Choice Hotels International (CHH) 8 Aug 232023 Q2 Earnings call transcript

Ladies and gentlemen, thank you for standing by. Welcome to Choice Hotels International Second Quarter 2023 Earnings Call. At this time, all lines are in a listen-only mode.

I will now turn the conference over to Allie Summers, Investor Relations, Senior Director for Choice Hotels.

Good morning, and thank you for joining us today.

the like predictive you be or assist in we'd conference during used begin, results. you certain its call, forward-looking understanding we to that remind this to Before and company statements will Actual results indicated statements SEC XX-Q, use that and affecting filings Forms should from for consult company's important and you in the risk the factors forward-looking to XX-K differ may materially those other information consider. about company

obligation date forward-looking update to speak no of we These events publicly today's to circumstances. and subsequent statements reflect them undertake as or

Relations measures can to of reconciliation You earnings posted under a of section. find quarter Investor website second our our press part non-GAAP as our financial which is choicehotel.com on referred remarks release, XXXX in at our the

President Executive Dragisich, Chief Pat This quarter Officer; will to our morning, Chief our results our Pacious, Dom operating performance. speak second Officer, Financial financial and and and

be take Dom's Following to your glad and questions. remarks, Pat we'll

Pat. I'll And turn that, with over the to call

morning, I'm Thank fueled and [Technical once hotel of our generated integrating schedule. impressive Americas exceptional in Radisson pleased Choice that rapidly conversion you, Hotels best-in-class success good to by and earnings, report ahead our again Allie, everyone. capability, Difficulty]

growing ranked segment hotels time, brands, same our segment. in stay satisfaction, WoodSpring At the number the guest two Suites in of in J.D. and Power one upscale fastest Cambria the economy extended

significant, business amount drive which our executing meaningful enabled have to to further earnings return are in velocity we strong shareholders. performance and our at capital the Our us to growth of invest a long-term and

have start our with EBITDA in growth. me momentum we created Let the adjusted

owners, which year six marked of points our record. growing by our to flags adjusted quarter drove engine XXXX the than a the first new business strengthening the EBITDA is prior rate, franchising allowing we second independent effective and competitive brands franchise our months our for best-in-class and strategy increased higher X our value growth convert success to basis while to to million, $XXX and us XX% royalty distinct provide XXXX to quarterly commitment proposition Fueling which was Our year-over-year. our

carry expect stronger of profitability higher have with this rest delivery the unit, leveraging improve built the hotels engine as to grow through franchise to We we of each we strong business that while generate business royalties our momentum per XXXX, franchise. the

gives At our more created the platform increased program, our the the scale opportunity co-brand business learnings we integration from Americas value leverage franchisees in Radisson is expect to growth credit and size ancillary guests. from we even our This Americas for loyalty time, a acquisition significant extended were footprint business, What and us our believe change we function has able will the optimism the Radisson step in expanded create driven which significant of opportunities, and Americas of realize revenue the card region. brands. the also division, same to our

very already platform believe Specifically, with our are for which tailwind additional the credit strategic initial new the this acquisition time, and co-brand international our contribution Americas, same of a and At growth as our portfolio. XXXX of remainder the strong EBITDA of agreement partnership provide pleased for segment expectations. of more and have We exceeding an organic the business we the doubled will beyond. our earnings card result than we Radisson is

RevPAR Our above significantly levels. exceeded expectations second International performance has quarter division's with our XXXX

future XX% this comparable to basis, see We the XX% Our period our region of International the to portfolio as a wide RevPAR growth. compared growing with same increased company's Americas strong on a trend enhancement XXXX.

repurchase shareholders of our has strategy return through to share our year, representing historical outpacing achieve complete results, remarkable past our XX% and shares repurchases. million enabled significantly the us program, share outstanding $XXX over a and strategic the financial to Over acquisition

business of we delivery the is new to growth enhanced are future about growth our vectors excited the addition able are best-in-class engine we unlock. now Americas now and to by Our Radisson the brand

outlook XXXX raising pleased that are we full for report year such, adjusted to EBITDA. As I'm our

success The well-segmented environments. across of versatile diverse needs business this the of developers. economic suit and to we portfolio our all have built cycles. provides of variety broad to brands array diversified properties, to throughout construction and a new growth a wide a represent consumers grow avenues healthy of in of price economic attribute We of points brands These us mix hotel conversion various allowing

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years, our number to our brands the of distinct has and the expand the have strategy. conversion we segments. more new in acquired incremental been of last five construction franchise business cornerstone or reach And intense of launched revenue and Franchising a always

franchises of franchisee significantly have of earnings new our expanding network customer segments our accelerated By a these growth. The scope, our and opportunities reach, and are driver market our we future relationships more to increased accretive algorithm. in earnings and our key

strategy brands. results growth delivering improving the is selective Our our of unit attractiveness and

number domestic week than with average growth. revenue our In in executing intense driven year-over-year the a royalties a second saw our quarter, material for XX% Adding total and more openings, more we optimism by company the increase year-over-year. a by grew all hotel is the franchises of segments of of XXX per our the segments strong of XX% openings across increase momentum to this openings hotel across on four

international rooms In by international by second addition, XX% grew pipeline in we and expanded the rooms our quarter XX% year-over-year. our

delivering improving while we proposition to scores growth enhancing value our this brand's consumers. satisfaction guest Importantly, and our are

two Guest released very economy of brands proud experience hotel one are and America study. brands North We Hotel Power Satisfaction ranked number stay that extended recently XXXX upscale our for in guest the Index among J.D.

