What changed in this filing

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Item 1. Business

2025-02-19 compared with 2024-02-21 · 68 added, 97 removed, 366 unchanged (31% of the section changed)

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Travel + Leisure Co.

is the world’s leading membership and leisure travel company.

We provide vacation experiences and travel inspiration to millions of owners, members, and subscribers through our products and services.

is the world’s leading vacation ownership and membership travel company.

We provide vacation experiences and travel inspiration to millions of owners, members, and subscribers through our diverse portfolio of products and services.

Travel + Leisure Co.

has the following segments:

• Vacation Ownership includes our Wyndham Destinations business line, which is the world’s largest vacation ownership company with 804,000 owners and more than 245 vacation club resort locations.

• Vacation Ownership includes the world’s largest vacation ownership business with 809,000 owners and more than 270 vacation club resort locations.

We provide vacation ownership experiences under some of the most popular hospitality and leisure brands, including Club Wyndham, Margaritaville Vacation Club, and Accor Vacation Club.

The business is developing a new experiential product celebrating the Sports Illustrated brand in the U.S.

• Travel and Membership includes our Exchange and Travel Club business lines.

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our RCI travel club, which seeks to capture a greater share of our members non-exchange travel budgets;

and our business-to-business (“B2B”) travel clubs, which offer white-label solutions to associations, organizations, and other closed user groups.

and our business-to-business (“B2B”) travel clubs, which offer private-label solutions to associations, organizations, and other closed user groups.

History and Development

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has been a leader in the travel membership business for over 50 years.

Our strategy is to accelerate the growth of our global businesses by broadening the strength of our cornerstone timeshare and exchange businesses and creating depth of leisure travel products and services through growth of our travel clubs.

Our strategy is to accelerate the growth of our global businesses by broadening the strength of our cornerstone timeshare business through a multi-brand expansion strategy, and our exchange businesses by creating depth of leisure travel products and services through growth of our travel clubs.

BUSINESS DESCRIPTIONS

We report results of operations for the following reportable segments, which are described in more detail below:

• Vacation Ownership, substantially comprised of Wyndham Destinations.

• Vacation Ownership, substantially comprised of the vacation ownership product lines:

Club Wyndham, WorldMark by Wyndham, Margaritaville Vacation Club, and Accor Vacation Club.

• Travel and Membership , comprised of Exchange and Travel Club.

Our business segments generate diversified revenue streams and significant cash flow.

In 2023, we generated 42% of our revenues from the sale of vacation ownership interests, and 44% from our fee-for-service revenue streams.

In 2024, we generated 45% of our revenues from the sale of vacation ownership interests, 42% from our fee-for-service revenue streams, 12% from our consumer financing revenue stream, and 1% from other ancillary revenue streams.

Our businesses have both domestic and international operations.

During 2024, we derived 88% of our revenues in the United States (“U.S.”) and 12% internationally.

For further details on our segment revenues, profits, assets and geographical operations, see Note 23— Segment Information to the Consolidated Financial Statements.

For further details on our segment revenues, expenses, profits, assets, and geographical operations, see Note 23— Segment Information to the Consolidated Financial Statements.

VACATION OWNERSHIP

The vacation ownership industry, also referred to as the timeshare industry, enables consumers to share ownership of fully-furnished vacation accommodations.

The vacation ownership industry, also referred to as the timeshare industry, enables consumers to share ownership of fully-furnished and professionally managed vacation accommodations.

Typically, the consumer purchases either a title to a fraction of a unit through a points-based system or a right to use a property for a specific period of time through a weekly interval system.

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Vacation Ownership Overview

Our Vacation Ownership reportable segment is substantially comprised of our Wyndham Destinations branded business line, which is the world’s largest vacation ownership business based on number of resorts and owners.

Our Vacation Ownership reportable segment is substantially comprised of the vacation ownership product lines:

Club Wyndham, WorldMark by Wyndham, Margaritaville Vacation Club, and Accor Vacation Club;

and is the world’s largest vacation ownership business based on number of resorts and owners.

