Delaware | 001-13393 | 52-1209792 | ||
(State or other jurisdiction of incorporation) | (Commission File Number) | (IRS Employer Identification Number) |
1 Choice Hotels Circle, Suite 400, Rockville, Maryland | 20850 | |
(Address of principal executive offices) | (Zip Code) |
o | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
o | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
o | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
o | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Item 2.02. | Results of Operations and Financial Condition. |
Item 9.01. | Financial Statements and Exhibits. |
Date: | May 4, 2016 | /s/ David L. White | ||||
David L. White Senior Vice President, Chief Financial Officer & Treasurer |
• | Revenues for the three months ended March 31, 2016 totaled $207.1 million, an increase of 18 percent from the same period of 2015. |
• | Franchising revenues for the three months ended March 31, 2016 totaled $78.7 million, an increase of 4 percent from the same period of 2015. |
• | Franchising margins for the three months ended March 31, 2016 were 61.6 percent, an increase of 10 basis points from the same period of 2015. |
• | Earnings before interest, taxes, depreciation and amortization (“EBITDA”) from franchising activities for the three months ended March 31, 2016 totaled $50.3 million compared to $49.0 million for the same period in 2015. EBITDA from franchising activities for the current period were impacted by approximately $2 million in the aggregate or $0.02 per share, net of tax, compared to our expectations for the quarter as a result of lower than expected increases in domestic system-wide revenue per available room (“RevPAR”) and higher than anticipated corporate development and litigation settlement costs. |
• | Domestic RevPAR increased 1.2 percent in the first quarter of 2016. Domestic RevPAR performance for the first quarter of 2016 was in line with the total industry results for the primary chain scale segments in which the company competes. Compared to its focused competitive set, the company’s Comfort family of brands achieved a RevPAR index gain estimated at 170 basis points for the three months ended March 31, 2016 compared to the same period in 2015. |
• | Effective income tax rate for the three months ended March 31, 2016 was 35.5 percent compared to 30.4 percent for the same period of 2015. Excluding discrete items, the effective income tax rates for the three months ended March 31, 2016 and 2015 were 33.5 percent and 31.8 percent, respectively. |
• | Equity in net loss of affiliates for the three months ended March 31, 2016 totaled $2.2 million, an increase of $1.2 million from the same period of 2015. Equity losses from affiliates primarily reflect losses during the ramp up period of recently opened or under renovation Cambria properties in major urban markets. |
