Wyndham Hotels & Resorts, Inc. · NYSE:WH
Wyndham Hotels & Resorts — Q2 2021 Earnings Presentation
38 slides from Wyndham Hotels & Resorts's earnings presentation, Jul 29, 2021
Slide 1: Wyndham Hotels & Resorts Investor Presentation
WYNDHAM HOTELS & RESORTS nvestor j Presentatio LULWN WA MS & ate Se a La Quinta Inn & Suites by Wyndham a) . p ‘stl \ ake al 4 Nashville Downtown/Stadiui 4 ae i Nashvillé, Tennessee, USA wh = fei das es “aR
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 9,000 798,000 9
Slide 3: Select-Service Leading Recovery
3 Select-Service Leading Recovery U.S. Economy RevPAR U.S. Midscale RevPAR exceeding 2019 levels surpassing 2019 levels for 3 consecutive months for the past 4 weeks Cancelation rates Website visits and Call volumes Franchisee returned to booking volumes consistently collection rates pre-pandemic le
Slide 4: Strong Occupancy Across the U.S.
Strong Occupancy Across the U.S. JULY MTD WH OCCUPANCY LEVELS OCCUPANCY SCALE 030% Ti sonss —— (}50%-55% Hi 60%-70% Hh 30%-40% [Bh 45%-50% (Bh s5%-60% HH 70%-100% WYNDHAM 4 | Note: July month-to-date includes occupancy levels through July 17%, HOTELS @ RESORTS
Slide 5: Q2 2021 Performance
Q2 2021 Performance ( Howard Johnson Plaza by Wyndham Dubai Deira 5 Dubai, United Arab Emirates
Slide 6: Second Quarter 2021 Performance Recap
Second Quarter 2021 Performance Recap = $168M () $104M =| +900 bps Adjusted EBITDA; Free cash flow ‘© Margin expansion vs. 2019 © +4% vs, 2019 {7 +16 pts O+40% +580 bos le) le) RevPAR outperformed New contracts signed Growth in global pipeline the total industry vs. Q1’21; ~90% of 2019 year-over-yea
Slide 7: RevPAR Surpassing 2019 Levels as of June 2021
RevPAR Surpassing 2019 Levels as of June 2021 MONTHLY WH U.S. RevPAR m 2019 @ 2020/2021 — +7% 61.40 $50.2: $48.47 $47.07 $47.52 $47.89 $37.29 $36.88 $34.69 g32 05 $51.46 $28.96 $27. $15.67 Jan’20 Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan’21 Feb Mar Apr May Jun Jul MTD _WYNDHAM- | Note: July mo
Slide 8: Pricing Power Returns Faster than 2008 Recession
Pricing Power Returns Faster than 2008 Recession WH U.S. OCCUPANCY AND ADR GROWTH GREAT FINANCIAL CRISIS (2008) COVID-19 8.0% 4 YEARS mes 1 YEAR 0.0% 4.0% 10.0%) 0.0% (20.0%) (4.0%) (30.0%) (8.0%) (40.0%) (12.0%) WOO al a2 Q3 a4 al Q2 ai a3) al 6Q3 Qt OB ts GB ss QB '20 "20 20 '20 ‘21 21 ‘07 '07 ‘08
Slide 9: WH Select-Service Brands Continue to Outperform
WH Select-Service Brands Continue to Outperform Higher-end Chainscales MONTHLY U.S. REVPAR CHANGE VS. 2019 8% 3% (6%) (6%) 24% CO (27%) (29%) (28%) CHES) Economy/Midscale Advantage (40%) (53% (46%) (65%) (51%) (59%) (63%) (64% (63%) an (64%) (65%) (E7%) (65%) @ WH Select-service brands (75%) @ STR H
Slide 10: Net Room Growth Tracking in Line with Expectations
Net Room Growth Tracking in Line with Expectations and Seasonally on Pace with Full-Year Target ROOM ADDITIONS MOMENTUM ROOM TERMINATIONS IMPROVEMENT First Half Results First Half Results Second Half Forecast ° Second Half Forecast 40% Retention SECOND QUARTER 2021 NOTABLE ADDITIONS CONVERSION NEW C
Slide 11: The Buccaneer Beach & Golf Resort; Grand Residences Riviera Cancun
The Buccaneer Beach & Golf Resort, Trademark St. Croix USVI Grand Residences Riviera Cancun, a Registry Collection Hotel WYNDH. AM 11 Christiansted,-US Virgin Islands Cancun, Mexico HOTELS 6 RESORTS
Slide 12: BEI San Francisco, Trademark Collection by Wyndham
BEI San Francisco, Trademark Collection by Wyndham NDHAM San Francisco, California, USA HOTELS 8 RESORTS
Slide 13: Ramada by Wyndham Eskisehir; Howard Johnson Plaza Dubai Deira
oe —— Ramada 4 ] <ieomt ip I fig = i WYNDHAM 13. Eskisebir Tur au At ee Emirates HOTELS & RESORTS
Slide 14: Wyndham Garden Nanjing Airport; La Quinta Colorado
mT hep ote : eee Ses | Wyndham Garden Nanjing Airport = =e a 4—Nanjing,. Jiangsu, China — Littleton, Colorado, USA
Slide 15: Days Hotel by Wyndham
Days Hotel by Wy
Slide 16: Diversified Pipeline Provides Runway for Growth
Diversified Pipeline Provides Runway for Growth TOTAL PIPELINE @ 6/30/21 COMPOSITION GEOGRAPHICAL MIX HH New Construction Hus. 26% Conversion International +— 34% in the ea) Ground PIPELINE BY CHAINSCALE (000s) INTERNATIONAL MIX Midscale HM China MSEAPR [EMEA Other | Upscale 51 100% Growth represent
Slide 17: Asset-Light, Franchised Model Generates Strong Free Cash Flow
