Cover Page
Cover Page - shares | 9 Months Ended | |
Sep. 30, 2022 | Oct. 31, 2022 | |
Cover [Abstract] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Sep. 30, 2022 | |
Document Transition Report | false | |
Entity File Number | 001-13393 | |
Entity Registrant Name | CHOICE HOTELS INTERNATIONAL INC /DE | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 52-1209792 | |
Entity Address, Address Line One | 1 Choice Hotels Circle | |
Entity Address, Address Line Two | Suite 400 | |
Entity Address, City or Town | Rockville, | |
Entity Address, State or Province | MD | |
Entity Address, Postal Zip Code | 20850 | |
City Area Code | 301 | |
Local Phone Number | 592-5000 | |
Title of 12(b) Security | Common Stock, Par Value $0.01 per share | |
Trading Symbol | CHH | |
Security Exchange Name | NYSE | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 53,299,203 | |
Entity Central Index Key | 0001046311 | |
Current Fiscal Year End Date | --12-31 | |
Document Fiscal Year Focus | 2022 | |
Document Fiscal Period Focus | Q3 | |
Amendment Flag | false |
CONSOLIDATED STATEMENTS OF INCO
CONSOLIDATED STATEMENTS OF INCOME - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
REVENUES | ||||
Total revenues | $ 414,266 | $ 323,369 | $ 1,039,967 | $ 784,660 |
OPERATING EXPENSES | ||||
Selling, general and administrative | 70,202 | 35,110 | 144,414 | 99,847 |
Depreciation and amortization | 8,726 | 5,883 | 20,436 | 18,477 |
Total operating expenses | 282,627 | 164,263 | 654,891 | 462,532 |
Gain on sale of business and assets, net | 13,379 | 0 | 16,688 | 0 |
Operating income | 145,018 | 159,106 | 401,764 | 322,128 |
OTHER INCOME AND EXPENSES, NET | ||||
Interest expense | 9,362 | 11,638 | 32,084 | 35,106 |
Interest income | (2,348) | (1,202) | (5,256) | (3,717) |
Other loss (gain) | 2,303 | 407 | 9,578 | (2,906) |
Equity in net loss (gain) of affiliates | (1,075) | (3,326) | (1,279) | 1,492 |
Total other income and expenses, net | 8,242 | 7,517 | 35,127 | 29,975 |
Income before income taxes | 136,776 | 151,589 | 366,637 | 292,153 |
Income tax expense | 33,696 | 34,934 | 89,998 | 67,279 |
Net income | $ 103,080 | $ 116,655 | $ 276,639 | $ 224,874 |
Basic earnings per share (in usd per share) | $ 1.87 | $ 2.10 | $ 4.98 | $ 4.05 |
Diluted earnings per share (in usd per share) | 1.85 | 2.08 | 4.93 | 4.01 |
Cash dividends declared per share (in usd per share) | $ 0.2375 | $ 0.225 | $ 0.7125 | $ 0.450 |
Royalty, licensing and management fees | ||||
REVENUES | ||||
Total revenues | $ 144,020 | $ 127,317 | $ 356,208 | $ 299,606 |
Initial franchise fees | ||||
REVENUES | ||||
Total revenues | 7,011 | 6,149 | 21,635 | 18,904 |
Procurement services | ||||
REVENUES | ||||
Total revenues | 14,401 | 13,010 | 47,887 | 36,293 |
Owned hotels | ||||
REVENUES | ||||
Total revenues | 19,992 | 11,377 | 49,220 | 24,724 |
OPERATING EXPENSES | ||||
Operating expenses | 13,158 | 7,054 | 32,004 | 16,534 |
Other | ||||
REVENUES | ||||
Total revenues | 31,432 | 8,645 | 51,588 | 20,753 |
Other revenues from franchised and managed properties | ||||
REVENUES | ||||
Total revenues | 197,410 | 156,871 | 513,429 | 384,380 |
OPERATING EXPENSES | ||||
Operating expenses | $ 190,541 | $ 116,216 | $ 458,037 | $ 327,674 |
CONSOLIDATED STATEMENTS OF COMP
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Statement of Comprehensive Income [Abstract] | ||||
Net income | $ 103,080 | $ 116,655 | $ 276,639 | $ 224,874 |
Other comprehensive income (loss), net of tax: | ||||
Foreign currency translation adjustment | (902) | (57) | (1,139) | 66 |
Other comprehensive income (loss), net of tax | (902) | (57) | (1,139) | 66 |
Comprehensive income | $ 102,178 | $ 116,598 | $ 275,500 | $ 224,940 |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Sep. 30, 2022 | Dec. 31, 2021 |
Current assets | ||
Cash and cash equivalents | $ 52,541 | $ 511,605 |
Accounts receivable (net of allowance for credit losses of $21,595 and $34,149, respectively) | 297,628 | 153,147 |
Income taxes receivable | 508 | 12,511 |
Notes receivable (net of allowance for credit losses of $4,291 and $4,318, respectively) | 52,381 | 54,453 |
Prepaid expenses and other current assets | 56,091 | 29,945 |
Total current assets | 459,149 | 761,661 |
Property and equipment, at cost (net of accumulated depreciation and amortization of $248,137 and $232,492, respectively) | 417,431 | 377,367 |
Operating lease right-of-use assets | 70,533 | 34,183 |
Goodwill | 227,703 | 159,196 |
Intangible assets (net of accumulated amortization of $188,689 and $195,909, respectively) | 723,617 | 312,389 |
Notes receivable (net of allowance for credit losses of $7,122 and $12,461, respectively) | 54,492 | 66,451 |
Investments, employee benefit plans, at fair value | 29,010 | 33,946 |
Investments in affiliates | 29,694 | 27,967 |
Deferred income taxes | 90,847 | 68,643 |
Other assets | 86,507 | 90,021 |
Total assets | 2,188,983 | 1,931,824 |
Current liabilities | ||
Accounts payable | 129,856 | 81,169 |
Accrued expenses and other current liabilities | 125,227 | 104,472 |
Deferred revenue | 85,863 | 81,538 |
Current portion of long-term debt | 2,976 | 216,351 |
Liability for guest loyalty programs | 82,461 | 86,765 |
Total current liabilities | 426,383 | 570,295 |
Long-term debt | 1,155,142 | 844,123 |
Long-term deferred revenue | 134,171 | 105,785 |
Deferred compensation and retirement plan obligations | 43,053 | 38,690 |
Income taxes payable | 15,482 | 20,642 |
Operating lease liabilities | 70,564 | 35,492 |
Liability for guest loyalty programs | 49,113 | 41,785 |
Other liabilities | 10,564 | 9,130 |
Total liabilities | 1,904,472 | 1,665,942 |
Commitments and Contingencies | ||
Common stock, $0.01 par value; 160,000,000 shares authorized; 95,065,638 shares issued at September 30, 2022 and December 31, 2021; 53,773,667 and 55,609,226 shares outstanding at September 30, 2022 and December 31, 2021, respectively | 951 | 951 |
Additional paid-in-capital | 284,092 | 259,317 |
Accumulated other comprehensive loss | (5,713) | (4,574) |
Treasury stock, at cost; 41,291,971 and 39,456,412 shares at September 30, 2022 and December 31, 2021, respectively | (1,507,423) | (1,265,032) |
Retained earnings | 1,512,604 | 1,275,220 |
Total shareholders’ equity | 284,511 | 265,882 |
Total liabilities and shareholders’ equity | $ 2,188,983 | $ 1,931,824 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Thousands | Sep. 30, 2022 | Dec. 31, 2021 |
Statement of Financial Position [Abstract] | ||
Allowance for doubtful accounts | $ 21,595 | $ 34,149 |
Allowance for credit losses, current | 4,291 | 4,318 |
Accumulated depreciation and amortization, property, plant and equipment | 248,137 | 232,492 |
Intangible assets, accumulated amortization | 188,689 | 195,909 |
Allowance for credit losses, noncurrent | $ 7,122 | $ 12,461 |
Common stock, par value (in usd per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized (in shares) | 160,000,000 | 160,000,000 |
Common stock, shares issued (in shares) | 95,065,638 | 95,065,638 |
Common stock, shares outstanding (in shares) | 53,773,667 | 55,609,226 |
Treasury stock, shares (in shares) | 41,291,971 | 39,456,412 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2022 | Sep. 30, 2021 | |
CASH FLOWS FROM OPERATING ACTIVITIES | ||
Net income | $ 276,639 | $ 224,874 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Depreciation and amortization | 20,436 | 18,477 |
Depreciation and amortization – marketing, reservation, and system | 23,237 | 18,364 |
Gain on sale and disposal of business and assets, net | (16,688) | 0 |
Amortization - franchise agreement acquisition cost | 11,558 | 9,734 |
Stock compensation and other charges | 28,621 | 24,277 |
Interest and investment loss (income) | 9,135 | (11,039) |
Deferred income taxes | (22,402) | (34,285) |
Equity in net loss of affiliates, less distributions received | 2,451 | 8,421 |
Franchise agreement acquisition costs, net of reimbursements | (32,947) | (28,466) |
Change in working capital and other | (34,838) | 14,887 |
Net cash provided by operating activities | 265,202 | 245,244 |
CASH FLOWS FROM INVESTING ACTIVITIES | ||
Investment in property and equipment | (66,084) | (46,098) |
Investment in intangible assets | (3,247) | (3,113) |
Asset acquisitions, net of cash paid | (856) | 0 |
Proceeds from sale of business and assets | 140,554 | 0 |
Proceeds from termination of intangibles | 5,698 | 0 |
Business acquisition, net of cash acquired | (550,431) | 0 |
Contributions to investments in affiliates | (4,264) | (2,150) |
Proceeds from sale of equity method investments | 0 | 15,554 |
Purchases of investments, employee benefit plans | (3,719) | (1,279) |
Proceeds from sales of investments, employee benefit plans | 1,896 | 2,487 |
Issuance of notes receivable | (5,617) | (17,918) |
Collections of notes receivable | 701 | 63 |
Other items, net | 1,708 | (115) |
Net cash used in investing activities | (483,661) | (52,569) |
CASH FLOWS FROM FINANCING ACTIVITIES | ||
Payments to extinguish acquired debt | (55,975) | 0 |
Proceeds from acquired derivative | 1,943 | 0 |
Net borrowings pursuant to revolving credit facilities | 315,000 | 0 |
Principal payments on 2012 senior notes | (216,571) | 0 |
Debt issuance costs | (24) | (365) |
Purchases of treasury stock | (246,530) | (10,039) |
Dividends paid | (39,697) | (12,528) |
Proceeds from exercise of stock options | 2,361 | 10,817 |
Net cash used in financing activities | (239,493) | (12,115) |
Net change in cash and cash equivalents | (457,952) | 180,560 |
Effect of foreign exchange rate changes on cash and cash equivalents | (1,112) | (223) |
Cash and cash equivalents at beginning of period | 511,605 | 234,779 |
Cash and cash equivalents at end of period | 52,541 | 415,116 |
Cash payments during the period for | ||
Income taxes, net of refunds | 81,479 | 58,229 |
Interest, net of capitalized interest | 36,691 | 36,519 |
Non-cash investing and financing activities | ||
Dividends declared but not paid | 12,776 | 12,517 |
Investment in property, equipment and intangibles acquired in accounts payable and accrued liabilities | 5,352 | 6,920 |
Asset acquisition from extinguishment of note receivable | $ 20,446 | $ 0 |
CONSOLIDATED STATEMENTS OF SHAR
CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITY - USD ($) $ in Thousands | Total | Common Stock | Additional Paid-in- Capital | Accumulated Other Comprehensive Income (Loss) | Treasury Stock | Retained Earnings | ||||
Beginning balance (in shares) at Dec. 31, 2020 | 55,535,554 | |||||||||
Beginning balance at Dec. 31, 2020 | $ (5,752) | $ 951 | $ 233,921 | $ (4,646) | $ (1,260,478) | $ 1,024,500 | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||
Net income | 22,337 | 22,337 | ||||||||
Other comprehensive income (loss), net of tax | 52 | 52 | ||||||||
Share-based payment activity (in shares) | [1] | 48,781 | ||||||||
Share-based payment activity | 7,644 | 3,617 | [1] | 4,030 | [1] | (3) | [1] | |||
Dividends declared | 0 | |||||||||
Treasury purchases (in shares) | (46,499) | |||||||||
Treasury purchases | (5,046) | (5,046) | ||||||||
Ending balance (in shares) at Mar. 31, 2021 | 55,537,836 | |||||||||
Ending balance at Mar. 31, 2021 | 19,235 | $ 951 | 237,538 | (4,594) | (1,261,494) | 1,046,834 | ||||
Beginning balance (in shares) at Dec. 31, 2020 | 55,535,554 | |||||||||
Beginning balance at Dec. 31, 2020 | (5,752) | $ 951 | 233,921 | (4,646) | (1,260,478) | 1,024,500 | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||
Net income | 224,874 | |||||||||
Other comprehensive income (loss), net of tax | 66 | |||||||||
Ending balance (in shares) at Sep. 30, 2021 | 55,630,704 | |||||||||
Ending balance at Sep. 30, 2021 | 212,146 | $ 951 | 253,361 | (4,580) | (1,261,926) | 1,224,340 | ||||
Beginning balance (in shares) at Mar. 31, 2021 | 55,537,836 | |||||||||
Beginning balance at Mar. 31, 2021 | 19,235 | $ 951 | 237,538 | (4,594) | (1,261,494) | 1,046,834 | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||
Net income | 85,882 | 85,882 | ||||||||
Other comprehensive income (loss), net of tax | 71 | 71 | ||||||||
Share-based payment activity (in shares) | 111,895 | |||||||||
Share-based payment activity | 12,583 | 9,066 | 3,516 | 1 | ||||||
Dividends declared | (12,521) | (12,521) | ||||||||
Treasury purchases (in shares) | (2,738) | |||||||||
Treasury purchases | (317) | (317) | ||||||||
Ending balance (in shares) at Jun. 30, 2021 | 55,646,993 | |||||||||
Ending balance at Jun. 30, 2021 | 104,933 | $ 951 | 246,604 | (4,523) | (1,258,295) | 1,120,196 | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||
Net income | 116,655 | 116,655 | ||||||||
Other comprehensive income (loss), net of tax | (57) | (57) | ||||||||
Share-based payment activity (in shares) | 23,757 | |||||||||
Share-based payment activity | 7,808 | 6,757 | 1,045 | 6 | ||||||
Dividends declared | (12,517) | (12,517) | ||||||||
Treasury purchases (in shares) | (40,046) | |||||||||
Treasury purchases | (4,676) | (4,676) | ||||||||
Ending balance (in shares) at Sep. 30, 2021 | 55,630,704 | |||||||||
Ending balance at Sep. 30, 2021 | $ 212,146 | $ 951 | 253,361 | (4,580) | (1,261,926) | 1,224,340 | ||||
Beginning balance (in shares) at Dec. 31, 2021 | 55,609,226 | 55,609,226 | ||||||||
Beginning balance at Dec. 31, 2021 | $ 265,882 | $ 951 | 259,317 | (4,574) | (1,265,032) | 1,275,220 | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||
Net income | 67,391 | 67,391 | ||||||||
Other comprehensive income (loss), net of tax | (134) | (134) | ||||||||
Share-based payment activity (in shares) | [1] | 262,008 | ||||||||
Share-based payment activity | [1] | 9,558 | 6,068 | 3,486 | 4 | |||||
Dividends declared | [1] | (13,250) | (13,250) | |||||||
Treasury purchases (in shares) | (100,912) | |||||||||
Treasury purchases | (14,802) | (14,802) | ||||||||
Ending balance (in shares) at Mar. 31, 2022 | 55,770,322 | |||||||||
Ending balance at Mar. 31, 2022 | $ 314,645 | $ 951 | 265,385 | (4,708) | (1,276,348) | 1,329,365 | ||||
Beginning balance (in shares) at Dec. 31, 2021 | 55,609,226 | 55,609,226 | ||||||||
Beginning balance at Dec. 31, 2021 | $ 265,882 | $ 951 | 259,317 | (4,574) | (1,265,032) | 1,275,220 | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||
Net income | 276,639 | |||||||||
Other comprehensive income (loss), net of tax | $ (1,139) | |||||||||
Ending balance (in shares) at Sep. 30, 2022 | 53,773,667 | 53,773,667 | ||||||||
Ending balance at Sep. 30, 2022 | $ 284,511 | $ 951 | 284,092 | (5,713) | (1,507,423) | 1,512,604 | ||||
Beginning balance (in shares) at Mar. 31, 2022 | 55,770,322 | |||||||||
Beginning balance at Mar. 31, 2022 | 314,645 | $ 951 | 265,385 | (4,708) | (1,276,348) | 1,329,365 | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||
Net income | 106,168 | 106,168 | ||||||||
Other comprehensive income (loss), net of tax | (103) | (103) | ||||||||
Share-based payment activity (in shares) | 12,422 | |||||||||
Share-based payment activity | 9,595 | 8,999 | 596 | |||||||
Dividends declared | (13,242) | (13,242) | ||||||||
Treasury purchases (in shares) | (2,422) | |||||||||
Treasury purchases | (338) | (338) | ||||||||
Ending balance (in shares) at Jun. 30, 2022 | 55,780,322 | |||||||||
Ending balance at Jun. 30, 2022 | 416,725 | $ 951 | 274,384 | (4,811) | (1,276,090) | 1,422,291 | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||
Net income | 103,080 | 103,080 | ||||||||
Other comprehensive income (loss), net of tax | (902) | (902) | ||||||||
Share-based payment activity (in shares) | (1,655) | |||||||||
Share-based payment activity | 9,763 | 9,708 | 55 | |||||||
Dividends declared | (12,767) | (12,767) | ||||||||
Treasury purchases (in shares) | (2,005,000) | |||||||||
Treasury purchases | $ (231,388) | (231,388) | ||||||||
Ending balance (in shares) at Sep. 30, 2022 | 53,773,667 | 53,773,667 | ||||||||
Ending balance at Sep. 30, 2022 | $ 284,511 | $ 951 | $ 284,092 | $ (5,713) | $ (1,507,423) | $ 1,512,604 | ||||
[1] In April 2020, in light of uncertainty resulting from the COVID-19 pandemic, the Company suspended future, undeclared dividends. In May 2021, the Company resumed the payment of quarterly dividends, subject to future declarations by the Company's board of directors, and declared a quarterly cash dividend of $0.225 per share of common stock. On December 6, 2021, the Company's board of directors approved a 6% increase in the quarterly cash dividend and declared a quarterly cash dividend of $0.2375 per share of common stock. During certain periods presented, accumulated dividends were paid to certain shareholders upon vesting of performance vested restricted stock units ("PVRSU") which are captured in Share-based payment activity. |
CONSOLIDATED STATEMENTS OF SH_2
CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITY (Parenthetical) - $ / shares | 1 Months Ended | |
Dec. 06, 2021 | May 31, 2021 | |
Common Stock | ||
Dividends declared (in dollars per share) | $ 0.2375 | $ 0.225 |
Common stock dividends, percentage increase (as a percent) | 6% |
Basis of Presentation and Signi
Basis of Presentation and Significant Accounting Policies | 9 Months Ended |
Sep. 30, 2022 | |
Accounting Policies [Abstract] | |
