Wyndham Hotels & Resorts, Inc. · NYSE:WH
Wyndham Hotels & Resorts — Q1 2021 Earnings Presentation
38 slides from Wyndham Hotels & Resorts's earnings presentation, Apr 29, 2021
Slide 1: La Quinta Inn & Suites by Wyndham Dallas Plano - The Colony
La Quinta Inn & Suites by Wyndham Dallas Plano - The Colony Dallas, Texas, USA
Slide 2: Introduction to Wyndham Hotels & Resorts
Introduction to Wyndham Hotels & Resorts Largest Leading Asset-light Primarily hotel franchisor economy & midscale business model leisure-focused by hotels brands in attractive with significant cash “drive to” portfolio worldwide select-service space generation capabilities of hotels 8,900+ 797,000+
Slide 3: Select-Service Segments Lead Recovery
Select-Service Segments Lead Recovery MTD April MTD April Economy segment Midscale segment occupancy & RevPAR occupancy & RevPAR now surpassing within 90% of 2019 levels 2019 levels Cancelation Website visits and Call volumes Franchisee collection rates returned to booking volumes within 90% rates w
Slide 4: Origin Red Rocks, a Wyndham Hotel
Origin Red Rocks, a Wyndham Hotel Golden, Colorado, USA
Slide 5: First Quarter 2021 Performance Recap
First Quarter 2021 Performance Recap =} $97M (s) $59M {} +17 pts Adjusted EBITDA © Free cash flow © RevPAR outperformed the total industry © Y 112 finh >70% +120 bps New contracts signed; Conversions as a Growth in 90% of 2019 volume % of openings global pipeline Data as of March 31, 2021. Reconcili
Slide 6: Occupancy Declines Continue to Narrow
Occupancy Declines Continue to Narrow MONTHLY WH U.S. OCCUPANCY @ 2019 @ 2020/2021 67% 67% 58% 58% 58% 58% se% 59% (2 points) 57% (33 points) 25% Jan’ 20 Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan’ 21 Feb Mar Apr MTD WYNDHAM | Note: April month-to-date includes occupancy comparison through Apri
Slide 7: ADR Continues to Improve
ADR Continues to Improve MONTHLY WH U.S. AVERAGE DAILY RATE @ 2019 @ 2020/2021 (14%) : $78.04 (23%) $65.84 $64.91 $62.40 Jan’20 Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan’21 Feb Mar Apr MTD _WYNDHAM- | Note: April month-to-date includes ADR comparison through April 17" HOTELS @ RESORTS
Slide 8: WH Select-Service Brands Continue to Outperform
WH Select-Service Brands Continue to Outperform Higher-end Chainscales MONTHLY U.S. REVPAR CHANGE VS. 2019 (1%) (0%) (5%) (20% (24%) Cay (25%) (27%) (29%) (28%) Economy/Midscale Advantage (65%) (51%) (59%) 60 (63%) (64%) (65%) (63%) (68%) (67%) (65%) @ WH Select-service brands M@ STR Higher-end chai
Slide 9: Net Room Growth Tracking in Line with Expectations
Net Room Growth Tracking in Line with Expectations 2019 QUARTERLY FIRST QUARTER 2021 CONTRIBUTION TO ANNUAL TRENDING IN LINE FIRST QUARTER 2021 NET ROOM GROWTH WITH 2019 PACE NOTABLE ADDITIONS Conversion Origin Westminster, a Wyndham Hotel Hotel Origin Morgantown, a Wyndham Hotel + Viana Hotel & Spa
Slide 10: Origin Westminster, a Wyndham Hotel
Origin Westminster, a Westminster, Colorado, USAy 10 t
Slide 11: Turtle Island Beach Resort, a Trademark Collection Hotel
WYNDHAM Turtle Island Beach Resort, a Trademark Collection Hotel San Pedro, Belize HOTELS & RESORTS
Slide 12: Microtel Inn & Suites Lac-Megantic and Viana Hotel & Spa
Slide 13: wr! ra
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Slide 14: Wyndham Xinyang Downtown and Microtel by Wyndham Tianjin
Wr |MIGROTEL a Ca em | | | a! <8 ys MICROTEL AeuReHAE z = BY WYNDHAM,, ndham Xinyang Downtown Microtel by Wyndham Tianjin inyang, China Tianjin, China HOTELS & RESORTS
Slide 15: Diversified Pipeline Provides Runway for Growth
15 Diversified Pipeline Provides Runway for Growth TOTAL PIPELINE @ 3/31/21 25% COMPOSITION HH New Construction Conversion — 34% inthe Ground PIPELINE BY CHAINSCALE (000s) Economy Midscale Upscale 48 GEOGRAPHICAL MIX Hi vs. International 64% INTERNATIONAL MIX Hl china MSEAPR [EMEA Other | 100% WYNDH
Slide 16: Asset-Light, Franchised Model Generates Strong Free Cash Flow
Asset-Light, Franchised Model Generates Strong Free Cash Flow ($ Millions) a +$59M eal Cash oe $97 oe ($13) co) 95S ($6) Beginning Cash Adjusted Interest Capital Working Dividends _Other Ending Cash @ January 1, EBITDA © Expense, net Expenditures / Capital and Financing @ March 31, 2021 p vclooment
Slide 17: 2021 Focus
Slide 18: WYNDHAM
WYNDHAM
Slide 19: Compelling Value Proposition for Franchisees...