upscale as honors extended in highest strong factors portfolio, recognized with also According the guest top study, recognition best-in-class and category, economy score This scoring satisfaction tools other stay the earned was our only our to with enable XX experiences. all not in same deliver study's the upscale of and time, the studies, exceptional satisfaction for factors. dedication the all to them the providing hard top five in to customer testament Cambria brands At the in Suites outperforming brand work had guest underscoring solutions to WoodSpring of six franchisees the highest a but that segment. service, the we've is franchisees' success our guest the

operations, lower details our revenues strong hoteliers as by thereby seek Let about competition our value boosting versus their costs, core choosing brands Attracted the line conversion hotels. improve hotel and expertise. our they deliver the value their are to proposition, long-term me provide top of strong more their

expect pipeline we quarter-over-quarter, our three domestic conversion projects than we within a open growth for the next in second XX% quarter, In fact, drove months. hotels conversion and the rooms XX more to in increase

to agreements domestic domestic addition, hotels. projects franchise In to agreements pipeline. expected of first Of the are support, end or the able through the of this XXX the superior opened of processes speed-to-market conversion open nearly were are already best-in-class four of have the conversion in franchisee in for conversion by Through two-thirds quickly half our we year. XX% awarded XXXX, hotels the and the half we year first executed move

in as doors fact, and are The our generating so XXX in the our in see of us quick activity conversion that continued under beyond. XXXX numbers. has we in pipeline average. In for just confidence properties momentum our growth days opening our we This some on appeared of hotels never conversion and prospects in been conversion royalty velocity quarterly gives economy further the hotels openings midscale

integration quickly original of the million brands. is the remarkable. strategic integrate our we brands in to to to proprietary of Americas our turn truly state-of-the-art than rapidly expertise $XX incredible is we our success we technologies, expected. success. integration long-term and achieved Thanks Americas Radisson the now synergies drive key speed to integrated exceeding ability target sooner have achieved our which in investments me And with Radisson The Let synergies have already annual and have recurring

time, same and have we additional engine. business synergies delivery begun revenue transitioning our onto costs that hotels future now the unlocking At the anticipate

year first this ahead to to in business Americas And million. to return we us Our adjusted to XXXX, deliberate year, the year, efforts Radisson number ownership. profitability unit $XX of Americas our in project over we Radisson next are This schedule delivering EBITDA. grow enabled of

As our of franchisees of a entire reaping and integration. are guests result portfolio execution, across the brands of the benefits our substantial from speed already

completed we key milestones. integration ago, weeks two Just

our onboarded year the acquisition. programs Radisson two than reservations integrated we Americas all Specifically, delivery a nearly less XXX world-class and the under award of within hotels loyalty engine winning

with the all hotels cloud-based year-end, Americas industry. profitability Americas awarded and our to Radisson started to Choice and as eligible management choices franchisees top fully employing the Radisson drive we with performance This key platform integrated bring line Americas their hospitality University, we revenue We provided systems their expect systems. and Radisson And management property in month, help best-in-class to to widely to also such operating our costs the by and access tools, proprietary most level. learning migrating with resources their next tools, hotels reduce

their our further increased family, part Radisson have by world the In excitement the X.X% specifically by our Choice class portfolio RevPAR franchisees success second system. year-over-year. quarter, opportunity The us underlined Americas Radisson the the Americas new to edge is Americas business cutting unit franchisee becoming performance. Radisson enthusiasm leverage of for generated and with wide proprietary technologies shared

by Specifically, points. grew the upscale X itself XX% Radisson the nearly outperforming percentage segment year-over-year, brand upscale

that paying tools, and brand strategic across segments. off we've decisions impressive capabilities value Our the portfolio demonstrate our and deliberate in investments our are results platform proposition and made franchisee

XX% In nearly First, we by doubling the first franchise business. a half of upscale by upscale grew openings. number of units the highlighted hotel in our year-over-year, strengthened we new our approximately domestic XXXX,

agreements year-over-year. franchise year-over-year number XX% At upscale pipeline awarded a XX% the expanded domestic for the of same we and by hotels hotels, to conversion XXX our time, domestic increased increase

acquisition the growth Radisson while broadening Radisson in We expect the will that and Cambria build portfolio. enable our on to the brands Americas us upscale Ascend also accelerating our segment, momentum the of

growth in May, number highest the over business an pipeline of our expect month of franchise We state years. and units average to year-over-year growth openings mid-year next the at we executed Next, a annual number stay franchise and over business increase in of the in remain stay grew XX% about XX% the than at years. further for by very our optimistic single our extended extended five domestic rate invested extended two and more

