CHOICE HOTELS INTERNATIONAL INC / DE0001046311FALSE00010463112024-11-042024-11-04

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
  _____________________________________________________ 
FORM 8-K
 _____________________________________________________ 
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15 (d)
OF THE SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported): November 4, 2024
  _____________________________________________________ 
 CHOICE HOTELS INTERNATIONAL, INC.
(Exact name of registrant as specified in its charter)
 _____________________________________________________ 
Delaware001-1339352-1209792
(State or other jurisdiction
of incorporation)		(Commission
File Number)		(IRS Employer
Identification Number)
915 Meeting Street20852
Suite 600
North Bethesda,Maryland
(Address of principal executive offices)(Zip Code)
Registrant’s telephone number, including area code (301) 592-5000
  _____________________________________________________  
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below): 
☐Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
☐Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
☐Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
☐Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
Securities registered pursuant to Section 12(b) of the Act:
Title of Each ClassTicker Symbol(s)Name of Each Exchange on Which Registered
Common Stock, Par Value $0.01 per shareCHHNew York Stock Exchange
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐


Item 2.02.Results of Operations and Financial Condition.
On November 4, 2024, Choice Hotels International, Inc. issued a press release announcing earnings for the quarter ended September 30, 2024. A copy of the release is furnished herewith as Exhibit 99.1.

Item 9.01.Financial Statements and Exhibits.
(d) Exhibits
Exhibit 104—Cover Page Interactive Data File (embedded within the Inline XBRL document)


SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
 
Date:November 4, 2024/s/ Scott E. Oaksmith
Scott E. Oaksmith
Chief Financial Officer




choicea.jpg
CHOICE HOTELS INTERNATIONAL REPORTS STRONG THIRD QUARTER 2024 RESULTS

Drives EPS Growth of 23% Year-over-Year
Raises Full-year 2024 Net Income, EPS, and RevPAR Guidance

NORTH BETHESDA, Md., November 4, 2024 – Choice Hotels International, Inc. (NYSE: CHH), one of the world’s leading lodging franchisors, today reported its third quarter 2024 results.

Highlights include:
•Total revenues reached $428.0 million for third quarter 2024, a quarterly record and a 1% increase compared to the same period of 2023.

•Net income increased 15% to $105.7 million for third quarter 2024, representing diluted earnings per share (EPS) of $2.22, a quarterly record and a 23% increase compared to the same period of 2023.

•Third quarter 2024 adjusted net income, excluding certain items described in Exhibit 7, increased 15% to $106.2 million compared to the same period of 2023, and adjusted diluted EPS increased 23% to a record of $2.23 compared to the same period of 2023.

•Adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) for third quarter 2024 grew to a quarterly record of $177.6 million, a 14% increase compared to the same period of 2023.

•Global pipeline as of September 30, 2024, increased 11% to a third quarter record of over 110,000 rooms from September 30, 2023, highlighted by a 54% increase for conversion rooms. Domestic rooms pipeline as of September 30, 2024, increased by 10% since September 30, 2023, including a 68% increase for conversion rooms.

•Global hotel openings for third quarter 2024 increased by 75% compared to the same period of 2023.

•The company’s unit and room growth as of September 30, 2024, accelerated across its domestic and international portfolio from June 30, 2024. The company’s upscale, extended stay, and midscale rooms portfolio, as of September 30, 2024, increased by 1.8% globally since September 30, 2023.

•The international portfolio as of September 30, 2024, expanded by 3.8% in the number of rooms, highlighted by international hotel openings that tripled in third quarter 2024 compared to the same period of 2023.



•The company repurchased 2.9 million shares of common stock for $352.9 million year-to-date through September 30, 2024, representing over 6% of the company’s market capitalization at the beginning of the year.

•The company is increasing midpoint of its guidance for net income, adjusted EBITDA, diluted EPS, and adjusted diluted EPS for full-year 2024.

“Choice Hotels generated another quarter of record financial performance, demonstrating the successful execution of our growth strategy and giving us the confidence to raise our full-year guidance,” said Patrick Pacious, President and Chief Executive Officer. “We accelerated our unit growth, increased our global pipeline to new levels, expanded our international reach, and significantly grew the size of our rewards program. The positive momentum we have created and the strength of our versatile business model bolsters our ability to continue to deliver sustained top-line and earnings growth while returning significant capital to shareholders.”

Financial Performance
•Total revenues excluding reimbursable revenue from franchised and managed properties, calculated as total revenues net of reimbursable revenue of $171.8 million, increased 17% to $256.1 million for the third quarter 2024 compared to the same period of 2023.

