ROCKVILLE, Md., Oct. 24, 2013 /PRNewswire/ -- Choice Hotels International, Inc., (NYSE: CHH) today reported the following highlights for the third quarter of 2013:
-- Franchising revenues increased 6% to $95.5 million for the three months
ending September 30, 2013 from $90.1 million for the same period in
2012. Total revenues increased 6% to $223.2 million for the three
months ending September 30, 2013 compared to the same period in 2012.
-- Operating income from franchising activities totaled $69.5 million for
the three months ending September 30, 2013, a 6% increase compared to
the same period in 2012. Total operating income increased 2% to $66.5
million for the three months ending September 30, 2013 compared to the
same period in 2012.
-- Domestic system-wide revenue per available room ("RevPAR") increased
3.0% for the three months ending September 30, 2013 compared to the same
period in 2012 as occupancy and average daily rates increased 70 basis
points and 1.9%, respectively.
-- Domestic unit and room growth increased 2.0% and 0.7% from September 30,
2012, respectively.
-- Domestic royalty fees for the three months ending September 30, 2013
increased 3% to $76.7 million from $74.3 million for the three months
ending September 30, 2012.
-- Initial and relicensing fees for the three months ending September 30,
2013 increased $1.4 million or 43% to $4.7 million from the same period
in 2012.
-- The company executed 129 new domestic hotel franchise contracts for the
three months ending September 30, 2013 compared to 89 new domestic hotel
franchise contracts for the same period in 2012, a 45% increase.
-- Domestic relicensing and contract renewal transactions increased from 62
contracts during the three months ending September 30, 2012 to 72 in the
current period, a 16% increase.
-- The number of worldwide hotels under construction, awaiting conversion
or approved for development as of September 30, 2013 was 455 hotels
representing 37,077 rooms, an increase of 4.6% and 2.6%, respectively,
from September 30, 2012.
-- Franchising SG&A expenses increased 6% from $22.5 million for the three
months ending September 30, 2012 to $23.8 million for the same period in
2012. Excluding variable expenses related to the company's non-qualified
retirement plan deferred compensation, franchising SG&A expense
increased 3.6% from $22.2 million in the prior year quarter to $23.0
million in the three months ending September 30, 2013. Selling, general
and administrative ("SG&A") expenses increased $3.8 million to $27.0
million for the three months ended September 30, 2013 compared to the
same period in 2012.
(Logo: http://photos.prnewswire.com/prnh/20131015/NE98133LOGO-l)
"Our franchising business continues to outperform our expectations. We are particularly pleased with recent activities on the development side of the business highlighted by a 45% increase in new domestic franchise contracts. The increase was driven by a 130% improvement in contracts for our flagship Comfort brands," said Stephen P. Joyce, president and chief executive officer, Choice Hotels International. "The Ascend Hotel Collection continues its rapid growth. This quarter we expanded in Europe and added another Ascend hotel in Australia. The Ascend Hotel Collection now has more than 115 worldwide locations, and we are excited about the future growth prospects of this brand as well as our family of brands."
Use of Free Cash Flow
The company has historically used its free cash flow (cash flow from operations less cash flow from investing activities) to return value to shareholders, primarily through share repurchases and dividends.
Dividends
The company's current quarterly dividend rate per common share is $0.185, subject to declaration by our board of directors. During the nine months ending September 30, 2013 and 2012, the company paid $22.0 million and $632.8 million in cash dividends to shareholders, respectively. The cash dividends paid during the nine months ending September 2013 reflect the company's decision to pay the first quarter of 2013 quarterly cash dividend in December 2012. In addition, cash dividends paid during the nine months ending September 30, 2012 include a special cash dividend in the amount of $10.41 per share or approximately $600.7 million paid on August 23, 2012.
As a result of the payment of the special cash dividend, earnings per share for the nine months ending September 30, 2013 include $15.5 million of additional interest expense compared to the prior year reflecting the financing transactions entered into during the second and third quarters of 2012.
Share Repurchases
The company did not repurchase any shares of common stock under the share repurchase program during the three and nine months ending September 30, 2013 but has authorization to purchase up to an additional 1.4 million shares under this program. We expect we will make repurchases from time to time under our share repurchase program in the open market and through privately negotiated transactions, subject to market and other conditions. There is no time limit on this authorization and no minimum number of share repurchases has been fixed. Since Choice announced its stock repurchase program on June 25, 1998 through September 30, 2013, the company has repurchased 45.3 million shares of its common stock for a total cost of $1.1 billion. Considering the effect of a two-for-one stock split in October 2005, the company has repurchased 78.3 million shares through September 30, 2013 under the share repurchase program at an average price of $13.89 per share.
Other
Our board of directors previously authorized us to enter into a program which permits 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 strategic markets. Over the next several years, we expect to continue to opportunistically deploy capital pursuant to this program to promote growth of our emerging brands. Our current expectation is that our annual investment in this program will range between $20 million and $40 million per year and we generally expect to recycle these investments over a 5 year period. However, the amount and timing of the investment in this program will be dependent on market and other conditions. Notwithstanding this program, 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.
Balance Sheet
As of September 30, 2013, the company had total debt (long-term plus current portion) of $825 million and cash and cash equivalents totaling $161 million resulting in net debt of $664 million. At December 31, 2012, the company had total debt of $855 million and cash equivalents totaling $134 million resulting in net debt of $721 million.
As of September 30, 2013 and December 31, 2012, the company had outstanding mezzanine financing, real estate investments and sliver equity investments totaling $71 million and $68 million, respectively, pursuant to its program to offer financing and investment support to incent franchise development for emerging brands in strategic markets. These investments are reported in other current assets and other assets on the company's consolidated balance sheet.
Outlook
The company's fourth quarter 2013 diluted EPS is expected to range between $0.44 and $0.46. The company expects full-year 2013 diluted EPS to range between $1.89 and $1.91. Earnings before interest, taxes, depreciation and amortization ("EBITDA") for full-year 2013 are expected to range between $203.5 million and $205.5 million. These estimates include the following assumptions:
-- The company expects net domestic unit growth to increase by
approximately 2% in 2013;
-- RevPAR is expected to increase approximately 2% and 3.25% for the fourth
quarter and full-year of 2013, respectively;
-- The effective royalty rate is expected to increase 1 basis point for
full-year 2013;
-- All figures assume the existing share count;
-- The effective tax rate is expected to be 29.0% and 28.5% for the fourth
quarter and full-year 2013, respectively; and
-- Our EBITDA outlook for the full year includes expenses related to the
company's SkyTouch Technology division ranging between $12 million and
$14 million for investment in the infrastructure of this division
including business development, sales and marketing and other costs as
well as continued software development expenditures related to the
division's technology related products and services.
Conference Call
Choice will conduct a conference call on Thursday, October 24, 2013 at 9:30 a.m. EDT to discuss the company's third quarter 2013 results. The dial-in number to listen to the call is 1-800-901-5213, and the access code is 73582897. International callers should dial 1-617-786-2962 and enter the access code 73582897. 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 1:30 p.m. EDT on Thursday October 24, 2013 through Thursday, October 31, 2013 by calling 1-888-286-8010 and entering access code 43130503. The international dial-in number for the replay is 1-617-801-6888, access code 43130503. In addition, the call will be archived for approximately one-year and available on www.choicehotels.com via the Investor Info link.
About Choice Hotels
Choice Hotels International, Inc. franchises more than 6,300 hotels, representing more than 500,000 rooms, in the United States and more than 30 other countries and territories. As of September 30, 2013, 371 hotels, representing more than 29,000 rooms, were under construction, awaiting conversion or approved for development in the United States. Additionally, 84 hotels, representing approximately 7,200 rooms, were under construction, awaiting conversion or approved for development in more than 15 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, as well as its Ascend Hotel Collection membership program, serve guests worldwide.
SkyTouch Technology is an initiative of Choice Hotels International, Inc. that develops and markets cloud-based technology products to help industry-wide hoteliers improve their efficiency and profitability.
Additional corporate information can 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 release constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Generally, our use of words such as "expect," "estimate," "believe," "anticipate," "will," "forecast," "plan"," project," "assume" or similar words of futurity identify such 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 the company's revenue, earnings and other financial and operational measures, company debt levels, ability to repay outstanding indebtedness, payment of 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; and our 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, 2012, filed with the Securities and Exchange Commission on February 28, 2013 and our quarterly reports filed on Form 10-Q. 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 Presented in this Press Release
EBITDA, franchising revenues, franchising SG&A, franchising margins and net debt are non-GAAP financial measurements. These measures should not be considered as an alternative to any measure of performance or liquidity as promulgated under or authorized by generally accepted accounting principles in the United States ("GAAP"), such as operating income, total revenues, operating margins and long-term debt. 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 EBITDA, franchising revenues, franchising SG&A and franchising margins to the most comparable GAAP financial measures. 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, loss on extinguishment of debt, interest income, provision for income taxes, depreciation and amortization, other (gains) and losses and equity in net income (loss) of unconsolidated affiliates. We consider EBITDA to be an indicator of operating performance because we use it to measure our ability to service debt, fund capital expenditures, and expand our business. We also use EBITDA, as do analysts, lenders, investors and others, to evaluate companies because it excludes certain items that can vary widely across different 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. Accordingly, the impact of interest expense 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. EBITDA also excludes depreciation and amortization because companies utilize productive assets of different ages and use different methods of both acquiring and depreciating productive assets. These differences can result in considerable variability in the relative costs of productive assets and the depreciation and amortization expense among companies.
