Travel + Leisure (TNL) 25 Oct 232023 Q3 Earnings call transcript

Hello, and welcome to the Travel & Leisure Q3 2023 Earnings Call and Webcast. [Operator Instructions] As a reminder, this conference is being recorded.

It's now my pleasure to turn the call over to Christopher Agnew Investor Relations. Please go ahead, sir.

morning. good and Kevin, Thanks,

a today. and no earnings Chief in provide for in results. of of discussed as press quarter, the accompanying these filings Before we discussions call and Chief publicly rest and will could greater Executive revise travelandleisureco.com/investors. This earnings you our an morning, you can forward-looking to obligation materially are today's at our made our update effective Hug, then we'd press the the will outlook website non-GAAP differ include find like of statements quarter in the measures today in results the those earnings year. call Michael remind detail our forward-looking in only Officer reconciliation factors forward-looking on Mike discussed results and statements Brown, from today the third and financial that Financial sheet to our President And to that indicated or will begin, the statements. on differ our our release available of statements. The could release We the undertake balance cause provide actual SEC our Actual overview Officer,

up prepared remarks, the we Brown. call Following turn our that, will the pleased Michael questions. With to open I'm for call to over

a of adjusted million, on over share us and XXXX. earnings Thanks, per $X.XX, $XXX we increase prior joining adjusted thank our XX% third of quarter Chris, EBITDA for improvement earnings you and call. This morning, over QX diluted reported a year X% the

and prior compared flat XX% prior was the margin EBITDA adjusted year. quarter quarter Third to

business. volume of gross guest were and the VOI the key vacation end against Our team per results delivered performance top Sales at sales ownership expectations. indicators, solid particularly

XX% respectively, As flow owner XX% total tour year-over-year. in and increased well, new

of in In for the owner increased grow over XX.X%, of loss The came expectations XXX re-infirming base, our quality. mix provision sales. commitment our improvements loan to nearly transaction with points at to ahead just owner the new basis in XX% keeping credit

of returned through shareholders $XX on we by which of Regarding our quarter puts million full capital dividends the third reduce the in the quarter, for recent to start we the XXXX we year. From reduced combination shares to outstanding track count allocation, XX% by million spin, of share and shares end reduced share count or shares Since us the repurchases, of until our a XX%. most XX% by our have have XX outstanding. share

consumer. indicators the you update performance me gauge on monitor Let of to health we our key the

sales finance performance resort of and volume consumer per the portfolio. Forward bookings, our guest

nights Regarding Total X% continued XXXX, arrivals of booking is forward on X% a pace. ahead quarter owner of bookings, QX owner fourth and length strong of are XXXX. stay ahead the above the are reflecting quarter book fourth

of at X we longer one believe respondents surveys, behind quarter in resorts of anywhere the stay. note, from work our our is remote length of factors post-pay staying while Of reinforcing nearly were trend that the

VPG. to Turning

us we our improving did VPG to but quarter, range long-term higher the owner XXXX, long-term sales. XX% This of be this over period new the the the to owner remains growth Year-to-date, VPG $X,XXX was continue due $X,XXX same strategic or made tours. plan XX% owner of to guidance all new to VPGs and quarter our increased the the our to strong our outlook product Over of VPG come is $X,XXX, basis, new sales. range. growth our new end from proposition for XX% absolute for XX% On above healthy positions year, third Our year. XX% value which are top owner up full owner reflect success have had of the ramp and marketing have decline packaged a of $XX to well market in tours, $X,XXX. from channels have $X,XXX. In channels transactions of an decision was open to prior to second mix. new we above with to guidance investment achieve

