Starwood Results

Starwood Hotels & Resorts Reports an 11 Percent Fall in Quarterly Profit for Q2 2015

Lowers 2015 Forecast

Starwood

Starwood Hotels & Resorts Worldwide, Inc. (HOT) today reported second quarter 2015 financial results.

Second Quarter 2015 Highlights

  • Excluding special items, EPS from continuing operations was $0.84. Including special items, EPS from continuing operations was $0.79.
  • Adjusted EBITDA was $311 million.
  • Excluding special items, income from continuing operations was $143 million. Including special items, income from continuing operations was $136 million.
  • Worldwide Systemwide REVPAR for Same-Store Hotels increased 4.1% in constant dollars (decreased 0.7% in actual dollars) compared to 2014. Systemwide REVPAR for Same-Store Hotels in North America increased 5.3% in constant dollars (4.1% in actual dollars).
  • Management fees, franchise fees and other income, which were negatively impacted by foreign exchange rates, decreased 1.5% compared to 2014. Core fees decreased 1.0% compared to 2014.
  • Earnings from Starwood’s vacation ownership and residential business decreased approximately $2 million compared to 2014.
  • During the quarter, the Company signed 64 hotel management and franchise contracts, representing approximately 14,400 rooms, a 69% increase in signed rooms compared to 2014. The Company also opened 21 hotels and resorts with approximately 4,000 rooms in the second quarter of 2015.
  • During the quarter, the Company paid a quarterly dividend of $0.375 per share and repurchased 1.2 million shares at a total cost of $105 million and a weighted average price of $84.24 per share.
  • During the quarter, the Company sold three hotels for gross cash proceeds of approximately $533 million, subject to long-term management or franchise contracts.

Second Quarter 2015 Earnings Summary

Starwood Hotels & Resorts Worldwide, Inc. (“Starwood” or the “Company”) today reported EPS from continuing operations for the second quarter of 2015 of $0.79 compared to $0.80 in the second quarter of 2014. Excluding special items, EPS from continuing operations was $0.84 for the second quarter of 2015 compared to $0.77 in the second quarter of 2014.

Special items in the second quarter of 2015 consisted of restructuring and other special charges of $23 million (pre-tax and $12 million after-tax), as well as a $5 million tax benefit on certain non-recurring items. Special items in the second quarter of 2014 totaled a benefit of $6 million (after-tax). Excluding special items, the effective income tax rate in the second quarter of 2015 was 30.1% compared to 33.3% in the second quarter of 2014.

Income from continuing operations was $136 million in the second quarter of 2015, compared to $153 million in the second quarter of 2014. Excluding special items, income from continuing operations was $143 million in the second quarter of 2015 compared to $147 million in the second quarter of 2014.

Net income was $136 million and $0.79 per share in the second quarter of 2015, compared to $153 million and $0.80 per share in the second quarter of 2014.

Adam Aron, Chief Executive Officer of the Company on an interim basis, said, “Starwood delivered strong Adjusted EBITDA and EPS before special items in the second quarter of 2015, even in the face of macroeconomic headwinds. We improved our performance while streamlining our organization and reducing our costs.

“At the same time, we have initiated efforts to reinvigorate our brands with the launch of the new Tribute Portfolio brand and the announcement of Sheraton 2020. Similar efforts to enhance the market strength of all our brands are underway, especially for The Luxury Collection and Aloft. Our pace of hotel footprint growth is also accelerating, with strong signings in the second quarter.

“The sales of the Gritti Palace, the Phoenician and the Element Denver Park Meadows indicate that we are successfully executing against our asset light strategy. Looking ahead, we remain bullish about our long term growth.”

Six Months Ended June 30, 2015 Earnings Summary

Income from continuing operations was $235 million in the six months ended June 30, 2015 compared to $289 million in the same period in 2014. Excluding special items, income from continuing operations was $253 million in the six months ended June 30, 2015 compared to $269 million in the same period in 2014. The decreases primarily reflect the impact of the sales of nine hotels since the second quarter of 2014.

Net income was $235 million and $1.37 per share in the six months ended June 30, 2015 compared to $290 million and $1.52 per share in the same period in 2014.

Adjusted EBITDA was $585 million in the six months ended June 30, 2015 compared to $605 million in the same period in 2014.

Second Quarter 2015 Operating Results

Management and Franchise Revenues

Worldwide Systemwide REVPAR for Same-Store Hotels increased 4.1% in constant dollars (decreased 0.7% in actual dollars) compared to the second quarter of 2014. International Systemwide REVPAR for Same-Store Hotels increased 2.7% in constant dollars (decreased 6.6% in actual dollars).

Changes in REVPAR for Worldwide Systemwide Same-Store Hotels by region:

            REVPAR      
Region          

Constant

Dollars

           

Actual

Dollars

     
Americas:                                    
North America             5.3 %             4.1 %    
Latin America             (3.2 )%             (3.2 )%    
Asia Pacific:                                    
Greater China             (0.3 )%             0.1 %    
Rest of Asia             7.5 %             (2.4 )%    
Europe, Africa & Middle East:                                    
Europe             6.1 %             (14.0 )%    
Africa & Middle East             (4.0 )%             (8.2 )%    
                                     

Changes in REVPAR for Worldwide Systemwide Same-Store Hotels by brand:

            REVPAR      
Brand           Constant

Dollars

            Actual

Dollars

     
St. Regis/Luxury Collection             5.1 %             (2.8 )%    
W Hotels             3.8 %             0.5 %    
Westin             5.9 %             1.6 %    
Sheraton             2.6 %             (1.5 )%    
Le Méridien             2.3 %             (6.5 )%    
Four Points by Sheraton             3.4 %             (0.6 )%    
Aloft             10.0 %             8.5 %    
                                     

Worldwide Same-Store Company-Operated gross operating profit margins increased approximately 50 basis points compared to 2014. International gross operating profit margins for Same-Store Company-Operated properties increased approximately 20 basis points. North American Same-Store Company-Operated gross operating profit margins increased approximately 75 basis points.

Management fees, franchise fees and other income, which were negatively impacted by foreign exchange rates, were $256 million, down $4 million, or 1.5% compared to the second quarter of 2014. Core fees decreased 1.0% to $206 million. Other management and franchise revenues decreased 4.2% or $2 million.

Development

During the second quarter of 2015, the Company signed 64 hotel management and franchise contracts, representing approximately 14,400 rooms, of which 49 are new builds and 15 are conversions from other brands. At June 30, 2015, the Company had approximately 500 hotels in the active pipeline representing approximately 112,000 rooms.

During the second quarter of 2015, 21 new hotels and resorts (representing approximately 4,000 rooms) entered the system, including Sheraton Zhanjiang Hotel (China, 440 rooms), Le Méridien Saigon (Vietnam, 350 rooms), Sheraton Barra Rio de Janeiro Hotel (Brazil, 292 rooms), The Westin Jekyll Island (Georgia, 200 rooms), Aloft South Beach (Florida, 237 rooms), and Augustine, a Luxury Collection Hotel, Prague (Czech Republic, 101 rooms). During the quarter, eight properties (representing approximately 1,800 rooms) were removed from the system.

Owned Hotels

Worldwide REVPAR at Starwood Same-Store Owned Hotels increased 6.8% in constant dollars (decreased 2.6% in actual dollars) when compared to 2014. REVPAR at Starwood Same-Store Owned Hotels in North America increased 8.6% in constant dollars (4.8% actual dollars). Internationally, Starwood Same-Store Owned Hotel REVPAR increased 4.9% in constant dollars (decreased 10.3% in actual dollars).

Revenues at Starwood Same-Store Owned Hotels Worldwide increased 7.3% in constant dollars (decreased 2.0% in actual dollars) while costs and expenses increased 5.6% in constant dollars (decreased 3.0% in actual dollars) when compared to 2014. Margins at these hotels increased approximately 80 basis points compared to 2014.

Revenues at Starwood Same-Store Owned Hotels in North America increased 8.2% in constant dollars (4.4% in actual dollars) while costs and expenses increased 5.8% in constant dollars (2.5% in actual dollars) when compared to 2014. Margins at these hotels increased approximately 150 basis points compared to 2014.

Internationally, revenues at Starwood Same-Store Owned Hotels increased 6.3% in constant dollars (decreased 8.9% in actual dollars) while costs and expenses increased 5.4% in constant dollars (decreased 9.5% in actual dollars) when compared to 2014. Margins at these hotels increased approximately 40 basis points compared to 2014.

Revenues at Owned Hotels, which were negatively impacted by asset sales since the second quarter of 2014, were $356 million, compared to $414 million in 2014. Expenses at Owned Hotels were $265 million compared to $314 million in 2014.

Vacation Ownership

Vacation ownership revenues for the three months ended June 30, 2015 increased 5.6%, to $169 million, compared to the corresponding period in 2014 primarily due to the timing of deferred revenues and an increase in revenues from resort operations. Originated contract sales of vacation ownership intervals remained flat for the three months ended June 30, 2015, compared to the corresponding period in 2014, with a 1.8% increase in the number of contracts signed, offset by a decrease in the average price per vacation ownership unit sold to approximately $14,800.

Residential

During the second quarter of 2015, the Company’s residential revenues were $1 million compared to $11 million in 2014 as the St. Regis Bal Harbour residential project sold out in early 2014.

Selling, General, Administrative and Other

During the second quarter of 2015, selling, general, administrative and other expenses (“SG&A”) decreased 2.9% to $99 million compared to $102 million in 2014, primarily due to an acceleration of the implementation of the Company’s previously announced cost savings initiatives and timing of expenses. The Company now targets a decrease of 2% to 4% for the full year.