Basis of Presentation and Significant Accounting Policies | Basis of Presentation and Significant Accounting Policies Basis of Presentation The accompanying unaudited consolidated financial statements of Choice Hotels International, Inc. and its subsidiaries (together "Choice" or the "Company") have been prepared by the Company in accordance with accounting principles generally accepted in the United States of America ("GAAP") pursuant to the rules and regulations of the Securities and Exchange Commission ("SEC"). All significant intercompany accounts and transactions between the Company and its subsidiaries have been eliminated in consolidation. The preparation of consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. In the opinion of management, the accompanying unaudited consolidated financial statements include all adjustments that are necessary to fairly present the Company's financial position and results of operations. Except as otherwise disclosed, all adjustments are of a normal recurring nature. Certain information and footnote disclosures normally included in financial statements presented in accordance with GAAP have been omitted. Although we believe the disclosures made are adequate to prevent the information presented from being misleading, these financial statements should be read in conjunction with the consolidated financial statements for the year ended December 31, 2021 and notes thereto included in the Company’s Annual Report on Form 10-K, filed with the SEC on February 24, 2022. Interim results are not necessarily indicative of the entire year results. Acquisition of Radisson Hotels Americas On August 11, 2022, the Company completed the acquisition (the "Transaction") of (1) all of the issued and outstanding shares of Radisson Hospitality, Inc. and (2) certain trademarks held by Radisson Hospitality Belgium BV/SRL (collectively referred to as "Radisson Hotels Americas"). With the close of this Transaction, Choice Hotels International has added approximately 67,000 rooms across the United States, Canada, Caribbean and Latin America. The Transaction expands the Company's footprint in international markets and the upper-upscale and upscale full-service segments and enhances guest offerings in the core upper-midscale segment. It also accelerates our asset-light strategy of growth in higher revenue travel segments and locations. The Company has determined it is the accounting acquirer of Radisson Hotels Americas and has accounted for the Transaction as a business combination using the acquisition method of accounting. Accordingly, assets acquired and liabilities assumed were recorded at their fair values as of the acquisition date. Other revenues and expenses from franchised and managed properties In conjunction with the third quarter acquisition of Radisson Hotels Americas, Inc., which resulted in the Company acquiring certain management contracts, the Company has revised its historical presentation of marketing, reservation and system fees and expenses to include fees and expenses related to the acquired management contracts. The presentation of Other revenues from franchised and managed properties represents amounts contractually reimbursable by, or amounts billed and collected in advance from, owners of franchised and managed properties, relating to certain costs and expenses paid by us in support of the operations of these properties. Indirect and direct reimbursements are as follows: • Direct reimbursements include payroll and related costs and certain other operating costs of the managed and franchised properties' operations, which are contractually reimbursed to us by the property owners as expenses are incurred. Revenue is recognized based on the amount of expenses incurred by Choice, which are presented as other expenses from managed and franchised properties in our consolidated statements of operations, that are then reimbursed to us by the property owner typically on a monthly basis, which results in no net effect on operating income or net income. • Indirect reimbursements include marketing, reservation, system and other expenses associated with our brand programs and shared services, which are paid from royalties and program fees collected by Choice from the managed and franchised properties. Indirect reimbursements are typically billed and collected monthly, based on the underlying hotel's sales or usage (such as gross room revenue or number of reservations processed), and revenue is generally recognized as services are provided. The expenses incurred by Choice to operate the marketing and brand programs and shared services are recognized as incurred and presented as Other expenses from managed and franchised properties in our consolidated statements of income and are expected to equal the revenues earned from indirect reimbursements over time. Royalty, licensing and management fees In conjunction with the Transaction, the Company has revised its historical presentation of Royalty fees to Royalty, licensing and management fees to reflect current and future period activity, which includes revenue associated with the acquired management contracts. Initial franchise fees The Company has revised its historical presentation of Initial franchise and relicensing fees to Initial franchise fees. Summary of Significant Accounting Policies The Company’s significant accounting policies are detailed in the “Summary of Significant Accounting Policies” section of Note 1 in the Annual Report on Form 10-K for the year ended December 31, 2021. Recently Adopted Accounting Standards In October 2021, the FASB issued ASU 2021-08, Business Combinations (Topic 805): Accounting for Contract Assets and Contract Liabilities from Contracts with Customers ("ASU 2021-08"). ASU 2021-08 requires an acquirer in a business combination to recognize and measure contract assets and contract liabilities in accordance with Revenue from Contracts with Customers (Topic 606) , as if the acquirer had originated the contracts at the date of the business combination. ASU 2021-08 is effective for annual reporting periods beginning after December 15, 2022 and interim periods within those fiscal years. Early adoption is permitted. The Company elected to early adopt ASU 2021-08 in the second quarter of 2022. There was no retrospective impact to our consolidated financial statement as a result of the adoption. ASU 2021-08 was applied in the accounting for the acquisition of Radisson Hotels Americas, and accordingly, the Company determined that the carrying value of the contract assets and contract liabilities of Radisson Hotels Americas reflects fair value (see Note 15). Recently Issued Accounting Standards In March 2022, the FASB issued ASU 2022-02, Financial Instruments - Credit Losses ("ASU 2022-02"). ASU 2022-02 eliminates the recognition and measurement guidance on troubled debt restructuring for creditors that have adopted ASU 2016-13, Financial Instruments - Credit Losses (Topic 326) ("Topic 326"), requires enhanced disclosures about loan modifications for borrowers experiencing financial difficulty, and includes new guidance on current-period gross write-offs presentation. ASU 2022-02 is effective for annual reporting periods beginning after December 15, 2022 and interim periods within those fiscal years. Early adoption is permitted. The Company is currently assessing the potential impact that ASU 2022-02 will have on the consolidated financial statements and disclosures. |
Revenue
Revenue | 9 Months Ended |
Sep. 30, 2022 | |
Revenue from Contract with Customer [Abstract] | |
Revenue | Revenue Contract Liabilities Contract liabilities relate to (i) advance consideration received, such as initial franchise fees paid when a franchise agreement is executed and system implementation fees paid at time of installation, for services considered to be part of the brand intellectual property performance obligation and (ii) amounts received when loyalty points are issued, but for which revenue is not yet recognized since the related loyalties points have not been redeemed. Deferred revenues from initial fees and system implementation fees are typically recognized over a five Significant changes in the contract liabilities balances during the period December 31, 2021 to September 30, 2022 are as follows: (in thousands) Balance as of December 31, 2021 $ 175,425 Assumption of contract liabilities from Radisson Hotels Americas acquisition 30,031 Increases to the contract liability balance due to cash received 84,356 Revenue recognized in the period (86,473) Balance as of September 30, 2022 $ 203,339 Remaining Performance Obligations The aggregate amount of transaction price allocated to unsatisfied or partially unsatisfied performance obligations is $203.3 million as of September 30, 2022. This amount represents fixed transaction price that will be recognized as revenue in future periods, which is captured in the consolidated balance sheet as current and non-current deferred revenue. Based on practical expedient elections permitted by ASU 2014-09, Revenue From Contracts with Customers (Topic 606) and subsequent amendments ("Topic 606"), the Company does not disclose the value of unsatisfied performance obligations for (i) variable consideration subject to the sales or usage-based royalty constraint or comprising a component of a series (including franchise, partnership, qualified vendor, and software as a service ("SaaS") agreements), (ii) variable consideration for which we recognize revenue at the amount to which we have the right to invoice for services performed, or (iii) contracts with an expected original duration of one year or less. Disaggregation of Revenue Three Months Ended Three Months Ended September 30, 2022 September 30, 2021 (in thousands) Over time Point in time Total Over time Point in time Total Royalty, licensing and management fees $ 143,987 $ 33 $ 144,020 $ 127,317 $ — $ 127,317 Initial franchise fees 7,011 — 7,011 6,149 — 6,149 Procurement services 13,628 773 14,401 12,285 725 13,010 Owned hotels 14,854 5,115 19,969 9,614 1,652 11,266 Other 31,432 — 31,432 8,645 — 8,645 Other revenues from franchised and managed properties 178,349 19,061 197,410 145,216 11,655 156,871 Total Topic 606 revenues $ 389,261 $ 24,982 414,243 $ 309,226 $ 14,032 323,258 Non-Topic 606 revenues 23 111 Total revenues $ 414,266 $ 323,369 Nine Months Ended Nine Months Ended September 30, 2022 September 30, 2021 (in thousands) Over time Point in time Total Over time Point in time Total Royalty, licensing and management fees $ 356,175 $ 33 $ 356,208 $ 299,606 $ — $ 299,606 Initial franchise fees 21,635 — 21,635 18,904 — 18,904 Procurement services 45,503 2,384 47,887 34,526 1,767 36,293 Owned hotels 39,490 9,500 48,990 20,683 3,709 24,392 Other 51,588 — 51,588 20,753 — 20,753 Other revenues from franchised and managed properties 438,734 74,695 513,429 346,211 38,169 384,380 Total Topic 606 revenues $ 953,125 $ 86,612 1,039,737 $ 740,683 $ 43,645 784,328 Non-Topic 606 revenues 230 332 Total revenues $ 1,039,967 $ 784,660 Other revenues from franchised and managed properties and Royalty, licensing and management fees point in time revenues represent loyalty points redeemed by members for benefits (with both franchisees and third-party partners), net of the cost of redemptions. Other revenues include contract termination fees of $22.6 million related to the termination of 110 WoodSpring units. The termination fees recognized represent the $67.4 million in consideration less the carrying basis of the related contract intangibles. As presented in Note 11, the Corporate & Other segment revenue amounts represent $29.7 million and $13.5 million for the three months ended September 30, 2022 and 2021, respectively, and $63.4 million and $30.5 million for the nine months ended September 30, 2022 and 2021, respectively, and are included in the Over time column of Other revenues and the Owned hotels and Non-Topic 606 revenues rows. The remaining revenues relate to the Hotel Franchising segment. Royalty, licensing and management fees and Other revenues from franchised and managed properties are presented net of intersegment revenues of $1.6 million and $0.9 million for the three months ended September 30, 2022 and 2021, respectively, and $3.7 million and $1.9 million for the nine months ended September 30, 2022 and 2021, respectively. |
Receivables and Allowance for C
Receivables and Allowance for Credit Losses | 9 Months Ended |
Sep. 30, 2022 | |
Accounts and Financing Receivable, after Allowance for Credit Loss [Abstract] | |
Receivables and Allowance for Credit Losses | 90 days Total Current Total As of September 30, 2022 Senior $ — $ — $ 15,188 $ 15,188 $ 80,313 $ 95,501 Subordinated — — 2,209 2,209 15,197 17,406 Unsecured 20 40 20 80 5,299 5,379 $ 20 $ 40 $ 17,417 $ 17,477 $ 100,809 $ 118,286 As of December 31, 2021 Senior $ — $ — $ — $ — $ 108,370 $ 108,370 Subordinated — — 2,209 2,209 25,592 27,801 Unsecured — — — — 1,512 1,512 $ — $ — $ 2,209 $ 2,209 $ 135,474 $ 137,683 The Company evaluated its off-balance-sheet credit exposure for loan commitments and determined the likelihood of having to perform is remote as of September 30, 2022. Refer to Note 12. Variable Interest through Notes Issued The Company has issued notes receivables to certain entities that have created variable interests in these borrowers totaling $102.3 million and $120.2 million as of September 30, 2022 and December 31, 2021, respectively. The Company has determined that it is not the primary beneficiary of these variable interest entities ("VIEs"). These loans have stated fixed and/or variable interest amounts. Accounts Receivable Accounts receivable consist primarily of franchise and related fees due from hotel franchisees and are recorded at the invoiced amount. During the nine months ended September 30, 2022, the Company recorded reversals of provisions for credit losses on accounts receivable of $0.4 million in SG&A expenses and provisions of $0.5 million in marketing and reservation system expenses. During the nine months ended September 30, 2021, the Company recorded reversal of provisions for credit losses on accounts receivable of $2.2 million in SG&A expenses and provisions of $4.2 million in marketing and reservation system expenses. During the nine months ended September 30, 2022 and 2021, the Company recorded write-offs, net of recoveries, through the accounts receivable allowance for credit losses of $12.9 million and $5.5 million, respectively. The Company assumed $33.0 million of trade accounts receivable as a result of the Radisson acquisition." id="sjs-B4">Receivables and Allowance for Credit Losses Notes Receivable The Company has provided financing in the form of notes receivable loans to franchisees to support the development of properties in strategic markets. The Company's credit quality indicator is the level of security in the note receivable. The composition of notes receivable balances by credit quality indicator and the allowance for credit losses is as follows: (in thousands) September 30, 2022 December 31, 2021 Senior $ 95,501 $ 108,370 Subordinated 17,406 27,801 Unsecured 5,379 1,512 Total notes receivable 118,286 137,683 Total allowance for notes receivable credit losses 11,413 16,779 Total notes receivable, net of allowance $ 106,873 $ 120,904 Current portion, net of allowance $ 52,381 $ 54,453 Long-term portion, net of allowance $ 54,492 $ 66,451 Amortized cost basis by year of origination and credit quality indicator are as follows: (in thousands) 2022 2021 2020 Prior Total Senior $ — $ 7,838 $ — $ 87,663 $ 95,501 Subordinated — — — 17,406 17,406 Unsecured 424 2,109 1,131 1,715 5,379 Total notes receivable $ 424 $ 9,947 $ 1,131 $ 106,784 $ 118,286 The following table summarizes the activity related to the Company’s notes receivable allowance for credit losses: (in thousands) September 30, 2022 December 31, 2021 Beginning balance $ 16,779 $ 19,484 Provision for credit losses 303 709 Write-offs (5,669) (3,414) Ending balance $ 11,413 $ 16,779 As of September 30, 2022 and December 31, 2021, one and two loans, respectively, with senior and/or subordinated tranches met the definition of collateral-dependent and are collateralized by membership interests in the borrowing entities and either the associated land parcels or an operating hotel. The Company used a discounted cash flow ("DCF") market approach via quoted market prices to value the underlying collateral. The Company reviewed the borrower's financial statements, economic trends, industry projections for the market, and comparable sales capitalization rates, which represent significant inputs to the cash flow projections. These nonrecurring fair value measurements are classified as level three of the fair value measurement hierarchy, as there are unobservable inputs which are significant to the overall fair value. Based on these analyses, the fair value of collateral secures substantially all of the carrying value of each loan. Allowances for credit losses attributable to collateral-dependent loans are $0.9 million and $6.3 million as of September 30, 2022 and December 31, 2021, respectively. The write-offs for the year ended September 30, 2022 and December 31, 2021 are primarily associated with loans previously classified as collateral-dependent that were settled in exchange for an operating hotel on April 14, 2022 and October 1, 2021, respectively, as well as one loan that was settled under negotiated terms. Refer to Note 15 regarding the second quarter 2022 asset acquisition accounting. The Company considers loans past due and in default when payments are not made when due in accordance with then current loan provisions or terms extended to borrowers, including loans with concessions or interest deferral. The Company suspends the accrual of interest when payments on loans are more than 30 days past due or upon a loan being classified as collateral-dependent. The Company applies payments received for loans on non-accrual status first to interest and then to principal. The Company does not resume interest accrual until all delinquent payments are received based on then current loan provisions. The