XX incremental expect tour Thread, grow months is channels. and upgrade We over next exceed continues than to future to XX% marketing with our VPG sales. Blue aligned new our expectations the Wyndham this pipeline of pipeline which yield channel new higher growth owner Hotels, nearly owner with other

finish Blue We expect an to $XXX all-time high at million. Thread sales the year over

remained Our FICO below outlook is XX%. At originations for the average FICO quarter, loan below the finance only provision of of and portfolio, XXX, loss and well our the quarter. the which our third consumer indicator for our XXXX full unchanged XX% performance end key year performed in third XX% year-to-date, is score XXX. to levels is had at Delinquencies portfolio the

year. coming are making transactions Coming our to its reduce that cost exchange XXXX perspective, is Accordingly, nearly driving All Clubs. to strength in propensity in is reason travel travel the million. reductionn -- and but full more combination year moment, to our pre-COVID in up a segment our exchange year to adjusted ramp-up continues changes we clubs details more segment the year, that lower XQ this Membership Instead, EBITDA the for the into continued occur of Ownership while provide in our business by levels. toward put in perform to to ramp for decline of full throughout transaction both well. a slower-than-anticipated segment. reduction end in Vacation propensity through the and it guidance $XXX XX% maintaining the of guidance will off Vacation on our propensity lower our levels million Ownership Travel a lag exchange propensity would expectation lower we changes will focus year-end, of would and structural expectations a was operational structure experienced Mike all, the exchange year. To membership clubs. These range due and maintain prior $XXX us Travel to and in This in The with XXXX headwind allowing streamlined. and business expectation Travel continues exchange enter challenged to was our in to

last the and EBITDA requirements, of healthy Membership a capital with it $XXX Travel over As and adjusted and has to had of million adjusted worth million look is EBITDA we the cash X $XXX XX% returns strong ahead business margin. low next quarters, reflecting revenues The year, flow.

travel We RCI expect that at trough Travel revenue momentum QX for growth due combination and and a and in propensity will trends stabilizing mark to the transaction pricing Membership our clubs. and of

strategic Vacation front, business the to the Sports rights we Ventures, resorts of Sports licensee brand. Hospitality the Ownership On and of the Illustrated hotel acquired the

popular network leisure in sports including plans, college located destinations. and of Our teams towns in resorts

and add We goals Vacation Among the was club a under we vacation Ownership revenue streams the under our Leisure Illustrated intention to Resorts be managing at launching Brand. Travel and the ownership incremental Day will shared Investor Sports the strategic brand.

most sports are as of We Alabama, with Resorts of years and nearly name been the Sports University the portfolio the destination XXXX. this open the home in late in to first is proud Illustrated, XX legendary of to Sports celebrated expansion selected college Illustrated with launch content. Tuscaloosa, in has Alabama projected

manner. in Our Illustrated capital-efficient ownership inventory Vacation goal to Sports is develop a

the inbound inquiries pipeline have additional significant and the after consideration following announcement. Tuscaloosa We locations more several in

our initial look the to by you are portfolio to strategy brands and sharing add We coming forward of with representation over to we new quarters. excited more our the

the a remember business therefore, conditions. timeshare dependent for economic ownership vacation XX% of travel within have the and owners key differentiator fully paid is timeshare, of to prepaid important it's reminder, that their choice on our to for model a is industry. leisure our As the less nature

Hug. will of healthy and our we as This out recurring in most COVID. With reasons detail time have to that would resilience proven on more and for hand continue time the economic the performance, now we demand call of coming one mix like a has our seen business among historically, of timeshare recently expect enter As challenging revenues owners our resilient to is been over be to I predictable and environment. again, more we Mike

Thanks, Michael, good and everyone. to morning

provide year. X% earnings Year-to-date, include adjusted Coast As the respectively. achieved as spite X comments and reported All as to and as was share for the EBITDA U.S. adjusted sheet adjusted and year, of the our diluted cash several to in the and unless of EPS X% refer quarter, in increases million is EBITDA and prior balance East my the outlook the our XX%, of up EBITDA expenses. third specifically third growth quarter in remainder growth growth will headwinds results, adjusted which period and our color per healthcare well $X.XX, The on adjusted fires I'll of more the of Maui, of the of same hurricanes $XXX flow discussing Florida well update comparisons quarter higher-than-anticipated XX%. stated. We is in third

our adjusted push of individually material, representing guidance an of and reported the $X range. Vacation $XXX lower amounted results of the We quarter, XX% revenues tours in new VPG the of Ownership XXXX of our of opening associated also locations, our Vacation in of tour expectations. segment owner ramp-up incurred to top was both The pipeline marketing marketing quarter to EBITDA million to they our end incremental X%. benefit Ownership package of and increase are $X,XXX the and the above Although to combined beyond. growth and end X%, delivered our third increased some additional while in expenses XXX,XXX with also segment million million, which $XXX not designed tour flow