•Platform and procurement services fees increased 4% to $16.2 million for third quarter 2024 compared to the same period of 2023.

•Third quarter 2024 domestic effective royalty rate increased 6 basis points to 5.05% compared to the same period of 2023.

•Domestic revenue per available room (RevPAR) decreased 250 basis points for the three-month period ended September 30, 2024, compared to the same period of 2023. Domestic occupancy levels for the three-month period ended September 30, 2024, improved by 80 basis points from the three months ended June 30, 2024.

Development
•The company’s total domestic system size increased to nearly 6,300 hotels representing over 495,000 rooms as of September 30, 2024. The company’s domestic upscale, extended stay, and midscale portfolio increased 1.3% for hotels and increased 1.1% for rooms since September 30, 2023. The domestic extended stay hotels portfolio grew by 11.2% since September 30, 2023, driven by increases in each of the company’s brands.

•The company’s international rooms pipeline as of September 30, 2024 increased by 21% compared to the same period of 2023.

•The company opened 190 domestic hotel openings year-to-date through September 30, 2024, a 19% increase compared to the same period of 2023. Of the domestic franchise agreements executed for conversion hotels over the trailing twelve months ending September 30, 2024, 141 opened in the same year, a 17% increase over the comparable period of the prior year.



Balance Sheet and Liquidity
As of September 30, 2024, the company had a total available liquidity of $675.6 million, including available borrowing capacity and cash and equivalents. During the three and nine months ended September 30, 2024, the company generated cash flows from operating activities of $122.9 million and $236.5 million, respectively.

Shareholder Returns
During the nine months ended September 30, 2024, the company paid cash dividends totaling $42.5 million.

During the nine months ended September 30, 2024, the company repurchased 2.9 million shares of common stock for $352.9 million under its stock repurchase program and through repurchases from employees in connection with tax withholding and option exercises relating to awards under the company’s equity incentive plans.

As of September 30, 2024, the company had 4.0 million shares of common stock remaining under the current share repurchase authorization.

Outlook
The outlook information below includes forward-looking non-GAAP financial measures, which management uses in forecasting performance. The adjusted numbers in the company’s outlook below exclude the net surplus or deficit generated from reimbursable revenue from franchised and managed properties, due diligence and transition costs, additional repurchases of company stock, and other items:

Full-Year 2024Prior Outlook
Net Income$276 – $284 million$260 – $272 million
Adjusted Net Income$323 – $331 million$309.5 – $321.5 million
Adjusted EBITDA$590 – $600 million$580 – $600 million
Diluted EPS$5.74 – $5.91$5.40 – $5.65
Adjusted Diluted EPS$6.70 – $6.87$6.40 – $6.65
Effective Income Tax Rate24.0%24.5%
Full-Year 2024Prior Outlook
vs. Full-Year 2023
Domestic RevPAR Growth-2% to -1%-3.5% to -1.5%
Domestic Effective Royalty Rate GrowthMid-single digitsMid-single digits
Domestic Net Unit GrowthApproximately 2%Approximately 2%
(upscale, extended stay, and midscale brands)

Webcast and Conference Call
Choice Hotels International will conduct a live webcast to discuss the company’s third quarter 2024 earnings results on November 4, 2024, at 10:00 a.m. on the company’s investor relations website, www.investor.choicehotels.com, accessible via the Events and Presentations tab.



A conference call will also be available. Participants may listen to the call by dialing (800) 549-8228 domestically or (646) 564-2877 internationally using conference ID 91747.

A replay and transcript of the event will be available on the company’s investor relations website within 24 hours at www.investor.choicehotels.com/events-and-presentations.

About Choice Hotels®
Choice Hotels International, Inc. (NYSE: CHH) is one of the largest lodging franchisors in the world, with over 7,500 hotels, representing nearly 635,000 rooms, in 45 countries and territories as of September 30, 2024. A diverse portfolio of 22 brands that range from full-service upper upscale properties to midscale, extended stay, and economy enables Choice® to meet travelers’ needs in more places and for more occasions while driving more value for franchise owners and shareholders. The award-winning Choice Privileges® rewards program and co-brand credit card options provide members with a fast and easy way to earn reward nights and personalized perks. For more information, visit www.choicehotels.com.

