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 Wyndham Worldwide Reports Fourth Quarter and Full Year 2014 Earnings
   Tuesday, February 10, 2015 6:30:00 AM ET

Wyndham Worldwide Corporation (WYN ) today announced results for the three months and year ended December 31, 2014.

Highlights:

-- Fourth quarter adjusted diluted earnings per share (EPS) was $0.90, an increase of 23% from adjusted diluted EPS of $0.73 in the fourth quarter of 2013. Reported diluted EPS was $0.65 in the fourth quarter of 2014, unchanged from the same period in 2013.

-- Full year adjusted diluted EPS was $4.53, an increase of 18% from adjusted diluted EPS of $3.83 for the prior year period. Reported diluted EPS was $4.18 compared with $3.21 for the prior year period.

-- During the quarter, the Company repurchased 2.1 million shares of its common stock for $171 million. For the full year, the Company spent $652 million to repurchase 8.6 million shares of its common stock.



-- The Company’s Board of Directors authorized an increase in the quarterly cash dividend to $0.42 from $0.35 per share, beginning with the dividend that is expected to be declared in the first quarter of 2015.

-- The Company increased its annual free cash flow target to $800 million from $750 million beginning in 2015.

"A strong fourth quarter led to 18% growth in full-year adjusted EPS, capping another year of double-digit earnings growth," said Stephen P. Holmes, chairman and CEO. "All three of our businesses performed well and we’re enthusiastic about the opportunities and initiatives that will drive growth going forward. As an indication of confidence in our prospects, the Board of Directors approved a 20% increase in our quarterly dividend."

FOURTH QUARTER 2014 OPERATING RESULTS

Fourth quarter revenues were $1.2 billion, an increase of 3% from the prior year period, or 4% in constant currency. The increase reflects growth in all of the Company’s business segments.

Adjusted net income was $112 million, or $0.90 per diluted share, compared with $96 million, or $0.73 per diluted share for the same period in 2013. The increases reflect stronger operating results in the Company’s lodging and vacation exchange and rentals businesses and lower net interest expense. EPS also benefited from the Company’s share repurchase program, which decreased weighted average diluted share count by 5% year-over-year.

Reported net income for the fourth quarter of 2014 was $81 million, or $0.65 per diluted share, compared with $86 million, or $0.65 per diluted share, for the fourth quarter of 2013. Reported net income in both periods reflects several items excluded from adjusted net income. The net result of these items unfavorably impacted fourth quarter 2014 net income by $31 million and unfavorably impacted fourth quarter 2013 net income by $10 million. Full reconciliations of adjusted results to GAAP results appear in Table 8 of this press release.

FULL YEAR 2014 OPERATING RESULTS

Revenues for full year 2014 were $5.3 billion, an increase of 5% over the prior year period. Adjusted net income for the full year 2014 was $573 million, or $4.53 per diluted share, compared with $515 million, or $3.83 per diluted share, for the prior year. The increases reflect stronger operating results across all of the Company’s businesses. EPS also benefited from the Company’s share repurchase program, which decreased weighted average diluted share count by 6% compared with 2013.

Reported net income for full year 2014 was $529 million, or $4.18 per diluted share, compared with reported net income of $432 million, or $3.21 per diluted share, for the prior year period. Reported net income reflects several items excluded from adjusted net income. The net result of these items unfavorably impacted full year 2014 net income by $44 million and unfavorably impacted full year 2013 net income by $83 million. Full reconciliations of adjusted results to GAAP results appear in Table 8 of this press release.

FULL YEAR 2014 CASH FLOW

Free cash flow was $749 million for the year ended December 31, 2014, compared with $770 million for the same period in 2013. The Company defines free cash flow as net cash provided by operating activities less capital expenditures. For the year ended December 31, 2014, net cash provided by operating activities was $984 million, compared with $1,008 million in the prior year period.

BUSINESS UNIT RESULTS

Lodging (Wyndham Hotel Group)

Revenues were $267 million in the fourth quarter of 2014, a 9% increase over the fourth quarter of 2013.

Domestic RevPAR increased 8.6%, partially offset by a 7.8% decline in international RevPAR, resulting in a 3.0% increase in total system-wide RevPAR compared with the fourth quarter of 2013. In constant currency, total system-wide RevPAR increased 5.0%.

Adjusted EBITDA for the fourth quarter of 2014 was $79 million, a 23% increase compared with the fourth quarter of 2013. The increase primarily reflects higher RevPAR and the favorable timing of loyalty and marketing expenses compared with the same period last year.

As of December 31, 2014, the Company’s hotel system consisted of approximately 7,650 properties and approximately 661,000 rooms, a 2.4% room increase compared with the fourth quarter of 2013. The development pipeline included approximately 960 hotels and 117,000 rooms, of which 57% were international and 64% were new construction.

Vacation Exchange and Rentals (Wyndham Exchange & Rentals)

Revenues were $311 million in the fourth quarter of 2014, a 2% increase over the fourth quarter of 2013. In constant currency, revenues were up 6%.

Exchange revenues were $150 million, flat compared with the fourth quarter of 2013. In constant currency, exchange revenues increased 2%, as the average number of members increased 2.2% and exchange revenue per member was flat.

Vacation rental revenues were $144 million, a 4% increase over the fourth quarter of 2013. In constant currency, vacation rental revenues were up 11%, reflecting a 7.3% increase in transaction volume and a 3.3% increase in the average net price per vacation rental.

Adjusted EBITDA for the fourth quarter of 2014 was $39 million, an 8% increase compared with the fourth quarter of 2013. On a currency-neutral basis, adjusted EBITDA increased 14% compared with the prior year period due to the revenue increases and cost controls.

Vacation Ownership (Wyndham Vacation Ownership)

Revenues were $668 million in the fourth quarter of 2014, a 2% increase over the fourth quarter of 2013, primarily reflecting higher resort management fees.

Gross VOI sales were $470 million in the fourth quarter of 2014, a decrease of 4% compared with the fourth quarter of 2013, reflecting a 1.4% decline in volume per guest and a 2.1% decline in tour flow.

Net VOI sales were flat compared with the fourth quarter of 2013, reflecting a lower provision for loan loss resulting from improved portfolio performance.

EBITDA for the fourth quarter of 2014 was $172 million, flat compared with the fourth quarter of 2013.

Other Items

-- The Company repurchased 2.1 million shares of common stock for $171 million during the fourth quarter of 2014. For the full-year 2014, the Company purchased 8.6 million shares of common stock for $652 million. From January 1 through February 9, 2015, the Company repurchased an additional 0.8 million shares for $68 million. The Company’s remaining share repurchase authorization totals $948 million as of February 9, 2015.

-- Reported net interest expense in the fourth quarter of 2014 was $25 million, compared with $32 million in the fourth quarter of 2013, primarily reflecting the benefit of lower interest rates associated with fixed-for-floating interest rate swaps.

Balance Sheet Information as of December 31, 2014:

-- Cash and cash equivalents of $183 million, compared with $194 million at December 31, 2013

-- Vacation ownership contract receivables, net, of $2.7 billion, compared with $2.8 billion at December 31, 2013

-- Vacation ownership and other inventory of $1.2 billion, compared with $1.0 billion at December 31, 2013

-- Securitized vacation ownership debt of $2.2 billion, compared with $1.9 billion at December 31, 2013

-- Long-term debt of $2.9 billion, unchanged from December 31, 2013. The remaining borrowing capacity on the revolving credit facility, net of commercial paper borrowings, was $1.3 billion as of December 31, 2014, unchanged from December 31, 2013

A schedule of debt is included in Table 5 of this press release.

Outlook

Note to Editors: The guidance excludes possible future share repurchases, while analysts’ estimates often include share repurchases. This results in discrepancies between Company guidance and database consensus forecasts.

For the full year 2015, the Company provides the following guidance:

-- Revenues of approximately $5.450 - $5.550 billion from $5.400 - $5.500 billion.

-- Adjusted EBITDA of approximately $1.285 - $1.315 billion from $1.300 - $1.330 billion, reflecting the adverse impact of foreign exchange partially offset by stronger underlying performance. Based on January 31, 2015 rates, foreign exchange movements have had a $25 million adverse effect on 2015 EBITDA guidance since the Company’s initial 2015 guidance, which was issued on October 24, 2014. The Company’s 2015 guidance reflects a $34 million adverse impact from foreign exchange compared with 2014 full year results.

-- Adjusted EPS of approximately $4.75 - $4.90 based on a diluted share count of 123 million from $4.70 - $4.85 based on a diluted share count of 125 million.

Conference Call Information

Wyndham Worldwide Corporation will hold a conference call with investors to discuss the Company’s results, outlook and guidance on Tuesday, February 10, 2015 at 8:30 a.m. EST. Listeners may access the webcast live through the Company’s website at www.wyndhamworldwide.com/investors. An archive of this webcast will be available on the website for approximately 90 days beginning at noon EST on February 10, 2015. The conference call may also be accessed by dialing 800-369-2125 and providing the passcode "WYNDHAM." Listeners are urged to call at least 10 minutes prior to the scheduled start time. A telephone replay will be available for approximately 90 days beginning at noon EST on February 10, 2015, at 888-484-4840.