in million has $XXX the quarter third member compared year. travel of recover, Adjusted $XX our compared Exchange EBITDA XXXX. $XXX membership the in offset to transaction in quarter million prior million not started reduction Revenue to to potentially. but to million enough in was was the in the $XX segment count

exchange into headwinds continue to propensity the fourth expect We quarter. transaction to the

our to sheet. Turning balance

quarter, per remains the an return the shareholders the Through and third million quarters through dividend to to position paid recorded And of of X repurchases year, access strong. we ability share financial a $XXX repurchased $X.XX of we ABS October, continuing our continued stock in and Our $XXX third dividends. In of common a first capital share. we average advance closed in this with on weighted million of market coupon million and basis. our regular a of XX%, $XXX year, to transaction the to X.X% demonstrate rate transaction

working condo quarter, capital XXXX. Adjusted $XXX to our year. debt. to corporate compared on the is cash X $XXX million last X portfolio, months, free $XX ABS during items to increase payments through and million certain in loan months, due Similar maturity other the in and period to year-over-year our facility moved first on higher million an originations addition, flow same interest September date we our In this the the renewed was

year, full For conversion majority free the in from the the cash with quarter. expectation fourth of generated our for XX%, is flow around flow free EBITDA cash to be it for adjusted

purposes leverage the quarter. at corporate net X.Xx ratio was covenant third Our for of end the

the ratio year our expect leverage to the decline below continue X.Xx. to We to by end of

Turning to our rest of for outlook the year. the

full for expectation adjusted EBITDA over to $XXX million, a our between reducing are range to year X% increase XXXX. X% We to million $XXX

Our between expectation for million. the fourth of quarter $XXX million is EBITDA adjusted $XXX for to

Vacation our Ownership, continue we strong to in and With business ability respect timeshare core its sales confident to to performance. remain deliver

million. Related increasing in VPG of net fourth our we guidance sales $XX and improved VOI of to adjusted are for the be segment, to to $X.X $XX for to stock-based in Membership around million anticipate million compensation effective year tax of to Travel $X,XXX be expect In $X.XX quarter. a EBITDA million $XX billion full of the rate quarter expected our be the the on XX% fourth expecting in & We range are to outlook $X,XXX. we $XX XXXX with quarter fourth for interest range billion gross EPS, to to around the

rise next interest stabilize to we ahead at XXXX levels rates in rapid 'XX to expect and XXXX. of in the Looking year, elevated

our our incremental on expense $XX headwind is interest securitizations XXXX, such, to expectation XXXX. an asset-backed once As be similar will to adjusted again EBITDA million in that

adjusted We'll can account performance, the our color as pleased Kevin, well-performing months, to first As in return quarter our of earnings over growth we longer-term in our updated up XXXX. In we membership of planning to us the EBITDA over also capital impact adjusted our per process of continued please XXXX full view the revisit in next interest slower continued into outlook. that, This to diluted more quarter continue and questions? with provide take the as double-digit growth horizon, the business. we of are growth summary, open you will will time our VOI allow the well rate call travel our environment few our the third share shareholders. With take and

question first is Greff from Our Joe JPMorgan. [Operator Instructions] coming from

And next Michael, travel is here that at then next the less look you it business year, negative change going trough to year quarter. What as is you do next in of what year? than when about think mentioned both just travel the clubs? Or year it a you membership in that you and was this gives growth fourth the is think year? exchange confidence you rate

with we start No, be growth Membership sector and the one. year Well, for a number let to a segment for reasons. me the expect XXXX of Travel different

first me the let jump to question is. back So

As -- propensity exchange of levels. we in masked exchange a the expected to happening went saw what came reflect was what into year. XXXX a similar little XXXX, revenge to levels. strong XXXX exchange VOI propensity. we was think And super we bit I travel pre-COVID trends in in with was propensity pre-COVID

