Wyndham Hotels & Resorts, Inc. (NYSE:WH) Q4 2019 Earnings Conference Call - Final Transcript

Feb 13, 2020 • 08:30 am ET


Wyndham Hotels & Resorts, Inc. (NYSE:WH) Q4 2019 Earnings Conference Call - Final Transcript


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[Operator Instructions]

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

Matt Capuzzi

Good morning, and thank you for joining us. With me today are Geoff Ballotti, our CEO; and Michele Allen, 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 most recent Annual Report on Form 10-K filed with the Securities and Exchange Commission and any subsequent reports filed 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 investor.wyndhamhotels.com. In addition, we will provide supplemental information on our website after the call. We may also use our website as a means of disclosing material non-public information from time-to-time. Such disclosures will be included on our website in the Investor section.

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

Geoffrey A. Ballotti

Thanks, Matt. Good morning and thanks, everyone, for joining us today. We are thrilled to report a strong finish to 2019. We delivered rooms growth revenue, adjusted EBITDA, and adjusted EPS all in line with our expectations. We grew adjusted EBITDA by 22% for the fourth quarter and 21% for the year. And we grew adjusted EPS by 40% in the quarter and 21% for the full year. We returned over $350 million to our shareholders in 2019 through the payment of dividends and share repurchases representing over 6% of our current market cap. And reflecting their continued confidence in our business, our Board of Directors has approved a 10% increase in our annual dividend from $0.29 to $0.32 per share beginning with a dividend that is expected to be declared in the first quarter of 2020.

Our strong financial results reflect great operating performance. In our comments today, we'll focus on those efforts across the company. But we'd like to begin by addressing the coronavirus outbreak which is presenting a challenging start to 2020 for our committed and dedicated team in China. While China represents only 2% of our adjusted EBITDA given our lower RevPAR, lower royalty Super 8 master licensee arrangement, it is becoming a more important factor to our international direct franchising business.

The 60 government mandated hotel closures we saw in the first week of the outbreak peaked last weekend at a 1,000 of our [Technical Issue] China. Approximately, 900 of the 1,000 closures are Super 8 master licensee franchisees. Hotel closures appeared to be stabilizing and we've also seen approximately 50 hotels re-opened over the past several days.

Importantly, the majority of the closures resulted from our owners and franchisees doing everything they could to protect their team members and prevent the spread of the virus.