Choice Hotels International’s fourth-quarter occupancy,
average daily rate and revenue per available room each dropped year over year,
the company reported Tuesday, as its executives on a conference call renewed
Choice’s commitment to its hostile pursuit of Wyndham Hotels & Resorts.
Choice president and CEO Patrick Pacious said “we
remain committed to this compelling, pro-competitive combination,” and
said the company had been in contact with U.S. federal regulators, including
the Federal Trade Commission, about the potential
acquisition. Wyndham’s board of directors continues to oppose the deal, and
Wyndham president and CEO Geoff Ballotti last
week called Choice’s pursuit a “distraction.”
The door remains open to Wyndham to engage in a constructive private dialogue with us. And we believe there’s opportunity to improve our offer if they’ll engage…”
Choice Hotels’ CEO Patrick Pacious
“Unfortunately, Wyndham’s board really just continues
to refuse to engage,” Pacious said Tuesday during an earnings call.
“The door remains open to Wyndham to engage in a constructive private
dialogue with us. And we believe there’s opportunity to improve our offer if
they’ll engage with us, that’s the first thing. And the second is, allow us to
undertake some due diligence.”
Choice has nominated a slate of candidates for election to
Wyndham’s board at Wyndham’s next annual meeting of stockholders.
Beyond Wyndham, Pacious said the company was open to other
acquisitions. “We remain committed to value-creating M&A, focusing on
opportunities like Wyndham, where we can both improve the profitability of the
existing franchisees as well as grow the combined portfolio.”
Q4 Performance
Choice’s domestic fourth-quarter revenue per room declined
3.9 percent year over year to $48.36, while occupancy declined to 52.8 percent
from 54.1 percent one year prior, and average daily rate declined 1.7 percent
to $91.51.
Choice projected its full-year 2024 RevPAR would range from
steady year over year to an increase of 2 percent, below
the projections of some industry forecasters.
Choice CFO Scott Oaksmith on the call said that the
fourth-quarter RevPAR decline reflected “tougher year-over-year comps, as
we were the first hotel company to return to and significantly exceed
pre-pandemic RevPAR levels,” adding that full-year 2023 domestic RevPAR
was 12.7 percent higher than in 2019 and up 0.1 percent year over year.
Oaksmith suggested Choice’s 2024 RevPAR projection is “a
little bit conservative” and said that “we do expect business travel
to come back and get back to 2019 levels in 2024 and 2025.”
Total fourth-quarter revenue declined 1 percent year over
year to about $358.4 million, while net income declined to about $29 million
from $55.5 million one year prior. Full-year 2023 revenue increased 10 percent
year over year to $1.54 billion, while net income declined 22 percent to $258.5
million.
Choice said its global development pipeline as of Dec. 31
was 105,000 rooms, up 6 percent from three months prior.
