Document and Entity Information
Document and Entity Information - shares | 9 Months Ended | |
Sep. 30, 2018 | Nov. 02, 2018 | |
Document And Entity Information [Abstract] | ||
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | Sep. 30, 2018 | |
Document Fiscal Year Focus | 2,018 | |
Document Fiscal Period Focus | Q3 | |
Trading Symbol | VAC | |
Entity Registrant Name | Marriott Vacations Worldwide Corporation | |
Entity Central Index Key | 1,524,358 | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Large Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Common Stock, Shares Outstanding | 47,037,330 |
INTERIM CONSOLIDATED STATEMENTS
INTERIM CONSOLIDATED STATEMENTS OF INCOME - USD ($) $ in Millions | Sep. 06, 2018 | May 14, 2018 | Feb. 16, 2018 | Sep. 30, 2018 | Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 |
REVENUES | ||||||||
Revenue from contracts with customers | $ 702 | $ 496 | $ 1,797 | $ 1,522 | ||||
Financing | 48 | 34 | 119 | 99 | ||||
Cost reimbursements | 234 | 177 | 652 | 561 | ||||
TOTAL REVENUES | $ 470 | 750 | 530 | 1,916 | 1,621 | |||
EXPENSES | ||||||||
Marketing and sales | 135 | 94 | 346 | 287 | ||||
Rental | 19 | 11 | 40 | 30 | ||||
General and administrative | 53 | 26 | 114 | 81 | ||||
Depreciation and amortization | 18 | 6 | 29 | 16 | ||||
Litigation settlement | 17 | 2 | 33 | 2 | ||||
Royalty fee | 19 | 15 | 50 | 47 | ||||
Cost reimbursements | 234 | 177 | 652 | 561 | ||||
TOTAL EXPENSES | 490 | 698 | 472 | 1,762 | 1,444 | |||
Gains (losses) and other income (expense), net | 2 | 7 | (4) | 7 | ||||
Interest expense | (5) | (14) | (2) | (23) | (5) | |||
ILG acquisition-related costs | (72) | (108) | 0 | (128) | (1) | |||
Other | 0 | 0 | (3) | 0 | ||||
(LOSS) INCOME BEFORE INCOME TAXES AND NONCONTROLLING INTERESTS | (68) | 63 | (4) | 178 | ||||
Benefit (provision) for income taxes | 29 | 10 | (23) | (7) | (62) | |||
NET (LOSS) INCOME | (68) | (58) | 40 | (11) | 116 | |||
Net income attributable to noncontrolling interests | 0 | 0 | 0 | 0 | 0 | |||
NET (LOSS) INCOME ATTRIBUTABLE TO COMMON SHAREHOLDERS | $ (68) | $ (58) | $ 40 | $ (11) | $ 116 | |||
(LOSSES) EARNINGS PER SHARE ATTRIBUTABLE TO COMMON SHAREHOLDERS | ||||||||
Basic (in usd per share) | $ (1.75) | $ 1.49 | $ (0.37) | $ 4.27 | ||||
Diluted (in usd per share) | (1.75) | 1.45 | (0.37) | 4.18 | ||||
CASH DIVIDENDS DECLARED PER SHARE (in usd per share) | $ 0.40 | $ 0.40 | $ 0.40 | $ 0.40 | $ 0.35 | $ 1.20 | $ 1.05 | |
Sale of vacation ownership products | ||||||||
REVENUES | ||||||||
Revenue from contracts with customers | $ 252 | $ 183 | $ 632 | $ 549 | ||||
EXPENSES | ||||||||
Expenses | 64 | 46 | 167 | 141 | ||||
Resort management and other services | ||||||||
REVENUES | ||||||||
Revenue from contracts with customers | 126 | 70 | 274 | 209 | ||||
EXPENSES | ||||||||
Expenses | 65 | 38 | 140 | 111 | ||||
Rental | ||||||||
REVENUES | ||||||||
Revenue from contracts with customers | 90 | 66 | 239 | 203 | ||||
EXPENSES | ||||||||
Expenses | $ 74 | $ 57 | $ 191 | $ 168 |
INTERIM CONSOLIDATED STATEMEN_2
INTERIM CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | |
Statement of Comprehensive Income [Abstract] | ||||
Net (loss) income | $ (58) | $ 40 | $ (11) | $ 116 |
Other comprehensive income (loss): | ||||
Foreign currency translation adjustments | 0 | 5 | 0 | 12 |
Derivative instrument adjustment, net of tax | 0 | 0 | (1) | 0 |
Total other comprehensive income (loss), net of tax | 0 | 5 | (1) | 12 |
TOTAL COMPREHENSIVE (LOSS) INCOME, NET OF TAX | (58) | 45 | (12) | 128 |
Less: Net income attributable to noncontrolling interests | 0 | 0 | 0 | 0 |
Less: Other comprehensive income attributable to noncontrolling interests | 0 | 0 | 0 | 0 |
Total comprehensive income attributable to noncontrolling interests | 0 | 0 | 0 | 0 |
TOTAL COMPREHENSIVE (LOSS) INCOME, NET OF TAX | $ (58) | $ 45 | $ (12) | $ 128 |
INTERIM CONSOLIDATED BALANCE SH
INTERIM CONSOLIDATED BALANCE SHEETS - USD ($) $ in Millions | Sep. 30, 2018 | Dec. 31, 2017 |
ASSETS | ||
Cash and cash equivalents | $ 441 | $ 409 |
Restricted cash (including $130 and $32 from VIEs, respectively) | 365 | 82 |
Accounts receivable, net (including $10 and $6 from VIEs, respectively) | 236 | 92 |
Vacation ownership notes receivable, net (including $1,557 and $814 from VIEs, respectively) | 1,959 | 1,115 |
Inventory | 829 | 398 |
Property and equipment | 952 | 583 |
Goodwill | 2,747 | 0 |
Intangibles, net | 1,216 | 0 |
Other (including $28 and $14 from VIEs, respectively) | 268 | 166 |
TOTAL ASSETS | 9,013 | 2,845 |
LIABILITIES AND EQUITY | ||
Accounts payable | 181 | 145 |
Contract Liabilities | 449 | 153 |
Accrued liabilities (including $2 and $1 from VIEs, respectively) | 370 | 120 |
Payroll and benefits liability | 194 | 112 |
Deferred compensation liability | 94 | 75 |
Securitized debt, net (including $1,701 and $845 from VIEs, respectively) | 835 | |
Debt, net | 2,235 | 260 |
Other | 15 | 14 |
Deferred taxes | 266 | 90 |
TOTAL LIABILITIES | 5,492 | 1,804 |
Contingencies and Commitments (Note 9) | ||
Preferred stock — $0.01 par value; 2,000,000 shares authorized; none issued or outstanding | 0 | 0 |
Common stock — $0.01 par value; 100,000,000 shares authorized; 57,611,046 and 36,861,843 shares issued, respectively | 1 | 0 |
Treasury stock — at cost; 10,405,594 and 10,400,547 shares, respectively | (696) | (694) |
Additional paid-in capital | 3,697 | 1,189 |
Accumulated other comprehensive income | 16 | 17 |
Retained earnings | 478 | 529 |
TOTAL MVW SHAREHOLDERS' EQUITY | 3,496 | 1,041 |
Noncontrolling interests | 25 | 0 |
TOTAL EQUITY | 3,521 | 1,041 |
TOTAL LIABILITIES AND EQUITY | 9,013 | 2,845 |
Advance deposits | ||
LIABILITIES AND EQUITY | ||
Contract Liabilities | 124 | 84 |
Deferred revenue | ||
LIABILITIES AND EQUITY | ||
Contract Liabilities | 325 | 69 |
Variable Interest Entity | ||
ASSETS | ||
Restricted cash (including $130 and $32 from VIEs, respectively) | 130 | 32 |
Accounts receivable, net (including $10 and $6 from VIEs, respectively) | 10 | 6 |
Vacation ownership notes receivable, net (including $1,557 and $814 from VIEs, respectively) | 1,557 | 814 |
Other (including $28 and $14 from VIEs, respectively) | 28 | 14 |
LIABILITIES AND EQUITY | ||
Accrued liabilities (including $2 and $1 from VIEs, respectively) | 2 | 1 |
Securitized debt, net (including $1,701 and $845 from VIEs, respectively) | $ 1,701 | $ 845 |
INTERIM CONSOLIDATED BALANCE _2
INTERIM CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Millions | Sep. 30, 2018 | Dec. 31, 2017 |
Restricted cash | $ 365 | $ 82 |
Accounts receivable, net | 236 | 92 |
Vacation ownership notes receivable, net | 1,959 | 1,115 |
Other | 268 | 166 |
Accrued liabilities | 370 | 120 |
Securitized debt, net | 835 | |
Other | $ 15 | $ 14 |
Preferred stock, par value (in usd per share) | $ 0.01 | $ 0.01 |
Preferred stock, shares authorized (in shares) | 2,000,000 | 2,000,000 |
Preferred stock, issued (in shares) | 0 | 0 |
Preferred stock, outstanding (in shares) | 0 | 0 |
Common stock, Par (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized (in shares) | 100,000,000 | 100,000,000 |
Common stock, shares issued (in shares) | 57,611,046 | 36,861,843 |
Treasury stock, shares (in shares) | 10,405,594 | 10,400,547 |
Variable Interest Entity | ||
Restricted cash | $ 130 | $ 32 |
Accounts receivable, net | 10 | 6 |
Vacation ownership notes receivable, net | 1,557 | 814 |
Other | 28 | 14 |
Accrued liabilities | 2 | 1 |
Securitized debt, net | $ 1,701 | $ 845 |
INTERIM CONSOLIDATED STATEMEN_3
INTERIM CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2018 | Sep. 30, 2017 | |
OPERATING ACTIVITIES | ||
Net (loss) income | $ (11,000) | $ 116,000 |
Adjustments to reconcile net (loss) income to net cash and restricted cash provided by operating activities: | ||
Depreciation and amortization of intangibles | 29,000 | 16,000 |
Amortization of debt discount and issuance costs | 12,000 | 6,000 |
Accretion of acquired vacation ownership notes receivable | (1,000) | 0 |
Vacation ownership notes receivable reserve | 42,000 | 40,000 |
Share-based compensation | 19,000 | 12,000 |
Deferred income taxes | 2,000 | 23,000 |
Net change in assets and liabilities, net of the effects of acquisition: | ||
Accounts receivable | (9,000) | 23,000 |
Vacation ownership notes receivable originations | (395,000) | (345,000) |
Vacation ownership notes receivable collections | 244,000 | 204,000 |
Inventory | 68,000 | 26,000 |
Purchase of vacation ownership units for future transfer to inventory | 0 | (34,000) |
Other assets | 53,000 | 34,000 |
Accounts payable, advance deposits and accrued liabilities | (13,000) | (78,000) |
Deferred revenue | 38,000 | 10,000 |
Payroll and benefit liabilities | (29,000) | 1,000 |
Deferred compensation liability | 11,000 | 10,000 |
Other liabilities | 1,000 | 0 |
Other, net | 6,000 | 7,000 |
Net cash and restricted cash provided by operating activities | 67,000 | 71,000 |
INVESTING ACTIVITIES | ||
Acquisition of a business, net of cash and restricted cash acquired | (1,393,000) | 0 |
Capital expenditures for property and equipment (excluding inventory) | (17,000) | (21,000) |
Purchase of company owned life insurance | (13,000) | (12,000) |
Net cash and restricted cash used in investing activities | (1,423,000) | (33,000) |
FINANCING ACTIVITIES | ||
Borrowings from securitization transactions | 423,000 | 400,000 |
Repayment of debt related to securitization transactions | (264,000) | (232,000) |
Proceeds from debt | 1,650,000 | 318,000 |
Repayments of debt | (53,000) | (88,000) |
Purchase of Convertible Note Hedges | 0 | (33,000) |
Proceeds from issuance of Warrants | 0 | 20,000 |
Debt issuance costs | (34,000) | (14,000) |
Repurchase of common stock | (2,000) | (83,000) |
Payment of dividends | (32,000) | (29,000) |
Payment of withholding taxes on vesting of restricted stock units | (17,000) | (11,000) |
Net cash and restricted cash (used in) provided by financing activities | 1,671,000 | 248,000 |
Effect of changes in exchange rates on cash, cash equivalents and restricted cash | 0 | 3,000 |
Increase in cash, cash equivalents and restricted cash | 315,000 | 289,000 |
Cash, cash equivalents and restricted cash, beginning of period | 491,000 | 213,000 |
Cash, cash equivalents and restricted cash, end of period | 806,000 | 502,000 |
SUPPLEMENTAL DISCLOSURES OF NON-CASH INVESTING AND FINANCING ACTIVITIES | ||
Non-cash issuance of debt in connection with acquisition of vacation ownership units | 0 | 64,000 |
Non-cash issuance of stock in connection with ILG Acquisition | 2,505,000 | 0 |
Dividends payable | 19,000 | 9,000 |
SUPPLEMENTAL DISCLOSURES | ||
Interest paid, net of amounts capitalized | 28,000 | 16,000 |
Income taxes paid, net of refunds | $ 18,000 | $ 38,000 |
INTERIM CONSOLIDATED STATEMEN_4
INTERIM CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITY Statement - 9 months ended Sep. 30, 2018 - USD ($) $ in Millions | Total | Common Stock | Treasury Stock | Additional Paid-In Capital | Accumulated Other Comprehensive Income | Retained Earnings | Total MVW Shareholders' Equity | Noncontrolling Interests |
Balance (in shares) at Dec. 31, 2017 | 36,861,843 | |||||||
Balance at Dec. 31, 2017 | $ 1,041 | $ 0 | $ (694) | $ 1,189 | $ 17 | $ 529 | $ 1,041 | $ 0 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Net loss | $ (11) | (11) | (11) | |||||
ILG Acquisition (in shares) | 20,500,000 | |||||||
ILG Acquisition | $ 2,466 | 1 | 2,440 | 2,441 | 25 | |||
Derivative instrument adjustment | $ (1) | (1) | (1) | |||||
Amounts related to share-based compensation (in shares) | 200,000 | |||||||
Amounts related to share-based compensation | $ 68 | 68 | 68 | |||||
Repurchase of common stock (in shares) | 0 | 13,969 | ||||||
Repurchase of common stock | $ (2) | $ (2) | (2) | |||||
Dividends | $ (40) | (40) | (40) | |||||
Balance (in shares) at Sep. 30, 2018 | 57,611,046 | |||||||
Balance at Sep. 30, 2018 | $ 3,521 | $ 1 | $ (696) | $ 3,697 | $ 16 | $ 478 | $ 3,496 | $ 25 |
SUMMARY OF SIGNIFICANT ACCOUNTI
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 9 Months Ended |
Sep. 30, 2018 | |
Accounting Policies [Abstract] | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES The Interim Consolidated Financial Statements present the results of operations, financial position and cash flows of Marriott Vacations Worldwide Corporation (“we,” “us,” “Marriott Vacations Worldwide,” “MVW” or the “Company,” which includes our consolidated subsidiaries except where the context of the reference is to a single corporate entity). In order to make this report easier to read, we refer throughout to (i) our Interim Consolidated Financial Statements as our “Financial Statements,” (ii) our Interim Consolidated Statements of Income as our “Income Statements,” (iii) our Interim Consolidated Balance Sheets as our “Balance Sheets” and (iv) our Interim Consolidated Statements of Cash Flows as our “Cash Flows.” In addition, references throughout to numbered “Footnotes” refer to the numbered Notes in these Notes to Interim Consolidated Financial Statements, unless otherwise noted. We use certain other terms that are defined within these Financial Statements. The Financial Statements presented herein and discussed below include 100 percent of the assets, liabilities, revenues, expenses and cash flows of Marriott Vacations Worldwide, all entities in which Marriott Vacations Worldwide has a controlling voting interest (“subsidiaries”), and those variable interest entities for which Marriott Vacations Worldwide is the primary beneficiary in accordance with consolidation accounting guidance. References in these Financial Statements to net income attributable to common shareholders and MVW shareholders’ equity do not include noncontrolling interests, which represent the outside ownership of our consolidated non-wholly owned entities and are reported separately. Intercompany accounts and transactions between consolidated companies have been eliminated in consolidation. These Financial Statements reflect our financial position, results of operations and cash flows as prepared in conformity with United States Generally Accepted Accounting Principles (“GAAP”). In our opinion, our Financial Statements reflect all normal and recurring adjustments necessary to present fairly our financial position, the results of our operations and cash flows for the periods presented. Interim results may not be indicative of fiscal year performance because of, among other reasons, the ILG Acquisition (defined below), seasonal and short-term variations. These Financial Statements have not been audited. We have condensed or omitted certain information and footnote disclosures normally included in financial statements presented in accordance with GAAP. Although we believe our footnote disclosures are adequate to make the information presented not misleading, the Financial Statements in this report should be read in conjunction with the consolidated financial statements and notes thereto recast for the adoption of Accounting Standards Update (“ASU”) 2014-09 “ Revenue from Contracts with Customers (Topic 606), ” as amended (“ASU 2014-09”) included in our Current Report on Form 8-K, filed with the U.S. Securities and Exchange Commission on June 5, 2018. The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect amounts reported in the financial statements and accompanying notes. Such estimates include, but are not limited to, revenue recognition, allocations of the purchase price paid in business combinations, cost of vacation ownership products, inventory valuation, goodwill and intangibles valuation, property and equipment valuation, accounting for acquired vacation ownership mortgages receivable, vacation ownership notes receivable reserves, income taxes and loss contingencies. Accordingly, actual amounts may differ from these estimated amounts. Acquisition of ILG On September 1, 2018 , we completed the previously announced acquisition of ILG, LLC, formerly known as ILG, Inc. (“ILG”) through a series of transactions, after which ILG became our indirect wholly-owned subsidiary (the “ ILG Acquisition ”). The Financial Statements in this report include ILG’s results of operations for the 30 days ended September 30, 2018 and reflect the financial position of our combined company at September 30, 2018. We refer to our business associated with brands that existed prior to the ILG Acquisition as “Legacy-MVW” and to ILG’s business and brands that we acquired as “Legacy-ILG.” See Footnote 2 “Acquisitions and Dispositions” for more information on the ILG Acquisition . Business Combinations We allocate the purchase price of an acquisition to the tangible and intangible assets acquired and liabilities assumed based on their estimated fair values at the acquisition date. We recognize as goodwill the amount by which the purchase price of an acquired entity exceeds the net of the fair values assigned to the assets acquired and liabilities assumed. In determining the fair values of assets acquired and liabilities assumed, we use various recognized valuation methods including the income, cost and market approaches. Further, we make assumptions within certain valuation techniques, including discount rates, royalty rates, and the amount and timing of future cash flows. We record the net assets and results of operations of an acquired entity in our Financial Statements from the acquisition date. We initially perform these valuations based upon preliminary estimates and assumptions by management or independent valuation specialists under our supervision, where appropriate, and make revisions as estimates and assumptions are finalized. We expense acquisition-related costs as we incur them. See Footnote 2 “Acquisitions and Dispositions” for additional information. Goodwill We test goodwill for potential impairment at least annually, or more frequently if an event or other circumstance indicates that we may not be able to recover the carrying amount of the net assets of the reporting unit. In evaluating goodwill for impairment, we may assess qualitative factors to determine whether it is more likely than not (that is, a likelihood of more than 50 percent) that the fair value of a reporting unit is less than its carrying amount. If we bypass the qualitative assessment, or if we conclude that it is more likely than not that the fair value of a reporting unit is less than its carrying value, then we perform a quantitative impairment test by comparing the fair value of a reporting unit with its carrying amount. Intangibles and Long-Lived Assets We assess indefinite-lived intangible assets for potential impairment and continued indefinite use annually, or more frequently if an event or other circumstance indicates that we may not be able to recover the carrying amount of the asset. We may first assess qualitative factors to determine whether it is more likely than not that the fair value of the indefinite-lived intangible is less than its carrying amount. If the carrying value of the asset exceeds the fair value, we recognize an impairment loss in the amount of that excess.We test definite-lived intangibles and long-lived asset groups for recoverability when changes in circumstances indicate that we may not be able to recover the carrying value; for example, when there are material adverse changes in projected revenues or expenses, significant underperformance relative to historical or projected operating results, or significant negative industry or economic trends. We also test recoverability when management has committed to a plan to sell or otherwise dispose of an asset group and we expect to complete the plan within a year. We evaluate recoverability of an asset group by comparing its carrying value to the future net undiscounted cash flows that we expect the asset group will generate. If the comparison indicates that we will not be able to recover the carrying value of an asset group, we recognize an impairment loss for the amount by which the carrying value exceeds the estimated fair value. When we recognize an impairment loss for assets to be held and used, we depreciate the adjusted carrying amount of those assets over their remaining useful life.We calculate the estimated fair value of an intangible asset or asset group using the income approach. For the income approach, we use internally developed discounted cash flow models that include the following assumptions, among others: projections of revenues, expenses, and related cash flows based on assumed long-term growth rates and demand trends; expected future investments to grow; and estimated discount rates. Restricted Cash Restricted cash primarily consists of cash restricted for use by consolidated property owners’ associations which is designated for resort operations and other specific uses, such as reserves, cash held in a reserve account related to vacation ownership notes receivable securitizations, cash collected for maintenance fees to be remitted to property owners’ associations, and deposits received and held in escrow, primarily associated with the sale of vacation ownership products. Reclassifications We have reclassified the following prior year amounts to conform to the current year presentation: • Reclassified Resort management and other services revenue to Management and exchange revenue; • Reclassified Resort management and other services expense to Management and exchange expense; • Consolidated Consumer financing interest expense into Financing expense; • Reclassified depreciation expense from Marketing and sales expense, Management and exchange expense, Rental expense, and General and administrative expense to Depreciation and amortization expense; • Reclassified costs related to the ILG Acquisition from Other expense to ILG acquisition-related costs; • Reclassified $330 million of land and infrastructure from Inventory to Property and equipment at December 31, 2017; and • Reclassified $835 million of debt associated with vacation ownership notes receivable securitization, net of unamortized debt issuance costs from Debt, net to Securitized debt, net at December 31, 2017. New Accounting Standards Accounting Standards Update 2018-05 – “ Income Taxes (Topic 740): Amendments to SEC Paragraphs Pursuant to SEC Staff Accounting Bulletin No. 118 ” (“ASU 2018-05”) In March 2018, the Financial Accounting Standards Board (“FASB”) issued ASU 2018-05, which updates the income tax accounting in GAAP to reflect the interpretive guidance in Staff Accounting Bulletin (“SAB”) 118 (“SAB 118”), that was issued by the staff of the Securities and Exchange Commission in December 2017 in order to address the application of GAAP in situations where a registrant does not have all the necessary information available, prepared, or analyzed (including computations) in reasonable detail to complete the accounting for certain income tax effects of the Tax Cuts and Jobs Act (“the “Tax Act”). SAB 118 provides for a provisional one year measurement period for registrants to finalize their accounting for certain income tax effects related to the Tax Act. ASU 2018-05 was effective upon issuance. We expect to finalize our provisional amounts related to the Tax Act by the fourth quarter of 2018. See Footnote 4 “Income Taxes” for additional information. Accounting Standards Update 2016-01 – “ Financial Instruments – Overall (Subtopic 825-10) ” (“ASU 2016-01”) In January 2016, the FASB issued ASU 2016-01, which updates certain aspects of recognition, measurement, presentation and disclosure of financial instruments. For public business entities, the amendments in ASU 2016-01 will be effective for fiscal years beginning after December 15, 2017, including interim periods within those fiscal years. The adoption of ASU 2016-01 in the first quarter of 2018 did not have a material impact on our financial statements or disclosures. Accounting Standards Update 2016-16 – “ Income Taxes (Topic 740): Intra-Entity Transfers of Assets Other Than Inventory ” (“ASU 2016-16”) In October 2016, the FASB issued ASU 2016-16, which changes the timing of when certain intercompany transactions are recognized within the provision for income taxes. This update is effective for public companies for annual periods beginning after December 15, 2017, and for annual periods and interim periods thereafter, with early adoption permitted. The adoption of ASU 2016-16 in the first quarter of 2018 did not have a material impact on our financial statements or disclosures. Accounting Standards Update 2014-09 – “ Revenue from Contracts with Customers (Topic 606) ” (“ASU 2014-09”), as Amended In May 2014, the FASB issued ASU 2014-09, which, as amended, created Accounting Standards Codification (“ASC”) Topic 606, “ Revenue from Contracts with Customers ” (“ASC 606”), and supersedes the revenue recognition requirements in ASC Topic 605, “ Revenue Recognition, ” including most industry-specific guidance, and significantly enhances comparability of revenue recognition practices across entities and industries by providing a principle-based, comprehensive framework for addressing revenue recognition issues. In order for a provider of promised goods or services to recognize as revenue the consideration that it expects to receive in exchange for the promised goods or services, the provider should apply the following five steps: (1) identify the contract with a customer; (2) identify the performance obligations in the contract; (3) determine the transaction price; (4) allocate the transaction price to the performance obligations in the contract; and (5) recognize revenue when (or as) the entity satisfies a performance obligation. ASU 2014-09, as amended, is effective for annual reporting periods, and interim periods within those reporting periods, beginning after December 15, 2017. The new standard may be applied retrospectively or on a modified retrospective basis with the cumulative effect recognized on the date of adoption. We adopted ASU 2014-09, as amended (the new “Revenue Standard”), effective January 1, 2018, the first day of our 2018 fiscal year, on a retrospective basis and restated our previously reported historical results. See Footnote 16 “Adoption Impact of New Revenue Standard” for further discussion of adoption and the impact on our previously reported historical results. See Footnote 3 “Revenue” for additional information on how we recognize revenue. Future Adoption of Accounting Standards Accounting Standards Update 2017-12 – “ Derivatives and Hedging (Topic 815): Targeted Improvements to Accounting for Hedging Activities ” (“ASU 2017-12”) In August 2017, the FASB issued ASU 2017-12, which amends and simplifies existing guidance in order to allow companies to better portray the economic effects of risk management activities in the financial statements and enhance the transparency and understandability of the results of hedging activities. ASU 2017-12 eliminates the requirement to separately measure and report hedge ineffectiveness and generally requires the entire change in the fair value of a hedging instrument to be presented in the same income statement line as the hedged item. The guidance also eases certain documentation and assessment requirements. This update is effective for public companies for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years, with early adoption permitted. We expect to adopt ASU 2017-12 commencing in fiscal year 2019 and are continuing to evaluate the impact that adoption of this update will have on our financial statements and disclosures. Accounting Standards Update 2016-13 – “ Financial Instruments – Credit Losses (Topic 326), Measurement of Credit Losses on Financial Instruments ” (“ASU 2016-13”) In June 2016, the FASB issued ASU 2016-13, which replaces the incurred loss impairment methodology in current GAAP with a methodology that reflects expected credit losses. The update is intended to provide financial statement users with more decision-useful information about the expected credit losses on financial instruments and other commitments to extend credit held by a reporting entity at each reporting date. This update is effective for fiscal years beginning after December 15, 2019, including interim periods within those fiscal years, with early adoption permitted for fiscal years beginning after December 15, 2018. We expect to adopt ASU 2016-13 commencing in fiscal year 2019 and are continuing to evaluate the impact that adoption of this update will have on our financial statements and disclosures. Accounting Standards Update 2016-02 – “ Leases (Topic 842) ” (“ASU 2016-02”) In February 2016, the FASB issued ASU 2016-02 to increase transparency and comparability of information regarding an entity’s leasing activities by providing additional information to users of financial statements. ASU 2016-02 requires lessees to recognize most leases on their balance sheet by recording a liability for its lease obligation and an asset for its right to use the underlying asset as of the lease commencement date and recognizing expenses on the income statement in a similar manner to the current guidance in Accounting Standards Codification 840, Leases (“ASC 840”). Lessor accounting will remain largely unchanged, other than certain targeted improvements intended to align lessor accounting with the lessee accounting model and with the updated revenue recognition guidance. Upon adoption of ASU 2016-02, as amended, leases will be classified as either finance or operating, with classification affecting the geography of expense recognition in the income statement. Additionally, enhanced quantitative and qualitative disclosures regarding leases are required. ASU 2016-02 is effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years, with early adoption permitted. As permitted by the amended guidance, we intend to elect to retain the original lease classification and historical accounting for existing or expired contracts of lessees and lessors so that we will not be required to reassess whether such contracts contain leases, the lease classification, or the initial direct costs. Additionally, with respect to our real estate leases, we intend to elect an accounting policy by class of underlying asset to combine lease and non-lease components. We do not intend to utilize the practical expedient which allows the use of hindsight by lessees and lessors in determining the lease term and in assessing impairment of its right-of-use assets. We plan to adopt ASU 2016-02, as amended, using the transition method which allows the application of the standard at the adoption date, January 1, 2019, and will recognize a cumulative-effect adjustment to the opening balance of retained earnings in the period of adoption. We are continuing our implementation efforts and evaluating the impact that adoption of ASU 2016-02, as amended, will have on our financial statements and disclosures, including for example, any potential changes to and investments in policies, processes, systems and internal controls over financial reporting that may be required to comply with the new guidance related to identifying and measuring right-of-use assets and lease liabilities. |
ACQUISITIONS AND DISPOSITIONS
ACQUISITIONS AND DISPOSITIONS | 9 Months Ended |
Sep. 30, 2018 | |
Business Combinations [Abstract] | |
ACQUISITIONS AND DISPOSITIONS | ACQUISITIONS AND DISPOSITIONS Acquisitions ILG Acquisition On September 1, 2018 , (the “ Acquisition Date ”), we completed the ILG Acquisition . ILG is a leading provider of professionally delivered vacation experiences and the exclusive global licensee for the Hyatt, Sheraton and Westin brands in vacation ownership. The combination of our brands creates a leading global provider of upper-upscale vacation ownership, exchange networks and management services with access to world-class loyalty programs and an expanded portfolio of highly demanded vacation destinations. Shareholders of ILG received 0.165 shares of our common stock and $14.75 in cash for each share of ILG common stock. The following table presents the fair value of each class of consideration transferred at the Acquisition Date. (in millions, except per share amounts) Equivalent shares of Marriott Vacations Worldwide common stock issued in exchange for ILG outstanding shares 20.5 Marriott Vacations Worldwide common stock price as of Acquisition Date $ 119.00 Fair value of Marriott Vacations Worldwide common stock issued in exchange for ILG outstanding shares 2,441 Cash consideration to ILG shareholders, net of cash acquired of $154 million 1,680 Fair value of ILG equity-based awards attributed to pre-combination service 64 Total consideration transferred, net of cash acquired 4,185 Noncontrolling interests 25 $ 4,210 Preliminary Fair Values of Assets Acquired and Liabilities Assumed We accounted for the ILG Acquisition as a business combination, which requires us to record the assets acquired and liabilities assumed at fair value as of the Acquisition Date. We commenced the appraisals necessary to assess the fair values of the tangible and intangible assets acquired and liabilities assumed and the amount of goodwill to be recognized as of the Acquisition Date. The amounts recorded for certain assets and liabilities are preliminary in nature and are subject to adjustment as additional information is obtained about the facts and circumstances that existed as of the Acquisition Date. The final determination of the fair values of certain assets and liabilities will be completed within the measurement period of up to one year from the Acquisition Date, as permitted under GAAP. The size and breadth of the ILG Acquisition could necessitate the need to use the full one year measurement period to adequately analyze and assess a number of the factors used in establishing the asset and liability fair values as of the Acquisition Date. The final values may also result in changes to amortization expense related to intangible assets and depreciation expense related to property and equipment. Any potential adjustments made could be material in relation to the values presented in the table below. The following table presents our preliminary estimates of the fair values of the assets that we acquired and the liabilities that we assumed in connection with the business combination. ($ in millions) Vacation ownership notes receivable $ 736 Inventory 494 Property and equipment 384 Intangible assets 1,223 Other assets 581 Deferred revenue (217 ) Deferred taxes (174 ) Debt (392 ) Securitized debt from VIEs (696 ) Other liabilities (476 ) Net assets acquired 1,463 Goodwill (1) 2,747 $ 4,210 _________________________ (1) Goodwill is calculated as total consideration transferred, net of cash acquired, less identified net assets acquired and it primarily represents the value that we expect to obtain from synergies and growth opportunities from our combined operations. We have not completed the assignment of goodwill to our reporting units as of the date of this report, and it is not deductible for tax purposes. Vacation Ownership Notes Receivable We acquired vacation ownership notes receivable which consist of loans to customers who purchased vacation ownership products and chose to finance their purchase. These vacation ownership notes receivable are collateralized by the underlying vacation ownership interests (“VOIs”) and generally have terms ranging from five to 15 years. We provisionally estimated the fair value of the vacation ownership notes receivables using a discounted cash flow model, which calculated a present value of expected future cash flows over the term of the respective vacation ownership notes receivable (Level 2). We are continuing to evaluate the significant assumptions underlying the discounted cash flow model including default and prepayment assumptions, which could result in changes to our provisional estimate. See Footnote 5 “Vacation Ownership Notes Receivable” for additional information. Inventory We acquired inventory which consists of completed unsold VOIs and vacation ownership projects under construction. We provisionally estimated the value of acquired inventory using an income approach, which is primarily based on significant Level 3 assumptions, such as estimates of future income growth, capitalization rates, discount rates and capital expenditure needs of the relevant properties. We are continuing to assess the market assumptions and property conditions, which could result in changes to these provisional values. Property and Equipment We acquired property and equipment, which includes four owned hotels, information technology, ancillary business assets, furniture and equipment and land held for future development. We provisionally estimated the value of the property and equipment using a combination of the income, cost, and market approaches, which are primarily based on significant Level 3 assumptions, such as estimates of future income growth, capitalization rates, discount rates, and capital expenditure needs of the hotels. We are continuing to assess the market assumptions and property conditions, which could result in changes to these provisional values. Intangible Assets The following table presents our preliminary estimates of the fair values of ILG’s identified intangible assets and their related estimated useful lives. Estimated Fair Value ($ in millions) Estimated Useful Life (in years) Member relationships $ 754 10 to 15 Management contracts 354 15 to 25 Management contracts (1) 33 indefinite Trade names and trademarks 82 indefinite $ 1,223 _________________________ (1) The indefinite-lived management contracts, by their terms, continue for the foreseeable horizon. There are no legal, regulatory, contractual, competitive, economic or other factors which limit the period of time over which these resort management contracts are expected to contribute future cash flows. We provisionally estimated the value of ILG’s trade names and trademarks using the relief-from-royalty method, which applies an estimated royalty rate to forecasted future cash flows, discounted to present value. We estimated the value of management contracts and member relationships using the multi-period excess earnings method, which is a variation of the income approach. This method estimates an intangible asset’s value based on the present value of the incremental after-tax cash flows attributable to the intangible asset. These valuation approaches utilize Level 3 inputs, and we continue to review ILG’s contracts and historical performance in addition to evaluating the inputs, including the discount rates and renewal and growth assumptions, which could result in changes to these provisional values. Deferred Revenue Deferred revenue primarily relates to membership fees, which are deferred and recognized over the terms of the applicable memberships, typically ranging from one to five years, on a straight-line basis. Additionally, deferred revenue includes maintenance fees collected from owners, in certain cases, which are earned by the relevant property owners’ association over the applicable period. We provisionally estimated the value of ILG’s deferred revenue utilizing Level 3 inputs based on a review of existing deferred revenue balances against ILG’s legal performance obligations. We continue to review ILG’s contracts in addition to evaluating the inputs, including the discount rates, which could result in changes to the provisional estimate. Deferred Income Taxes Deferred income taxes primarily relate to the fair value of assets and liabilities acquired from ILG, including vacation ownership notes receivable, inventory, property and equipment, intangible assets, and debt. We provisionally estimated deferred income taxes based on statutory rates in the jurisdictions of the legal entities where the acquired assets and liabilities are recorded. We are continuing to assess the tax rates used, and we will update our estimate of deferred income taxes based on changes to our provisional valuations of the related assets and liabilities and refinement of the effective tax rates, which could result in changes to these provisional values. Debt We valued the IAC Notes (as defined in Footnote 12 “Debt”) using a quoted market price, which is considered a Level 2 input as it is observable in the market; however these notes have only a limited trading volume and as such this fair value estimate is not necessarily indicative of the value at which the IAC Notes could be retired or transferred.The carrying value of the ILG Revolving Credit Facility (as defined in Footnote 12 “Debt”) approximated fair value, as the contractual interest rate was variable plus an applicable margin based credit rating (Level 3 input). The ILG Revolving Credit Facility was extinguished and all amounts due were repaid in full subsequent to the completion of the ILG Acquisition. Securitized Debt from VIEs We provisionally estimated the fair value of the securitized debt from VIEs using a discounted cash flow model. The significant assumptions in our analysis include default rates, prepayment rates, bond interest rates and other structural factors (Level 3 inputs). We are continuing to evaluate the significant assumptions underlying the discounted cash flow model including default and prepayment assumptions, which could result in changes to our provisional estimate. Lease Obligations The following table presents the future minimum lease obligations that we assumed in the ILG Acquisition and for which we are the primary obligor as of September 30, 2018: ($ in millions) Operating Leases 2018, remaining $ 5 2019 19 2020 17 2021 12 2022 9 Thereafter 76 Total minimum lease payments $ 138 Most leases have initial terms of up to 5 years, with some containing one or more renewals at our option, generally for 1 or 3 year periods, and generally contain fixed and in some cases variable components, which are primarily based on the operating performance of the leased property. Pro Forma Results of Operations The following unaudited pro forma information presents the combined results of operations of Marriott Vacations Worldwide and ILG as if we had completed the ILG Acquisition on December 30, 2016, the last day of our 2016 fiscal year, but using our preliminary fair values of assets and liabilities as of the Acquisition Date. As required by GAAP, these unaudited pro forma results do not reflect any synergies from operating efficiencies. Accordingly, these unaudited pro forma results are presented for informational purposes only and are not necessarily indicative of what the actual results of operations of the combined company would have been if the ILG Acquisition had occurred at the beginning of the period presented, nor are they indicative of future results of operations. Nine Months Ended ($ in millions, except per share data) September 30, 2018 September 30, 2017 Revenues $ 3,172 $ 2,946 Net income (loss) $ 78 $ (17 ) Net income (loss) attributable to common stockholders $ 76 $ (19 ) (LOSSES) EARNINGS PER SHARE ATTRIBUTABLE TO COMMON SHAREHOLDERS Basic $ 1.54 $ (0.39 ) Diluted $ 1.50 $ (0.38 ) The unaudited pro forma results include $34 million and $169 million of ILG acquisition-related costs for the nine months ended September 30, 2018 and September 30, 2017, respectively. ILG Results of Operations The following table presents the results of ILG operations included in our Income Statement for the 30 days from the Acquisition Date through the end of the third quarter of 2018. ($ in millions) September 1, 2018 to September 30, 2018 Revenue $ 135 Net loss $ (25 ) Marco Island, Florida During the first quarter of 2018, we acquired 20 completed vacation ownership units located at our resort in Marco Island, Florida for $24 million . The transaction was accounted for as an asset acquisition with all of the purchase price allocated to Inventory. See Footnote 9 “Contingencies and Commitments” for information on our remaining commitment related to this property. During the second quarter of 2017, we acquired 36 completed vacation ownership units located at our resort in Marco Island, Florida for $34 million . The transaction was accounted for as an asset acquisition with all of the purchase price allocated to Property and equipment. To ensure consistency with the expected related future cash flow presentation, the cash purchase price was included as an operating activity in the Purchase of vacation ownership units for future transfer to inventory line on our Cash Flows for the nine months ended September 30, 2017. Big Island of Hawaii During the second quarter of 2017, we acquired 112 completed vacation ownership units located on the Big Island of Hawaii. The transaction was accounted for as an asset acquisition with all of the purchase price allocated to Inventory. As consideration for the acquisition, we paid $27 million in cash, settled a note receivable from the seller of less than $1 million on a noncash basis, and issued a non-interest bearing note payable for $64 million |
REVENUE
REVENUE | 9 Months Ended |
Sep. 30, 2018 | |
Revenue from Contract with Customer [Abstract] | |
