What changed in this filing

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Item 2. Management’s Discussion and Analysis

2024-11-07 compared with 2024-08-02 · 230 added, 187 removed, 530 unchanged (44% of the section changed)

4 unchanged sentences

timing of payments related to purchase commitments;

our possible or assumed future results of operations, financial condition, leverage, the ratio of our corporate debt, net of cash and equivalents, to Adjusted EBITDA, liquidity, returns on investments, margins including financing profit and development profit margins;

our possible or assumed future results of operations, financial condition, leverage, liquidity, returns on investments, margins including financing profit and development profit margins;

dividend payments;

3 unchanged sentences

our plans to pursue growth opportunities;

potential operating performance, including our expectations regarding contract sales, including contract sales from our Maui sales centers;

our expectation that consumer financing interest expense will remain higher than our average outstanding interest rates on existing securitization transactions;

our expectation that inventory spending will exceed cost of sales for the remainder of 2024 due to our commitment to acquire property in Waikiki and the quantity and impact of inventory repurchases on the future cost of our vacation ownership products;

potential operating performance, including our expectations regarding full year contract sales, including contract sales from our Maui sales centers;

VPG and tour growth;

our expectation that consumer financing interest expense will remain higher than our average outstanding interest rates on existing securitization transactions and the resulting impact on our profit margin;

our expectation that inventory spending will exceed cost of sales for the remainder of 2024 and the quantity and impact of inventory repurchases on the future cost of our vacation ownership products;

indemnification;

1 unchanged sentence

taxes, including the impact of Pillar 2;

our ability to securitize consumer loans and related default rates and reserve requirements;

our ability to securitize consumer loans and our assumptions regarding related delinquency and default rates and reserve requirements;

the pace of originations of vacation ownership notes receivable compared to payoffs of existing notes receivable;

12 unchanged sentences

impacts from natural or man-made disasters and wildfires, including the Maui wildfires;

delinquency and default rates;

global supply chain disruptions;

4 unchanged sentences

the impact of changes in interest rates;

the effects of steps we have taken and may continue to take to reduce operating costs;

the effects of steps we have taken and may continue to take to reduce operating costs and accelerate growth and profitability;

political or social strife;

29 unchanged sentences

Corporate and other represents that portion of our results that are not allocable to our segments, including those relating to consolidated property owners’ associations (“Consolidated Property Owners’ Associations”).

We recently launched a strategic business operations function to lead modernization, process improvement and long-term value generating initiatives across our business.

We believe we can drive $50 million to $100 million of annual efficiencies over the next two years and plan to reinvest some of these savings to accelerate revenue growth and enhance our customer platforms, products, and services.

We routinely post important information, including news releases, announcements and other statements about our business and results of operations, that may be deemed material to investors on the Investor Relations section of our website, www.marriottvacationsworldwide.com.

4 unchanged sentences

We measure operating performance using the key metrics described below:

• Contract sales from the sale of vacation ownership products, which consists of the total amount of vacation ownership product sales under contracts signed during the period where we have generally received a down payment of at least ten percent of the contract price, reduced by actual rescissions during the period, inclusive of contracts associated with sales of vacation ownership products on behalf of third parties, which we refer to as “resales contract sales.” In circumstances where customers apply any or all of their existing ownership interests as part of the purchase price for additional interests, we include only the incremental value purchased as contract sales.

Contract sales differ from revenues from the sale of vacation ownership products that we report on our income statements due to the requirements for revenue recognition and adjustments for sales incentives that will not be recognized as Sale of vacation ownership products revenue and other adjustments to Sale of vacation ownership products revenue.

• Contract sales from the sale of vacation ownership products, which consists of the total amount of vacation ownership product sales under contracts signed during the period where we have generally received a down payment of at least ten percent of the contract price, reduced by actual rescissions during the period, inclusive of contracts associated with sales of vacation ownership products on behalf of third parties, which we refer to as “resales.” In circumstances where customers apply any or all of their existing ownership interests as part of the purchase price for additional interests, we include only the incremental value purchased as contract sales.

Contract sales differ from revenues from the sale of vacation ownership products that we report on our income statements due to the requirements for revenue recognition, the reserve for vacation ownership notes receivable and adjustments for sales incentives that will not be recognized as Sale of vacation ownership products revenue and other adjustments to Sale of vacation ownership products revenue.

We consider contract sales to be an important operating measure because it reflects the pace of sales in our business.

1 unchanged sentence

• Consolidated contract sales exclude contract sales from the sale of vacation ownership products for non-consolidated joint ventures.

• Volume per guest (“VPG”) is calculated by dividing consolidated vacation ownership contract sales, excluding fractional sales, telesales, resales, and other sales that are not attributed to a tour, by the number of tours in a given period.

We believe that this operating metric is valuable in evaluating the effectiveness of the sales process as it combines the impact of average contract price with the number of touring guests who make a purchase.

Tours refers to the number of sales tours performed during the applicable period, and generally include virtual and offsite sales tours, and exclude telesales.

We believe that VPG is valuable in evaluating the effectiveness of the sales process as it combines the impact of average contract price with the number of touring guests who make a purchase.

We believe that tours is a valuable metric because it represents the volume of touring guests.

• Development profit margin is calculated by dividing Development profit by revenues from the sale of vacation ownership products.

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We consider this measure to be important in evaluating the performance of our reportable business segments.

See Footnote 16 “Business Segments” to our Financial Statements for further information on our reportable business segments.

See Footnote 16 “Business Segments” to our Financial Statements for further information about our reportable business segments.

• Adjusted EBITDA margin is calculated by dividing Adjusted EBITDA by total revenues less cost reimbursement revenues.