really As of post-COVID in and XXXX, normalized travel VOI COVID forward. travel unmasking in and exchange the trends came

home levels in pre-COVID and recovery It's around I had XX% because second to level and dip, owners The the what had within we that were returning expected Travel of timeshare of no the travel. that year down, below we it I we Instead, that year the rate pre-COVID throughout rebound for different saw as that's propensity was a forecasted, forecasted this is first the rebound what X industry levels. to more had slightly to as to getting their saw resorts. that I that Wyndham more a in leisure quarters, half mentioned instead propensity and within continued of Club progressed, was

months. us to in we X trough? last QX we stabilization So confidence a gives what propensity is seen have over that the is few Number that going think

once is travel once revenge and what So through anchor our we XXXX as propensity a good true we've is. made the think way the we have

the our is again, absolutely million lastly, taken transactions XXXX, in And grow refer that's period. side, about that our You've through are fact RCI and membership happening. And the heard Club membership to beginning clients. year, as then flat us loss head the dropped we of $X.X on account COVID of finally, to to that into major last although the into Travel one is

loss, that year. second start next we're will in So our the in to we absent actually clubs, of and growth lap that travel seeing quarter

know that's travel answer what's but a a actions expect, the QX, should taking I we will lot profile return A, happening. membership through visibility absolutely travel clear the long in we're number what trends and So in end, with But a and in to growth to the of of in to return also travel the a membership XXXX.

you're help business. out? much that you how quantify of versus mentioned reducing that? also you revenue this that then dependent And costs And costs is in Can fixed coming

through Well, we revised aligns -- here that sure to we cost are, as the structure overall I mentioned, going in to to our be that going make QX forecast.

you case, the of later structure quarter. forecast. bit an more reflected to You that. But sure make proactively this we've the look already it, is at our that give forecast instead expect revenue of reactive realities of it. realities is our to to And to being the our and update as would We'll year cost will begun in adjust revenue a the we

Katz question Jefferies. from is Next coming from David

deal. just those that I it sports very, just an could to are out on opportunity fans this our us a minute SI maybe opportunity vision potentially see help of But your large. you to what focus how there as set the And And expectations for is? is be? for the really us could very big huge wanted

quarter is the of the we've a bit let on for this David. Well, take with -- call, a me little thanks number been subjects. just first since me of this And answer the let different question, on time

the of Ownership financing currently model basis as primary about the have and the grows. all, the operations XX% streams. we're outset year, model looks be Vacation margins used to are tours new you timeshare Wyndham, First into inventory. this because annual system is, with similar the talked it's the as owners revenue in sale XX% first new secure similar difference targeting as opportunity XXX% the overall Wyndham. In of returns to we about income the very to club excited have today, resorts Vacation we well Ownership, owners new the model streams, from on X Three the the of new an things and The our business to and and with that

model sports. We not we the companies. all decade, after with in people do than wanting us Sports States, number Illustrated, about has more not the timeshare just appreciate Illustrated. securing with around ways, Over excited addressable but The we announcement, the that to the lifestyle your been part It's United to probably the there's outreach last their became passion, college of it inventory when also and a universities because issue social developments signed passionate we of reputation received wanting America that reach in the media, excited market. day even a anyone's growing of different data, And has the more with the infrastructure. be deal were from Sports not

it's months, announcing be that us, with timeshare we're reach to next for really So new the will us XX about base. most mentioned the there's to Illustrated owners. When partnership additional timeshare but households. probably million will additional reach Sports the We're safe that team excited clear gives that about that at population us locations. than around a excited lot over get we the XXX it reach the today, looking household And million to forward U.S. more for XX It's look to you million we're over sports allow college say started. owners few

the in into that on pre-sales. eventually say, we going Alabama running XXXX. mentioned, a in get and one later to work open of needless will I have As to in lot But and up

