Willis Towers Watson Public Limited Company

Good morning and welcome to WTW's second quarter 2022 earnings confidence call. Please refer to WTWCEO.com for the press release and supplemental information that was issued earlier today. Today's call is being recorded and will be available for the next three months on WTW's website. Some of the comments in today's call may constitute forward-looking statements within the meaning of the Private Securities Reform Act of 1995. These forward-looking statements are subject to risk and uncertainties. Actual results may differ materially from those discussed today, and the company undertakes no obligation to update these statements unless required by law. For a more detailed discussion of these and other risk factors, investors should review the forward-looking statements section of the earnings press release issued this morning, as well as other disclosures in the most recent Form 10-K, and in other Willis Tower Watson's SEC filings. During the call, certain non-GAAP financial measures may be discussed. For reconciliation of the non-GAAP measures as well as other information regarding these measures, please refer to the most recent earnings release and other materials in the Investor Relations section of the company's website. I will now turn the call over to Carl Hess, WTW's Chief Executive Officer,

Please go ahead.

Good morning, everyone. Thank you for joining us for WTW's second quarter 2022 earnings call. Joining me today is Andrew Krasner, our chief financial officer. In the second quarter, WTW delivered results that, as expected, built off the solid start we had to our year. We generated organic revenue growth of 3% and adjusted diluted earnings per share of $2.32 as we continued to make progress on our strategic initiatives. Our transformation program, continued expense discipline, and operating leverage from new business generation drove 30 basis points of adjusted operating margin despite headwinds from our growth investments. We also continued to execute against our capital allocation strategy and completed $471 million in share repurchases in the second quarter, bringing total share repurchases for 2022 to $2.7 billion. Overall, we're pleased with our second quarter performance and remain confident in our ability to deliver against our financial goals in both 2022 and the longer term. This confidence comes from our ongoing execution against our strategy to grow, simplify, and transform, as well as our continued progress in rebuilding our talent and ramping our productivity. Through the first half of the year, we've already seen top-line benefits from our investments in talent, and we expect that benefit to meaningfully accelerate in the second half of the year. I'm particularly pleased with the results of our transformation initiatives. We realized $35 million of incremental annualized savings during the second quarter, bringing the total to 71 million cumulative since the program's inception, or more than double our original $30 million target for 2022. Accordingly, we're raising our guidance on cumulative run rate transformation savings identified by the end of 2022 from 30 million to over 80 million. It's important to note that this increase is not simply pulling forward savings previously included in our $300 million medium term target. Our focus on continuous improvement has helped us identify both areas in which we could accelerate progress as well as new opportunities and incremental sources of value. As a result, we now expect the program to generate annual cost savings in excess of $300 million by the end of 2024. In the second quarter, we also made progress on our GROW initiatives, bringing to bear the full capabilities of 1WTW for our clients through both new and existing solutions. Our strategic focus on scaling our global lines of business in corporate risk and broking is gaining traction in the market, with growth in these lines exceeding the CRV average by 50%. We also maintained a steady pace of new product launches, focusing on high-growth, high-need markets such as ESG analytics and climate risk. In April, we launched our ESG analytics program at the U.S. RIMS conference. It's already generating early results by simplifying our client outreach and solving ESG data, analytics, and reporting needs for clients, and has been part of seven-figure wins in two pilot markets in 2022. We believe this solution has the potential to scale further in multiple markets around the world, and we're building a world-class suite of climate risk management tools and solutions under our climate quantified banner. Following our development of the climate transition pathways accreditation framework and the launch of our climate transition index with stocks in 2021, this year we introduced our climate transition value at risk data and software for asset managers and asset owners. Earlier this month, we announced the acquisition of one of our longtime climate analytics and software partners, further enhancing our technical capabilities. Our investments in this area are positioning us to be a global leader in helping organizations manage climate transition risk. While new products are important, our approach to everyday innovation is also supporting our growth priority as we nimbly respond to legislative and other environmental changes. As suggested by the everyday label, there's lots happening in this area, so I'll share just one to give you an idea. In response to the U.S. Healthcare No Surprises Act, we quickly developed and introduced transparency bundles, a cost-effective communication solution that supports clients in meeting their compliance obligations, and is easily sold as an add-on to our existing clients. Lastly, together with our strategic growth initiatives, Our intense focus on onboarding talent has built a strong foundation for revenue growth in the second half of 2022 and beyond. The pace of hiring in the second quarter matched that of the first quarter and our new hires and sales and client management roles doubled compared to the second quarter last year. We also continued to see the benefit of retention efforts with voluntary attrition at reasonable levels and aligned with macro trends. In sum, We've been hard at work this quarter changing the way we operate and creating a leaner, more innovative, and more agile WTW. I'm confident that as these initiatives mature, they will improve our long-term financial performance as we expect and deliver significant shareholder returns. Before I hand it over to Andrew to discuss our financial results, I want to take a moment to talk about the resilience of our business in the face of dynamic and challenging economic conditions. We believe WTW is well positioned to weather macroeconomic uncertainty, including both inflation and potential recession. Our portfolio of businesses is relatively non-cyclical. We estimate that about 80% of our revenue base is recurring, often built upon non-discretionary solutions and services. In addition, our clients span a variety of industries and geographies, and our solutions tend to increase importance and value in complex economic environments. For these reasons, our business is less sensitive to economic downturns than companies in some other industries. As an example, in 2020, when U.S. GDP declined by 2%, we still posted organic revenue growth of 2%. Similarly, if you looked at our predecessor company's results from the 2008-2009 economic downturn, you'd see that they continued to grow organic revenues by 2% to 4%. That said, we do have some exposure in economically sensitive lines of business where the work we do is discretionary in nature, primarily in our health, wealth, and career segment, but we would expect the impact of that exposure in recession to be relatively low. Overall, our performance in the quarter was aligned with our expectations and reflected our commitment to profitable growth and the successful execution of our strategy. We continue to build momentum and remain focused on delivering on our long-term goals. In closing, I want to express my gratitude to my incredible team of colleagues who live our values and have delivered every day for our clients in a volatile and challenging environment. With our sharpened focus, we are well positioned to continue driving growth and executing on our transformation. And with that, I'll turn the call over to Andrew for more detail on our results.