SILVER SPRING, Md.,
Feb. 21, 2011 --Choice Hotels
International, Inc., (NYSE: CHH) today reported the following
highlights for fourth quarter and full year 2010:
Full Year Results
- Adjusted diluted earnings per share ("EPS")
for full year 2010 were $1.82 compared
to $1.71 for full year 2009. Diluted EPS
were $1.80 for 2010 compared to $1.63 for 2009. Adjusted diluted EPS for full
year 2010 and 2009 exclude certain special items, as described below,
totaling $0.02 and $0.08, respectively.
- Excluding special items, adjusted earnings
before interest, taxes, depreciation and amortization ("EBITDA")
increased 4% to $170.8 million for the
year ended December 31, 2010, compared
to $163.7 million for the year ended December 31, 2009. Operating income for the
year ended December 31, 2010 was $160.8 million compared to $148.1 million for the same period of 2009.
- Franchising revenues increased 3% from $254.7 million for the year ended December 31, 2009 to $262.8
million for the same period of 2010. Total revenues increased $31.9 million or 6% to $596.1
million for the year ended December 31,
2010 compared to the same period of 2009.
- Adjusted selling, general and administrative
("SG&A") expense for full year 2010 totaled $92.8
million which represented a 1% increase from the same period of
the prior year. Adjusted SG&A costs exclude special items totaling $1.7 million and $7.3
million for the years ended December 31,
2010 and 2009, respectively.
- Interest and other investment income for the
year ended December 31, 2010 declined by
approximately $3.0 million from the same
period of the prior year primarily due to less appreciation in the fair
value of investments held in the company's non-qualified employee
benefit plans compared to the prior year.
- The effective income tax rate for the year
ended December 31, 2010 was 32.1%
compared to 34.8% for the same period of the prior year. Excluding
certain items, totaling $3.2 million
(approximately $0.05 diluted earnings
per share), recorded during the year ended December
31, 2010, the company's effective income tax rate was
approximately 34.1%.
- Domestic unit and room growth increased 1.8%
and 1.3%, respectively, from December 31, 2009.
- Domestic system-wide revenue per available
room ("RevPAR") increased 2.8% for full year 2010 compared to the same
period of 2009 primarily as a result of occupancy rates increasing 190
basis points.
- The effective royalty rate increased 4 basis
points to 4.29% for the year ended December 31,
2010 compared to 4.25% for the same period of the prior year.
- The company executed 357 new domestic hotel
franchise contracts representing 30,305 rooms for the year ended December 31, 2010 compared to 369 new domestic
hotel franchise contracts representing 30,156 rooms in the prior year.
- The number of domestic hotels under
construction, awaiting conversion or approved for development declined
29% from December 31, 2009 to 516 hotels
representing 41,682 rooms; the worldwide pipeline declined 26% from December 31, 2009 to 621 hotels representing
50,787 rooms.
Fourth Quarter Results
- Adjusted diluted earnings per share ("EPS")
for fourth quarter 2010 were $0.42
compared to $0.43 for the same period of
the prior year. Diluted EPS were $0.40
for both fourth quarter 2010 and 2009. Adjusted diluted EPS for fourth
quarter 2010 and 2009 exclude certain special items, as described
below, totaling $0.02 and $0.03, respectively.
- Excluding special items, adjusted earnings
before interest, taxes, depreciation and amortization ("EBITDA") were $41.5 million for the three months ended December 31, 2010, compared to $39.7 million for the same period of 2009.
Operating income for the three months ended December
31, 2010 and 2009 was $38.4 million
and $34.1 million, respectively.
- Franchising revenues increased 7% from $62.2 million for the three months ended December 31, 2009 to $66.9
million for the same period of 2010. Total revenues for the
three months ended December 31, 2010
increased 10% compared to the same period of 2009.
- Domestic system-wide revenue per available
room ("RevPAR") increased 9.7% for the fourth quarter of 2010 compared
to the same period of 2009 as a result of occupancy rates increasing
420 basis points and average daily rates increasing 0.6%.
- The effective royalty rate increased 3 basis
points to 4.31% for the three months ended December
31, 2010 compared to 4.28% for the same period of the prior
year.
- The company executed 161 new domestic hotel
franchise contracts for the three months ended December
31, 2010 an increase of 44% over the prior year period. The
increase in franchise sales was primarily driven by our Quality,
Clarion and Econo Lodge conversion brands.
- Interest expense for the three months ended December 31, 2010 increased $2.8 million to $3.5 million from the same
period of the prior year primarily as a result of the company's
issuance of $250 million in unsecured
senior notes on August 25, 2010 which
carry an effective interest rate of approximately 6.2%. The proceeds
from these senior notes were utilized to repay other outstanding
indebtedness under the company's unsecured revolving credit facility.
"We are extremely pleased with our fourth quarter
performance, with strong gains in domestic RevPAR and a significant
year-over-year increase in new domestic hotel franchise agreements,"
said Stephen P. Joyce, president and
chief executive officer. "We fully anticipate that 2011 will be an even
better year for our industry and our company. With a mix of
well-segmented brands for both consumers and developers, powerful
global distribution capabilities and a rapidly growing global loyalty
program, we are poised to take advantage of a better operating
environment."
Special Items
During the three months and year ended December 31, 2010, the company recorded
employee termination benefit charges of approximately $1.2 million and $1.7
million, respectively. These special items represent diluted EPS
of $0.02 for both the three months and
year ended December 31, 2010.
During the three months and year ended December 31, 2009, the company recorded
employee termination benefits of approximately $2.3
million and $4.6 million,
respectively. The company also incurred a curtailment loss related to
freezing the benefits payable under its Supplemental Executive
Retirement Plan totaling $1.2 million
for the three months and year ended December
31, 2009. In addition, during the year ended December 31, 2009, the company recorded a $1.5 million charge related to the sublease of
a portion of its office space. These special items represent diluted
EPS of $0.03 and $0.08
for the three months and year ended December
31, 2009, respectively.
Outlook for 2011
The company's first quarter 2011 diluted EPS is expected
to be $0.25. The company expects
full-year 2011 diluted EPS to range between $1.71
and $1.75. EBITDA for full-year 2011 are expected to range
between $180 million and $183 million.
These estimates include the following assumptions:
- The company expects net domestic unit growth
of approximately 1% in 2011;
- RevPAR is expected to increase approximately
5% for first quarter of 2011 and increase approximately 4% for
full-year 2011;
- The effective royalty rate is expected to
increase 3 basis points for full-year 2011;
- All figures assume the existing share count
and an effective tax rate of 35% for the first quarter and full-year
2011.
Use of Free Cash Flow
The company has historically used its free cash flow
(cash flow from operations less capital expenditures) to return value
to shareholders, primarily through share repurchases and dividends.
For the year ended December 31,
2010 the company paid $43.8 million
of cash dividends to shareholders. The current quarterly dividend rate
per common share is $0.185, subject to
declaration by our board of directors.
