments).



 

 

 








Table 4

Wyndham Worldwide Corporation

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS AND RECONCILIATION OF FREE CASH FLOWS

(In millions)

(Unaudited)

















Condensed Consolidated Statements of Cash Flows:










Twelve Months Ended December 31, 




2016


2015

Net cash provided by operating activities


$

973


$

991









Net cash used in investing activities



(353)



(302)









Net cash used in financing activities



(586)



(675)









Effect of changes in exchange rates on cash and cash equivalents



(20)



(26)









Net increase / (decrease) in cash and cash equivalents


$

14


$

(12)

















Free Cash Flow:
















We define free cash flow to be net cash provided by operating activities less property and equipment additions which we also refer to as capital expenditures.


We believe free cash flow to be a useful operating performance measure to evaluate the ability of our operations to generate cash for uses other than capital expenditures and, after debt service and other obligations, our ability to grow our business through acquisitions, development advances and equity investments, as well as our ability to return cash to shareholders through dividends and share repurchases. A limitation of using free cash flow versus the GAAP measures of net cash provided by operating activities, net cash used in investing activities and net cash used in financing activities as a means for evaluating Wyndham Worldwide is that free cash flow does not represent the total cash movement for the period as detailed in the consolidated statement of cash flows.


The following table provides more details on the GAAP financial measure that is most directly comparable to the non-GAAP financial measure and the related reconciliation between these financial measures:





Twelve Months Ended December 31, 




2016


2015

Net cash provided by operating activities


$

973


$

991

Less: Property and equipment additions



(191)



(222)

Free cash flow



$

782


$

769









 

 

 

























Table 5


























Wyndham Worldwide Corporation

REVENUE DETAIL BY REPORTABLE SEGMENT

(In millions)























































2016


2015






 Q1 


 Q2 


 Q3 


 Q4 


 Year 



 Q1 


 Q2 


 Q3 


 Q4 


 Year 

Hotel Group
























Royalties and Franchise Fees


$

74

$

94

$

105

$

94

$

367


$

74

$

96

$

103

$

87

$

361


Marketing, Reservation and Wyndham Rewards Revenues (a)


83


103


125


92


405



96


108


112


92


407


Hotel Management Reimbursable Revenues (b)


67


71


67


65


271



61


71


73


68


273


Intersegment Trademark Fees



13


15


16


14


56



12


15


16


15


57


Owned Hotel Revenues



27


19


17


17


81



25


20


16


19


79


Ancillary Revenues (c)



31


32


34


34


129



24


24


37


33


120


Total Hotel Group



295


334


364


316


1,309



292


334


357


314


1,297


























Destination Network
























Exchange Revenues



182


159


159


145


645



185


161


157


146


649


Rental Revenues



183


202


304


151


840



166


200


296


144


807


Ancillary Revenues (d)



20


23


23


21


86



18


22


23


20


82


Total Destination Network



385


384


486


317


1,571



369


383


476


310


1,538


























Vacation Ownership
























Vacation Ownership Interest Sales



342


409


441


415


1,606



336


417


448


403


1,604


Consumer Financing



107


108


112


113


440



104


105


108


109


427


Property Management Fees and Reimbursable Revenues


164


161


168


168


660



153


149


159


155


615


WAAM Fee-for-Service Commissions


17


16


13


-


46



12


19


23


28


83


Ancillary Revenues (e)



11


11


10


9


42



12


9


12


11


43


Total Vacation Ownership



641


705


744


705


2,794



617


699


750


706


2,772

Total Reportable Segments


$

1,321

$

1,423

$

1,594

$

1,338

$

5,674


$

1,278

$

1,416

$

1,583

$

1,330

$

5,607























































2014


2013






 Q1 


 Q2 


 Q3 


 Q4 


 Year 



 Q1 


 Q2 


 Q3 


 Q4 


 Year 

Hotel Group
























Royalties and Franchise Fees


$

68

$

88

$

100

$

83

$

339


$

64

$

79

$

91

$

75

$

309


Marketing, Reservation and Wyndham Rewards Revenues (a)


76


101


117


91


385



73


92


118


83


365


Hotel Management Reimbursable Revenues (b)


37


39


39


39


154



25


38


37


35


135


Intersegment Trademark Fees



9


11


11


10


41



8


10


11


10


39


Owned Hotel Revenues



24


20


18


20


81



26


20