Comfort Inn 2014 Annual Report Download - page 4

Table of Contents
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Throughout this report, we refer to Choice Hotels International, Inc., together with its subsidiaries as "Choice," "we," "us" or the "Company".
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Certain matters discussed in this report constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of
1995. Generally, our use of words such as "expect," "estimate," "believe," "anticipate," "should," "will," "forecast," "plan," "project," "assume" or similar words
of futurity identify such forward-looking statements. These forward-looking statements are based on management's current beliefs, assumption and
expectations regarding future events, which in turn are based on information currently available to management. Such statements may relate to projections of
the Company’s revenue, earnings and other financial and operational measures, Company debt levels, ability to repay outstanding indebtedness, payment of
dividends, and future operations, among other matters. We caution you not to place undue reliance on any such forward-looking statements. Forward-looking
statements do not guarantee future performance and involve known and unknown risks, uncertainties and other factors.
Several factors could cause actual results, performance or achievements of the Company to differ materially from those expressed in or contemplated by
the forward-looking statements. Such risks include, but are not limited to, changes to general, domestic and foreign economic conditions; foreign currency
fluctuations; operating risks common in the lodging and franchising industries; changes to the desirability of our brands as viewed by hotel operators and
customers; changes to the terms or termination of our contracts with franchisees and our relationships with our franchisees; our ability to keep pace with
improvements in technology utilized for marketing and reservations systems and other operating systems; our ability to grow our franchise system; exposure
to risks relating to development activities; fluctuations in the supply and demand for hotels rooms; the level of acceptance of alternative growth strategies we
may implement; operating risks associated with our international operations; the outcome of litigation; and our ability to effectively manage our
indebtedness. These and other risk factors are discussed in detail in Item 1A. "Risk Factors" of this report. We undertake no obligation to publicly update or
revise any forward-looking statement, whether as a result of new information, future events or otherwise, except as required by law.
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We file annual, quarterly and current reports, proxy statements and other information with the Securities and Exchange Commission ("SEC"). Our SEC
filings are available to the public over the internet at the SEC’s web site at http://www.sec.gov. Our SEC filings are also available free of charge on our
website at http://www.choicehotels.com as soon as reasonably practicable following the time that they are filed with or furnished to the SEC. You may also
read and copy any document we file with the SEC at its public reference room located at 100 F Street, NE Washington DC 20549. Please call the SEC at 1-
800-SEC-0330 for further information on its public reference room.
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Overview
We are one of the largest hotel franchisors in the world with 6,379 hotels open and 603 hotels under construction, awaiting conversion or approved for
development as of December 31, 2014 representing 505,278 rooms open and 47,951 rooms under construction, awaiting conversion or approved for
development in 50 states, the District of Columbia and over 35 countries and territories outside the United States. Choice franchises lodging properties under
the following proprietary brand names: Comfort Inn®, Comfort Suites®, Quality®, Clarion®, Sleep Inn®, Econo Lodge®, Rodeway Inn®, MainStay Suites®,
Suburban Extended Stay Hotel®, Cambria® hotels & suites, and Ascend Hotel Collection® (collectively, the "Choice brands").
We operate in two reportable segments encompassing our hotel franchising business and our SkyTouch Technology ("SkyTouch") division. SkyTouch
is a division of the Company that develops and markets cloud-based technology products, including inventory management, pricing and connectivity to
third party channels, to hoteliers not under franchise agreements with the Company. SkyTouch's technology products are based on the Company's
choiceAdvantage property management system which is utilized by over 5,700 of the Company's franchised hotels. SkyTouch was announced to the public
in March 2013 and represents less than 1% and 5% of the Company's total revenues and operating expenses, respectively, for the year ended December 31,
2014.
The Company's domestic franchising operations are conducted through direct franchising relationships while its international franchise operations are
conducted through a combination of direct franchising and master franchising relationships. With a focus on hotel franchising instead of ownership, we
benefit from the economies of scale inherent in the franchising business. The fee and cost structure of our business provides opportunities to improve
operating results by increasing the number of franchised hotel rooms and effective royalty rates of our franchise contracts resulting in increased
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