Disclaimer performance. Any non-GAAP financial measure used in this - PowerPoint PPT Presentation

24 typically 10-20 years Our largest franchisee (excluding master franchise agreements) owns 3% of the hotels in our system; the second-largest owns less than 1%. We Have a Diversified, Stable Franchisee Base Economy Upscale Midscale hotel 80 countries on six continents • More than 5,700 franchisees in                                                                                                                                                                                                               • Most franchisees own only one                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              • No significant concentration                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        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                                                                                                                                                                                                                                                                                                          • Long-term franchise agreements                                                                                                                                                                                   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                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          • Retention of 94% annually                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         

25 Our Franchisees Grow With Us . . . This developer’s properties are all in the West Virginia/Ohio region. ONE DEVELOPER’S TIMELINE 2018 2012 2016 2015 2017 2013

26 Operating expenses $134,000 $553,000 $1.4 million $44.00 $1.7 million 70% $5.8 million 85 $68,000 RevPAR Hotel revenue Brand fees . . . Leading to Strong Returns on Hotel EBIT Cost per room Number of rooms Total cost Loan-to-value Franchisee investment operating performance at the hotel. Assumes loan interest rate of 7%. costs per HVS Survey for economy hotels across the United States. RevPAR, expenses and return on invested capital assume a full year of stabilized Data represents indicative results for a new construction Wyndham-branded economy hotel in the United States. Cost per room also includes average land Their Equity. . . $686,000 24% Return on Equity of 24

MILLION 56 MEMBERS OVER 27

28 At Industry-Leading RevPAR Indices RevPAR index = 100% 94% 100% 102% 103% 111% 115% Non-Innov8te Innov8te

29 29

30 Proven Ability to Create Value Through Acquisitions 2017 100% Target Cost Synergies Achieved within Six Months 2006 486 Hotels Today, versus 115 at Acquisition 1993 20% IRR

AmericInn Acquired In October 2017 31

32 La Quinta Bolsters Our Midscale Presence Bubble size reflects hotel count. Economy Midscale and Upper-Midscale Upscale and Above CHAINSCALE

La Quinta Acquisition scheduled to close in Q2 33

34 BEFORE AFTER

35 AFTER

36 AmericInn is a Tuck-In Prototype for Us; La Quinta is Larger, but Strategically Similar Ten AmericInn owned hotels were sold concurrent with closing. Established, well-perceived brand Growth opportunities in existing and adjacent markets Significant synergies No owned real estate Strong strategic fit Immediately accretive to earnings Manageable impact on net leverage

37 Growing Our System Size • Industry-leading franchise sales capabilities • Long-term relationships with hotel owners • Proven ability to identify and engage developers • Positioned to quickly adapt to market changes • Strong global corporate presence Executed nearly 1,500 franchise agreements in 2017

38 Growth in the United States Pipeline Pipeline as of March 31, 2018. Construction New 40% conversion 60% 63,000 rooms markets brands prototypes • Increase economy density with new-construction • Aggressively develop open market tracts for midscale • Expand upscale brand presence in the top urban • Capture soft-branding opportunities • Grow hotel management portfolio • Continually enhance franchisee value proposition

39 87% Pipeline Pipeline as of March 31, 2018. Conversion 13% Construction New International Growth and the Middle East opportunities in Asia, Latin America, Europe, India recognition 85,000 rooms • Rapidly growing middle class driving demand • Leverage significant brand awareness and • Introduce existing brands to new markets • Expand hotel management and franchise

40 Focus: Attract, Develop and Retain Franchisees Brand Quality and System Growth Technology Solutions Loyalty, Sales and Marketing