• | Net income and diluted earnings per share (“EPS”) for the three months ended March 31, 2016 totaled $19.6 million and $0.35 per share, respectively, compared to $21.6 million and $0.37 per share in the prior year period. Compared to our previously published outlook for earnings per share for the first quarter of 2016 the impact of the discrete tax rate items and hotel equity investment performance was a reduction of approximately $0.02 per share. We anticipate the earnings per share impact of these two items will be mitigated during the balance of 2016 on account of the impact of certain other discrete tax items and performance improvement attributable to seasonality in the specific Cambria property markets. |
• | Domestic royalty fees for the three months ended March 31, 2016 totaled $60.5 million, an increase of 5 percent from the same period of 2015. |
• | Domestic and international units as of March 31, 2016 increased 1.1 percent and 2.3 percent, respectively, from March 31, 2015. Excluding the impact of our Comfort rejuvenation strategy, our domestic units under franchise at March 31, 2016 increased 4.6 percent from the prior year. |
• | Effective domestic royalty rate for the three months ended March 31, 2016 was 4.38 percent, an increase of 7 basis points from the same period of 2015. |
• | Domestic relicensing and contract renewal transactions totaled 107 for the three months ended March 31, 2016, an increase of 7 percent from the same period of 2015. |
• | The company’s domestic pipeline of hotels awaiting conversion, under construction or approved for development as of March 31, 2016 increased 12 percent from March 31, 2015. The new construction domestic pipeline for the company’s Comfort family of brands as of March 31, 2016 increased 29 percent from March 31, 2015. |
• | EBITDA from franchising activities for full-year 2016 are expected to range between $270 million and $274 million; |
• | Net domestic unit growth for 2016 is expected to be between 2% and 3%; |
• | RevPAR is expected to increase between 3% and 4% for second quarter and range between 3.75% and 4.50% for full-year 2016; and |
• | The effective royalty rate is expected to increase between 6 and 8 basis points for full-year 2016 as compared to full-year 2015. |
• | Net reductions in full-year 2016 EBITDA relating to our non-hotel franchising operations, which primarily relate to SkyTouch and vacation rental activities are expected to range between approximately $16 million and $19 million. |
• | The effective tax rate for continuing operations is expected to be approximately 32% and 33.5% for the second quarter and full-year 2016, respectively. Effective tax rates assume the adoption of Accounting Standards Update No 2016-09 “Compensation-Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting” (“ASU No. 2016-09”) during 2016 which requires that excess tax benefits and tax deficiencies related to stock compensation be recognized as income tax expense or benefit through the company’s income statement; and |
• | Diluted EPS estimates are based on the current number of shares outstanding and thus do not factor in any changes that may occur due to new equity grants or any further repurchases of common stock under the company’s share repurchase program. |
Choice Hotels International, Inc. | Exhibit 1 | |||||||||||||
Consolidated Statements of Income | ||||||||||||||
(Unaudited) | ||||||||||||||
Three Months Ended March 31, | ||||||||||||||
Variance | ||||||||||||||