We develop and acquire vacation ownership resorts, market and sell VOIs, provide consumer financing for the majority of the VOI sales, and provide property management services to property owners’ associations.

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Our programs allow us to market and sell our vacation ownership products in variable quantities and to offer existing owners “upgrade” sales to supplement their existing VOIs.

During 2023, we entered into an agreement to acquire the rights to the vacation ownership business of Sports Hospitality Ventures, LLC (“SHV”), a hotel and resorts licensee for the Sports Illustrated brand.

This business line is included in the Vacation Ownership segment.

In 2023, we introduced a new concept for a network of sports-themed resort and lifestyle complexes in popular college towns and leisure destinations under the Sports Illustrated Resorts brand.

We are still early in the development of the Sports Illustrated Resorts portfolio.

We anticipate developing properties in this portfolio using an asset-light development financing model.

Our goal is to strengthen our leadership position in the vacation ownership industry and generate consistent and long-term value for our shareholders.

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Maximize our relationship with Wyndham Hotels.

We have a long-term, exclusive license agreement and marketing arrangements with Wyndham Hotels, the world’s largest hotel franchiser by number of hotels with approximately 9,200 affiliated hotels located in more than 95 countries.

The Wyndham Hotels loyalty program, Wyndham Rewards, has over 106 million enrolled members, many of whom fit our target new-customer demographic, providing us with a substantial customer sourcing opportunity to drive future VOI sales.

We plan to increase this sales channel with initiatives such as enhanced call transfers, online marketing, in-hotel marketing, and online rentals of vacation ownership resorts.

The Wyndham Hotels loyalty program, Wyndham Rewards, has approximately 114 million enrolled members, many of whom fit our target new-customer demographic, providing us with a substantial customer sourcing opportunity to drive future VOI sales.

We plan to leverage this sales channel through initiatives such as enhanced call transfers, online marketing, in-hotel marketing, and online rentals of vacation ownership resorts.

Volume per guest on these affinity marketing tours is generally higher than other tours, helping to increase margins on new owner sales.

Add leisure or hospitality brands to our existing portfolio.

The addition of brands will help us expand in existing markets or extend into new markets.

The addition of brands will help us expand within our existing markets or extend into new markets.

New brands will also help with lead generation for new owner tours.

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Additionally, we operate telesales and virtual sales programs designed to reach and solicit upgrade sales to existing owners we were not able to market to during their vacations.

In total VOI upgrade sales represented 68% and 70% of our net VOI sales in 2023 and 2022.

In total VOI upgrade sales represented 68% of our net VOI sales in both 2024 and 2023.

Our marketing and sales activities are often facilitated through marketing alliances with other travel, hospitality, entertainment, gaming, and retail companies that provide access to such companies’ customers through a variety of co-branded marketing offers.

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These loans are structured with equal monthly installments that fully amortize the principal by the final due date.

While the minimum down payment is typically 10%, our average down payment on financed VOI sales was 19% for both 2023 and 2022.

While the minimum down payment is typically 10%, our average down payment on financed VOI sales was 20% and 19% for 2024 and 2023.

During 2024, we generated $1.53 billion of receivables on $2.15 billion of Gross VOI sales, net of Fee-for-Service sales, resulting in 71% of our VOI sales being financed compared to 74% during 2023.

This level of financing is prior to the application of cash received for the full payment of a loan within 60 days of origination.

After the application of these early repayments, we financed 56% of VOI sales during both 2023 and 2022.

After the application of these early repayments, we financed 54% and 56% of VOI sales during 2024 and 2023.

Similar to many other companies that provide consumer financing, we have historically securitized a majority of the receivables originated in connection with the sale of VOIs.

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We assess the performance of our loan portfolio by monitoring numerous metrics including collection rates, defaults by state of residency, and bankruptcies.

Our loan portfolio was 95% and 94% current (not more than 30 days past due) as of December 31, 2023 and 2022.

Our loan portfolio was 95% current (not more than 30 days past due) as of both December 31, 2024 and 2023.

