þ
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QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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o
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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
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Delaware
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20-0052541
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(State or Other Jurisdiction
of Incorporation or Organization)
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(I.R.S. Employer
Identification No.)
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22 Sylvan Way
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07054
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Parsippany, New Jersey
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(Zip Code)
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(Address of Principal Executive Offices)
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Large accelerated filer
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þ
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Accelerated filer
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o
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Non-accelerated filer
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o
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Smaller reporting company
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o
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(Do not check if a smaller reporting company)
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Page
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PART I
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FINANCIAL INFORMATION
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Item 1.
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||
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Item 2.
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Item 3.
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Item 4.
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PART II
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OTHER INFORMATION
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Item 1.
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Item 1A.
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Item 2.
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Item 3.
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Item 4.
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Item 5.
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Item 6.
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||
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Three Months Ended
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Nine Months Ended
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||||||||||||
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September 30,
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September 30,
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||||||||||||
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2016
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2015
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2016
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|
2015
|
||||||||
Net revenues
|
|
|
|
|
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|
||||||||
Service and membership fees
|
$
|
735
|
|
|
$
|
734
|
|
|
$
|
2,001
|
|
|
$
|
1,957
|
|
Vacation ownership interest sales
|
441
|
|
|
448
|
|
|
1,191
|
|
|
1,201
|
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||||
Franchise fees
|
203
|
|
|
192
|
|
|
513
|
|
|
517
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|
||||
Consumer financing
|
112
|
|
|
108
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|
|
327
|
|
|
318
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|
||||
Other
|
82
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|
|
82
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|
|
247
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|
|
231
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||||
Net revenues
|
1,573
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|
1,564
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|
4,279
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|
|
4,224
|
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||||
Expenses
|
|
|
|
|
|
|
|
||||||||
Operating
|
679
|
|
|
691
|
|
|
1,915
|
|
|
1,865
|
|
||||
Cost of vacation ownership interests
|
47
|
|
|
43
|
|
|
115
|
|
|
123
|
|
||||
Consumer financing interest
|
19
|
|
|
18
|
|
|
55
|
|
|
55
|
|
||||
Marketing and reservation
|
242
|
|
|
218
|
|
|
645
|
|
|
624
|
|
||||
General and administrative
|
173
|
|
|
200
|
|
|
545
|
|
|
562
|
|
||||
Asset impairment
|
—
|
|
|
7
|
|
|
—
|
|
|
7
|
|
||||
Restructuring
|
14
|
|
|
8
|
|
|
14
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|
|
8
|
|
||||
Depreciation and amortization
|
63
|
|
|
59
|
|
|
187
|
|
|
173
|
|
||||
Total expenses
|
1,237
|
|
|
1,244
|
|
|
3,476
|
|
|
3,417
|
|
||||
Operating income
|
336
|
|
|
320
|
|
|
803
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|
|
807
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|
||||
Other (income)/expense, net
|
(3
|
)
|
|
(3
|
)
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(19
|
)
|
|
(11
|
)
|
||||
Interest expense
|
34
|
|
|
33
|
|
|
102
|
|
|
89
|
|
||||
Early extinguishment of debt
|
—
|
|
|
—
|
|
|
11
|
|
|
—
|
|
||||
Interest income
|
(2
|
)
|
|
(2
|
)
|
|
(6
|
)
|
|
(7
|
)
|
||||
Income before income taxes
|
307
|
|
|
292
|
|
|
715
|
|
|
736
|
|
||||
Provision for income taxes
|
110
|
|
|
102
|
|
|
267
|
|
|
265
|
|
||||
Net income
|
197
|
|
|
190
|
|
|
448
|
|
|
471
|
|
||||
Net income attributable to noncontrolling interest
|
(1
|
)
|
|
—
|
|
|
(1
|
)
|
|
—
|
|
||||
Net income attributable to Wyndham shareholders
|
$
|
196
|
|
|
$
|
190
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|
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$
|
447
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$
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471
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|
Earnings per share
|
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Basic
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$
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1.79
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|
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$
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1.62
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$
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4.03
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$
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3.96
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Diluted
|
1.78
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|
1.61
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4.01
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|
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3.93
|
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||||||||
Cash dividends declared per share
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$
|
0.50
|
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$
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0.42
|
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$
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1.50
|
|
|
$
|
1.26
|
|
|
Three Months Ended
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Nine Months Ended
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||||||||||||
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September 30,
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September 30,
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||||||||||||
|
2016
|
|
2015
|
|
2016
|
|
2015
|
||||||||
Net income
|
$
|
197
|
|
|
$
|
190
|
|
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$
|
448
|
|
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$
|
471
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|
Other comprehensive income/(loss), net of tax
|
|
|
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||||||||
Foreign currency translation adjustments
|
11
|
|
|
(39
|
)
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|
19
|
|
|
(95
|
)
|
||||
Unrealized (losses)/gains on cash flow hedges
|
(1
|
)
|
|
4
|
|
|
—
|
|
|
4
|
|
||||
Defined benefit pension plans
|
—
|
|
|
—
|
|
|
(1
|
)
|
|
—
|
|
||||
Other comprehensive income/(loss), net of tax
|
10
|
|
|
(35
|
)
|
|
18
|
|
|
(91
|
)
|
||||
Comprehensive income
|
207
|
|
|
155
|
|
|
466
|
|
|
380
|
|
||||
Net income attributable to noncontrolling interest
|
(1
|
)
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|
—
|
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|
(1
|
)
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|
—
|
|
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Comprehensive income attributable to Wyndham shareholders
|
$
|
206
|
|
|
$
|
155
|
|
|
$
|
465
|
|
|
$
|
380
|
|
|
September 30,
2016 |
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December 31,
2015 |
||||
Assets
|
|
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|
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Current assets:
|
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|
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Cash and cash equivalents
|
$
|
332
|
|
|
$
|
171
|
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Trade receivables, net
|
542
|
|
|
586
|
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Vacation ownership contract receivables, net
|
264
|
|
|
272
|
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||
Inventory
|
287
|
|
|
295
|
|
||
Prepaid expenses
|
153
|
|
|
153
|
|
||
Other current assets
|
265
|
|
|
266
|
|
||
Total current assets
|
1,843
|
|
|
1,743
|
|
||
Long-term vacation ownership contract receivables, net
|
2,496
|
|
|
2,438
|
|
||
Non-current inventory
|
1,027
|
|
|
964
|
|
||
