Marriott Vacations Worldwide updates FY2020 outlook due to COVID-19 [MERGED]

[bazzap]

Challenging times ahead.

Mar. 18, 2020 9:10 AM ET|About: Marriott Vacations Worl... (VAC)|By: Niloofer Shaikh, SA News Editor
Marriott Vacations Worldwide (NYSE:VAC) is withdrawing its FY2020 outlook due to the impact on travel demand as a result of COVID-19.
As a precautionary measure, the Company recently drew down the remainder of its $600M Revolving Credit Facility to increase its cash position and preserve financial flexibility.

 

[DannyTS]

It looks like the market is treating both stocks the same. While MAR is closing hotels and sending staff home, VAC at least is collecting management fees, Interval fees and others even if the VOI sales will be down. Any comments?

 

[Swice]

VAC has issued new statement:
March 18 (Reuters) - Marriott Vacations Worldwide Corp
:

* MARRIOTT VACATIONS WORLDWIDE UPDATES 2020 OUTLOOK DUE TO
COVID-19

* MARRIOTT VACATIONS WORLDWIDE CORP - WITHDRAWING ITS
FULL-YEAR
2020 OUTLOOK DUE TO IMPACT ON TRAVEL DEMAND AS A RESULT OF
COVID-19.

* MARRIOTT VACATIONS WORLDWIDE CORP - WITHDRAWING ITS
FULL-YEAR
2020 OUTLOOK DUE TO IMPACT ON TRAVEL DEMAND AS A RESULT OF
COVID-19

* MARRIOTT VACATIONS WORLDWIDE CORP - RECENTLY DREW DOWN
REMAINDER
OF ITS $600 MILLION REVOLVING CREDIT FACILITY

* MARRIOTT VACATIONS WORLDWIDE - HAS CASH OF APPROXIMATELY
$615
MILLION AS WELL AS NEARLY $140 MILLION OF GROSS VACATION
OWNERSHIP NOTES RECEIVABLE

* MARRIOTT VACATIONS WORLDWIDE - HAS BEGUN TO SEE NEAR-TERM
CANCELLATIONS OF OWNER, EXCHANGE AND RENTAL RESERVATIONS AT ITS
RESORT BUSINESSES

* MARRIOTT VACATIONS WORLDWIDE - HAS BEGUN TO SEE
SIGNIFICANT
DECLINES IN ITS VACATION OWNERSHIP SALES

 

[SueDonJ]

It looks like the market is treating both stocks the same. While MAR is closing hotels and sending staff home, VAC at least is collecting management fees, Interval fees and others even if the VOI sales will be down. Any comments?

VAC inventory is for the most part owned by other than Marriott Vacations Worldwide and the thousands of deeds stipulate that MVW is the manager while the operating costs, including a Management Fee, are borne by the owners. II is similar in that the majority of the inventory being exchanged isn't owned by MVW or other participating timeshare companies. MAR inventory, though, is owned by entities who contract with MAR to put the name on the door and rent it to anybody, which naturally makes it subject to market influences with no guarantee of occupancy-related profits for either the owners or MAR.

Any major disruptive events on the vacation industry will impact related company stocks. We've been through it before, we'll go through it again. Eventually there'll be some bargains to be found but that's about the best we timeshare owners should expect.

This thread on the heels of other recent comments by you suggests that you think Marriott Vacations Worldwide should be somehow compensating its timeshare owners for this disruption. If I'm reading you wrong, I apologize. If not, I'm afraid I still disagree.

 

[DannyTS]

This thread on the heels of other recent comments by you suggests that you think Marriott Vacations Worldwide should be somehow compensating its timeshare owners for this disruption. If I'm reading you wrong, I apologize. If not, I'm afraid I still disagree.

Absolutely not, I do not think VAc should compensate the owners. My point is that the 2 companies are punished equally by the market. I understand that the hotels will be empty and with no revenue for a while but the resort expenses are still being paid in FULL by the owners so it should not be the same.

 

[SueDonJ]

Absolutely not, I do not think VAc should compensate the owners. My point is that the 2 companies are punished equally by the market. I understand that the hotels will be empty and with no revenue for a while but the resorts expenses are still being paid in FULL by the owners so it should not not be the same.

Ah, then I do apologize.

I just finished editing to include a basic comment on the stock situation. Fleshing it out, the timeshare stocks might not suffer because the costs for property upkeep are solvent but with reduced occupancy the onsite spends for food&beverage and activities - all substantial profit-generators for VAC - will nosedive. Also, the vacation industry is the first market segment to suffer when the market affects so many people so drastically. Timeshare purchases, especially developer-direct sales, don't do well at all when people's discretionary spending fund is erased. I think it's pretty much a guarantee that VAC will take a huge hit here.

 

[pchung6]

I cannot believe my limit order for VAC was filled @38 just minutes ago. I just placed another order @$28, but i think VAC stock might go down to $15 if this situation gets worsen. Keep safe and stay home everyone, we will have plenty of vacation after this is over.

 

[1Kflyerguy]

It looks like the market is treating both stocks the same. While MAR is closing hotels and sending staff home, VAC at least is collecting management fees, Interval fees and others even if the VOI sales will be down. Any comments?

Most of the developers need people at the resorts, so they can attend presentations and buy more points or weeks. I think clearly the sales volume for VAC, HGV, etc are going to take big hit this year.