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Consolidated Results

Three Months Ended Six Months Ended

($ in millions) June 30, 2024 June 30, 2023 June 30, 2024 June 30, 2023

Three Months Ended Nine Months Ended

($ in millions) September 30, 2024 September 30, 2023 September 30, 2024 September 30, 2023

Sale of vacation ownership products $ 387 $ 319 $ 1,048 $ 1,085

17 unchanged sentences

TOTAL EXPENSES 1,157 1,081 3,253 3,099

(Losses) gains and other (expense) income, net (7) 10 (7) 31

Gains and other income, net 9 3 2 34

Interest expense, net (40) (36) (123) (106)

7 unchanged sentences

Operating Statistics

Three Months Ended Six Months Ended

(Contract sales $ in millions) June 30, 2024 June 30, 2023 Change

June 30, 2024 June 30, 2023 Change

Three Months Ended Nine Months Ended

(Contract sales $ in millions) September 30, 2024 September 30, 2023 Change

September 30, 2024 September 30, 2023 Change

Vacation Ownership

3 unchanged sentences

VPG $ 3,888 $ 4,055 $ (167) (4%) $ 3,910 $ 4,118 $ (208) (5%)

110,557 100,609 9,948 10% 318,888 300,245 18,643 6%

Exchange & Third-Party Management

1 unchanged sentence

Average revenue per member $ 38.93 $ 39.15 $ (0.22) (1%) $ 118.98 $ 120.48 $ (1.50) (1%)

Three Months Ended Six Months Ended

($ in millions) June 30, 2024 June 30, 2023 Change

2023 June 30, 2024 June 30, 2023 Change

Three Months Ended Nine Months Ended

($ in millions) September 30, 2024 September 30, 2023 Change

2023 September 30, 2024 September 30, 2023 Change

Vacation Ownership $ 1,250 $ 1,126 $ 124 11% $ 3,458 3,335 $ 123 4%

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These differences can result in considerable variability in the relative costs of productive assets and the depreciation and amortization expense among companies.

We believe Adjusted EBITDA is useful as an indicator of operating performance because it allows for period-over-period comparisons of our on-going core operations before the impact of the excluded items.

We believe Adjusted EBITDA margin is useful as an indicator of operating profitability because it allows for period-over-period comparisons of the profitability of our on-going core operations before the impact of the excluded items.

EBITDA and Adjusted EBITDA margin also facilitate comparisons by us, analysts, investors, and others of results from our on-going core operations before the impact of these items with results from other companies.

We believe Adjusted EBITDA is useful as an indicator of operating performance because it allows for period-over-period comparisons of our ongoing core operations before the impact of the excluded items.

We believe Adjusted EBITDA margin is useful as an indicator of operating profitability because it allows for period-over-period

comparisons of the profitability of our ongoing core operations before the impact of the excluded items.

Adjusted EBITDA and Adjusted EBITDA margin also facilitate comparisons by us, analysts, investors, and others of results from our ongoing core operations before the impact of these items with results from other companies.

EBITDA, Adjusted EBITDA, and Adjusted EBITDA margin have limitations and should not be considered in isolation or as a substitute for performance measures calculated in accordance with GAAP.

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The table below shows our EBITDA and Adjusted EBITDA calculation and reconciles these measures with Net income attributable to common stockholders, which is the most directly comparable GAAP financial measure.

Three Months Ended Six Months Ended

($ in millions) June 30, 2024 June 30, 2023 Change

2023 June 30, 2024 June 30, 2023 Change

Three Months Ended Nine Months Ended

($ in millions) September 30, 2024 September 30, 2023 Change

2023 September 30, 2024 September 30, 2023 Change

Net income attributable to common stockholders

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The table below details the components of Certain items for the periods presented.

Three Months Ended Six Months Ended

($ in millions) June 30, 2024 June 30, 2023 June 30, 2024 June 30, 2023

Three Months Ended Nine Months Ended

($ in millions) September 30, 2024 September 30, 2023 September 30, 2024 September 30, 2023

ILG integration $ — $ — $ — $ 15

10 unchanged sentences

Change in indemnification asset 2 (6) 4 (30)

Change in estimates relating to pre-acquisition contingencies (4) — (4) —

Other — — — (4)

Losses (gains) and other expense (income), net 7 (10) 7 (31)

Gains and other income, net (9) (3) (2) (34)

Other 2 2 1 —

Total Certain items $ (4) $ 9 $ 39 $ 11

Commencing in the second quarter of 2024, we discontinued classifying adjustments related to Welk purchase accounting as Purchase accounting adjustments.

Ongoing costs associated with the continued integration of Welk will be reflected in our operating results commencing in the third quarter of 2024.

During the second quarter of 2024, we discontinued classifying adjustments related to Welk purchase accounting as Purchase accounting adjustments.

Commencing in the third quarter of 2024, ongoing costs associated with the continued integration of Welk are reflected in our operating results.

Segment Adjusted EBITDA

Three Months Ended Six Months Ended

($ in millions) June 30, 2024 June 30, 2023 Change

2023 June 30, 2024 June 30, 2023 Change

Three Months Ended Nine Months Ended

($ in millions) September 30, 2024 September 30, 2023 Change

2023 September 30, 2024 September 30, 2023 Change

Vacation Ownership $ 231 $ 173 $ 58 33% $ 624 $ 647 $ (23) (4%)

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Vacation Ownership

Three Months Ended Six Months Ended

($ in millions) June 30, 2024 June 30, 2023 Change

2023 June 30, 2024 June 30, 2023 Change

Three Months Ended Nine Months Ended

($ in millions) September 30, 2024 September 30, 2023 Change

2023 September 30, 2024 September 30, 2023 Change

Segment financial results $ 205 $ 149 $ 56 37% $ 531 $ 578 $ (47) (8%)

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The table below details the components of Certain items for Vacation Ownership segment financial results.

Three Months Ended Six Months Ended

($ in millions) June 30, 2024 June 30, 2023 June 30, 2024 June 30, 2023

Three Months Ended Nine Months Ended

($ in millions) September 30, 2024 September 30, 2023 September 30, 2024 September 30, 2023

Purchase accounting adjustments $ — $ 3 1 6

Litigation charges 2 2 15 8

Restructuring charges 1 — 1 —

Impairment charges — — — 4

2 unchanged sentences

Change in indemnification asset — (6) — (9)

Change in estimates relating to pre-acquisition contingencies (4) — (4) —

Other — — — (4)

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Exchange & Third-Party Management

Three Months Ended Six Months Ended

($ in millions) June 30, 2024 June 30, 2023 Change

2023 June 30, 2024 June 30, 2023 Change

Three Months Ended Nine Months Ended

($ in millions) September 30, 2024 September 30, 2023 Change

2023 September 30, 2024 September 30, 2023 Change

Segment financial results $ 15 $ 23 $ (8) (33%) $ 55 $ 75 $ (20) (26%)

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43.1% 49.8% (6.7 pts) 46.5% 52.5% (6.0 pts)

Certain items for the Exchange & Third-Party Management segment for the three and six months ended June 30, 2024 consisted of $2 million of impairment charges.

The table below details the components of Certain items for Exchange and Third-Party Management segment financial results.

Three Months Ended Nine Months Ended

($ in millions) September 30, 2024 September 30, 2023 September 30, 2024 September 30, 2023

Restructuring charges $ 1 $ — $ 1 $ —

Impairment charges — — 2 —

Gain on disposition of hotel, land and other (1) (1) (1) (1)

Other — 1 — 1

Total Certain items $ — $ — $ 2 $ —

Business Segments

1 unchanged sentence

Vacation Ownership and Exchange & Third-Party Management.