Property and equipment, net
|
1,358
|
|
|
1,399
|
|
||
Goodwill
|
1,549
|
|
|
1,563
|
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||
Trademarks, net
|
724
|
|
|
726
|
|
||
Franchise agreements and other intangibles, net
|
380
|
|
|
397
|
|
||
Other non-current assets
|
366
|
|
|
361
|
|
||
Total assets
|
$
|
9,743
|
|
|
$
|
9,591
|
|
Liabilities and Equity
|
|
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|
||||
Current liabilities:
|
|
|
|
||||
Securitized vacation ownership debt
|
$
|
200
|
|
|
$
|
209
|
|
Current portion of long-term debt
|
33
|
|
|
44
|
|
||
Accounts payable
|
392
|
|
|
394
|
|
||
Deferred income
|
464
|
|
|
483
|
|
||
Accrued expenses and other current liabilities
|
842
|
|
|
827
|
|
||
Total current liabilities
|
1,931
|
|
|
1,957
|
|
||
Long-term securitized vacation ownership debt
|
1,898
|
|
|
1,897
|
|
||
Long-term debt
|
3,318
|
|
|
3,031
|
|
||
Deferred income taxes
|
1,198
|
|
|
1,154
|
|
||
Deferred income
|
208
|
|
|
198
|
|
||
Other non-current liabilities
|
393
|
|
|
401
|
|
||
Total liabilities
|
8,946
|
|
|
8,638
|
|
||
Commitments and contingencies (Note 12)
|
|
|
|
||||
Stockholders’ equity:
|
|
|
|
||||
Preferred stock, $.01 par value, authorized 6,000,000 shares, none issued and outstanding
|
—
|
|
|
—
|
|
||
Common stock, $.01 par value, authorized 600,000,000 shares, issued 218,162,618 shares in 2016 and 217,534,615 shares in 2015
|
2
|
|
|
2
|
|
||
Treasury stock, at cost – 110,479,733 shares in 2016 and 103,730,568 shares in 2015
|
(4,968
|
)
|
|
(4,493
|
)
|
||
Additional paid-in capital
|
3,949
|
|
|
3,923
|
|
||
Retained earnings
|
1,866
|
|
|
1,592
|
|
||
Accumulated other comprehensive loss
|
(56
|
)
|
|
(74
|
)
|
||
Total stockholders’ equity
|
793
|
|
|
950
|
|
||
Noncontrolling interest
|
4
|
|
|
3
|
|
||
Total equity
|
797
|
|
|
953
|
|
||
Total liabilities and equity
|
$
|
9,743
|
|
|
$
|
9,591
|
|
|
Nine Months Ended
|
||||||
|
September 30,
|
||||||
|
2016
|
|
2015
|
||||
Operating Activities
|
|
|
|
||||
Net income
|
$
|
448
|
|
|
$
|
471
|
|
Adjustments to reconcile net income to net cash provided by operating activities:
|
|
|
|
||||
Depreciation and amortization
|
187
|
|
|
173
|
|
||
Provision for loan losses
|
256
|
|
|
184
|
|
||
Deferred income taxes
|
73
|
|
|
32
|
|
||
Stock-based compensation
|
52
|
|
|
44
|
|
||
Excess tax benefits from stock-based compensation
|
(8
|
)
|
|
(17
|
)
|
||
Asset impairment
|
—
|
|
|
7
|
|
||
Loss on early extinguishment of debt
|
11
|
|
|
—
|
|
||
Non-cash interest
|
17
|
|
|
17
|
|
||
Net change in assets and liabilities, excluding the impact of acquisitions:
|
|
|
|
||||
Trade receivables
|
45
|
|
|
28
|
|
||
Vacation ownership contract receivables
|
(295
|
)
|
|
(213
|
)
|
||
Inventory
|
(21
|
)
|
|
(16
|
)
|
||
Prepaid expenses
|
(1
|
)
|
|
4
|
|
||
Other current assets
|
4
|
|
|
38
|
|
||
Accounts payable, accrued expenses and other current liabilities
|
46
|
|
|
75
|
|
||
Deferred income
|
(18
|
)
|
|
(12
|
)
|
||
Other, net
|
(10
|
)
|
|
2
|
|
||
Net cash provided by operating activities
|
786
|
|
|
817
|
|
||
Investing Activities
|
|
|
|
||||
Property and equipment additions
|
(136
|
)
|
|
(157
|
)
|
||
Net assets acquired, net of cash acquired
|
(37
|
)
|
|
(97
|
)
|
||
Payments of development advance notes
|
(6
|
)
|
|
(7
|
)
|
||
Proceeds from development advance notes
|
2
|
|
|
7
|
|
||
Equity investments and loans
|
(11
|
)
|
|
(12
|
)
|
||
Proceeds from asset sales
|
15
|
|
|
24
|
|
||
Decrease in securitization restricted cash
|
4
|
|
|
3
|
|
||
Increase in escrow deposit restricted cash
|
(2
|
)
|
|
(8
|
)
|
||
Other, net
|
(1
|
)
|
|
3
|
|
||
Net cash used in investing activities
|
(172
|
)
|
|
(244
|
)
|
||
Financing Activities
|
|
|
|
||||
Proceeds from securitized borrowings
|
1,497
|
|
|
1,204
|
|
||
Principal payments on securitized borrowings
|
(1,506
|
)
|
|
(1,259
|
)
|
||
Proceeds from long-term debt
|
75
|
|
|
82
|
|
||
Principal payments on long-term debt
|
(114
|
)
|
|
(128
|
)
|
||
Proceeds from/(repayments of) commercial paper, net
|
295
|
|
|
(102
|
)
|
||
Proceeds from term loan and notes issued
|
325
|
|
|
348
|
|
||
Repurchase of notes
|
(327
|
)
|
|
—
|
|
||
Proceeds from vacation ownership inventory arrangements
|
20
|
|
|
65
|
|
||
Repayments of vacation ownership inventory arrangements
|
(26
|
)
|
|
(5
|
)
|
||
Dividends to shareholders
|
(169
|
)
|
|
(153
|
)
|
||
Repurchase of common stock
|
(469
|
)
|
|
(485
|
)
|
||
Excess tax benefits from stock-based compensation
|
8
|
|
|
17
|
|
||
Debt issuance costs
|
(15
|
)
|
|
(16
|
)
|
||
Net share settlement of incentive equity awards
|
(34
|
)
|
|
(42
|
)
|
||
Other, net
|
(2
|
)
|
|
(3
|
)
|
||
Net cash used in financing activities
|
(442
|
)
|
|
(477
|
)
|
||
Effect of changes in exchange rates on cash and cash equivalents
|
(11
|
)
|
|
(20
|
)
|
||
Net increase in cash and cash equivalents
|
161
|
|
|
76
|
|
||
Cash and cash equivalents, beginning of period
|
171
|
|
|
183
|
|
||
Cash and cash equivalents, end of period
|
$
|
332
|
|
|
$
|
259
|
|
|
Common Shares Outstanding
|
|
Common Stock
|
|
Treasury Stock
|
|
Additional Paid-in Capital
|
|
Retained Earnings
|
|
Accumulated Other Comprehensive (Loss)/ Income
|
|
Non-controlling Interest
|
|
Total Equity
|
|||||||||||||||
Balance as of December 31, 2015
|
114
|
|
|
$
|
2
|
|
|
$
|
(4,493
|
)
|
|
$
|
3,923
|
|
|
$
|
1,592
|
|
|
$
|
(74
|
)
|
|
$
|
3
|
|
|
$
|
953
|
|
Net income
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
447
|
|
|
—
|
|
|
1
|
|
|
448
|
|
|||||||
Other comprehensive income
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
18
|
|
|
—
|
|
|
18
|
|
|||||||
Issuance of shares for RSU vesting
|
1
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||
Net share settlement of incentive equity awards
|
—
|
|
|
—
|
|
|
—
|
|
|
(34
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(34
|
)
|
|||||||
Change in deferred compensation
|
—
|
|
|
—
|
|
|
—
|
|
|
52
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
52
|
|
|||||||
Change in deferred compensation for Board of Directors
|
—
|
|
|
—
|
|
|
—
|
|
|
1
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1
|
|
|||||||
Repurchase of common stock
|
(7
|
)
|
|
—
|
|
|
(475
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(475
|
)
|
|||||||
Change in excess tax benefit on equity awards
|
—
|
|
|
—
|
|
|
—
|
|
|
8
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
8
|
|
|||||||
Dividends
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(173
|
)
|
|
—
|
|
|
—
|
|
|
(173
|
)
|
|||||||
Other
|
—
|
|
|
—
|
|
|
—
|
|
|
(1
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1
|
)
|
|||||||
Balance as of September 30, 2016
|
108
|
|
|
$
|
2
|
|
|
$
|
(4,968
|
)
|
|
$
|
3,949
|
|
|
$
|
1,866
|
|
|
$
|
(56
|
)
|
|
$
|
4
|
|
|
$
|
797
|
|
|
Common Shares Outstanding
|
|
Common Stock
|
|
Treasury Stock
|
|
Additional Paid-in Capital
|
|
Retained Earnings
|
|
Accumulated Other Comprehensive Income/(Loss)
|
|
Non-controlling Interest
|
|
Total Equity
|
|||||||||||||||
Balance as of December 31, 2014
|
121
|
|
|
$
|
2
|
|
|
$
|
(3,843
|
)
|
|
$
|
3,889
|
|
|
$
|
1,183
|
|
|
$
|
24
|
|
|
$
|
2
|
|
|
$
|
1,257
|
|
Net income
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
471
|
|
|
—
|
|
|
—
|
|
|
471
|
|
|||||||
Other comprehensive loss
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(91
|
)
|
|
—
|
|
|
(91
|
)
|
|||||||
Issuance of shares for RSU vesting
|
1
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||
Net share settlement of incentive equity awards
|
—
|
|
|
—
|
|
|
—
|
|
|
(42
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(42
|
)
|
|||||||
Change in deferred compensation
|
—
|
|
|
—
|
|
|
—
|
|
|
44
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
44
|
|
|||||||
Repurchase of common stock
|
(6
|
)
|
|
—
|
|
|
(485
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(485
|
)
|
|||||||
Change in excess tax benefit on equity awards
|
—
|
|
|
—
|
|
|
—
|
|
|
17
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
17
|
|
|||||||
Dividends
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(153
|
)
|
|
—
|
|
|
—
|
|
|
(153
|
)
|
|||||||
Other
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1
|
|
|
1
|
|
|||||||
Balance as of September 30, 2015
|
116
|
|
|
$
|
2
|
|
|
$
|
(4,328
|
)
|
|
$
|
3,908
|
|
|
$
|
1,501
|
|
|
$
|
(67
|
)
|
|
$
|
3
|
|
|
$
|
1,019
|
|
1.
|
Basis of Presentation
|
•
|
Hotel Group
—primarily franchises hotels in the upscale, upper midscale, midscale, economy and extended stay segments and provides hotel management services for full-service and select limited-service hotels.
|
•
|
Destination Network
—provides vacation exchange services and products to owners of intervals of vacation ownership interests (“VOIs”) and manages and markets vacation rental properties primarily on behalf of independent owners.
|
•
|
Vacation Ownership
—develops, markets and sells VOIs to individual consumers, provides consumer financing in connection with the sale of VOIs and provides property management services at resorts.
|
|
|
December 31, 2015
|
||||||||||||||
|
|
|
|
|
|
|
|
|
||||||||
|
|
Previously Reported Balance
|
|
Simplifying the Presentation of Debt Issuance Costs
|
|
Balance Sheet Classification of Deferred Taxes
|
|
Adjusted Balance
|
||||||||
Assets
|
|
|
|
|
|
|
|
|
||||||||
Current assets:
|
|
|
|
|
|
|
|
|
||||||||
Deferred income taxes
|
|
$
|
126
|
|
|
$
|
—
|
|
|
$
|
(126
|
)
|
|
$
|
—
|
|
Total current assets
|
|
1,869
|
|
|
—
|
|
|
(126
|
)
|
|
1,743
|
|
||||
Other non-current assets
|
|
360
|
|
|
(27
|
)
|
|
28
|
|
|
361
|
|
||||
Total assets
|
|
9,716
|
|
|
(27
|
)
|
|
(98
|
)
|
|
9,591
|
|
||||
|
|
|
|
|
|
|
|
|
||||||||
Liabilities and Equity
|
|
|
|
|
|
|
|
|
||||||||
Long-term securitized vacation ownership debt
|
|
$
|
1,921
|
|
|
$
|
(24
|
)
|
|
$
|
—
|
|
|
$
|
1,897
|
|
Long-term debt
|
|
3,034
|
|
|
(3
|
)
|
|
—
|
|
|
3,031
|
|
||||
Deferred income taxes
|
|
1,252
|
|
|
—
|
|
|
(98
|
)
|
|
1,154
|
|
||||
Total liabilities
|
|
8,763
|
|
|
(27
|
)
|
|
(98
|
)
|
|
8,638
|
|
||||
Total liabilities and equity
|
|
9,716
|
|
|
(27
|
)
|
|
(98
|
)
|
|
9,591
|
|
2.