amortized cost basis of notes receivable on non-accrual status was $18.2 million and $44.1 million at September 30, 2022 and December 31, 2021, respectively. The Company has identified loans totaling approximately $4.8 million and $7.5 million as of September 30, 2022 and December 31, 2021, respectively, with stated interest rates that are less than market rate, representing a total unamortized discount of $0.1 million and $0.3 million as of September 30, 2022 and December 31, 2021, respectively. These discounts are reflected as a reduction of the outstanding loan amounts and are amortized over the life of the related loan. The past due balances by credit quality indicator of notes receivable are as follows: (in thousands) 1- 30 days 31-89 days > 90 days Total Current Total As of September 30, 2022 Senior $ — $ — $ 15,188 $ 15,188 $ 80,313 $ 95,501 Subordinated — — 2,209 2,209 15,197 17,406 Unsecured 20 40 20 80 5,299 5,379 $ 20 $ 40 $ 17,417 $ 17,477 $ 100,809 $ 118,286 As of December 31, 2021 Senior $ — $ — $ — $ — $ 108,370 $ 108,370 Subordinated — — 2,209 2,209 25,592 27,801 Unsecured — — — — 1,512 1,512 $ — $ — $ 2,209 $ 2,209 $ 135,474 $ 137,683 The Company evaluated its off-balance-sheet credit exposure for loan commitments and determined the likelihood of having to perform is remote as of September 30, 2022. Refer to Note 12. Variable Interest through Notes Issued The Company has issued notes receivables to certain entities that have created variable interests in these borrowers totaling $102.3 million and $120.2 million as of September 30, 2022 and December 31, 2021, respectively. The Company has determined that it is not the primary beneficiary of these variable interest entities ("VIEs"). These loans have stated fixed and/or variable interest amounts. Accounts Receivable Accounts receivable consist primarily of franchise and related fees due from hotel franchisees and are recorded at the invoiced amount. During the nine months ended September 30, 2022, the Company recorded reversals of provisions for credit losses on accounts receivable of $0.4 million in SG&A expenses and provisions of $0.5 million in marketing and reservation system expenses. During the nine months ended September 30, 2021, the Company recorded reversal of provisions for credit losses on accounts receivable of $2.2 million in SG&A expenses and provisions of $4.2 million in marketing and reservation system expenses. During the nine months ended September 30, 2022 and 2021, the Company recorded write-offs, net of recoveries, through the accounts receivable allowance for credit losses of $12.9 million and $5.5 million, respectively. The Company assumed $33.0 million of trade accounts receivable as a result of the Radisson acquisition. |
Investments in Affiliates
Investments in Affiliates | 9 Months Ended |
Sep. 30, 2022 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Investments in Affiliates | Investments in Affiliates The Company maintains equity method investments in affiliates related to the Company's program to offer equity support to qualified franchisees to develop and operate Cambria Hotels in strategic markets. The Company has investments in affiliates that represent VIEs totaling $24.4 million and $25.2 million on the consolidated balance sheets at September 30, 2022 and December 31, 2021, respectively. The Company has determined that it is not the primary beneficiary of any of these VIEs, however it does exercise significant influence through its equity ownership and as a result the investment in these affiliates is accounted for under the equity method. For the three months ended September 30, 2022 and 2021, the Company recognized losses (gains) totaling $1.1 million and $(2.5) million, respectively, from these investments that represent VIEs. For the nine months ended September 30, 2022 and 2021, the Company recognized losses totaling $2.7 million and $3.0 million, respectively, from these investments that represent VIEs. The Company's maximum exposure to losses related to its investments in VIEs is limited to its equity investments as well as certain limited payment guaranties described in Note 12 of these financial statements. The Company recognized no impairment charges related to equity method investments, nor did we sell an ownership in a joint venture during the nine months ended September 30, 2022. During the first quarter of 2021, the Company recognized an other-than-temporary impairment of $4.8 million related to an equity method investment. The Company assessed the estimated fair value of the investment from comparable market transactions of the investment, which was a key judgment in the fair value determination. This nonrecurring fair value measurement was classified as level three of the fair value measurement hierarchy, as the Company utilized unobservable inputs which are significant to the overall fair value. Based on this analysis, the Company determined that the fair market value declined below the carrying value and the decline is other-than-temporary. As a result, the Company recorded an other-than- temporary impairment from the carrying value to the estimated fair value for the investment. The other-than-temporary impairment is classified as equity in net loss (gain) of affiliates in the consolidated statements of income and captured in the Hotel Franchising reportable segment in Note 11. During the second quarter of 2021, the Company sold its ownership interest in three separate equity method investments. The Company recognized a cumulative gain of $2.6 million on the sales of these investments, which is recorded in equity in net loss (gain) of affiliates. During the third quarter of 2021, a joint venture for which the Company maintains an ownership interest sold its underlying assets. The Company received a distribution and recognized a gain of $4.3 million, which is recorded in equity in net loss (gain) of affiliates. |
Debt
Debt | 9 Months Ended |
Sep. 30, 2022 | |
Debt Disclosure [Abstract] | |
Debt | Debt Debt consists of the following: September 30, 2022 December 31, 2021 (in thousands) $450 million senior unsecured notes due 2031 ("2020 Senior Notes") with an effective interest rate of 3.86%, less a discount and deferred issuance costs of $5.1 million and $5.5 million at September 30, 2022 and December 31, 2021, respectively $ 444,927 $ 444,470 $400 million senior unsecured notes due 2029 ("2019 Senior Notes") with an effective interest rate of 3.88%, less a discount and deferred issuance costs of $4.3 million and $4.8 million at September 30, 2022 and December 31, 2021, respectively 395,688 395,237 $216.6 million senior unsecured notes due 2022 ("2012 Senior Notes") with an effective interest rate of 6.00%, less deferred issuance costs of $0.2 million at December 31, 2021 (1) — 216,351 $600 million senior unsecured revolving credit facility with an effective interest rate of 3.89% less deferred issuance costs of $1.9 million and $2.3 million at September 30, 2022 and December 31, 2021, respectively 313,087 — Economic development loans with an effective interest rate of 3.00% at September 30, 2022 and December 31, 2021, respectively 4,416 4,416 Total debt (2) $ 1,158,118 $ 1,060,474 Less current portion (1) 2,976 216,351 Long-term debt $ 1,155,142 $ 844,123 (1) The 2012 Senior Notes matured on July 1, 2022. The outstanding principal of $216.6 million was re-paid at maturity. (2) As part of the Transaction, we assumed debt that was subsequently paid off. For additional details refer to Note 15. Refer to Note 12 and the Liquidity and Capital Resources header of "Management's Discussion and Analysis of Financial Condition and Results of Operations" for more information. |
Accumulated Other Comprehensive
Accumulated Other Comprehensive Loss | 9 Months Ended |
Sep. 30, 2022 | |
Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract] | |
Accumulated Other Comprehensive Loss | Accumulated Other Comprehensive Loss The changes in accumulated other comprehensive loss, net of tax, for the nine months ended September 30, 2022 and 2021 are as follows: (in thousands) Balance as of December 31, 2021 $ (4,574) Other comprehensive income (loss) before reclassification (1,139) Net current period other comprehensive income (loss) (1,139) Balance as of September 30, 2022 $ (5,713) (in thousands) Balance as of December 31, 2020 $ (4,646) Other comprehensive income (loss) before reclassification 66 Net current period other comprehensive income (loss) 66 Balance as of September 30, 2021 $ (4,580) The other comprehensive income (loss) before reclassification for both the nine months ended September 30, 2022 and 2021 relate to foreign currency items. |
Fair Value Measurements
Fair Value Measurements | 9 Months Ended |
Sep. 30, 2022 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | Fair Value Measurements The Company estimates the fair value of its financial instruments utilizing a three-tier fair value hierarchy, which prioritizes the inputs used in measuring fair value. The following summarizes the three levels of inputs, as well as the assets that the Company values using those levels of inputs on a recurring basis. Level 1 : Quoted prices in active markets for identical assets and liabilities. The Company’s Level 1 assets consist of marketable securities (primarily mutual funds) held in the Deferred Compensation Plan. Level 2 : Observable inputs, other than quoted prices in active markets for identical assets and liabilities, such as quoted prices for similar assets and liabilities; quoted prices in markets that are not active; or other inputs that are observable. The Company’s Level 2 assets consist of money market funds held in the Company's Deferred Compensation Plan. Level 3 : Unobservable inputs, supported by little or no market data available, where the reporting entity is required to develop its own assumptions to determine the fair value of the instrument. The Company does not currently have any assets recorded at fair value whose fair value was determined using Level 3 inputs and there were no transfers of Level 3 assets during the nine months ended September 30, 2022. As of September 30, 2022 and December 31, 2021, the Company had the following assets recorded in the consolidated balance sheets measured at fair value on a recurring basis: Fair Value Measurements at Reporting Date Using (in thousands) Total Level 1 Level 2 Level 3 As of September 30, 2022 Mutual funds (1) $ 26,822 $ 26,822 $ — $ — Money market funds (1) 3,042 — 3,042 — Total $ 29,864 $ 26,822 $ 3,042 $ — As of December 31, 2021 Mutual funds (1) $ 33,555 $ 33,555 $ — $ — Money market funds (1) 2,520 — 2,520 — Total $ 36,075 $ 33,555 $ 2,520 $ — (1) Included in Investments, employee benefit plans, at fair value and Prepaid expenses and other current assets on the consolidated balance sheets. Other financial instruments disclosure The Company believes that the fair values of its current assets and current liabilities approximate their reported carrying amounts due to the short-term nature of these items. In addition, the interest rates of the Company's senior unsecured revolving credit facility adjust frequently based on current market rates; accordingly, we believe its carrying amount, when amounts are drawn, approximates fair value. The fair values of the Company's senior unsecured notes are classified as Level 2, as the significant inputs are observable in an active market. Refer to Note 5 for further information on debt, including the maturity of the 2012 Senior Notes. At September 30, 2022 and December 31, 2021, the carrying amounts and fair values are as follows: September 30, 2022 December 31, 2021 (in thousands) Carrying Amount Fair Value Carrying Amount Fair Value 2020 Senior Notes $ 444,927 $ 371,682 $ 444,470 $ 477,675 2019 Senior Notes 395,688 336,860 395,237 425,984 2012 Senior Notes — — 216,351 221,702 Fair value estimates are made at a specific point in time, are subjective in nature and involve uncertainties and matters of significant judgment. Settlement of such fair value amounts may not be possible or a prudent management decision. |
Income Taxes
Income Taxes | 9 Months Ended |
Sep. 30, 2022 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes The effective income tax rates were 24.6% and 23.1% for the three months ended September 30, 2022 and 2021, respectively. The effective income tax rates were 24.5% and 23.0% for the nine months ended September 30, 2022 and 2021, respectively. The effective income tax rate for the three months ended September 30, 2022 was higher than the U.S. federal income tax rate of 21% primarily due to the impact of state income taxes. The effective income tax rate for the three months ended September 30, 2021 was higher than the U.S. federal income tax rate of 21% primarily due to the impact of state income taxes, partially offset by excess tax benefits from share-based compensation. The effective income tax rates for the nine months ended September 30, 2022 and 2021 were higher than the U.S. federal income tax rate of 21% primarily due to the impact of state income taxes, partially offset by excess tax benefits from share-based compensation. |
Share-Based Compensation and Ca
Share-Based Compensation and Capital Stock | 9 Months Ended |
Sep. 30, 2022 | |
Share-Based Payment Arrangement [Abstract] | |
Share-Based Compensation and Capital Stock | Share-Based Compensation and Capital Stock The components of the Company’s pretax share-based compensation activity are as follows for the three and nine months ended September 30, 2022 and 2021: Three Months Ended September 30, Nine Months Ended September 30, (in thousands) 2022 2021 2022 2021 Stock options $ 1,216 $ 933 $ 3,445 $ 2,482 Restricted stock awards 3,763 2,285 10,364 7,126 Performance vested restricted stock units 4,887 2,950 13,051 7,760 Total share-based compensation expense $ 9,866 $ 6,168 $ 26,860 $ 17,368 A summary of share-based award activity as of and changes during the nine months ended September 30, 2022 are presented below: Stock Options Restricted Stock Performance Vested Options Weighted Weighted Shares Weighted Shares Weighted Outstanding at January 1, 2022 910,944 $ 83.14 236,599 $ 92.60 412,642 $ 114.70 Granted 172,441 143.91 267,206 144.45 111,585 181.91 Performance-Based Leveraging (1) — — — — 27,775 153.75 Exercised/Vested (43,934) 53.70 (95,130) 87.23 — — Expired (986) 51.49 — — (78,370) 81.15 Forfeited (3,255) 131.73 (11,433) 106.12 (3,819) 125.04 Outstanding at September 30, 2022 1,035,210 $ 94.39 5.7 397,242 $ 128.38 469,813 $ 136.32 Options exercisable at September 30, 2022 546,114 $ 76.29 3.5 (1) PVRSUs outstanding have been increased by 27,775 units in the nine months ended September 30, 2022 due to the Company exceeding the targeted performance conditions contained in PVRSUs. Stock Options The stock options granted by the Company had an exercise price equal to the market price of the Company's common stock on the date of grant. The fair value of the options granted was estimated on the grant date using the Black-Scholes option-pricing model with the following weighted average assumptions: 2022 Grants Risk-free interest rate 2.01 % Expected volatility 29.46 % Expected life of stock option 5.9 years Dividend yield 0.66 % Requisite service period 4 years Contractual life 10 years Weighted average fair value of options granted (per option) $ 42.66 Restricted Stock Awards The Company grants two types of restricted stock awards: i) shares of restricted stock and ii) restricted stock units ("RSU"). Shares of restricted stock provide the participant a non-forfeitable right to dividends, if declared, and the right to vote as a shareholder while the shares are unvested. RSUs provide the participant declared dividends that are contingent upon vesting of the award. Restricted stock awards generally vest ratably over the service period beginning with the first anniversary of the grant date. The fair value of restricted stock awards is measured by the market price of the Company's common stock on the date of grant. The service period of restricted stock awards granted during the nine months ended September 30, 2022 range from 9 to 60 months. Performance Vested Restricted Stock Units The Company grants three types of PVRSU awards: i) PVRSUs with performance conditions based on internal performance conditions, including earnings per share ("EPS") relative to Company established targets, ii) PVRSUs with market conditions based on the Company's total shareholder return ("TSR") relative to a predetermined peer group, and iii) PVRSUs with both performance and market conditions. The vesting of PVRSU awards is contingent upon the Company achieving internal performance and/ or TSR targets over a specified period and the employees' continued employment for a service period. These performance and market conditions affect the number of shares that will ultimately vest. During the nine months ended September 30, 2022, the Company granted PVRSUs with market conditions, PVRSUs with performance conditions and PVRSUs with performance and market conditions with requisite service periods between 9 months and 60 months with award vesting ranges between 0% and 300% of the initial units granted. The fair value of PVRSUs with only internal performance conditions is measured by the market price of the Company's common stock on the date of award grant. Compensation expense is recognized ratably over the requisite service period based on the Company's estimate of the achievement of the performance conditions. Management monitors current results and forecasts of the relevant internal performance and, as necessary, adjusts the