Choice Hotels International (CHH) 7 Nov 222022 Q3 Earnings call transcript

Ladies and gentlemen, thank you for standing by. Welcome to Choice Hotels International's Third Quarter 2022 Earnings Call. At this time, all lines are in a listen-only mode. [Operator Instructions] After today's presentation, there will be an opportunity to ask questions and please also note today's event is being recorded. At this time I would like to turn the conference call over to Allie Summers, Investor Relations Director for Choice Hotels. begin. may you Ma'am,

thank joining and today. you morning us for Good

forward-looking used remind would during or Before risk you results in may and publicly be indicated consult results. we from forward-looking and to the SEC subsequent forward-looking filings assist no These important XX-Q, should about that company you company XX-K undertake other understanding or will speak events today's factors differ predictive company's update we begin, Actual of certain the statements like and the information that its should affecting you we reflect call, as date statements this consider. for statements circumstances. them and those materially to to in conference to you obligation

our Chief our our find Relations press financial at Investor speak our third section. a the to in and of of on as results earnings Officer, third Financial quarter our XXXX can to under and posted and Pat referred website reconciliation our will remarks quarter This is measures Pacious, Dom part performance. Chief our choicehotels.com operating Dragisich, President Executive financial which non-GAAP release morning Officer; You

glad and over will to Following will that, Pat. your we Dom's with Pat turn questions. And remarks, to take call be I the

and Thanks, everyone. good morning Allie,

growth position future leap a third the Our and Radisson the evolution Hotel's quarter results and forward in significant competitive both of business are the Americas acquisition of Choice potential.

locations hotel confirming focusing investments RevPAR our XX segments accretive on consecutive RevPAR of is strategy For that and our outperformed working. our has and industry quarters, growth growth the hotel

upon best-in-class expect delivery Americas full by recurring integration early an the $XX to engine, EBITDA million business brands now XXXX. in and is to of addition growth unit now this enhanced the from future adjusted incremental its in drive we Radisson business our Our

vectors excited will these new provide. are brands We the growth about

adjusted of XXXX, to $XXX and strategic our by grow now report us our year we more results, Our pleased surpass shareholders was quarter, repurchase program invest last operating our shares full a X% over strategy to versus This allowed pre-pandemic by year on hotel share versus return in through in to full third when million outstanding. than first growth to achieve peak. full more to acquisition our record nearly I'm than EBITDA performance. which expect the company remarkable XX% XXXX these that year's became builds we year XXXX XX% results pre-pandemic the and year's representing

in Americas will stronger the Radisson results the to part and Our the Choice. than years of franchisee that Americas the of impressive opens are a demonstrate and off developers, guests for ever months Thanks expect integration growth I'm energized Radisson for know acquisition to better drivers community, and over our demonstrates position brands opportunities for additional further to more strategy level have complements from that to we as getting about future with after capitalize franchise existing alike. continues than on our This The in growth. will and And prospects upside come. acquiring opportunities enthusiasm remarkable. acquisition we how owners that outsized and incremental Americas additional meeting Radisson two be to owners growth for around the ever we the significant our since long-term shareholders to a outlook value first and clearly continue efforts unlocked pay the half Americas, fuel Radisson

growth. in instrumental hard by I sequential work this both was Finally, top-line Choice in Americas Adding acknowledge optimism our the fueled our Radisson thank RevPAR teams quarter-over-quarter and strong want to transaction whose home. acceleration to bringing is and growth

Americas of our the Radisson impact acquisition. performance RevPAR data of that provide we purposes comparative remarks, the now the For throughout excludes remainder will

consecutive this Including RevPAR this year RevPAR growth fourth The we quarter. increasing same for the to of which from momentum third RevPAR surpassed to the gains XXXX XX the XXXX XX.X% continue expect At drive into again time, same quarter XXXX, levels marked with by we index to approximately October quarter and continue our XX%, months. now RevPAR our exceeded we results, domestic for growth competitors. RevPAR as quarter XXXX have levels strongest compared outpacing our

and of to the have We levels of for position have increase made investments us surpassing the share strategic because XXXX to been we travel year past demand. a and decisions further half our

current fuel to and rather like leverage new to in our locations, to return our not of levels. drive asset levels, to growth performance the simply to RevPAR and on XXXX was goal and our performance but investments long-term Our future segments business capitalize to strength our accretive

strength the on the leisure maximize throughout favor confident well growth quarter in are we travel have built behavior will changes business third that future. that brands and are and the that opportunities We enable to our us into observing

and As been are highlighting in and significant reap travel uptick been industry on benefits trends prior we've driving investments that them. we've making consumer from deliberate discussed our a the long-term demand to calls, the

that XRs: on of our wages we remote manufacturing. of which brands now We pandemic American Specifically, retirements, has road the reassuring capitalizing fundamentals we and and that know accelerated long-term each favors call trends, rising work, these locations. are the trips,

in business for coming these an trends see travel our believe prioritize to continue growth. strong our company's way to to demand our travel, outsized We segments. from long-term additional continue consumers benefit as As will we tailwinds

model expanding has resilient and returns economic stable contracting delivered business throughout cycles. historically both Choice's Importantly,

in sequential bookings. is we optimism our business quarter-over-quarter the third our ahead, of increases Looking transient strengthening segments. travel travel reinforced by business group quarter, and the our further drove In