See Note 9— Vacation Ownership Contract Receivables to the Consolidated Financial Statements for further information on the performance of our loan portfolio.

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On behalf of each of the property owners’ associations, we or our affiliates generally provide day-to-day management for vacation ownership resorts, which includes oversight of housekeeping services, maintenance, and refurbishment of the units, and provide certain accounting and administrative services to property owners’ associations.

The terms of the property management agreements are generally between three to five years;

however, the vast majority of the agreements provide a mechanism for automatic renewal upon expiration of the terms.

The initial terms of the property management agreements are generally between three to five years;

however, the vast majority of the agreements provide a mechanism for an automatic one year renewal upon expiration of the terms.

In connection with these property management services, we receive fees which are generally based upon total costs to operate such resorts.

Fees for property management services typically approximate 10% of budgeted operating expenses.

Fees for property management

services typically approximate 10% of budgeted operating expenses.

As the owner of unsold VOIs, we pay maintenance fees in accordance with the legal requirements of the jurisdictions in which the resorts are located.

In addition, at certain newly-developed resorts, we may enter into subsidy agreements with the property owners’ associations to cover costs that otherwise would be covered by annual maintenance fees payable with respect to VOIs that have not yet been sold.

We utilize rental channels to monetize the unsold VOIs to assist in offsetting a portion of such fees.

Any income earned from these monetization activities is recorded as a reduction of the associated expense.

We rely, in part, upon tour flow to generate sales of VOIs;

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Expand and enhance our products and services to increase wallet share, transaction propensity, and retention within our member base.

Through the addition of more inventory options for exchange and more travel products and services, RCI Travel Club seeks to enhance its core exchange business lines’ growth through greater share of consumers’ travel spend, increased member engagement, and reduced churn.

Through the addition of more inventory options for exchange and more travel products and services, RCI seeks to enhance its core exchange business lines’ growth through greater share of consumers’ travel spend, increased member engagement, and reduced churn.

Expand B2B travel solutions.

We seek to expand B2B partnerships across multiple sectors driving incremental transaction revenue.

We offer white-label solutions to associations, organizations, and other closed-user groups in order for these groups to offer travel benefits to their communities which increases engagement and loyalty.

We offer private-label solutions to associations, organizations, and other closed-user groups in order for these groups to offer travel benefits to their communities which increases engagement and loyalty.

Revenues and Operating Statistics

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Our global exchange business competes with other vacation exchange companies, most notably Interval International, certain timeshare developers, and clubs that offer vacation exchange through their own internal networks of properties.

This business also competes with third-party internet travel intermediaries and peer-to-peer online networks that are used by consumers to search for and book their resort and other travel accommodations.

This business

also competes with third-party internet travel intermediaries and peer-to-peer online networks that are used by consumers to search for and book their resort and other travel accommodations.

Our Travel Club business competes more broadly with the larger sector of leisure travel options including traditional travel agents, online travel agents, and travel clubs.

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and its subsidiaries actively use or license for use all significant marks and domain names, and we own or have exclusive licenses to use these marks and domain names.

In connection with the Spin-off, we entered into a license, development and noncompetition

agreement with Wyndham Hotels, which, among other things, granted to Travel + Leisure Co.

In connection with the Spin-off, we entered into a license, development and noncompetition agreement with Wyndham Hotels, which, among other things, granted to Travel + Leisure Co.

the right to use the “Wyndham” trademark, “The Registry Collection” trademark, and certain other trademarks and intellectual property in our business.

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We mitigate this risk by using permission-based marketing in some instances and have implemented procedures to comply with federal and state “do not call” regulations, including subscription to federal and certain state “do not call” registries and maintenance of an internal “do not call” list.

Similarly, state and federal regulations may place limitations on our ability to engage our consumers in electronic mail marketing campaigns, including requirements applicable to the transmission of email messages with the primary purpose of advertising or promoting a commercial product or service.

Similarly, state and federal regulations may place limitations on our ability to engage our consumers in electronic mail marketing campaigns, including requirements applicable to the transmission

of email messages with the primary purpose of advertising or promoting a commercial product or service.

