Wyndham Hotels & Resorts, Inc. (NYSE:WH) Q4 2018 Earnings Conference Call Transcript

Feb 13, 2019 • 08:30 am ET


Wyndham Hotels & Resorts, Inc. (NYSE:WH) Q4 2018 Earnings Conference Call Transcript


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Good day, and welcome to the Wyndham Hotels & Resorts Fourth Quarter and Full Year 2018 Earnings Conference Call. At this time, all participants have been placed on a listen-only mode and the floor will be open for your questions following the presentation. (Operator Instructions)

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

Matt Capuzzi

Good morning and thank you for joining us. With me today are Geoff Ballotti, our CEO; and David Wyshner, our CFO.

Before we get started, I want to remind you that our remarks today will contain forward-looking statements. These statements are subject to risk factors that may cause our actual results to differ materially from those expressed or implied. These risk factors are discussed in detail in our Form 10 and other filings with the SEC. We will also be referring to a number of non-GAAP measures. Corresponding GAAP measures and a reconciliation of non-GAAP measures to GAAP metrics are provided in our earnings release, which is available on our Investor Relations website at www.investor.wyndhamhotels.com.

Consistent with the information that we shared with you in October, our further adjusted metrics reflect what our results would have looked like if we had completed our spin-off and the acquisition and integration of La Quinta on January 1st of 2018

With that, I'll turn the call over to Geoff.

Geoff Ballotti

Thanks, Matt. Good morning, and thanks for joining us today. We capped off our first year as an independent public company by delivering solid full-year growth in rooms, RevPAR, adjusted EBITDA and adjusted diluted EPS. Just as importantly, we finished 2018 with another strong quarter where adjusted EBITDA increased 64% to $125 million and grew 16% in constant currency, excluding our 2018 acquisitions and dispositions.

Moreover, we continued to deliver organic room growth and organic RevPAR growth and system size and grow our development pipeline to a record 180,000 rooms. We accomplished a tremendous amount in 2018 and we could not be prouder of all of our team members who seamlessly kept things running through our spin, yet remained very focused on both growing earnings and growing our business.

The La Quinta transaction is proceeding very well. La Quinta's results post acquisition and in the fourth quarter have been solid with RevPAR up 3.2% in Q4 and our integration efforts progressing as planned. We remain impressed by La Quinta's amazing sales, marketing, operations support, revenue management and franchise development teams, who have smoothly transition to Wyndham. In the fourth quarter, we signed 13 new franchise agreements bringing our post acquisition La Quinta pipeline growth to 6% on an annualized basis. 27 new La Quinta's were opened in 2018 and 16 of these were new construction Del Sol prototypes.

Retention for the brand ran over 98% in 2018, and in a seven months since our acquisition, the La Quinta brand has seen a 140 basis points of average monthly RevPAR index growth. Because of its RevPAR growth, La Quinta has been