Wyndham Hotels & Resorts, Inc.

Please stand by. Your program is about to begin. If you need assistance on today's call, please press star zero. Welcome to the Wyndham Hotels and Resorts second quarter 2022 earnings conference call. At this time, all participants have been placed on a listen-only mode, and the floor will be open for your questions following the presentation. If you would like to ask a question at that time, please press star 1 on your telephone keypad. If at any point your question has been answered, you may remove yourself from the queue by pressing the pound key. Lastly, if you should require operator assistance, please press star 0. I would now like to turn the call over to Matt Capuzzi, Senior Vice President of Investor Relations.

Thank you, Operator. Good morning, and thank you for joining us. With me today are Jeff Belotti, our CEO, and Michelle Allen, our CFO. Before we get started, I want to remind you that our remarks today will contain forward-looking statements. These statements are subject to risk factors that may cause our actual results to differ materially from those expressed or implied. These risk factors are discussed in detail in our most recent annual report on Form 10-K filed with the Securities and Exchange Commission and any subsequent reports filed with the SEC. We'll be referring to a number of non-GAAP measures. Corresponding GAAP measures and a reconciliation of non-GAAP measures to GAAP metrics are provided in our earnings release, which is available on our investor relations website at investor.windomhotels.com. We are providing certain measures discussing future impact on a non-GAAP basis only, because without unreasonable efforts, we are unable to provide the comparable GAAP metrics. In addition, last evening, we posted an investor presentation containing supplemental information on our investor relations website. We may continue to provide supplemental information on our website in the future. Accordingly, we encourage investors to monitor our website in addition to our press releases, filing submitted with the SEC, and any public conference calls or webcasts. With that, I'll turn the call over to Jeff.