Franchising Revenues, Operating Income, SG&A and Margins: The company reports franchising revenues, operating income, SG&A and margins which exclude marketing and reservation revenues, SkyTouch Technology and hotel operations. Marketing and reservation activities are excluded from franchising revenues and operating margins since the company is required by its franchise agreements to use these fees collected for marketing and reservation activities. Cumulative reservation and marketing system fees not expended are recorded as a liability on the company's financial statements and are carried over to the next year and expended in accordance with the franchise agreements. Cumulative marketing and reservation expenditures in excess of system 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 reflect the company's ownership of three MainStay Suites hotels. SkyTouch Technology is a division of the company that develops and markets cloud-based technology products to help industry-wide hoteliers improve their efficiency and profitability. Hotel and SkyTouch Technology operations are excluded from franchising revenue and margins since they do not reflect the company's core franchising business but are adjacent, complimentary lines of business. These non-GAAP measures are a commonly used measure of performance in our industry and facilitate comparisons between the company and its competitors.
Net Debt: Net debt is long-term debt plus the current portion of long-term debt (i.e., long-term debt due within one year) less cash and cash equivalents. The company believes that net debt is an important measurement as many investors use net debt in making investment decisions, as it gives them an idea of a company's financial health and its level of leverage compared to liquid assets. Some industries may have more net debt than others; therefore, investors often compare a company's net debt to others in the same business.
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, Ascend Hotel Collection and SkyTouch Technologyare proprietary trademarks and service marks of Choice Hotels International.
© 2013 Choice Hotels International, Inc. All rights reserved.
Choice Hotels International, Inc. Exhibit 1
Consolidated Statements of Income
(Unaudited)
Three Months Ended September 30, Nine Months Ended September 30,
-------------------------------- -------------------------------
Variance Variance
2013 2012 $ % 2013 2012 $ %
---- ---- --- --- ---- ---- --- ---
(In thousands, except per share amounts)
REVENUES:
Royalty fees $83,107 $80,845 $2,262 3% $201,222 $194,762 $6,460 3%
Initial franchise and relicensing fees 4,650 3,247 1,403 43% 12,843 8,953 3,890 43%
Procurement services 4,708 3,839 869 23% 16,204 13,990 2,214 16%
Marketing and reservation 126,296 119,062 7,234 6% 302,381 284,624 17,757 6%
Hotel operations 1,310 1,238 72 6% 3,600 3,440 160 5%
Other 3,091 2,182 909 42% 7,362 7,434 (72) (1%)
----- ----- --- --- ----- ----- --- ---
Total revenues 223,162 210,413 12,749 6% 543,612 513,203 30,409 6%
OPERATING EXPENSES:
Selling, general and administrative 26,982 23,170 3,812 16% 84,078 72,073 12,005 17%
Depreciation and amortization 2,379 1,995 384 19% 7,074 5,989 1,085 18%
Marketing and reservation 126,296 119,062 7,234 6% 302,381 284,624 17,757 6%
Hotel operations 956 933 23 2% 2,742 2,609 133 5%
--- --- --- --- ----- ----- --- ---
Total operating expenses 156,613 145,160 11,453 8% 396,275 365,295 30,980 8%
Operating income 66,549 65,253 1,296 2% 147,337 147,908 (571) (0%)
OTHER INCOME AND EXPENSES, NET:
Interest expense 10,757 10,166 591 6% 32,334 16,823 15,511 92%
Interest income (676) (425) (251) 59% (1,979) (1,156) (823) 71%
Loss on extinguishment of debt - 526 (526) (100%) - 526 (526) (100%)
Other (gains) and losses (703) (511) (192) 38% (1,266) (2,137) 871 (41%)
Equity in net (income) loss of affiliates (421) (171) (250) 146% (340) 12 (352) (2933%)
Total other income and expenses, net 8,957 9,585 (628) (7%) 28,749 14,068 14,681 104%
----- ----- ---- --- ------ ------ ------ ---
Income before income taxes 57,592 55,668 1,924 3% 118,588 133,840 (15,252) (11%)
Income taxes 16,080 11,291 4,789 42% 33,319 37,604 (4,285) (11%)
------ ------ ----- --- ------ ------ ------
Net income $41,512 $44,377 $(2,865) (6%) $85,269 $96,236 $(10,967) (11%)
======= ======= ======= === ======= ======= ======== ====
Basic earnings per share $0.71 $0.77 $(0.06) (8%) $1.46 $1.66 $(0.20) (12%)
===== ===== ====== === ===== ===== ====== ====
Diluted earnings per share $0.70 $0.76 $(0.06) (8%) $1.45 $1.65 $(0.20) (12%)
===== ===== ====== === ===== ===== ====== ====
Choice Hotels International, Inc. Exhibit 2
Consolidated Balance Sheets
(In thousands, except per share amounts) September 30, December 31,
2013 2012
---- ----
(Unaudited)
ASSETS
Cash and cash equivalents $161,138 $134,177
Accounts receivable, net 62,605 52,270
Investments, employee benefit plans, at fair value 386 3,486
Other current assets 34,138 43,537
------ ------
Total
current
assets 258,267 233,470
Fixed assets and intangibles, net 142,228 130,937
Receivable -- marketing and reservation fees 32,564 42,179
Investments, employee benefit plans, at fair value 14,950 12,755
Other assets 107,700 91,431
------- ------
Total
assets $555,709 $510,772
-------- --------
LIABILITIES AND SHAREHOLDERS' DEFICIT
Accounts payable and accrued expenses $84,233 $94,266
Deferred revenue 61,401 71,154
Deferred compensation & retirement plan obligations 2,439 2,522
Current portion of long-term debt 9,132 8,195
Other current liabilities 21,906 -
------ ---
Total current
liabilities 179,111 176,137
Long-term debt 815,957 847,150
Deferred compensation & retirement plan obligations 21,219 20,399
Other liabilities 24,146 15,990
------ ------
Total
liabilities 1,040,433 1,059,676
Common stock, $0.01 par value 586 582
Additional paid-in-capital 114,571 110,246
Accumulated other comprehensive loss (5,370) (4,216)
Treasury stock, at cost (919,516) (927,776)
Retained earnings 325,005 272,260
------- -------
Total
shareholders'
deficit (484,724) (548,904)
Total
liabilities
and
shareholders'
deficit $555,709 $510,772
-------- --------
Choice Hotels International, Inc. Exhibit 3
Consolidated Statements of Cash Flows
(Unaudited)
(In thousands) Nine Months Ended September 30,
-------------------------------
Revised (1)
2013 2012
---- ----
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income $85,269 $96,236
Adjustments to reconcile net income to net cash provided
by operating activities:
Depreciation and amortization 7,074 5,989
Provision for bad debts, net 2,054 1,802
Non-cash stock compensation
and other charges 8,638 7,306
Non-cash interest and other
(income) loss 1,057 (633)
Loss on extinguishment of
debt - 526
Deferred income taxes (4,118) (1,627)
Dividends received from
equity method investments 1,109 855
Equity in net (income) loss
of affiliates (340) 12
Changes in assets and liabilities:
Receivables (13,699) (17,405)
Receivable -marketing and
reservation fees, net 23,756 20,811
Forgivable notes receivable,
net (5,722) (2,853)
Accounts payable 1,280 5,980
Accrued expenses (22,757) (10,309)
Income taxes payable/
receivable 24,638 12,786
Deferred revenue (9,686) 8,018
Other assets (2,395) (7,458)
Other liabilities 8,851 (1,613)
----- ------
NET CASH PROVIDED BY
OPERATING ACTIVITIES 105,009 118,423
------- -------
CASH FLOWS FROM INVESTING ACTIVITIES:
Investment in property and
equipment (26,442) (12,525)
Equity method investments (3,761) (9,454)
Purchases of investments,
employee benefit plans (1,845) (1,191)
Proceeds from sales of
investments, employee
benefit plans 4,052 10,909
Issuance of mezzanine and
other notes receivable - (4,236)
Collections of mezzanine and
other notes receivable 224 110
Other items, net (578) (322)
---- ----
NET CASH USED IN INVESTING
ACTIVITIES (28,350) (16,709)
------- -------
CASH FLOWS FROM FINANCING ACTIVITIES:
Net borrowings (repayments)
pursuant to revolving credit
facilities (27,500) 16,725
Principal payments on long-
term debt (6,158) (502)
Proceeds from issuance of
long-term debt 3,360 543,500
Purchase of treasury stock (3,684) (22,227)
Dividends paid (22,026) (632,751)
Excess tax benefits from
stock-based compensation 1,216 793
Debt issuance costs - (4,753)
Proceeds from exercise of
stock options 6,677 4,695
----- -----
NET CASH USED IN FINANCING
ACTIVITIES (48,115) (94,520)
------- -------
Net change in cash and cash
equivalents 28,544 7,194
Effect of foreign exchange
rate changes on cash and
cash equivalents (1,583) 813
Cash and cash equivalents at
beginning of period 134,177 107,057
------- -------
CASH AND CASH EQUIVALENTS AT
END OF PERIOD $161,138 $115,064
======== ========
(1) The presentation of the Company's forgivable notes receivable for the nine months ended September 30, 2012 has
been revised
from prior year disclosures. See Note 1 to the Company's Form 10-Q filed with the SEC on August 9, 2013 for
additional information.