During the year ended December
31, 2010, the company purchased approximately 0.3 million shares
of its common stock at an average price of $32.36
for a total cost of $8.7 million under
the share repurchase program and has authorization to purchase up to an
additional 3.6 million shares under this program. We expect to continue
making repurchases in the open market and through privately negotiated
transactions, subject to market and other conditions. No minimum number
of share repurchases has been fixed. Since Choice announced its stock
repurchase program on June 25, 1998, the
company has repurchased 43.2 million shares of its common stock for a
total cost of $1 billion through December 31, 2010. Considering the effect of a
two-for-one stock split in October 2005,
the company had repurchased 76.2 million shares through December 31, 2010 under the share repurchase
program at an average price of $13.35
per share.
Our board of directors previously authorized us to enter
into programs which permit us to offer financing, investment and
guaranty support to qualified franchisees as well as to acquire and
resell real estate to incent franchise development for certain brands
in top markets. Recent market conditions have resulted in an increase
in opportunities to incent development under these programs. As a
result, during the year ended December 31, 2010,
the company has advanced approximately $21.7
million pursuant to these programs (of which $5 million has been repaid to the company).
Over the next several years, we expect to continue to
opportunistically deploy capital pursuant to these programs to promote
growth of our emerging brands. The amount and timing of the investment
in these programs will be dependent on market and other conditions. Our
current expectation is that our annual investment in these programs
will range between $20 million to $40 million.
Notwithstanding these programs, the company expects to continue to
return value to its shareholders through a combination of share
repurchases and dividends, subject to market and other conditions.
Conference Call
Choice will conduct a conference call on Tuesday, February 22, 2011 at 10:00 a.m. EST to discuss the company's fourth
quarter and full-year 2010 results. The dial-in number to listen to the
call is 1-800-638-5495, and the access code is 25896514. International
callers should dial 1-617-614-3946 and enter the access code 25896514.
The conference call also will be Webcast simultaneously via the
company's Web site, www.choicehotels.com.
Interested investors and other parties wishing to access the call via
the Webcast should go to the Web site and click on the Investor Info
link. The Investor Information page will feature a conference call
microphone icon to access the call.
The call will be recorded and available for replay
beginning at 1:00 p.m. EST on February 22, 2011 through March 22, 2011 by calling 1-888-286-8010 and
entering access code 90493436. The international dial-in number for the
replay is 617-801-6888, access code 90493436. In addition, the call
will be archived and available on www.choicehotels.com via the
Investor Info link.
About Choice Hotels
Choice Hotels International, Inc. franchises more than
6,000 hotels, representing more than 495,000 rooms, in the United States and more than 30 other
countries and territories. As of December 31,
2010, more than 500 hotels were under construction, awaiting
conversion or approved for development in the
United States, representing more than 40,000 rooms, and more
than 100 hotels, representing approximately 9,000 rooms, were under
construction, awaiting conversion or approved for development in 18
other countries and territories. The company's Comfort Inn, Comfort
Suites, Quality, Sleep Inn, Clarion, Cambria Suites, MainStay Suites,
Suburban Extended Stay Hotel, Econo Lodge and Rodeway Inn brands serve
guests worldwide. In addition, via its Ascend Collection membership
program, travelers in the United States,
Canada and the Caribbean have upscale lodging options at
historic, boutique and unique hotels.
Additional corporate information may be found on the
Choice Hotels International, Inc. web site, which may be accessed at www.choicehotels.com.
Forward-Looking Statements
Certain matters discussed in this press
releaseconstitute forward-looking statements within the meaning of the
federal securities law. Generally, our use of words such as "expect,"
"estimate," "believe," "anticipate," "will," "forecast," "plan," "
project," "assume" or similar words of futurity identify statements
that are forward-looking and that we intend to be included within the
Safe Harbor protections provided by Section 27A of the Securities Act
of 1933 and Section 21E of the Securities Exchange Act of 1934.
Suchforward-looking statements are based on management's current
beliefs, assumptions and expectations regarding future events, which in
turn are based on information currently available to management. Such
statements may relate to projectionsof the company's revenue, earnings
and other financial and operational measures, company debt levels,
payment of stock dividends, and future operations, among other matters.
We caution you not to place undue reliance on any such forward-looking
statements. Forward-looking statements do not guarantee future
performance and involve known and unknown risks, uncertainties and
other factors.
Several factors could cause actual results, performance
or achievements of the company to differ materially from those
expressed in or contemplated by the forward-looking statements.Such
risks include, but are not limited to, changes to general, domestic and
foreign economic conditions; operating risks common in the lodging and
franchising industries; changes to the desirability of our brands as
viewed by hotel operators and customers; changes to the terms or
termination of our contracts with franchisees; our ability to keep pace
with improvements in technology utilized for reservations systems and
other operating systems; fluctuations in the supply and demand for
hotels rooms; andour ability to manage effectively our indebtedness.
These and other risk factors are discussed in detail in the Risk
Factors section of the company's Form 10-K for the year ended December 31, 2009, filed with the Securities
and Exchange Commission on March 1,
2010.We undertake no obligation to publicly update or revise any
forward-looking statement, whether as a result of new information,
future events or otherwise.
Statement Concerning Non-GAAP Financial
Measurements
Adjusted diluted EPS, adjusted EBITDA, adjusted
SG&A, franchising revenues and adjusted franchising margins are
non-GAAP financial measurements. This information should not be
considered as an alternative to any measure of performance as
promulgated under accounting principles generally accepted in the United States ("GAAP"), such as diluted
earnings per share, operating income, total revenues and operating
margins. The company's calculation of these measurements may be
different from the calculations used by other companies and therefore
comparability may be limited. The company has included an exhibit
accompanying this release that reconciles these measures to the
comparable GAAP measurement. We discuss management's reasons for
reporting these non-GAAP measures below.
Earnings Before Interest, Taxes, Depreciation and
Amortization: EBITDA reflects earnings excluding the impact of
interest expense, tax expense, depreciation and amortization. Our
management considers EBITDA to be an indicator of operating performance
because it can be used to measure our ability to service debt, fund
capital expenditures, and expand our business. EBITDA is a commonly
used measure of performance in our industry. In addition, it is used by
analysts, lenders, investors and others, as well as by us, to
facilitate comparisons between the company and its competitors because
it excludes certain items that can vary widely across different
industries or among companies within the same industry.
Franchising Revenues and Margins: The company
reports franchising revenues and margins which exclude marketing and
reservation revenues and hotel operations. Marketing and reservation
activities are excluded from revenues and operating margins since the
company is contractually required by its franchise agreements to use
these fees collected for marketing and reservation activities.
Cumulative reservation and marketing fees not expended are recorded as
a payable on the company's financial statements and are carried over to
the next fiscal year and expended in accordance with the franchise
agreements. Cumulative marketing and reservation expenditures in excess
of fees collected for marketing and reservation activities are recorded
as a receivable on the company's financial statements. In addition, the
company has the contractual authority to require that the franchisees
in the system at any given point repay the company for any deficits
related to marketing and reservation activities. Hotel operations are
excluded since they do not reflect the most accurate measure of the
company's core franchising business. These non-GAAP measures are a
commonly used measure of performance in our industry and facilitate
comparisons between the company and its competitors.
