Accessibility Statement Skip Navigation
  • Resources
  • Investor Relations
  • Journalists
  • Agencies
  • Client Login
  • Send a Release
Return to PR Newswire homepage
  • News
  • Products
  • Contact
Search
When typing in this field, a list of search results will appear and be automatically updated as you type.

Searching for your content...

No results found. Please change your search terms and try again.
  • News Releases view all

    • News in Focus
        • Browse News Releases

        • All News Releases
        • All Public Company
        • English-only
        • News Releases Overview

        • Multimedia Gallery

        • All Multimedia
        • All Photos
        • All Videos
        • Multimedia Gallery Overview

        • Trending Topics

        • All Trending Topics
    • Business & Money
        • Auto & Transportation

        • Aerospace, Defense
        • Air Freight
        • Airlines & Aviation
        • Automotive
        • Maritime & Shipbuilding
        • Railroads and Intermodal Transportation
        • Supply Chain/Logistics
        • Transportation, Trucking & Railroad
        • Travel
        • Trucking and Road Transportation
        • Auto & Transportation Overview

        • View All Auto & Transportation

        • Business Technology

        • Blockchain
        • Broadcast Tech
        • Computer & Electronics
        • Computer Hardware
        • Computer Software
        • Data Analytics
        • Electronic Commerce
        • Electronic Components
        • Electronic Design Automation
        • Financial Technology
        • High Tech Security
        • Internet Technology
        • Nanotechnology
        • Networks
        • Peripherals
        • Semiconductors
        • Business Technology Overview

        • View All Business Technology

        • Entertain­ment & Media

        • Advertising
        • Art
        • Books
        • Entertainment
        • Film and Motion Picture
        • Magazines
        • Music
        • Publishing & Information Services
        • Radio & Podcast
        • Television
        • Entertainment & Media Overview

        • View All Entertain­ment & Media

        • Financial Services & Investing

        • Accounting News & Issues
        • Acquisitions, Mergers and Takeovers
        • Banking & Financial Services
        • Bankruptcy
        • Bond & Stock Ratings
        • Conference Call Announcements
        • Contracts
        • Cryptocurrency
        • Dividends
        • Earnings
        • Earnings Forecasts & Projections
        • Financing Agreements
        • Insurance
        • Investments Opinions
        • Joint Ventures
        • Mutual Funds
        • Private Placement
        • Real Estate
        • Restructuring & Recapitalization
        • Sales Reports
        • Shareholder Activism
        • Shareholder Meetings
        • Stock Offering
        • Stock Split
        • Venture Capital
        • Financial Services & Investing Overview

        • View All Financial Services & Investing

        • General Business

        • Awards
        • Commercial Real Estate
        • Corporate Expansion
        • Earnings
        • Environmental, Social and Governance (ESG)
        • Human Resource & Workforce Management
        • Licensing
        • New Products & Services
        • Obituaries
        • Outsourcing Businesses
        • Overseas Real Estate (non-US)
        • Personnel Announcements
        • Real Estate Transactions
        • Residential Real Estate
        • Small Business Services
        • Socially Responsible Investing
        • Surveys, Polls and Research
        • Trade Show News
        • General Business Overview

        • View All General Business

    • Science & Tech
        • Consumer Technology

        • Artificial Intelligence
        • Blockchain
        • Cloud Computing/Internet of Things
        • Computer Electronics
        • Computer Hardware
        • Computer Software
        • Consumer Electronics
        • Cryptocurrency
        • Data Analytics
        • Electronic Commerce
        • Electronic Gaming
        • Financial Technology
        • Mobile Entertainment
        • Multimedia & Internet
        • Peripherals
        • Social Media
        • STEM (Science, Tech, Engineering, Math)
        • Supply Chain/Logistics
        • Wireless Communications
        • Consumer Technology Overview

        • View All Consumer Technology

        • Energy & Natural Resources

        • Alternative Energies
        • Chemical
        • Electrical Utilities
        • Gas
        • General Manufacturing
        • Mining
        • Mining & Metals
        • Oil & Energy
        • Oil and Gas Discoveries
        • Utilities
        • Water Utilities
        • Energy & Natural Resources Overview

        • View All Energy & Natural Resources

        • Environ­ment

        • Conservation & Recycling
        • Environmental Issues
        • Environmental Policy
        • Environmental Products & Services
        • Green Technology
        • Natural Disasters
        • Environment Overview

        • View All Environ­ment

        • Heavy Industry & Manufacturing

        • Aerospace & Defense
        • Agriculture
        • Chemical
        • Construction & Building
        • General Manufacturing
        • HVAC (Heating, Ventilation and Air-Conditioning)
        • Machinery
        • Machine Tools, Metalworking and Metallurgy
        • Mining
        • Mining & Metals
        • Paper, Forest Products & Containers
        • Precious Metals
        • Textiles
        • Tobacco
        • Heavy Industry & Manufacturing Overview

        • View All Heavy Industry & Manufacturing

        • Telecomm­unications

        • Carriers and Services
        • Mobile Entertainment
        • Networks
        • Peripherals
        • Telecommunications Equipment
        • Telecommunications Industry
        • VoIP (Voice over Internet Protocol)
        • Wireless Communications
        • Telecommunications Overview

        • View All Telecomm­unications

    • Lifestyle & Health
        • Consumer Products & Retail

        • Animals & Pets
        • Beers, Wines and Spirits
        • Beverages
        • Bridal Services
        • Cannabis
        • Cosmetics and Personal Care
        • Fashion
        • Food & Beverages
        • Furniture and Furnishings
        • Home Improvement
        • Household, Consumer & Cosmetics
        • Household Products
        • Jewelry
        • Non-Alcoholic Beverages
        • Office Products
        • Organic Food
        • Product Recalls
        • Restaurants
        • Retail
        • Supermarkets
        • Toys
        • Consumer Products & Retail Overview

        • View All Consumer Products & Retail

        • Entertain­ment & Media

        • Advertising
        • Art
        • Books
        • Entertainment
        • Film and Motion Picture
        • Magazines
        • Music
        • Publishing & Information Services
        • Radio & Podcast
        • Television
        • Entertainment & Media Overview

        • View All Entertain­ment & Media

        • Health

        • Biometrics
        • Biotechnology
        • Clinical Trials & Medical Discoveries
        • Dentistry
        • FDA Approval
        • Fitness/Wellness
        • Health Care & Hospitals
        • Health Insurance
        • Infection Control
        • International Medical Approval
        • Medical Equipment
        • Medical Pharmaceuticals
        • Mental Health
        • Pharmaceuticals
        • Supplementary Medicine
        • Health Overview

        • View All Health

        • Sports

        • General Sports
        • Outdoors, Camping & Hiking
        • Sporting Events
        • Sports Equipment & Accessories
        • Sports Overview

        • View All Sports

        • Travel

        • Amusement Parks and Tourist Attractions
        • Gambling & Casinos
        • Hotels and Resorts
        • Leisure & Tourism
        • Outdoors, Camping & Hiking
        • Passenger Aviation
        • Travel Industry
        • Travel Overview

        • View All Travel

    • Policy & Public Interest
        • Policy & Public Interest

        • Advocacy Group Opinion
        • Animal Welfare
        • Congressional & Presidential Campaigns
        • Corporate Social Responsibility
        • Domestic Policy
        • Economic News, Trends, Analysis
        • Education
        • Environmental
        • European Government
        • FDA Approval
        • Federal and State Legislation
        • Federal Executive Branch & Agency
        • Foreign Policy & International Affairs
        • Homeland Security
        • Labor & Union
        • Legal Issues
        • Natural Disasters
        • Not For Profit
        • Patent Law
        • Public Safety
        • Trade Policy
        • U.S. State Policy
        • Policy & Public Interest Overview

        • View All Policy & Public Interest

    • People & Culture
        • People & Culture

        • Aboriginal, First Nations & Native American
        • African American
        • Asian American
        • Children
        • Diversity, Equity & Inclusion
        • Hispanic
        • Lesbian, Gay & Bisexual
        • Men's Interest
        • People with Disabilities
        • Religion
        • Senior Citizens
        • Veterans
        • Women
        • People & Culture Overview

        • View All People & Culture

    • Explore Our Platform
    • Plan Campaigns
    • Create with AI
    • Distribute Press Releases
    • Report Results
    • Amplify Content
    • All Products
    • General Inquiries
    • Editorial Bureaus
    • Partnerships
    • Media Inquiries
    • Worldwide Offices
    • Hamburger menu
    • PR Newswire: news distribution, targeting and monitoring
    • Send a Release
      • ALL CONTACT INFO
      • Contact Us

        888-776-0942
        from 8 AM - 10 PM ET

    • Searching for your content...

      No results found. Please change your search terms and try again.

      News Releases

      view all
      Close menu
    • News
    • Products
    • Contact
      • Send a Release
      • Client Login
      • Resources
      • Blog
      • Journalists
      • RSS
      • 3 News in Focus
      • 5 Business & Money
      • 5 Science & Tech
      • 5 Lifestyle & Health
      • 1 Policy & Public Interest
      • 1 People & Culture
      • Send a Release
      • Client Login
      • Resources
      • Blog
      • Journalists
      • RSS
      • Explore Our Platform
      • Plan Campaigns
      • Create with AI
      • Distribute Press Releases
      • Report Results
      • Amplify Content
      • All Products
      • Send a Release
      • Client Login
      • Resources
      • Blog
      • Journalists
      • RSS
      • General Inquiries
      • Editorial Bureaus
      • Partnerships
      • Media Inquiries
      • Worldwide Offices
      • Send a Release
      • Client Login
      • Resources
      • Blog
      • Journalists
      • RSS
      Close submenu (News in Focus) News in Focus
      • Browse News Releases
      • Multimedia Gallery
      • Trending Topics
      Close submenu (Business & Money) Business & Money
      • Auto & Transportation
      • Business Technology
      • Entertain­ment & Media
      • Financial Services & Investing
      • General Business
      Close submenu (Science & Tech) Science & Tech
      • Consumer Technology
      • Energy & Natural Resources
      • Environ­ment
      • Heavy Industry & Manufacturing
      • Telecomm­unications
      Close submenu (Lifestyle & Health) Lifestyle & Health
      • Consumer Products & Retail
      • Entertain­ment & Media
      • Health
      • Sports
      • Travel
      Close submenu (Policy & Public Interest) Policy & Public Interest
      • Policy & Public Interest
      Close submenu (People & Culture) People & Culture
      • People & Culture

      Marriott Vacations Worldwide Reports Third Quarter 2013 Financial Results

      Marriott Vacations Worldwide Corporation. (PRNewsFoto/Marriott Vacations Worldwide) (PRNewsFoto/)

      News provided by

      Marriott Vacations Worldwide Corporation

      Oct 10, 2013, 08:00 ET

      Share this article

      Share this article


      ORLANDO, Fla., Oct. 10, 2013 /PRNewswire/ -- Marriott Vacations Worldwide Corporation (NYSE: VAC) today reported third quarter 2013 financial results and provided updated guidance for the full year 2013. In addition, the company announced that its Board of Directors has authorized a share repurchase program under which the company may repurchase up to 3,500,000 shares of its outstanding common stock.

      (Logo: http://photos.prnewswire.com/prnh/20130702/CG40568LOGO)

      Third Quarter 2013 highlights include:

      • Adjusted EBITDA (earnings before interest expense (excluding consumer financing interest expense), income taxes, depreciation and amortization, as adjusted for organizational and separation related costs in connection with the company's spin-off from Marriott International, Inc. (the "Spin-Off") and other activity) totaled $50 million, a $17 million increase from the third quarter of 2012.
      • Company and North America adjusted development margin was 20.3 percent and 22.2 percent, respectively.
      • North America volume per guest (VPG) increased 6.6 percent year-over-year to $3,252.
      • Adjusted fully diluted earnings per share (EPS) in the third quarter were $0.72 compared to $0.23 in the third quarter of 2012.
      • The company completed a securitization of $263 million of vacation ownership notes receivable at a blended borrowing rate of 2.21 percent.
      • The company disposed of $7 million of excess built residential inventory in its North America segment.