And expectations. quarter ago. commentary it I think Blue exactly think ask you wanted as Thread, I same was which when of the ahead about is the Now we question follow-up was running a is the commented to your

the more? that? the drives brains really reasons, that getting that is our function need that is what months. question integrated accelerating, a is but of over of hit of Is scale, is, could is topic that's of a it it couple larger for the or obvious something that the And just past topic drive One that's

anything, because scale, team strength Hotel team closely Wyndham clarify, you the the Thread say really has our larger accelerate to accelerating to us and just with to the and it when Blue tying relationships Thread into allowed So And them. the is of down Blue performance maximizing initiative. comes

operations, Blue We sales. have of lean but space, call center outside package and into only to invest heavier not continued starting also forward-looking into our to this through Thread

matters, job the Hotel Rewards, ultimately, we Wyndham And benefited done Thread Wyndham Wyndham matters programs, and them. have the scale Wyndham yes, has data Reward that's more Blue team So grows its and a It's the the space. in opportunity great growing us. benefited more hotels

is Bank Your Asad next from question America. coming of from Dany

start for can off, Just buckets last like year, from like this cut components changed the just to we for different through the quarter? walk the of what guidance

Hug. Mike Thanks really the This is for It's pretty a walk. question. simple

of fact Florida a Hawaii, to that all, the First but comments the they totaled and hurricanes to $X third individually the expenses. that the that my in some touched Coast being up quarter then I few healthcare immaterial, was the million, on fire and in by things higher impacted were East

quarter. remainder that from guidance really guidance, we the previous in million is for you membership the $X get travel and there the the have about to to the about reduction due the forecasted fourth business million have So current $XX to

on reduced easy by So the membership. really and travel revenue driven pretty down forecast walk

Got it.

conversion next as what at through the Okay. takes when and and a year free you the year? X to whole we like can then go maybe of EBITDA and to this from kind from just flow to compared kind where -- this helpful. puts cash 'XX we drives us super from of can of turn look That's year walk if 'XX, And then

Yes.

like build big our securitization the available receivable fourth the that drivers remaining in that cash conduit big And towards get the below $XXX continued X to busiest start long-term of That's then this to experiencing the activity, a about our inventory the this inventory market we've the time our think drivers be as way up be quarter I basis, us. that million is fourth going spend. flow spend portfolio and quarter. On the We And are talked to inventory why into Sports and the is is into we future Illustrated ABS summer, continued deliver are expect for weighted sheet. we year to what models. to several throughout we're in in year going is guys the that X quarter. the on thing year. flow years always, into inventory know, the the transactions reason balance the fourth cash ABS a the as other of have And capital-efficient years do about you to

to significantly we'll an investment market, the But impact from us. perspective inventory So [indiscernible] which free truly cash flow the our conversion. shouldn't remains need make to it's ABS strong

we the saw, smart transaction being our inventory then you million. below and October and $XXX spending done keeping As got us in

from Our next Montour is question coming from Barclays. Brandt

you just I'm Hug, little that the into question commentary. could a deeper. -- dive flow Mike free cash bit back maybe cash conversion free flow curious XX% if we could on

little a were it's think we I expecting than before. lower what bit

mix. the that obviously, on there's what talk change what us are guide a that's maybe if and dynamics and lending of just sort as especially that? the you dynamics flow But down. a of and Travel I down better you're could led growing Membership free side, a probably through VOI the that know, cash guide So percentage conversion business, more could of to

is the right very free far strong. You're cash the as as conversion and business exactly generation Travel Membership from flow

mentioned continue opposed the then the grow that's terms to margins But there's continue we the the of definitely them relates in to them. And then sales the percent talked XX-plus a of is flow into year, at XX% term answer, second first obviously, the into One about. able do we and in receivables one of that get the advance in reasons free like as those rate. as the portfolio, the next of the the not to all as range as second deal, half are get to about that cash drivers transactions business I into previous in and we think we the timing you then to quarter year, we're previously great And generation. the of it if the most, ABS of conduit,

So in not The we interest corporate growth in as timing is continue primarily have one right? receivable expense, That's my mind, the obviously timing. permanent. far the That's headwind it's portfolio. to as on

So with Investor going that to interest rates from just what's But interest the it way to the happened the higher we most with model the compared we be we are manage seeing Day, have into of is the securitizations. expense. getting portfolio and ABS

And When or is at of forward What something you Okay. your sort license follow-up related the my The your brand -- Wyndham, this choice to hostile guys. to of with what you Great. Wyndham, from if Thread. the happening to within away agreement? your -- then Blue from would or are proposal documents? was happen transaction those for contract the your go stipulations to license look acquire

M&A no impact. document, the legal through negative have would going any basically, Without whole Yes.

protect very do to relationship we need Wyndham our Hotels. really and agreements with Our growing valuable successful what continue

Okay.