2016 | 2015 | $ | % | |||||||||||
(In thousands, except per share amounts) | ||||||||||||||
REVENUES: | ||||||||||||||
Royalty fees | $ | 64,859 | $ | 62,431 | $ | 2,428 | 4 | % | ||||||
Initial franchise and relicensing fees | 5,156 | 5,717 | (561 | ) | (10 | )% | ||||||||
Procurement services | 5,796 | 4,807 | 989 | 21 | % | |||||||||
Marketing and reservation | 126,361 | 98,713 | 27,648 | 28 | % | |||||||||
Other | 4,946 | 3,577 | 1,369 | 38 | % | |||||||||
Total revenues | 207,118 | 175,245 | 31,873 | 18 | % | |||||||||
OPERATING EXPENSES: | ||||||||||||||
Selling, general and administrative | 35,119 | 32,438 | 2,681 | 8 | % | |||||||||
Depreciation and amortization | 2,765 | 2,690 | 75 | 3 | % | |||||||||
Marketing and reservation | 126,361 | 98,713 | 27,648 | 28 | % | |||||||||
Total operating expenses | 164,245 | 133,841 | 30,404 | 23 | % | |||||||||
Operating income | 42,873 | 41,404 | 1,469 | 4 | % | |||||||||
OTHER INCOME AND EXPENSES, NET: | ||||||||||||||
Interest expense | 11,092 | 10,179 | 913 | 9 | % | |||||||||
Interest income | (839 | ) | (346 | ) | (493 | ) | 142 | % | ||||||
Other (gains) and losses | 62 | (468 | ) | 530 | (113 | )% | ||||||||
Equity in net loss of affiliates | 2,180 | 1,005 | 1,175 | 117 | % | |||||||||
Total other income and expenses, net | 12,495 | 10,370 | 2,125 | 20 | % | |||||||||
Income before income taxes | 30,378 | 31,034 | (656 | ) | (2 | )% | ||||||||
Income taxes | 10,780 | 9,440 | 1,340 | 14 | % | |||||||||
Net income | $ | 19,598 | $ | 21,594 | $ | (1,996 | ) | (9 | )% | |||||
Basic earnings per share | $ | 0.35 | $ | 0.38 | $ | (0.03 | ) | (8 | )% | |||||
Diluted earnings per share | $ | 0.35 | $ | 0.37 | $ | (0.02 | ) | (5 | )% | |||||
Choice Hotels International, Inc. | Exhibit 2 | ||||||||||
Consolidated Balance Sheets | |||||||||||
(In thousands, except per share amounts) | March 31, | December 31, | |||||||||
2016 | 2015 | ||||||||||
(Unaudited) | |||||||||||
ASSETS | |||||||||||
Cash and cash equivalents | $ | 194,072 | $ | 193,441 | |||||||
Accounts receivable, net | 102,786 | 89,352 | |||||||||
Other current assets | 41,258 | 28,160 | |||||||||
Total current assets | 338,116 | 310,953 | |||||||||
Fixed assets and intangibles, net | 180,352 | 179,433 | |||||||||
Notes receivable, net of allowances | 92,477 | 82,572 | |||||||||
Investments in unconsolidated entities | 66,685 | 67,037 | |||||||||
Investments, employee benefit plans, at fair value | 17,802 | 17,674 | |||||||||
Other assets | 91,831 | 59,341 | |||||||||
Total assets | $ | 787,263 | $ | 717,010 | |||||||
LIABILITIES AND SHAREHOLDERS' DEFICIT | |||||||||||
Accounts payable | $ | 60,619 | $ | 64,431 | |||||||
Accrued expenses and other current liabilities | 46,616 | 70,807 | |||||||||
Deferred revenue | 112,076 | 71,587 | |||||||||
Current portion of long-term debt | 1,016 | 1,191 | |||||||||
Total current liabilities | 220,327 | 208,016 | |||||||||
Long-term debt | 892,447 | 812,945 | |||||||||
Deferred compensation & retirement plan obligations | 22,415 | 22,859 | |||||||||
Other liabilities | 37,939 | 69,089 | |||||||||
Total liabilities | 1,173,128 | 1,112,909 | |||||||||