Adjusted Diluted EPS, Adjusted EBITDA, Adjusted
SG&A and Adjusted Franchising Margins: The company's management
also uses adjusted diluted EPS, adjusted EBITDA, adjusted SG&A and
adjusted franchising margins which exclude employee termination
benefits for the periods ended December 31, 2010
and 2009 as well as a pension plan curtailment loss and a loss on the
sublease of a portion of the company's office space during the periods
ended December 31, 2009. The company
utilizes these non-GAAP measures to enable investors to perform
meaningful comparisons of past, present and future operating results
and as a means to emphasize the results of on-going operations.
Choice Hotels, Choice Hotels International, Comfort
Inn, Comfort Suites, Quality, Sleep Inn, Clarion, Cambria Suites,
MainStay Suites, Suburban Extended Stay Hotel, Econo Lodge, Rodeway Inn
and Ascend Collectionare proprietary trademarks and service
marks of Choice Hotels International.
© 2011 Choice Hotels International, Inc. All rights
reserved.
Choice
Hotels International, Inc.
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Exhibit
1
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Consolidated
Statements of Income
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(Unaudited)
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Three
Months Ended December 31,
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Year
Ended December 31,
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Variance
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Variance
|
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2010
|
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2009
|
|
$
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%
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|
2010
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|
2009
|
|
$
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%
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|
(In
thousands, except per share amounts)
|
|
|
|
|
|
|
|
|
|
|
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REVENUES:
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Royalty
fees
|
$
59,067
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|
$
53,213
|
|
$ 5,854
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|
11%
|
|
$
230,096
|
|
$
217,984
|
|
$
12,112
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|
6%
|
|
Initial
franchise and relicensing fees
|
2,758
|
|
3,317
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|
(559)
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|
(17%)
|
|
9,295
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|
12,916
|
|
(3,621)
|
|
(28%)
|
|
Procurement
services
|
3,595
|
|
3,514
|
|
81
|
|
2%
|
|
17,207
|
|
17,598
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|
(391)
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|
(2%)
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|
Marketing
and reservation
|
87,150
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|
77,576
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|
9,574
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|
12%
|
|
329,246
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|
305,379
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|
23,867
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|
8%
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|
Hotel
operations
|
987
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|
909
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|
78
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9%
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|
4,031
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|
4,140
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|
(109)
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|
(3%)
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Other
|
|
1,449
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|
2,172
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(723)
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(33%)
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|
6,201
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|
6,161
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|
40
|
|
1%
|
|
Total
revenues
|
155,006
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|
140,701
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|
14,305
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10%
|
|
596,076
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|
564,178
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|
31,898
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6%
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|
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|
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OPERATING
EXPENSES:
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Selling,
general and administrative
|
26,744
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|
26,183
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|
561
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2%
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|
94,540
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|
99,237
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|
(4,697)
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(5%)
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Depreciation
and amortization
|
1,872
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|
2,084
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|
(212)
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(10%)
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|
8,342
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|
8,336
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|
6
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0%
|
|
Marketing
and reservation
|
87,150
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|
77,576
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|
9,574
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12%
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|
329,246
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|
305,379
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|
23,867
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|
8%
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Hotel
operations
|
799
|
|
775
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|
24
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|
3%
|
|
3,186
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|
3,153
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|
33
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|
1%
|
|
Total
operating expenses
|
116,565
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|
106,618
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|
9,947
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9%
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|
435,314
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|
416,105
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|
19,209
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|
5%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
income
|
38,441
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|
34,083
|
|
4,358
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|
13%
|
|
160,762
|
|
148,073
|
|
12,689
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|
9%
|
|
|
|
|
|
|
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|
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|
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|
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OTHER
INCOME AND EXPENSES:
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Interest
expense
|
3,520
|
|
683
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|
2,837
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|
415%
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|
6,680
|
|
4,414
|
|
2,266
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|
51%
|
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Interest
and other investment income
|
(1,258)
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|
(560)
|
|
(698)
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|
125%
|
|
(2,903)
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|
(5,862)
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|
2,959
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(50%)
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Equity
in net income of affiliates
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(336)
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|
(334)
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|
(2)
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|
1%
|
|
(1,226)
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|
(1,113)
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|
(113)
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|
10%
|
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Total
other income and expenses, net
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1,926
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|
(211)
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|
2,137
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(1013%)
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|
2,551
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(2,561)
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|
5,112
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(200%)
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|
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Income
before income taxes
|
36,515
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|
34,294
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|
2,221
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|
6%
|
|
158,211
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|
150,634
|
|
7,577
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|
5%
|
|
Income
taxes
|
12,372
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|
10,663
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|
1,709
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|
16%
|
|
50,770
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|
52,384
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|
(1,614)
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|
(3%)
|
|
Net
income
|
$
24,143
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|
$
23,631
|
|
$ 512
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|
2%
|
|
$
107,441
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|
$
98,250
|
|
$ 9,191
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|
9%
|
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|
Basic
earnings per share
|
$ 0.41
|
|
$ 0.40
|
|
$ 0.01
|
|
2%
|
|
$ 1.80
|
|
$ 1.64
|
|
$ 0.16
|
|
10%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted
earnings per share
|
$ 0.40
|
|
$ 0.40
|
|
$ -
|
|
0%
|
|
$ 1.80
|
|
$ 1.63
|
|
$ 0.17
|
|
10%
|
|
|
|
|
|
|
|
|
|
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|
|
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|
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Choice
Hotels International, Inc.
|
|
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Exhibit
2
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Consolidated
Balance Sheets
|
|
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|
|
|
|
|
|
|
|
|
|
|
|
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|
|
(In
thousands, except per share amounts)
|
|
December
31,
|
|
December
31,
|
|
|
|
|
|
2010
|
|
2009
|
|
|
|
|
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
ASSETS
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash
and cash equivalents
|
|
$
91,259
|
|
$
67,870
|
|
Accounts
receivable, net
|
|
47,638
|
|
41,898
|
|
Deferred
income taxes
|
|
429
|
|
7,980
|
|
Other
current assets
|
|
24,256
|
|
10,114
|
|
|
Total
current assets
|
|
163,582
|
|
127,862
|
|
|
|
|
|
|
|
|
|
Fixed
assets and intangibles, net
|
|
142,528
|
|
133,999
|
|
Receivable
-- marketing and reservation fees
|
|
42,507
|
|
33,872
|
|
Investments,
employee benefit plans, at fair value
|
|
23,365
|
|
20,931
|
|
Other
assets
|
|
39,740
|
|
23,373
|
|
|
|
|
|
|
|
|
|
|
|
Total
assets
|
|
$
411,722
|
|
$
340,037
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
LIABILITIES
AND SHAREHOLDERS' DEFICIT
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Accounts
payable and accrued expenses
|
|
$
88,986
|
|
$
70,933
|
|
Deferred
revenue
|
|
67,322
|
|
51,765
|
|
Revolving
credit facility
|
|
200
|
|
-
|
|
Deferred
compensation & retirement plan obligations
|
|
2,552
|
|
2,798
|
|
Current
portion of long-term debt
|
|
420
|
|
-
|
|
Income
taxes payable
|
|
5,778
|
|
6,310
|
|
|
Total
current liabilities
|
|
165,258
|
|
131,806
|
|
|
|
|
|
|
|
|
|
Long-term
debt
|
|
251,554
|
|
277,700
|
|
Deferred
compensation & retirement plan obligations
|
|
35,707
|
|
34,956
|
|
Other
liabilities
|
|
17,274
|
|
9,787
|
|
|
|
|
|
|
|
|
|
|
Total
liabilities
|
|
469,793
|
|
454,249
|
|
|
|
|
|
|
|
|
|
Common
stock, $0.01 par value
|
|
596
|
|
595
|
|
Additional
paid-in-capital
|
|
92,774
|
|
90,731
|
|
Accumulated
other comprehensive income (loss)
|
|
(7,192)
|
|
333
|
|
Treasury
stock, at cost
|
|
(872,306)
|
|
(870,302)
|
|
Retained
earnings
|
|
728,057
|
|
664,431
|
|
|
Total
shareholders' deficit
|
|
(58,071)
|
|
(114,212)
|
|
|
|
|
|
|
|
|
|
|
|
Total
liabilities and shareholders' deficit
|
|
$
411,722
|
|
$
340,037
|
|
|
|
|
|
|
|
|
Choice
Hotels International, Inc.