our the Tuesday occupancy strength mix in our continued historical stays XX% travel and guest Wednesday travel, to travel. approach third levels year-over-year of of in to illustrating accounted September for was of leisure quarter. approximately returning weekdays robust component growth Furthermore, on continues and the during the business addition business In strongest

infrastructure tailwinds and anticipate in presence additional such additional significant from onshoring by the sectors bill. healthcare, supply more of expect professional We Radisson segments context fueled and services, chain the RevPAR the as accretive key we business especially investments industry in increase travelers growing verticals Likewise, the technology and from our travel in in our and Americas US to locations. of the business acquisition nationwide

quarter have in results the impact acquisition. will I decisions provide the brief that third capabilities we our Radisson portfolio, our a franchisee the on demonstrate investments made segments, paying proposition, Americas value platform key brand are off. Our strategic deliberate and of other excluding tools and now update

brand's same strengthen mid-scale brand First, compared has quarter generated now to Comfort daily brands. of growth XXXX. brand The refresh core in awarded of continued index with hotel rate in agreements and unit consumer developers occupancy the XX developer year-over-year confidence portfolio this its third quarters our registered of franchise demand attractiveness we and and to average segment since continue versus increase gains of its local in has continued This guests strong iconic a the drive successful XX% alike. the performance our competitors. the straight The period to product underlies to updated

new now next chapter under in several and Comfort prototype flagship Our development for brand. locations is our marks the

also our significant growth. to stay which RevPAR continues growth invested of unit segment, We in extended and driver be a further the

expanded to Specifically quarter, stay domestic year-over-year. XXX nearly XX% third increase in the extended pipeline a hotels, our

This first fueling to traction our is major grand nation largest pipeline, additional developers from of the brand's celebrated development projects community Suites XX cusp mid-scale Everhome our build Suites its brand in stay for growth, hotels. recently offering gaining its stay one extended optimism commitment on the extended newest already the with of the opening a new trajectory. expectations, stay the than the Everhome and hotel across initial Our construction the exceeded extended impressive in recent XX including performance of more

as expect to last for number higher we brand's substantially addition, domestic a year. contracts In of compared XXXX

same rate. and at five Suites the RevPAR very than expect to units to of third nearly increase number by years. XXXX increases us in WoodSpring our we in extended compared both extended brand's XX% segment of XX% achieve annual capabilities optimistic in growth Overall, and investments distribution over of period quarter stay marketing driven and growth to occupancy average XXXX, of more the of an next about the the the Our growth stay our remain rate enabled

pipeline, of the portfolio versus same At by the growth pleased outperformed we number one end having additional an We as domestic agreements time, is developer are RevPAR than enthusiastically franchise of executed its same community XX designed also the introduced years brand are of secondary brands for in our XXXX. which one recently the has third by Cambria as of end The the properties active more with construction third threefold. signed projects XX points Hotel the in The new and prototype received where XX quarter. third upscale increased percentage XX nearly The agreements over with brand of the ever. quarter September. over our best X% under the by of by period over of been upscale leisure of the units segment's the reaching Cambria markets year-over-year grew with

and the recognized responses in magazine. initiatives In been one expand of and All female-friendly our world's fostering accomplished the supportive and the of the time and Americas the been the on brands in commitment our addition, among organization Choice's many of Choice the These upscale large the certainly associates meaningful to continues on diversity to us the to recently this build diversity, company rooms of as companies to at across inclusion. We focus Entrepreneur pleased hotel diversity we've over commitment our part footprint Radisson franchisees. segment, I'm franchise by momentum as make only an the awards not our environment are list, ESG will one XX,XXX speaks I'm inclusion is hotel of us opportunity upscale have addition XXXX. further proud in we portfolio. strength are the top the central the the quarter Forbes brand recognized report of undertake growth of in share that brands, companies hotels and have award-winning particularly recently done our the equitable The efforts Americas as the Collection without segment and expect best to which dedicated fuel also Cambria was that of by they and our employers the to we culture. end same in based acquisition could were to allowing from enable increased world's for equity, Radisson the to to global top industry. our Radisson quarter. of accelerating third that A to the upscale to Ascend our Hotel entire

part achieved for to of this underrepresented relationships opportunities of to growth Specifically, contracts enable franchise XXX of XX dedicated awarded our earnings our of scale, hotels Dom? drive years will and team and best-in-class commitment continues these over for and do We CFO, on by and closing, ownership year our network confident to to that investments among power success increased our Americas over to the the and well us as In women with and since will franchised our to With franchisees’ hand We of and accelerate the Choice this integrate continue fully owners began I'm that over owner profitability owners, service Choice’s continuing the and that, quarter value development it and are diverse I digital remainder and to beyond. positioned franchise and ago. minority further franchise program capitalize will to we create forward results platforms. our deliver Choice strategic effective, to leveraging growth believe Radisson family brands shareholders. look the

good and report be to financial pleased with to today quarter everyone. performance. very Pat, Thanks our third I'm morning you

