Dive Brief:
- Choice Hotels International posted a quarterly record for total revenues and a 10% global rooms pipeline increase in the second quarter of 2023, the company reported Tuesday.
- In Q2, revenues totaled $427.4 million, up 16% from the same time last year. RevPAR increased 50 basis points compared to the same period of 2022, driven by a 2.8% increase in average daily rate. The company's second quarter 2023 occupancy levels exceeded 60%.
- Choice raised its outlook for full-year 2023 adjusted EBITDA. On the company’s earnings call, President and CEO Patrick Pacious credited success in integrating Radisson Hotels Americas, strong conversion activity and a growing pipeline for the company’s growth.
Dive Insight:
Choice’s integration of Radisson Americas — which it acquired in 2022 — into its network and loyalty program was completed ahead of schedule this quarter.
“The speed with which we have integrated Radisson Americas is truly remarkable,” Pacious said on an earnings call with analysts, noting the integration has widened Choice’s footprint in the Americas region, expanded loyalty offerings and boosted revenues through a co-branded credit card.
Pacious also noted strong momentum in conversion activity, which he expects to “remain robust for the foreseeable future.”
Choice’s pipeline represents what Pacious called “a healthy mix” of conversion and ground-up construction properties. Openings continued at a rapid clip in Q2, with the company opening an average of four hotels per week in the quarter. Opening activity was strong across all the company’s segments, Pacious added.
In particular, the company increased openings in the first half of 2023 in the upscale segment by 83%, the midscale segment by 42%, the extended-stay segment by 50% and the economy segment by 11%, as compared to the same period of 2022.
Choice brands also fared well in a recent customer satisfaction survey by J.D. Power, which named the company’s upscale Cambria brand highest in its segment. Choice is currently expanding the Cambria brand across the country, and has either planned or opened hotels in markets including Savannah, Georgia; Detroit; Portland, Oregon; and Copper Mountain, Colorado.
J.D. Power ranked Choice’s economy extended stay brand WoodSpring Suites highest in customer satisfaction within its segment, as well. Choice is also expanding the WoodSpring Suites pipeline across the U.S.