The Company will post guidance information on its website following the conference call.

Presentation of Financial Information

Financial information discussed in this press release includes non-GAAP measures, which include or exclude certain items. These non-GAAP measures differ from reported GAAP results and are intended to illustrate what management believes are relevant period-over-period comparisons and are helpful to investors as an additional tool for further understanding and assessing the Company’s ongoing core operating performance. Exclusion of items in our non-GAAP presentation should not be considered an inference that these items are unusual, infrequent or non-recurring. A complete reconciliation of reported GAAP results to the comparable non-GAAP information appears in the financial tables section of the press release. It is not practicable to provide a reconciliation of forecasted adjusted EBITDA and adjusted EPS to the most directly comparable GAAP measures because certain items cannot be reasonably estimated or predicted at this time. Any such items could be significant to the Company’s reported results.

About Wyndham Worldwide Corporation

One of the world’s largest hospitality companies, Wyndham Worldwide (WYN ) provides a wide range of hospitality services and products through its global portfolio of world-renowned brands. The world’s largest hotel company based on the number of properties, Wyndham Hotel Group is home to many of the world’s best-known hotel brands, with over 7,600 franchised hotels and approximately 661,000 hotel rooms worldwide. Wyndham Exchange & Rentals is the worldwide leader in vacation exchange and the world’s largest professionally managed vacation rentals business, providing more than 5 million leisure-bound families annually with access to over 107,000 vacation properties in over 100 countries through its prominent exchange and vacation rental brands. The industry and timeshare ownership market leader, Wyndham Vacation Ownership develops, markets, and sells vacation ownership interests and provides consumer financing to owners through its network of over 200 vacation ownership resorts serving approximately 904,000 owners throughout the United States, Canada, Mexico, the Caribbean, and the South Pacific. Based in Parsippany, NJ, Wyndham Worldwide employs over 34,000 associates globally. For more information, please visit www.wyndhamworldwide.com.

Forward-Looking Statements

This press release contains "forward-looking statements" within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended, conveying management’s expectations as to the future based on plans, estimates and projections at the time the Company makes the statements. Forward-looking statements involve known and unknown risks, uncertainties and other factors, which may cause the actual results, performance or achievements of the Company to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. The forward-looking statements contained in this press release include statements related to the Company’s revenues, earnings, dividends and related financial and operating measures.

You are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of this press release. Factors that could cause actual results to differ materially from those in the forward-looking statements include general economic conditions, the performance of the financial and credit markets, the economic environment for the hospitality industry, the impact of war, terrorist activity or political strife, operating risks associated with the hotel, vacation exchange and rentals and vacation ownership businesses, as well as those described in the Company’s Annual Report on Form 10-K, filed with the SEC on February 14, 2014. Except for the Company’s ongoing obligations to disclose material information under the federal securities laws, it undertakes no obligation to release publicly any revisions to any forward-looking statements, to report events or to report the occurrence of unanticipated events.

