Marriott Vacations Worldwide Corp. (NYSE:VAC) Q2 2019 Earnings Conference Call Transcript

Aug 01, 2019 • 08:30 am ET

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Marriott Vacations Worldwide Corp. (NYSE:VAC) Q2 2019 Earnings Conference Call Transcript

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Presentation
Operator
Operator

Greetings and welcome to Marriott Vacations Worldwide Second Quarter 2019 Earnings Conference Call. At this time all participants are in a listen-only mode. A question-and-answer session will follow the formal presentation. [Operator Instructions] As a reminder, this conference call is being recorded.

It is now my pleasure to turn the call over to your host, Mr. Neal Goldner, Vice President, Investor Relations. Thank you, you may begin.

Executive
Neal Goldner

Thank you, Rob and welcome to the Marriott Vacations Worldwide second quarter earnings conference call. I am joined today by Steve Weisz, President and Chief Executive Officer; and John Geller, Executive Vice President and Chief Financial and Administrative Officer. I do need to remind everyone that many of our comments today are not historical facts and are considered forward-looking statements under federal securities laws. These statements are subject to numerous risks and uncertainties as described in our SEC filings, which could cause future results to differ materially from those expressed in or implied by our comments. Forward-looking statements in the press release that we issued this morning, along with our comments on this call are effective only today, August 1st, 2019, and will not be updated as actual events unfold.

Throughout the call, we will make references to non-GAAP financial information. You can find a reconciliation of non-GAAP financial measures referred to in our remarks in the schedules attached to our press release as well as the Investor Relations page and the Financial Information page on our website at ir.mvwc.com.

It's now my pleasure to turn the call over to Steve Weisz, President and Chief Executive of Marriott Vacations Worldwide.

Executive
Stephen P. Weisz

Thanks, Neal. Good morning, everyone and thank you for joining our second quarter earnings call. I'm very pleased with our performance this quarter with contract sales growth being driven by both our legacy MVW and legacy ILG vacation ownership businesses contributing to our 17% adjusted EBITDA growth on a combined basis.

Starting with our vacation ownership business, we previously told you that we expected our legacy MVW business to deliver relatively consistent sales growth throughout 2019 and that the Vistana and Hyatt businesses would accelerate as the year progressed. That's exactly what we delivered this quarter, driving 6% higher consolidated contract sales on a combined basis with growth coming from both our legacy MVW business and the acquired Vistana and Hyatt vacation ownership businesses.

Our legacy MVW segment increased contract sales 6% in the quarter compared to the prior year. North American tours grew 3% and VPG increased 1% to $3,700. First time buyer tours increased 6%, representing approximately 45% of the total tours taken in the quarter, highlighting our focus to grow a new owner. We also saw continued growth at our newer sales distributions, including the most recent addition to our portfolio, the Marriott Vacation Club Pulse near Fisherman's Wharf, San Francisco which we opened in late May.

Moving to Legacy ILG vacation ownership, sales accelerated meaningfully compared to our first quarter. We've been working very hard integrating the business, leveraging best