|
Earnings Per Share
|
|
Three Months Ended
|
|
Nine Months Ended
|
||||||||||||
|
September 30,
|
|
September 30,
|
||||||||||||
|
2016
|
|
2015
|
|
2016
|
|
2015
|
||||||||
Net income attributable to Wyndham shareholders
|
$
|
196
|
|
|
$
|
190
|
|
|
$
|
447
|
|
|
$
|
471
|
|
Basic weighted average shares outstanding
|
109
|
|
|
117
|
|
|
111
|
|
|
119
|
|
||||
SSARs
(a)
, RSUs
(b)
and PSUs
(c)
|
1
|
|
|
1
|
|
|
1
|
|
|
1
|
|
||||
Diluted weighted average shares outstanding
|
110
|
|
|
118
|
|
|
112
|
|
|
120
|
|
||||
Earnings per share:
|
|
|
|
|
|
|
|
||||||||
Basic
|
$
|
1.79
|
|
|
$
|
1.62
|
|
|
$
|
4.03
|
|
|
$
|
3.96
|
|
Diluted
|
1.78
|
|
|
1.61
|
|
|
4.01
|
|
|
3.93
|
|
||||
Dividends:
|
|
|
|
|
|
|
|
||||||||
Aggregate dividends paid to shareholders
|
$
|
54
|
|
|
$
|
49
|
|
|
$
|
169
|
|
|
$
|
153
|
|
|
(a)
|
Excludes stock-settled appreciation rights (“SSARs”) that would have been anti-dilutive to EPS.
|
(b)
|
Includes unvested dilutive restricted stock units (“RSUs”) which are subject to future forfeitures.
|
(c)
|
Excludes
0.6 million
performance vested restricted stock units (“PSUs”) for both the three and nine months ended
September 30, 2016
and
2015
, as the Company has not met the required performance metrics.
|
|
Shares
|
|
Cost
|
|
Average Price Per Share
|
|||||
As of December 31, 2015
|
79.2
|
|
|
$
|
3,712
|
|
|
$
|
46.85
|
|
For the nine months ended September 30, 2016
|
6.8
|
|
|
475
|
|
|
70.35
|
|
||
As of September 30, 2016
|
86.0
|
|
|
$
|
4,187
|
|
|
48.70
|
|
3.
|
Acquisitions
|
4.
|
Intangible Assets
|
|
As of September 30, 2016
|
|
As of December 31, 2015
|
||||||||||||||||||||
|
Gross
Carrying
Amount
|
|
Accumulated
Amortization
|
|
Net
Carrying
Amount
|
|
Gross
Carrying
Amount
|
|
Accumulated
Amortization
|
|
Net
Carrying
Amount
|
||||||||||||
Unamortized Intangible Assets:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Goodwill
|
$
|
1,549
|
|
|
|
|
|
|
$
|
1,563
|
|
|
|
|
|
||||||||
Trademarks
|
$
|
721
|
|
|
|
|
|
|
$
|
723
|
|
|
|
|
|
||||||||
Amortized Intangible Assets:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Franchise agreements
|
$
|
594
|
|
|
$
|
397
|
|
|
$
|
197
|
|
|
$
|
594
|
|
|
$
|
386
|
|
|
$
|
208
|
|
Management agreements
|
153
|
|
|
52
|
|
|
101
|
|
|
153
|
|
|
46
|
|
|
107
|
|
||||||
Trademarks
|
9
|
|
|
6
|
|
|
3
|
|
|
8
|
|
|
5
|
|
|
3
|
|
||||||
Other
|
143
|
|
|
61
|
|
|
82
|
|
|
148
|
|
|
66
|
|
|
82
|
|
||||||
|
$
|
899
|
|
|
$
|
516
|
|
|
$
|
383
|
|
|
$
|
903
|
|
|
$
|
503
|
|
|
$
|
400
|
|
|
Balance as of December 31, 2015
|
|
Goodwill Acquired During 2016
|
|
Foreign
Exchange
|
|
Balance as of September 30, 2016
|
||||||||
|
|
|
|
||||||||||||
|
|
|
|
||||||||||||
Hotel Group
|
$
|
329
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
329
|
|
Destination Network
|
1,207
|
|
|
10
|
|
|
(24
|
)
|
|
1,193
|
|
||||
Vacation Ownership
|
27
|
|
|
—
|
|
|
—
|
|
|
27
|
|
||||
Total Company
|
$
|
1,563
|
|
|
$
|
10
|
|
|
$
|
(24
|
)
|
|
$
|
1,549
|
|
|
Three Months Ended
|
|
Nine Months Ended
|
||||||||||||
|
September 30,
|
|
September 30,
|
||||||||||||
|
2016
|
|
2015
|
|
2016
|
|
2015
|
||||||||
Franchise agreements
|
$
|
3
|
|
|
$
|
3
|
|
|
$
|
11
|
|
|
$
|
11
|
|
Management agreements
|
3
|
|
|
3
|
|
|
8
|
|
|
7
|
|
||||
Other
|
3
|
|
|
4
|
|
|
9
|
|
|
10
|
|
||||
Total
(*)
|
$
|
9
|
|
|
$
|
10
|
|
|
$
|
28
|
|
|
$
|
28
|
|
|
(*)
|
Included as a component of depreciation and amortization on the Consolidated Statements of Income.
|
|
Amount
|
||
Remainder of 2016
|
$
|
9
|
|
2017
|
37
|
|
|
2018
|
36
|
|
|
2019
|
35
|
|
|
2020
|
33
|
|
|
2021
|
32
|
|
5.
|
Vacation Ownership Contract Receivables
|
|
September 30,
2016 |
|
December 31,
2015 |
||||
Current vacation ownership contract receivables:
|
|
|
|
||||
Securitized
|
$
|
238
|
|
|
$
|
248
|
|
Non-securitized
|
84
|
|
|
81
|
|
||
Current vacation ownership receivables, gross
|
322
|
|
|
329
|
|
||
Less: Allowance for loan losses
|
58
|
|
|
57
|
|
||
Current vacation ownership contract receivables, net
|
$
|
264
|
|
|
$
|
272
|
|
Long-term vacation ownership contract receivables:
|
|
|
|
||||
Securitized
|
$
|
2,214
|
|
|
$
|
2,214
|
|
Non-securitized
|
843
|
|
|
748
|
|
||
Long-term vacation ownership receivables, gross
|
3,057
|
|
|
2,962
|
|
||
Less: Allowance for loan losses
|
561
|
|
|
524
|
|
||
Long-term vacation ownership contract receivables, net
|
$
|
2,496
|
|
|
$
|
2,438
|
|
|
Amount
|
||
Allowance for loan losses as of December 31, 2015
|
$
|
581
|
|
Provision for loan losses
|
256
|
|
|
Contract receivables write-offs, net
|
(218
|
)
|
|
Allowance for loan losses as of September 30, 2016
|
$
|
619
|
|
|
Amount
|
||
Allowance for loan losses as of December 31, 2014
|
$
|
581
|
|
Provision for loan losses
|
184
|
|
|
Contract receivables write-offs, net
|
(181
|
)
|
|
Allowance for loan losses as of September 30, 2015
|
$
|
584
|
|
|
As of September 30, 2016
|
||||||||||||||||||||||
|
700+
|
|
600-699
|
|
<600
|
|
No Score
|
|
Asia Pacific
|
|
Total
|
||||||||||||
Current
|
$
|
1,718
|
|
|
$
|
1,020
|
|
|
$
|
149
|
|
|
$
|
118
|
|
|
$
|
241
|
|
|
$
|
3,246
|
|
31 - 60 days
|
14
|
|
|
26
|
|
|
17
|
|
|
5
|
|
|
2
|
|
|
64
|
|
||||||
61 - 90 days
|
9
|
|
|
14
|
|
|
11
|
|
|
3
|
|
|
1
|
|
|
38
|
|
||||||
91 - 120 days
|
7
|
|
|
11
|
|
|
10
|
|
|
2
|
|
|
1
|
|
|
31
|
|
||||||
Total
|
$
|
1,748
|
|
|
$
|
1,071
|
|
|
$
|
187
|
|
|
$
|
128
|
|
|
$
|
245
|
|
|
$
|
3,379
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
|
As of December 31, 2015
|
||||||||||||||||||||||
|
700+
|
|
600-699
|
|
<600
|
|
No Score
|
|
Asia Pacific
|
|
Total
|
||||||||||||
Current
|
$
|
1,623
|
|
|
$
|
1,023
|
|
|
$
|
163
|
|
|
$
|
115
|
|
|
$
|
231
|
|
|
$
|
3,155
|
|
31 - 60 days
|
16
|
|
|
25
|
|
|
17
|
|
|
5
|
|
|
2
|
|
|
65
|
|
||||||
61 - 90 days
|
10
|
|
|
14
|
|
|
11
|
|
|
3
|
|
|
1
|
|
|
39
|
|
||||||
91 - 120 days
|
7
|
|
|
11
|
|
|
11
|
|
|
2
|
|
|
1
|
|
|
32
|
|
||||||
Total
|
$
|
1,656
|
|
|
$
|
1,073
|
|
|
$
|
202
|
|
|
$
|
125
|
|
|
$
|
235
|
|
|
$
|
3,291
|
|
6.
|
Inventory
|
|
September 30,
2016 |
|
December 31,
2015 |
||||
Land held for VOI development
|
$
|
146
|
|
|
$
|
136
|
|
VOI construction in process
|
64
|
|
|
62
|
|
||
Inventory sold subject to conditional repurchase
|
128
|
|
|
155
|
|
||
Completed VOI inventory
|
657
|
|
|
604
|
|
||
Estimated recoveries
|
258
|
|
|
242
|
|
||
Destination network vacation credits and other
|
61
|
|
|
60
|
|
||
Total inventory
|
1,314
|
|
|
1,259
|
|
||
Less: Current portion
(*)
|
287
|
|
|
295
|
|
||
Non-current inventory
|
$
|
1,027
|
|
|
$
|
964
|
|
|
(*)
|
Represents inventory that the Company expects to sell within the next 12 months.
|
7.
