Comfort Inn 2007 Annual Report Download - page 92

Download and view the complete annual report

Please find page 92 of the 2007 Comfort Inn annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.

Page out of 96

  • 1
  • 2
  • 3
  • 4
  • 5
  • 6
  • 7
  • 8
  • 9
  • 10
  • 11
  • 12
  • 13
  • 14
  • 15
  • 16
  • 17
  • 18
  • 19
  • 20
  • 21
  • 22
  • 23
  • 24
  • 25
  • 26
  • 27
  • 28
  • 29
  • 30
  • 31
  • 32
  • 33
  • 34
  • 35
  • 36
  • 37
  • 38
  • 39
  • 40
  • 41
  • 42
  • 43
  • 44
  • 45
  • 46
  • 47
  • 48
  • 49
  • 50
  • 51
  • 52
  • 53
  • 54
  • 55
  • 56
  • 57
  • 58
  • 59
  • 60
  • 61
  • 62
  • 63
  • 64
  • 65
  • 66
  • 67
  • 68
  • 69
  • 70
  • 71
  • 72
  • 73
  • 74
  • 75
  • 76
  • 77
  • 78
  • 79
  • 80
  • 81
  • 82
  • 83
  • 84
  • 85
  • 86
  • 87
  • 88
  • 89
  • 90
  • 91
  • 92
  • 93
  • 94
  • 95
  • 96

CHOICE HOTELS INTERNATIONAL, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(continued)
No. 112 “Employer’ s Accounting for Post-employment Benefits”. At December 31, 2007, approximately $2.0 million of
termination benefits remained and were included in current liabilities in the Company’ s consolidated financial statements.
27. Selected Quarterly Financial Data – (Unaudited)
First
Quarter
Second
Quarter
Third
Quarter
Fourth
Quarter
2007
(In thousands, except per share data)
Revenues ............................................................................ $ 114,929 $ 156,491 $ 175,099 $ 168,975 $ 615,494
Operating income.............................................................. $ 27,386 $ 47,363 $ 62,359
$ 48,091 $ 185,199
Income before income taxes ............................................. $ 25,184 $ 46,048 $ 59,363
$ 43,291 $ 173,886
Net income ......................................................................... $ 16,315 $ 28,645 $ 38,394
$ 27,947 $ 111,301
Per basic share:
Net income................................................................ $ 0.25 $ 0.44 $ 0.60 $ 0.45 $ 1.73
Per diluted share:
Net income................................................................ $ 0.24 $ 0.43 $ 0.59 $ 0.44 $ 1.70
First
Quarter
Second
Quarter
Third
Quarter
Fourth
Quarter
2006
(In thousands, except per share data)
Revenues............................................................................. $ 108,255 $ 139,370 $ 149,779 $ 142,499 $ 539,903
Operating income................................................................ $ 30,073 $ 42,114 $ 54,552
$ 39,886 $ 166,625
Income before income taxes ............................................... $ 26,995 $ 37,684 $ 52,263
$ 38,336 $ 155,278
Net income.......................................................................... $ 17,665 $ 24,136 $ 46,357
$ 24,629 $ 112,787
Per basic share:
Net income ................................................................ $ 0.27 $ 0.37 $ 0.71 $ 0.37 $ 1.72
Per diluted share:
Net income ................................................................ $ 0.26 $ 0.36 $ 0.69 $ 0.37 $ 1.68
Quarterly revenues reported in the table above have been reclassified from prior quarter Form 10-Q filings to reflect
the reclassification of certain marketing and reservation revenues. The reclassification of revenues had no effect on
reported operating income, income before income taxes, net income or earnings per share.
The matters which effect the comparability of our quarterly results include seasonality, executive termination
benefits recorded in the first quarter of 2007, the reversal of reserves for income tax contingencies in the third and fourth
quarter of 2006 and a loss on extinguishment of debt in the second quarter 2006.
28. Impact of Recently Issued Accounting Standards
In September 2006, the FASB issued SFAS No. 157, “Fair Value Measurements” (“SFAS No. 157”) which defines
fair value, establishes a framework for measuring fair value in generally accepted accounting principles and expands
disclosures about fair value measurements. This Statement is effective for financial statements issued for fiscal years
beginning after November 15, 2007 and interim periods within those fiscal years. In November 2007, the FASB agreed to
partially defer the effective date, for one year, of SFAS No. 157 for non-financial assets and liabilities, except those that
are recognized or disclosed at fair value in the financial statements on a recurring basis. The Company is currently
evaluating the impact that SFAS No. 157 will have on our consolidated financial statements.
In February 2007, the FASB issued SFAS No. 159, “The Fair Value for Financial Assets and Financial Liabilities”
(“SFAS No. 159”) which provides reporting entities an option to report certain financial instruments and other items at
fair value that are not currently required to be measured at fair value. SFAS No. 159 is effective as of the beginning of a
reporting entity’ s first fiscal year beginning after November 15, 2007. The Company does not expect to elect the fair value
measurement option of any financial assets or liabilities at the present time.
In December 2007, the FASB issued SFAS No. 160 (“SFAS No. 160”), “Noncontrolling Interests in Consolidated
Financial Statements—An Amendment of ARB No. 51”. SFAS No. 160 establishes new accounting and reporting
standards for the non-controlling interest in a subsidiary and for the deconsolidation of a subsidiary. SFAS No. 160 is
effective for fiscal years beginning on or after December 15, 2008. The Company is currently evaluating the impact, if
any, the adoption of this statement will have on our consolidated financial statements.
90