Marriott International

Good day, everyone, and welcome to today's Marriott International first quarter 2024 earnings conference call. At this time, all participants are in a listen-only mode. Following the speaker's remarks, there will be a question and answer session. You may register to ask a question at any time by pressing star 1 on your telephone keypad. Please note today's call will be recorded, and I'll be standing by if you should need any assistance. It is now my pleasure to turn the conference over to Jackie McConica, Senior Vice President, Investor Relations. Please go ahead.

Thank you. Good morning, everyone, and welcome to Marriott's first quarter 2024 earnings call. On the call with me today are Tony Capuano, our President and Chief Executive Officer, Lili Oberg, our Chief Financial Officer and Executive Vice President, Development, and Betsy Dahm, our Vice President of Investor Relations. Before we begin, I would like to remind everyone that many of our comments today are not historical facts and are considered forward-looking statements under federal securities laws. These statements are subject to numerous risks and uncertainties as described in our SEC filings, which could cause future results to differ materially from those expressed in or implied by our comments. Unless otherwise stated, our REVPAR occupancy average daily rate and property-level revenues comments reflect system-wide constant currency results for comparable hotels, and all changes refer to year-over-year changes for the comparable period. Statements in our comments and the press release we issued earlier today are effective only today and will not be updated as actual events unfold. can find our earnings release and reconciliations of all non-GAAP financial measures referred to in our remarks today on our Investor Relations website. And now I will turn the call over to Tony.

Thanks, Jackie, and good morning, everyone. 2024 is off to a solid start as Marriott continues to deliver great experiences to travelers around the world. First quarter global rent bar rose 4.2%, with ADR increasing around 3%, and occupancy reaching almost 66% of nearly 100 basis points year over year. While overall industry RevPAR growth is normalizing post-COVID, we continue to gain RevPAR index across our portfolio and increase our market share of global hotels. Once again, we saw RevPAR growth across all three of our customer segments, group, leisure transient, and business transient. Groove, which comprised 24% of global room nights in the first quarter, was again the strongest customer segment. Compared to the year-ago quarter, group rep bar rose 6% globally. Full-year 2024 worldwide group revenues were pacing up 9% year-over-year at the end of the first quarter, with a 5% increase in room nights and a 4% rise in average daily rate. Leisure Transient accounted for 42% of worldwide room nights in the quarter. Globally, both leisure demand and ADR growth have remained remarkably resilient, driving Leisure RevPAR up 4% year over year. Business Transient, which contributed the remaining 34% of global room nights in the first quarter, had a 1% increase in RevPAR. We are making great progress on the multi-year digital and technology transformation of our three major systems, reservations, property management, and loyalty. Through this transformation, we expect to unlock new revenue opportunities, further strengthen our efficient operating model, enhance Marriott Bonvoy, and elevate the associate and customer digital experience. We still expect to begin rolling out our new cloud-based systems to properties next year. In the meantime, we're enhancing the digital experiences that matter most to customers, primarily how they shop and book through our channels. We also recently celebrated the five-year anniversary of Marriott Bonvoy, which added nearly 7 million members during the quarter and had around 203 million members at the end of March. Member penetration of global room nights reached record highs in the first quarter, at 70% in the US and Canada, and 64% globally. Since its introduction, Marriott Bonvoy has evolved to become a travel and loyalty platform encompassing a portfolio of more than 30 brands across nearly 8,900 properties and other travel offerings such as Homes and Villas by Marriott Bonvoy and the Ritz Carlton Yacht Collection. Marriott Bonvoy also spans numerous additional collaborations and member benefits including co-brand credit cards, in 11 markets and counting, and access to a broad range of unique, curated experiences through Marriott Bonvoy moments, including select Taylor Swift era tour concert performances. Looking ahead, we continue to focus on new ways to enhance the platform and connect with our members in their daily lives and across their traffic journeys. We had a very busy first quarter on the development front. We added a record 46,000 net rooms, growing our distribution by 7.1% compared to the end of the first quarter last year. MGM Collection with Marriott Bonvoy has now launched, with 16 properties in Las Vegas and other key U.S. cities now available on our system. While it is still early days, we've been extremely pleased with the initial booking pace and Marriott Bonvoy room contribution, which have both outpaced expectations. While the financing environment in the U.S. and Europe is still challenging, we have strong momentum in global signings after a record 2023 and have tremendous optimism for the full year. Both Greater China and APEC had notable deal production in the first quarter. Year over year, our open and pipeline rooms grew 6.7%, excluding the addition of our 17,000 city express rooms. Conversions, including multi-unit opportunities, continue to be a meaningful driver of growth, representing 30% of global signings in the first quarter. Our new mid-scale brands, City Express by Merit, 4 Points Express, and Studio Res, are seeing significant developer interest. Earlier this year, we signed our first City Express deal in the region since acquiring the brand. and we are in multiple deal discussions for other properties across the Cala region. We have also now opened our first Four Points Express in Turkey and have other properties in the pipeline. We also recently signed our first mid-scale deal in the APAC, a portfolio of more than a dozen hotels that are expected to be added to our system later this year. In the U.S. and Canada, we have commitments for around 140 studio res properties and are actively working on deals for over 100 more. Additionally, in about a month, we look forward to unveiling details on our next exciting brand launch, a conversion-friendly mid-scale brand in the region. As always, I've spent much of my time this year traveling around the world. It's been a pleasure to visit many of our amazing hotels and speak with our incredible associates. I want to express my gratitude to all of our associates for their continued hard work and dedication. As Leni will now discuss further as part of her financial review, we are raising our full year 2024 earnings and capital returns guidance on the back of the strength of our diverse global portfolio, the continued resilient and steady demand for travel, our strong international performance, and our continued rooms growth. Leni?