2023 Q1 Form 10-K Financial Statement

#000152435823000009 Filed on February 27, 2023

View on sec.gov

Income Statement

Concept 2023 Q1 2022 Q4 2022
Revenue $1.169B $1.188B $4.656B
YoY Change 11.12% 8.0% 19.69%
Cost Of Revenue $556.0M $569.0M $2.175B
YoY Change 6.11% 5.96% 9.46%
Gross Profit $613.0M $619.0M $2.481B
YoY Change 16.1% 9.95% 30.37%
Gross Profit Margin 52.44% 52.1% 53.29%
Selling, General & Admin $278.0M $384.0M $1.056B
YoY Change 14.4% 5.49% 25.12%
% of Gross Profit 45.35% 62.04% 42.56%
Research & Development
YoY Change
% of Gross Profit
Depreciation & Amortization $32.00M $34.00M $132.0M
YoY Change -3.03% 0.0% -9.59%
% of Gross Profit 5.22% 5.49% 5.32%
Operating Expenses $278.0M $418.0M $1.056B
YoY Change 14.4% 5.03% 25.12%
Operating Profit $335.0M $201.0M $1.425B
YoY Change 17.54% 21.82% 34.56%
Interest Expense -$34.00M -$27.00M -$118.0M
YoY Change 25.93% -25.0% -28.05%
% of Operating Profit -10.15% -13.43% -8.28%
Other Income/Expense, Net $21.00M $2.000M $1.000M
YoY Change 425.0% -108.33% -50.0%
Pretax Income $128.0M $145.0M $582.0M
YoY Change 42.22% 107.14% 358.27%
Income Tax $41.00M $57.00M $191.0M
% Of Pretax Income 32.03% 39.31% 32.82%
Net Earnings $87.00M $88.00M $391.0M
YoY Change 50.0% 44.26% 697.96%
Net Earnings / Revenue 7.44% 7.41% 8.4%
Basic Earnings Per Share $2.32 $9.69
Diluted Earnings Per Share $2.06 $2.04 $8.77
COMMON SHARES
Basic Shares Outstanding 37.24M shares 38.32M shares 40.40M shares
Diluted Shares Outstanding 44.40M shares 45.20M shares

Balance Sheet

Concept 2023 Q1 2022 Q4 2022
SHORT-TERM ASSETS
Cash & Short-Term Investments $306.0M $524.0M $524.0M
YoY Change -13.56% 53.22% 53.22%
Cash & Equivalents $306.0M $524.0M $524.0M
Short-Term Investments
Other Short-Term Assets
YoY Change
Inventory $672.0M $660.0M $660.0M
Prepaid Expenses
Receivables $289.0M $292.0M $292.0M
Other Receivables $0.00 $0.00 $0.00
Total Short-Term Assets $1.267B $1.476B $1.476B
YoY Change 0.0% 11.31% 11.31%
LONG-TERM ASSETS
Property, Plant & Equipment $1.215B $1.139B $1.139B
YoY Change 4.56% -7.55% -7.55%
Goodwill $3.117B $3.117B
YoY Change -0.8% -1.05%
Intangibles $898.0M $911.0M
YoY Change -8.18% -8.26%
Long-Term Investments
YoY Change
Other Assets $268.0M $330.0M $330.0M
YoY Change -9.46% -28.42% -28.42%
Total Long-Term Assets $8.335B $8.163B $8.163B
YoY Change 1.2% -1.5% -1.5%
TOTAL ASSETS
Total Short-Term Assets $1.267B $1.476B $1.476B
Total Long-Term Assets $8.335B $8.163B $8.163B
Total Assets $9.602B $9.639B $9.639B
YoY Change 1.04% 0.27% 0.27%
SHORT-TERM LIABILITIES
YoY Change
Accounts Payable $222.0M $356.0M $356.0M
YoY Change 4.72% 34.34% 34.34%
Accrued Expenses $540.0M $620.0M $620.0M
YoY Change -3.74% 13.55% 13.55%
Deferred Revenue
YoY Change
Short-Term Debt $0.00 $0.00 $0.00
YoY Change
Long-Term Debt Due
YoY Change
Total Short-Term Liabilities $762.0M $1.134B $1.134B
YoY Change -21.2% 16.79% 16.79%
LONG-TERM LIABILITIES
Long-Term Debt $5.065B $5.026B $5.026B
YoY Change 11.81% 12.01% 12.01%
Other Long-Term Liabilities $956.0M $650.0M $650.0M
YoY Change 12.6% -20.63% -20.63%
Total Long-Term Liabilities $6.021B $5.676B $5.676B
YoY Change 11.94% 6.97% 6.97%
TOTAL LIABILITIES
Total Short-Term Liabilities $762.0M $1.134B $1.134B
Total Long-Term Liabilities $6.021B $5.676B $5.676B
Total Liabilities $7.122B $7.141B $7.143B
YoY Change 6.63% 7.76% 7.62%
SHAREHOLDERS EQUITY
Retained Earnings $654.0M $593.0M
YoY Change 93.49% 115.64%
Common Stock $3.938B $3.942B
YoY Change -0.2% -3.22%
Preferred Stock
YoY Change
Treasury Stock (at cost) $2.054B
YoY Change 51.47%
Treasury Stock Shares 38.26M shares
Shareholders Equity $2.478B $2.496B $2.496B
YoY Change
Total Liabilities & Shareholders Equity $9.602B $9.639B $9.639B
YoY Change 1.04% 0.27% 0.27%