Asset-Light, Franchised Model Generates Strong Free Cash Flow ($ Millions) — ~60% ‘Conversion Rate ~ $265 7 ($51) ($13) = 7 ($17) a $163 16 ~ Sy ($5) YTD ’21 Interest Cash Taxes Capital Development Other Working YTD ’21 Adjusted Expense, net Expenditures Advance Capital Free Cash EBITDA @ Notes Flow
Slide 18: Wyndham Hotels & Resorts
WYNDHAM HOTELS € RESORTS
Slide 19: 2021 Key Priorities
Slide 20: Compelling Value Proposition for Franchisees
20 Compelling Value Proposition for Franchisees .+. Wyndham’s industry-leading central reservation systems deliver $7 out of every $10 to U.S. franchisees Trusted brands with segment-leading consumer awareness Industry’s #1 hotel loyalty program with 89 million enrolled members Global marketing fund
Slide 21: That Has Historically Delivered Strong Returns
a That Has Historically Delivered Strong Returns COVID basis. Cost per room industry data and are not 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 expense $220,000 Hotel EBTDA $31
Slide 22: Strong Financial Profile
Slide 23: Development advances, capital expenditures and strategic transactions
Development advances $40 Capital expenditures $40 Strategic transactions/acquisitions
Slide 24: ESG Efforts Ongoing; Continued Investment & Focus Despite Pandemic
24 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 Campai
Slide 25: Priorities to Drive Shareholder Value
, 8 >RIORITIES T! P AREHOLDER V, Leavenworth Local, Trademark Collection by Wyndham 25 Leavenworth, Kansas, USA
Slide 26: Super 8 by Wyndham Bullhead City
sys Inn by Wyndham Bullhead City “26 __| Bullhead City, Arizona, USA
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 June 2021. 96% OF U.S. GUESTS ORIGINATE DOMESTICALLY US. 96% Europe |) 1% Canada
Slide 29: Wyndham vs 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 nearly 300 bps compared to Q2 2019 Our franchisees leverage Wyndham’s purchasing power to significantly lower operating expenses a
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 8,969 Wynchar i 27% on Choice (ATT 100% 7,111 6,676 Hit 25% 5,994 HC TT 22% Meritt 7224 Limited exposure to operating costs and capital requirements associated with o
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 Nn MICROTEL ‘BY WYNDHAM oan aN Howard Johnson BY WYNDHAM The Wyndham Family of Brands Wherever people go, Wyndham will be there to welcome them. MIDSCALE UPPER MIDSCALE UPSCALE UPPER UPSCALE RAMADA tAQUINTA WYNDHAM Ka WYNDHAM GRAND DAZZLER DOLCE HOTELS AND RESORTS By wYNDHAM A mower g enc
Slide 34: Reconciliation of 2019 Adjusted EBITDA to 2021 Outlook
APPENDIX Reconciliation of 2019 Adjusted EBITDA to 2021 Outlook ($ Millions) RECONCILIATION TO 2019 2019 Adjusted EBITDA @ $621 COVID-19 permanent cost savings © 40 16% RevPAR decline vs. 2019 @ ~$3.3 million per point (48 - 58) Not in the RevPAR per point estimate ©: License fees (43) Owned hotels
Slide 35: Adjusted EBITDA Reconciliation
Three Months Ended Six Months Ended Three Months Ended Year Ended June 30, 2021 June 30, 2021 June 30, 2019 December 31, 2019 Net income $ 68 $ 93 $ 26 $ 157 Provision for income taxes 25 35 10 50 Depreciation and amortization 24 47 27 109 Interest expense, net 22 51 26 100 Early extinguishment of d
Slide 36: Free Cash Flow Reconciliation
Three Months Ended Six Months Ended Year Ended June 30, 2021 June 30, 2021 December 31, 2019 Net cash provided by operating activities $ 116 $ 180 $ 100 Less: Property and equipment additions (12) (17) (50) Free cash flow $ 104 $ 163 50 Payments to tax authorities related to the La Quinta acquisitio
Slide 37: Franchising Margin and Adjusted EBITDA Margin
Three Months Ended Three Months Ended Year Ended June 30, 2021 June 30, 2019 December 31, 2019 Hotel Franchising segment revenues $ 283 $ 331 $ 1,279 Hotel Franchising segment adjusted EBITDA 166 164 629 Segment margin 59% 50% 49% Effect of license fees (3%) (6%) (6%) Effect of marketing, reservatio
Slide 38: Definitions & Disclaimer
38 APPENDIX Definitions & Disclaimer Definitions: Adjusted EBITDA: Represents net income excluding net interest expense, depreciation and amortization, early extinguishment of debt charges, impairment charges, restructuring and related charges, contract termination costs, transaction- related items
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