Total shareholders' deficit | (385,865 | ) | (395,899 | ) | |||||||
Total liabilities and shareholders' deficit | $ | 787,263 | $ | 717,010 | |||||||
Choice Hotels International, Inc. | Exhibit 3 | ||||||
Consolidated Statements of Cash Flows | |||||||
(Unaudited) | |||||||
(In thousands) | Three Months Ended March 31, | ||||||
2016 | 2015 | ||||||
CASH FLOWS FROM OPERATING ACTIVITIES: | |||||||
Net income | $ | 19,598 | $ | 21,594 | |||
Adjustments to reconcile net income to net cash used by operating activities: | |||||||
Depreciation and amortization | 2,765 | 2,690 | |||||
(Gain) loss on sale of assets | 9 | (292 | ) | ||||
Provision for bad debts, net | 655 | 823 | |||||
Non-cash stock compensation and other charges | 3,354 | 2,509 | |||||
Non-cash interest and other (income) loss | 667 | 506 | |||||
Deferred income taxes | 6,198 | (233 | ) | ||||
Equity (earnings) losses from unconsolidated joint ventures, net of distributions received | 2,471 | 1,205 | |||||
Changes in assets and liabilities: | |||||||
Receivables | (14,473 | ) | (11,624 | ) | |||
Advances to/from marketing and reservation activities, net | (39,804 | ) | 4,626 | ||||
Forgivable notes receivable, net | (6,464 | ) | (13,371 | ) | |||
Accounts payable | (3,980 | ) | (1,152 | ) | |||
Accrued expenses and other current liabilities | (24,521 | ) | (24,052 | ) | |||
Income taxes payable/receivable | (1,798 | ) | 2,773 | ||||
Deferred revenue | 40,458 | 7,552 | |||||
Other assets | (7,238 | ) | (9,826 | ) | |||
Other liabilities | (842 | ) | 437 | ||||
NET CASH USED BY OPERATING ACTIVITIES | (22,945 | ) | (15,835 | ) | |||
CASH FLOWS FROM INVESTING ACTIVITIES: | |||||||
Investment in property and equipment | (5,306 | ) | (6,804 | ) | |||
Acquisitions of real estate | (25,389 | ) | — | ||||
Proceeds from sales of assets | 1,700 | 1,592 | |||||
Contributions to equity method investments | (4,293 | ) | (1,921 | ) | |||
Distributions from equity method investments | 67 | — | |||||
Purchases of investments, employee benefit plans | (896 | ) | (1,089 | ) | |||
Proceeds from sales of investments, employee benefit plans | 363 | 925 | |||||
Issuance of mezzanine and other notes receivable | (7,487 | ) | — | ||||
Collections of mezzanine and other notes receivable | 109 | 105 | |||||
Other items, net | (136 | ) | (77 | ) | |||
NET CASH USED BY INVESTING ACTIVITIES | (41,268 | ) | (7,269 | ) | |||
CASH FLOWS FROM FINANCING ACTIVITIES: | |||||||
Net borrowings pursuant to revolving credit facilities | 79,267 | 20,700 | |||||
Principal payments on long-term debt | (318 | ) | (3,082 | ) | |||
Purchase of treasury stock | (8,857 | ) | (6,227 | ) | |||
Dividends paid | (11,612 | ) | (11,710 | ) | |||
Excess tax benefits from stock-based compensation | 1,575 | 4,473 | |||||
Proceeds from exercise of stock options | 4,137 | 5,619 | |||||
NET CASH PROVIDED BY FINANCING ACTIVITIES | 64,192 | 9,773 | |||||
Net change in cash and cash equivalents | (21 | ) | (13,331 | ) | |||
Effect of foreign exchange rate changes on cash and cash equivalents | 652 | (1,004 | ) | ||||
Cash and cash equivalents at beginning of period | 193,441 | 214,879 | |||||
CASH AND CASH EQUIVALENTS AT END OF PERIOD | $ | 194,072 | $ | 200,544 | |||