Forward-Looking Statements
Information set forth herein includes “forward-looking statements.” Certain, but not necessarily all, of such forward-looking statements can be identified by the use of forward-looking terminology, such as “expect,” “estimate,” “believe,” “anticipate,” “should,” “will,” “forecast,” “plan,” “project,” “assume,” or similar words of futurity. All statements other than historical facts are forward-looking statements. These forward-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 projections of Choice’s revenue, expenses, EBITDA, adjusted EBITDA, earnings, debt levels, ability to repay outstanding indebtedness, payment of dividends, repurchases of common stock and other financial and operational measures, including occupancy and open hotels, RevPAR, and Choice’s liquidity, 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, including access to liquidity and capital; changes in consumer demand and confidence, including consumer discretionary spending and the demand for travel, transient and group business; the timing and amount of future dividends and share repurchases; future domestic or global outbreaks of epidemics, pandemics or contagious diseases or fear of such outbreaks, and the related impact on the global hospitality industry, particularly but not exclusively the U.S. travel market; changes in law and regulation applicable to the travel, lodging or franchising industries, including with respect to the status of the company’s relationship with employees of our franchisees; foreign currency fluctuations; impairments or declines in the value of the company’s assets; operating risks common in the travel, lodging or 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 and our relationships with our franchisees; our ability to keep pace with improvements in technology utilized for marketing and reservations systems and other operating systems; our ability to grow our franchise system; exposure to risks related to our hotel development, financing and ownership activities; exposures to risks associated with our investments in new businesses; fluctuations in the supply and demand for hotel rooms; our ability to realize anticipated benefits from acquired businesses; impairments or losses relating to acquired businesses; the level of acceptance of alternative growth strategies we may implement; the impact of inflation; cyber security and data breach risks; climate change and sustainability related concerns; ownership and financing activities; hotel closures or financial difficulties of our franchisees; operating risks associated with our international operations; labor shortages; the outcome of litigation; and our ability to effectively manage our indebtedness and secure our indebtedness. These and other risk factors are discussed in detail in the company’s filings with the U.S. Securities and Exchange Commission, including our Annual Report on Form 10-K. We undertake no obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future events or otherwise, except as required by law.

Non-GAAP Financial Measurements and Other Definitions
The company evaluates its operations utilizing the performance metrics of EBITDA, adjusted EBITDA, adjusted net income, and adjusted EPS, which are all non-GAAP financial measurements. These measures, which are reconciled to the comparable GAAP measures in Exhibits 6 and 7, should not be considered as an alternative to any measure of performance or liquidity as promulgated under or authorized by GAAP, such as net income and EPS. The company’s calculation of these measurements may be different from the calculations used by other companies and comparability may therefore be limited. We discuss management’s reasons for reporting these non-GAAP measures and how each non-GAAP measure is calculated below.

In addition to the specific adjustments noted below with respect to each measure, the adjusted EBITDA, adjusted net income and adjusted EPS presented herein also exclude restructuring of the company’s operations including employee severance benefit, income taxes and legal costs, acquisition related to business combination, due diligence and, transition costs, expenses associated with legal claims, loss on the sale of equity securities, net of dividend income purchased in contemplation of the proposed acquisition of Wyndham Hotels, global ERP system implementation and related costs, performance under limited debt payment guaranties and gain on sale of a hotel owned through an unconsolidated joint venture to allow for period-over-period comparison of ongoing core operations before the impact of these discrete and infrequent charges.



