Leading hospitality company
Wyndham Worldwide Corporation
) second-quarter 2013 adjusted earnings of 98 cents per share
surpassed the Zacks Consensus Estimate of 90 cents by 8.9% and
grew 12.6% year over year. Higher top line pushed up the earnings
for the quarter.
Net revenues grew 10% year over year to $1.3 billion during
the quarter, beating the Zacks Consensus Estimate of $1.2 billion
by 8.3%. Wyndham's strong Lodging as well as Vacation Ownership
businesses played a major role for augmenting the quarterly
Inside the Headline Numbers
Wyndham has three operating segments including Lodging,
Vacation Exchange and Rentals and Vacation Ownership. All the
three segments have both domestic and international
segment's revenues increased 12% year over year to $262.0 million
in the second quarter, led by a 5.3% rise in domestic revenue per
available room (RevPAR) and increased hotel management
reimbursable fees and higher revenue gains from the company-owned
Revenues from the
Vacation Exchange and Rentals
segment were up 8% year over year to $376.0 million. However, in
constant currency, segment revenues were up only 4% year over
year (acquisitions excluded).
Vacation rental revenues climbed up 13% year over year to
$192.0 million while Exchange revenues were up 4% year over year
to $168.0 million, driven by a 3% rise in exchange revenue per
Revenues from the
segment rose 11.0% year over year to $630.0 million, driven by
higher gross Vacation Ownership Interest (VOI) sales.
Gross VOI sales were up 5% year over year to $481 million,
gaining from a 10.8% rise in tour flow offsetting a 4.4% drop in
volume per guest.
In the second quarter, operating income increased annually by
4.3% to $241.0 million. The earnings before interest, taxes,
depreciation and amortization (EBITDA) grew 5.3% year over year
to $297 million during the quarter, buoyed by higher EBITDA gain
in Wyndham's Lodging, Vacation Exchange and Rentals and Vacation
At the end of the quarter, Wyndham owned 7,410 properties with
635,100 guestrooms. Additionally, 940 hotels with nearly 112,000
rooms are currently in the company's construction pipeline.
Wyndham has bought back approximately 2.9 million shares worth
$175.0 million in the second quarter. The company has also
authorized an additional $750 million for its existing share
repurchase program. Currently, it has $874 million remaining
under its share repurchase programs.
Management maintained its revenue and EBITDA guidance for
2013. Wyndham expects revenues to be within $4.925 billion -
$5.100 billion while adjusted EBITDA outlook ranges from $1.140
billion to $1.165 billion.
However, Wyndham has increased earnings guidance for 2013. The
company now projects adjusted earnings per share within $3.66 -
$3.76 in 2013, up from the previous estimate of $3.60 - $3.70 per
We are encouraged by Wyndham's performance in the second
quarter with double-digit earnings and revenue growth. With the
rise in global travel demand, revival of the North American
market and international expansion, the company continues to gain
from its Vacation Ownership and Lodging businesses. The company
recently raised its earnings guidance for 2013 which depicts the
strength in its fundamentals.
Wyndham currently carries a Zacks Rank #3 (Hold). Another
Starwood Hotels & Resorts Worldwide Inc.
) is expected to report its second-quarter earnings results on
Some other hoteliers that are currently performing well
The Marcus Corporation
Marriott Vacations Worldwide Corp.
). Both the companies carry a Zacks Rank #2 (Buy).
STARWOOD HOTELS (HOT): Free Stock Analysis
MARCUS CORP (MCS): Free Stock Analysis Report
MARRIOT VAC WW (VAC): Free Stock Analysis
WYNDHAM WORLDWD (WYN): Free Stock Analysis
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