41 BOB LOEWEN SVP GLOBAL SOURCING, DESIGN & CONSTRUCTION 14 years of industry experience LISA CHECCHIO SVP GLOBAL BRANDS, 15 years of industry experience CHIEF OPERATING OFFICER 27 years of IT experience 17 years of industry experience DAVID WYSHNER CHIEF FINANCIAL OFFICER 17 years of industry experience GEOFF BALLOTTI CHIEF EXECUTIVE OFFICER TAD WAMPFLER CHIEF INFORMATION OFFICER Deep Industry Expertise DEVELOPMENT OFFICER and Leadership Continuity BARRY GOLDSTEIN CHIEF MARKETING OFFICER, 16 years of industry experience TOM BARBER CHIEF STRATEGY AND 8 years of industry experience SCOTT STRICKLAND MARY FALVEY CHIEF ADMINISTRATIVE OFFICER, 19 years of industry experience PAUL CASH GENERAL COUNSEL, 13 years of industry experience 27 years of industry experience

SVP Global Brands Lisa Checchio 42

elevating experiences for the everyday We make hotel travel possible for all, traveler regardless of price point Brand Promise 43

44

45 Service culture SUPER 8 Guest segmentation Public relations/social media Partnerships Marketing Brand architecture ensures ‘swim lanes’ for all brands each with unique high-value Innov8ate Room Package New guest experiences Redefined brand standards We Build Brands that have Unique Positions customer segments. • • • • • • •

49 Brand Names “by Wyndham” label to 12 signature Rewards, hospitality leader adds Building on strength of Wyndham One Powerful Name of Hotel Brands under Unites its Family Wyndham Hotel Group Puts A New Spin On Its The Future Looks Wyndham Hotel Group Ahead Of Spin-off, Under One Family Wyndham Unites Brands Making Its Mark, ‘By Wyndham’ Bright – And Branded economy and midscale brands

50 Harnessing Brand Power with “By Wyndham” Endorsement Increased connections to Wyndham Rewards Wyndham brand gives quality halo to economy brands High awareness of iconic brands drives more awareness for Wyndham

51 Proven Endorsement Successes

52 DIGITAL IMPRESSIONS Brand Exposure ROADSIDE IMPRESSIONS MORE DIGITAL VISIBILITY Digital visibility measured as being found online through all searches. 6 540 75 Billion Billion Percent

EVP & Chief Marketing Officer Barry Goldstein 53

54 will double in size estimated to increase by 50% brands growing rapidly Our Target Customer is Expected to Travel More than Ever Source: Mapping the Future of Global Travel and Tourism, Visa 2017 • The global middle class • International trips are • Millennials favor our • Senior travel population

55 We are Delivering Best-in-Class Tools and Programs Focused on the Everyday Traveler DISTRIBUTION LOYALTY DIGITAL

56 members We Invented the Most Generous and Simple Hotel Loyalty Program in the Industry • Over 56 million enrolled • Growing rapidly • One simple redemption level • 30,000+ places to redeem • Major entertainment partners

57 7.5% Spending Loyalty Program Wyndham Rewards Source: IdeaWorksCompany Inc. 5.4% 6.7% 7.4% 8.8% 16.7% Starwood IHG Best Western Hilton Marriott Wyndham company loyalty programs. Here are the payback rates for six major hotel Source: Deanna Ting, Skift – Oct 05, 2017 Payback is Rich Provides the Most Payback on Guest

58 Increased member occupancy Members stay longer and spend more Redemptions further boost occupancy Members sample additional Wyndham brands Our Franchisees Benefit from Wyndham Rewards • • • •

59 New platform enables faster integration of new brands Personalization for the everyday traveler driving conversion Mobile check-in and check-out for all brands We Have Been Transforming Our Digital Platforms Mobile room nights have grown by 75% year-over-year • • •

60 Member loyalty rates drive over 35% of direct bookings Direct bookings have grown by 210 basis points this year Driving Direct Bookings is a Key Focus • •

61 New state-of-the-art Central Reservation System Increased online conversion and revenue More connections to online travel agents and global sales channels Increasing Revenue through Growing Our Distribution • • •

62 Central Contribution Has Grown by Nearly 50% For North America region only. Represents bookings through direct channels. 41% 61% 49% Growth 2013 2017