                                                                                                                                                                                                                                                                                      Table 1
                                                                                                                                                                                                                                                                                      (1 of 2)
Wyndham Worldwide Corporation
OPERATING RESULTS OF REPORTABLE SEGMENTS
(In millions)
In addition to other measures, management evaluates the operating results of each of its reportable segments based upon net revenues and "EBITDA", which is defined as net income before depreciation and amortization, interest expense (excluding consumer financing interest), early extinguishment of debt, interest income (excluding consumer financing interest) and income taxes, each of which is presented on the Company’s Consolidated Statements of Income.  The Company believes that EBITDA is a useful measure of performance for the Company’s segments which when considered with GAAP measures, gives a more complete understanding of its operating performance.  The Company’s presentation of EBITDA may not be comparable to similarly-titled measures used by other companies.
The following tables summarize net revenues and EBITDA for the Company’s reportable segments, as well as reconcile EBITDA to Net income attributable to Wyndham shareholders for the three months ended December 31, 2014 and 2013:
                                                                            Three Months Ended December 31,
                                                                            2014                                                                                                                         2013
                                                                            Net Revenues                                                   EBITDA                                                        Net Revenues                                                   EBITDA
Lodging                                                                     $                                                       267    $                                                       77    $                                                       245    $        47
Vacation Exchange and Rentals                                                                                                       311                                                            2                                                             305             36
Vacation Ownership                                                                                                                  668                                                            172                                                           658             172
Total Reportable Segments                                                                                                           1,246                                                          251                                                           1,208           255
Corporate and Other (a)                                                                                                             (15)                                                           (36)                                                          (13)            (33)
Total Company                                                               $                                                       1,231  $                                                       215   $                                                       1,195  $        222
Reconciliation of EBITDA to Net income attributable to Wyndham shareholders
                                                                                                                                           Three Months Ended December 31,
                                                                                                                                           2014                                                                                                                         2013
EBITDA                                                                                                                                     $                                                       215                                                                  $        222
Depreciation and amortization                                                                                                                                                                      58                                                                            56
Interest expense                                                                                                                                                                                   29                                                                            34
Interest income                                                                                                                                                                                    (4)                                                                           (2)
Income before income taxes                                                                                                                                                                         132                                                                           134
Provision for income taxes                                                                                                                                                                         51                                                                            48
Net income attributable to Wyndham shareholders                                                                                            $                                                       81                                                                   $        86
__________
(a)  Includes the elimination of transactions between segments.
The following tables summarize net revenues and adjusted EBITDA for the Company’s reportable segments for the three months ended December 31, 2014 and 2013 (for a description of adjustments by segment, see Table 7):
                                                                            Three Months Ended December 31,
                                                                            2014                                                                                                                         2013
                                                                            Net Revenues                                                   Adjusted                                                      Net Revenues                                                   Adjusted
                                                                                                                                           EBITDA                                                                                                                       EBITDA
Lodging                                                                     $                                                       267    $                                                       79    $                                                       245    $        64
Vacation Exchange and Rentals                                                                                                       311                                                            39                                                            305             36
Vacation Ownership                                                                                                                  668                                                            172                                                           658             172
Total Reportable Segments                                                                                                           1,246                                                          290                                                           1,208           272
Corporate and Other                                                                                                                 (15)                                                           (38)                                                          (13)            (33)
Total Company                                                               $                                                       1,231  $                                                       252   $                                                       1,195  $        239
                                                                                                                                                                                                                       Table 1
                                                                                                                                                                                                                       (2 of 2)
Wyndham Worldwide Corporation
OPERATING RESULTS OF REPORTABLE SEGMENTS
(In millions)
The following tables summarize net revenues and EBITDA for the Company’s reportable segments, as well as reconcile EBITDA to Net income attributable to Wyndham shareholders for the twelve months ended December 31, 2014 and 2013:
                                                                            Twelve Months Ended December 31,
                                                                            2014                                                                  2013
                                                                            Net Revenues                       EBITDA                             Net Revenues                       EBITDA
Lodging                                                                     $                1,101             $                327               $                1,027             $                279
Vacation Exchange and Rentals                                                                1,604                              335                                1,526                              356
Vacation Ownership                                                                           2,638                              660                                2,515                              619
Total Reportable Segments                                                                    5,343                              1,322                              5,068                              1,254
Corporate and Other (a)                                                                      (62)                               (141)                              (59)                               (122)
Total Company                                                               $                5,281             $                1,181             $                5,009             $                1,132
Reconciliation of EBITDA to Net income attributable to Wyndham shareholders
                                                                                                               Twelve Months Ended December 31,
                                                                                                               2014                                                                  2013
EBITDA                                                                                                         $                1,181                                                $                1,132
Depreciation and amortization                                                                                                   233                                                                   216
Interest expense                                                                                                                113                                                                   131
Early extinguishment of debt                                                                                                    -                                                                     111
Interest income                                                                                                                 (10)                                                                  (9)
Income before income taxes                                                                                                      845                                                                   683
Provision for income taxes                                                                                                      316                                                                   250
Net income                                                                                                                      529                                                                   433
Net income attributable to noncontrolling interest                                                                              -                                                                     (1)
Net income attributable to Wyndham shareholders                                                                $                529                                                  $                432
__________
(a)  Includes the elimination of transactions between segments.
The following tables summarize net revenues and adjusted EBITDA for the Company’s reportable segments for the twelve months ended December 31, 2014 and 2013 (for a description of adjustments by segment, see Table 7):
                                                                            Twelve Months Ended December 31,
                                                                            2014                                                                  2013
                                                                            Net Revenues                       Adjusted                           Net Revenues                       Adjusted
                                                                                                               EBITDA                                                                EBITDA
Lodging                                                                     $                1,101             $                340               $                1,027             $                296
Vacation Exchange and Rentals                                                                1,604                              380                                1,526                              356
Vacation Ownership                                                                           2,638                              660                                2,515                              621
Total Reportable Segments                                                                    5,343                              1,380                              5,068                              1,273
Corporate and Other                                                                          (62)                               (142)                              (59)                               (121)
Total Company                                                               $                5,281             $                1,238             $                5,009             $                1,152
                                                                                                             Table 2
Wyndham Worldwide Corporation
CONSOLIDATED STATEMENTS OF INCOME
(In millions, except per share data)
                                                        Three Months Ended                    Twelve Months Ended
                                                        December 31,                          December 31,
                                                        2014               2013               2014       2013
Net revenues
                  Service and membership fees           $        508       $        496       $   2,431  $   2,329
                  Vacation ownership interest sales              385                384           1,485      1,379
                  Franchise fees                                 151                139           632        599
                  Consumer financing                             108                108           427        426
                  Other                                          79                 68            306        276
Net revenues                                                     1,231              1,195         5,281      5,009
Expenses
                  Operating                                      542                517           2,262      2,161
                  Cost of vacation ownership interests           42                 48            171        155
                  Consumer financing interest                    18                 18            71         78
                  Marketing and reservation                      188                180           802        751
                  General and administrative                     189                193           755        720
                  Loss on sale and asset impairments             27                 8             35         8
                  Restructuring                                  12                 9             11         10
                  Depreciation and amortization                  58                 56            233        216
Total expenses                                                   1,076              1,029         4,340      4,099
Operating income                                                 155                166           941        910
Other income, net                                                (2)                -             (7)        (6)
Interest expense                                                 29                 34            113        131
Early extinguishment of debt                                     -                  -             -          111
Interest income                                                  (4)                (2)           (10)       (9)
Income before income taxes                                       132                134           845        683
Provision for income taxes                                       51                 48            316        250
Net income                                                       81                 86            529        433
Net income attributable to noncontrolling interest               -                  -             -          (1)
Net income attributable to Wyndham shareholders         $        81        $        86        $   529    $   432
Earnings per share
                  Basic                                 $        0.66      $        0.66      $   4.22   $   3.25
                  Diluted                                        0.65               0.65          4.18       3.21
Weighted average shares outstanding
                  Basic                                          122                129           125        133
                  Diluted                                        124                131           127        135
__________
Note: For a description of adjustments to Net Income, see Table 8.
                                                                                                                                                                  Table 3
                                                                                                                                                                  (1 of 2)
Wyndham Worldwide Corporation
OPERATING STATISTICS
The following operating statistics are the drivers of our revenues and therefore provide an enhanced understanding of our businesses:
                                                                        Year              Q1                Q2                Q3                Q4                Full Year
Lodging
            Number of Rooms                                             2014              646,900           650,200           655,300           660,800           N/A
                                                                        2013              631,800           635,100           638,300           645,400           N/A
                                                                        2012              609,300           608,300           618,100           627,400           N/A
                                                                        2011              609,600           612,900           611,200           613,100           N/A
            RevPAR                                                      2014            $ 32.30           $ 40.11           $ 43.71           $ 34.06           $ 37.57
                                                                        2013            $ 31.05           $ 38.00           $ 41.78           $ 33.07           $ 36.00
                                                                        2012            $ 29.73           $ 37.23           $ 40.39           $ 31.86           $ 34.80
                                                                        2011            $ 27.71           $ 35.38           $ 39.49           $ 30.65           $ 33.34
Vacation Exchange and Rentals
            Average Number of Members (in 000s)                         2014              3,727             3,748             3,777             3,808             3,765
                                                                        2013              3,668             3,686             3,711             3,728             3,698
                                                                        2012              3,684             3,670             3,672             3,670             3,674
                                                                        2011              3,766             3,755             3,744             3,734             3,750
            Exchange Revenue Per Member                                 2014            $ 200.78          $ 179.17          $ 171.77          $ 157.24          $ 177.12
                                                                        2013            $ 210.96          $ 182.42          $ 169.95          $ 161.21          $ 181.02
                                                                        2012            $ 204.56          $ 177.07          $ 171.14          $ 165.86          $ 179.68
                                                                        2011            $ 205.64          $ 178.46          $ 172.38          $ 161.68          $ 179.59
            Vacation Rental Transactions (in 000s) (a)                  2014              429               376               455               293               1,552
                                                                        2013              423               355               433               273               1,483
                                                                        2012              418               325               390               259               1,392
                                                                        2011              398               328               370               250               1,347
            Average Net Price Per Vacation Rental (a)                   2014            $ 410.04          $ 577.13          $ 727.40          $ 492.25          $ 558.95
                                                                        2013            $ 392.64          $ 540.38          $ 677.81          $ 506.62          $ 532.11
                                                                        2012            $ 379.40          $ 524.40          $ 635.44          $ 484.69          $ 504.55
                                                                        2011            $ 377.71          $ 549.09          $ 701.81          $ 497.04          $ 530.78
Vacation Ownership (a)
            Gross Vacation Ownership Interest (VOI) Sales (in 000s) (b) 2014            $ 410,000         $ 496,000         $ 513,000         $ 470,000         $ 1,889,000
                                                                        2013            $ 384,000         $ 481,000         $ 536,000         $ 488,000         $ 1,889,000
                                                                        2012            $ 384,000         $ 460,000         $ 502,000         $ 435,000         $ 1,781,000
                                                                        2011            $ 319,000         $ 412,000         $ 455,000         $ 409,000         $ 1,595,000
            Tours (in 000s) (c)                                         2014              170               208               225               191               794
                                                                        2013              163               206               225               195               789
                                                                        2012              148               186               207               183               724
                                                                        2011              137               177               197               173               685
            Volume Per Guest (VPG) (c)                                  2014            $ 2,272           $ 2,280           $ 2,158           $ 2,336           $ 2,257
                                                                        2013            $ 2,211           $ 2,256           $ 2,278           $ 2,370           $ 2,281
                                                                        2012            $ 2,414           $ 2,361           $ 2,315           $ 2,225           $ 2,324
                                                                        2011            $ 2,192           $ 2,227           $ 2,197           $ 2,296           $ 2,229
Note: Full year amounts may not add across due to rounding.
(a)         Includes the impact of acquisitions from the acquisition dates forward. Therefore, the operating statistics are not presented on a comparable basis.
(b)         Includes Gross VOI sales under the Company’s Wyndham Asset Affiliate Model (WAAM) Just-in-Time beginning in the second quarter of 2012 (see Table 9 for a reconciliation of Gross VOI sales to vacation ownership interest sales).
(c)         Includes the impact of WAAM Just-in-Time related tours beginning in the second quarter of 2012.
ADDITIONAL DATA
                                                                        Year              Q1                Q2                Q3                Q4                Full Year
Lodging
            Number of Properties                                        2014              7,500             7,540             7,590             7,650             N/A
                                                                        2013              7,380             7,410             7,440             7,490             N/A
                                                                        2012              7,150             7,170             7,260             7,340             N/A
                                                                        2011              7,190             7,220             7,190             7,210             N/A
Vacation Ownership
            Provision for Loan Losses (in 000s) (*)                     2014            $ 60,000          $ 70,000          $ 70,000          $ 60,000          $ 260,000
                                                                        2013            $ 84,000          $ 90,000          $ 102,000         $ 73,000          $ 349,000
                                                                        2012            $ 96,000          $ 100,000         $ 124,000         $ 89,000          $ 409,000
                                                                        2011            $ 79,000          $ 80,000          $ 96,000          $ 83,000          $ 339,000
Note: Full year amounts may not add across due to rounding.
(*)         Represents provision for estimated losses on vacation ownership contract receivables originated during the period, which is recorded as a contra revenue to vacation ownership interest sales on the Consolidated Statements of Income.
                                           Table 3
                                           (2 of 2)
Wyndham Worldwide Corporation
OPERATING STATISTICS
GLOSSARY OF TERMS
Lodging
Number of Rooms: Represents the number of rooms at lodging properties at the end of the period which are either (i) under franchise and/or management agreements, or company owned, (ii) properties under affiliation agreements for which the Company receives a fee for reservation and/or other services provided and (iii) properties managed under a joint venture.
Average Occupancy Rate: Represents the percentage of available rooms occupied during the period.
Average Daily Rate (ADR): Represents the average rate charged for renting a lodging room for one day.
RevPAR:  Represents revenue per available room and is calculated by multiplying average occupancy rate by ADR. Comparable RevPAR represents RevPAR of hotels which are included in both periods.
Vacation Exchange and Rentals
Average Number of Members:  Represents members in our vacation exchange programs who paid annual membership dues as of the end of the period or who are within the allowed grace period. For additional fees, such participants are entitled to exchange intervals for intervals at other properties affiliated with the Company’s vacation exchange business. In addition, certain participants may exchange intervals for other leisure-related services and products.
Exchange Revenue Per Member: Represents total annualized revenues generated from fees associated with memberships, exchange transactions, member-related rentals and other servicing for the period divided by the average number of vacation exchange members during the period.
Vacation Rental Transactions:  Represents the number of transactions that are generated during the period in connection with customers booking their vacation rental stays through the Company. One rental transaction is recorded for each standard one-week rental.
Average Net Price Per Vacation Rental: Represents the net rental price generated from renting vacation properties to customers and other related rental servicing fees during the period divided by the number of vacation rental transactions during the period.
Vacation Ownership
Gross Vacation Ownership Interest Sales: Represents sales of vacation ownership interest (VOIs), including WAAM sales, before the net effect of percentage-of-completion accounting and loan loss provisions.  See Table 9 for a reconciliation of Gross VOI sales to vacation ownership interest sales.
Tours: Represents the number of tours taken by guests in our efforts to sell VOIs.
Volume per Guest (VPG): Represents Gross VOI sales (excluding tele-sales upgrades, which are non-tour upgrade sales) divided by the number of tours.  The Company has excluded non-tour upgrade sales in the calculation of VPG because non-tour upgrade sales are generated by a different marketing channel.  See Table 9 for a detail of tele-sales upgrades for 2011-2014.
General
Constant Currency: Represents a comparison eliminating the effects of foreign exchange rate fluctuations between periods (foreign currency translation).
Currency-Neutral: Represents a comparison eliminating the effects of foreign exchange rate fluctuations between periods (foreign currency translation) and the impact caused by any foreign exchange related activities (i.e., hedges, balance sheet remeasurements and/or adjustments).
                                                                                                                                                             Table 4
Wyndham Worldwide Corporation
REVENUE DETAIL BY REPORTABLE SEGMENT
(In millions)
                                                                            2014                                        2013
                                                                                 Q1      Q2      Q3      Q4      Year        Q1      Q2      Q3      Q4      Year
Lodging
                    Royalties and Franchise Fees                            $    68    $ 88    $ 100   $ 83    $ 339    $    64    $ 79    $ 91    $ 75    $ 309
                    Marketing, Reservation and Wyndham Rewards Revenues (a)      76      101     117     91      385         73      92      118     83      365
                    Hotel Management Reimbursable Revenues (b)                   37      39      39      39      154         25      38      37      35      135
                    Intersegment Trademark Fees                                  9       11      11      10      41          8       10      11      10      39
                    Owned Hotel Revenues                                         24      20      18      20      81          26      20      18      19      84
                    Ancillary Revenues (c)                                       23      24      30      24      101         26      23      22      23      95
                    Total Lodging                                                237     283     315     267     1,101       222     262     297     245     1,027
Vacation Exchange and Rentals
                    Exchange Revenues                                            187     168     162     150     667         193     168     158     150     669
                    Rental Revenues                                              176     217     331     144     868         166     192     293     138     789
                    Ancillary Revenues (d)                                       16      17      19      17      69          15      16      19      17      68
                    Total Vacation Exchange and Rentals                          379     402     512     311     1,604       374     376     470     305     1,526
Vacation Ownership
                    Vacation Ownership Interest Sales                            303     382     415     385     1,485       263     347     384     384     1,379
                    Consumer Financing                                           105     106     108     108     427         105     106     107     108     426
                    Property Management Fees                                     143     145     150     142     581         146     141     143     137     567
                    WAAM Fee-for-Service Commissions                             33      30      18      16      98          24      30      33      20      107
                    Ancillary Revenues (e)                                       9       10      13      17      47          11      6       10      9       36
                    Total Vacation Ownership                                     593     673     704     668     2,638       549     630     677     658     2,515
Total Reportable Segments                                                   $    1,209 $ 1,358 $ 1,531 $ 1,246 $ 5,343  $    1,145 $ 1,268 $ 1,444 $ 1,208 $ 5,068
                                                                            2012                                        2011
                                                                                 Q1      Q2      Q3      Q4      Year        Q1      Q2      Q3      Q4      Year
Lodging
                    Royalties and Franchise Fees                            $    62    $ 80    $ 88    $ 71    $ 301    $    58    $ 75    $ 85    $ 66    $ 284
                    Marketing, Reservation and Wyndham Rewards Revenues (a)      68      99      98      80      345         54      75      94      76      299
                    Hotel Management Reimbursable Revenues (b)                   21      22      25      23      91          19      19      21      20      79
                    Intersegment Trademark Fees (f)                              8       9       9       8       34          1       2       3       4       10
                    Owned Hotel Revenues                                         8       8       7       18      41          -       -       -       5       5
                    Ancillary Revenues (c)                                       18      15      22      23      78          17      19      19      17      72
                    Total Lodging                                                185     233     249     223     890         149     190     222     188     749
Vacation Exchange and Rentals
                    Exchange Revenues                                            188     162     157     153     660         194     168     161     150     673
                    Rental Revenues                                              159     170     248     125     702         150     180     260     125     715
                    Ancillary Revenues (d)                                       14      16      15      15      60          12      13      15      16      56
                    Total Vacation Exchange and Rentals                          361     348     420     293     1,422       356     361     436     291     1,444
Vacation Ownership
                    Vacation Ownership Interest Sales                            271     342     373     337     1,323       222     313     320     295     1,150
                    Consumer Financing                                           103     102     106     110     421         102     103     105     105     415
                    Property Management Fees                                     110     108     117     125     460         110     108     105     101     424
                    WAAM Fee-for-Service Commissions                             12      11      4       6       33          10      11      23      21      65
                    Ancillary Revenues (e)                                       5       7       8       12      32          6       6       6       5       23
                    Total Vacation Ownership                                     501     570     608     590     2,269       450     541     559     527     2,077
Total Reportable Segments                                                   $    1,047 $ 1,151 $ 1,277 $ 1,106 $ 4,581  $    955   $ 1,092 $ 1,217 $ 1,006 $ 4,270
Note: Full year amounts may not add across due to rounding.
(a)                 Marketing and reservation revenues represent fees the Company receives from franchised and managed hotels that are to be expended for marketing purposes or the operation of a centralized, brand-specific reservation system.  These fees are typically based on a percentage of the gross room revenues of each hotel.  Wyndham Rewards revenues represent fees the Company receives relating to its loyalty program.
(b)                 Primarily represents payroll costs in the hotel management business that the Company pays on behalf of property owners and for which it is reimbursed by the property owners. During 2014, such amounts include reimbursable revenues of $2 million in each of Q1, Q2 and Q3 and $1 million in Q4 which were charged to the Company’s vacation ownership business and were eliminated in consolidation. During 2013, such amounts include reimbursable revenues of $1 million, $3 million and $2 million, in Q2, Q3 and Q4 respectively, which were charged to the Company’s vacation ownership business and were eliminated in consolidation.
(c)                 Primarily includes additional services provided to franchisees.
(d)                 Primarily includes fees generated from programs with affiliated resorts and homeowners.
(e)                 Primarily includes revenues associated with bonus points/credits that are provided as purchase incentives on VOI sales and fees generated from other non-core operations.
(f)                 During 2011, $3 million, $1 million and $2 million of intersegment trademark fees were recorded as a reduction of expenses in Q1, Q2 and Q3, respectively.  As such, total intersegment trademark fees for 2011 were $16 million.
                                                                                                                                  Table 5
