Every year companies all over the world produce and publish their annual accounts, the timeshare industry is no different. Apart from the pages and pages of information that we don’t need to know about, there is also the most important figure, profit or loss.
Recently 3 of the largest timeshare groups posted results, those being Hilton Grand Vacations (HGV), Travel + Leisure Co and Marriott Vacations Worldwide, the numbers are mind blowing. In brief, let’s look at each one:
Hilton Grand Vacations (HGV)
HGV is the timeshare leader by revenue size. Last year, it generated $3.978 billion in revenue and produced a net income of $313 million. The group has risen in stature by acquiring two companies in the past few years, being Bluegreen Vacations in a $1.5 billion deal last November and Diamond Resorts for $1.4 billion in August 2021. HGV has more than 150 resorts and more than 525,000 club members.
Travel + Leisure Co.
Travel + Leisure Co is the second largest timeshare operator based on gross revenue. In 2023, it generated a net income of $396 million on gross revenue of $3.8 billion.
The group’s portfolio includes Wyndham, Margaritaville, Sports Illustrated, and the recently acquired Accor Vacation Club. Also in the portfolio is Resorts Condominium International, better known to you and me as RCI, the largest of the exchange platforms.
Marriott Vacations Worldwide
Marriott Vacations Worldwide last year generated $3.53 billion in revenue and a net income of $219 million. The company taps into the loyalty programs of Marriott International and Hyatt. It has about 700,000 owner families as customers.
Like its rivals, Marriott Vacations says it is concentrating on growing its tour flow cost effectively, seeking to grow first-time buyer tours through a strategy that emphasises new sales locations and new marketing channels, such as digital and social media marketing. Marriot also own the second largest of the exchange companies being Interval International.
TCA Comment
We can think of one word, WOW! The numbers above are truly telephone numbers. Despite the size of both the gross and net revenue, new timeshare sales numbers are slipping, HGV executives said it had seen “some more hesitancy, particularly with new buyers” about signing up for deals, a pattern they had seen since the second half of the third quarter last year persisting into early this year.
Mark Wang, president and CEO of HGV said “The inflationary pressures out there have put some pressure on people’s ability to deal with their essential payments.” From this we guess he means luxury purchases such as timeshare are put aside because of inflationary pressure.
The figures from the USA are in stark contrast to those across Europe, in timeshare hot spots, such as Spain, sales of new timeshare are virtually nonexistent with a number of developers actually closing their sales divisions.
To be honest, TCA hasn’t read the accounts of the three giants mentioned above from cover to cover; however, we would hazard a guess that a considerable contributor to the bottom line is revenue from existing timeshare owners. According to comment from HGV, current owners of timeshares remain broadly resilient, however. A tiny uptick in the delinquency rate was “nothing overly material”. Delinquency in simple parlance means those owners who throw in the towel and walk away, normally not paying either their maintenance fees or finance related to their timeshare purchase.
As a final point, figures we have seen would indicate that the sale of new timeshare in the USA from resort tours of prospective customers has a closing rate of around 15%. Put simply, this means that 85% of those who tour decide at the end not to buy. Even at just 15%, this still contributes to the telephone numbers above.
For more information regarding this article or assistance in any other timeshare related issues please contact the TCA on 01908 881058 or email: info@TimeshareConsumerAssociation.org.uk