At reaching approximately domestic year-over-year, the franchise of we portfolio brands time, XXXX. X,XXX half domestic the reinforced our core upper first business of by mid-scale growing in XX% our by same hotels

strengthening the the owners economy by effective that business, transient to franchise X proposition by royalty in franchise value Finally, we points second our quarter segment deliver in our the year-over-year. rate grew basis for we

look We the relationships franchise drive in we accelerating completing Radisson business unit to of owner thoughtful, years. and by that and these network Choice deliberate to scale, Americas royalties and effectiveness our the leveraging higher exceptional generate to confidence integration in confirm growth brands results coming our success per XXXX reinforce best-in-class with of and achieved The the quarter franchise growing system the our franchisee of Choice's results our forward second hotels platforms. of digital the the in ability with approach

will We on execution to achieved speed beyond. growth earnings opportunities capitalize in believe us success our we on quarter and to the and enable and further algorithm powerful well-positioned XXXX are build this of

results. a work In like closing, would their invaluable hard achieve to take I and our to thank for moment to contributions our associates

to integration something achieved to across the business, transaction. Thanks and this addition is schedule positioned our core are to than shareholders the remarkable. experts to The increasing group In is year of benefit ahead The closed well and we bringing now dedicated hotels our of business them, the our incredible business Radisson Americas franchisees truly into are one better also and we future. growing stronger. less guests our value of our since

CFO. our will I over that, With hand to it Dom?

that what Thanks, Today, on additional like results, note Americas lies Pat, and on I including impressive I'd for quarter second impacted everyone. my Radisson ahead. one-time reported results. integration allocation figures approach today, Radisson would and insights and certain good our which to our quarter costs, sheet Throughout the portfolio remarks update all Americas morning, expectations are and provide balance the like second items inclusive capital you share to of excludes

period XXXX quarter from increased excluding compared revenues to second XX% For franchised to and revenue reimbursable managed of the $XXX.X same properties XXXX, million.

Our rate growth, by procurement adjusted driven $XXX.X robust unit adjusted integration, XX%. Americas comparable successful the an continued $X.XX, were Radisson international execution our effective share margin strong and businesses of of platform, to million, per grew XX% earnings EBITDA our royalty of and expansion. performance the And increase and

our are Let per key and key advantages. is unit our me with the to growth portfolio where hotel levers, absolute turn our size revenue revenue beginning royalty

results which revenue royalties. segments to goal and in strategic simultaneously markets an intense outsized Our ultimately in increase growth rates, room our has been more while growing accelerate royalty in effective quality

portfolio, mix and In brand our revenue addition is strategy the evident our broader individual hotel to levels. maximization the also at for strategy shift

second for of fact, added revenue hotels XXXX, we within continue quarter exiting an a hotels than higher XX% generate In to royalty new the brand brand. average

by For while quarter revenue XX% an more year-over-year, of rooms upscale, increase XX% size grew the domestic segments and openings hotel highlighted grew XXXX, quarter XX%, to number over second in our compared extended by second intense new of the stay XXXX. mid-scale by system

by international increased rooms XX% by while grew our also system We X%, size year-over-year.

grew Our and and the quarter At intense first unit year-over-year. to capability, come. quarter pipeline, and our international conversion growth XX% and by represents quarter revenue time, this the we in years XX% second optimism our and global which Reinforcing domestic this respectively, second our best-in-class of our to expanded same for rooms year. XX%, pipeline by the growth rooms conversion our year acceleration first and versus drive expect in leveraging compared quarter we domestic the will year-over-year for international the which is of rooms unit an X% hotels

across We our are very optimistic segments. key all about of growth prospects our

by grew reaching XX brand with units the Cambria the in an domestic pipeline. example, For XX additional XX% year-over-year, properties

our which increased the number global through of agreements for addition, the ranks Ascend with In Hotel XXX hotels June of brand over soft worldwide largest by year-over-year. end franchise domestic as XX% the collection,

stay the extended projects Everhome Our gaining brand, across XX is with newest community Suites domestic traction development the in pipeline. over impressive

a quarters brand as successful refresh, increase of year-over-year. of same time, the year-over-year. domestic Suites XXX since straight pipeline XX the end At of WoodSpring June, unit registered And reached now nearly its properties growth Comfort has XX% the

the We more is are the full we year for approximately our with pleased XXXX. growth domestic of year, X% unit of above the accelerated tracking trends our growth net intense segments are driving. revenue slightly Midway through guidance system

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

X.XX%. increase a half system legacy first points effective domestic for point X brands Our of XXXX the including year-over-year, royalty increased basis X basis for rate the to Choice

are our our portfolio the to ability Americas our Given as value franchise to Radisson size as the attractiveness rate franchisees, for expand the effective on proposition investment of of strategy portfolio. we behalf Choice our our overall strengthening well and our of proven and in grow confident royalty of the both legacy owners our brands long-term brands, our the

of for baseline Americas we XXXX are full outlook mid-single our X.XX% Inclusive the effective basis a our rate from Radisson in comparable to in digits maintaining grow brands, year-over-year on royalty XXXX. a year

legacy by year-over-year. growth increase and increasing performance X.X% This year, Choice Last RevPAR XXXX. in second our continued on of our Radisson XX% building additional in lever, growth RevPAR we our I RevPAR the basis year, with portfolio increased same from quarter that will second revenue XX a quarter discuss by points our was growth performance. driven third are is an The quarter both This RevPAR year-over-year. America's

upscale by the segment's Importantly, outperformed brand itself the Radisson RevPAR X quarter. percentage growth points in the second

year We growth domestic are to XX% growth This year RevPAR X% XXXX. full maintaining RevPAR continue an full year our XXXX. and guidance approximately increase to compared compared for domestic approximately represents to full increase to expect

momentum platform continue to we As strong Pat on of mentioned, the build business. our

revenue quarter, we other growth our this that of platform. same believe million the number increased guests of we the the nearly by fees second drive services years in millions and offer period platform we and partners We can compared procurement while travel in we XX% as increase X,XXX products of to strong and our to expanding the XXXX. Specifically, $XX.X to services ahead hotels,

to maintain sheet balance like a leverage I'd times, of X.X of now believe to strength debt-to-EBITDA our turn of range of to which We quarter the will end XXXX. a of low growth X of with times to the the driver as to come. which balance be we another our gross sheet, second years our be times continues for ratio best-in-class X of targeted below end of