|
Long-Term Debt and Borrowing Arrangements
|
|
September 30,
2016 |
|
December 31,
2015 |
||||
Securitized vacation ownership debt
:
(a)
|
|
|
|
||||
Term notes
(b)
|
$
|
1,818
|
|
|
$
|
1,867
|
|
Bank conduit facility (due August 2018)
|
280
|
|
|
239
|
|
||
Total securitized vacation ownership debt
|
2,098
|
|
|
2,106
|
|
||
Less: Current portion of securitized vacation ownership debt
|
200
|
|
|
209
|
|
||
Long-term securitized vacation ownership debt
|
$
|
1,898
|
|
|
$
|
1,897
|
|
Long-term debt
:
(c)
|
|
|
|
||||
Revolving credit facility (due July 2020)
|
$
|
12
|
|
|
$
|
7
|
|
Commercial paper
|
404
|
|
|
109
|
|
||
Term loan (due March 2021)
|
323
|
|
|
—
|
|
||
$315 million 6.00% senior unsecured notes (due December 2016)
(d)
|
—
|
|
|
316
|
|
||
$300 million 2.95% senior unsecured notes (due March 2017)
|
300
|
|
|
299
|
|
||
$14 million 5.75% senior unsecured notes (due February 2018)
|
14
|
|
|
14
|
|
||
$450 million 2.50% senior unsecured notes (due March 2018)
|
449
|
|
|
448
|
|
||
$40 million 7.375% senior unsecured notes (due March 2020)
|
40
|
|
|
40
|
|
||
$250 million 5.625% senior unsecured notes (due March 2021)
|
247
|
|
|
247
|
|
||
$650 million 4.25% senior unsecured notes (due March 2022)
(e)
|
648
|
|
|
648
|
|
||
$400 million 3.90% senior unsecured notes (due March 2023)
(f)
|
407
|
|
|
408
|
|
||
$350 million 5.10% senior unsecured notes (due October 2025)
(g)
|
338
|
|
|
337
|
|
||
Capital leases
|
151
|
|
|
153
|
|
||
Other
|
18
|
|
|
49
|
|
||
Total long-term debt
|
3,351
|
|
|
3,075
|
|
||
Less: Current portion of long-term debt
|
33
|
|
|
44
|
|
||
Long-term debt
|
$
|
3,318
|
|
|
$
|
3,031
|
|
|
(a)
|
Represents non-recourse debt that is securitized through bankruptcy-remote special purpose entities (“SPEs”), the creditors of which have no recourse to the Company for principal and interest. These outstanding borrowings (which legally are not liabilities of the Company) are collateralized by
$2,560 million
and
$2,576 million
of underlying gross vacation ownership contract receivables and related assets (which legally are not assets of the Company) as of
September 30, 2016
and
December 31, 2015
, respectively.
|
(b)
|
The carrying amounts of the term notes are net of debt issuance costs aggregating
$24 million
as of both
September 30, 2016
and
December 31, 2015
.
|
(c)
|
The carrying amounts of the senior unsecured notes and term loan are net of unamortized discounts of
$12 million
and
$14 million
as of
September 30, 2016
and
December 31, 2015
, respectively. The carrying amounts of the senior unsecured notes and term loan are net of debt issuance costs of
$4 million
and
$3 million
as of
September 30, 2016
and
December 31, 2015
, respectively.
|
(d)
|
Includes
$1 million
of unamortized gains from the settlement of a derivative as of
December 31, 2015
.
|
(e)
|
Includes
$2 million
of unamortized gains from the settlement of a derivative as of both
September 30, 2016
and
December 31, 2015
.
|
(f)
|
Includes
$10 million
and
$11 million
of unamortized gains from the settlement of a derivative as of
September 30, 2016
and
December 31, 2015
, respectively.
|
(g)
|
Includes
$9 million
and
$10 million
of unamortized losses from the settlement of a derivative as of
September 30, 2016
and
December 31, 2015
, respectively.
|
|
Securitized Vacation Ownership Debt
|
|
Long-Term Debt
|
|
Total
|
||||||
Within 1 year
|
$
|
200
|
|
|
$
|
333
|
|
(*)
|
$
|
533
|
|
Between 1 and 2 years
|
193
|
|
|
478
|
|
|
671
|
|
|||
Between 2 and 3 years
|
430
|
|
|
26
|
|
|
456
|
|
|||
Between 3 and 4 years
|
202
|
|
|
497
|
|
|
699
|
|
|||
Between 4 and 5 years
|
215
|
|
|
542
|
|
|
757
|
|
|||
Thereafter
|
858
|
|
|
1,475
|
|
|
2,333
|
|
|||
|
$
|
2,098
|
|
|
$
|
3,351
|
|
|
$
|
5,449
|
|
|
(*)
|
Includes
$300 million
of senior unsecured notes that the Company classified as long-term debt as it has the intent to refinance such debt on a long-term basis and the ability to do so with its available capacity under the Company’s revolving credit facility.
|
|
Securitized Bank
Conduit Facility (a) |
|
Revolving
Credit Facility
|
|
||||
Total Capacity
|
$
|
650
|
|
|
$
|
1,500
|
|
|
Less: Outstanding Borrowings
|
280
|
|
|
12
|
|
|
||
Letters of credit
|
—
|
|
|
1
|
|
|
||
Commercial paper borrowings
|
—
|
|
|
404
|
|
(b)
|
||
Available Capacity
|
$
|
370
|
|
|
$
|
1,083
|
|
|
|
(a)
|
The capacity of this facility is subject to the Company’s ability to provide additional assets to collateralize additional securitized borrowings.
|
(b)
|
The Company considers outstanding borrowings under its commercial paper programs to be a reduction of the available capacity of its revolving credit facility.
|
8.
|
Variable Interest Entities
|
|
September 30,
2016 |
|
December 31,
2015 |
||||
Securitized contract receivables, gross
(a)
|
$
|
2,452
|
|
|
$
|
2,462
|
|
Securitized restricted cash
(b)
|
88
|
|
|
92
|
|
||
Interest receivables on securitized contract receivables
(c)
|
20
|
|
|
20
|
|
||
Other assets
(d)
|
4
|
|
|
5
|
|
||
Total SPE assets
|
2,564
|
|
|
2,579
|
|
||
Securitized term notes
(e) (f)
|
1,818
|
|
|
1,867
|
|
||
Securitized conduit facilities
(e)
|
280
|
|
|
239
|
|
||
Other liabilities
(g)
|
2
|
|
|
2
|
|
||
Total SPE liabilities
|
2,100
|
|
|
2,108
|
|
||
SPE assets in excess of SPE liabilities
|
$
|
464
|
|
|
$
|
471
|
|
|
(a)
|
Included in current (
$238 million
and
$248 million
as of
September 30, 2016
and
December 31, 2015
, respectively) and non-current (
$2,214 million
as of both
September 30, 2016
and
December 31, 2015
) vacation ownership contract receivables on the Consolidated Balance Sheets.
|
(b)
|
Included in other current assets (
$73 million
as of both
September 30, 2016
and
December 31, 2015
) and other non-current assets (
$15 million
and
$19 million
as of
September 30, 2016
and
December 31, 2015
, respectively) on the Consolidated Balance Sheets.
|
(c)
|
Included in trade receivables, net on the Consolidated Balance Sheets.
|
(d)
|
Primarily includes deferred financing costs for the bank conduit facility and a security investment asset, which is included in other non-current assets on the Consolidated Balance Sheets.
|
(e)
|
Included in current (
$200 million
and
$209 million
as of
September 30, 2016
and
December 31, 2015
, respectively) and long-term (
$1,898 million
and
$1,897 million
as of
September 30, 2016
and
December 31, 2015
, respectively) securitized vacation ownership debt on the Consolidated Balance Sheets.
|
(f)
|
Includes deferred financing costs of
$24 million
as of both
September 30, 2016
and
December 31, 2015
, related to securitized debt.
|
(g)
|
Primarily includes accrued interest on securitized debt, which is included in accrued expenses and other current liabilities on the Consolidated Balance Sheets.
|
|
September 30,
2016 |
|
December 31,
2015 |
||||
SPE assets in excess of SPE liabilities
|
$
|
464
|
|
|
$
|
471
|
|
Non-securitized contract receivables
|
927
|
|
|
829
|
|
||
Less: Allowance for loan losses
|
619
|
|
|
581
|
|
||
Total, net
|
$
|
772
|
|
|
$
|
719
|
|
|
September 30,
2016 |
|
December 31,
2015 |
||||
Receivable for leased property and equipment
(a)
|
$
|
16
|
|
|
$
|
47
|
|
Total SPE assets
|
16
|
|
|
47
|
|
||
Accrued expenses and other current liabilities
|
—
|
|
|
1
|
|
||
Long-term debt
(b)
|
17
|
|
|
46
|
|
||
Total SPE liabilities
|
17
|
|
|
47
|
|
||
SPE deficit
|
$
|
(1
|
)
|
|
$
|
—
|
|
|
(a)
|
Represents a receivable for assets leased to the Company which are reported within property and equipment, net on the Company’s Consolidated Balance Sheets.
|
(b)
|
As of
September 30, 2016
, included
$15 million
relating to a mortgage note due in 2017 and
$2 million
of mandatorily redeemable equity both of which are included in current portion of long-term debt on the Consolidated Balance Sheet. As of
December 31, 2015
, included
$42 million
relating to a mortgage note due in 2017 and
$4 million
of mandatorily redeemable equity;
$29 million
was included in current portion of long-term debt on the Consolidated Balance Sheet.
|
9.
|
Fair Value
|
|
September 30, 2016
|
|
December 31, 2015
|
||||||||||||
|
Carrying
Amount
|
|
Estimated Fair Value
|
|
Carrying
Amount
|
|
Estimated Fair Value
|
||||||||
Assets
|
|
|
|
|
|
|
|
||||||||
Vacation ownership contract receivables, net
|
$
|
2,760
|
|
|
$
|
3,372
|
|
|
$
|
2,710
|
|
|
$
|
3,272
|
|
Debt
|
|
|
|
|
|
|
|
||||||||
Total debt
|
5,449
|
|
|
5,595
|
|
|
5,181
|
|
|
5,234
|
|
10.