Capital

Gross capital spending during the quarter included approximately $37 million of maintenance capital and $38 million of development capital.

Asset Sales

During the second quarter of 2015, the Company completed the sales of The Phoenician, a Luxury Collection Resort, Scottsdale, for gross cash proceeds of $400 million and The Gritti Palace, a Luxury Collection Hotel, Venice, for gross cash proceeds of approximately $117 million, both of which were sold subject to long-term management contracts. Additionally, during the second quarter of 2015, the Company sold the Element Denver Park Meadows for gross cash proceeds of approximately $16 million, subject to a long-term franchise contract. Year to date through June 30, 2015, the Company has received gross cash proceeds from asset sales of approximately $566 million, including approximately $33 million from the sale of minority interests in two hotels.

Restructuring and Other Special Charges

During the second quarter of 2015, the Company recorded $13 million of restructuring charges associated with its previously announced cost savings initiatives and $10 million of other special charges. Other special charges primarily consist of costs associated with the planned spin-off of the Company’s vacation ownership business.

Dividend

On May 28, 2015, the Company declared a regular quarterly dividend of $0.375 per share, which was paid on June 17, 2015. The total dividends paid in the second quarter of 2015 were approximately $64 million.

Share Repurchase

In the second quarter of 2015, the Company repurchased 1.2 million shares at a total cost of approximately $105 million and a weighted average price of $84.24 per share. As of June 30, 2015, approximately $601 million remained available under the Company’s share repurchase authorization. Year to date through June 30, 2015, the Company has repurchased 2.8 million shares at a total cost of $228 million and an average price of $80.91.

Balance Sheet

At June 30, 2015, the Company had gross debt of $2.1 billion, cash and cash equivalents of $769 million (including $34 million of restricted cash) and net debt of $1.4 billion, compared to net debt of $1.7 billion as of December 31, 2014, in each case excluding debt and restricted cash associated with securitized vacation ownership notes receivable. Net debt at June 30, 2015, including $208 million of debt and $11 million of restricted cash associated with securitized vacation ownership notes receivable, was $1.6 billion.

Outlook

  • The following outlook assumes the planned spin-off of the vacation ownership business occurs on December 31, 2015. Transaction costs related to the planned spin-off are not included in full year SG&A guidance.

For the full year 2015:

  • Adjusted EBITDA is expected to be approximately $1.175 billion to $1.200 billion (based on the assumptions below).
    • REVPAR increases at Same-Store Systemwide Hotels Worldwide of 4% to 6% in constant dollars (approximately 400 basis points lower in actual dollars at current exchange rates).
    • REVPAR increases at Same-Store Owned Hotels Worldwide of 5% to 7% in constant dollars (approximately 650 basis points lower in actual dollars at current exchange rates).
    • Margins at Same-Store Owned Hotels Worldwide increase 50 to 100 basis points.
    • Core fees increase approximately 2% to 4%.
    • Management fees, franchise fees and other income are expected to be approximately flat.
    • Earnings from the Company’s vacation ownership and residential business of approximately $155 million to $165 million.
    • SG&A decreases approximately 2% to 4%.
    • Significant non-recurring items in 2014 Adjusted EBITDA include $35 million related to five large one-time termination fees received by the Company and $11 million from the St. Regis Bal Harbour residential project, which is sold out.
    • Shifts in exchange rates since 2014 will negatively impact full year earnings by approximately $41 million if exchange rates stay at current levels.
  • Depreciation and amortization is expected to be approximately $307 million.
  • Interest expense is expected to be approximately $135 million.
  • Full year effective tax rate is expected to be approximately 32%, and cash taxes from operating earnings are expected to be approximately $135 million.
  • EPS before special items is expected to be approximately $2.93 to $3.03 (based on the assumptions above).
  • Cash flow from operations is expected to be approximately $740 million to $840 million (based on the assumptions above). Cash flow from operations includes vacation ownership investment in inventory expected to be approximately $160 million which includes approximately $80 million related to the development of the Westin Nanea Ocean Villas, the third phase of the Westin Ka’anapali Ocean Resort Villas.
  • Full year capital expenditures (excluding vacation ownership inventory) are expected to be approximately $200 million for maintenance, renovation and technology. In addition, in-flight investment projects and prior commitments for joint ventures and other investments are expected to total approximately $200 million.

For the three months ended September 30, 2015:

  • Adjusted EBITDA is expected to be approximately $285 million to $295 million (based on the assumptions below).
    • REVPAR increases at Same-Store Systemwide Hotels Worldwide of 4% to 6% in constant dollars (approximately 550 basis points lower in actual dollars at current exchange rates).
    • REVPAR increases at Same-Store Owned Hotels Worldwide of 4% to 6% in constant dollars (approximately 800 basis points lower in actual dollars at current exchange rates).
    • Core fees increase approximately 1% to 3%.
    • Management fees, franchise fees and other income increase 2% to 4%.
    • Earnings from the Company’s vacation ownership and residential business of approximately $35 million to $40 million.
    • Shifts in exchange rates since the third quarter of 2014 will negatively impact third quarter 2015 earnings by approximately $11 million if exchange rates stay at current levels.
  • EPS is expected to be approximately $0.69 to $0.73 (based on the assumptions above).

Special Items

The Company’s special items included a pre-tax charge of $23 million ($7 million charge after-tax) in the second quarter of 2015 compared to a pre-tax and after-tax benefit of $6 million in the same period of 2014.

The following represents a reconciliation of income from continuing operations before special items to income from continuing operations including special items (in millions, except per share data):

                           

Three Months Ended

June 30,

                 

Six Months Ended

June 30,

     
2015         2014                   2015         2014      
$     143         $     147         Income from continuing operations before special items         $       253         $       269      
$     0.84         $     0.77         EPS before special items         $       1.48         $       1.40      
                                Special Items                                          
      (23 )             3         Restructuring and other special (charges) credits, net (a)                 (54 )               3      
                    3         Gain (loss) on asset dispositions and impairments, net (b)                 14                 (33 )    
                            Gain on sale of an unconsolidated joint venture hotel (c)                 4                      
      (23 )             6         Total special items – pre-tax                 (36 )               (30 )    
      13                       Income tax benefit (expense) for special items (d)                 13                 (2 )    
      3                       Income tax benefit - other non-recurring items (e)                 5                 52      
      (7 )             6         Total special items – after-tax                 (18 )               20      
$     136         $     153         Income from continuing operations         $       235         $       289      
$     0.79         $     0.80         EPS including special items         $       1.37         $       1.51      
                                                                           
a)     During the three months ended June 30, 2015, the net charge relates to costs associated with the Company’s previously announced cost savings initiatives of $12 million, $10 million in costs associated with the planned spin-off of the vacation ownership business, and a $6 million charge for technology related costs and expenses that the Company no longer deems recoverable, partially offset by the reversal of $5 million of reserves as a result of the favorable resolutions of an exposure from a previous disposition, and a dispute with a foreign taxing authority. During the six months ended June 30, 2015, the net charge further includes $15 million in severance costs, including $7 million associated with the resignation of the Company’s former CEO, the establishment of a $6 million reserve related to potential liabilities assumed in connection with the 2005 acquisition of Le Méridien, and $6 million in costs associated with the planned spin-off of the vacation ownership business.
b)     During the six months ended June 30, 2015, the net benefit primarily relates to the sale of a minority partnership interest in a hotel. During the three months ended June 30, 2014, the net gain is primarily due to the conversion of a leased hotel to a managed hotel discussed below. During the six months ended June 30, 2014, the net loss primarily relates to the impairment of two hotels, one of which was sold subject to a long-term franchise contract and the other of which represents a leased hotel that was converted to a managed hotel. In addition, during the six months ended June 30, 2014, the Company recorded an impairment charge associated with one of its foreign unconsolidated joint ventures.
c)     During the six months ended June 30, 2015, the net benefit relates to a gain recognized on the sale of a hotel by a joint venture in which the Company holds a minority interest. This gain is included in the equity earnings and gains from unconsolidated ventures, net line item in the statement of income.
d)     During the three and six months ended June 30, 2015 and 2014, the amounts primarily relate to the tax benefit (expense) on the pre-tax special items.
e)     During the three months ended June 30, 2015, the $3 million benefit primarily relates to favorable tax law changes. During the six months ended June 30, 2015, the net benefit further includes a change in tax reserves. During the six months ended June 30, 2014, the net benefit primarily relates to the settlement of a foreign tax audit.
       

The Company has included the above supplemental information concerning special items to assist investors in analyzing Starwood’s financial position and results of operations. The Company has chosen to provide this information to investors to enable them to perform meaningful comparisons of past, present and future operating results and as a means to emphasize the results of core ongoing operations.

Definitions

All references to EPS, unless otherwise noted, reflect earnings per diluted share from continuing operations attributable to Starwood’s common stockholders. All references to continuing operations, discontinued operations and net income reflect amounts attributable to Starwood’s common stockholders (i.e., excluding amounts attributable to noncontrolling interests). All references to net capital expenditures mean gross capital expenditures for timeshare and fractional inventory net of cost of sales. EBITDA represents net income before interest expense, taxes, depreciation and amortization. The Company believes that EBITDA is a useful measure of the Company’s operating performance due to the significance of the Company’s long-lived assets and level of indebtedness. EBITDA is a commonly used measure of performance in its industry which, when considered with GAAP measures, the Company believes gives a more complete understanding of the Company’s operating performance. It also facilitates comparisons between the Company and its competitors. The Company’s management has historically adjusted EBITDA (i.e., “Adjusted EBITDA”) when evaluating operating performance for the Company, as well as for individual properties or groups of properties, because the Company believes that the inclusion or exclusion of certain recurring and non-recurring items, such as restructuring and other special charges (credits) and gains and losses on asset dispositions and impairments, is necessary to provide the most accurate measure of core operating results and as a means to evaluate comparative results. The Company’s management also uses Adjusted EBITDA as a measure in determining the value of acquisitions and dispositions and it is used in the annual budget process. The Company has historically reported this measure to its investors and believes that the continued inclusion of Adjusted EBITDA provides consistency in its financial reporting and enables investors to perform more meaningful comparisons of past, present and future operating results and provides a means to evaluate the results of its core ongoing operations. EBITDA and Adjusted EBITDA are not intended to represent cash flow from operations as defined by GAAP and such metrics should not be considered as an alternative to net income, cash flow from operations or any other performance measure prescribed by GAAP. The Company’s calculation of EBITDA and Adjusted EBITDA may be different from the calculations used by other companies and, therefore, comparability may be limited.