$XXX shareholders. through in now returning $XXX approximately million in repurchase repurchases. shares the as to July, have Year-to-date million shareholders Pat share of our through These to in cash we year returns alone. we program, returned million million XX% form approximately our over over repurchased share outstanding last the $XX and dividends $XXX of our came And mentioned,

With our our remainder on strategy into shareholders to for strategic capital of capacity, continue the of future. we to are well pillars returning and to leverage We the record allocation build strong of positioned all the the making plan cash cash flow to our investments, year. well business debt excess and growing

outlook platform to June year, Before publishing of remainder expectations than revenue turn to what given drive for we additional investments the and remainder favorable the more the lies opening update, for up stronger July approved forecasted business for our expected international like Since questions, long-term financial results, year. and I'd our of our ahead the for growth. refined initially to

outlook our between adjusted $XXX $XXX at of XX% year midpoint XXXX. year-over-year expect range it the midpoint the and raising are we and that approximately compared representing million and year now XX% growth report growth for range million, to full EBITDA to pleased XXXX to am full I

As from well by growth other rate Americas revenue growth and organic XXXX, contribution adjusted as to approximately we markets, intense driven look into Radisson strong generate the royalty of as in effective year-over-year, we EBITDA more expect factors. incremental segments XX% and growth

the expect Today's keep intense For guidance segments. earnings per a our to intend at more $X.XX a of are core XXXX growth range full representing revenue across share, working, diluted the adjusted the XX% strategy growth testament is per we that year-over-year. year share our we midpoint to in $X.XX vectors between and investing results and

At this any answer happy I to would time, questions. be Operator? Pat and

Ladies begin session. [Operator from question-and-answer we the question and of now Instructions] go Baird. First Please Bellisario you. will gentlemen, comes Michael Thank ahead.

Thanks. Good morning, everyone.

Good morning, Mike.

morning. Good

Just the on to of expectations. maybe building growth help get of to there Thank rate dollars the question That XXXX you understand Can blocks percentage be get terms XXXX? the first underlying your that some XX-plus would you. and helpful. in then us assumptions in you the

Yeah. Sure, Michael.

our Let trend back over business, grown me than just growth organic look just if the look the all mean start. year the going and at at it's to XX%, EBITDA I of years. last way greater continues and I XXXX, I mean if that been this think several you the you we've years exceptional at this year.

a at of organically shares bought multiple we of And outstanding. look acquisition, XX%, we You with business back itself, today, avenues our XX% earnings completed our a last by year in the that's growth. got sit grew strategic

segment, look down hotels economy from segment our to new of it's plus conversion upscale you and intense, brand If the obey extended a at stay. revenue the construction mix, mix

on advantages revenue have to and we a robust the size business. of to lot our more are scale travel And as international monetize is is with partners. really of opportunity doubled what's co-brand the credit the really the allow now prepared that we've business we effectively us Our going platform card opportunities now remarks, talked exciting much that the

lot are into going are future. So keep factors giving of double-digit a confidence EBITDA this really in all of to those us our ability that growth the

royalty other know building some rate Any blocks underlying growth, Radisson you've in I specific terms RevPAR of provided commentary. expectations?

Yeah.

or wanted to guided tactical we a create contribution over more you that from past, a think you million the EBITDA increasing in bit of Radisson would the if $XX of to $XX fact little more bridge, If to mean, million. year be this I about

about business to of historical approach growth about the X% terms those So levels, in EBITDA stabilized call talked a so more overall it growth that's unit X% starting X% of going to environment. in forward. intense our a the revenue

next And just EBITDA Talked so X%, growth. card another co-branded you that credit business, so about $X closer contributing would maybe think especially our overall another million about into to year. you're which getting platform when or represent the X% heading

And to we rate, digits. effective to mid-single in continue royalty the maintain that then our expect

there's future. share an essentially to continue that flat. So is get that RevPAR a the just RPI our path XX% to our Obviously, not in maintain in even really a share, from perspective we if environment grow to

of Pat's has get ton points a So to environment. sort historical path expect its thing the percentage industry to think to RevPAR you well. of there But this there's contribution RevPAR grows most another a rates, at the I those as there important point, at business in any and is, of would see levers disposal, of couple revenue

Thanks helpful. the development just That's it. on then Got a pipeline. detail. follow-up the And for

You around convergence the quarter, pipeline the XX% versus but is this mentioned overall prior down. just

Thanks. correct? maybe out So bottoming forward? correct, presumably, all that what's under sort looking that's if And construction you And do when that? that's driving then of see hotels,

focused the we being are are of pipeline higher Obviously, Part is that timing. obviously franchise on awarded. Yeah. agreements quality

intense think year-over-year those so rate, So that we're are really agreements when revenue kind success development more of down we about a maybe opening having it targeting the higher you slightly. anticipate franchise results

of terminate there feel are there's in mentioned openings success. continue to So assets and our moving of our but velocity we there. out the an through these lower a We those is pipeline. Pat the element like likelihood strong pipeline, which do

back high spike half to development hotels, opening conversion itself, our very XX% have of up pipeline back at than when look rate. XX% construction, pretty see a either to healthy. results About tend very significantly. Greater domestic the that's the secured. which conversion hotel financing our of When under have is essentially your of pipeline you a success the is you or you when Michael, But year, get pipeline is

last growth in significantly what of see seen of to tend pipeline the that’s in the you than we’ve quarter So quarter-over-quarter couple course the in higher particular, quarters. four, over

Thank you. me. for That’s all

Thank you.