REVENUE | REVENUE We account for revenue in accordance with ASC 606, “ Revenue from Contracts with Customers ,” which we adopted on January 1, 2018, using the retrospective method. See Footnote 1 “Summary of Significant Accounting Policies” for additional information and Footnote 16 “Adoption Impact of New Revenue Standard” for further discussion of the adoption and the impact on our previously reported historical results. Sources of Revenue by Segment Three Months Ended September 30, 2018 ($ in millions) Vacation Ownership Exchange & Third-Party Management Corporate and Other Total Sale of vacation ownership products $ 252 $ — $ — $ 252 Ancillary revenues 42 — — 42 Management fee revenues 28 8 (1 ) 35 Other services revenues 21 20 8 49 Management and exchange 91 28 7 126 Rental 86 4 — 90 Cost reimbursements 232 8 (6 ) 234 Revenue from contracts with customers 661 40 1 702 Financing 48 — — 48 Total Revenues $ 709 $ 40 $ 1 $ 750 Three Months Ended September 30, 2017 ($ in millions) Vacation Ownership Exchange & Third-Party Management Corporate and Other Total Sale of vacation ownership products $ 183 $ — $ — $ 183 Ancillary revenues 31 — — 31 Management fee revenues 23 — — 23 Other services revenues 16 — — 16 Management and exchange 70 — — 70 Rental 66 — — 66 Cost reimbursements 177 — — 177 Revenue from contracts with customers 496 — — 496 Financing 34 — — 34 Total Revenues $ 530 $ — $ — $ 530 Nine Months Ended September 30, 2018 ($ in millions) Vacation Ownership Exchange & Third-Party Management Corporate and Other Total Sale of vacation ownership products $ 632 $ — $ — $ 632 Ancillary revenues 106 — — 106 Management fee revenues 78 8 (1 ) 85 Other services revenues 55 20 8 83 Management and exchange 239 28 7 274 Rental 235 4 — 239 Cost reimbursements 650 8 (6 ) 652 Revenue from contracts with customers 1,756 40 1 1,797 Financing 119 — — 119 Total Revenues $ 1,875 $ 40 $ 1 $ 1,916 Nine Months Ended September 30, 2017 ($ in millions) Vacation Ownership Exchange & Third-Party Management Corporate and Other Total Sale of vacation ownership products $ 549 $ — $ — $ 549 Ancillary revenues 91 — — 91 Management fee revenues 67 — — 67 Other services revenues 51 — — 51 Management and exchange 209 — — 209 Rental 203 — — 203 Cost reimbursements 561 — — 561 Revenue from contracts with customers 1,522 — — 1,522 Financing 99 — — 99 Total Revenues $ 1,621 $ — $ — $ 1,621 Timing of Revenue from Contracts with Customers by Segment Three Months Ended September 30, 2018 ($ in millions) Vacation Ownership Exchange & Third-Party Management Corporate and Other Total Services transferred over time $ 367 $ 23 $ 1 $ 391 Goods or services transferred at a point in time 294 17 — 311 Revenue from contracts with customers $ 661 $ 40 $ 1 $ 702 Three Months Ended September 30, 2017 ($ in millions) Vacation Ownership Exchange & Third-Party Management Corporate and Other Total Services transferred over time $ 278 $ — $ — $ 278 Goods or services transferred at a point in time 218 — — 218 Revenue from contracts with customers $ 496 $ — $ — $ 496 Nine Months Ended September 30, 2018 ($ in millions) Vacation Ownership Exchange & Third-Party Management Corporate and Other Total Services transferred over time $ 1,010 $ 23 $ 1 $ 1,034 Goods or services transferred at a point in time 746 17 — 763 Revenue from contracts with customers $ 1,756 $ 40 $ 1 $ 1,797 Nine Months Ended September 30, 2017 ($ in millions) Vacation Ownership Exchange & Third-Party Management Corporate and Other Total Services transferred over time $ 867 $ — $ — $ 867 Goods or services transferred at a point in time 655 — — 655 Revenue from contracts with customers $ 1,522 $ — $ — $ 1,522 Sale of Vacation Ownership Products We market and sell vacation ownership products in our Vacation Ownership segment. Vacation ownership products include deeded vacation ownership products, deeded beneficial interests, rights to use real estate and other interests in trusts that solely hold real estate (collectively “vacation ownership products” or VOIs). Vacation ownership products may be sold for cash or we may provide financing. In connection with the sale of vacation ownership products, we provide sales incentives to certain purchasers and, in certain cases, membership in a brand affiliated club. Non-cash incentives typically include Marriott Rewards points, Hyatt’s customer loyalty program points (“World of Hyatt” points) or an alternative sales incentive that we refer to as “plus points.” Plus points are redeemable for stays at our resorts or for use in an exclusive selection of travel packages provided by affiliate tour operators (the “Explorer Collection”), generally up to two years from the date of issuance. Typically, sales incentives are only awarded if the sale is closed. Upon execution of a legal sales agreement, we typically receive an upfront deposit from our customer with the remainder of the purchase price for the vacation ownership product to either be collected at closing (“cash contract”) or financed by the customer through our financing programs (“financed contract”). Refer to “ Financing Revenues ” below for further information regarding financing terms. Customer deposits received for contracts are recorded as Advance deposits on our Balance Sheets until the point in time at which control of the vacation ownership product has transferred to the customer. Our assessment of collectibility of the transaction price for sales of vacation ownership products is aligned with our credit granting policies for financed contracts. In determining the consideration to which we expect to be entitled for financed contracts, we include estimated variable consideration in the transaction price to the extent it is probable that a significant reversal of cumulative revenue recognized will not occur when the uncertainty associated with the variable consideration is resolved. Our estimates of variable consideration and determination of whether to include estimated amounts in the transaction price are based largely on the customer class and the results of our static pool analyses, which rely on historical payment data by customer class. Variable consideration which has not been included within the transaction price is presented as a reserve on vacation ownership notes receivable. Revisions to estimates of variable consideration from the sale of vacation ownership products impact the reserve on vacation ownership notes receivable and can increase or decrease revenue. Revenues were reduced during the third quarter and first three quarters of 2018 by $1 million and $3 million , respectively, due to changes in our estimate of variable consideration for performance obligations that were satisfied in prior periods. In addition, we account for cash incentives provided to customers as a reduction of the transaction price. Refer to “ Arrangements with Multiple Performance Obligations ” below for a description of our methods of allocating transaction price to each performance obligation. We evaluated our business practices, and the underlying risks and rewards associated with vacation ownership products and the respective timing that such risks and rewards are transferred to the customer in determining the point in time at which control of the vacation ownership product is transferred to the customer. Based upon the different terms of the contracts with the customer and business practices, we transfer control of the vacation ownership product at different times for Legacy-MVW and Legacy-ILG. We recognize revenue on the sale of Legacy-MVW vacation ownership products at closing. We recognize revenue on the sale of Legacy-ILG vacation ownership products upon expiration of the rescission period and completion of construction. Revenue for non-cash incentives, such as plus points, is recorded as Deferred revenue on our Balance Sheets at closing and is recognized as rental revenue upon transfer of control to the customer, which typically occurs upon delivery of the incentive, or at the point in time when the incentive is redeemed. For non-cash incentives provided by third parties (i.e. Marriott Rewards points, World of Hyatt points or third-party Explorer Collection offerings), we evaluated whether we control the underlying good or service prior to delivery to the customer. We concluded that we are an agent for those non-cash incentives which we do not control prior to delivery and as such record the related revenue net of the related cost upon recognition. Management and Exchange Revenues and Cost Reimbursements Revenues Ancillary Revenues Ancillary revenues consist of goods and services that are sold or provided by us at food and beverage outlets, golf courses and other retail and service outlets located at our resorts. Payments for such goods and services are generally received at the point of sale in the form of cash or credit card charges. For goods and services sold, we evaluate whether we control the underlying goods or services prior to delivery to the customer. For transactions where we do not control the goods or services prior to delivery, the related revenue is recorded net of the related cost upon recognition. We recognize ancillary revenue at the point in time when goods have been provided and/or services have been rendered. Management Fee Revenues and Cost Reimbursements Revenues We provide day-to-day-management services, including housekeeping services, operation of reservation systems, maintenance and certain accounting and administrative services for property owners’ associations, condominium owners and hotels. We generate revenue from fees we earn for managing vacation ownership resorts, condominiums and hotels. In our Vacation Ownership segment, these fees are earned regardless of usage or occupancy and are typically based on either a percentage of the budgeted costs to operate the resorts or a fixed fee arrangement (“VO management fee revenues”). In our Exchange & Third-Party Management segment, we earn base management fees which are typically either (i) fixed amounts, (ii) amounts based on a percentage of adjusted gross lodging revenue, or (iii) various revenue sharing agreements based on stated formulas (“Base management fee revenues”) and incentive management fees, which are generally a percentage of either operating profits or improvement in operating profits (“Incentive management fees”). In addition, we receive reimbursement of costs incurred on behalf of our customers, which consist of actual expenses with no added margin (“cost reimbursements”). Vacation Ownership segment cost reimbursements revenues exclude amounts that we have paid to the property owners’ associations related to maintenance fees for unsold vacation ownership products, as we have concluded that such payments are consideration payable to a customer. Management fees are collected over time or upfront depending upon the specific management contract. Cost reimbursements are received over time and considered variable consideration. We have determined that a significant financing component does not exist as a substantial amount of the consideration promised by the customer is paid when the associated variable consideration is determined. We evaluated the nature of the management services provided and concluded that the management services constitute a series of distinct services to be accounted for as a single performance obligation transferred over time. We use an input method, the number of days that management services are provided, to recognize VO management fee revenues and Base management fee revenues, which is consistent with the pattern of transfer to the customers who receive and consume the benefits as services are provided each day. We recognize incentive management fees as earned throughout the incentive period based on actual results, which is subject to estimation of the transaction price. Any consideration we receive in advance of services being rendered is recorded as Deferred revenue on our Balance Sheets and is recognized ratably across the service period to which it relates. We recognize variable consideration for Cost reimbursements revenues when the reimbursable costs are incurred. Other Services Revenues Other services revenues includes revenues from membership fees, club dues and additional fees for services we provide to customers. Membership fees and club dues are received in advance of providing access to the exchange services, are recorded as Deferred revenue on our Balance Sheets and are earned regardless of whether exchange services are provided. Generally, Interval International memberships are cancelable and refundable on a pro-rata basis, with the exception of the Interval Network’s Platinum tier which is non-refundable. Transaction-based fees are typically collected at a point in time. We have determined that exchange services constitute a stand-ready obligation for us to provide unlimited access to exchange services over a defined period of time, when and if a customer (or customer of a customer) requests. We have determined that customers benefit from the stand-ready obligation evenly throughout the period in which the customer has access to exchange services and as such, recognize membership fees and club dues on a straight-line basis over the related period of time. Transaction-based fees are recognized as revenue at the point in time at which the relevant goods or services are transferred to the customer. For transaction-based fees, we evaluate whether we control the underlying goods or services prior to delivery to the customer. Transaction-based fees from exchanges and other transactions in our Exchange & Third-Party Management segment are generally recognized when confirmation of the transaction is provided and services have been rendered. For transactions where we do not control the goods or services prior to delivery, the related revenue is recorded net of the related cost upon recognition. Financing Revenues We offer consumer financing as an option to qualifying customers purchasing vacation ownership products, which is collateralized by the underlying vacation ownership products. We recognize interest income on an accrual basis. The contractual terms of the financing agreements require that the contractual level of annual principal payments be sufficient to amortize the loan over a customary period for the vacation ownership product being financed, which is generally ten years. Generally, payments commence under the financing contracts 30 to 60 days after closing. We record the difference between the vacation ownership note receivable and the variable consideration included in the transaction price for the sale of the related vacation ownership product as a reserve on our vacation ownership notes receivable. We earn interest income from the financing arrangements on the principal balance outstanding over the life of the arrangement and record that interest income in Financing revenues on our Income Statements. Financing revenues include transaction-based fees we charge to owners and other third parties for services. We recognize fee revenues when services have been rendered. Rental Revenues We generate revenue from rentals of inventory that we hold for sale as interests in our vacation ownership programs, inventory that we control because our owners have elected alternative usage options permitted under our vacation ownership programs and rentals of owned-hotel properties. In addition, in our Exchange & Third-Party Management segment, we offer vacation rental opportunities to members of the Interval Network and certain other membership programs from seasonal oversupply or underutilized space, as well as resort accommodations. We receive payments for rentals primarily through credit card charges. We recognize rental revenues when occupancy has occurred, which is consistent with the period in which the customer benefits from such service. We recognize rental revenue from the utilization of plus points issued in connection with the sale of vacation ownership products as described in “ Sale of Vacation Ownership Products ” above. We also generate revenues from vacation packages sold to our customers. The packages have an expiration period of six to twenty-four months, and payments for such packages are non-refundable and generally paid by the customer in advance. Payments received in advance are recorded as Advance deposits on our Balance Sheets, until the revenue is recognized, when occupancy has occurred. For rental revenues associated with vacation ownership products which we own and which are registered and held for sale, to the extent that the proceeds are less than costs, revenues are reported net in accordance with ASC Topic 978, “ Real Estate – Time-Sharing Activities .” Arrangements with Multiple Performance Obligations Our contracts with customers may include multiple performance obligations. For such arrangements, we allocate revenue to each performance obligation based on its relative standalone selling price. In cases where the standalone selling price is not readily available, we generally determine the standalone selling prices utilizing the adjusted market approach, using prices from similar contracts, our historical pricing on similar contracts, our internal marketing and selling data and other internal and external inputs we deem to be appropriate. Significant judgment is required in determining the standalone selling price under the adjusted market approach. Deferred Revenue in a Business Combination When we acquire a business which records deferred revenue on its historical financial statements, we are required to re-measure that deferred revenue as of the acquisition date pursuant to the rules related to accounting for business combinations. The post-acquisition impact of that re-measurement results in recognizing revenue which solely comprises the cost of the associated legal performance obligation we assumed as part of the acquisition, plus a normal profit margin. This accounting treatment typically results in lower amounts of revenue recognized in a reporting period following an acquisition than would have been recognized on a historical basis. Receivables, Contract Assets & Contract Liabilities As discussed above, the payment terms and conditions in our customer contracts vary. In some cases, customers prepay for their goods and services; in other cases, after appropriate credit evaluations, payment is due in arrears. When the timing of our delivery of goods and services is different from the timing of the payments made by customers, we recognize either a contract asset (performance precedes contractual due date) or a contract liability (customer payment precedes performance or when we have a right to consideration that is unconditional before the transfer of goods or services to a customer). Receivables are recorded when the right to consideration becomes unconditional. Contract liabilities are recognized as revenue as (or when) we perform under the contract. The following table shows the composition of our receivables and contract liabilities. We had no contract assets at either September 30, 2018 or December 31, 2017 . ($ in millions) At September 30, 2018 At December 31, 2017 Receivables Accounts receivable $ 46 $ 73 Vacation ownership notes receivable, net 1,959 1,115 $ 2,005 $ 1,188 Contract Liabilities Advance deposits $ 124 $ 84 Deferred revenue 325 69 $ 449 $ 153 Revenue recognized in the third quarter and first three quarters of 2018 that was included in our contract liabilities balance at December 31, 2017 was $13 million and $107 million , respectively. Remaining Performance Obligations Our remaining performance obligations represent the expected transaction price allocated to our contracts that we expect to recognize as revenue in future periods when we perform under the contracts. At September 30, 2018 , 90 percent of this amount is expected to be recognized as revenue over the next two As discussed in Footnote 1 “Summary of Significant Accounting Policies,” the FASB issued ASU 2014-09 in 2014, which, as amended, created ASC 606. The core principle of ASC 606 is that an entity shall recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The standard also contains significant new disclosure requirements regarding the nature, amount, timing and uncertainty of revenue and cash flows arising from contracts with customers. We adopted ASC 606 effective January 1, 2018, on a retrospective basis and restated our previously reported historical results as shown in the tables below. Upon adoption of the new Revenue Standard, recognition of revenue from the sale of vacation ownership products that is deemed collectible is now deferred from the point in time at which the statutory rescission period expires to closing, when control of the vacation ownership product is transferred to the customer. In addition, we aligned our assessment of collectibility of the transaction price for sales of vacation ownership products with our credit granting policies. We elected the practical expedient to expense all marketing and sales costs as they are incurred. Our consolidated cost reimbursements revenues and cost reimbursements expenses increased significantly, as all costs reimbursed to us by property owners’ associations are now reported on a gross basis upon adoption of the new Revenue Standard. In conjunction with the adoption of the new Revenue Standard we reclassified certain revenues and expenses. As part of the adoption of the new Revenue Standard, we elected the following practical expedients and accounting policies: • We expense all marketing and sales costs that we incur to sell vacation ownership products when incurred. • In determining the transaction price for contracts from customers, we exclude all taxes assessed by a governmental authority that are both imposed on and concurrent with a specific revenue-product transaction and collected by the entity from a customer (e.g., sales tax). • We do not disclose the amount of the transaction price allocated to the remaining performance obligations as of December 31, 2017 or provide an explanation of when we expect to recognize that amount as revenue. The following tables present the impact of the adoption of the new Revenue Standard on our previously reported historical results for the periods presented. Income Statement Impact - Third Quarter of 2017 Three Months Ended September 30, 2017 ($ in millions) As Reported ASC 606 Adjustments Conforming Reclassifications (1) As Adjusted REVENUES Sale of vacation ownership products $ 180 $ 3 $ — $ 183 Resort management and other services 77 (7 ) (70 ) — Management and exchange — — 70 70 Rental 81 (15 ) — 66 Financing 34 — — 34 Cost reimbursements 114 63 — 177 TOTAL REVENUES 486 44 — 530 EXPENSES Cost of vacation ownership products 43 3 — 46 Marketing and sales 100 (4 ) (2 ) 94 Resort management and other services 45 (5 ) (40 ) — Management and exchange — — 38 38 Rental 71 (13 ) (1 ) 57 Financing 5 — 6 11 General and administrative 27 — (1 ) 26 Depreciation and amortization — — 6 6 Litigation settlement 2 — — 2 Consumer financing interest 6 — (6 ) — Royalty fee 15 — — 15 Cost reimbursements 114 63 — 177 TOTAL EXPENSES 428 44 — 472 Gains and other income, net 7 — — 7 Interest expense (2 ) — — (2 ) INCOME BEFORE INCOME TAXES AND NONCONTROLLING INTERESTS 63 — — 63 Provision for income taxes (22 ) (1 ) — (23 ) NET INCOME 41 (1 ) — 40 Net income attributable to noncontrolling interests — — — — NET INCOME ATTRIBUTABLE TO COMMON SHAREHOLDERS $ 41 $ (1 ) $ — $ 40 Earnings per share - Basic $ 1.50 $ (0.01 ) $ — $ 1.49 Earnings per share - Diluted $ 1.47 $ (0.02 ) $ — $ 1.45 _________________________ (1) We have reclassified certain prior year amounts to conform to our current quarter presentation. See Footnote 1 “Summary of Significant Accounting Policies” for a description of the reclassifications. Income Statement Impact - First Three Quarters of 2017 Nine Months Ended September 30, 2017 ($ in millions) As Reported ASC 606 Adjustments Conforming Reclassifications (1) As Adjusted REVENUES Sale of vacation ownership products $ 544 $ 5 $ — $ 549 Resort management and other services 229 (20 ) (209 ) — Management and exchange — — 209 209 Rental 250 (47 ) — 203 Financing 99 — — 99 Cost reimbursements 348 213 — 561 TOTAL REVENUES 1,470 151 — 1,621 EXPENSES Cost of vacation ownership products 132 9 — 141 Marketing and sales 305 (13 ) (5 ) 287 Resort management and other services 130 (13 ) (117 ) — Management and exchange — — 111 111 Rental 212 (42 ) (2 ) 168 Financing 12 — 18 30 General and administrative 84 — (3 ) 81 Depreciation and amortization — — 16 16 Litigation settlement 2 — — 2 Consumer financing interest 18 — (18 ) — Royalty fee 47 — — 47 Cost reimbursements 348 213 — 561 TOTAL EXPENSES 1,290 154 — 1,444 Gains and other income, net 7 — — 7 Interest expense (5 ) — — (5 ) ILG acquisition costs — — (1 ) (1 ) Other (1 ) — 1 — INCOME BEFORE INCOME TAXES AND NONCONTROLLING INTERESTS 181 (3 ) — 178 Provision for income taxes (62 ) — — (62 ) NET INCOME 119 (3 ) — 116 Net income attributable to noncontrolling interests — — — — NET INCOME ATTRIBUTABLE TO COMMON SHAREHOLDERS $ 119 $ (3 ) $ — $ 116 Earnings per share - Basic $ 4.36 $ (0.09 ) $ — $ 4.27 Earnings per share - Diluted $ 4.26 $ (0.08 ) $ — $ 4.18 _________________________ (1) We have reclassified certain prior year amounts to conform to our current quarter presentation. See Footnote 1 “Summary of Significant Accounting Policies” for a description of the reclassifications. Balance Sheet Impact As of December 31, 2017 ($ in millions) As Reported ASC 606 Adjustments Conforming Reclassifications (1) As Adjusted ASSETS Cash and cash equivalents $ 409 $ — $ — $ 409 Restricted cash 82 — — 82 Accounts receivable, net 154 (62 ) — 92 Vacation ownership notes receivable, net 1,120 (5 ) — 1,115 Inventory 716 12 (330 ) 398 Property and equipment 253 — 330 583 Other 172 (6 ) — 166 TOTAL ASSETS $ 2,906 $ (61 ) $ — $ 2,845 LIABILITIES AND EQUITY Accounts payable $ 145 $ — $ — $ 145 Advance deposits 63 21 — 84 Accrued liabilities 168 (48 ) — 120 Deferred revenue 98 (29 ) — 69 Payroll and benefits liability 112 — — 112 Deferred compensation liability 75 — — 75 Securitized debt — — 835 835 Debt, net 1,095 — (835 ) 260 Other 14 — — 14 Deferred taxes 91 (1 ) — 90 TOTAL LIABILITIES 1,861 (57 ) — 1,804 Preferred stock — — — — Common stock — — — — Treasury stock (694 ) — — (694 ) Additional paid-in capital 1,189 — — 1,189 Accumulated other comprehensive income 17 — — 17 Retained earnings 533 (4 ) — 529 TOTAL EQUITY 1,045 (4 ) — 1,041 TOTAL LIABILITIES AND EQUITY $ 2,906 $ (61 ) $ — $ 2,845 ___________________ (1) We have reclassified certain prior year amounts to conform to our current quarter presentation. See Footnote 1 “Summary of Significant Accounting Policies” for a description of the reclassifications. Cash Flow Impact - Operating Activities Nine Months Ended September 30, 2017 ($ in millions) As Reported Adjustments As Adjusted OPERATING ACTIVITIES Net income $ 119 $ (3 ) $ 116 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation 16 — 16 Amortization of debt discount and issuance costs 6 — 6 Vacation ownership notes receivable reserve 38 2 40 Share-based compensation 12 — 12 Deferred income taxes 21 2 23 Net change in assets and liabilities: Accounts receivable 25 (2 ) 23 Vacation ownership notes receivable originations (346 ) 1 (345 ) Vacation ownership notes receivable collections 204 — 204 Inventory 28 (2 ) 26 Purchase of vacation ownership units for future transfer to inventory (34 ) — (34 ) Other assets 23 11 34 Accounts payable, advance deposits and accrued liabilities (65 ) (13 ) (78 ) Deferred revenue 7 3 10 Payroll and benefit liabilities 1 — 1 Deferred compensation liability 10 — 10 Other liabilities (1 ) 1 — Other, net 7 — 7 Net cash provided by operating activities $ 71 $ — $ 71 |
INCOME TAXES
INCOME TAXES | 9 Months Ended |
Sep. 30, 2018 | |
Income Tax Disclosure [Abstract] | |
INCOME TAXES | INCOME TAXES We file income tax returns with U.S. federal and state and non-U.S. jurisdictions and are subject to audits in these jurisdictions. Although we do not anticipate that a significant impact to our unrecognized tax benefit balance will occur during the next fiscal year, the amount of our liability for unrecognized tax benefits could change as a result of audits in these jurisdictions. Our total unrecognized tax benefit balance that, if recognized, would impact our effective tax rate, was $2 million at both September 30, 2018 and December 31, 2017 . Our interim effective tax rate was (177.62) percent and 34.76 percent for the nine months ended September 30, 2018 and September 30, 2017 , respectively. As our pre-tax net loss for three and nine months ended September 30, 2018 is disproportionate to our estimated fiscal year 2018 pre-tax net income, our effective tax rate for the corresponding periods will vary significantly. This is attributed to the exclusion of tax benefits associated with pre-tax losses generated in jurisdictions that have full valuation allowances and the ILG acquisition-related costs incurred in the third quarter of 2018. Our annual effective tax rate is expected to be approximately 45.98 percent for fiscal year 2018. During December 2017, the Tax Act was signed into law, effective January 1, 2018, resulting in a significant change in the framework for U.S. corporate taxes, including but not limited to, the reduction of the U.S. corporate tax rate from 35 percent to 21 percent. In accordance with SAB 118, we remeasured our deferred tax assets and liabilities using the new corporate tax rate of 21 percent, rather than the previous corporate tax rate of 35 percent, resulting in a $65 million decrease in our income tax expense for the year ended December 31, 2017 and a corresponding $65 million decrease in our net deferred tax liability as of December 31, 2017. During the third quarter of 2018, the Internal Revenue Service issued additional guidance on the executive compensation portion of the Tax Act and upon application of the new guidance we recorded an adjustment of $2 million to the provisional amount recorded at December 31, 2017. However, other than the adjustment related to executive compensation, as of September 30, 2018 , the amounts remain provisional and additional work is necessary to complete our detailed analysis. The one-time transition tax on certain un-repatriated earnings of foreign subsidiaries is based on total post-1986 earnings and profits that we previously deferred from U.S. income taxes. We performed a preliminary analysis of the transition tax and determined that, due to deficits in foreign earnings and profits, we did not have a one-time transition tax liability to record in 2017. As of September 30, 2018 , we have not finalized our calculations of our transition tax liability, if any. As the one-time transition tax is based in part on the amount of those earnings held in cash and other specified assets, we may determine that we have a one-time transition tax liability when we finalize the calculation of post-1986 foreign earnings and profits previously deferred from U.S. federal taxation and finalize the amounts held in cash or other specified assets. No additional income taxes have been provided for any remaining undistributed foreign earnings not subject to the transition tax, or any additional outside basis difference inherent in these entities, as these amounts continue to be indefinitely reinvested in foreign operations. |
VACATION OWNERSHIP NOTES RECEIV
VACATION OWNERSHIP NOTES RECEIVABLE | 9 Months Ended |
Sep. 30, 2018 | |
Receivables [Abstract] | |
VACATION OWNERSHIP NOTES RECEIVABLE | VACATION OWNERSHIP NOTES RECEIVABLE The following table shows the composition of our vacation ownership notes receivable balances, net of reserves. September 30, 2018 December 31, 2017 ($ in millions) Originated Acquired Total Originated Acquired Total Securitized $ 990 $ 567 $ 1,557 $ 814 $ — $ 814 Non-securitized Eligible for securitization (1) 57 86 143 142 — 142 Not eligible for securitization (1) 207 52 259 159 — 159 Subtotal 264 138 402 301 — 301 $ 1,254 $ 705 $ 1,959 $ 1,115 $ — $ 1,115 _________________________ (1) Refer to Footnote 6 “Financial Instruments” for a discussion of eligibility of our vacation ownership notes receivable for securitization. We reflect interest income associated with vacation ownership notes receivable in our Income Statements in the Financing revenues caption. The following table summarizes interest income associated with vacation ownership notes receivable: Three Months Ended Nine Months Ended ($ in millions) September 30, 2018 September 30, 2017 September 30, 2018 September 30, 2017 Interest income associated with vacation ownership notes receivable — securitized $ 42 $ 27 $ 95 $ 73 Interest income associated with vacation ownership notes receivable — non-securitized 3 6 18 21 Total interest income associated with vacation ownership notes receivable $ 45 $ 33 $ 113 $ 94 Acquired Vacation Ownership Notes Receivable As part of the ILG Acquisition , we acquired existing portfolios of vacation ownership notes receivable. These notes receivable are accounted for using the expected cash flow method of recognizing discount accretion based on the expected cash flows from the acquired vacation ownership notes receivable pursuant to ASC 310-30, “ Loans acquired with deteriorated credit quality ” (“ASC 310-30”). At acquisition, we recorded these acquired vacation ownership notes receivable at a preliminary estimate of fair value, including a credit discount which is accreted as an adjustment to yield over the estimated life of the vacation ownership notes receivable. The fair value of our acquired vacation ownership notes receivable as of the Acquisition Date was determined using a discounted cash flow method, which calculated a present value of expected future cash flows based on scheduled principal and interest payments over the term of the respective vacation ownership notes receivable, while considering anticipated defaults and early repayments based on historical experience. Consequently, the fair value of the acquired vacation ownership notes receivable recorded on our balance sheet as of the Acquisition Date included an estimate for future uncollectible amounts which became the historical cost basis for that portfolio going forward. The table below presents a rollforward from the Acquisition Date of the accretable yield (interest income) expected to be earned related to our acquired vacation ownership notes receivable, as well as the amount of non-accretable difference at the end of the period. The non-accretable difference represents estimated contractually required payments in excess of estimated cash flows expected to be collected. The accretable yield represents the excess of estimated cash flows expected to be collected over the carrying amount of the acquired vacation ownership notes receivable. ($ in millions) 30 Days Ended September 30, 2018 Balance at Acquisition Date $ — Acquired accretable yield 373 Accretion (9 ) Reclassification from non-accretable difference — Balance at September 30, 2018 $ 364 Non-accretable difference at September 30, 2018 $ 78 The accretable yield is recognized into interest income over the estimated life of the acquired vacation ownership notes receivable using the level yield method. The accretable yield may change in future periods due to changes in the anticipated remaining life of the acquired vacation ownership notes receivable, which may alter the amount of future interest income expected to be collected, and changes in expected future principal and interest cash collections which impacts the non-accretable difference. Our acquired vacation ownership notes receivable are remeasured at period end based on expected future cash flows which takes into consideration an estimated measure of anticipated defaults and early repayments. We consider historical Legacy-ILG vacation ownership notes receivable performance and the current economic environment in developing the expected future cash flows used in the re-measurement of our acquired vacation ownership notes receivable. The following table shows future contractual principal payments, as well as interest rates for our non-securitized and securitized acquired vacation ownership notes receivable at September 30, 2018 : Acquired Vacation Ownership Notes Receivable ($ in millions) Non-Securitized Securitized Total 2018, remaining $ 5 $ 15 $ 20 2019 10 60 70 2020 11 61 72 2021 12 62 74 2022 12 63 75 Thereafter 88 306 394 Balance at September 30, 2018 $ 138 $ 567 $ 705 Weighted average stated interest rate 13.4% 13.4% 13.4% Range of stated interest rates 3.5% to 17.9% 6.0% to 17.9% 3.5% to 17.9% Originated Vacation Ownership Notes Receivable Originated vacation ownership notes receivable represent vacation ownership notes receivable originated by Legacy-ILG subsequent to the Acquisition Date and all Legacy-MVW vacation ownership notes receivable. The following table shows future principal payments, net of reserves, as well as interest rates for our originated non-securitized and securitized originated vacation ownership notes receivable at September 30, 2018 : Originated Vacation Ownership Notes Receivable ($ in millions) Non-Securitized Securitized Total 2018, remaining $ 15 $ 25 $ 40 2019 42 99 141 2020 32 103 135 2021 26 107 133 2022 23 109 132 Thereafter 126 547 673 Balance at September 30, 2018 $ 264 $ 990 $ 1,254 Weighted average stated interest rate 11.5% 12.5% 12.3% Range of stated interest rates 0.0% to 18.0% 5.2% to 17.5% 0.0% to 18.0% For originated vacation ownership notes receivable, we record the difference between the vacation ownership note receivable and the variable consideration included in the transaction price for the sale of the related vacation ownership product as a reserve on our vacation ownership notes receivable. See Footnote 3 “Revenue” for further information. The following table summarizes the activity related to our originated vacation ownership notes receivable reserve: Originated Vacation Ownership Notes Receivable ($ in millions) Non-Securitized Securitized Total Balance at December 31, 2017 $ 58 $ 61 $ 119 Increase in vacation ownership notes receivable reserve 35 7 42 Securitizations (30 ) 30 — Clean-up call (1) 2 (2 ) — Write-offs (31 ) — (31 ) Defaulted vacation ownership notes receivable repurchase activity (2) 23 (23 ) — Balance at September 30, 2018 $ 57 $ 73 $ 130 _________________________ (1) Refers to our voluntary repurchase of previously securitized non-defaulted vacation ownership notes receivable to retire outstanding vacation ownership notes receivable securitizations. (2) Decrease in securitized vacation ownership notes receivable reserve and increase in non-securitized vacation ownership notes receivable reserve was attributable to the transfer of the reserve when we voluntarily repurchased defaulted securitized vacation ownership notes receivable. Credit Quality of Vacation Ownership Notes Receivable Legacy-MVW Vacation Ownership Notes Receivable Although we consider loans to owners to be past due if we do not receive payment within 30 days of the due date, we suspend accrual of interest only on those loans that are over 90 days past due. We consider loans over 150 days past due to be in default and fully reserve such amounts. We apply payments we receive for vacation ownership notes receivable on non-accrual status first to interest, then to principal and any remainder to fees. We resume accruing interest when vacation ownership notes receivable are less than 90 days past due. We do not accept payments for vacation ownership notes receivable during the foreclosure process unless the amount is sufficient to pay all past due principal, interest, fees and penalties owed and fully reinstate the note. We write off vacation ownership notes receivable against the reserve once we receive title to the vacation ownership products through the foreclosure or deed-in-lieu process or, in Asia Pacific or Europe, when revocation is complete. For both Legacy-MVW non-securitized and securitized vacation ownership notes receivable, we estimated average remaining default rates of 7.07 percent and 7.16 percent as of September 30, 2018 and December 31, 2017 , respectively. A 0.5 percentage point increase in the estimated default rate would have resulted in an increase in our vacation ownership notes receivable reserve of $7 million and $6 million as of September 30, 2018 and December 31, 2017 , respectively. The following table shows our recorded investment in non-accrual vacation ownership notes receivable, which are vacation ownership notes receivable that are 90 days or more past due: Legacy-MVW Vacation Ownership Notes Receivable ($ in millions) Non-Securitized Securitized Total Investment in vacation ownership notes receivable on non-accrual status at September 30, 2018 $ 40 $ 6 $ 46 Investment in vacation ownership notes receivable on non-accrual status at December 31, 2017 $ 39 $ 7 $ 46 Average investment in vacation ownership notes receivable on non-accrual status during the third quarter of 2018 $ 40 $ 6 $ 46 Average investment in vacation ownership notes receivable on non-accrual status during the third quarter of 2017 $ 40 $ 6 $ 46 Average investment in vacation ownership notes receivable on non-accrual status during the first three quarters of 2018 $ 39 $ 7 $ 46 Average investment in vacation ownership notes receivable on non-accrual status during the first three quarters of 2017 $ 42 $ 6 $ 48 The following table shows the aging of the recorded investment in principal, before reserves, in Legacy-MVW vacation ownership notes receivable as of September 30, 2018 : Legacy-MVW Vacation Ownership Notes Receivable ($ in millions) Non-Securitized Securitized Total 31 – 90 days past due $ 5 $ 18 $ 23 91 – 150 days past due 4 6 10 Greater than 150 days past due 36 — 36 Total past due 45 24 69 Current 238 1,039 1,277 Total vacation ownership notes receivable $ 283 $ 1,063 $ 1,346 The following table shows the aging of the recorded investment in principal, before reserves, in Legacy-MVW vacation ownership notes receivable as of December 31, 2017 : Legacy-MVW Vacation Ownership Notes Receivable ($ in millions) Non-Securitized Securitized Total 31 – 90 days past due $ 7 $ 19 $ 26 91 – 150 days past due 5 7 12 Greater than 150 days past due 34 — 34 Total past due 46 26 72 Current 313 849 1,162 Total vacation ownership notes receivable $ 359 $ 875 $ 1,234 Legacy-ILG Vacation Ownership Notes Receivable On an ongoing basis, we monitor credit quality of our Legacy-ILG vacation ownership notes receivable portfolio based on payment activity as follows: • Current — The vacation ownership note receivable is in good standing as payments and reporting are current per the terms contractually stipulated in the agreement. • Delinquent — We consider a vacation ownership note receivable to be delinquent based on the contractual terms of each individual financing agreement. • Non-performing — Our vacation ownership notes receivable are generally considered non-performing if interest or principal is more than 30 days past due. All non-performing vacation ownership notes receivable are placed on non-accrual status and we do not resume interest accrual until the vacation ownership notes receivable becomes contractually current. We apply payments we receive for vacation ownership notes receivable on non-performing status first to interest, then to principal, and any remainder to fees. We consider vacation ownership notes receivable to be in default upon reaching 120 days outstanding. We use the origination of the vacation ownership notes receivable by brand (Hyatt, Sheraton, Westin) and the FICO scores of the customer as the primary credit quality indicators for our Legacy-ILG vacation ownership notes receivable, as we believe there is a relationship between the default behavior of borrowers and the brand associated with the vacation ownership property they have acquired, supplemented by the FICO scores of the customers. At September 30, 2018, the weighted average FICO score within our consolidated Legacy-ILG vacation ownership notes receivable pools was 709 based upon the outstanding vacation ownership notes receivable balance at time of origination. The average estimated rate for all future defaults for our Legacy-ILG consolidated outstanding pool of vacation ownership notes receivable as of September 30, 2018 was 13.96 percent . The following table shows the Legacy-ILG acquired vacation ownership notes receivable by brand and FICO score as of September 30, 2018 : Acquired Vacation Ownership Notes Receivable ($ in millions) 700 + 600 - 699 < 600 No Score (1) Total Westin $ 174 $ 86 $ 7 $ 24 $ 291 Sheraton 156 133 22 58 369 Hyatt 22 13 1 1 37 Other — — — 8 8 $ 352 $ 232 $ 30 $ 91 $ 705 _________________________ (1) Vacation ownership notes receivable with no FICO score primarily relate to non-U.S. resident borrowers. The following table shows the Legacy-ILG originated vacation ownership notes receivable by brand and FICO score as of September 30, 2018 : Originated Vacation Ownership Notes Receivable ($ in millions) 700 + 600 - 699 < 600 No Score (1) Total Westin $ 13 $ 3 $ 1 $ 2 $ 19 Sheraton 7 5 2 3 17 Hyatt 1 1 — — 2 $ 21 $ 9 $ 3 $ 5 $ 38 _________________________ (1) Vacation ownership notes receivable with no FICO score primarily relate to non-U.S. resident borrowers. The following table shows the aging of the recorded investment in principal, before reserves, in Legacy-ILG originated vacation ownership notes receivable as of September 30, 2018 : Originated Vacation Ownership Notes Receivable Delinquent Defaulted (1) Total Delinquent & Defaulted ($ in millions) Receivables Current 30-59 Days 60-89 Days 90-119 Days >120 Days September 30, 2018 $ 38 $ 38 $ — $ — $ — $ — $ — _________________________ (1) |
FINANCIAL INSTRUMENTS
FINANCIAL INSTRUMENTS | 9 Months Ended |
Sep. 30, 2018 | |
Investments, All Other Investments [Abstract] | |