performance-based leveraging of unvested PVRSUs. The fair value of PVRSUs with market conditions is estimated using a Monte Carlo simulation method as of the date of award grant. Compensation expense is recognized ratably over the requisite service period, regardless of whether the market conditions are achieved and the awards ultimately vest. The fair value of PVRSUs with both performance and market conditions is estimated using a Monte Carlo simulation method as of the date of award grant. Compensation expense is recognized ratably over the requisite service period based on the Company's estimate of the achievement of the performance conditions, with subsequent adjustments made for performance-based leveraging of unvested PVRSUs, as necessary. Share Repurchases and Redemptions In April 2020, in light of uncertainty resulting from the COVID-19 pandemic, the Company suspended activity under the Company's share repurchase program. In May 2021, the Company's board of directors approved resumption of the share repurchase program. On September 14, 2022, the Company’s board of directors approved an increase in the number of the shares authorized under its share repurchase program by five million shares, bringing the total program to approximately 6.7 million shares authorized as of that date. Refer to the Liquidity and Capital Resources header of "Management's Discussion and Analysis of Financial Condition and Results of Operations" for more information. During the three months ended September 30, 2022, 2,004,386 shares of common stock were purchased under the share repurchase program at a total cost of $231.3 million. During the nine months ended September 30, 2022, 2,072,872 shares of common stock were purchased under the share repurchase program at a total cost of $241.2 million. During the three and nine months ended September 30, 2021, there were 34,746 and 36,328 purchases of common stock under the share repurchase program at a total cost of $4.0 million and $4.2 million, respectively. During the three months ended September 30, 2022 and 2021, the Company redeemed 614 and 5,300 shares of common stock at a total cost of $0.1 million and $0.7 million, respectively, from employees to satisfy the option exercise price and statutory minimum tax-withholding requirements related to the exercising of stock options and vesting of performance vested restricted stock units and restricted stock grants. During the nine months ended September 30, 2022 and 2021, the Company redeemed 35,462 and 52,955 shares of common stock at a total cost of $5.3 million and $5.8 million, respectively, from employees to satisfy the option exercise price and statutory minimum tax-withholding requirements related to the exercising of stock options and vesting of performance vested restricted stock units and restricted stock grants. These redemptions were outside the share repurchase program. |
Earnings Per Share
Earnings Per Share | 9 Months Ended |
Sep. 30, 2022 | |
Earnings Per Share [Abstract] | |
Earnings Per Share | Earnings Per Share The Company’s shares of restricted stock contain rights to receive nonforfeitable dividends and thus are participating securities requiring the computation of basic EPS using the two-class method. As the shares of restricted stock are both potential shares of common stock and participating securities, the Company calculates diluted earnings per share by the more dilutive of the treasury stock method or the two-class method. The calculation of EPS for net income available to common shareholders excludes the distribution of dividends and undistributed earnings attributable to participating securities from the numerator. The diluted earnings weighted average shares of common stock outstanding includes stock options, PVRSUs and RSUs. The computation of basic and diluted earnings per share of common stock is as follows: Three Months Ended Nine Months Ended September 30, September 30, (in thousands, except per share amounts) 2022 2021 2022 2021 Numerator: Net income $ 103,080 $ 116,655 $ 276,639 $ 224,874 Income allocated to participating securities (614) (420) (1,526) (910) Net income available to common shareholders $ 102,466 $ 116,235 $ 275,113 $ 223,964 Denominator: Weighted average shares of common stock outstanding – basic 54,847 55,427 55,233 55,360 Basic earnings per share $ 1.87 $ 2.10 $ 4.98 $ 4.05 Numerator: Net income $ 103,080 $ 116,655 $ 276,639 $ 224,874 Income allocated to participating securities (614) (420) (1,526) (910) Net income available to common shareholders $ 102,466 $ 116,235 $ 275,113 $ 223,964 Denominator: Weighted average shares of common stock outstanding – basic 54,847 55,427 55,233 55,360 Dilutive effect of stock options and PVRSUs 395 478 520 429 Weighted average shares of common stock outstanding – diluted 55,242 55,905 55,753 55,789 Diluted earnings per share $ 1.85 $ 2.08 $ 4.93 $ 4.01 The following securities have been excluded from the calculation of diluted weighted average shares of common stock outstanding as the inclusion of these securities would have an anti-dilutive effect: Three Months Ended Nine Months Ended September 30, September 30, (in thousands) 2022 2021 2022 2021 Stock options 170 — 154 — PVRSUs 75 155 75 155 |
Reportable Segment Information
Reportable Segment Information | 9 Months Ended |
Sep. 30, 2022 | |
Segment Reporting [Abstract] | |
Reportable Segment Information | Reportable Segment Information The Hotel Franchising reportable segment includes the Company's hotel franchising operations consisting of its 23 brands and brand extensions. The 23 brands and brand extensions are aggregated within this segment considering their similar economic characteristics, types of customers, distribution channels and regulatory business environments. Revenues from the hotel franchising business include royalty fees, initial franchise fees, marketing and reservation system fees, procurement services revenue and other hotel franchising related revenue. The Company is obligated under its hotel franchise agreements to provide marketing and reservation services appropriate for the operation of its systems. The revenues received from franchisees that are used to pay for part of the Company's ongoing operations are included in hotel franchising revenues and are offset by the related expenses paid for marketing and reservation system activities to calculate hotel franchising operating income. Equity in earnings or losses from hotel franchising related investment in affiliates is allocated to the Company's Hotel Franchising segment. The Company evaluates its Hotel Franchising segment based primarily on the results of the segment without allocating corporate expenses, indirect general and administrative expenses, interest expense, interest income, other gains and losses or income taxes, which are included in the Corporate & Other column. Corporate & Other revenues include owned hotel revenues and revenues related to the Company's SaaS technology solutions division which provide cloud-based property management software to non-franchised hoteliers. Intersegment revenue adjustment is from the elimination of Hotel Franchising revenue which include royalty fees, marketing and reservation system fees, management fees, payroll costs and other cost reimbursements charged to our owned hotels against hotel operating expenses recognized by our owned hotels in Corporate & Other operating income (loss). Our President and Chief Executive Officer, who is our chief operating decision maker, does not use assets by operating segment when assessing performance or making operating segment resource allocations decisions and therefore assets by segment are not disclosed below. The following table presents the financial information for the Company's segments: Three Months Ended September 30, 2022 Three Months Ended September 30, 2021 (in thousands) Hotel Corporate & Intersegment Eliminations Consolidated Hotel Corporate & Intersegment Eliminations Consolidated Revenues $ 386,124 $ 29,692 $ (1,550) $ 414,266 $ 310,703 $ 13,532 $ (866) $ 323,369 Operating income (loss) $ 161,084 $ (16,066) $ — $ 145,018 $ 169,516 $ (10,410) $ — $ 159,106 Income (loss) before income taxes $ 162,162 $ (25,386) $ — $ 136,776 $ 172,338 $ (20,749) $ — $ 151,589 Nine Months Ended September 30, 2022 Nine Months Ended September 30, 2021 (in thousands) Hotel Corporate & Intersegment Eliminations Consolidated Hotel Corporate & Intersegment Eliminations Consolidated Revenues $ 980,352 $ 63,363 $ (3,748) $ 1,039,967 $ 756,013 $ 30,504 $ (1,857) $ 784,660 Operating income (loss) $ 433,852 $ (32,088) $ — $ 401,764 $ 360,269 $ (38,141) $ — $ 322,128 Income (loss) before income taxes $ 435,131 $ (68,494) $ — $ 366,637 $ 358,274 $ (66,121) $ — $ 292,153 |
Commitments and Contingencies
Commitments and Contingencies | 9 Months Ended |
Sep. 30, 2022 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies The Company is not a party to any litigation other than litigation in the ordinary course of business. The Company's management and legal counsel do not expect that the ultimate outcome of any of its currently ongoing legal proceedings, individually or collectively, will have a material adverse effect on the Company's financial position, results of operations or cash flows. Contingencies The Company entered into various limited payment guaranties with regards to the Company’s VIEs supporting their efforts to develop and own hotels franchised under the Company’s brands. Under these limited payment guaranties, the Company has agreed to guarantee a portion of the outstanding debt until certain conditions are met such as (a) the loan matures, (b) certain debt covenants are achieved, (c) the maximum amount guaranteed by the Company is paid in full or (d) the Company, through its affiliates, ceases to be a member of the VIE. The maximum exposure of principal incidental to these limited payment guaranties is $5.7 million, plus unpaid expenses and accrued unpaid interest. As of September 30, 2022 and December 31, 2021, the Company believed the likelihood of having to perform under the aforementioned limited payment guaranties was remote. In the event of performance, the Company has recourse for one of the transactions in the form of a membership interest pledge as collateral for the guaranty. Commitments The Company has the following commitments outstanding at September 30, 2022: • The Company provides financing in the form of franchise agreement acquisition payments to franchisees for property improvements, hotel development efforts and other purposes. These payments are typically made at commencement of construction or hotel opening, in accordance with agreed upon provisions in individual franchise agreements. At September 30, 2022, the Company had commitments to extend an additional $302.5 million for these purposes provided the conditions of the payment are met by its franchisees. • As part of the acquisition of Radisson Hotels Americas, the Company entered into a long-term management arrangement, with an expiration date of July 31, 2031, to manage eight hotel properties owned by a third-party. In conjunction with the management arrangement, the Company entered into a guarantee with the third-party to fund any shortfalls in the payment of the third-party owner’s priority stipulated in the management agreement up to a maximum amount of $46 million. On November 1, 2021, an amended and restated management agreement was executed between the Company and the third party. The maximum guarantee under the agreement is $22 million. There are no potential guaranteed payments until January 2023 and future performance is expected to be sufficient to cover the terms of the agreement. Accordingly, no liability was recorded as of September 30, 2022 in accrued liabilities within the consolidated balance sheets. • To the extent existing unconsolidated affiliates proceed to the hotel construction phase, the Company is committed to make capital contributions totaling $7.7 million to support their efforts to construct Cambria hotels. • The Company committed to provide financing in the form of loans or credit facilities to franchisees for Choice brand development efforts. At September 30, 2022, the Company has remaining commitments of approximately $1.8 million, upon certain conditions being met. • The Company’s franchise agreements require the payment of franchise fees, which include marketing and reservation system fees. In accordance with terms of our franchise agreements, the Company is obligated to use the marketing and reservation system revenues it collects from the current franchisees comprising its various hotel brands to provide marketing and reservation services appropriate to support the operation of the overall system. To the extent revenues collected exceed expenditures incurred, the Company has a commitment to the franchisee system to make expenditures in future years. Conversely, to the extent expenditures incurred exceed revenues collected, the Company has the contractual enforceable right to assess and collect such amounts. In the ordinary course of business, the Company enters into numerous agreements that contain standard indemnities whereby the Company indemnifies another party for breaches of representations and warranties. Such indemnifications are granted under various agreements, including those governing (i) purchases or sales of assets or businesses, (ii) leases of real estate, (iii) licensing of trademarks, (iv) access to credit facilities, (v) issuances of debt or equity securities, and (vi) certain operating agreements. The indemnifications issued are for the benefit of the (i) buyers in sale agreements and sellers in purchase agreements, (ii) landlords in lease contracts, (iii) franchisees in licensing agreements, (iv) financial institutions in credit facility arrangements, (v) underwriters in debt or equity security issuances and (vi) parties under certain operating agreements. In addition, these parties are also generally indemnified against any third-party claim resulting from the transaction that is contemplated in the underlying agreement. While some of these indemnities extend only for the duration of the underlying agreement, many survive the expiration of the term of the agreement or extend into perpetuity (unless subject to a legal statute of limitations). There are no specific limitations on the maximum potential amount of future payments that the Company could be required to make under these indemnities, nor is the Company able to develop an estimate of the maximum potential amount of future payments to be made under these indemnifications as the triggering events are not subject to predictability. With respect to certain of the aforementioned indemnities, such as indemnifications of landlords against third-party claims for the use of real estate property leased by the Company, the Company maintains insurance coverage that mitigates potential liability. |
Transactions with Unconsolidate
Transactions with Unconsolidated Affiliates | 9 Months Ended |
Sep. 30, 2022 | |
Equity Method Investments and Joint Ventures [Abstract] | |
Transactions with Unconsolidated Affiliates | Transactions with Unconsolidated Affiliates The Company has a management fee arrangement for marketing services with a partner in an unconsolidated affiliate. For the three months ended September 30, 2022 and 2021, fees earned and payroll costs reimbursed under this arrangement totaled $0.8 million and $0.6 million, respectively. For the nine months ended September 30, 2022 and 2021, fees earned and payroll costs reimbursed under this arrangement totaled $1.7 million and $1.1 million, respectively. The Company has entered into franchise agreements with certain of the unconsolidated affiliates discussed in Note 4. Pursuant to these franchise agreements, for the three months ended September 30, 2022 and 2021, the Company recorded royalty and marketing reservation system fees of approximately $8.9 million and $8.0 million, respectively. For the nine months ended September 30, 2022 and 2021, the Company recorded royalty and marketing reservation system fees of approximately $19.5 million and $15.0 million, respectively. The Company recorded $4.8 million and $2.7 million as a receivable due from these affiliates as of September 30, 2022 and December 31, 2021, respectively. As part of the acquisition of Radisson Hotels Americas as discussed in Note 15, the Company has a management fee arrangement with an investment in an unconsolidated affiliate accounted for under the cost method. For the three and nine months ended September 30, 2022, fees earned and payroll costs reimbursed under this arrangement totaled $0.6 million. |
Assets Held for Sale
Assets Held for Sale | 9 Months Ended |
Sep. 30, 2022 | |
Discontinued Operations and Disposal Groups [Abstract] | |
Assets Held for Sale | Assets Held for Sale Assets held for sale of $28.3 million are recorded within Prepaid expenses and other current assets on the consolidated balance sheets related to an owned Cambria hotel asset. The hotel met held for sale classification as of September 2022. Based on the fair value of the hotel, less costs to sell, a $2.2 million impairment charge was recorded to offset the Gain on sale of business and assets, net line item on the consolidated statement of income during the third quarter of 2022 within the Corporate & Other segment for reflect the reduction in the asset's carrying value. The building was sold to a third-party franchisee in October 2022, which will result in derecognition from the balance sheet in the fourth quarter of 2022 . |
Acquisitions