      Third quarter 2013 net income totaled $25 million, or $0.67 per diluted share, compared to net income of $5 million, or $0.12 per diluted share, in the third quarter of 2012. Company development margin increased to 21.1 percent in the third quarter of 2013 from 15.6 percent in the third quarter of 2012; North America development margin for the third quarter increased to 22.7 percent from 19.2 percent year over year.

      Third quarter 2013 adjusted net income totaled $27 million, a $19 million increase from $8 million of adjusted net income in the third quarter of 2012. Third quarter 2013 adjusted net income reflects a $3 million increase in pre-tax income that resulted from the exclusion of $4 million of organizational and separation related costs, partially offset by the exclusion of $1 million of pre-tax income related to the impact of extended rescission periods in the company's Europe segment. Third quarter 2012 adjusted net income reflects a $5 million increase to pre-tax income that resulted from the exclusion of $3 million of organizational and separation related costs and the inclusion of $2 million of pre-tax income related to the impact of extended rescission periods in the company's Europe segment. In addition, adjusted development margin for both periods is adjusted, as appropriate, for the impact of revenue reportability.

      Non-GAAP financial measures, such as adjusted EBITDA, adjusted net income and adjusted development margin, are reconciled in the Press Release Schedules that follow. Adjustments are shown and described in further detail on schedules A-1 through A-20. The company now reports consumer financing interest expense separately from all other interest expense. As a result, adjusted EBITDA as used in this release is equivalent to the non-GAAP financial measure adjusted EBITDA, as adjusted, reported in prior releases.

      "Our third quarter results demonstrate strong execution across our business. Adjusted EBITDA increased over 50 percent year over year, driven by VPG growth and solid development margin performance, as well as stronger results from our rental and resort management businesses," said Stephen P. Weisz, president and chief executive officer. "Based on our year-to-date performance and our outlook for the fourth quarter, we are increasing our full year adjusted development margin, free cash flow and EBITDA guidance."

      Weisz concluded, "Given our confidence in our long-term growth outlook and cash flow generation potential, our Board of Directors approved a share repurchase program reflecting our commitment to return cash to shareholders and increase overall shareholder returns."

      Third Quarter 2013 Results

      Total company contract sales were $168 million, a $3 million decrease from $171 million in the third quarter of 2012, driven mainly by $10 million of higher contract sales in the company's North America segment, offset by $13 million of lower contract sales in the company's Europe and Asia Pacific segments.

      For the third quarter ended September 6, 2013, total revenues from the sale of vacation ownership products were $162 million, an increase of $19 million over the prior year period. 

      Reported development margin was $34 million, a $12 million increase from the third quarter of 2012. Adjusted development margin was $32 million, a $1 million decrease from the third quarter of 2012. Reported development margin increased 5.5 percentage points to 21.1 percent in the third quarter of 2013 from 15.6 percent in the third quarter of 2012. Adjusted development margin percentage decreased 0.6 percentage points to 20.3 percent in the third quarter of 2013 from 20.9 percent in the third quarter of 2012. The adjustments are illustrated on schedule A-10.

      Rental revenues totaled $65 million, an $8 million, or 17 percent, increase from the third quarter of 2012. These results reflect an 11 percent increase in transient keys rented as well as a 10 percent increase in average transient rate driven by stronger consumer demand and a favorable mix of available rental inventory. Rental revenues, net of expenses, were $8 million, $9 million higher than the third quarter of 2012.

      Resort management and other services revenues totaled $62 million, a $2 million increase from the third quarter of 2012. Resort management and other services revenues, net of expenses were $17 million, a $4 million increase over the third quarter of 2012. Results reflected higher annual fees in connection with the company's Marriott Vacation Club Destinations program and improvements in ancillary operations driven by the disposition of a golf course and related assets at one of the company's Ritz-Carlton branded resorts late in 2012.

      Adjusted EBITDA was $50 million in the third quarter of 2013, a $17 million increase from $33 million in the third quarter of 2012.

      Segment Results

      Effective December 29, 2012, the company combined the reporting of the financial results of its former Luxury segment with its North America segment based upon its decision to scale back separate development activity and to aggregate future marketing and sales of inventory in the upscale and luxury tiers. Existing service standards and on-site management remain unaffected by these reporting changes. Prior year amounts have been recast for consistency with current year's presentation.

      North America

      VPG increased 6.6 percent to $3,252 in the third quarter of 2013 from $3,051 in the third quarter of 2012, driven by higher pricing and improved closing efficiency. Total North America contract sales were $152 million in the third quarter of 2013, an increase of $10 million over the prior year period. Contract sales in the quarter included $7 million related to the disposition of excess built residential inventory primarily at a project in Florida.

      Third quarter 2013 North America segment financial results increased 32 percent, or $21 million, to $87 million. The increase was primarily driven by $10 million of higher rental revenues net of expenses, $9 million of higher development margin and approximately $4 million of higher resort management and other services revenues net of expenses. These increases were partially offset by $3 million of lower financing revenues.

      Revenues from the sale of vacation ownership products increased $23 million to $145 million in the third quarter, resulting from $15 million of higher year-over-year revenue reportability and $10 million of higher contract sales. Development margin was $33 million, a $9 million increase from the third quarter of 2012. This was driven by the impact of higher revenue reportability and lower marketing and sales expenses, offset partially by higher cost of vacation ownership products in the current quarter from the impact of the residential sales, as well as lower cost of vacation ownership products in the prior year quarter from favorable product cost true-up activity.  

      Excluding the impact of revenue reportability, adjusted development margin was $32 million, a $1 million increase from the prior year quarter. Adjusted development margin percentage decreased to 22.2 percent in the third quarter of 2013 from 22.8 percent in the third quarter of 2012. Reported development margin percentage increased to 22.7 percent in the third quarter of 2013 as compared to 19.2 percent in the prior year quarter. The impact of revenue reportability is illustrated on schedule A-12.

      Asia Pacific

      Asia Pacific contract sales declined $8 million to $7 million in the third quarter of 2013 and total revenues declined $7 million to $13 million, reflecting the impact of the closure of two under-performing off-site sales centers in the fourth quarter of 2012. Segment financial results were break-even, $1 million lower than the third quarter of 2012.

      Europe

      Third quarter 2013 contract sales declined $5 million to $9 million as the Europe segment continued to sell through its remaining inventory. Europe adjusted segment financial results were $6 million, in line with the third quarter of 2012. Reported segment financial results were $7 million, up $3 million from the third quarter of 2012.

      Organizational and Separation Plan

      During the third quarter of 2013, the company incurred $6 million of costs in connection with its continued organizational and separation related efforts, of which approximately $2 million was capitalized during the quarter. Total future spending for these efforts is expected to be approximately $10 million to $15 million, with costs being incurred through 2014.

      These costs primarily relate to establishing the company's own information technology systems and services, independent accounts payable functions and reorganization of existing human resources and information technology organizations to support the company's standalone public company needs. Once completed, these efforts are expected to generate approximately $15 million to $20 million of annualized savings, of which approximately $8 million has been realized to date, including $3 million reflected in the company's year-to-date 2013 financial results.

      Share Repurchase Program

      On October 8, 2013, the company's Board of Directors authorized a share repurchase program under which the company may purchase up to 3,500,000 shares of its common stock prior to March 28, 2015. The specific timing, amount and other terms of the repurchases will depend on market conditions, corporate and regulatory requirements and other factors. In connection with the repurchase program, the company may adopt one or more plans pursuant to the provisions of Rule 10b5-1 under the Securities and Exchange Act of 1934.

      Balance Sheet and Liquidity

      On September 6, 2013, cash and cash equivalents totaled $288 million. Since the end of 2012, real estate inventory balances declined $28 million to $853 million, including $390 million of finished goods, $193 million of work-in-process and $270 million of land and infrastructure. The company had $751 million in debt outstanding at the end of the third quarter of 2013, an increase of $73 million from year-end 2012, including $747 million in non-recourse securitized notes. In addition, $40 million of mandatorily redeemable preferred stock of a subsidiary of the company was outstanding at the end of the third quarter of 2013.

      In August the company completed a securitization of $263 million of vacation ownership loans at a weighted average interest rate of 2.21 percent and an advance rate of 95 percent. This transaction generated approximately $250 million of gross cash proceeds. Net cash proceeds to the company after transaction costs, cash reserves and repayment of amounts outstanding under the company's warehouse credit facility were $148 million, which are available for general corporate purposes.

      As of September 6, 2013, the company had $196 million in available capacity under its revolving credit facility after taking into account outstanding letters of credit and had $17 million of vacation ownership notes receivable eligible for securitization.

      Outlook

      For the full year 2013, the company is updating its guidance as reflected in the chart below. The earnings per share and cash flow guidance do not reflect the impact of any stock repurchases that may be made under the company's share repurchase program.


      Current Guidance

      Previous Guidance

      Adjusted EBITDA

      $165 million to $175 million

      $155 million to $165 million

      Adjusted net income

      $81 million to $87 million

      $72 million to $78 million

      Adjusted fully diluted earnings per share

      $2.21 to $2.37

      $1.94 to $2.10

      Adjusted company development margin

      18.0 percent to 19.0 percent

      17.0 percent to 18.0 percent

      Adjusted free cash flow, as adjusted

      $170 million to $185 million

      $120 million to $135 million

      Company contract sales growth

      (1) percent to 3 percent

      0 percent to 5 percent

      North America contract sales growth

      4 percent to 8 percent

      5 percent to 10 percent

      Schedules A-1 through A-20 reconcile the non-GAAP financial measures set forth above to the company's expected full year 2013 reported net income of $80 million to $86 million and reported development margin of 19.0 percent to 20.0 percent.

      Third Quarter 2013 Earnings Conference Call

      The company will hold a conference call at 10:00 a.m. EDT today to discuss these results. Participants may access the call by dialing (800) 762-8779 or (480) 629-9645 for international callers. A live webcast of the call will also be available in the Investor Relations section of the company's website at www.marriottvacationsworldwide.com.

      An audio replay of the conference call will be available for seven days and can be accessed at (800) 406-7325 or (303) 590-3030 for international callers. The replay passcode is 4641471. The webcast will also be available on the company's website.

      About Marriott Vacations Worldwide Corporation
      Marriott Vacations Worldwide Corporation is a leading global pure-play vacation ownership company. In late 2011, Marriott Vacations Worldwide was established as an independent, public company focusing primarily on vacation ownership experiences. Since entering the industry in 1984 as part of Marriott International, Inc., the company earned its position as a leader and innovator in vacation ownership products. The company preserves high standards of excellence in serving its customers, investors and associates while maintaining a long-term relationship with Marriott International. Marriott Vacations Worldwide offers a diverse portfolio of quality products, programs and management expertise with more than 60 resorts and more than 420,000 Owners and Members. Its brands include: Marriott Vacation Club, The Ritz-Carlton Destination Club and Grand Residences by Marriott. For more information, please visit www.marriottvacationsworldwide.com.

