Travel+Leisure Co (TNL, Financial), the world's leading membership and leisure travel company, released its third-quarter 2023 financial results on October 25, 2023. The company reported a net income of $110 million, with $1.49 diluted earnings per share from continuing operations, on net revenue of $986 million. The company's adjusted EBITDA stood at $248 million, with adjusted diluted earnings per share of $1.54.
Financial Highlights
The company's Vacation Ownership business played a significant role in driving growth, with revenue increasing by 8% year-over-year. Net vacation ownership interest (VOI) sales were $433 million in the third quarter, compared to $403 million in the prior year period. Gross VOI sales were $598 million compared to $555 million in the prior year. The EBITDA growth of 8% is in line with the revenue growth.
On the other hand, Travel and Membership revenue decreased by 5% to $174 million in the third quarter of 2023 compared to the same period in the prior year. This was driven by a 7% decrease in transactions offset by a 1% increase in revenue per transaction.
Balance Sheet and Liquidity
As of September 30, 2023, the company's leverage ratio for covenant purposes was 3.7x. The company had $3.7 billion of corporate debt outstanding, which excluded $1.9 billion of non-recourse debt related to its securitized notes receivables portfolio. Additionally, the company had cash and cash equivalents of $238 million. At the end of the third quarter, the company had $785 million of liquidity in cash and cash equivalents and revolving credit facility availability.
Company's Outlook
For the full year 2023, the company expects an adjusted EBITDA of $900 million to $915 million, gross VOI sales of $2.15 billion to $2.2 billion, and VPG of approximately $3,100 to $3,150. For the fourth quarter of 2023, the company expects an adjusted EBITDA of $233 million to $248 million, gross VOI sales of $541 million to $591 million, and VPG of approximately $3,000 to $3,150.
Travel+Leisure Co (TNL, Financial) continues to demonstrate the strength of its business model, with the year-over-year growth of its cornerstone vacation ownership business. The company's acquisition of the rights to the vacation ownership business of Sports Hospitality Ventures sets the stage for future growth as it builds out a new network of sports-themed destinations under the Sports Illustrated Resorts brand.