Earnings Before Interest, Taxes, Depreciation, and Amortization and Adjusted Earnings Before Interest, Taxes, Depreciation, and Amortization: EBITDA reflects net income excluding the impact of interest expense, interest income, provision for income taxes, depreciation and amortization, impairments and gains on sale of business and assets, other (gains) and losses, equity in net income (loss) of unconsolidated affiliates and gain on extinguishment of debt. Adjusted EBITDA, presented herein, is calculated as EBITDA, as previously defined, further adjusted to exclude certain items, including, mark-to-market adjustments on non-qualified retirement plan investments, share based compensation expense (benefit) and surplus or deficits generated by reimbursable revenue from franchised and managed properties. We consider EBITDA and adjusted EBITDA to be an indicator of operating performance because it measures our ability to service debt, fund capital expenditures, and expand our business. We also use these measures, as do analysts, lenders, investors, and others, to evaluate companies because it excludes certain items that can vary widely across industries or among companies within the same industry. For example, interest expense can be dependent on a company’s capital structure, debt levels, and credit ratings, and share based compensation expense (benefit) is dependent on the design of compensation plans in place and the usage of them. Accordingly, the impact of interest expense and share based compensation expense (benefit) on earnings can vary significantly among companies. The tax positions of companies can also vary because of their differing abilities to take advantage of tax benefits and because of the tax policies of the jurisdictions in which they operate. As a result, effective tax rates and provision for income taxes can vary considerably among companies. These measures also exclude depreciation and amortization because companies utilize productive assets of different ages and use different methods of both acquiring and depreciating productive assets or amortizing franchise-agreement acquisition costs. These differences can result in considerable variability in the relative asset costs and estimated lives and, therefore, the depreciation and amortization expense among companies. Mark-to-market adjustments on non-qualified retirement-plan investments recorded in selling, general and administrative (SG&A) expenses are excluded from adjusted EBITDA, as the company accounts for these investments in accordance with accounting for deferred-compensation arrangements when investments are held in a rabbi trust and invested. Changes in the fair value of the investments are recognized as both compensation expense in SG&A and other gains and losses. As a result, the changes in the fair value of the investments do not have a material impact on the company’s net income. Surpluses and deficits generated from reimbursable revenues from franchised and managed properties are excluded, as the company’s franchise and management agreements require these revenues to be used exclusively for expenses associated with providing franchise and management services, such as central reservation systems, hotel employee and operating costs, reservation delivery and national marketing and media advertising. Franchised and managed property owners are required to reimburse the company for any deficits generated from these activities and the company is required to spend any surpluses generated in future periods. Since these activities will be managed to break-even over time, quarterly or annual surpluses and deficits have been excluded from the measurements utilized to assess the company’s operating performance.



Adjusted Net Income and Adjusted Earnings Per Share: Adjusted net income and EPS exclude the impact of surpluses or deficits generated from reimbursable revenue from franchised and managed properties and gains on extinguishment of debt. Surpluses and deficits generated from reimbursable revenue from franchised and managed properties are excluded, as the company’s franchise agreements require these revenues to be used exclusively for expenses associated with providing franchised and managed services, such as central reservation systems, hotel employee and operating costs, reservation delivery and national marketing and media advertising. Franchised and managed property owners are required to reimburse the company for any deficits generated from activities and the company is required to spend any surpluses generated in future periods. Since these activities will be managed to break-even over time, quarterly or annual surpluses and deficits have been excluded from the measurements utilized to assess the company’s operating performance. We consider adjusted net income and adjusted EPS to be indicators of operating performance because excluding these items allows for period-over-period comparisons of our ongoing operations.

Occupancy: Occupancy represents the total number of room nights sold divided by the total number of room nights available at a hotel for a given period. Occupancy measures the utilization of the hotels’ available capacity. Management uses occupancy to gauge demand at a specific hotel or group of hotels in a given period. The company calculates occupancy based on information as reported by its franchisees. To accurately reflect occupancy, the company may revise its prior years’ operating statistics for the most current information provided.

Average Daily Rate (ADR): ADR represents hotel room revenue divided by the total number of room nights sold for a given period. ADR measures the average room price attained by a hotel and ADR trends provide useful information concerning the pricing environment and the nature of the customer base of a hotel or group of hotels. ADR is a commonly used performance measure in the industry, and management uses ADR to assess pricing levels that the company is able to generate. The company calculates ADR based on information as reported by its franchisees. To accurately reflect ADR, the company may revise its prior years’ operating statistics for the most current information provided.

RevPAR: RevPAR is calculated by dividing hotel room revenue by the total number of room nights available to guests for a given period. Management considers RevPAR to be a meaningful indicator of hotel performance and therefore company royalty and system revenues as it provides a metric correlated to the two key drivers of operations at a hotel: occupancy and ADR. The company calculates RevPAR based on information as reported by its franchisees. To accurately reflect RevPAR, the company may revise its prior years’ operating statistics for the most current information provided. RevPAR is also a useful indicator in measuring performance over comparable periods.

Pipeline: Pipeline is defined as hotels awaiting conversion, under construction or approved for development, and master development agreements committing owners to future franchise development.

Contacts
Allie Summers, Senior Director, Investor Relations
IR@choicehotels.com

© 2024 Choice Hotels International, Inc. All rights reserved.


