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Choice Hotels Executes 25% More New Construction
and Conversion Contracts in the First Half of 2004
than for Same Period a Year Ago

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Silver Spring, MD (July 29, 2004) – Choice Hotels International (NYSE:CHH)  executed 25 percent more new contracts in the first half of 2004 than were executed during the same time period a year ago --the best first half year results since the company went public in 1996.
 
New construction projects and contracts for conversion to Choice brands each realized a 25 percent year-to-date increase over 2003.  Franchise sales during the second quarter were particularly strong, with a 31 percent increase in new contracts executed over the same quarter in 2003.  Executed contracts in June alone the best results for that month in more than ten years.

“No matter how you measure it, our business thus far in 2004 has been phenomenal,” said Joe Squeri, Choice Hotels’ executive vice president and CFO.  “This is due in part to the recovering economy.  Certainly, it is due in large part to the franchise sales team we have 

Revenues generated via Choice Hotels International’s central reservations system (CRS) were up 7.3 percent in June 2004 versus June 2003, while CRS-revenues for the month of July are already tracking at a 7.9 percent increase over July 2003.

The highest revenue day of the year thus far was Monday, July 12, with just under $7 million in reservations booked through the CRS – the highest revenue day since July 2000.  Revenue has topped $6 million per day 18 times thus far this year – double the number of $6 million days experienced in 2003 year-to-date.  Likewise, the number of $5 million revenue days has doubled this year over last, from 26 year-to-date in 2003 to 52 year-to-date in 2004.

In particular, revenues generated via the company’s proprietary web site, Choicehotels.com, is up – a full 37.4 percent year-to-date over the same period in 2003.

 
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“But most significantly, this surge in development activity is due to the exceptional demand for our brands in the marketplace,” Squeri said.  “For both new construction hotels and conversion projects, we offer brand names that are recognized and respected throughout the world – and that are backed by Choice Hotels’ exceptional services, marketing power and reservations delivery.”

Growth among Choice Hotels’ new construction brands was extraordinarily strong, with Sleep Inn experiencing a 225 percent increase in year-to-date sales versus 2003 and Comfort Suites experiencing a 67 percent increase.   According to David Pepper, vice president, franchise sales, these results are particularly notable when measured against the industry.  “According to Smith Travel Research, total development of new hotels was down almost 19 percent for the first four months of 2004 when compared to the same period in 2003,” Pepper said.  “This makes it particularly gratifying to see a 25 percent increase in new construction contracts for our brands thus far this year.”

Ron Burgett, vice president franchise sales for Choice’s fullservice and economy brands, reports similarly robust system growth for conversion brands.  “We’ve seen a 38 percent increase in conversions to the Econo Lodge brand  – with June going into the record books as the strongest month for Econo Lodge sales in Choice Hotels’ history as a public company,” he said.  “Quality and Clarion also had tremendous growth in the first half of 2004, with 33 percent and 23 percent increases, respectively.”

Choice Hotels International franchises more than 4,800 hotels open in the United States and 41 other countries and territories under the Comfort Inn, Comfort Suites, Quality, Sleep Inn, Clarion, MainStay Suites, Econo Lodge, and Rodeway Inn brand names.


 
Contact:
Anne Papa Curtis
Tel:  (301) 592-5155
Anne_curtis@choicehotels.com
Also See: Choice Hotels Promotes Joseph M. Squeri to Executive Vice President and Chief Financial Officer / May 2004
Choice Hotels Adds 41,000 Franchise Rooms in 2003; Reports 342 Conversions and 128 New Construction Contracts / January 2004


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