CHOICE HOTELS INTERNATIONAL, INC. Exhibit 4
SUPPLEMENTAL OPERATING INFORMATION
DOMESTIC HOTEL SYSTEM
(UNAUDITED)
For the Nine Months Ended September 30, 2013* For the Nine Months Ended September 30, 2012* Change
-------------------------------------------- -------------------------------------------- ------
Average Daily Average Daily Average Daily
Rate Occupancy RevPAR Rate Occupancy RevPAR Rate Occupancy RevPAR
---- --------- ------ ---- --------- ------ ---- --------- ------
Comfort Inn $83.44 59.8% $49.92 $81.52 59.2% $48.24 2.4% 60 bps 3.5%
Comfort Suites 87.41 63.0% 55.05 85.62 61.8% 52.92 2.1% 120 bps 4.0%
Sleep 74.51 58.7% 43.70 72.29 56.3% 40.68 3.1% 240 bps 7.4%
Quality 70.61 53.2% 37.54 69.84 51.8% 36.14 1.1% 140 bps 3.9%
Clarion 75.66 51.1% 38.64 74.98 49.4% 37.00 0.9% 170 bps 4.4%
Econo Lodge 56.94 48.9% 27.86 55.76 48.7% 27.13 2.1% 20 bps 2.7%
Rodeway 54.63 51.8% 28.29 53.59 51.3% 27.48 1.9% 50 bps 2.9%
MainStay 72.87 67.6% 49.29 69.27 70.4% 48.79 5.2% (280) bps 1.0%
Suburban 42.71 70.3% 30.01 41.24 69.9% 28.82 3.6% 40 bps 4.1%
Ascend Hotel Collection 122.40 64.5% 78.96 112.27 63.5% 71.25 9.0% 100 bps 10.8%
------ ---- ----- ------ ---- ----- --- --- --- ----
Total $75.10 56.4% $42.37 $73.65 55.5% $40.89 2.0% 90 bps 3.6%
====== ==== ====== ====== ==== ====== === === === ===
* Operating statistics represent hotel operations from December through August
For the Three Months Ended September 30, 2013* For the Three Months Ended September 30, 2012* Change
--------------------------------------------- --------------------------------------------- ------
Average Daily Average Daily Average Daily
Rate Occupancy RevPAR Rate Occupancy RevPAR Rate Occupancy RevPAR
---- --------- ------ ---- --------- ------ ---- --------- ------
Comfort Inn $89.49 70.8% $63.35 $87.58 70.2% $61.46 2.2% 60 bps 3.1%
Comfort Suites 91.36 71.2% 65.05 89.69 70.2% 62.93 1.9% 100 bps 3.4%
Sleep 78.45 66.8% 52.38 76.09 64.8% 49.32 3.1% 200 bps 6.2%
Quality 75.81 62.5% 47.36 75.02 61.2% 45.88 1.1% 130 bps 3.2%
Clarion 81.27 59.7% 48.50 79.73 58.7% 46.82 1.9% 100 bps 3.6%
Econo Lodge 61.76 58.1% 35.88 60.60 57.7% 34.97 1.9% 40 bps 2.6%
Rodeway 60.78 60.8% 36.97 59.62 60.8% 36.23 1.9% - bps 2.0%
MainStay 76.91 75.2% 57.82 73.17 76.5% 55.96 5.1% (130) bps 3.3%
Suburban 43.79 73.1% 32.02 42.62 75.1% 32.03 2.7% (200) bps (0.0%)
Ascend Hotel Collection 125.54 71.6% 89.86 115.98 71.4% 82.77 8.2% 20 bps 8.6%
------ ---- ----- ------ ---- ----- --- --- --- ---
Total $80.14 65.7% $52.63 $78.63 65.0% $51.09 1.9% 70 bps 3.0%
====== ==== ====== ====== ==== ====== === === === ===
* Operating statistics represent hotel operations from June through August
For the Quarter Ended For the Nine Months Ended
--------------------- -------------------------
9/30/2013 9/30/2012 9/30/2013 9/30/2012
System-wide effective royalty rate 4.30% 4.29% 4.34% 4.31%
CHOICE HOTELS INTERNATIONAL, INC. Exhibit 5
SUPPLEMENTAL HOTEL AND ROOM SUPPLY DATA
(UNAUDITED)
September 30, 2013 September 30, 2012 Variance
------------------ ------------------ --------
Hotels Rooms Hotels Rooms Hotels Rooms % %
------ ----- ------ ----- ------ ----- --- ---
Comfort Inn 1,312 102,586 1,367 106,970 (55) (4,384) (4.0%) (4.1%)
Comfort Suites 590 45,519 603 46,647 (13) (1,128) (2.2%) (2.4%)
Sleep 378 27,351 390 28,232 (12) (881) (3.1%) (3.1%)
Quality 1,193 98,788 1,101 95,469 92 3,319 8.4% 3.5%
Clarion 188 26,885 187 26,943 1 (58) 0.5% (0.2%)
Econo Lodge 821 50,230 803 49,248 18 982 2.2% 2.0%
Rodeway 434 24,660 409 23,336 25 1,324 6.1% 5.7%
MainStay 43 3,331 39 2,997 4 334 10.3% 11.1%
Suburban 63 7,213 60 6,978 3 235 5.0% 3.4%
Ascend Hotel Collection 94 8,006 56 4,946 38 3,060 67.9% 61.9%
Cambria Suites 18 2,094 19 2,221 (1) (127) (5.3%) (5.7%)
--- ----- --- ----- --- ---- ----- -----
Domestic Franchises 5,134 396,663 5,034 393,987 100 2,676 2.0% 0.7%
International Franchises 1,169 106,000 1,165 102,942 4 3,058 0.3% 3.0%
----- ------- ----- ------- --- ----- --- ---
Total Franchises 6,303 502,663 6,199 496,929 104 5,734 1.7% 1.2%
===== ======= ===== ======= === ===== === ===
Exhibit 6
CHOICE HOTELS INTERNATIONAL, INC.