Wyndham Worldwide Corporation
SCHEDULE OF DEBT
(In millions)
                                                                     December 31,   September 30,  June 30,    March 31,   December 31,
                                                                     2014           2014           2014        2014        2013
Securitized vacation ownership debt (a)
Term notes                                                           $      1,962   $      1,670   $    1,600  $    1,823  $      1,648
Bank conduit facility (b)                                                   203            271          291         156           262
Total securitized vacation ownership debt (c)                               2,165          1,941        1,891       1,979         1,910
Less: Current portion of securitized vacation ownership debt                214            192          187         192           184
Long-term securitized vacation ownership debt                        $      1,951   $      1,749   $    1,704  $    1,787  $      1,726
Debt:
Revolving credit facility (due July 2018) (d)                        $      25      $      18      $    16     $    10     $      23
Commercial paper (e)                                                        189            237          107         184           210
$315 million 6.00% senior unsecured notes (due December 2016) (f)           317            317          318         318           318
$300 million 2.95% senior unsecured notes (due March 2017)                  299            299          299         299           298
$14 million 5.75% senior unsecured notes (due February 2018)                14             14           14          14            14
$450 million 2.50% senior unsecured notes (due March 2018)                  448            448          448         447           447
$40 million 7.375% senior unsecured notes (due March 2020)                  40             40           40          40            40
$250 million 5.625% senior unsecured notes (due March 2021)                 247            247          246         246           246
$650 million 4.25% senior unsecured notes (due March 2022) (g)              648            646          646         645           643
$400 million 3.90% senior unsecured notes (due March 2023) (h)              410            401          403         395           387
Capital leases                                                              170            175          186         188           191
Other                                                                       81             80           99          100           114
Total long-term debt                                                        2,888          2,922        2,822       2,886         2,931
Less: Current portion of long-term debt                                     47             49           50          52            49
Long-term debt                                                       $      2,841   $      2,873   $    2,772  $    2,834  $      2,882
__________
(a) The Company’s vacation ownership contract receivables are securitized through bankruptcy-remote special purpose entities ("SPEs") that are consolidated within our financial statements. These bankruptcy-remote SPEs are legally separate from the Company. The receivables held by the bankruptcy-remote SPEs are not available to the Company’s creditors and legally are not the Company’s assets. Additionally, the creditors of these SPEs have no recourse to the Company for principal and interest.
(b) Represents a non-recourse vacation ownership bank conduit facility with a term through August 2016 and borrowing capacity of $650 million. As of December 31, 2014, this facility had a remaining borrowing capacity of $447 million.
(c) This debt is collateralized by $2,629 million, $2,326 million, $2,287 million, $2,328 million and $2,314 million of underlying vacation ownership contract receivables and related assets as of December 31, 2014, September 30, 2014, June 30, 2014, March 31, 2014 and December 31, 2013, respectively.
(d) Represents a $1.5 billion revolving credit facility that expires in July 2018. As of December 31, 2014, the Company had $2 million of outstanding letters of credit. After considering outstanding commercial paper borrowings of $189 million, the remaining borrowing capacity was $1.3 billion as of December 31, 2014.
(e) Represents commercial paper programs of $1.25 billion with a remaining borrowing capacity of $1.1 billion, as of December 31, 2014.
(f) Includes unamortized gains from the settlement of a derivative in the amount of $2 million as of December 31, 2014 and September 30, 2014, respectively, and $3 million as of June 30, 2014, March 31, 2014 and December 31, 2013, respectively.
(g) Includes a $3 million increase and $2 million decrease in the carrying value resulting from a fair value hedge derivative as of December 31, 2014 and December 31, 2013, respectively.
(h) Includes a $13 million increase and $10 million decrease in the carrying value resulting from a fair value hedge derivative as of December 31, 2014 and December 31, 2013, respectively.
                                                                                                                                      Table 6
                                                                                                                                      (1 of 2)
Wyndham Worldwide Corporation
BRAND SYSTEM DETAILS
                                              As of and For the Three Months Ended December 31, 2014
Brand                                         Number of             Number of Rooms       Average               Average Daily         Average Revenue
                                              Properties                                  Occupancy Rate        Rate (ADR)            Per Available
                                                                                                                                      Room (RevPAR)
Lodging
Wyndham Hotels and Resorts                    195                   43,865                58.0%                 $116.50               $67.53
TRYP by Wyndham                               119                   16,965                59.5%                 $84.73                $50.44
Wingate by Wyndham                            153                   13,923                58.2%                 $84.83                $49.35
Hawthorn Suites by Wyndham                    97                    9,620                 63.1%                 $75.65                $47.72
Ramada                                        837                   115,923               51.1%                 $78.04                $39.86
Baymont                                       369                   29,727                47.1%                 $64.64                $30.42
Days Inn                                      1,794                 145,078               45.7%                 $63.86                $29.18
Super 8                                       2,510                 160,847               53.8%                 $48.07                $25.85
Howard Johnson                                429                   45,919                46.7%                 $62.82                $29.34
Travelodge                                    421                   30,989                45.0%                 $63.71                $28.68
Microtel Inns & Suites by Wyndham             323                   23,138                56.1%                 $67.28                $37.74
Knights Inn                                   398                   24,832                42.1%                 $45.61                $19.19
                      Total Lodging           7,645                 660,826               50.6%                 $67.27                $34.06
Vacation Ownership
Wyndham Vacation Ownership resorts            203                   23,644                N/A                   N/A                   N/A
                      Total Wyndham Worldwide 7,848                 684,470
                                              As of and For the Three Months Ended December 31, 2013
Brand                                         Number of             Number of Rooms       Average               Average Daily         Average Revenue
                                              Properties                                  Occupancy Rate        Rate (ADR)            Per Available
                                                                                                                                      Room (RevPAR)
Lodging
Wyndham Hotels and Resorts                    170                   37,569                54.5%                 $120.69               $65.76
TRYP by Wyndham                               113                   16,216                57.4%                 $97.16                $55.74
Wingate by Wyndham                            159                   14,559                56.0%                 $83.38                $46.66
Hawthorn Suites by Wyndham                    91                    8,933                 59.2%                 $69.39                $41.10
Ramada                                        834                   115,394               50.9%                 $80.82                $41.13
Baymont                                       329                   27,108                46.0%                 $62.11                $28.60
Days Inn                                      1,817                 146,959               44.3%                 $62.20                $27.54
Super 8                                       2,391                 152,648               52.2%                 $49.36                $25.77
Howard Johnson                                449                   46,777                45.8%                 $59.86                $27.39
Travelodge                                    432                   32,012                44.2%                 $63.13                $27.91
Microtel Inns & Suites by Wyndham             312                   22,304                53.7%                 $63.53                $34.11
Knights Inn                                   380                   23,325                40.0%                 $43.43                $17.37
Dream                                         5                     989                   74.6%                 $249.45               $186.05
Night                                         3                     630                   63.3%                 $172.81               $109.40
                      Total Lodging           7,485                 645,423               49.1%                 $67.36                $33.07
Vacation Ownership
Wyndham Vacation Ownership resorts            191                   23,506                N/A                   N/A                   N/A
                      Total Wyndham Worldwide 7,676                 668,929
_______________
NOTE: A glossary of terms is included in Table 3 (2 of 2); RevPAR may not recalculate by multiplying average occupancy rate by ADR due to rounding.
                                                                                                                                      Table 6
                                                                                                                                      (2 of 2)
Wyndham Worldwide Corporation
BRAND SYSTEM DETAILS
                                              As of and For the Year Ended December 31, 2014
Brand                                         Number of             Number of Rooms       Average               Average Daily         Average Revenue
                                              Properties                                  Occupancy Rate        Rate (ADR)            Per Available
                                                                                                                                      Room (RevPAR)
Lodging
Wyndham Hotels and Resorts                    195                   43,865                61.8%                 $115.17               $71.14
TRYP by Wyndham                               119                   16,965                61.9%                 $90.45                $55.97
Wingate by Wyndham                            153                   13,923                63.6%                 $86.61                $55.05
Hawthorn Suites by Wyndham                    97                    9,620                 65.5%                 $76.59                $50.19
Ramada                                        837                   115,923               54.2%                 $79.70                $43.22
Baymont                                       369                   29,727                52.5%                 $65.75                $34.51
Days Inn                                      1,794                 145,078               51.0%                 $65.68                $33.48
Super 8                                       2,510                 160,847               57.2%                 $50.86                $29.09
Howard Johnson                                429                   45,919                48.8%                 $63.46                $30.96
Travelodge                                    421                   30,989                51.1%                 $67.75                $34.62
Microtel Inns & Suites by Wyndham             323                   23,138                59.8%                 $67.26                $40.23
Knights Inn                                   398                   24,832                44.9%                 $46.67                $20.94
                      Total Lodging           7,645                 660,826               54.5%                 $68.94                $37.57
Vacation Ownership
Wyndham Vacation Ownership resorts            203                   23,644                N/A                   N/A                   N/A
                      Total Wyndham Worldwide 7,848                 684,470
                                              As of and For the Year Ended December 31, 2013
Brand                                         Number of             Number of Rooms       Average               Average Daily         Average Revenue
                                              Properties                                  Occupancy Rate        Rate (ADR)            Per Available
                                                                                                                                      Room (RevPAR)
Lodging
Wyndham Hotels and Resorts                    170                   37,569                58.6%                 $117.27               $68.74
TRYP by Wyndham                               113                   16,216                60.5%                 $96.09                $58.16
Wingate by Wyndham                            159                   14,559                60.9%                 $85.11                $51.82
Hawthorn Suites by Wyndham                    91                    8,933                 62.6%                 $71.46                $44.71
Ramada                                        834                   115,394               53.0%                 $80.19                $42.50
Baymont                                       329                   27,108                51.3%                 $63.14                $32.40
Days Inn                                      1,817                 146,959               48.8%                 $64.34                $31.42
Super 8                                       2,391                 152,648               56.3%                 $52.33                $29.45
Howard Johnson                                449                   46,777                47.7%                 $62.06                $29.58
Travelodge                                    432                   32,012                49.5%                 $67.10                $33.23
Microtel Inns & Suites by Wyndham             312                   22,304                57.6%                 $64.42                $37.10
Knights Inn                                   380                   23,325                42.0%                 $45.04                $18.92
Dream                                         5                     989                   71.8%                 $229.77               $164.88
Night                                         3                     630                   62.4%                 $152.65               $95.18
                      Total Lodging           7,485                 645,423               52.7%                 $68.27                $36.00
Vacation Ownership
Wyndham Vacation Ownership resorts            191                   23,506                N/A                   N/A                   N/A
                      Total Wyndham Worldwide 7,676                 668,929
_______________
NOTE: A glossary of terms is included in Table 3 (2 of 2); RevPAR may not recalculate by multiplying average occupancy rate by ADR due to rounding.
                                                                                                                                                                     Table 7
                                                                                                                                                                     (1 of 2)
Wyndham Worldwide Corporation
NON-GAAP RECONCILIATION
(In millions)
Three months ended March 31, 2014      Net Revenues   Reported       Executive Venezuela        VAT            Restructuring  Loss on Sale     Legacy           Adjusted
                                                      EBITDA         Departure Currency         Adjustment(c)  Costs(d)       and Asset        Adjustments(f)   EBITDA
                                                                     Costs     Devaluation(b)                                 Impairments(e)
Lodging                                $      237     $      64      $      4  $       -        $      -       $      -       $       -        $       -        $    68
Vacation Exchange and Rentals                 379            85             -          10              -              -               -                -             95
Vacation Ownership                            593            115            -          -               -              -               -                -             115
Total Reportable Segments                     1,209          264            4          10              -              -               -                -             278
Corporate and Other (a)                       (16)           (34)           -          -               -              -               -                -             (34)
Total Company                          $      1,193   $      230     $      4  $       10       $      -       $      -       $       -        $       -        $    244
Three months ended June 30, 2014
Lodging                                $      283     $      87      $      -  $       -        $      -       $      -       $       -        $       -        $    87
Vacation Exchange and Rentals                 402            89             -          -               (2)            -               -                -             87
Vacation Ownership                            673            185            -          -               -              -               -                -             185
Total Reportable Segments                     1,358          361            -          -               (2)            -               -                -             359
Corporate and Other (a)                       (15)           (35)           -          -               -              -               -                -             (35)
Total Company                          $      1,343   $      326     $      -  $       -        $      (2)     $      -       $       -        $       -        $    324
Three months ended September 30, 2014
Lodging                                $      315     $      100     $      -  $       -        $      -       $      (1)     $       8        $       -        $    107
Vacation Exchange and Rentals                 512            159            -          -               -              -               -                -             159
Vacation Ownership                            704            188            -          -               -              -               -                -             188