|
|
|
Exhibit
3
|
|
Consolidated
Statements of Cash Flows
|
|
|
|
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(In
thousands)
|
Year
Ended December 31,
|
|
|
|
|
|
|
|
2010
|
|
2009
|
|
CASH
FLOWS FROM OPERATING ACTIVITIES:
|
|
|
|
|
|
|
|
|
|
Net
income
|
$
107,441
|
|
$
98,250
|
|
|
|
|
|
|
Adjustments
to reconcile net income to net cash provided
|
|
|
|
|
by
operating activities:
|
|
|
|
|
Depreciation
and amortization
|
8,342
|
|
8,336
|
|
Provision
for bad debts
|
3,547
|
|
2,578
|
|
Non-cash
stock compensation and other charges
|
9,304
|
|
13,761
|
|
Non-cash
interest and other income
|
(1,711)
|
|
(5,403)
|
|
Dividends
received from equity method investments
|
1,155
|
|
1,337
|
|
Equity
in net income of affiliates
|
(1,226)
|
|
(1,113)
|
|
|
|
|
|
|
Changes
in assets and liabilities:
|
|
|
|
|
Receivables
|
(9,229)
|
|
(796)
|
|
Receivable
- marketing and reservation fees, net
|
4,654
|
|
(12,232)
|
|
Accounts
payable
|
5,744
|
|
(8,279)
|
|
Accrued
expenses
|
10,630
|
|
(1,289)
|
|
Income
taxes payable/receivable
|
(1,417)
|
|
8,163
|
|
Deferred
income taxes
|
(2,381)
|
|
5,553
|
|
Deferred
revenue
|
15,413
|
|
4,650
|
|
Other
assets
|
(12,705)
|
|
3,041
|
|
Other
liabilities
|
7,374
|
|
(4,341)
|
|
|
|
|
|
|
NET
CASH PROVIDED BY OPERATING ACTIVITIES
|
144,935
|
|
112,216
|
|
|
|
|
|
|
CASH
FLOWS FROM INVESTING ACTIVITIES:
|
|
|
|
|
|
|
|
|
|
Investment
in property and equipment
|
(24,368)
|
|
(11,135)
|
|
Acquisitions,
net of cash required
|
(466)
|
|
-
|
|
Issuance
of notes receivable
|
(11,786)
|
|
(1,995)
|
|
Collections
of notes receivable
|
5,083
|
|
324
|
|
Purchases
of investments, employee benefit plans
|
(1,948)
|
|
(3,854)
|
|
Proceeds
from sales of investments, employee benefit plans
|
1,649
|
|
13,895
|
|
Other
items, net
|
(319)
|
|
(584)
|
|
|
|
|
|
|
NET
CASH USED IN INVESTING ACTIVITIES
|
(32,155)
|
|
(3,349)
|
|
|
|
|
|
|
CASH
FLOWS FROM FINANCING ACTIVITIES:
|
|
|
|
|
|
|
|
|
|
Proceeds
from the issuance of long-term debt
|
247,733
|
|
-
|
|
Net
repayments pursuant to revolving credit facility
|
(277,500)
|
|
(6,700)
|
|
Principal
payments on long-term debt
|
(25)
|
|
-
|
|
Settlement
of forward starting interest rate swap agreement
|
(8,663)
|
|
-
|
|
Debt
issuance costs
|
(800)
|
|
-
|
|
Purchase
of treasury stock
|
(11,212)
|
|
(59,128)
|
|
Excess
tax benefits from stock-based compensation
|
625
|
|
5,834
|
|
Dividends
paid
|
(43,808)
|
|
(44,274)
|
|
Proceeds
from exercise of stock options
|
2,457
|
|
9,158
|
|
|
|
|
|
|
NET
CASH USED IN FINANCING ACTIVITIES
|
(91,193)
|
|
(95,110)
|
|
|
|
|
|
|
Net
change in cash and cash equivalents
|
21,587
|
|
13,757
|
|
Effect
of foreign exchange rate changes on cash and cash equivalents
|
1,802
|
|
1,433
|
|
Cash
and cash equivalents at beginning of period
|
67,870
|
|
52,680
|
|
|
|
|
|
|
CASH
AND CASH EQUIVALENTS AT END OF PERIOD
|
$
91,259
|
|
$
67,870
|
|
|
|
|
|
CHOICE
HOTELS INTERNATIONAL, INC.