CHOICE HOTELS INTERNATIONAL, INC. | Exhibit 4 | |||||||||||||||||||||||||||||||
SUPPLEMENTAL OPERATING INFORMATION | ||||||||||||||||||||||||||||||||
DOMESTIC HOTEL SYSTEM | ||||||||||||||||||||||||||||||||
(UNAUDITED) | ||||||||||||||||||||||||||||||||
For the Three Months Ended March 31, 2016 | For the Three Months Ended March 31, 2015 | Change | ||||||||||||||||||||||||||||||
Average Daily | Average Daily | Average Daily | ||||||||||||||||||||||||||||||
Rate | Occupancy | RevPAR | Rate | Occupancy | RevPAR | Rate | Occupancy | RevPAR | ||||||||||||||||||||||||
Comfort Inn | $ | 85.39 | 57.7 | % | $ | 49.27 | $ | 82.90 | 57.4 | % | $ | 47.55 | 3.0 | % | 30 | bps | 3.6 | % | ||||||||||||||
Comfort Suites | 92.40 | 64.1 | % | 59.26 | 90.12 | 64.4 | % | 58.02 | 2.5 | % | (30 | ) | bps | 2.1 | % | |||||||||||||||||
Sleep | 77.71 | 58.7 | % | 45.61 | 76.44 | 59.5 | % | 45.48 | 1.7 | % | (80 | ) | bps | 0.3 | % | |||||||||||||||||
Quality | 72.23 | 52.2 | % | 37.72 | 70.18 | 52.6 | % | 36.93 | 2.9 | % | (40 | ) | bps | 2.1 | % | |||||||||||||||||
Clarion | 75.90 | 50.1 | % | 38.06 | 75.30 | 51.5 | % | 38.74 | 0.8 | % | (140 | ) | bps | (1.8 | )% | |||||||||||||||||
Econo Lodge | 55.99 | 47.3 | % | 26.46 | 54.41 | 47.9 | % | 26.06 | 2.9 | % | (60 | ) | bps | 1.5 | % | |||||||||||||||||
Rodeway | 57.77 | 51.0 | % | 29.47 | 53.85 | 52.7 | % | 28.40 | 7.3 | % | (170 | ) | bps | 3.8 | % | |||||||||||||||||
MainStay | 72.91 | 57.9 | % | 42.23 | 73.58 | 66.4 | % | 48.85 | (0.9 | )% | (850 | ) | bps | (13.6 | )% | |||||||||||||||||
Suburban | 48.28 | 73.0 | % | 35.26 | 46.48 | 74.1 | % | 34.42 | 3.9 | % | (110 | ) | bps | 2.4 | % | |||||||||||||||||
Ascend Hotel Collection | 115.55 | 53.7 | % | 62.01 | 113.19 | 60.8 | % | 68.79 | 2.1 | % | (710 | ) | bps | (9.9 | )% | |||||||||||||||||
Total | $ | 76.47 | 55.0 | % | $ | 42.05 | $ | 74.59 | 55.7 | % | $ | 41.57 | 2.5 | % | (70 | ) | bps | 1.2 | % | |||||||||||||
For the Quarter Ended | ||||||||||||||||||||||||||||||||
March 31, 2016 | March 31, 2015 | |||||||||||||||||||||||||||||||
System-wide effective royalty rate | 4.38% | 4.31% | ||||||||||||||||||||||||||||||
CHOICE HOTELS INTERNATIONAL, INC. | Exhibit 5 | |||||||||||||||||||||||
SUPPLEMENTAL HOTEL AND ROOM SUPPLY DATA | ||||||||||||||||||||||||
(UNAUDITED) | ||||||||||||||||||||||||
March 31, 2016 | March 31, 2015 | Variance | ||||||||||||||||||||||
Hotels | Rooms | Hotels | Rooms | Hotels | Rooms | % | % | |||||||||||||||||
Comfort Inn | 1,143 | 88,294 | 1,234 | 95,281 | (91 | ) | (6,987 | ) | (7.4 | )% | (7.3 | )% | ||||||||||||
Comfort Suites | 566 | 43,669 | 576 | 44,519 | (10 | ) | (850 | ) | (1.7 | )% | (1.9 | )% | ||||||||||||
Sleep | 379 | 27,139 | 368 | 26,533 | 11 | 606 | 3.0 | % | 2.3 | % | ||||||||||||||
Quality | 1,394 | 111,124 | 1,292 | 104,654 | 102 | 6,470 | 7.9 | % | 6.2 | % | ||||||||||||||
Clarion | 172 | 23,893 | 180 | 25,380 | (8 | ) | (1,487 | ) | (4.4 | )% | (5.9 | )% | ||||||||||||
Econo Lodge | 853 | 52,784 | 853 | 52,602 | — | 182 | — | % | 0.3 | % | ||||||||||||||
Rodeway | 519 | 28,931 | 475 | 26,158 | 44 | 2,773 | 9.3 | % | 10.6 | % | ||||||||||||||
MainStay | 54 | 4,019 | 46 | 3,571 | 8 | 448 | 17.4 | % | 12.5 | % | ||||||||||||||