Thanks, Matt, and thanks, everyone, for joining us this morning. We're pleased to report another very strong quarter, where global REVPAR grew 23% to last year and 3% to 2019. Here in the United States, REVPAR grew 15% year-over-year, and internationally, REVPAR grew nearly 60%. July month-to-date domestic REVPAR is running 6% ahead of where it was back in 2019. And internationally, our EMEA, Canada, and LATAM regions are all running ahead. Our guests are staying longer and spending more at our hotels than they did in 2019. And importantly, our booking windows continue to increase. Consumer intent to travel and their willingness and ability to spend remains healthy despite the broader economic concerns. We grew net rooms by 3% and our development pipeline by 9% to a record 208,000 rooms. We delivered $175 million of adjusted EBITDA, more than we delivered in the second quarters of both last year and 2019, generating nearly $100 million of free cash flow. And we returned $170 million to our shareholders, bringing our year-to-date capital return to approximately $240 million, or 3% of our market cap. We grew our development pipeline this quarter by 2% sequentially, and by 9% versus prior year. This marked the eighth consecutive quarter of sequential pipeline growth as we awarded approximately 125 new contracts domestically and over 60 contracts internationally, which in total account for more than 22,000 new rooms. The number of domestic contracts signed was approximately 75% higher than what we awarded both last year and back in the second quarter of 2019. Importantly, we awarded contracts to develop another 22 hotels for our recently launched new construction extended stay brand, which brings the total number of Project ECHO contracts awarded to 72 since its launch four short months ago. We grew our overall system by 1% sequentially and by 3% versus prior year. We opened more rooms than last year and once again improved our retention rate as terminations were 200 basis points lower than last year. These results were in line with our expectation and position us solidly on track to achieve our full year net room growth outlook of 2% to 4%. Here in the United States, we grew our system size by 2% year over year, and by 10 basis points sequentially, opening another 6,300 rooms in the quarter, including our first dual-branded La Quinta Hawthorne Suites Hotel in Pflugerville, Texas, the Wyndham Moline on John Deere Commons in Illinois, and the Origin Hotel in Austin, Texas, which joined our full-service upscale Wyndham brand this past June. Internationally, net rooms grew 2% sequentially and by more than 4% versus prior year. Notably, our Latin America region grew its system size by 12% compared to prior year, which included the addition of four luxury registry collection resorts with over 1,500 rooms in Mexico under long-term franchise agreements with the Palladium Hotel Group. As part of this strategic alliance signed just this month, another 5,000 franchised rooms will be added to our portfolio throughout the remainder of 2022, bringing the total to 15 upper-upscale and luxury palladium hotels and resorts in Mexico, Brazil, Jamaica, and the Dominican Republic, joining our registry collection and trademark hotel collection by Wyndham. Our China direct franchising business grew its system size by 12%, including the opening of the beautiful new construction Wyndham Garden Kanming, our first Wyndham Garden in Yunnan Province. Our Southeast Asia and Pacific Rim region grew net rooms by 3%, which included the introduction of our Microtel brand in New Zealand with the opening of the Microtel Wellington and our first trademark by Wyndham in Vietnam. Trademark is a brand that has grown to more than 150 hotels globally in the past five years, and it's a brand that now has another 80 hotels currently in its pipeline. And finally, our EMEA region grew net rooms by 2%, including the addition of our first trip by Wyndham in Greece. Our award-winning Wyndham Rewards loyalty program continues to be recognized as the number one hotel rewards program by both U.S. News and World Report and USA Today. The program grew domestic enrollments by 8% versus prior year and by 25% versus where it stood pre-pandemic. Total membership now stands at over 95 million members. An awareness of the program increased by another 100 basis points compared to 2021, placing it among the top three most recognized of the industry's 13 major loyalty programs tracked by MarketCast. Domestically, nearly one out of every two check-ins are asking for their Wyndham Rewards points at check-ins, with brands like La Quinta now approaching a 55% Wyndham Rewards share of occupancy. Revenue generated from direct bookings on our brand.com sites grew nearly 30% in the quarter compared to 2021, outpacing the rate of growth across all third-party channels, driven in large part by the Wyndham Rewards loyalty program. And we're making it easier and more convenient than ever for guests to book their vacations through the five-star rated Wyndham app, which has seen a 30% growth in downloads since last year. This quarter, we launched Road Trip Planner on the app, the first ever of its kind. With its real-time functionality, guests can tell us where they want their trip to begin and where they want their trip to end. The app then provides recommendations for overnight stays along the way based on how long or how far they want to drive each day. It lets the guests choose their desired stops. They can set hotel preferences by price or by brand. They could filter their by Wyndham Hotel selections based on multiple criteria like whether or not the hotel accepts pets or has, for example, truck parking. And within minutes, they could book multiple stays in the same booking flow and even pay for their rooms with their Wyndham Reward points with cash or with a combination of both cash and points. We're seeing tremendous adoption since its launch in May with guests having spent thousands of hours planning their trips. The longest trip planned so far being over 4,700 miles with multiple stays at Wyndham hotels along the way. From an ESG and a development standpoint, we are building on our commitment to encouraging diverse hotel ownership. We were the first major hotel company to launch a program focusing on women's advancement via our Women Own the Room program. Well now, Wyndham has become the first major hotel company to launch a similar program focused specifically on the advancement of black entrepreneurs. Two weeks ago, we announced our newest development program, Bold by Wyndham at NABHUD, the National Black Hotel Owners, Operators, and Developers Annual Association Summit Meeting in Miami. While black employment in the U.S. hotel industry is nearly 20%, less than 2% of the nation's hotel owners are black. BOLD, which stands for Black Owners and Lodging Developers, aims to engage and advance more black entrepreneurs on their journey to hotel ownership, and interest in the program to date has exceeded our expectations. Diversity and inclusion have always been a cornerstone of the Wyndham culture, and these initiatives prove they are also advantageous from a business standpoint. All of the development efforts and awards are supported by Wyndham's dedicated ABGs, or affinity business groups, who along with our DE&I team continue to drive awareness and allyship throughout our organization. Over the past few years, our teams around the world have made tremendous progress in simplifying our operating model. We negotiated an exit for our Select Service Management business and sold our two owned hotels. And importantly, we were able to lock in long-term franchise agreements at full fees on all of these hotels. In a moment, Michelle will discuss our intended use of the related proceeds from these transactions. At a time when our brands are performing at record levels and continuing to gain market share versus how they performed pre-COVID, our business model has never been more straightforward. Ninety-nine percent of our 9,000 hotels are now franchised. limiting our exposure to operating costs and capital requirements, and allowing our teams to focus on the higher margin cash-generating franchise business that we've been so successful at over the past 30 years. And with that, I'll turn the call over now to Michelle. Michelle?