SUPPLEMENTAL INFORMATION BY BRAND
DEVELOPMENT RESULTS -- DOMESTIC NEW HOTEL CONTRACTS
(UNAUDITED)
For the Nine Months Ended September 30, 2013 For the Nine Months Ended September 30,
2012 % Change
-------------------------------------------- ---------------------------------------- --------
New New New
Construction Conversion Total Construction Conversion Total Construction Conversion Total
------------ ---------- ----- ------------ ---------- ----- ------------ ---------- -----
Comfort Inn 12 35 47 10 17 27 20% 106% 74%
Comfort Suites 7 6 13 11 4 15 (36%) 50% (13%)
Sleep 9 1 10 17 1 18 (47%) 0% (44%)
Quality 1 76 77 - 88 88 NM (14%) (13%)
Clarion 1 12 13 - 14 14 NM (14%) (7%)
Econo Lodge - 61 61 - 33 33 NM 85% 85%
Rodeway 1 39 40 - 46 46 NM (15%) (13%)
MainStay 5 - 5 2 1 3 150% (100%) 67%
Suburban 1 1 2 1 1 2 0% 0% 0%
Ascend Hotel Collection 5 40 45 1 8 9 400% 400% 400%
Cambria Suites 2 - 2 4 - 4 (50%) NM (50%)
--- --- --- --- --- --- ---- --- ----
Total Domestic System 44 271 315 46 213 259 (4%) 27% 22%
=== === === === === === === === ===
For the Three Months Ended September 30, 2013 For the Three Months Ended September 30,
2012 % Change
--------------------------------------------- ----------------------------------------- --------
New New New
Construction Conversion Total Construction Conversion Total Construction Conversion Total
------------ ---------- ----- ------------ ---------- ----- ------------ ---------- -----
Comfort Inn 7 17 24 4 5 9 75% 240% 167%
Comfort Suites 2 4 6 4 - 4 (50%) NM 50%
Sleep 4 1 5 6 - 6 (33%) NM (17%)
Quality - 32 32 - 25 25 NM 28% 28%
Clarion 1 5 6 - 7 7 NM (29%) (14%)
Econo Lodge - 31 31 - 15 15 NM 107% 107%
Rodeway 1 15 16 - 15 15 NM 0% 7%
MainStay 1 - 1 1 - 1 0% NM 0%
Suburban 1 - 1 1 - 1 0% NM 0%
Ascend Hotel Collection 2 4 6 - 4 4 NM 0% 50%
Cambria Suites 1 - 1 2 - 2 (50%) NM (50%)
--- --- --- --- --- --- ---- --- ----
Total Domestic System 20 109 129 18 71 89 11% 54% 45%
=== === === === === === === === ===
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
--------
September 30, 2013 September 30, 2012
Units Units Conversion New Construction Total
----- ----- ---------- ---------------- -----
Conversion New Construction Total Conversion New Construction Total Units % Units % Units %
---------- ---------------- ----- ---------- ---------------- ----- ----- --- ----- --- ----- ---
Comfort Inn 36 50 86 23 39 62 13 57% 11 28% 24 39%
Comfort Suites 4 47 51 1 77 78 3 300% (30) (39%) (27) (35%)
Sleep Inn 1 45 46 1 38 39 - 0% 7 18% 7 18%
Quality 33 3 36 37 3 40 (4) (11%) - 0% (4) (10%)
Clarion 7 2 9 18 1 19 (11) (61%) 1 100% (10) (53%)
Econo Lodge 33 - 33 23 1 24 10 43% (1) (100%) 9 38%
Rodeway 24 1 25 25 - 25 (1) (4%) 1 NM - 0%
MainStay - 26 26 1 18 19 (1) (100%) 8 44% 7 37%
Suburban 3 12 15 2 14 16 1 50% (2) (14%) (1) (6%)
Ascend Hotel Collection 13 10 23 9 4 13 4 44% 6 150% 10 77%
Cambria Suites - 21 21 - 25 25 - NM (4) (16%) (4) (16%)
--- --- --- --- --- --- --- --- --- ---- --- ----
154 217 371 140 220 360 14 10% (3) (1%) 11 3%
=== === === === === === === === === === === ===
CHOICE HOTELS INTERNATIONAL, INC. Exhibit 8
SUPPLEMENTAL NON-GAAP FINANCIAL INFORMATION
(UNAUDITED)
CALCULATION OF FRANCHISING REVENUES AND FRANCHISING MARGINS
(dollar amounts in thousands) Three Months Ended September 30, Nine Months Ended September 30,
-------------------------------- -------------------------------
2013 2012 2013 2012
---- ---- ---- ----
Franchising Revenues:
Total Revenues $223,162 $210,413 $543,612 $513,203
Adjustments:
Marketing and reservation revenues (126,296) (119,062) (302,381) (284,624)
SkyTouch Division (13) - (13) -
Hotel operations (1,310) (1,238) (3,600) (3,440)
Franchising Revenues $95,543 $90,113 $237,618 $225,139
------- ------- -------- --------
Franchising Margins:
Operating Margin:
Total Revenues $223,162 $210,413 $543,612 $513,203
Operating Income $66,549 $65,253 $147,337 $147,908
Operating Margin 29.8% 31.0% 27.1% 28.8%
---- ---- ---- ----
Franchising Margin:
Franchising Revenues $95,543 $90,113 $237,618 $225,139
Operating Income $66,549 $65,253 $147,337 $147,908
SkyTouch Division operating loss 3,272 720 8,768 2,074
Hotel operations operating income (354) (305) (858) (831)
Operating Income - Franchising $69,467 $65,668 $155,247 $149,151
------- ------- -------- --------
Franchising Margins 72.7% 72.9% 65.3% 66.2%
---- ---- ---- ----
CALCULATION OF FRANCHISING SELLING, GENERAL AND ADMINISTRATION EXPENSES
(dollar amounts in thousands)
Three Months Ended September 30, Nine Months Ended September 30,
-------------------------------- -------------------------------
2013 2012 2013 2012
---- ---- ---- ----
Total Selling, General and Administrative Expenses $26,982 $23,170 $84,078 $72,073
SkyTouch Division (3,189) (719) (8,590) (2,073)
Franchising Selling, General and Administration Expenses $23,793 $22,451 $75,488 $70,000
======= ======= ======= =======
CALCULATION OF EBITDA
(dollar amounts in thousands)
Q3 2013 Actuals Q3 2012 Actuals Nine Months Ended Nine Months Ended
September 30, 2013 September 30, 2012
Actuals Actuals
------- -------
Net income $41,512 $44,377 $85,269 $96,236
Income taxes 16,080 11,291 33,319 37,604
Interest expense 10,757 10,166 32,334 16,823
Interest income (676) (425) (1,979) (1,156)
Other (gains) and losses (703) (511) (1,266) (2,137)
Loss on the extinguishment of debt - 526 - 526
Equity in net (income) loss of affiliates (421) (171) (340) 12
Depreciation and amortization 2,379 1,995 7,074 5,989
EBITDA $68,928 $67,248 $154,411 $153,897
======= ======= ======== ========
SOURCE Choice Hotels International, Inc.
SOURCE: Choice Hotels International, Inc.
PR Newswire
ROCKVILLE, Md., Oct. 24, 2013
ROCKVILLE, Md., Oct. 24, 2013 /PRNewswire/ -- Choice Hotels International, Inc., (NYSE: CHH) today reported the following highlights for the third quarter of 2013:
(Logo: http://photos.prnewswire.com/prnh/20131015/NE98133LOGO-l)
"Our franchising business continues to outperform our expectations. We are particularly pleased with recent activities on the development side of the business highlighted by a 45% increase in new domestic franchise contracts. The increase was driven by a 130% improvement in contracts for our flagship Comfort brands," said Stephen P. Joyce, president and chief executive officer, Choice Hotels International. "The Ascend Hotel Collection continues its rapid growth. This quarter we expanded in Europe and added another Ascend hotel in Australia. The Ascend Hotel Collection now has more than 115 worldwide locations, and we are excited about the future growth prospects of this brand as well as our family of brands."
Use of Free Cash Flow
The company has historically used its free cash flow (cash flow from operations less cash flow from investing activities) to return value to shareholders, primarily through share repurchases and dividends.
Dividends
The company's current quarterly dividend rate per common share is $0.185, subject to declaration by our board of directors. During the nine months ending September 30, 2013 and 2012, the company paid $22.0 million and $632.8 million in cash dividends to shareholders, respectively. The cash dividends paid during the nine months ending September 2013 reflect the company's decision to pay the first quarter of 2013 quarterly cash dividend in December 2012. In addition, cash dividends paid during the nine months ending September 30, 2012 include a special cash dividend in the amount of $10.41 per share or approximately $600.7 million paid on August 23, 2012.
As a result of the payment of the special cash dividend, earnings per share for the nine months ending September 30, 2013 include $15.5 million of additional interest expense compared to the prior year reflecting the financing transactions entered into during the second and third quarters of 2012.
Share Repurchases
The company did not repurchase any shares of common stock under the share repurchase program during the three and nine months ending September 30, 2013 but has authorization to purchase up to an additional 1.4 million shares under this program. We expect we will make repurchases from time to time under our share repurchase program in the open market and through privately negotiated transactions, subject to market and other conditions. There is no time limit on this authorization and no minimum number of share repurchases has been fixed. Since Choice announced its stock repurchase program on June 25, 1998 through September 30, 2013, the company has repurchased 45.3 million shares of its common stock for a total cost of $1.1 billion. Considering the effect of a two-for-one stock split in October 2005, the company has repurchased 78.3 million shares through September 30, 2013 under the share repurchase program at an average price of $13.89 per share.
Other
Our board of directors previously authorized us to enter into a program which permits 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 strategic markets. Over the next several years, we expect to continue to opportunistically deploy capital pursuant to this program to promote growth of our emerging brands. Our current expectation is that our annual investment in this program will range between $20 million and $40 million per year and we generally expect to recycle these investments over a 5 year period. However, the amount and timing of the investment in this program will be dependent on market and other conditions. Notwithstanding this program, 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.
Balance Sheet
As of September 30, 2013, the company had total debt (long-term plus current portion) of $825 million and cash and cash equivalents totaling $161 million resulting in net debt of $664 million. At December 31, 2012, the company had total debt of $855 million and cash equivalents totaling $134 million resulting in net debt of $721 million.
As of September 30, 2013 and December 31, 2012, the company had outstanding mezzanine financing, real estate investments and sliver equity investments totaling $71 million and $68 million, respectively, pursuant to its program to offer financing and investment support to incent franchise development for emerging brands in strategic markets. These investments are reported in other current assets and other assets on the company's consolidated balance sheet.