Suburban | 59 | 6,634 | 63 | 7,048 | (4 | ) | (414 | ) | (6.3 | )% | (5.9 | )% | ||||||||||||
Ascend Hotel Collection | 112 | 9,378 | 110 | 9,405 | 2 | (27 | ) | 1.8 | % | (0.3 | )% | |||||||||||||
Cambria hotel & suites | 25 | 3,113 | 22 | 2,642 | 3 | 471 | 13.6 | % | 17.8 | % | ||||||||||||||
Domestic Franchises | 5,276 | 398,978 | 5,219 | 397,793 | 57 | 1,185 | 1.1 | % | 0.3 | % | ||||||||||||||
International Franchises | 1,169 | 110,984 | 1,143 | 105,498 | 26 | 5,486 | 2.3 | % | 5.2 | % | ||||||||||||||
Total Franchises | 6,445 | 509,962 | 6,362 | 503,291 | 83 | 6,671 | 1.3 | % | 1.3 | % |
Exhibit 6 | ||||||||||||||||||||||||
CHOICE HOTELS INTERNATIONAL, INC. | ||||||||||||||||||||||||
SUPPLEMENTAL INFORMATION BY BRAND | ||||||||||||||||||||||||
DEVELOPMENT RESULTS -- DOMESTIC NEW HOTEL CONTRACTS | ||||||||||||||||||||||||
(UNAUDITED) | ||||||||||||||||||||||||
For the Three Months Ended March 31, 2016 | For the Three Months Ended March 31, 2015 | % Change | ||||||||||||||||||||||
New Construction | Conversion | Total | New Construction | Conversion | Total | New Construction | Conversion | Total | ||||||||||||||||
Comfort Inn | 6 | 4 | 10 | 4 | 7 | 11 | 50% | (43)% | (9)% | |||||||||||||||
Comfort Suites | 2 | — | 2 | 5 | 2 | 7 | (60)% | (100)% | (71)% | |||||||||||||||
Sleep | 2 | — | 2 | 5 | — | 5 | (60)% | NM | (60)% | |||||||||||||||
Quality | — | 23 | 23 | 2 | 29 | 31 | (100%) | (21)% | (26)% | |||||||||||||||
Clarion | 1 | 3 | 4 | — | 3 | 3 | NM | —% | 33% | |||||||||||||||
Econo Lodge | — | 14 | 14 | — | 9 | 9 | NM | 56% | 56% | |||||||||||||||
Rodeway | — | 10 | 10 | — | 14 | 14 | NM | (29)% | (29)% | |||||||||||||||
MainStay | 1 | — | 1 | 4 | — | 4 | (75)% | NM | (75)% | |||||||||||||||
Suburban | — | — | — | — | 2 | 2 | NM | (100)% | (100)% | |||||||||||||||
Ascend Hotel Collection | 1 | 1 | 2 | 1 | 10 | 11 | —% | (90)% | (82)% | |||||||||||||||
Cambria hotel & suites | 2 | — | 2 | 2 | — | 2 | —% | NM | —% | |||||||||||||||
Total Domestic System | 15 | 55 | 70 | 23 | 76 | 99 | (35)% | (28)% | (29)% | |||||||||||||||
Exhibit 7 | |||||||||||||||||||||||||||||||||
CHOICE HOTELS INTERNATIONAL, INC. | |||||||||||||||||||||||||||||||||
DOMESTIC PIPELINE OF HOTELS UNDER CONSTRUCTION, AWAITING CONVERSION OR APPROVED FOR DEVELOPMENT | |||||||||||||||||||||||||||||||||
(UNAUDITED) | |||||||||||||||||||||||||||||||||
A hotel in the domestic pipeline does not always result in an open and operating hotel due to various factors. | |||||||||||||||||||||||||||||||||
Variance | |||||||||||||||||||||||||||||||||
March 31, 2016 Units | March 31, 2015 Units | Conversion | New Construction | Total | |||||||||||||||||||||||||||||
Conversion | New Construction | Total | Conversion | New Construction | Total | Units | % | Units | % | Units | % | ||||||||||||||||||||||
Comfort Inn | 35 | 84 | 119 | 33 | 62 | 95 | 2 | 6% | 22 | 35% | 24 | 25% | |||||||||||||||||||||
Comfort Suites | 3 | 92 | 95 | 3 | 74 | 77 | — | —% | 18 | 24% | 18 | 23% | |||||||||||||||||||||
Sleep Inn | — | 76 | 76 | 2 | 73 | 75 | (2 | ) | (100)% | 3 | 4% | 1 | 1% | ||||||||||||||||||||
