Marsh & McLennan Companies, Inc.

Welcome to Marsh McLennan's conference call. Today's call is being recorded. First quarter 2022 financial results and supplemental information were issued earlier this morning. They are available on the company's website at marshmclennan.com. Please note that remarks made today may include forward-looking statements. Forward-looking statements are subject to risks and uncertainties, and a variety of factors may cause actual results to differ materially from those contemplated by such statements. For a more detailed discussion of those factors, please refer to our earnings release for this quarter and to our most recent SEC filings, including our most recent Form 10-K, all of which are available on the Marsh McLennan website. During the call today, we may also discuss certain non-GAAP financial measures. For reconciliation of these measures to the most closely comparable GAAP measures, please refer to the schedule in today's earnings release. I'll now turn this over to Dan Glazer, President and CEO of Marsh McLennan.

Thank you. Good morning, and thank you for joining us to discuss our first quarter results reported earlier today. I'm Dan Glazer, President and CEO of Marsh McLennan. Joining me on the call today is John Doyle, our Group President and COO, Mark McGivney, our CFO, and the CEOs of our businesses, Martin South of Marsh, Dean Klasora of Guy Carpenter, Martine Furlong of Mercer, and Nick Studer of Oliver Wyman. Also with us this morning is Sarah DeWitt, Head of Investor Relations. Marsh McLennan started 2022 strong, and we are well positioned for another good year. Our top-line momentum continued. We generated the fourth consecutive quarter of double-digit underlying growth and the highest first quarter underlying growth in over two decades. with each of our businesses showing strength. Our adjusted operating income grew 12 percent. This comes despite a tough comparable of 20 percent growth in the first quarter of 2021. Adjusted EPS growth was 16 percent, the fifth consecutive quarter of double-digit growth, and we saw modest margin expansion despite the substantial investments we made in organic hiring last year. Overall, a strong start to the year. At Marsh McLennan, advancing good in the world is important to us. In our view, great companies have to not only do well and deliver for investors, but also do good and make a broader contribution to society. We believe in order to deliver long-term value for shareholders, we also have to be a good employer, a good global citizen, and bring our best to our clients. We are proud of our track record on ESG and recently released our second environmental, social, and governance report. Our report highlights the many ways in which we are confronting the most complex ESG challenges of our time, both within our own company and on behalf of clients. We made progress on several ESG initiatives. For example, We are committed to energy transition and achieved a carbon neutral certification in 2021. We also declared a new goal of being net zero by 2050 with a target of reducing carbon emissions 50% by 2030. We are committed to inclusion and diversity. We launched our Inclusion and Diversity Center of Excellence and enhanced our D&I disclosure in the areas of pay equity, workforce representation, and talent flows. And we added Gaia Erkin to our board of directors, furthering our commitment to increase gender diversity on our board. We are also working across our businesses to help clients address the broad spectrum of complex ESG issues, such as climate change, diversity and inclusion, affordable healthcare, cybersecurity, and sustainable investing, among others. I want to highlight several recent examples of how we are developing ESG solutions for clients. Marsh launched the new Directors and Officers Liability Insurance Initiative that recognizes U.S.-based clients with superior ESG frameworks. Guy Carpenter arranged Flood Smart Re catastrophe bonds for FEMA to secure capital markets-based flood reinsurance coverage for its NFIP program. These bonds help FEMA pay for NFIP claims when disaster strikes. Mercer continues to be a leader in helping firms quantify and address pay equity, as well as diversity and inclusion challenges. As an example, our recently released Stepping Up for Equity study provides insights on closing the opportunity gap for black Americans. Oliver Wyman helped clients pursue commercially viable climate transitions working with CDP, the World Economic Forum, the United Nations, and others to set new agendas and build consensus on the issue of climate change. We are also helping clients develop low-carbon business models and manage risks associated with the transition from fossil fuels to renewable energy. As we do our part to accelerate this transition, We recognize that a secure energy supply is crucial for the global economy and society as a whole. This is especially true in the context of today's geopolitical environment. We believe all communities are best served by working with both operators of clean energy assets and traditional energy companies to make the transition as quickly and smoothly as possible. The work we are doing across all of these ESG related areas has a direct impact on the communities where we live and operate. We are making a difference through disaster mitigation and recovery, promoting healthy societies, and diversity and inclusion. Overall, ESG continues to be an area where we see both significant growth potential and an opportunity to benefit our clients, colleagues, and communities. I'd like to take a moment to comment on the war in Ukraine. We strongly condemn the Russian government's invasion of Ukraine and are horrified by the tragic human toll this war is taking. On March 10th, we announced the decision to exit our business in Russia. In a minute, John will provide more detail on steps we've taken to support colleagues and serve our clients during this crisis. Turning to current economic conditions and the outlook for the rest of 2022, we see a picture with greater risks and uncertainties than when we entered the year. That said, we continue to see an environment that is supportive of growth. Based on our current outlook, we continue to expect mid-single-digit or better underlying revenue growth for the full year. We also expect solid growth in adjusted EPS and to extend our track record of annual margin expansion. Macro challenges like supply chain pressures, energy market and commodity dislocations, rising cybersecurity concerns, and future of work create demand for our services and opportunities to help clients. We also believe that over the long term, demand for our solutions will remain strong given rising levels of complexity, volatility, and uncertainty across the business landscape. With that, let me turn it over to John for his comments on the quarter.

