Guidance & Maui
Q: Execution issues and Maui update?
A: Management explained that lower contract sales—particularly in VPGs—and execution challenges from staffing delays drove the guidance pullback. They also noted that despite recovery challenges from the Maui wildfire, the resorts remain fully operational, ensuring continuity.

Underwriting & Synergies
Q: How are Bluegreen underwriting and synergies tracking?
A: They stated that underwriting across brands remains consistent, with slight pressure from Bluegreen, while cost synergies are on course at a run rate of roughly $71 million, targeting $100 million in 2025.

Guidance Breakdown
Q: Macro versus execution in guidance cut?
A: Management attributed about 80% of the pullback to lower new buyer (VPG) performance and 20% to increased bad debt, reflecting both macro and execution factors.

Sales Reorg
Q: What’s behind the sales reorganization?
A: They restructured the sales and marketing teams following the Bluegreen acquisition, moving from a centralized model to a regional approach with enhanced mid-level leadership and a new Chief Sales and Marketing Officer.

Restructure Process
Q: Was the restructuring process planned or choppy?
A: It was a deliberate, 90-day planning effort that led to temporary disruption in June but resulted in a strong rebound in July’s performance.

Leadership Ramp
Q: What’s the timeline for new leadership?
A: Nearly all key leadership positions have been filled, with only minor relocations remaining, indicating that the leadership ramp-up is essentially complete.

Sales Resources
Q: Has under-resourcing affected sales?
A: The integration challenges and staffing shortfalls initially slowed new buyer performance, though improvements have been noted since the June reorg; the lower-tier buyers still face some pressure.

Bad Debt Provision
Q: Why are debt provision percentages increasing?
A: They increased provisions in line with historical benchmarks and integration challenges, with Bluegreen’s reserve, now around 36%, incorporated into their monthly-updated static pool model.

Local Market
Q: How is local market softness being addressed?
A: With 40% of new buyer tours driven by local marketing, recent staffing improvements are expected to reverse softness in this area during the back half of the year.

Financing Terms
Q: Any change to deposit requirements for buyers?
A: Although they occasionally run promotions, the standard 10% deposit remains to ensure buyers have meaningful equity, aligning with revenue recognition policies.

Product Offering
Q: Is a new product for lower-budget buyers planned?
A: The diversification following the Bluegreen acquisition has broadened the product mix, and the rollout of HGV Max later this year is expected to help address lower-tier buyer hesitancy.

Maintenance Fees
Q: What growth is expected in maintenance fees?
A: The company anticipates maintenance fees to increase in the mid-single digits, consistent with historical trends even during challenging periods.

Currency Impact
Q: Will a stronger yen boost Hawaii demand?
A: While a strengthening yen is positive, its impact on new buyer demand is expected to lag, with destinations like Sesoko already showing high occupancy.

Board Member
Q: How qualified is the new board member?
A: Management emphasized that the new board member, selected by Apollo, brings extensive industry experience dating back to 2019 and has already demonstrated her value in early board meetings.