Quality | 47 | 5 | 52 | 54 | 6 | 60 | (7 | ) | (13)% | (1 | ) | (17)% | (8 | ) | (13)% | ||||||||||||||||||
Clarion | 7 | 3 | 10 | 10 | 2 | 12 | (3 | ) | (30)% | 1 | 50% | (2 | ) | (17)% | |||||||||||||||||||
Econo Lodge | 26 | 4 | 30 | 28 | 4 | 32 | (2 | ) | (7)% | — | —% | (2 | ) | (6)% | |||||||||||||||||||
Rodeway | 40 | 2 | 42 | 34 | 3 | 37 | 6 | 18% | (1 | ) | (33)% | 5 | 14% | ||||||||||||||||||||
MainStay | — | 55 | 55 | 1 | 47 | 48 | (1 | ) | (100)% | 8 | 17% | 7 | 15% | ||||||||||||||||||||
Suburban | 4 | 8 | 12 | 6 | 12 | 18 | (2 | ) | (33)% | (4 | ) | (33)% | (6 | ) | (33)% | ||||||||||||||||||
Ascend Hotel Collection | 27 | 20 | 47 | 22 | 20 | 42 | 5 | 23% | — | —% | 5 | 12% | |||||||||||||||||||||
Cambria hotel & suites | 5 | 39 | 44 | — | 23 | 23 | 5 | NM | 16 | 70% | 21 | 91% | |||||||||||||||||||||
194 | 388 | 582 | 193 | 326 | 519 | 1 | 1% | 62 | 19% | 63 | 12% | ||||||||||||||||||||||
CHOICE HOTELS INTERNATIONAL, INC. | Exhibit 8 | |||||||||
SUPPLEMENTAL NON-GAAP FINANCIAL INFORMATION | ||||||||||
(UNAUDITED) | ||||||||||
CALCULATION OF FRANCHISING REVENUES AND FRANCHISING MARGINS | ||||||||||
(dollar amounts in thousands) | Three Months Ended March 31, | |||||||||
2016 | 2015 | |||||||||
Franchising Revenues: | ||||||||||
Total Revenues | $ | 207,118 | $ | 175,245 | ||||||
Adjustments: | ||||||||||
Marketing and reservation revenues | (126,361 | ) | (98,713 | ) | ||||||
Non-franchising activities | (2,029 | ) | (603 | ) | ||||||
Franchising Revenues | $ | 78,728 | $ | 75,929 | ||||||
Franchising Margins: | ||||||||||
Operating Margin: | ||||||||||
Total Revenues | $ | 207,118 | $ | 175,245 | ||||||
Operating Income | 42,873 | 41,404 | ||||||||
Operating Margin | 20.7 | % | 23.6 | % | ||||||
Franchising Margin: | ||||||||||
Franchising Revenues | $ | 78,728 | $ | 75,929 | ||||||
Operating Income | $ | 42,873 | $ | 41,404 | ||||||
Non-franchising activities operating loss | 5,656 | 5,301 | ||||||||
$ | 48,529 | $ | 46,705 | |||||||
Franchising Margins | 61.6 | % | 61.5 | % | ||||||
CALCULATION OF FRANCHISING SELLING, GENERAL AND ADMINISTRATION EXPENSES | ||||||||||
(dollar amounts in thousands) | Three Months Ended March 31, | |||||||||
2016 | 2015 | |||||||||
Total Selling, General and Administrative Expenses | $ | 35,119 | $ | 32,438 | ||||||
Non-franchising activities | (6,670 | ) | (5,495 | ) | ||||||
Franchising Selling, General and Administration Expenses | $ | 28,449 | $ | 26,943 | ||||||
CALCULATION OF EARNINGS BEFORE INTEREST, TAXES, DEPRECIATION AND AMORTIZATION ("EBITDA") | ||||||||||
(dollar amounts in thousands) | ||||||||||
Three Months Ended March 31, | ||||||||||
2016 | 2015 | |||||||||
Income from continuing operations, net of income taxes | $ | 19,598 | $ | 21,594 | ||||||
Income taxes | 10,780 | 9,440 | ||||||||
Interest expense | 11,092 | 10,179 | ||||||||
Interest income | (839 | ) | (346 | ) | ||||||
Other (gains) and losses | 62 | (468 | ) | |||||||
Equity in net loss of affiliates | 2,180 | 1,005 | ||||||||
Depreciation and amortization | 2,765 | 2,690 | ||||||||
EBITDA | $ | 45,638 | $ | 44,094 | ||||||
Franchising | $ | 50,279 | $ | 48,986 | ||||||
SkyTouch & other | (4,641 | ) | (4,892 | ) | ||||||
$ | 45,638 | $ | 44,094 | |||||||