Wyndham Hotels & Resorts, Inc. (WH) Earnings Call Transcript & Summary

Welcome to the 2020 Annual Meeting of Stockholders for Wyndham Hotels & Resorts. [Operator Instructions] I'd now like to turn the call over to Paul Cash, General Counsel and Corporate Secretary of Wyndham Hotels & Resorts. Mr. Cash, you may begin.

Good morning, everyone. Welcome to our 2020 Annual Meeting of Stockholders, and thank you for joining our virtual meeting today. Before we begin the formal portion of the meeting, let me please call your attention to the agenda and rules of conduct that are available on our virtual meeting screen. We plan to conduct the meeting according to the agenda and ask that you please abide by the rules of conduct. The formal business portion of the meeting will be conducted by our Chairman, Steve Holmes. And then our President and Chief Executive Officer, Geoff Ballotti, will proceed with a general question-and-answer session. Stockholders may submit questions at any time during this meeting in the ask-a-question field that appears on the virtual meeting screen for the general question-and-answer session. And now to begin the formal portion of the meeting, I am pleased to introduce Steve Holmes, Chairman of Wyndham Hotels & Resorts.

Thank you, Paul, and good morning, ladies and gentlemen. In accordance with the Notice of the Meeting, I would like to call this meeting to order. Along with my fellow directors and the executive officers of Wyndham Hotels & Resorts, I'd like to welcome you to our annual meeting of stockholders, and thank you for taking the time to join us today and participate in this meeting virtually. As you are aware, we decided to hold our annual meeting in a virtual-only format due to the novel coronavirus pandemic in order to protect the health and well-being of our stockholders and team members. We hope that you and your families are safe and healthy. And with that, I would like to turn to a few introductions. First, in addition to Paul Cash, who you heard a moment ago, I'd like to introduce Geoff Ballotti, President and Chief Executive Officer; and Michele Allen, Chief Financial Officer; and thank the other members of our executive management team, who have also joined us today. Next, I would like to recognize the members of our Board of Directors who are in attendance today. We welcome Myra Biblowit, Jim Buckman, Bruce Churchill, Mukul Deoras, Ron Nelson and Pauline Richards. On behalf of the stockholders, I want to thank our directors for their significant dedication and commitment to the company and its stockholders and the enormous work that they've undertaken during this pandemic. Also attending this meeting are representatives from Deloitte & Touche LLP, our independent auditors. John Zamora is available to respond to any appropriate questions that you may have. At this point, I'd like to call upon Paul Cash, our Corporate Secretary, to give his report.

Thank you, Mr. Chairman. In order to conduct the formal business of the meeting, it is necessary to establish that Notice of the Meeting was duly and properly mailed and that a quorum is present. To this end, the company has appointed Tom Tighe as the inspector of election for this meeting who is in attendance today. Tom has previously signed a note to execute the duties of inspector of election with strict impartiality and according to the best of his ability, which will be filed with the minutes of this meeting. Now for the establishment of the meeting requirements. I have an affidavit of mailing from Broadridge Financial Solutions certifying as to the giving of notice of this meeting and of sending to stockholders of record as of March 17, 2020, the notice of Internet availability of proxy materials commencing on April 1, 2020. I also have copies of the 2019 annual report and proxy statement, copies of which were sent or made available to each stockholder entitled to vote at this meeting. Electronic copies of the annual report and the proxy statement are available on the website used to access this meeting. The Notice of Meeting, proxy statement and the affidavit of mailing, together with the attachments thereto, and the 2019 annual report will be filed with the minutes of this meeting. In addition, I have the list of the holders of record as of March 17, 2020, which is available for inspection by any stockholder during this meeting on the website used to access this meeting. A copy of the list of stockholders will be filed with the minutes of this meeting. With respect to the establishment of a quorum, the inspector of election has reported that the holders of more than a majority of the total shares of common stock entitled to vote are represented at this meeting, and therefore a quorum is present. Please note that your designated proxies are present this morning and that you do not need to submit your vote through the virtual meeting screen if you previously sent in your proxy or voted. Please remember that only stockholders of record as of the close of business on March 17 may vote at this meeting. Thank you for your cooperation. Mr. Holmes, our Board Chairman, will now conduct the formal business of the meeting.