|
Derivative Instruments and Hedging Activities
|
11.
|
Income Taxes
|
12.
|
Commitments and Contingencies
|
13.
|
Accumulated Other Comprehensive (Loss)/Income
|
|
Foreign
|
|
Unrealized
|
|
Defined
|
|
|
||||||||
|
Currency
|
|
(Losses)/Gains
|
|
Benefit
|
|
|
||||||||
|
Translation
|
|
on Cash Flow
|
|
Pension
|
|
|
||||||||
Pretax
|
Adjustments
|
|
Hedges
|
|
Plans
|
|
AOCI
|
||||||||
Balance, December 31, 2015
|
$
|
(139
|
)
|
|
$
|
—
|
|
|
$
|
(9
|
)
|
|
$
|
(148
|
)
|
Period change
|
(14
|
)
|
|
—
|
|
|
(1
|
)
|
|
(15
|
)
|
||||
Balance, September 30, 2016
|
$
|
(153
|
)
|
|
$
|
—
|
|
|
$
|
(10
|
)
|
|
$
|
(163
|
)
|
Tax
|
|
|
|
|
|
|
|
||||||||
Balance, December 31, 2015
|
$
|
70
|
|
|
$
|
1
|
|
|
$
|
3
|
|
|
$
|
74
|
|
Period change
|
33
|
|
|
—
|
|
|
—
|
|
|
33
|
|
||||
Balance, September 30, 2016
|
$
|
103
|
|
|
$
|
1
|
|
|
$
|
3
|
|
|
$
|
107
|
|
Net of Tax
|
|
|
|
|
|
|
|
||||||||
Balance, December 31, 2015
|
$
|
(69
|
)
|
|
$
|
1
|
|
|
$
|
(6
|
)
|
|
$
|
(74
|
)
|
Period change
|
19
|
|
|
—
|
|
|
(1
|
)
|
|
18
|
|
||||
Balance, September 30, 2016
|
$
|
(50
|
)
|
|
$
|
1
|
|
|
$
|
(7
|
)
|
|
$
|
(56
|
)
|
|
Foreign
|
|
Unrealized
|
|
Defined
|
|
|
||||||||
|
Currency
|
|
(Losses)/Gains
|
|
Benefit
|
|
|
||||||||
|
Translation
|
|
on Cash Flow
|
|
Pension
|
|
|
||||||||
Pretax
|
Adjustments
|
|
Hedges
|
|
Plans
|
|
AOCI
|
||||||||
Balance, December 31, 2014
|
$
|
(13
|
)
|
|
$
|
(8
|
)
|
|
$
|
(12
|
)
|
|
$
|
(33
|
)
|
Period change
|
(107
|
)
|
|
7
|
|
|
—
|
|
|
(100
|
)
|
||||
Balance, September 30, 2015
|
$
|
(120
|
)
|
|
$
|
(1
|
)
|
|
$
|
(12
|
)
|
|
$
|
(133
|
)
|
Tax
|
|
|
|
|
|
|
|
||||||||
Balance, December 31, 2014
|
$
|
50
|
|
|
$
|
4
|
|
|
$
|
3
|
|
|
$
|
57
|
|
Period change
|
12
|
|
|
(3
|
)
|
|
—
|
|
|
9
|
|
||||
Balance, September 30, 2015
|
$
|
62
|
|
|
$
|
1
|
|
|
$
|
3
|
|
|
$
|
66
|
|
Net of Tax
|
|
|
|
|
|
|
|
||||||||
Balance, December 31, 2014
|
$
|
37
|
|
|
$
|
(4
|
)
|
|
$
|
(9
|
)
|
|
$
|
24
|
|
Period change
|
(95
|
)
|
|
4
|
|
|
—
|
|
|
(91
|
)
|
||||
Balance, September 30, 2015
|
$
|
(58
|
)
|
|
$
|
—
|
|
|
$
|
(9
|
)
|
|
$
|
(67
|
)
|
14.
|
Stock-Based Compensation
|
|
RSUs
|
|
PSUs
|
|
SSARs
|
|||||||||||||||
|
Number of RSUs
|
|
Weighted Average Grant Price
|
|
Number of PSUs
|
|
Weighted Average Grant Price
|
|
Number of SSARs
|
|
Weighted Average Exercise Price
|
|||||||||
Balance as of December 31, 2015
|
1.6
|
|
|
$
|
73.75
|
|
|
0.6
|
|
|
$
|
73.60
|
|
|
0.8
|
|
|
$
|
46.45
|
|
Granted
(a)
|
0.9
|
|
|
71.65
|
|
|
0.2
|
|
|
71.65
|
|
|
0.1
|
|
|
71.65
|
|
|||
Vested / exercised
|
(0.7
|
)
|
|
65.46
|
|
|
(0.2
|
)
|
|
60.24
|
|
|
(0.3
|
)
|
|
27.84
|
|
|||
Balance as of September 30, 2016
|
1.8
|
|
(b) (c)
|
75.84
|
|
|
0.6
|
|
(d)
|
77.84
|
|
|
0.6
|
|
(b) (e)
|
61.52
|
|
|
(a)
|
Primarily represents awards granted by the Company on
February 25, 2016
.
|
(b)
|
Aggregate unrecognized compensation expense related to RSUs and SSARs was
$109 million
as of
September 30, 2016
, which is expected to be recognized over a weighted average period of
2.7 years
.
|
(c)
|
Approximately
1.7
million RSUs outstanding as of
September 30, 2016
are expected to vest over time.
|
(d)
|
Maximum aggregate unrecognized compensation expense was
$27 million
as of
September 30, 2016
, which is expected to be recognized over a weighted average period of
2.0 years
.
|
(e)
|
Approximately
0.4 million
SSARs are exercisable as of
September 30, 2016
. The Company assumes that all unvested SSARs are expected to vest over time. SSARs outstanding as of
September 30, 2016
had an intrinsic value of
$7 million
and have a weighted average remaining contractual life of
3.1 years
.
|
|
SSARs Issued on
|
||
|
February 25, 2016
|
||
Grant date fair value
|
$
|
13.70
|
|
Grant date strike price
|
$
|
71.65
|
|
Expected volatility
|
27.81
|
%
|
|
Expected life
|
5.2 years
|
|
|
Risk free interest rate
|
1.33
|
%
|
|
Projected dividend yield
|
2.79
|
%
|
15.
|
Segment Information
|
|
(a)
|
Includes the elimination of transactions between segments.
|
(b)
|
Includes
$19 million
of intercompany revenues comprised of (i)
$16 million
of licensing fees for use of the Wyndham trade name, (ii)
$2 million
of other fees primarily associated with the Wyndham Rewards program and (iii)
$1 million
of room revenues at a Company owned hotel. Such revenues are offset in expenses at the Company’s Vacation Ownership segment.
|
(c)
|
Includes
$2 million
of intercompany revenues comprised of call center operations and support services provided to the Company’s Hotel Group segment.
|
(d)
|
Includes
$19 million
of intercompany revenues comprised of (i)
$16 million
of licensing fees for use of the Wyndham trade name, (ii)
$2 million
of room revenues at a Company owned hotel and (iii)
$1 million
of other fees primarily associated with the Wyndham Rewards program. Such revenues are offset in expenses at the Company’s Vacation Ownership segment.
|
|
Nine Months Ended September 30,
|
||||||||||||||
|
2016
|
|
2015
|
||||||||||||
|
Net Revenues
|
|
EBITDA
|
|
Net Revenues
|
|
EBITDA
|
||||||||
Hotel Group
|
$
|
993
|
|
(b)
|
$
|
291
|
|
|
$
|
983
|
|
(d)
|
$
|
255
|
|
Destination Network
|
1,255
|
|
(c)
|
303
|
|
|
1,228
|
|
|
323
|
|
||||
Vacation Ownership
|
2,089
|
|
|
512
|
|
|
2,067
|
|
|
513
|
|
||||
Total Reportable Segments
|
4,337
|
|
|
1,106
|
|
|
4,278
|
|
|
1,091
|
|
||||
Corporate and Other
(a)
|
(58
|
)
|
|
(97
|
)
|
|
(54
|
)
|
|
(100
|
)
|
||||
Total Company
|
$
|
4,279
|
|
|
$
|
1,009
|
|
|
$
|
4,224
|
|
|
$
|
991
|
|
|
|
|
|
|
|
|
|
||||||||
Reconciliation of EBITDA to Net income
|
|||||||||||||||
|
|
|
|
||||||||||||
|
|
|
Nine Months Ended September 30,
|
||||||||||||
|
|
|
2016
|
|
|
|
2015
|
||||||||
EBITDA
|
|
|
$
|
1,009
|
|
|
|
|
$
|
991
|
|
||||
Depreciation and amortization
|
|
|
187
|
|
|
|
|
173
|
|
||||||
Interest expense
|
|
|
102
|
|
|
|
|
89
|
|
||||||
Early extinguishment of debt
|
|
|
11
|
|
|
|
|
—
|
|
||||||
Interest income
|
|
|
(6
|
)
|
|
|
|
(7
|
)
|
||||||
Income before income taxes
|
|
|
715
|
|
|
|
|
736
|
|
||||||
Provision for income taxes
|
|
|
267
|
|
|
|
|
265
|
|
||||||
Net income
|
|
|
448
|
|
|
|
|
471
|
|
||||||
Net income attributable to noncontrolling interest
|
|
|
(1
|
)
|
|
|
|
—
|
|
||||||
Net income attributable to Wyndham shareholders
|
|
|
$
|
447
|
|
|
|
|
$
|
471
|
|
|
(a)
|
Includes the elimination of transactions between segments.