      Note on forward-looking statements: This press release and accompanying schedules contain "forward-looking statements" within the meaning of federal securities laws, including statements about earnings trends, organizational and separation related efforts, estimates, and assumptions, and similar statements concerning anticipated future events and expectations that are not historical facts. We caution you that these statements are not guarantees of future performance and are subject to numerous risks and uncertainties, including volatility in the economy and the credit markets, supply and demand changes for vacation ownership and residential products, competitive conditions; the availability of capital to finance growth, and other matters referred to under the heading "Risk Factors" contained in our most recent Annual Report on Form 10-K filed with the U.S Securities and Exchange Commission (the "SEC") and in subsequent SEC filings, any of which could cause actual results to differ materially from those expressed in or implied in this presentation. These statements are made as of October 10, 2013 and we undertake no obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future events, or otherwise.

      Press Release Schedules Follow

      MARRIOTT VACATIONS WORLDWIDE CORPORATION

      PRESS RELEASE SCHEDULES

      QUARTER 3, 2013

      TABLE OF CONTENTS

































      Consolidated Statements of Operations - 12 Weeks Ended September 6, 2013 and September 7, 2012

      A-1

















      Consolidated Statements of Operations - 36 Weeks Ended September 6, 2013 and September 7, 2012

      A-2

















      North America Segment Financial Results - 12 Weeks Ended September 6, 2013 and September 7, 2012

      A-3

















      North America Segment Financial Results - 36 Weeks Ended September 6, 2013 and September 7, 2012

      A-4

















      Asia Pacific Segment Financial Results - 12 Weeks Ended September 6, 2013 and September 7, 2012

      A-5

















      Asia Pacific Segment Financial Results - 36 Weeks Ended September 6, 2013 and September 7, 2012

      A-6

















      Europe Segment Financial Results - 12 Weeks Ended September 6, 2013 and September 7, 2012

      A-7

















      Europe Segment Financial Results - 36 Weeks Ended September 6, 2013 and September 7, 2012

      A-8

















      Corporate and Other Financial Results - 12 Weeks and 36 Weeks Ended September 6, 2013 and September 7, 2012

      A-9

















      Consolidated Contract Sales to Sale of Vacation Ownership Products and Adjusted Development Margin


          (Adjusted Sale of Vacation Ownership Products Net of Expenses) - 12 Weeks Ended September 6, 2013 and September 7, 2012

      A-10

















      Consolidated Contract Sales to Sale of Vacation Ownership Products and Adjusted Development Margin


          (Adjusted Sale of Vacation Ownership Products Net of Expenses) - 36 Weeks Ended September 6, 2013 and September 7, 2012

      A-11

















      North America Contract Sales to Sale of Vacation Ownership Products and Adjusted Development Margin


          (Adjusted Sale of Vacation Ownership Products Net of Expenses) - 12 Weeks Ended September 6, 2013 and September 7, 2012

      A-12

















      North America Contract Sales to Sale of Vacation Ownership Products and Adjusted Development Margin


          (Adjusted Sale of Vacation Ownership Products Net of Expenses) - 36 Weeks Ended September 6, 2013 and September 7, 2012

      A-13

















      EBITDA and Adjusted EBITDA - 12 Weeks and 36 Weeks Ended September 6, 2013 and September 7, 2012

      A-14

















      Adjusted Net Income and Adjusted Earnings Per Share - Diluted, Adjusted EBITDA and Adjusted Development Margin - 2013 Outlook

      A-15

















      2013 Adjusted Free Cash Flow Outlook

      A-16

















      2013 Normalized Adjusted Free Cash Flow Outlook





      A-17

















      Non-GAAP Financial Measures


      A-18

















      Interim Consolidated Balance Sheets

      A-21

















      Interim Consolidated Statements of Cash Flows

      A-22


      A-1

      MARRIOTT VACATIONS WORLDWIDE CORPORATION

      CONSOLIDATED STATEMENTS OF OPERATIONS

      12 Weeks Ended September 6, 2013 and September 7, 2012

      (In millions, except per share amounts)


































      As Reported




      Europe


      As Adjusted



      As Reported




      Europe


      As Adjusted










      12 Weeks Ended


      Certain


      Rescission


      12 Weeks Ended



      12 Weeks Ended


      Certain


      Rescission


      12 Weeks Ended










      September 6, 2013


      Charges


      Adjustment


      September 6, 2013

      **


      September 7, 2012


      Charges


      Adjustment


      September 7, 2012

      **

      Revenues






















      Sale of vacation ownership products

      $                        162


      $           -


      $               (2)


      $                     160



      $                        143


      $           -


      $                3


      $                        146



      Resort management and other services

      62


      -


      -


      62



      60


      -


      -


      60



      Financing

      32


      -


      -


      32



      35


      -


      -


      35



      Rental

      65


      -


      -


      65



      57


      -


      -


      57



      Other


      7


      -


      -


      7



      7


      -


      -


      7



      Cost reimbursements

      84


      -


      -


      84



      81


      -


      -


      81







      Total revenues

      412


      -


      (2)


      410



      383


      -


      3


      386


      Expenses






















      Cost of vacation ownership products

      56


      -


      (1)


      55



      42


      -


      -


      42



      Marketing and sales

      72


      -


      -


      72



      79


      -


      1


      80



      Resort management and other services

      45


      -


      -


      45



      47


      -


      -


      47



      Financing

      5


      -


      -


      5



      5


      -


      -


      5



      Rental

      57


      -


      -


      57



      58


      -


      -


      58



      Other


      4


      -


      -


      4



      3


      -


      -


      3



      General and administrative

      23


      -


      -


      23



      20


      -


      -


      20



      Organizational and separation related


      4


      (4)


      -


      -



      3


      (3)


      -


      -



      Consumer financing interest


      7


      -


      -


      7



      10


      -


      -


      10



      Royalty fee

      13


      -


      -


      13



      14


      -


      -


      14



      Cost reimbursements

      84


      -


      -


      84



      81


      -


      -


      81







      Total expenses

      370


      (4)


      (1)


      365



      362


      (3)


      1


      360


      Interest expense


      2


      -


      -


      2



      5


      -


      -


      5


      Impairment reversals on equity investment

      -


      -


      -


      -



      -


      -


      -


      -







      Income before income taxes

      40


      4


      (1)


      43



      16


      3


      2


      21


      Provision for income taxes

      (15)


      (1)


      -


      (16)



      (11)


      (1)


      (1)


      (13)


      Net income


      $                          25


      $          3


      $               (1)


      $                       27



      $                            5


      $          2


      $                1


      $                            8



























      Earnings per share - Basic


      $                       0.70






      $                    0.74



      $                       0.13






      $                       0.24



























      Earnings per share - Diluted


      $                       0.67






      $                    0.72



      $                       0.12






      $                       0.23



























      Basic Shares



      35.5






      35.5



      34.4






      34.4


      Diluted Shares


      36.7






      36.7



      36.2






      36.2



































      As Reported









      As Reported
















      12 Weeks Ended









      12 Weeks Ended
















      September 6, 2013









      September 7, 2012








      Contract Sales





















      Vacation ownership


      $                        161









      $                        171










      Residential products


      7









      -












      Total contract sales


      $                        168









      $                        171


























































      ** Denotes non-GAAP financial measures. Please see schedules A-18 through A-20 for additional information about our reasons for providing these alternative financial measures and limitations on their use.


      NOTE:

      We have restated 2012 Sale of vacation ownership products and Cost reimbursements revenues, Cost of vacation ownership products, Marketing and sales and Cost reimbursements expenses, Income before income taxes, Provision for income taxes, Net income, Earnings per share - Basic, and Earnings per share - Diluted to correct prior period misstatements. Earnings per share - Basic and Earnings per share - Diluted are calculated using whole dollars.


      A-2

      MARRIOTT VACATIONS WORLDWIDE CORPORATION

      CONSOLIDATED STATEMENTS OF OPERATIONS

      36 Weeks Ended September 6, 2013 and September 7, 2012

      (In millions, except per share amounts)


































      As Reported




      Europe


      As Adjusted



      As Reported




      Europe


      As Adjusted










      36 Weeks Ended


      Certain


      Rescission


      36 Weeks Ended



      36 Weeks Ended


      Certain


      Rescission


      36 Weeks Ended










      September 6, 2013


      Charges


      Adjustment


      September 6, 2013

      **


      September 7, 2012


      Charges


      Adjustment


      September 7, 2012

      **

      Revenues






















      Sale of vacation ownership products

      $                        472


      $           -


      $             (20)


      $                        452



      $                        416


      $           -


      $                9


      $                        425



      Resort management and other services

      179


      -


      -


      179



      176


      -


      -


      176



      Financing

      97


      -


      -


      97



      106


      -


      -


      106



      Rental

      193


      -


      -


      193



      167


      -


      -


      167



      Other


      22


      -


      -


      22



      21


      -


      -


      21



      Cost reimbursements

      260


      -


      -


      260



      254


      -


      -


      254







      Total revenues

      1,223


      -


      (20)


      1,203



      1,140


      -


      9


      1,149


      Expenses






















      Cost of vacation ownership products

      157


      -


      (7)


      150



      139


      -


      2


      141



      Marketing and sales

      220


      (2)


      (2)


      216



      231


      (1)


      1


      231



      Resort management and other services

      132


      -


      -


      132



      140


      -


      -


      140



      Financing

      16


      -


      -


      16



      18


      -


      -


      18



      Rental

      169


      -


      -


      169



      158


      -


      -


      158



      Other


      11


      -


      -


      11



      8


      -


      -


      8



      General and administrative

      66


      -


      -


      66



      59


      -


      -


      59



      Organizational and separation related


      7


      (7)


      -


      -



      9


      (9)


      -


      -



      Litigation settlement


      (1)


      1


      -


      -



      2


      (2)


      -


      -



      Consumer financing interest


      22


      -


      -


      22



      30


      -


      -


      30



      Royalty fee

      41


      -


      -


      41



      41


      -


      -


      41



      Impairment

      1


      (1)


      -


      -



      -


      -


      -


      -



      Cost reimbursements

      260


      -


      -


      260



      254


      -


      -


      254







      Total expenses

      1,101


      (9)


      (9)


      1,083



      1,089


      (12)


      3


      1,080


      Gains and other income

      1


      -


      -


      1



      -


      -


      -


      -


      Interest expense


      9


      -


      -


      9



      12


      -


      -


      12


      Impairment reversals on equity investment

      -


      -


      -


      -



      2


      (2)


      -


      -







      Income before income taxes

      114


      9


      (11)


      112



      41


      10


      6


      57


      Provision for income taxes

      (40)


      (2)


      3


      (39)



      (23)


      (4)


      (1)


      (28)


      Net income


      $                          74


      $          7


      $               (8)


      $                          73



      $                          18


      $          6


      $                5


      $                          29



























      Earnings per share - Basic


      $                       2.10






      $                       2.06



      $                       0.52






      $                       0.87



























      Earnings per share - Diluted


      $                       2.03






      $                       1.99



      $                       0.50






      $                       0.82



























      Basic Shares



      35.4






      35.4



      34.2






      34.2


      Diluted Shares


      36.6






      36.6



      36.0






      36.0



































      As Reported









      As Reported
















      36 Weeks Ended









      36 Weeks Ended
















      September 6, 2013









      September 7, 2012








      Contract Sales





















      Vacation ownership


      $                        473









      $                        493










      Residential products


      8









      -












      Total contract sales


      $                        481









      $                        493


























































      ** Denotes non-GAAP financial measures. Please see schedules A-18 through A-20 for additional information about our reasons for providing these alternative financial measures and limitations on their use.


      NOTE:

      We have restated 2012 Sale of vacation ownership products and Cost reimbursements revenues, Cost of vacation ownership products, Marketing and sales and Cost reimbursements expenses, Income before income taxes, Provision for income taxes, Net income, Earnings per share - Basic, and Earnings per share - Diluted to correct prior period misstatements. Earnings per share - Basic and Earnings per share - Diluted are calculated using whole dollars.