Total Reportable Segments                     1,531          447            -          -               -              (1)             8                -             454
Corporate and Other (a)                       (17)           (36)           -          -               -              -               -                -             (36)
Total Company                          $      1,514   $      411     $      -  $       -        $      -       $      (1)     $       8        $       -        $    418
Three months ended December 31, 2014
Lodging                                $      267     $      77      $      -  $       -        $      -       $      2       $       -        $       -        $    79
Vacation Exchange and Rentals                 311            2              -          -               -              10              27               -             39
Vacation Ownership                            668            172            -          -               -              -               -                -             172
Total Reportable Segments                     1,246          251            -          -               -              12              27               -             290
Corporate and Other (a)                       (15)           (36)           -          -               -              -               -                (2)           (38)
Total Company                          $      1,231   $      215     $      -  $       -        $      -       $      12      $       27       $       (2)      $    252
Twelve months ended December 31, 2014
Lodging                                $      1,101   $      327     $      4  $       -        $      -       $      1       $       8        $       -        $    340
Vacation Exchange and Rentals                 1,604          335            -          10              (2)            10              27               -             380
Vacation Ownership                            2,638          660            -          -               -              -               -                -             660
Total Reportable Segments                     5,343          1,322          4          10              (2)            11              35               -             1,380
Corporate and Other (a)                       (62)           (141)          -          -               -              -               -                (1)           (142)
Total Company                          $      5,281   $      1,181   $      4  $       10       $      (2)     $      11      $       35       $       (1)      $    1,238
________________
Note: The sum of the quarters may not agree to the twelve months ended December 31, 2014 due to rounding.
(a) Includes the elimination of transactions between segments.
(b) Represents the devaluation of the official exchange rate of Venezuela.
(c) Reversal of a reserve for value-added taxes.
(d) Relates to (i) the reversal of a portion of a restructuring reserve established during the fourth quarter of 2013 and (ii) costs incurred as a result of various organizational realignment initiatives by the Company.
(e) Relates to (i) a loss on the sale of a business and a write-down of an equity investment at the Company’s vacation exchange and rentals business and (ii) a write-down of an investment in a joint venture at the Company’s lodging business.
(f) Relates to the net benefit from the resolution of and adjustment to certain contingent liabilities and assets resulting from our separation from Cendant.
                                                                                                                                   Table 7
                                                                                                                                   (2 of 2)
Wyndham Worldwide Corporation
NON-GAAP RECONCILIATION
(In millions)
Three months ended March 31, 2013     Net Revenues   Reported    Legacy           Acquisition  Restructuring  Asset           Adjusted
                                                     EBITDA      Adjustments (b)  Costs (c)    Costs (d)      Impairment (e)  EBITDA
Lodging                               $      222     $    58     $       -        $     -      $      -       $       -       $    58
Vacation Exchange and Rentals                374          94             -              -             -               -            94
Vacation Ownership                           549          111            -              2             -               -            113
Total Reportable Segments                    1,145        263            -              2             -               -            265
Corporate and Other (a)                      (12)         (29)           -              -             -               -            (29)
Total Company                         $      1,133   $    234    $       -        $     2      $      -       $       -       $    236
Three months ended June 30, 2013
Lodging                               $      262     $    78     $       -        $     -      $      -       $       -       $    78
Vacation Exchange and Rentals                376          85             -              -             -               -            85
Vacation Ownership                           630          161            -              -             -               -            161
Total Reportable Segments                    1,268        324            -              -             -               -            324
Corporate and Other (a)                      (15)         (27)           -              -             -               -            (27)
Total Company                         $      1,253   $    297    $       -        $     -      $      -       $       -       $    297
Three months ended September 30, 2013
Lodging                               $      297     $    95     $       -        $     -      $      -       $       -       $    95
Vacation Exchange and Rentals                470          141            -              -             -               -            141
Vacation Ownership                           677          176            -              -             -               -            176
Total Reportable Segments                    1,444        412            -              -             -               -            412
Corporate and Other (a)                      (17)         (33)           (1)            -             -               -            (34)
Total Company                         $      1,427   $    379    $       (1)      $     -      $      -       $       -       $    378
Three months ended December 31, 2013
Lodging                               $      245     $    47     $       -        $     -      $      9       $       8       $    64
Vacation Exchange and Rentals                305          36             -              -             -               -            36
Vacation Ownership                           658          172            -              -             -               -            172
Total Reportable Segments                    1,208        255            -              -             9               8            272
Corporate and Other (a)                      (13)         (33)           -              -             -               -            (33)
Total Company                         $      1,195   $    222    $       -        $     -      $      9       $       8       $    239
Twelve months ended December 31, 2013
Lodging                               $      1,027   $    279    $       -        $     -      $      9       $       8       $    296
Vacation Exchange and Rentals                1,526        356            -              -             -               -            356
Vacation Ownership                           2,515        619            -              2             -               -            621
Total Reportable Segments                    5,068        1,254          -              2             9               8            1,273
Corporate and Other (a)                      (59)         (122)          1              -             -               -            (121)
Total Company                         $      5,009   $    1,132  $       1        $     2      $      9       $       8       $    1,152
________________
Note: The sum of the quarters may not agree to the twelve months ended December 31, 2013 due to rounding.
(a) Includes the elimination of transactions between segments.
(b) Relates to a net (benefit)/expense from the resolution of and adjustment to certain contingent liabilities and assets resulting from the Company’s separation from Cendant.
(c) Relates to costs incurred in connection with the acquisition of Midtown 45, a NYC property (January 2013).
(d) Relates to costs incurred as a result of an organizational realignment initiative.
(e) Relates primarily to a non-cash impairment charge from a partial write-down of the Hawthorn trademark.
                                                                                                                                                                                                                                                                                      Table 8
                                                                                                                                                                                                                                                                                      (1 of 4)
Wyndham Worldwide Corporation
NON-GAAP FINANCIAL INFORMATION
(In millions, except per share data)
                                                                           Three Months Ended December 31, 2014
                                                                           As Reported                         Legacy                                                        Restructuring                         Loss on Sale                          As Adjusted
                                                                                                               Adjustments(a)                                                Costs (c)                             and Asset                             non-GAAP
                                                                                                                                                                                                                   Impairment (d)
Net revenues
                             Service and membership fees                   $                            508    $                                                             $                                     $                                     $                            508
                             Vacation ownership interest sales                                          385                                                                                                                                                                           385
                             Franchise fees                                                             151                                                                                                                                                                           151
                             Consumer financing                                                         108                                                                                                                                                                           108
                             Other                                                                      79                                                                                                                                                                            79
Net revenues                                                                                            1,231                               -                                                             -                                     -                                     1,231
Expenses
                             Operating                                                                  542                                                                                                                                                                           542
                             Cost of vacation ownership interests                                       42                                                                                                                                                                            42
                             Consumer financing interest                                                18                                                                                                                                                                            18
                             Marketing and reservation                                                  188                                                                                                                                                                           188
                             General and administrative                                                 189                                 2                                                                                                                                         191
                             Loss on sale and asset impairment                                          27                                                                                                                                      (27)                                  -
                             Restructuring                                                              12                                                                                                (12)                                                                        -
                             Depreciation and amortization                                              58                                                                                                                                                                            58
Total expenses                                                                                          1,076                               2                                                             (12)                                  (27)                                  1,039
Operating income                                                                                        155                                 (2)                                                           12                                    27                                    192
Other income, net                                                                                       (2)                                                                                                                                                                           (2)
Interest expense                                                                                        29                                                                                                                                                                            29
Interest income                                                                                         (4)                                                                                                                                                                           (4)
Income before income taxes                                                                              132                                 (2)                                                           12                                    27                                    169
Provision for income taxes                                                                              51                                  (1)                          (b)                              4    (b)                              3    (b)                              57
Net income attributable to Wyndham shareholders                            $                            81     $                            (1)                              $                            8        $                            24       $                            112
Earnings per share
                             Basic                                         $                            0.66   $                            (0.01)                           $                            0.07     $                            0.20     $                            0.91
                             Diluted                                                                    0.65                                (0.01)                                                        0.06                                  0.20                                  0.90
Weighted average shares outstanding
                             Basic                                                                      122                                 122                                                           122                                   122                                   122
                             Diluted                                                                    124                                 124                                                           124                                   124                                   124
__________
The above table reconciles certain non-GAAP financial measures.  The presentation of these adjustments is intended to permit the comparison of particular adjustments as they appear in the line items of the income statement in order to assist investors’ understanding of the overall impact of such adjustments.  This non-GAAP reconciliation table should not be considered a substitute for, nor superior to, financial results and measures determined or calculated in accordance with GAAP.
Note:                        EPS amounts may not add due to rounding.
(a)                          Relates to the net benefit from the resolution of and adjustment to certain contingent liabilities and assets resulting from our separation from Cendant.
(b)                          Relates to the tax effect of the adjustment.
(c)                          Relates to costs incurred as a result of organizational realignment initiatives at the Company’s lodging and vacation exchange and rentals businesses.
(d)                          Relates to a loss on the sale of a business and a write-down of an equity investment at the Company’s vacation exchange and rentals business.
                                                                                                                                                                                                                                                                                                                                                                                                 Table 8
                                                                                                                                                                                                                                                                                                                                                                                                 (2 of 4)
Wyndham Worldwide Corporation
NON-GAAP FINANCIAL INFORMATION
(In millions, except per share data)
                                                                           Twelve Months Ended December 31, 2014
                                                                           As Reported                            Executive                                 Venezuela                                 Legacy                                    VAT                                       Restructuring                             Loss on Sale                              As Adjusted
                                                                                                                  Departure                                 Currency                                  Adjustments(d)                            Adjustment(f)                             Costs(g)                                  and Asset                                 non-GAAP
