Marriott Vacations Worldwide has experienced strong demand for its timeshares in the first months of the year, with the exception of Western Maui which is still recovering from last year’s wildfires. The company saw a 3% increase in consolidated contract sales to $428 million for the first quarter, excluding its Maui properties. The slow recovery in Maui cost the company $17 million, impacting its overall growth momentum post-pandemic.
In Maui, travel demand remains weaker than before the wildfires, and hiring workers has been a struggle. The resort occupancies in the area are lower than usual, with Marriott Vacations Worldwide typically seeing rates of 97% in the winter months reduced to the low 90s this past year. Hiring sales and marketing staff has also been slow, affecting the company’s overall staffing levels. However, demand for resort destinations across the company’s network remains strong, with reservations for the upcoming summer months up both domestically and internationally.
Marriott Vacations Worldwide also generates revenue through vacation rentals, with the rental business generating $158 million in the quarter. The company reported operating profit in this segment was up 34% year-over-year, with revenues exceeding analysts’ forecasts. Rental rates have remained relatively flat, but occupancies have increased as people seek vacations in the summer months. The company also benefits from “preview nights,” where travelers stay in exchange for listening to a timeshare sales pitch, with higher volumes expected this year.
Looking ahead, the company is set to open a new Marriott Vacation Club Resort in Waikiki later this year, with strong reservations already in place. Executives expect growth in international markets, particularly in Asia Pacific, driven by new property developments. The company reaffirmed guidance for contract sales to grow between 6 to 9% for the full year. In terms of financial performance, Marriott Vacations Worldwide generated $71 million in adjusted net income for the first quarter, a 34% decrease year-over-year, and $1.195 billion in revenue, a 2% increase.
The company expects adjusted EBITDA in the range of $760 million to $800 million for the full year, reaffirming its guidance for 2024. Overall, Marriott Vacations Worldwide is optimistic about its future growth, despite challenges in specific markets such as Western Maui. The company continues to see strong demand for its timeshares and vacation rentals, with new property developments and strategic agreements driving sales in international markets. As the travel industry continues to recover post-pandemic, Marriott Vacations Worldwide remains focused on expanding its offerings and meeting the evolving needs of travelers worldwide.