We have adopted email messaging practices responsive to the requirements of such regulations.

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Employee Profile

We recognize our employees as associates who bring our mission to put the world on vacation to life through their service to the world’s leading membership and leisure travel company.

We recognize our employees as associates who bring our mission to put the world on vacation to life through their service to the world’s leading vacation ownership and membership travel company.

Oversight and Management

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Furthermore, our Audit Committee discusses compliance risks related to human capital matters and periodically reviews and updates our Code of Conduct to promote ethical behavior by all of our associates.

As of December 31, 2023, our global team was comprised of over 19,000 associates, 4,200 of whom work outside the U.S.

As of December 31, 2024, our global team was comprised of 19,000 associates, 4,600 of whom work outside the U.S.

Of our global associates 15,900 support Vacation Ownership, 1,800 support Travel and Membership, and 1,300 comprise our corporate group.

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our proprietary Destination U resource is a comprehensive solution that puts the ownership of each associate’s career development directly into their hands.

By fostering growth potential for all

associates at Travel + Leisure Co., we enable each individual to clearly understand their role in the context of the larger organization and to access courses designed specifically to further their development.

By fostering growth potential for all associates at Travel + Leisure Co., we enable each individual to clearly understand their role in the context of the larger organization and to access courses designed specifically to further their development.

• Programs focused on career progression include formal talent reviews, succession planning, associate development programs for all levels, executive coaching, leader onboarding plans, new leader orientation, and tuition and certification reimbursement.

We understand that a culture of rich inclusion and diversity enhances our performance and fortifies our ability to serve our customers.

We strive to cultivate an inclusive environment which enables people to be their authentic selves, and where each associate feels appreciated, respected, and valued as a contributor at every level within the organization.

Competitive Pay/Benefits

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We believe in performance-based variable compensation programs that support a high-performance environment.

All of our managers participate in an annual incentive plan that most closely aligns with their role.

All of our managers and above participate in an annual incentive plan that most closely aligns with their role.

Sales and marketing associates at all levels across our business lines participate in variable compensation plans aligned to their role.

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Travel + Leisure Co.

remains responsive to health-related issues, including COVID-19, for the safety and well-being of our associates, guests, and customers.

remains responsive to health-related issues for the safety and well-being of our associates, guests, and customers.

Our plans mirror the relevant direction from the Center for Disease Control (“CDC”) and prevention guidelines for the U.S.

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Information on our website is not part of, or incorporated by reference into, this Annual Report on Form 10-K.

ENVIRONMENTAL, SOCIAL, AND GOVERNANCE

We are committed to making a positive impact on our world while delivering stakeholder value through our Environmental, Social, and Governance (“ESG”) strategy, Full Circle.

CORPORATE RESPONSIBILITY

We are committed to making a positive impact on our world while delivering stakeholder value through our Corporate Responsibility strategy, Full Circle.

This strategy remains an integral part of our company culture and is reflected in our global business operations.

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Our Full Circle strategy is recognized through the prestigious honors we have earned, including:

• Fair360’s (formerly DiversityInc) Top 50 Companies for Inclusive Workplaces,

• Fortune magazine’s World’s Most Admired Companies,

• Forbes’ America’s Best Large Employers,

News’ Best Companies to Work For,

• Newsweek’s lists of both World’s Most Trustworthy Companies and Most Trustworthy Companies in America,

• National Veteran-Owned Business Association’s Best Corporations for Veteran’s Business Enterprises,

• National LGBT Chamber of Commerce’s “Best-of-the-Best” Corporations,

• National Business Inclusion Consortium’s (“NBIC”) Top 50 Best-of-the-Best Corporations for Inclusion, and the

• Human Rights Campaign’s 2023-2024 Equality 100 award for leaders in LGBTQ+ workplace inclusion.

• Newsweek’s Most Trustworthy Companies in America,

• Newsweek’s list of America’s Most Responsible Companies,

• National Veteran-Owned Business Association’s Best Corporations for Veteran’s Business Enterprises, and the

• National Business Inclusion Consortium’s (“NBIC”) Top 50 Best-of-the-Best Corporations for Inclusion.