So choice your or would have that Wyndham that, Hotels you by became would of something like still grandfather database? -- in you access Wyndham to sort Brands

Correct.

question from Patrick next Securities. from Your Truist Scholes is

Choice Choice from potential any could I follow-up And guest hypothetical downside, the is be on combination upside yellow. reward a It there Certainly, plus that? and like there Wyndham. massive believe be sounds system. their primary question Michael of wouldn't has color Mike, but

plus you to -- just potentially limited would at would plus that point? Yellow Thread be just Blue Thread legacy or the be the be Wyndham it the Or hotels? would you So

a said broadly more the key say I'm comment bit in customers a general whether in allow discussions, to earlier, new not me What marketing or But that the more is discussions. growing to marketing to and any you party customer is growth related to to gain and is party then let to universe, to David data ownership that, to because Well, and opportunities. that is those not if being space vacation similar would and something access I was key to it what of more case, very partnership, one I those question open that's any the were partnerships to that your new create this up beneficial.

space, any is broadly has occurs answer our Ownership a positive to possibilities my Vacation business. So the it time to VO in be that

Okay.

hope fair you it, there's blue/green to that And you -- their no again, So guarantees. fair existing to you'd would but that in access think would think to get contracts. certainly,

devil the details in out lot a possibly be worked to here. of So

taking macro sort the question. a just, high-level back, then step Michael, And on of

Your average household ownership recall propensity you've income, $XXX,XXX. in that product noticed? I for or purchase XX as Any your discernable to buyer use a to vacation customer changes $XX,XXX that of

question And in credit think And this, really business. because a throughout I our reground happening like that appreciate on really I COVID. what's we our Yes. quarter in it's to quality important ourselves raised

important, our in is away opinion, the in The end well. guidance. it's Our of performing range. Ownership to And my FICO or anyone matches second, a going XXX, the quarter our the VPGs business. at above take to are which very Score portfolio, industry. We I'm on to from Mike Vacation ask just this extremely high speak strong raised about

consistently of of -- last consumer our primary weakness. to business bookings not driver our Our portfolio remains core our and signs of perform showing continuing are for strong is well forward ahead the and year. The is

commentary I Our and household income well-performing Leisure & distract now. want the of that, actually as October, not nothing the And that here has that we metrics. performance through weeks first in that's changed. the business, guidance the consistent extremely VO our month foundation quarter show is around change Travel XXX,XXX to don't almost the overall related is X its sit of which would or QX signs did our to in its of And indicate business happened in of an from of overall noise October

on touching just a the then And little more. portfolio

all, We things. few the a First about talked provision. of

good and a for XX%, which, portfolio. the think, on over again, quarter came guidance under was Our I performance shows it once XX%, the

increase QX up in portfolio the was there far but seen we've growing. QX movement to delinquencies that, QX if look for case. loss at the when is What was QX, from the notice that's to the moved always XXXX increase, from You'll except about a positive and XXXX wasn't you as my as since opinion, in

it's that securitization you portfolio proof increase, done one increase, important they're of it as they when because, appreciating very believe at the just transaction. the always it's is actually better also but we So the related confidence others manageable that what a the the for finally, a the because capital with love free to And in purchasing purchase essence, that that's me, than ABS generates then expected. look was notes that in we

and move most down below So has XXX portfolio subprime, other overall, XXX, the confidence that lot you this importantly, from dropped when I sticking to we're far can't seeing will, year as had move big the really us be XXX with and happier even a of performance with industries to move allowed performance. and in to portfolio throughout results have as to see that our if the