|
Exhibit
4
|
|
SUPPLEMENTAL
OPERATING INFORMATION
|
|
|
DOMESTIC
HOTEL SYSTEM
|
|
|
(UNAUDITED)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For
the Year Ended December 31, 2010*
|
|
For
the Year Ended December 31, 2009*
|
|
Change
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Average
Daily
|
|
|
|
|
|
Average
Daily
|
|
|
|
|
|
Average
Daily
|
|
|
|
|
|
|
|
|
|
Rate
|
|
Occupancy
|
|
RevPAR
|
|
Rate
|
|
Occupancy
|
|
RevPAR
|
|
Rate
|
|
Occupancy
|
|
RevPAR
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Comfort
Inn
|
|
$ 77.21
|
|
55.6%
|
|
$ 42.93
|
|
$ 77.10
|
|
54.1%
|
|
$ 41.74
|
|
0.1%
|
|
150
|
bps
|
|
2.9%
|
|
|
Comfort
Suites
|
|
82.48
|
|
55.2%
|
|
45.53
|
|
84.79
|
|
53.3%
|
|
45.17
|
|
(2.7%)
|
|
190
|
bps
|
|
0.8%
|
|
|
Sleep
|
|
68.82
|
|
51.6%
|
|
35.52
|
|
69.64
|
|
51.5%
|
|
35.86
|
|
(1.2%)
|
|
10
|
bps
|
|
(0.9%)
|
|
|
Midscale
without Food & Beverage
|
|
77.37
|
|
54.9%
|
|
42.47
|
|
77.89
|
|
53.5%
|
|
41.69
|
|
(0.7%)
|
|
140
|
bps
|
|
1.9%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Quality
|
|
66.81
|
|
48.1%
|
|
32.11
|
|
68.00
|
|
46.0%
|
|
31.31
|
|
(1.8%)
|
|
210
|
bps
|
|
2.6%
|
|
|
Clarion
|
|
75.15
|
|
43.7%
|
|
32.86
|
|
77.79
|
|
42.2%
|
|
32.86
|
|
(3.4%)
|
|
150
|
bps
|
|
0.0%
|
|
|
Midscale
with Food & Beverage
|
|
68.53
|
|
47.1%
|
|
32.28
|
|
69.92
|
|
45.2%
|
|
31.63
|
|
(2.0%)
|
|
190
|
bps
|
|
2.1%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Econo
Lodge
|
|
54.10
|
|
45.8%
|
|
24.80
|
|
54.66
|
|
43.5%
|
|
23.78
|
|
(1.0%)
|
|
230
|
bps
|
|
4.3%
|
|
|
Rodeway
|
|
51.07
|
|
45.8%
|
|
23.38
|
|
52.48
|
|
43.0%
|
|
22.54
|
|
(2.7%)
|
|
280
|
bps
|
|
3.7%
|
|
|
Economy
|
|
53.17
|
|
45.8%
|
|
24.36
|
|
54.02
|
|
43.3%
|
|
23.41
|
|
(1.6%)
|
|
250
|
bps
|
|
4.1%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
MainStay
|
|
65.60
|
|
63.6%
|
|
41.71
|
|
70.55
|
|
57.9%
|
|
40.82
|
|
(7.0%)
|
|
570
|
bps
|
|
2.2%
|
|
|
Suburban
|
|
39.23
|
|
63.8%
|
|
25.03
|
|
41.51
|
|
56.3%
|
|
23.35
|
|
(5.5%)
|
|
750
|
bps
|
|
7.2%
|
|
|
Extended
Stay
|
|
46.65
|
|
63.7%
|
|
29.74
|
|
49.81
|
|
56.7%
|
|
28.24
|
|
(6.3%)
|
|
700
|
bps
|
|
5.3%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Ascend
Collection
|
|
112.50
|
|
57.6%
|
|
$ 64.81
|
|
115.97
|
|
49.4%
|
|
$ 57.24
|
|
(3.0%)
|
|
820
|
bps
|
|
13.2%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
|
|
$ 70.50
|
|
51.3%
|
|
$ 36.18
|
|
$ 71.24
|
|
49.4%
|
|
$ 35.18
|
|
(1.0%)
|
|
190
|
bps
|
|
2.8%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
*
Operating statistics represent hotel operations from December through
November
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For
the Three Months Ended December 31, 2010*
|
|
For
the Three Months Ended December 31, 2009*
|
|
Change
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Average
Daily
|
|
|
|
|
|
Average
Daily
|
|
|
|
|
|
Average
Daily
|
|
|
|
|
|
|
|
|
Rate
|
|
Occupancy
|
|
RevPAR
|
|
Rate
|
|
Occupancy
|
|
RevPAR
|
|
Rate
|
|
Occupancy
|
|
RevPAR
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Comfort
Inn
|
|
$ 77.36
|
|
56.3%
|
|
$ 43.54
|
|
$ 75.92
|
|
52.5%
|
|
$ 39.86
|
|
1.9%
|
|
380
|
bps
|
|
9.2%
|
|
Comfort
Suites
|
|
81.17
|
|
55.4%
|
|
44.96
|
|
81.94
|
|
50.5%
|
|
41.40
|
|
(0.9%)
|
|
490
|
bps
|
|
8.6%
|
|
Sleep
|
|
68.47
|
|
51.2%
|
|
35.04
|
|
68.03
|
|
48.7%
|
|
33.12
|
|
0.6%
|
|
250
|
bps
|
|
5.8%
|
|
Midscale
without Food & Beverage
|
|
77.09
|
|
55.3%
|
|
42.61
|
|
76.27
|
|
51.4%
|
|
39.23
|
|
1.1%
|
|
390
|
bps
|
|
8.6%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Quality
|
|
65.35
|
|
48.2%
|
|
31.52
|
|
65.71
|
|
43.7%
|
|
28.68
|
|
(0.5%)
|
|
450
|
bps
|
|
9.9%
|
|
Clarion
|
|
74.05
|
|
44.9%
|
|
33.23
|
|
77.29
|
|
39.9%
|
|
30.84
|
|
(4.2%)
|
|
500
|
bps
|
|
7.7%
|
|
Midscale
with Food & Beverage
|
|
67.21
|
|
47.5%
|
|
31.91
|
|
67.98
|
|
42.9%
|
|
29.14
|
|
(1.1%)
|
|
460
|
bps
|
|
9.5%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Econo
Lodge
|
|
53.59
|
|
46.2%
|
|
24.77
|
|
53.67
|
|
42.1%
|
|
22.62
|
|
(0.1%)
|
|
410
|
bps
|
|
9.5%
|
|
Rodeway
|
|
50.00
|
|
45.2%
|
|
22.60
|
|
50.11
|
|
40.4%
|
|
20.24
|
|
(0.2%)
|
|
480
|
bps
|
|
11.7%
|
|
Economy
|
|
52.50
|
|
45.9%
|
|
24.10
|
|
52.62
|
|
41.6%
|
|
21.89
|
|
(0.2%)
|
|
430
|
bps
|
|
10.1%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
MainStay
|
|
64.30
|
|
63.1%
|
|
40.56
|
|
67.07
|
|
57.2%
|
|
38.33
|
|
(4.1%)
|
|
590
|
bps
|
|
5.8%
|
|
Suburban
|
|
39.20
|
|
62.5%
|
|
24.50
|
|
38.91
|
|
57.1%
|
|
22.21
|
|
0.7%
|
|
540
|
bps
|
|
10.3%
|
|
Extended
Stay
|
|
46.32
|
|
62.7%
|
|
29.03
|
|
46.92
|
|
57.1%
|
|
26.79
|
|
(1.3%)
|
|
560
|
bps
|
|
8.4%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Ascend
Collection
|
|
127.73
|
|
60.4%
|
|
$ 77.12
|
|
122.14
|
|
51.2%
|
|
$ 62.58
|
|
4.6%
|
|
920
|
bps
|
|
23.2%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
|
|
$ 70.09
|
|
51.6%
|
|
$ 36.19
|
|
$ 69.65
|
|
47.4%
|
|
$ 32.99
|
|
0.6%
|
|
420
|
bps
|
|
9.7%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
*
Operating statistics represent hotel operations from September through
November
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For
the Quarter Ended
|
|
|
|
For
the Year Ended
|
|
|
|
12/31/2010
|
|
12/31/2009
|
|
|
|
12/31/2010
|
|
12/31/2009
|
|
|
|
|
|
|
|
|
|
|
|
|
|
System-wide
effective royalty rate
|
|
4.31%
|
|
4.28%
|
|
|
|
4.29%
|
|
4.25%
|
|
|
|
|
|
|
|
|
|
|
|
|
CHOICE
HOTELS INTERNATIONAL, INC.