Cashflow Statement

Concept 2023 Q1 2022 Q4 2022
OPERATING ACTIVITIES
Net Income $87.00M $88.00M $391.0M
YoY Change 50.0% 44.26% 697.96%
Depreciation, Depletion And Amortization $32.00M $34.00M $132.0M
YoY Change -3.03% 0.0% -9.59%
Cash From Operating Activities -$50.00M $142.0M $522.0M
YoY Change -138.76% 255.0% 52.19%
INVESTING ACTIVITIES
Capital Expenditures $37.00M $29.00M $65.00M
YoY Change 311.11% -203.57% 38.3%
Acquisitions
YoY Change
Other Investing Activities $0.00 -$4.000M -$2.000M
YoY Change -100.0% -300.0% 0.0%
Cash From Investing Activities -$37.00M -$33.00M $16.00M
YoY Change 270.0% 26.92% -107.51%
FINANCING ACTIVITIES
Cash Dividend Paid $54.00M $99.00M
YoY Change 10.2% 330.43%
Common Stock Issuance & Retirement, Net $701.0M
YoY Change 798.72%
Debt Paid & Issued, Net
YoY Change
Cash From Financing Activities -$194.0M 199.0M -$486.0M
YoY Change -28.68% -316.3% 53.31%
NET CHANGE
Cash From Operating Activities -$50.00M 142.0M $522.0M
Cash From Investing Activities -$37.00M -33.00M $16.00M
Cash From Financing Activities -$194.0M 199.0M -$486.0M
Net Change In Cash -$280.0M 308.0M $51.00M
YoY Change 83.01% -494.87% -126.98%
FREE CASH FLOW
Cash From Operating Activities -$50.00M $142.0M $522.0M
Capital Expenditures $37.00M $29.00M $65.00M
Free Cash Flow -$87.00M $113.0M $457.0M
YoY Change -172.5% 66.18% 54.39%