Thank The ahead. America. from Asad of comes question Dany you. next Bank Please of go

everybody. morning, Good Hi.

at growth you. your RevPAR plus level, what in give -- unit meaningfully a grew would You're higher just quarter of the fees like ahead

So of something the tune X%. like to

so And can year the maybe kind that this expect how just half as you and about to perform spread of we into talk well? that should back as look of we

Dany. Yeah,

an business fact basis, of now, fees So grew in when obviously, apples-to-apples your basis, Pat X% But kind EBITDA for that about the an just describe think royalty is on right on revenue you way mentioned those XX%. I about overall, is the almost the contribution and the up the from now that our Radisson are line adjusted kind items. would of Choice year-over-year. at revenue apples-to-apples

So we of growth very this about feel organic prospects good the business.

be talked I co-branded our approach rate $X million. continue question, grow is we point of $X.X those kind the about that, unit historical mid-single last to levels, we basis X% is about the ancillary going growth at and going Every itself, likely other think card, each strength platform. is that credit in that We item offering said going effective see our forward, royalty to franchisees. expect, some like programs But of the you core fees I and those we'll look the royalty you're line in to revenue to intense continue services X when digits. think in million. about will

continue do maintain talked to and our to we hare. -- we obviously, about just RevPAR expect then steel And

per to the hotel, the more we're that outsized I a royalty is XX% the royalty mix or what's performance algorithm. really within hotels, earnings think intense brand we shift royalty revenue per location really to see that But into the are that even higher is segments. starting unit higher a focusing driving on core to continue fact itself

that, you. natural counts Got just sort room it's it. looking that all about would for are room count, like level room of brand when and to that And be question would churn there But your along Radisson you specifically. And And these of than costs on when last third if I to guess down? with year there's would M&A. expect you like my X% expect, when fade? of then less quarter just at integration domestic When onetime to the for slow expect you add-backs? Thank the then I'm some is, any

Dany. Yeah,

terminations Let mean in. it we and franchise seen when in. was me we buying which underinvested We -- a business was business, at looked And significant that and can this of a I think Dom into their effectively I a start, existing then we've that jump of at pretty risk expected. were did agreements franchisees things leaving. their were deep and into pipeline dive lot

that So here. the of the sped integration transaction. really underwriting why reason into written all we've was the the up It's

going We demonstrate these bring value prop want to to the to owners that they are quickly and the significant get. upside

that integrated seeing the hotels increase prior it. to where onto expectations. systems, seeing brands already Radisson We're now seeing being go up ratios in to integrated. our look-to-book versus traffic are beyond are the our We're they were We the

achieve, customers to we and those delivery are So business our bringing expected achieving which what that to franchisees. we is

on they're selling now platform, ability the we -- now -- you're future to the you're the we not just reality. selling have that What potential,

and what development proposition our into has these so move value team to looking here been on focused And begin we year the half opportunity is really grow the back as at to take of the now that brands.

grow brands we at coming. But all we to our the franchisee. also Certainly, say of we're shareholders, the M&A, doing along and want that's ROI look these what's we to want for benefit for we that. the grow As

put we both more you been new Radisson were pretty than Radisson the we our successful in. If key Inns going look at what efforts retention had that wins we've with done on and some of place, actually we've already some successful, expectations in

value feel brands it the get ability get them to future. pretty on about the into get and So to growing be confident we our proper our platform, these needs

Got you.

and Yeah. just Dany sorry. -- go ahead,

No. ahead. Go

go. No, We've hotels. once these renewals just obviously, that you're many in been on mentioned or particular, about saying to XX relax more even so when you think successful Pat XX about close and were letting the in and the cases, talking comfortable assets, X%

So asset, that a decision. when higher-quality making it they're is

do I expecting that going into your when see on would in to think to Pat's think see stabilize the point stabilization point, to to portfolio forward expect you I expect we're growth. think I that you XXXX,

Radisson the itself conversion brand more a think brand brand. of legacy the core I or

So we faster expect in I short see that to the think grow term. would

think that would we as new that I but see would you Country of expect portfolio to a more in see construction And stabilize. to then & brand, more start Suites XXXX,

Point make rate Your question specifically did the we and We pass we're decision to integration, to on happy cost. the invest the integration did. and

results for themselves, EBITDA think remainder to We these year. significantly tracking the much expectations. I would for slow higher the than expect I think, costs, the speak of

And of then basis, comparable on you at would be immaterial. look it year, pretty the it when a essentially this at end

into But year. lift heavy Now behind single-digit half trickle maybe a decelerate to millions, we start going is back you're to few the kind into of of speaking, see the us, now could think and the XXXX. broadly those we heading

Great. I last in sneak just could one Got then if it. one. And

like out? from opportunities And Radisson. success, thinking Radisson So seen at you an are least is given going that here giving on we've forward? How playbook you far with execution this about M&A