Thanks, Dan, and good morning, everyone. Our first quarter results were strong. We had double-digit underlying revenue growth with all businesses positively contributing, and our adjusted operating income hit a record level in the first quarter. Our strong start positions us well for 2022, despite greater uncertainty about the macroeconomic outlook. Before I discuss market trends and our performance, I want to comment on our response to the crisis in Ukraine. As Dan noted, we condemn the Russian aggression, and we are saddened by the human suffering the war in Ukraine has caused. Our primary concern is the well-being of colleagues affected by this crisis. We took a number of steps to assist them, including providing evacuation support for Ukrainian colleagues and creating assistance programs in Poland and Ukraine. In addition, we've established a humanitarian relief fund to help the Ukrainian people. We're also bringing our capabilities and risk strategy and people to support clients as they grapple with the challenges of this conflict and its wider economic effects. Oliver Wyman is helping clients in the public and private sectors manage a wide scope of issues. We are working on government security and defense matters, helping a number of banks manage their exposure to the region, supporting energy clients with their supply chain considerations, and assisting large manufacturers as they manage the risk of production shutdowns. Marsh is advising clients on risks around aircraft nationalization, cybersecurity, physical assets, supply chain, and transitioning away from Russian energy. Mercer is helping clients deal with capital market volatility, asset allocation, and Russian exposures. We're also working to provide continued health coverage for Ukrainians leaving the country. Guy Carpenter is helping clients understand their exposures, portfolio concentrations, and reinsurance recoveries. We're also advising clients on the complexities around sanctions and cause of loss, number of occurrences, and claims aggregation. I'm extremely proud of how our firm has responded to this crisis. Overall, we are harnessing the power of Marsh McLennan to help our colleagues and our clients in this moment that matters. Now, let me provide an update on current P&C insurance market conditions. Rate increases in the marketplace continue to persist, reflecting losses and concerns about the impact of inflation on claims and a firm reinsurance market. The March global insurance market index showed price increases of 11% year over year. This marks the 18th consecutive quarter of rate increases in the commercial P&C insurance marketplace. Looking at pricing by line, The Marsh Market Index showed global property insurance was up 7% and global casualty rates were up mid-single digits on average. Global financial and professional lines, excluding cyber, increased high single digits, while cyber rates more than doubled in some geographies. As a reminder, our index skews the large account business. However, small and middle market insurance rates continue to rise as well, although less than for large, complex accounts. Turning to reinsurance, April 1 renewals largely reflected a continuation of the January 1 pricing environment. The industry remains well capitalized, but finding capacity is challenging in specific segments. This reflects ongoing and emerging issues such as the frequency of severe events, cyber, climate change, and core and social inflation. Overall, at April 1, U.S. property catastrophe rates were up in the high single digits for non-loss impacted accounts. while loss-impacted accounts generally increased in a range of 10% to 30%. U.S. cyber rates were up mid-teens or higher, depending on loss activity. Japanese property catastrophe rates increased low single digits. We remain focused on helping clients navigate challenging insurance and reinsurance markets and the evolving risk environment. Turning to our performance in the quarter, as I noted earlier, Marsh McLennan had strong results. In the first quarter, we had double-digit underlying revenue growth in both RIS and consulting. Adjusted operating income grew 12% on top of 20% in the first quarter of 2021, a terrific result. The first quarter marks the fourth consecutive quarter of double-digit underlying revenue growth, the longest stretch in over two decades. Looking at risk and insurance services, first quarter revenue was $3.5 billion, up 10% compared with a year ago, or 11% on an underlying basis. This is the third quarter in the last 12 months risk in insurance grew 10% or better, the best trend since 2003. Adjusted operating income increased 12% to $1.2 billion, while our adjusted operating margin declined 10 basis points to 36.5%, reflecting investments in the business. At Marsh, revenue in the quarter was $2.5 billion, up 10% compared with a year ago. Revenue growth was 11% on an underlying basis. We had excellent renewal growth, and we continue to see strong new business. U.S. and Canada had 10% underlying revenue growth. This marks the U.S. and Canada's fourth consecutive quarter of double-digit underlying revenue growth. International was also strong with underlying revenue growth of 11%. Asia Pacific was up 17%, Latin America grew 16%, and EMEA was up 9%. Guy Carpenter's first quarter revenue was $1 billion, up 11% on an underlying basis, driven by strong growth in new business and exceptional retention. Guy Carpenter has now achieved underlying revenue growth of over 10% in three of the last four quarters. In the consulting segment, revenue of $2 billion was a first quarter record, up 7% from a year ago, or 10% on an underlying basis. This is the fourth consecutive quarter of 10% or higher growth. Adjusted operating increased 9% to a first quarter record of $402 million. The adjusted operating margin was 20.6% of 10 basis points versus a year ago. Mercer's revenue was $1.3 billion in the quarter of 6% on an underlying basis, the fourth consecutive quarter of 6% or higher growth. Career grew 16% on an underlying basis. We continue to see robust demand for solutions linked to new ways of working and skills gaps, workforce transformation, and D&I issues like pay equity. Health underlying revenue growth was strong at 9% in the quarter, reflecting growth across all geographies. This quarter's results benefited from strong demand for our services, higher retention, rising employment, and medical inflation. Wealth increased 2% on an underlying basis, reflecting modest growth in both investment management and defined benefits. Our assets under management were $388 billion at the end of the first quarter, down 7% sequentially as net inflows were more than offset by capital market declines. However, compared to the first quarter last year, AUM was up 2%. Oliver Wyman's momentum continued despite starting to lap tougher comparables to an outstanding 2021. Revenue in the first quarter was $667 million, an increase of 17% on an underlying basis. This represents the fifth consecutive quarter of double-digit growth and reflects continued strong demand across all geographies. Overall, I'm pleased with our excellent first quarter performance, and it sets us up for a good year. Now I'll turn the call over to Mark for further detail on our financial results and a discussion of our outlook for the rest of 2022. Thank you, John.