Brandt Montour: Thanks so much.
Operator: Thank you. Our next question comes from the line of Shaun Kelley with Bank of America. Please proceed with your question.
Shaun Kelley: Hi, good morning, everyone. Thank you for taking my question. Just specifically I wanted to ask about the exchange and third-party management business. I think — you made a comment in the prepared remarks about seeing inventory improve as the quarter progressed. And I was wondering if you could just elaborate on that a little bit. What maybe drove that? And do you expect that to continue either through next quarter or throughout the year?
John Geller: Sure, yeah. A couple of things. There’s things we can do in terms of making offers to the Interval members for say cruise exchanges or things to do with their inventory that would hopefully — people want to go on a cruise. I think Patrick talked earlier about the demand for cruises. So they can exchange their week for a cruise that gives us inventory. So we run different call them promotions to the members and we’ve been doing more of that to drive some of it. It’s also talking with our developers that put in both deposits. They — coming out of COVID some of the historical trends of timing and owner usage like we’ve seen, we’ve seen higher owner usage, right? When you have higher owner usage, you don’t get as many deposits on the exchange side.
So we do think that’s going to help going forward. There’ll be some normalization. People will get back to more exchanges doing other things. So it’s really a combination of the two some of the member activity, but also trying to promote some of this exchange activity. And, obviously, if we can do that that provides more inventory, which then provides more exchange or transaction opportunity for us.
Shaun Kelley: Excellent. Thanks a lot. And then the second follow-up to that would be just, are you seeing — you kind of alluded to this, are you seeing any normalization in that owner utilization piece of the business, right? So are things reverting back to normal from a behavioral perspective at all, or still things just really humming in terms of usage rates just given I guess alternative pricing cost out there?
John Geller: Yeah. No, I think we — the owner usage still is probably a little bit higher than it was pre-COVID. But it’s probably come down a little bit. I would say from what we saw coming right out of COVID right with owners getting back going to our resorts. So time will tell. I do think my sense would be that it will continue to normalize back and people maybe after going to their home resort, or for the past year or two once again try and get out in exchange. I mean, we see it on our vacation ownership business, they’re typically about 25% plus or minus exchange into — on the Marriott side our Explorer program. And so that means they’re taking a vacation outside the system of the vacation ownership resorts, right? So I think we’ll get back to some of that normalization here as we go forward.
Shaun Kelley: Thank you very much.
Operator: Thank you. Our next question comes from the line of David Katz with Jefferies. Please proceed with your question.
David Katz: Hi. Good morning, everyone. Thanks for taking my question. Look a little more of the amount of question, having shut through a good portion of earnings season where we’ve seen mostly very good numbers and pretty good guidance also. But at the same time still this looming slowdown or recession or however we’d like to characterize it that has yet to define itself. I’m just curious, how have you thought about that looming whatever it is and what you’ve talked about and given us today? And — or are you just staying focused on calling it like you see it so far?
John Geller: Yeah. Hey, David. Yeah, I mean this looming recession has been looming. It feels like for 18 months now right — years. It keeps getting pushed out. Now where is it going to go? How deep is it going to be? Is it going to be a hard landing, soft landing all that. So, we always look out. We’re looking at trends. We’re looking at, do we need to make adjustments. Not knowing, what exactly it’s going to be that is going to be what drives our management decision. So, I think you’ve heard me say before, I think in a normal kind of garden variety, not long, too deep over a recession I think we grow our business, right? We don’t probably not going to grow it as fast as we’ve guided here, but if you look at the different parts of the business like we’ve talked about, the exchange side, you go back to the financial crisis even, people own their timeshare, they’re going on vacation.
Resort occupancies on the VO side, will continue to remain very high. We’re in 90% coming out of the financial crisis. So, people own they want to use. And then I think on the sales side, as you think about contract sales on the VO, that’s like — as we talked about we’ve got — we have levers, promotions we can adjust up the offer. We do different things. We’ve done this in the past, we do it month-to-month at times, depending on kind of what we’re seeing to drive sales, et cetera. So, I think like I said, if it’s not some type of deeper long recession, I think we’ll maneuver through it, with probably a little bit of softness, but not what it feels like the market is expecting. But we’ve been talking about this next garden-variety recession, for I don’t know 13 years now, and we haven’t really had it, yet.
So — and really don’t want a recession, but I feel like we’ll be fine working our way through it.
Tony Terry: And I would add a little to that, forward bookings are actually looking good. So — and when you look at our customer, we still have low unemployment. Home prices are still decent. And you look at where our company stands, and how well prepared we are, we have decent liquidity. We don’t have a lot of cash commitments for inventory purchases, right now. We don’t have a lot of cash going out the door for debt repayments until 2025. So, beyond the levers that John may have mentioned, I think we’re pretty decent positioned going forward, if some sort of mild recession does happen.
David Katz: Understood. And if I can follow that up, how long is — would you say the tail is, on that booking window Tony, that you referenced?
Tony Terry: Probably like the six months, we take a look at to 12 months. 12 months, probably a little bit on the outside of it. But when you start looking at within the next six months and through the end of the year, we take a look at where we are right now versus where we were a year ago, or even before that and say, how many bookings do we have on the books, and we do it by previews. We do it, by owner occupancy, renters and all those metrics look pretty decent right now. We’ve been running great occupancy at our resorts. And as you know, when our resorts are full, we get 85% of our sales from on-site, whether it’s previews that we’re putting into the inventory or whether we have owners stand or interesting, we get great penetration rates into owners. So we having them occupy, is not a bad thing for our sales. So, we’re looking pretty good on all those forward-looking metrics.
David Katz: Appreciate it all. Thanks very much.
Operator: Thank you. Our next question comes from the line of Ben Chaiken with Credit Suisse. Please proceed with your question.