Radisson are from the rate effective figures not franchise on capital remarks balance additional provide you while like the financial XX the would August insights royalty I portfolio include our that share from for our our Americas’ quarter and unit close pipeline and lies third and RevPAR expectations agreements impacts allocation acquisition. to performance, will on and Throughout our transaction results, growth my I date, what note sheet results, Specifically, ahead. inclusive approach, today, update do of figures

period quarter increase. third a revenues to million, compared the the of XX% $XXX.X were XXXX XXXX same For total

grew From And performance, driven royalty effective million, rate EBITDA the to contributed August third adjusted adjusted our platform a share impressive portfolio end Our third revenues. to by result, in revenues our $X.XX adjusted for to the I'd growth $XXX.X quarter. our and earnings continued contribution of $X.X levers, million as RevPAR other with were per $XX.X like XX revenue key million total the and beginning Americas through the in Radisson turn quarter, RevPAR. EBITDA. from now three

by the XX.X% daily third rate our for of RevPAR the to XX.X% growing quarter compared quarter XXXX. increased average Our domestic with same

of and XXXX. in the acceleration quarter growth the this compared Our an achieved gains second rate RevPAR also year represents to of

for revenue their optimize effectively rate remainder revenue our to critical be quickly in to environment. reach right award-winning us from the strategic the coupled we have beyond. of to by owners value and that the and RevPAR customers, the outperform enhancements expect performance accelerate execute to capabilities points quarter further growth key allow strategy RevPAR tool continues advice to to our this We our XXXX franchise third with continue addition, new for from investments growth will and The quarter our which capability, In management and we allows our enabled expert in over us occupancy This management fourth the segments results. in consultants, percentage the quarter. four proposition the third believe to industry made inflationary our target for pricing

RevPAR optimism, XX% ends and growth represents we Given raising versus the and year top the XX% which as of initiatives year compared RevPAR full growth increase XX% full strategic both strong expect XXXX. continued now to to ongoing and XXXX our range XXXX, forecasted and trends, between domestic XX% are RevPAR bottom to our

continues rate of be also significant source Our our growth. effective a to royalty revenue

year-to-date seek long-term brands. royalty effective the performance quarter, capabilities and our rate, points consistently total to investment for quarter both for of on our behalf third exceeded Our Choice’s increasing cost continue through return of line revenues the of strategy domestic strong deliver value strengthening basis further once to franchisees, top proven our investment and owners proven to continued X% again Owners maximize our that ownership. a proposition validates This year-over-year. on while September the our franchise reducing attractiveness of five

to in year full we year-over-year. For to the grow mid-single effective royalty digits XXXX, expect continue our rate

absolute and lever revenue revenue size is the to growth, of are advantages. where third unit portfolio’s our The hotels intensity like discuss I'd our key

accelerate segments which increase to been outsized has room growth in accretive ultimately goal in RevPAR an royalties. strategic Our results and markets, in

of generate rooms In our trajectory. the room pipeline as of next to on in quarter unit average every Choice’s, in entering approximately Americas XX,XXX unit development higher revenue the fact, new Radisson open currently continued marks the it. has third or The chapter growth twice as a addition portfolio the leaving of end the revenue per domestic

discussed the and grew acquisition third year-over-year, quarter, including from domestic by one our our size exits time the For portfolio. X.X% America's system both Radison the previously

cash from $XX approximately in the this the Suites cash unit impacted removal associated an years overall This exit properties portfolio. more exit will WoodSpring reported resulted Furthermore, than growth, increase been the fees of which royalty than results. the a Although million, this revenue triggered offset with $XX more benefit. five this benefit has EBITDA our of million excluded in our adjusted of one-time

to Importantly, levels. nearly this Suites’ year not as WoodSpring reaching by openings also exceed significantly expanded year-over-year expect only has the September, the of XX% the XXX pipeline projects, but we end domestic brand’s of XXXX

by X%, XXXX the Suites XXXX both Americas our expect the we size seen overall of our over domestic XXX quarter value acquisition third at domestic and exit domestic one our that hotels. the boost Radisson excluding broader year proposition and domestic revenue continue hotels improve long-term domestic XXXX their hotels. expect as XX% to quarter-over-quarter incremental X% increased strong approximately versus competition end. end. value Even the they I full to year-over-year operations grow the XX% and Americas and system to and seek our Furthermore, third increased their intensity our portfolio quarter the am including hotels, RevPAR WoodSpring we pleased quarter-over-quarter time For choose to to year-over-year performance at our Aided continue. XX% report trends hotels the brands Radisson pipeline developers of exceeding of in reaching pipeline by

representing than for new quarter, Most period we In construction increase Two of a quarter agreements domestic addition, more XX% agreements the sold the conversion year-over-year open third franchise are same hotels our were awarded. expected of in these prior in hotels quickly in of projects. importantly, versus to reported the thirds the XX% increase the year. an new

Our developers about are of term increasingly lodging long the fundamentals the optimistic industry.

momentum to completion are the applications for in in through one to September, reasons one new turn growth agreements sheet, franchise than increase of confidence very for major over strong year Radison franchise even recently continued acquisition construction domestic allocation over we the of performance XX% to were share new has stronger quarter stronger balance further with of executed Even prospects and the the impressive growth drive today resources liquidity I and by the that even top prospects total pleased and they now of third to are after of recent the third line year-over-year why believe rest America's the during effective domestic our see for our demand XX% the the outperformance of our quarter and repurchases, significant September year-over-year, our for in like strength the our our Specifically, beyond. increased year-to-date for we a position. brands agreements our pre-pandemic. reinforces ensured

In our dividends repurchase and made also by $XXX fact, on million am report well end I of have the continued a Year-to-date of maintain Board the in $XXX and optimism we balance our recycling the business times approved to ongoing as our of for to we came our by These the strategic four recently of with returns million to initiatives, confidence leverage driven pleased quarter. an Reflecting over to share five continue outlook, ratio cash that shares. $XX debt targeted Directors times to sheet capital EBITDA the our low three shareholders. X.X our in end of form back share of progress range of performance, gross strategy. executing million below best-in-class we authorization returned in a third impressive purchases. increase September, in approximately million through the

of own XXX agreement of sold an Cambria additional with also Most the our asset July in XX-year in secured importantly, we sale the one franchise assets million. another Following recycling XXXX, we June, a buyer.