Choice Hotels International, Inc.Exhibit 1
Condensed Consolidated Statements of Income
(Unaudited)
(In thousands, except per share amounts)Three months ended September 30,Nine months ended September 30,
VarianceVariance
20242023$%20242023$%
REVENUES
Royalty, licensing and management fees$147,151 $148,512 $(1,361)(1)%$394,431 $396,503 $(2,072)(1)%
Initial franchise fees5,866 6,194 (328)(5)%19,133 21,240 (2,107)(10)%
Platform and procurement services fees16,178 15,542 636 4 %58,060 58,186 (126)— %
Owned hotels31,936 26,239 5,697 22 %85,345 74,075 11,270 15 %
Other13,857 11,436 2,421 21 %45,251 33,211 12,040 36 %
Other revenues from franchised and managed properties212,976 217,634 (4,658)(2)%592,849 602,554 (9,705)(2)%
Total revenues427,964 425,557 2,407 1 %1,195,069 1,185,769 9,300 1 %
OPERATING EXPENSES
Selling, general and administrative49,077 44,042 5,035 11 %162,697 151,387 11,310 7 %
Business combination, diligence and transition costs984 10,871 (9,887)(91)%17,723 30,613 (12,890)(42)%
Depreciation and amortization10,861 9,633 1,228 13 %32,623 29,468 3,155 11 %
Owned hotels22,343 18,628 3,715 20 %62,370 53,924 8,446 16 %
Other expenses from franchised and managed properties192,916 207,341 (14,425)(7)%575,102 583,095 (7,993)(1)%
Total operating expenses276,181 290,515 (14,334)(5)%850,515 848,487 2,028 — %
Operating income151,783 135,042 16,741 12 %344,554 337,282 7,272 2 %
OTHER EXPENSES AND INCOME, NET
Interest expense22,038 16,168 5,870 36 %66,064 46,522 19,542 42 %
Interest income(2,411)(1,897)(514)27 %(6,557)(5,836)(721)12 %
Loss on extinguishment of debt331 — 331 NM331 — 331 NM
Other (gain) loss (4,013)1,343 (5,356)(399)%(133)(2,752)2,619 (95)%
Equity in net gain of affiliates(1,310)(1,801)491 (27)%(9,088)(1,923)(7,165)373 %
Total other expenses and income, net14,635 13,813 822 6 %50,617 36,011 14,606 41 %
Income before income taxes137,148 121,229 15,919 13 %293,937 301,271 (7,334)(2)%
Income tax expense31,432 29,205 2,227 8 %70,076 71,717 (1,641)(2)%
Net income$105,716 $92,024 $13,692 15 %$223,861 $229,554 $(5,693)(2)%
Basic earnings per share$2.24 $1.83 $0.41 22 %$4.64 $4.51 $0.13 3 %
Diluted earnings per share$2.22 $1.81 $0.41 23 %$4.61 $4.47 $0.14 3 %



Choice Hotels International, Inc.Exhibit 2
Condensed Consolidated Balance Sheets
(Unaudited)
(In thousands)September 30,December 31,
20242023
ASSETS
Cash and cash equivalents$58,565 $26,754 
Accounts receivable, net210,925 195,896 
Other current assets69,112 73,880 
Total current assets338,602 296,530 
Property and equipment, net580,021 493,478 
Operating lease right-of-use assets81,987 85,101 
Goodwill220,187 220,187 
Intangible assets, net863,811 811,075 
Notes receivable, net of allowances99,722 78,900 
Investments in equity securities, at fair value— 116,374 
Investments for employee benefit plans, at fair value47,788 39,751 
Investments in affiliates109,732 70,579 
Other assets202,196 182,824 
Total assets$2,544,046 $2,394,799 
LIABILITIES AND SHAREHOLDERS' (DEFICIT) EQUITY
Accounts payable$152,781 $131,284 
Accrued expenses and other current liabilities122,172 109,248 
Deferred revenue103,194 108,316 
Current portion of long-term debt— 499,268 
Liability for guest loyalty program100,639 94,574 
 Total current liabilities478,786 942,690 
Long-term debt1,810,731 1,068,751 
Long-term deferred revenue132,332 133,501 
Deferred compensation & retirement plan obligations53,361 45,657 
Operating lease liabilities109,930 109,483 
Liability for guest loyalty program46,797 43,266 
Other liabilities8,261 15,853 
Total liabilities2,640,198 2,359,201 
Total shareholders' (deficit) equity(96,152)35,598 
Total liabilities and shareholders' (deficit) equity$2,544,046 $2,394,799 



