Here is the exact quote from Steve Weisz from this morning's call:
"We also continued our work on enhancing our product offerings across our multiple Marriott brands. As we shared with you previously, we continue to evaluate the various options, and our current plan is to add new enhancements in stages, each building on the strong foundation that we offer customers today. Over time, our goal is to develop an integrated product that leverages all of our Marriott family of brands, providing owners and potential owners an even greater array of vacation destinations and experiences from which to choose. We remain extremely optimistic about its potential, and we’ll have more to say about this in our Investor Day on October 4.”
He clearly says that enhancements will come in stages, with the ultimate goal of an integrated product.
There was also some discussion about asset sales. This was from CFO John Geller:
"We are undertaking a comprehensive review of our vacation ownership assets to determine the best strategic direction for the business. While work to quantify the impact continues, we do expect to generate incremental cash flows over the next few years.
Later Steve Weisz added:
"We're going through an assessment of the various assets we acquired when we bought the ILG business. There will probably be some things we'll agree that probably are not strategic for us in the long term, in terms of selling off individual parcels or things of that nature..."
There was also a question from one of the analysts about their development spending to acquire new inventory. John Geller said they look to budget for replacement of the inventory they sell "off the shelf". I think they consider ROFR part of their development spending, so that may explain some of the unpredictability of ROFR, in that they look at their inventory, and if inventory is low, they may be more aggressive with ROFR than if they feel they have excess. The analyst also tried to get a feel for whether 2020 development spending would increase from 2019, and Geller said that right now, he can't say that development spend will be higher next year.
On a couple of other items:
- Contract sales were up 6% over 2Q 2018. Both legacy MVW and ILG grew about 6%. They had expected MVW to grow at 10%, but they came in under that. Weisz said one factor was all of the changes they have made to their sales and marketing organization over the last 6-9 months. He said their sales leadership is predominantly from the MVC side of the business, and those managers spent a disproportionate amount of time in the VSE properties trying to drive some of the changes there, so they sort of "took their eye off the ball" on the MVC side.
- 2Q tour flows were 45% first time buyers, but only about a third of contract sales are first timers. He said there are slightly more first time buyers on the ILG side and slightly less on the MVC side.
- 62% of contract sales in the quarter were financed
- Interval International has announced a new agreement with Planet Fitness to leverage Interval technology to allow more than 8 million Planet Fitness Black Card members access to hotel, cruise, and condominium rental vacations at preferential rates.
- They have added more features to the Interval mobile app, including the ability to deposit a week.