|
Exhibit
5
|
|
SUPPLEMENTAL
HOTEL AND ROOM SUPPLY DATA
|
|
|
(UNAUDITED)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
December
31, 2010
|
|
December
31, 2009
|
|
Variance
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Hotels
|
|
Rooms
|
|
Hotels
|
|
Rooms
|
|
Hotels
|
|
Rooms
|
|
%
|
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Comfort
Inn
|
|
1,435
|
|
112,169
|
|
1,447
|
|
113,633
|
|
(12)
|
|
(1,464)
|
|
(0.8%)
|
|
(1.3%)
|
|
|
Comfort
Suites
|
|
623
|
|
48,246
|
|
608
|
|
47,301
|
|
15
|
|
945
|
|
2.5%
|
|
2.0%
|
|
|
Sleep
|
|
398
|
|
28,957
|
|
392
|
|
28,599
|
|
6
|
|
358
|
|
1.5%
|
|
1.3%
|
|
|
Midscale
without Food & Beverage
|
|
2,456
|
|
189,372
|
|
2,447
|
|
189,533
|
|
9
|
|
(161)
|
|
0.4%
|
|
(0.1%)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Quality
|
|
1,012
|
|
89,185
|
|
979
|
|
89,336
|
|
33
|
|
(151)
|
|
3.4%
|
|
(0.2%)
|
|
|
Clarion
|
|
192
|
|
28,711
|
|
172
|
|
24,636
|
|
20
|
|
4,075
|
|
11.6%
|
|
16.5%
|
|
|
Midscale
with Food & Beverage
|
|
1,204
|
|
117,896
|
|
1,151
|
|
113,972
|
|
53
|
|
3,924
|
|
4.6%
|
|
3.4%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Econo
Lodge
|
|
784
|
|
48,728
|
|
792
|
|
48,996
|
|
(8)
|
|
(268)
|
|
(1.0%)
|
|
(0.5%)
|
|
|
Rodeway
|
|
387
|
|
21,261
|
|
372
|
|
21,392
|
|
15
|
|
(131)
|
|
4.0%
|
|
(0.6%)
|
|
|
Economy
|
|
1,171
|
|
69,989
|
|
1,164
|
|
70,388
|
|
7
|
|
(399)
|
|
0.6%
|
|
(0.6%)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
MainStay
|
|
37
|
|
2,868
|
|
37
|
|
2,866
|
|
-
|
|
2
|
|
0.0%
|
|
0.1%
|
|
|
Suburban
|
|
64
|
|
7,685
|
|
61
|
|
7,416
|
|
3
|
|
269
|
|
4.9%
|
|
3.6%
|
|
|
Extended
Stay
|
|
101
|
|
10,553
|
|
98
|
|
10,282
|
|
3
|
|
271
|
|
3.1%
|
|
2.6%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Ascend
Collection
|
|
38
|
|
3,025
|
|
28
|
|
2,346
|
|
10
|
|
679
|
|
35.7%
|
|
28.9%
|
|
|
Cambria
Suites
|
|
23
|
|
2,700
|
|
18
|
|
2,073
|
|
5
|
|
627
|
|
27.8%
|
|
30.2%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Domestic
Franchises
|
|
4,993
|
|
393,535
|
|
4,906
|
|
388,594
|
|
87
|
|
4,941
|
|
1.8%
|
|
1.3%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
International
Franchises
|
|
1,149
|
|
101,610
|
|
1,115
|
|
98,816
|
|
34
|
|
2,794
|
|
3.0%
|
|
2.8%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
Franchises
|
|
6,142
|
|
495,145
|
|
6,021
|
|
487,410
|
|
121
|
|
7,735
|
|
2.0%
|
|
1.6%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Exhibit
6
|
|
CHOICE
HOTELS INTERNATIONAL, INC.
|
|
SUPPLEMENTAL
INFORMATION BY BRAND
|
|
DEVELOPMENT
RESULTS -- DOMESTIC NEW HOTEL CONTRACTS
|
|
(UNAUDITED)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For
the Year Ended December 31, 2010
|
|
For
the Year Ended December 31, 2009
|
|
%
Change
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
New
|
|
|
|
|
|
New
|
|
|
|
|
|
New
|
|
|
|
|
|
|
|
Construction
|
|
Conversion
|
|
Total
|
|
Construction
|
|
Conversion
|
|
Total
|
|
Construction
|
|
Conversion
|
|
Total
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Comfort
Inn
|
|
7
|
|
32
|
|
39
|
|
9
|
|
39
|
|
48
|
|
(22%)
|
|
(18%)
|
|
(19%)
|
|
Comfort
Suites
|
|
21
|
|
2
|
|
23
|
|
16
|
|
1
|
|
17
|
|
31%
|
|
100%
|
|
35%
|
|
Sleep
|
|
9
|
|
1
|
|
10
|
|
12
|
|
2
|
|
14
|
|
(25%)
|
|
(50%)
|
|
(29%)
|
|
Midscale
without Food & Beverage
|
|
37
|
|
35
|
|
72
|
|
37
|
|
42
|
|
79
|
|
0%
|
|
(17%)
|
|
(9%)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Quality
|
|
1
|
|
104
|
|
105
|
|
4
|
|
111
|
|
115
|
|
(75%)
|
|
(6%)
|
|
(9%)
|
|
Clarion
|
|
-
|
|
37
|
|
37
|
|
1
|
|
31
|
|
32
|
|
(100%)
|
|
19%
|
|
16%
|
|
Midscale
with Food & Beverage
|
|
1
|
|
141
|
|
142
|
|
5
|
|
142
|
|
147
|
|
(80%)
|
|
(1%)
|
|
(3%)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Econo
Lodge
|
|
-
|
|
67
|
|
67
|
|
-
|
|
68
|
|
68
|
|
NM
|
|
(1%)
|
|
(1%)
|
|
Rodeway
|
|
1
|
|
39
|
|
40
|
|
1
|
|
48
|
|
49
|
|
0%
|
|
(19%)
|
|
(18%)
|
|
Economy
|
|
1
|
|
106
|
|
107
|
|
1
|
|
116
|
|
117
|
|
0%
|
|
(9%)
|
|
(9%)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
MainStay
|
|
8
|
|
2
|
|
10
|
|
5
|
|
2
|
|
7
|
|
60%
|
|
0%
|
|
43%
|
|
Suburban
|
|
5
|
|
1
|
|
6
|
|
3
|
|
2
|
|
5
|
|
67%
|
|
(50%)
|
|
20%
|
|
Extended
Stay
|
|
13
|
|
3
|
|
16
|
|
8
|
|
4
|
|
12
|
|
63%
|
|
(25%)
|
|
33%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Ascend
Collection
|
|
1
|
|
13
|
|
14
|
|
3
|
|
9
|
|
12
|
|
(67%)
|
|
44%
|
|
17%
|
|
Cambria
Suites
|
|
6
|
|
-
|
|
6
|
|
2
|
|
-
|
|
2
|
|
200%
|
|
NM
|
|
200%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
Domestic System
|
|
59
|
|
298
|
|
357
|
|
56
|
|
313
|
|
369
|
|
5%
|
|
(5%)
|
|
(3%)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For
the Three Months Ended December 31, 2010
|
|
For
the Three Months Ended December 31, 2009
|
|
%