Choice Hotels International, Inc.Exhibit 3
Condensed Consolidated Statements of Cash Flows
(Unaudited)
(In thousands)Nine months ended September 30,
20242023
CASH FLOWS FROM OPERATING ACTIVITIES
Net income$223,861 $229,554 
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization32,623 29,468 
Depreciation and amortization – other expenses from franchised and managed properties20,236 27,544 
Franchise agreement acquisition cost amortization20,584 14,616 
Non-cash share-based compensation and other charges32,445 34,670 
Non-cash interest, investments, and affiliate income, net(7,529)(1,709)
Deferred income taxes(21,086)(4,315)
Equity in net loss (gain) of affiliates, less distributions received56 (621)
Franchise agreement acquisition costs, net of reimbursements(84,085)(72,867)
Change in working capital and other19,435 (9,150)
Net cash provided by operating activities236,540 247,190 
CASH FLOWS FROM INVESTING ACTIVITIES
Investments in other property and equipment(33,620)(35,933)
Investments in owned hotel properties(81,239)(45,470)
Contributions to investments in affiliates(47,695)(24,573)
Issuances of notes receivable(24,405)(4,319)
Distributions from sales of affiliates15,850 868 
Collections of notes receivable2,277 9,923 
Proceeds from sales of equity securities108,149 — 
Other items, net(2,680)(3,761)
Net cash used in investing activities(63,363)(103,265)
CASH FLOWS FROM FINANCING ACTIVITIES
Net borrowings pursuant to revolving credit facilities154,500 191,500 
Proceeds from the issuance of long-term debt593,574 — 
Repayment of long-term debt(500,000)— 
Debt issuance costs(8,069)(755)
Purchases of treasury stock(348,964)(304,400)
Dividends paid(42,488)(42,073)
Proceeds from the exercise of stock options9,279 6,719 
Net cash used in financing activities(142,168)(149,009)
Net change in cash and cash equivalents31,009 (5,084)
Effect of foreign exchange rate changes on cash and cash equivalents802 (50)
Cash and cash equivalents, beginning of period26,754 41,566 
Cash and cash equivalents, end of period$58,565 $36,432 


Exhibit 4
CHOICE HOTELS INTERNATIONAL, INC.
SUPPLEMENTAL OPERATING INFORMATION
DOMESTIC HOTEL SYSTEM
(UNAUDITED)
For the three months ended September 30, 2024For the three months ended September 30, 2023Change
Average DailyAverage DailyAverage Daily
RateOccupancyRevPARRateOccupancyRevPARRateOccupancyRevPAR
Upscale & Above (1)
$159.88 64.2 %$102.69 $160.49 63.0 %$101.17 (0.4)%120bps1.5 %
Midscale & Upper Midscale (2)
106.57 61.0 %65.04 107.75 62.2 %67.04 (1.1)%(120)bps(3.0)%
Extended Stay (3)
65.45 73.3 %47.99 64.65 74.5 %48.17 1.2 %(120)bps(0.4)%
Economy (4)
75.69 50.5 %38.20 76.97 51.6 %39.73 (1.7)%(110)bps(3.8)%
Total$102.10 61.1 %$62.41 $103.31 61.9 %$63.99 (1.2)%(80)bps(2.5)%
For the nine months ended September 30, 2024For the nine months ended September 30, 2023Change
Average DailyAverage DailyAverage Daily
RateOccupancyRevPARRateOccupancyRevPARRateOccupancyRevPAR
Upscale & Above (1)
$153.87 59.1 %$91.01 $152.59 58.2 %$88.82 0.8 %90bps2.5 %
Midscale & Upper Midscale (2)
101.86 57.0 %58.04 102.90 58.3 %60.00 (1.0)%(130)bps(3.3)%
Extended Stay (3)
63.84 72.1 %46.04 64.28 73.5 %47.24 (0.7)%(140)bps(2.5)%
Economy (4)
71.83 47.6 %34.20 72.65 49.0 %35.57 (1.1)%(140)bps(3.8)%
Total$97.45 57.4 %$55.93 $98.59 58.3 %$57.50 (1.2)%(90)bps(2.7)%
Effective Royalty Rate
For the three months endedFor the nine months ended
September 30, 2024September 30, 2023September 30, 2024September 30, 2023
System-wide5.05 %4.99 %5.05 %4.99 %
(1) Includes Ascend Hotel Collection, Cambria, Park Plaza, Radisson, Radisson Blu, Radisson Individuals, and Radisson RED brands.
(2) Includes Clarion, Comfort Inn, Country Inn, Park Inn, Quality Inn, Radisson Inn, and Sleep Inn brands.
(3) Includes Everhome Suites, Mainstay Suites, Suburban Studios, and WoodSpring Suites brands.
(4) Includes Econo Lodge and Rodeway brands.