All references to Owned or Owned Hotels reflect the Company’s owned, leased, and consolidated joint venture hotels. All references to Same-Store Owned Hotels reflect the Company’s owned, leased and consolidated joint venture hotels, excluding condo hotels, hotels sold to date and hotels undergoing significant repositionings or for which comparable results are not available (i.e., hotels not owned during the entire periods presented or closed due to seasonality or natural disasters). References to Company-Operated Hotel metrics (e.g., REVPAR) reflect metrics for the Company’s Owned and managed hotels. References to Systemwide metrics (e.g., REVPAR) reflect metrics for the Company’s Owned, managed and franchised hotels. REVPAR is defined as revenue per available room. ADR is defined as average daily rate.

All references to revenues in constant dollars represent revenues excluding the impact of the movement of foreign exchange rates. The Company calculates revenues in constant dollars by calculating revenues for the current year using the prior year’s exchange rates. The Company uses this revenue measure to better understand the underlying results and trends of the business, excluding the impact of movements in foreign exchange rates.

All references to contract sales or originated sales reflect vacation ownership sales before revenue adjustments for percentage of completion accounting methodology. All references to earnings from vacation ownership and residential represents operating income before depreciation expense. All references to management and franchise revenues represent base and incentive fees, franchise fees, amortization of deferred gains resulting from the sales of hotels subject to long-term management contracts and termination fees. All references to core fees represent total management and franchise fees.

Starwood Hotels & Resorts Worldwide, Inc. is one of the leading hotel and leisure companies in the world with more than 1,200 properties in some 100 countries and over 180,000 employees at its owned and managed properties. Starwood is a fully integrated owner, operator and franchisor of hotels, resorts and residences under the renowned brands: St. Regis®, The Luxury Collection®, W®, Westin®, Le Méridien®, Sheraton®, Four Points® by Sheraton, Aloft®, Element® and the recently introduced Tribute Portfolio™.

STARWOOD HOTELS & RESORTS WORLDWIDE, INC.    
Unaudited Consolidated Statements of Income    
(In millions, except per share data)    
     

Three Months Ended

June 30,

                     

Six Months Ended

June 30,

     
2015       2014      

%

Variance

                      2015       2014      

%

Variance

     
                                                  Revenues                                                    
$       356       $       414           (14.0 )           Owned, leased and consolidated joint venture hotels         $       672       $       778           (13.6 )    
        170               171           (0.6 )           Vacation ownership and residential sales and services                 357               345           3.5      
        256               260           (1.5 )           Management fees, franchise fees and other income                 496               508           (2.4 )    
        699               694           0.7             Other revenues from managed and franchised properties (a)                 1,371               1,366           0.4      
        1,481               1,539           (3.8 )                             2,896               2,997           (3.4 )    
                                                  Costs and Expenses                                                    
        265               314           15.6             Owned, leased and consolidated joint venture hotels                 527               615           14.3      
        126               125           (0.8 )           Vacation ownership and residential                 263               253           (4.0 )    
        99               102           2.9             Selling, general, administrative and other                 190               197           3.6      
        23               (3 )     n/m             Restructuring and other special charges (credits), net                 54               (3 )     n/m      
        65               63           (3.2 )           Depreciation                 127               123           (3.3 )    
        8               7           (14.3 )           Amortization                 15               15                
        699               694           (0.7 )           Other expenses from managed and franchised properties (a)                 1,371               1,366           (0.4 )    
        1,285               1,302           1.3                               2,547               2,566           0.7      
        196               237           (17.3 )           Operating income                 349               431           (19.0 )    
        11               9           22.2            

Equity earnings and gains from unconsolidated ventures,

  net

                26               18           44.4      
        (27 )             (23 )         (17.4 )          

Interest expense, net of interest income of $1, $1, $2

  and $2

                (58 )             (46 )         (26.1 )    
                      3           (100.0 )           Gain (loss) on asset dispositions and impairments, net                 14               (33 )     n/m      
        180               226           (20.4 )          

Income from continuing operations before taxes and

  noncontrolling interests

                331               370           (10.5 )    
        (44 )             (73 )         39.7             Income tax expense                 (96 )             (81 )         (18.5 )    
        136               153           (11.1 )           Income from continuing operations                 235               289           (18.7 )    
                                                  Discontinued Operations:                                                    
                                           

 Gain on dispositions, net of tax

                              1           (100.0 )    
$       136       $       153           (11.1 )           Net income attributable to Starwood         $       235       $       290           (19.0 )    
                                                  Earnings Per Share – Basic                                                    
$       0.80       $       0.81           (1.2 )           Continuing operations         $       1.38       $       1.52           (9.2 )    
                                            Discontinued operations                               0.01           (100.0 )    
$       0.80       $       0.81           (1.2 )           Net income         $       1.38       $       1.53           (9.8 )    
                                                  Earnings Per Share – Diluted                                                    
$       0.79       $       0.80           (1.3 )           Continuing operations         $       1.37       $       1.51           (9.3 )    
                                            Discontinued operations                               0.01           (100.0 )    
$       0.79       $       0.80           (1.3 )           Net income         $       1.37       $       1.52           (9.9 )    
        169               190                         Weighted average number of shares                 170               190                  
        170               191                         Weighted average number of shares assuming dilution                 171               191                  
                                                                                                       
(a)     The Company includes in revenues the reimbursement of costs incurred on behalf of managed hotel property owners and franchisees with no added margin and includes in costs and expenses these reimbursed costs. These costs relate primarily to payroll costs at managed properties where the Company is the employer.
n/m = not meaningful
 
     
STARWOOD HOTELS & RESORTS WORLDWIDE, INC.    
Consolidated Balance Sheets    
(In millions, except share data)    
     
           

June 30,

2015

         

December 31,

2014

     
            (unaudited)                    
Assets                                          
Current assets:                                          
Cash and cash equivalents           $         735           $ 935      
Restricted cash                     42             84      
Accounts receivable, net of allowance for doubtful accounts of $72 and $63                     675             661      
Inventories                     246             236      
Securitized vacation ownership notes receivable, net of allowance for

doubtful accounts of $3 and $4

                    44             47      
Deferred income taxes                     171             199      
Prepaid expenses and other                     182             159      
Total current assets                     2,095             2,321      
Investments                     204             214      
Plant, property and equipment, net                     2,320             2,634      
Goodwill and intangible assets, net                     1,912             1,956      
Deferred income taxes                     579             596      
Other assets (a)                     750             711      
Securitized vacation ownership notes receivable, net                     193             227      
Total assets           $         8,053           $ 8,659      
Liabilities and Stockholders’ Equity                                          
Current liabilities:                                          
Short-term borrowings and current maturities of long-term debt (b)           $         299           $ 297      
Accounts payable                     94             101      
Current maturities of long-term securitized vacation ownership debt                     57             73      
Accrued expenses                     1,324             1,307      
Accrued salaries, wages and benefits                     373             416      
Accrued taxes and other                     261             256      
Total current liabilities                     2,408             2,450      
Long-term debt (b)                     1,841             2,398      
Long-term securitized vacation ownership debt                     151             176      
Deferred income taxes                     35             38      
Other liabilities                     2,274             2,069      
Total liabilities                     6,709             7,131      
Commitments and contingencies                                          
Stockholders’ equity:                                          

Common stock; $0.01 par value; authorized 1,000,000,000 shares; 170,603,937

                                         
and 172,694,299 shares outstanding at June 30, 2015 and                                          
December 31, 2014, respectively                     2             2      
Additional paid-in capital                     74             47      
Accumulated other comprehensive loss                     (598 )           (508 )    
Retained earnings                     1,863             1,984      
Total Starwood stockholders’ equity                     1,341             1,525      
Noncontrolling interests                     3             3      
Total equity                     1,344             1,528      
Total liabilities and equity           $         8,053           $ 8,659      
                                           
(a)     Includes restricted cash of $3 million and $3 million at June 30, 2015 and December 31, 2014, respectively.
(b)     Excludes Starwood’s share of unconsolidated joint venture debt aggregating approximately $194 million and $200 million at June 30, 2015 and December 31, 2014, respectively.
       