Acquisitions | 9 Months Ended |
Sep. 30, 2022 | |
Business Combination and Asset Acquisition [Abstract] | |
Acquisitions | Acquisitions April 2022 Asset Acquisition In April 2022, the Company reached a settlement with a borrower holding a senior and mezzanine loan classified as collateral-dependent, collateralized by an operating hotel. As a collateral-dependent financial asset, the expected credit losses as of March 31, 2022 were determined based on the fair value of the operating hotel. As of March 31, 2022, the Notes receivable, net of allowance for credit losses, balance was $20.4 million. The key terms of the settlement resulted in a deed in lieu of foreclosure on the operating hotel in exchange for releasing obligations pursuant to the senior and mezzanine loans and the associated franchise agreement. The property was exchanged in full settlement of the senior and mezzanine loans and recorded at the fair value of $20.4 million as of the acquisition date of April 14, 2022. The fair value was estimated using an income approach valuation method based on discounted cash flows of the collateralized operating hotel utilizing historical operating performance, industry projections for the market, and comparable sales capitalization rates. In accordance with the provisions of ASU 2017-01, Business Combinations (Topic 805): Clarifying the Definition of a Business ("ASU 2017-01"), the purchase represents an asset acquisition based on the concentration of value in the acquired land and building. The $20.4 million was re-characterized from Notes receivable, net of allowance for credit losses, and attributed to each asset class based on a relative fair value allocation to qualifying assets, resulting in $3.3 million to land, $16.6 million to building and improvements, $1.3 million to furniture, fixtures, and equipment, and $(0.8) million to net liabilities assumed. August 2022 Radisson Hotels Americas Acquisition On August 11, 2022, the Company completed the acquisition of Radisson Hotels Americas. The accounting purchase price for the Transaction was $673.9 million, which includes the base purchase price of $675.2 million, adjusted for Disclosed Leakage (as defined in the Share Sale and Purchase Agreement) and certain other prepaid expenses. To fund the Transaction, Choice drew $175.0 million on the Company's existing $600.0 million unsecured credit facility (the "Revolver"), and funded the remainder with cash on hand. Additionally, in connection with the acquisition, we recorded $24.9 million and $29.0 million of transaction, transition, and severance expense, included within Selling, general and administrative, during the three and nine months ended September 30, 2022, respectively. Preliminary Fair Values of Assets Acquired and Liabilities Assumed The Company allocated the purchase price based upon a preliminary assessment of the fair value of the assets acquired and liabilities assumed as of August 11, 2022. These preliminary fair values are based on management’s estimates and assumptions, using the best information available at the time of this filing. The final valuation and related allocation of the purchase price will be completed no later than 12 months after the closing date. The final acquisition accounting adjustments may b e materially different and may include (1) changes in fair value of property and equipment and associated salvage values, (2) changes in allocations to intangible assets, such trade names, acquired franchise and management agreements, above and below market leases, as well as goodwill; and (3) other changes to assets and liabilities, such as working capital. The preliminary allocation of the purchase price, as presented in our Consolidated Balance Sheet: Assets acquired Amount Cash and cash equivalents $ 113,023 Restricted cash 10,403 Accounts receivable 32,972 Notes receivables - current 1,709 Prepaid expenses and other current assets 8,139 Property and equipment 125,441 Operating lease right-of-use of assets 42,315 Intangible assets 447,400 Notes receivable - noncurrent 2,592 Investment in affiliates 471 Other assets 2,129 Total assets acquired $ 786,594 Liabilities assumed Accounts payable 8,295 Accrued expenses and other current liabilities 15,987 Deferred revenue - current (1) 5,745 Liability for guest loyalty program - current (1) 3,542 Long-term debt 55,975 Long-term deferred revenue (1) 26,499 Deferred compensation and retirement plan obligations 9,265 Operating lease liabilities 42,705 Liability for guest loyalty program - noncurrent (1) 10,180 Other liabilities 3,052 Total liabilities assumed $ 181,245 Fair value of net assets acquired $ 605,349 Goodwill 68,507 Total purchase consideration $ 673,856 (1) The Deferred revenue (including deferred affiliation fees) and Liability for guest loyalty program balances were assumed at their carrying value at the date of the acquisition pursuant to the application of ASU 2021-08 (see Note 1). Property and Equipment The following table presents the preliminary estimates of fair value of the acquired property and equipment, which is primarily concentrated at three acquired hotel properties, and their estimated weighted average remaining useful lives. Estimated Useful Life Estimated Fair Value (in years) (in thousands) Land N/A $ 7,159 Construction in progress N/A 3,190 Building and leasehold improvements 24.4 93,934 Site improvements 23.1 586 Furniture, fixtures and equipment 3.9 8,334 Computer equipment and software 2.0 12,238 Total $ 125,441 We provisionally estimated the value of the property and equipment through a combination of income, cost and market approaches, which are primarily based on significant Level 2 and Level 3 assumptions, such as estimates of future income growth, discount rates, capitalization rates and capital expenditure needs of the hotels. We are continuing to assess the marketplace assumptions and property conditions, which could result in changes to these provisional values. Identified Intangible Assets The following table presents our preliminary estimates of the fair value of the acquired identified intangible assets and their estimated useful lives: Estimated Useful Life Estimated Fair Value (in years) (in thousands) Trade names N/A $ 223,700 Franchise agreements 15.5 220,400 Management agreements 15.5 3,300 Total $ 447,400 The fair value of the trade names was provisionally estimated using the relief-from-royalty method. This method applies an estimated royalty rate to forecasted future cash flows, discounted to present value. The fair value of the franchise and management agreements was preliminarily estimated using a multi-period excess earnings method, a variation of the income approach. This method uses the present value of incremental after-tax cash flows attributable to the intangible asset to estimate fair value. These valuation methodologies utilize Level 3 assumptions, and we are continuing to assess the assumptions used in estimating these values as well as the respective useful lives, which could result in changes to these provisional values. Debt Assumed As part of the Transaction, we assumed a mortgage of $56.0 million related to an acquired hotel property. Subsequent to the acquisition closing date, this amount was repaid in full using cash we acquired. Related to the mortgage, we acquired $10.4 million in restricted cash, for which restrictions were lifted upon repayment. Operating Leases The Company measured operating lease liabilities assumed at the present value of remaining payments as of the acquisition date, discounted using Choice's applicable incremental borrowing rate, in accordance with Leases (Topic 842) . The corresponding right-of-use assets acquired were measured at the value of the lease liabilities, further adjusted for favorable or unfavorable lease terms as compared to market terms. We are continuing to assess market assumptions, which could change our preliminary estimate. Income Taxes Pursuant to the terms of the Transaction, the parties agree to jointly make a valid, timely election under Section 338(h)(10) of the U.S. Internal Revenue Code and under any similar provisions of state or local law with respect to the purchase of the shares of Radisson Hotels Americas. Under this election, the parties agreed to treat the Transaction for federal income tax purposes as if it had been structured as an asset sale and purchase. As a result of this election, the tax basis of the assets acquired and liabilities assumed by Choice were reset to fair value at the time of the acquisition, which results in the elimination of previously established deferred income tax balances and the establishment of new balances that reflect the new tax basis, including tax deductible goodwill. Because the accounting for the Transaction is ongoing, the resulting deferred tax balances are still being finalized. Pro Forma Results of Operations The following unaudited pro forma information presents the combined results of operations of Choice and Radisson Hotels Americas as if we had completed the Transaction on January 1, 2021, but using our preliminary fair values of assets acquired and liabilities assumed as of the acquisition date. The unaudited pro forma information reflects adjustments relating to (i) the allocation of purchase price and related adjustments, including incremental depreciation and amortization expense based on the preliminary fair values of the property and equipment assets and intangible assets acquired; (ii) the incremental impact of the Revolver draw on interest expense and amortization of financing costs; (iii) nonrecurring transaction costs; and (iv) income tax impact of the aforementioned pro forma adjustments. As required by GAAP, these unaudited pro forma results do not reflect any cost saving synergies from operating efficiencies. Accordingly, these unaudited pro forma results are presented for informational purposes only and are not necessarily indicative of what the actual results of operations of the combined company would have been if the transaction had occurred at the beginning of the period presented, nor are they indicative of future results of operations. Nine Months Ended September 30, (in thousands) 2022 2021 Revenues $ 1,189,792 $ 928,669 Net income 304,770 173,822 Radisson Hotels Americas Results of Operations The results of Radisson Hotels Americas have been consolidated with the Company since August 11, 2022 and are included in the Company’s Consolidated Statement of Income for the nine months ended September 30, 2022. The following table presents these results of the 51 days from the closing date through September 30, 2022. (in thousands) August 11, 2022 - September 30, 2022 Revenues $ 40,203 Net income (loss) (1,380) Goodwill The excess value recorded in goodwill is primarily attributable to value we expect to realize from the existing customer base, improvements in RevPAR, cost synergies and new agreements signed with new franchisees and developers. Goodwill for the Transaction is fully attributable to the Hotel Franchising reportable segment and is fully deductible for tax purposes. The following table details the carrying amount of the Company's goodwill, including goodwill arising from the acquisition of Radisson Hotels Americas, as of September 30, 2022. (in thousands) September 30, 2022 Goodwill, excluding goodwill arising from Radisson Hotels Americas acquisition $ 166,774 Accumulated impairment losses (7,578) Goodwill arising from Radisson Hotels Americas acquisition 68,507 Goodwill, net carrying amount $ 227,703 |
Basis of Presentation and Sig_2
Basis of Presentation and Significant Accounting Policies (Policy) | 9 Months Ended |
Sep. 30, 2022 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation The accompanying unaudited consolidated financial statements of Choice Hotels International, Inc. and its subsidiaries (together "Choice" or the "Company") have been prepared by the Company in accordance with accounting principles generally accepted in the United States of America ("GAAP") pursuant to the rules and regulations of the Securities and Exchange Commission ("SEC"). All significant intercompany accounts and transactions between the Company and its subsidiaries have been eliminated in consolidation. The preparation of consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. In the opinion of management, the accompanying unaudited consolidated financial statements include all adjustments that are necessary to fairly present the Company's financial position and results of operations. Except as otherwise disclosed, all adjustments are of a normal recurring nature. Certain information and footnote disclosures normally included in financial statements presented in accordance with GAAP have been omitted. Although we believe the disclosures made are adequate to prevent the information presented from being misleading, these financial statements should be read in conjunction with the consolidated financial statements for the year ended December 31, 2021 and notes thereto included in the Company’s Annual Report on Form 10-K, filed with the SEC on February 24, 2022. Interim results are not necessarily indicative of the entire year results. |
Other revenues and expenses from franchised and managed properties | Other revenues and expenses from franchised and managed properties In conjunction with the third quarter acquisition of Radisson Hotels Americas, Inc., which resulted in the Company acquiring certain management contracts, the Company has revised its historical presentation of marketing, reservation and system fees and expenses to include fees and expenses related to the acquired management contracts. The presentation of Other revenues from franchised and managed properties represents amounts contractually reimbursable by, or amounts billed and collected in advance from, owners of franchised and managed properties, relating to certain costs and expenses paid by us in support of the operations of these properties. Indirect and direct reimbursements are as follows: • Direct reimbursements include payroll and related costs and certain other operating costs of the managed and franchised properties' operations, which are contractually reimbursed to us by the property owners as expenses are incurred. Revenue is recognized based on the amount of expenses incurred by Choice, which are presented as other expenses from managed and franchised properties in our consolidated statements of operations, that are then reimbursed to us by the property owner typically on a monthly basis, which results in no net effect on operating income or net income. • Indirect reimbursements include marketing, reservation, system and other expenses associated with our brand programs and shared services, which are paid from royalties and program fees collected by Choice from the managed and franchised properties. Indirect reimbursements are typically billed and collected monthly, based on the underlying hotel's sales or usage (such as gross room revenue or number of reservations processed), and revenue is generally recognized as services are provided. The expenses incurred by Choice to operate the marketing and brand programs and shared services are recognized as incurred and presented as Other expenses from managed and franchised properties in our consolidated statements of income and are expected to equal the revenues earned from indirect reimbursements over time. Royalty, licensing and management fees In conjunction with the Transaction, the Company has revised its historical presentation of Royalty fees to Royalty, licensing and management fees to reflect current and future period activity, which includes revenue associated with the acquired management contracts. Initial franchise fees The Company has revised its historical presentation of Initial franchise and relicensing fees to Initial franchise fees. |
Recently Adopted and Issued Accounting Standards | Recently Adopted Accounting Standards In October 2021, the FASB issued ASU 2021-08, Business Combinations (Topic 805): Accounting for Contract Assets and Contract Liabilities from Contracts with Customers ("ASU 2021-08"). ASU 2021-08 requires an acquirer in a business combination to recognize and measure contract assets and contract liabilities in accordance with Revenue from Contracts with Customers (Topic 606) , as if the acquirer had originated the contracts at the date of the business combination. ASU 2021-08 is effective for annual reporting periods beginning after December 15, 2022 and interim periods within those fiscal years. Early adoption is permitted. The Company elected to early adopt ASU 2021-08 in the second quarter of 2022. There was no retrospective impact to our consolidated financial statement as a result of the adoption. ASU 2021-08 was applied in the accounting for the acquisition of Radisson Hotels Americas, and accordingly, the Company determined that the carrying value of the contract assets and contract liabilities of Radisson Hotels Americas reflects fair value (see Note 15). Recently Issued Accounting Standards In March 2022, the FASB issued ASU 2022-02, Financial Instruments - Credit Losses ("ASU 2022-02"). ASU 2022-02 eliminates the recognition and measurement guidance on troubled debt restructuring for creditors that have adopted ASU 2016-13, Financial Instruments - Credit Losses (Topic 326) ("Topic 326"), requires enhanced disclosures about loan modifications for borrowers experiencing financial difficulty, and includes new guidance on current-period gross write-offs presentation. ASU 2022-02 is effective for annual reporting periods beginning after December 15, 2022 and interim periods within those fiscal years. Early adoption is permitted. The Company is currently assessing the potential impact that ASU 2022-02 will have on the consolidated financial statements and disclosures. |
