Photo shows a vacation scene from the website of Marriott Vacations Worldwide, a timeshare company.(Photo: Marriott Vacations Worldwide)
Shares of Marriott Vacations Worldwide (VAC) plunged Thursday after the timeshare company reported quarterly earnings and revenue that missed Wall Street expectations and cut its forecast for full-year contract sales growth.
Orlando, Fla.-based Marriott Vacations' closed down more than 15% at $62.93 per share after the company reported its third-quarter revenues totaled $407.1 million, down 1.4% from the $413,038 for the same period last year.
Third-quarter profits totaled totaled $21.6 million, or 67 cents per share a drop from $25.6 million and 75 cents a share in 2014, the company said. Adjusted fully diluted earnings per share were 82 cents, up a penny from last year.
Financial analysts surveyed by Thomson Reuters had forecast $431.8 million in revenue and 87 cents in adjusted earnings per share.
Marriott Vacations raised its range on full-year financial guidance on earnings per share to $3.33 to $3.52, up from $3.29 to $3.48. However, the company predicted that contract sales growth would be flat to 2% higher for the fiscal year, down from the 5% to 8% gain previously forecast.
The timeshare firm also authorized repurchases of an additional 2 million shares through a program that has bought back approximately $106.1 million of Marriott Vacations stock so far during 2015.
Total contract sales during the quarter, excluding residential sales, totaled $159.8 million, down $7.59% from the same period last year. The decrease was driven in part by $5.4 million in lower North America contract sales, the company said. Marriott Vacations' Europe segment experienced a $1.2 million drop in similar sales, while the company's Asia Pacific segment had an equivalent decline of $0.9 million.
The timeshare company said currency exchange differences accounted for some of the financial declines.
"While our development business in the quarter was negatively impacted by a stronger U.S. dollar and unfavorable revenue reportability, our rentals, resort management and financing businesses remained strong," Marriott Vacations president and CEO Stephen Weisz said in a statement issued with the earnings report.
Weisz predicted full-year earnings before interest, taxes, depreciation and amortization would come in at the high end of the company's $222 million-to-$232 million financial guidance, "demonstrating the strength of our diversified business model."
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Source: Marriott Vacations Worldwide shares plunge
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