FINANCIAL INSTRUMENTS | FINANCIAL INSTRUMENTS The following table shows the carrying values and the estimated fair values of financial assets and liabilities that qualify as financial instruments, determined in accordance with the authoritative guidance for disclosures regarding the fair value of financial instruments. Considerable judgment is required in interpreting market data to develop estimates of fair value. The use of different market assumptions and/or estimation methodologies could have a material effect on the estimated fair value amounts. The table excludes Cash and cash equivalents, Restricted cash, Accounts receivable, Accounts payable, Advance deposits and Accrued liabilities, all of which had fair values approximating their carrying amounts due to the short maturities and liquidity of these instruments. At September 30, 2018 At December 31, 2017 ($ in millions) Carrying Amount Fair Value Carrying Amount Fair Value Originated vacation ownership notes receivable $ 1,254 $ 1,395 $ 1,115 $ 1,276 Other assets 51 51 14 14 Total financial assets $ 1,305 $ 1,446 $ 1,129 $ 1,290 Non-recourse debt associated with vacation ownership notes receivable securitizations, net $ (1,688 ) $ (1,683 ) $ (835 ) $ (836 ) Exchange Notes, net (88 ) (89 ) — — Senior Unsecured Notes, net (741 ) (772 ) — — IAC Notes (264 ) (264 ) — — Term Loan, net (887 ) (887 ) — — Convertible notes, net (198 ) (238 ) (192 ) (260 ) Non-interest bearing note payable, net (30 ) (30 ) (61 ) (61 ) Other debt, net (19 ) (19 ) — — Total financial liabilities $ (3,915 ) $ (3,982 ) $ (1,088 ) $ (1,157 ) Originated Vacation Ownership Notes Receivable At September 30, 2018 At December 31, 2017 ($ in millions) Carrying Amount Fair Value Carrying Amount Fair Value Originated vacation ownership notes receivable Securitized $ 990 $ 1,124 $ 814 $ 955 Eligible for securitization 57 64 142 162 Not eligible for securitization 207 207 159 159 Non-securitized 264 271 301 321 $ 1,254 $ 1,395 $ 1,115 $ 1,276 We estimate the fair value of our originated vacation ownership notes receivable that have been securitized using a discounted cash flow model. We believe this is comparable to the model that an independent third party would use in the current market. Our model uses default rates, prepayment rates, coupon rates and loan terms for our securitized vacation ownership notes receivable portfolio as key drivers of risk and relative value that, when applied in combination with pricing parameters, determine the fair value of the underlying vacation ownership notes receivable. Due to factors that impact the general marketability of our originated vacation ownership notes receivable that have not been securitized, as well as current market conditions, we bifurcate our non-securitized vacation ownership notes receivable at each balance sheet date into those eligible and not eligible for securitization using criteria applicable to current securitization transactions in the asset-backed securities (“ABS”) market. Generally, vacation ownership notes receivable are considered not eligible for securitization if any of the following attributes are present: (1) payments are greater than 30 days past due; (2) the first payment has not been received; or (3) the collateral is located in Asia or Europe. In some cases, eligibility may also be determined based on the credit score of the borrower, the remaining term of the loans and other similar factors that may reflect investor demand in a securitization transaction or the cost to effectively securitize the vacation ownership notes receivable. The table above shows the bifurcation of our originated vacation ownership notes receivable that have not been securitized into those eligible and not eligible for securitization based upon the aforementioned eligibility criteria. We estimate the fair value of the portion of our originated vacation ownership notes receivable that have not been securitized that we believe will ultimately be securitized in the same manner as originated vacation ownership notes receivable that have been securitized. We value the remaining originated vacation ownership notes receivable that have not been securitized at their carrying value, rather than using our pricing model. We believe that the carrying value of these particular vacation ownership notes receivable approximates fair value because the stated, or otherwise imputed, interest rates of these loans are consistent with current market rates and the reserve for these vacation ownership notes receivable appropriately accounts for risks in default rates, prepayment rates, discount rates and loan terms. We concluded that this fair value measurement should be categorized within Level 3. Other Assets Other assets include $28 million of company owned insurance policies (the “COLI policies”), acquired on the lives of certain participants in the Marriott Vacations Worldwide Deferred Compensation Plan, that are held in a rabbi trust. The carrying value of the COLI policies is equal to their cash surrender value (Level 2 inputs). In addition, we have investments in marketable securities of $8 million which are marked to market as trading securities using quoted market prices (Level 1 inputs). We have a $15 million note receivable related to a a convertible secured loan facility, due from a joint venture partner, for which fair value approximates carrying value as the terms and interest rates approximate market. See section entitled, Noncontrolling Interests , in Footnote 12 “Shareholders’ Equity” for additional information. Non-Recourse Debt Associated with Securitized Vacation Ownership Notes Receivable We generate cash flow estimates by modeling all bond tranches for our active vacation ownership notes receivable securitization transactions, with consideration for the collateral specific to each tranche. The key drivers in our analysis include default rates, prepayment rates, bond interest rates and other structural factors, which we use to estimate the projected cash flows. In order to estimate market credit spreads by rating, we obtain indicative credit spreads from investment banks that actively issue and facilitate the market for vacation ownership securities and determine an average credit spread by rating level of the different tranches. We then apply those estimated market spreads to swap rates in order to estimate an underlying discount rate for calculating the fair value of the active bonds payable. We concluded that this fair value measurement should be categorized within Level 3. Exchange Notes We estimate the fair value of our Exchange Notes (as defined in Footnote 11 “Debt”) using indicative quotes from securities dealers as of the last trading day for the quarter; however these notes have only a limited trading history and volume and as such this fair value estimate is not necessarily indicative of the value at which the Exchange Notes could be retired or transferred. We concluded that this fair value measurement should be categorized within Level 3. Senior Unsecured Notes We estimate the fair value of our Senior Unsecured Notes (as defined in Footnote 11 “Debt”) using quoted market prices as of the last trading day for the quarter; however these notes have only a limited trading history and volume as such this fair value estimate is not necessarily indicative of the value at which the Senior Unsecured Notes could be retired or transferred. We concluded that this fair value measurement should be categorized within Level 2. IAC Notes We estimate the fair value of our IAC Notes (as defined in Footnote 11 “Debt”) using indicative quotes from securities dealers as of the last trading day for the quarter; however these notes have only a limited trading volume and as such this fair value estimate is not necessarily indicative of the value at which the IAC Notes could be retired or transferred. We concluded that this fair value measurement should be categorized within Level 3. Term Loan We estimate the fair value of our Term Loan (as defined in Footnote 11 “Debt”) approximates its gross carrying value as the contractual interest rate is variable plus an applicable margin. In addition, the Term Loan was priced and closed within the third quarter of 2018. We concluded that this fair value measurement should be categorized within Level 3. Convertible Notes We estimate the fair value of our Convertible Notes (as defined in Footnote 11 “Debt”) using quoted market prices as of the last trading day for the quarter; however these notes have only a limited trading history and volume and as such this fair value estimate is not necessarily indicative of the value at which the Convertible Notes could be retired or transferred. We concluded that this fair value measurement should be categorized within Level 2. The difference between the carrying value and the fair value is primarily attributed to the underlying conversion feature, and the spread between the conversion price and the market value of the shares underlying the Convertible Notes. Non-Interest Bearing Note Payable |
EARNINGS PER SHARE
EARNINGS PER SHARE | 9 Months Ended |
Sep. 30, 2018 | |
Earnings Per Share [Abstract] | |
EARNINGS PER SHARE | EARNINGS PER SHARE Basic (loss) earnings per common share is calculated by dividing net (loss) income attributable to common shareholders by the weighted average number of shares of common stock outstanding during the reporting period. Treasury stock is excluded from the weighted average number of shares of common stock outstanding. Diluted (loss) earnings per common share is calculated to give effect to all potentially dilutive common shares that were outstanding during the reporting period, except in periods when there is a loss because the inclusion of the potential common shares would have an anti-dilutive effect. The dilutive effect of outstanding equity-based compensation awards is reflected in diluted (loss) earnings per common share by application of the treasury stock method using average market prices during the period. Our calculation of diluted (loss) earnings per share reflects our intent to settle conversions of the Convertible Notes through a combination settlement, which contemplates repayment in cash of the principal amount and repayment in shares of our common stock of any excess of the conversion value over the principal amount (the “conversion premium”). Therefore, we include only the shares that may be issued with respect to any conversion premium in total dilutive weighted average shares outstanding, which we calculate using the treasury stock method. As no conversion premium existed as of September 30, 2018 , there was no dilutive impact from the Convertible Notes for either the quarter or nine months then ended. The shares issuable on exercise of the Warrants (as defined in Footnote 11 “Debt”) sold in connection with the issuance of the Convertible Notes will not impact the total dilutive weighted average shares outstanding unless and until the price of our common stock exceeds the strike price, which was adjusted during the third quarter of 2018 to $176.40 , as described in Footnote 11 “Debt.” If and when the price of our common stock exceeds the strike price of the Warrants, we will include the dilutive effect of the additional shares that may be issued upon exercise of the Warrants in total dilutive weighted average shares outstanding, which we calculate using the treasury stock method. The Convertible Note Hedges (as defined in Footnote 11 “Debt”) purchased in connection with the issuance of the Convertible Notes are considered to be anti-dilutive and will not impact our calculation of diluted (loss) earnings per share. The table below illustrates the reconciliation of the (loss) earnings and number of shares used in our calculation of basic and diluted (loss) earnings per share. Three Months Ended Nine Months Ended (in millions, except per share amounts) September 30, 2018 September 30, 2017 (1) September 30, 2018 September 30, 2017 (1) Computation of Basic (Loss) Earnings Per Share Attributable to Common Shareholders Net (loss) income attributable to common shareholders $ (58 ) $ 40 $ (11 ) $ 116 Shares for basic (loss) earnings per share 32.8 27.1 28.8 27.2 Basic (loss) earnings per share $ (1.75 ) $ 1.49 $ (0.37 ) $ 4.27 Computation of Diluted (Loss) Earnings Per Share Attributable to Common Shareholders Net (loss) income attributable to common shareholders $ (58 ) $ 40 $ (11 ) $ 116 Shares for basic (loss) earnings per share 32.8 27.1 28.8 27.2 Effect of dilutive shares outstanding Employee stock options and SARs — 0.4 — 0.5 Restricted stock units — 0.2 — 0.2 Shares for diluted earnings per share 32.8 27.7 28.8 27.9 Diluted (loss) earnings per share $ (1.75 ) $ 1.45 $ (0.37 ) $ 4.18 _________________________ (1) The computations of diluted earnings per share exclude approximately 289,000 shares of common stock, the maximum number of shares issuable as of September 30, 2017 upon the vesting of certain performance-based awards, because the performance conditions required to be met for the shares subject to such awards to vest were not achieved by the end of the reporting period. In accordance with the applicable accounting guidance for calculating earnings per share, for the quarter and nine months ended September 30, 2017 |
INVENTORY
INVENTORY | 9 Months Ended |
Sep. 30, 2018 | |
Inventory Disclosure [Abstract] | |
INVENTORY | INVENTORY The following table shows the composition of our inventory balances: ($ in millions) At September 30, 2018 At December 31, 2017 Finished goods (1) $ 761 $ 391 Work-in-progress 55 2 Real estate inventory 816 393 Operating supplies and retail inventory 13 5 $ 829 $ 398 _________________________ (1) Represents completed unsold inventory that is either registered for sale as VOIs, or unregistered and available for sale in its current form. We value vacation ownership products at the lower of cost or fair market value less costs to sell, in accordance with applicable accounting guidance, and we record operating supplies at the lower of cost (using the first-in, first-out method) or net realizable value. In addition to the above, at September 30, 2018 , we had $45 million |
CONTINGENCIES AND COMMITMENTS
CONTINGENCIES AND COMMITMENTS | 9 Months Ended |
Sep. 30, 2018 | |
Commitments and Contingencies Disclosure [Abstract] | |
CONTINGENCIES AND COMMITMENTS | CONTINGENCIES AND COMMITMENTS Commitments and Letters of Credit As of September 30, 2018 , we had the following commitments outstanding: • We have various contracts for the use of information technology hardware and software that we use in the normal course of business. Our aggregate commitments under these contracts were $46 million , of which we expect $8 million , $20 million , $9 million , $4 million , $3 million and $2 million will be paid in the remainder of 2018, 2019, 2020, 2021, 2022 and thereafter, respectively. • We have commitments of $6 million to subsidize operating costs of vacation ownership property owners’ associations, which we expect to pay in the fourth quarter of 2018. • We have a commitment to purchase an operating property located in New York, New York for $170 million , of which $7 million is attributed to a related capital lease arrangement and recorded in Debt. We expect to acquire the units in the property in their current form, over time, and we are committed to make payments for these units of $108 million and $62 million in 2019 and 2020, respectively. We currently manage this property, which we have rebranded as Marriott Vacation Club Pulse, New York City. See Footnote 14 “Variable Interest Entities” for additional information on this transaction and our activities relating to the variable interest entity involved in this transaction. • We have a commitment to purchase 88 vacation ownership units located in Bali, Indonesia for use in our Vacation Ownership segment, contingent upon completion of construction to agreed-upon standards within specified timeframes. We expect to complete the acquisition in 2019 and to make payments with respect to these units when specific construction milestones are completed, as follows: $4 million in 2018 (which was paid subsequent to the end of the third quarter of 2018), $31 million in 2019 and $2 million in 2020. • We have a remaining commitment to purchase vacation ownership units located at our resort in Marco Island, Florida for $85 million , which we expect will be paid in 2018. See Footnote 2 “Acquisitions and Dispositions” and Footnote 14 “Variable Interest Entities” for additional information on this transaction and our activities relating to the variable interest entity involved in this transaction. • During the first quarter of 2018, we assigned a commitment to purchase an operating property located in San Francisco, California to a third-party developer in a capital efficient inventory arrangement. We expect to acquire the operating property in 2020 and to pay the purchase price of $164 million as follows: $100 million in 2020 and $64 million in 2021. See Footnote 14 “Variable Interest Entities” for additional information on this transaction and our activities relating to the variable interest entity involved in this transaction. Surety bonds issued as of September 30, 2018 totaled $74 million , the majority of which were requested by federal, state or local governments in connection with our operations. Additionally, as of September 30, 2018 , we had $6 million of letters of credit outstanding under our $600 million revolving credit facility (the “Revolving Corporate Credit Facility”) and $3 million of letters of credit outstanding in connection with our Legacy-ILG vacation ownership notes receivable securitizations. Guarantees At September 30, 2018 , our maximum exposure under guarantees was $45 million and primarily relates to Legacy-ILG’s rental management agreements, including those under which owners receive guaranteed dollar amounts, and accommodation leases supporting the Exchange & Third-Party Management segment’s management activities that are entered into on behalf of the property owners which either party generally may terminate upon 60 to 90 days prior written notice to the other party. Certain of our rental management agreements within our Exchange & Third-Party Management segment provide that owners receive specified percentages or guaranteed amounts of the rental revenue generated under its management. In these cases, the operating expenses for the rental operations are paid from the revenue generated by the rentals, the owners are then paid their contractual percentages or guaranteed amounts, and our vacation rental business either retains the balance (if any) as its fee or makes up the deficit. Although such deficits are reasonably possible in a few of these agreements, as of September 30, 2018 future amounts are not expected to be material either individually or in the aggregate. Loss Contingencies In April 2013, Krishna and Sherrie Narayan and other owners of 12 residential units (owners of two of which subsequently agreed to release their claims) at the resort formerly known as The Ritz-Carlton Club & Residences, Kapalua Bay (“Kapalua Bay”) filed an amended complaint in Circuit Court for Maui County, Hawaii against us, certain of our subsidiaries, Marriott International, certain of its subsidiaries, and the joint venture in which we have an equity investment that developed and marketed vacation ownership and residential products at Kapalua Bay (the “Joint Venture”). In the original complaint, the plaintiffs alleged that defendants mismanaged funds of the residential owners’ association (the “Kapalua Bay Association”), created a conflict of interest by permitting their employees to serve on the Kapalua Bay Association’s board, and failed to disclose documents to which the plaintiffs were allegedly entitled. The amended complaint alleged breach of fiduciary duty, violations of the Hawaii Unfair and Deceptive Trade Practices Act and the Hawaii condominium statute, intentional misrepresentation and concealment, unjust enrichment and civil conspiracy. The relief sought in the amended complaint included injunctive relief, repayment of all sums paid to us and our subsidiaries and Marriott International and its subsidiaries, compensatory and punitive damages, and treble damages under the Hawaii Unfair and Deceptive Trade Practices Act. In October 2018, the defendants reached agreements to settle the claims of the plaintiffs. During the third quarter of 2018 we recorded an accrual of $16 million in conjunction with the settlements. In June 2013, Earl C. and Patricia A. Charles, owners of a fractional interest at Kapalua Bay, together with owners of 38 other fractional interests (owners of two of which subsequently agreed to release their claims) at Kapalua Bay, filed an amended complaint in the Circuit Court of the Second Circuit for the State of Hawaii against us, certain of our subsidiaries, Marriott International, certain of its subsidiaries, the Joint Venture, and other entities that have equity investments in the Joint Venture. The plaintiffs allege that the defendants failed to disclose the financial condition of the Joint Venture and the commitment of the defendants to the Joint Venture, and that defendants’ actions constituted fraud and violated the Hawaii Unfair and Deceptive Trade Practices Act, the Hawaii Condominium Property Act and the Hawaii Time Sharing Plans statute. The relief sought includes compensatory and punitive damages, attorneys’ fees, pre-judgment interest, declaratory relief, rescission and treble damages under the Hawaii Unfair and Deceptive Trade Practices Act. The complaint was subsequently further amended to add owners of two additional fractional interests as plaintiffs. The Circuit Court set the case for trial beginning in January 2019. We dispute the material allegations in the amended complaint and continue to defend against the action vigorously. Given the inherent uncertainties of litigation, we cannot estimate a range of the potential liability, if any, at this time. In May 2015, we and certain of our subsidiaries were named as defendants in an action filed in the Superior Court of San Francisco County, California, by William and Sharon Petrick and certain other present and former owners of fractional interests at the RCC San Francisco. The plaintiffs alleged that the affiliation of the RCC San Francisco with our points-based Marriott Vacation Club Destinations (“MVCD”) program, certain alleged sales practices, and other acts we and the other defendants allegedly took caused an actionable decrease in the value of their fractional interests. The relief sought included, among other things, compensatory and punitive damages, rescission, and pre- and post-judgment interest. In July 2018, the parties reached an agreement in principle to settle the case and during the third quarter of 2018, we recorded an accrual of $11 million in connection with the settlement. In addition to various terms and conditions, the settlement in principle contemplates our repurchase of fractional interests owned by the plaintiffs. In March 2017, RCHFU, L.L.C. and other owners of 232 fractional interests at The Ritz-Carlton Club, Aspen Highlands (“RCC Aspen Highlands”) served an amended complaint in an action pending in the U.S. District Court for the District of Colorado against us, certain of our subsidiaries, and other third party defendants. The amended complaint alleges that the plaintiffs’ fractional interests were devalued by the affiliation of RCC Aspen Highlands and other Ritz-Carlton Clubs with our points-based MVCD program. The relief sought includes, among other things, unspecified damages, pre- and post-judgment interest, and attorneys’ fees. We filed a motion to dismiss the amended complaint, which the Court granted in part and denied in part in March 2018. In February 2018, plaintiffs filed a motion seeking to add a claim for punitive damages to their complaint, which the Court granted in May 2018. We dispute the plaintiffs’ material allegations and continue to defend against the action vigorously. Given the inherent uncertainties of litigation, we cannot estimate a range of the potential liability, if any, at this time. In May 2016, we, certain of our subsidiaries, and certain third parties were named as defendants in an action filed in the U.S. District Court for the Middle District of Florida by Anthony and Beth Lennen. The case is filed as a putative class action; the plaintiffs seek to represent a class consisting of themselves and all other purchasers of MVCD points, from inception of the MVCD program in June 2010 to the present, as well as all individuals who own or have owned weeks in any resorts for which weeks have been added to the MVCD program. Plaintiffs challenge the characterization of the beneficial interests in the MVCD trust that are sold to customers as real estate interests under Florida law. They also challenge the structure of the trust and associated operational aspects of the trust product. The relief sought includes, among other things, declaratory relief, an unwinding of the MVCD product, and punitive damages. In September 2016, we filed a motion to dismiss the complaint and a motion to stay the case pending referral of certain questions to Florida state regulators, and the Court granted the motion to dismiss and denied the motion to stay. The Court granted leave to plaintiffs to file an amended complaint, which plaintiffs filed in October 2017. In November 2017, we filed a motion to dismiss the amended complaint, which remains pending. In October 2018, plaintiffs filed a motion for class certification. We dispute the plaintiffs’ material allegations and continue to defend against the action vigorously. Given the early stages of the action and the inherent uncertainties of litigation, we cannot estimate a range of the potential liability, if any, at this time. In July 2018, a complaint challenging our acquisition of ILG was filed on behalf of alleged stockholders of ILG in the District Court for the District of Delaware, captioned Scarantino v. ILG, Inc., et al. The complaint named as defendants ILG, ILG’s directors, Ignite Holdco, Inc., Ignite Holdco Subsidiary, Inc., MVW, Volt Merger Sub, Inc. and Volt Merger Sub, LLC. The complaint alleged that (i) ILG and ILG’s directors issued a false and misleading registration statement in violation of Section 14(a) of the Exchange Act and Rule 14a-9 promulgated thereunder; and (ii) we and ILG’s directors, Volt Merger Sub, Inc. and Volt Merger Sub, LLC violated Section 20(a) of the Exchange Act by allegedly exercising control over ILG and ILG’s directors while they issued a false and misleading registration statement. Also in July 2018, two other complaints challenging the ILG transaction on similar grounds were filed, one on behalf of an alleged stockholder of ILG in the District Court for the Southern District of Florida, captioned Patricia Stephens v. ILG, Inc., et al., and another on behalf of alleged stockholders of ILG in the District Court for the District of Delaware, captioned Hohman v. ILG, Inc., et al. Each of the complaints sought an injunction preventing the defendants from consummating the transaction and attorneys’ fees and costs, as well as other remedies. In September 2018, the parties settled the cases for a nominal amount. In December 2016, individuals and entities who own or owned 107 fractional interests at the Fifth and Fifty-Fifth Residence Club located within The St. Regis, New York (the “Club”) filed an action against ILG, certain of its subsidiaries, Marriott International and certain of its subsidiaries including Starwood Hotels and Resorts Worldwide, LLC (“Starwood”). The case is filed as a mass action in the U.S. District Court for the Southern District of New York. Plaintiffs principally challenge the sale of less than all interests offered in the fractional offering plan, the amendment of the plan to include additional units, and the rental of unsold fractional interests by the plan’s sponsor, St. Regis Residence Club, New York, Inc., claiming that the alleged acts breached the relevant agreements and harmed the value of plaintiffs’ fractional interests. The relief sought includes, among other things, compensatory damages, rescission, disgorgement, attorneys’ fees, and pre- and post-judgment interest. In April 2017, defendants filed a motion to dismiss the amended complaint, which the Court granted in part and denied in part in September 2018. We dispute the material allegations and continue to defend against the action vigorously. Given the inherent uncertainties of litigation, we cannot estimate a range of the potential liability, if any, at this time. In February 2017, the owners’ association for the Club filed a separate suit against ILG and certain of its subsidiaries in the U.S. District Court for the Southern District of New York. In March 2017, before defendants were served with the initial complaint, plaintiff filed an amended complaint that added Marriott International and Starwood as defendants and added additional claims. Plaintiff filed a second amended complaint in July 2017. The complaint, as amended, asserts claims against the sponsor of the Club, the Club manager, St. Regis New York Management, Inc., and certain affiliated entities, as well as against Marriott International and Starwood, for alleged breach of fiduciary duties principally related to sale and rental practices, tortious interference with the management agreement, and alleged unjust enrichment, seeks certain declaratory relief in connection with the Starpoints conversion program and the exchange program at the Club, and asserts claims based on alleged anticompetitive conduct by the defendants in connection with plaintiff’s renewal of the Club management agreement. In addition to the declaratory relief sought, plaintiff seeks unspecified actual damages, punitive damages, and disgorgement of payments under the management and purchase agreements, as well as related agreements. In September 2017, defendants filed a motion to dismiss the second amended complaint, which the Court granted in part and denied in part in September 2018. We dispute the plaintiff’s material allegations and continue to defend against the action vigorously. Given the inherent uncertainties of litigation, we cannot estimate a range of the potential liability, if any, at this time. Other In addition to the above, in the second quarter of 2018 we recorded an accrual of $5 million in connection with an action brought by owners of fractional interests at The Ritz-Carlton, Lake Tahoe, and $1 million related to vacation ownership projects in Europe. During June 2018, we identified fraudulently induced electronic payment disbursements we made to third parties in an aggregate amount of $10 million resulting from unauthorized third-party access to our email system. Upon detection, we immediately notified law enforcement authorities and relevant financial institutions and commenced a forensic investigation. In each of the second and third quarters of 2018, we recovered $3 million , for a total recovery of $6 million as of September 30, 2018. We expect to recover a significant portion of the remaining $4 million through applicable insurance coverage. We reversed $3 million of the previously recorded loss in the Gains (losses) and other income (expense), net line of our Income Statement for the third quarter of 2018 and recorded a loss of $4 million in the Gains (losses) and other income (expense), net line of our Income Statement for the first three quarters of 2018. Any additional recoveries will be recorded in our results in the future. We have concluded that this event did not involve access to any of our other systems. No other misappropriation of assets was identified during our investigation. Insurance Recoveries During September 2017, the Westin St. John Resort Villas, a Legacy-ILG property, sustained damage as a result of Hurricane Irma. The resort has remained closed while rebuilding activities are in process. The reopening of the resort is currently targeted for January 2019. As of September 30, 2018, the property insurance claim receivable related to this event and other 2017 storms was $10 million |
SECURITIZED DEBT
SECURITIZED DEBT | 9 Months Ended |
Sep. 30, 2018 | |
Debt Disclosure [Abstract] | |
SECURITIZED DEBT | SECURITIZED DEBT The following table provides detail on our debt associated with vacation ownership notes receivable securitizations, net of unamortized debt issuance costs: ($ in millions) At September 30, 2018 At December 31, 2017 Vacation ownership notes receivable securitizations, gross (1) 1,034 845 Unamortized debt issuance costs (13 ) (10 ) 1,021 835 Legacy-ILG Vacation ownership notes receivable securitizations (2) 667 — $ 1,688 $ 835 _________________________ (1) Interest rates as of September 30, 2018 range from 2.2% to 6.3% , with a weighted average interest rate of 2.9% . (2) Interest rates as of September 30, 2018 range from 2.3% to 4.0% , with a weighted average interest rate of 2.9% . See Footnote 14 “Variable Interest Entities” for a discussion of the collateral for the non-recourse debt associated with the securitized vacation ownership notes receivable and our non-recourse warehouse credit facility (the “Warehouse Credit Facility”). On June 28, 2018 , we completed the securitization of a pool of $436 million of vacation ownership notes receivable. Approximately $327 million of the vacation ownership notes receivable were purchased on June 28, 2018 by the MVW Owner Trust 2018-1 (“2018-1 Trust”), and we received $317 million in gross cash proceeds. When the remaining $109 million were purchased by the 2018-1 Trust during the third quarter of 2018, the remaining $106 million of the proceeds, which had been held in restricted cash, were released. In connection with the securitization, investors purchased in a private placement $423 million in vacation ownership loan backed notes from the 2018-1 Trust. Three classes of vacation ownership loan backed notes were issued by the 2018-1 Trust: $316 million of Class A Notes, $65 million of Class B Notes and $42 million of Class C Notes. The Class A Notes have an interest rate of 3.45 percent, the Class B Notes have an interest rate of 3.60 percent and Class C Notes have an interest rate of 3.90 percent, for an overall weighted average interest rate of 3.52 percent. Legacy-ILG In August 2018, prior to the ILG Acquisition, Legacy-ILG completed a securitization of a pool of $293 million of vacation ownership notes receivable. Approximately $221 million of vacation ownership notes receivable were purchased prior to the ILG Acquisition by VSE 2018-A VOI Mortgage LLC (the “2018-A Trust”). We expect the remaining vacation ownership notes receivable to be purchased by the 2018-A Trust prior to December 31, 2018. As of September 30, 2018, the 2018-A Trust held $71 million of the proceeds, which will be released as the remaining vacation ownership notes receivable are purchased. Any funds not used to purchase vacation ownership notes receivable will be returned to the investors. On October 19, 2018, subsequent to the third quarter of 2018, the 2018-A Trust purchased $23 million of the remaining vacation ownership notes receivable and $23 million was released from restricted cash. In connection with the securitization, investors purchased in a private placement $287 million in vacation ownership loan backed notes from the 2018-A Trust. Three classes of vacation ownership loan backed notes were issued by the 2018-A Trust: $209 million of Class A Notes, $49 million of Class B Notes and $29 million of Class C Notes. The Class A Notes have an interest rate of 3.56 percent , the Class B Notes have an interest rate of 3.72 percent and Class C Notes have an interest rate of 4.02 percent , for an overall weighted average interest rate of 3.63 percent . Each of the securitized vacation ownership notes receivable transactions contains various triggers relating to the performance of the underlying vacation ownership notes receivable. If a pool of securitized vacation ownership notes receivable fails to perform within the pool’s established parameters (default or delinquency thresholds vary by transaction), transaction provisions effectively redirect the monthly excess spread we would otherwise receive from that pool (attributable to the interests we retained) to accelerate the principal payments to investors (taking into account the subordination of the different tranches to the extent there are multiple tranches) until the performance trigger is cured. During the third quarter of 2018, and as of September 30, 2018 , no securitized vacation ownership notes receivable pools were out of compliance with their respective established parameters. As of September 30, 2018 , we had 11 securitized vacation ownership notes receivable pools outstanding. As the contractual terms of the underlying securitized vacation ownership notes receivable determine the maturities of the non-recourse debt associated with them, actual maturities may occur earlier than shown below due to prepayments by the vacation ownership notes receivable obligors. The following table shows scheduled future principal payments for our vacation ownership notes receivable securitizations as of September 30, 2018 : Vacation Ownership Notes Receivable Securitizations (1) ($ in millions) Legacy-MVW Legacy-ILG Total Payments Year 2018, remaining $ 26 $ 43 $ 69 2019 102 161 263 2020 106 120 226 2021 110 93 203 2022 113 72 185 Thereafter 577 178 755 $ 1,034 $ 667 $ 1,701 _________________________ (1) The debt associated with our vacation ownership notes receivable securitizations is non-recourse to us. Warehouse Credit Facility The Warehouse Credit Facility, which has a borrowing capacity of $250 million , allows for the securitization of Legacy-MVW vacation ownership notes receivable on a non-recourse basis. During the first quarter of 2018, we amended certain agreements associated with this facility, and as a result, the revolving period was extended to March 13, 2020, certain unused facility fees were reduced and a reserve option was added to provide flexibility in complying with hedging requirements of the facility. Additionally, during the third quarter of 2018, we further amended certain agreements associated with this facility (the "Warehouse Amendment") in conjunction with the ILG Acquisition. The Warehouse Amendment requires us to comply with the financial covenants in the Revolving Corporate Credit Facility and eliminates the requirements to comply with the covenants contained in the Previous Revolving Corporate Credit Facility. The Warehouse Amendment did not modify the borrowing capacity or the term of the Warehouse Credit Facility. If the Warehouse Credit Facility is not renewed prior to termination, any amounts outstanding thereunder would become due and payable 13 months after termination, at which time all principal and interest collected with respect to the vacation ownership notes receivable held in the Warehouse Credit Facility would be redirected to the lenders to pay down the outstanding debt under the facility. The advance rate for vacation ownership notes receivable securitized using the Warehouse Credit Facility varies based on the characteristics of the securitized vacation ownership notes receivable. We also pay unused facility and other fees under the Warehouse Credit Facility. As of September 30, 2018 , there were no |
DEBT
DEBT | 9 Months Ended |
Sep. 30, 2018 | |
Debt Disclosure [Abstract] | |
DEBT | DEBT The following table provides detail on our debt balances, net of unamortized debt discount and issuance costs: ($ in millions) At September 30, 2018 At December 31, 2017 Senior Notes Exchange Notes (1) $ 89 $ — Unamortized debt issuance costs (1 ) — 88 — Senior Unsecured Notes (2) 750 — Unamortized debt issuance costs (9 ) — 741 — IAC Notes (3) 264 — Corporate Credit Facility Term Loan 900 — Unamortized debt discount and issuance costs (13 ) — 887 — Convertible notes, gross (4) 230 230 Unamortized debt discount and issuance costs (32 ) (38 ) 198 192 Non-Interest bearing note payable 31 64 Unamortized debt discount (5) (1 ) (3 ) 30 61 Capital leases 8 7 Other 19 — $ 2,235 $ 260 _________________________ (1) Interest rate of 5.625% , face amount of $88 million , maturing on April 15, 2023 . (2) Interest rate of 6.500% , face amount of $750 million , maturing on September 15, 2026 . (3) Interest rate of 5.625% , face amount of $262 million , maturing on April 15, 2023 . (4) The effective interest rate as of September 30, 2018 was 4.7% . (5) Debt discount based on imputed interest rate of 6.0% . The following table shows scheduled future principal payments for our debt as of September 30, 2018 : ($ in millions) Exchange Notes Senior Unsecured Notes IAC Notes Term Loan Convertible Notes Non-Interest Bearing Note Payable Capital Other Total Payments Year 2018, remaining $ — $ — $ — $ — $ — $ — $ — $ 1 $ 1 2019 — — — 9 — 31 8 1 49 2020 — — — 9 — — — 2 11 2021 — — — 9 — — — 2 11 2022 — — — 9 230 — — 2 241 Thereafter 89 750 264 864 — — — 11 1,978 $ 89 $ 750 $ 264 $ 900 $ 230 $ 31 $ 8 $ 19 $ 2,291 IAC Notes and Exchange Notes In connection with the ILG Acquisition, we assumed $350 million in aggregate principal amount of outstanding 5.625% Senior Unsecured Notes due 2023 (“IAC Notes”). The IAC Notes were issued under and are governed by the terms of an indenture, dated April 10, 2015, with HSBC Bank USA, National Association, as trustee. During the third quarter of 2018, Marriott Ownership Resorts Inc. (“MORI”), a wholly owned subsidiary of MVW, offered to exchange any and all of the IAC Notes for 5.625% Senior Unsecured Notes due 2023 (“Exchange Notes”) and cash (collectively the “Exchange Offer”). On September 4, 2018, we settled the Exchange Offer and issued the Exchange Notes pursuant to an indenture dated September 4, 2018 with HSBC Bank USA, National Association, as trustee. We exchanged $88 million of the IAC Notes for $88 million of Exchange Notes, plus approximately $1 million in cash. In addition, on September 14, 2018, we announced an offer to purchase any and all of the outstanding IAC Notes remaining after the settlement of the Exchange Offer for cash at a price equal to 101% of the principal amount of the IAC Notes validly tendered and not validly withdrawn, plus accrued and unpaid interest (the “Offer”). The Offer expired on October 15, 2018, at which time, $122 million in aggregate principal IAC Notes had been validly tendered. During the fourth quarter of 2018, the tendered IAC Notes were repurchased for $123 million using cash on hand, leaving $140 million in aggregate principal amounts of the IAC Notes remaining outstanding. We may redeem some or all of the outstanding IAC Notes prior to maturity under the terms provided in the indenture. Senior Unsecured Notes due 2026 In the third quarter of 2018, we issued $750 million aggregate principal amount of 6.500% senior unsecured notes due 2026 (“Senior Unsecured Notes”) under an indenture dated August 23, 2018 with The Bank of New York Mellon Trust, as trustee. We received net proceeds of $742 million from the offering, after deducting the underwriting discount and estimated expenses. We used these proceeds, together with the borrowings under the Term Loan (defined below) primarily to finance the cash component of the consideration paid to ILG shareholders, certain fees and expenses we incurred in connection with the ILG Acquisition and working capital. We may redeem some or all of the Senior Unsecured Notes prior to maturity under the terms provided in the indenture. Corporate Credit Facility During the third quarter of 2018, we extinguished our $250 million revolving credit facility (the “Previous Revolving Corporate Credit Facility”) and entered into a new credit facility (“Corporate Credit Facility”) including a $900 million term loan facility (“Term Loan”) which matures on August 31, 2025 and a Revolving Corporate Credit Facility with a borrowing capacity of $600 million , including a letter of credit sub-facility of $75 million , that terminates on August 31, 2023. All outstanding cash borrowings under our Previous Revolving Corporate Credit Facility were repaid in full. The Revolving Corporate Credit Facility will provide support for our business, including ongoing liquidity and letters of credit. The Term Loan bears interest at a floating rate plus an applicable margin that varies from 1.25 percent to 2.25 percent depending on the type of loan and our credit rating. Borrowings under the Revolving Corporate Credit Facility generally bear interest at a floating rate plus an applicable margin that varies from 0.50 percent to 2.75 percent depending on the type of loan and our credit rating. In addition, we pay a commitment fee on the unused availability under the Revolving Corporate Credit Facility at a rate that varies from 20 basis points per annum to 40 basis points per annum, also depending on our credit rating. No cash borrowings were outstanding as of September 30, 2018 under our Revolving Corporate Credit Facility. As of September 30, 2018 , we were in compliance with the applicable financial and operating covenants under the Corporate Credit Facility. ILG Revolving Credit Facility In connection with the ILG Acquisition, we acquired the outstanding balance on a revolving credit facility (the “ILG Revolving Credit Facility”). The ILG Revolving Credit Facility was extinguished and all amounts outstanding were repaid in full subsequent to the completion of the ILG Acquisition. Convertible Notes During the third quarter of 2017, we issued $230 million aggregate principal amount of 1.50% Convertible Senior Notes due 2022 (the “Convertible Notes”). The Convertible Notes were convertible at an initial rate of 6.7482 shares of common stock per $1,000 principal amount of Convertible Notes (equivalent to an initial conversion price of approximately $148.19 per share of our common stock). The conversion rate is subject to adjustment for certain events as described in the indenture governing the notes and was subject to adjustment during the third quarter of 2018 to 6.7589 shares of common stock per $1,000 principal amount of Convertible Notes (equivalent to a conversion price of approximately $147.95 per share of our common stock) when we declared a quarterly dividend of $0.40 per share, which was greater than the quarterly dividend at the time of the issuance of the Convertible Notes. Upon conversion, we will pay or deliver, as the case may be, cash, shares of our common stock or a combination of cash and shares of our common stock, at our election. It is our intent to settle conversions of the Convertible Notes through combination settlement, which contemplates repayment in cash of the principal amount and repayment in shares of our common stock of any excess of the conversion value over the principal amount. Holders may convert their Convertible Notes prior to June 15, 2022 only under certain circumstances. We may not redeem the Convertible Notes prior to their maturity date. If we undergo a fundamental change, as described in the indenture, subject to certain conditions, holders may require us to repurchase for cash all or any portion of their Convertible Notes, at a repurchase price equal to 100 percent of the principal amount of the Convertible Notes to be repurchased, plus accrued and unpaid interest to, but excluding, the repurchase date. If certain fundamental changes referred to in the indenture as make-whole fundamental changes occur, the conversion rate applicable to the Convertible Notes may increase. In accounting for the issuance of the Convertible Notes, we separated the Convertible Notes into liability and equity components and allocated $197 million to the liability component and $33 million to the equity component. The resulting debt discount is amortized as interest expense. We also incurred issuance costs of $7 million related to the Convertible Notes. As of September 30, 2018 , the remaining discount amortization period was 4.0 years . The following table shows the net carrying value of the Convertible Notes: ($ in millions) At September 30, 2018 At December 31, 2017 Liability component Principal amount $ 230 $ 230 Unamortized debt discount (27 ) (32 ) Unamortized debt issuance costs (5 ) (6 ) Net carrying amount of the liability component $ 198 $ 192 Carrying amount of equity component, net of issuance costs $ 33 $ 33 The following table shows interest expense information related to the Convertible Notes: Three Months Ended Nine Months Ended ($ in millions) September 30, 2018 September 30, 2017 September 30, 2018 September 30, 2017 Contractual interest expense $ 1 $ — $ 3 $ — Amortization of debt discount 1 — 4 — Amortization of debt issuance costs 1 — 1 — $ 3 $ — $ 8 $ — Convertible Note Hedges and Warrants In connection with the offering of the Convertible Notes, we entered into privately-negotiated convertible note hedge transactions with respect to our common stock (“Convertible Note Hedges”), covering a total of approximately 1.55 million shares of our common stock. The Convertible Note Hedges have a strike price that initially corresponds to the initial conversion price of the Convertible Notes, are subject to anti-dilution provisions substantially similar to those of the Convertible Notes, are exercisable by us upon any conversion under the Convertible Notes, and expire when the Convertible Notes mature. Concurrently with the entry into the Convertible Note Hedges, we separately entered into privately-negotiated warrant transactions (the “Warrants”), whereby we sold to the counterparties to the Convertible Note Hedges warrants to acquire, collectively, subject to anti-dilution adjustments, approximately 1.55 million shares of our common stock at an initial strike price of $176.68 per share, which was adjusted during the third quarter of 2018 to $176.40 per share when we declared a quarterly dividend of $0.40 per share, which was greater than the quarterly dividend at the time of the issuance of the Convertible Notes. Taken together, the Convertible Note Hedges and the Warrants are generally expected to reduce the potential dilution to our common stock (or, in the event the conversion of the Convertible Notes is settled in cash, to reduce our cash payment obligation) in the event that at the time of conversion our stock price exceeds the conversion price under the Convertible Notes and to effectively increase the overall initial conversion price from $148.19 (or a conversion premium of 30 percent ) to $176.68 per share (or a conversion premium of 55 percent ). The Warrants will expire in ratable portions on a series of expiration dates commencing on December 15, 2022. The Convertible Notes, the Convertible Note Hedges and the Warrants are transactions that are separate from each other. Holders of any such instrument have no rights with respect to the other instruments. As of September 30, 2018 , no Convertible Note Hedges or Warrants have been exercised. Non-Interest Bearing Note Payable During the second quarter of 2017, we issued an unsecured non-interest bearing note payable in connection with the acquisition of vacation ownership units located on the Big Island of Hawaii. Per the terms of the note payable, the first payment of $33 million was paid during the second quarter of 2018 and the remaining balance of $31 million is due in the second quarter of 2019. See Footnote 2 “Acquisitions and Dispositions” for additional information regarding this transaction. Restrictions |