Revenue (Tables)
Revenue (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Revenue from Contract with Customer [Abstract] | |
Schedule of Contract with Customer, Liability | Significant changes in the contract liabilities balances during the period December 31, 2021 to September 30, 2022 are as follows: (in thousands) Balance as of December 31, 2021 $ 175,425 Assumption of contract liabilities from Radisson Hotels Americas acquisition 30,031 Increases to the contract liability balance due to cash received 84,356 Revenue recognized in the period (86,473) Balance as of September 30, 2022 $ 203,339 |
Schedule of Disaggregation of Revenue | Disaggregation of Revenue Three Months Ended Three Months Ended September 30, 2022 September 30, 2021 (in thousands) Over time Point in time Total Over time Point in time Total Royalty, licensing and management fees $ 143,987 $ 33 $ 144,020 $ 127,317 $ — $ 127,317 Initial franchise fees 7,011 — 7,011 6,149 — 6,149 Procurement services 13,628 773 14,401 12,285 725 13,010 Owned hotels 14,854 5,115 19,969 9,614 1,652 11,266 Other 31,432 — 31,432 8,645 — 8,645 Other revenues from franchised and managed properties 178,349 19,061 197,410 145,216 11,655 156,871 Total Topic 606 revenues $ 389,261 $ 24,982 414,243 $ 309,226 $ 14,032 323,258 Non-Topic 606 revenues 23 111 Total revenues $ 414,266 $ 323,369 Nine Months Ended Nine Months Ended September 30, 2022 September 30, 2021 (in thousands) Over time Point in time Total Over time Point in time Total Royalty, licensing and management fees $ 356,175 $ 33 $ 356,208 $ 299,606 $ — $ 299,606 Initial franchise fees 21,635 — 21,635 18,904 — 18,904 Procurement services 45,503 2,384 47,887 34,526 1,767 36,293 Owned hotels 39,490 9,500 48,990 20,683 3,709 24,392 Other 51,588 — 51,588 20,753 — 20,753 Other revenues from franchised and managed properties 438,734 74,695 513,429 346,211 38,169 384,380 Total Topic 606 revenues $ 953,125 $ 86,612 1,039,737 $ 740,683 $ 43,645 784,328 Non-Topic 606 revenues 230 332 Total revenues $ 1,039,967 $ 784,660 |
Receivables and Allowance for_2
Receivables and Allowance for Credit Losses (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Accounts and Financing Receivable, after Allowance for Credit Loss [Abstract] | |
Schedule of Notes Receivable | The composition of notes receivable balances by credit quality indicator and the allowance for credit losses is as follows: (in thousands) September 30, 2022 December 31, 2021 Senior $ 95,501 $ 108,370 Subordinated 17,406 27,801 Unsecured 5,379 1,512 Total notes receivable 118,286 137,683 Total allowance for notes receivable credit losses 11,413 16,779 Total notes receivable, net of allowance $ 106,873 $ 120,904 Current portion, net of allowance $ 52,381 $ 54,453 Long-term portion, net of allowance $ 54,492 $ 66,451 |
Schedule of Financing Receivable Credit Quality Indicators | Amortized cost basis by year of origination and credit quality indicator are as follows: (in thousands) 2022 2021 2020 Prior Total Senior $ — $ 7,838 $ — $ 87,663 $ 95,501 Subordinated — — — 17,406 17,406 Unsecured 424 2,109 1,131 1,715 5,379 Total notes receivable $ 424 $ 9,947 $ 1,131 $ 106,784 $ 118,286 |
Schedule of Financing Receivable, Allowance for Credit Loss | The following table summarizes the activity related to the Company’s notes receivable allowance for credit losses: (in thousands) September 30, 2022 December 31, 2021 Beginning balance $ 16,779 $ 19,484 Provision for credit losses 303 709 Write-offs (5,669) (3,414) Ending balance $ 11,413 $ 16,779 |
Schedule of Past Due Balances of Notes Receivable | The past due balances by credit quality indicator of notes receivable are as follows: (in thousands) 1- 30 days 31-89 days > 90 days Total Current Total As of September 30, 2022 Senior $ — $ — $ 15,188 $ 15,188 $ 80,313 $ 95,501 Subordinated — — 2,209 2,209 15,197 17,406 Unsecured 20 40 20 80 5,299 5,379 $ 20 $ 40 $ 17,417 $ 17,477 $ 100,809 $ 118,286 As of December 31, 2021 Senior $ — $ — $ — $ — $ 108,370 $ 108,370 Subordinated — — 2,209 2,209 25,592 27,801 Unsecured — — — — 1,512 1,512 $ — $ — $ 2,209 $ 2,209 $ 135,474 $ 137,683 |
Debt (Tables)
Debt (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Debt Disclosure [Abstract] | |
Schedule of Components of Debt | Debt consists of the following: September 30, 2022 December 31, 2021 (in thousands) $450 million senior unsecured notes due 2031 ("2020 Senior Notes") with an effective interest rate of 3.86%, less a discount and deferred issuance costs of $5.1 million and $5.5 million at September 30, 2022 and December 31, 2021, respectively $ 444,927 $ 444,470 $400 million senior unsecured notes due 2029 ("2019 Senior Notes") with an effective interest rate of 3.88%, less a discount and deferred issuance costs of $4.3 million and $4.8 million at September 30, 2022 and December 31, 2021, respectively 395,688 395,237 $216.6 million senior unsecured notes due 2022 ("2012 Senior Notes") with an effective interest rate of 6.00%, less deferred issuance costs of $0.2 million at December 31, 2021 (1) — 216,351 $600 million senior unsecured revolving credit facility with an effective interest rate of 3.89% less deferred issuance costs of $1.9 million and $2.3 million at September 30, 2022 and December 31, 2021, respectively 313,087 — Economic development loans with an effective interest rate of 3.00% at September 30, 2022 and December 31, 2021, respectively 4,416 4,416 Total debt (2) $ 1,158,118 $ 1,060,474 Less current portion (1) 2,976 216,351 Long-term debt $ 1,155,142 $ 844,123 (1) The 2012 Senior Notes matured on July 1, 2022. The outstanding principal of $216.6 million was re-paid at maturity. |
Accumulated Other Comprehensi_2
Accumulated Other Comprehensive Loss (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract] | |
Schedule of Changes in Accumulated Other Comprehensive Loss | The changes in accumulated other comprehensive loss, net of tax, for the nine months ended September 30, 2022 and 2021 are as follows: (in thousands) Balance as of December 31, 2021 $ (4,574) Other comprehensive income (loss) before reclassification (1,139) Net current period other comprehensive income (loss) (1,139) Balance as of September 30, 2022 $ (5,713) (in thousands) Balance as of December 31, 2020 $ (4,646) Other comprehensive income (loss) before reclassification 66 Net current period other comprehensive income (loss) 66 Balance as of September 30, 2021 $ (4,580) |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Fair Value Disclosures [Abstract] | |
Schedule of Fair Value of Assets | As of September 30, 2022 and December 31, 2021, the Company had the following assets recorded in the consolidated balance sheets measured at fair value on a recurring basis: Fair Value Measurements at Reporting Date Using (in thousands) Total Level 1 Level 2 Level 3 As of September 30, 2022 Mutual funds (1) $ 26,822 $ 26,822 $ — $ — Money market funds (1) 3,042 — 3,042 — Total $ 29,864 $ 26,822 $ 3,042 $ — As of December 31, 2021 Mutual funds (1) $ 33,555 $ 33,555 $ — $ — Money market funds (1) 2,520 — 2,520 — Total $ 36,075 $ 33,555 $ 2,520 $ — (1) Included in Investments, employee benefit plans, at fair value and Prepaid expenses and other current assets on the consolidated balance sheets. |
Schedule of Carrying Amounts and Fair Values | At September 30, 2022 and December 31, 2021, the carrying amounts and fair values are as follows: September 30, 2022 December 31, 2021 (in thousands) Carrying Amount Fair Value Carrying Amount Fair Value 2020 Senior Notes $ 444,927 $ 371,682 $ 444,470 $ 477,675 2019 Senior Notes 395,688 336,860 395,237 425,984 2012 Senior Notes — — 216,351 221,702 |
Share-Based Compensation and _2
Share-Based Compensation and Capital Stock (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Share-Based Payment Arrangement [Abstract] | |
Schedule of Pre-Tax Stock-Based Compensation Expenses | The components of the Company’s pretax share-based compensation activity are as follows for the three and nine months ended September 30, 2022 and 2021: Three Months Ended September 30, Nine Months Ended September 30, (in thousands) 2022 2021 2022 2021 Stock options $ 1,216 $ 933 $ 3,445 $ 2,482 Restricted stock awards 3,763 2,285 10,364 7,126 Performance vested restricted stock units 4,887 2,950 13,051 7,760 Total share-based compensation expense $ 9,866 $ 6,168 $ 26,860 $ 17,368 |
Schedule of Change In Stock-Based Award Activity | A summary of share-based award activity as of and changes during the nine months ended September 30, 2022 are presented below: Stock Options Restricted Stock Performance Vested Options Weighted Weighted Shares Weighted Shares Weighted Outstanding at January 1, 2022 910,944 $ 83.14 236,599 $ 92.60 412,642 $ 114.70 Granted 172,441 143.91 267,206 144.45 111,585 181.91 Performance-Based Leveraging (1) — — — — 27,775 153.75 Exercised/Vested (43,934) 53.70 (95,130) 87.23 — — Expired (986) 51.49 — — (78,370) 81.15 Forfeited (3,255) 131.73 (11,433) 106.12 (3,819) 125.04 Outstanding at September 30, 2022 1,035,210 $ 94.39 5.7 397,242 $ 128.38 469,813 $ 136.32 Options exercisable at September 30, 2022 546,114 $ 76.29 3.5 |
Schedule of Weighted Average Assumptions of Black-Scholes Option-Pricing Model | The fair value of the options granted was estimated on the grant date using the Black-Scholes option-pricing model with the following weighted average assumptions: 2022 Grants Risk-free interest rate 2.01 % Expected volatility 29.46 % Expected life of stock option 5.9 years Dividend yield 0.66 % Requisite service period 4 years Contractual life 10 years Weighted average fair value of options granted (per option) $ 42.66 |
Earnings Per Share (Tables)
Earnings Per Share (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Earnings Per Share [Abstract] | |
Schedule of Computation of Basic and Diluted Earnings Per Common Share | The computation of basic and diluted earnings per share of common stock is as follows: Three Months Ended Nine Months Ended September 30, September 30, (in thousands, except per share amounts) 2022 2021 2022 2021 Numerator: Net income $ 103,080 $ 116,655 $ 276,639 $ 224,874 Income allocated to participating securities (614) (420) (1,526) (910) Net income available to common shareholders $ 102,466 $ 116,235 $ 275,113 $ 223,964 Denominator: Weighted average shares of common stock outstanding – basic 54,847 55,427 55,233 55,360 Basic earnings per share $ 1.87 $ 2.10 $ 4.98 $ 4.05 Numerator: Net income $ 103,080 $ 116,655 $ 276,639 $ 224,874 Income allocated to participating securities (614) (420) (1,526) (910) Net income available to common shareholders $ 102,466 $ 116,235 $ 275,113 $ 223,964 Denominator: Weighted average shares of common stock outstanding – basic 54,847 55,427 55,233 55,360 Dilutive effect of stock options and PVRSUs 395 478 520 429 Weighted average shares of common stock outstanding – diluted 55,242 55,905 55,753 55,789 Diluted earnings per share $ 1.85 $ 2.08 $ 4.93 $ 4.01 |
Schedule of Antidilutive Securities Excluded from Computation of Earnings Per Share | The following securities have been excluded from the calculation of diluted weighted average shares of common stock outstanding as the inclusion of these securities would have an anti-dilutive effect: Three Months Ended Nine Months Ended September 30, September 30, (in thousands) 2022 2021 2022 2021 Stock options 170 — 154 — PVRSUs 75 155 75 155 |
Reportable Segment Information
Reportable Segment Information (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Segment Reporting [Abstract] | |
Schedule of Financial Information for Company's Franchising Segment | The following table presents the financial information for the Company's segments: Three Months Ended September 30, 2022 Three Months Ended September 30, 2021 (in thousands) Hotel Corporate & Intersegment Eliminations Consolidated Hotel Corporate & Intersegment Eliminations Consolidated Revenues $ 386,124 $ 29,692 $ (1,550) $ 414,266 $ 310,703 $ 13,532 $ (866) $ 323,369 Operating income (loss) $ 161,084 $ (16,066) $ — $ 145,018 $ 169,516 $ (10,410) $ — $ 159,106 Income (loss) before income taxes $ 162,162 $ (25,386) $ — $ 136,776 $ 172,338 $ (20,749) $ — $ 151,589 Nine Months Ended September 30, 2022 Nine Months Ended September 30, 2021 (in thousands) Hotel Corporate & Intersegment Eliminations Consolidated Hotel Corporate & Intersegment Eliminations Consolidated Revenues $ 980,352 $ 63,363 $ (3,748) $ 1,039,967 $ 756,013 $ 30,504 $ (1,857) $ 784,660 Operating income (loss) $ 433,852 $ (32,088) $ — $ 401,764 $ 360,269 $ (38,141) $ — $ 322,128 Income (loss) before income taxes $ 435,131 $ (68,494) $ — $ 366,637 $ 358,274 $ (66,121) $ — $ 292,153 |
Acquisitions (Tables)
Acquisitions (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Business Combination and Asset Acquisition [Abstract] | |
Schedule of Recognized Identified Assets Acquired and Liabilities Assumed | The preliminary allocation of the purchase price, as presented in our Consolidated Balance Sheet: Assets acquired Amount Cash and cash equivalents $ 113,023 Restricted cash 10,403 Accounts receivable 32,972 Notes receivables - current 1,709 Prepaid expenses and other current assets 8,139 Property and equipment 125,441 Operating lease right-of-use of assets 42,315 Intangible assets 447,400 Notes receivable - noncurrent 2,592 Investment in affiliates 471 Other assets 2,129 Total assets acquired $ 786,594 Liabilities assumed Accounts payable 8,295 Accrued expenses and other current liabilities 15,987 Deferred revenue - current (1) 5,745 Liability for guest loyalty program - current (1) 3,542 Long-term debt 55,975 Long-term deferred revenue (1) 26,499 Deferred compensation and retirement plan obligations 9,265 Operating lease liabilities 42,705 Liability for guest loyalty program - noncurrent (1) 10,180 Other liabilities 3,052 Total liabilities assumed $ 181,245 Fair value of net assets acquired $ 605,349 Goodwill 68,507 Total purchase consideration $ 673,856 (1) The Deferred revenue (including deferred affiliation fees) and Liability for guest loyalty program balances were assumed at their carrying value at the date of the acquisition pursuant to the application of ASU 2021-08 (see Note 1). The following table presents the preliminary estimates of fair value of the acquired property and equipment, which is primarily concentrated at three acquired hotel properties, and their estimated weighted average remaining useful lives. Estimated Useful Life Estimated Fair Value (in years) (in thousands) Land N/A $ 7,159 Construction in progress N/A 3,190 Building and leasehold improvements 24.4 93,934 Site improvements 23.1 586 Furniture, fixtures and equipment 3.9 8,334 Computer equipment and software 2.0 12,238 Total $ 125,441 The following table presents our preliminary estimates of the fair value of the acquired identified intangible assets and their estimated useful lives: Estimated Useful Life Estimated Fair Value (in years) (in thousands) Trade names N/A $ 223,700 Franchise agreements 15.5 220,400 Management agreements 15.5 3,300 Total $ 447,400 |
Schedule of Pro Forma Information | The following unaudited pro forma information presents the combined results of operations of Choice and Radisson Hotels Americas as if we had completed the Transaction on January 1, 2021, but using our preliminary fair values of assets acquired and liabilities assumed as of the acquisition date. The unaudited pro forma information reflects adjustments relating to (i) the allocation of purchase price and related adjustments, including incremental depreciation and amortization expense based on the preliminary fair values of the property and equipment assets and intangible assets acquired; (ii) the incremental impact of the Revolver draw on interest expense and amortization of financing costs; (iii) nonrecurring transaction costs; and (iv) income tax impact of the aforementioned pro forma adjustments. As required by GAAP, these unaudited pro forma results do not reflect any cost saving synergies from operating efficiencies. Accordingly, these unaudited pro forma results are presented for informational purposes only and are not necessarily indicative of what the actual results of operations of the combined company would have been if the transaction had occurred at the beginning of the period presented, nor are they indicative of future results of operations. Nine Months Ended September 30, (in thousands) 2022 2021 Revenues $ 1,189,792 $ 928,669 Net income 304,770 173,822 (in thousands) August 11, 2022 - September 30, 2022 Revenues $ 40,203 Net income (loss) (1,380) |
Schedule of Goodwill | The following table details the carrying amount of the Company's goodwill, including goodwill arising from the acquisition of Radisson Hotels Americas, as of September 30, 2022. (in thousands) September 30, 2022 Goodwill, excluding goodwill arising from Radisson Hotels Americas acquisition $ 166,774 Accumulated impairment losses (7,578) Goodwill arising from Radisson Hotels Americas acquisition 68,507 Goodwill, net carrying amount $ 227,703 |
Basis of Presentation and Sig_3
Basis of Presentation and Significant Accounting Policies (Details) | Sep. 30, 2022 brand | Aug. 11, 2022 room |
Business Acquisition [Line Items] | ||
Number of brands | brand | 23 | |
Radisson Hotels Americas | ||
Business Acquisition [Line Items] | ||
Number of rooms | room | 67,000 |
Revenue - Narrative (Details)