      A-3

      MARRIOTT VACATIONS WORLDWIDE CORPORATION

      NORTH AMERICA SEGMENT

      12 Weeks Ended September 6, 2013 and September 7, 2012

      ($ in millions)



















































      As Reported




      As Adjusted



      As Reported




      As Adjusted










      12 Weeks Ended


      Certain


      12 Weeks Ended



      12 Weeks Ended


      Certain


      12 Weeks Ended










      September 6, 2013


      Charges


      September 6, 2013

      **


      September 7, 2012


      Charges


      September 7, 2012

      **

      Revenues


















      Sale of vacation ownership products

      $                        145


      $           -


      $                        145



      $                        122


      $           -


      $                        122



      Resort management and other services

      53


      -


      53



      51


      -


      51



      Financing

      30


      -


      30



      33


      -


      33



      Rental

      56


      -


      56



      47


      -


      47



      Other

      6


      -


      6



      6


      -


      6



      Cost reimbursements

      75


      -


      75



      73


      -


      73







      Total revenues

      365


      -


      365



      332


      -


      332


      Expenses


















      Cost of vacation ownership products

      51


      -


      51



      36


      -


      36



      Marketing and sales

      61


      -


      61



      62


      -


      62



      Resort management and other services

      37


      -


      37



      39


      -


      39



      Rental

      49


      -


      49



      50


      -


      50



      Other

      3


      -


      3



      2


      -


      2



      Organizational and separation related

      -


      -


      -



      1


      (1)


      -



      Royalty fee

      2


      -


      2



      3


      -


      3



      Cost reimbursements

      75


      -


      75



      73


      -


      73







      Total expenses

      278


      -


      278



      266


      (1)


      265







      Segment financial results

      $                          87


      $           -


      $                          87



      $                          66


      $          1


      $                          67































      As Reported







      As Reported














      12 Weeks Ended







      12 Weeks Ended














      September 6, 2013







      September 7, 2012






      Contract Sales

















      Vacation ownership


      $                        145







      $                       142








      Residential products

      7







      -










      Total contract sales


      $                        152







      $                       142
















































      ** Denotes non-GAAP financial measures. Please see schedules A-18 through A-20 for additional information about our reasons for providing these alternative financial measures and limitations on their use.























      NOTE:

      We combined the financial results of the former Luxury segment with the North America segment beginning with the first quarter of 2013 and have recast prior year presentation for consistency. As a result of a realignment of our management structure, beginning with the first quarter of 2013 we no longer allocate certain general and administrative expenses to our reportable segments. Prior year reportable segment information has been adjusted to reflect this change. We have restated 2012 Cost reimbursements revenues and expenses to correct a prior period misstatement.


      A-4

      MARRIOTT VACATIONS WORLDWIDE CORPORATION

      NORTH AMERICA SEGMENT

      36 Weeks Ended September 6, 2013 and September 7, 2012

      ($ in millions)



















































      As Reported




      As Adjusted



      As Reported




      As Adjusted










      36 Weeks Ended


      Certain


      36 Weeks Ended



      36 Weeks Ended


      Certain


      36 Weeks Ended










      September 6, 2013


      Charges


      September 6, 2013

      **


      September 7, 2012


      Charges


      September 7, 2012

      **

      Revenues


















      Sale of vacation ownership products

      $                        407


      $           -


      $                        407



      $                        359


      $           -


      $                        359



      Resort management and other services

      155


      -


      155



      153


      -


      153



      Financing

      91


      -


      91



      100


      -


      100



      Rental

      172


      -


      172



      147


      -


      147



      Other


      21


      -


      21



      20


      -


      20



      Cost reimbursements

      231


      -


      231



      228


      -


      228







      Total revenues

      1,077


      -


      1,077



      1,007


      -


      1,007


      Expenses


















      Cost of vacation ownership products

      137


      -


      137



      121


      -


      121



      Marketing and sales

      187


      -


      187



      183


      (1)


      182



      Resort management and other services

      111


      -


      111



      120


      -


      120



      Rental

      148


      -


      148



      138


      -


      138



      Other


      10


      -


      10



      7


      -


      7



      Organizational and separation related


      -


      -


      -



      1


      (1)


      -



      Litigation settlement


      (1)


      1


      -



      2


      (2)


      -



      Royalty fee

      6


      -


      6



      6


      -


      6



      Cost reimbursements

      231


      -


      231



      228


      -


      228







      Total expenses

      829


      1


      830



      806


      (4)


      802


      Gains and other income

      1


      -


      1



      -


      -


      -


      Impairment reversals on equity investment

      -


      -


      -



      2


      (2)


      -







      Segment financial results


      $                        249


      $         (1)


      $                        248



      $                        203


      $          2


      $                        205































      As Reported







      As Reported














      36 Weeks Ended







      36 Weeks Ended














      September 6, 2013







      September 7, 2012






      Contract Sales

















      Vacation ownership


      $                       429







      $                        419








      Residential products


      8







      -










      Total contract sales


      $                       437







      $                        419
















































      ** Denotes non-GAAP financial measures. Please see schedules A-18 through A-20 for additional information about our reasons for providing these alternative financial measures and limitations on their use.


      NOTE:

      We combined the financial results of the former Luxury segment with the North America segment beginning with the first quarter of 2013 and have recast prior year presentation for consistency. As a result of a realignment of our management structure, beginning with the first quarter of 2013 we no longer allocate certain general and administrative expenses to our reportable segments. Prior year reportable segment information has been adjusted to reflect this change. We have restated 2012 Cost reimbursements revenues and expenses to correct a prior period misstatement.


      A-5

      MARRIOTT VACATIONS WORLDWIDE CORPORATION

      ASIA PACIFIC SEGMENT

      12 Weeks Ended September 6, 2013 and September 7, 2012

      ($ in millions)



















































      As Reported




      As Adjusted



      As Reported




      As Adjusted










      12 Weeks Ended


      Certain


      12 Weeks Ended



      12 Weeks Ended


      Certain


      12 Weeks Ended










      September 6, 2013


      Charges


      September 6, 2013

      **


      September 7, 2012


      Charges


      September 7, 2012

      **

      Revenues


















      Sale of vacation ownership products

      $                             7


      $            -


      $                             7



      $                           14


      $            -


      $                           14



      Resort management and other services

      1


      -


      1



      1


      -


      1



      Financing

      1


      -


      1



      1


      -


      1



      Rental

      1


      -


      1



      2


      -


      2



      Cost reimbursements

      3


      -


      3



      2


      -


      2







      Total revenues

      13


      -


      13



      20


      -


      20


      Expenses


















      Cost of vacation ownership products

      1


      -


      1



      3


      -


      3



      Marketing and sales

      5


      -


      5



      10


      -


      10



      Resort management and other services

      1


      -


      1



      1


      -


      1



      Rental

      3


      -


      3



      3


      -


      3



      Cost reimbursements

      3


      -


      3



      2


      -


      2







      Total expenses

      13


      -


      13



      19


      -


      19







      Segment financial results

      $                              -


      $            -


      $                             -



      $                             1


      $            -


      $                             1




















































      As Reported







      As Reported














      12 Weeks Ended







      12 Weeks Ended














      September 6, 2013







      September 7, 2012



























      Contract Sales


      $                           7







      $                         15
















































      ** Denotes non-GAAP financial measures. Please see schedules A-18 through A-20 for additional information about our reasons for providing these alternative financial measures and limitations on their use.


      NOTE:

      As a result of a realignment of our management structure, beginning with the first quarter of 2013 we no longer allocate certain general and administrative expenses to our reportable segments.Prior year reportable segment information has been adjusted to reflect this change. We have restated 2012 Cost reimbursements revenues and expenses to correct a prior period misstatement.


      A-6

      MARRIOTT VACATIONS WORLDWIDE CORPORATION

      ASIA PACIFIC SEGMENT

      36 Weeks Ended September 6, 2013 and September 7, 2012

      ($ in millions)



















































      As Reported




      As Adjusted



      As Reported




      As Adjusted










      36 Weeks Ended


      Certain


      36 Weeks Ended



      36 Weeks Ended


      Certain


      36 Weeks Ended










      September 6, 2013


      Charges


      September 6, 2013

      **


      September 7, 2012


      Charges


      September 7, 2012

      **

      Revenues


















      Sale of vacation ownership products

      $                           23


      $            -


      $                           23



      $                           40


      $            -


      $                           40



      Resort management and other services

      3


      -


      3



      3


      -


      3



      Financing

      3


      -


      3



      3


      -


      3



      Rental

      5


      -


      5



      5


      -


      5



      Cost reimbursements

      10


      -


      10



      8


      -


      8







      Total revenues

      44


      -


      44



      59


      -


      59


      Expenses


















      Cost of vacation ownership products

      4


      -


      4



      9


      -


      9



      Marketing and sales

      14


      -


      14



      28


      -


      28



      Resort management and other services

      2


      -


      2



      2


      -


      2



      Rental

      8


      -


      8



      7


      -


      7



      Royalty fee

      1


      -


      1



      1


      -


      1



      Cost reimbursements

      10


      -


      10



      8


      -


      8







      Total expenses

      39


      -


      39



      55


      -


      55







      Segment financial results

      $                             5


      $            -


      $                             5



      $                             4


      $            -


      $                             4




















































      As Reported







      As Reported














      36 Weeks Ended







      36 Weeks Ended














      September 6, 2013







      September 7, 2012



























      Contract Sales


      $                           24







      $                           43
















































      ** Denotes non-GAAP financial measures. Please see schedules A-18 through A-20 for additional information about our reasons for providing these alternative financial measures and limitations on their use.


      NOTE:

      As a result of a realignment of our management structure, beginning with the first quarter of 2013 we no longer allocate certain general and administrative expenses to our reportable segments. Prior year reportable segment information has been adjusted to reflect this change. We have restated 2012 Cost reimbursements revenues and expenses to correct a prior period misstatement.


      A-7

      MARRIOTT VACATIONS WORLDWIDE CORPORATION

      EUROPE SEGMENT

      12 Weeks Ended September 6, 2013 and September 7, 2012

      ($ in millions)



























































      As Reported




      Europe


      As Adjusted



      As Reported




      Europe


      As Adjusted










      12 Weeks Ended


      Certain


      Rescission


      12 Weeks Ended



      12 Weeks Ended


      Certain


      Rescission


      12 Weeks Ended










      September 6, 2013


      Charges


      Adjustment


      September 6, 2013

      **


      September 7, 2012


      Charges


      Adjustment


      September 7, 2012

      **

      Revenues






















      Sale of vacation ownership products

      $                          10


      $           -


      $               (2)


      $                            8



      $                            7


      $           -


      $                3


      $                          10



      Resort management and other services

      8


      -


      -


      8



      8


      -


      -


      8



      Financing

      1


      -


      -


      1



      1


      -


      -


      1



      Rental

      8


      -


      -


      8



      8


      -


      -


      8



      Other

      1


      -


      -


      1



      1


      -


      -


      1



      Cost reimbursements

      6


      -


      -


      6



      6


      -


      -


      6







      Total revenues

      34


      -


      (2)


      32



      31


      -


      3


      34


      Expenses






















      Cost of vacation ownership products

      2


      -


      (1)


      1



      1


      -


      -


      1



      Marketing and sales

      6


      -


      -


      6



      7


      -


      1


      8



      Resort management and other services

      7


      -


      -


      7



      7


      -


      -


      7



      Rental

      5


      -


      -


      5



      5


      -


      -


      5



      Other

      1


      -


      -


      1



      1


      -


      -


      1



      Cost reimbursements

      6


      -


      -


      6



      6


      -


      -


      6







      Total expenses

      27


      -


      (1)


      26



      27


      -


      1


      28







      Segment financial results

      $                            7


      $           -


      $               (1)


      $                            6



      $                            4


      $           -


      $                2


      $                            6




























































      As Reported









      As Reported
















      12 Weeks Ended









      12 Weeks Ended
















      September 6, 2013









      September 7, 2012

































      Contract Sales


      $                           9









      $                          14


























































      ** Denotes non-GAAP financial measures. Please see schedules A-18 through A-20 for additional information about our reasons for providing these alternative financial measures and limitations on their use.