|
(b)
|
Includes
$52 million
of intercompany revenues comprised of (i)
$43 million
of intersegment licensing fees for use of the Wyndham trade name, (ii)
$6 million
of other fees primarily associated with the Wyndham Rewards program and (iii)
$3 million
of room revenues at a Company owned hotel. Such revenues are offset in expenses at the Company’s Vacation Ownership segment.
|
(c)
|
Includes
$6 million
of intercompany revenues comprised of call center operations and support services provided to the Company’s Hotel Group segment.
|
(d)
|
Includes
$54 million
of intercompany revenues comprised of (i)
$43 million
of intersegment licensing fees for use of the Wyndham trade name, (ii)
$6 million
of room revenues at a Company owned hotel and (iii)
$5 million
of other fees primarily associated with the Wyndham Rewards program. Such revenues are offset in expenses at the Company’s Vacation Ownership segment.
|
16.
|
Restructuring, Impairment and Other Charges
|
|
Personnel-related
(a)
|
|
Asset Write-offs
(b)
|
|
Total
|
||||||
Hotel Group
|
$
|
3
|
|
|
$
|
—
|
|
|
$
|
3
|
|
Destination Network
|
4
|
|
|
—
|
|
|
4
|
|
|||
Vacation Ownership
|
4
|
|
|
2
|
|
|
6
|
|
|||
Corporate
|
1
|
|
|
—
|
|
|
1
|
|
|||
|
$
|
12
|
|
|
$
|
2
|
|
|
$
|
14
|
|
|
(a)
|
Represents severance costs incurred across the Company’s businesses resulting from a reduction of
561
employees.
|
(b)
|
Represents the write-off of assets from sales office closures.
|
|
Liability as of
|
|
Costs
|
|
Cash
|
|
Other
|
|
Liability as of
|
||||||||||
|
December 31, 2015
|
|
Recognized
|
|
Payments
|
|
Non-Cash
|
|
September 30, 2016
|
||||||||||
Personnel-related
|
$
|
3
|
|
|
$
|
12
|
|
|
$
|
(3
|
)
|
|
$
|
—
|
|
|
$
|
12
|
|
Facility-related
|
2
|
|
|
—
|
|
|
(1
|
)
|
|
—
|
|
|
1
|
|
|||||
Asset Write-offs
|
—
|
|
|
2
|
|
|
—
|
|
|
(2
|
)
|
|
—
|
|
|||||
|
$
|
5
|
|
|
$
|
14
|
|
|
$
|
(4
|
)
|
|
$
|
(2
|
)
|
|
$
|
13
|
|
17.
|
Separation Adjustments and Transactions with Former Parent and
Subsidiaries
|
18.
|
Subsequent Event
|
•
|
Hotel Group
—primarily franchises hotels in the upscale, upper midscale, midscale, economy and extended stay segments and provides hotel management services for full-service and select limited-service hotels.
|
•
|
Destination Network
—provides vacation exchange services and products to owners of intervals of vacation ownership interests (“VOIs”) and manages and markets vacation rental properties primarily on behalf of independent owners.
|
•
|
Vacation Ownership
—develops, markets and sells VOIs to individual consumers, provides consumer financing in connection with the sale of VOIs and provides property management services at resorts.
|
|
Three Months Ended September 30,
|
||||||||
|
2016
|
|
2015
|
|
% Change
|
||||
Hotel Group
|
|
|
|
|
|
||||
Number of rooms
(a)
|
689,800
|
|
|
671,900
|
|
|
2.7
|
||
RevPAR
(b)
|
$
|
43.04
|
|
|
$
|
43.34
|
|
|
(0.7)
|
Destination Network
|
|
|
|
|
|
||||
Average number of members (in 000s)
(c)
|
3,868
|
|
|
3,835
|
|
|
0.9
|
||
Exchange revenue per member
(d)
|
$
|
164.39
|
|
|
$
|
163.38
|
|
|
0.6
|
Vacation rental transactions (in 000s)
(e) (f)
|
508
|
|
|
462
|
|
|
10.0
|
||
Average net price per vacation rental
(e) (g)
|
$
|
599.59
|
|
|
$
|
642.00
|
|
|
(6.6)
|
Vacation Ownership
(e)
|
|
|
|
|
|
||||
Gross VOI sales (in 000s)
(h) (i)
|
$
|
564,000
|
|
|
$
|
565,000
|
|
|
(0.2)
|
Tours (in 000s)
(j)
|
230
|
|
|
227
|
|
|
1.3
|
||
Volume Per Guest (“VPG”)
(k)
|
$
|
2,320
|
|
|
$
|
2,354
|
|
|
(1.4)
|
|
(a)
|
Represents the number of rooms at hotel group properties at the end of the period which are under franchise and/or management agreements, or are company owned.
|
(b)
|
Represents revenue per available room and is calculated by multiplying the percentage of available rooms occupied during the period by the average rate charged for renting a hotel room for one day.
|
(c)
|
Represents members in our vacation exchange programs who paid annual membership dues as of the end of the period or who are within the allowed grace period.
|
(d)
|
Represents total annualized revenues generated from fees associated with memberships, exchange transactions, member-related rentals and other servicing for the period divided by the average number of vacation exchange members during the period.
|
(e)
|
Includes the impact from acquisitions from the acquisition dates forward. Therefore, such operating statistics for
2016
are not presented on a comparable basis to the
2015
operating statistics.
|
(f)
|
Represents the number of transactions that are generated during the period in connection with customers booking their vacation rental stays through us. One rental transaction is recorded for each standard one-week rental.
|
(g)
|
Represents the net rental price generated from renting vacation properties to customers and other related rental servicing fees during the period divided by the number of vacation rental transactions during the period.
|
(h)
|
Represents total sales of VOIs, including sales under the Wyndham Asset Affiliation Model (“WAAM”) Fee-for-Service, before the net effect of percentage-of-completion (“POC”) accounting and loan loss provisions. We believe that Gross VOI sales provide an enhanced understanding of the performance of our vacation ownership business because it directly measures the sales volume of this business during a given reporting period.
|
(i)
|
The following table provides a reconciliation of Gross VOI sales to vacation ownership interest sales for the three months ended September 30 (in millions):
|
|
2016
|
|
2015
|
||||
Gross VOI sales
|
$
|
564
|
|
|
$
|
565
|
|
Less: WAAM Fee-for-Service sales
(1)
|
(20
|
)
|
|
(37
|
)
|
||
Gross VOI sales, net of WAAM Fee-for-Service sales
|
544
|
|
|
528
|
|
||
Less: Loan loss provision
|
(104
|
)
|
|
(78
|
)
|
||
Less: Impact of POC accounting
|
—
|
|
|
(2
|
)
|
||
Vacation ownership interest sales
(2)
|
$
|
441
|
|
|
$
|
448
|
|
|
(1)
|
Represents total sales of VOIs through our WAAM Fee-for-Service sales model designed to offer turn-key solutions for developers or banks in possession of newly developed inventory, which we will sell for a commission fee through our extensive sales and marketing channels. WAAM Fee-for-Service commission revenues were
$13 million
and
$23 million
for the three months ended
September 30, 2016
and
2015
, respectively.
|
(2)
|
Amounts may not foot due to rounding.
|
(j)
|
Represents the number of tours taken by guests in our efforts to sell VOIs.
|
(k)
|
VPG is calculated by dividing Gross VOI sales (excluding tele-sales upgrades, which are non-tour upgrade sales) by the number of tours. Tele-sales upgrades were
$31 million
and
$32 million
during the three months ended
September 30, 2016
and
2015
, respectively. We have excluded tele-sales upgrades in the calculation of VPG because tele-sales upgrades are generated by a different marketing channel. We believe that VPG provides an enhanced understanding of the performance of our vacation ownership business because it directly measures the efficiency of this business’s tour selling efforts during a given reporting period.
|
|
Three Months Ended September 30,
|
||||||||||
|
2016
|
|
2015
|
|
Favorable/(Unfavorable)
|
||||||
Net revenues
|
$
|
1,573
|
|
|
$
|
1,564
|
|
|
$
|
9
|
|
Expenses
|
1,237
|
|
|
1,244
|
|
|
7
|
|
|||
Operating income
|
336
|
|
|
320
|
|
|
16
|
|
|||
Other (income)/expense, net
|
(3
|
)
|
|
(3
|
)
|
|
—
|
|
|||
Interest expense
|
34
|
|
|
33
|
|
|
(1
|
)
|
|||
Interest income
|
(2
|
)
|
|
(2
|
)
|
|
—
|
|
|||
Income before income taxes
|
307
|
|
|
292
|
|
|
15
|
|
|||
Provision for income taxes
|
110
|
|
|
102
|
|
|
(8
|
)
|
|||
Net income
|
197
|
|
|
190
|
|
|
7
|
|
|||
Net income attributable to noncontrolling interest
|
(1
|
)
|
|
—
|
|
|
(1
|
)
|
|||
Net income attributable to Wyndham shareholders
|
$
|
196
|
|
|
$
|
190
|
|
|
$
|
6
|
|
•
|
$20 million of higher revenues (excluding intersegment revenues) at our destination network business primarily from growth in vacation rental transactions;
|
•
|
$8 million of higher revenues at our hotel group business primarily from the impact of fees charged for our global franchise conference; and
|
•
|
$7 million of incremental revenue from acquisitions at our destination network business.
|
•
|
$6 million of higher restructuring costs;
|
•
|
$5 million of incremental expenses related to acquisitions at our destination network business; and
|
•
|
a $4 million increase in depreciation and amortization resulting from the impact of property and equipment additions that were placed in service over the last twelve months.
|
|
(a)
|
Includes the elimination of transactions between segments.
|
(b)
|
Includes $7 million of costs associated with the anticipated termination of a management contract and $3 million of restructuring costs incurred as a result of our focus on enhancing organizational efficiency.
|
(c)
|
Includes $4 million of restructuring costs incurred as a result of our focus on enhancing organizational efficiency.