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CY2021 us-gaap Adjustments To Additional Paid In Capital Equity Component Of Convertible Debt
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BASIS OF PRESENTATION <div style="margin-top:6pt"><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-weight:400;line-height:120%">The Consolidated Financial Statements present the results of operations, financial position and cash flows of Marriott Vacations Worldwide Corporation (referred to in this report as (i) “we,” “us,” “Marriott Vacations Worldwide,” “MVW,” or “the Company,” which includes our consolidated subsidiaries except where the context of the reference is to a single corporate entity, or (ii) “MVWC,” which shall refer only to Marriott Vacations Worldwide Corporation, without its consolidated subsidiaries). In order to make this report easier to read, we refer throughout to (i) our Consolidated Financial Statements as our “Financial Statements,” (ii) our Consolidated Statements of Income as our “Income Statements,” (iii) our Consolidated Balance Sheets as our “Balance Sheets,” and (iv) our Consolidated Statements of Cash Flows as our “Cash Flows.” In addition, references throughout to numbered “Footnotes” refer to the numbered Notes in these Notes to Consolidated Financial Statements, unless otherwise noted. We also refer to Marriott International, Inc. as “Marriott International” and Marriott International’s Marriott Bonvoy customer loyalty program as “Marriott Bonvoy.” We use certain other terms that are defined within these Financial Statements.</span></div><div style="margin-top:6pt"><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-weight:400;line-height:120%">The Financial Statements presented herein and discussed below include 100% of the assets, liabilities, revenues, expenses, and cash flows of Marriott Vacations Worldwide, all entities in which Marriott Vacations Worldwide has a controlling voting interest (“subsidiaries”), and those variable interest entities (“VIEs”) for which Marriott Vacations Worldwide is the primary beneficiary in accordance with consolidation accounting guidance. References in these Financial Statements to net income or loss attributable to common shareholders and MVW shareholders’ equity do not include noncontrolling interests, which represent the outside ownership of our consolidated non-wholly owned entities and are reported separately. Intercompany accounts and transactions between consolidated entities have been eliminated in consolidation. </span></div><div style="margin-top:6pt"><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-weight:400;line-height:120%">Pursuant to a change in control of certain consolidated owners’ associations during 2022, we no longer consolidate these owners’ associations. We recorded non-cash losses of $3 million in Gains (losses) and other income (expense), net on our Income Statement for the year ended December 31, 2022, and deconsolidated $110 million of assets, inclusive of $48 million of restricted cash, and $99 million of liabilities, resulting in a decrease in Noncontrolling interests of $8 million during 2022. We continue to act as manager for these owners’ associations pursuant to existing management contracts and we retain membership interests in these owners’ associations via our ownership of vacation ownership interests (“VOIs”).</span></div><div style="margin-top:6pt"><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-weight:400;line-height:120%">These Financial Statements reflect our financial position, results of operations, and cash flows as prepared in conformity with United States Generally Accepted Accounting Principles (“GAAP”). The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect amounts reported in the financial statements and accompanying notes. Such estimates include, but are not limited to, revenue recognition, allocations of the purchase price paid in business combinations, cost of vacation ownership products, inventory valuation, goodwill and intangibles valuation, accounting for acquired vacation ownership notes receivable, vacation ownership notes receivable reserves, income taxes, and loss contingencies. The uncertainties created by the COVID-19 pandemic (as defined below) including the uncertainty of the success of ongoing efforts to mitigate the effects of the COVID-19 pandemic and inflationary pressures in the general macroeconomic environment, have made it more challenging to make these estimates. Actual results could differ from our estimates, and such differences may be material.</span></div><div style="margin-top:6pt"><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-weight:400;line-height:120%">We have reclassified certain prior year amounts to conform with our current year presentation.</span></div><div style="margin-top:6pt"><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-style:italic;font-weight:700;line-height:120%">Acquisition of Welk</span></div><div style="margin-top:6pt"><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-weight:400;line-height:120%">On April 1, 2021 (the “Welk Acquisition Date”), we completed the acquisition of Welk Hospitality Group, Inc. (“Welk”) through a series of transactions (the “Welk Acquisition”), after which Welk became our indirect wholly-owned subsidiary. The Financial Statements in this report for fiscal year 2021 include Welk’s results of operations for the last three quarters of 2021, and reflect the financial position of our combined company at December 31, 2021. We refer to the business and brands that we acquired in the Welk Acquisition as “Legacy-Welk.” See Footnote 3 “Acquisitions and Dispositions” for more information on the Welk Acquisition.</span></div><div style="margin-top:6pt"><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-style:italic;font-weight:700;line-height:120%">Acquisition of ILG and Disposition of VRI America</span></div><div style="margin-top:6pt"><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-weight:400;line-height:120%">On September 1, 2018 we completed the acquisition of ILG, LLC, formerly known as ILG, Inc. (“ILG”), through a series of transactions (the “ILG Acquisition”), after which ILG became our indirect wholly-owned subsidiary. We refer to our business associated with brands that existed prior to the ILG Acquisition as “Legacy-MVW” and to ILG’s business and brands that we acquired as “Legacy-ILG.” The businesses acquired from ILG that we currently operate as part of our Vacation Ownership business include Vistana Signature Experiences, which includes vacation ownership products branded as Sheraton or Westin, </span></div><div style="margin-top:6pt"><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-weight:400;line-height:120%">and Hyatt Vacation Ownership. The businesses acquired from ILG that we currently operate as part of our Exchange &amp; Third-Party Management business include Interval International and Aqua-Aston Hospitality. As part of the ILG Acquisition, we also acquired the Vacation Resorts International (“VRI”) and Trading Places International (“TPI”) businesses (together, the “VRI Americas” business). Our Financial Statements reflect the disposition of the VRI Americas business on April 29, 2022. See Footnote 3 “Acquisitions and Dispositions” for more information on the disposition of VRI Americas.