Following of by the The the period we Cambria over third hotels owned of development reduced quarter million during strategic company's of the adjusted the Cambria of $XXX year. sale closing transaction, projects in this to assets prior have compared investments from these million XXXX. prior EBITDA $X.X recycled same will

and flows and grow make to business excess well cash position strong the strategic Our the return cash to shareholders debt continue well us to investments, capacity into future.

plan pillars to all strategy. forward, we Moving use to continue allocation our of capital

Before up questions to for to opening lies what like turn expectations it ahead. I'd our for

We acquisition XX% year XXXX and growth EBITDA to compared to and full full million compared between full to through $XX to $XXX the Americas’ $XXX of year contribution since unit adjusted XX% to outlook year representing XXXX XX% adjusted the million, growth range $XX includes expect to This XX% million million adjusted XXXX. end year. the the of EBITDA Radisson EBITDA from business

of RevPAR upper year upscale our full in adjusted acquisition, XXXX EBITDA XXXX increased margin. Americas these generate more the Additionally, intend segments. two to recurring million the extended to in in great continue with integration these from full we We XXXX expect exceed investments our to the growth we underlining and value stay higher its full year expect adjusted impact adjusted midscale, companies. the and Even core accretive, midscale, upon across from combining Radisson value-added Radisson $XX early EBITDA in margin Americas the EBITDA sectors excluding to invest

be are will during We confident with strategy to our We long-term deliver strong Choice. of approach accomplishments strategic updates growth us growth you we advance in generate next Americas strong to creation I us allow to we closing, strategy time, returns operating through At forward Combined continue discipline cash strengths and that sheet, to remain value the and further will believe have on allocation Operator? outsized look bring In of this and capitalize achieved February earnings capital to Radisson ahead. to our to and we providing would opportunities years any questions. expect resilient the Pat happy in enable drive we our model and are to business balance answer levers. further with results about substantial levels proud multiple the these our excited call. and long-term

your our first Instructions] America. from And Please from with ahead comes today question Bank [Operator of question. go Kelly Shaun

Hi, everyone. October’s mentioned to obviously RevPAR good strong off wanted with morning start. you to you or Pat, start Dom a the outlook

is from little you we’re XQ will Can for third of accelerate better about outlook things may the what we peak number just and hotel thought more a bend, little than moving bit Your there? heavy quarter. the seasonality a kind into drivers not talk the of actually that a specifically That’s with be other leisure across probably seeing the you chains, here. would’ve bit

that’s what’s of driver the that up push kind So going that to quarter-on-quarter?

saw at traditionally think and about able saw year, travel we’ve long-term these traveler of time And it’s consumers our year Thursday you in that we for in trips the that of are in are time we’re and I in And end of September, year remarks R’s we the we saw retirement, I those night all whole, is Sunday week of last a I – post-pandemic, going expected business coming able that the you five in And American We Wednesday the time and saw sort back believe really really rising of are time industry slowdown fundamentally When you and partially saw We articles. of these not quite work, trends quarter. for as which to And due these that look that so travel. behaviors the the to quarter-over-quarter. as things quarter year Shaun, half – anymore. mentioned provide October. and calls talking business of night keep reassuring Yes, things we’re believe to some back at occupancy are that significant QX week fundamentals of are When now it’s into the about, of travel. in wages, a the are look Tuesday of we driving people business. going the then QX changing something kind road occupancy travel that third QX tailwind been for the return mentioned, pickup. our at is our changing my and business. it these to talking that QX. time to remote seeing that are And manufacturing, gains

Super, sort Pat. little brands follow thanks. be outlook, parameters are we Radison, you churn around those should we Thanks, this going NUG that and some And a back move think XXXX up we of to continue to, how be core dispositions its Can as expect Is then out as would looking this specific undertaking some XXXX? of to and WoodSpring we on end? of should into Or obviously, meet I some initiative some or continue move you’re across start into refine the the out my you those out if and put a us bit. portfolio that, refinements help here material that beyond?

long-term to Yes, reposition company, I in see brand our it’s we to the really that issue. think Shaun, the strategy segments expect reflective the building of growth. long-term It’s

system mentioned go look we’re the as from our that investor by time. XX% twice if at revenue of the delivering was X%. everything if his you hotel system in and But remarks, back So revenue, increased Radison the in unit that XXXX, you is growth Choice the that’s lifetime at every Don bringing RevPAR like-to-like, than higher deck remember

And midscale and exact quarter, can segments. to segment beyond. what stay experience reflection that move of we you’re we’re of extended three fill So Don those we a of shift kind into upscale, XXXX and in particular, our of in right, a into the it it’s in on shift as more numbers is going but the did upper kind

Shaun. Yes,

And guide so with exits. unit include the WoodSpring you does overall the around years, it, that put growth year-over-year, associated XXX our about terminations when some numbers the for X%