SHAREHOLDERS' EQUITY
SHAREHOLDERS' EQUITY | 9 Months Ended |
Sep. 30, 2018 | |
Equity [Abstract] | |
SHAREHOLDERS' EQUITY | SHAREHOLDERS’ EQUITY Marriott Vacations Worldwide has 100,000,000 authorized shares of common stock, par value of $ 0.01 per share. At September 30, 2018 , there were 57,611,046 shares of Marriott Vacations Worldwide common stock issued, of which 47,205,452 shares were outstanding and 10,405,594 shares were held as treasury stock. At December 31, 2017 , there were 36,861,843 shares of Marriott Vacations Worldwide common stock issued, of which 26,461,296 shares were outstanding and 10,400,547 shares were held as treasury stock. Marriott Vacations Worldwide has 2,000,000 authorized shares of preferred stock, par value of $ 0.01 per share, none of which were issued or outstanding as of September 30, 2018 or December 31, 2017 . Share Repurchase Program The following table summarizes share repurchase activity under our current share repurchase program: ($ in millions, except per share amounts) Number of Shares Repurchased Cost of Shares Repurchased Average Price Paid per Share As of December 31, 2017 10,440,505 $ 697 $ 66.73 For the first three quarters of 2018 13,969 2 134.70 As of September 30, 2018 10,454,474 $ 699 $ 66.83 As of September 30, 2018 , our Board of Directors had authorized the repurchase of an aggregate of up to 11.9 million shares of our common stock under the share repurchase program since the initiation of the program in October 2013. Share repurchases may be made through open market purchases, privately negotiated transactions, block transactions, tender offers, accelerated share repurchase agreements or otherwise. The specific timing, amount and other terms of the repurchases will depend on market conditions, corporate and regulatory requirements and other factors. Acquired shares of our common stock are held as treasury shares carried at cost in our Financial Statements. In connection with the repurchase program, we are authorized to adopt one or more trading plans pursuant to the provisions of Rule 10b5-1 under the Securities Exchange Act of 1934, as amended. As of September 30, 2018 , 1.4 million shares remained available for repurchase under the authorization approved by our Board of Directors. The authorization for the share repurchase program may be suspended, terminated, increased or decreased by our Board of Directors at any time without prior notice. Dividends We declared cash dividends to holders of common stock during the first three quarters of 2018 as follows: Declaration Date Shareholder Record Date Distribution Date Dividend per Share February 16, 2018 March 1, 2018 March 15, 2018 $0.40 May 14, 2018 May 28, 2018 June 11, 2018 $0.40 September 6, 2018 September 20, 2018 October 4, 2018 $0.40 Any future dividend payments will be subject to Board approval, and there can be no assurance that we will pay dividends in the future. Noncontrolling Interests VRI Europe As part of the ILG Acquisition , we acquired a 75.5 percent interest in VRI Europe Limited (“VRI Europe”), a joint venture comprised of a European shared ownership resort management business, which is consolidated by MVW under the voting interest model. The corresponding noncontrolling interest in VRI Europe representing 24.5 percent of the business is held by CLC World Resorts and Hotels (“CLC”). As of September 30, 2018, this noncontrolling interest amounts to $18 million and is included on our Balance Sheet as a component of equity. In connection with the joint venture, Legacy-ILG and CLC entered into a loan agreement whereby Legacy-ILG made available to CLC a convertible secured loan facility of $15 million that matures in October 2019 with interest payable monthly. The outstanding loan is to be repaid in full at maturity either in cash or by means of a share option exercisable by MVW, at its sole discretion, which would allow for settlement of the loan in CLC’s shares of VRI Europe for contractually determined equivalent value. MVW has the right to exercise this share option at any time prior to maturity of the loan; however, the equivalent value for these shares would be measured at a 20 percent premium to its acquisition date value. We have determined the value of this embedded derivative is not material to warrant bifurcating it from the host instrument (loan) at this time. Property Owners’ Associations As part of the ILG Acquisition we established a noncontrolling interest in property owners’ associations that Legacy-ILG consolidates under the voting interest model, which represents the portion of the property owners’ associations related to individual or third-party VOI owners. As of September 30, 2018, this noncontrolling interest amounts to $11 million |
SHARE-BASED COMPENSATION
SHARE-BASED COMPENSATION | 9 Months Ended |
Sep. 30, 2018 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
SHARE-BASED COMPENSATION | SHARE-BASED COMPENSATION Legacy-MVW Plans We maintain the Marriott Vacations Worldwide Corporation Stock and Cash Incentive Plan (the “MVW Stock Plan”) for the benefit of our officers, directors and employees. Under the MVW Stock Plan, we award: (1) restricted stock units (“RSUs”) of our common stock, (2) SARs relating to our common stock and (3) stock options to purchase our common stock. A total of 6 million shares are authorized for issuance pursuant to grants under the MVW Stock Plan. As of September 30, 2018 , 1 million shares were available for grants under the MVW Stock Plan. The following table details our share-based compensation expense related to award grants to our officers, directors and employees: Three Months Ended Nine Months Ended ($ in millions) September 30, 2018 September 30, 2017 September 30, 2018 September 30, 2017 Service-based RSUs $ 3 $ 3 $ 9 $ 8 Performance-based RSUs 1 1 4 3 4 4 13 11 SARs 1 — 2 1 Stock options — — — — $ 5 $ 4 $ 15 $ 12 The following table details our deferred compensation costs related to unvested awards: ($ in millions) At September 30, 2018 At December 31, 2017 Service-based RSUs $ 17 $ 9 Performance-based RSUs 7 5 24 14 SARs 1 1 Stock options — — $ 25 $ 15 Restricted Stock Units We granted 141,931 service based RSUs, which are subject to time-based vesting conditions, with a weighted average grant-date fair value of $126.63 , to our employees and non-employee directors during the first three quarters of 2018. During the first three quarters of 2018, we also granted performance-based RSUs, which are subject to performance-based vesting conditions, to members of management. A maximum of 71,902 RSUs may be earned under the performance-based RSU awards granted during the first three quarters of 2018. Stock Appreciation Rights We granted 56,649 SARs, with a weighted average grant-date fair value of $44.75 and a weighted average exercise price of $143.38 , to members of management during the first three quarters of 2018. We use the Black-Scholes model to estimate the fair value of the SARs granted. The average expected life was calculated using the simplified method. The risk-free interest rate was calculated based on U.S. Treasury zero-coupon issues with a remaining term equal to the expected life assumed at the date of grant. The dividend yield assumption listed below is based on the expectation of future payouts. The following table outlines the assumptions used to estimate the fair value of grants during the first three quarters of 2018: Expected volatility 30.78% Dividend yield 1.11% Risk-free rate 2.68% Expected term (in years) 6.25 Legacy-ILG Plans As part of the ILG Acquisition , we assumed the Interval Leisure Group, Inc. 2013 Stock and Incentive Plan (the “ILG Stock Plan”) and equity based awards outstanding under the ILG Stock Plan. On the Acquisition Date , each outstanding ILG equity based award, whether vested or unvested, was converted into (1) an equity-based award with respect to MVW’s common stock on the same terms and conditions (including time-based vesting conditions, but excluding performance conditions, if applicable) applicable to the equity-based award under the ILG Stock Plan (“ILG RSUs”), and (2) a cash-based award on the same terms and conditions (including time-based vesting conditions, but excluding performance conditions, if applicable) applicable to the equity-based award under the ILG Stock Plan (“ILG Cash-Based Awards”). The number of shares of MVW common stock subject to each ILG RSU was determined by multiplying the number of shares of ILG common stock subject to the original ILG equity-based award (that each holder would have been eligible to receive based on deemed achievement of performance at target level immediately prior to the ILG Acquisition, if applicable) (“award number”) by 0.165 , rounded up or down to the nearest whole share, as applicable. The amount of the cash-based award was determined by multiplying $14.75 by the award number. ILG equity-based awards were converted into 0.4 million MVW RSUs and $39 million of MVW Cash-Based Awards. The obligation for these cash-settled awards is classified as a liability on our Balance Sheet. The converted awards (both MVW RSUs and MVW Cash-Based Awards) remain subject to graded vesting (i.e., portions of the award vest at different times during the vesting period) or to cliff vesting (i.e., all awards vest at the end of the vesting period), subject to a prorated adjustment for employees who are terminated under certain circumstances or who retire. The ILG RSUs had a weighted average fair value of $118.03 on the Acquisition Date . We recorded share-based compensation expense on these awards of $8 million for the 30 days ended September 30, 2018. Deferred compensation costs for unvested awards totaled $20 million as of September 30, 2018. As of September 30, 2018 , 1 million shares were available for grants under the ILG Stock Plan to Legacy-ILG employees. Deferred Compensation Plan Certain deferred share units (“DSUs”) of ILG common stock were outstanding on the Acquisition Date under the Interval Leisure Group, Inc. Deferred Compensation Plan for Non-Employee Directors. On the Acquisition Date, these DSUs were converted to equity-based awards with respect to MVW’s common stock and cash-based awards, resulting in 12,265 DSUs (“ILG DSUs”) and $1 million of cash-based awards. The ILG DSUs had a weighted average fair value of $114.31 on the Acquisition Date. The services associated with the ILG DSUs were completed as of the Acquisition Date, resulting in no deferred compensation costs. The total obligation for the ILG DSUs of $2 million |
VARIABLE INTEREST ENTITIES
VARIABLE INTEREST ENTITIES | 9 Months Ended |
Sep. 30, 2018 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
VARIABLE INTEREST ENTITIES | VARIABLE INTEREST ENTITIES Variable Interest Entities Related to Our Vacation Ownership Notes Receivable Securitizations We periodically securitize, without recourse, through bankruptcy remote special purpose entities, notes receivable originated in connection with the sale of vacation ownership products. These vacation ownership notes receivable securitizations provide funding for us and transfer the economic risks and substantially all the benefits of the consumer loans we originate to third parties. In a vacation ownership notes receivable securitization, various classes of debt securities issued by a special purpose entity are generally collateralized by a single tranche of transferred assets, which consist of vacation ownership notes receivable. With each vacation ownership notes receivable securitization, we may retain a portion of the securities, subordinated tranches, interest-only strips, subordinated interests in accrued interest and fees on the securitized vacation ownership notes receivable or, in some cases, overcollateralization and cash reserve accounts. We created these bankruptcy remote special purpose entities to serve as a mechanism for holding assets and related liabilities, and the entities have no equity investment at risk, making them variable interest entities. We continue to service the vacation ownership notes receivable, transfer all proceeds collected to these special purpose entities, and retain rights to receive benefits that are potentially significant to the entities. Accordingly, we concluded that we are the entities’ primary beneficiary and, therefore, consolidate them. There is no noncontrolling interest balance related to these entities and the creditors of these entities do not have general recourse to us. As part of the ILG Acquisition, we acquired the variable interests in the entities associated with ILG’s outstanding vacation ownership notes receivable securitization transactions. As these vacation ownership notes receivable securitizations are similar in nature to the Legacy-MVW vacation ownership notes receivable securitizations they have been aggregated for disclosure purposes. The following table shows consolidated assets, which are collateral for the obligations of these variable interest entities, and consolidated liabilities included on our Balance Sheet at September 30, 2018 : ($ in millions) Vacation Ownership Notes Receivable Securitizations Warehouse Credit Facility Total Consolidated Assets Vacation ownership notes receivable, net of reserves $ 1,557 $ — $ 1,557 Interest receivable 10 — 10 Restricted cash (1) 130 — 130 Total $ 1,697 $ — $ 1,697 Consolidated Liabilities Interest payable $ 2 $ — $ 2 Debt 1,701 — 1,701 Total $ 1,703 $ — $ 1,703 _________________________ (1) Includes $71 million of the proceeds from the securitization transaction completed prior to the ILG Acquisition, which will be released when the remaining vacation ownership notes receivable are purchased by the 2018-A Trust. Refer to Footnote 10 “Securitized Debt” for a discussion of the terms of this securitization and the purchase of additional vacation ownership notes receivable by the 2018-A Trust subsequent to the third quarter of 2018. The following table shows the interest income and expense recognized as a result of our involvement with these variable interest entities during the third quarter of 2018: ($ in millions) Vacation Ownership Notes Receivable Securitizations Warehouse Credit Facility Total Interest income $ 42 $ — $ 42 Interest expense to investors $ 10 $ 1 $ 11 Debt issuance cost amortization $ 1 $ — $ 1 The following table shows the interest income and expense recognized as a result of our involvement with these variable interest entities during the first three quarters of 2018: ($ in millions) Vacation Ownership Notes Receivable Securitizations Warehouse Credit Facility Total Interest income $ 95 $ — $ 95 Interest expense to investors $ 20 $ 1 $ 21 Debt issuance cost amortization $ 3 $ 1 $ 4 The following table shows cash flows between us and the vacation ownership notes receivable securitization variable interest entities: Nine Months Ended ($ in millions) September 30, 2018 September 30, 2017 Cash Inflows Net proceeds from vacation ownership notes receivable securitizations $ 419 $ 347 Principal receipts 227 171 Interest receipts 92 71 Reserve release 109 — Total 847 589 Cash Outflows Principal to investors (208 ) (159 ) Voluntary repurchases of defaulted vacation ownership notes receivable (34 ) (23 ) Voluntary clean-up call (22 ) — Interest to investors (19 ) (13 ) Funding of restricted cash (1) (117 ) (2 ) Total (400 ) (197 ) Net Cash Flows $ 447 $ 392 _________________________ (1) Includes $106 million of the proceeds from the securitization transaction completed during the second quarter of 2018, which were released when the remaining vacation ownership notes receivable were purchased by the 2018-1 Trust during the third quarter of 2018. The following table shows cash flows between us and the Warehouse Credit Facility variable interest entity: Nine Months Ended ($ in millions) September 30, 2018 September 30, 2017 Cash Inflows Proceeds from vacation ownership notes receivable securitizations $ — $ 50 Principal receipts — 2 Interest receipts — 2 Total — 54 Cash Outflows Principal to investors — (1 ) Repayment of Warehouse Credit Facility — (49 ) Interest to investors (1 ) (2 ) Total (1 ) (52 ) Net Cash Flows $ (1 ) $ 2 Under the terms of our vacation ownership notes receivable securitizations, we have the right to substitute loans for, or repurchase, defaulted loans at our option, subject to certain limitations. Our maximum exposure to loss relating to the special purpose entities that purchase, sell and own these vacation ownership notes receivable is the overcollateralization amount (the difference between the loan collateral balance and the balance on the outstanding vacation ownership notes receivable), plus cash reserves and any residual interest in future cash flows from collateral. Other Variable Interest Entities We have a commitment to purchase an operating property located in San Francisco, California. Refer to Footnote 9 “Contingencies and Commitments” for additional information on the commitment. We are required to purchase the operating property from the third party developer unless the developer has sold the property to another party. The operating property is held by a variable interest entity for which we are not the primary beneficiary as we cannot prevent the variable interest entity from selling the operating property at a higher price. Accordingly, we have not consolidated the variable interest entity. As of September 30, 2018 , our Balance Sheet reflected a note receivable of less than $1 million from this variable interest entity, included in the Accounts receivable line. We believe that our maximum exposure to loss as a result of our involvement with this variable interest entity is less than $1 million as of September 30, 2018 . We have a commitment to purchase an operating property located in New York, New York, that we currently manage as Marriott Vacation Club Pulse, New York City. Refer to Footnote 9 “Contingencies and Commitments” for additional information on the commitment. We are required to purchase the completed property from the third party developer unless the developer has sold the property to another party. The property is held by a variable interest entity for which we are not the primary beneficiary as we cannot prevent the variable interest entity from selling the property at a higher price. Accordingly, we have not consolidated the variable interest entity. As of September 30, 2018 , our Balance Sheet reflected $8 million in Property and equipment related to a capital lease and leasehold improvements and $7 million in Debt related to the capital lease liability for ancillary and operations space we lease from the variable interest entity. In addition, a note receivable of less than $1 million is included in the Accounts receivable line on the Balance Sheet as of September 30, 2018 . We believe that our maximum exposure to loss as a result of our involvement with this variable interest entity is $2 million as of September 30, 2018 . Pursuant to a commitment to repurchase an operating property located in Marco Island, Florida that was previously sold to a third-party developer, we acquired 36 completed vacation ownership units during the second quarter of 2017 and 20 completed vacation ownership units during the first quarter of 2018. See Footnote 2 “Acquisitions and Dispositions” for additional information on the transaction that occurred during the first quarter of 2018. We remain obligated to repurchase the remaining portion of the operating property. See Footnote 9 “Contingencies and Commitments” for additional information on our remaining commitment. The developer is a variable interest entity for which we are not the primary beneficiary as we do not control the variable interest entity’s development activities and cannot prevent the variable interest entity from selling the property at a higher price. Accordingly, we have not consolidated the variable interest entity. As of September 30, 2018 , our Balance Sheet reflected $3 million of Property and equipment, $3 million of Other assets that relate to prepaid and other deposits, and $7 million of Other liabilities that relate to the deferral of gain recognition on the previous sale transaction and the deferral of revenue for development management services for the remaining purchase commitment, both of which will reduce our basis in the asset if we repurchase the property. In addition, a note receivable and other receivables of less than $1 million are included in the Accounts receivable line on the Balance Sheet as of September 30, 2018 . We believe that our maximum exposure to loss as a result of our involvement with this variable interest entity is less than $1 million as of September 30, 2018 . Deferred Compensation Plan We consolidate the liabilities of the Marriott Vacations Worldwide Deferred Compensation Plan (the “Deferred Compensation Plan”) and the related assets, which consist of the COLI policies held in the rabbi trust. The rabbi trust is considered a variable interest entity. We are considered the primary beneficiary of the rabbi trust because we direct the activities of the trust and are the beneficiary of the trust. At September 30, 2018 , the value of the assets held in the rabbi trust was $28 million |
BUSINESS SEGMENTS
BUSINESS SEGMENTS | 9 Months Ended |
Sep. 30, 2018 | |
Segment Reporting [Abstract] | |
BUSINESS SEGMENTS | BUSINESS SEGMENTS We define our reportable segments based on the way in which the chief operating decision maker (“CODM”), currently our chief executive officer, manages the operations of the company for purposes of allocating resources and assessing performance. We operate in two reportable business segments: • Vacation Ownership , which as of September 30, 2018, had more than 100 resorts and nearly 650,000 owners and members of a diverse portfolio that includes seven vacation ownership brands licensed under exclusive, long-term relationships with Marriott International and Hyatt Hotels Corporation. We are the exclusive worldwide developer, marketer, seller and manager of vacation ownership and related products under the Marriott Vacation Club, Grand Residences by Marriott, Sheraton Vacation Club, Westin Vacation Club, and Hyatt Residence Club brands, as well as under Marriott Vacation Club Pulse, an extension to the Marriott Vacation Club brand. We are also the exclusive worldwide developer, marketer and seller of vacation ownership and related products under The Ritz-Carlton Destination Club brand, we have the non-exclusive right to develop, market and sell whole ownership residential products under The Ritz-Carlton Residences brand, and have a license to use the St. Regis brand for specified fractional ownership resorts. Our Vacation Ownership segment generates most of its revenues from four primary sources: selling vacation ownership products; managing our resorts; financing consumer purchases of vacation ownership products; and renting vacation ownership inventory. • Exchange & Third-Party Management , which, as of September 30, 2018, includes exchange networks and membership programs comprised of nearly 3,200 resorts in over 80 nations and approximately two million members, as well as management of more than 200 other resorts and lodging properties. We provide these services through a variety of brands including Interval International, Trading Places International, Vacation Resorts International, VRI Europe, Aqua-Aston and Great Destinations. Exchange & Third-Party Management revenue generally is fee-based and derived from membership, exchange and rental transactions, property and association management, and other related products and services. Our CODM evaluates the performance of our segments based primarily on the results of the segment without allocating corporate expenses or income taxes. We do not allocate corporate interest expense or indirect general and administrative expenses to our segments. We include interest income specific to segment activities within the appropriate segment. We allocate depreciation, other gains and losses, equity in earnings or losses from our joint ventures and noncontrolling interest to each of our segments as appropriate. Corporate and other represents that portion of our results that are not allocable to our segments, including those relating to property owners’ associations consolidated under the voting interest model, as our CODM does not use this information to make operating segment resource allocations. Our CODM monitors assets for the consolidated company and does not use assets by operating segment when assessing performance or making operating segment resource allocations. Prior year segment information has been reclassified to conform to the current reportable segment presentation. Revenues Three Months Ended Nine Months Ended ($ in millions) September 30, 2018 September 30, 2017 September 30, 2018 September 30, 2017 Vacation Ownership $ 709 $ 530 $ 1,875 $ 1,621 Exchange & Third-Party Management 40 — 40 — Total segment revenues 749 530 1,915 1,621 Corporate and other 1 — 1 — $ 750 $ 530 $ 1,916 $ 1,621 Net (Loss) Income Three Months Ended Nine Months Ended ($ in millions) September 30, 2018 September 30, 2017 September 30, 2018 September 30, 2017 Vacation Ownership $ 96 $ 92 $ 259 $ 268 Exchange & Third-Party Management 12 — 12 — Total segment financial results 108 92 271 268 Corporate and other (176 ) (29 ) (275 ) (90 ) Provision for income taxes 10 (23 ) (7 ) (62 ) $ (58 ) $ 40 $ (11 ) $ 116 We conduct business globally, and our operations outside the United States represented approximately 13 |
ADOPTION IMPACT OF NEW REVENUE
ADOPTION IMPACT OF NEW REVENUE STANDARD | 9 Months Ended |
Sep. 30, 2018 | |
Revenue from Contract with Customer [Abstract] | |
ADOPTION IMPACT OF NEW REVENUE STANDARD | REVENUE We account for revenue in accordance with ASC 606, “ Revenue from Contracts with Customers ,” which we adopted on January 1, 2018, using the retrospective method. See Footnote 1 “Summary of Significant Accounting Policies” for additional information and Footnote 16 “Adoption Impact of New Revenue Standard” for further discussion of the adoption and the impact on our previously reported historical results. Sources of Revenue by Segment Three Months Ended September 30, 2018 ($ in millions) Vacation Ownership Exchange & Third-Party Management Corporate and Other Total Sale of vacation ownership products $ 252 $ — $ — $ 252 Ancillary revenues 42 — — 42 Management fee revenues 28 8 (1 ) 35 Other services revenues 21 20 8 49 Management and exchange 91 28 7 126 Rental 86 4 — 90 Cost reimbursements 232 8 (6 ) 234 Revenue from contracts with customers 661 40 1 702 Financing 48 — — 48 Total Revenues $ 709 $ 40 $ 1 $ 750 Three Months Ended September 30, 2017 ($ in millions) Vacation Ownership Exchange & Third-Party Management Corporate and Other Total Sale of vacation ownership products $ 183 $ — $ — $ 183 Ancillary revenues 31 — — 31 Management fee revenues 23 — — 23 Other services revenues 16 — — 16 Management and exchange 70 — — 70 Rental 66 — — 66 Cost reimbursements 177 — — 177 Revenue from contracts with customers 496 — — 496 Financing 34 — — 34 Total Revenues $ 530 $ — $ — $ 530 Nine Months Ended September 30, 2018 ($ in millions) Vacation Ownership Exchange & Third-Party Management Corporate and Other Total Sale of vacation ownership products $ 632 $ — $ — $ 632 Ancillary revenues 106 — — 106 Management fee revenues 78 8 (1 ) 85 Other services revenues 55 20 8 83 Management and exchange 239 28 7 274 Rental 235 4 — 239 Cost reimbursements 650 8 (6 ) 652 Revenue from contracts with customers 1,756 40 1 1,797 Financing 119 — — 119 Total Revenues $ 1,875 $ 40 $ 1 $ 1,916 Nine Months Ended September 30, 2017 ($ in millions) Vacation Ownership Exchange & Third-Party Management Corporate and Other Total Sale of vacation ownership products $ 549 $ — $ — $ 549 Ancillary revenues 91 — — 91 Management fee revenues 67 — — 67 Other services revenues 51 — — 51 Management and exchange 209 — — 209 Rental 203 — — 203 Cost reimbursements 561 — — 561 Revenue from contracts with customers 1,522 — — 1,522 Financing 99 — — 99 Total Revenues $ 1,621 $ — $ — $ 1,621 Timing of Revenue from Contracts with Customers by Segment Three Months Ended September 30, 2018 ($ in millions) Vacation Ownership Exchange & Third-Party Management Corporate and Other Total Services transferred over time $ 367 $ 23 $ 1 $ 391 Goods or services transferred at a point in time 294 17 — 311 Revenue from contracts with customers $ 661 $ 40 $ 1 $ 702 Three Months Ended September 30, 2017 ($ in millions) Vacation Ownership Exchange & Third-Party Management Corporate and Other Total Services transferred over time $ 278 $ — $ — $ 278 Goods or services transferred at a point in time 218 — — 218 Revenue from contracts with customers $ 496 $ — $ — $ 496 Nine Months Ended September 30, 2018 ($ in millions) Vacation Ownership Exchange & Third-Party Management Corporate and Other Total Services transferred over time $ 1,010 $ 23 $ 1 $ 1,034 Goods or services transferred at a point in time 746 17 — 763 Revenue from contracts with customers $ 1,756 $ 40 $ 1 $ 1,797 Nine Months Ended September 30, 2017 ($ in millions) Vacation Ownership Exchange & Third-Party Management Corporate and Other Total Services transferred over time $ 867 $ — $ — $ 867 Goods or services transferred at a point in time 655 — — 655 Revenue from contracts with customers $ 1,522 $ — $ — $ 1,522 Sale of Vacation Ownership Products We market and sell vacation ownership products in our Vacation Ownership segment. Vacation ownership products include deeded vacation ownership products, deeded beneficial interests, rights to use real estate and other interests in trusts that solely hold real estate (collectively “vacation ownership products” or VOIs). Vacation ownership products may be sold for cash or we may provide financing. In connection with the sale of vacation ownership products, we provide sales incentives to certain purchasers and, in certain cases, membership in a brand affiliated club. Non-cash incentives typically include Marriott Rewards points, Hyatt’s customer loyalty program points (“World of Hyatt” points) or an alternative sales incentive that we refer to as “plus points.” Plus points are redeemable for stays at our resorts or for use in an exclusive selection of travel packages provided by affiliate tour operators (the “Explorer Collection”), generally up to two years from the date of issuance. Typically, sales incentives are only awarded if the sale is closed. Upon execution of a legal sales agreement, we typically receive an upfront deposit from our customer with the remainder of the purchase price for the vacation ownership product to either be collected at closing (“cash contract”) or financed by the customer through our financing programs (“financed contract”). Refer to “ Financing Revenues ” below for further information regarding financing terms. Customer deposits received for contracts are recorded as Advance deposits on our Balance Sheets until the point in time at which control of the vacation ownership product has transferred to the customer. Our assessment of collectibility of the transaction price for sales of vacation ownership products is aligned with our credit granting policies for financed contracts. In determining the consideration to which we expect to be entitled for financed contracts, we include estimated variable consideration in the transaction price to the extent it is probable that a significant reversal of cumulative revenue recognized will not occur when the uncertainty associated with the variable consideration is resolved. Our estimates of variable consideration and determination of whether to include estimated amounts in the transaction price are based largely on the customer class and the results of our static pool analyses, which rely on historical payment data by customer class. Variable consideration which has not been included within the transaction price is presented as a reserve on vacation ownership notes receivable. Revisions to estimates of variable consideration from the sale of vacation ownership products impact the reserve on vacation ownership notes receivable and can increase or decrease revenue. Revenues were reduced during the third quarter and first three quarters of 2018 by $1 million and $3 million , respectively, due to changes in our estimate of variable consideration for performance obligations that were satisfied in prior periods. In addition, we account for cash incentives provided to customers as a reduction of the transaction price. Refer to “ Arrangements with Multiple Performance Obligations ” below for a description of our methods of allocating transaction price to each performance obligation. We evaluated our business practices, and the underlying risks and rewards associated with vacation ownership products and the respective timing that such risks and rewards are transferred to the customer in determining the point in time at which control of the vacation ownership product is transferred to the customer. Based upon the different terms of the contracts with the customer and business practices, we transfer control of the vacation ownership product at different times for Legacy-MVW and Legacy-ILG. We recognize revenue on the sale of Legacy-MVW vacation ownership products at closing. We recognize revenue on the sale of Legacy-ILG vacation ownership products upon expiration of the rescission period and completion of construction. Revenue for non-cash incentives, such as plus points, is recorded as Deferred revenue on our Balance Sheets at closing and is recognized as rental revenue upon transfer of control to the customer, which typically occurs upon delivery of the incentive, or at the point in time when the incentive is redeemed. For non-cash incentives provided by third parties (i.e. Marriott Rewards points, World of Hyatt points or third-party Explorer Collection offerings), we evaluated whether we control the underlying good or service prior to delivery to the customer. We concluded that we are an agent for those non-cash incentives which we do not control prior to delivery and as such record the related revenue net of the related cost upon recognition. Management and Exchange Revenues and Cost Reimbursements Revenues Ancillary Revenues Ancillary revenues consist of goods and services that are sold or provided by us at food and beverage outlets, golf courses and other retail and service outlets located at our resorts. Payments for such goods and services are generally received at the point of sale in the form of cash or credit card charges. For goods and services sold, we evaluate whether we control the underlying goods or services prior to delivery to the customer. For transactions where we do not control the goods or services prior to delivery, the related revenue is recorded net of the related cost upon recognition. We recognize ancillary revenue at the point in time when goods have been provided and/or services have been rendered. Management Fee Revenues and Cost Reimbursements Revenues We provide day-to-day-management services, including housekeeping services, operation of reservation systems, maintenance and certain accounting and administrative services for property owners’ associations, condominium owners and hotels. We generate revenue from fees we earn for managing vacation ownership resorts, condominiums and hotels. In our Vacation Ownership segment, these fees are earned regardless of usage or occupancy and are typically based on either a percentage of the budgeted costs to operate the resorts or a fixed fee arrangement (“VO management fee revenues”). In our Exchange & Third-Party Management segment, we earn base management fees which are typically either (i) fixed amounts, (ii) amounts based on a percentage of adjusted gross lodging revenue, or (iii) various revenue sharing agreements based on stated formulas (“Base management fee revenues”) and incentive management fees, which are generally a percentage of either operating profits or improvement in operating profits (“Incentive management fees”). In addition, we receive reimbursement of costs incurred on behalf of our customers, which consist of actual expenses with no added margin (“cost reimbursements”). Vacation Ownership segment cost reimbursements revenues exclude amounts that we have paid to the property owners’ associations related to maintenance fees for unsold vacation ownership products, as we have concluded that such payments are consideration payable to a customer. Management fees are collected over time or upfront depending upon the specific management contract. Cost reimbursements are received over time and considered variable consideration. We have determined that a significant financing component does not exist as a substantial amount of the consideration promised by the customer is paid when the associated variable consideration is determined. We evaluated the nature of the management services provided and concluded that the management services constitute a series of distinct services to be accounted for as a single performance obligation transferred over time. We use an input method, the number of days that management services are provided, to recognize VO management fee revenues and Base management fee revenues, which is consistent with the pattern of transfer to the customers who receive and consume the benefits as services are provided each day. We recognize incentive management fees as earned throughout the incentive period based on actual results, which is subject to estimation of the transaction price. Any consideration we receive in advance of services being rendered is recorded as Deferred revenue on our Balance Sheets and is recognized ratably across the service period to which it relates. We recognize variable consideration for Cost reimbursements revenues when the reimbursable costs are incurred. Other Services Revenues Other services revenues includes revenues from membership fees, club dues and additional fees for services we provide to customers. Membership fees and club dues are received in advance of providing access to the exchange services, are recorded as Deferred revenue on our Balance Sheets and are earned regardless of whether exchange services are provided. Generally, Interval International memberships are cancelable and refundable on a pro-rata basis, with the exception of the Interval Network’s Platinum tier which is non-refundable. Transaction-based fees are typically collected at a point in time. We have determined that exchange services constitute a stand-ready obligation for us to provide unlimited access to exchange services over a defined period of time, when and if a customer (or customer of a customer) requests. We have determined that customers benefit from the stand-ready obligation evenly throughout the period in which the customer has access to exchange services and as such, recognize membership fees and club dues on a straight-line basis over the related period of time. Transaction-based fees are recognized as revenue at the point in time at which the relevant goods or services are transferred to the customer. For transaction-based fees, we evaluate whether we control the underlying goods or services prior to delivery to the customer. Transaction-based fees from exchanges and other transactions in our Exchange & Third-Party Management segment are generally recognized when confirmation of the transaction is provided and services have been rendered. For transactions where we do not control the goods or services prior to delivery, the related revenue is recorded net of the related cost upon recognition. Financing Revenues We offer consumer financing as an option to qualifying customers purchasing vacation ownership products, which is collateralized by the underlying vacation ownership products. We recognize interest income on an accrual basis. The contractual terms of the financing agreements require that the contractual level of annual principal payments be sufficient to amortize the loan over a customary period for the vacation ownership product being financed, which is generally ten years. Generally, payments commence under the financing contracts 30 to 60 days after closing. We record the difference between the vacation ownership note receivable and the variable consideration included in the transaction price for the sale of the related vacation ownership product as a reserve on our vacation ownership notes receivable. We earn interest income from the financing arrangements on the principal balance outstanding over the life of the arrangement and record that interest income in Financing revenues on our Income Statements. Financing revenues include transaction-based fees we charge to owners and other third parties for services. We recognize fee revenues when services have been rendered. Rental Revenues We generate revenue from rentals of inventory that we hold for sale as interests in our vacation ownership programs, inventory that we control because our owners have elected alternative usage options permitted under our vacation ownership programs and rentals of owned-hotel properties. In addition, in our Exchange & Third-Party Management segment, we offer vacation rental opportunities to members of the Interval Network and certain other membership programs from seasonal oversupply or underutilized space, as well as resort accommodations. We receive payments for rentals primarily through credit card charges. We recognize rental revenues when occupancy has occurred, which is consistent with the period in which the customer benefits from such service. We recognize rental revenue from the utilization of plus points issued in connection with the sale of vacation ownership products as described in “ Sale of Vacation Ownership Products ” above. We also generate revenues from vacation packages sold to our customers. The packages have an expiration period of six to twenty-four months, and payments for such packages are non-refundable and generally paid by the customer in advance. Payments received in advance are recorded as Advance deposits on our Balance Sheets, until the revenue is recognized, when occupancy has occurred. For rental revenues associated with vacation ownership products which we own and which are registered and held for sale, to the extent that the proceeds are less than costs, revenues are reported net in accordance with ASC Topic 978, “ Real Estate – Time-Sharing Activities .” Arrangements with Multiple Performance Obligations Our contracts with customers may include multiple performance obligations. For such arrangements, we allocate revenue to each performance obligation based on its relative standalone selling price. In cases where the standalone selling price is not readily available, we generally determine the standalone selling prices utilizing the adjusted market approach, using prices from similar contracts, our historical pricing on similar contracts, our internal marketing and selling data and other internal and external inputs we deem to be appropriate. Significant judgment is required in determining the standalone selling price under the adjusted market approach. Deferred Revenue in a Business Combination When we acquire a business which records deferred revenue on its historical financial statements, we are required to re-measure that deferred revenue as of the acquisition date pursuant to the rules related to accounting for business combinations. The post-acquisition impact of that re-measurement results in recognizing revenue which solely comprises the cost of the associated legal performance obligation we assumed as part of the acquisition, plus a normal profit margin. This accounting treatment typically results in lower amounts of revenue recognized in a reporting period following an acquisition than would have been recognized on a historical basis. Receivables, Contract Assets & Contract Liabilities As discussed above, the payment terms and conditions in our customer contracts vary. In some cases, customers prepay for their goods and services; in other cases, after appropriate credit evaluations, payment is due in arrears. When the timing of our delivery of goods and services is different from the timing of the payments made by customers, we recognize either a contract asset (performance precedes contractual due date) or a contract liability (customer payment precedes performance or when we have a right to consideration that is unconditional before the transfer of goods or services to a customer). Receivables are recorded when the right to consideration becomes unconditional. Contract liabilities are recognized as revenue as (or when) we perform under the contract. The following table shows the composition of our receivables and contract liabilities. We had no contract assets at either September 30, 2018 or December 31, 2017 . ($ in millions) At September 30, 2018 At December 31, 2017 Receivables Accounts receivable $ 46 $ 73 Vacation ownership notes receivable, net 1,959 1,115 $ 2,005 $ 1,188 Contract Liabilities Advance deposits $ 124 $ 84 Deferred revenue 325 69 $ 449 $ 153 Revenue recognized in the third quarter and first three quarters of 2018 that was included in our contract liabilities balance at December 31, 2017 was $13 million and $107 million , respectively. Remaining Performance Obligations Our remaining performance obligations represent the expected transaction price allocated to our contracts that we expect to recognize as revenue in future periods when we perform under the contracts. At September 30, 2018 , 90 percent of this amount is expected to be recognized as revenue over the next two As discussed in Footnote 1 “Summary of Significant Accounting Policies,” the FASB issued ASU 2014-09 in 2014, which, as amended, created ASC 606. The core principle of ASC 606 is