Travel + Leisure Co.

Greetings, and welcome to the Travel and Leisure First Quarter 2024 Earnings Conference Call. At this time, all participants are in a listen-only mode. A brief question and answer session will follow the formal presentation. If anyone should require operator assistance during the conference, please press star zero on your telephone keypad. As a reminder, this conference is being recorded. It is now my pleasure to introduce your host, Jill Greer, Vice President of Investor Relations. Thank you. You may begin.

Thanks, Maria. Good morning to everyone, and thank you for dialing in to our first quarter call. Joining us this morning are Michael Brown, our President and Chief Executive Officer, and Mike Hugg, our Chief Financial Officer. Michael will provide an overview of our financial results and our longer-term growth strategy, and Mike will then provide greater detail on the quarter, our balance sheet, and outlook for the rest of the year. Following our prepared remarks, we'll open the call up for questions. Before we begin, we'd like to remind you that our discussions today will include forward-looking statements Actual results could differ materially from those indicated in the forward-looking statements, and the forward-looking statements made today are effective only as of today. We undertake no obligation to publicly update or revise these statements. The factors that could cause actual results to differ are discussed in our SEC filing and in our earnings press release. You can find a reconciliation of the non-GAAP financial measures discussed in today's call in the earnings press release available on our Investor Relations website. Finally, all comments today are comparisons to the same period of the prior year unless specifically stated. With that, I'm pleased to turn the call over to Michael Brown.

Good morning, everyone. Welcome to our first quarter call, and welcome, Jill, to the Travel and Leisure team. During our last call, we highlighted two themes, robust demand for vacation ownership and our team's focus on execution. Our Q1 results show these trends continuing with 4% revenue growth $191 million in adjusted EBITDA and adjusted earnings per share of 97 cents. I want to extend my personal thanks to the entire T&L team for their excellent performance, which has gotten our year off to a great start. Tours increased 15% year-over-year, with new owner tours up 28%. The sizable tour increase is important because it reflects strong interest in our product as well as the benefit of investments we've made in our marketing operations, including the addition of new locations. Q1 VPG ended at $3,035, above the high end of our guidance range, which strengthened as the quarter progressed. We are also pleased with the VPG thus far in April. The combination of higher new owner tour growth and strong VPGs helps answer the central question I'm asked by media and investors most often, how is the consumer? From our view, demand for leisure travel remains robust. As we look ahead, we have a 7% increase in owner room nights for the remainder of the year compared to the same period last year. Both booking windows and arrivals by car have normalized, more signs that the consumer is confident to book future travel, and the trends we are seeing in our business are consistent with broader industry sentiment. A recent Future Partners report showed that financial optimism among travelers has improved and excitement to travel remains elevated. With a strong industry macro backdrop, good momentum at Travel Leisure specifically, and the visibility that we have for this year's summer travel season, we have increased confidence in our near-term outlook. As we think about longer-term growth in the vacation ownership business, we're focused on expanding our product portfolio and growing the business both organically and through strategic acquisitions and partnerships. On the product side, the Accor Vacation Club transaction closed in early March, adding a premium product in the international market to our portfolio. With this acquisition, we now have more than 270 resorts worldwide, giving us more opportunities to put the world on vacation every day. Our team is already focused on its ramping of sales, as well as the transition of the overall business. I'd specifically like to thank the leadership team at Accor for working with us on making this a very smooth transition and their thoughtfulness on how to grow going forward. We are also making progress toward the start of sales next year for our initial Sports Illustrated brand-new resort. This will be the first of a network of sports-themed resort and lifestyle complexes, which we expect will include both university locations and leading leisure destinations. With multiple brands and a broad geographic footprint, our network of resorts provides a natural hedge to individual market fluctuations. In fact, as a result of our highly diversified resort system, we only have one market that produces more than 10% of VOI sales volume. In terms of growth, we are continuing to innovate and invest in acquiring new owners. Our Blue Thread partnership with Wyndham delivered great results with sales up nearly 10% year over year. As a reminder, the Blue Thread channel typically generates 10 to 20% of our new owner tours with a VPG more than 20% higher than other new owner tours. Our new owner transactions were 37% of the total up four points sequentially and six points year over year, putting us well within our long-term targeted new owner mix. This is an important pipeline of future revenue as historically we have seen that a new owner will spend an average of 2.6 times their initial purchase in future years after vacationing with us. This consumer behavior is consistent with ARDA's February sentiment survey, which found that nearly half of all timeshare owners plan to upgrade their current ownership in the next two years. So overall, we're in a really good position to grow the vacation ownership business. On the travel and membership side, the results came in within our guidance range, which shows our focus on aligning cost with revenue generation is paying dividends as we drive the business for its high margins and free cash flow generation. To summarize, consumer demand for leisure travel remains robust, and we are delivering against plans to efficiently grow our business. We have a great team in place with a record of solid execution, and we are on track to meet our 2024 commitments to grow revenue in EBITDA and deliver strong returns to our shareholders. With that, I would now like to hand the call over to Mike Hugg.