   
STARWOOD HOTELS & RESORTS WORLDWIDE, INC.  
Non-GAAP to GAAP Reconciliations – Historical Data  
(In millions)  
   

Three Months Ended

June 30,

                   

Six Months Ended

June 30,

   
2015       2014      

%

Variance

                    2015       2014      

%

Variance

   
                                             

Reconciliation of Net Income to EBITDA

   and Adjusted EBITDA

                                               
$       136       $       153         (11.1 )         Net income         $       235       $       290         (19.0 )  
        32               27         18.5           Interest expense (a)                 67               54         24.1    
        44               73         (39.7 )         Income tax (benefit) expense (b)                 96               80         20.0    
        68               69         (1.4 )         Depreciation (c)                 136               135         0.7    
        8               8                   Amortization (d)                 15               16         (6.3 )  
        288               330         (12.7 )         EBITDA                 549               575         (4.5 )  
                      (3 )       100.0           (Gain) loss on asset dispositions and impairments, net                 (14 )             33       n/m    
        23               (3 )     n/m           Restructuring and other special charges (credits), net                 54               (3 )     n/m    
                                        Gain on sale of a unconsolidated joint venture hotel (e)                 (4 )                   n/m    
$       311       $       324         (4.0 )         Adjusted EBITDA         $       585       $       605         (3.3 )  
                                                                                               
(a)     Includes $4 million and $3 million of Starwood’s share of interest expense from unconsolidated joint ventures for the three months ended June 30, 2015 and 2014, respectively, and $7 million and $6 million for the six months ended June 30, 2015 and 2014, respectively.
(b)     Includes $0 million of tax expense (benefit) recorded in discontinued operations for the three months ended June 30, 2015 and 2014, and $0 million and $(1) million for the six months ended June 30, 2015 and 2014, respectively.
(c)     Includes $3 million and $6 million of Starwood’s share of depreciation expense from unconsolidated joint ventures for the three months ended June 30, 2015 and 2014, respectively, and $9 million and $12 million for the six months ended June 30, 2015 and 2014, respectively.
(d)     Includes $0 million and $1 million of Starwood’s share of amortization expense from unconsolidated joint ventures for the three months ended June 30, 2015 and 2014, respectively, and $0 million and $1 million for the six months ended June 30, 2015 and 2014, respectively.
(e)     The gain on sale is included in the equity earnings and gains from unconsolidated ventures, net line item in the statement of income.
n/m = not meaningful
 
     
STARWOOD HOTELS & RESORTS WORLDWIDE, INC.    

Non-GAAP to GAAP Reconciliations – Same-Store Owned Hotels Worldwide

   
(In millions)    
     
           

Three Months Ended

June 30, 2015

     
           

$  Change

        % Variance      
Revenue                                      
Revenue increase/(decrease) (GAAP)           $       (6 )         (2.0 )    
Impact of changes in foreign exchange rates                   29           9.3      
Revenue increase/(decrease) in constant dollars           $       23           7.3      
Expense                                      
Expense increase/(decrease) (GAAP)           $       (7 )         (3.0 )    
Impact of changes in foreign exchange rates                   20           8.6      
Expense increase/(decrease) in constant dollars           $       13           5.6      
                   
                   

Non-GAAP to GAAP Reconciliations – Same-Store Owned Hotels North America

   
(In millions)    
                   
           

Three Months Ended

June 30, 2015

     
           

$  Change

        % Variance      
Revenue                                      
Revenue increase/(decrease) (GAAP)           $       7           4.4      
Impact of changes in foreign exchange rates                   6           3.8      
Revenue increase/(decrease) in constant dollars           $       13           8.2      
Expense                                      
Expense increase/(decrease) (GAAP)           $       3           2.5      
Impact of changes in foreign exchange rates                   4           3.3      
Expense increase/(decrease) in constant dollars           $       7           5.8      
     
     

Non-GAAP to GAAP Reconciliations – Same-Store Owned Hotels International

   
(In millions)    
     
           

Three Months Ended

June 30, 2015

     
           

$  Change

        % Variance      

Revenue

                                     
Revenue increase/(decrease) (GAAP)           $       (13 )         (8.9 )    
Impact of changes in foreign exchange rates                   22           15.2      
Revenue increase/(decrease) in constant dollars           $       9           6.3      
Expense                                      
Expense increase/(decrease) (GAAP)           $       (11 )         (9.5 )    
Impact of changes in foreign exchange rates                   17           14.9      
Expense increase/(decrease) in constant dollars           $       6           5.4      
                                       
     
STARWOOD HOTELS & RESORTS WORLDWIDE, INC.    
Non-GAAP to GAAP Reconciliations – Future Performance    
(In millions, except per share data)    
     
            Low Case                  

Three Months Ended

September 30, 2015

                 

Year Ended

December 31, 2015

     
$ 118         Net income         $ 480      
  35         Interest expense           135      
  55         Income tax expense           217      
  77         Depreciation and amortization           307      
  285         EBITDA           1,139      
  -         Gain on asset dispositions and impairments, net           (14 )    
  -         Gain on sale of a unconsolidated joint venture hotel           (4 )    
  -         Restructuring and other special charges, net           54      
$ 285         Adjusted EBITDA         $ 1,175      
                               

Three Months Ended

September 30, 2015

                 

Year Ended

December 31, 2015

     
$ 118         Income from continuing operations before special items         $ 498      
$ 0.69         EPS before special items         $ 2.93      
            Special Items                  
  -         Restructuring and other special charges, net           (54 )    
  -         Gain on asset dispositions and impairments, net           14      
  -         Gain on sale of a unconsolidated joint venture hotel           4      
  -         Total special items – pre-tax           (36 )    
  -         Income tax benefit on special items           13      
  -         Income tax benefit – other non-recurring items           5      
  -         Total special items – after-tax           (18 )    
$ 118         Income from continuing operations         $ 480      
$ 0.69         EPS including special items         $ 2.82      
                               
                               
            High Case                  

Three Months Ended

September 30, 2015

                 

Year Ended

December 31, 2015

     
$ 124         Net income         $ 497      
  35         Interest expense           135      
  59         Income tax expense           225      
  77         Depreciation and amortization           307      
  295         EBITDA           1,164      
  -         Gain on asset dispositions and impairments, net           (14 )    
  -         Gain on sale of a unconsolidated joint venture hotel           (4 )    
  -         Restructuring and other special charges, net           54      
$ 295         Adjusted EBITDA         $ 1,200      
                               

Three Months Ended

September 30, 2015

                 

Year Ended

December 31, 2015

     
$ 124         Income from continuing operations before special items         $ 515      
$ 0.73         EPS before special items         $ 3.03      
            Special Items                  
  -         Restructuring and other special charges, net           (54 )    
  -         Gain on asset dispositions and impairments, net           14      
  -         Gain on sale of a unconsolidated joint venture hotel           4      
  -         Total special items – pre-tax           (36 )    
  -         Income tax benefit on special items           13      
  -         Income tax benefit – other non-recurring items           5      
  -         Total special items – after-tax           (18 )    
$ 124         Income from continuing operations         $ 497      
$ 0.73         EPS including special items         $ 2.93      
                               
 
STARWOOD HOTELS & RESORTS WORLDWIDE, INC.
Non-GAAP to GAAP Reconciliations – Same Store Owned Hotel Revenue and Expenses
(In millions)
 
                         

Three Months Ended

June 30,

                   

Six Months Ended

June 30,

 
2015       2014       %

Variance

         

Same-Store Owned Hotels

Worldwide

        2015     2014     %

Variance

 
                                              Revenue                                          
$       302       $       308         (2.0 )         Same-Store Owned Hotels (a)         $       547     $       546       0.2  
        34               83         (59.0 )         Hotels Sold or Closed in 2015 and 2014                 82             179       (54.2 )
        15               16         (6.3 )         Hotels Without Comparable Results                 34             40       (15.0 )
        5               7         (28.6 )         Other ancillary hotel operations                 9             13       (30.8 )
$       356       $       414         (14.0 )        

Total Owned, Leased and Consolidated Joint Venture

  Hotels Revenue

 

        $       672     $       778       (13.6 )
                                              Costs and Expenses                                          
$       232       $       239         3.0           Same-Store Owned Hotels (a)         $       447     $       450       0.6  
        21               57         63.2           Hotels Sold or Closed in 2015 and 2014                 50             124       59.7  
        8               11         27.3           Hotels Without Comparable Results                 22             28       21.4  
        4               7         42.9           Other ancillary hotel operations                 8             13       38.5  
$       265       $       314         15.6          

Total Owned, Leased and Consolidated Joint Venture

  Hotels Costs and Expenses

 

        $       527     $       615       14.3  
                                                                                         
                                                                                         

Three Months Ended

June 30,

                   

Six Months Ended

June 30,

 
2015       2014       %

Variance

         

Same-Store Owned Hotels

North America

        2015     2014     %

Variance

 
                                              Revenue                                          
$       166       $       159         4.4           Same-Store Owned Hotels (a)         $       318     $       303       4.9  
        30               36         (16.7 )         Hotels Sold or Closed in 2015 and 2014                 74             91       (18.7 )
        1                     n/m           Hotels Without Comparable Results                 1             1        
                                        Other ancillary hotel operations                                    
$       197       $       195         1.0          

Total Owned, Leased and Consolidated Joint Venture

  Hotels Revenue

 

        $       393     $       395       (0.5 )
                                              Costs and Expenses                                          
$       132       $       128         (2.5 )         Same-Store Owned Hotels (a)         $       261     $       254       (3.1 )
        19               27         29.6           Hotels Sold or Closed in 2015 and 2014                 45             62       27.4  
        1               1                   Hotels Without Comparable Results                 1             1        
                                        Other ancillary hotel operations                                    
$       152       $       156         2.6          

Total Owned, Leased and Consolidated Joint Venture

  Hotels Costs and Expenses

 

        $       307     $       317       3.2  
                                                                                         
                                                                                         

Three Months Ended

June 30,

                   

Six Months Ended

June 30

 
2015       2014       %

Variance

         

Same-Store Owned Hotels

International

        2015     2014     %

Variance

 
                                              Revenue                                          
$       136       $       149         (8.9 )         Same-Store Owned Hotels (a)         $       229     $       243       (5.7 )
        4               47         (91.5 )         Hotels Sold or Closed in 2015 and 2014                 8             88       (90.9 )
        14               16         (12.5 )         Hotels Without Comparable Results                 33             39       (15.4 )
        5               7         (28.6 )         Other ancillary hotel operations                 9             13       (30.8 )
$       159       $       219         (27.4 )        

Total Owned, Leased and Consolidated Joint Venture

  Hotels Revenue

 

        $       279     $       383       (27.2 )
                                              Costs and Expenses                                          
$       100       $       111         9.5           Same-Store Owned Hotels (a)         $       186     $       196       5.4  
        2               30         93.3           Hotels Sold or Closed in 2015 and 2014                 5             62       91.9  
        7               10         30.0           Hotels Without Comparable Results                 21             27       22.2  
        4               7         42.9           Other ancillary hotel operations                 8             13       38.5  
$       113       $       158         28.5          

Total Owned, Leased and Consolidated Joint Venture

  Hotels Costs and Expenses

 

        $       220     $       298       26.2  
                                                                                         
(a)     Same-Store Owned Hotel results exclude 11 hotels sold or closed, two leased hotels converted to managed or franchised hotels and two hotels without comparable results for the three months ended June 30, 2015 and 12 hotels sold or closed, two leased hotels converted to managed or franchised hotels and three hotels without comparable results for the six months ended June 30, 2015.
       