Yeah.

a years for talk the demographic, home WoodSpring that of I it amount five traveler, higher of is for turned kind $XX very lift think, a rest as of extended of not run in getting to front stay industry. Radisson more us. and Dany, different. really the ago, was reinvigorating a a acquisition is RevPAR, a bringing we the really regard synergy bringing younger which was that with be successful a Radisson us us us shift to synergy really more business deal, with million. and segment but about to a the significant a out of accretive, revenue And out invest,

So we look these an at don't always perspective from the as execution same. acquisitions

strong underlying a But very for strong we've that we've integrate you had a we very needed growth brought all prototype. it's development And the certainly look what company brands. the think a certainly the I things, factors. capability in had, -- that But drivers have at was and of value same not it of and the the strong we to the lot market. these within What is a the engine of are. capabilities playbook the And case to key in developed a rapidly pretty to WoodSpring, pipeline,

needed needed loyalty delivery all on platform that reservations. revenue a for tools the like. Choice program. that needed a was It Radisson needed It bigger bigger What and business we bring the University management,

time of little rapidly a bit is company an I as developed capability pretty pretty rapid frame. and strong we’ve realize in of a acquisition a to these value would the So say integrate different. But a each

Thank very Got you much. it.

The from you. of ahead. question Please Thank comes Grambling Stanley. Morgan Stephen next go

Thanks. Hey.

for M&A opportunities are best to there's on maybe incorporated you still follow weighing you activity? want you. I that M&A M&A. the other levels was up commentary Just through target buyback in both XX% below little Is there are better either how the any additional the reflection or of in a then growth versus given of that a XXXX out? slower capital bit uses like the mean, that is of laid bolt-ons XQ XXXX? XQ. and discussion Thank looks It And leverage

growing always for brands owners we talked We're that the tests shareholders. ROI and M&A litmus Steve. fits for the the Yeah, the X looking the for about, improving that

international a as on portfolio. the think some space we white there's potential still look of front. I in forward, our lot opportunities There's

that the at. to are continue So we'll those areas look probably

$XX EBITDA right our brought an another the I also Radisson Remember, million more number come the of we I to Radisson Radisson as brought there is now, would there's to in Radisson Individual. XXXX, from brand Radisson boost acquisition. -- Blu, upscale come the additional XXXX expected we There's still upper in say benefit mean, from in mentioned.

we to other acquired that I some us, are that to give there's to in segments think, opportunities longer-term we some going today. aren't continue brands in So grow that

the we acquisition think I in. do also -- there's when also shareholder during last own summer, do those the organically. opportunities arise. blacked I I provides some So opportunity Radisson to repurchase, potentially But out bolt-on can if we it shares an buying our effectively at from or M&A look were share mean

opened, little when bit planning back were So the in August, we of window a catch-up.

understanding I July. in didn't that early just true business growth. it's the of next our think for reason And that I like the year believe X% growth a at we consensus think that then -- fact potential was believe was I update market We mean, reflection did had. the that the we and it's we EBITDA

an gave the it on when and repurchase And that been growth. we've shares us our about front. So talk share pretty at a opportunity get intrinsic out to we see discount to aggressive value,

a see intrinsic discount so long to shares remain at I think as continue value. to So the that you'll

then And one quick other follow-up. it. Got

bit, segment or about base? on are you conversions little this versus duration generally finding focused think contribution as where are brand shorter of royalty And line do the Thank sight typically growth of we think this kind mentioned scale? you. but have chain I a you to of you

Yeah.

you franchisee brands the best-in-class. as value own think as retention I there, look independent and rate opportunity own our stays our and hotels. gets Franchisees when other our out at better proposition franchisees

franchisee within of the There in lot a States base. that is in upscale are we and So independent the the our hotels prospecting own XX,XXX do below United are segments.

there's hotels independent brands well brands. of And company a ample XX this XX years, the been for for opportunity our conversion that's doing So here conversions. conversion are is as for game an

So lot we of opportunity. have a

in why The has with we of it’s this they stay more always we high. wanted Choice. towards rates that. is a where to it We’ve one been previous proven points reasons economic shift market where and And likely the today during going of to and conversions, interest the opportunity are the when were being to strength interest are cycle rates there, highlight

really our do in numbers. record that track and ultimately in well, know achieving something openings a of and we So hotel how conversion strong we our growth have rates to pipeline it’s

Thank you.

you. Thank

Robin question you. go of Thank UBS. ahead. next comes Please The from Farley

covered Thanks. guidance. any are there of not that? clarify couple or could to already, did counting know that you're ways a questions different but my But have on to been maybe to said just clarify. your of get -- I Great. to you XX% Most you I Thanks. did you want acquisitions get to

of Radisson included Pat's that the the the no XX%, obviously, million from to outside $XX acquisitions additional No integration. in is point, but Radisson of -- contribution

Thank Okay. you. Great.

you. Thank

question David Please Katz comes go next of from The you. Jefferies. Thank ahead.

and those things, then in One I international right, opportunity is international earlier is, And are you here same may. thing concentric please. have just and where I the Good Is the opportunities, quick Patrick, U.S. I to the space or follow-up, I one addition you space space see in white two white clear, Hi. to want if had indicated opportunities. be the morning. white international?

Yeah.