      NOTE:

      As a result of a realignment of our management structure, beginning with the first quarter of 2013 we no longer allocate certain general and administrative expenses to our reportable segments. Prior year reportable segment information has been adjusted to reflect this change. We have restated 2012 Sale of vacation ownership products and Cost reimbursements revenues, Cost of vacation ownership products, Marketing and sales and Cost reimbursements expenses, and Segment financial results to correct prior period misstatements.


      A-8

      MARRIOTT VACATIONS WORLDWIDE CORPORATION

      EUROPE SEGMENT

      36 Weeks Ended September 6, 2013 and September 7, 2012

      ($ in millions)



























































      As Reported




      Europe


      As Adjusted



      As Reported




      Europe


      As Adjusted










      36 Weeks Ended


      Certain


      Rescission


      36 Weeks Ended



      36 Weeks Ended


      Certain


      Rescission


      36 Weeks Ended










      September 6, 2013


      Charges


      Adjustment


      September 6, 2013

      **


      September 7, 2012


      Charges


      Adjustment


      September 7, 2012

      **

      Revenues






















      Sale of vacation ownership products

      $                          42


      $           -


      $             (20)


      $                          22



      $                          17


      $           -


      $                9


      $                          26



      Resort management and other services

      21


      -


      -


      21



      20


      -


      -


      20



      Financing

      3


      -


      -


      3



      3


      -


      -


      3



      Rental

      16


      -


      -


      16



      15


      -


      -


      15



      Other

      1


      -


      -


      1



      1


      -


      -


      1



      Cost reimbursements

      19


      -


      -


      19



      18


      -


      -


      18







      Total revenues

      102


      -


      (20)


      82



      74


      -


      9


      83


      Expenses






















      Cost of vacation ownership products

      11


      -


      (7)


      $ 4



      4


      -


      2


      $ 6



      Marketing and sales

      19


      (2)


      (2)


      15



      20


      -


      1


      21



      Resort management and other services

      19


      -


      -


      19



      18


      -


      -


      18



      Rental

      13


      -


      -


      13



      13


      -


      -


      13



      Other

      1


      -


      -


      1



      1


      -


      -


      1



      Impairment

      1


      (1)


      -


      -



      -


      -


      -


      -



      Cost reimbursements

      19


      -


      -


      19



      18


      -


      -


      18







      Total expenses

      83


      (3)


      (9)


      71



      74


      -


      3


      77







      Segment financial results

      $                          19


      $          3


      $             (11)


      $                          11



      $                             -


      $           -


      $                6


      $                            6




























































      As Reported









      As Reported
















      36 Weeks Ended









      36 Weeks Ended
















      September 6, 2013









      September 7, 2012

































      Contract Sales


      $                          20









      $                          31

























































      ** Denotes non-GAAP financial measures. Please see schedules A-18 through A-20 for additional information about our reasons for providing these alternative financial measures and limitations on their use.


      NOTE:

      As a result of a realignment of our management structure, beginning with the first quarter of 2013 we no longer allocate certain general and administrative expenses to our reportable segments. Prior year reportable segment information has been adjusted to reflect this change. We have restated 2012 Sale of vacation ownership products and Cost reimbursements revenues, Cost of vacation ownership products, Marketing and sales and Cost reimbursements expenses, and Segment financial results to correct prior period misstatements.


      A-9

      MARRIOTT VACATIONS WORLDWIDE CORPORATION

      CORPORATE AND OTHER

      12 Weeks and 36 Weeks Ended September 6, 2013 and September 7, 2012

      ($ in millions)



















































      As Reported




      As Adjusted



      As Reported




      As Adjusted










      12 Weeks Ended


      Certain


      12 Weeks Ended



      12 Weeks Ended


      Certain


      12 Weeks Ended










      September 6, 2013


      Charges


      September 6, 2013

      **


      September 7, 2012


      Charges


      September 7, 2012

      **

      Expenses


















      Cost of vacation ownership products

      $                            2


      $           -


      $                            2



      $                            2


      $           -


      $                            2



      Financing

      5


      -


      5



      5


      -


      5



      General and administrative

      23


      -


      23



      20


      -


      20



      Organizational and separation related


      4


      (4)


      -



      2


      (2)


      -



      Consumer financing interest


      7




      7



      10


      -


      10



      Royalty fee

      11


      -


      11



      11


      -


      11



      Interest

      2


      -


      2



      5


      -


      5







      Total expenses

      54


      (4)


      50



      55


      (2)


      53







      Financial results


      $                         (54)


      $          4


      $                        (50)



      $                         (55)


      $          2


      $                         (53)






























































































      As Reported




      As Adjusted



      As Reported




      As Adjusted










      36 Weeks Ended


      Certain


      36 Weeks Ended



      36 Weeks Ended


      Certain


      36 Weeks Ended










      September 6, 2013


      Charges


      September 6, 2013

      **


      September 7, 2012


      Charges


      September 7, 2012

      **

      Expenses


















      Cost of vacation ownership products

      $                            5


      $          -


      $ 5



      $                            5


      $           -


      $                            5



      Financing

      16


      -


      16



      18


      -


      18



      General and administrative

      66


      -


      66



      59


      -


      59



      Organizational and separation related


      7


      (7)


      -



      8


      (8)


      -



      Consumer financing interest


      22


      -


      22



      30


      -


      30



      Royalty fee

      34


      -


      34



      34


      -


      34



      Interest

      9


      -


      9



      12


      -


      12







      Total expenses

      159


      (7)


      152



      166


      (8)


      158







      Financial results


      $                       (159)


      $          7


      $                      (152)



      $                       (166)


      $          8


      $                      (158)























      ** Denotes non-GAAP financial measures. Please see schedules A-18 through A-20 for additional information about our reasons for providing these alternative financial measures and limitations on their use.


      NOTE:

      Corporate and Other captures information not specifically attributable to any individual segment including expenses in support of our financing operations, non-capitalizable development expenses supporting overall company development, company-wide general and administrative costs, interest expense and the fixed royalty fee payable under the license agreements with Marriott International, Inc. As a result of a realignment of our management structure, beginning with the first quarter of 2013 we no longer allocate certain general and administrative expenses to our reportable segments. Prior year reportable segment information has been adjusted to reflect this change.


      A-10

      MARRIOTT VACATIONS WORLDWIDE CORPORATION

      CONSOLIDATED CONTRACT SALES TO SALE OF VACATION OWNERSHIP PRODUCTS

      ($ in millions)













































































      12 Weeks Ended



























      September 6, 2013



      September 7, 2012














































      Contract sales









      $                       168



      $                       171














































      Revenue recognition adjustments:




























      Reportability1








      3



      (16)

















      Europe rescission adjustment2







      2



      (3)

















      Sales Reserve3








      (8)



      (6)

















      Other4








      (3)



      (3)
















      Sale of vacation ownership products








      $                       162



      $                       143














































      1 Adjustment for lack of required downpayment, contract sales in rescission period, or percentage completion accounting.



















      2 Adjustment to eliminate the impact of extended rescission periods in our Europe segment. Please see schedule A-19 for additional information.
















      3 Represents allowance for bad debts for our financed vacation ownership product sales, which we also refer to as sales reserve.



















      4 Adjustment represents sales incentives for plus points that will ultimately be recognized upon usage or expiration as rental revenues rather than revenues from the Sale of vacation ownership products.



































































      MARRIOTT VACATIONS WORLDWIDE CORPORATION

      CONSOLIDATED ADJUSTED DEVELOPMENT MARGIN (ADJUSTED SALE OF VACATION OWNERSHIP PRODUCTS NET OF EXPENSES)















      ($ in millions)


























































      Revenue











      Revenue













      As Reported




      Europe


      Recognition


      As Adjusted



      As Reported




      Europe


      Recognition


      As Adjusted











      12 Weeks Ended


      Certain


      Rescission


      Reportability


      12 Weeks Ended



      12 Weeks Ended


      Certain


      Rescission


      Reportability


      12 Weeks Ended











      September 6, 2013


      Charges


      Adjustment


      Adjustment


      September 6, 2013

      **


      September 7, 2012


      Charges


      Adjustment


      Adjustment


      September 7, 2012

      **


      Sale of vacation ownership products



      $                       162


      $          -


      $             (2)


      (3)


      $                       157



      $                       143


      $         -


      $               3


      $              16


      $                       162



      Less:






























      Cost of vacation ownership products


      56


      -


      (1)


      (1)


      54



      42


      -


      -


      6


      48




      Marketing and sales





      72


      -


      -


      (1)


      71



      79


      -


      1


      1


      81

































      Development margin






      $                         34


      $          -


      $             (1)


      $              (1)


      $                        32



      $                         22


      $         -


      $               2


      $                9


      $                         33


































































      Development margin percentage1


      21.1%








      20.3%



      15.6%








      20.9%




      ** Denotes non-GAAP financial measures. Please see schedules A-18 through A-20 for additional information about our reasons for providing these alternative financial measures and limitations on their use.


      1 Development margin percentage represents Development margin divided by Sale of vacation ownership products. Development margin percentage is calculated using whole dollars.



      NOTE:

      We have restated 2012 Sale of vacation ownership products, Cost of vacation ownership products, Marketing and sales, and Development margin to correct prior period misstatements.


      A-11

      MARRIOTT VACATIONS WORLDWIDE CORPORATION

      CONSOLIDATED CONTRACT SALES TO SALE OF VACATION OWNERSHIP PRODUCTS

      ($ in millions)













































































      36 Weeks Ended



























      September 6, 2013



      September 7, 2012














































      Contract sales









      $                       481



      $                       493














































      Revenue recognition adjustments:




























      Reportability1








      8



      (30)

















      Europe rescission adjustment2







      20



      (9)

















      Sales Reserve3








      (26)



      (29)

















      Other4








      (11)



      (9)
















      Sale of vacation ownership products








      $                       472



      $                       416














































      1Adjustment for lack of required downpayment, contract sales in rescission period, or percentage completion accounting.



















      2 Adjustment to eliminate the impact of extended rescission periods in our Europe segment. Please see schedule A-19 for additional information.

















      3 Represents allowance for bad debts for our financed vacation ownership product sales, which we also refer to as sales reserve.



















      4 Adjustment represents sales incentives for plus points that will ultimately be recognized upon usage or expiration as rental revenues rather than revenues from the Sale of vacation ownership products.



































































      MARRIOTT VACATIONS WORLDWIDE CORPORATION

      CONSOLIDATED ADJUSTED DEVELOPMENT MARGIN (ADJUSTED SALE OF VACATION OWNERSHIP PRODUCTS NET OF EXPENSES)

      ($ in millions)













































      Revenue











      Revenue













      As Reported




      Europe


      Recognition


      As Adjusted



      As Reported




      Europe


      Recognition


      As Adjusted











      36 Weeks Ended


      Certain


      Rescission


      Reportability


      36 Weeks Ended



      36 Weeks Ended


      Certain


      Rescission


      Reportability


      36 Weeks Ended











      September 6, 2013


      Charges


      Adjustment


      Adjustment


      September 6, 2013

      **


      September 7, 2012


      Charges


      Adjustment


      Adjustment


      September 7, 2012

      **


      Sale of vacation ownership products



      $                       472


      $         -


      $           (20)


      (8)


      $                       444



      $                       416


      $         -


      $               9


      $              30


      $                       455



      Less:






























      Cost of vacation ownership products


      157


      -


      (7)


      (3)


      147



      139


      -


      2


      11


      152




      Marketing and sales





      220


      (2)


      (2)


      (1)


      215



      231


      (1)


      1


      2


      233

































      Development margin






      $                         95


      $        2


      $           (11)


      $              (4)


      $                         82



      $                         46


      $       1


      $               6


      $              17


      $                         70




































































      Development margin percentage1



      20.3%








      18.4%



      11.2%








      15.4%




      ** Denotes non-GAAP financial measures. Please see schedules A-18 through A-20 for additional information about our reasons for providing these alternative financial measures and limitations on their use.