See Footnote 16 “Business Segments” to our Financial Statements for further information on our segments.

See Footnote 16 “Business Segments” to our Financial Statements for further information about our segments.

Vacation Ownership

Three Months Ended Six Months Ended

($ in millions) June 30, 2024 June 30, 2023 June 30, 2024 June 30, 2023

Three Months Ended Nine Months Ended

($ in millions) September 30, 2024 September 30, 2023 September 30, 2024 September 30, 2023

Sale of vacation ownership products $ 387 $ 319 $ 1,048 $ 1,085

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Litigation charges 2 2 15 8

Restructuring 1 — 1 —

Royalty fee 28 30 85 88

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Sale of Vacation Ownership Products

Second Quarter and First Half

Three Months Ended Six Months Ended

($ in millions) June 30, 2024 % of Consolidated Contract Sales, Net of Resales June 30, 2023 % of Consolidated Contract Sales, Net of Resales Change

June 30, 2024 % of Consolidated Contract Sales, Net of Resales June 30, 2023 % of Consolidated Contract Sales, Net of Resales Change

Third Quarter and First Three Quarters

Three Months Ended Nine Months Ended

($ in millions) September 30, 2024 % of Consolidated Contract Sales, Net of Resales September 30, 2023 % of Consolidated Contract Sales, Net of Resales Change

September 30, 2024 % of Consolidated Contract Sales, Net of Resales September 30, 2023 % of Consolidated Contract Sales, Net of Resales Change

Consolidated contract sales

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Sale of vacation ownership products $ 387 86% $ 319 74% $ 68 22% $ 1,048 80% $ 1,085 84% $ (37) (3%)

$ 3,888 $ 4,055 $(167) (4%) $ 3,910 $ 4,118 $(208) (5%)

110,557 100,609 9,948 10% 318,888 300,245 18,643 6%

Financing propensity

5 unchanged sentences

and Canadian residents.

Second Quarter and First Half

Contract sales in the second quarter and first half of 2024 declined due to a 6% decrease in VPG in each period, partially offset by an increase in tours (5% and 4%, respectively).

The decrease in VPG in both periods was due to a decline in first time buyer VPG, a larger percentage mix of international tours which carry a lower VPG, and the on-going impact from the reduced activity at our Maui sales centers.

Excluding the $16 million and $32 million decline in contract sales at our Maui sales centers in the second quarter and first half of 2024, respectively, contract sales increased 3% in each period.

Third Quarter and First Three Quarters

Contract sales increased during the third quarter and first three quarters of 2024 due to higher tours in each period compared to prior year periods of 10% and 6%, respectively, partially offset by lower VPGs of 4% and 5%, respectively.

The decrease in VPG in both periods was due to a decline in first time buyer VPG and a larger percentage mix of international tours, which carry a lower VPG than domestic tours, partially offset by a slight increase in VPG from existing owners, and the ongoing impact from the lack of comparability of activity at our Maui sales centers given the wildfires.

Excluding the $15 million increase at our Maui sales centers in the third quarter of 2024, contract sales and tours increased 2% and 6%, respectively.

Excluding the $17 million decline at our Maui sales centers in the first three quarters of 2024, contract sales and tours increased 2% and 7%, respectively.

We expect our full year 2024 contract sales will reflect lower VPG for the last quarter of 2024, partially offset by growth in first time buyer tours, which carry a lower VPG.

In the third quarter of 2023, we increased our vacation ownership notes receivable reserve to reflect then-current trends in delinquencies and default rates.

We estimated the amount of the increase in our sales reserve primarily using a historical period of increased defaults.

The additional reserves recorded in 2023 adjusted our future default rate estimate to reflect then-current macroeconomic conditions, including inflation outpacing wage growth, continuing high interest rates, mixed economic indicators and increased global insecurity.

The $59 million additional reserves recorded in 2023 adjusted our future default rate estimate to reflect then-current macroeconomic conditions, including inflation outpacing wage growth, continuing high interest rates, mixed economic indicators and increased global insecurity.

Subsequent to the third quarter of 2023, we increased our sales reserve rate to provide for higher expected cumulative losses on new originations.

We believe the cumulative impact of inflation on consumers and the related impact on year-over-year increases in maintenance fees for 2023 and 2024 are driving continued elevated delinquencies and defaults.

As a result, during the second quarter of 2024, we increased our sales reserve by $70 million to reflect increases in expected cumulative loss rates for our vacation ownership notes receivable originated during 2021-2024.

In estimating the increase in the sales reserve, we considered current macroeconomic conditions, including higher consumer debt levels, moderating inflation, continued high interest rates, uncertainty around timing and frequency of interest rate adjustments and continued mixed economic indicators.

While we expect a return to normalized maintenance fee increases commencing in 2025, we plan to increase our sales reserve prospectively for new originations at a weighted average rate of 17% to 19% until we have sufficient evidence of improvement in delinquency and default rates.

We expect our full year 2024 contracts sales will reflect lower VPG for the second half of 2024, partially offset by tour growth in first time buyer tours, which carry a lower VPG.

We believe the cumulative impact of inflation on consumers and the related impact of higher than historical year-over-year increases in maintenance fees for 2023 and 2024 have continued to drive elevated delinquencies and defaults.

As a result of the elevated delinquencies and defaults, during the second quarter of 2024, we increased our sales reserve by $70 million to reflect increases in expected cumulative loss rates for our vacation ownership notes receivable originated during 2021-2024.

In estimating the increase in the sales reserve, we considered then-current macroeconomic conditions, including higher consumer debt levels, moderating inflation, continued high interest rates, uncertainty around timing and frequency of interest rate adjustments and continued mixed economic indicators.

As expected, maintenance fee increases for our points based products for 2025, which were approved by the relevant property owners’ association, returned to normal, however, consistent with the 2024 third quarter, we plan to continue to assume an increased sales reserve for new originations until we have sufficient evidence of improvement in delinquency and default rates.

Development Profit

Second Quarter

Third Quarter

Three Months Ended

($ in millions) June 30, 2024 % of Revenue June 30, 2023 % of Revenue Change

($ in millions) September 30, 2024 % of Revenue September 30, 2023 % of Revenue Change

Sale of vacation ownership products $ 387 $ 319 $ 68 22%

3 unchanged sentences

Development profit margin 27.2% 20.7% 6.5 pts

The decrease in Development profit reflects lower sales of vacation ownership products and higher marketing and sales costs, including $8 million of higher preview costs, partially offset by $13 million of lower product cost associated with the additional sales reserve, $11 million of favorable product cost true-up activity compared to the prior comparable period and $4 million from the sale of lower average cost inventory.