Outlook
The company's fourth quarter 2013 diluted EPS is expected to range between $0.44 and $0.46. The company expects full-year 2013 diluted EPS to range between $1.89 and $1.91. Earnings before interest, taxes, depreciation and amortization ("EBITDA") for full-year 2013 are expected to range between $203.5 million and $205.5 million. These estimates include the following assumptions:
Conference Call
Choice will conduct a conference call on Thursday, October 24, 2013 at 9:30 a.m. EDT to discuss the company's third quarter 2013 results. The dial-in number to listen to the call is 1-800-901-5213, and the access code is 73582897. International callers should dial 1-617-786-2962 and enter the access code 73582897. 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 1:30 p.m. EDT on Thursday October 24, 2013 through Thursday, October 31, 2013 by calling 1-888-286-8010 and entering access code 43130503. The international dial-in number for the replay is 1-617-801-6888, access code 43130503. In addition, the call will be archived for approximately one-year and available on www.choicehotels.com via the Investor Info link.
About Choice Hotels
Choice Hotels International, Inc. franchises more than 6,300 hotels, representing more than 500,000 rooms, in the United States and more than 30 other countries and territories. As of September 30, 2013, 371 hotels, representing more than 29,000 rooms, were under construction, awaiting conversion or approved for development in the United States. Additionally, 84 hotels, representing approximately 7,200 rooms, were under construction, awaiting conversion or approved for development in more than 15 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, as well as its Ascend Hotel Collection membership program, serve guests worldwide.
SkyTouch Technology is an initiative of Choice Hotels International, Inc. that develops and markets cloud-based technology products to help industry-wide hoteliers improve their efficiency and profitability.
Additional corporate information can 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 release constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Generally, our use of words such as "expect," "estimate," "believe," "anticipate," "will," "forecast," "plan"," project," "assume" or similar words of futurity identify such 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 the company's revenue, earnings and other financial and operational measures, company debt levels, ability to repay outstanding indebtedness, payment of 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; and our 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, 2012, filed with the Securities and Exchange Commission on February 28, 2013 and our quarterly reports filed on Form 10-Q. 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 Presented in this Press Release
EBITDA, franchising revenues, franchising SG&A, franchising margins and net debt are non-GAAP financial measurements. These measures should not be considered as an alternative to any measure of performance or liquidity as promulgated under or authorized by generally accepted accounting principles in the United States ("GAAP"), such as operating income, total revenues, operating margins and long-term debt. 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 EBITDA, franchising revenues, franchising SG&A and franchising margins to the most comparable GAAP financial measures. 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, loss on extinguishment of debt, interest income, provision for income taxes, depreciation and amortization, other (gains) and losses and equity in net income (loss) of unconsolidated affiliates. We consider EBITDA to be an indicator of operating performance because we use it to measure our ability to service debt, fund capital expenditures, and expand our business. We also use EBITDA, as do analysts, lenders, investors and others, to evaluate companies because it excludes certain items that can vary widely across different 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. Accordingly, the impact of interest expense 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. EBITDA also excludes depreciation and amortization because companies utilize productive assets of different ages and use different methods of both acquiring and depreciating productive assets. These differences can result in considerable variability in the relative costs of productive assets and the depreciation and amortization expense among companies.
Franchising Revenues, Operating Income, SG&A and Margins: The company reports franchising revenues, operating income, SG&A and margins which exclude marketing and reservation revenues, SkyTouch Technology and hotel operations. Marketing and reservation activities are excluded from franchising revenues and operating margins since the company is required by its franchise agreements to use these fees collected for marketing and reservation activities. Cumulative reservation and marketing system fees not expended are recorded as a liability on the company's financial statements and are carried over to the next year and expended in accordance with the franchise agreements. Cumulative marketing and reservation expenditures in excess of system 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 reflect the company's ownership of three MainStay Suites hotels. SkyTouch Technology is a division of the company that develops and markets cloud-based technology products to help industry-wide hoteliers improve their efficiency and profitability. Hotel and SkyTouch Technology operations are excluded from franchising revenue and margins since they do not reflect the company's core franchising business but are adjacent, complimentary lines of business. These non-GAAP measures are a commonly used measure of performance in our industry and facilitate comparisons between the company and its competitors.
Net Debt: Net debt is long-term debt plus the current portion of long-term debt (i.e., long-term debt due within one year) less cash and cash equivalents. The company believes that net debt is an important measurement as many investors use net debt in making investment decisions, as it gives them an idea of a company's financial health and its level of leverage compared to liquid assets. Some industries may have more net debt than others; therefore, investors often compare a company's net debt to others in the same business.
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, Ascend Hotel Collection and SkyTouch Technologyare proprietary trademarks and service marks of Choice Hotels International.
© 2013 Choice Hotels International, Inc. All rights reserved.
|
Choice Hotels International, Inc. |
Exhibit 1 |
||||||||||||||||||
|