Compelling Value Proposition for Franchisees... LOYAL & GROWING CUSTOMER BASE DRIVES LOWER COST BOOKINGS * Trusted, iconic brands endorsed by the world’s largest hotel franchise company reassure travelers that they can book with confidence + Over 70% of hotel room revenue in the U.S. is generated th
Slide 20: ... That Has Historically Delivered Strong Returns
... Phat Has Historically Delivered Strong Returns ‘land costs for economy hotels acros otel performance. Return on invested ca Cost per room ~$75,000 Loan-to-value ~70% Franchisee Investment $1,575,000 RevPAR $53.00 Revenues $1,355,000 Operating expenses $705,000 Brand fees $115,000 Interest expens
Slide 21: Wyndham Grand Flamingo Cat Ba Hai Phong, Vietnam
Wyndham Grand Flamingo Cat Ba 21 Hai Phong, Vietnam WYNDHAM
Slide 22: Strong Balance Sheet & Substantial Cash Reserves
Strong Balance Sheet & Substantial Cash Reserves BALANCE SHEET Total liquidity at March 31, 2021 (Before giving effect to 2026 Notes redemption) $1,265M Major maturities due prior to 2023 None First lien leverage ratio of 5.0x testing waived until: June 30, 2021 First lien net leverage at March 31,
Slide 23: Maximizing Capital Allocation For All Stakeholders
23 Maximizing Capital Allocation For All Stakeholders MAINTAIN STRONG BALANCE SHEET Repaid all revolving credit facility borrowings through 3/31/21 Redeemed $500 million 2026 Notes on 4/15/21 Approx. $750 million of liquidity (post notes redemption) No near-term debt maturities 3-4x Leverage Target
Slide 24: ESG Efforts Ongoing; Continued Investment & Focus Despite Pandemic
ESG Efforts Ongoing; Continued Investment & Focus Despite Pandemic A CULTURE OF DIVERSITY, EQUITY & INCLUSION + Pledged CEO Action for Diversity, Equity & Inclusion + Executive-level sponsorship of all Diversity, Equity & Inclusion Associate Business Groups + Perfect score of 100 on Human Rights Cam
Slide 25: Clear Focus & Priorities to Drive Shareholder Value
= U & PRIORITIES TO _WYNDHAM —
Slide 26: Core Strengths
Core Strengths PRIMARILY PREDOMINATELY SELECT-SERVICE POWERFUL LEISURE-FOCUSED “DRIVE TO” LEADER GROWTH ENGINE LOCATIONS = . —— j ‘Super 8 by Wyndham Austin/Airport North Austin, Texas, USA a ———_—_-S—ti‘ el > 5 LOW RISK BUSINESS MODEL
Slide 27: Leisure Guests Power Our Business
27 REASON 1 Leisure Guests Power Our Business NEARLY 70% LEISURE FOCUS l 9 Leisure Travel 69 % “Everyday” a Business Travel 27% ——_ All Other 1% Corporate LS re Transient 3% Group Business |) 1% WYNDHAM | All data based on 2019 results. HOTELS @ RESORTS —
Slide 28: "Drive to" Destinations Not Reliant on Air Travel or International Travelers
28 REASON 2 “Drive to” Destinations Not Reliant on Air Travel or International Travelers 87% U.S. HOTELS IN “DRIVE TO” LOCATIONS Suburban 35% Interstate 87% Small Metro Airport Urban Resorts All data based on STR census March 2021. 96% OF U.S. GUESTS ORIGINATE DOMESTICALLY US. 96% Europe |) 1% Canad
Slide 29: Wyndham Choice IHG Hilton Marriott
Wyndham Choice IHG Hilton Marriott
Slide 30: Significant Growth Opportunity in Large Conversion Market