Development profit margin, excluding the impact of the sales reserve increase of $70 million, was 27.0% in the second quarter of 2024.

We expect our full year 2024 Development profit margin to decline due to increased marketing and sales expense, the $57 million net impact from the additional sales reserve recorded in the second quarter, and our higher sales reserve rate to be applied to new originations.

Six Months Ended

($ in millions) June 30, 2024 % of Revenue June 30, 2023 % of Revenue Change

The increase in Development profit reflects higher sales of vacation ownership products ($59 million from the higher sales reserve recorded in the prior year), partially offset by higher marketing and sales costs, including $8 million of higher preview costs associated with higher tour volumes and higher cost of vacation ownership products ($10 million associated with the prior year sales reserve).

We expect our full year 2024 Development profit margin to decline due to increased marketing and sales expense, the $57 million net impact of the additional sales reserve recorded in the second quarter, and our higher sales reserve rate applied to new originations as discussed above.

First Three Quarters

Nine Months Ended

($ in millions) September 30, 2024 % of Revenue September 30, 2023 % of Revenue Change

Sale of vacation ownership products $ 1,048 $ 1,085 $ (37) (3%)

3 unchanged sentences

Development profit margin 21.6% 27.0% (5.4 pts)

The decrease in Development profit reflects lower sales of vacation ownership products and higher marketing and sales costs, including $14 million of higher preview costs, partially offset by $13 million of lower product cost associated with the additional sales reserve, $11 million due to the sale of lower cost inventory, $5 million of favorable product cost true-up activity compared to the prior comparable period, $2 million associated with lower sales volume and $2 million of other development related costs.

Development profit margin, excluding the impact of the $70 million sales reserve increase in the second quarter of 2024, was 24.3% in the first half of 2024.

The decrease in Development profit reflects lower sales of vacation ownership products and higher marketing and sales costs, including $22 million of higher preview costs associated with higher tour volumes, partially offset by $24 million from the sale of lower average cost inventory and $7 million of more favorable product cost true-up activity.

Resort Management and Other Services Revenues, Expenses and Profit

Three Months Ended Six Months Ended

($ in millions) June 30, 2024 June 30, 2023 Change

2023 June 30, 2024 June 30, 2023 Change

Three Months Ended Nine Months Ended

($ in millions) September 30, 2024 September 30, 2023 Change

2023 September 30, 2024 September 30, 2023 Change

Management fee revenues $ 52 $ 44 $ 8 15% $ 155 $ 134 $ 21 15%

8 unchanged sentences

(1) Resort occupancy represents all transient, preview, and owner keys divided by total keys available, net of keys out of service.

Second Quarter and First Half

The increase in Other management and exchange revenues is attributed to higher club dues in both the second quarter and first half of 2024.

The increase in Resort management and other services expenses reflects an increase in ancillary expenses of $3 million and $7 million, and an increase in customer service and exchange company expenses of $1 million and $4 million due to higher wages, benefits, and other operating cost increases in the second quarter and first half of 2024, respectively.

Rental Revenues, Expenses and Profit

Three Months Ended Six Months Ended

($ in millions) June 30, 2024 June 30, 2023 Change

2023 June 30, 2024 June 30, 2023 Change

Three Months Ended Nine Months Ended

($ in millions) September 30, 2024 September 30, 2023 Change

2023 September 30, 2024 September 30, 2023 Change

Rental revenues $ 140 $ 128 $ 12 9% $ 430 $ 404 $ 26 6%

Rental expenses (120) (122) 2 2% (343) (354) 11 3%

Rental profit $ 30 $ 19 $ 11 64% $ 67 $ 44 $ 23 54%

Rental profit $ 20 $ 6 $ 14 NM $ 87 $ 50 $ 37 NM

Rental profit margin 14.7% 5.1% 9.6 pts 20.3% 12.3% 8.0 pts

6 unchanged sentences

(2) Rental occupancy represents transient and preview keys divided by keys available to rent, which is total available keys excluding owner usage.

Second Quarter

Rental profit, excluding profit from owned hotels, increased due to higher plus points revenue of $11 million, an $8 million increase in costs allocated to marketing and sales expense for occupancy used for previews, and $2 million of lower hotel loyalty and other costs.

These changes were partially offset by $5 million of decreased profit due to lower average transient rate on higher keys rented and higher tidy and variable costs, $3 million of increased costs associated with higher owner utilization of third-party vacation and other offerings, and $2 million of higher unsold maintenance fees associated with developer owned inventory.

Rental profit for our owned hotels remained in-line with the second quarter of 2023.

Rental profit, excluding profit from owned hotels, increased due to higher plus points revenue of $22 million, a $14 million increase in costs allocated to marketing and sales expense for occupancy used for previews, and $2 million of lower hotel loyalty and other costs.

These changes were partially offset by $9 million of decreased profit due to lower

average transient rate on higher keys rented and higher tidy and variable costs and $6 million of increased costs associated with higher owner utilization of third-party vacation and other offerings.

Rental profit for our owned hotels remained in-line with the first half of 2023.

Third Quarter

Rental profit, excluding profit from owned hotels, increased due to:

• $8 million of higher plus points revenue;

• an $8 million increase in costs allocated to marketing and sales expense for occupancy used for previews.

These changes were partially offset by:

• $3 million of increased costs associated with higher owner utilization of third-party vacation and other offerings;

• $2 million of higher unsold maintenance fees associated with developer-owned inventory.

Rental profit for our owned hotels remained in-line with the third quarter of 2023.

First Three Quarters

Rental profit, excluding profit from owned hotels, increased due to:

• $31 million of higher plus points revenue;

• a $22 million increase in costs allocated to marketing and sales expense for occupancy used for previews.

These changes were partially offset by:

• $9 million of increased costs associated with higher owner utilization of third-party vacation and other offerings;

• $7 million of decreased profit due to a lower average transient rate on higher keys rented and higher tidy and variable costs.

Rental profit for our owned hotels remained in-line with the first three quarters of 2023.