Exhibit 5
CHOICE HOTELS INTERNATIONAL, INC.
SUPPLEMENTAL HOTEL AND ROOM SUPPLY DATA
(UNAUDITED)
September 30, 2024September 30, 2023Variance
HotelsRoomsHotelsRoomsHotels%Rooms%
Ascend Hotel Collection201 22,957 208 23,187 (7)(3.4)%(230)(1.0)%
Cambria Hotels75 10,226 69 9,398 68.7 %8288.8 %
Radisson(1)
61 14,296 66 15,499 (5)(7.6)%(1,203)(7.8)%
Comfort(2)
1,669 131,205 1,667 131,027 20.1 %1780.1 %
Quality1,623 118,361 1,614 119,067 90.6 %(706)(0.6)%
Country418 33,327 427 33,996 (9)(2.1)%(669)(2.0)%
Sleep421 29,610 430 30,331 (9)(2.1)%(721)(2.4)%
Clarion(3)
188 19,763 182 19,763 63.3 %—— %
Park Inn25 2,818 4 363 21525.0 %2,455676.3 %
WoodSpring249 29,989 231 27,862 187.8 %2,1277.6 %
MainStay132 9,459 124 8,503 86.5 %95611.2 %
Suburban110 9,178 91 7,954 1920.9 %1,22415.4 %
Everhome6 685 1 98 5500.0 %587599.0 %
Econo Lodge650 37,955 671 39,429 (21)(3.1)%(1,474)(3.7)%
Rodeway450 25,365 471 26,557 (21)(4.5)%(1,192)(4.5)%
Domestic Franchises6,278 495,194 6,256 493,034 220.4 %2,1600.4 %
International Franchises1,237 139,758 1,207 134,660 302.5 %5,0983.8 %
Total Franchises7,515 634,952 7,463 627,694 520.7 %7,2581.2 %
(1) Includes Radisson, Radisson Blu, Radisson Individuals, and Radisson Red brands.
(2) Includes Comfort family of brand extensions including Comfort Inn and Comfort Suites.
(3) Includes Clarion family of brand extensions including Clarion and Clarion Pointe.




Exhibit 6
CHOICE HOTELS INTERNATIONAL, INC.
SUPPLEMENTAL NON-GAAP FINANCIAL INFORMATION
(UNAUDITED)
EARNINGS BEFORE INTEREST, TAXES, DEPRECIATION AND AMORTIZATION ("EBITDA") AND ADJUSTED EBITDA
(dollar amounts in thousands)Three months ended September 30,Nine months ended September 30,
2024202320242023
Net income $105,716 $92,024 $223,861 $229,554 
Income tax expense31,432 29,205 70,076 71,717 
Interest expense22,038 16,168 66,064 46,522 
Interest income(2,411)(1,897)(6,557)(5,836)
Loss on extinguishment of debt331 — 331 — 
Other (gain) loss(4,013)1,343 (133)(2,752)
Equity in net gain of affiliates(1,310)(1,801)(9,088)(1,923)
Depreciation and amortization10,861 9,633 32,623 29,468 
EBITDA$162,644 $144,675 $377,177 $366,750 
Share-based compensation5,425 5,890 15,484 16,503 
Mark to market adjustments on non-qualified retirement plan investments2,533 (913)7,185 2,955 
Franchise agreement acquisition costs amortization and charges4,011 2,972 11,592 8,368 
Net reimbursable deficit (surplus) from franchised and managed properties1,148 (7,889)30,703 (13,150)
Global ERP system implementation and related costs586 — 586 — 
Business combination, diligence and transition costs984 10,871 17,723 30,613 
Operational restructuring charges255 275 788 1,844 
Limited payment guarantee charge— — — 1,551 
Expenses associated with legal claims— — 2,430 — 
Adjusted EBITDA$177,586 $155,881 $463,668 $415,434 
ADJUSTED NET INCOME AND ADJUSTED DILUTED EARNINGS PER SHARE (EPS)
(dollar amounts in thousands, except per share amounts)Three months ended September 30,Nine months ended September 30,
2024202320242023
Net income $105,716 $92,024 $223,861 $229,554 
Loss on extinguishment of debt250 — 250 — 
(Gain) Loss on investments in equity securities, net of dividend income(635)— 5,076 — 
Net reimbursable (surplus) deficit from franchised and managed properties(538)(7,975)18,660 (15,525)
Business combination, diligence and transition costs794 8,169 13,398 23,113 
Operational restructuring charges194 204 596 1,392 
Limited payment guarantee charge— — — 1,174 
Expenses associated with legal claims— — 1,830 — 
Gain on sale of an affiliate— — (5,446)— 
Global ERP system implementation and related costs443 — 443 — 
Adjusted Net Income$106,224 $92,422 $258,668 $239,708 
Diluted Earnings Per Share$2.22$1.81$4.61$4.47
Loss on extinguishment of debt0.01—0.01—
(Gain) Loss on investments in equity securities, net of dividend income(0.01)—0.10—
Net reimbursable (surplus) deficit from franchised and managed properties(0.02)(0.15)0.37(0.30)
Business combination, diligence and transition costs0.020.160.280.45
Operational restructuring charges——0.010.03
Limited payment guarantee charge———0.02
Expenses associated with legal claims——0.04—
Gain on sale of an affiliate——(0.11)—
Global ERP system implementation and related costs0.01—0.01—
Adjusted Diluted Earnings Per Share (EPS)$2.23$1.82$5.32$4.67