      1 Development margin percentage represents Development margin divided by Sale of vacation ownership products. Development margin percentage is calculated using whole dollars.




      NOTE:

      We have restated 2012 Sale of vacation ownership products, Cost of vacation ownership products, Marketing and sales, and Development margin to correct prior period misstatements.


      A-12

      MARRIOTT VACATIONS WORLDWIDE CORPORATION

      NORTH AMERICA CONTRACT SALES TO SALE OF VACATION OWNERSHIP PRODUCTS

      ($ in millions)

































































      12 Weeks Ended






















      September 6, 2013



      September 7, 2012






































      Contract sales







      $                       152



      $                       142






































      Revenue recognition adjustments:























      Reportability1






      2



      (13)














      Sales Reserve 2






      (6)



      (4)














      Other 3






      (3)



      (3)













      Sale of vacation ownership products






      $                       145



      $                       122






































      1 Adjustment for lack of required downpayment, contract sales in rescission period, or percentage completion accounting.











      2 Represents allowance for bad debts for our financed vacation ownership product sales, which we also refer to as sales reserve.









      3 Adjustment represents sales incentives for plus points that will ultimately be recognized upon usage or expiration as rental revenues rather than revenues from the Sale of vacation ownership products.



















































      MARRIOTT VACATIONS WORLDWIDE CORPORATION

      NORTH AMERICA ADJUSTED DEVELOPMENT MARGIN (ADJUSTED SALE OF VACATION OWNERSHIP PRODUCTS NET OF EXPENSES)

      ($ in millions)






































      Revenue









      Revenue












      As Reported




      Recognition


      As Adjusted



      As Reported




      Recognition


      As Adjusted










      12 Weeks Ended


      Certain


      Reportability


      12 Weeks Ended



      12 Weeks Ended


      Certain


      Reportability


      12 Weeks Ended










      September 6, 2013


      Charges


      Adjustment


      September 6, 2013

      **


      September 7, 2012


      Charges


      Adjustment


      September 7, 2012

      **

      Sale of vacation ownership products



      $                       145


      $         -


      $              (2)


      $                       143



      $                       122


      $         -


      $              13


      $                       135


      Less:

























      Cost of vacation ownership products


      51


      -


      (1)


      50



      36


      -


      6


      42



      Marketing and sales





      61


      -


      -


      61



      62


      -


      -


      62



























      Development margin






      $                         33


      $         -


      $              (1)


      $                         32



      $                         24


      $         -


      $                7


      $                         31

























































      Development margin percentage1



      22.7%






      22.2%



      19.2%






      22.8%



      ** Denotes non-GAAP financial measures. Please see schedules A-18 through A-20 for additional information about our reasons for providing these alternative financial measures and limitations on their use.


      1 Development margin percentage represents Development margin divided by Sale of vacation ownership products. Development margin percentage is calculated using whole dollars.



      NOTE:

      We combined the financial results of the former Luxury segment with the North America segment beginning with the first quarter of 2013 and have recast prior year presentation for consistency.


      A-13

      MARRIOTT VACATIONS WORLDWIDE CORPORATION

      NORTH AMERICA CONTRACT SALES TO SALE OF VACATION OWNERSHIP PRODUCTS

      ($ in millions)

































































      36 Weeks Ended






















      September 6, 2013



      September 7, 2012






































      Contract sales







      $                       437



      $                       419






































      Revenue recognition adjustments:























      Reportability1






      2



      (29)














      Sales Reserve 2






      (21)



      (22)














      Other 3






      (11)



      (9)













      Sale of vacation ownership products






      $                       407



      $                       359






































      1 Adjustment for lack of required downpayment, contract sales in rescission period, or percentage completion accounting.











      2 Represents allowance for bad debts for our financed vacation ownership product sales, which we also refer to as sales reserve.











      3 Adjustment represents sales incentives for plus points that will ultimately be recognized upon usage or expiration as rental revenues rather than revenues from the Sale of vacation ownership products.



















































      MARRIOTT VACATIONS WORLDWIDE CORPORATION

      NORTH AMERICA ADJUSTED DEVELOPMENT MARGIN (ADJUSTED SALE OF VACATION OWNERSHIP PRODUCTS NET OF EXPENSES)

      ($ in millions)






































      Revenue









      Revenue












      As Reported




      Recognition


      As Adjusted



      As Reported




      Recognition


      As Adjusted










      36 Weeks Ended


      Certain


      Reportability


      36 Weeks Ended



      36 Weeks Ended


      Certain


      Reportability


      36 Weeks Ended










      September 6, 2013


      Charges


      Adjustment


      September 6, 2013

      **


      September 7, 2012


      Charges


      Adjustment


      September 7, 2012

      **

      Sale of vacation ownership products



      $                       407


      $         -


      $ (2)


      $                       405



      $                       359


      $         -


      $              29


      $                       388


      Less:

























      Cost of vacation ownership products


      137


      -


      (1)


      136



      121


      -


      11


      132



      Marketing and sales





      187


      -


      -


      187



      183


      (1)


      2


      184



























      Development margin






      $                         83


      $         -


      $ (1)


      $                         82



      $                         55


      $        1


      $              16


      $                         72

























































      Development margin percentage1



      20.4%






      20.2%



      15.3%






      18.4%



      ** Denotes non-GAAP financial measures. Please see schedules A-18 through A-20 for additional information about our reasons for providing these alternative financial measures and limitations on their use.


      1 Development margin percentage represents Development margin divided by Sale of vacation ownership products. Development margin percentage is calculated using whole dollars.


      NOTE:

      We combined the financial results of the former Luxury segment with the North America segment beginning with the first quarter of 2013 and have recast prior year presentation for consistency.


      A-14


      MARRIOTT VACATIONS WORLDWIDE CORPORATION


      EBITDA AND ADJUSTED EBITDA


      12 Weeks and 36 Weeks Ended September 6, 2013 and September 7, 2012


      ($ in millions)























































      As Reported




      Europe


      As Adjusted


      As Reported




      Europe


      As Adjusted









      12 Weeks Ended


      Certain


      Rescission


      12 Weeks Ended


      12 Weeks Ended


      Certain


      Rescission


      12 Weeks Ended









      September 6, 2013


      Charges


      Adjustment


      September 6, 2013

      **

      September 7, 2012


      Charges


      Adjustment


      September 7, 2012

      **















































      Net income

      $                          25


      $          3


      $               (1)


      $                          27


      $                            5


      $          2


      $                1


      $                            8


      Interest expense1

      2


      -


      -


      2


      5


      -


      -


      5


      Tax provision

      15


      1


      -


      16


      11


      1


      1


      13


      Depreciation and amortization

      5


      -


      -


      5


      7


      -


      -


      7







      EBITDA **

      $                          47


      $          4


      $               (1)


      $                          50


      $                          28


      $          3


      $                2


      $                          33





































































































      As Reported




      Europe


      As Adjusted


      As Reported




      Europe


      As Adjusted









      36 Weeks Ended


      Certain


      Rescission


      36 Weeks Ended


      36 Weeks Ended


      Certain


      Rescission


      36 Weeks Ended









      September 6, 2013


      Charges


      Adjustment


      September 6, 2013

      **

      September 7, 2012


      Charges


      Adjustment


      September 7, 2012

      **















































      Net income

      $                          74


      $          7


      $              (8)


      $                          73


      $                          18


      $          6


      $                5


      $                          29


      Interest expense1

      9


      -


      -


      9


      12


      -


      -


      12


      Tax provision

      40


      2


      (3)


      39


      23


      4


      1


      28


      Depreciation and amortization

      16


      -


      -


      16


      21


      -


      -


      21







      EBITDA **

      $                        139


      $          9


      $            (11)


      $                        137


      $                          74


      $        10


      $                6


      $                          90

























      ** Denotes non-GAAP financial measures. Please see schedules A-18 through A-20 for additional information about our reasons for providing these alternative financial measures and limitations on their use.


      1 Interest expense excludes consumer financing interest expense.


      NOTE:

      We now report consumer financing interest expense separately from all other interest expense. As a result, adjusted EBITDA as reported in these schedules is equivalent to the non-GAAP financial measure adjusted EBITDA, as adjusted reported in prior releases. In addition, we have restated 2012 Net income and Tax provision to correct prior period misstatements.

      A-15



      MARRIOTT VACATIONS WORLDWIDE CORPORATION



      2013 ADJUSTED NET INCOME AND ADJUSTED EARNINGS PER SHARE - DILUTED OUTLOOK



      ($ in millions)
























      Fiscal Year 2013

       (low)


      Fiscal Year 2013

       (high)








      Net income



      $                    80


      $                    86









      Adjustments to reconcile Net income to Adjusted net income














      Organizational and separation related, litigation, and other charges1

      15


      15










      Europe rescission adjustment2


      (12)


      (12)










      Provision for income taxes on adjustments to net income

      (2)


      (2)











      Adjusted net income**


      $                    81


      $                    87
























      Earnings per share - Diluted3


      $                 2.19


      $                 2.35









      Adjusted earnings per share - Diluted**,3


      $                 2.21


      $                 2.37









      Diluted shares3


      36.7


      36.7





















      ** Denotes non-GAAP financial measures. Please see schedules A-18 through A-20 for additional information about our reasons for providing these alternative financial measures and limitations on their use.

      1 Organizational and separation related, litigation, and other charges adjustment includes $13 million for organizational and separation related efforts, $2 million for severance costs in our Europe segment, and $1 million for an impairment charge related to a leased golf course in our Europe segment, partially offset by a $1 million reversal of a previously recorded legal settlement related to a former Luxury segment project in our North America segment.

      2 Adjustment to eliminate the impact of extended rescission periods in our Europe segment. Please see schedule A-19 for additional information.

      3 Earnings per share - Diluted, Adjusted earnings per share - Diluted, and Diluted shares outlook does not reflect the impact of share repurchase activity.
































      MARRIOTT VACATIONS WORLDWIDE CORPORATION



      2013 ADJUSTED EBITDA OUTLOOK



      ($ in millions)
























      Fiscal Year 2013

       (low)


      Fiscal Year 2013

      (high)








      Adjusted net income **


      $                    81


      $                    87








      Interest expense1


      12


      12








      Tax provision


      50


      54








      Depreciation and amortization


      22


      22









      Adjusted EBITDA**


      $                  165


      $                  175





















      ** Denotes non-GAAP financial measures. Please see schedules A-18 through A-20 for additional information about our reasons for providing these alternative financial measures and limitations on their use.

      1 Interest expense excludes consumer financing interest expense.





































      MARRIOTT VACATIONS WORLDWIDE CORPORATION



      2013 ADJUSTED DEVELOPMENT MARGIN OUTLOOK









      Fiscal Year 2013

       (low)


      Fiscal Year 2013

       (high)








      Development margin1


      19.0%


      20.0%









      Adjustments to reconcile Development margin to Adjusted development margin













      Other charges2


      0.4%


      0.4%










      Revenue recognition reportability


      (0.3%)


      (0.3%)










      Europe rescission adjustment3


      (1.1%)


      (1.1%)











      Adjusted development margin**, 1


      18.0%


      19.0%





















      ** Denotes non-GAAP financial measures. Please see schedules A-18 through A-20 for additional information about our reasons for providing these alternative financial measures and limitations on their use.