30 REASON 4 Significant Growth Opportunity in Large Conversion Market UNIQUE VALUE PROPOSITION IN TODAY’S MARKET Our brands outperformed their competition in the U.S. by -500 bps since onset of the pandemic Our franchisees leverage Wyndham’s purchasing power to significantly lower operating expenses
Slide 31: World's Largest Hotel Franchisor with Minimal Exposure to Asset Risk
REASON 5 World’s Largest Hotel Franchisor with Minimal Exposure to Asset Risk NUMBER OF HOTELS WORLDWIDE PERCENT OF FRANCHISED HOTELS 8,952 Wynchar i 27% hcice SN 7.662 Choice 00% 7,138 6567 Hilt NNN 26% 5,959 HC TT 22% Meritt 7224 Limited exposure to operating costs and capital requirements associa
Slide 32: Strong Leadership Navigating Through the Storm
Strong Leadership Navigating Through the Storm + Served as President and Chief Executive Officer of + Served as Executive Vice President and Treasurer of Wyndham Hotel Group (2014 - 2018) Wyndham Hotels & Resorts (2018 - 2019) + Served as Chief Executive Officer of Wyndham Destination + Served as Se
Slide 33: The Wyndham Family of Brands
33 ECONOMY wn MICROTEL ‘BY WYNDHAM oat aN Howard Johnson BY WYNDHAM Travelodge The Wyndham Family of Brands Wherever people go, Wyndham will be there to welcome them. MIDSCALE RAMADA BY WYNDHAM nr. WINGATE’ BY WYNDHAM Ba HAWTHORN” fo a AmericInn’ BY WYNDHAM = BAYMONT BY WYNDHAM UPPER MIDSCALE UPSCAL
Slide 34: 2021 RevPAR Sensitivity, Illustrative EBITDA Example & Reconciliation to 2019
APPENDIX 2021 RevPAR Sensitivity, Illustrative EBITDA Example & Reconciliation to 2019 Performance ILLUSTRATIVE EXAMPLE RECONCILIATION ($ Millions) VS. 2020 ($ Millions) TO 2019 2020 Adjusted EBITDA $327 2020 Adjusted EBITDA (incl. $40m COVID savings) $327 EBITDA impact per point of RevPAR change -$
Slide 35: Adjusted EBITDA Reconciliation
Three Months Ended Year Ended March 31, 2021 December 31, 2019 Net income $ 24 $ 157 Provision for income taxes 11 50 Depreciation and amortization 24 109 Interest expense, net 28 100 Stock-based compensation expense 5 15 Development advance notes amortization 2 8 Impairment, net - 45 Contract termi
Slide 36: Non-GAAP Reconciliations
36 APPENDIX Non-GAAP Reconciliations The following tables reconcile certain non-GAAP financial measures. We define free cash flow to be net cash provided by operating activities less property and equipment additions, which we also refer to as capital expenditures, and adjusted free cash flow as free
Slide 37: Calculation of Franchising Margin
37 APPENDIX Calculation of Franchising Margin Consistent with our peers, franchising margin excludes the effects of the marketing, reservation and loyalty funds from Hotel Franchising segment revenues and adjusted EBITDA, as well as license and other fees. Management evaluates the operating results
Slide 38: Definitions & Disclaimer
38 APPENDIX Definitions & Disclaimer Definitions: Adjusted EBITDA: Represents net income excluding net interest expense, depreciation and amortization, impairment charges, restructuring and related charges, contract termination costs, transactionrelated items (acquisition-, disposition-, or separati
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