</span></div><div style="margin-top:6pt"><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-style:italic;font-weight:700;line-height:120%">COVID-19 Pandemic</span></div>In early 2020, the World Health Organization declared the coronavirus outbreak a global pandemic (“COVID-19” or “the COVID-19 pandemic,”). The COVID-19 pandemic caused significant disruptions in international and U.S. economies and markets, and also had an unprecedented impact on the travel and hospitality industries, as well as our business and results of operations. Although COVID-19’s negative impact on our business significantly decreased during 2022, the ongoing impact is uncertain and our financial results may not be indicative of long-term future performance.
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CY2020 vac Real Estate Inventory True Ups
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CY2020 us-gaap Revenues
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CY2021Q4 us-gaap Notes Receivable Net
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CY2021Q4 vac Contractwith Customer Receivable
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CY2021Q4 vac Contract With Customer Liability Advance Deposits
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CY2022Q4 vac Contract With Customer Liability Deferred Revenue
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CY2022Q4 us-gaap Revenue Remaining Performance Obligation Expected Timing Of Satisfaction Period1
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CY2021Q4 us-gaap Income Tax Receivable
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CY2022Q4 vac Accounts Receivable Including Variable Interest Entities After Allowancefor Credit Loss
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CY2021Q4 vac Accounts Receivable Including Variable Interest Entities After Allowancefor Credit Loss
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CY2022 us-gaap Income Loss From Continuing Operations Before Income Taxes Domestic
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CY2020 us-gaap Income Loss From Continuing Operations Before Income Taxes Domestic
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CY2020 us-gaap Income Loss From Continuing Operations Before Income Taxes Extraordinary Items Noncontrolling Interest
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CY2021 us-gaap Income Tax Expense Benefit
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CY2022 us-gaap Effective Income Tax Rate Reconciliation At Federal Statutory Income Tax Rate
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CY2021 us-gaap Effective Income Tax Rate Reconciliation At Federal Statutory Income Tax Rate
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CY2020 us-gaap Effective Income Tax Rate Reconciliation At Federal Statutory Income Tax Rate
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CY2022 us-gaap Effective Income Tax Rate Reconciliation State And Local Income Taxes
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CY2021 us-gaap Effective Income Tax Rate Reconciliation State And Local Income Taxes
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CY2020 us-gaap Effective Income Tax Rate Reconciliation State And Local Income Taxes
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CY2022 vac Effective Income Tax Rate Reconciliation Share Based Compensation Expense Tax Benefit Percent
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CY2021 vac Effective Income Tax Rate Reconciliation Share Based Compensation Expense Tax Benefit Percent
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CY2020 vac Effective Income Tax Rate Reconciliation Share Based Compensation Expense Tax Benefit Percent
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0.002
CY2022 vac Effective Income Tax Rate Reconciliation Permanent Difference
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CY2021 vac Effective Income Tax Rate Reconciliation Permanent Difference
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-0.055
CY2020 vac Effective Income Tax Rate Reconciliation Permanent Difference
EffectiveIncomeTaxRateReconciliationPermanentDifference
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CY2022 vac Effective Income Tax Rate Reconciliation Impact Related To Coronavirus Aid Relief And Economic Security Act Of2020
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0
CY2021 vac Effective Income Tax Rate Reconciliation Impact Related To Coronavirus Aid Relief And Economic Security Act Of2020
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0
CY2020 vac Effective Income Tax Rate Reconciliation Impact Related To Coronavirus Aid Relief And Economic Security Act Of2020
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0.060
CY2022 us-gaap Effective Income Tax Rate Reconciliation Change In Enacted Tax Rate
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CY2020 us-gaap Effective Income Tax Rate Reconciliation Change In Enacted Tax Rate
EffectiveIncomeTaxRateReconciliationChangeInEnactedTaxRate
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CY2022 us-gaap Effective Income Tax Rate Reconciliation Foreign Income Tax Rate Differential
EffectiveIncomeTaxRateReconciliationForeignIncomeTaxRateDifferential
0.045
CY2021 us-gaap Effective Income Tax Rate Reconciliation Foreign Income Tax Rate Differential
EffectiveIncomeTaxRateReconciliationForeignIncomeTaxRateDifferential
0.129
CY2020 us-gaap Effective Income Tax Rate Reconciliation Foreign Income Tax Rate Differential
EffectiveIncomeTaxRateReconciliationForeignIncomeTaxRateDifferential
0.042
CY2022 us-gaap Effective Income Tax Rate Reconciliation Tax Credits
EffectiveIncomeTaxRateReconciliationTaxCredits
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CY2021 us-gaap Effective Income Tax Rate Reconciliation Tax Credits
EffectiveIncomeTaxRateReconciliationTaxCredits
0.009
CY2020 us-gaap Effective Income Tax Rate Reconciliation Tax Credits
EffectiveIncomeTaxRateReconciliationTaxCredits
-0.002
CY2022 vac Effective Income Tax Rate Reconciliation Unrecognized Tax Benefits Percent
EffectiveIncomeTaxRateReconciliationUnrecognizedTaxBenefitsPercent
-0.027
CY2021 vac Effective Income Tax Rate Reconciliation Unrecognized Tax Benefits Percent
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