Hyatt Hotels Corp

session. If you would like to ask a question during this time, simply press star followed by the number one on your telephone keypad. If you would like to withdraw your question, press star one again. Thank you. As a reminder, this conference call is being recorded. I would now like to turn the call over to Adam Roman, Senior Vice President of Investor Relations and Global FP&A. Thank you. Please go ahead.

Thank you, and welcome to Hyatt's third quarter 2024 earnings conference call. Joining me on today's call are Mark Hoplamazian, Hyatt's President and Chief Executive Officer, and Joan Botterini, Hyatt's Chief Financial Officer. Before we start, I would like to remind everyone that our comments today will include forward-looking statements under federal securities laws. These statements are subject to numerous risks and uncertainties as described in our annual report on Form 10-K, quarterly reports on Form 10Q, and other SEC filings. These risks could cause our actual results to be materially different from those expressed in or implied by our comments. Forward-looking statements in the earnings release that we issued today, along with the comments on this call, are made only as of today and will not be updated as actual events unfold. In addition, you can find a reconciliation of non-GAAP financial measures referred to in today's remarks on our website at hyatt.com under the Financial Reporting section of our Investor Relations link and in this morning's earnings release. An archive of this call will be available on our website for 90 days. Please note that unless otherwise stated, references to occupancy, average daily rate, and REVPAR reflect comparable system-wide hotels on a constant currency basis. Percentage changes disclosed during the call are on a year-over-year basis unless otherwise noted. We have updated our inventory schedule on page A4 of the earnings release to now include hotels and rooms associated with Mr. and Mrs. Smith and other strategic alliances. And with that, I'll now turn the call over to Mark.