Revenue - Narrative (Details) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 USD ($) unit | Sep. 30, 2021 USD ($) | Sep. 30, 2022 USD ($) unit | Sep. 30, 2021 USD ($) | |
Disaggregation of Revenue [Line Items] | ||||
Revenue, remaining performance obligation | $ 203,300 | $ 203,300 | ||
Revenues | $ 414,266 | $ 323,369 | 1,039,967 | $ 784,660 |
Loss on contract termination | $ 67,400 | |||
WoodSpring | ||||
Disaggregation of Revenue [Line Items] | ||||
Number of properties | unit | 110 | 110 | ||
Loss on contract termination | $ 22,600 | |||
Royalty, licensing and management fees | ||||
Disaggregation of Revenue [Line Items] | ||||
Redemption of loyalty points period | 3 years | |||
Revenues | 144,020 | 127,317 | $ 356,208 | 299,606 |
Corporate & Other | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | 29,692 | 13,532 | 63,363 | 30,504 |
Corporate & Other | Over time | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | 29,700 | 13,500 | 63,400 | 30,500 |
Intersegment Eliminations | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | (1,550) | (866) | (3,748) | (1,857) |
Intersegment Eliminations | Royalty, licensing and management fees | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | $ 1,600 | $ 900 | $ 3,700 | $ 1,900 |
Minimum | ||||
Disaggregation of Revenue [Line Items] | ||||
Deferred revenue, recognition period | 5 years | |||
Maximum | ||||
Disaggregation of Revenue [Line Items] | ||||
Deferred revenue, recognition period | 10 years |
Revenue - Contract Liability (D
Revenue - Contract Liability (Details) $ in Thousands | 9 Months Ended |
Sep. 30, 2022 USD ($) | |
Changes in Contract Liability [Roll Forward] | |
Balance as of December 31, 2021 | $ 175,425 |
Assumption of contract liabilities from Radisson Hotels Americas acquisition | 30,031 |
Increases to the contract liability balance due to cash received | 84,356 |
Revenue recognized in the period | (86,473) |
Balance as of September 30, 2022 | $ 203,339 |
Revenue - Disaggregation of Rev
Revenue - Disaggregation of Revenue (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | ||||
Revenue | $ 414,243 | $ 323,258 | $ 1,039,737 | $ 784,328 |
Total revenues | 414,266 | 323,369 | 1,039,967 | 784,660 |
Over time | ||||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | ||||
Revenue | 389,261 | 309,226 | 953,125 | 740,683 |
Point in time | ||||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | ||||
Revenue | 24,982 | 14,032 | 86,612 | 43,645 |
Royalty, licensing and management fees | ||||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | ||||
Revenue | 144,020 | 127,317 | 356,208 | 299,606 |
Total revenues | 144,020 | 127,317 | 356,208 | 299,606 |
Royalty, licensing and management fees | Over time | ||||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | ||||
Revenue | 143,987 | 127,317 | 356,175 | 299,606 |
Royalty, licensing and management fees | Point in time | ||||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | ||||
Revenue | 33 | 0 | 33 | 0 |
Initial franchise fees | ||||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | ||||
Revenue | 7,011 | 6,149 | 21,635 | 18,904 |
Total revenues | 7,011 | 6,149 | 21,635 | 18,904 |
Initial franchise fees | Over time | ||||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | ||||
Revenue | 7,011 | 6,149 | 21,635 | 18,904 |
Initial franchise fees | Point in time | ||||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | ||||
Revenue | 0 | 0 | 0 | 0 |
Procurement services | ||||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | ||||
Revenue | 14,401 | 13,010 | 47,887 | 36,293 |
Total revenues | 14,401 | 13,010 | 47,887 | 36,293 |
Procurement services | Over time | ||||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | ||||
Revenue | 13,628 | 12,285 | 45,503 | 34,526 |
Procurement services | Point in time | ||||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | ||||
Revenue | 773 | 725 | 2,384 | 1,767 |
Owned hotels | ||||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | ||||
Revenue | 19,969 | 11,266 | 48,990 | 24,392 |
Total revenues | 19,992 | 11,377 | 49,220 | 24,724 |
Owned hotels | Over time | ||||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | ||||
Revenue | 14,854 | 9,614 | 39,490 | 20,683 |
Owned hotels | Point in time | ||||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | ||||
Revenue | 5,115 | 1,652 | 9,500 | 3,709 |
Other | ||||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | ||||
Total revenues | 31,432 | 8,645 | 51,588 | 20,753 |
Total Topic 606 revenues | ||||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | ||||
Revenue | 31,432 | 8,645 | 51,588 | 20,753 |
Total Topic 606 revenues | Over time | ||||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | ||||
Revenue | 31,432 | 8,645 | 51,588 | 20,753 |
Total Topic 606 revenues | Point in time | ||||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | ||||
Revenue | 0 | 0 | 0 | 0 |
Non-Topic 606 revenues | ||||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | ||||
Non-Topic 606 revenues | 23 | 111 | 230 | 332 |
Other revenues from franchised and managed properties | ||||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | ||||
Revenue | 197,410 | 156,871 | 513,429 | 384,380 |
Total revenues | 197,410 | 156,871 | 513,429 | 384,380 |
Other revenues from franchised and managed properties | Over time | ||||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | ||||
Revenue | 178,349 | 145,216 | 438,734 | 346,211 |
Other revenues from franchised and managed properties | Point in time | ||||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | ||||
Revenue | $ 19,061 | $ 11,655 | $ 74,695 | $ 38,169 |
Receivables and Allowance for_3
Receivables and Allowance for Credit Losses - Schedule Of Notes Receivable (Details) - USD ($) $ in Thousands | Sep. 30, 2022 | Dec. 31, 2021 | Dec. 31, 2020 |
Notes Receivable and Allowance for Losses [Line Items] | |||
Notes receivable | $ 118,286 | $ 137,683 | |
Total allowance for notes receivable credit losses | 11,413 | 16,779 | $ 19,484 |
Total notes receivable, net of allowance | 106,873 | 120,904 | |
Current portion, net of allowance | 52,381 | 54,453 | |
Long-term portion, net of allowance | 54,492 | 66,451 | |
Senior | |||
Notes Receivable and Allowance for Losses [Line Items] | |||
Notes receivable | 95,501 | 108,370 | |
Subordinated | |||
Notes Receivable and Allowance for Losses [Line Items] | |||
Notes receivable | 17,406 | 27,801 | |
Unsecured | |||
Notes Receivable and Allowance for Losses [Line Items] | |||
Notes receivable | $ 5,379 | $ 1,512 |
Receivables and Allowance for_4
Receivables and Allowance for Credit Losses - Credit Quality Indicator (Details) - USD ($) $ in Thousands | Sep. 30, 2022 | Dec. 31, 2021 |
Notes Receivable and Allowance for Losses [Line Items] | ||
2022 | $ 424 | |
2021 | 9,947 | |
2020 | 1,131 | |
Prior | 106,784 | |
Total | 118,286 | $ 137,683 |
Senior | ||
Notes Receivable and Allowance for Losses [Line Items] | ||
2022 | 0 | |
2021 | 7,838 | |
2020 | 0 | |
Prior | 87,663 | |
Total | 95,501 | 108,370 |
Subordinated | ||
Notes Receivable and Allowance for Losses [Line Items] | ||
2022 | 0 | |
2021 | 0 | |
2020 | 0 | |
Prior | 17,406 | |
Total | 17,406 | 27,801 |
Unsecured | ||
Notes Receivable and Allowance for Losses [Line Items] | ||
2022 | 424 | |
2021 | 2,109 | |
2020 | 1,131 | |
Prior | 1,715 | |
Total | $ 5,379 | $ 1,512 |
Receivables and Allowance for_5
Receivables and Allowance for Credit Losses - Allowance for Credit Loss Rollforward (Details) - USD ($) $ in Thousands | 9 Months Ended | 12 Months Ended |
Sep. 30, 2022 | Dec. 31, 2021 | |
Financing Receivable, Allowance for Credit Loss [Roll Forward] | ||
Beginning balance | $ 16,779 | $ 19,484 |
Provision for credit losses | 303 | 709 |
Write-offs | (5,669) | (3,414) |
Ending balance | $ 11,413 | $ 16,779 |
Receivables and Allowance for_6
Receivables and Allowance for Credit Losses - Narrative (Details) $ in Thousands | 9 Months Ended | 12 Months Ended | |||
Sep. 30, 2022 USD ($) loan | Sep. 30, 2021 USD ($) | Dec. 31, 2021 USD ($) loan | Aug. 11, 2022 USD ($) | Dec. 31, 2020 USD ($) | |
Notes Receivable and Allowance for Losses [Line Items] | |||||
Total allowance for notes receivable credit losses | $ 11,413 | $ 16,779 | $ 19,484 | ||
Loans and financing receivable | 54,492 | 66,451 | |||
Allowance for credit loss | 12,900 | $ 5,500 | |||
Radisson Hotels Americas | |||||
Notes Receivable and Allowance for Losses [Line Items] | |||||
Accounts receivable | $ 32,972 | ||||
Variable Interest Entity, Not Primary Beneficiary | |||||
Notes Receivable and Allowance for Losses [Line Items] | |||||
Loans and financing receivable | 102,300 | 120,200 | |||
SG&A expenses | |||||
Notes Receivable and Allowance for Losses [Line Items] | |||||
Provision for (reversal of) credit losses | (400) | (2,200) | |||
Marketing and reservation system expenses | |||||
Notes Receivable and Allowance for Losses [Line Items] | |||||
Provision for (reversal of) credit losses | 500 | $ 4,200 | |||
Interest Rate Below Market Reduction | Variable Interest Entity, Not Primary Beneficiary | |||||
Notes Receivable and Allowance for Losses [Line Items] | |||||
Loans and financing receivable | 4,800 | 7,500 | |||
Receivable with imputed interest, discount | $ 100 | $ 300 | |||
Collateral-Dependent Loans | |||||
Notes Receivable and Allowance for Losses [Line Items] | |||||
Number of loans | loan | 1 | 2 | |||
Total allowance for notes receivable credit losses | $ 900 | $ 6,300 | |||
Impaired Loans | |||||
Notes Receivable and Allowance for Losses [Line Items] | |||||
Nonaccrual status | $ 18,200 | $ 44,100 |
Receivables and Allowance for_7
Receivables and Allowance for Credit Losses - Past Due Balances Of Mezzanine And Other Notes Receivable (Details) - USD ($) $ in Thousands | Sep. 30, 2022 | Dec. 31, 2021 |
Financing Receivable, Past Due [Line Items] | ||
Notes receivable | $ 118,286 | $ 137,683 |
Senior | ||
Financing Receivable, Past Due [Line Items] | ||
Notes receivable | 95,501 | 108,370 |
Subordinated | ||
Financing Receivable, Past Due [Line Items] | ||
Notes receivable | 17,406 | 27,801 |
Unsecured | ||
Financing Receivable, Past Due [Line Items] | ||
Notes receivable | 5,379 | 1,512 |
Total Past Due | ||
Financing Receivable, Past Due [Line Items] | ||
Notes receivable | 17,477 | 2,209 |
Total Past Due | Senior | ||
Financing Receivable, Past Due [Line Items] | ||
Notes receivable | 15,188 | 0 |
Total Past Due | Subordinated | ||
Financing Receivable, Past Due [Line Items] | ||
Notes receivable | 2,209 | 2,209 |
Total Past Due | Unsecured | ||
Financing Receivable, Past Due [Line Items] | ||
Notes receivable | 80 | 0 |
1- 30 days Past Due | ||
Financing Receivable, Past Due [Line Items] | ||
Notes receivable | 20 | 0 |
1- 30 days Past Due | Senior | ||
Financing Receivable, Past Due [Line Items] | ||
Notes receivable | 0 | 0 |
1- 30 days Past Due | Subordinated | ||
Financing Receivable, Past Due [Line Items] | ||
Notes receivable | 0 | 0 |
1- 30 days Past Due | Unsecured | ||
Financing Receivable, Past Due [Line Items] | ||
Notes receivable | 20 | 0 |
31-89 days Past Due | ||
Financing Receivable, Past Due [Line Items] | ||
Notes receivable | 40 | 0 |
31-89 days Past Due | Senior | ||
Financing Receivable, Past Due [Line Items] | ||
Notes receivable | 0 | 0 |
31-89 days Past Due | Subordinated | ||
Financing Receivable, Past Due [Line Items] | ||
Notes receivable | 0 | 0 |
31-89 days Past Due | Unsecured | ||
Financing Receivable, Past Due [Line Items] | ||
Notes receivable | 40 | 0 |
> 90 days Past Due | ||
Financing Receivable, Past Due [Line Items] | ||
Notes receivable | 17,417 | 2,209 |
> 90 days Past Due | Senior | ||
Financing Receivable, Past Due [Line Items] | ||
Notes receivable | 15,188 | 0 |
> 90 days Past Due | Subordinated | ||
Financing Receivable, Past Due [Line Items] | ||
Notes receivable | 2,209 | 2,209 |
> 90 days Past Due | Unsecured | ||
Financing Receivable, Past Due [Line Items] | ||
Notes receivable | 20 | 0 |
Current | ||
Financing Receivable, Past Due [Line Items] | ||
Notes receivable | 100,809 | 135,474 |
Current | Senior | ||
Financing Receivable, Past Due [Line Items] | ||
Notes receivable | 80,313 | 108,370 |
Current | Subordinated | ||
Financing Receivable, Past Due [Line Items] | ||
Notes receivable | 15,197 | 25,592 |
Current | Unsecured | ||
Financing Receivable, Past Due [Line Items] | ||
Notes receivable | $ 5,299 | $ 1,512 |
Investments in Affiliates (Deta
Investments in Affiliates (Details) | 3 Months Ended | 9 Months Ended | |||||
Sep. 30, 2022 USD ($) | Sep. 30, 2021 USD ($) | Jun. 30, 2021 USD ($) investment | Mar. 31, 2021 USD ($) | Sep. 30, 2022 USD ($) | Sep. 30, 2021 USD ($) | Dec. 31, 2021 USD ($) | |
Variable Interest Entity [Line Items] | |||||||
Investments in joint ventures included in unconsolidated entities | $ 2,188,983,000 | $ 2,188,983,000 | $ 1,931,824,000 | ||||
Equity method investment impairment | 0 | ||||||
Number of securities sold | investment | 3 | ||||||
Equity method investment, realized net loss (gain) of affiliates | $ 4,300,000 | $ 2,600,000 | |||||
Hotel Franchising | |||||||
Variable Interest Entity [Line Items] | |||||||
Equity method investment impairment | $ 4,800,000 | ||||||
Variable Interest Entity, Not Primary Beneficiary | |||||||
Variable Interest Entity [Line Items] | |||||||
Investments in joint ventures included in unconsolidated entities | 24,400,000 | 24,400,000 | $ 25,200,000 | ||||
Losses (gains) attributable to variable interest entities | $ 1,100,000 | $ (2,500,000) | $ 2,700,000 | $ 3,000,000 |
Debt - Schedule Of Components O
Debt - Schedule Of Components Of Debt (Details) - USD ($) | 9 Months Ended | |||
Jul. 01, 2022 | Sep. 30, 2022 | Sep. 30, 2021 | Dec. 31, 2021 | |
Debt [Line Items] | ||||
Long-term debt | $ 1,158,118,000 | $ 1,060,474,000 | ||
Less current portion | 2,976,000 | 216,351,000 | ||
Long-term debt | 1,155,142,000 | $ 844,123,000 | ||
Repayment of debt | $ 216,571,000 | $ 0 | ||
Economic Development Loans | ||||
Debt [Line Items] | ||||
Debt instrument effective interest rate | 3% | 3% | ||
Long-term debt | $ 4,416,000 | $ 4,416,000 | ||
$450 Million Senior Unsecured Notes Due 2031 | Senior | ||||
Debt [Line Items] | ||||
Debt instrument face amount | $ 450,000,000 | $ 450,000,000 | ||
Debt instrument effective interest rate | 3.86% | 3.86% | ||
Deferred issuance costs | $ 5,100,000 | $ 5,500,000 | ||
Long-term debt | 444,927,000 | 444,470,000 | ||
$400 Million Senior Unsecured Notes Due 2029 | Senior | ||||
Debt [Line Items] | ||||
Debt instrument face amount | $ 400,000,000 | $ 400,000,000 | ||
Debt instrument effective interest rate | 3.88% | 3.88% | ||
Deferred issuance costs | $ 4,300,000 | $ 4,800,000 | ||
Long-term debt | 395,688,000 | 395,237,000 | ||
$216.6 Million Senior Unsecured Notes 2022 | Senior | ||||
Debt [Line Items] | ||||
Debt instrument face amount | $ 216,600,000 | $ 216,600,000 | ||
Debt instrument effective interest rate | 6% | 6% | ||
Deferred issuance costs | $ 200,000 | |||
Long-term debt | $ 0 | 216,351,000 | ||
Repayment of debt | $ 216,600,000 | |||
$600 Million Unsecured Revolving Credit Facility | Senior | ||||
Debt [Line Items] | ||||
Debt instrument face amount | $ 600,000,000 | $ 600,000,000 | ||
Debt instrument effective interest rate | 3.89% | 3.89% | ||
Deferred issuance costs | $ 1,900,000 | $ 2,300,000 | ||
Long-term debt | $ 313,087,000 | $ 0 |
Accumulated Other Comprehensi_3
Accumulated Other Comprehensive Loss - Changes in Accumulated Other Comprehensive Loss, Net of Tax (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||||||
Sep. 30, 2022 | Jun. 30, 2022 | Mar. 31, 2022 | Sep. 30, 2021 | Jun. 30, 2021 | Mar. 31, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Accumulated Other Comprehensive Income (Loss) [Roll Forward] | ||||||||
Beginning balance | $ 416,725 | $ 314,645 | $ 265,882 | $ 104,933 | $ 19,235 | $ (5,752) | $ 265,882 | $ (5,752) |
Other comprehensive income (loss) before reclassification | (1,139) | 66 | ||||||
Other comprehensive income (loss), net of tax | (902) | (103) | (134) | (57) | 71 | 52 | (1,139) | 66 |
Ending balance | 284,511 | 416,725 | 314,645 | 212,146 | 104,933 | 19,235 | 284,511 | 212,146 |
Accumulated Other Comprehensive Income (Loss) | ||||||||
Accumulated Other Comprehensive Income (Loss) [Roll Forward] | ||||||||
Beginning balance | (4,811) | (4,708) | (4,574) | (4,523) | (4,594) | (4,646) | (4,574) | (4,646) |
Other comprehensive income (loss), net of tax | (902) | (103) | (134) | (57) | 71 | 52 | ||
Ending balance | $ (5,713) | $ (4,811) | $ (4,708) | $ (4,580) | $ (4,523) | $ (4,594) | $ (5,713) | $ (4,580) |
Fair Value Measurements - Sched
Fair Value Measurements - Schedule Of Fair Value Of Assets (Details) - Fair value, measurements, recurring - USD ($) $ in Thousands | Sep. 30, 2022 | Dec. 31, 2021 |
Fair Value Measurements [Line Items] | ||
Total | $ 29,864 | $ 36,075 |
Mutual funds | Investments, employee benefit plans, at fair value | ||
Fair Value Measurements [Line Items] | ||
Mutual funds and money market funds, fair value | 26,822 | 33,555 |
Money market funds | Investments, employee benefit plans, at fair value | ||
Fair Value Measurements [Line Items] | ||
Mutual funds and money market funds, fair value | 3,042 | 2,520 |
Level 1 | ||
Fair Value Measurements [Line Items] | ||
Total | 26,822 | 33,555 |
Level 1 | Mutual funds | Investments, employee benefit plans, at fair value | ||
Fair Value Measurements [Line Items] | ||
Mutual funds and money market funds, fair value | 26,822 | 33,555 |
Level 1 | Money market funds | Investments, employee benefit plans, at fair value | ||
Fair Value Measurements [Line Items] | ||
Mutual funds and money market funds, fair value | 0 | 0 |
Level 2 | ||