that an entity shall recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The standard also contains significant new disclosure requirements regarding the nature, amount, timing and uncertainty of revenue and cash flows arising from contracts with customers. We adopted ASC 606 effective January 1, 2018, on a retrospective basis and restated our previously reported historical results as shown in the tables below. Upon adoption of the new Revenue Standard, recognition of revenue from the sale of vacation ownership products that is deemed collectible is now deferred from the point in time at which the statutory rescission period expires to closing, when control of the vacation ownership product is transferred to the customer. In addition, we aligned our assessment of collectibility of the transaction price for sales of vacation ownership products with our credit granting policies. We elected the practical expedient to expense all marketing and sales costs as they are incurred. Our consolidated cost reimbursements revenues and cost reimbursements expenses increased significantly, as all costs reimbursed to us by property owners’ associations are now reported on a gross basis upon adoption of the new Revenue Standard. In conjunction with the adoption of the new Revenue Standard we reclassified certain revenues and expenses. As part of the adoption of the new Revenue Standard, we elected the following practical expedients and accounting policies: • We expense all marketing and sales costs that we incur to sell vacation ownership products when incurred. • In determining the transaction price for contracts from customers, we exclude all taxes assessed by a governmental authority that are both imposed on and concurrent with a specific revenue-product transaction and collected by the entity from a customer (e.g., sales tax). • We do not disclose the amount of the transaction price allocated to the remaining performance obligations as of December 31, 2017 or provide an explanation of when we expect to recognize that amount as revenue. The following tables present the impact of the adoption of the new Revenue Standard on our previously reported historical results for the periods presented. Income Statement Impact - Third Quarter of 2017 Three Months Ended September 30, 2017 ($ in millions) As Reported ASC 606 Adjustments Conforming Reclassifications (1) As Adjusted REVENUES Sale of vacation ownership products $ 180 $ 3 $ — $ 183 Resort management and other services 77 (7 ) (70 ) — Management and exchange — — 70 70 Rental 81 (15 ) — 66 Financing 34 — — 34 Cost reimbursements 114 63 — 177 TOTAL REVENUES 486 44 — 530 EXPENSES Cost of vacation ownership products 43 3 — 46 Marketing and sales 100 (4 ) (2 ) 94 Resort management and other services 45 (5 ) (40 ) — Management and exchange — — 38 38 Rental 71 (13 ) (1 ) 57 Financing 5 — 6 11 General and administrative 27 — (1 ) 26 Depreciation and amortization — — 6 6 Litigation settlement 2 — — 2 Consumer financing interest 6 — (6 ) — Royalty fee 15 — — 15 Cost reimbursements 114 63 — 177 TOTAL EXPENSES 428 44 — 472 Gains and other income, net 7 — — 7 Interest expense (2 ) — — (2 ) INCOME BEFORE INCOME TAXES AND NONCONTROLLING INTERESTS 63 — — 63 Provision for income taxes (22 ) (1 ) — (23 ) NET INCOME 41 (1 ) — 40 Net income attributable to noncontrolling interests — — — — NET INCOME ATTRIBUTABLE TO COMMON SHAREHOLDERS $ 41 $ (1 ) $ — $ 40 Earnings per share - Basic $ 1.50 $ (0.01 ) $ — $ 1.49 Earnings per share - Diluted $ 1.47 $ (0.02 ) $ — $ 1.45 _________________________ (1) We have reclassified certain prior year amounts to conform to our current quarter presentation. See Footnote 1 “Summary of Significant Accounting Policies” for a description of the reclassifications. Income Statement Impact - First Three Quarters of 2017 Nine Months Ended September 30, 2017 ($ in millions) As Reported ASC 606 Adjustments Conforming Reclassifications (1) As Adjusted REVENUES Sale of vacation ownership products $ 544 $ 5 $ — $ 549 Resort management and other services 229 (20 ) (209 ) — Management and exchange — — 209 209 Rental 250 (47 ) — 203 Financing 99 — — 99 Cost reimbursements 348 213 — 561 TOTAL REVENUES 1,470 151 — 1,621 EXPENSES Cost of vacation ownership products 132 9 — 141 Marketing and sales 305 (13 ) (5 ) 287 Resort management and other services 130 (13 ) (117 ) — Management and exchange — — 111 111 Rental 212 (42 ) (2 ) 168 Financing 12 — 18 30 General and administrative 84 — (3 ) 81 Depreciation and amortization — — 16 16 Litigation settlement 2 — — 2 Consumer financing interest 18 — (18 ) — Royalty fee 47 — — 47 Cost reimbursements 348 213 — 561 TOTAL EXPENSES 1,290 154 — 1,444 Gains and other income, net 7 — — 7 Interest expense (5 ) — — (5 ) ILG acquisition costs — — (1 ) (1 ) Other (1 ) — 1 — INCOME BEFORE INCOME TAXES AND NONCONTROLLING INTERESTS 181 (3 ) — 178 Provision for income taxes (62 ) — — (62 ) NET INCOME 119 (3 ) — 116 Net income attributable to noncontrolling interests — — — — NET INCOME ATTRIBUTABLE TO COMMON SHAREHOLDERS $ 119 $ (3 ) $ — $ 116 Earnings per share - Basic $ 4.36 $ (0.09 ) $ — $ 4.27 Earnings per share - Diluted $ 4.26 $ (0.08 ) $ — $ 4.18 _________________________ (1) We have reclassified certain prior year amounts to conform to our current quarter presentation. See Footnote 1 “Summary of Significant Accounting Policies” for a description of the reclassifications. Balance Sheet Impact As of December 31, 2017 ($ in millions) As Reported ASC 606 Adjustments Conforming Reclassifications (1) As Adjusted ASSETS Cash and cash equivalents $ 409 $ — $ — $ 409 Restricted cash 82 — — 82 Accounts receivable, net 154 (62 ) — 92 Vacation ownership notes receivable, net 1,120 (5 ) — 1,115 Inventory 716 12 (330 ) 398 Property and equipment 253 — 330 583 Other 172 (6 ) — 166 TOTAL ASSETS $ 2,906 $ (61 ) $ — $ 2,845 LIABILITIES AND EQUITY Accounts payable $ 145 $ — $ — $ 145 Advance deposits 63 21 — 84 Accrued liabilities 168 (48 ) — 120 Deferred revenue 98 (29 ) — 69 Payroll and benefits liability 112 — — 112 Deferred compensation liability 75 — — 75 Securitized debt — — 835 835 Debt, net 1,095 — (835 ) 260 Other 14 — — 14 Deferred taxes 91 (1 ) — 90 TOTAL LIABILITIES 1,861 (57 ) — 1,804 Preferred stock — — — — Common stock — — — — Treasury stock (694 ) — — (694 ) Additional paid-in capital 1,189 — — 1,189 Accumulated other comprehensive income 17 — — 17 Retained earnings 533 (4 ) — 529 TOTAL EQUITY 1,045 (4 ) — 1,041 TOTAL LIABILITIES AND EQUITY $ 2,906 $ (61 ) $ — $ 2,845 ___________________ (1) We have reclassified certain prior year amounts to conform to our current quarter presentation. See Footnote 1 “Summary of Significant Accounting Policies” for a description of the reclassifications. Cash Flow Impact - Operating Activities Nine Months Ended September 30, 2017 ($ in millions) As Reported Adjustments As Adjusted OPERATING ACTIVITIES Net income $ 119 $ (3 ) $ 116 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation 16 — 16 Amortization of debt discount and issuance costs 6 — 6 Vacation ownership notes receivable reserve 38 2 40 Share-based compensation 12 — 12 Deferred income taxes 21 2 23 Net change in assets and liabilities: Accounts receivable 25 (2 ) 23 Vacation ownership notes receivable originations (346 ) 1 (345 ) Vacation ownership notes receivable collections 204 — 204 Inventory 28 (2 ) 26 Purchase of vacation ownership units for future transfer to inventory (34 ) — (34 ) Other assets 23 11 34 Accounts payable, advance deposits and accrued liabilities (65 ) (13 ) (78 ) Deferred revenue 7 3 10 Payroll and benefit liabilities 1 — 1 Deferred compensation liability 10 — 10 Other liabilities (1 ) 1 — Other, net 7 — 7 Net cash provided by operating activities $ 71 $ — $ 71 |
SUPPLEMENTAL GUARANTOR INFORMAT
SUPPLEMENTAL GUARANTOR INFORMATION | 9 Months Ended |
Sep. 30, 2018 | |
Guarantees and Product Warranties [Abstract] | |
SUPPLEMENTAL GUARANTOR INFORMATION | SUPPLEMENTAL GUARANTOR INFORMATION The IAC Notes are guaranteed by Marriott Vacations Worldwide Corporation, ILG and certain other subsidiaries for which 100% of the voting securities are owned directly or indirectly by ILG (collectively, the “Guarantor Subsidiaries”). These guarantees are full and unconditional and joint and several. The guarantees of the Guarantor Subsidiaries are subject to release in limited circumstances only upon the occurrence of certain customary conditions. The indenture governing the IAC Notes contains covenants that, among other things, limit the ability of Interval Acquisition Corp. (the “Issuer”) and the Guarantor Subsidiaries to pay dividends to us or make distributions, loans or advances to us. The following tables present consolidating financial information as of September 30, 2018 and for the thirty days ended September 30, 2018 for MVW and ILG on a stand-alone basis, the Issuer on a stand-alone basis, the combined Guarantor Subsidiaries of MVW (collectively, the “Guarantor Subsidiaries”), the combined non-guarantor subsidiaries of MVW (collectively, the “Non-Guarantor Subsidiaries”) and MVW on a consolidated basis. Condensed Consolidating Balance Sheet As of September 30, 2018 ($ in millions) MVW ILG Interval Acquisition Corp. Guarantor Subsidiaries Non-Guarantor Subsidiaries Total Eliminations MVW Consolidated Cash and cash equivalents $ — $ 2 $ 2 $ 37 $ 400 $ — $ 441 Restricted cash — — — 52 313 — 365 Accounts receivable, net 21 — 21 63 159 (28 ) 236 Vacation ownership notes receivable, net — — — 162 1,797 — 1,959 Inventory — — — 465 364 — 829 Property and equipment — 1 — 282 669 — 952 Goodwill (1) 2,747 — — — — — 2,747 Intangibles, net — — — 1,178 38 — 1,216 Investments in subsidiaries 1,251 (75 ) 1,290 1,100 — (3,566 ) — Other 28 — 2 137 139 (38 ) 268 Total assets $ 4,047 $ (72 ) $ 1,315 $ 3,476 $ 3,879 $ (3,632 ) $ 9,013 Accounts payable $ 33 $ — $ — $ 46 $ 94 $ 8 $ 181 Advance deposits — — — 29 95 — 124 Accrued liabilities 11 4 — 154 235 (34 ) 370 Deferred revenue — — — 121 204 — 325 Payroll and benefits liability 16 — — 75 103 — 194 Deferred compensation liability — — — 8 86 — 94 Securitized debt, net — — — — 1,688 — 1,688 Debt, net 198 — 264 — 1,773 — 2,235 Other 2 — — 1 12 — 15 Deferred taxes 74 84 87 25 (6 ) 2 266 Intercompany liabilities (receivables) / equity 2,667 (931 ) 1,039 1,729 (3,397 ) (1,107 ) — MVW shareholders' equity 1,046 771 (75 ) 1,290 2,958 (2,494 ) 3,496 Noncontrolling interests — — — (2 ) 34 (7 ) 25 Total liabilities and equity $ 4,047 $ (72 ) $ 1,315 $ 3,476 $ 3,879 $ (3,632 ) $ 9,013 _________________________ (1) We have not completed the assignment of goodwill to our reporting units as of the date of this report. Condensed Consolidating Statement of Income Thirty Days Ended September 30, 2018 ($ in millions) MVW ILG Interval Acquisition Corp. Guarantor Subsidiaries Non-Guarantor Subsidiaries Total Eliminations MVW Consolidated Revenues $ — $ — $ — $ 114 $ 356 $ — $ 470 Expenses (3 ) (4 ) — (138 ) (345 ) — (490 ) Interest expense — — (1 ) — (4 ) — (5 ) ILG acquisition-related costs (42 ) — — — (30 ) — (72 ) Income tax benefit 14 1 — 7 7 — 29 Net loss (31 ) (3 ) (1 ) (17 ) (16 ) — (68 ) Net loss attributable to noncontrolling interests — — — — — — — Net loss attributable to common shareholders $ (31 ) $ (3 ) $ (1 ) $ (17 ) $ (16 ) $ — $ (68 ) Condensed Consolidating Statement of Cash Flows Thirty Days Ended September 30, 2018 ($ in millions) MVW ILG Interval Acquisition Corp. Guarantor Subsidiaries Non-Guarantor Subsidiaries MVW Consolidated Net cash and restricted cash provided by (used in) operating activities $ 60 $ — $ (2 ) $ (32 ) $ 41 $ 67 Net cash and restricted cash used in investing activities (13 ) — — (2 ) (1,408 ) (1,423 ) Net cash and restricted cash (used in) provided by financing activities (47 ) — 2 (4 ) 1,720 1,671 Cash, cash equivalents and restricted cash, beginning of period — 2 2 126 361 491 Cash, cash equivalents and restricted cash, end of period $ — $ 2 $ 2 $ 88 $ 714 $ 806 |
SUMMARY OF SIGNIFICANT ACCOUN_2
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 9 Months Ended |
Sep. 30, 2018 | |
Accounting Policies [Abstract] | |
Our Business | The Interim Consolidated Financial Statements present the results of operations, financial position and cash flows of Marriott Vacations Worldwide Corporation (“we,” “us,” “Marriott Vacations Worldwide,” “MVW” or the “Company,” which includes our consolidated subsidiaries except where the context of the reference is to a single corporate entity). In order to make this report easier to read, we refer throughout to (i) our Interim Consolidated Financial Statements as our “Financial Statements,” (ii) our Interim Consolidated Statements of Income as our “Income Statements,” (iii) our Interim Consolidated Balance Sheets as our “Balance Sheets” and (iv) our Interim Consolidated Statements of Cash Flows as our “Cash Flows.” In addition, references throughout to numbered “Footnotes” refer to the numbered Notes in these Notes to Interim Consolidated Financial Statements, unless otherwise noted. We use certain other terms that are defined within these Financial Statements. The Financial Statements presented herein and discussed below include 100 percent of the assets, liabilities, revenues, expenses and cash flows of Marriott Vacations Worldwide, all entities in which Marriott Vacations Worldwide has a controlling voting interest (“subsidiaries”), and those variable interest entities for which Marriott Vacations Worldwide is the primary beneficiary in accordance with consolidation accounting guidance. References in these Financial Statements to net income attributable to common shareholders and MVW shareholders’ equity do not include noncontrolling interests, which represent the outside ownership of our consolidated non-wholly owned entities and are reported separately. Intercompany accounts and transactions between consolidated companies have been eliminated in consolidation. These Financial Statements reflect our financial position, results of operations and cash flows as prepared in conformity with United States Generally Accepted Accounting Principles (“GAAP”). In our opinion, our Financial Statements reflect all normal and recurring adjustments necessary to present fairly our financial position, the results of our operations and cash flows for the periods presented. Interim results may not be indicative of fiscal year performance because of, among other reasons, the ILG Acquisition (defined below), seasonal and short-term variations. These Financial Statements have not been audited. We have condensed or omitted certain information and footnote disclosures normally included in financial statements presented in accordance with GAAP. Although we believe our footnote disclosures are adequate to make the information presented not misleading, the Financial Statements in this report should be read in conjunction with the consolidated financial statements and notes thereto recast for the adoption of Accounting Standards Update (“ASU”) 2014-09 “ Revenue from Contracts with Customers (Topic 606), ” as amended (“ASU 2014-09”) included in our Current Report on Form 8-K, filed with the U.S. Securities and Exchange Commission on June 5, 2018. |
Acquisition of ILG and Business Combinations | Acquisition of ILG On September 1, 2018 , we completed the previously announced acquisition of ILG, LLC, formerly known as ILG, Inc. (“ILG”) through a series of transactions, after which ILG became our indirect wholly-owned subsidiary (the “ ILG Acquisition ”). The Financial Statements in this report include ILG’s results of operations for the 30 days ended September 30, 2018 and reflect the financial position of our combined company at September 30, 2018. We refer to our business associated with brands that existed prior to the ILG Acquisition as “Legacy-MVW” and to ILG’s business and brands that we acquired as “Legacy-ILG.” See Footnote 2 “Acquisitions and Dispositions” for more information on the ILG Acquisition . Business Combinations |
Goodwill, Intangibles and Long-Lived Assets | Goodwill We test goodwill for potential impairment at least annually, or more frequently if an event or other circumstance indicates that we may not be able to recover the carrying amount of the net assets of the reporting unit. In evaluating goodwill for impairment, we may assess qualitative factors to determine whether it is more likely than not (that is, a likelihood of more than 50 percent) that the fair value of a reporting unit is less than its carrying amount. If we bypass the qualitative assessment, or if we conclude that it is more likely than not that the fair value of a reporting unit is less than its carrying value, then we perform a quantitative impairment test by comparing the fair value of a reporting unit with its carrying amount. Intangibles and Long-Lived Assets |
Restricted Cash | Restricted Cash Restricted cash primarily consists of cash restricted for use by consolidated property owners’ associations which is designated for resort operations and other specific uses, such as reserves, cash held in a reserve account related to vacation ownership notes receivable securitizations, cash collected for maintenance fees to be remitted to property owners’ associations, and deposits received and held in escrow, primarily associated with the sale of vacation ownership products. |
Reclassifications | Reclassifications We have reclassified the following prior year amounts to conform to the current year presentation: • Reclassified Resort management and other services revenue to Management and exchange revenue; • Reclassified Resort management and other services expense to Management and exchange expense; • Consolidated Consumer financing interest expense into Financing expense; • Reclassified depreciation expense from Marketing and sales expense, Management and exchange expense, Rental expense, and General and administrative expense to Depreciation and amortization expense; • Reclassified costs related to the ILG Acquisition from Other expense to ILG acquisition-related costs; • Reclassified $330 million of land and infrastructure from Inventory to Property and equipment at December 31, 2017; and • Reclassified $835 million |
New Accounting Standards | New Accounting Standards Accounting Standards Update 2018-05 – “ Income Taxes (Topic 740): Amendments to SEC Paragraphs Pursuant to SEC Staff Accounting Bulletin No. 118 ” (“ASU 2018-05”) In March 2018, the Financial Accounting Standards Board (“FASB”) issued ASU 2018-05, which updates the income tax accounting in GAAP to reflect the interpretive guidance in Staff Accounting Bulletin (“SAB”) 118 (“SAB 118”), that was issued by the staff of the Securities and Exchange Commission in December 2017 in order to address the application of GAAP in situations where a registrant does not have all the necessary information available, prepared, or analyzed (including computations) in reasonable detail to complete the accounting for certain income tax effects of the Tax Cuts and Jobs Act (“the “Tax Act”). SAB 118 provides for a provisional one year measurement period for registrants to finalize their accounting for certain income tax effects related to the Tax Act. ASU 2018-05 was effective upon issuance. We expect to finalize our provisional amounts related to the Tax Act by the fourth quarter of 2018. See Footnote 4 “Income Taxes” for additional information. Accounting Standards Update 2016-01 – “ Financial Instruments – Overall (Subtopic 825-10) ” (“ASU 2016-01”) In January 2016, the FASB issued ASU 2016-01, which updates certain aspects of recognition, measurement, presentation and disclosure of financial instruments. For public business entities, the amendments in ASU 2016-01 will be effective for fiscal years beginning after December 15, 2017, including interim periods within those fiscal years. The adoption of ASU 2016-01 in the first quarter of 2018 did not have a material impact on our financial statements or disclosures. Accounting Standards Update 2016-16 – “ Income Taxes (Topic 740): Intra-Entity Transfers of Assets Other Than Inventory ” (“ASU 2016-16”) In October 2016, the FASB issued ASU 2016-16, which changes the timing of when certain intercompany transactions are recognized within the provision for income taxes. This update is effective for public companies for annual periods beginning after December 15, 2017, and for annual periods and interim periods thereafter, with early adoption permitted. The adoption of ASU 2016-16 in the first quarter of 2018 did not have a material impact on our financial statements or disclosures. Accounting Standards Update 2014-09 – “ Revenue from Contracts with Customers (Topic 606) ” (“ASU 2014-09”), as Amended In May 2014, the FASB issued ASU 2014-09, which, as amended, created Accounting Standards Codification (“ASC”) Topic 606, “ Revenue from Contracts with Customers ” (“ASC 606”), and supersedes the revenue recognition requirements in ASC Topic 605, “ Revenue Recognition, |
Future Adoption of Accounting Standards | Future Adoption of Accounting Standards Accounting Standards Update 2017-12 – “ Derivatives and Hedging (Topic 815): Targeted Improvements to Accounting for Hedging Activities ” (“ASU 2017-12”) In August 2017, the FASB issued ASU 2017-12, which amends and simplifies existing guidance in order to allow companies to better portray the economic effects of risk management activities in the financial statements and enhance the transparency and understandability of the results of hedging activities. ASU 2017-12 eliminates the requirement to separately measure and report hedge ineffectiveness and generally requires the entire change in the fair value of a hedging instrument to be presented in the same income statement line as the hedged item. The guidance also eases certain documentation and assessment requirements. This update is effective for public companies for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years, with early adoption permitted. We expect to adopt ASU 2017-12 commencing in fiscal year 2019 and are continuing to evaluate the impact that adoption of this update will have on our financial statements and disclosures. Accounting Standards Update 2016-13 – “ Financial Instruments – Credit Losses (Topic 326), Measurement of Credit Losses on Financial Instruments ” (“ASU 2016-13”) In June 2016, the FASB issued ASU 2016-13, which replaces the incurred loss impairment methodology in current GAAP with a methodology that reflects expected credit losses. The update is intended to provide financial statement users with more decision-useful information about the expected credit losses on financial instruments and other commitments to extend credit held by a reporting entity at each reporting date. This update is effective for fiscal years beginning after December 15, 2019, including interim periods within those fiscal years, with early adoption permitted for fiscal years beginning after December 15, 2018. We expect to adopt ASU 2016-13 commencing in fiscal year 2019 and are continuing to evaluate the impact that adoption of this update will have on our financial statements and disclosures. Accounting Standards Update 2016-02 – “ Leases (Topic 842) ” (“ASU 2016-02”) In February 2016, the FASB issued ASU 2016-02 to increase transparency and comparability of information regarding an entity’s leasing activities by providing additional information to users of financial statements. ASU 2016-02 requires lessees to recognize most leases on their balance sheet by recording a liability for its lease obligation and an asset for its right to use the underlying asset as of the lease commencement date and recognizing expenses on the income statement in a similar manner to the current guidance in Accounting Standards Codification 840, Leases (“ASC 840”). Lessor accounting will remain largely unchanged, other than certain targeted improvements intended to align lessor accounting with the lessee accounting model and with the updated revenue recognition guidance. Upon adoption of ASU 2016-02, as amended, leases will be classified as either finance or operating, with classification affecting the geography of expense recognition in the income statement. Additionally, enhanced quantitative and qualitative disclosures regarding leases are required. ASU 2016-02 is effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years, with early adoption permitted. As permitted by the amended guidance, we intend to elect to retain the original lease classification and historical accounting for existing or expired contracts of lessees and lessors so that we will not be required to reassess whether such contracts contain leases, the lease classification, or the initial direct costs. Additionally, with respect to our real estate leases, we intend to elect an accounting policy by class of underlying asset to combine lease and non-lease components. We do not intend to utilize the practical expedient which allows the use of hindsight by lessees and lessors in determining the lease term and in assessing impairment of its right-of-use assets. We plan to adopt ASU 2016-02, as amended, using the transition method which allows the application of the standard at the adoption date, January 1, 2019, and will recognize a cumulative-effect adjustment to the opening balance of retained earnings in the period of adoption. We are continuing our implementation efforts and evaluating the impact that adoption of ASU 2016-02, as amended, will have on our financial statements and disclosures, including for example, any potential changes to and investments in policies, processes, systems and internal controls over financial reporting that may be required to comply with the new guidance related to identifying and measuring right-of-use assets and lease liabilities. |
ACQUISITIONS AND DISPOSITIONS (
ACQUISITIONS AND DISPOSITIONS (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Business Combinations [Abstract] | |
Consideration Transfered | The following table presents the fair value of each class of consideration transferred at the Acquisition Date. (in millions, except per share amounts) Equivalent shares of Marriott Vacations Worldwide common stock issued in exchange for ILG outstanding shares 20.5 Marriott Vacations Worldwide common stock price as of Acquisition Date $ 119.00 Fair value of Marriott Vacations Worldwide common stock issued in exchange for ILG outstanding shares 2,441 Cash consideration to ILG shareholders, net of cash acquired of $154 million 1,680 Fair value of ILG equity-based awards attributed to pre-combination service 64 Total consideration transferred, net of cash acquired 4,185 Noncontrolling interests 25 $ 4,210 |
Schedule of Recognized Identified Assets Acquired and Liabilities Assumed | The following table presents our preliminary estimates of the fair values of the assets that we acquired and the liabilities that we assumed in connection with the business combination. ($ in millions) Vacation ownership notes receivable $ 736 Inventory 494 Property and equipment 384 Intangible assets 1,223 Other assets 581 Deferred revenue (217 ) Deferred taxes (174 ) Debt (392 ) Securitized debt from VIEs (696 ) Other liabilities (476 ) Net assets acquired 1,463 Goodwill (1) 2,747 $ 4,210 _________________________ (1) Goodwill is calculated as total consideration transferred, net of cash acquired, less identified net assets acquired |
Finite-Lived and Indefinite-Lived Intangible Assets Acquired as Part of Business Combination | The following table presents our preliminary estimates of the fair values of ILG’s identified intangible assets and their related estimated useful lives. Estimated Fair Value ($ in millions) Estimated Useful Life (in years) Member relationships $ 754 10 to 15 Management contracts 354 15 to 25 Management contracts (1) 33 indefinite Trade names and trademarks 82 indefinite $ 1,223 _________________________ (1) |
Schedule of Future Minimum, Operating | The following table presents the future minimum lease obligations that we assumed in the ILG Acquisition and for which we are the primary obligor as of September 30, 2018: ($ in millions) Operating Leases 2018, remaining $ 5 2019 19 2020 17 2021 12 2022 9 Thereafter 76 Total minimum lease payments $ 138 |
Business Acquisition, Pro Forma Information | The following table presents the results of ILG operations included in our Income Statement for the 30 days from the Acquisition Date through the end of the third quarter of 2018. ($ in millions) September 1, 2018 to September 30, 2018 Revenue $ 135 Net loss $ (25 ) Nine Months Ended ($ in millions, except per share data) September 30, 2018 September 30, 2017 Revenues $ 3,172 $ 2,946 Net income (loss) $ 78 $ (17 ) Net income (loss) attributable to common stockholders $ 76 $ (19 ) (LOSSES) EARNINGS PER SHARE ATTRIBUTABLE TO COMMON SHAREHOLDERS Basic $ 1.54 $ (0.39 ) Diluted $ 1.50 $ (0.38 ) |
REVENUE (Tables)
REVENUE (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Revenue from Contract with Customer [Abstract] | |
Disaggregation of Revenue | Sources of Revenue by Segment Three Months Ended September 30, 2018 ($ in millions) Vacation Ownership Exchange & Third-Party Management Corporate and Other Total Sale of vacation ownership products $ 252 $ — $ — $ 252 Ancillary revenues 42 — — 42 Management fee revenues 28 8 (1 ) 35 Other services revenues 21 20 8 49 Management and exchange 91 28 7 126 Rental 86 4 — 90 Cost reimbursements 232 8 (6 ) 234 Revenue from contracts with customers 661 40 1 702 Financing 48 — — 48 Total Revenues $ 709 $ 40 $ 1 $ 750 Three Months Ended September 30, 2017 ($ in millions) Vacation Ownership Exchange & Third-Party Management Corporate and Other Total Sale of vacation ownership products $ 183 $ — $ — $ 183 Ancillary revenues 31 — — 31 Management fee revenues 23 — — 23 Other services revenues 16 — — 16 Management and exchange 70 — — 70 Rental 66 — — 66 Cost reimbursements 177 — — 177 Revenue from contracts with customers 496 — — 496 Financing 34 — — 34 Total Revenues $ 530 $ — $ — $ 530 Nine Months Ended September 30, 2018 ($ in millions) Vacation Ownership Exchange & Third-Party Management Corporate and Other Total Sale of vacation ownership products $ 632 $ — $ — $ 632 Ancillary revenues 106 — — 106 Management fee revenues 78 8 (1 ) 85 Other services revenues 55 20 8 83 Management and exchange 239 28 7 274 Rental 235 4 — 239 Cost reimbursements 650 8 (6 ) 652 Revenue from contracts with customers 1,756 40 1 1,797 Financing 119 — — 119 Total Revenues $ 1,875 $ 40 $ 1 $ 1,916 Nine Months Ended September 30, 2017 ($ in millions) Vacation Ownership Exchange & Third-Party Management Corporate and Other Total Sale of vacation ownership products $ 549 $ — $ — $ 549 Ancillary revenues 91 — — 91 Management fee revenues 67 — — 67 Other services revenues 51 — — 51 Management and exchange 209 — — 209 Rental 203 — — 203 Cost reimbursements 561 — — 561 Revenue from contracts with customers 1,522 — — 1,522 Financing 99 — — 99 Total Revenues $ 1,621 $ — $ — $ 1,621 Timing of Revenue from Contracts with Customers by Segment Three Months Ended September 30, 2018 ($ in millions) Vacation Ownership Exchange & Third-Party Management Corporate and Other Total Services transferred over time $ 367 $ 23 $ 1 $ 391 Goods or services transferred at a point in time 294 17 — 311 Revenue from contracts with customers $ 661 $ 40 $ 1 $ 702 Three Months Ended September 30, 2017 ($ in millions) Vacation Ownership Exchange & Third-Party Management Corporate and Other Total Services transferred over time $ 278 $ — $ — $ 278 Goods or services transferred at a point in time 218 — — 218 Revenue from contracts with customers $ 496 $ — $ — $ 496 Nine Months Ended September 30, 2018 ($ in millions) Vacation Ownership Exchange & Third-Party Management Corporate and Other Total Services transferred over time $ 1,010 $ 23 $ 1 $ 1,034 Goods or services transferred at a point in time 746 17 — 763 Revenue from contracts with customers $ 1,756 $ 40 $ 1 $ 1,797 Nine Months Ended September 30, 2017 ($ in millions) Vacation Ownership Exchange & Third-Party Management Corporate and Other Total Services transferred over time $ 867 $ — $ — $ 867 Goods or services transferred at a point in time 655 — — 655 Revenue from contracts with customers $ 1,522 $ — $ — $ 1,522 |
Contract with Customer, Asset and Liability | The following table shows the composition of our receivables and contract liabilities. We had no contract assets at either September 30, 2018 or December 31, 2017 . ($ in millions) At September 30, 2018 At December 31, 2017 Receivables Accounts receivable $ 46 $ 73 Vacation ownership notes receivable, net 1,959 1,115 $ 2,005 $ 1,188 Contract Liabilities Advance deposits $ 124 $ 84 Deferred revenue 325 69 $ 449 $ 153 |
VACATION OWNERSHIP NOTES RECE_2
VACATION OWNERSHIP NOTES RECEIVABLE (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Receivables [Abstract] | |
Composition of Vacation Ownership Notes Receivable Balances, Net of Reserves | The following table shows the composition of our vacation ownership notes receivable balances, net of reserves. September 30, 2018 December 31, 2017 ($ in millions) Originated Acquired Total Originated Acquired Total Securitized $ 990 $ 567 $ 1,557 $ 814 $ — $ 814 Non-securitized Eligible for securitization (1) 57 86 143 142 — 142 Not eligible for securitization (1) 207 52 259 159 — 159 Subtotal 264 138 402 301 — 301 $ 1,254 $ 705 $ 1,959 $ 1,115 $ — $ 1,115 |
Interest Income Associated with Vacation Ownership Notes Receivable | The following table summarizes interest income associated with vacation ownership notes receivable: Three Months Ended Nine Months Ended ($ in millions) September 30, 2018 September 30, 2017 September 30, 2018 September 30, 2017 Interest income associated with vacation ownership notes receivable — securitized $ 42 $ 27 $ 95 $ 73 Interest income associated with vacation ownership notes receivable — non-securitized 3 6 18 21 Total interest income associated with vacation ownership notes receivable $ 45 $ 33 $ 113 $ 94 |
Schedule Of Accretable Yield | The table below presents a rollforward from the Acquisition Date of the accretable yield (interest income) expected to be earned related to our acquired vacation ownership notes receivable, as well as the amount of non-accretable difference at the end of the period. The non-accretable difference represents estimated contractually required payments in excess of estimated cash flows expected to be collected. The accretable yield represents the excess of estimated cash flows expected to be collected over the carrying amount of the acquired vacation ownership notes receivable. ($ in millions) 30 Days Ended September 30, 2018 Balance at Acquisition Date $ — Acquired accretable yield 373 Accretion (9 ) Reclassification from non-accretable difference — Balance at September 30, 2018 $ 364 Non-accretable difference at September 30, 2018 $ 78 |
Future Principal Payments, Net of Reserves, and Interest Rates of Vacation Ownership Notes Receivable | The following table shows future contractual principal payments, as well as interest rates for our non-securitized and securitized acquired vacation ownership notes receivable at September 30, 2018 : Acquired Vacation Ownership Notes Receivable ($ in millions) Non-Securitized Securitized Total 2018, remaining $ 5 $ 15 $ 20 2019 10 60 70 2020 11 61 72 2021 12 62 74 2022 12 63 75 Thereafter 88 306 394 Balance at September 30, 2018 $ 138 $ 567 $ 705 Weighted average stated interest rate 13.4% 13.4% 13.4% Range of stated interest rates 3.5% to 17.9% 6.0% to 17.9% 3.5% to 17.9% September 30, 2018 : Originated Vacation Ownership Notes Receivable ($ in millions) Non-Securitized Securitized Total 2018, remaining $ 15 $ 25 $ 40 2019 42 99 141 2020 32 103 135 2021 26 107 133 2022 23 109 132 Thereafter 126 547 673 Balance at September 30, 2018 $ 264 $ 990 $ 1,254 Weighted average stated interest rate 11.5% 12.5% 12.3% Range of stated interest rates 0.0% to 18.0% 5.2% to 17.5% 0.0% to 18.0% |
Notes Receivable Reserves | The following table summarizes the activity related to our originated vacation ownership notes receivable reserve: Originated Vacation Ownership Notes Receivable ($ in millions) Non-Securitized Securitized Total Balance at December 31, 2017 $ 58 $ 61 $ 119 Increase in vacation ownership notes receivable reserve 35 7 42 Securitizations (30 ) 30 — Clean-up call (1) 2 (2 ) — Write-offs (31 ) — (31 ) Defaulted vacation ownership notes receivable repurchase activity (2) 23 (23 ) — Balance at September 30, 2018 $ 57 $ 73 $ 130 _________________________ (1) Refers to our voluntary repurchase of previously securitized non-defaulted vacation ownership notes receivable to retire outstanding vacation ownership notes receivable securitizations. (2) |
Recorded Investment in Non-accrual Notes Receivable that are 90 Days or More Past Due | The following table shows our recorded investment in non-accrual vacation ownership notes receivable, which are vacation ownership notes receivable that are 90 days or more past due: Legacy-MVW Vacation Ownership Notes Receivable ($ in millions) Non-Securitized Securitized Total Investment in vacation ownership notes receivable on non-accrual status at September 30, 2018 $ 40 $ 6 $ 46 Investment in vacation ownership notes receivable on non-accrual status at December 31, 2017 $ 39 $ 7 $ 46 Average investment in vacation ownership notes receivable on non-accrual status during the third quarter of 2018 $ 40 $ 6 $ 46 Average investment in vacation ownership notes receivable on non-accrual status during the third quarter of 2017 $ 40 $ 6 $ 46 Average investment in vacation ownership notes receivable on non-accrual status during the first three quarters of 2018 $ 39 $ 7 $ 46 Average investment in vacation ownership notes receivable on non-accrual status during the first three quarters of 2017 $ 42 $ 6 $ 48 |
Aging of Recorded Investment in Principal, Before Reserves, in Vacation Ownership Notes Receivable | The following table shows the aging of the recorded investment in principal, before reserves, in Legacy-MVW vacation ownership notes receivable as of September 30, 2018 : Legacy-MVW Vacation Ownership Notes Receivable ($ in millions) Non-Securitized Securitized Total 31 – 90 days past due $ 5 $ 18 $ 23 91 – 150 days past due 4 6 10 Greater than 150 days past due 36 — 36 Total past due 45 24 69 Current 238 1,039 1,277 Total vacation ownership notes receivable $ 283 $ 1,063 $ 1,346 The following table shows the aging of the recorded investment in principal, before reserves, in Legacy-MVW vacation ownership notes receivable as of December 31, 2017 : Legacy-MVW Vacation Ownership Notes Receivable ($ in millions) Non-Securitized Securitized Total 31 – 90 days past due $ 7 $ 19 $ 26 91 – 150 days past due 5 7 12 Greater than 150 days past due 34 — 34 Total past due 46 26 72 Current 313 849 1,162 Total vacation ownership notes receivable $ 359 $ 875 $ 1,234 September 30, 2018 : Originated Vacation Ownership Notes Receivable Delinquent Defaulted (1) Total Delinquent & Defaulted ($ in millions) Receivables Current 30-59 Days 60-89 Days 90-119 Days >120 Days September 30, 2018 $ 38 $ 38 $ — $ — $ — $ — $ — _________________________ (1) |
Financing Receivable Credit Quality Indicators | The following table shows the Legacy-ILG acquired vacation ownership notes receivable by brand and FICO score as of September 30, 2018 : Acquired Vacation Ownership Notes Receivable ($ in millions) 700 + 600 - 699 < 600 No Score (1) Total Westin $ 174 $ 86 $ 7 $ 24 $ 291 Sheraton 156 133 22 58 369 Hyatt 22 13 1 1 37 Other — — — 8 8 $ 352 $ 232 $ 30 $ 91 $ 705 _________________________ (1) Vacation ownership notes receivable with no FICO score primarily relate to non-U.S. resident borrowers. The following table shows the Legacy-ILG originated vacation ownership notes receivable by brand and FICO score as of September 30, 2018 : Originated Vacation Ownership Notes Receivable ($ in millions) 700 + 600 - 699 < 600 No Score (1) Total Westin $ 13 $ 3 $ 1 $ 2 $ 19 Sheraton 7 5 2 3 17 Hyatt 1 1 — — 2 $ 21 $ 9 $ 3 $ 5 $ 38 _________________________ (1) |
FINANCIAL INSTRUMENTS (Tables)
FINANCIAL INSTRUMENTS (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Investments, All Other Investments [Abstract] | |
Carrying Values and Estimated Fair Values of Financial Assets and Liabilities | Originated Vacation Ownership Notes Receivable At September 30, 2018 At December 31, 2017 ($ in millions) Carrying Amount Fair Value Carrying Amount Fair Value Originated vacation ownership notes receivable Securitized $ 990 $ 1,124 $ 814 $ 955 Eligible for securitization 57 64 142 162 Not eligible for securitization 207 207 159 159 Non-securitized 264 271 301 321 $ 1,254 $ 1,395 $ 1,115 $ 1,276 At September 30, 2018 At December 31, 2017 ($ in millions) Carrying Amount Fair Value Carrying Amount Fair Value Originated vacation ownership notes receivable $ 1,254 $ 1,395 $ 1,115 $ 1,276 Other assets 51 51 14 14 Total financial assets $ 1,305 $ 1,446 $ 1,129 $ 1,290 Non-recourse debt associated with vacation ownership notes receivable securitizations, net $ (1,688 ) $ (1,683 ) $ (835 ) $ (836 ) Exchange Notes, net (88 ) (89 ) — — Senior Unsecured Notes, net (741 ) (772 ) — — IAC Notes (264 ) (264 ) — — Term Loan, net (887 ) (887 ) — — Convertible notes, net (198 ) (238 ) (192 ) (260 ) Non-interest bearing note payable, net (30 ) (30 ) (61 ) (61 ) Other debt, net (19 ) (19 ) — — Total financial liabilities $ (3,915 ) $ (3,982 ) $ (1,088 ) $ (1,157 ) |
EARNINGS PER SHARE (Tables)
EARNINGS PER SHARE (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Earnings Per Share [Abstract] | |
Reconciliation of Earnings and Number of Shares Used in Calculation of Basic and Diluted Earnings Per Share | The table below illustrates the reconciliation of the (loss) earnings and number of shares used in our calculation of basic and diluted (loss) earnings per share. Three Months Ended Nine Months Ended (in millions, except per share amounts) September 30, 2018 September 30, 2017 (1) September 30, 2018 September 30, 2017 (1) Computation of Basic (Loss) Earnings Per Share Attributable to Common Shareholders Net (loss) income attributable to common shareholders $ (58 ) $ 40 $ (11 ) $ 116 Shares for basic (loss) earnings per share 32.8 27.1 28.8 27.2 Basic (loss) earnings per share $ (1.75 ) $ 1.49 $ (0.37 ) $ 4.27 Computation of Diluted (Loss) Earnings Per Share Attributable to Common Shareholders Net (loss) income attributable to common shareholders $ (58 ) $ 40 $ (11 ) $ 116 Shares for basic (loss) earnings per share 32.8 27.1 28.8 27.2 Effect of dilutive shares outstanding Employee stock options and SARs — 0.4 — 0.5 Restricted stock units — 0.2 — 0.2 Shares for diluted earnings per share 32.8 27.7 28.8 27.9 Diluted (loss) earnings per share $ (1.75 ) $ 1.45 $ (0.37 ) $ 4.18 _________________________ (1) The computations of diluted earnings per share exclude approximately 289,000 shares of common stock, the maximum number of shares issuable as of September 30, 2017 |
INVENTORY (Tables)
INVENTORY (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Inventory Disclosure [Abstract] | |
Composition of Inventory | The following table shows the composition of our inventory balances: ($ in millions) At September 30, 2018 At December 31, 2017 Finished goods (1) $ 761 $ 391 Work-in-progress 55 2 Real estate inventory 816 393 Operating supplies and retail inventory 13 5 $ 829 $ 398 _________________________ (1) |
SECURITIZED DEBT (Tables)
SECURITIZED DEBT (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Debt Disclosure [Abstract] | |
Schedule of Securitized Vacation Ownership Debt | The following table provides detail on our debt associated with vacation ownership notes receivable securitizations, net of unamortized debt issuance costs: ($ in millions) At September 30, 2018 At December 31, 2017 Vacation ownership notes receivable securitizations, gross (1) 1,034 845 Unamortized debt issuance costs (13 ) (10 ) 1,021 835 Legacy-ILG Vacation ownership notes receivable securitizations (2) 667 — $ 1,688 $ 835 _________________________ (1) Interest rates as of September 30, 2018 range from 2.2% to 6.3% , with a weighted average interest rate of 2.9% . (2) Interest rates as of September 30, 2018 range from 2.3% to 4.0% , with a weighted average interest rate of 2.9% |
Scheduled Future Principal Payments for Debt | The following table shows scheduled future principal payments for our vacation ownership notes receivable securitizations as of September 30, 2018 : Vacation Ownership Notes Receivable Securitizations (1) ($ in millions) Legacy-MVW Legacy-ILG Total Payments Year 2018, remaining $ 26 $ 43 $ 69 2019 102 161 263 2020 106 120 226 2021 110 93 203 2022 113 72 185 Thereafter 577 178 755 $ 1,034 $ 667 $ 1,701 _________________________ (1) September 30, 2018 : ($ in millions) Exchange Notes Senior Unsecured Notes IAC Notes Term Loan Convertible Notes Non-Interest Bearing Note Payable Capital Other Total Payments Year 2018, remaining $ — $ — $ — $ — $ — $ — $ — $ 1 $ 1 2019 — — — 9 — 31 8 1 49 2020 — — — 9 — — — 2 11 2021 — — — 9 — — — 2 11 2022 — — — 9 230 — — 2 241 Thereafter 89 750 264 864 — — — 11 1,978 $ 89 $ 750 $ 264 $ 900 $ 230 $ 31 $ 8 $ 19 $ 2,291 |
DEBT (Tables)
DEBT (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Debt Disclosure [Abstract] | |
Debt Balances, Net of Unamortized Debt Issuance Costs | The following table provides detail on our debt balances, net of unamortized debt discount and issuance costs: ($ in millions) At September 30, 2018 At December 31, 2017 Senior Notes Exchange Notes (1) $ 89 $ — Unamortized debt issuance costs (1 ) — 88 — Senior Unsecured Notes (2) 750 — Unamortized debt issuance costs (9 ) — 741 — IAC Notes (3) 264 — Corporate Credit Facility Term Loan 900 — Unamortized debt discount and issuance costs (13 ) — 887 — Convertible notes, gross (4) 230 230 Unamortized debt discount and issuance costs (32 ) (38 ) 198 192 Non-Interest bearing note payable 31 64 Unamortized debt discount (5) (1 ) (3 ) 30 61 Capital leases 8 7 Other 19 — $ 2,235 $ 260 _________________________ (1) Interest rate of 5.625% , face amount of $88 million , maturing on April 15, 2023 . (2) Interest rate of 6.500% , face amount of $750 million , maturing on September 15, 2026 . (3) Interest rate of 5.625% , face amount of $262 million , maturing on April 15, 2023 . (4) The effective interest rate as of September 30, 2018 was 4.7% . (5) Debt discount based on imputed interest rate of 6.0% . |
Scheduled Future Principal Payments for Debt | The following table shows scheduled future principal payments for our vacation ownership notes receivable securitizations as of September 30, 2018 : Vacation Ownership Notes Receivable Securitizations (1) ($ in millions) Legacy-MVW Legacy-ILG Total Payments Year 2018, remaining $ 26 $ 43 $ 69 2019 102 161 263 2020 106 120 226 2021 110 93 203 2022 113 72 185 Thereafter 577 178 755 $ 1,034 $ 667 $ 1,701 _________________________ (1) September 30, 2018 : ($ in millions) Exchange Notes Senior Unsecured Notes IAC Notes Term Loan Convertible Notes Non-Interest Bearing Note Payable Capital Other Total Payments Year 2018, remaining $ — $ — $ — $ — $ — $ — $ — $ 1 $ 1 2019 — — — 9 — 31 8 1 49 2020 — — — 9 — — — 2 11 2021 — — — 9 — — — 2 11 2022 — — — 9 230 — — 2 241 Thereafter 89 750 264 864 — — — 11 1,978 $ 89 $ 750 $ 264 $ 900 $ 230 $ 31 $ 8 $ 19 $ 2,291 |
