Comfort Inn 2011 Annual Report Download - page 35

Table of Contents
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Company results (in millions, except per share data)
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Total Revenues $615.5
$ 641.7
$564.2
$596.1
$ 638.8
Net Income $111.3
$100.2
$ 98.3
$107.4
$110.4
Basic Earnings per Share $ 1.72
$1.61
$ 1.64
$1.80
$1.86
Diluted Earnings per Share $1.69
$1.59
$ 1.63
$1.80
$1.85
Total Assets $328.4
$328.2
$340.0
$411.7
$447.7
Long-Term Debt $272.4
$284.4
$ 277.7
$251.6
$ 252.0
Cash Dividends Declared Per Common Share $0.64
$0.71
$0.74
$0.74
$0.74
Matters that affect the comparability of our annual results are as follows:
•Net income in 2007 included termination benefit expense totaling $4.3 million resulting from the termination of certain employees. This
represented a decline in diluted EPS of $0.04.
•Net income in 2008 included expenses related to the acceleration of the Company’s management succession plan totaling $6.6 million,
termination benefits for non-executive employees totaling $3.5 million and the establishment of reserves for impaired notes receivable totaling
$7.6 million. These items represented a decline in diluted EPS of $0.18.
•Net income in 2009 included termination benefits expense totaling $4.6 million, $1.2 million of additional expenses due to the curtailment of the
Company’s Supplemental Executive Retirement Plan resulting from the freezing of benefits payable under the plan and a $1.5 million loss
related to a sublease of office space and related impairment charges to the space’s leasehold improvements. These items represented a decline in
diluted EPS of $0.08.
•Net income in 2010 included termination benefits expense totaling $1.7 million resulting from the termination of certain employees. In addition,
the Company’s income tax expense included an adjustment of $3.3 million to our deferred tax assets and the identification of $1.6 million of
additional federal income tax benefits, partially offset by an increase of $1.6 million related to the identification of unrecognized tax positions.
These items represented an increase in diluted EPS of $0.04.
•Net income in 2011 was reduced by termination benefits totaling $4.4 million resulting from the termination of certain employees and a $1.8
million loss on assets held for sale resulting from the Company reducing the carrying amount of a parcel of land held for sale to its estimated
fair value. In addition, the Company's income tax expense was reduced due to the identification of $1.4 million of changes in unrecognized tax
positions and the identification of $2.8 million of additional federal tax benefits. Additionally, an adjustment to our current federal taxes payable
of $1.4 million reduced our effective tax rate. These items represented a net increase in diluted EPS of $0.16.
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The following Management’s Discussion and Analysis (“MD&A”) is intended to help the reader understand Choice Hotels International, Inc. and its
subsidiaries (together the “Company”). MD&A is provided as a supplement to—and should be read in conjunction with—our consolidated financial
statements and the accompanying notes.
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We are a hotel franchisor with franchise agreements representing 6,178 hotels open and 490 hotels under construction, awaiting conversion or approved
for development as of December 31, 2011, with 497,205 rooms and 39,675 rooms, respectively, in 49 states, the District of Columbia and over 35 countries
and territories outside the United States. Our brand names include Comfort Inn, Comfort Suites, Quality, Clarion, Ascend Collection, Sleep Inn, Econo
Lodge, Rodeway Inn, MainStay Suites, Suburban Extended Stay Hotel and Cambria Suites (collectively, the “Choice brands”).
The Company's domestic operations are conducted solely through direct franchising relationships while its international franchise operations are
conducted through a combination of direct franchising and master franchising relationships. Master
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