Exhibit 7
CHOICE HOTELS INTERNATIONAL, INC.
SUPPLEMENTAL INFORMATION - 2024 OUTLOOK
(UNAUDITED)
Guidance represents the company's range of estimated outcomes for the full year ended December 31, 2024
EBITDA AND ADJUSTED EBITDA
(in thousands)Full YearFull Year
Lower RangeUpper Range
Net income $276,000 $284,000 
Income tax expense86,700 88,500 
Interest expense88,000 88,000 
Interest income(8,400)(8,400)
Loss on extinguishment of debt300 300 
Other gain(500)(500)
Equity in net gain of affiliates(10,000)(9,800)
Depreciation and amortization51,900 51,900 
EBITDA$484,000 $494,000 
Share-based compensation20,800 20,800 
Mark to market adjustments on non-qualified retirement plan investments7,100 7,100 
Franchise agreement acquisition costs amortization15,200 15,400 
Net reimbursable deficit from franchised and managed properties39,600 39,600 
Global ERP system implementation and related costs1,700 1,700 
Business combination, diligence and transition costs18,300 18,100 
Operational restructuring charges800 800 
Expenses associated with legal claims2,500 2,500 
Adjusted EBITDA$590,000 $600,000 
ADJUSTED NET INCOME & DILUTED EARNINGS PER SHARE (EPS)
(in thousands, except per share amounts)Full YearFull Year
Lower RangeUpper Range
Net income$276,000 $284,000 
Loss on extinguishment of debt200 200 
Loss on investments in equity securities, net of dividend income5,100 5,100 
Net reimbursable deficit from franchised and managed properties29,800 29,800 
Business combination, diligence and transition costs13,600 13,600 
Operational restructuring charges600 600 
Expenses associated with legal claims1,800 1,800 
Gain on sale of an affiliate(5,300)(5,300)
Global ERP system implementation and related costs1,200 1,200 
Adjusted Net Income$323,000 $331,000 
Diluted Earnings Per Share$5.74 $5.91 
Loss on extinguishment of debt0.010.01
Loss on investments in equity securities, net of dividend income0.110.11
Net reimbursable deficit from franchised and managed properties0.610.61
Business combination, diligence and transition costs0.280.28
Operational restructuring charges0.010.01
Expenses associated with legal claims0.040.04
Gain on sale of an affiliate(0.11)(0.11)
Global ERP system implementation and related costs0.010.01
Adjusted Diluted Earnings Per Share (EPS)$6.70 $6.87 

v3.24.3
Document and Entity Information Document
Nov. 04, 2024
Cover [Abstract]  
Document Type 8-K
Document Period End Date Nov. 04, 2024
Entity File Number 001-13393
Entity Incorporation, State or Country Code DE
Entity Tax Identification Number 52-1209792
Entity Address, Address Line One 915 Meeting Street
Entity Address, Address Line Two Suite 600
Entity Address, City or Town North Bethesda,
Entity Address, State or Province MD
Entity Address, Postal Zip Code 20852
City Area Code 301
Local Phone Number 592-5000
Written Communications false
Soliciting Material false
Pre-commencement Tender Offer false
Pre-commencement Issuer Tender Offer false
Entity Emerging Growth Company false
Title of 12(b) Security Common Stock, Par Value $0.01 per share
Trading Symbol CHH
Security Exchange Name NYSE
Entity Registrant Name CHOICE HOTELS INTERNATIONAL INC / DE
Entity Central Index Key 0001046311
Amendment Flag false
Choice Hotels (NYSE:CHH)
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