                                                                                                                  Costs (a)                                 Devaluation(c)                                                                                                                                                          Impairments(h)
Net revenues
                          Service and membership fees                      $                  2,431               $                                         $                                         $                                         $                                         $                                         $                                         $                  2,431
                          Vacation ownership interest sales                                   1,485                                                                                                                                                                                                                                                                                              1,485
                          Franchise fees                                                      632                                                                                                                                                                                                                                                                                                632
                          Consumer financing                                                  427                                                                                                                                                                                                                                                                                                427
                          Other                                                               306                                                                                                                                                                                                                                                                                                306
Net revenues                                                                                  5,281                                  -                                         -                                         -                                         -                                         -                                         -                                         5,281
Expenses
                          Operating                                                           2,262                                                                            (10)                                                                                                                                                                                                              2,252
                          Cost of vacation ownership interests                                171                                                                                                                                                                                                                                                                                                171
                          Consumer financing interest                                         71                                                                                                                                                                                                                                                                                                 71
                          Marketing and reservation                                           802                                                                                                                                                                                                                                                                                                802
                          General and administrative                                          755                                    (4)                                                                                 1                                         2                                                                                                                             754
                          Loss on sale and asset impairments                                  35                                                                                                                                                                                                                                                       (35)                                      -
                          Restructuring                                                       11                                                                                                                                                                                                             (11)                                                                                -
                          Depreciation and amortization                                       233                                                                                                                                                                                                                                                                                                233
Total expenses                                                                                4,340                                  (4)                                       (10)                                      1                                         2                                         (11)                                      (35)                                      4,283
Operating income                                                                              941                                    4                                         10                                        (1)                                       (2)                                       11                                        35                                        998
Other income, net                                                                             (7)                                                                                                                                                                                                                                                                                                (7)
Interest expense                                                                              113                                                                                                                                                                  2                                                                                                                             115
Interest income                                                                               (10)                                                                                                                                                                                                                                                                                               (10)
Income before income taxes                                                                    845                                    4                                         10                                        (1)                                       (4)                                       11                                        35                                        900
Provision for income taxes                                                                    316                                    1                  (b)                    1                  (b)                    1                  (e)                    (2)                (b)                    4                  (b)                    6                  (b)                    327
Net income                                                                                    529                                    3                                         9                                         (2)                                       (2)                                       7                                         29                                        573
Net income attributable to noncontrolling interest                                            -                                      -                                         -                                         -                                         -                                         -                                         -                                         -
Net income attributable to Wyndham shareholders                            $                  529                 $                  3                      $                  9                      $                  (2)                    $                  (2)                    $                  7                      $                  29                     $                  573
Earnings per share
                          Basic                                            $                  4.22                $                  0.02                   $                  0.07                   $                  (0.01)                 $                  (0.02)                 $                  0.06                   $                  0.23                   $                  4.57
                          Diluted                                                             4.18                                   0.02                                      0.07                                      (0.01)                                    (0.02)                                    0.06                                      0.23                                      4.53
Weighted average shares outstanding
                          Basic                                                               125                                    125                                       125                                       125                                       125                                       125                                       125                                       125
                          Diluted                                                             127                                    127                                       127                                       127                                       127                                       127                                       127                                       127
__________
The above table reconciles certain non-GAAP financial measures.  The presentation of these adjustments is intended to permit the comparison of particular adjustments as they appear in the line items of the income statement in order to assist investors’ understanding of the overall impact of such adjustments.  This non-GAAP reconciliation table should not be considered a substitute for, nor superior to, financial results and measures determined or calculated in accordance with GAAP.
Note: EPS amounts may not add due to rounding.
(a)                       Related to costs associated with an executive’s departure at the Company’s lodging business.
(b)                       Relates to the tax effect of the adjustment.
(c)                       Represents the devaluation of the official exchange rate of Venezuela at the Company’s vacation exchange and rentals business.
(d)                       Relates to the net benefit from the resolution of and adjustment to certain contingent liabilities and assets resulting from our separation from Cendant.
(e)                       Relates to the reversal of a state tax accrual.
(f)                       Relates to the reversal of a reserve for value-added taxes at the Company’s vacation exchange and rentals business.
(g)                       Relates to (i) costs incurred as a result of organizational realignment initiatives at the Company’s lodging and vacation exchange and rentals businesses, partially offset by (ii) the reversal of a portion of a restructuring reserve of $1 million established during the fourth quarter of 2013.
(h)                       Relates to (i) a loss on the sale of a business and a write-down of an equity investment at the Company’s vacation exchange and rentals business and (ii) a write-down of an investment in a joint venture at the Company’s lodging business.
                                                                                                                                                                                                                                              Table 8
                                                                                                                                                                                                                                              (3 of 4)
Wyndham Worldwide Corporation
NON-GAAP FINANCIAL INFORMATION
(In millions, except per share data)
                                                                         Three Months Ended December 31, 2013
                                                                         As Reported                               Restructuring                               Asset                                       As Adjusted
                                                                                                                   Costs(a)                                    Impairment(b)                               non-GAAP
Net revenues
                                   Service fees and membership           $                                  496    $                                           $                                           $                                  496
                                   Vacation ownership interest sales                                        384                                                                                                                               384
                                   Franchise fees                                                           139                                                                                                                               139
                                   Consumer financing                                                       108                                                                                                                               108
                                   Other                                                                    68                                                                                                                                68
Net revenues                                                                                                1,195                                     -                                           -                                           1,195
Expenses
                                   Operating                                                                517                                                                                                                               517
                                   Cost of vacation ownership interests                                     48                                                                                                                                48
                                   Consumer financing interest                                              18                                                                                                                                18
                                   Marketing and reservation                                                180                                                                                                                               180
                                   General and administrative                                               193                                                                                                                               193
                                   Loss on sale and asset impairments                                       8                                                                                     (8)                                         -
                                   Restructuring                                                            9                                         (9)                                                                                     -
                                   Depreciation and amortization                                            56                                                                                                                                56
Total expenses                                                                                              1,029                                     (9)                                         (8)                                         1,012
Operating income                                                                                            166                                       9                                           8                                           183
Interest expense                                                                                            34                                                                                                                                34
Interest income                                                                                             (2)                                                                                                                               (2)
Income before income taxes                                                                                  134                                       9                                           8                                           151
Provision for income taxes                                                                                  48                                        4    (c)                                    3    (c)                                    55
Net income attributable to Wyndham shareholders                          $                                  86     $                                  5        $                                  5        $                                  96
Earnings per share
                                   Basic                                 $                                  0.66   $                                  0.04                                        0.04     $                                  0.74
                                   Diluted                                                                  0.65                                      0.04                                        0.04                                        0.73
Weighted average shares outstanding
                                   Basic                                                                    129                                       129                                         129                                         129
                                   Diluted                                                                  131                                       131                                         131                                         131