Financing Revenues, Expenses and Profit

Three Months Ended Six Months Ended

($ in millions) June 30, 2024 June 30, 2023 Change

2023 June 30, 2024 June 30, 2023 Change

Three Months Ended Nine Months Ended

($ in millions) September 30, 2024 September 30, 2023 Change

2023 September 30, 2024 September 30, 2023 Change

Financing revenues $ 87 $ 81 $ 6 6% 255 239 16 7%

4 unchanged sentences

Financing propensity 59.5% 64.0% (4.5 pts) 56.0% 58.2% (2.2 pts)

Second Quarter and First Half

Financing revenues reflect higher interest income as a result of a higher average notes receivable balances and a slightly higher average interest rate for the three and six months ended June 30, 2024.

Third Quarter and First Three Quarters

Financing revenues reflect higher interest income as a result of a higher average notes receivable balances and a slightly higher average interest rate for the three and nine months ended September 30, 2024.

The higher average notes receivable balances resulted from new loan originations in excess of the repayment of existing vacation ownership notes receivable, which we expect to continue for the remainder of 2024.

The increase in consumer financing interest expense is attributable to the higher average securitized debt at a higher average interest rate for our more recent term securitization transactions.

We expect consumer financing interest expense to continue to remain higher than our average outstanding interest rates on existing securitization transactions as a result of higher interest rates until meaningful market interest rate declines occur.

We expect our average interest rate to continue to increase as the current interest rate environment for new securitization transactions is above the average interest rate on our existing securitized debt.

We do not adjust interest rates on consumer financing offerings at the same pace as, or in lock-step with, broader market interest rates;

as a result, we expect our financing profit margin to continue to decrease in 2024, as we repay existing securitization transactions with lower interest rates and enter into new securitization transactions with higher interest rates.

Gains and Other Income

Three Months Ended Six Months Ended

($ in millions) June 30, 2024 June 30, 2023 Change

2023 June 30, 2024 June 30, 2023 Change

Gains and other income, net $ 1 $ 7 $ (6) (82%) $ 1 $ 16 $ (15) (92%)

Second Quarter

During the second quarter of 2023, we recorded $7 million of gains on the disposition of excess real estate.

During the first half of 2023, we recorded $7 million of gains on the disposition of excess real estate, a $4 million gain associated with the earn out of additional proceeds from the 2019 disposition of a land parcel in Cancun, Mexico, a $3 million reduction in certain pre-acquisition contingencies associated with the ILG Acquisition, and $2 million related to the receipt of business interruption insurance proceeds.

as a result, we expect our financing profit margin to continue to decrease in 2024, as we repay existing securitization transactions with lower interest rates.

Litigation Charges

Three Months Ended Six Months Ended

($ in millions) June 30, 2024 June 30, 2023 Change

2023 June 30, 2024 June 30, 2023 Change

Three Months Ended Nine Months Ended

($ in millions) September 30, 2024 September 30, 2023 Change

2023 September 30, 2024 September 30, 2023 Change

Litigation charges $ 2 $ 2 $ — NM $ 15 $ 8 $ 7 NM

Second Quarter and First Half

Litigation charges during the second quarter of 2024 and 2023, as well as the first half of 2024 and 2023, relate primarily to a land disposition in the U.S.

Third Quarter and First Three Quarters

Litigation charges during the third quarter of 2024 and 2023, as well as the first three quarters of 2024 and 2023, relate primarily to a land disposition in the U.S.

and certain resorts in Europe.

Gains and Other Income

Three Months Ended Nine Months Ended

($ in millions) September 30, 2024 September 30, 2023 Change

2023 September 30, 2024 September 30, 2023 Change

Gains and other income, net $ 4 $ 7 $ (3) NM $ 5 $ 23 $ (18) NM

Third Quarter

During the third quarter of 2024, we recorded a $4 million reduction in certain pre-acquisition contingencies associated with the ILG Acquisition.

During the third quarter of 2023, we recorded a $6 million reduction in certain pre-acquisition contingencies associated with the ILG Acquisition.

First Three Quarters

During the first three quarters of 2024, we recorded a $4 million reduction in certain pre-acquisition contingencies associated with the ILG Acquisition.

During the first three quarters of 2023, we recorded a $9 million reduction in certain pre-acquisition contingencies associated with the ILG Acquisition, $7 million of gains on the disposition of excess real estate, a $4 million gain associated with the earn out of additional proceeds from the 2019 disposition of a land parcel in Cancun, Mexico, and $3 million related to the receipt of insurance proceeds.

Exchange & Third-Party Management

Three Months Ended Six Months Ended

($ in millions) June 30, 2024 June 30, 2023 June 30, 2024 June 30, 2023

Three Months Ended Nine Months Ended

($ in millions) September 30, 2024 September 30, 2023 September 30, 2024 September 30, 2023

Management and exchange $ 44 $ 50 $ 141 $ 157

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Depreciation and amortization 7 7 21 23

Restructuring 1 — 1 —

Impairment — — 2 —

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TOTAL EXPENSES 42 42 125 126

Gains and other income, net 1 1 1 1

SEGMENT FINANCIAL RESULTS ATTRIBUTABLE TO COMMON STOCKHOLDERS $ 15 $ 23 $ 55 $ 75

Management and Exchange Profit

Three Months Ended Six Months Ended

($ in millions) June 30, 2024 June 30, 2023 Change

2023 June 30, 2024 June 30, 2023 Change

Three Months Ended Nine Months Ended

($ in millions) September 30, 2024 September 30, 2023 Change

2023 September 30, 2024 September 30, 2023 Change

Management and exchange revenue $ 44 $ 50 $ (6) (14%) $ 141 $ 157 $ (16) (10%)

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Management and exchange profit margin 28.0% 38.9% (10.9 pts) 33.4% 42.3% (8.9 pts)

Second Quarter

Interval International management and exchange revenues declined $3 million or 4% primarily attributed to 7% lower exchange transaction volume, partially offset by a 4% increase in average exchange fees.The decrease in management and exchange revenue reflects a $3 million decline in Aqua-Aston management revenues resulting from fewer available nights for rent, lower occupancy and a lower average daily rate in the Hawaii market due to changes in demand.

Third Quarter

Interval International management and exchange revenues declined $3 million or 8% primarily attributed to 7% lower exchange transaction volume, partially offset by a 4% increase in average exchange fees.

The decrease in management and exchange revenue reflects a $3 million decline in Aqua-Aston management revenues resulting from fewer available nights for rent, lower occupancy, and a lower average daily rate in the Hawaii market due to changes in demand.

The decrease in management and exchange profit was primarily attributed to lower revenues and higher information technology expenses.

Interval International management and exchange revenues declined $4 million or 4% primarily attributed to 6% lower exchange transaction volume, partially offset by a 3% increase in average exchange fees.The decrease in management and exchange revenue reflects a $6 million decline in Aqua-Aston management revenues resulting from fewer available nights for rent, lower occupancy and a lower average daily rate in the Hawaii market due to changes in demand.