Convertible Debt | The following table shows the net carrying value of the Convertible Notes: ($ in millions) At September 30, 2018 At December 31, 2017 Liability component Principal amount $ 230 $ 230 Unamortized debt discount (27 ) (32 ) Unamortized debt issuance costs (5 ) (6 ) Net carrying amount of the liability component $ 198 $ 192 Carrying amount of equity component, net of issuance costs $ 33 $ 33 The following table shows interest expense information related to the Convertible Notes: Three Months Ended Nine Months Ended ($ in millions) September 30, 2018 September 30, 2017 September 30, 2018 September 30, 2017 Contractual interest expense $ 1 $ — $ 3 $ — Amortization of debt discount 1 — 4 — Amortization of debt issuance costs 1 — 1 — $ 3 $ — $ 8 $ — |
SHAREHOLDERS' EQUITY (Tables)
SHAREHOLDERS' EQUITY (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Equity [Abstract] | |
Stock Repurchase Activity under Current Stock Repurchase Program | The following table summarizes share repurchase activity under our current share repurchase program: ($ in millions, except per share amounts) Number of Shares Repurchased Cost of Shares Repurchased Average Price Paid per Share As of December 31, 2017 10,440,505 $ 697 $ 66.73 For the first three quarters of 2018 13,969 2 134.70 As of September 30, 2018 10,454,474 $ 699 $ 66.83 |
Cash Dividend Declared | We declared cash dividends to holders of common stock during the first three quarters of 2018 as follows: Declaration Date Shareholder Record Date Distribution Date Dividend per Share February 16, 2018 March 1, 2018 March 15, 2018 $0.40 May 14, 2018 May 28, 2018 June 11, 2018 $0.40 September 6, 2018 September 20, 2018 October 4, 2018 $0.40 |
SHARE-BASED COMPENSATION (Table
SHARE-BASED COMPENSATION (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Schedule of Compensation Cost for Share-based Payment Arrangements, Allocation of Share-based Compensation Costs by Plan | The following table details our share-based compensation expense related to award grants to our officers, directors and employees: Three Months Ended Nine Months Ended ($ in millions) September 30, 2018 September 30, 2017 September 30, 2018 September 30, 2017 Service-based RSUs $ 3 $ 3 $ 9 $ 8 Performance-based RSUs 1 1 4 3 4 4 13 11 SARs 1 — 2 1 Stock options — — — — $ 5 $ 4 $ 15 $ 12 |
Schedule of Unrecognized Compensation Cost, Nonvested Awards | The following table details our deferred compensation costs related to unvested awards: ($ in millions) At September 30, 2018 At December 31, 2017 Service-based RSUs $ 17 $ 9 Performance-based RSUs 7 5 24 14 SARs 1 1 Stock options — — $ 25 $ 15 |
Assumptions Used to Estimate Fair Value of Grants | The following table outlines the assumptions used to estimate the fair value of grants during the first three quarters of 2018: Expected volatility 30.78% Dividend yield 1.11% Risk-free rate 2.68% Expected term (in years) 6.25 |
VARIABLE INTEREST ENTITIES (Tab
VARIABLE INTEREST ENTITIES (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Classifications of Consolidated VIE Assets and Liabilities | The following table shows consolidated assets, which are collateral for the obligations of these variable interest entities, and consolidated liabilities included on our Balance Sheet at September 30, 2018 : ($ in millions) Vacation Ownership Notes Receivable Securitizations Warehouse Credit Facility Total Consolidated Assets Vacation ownership notes receivable, net of reserves $ 1,557 $ — $ 1,557 Interest receivable 10 — 10 Restricted cash (1) 130 — 130 Total $ 1,697 $ — $ 1,697 Consolidated Liabilities Interest payable $ 2 $ — $ 2 Debt 1,701 — 1,701 Total $ 1,703 $ — $ 1,703 _________________________ (1) Includes $71 million of the proceeds from the securitization transaction completed prior to the ILG Acquisition, which will be released when the remaining vacation ownership notes receivable are purchased by the 2018-A Trust. Refer to Footnote 10 “Securitized Debt” for a discussion of the terms of this securitization and the purchase of additional vacation ownership notes receivable by the 2018-A Trust subsequent to the third quarter of 2018. |
Interest Income and Expense Recognized as a Result of Our Involvement with Variable Interest Entities | The following table shows the interest income and expense recognized as a result of our involvement with these variable interest entities during the third quarter of 2018: ($ in millions) Vacation Ownership Notes Receivable Securitizations Warehouse Credit Facility Total Interest income $ 42 $ — $ 42 Interest expense to investors $ 10 $ 1 $ 11 Debt issuance cost amortization $ 1 $ — $ 1 The following table shows the interest income and expense recognized as a result of our involvement with these variable interest entities during the first three quarters of 2018: ($ in millions) Vacation Ownership Notes Receivable Securitizations Warehouse Credit Facility Total Interest income $ 95 $ — $ 95 Interest expense to investors $ 20 $ 1 $ 21 Debt issuance cost amortization $ 3 $ 1 $ 4 |
Cash Flows Between Company and Variable Interest Entities | The following table shows cash flows between us and the vacation ownership notes receivable securitization variable interest entities: Nine Months Ended ($ in millions) September 30, 2018 September 30, 2017 Cash Inflows Net proceeds from vacation ownership notes receivable securitizations $ 419 $ 347 Principal receipts 227 171 Interest receipts 92 71 Reserve release 109 — Total 847 589 Cash Outflows Principal to investors (208 ) (159 ) Voluntary repurchases of defaulted vacation ownership notes receivable (34 ) (23 ) Voluntary clean-up call (22 ) — Interest to investors (19 ) (13 ) Funding of restricted cash (1) (117 ) (2 ) Total (400 ) (197 ) Net Cash Flows $ 447 $ 392 _________________________ (1) Includes $106 million of the proceeds from the securitization transaction completed during the second quarter of 2018, which were released when the remaining vacation ownership notes receivable were purchased by the 2018-1 Trust during the third quarter of 2018. The following table shows cash flows between us and the Warehouse Credit Facility variable interest entity: Nine Months Ended ($ in millions) September 30, 2018 September 30, 2017 Cash Inflows Proceeds from vacation ownership notes receivable securitizations $ — $ 50 Principal receipts — 2 Interest receipts — 2 Total — 54 Cash Outflows Principal to investors — (1 ) Repayment of Warehouse Credit Facility — (49 ) Interest to investors (1 ) (2 ) Total (1 ) (52 ) Net Cash Flows $ (1 ) $ 2 |
BUSINESS SEGMENTS (Tables)
BUSINESS SEGMENTS (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Segment Reporting [Abstract] | |
Revenues | Revenues Three Months Ended Nine Months Ended ($ in millions) September 30, 2018 September 30, 2017 September 30, 2018 September 30, 2017 Vacation Ownership $ 709 $ 530 $ 1,875 $ 1,621 Exchange & Third-Party Management 40 — 40 — Total segment revenues 749 530 1,915 1,621 Corporate and other 1 — 1 — $ 750 $ 530 $ 1,916 $ 1,621 |
Net Income (Loss) | Net (Loss) Income Three Months Ended Nine Months Ended ($ in millions) September 30, 2018 September 30, 2017 September 30, 2018 September 30, 2017 Vacation Ownership $ 96 $ 92 $ 259 $ 268 Exchange & Third-Party Management 12 — 12 — Total segment financial results 108 92 271 268 Corporate and other (176 ) (29 ) (275 ) (90 ) Provision for income taxes 10 (23 ) (7 ) (62 ) $ (58 ) $ 40 $ (11 ) $ 116 |
ADOPTION IMPACT OF NEW REVENU_2
ADOPTION IMPACT OF NEW REVENUE STANDARD (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Revenue from Contract with Customer [Abstract] | |
Schedule of New Accounting Pronouncement | The following tables present the impact of the adoption of the new Revenue Standard on our previously reported historical results for the periods presented. Income Statement Impact - Third Quarter of 2017 Three Months Ended September 30, 2017 ($ in millions) As Reported ASC 606 Adjustments Conforming Reclassifications (1) As Adjusted REVENUES Sale of vacation ownership products $ 180 $ 3 $ — $ 183 Resort management and other services 77 (7 ) (70 ) — Management and exchange — — 70 70 Rental 81 (15 ) — 66 Financing 34 — — 34 Cost reimbursements 114 63 — 177 TOTAL REVENUES 486 44 — 530 EXPENSES Cost of vacation ownership products 43 3 — 46 Marketing and sales 100 (4 ) (2 ) 94 Resort management and other services 45 (5 ) (40 ) — Management and exchange — — 38 38 Rental 71 (13 ) (1 ) 57 Financing 5 — 6 11 General and administrative 27 — (1 ) 26 Depreciation and amortization — — 6 6 Litigation settlement 2 — — 2 Consumer financing interest 6 — (6 ) — Royalty fee 15 — — 15 Cost reimbursements 114 63 — 177 TOTAL EXPENSES 428 44 — 472 Gains and other income, net 7 — — 7 Interest expense (2 ) — — (2 ) INCOME BEFORE INCOME TAXES AND NONCONTROLLING INTERESTS 63 — — 63 Provision for income taxes (22 ) (1 ) — (23 ) NET INCOME 41 (1 ) — 40 Net income attributable to noncontrolling interests — — — — NET INCOME ATTRIBUTABLE TO COMMON SHAREHOLDERS $ 41 $ (1 ) $ — $ 40 Earnings per share - Basic $ 1.50 $ (0.01 ) $ — $ 1.49 Earnings per share - Diluted $ 1.47 $ (0.02 ) $ — $ 1.45 _________________________ (1) We have reclassified certain prior year amounts to conform to our current quarter presentation. See Footnote 1 “Summary of Significant Accounting Policies” for a description of the reclassifications. Income Statement Impact - First Three Quarters of 2017 Nine Months Ended September 30, 2017 ($ in millions) As Reported ASC 606 Adjustments Conforming Reclassifications (1) As Adjusted REVENUES Sale of vacation ownership products $ 544 $ 5 $ — $ 549 Resort management and other services 229 (20 ) (209 ) — Management and exchange — — 209 209 Rental 250 (47 ) — 203 Financing 99 — — 99 Cost reimbursements 348 213 — 561 TOTAL REVENUES 1,470 151 — 1,621 EXPENSES Cost of vacation ownership products 132 9 — 141 Marketing and sales 305 (13 ) (5 ) 287 Resort management and other services 130 (13 ) (117 ) — Management and exchange — — 111 111 Rental 212 (42 ) (2 ) 168 Financing 12 — 18 30 General and administrative 84 — (3 ) 81 Depreciation and amortization — — 16 16 Litigation settlement 2 — — 2 Consumer financing interest 18 — (18 ) — Royalty fee 47 — — 47 Cost reimbursements 348 213 — 561 TOTAL EXPENSES 1,290 154 — 1,444 Gains and other income, net 7 — — 7 Interest expense (5 ) — — (5 ) ILG acquisition costs — — (1 ) (1 ) Other (1 ) — 1 — INCOME BEFORE INCOME TAXES AND NONCONTROLLING INTERESTS 181 (3 ) — 178 Provision for income taxes (62 ) — — (62 ) NET INCOME 119 (3 ) — 116 Net income attributable to noncontrolling interests — — — — NET INCOME ATTRIBUTABLE TO COMMON SHAREHOLDERS $ 119 $ (3 ) $ — $ 116 Earnings per share - Basic $ 4.36 $ (0.09 ) $ — $ 4.27 Earnings per share - Diluted $ 4.26 $ (0.08 ) $ — $ 4.18 _________________________ (1) We have reclassified certain prior year amounts to conform to our current quarter presentation. See Footnote 1 “Summary of Significant Accounting Policies” for a description of the reclassifications. Balance Sheet Impact As of December 31, 2017 ($ in millions) As Reported ASC 606 Adjustments Conforming Reclassifications (1) As Adjusted ASSETS Cash and cash equivalents $ 409 $ — $ — $ 409 Restricted cash 82 — — 82 Accounts receivable, net 154 (62 ) — 92 Vacation ownership notes receivable, net 1,120 (5 ) — 1,115 Inventory 716 12 (330 ) 398 Property and equipment 253 — 330 583 Other 172 (6 ) — 166 TOTAL ASSETS $ 2,906 $ (61 ) $ — $ 2,845 LIABILITIES AND EQUITY Accounts payable $ 145 $ — $ — $ 145 Advance deposits 63 21 — 84 Accrued liabilities 168 (48 ) — 120 Deferred revenue 98 (29 ) — 69 Payroll and benefits liability 112 — — 112 Deferred compensation liability 75 — — 75 Securitized debt — — 835 835 Debt, net 1,095 — (835 ) 260 Other 14 — — 14 Deferred taxes 91 (1 ) — 90 TOTAL LIABILITIES 1,861 (57 ) — 1,804 Preferred stock — — — — Common stock — — — — Treasury stock (694 ) — — (694 ) Additional paid-in capital 1,189 — — 1,189 Accumulated other comprehensive income 17 — — 17 Retained earnings 533 (4 ) — 529 TOTAL EQUITY 1,045 (4 ) — 1,041 TOTAL LIABILITIES AND EQUITY $ 2,906 $ (61 ) $ — $ 2,845 ___________________ (1) We have reclassified certain prior year amounts to conform to our current quarter presentation. See Footnote 1 “Summary of Significant Accounting Policies” for a description of the reclassifications. Cash Flow Impact - Operating Activities Nine Months Ended September 30, 2017 ($ in millions) As Reported Adjustments As Adjusted OPERATING ACTIVITIES Net income $ 119 $ (3 ) $ 116 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation 16 — 16 Amortization of debt discount and issuance costs 6 — 6 Vacation ownership notes receivable reserve 38 2 40 Share-based compensation 12 — 12 Deferred income taxes 21 2 23 Net change in assets and liabilities: Accounts receivable 25 (2 ) 23 Vacation ownership notes receivable originations (346 ) 1 (345 ) Vacation ownership notes receivable collections 204 — 204 Inventory 28 (2 ) 26 Purchase of vacation ownership units for future transfer to inventory (34 ) — (34 ) Other assets 23 11 34 Accounts payable, advance deposits and accrued liabilities (65 ) (13 ) (78 ) Deferred revenue 7 3 10 Payroll and benefit liabilities 1 — 1 Deferred compensation liability 10 — 10 Other liabilities (1 ) 1 — Other, net 7 — 7 Net cash provided by operating activities $ 71 $ — $ 71 |
SUPPLEMENTAL GUARANTOR INFORM_2
SUPPLEMENTAL GUARANTOR INFORMATION (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Guarantees and Product Warranties [Abstract] | |
Balance Sheet | Balance Sheet As of September 30, 2018 ($ in millions) MVW ILG Interval Acquisition Corp. Guarantor Subsidiaries Non-Guarantor Subsidiaries Total Eliminations MVW Consolidated Cash and cash equivalents $ — $ 2 $ 2 $ 37 $ 400 $ — $ 441 Restricted cash — — — 52 313 — 365 Accounts receivable, net 21 — 21 63 159 (28 ) 236 Vacation ownership notes receivable, net — — — 162 1,797 — 1,959 Inventory — — — 465 364 — 829 Property and equipment — 1 — 282 669 — 952 Goodwill (1) 2,747 — — — — — 2,747 Intangibles, net — — — 1,178 38 — 1,216 Investments in subsidiaries 1,251 (75 ) 1,290 1,100 — (3,566 ) — Other 28 — 2 137 139 (38 ) 268 Total assets $ 4,047 $ (72 ) $ 1,315 $ 3,476 $ 3,879 $ (3,632 ) $ 9,013 Accounts payable $ 33 $ — $ — $ 46 $ 94 $ 8 $ 181 Advance deposits — — — 29 95 — 124 Accrued liabilities 11 4 — 154 235 (34 ) 370 Deferred revenue — — — 121 204 — 325 Payroll and benefits liability 16 — — 75 103 — 194 Deferred compensation liability — — — 8 86 — 94 Securitized debt, net — — — — 1,688 — 1,688 Debt, net 198 — 264 — 1,773 — 2,235 Other 2 — — 1 12 — 15 Deferred taxes 74 84 87 25 (6 ) 2 266 Intercompany liabilities (receivables) / equity 2,667 (931 ) 1,039 1,729 (3,397 ) (1,107 ) — MVW shareholders' equity 1,046 771 (75 ) 1,290 2,958 (2,494 ) 3,496 Noncontrolling interests — — — (2 ) 34 (7 ) 25 Total liabilities and equity $ 4,047 $ (72 ) $ 1,315 $ 3,476 $ 3,879 $ (3,632 ) $ 9,013 |
Income Statement | Thirty Days Ended September 30, 2018 ($ in millions) MVW ILG Interval Acquisition Corp. Guarantor Subsidiaries Non-Guarantor Subsidiaries Total Eliminations MVW Consolidated Revenues $ — $ — $ — $ 114 $ 356 $ — $ 470 Expenses (3 ) (4 ) — (138 ) (345 ) — (490 ) Interest expense — — (1 ) — (4 ) — (5 ) ILG acquisition-related costs (42 ) — — — (30 ) — (72 ) Income tax benefit 14 1 — 7 7 — 29 Net loss (31 ) (3 ) (1 ) (17 ) (16 ) — (68 ) Net loss attributable to noncontrolling interests — — — — — — — Net loss attributable to common shareholders $ (31 ) $ (3 ) $ (1 ) $ (17 ) $ (16 ) $ — $ (68 ) |
Cash Flow | Cash Flows Thirty Days Ended September 30, 2018 ($ in millions) MVW ILG Interval Acquisition Corp. Guarantor Subsidiaries Non-Guarantor Subsidiaries MVW Consolidated Net cash and restricted cash provided by (used in) operating activities $ 60 $ — $ (2 ) $ (32 ) $ 41 $ 67 Net cash and restricted cash used in investing activities (13 ) — — (2 ) (1,408 ) (1,423 ) Net cash and restricted cash (used in) provided by financing activities (47 ) — 2 (4 ) 1,720 1,671 Cash, cash equivalents and restricted cash, beginning of period — 2 2 126 361 491 Cash, cash equivalents and restricted cash, end of period $ — $ 2 $ 2 $ 88 $ 714 $ 806 |
SUMMARY OF SIGNIFICANT ACCOUN_3
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details) - USD ($) $ in Millions | 9 Months Ended | |
Sep. 30, 2018 | Dec. 31, 2017 | |
Error Corrections and Prior Period Adjustments Restatement [Line Items] | ||
Percent of the assets, liabilities, revenues, expenses and cash flows discussed | 100.00% | |
Property and equipment | $ 952 | $ 583 |
Inventory | 829 | 398 |
Debt, net | 2,235 | 260 |
Securitized debt, net | 835 | |
Conforming Reclassifications | ||
Error Corrections and Prior Period Adjustments Restatement [Line Items] | ||
Property and equipment | 330 | |
Inventory | (330) | |
Debt, net | (835) | |
Securitized debt, net | $ 835 | |
Securitized debt | ||
Error Corrections and Prior Period Adjustments Restatement [Line Items] | ||
Securitized debt, net | $ 1,688 |
ACQUISITIONS AND DISPOSITIONS -
ACQUISITIONS AND DISPOSITIONS - Additional Information (Details) $ / shares in Units, $ in Millions | 3 Months Ended | 9 Months Ended | |||
Mar. 31, 2018USD ($)vacation_ownership_unit | Jun. 30, 2017USD ($)vacation_ownership_unit | Sep. 30, 2018USD ($)Property | Sep. 30, 2017USD ($) | Sep. 01, 2018$ / shares | |
Business Acquisition [Line Items] | |||||
Vacation ownership product, financing term | 10 years | ||||
Number of hotels acquired | Property | 4 | ||||
Business combinations, pro forma, acquisition-related costs | $ 34 | $ 169 | |||
Purchase of vacation ownership units for future transfer to inventory | 0 | 34 | |||
Non-cash issuance of debt in connection with acquisition of vacation ownership units | $ 0 | $ 64 | |||
Marco Island Florida | |||||
Business Acquisition [Line Items] | |||||
Number of vacation ownership units acquired | vacation_ownership_unit | 20 | 36 | |||
Payments to acquire real estate | $ 24 | ||||
Purchase of vacation ownership units for future transfer to inventory | $ 34 | ||||
Big Island Of Hawaii | |||||
Business Acquisition [Line Items] | |||||
Number of vacation ownership units acquired | vacation_ownership_unit | 112 | ||||
Payments to acquire real estate | $ 27 | ||||
Noncash transaction, value of consideration | 1 | ||||
Non-cash issuance of debt in connection with acquisition of vacation ownership units | $ 64 | ||||
ILG, Inc | |||||
Business Acquisition [Line Items] | |||||
Business combination, share conversion ratio | 0.165 | ||||
Business combination, share price (in usd per share) | $ / shares | $ 119 | ||||
ILG, Inc | Minimum | |||||
Business Acquisition [Line Items] | |||||
Vacation ownership product, financing term | 5 years | ||||
Renewal term options | 1 year | ||||
ILG, Inc | Maximum | |||||
Business Acquisition [Line Items] | |||||
Vacation ownership product, financing term | 15 years | ||||
Initial term of most leases (up to) | 5 years | ||||
Renewal term options | 3 years | ||||
ILG, Inc | ILG, Inc | |||||
Business Acquisition [Line Items] | |||||
Business combination, share price (in usd per share) | $ / shares | $ 14.75 |
ACQUISITIONS AND DISPOSITIONS_2
ACQUISITIONS AND DISPOSITIONS - Deferred Revenue Narrative (Details) - Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2018-10-01 | Sep. 30, 2018 |
Business Acquisition [Line Items] | |
Expected timing of satisfaction, period | 2 years |
Minimum | Sale of vacation ownership products | |
Business Acquisition [Line Items] | |
Expected timing of satisfaction, period | 1 year |
Maximum | Sale of vacation ownership products | |
Business Acquisition [Line Items] | |
Expected timing of satisfaction, period | 5 years |
ACQUISITIONS AND DISPOSITIONS_3
ACQUISITIONS AND DISPOSITIONS - Consideration Transferred (Details) - ILG, Inc - USD ($) $ / shares in Units, shares in Millions, $ in Millions | Sep. 01, 2018 | Aug. 31, 2018 |
Business Acquisition [Line Items] | ||
Equivalent shares of Marriott Vacations Worldwide common stock issued in exchange for ILG outstanding shares (in shares) | 20.5 | |
Marriott Vacations Worldwide common stock price as of Acquisition Date (in dollars per share) | $ 119 | |
Fair value of Marriott Vacations Worldwide common stock issued in exchange for ILG outstanding shares | $ 2,441 | |
Cash consideration to ILG shareholders, net of cash acquired of $154 million | 1,680 | |
Fair value of ILG equity-based awards attributed to pre-combination service | 64 | |
Total consideration transferred, net of cash acquired | 4,185 | |
Noncontrolling interests | 25 | |
Total shareholder equity | $ 4,210 | |
Cash acquired from acquisition | $ 154 |
ACQUISITIONS AND DISPOSITIONS_4
ACQUISITIONS AND DISPOSITIONS - Preliminary Fair Values of Assets Acquired and Liabilities Assumed (Details) - USD ($) $ in Millions | Sep. 30, 2018 | Sep. 01, 2018 | Dec. 31, 2017 |
Business Acquisition [Line Items] | |||
Goodwill | $ 2,747 | $ 0 | |
ILG, Inc | |||
Business Acquisition [Line Items] | |||
Vacation ownership notes receivable | $ 736 | ||
Inventory | 494 | ||
Property and equipment | 384 | ||
Intangible assets | 1,223 | ||
Other assets | 581 | ||
Deferred revenue | (217) | ||
Deferred taxes | (174) | ||
Debt | (392) | ||
Securitized debt from VIEs | (696) | ||
Other liabilities | (476) | ||
Net assets acquired | 1,463 | ||
Goodwill | 2,747 | ||
Assets acquired | $ 4,210 |
ACQUISITIONS AND DISPOSITIONS_5
ACQUISITIONS AND DISPOSITIONS - Intangible Assets (Details) - ILG, Inc $ in Millions | Sep. 01, 2018USD ($) |
Business Acquisition [Line Items] | |
Intangible assets | $ 1,223 |
Management contracts | |
Business Acquisition [Line Items] | |
Estimated Fair Value | 33 |
Trade names and trademarks | |
Business Acquisition [Line Items] | |
Estimated Fair Value | 82 |
Member relationships | |
Business Acquisition [Line Items] | |
Estimated Fair Value | $ 754 |
Member relationships | Minimum | |
Business Acquisition [Line Items] | |
Estimated Useful Life | 10 years |
Member relationships | Maximum | |
Business Acquisition [Line Items] | |
Estimated Useful Life | 15 years |
Management contracts | |
Business Acquisition [Line Items] | |
Estimated Fair Value | $ 354 |
Management contracts | Minimum | |
Business Acquisition [Line Items] | |
Estimated Useful Life | 15 years |
Management contracts | Maximum | |
Business Acquisition [Line Items] | |
Estimated Useful Life | 25 years |
ACQUISITIONS AND DISPOSITIONS_6
ACQUISITIONS AND DISPOSITIONS - Future Minimum Lease Obligations (Details) - ILG, Inc $ in Millions | Sep. 30, 2018USD ($) |
Operating Leases | |
2018, remaining | $ 5 |
2,019 | 19 |
2,020 | 17 |
2,021 | 12 |
2,022 | 9 |
Thereafter | 76 |
Total minimum lease payments | $ 138 |
ACQUISITIONS AND DISPOSITIONS_7
ACQUISITIONS AND DISPOSITIONS - Pro Forma Results of Operations (Details) - ILG, Inc - USD ($) $ / shares in Units, $ in Millions | 9 Months Ended | |
Sep. 30, 2018 | Sep. 30, 2017 | |
Business Acquisition [Line Items] | ||
Revenues | $ 3,172 | $ 2,946 |
Net income (loss) | 78 | (17) |
Net income (loss) attributable to common stockholders | $ 76 | $ (19) |
(LOSSES) EARNINGS PER SHARE ATTRIBUTABLE TO COMMON SHAREHOLDERS | ||
Basic (in usd per share) | $ 1.54 | $ (0.39) |
Diluted (in usd per share) | $ 1.50 | $ (0.38) |
ACQUISITIONS AND DISPOSITIONS_8
ACQUISITIONS AND DISPOSITIONS - ILG Results of Operations (Details) - ILG, Inc $ in Millions | 1 Months Ended |
Sep. 30, 2018USD ($) | |
Business Acquisition [Line Items] | |
Revenue | $ 135 |
Net loss | $ (25) |
REVENUE - Additional Informatio
REVENUE - Additional Information (Details) - USD ($) | 3 Months Ended | 9 Months Ended | |
Sep. 30, 2018 | Sep. 30, 2018 | Dec. 31, 2017 | |
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | |||
Contract with customer, performance obligation, decrease in revenue | $ (1,000,000) | $ (3,000,000) | |
Vacation ownership products, sales incentives, period | 2 years | ||
Vacation ownership product, financing term | 10 years | ||
Contract with customer, contract assets | 0 | $ 0 | $ 0 |
Contract with customer, liability, revenue recognized | $ 13,000,000 | $ 107,000,000 | |
Minimum | |||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | |||
Number of days for payments to commence under financing contracts after closing | 30 days | ||
Rental expiration period | 6 months | ||
Maximum | |||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | |||
Number of days for payments to commence under financing contracts after closing | 60 days | ||
Rental expiration period | 24 months |
REVENUE - Revenue with Customer
REVENUE - Revenue with Customers (Details) - USD ($) $ in Millions | 1 Months Ended | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | |
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | |||||
Revenue from contracts with customers | $ 702 | $ 496 | $ 1,797 | $ 1,522 | |
Cost reimbursements | 234 | 177 | 652 | 561 | |
Financing | 48 | 34 | 119 | 99 | |
TOTAL REVENUES | $ 470 | 750 | 530 | 1,916 | 1,621 |
Vacation Ownership | |||||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | |||||
Revenue from contracts with customers | 661 | 496 | 1,756 | 1,522 | |
Cost reimbursements | 232 | 177 | 650 | 561 | |
Financing | 48 | 34 | 119 | 99 | |
TOTAL REVENUES | 709 | 530 | 1,875 | 1,621 | |
Exchange & Third-Party Management | |||||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | |||||
Revenue from contracts with customers | 40 | 0 | 40 | 0 | |
Cost reimbursements | 8 | 0 | 8 | 0 | |
Financing | 0 | 0 | 0 | 0 | |
TOTAL REVENUES | 40 | 0 | 40 | 0 | |
Sale of vacation ownership products | |||||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | |||||
Revenue from contracts with customers | 252 | 183 | 632 | 549 | |
Sale of vacation ownership products | Vacation Ownership | |||||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | |||||
Revenue from contracts with customers | 252 | 183 | 632 | 549 | |
Sale of vacation ownership products | Exchange & Third-Party Management | |||||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | |||||
Revenue from contracts with customers | 0 | 0 | 0 | 0 | |
Ancillary revenues | |||||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | |||||
Revenue from contracts with customers | 42 | 31 | 106 | 91 | |
Ancillary revenues | Vacation Ownership | |||||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | |||||
Revenue from contracts with customers | 42 | 31 | 106 | 91 | |
Ancillary revenues | Exchange & Third-Party Management | |||||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | |||||
Revenue from contracts with customers | 0 | 0 | 0 | 0 | |
Management fee revenues | |||||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | |||||
Revenue from contracts with customers | 35 | 23 | 85 | 67 | |
Management fee revenues | Vacation Ownership | |||||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | |||||
Revenue from contracts with customers | 28 | 23 | 78 | 67 | |
Management fee revenues | Exchange & Third-Party Management | |||||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | |||||
Revenue from contracts with customers | 8 | 0 | 8 | 0 | |
Other services revenues | |||||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | |||||
Revenue from contracts with customers | 49 | 16 | 83 | 51 | |
Other services revenues | Vacation Ownership | |||||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | |||||
Revenue from contracts with customers | 21 | 16 | 55 | 51 | |
Other services revenues | Exchange & Third-Party Management | |||||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | |||||
Revenue from contracts with customers | 20 | 0 | 20 | 0 | |
Resort management and other services | |||||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | |||||
Revenue from contracts with customers | 126 | 70 | 274 | 209 | |
Resort management and other services | Vacation Ownership | |||||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | |||||
Revenue from contracts with customers | 91 | 70 | 239 | 209 | |
Resort management and other services | Exchange & Third-Party Management | |||||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | |||||
Revenue from contracts with customers | 28 | 0 | 28 | 0 | |
Rental | |||||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | |||||
Revenue from contracts with customers | 90 | 66 | 239 | 203 | |
Rental | Vacation Ownership | |||||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | |||||
Revenue from contracts with customers | 86 | 66 | 235 | 203 | |
Rental | Exchange & Third-Party Management | |||||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | |||||
Revenue from contracts with customers | 4 | 0 | 4 | 0 | |
Corporate and other | |||||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | |||||
Revenue from contracts with customers | 1 | 0 | 1 | 0 | |
Cost reimbursements | (6) | 0 | (6) | 0 | |
Financing | 0 | 0 | 0 | 0 | |
TOTAL REVENUES | 1 | 0 | 1 | 0 | |
Corporate and other | Sale of vacation ownership products | |||||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | |||||
Revenue from contracts with customers | 0 | 0 | 0 | 0 | |
Corporate and other | Ancillary revenues | |||||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | |||||
Revenue from contracts with customers | 0 | 0 | 0 | 0 | |
Corporate and other | Management fee revenues | |||||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | |||||
Revenue from contracts with customers | (1) | 0 | (1) | 0 | |
Corporate and other | Other services revenues | |||||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | |||||
Revenue from contracts with customers | 8 | 0 | 8 | 0 | |
Corporate and other | Resort management and other services | |||||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | |||||
Revenue from contracts with customers | 7 | 0 | 7 | 0 | |
Corporate and other | Rental | |||||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | |||||
Revenue from contracts with customers | $ 0 | $ 0 | $ 0 | $ 0 |
REVENUE - Timing of Revenue fro
REVENUE - Timing of Revenue from Contracts with Customers (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | |
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | ||||
Revenue from contracts with customers | $ 702 | $ 496 | $ 1,797 | $ 1,522 |
Vacation Ownership | ||||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | ||||
Revenue from contracts with customers | 661 | 496 | 1,756 | 1,522 |
Exchange & Third-Party Management | ||||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | ||||
Revenue from contracts with customers | 40 | 0 | 40 | 0 |
Services transferred over time | ||||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | ||||
Revenue from contracts with customers | 391 | 278 | 1,034 | 867 |
Services transferred over time | Vacation Ownership | ||||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | ||||
Revenue from contracts with customers | 367 | 278 | 1,010 | 867 |
Services transferred over time | Exchange & Third-Party Management | ||||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | ||||
Revenue from contracts with customers | 23 | 0 | 23 | 0 |
Goods or services transferred at a point in time | ||||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | ||||
Revenue from contracts with customers | 311 | 218 | 763 | 655 |
Goods or services transferred at a point in time | Vacation Ownership | ||||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | ||||
Revenue from contracts with customers | 294 | 218 | 746 | 655 |
Goods or services transferred at a point in time | Exchange & Third-Party Management | ||||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | ||||
Revenue from contracts with customers | 17 | 0 | 17 | 0 |
Corporate and other | ||||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | ||||
Revenue from contracts with customers | 1 | 0 | 1 | 0 |
Corporate and other | Services transferred over time | ||||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | ||||
Revenue from contracts with customers | 1 | 0 | 1 | 0 |
Corporate and other | Goods or services transferred at a point in time | ||||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | ||||
Revenue from contracts with customers | $ 0 | $ 0 | $ 0 | $ 0 |
REVENUE - Contracts with Custom
REVENUE - Contracts with Customers, Assets and Liabilities (Details) - USD ($) $ in Millions | Sep. 30, 2018 | Dec. 31, 2017 |
Receivables | ||
Accounts receivable | $ 46 | $ 73 |
Vacation ownership notes receivable, net | 1,959 | 1,115 |
Receivables | 2,005 | 1,188 |
Contract Liabilities | ||
Contract Liabilities | 449 | 153 |
Advance deposits | ||
Contract Liabilities | ||
Contract Liabilities | 124 | 84 |
Deferred revenue | ||
Contract Liabilities | ||
Contract Liabilities | $ 325 | $ 69 |
REVENUE - Remaining performance
REVENUE - Remaining performance obligation narrative (Details) - Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2018-10-01 | Sep. 30, 2018 |
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | |
Revenue remaining performance obligation expected timing percentage | 90.00% |
Expected timing of satisfaction, period | 2 years |
INCOME TAXES (Details)
INCOME TAXES (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2018 | Sep. 30, 2017 | Dec. 31, 2018 | Dec. 31, 2017 | |
Income Tax Contingency [Line Items] | |||||
Unrecognized tax benefits that, if recognized, would impact the effective tax rate | $ 2 | $ 2 | |||
Effective income tax rate, percent | (177.62%) | 34.76% | |||
Decrease in income tax expense | $ 2 | $ 65 | |||
Decrease net deferred tax liability | $ 65 | ||||
Scenario, Forecast | |||||
Income Tax Contingency [Line Items] | |||||
Effective income tax rate, percent | 45.98% |
VACATION OWNERSHIP NOTES RECE_3
VACATION OWNERSHIP NOTES RECEIVABLE - Composition of Vacation Ownership Notes Receivable Balances, Net of Reserves (Details) - USD ($) $ in Millions | Sep. 30, 2018 | Dec. 31, 2017 |
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Vacation ownership notes receivable, net | $ 1,959 | $ 1,115 |
Securitized | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Vacation ownership notes receivable, net | 1,557 | 814 |
Eligible for securitization | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Vacation ownership notes receivable, net | 143 | 142 |
Not eligible for securitization | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Vacation ownership notes receivable, net | 259 | 159 |
Non-Securitized | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Vacation ownership notes receivable, net | 402 | 301 |
Originated | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Vacation ownership notes receivable, net | 1,254 | 1,115 |
Originated | Securitized | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Vacation ownership notes receivable, net | 990 | 814 |
Originated | Eligible for securitization | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Vacation ownership notes receivable, net | 57 | 142 |
Originated | Not eligible for securitization | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Vacation ownership notes receivable, net | 207 | 159 |
Originated | Non-Securitized | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Vacation ownership notes receivable, net | 264 | 301 |
Acquired | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Vacation ownership notes receivable, net | 705 | 0 |
Acquired | Securitized | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Vacation ownership notes receivable, net | 567 | 0 |
Acquired | Eligible for securitization | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Vacation ownership notes receivable, net | 86 | 0 |
Acquired | Not eligible for securitization | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Vacation ownership notes receivable, net | 52 | 0 |
Acquired | Non-Securitized | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Vacation ownership notes receivable, net | $ 138 | $ 0 |
VACATION OWNERSHIP NOTES RECE_4
VACATION OWNERSHIP NOTES RECEIVABLE - Interest Income Associated With Vacation Ownership Notes Receivable (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||||
Interest income | $ 45 | $ 33 | $ 113 | $ 94 |
Securitized | ||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||||
Interest income | 42 | 27 | 95 | 73 |
Non-Securitized | ||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||||
Interest income | $ 3 | $ 6 | $ 18 | $ 21 |
VACATION OWNERSHIP NOTES RECE_5
VACATION OWNERSHIP NOTES RECEIVABLE - Additional Information (Details) $ in Millions | 9 Months Ended | |
Sep. 30, 2018USD ($)credit_score | Dec. 31, 2017USD ($) | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Vacation ownership notes receivable, net | $ 1,959 | $ 1,115 |
Period in which loan considered past due | 30 days | |
Period in which loan suspend accrual of interest | 90 days | |
Period in which loan considered default loan | 150 days | |
Notes receivable estimated average remaining default rates | 7.07% | 7.16% |
Estimated default rate increases that would have resulted an increase in allowance for credit losses | 0.50% | |
Financing receivable, allowance for credit losses, that would have been increased | $ 7 | $ 6 |
Weighted average FICO score within originated loan pool | credit_score | 709 | |
Average estimated rate of default for all outstanding loans | 13.96% | |
Acquired | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Vacation ownership notes receivable, net | $ 705 | $ 0 |
VACATION OWNERSHIP NOTES RECE_6
VACATION OWNERSHIP NOTES RECEIVABLE - Accretable Yield (Details) - USD ($) $ in Millions | 1 Months Ended | 9 Months Ended | |
Sep. 30, 2018 | Sep. 30, 2018 | Sep. 30, 2017 | |
Certain Loans Acquired in Transfer Not Accounted for as Debt Securities, Accretable Yield Movement Schedule [Roll Forward] | |||
Accretion of acquired vacation ownership notes receivable | $ (1) | $ 0 | |
Acquired | |||
Certain Loans Acquired in Transfer Not Accounted for as Debt Securities, Accretable Yield Movement Schedule [Roll Forward] | |||
Balance at Acquisition Date | $ 0 | ||
Acquired accretable yield | 373 | ||
Accretion of acquired vacation ownership notes receivable | (9) | ||
Reclassification from non-accretable difference | 0 | ||
Balance at September 30, 2018 | 364 | 364 | |
Non-accretable difference at September 30, 2018 | $ 78 | $ 78 |
VACATION OWNERSHIP NOTES RECE_7
VACATION OWNERSHIP NOTES RECEIVABLE - Future Principal Payments, Net of Reserves, and Interest Rates of Vacation Ownership Notes Receivable (Details) $ in Millions | Sep. 30, 2018USD ($) |
Acquired | |
Future Minimum Payments Receivable [Line Items] | |
2018, remaining | $ 20 |
2,019 | 70 |
2,020 | 72 |
2,021 | 74 |
2,022 | 75 |
Thereafter | 394 |
Total Vacation ownership notes receivable, net of reserve | 705 |
Acquired | Non-Securitized Vacation Ownership Notes Receivable | |
Future Minimum Payments Receivable [Line Items] | |
2018, remaining | 5 |
2,019 | 10 |
2,020 | 11 |
2,021 | 12 |
2,022 | 12 |
Thereafter | 88 |
Total Vacation ownership notes receivable, net of reserve | 138 |
Acquired | Securitized Vacation Ownership Notes Receivable | |
Future Minimum Payments Receivable [Line Items] | |
2018, remaining | 15 |
2,019 | 60 |
2,020 | 61 |
2,021 | 62 |
2,022 | 63 |
Thereafter | 306 |
Total Vacation ownership notes receivable, net of reserve | $ 567 |
Acquired | Weighted Average | |
Future Minimum Payments Receivable [Line Items] | |
Interest rates | 13.40% |
Acquired | Weighted Average | Non-Securitized Vacation Ownership Notes Receivable | |
Future Minimum Payments Receivable [Line Items] | |
Interest rates | 13.40% |
Acquired | Weighted Average | Securitized Vacation Ownership Notes Receivable | |
Future Minimum Payments Receivable [Line Items] | |
Interest rates | 13.40% |
Acquired | Minimum | |
Future Minimum Payments Receivable [Line Items] | |
Interest rates | 3.50% |
Acquired | Minimum | Non-Securitized Vacation Ownership Notes Receivable | |
Future Minimum Payments Receivable [Line Items] | |
Interest rates | 3.50% |
Acquired | Minimum | Securitized Vacation Ownership Notes Receivable | |
Future Minimum Payments Receivable [Line Items] | |
Interest rates | 6.00% |
Acquired | Maximum | |
Future Minimum Payments Receivable [Line Items] | |
Interest rates | 17.90% |
Acquired | Maximum | Non-Securitized Vacation Ownership Notes Receivable | |
Future Minimum Payments Receivable [Line Items] | |
Interest rates | 17.90% |
Acquired | Maximum | Securitized Vacation Ownership Notes Receivable | |
Future Minimum Payments Receivable [Line Items] | |
Interest rates | 17.90% |
Originated | |
Future Minimum Payments Receivable [Line Items] | |
2018, remaining | $ 40 |
2,019 | 141 |
2,020 | 135 |
2,021 | 133 |
2,022 | 132 |
Thereafter | 673 |
Total Vacation ownership notes receivable, net of reserve | 1,254 |
Originated | Non-Securitized Vacation Ownership Notes Receivable | |
Future Minimum Payments Receivable [Line Items] | |
2018, remaining | 15 |
2,019 | 42 |
2,020 | 32 |
2,021 | 26 |
2,022 | 23 |
Thereafter | 126 |
Total Vacation ownership notes receivable, net of reserve | 264 |
Originated | Securitized Vacation Ownership Notes Receivable | |
Future Minimum Payments Receivable [Line Items] | |
2018, remaining | 25 |
2,019 | 99 |
2,020 | 103 |
2,021 | 107 |
2,022 | 109 |
Thereafter | 547 |
Total Vacation ownership notes receivable, net of reserve | $ 990 |
Originated | Weighted Average | |
Future Minimum Payments Receivable [Line Items] | |
Interest rates | 12.30% |
Originated | Weighted Average | Non-Securitized Vacation Ownership Notes Receivable | |
Future Minimum Payments Receivable [Line Items] | |
Interest rates | 11.50% |
Originated | Weighted Average | Securitized Vacation Ownership Notes Receivable | |
Future Minimum Payments Receivable [Line Items] | |
Interest rates | 12.50% |
Originated | Minimum | |
Future Minimum Payments Receivable [Line Items] | |
Interest rates | 0.00% |
Originated | Minimum | Non-Securitized Vacation Ownership Notes Receivable | |
Future Minimum Payments Receivable [Line Items] | |
Interest rates | 0.00% |
Originated | Minimum | Securitized Vacation Ownership Notes Receivable | |
Future Minimum Payments Receivable [Line Items] | |
Interest rates | 5.20% |
Originated | Maximum | |
Future Minimum Payments Receivable [Line Items] | |
Interest rates | 18.00% |
Originated | Maximum | Non-Securitized Vacation Ownership Notes Receivable | |
Future Minimum Payments Receivable [Line Items] | |
Interest rates | 18.00% |
Originated | Maximum | Securitized Vacation Ownership Notes Receivable | |
Future Minimum Payments Receivable [Line Items] | |
Interest rates | 17.50% |
VACATION OWNERSHIP NOTES RECE_8
VACATION OWNERSHIP NOTES RECEIVABLE - Notes Receivable Reserves (Details) $ in Millions | 9 Months Ended |
Sep. 30, 2018USD ($) | |
Time Sharing Transactions, Allowance for Uncollectible Accounts [Roll Forward] | |
December 31, 2017 | $ 119 |
Increase in vacation ownership notes receivable reserve | 42 |
Securitizations | 0 |
Clean-up call | 0 |
Write-offs | (31) |
Defaulted vacation ownership notes receivable repurchase activity | 0 |
September 30, 2018 | 130 |
Non-Securitized Vacation Ownership Notes Receivable | |
Time Sharing Transactions, Allowance for Uncollectible Accounts [Roll Forward] | |
December 31, 2017 | 58 |
Increase in vacation ownership notes receivable reserve | 35 |
Securitizations | (30) |
Clean-up call | 2 |
Write-offs | (31) |
Defaulted vacation ownership notes receivable repurchase activity | (23) |
September 30, 2018 | 57 |
Securitized Vacation Ownership Notes Receivable | |
Time Sharing Transactions, Allowance for Uncollectible Accounts [Roll Forward] | |
December 31, 2017 | 61 |
Increase in vacation ownership notes receivable reserve | 7 |
Securitizations | 30 |
Clean-up call | (2) |
Write-offs | 0 |
Defaulted vacation ownership notes receivable repurchase activity | 23 |
September 30, 2018 | $ 73 |
VACATION OWNERSHIP NOTES RECE_9
VACATION OWNERSHIP NOTES RECEIVABLE - Recorded Investment in Non-accrual Notes Receivable that are Ninety Days or More Past Due (Details) - Legacy MVW [Member] - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | Dec. 31, 2017 | |
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||||
Investment in notes receivable on non-accrual status | $ 46 | $ 46 | $ 46 | ||
Average investment in notes receivable on non-accrual status | 46 | $ 46 | 46 | $ 48 | |
Non-Securitized Vacation Ownership Notes Receivable | |||||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||||
Investment in notes receivable on non-accrual status | 40 | 40 | 39 | ||
Average investment in notes receivable on non-accrual status | 40 | 40 | 39 | 42 | |
Securitized Vacation Ownership Notes Receivable | |||||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||||
Investment in notes receivable on non-accrual status | 6 | 6 | $ 7 | ||
Average investment in notes receivable on non-accrual status | $ 6 | $ 6 | $ 7 | $ 6 |
VACATION OWNERSHIP NOTES REC_10
VACATION OWNERSHIP NOTES RECEIVABLE - Aging of Recorded Investment in Principal, Vacation Ownership Notes Receivable (Details) - Legacy MVW [Member] - USD ($) $ in Millions | Sep. 30, 2018 | Dec. 31, 2017 |
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total past due | $ 69 | $ 72 |
Current | 1,277 | 1,162 |
Total vacation ownership notes receivable | 1,346 | 1,234 |
Non-Securitized Vacation Ownership Notes Receivable | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total past due | 45 | 46 |
Current | 238 | 313 |
Total vacation ownership notes receivable | 283 | 359 |
Securitized Vacation Ownership Notes Receivable | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total past due | 24 | 26 |
Current | 1,039 | 849 |
Total vacation ownership notes receivable | 1,063 | 875 |
31 – 90 days past due | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total past due | 23 | 26 |
31 – 90 days past due | Non-Securitized Vacation Ownership Notes Receivable | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total past due | 5 | 7 |
31 – 90 days past due | Securitized Vacation Ownership Notes Receivable | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total past due | 18 | 19 |
91 – 150 days past due | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total past due | 10 | 12 |
91 – 150 days past due | Non-Securitized Vacation Ownership Notes Receivable | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total past due | 4 | 5 |
91 – 150 days past due | Securitized Vacation Ownership Notes Receivable | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total past due | 6 | 7 |
Greater than 150 days past due | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total past due | 36 | 34 |
Greater than 150 days past due | Non-Securitized Vacation Ownership Notes Receivable | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total past due | 36 | 34 |
Greater than 150 days past due | Securitized Vacation Ownership Notes Receivable | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Total past due | $ 0 | $ 0 |