      1 Development margin represents Development margin dollars divided by Sale of vacation ownership products revenues. Development margin is calculated using whole dollars.

      2 Other charges adjustment includes $2 million for severance costs in our Europe segment under the "Marketing and sales" caption.

      3 Adjustment to eliminate the impact of extended rescission periods in our Europe segment. Please see schedule A-19 for additional information.


      A - 16

      MARRIOTT VACATIONS WORLDWIDE CORPORATION

      2013 ADJUSTED FREE CASH FLOW OUTLOOK

      ($ in millions)


















      Fiscal Year 2013

       (low)


      Fiscal Year 2013

       (high)


      Adjusted net income **


      $                     81


      $                     87



      Adjustments to reconcile Adjusted net income to net cash







      provided by operating activities:








      Adjustments for non-cash items1


      70


      72




      Deferred income taxes / income taxes payable


      25


      30




      Net changes in assets and liabilities:









      Notes receivable originations


      (255)


      (260)





      Notes receivable collections


      300


      305





      Inventory



      15


      25





      Liability for Marriott Rewards customer loyalty program


      (50)


      (48)





      Organizational and separation related, litigation, and other charges

      (35)


      (33)





      Other working capital changes


      13


      1


      Net cash provided by operating activities

      164


      179



      Capital expenditures for property and equipment








      Organizational and separation related capital expenditures


      (10)


      (7)




      Other



      (15)


      (13)



      Increase in restricted cash


      (10)


      (5)





      Free cash flow**


      129


      154


      Borrowings from securitization transactions


      361


      361


      Repayment of debt related to securitizations

      (365)


      (370)





      Subtotal



      (4)


      (9)





      Adjusted free cash flow**


      125


      145


      Add:










      Organizational and separation related, litigation and other charges


      45


      40





      Adjusted free cash flow, as adjusted**


      $                   170


      $                   185














      ** Denotes non-GAAP financial measures. Please see schedules A-18 through A-20 for additional information about our reasons for providing these alternative financial measures and limitations on their use.




      1Includes depreciation, amortization of debt issuance costs, provision for loan losses, gain / loss on disposals, and share-based compensation.





      A-17

      MARRIOTT VACATIONS WORLDWIDE CORPORATION

      2013 NORMALIZED ADJUSTED FREE CASH FLOW OUTLOOK

      ($ in millions)


























      Current Guidance














      Low


      High


      Mid-Point


      Adjustments


      Normalized




      Adjusted net income **


      $     81


      $    87


      $          84


      $                   -


      $             84





      Adjustments to reconcile Adjusted net income to net cash















      provided by operating activities:
















      Adjustments for non-cash items1


      70


      72


      71


      -


      71






      Deferred income taxes / income taxes payable


      25


      30


      28


      (18)

      2

      10






      Net changes in assets and liabilities:

















      Notes receivable originations


      (255)


      (260)


      (258)


      (17)

      3

      (275)







      Notes receivable collections


      300


      305


      303


      (18)

      3

      285







      Inventory



      15


      25


      20


      (20)

      4

      -







      Liability for Marriott Rewards customer loyalty program


      (50)


      (48)


      (49)


      49

      5

      -







      Organizational and separation related, litigation, and other charges

      (35)


      (33)


      (34)


      34

      6

      -







      Other working capital changes


      13


      1


      7


      (7)

      7

      -




      Net cash provided by operating activities

      164


      179


      172


      3


      175





      Capital expenditures for property and equipment
















      Organizational and separation related capital expenditures


      (10)


      (7)


      (9)


      9

      6

      -






      Other



      (15)


      (13)


      (14)


      -


      (14)





      Increase in restricted cash


      (10)


      (5)


      (8)


      -


      (8)







      Free cash flow**


      129


      154


      141


      12


      153




      Borrowings from securitization transactions


      361


      361


      361


      (10)

      8

      351




      Repayment of debt related to securitizations

      (365)


      (370)


      (368)


      -


      (368)







      Subtotal



      (4)


      (9)


      (7)


      (10)


      (17)







      Adjusted free cash flow**


      125


      145


      134


      2


      136




      Add:


















      Organizational and separation related, litigation and other charges


      45


      40


      43


      (43)


      -







      Adjusted free cash flow, as adjusted**


      $   170


      $  185


      $        177


      $               (41)


      $           136






















      ** Denotes non-GAAP financial measures. Please see schedules A-18 through A-20 for additional information about our reasons for providing these alternative financial measures and limitations on their use.



      1 Includes depreciation, amortization of debt issuance costs, provision for loan losses, gain / loss on disposals, and share-based compensation.



      2 Represents cash taxes slightly lower than tax provision.






      3 Represents originations and collections associated with a 45% financing propensity rate.




      4 Represents adjustment to align real estate inventory spending with real estate inventory costs (i.e., product costs).




      5 Represents payment for Marriott Rewards Points issued prior to the Spin-off. Liability to be fully paid in 2016.




      6 Represents costs associated with organizational and separation related efforts (efforts projected to be completed in 2014) as well as litigation cash settlements paid in 2013.



      7 Represents normalized working capital activity.




      8 Represents elimination of additional 2013 securitization volume.























      A-18

      MARRIOTT VACATIONS WORLDWIDE CORPORATION

      NON-GAAP FINANCIAL MEASURES































      In our press release and schedules, and on the related conference call, we report certain financial measures that are not prescribed or authorized by United States generally accepted accounting principles ("GAAP").  We discuss our reasons for reporting these non-GAAP financial measures below, and the press release schedules reconcile the most directly comparable GAAP financial measure to each non-GAAP financial measure that we report (identified by a double asterisk ("**") on the preceding pages).  Although we evaluate and present these non-GAAP financial measures for the reasons described below, please be aware that these non-GAAP financial measures have limitations and should not be considered in isolation or as a substitute for revenues, net income, earnings per share or any other comparable operating measure prescribed by GAAP.  In addition, these non-GAAP financial measures may be calculated and / or presented differently than measures with the same or similar names that are reported by other companies, and as a result, the non-GAAP financial measures we report may not be comparable to those reported by others.
















      Adjusted Net Income.   We evaluate non-GAAP financial measures including Adjusted Net Income, Adjusted EBITDA, and Adjusted Development Margin, that exclude certain charges incurred in the 12 weeks and 36 weeks ended September 6, 2013 and September 7, 2012, and exclude adjustments related to the extension of rescission periods in our Europe segment ("Europe Rescission Adjustments"), because these non-GAAP financial measures allow for period-over-period comparisons of our on-going core operations before the impact of certain charges and Europe Rescission Adjustments.  These non-GAAP financial measures also facilitate our comparison of results from our on-going operations before certain charges and Europe Rescission Adjustments with results from other vacation ownership companies.
















               Certain Charges - 12 weeks and 36 weeks ended September 6, 2013.  In our Statement of Operations for the 12 weeks ended September 6, 2013, we recorded $4 million of pre-tax charges, which included $4 million of organizational and separation related costs recorded under the "Organizational and separation related" caption.  In our Statement of Operations for the 36 weeks ended September 6, 2013, we recorded $9 million of pre-tax charges, which included a $7 million increase in our accrual for remaining costs we expect to incur in connection with our interest in an equity method investment in a former Luxury segment joint venture project in our North America segment, $7 million of organizational and separation related costs recorded under the "Organizational and separation related" caption, $2 million of severance costs in our Europe segment recorded under the "Marketing and sales" caption, and a $1 million pre-tax non-cash impairment charge related to a leased golf course at a project in our Europe segment recorded under the "Impairment" caption, partially offset by a $7 million gain for cash received in payment of fully reserved receivables in connection with an equity method investment in a former Luxury segment joint venture project in our North America segment and a $1 million reversal of a previously recorded legal settlement related to a former Luxury segment project in our North America segment, based upon an agreement to settle the matter for an amount less than our accrual, recorded under the "Litigation settlement" caption. 
















              Certain Charges - 12 weeks and 36 weeks ended September 7, 2012.  In our Statement of Operations for the 12 weeks ended September 7, 2012, we recorded $3 million of pre-tax charges, which included $3 million of organizational and separation related costs recorded under the "Organizational and separation related" caption.  In our Statement of Operations for the 36 weeks ended September 7, 2012, we recorded $10 million of pre-tax charges, which included $9 million of organizational and separation related costs recorded under the "Organizational and separation related" caption, $2 million for a legal settlement in our North America segment related to a former Luxury segment project recorded under the "Litigation settlement" caption, and $1 million of severance in our North America segment recorded under the "Marketing and sales" caption, partially offset by the reversal of $2 million of a previously recorded impairment charge recorded in our North America segment under the "Impairment reversals on equity investment" caption related to an equity investment in a former Luxury segment vacation ownership joint venture project because the actual costs incurred to suspend our marketing and sales operations at the project were lower than previously estimated.  

      A-19

      MARRIOTT VACATIONS WORLDWIDE CORPORATION

      NON-GAAP FINANCIAL MEASURES































      Adjusted Net Income (continued)



























              Europe Rescission Adjustments.  In the second quarter of 2013, during the course of an internal review of certain sales documentation processes related to the sale of certain vacation ownership interests in properties associated with our Europe segment, we determined that the documentation we provided for certain sales of vacation ownership products was not strictly compliant.  As a result, in accordance with applicable European regulation, the period of time during which purchasers of such interests may rescind their purchases was extended.  We record revenues from the sale of vacation ownership products once the rescission period has ended.  Originally, we recorded revenues from these sales of vacation ownership products based on the rescission periods in effect assuming compliant documentation had been provided to the purchasers, rather than the extended periods.  As a result, we recognized revenue in incorrect periods between fiscal years 2010 and 2013 and misstated revenues in our previously filed consolidated financial statements.  We provided compliant documentation to purchasers for whom the extended rescission period had not yet expired.  As compliant documentation was subsequently provided as part of the corrective actions we took, the extended rescission period for most of the purchases at issue ended during the second quarter of 2013.  To better reflect our on-going core operations and allow for period-over-period comparisons, we have excluded the impact associated with the extended rescission periods in our adjusted financial measures for each period presented.

















              12 weeks and 36 weeks ended September 6, 2013.  In our Statement of Operations for the 12 weeks ended September 6, 2013, we recorded after-tax Europe Rescission Adjustments of $1 million, which included a $2 million pre-tax increase in Sale of vacation ownership products revenues and a $1 million pre-tax increase in Cost of vacation ownership products expense associated with the change in revenues from the Sale of vacation ownership products.  In our Statement of Operations for the 36 weeks ended September 6, 2013, we recorded after-tax Europe Rescission Adjustments of $8 million, which included a $20 million pre-tax increase in Sale of vacation ownership products revenues, pre-tax increases of $7 million and $2 million in Cost of vacation ownership products expense and Marketing and sales expense, respectively, associated with the change in revenues from the Sale of vacation ownership products, and a $3 million increase in the Provision for income taxes associated with the change in Income before income taxes. 

















              12 weeks and 36 weeks ended September 7, 2012.  In our Statement of Operations for the 12 weeks ended September 7, 2012, we recorded after-tax Europe Rescission Adjustments of $1 million, which included a $3 million pre-tax decrease in Sale of vacation ownership products revenues, a $1 million pre-tax decrease in Marketing and sales expense associated with the change in revenues from the Sale of vacation ownership products, and a $1 million decrease in the Provision for income taxes associated with the change in Income before income taxes.  In our Statement of Operations for the 36 weeks ended September 7, 2012, we recorded after-tax Europe Rescission Adjustments of $5 million, which included a $9 million pre-tax decrease in Sale of vacation ownership products revenues, pre-tax decreases of $2 million and $1 million in Cost of vacation ownership products expense and Marketing and sales expense, respectively, associated with the change in revenues from the Sale of vacation ownership products, and a $1 million decrease in the Provision for income taxes associated with the change in Income before income taxes.
