Consolidated Statements of Income |
|||||||||||||||||||
|
(Unaudited) |
|||||||||||||||||||
|
Three Months Ended September 30, |
Nine Months Ended September 30, |
||||||||||||||||||
|
Variance |
Variance |
||||||||||||||||||
|
2013 |
2012 |
$ |
% |
2013 |
2012 |
$ |
% |
||||||||||||
|
(In thousands, except per share amounts) |
|||||||||||||||||||
|
REVENUES: |
|||||||||||||||||||
|
Royalty fees |
$ 83,107 |
$ 80,845 |
$ 2,262 |
3% |
$ 201,222 |
$ 194,762 |
$ 6,460 |
3% |
|||||||||||
|
Initial franchise and relicensing fees |
4,650 |
3,247 |
1,403 |
43% |
12,843 |
8,953 |
3,890 |
43% |
|||||||||||
|
Procurement services |
4,708 |
3,839 |
869 |
23% |
16,204 |
13,990 |
2,214 |
16% |
|||||||||||
|
Marketing and reservation |
126,296 |
119,062 |
7,234 |
6% |
302,381 |
284,624 |
17,757 |
6% |
|||||||||||
|
Hotel operations |
1,310 |
1,238 |
72 |
6% |
3,600 |
3,440 |
160 |
5% |
|||||||||||
|
Other |
3,091 |
2,182 |
909 |
42% |
7,362 |
7,434 |
(72) |
(1%) |
|||||||||||
|
Total revenues |
223,162 |
210,413 |
12,749 |
6% |
543,612 |
513,203 |
30,409 |
6% |
|||||||||||
|
OPERATING EXPENSES: |
|||||||||||||||||||
|
Selling, general and administrative |
26,982 |
23,170 |
3,812 |
16% |
84,078 |
72,073 |
12,005 |
17% |
|||||||||||
|
Depreciation and amortization |
2,379 |
1,995 |
384 |
19% |
7,074 |
5,989 |
1,085 |
18% |
|||||||||||
|
Marketing and reservation |
126,296 |
119,062 |
7,234 |
6% |
302,381 |
284,624 |
17,757 |
6% |
|||||||||||
|
Hotel operations |
956 |
933 |
23 |
2% |
2,742 |
2,609 |
133 |
5% |
|||||||||||
|
Total operating expenses |
156,613 |
145,160 |
11,453 |
8% |
396,275 |
365,295 |
30,980 |
8% |
|||||||||||
|
Operating income |
66,549 |
65,253 |
1,296 |
2% |
147,337 |
147,908 |
(571) |
(0%) |
|||||||||||
|
OTHER INCOME AND EXPENSES, NET: |
|||||||||||||||||||
|
Interest expense |
10,757 |
10,166 |
591 |
6% |
32,334 |
16,823 |
15,511 |
92% |
|||||||||||
|
Interest income |
(676) |
(425) |
(251) |
59% |
(1,979) |
(1,156) |
(823) |
71% |
|||||||||||
|
Loss on extinguishment of debt |
- |
526 |
(526) |
(100%) |
- |
526 |
(526) |
(100%) |
|||||||||||
|
Other (gains) and losses |
(703) |
(511) |
(192) |
38% |
(1,266) |
(2,137) |
871 |
(41%) |
|||||||||||
|
Equity in net (income) loss of affiliates |
(421) |
(171) |
(250) |
146% |
(340) |
12 |
(352) |
(2933%) |
|||||||||||
|
Total other income and expenses, net |
8,957 |
9,585 |
(628) |
(7%) |
28,749 |
14,068 |
14,681 |
104% |
|||||||||||
|
Income before income taxes |
57,592 |
55,668 |
1,924 |
3% |
118,588 |
133,840 |
(15,252) |
(11%) |
|||||||||||
|
Income taxes |
16,080 |
11,291 |
4,789 |
42% |
33,319 |
37,604 |
(4,285) |
(11%) |
|||||||||||
|
Net income |
$ 41,512 |
$ 44,377 |
$ (2,865) |
(6%) |
$ 85,269 |
$ 96,236 |
$ (10,967) |
(11%) |
|||||||||||
|
Basic earnings per share |
$ 0.71 |
$ 0.77 |
$ (0.06) |
(8%) |
$ 1.46 |
$ 1.66 |
$ (0.20) |
(12%) |
|||||||||||
|
Diluted earnings per share |
$ 0.70 |
$ 0.76 |
$ (0.06) |
(8%) |
$ 1.45 |
$ 1.65 |
$ (0.20) |
(12%) |
|||||||||||
|
Choice Hotels International, Inc. |
Exhibit 2 |
||||||
|
Consolidated Balance Sheets |
|||||||
|
(In thousands, except per share amounts) |
September 30, |
December 31, |
|||||
|
2013 |
2012 |
||||||
|
(Unaudited) |
|||||||
|
ASSETS |
|||||||
|
Cash and cash equivalents |
$ 161,138 |
$ 134,177 |
|||||
|
Accounts receivable, net |
62,605 |
52,270 |
|||||
|
Investments, employee benefit plans, at fair value |
386 |
3,486 |
|||||
|
Other current assets |
34,138 |
43,537 |
|||||
|
Total current assets |
258,267 |
233,470 |
|||||
|
Fixed assets and intangibles, net |
142,228 |
130,937 |
|||||
|
Receivable -- marketing and reservation fees |
32,564 |
42,179 |
|||||
|
Investments, employee benefit plans, at fair value |
14,950 |
12,755 |
|||||
|
Other assets |
107,700 |
91,431 |
|||||
|
Total assets |
$ 555,709 |
$ 510,772 |
|||||
|
LIABILITIES AND SHAREHOLDERS' DEFICIT |
|||||||
|
Accounts payable and accrued expenses |
$ 84,233 |
$ 94,266 |
|||||
|
Deferred revenue |
61,401 |
71,154 |
|||||
|
Deferred compensation & retirement plan obligations |
2,439 |
2,522 |
|||||
|
Current portion of long-term debt |
9,132 |
8,195 |
|||||
|
Other current liabilities |
21,906 |
- |
|||||
|
Total current liabilities |
179,111 |
176,137 |
|||||
|
Long-term debt |
815,957 |
847,150 |
|||||
|
Deferred compensation & retirement plan obligations |
21,219 |
20,399 |
|||||
|
Other liabilities |
24,146 |
15,990 |
|||||
|
Total liabilities |
1,040,433 |
1,059,676 |
|||||
|
Common stock, $0.01 par value |
586 |
582 |
|||||
|
Additional paid-in-capital |
114,571 |
110,246 |
|||||
|
Accumulated other comprehensive loss |
(5,370) |
(4,216) |
|||||
|
Treasury stock, at cost |
(919,516) |
(927,776) |
|||||
|
Retained earnings |
325,005 |
272,260 |
|||||
|
Total shareholders' deficit |
(484,724) |
(548,904) |
|||||
|
Total liabilities and shareholders' deficit |
$ 555,709 |
$ 510,772 |
|||||
|
Choice Hotels International, Inc. |
Exhibit 3 |
||
|
Consolidated Statements of Cash Flows |
|||
|
(Unaudited) |
|||
|
(In thousands) |
Nine Months Ended September 30, |
||
|
Revised (1) |
|||
|
2013 |
2012 |
||
|
CASH FLOWS FROM OPERATING ACTIVITIES: |
|||
|
Net income |
$ 85,269 |
$ 96,236 |
|
|
Adjustments to reconcile net income to net cash provided |
|||
|
by operating activities: |
|||
|
Depreciation and amortization |
7,074 |
5,989 |
|
|
Provision for bad debts, net |
2,054 |
1,802 |
|
|
Non-cash stock compensation and other charges |
8,638 |
7,306 |
|
|
Non-cash interest and other (income) loss |
1,057 |
(633) |
|
|
Loss on extinguishment of debt |
- |
526 |
|
|
Deferred income taxes |
(4,118) |
(1,627) |
|
|
Dividends received from equity method investments |
1,109 |
855 |
|
|
Equity in net (income) loss of affiliates |
(340) |
12 |
|
|
Changes in assets and liabilities: |
|||
|
Receivables |
(13,699) |
(17,405) |
|
|
Receivable - marketing and reservation fees, net |
23,756 |
20,811 |
|
|
Forgivable notes receivable, net |
(5,722) |
(2,853) |
|
|
Accounts payable |
1,280 |
5,980 |
|
|
Accrued expenses |
(22,757) |
(10,309) |
|
|
Income taxes payable/receivable |
24,638 |
12,786 |
|
|
Deferred revenue |
(9,686) |
8,018 |
|
|
Other assets |
(2,395) |
(7,458) |
|
|
Other liabilities |
8,851 |
(1,613) |
|
|
NET CASH PROVIDED BY OPERATING ACTIVITIES |
105,009 |
118,423 |
|
|
CASH FLOWS FROM INVESTING ACTIVITIES: |
|||
|
Investment in property and equipment |
(26,442) |
(12,525) |
|
|
Equity method investments |
(3,761) |
(9,454) |
|
|
Purchases of investments, employee benefit plans |
(1,845) |
(1,191) |
|
|
Proceeds from sales of investments, employee benefit plans |
4,052 |
10,909 |
|
|
Issuance of mezzanine and other notes receivable |
- |
(4,236) |
|
|
Collections of mezzanine and other notes receivable |
224 |
110 |
|
|
Other items, net |
(578) |
(322) |
|
|
NET CASH USED IN INVESTING ACTIVITIES |
(28,350) |