VACATION OWNERSHIP NOTES REC_11
VACATION OWNERSHIP NOTES RECEIVABLE - Legacy-ILG Vacation Ownership Notes Receivable, Brand and FICO score (Details) $ in Millions | Sep. 30, 2018USD ($) |
Acquired | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | |
Vacation notes receivable | $ 705 |
Acquired | Westin | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | |
Vacation notes receivable | 291 |
Acquired | Sheraton | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | |
Vacation notes receivable | 369 |
Acquired | Hyatt | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | |
Vacation notes receivable | 37 |
Acquired | Other | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | |
Vacation notes receivable | 8 |
Acquired | 700 | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | |
Vacation notes receivable | 352 |
Acquired | 700 | Westin | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | |
Vacation notes receivable | 174 |
Acquired | 700 | Sheraton | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | |
Vacation notes receivable | 156 |
Acquired | 700 | Hyatt | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | |
Vacation notes receivable | 22 |
Acquired | 700 | Other | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | |
Vacation notes receivable | 0 |
Acquired | 600 - 699 | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | |
Vacation notes receivable | 232 |
Acquired | 600 - 699 | Westin | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | |
Vacation notes receivable | 86 |
Acquired | 600 - 699 | Sheraton | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | |
Vacation notes receivable | 133 |
Acquired | 600 - 699 | Hyatt | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | |
Vacation notes receivable | 13 |
Acquired | 600 - 699 | Other | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | |
Vacation notes receivable | 0 |
Acquired | 600 | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | |
Vacation notes receivable | 30 |
Acquired | 600 | Westin | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | |
Vacation notes receivable | 7 |
Acquired | 600 | Sheraton | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | |
Vacation notes receivable | 22 |
Acquired | 600 | Hyatt | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | |
Vacation notes receivable | 1 |
Acquired | 600 | Other | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | |
Vacation notes receivable | 0 |
Acquired | No Score | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | |
Vacation notes receivable | 91 |
Acquired | No Score | Westin | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | |
Vacation notes receivable | 24 |
Acquired | No Score | Sheraton | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | |
Vacation notes receivable | 58 |
Acquired | No Score | Hyatt | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | |
Vacation notes receivable | 1 |
Acquired | No Score | Other | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | |
Vacation notes receivable | 8 |
Legacy ILG [Member] | Originated | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | |
Vacation notes receivable | 38 |
Legacy ILG [Member] | Originated | Westin | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | |
Vacation notes receivable | 19 |
Legacy ILG [Member] | Originated | Sheraton | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | |
Vacation notes receivable | 17 |
Legacy ILG [Member] | Originated | Hyatt | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | |
Vacation notes receivable | 2 |
Legacy ILG [Member] | Originated | 700 | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | |
Vacation notes receivable | 21 |
Legacy ILG [Member] | Originated | 700 | Westin | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | |
Vacation notes receivable | 13 |
Legacy ILG [Member] | Originated | 700 | Sheraton | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | |
Vacation notes receivable | 7 |
Legacy ILG [Member] | Originated | 700 | Hyatt | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | |
Vacation notes receivable | 1 |
Legacy ILG [Member] | Originated | 600 - 699 | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | |
Vacation notes receivable | 9 |
Legacy ILG [Member] | Originated | 600 - 699 | Westin | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | |
Vacation notes receivable | 3 |
Legacy ILG [Member] | Originated | 600 - 699 | Sheraton | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | |
Vacation notes receivable | 5 |
Legacy ILG [Member] | Originated | 600 - 699 | Hyatt | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | |
Vacation notes receivable | 1 |
Legacy ILG [Member] | Originated | 600 | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | |
Vacation notes receivable | 3 |
Legacy ILG [Member] | Originated | 600 | Westin | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | |
Vacation notes receivable | 1 |
Legacy ILG [Member] | Originated | 600 | Sheraton | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | |
Vacation notes receivable | 2 |
Legacy ILG [Member] | Originated | 600 | Hyatt | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | |
Vacation notes receivable | 0 |
Legacy ILG [Member] | Originated | No Score | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | |
Vacation notes receivable | 5 |
Legacy ILG [Member] | Originated | No Score | Westin | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | |
Vacation notes receivable | 2 |
Legacy ILG [Member] | Originated | No Score | Sheraton | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | |
Vacation notes receivable | 3 |
Legacy ILG [Member] | Originated | No Score | Hyatt | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | |
Vacation notes receivable | $ 0 |
VACATION OWNERSHIP NOTES REC_12
VACATION OWNERSHIP NOTES RECEIVABLE - Legacy-ILG Vacation Ownership Notes Receivable (Details) - Legacy ILG [Member] - Originated - ILG $ in Millions | Sep. 30, 2018USD ($) |
Accounts, Notes, Loans and Financing Receivable [Line Items] | |
Receivables | $ 38 |
Current | 38 |
Delinquent & Defaulted | 0 |
30-59 Days | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | |
Delinquent & Defaulted | 0 |
60-89 Days | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | |
Delinquent & Defaulted | 0 |
90-119 Days | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | |
Delinquent & Defaulted | 0 |
Greater than 120 Days | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | |
Delinquent & Defaulted | $ 0 |
FINANCIAL INSTRUMENTS - Carryin
FINANCIAL INSTRUMENTS - Carrying Values and Estimated Fair Values (Details) - USD ($) $ in Millions | Sep. 30, 2018 | Dec. 31, 2017 |
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Vacation ownership notes receivable, net | $ 1,959 | $ 1,115 |
Other | 268 | 166 |
Securitized debt | (835) | |
Debt, net | (2,235) | (260) |
Debt, gross | (2,291) | |
Carrying Amount | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Other | 51 | 14 |
Total financial assets | 1,305 | 1,129 |
Debt, net | (2,235) | (260) |
Total financial liabilities | (3,915) | (1,088) |
Fair Value | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Other | 51 | 14 |
Total financial assets | 1,446 | 1,290 |
Total financial liabilities | (3,982) | (1,157) |
Securitized | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Vacation ownership notes receivable, net | 1,557 | 814 |
Non-Securitized | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Vacation ownership notes receivable, net | 402 | 301 |
Debt | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Securitized debt | (1,688) | |
Debt | Carrying Amount | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Securitized debt | (1,688) | (835) |
Debt | Fair Value | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Securitized debt | (1,683) | (836) |
Other debt, net | Carrying Amount | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Debt, net | (19) | 0 |
Debt, gross | (19) | 0 |
Other debt, net | Fair Value | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Debt, net | (19) | 0 |
Senior Unsecured Notes | Senior Notes | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Debt, gross | (750) | |
Senior Unsecured Notes | Senior Notes | Carrying Amount | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Debt, net | (741) | 0 |
Debt, gross | (750) | 0 |
Senior Unsecured Notes | Senior Notes | Fair Value | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Debt, net | (772) | 0 |
Exchange Notes, net | Senior Notes | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Debt, gross | (89) | |
Exchange Notes, net | Senior Notes | Carrying Amount | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Debt, net | (88) | 0 |
Debt, gross | (89) | 0 |
Exchange Notes, net | Senior Notes | Fair Value | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Debt, net | (89) | 0 |
IAC Notes | Senior Notes | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Debt, gross | (264) | |
IAC Notes | Senior Notes | Carrying Amount | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Debt, gross | (264) | 0 |
IAC Notes | Senior Notes | Fair Value | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Debt, gross | (264) | 0 |
Convertible Notes | Senior Notes | Carrying Amount | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Debt, net | (198) | (192) |
Convertible Notes | Senior Notes | Fair Value | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Debt, net | (238) | (260) |
Non-Interest Bearing Note Payable | Non-interest bearing note payable, net | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Debt, gross | (31) | |
Non-Interest Bearing Note Payable | Non-interest bearing note payable, net | Carrying Amount | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Debt, net | (30) | (61) |
Debt, gross | (31) | (64) |
Non-Interest Bearing Note Payable | Non-interest bearing note payable, net | Fair Value | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Debt, net | (30) | (61) |
Acquired | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Vacation ownership notes receivable, net | 705 | 0 |
Acquired | Securitized | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Vacation ownership notes receivable, net | 567 | 0 |
Acquired | Non-Securitized | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Vacation ownership notes receivable, net | 138 | 0 |
Originated | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Vacation ownership notes receivable, net | 1,254 | 1,115 |
Originated | Carrying Amount | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Vacation ownership notes receivable, net | 1,254 | 1,115 |
Originated | Fair Value | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Vacation ownership notes receivable, net | 1,395 | 1,276 |
Originated | Securitized | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Vacation ownership notes receivable, net | 990 | 814 |
Originated | Securitized | Carrying Amount | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Vacation ownership notes receivable, net | 990 | 814 |
Originated | Securitized | Fair Value | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Vacation ownership notes receivable, net | 1,124 | 955 |
Originated | Non-Securitized | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Vacation ownership notes receivable, net | 264 | 301 |
Originated | Non-Securitized | Carrying Amount | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Vacation ownership notes receivable, net | 264 | 301 |
Originated | Non-Securitized | Fair Value | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Vacation ownership notes receivable, net | 271 | 321 |
Corporate Credit Facility | Term Loan | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Debt, net | (887) | 0 |
Debt, gross | (900) | 0 |
Corporate Credit Facility | Term Loan | Carrying Amount | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Debt, net | (887) | 0 |
Corporate Credit Facility | Term Loan | Fair Value | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Debt, net | $ (887) | $ 0 |
FINANCIAL INSTRUMENTS - Carry_2
FINANCIAL INSTRUMENTS - Carrying Values and Estimated Fair Values - Non-securitized Notes Receivable (Details) - USD ($) $ in Millions | Sep. 30, 2018 | Dec. 31, 2017 |
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Vacation ownership notes receivable, net | $ 1,959 | $ 1,115 |
Securitized Vacation Ownership Notes Receivable | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Vacation ownership notes receivable, net | 1,557 | 814 |
Non-Securitized Vacation Ownership Notes Receivable | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Vacation ownership notes receivable, net | 402 | 301 |
Acquired | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Vacation ownership notes receivable, net | 705 | 0 |
Acquired | Securitized Vacation Ownership Notes Receivable | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Vacation ownership notes receivable, net | 567 | 0 |
Acquired | Non-Securitized Vacation Ownership Notes Receivable | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Vacation ownership notes receivable, net | 138 | 0 |
Originated | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Vacation ownership notes receivable, net | 1,254 | 1,115 |
Originated | Carrying Amount | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Vacation ownership notes receivable, net | 1,254 | 1,115 |
Originated | Fair Value | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Vacation ownership notes receivable, net | 1,395 | 1,276 |
Originated | Securitized Vacation Ownership Notes Receivable | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Vacation ownership notes receivable, net | 990 | 814 |
Originated | Securitized Vacation Ownership Notes Receivable | Carrying Amount | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Vacation ownership notes receivable, net | 990 | 814 |
Originated | Securitized Vacation Ownership Notes Receivable | Fair Value | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Vacation ownership notes receivable, net | 1,124 | 955 |
Originated | Non-Securitized Vacation Ownership Notes Receivable | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Vacation ownership notes receivable, net | 264 | 301 |
Originated | Non-Securitized Vacation Ownership Notes Receivable | Carrying Amount | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Vacation ownership notes receivable, net | 264 | 301 |
Originated | Non-Securitized Vacation Ownership Notes Receivable | Fair Value | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Vacation ownership notes receivable, net | 271 | 321 |
Originated | Non-Securitized Vacation Ownership Notes Receivable | Eligible for securitization | Carrying Amount | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Vacation ownership notes receivable, net | 57 | 142 |
Originated | Non-Securitized Vacation Ownership Notes Receivable | Eligible for securitization | Fair Value | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Vacation ownership notes receivable, net | 64 | 162 |
Originated | Non-Securitized Vacation Ownership Notes Receivable | Not eligible for securitization | Carrying Amount | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Vacation ownership notes receivable, net | 207 | 159 |
Originated | Non-Securitized Vacation Ownership Notes Receivable | Not eligible for securitization | Fair Value | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Vacation ownership notes receivable, net | $ 207 | $ 159 |
FINANCIAL INSTRUMENTS - Narrati
FINANCIAL INSTRUMENTS - Narrative (Details) $ in Millions | Sep. 30, 2018USD ($) |
Investments, All Other Investments [Abstract] | |
Marketable securities | $ 8 |
Notes receivable | $ 15 |
EARNINGS PER SHARE - Additional
EARNINGS PER SHARE - Additional Information (Details) - $ / shares shares in Thousands | 9 Months Ended | |
Sep. 30, 2017 | Sep. 30, 2018 | |
Performance Shares | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Shares excluded from the calculation of diluted earnings per share (in shares) | 289 | |
Private Warrants | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Exercise price of warrants (in usd per share) | $ 176.68 | $ 176.40 |
EARNINGS PER SHARE - Reconcilia
EARNINGS PER SHARE - Reconciliation of Earnings Per Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Millions | 1 Months Ended | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||||
Net (loss) income attributable to common shareholders | $ (68) | $ (58) | $ 40 | $ (11) | $ 116 |
Shares for basic (loss) earnings per share (in shares) | 32,800 | 27,100 | 28,800 | 27,200 | |
Basic (loss) earnings per share (in usd per share) | $ (1.75) | $ 1.49 | $ (0.37) | $ 4.27 | |
Employee stock options and SARs (in shares) | 0 | 400 | 0 | 500 | |
Restricted stock units (in shares) | 0 | 200 | 0 | 200 | |
Shares for diluted earnings per share (in shares) | 32,800 | 27,700 | 28,800 | 27,900 | |
Diluted (loss) earnings per share (in usd per share) | $ (1.75) | $ 1.45 | $ (0.37) | $ 4.18 | |
Performance Shares | |||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||||
Shares excluded from the calculation of diluted earnings per share (in shares) | 289 |
INVENTORY - Composition of Inve
INVENTORY - Composition of Inventory (Details) - USD ($) $ in Millions | Sep. 30, 2018 | Dec. 31, 2017 |
Inventory Disclosure [Abstract] | ||
Finished goods | $ 761 | $ 391 |
Work-in-progress | 55 | 2 |
Real estate inventory | 816 | 393 |
Operating supplies and retail inventory | 13 | 5 |
Inventory | $ 829 | $ 398 |
INVENTORY - Additional Informat
INVENTORY - Additional Information (Details) $ in Millions | Sep. 30, 2018USD ($) |
Inventory Disclosure [Abstract] | |
Amount of completed vacation ownership units classified as property and equipment | $ 45 |
CONTINGENCIES AND COMMITMENTS (
CONTINGENCIES AND COMMITMENTS (Details) $ in Millions | Mar. 31, 2017Plaintiff | Jul. 01, 2013Plaintiff | Jul. 31, 2018claim | Jun. 30, 2018USD ($) | Jun. 30, 2013Plaintiff | Apr. 30, 2013Plaintiff | Sep. 30, 2018USD ($)vacation_ownership_unit | Jun. 30, 2018USD ($) | Sep. 30, 2017USD ($) | Sep. 30, 2018USD ($)vacation_ownership_unit | Sep. 30, 2017USD ($) | Dec. 30, 2016Plaintiff |
Commitments and Contingencies Disclosure [Line Items] | ||||||||||||
Commitments to subsidize associations | $ 6 | $ 6 | ||||||||||
Surety bonds issued | 74 | 74 | ||||||||||
Letters of credit outstanding | 3 | 3 | ||||||||||
Guarantor obligations, maximum exposure, Undiscounted | 45 | 45 | ||||||||||
Litigation settlement | 17 | $ 2 | 33 | $ 2 | ||||||||
Estimate of possible loss | $ 10 | |||||||||||
Recovery of funds | 3 | $ 3 | 6 | |||||||||
Amount recorded in Gains (losses) and other income (expense) | (2) | $ (7) | 4 | $ (7) | ||||||||
Kapalua Bay Settlement | ||||||||||||
Commitments and Contingencies Disclosure [Line Items] | ||||||||||||
Number of plaintiffs in lawsuits | Plaintiff | 2 | 38 | 12 | |||||||||
Number of plaintiffs, released claims | Plaintiff | 2 | 2 | ||||||||||
Litigation settlement | 16 | |||||||||||
RCC-Aspen Highlands | ||||||||||||
Commitments and Contingencies Disclosure [Line Items] | ||||||||||||
Number of plaintiffs in lawsuits | Plaintiff | 232 | |||||||||||
Fifth and Fifty-Fifth Residence Club | ||||||||||||
Commitments and Contingencies Disclosure [Line Items] | ||||||||||||
Number of plaintiffs in lawsuits | Plaintiff | 107 | |||||||||||
Acquisition of ILG | ||||||||||||
Commitments and Contingencies Disclosure [Line Items] | ||||||||||||
New claims filed | claim | 2 | |||||||||||
Fraudulently Induced Electronic Payment Disbursements | ||||||||||||
Commitments and Contingencies Disclosure [Line Items] | ||||||||||||
Amount recorded in Gains (losses) and other income (expense) | (3) | 4 | ||||||||||
North America | Settled Litigation | William and Sharon Petrick Case | ||||||||||||
Commitments and Contingencies Disclosure [Line Items] | ||||||||||||
Litigation settlement | 11 | |||||||||||
North America | Settled Litigation | The Ritz-Carlton, Lake Tahoe | ||||||||||||
Commitments and Contingencies Disclosure [Line Items] | ||||||||||||
Litigation settlement | 5 | |||||||||||
Europe | Settled Litigation | ||||||||||||
Commitments and Contingencies Disclosure [Line Items] | ||||||||||||
Litigation settlement | $ 1 | |||||||||||
Revolving corporate credit facility, net | ||||||||||||
Commitments and Contingencies Disclosure [Line Items] | ||||||||||||
Letters of credit outstanding | 6 | 6 | ||||||||||
Commitment to purchase vacation ownership units located in Marco Island, Florida | ||||||||||||
Commitments and Contingencies Disclosure [Line Items] | ||||||||||||
Purchase commitment obligation due, 2019 | 85 | 85 | ||||||||||
New York City, New York | ||||||||||||
Commitments and Contingencies Disclosure [Line Items] | ||||||||||||
Purchase commitment | 170 | 170 | ||||||||||
Purchase commitment obligation due, 2019 | 108 | 108 | ||||||||||
Purchase commitment obligation due, 2020 | 62 | 62 | ||||||||||
Bali Indonesia Resort Two | ||||||||||||
Commitments and Contingencies Disclosure [Line Items] | ||||||||||||
Purchase commitment obligation due, 2018 | 4 | 4 | ||||||||||
Purchase commitment obligation due, 2019 | 31 | 31 | ||||||||||
Purchase commitment obligation due, 2020 | $ 2 | $ 2 | ||||||||||
Number of vacation ownership units expected to be acquired | vacation_ownership_unit | 88 | 88 | ||||||||||
San Francisco, California | ||||||||||||
Commitments and Contingencies Disclosure [Line Items] | ||||||||||||
Purchase commitment | $ 164 | $ 164 | ||||||||||
Purchase commitment obligation due, 2020 | 100 | 100 | ||||||||||
Purchase commitment obligation due, 2021 | 64 | 64 | ||||||||||
Facility And Other Operating Leases | New York City, New York | ||||||||||||
Commitments and Contingencies Disclosure [Line Items] | ||||||||||||
Capital leases, future minimum payments due | 7 | 7 | ||||||||||
Information technology hardware and software | ||||||||||||
Commitments and Contingencies Disclosure [Line Items] | ||||||||||||
Purchase commitment | 46 | 46 | ||||||||||
Purchase commitment obligation due, 2018 | 8 | 8 | ||||||||||
Purchase commitment obligation due, 2019 | 20 | 20 | ||||||||||
Purchase commitment obligation due, 2020 | 9 | 9 | ||||||||||
Purchase commitment obligation due, 2021 | 4 | 4 | ||||||||||
Purchase commitment obligation due, 2022 | 3 | 3 | ||||||||||
Purchase commitment obligation due, thereafter | 2 | 2 | ||||||||||
Insurance Claim, Hurricane Irma | ||||||||||||
Commitments and Contingencies Disclosure [Line Items] | ||||||||||||
Insurance claim receivable | $ 10 | $ 10 |
SECURITIZED DEBT - Vacation Own
SECURITIZED DEBT - Vacation Ownership Notes Receivable Securitizations (Details) - USD ($) $ in Millions | Sep. 30, 2018 | Dec. 31, 2017 |
Debt Instrument [Line Items] | ||
Securitized debt, net | $ 835 | |
Variable Interest Entity | ||
Debt Instrument [Line Items] | ||
Securitized debt, net | $ 1,701 | 845 |
Variable Interest Entity | Debt | ||
Debt Instrument [Line Items] | ||
Securitized debt, net | 1,688 | 835 |
Legacy MVW [Member] | Variable Interest Entity | Debt | ||
Debt Instrument [Line Items] | ||
Securitized debt, net | 1,034 | 845 |
Unamortized debt issuance costs | (13) | (10) |
Secured Debt, Net | $ 1,021 | 835 |
Debt, weighted average interest rate | 2.90% | |
Legacy MVW [Member] | Variable Interest Entity | Debt | Minimum | ||
Debt Instrument [Line Items] | ||
Debt, stated interest rate | 2.20% | |
Legacy MVW [Member] | Variable Interest Entity | Debt | Maximum | ||
Debt Instrument [Line Items] | ||
Debt, stated interest rate | 6.30% | |
Legacy ILG [Member] | Variable Interest Entity | Debt | ||
Debt Instrument [Line Items] | ||
Securitized debt, net | $ 667 | $ 0 |
Debt, weighted average interest rate | 2.90% | |
Legacy ILG [Member] | Variable Interest Entity | Debt | Minimum | ||
Debt Instrument [Line Items] | ||
Debt, stated interest rate | 2.30% | |
Legacy ILG [Member] | Variable Interest Entity | Debt | Maximum | ||
Debt Instrument [Line Items] | ||
Debt, stated interest rate | 4.00% |
SECURITIZED DEBT - Narrative (D
SECURITIZED DEBT - Narrative (Details) | Oct. 19, 2018USD ($) | Jun. 28, 2018USD ($) | Aug. 31, 2018USD ($) | Sep. 30, 2018USD ($)Loan | Sep. 30, 2018USD ($)Loan | Sep. 30, 2017USD ($) | Dec. 31, 2017USD ($) |
Debt Instrument [Line Items] | |||||||
Borrowings from securitization transactions | $ 423,000,000 | $ 400,000,000 | |||||
Restricted cash | $ 365,000,000 | $ 365,000,000 | $ 82,000,000 | ||||
Number of notes receivable pools under performance triggers | Loan | 0 | ||||||
Number of notes receivable pools outstanding | Loan | 11 | 11 | |||||
2018-A Trust | |||||||
Debt Instrument [Line Items] | |||||||
Values of vacation ownership notes receivable that were securitized during the period | $ 293,000,000 | ||||||
Warehouse Credit Facility | |||||||
Debt Instrument [Line Items] | |||||||
Credit facility | $ 250,000,000 | $ 250,000,000 | |||||
Period of time that amounts outstanding are due upon termination of facility | 13 months | ||||||
Line of credit | 0 | $ 0 | |||||
Variable Interest Entity | |||||||
Debt Instrument [Line Items] | |||||||
Restricted cash | $ 130,000,000 | $ 130,000,000 | $ 32,000,000 | ||||
Legacy ILG [Member] | 2018-A Trust | Secured Debt [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Values of vacation ownership notes receivable that were securitized during the period | 221,000,000 | ||||||
Proceeds from vacation ownership notes receivable securitizations | 287,000,000 | ||||||
Debt, weighted average interest rate | 3.63% | 3.63% | |||||
Legacy ILG [Member] | 2018-A Trust | Secured Debt [Member] | Class A Notes | |||||||
Debt Instrument [Line Items] | |||||||
Principal amount | 209,000,000 | ||||||
Debt, stated interest rate | 3.56% | 3.56% | |||||
Legacy ILG [Member] | 2018-A Trust | Secured Debt [Member] | Class B Notes | |||||||
Debt Instrument [Line Items] | |||||||
Principal amount | 49,000,000 | ||||||
Debt, stated interest rate | 3.72% | 3.72% | |||||
Legacy ILG [Member] | 2018-A Trust | Secured Debt [Member] | Class C Notes | |||||||
Debt Instrument [Line Items] | |||||||
Principal amount | $ 29,000,000 | ||||||
Debt, stated interest rate | 4.02% | 4.02% | |||||
Legacy ILG [Member] | Subsequent Event | 2018-A Trust | |||||||
Debt Instrument [Line Items] | |||||||
Values of vacation ownership notes receivable that were securitized during the period | $ 23,000,000 | ||||||
Decrease in restricted cash | $ 23,000,000 | ||||||
Legacy ILG [Member] | Variable Interest Entity | Secured Debt [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Debt, weighted average interest rate | 2.90% | 2.90% | |||||
Legacy MVW [Member] | Mvw Holding | |||||||
Debt Instrument [Line Items] | |||||||
Values of vacation ownership notes receivable that were securitized during the period | $ 436,000,000 | ||||||
Legacy MVW [Member] | Mvw Holding | Debt | |||||||
Debt Instrument [Line Items] | |||||||
Values of vacation ownership notes receivable that were securitized during the period | 327,000,000 | $ 109,000,000 | |||||
Borrowings from securitization transactions | 317,000,000 | ||||||
Proceeds from vacation ownership notes receivable securitizations | $ 423,000,000 | ||||||
Debt, weighted average interest rate | 3.52% | ||||||
Legacy MVW [Member] | Mvw Holding | Debt | Class A Notes | |||||||
Debt Instrument [Line Items] | |||||||
Principal amount | $ 316,000,000 | ||||||
Debt, stated interest rate | 3.45% | ||||||
Legacy MVW [Member] | Mvw Holding | Debt | Class B Notes | |||||||
Debt Instrument [Line Items] | |||||||
Principal amount | $ 65,000,000 | ||||||
Debt, stated interest rate | 3.60% | ||||||
Legacy MVW [Member] | Mvw Holding | Debt | Class C Notes | |||||||
Debt Instrument [Line Items] | |||||||
Principal amount | $ 42,000,000 | ||||||
Debt, stated interest rate | 3.90% | ||||||
Legacy MVW [Member] | 2018-01 Trust | |||||||
Debt Instrument [Line Items] | |||||||
Decrease in restricted cash | $ 106,000,000 | ||||||
Legacy MVW [Member] | Variable Interest Entity | Secured Debt [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Debt, weighted average interest rate | 2.90% | 2.90% |
SECURITIZED DEBT - Future Payme
SECURITIZED DEBT - Future Payments Vacation Ownership Notes Receivable Securitizations (Details) $ in Millions | Sep. 30, 2018USD ($) |
Debt Instrument [Line Items] | |
2018, remaining | $ 1 |
2,019 | 49 |
2,020 | 11 |
2,021 | 11 |
2,022 | 241 |
Thereafter | 1,978 |
Variable Interest Entity | Debt | |
Debt Instrument [Line Items] | |
2018, remaining | 69 |
2,019 | 263 |
2,020 | 226 |
2,021 | 203 |
2,022 | 185 |
Thereafter | 755 |
Net carrying amount of the liability component | 1,701 |
Legacy ILG [Member] | Variable Interest Entity | Debt | |
Debt Instrument [Line Items] | |
2018, remaining | 43 |
2,019 | 161 |
2,020 | 120 |
2,021 | 93 |
2,022 | 72 |
Thereafter | 178 |
Net carrying amount of the liability component | 667 |
Legacy MVW [Member] | Variable Interest Entity | Debt | |
Debt Instrument [Line Items] | |
2018, remaining | 26 |
2,019 | 102 |
2,020 | 106 |
2,021 | 110 |
2,022 | 113 |
Thereafter | 577 |
Net carrying amount of the liability component | $ 1,034 |
DEBT - Debt Balances, Net of Un
DEBT - Debt Balances, Net of Unamortized Debt Issuance Costs (Details) - USD ($) | Sep. 30, 2018 | Sep. 04, 2018 | Aug. 31, 2018 | Dec. 31, 2017 | Sep. 30, 2017 |
Debt Instrument [Line Items] | |||||
Debt, gross | $ 2,291,000,000 | ||||
Debt, net | 2,235,000,000 | $ 260,000,000 | |||
Carrying Amount | |||||
Debt Instrument [Line Items] | |||||
Debt, net | 2,235,000,000 | 260,000,000 | |||
Capital leases | 8,000,000 | 7,000,000 | |||
Other debt, net | Carrying Amount | |||||
Debt Instrument [Line Items] | |||||
Debt, gross | 19,000,000 | 0 | |||
Debt, net | 19,000,000 | 0 | |||
Exchange Notes, net | Senior Notes | |||||
Debt Instrument [Line Items] | |||||
Debt, gross | $ 89,000,000 | ||||
Debt, stated interest rate | 5.625% | ||||
Principal amount | $ 88,000,000 | $ 88,000,000 | |||
Exchange Notes, net | Senior Notes | Carrying Amount | |||||
Debt Instrument [Line Items] | |||||
Debt, gross | 89,000,000 | 0 | |||
Unamortized debt issuance costs | (1,000,000) | 0 | |||
Debt, net | 88,000,000 | 0 | |||
Senior Unsecured Notes | Senior Notes | |||||
Debt Instrument [Line Items] | |||||
Debt, gross | $ 750,000,000 | ||||
Debt, stated interest rate | 6.50% | ||||
Principal amount | $ 750,000,000 | ||||
Senior Unsecured Notes | Senior Notes | Carrying Amount | |||||
Debt Instrument [Line Items] | |||||
Debt, gross | 750,000,000 | 0 | |||
Unamortized debt issuance costs | (9,000,000) | 0 | |||
Debt, net | 741,000,000 | 0 | |||
IAC Notes | Senior Notes | |||||
Debt Instrument [Line Items] | |||||
Debt, gross | $ 264,000,000 | ||||
Debt, stated interest rate | 5.625% | 5.625% | |||
Principal amount | $ 262,000,000 | $ 88,000,000 | $ 350,000,000 | ||
IAC Notes | Senior Notes | Carrying Amount | |||||
Debt Instrument [Line Items] | |||||
Debt, gross | 264,000,000 | 0 | |||
Convertible Notes | Senior Notes | Carrying Amount | |||||
Debt Instrument [Line Items] | |||||
Debt, net | 198,000,000 | 192,000,000 | |||
Convertible Notes | Convertible Debt | |||||
Debt Instrument [Line Items] | |||||
Debt, gross | 230,000,000 | ||||
Unamortized debt issuance costs | (5,000,000) | (6,000,000) | |||
Unamortized discount | $ (27,000,000) | (32,000,000) | |||
Debt, stated interest rate | 1.50% | ||||
Principal amount | $ 230,000,000 | ||||
Effective percentage | 4.70% | ||||
Convertible Notes | Convertible Debt | Carrying Amount | |||||
Debt Instrument [Line Items] | |||||
Debt, gross | $ 230,000,000 | 230,000,000 | |||
Unamortized debt discount and issuance costs | (32,000,000) | (38,000,000) | |||
Debt, net | 198,000,000 | 192,000,000 | |||
Non-Interest Bearing Note Payable | Non-interest bearing note payable, net | |||||
Debt Instrument [Line Items] | |||||
Debt, gross | $ 31,000,000 | ||||
Effective percentage | 6.00% | ||||
Non-Interest Bearing Note Payable | Non-interest bearing note payable, net | Carrying Amount | |||||
Debt Instrument [Line Items] | |||||
Debt, gross | $ 31,000,000 | 64,000,000 | |||
Unamortized discount | (1,000,000) | (3,000,000) | |||
Debt, net | 30,000,000 | 61,000,000 | |||
Corporate Credit Facility | Term Loan | |||||
Debt Instrument [Line Items] | |||||
Debt, gross | 900,000,000 | 0 | |||
Unamortized debt discount and issuance costs | (13,000,000) | 0 | |||
Debt, net | 887,000,000 | 0 | |||
Corporate Credit Facility | Term Loan | Carrying Amount | |||||
Debt Instrument [Line Items] | |||||
Debt, net | $ 887,000,000 | $ 0 |
DEBT - Scheduled Future Princip
DEBT - Scheduled Future Principal Payments for Debt (Details) - USD ($) $ in Millions | Sep. 30, 2018 | Dec. 31, 2017 |
Long Term Debt Maturities Repayments Of Principal [Line Items] | ||
2018, remaining | $ 1 | |
2,019 | 49 | |
2,020 | 11 | |
2,021 | 11 | |
2,022 | 241 | |
Thereafter | 1,978 | |
Total principal payments | 2,291 | |
Senior Notes | Exchange Notes, net | ||
Long Term Debt Maturities Repayments Of Principal [Line Items] | ||
2018, remaining | 0 | |
2,019 | 0 | |
2,020 | 0 | |
2,021 | 0 | |
2,022 | 0 | |
Thereafter | 89 | |
Total principal payments | 89 | |
Senior Notes | Senior Unsecured Notes | ||
Long Term Debt Maturities Repayments Of Principal [Line Items] | ||
2018, remaining | 0 | |
2,019 | 0 | |
2,020 | 0 | |
2,021 | 0 | |
2,022 | 0 | |
Thereafter | 750 | |
Total principal payments | 750 | |
Senior Notes | IAC Notes | ||
Long Term Debt Maturities Repayments Of Principal [Line Items] | ||
2018, remaining | 0 | |
2,019 | 0 | |
2,020 | 0 | |
2,021 | 0 | |
2,022 | 0 | |
Thereafter | 264 | |
Total principal payments | 264 | |
Convertible Debt | Convertible Notes | ||
Long Term Debt Maturities Repayments Of Principal [Line Items] | ||
2018, remaining | 0 | |
2,019 | 0 | |
2,020 | 0 | |
2,021 | 0 | |
2,022 | 230 | |
Thereafter | 0 | |
Total principal payments | 230 | |
Convertible Debt | Other debt, net | ||
Long Term Debt Maturities Repayments Of Principal [Line Items] | ||
2018, remaining | 1 | |
2,019 | 1 | |
2,020 | 2 | |
2,021 | 2 | |
2,022 | 2 | |
Thereafter | 11 | |
Total principal payments | 19 | |
Non-interest bearing note payable, net | Non-Interest Bearing Note Payable | ||
Long Term Debt Maturities Repayments Of Principal [Line Items] | ||
2018, remaining | 0 | |
2,019 | 31 | |
2,020 | 0 | |
2,021 | 0 | |
2,022 | 0 | |
Thereafter | 0 | |
Total principal payments | 31 | |
Capital Leases | ||
Long Term Debt Maturities Repayments Of Principal [Line Items] | ||
2018, remaining | 0 | |
2,019 | 8 | |
2,020 | 0 | |
2,021 | 0 | |
2,022 | 0 | |
Thereafter | 0 | |
Total principal payments | 8 | |
Corporate Credit Facility | Term Loan | ||
Long Term Debt Maturities Repayments Of Principal [Line Items] | ||
2018, remaining | 0 | |
2,019 | 9 | |
2,020 | 9 | |
2,021 | 9 | |
2,022 | 9 | |
Thereafter | 864 | |
Total principal payments | $ 900 | $ 0 |
DEBT - Additional Information (
DEBT - Additional Information (Details) | Sep. 06, 2018$ / shares | Sep. 04, 2018USD ($) | May 14, 2018$ / shares | Feb. 16, 2018$ / shares | Sep. 30, 2017USD ($)$ / sharesshares | Nov. 07, 2018USD ($) | Oct. 15, 2018USD ($) | Sep. 30, 2018USD ($)$ / sharesshares | Jun. 30, 2018USD ($) | Sep. 30, 2017USD ($)$ / sharesshares | Sep. 30, 2018USD ($)$ / sharesshares | Sep. 30, 2017USD ($)$ / sharesshares | Aug. 31, 2018USD ($) | Dec. 31, 2017USD ($) |
Debt Disclosure [Line Items] | ||||||||||||||
Payment of debt exchange expense | $ 34,000,000 | $ 14,000,000 | ||||||||||||
Debt instrument, repurchase amount | $ 53,000,000 | $ 88,000,000 | ||||||||||||
Dividend per share (in usd per share) | $ / shares | $ 0.40 | $ 0.40 | $ 0.40 | $ 0.40 | $ 0.35 | $ 1.20 | $ 1.05 | |||||||
Non-cash issuance of debt in connection with acquisition of vacation ownership units | $ 2,291,000,000 | $ 2,291,000,000 | ||||||||||||
Minimum | Revolving corporate credit facility, net | ||||||||||||||
Debt Disclosure [Line Items] | ||||||||||||||
Line of credit facility, commitment fee basis points | 0.20% | |||||||||||||
Maximum | Revolving corporate credit facility, net | ||||||||||||||
Debt Disclosure [Line Items] | ||||||||||||||
Line of credit facility, commitment fee basis points | 0.40% | |||||||||||||
IAC Notes | Senior Notes | ||||||||||||||
Debt Disclosure [Line Items] | ||||||||||||||
Principal amount | $ 88,000,000 | $ 262,000,000 | $ 262,000,000 | $ 350,000,000 | ||||||||||
Debt, stated interest rate | 5.625% | 5.625% | 5.625% | |||||||||||
Non-cash issuance of debt in connection with acquisition of vacation ownership units | $ 264,000,000 | $ 264,000,000 | ||||||||||||
Exchange Notes, net | Senior Notes | ||||||||||||||
Debt Disclosure [Line Items] | ||||||||||||||
Principal amount | 88,000,000 | $ 88,000,000 | $ 88,000,000 | |||||||||||
Debt, stated interest rate | 5.625% | 5.625% | ||||||||||||
Payment of debt exchange expense | $ 1,000,000 | |||||||||||||
Non-cash issuance of debt in connection with acquisition of vacation ownership units | $ 89,000,000 | $ 89,000,000 | ||||||||||||
Senior Unsecured Notes | Senior Notes | ||||||||||||||
Debt Disclosure [Line Items] | ||||||||||||||
Principal amount | $ 750,000,000 | $ 750,000,000 | ||||||||||||
Debt, stated interest rate | 6.50% | 6.50% | ||||||||||||
Proceeds from issuance of Senior Unsecured Notes | $ 742,000,000 | |||||||||||||
Non-cash issuance of debt in connection with acquisition of vacation ownership units | 750,000,000 | $ 750,000,000 | ||||||||||||
Revolving Corporate Credit Facility | Revolving corporate credit facility, net | ||||||||||||||
Debt Disclosure [Line Items] | ||||||||||||||
Credit facility | $ 250,000,000 | $ 250,000,000 | ||||||||||||
Revolving Corporate Credit Facility | Minimum | Variable Rate Margin | Revolving corporate credit facility, net | ||||||||||||||
Debt Disclosure [Line Items] | ||||||||||||||
Debt instrument, basis spread on variable rate | 0.50% | |||||||||||||
Revolving Corporate Credit Facility | Maximum | Variable Rate Margin | Revolving corporate credit facility, net | ||||||||||||||
Debt Disclosure [Line Items] | ||||||||||||||
Debt instrument, basis spread on variable rate | 2.75% | |||||||||||||
Convertible Notes | Convertible Debt | ||||||||||||||
Debt Disclosure [Line Items] | ||||||||||||||
Principal amount | $ 230,000,000 | $ 230,000,000 | $ 230,000,000 | |||||||||||
Debt, stated interest rate | 1.50% | 1.50% | 1.50% | |||||||||||
Debt instrument, redemption price, percentage | 10000.00% | |||||||||||||
Debt instrument, convertible, conversion ratio | 0.0000067482 | 0.0000067589 | ||||||||||||
Debt instrument, convertible, conversion price (in usd per share) | $ / shares | $ 148.19 | $ 147.95 | $ 148.19 | $ 147.95 | $ 148.19 | |||||||||
Dividend per share (in usd per share) | $ / shares | $ 0.40 | |||||||||||||
Net carrying amount of the liability component | $ 197,000,000 | $ 198,000,000 | $ 197,000,000 | $ 198,000,000 | $ 197,000,000 | $ 192,000,000 | ||||||||
Carrying amount of equity component, net of issuance costs | 33,000,000 | 33,000,000 | 33,000,000 | $ 33,000,000 | 33,000,000 | 33,000,000 | ||||||||
Unamortized debt issuance costs | $ 7,000,000 | $ 7,000,000 | $ 7,000,000 | |||||||||||
Debt instrument, convertible, remaining discount amortization period | 4 years | |||||||||||||
Percentage above common stock price to conversion price of convertible debt when instrument is eligible for conversion | 30.00% | 30.00% | 30.00% | |||||||||||
Non-cash issuance of debt in connection with acquisition of vacation ownership units | 230,000,000 | $ 230,000,000 | ||||||||||||
Term Loan | Corporate Credit Facility | ||||||||||||||
Debt Disclosure [Line Items] | ||||||||||||||
Credit facility | 900,000,000 | 900,000,000 | ||||||||||||
Non-cash issuance of debt in connection with acquisition of vacation ownership units | 900,000,000 | $ 900,000,000 | $ 0 | |||||||||||
Term Loan | Minimum | Variable Rate Margin | Revolving corporate credit facility, net | ||||||||||||||
Debt Disclosure [Line Items] | ||||||||||||||
Debt instrument, basis spread on variable rate | 1.25% | |||||||||||||
Term Loan | Maximum | Variable Rate Margin | Revolving corporate credit facility, net | ||||||||||||||
Debt Disclosure [Line Items] | ||||||||||||||
Debt instrument, basis spread on variable rate | 2.25% | |||||||||||||
Non-Interest Bearing Note Payable | Non-interest bearing note payable, net | ||||||||||||||
Debt Disclosure [Line Items] | ||||||||||||||
Non-cash issuance of debt in connection with acquisition of vacation ownership units | 31,000,000 | $ 31,000,000 | ||||||||||||
Revolving corporate credit facility, net | Corporate Credit Facility | ||||||||||||||
Debt Disclosure [Line Items] | ||||||||||||||
Credit facility | 600,000,000 | 600,000,000 | ||||||||||||
Line of credit | 0 | 0 | ||||||||||||
Revolving corporate credit facility, net | Letter of Credit | Corporate Credit Facility | ||||||||||||||
Debt Disclosure [Line Items] | ||||||||||||||
Credit facility | $ 75,000,000 | $ 75,000,000 | ||||||||||||
Convertible Note Hedges | ||||||||||||||
Debt Disclosure [Line Items] | ||||||||||||||
Option indexed to issuer's equity, indexed shares (in shares) | shares | 1,550,000 | 1,550,000 | 1,550,000 | |||||||||||
Number of convertible note hedges exercised (in shares) | shares | 0 | 0 | ||||||||||||
Private Warrants | ||||||||||||||
Debt Disclosure [Line Items] | ||||||||||||||
Number of securities called by warrants (in shares) | shares | 1,550,000 | 1,550,000 | 1,550,000 | |||||||||||
Exercise price of warrants (in usd per share) | $ / shares | $ 176.68 | $ 176.40 | $ 176.68 | $ 176.40 | $ 176.68 | |||||||||
Number of warrants exercised (in shares) | shares | 0 | 0 | ||||||||||||
Conversion Premium, Stock Price Exceeds The Conversion Price | Convertible Notes | Convertible Debt | ||||||||||||||
Debt Disclosure [Line Items] | ||||||||||||||
Effective percentage above common stock price to conversion price of convertible debt, as effected by convertible note hedge and warrant transactions | 55.00% | 55.00% | 55.00% | |||||||||||
Big Island Of Hawaii | Non-Interest Bearing Note Payable | Non-interest bearing note payable, net | ||||||||||||||
Debt Disclosure [Line Items] | ||||||||||||||
Repayment of non-interest bearing note payable | $ (33,000,000) | |||||||||||||
Non-cash issuance of debt in connection with acquisition of vacation ownership units | $ 31,000,000 | $ 31,000,000 | ||||||||||||
Subsequent Event | IAC Notes | Senior Notes | ||||||||||||||
Debt Disclosure [Line Items] | ||||||||||||||
Principal amount | $ 140,000,000 | |||||||||||||
Debt instrument, redemption price, percentage | 101.00% | |||||||||||||
Debt instrument, repurchased face amount | $ 122,000,000 | |||||||||||||
Debt instrument, repurchase amount | $ 123,000,000 |
DEBT - Net Carrying Value Of Th
DEBT - Net Carrying Value Of The Convertible Notes (Details) - Convertible Debt - Convertible Notes - USD ($) $ in Millions | Sep. 30, 2018 | Dec. 31, 2017 | Sep. 30, 2017 |
Debt Instrument [Line Items] | |||
Principal amount | $ 230 | $ 230 | |
Unamortized debt discount | (27) | (32) | |
Unamortized debt issuance costs | (5) | (6) | |
Net carrying amount of the liability component | 198 | 192 | $ 197 |
Carrying amount of equity component, net of issuance costs | $ 33 | $ 33 | $ 33 |
DEBT - Interest Expense Related
DEBT - Interest Expense Related To The Convertible Notes (Details) - Convertible Debt - Convertible Notes - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | |
Sep. 30, 2018 | Sep. 30, 2018 | Sep. 30, 2017 | |
Debt Instrument [Line Items] | |||
Contractual interest expense | $ 1 | $ 3 | $ 0 |
Amortization of debt discount | 1 | 4 | 0 |
Amortization of debt issuance costs | 1 | 1 | 0 |
Interest Expense, Debt | $ 3 | $ 8 | $ 0 |
SHAREHOLDERS' EQUITY - Addition
SHAREHOLDERS' EQUITY - Additional Information (Details) - USD ($) $ / shares in Units, $ in Millions | Sep. 30, 2018 | Dec. 31, 2017 |
Stockholders Equity Note [Line Items] | ||
Common stock, shares authorized (in shares) | 100,000,000 | 100,000,000 |
Common stock, par (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock, shares issued (in shares) | 57,611,046 | 36,861,843 |
Common stock, shares outstanding (in shares) | 47,205,452 | 26,461,296 |
Treasury stock, shares (in shares) | 10,405,594 | 10,400,547 |
Preferred stock, shares authorized (in shares) | 2,000,000 | 2,000,000 |
Preferred stock, par value (in usd per share) | $ 0.01 | $ 0.01 |
Preferred stock, issued (in shares) | 0 | 0 |
Preferred stock, outstanding (in shares) | 0 | 0 |
Share repurchase program, number of common stock authorized to be repurchased (in shares) | 11,900,000 | |
Shares remained available for repurchase under the program (in shares) | 1,400,000 | |
Noncontrolling interests | $ (25) | $ 0 |
Principal amount | $ 15 | |
Premium percentage, convertible loan facility | 20.00% | |
Property Owners Associations | ||
Stockholders Equity Note [Line Items] | ||
Noncontrolling interests | $ 11 | |
VRI Europe Limited | ||
Stockholders Equity Note [Line Items] | ||
Noncontrolling interest, ownership percentage by parent | 75.50% | |
VRI Europe Limited | CLC World Resorts and Hotels | ||
Stockholders Equity Note [Line Items] | ||
Noncontrolling interest, ownership percentage by noncontrolling interest | 24.50% | |
Noncontrolling interests | $ (18) |
SHAREHOLDERS' EQUITY - Summary
SHAREHOLDERS' EQUITY - Summary of Stock Repurchase Activity (Details) $ / shares in Units, $ in Millions | 9 Months Ended |
Sep. 30, 2018USD ($)$ / sharesshares | |
Stock Repurchase [Roll Forward] | |
Number of Shares Repurchased (in shares) | 10,400,547 |
Repurchase of common stock (in shares) | 0 |
Cost of Shares Repurchased | $ | $ 2 |
Number of Shares Repurchased (in shares) | 10,405,594 |
Treasury Stock | |
Stock Repurchase [Roll Forward] | |
Number of Shares Repurchased (in shares) | 10,440,505 |
Cost of Shares Repurchased | $ | $ 697 |
Average Price Paid per Share (in usd per share) | $ / shares | $ 66.73 |
Repurchase of common stock (in shares) | 13,969 |
Cost of Shares Repurchased | $ | $ 2 |
Average Price Paid per Share (in usd per share) | $ / shares | $ 134.70 |
Number of Shares Repurchased (in shares) | 10,454,474 |
Cost of Shares Repurchased | $ | $ 699 |
Average Price Paid per Share (in usd per share) | $ / shares | $ 66.83 |
SHAREHOLDERS' EQUITY - Cash Div
SHAREHOLDERS' EQUITY - Cash Dividend Declared (Details) - $ / shares | Sep. 06, 2018 | May 14, 2018 | Feb. 16, 2018 | Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 |
Equity [Abstract] | |||||||
Dividend per share (in usd per share) | $ 0.40 | $ 0.40 | $ 0.40 | $ 0.40 | $ 0.35 | $ 1.20 | $ 1.05 |
SHARE-BASED COMPENSATION - Addi
SHARE-BASED COMPENSATION - Additional Information (Details) $ / shares in Units, $ in Millions | Sep. 01, 2018USD ($)$ / sharesshares | Sep. 30, 2018USD ($)shares | Sep. 30, 2018USD ($)shares | Sep. 30, 2017USD ($) | Sep. 30, 2018USD ($)$ / sharesshares | Sep. 30, 2017USD ($) | Dec. 31, 2017USD ($) |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Share-based compensation expense | $ 5 | $ 4 | $ 15 | $ 12 | |||
Payroll and benefits liability | $ 194 | $ 194 | $ 194 | $ 112 | |||