|
(d)
|
Includes $6 million of restructuring costs incurred as a result of our focus on enhancing organizational efficiency and rationalizing existing facilities.
|
(e)
|
Includes (i)
$32 million
of corporate costs, (ii) $1 million of restructuring costs incurred as a result of our focus on enhancing organizational efficiency and (iii) $1 million of a net benefit from the resolution of and adjustment to certain contingent liabilities and assets resulting from our Separation.
|
(f)
|
Includes (i) $14 million of costs associated with the anticipated termination of a management contract, (ii) a $7 million non-cash impairment charge related to the write-down of terminated in-process technology projects resulting from the decision to outsource our reservation system to a third-party provider and (iii) $4 million of restructuring costs incurred as a result of a realignment of brand services and call center operations.
|
(g)
|
Includes $3 million of restructuring costs incurred as a result of a rationalization of our international operations.
|
(h)
|
Includes $1 million of restructuring costs incurred as a result of an organizational realignment of the sales function.
|
(i)
|
Includes
$35 million
of corporate costs.
|
•
|
the absence of a $7 million non-cash impairment charge related to the write-down of terminated in-process technology projects during the third quarter of 2015;
|
•
|
$7 million of lower expense related to the anticipated termination of a management contract which resulted in a charge of $7 million and $14 million during the three months ended September 30, 2016 and 2015, respectively;
|
•
|
$6 million of lower marketing expenses; and
|
•
|
$5 million of cost savings primarily associated with lower employee related costs.
|
•
|
$9 million of higher costs resulting from revenue increases;
|
•
|
$2 million of higher IT costs primarily related to growth initiatives; and
|
•
|
a $2 million non-cash impairment charge related to the write-down of an equity investment.
|
•
|
an $11 million increase in marketing costs principally due to tour growth and our continued focus on new owner generation which yield a higher cost per tour;
|
•
|
$9 million of higher sales and commission expenses resulting from unfavorable commission rates and a $16 million increase in Gross VOI sales, net of WAAM Fee-for-Service, as we continue to shift the mix of our Gross VOIs by reducing our focus on WAAM Fee-for-Service VOI sales;
|
•
|
$5 million of higher restructuring charges; and
|
•
|
$4 million of higher maintenance fees for unsold inventory.
|
|
Nine Months Ended September 30,
|
||||||||||
|
2016
|
|
2015
|
|
Favorable/(Unfavorable)
|
||||||
Net revenues
|
$
|
4,279
|
|
|
$
|
4,224
|
|
|
$
|
55
|
|
Expenses
|
3,476
|
|
|
3,417
|
|
|
(59
|
)
|
|||
Operating income
|
803
|
|
|
807
|
|
|
(4
|
)
|
|||
Other (income)/expense, net
|
(19
|
)
|
|
(11
|
)
|
|
8
|
|
|||
Interest expense
|
102
|
|
|
89
|
|
|
(13
|
)
|
|||
Early extinguishment of debt
|
11
|
|
|
—
|
|
|
(11
|
)
|
|||
Interest income
|
(6
|
)
|
|
(7
|
)
|
|
(1
|
)
|
|||
Income before income taxes
|
715
|
|
|
736
|
|
|
(21
|
)
|
|||
Provision for income taxes
|
267
|
|
|
265
|
|
|
(2
|
)
|
|||
Net income
|
448
|
|
|
471
|
|
|
(23
|
)
|
|||
Net income attributable to noncontrolling interest
|
(1
|
)
|
|
—
|
|
|
(1
|
)
|
|||
Net income attributable to Wyndham shareholders
|
$
|
447
|
|
|
$
|
471
|
|
|
$
|
(24
|
)
|
•
|
$37 million of higher revenues (excluding intersegment revenues) at our destination network business primarily from growth in vacation rental transactions;
|
•
|
$26 million of higher revenues at our vacation ownership business primarily resulting from an increase in property management revenues;
|
•
|
$26 million of incremental revenues (inclusive of $8 million at our hotel group business related to reimbursable fees, which have no impact on EBITDA) resulting from acquisitions at our hotel group and destination network businesses; and
|
•
|
$6 million of higher revenues at our hotel group business primarily due to an increase in ancillary services.
|
•
|
$35 million of higher expenses from operations primarily related to the revenue increases;
|
•
|
a $24 million foreign exchange loss related to the devaluation of the Venezuela exchange rate;
|
•
|
$19 million of incremental expenses related to acquisitions at our hotel group and destination network businesses;
|
•
|
a $14 million increase in depreciation and amortization resulting from the impact of property and equipment additions that were placed in service over the last twelve months; and
|
•
|
$6 million of higher restructuring costs.
|
|
(a)
|
Includes the elimination of transactions between segments.
|
(b)
|
Includes $7 million of costs associated with the anticipated termination of a management contract and $3 million of restructuring costs incurred as a result of our focus on enhancing organizational efficiency.
|
(c)
|
Includes (i) a $24 million foreign currency loss related to the devaluation of the exchange rate of Venezuela, (ii) $4 million of restructuring costs incurred as a result of our focus on enhancing organizational efficiency and (iii) $1 million of acquisition costs.
|
(d)
|
Includes $6 million of restructuring costs incurred as a result of our focus on enhancing organizational efficiency and rationalizing existing facilities.
|
(e)
|
Includes (i)
$97 million
of corporate costs, (ii) $1 million of restructuring costs incurred as a result of our focus on enhancing organizational efficiency and (iii) $1 million of a net benefit from the resolution of and adjustment to certain contingent liabilities and assets resulting from our Separation.
|
(f)
|
Includes (i) $14 million of costs associated with the anticipated termination of a management contract, (ii) a $7 million non-cash impairment charge related to the write-down of terminated in process technology projects resulting from the decision to outsource its reservation system to a third-party provider, (iii) $4 million of restructuring costs incurred as a result of an organizational realignment of brand services and call center operations and (iv) $3 million of costs incurred in connection with the Dolce acquisition.
|
(g)
|
Includes (i) $3 million of restructuring costs incurred as a result of a rationalization of our international operations and (ii) a $1 million reversal of a portion of the restructuring reserve established during the fourth quarter of 2014.
|
(h)
|
Includes $1 million of restructuring costs incurred as a result of an organizational realignment of the sales function.
|
(i)
|
Includes $100 million of corporate costs.
|
•
|
the absence of a $7 million non-cash impairment charge related to the write-down of terminated in-process technology projects during the third quarter of 2015;
|
•
|
$7 million of lower expense related to the anticipated termination of a management contract which resulted in a charge of $7 million and $14 million during the third quarter of 2016 and 2015, respectively;
|
•
|
$7 million of lower marketing expenses;
|
•
|
$9 million of lower expenses primarily related to employee related costs; and
|
•
|
the absence of $3 million of Dolce integration and deal costs incurred during 2015.
|
•
|
$26 million of higher costs resulting from revenue increases;
|
•
|
$4 million of higher IT costs primarily related to growth initiatives;
|
•
|
the absence of a $4 million benefit from a reserve reversal for value-added taxes resulting from a favorable ruling during the first quarter of 2015; and
|
•
|
a $2 million non-cash impairment charge related to the write-down of an equity investment.
|
•
|
a $26 million increase in marketing costs due to tour growth and our continued focus on new owner generation which yield a higher cost per tour;
|
•
|
$15 million of higher sales and commission expenses primarily due to $73 million of higher gross VOI sales, net of WAAM Fee-for-Service; and
|
•
|
$5 million of higher restructuring charges.
|
•
|
a $9 million reduction in the cost of VOIs sold primarily due to the favorable impact on estimated inventory recoveries resulting from an increase in the provision for loan losses partially offset by (i) higher costs related to the increase in VOI sales and (ii) higher average product costs;
|
•
|
$9 million received during 2016 resulting from the settlement of several business interruption claims; and
|
•
|
an $18 million decrease in expenses associated with lower employee related costs and favorable legal settlements.
|
|
September 30,
2016 |
|
December 31,
2015 |
|
Change
|
||||||
Total assets
|
$
|
9,743
|
|
|
$
|
9,591
|
|
|
$
|
152
|
|
Total liabilities
|
8,946
|
|
|
8,638
|
|
|
308
|
|
|||
Total equity
|
797
|
|
|
953
|
|
|
(156
|
)
|
•
|
a $161 million increase in cash and cash equivalents primarily due to seasonality in our vacation rentals businesses and growth within our international operations;
|
•
|
a $55 million increase in inventory resulting from (i) current year spend on vacation ownership development projects and (ii) the transfer of property and equipment to inventory, partially offset by VOI sales; and
|
•
|
a $50 million increase in vacation ownership contract receivables primarily due to net loan originations exceeding principal collections and loan loss provision.
|
•
|
a $44 million decrease in trade receivables principally due to collections on advanced bookings resulting from seasonality at our vacation rentals business; and
|
•
|
a $41 million reduction in net property and equipment resulting from (i) $160 million of current year depreciation and (ii) the transfer of property and equipment to VOI inventory, partially offset by $136 million of property and equipment additions.