(16,709) |
|
|
CASH FLOWS FROM FINANCING ACTIVITIES: |
|||
|
Net borrowings (repayments) pursuant to revolving credit facilities |
(27,500) |
16,725 |
|
|
Principal payments on long-term debt |
(6,158) |
(502) |
|
|
Proceeds from issuance of long-term debt |
3,360 |
543,500 |
|
|
Purchase of treasury stock |
(3,684) |
(22,227) |
|
|
Dividends paid |
(22,026) |
(632,751) |
|
|
Excess tax benefits from stock-based compensation |
1,216 |
793 |
|
|
Debt issuance costs |
- |
(4,753) |
|
|
Proceeds from exercise of stock options |
6,677 |
4,695 |
|
|
NET CASH USED IN FINANCING ACTIVITIES |
(48,115) |
(94,520) |
|
|
Net change in cash and cash equivalents |
28,544 |
7,194 |
|
|
Effect of foreign exchange rate changes on cash and cash equivalents |
(1,583) |
813 |
|
|
Cash and cash equivalents at beginning of period |
134,177 |
107,057 |
|
|
CASH AND CASH EQUIVALENTS AT END OF PERIOD |
$ 161,138 |
$ 115,064 |
|
|
(1) The presentation of the Company's forgivable notes receivable for the nine months ended September 30, 2012 has been revised |
|||
|
from prior year disclosures. See Note 1 to the Company's Form 10-Q filed with the SEC on August 9, 2013 for additional information. |
|||
|
CHOICE HOTELS INTERNATIONAL, INC. |
Exhibit 4 |
||||||||||||||||||||
|
SUPPLEMENTAL OPERATING INFORMATION |
|||||||||||||||||||||
|
DOMESTIC HOTEL SYSTEM |
|||||||||||||||||||||
|
(UNAUDITED) |
|||||||||||||||||||||
|
For the Nine Months Ended September 30, 2013* |
For the Nine Months Ended September 30, 2012* |
Change |
|||||||||||||||||||
|
Average Daily |
Average Daily |
Average Daily |
|||||||||||||||||||
|
Rate |
Occupancy |
RevPAR |
Rate |
Occupancy |
RevPAR |
Rate |
Occupancy |
RevPAR |
|||||||||||||
|
Comfort Inn |
$ 83.44 |
59.8% |
$ 49.92 |
$ 81.52 |
59.2% |
$ 48.24 |
2.4% |
60 |
bps |
3.5% |
|||||||||||
|
Comfort Suites |
87.41 |
63.0% |
55.05 |
85.62 |
61.8% |
52.92 |
2.1% |
120 |
bps |
4.0% |
|||||||||||
|
Sleep |
74.51 |
58.7% |
43.70 |
72.29 |
56.3% |
40.68 |
3.1% |
240 |
bps |
7.4% |
|||||||||||
|
Quality |
70.61 |
53.2% |
37.54 |
69.84 |
51.8% |
36.14 |
1.1% |
140 |
bps |
3.9% |
|||||||||||
|
Clarion |
75.66 |
51.1% |
38.64 |
74.98 |
49.4% |
37.00 |
0.9% |
170 |
bps |
4.4% |
|||||||||||
|
Econo Lodge |
56.94 |
48.9% |
27.86 |
55.76 |
48.7% |
27.13 |
2.1% |
20 |
bps |
2.7% |
|||||||||||
|
Rodeway |
54.63 |
51.8% |
28.29 |
53.59 |
51.3% |
27.48 |
1.9% |
50 |
bps |
2.9% |
|||||||||||
|
MainStay |
72.87 |
67.6% |
49.29 |
69.27 |
70.4% |
48.79 |
5.2% |
(280) |
bps |
1.0% |
|||||||||||
|
Suburban |
42.71 |
70.3% |
30.01 |
41.24 |
69.9% |
28.82 |
3.6% |
40 |
bps |
4.1% |
|||||||||||
|
Ascend Hotel Collection |
122.40 |
64.5% |
78.96 |
112.27 |
63.5% |
71.25 |
9.0% |
100 |
bps |
10.8% |
|||||||||||
|
Total |
$ 75.10 |
56.4% |
$ 42.37 |
$ 73.65 |
55.5% |
$ 40.89 |
2.0% |
90 |
bps |
3.6% |
|||||||||||
|
* Operating statistics represent hotel operations from December through August |
|||||||||||||||||||||
|
For the Three Months Ended September 30, 2013* |
For the Three Months Ended September 30, 2012* |
Change |
|||||||||||||||||||
|
Average Daily |
Average Daily |
Average Daily |
|||||||||||||||||||
|
Rate |
Occupancy |
RevPAR |
Rate |
Occupancy |
RevPAR |
Rate |
Occupancy |
RevPAR |
|||||||||||||
|
Comfort Inn |
$ 89.49 |
70.8% |
$ 63.35 |
$ 87.58 |
70.2% |
$ 61.46 |
2.2% |
60 |
bps |
3.1% |
|||||||||||
|
Comfort Suites |
91.36 |
71.2% |
65.05 |
89.69 |
70.2% |
62.93 |
1.9% |
100 |
bps |
3.4% |
|||||||||||
|
Sleep |
78.45 |
66.8% |
52.38 |
76.09 |
64.8% |
49.32 |
3.1% |
200 |
bps |
6.2% |
|||||||||||
|
Quality |
75.81 |
62.5% |
47.36 |
75.02 |
61.2% |
45.88 |
1.1% |
130 |
bps |
3.2% |
|||||||||||
|
Clarion |
81.27 |
59.7% |
48.50 |
79.73 |
58.7% |
46.82 |
1.9% |
100 |
bps |
3.6% |
|||||||||||
|
Econo Lodge |
61.76 |
58.1% |
35.88 |
60.60 |
57.7% |
34.97 |
1.9% |
40 |
bps |
2.6% |
|||||||||||
|
Rodeway |
60.78 |
60.8% |
36.97 |
59.62 |
60.8% |
36.23 |
1.9% |
- |
bps |
2.0% |
|||||||||||
|
MainStay |
76.91 |
75.2% |
57.82 |
73.17 |
76.5% |
55.96 |
5.1% |
(130) |
bps |
3.3% |
|||||||||||
|
Suburban |
43.79 |
73.1% |
32.02 |
42.62 |
75.1% |
32.03 |
2.7% |
(200) |
bps |
(0.0%) |
|||||||||||
|
Ascend Hotel Collection |
125.54 |
71.6% |
89.86 |
115.98 |
71.4% |
82.77 |
8.2% |
20 |
bps |
8.6% |
|||||||||||
|
Total |
$ 80.14 |
65.7% |
$ 52.63 |
$ 78.63 |
65.0% |
$ 51.09 |
1.9% |
70 |
bps |
3.0% |
|||||||||||
|
* Operating statistics represent hotel operations from June through August |
|||||||||||||||||||||
|
For the Quarter Ended |
For the Nine Months Ended |
||||||||||||||||||||
|
9/30/2013 |
9/30/2012 |
9/30/2013 |
9/30/2012 |
||||||||||||||||||
|
System-wide effective royalty rate |
4.30% |
4.29% |
4.34% |
4.31% |
|||||||||||||||||
|
CHOICE HOTELS INTERNATIONAL, INC. |
Exhibit 5 |
||||||||||||||||
|
SUPPLEMENTAL HOTEL AND ROOM SUPPLY DATA |
|||||||||||||||||
|
(UNAUDITED) |
|||||||||||||||||
|
September 30, 2013 |
September 30, 2012 |
Variance |
|||||||||||||||
|
Hotels |
Rooms |
Hotels |
Rooms |
Hotels |
Rooms |
% |
% |
||||||||||
|
Comfort Inn |
1,312 |
102,586 |
1,367 |
106,970 |
(55) |
(4,384) |
(4.0%) |
(4.1%) |
|||||||||
|
Comfort Suites |
590 |
45,519 |
603 |
46,647 |
(13) |
(1,128) |
(2.2%) |
(2.4%) |
|||||||||
|
Sleep |
378 |
27,351 |
390 |
28,232 |
(12) |
(881) |
(3.1%) |
(3.1%) |
|||||||||
|
Quality |
1,193 |
98,788 |
1,101 |
95,469 |
92 |
3,319 |
8.4% |
3.5% |
|||||||||
|
Clarion |
188 |
26,885 |
187 |
26,943 |
1 |
(58) |
0.5% |
(0.2%) |
|||||||||
|
Econo Lodge |
821 |
50,230 |
803 |
49,248 |
18 |
982 |
2.2% |
2.0% |
|||||||||
|
Rodeway |
434 |
24,660 |
409 |
23,336 |
25 |
1,324 |
6.1% |
5.7% |
|||||||||
|
MainStay |
43 |
3,331 |
39 |
2,997 |
4 |
334 |
10.3% |
11.1% |
|||||||||
|
Suburban |
63 |
7,213 |
60 |
6,978 |
3 |
235 |
5.0% |
3.4% |
|||||||||
|
Ascend Hotel Collection |
94 |
8,006 |
56 |
4,946 |
38 |
3,060 |
67.9% |
61.9% |
|||||||||
|
Cambria Suites |
18 |
2,094 |
19 |
2,221 |
(1) |
(127) |
(5.3%) |
(5.7%) |
|||||||||
|
Domestic Franchises |
5,134 |
396,663 |
5,034 |
393,987 |
100 |
2,676 |
2.0% |
0.7% |
|||||||||
|
International Franchises |
1,169 |
106,000 |
1,165 |
102,942 |
4 |
3,058 |
0.3% |
3.0% |
|||||||||
|
Total Franchises |
6,303 |
502,663 |
6,199 |
496,929 |
104 |
5,734 |
1.7% |
1.2% |
|||||||||
|
Exhibit 6 |
||||||||||||||||||||
|
CHOICE HOTELS INTERNATIONAL, INC. |
||||||||||||||||||||
|
SUPPLEMENTAL INFORMATION BY BRAND |
||||||||||||||||||||
|
DEVELOPMENT RESULTS -- DOMESTIC NEW HOTEL CONTRACTS |
||||||||||||||||||||
|
(UNAUDITED) |
||||||||||||||||||||
|
For the Nine Months Ended September 30, 2013 |
For the Nine Months Ended September 30, 2012 |
% Change |
||||||||||||||||||
|
New |
New |
New |
||||||||||||||||||
|
Construction |
Conversion |
Total |
Construction |
Conversion |
Total |
Construction |
Conversion |
Total |
||||||||||||
|
Comfort Inn |
12 |
35 |
47 |
