Wyndham Hotels & Resorts, Inc. Quarterly report pursuant to Section 13 or 15(d)

Quarterly report pursuant to Section 13 or 15(d)

Segment Information

Segment Information

6 Months Ended

Jun. 30, 2019

The reportable segments presented below represent Wyndham Hotels’ operating segments for which separate financial information is available and is utilized on a regular basis by its chief operating decision maker to assess performance and allocate resources. In identifying its reportable segments, Wyndham Hotels also considers the nature of services provided by its operating segments. Management evaluates the operating results of each of its reportable segments based upon net revenues and “Adjusted EBITDA”, which is defined as net income excluding interest expense, depreciation and amortization, impairment charges, restructuring and related charges, contract termination costs, transaction-related expenses (acquisition-, disposition- or separation-related), foreign currency impacts of highly inflationary countries, stock-based compensation expense, early extinguishment of debt costs and income taxes. Beginning with the third quarter of 2018, Wyndham Hotels’ calculation of Adjusted EBITDA excludes the currency effects of highly inflationary countries. Wyndham Hotels believes that Adjusted EBITDA is a useful measure of performance for its segments which, when considered with U.S. GAAP measures, Wyndham Hotels believes allows a more complete understanding of its operating performance. Wyndham Hotels’ presentation of Adjusted EBITDA may not be comparable to similarly-titled measures used by other companies.



	Three Months Ended June 30,
	2019					2018
	Net Revenues		Adjusted EBITDA			Net Revenues		Adjusted EBITDA
Hotel Franchising	$	331	$	162		$	289	$	129
Hotel Management	201		16			146		8
Total Reportable Segments	532		178			435		137
Corporate and Other	1		(19		)	—		(12		)
Total Company	$	533	$	159		$	435	$	125

The table below is a reconciliation of Net income to Adjusted EBITDA.



	Three Months Ended June 30,
	2019		2018
Net income	$	26	$	21
Provision for income taxes	10		8
Depreciation and amortization	27		22
Interest expense, net	26		10
Stock-based compensation	4		1
Impairment, net	45		—
Contract termination costs	9		—
Separation-related expenses	1		35
Transaction-related expenses, net	11		28
Adjusted EBITDA	$	159	$	125



	Six Months Ended June 30,
	2019					2018
	Net Revenues		Adjusted EBITDA			Net Revenues		Adjusted EBITDA
Hotel Franchising	$	600	$	275		$	491	$	214
Hotel Management	398		31			246		24
Total Reportable Segments	998		306			737		238
Corporate and Other	3		(36		)	—		(21		)
Total Company	$	1,001	$	270		$	737	$	217

The table below is a reconciliation of Net income to Adjusted EBITDA.



	Six Months Ended June 30,
	2019		2018
Net income	$	47	$	61
Provision for income taxes	15		24
Depreciation and amortization	56		41
Interest expense, net	50		11
Stock-based compensation	7		4
Impairment, net	45		—
Contract termination costs	9		—
Separation-related expenses	22		46
Transaction-related expenses, net	18		30
Foreign currency impact of highly inflationary countries	1		—
Adjusted EBITDA	$	270	$	217