|
|
Nine Months Ended September 30,
|
||||||||||
|
2016
|
|
2015
|
|
Change
|
||||||
Cash provided by/(used in)
|
|
|
|
|
|
||||||
Operating activities
|
$
|
786
|
|
|
$
|
817
|
|
|
$
|
(31
|
)
|
Investing activities
|
(172
|
)
|
|
(244
|
)
|
|
72
|
|
|||
Financing activities
|
(442
|
)
|
|
(477
|
)
|
|
35
|
|
|||
Effects of changes in exchange rates on cash and cash equivalents
|
(11
|
)
|
|
(20
|
)
|
|
9
|
|
|||
Net change in cash and cash equivalents
|
$
|
161
|
|
|
$
|
76
|
|
|
$
|
85
|
|
|
10/1/16 - 9/30/17
|
|
10/1/17 - 9/30/18
|
|
10/1/18 - 9/30/19
|
|
10/1/19 - 9/30/20
|
|
10/1/20 - 9/30/21
|
|
Thereafter
|
|
Total
|
||||||||||||||
Securitized debt
(a)
|
$
|
200
|
|
|
$
|
193
|
|
|
$
|
430
|
|
|
$
|
202
|
|
|
$
|
215
|
|
|
$
|
858
|
|
|
$
|
2,098
|
|
Long-term debt
(b)
|
333
|
|
|
478
|
|
|
26
|
|
|
497
|
|
|
542
|
|
|
1,475
|
|
|
3,351
|
|
|||||||
Interest on debt
(c)
|
176
|
|
|
162
|
|
|
151
|
|
|
139
|
|
|
103
|
|
|
133
|
|
|
864
|
|
|||||||
Operating leases
|
86
|
|
|
70
|
|
|
56
|
|
|
42
|
|
|
33
|
|
|
173
|
|
|
460
|
|
|||||||
Purchase commitments
(d)
|
201
|
|
|
121
|
|
|
58
|
|
|
25
|
|
|
27
|
|
|
48
|
|
|
480
|
|
|||||||
Inventory sold subject to conditional repurchase
(e)
|
106
|
|
|
105
|
|
|
69
|
|
|
38
|
|
|
56
|
|
|
30
|
|
|
404
|
|
|||||||
Separation liabilities
(f)
|
6
|
|
|
28
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
34
|
|
|||||||
Total
(g) (h)
|
$
|
1,108
|
|
|
$
|
1,157
|
|
|
$
|
790
|
|
|
$
|
943
|
|
|
$
|
976
|
|
|
$
|
2,717
|
|
|
$
|
7,691
|
|
|
(a)
|
Represents debt that is securitized through bankruptcy-remote special purpose entities the creditors to which have no recourse to us for principal and interest.
|
(b)
|
Includes $300 million of senior unsecured notes due during March 2017 which we intend to refinance on a long-term basis and have the ability to do so with available capacity under our revolving credit facility.
|
(c)
|
Includes interest on both securitized and long-term debt; estimated using the stated interest rates on our long-term debt and the swapped interest rates on our securitized debt.
|
(d)
|
Includes (i) $164 million for information technology activities, (ii) $101 million for marketing related activities and (iii) $131 million relating to the development of vacation ownership properties, of which $44 million is included within total liabilities on the Consolidated Balance Sheet.
|
(e)
|
Represents obligations to repurchase completed vacation ownership properties from third-party developers (See Note 6 – Inventory for further detail) of which $131 million are included within total liabilities on the Consolidated Balance Sheet.
|
(f)
|
Represents liabilities which we assumed and are responsible for pursuant to our Separation (See Note 17 – Separation Adjustments and Transactions with Former Parent and Subsidiaries for further details).
|
(g)
|
Excludes a $38 million liability for unrecognized tax benefits associated with the guidance for uncertainty in income taxes since it is not reasonably estimable to determine the periods in which such liability would be settled with the respective tax authorities.
|
(h)
|
Excludes other guarantees at our hotel group business as it is not reasonably estimable to determine the periods in which such commitments would be settled (See Note 12– Commitments and Contingencies for further details).
|
(a)
|
Disclosure Controls and Procedures.
As of the end of the period covered by this report, we carried out an evaluation, under the supervision and with the participation of our management, including our principal executive and principal financial officers, of the effectiveness of the design and operation of our disclosure controls and procedures (as such term is defined in Rule 13(a)-15(e) of the Securities Exchange Act of 1934 (the “Exchange Act”)). Based on such evaluation, our principal executive and principal financial officers concluded that our disclosure controls and procedures were effective and operating to provide reasonable assurance that information required to be disclosed by us in the reports we file or submit under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the rules and forms of the SEC, and to provide reasonable assurance that such information is accumulated and communicated to our management, including our principal executive and principal financial officers, as appropriate, to allow timely decisions regarding required disclosure.
|
(b)
|
Internal Control Over Financial Reporting.
There have been no changes in our internal control over financial reporting (as such term is defined in Rule 13a-15(f) under the Exchange Act) during the period to which this report relates that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting. As of
September 30, 2016
, we utilized the criteria established in
Internal Control-Integrated Framework (2013)
issued by the Committee of Sponsoring Organizations (COSO) of the Treadway Commission.
|
(c)
|
Below is a summary of our Wyndham common stock repurchases by month for the quarter ended
September 30, 2016
:
|
ISSUER PURCHASES OF EQUITY SECURITIES
|
||||||||||
Period
|
Total Number of Shares Purchased
|
|
Average Price Paid per Share
|
|
Total Number of Shares Purchased as Part of Publicly Announced Plan
|
|
Approximate Dollar Value of Shares that May Yet Be Purchased Under Plan
|
|
||
July 1-31, 2016
|
773,400
|
|
$
|
73.11
|
|
773,400
|
|
$
|
984,413,214
|
|
August 1-31, 2016
|
690,400
|
|
$
|
70.27
|
|
690,400
|
|
$
|
935,899,376
|
|
September 1-30, 2016
|
657,112
|
|
$
|
68.27
|
|
657,112
|
|
$
|
891,035,509
|
|
Total
|
2,120,912
|
|
$
|
70.69
|
|
2,120,912
|
|
$
|
891,035,509
|
|
|
|
WYNDHAM WORLDWIDE CORPORATION
|
|
|
|
Date: October 26, 2016
|
By:
|
/s/ Thomas G. Conforti
|
|
|
Thomas G. Conforti
|
|
|
Chief Financial Officer
|
|
|
|
Date: October 26, 2016
|
By:
|
/s/ Nicola Rossi
|
|
|
Nicola Rossi
|
|
|
Chief Accounting Officer
|
Exhibit No.
|
Description
|
10.1
|
Seventh Amendment, dated as of August 23, 2016, to the Amended and Restated Indenture and Servicing Agreement, dated as of October 1, 2010, by and among Sierra Timeshare Conduit Receivables Funding II, LLC, as Issuer, Wyndham Consumer Finance, Inc., as Servicer, Wells Fargo Bank, National Association, as Trustee and U.S. Bank National Association, as Collateral Agent
|
12*
|
Computation of Ratio of Earnings to Fixed Charges
|
15*
|
Letter re: Unaudited Interim Financial Information
|
31.1*
|
Certification of Chairman and Chief Executive Officer Pursuant to Rule 13a-14(a) Under the Securities Exchange Act of 1934
|
31.2*
|
Certification of Chief Financial Officer Pursuant to Rule 13a-14(a) Under the Securities Exchange Act of 1934
|
32**
|
Certification of Chairman and Chief Executive Officer and Chief Financial Officer pursuant to 18 U.S.C. Section 1350
|
101.INS*
|
XBRL Instance Document
|
101.SCH*
|
XBRL Taxonomy Extension Schema Document
|
101.CAL*
|
XBRL Taxonomy Extension Calculation Linkbase Document
|
101.DEF*
|
XBRL Taxonomy Extension Definition Linkbase Document
|
101.LAB*
|
XBRL Taxonomy Extension Label Linkbase Document
|
101.PRE*
|
XBRL Taxonomy Extension Presentation Linkbase Document
|
|
*
|
Filed with this report
|
By:
/s/ Joseph M. Hollingshead
|
Name: Joseph M. Hollingshead Title: President |
By:
/s/ Tamara Schultz-Fugh
|
Name: Tamara Schultz-Fugh Title: Vice President |
|
Nine Months Ended September 30,
|
||||||
|
2016
|
|
2015
|
||||
Earnings available to cover fixed charges:
|
|
|
|
||||
Income before income taxes
|
$
|
715
|
|
|
$
|
736
|
|
Less: Income from equity investees
|
1
|
|
|
1
|
|
||
|
714
|
|
|
735
|
|
||
Plus: Fixed charges
|
177
|
|
|
166
|
|
||
Amortization of capitalized interest
|
4
|
|
|
3
|
|
||
Less: Capitalized interest
|
4
|
|
|
5
|
|
||
Earnings available to cover fixed charges
|
$
|
891
|
|
|
$
|
899
|
|
Fixed charges
(*)
:
|
|
|
|
||||
Interest
|
$
|
157
|
|
|
$
|
144
|
|
Capitalized interest
|
4
|
|
|
5
|
|
||
Interest portion of rental expense
|
16
|
|
|
17
|
|
||
Total fixed charges
|
$
|
177
|
|
|
$
|
166
|
|
Ratio of earnings to fixed charges
|
5.03x
|
|
|
5.42x
|
|
|
(*)
|
Consists of interest expense on all indebtedness (including costs related to the amortization of deferred financing costs), capitalized interest and the portion of operating lease rental expense that is representative of the interest factor.
|
1.
|
I have reviewed this quarterly report on Form 10-Q of Wyndham Worldwide Corporation;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c)
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
d)
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
5.
|
The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s Board of Directors (or persons performing the equivalent functions):
|
a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
Date: October 26, 2016
|
|
|
/S/ STEPHEN P. HOLMES
|
|
CHAIRMAN AND CHIEF EXECUTIVE OFFICER
|
1.
|
I have reviewed this quarterly report on Form 10-Q of Wyndham Worldwide Corporation;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c)
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
d)
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
5.
|
The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s Board of Directors (or persons performing the equivalent functions):
|
a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
Date: October 26, 2016
|
|
|
/S/ THOMAS G. CONFORTI
|
|
CHIEF FINANCIAL OFFICER
|
(1.)
|
The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
|
(2.)
|
The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
|
/S/ STEPHEN P. HOLMES
|
STEPHEN P. HOLMES
|
CHAIRMAN AND CHIEF EXECUTIVE OFFICER
|
OCTOBER 26, 2016
|
/S/ THOMAS G. CONFORTI
|
THOMAS G. CONFORTI
|
CHIEF FINANCIAL OFFICER
|
OCTOBER 26, 2016
|