First Three Quarters

Interval International management and exchange revenues declined $7 million or 6% primarily attributed to 7% lower exchange transaction volume, partially offset by a 4% increase in average exchange fees.

The decrease in management and exchange revenue reflects a $9 million decline in Aqua-Aston management revenues resulting from fewer available nights for rent, lower occupancy, and a lower average daily rate in the Hawaii market due to changes in demand.

The decrease in management and exchange profit was primarily attributed to lower revenues and higher information technology expenses.

Rental Revenues

Three Months Ended Six Months Ended

($ in millions) June 30, 2024 June 30, 2023 Change

2023 June 30, 2024 June 30, 2023 Change

Three Months Ended Nine Months Ended

($ in millions) September 30, 2024 September 30, 2023 Change

2023 September 30, 2024 September 30, 2023 Change

Rental revenues

$ 11 $ 10 $ 1 7% $ 32 $ 31 $ 1 3%

Second Quarter

Results reflect a 16% decrease in transaction volume, partially offset by a 10% increase in average fees per transaction.

Results reflect a 7% decrease in transaction volume offset by a 7% increase in average fees per transaction.

Third Quarter and First Three Quarters

Results reflect a 3% and 6% increase in average fees per transaction, partially offset by an 8% and 7% decrease in transaction volume, for the third quarter and first three quarters of 2024, respectively.

Corporate and Other

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In addition, Corporate and Other includes the revenues and expenses from Consolidated Property Owners’ Associations.

Three Months Ended Six Months Ended

($ in millions) June 30, 2024 June 30, 2023 June 30, 2024 June 30, 2023

Three Months Ended Nine Months Ended

($ in millions) September 30, 2024 September 30, 2023 September 30, 2024 September 30, 2023

Resort management and other services $ 11 $ 12 $ 35 $ 29

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TOTAL EXPENSES 64 56 197 193

(Losses) gains and other (expense) income, net (8) 3 (8) 15

Gains (losses) and other income (expense), net 4 (5) (4) 10

Interest expense, net (40) (36) (123) (106)

3 unchanged sentences

Provision for income taxes (34) (24) (79) (115)

Net income attributable to noncontrolling interests (1) — — —

FINANCIAL RESULTS ATTRIBUTABLE TO COMMON STOCKHOLDERS $ (136) $ (130) $ (418) $ (434)

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The following table illustrates the impact of certain Consolidated Property Owners’ Associations under the relevant accounting guidance and the changes attributed to the deconsolidation of individual Consolidated Property Owners’ Associations.

Three Months Ended Six Months Ended

($ in millions) June 30, 2024 June 30, 2023 June 30, 2024 June 30, 2023

Three Months Ended Nine Months Ended

($ in millions) September 30, 2024 September 30, 2023 September 30, 2024 September 30, 2023

Resort management and other services $ 11 $ 12 $ 35 $ 29

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Provision for income taxes — (1) (1) (1)

Net income attributable to noncontrolling interests (1) — — —

FINANCIAL RESULTS ATTRIBUTABLE TO COMMON STOCKHOLDERS

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General and Administrative

Three Months Ended Six Months Ended

($ in millions) June 30, 2024 June 30, 2023 Change

2023 June 30, 2024 June 30, 2023 Change

Three Months Ended Nine Months Ended

($ in millions) September 30, 2024 September 30, 2023 Change

2023 September 30, 2024 September 30, 2023 Change

General and administrative $ 62 $ 57 $ 5 8% $ 179 $ 189 $ (10) (6%)

Second Quarter

The decrease in General and administrative expenses for the second quarter of 2024 is due to lower information technology costs, insurance expense and compensation expense of $5 million, $2 million and $3 million, respectively.

The decrease in General and administrative expenses for the first half of 2024 is due to lower information technology costs, insurance expense and compliance related expenses of $9 million, $3 million and $3 million, respectively.

(Losses) Gains and Other (Expense) Income

Three Months Ended Six Months Ended

($ in millions) June 30, 2024 June 30, 2023 Change

2023 June 30, 2024 June 30, 2023 Change

(Losses) gains and other (expense) income, net $ (8) $ 3 $ (11) NM $ (8) $ 15 $ (23) NM

Second Quarter

In the second quarter of 2024, we recorded $4 million of foreign currency translation losses and $4 million of tax related adjustments to the receivable from Marriott International for indemnified tax matters.

In the second quarter of 2023, we recorded $2 million of foreign currency translation gains and a $1 million increase in our receivable from Marriott International for indemnified income tax matters (the true-up to the offsetting accrual is included in the Provision for income taxes line).

In the first half of 2024, we recorded $6 million of foreign currency translation losses and $2 million net of tax related adjustments to the receivable from Marriott International for indemnified tax matters.

In the first half of 2023, we recorded a $21 million increase in our receivable from Marriott International for indemnified income tax matters (the true-up to the offsetting accrual is included in the Provision for income taxes line) and $4 million of foreign currency translation gains, partially offset by $10 million attributed to the redemption premium and write-off of unamortized debt issuance costs resulting from the early redemption of our senior secured notes.

Third Quarter

General and administrative expenses for the third quarter of 2024 increased primarily due to $14 million of higher variable compensation expense and $3 million of higher insurance, partially offset by $11 million of lower information technology costs.

First Three Quarters

The decrease in General and administrative expenses for the first three quarters of 2024 is primarily due to $18 million lower information technology costs and $5 million of lower consulting and compliance related expenses, partially offset by $15 million of higher variable compensation expense.

Gain (Losses) and Other Income (Expense)

Three Months Ended Nine Months Ended

($ in millions) September 30, 2024 September 30, 2023 Change

2023 September 30, 2024 September 30, 2023 Change

Gains (losses) and other income (expense), net $ 4 $ (5) $ 9 NM $ (4) $ 10 $ (14) NM

Third Quarter

In the third quarter of 2024, we recorded $6 million of foreign currency translation gains.

In the third quarter of 2023, we recorded $5 million of foreign currency translation losses.

First Three Quarters

In the first three quarters of 2024, we recorded $4 million of tax related adjustments to the receivable from Marriott International for indemnified tax matters.

In the first three quarters of 2023, we recorded a $21 million increase in our receivable from Marriott International for indemnified income tax matters (the true-up to the offsetting accrual is included in the Provision for income taxes line), partially offset by $10 million attributed to the redemption premium and write-off of unamortized debt issuance costs resulting from the early redemption of our senior secured notes.