      Adjusted Development Margin (Adjusted Sale of Vacation Ownership Products Net of Expenses).  We evaluate Adjusted Development Margin (Adjusted Sale of Vacation Ownership Products Net of Expenses) as an indicator of operating performance.  Adjusted Development Margin adjusts Sale of vacation ownership products revenues for the impact of revenue reportability, includes corresponding adjustments to Cost of vacation ownership products expense and Marketing and sales expense associated with the change in revenues from the Sale of vacation ownership products, and includes adjustments for certain charges and Europe Rescission Adjustments as itemized in the discussion of Adjusted Net Income above.  We evaluate Adjusted Development Margin because it allows for period-over-period comparisons of our on-going core operations before the impact of revenue reportability, certain charges and Europe Rescission Adjustments to our Development Margin.

      A-20

      MARRIOTT VACATIONS WORLDWIDE CORPORATION

      NON-GAAP FINANCIAL MEASURES





































      Earnings Before Interest, Taxes, Depreciation and Amortization ("EBITDA").  EBITDA is defined as earnings, or net income, before interest expense (excluding consumer financing interest expense), provision for income taxes, depreciation and amortization.  For the purposes of our EBITDA calculation (which previously adjusted for consumer financing interest expense), we do not adjust for consumer financing interest expense because the associated debt is secured by vacation ownership notes receivable that have been sold to bankruptcy remote special purpose entities and is generally non-recourse to us.  Further, we consider consumer financing interest expense to be an operating expense of our business.  We now report consumer financing interest expense separately from all other interest expense.  As a result, adjusted EBITDA as reported in these schedules is equivalent to the non-GAAP financial measure adjusted EBITDA, as adjusted reported in prior releases.



















      We consider EBITDA to be an indicator of operating performance, and we use it to measure our ability to service debt, fund capital expenditures and expand our business. We also use it, as do analysts, lenders, investors and others, because it excludes certain items that can vary widely across different industries or among companies within the same industry.  For example, interest expense can be dependent on a company's capital structure, debt levels and credit ratings.  Accordingly, the impact of interest expense on earnings can vary significantly among companies.  The tax positions of companies can also vary because of their differing abilities to take advantage of tax benefits and because of the tax policies of the jurisdictions in which they operate.  As a result, effective tax rates and provision for income taxes can vary considerably among companies.  EBITDA also excludes depreciation and amortization because companies utilize productive assets of different ages and use different methods of both acquiring and depreciating productive assets.  These differences can result in considerable variability in the relative costs of productive assets and the depreciation and amortization expense among companies.



















      Adjusted EBITDA.  We also evaluate Adjusted EBITDA, which reflects additional adjustments for certain charges and Europe Rescission Adjustments for the 12 weeks and 36 weeks ended September 6, 2013 and September 7, 2012, as itemized in the discussion of Adjusted Net Income above.  We evaluate Adjusted EBITDA as an indicator of operating performance because it allows for period-over-period comparisons of our on-going core operations before the impact of certain charges and Europe Rescission Adjustments.  Together, EBITDA and Adjusted EBITDA facilitate our comparison of results from our on-going core operations before the impact of certain charges and Europe Rescission Adjustments with results from other vacation ownership companies.



















      Free Cash Flow.  We also evaluate Free Cash Flow as a liquidity measure that provides useful information to management and investors about the amount of cash provided by operating activities after capital expenditures for property and equipment and changes in restricted cash.  We consider Free Cash Flow to be a liquidity measure that provides useful information to management and investors about the amount of cash generated by the business that can be used for strategic opportunities, including acquisitions and strengthening the balance sheet.  Analysis of Free Cash Flow also facilitates management's comparison of our results with our competitors' results. 



















      Adjusted Free Cash Flow.  We also evaluate Adjusted Free Cash Flow as a liquidity measure that provides useful information to management and investors about the amount of cash provided by operating activities after capital expenditures for property and equipment, changes in restricted cash, and the borrowing and repayment activity related to our securitizations.  We consider Adjusted Free Cash Flow to be a liquidity measure that provides useful information to management and investors about the amount of cash generated by the business that can be used for strategic opportunities, including acquisitions and strengthening the balance sheet.  Analysis of Adjusted Free Cash Flow also facilitates management's comparison of our results with our competitors' results. 



















      Normalized Adjusted Free Cash Flow.  We also evaluate Normalized Adjusted Free Cash Flow as a liquidity measure that provides useful information to management and investors about the amount of cash provided by operating activities after capital expenditures for property and equipment, changes in restricted cash, the borrowing and repayment activity related to our securitizations, and adjustments to remove the impact of cash flow items not expected to occur on a regular basis.  Adjustments eliminate the impact of excess cash taxes, payments for Marriott Rewards Points issued prior to the Spin-off, payments for organizational and separation related efforts, litigation cash settlements and other working capital changes.  We consider Normalized Adjusted Free Cash Flow to be a liquidity measure that provides useful information to management and investors about the amount of cash generated by the business that can be used for strategic opportunities, including acquisitions and strengthening the balance sheet.  Analysis of Normalized Adjusted Free Cash Flow also facilitates management's comparison of our results with our competitors' results. 

      A-21


      MARRIOTT VACATIONS WORLDWIDE CORPORATION


      INTERIM CONSOLIDATED BALANCE SHEETS


      (In millions, except per share amounts)











      (Unaudited)


      December 28,





      September 6, 2013


      2012



      ASSETS






      Cash and cash equivalents

      $                          288


      $                 103



      Restricted cash (including $41 and $31 from VIEs, respectively)

      65


      68



      Accounts and contracts receivable (including $5 and $5 from VIEs, respectively)

      117


      100



      Vacation ownership notes receivable (including $784 and $727 from VIEs, respectively)

      978


      1,056



      Inventory

      859


      888



      Property and equipment

      250


      261



      Other

      103


      137



           Total Assets

      $                       2,660


      $              2,613










      LIABILITIES AND EQUITY






      Accounts payable

      $                            94


      $                 113



      Advance deposits

      44


      64



      Accrued liabilities (including $2 and $1 from VIEs, respectively)

      149


      181



      Deferred revenue

      19


      32



      Payroll and benefits liability

      80


      82



      Liability for Marriott Rewards customer loyalty program

      126


      159



      Deferred compensation liability

      37


      45



      Mandatorily redeemable preferred stock of consolidated subsidiary

      40


      40



      Debt (including $747 and $674 from VIEs, respectively)

      751


      678



      Other

      36


      38



      Deferred taxes

      66


      42



           Total Liabilities

      1,442


      1,474










      Preferred stock - $.01 par value; 2,000,000 shares authorized; none issued or outstanding

      -


      -



      Common stock - $.01 par value; 100,000,000 shares authorized; 35,394,854 and 35,026,533 shares






      issued and outstanding, respectively

      -


      -



      Additional paid-in capital

      1,122


      1,116



      Accumulated other comprehensive income

      20


      21



      Retained earnings

      76


      2



           Total Equity

      1,218


      1,139










           Total Liabilities and Equity

      $                       2,660


      $              2,613










      The abbreviation VIEs above means Variable Interest Entities.













      NOTE: We have restated 2012 Inventory, Other assets, Advance deposits, Deferred taxes and Retained earnings to correct prior period misstatements.



      A-22

      MARRIOTT VACATIONS WORLDWIDE CORPORATION

      INTERIM CONSOLIDATED STATEMENTS OF CASH FLOWS

      (In millions)

      (Unaudited)




      36 weeks ended




      September 6, 2013


      September 7, 2012

      OPERATING ACTIVITIES





      Net income


      $                          74


      $                          18

      Adjustments to reconcile net income to net cash provided by operating activities:






      Depreciation


      16


      21


      Amortization of debt issuance costs


      4


      5


      Provision for loan losses


      26


      29


      Share-based compensation


      8


      8


      Deferred income taxes


      23


      (23)


      Impairment charges


      1


      -


      Impairment reversals on equity investment


      -


      (2)


      Gain on disposal of property and equipment, net


      (1)


      -


      Net change in assets and liabilities:






      Accounts and contracts receivable


      (16)


      (15)


      Notes receivable originations


      (166)


      (164)


      Notes receivable collections


      217


      217


      Inventory


      33


      61


      Other assets


      33


      44


      Accounts payable, advance deposits and accrued liabilities


      (74)


      (35)


      Liability for Marriott Rewards customer loyalty program


      (33)


      (46)


      Deferred revenue


      (13)


      20


      Payroll and benefit liabilities


      (2)


      17


      Deferred compensation liability


      (8)


      (2)


      Other liabilities


      1


      4


      Other, net


      -


      1







                        Net cash provided by operating activities


      123


      158

      INVESTING ACTIVITIES






      Capital expenditures for property and equipment (excluding inventory)


      (11)


      (11)


      Decrease in restricted cash


      4


      9


      Dispositions


      3


      3







                        Net cash (used in) provided by investing activities


      (4)


      1

      FINANCING ACTIVITIES






      Borrowings from securitization transactions


      361


      238


      Repayment of debt related to securitization transactions


      (288)


      (295)


      Borrowings on Revolving Corporate Credit Facility


      25


      15


      Repayment of Revolving Corporate Credit Facility


      (25)


      (15)


      Debt issuance costs


      (5)


      -


      Proceeds from stock option exercises


      2


      4


      Payment of withholding taxes on vesting of restricted stock units


      (4)


      (3)







                       Net cash provided by (used in) financing activities


      66


      (56)








      Effect of changes in exchange rates on cash and cash equivalents


      -


      (1)







      INCREASE IN CASH AND CASH EQUIVALENTS


      185


      102







      CASH AND CASH EQUIVALENTS, beginning of period


      103


      110







      CASH AND CASH EQUIVALENTS, end of period


      $                        288


      $                        212



















      NOTE: We have restated 2012 Net income and reclassified certain items within Operating Activities to correct prior period misstatements.

      SOURCE Marriott Vacations Worldwide Corporation

      Modal title

      Contact PR Newswire

      • Call PR Newswire at 888-776-0942
        from 8 AM - 9 PM ET
      • Chat with an Expert
      • General Inquiries
      • Editorial Bureaus
      • Partnerships
      • Media Inquiries
      • Worldwide Offices

      Products

      • Explore Our Platform
      • Plan Campaigns
      • Create with AI
      • Distribute Press Releases
      • Report Results
      • Amplify Content

      About

      • About PR Newswire
      • About Cision
      • Careers
      • Accessibility Statement
      • APAC
      • APAC - Simplified Chinese
      • APAC - Traditional Chinese
      • Brazil
      • Canada
      • Czech
      • Denmark
      • Finland
      • France
      • Germany
      • India
      • Indonesia
      • Israel
      • Italy
      • Japan
      • Korea
      • Mexico
      • Middle East
      • Middle East - Arabic
      • Netherlands
      • Norway
      • Poland
      • Portugal
      • Russia
      • Slovakia
      • Spain
      • Sweden
      • United Kingdom
      • Vietnam

      My Services

      • All New Releases
      • Platform Login
      • Data Privacy

      Do not sell or share my personal information:

      • Submit via [email protected] 
      • Call Privacy toll-free: 877-297-8921

      Contact PR Newswire

      Products

      About

      My Services
      • All News Releases
      • Platform Login
      • ProfNet
      Call PR Newswire at
      888-776-0942
      • Terms of Use
      • Privacy Policy
      • Information Security Policy
      • Site Map
      • RSS
      • Cookies
      Copyright © 2026 Cision US Inc.