Now, QX. that an also QX acceleration would from imply into

particular, revenue point it’s impacts to here that the QX expecting So, of fourth one-time unpackage, your of any percentage some you see NUG the of take intense the a quarter. positive. pick you the unit acquisition, a growth about impacts, a one-time in impact terms, look the and When we’re the one-time in up both of without half

growing unit so that that NUG you from also growth to apples-to-apples at intense basically And talked we quarter fourth well. is of churn heading actually you’re economy before It’s same lot is accelerate points coming a about expected segment. a take XX into broader That from the segments basis the that look revenue as when

So, we’re be about in quarter. that to obviously growth be expecting XX intense expected is revenue the percentage the growth the intense revenue outpaced for unit that points To year, basis full unit fourth point. one

gives obviously very now what think I last us the two optimism, seen growth further that over we’ve is the strong pipeline quarters.

house. outlook optimistic about the the we’re NUG So, pretty of side on the long-term

Thank you very much.

you. Thank

next Our comes from Wells from ahead question Dori Kesten go Fargo. Please with your question.

and could the be your just that XXXX XXXX? through Good the XXXX on swinging reconcile said context provide there key to reasonably your regard Radison comment for in or some Can walk EBITDA couldn’t you you behind you morning. Thanks. assumptions that results

we was company. the hotel for you portfolio a if larger look announced an we was when on think this I it XXX sitting infrastructure built much that we that Yes, bought, business at mentioned deal, was the that a and

infrastructure is to here opportunity the begun of remove significant a So we’ve cost, amount that to which already do.

the what in suites is, that was, its country and a take double look comfort The a when just part it compare its contribution legacy in country the brand. comfort at, a for in contribution suites, a half. think a in exciting OTA Choice was was and you loyalty moving say let’s I forward to

higher they’re customer. loyalty OTA that guest generally sensitive a So that pays rated program a, they’re more member price and

the So, the bringing integration platform Choice when think completed the when contracts coming onto we year about in new here. those is

see be pulling we’re at there’s that out boost that lot revenue significant business. a also of And think obviously we those costs the to level, We expect from corporate hotels. going coming the duplicative of a to

Yes, is I the of would, million that, and what vast a put some then just fee $XX you that, that the when look still to Dori, business. take numbers majority at that around

have course, what that came so of Obviously that’s when million the candidly, those When to When some expected. streams Obviously look but don’t puts granular, revenue million. now community at, disclosing certainly disclaimer expecting do the of million [indiscernible] business, figures. really this revenue not at fee with value has from language the take and and the additional we’re and a optimistic you of you a $XX our three business, million is providing into the to provide drivers take that about we the is in some net well. outperformance future. vast fee pretty several much elements that accounting a essentially $XX takes look a look take that some you at point the that million. benefits that that, $XX comes with we purchase The of We the a has so as But what we’re over some of that I than $XX we’ve back income at guidance additional very value the investment And some the synergies is unlock And shared found we’re owned it amortization. want again, acquisition be platform unlock the the about can numbers. million, are next $XX putting see you being right do lot of We’ll high the to look upside depreciation as when and business. with which stronger to the to exceeding more with value. of assets, we specific would continue it of them the majority argue A around, you synergy on take the a on to the margin pass and acquisition. previously higher that expected because Obviously quarters. couple a synergy associated about quarters around figure ago, $XX than XXXX, figures, just guidance much some

you when to the own any And about you think expect brands, your to capital way? Radison Okay. have Americas growing commit in do that to

it Inn Country brand Radison brand for upscale the opportunities At with outsize this There Suites that may don’t. additional capital part don’t that, give the time. we the largest over needing see see we we & some unit to that additional thought count acquired we see What capital. limited But point, are requirements are grow their this don’t brands, to the we Dori, as their in two at some more our brands. that those we as full-service really any and brands of point

Okay, thank you.

next Please with ahead go comes Bellisario Baird. from Our question question. from Michael your

morning Good Thanks. everyone.

morning. Good

the property Can one you’ve and talk follow sort what’s the and more deal have the deletions the rooms up you to Just of then coming for within Maybe on the months the why portfolio quarters? near-term outlook Radison. in announced deleted that exit first June? the in about were occurred more since system maybe

when the unit existing the already were we going in the Mike, underwriting, that count were through transitioning in out. there Yes, diligence, hotels were

we were So, aware of that.

was I number think that the seven…

was total. in It seven

Seven in total hotels.

owners and were up the their hands on have So, change that as That’s XXX sort what, owners either. weren’t we the – were aware And these coming an aware hotels, make that these exit. to of ownership have going outs about to are – that. of was you’re to decided hotels normal

owners think, back mode. we expect future the and the do at brands, we’ve we we a these get heard do brands existing look that we the investors both and So, and portfolio and to into existing from these significant optimism growth have

Choice Dom, modeling breakdown step on SG&A during the the there, up then costs? quarter, Got for it. versus question just the legacy maybe how much you can Radison And was

really the so of I’d or result about, speaking, business. of broadly a say Yes, core basis is points the XXX margin

And look is onetime of return our costs, some a obviously certain you that convention this of came back when at so year. so take timing, the

a so of saw or We when there. way some is there lot Radisson the about some during and quarter Some would last expenses, noisy quarter, quarter It's added debt timing of QX, and cost year obviously $X.X in $XXX,XXX Michael, obviously then The acquisition. bad last at three, this, certain or compare the third about it's with one-time NUG the of so reversals some delta year-over-year associated [ph] a into should like of you cost cost spilled million I it's I return whatnot. that an quarter, look say.