Interest Expense

Three Months Ended Six Months Ended

($ in millions) June 30, 2024 June 30, 2023 Change

2023 June 30, 2024 June 30, 2023 Change

Three Months Ended Nine Months Ended

($ in millions) September 30, 2024 September 30, 2023 Change

2023 September 30, 2024 September 30, 2023 Change

Interest expense, net $ (40) $ (36) $ (4) (13%) $ (123) $ (106) $ (17) (17%)

Second Quarter and First Half

Third Quarter and First Three Quarters

The increase in Interest expense, net is attributed to higher variable interest expense and changes in outstanding borrowings during the comparative periods.

2024 Second Quarter

Three Months Ended Six Months Ended

($ in millions) June 30, 2024 June 30, 2023 Change

2023 June 30, 2024 June 30, 2023 Change

2024 Third Quarter

Three Months Ended Nine Months Ended

($ in millions) September 30, 2024 September 30, 2023 Change

2023 September 30, 2024 September 30, 2023 Change

Provision for income taxes $ (34) $ (24) $ (10) (43%) $ (79) $ (115) $ 36 31%

Second Quarter

Our effective tax rate was 22.0% and 35.4% for the three months ended June 30, 2024 and June 30, 2023, respectively.

The effective tax rate for the three months ended June 30, 2024 differed from the blended statutory tax rate for the same period due to income tax adjustments for discrete items, including a $13 million decrease for the expiration of statutes of limitation on certain unrecognized tax benefits, partially offset by a $4 million increase related to prior year true-up adjustments in non-U.S.

jurisdictions.

The effective tax rate for the three months ended June 30, 2023 differed from the blended statutory tax rate for the same period due to income tax adjustments for discrete items, including a $5 million adjustment in stock compensation.

Our effective tax rate was 35.2% and 33.9% for the six months ended June 30, 2024 and June 30, 2023, respectively.

The effective tax rate for the six months ended June 30, 2024 differed from the blended statutory tax rate for the same period due to income tax adjustments for discrete items, including a $20 million increase to remove the permanent reinvestment assertion for certain non-U.S.

entities and a $5 million increase related to prior year true-up adjustments in non-U.S.

jurisdictions, partially offset by a $22 million decrease for the expiration of statutes of limitation on certain unrecognized tax benefits.

The effective tax rate for the six months ended June 30, 2023 differed from the blended statutory tax rate for the same period due to income tax adjustments for discrete items, including an $18 million increase to pre-acquisition reserves for unrecognized tax benefits.

Third Quarter

Our effective tax rate was 28.7% and 36.1% for the three months ended September 30, 2024 and September 30, 2023, respectively.

The effective tax rate for the three months ended September 30, 2024 differed from the blended statutory tax rate for the same period due to income tax adjustments for discrete items, including an $11 million decrease related to changes in valuation allowances on certain deferred tax assets in non-U.S.

jurisdictions and a $6 million decrease primarily attributable to the expiration of statutes of limitation on certain unrecognized tax benefits, partially offset by an $8 million increase to remove the permanent reinvestment assertion for our earnings in certain non-U.S.

entities and an increase of $3 million for deferred non-U.S.

withholding taxes.

The effective tax rate for the three months ended September 30, 2023 differed from the blended statutory tax rate for the same period due to losses in non-U.S.

jurisdictions for which we do not realize tax benefits.

First Three Quarters

Our effective tax rate was 32.1% and 34.3% for the nine months ended September 30, 2024 and September 30, 2023, respectively.

The effective tax rate for the nine months ended September 30, 2024 differed from the blended statutory tax rate for the same period due to income tax adjustments for discrete items, including a $27 million decrease attributable to the expiration of statutes of limitation on certain unrecognized tax benefits (inclusive of interest and penalties) and an $8 million net decrease related to changes in valuation allowances in non-U.S.

jurisdictions, partially offset by a $28 million increase to remove the permanent reinvestment assertion for our earnings in certain non-U.S.

entities and a $3 million increase for deferred non-U.S.

withholding taxes.

The effective tax rate for the nine months ended September 30, 2023 differed from the blended statutory tax rate for the same period due to income tax adjustments for discrete items, including an $18 million increase to pre-acquisition reserves for unrecognized tax benefits.

The Organization for Economic Co-operation and Development has proposed a global minimum tax of 15% of reported profits (“Pillar 2”) that has been agreed upon in principle by over 140 non-U.S.

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We continuously monitor the capital markets to evaluate the effect that changes in market conditions may have on our ability to fund our liquidity needs.

At June 30, 2024, our corporate debt, net of cash and equivalents, to Adjusted EBITDA ratio was 4.4, above our targeted range of 2.5 to 3.0, and our goal is to reduce this ratio to 3.0 by the end of 2025.

At September 30, 2024, our corporate debt, net of cash and equivalents, to Adjusted EBITDA ratio was 3.9, above our targeted range of 2.5 to 3.0, and we remain focused on reducing this ratio by the end of 2025.

In the second quarter of 2024, we amended the Corporate Credit Facility to provide for a new $800 million term loan facility that is scheduled to mature on April 1, 2031, the New Term Loan.

15 unchanged sentences

If a pool of securitized vacation ownership notes receivable fails to perform within the pool’s parameters (default or delinquency thresholds vary by transaction), transaction provisions effectively redirect the monthly excess spread of interest accruing on the related vacation ownership notes receivable less the interest accruing on the ABS securities and fees we would otherwise receive from that pool (attributable to the interests we retained) to accelerate the principal payments to investors (taking into account the subordination of the different tranches to the extent there are multiple tranches) until the performance trigger is cured.

During the second quarter of 2024, and as of June 30, 2024, we had 14 term securitization transactions outstanding, all of which were in compliance with their respective required parameters.

During the third quarter of 2024, and as of September 30, 2024, we had 15 term securitization transactions outstanding, all of which were in compliance with their respective required parameters.

Since 2000, we have issued approximately $9.8 billion of debt securities in securitization transactions in the term ABS market, excluding amounts securitized through warehouse credit facilities or private bank transactions.

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Those loans may later be transferred to term securitization transactions in the ABS market, which typically occur twice a year.

During the second quarter of 2024, we amended certain agreements associated with our Warehouse Credit Facility, which extended the revolving

period from May 31, 2025 to June 11, 2026.

At June 30, 2024, we had $108 million of borrowings outstanding under our Warehouse Credit Facility.

As of June 30, 2024, $71 million of gross vacation ownership notes receivable were eligible for securitization.

During the second quarter of 2024, we amended certain agreements associated with our Warehouse Credit Facility, which extended the revolving period from May 31, 2025 to June 11, 2026.