David, I think, both. it's

space but you have mean are have in a having in we segment, success about we if think white upscale domestically. So with extended of there's don't we Everhome in product I where space -- we're extended stay. stay, extended lot mid-scale a the

for opportunity have. just water bit upscale Blues us. we the are toe Certainly, -- little an a rates a in with in that's have and So the of upper collection with Radisson that we the

So there's some opportunity there.

But you same the thing. look when internationally, see

a see You doesn't product And opportunity at opportunity we to that we routes Americas look lot when where markets, I of the Americas the there's blue different internationally would say play in the significant and well the in type have grow. region. international

be in of So of may U.S., that not the outside may different. the you look here the see something a type U.S. product It when lot potential be you acquisitions at

convert traveler stay, shorter they a business rooms from there's So where a travelers. there's leisure to

some So really models for out the international markets. on there front international that different work certain there's

different the certainly types the as across well. international international. So are there's that I would landscape, white space in U.S. But the in alternatives say side when we're lodging and product there's looking in also

to So that what And we bring that's we see when we where across into the our maybe opportunities for portfolio. we that's look value, when we effectively landscape. can see bring look

do prepared back there's remarks, opportunity. you scale have positioned. from many of and we're uniquely sort of able those remain about capture referenced have are think, also you larger if entities Patrick, What -- the pursuing a to But and And I talking record, had hearing And past protect no us as And sizable wanted I that et cetera. track competitive I that physician conversion Understood. you continue may, question to have? the platform circle the sit where on conversion what more in your you've to you and more in -- opportunities just you the and opportunities. those to

Yeah.

the get company lot you're a you into think don't regular if basis. on you with a I conversion issues market, do different when than that might as you a dealing of

get of The a completed. market, sure of forth, you're not So PIPs sale lot and that hotel tailored detailed. and overlap are conversation the franchise right involves that to and making that make sale And is PIPs franchise. PIP you product, you back complex is uniform, rather the everything a effectively from achieving right to brand that conversation a for sure from making And that I a owner that the a market expect is right what to a PIP rather say. brand. It in have would sure of really those

a it's owner. So different approach the to

XX something, that and a we've multiple it do And we've We as over in years. core brands, for it's it's I competency doing been said, built.

doesn't. of lot what I qualified, drives it think being what best-in-class on from that A works learned for and lessons and being uniquely when you experience So about comes and experience

fairly brand over is our growth do it's not on lot because years. highly continue the past conversion our confident it's to in and front confident a ability we're So fairly, we leader a of growth we're to that's what's equity brand in the driven why on but the XX competency, what our core and be

in David, historically our majority at Yeah. somewhere of when is X% The your churn X% you churn. has numbers the look range. speaking, been essentially that that to vast involuntary

so that tracking lower at a voluntary you're actually in to X% the churn been X% year-to-date So we're to historical, it, churn Again, the It's to discretion franchisee. year-end, be where a you of at look to still it's from we by that or choice X% X% When range. range. end of the take has a call that our and where particular perspective, discretion. expect terminate

So about term we're perspective. where good a feeling pretty from stand we

you. Thank Understood.

Thank you.

Please next Brandt Barclays. comes The of you. question Montour Thank go from ahead.

to get and to number million ask morning, on we Good new guess full could that me you the I EBITDA to the for if Thanks number into in. Hey. $XX add can exact just just everybody. year for Radisson I 'XX? give to squeezing baked us the $XX want million,

Brandt. Yeah,

to So curse. winner's slightly little Obviously, million about would be or talked we've expect broadly below an than that of a $XX million. $XX so. could there's create a speaking, maybe bit opportunity that greater I

this is synergy. timing part So of the of

think I just So XXXX for what when at you look you assume is $XX should for it's expect. the million being that Radisson over the EBITDA, safe to time

weeks? and Okay. Thank a full last changed over today. you then obviously, for three reaffirmed just that. pre-announcement few weeks you guidance guys a And you year raised in the ago then What

Yeah.

the think we about end we of felt guidance, within up So just when million range. how million. moved you obviously, in the little when the in. $XXX financials to that to closed books, trend above there, shifted, royalty Really, Obviously, lower range drivers from the once the $XXX a effective the expectations. about we Obviously, up reaffirmed we came pretty came good rate better expected. bit being things financials than the continues have we

which is seeing you co-branded impressive actual green the credit some of look counts, we about a card. about rebound et business, has XXXX other our take months XX when you well. levels, more where from an the to portfolio The internationally what fee you were been ago. pretty well, as in When portfolio think And RevPAR XX to about international shoots higher perspective. is platform as mean, is And where when I to back pretty at the lot above we're XX% talked streams, in we're those We cetera. terms internationally, both think room remarkable of portfolio, really tracking the just a XX%

some the fund, decision from on the the off impact an adjusted of slight end it – Obviously, flow all you net guidance. to more meet adjusted removed. that income. when which takes higher had investments the optimism that I we and So and us And were gave think res to as-reported those additional through that’s a marketing puts EBITDA made we perspective, make just going of

speaking, the million pretty scenario And So that fall tracking high we’re end that $XXX a think I on we’re the all guidance. we if see broadly where million. place, $XXX chips bullish could to of to into

much. Great. so Thanks

Thank you.