Chief Information Officer Scott Strickland 63

front of a developing trend Wyndham Hotels is out in Technology 64

65 Wyndham has cloud-based platforms leveraging best-in-class software and partnerships across the key aspects of the guest and franchisee experience Technology: Outsourced and Cloud-Based Digital Content Central Property + Web Reservations Management

66 Wyndham’s investment in scalable partner platforms has been proven through rapid growth and implementations Benefits of the Platform: Scalability Flexes Based on Demand Accommodates Acquisitions Expands Globally Manages Resources Cost Effectively

67 Reservation Reservation Platform 1 Digital WYNDHAM vs. Platform 2 Platform 1 Speed of Integration Reservation Platform 2 Digital Platform 1 Digital TYPICAL COMPETITORS Platform 1

68 across Brands Reduces Cost Boards Advisory Partner Power across Consolidates Improvements Case Study Leverages Market Speed to Increases Points Integration Reduces of Delivery

69 David Wyshner Chief Financial Officer

70 Our Business Recent Results and Outlook Free Cash Flow and Balance Sheet Substantial Growth Opportunities Agenda Our Business

model drives consistent earnings Asset-light, fee-based business and cash flow growth Our Investment Thesis 71

72 Overview Generating asset-light, annuity-like earnings Seizing growth opportunities Producing significant cash flow Delivering solid results Creating Value for Shareholders

73 Our Asset-Light Hospitality Business Generates Stable, Recurring Earnings RECURRING, FEE-BASED INCOME HIGH OPERATING MARGINS MINIMAL CAPITAL REQUIREMENTS of adjusted EBITDA  90% of revenue is fee-for-service  Primarily from long-term agreements  90% margin on franchise and royalty fees  Capital expenditures are less than 10%  We only own two hotels

74 RevPAR x Rate Royalty $71 x Rate Daily Average 55% x Occupancy 765,000 We Use Our Brands to Generate Recurring Rooms of $11 billion revenue wide room On system- $416 million Revenue Royalty x 365 = Figures are pro forma for the pending acquisition of La Quinta. Room count represents the weighted average rooms available in our system throughout 2017. Royalty Revenues 3.8%

75 = $195 69% $134 x = Hotel management fees $161 24% $39 x Marketing, reservations & loyalty = $543 1% $5 x = Cost reimbursement revenue $627 0% $0 x = Other franchising revenues x We Generate Over 80% of Our EBITDA Revenue from Recurring Royalty Fees Figures are for 2017, pro forma for the La Quinta acquisition and expected synergies. Margins and EBITDA contribution amounts are approximate. The Company operates two owned hotel properties; their results are included in hotel management fees. Other franchising revenues are primarily derived from our co-branded credit card program, initial franchise fees and other ancillary services. Corporate & other ($69) Total $2,040 28% $564 Margin $93 EBITDA Contribution Royalty $416 87% $362 x = Wyndham Destinations royalty $98 95% ($ in millions)

76 China United States Leisure Major Cities Midscale All Other 31% Business Secondary Cities Suburban/ Rural Upscale Economy 33% We Have a Diversified, Stable Franchisee Base Segmentation Our largest franchisee (excluding master franchise agreements) owns 3% of the hotels in our system; the second-largest owns less than 1%. System Concentration Regional Concentration Customer 49% 37% 42% 9% 60% 19% 21% 80% 20% Location

77 Our Business is Less Sensitive to RevPAR Hotel Owner Illustrative Earnings Sensitivity to a 1% Decline in RevPAR % Change In EBIT Hotel Franchisor Dynamics Hotel owner assumed to have a 20% EBIT margin. 3% 2% 1% 0% (1%) (1%) (2%) (3%) (4%) (5%) (5%) (6%)

78 Our Business Recent Results and Outlook Free Cash Flow and Balance Sheet Substantial Growth Opportunities Agenda Recent Results and Outlook