As stated in the proxy statement for this meeting, we have 4 proposals for consideration by our stockholders, and the Board of Directors have recommended a vote for the proposals 1, 2, 3 and 4, all 4 of them. The polls are open for voting. The 4 proposals for your consideration today are: #1 proposal is the election of our 3 Class 2 directors, that's Myra J. Biblowit, Bruce B. Churchill and Pauline D.E. Richards, to serve until the 2021 annual meeting of stockholders of the company and until their successors are duly elected and qualified. Proposal #2 is to vote on -- a vote in 2 parts on amendments to our amended and restated Certificate of Incorporation to eliminate the supermajority voting requirements relating to amendments to our amended and restated Certificate of Incorporation and amended and restated bylaws and the removal of directors, those 2 supermajority required votes. Proposal 3 is the approval of an advisory resolution to approve our executive compensation program. And proposal #4 is the ratification of the appointment of Deloitte & Touche LLP to serve as Wyndham Hotels & Resorts' independent registered public accounting firm for the year ended December 31, 2020. That concludes the matters to be voted upon. I will pause for a brief moment to allow stockholders to finish voting. [Voting]

Okay. In accordance with our amended and restated bylaws, I hereby declare the polls for voting for this meeting to be closed. The inspector of elections will deliver his preliminary report to Mr. Cash, our Corporate Secretary, who will provide the preliminary voting results.

Thank you, Mr. Chairman. I have received the preliminary tabulation from Broadridge. And based on that tabulation, I am pleased to report that all of the Class 2 director nominees were elected, and the other 3 proposals were approved by the requisite thresholds. With the conclusion of the official business, the meeting is now adjourned. The final voting results of today's meeting will be reported in a Form 8-K filed within 4 business days of this meeting. I will now turn the meeting over to Geoff Ballotti, our President and Chief Executive Officer, who will lead a brief question-and-answer session. Please note that we will answer as many questions from stockholders as time allows.

Thank you, Paul. Good morning, everybody, and we would now like to open the line for questions from stockholders. If you have a question, please submit it through the ask-a-question field that appears on the virtual meeting screen, and Mr. Cash, our Corporate Secretary, will read the appropriate questions out loud. Paul, have any questions so far been submitted?

Yes. Our first question is, will hotels such as yours need to band together and create proprietary technology for the hotel industry? Will touchless be the way going forward?

Thank you for the question. And yes, absolutely, hotels in our industry today, we are already banding together, creating technology that will allow touchless solutions for our industry. We are providing training to all of our franchisees, following all of the CDC guidelines. They have been embraced by our franchisees and our franchisee advisory council members. We have launched our Count on Us Clean and Safe Committee, which embraces sanitation procedures, transmission barriers and touchless solutions for our hotels, including new food and beverage service guidelines, which will be providing single-use plastic and the ability to not be touching surfaces or silverware within our hotels wherever possible.

Thank you, Mr. Ballotti. The second question is, how many shareholder attendees are at this virtual meeting? And will your meeting be virtual next year?

Paul, I will ask you to respond to the first part of that question. The second part, we would hope that our meeting will be back face-to-face next year at our world headquarters at 22 Sylvan Way.

And as to the first part of the question, as of this moment in time, we have recorded the attendance of 11 shareholders.

Thank you, Paul.

The third question, Mr. Ballotti, how will you assure hotel guests going forward that it is safe? And what will your occupancy be due to COVID as to what you are legally allowed?

We are doing everything we possibly can today within our managed hotels to ensure that they are clean and safe and working with our franchisees providing training to ensure, again, that they're following all CDC guidelines. Within our managed hotels, we have reduced our room cleanings to stay-over requests from guests. We have closed fitness centers, pools and buffets for the time being. We have installed front-desk shields, and we're monitoring all of our frontline team members. To date, across our 11,000 employee team member base, we have less than 20 confirmed cases. And all have recovered or are recovering. And 96% of our hotels in the United States today are open and operating and running occupancy levels above 30%.

Our fourth question, Mr. Ballotti. Will the company's view on dividend change?

Our company's view on dividends moving forward will be, as we said on our earnings call this week, to continue to pay our quarterly dividend and look to increase the dividend that we are -- we have indicated we will be paying going forward.

At this time, we have no further questions.

Thank you, Paul, and thank you, ladies and gentlemen, for attending Wyndham Hotels & Resorts 2020 Annual Shareholder Meeting. And on behalf of all of us at Wyndham Hotels & Resorts, we would like to reiterate that we hope that you and your families are safe and healthy. Operator?

This now concludes the meeting. Thank you for joining, and have a pleasant day.