     
STARWOOD HOTELS & RESORTS WORLDWIDE, INC.    

Systemwide(1) Statistics - Same Store

   
For the Three Months Ended June 30,    
UNAUDITED    
     
            Systemwide - Worldwide             Systemwide - North America             Systemwide - International      
            2015             2014         Var. USD             2015             2014         Var. USD             2015             2014         Var. USD      
TOTAL HOTELS                                                                                                                                        
REVPAR ($)             124.87               125.72           -0.7 %             140.96               135.38           4.1 %             107.83               115.47           -6.6 %    
ADR ($)             172.88               177.49           -2.6 %             180.04               174.70           3.1 %             163.86               181.07           -9.5 %    
Occupancy (%)             72.2 %             70.8 %         1.4               78.3 %             77.5 %         0.8               65.8 %             63.8 %         2.0      
                                                                                                                                         
SHERATON                                                                                                                                        
REVPAR ($)             104.16               105.77           -1.5 %             120.35               115.90           3.8 %             87.57               95.38           -8.2 %    
ADR ($)             148.27               152.76           -2.9 %             157.43               152.79           3.0 %             137.03               152.72           -10.3 %    
Occupancy (%)             70.3 %             69.2 %         1.1               76.4 %             75.9 %         0.5               63.9 %             62.5 %         1.4      
                                                                                                                                         
WESTIN                                                                                                                                        
REVPAR ($)             145.90               143.60           1.6 %             153.07               146.63           4.4 %             132.24               137.83           -4.1 %    
ADR ($)             189.48               190.37           -0.5 %             191.42               185.79           3.0 %             185.34               200.35           -7.5 %    
Occupancy (%)             77.0 %             75.4 %         1.6               80.0 %             78.9 %         1.1               71.3 %             68.8 %         2.5      
                                                                                                                                         
ST. REGIS/LUXURY COLLECTION                                                                                                                                        
REVPAR ($)             201.75               207.46           -2.8 %             278.86               267.89           4.1 %             174.91               186.32           -6.1 %    
ADR ($)             301.66               318.60           -5.3 %             383.46               362.66           5.7 %             269.73               300.24           -10.2 %    
Occupancy (%)             66.9 %             65.1 %         1.8               72.7 %             73.9 %         -1.2               64.8 %             62.1 %         2.7      
                                                                                                                                         
LE MERIDIEN                                                                                                                                        
REVPAR ($)             131.30               140.44           -6.5 %             228.20               220.26           3.6 %             114.45               126.56           -9.6 %    
ADR ($)             186.41               201.65           -7.6 %             267.71               259.58           3.1 %             168.66               188.90           -10.7 %    
Occupancy (%)             70.4 %             69.6 %         0.8               85.2 %             84.9 %         0.3               67.9 %             67.0 %         0.9      
                                                                                                                                         
W                                                                                                                                        
REVPAR ($)             241.46               240.23           0.5 %             251.57               241.11           4.3 %             223.37               238.66           -6.4 %    
ADR ($)             299.30               302.42           -1.0 %             296.26               289.06           2.5 %             305.61               329.86           -7.4 %    
Occupancy (%)             80.7 %             79.4 %         1.3               84.9 %             83.4 %         1.5               73.1 %             72.4 %         0.7      
                                                                                                                                         
FOUR POINTS                                                                                                                                        
REVPAR ($)             77.37               77.82           -0.6 %             90.02               89.34           0.8 %             62.90               64.63           -2.7 %    
ADR ($)             110.70               114.45           -3.3 %             117.76               118.33           -0.5 %             100.81               108.79           -7.3 %    
Occupancy (%)             69.9 %             68.0 %         1.9               76.4 %             75.5 %         0.9               62.4 %             59.4 %         3.0      
                                                                                                                                         
ALOFT                                                                                                                                        
REVPAR ($)             86.92               80.13           8.5 %             110.66               101.71           8.8 %             48.18               44.94           7.2 %    
ADR ($)             117.47               114.67           2.4 %             137.11               129.02           6.3 %             76.44               81.30           -6.0 %    
Occupancy (%)             74.0 %             69.9 %         4.1               80.7 %             78.8 %         1.9               63.0 %             55.3 %         7.7      
                                                                                                                                         
(1)    

Includes same-store Owned, managed and franchised hotels.

       
     
STARWOOD HOTELS & RESORTS WORLDWIDE, INC.    
Worldwide Hotel Results - Same Store    
For the Three Months Ended June 30,    
UNAUDITED    
     
            Systemwide (1)                 Company Operated (2)      
            2015             2014           Var. USD                 2015             2014           Var. USD      
TOTAL WORLDWIDE                                                                                                    
REVPAR ($)             124.87               125.72             -0.7 %                 137.42               140.00             -1.8 %    
ADR ($)             172.88               177.49             -2.6 %                 193.34               201.23             -3.9 %    
Occupancy (%)             72.2 %             70.8 %           1.4                   71.1 %             69.6 %           1.5      
                                                                                                     
AMERICAS                                                                                                    
REVPAR ($)             136.22               131.44             3.6 %                 172.68               166.99             3.4 %    
ADR ($)             178.07               174.05             2.3 %                 222.99               217.81             2.4 %    
Occupancy (%)             76.5 %             75.5 %           1.0                   77.4 %             76.7 %           0.7      
                                                                                                     
North America                                                                                                    
REVPAR ($)             140.96               135.38             4.1 %                 180.98               174.29             3.8 %    
ADR ($)             180.04               174.70             3.1 %                 227.07               220.47             3.0 %    
Occupancy (%)             78.3 %             77.5 %           0.8                   79.7 %             79.1 %           0.6      
                                                                                                     
Latin America                                                                                                    
REVPAR ($)             90.84               93.86             -3.2 %                 107.40               109.61             -2.0 %    
ADR ($)             153.19               165.46             -7.4 %                 180.17               189.27             -4.8 %    
Occupancy (%)             59.3 %             56.7 %           2.6                   59.6 %             57.9 %           1.7      
                                                                                                     
ASIA PACIFIC                                                                                                    
REVPAR ($)             92.22               93.18             -1.0 %                 93.94               94.11             -0.2 %    
ADR ($)             143.27               151.07             -5.2 %                 145.30               152.44             -4.7 %    
Occupancy (%)             64.4 %             61.7 %           2.7                   64.7 %             61.7 %           3.0      
                                                                                                     
Greater China                                                                                                    
REVPAR ($)             86.07               86.02             0.1 %                 85.44               85.06             0.4 %    
ADR ($)             139.35               144.84             -3.8 %                 137.82               143.01             -3.6 %    
Occupancy (%)             61.8 %             59.4 %           2.4                   62.0 %             59.5 %           2.5      
                                                                                                     
Rest of Asia Pacific                                                                                                    
REVPAR ($)             101.42               103.87             -2.4 %                 113.34               114.73             -1.2 %    
ADR ($)             148.58               159.55             -6.9 %                 160.26               171.57             -6.6 %    
Occupancy (%)             68.3 %             65.1 %           3.2                   70.7 %             66.9 %           3.8      
                                                                                                     
EAME                                                                                                    
REVPAR ($)             136.20               155.31             -12.3 %                 143.72               163.59             -12.1 %    
ADR ($)             194.71               224.86             -13.4 %                 205.01               235.44             -12.9 %    
Occupancy (%)             69.9 %             69.1 %           0.8                   70.1 %             69.5 %           0.6      
                                                                                                     
Europe                                                                                                    
REVPAR ($)             147.86               171.87             -14.0 %                 164.41               190.88             -13.9 %    
ADR ($)             199.78               239.00             -16.4 %                 216.90               259.59             -16.4 %    
Occupancy (%)             74.0 %             71.9 %           2.1                   75.8 %             73.5 %           2.3      
                                                                                                     
Africa & Middle East                                                                                                    
REVPAR ($)             114.93               125.19             -8.2 %                 115.16               126.06             -8.6 %    
ADR ($)             183.78               195.92             -6.2 %                 185.03               197.22             -6.2 %    
Occupancy (%)             62.5 %             63.9 %           -1.4                   62.2 %             63.9 %           -1.7      
                                                                                                     
(1)     Includes same-store Owned, managed, and franchised hotels.
(2)     Includes same-store Owned and managed hotels.
       
