Yahoo Finance Travel + Leisure Frustrated by Sluggish Vacation Exchange Sales
Travel+Leisure Group is focused on growing its vacation exchange — an underperforming part of its vacation ownership business — as revenues from the segment remained flat in the first quarter of this year.
The Travel and Membership segment, which includes vacation exchange brand RCI, saw a decrease in transactions. That trend was partly attributed to lower membership growth — with revenues totaling $200 million in the first quarter, according to results released on Wednesday.
“The macro trend around exchange has been intact for a decade now, which is across the industry,” said Travel + Leisure chief executive officer Michael Brown. “I mean that’s nothing new this quarter or last year or even pre-COVID. That’s been going on for a decade, which has created a natural headwind against the entire exchange space.”
Brown added that despite slower growth, the company is optimistic with its plan to spend marketing dollars and increase inventory to combat the sluggishness.
The company posted a consolidated net income of $64 million and revenue of $879 million for the first quarter. The company updated its full-year adjusted earnings before interest, taxes, depreciation, and amortization guidance from a range of between $920 million to $940 million to a range of between $925 million and $945 million.
The vacation ownership side of the business delivered 135,000 tours in the first quarter, a 24 percent growth over the prior year. That helped it drive a revenue increase of 12 percent and an estimated profit increase of 25 percent over the same period a year earlier.
“As new owners continue to come back into the timeshare space as we’re predicting and forecasting a nice jump this year in our business, that will provide a nice tailwind to the second half of the year and into 2024,” Brown said.
In March, Travel + Leisure sold its British subsidiary Love Home Swap to French vacation swap company HomeExchange, and reported that it incurred a $2 million loss on the sale of this subsidiary.
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