10 |
17 |
27 |
20% |
106% |
74% |
|||||||||||
|
Comfort Suites |
7 |
6 |
13 |
11 |
4 |
15 |
(36%) |
50% |
(13%) |
|||||||||||
|
Sleep |
9 |
1 |
10 |
17 |
1 |
18 |
(47%) |
0% |
(44%) |
|||||||||||
|
Quality |
1 |
76 |
77 |
- |
88 |
88 |
NM |
(14%) |
(13%) |
|||||||||||
|
Clarion |
1 |
12 |
13 |
- |
14 |
14 |
NM |
(14%) |
(7%) |
|||||||||||
|
Econo Lodge |
- |
61 |
61 |
- |
33 |
33 |
NM |
85% |
85% |
|||||||||||
|
Rodeway |
1 |
39 |
40 |
- |
46 |
46 |
NM |
(15%) |
(13%) |
|||||||||||
|
MainStay |
5 |
- |
5 |
2 |
1 |
3 |
150% |
(100%) |
67% |
|||||||||||
|
Suburban |
1 |
1 |
2 |
1 |
1 |
2 |
0% |
0% |
0% |
|||||||||||
|
Ascend Hotel Collection |
5 |
40 |
45 |
1 |
8 |
9 |
400% |
400% |
400% |
|||||||||||
|
Cambria Suites |
2 |
- |
2 |
4 |
- |
4 |
(50%) |
NM |
(50%) |
|||||||||||
|
Total Domestic System |
44 |
271 |
315 |
46 |
213 |
259 |
(4%) |
27% |
22% |
|||||||||||
|
For the Three Months Ended September 30, 2013 |
For the Three Months Ended September 30, 2012 |
% Change |
||||||||||||||||||
|
New |
New |
New |
||||||||||||||||||
|
Construction |
Conversion |
Total |
Construction |
Conversion |
Total |
Construction |
Conversion |
Total |
||||||||||||
|
Comfort Inn |
7 |
17 |
24 |
4 |
5 |
9 |
75% |
240% |
167% |
|||||||||||
|
Comfort Suites |
2 |
4 |
6 |
4 |
- |
4 |
(50%) |
NM |
50% |
|||||||||||
|
Sleep |
4 |
1 |
5 |
6 |
- |
6 |
(33%) |
NM |
(17%) |
|||||||||||
|
Quality |
- |
32 |
32 |
- |
25 |
25 |
NM |
28% |
28% |
|||||||||||
|
Clarion |
1 |
5 |
6 |
- |
7 |
7 |
NM |
(29%) |
(14%) |
|||||||||||
|
Econo Lodge |
- |
31 |
31 |
- |
15 |
15 |
NM |
107% |
107% |
|||||||||||
|
Rodeway |
1 |
15 |
16 |
- |
15 |
15 |
NM |
0% |
7% |
|||||||||||
|
MainStay |
1 |
- |
1 |
1 |
- |
1 |
0% |
NM |
0% |
|||||||||||
|
Suburban |
1 |
- |
1 |
1 |
- |
1 |
0% |
NM |
0% |
|||||||||||
|
Ascend Hotel Collection |
2 |
4 |
6 |
- |
4 |
4 |
NM |
0% |
50% |
|||||||||||
|
Cambria Suites |
1 |
- |
1 |
2 |
- |
2 |
(50%) |
NM |
(50%) |
|||||||||||
|
Total Domestic System |
20 |
109 |
129 |
18 |
71 |
89 |
11% |
54% |
45% |
|||||||||||
|
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 |
||||||||||||||||||||||||
|
September 30, 2013 |
September 30, 2012 |
|||||||||||||||||||||||
|
Units |
Units |
Conversion |
New Construction |
Total |
||||||||||||||||||||
|
Conversion |
New Construction |
Total |
Conversion |
New Construction |
Total |
Units |
% |
Units |
% |
Units |
% |
|||||||||||||
|
Comfort Inn |
36 |
50 |
86 |
23 |
39 |
62 |
13 |
57% |
11 |
28% |
24 |
39% |
||||||||||||
|
Comfort Suites |
4 |
47 |
51 |
1 |
77 |
78 |
3 |
300% |
(30) |
(39%) |
(27) |
(35%) |
||||||||||||
|
Sleep Inn |
1 |
45 |
46 |
1 |
38 |
39 |
- |
0% |
7 |
18% |
7 |
18% |
||||||||||||
|
Quality |
33 |
3 |
36 |
37 |
3 |
40 |
(4) |
(11%) |
- |
0% |
(4) |
(10%) |
||||||||||||
|
Clarion |
7 |
2 |
9 |
18 |
1 |
19 |
(11) |
(61%) |
1 |
100% |
(10) |
(53%) |
||||||||||||
|
Econo Lodge |
33 |
- |
33 |
23 |
1 |
24 |
10 |
43% |
(1) |
(100%) |
9 |
38% |
||||||||||||
|
Rodeway |
24 |
1 |
25 |
25 |
- |
25 |
(1) |
(4%) |
1 |
NM |
- |
0% |
||||||||||||
|
MainStay |
- |
26 |
26 |
1 |
18 |
19 |
(1) |
(100%) |
8 |
44% |
7 |
37% |
||||||||||||
|
Suburban |
3 |
12 |
15 |
2 |
14 |
16 |
1 |
50% |
(2) |
(14%) |
(1) |
(6%) |
||||||||||||
|
Ascend Hotel Collection |
13 |
10 |
23 |
9 |
4 |
13 |
4 |
44% |
6 |
150% |
10 |
77% |
||||||||||||
|
Cambria Suites |
- |
21 |
21 |
- |
25 |
25 |
- |
NM |
(4) |
(16%) |
(4) |
(16%) |
||||||||||||
|
154 |
217 |
371 |
140 |
220 |
360 |
14 |
10% |
(3) |
(1%) |
11 |
3% |
|||||||||||||
|
CHOICE HOTELS INTERNATIONAL, INC. |
Exhibit 8 |
|||||||||||
|
SUPPLEMENTAL NON-GAAP FINANCIAL INFORMATION |
||||||||||||
|
(UNAUDITED) |
||||||||||||
|
CALCULATION OF FRANCHISING REVENUES AND FRANCHISING MARGINS |
||||||||||||
|
(dollar amounts in thousands) |
Three Months Ended September 30, |
Nine Months Ended September 30, |
||||||||||
|
2013 |
2012 |
2013 |
2012 |
|||||||||
|
Franchising Revenues: |
||||||||||||
|
Total Revenues |
$ 223,162 |
$ 210,413 |
$ 543,612 |
$ 513,203 |
||||||||
|
Adjustments: |
||||||||||||
|
Marketing and reservation revenues |
(126,296) |
(119,062) |
(302,381) |
(284,624) |
||||||||
|
SkyTouch Division |
(13) |
- |
(13) |
- |
||||||||
|
Hotel operations |
(1,310) |
(1,238) |
(3,600) |
(3,440) |
||||||||
|
Franchising Revenues |
$ 95,543 |
$ 90,113 |
$ 237,618 |
$ 225,139 |
||||||||
|
Franchising Margins: |
||||||||||||
|
Operating Margin: |
||||||||||||
|
Total Revenues |
$ 223,162 |
$ 210,413 |
$ 543,612 |
$ 513,203 |
||||||||
|
Operating Income |
$ 66,549 |
$ 65,253 |
$ 147,337 |
$ 147,908 |
||||||||
|
Operating Margin |
29.8% |
31.0% |
27.1% |
28.8% |
||||||||
|
Franchising Margin: |
||||||||||||
|
Franchising Revenues |
$ 95,543 |
$ 90,113 |
$ 237,618 |
$ 225,139 |
||||||||
|
Operating Income |
$ 66,549 |
$ 65,253 |
$ 147,337 |
$ 147,908 |
||||||||
|
SkyTouch Division operating loss |
3,272 |
720 |
8,768 |
2,074 |
||||||||
|
Hotel operations operating income |
(354) |
(305) |
(858) |
(831) |
||||||||
|
Operating Income - Franchising |
$ 69,467 |
$ 65,668 |
$ 155,247 |
$ 149,151 |
||||||||
|
Franchising Margins |
72.7% |
72.9% |
65.3% |
66.2% |
||||||||
|
CALCULATION OF FRANCHISING SELLING, GENERAL AND ADMINISTRATION EXPENSES |
||||||||||||
|
(dollar amounts in thousands) |
||||||||||||
|
Three Months Ended September 30, |
Nine Months Ended September 30, |
|||||||||||
|
2013 |
2012 |
2013 |
2012 |
|||||||||
|
Total Selling, General and Administrative Expenses |
$ 26,982 |
$ 23,170 |
$ 84,078 |
$ 72,073 |
||||||||
|
SkyTouch Division |
(3,189) |
(719) |
(8,590) |
(2,073) |
||||||||
|
Franchising Selling, General and Administration Expenses |
$ 23,793 |
$ 22,451 |
$ 75,488 |
$ 70,000 |
||||||||
|
CALCULATION OF EBITDA |
||||||||||||
|
(dollar amounts in thousands) |
||||||||||||
|
Q3 2013 Actuals |
Q3 2012 Actuals |
Nine Months Ended September 30, 2013 Actuals |
Nine Months Ended September 30, 2012 Actuals |
|||||||||
|
Net income |
$ 41,512 |
$ 44,377 |
$ 85,269 |
$ 96,236 |
||||||||
|
Income taxes |
16,080 |
11,291 |
33,319 |
37,604 |
||||||||
|
Interest expense |
10,757 |
10,166 |
32,334 |
16,823 |
||||||||
|
Interest income |
(676) |
(425) |
(1,979) |
(1,156) |
||||||||
|
Other (gains) and losses |
(703) |
(511) |
(1,266) |
(2,137) |
||||||||
|
Loss on the extinguishment of debt |
- |
526 |
- |
526 |
||||||||
|
Equity in net (income) loss of affiliates |
(421) |
(171) |
(340) |
12 |
||||||||
|
Depreciation and amortization |
2,379 |
1,995 |
7,074 |
5,989 |
||||||||
|
EBITDA |
$ 68,928 |
$ 67,248 |
$ 154,411 |
$ 153,897 |
||||||||
SOURCE Choice Hotels International, Inc.
CONTACT: David White, Senior Vice President, Chief Financial Officer & Treasurer, (301) 592-5117, or Scott Carman, Director, Public Relations, (301) 592-6361
Web Site: http://www.choicehotels.com
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