Environmental Progress

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reducing our environmental footprint, expanding our renewables portfolio, and prioritizing biodiversity in locations where we live and work.

Our commitment to environmental

management extends beyond fully owned assets, encompassing all assets we own, manage, and lease.

Our commitment to environmental management extends beyond fully owned assets, encompassing all assets we own, manage, and lease.

We closely partner with applicable property owners’ associations that we do not control to drive progress toward our environmental goals.

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• Increase renewable electricity consumption (of our managed resorts) to 20% by 2030 compared to our 2010 baseline.

• Reduce water withdrawal per square foot by 35% at our owned, managed, and leased assets by 2025 compared to our 2010 baseline.

• Reduce water withdrawal per square foot by 35% at our owned, managed, and leased assets by the end of 2025 compared to our 2010 baseline.

• Plant two million trees through our partnership with the Arbor Day Foundation by 2025.

As of December 31, 2022, we have reduced our Scope 1 + Scope 2 GHG emissions intensity by 36% and continue to increase our renewable energy consumption.

As of December 31, 2023, we have reduced our Scope 1 + Scope 2 GHG emissions intensity by 39% and have increased our renewable energy consumption to 3%.

This progress has been accomplished through a combination of increased operational efficiency, onsite solar projects, and one offsite solar project.

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Environmental Compliance

Our compliance with federal, state and local laws and regulations relating to environmental protection and discharge of hazardous materials has not had a material impact on our capital expenditures, earnings or competitive position, and we do not anticipate any material impact from such compliance in the future.

Our compliance with federal, state and local laws and regulations relating to environmental protection has not had a material impact on our capital expenditures, earnings or competitive position, and we do not anticipate any material impact from such compliance in the future.

Climate Change

Climate change is associated with extreme weather conditions and other natural disasters, such as increased frequency and severity of storms and floods, coastal erosion and flooding due to higher sea levels, increased temperatures, and increased forest fires.

Climate change is believed to be associated with extreme weather conditions and other natural disasters, such as increased frequency and severity of storms and floods, coastal erosion and flooding due to higher sea levels, increased temperatures, and increased forest fires.

We manage properties exposed to areas which are susceptible to adverse effects resulting from these conditions and disasters.

As of December 31, 2023, based on insurable property values, approximately:

• 37% of our managed properties are located in Tier I windstorm exposure areas,

As of December 31, 2024, based on insurable property values:

• 36% of our managed, leased, or owned properties are located in Tier I windstorm exposure areas,

• 22% are in states prone to high-risk wildfire, and

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We are continuously monitoring climate change risks and taking actions to mitigate impacts, as deemed appropriate.

Inclusion & Diversity

We understand that a culture of rich inclusion and diversity enhances our performance and fortifies our ability to serve our customers.

• Our inclusive talent acquisition strategy focuses on developing a diverse pipeline of candidates that includes applicants from a variety of backgrounds, cultures, and experiences.

This includes women, diverse ethnicities, veterans, LGBTQIA+, those with disabilities, generational diversity, and more.

• Our Global Inclusion and Diversity Council (“GIDC”) is comprised of a CEO-led team of diverse senior and executive leaders representing our worldwide operations.

The mission of the GIDC is to foster, cultivate, and design actions to strengthen our culture and global communities, through inclusion, equitable opportunities, and social justice.

• We host voluntary, associate-led Diversity Resource Groups (“DRGs”) for our Asian/Pacific Islander, Black/African American, Hispanic/Latinx, LGBTQIA+, Veteran, and Women associates.

DRGs foster affiliation with colleagues across the business, and are designed to enable the personal growth, professional development, and retention of diverse talent.

Participants have the opportunity to develop their careers through learning, leadership exposure, and business engagement.

Our partnerships with inclusive, diverse organizations at national and regional levels provide a platform for our associates to develop leadership skills and gain inclusion and diversity education.

Additionally, these forums enable executives to showcase thought leadership at sponsored programs and events.

