Choice Hotels' Strong 2024 Performance Driven by Strategic Initiatives and Portfolio Growth

Choice Hotels International, Inc. (NYSE: CHH), a leading global lodging franchisor, reported its fourth quarter and full-year 2024 results, showcasing a strong performance driven by strategic initiatives and portfolio growth. The company's net income increased 16% to $299.7 million for full-year 2024, representing diluted earnings per share (EPS) of $6.20, a 22% increase compared to 2023, both of which exceeded the top end of the company's full-year 2024 guidance. Adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) for full-year 2024 increased 12% to a company record of $604.1 million and exceeded the top end of the company's full-year 2024 guidance. Adjusted diluted EPS increased 13% to $6.88 for full-year 2024, compared to 2023, exceeding the top end of the company's full-year 2024 guidance.

The company's strong performance can be attributed to several strategic initiatives and portfolio growth:

1. Strategic Partnership with Westgate Resorts: In the fourth quarter of 2024, Choice Hotels entered into a strategic partnership with Westgate Resorts, adding 21 hotels and 14,471 rooms to its domestic portfolio. This partnership expanded Choice Privileges rewards program members' access to over 180,000 upscale, upper-upscale, and luxury rooms worldwide, driving additional revenue and profitability.
2. Expansion of the Choice Privileges Rewards Program: The company achieved record organic rewards program growth in 2024, which contributed to its strong performance. The expansion of the Choice Privileges program is expected to be sustainable as it encourages customer loyalty, increases repeat business, and drives revenue growth.
3. Growth in Domestic Upscale, Extended Stay, and Midscale Rooms Portfolio: The company increased its domestic net rooms portfolio by 3.0% from year-end 2023, with domestic upscale, extended stay, and midscale units growing by 1.5% from year-end 2023. This growth, combined with increased RevPAR and effective royalty rates, contributed to the company's revenue and profitability.
4. Brand Relaunches and Ancillary Revenue Opportunities: The company successfully relaunched four brands and achieved record organic rewards program growth in 2024. These initiatives, along with unlocking new value through additional ancillary revenue opportunities, have contributed to the company's overall revenue and profitability growth.

Choice Hotels' strong performance in 2024 is a testament to the success of its growth strategy, which includes strategic partnerships, brand relaunches, and the expansion of its rewards program. As the company enters 2025, it is well-positioned to continue realizing the earnings growth from its past investments, meaningfully expand the scale of its business, and accelerate its growth in the coming years.