go ahead. Patrick next Securities. Thank comes Truist you. from The Please Schulz question of (ph)

everyone. Hi. Good morning,

morning. Good

morning. Good

and the I Good morning. about to view or I public and transformative materially bigger at When to better say fact, transformative, would large public Pat, be point I in think this M&A of that in for and you. Starwood. bigger company? past, able think bigger can, you are the about your some Marriott transformatively Thank keyword

the hotels, is you Obviously, today, as you're in talked script bringing of policy scale market hotels. Radisson the members, our comment lot XX% a not acquisition, and benefits know, you Patrick, about of on loyalty bringing kind million our rumors, going. to where in if bringing we've and more that's in saw program accretive more another this, XX revenue

that an bigger it's but All like and things a that. creating been by RevPAR are growth is of M&A just royalty of that story providing business unlocked ancillary us transaction for opportunities not those have and a unit more doing the revenue

the scale matters. So we segment. And scale have in we have And today. scale upscale certainly,

our We extended have scale core mid-scale certainly have in economy in scale segment. segment. and We the stay

standpoint is if acquisitions I in markets question expanding the it from two does. very scale absolutely, were successful past think our underrepresented. the that where presence the matter, we We've in key your have So of done been

that scale bring that M&A advantage to you. to benefits definitely there's yes, So

you. right up Thank Okay. feel those the level for Along -- to? hypothetically lines, Thank you. net EBITDA the would you what for comfortable to acquisition, going debt

Patrick, I think that. we on don't comment

stakeholder all X of to from I range that got you've think our at times it acquisition look any targeted times. the and to X end of groups speaking, the publicly is different day, at your

you for that that kind broadly sort speaking, stated our it a of investment value bit high or little -- X ratio is times that that of of at end see X leverage higher? think Would would policy I constituencies. you could for those really times. all to long-term Sure. But any drive

you. Thank Okay.

Thank you.

go Please next Greff Thank ahead. Joe you. comes from The question of JPMorgan.

And versus couple million of Happy from Of incremental morning. versus in this EBITDA fees I XXXX SG&A? how on comes a that $XX quick XXXX. royalty have have of comments follow-ups. another of adjusted your much I year, the million question $XX lower to on

it would to Obviously, on would that mean the $XX ago think talked is what million Yeah. two about, million, I in one somewhere expect dropped above which the item was see SG&A, to $X slightly you future. range. quarters you in we I I think or $X what the million and SG&A line Radisson that maybe

kind very into feeling be good the we're and of us. So XXXX the heading behind integration would synergies that about

Joe, the we your bring see the expect you would right of that grow maybe digits. to for which mid-single obviously, low-single historical up digits, to averages, with portfolio-wide, trended SG&A to investments, have So would kind in line

unit takes, to I guiding digits. I X%, the in ERR any RevPAR too be million, revenue-intense then of about talked kind the XXXX. $X bring in that We to And mid-single puts So in terms of think of early growth. close obviously, about tell sort to would it's and which think,

the a even was where see going as I half flat into we the path back But be of this that industry think to is going you're in to think is the there. I year. heading head a XX% point on get to that RevPAR environment, there still

with year. about of and mix maybe you're And you you're upscale of broadly point RevPAR that next royalty math flat how for me assuming just rooms I'm growth portfolio price Is based better you're words on paraphrase put assuming in can even higher and you next on But thinking next can year, hotels. you're modest year? fees grow how I'll then a your if that's blended sort thinking royalty fees -- and about

in can what you line we think grow your I with Well, very much rate royalty have.

I to the deliver think intense perspective, without think you you're as to mix get going higher even a from I some more continue shift So a -- doubt royalty mix of a segments. revenue story a benefits RevPAR in so

if levers broadly that I that a think or X was -- RevPAR that with that even rate speaking, absolutely I your muted there's XX% other path still can have. still think get to you royalty you that

intense your So effective growth higher revenue unit rates. growth, the with the and rooms especially unit that come royalty fact that revenue will intense probably

me. adjusted diligence And much gets to I then to versus XQ. back here of it then due is, gets a buying falls of have that is added And assuming for of the know And are all operating stock from what you there I follow-up. restructuring, any last sort my the reasons XQ? and in you into in EBITDA. that have And -- the for Great. transition second it most the XQ? XQ and question How adjusted back With I'm presently and respect the costs implied XQ half. precludes that's

I second I speaking, hit Pat broadly question on the hit -- first. No, think your I'll think

it we to buybacks, to the As repurchase shares. pertains expect our stock to would continue

still to think -- QX you I I the at at little trade a know a above we're our Radisson. catch-up point bit you commentary shares historically. blackout deceleration look at think around when well there's of still feel million, I coming QX. continue where $XX a playing of Pat's we Plus some we're And a out from point, to that's slight what to done at the But we've look from when discount. like

leverage at a So I times -- X.X ratio.

capacity We share repurchase program. certainly continue the to have

would from to slip the a may think a you be just have see think may scope would cost particular, XXXX costs, from deceleration residual I from that some that mentioned, quarter-over-quarter deferred. immaterial probably I into sequential was. as immaterial costs into compare XXXX, some just integration when But think in at broad perspective, look modest when Radisson you QX I some I it integration of into the – gotten integration QX what QX, you the XXXX QX,

Thank you.

Thank you.

over There are will remarks. I Pat turn Pacious no further to you. the closing Thank for questions. call

your have talk quarter again, day. you We'll our this you for great third time you, results. announce November again we operator. all Thanks everyone, Well, in morning. a to when hope thank I

your today. that Ladies call and gentlemen, for conference you ask and participation please this your We does thank conclude disconnect you the for lines.