up XX% look when from about take it we're is You a to to you full-year EBIT perspective, guiding to at and basis want your full-year a what at a XX%. on look

still your XX% that's punch-line EBIT benefit Radisson, is you think the year-over-year. the added I there. organically remove XX% Even up of to if

very invest going long-term we've growth like continue much for past. the to to we're So business optimistic. We're this in done in

Helpful, on particularly then just own and Okay. last legacy one me portfolio, from side. on the the

ownership the you. maybe be properties recently of of what's the on you of taken more just the Thank properties to would franchisee sort take back health and the a side there helpful? where outlook some Cambria done for lender-on, You've you've

side We any year. some XX-year on this we've one every with capital franchise franchisee of properties in of know. recycling quarter of we're significant to the recycled single future those you've don't capital actually the very assets. excited on anticipate house, Obviously about the Every that seen you of agreements ownership XX taking the

are QX. in and so $X.X the capital, of impact while an EBITDA, probably million like perspective obviously But terms assets expecting to – modeling long-term owned prepared $X strategic I quarter or strategic we're the that's obviously my place. in on So in million mentioned recycling from that's agreements initiative having those remarks, – significant franchise those in a in selling putting the lose a

you. Thank

you. Thank

David Our next your from Jefferies. go question with question. comes Please from ahead Katz

morning gentlemen. Good are you? How

you? are how Well, Good.

Hello David.

those to talk intensity degree rather evidence points making to So scale we – a who of sort the of with lower $XXX investors which hoping the you been customers revenue What was coming or or from logic I than RevPAR out regularly historically the could the somewhat occasionally, or understanding looking Choice, looking around any periodically are for is about around debate the up that progression of and that's that? you're the traction perspective than data traction core, getting hotels. there sort

fascinating Yes. Tennessee like we're brand, Dave, we're Valley you our rates? Napa Cambria driving $XXX in we've it's to and you say, what to and at night. owners a and places look they talked some look cases when drive What's can us is in as interesting really driving Nashville, upscale Radisson the places like

the Choice that's – coming So platform. and from

So in both in deliver We've whole also new growth Cambria the developers our [ph] customer? the significant we question, are RevPAR the that Upscale Choice six sold. is seeing and crusted corporate this proven guest, new growth; account five, a in which the building ago, Upscale Cambria new way of one we're this believe can cements our today. the Brands having regard upscale upscale of significant of its I who by years that in contracts best that rooms, with ever stays really acquisition which brings On Radisson another that brings in that adding top segment. Upscale upscale amount Hotels, in that position to probably years

Service several ago. to we at it's and surpassed the accelerate presence at the look segment. So at Select the years Radisson we're really look when in rate the going of momentum that when Cambria, versus in remarks in company have achievement that our Cambria's about talked we as driving I look forward Upscale's that Upscale I And we're doing that what going the that outperformance type acquisition that's segment that an we

continued well. XXXX the that have Upscale what in segment, Obviously showing When you percentage we're the it's versus up quarter as performance compare sequentially it's We a at broader in higher driving well. industry. two. XX.X% look over XX and industry you XX% David, levels. about only were figures against Yes, up seeing than improvements we the the as take When points

show we're it's specific obviously right we're good in revenue that mid-sale at the story the time. as intensity locations as about in right taking segment, scale segment. that we're but segment the same very upscale product in the core that the just So well, feeling seeing isn't up And share an that

Got it. you very Thank much.

Thank you.

from with Please your Our ahead go next question UBS. from comes Robin Farley question.

Great, thanks.

your talked even it that just one-time about was you there? but growth, And intense curious it's sequentially. enforcing prune that a at looks of and intentionally excluding big just segments, economy what's some just you a I Just it unit those owners clarify of economy know of Are good a that dynamic I WoodSpring but to happening in could need wonder intentionally loyalty driving good was are if change, kind I it's that of economy there environment environment to out? finding the moving I'm the like that, more and down organic they that. of kind you a revenue circling little know demand you've slightly a such because like segment back about of if standards brand to bit from sort looking is some help Or which don't maybe they're sort program travel the environment, units just leaving? extra Thanks. I'm is so, any feel wondering travel

the only Well, which has of platform. number I go guess itself the highest in on segment to extended I what state WoodSpring, back our really that's brand The brand, growth think that economy growth economy I we'll a segment and segment, or been about times we've brand the the is should talked an shrinking. say is

on we of that a significant in RevPAR segment. they our and and both growth consumer that unit So driver feeding are focused are

economy the to actually taken of and And positioned we've segments But a growth mid-scale. that, have advantage And seen overall strategy Service growing so shrink. and those two our seen extended hotels is the pandemic segments out pandemic, is forms What transient as that that or use, transient brands sector in well. that of And then And they for shelter growing. segment lot is that owners are some to I say non-hotel be during other and economy that. we in about consumer is Select do quality the exit just continued repurposed factor those say, and is we've then that post more the continue not will particularly our are of got are Upper a another in trends. churn got less Upscale for So stated seeing and we've for hotels positioned that system you're are the it's to trend up the today as of so are it's to well. growth, significant all being you that's our four highest levels. for hotels so that and in brands undergoing we've and that going sector great great brand maintain sector about to, economy would is the in environment are done what of in if as which

as That's Okay. my And follow-up. helpful. Thanks. just

for expectation sort your for – – that a the OTA early to is brand it Radisson, of that XXXX that, then Or OTA of agreements? it the agreements be matter expire hitting Choice going the Or XX it to had synergies, of it at sounds the waiting is looking of XX for the number six IT will months moved take that months take they it's to the the with gating the Just acquisition, what's and which after XX programs after to what's versus you'll to but months those? months get like more to ones the it, between loyalty your of combined? sort issues work sort get

