NORTH BETHESDA, Maryland—Choice Hotels International, Inc. reported its fourth quarter and full-year 2024 results.
- Net income increased 16 percent to $299.7 million for full-year 2024, representing diluted earnings per share (EPS) of $6.20, a 22 percent increase compared to 2023, both of which exceeded the top end of the company’s full-year 2024 guidance.
- Adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) for full-year 2024 increased 12 percent to a company record of $604.1 million and exceeded the top end of the company’s full-year 2024 guidance.
- Adjusted diluted EPS increased 13 percent to $6.88 for full-year 2024, compared to 2023, exceeding the top end of the company’s full-year 2024 guidance.
- Increased net global rooms system size by 3.3 percent, including 4.3 percent growth for domestic upscale, extended stay, and midscale rooms portfolio, compared to Dec. 31, 2023.
- Opened 407 hotels globally, a 21 percent increase for full-year 2024, compared to 2023, which included opening the 515th extended-stay hotel domestically in the fourth quarter.
- Entered into a strategic partnership with Westgate Resorts, which added 21 hotels and 14,471 rooms to our domestic portfolio in fourth quarter 2024, expanding Choice Privileges rewards program members’ access to over 180,000 upscale, upper-upscale, and luxury rooms worldwide.
- Increased domestic revenue per available room (RevPAR) by 4.5 percent for the three months ended Dec. 31, 2024, compared to the same period of 2023
- Repurchased 3.1 million shares of common stock for $382.1 million during full-year 2024, representing 6 percent of the company’s market capitalization at the beginning of 2024.
- Full-year 2025 net income is expected to range between $288 to $300 million; full-year 2025 adjusted EBITDA is expected to range between $625 and $640 million.
“Choice Hotels generated another year of strong results in 2024, exceeding the top end of our earnings guidance and delivering a 4.3 percent year-over-year net increase in our more revenue-intense domestic rooms portfolio, a testament to the success of our growth strategy,” said Patrick Pacious, president and CEO “In 2024, we also successfully relaunched four brands, substantially expanded our partnerships business, significantly increased our international footprint, achieved record organic rewards program growth, and unlocked new value through additional ancillary revenue opportunities. As we enter 2025, we will continue to realize the earnings growth from our past investments, meaningfully expand the scale of our business, and accelerate our growth in the coming years.”
Financial Performance
- Platform and procurement services fees increased 5 percent to $17.7 million for fourth quarter 2024, compared to the same period of 2023.
- Domestic average daily rate (ADR) grew by 3.1 percent and occupancy levels increased by 80 basis points for fourth quarter 2024, compared to the same period of 2023. The domestic extended stay segment achieved RevPAR growth of 5.9 percent for the fourth quarter, compared to the same period of 2023.
- The domestic effective royalty rate increased 7 basis points to 5.06 percent and 6 basis points to 5.09 percent for full-year and fourth quarter 2024, respectively, compared to the same periods of 2023.
System Size and Development
- Domestic net rooms portfolio grew by 3 percent from year-end 2023. Domestic net unit growth accelerated from Sept. 30, 2024, and domestic upscale, extended stay, and midscale units grew by 1.5 percent from year-end 2023.
- Domestic extended stay net rooms portfolio grew by 9.8 percent from year-end 2023, and its pipeline reached nearly 43,000 rooms. Global upscale net rooms portfolio grew by 43.9 percent from year-end 2023, and its pipeline reached nearly 25,000 rooms.
- International net rooms portfolio grew by 4.4 percent from year-end 2023, highlighted by a 58 percent increase in international hotel openings in fourth quarter 2024.
- Global pipeline as of Dec. 31, 2024, was over 97,000 rooms, of which nearly 83,000 rooms were domestic.
Balance Sheet and Liquidity
As of Dec. 31, 2024, the company had a total available liquidity of $699.5 million, including available borrowing capacity and cash and equivalents. The company’s net debt leverage ratio was 2.9 times as of Dec.31, 2024.
During full-year 2024, the company generated cash flows from operating activities of $319.4 million, an 8 percent increase compared to 2023.
Shareholder Returns
During full-year 2024, the company paid cash dividends totaling $55.5 million and repurchased 3.1 million shares of common stock for $382.1 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 Dec. 31, 2024, the company had 3.8 million shares of common stock remaining under the current share repurchase authorization.
