CHH - Choice Hotels International Inc. (CHH) Q4 2023 Earnings Call Transcript
2024-02-20 12:18:03 ET
Choice Hotels International, Inc. (CHH)
Q4 2023 Earnings Conference Call
February 20, 2024 10:00 a.m. ET
Company Participants
Allie Summers - Senior Director and Investor Relations
Patrick Pacious - President and Chief Executive Officer
Scott Oaksmith - Chief Financial Officer
Dominic Dragisich - Executive Vice President, Operations and Chief Global Brand Officer
Conference Call Participants
Shaun Kelley - Bank of America
Michael Bellisario - Robert W. Baird
Stephen Grambling - Morgan Stanley
Robin Farley - UBS Securities
Joe Greff - J.P. Morgan
Meredith Jensen - HSBC
Brandt Montour - Barclays
Presentation
Allie Summers
[Abrupt Start] -- our remarks as part of our fourth quarter and full-year 2023 earnings press release, which is posted on our Web site at choicehotels.com under the Investor Relations section.
This morning, Pat Pacious, our President and Chief Executive Officer will speak to our fourth quarter operating results and full-year highlights; while Scott Oaksmith, Chief Financial Officer, will discuss our financial performance and 2024 outlook. Joining us also today for the Q&A portion of the call is Dom Dragisich, Executive Vice President, Operations and Chief Global Brand Officer. Following our prepared remarks, we'll be glad to answer your questions.
And with that, I'll turn the call over to Pat.
Patrick Pacious
Thank you, Allie, and good morning, everyone. We appreciate you taking the time to join us. 2023 was a year of accelerating growth. We delivered record financial performance as we exceeded the top end of our guidance with a 13% year-over-year increase in adjusted EBITDA to $540.5 million, a 16% year-over-year increase in adjusted EPS to $6.11, and unit growth ahead of our expectations led by our successful strategy of adding hotels that generate higher royalties per unit. In 2023, we significantly expanded our rewards program, increased our geographic reach, unlocked new value to our platform capabilities, and created step function growth through the rapid completion of the Radisson Americas' integration.
This positive momentum combined with projected unit growth acceleration and supported by our superior hotel conversion capability gives us confidence in achieving our expected adjusted EBITDA growth of 10% in 2024, which is captured in our current guidance range. I will begin today by discussing what drove our impressive fourth quarter and full-year 2023 results, and then discuss our proposal to acquire Wyndham Hotels & Resorts, because it is the growth drivers of our current business that underpin the confidence we have in our ability to unlock the significant value for shareholders, franchisees, and guests that we see in the combination with Wyndham.
Our distinct growth strategy, supported by our best-in-class franchising business engine drove adjusted full-year 2023 EBITDA 13% higher than the prior year, and 45% higher than in 2019. This continues our consistent track record of delivering double-digit profitability growth year after year. We have positioned the company to build on this performance in 2024, and beyond, as we continue to grow our franchise business with hotels that generate higher royalties per unit, while leveraging the investments we've made in our systems to further improve the franchisees' profitability. In line with our previously communicated outlook, we expect to grow our full-year 2024 adjusted EBITDA to $590 million at the midpoint of the guidance range....
Choice Hotels International, Inc. (CHH) Q4 2023 Earnings Call Transcript