     
STARWOOD HOTELS & RESORTS WORLDWIDE, INC.    
Owned Hotel Results - Same Store    
For the Three Months Ended June 30,    
UNAUDITED    
     
            Worldwide             North America             International      
            2015             2014           Var. USD             2015             2014           Var. USD             2015             2014           Var. USD      
TOTAL HOTELS           31 Hotels             11 Hotels             20 Hotels      
REVPAR ($)             185.60               190.53             -2.6 %             189.85               181.15             4.8 %             180.69               201.38             -10.3 %    
ADR ($)             239.13               252.24             -5.2 %             235.78               229.60             2.7 %             243.33               281.04             -13.4 %    
Occupancy (%)             77.6 %             75.5 %           2.1               80.5 %             78.9 %           1.6               74.3 %             71.7 %           2.6      
                                                                                                                                               
Total Revenue*             301,993          

 

  308,302             -2.0 %             165,989               158,962             4.4 %             136,003               149,340             -8.9 %    
Total Expenses*             232,053               239,351             3.0 %             131,676               128,469             -2.5 %             100,377               110,882             9.5 %    
*       Revenues and Expenses above are represented in '000s
         
     
STARWOOD HOTELS & RESORTS WORLDWIDE, INC.    
Management Fees, Franchise Fees and Other Income    
For the Three Months Ended June 30,    
UNAUDITED ($ millions)    
     
            Worldwide      
            2015             2014           Variance           % Variance      
Management Fees                                                                      
Base Fees                 93                 98             (5 )           (5.1 )%    
Incentive Fees                 46                 48             (2 )           (4.2 )%    
Total Management Fees                 139                 146             (7 )           (4.8 )%    
                                                                       
Franchise Fees                 67                 62             5             8.1 %    
                                                                       
Total Management and Franchise Fees (Core Fees)                 206                 208             (2 )           (1.0 )%    
                                                                       
Other Management and Franchise Revenues (1)                 46                 48             (2 )           (4.2 )%    
                                                                       
Total Management and Franchise Revenues                 252                 256             (4 )           (1.6 )%    
                                                                       
Other                 4                 4             -             -      
                                                                       
Management Fees, Franchise Fees and Other Income                 256                 260             (4 )           (1.5 )%    
                                                                       
(1)     Other Management and Franchise Revenues includes the amortization of the deferred gains of approximately $22 million in 2015 and 2014 resulting from the sales of hotels subject to long-term management contracts and termination fees.
       
     
STARWOOD HOTELS & RESORTS WORLDWIDE, INC.    
Vacation Ownership and Residential Revenues and Expenses    
For the Three Months Ended June 30,    
UNAUDITED ($ millions)    
     
                2015               2014           $ Variance           % Variance      
Originated Sales Revenues (1) — Vacation Ownership Sales                 79                   79                                
Other Sales and Services Revenues (2)                 91                   85               6             7.1 %    
Deferred Revenues — Percentage of Completion                 3                   (2 )             5           n/m      
Deferred Revenues — Other (3)                 (4 )                 (2 )             (2 )           (100.0 %)    
Vacation Ownership Sales and Services Revenues                 169                   160               9             5.6 %    
Residential Sales and Services Revenues (4)                 1                   11               (10 )           (90.9 %)    

Total Vacation Ownership & Residential Sales and Services

   Revenues

                170                   171               (1 )           (0.6 %)    
                                                                           
Originated Sales Expenses (5) — Vacation Ownership Sales                 57                   55               (2 )           (3.6 %)    
Other Expenses (6)                 66                   64               (2 )           (3.1 %)    
Deferred Expenses — Percentage of Completion                 1                   (2 )             (3 )         n/m      
Deferred Expenses — Other                 2                   2                                
Vacation Ownership Expenses                 126                   119               (7 )           (5.9 %)    
Residential Expenses (4)                                   6               6             100.0 %    
Total Vacation Ownership & Residential Expenses                 126                   125               (1 )           (0.8 %)    
                                                                           
(1)     Timeshare sales revenue originated at each sales location before deferrals of revenue for U.S. GAAP reporting purposes.
(2)     Includes resort income, interest income, and miscellaneous other revenues.
(3)     Includes deferral of revenue for contracts still in rescission period, contracts that do not yet meet the requirements of ASC 978-605-25 and provision for loan loss.
(4)     For 2015 and 2014, includes $0 and $7 million of revenues and $0 and $6 million expenses associated with the St. Regis Bal Harbour residential project, respectively.
(5)     Timeshare cost of sales and sales and marketing expenses before deferrals of sales expenses for U.S. GAAP reporting purposes.
(6)     Includes resort, general and administrative, and other miscellaneous expenses.
Note: Deferred revenue is calculated based on the Percentage of Completion ("POC") of the project. Deferred expenses, also based on POC, include product costs and direct sales and marketing costs only. Indirect sales and marketing costs are not deferred per ASC 978-720-25 and ASC 978-340-25.
 
n/m = not meaningful
 
     
STARWOOD HOTELS & RESORTS WORLDWIDE, INC.    

Systemwide(1) Statistics - Same Store

   
For the Six Months Ended June 30,    
UNAUDITED    
     
            Systemwide - Worldwide             Systemwide - North America             Systemwide - International      
            2015           2014           Var. USD             2015           2014         Var. USD             2015           2014         Var. USD      
TOTAL HOTELS                                                                                                                                      
REVPAR ($)             120.63               120.12             0.4 %             133.14             126.91           4.9 %             107.44             112.95           -4.9 %    
ADR ($)             172.84               176.40             -2.0 %             177.52             172.23           3.1 %             167.09             181.60           -8.0 %    
Occupancy (%)             69.8 %             68.1 %           1.7               75.0 %           73.7 %         1.3               64.3 %           62.2 %         2.1      
                                                                                                                                       
SHERATON                                                                                                                                      
REVPAR ($)             100.36               101.38             -1.0 %             112.41             107.82           4.3 %             88.18             94.87           -7.1 %    
ADR ($)             147.94               151.95             -2.6 %             153.72             149.38           2.9 %             141.10             155.02           -9.0 %    
Occupancy (%)             67.8 %             66.7 %           1.1               73.1 %           72.2 %         0.9               62.5 %           61.2 %         1.3      
                                                                                                                                       
WESTIN                                                                                                                                      
REVPAR ($)             139.69               135.98             2.7 %             144.16             136.87           5.3 %             131.16             134.27           -2.3 %    
ADR ($)             187.42               187.41             0.0 %             188.24             182.54           3.1 %             185.72             197.67           -6.0 %    
Occupancy (%)             74.5 %             72.6 %           1.9               76.6 %           75.0 %         1.6               70.6 %           67.9 %         2.7      
                                                                                                                                       
ST. REGIS/LUXURY COLLECTION                                                                                                                                      
REVPAR ($)             205.48               206.55             -0.5 %             296.05             281.01           5.4 %             172.53             179.38           -3.8 %    
ADR ($)             310.68               322.38             -3.6 %             401.26             382.48           4.9 %             272.31             295.81           -7.9 %    
Occupancy (%)             66.1 %             64.1 %           2.0               73.8 %           73.5 %         0.3               63.4 %           60.6 %         2.8      
                                                                                                                                       
LE MERIDIEN                                                                                                                                      
REVPAR ($)             123.77               130.39             -5.1 %             200.15             194.20           3.1 %             111.32             119.99           -7.2 %    
ADR ($)             185.01               198.57             -6.8 %             247.62             243.71           1.6 %             172.25             189.32           -9.0 %    
Occupancy (%)             66.9 %             65.7 %           1.2               80.8 %           79.7 %         1.1               64.6 %           63.4 %         1.2      
                                                                                                                                       
W                                                                                                                                      
REVPAR ($)             238.10               233.53             2.0 %             243.75             232.20           5.0 %             228.71             235.73           -3.0 %    
ADR ($)             301.00               303.75             -0.9 %             296.89             288.67           2.8 %             308.56             332.13           -7.1 %    
Occupancy (%)             79.1 %             76.9 %           2.2               82.1 %           80.4 %         1.7               74.1 %           71.0 %         3.1      
                                                                                                                                       
FOUR POINTS                                                                                                                                      
REVPAR ($)             74.46               73.87             0.8 %             84.11             81.53           3.2 %             63.48             65.16           -2.6 %    
ADR ($)             111.52               114.30             -2.4 %             116.16             115.22           0.8 %             105.19             113.02           -6.9 %    
Occupancy (%)             66.8 %             64.6 %           2.2               72.4 %           70.8 %         1.6               60.3 %           57.7 %         2.6      
                                                                                                                                       
ALOFT                                                                                                                                      
REVPAR ($)             83.25               75.18             10.7 %             103.66             93.89           10.4 %             49.55             44.31           11.8 %    
ADR ($)             116.85               113.00             3.4 %             134.75             125.63           7.3 %             80.11             83.59           -4.2 %    
Occupancy (%)             71.2 %             66.5 %           4.7               76.9 %           74.7 %         2.2               61.9 %           53.0 %         8.9      
                                                                                                                                       
(1)     Includes same-store Owned, managed and franchised hotels.
       