the paid. – make so that that Sure. I are them sure check Day had we had X, are in getting check guests we sure the out. to we make and mean, to in could people We acquired

integration. systems technology that So of be to we with are happen. two the would running today completed make half second to the We by next year still expect

large you're business remarkably single system, long other at single that provider center loyalty I to website, we're a we're short And acquisitions, all do that the is amount today do on integration. What's when investments bring of it's exciting delivery engine a of So then call single a making teams done to and using the taken you're that, the reservation working and programs Radisson a together look that really this once bring how we in that you've time on this to to have going before Brand. this in system. the doing increases the were doing that is is what were to Choice, put increases brands great. contribution we to already – everything for we all isn't doing great the there and inclusive those I drive, is, they on we website so even what platform And and get forward second at of than were going they better be some would future are that what going doing The combined the some really their were are RevPAR state expect to to platform. proprietary going things thing them Choice

is to the forward. I half look at next overall second of the that for And million, when time value be think all I our by proposition franchisees really bump we going of that into that's our RevPAR So get another point, shareholders. year exciting to get beyond as the being $XX and prospect the the our to for company so from is hotels the XXXX driven we growth pretty for those that's into and accelerate opportunity the starting and really a

you. Thank great. Okay,

Truist next Please Securities. Scholes our go And question. comes from question with from Patrick ahead your

Hi, good morning everyone.

Patrick. Hey,

you RevPAR able – what And Couple us questions. also a that that to I'll in have then Radisson? you. And Are guide, if much include questions assumed were give are morning. that? that year to us question. Good then follow-up Radisson in you. growth full Thank be would you to full here of Couple for tell able for How year is of EBITDA you guide?

EBITDA. Yes. is year question XX about Patrick, associated Tying XXXX, million that optimistic it why well, $XX million the previous full is plus million so as to about guide with that in the the adjusted back sub-period. this Radisson for we're just includes extremely $XX

year, in environment of end organic due RevPAR the obviously would more $XX higher really million, XXXX, for RevPAR time at up higher. Choice’s RevPAR the from RevPAR. us. XX% through a our Radisson When has the be even done The to acquisition expect to this actually you great look close integration generate than we we team the that's a take was acquisition normalized the So mid-August the work on that

wise So report a basis. that comparability it felt to purposes, was on to business continue just core that just for we

continued expect the look Choice’s it has to with to Now industry associated going year-over-year business basis the return forward, business. outpace at outpace on travel. and a when tailwinds to we RevPAR continued you also the see Obviously, Radisson

expect we that tailwind RevPAR forward, as going So well. our a to for be

as would repurchases, Okay. historically or share you Thank been Choice at it you. more fairly quarter? being lumpy with sort it; would of a thing sort values do per take think this has Thank a forward? of and dollar Or quarter-to-quarter And say you. consistent forward spent share going going repurchases, activity quarter-to-quarter see year-to-year activity the consistent then of do the you I you on

a amount talked from of third I the is value we dislocated, do strategy core internally, our invested back stock. strategic is be. that overall bought the about but mean, quarter I the to acquisition. our we And all stock says, made believe what Yes, we’ve of want levers. valuation the capital dislocated when pulled it’s the allocation very think business, we we significant a the We interesting we when in to actual strategy believe a one, We actually always from

of year did So think, double than we dividends I prior we back, pay this amount in and the the year.

keeping while, levels all So mentioned actually the in his Dom target, as leverage below our remark.

share the a similar shareholders. a repurchases for opportunity probably the And growth fact So we’ve the up of what as we to it that’s the future if forward sits what on do of, lumpy executed past. is expectation in the on is versus the we kind shows strategy will stock going believe our where timeline, of

for color on I’m that. the set. all Thank Okay. you

Thank you.

go And ahead our Please next with question comes from Joe your question. Greff from JPMorgan.

RevPAR of forma pro in Good morning. the weighted is delta? core average relative and in share you average percentage your pipeline your us accretive absolute to what are rooms What RevPAR RevPAR geographies development segments premium performance? with that Can

perspective, off the just composition level when numbers at of can don’t from high if the composition I geography but pipeline, know you under me, XX% hand that the have provide is those Joe. of pipeline of Let we just a I extended-stay. the look

we We’ve of higher cetera. would et just under larger sitting sitting counts, the consider occupancies, a got of room upscale, is pipeline in environment, much XX% is about RevPAR midscale. in accretive extended-stay, obviously about So XX% it and

in of perspective, our of economy that’s obviously. about the our is segments. at look XX sitting top pipeline X% just markets, markets, lower geography in a got So we’ve top RevPAR the, XX taking XX% From those a those pipeline

RevPAR core prior, location, be within, strategy street that core, even most really Our product. within midscale; accretive accretive, that corner is even is like here the to RevPAR said I a the most goal the

as perspective and both you perspective a at macro can a see the pipeline the that hotel composition in very level. of about from So feeling micro good

me. RevPAR you. are then conversions seeing segments And and generally you. thank you Great, all accretive, that’s for are seeing And which most activity? the anticipate Thank conversion

