Shares of Choice Hotels International (NYSE:CHH) are 1.5% higher on Tuesday as a beat on Q4 profit overshadowed lower-than-expected revenue and downbeat profit guidance for 2024.
The company’s CEO also reassured investors that the company remains committed to its merger with Wyndham Hotels & Resorts (WH). Choice (CHH) recently nominated eight individuals to replace Wyndham’s (WH) current board.
The hotel operator earned a profit of $1.44 per share, a 14% increase from the same quarter last year and 9 cents above the consensus forecast. Sales, however, were down 1% to $358.4M, missing expectations by $11.21M. Adjusted EBITDA rose 11% to $125M year-over-year.
Q4 Revenue per available room, or RevPar, fell 390 basis points and is forecasted to be flat to 2% higher in 2024. Domestically, RevPar was up 13.1% in Q4 versus the same quarter last year.
Total available liquidity consisting of cash and available borrowings through its revolving credit facility was ~$650M. Cash and cash equivalents fell to $26.7M from $41.6M in 2023.
On the development front, Choice (CHH) opened 8 hotels per week in Q4 for a total of 263 hotel openings in 2023, a 13% improvement from last year.
For 2024, Choice Hotels (CHH) expects adjusted EPS to be between $6.30 to $6.60 per shares, below the Street estimate of $6.75. Adjusted EBITDA for 2024 is expected to be in the range of $580M to $600M compared to $540.5M in 2023.