At September 30, 2024, we had no borrowings outstanding under our Warehouse Credit Facility.

As of September 30, 2024, $70 million of gross vacation ownership notes receivable were eligible for securitization.

Revolving Corporate Credit Facility

Our Revolving Corporate Credit Facility, which expires on March 31, 2027, provides for up to $750 million of aggregate borrowings for general corporate needs, including working capital, capital expenditures, letters of credit, and acquisitions.

At June 30, 2024, $175 million of borrowings and $32 million of le tters of credit were outstanding under our Revolving Corporate Credit Facility.

At September 30, 2024, $75 million of borrowings and $20 million of le tters of credit were outstanding under our Revolving Corporate Credit Facility.

We minimize our working capital needs through cash management, strict credit-granting policies, and disciplined collection efforts.

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In addition, during the first quarter of each year, we typically have significant variable compensation-related cash outflows associated with payment of annual bonuses.

Timing of Estimated Tax Payments

The Internal Revenue Service provided for the deferral of federal income tax payments as tax relief for businesses in parts of Florida affected by the hurricanes that occurred during the third and fourth quarters of 2024.

This relief allows us to delay making certain estimated tax payments, without interest or penalty.

As a result, we expect to defer $28 million of payments from 2024 to the second quarter of 2025.

Similarly, in the prior year, $32 million of estimated tax payments from the third and fourth quarters of 2023 were deferred to the first quarter 2024 related to hurricanes that occurred in 2023.

In addition to net income and adjustments for non-cash items, the following are key drivers of our cash flow from operating activities:

Inventory Spending Less Than Cost of Sales

Six Months Ended

($ in millions) June 30, 2024 June 30, 2023

Inventory Spending (In Excess of) Less Than Cost of Sales

Nine Months Ended

($ in millions) September 30, 2024 September 30, 2023

Inventory spending $ (159) $ (56)

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Inventory costs 107 137

Inventory spending less than cost of sales $ 4 $ 49

Inventory spending (in excess of) less than cost of sales $ (52) $ 54

Although we have significant inventory on hand, we intend to continue selectively pursuing growth opportunities by targeting high-quality inventory that allows us to add desirable new destinations to our systems with new on-site sales locations.

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Among other reasons for repurchasing inventory, we expect these repurchases will help stabilize the future cost of our vacation ownership products.

Our spending for real estate inventory in the first half of 2024 was lower than cost of sales and was primarily related to purchases under our VOI repurchase programs.

Purchase of property for future transfer to inventory in 2023 included the acquisition of property in Charleston, South Carolina.

We expect inventory spending to exceed cost of sales for the remainder of 2024, due to our remaining commitment to acquire property in Waikiki.

Our spending for real estate inventory in the first three quarters of 2024 was higher than cost of sales due to our acquisition of vacation ownership units in Waikiki and purchases under our VOI repurchase programs.

Refer to Footnote 3 “Acquisitions” for information about acquisitions that occurred during the first three quarters of 2024.

Purchases of property for future transfer to inventory in 2023 included the acquisition of property in Charleston, South Carolina and Savannah, Georgia.

We expect inventory spending to continue to exceed cost of sales for the remainder of 2024.

Vacation Ownership Notes Receivable Collections Less Than Originations

Six Months Ended

($ in millions) June 30, 2024 June 30, 2023

Nine Months Ended

($ in millions) September 30, 2024 September 30, 2023

Vacation ownership notes receivable collections — non-securitized $ 67 $ 119

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Vacation ownership notes receivable collections less than originations $ (268) $ (288)

We expect vacation ownership notes receivable originations to continue to outpace vacation ownership notes receivable collections in 2024 due to sales growth.

We expect vacation ownership notes receivable originations to continue to outpace vacation ownership notes receivable collections in the remainder of 2024.

Repurchase of Common Stock

3 unchanged sentences

As of December 31, 2023 25,141,073 $ 2,405 $ 95.65

For the first half of 2024 410,377 36 $ 88.99

As of June 30, 2024 25,551,450 $ 2,441 $ 95.55

For the first three quarters of 2024 530,377 45 $ 85.45

As of September 30, 2024 25,671,450 $ 2,450 $ 95.44

See Footnote 13 “Stockholders' Equity” to our Financial Statements for further information related to our current share repurchase program.

Payment of Dividends to Common Stockholders

We distributed cash dividends to holders of common stock during the first half of 2024 as follows:

We distributed cash dividends to holders of common stock during the first three quarters of 2024 as follows:

Declaration Date Stockholder Record Date

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Material Cash Requirements

The following table summarizes our future material cash requirements from known contractual or other obligations as of June 30, 2024:

The following table summarizes our future material cash requirements from known contractual or other obligations as of September 30, 2024:

Payments Due by Period

29 unchanged sentences

The guarantees of the Senior Notes Guarantors are subject to release in limited circumstances only upon the occurrence of certain customary conditions.

The following tables present consolidating financial information as of June 30, 2024 and December 31, 2023, and for the six months ended June 30, 2024 for MVWC and MORI on a stand-alone basis (collectively, the “Issuers”), the Senior Notes Guarantors, the combined non-guarantor subsidiaries of MVWC, and MVW on a consolidated basis.

The following tables present consolidating financial information as of September 30, 2024 and December 31, 2023, and for the nine months ended September 30, 2024 for MVWC and MORI on a stand-alone basis (collectively, the “Issuers”), the Senior Notes Guarantors, the combined non-guarantor subsidiaries of MVWC, and MVW on a consolidated basis.

Condensed Consolidating Statement of Income

Six Months Ended June 30, 2024

Nine Months Ended September 30, 2024

Issuers Senior Notes Guarantors Non-Guarantor Subsidiaries Total Eliminations MVW Consolidated

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Condensed Consolidating Balance Sheet

As of June 30, 2024

As of September 30, 2024

Issuers Senior Notes Guarantors Non-Guarantor Subsidiaries Total Eliminations MVW Consolidated

51 unchanged sentences

Recent Accounting Pronouncements

See Footnote 2 “Significant Accounting Policies and Recent Accounting Standards” to our Financial Statements for a discussion of recently issued accounting pronouncements, including information on new accounting standards and the future adoption of such standards.

See Footnote 2 “Significant Accounting Policies and Recent Accounting Standards” to our Financial Statements for a discussion of recently issued accounting pronouncements, including information about new accounting standards and the future adoption of such standards.

Critical Accounting Policies and Estimates

3 unchanged sentences

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-Q

Item 2. Management’s Discussion and Analysis