     
STARWOOD HOTELS & RESORTS WORLDWIDE, INC.    
Worldwide Hotel Results - Same Store    
For the Six Months Ended June 30,    
UNAUDITED    
     
            Systemwide (1)             Company Operated (2)      
            2015             2014         Var. USD             2015           2014         Var. USD      
TOTAL WORLDWIDE                                                                                          
REVPAR ($)             120.63               120.12           0.4 %             134.37             135.11           -0.5 %    
ADR ($)             172.84               176.40           -2.0 %             194.47             200.84           -3.2 %    
Occupancy (%)             69.8 %             68.1 %         1.7               69.1 %           67.3 %         1.8      
                                                                                           
AMERICAS                                                                                          
REVPAR ($)             130.29               124.54           4.6 %             166.95             159.99           4.4 %    
ADR ($)             176.63               172.26           2.5 %             221.58             216.40           2.4 %    
Occupancy (%)             73.8 %             72.3 %         1.5               75.3 %           73.9 %         1.4      
                                                                                           
North America                                                                                          
REVPAR ($)             133.14               126.91           4.9 %             172.59             165.22           4.5 %    
ADR ($)             177.52               172.23           3.1 %             224.39             218.50           2.7 %    
Occupancy (%)             75.0 %             73.7 %         1.3               76.9 %           75.6 %         1.3      
                                                                                           
Latin America                                                                                          
REVPAR ($)             103.17               101.92           1.2 %             122.79             119.00           3.2 %    
ADR ($)             166.39               172.65           -3.6 %             194.77             195.95           -0.6 %    
Occupancy (%)             62.0 %             59.0 %         3.0               63.0 %           60.7 %         2.3      
                                                                                           
ASIA PACIFIC                                                                                          
REVPAR ($)             95.07               96.05           -1.0 %             96.94             97.25           -0.3 %    
ADR ($)             149.03               156.79           -4.9 %             152.03             159.43           -4.6 %    
Occupancy (%)             63.8 %             61.3 %         2.5               63.8 %           61.0 %         2.8      
                                                                                           
Greater China                                                                                          
REVPAR ($)             86.35               87.29           -1.1 %             85.64             86.35           -0.8 %    
ADR ($)             143.88               151.42           -5.0 %             142.42             149.82           -4.9 %    
Occupancy (%)             60.0 %             57.6 %         2.4               60.1 %           57.6 %         2.5      
                                                                                           
Rest of Asia Pacific                                                                                          
REVPAR ($)             108.12               109.16           -1.0 %             123.26             122.62           0.5 %    
ADR ($)             155.71               163.74           -4.9 %             170.64             178.16           -4.2 %    
Occupancy (%)             69.4 %             66.7 %         2.7               72.2 %           68.8 %         3.4      
                                                                                           
EAME                                                                                          
REVPAR ($)             127.38               141.86           -10.2 %             135.92             150.30           -9.6 %    
ADR ($)             193.63               219.59           -11.8 %             204.05             229.44           -11.1 %    
Occupancy (%)             65.8 %             64.6 %         1.2               66.6 %           65.5 %         1.1      
                                                                                           
Europe                                                                                          
REVPAR ($)             126.64               145.01           -12.7 %             140.20             159.45           -12.1 %    
ADR ($)             188.23               223.53           -15.8 %             202.46             239.73           -15.5 %    
Occupancy (%)             67.3 %             64.9 %         2.4               69.2 %           66.5 %         2.7      
                                                                                           
Africa & Middle East                                                                                          
REVPAR ($)             128.81               135.83           -5.2 %             129.72             137.10           -5.4 %    
ADR ($)             204.68               211.95           -3.4 %             206.58             214.05           -3.5 %    
Occupancy (%)             62.9 %             64.1 %         -1.2               62.8 %           64.1 %         -1.3      
                                                                                           
(1)     Includes same-store Owned, managed, and franchised hotels.
(2)     Includes same-store Owned and managed hotels.
       
     
STARWOOD HOTELS & RESORTS WORLDWIDE, INC.    
Owned Hotel Results - Same Store    
For the Six Months Ended June 30,    
UNAUDITED    
     
            Worldwide             North America             International      
            2015             2014         Var. USD             2015             2014         Var. USD             2015             2014         Var. USD      
TOTAL HOTELS           30 Hotels             11 Hotels             19 Hotels      
REVPAR ($)             170.04               170.88           -0.5 %             180.22               172.72           4.3 %             157.76               168.67           -6.5 %    
ADR ($)             228.42               238.49           -4.2 %             233.21               229.89           1.4 %             222.13               250.03           -11.2 %    
Occupancy (%)             74.4 %             71.7 %         2.7               77.3 %             75.1 %         2.2               71.0 %             67.5 %         3.5      
                                                                                                                                         
Total Revenue*             547,083          

 

  545,847           0.2 %             317,983               303,019           4.9 %             229,100               242,828           -5.7 %    
Total Expenses*             447,373               449,947           0.6 %             261,633               253,707           -3.1 %             185,740               196,240           5.4 %    
*       Revenues and Expenses above are represented in '000s
         
     
STARWOOD HOTELS & RESORTS WORLDWIDE, INC.    
Management Fees, Franchise Fees and Other Income    
For the Six Months Ended June 30,    
UNAUDITED ($ millions)    
                 
          Worldwide      
          2015         2014         Variance        

%

Variance

     
Management Fees                                                                
Base Fees                 178               184           (6 )         (3.3 )%    
Incentive Fees                 94               97           (3 )         (3.1 )%    
Total Management Fees                 272               281           (9 )         (3.2 )%    
                                                                 
Franchise Fees                 125               115           10           8.7 %    
Total Management and Franchise Fees (Core Fees)                 397               396           1           0.3 %    
                                                                 
Other Management and Franchise Revenues (1)                 91               101           (10 )         (9.9 )%    
Total Management and Franchise Revenues                 488               497           (9 )         (1.8 )%    
                                                                 
Other                 8               11           (3 )         (27.3 )%    
Management Fees, Franchise Fees and Other Income                 496               508           (12 )         (2.4 )%    
                                                                 
(1)     Other Management and Franchise Revenues includes the amortization of the deferred gains of approximately $44 million in 2015 and $43 million in 2014 resulting from the sales of hotels subject to long-term management contracts and termination fees.
       
     
STARWOOD HOTELS & RESORTS WORLDWIDE, INC.    
Vacation Ownership and Residential Revenues and Expenses    
For the Six Months Ended June 30,    
UNAUDITED ($ millions)    
     
                2015                 2014             $ Variance         % Variance    
Originated Sales Revenues (1) – Vacation Ownership Sales                 162                   163               (1 )           (0.6 %)    
Other Sales and Services Revenues (2)                 191                   172               19             11.0 %    
Deferred Revenues – Percentage of Completion                 4                   (16 )             20           n/m      
Deferred Revenues – Other (3)                 (2 )                               (2 )         n/m      
Vacation Ownership Sales and Services Revenues                 355                   319               36             11.3 %    
Residential Sales and Services Revenues (4)                 2                   26               (24 )           (92.3 %)    

Total Vacation Ownership and Residential Sales and Services

   Revenues

                357                   345               12             3.5 %    
                                                                           
Originated Sales Expenses (5) – Vacation Ownership Sales                 121                   121                                
Other Expenses (6)                 135                   128               (7 )           (5.5 %)    
Deferred Expenses – Percentage of Completion                 2                   (10 )             (12 )         n/m      
Deferred Expenses – Other                 5                   5                                
Vacation Ownership Expenses                 263                   244               (19 )           (7.8 %)    
Residential Expenses (4)                                   9               9             100.0 %    
Total Vacation Ownership and Residential Expenses                 263                   253               (10 )           (4.0 %)    
                                                                           
       
(1)     Timeshare sales revenue originated at each sales location before deferrals of revenue for U.S. GAAP reporting purposes.
(2)     Includes resort income, interest income, and miscellaneous other revenues.
(3)     Includes deferral of revenue for contracts still in rescission period, contracts that do not yet meet the requirements of ASC 978-605-25 and provision for loan loss.
(4)     For 2015 and 2014, includes $0 and $20 million of revenues and $0 and $9 million expenses associated with the St. Regis Bal Harbour residential project, respectively.
(5)     Timeshare cost of sales and sales and marketing expenses before deferrals of sales expenses for U.S. GAAP reporting purposes.
(6)     Includes resort, general and administrative, and other miscellaneous expenses.
Note: Deferred revenue is calculated based on the Percentage of Completion ("POC") of the project. Deferred expenses, also based on POC, include product costs and direct sales and marketing costs only. Indirect sales and marketing costs are not deferred per ASC 978-720-25 and ASC 978-340-25.
 
n/m = not meaningful
 
         
STARWOOD HOTELS & RESORTS WORLDWIDE, INC.    
Owned Hotels without Comparable Results and Other Selected Items    
As of June 30, 2015    
UNAUDITED ($ millions)    
                       

 

Owned Hotels without comparable results in 2015 and 2014:

                     
                       

Hotel

           

Location

   
The Westin Excelsior, Florence             Florence, Italy    
The Westin Resort & Spa, Los Cabos             Los Cabos, Mexico    
Sheraton Maria Isabel Hotel & Towers             Mexico City, Mexico    
               
               

Owned Hotels sold in 2015 and 2014:

             
               

Hotel

       

Location

   
Aloft Philadelphia Airport         Philadelphia, PA    
Aloft Tucson University         Tucson, AZ    
Element Denver Park Meadows         Denver, CO    
Four Points by Sheraton Philadelphia Airport         Philadelphia, PA    
Sheraton Ambassador Hotel         Monterrey, Mexico    
Sheraton on the Park         Sydney, Australia    
Sheraton Santa Maria de El Paular         Madrid, Spain    
Sheraton Suites Philadelphia Airport         Philadelphia, PA    
The Gritti Palace, a Luxury Collection Hotel, Venice         Venice, Italy    
The Park Lane Hotel         London, England    
The Phoenician, a Luxury Collection Resort, Scottsdale         Scottsdale, AZ    
The St. Regis Bal Harbour Resort         Miami Beach, FL    
The St. Regis Rome         Rome, Italy    
The Westin Dublin Hotel         Dublin, Ireland    
               
         

Revenues and Expenses Associated with Hotels Sold in 2015 and 2014: (1)

     
         
                  Q1           Q2             Q3           Q4           Full Year      
Hotels Sold in 2014:                                                                                                                            
2014                                                                                                                            
Revenues                 $         50           $         44             $         37           $         20           $         151      
Expenses (excluding depreciation)                 $         38           $         31             $         27           $         12           $         108      
                                                                                                                             
Hotels Sold in 2015:                                                                                                                            
2015                                                                                                                            
Revenues                 $         48           $         34                                                     $         82      
Expenses (excluding depreciation)                 $         29           $         21                                                     $         50      
                                                                                                                             
2014                                                                                                                            
Revenues                 $         46           $         39             $         24           $         34           $         143      
Expenses (excluding depreciation)                 $         29           $         26             $         22           $         26           $         103      
                                                                                                                             
(1)     Results consist of nine hotels sold or closed in 2014, two leased hotels converted to managed or franchised hotels in 2014, and three hotels sold in 2015. These amounts are included in the revenues and expenses from owned, leased, and consolidated joint venture hotels in the statements of income for 2015 and 2014.
       
