Wyndham Destinations (WYND) Tops Q4 EPS by 2c, Revenues Miss; Offers FY20 EPS Guidance Below Consensus, FY20 Revenue Mid-Point Views Below Consensus

Wyndham Destinations (NYSE: WYND) reported Q4 EPS of $1.58, $0.02 better than the analyst estimate of $1.56. Revenue for the quarter came in at $981 million versus the consensus estimate of $1.03 billion.

• Net VOI sales increased 4% to $464 million; gross VOI sales increased 3% to $582 million in the fourth quarter
• Fourth quarter GAAP diluted EPS from continuing operations increased 57% to $1.73
• Adjusted diluted EPS from continuing operations in the fourth quarter increased 24% to $1.58
• Net income from continuing operations increased 46% to $155 million and adjusted net income from continuing operations increased 15% to $142 million in the fourth quarter
• Fourth quarter adjusted EBITDA increased 10% to $265 million (1)
• Delivered full-year net cash provided by operating activities from continuing operations of $453 million (55% increase) and adjusted free cash flow from continuing operations of $617 million (6% increase)
• Repurchased 7.6 million shares of common stock for $340 million in 2019
• Full-year 2020 Adjusted EBITDA is projected to be between $1.03 billion and $1.05 billion
• The Board of Directors authorized an 11% increase in the quarterly dividend to $0.50 per share

Michael D. Brown, president and CEO of Wyndham Destinations, noted, "In our first full year as a standalone public company, Wyndham Destinations delivered on our promise to provide value to shareholders through steady growth, strong margins and robust free cash flow. We are pleased with our fourth quarter and full-year results as adjusted EBITDA, gross VOI sales and tours each grew 4% in 2019."

\"We delivered full-year adjusted free cash flow of $617 million, further demonstrating the strength in our underlying business model and our continued focus on the optimization of our balance sheet. Our business has steady momentum and we believe we\'re well-positioned for growth in 2020. As we begin the year, our priorities remain the same — delivering great vacations for our owners and members while providing strong returns for our shareholders.\"

GUIDANCE:

Wyndham Destinations sees FY2020 EPS of $5.90-$6.10, versus the consensus of $6.12. Wyndham Destinations sees FY2020 revenue of $4.04-4.14 billion, versus the consensus of $4.13 billion.

The Company is providing its full-year 2020 guidance:

• Net revenue of $4.04 billion to $4.14 billion
  • Revenue guidance includes an expected increase of $160 million in fee-for-service sales. Adjusting for the impact of fee-for-service sales, the sale of North American vacation rentals and the acquisition of ARN, comparable revenue growth over 2019 is 5% to 7%
• Adjusted EBITDA of $1.03 billion to $1.05 billion
• Adjusted diluted EPS from continuing operations of $5.90 to $6.10, based on a diluted share count of 89.2 million, which assumes no future share repurchases after December 31, 2019
• Adjusted free cash flow from continuing operations of $560 million to $580 million
• Provision for loan loss as a percentage of gross VOI sales, net of fee-for-service sales, to be around 20%

Wyndham Destinations' outlook excludes any potential impact of the COVID-19 coronavirus and is based on foreign exchange rates as of December 31, 2019. This guidance is presented only on a non-GAAP basis because not all of the information necessary for a quantitative reconciliation of forward-looking non-GAAP financial measures to the most directly comparable GAAP financial measure is available without unreasonable effort, primarily due to uncertainties relating to the occurrence or amount of these adjustments that may arise in the future. Please refer to Table 8 for further information.

For earnings history and earnings-related data on Wyndham Destinations (WYND) click here.

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