79 627k Performance . . . Historical data do not include La Quinta. 3.8% 3.8% $38 $35 Stable and Predictable Operating 728k Global Rooms Global RevPAR Global Royalty Rate 3% 2% Consistent CAGR CAGR 2012 2017 2012 2017 2012 2017 U.S. average royalty rate is up 20 basis points

80 $890 31.0% 30.6% million $416 million $271 million $1,343 . . . Produces Stable and Predictable million Financial Performance Amounts are before adoption of new revenue-recognition standard. Historical data do not include La Quinta. Revenue Adjusted EBITDA Margin 9% 9% Consistent CAGR CAGR 2012 2017 2012 2017 2012 2017

81 $406 migration Global RevPAR Growth Rooms Growth $445-455 million million comparable basis, excluding the acquisition of La Quinta and the divestiture of Knights Inn. compensation) and is before Corporate & Other costs, La Quinta impact and separation-related adjustments. Rooms and RevPAR growth are on a 2017 restated for adoption of new revenue-recognition standard. Adjusted EBITDA reflects Wyndham Worldwide definition (after stock-based Full-Year 2018 Outlook excluding La Quinta 2-4% Adjusted EBITDA 10-12% Growth 2-3%  Integrating La Quinta  Rolling out ‘by Wyndham’ branding  Completing reservation-system 2017 2018

82 Integration of La Quinta restructuring and related charges, contract termination costs, transaction-related costs (acquisition-, disposition- or separation-related), stock-based Adjusted EBITDA is defined by Wyndham Hotels & Resorts as net income excluding interest expense, depreciation and amortization, impairment charges, Pro Forma Financials Expected debt balance and interest expense Acquisition of La Quinta Incremental license fee revenues Corporate costs More common definition of Adjusted EBITDA compensation expense, early extinguishment of debt costs and income taxes. • • • • • •

83 La Quinta adjustments Corporate & Other costs Pro Forma Adj. EBITDA excluding La Quinta Separation- stand-alone Synergies 2018 Pro Forma Adjusted EBITDA related compensation Pro Forma 2018 Adjusted EBITDA $435-445 Separation-related adjustments represent incremental license fees from Wyndham Destinations and other changes being effected in conjunction with the spin-off. $445-455 $19-23 $30-34 ($60-65) $96-102 Stock-based $55-70 $590-610 2018 Hotel Group Segment Adj. EBITDA ($ in millions)

84 Adjusted Net Pro Forma Adjusted Earnings Per Share of $2.95 - $3.15 ($110-115) ($19-23) ($94-98) ($65-70) amortization Depreciation & EBITDA Adjusted Pro Forma Income Pro Forma $590-610 Taxes Pre-tax Income Adjusted Pro Forma compensation Stock-based expense Interest EPS based on 101.6 million expected diluted shares. Pro Forma 2018 Adjusted Earnings $300-320 $410-430 ($ in millions, except per share data)

85 Our Business Recent Results and Outlook Free Cash Flow and Balance Sheet Substantial Growth Opportunities Agenda Free Cash Flow and Balance Sheet

86 Adjusted Earnings ($50-60) ($94-98) ($94-98) ($ in millions) $300-320 Net Income of vs. Adjusted approximately $20 million of hurricane-related spending at our Rio Mar hotel, which is expected to be funded by insurance recoveries. prospective franchisees to spur new hotel development with our brands and may be forgiven if certain conditions are met. Capital expenditures exclude Free Cash Flow is defined as operating cash flow less capital expenditures. Development advances are provided to a small percentage of current or Our Cash Flow Approximates Our $590-610 Free Cash Flow Pro Forma advances Development expenditures Capital Cash taxes Interest expense Adjusted EBITDA Pro Forma $320-340 ($20-25)

87 Simple Capital Structure ($ in millions) Revolving Credit Facility ($750 million capacity) Term Loan due 2025 Senior Notes due 2026 Capital Leases Total Debt $ 0 1,600 500 68 $ 2,168

88 Appropriate Net Leverage Debt ratings of Ba1 / BB+ are just below investment-grade Net Leverage 4.0 3.6x Target Range 3.0 2.0 1.0 December 2017 Pro Forma