Change
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
New
|
|
|
|
|
|
New
|
|
|
|
|
|
New
|
|
|
|
|
|
|
|
Construction
|
|
Conversion
|
|
Total
|
|
Construction
|
|
Conversion
|
|
Total
|
|
Construction
|
|
Conversion
|
|
Total
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Comfort
Inn
|
|
3
|
|
10
|
|
13
|
|
5
|
|
17
|
|
22
|
|
(40%)
|
|
(41%)
|
|
(41%)
|
|
Comfort
Suites
|
|
8
|
|
1
|
|
9
|
|
7
|
|
-
|
|
7
|
|
14%
|
|
NM
|
|
29%
|
|
Sleep
|
|
6
|
|
1
|
|
7
|
|
1
|
|
-
|
|
1
|
|
500%
|
|
NM
|
|
600%
|
|
Midscale
without Food & Beverage
|
|
17
|
|
12
|
|
29
|
|
13
|
|
17
|
|
30
|
|
31%
|
|
(29%)
|
|
(3%)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Quality
|
|
-
|
|
50
|
|
50
|
|
1
|
|
24
|
|
25
|
|
(100%)
|
|
108%
|
|
100%
|
|
Clarion
|
|
-
|
|
20
|
|
20
|
|
-
|
|
8
|
|
8
|
|
NM
|
|
150%
|
|
150%
|
|
Midscale
with Food & Beverage
|
|
-
|
|
70
|
|
70
|
|
1
|
|
32
|
|
33
|
|
(100%)
|
|
119%
|
|
112%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Econo
Lodge
|
|
-
|
|
29
|
|
29
|
|
-
|
|
23
|
|
23
|
|
NM
|
|
26%
|
|
26%
|
|
Rodeway
|
|
-
|
|
13
|
|
13
|
|
-
|
|
12
|
|
12
|
|
NM
|
|
8%
|
|
8%
|
|
Economy
|
|
-
|
|
42
|
|
42
|
|
-
|
|
35
|
|
35
|
|
NM
|
|
20%
|
|
20%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
MainStay
|
|
4
|
|
2
|
|
6
|
|
4
|
|
1
|
|
5
|
|
0%
|
|
100%
|
|
20%
|
|
Suburban
|
|
4
|
|
1
|
|
5
|
|
1
|
|
2
|
|
3
|
|
300%
|
|
(50%)
|
|
67%
|
|
Extended
Stay
|
|
8
|
|
3
|
|
11
|
|
5
|
|
3
|
|
8
|
|
60%
|
|
0%
|
|
38%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Ascend
Collection
|
|
-
|
|
8
|
|
8
|
|
2
|
|
4
|
|
6
|
|
(100%)
|
|
100%
|
|
33%
|
|
Cambria
Suites
|
|
1
|
|
-
|
|
1
|
|
-
|
|
-
|
|
-
|
|
NM
|
|
NM
|
|
NM
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
Domestic System
|
|
26
|
|
135
|
|
161
|
|
21
|
|
91
|
|
112
|
|
24%
|
|
48%
|
|
44%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
`
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Exhibit
7
|
|
CHOICE
HOTELS INTERNATIONAL, INC.
|
|
DOMESTIC
HOTEL PIPELINE OF HOTELS UNDER CONSTRUCTION, AWAITING
CONVERSION
OR APPROVED FOR DEVELOPMENT
|
|
(UNAUDITED)
|
|
|
|
A
hotel in the domestic pipeline does not always result in an open and
operating hotel due to various factors.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Variance
|
|
|
|
December
31, 2010
|
|
December
31, 2009
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Units
|
|
Units
|
|
Conversion
|
|
New
Construction
|
|
Total
|
|
|
|
Conversion
|
|
New
Construction
|
|
Total
|
|
Conversion
|
|
New
Construction
|
|
Total
|
|
Units
|
|
%
|
|
Units
|
|
%
|
|
Units
|
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Comfort
Inn
|
|
30
|
|
62
|
|
92
|
|
43
|
|
91
|
|
134
|
|
(13)
|
|
(30%)
|
|
(29)
|
|
(32%)
|
|
(42)
|
|
(31%)
|
|
Comfort
Suites
|
|
1
|
|
122
|
|
123
|
|
-
|
|
181
|
|
181
|
|
1
|
|
NM
|
|
(59)
|
|
(33%)
|
|
(58)
|
|
(32%)
|
|
Sleep
Inn
|
|
-
|
|
75
|
|
75
|
|
1
|
|
122
|
|
123
|
|
(1)
|
|
(100%)
|
|
(47)
|
|
(39%)
|
|
(48)
|
|
(39%)
|
|
Midscale
without Food & Beverage
|
|
31
|
|
259
|
|
290
|
|
44
|
|
394
|
|
438
|
|
(13)
|
|
(30%)
|
|
(135)
|
|
(34%)
|
|
(148)
|
|
(34%)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Quality
|
|
33
|
|
8
|
|
41
|
|
48
|
|
15
|
|
63
|
|
(15)
|
|
(31%)
|
|
(7)
|
|
(47%)
|
|
(22)
|
|
(35%)
|
|
Clarion
|
|
18
|
|
2
|
|
20
|
|
19
|
|
6
|
|
25
|
|
(1)
|
|
(5%)
|
|
(4)
|
|
(67%)
|
|
(5)
|
|
(20%)
|
|
Midscale
with Food & Beverage
|
|
51
|
|
10
|
|
61
|
|
67
|
|
21
|
|
88
|
|
(16)
|
|
(24%)
|
|
(11)
|
|
(52%)
|
|
(27)
|
|
(31%)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Econo
Lodge
|
|
35
|
|
2
|
|
37
|
|
43
|
|
4
|
|
47
|
|
(8)
|
|
(19%)
|
|
(2)
|
|
(50%)
|
|
(10)
|
|
(21%)
|
|
Rodeway
|
|
12
|
|
2
|
|
14
|
|
36
|
|
2
|
|
38
|
|
(24)
|
|
(67%)
|
|
-
|
|
0%
|
|
(24)
|
|
(63%)
|
|
Economy
|
|
47
|
|
4
|
|
51
|
|
79
|
|
6
|
|
85
|
|
(32)
|
|
(41%)
|
|
(2)
|
|
(33%)
|
|
(34)
|
|
(40%)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
MainStay
|
|
1
|
|
42
|
|
43
|
|
-
|
|
37
|
|
37
|
|
1
|
|
NM
|
|
5
|
|
14%
|
|
6
|
|
16%
|
|
Suburban
|
|
-
|
|
27
|
|
27
|
|
2
|
|
30
|
|
32
|
|
(2)
|
|
(100%)
|
|
(3)
|
|
(10%)
|
|
(5)
|
|
(16%)
|
|
Extended
Stay
|
|
1
|
|
69
|
|
70
|
|
2
|
|
67
|
|
69
|
|
(1)
|
|
(50%)
|
|
2
|
|
3%
|
|
1
|
|
1%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Ascend
Collection
|
|
6
|
|
4
|
|
10
|
|
2
|
|
4
|
|
6
|
|
4
|
|
200%
|
|
-
|
|
0%
|
|
4
|
|
67%
|
|
Cambria
Suites
|
|
-
|
|
34
|
|
34
|
|
-
|
|
41
|
|
41
|
|
-
|
|
NM
|
|
(7)
|
|
(17%)
|
|
(7)
|
|
(17%)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
136
|
|
380
|
|
516
|
|
194
|
|
533
|
|
727
|
|
(58)
|
|
(30%)
|
|
(153)
|
|
(29%)
|
|
(211)
|
|
(29%)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Exhibit
8
|
|
|
CHOICE
HOTELS INTERNATIONAL, INC.