Woronka coming Deutsche Chris is question from Bank. from Next

some efficient today they past, the compare can weren't talk we're those in kind historically? for you're them Michael, some far. these mentioned the And prepared been you owner you going these that cost always is, market sales. all I always not most I to details new or think and stimulate why in best first effective. maybe back better might open you tours Thanks package the you and I the one wonder comments for the of Can about of know so and they've guess contrast? channels if you be the than of I

package absolutely. Wyndham we gives -- that out. But overall toward commentary, into from day your XXX, that far we to X locations on one the will pipeline. in channels. it us an have model into of there prevent you visibility create investment we starting XX didn't to a open more little XX FICO market is making that doesn't that but pipeline stepped your to when package a band diversification months selective we subtle but get at in profitability bit very us as marketing those an been well are that. we more We've make today. starts our sure remain lean performing channels And generator, need to has our key are been really Yes, ensure space the the to can week on traditionally and into that characteristics It from is our to want also distinguishing in we back too of

what incremental investment opportunity So create our early diversify already on it's signs our through and pipeline we've and -- going to into open being in that. in the the selective doing really package and starting workflow we're exactly in marketing success in of seen

And of obviously, will takes, just -- with free lot But revisit if helpful. whatever so just we a already and I going might I happens. puts -- for you've I'm guidance, in what is guess the and said kind and is you you headwind your estimate, the would not year, And thinking somebody you've to guess any this EBITDA if I with is 'XX current why anything that? for what the shared acquisition in that Very flow going come -- at interest. least up impact or there's below a to higher? on be mean, of is generation, then ask inventory million anything of cash an us I'm the not conversion there question lower for spend $XXX there I asking is an placeholder flow reason mean, like be terms below free per to continue is, year. days cash Okay.

Well, of the M&A that's think perspective, yes, capital we you cash cash we I the higher. on be this that else Everything timing, conversion. free think I walk increase of an the share even everything free in allocation, receivables and think move would as flow Obviously, buybacks. interest the except forward, about free we're flow portfolio, cash You as we XX% But favorability outside kind right? expect that corporate for the the is as far conversion, maybe across overall, a if the think XX% when flow make that decision right, the about dividends, from spend. back would expense, inventory acquisition north and in

of in due going with we sales So price we than longer out increases. performance we the with in to the nice to very, cost lower -- have sales is sheet balance kind 'XX. this and our model cost the came even last of coming on The expected, inventory of very when year,

I plus. flow conversion So of the the no cash being free change say view in would long XX% term,

Our next is Zaffino Instructions] [Operator from coming Oppenheimer. from question Ian

I for have ones. on Isaac just is Ian. quick Sellhausen This X

that remainder and business, VO year? the for sort On touch the for guess, of can you double-digit tour the be still the of expectations the on I range? should flow just in that

acquisition secondly, Or for capital of haven't the you guys you announced that then And that something commitment? guys the illustrated sports rights was disclosed? large earlier, is that

on the both The the higher Illustrated the QX flow the growth tour then and for year, it teens. tour to Mike Well, let full expectations I'll for double-digit flow, acquisition. Sports will be me hand and on touch

in So flow and reflected continues strength our obviously QX tour that year full number. -- our into

is then development. haven't book, of the that or acquisition I And Sports is would of land we disclosed purchased we brand, number but on half [indiscernible] inventory that it say what Illustrated in the

find Now partner I us. do for as that development we'll going also a will mentioned, forward,

additional sell recovered because costs will overall, paid is expect we we So as acquisition But most that of the product. that. cash door I drag the don't of be out that flow the cash

We reached to or over of I'd comments. further any the end like session. floor back for the turn question-and-answer our closing

We Thank performance with our metrics. quarter Ownership particular, of Vacation you, in Kevin. the were the and core pleased third

day. Brands. who for great and that will of Band Resorts owners associates deal, be and on have a Sports the portfolio. our deliver Authentic guests. we like first working brand I thank Eastern grow several hard our want of deals great would Cherokee of take thank Sports of and vacations everyone announcement partners our also all We moment are to what Ventures, Illustrated I to with Thanks Hospitality executed expect a also to the the on the our portfolio to and

conclude teleconference does That you. and Thank webcast. today's

you time a your day. today. at your and disconnect thank may You participation We line this for wonderful have