Thanks, Adam. Good morning, everyone, and thank you for joining us today. Before I turn to the quarter, I would like to acknowledge the damage caused by recent hurricanes in the Southeast United States. In response, Hyatt colleagues have come together through our Hyatt Care Fund to provide financial support to those in need. Our purpose, to care for people so they can be their best, resonates in times like these and we are thankful that our colleagues are safe. I recently spent time in Europe and Asia where I met with many of our teams and owners, including a visit to the newly opened and stunning Park Hyatt London. The hotel is a flagship representation of the Park Hyatt brand in one of the most vibrant cities in the world. I also had the opportunity to visit with our new Standard International colleagues in Bangkok, who are preparing for several exciting openings of Standard branded hotels across Asia over the coming months. The trip left me filled with excitement for Hyatt's future as we continue to grow across many markets globally, while delivering differentiated guest experiences for the high-end travelers in each segment that we serve. Now, turning to the quarter, our third quarter results reflect the strength of our asset-light business model, including double-digit growth in gross fees, record number of rooms in our pipeline, and a record number of World of Hyatt members. This morning, we reported system-wide RevFar growth of 3%, and we continue to see high-end consumers prioritizing travel, as RevFar growth is strongest amongst our luxury brands. Leisure transient revenue decreased approximately 4% in the quarter, driven by the United States and Greater China. Through the first nine months of 2024, revenue is flat compared to 2023, despite headwinds from renovations at certain resort properties and weaker demand in Maui. Transient pace for resorts in the Americas is up over 9% over the festive period and up slightly in the first quarter of 2025. America's all-inclusive resorts pace is up 10% over the festive period and up over 20% in the first quarter of 2025. Group rooms revenue increased approximately 6% in the quarter with strong results in both the U.S. and Europe. Group pace for U.S. full-service managed properties is up over 5% in the fourth quarter excluding the timing shift of the Jewish holidays in October and the U.S. election next week, and is otherwise flat when accounting for the holidays and election week. As we look to 2025, group pace is up approximately 6% compared to 2024, with average rate accounting for over half of that increase. Business transient customers continue to deliver the largest year-over-year growth, with revenue up approximately 16%. In the United States, revenue increased at a similar growth rate and major urban markets continue to benefit from the recovery of business travel. We continue to see exceptional engagement from our World of Hyatt members, which is reflected in our third quarter results. World of Hyatt membership passed the 50 million milestone and reached a new record of approximately 51 million members at quarter end, a 22% increase over the prior year. Loyalty room night penetration also increased as we realized the direct benefit of our growing membership base. And spending on our co-branded credit cards has increased 16% through the first nine months of 2024 compared to the same period in 2023. Finally, World of Hyatt was recognized as one of the top hotel loyalty programs by a U.S. News & World Report. Our members continue to benefit from our greater system size and expanding collection of world-class brands, while our membership growth and increased room-night penetration reduces customer acquisition costs, which we believe makes us even more attractive to owners and developers. We see evidence of owner and developer preference reflected in our pipeline, which expanded to 135,000 rooms, a new record. This represents an increase of approximately 10% compared to the third quarter 2023, and our pipeline represents 41% of our existing room base. The United States and greater China continue to account for significant signing activity, especially among our upper mid-scale brands, Hyde Studios and Yurkov by Hyatt. We also saw healthy signings among our all-inclusive brands in the Americas, and I'm thrilled that we signed our first all-inclusive resorts in Asia Pacific, the Hyatt Zalara and Hyatt Ziva Pangna in Thailand. We also recently announced the formation of a joint venture and strategic collaboration agreement with China Resources Land to expand Hyatt's brand presence across China. This includes six existing hotels that have joined the Unbound Collection by Hyatt and JDV by Hyatt collection brands. Additionally, and separate from the JV, Hyatt and CR Land have signed agreements for two new projects, including Park Hyatt Xi'an and Andaz Dongguan, which deepens our relationship with CR Land, who own seven existing luxury Hyatt branded properties in China. During the third quarter, we achieved net rooms growth of 4.3%. There were several notable luxury openings in the quarter, including the Park Hyatt Marrakesh, our first Park Hyatt in Northern Africa, and the Alila Shanghai, a flagship for future development of this luxury brand at urban markets. We also opened the Grand Hyatt Kunming, the 18th Grand Hyatt in Greater China. Our openings provide more opportunities for our guests and members to engage with us, while our growing pipeline allows us to expand into new markets into the future. Turning to transactions, on August 16th, we hit a significant milestone with the sale of High Regency Orlando and the adjacent land for gross proceeds of $1.07 billion. This marked the completion of our third asset disposition commitment, which we announced in 2021. Over the three-year period, we realized gross proceeds of $2.6 billion net of acquisitions at a multiple of 13.3 times. While we've successfully completed our third disposition commitment, we expect to continue to reduce our hotel ownership. Hyatt Grand Central New York and Onda's Liverpool Street both remain under contract for redevelopment. Upon closing, we will receive significant proceeds from these sales and upon the completion of the redevelopments, we will have magnificent new hotels in each highly desirable location. Additionally, we are actively engaged in other discussions and expect to sell more hotels in 2025 and beyond. First, we completed the acquisition of Standard International, which includes the Standard, Standard X, and Bunkhouse brands, further enhancing our position in the lifestyle segment. At closing, 22 hotels with approximately 2,000 rooms joined Hyatt, and the acquisition will add 10 executed agreements to the pipeline in the fourth quarter, totaling approximately 1,300 rooms. In addition, there are more than 20 additional projects, including branded residences, with a signed agreement or letter of intent. I'm also pleased to share that we've already engaged in conversations resulting from inbound calls for new projects since we announced the acquisition. On October 28th, we announced the signing of an agreement to enter into a long-term strategic joint venture with Grupo Pinheiro to manage Bahia Principe hotels and resorts. 23 open and operating resorts totaling over 12,000 rooms will be added to Hyatt's inclusive collection upon closing, expanding Hyatt's all-inclusive room portfolio by approximately 30%. This is a unique opportunity to expand our all-inclusive offerings in the 4.5-star category, which fills white space in our brand portfolio. Presently, over 85% of Hyatt's all-inclusive resorts in the Americas are 5-star properties, and this transaction enhances our network effect by expanding our all-inclusive offerings to members and guests at multiple price points. The transaction is anticipated to close in the coming months, and we will provide more details once the transaction closes. Seven years ago, we committed to permanently reducing our earnings from owned hotels while investing in asset-light growth. The results of our transformation into an asset-light business have been highly accretive to shareholder value. We've realized $5.6 billion of gross proceeds net of acquisitions from asset sales at a multiple of 15 times, which exceeds the overall multiple at which Hyatt has historically traded. We've reduced our owned and leased adjusted EBITDA by approximately $390 million and annual capital expenditures by over $100 million, while adding approximately $50 million of durable management franchise fees from the sold hotels. At the same time, we have acquired asset-like platforms including Two Roads Hospitality, Apple Leisure Group, Dream Hotels Group, and Standard International for a total of $3.6 billion at a blended multiple of approximately 9.5 times. We have exceeded our underwriting expectations for both Two Roads and ALG, and we expect to do the same. for Dream and Standard when those acquisitions mature. Not only have we replaced EBITDA from asset sales, but we have and will continue to do so in a much more capital-efficient manner that drives greater free cash flow. Additionally, during this time, we have returned $4.4 billion to shareholders, including $4.2 billion of share buybacks at a weighted price of $87.74 per share. Our capital allocation strategy has fueled our growth while creating significant value for shareholders. While we celebrate the successful execution of our earnings transformation, we recognize continued evolution and innovation is essential to benefit all our stakeholders into the future. In the coming months, we will debut a new lifestyle group led by Amar Lalbani, former executive chairman of Standard International. Amar brings his expertise designing world-class lifestyle brands and delivering exceptional experiences, and I'm excited to welcome him and all the Standard International colleagues to Hyatt. We will also be forming a dedicated luxury group with distinct leadership across key functions and services focused on caring for guests and customers at the pinnacle of luxury. We will continue to leverage the significant capabilities that we've been building while welcoming new colleagues with unique talents. We believe this alignment will allow us to care more deeply for guests, customers, and especially hotel owners across each of our brands, further deepening preference for Hyatt while creating even more value for shareholders. I would like to close by expressing my gratitude for all Hyatt colleagues who live our purpose every day by caring for each other and for all of our stakeholders. Joan will now provide more details on our operating results. Joan, over to you.