• Our roadmap to drive progress in inclusion and diversity is guided by our goals of continuing to enhance a diverse talent pipeline to increase diverse representation at the director and above level;

ongoing focus on diverse hires at all levels;

and maintaining and growing our business relationships with companies that have diverse ownership.

As of December 31, 2023, 53% of our global associates were women, 45% were men, and 2% were not declared.

On December 31, 2023, of our global leaders with direct reports 52% were men and 48% were women.

The following table provides the global gender distribution by level:

Gender Below Director Director and above (a)

Female 53% 41%

Undeclared 2% —%

(a) Includes our executive officers which are 80% male and 20% female.

Our ethnic representation in the U.S.

as of December 31, 2023 was:

• 23% Hispanic/Latinx

• 14% Black/African American

• 4% Two or more races

• 2% Native Hawaiian/Other Pacific Islander

• 1% Native American/American Indian

• 2% Undeclared

The following table provides the U.S.

ethnic diversity distribution by level:

Below Director Director and above (a)

White 46% 75%

Diverse 52% 24%

Undeclared 2% 1%

(a) Includes our executive officers which are 90% white and 10% ethnically diverse.

Beyond our diverse workforce, we have diverse representation on our Board, with four of our nine Board members being gender and/or ethnically diverse.

We remain committed to sustaining our reputation as an engaged and responsive organization.

Travel + Leisure Co.

President and CEO Michael Brown signed the CEO Diversity Action Pledge in partnership with CEO Action for Diversity & Inclusion, joining more than 2,400 global organizations who have pledged to act on supporting a more inclusive workplace for employees, communities, and society at large.

Brown was also among 75 Central Florida leaders to sign the first-ever Orlando Economic Partnership Regional Corporate Pledge in 2020, committing to improve regional diversity, equity, and inclusion outcomes.

With a focus on improving the lives of children and families through vacations, we support charitable organizations with a similar focus and mission.

Our philanthropic efforts drive support for organizations including Give Kids the World Village, Jack and Jill Late Stage Cancer Foundation, as well as our internal Associate Relief Fund.

Our philanthropic efforts drive support for organizations including Give Kids the World Village,

Jack and Jill Late Stage Cancer Foundation, as well as our internal Associate Relief Fund.

Our decades long partnership with Christel House International supports educational opportunities for children in underserved global communities.

Additionally, through contributions to Step Up for Students, we support providing low-income families in Florida the opportunity to choose the best education for their children.

Most recently, we established the Travel + Leisure Charitable Foundation.

This foundation embraces a diverse and inclusive community through a variety of programs, including leadership training, mentoring opportunities, and educational support.

We established the Travel + Leisure Charitable Foundation.

This foundation embraces a diverse and inclusive community through mentoring opportunities and educational support.

Since its formation, the Travel + Leisure Charitable Foundation has partnered with the School Board of Orange County, Florida, to create the Travel + Leisure Eatonville scholarship program, which strives to promote educational excellence within the Eatonville community, the oldest African-American-incorporated municipality in the U.S., by providing scholarships to eligible students.

In 2024, the Travel + Leisure Charitable Foundation initiated a partnership with the School District of Osceola County, Florida, to bring the Travel + Leisure Scholarship Program to qualifying Osceola County students beginning in the 2024-2025 school year.

For detailed information about our governance practices, see “Governance” in the Proxy Statement for our 2024 Annual Meeting of Shareholders.

Visit our website at travelandleisureco.com/esg-commitment for additional information on our social responsibility activities and initiatives, along with our 2022 ESG report.

Information on our website, including our 2022 ESG report, is not part of, or incorporated in, this Annual Report on Form 10-K.

Visit our website at travelandleisureco.com/esg-commitment for additional information on our corporate responsibility activities and initiatives, along with our 2023 Environmental, Social, and Governance report.

Information on our website, including our 2023 Environmental, Social, and Governance report, is not part of, or incorporated in, this Annual Report on Form 10-K.

KEY AGREEMENTS RELATED TO THE SPIN-OFF

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Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 1. Business