89 Principled Allocation of Capital MAINTAIN HEALTHY, EFFICIENT BALANCE SHEET INVEST FOR GROWTH RETURN CAPITAL TO SHAREHOLDERS  Preserve liquidity and manage leverage  Maintain flexibility to invest in growth  Organic opportunities  Invest in technology to drive efficiency  Tuck-in acquisitions  Dividends  Share repurchases

90 Capital Return to Shareholders Dividends growth adjusted earnings growth in line with approximately 30% market timing shareholders, not on excess cash to Share Repurchase authorization growth [adjusted] earnings growth in line with approximately [30%] Dividend expected to be paid quarterly, beginning in June 2018.  1.00 annually • $1.00 annually • $300 million initial  Payout ratio of • Payout ratio of • Focus on returning  Targeting dividend • Targeting dividend

91 Our Business Recent Results and Outlook Free Cash Flow and Balance Sheet Substantial Growth Opportunities Agenda Substantial Growth Opportunities

92 Numerous Sources of Earnings Growth 1 6 2 3 4 5 Rooms growth Share repurchases RevPAR growth Hotel management Tuck-in acquisitions International expansion

93 3 Tuck-in acquisitions Hotel management RevPAR growth Share repurchases ROOMS GROWTH 5 4 2 Numerous Sources of Earnings Growth 6 1 International expansion  Franchise sales and development  New construction  Under-represented markets  Soft-brand opportunities for Trademark  Reduced terminations over time

94 3 Tuck-in acquisitions Hotel management REVPAR GROWTH Share repurchases Rooms growth 5 4 2 Numerous Sources of Earnings Growth 6 1 International expansion  Favorable industry-wide trends  Product quality and consistency  Digital marketing  Loyalty  ‘by Wyndham’ effects  Revenue management

95 2 Tuck-in acquisitions Hotel management RevPAR growth Share repurchases Rooms growth 5 4 3 6 Numerous Sources for Earnings Growth 1 platform last three years) INTERNATIONAL EXPANSION  85,000-room pipeline (growing 9% over  Direct franchising in emerging markets  La Quinta in Latin America  Under-represented in Europe  Rapidly growing global middle class  Global technology and distribution

96 3 Tuck-in acquisitions HOTEL MANAGEMENT RevPAR growth Share repurchases Rooms growth 5 4 2 Numerous Sources of Earnings Growth 6 1 International expansion  Economies of scale  Serve multi-property franchisees  Attract non-operator owners  Support international expansion  Margin growth

97 4 TUCK-IN ACQUISITIONS Hotel management RevPAR growth Share repurchases Rooms growth 5 3 Numerous Sources of Earnings Growth 2 6 1 International expansion  Franchise brands  International brands  Hotel management

98 Numerous Sources of Earnings Growth 1 6 2 3 4 5 Rooms growth SHARE REPURCHASES RevPAR growth Hotel management Tuck-in acquisitions International expansion  $300 million authorization

99 2-3% Impact 3-5% Cash flow deployment 0-1% Hotel management 0-2% International expansion RevPAR growth Long-Term Growth Opportunity 8-14% Long-term EPS growth potential 2-4% Rooms growth potential range is “pinched” because various sources of growth are not expected to all be at the high or all at the low end of their individual ranges. Cash flow deployment assumes all free cash flow after dividends is deployed to either acquire businesses or repurchase shares. Long-term EPS growth Hotel management reflects the overall Incremental growth from faster expansion of, or operating efficiencies within, our hotel management business. Rooms growth excludes impact of growing brands in new or under-penetrated markets, the impact of which is reflected within international expansion. on EPS

100 management brands 5 Strong global presence 6 Experienced team Key Investment Highlights 7 Significant organic and external Principled capital well-known portfolio of Diversified 4 1 Resilient business model drives recurring cash flows 2 Passionately asset-light $ 0 3 Industry-leading position in economy and midscale allocation opportunities 8