Collection where Yes, I the we when that the would those then as our I Radisson’s RevPAR midscale just a brands upper brands. do Ascend accretive of pips move strategic into And you and expect you get comfort you with portfolio conversion location. that’s upper the unit and growth a think down as this at from most a country the of lot it, upscale said for in look Dom will isn’t particularly be brand, it’s midscale, and today

quality system market one well. that’s also that into of higher a in pulling our in part as leaving is our than sitting is So, RevPAR a strategy

but segment the, from bringing perspective, So getting with in a it you’re really we’re both from what location. also a

Thank you.

you. Thank

You’re welcome.

comes And from your from our Dan Wasiolek with next go question question. Please Morningstar. ahead

guys. taking I if too, my questions morning good Hey, for Thanks may.

mix to excuse in of along room quantification then of give some a back question maybe that’s maybe of leisure debt with if Radisson onetime maybe as wondering the provided a could you bad Thanks. and just might And as nights, kind Radisson you give far cost, quarter additional onetime some me. as And that, SG&A second with cost percent me, wondering be and that. a room mentioned there for also where So and on Radisson the going you if some it reversal, a you mentioned like the, versus the information might was the if RevPAR business, XXXX. just

business. so business. been Radisson XX% XX% Historically Yes, has the sure. XX% leisure, Dan, Choice XX% brand system was leisure,

nice business that additional mix we’d on it’s up. So be a the picking travelers

when obviously when Radisson basis, accretive look by just XX%, up RevPAR percentage apples-to-apples then portfolio year-to-date, take look on XXXX at an I points two about percentage over the, pure is versus a And points. levels, at, up about it’s mentioned, you versus whole XXXX RevPAR a the little you the three performance,

platform. broader, that the what that, revenue on that on future. the side you’re So at believe in business we be again, strength when see growth We expect to the to tailwinds synergies to our that we just our seeing the this an travel when we’re looking platform, we both of the goes acceleration in believe them quarter-over-quarter, RevPAR of the put back

for kind about was talked Now, the that, reversals, bad $X onetime for costs coming with costs the or million to we these associated call just million, quantification business. your that some of about million the into so, of back those quarter. returning costs of debt $XXX,XXX apples-to-apples, about under onetime T&E onetime let’s year-over-year with was it it then quarter the three, convention other that associated $X costs The and $X are

Thank Okay. Very helpful. you.

you. Thank

[Operator Instructions] JPMorgan. Our Montour next go question comes Brandt with question. from from your Please ahead

my Hey, taking good Thanks for questions. morning everybody.

what I that want what, of something So excluding I quarter-over-quarter I’m could unit part like sold. higher just, that to credit just, early you higher mentioned adjust Hotel need see RevPAR upscale sure intensity segments. circle just but to those for in sure, we quarter, the was growth Q&A, and the you midscale copying make want there wrong there’s cited see on upper Cambria intent, the I to maybe net basis We And I going in you to little focusing what acceleration bit heard of back on make a two this what segments. just segments, that. we excluding also churn to Radisson, an think and the and if else a, in the to on a we’re those you apples-to-apples, in

in So the you look XX a net for quarter at about year-over-year a was yes, exhibit, of unit look decline legacy when take points. the the three you growth basis Choice total brand, if

When economy Econo Lodge in you Now churn between that, was segment. the shrunk primary particular, blended Rodeway in X% X.X%. at look the those driver by and of and that

we’re of coming that So call of continue two lowest vast when XX% seeing most is of the certain some midscale, average Obviously is churn is, churn historical entire obviously of still news is company kind lower we it from this of for at those the we’re the year, churn. the strategically you our to the X%, segments. good in evaluate. look the, brands about majority which churn the The elected expecting Choice

intense essentially the way advantage sure needs we’re at window is to taking the up us performing making revenue look basis that unit When the and you it XX points. it’s about of that growth, product be. specifically So

we an QX. see of So acceleration from extended-stay. that’s And upscale midscale, QX do to midscale, inclusive upper into expect

So full we’re guiding to unit of intense revenue about one percentage growth. point year-over-year year

the, the segment, past economy intense segments. you’ve will churn we’re revenue optimism those again, a so like nice the we but in, a We think for to probably setting in feel in that continuing perspective, revenue see us some that in XXXX. continue really trends into And from multiplier the seen it’s up the the future,

then seems you it guidance, that if us Okay. lower. your could for there like, a you half and the follow as because have is ask it’s only give quarter, and quarter the I a lines reason, of just third but of for between up, Radisson, in Radisson I’m reading the Thanks on if sort that basis. a domestic rate And royalty The quick clarification. separate

four for on the lap to royalty of three just or see start of I to to quarters, before And want understand the grow integration have if system-wide basis. next sort rate Radisson so that again we domestic we the

the certainly X%. it’s X%. is portfolio effective that I see for lower the than rate The Yes, Choice, royalty the to Radisson think, X% we in about closer

for ability expect unit. royalty the of on those include to more Radisson to effectively. it of a the full we effective guidance lap provided the our, to would year in more, our just continue model And the have business not more metrics, to exclusive have that rate as did you operational to guidance that so basis, We’ll report apples-to-apples. you some So order see core likely a

thank helpful, you. Very

you. Thank

any to will floor back we question-and-answer remarks. over to for the time this turn at I’d today’s gentlemen, and ladies And like Pat conclude closing Pacious session.

you, Thank this your everyone Year. we a Thanks day. Great. to again and Have really We rest your morning. the again time you for you in season great a wonderful talk will Operator. wish holiday of New

thank do Ladies and presentation. conference call today’s joining. for conclude with We and that you gentlemen, will

lines. your disconnect now may You