|
|
|
SUPPLEMENTAL
NON-GAAP FINANCIAL INFORMATION
|
|
|
(UNAUDITED)
|
|
|
|
|
|
|
|
|
|
|
|
|
CALCULATION
OF FRANCHISING REVENUES AND ADJUSTED FRANCHISING MARGINS
|
|
|
|
|
|
|
|
|
|
|
|
|
(dollar
amounts in thousands)
|
|
Three
Months Ended December 31,
|
|
Year
Ended December 31,
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2010
|
|
2009
|
|
2010
|
|
2009
|
|
|
Franchising
Revenues:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
Revenues
|
|
$
155,006
|
|
$
140,701
|
|
$
596,076
|
|
$
564,178
|
|
|
Adjustments:
|
|
|
|
|
|
|
|
|
|
|
Marketing
and reservation revenues
|
|
(87,150)
|
|
(77,576)
|
|
(329,246)
|
|
(305,379)
|
|
|
Hotel
operations
|
|
(987)
|
|
(909)
|
|
(4,031)
|
|
(4,140)
|
|
|
Franchising
Revenues
|
|
$
66,869
|
|
$
62,216
|
|
$
262,799
|
|
$
254,659
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Franchising
Margins:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
Margin:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
Revenues
|
|
$
155,006
|
|
$
140,701
|
|
$
596,076
|
|
$
564,178
|
|
|
Operating
Income
|
|
$
38,441
|
|
$
34,083
|
|
$
160,762
|
|
$
148,073
|
|
|
Operating
Margin
|
|
24.8%
|
|
24.2%
|
|
27.0%
|
|
26.2%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted
Franchising Margin:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Franchising
Revenues
|
|
$
66,869
|
|
$
62,216
|
|
$
262,799
|
|
$
254,659
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
Income
|
|
$
38,441
|
|
$
34,083
|
|
$
160,762
|
|
$
148,073
|
|
|
Employee
termination benefits
|
|
1,233
|
|
2,334
|
|
1,730
|
|
4,604
|
|
|
Curtailment
loss related to the freezing of benefits under the Company's
Supplemental Executive Retirement Plan
|
|
-
|
|
1,209
|
|
-
|
|
1,209
|
|
|
Loss
on sublease of office space
|
|
-
|
|
-
|
|
-
|
|
1,503
|
|
|
Hotel
operations
|
|
(188)
|
|
(134)
|
|
(845)
|
|
(987)
|
|
|
|
|
$
39,486
|
|
$
37,492
|
|
$
161,647
|
|
$
154,402
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted
Franchising Margins
|
|
59.0%
|
|
60.3%
|
|
61.5%
|
|
60.6%
|
|
|
|
|
|
|
|
|
|
|
|
|
CALCULATION
OF ADJUSTED SELLING, GENERAL AND ADMINISTRATIVE COSTS
|
|
|
|
|
|
|
|
|
|
|
|
|
(dollar
amounts in thousands)
|
|
Three
Months Ended December 31,
|
|
Year
Ended December 31,
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2010
|
|
2009
|
|
2010
|
|
2009
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Selling,
general and administrative expense
|
|
$
26,744
|
|
$
26,183
|
|
$
94,540
|
|
$
99,237
|
|
|
Employee
termination benefits
|
|
(1,233)
|
|
(2,334)
|
|
(1,730)
|
|
(4,604)
|
|
|
Curtailment
loss related to the freezing of benefits under the Company's
Supplemental Executive Retirement Plan
|
|
-
|
|
(1,209)
|
|
-
|
|
(1,209)
|
|
|
Loss
on sublease of office space
|
|
-
|
|
-
|
|
-
|
|
(1,503)
|
|
|
Adjusted
Selling, General and Administrative Expense
|
|
$
25,511
|
|
$
22,640
|
|
$
92,810
|
|
$
91,921
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CALCULATION
OF ADJUSTED NET INCOME AND ADJUSTED DILUTED EARNINGS PER SHARE (EPS)
|
|
|
|
|
|
|
|
|
|
|
|
|
(In
thousands, except per share amounts)
|
|
Three
Months Ended December 31,
|
|
Year
Ended December 31,
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2010
|
|
2009
|
|
2010
|
|
2009
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
Income
|
|
$
24,143
|
|
$
23,631
|
|
$
107,441
|
|
$
98,250
|
|
Adjustments:
|
|
|
|
|
|
|
|
|
|
|
Employee
termination benefits
|
|
772
|
|
1,461
|
|
1,083
|
|
2,882
|
|
|
Curtailment
loss related to the freezing of benefits under the Company's
Supplemental Executive Retirement Plan
|
|
-
|
|
757
|
|
-
|
|
757
|
|
|
Loss
on sublease of office space
|
|
-
|
|
-
|
|
-
|
|
941
|
|
Adjusted
Net Income
|
|
$
24,915
|
|
$
25,849
|
|
$
108,524
|
|
$
102,830
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted
average shares outstanding-diluted
|
|
59,706
|
|
59,658
|
|
59,656
|
|
60,224
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted
Earnings Per Share
|
|
$ 0.40
|
|
$ 0.40
|
|
$ 1.80
|
|
$ 1.63
|
|
Adjustments:
|
|
|
|
|
|
|
|
|
|
|
Employee
termination benefits
|
|
0.02
|
|
0.02
|
|
0.02
|
|
0.05
|
|
|
Curtailment
loss related to the freezing of benefits under the Company's
Supplemental Executive Retirement Plan
|
|
-
|
|
0.01
|
|
-
|
|
0.01
|
|
|
Loss
on sublease of office space
|
|
-
|
|
-
|
|
-
|
|
0.02
|
|
Adjusted
Diluted Earnings Per Share (EPS)
|
|
$ 0.42
|
|
$ 0.43
|
|
$ 1.82
|
|
$ 1.71
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted
EBITDA Reconciliation
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(in
millions)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Q4
2010 Actuals
|
|
Q4
2009 Actuals
|
|
Year
Ended December 31,
2010
Actuals
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Year
Ended December
31,
2009 Actuals
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Full-Year
2011
Outlook
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Operating
Income (per GAAP)
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$ 38.4
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$ 34.1
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$ 160.8
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$ 148.1
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$171-$174
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Employee
termination benefits
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1.2
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2.3
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1.7
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4.6
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-
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Curtailment
loss related to the freezing of benefits under the Company's
Supplemental Executive Retirement Plan
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-
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1.2
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-
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1.2
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-
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Loss
on sublease of office space
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-
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-
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-
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1.5
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-
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Depreciation
and amortization
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1.9
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2.1
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8.3
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8.3
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9.0
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Adjusted
Earnings before interest, taxes, depreciation & amortization
(non-GAAP)
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$ 41.5
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$ 39.7
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$ 170.8
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$ 163.7
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$180-$183
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