Choice Hotels International (CHH) has reported 35.82 percent jump in profit for the quarter ended Mar. 31, 2017. The company has earned $28.74 million, or $0.51 a share in the quarter, compared with $21.16 million, or $0.37 a share for the same period last year.
Revenue during the quarter dropped 4.45 percent to $197.90 million from $207.12 million in the previous year period. Total expenses were 73.47 percent of quarterly revenues, down from 79.30 percent for the same period last year. This has led to an improvement of 583 basis points in operating margin to 26.53 percent.
Operating income for the quarter was $52.51 million, compared with $42.87 million in the previous year period.
However, the adjusted EBITDA for the quarter stood at $56.43 million compared with $45.58 million in the prior year period. At the same time, adjusted EBITDA margin improved 651 basis points in the quarter to 28.51 percent from 22.01 percent in the last year period.
"Choice Hotels continues to be a leader in the hospitality industry, representing 1 in 10 hotels in the U.S. The success of our first quarter financial and development results builds on our 2016 momentum," said Stephen P. Joyce, chief executive officer. "Our strategic focus to help increase franchisee profitability, grow our development pipeline, and strengthen our core business is reflected in our operating results, highlighted by our continued RevPAR growth and the 51-percent increase in new domestic franchise agreements from the first quarter 2016. More importantly, Choice is optimistic that these positive outcomes will continue for both our franchisees and shareholders."
For financial year 2017, Choice Hotels International projects net income to be in the range of $157 million to $160 million, the company expects diluted earnings per share to be in the range of $2.78 to $2.84.
The company expects diluted earnings per share to be in the range of $0.75 to $0.77 for the second-quarter.
Operating cash flow turns positiveChoice Hotels International has generated cash of $24.21 million from operating activities during the quarter as against cash outgo of $21.37 million in the last year period. The company has spent $47.83 million cash to meet investing activities during the quarter as against cash outgo of $41.27 million in the last year period.
Cash flow from financing activities was $8.20 million for the quarter, down 86.90 percent or $54.42 million, when compared with the last year period.
Cash and cash equivalents stood at stood at $187.47 million as at Mar. 31, 2017.
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