         
STARWOOD HOTELS & RESORTS WORLDWIDE, INC.        
Capital Expenditures        
For the Three and Six Months Ended June 30, 2015        
UNAUDITED ($ millions)        
         
                Q2                 YTD        
Maintenance Capital Expenditures: (1)                                              
Owned, Leased and Consolidated Joint Venture Hotels                 15                   27        
Corporate/IT                 22                   40        
Subtotal                 37                   67        
                                               
Net capital expenditures for Vacation Ownership inventory (2)                 8                   17        
                                               
Development Capital                 38                   72        
                                               
Total Capital Expenditures                 83                   156        
(1)     Maintenance capital expenditures include improvements that extend the useful life of the asset.
(2)     Represents gross inventory capital expenditures of $24 million and $55 million in the three and six months ended June 30, 2015, less cost of sales of $16 million and $38 million in the three and six months ended June 30, 2015.
       
     
STARWOOD HOTELS & RESORTS WORLDWIDE, INC.    
Divisional Hotel Inventory Summary by Ownership by Brand    
As of June 30, 2015    
     
      Americas       North America       Latin America       Asia Pacific       Greater China       Rest of Asia      

Europe, Africa &

Middle East

      Europe      

Africa &

Middle East

      TOTAL    
      Hotels     Rooms       Hotels     Rooms       Hotels     Rooms       Hotels     Rooms       Hotels     Rooms       Hotels     Rooms       Hotels     Rooms       Hotels     Rooms       Hotels     Rooms       Hotels     Rooms    
Owned                                                                                                                                              
Sheraton     9     5,792       5     3,328       4     2,464       1     297                 1     297       2     358       2     358                 12     6,447    
Westin     5     2,734       2     1,832       3     902       1     246                 1     246       2     487       2     487                 8     3,467    
Four Points                                                                                                      
W     1     509       1     509                                               2     665       2     665                 3     1,174    
Luxury Collection     1     180                 1     180                                     4     495       4     495                 5     675    
St. Regis     2     498       2     498                 1     160                 1     160       1     100       1     100                 4     758    
Le Meridien                                                                                                      
Aloft                                                                                                      
Element                                                                                                      
Other     1     135       1     135                                                                             1     135    
Total Owned     19     9,848       11     6,302       8     3,546       3     703                 3     703       11     2,105       11     2,105                 33     12,656    
                                                                                                                                               
Managed & UJV                                                                                                                                              
Sheraton     47     27,024       29     23,095       18     3,929       96     36,391       65     27,949       31     8,442       74     21,255       42     11,880       32     9,375       217     84,670    
Westin     52     26,859       49     25,973       3     886       37     12,450       20     7,047       17     5,403       14     4,790       9     3,451       5     1,339       103     44,099    
Four Points     5     672       1     134       4     538       32     9,071       22     6,629       10     2,442       13     2,568       5     673       8     1,895       50     12,311    
W     28     8,311       24     7,554       4     757       10     2,740       4     1,464       6     1,276       5     941       4     499       1     442       43     11,992    
Luxury Collection     12     2,581       5     2,291       7     290       12     2,478       6     1,306       6     1,172       27     4,891       22     3,301       5     1,590       51     9,950    
St. Regis     12     2,332       9     1,884       3     448       9     2,309       6     1,659       3     650       9     1,973       5     806       4     1,167       30     6,614    
Le Meridien     5     879       4     719       1     160       31     8,147       9     3,131       22     5,016       41     12,194       14     4,694       27     7,500       77     21,220    
Aloft                                   12     3,071       9     2,101       3     970       4     943       3     535       1     408       16     4,014    
Element                                   1     188       1     188                                               1     188    
Other                                                                 1     250                 1     250       1     250    
Total Managed & UJV     161     68,658       121     61,650       40     7,008       240     76,845       142     51,474       98     25,371       188     49,805       104     25,839       84     23,966       589     195,308    
                                                                                                                                               
Franchised                                                                                                                                              
Sheraton     177     51,435       162     47,748       15     3,687       12     5,841       3     1,836       9     4,005       22     5,458       19     4,880       3     578       211     62,734    
Westin     76     24,509       69     22,224       7     2,285       8     2,531       1     288       7     2,243       7     1,985       7     1,985                 91     29,025    
Four Points     132     20,029       117     17,932       15     2,097       11     1,804       1     126       10     1,678       7     1,085       7     1,085                 150     22,918    
W                                                                                                      
Luxury Collection     13     2,177       9     1,691       4     486       12     3,212                 12     3,212       13     2,003       13     2,003                 38     7,392    
St. Regis                                                                                                      
Le Meridien     17     3,864       16     3,753       1     111       5     1,209       1     160       4     1,049       3     575       3     575                 25     5,648    
Aloft     71     10,806       66     9,892       5     914       6     1,001                 6     1,001       1     116       1     116                 78     11,923    
Element     16     2,489       16     2,489                                               1     133       1     133                 17     2,622    
Other     2     513       2     513                                                                             2     513    
Total Franchised     504     115,822       457     106,242       47     9,580       54     15,598       6     2,410       48     13,188       54     11,355       51     10,777       3     578       612     142,775    
                                                                                                                                               
Systemwide                                                                                                                                              
Sheraton     233     84,251       196     74,171       37     10,080       109     42,529       68     29,785       41     12,744       98     27,071       63     17,118       35     9,953       440     153,851    
Westin     133     54,102       120     50,029       13     4,073       46     15,227       21     7,335       25     7,892       23     7,262       18     5,923       5     1,339       202     76,591    
Four Points     137     20,701       118     18,066       19     2,635       43     10,875       23     6,755       20     4,120       20     3,653       12     1,758       8     1,895       200     35,229    
W     29     8,820       25     8,063       4     757       10     2,740       4     1,464       6     1,276       7     1,606       6     1,164       1     442       46     13,166    
Luxury Collection     26     4,938       14     3,982       12     956       24     5,690       6     1,306       18     4,384       44     7,389       39     5,799       5     1,590       94     18,017    
St. Regis     14     2,830       11     2,382       3     448       10     2,469       6     1,659       4     810       10     2,073       6     906       4     1,167       34     7,372    
Le Meridien     22     4,743       20     4,472       2     271       36     9,356       10     3,291       26     6,065       44     12,769       17     5,269       27     7,500       102     26,868    
Aloft     71     10,806       66     9,892       5     914       18     4,072       9     2,101       9     1,971       5     1,059       4     651       1     408       94     15,937    
Element     16     2,489       16     2,489                 1     188       1     188                 1     133       1     133                 18     2,810    
Other     3     648       3     648                                               1     250                 1     250       4     898    
Vacation Ownership     15     7,662       14     7,082       1     580                                                                   15     7,662    
Total Systemwide     699     201,990       603     181,276       96     20,714       297     93,146       148     53,884       149     39,262       253     63,265       166     38,721       87     24,544       1,249     358,401    
                                                                                                                                               
     
STARWOOD HOTELS & RESORTS WORLDWIDE, INC.    
Vacation Ownership Inventory Pipeline    
As of June 30, 2015    
UNAUDITED    
                           
              # Resorts       # of Units (1)    
Brand             Total (2)      

In

Operations

         

In Active

Sales

      Completed (3)       Pre-sales/

Development (4)

     

Future

Capacity (5),(6)

       

Total at

Buildout

   
Sheraton               7         7             6         3,079                 712             3,791    
Westin               10         9             9         1,676         412         43             2,131    
St. Regis               2         2                     56                             56    
The Luxury Collection               1         1                     6                             6    
Unbranded               2         2             1         99                             99    
Total SVO, Inc.               22         21             16         4,916         412         755             6,083    

Unconsolidated Joint Ventures

  (UJV's)

              1         1             1         198                             198    
Total including UJV's               23         22             17         5,114         412         755             6,281    
Total Intervals Including UJV's (7)                                                 265,928         21,424         39,260             326,612    
                                                                                         
(1)     Lockoff units are considered as one unit for this analysis.
(2)     Includes resorts in operation, active sales or future development.
(3)     Completed units include those units that have a certificate of occupancy.
(4)     Units in Pre-sales/Development are in various stages of development (including the permitting stage), most of which are currently being offered for sale to customers.
(5)     Based on owned land and average density in existing marketplaces.
(6)     Future units indicated above include planned timeshare units on land owned by the Company or applicable UJV that have received all major governmental land use approvals for the development of timeshare. There can be no assurance that such units will in fact be developed and, if developed, the time period of such development (which may be more than several years in the future). Some of the projects may require additional third-party approvals or permits for development and build out and may also be subject to legal challenges as well as a commitment of capital by the Company. The actual number of units to be constructed may be significantly lower than the number of future units indicated.
(7)     Assumes 52 intervals per unit.
       
       

 

 



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