As for resorts, i am wondering how bad things have to get before we start to see some these close down. I see that Club Wydam has already begun restricting check in as some locations.

 

[cp73]

Yes its going to be very interesting how both parts of their business do as well as owners of points and weeks. How long can the hotel side survive with 10% occupancy rates. I heard today this is the average worldwide occupancy rate today at hotels. Also whats going to happen again to the timeshare side. What are your points or weeks going to be worth. Seems to me the weeks took a big hit in 2009 and never really recovered much. What will those $30-$40k Maui Lahaina Tower or Napili tower weeks be worth today or in a few months. I should have known a couple of months ago when I was thinking about buying a Porsche that things were just going too good.

 

[MabelP]

It now says on MVC:
Cancellation Policy Information:
Due to extremely high call volumes, if you need to cancel a reservation for an arrival in the next 75 days, please complete the following feedback form.
Owners using Marriott Vacation Club Destination Points

• Arrival 61 days or more prior to check-in: Vacation Club Points will be returned to their account and the Points Premium(if any) will be returned to a Holding Account.
• Arrival 1-60 days prior to check-in, the Vacation Club Points will be returned to a Holding Account, and the Points Premium (if any) will be forfeited. Hold Points can be used for a reservation or select Explorer offerings within 120 days of arrival.
• Day of Arrival cancellations will result in the Vacation Club Points being forfeited.

Owners Using Ownership Weeks for a reservation

• Arrival 61 days or more prior to check-in: – Reservation can be cancelled, and Cancellation fees waived
• Arrival from 14-60 days prior to check-in: no cancellations are permitted, but week can be deposited with Interval International for a late deposit that can be reserved within 60 days of arrival
• Arrival from 3-14 days prior to check-in: no cancellations are permitted but a week can be deposited with Interval International for a week that can be reserved with Interval within 30 days of arrival
• Arrival from 0-2 days prior to arrival. No cancellations are permitted.

Due to continually changing conditions, these cancellations policies may be changed or modified as needed.
Other Reservations types

• If you have a reservation confirmed through Interval International, please contact them directly at 800-468-3782.
• If you have a rental reservation, please contact 1-800-Villas9
• If you have a Preview reservation, please contact 800-782-5410

Submit Your Cancellation Request







I am three days out. Does this mean I contact II directly or Fill out the form?

Many thanks,
Mabel

 

[Steve Fatula]

I am three days out. Does this mean I contact II directly or Fill out the form?

Well, it says:

"If you have a reservation confirmed through Interval International, please contact them directly at 800-468-3782."

So, if you have II reservation, do that. The form is for weeks or points owners that did not exchange.

 

[Mrs.SLLP]

Mabel, I would do both if booked with destination points or MVC weeks. Submitting an electronic request covers you because you should get an automatic written response. Calling in -- if you can reach someone even after an extended wait -- gives you the satisfaction of knowing your request has been serviced. But as pointed out by Steve Fatula, it appears that you need to be dealing directly with Interval International by phone -- immediately.
I am holding off cancelling April reservations to an Orlando resort that involves three units and more than 5,000 destination points. I am having difficulty imagining what the economy would look like if this crisis extends past this month. Marriott has agreed to at least allow 120 days to book out, but it bothers me that points will still be returned to a holding account during these uncharted times. Disney, on the other hand, has posted that its members will not be penalized by having their points restricted to a holding account. All the best to you.

 

[MabelP]

Thanks Steve and Mrs. SLLP,
It was an owner‘s week, but I never could get through to MVC To handle the problem. They still haven’t called me back and it’s over five hours!

• Arrival from 3-14 days prior to check-in: no cancellations are permitted but a week can be deposited with Interval International for a week that can be reserved with Interval within 30 days of arrival.

MVC email above says no cancellations but a week can be deposited to II. I could not tell if they were saying they would deposit for me or I should deposit myself.

I called II and was connected to an agent with no wait time. They deposited my week and gave me an exchange week.

 

[Mrs.SLLP]

Thanks Steve and Mrs. SLLP,
It was an owner‘s week, but I never could get through to MVC To handle the problem. They still haven’t called me back and it’s over five hours!

• Arrival from 3-14 days prior to check-in: no cancellations are permitted but a week can be deposited with Interval International for a week that can be reserved with Interval within 30 days of arrival.

MVC email above says no cancellations but a week can be deposited to II. I could not tell if they were saying they would deposit for me or I should deposit myself.

I called II and was connected to an agent with no wait time. They deposited my week and gave me an exchange week.

Mabel,
I am sorry you cannot travel as previously planned, but hope your second booking will be more than worth the wait. Take care.

 

[Steve Fatula]

Thanks Steve and Mrs. SLLP,
It was an owner‘s week, but I never could get through to MVC To handle the problem. They still haven’t called me back and it’s over five hours!

• Arrival from 3-14 days prior to check-in: no cancellations are permitted but a week can be deposited with Interval International for a week that can be reserved with Interval within 30 days of arrival.

MVC email above says no cancellations but a week can be deposited to II. I could not tell if they were saying they would deposit for me or I should deposit myself.

I called II and was connected to an agent with no wait time. They deposited my week and gave me an exchange week.

Yes, that is great! I am sure it's not ideal, however, better than nothing I hope.