Stock options | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Shares authorized for issuance under the plan (in shares) | shares | 6,000,000 | 6,000,000 | 6,000,000 | ||||
Shares available for grants under the plan (in shares) | shares | 1,000,000 | 1,000,000 | 1,000,000 | ||||
Share-based compensation expense | $ 0 | 0 | $ 0 | 0 | |||
Restricted stock units | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Share-based compensation expense | 4 | 4 | $ 13 | 11 | |||
Restricted stock units | Employees and Non Employee Directors | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Stock awards, grants in period (in shares) | shares | 141,931 | ||||||
Stock awards granted, weighted average (in usd per share) grant date fair value | $ / shares | $ 126.63 | ||||||
Performance-based RSUs | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Maximum amount of RSU subject to vesting (in shares) | shares | 71,902 | ||||||
Share-based compensation expense | 1 | 1 | $ 4 | 3 | |||
SARs | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Stock awards, grants in period (in shares) | shares | 56,649 | ||||||
Stock awards granted, weighted average (in usd per share) grant date fair value | $ / shares | $ 44.75 | ||||||
Stock awards granted, weighted average (in usd per share) exercise date fair value | $ / shares | $ 143.38 | ||||||
Share-based compensation expense | 1 | $ 0 | $ 2 | $ 1 | |||
ILG, Inc | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Business combination, share conversion ratio | 0.165 | ||||||
Business combination, share price (in usd per share) | $ / shares | $ 119 | ||||||
Legacy ILG [Member] | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Payroll and benefits liability | $ 2 | $ 2 | $ 2 | ||||
Legacy ILG [Member] | Restricted stock units | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Shares available for grants under the plan (in shares) | shares | 1,000,000 | 1,000,000 | 1,000,000 | ||||
Share-based compensation expense | $ 39 | $ 8 | |||||
Compensation not yet recognized | $ 20 | $ 20 | $ 20 | ||||
Equity instruments other than options (in shares) | shares | 400,000 | ||||||
Legacy ILG [Member] | Deferred Share Units | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Weighted average grant date fair value (in usd per share) | $ / shares | $ 114.31 | ||||||
Equity instruments other than options (in shares) | shares | 12,265 | ||||||
Legacy ILG [Member] | Cash-Based Award | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Share-based compensation expense | $ 1 | ||||||
ILG, Inc | Restricted stock units | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Weighted average grant date fair value (in usd per share) | $ / shares | $ 118.03 | ||||||
ILG, Inc | ILG, Inc | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Business combination, share price (in usd per share) | $ / shares | $ 14.75 |
SHARE-BASED COMPENSATION - Shar
SHARE-BASED COMPENSATION - Share-based Compensation Expense (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Share-based compensation expense | $ 5 | $ 4 | $ 15 | $ 12 |
Service-based RSUs | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Share-based compensation expense | 3 | 3 | 9 | 8 |
Performance-based RSUs | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Share-based compensation expense | 1 | 1 | 4 | 3 |
Restricted stock units | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Share-based compensation expense | 4 | 4 | 13 | 11 |
SARs | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Share-based compensation expense | 1 | 0 | 2 | 1 |
Stock options | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Share-based compensation expense | $ 0 | $ 0 | $ 0 | $ 0 |
SHARE-BASED COMPENSATION - Defe
SHARE-BASED COMPENSATION - Deferred Compensation Costs (Details) - USD ($) $ in Millions | Sep. 30, 2018 | Dec. 31, 2017 |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Deferred compensation costs related to unvested awards | $ 25 | $ 15 |
Service-based RSUs | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Deferred compensation costs related to unvested awards | 17 | 9 |
Performance-based RSUs | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Deferred compensation costs related to unvested awards | 7 | 5 |
Restricted stock units | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Deferred compensation costs related to unvested awards | 24 | 14 |
SARs | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Deferred compensation costs related to unvested awards | 1 | 1 |
Stock options | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Deferred compensation costs related to unvested awards | $ 0 | $ 0 |
SHARE-BASED COMPENSATION - Assu
SHARE-BASED COMPENSATION - Assumptions Used to Estimate Fair Value of Grants (Details) | 9 Months Ended |
Sep. 30, 2018 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Expected volatility | 30.78% |
Dividend yield | 1.11% |
Risk-free rate | 2.68% |
Expected term (in years) | 6 years 3 months |
VARIABLE INTEREST ENTITIES - Cl
VARIABLE INTEREST ENTITIES - Classifications of Consolidated VIE Assets and Liabilities (Details) - USD ($) $ in Millions | Sep. 30, 2018 | Dec. 31, 2017 |
Variable Interest Entity [Line Items] | ||
VIE Assets | $ 1,697 | |
VIE Liabilities | 1,703 | |
Restricted cash | 365 | $ 82 |
Secured Debt [Member] | ||
Variable Interest Entity [Line Items] | ||
VIE Liabilities | 1,701 | |
Vacation ownership notes receivable, net of reserves | ||
Variable Interest Entity [Line Items] | ||
VIE Assets | 1,557 | |
Interest receivable | ||
Variable Interest Entity [Line Items] | ||
VIE Assets | 10 | |
Restricted cash | ||
Variable Interest Entity [Line Items] | ||
VIE Assets | 130 | |
Interest payable | ||
Variable Interest Entity [Line Items] | ||
VIE Liabilities | 2 | |
Vacation Ownership Notes Receivable Securitizations | ||
Variable Interest Entity [Line Items] | ||
VIE Assets | 1,697 | |
VIE Liabilities | 1,703 | |
Vacation Ownership Notes Receivable Securitizations | Secured Debt [Member] | ||
Variable Interest Entity [Line Items] | ||
VIE Liabilities | 1,701 | |
Vacation Ownership Notes Receivable Securitizations | Vacation ownership notes receivable, net of reserves | ||
Variable Interest Entity [Line Items] | ||
VIE Assets | 1,557 | |
Vacation Ownership Notes Receivable Securitizations | Interest receivable | ||
Variable Interest Entity [Line Items] | ||
VIE Assets | 10 | |
Vacation Ownership Notes Receivable Securitizations | Restricted cash | ||
Variable Interest Entity [Line Items] | ||
VIE Assets | 130 | |
Vacation Ownership Notes Receivable Securitizations | Interest payable | ||
Variable Interest Entity [Line Items] | ||
VIE Liabilities | 2 | |
Warehouse Credit Facility | ||
Variable Interest Entity [Line Items] | ||
VIE Assets | 0 | |
VIE Liabilities | 0 | |
Warehouse Credit Facility | Secured Debt [Member] | ||
Variable Interest Entity [Line Items] | ||
VIE Liabilities | 0 | |
Warehouse Credit Facility | Vacation ownership notes receivable, net of reserves | ||
Variable Interest Entity [Line Items] | ||
VIE Assets | 0 | |
Warehouse Credit Facility | Interest receivable | ||
Variable Interest Entity [Line Items] | ||
VIE Assets | 0 | |
Warehouse Credit Facility | Restricted cash | ||
Variable Interest Entity [Line Items] | ||
VIE Assets | 0 | |
Warehouse Credit Facility | Interest payable | ||
Variable Interest Entity [Line Items] | ||
VIE Liabilities | 0 | |
2018-A Trust | Legacy ILG [Member] | Variable Interest Entity, Not Primary Beneficiary | ||
Variable Interest Entity [Line Items] | ||
Restricted cash | $ 71 |
VARIABLE INTEREST ENTITIES - In
VARIABLE INTEREST ENTITIES - Interest Income and Expense Recognized as a Result of Our Involvement with Variable Interest Entities (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | |
Variable Interest Entity [Line Items] | ||||
Interest income | $ 45 | $ 33 | $ 113 | $ 94 |
Variable Interest Entity | ||||
Variable Interest Entity [Line Items] | ||||
Interest income | 42 | 95 | ||
Interest expense to investors | 11 | 21 | ||
Debt issuance cost amortization | 1 | 4 | ||
Variable Interest Entity | Vacation Ownership Notes Receivable Securitizations | ||||
Variable Interest Entity [Line Items] | ||||
Interest income | 42 | 95 | ||
Interest expense to investors | 10 | 20 | ||
Debt issuance cost amortization | 1 | 3 | ||
Variable Interest Entity | Warehouse Credit Facility | ||||
Variable Interest Entity [Line Items] | ||||
Interest income | 0 | 0 | ||
Interest expense to investors | 1 | 1 | ||
Debt issuance cost amortization | $ 0 | $ 1 |
VARIABLE INTEREST ENTITIES - Ca
VARIABLE INTEREST ENTITIES - Cash Flows Between Company and Variable Interest Entities (Details) - USD ($) $ in Millions | 9 Months Ended | |
Sep. 30, 2018 | Sep. 30, 2017 | |
Vacation Ownership Notes Receivable Securitizations | ||
Cash Inflows | ||
Net proceeds from vacation ownership notes receivable securitizations | $ 419 | $ 347 |
Principal receipts | 227 | 171 |
Interest receipts | 92 | 71 |
Reserve release | 109 | 0 |
Total | 847 | 589 |
Cash Outflows | ||
Principal to investors | (208) | (159) |
Voluntary repurchases of defaulted vacation ownership notes receivable | (34) | (23) |
Voluntary clean-up call | (22) | 0 |
Interest to investors | (19) | (13) |
Funding of restricted cash | (117) | (2) |
Total | (400) | (197) |
Net Cash Flows | 447 | 392 |
Warehouse Credit Facility | ||
Cash Inflows | ||
Proceeds from vacation ownership notes receivable securitizations | 0 | 50 |
Principal receipts | 0 | 2 |
Interest receipts | 0 | 2 |
Total | 0 | 54 |
Cash Outflows | ||
Principal to investors | 0 | (1) |
Repayment of Warehouse Credit Facility | 0 | (49) |
Interest to investors | (1) | (2) |
Total | (1) | (52) |
Net Cash Flows | $ (1) | $ 2 |
VARIABLE INTEREST ENTITIES - Ad
VARIABLE INTEREST ENTITIES - Additional Information (Details) $ in Millions | Sep. 30, 2018USD ($) | Mar. 31, 2018vacation_ownership_unit | Dec. 31, 2017USD ($) | Jun. 30, 2017vacation_ownership_unit |
Variable Interest Entity [Line Items] | ||||
Inventory | $ 829 | $ 398 | ||
Other assets | 268 | 166 | ||
Other liabilities | 15 | 14 | ||
Marco Island Florida | ||||
Variable Interest Entity [Line Items] | ||||
Number of vacation ownership units acquired | vacation_ownership_unit | 20 | 36 | ||
Variable Interest Entity, Not Primary Beneficiary | San Francisco, California | ||||
Variable Interest Entity [Line Items] | ||||
Note receivable | 1 | |||
Maximum loss (less than) | 1 | |||
Variable Interest Entity, Not Primary Beneficiary | New York City, New York | ||||
Variable Interest Entity [Line Items] | ||||
Note receivable | 1 | |||
Maximum loss (less than) | 2 | |||
Capital lease asset | 8 | |||
Capital lease liability | 7 | |||
Variable Interest Entity, Not Primary Beneficiary | Florida | Marco Island Florida | ||||
Variable Interest Entity [Line Items] | ||||
Maximum loss (less than) | 1 | |||
Inventory | 3 | |||
Other assets | 3 | |||
Other liabilities | 7 | |||
Variable Interest Entity, Not Primary Beneficiary | Florida | Notes Receivable | Marco Island Florida | ||||
Variable Interest Entity [Line Items] | ||||
Note receivable | 1 | |||
Variable Interest Entity | ||||
Variable Interest Entity [Line Items] | ||||
Other assets | 28 | $ 14 | ||
Cash surrender value of life insurance | $ 28 |
BUSINESS SEGMENTS - Additional
BUSINESS SEGMENTS - Additional Information (Details) owner_member in Thousands, member in Millions | 1 Months Ended | 9 Months Ended |
Sep. 30, 2018memberPropertyowner_memberbrandnationresortSegment | Sep. 30, 2018memberPropertyowner_memberbrandnationresort | |
Segment Reporting Information [Line Items] | ||
Number of reportable business segments | Segment | 2 | |
Percentage of revenue outside of the United States | 13.00% | |
Vacation Ownership | ||
Segment Reporting Information [Line Items] | ||
Number of resorts (more than) | 100 | 100 |
Number of owners and/or members | owner_member | 650 | 650 |
Number of vacation ownership brands | brand | 7 | 7 |
Exchange & Third-Party Management | ||
Segment Reporting Information [Line Items] | ||
Number of resorts (more than) | 3,200 | 3,200 |
Number of nations (over) | nation | 80 | 80 |
Number of members | member | 2,000,000 | 2,000,000 |
Number of other resorts and lodging properties (more than) | Property | 200 | 200 |
BUSINESS SEGMENTS - Revenues (D
BUSINESS SEGMENTS - Revenues (Details) - USD ($) $ in Millions | 1 Months Ended | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | |
Segment Reporting, Asset Reconciling Item [Line Items] | |||||
Revenues | $ 470 | $ 750 | $ 530 | $ 1,916 | $ 1,621 |
Vacation Ownership | |||||
Segment Reporting, Asset Reconciling Item [Line Items] | |||||
Revenues | 709 | 530 | 1,875 | 1,621 | |
Exchange & Third-Party Management | |||||
Segment Reporting, Asset Reconciling Item [Line Items] | |||||
Revenues | 40 | 0 | 40 | 0 | |
Operating Segments | |||||
Segment Reporting, Asset Reconciling Item [Line Items] | |||||
Revenues | 749 | 530 | 1,915 | 1,621 | |
Operating Segments | Vacation Ownership | |||||
Segment Reporting, Asset Reconciling Item [Line Items] | |||||
Revenues | 709 | 530 | 1,875 | 1,621 | |
Operating Segments | Exchange & Third-Party Management | |||||
Segment Reporting, Asset Reconciling Item [Line Items] | |||||
Revenues | 40 | 0 | 40 | 0 | |
Corporate and other | |||||
Segment Reporting, Asset Reconciling Item [Line Items] | |||||
Revenues | $ 1 | $ 0 | $ 1 | $ 0 |
BUSINESS SEGMENTS - Net Income
BUSINESS SEGMENTS - Net Income (Loss) (Details) - USD ($) $ in Millions | 1 Months Ended | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | |
Segment Reporting, Reconciliation of Net Income (Loss) Segment to Consolidated [Line Items] | |||||
Provision for income taxes | $ 29 | $ 10 | $ (23) | $ (7) | $ (62) |
Net (loss) income | $ (68) | (58) | 40 | (11) | 116 |
Operating Segments | |||||
Segment Reporting, Reconciliation of Net Income (Loss) Segment to Consolidated [Line Items] | |||||
Segment financial results | 108 | 92 | 271 | 268 | |
Operating Segments | Vacation Ownership | |||||
Segment Reporting, Reconciliation of Net Income (Loss) Segment to Consolidated [Line Items] | |||||
Segment financial results | 96 | 92 | 259 | 268 | |
Operating Segments | Exchange & Third-Party Management | |||||
Segment Reporting, Reconciliation of Net Income (Loss) Segment to Consolidated [Line Items] | |||||
Segment financial results | 12 | 0 | 12 | 0 | |
Corporate and other | |||||
Segment Reporting, Reconciliation of Net Income (Loss) Segment to Consolidated [Line Items] | |||||
Segment financial results | $ (176) | $ (29) | $ (275) | $ (90) |
ADOPTION IMPACT OF NEW REVENU_3
ADOPTION IMPACT OF NEW REVENUE STANDARD - Income Statement Impact (Details) - USD ($) $ / shares in Units, $ in Millions | 1 Months Ended | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | |
REVENUES | |||||
Revenue from contracts with customers | $ 702 | $ 496 | $ 1,797 | $ 1,522 | |
Cost reimbursements | 234 | 177 | 652 | 561 | |
Financing | 48 | 34 | 119 | 99 | |
TOTAL REVENUES | $ 470 | 750 | 530 | 1,916 | 1,621 |
EXPENSES | |||||
Marketing and sales | 135 | 94 | 346 | 287 | |
Financing | 19 | 11 | 40 | 30 | |
General and administrative | 53 | 26 | 114 | 81 | |
Depreciation and amortization | 18 | 6 | 29 | 16 | |
Litigation settlement | 17 | 2 | 33 | 2 | |
Consumer financing interest | 0 | 0 | |||
Royalty fee | 19 | 15 | 50 | 47 | |
Cost reimbursements | 234 | 177 | 652 | 561 | |
TOTAL EXPENSES | 490 | 698 | 472 | 1,762 | 1,444 |
Gains and other income, net | 2 | 7 | (4) | 7 | |
Interest expense | (5) | (14) | (2) | (23) | (5) |
ILG acquisition costs | (72) | (108) | 0 | (128) | (1) |
Other | 0 | 0 | (3) | 0 | |
(LOSS) INCOME BEFORE INCOME TAXES AND NONCONTROLLING INTERESTS | (68) | 63 | (4) | 178 | |
Provision for income taxes | 29 | 10 | (23) | (7) | (62) |
NET INCOME | (68) | (58) | 40 | (11) | 116 |
Net income attributable to noncontrolling interests | 0 | 0 | 0 | 0 | 0 |
NET (LOSS) INCOME ATTRIBUTABLE TO COMMON SHAREHOLDERS | $ (68) | $ (58) | $ 40 | $ (11) | $ 116 |
Basic (loss) earnings per share (in usd per share) | $ (1.75) | $ 1.49 | $ (0.37) | $ 4.27 | |
Diluted (loss) earnings per share (in usd per share) | $ (1.75) | $ 1.45 | $ (0.37) | $ 4.18 | |
As Reported | |||||
REVENUES | |||||
Cost reimbursements | $ 114 | ||||
Financing | 34 | ||||
TOTAL REVENUES | 486 | ||||
EXPENSES | |||||
Marketing and sales | 100 | ||||
Financing | 5 | ||||
General and administrative | 27 | ||||
Depreciation and amortization | 0 | ||||
Litigation settlement | 2 | ||||
Consumer financing interest | 6 | ||||
Royalty fee | 15 | ||||
Cost reimbursements | 114 | ||||
TOTAL EXPENSES | 428 | ||||
Gains and other income, net | 7 | ||||
Interest expense | (2) | ||||
(LOSS) INCOME BEFORE INCOME TAXES AND NONCONTROLLING INTERESTS | 63 | ||||
Provision for income taxes | (22) | ||||
NET INCOME | 41 | ||||
Net income attributable to noncontrolling interests | 0 | ||||
NET (LOSS) INCOME ATTRIBUTABLE TO COMMON SHAREHOLDERS | $ 41 | ||||
Basic (loss) earnings per share (in usd per share) | $ 1.50 | ||||
Diluted (loss) earnings per share (in usd per share) | $ 1.47 | ||||
As Reported | Accounting Standards Update 2014-09 | |||||
REVENUES | |||||
Cost reimbursements | $ 348 | ||||
Financing | 99 | ||||
TOTAL REVENUES | 1,470 | ||||
EXPENSES | |||||
Marketing and sales | 305 | ||||
Financing | 12 | ||||
General and administrative | 84 | ||||
Depreciation and amortization | 0 | ||||
Litigation settlement | 2 | ||||
Consumer financing interest | 18 | ||||
Royalty fee | 47 | ||||
Cost reimbursements | 348 | ||||
TOTAL EXPENSES | 1,290 | ||||
Gains and other income, net | 7 | ||||
Interest expense | (5) | ||||
ILG acquisition costs | 0 | ||||
Other | (1) | ||||
(LOSS) INCOME BEFORE INCOME TAXES AND NONCONTROLLING INTERESTS | 181 | ||||
Provision for income taxes | (62) | ||||
NET INCOME | 119 | ||||
Net income attributable to noncontrolling interests | 0 | ||||
NET (LOSS) INCOME ATTRIBUTABLE TO COMMON SHAREHOLDERS | $ 119 | ||||
Basic (loss) earnings per share (in usd per share) | $ 4.36 | ||||
Diluted (loss) earnings per share (in usd per share) | $ 4.26 | ||||
ASC 606 Adjustments | Accounting Standards Update 2014-09 | |||||
REVENUES | |||||
Cost reimbursements | $ 63 | $ 213 | |||
Financing | 0 | 0 | |||
TOTAL REVENUES | 44 | 151 | |||
EXPENSES | |||||
Marketing and sales | (4) | (13) | |||
Financing | 0 | 0 | |||
General and administrative | 0 | 0 | |||
Depreciation and amortization | 0 | 0 | |||
Litigation settlement | 0 | 0 | |||
Consumer financing interest | 0 | 0 | |||
Royalty fee | 0 | 0 | |||
Cost reimbursements | 63 | 213 | |||
TOTAL EXPENSES | 44 | 154 | |||
Gains and other income, net | 0 | 0 | |||
Interest expense | 0 | 0 | |||
ILG acquisition costs | 0 | ||||
Other | 0 | ||||
(LOSS) INCOME BEFORE INCOME TAXES AND NONCONTROLLING INTERESTS | 0 | (3) | |||
Provision for income taxes | (1) | 0 | |||
NET INCOME | (1) | (3) | |||
Net income attributable to noncontrolling interests | 0 | 0 | |||
NET (LOSS) INCOME ATTRIBUTABLE TO COMMON SHAREHOLDERS | $ (1) | $ (3) | |||
Basic (loss) earnings per share (in usd per share) | $ (0.01) | $ (0.09) | |||
Diluted (loss) earnings per share (in usd per share) | $ (0.02) | $ (0.08) | |||
Sale of vacation ownership products | |||||
REVENUES | |||||
Revenue from contracts with customers | $ 252 | $ 183 | $ 632 | $ 549 | |
EXPENSES | |||||
Expenses | 64 | 46 | 167 | 141 | |
Sale of vacation ownership products | As Reported | |||||
REVENUES | |||||
Revenue from contracts with customers | 180 | ||||
EXPENSES | |||||
Expenses | 43 | ||||
Sale of vacation ownership products | As Reported | Accounting Standards Update 2014-09 | |||||
REVENUES | |||||
Revenue from contracts with customers | 544 | ||||
EXPENSES | |||||
Expenses | 132 | ||||
Sale of vacation ownership products | ASC 606 Adjustments | Accounting Standards Update 2014-09 | |||||
REVENUES | |||||
Revenue from contracts with customers | 3 | 5 | |||
EXPENSES | |||||
Expenses | 3 | 9 | |||
Resort management and other services | |||||
REVENUES | |||||
Revenue from contracts with customers | 0 | 0 | |||
EXPENSES | |||||
Expenses | 0 | 0 | |||
Resort management and other services | As Reported | |||||
REVENUES | |||||
Revenue from contracts with customers | 77 | ||||
EXPENSES | |||||
Expenses | 45 | ||||
Resort management and other services | As Reported | Accounting Standards Update 2014-09 | |||||
REVENUES | |||||
Revenue from contracts with customers | 229 | ||||
EXPENSES | |||||
Expenses | 130 | ||||
Resort management and other services | ASC 606 Adjustments | Accounting Standards Update 2014-09 | |||||
REVENUES | |||||
Revenue from contracts with customers | (7) | (20) | |||
EXPENSES | |||||
Expenses | (5) | (13) | |||
Management and exchange | |||||
REVENUES | |||||
Revenue from contracts with customers | 126 | 70 | 274 | 209 | |
EXPENSES | |||||
Expenses | 65 | 38 | 140 | 111 | |
Management and exchange | As Reported | |||||
REVENUES | |||||
Revenue from contracts with customers | 0 | ||||
EXPENSES | |||||
Expenses | 0 | ||||
Management and exchange | As Reported | Accounting Standards Update 2014-09 | |||||
REVENUES | |||||
Revenue from contracts with customers | 0 | ||||
EXPENSES | |||||
Expenses | 0 | ||||
Management and exchange | ASC 606 Adjustments | Accounting Standards Update 2014-09 | |||||
REVENUES | |||||
Revenue from contracts with customers | 0 | 0 | |||
EXPENSES | |||||
Expenses | 0 | 0 | |||
Rental | |||||
REVENUES | |||||
Revenue from contracts with customers | 90 | 66 | 239 | 203 | |
EXPENSES | |||||
Expenses | $ 74 | 57 | $ 191 | 168 | |
Rental | As Reported | |||||
REVENUES | |||||
Revenue from contracts with customers | 81 | ||||
EXPENSES | |||||
Expenses | 71 | ||||
Rental | As Reported | Accounting Standards Update 2014-09 | |||||
REVENUES | |||||
Revenue from contracts with customers | 250 | ||||
EXPENSES | |||||
Expenses | 212 | ||||
Rental | ASC 606 Adjustments | Accounting Standards Update 2014-09 | |||||
REVENUES | |||||
Revenue from contracts with customers | (15) | (47) | |||
EXPENSES | |||||
Expenses | (13) | (42) | |||
Conforming Reclassifications | |||||
REVENUES | |||||
Cost reimbursements | 0 | 0 | |||
Financing | 0 | 0 | |||
TOTAL REVENUES | 0 | 0 | |||
EXPENSES | |||||
Marketing and sales | (2) | (5) | |||
Financing | 6 | 18 | |||
General and administrative | (1) | (3) | |||
Depreciation and amortization | 6 | 16 | |||
Litigation settlement | 0 | 0 | |||
Consumer financing interest | (6) | (18) | |||
Royalty fee | 0 | 0 | |||
Cost reimbursements | 0 | 0 | |||
TOTAL EXPENSES | 0 | 0 | |||
Gains and other income, net | 0 | 0 | |||
Interest expense | 0 | 0 | |||
ILG acquisition costs | (1) | ||||
Other | 1 | ||||
(LOSS) INCOME BEFORE INCOME TAXES AND NONCONTROLLING INTERESTS | 0 | 0 | |||
Provision for income taxes | 0 | 0 | |||
NET INCOME | 0 | 0 | |||
Net income attributable to noncontrolling interests | 0 | 0 | |||
NET (LOSS) INCOME ATTRIBUTABLE TO COMMON SHAREHOLDERS | $ 0 | $ 0 | |||
Basic (loss) earnings per share (in usd per share) | $ 0 | $ 0 | |||
Diluted (loss) earnings per share (in usd per share) | $ 0 | $ 0 | |||
Conforming Reclassifications | Sale of vacation ownership products | |||||
REVENUES | |||||
Revenue from contracts with customers | $ 0 | $ 0 | |||
EXPENSES | |||||
Expenses | 0 | 0 | |||
Conforming Reclassifications | Resort management and other services | |||||
REVENUES | |||||
Revenue from contracts with customers | (70) | (209) | |||
EXPENSES | |||||
Expenses | (40) | (117) | |||
Conforming Reclassifications | Management and exchange | |||||
REVENUES | |||||
Revenue from contracts with customers | 70 | 209 | |||
EXPENSES | |||||
Expenses | 38 | 111 | |||
Conforming Reclassifications | Rental | |||||
REVENUES | |||||
Revenue from contracts with customers | 0 | 0 | |||
EXPENSES | |||||
Expenses | $ (1) | $ (2) |
ADOPTION IMPACT OF NEW REVENU_4
ADOPTION IMPACT OF NEW REVENUE STANDARD - Balance Sheet Impact (Details) - USD ($) $ in Millions | Sep. 30, 2018 | Dec. 31, 2017 |
ASSETS | ||
Cash and cash equivalents | $ 441 | $ 409 |
Restricted cash | 365 | 82 |
Accounts receivable, net | 236 | 92 |
Vacation ownership notes receivable, net | 1,959 | 1,115 |
Inventory | 829 | 398 |
Property and equipment | 952 | 583 |
Other | 268 | 166 |
TOTAL ASSETS | 9,013 | 2,845 |
LIABILITIES AND EQUITY | ||
Accounts payable | 181 | 145 |
Contract Liabilities | 449 | 153 |
Accrued liabilities | 370 | 120 |
Payroll and benefits liability | 194 | 112 |
Deferred compensation liability | 94 | 75 |
Securitized debt, net | 835 | |
Debt, net | 2,235 | 260 |
Other | 15 | 14 |
Deferred taxes | 266 | 90 |
TOTAL LIABILITIES | 5,492 | 1,804 |
Preferred stock | 0 | 0 |
Common stock | 1 | 0 |
Treasury stock | (696) | (694) |
Additional paid-in capital | 3,697 | 1,189 |
Accumulated other comprehensive income | 16 | 17 |
Retained earnings | 478 | 529 |
Stockholders' Equity, Including Portion Attributable to Noncontrolling Interest | 3,521 | 1,041 |
TOTAL LIABILITIES AND EQUITY | 9,013 | 2,845 |
Advance deposits | ||
LIABILITIES AND EQUITY | ||
Contract Liabilities | 124 | 84 |
Deferred revenue | ||
LIABILITIES AND EQUITY | ||
Contract Liabilities | $ 325 | 69 |
As Reported | Accounting Standards Update 2014-09 | ||
ASSETS | ||
Cash and cash equivalents | 409 | |
Restricted cash | 82 | |
Accounts receivable, net | 154 | |
Vacation ownership notes receivable, net | 1,120 | |
Inventory | 716 | |
Property and equipment | 253 | |
Other | 172 | |
TOTAL ASSETS | 2,906 | |
LIABILITIES AND EQUITY | ||
Accounts payable | 145 | |
Accrued liabilities | 168 | |
Payroll and benefits liability | 112 | |
Deferred compensation liability | 75 | |
Securitized debt, net | 0 | |
Debt, net | 1,095 | |
Other | 14 | |
Deferred taxes | 91 | |
TOTAL LIABILITIES | 1,861 | |
Preferred stock | 0 | |
Common stock | 0 | |
Treasury stock | (694) | |
Additional paid-in capital | 1,189 | |
Accumulated other comprehensive income | 17 | |
Retained earnings | 533 | |
Stockholders' Equity, Including Portion Attributable to Noncontrolling Interest | 1,045 | |
TOTAL LIABILITIES AND EQUITY | 2,906 | |
As Reported | Accounting Standards Update 2014-09 | Advance deposits | ||
LIABILITIES AND EQUITY | ||
Contract Liabilities | 63 | |
As Reported | Accounting Standards Update 2014-09 | Deferred revenue | ||
LIABILITIES AND EQUITY | ||
Contract Liabilities | 98 | |
Adjustments | Accounting Standards Update 2014-09 | ||
ASSETS | ||
Cash and cash equivalents | 0 | |
Restricted cash | 0 | |
Accounts receivable, net | (62) | |
Vacation ownership notes receivable, net | (5) | |
Inventory | 12 | |
Property and equipment | 0 | |
Other | (6) | |
TOTAL ASSETS | (61) | |
LIABILITIES AND EQUITY | ||
Accounts payable | 0 | |
Accrued liabilities | (48) | |
Payroll and benefits liability | 0 | |
Deferred compensation liability | 0 | |
Securitized debt, net | 0 | |
Debt, net | 0 | |
Other | 0 | |
Deferred taxes | (1) | |
TOTAL LIABILITIES | (57) | |
Preferred stock | 0 | |
Common stock | 0 | |
Treasury stock | 0 | |
Additional paid-in capital | 0 | |
Accumulated other comprehensive income | 0 | |
Retained earnings | (4) | |
Stockholders' Equity, Including Portion Attributable to Noncontrolling Interest | (4) | |
TOTAL LIABILITIES AND EQUITY | (61) | |
Adjustments | Accounting Standards Update 2014-09 | Advance deposits | ||
LIABILITIES AND EQUITY | ||
Contract Liabilities | 21 | |
Adjustments | Accounting Standards Update 2014-09 | Deferred revenue | ||
LIABILITIES AND EQUITY | ||
Contract Liabilities | (29) | |
Conforming Reclassifications | ||
ASSETS | ||
Cash and cash equivalents | 0 | |
Restricted cash | 0 | |
Accounts receivable, net | 0 | |
Vacation ownership notes receivable, net | 0 | |
Inventory | (330) | |
Property and equipment | 330 | |
Other | 0 | |
TOTAL ASSETS | 0 | |
LIABILITIES AND EQUITY | ||
Accounts payable | 0 | |
Accrued liabilities | 0 | |
Payroll and benefits liability | 0 | |
Deferred compensation liability | 0 | |
Securitized debt, net | 835 | |
Debt, net | (835) | |
Other | 0 | |
Deferred taxes | 0 | |
TOTAL LIABILITIES | 0 | |
Preferred stock | 0 | |
Common stock | 0 | |
Treasury stock | 0 | |
Additional paid-in capital | 0 | |
Accumulated other comprehensive income | 0 | |
Retained earnings | 0 | |
Stockholders' Equity, Including Portion Attributable to Noncontrolling Interest | 0 | |
TOTAL LIABILITIES AND EQUITY | 0 | |
Conforming Reclassifications | Advance deposits | ||
LIABILITIES AND EQUITY | ||
Contract Liabilities | 0 | |
Conforming Reclassifications | Deferred revenue | ||
LIABILITIES AND EQUITY | ||
Contract Liabilities | $ 0 |
ADOPTION IMPACT OF NEW REVENU_5
ADOPTION IMPACT OF NEW REVENUE STANDARD - Cash Flow Impact (Details) - USD ($) $ in Millions | 1 Months Ended | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | |
OPERATING ACTIVITIES | |||||
Net (loss) income | $ (68) | $ (58) | $ 40 | $ (11) | $ 116 |
Adjustments to reconcile net (loss) income to net cash and restricted cash provided by operating activities: | |||||
Depreciation | 16 | ||||
Amortization of debt discount and issuance costs | 12 | 6 | |||
Vacation ownership notes receivable reserve | 42 | 40 | |||
Share-based compensation | 19 | 12 | |||
Deferred income taxes | 2 | 23 | |||
Net change in assets and liabilities, net of the effects of acquisition: | |||||
Accounts receivable | (9) | 23 | |||
Vacation ownership notes receivable originations | (395) | (345) | |||
Vacation ownership notes receivable collections | 244 | 204 | |||
Inventory | 68 | 26 | |||
Purchase of vacation ownership units for future transfer to inventory | 0 | (34) | |||
Other assets | 53 | 34 | |||
Accounts payable, advance deposits and accrued liabilities | (13) | (78) | |||
Deferred revenue | 38 | 10 | |||
Payroll and benefit liabilities | (29) | 1 | |||
Deferred compensation liability | 11 | 10 | |||
Other liabilities | 1 | 0 | |||
Other, net | 6 | 7 | |||
Net cash and restricted cash provided by operating activities | $ 67 | $ 67 | 71 | ||
As Reported | |||||
OPERATING ACTIVITIES | |||||
Net (loss) income | 41 | ||||
As Reported | Accounting Standards Update 2014-09 | |||||
OPERATING ACTIVITIES | |||||
Net (loss) income | 119 | ||||
Adjustments to reconcile net (loss) income to net cash and restricted cash provided by operating activities: | |||||
Depreciation | 16 | ||||
Amortization of debt discount and issuance costs | 6 | ||||
Vacation ownership notes receivable reserve | 38 | ||||
Share-based compensation | 12 | ||||
Deferred income taxes | 21 | ||||
Net change in assets and liabilities, net of the effects of acquisition: | |||||
Accounts receivable | 25 | ||||
Vacation ownership notes receivable originations | (346) | ||||
Vacation ownership notes receivable collections | 204 | ||||
Inventory | 28 | ||||
Purchase of vacation ownership units for future transfer to inventory | (34) | ||||
Other assets | 23 | ||||
Accounts payable, advance deposits and accrued liabilities | (65) | ||||
Deferred revenue | 7 | ||||
Payroll and benefit liabilities | 1 | ||||
Deferred compensation liability | 10 | ||||
Other liabilities | (1) | ||||
Other, net | 7 | ||||
Net cash and restricted cash provided by operating activities | 71 | ||||
Adjustments | Accounting Standards Update 2014-09 | |||||
OPERATING ACTIVITIES | |||||
Net (loss) income | $ (1) | (3) | |||
Adjustments to reconcile net (loss) income to net cash and restricted cash provided by operating activities: | |||||
Depreciation | 0 | ||||
Amortization of debt discount and issuance costs | 0 | ||||
Vacation ownership notes receivable reserve | 2 | ||||
Share-based compensation | 0 | ||||
Deferred income taxes | 2 | ||||
Net change in assets and liabilities, net of the effects of acquisition: | |||||
Accounts receivable | (2) | ||||
Vacation ownership notes receivable originations | 1 | ||||
Vacation ownership notes receivable collections | 0 | ||||
Inventory | (2) | ||||
Purchase of vacation ownership units for future transfer to inventory | 0 | ||||
Other assets | 11 | ||||
Accounts payable, advance deposits and accrued liabilities | (13) | ||||
Deferred revenue | 3 | ||||
Payroll and benefit liabilities | 0 | ||||
Deferred compensation liability | 0 | ||||
Other liabilities | 1 | ||||
Other, net | 0 | ||||
Net cash and restricted cash provided by operating activities | $ 0 |
SUPPLEMENTAL GUARANTOR INFORM_3
SUPPLEMENTAL GUARANTOR INFORMATION - Balance Sheet (Details) - USD ($) $ in Millions | Sep. 30, 2018 | Dec. 31, 2017 |
Condensed Financial Statements, Captions [Line Items] | ||
Cash and cash equivalents | $ 441 | $ 409 |
Restricted cash | 365 | 82 |
Accounts receivable, net | 236 | 92 |
Vacation ownership notes receivable, net | 1,959 | 1,115 |
Inventory | 829 | 398 |
Property and equipment | 952 | 583 |
Goodwill | 2,747 | 0 |
Intangibles, net | 1,216 | 0 |
Investments in subsidiaries | 0 | |
Other | 268 | 166 |
TOTAL ASSETS | 9,013 | 2,845 |
Accounts payable | 181 | 145 |
Contract Liabilities | 449 | 153 |
Accrued liabilities | 370 | 120 |
Payroll and benefits liability | 194 | 112 |
Deferred compensation liability | 94 | 75 |
Securitized debt, net | 835 | |
Debt, net | 2,235 | 260 |
Other | 15 | 14 |
Deferred taxes | 266 | 90 |
Intercompany liabilities (receivables) / equity | 0 | |
MVW shareholders' equity | 3,496 | 1,041 |
Noncontrolling interests | 25 | 0 |
TOTAL LIABILITIES AND EQUITY | 9,013 | 2,845 |
Advance deposits | ||
Condensed Financial Statements, Captions [Line Items] | ||
Contract Liabilities | 124 | 84 |
Deferred revenue | ||
Condensed Financial Statements, Captions [Line Items] | ||
Contract Liabilities | 325 | $ 69 |
Total Eliminations | ||
Condensed Financial Statements, Captions [Line Items] | ||
Cash and cash equivalents | 0 | |
Restricted cash | 0 | |
Accounts receivable, net | (28) | |
Vacation ownership notes receivable, net | 0 | |
Inventory | 0 | |
Property and equipment | 0 | |
Goodwill | 0 | |
Intangibles, net | 0 | |
Investments in subsidiaries | (3,566) | |
Other | (38) | |
TOTAL ASSETS | (3,632) | |
Accounts payable | 8 | |
Accrued liabilities | (34) | |
Payroll and benefits liability | 0 | |
Deferred compensation liability | 0 | |
Debt, net | 0 | |
Other | 0 | |
Deferred taxes | 2 | |
Intercompany liabilities (receivables) / equity | (1,107) | |
MVW shareholders' equity | (2,494) | |
Noncontrolling interests | (7) | |
TOTAL LIABILITIES AND EQUITY | (3,632) | |
Total Eliminations | Advance deposits | ||
Condensed Financial Statements, Captions [Line Items] | ||
Contract Liabilities | 0 | |
Total Eliminations | Deferred revenue | ||
Condensed Financial Statements, Captions [Line Items] | ||
Contract Liabilities | 0 | |
MVW | Reportable Legal Entities | ||
Condensed Financial Statements, Captions [Line Items] | ||
Cash and cash equivalents | 0 | |
Restricted cash | 0 | |
Accounts receivable, net | 21 | |
Vacation ownership notes receivable, net | 0 | |
Inventory | 0 | |
Property and equipment | 0 | |
Goodwill | 2,747 | |
Intangibles, net | 0 | |
Investments in subsidiaries | 1,251 | |
Other | 28 | |
TOTAL ASSETS | 4,047 | |
Accounts payable | 33 | |
Accrued liabilities | 11 | |
Payroll and benefits liability | 16 | |
Deferred compensation liability | 0 | |
Debt, net | 198 | |
Other | 2 | |
Deferred taxes | 74 | |
Intercompany liabilities (receivables) / equity | 2,667 | |
MVW shareholders' equity | 1,046 | |
Noncontrolling interests | 0 | |
TOTAL LIABILITIES AND EQUITY | 4,047 | |
MVW | Reportable Legal Entities | Advance deposits | ||
Condensed Financial Statements, Captions [Line Items] | ||
Contract Liabilities | 0 | |
MVW | Reportable Legal Entities | Deferred revenue | ||
Condensed Financial Statements, Captions [Line Items] | ||
Contract Liabilities | 0 | |
ILG | Reportable Legal Entities | ||
Condensed Financial Statements, Captions [Line Items] | ||
Cash and cash equivalents | 2 | |
Restricted cash | 0 | |
Accounts receivable, net | 0 | |
Vacation ownership notes receivable, net | 0 | |
Inventory | 0 | |
Property and equipment | 1 | |
Goodwill | 0 | |
Intangibles, net | 0 | |
Investments in subsidiaries | (75) | |
Other | 0 | |
TOTAL ASSETS | (72) | |
Accounts payable | 0 | |
Accrued liabilities | 4 | |
Payroll and benefits liability | 0 | |
Deferred compensation liability | 0 | |
Debt, net | 0 | |
Other | 0 | |
Deferred taxes | 84 | |
Intercompany liabilities (receivables) / equity | (931) | |
MVW shareholders' equity | 771 | |
Noncontrolling interests | 0 | |
TOTAL LIABILITIES AND EQUITY | (72) | |
ILG | Reportable Legal Entities | Advance deposits | ||
Condensed Financial Statements, Captions [Line Items] | ||
Contract Liabilities | 0 | |
ILG | Reportable Legal Entities | Deferred revenue | ||
Condensed Financial Statements, Captions [Line Items] | ||
Contract Liabilities | 0 | |
Interval Acquisition Corp. | Reportable Legal Entities | ||
Condensed Financial Statements, Captions [Line Items] | ||
Cash and cash equivalents | 2 | |
Restricted cash | 0 | |
Accounts receivable, net | 21 | |
Vacation ownership notes receivable, net | 0 | |
Inventory | 0 | |
Property and equipment | 0 | |
Goodwill | 0 | |
Intangibles, net | 0 | |
Investments in subsidiaries | 1,290 | |
Other | 2 | |
TOTAL ASSETS | 1,315 | |
Accounts payable | 0 | |
Accrued liabilities | 0 | |
Payroll and benefits liability | 0 | |
Deferred compensation liability | 0 | |
Debt, net | 264 | |
Other | 0 | |
Deferred taxes | 87 | |
Intercompany liabilities (receivables) / equity | 1,039 | |
MVW shareholders' equity | (75) | |
Noncontrolling interests | 0 | |
TOTAL LIABILITIES AND EQUITY | 1,315 | |
Interval Acquisition Corp. | Reportable Legal Entities | Advance deposits | ||
Condensed Financial Statements, Captions [Line Items] | ||
Contract Liabilities | 0 | |
Interval Acquisition Corp. | Reportable Legal Entities | Deferred revenue | ||
Condensed Financial Statements, Captions [Line Items] | ||
Contract Liabilities | 0 | |
Guarantor Subsidiaries | Reportable Legal Entities | ||
Condensed Financial Statements, Captions [Line Items] | ||
Cash and cash equivalents | 37 | |
Restricted cash | 52 | |
Accounts receivable, net | 63 | |
Vacation ownership notes receivable, net | 162 | |
Inventory | 465 | |
Property and equipment | 282 | |
Goodwill | 0 | |
Intangibles, net | 1,178 | |
Investments in subsidiaries | 1,100 | |
Other | 137 | |
TOTAL ASSETS | 3,476 | |
Accounts payable | 46 | |
Accrued liabilities | 154 | |
Payroll and benefits liability | 75 | |
Deferred compensation liability | 8 | |
Debt, net | 0 | |
Other | 1 | |
Deferred taxes | 25 | |
Intercompany liabilities (receivables) / equity | 1,729 | |
MVW shareholders' equity | 1,290 | |
Noncontrolling interests | (2) | |
TOTAL LIABILITIES AND EQUITY | 3,476 | |
Guarantor Subsidiaries | Reportable Legal Entities | Advance deposits | ||
Condensed Financial Statements, Captions [Line Items] | ||
Contract Liabilities | 29 | |
Guarantor Subsidiaries | Reportable Legal Entities | Deferred revenue | ||
Condensed Financial Statements, Captions [Line Items] | ||
Contract Liabilities | 121 | |
Non-Guarantor Subsidiaries | Reportable Legal Entities | ||
Condensed Financial Statements, Captions [Line Items] | ||
Cash and cash equivalents | 400 | |
Restricted cash | 313 | |
Accounts receivable, net | 159 | |
Vacation ownership notes receivable, net | 1,797 | |
Inventory | 364 | |
Property and equipment | 669 | |
Goodwill | 0 | |
Intangibles, net | 38 | |
Investments in subsidiaries | 0 | |
Other | 139 | |
TOTAL ASSETS | 3,879 | |
Accounts payable | 94 | |
Accrued liabilities | 235 | |
Payroll and benefits liability | 103 | |
Deferred compensation liability | 86 | |
Debt, net | 1,773 | |
Other | 12 | |
Deferred taxes | (6) | |
Intercompany liabilities (receivables) / equity | (3,397) | |
MVW shareholders' equity | 2,958 | |
Noncontrolling interests | 34 | |
TOTAL LIABILITIES AND EQUITY | 3,879 | |
Non-Guarantor Subsidiaries | Reportable Legal Entities | Advance deposits | ||
Condensed Financial Statements, Captions [Line Items] | ||
Contract Liabilities | 95 | |
Non-Guarantor Subsidiaries | Reportable Legal Entities | Deferred revenue | ||
Condensed Financial Statements, Captions [Line Items] | ||
Contract Liabilities | 204 | |
Securitized debt | ||
Condensed Financial Statements, Captions [Line Items] | ||
Securitized debt, net | 1,688 | |
Securitized debt | Total Eliminations | ||
Condensed Financial Statements, Captions [Line Items] | ||
Securitized debt, net | 0 | |
Securitized debt | MVW | Reportable Legal Entities | ||
Condensed Financial Statements, Captions [Line Items] | ||
Securitized debt, net | 0 | |
Securitized debt | ILG | Reportable Legal Entities | ||
Condensed Financial Statements, Captions [Line Items] | ||
Securitized debt, net | 0 | |
Securitized debt | Interval Acquisition Corp. | Reportable Legal Entities | ||
Condensed Financial Statements, Captions [Line Items] | ||
Securitized debt, net | 0 | |
Securitized debt | Guarantor Subsidiaries | Reportable Legal Entities | ||
Condensed Financial Statements, Captions [Line Items] | ||
Securitized debt, net | 0 | |
Securitized debt | Non-Guarantor Subsidiaries | Reportable Legal Entities | ||
Condensed Financial Statements, Captions [Line Items] | ||
Securitized debt, net | $ 1,688 |
SUPPLEMENTAL GUARANTOR INFORM_4
SUPPLEMENTAL GUARANTOR INFORMATION - Income Statement (Details) - USD ($) $ in Millions | 1 Months Ended | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | |
Condensed Financial Statements, Captions [Line Items] | |||||
Revenues | $ 470 | $ 750 | $ 530 | $ 1,916 | $ 1,621 |
Expenses | (490) | (698) | (472) | (1,762) | (1,444) |
Interest expense | (5) | (14) | (2) | (23) | (5) |
ILG acquisition-related costs | (72) | (108) | 0 | (128) | (1) |
Income tax benefit | 29 | 10 | (23) | (7) | (62) |
NET INCOME | (68) | (58) | 40 | (11) | 116 |
Net income attributable to noncontrolling interests | 0 | 0 | 0 | 0 | 0 |
Net (loss) income attributable to common shareholders | (68) | $ (58) | $ 40 | $ (11) | $ 116 |
Reportable Legal Entities | MVW | |||||
Condensed Financial Statements, Captions [Line Items] | |||||
Revenues | 0 | ||||
Expenses | (3) | ||||
Interest expense | 0 | ||||
ILG acquisition-related costs | (42) | ||||
Income tax benefit | 14 | ||||
NET INCOME | (31) | ||||
Net income attributable to noncontrolling interests | 0 | ||||
Net (loss) income attributable to common shareholders | (31) | ||||
Reportable Legal Entities | ILG | |||||
Condensed Financial Statements, Captions [Line Items] | |||||
Revenues | 0 | ||||
Expenses | (4) | ||||
Interest expense | 0 | ||||
ILG acquisition-related costs | 0 | ||||
Income tax benefit | 1 | ||||
NET INCOME | (3) | ||||
Net income attributable to noncontrolling interests | 0 | ||||
Net (loss) income attributable to common shareholders | (3) | ||||
Reportable Legal Entities | Interval Acquisition Corp. | |||||
Condensed Financial Statements, Captions [Line Items] | |||||
Revenues | 0 | ||||
Expenses | 0 | ||||
Interest expense | (1) | ||||
ILG acquisition-related costs | 0 | ||||
Income tax benefit | 0 | ||||
NET INCOME | (1) | ||||
Net income attributable to noncontrolling interests | 0 | ||||
Net (loss) income attributable to common shareholders | (1) | ||||
Reportable Legal Entities | Guarantor Subsidiaries | |||||
Condensed Financial Statements, Captions [Line Items] | |||||
Revenues | 114 | ||||
Expenses | (138) | ||||
Interest expense | 0 | ||||
ILG acquisition-related costs | 0 | ||||
Income tax benefit | 7 | ||||
NET INCOME | (17) | ||||
Net income attributable to noncontrolling interests | 0 | ||||
Net (loss) income attributable to common shareholders | (17) | ||||
Reportable Legal Entities | Non-Guarantor Subsidiaries | |||||
Condensed Financial Statements, Captions [Line Items] | |||||
Revenues | 356 | ||||
Expenses | (345) | ||||
Interest expense | (4) | ||||
ILG acquisition-related costs | (30) | ||||
Income tax benefit | 7 | ||||
NET INCOME | (16) | ||||
Net income attributable to noncontrolling interests | 0 | ||||
Net (loss) income attributable to common shareholders | (16) | ||||
Total Eliminations | |||||
Condensed Financial Statements, Captions [Line Items] | |||||
Revenues | 0 | ||||
Expenses | 0 | ||||
Interest expense | 0 | ||||
ILG acquisition-related costs | 0 | ||||
Income tax benefit | 0 | ||||
NET INCOME | 0 | ||||
Net income attributable to noncontrolling interests | 0 | ||||
Net (loss) income attributable to common shareholders | $ 0 |
SUPPLEMENTAL GUARANTOR INFORM_5
SUPPLEMENTAL GUARANTOR INFORMATION - Cash Flow (Details) - USD ($) $ in Millions | 1 Months Ended | 9 Months Ended | |
Sep. 30, 2018 | Sep. 30, 2018 | Sep. 30, 2017 | |
Condensed Financial Statements, Captions [Line Items] | |||
Net cash and restricted cash provided by (used in) operating activities | $ 67 | $ 67 | $ 71 |
Net cash and restricted cash used in investing activities | (1,423) | (1,423) | (33) |
Net cash and restricted cash (used in) provided by financing activities | 1,671 | 1,671 | 248 |
Cash, cash equivalents and restricted cash, beginning of period | 491 | 491 | 213 |
Cash, cash equivalents and restricted cash, end of period | 806 | 806 | $ 502 |
MVW | |||
Condensed Financial Statements, Captions [Line Items] | |||
Net cash and restricted cash provided by (used in) operating activities | 60 | ||
Net cash and restricted cash used in investing activities | (13) | ||
Net cash and restricted cash (used in) provided by financing activities | (47) | ||
Cash, cash equivalents and restricted cash, beginning of period | 0 | ||
Cash, cash equivalents and restricted cash, end of period | 0 | 0 | |
ILG | |||
Condensed Financial Statements, Captions [Line Items] | |||
Net cash and restricted cash provided by (used in) operating activities | 0 | ||
Net cash and restricted cash used in investing activities | 0 | ||
Net cash and restricted cash (used in) provided by financing activities | 0 | ||
Cash, cash equivalents and restricted cash, beginning of period | 2 | ||
Cash, cash equivalents and restricted cash, end of period | 2 | 2 | |
Interval Acquisition Corp. | |||
Condensed Financial Statements, Captions [Line Items] | |||
Net cash and restricted cash provided by (used in) operating activities | (2) | ||
Net cash and restricted cash used in investing activities | 0 | ||
Net cash and restricted cash (used in) provided by financing activities | 2 | ||
Cash, cash equivalents and restricted cash, beginning of period | 2 | ||
Cash, cash equivalents and restricted cash, end of period | 2 | 2 | |
Guarantor Subsidiaries | |||
Condensed Financial Statements, Captions [Line Items] | |||
Net cash and restricted cash provided by (used in) operating activities | (32) | ||
Net cash and restricted cash used in investing activities | (2) | ||
Net cash and restricted cash (used in) provided by financing activities | (4) | ||
Cash, cash equivalents and restricted cash, beginning of period | 126 | ||
Cash, cash equivalents and restricted cash, end of period | 88 | 88 | |
Non-Guarantor Subsidiaries | |||
Condensed Financial Statements, Captions [Line Items] | |||
Net cash and restricted cash provided by (used in) operating activities | 41 | ||
Net cash and restricted cash used in investing activities | (1,408) | ||
Net cash and restricted cash (used in) provided by financing activities | 1,720 | ||
Cash, cash equivalents and restricted cash, beginning of period | 361 | ||
Cash, cash equivalents and restricted cash, end of period | $ 714 | $ 714 |