__________
The above table reconciles certain non-GAAP financial measures.  The presentation of these adjustments is intended to permit the comparison of particular adjustments as they appear in the line items of the income statement in order to assist investors’ understanding of the overall impact of such adjustments.  This non-GAAP reconciliation table should not be considered a substitute for, nor superior to, financial results and measures determined or calculated in accordance with GAAP.
(a)                                Relates to costs incurred as a result of an organizational realignment initiative at the Company’s lodging business.
(b)                                Relates primarily to a non-cash impairment charge from a partial write-down of the Hawthorn trademark at the Company’s lodging business.
(c)                                Relates to the tax effect of the adjustment.
                                                                                                                                                                                                                                                                                                              Table 8
                                                                                                                                                                                                                                                                                                              (4 of 4)
Wyndham Worldwide Corporation
NON-GAAP FINANCIAL INFORMATION
(In millions, except per share data)
                                                               Twelve Months Ended December 31, 2013
                                                               As Reported                                  Legacy                         Acquisition                    Early                                           Restructuring                  Asset                          As Adjusted
                                                                                                            Adjustments(a)                 Costs(c)                       Extinguishment                                  Costs (f)                      Impairment(g)                  non-GAAP
                                                                                                                                                                          of Debt (e)
Net revenues
                         Service fees and membership           $                     2,329                  $                              $                              $                                               $                              $                              $                     2,329
                         Vacation ownership interest sales                           1,379                                                                                                                                                                                                                    1,379
                         Franchise fees                                              599                                                                                                                                                                                                                      599
                         Consumer financing                                          426                                                                                                                                                                                                                      426
                         Other                                                       276                                                                                                                                                                                                                      276
Net revenues                                                                         5,009                                        -                              -                              -                                               -                              -                              5,009
Expenses
                         Operating                                                   2,161                                                                       (2)                                                                                                                                          2,159
                         Cost of vacation ownership interests                        155                                                                                                                                                                                                                      155
                         Consumer financing interest                                 78                                                                                                                                                                                                                       78
                         Marketing and reservation                                   751                                                                                                                                                                                                                      751
                         General and administrative                                  720                                          (1)                                                                                                                                                                         719
                         Loss on sale and asset impairments                          8                                                                                                                                                                                         (8)                            -
                         Restructuring                                               10                                                                                                                                                         (9)                                                           1
                         Depreciation and amortization                               216                                                                                                                                                                                                                      216
Total expenses                                                                       4,099                                        (1)                            (2)                            -                                               (9)                            (8)                            4,079
Operating income                                                                     910                                          1                              2                              -                                               9                              8                              930
Other income, net                                                                    (6)                                                                                                                                                                                                                      (6)
Interest expense                                                                     131                                                                                                                                                                                                                      131
Early extinguishment of debt                                                         111                                                                                                        (111)                                                                                                         -
Interest income                                                                      (9)                                                                                                                                                                                                                      (9)
Income before income taxes                                                           683                                          1                              2                              111                                             9                              8                              814
Provision for income taxes                                                           250                                          (2)  (b)                       1    (d)                       42                    (d)                       4    (d)                       3    (d)                       298
Net income                                                                           433                                          3                              1                              69                                              5                              5                              516
Net loss attributable to noncontrolling interest                                     (1)                                          -                              -                              -                                               -                              -                              (1)
Net income attributable to Wyndham shareholders                $                     432                    $                     3        $                     1        $                     69                        $                     5        $                     5        $                     515
Earnings per share
                         Basic                                 $                     3.25                   $                     0.02     $                     0.01     $                     0.51                      $                     0.04     $                     0.04     $                     3.87
                         Diluted                                                     3.21                                         0.02                           0.01                           0.51                                            0.04                           0.04                           3.83
Weighted average shares outstanding
                         Basic                                                       133                                          133                            133                            133                                             133                            133                            133
                         Diluted                                                     135                                          135                            135                            135                                             135                            135                            135
__________
The above table reconciles certain non-GAAP financial measures.  The presentation of these adjustments is intended to permit the comparison of particular adjustments as they appear in the line items of the income statement in order to assist investors’ understanding of the overall impact of such adjustments.  This non-GAAP reconciliation table should not be considered a substitute for, nor superior to, financial results and measures determined or calculated in accordance with GAAP.
Note: EPS amounts may not add due to rounding.
(a)                      Relates to the net expense from the resolution of and adjustment to certain contingent liabilities and assets resulting from our separation from Cendant.
(b)                      Relates to a state tax accrual for legacy tax matters.
(c)                      Relates to the costs incurred in connection with the acquisition of Midtown 45, a NYC property (January 2013) at the Company’s vacation ownership business.
(d)                      Relates to the tax effect of the adjustment.
(e)                      Represents costs incurred for the early repurchase of a portion of the Company’s 7.375%, 5.75% and 6.00% senior unsecured notes and the remaining portion of the 9.875% senior unsecured notes.
(f)                      Relates to costs incurred as a result of an organizational realignment initiative at the Company’s lodging business.
(g)                      Relates primarily to a non-cash impairment charge from a partial write-down of the Hawthorn trademark at the Company’s lodging business.
                                                                                                                                                                                 Table 9
Wyndham Worldwide Corporation
NON-GAAP RECONCILIATIONS AND FINANCIAL INFORMATION
(In millions)
FREE CASH FLOW
We define free cash flow to be net cash provided by operating activities less property and equipment additions which we also refer to as capital expenditures.
We believe free cash flow to be a useful operating performance measure to evaluate the ability of our operations to generate cash for uses other than capital expenditures and, after debt service and other obligations, our ability to grow our business through acquisitions, development advances and equity investments, as well as our ability to return cash to shareholders through dividends and share repurchases. A limitation of using free cash flow versus the GAAP measure of net cash provided by operating activities, net cash used in investing activities and net cash used in financing activities as a means for evaluating Wyndham Worldwide is that free cash flow does not represent the total cash movement for the period as detailed in the consolidated statement of cash flows.
The following table provides more details on the GAAP financial measure that is most directly comparable to the non-GAAP financial measure and the related reconciliation between these financial measures:
                                                                   Twelve Months Ended December 31,
                                                                   2014                                                                             2013
Net cash provided by operating activities                          $                                                                 984            $    1,008
Less: Property and equipment additions                                                                                               (235)               (238)
Free cash flow                                                     $                                                                 749            $    770
GROSS VOI SALES
The following table provides a reconciliation of Gross VOI sales (see Table 3) to vacation ownership interest sales (see Table 4):
Year
2014                                                               Q1                                                                      Q2       Q3         Q4      Full Year
Gross VOI sales (a)                                                $                                                                 410   $  496   $    513   $  470  $         1,889
Less: Sales under WAAM Fee-for-Service                                                                                               (44)     (40)       (27)     (21)           (132)
Gross VOI sales, net of WAAM Fee-for-Service sales                                                                                   366      456        486      449            1,757
Less: Loan loss provision                                                                                                            (60)     (70)       (70)     (60)           (260)
Less: Impact of percentage-of-completion accounting                                                                                  (3)      (4)        (1)      (4)            (12)
Vacation ownership interest sales (a)                              $                                                                 303   $  382   $    415   $  385  $         1,485
2013
Gross VOI sales (a)                                                $                                                                 384   $  481   $    536   $  488  $         1,889
Less: Sales under WAAM Fee-for-Service                                                                                               (36)     (44)       (51)     (29)           (160)
Gross VOI sales, net of WAAM Fee-for-Service sales                                                                                   347      437        486      459            1,729
Less: Loan loss provision                                                                                                            (84)     (90)       (102)    (73)           (349)
Less: Impact of percentage of completion accounting                                                                                  -        -          -        (1)            (1)
Vacation ownership interest sales (a)                              $                                                                 263   $  347   $    384   $  384  $         1,379
2012
Gross VOI sales (a)                                                $                                                                 384   $  460   $    502   $  435  $         1,781
Less: Sales under WAAM Fee-for-Service                                                                                               (17)     (18)       (5)      (10)           (49)
Gross VOI sales, net of WAAM Fee-for-Service sales                                                                                   367      442        497      426            1,732
Less: Loan loss provision                                                                                                            (96)     (100)      (124)    (89)           (409)
Vacation ownership interest sales (a)                              $                                                                 271   $  342   $    373   $  337  $         1,323
2011
Gross VOI sales                                                    $                                                                 319   $  412   $    455   $  409  $         1,595
Less: Sales under WAAM Fee-for-Service                                                                                               (18)     (19)       (38)     (31)           (106)
Gross VOI sales, net of WAAM Fee-for-Service sales                                                                                   302      393        417      378            1,489
Less: Loan loss provision                                                                                                            (79)     (80)       (96)     (83)           (339)
Vacation ownership interest sales                                  $                                                                 222   $  313   $    320   $  295  $         1,150
_____________
Note: Amounts may not add due to rounding.
(a)  Includes VOI sales under WAAM Just-in-Time beginning in the second quarter of 2012.
The following includes primarily tele-sales upgrades and other non-tour revenues, which are excluded from Gross VOI sales in the Company’s VPG calculation (see Table 3):
                                                                   Q1                                                                      Q2       Q3         Q4      Full Year
2014                                                               $                                                                 25    $  21    $    27    $  24   $         97
2013                                                               $                                                                 24    $  18    $    22    $  25   $         89
2012                                                               $                                                                 27    $  20    $    22    $  28   $         97
2011                                                               $                                                                 18    $  18    $    21    $  11   $         68

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SOURCE Wyndham Worldwide Corporation

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