Fair Value Measurements [Line Items] | ||
Total | 3,042 | 2,520 |
Level 2 | Mutual funds | Investments, employee benefit plans, at fair value | ||
Fair Value Measurements [Line Items] | ||
Mutual funds and money market funds, fair value | 0 | 0 |
Level 2 | Money market funds | Investments, employee benefit plans, at fair value | ||
Fair Value Measurements [Line Items] | ||
Mutual funds and money market funds, fair value | 3,042 | 2,520 |
Level 3 | ||
Fair Value Measurements [Line Items] | ||
Total | 0 | 0 |
Level 3 | Mutual funds | Investments, employee benefit plans, at fair value | ||
Fair Value Measurements [Line Items] | ||
Mutual funds and money market funds, fair value | 0 | 0 |
Level 3 | Money market funds | Investments, employee benefit plans, at fair value | ||
Fair Value Measurements [Line Items] | ||
Mutual funds and money market funds, fair value | $ 0 | $ 0 |
Fair Value Measurements - Carry
Fair Value Measurements - Carrying Amounts and Fair Values (Details) - USD ($) $ in Thousands | Sep. 30, 2022 | Dec. 31, 2021 |
Fair Value Measurements [Line Items] | ||
Long-term debt | $ 1,158,118 | $ 1,060,474 |
Senior | 2020 Senior Notes | ||
Fair Value Measurements [Line Items] | ||
Long-term debt | 444,927 | 444,470 |
Senior | 2020 Senior Notes | Level 2 | Carrying Amount | ||
Fair Value Measurements [Line Items] | ||
Long-term debt | 444,927 | 444,470 |
Senior | 2020 Senior Notes | Level 2 | Fair Value | ||
Fair Value Measurements [Line Items] | ||
Long-term debt | 371,682 | 477,675 |
Senior | 2019 Senior Notes | ||
Fair Value Measurements [Line Items] | ||
Long-term debt | 395,688 | 395,237 |
Senior | 2019 Senior Notes | Level 2 | Carrying Amount | ||
Fair Value Measurements [Line Items] | ||
Long-term debt | 395,688 | 395,237 |
Senior | 2019 Senior Notes | Level 2 | Fair Value | ||
Fair Value Measurements [Line Items] | ||
Long-term debt | 336,860 | 425,984 |
Senior | 2012 Senior Notes | Level 2 | Carrying Amount | ||
Fair Value Measurements [Line Items] | ||
Long-term debt | 0 | 216,351 |
Senior | 2012 Senior Notes | Level 2 | Fair Value | ||
Fair Value Measurements [Line Items] | ||
Long-term debt | $ 0 | $ 221,702 |
Income Taxes - Narrative (Detai
Income Taxes - Narrative (Details) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Income Tax Disclosure [Abstract] | ||||
Effective income tax rate (percent) | 24.60% | 23.10% | 24.50% | 23% |
Share-Based Compensation and _3
Share-Based Compensation and Capital Stock - Pre-Tax Stock-Based Compensation Expenses And Associated Income Tax Benefits (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Share-Based Compensation and Capital Stock [Line Items] | ||||
Total share-based compensation expense | $ 9,866 | $ 6,168 | $ 26,860 | $ 17,368 |
Stock options | ||||
Share-Based Compensation and Capital Stock [Line Items] | ||||
Total share-based compensation expense | 1,216 | 933 | 3,445 | 2,482 |
Restricted stock awards | ||||
Share-Based Compensation and Capital Stock [Line Items] | ||||
Total share-based compensation expense | 3,763 | 2,285 | 10,364 | 7,126 |
Performance Vested Restricted Stock Units | ||||
Share-Based Compensation and Capital Stock [Line Items] | ||||
Total share-based compensation expense | $ 4,887 | $ 2,950 | $ 13,051 | $ 7,760 |
Share-Based Compensation and _4
Share-Based Compensation and Capital Stock - Summary of Change in Stock-Based Award Activity (Details) | 9 Months Ended |
Sep. 30, 2022 $ / shares shares | |
Stock Options | |
Options | |
Outstanding, beginning balance (in shares) | shares | 910,944 |
Granted (in shares) | shares | 172,441 |
Performance-Based Leveraging (in shares) | shares | 0 |
Exercised/Vested (in shares) | shares | (43,934) |
Expired (in shares) | shares | (986) |
Forfeited (in shares) | shares | (3,255) |
Outstanding, ending balance (in shares) | shares | 1,035,210 |
Options exercisable (in shares) | shares | 546,114 |
Weighted Average Exercise Price | |
Beginning balance (in usd per share) | $ / shares | $ 83.14 |
Granted (in usd per share) | $ / shares | 143.91 |
Performance-Based Leveraging (in usd per share) | $ / shares | 0 |
Exercised/Vested (in usd per share) | $ / shares | 53.70 |
Expired (in usd per share) | $ / shares | 51.49 |
Forfeited (in usd per share) | $ / shares | 131.73 |
Ending balance (in usd per share) | $ / shares | 94.39 |
Options exercisable - weighted average exercise price (in usd per share) | $ / shares | $ 76.29 |
Weighted Average Remaining Contractual Term | |
Outstanding | 5 years 8 months 12 days |
Options exercisable | 3 years 6 months |
Restricted Stock | |
Restricted Stock and Performance Vested Restricted Stock Units, Shares | |
Outstanding, beginning balance (in shares) | shares | 236,599 |
Granted (in shares) | shares | 267,206 |
Performance-Based Leveraging (in shares) | shares | 0 |
Exercised/Vested (in shares) | shares | (95,130) |
Expired (in shares) | shares | 0 |
Forfeited (in shares) | shares | (11,433) |
Outstanding, ending balance (in shares) | shares | 397,242 |
Restricted Stock and Performance Vested Restricted Stock Units, Weighted Average Grant Date Fair Value | |
Outstanding, beginning balance (in usd per share) | $ / shares | $ 92.60 |
Granted (in usd per share) | $ / shares | 144.45 |
Performance-Based Leveraging (in usd per share) | $ / shares | 0 |
Exercised/Vested (in usd per share) | $ / shares | 87.23 |
Expired (in usd per share) | $ / shares | 0 |
Forfeited (in usd per share) | $ / shares | 106.12 |
Outstanding, ending balance (in usd per share) | $ / shares | $ 128.38 |
Performance Vested Restricted Stock Units | |
Restricted Stock and Performance Vested Restricted Stock Units, Shares | |
Outstanding, beginning balance (in shares) | shares | 412,642 |
Granted (in shares) | shares | 111,585 |
Performance-Based Leveraging (in shares) | shares | 27,775 |
Exercised/Vested (in shares) | shares | 0 |
Expired (in shares) | shares | (78,370) |
Forfeited (in shares) | shares | (3,819) |
Outstanding, ending balance (in shares) | shares | 469,813 |
Restricted Stock and Performance Vested Restricted Stock Units, Weighted Average Grant Date Fair Value | |
Outstanding, beginning balance (in usd per share) | $ / shares | $ 114.70 |
Granted (in usd per share) | $ / shares | 181.91 |
Performance-Based Leveraging (in usd per share) | $ / shares | 153.75 |
Exercised/Vested (in usd per share) | $ / shares | 0 |
Expired (in usd per share) | $ / shares | 81.15 |
Forfeited (in usd per share) | $ / shares | 125.04 |
Outstanding, ending balance (in usd per share) | $ / shares | $ 136.32 |
Share-Based Compensation and _5
Share-Based Compensation and Capital Stock - Weighted Average Assumptions Of Black-Scholes Option-Pricing Model (Details) - Stock options | 9 Months Ended |
Sep. 30, 2022 $ / shares | |
Share-Based Compensation and Capital Stock [Line Items] | |
Risk-free interest rate | 2.01% |
Expected volatility | 29.46% |
Expected life of stock option | 5 years 10 months 24 days |
Dividend yield | 0.66% |
Requisite service period | 4 years |
Contractual life | 10 years |
Weighted average fair value of options granted (in usd per share) | $ 42.66 |
Share-Based Compensation and _6
Share-Based Compensation and Capital Stock - Narrative (Details) $ in Millions | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2022 USD ($) shares | Sep. 30, 2021 USD ($) shares | Sep. 30, 2022 USD ($) award_type shares | Sep. 30, 2021 USD ($) shares | Sep. 14, 2022 shares | |
Share-Based Compensation and Capital Stock [Line Items] | |||||
Increase in number of shares authorized to be repurchased (in shares) | 5,000,000 | ||||
Number of shares authorized to be repurchased (in shares) | 6,700,000 | ||||
Stock repurchased during period (in shares) | 2,004,386 | 34,746 | 2,072,872 | 36,328 | |
Cost of shares repurchased | $ | $ 231.3 | $ 4 | $ 241.2 | $ 4.2 | |
Stock redeemed during period (in shares) | 614 | 5,300 | 35,462 | 52,955 | |
Stock redeemed during period | $ | $ 0.1 | $ 0.7 | $ 5.3 | $ 5.8 | |
Restricted stock awards | |||||
Share-Based Compensation and Capital Stock [Line Items] | |||||
Types of awards granted | award_type | 2 | ||||
Restricted stock awards | Minimum | |||||
Share-Based Compensation and Capital Stock [Line Items] | |||||
Performance period, duration | 9 months | ||||
Restricted stock awards | Maximum | |||||
Share-Based Compensation and Capital Stock [Line Items] | |||||
Performance period, duration | 60 months | ||||
Performance Vested Restricted Stock Units | |||||
Share-Based Compensation and Capital Stock [Line Items] | |||||
Types of awards granted | award_type | 3 | ||||
Performance Vested Restricted Stock Units | Minimum | |||||
Share-Based Compensation and Capital Stock [Line Items] | |||||
Performance period, duration | 9 months | ||||
Performance period, percent | 0% | ||||
Performance Vested Restricted Stock Units | Maximum | |||||
Share-Based Compensation and Capital Stock [Line Items] | |||||
Performance period, duration | 60 months | ||||
Performance period, percent | 300% |
Earnings Per Share - Computatio
Earnings Per Share - Computation Of Basic And Diluted Earnings Per Common Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 9 Months Ended | ||||||
Sep. 30, 2022 | Jun. 30, 2022 | Mar. 31, 2022 | Sep. 30, 2021 | Jun. 30, 2021 | Mar. 31, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Numerator: | ||||||||
Net income | $ 103,080 | $ 106,168 | $ 67,391 | $ 116,655 | $ 85,882 | $ 22,337 | $ 276,639 | $ 224,874 |
Income allocated to participating securities | (614) | (420) | (1,526) | (910) | ||||
Net income available to common shareholders | $ 102,466 | $ 116,235 | $ 275,113 | $ 223,964 | ||||
Denominator: | ||||||||
Weighted average shares of common stock outstanding – basic (in shares) | 54,847 | 55,427 | 55,233 | 55,360 | ||||
Basic earnings per share (in usd per share) | $ 1.87 | $ 2.10 | $ 4.98 | $ 4.05 | ||||
Numerator: | ||||||||
Net income | $ 103,080 | $ 106,168 | $ 67,391 | $ 116,655 | $ 85,882 | $ 22,337 | $ 276,639 | $ 224,874 |
Income allocated to participating securities | (614) | (420) | (1,526) | (910) | ||||
Net income available to common shareholders | $ 102,466 | $ 116,235 | $ 275,113 | $ 223,964 | ||||
Denominator: | ||||||||
Weighted average shares of common stock outstanding – basic (in shares) | 54,847 | 55,427 | 55,233 | 55,360 | ||||
Diluted effect of stock options and PVRSUs (in shares) | 395 | 478 | 520 | 429 | ||||
Weighted average shares of common stock outstanding – diluted (in shares) | 55,242 | 55,905 | 55,753 | 55,789 | ||||
Diluted earnings per share (in usd per share) | $ 1.85 | $ 2.08 | $ 4.93 | $ 4.01 |
Earnings Per Share - Antidiluti
Earnings Per Share - Antidilutive Securities Excluded from Computation of Earnings Per Share (Details) - shares shares in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Stock options | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Stock options (in shares) | 170 | 0 | 154 | 0 |
PVRSUs | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
PVRSUs (in shares) | 75 | 155 | 75 | 155 |
Reportable Segment Informatio_2
Reportable Segment Information - Narrative (Details) | Sep. 30, 2022 brand |
Segment Reporting [Abstract] | |
Number of brands | 23 |
Reportable Segment Informatio_3
Reportable Segment Information - Schedule Of Financial Information For Company's Franchising Segment (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Reportable Segment Information [Line Items] | ||||
Revenues | $ 414,266 | $ 323,369 | $ 1,039,967 | $ 784,660 |
Operating income (loss) | 145,018 | 159,106 | 401,764 | 322,128 |
Income (loss) before income taxes | 136,776 | 151,589 | 366,637 | 292,153 |
Corporate & Other | ||||
Reportable Segment Information [Line Items] | ||||
Revenues | 29,692 | 13,532 | 63,363 | 30,504 |
Operating income (loss) | (16,066) | (10,410) | (32,088) | (38,141) |
Income (loss) before income taxes | (25,386) | (20,749) | (68,494) | (66,121) |
Intersegment Eliminations | ||||
Reportable Segment Information [Line Items] | ||||
Revenues | (1,550) | (866) | (3,748) | (1,857) |
Operating income (loss) | 0 | 0 | 0 | 0 |
Income (loss) before income taxes | 0 | 0 | 0 | 0 |
Hotel Franchising | Operating Segments | ||||
Reportable Segment Information [Line Items] | ||||
Revenues | 386,124 | 310,703 | 980,352 | 756,013 |
Operating income (loss) | 161,084 | 169,516 | 433,852 | 360,269 |
Income (loss) before income taxes | $ 162,162 | $ 172,338 | $ 435,131 | $ 358,274 |
Commitments and Contingencies (
Commitments and Contingencies (Details) $ in Millions | Nov. 01, 2022 USD ($) | Sep. 30, 2022 USD ($) hotel | Aug. 11, 2022 USD ($) |
Commitments and Contingencies [Line Items] | |||
Limited payment guaranties | $ 5.7 | ||
Other commitment | $ 1.8 | ||
Radisson Hotels Americas | Affiliated Entity | |||
Commitments and Contingencies [Line Items] | |||
Number of hotels managed | hotel | 8 | ||
Maximum amount of guarantee | $ 46 | ||
Subsequent Event | Radisson Hotels Americas | Affiliated Entity | |||
Commitments and Contingencies [Line Items] | |||
Maximum amount of guarantee | $ 22 | ||
Forgivable notes receivable | |||
Commitments and Contingencies [Line Items] | |||
Other commitment | $ 302.5 | ||
Capital contributions to joint ventures | |||
Commitments and Contingencies [Line Items] | |||
Other commitment | $ 7.7 |
Transactions with Unconsolida_2
Transactions with Unconsolidated Affiliates (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | Dec. 31, 2021 | |
Member of Unconsolidated Joint Venture | |||||
Related Party Transaction [Line Items] | |||||
Royalty and marketing and reservation system fees | $ 8.9 | $ 8 | $ 19.5 | $ 15 | |
Receivables | 4.8 | 4.8 | $ 2.7 | ||
Joint Venture Partner | |||||
Related Party Transaction [Line Items] | |||||
Fees earned and payroll costs reimbursed from marketing services arrangement | 0.8 | $ 0.6 | 1.7 | $ 1.1 | |
Affiliated Entity | Radisson Hotels Americas | |||||
Related Party Transaction [Line Items] | |||||
Fees earned and payroll costs reimbursed from marketing services arrangement | $ 0.6 | $ 0.6 |
Assets Held for Sale - Narrativ
Assets Held for Sale - Narrative (Details) $ in Millions | 3 Months Ended | 9 Months Ended | |
Sep. 30, 2022 USD ($) | Jun. 30, 2022 USD ($) | Sep. 30, 2022 USD ($) asset | |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||
Number of separately owned hotel assets met held for sale | asset | 2 | ||
Building | |||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||
Reduction in carrying value | $ 2.2 | ||
Prepaid Expenses and Other Current Assets | Building | |||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||
Assets held for sale | 28.3 | $ 28.3 | |
Prepaid Expenses and Other Current Assets | Corporate & Other | Building | |||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||
Gain on sale of business and assets, net | $ 15.9 | $ 2.9 |
Acquisitions - Asset Acquisitio
Acquisitions - Asset Acquisition (Details) - USD ($) $ in Thousands | Apr. 14, 2022 | Sep. 30, 2022 | Mar. 31, 2022 | Dec. 31, 2021 |
Business Acquisition [Line Items] | ||||
Notes receivable, net of allowance | $ 106,873 | $ 120,904 | ||
2022 Asset Acquisition | ||||
Business Acquisition [Line Items] | ||||
Asset acquisition, consideration transferred | $ 20,400 | |||
Asset acquisition, consideration transferred, liabilities assumed | (800) | |||
2022 Asset Acquisition | Land | ||||
Business Acquisition [Line Items] | ||||
Property acquired | 3,300 | |||
2022 Asset Acquisition | Building and Building Improvements | ||||
Business Acquisition [Line Items] | ||||
Property acquired | 16,600 | |||
2022 Asset Acquisition | Furniture, fixtures and equipment | ||||
Business Acquisition [Line Items] | ||||
Property acquired | $ 1,300 | |||
Senior And Mezzanine Loan | Commercial Real Estate | ||||
Business Acquisition [Line Items] | ||||
Notes receivable, net of allowance | $ 20,400 |
Acquisitions - Narrative (Radis
Acquisitions - Narrative (Radisson Hotels Americas Acquisition) (Details) - Radisson Hotels Americas - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |
Aug. 11, 2022 | Sep. 30, 2022 | Sep. 30, 2022 | |
Business Acquisition [Line Items] | |||
Purchase price | $ 673,900 | ||
Base purchase price to acquire businesses | 675,200 | ||
Acquisition related costs | $ 24,900 | $ 29,000 | |
Restricted cash | 10,403 | ||
Revolving Credit Facility | Unsecured Credit Facility | Line of Credit | |||
Business Acquisition [Line Items] | |||
Proceeds from lines of credit | 175,000 | ||
Total capacity | $ 600,000 |
Acquisitions - Schedule of Reco
Acquisitions - Schedule of Recognized Identified Assets Acquired and Liabilities Assumed (Details) - USD ($) $ in Thousands | Sep. 30, 2022 | Aug. 11, 2022 | Dec. 31, 2021 |
Liabilities assumed | |||
Goodwill | $ 227,703 | $ 159,196 | |
Radisson Hotels Americas | |||
Assets acquired | |||
Cash and cash equivalents | $ 113,023 | ||
Restricted cash | 10,403 | ||
Accounts receivable | 32,972 | ||
Notes receivables - current | 1,709 | ||
Prepaid expenses and other current assets | 8,139 | ||
Property and equipment | 125,441 | ||
Operating lease right-of-use of assets | 42,315 | ||
Intangible assets | 447,400 | ||
Notes receivable - noncurrent | 2,592 | ||
Investment in affiliates | 471 | ||
Other assets | 2,129 | ||
Total assets acquired | 786,594 | ||
Liabilities assumed | |||
Accounts payable | 8,295 | ||
Accrued expenses and other current liabilities | 15,987 | ||
Deferred revenue - current | 5,745 | ||
Liability for guest loyalty program - current | 3,542 | ||
Long-term debt | 55,975 | ||
Long-term deferred revenue | 26,499 | ||
Deferred compensation and retirement plan obligations | 9,265 | ||
Operating lease liabilities | 42,705 | ||
Liability for guest loyalty program - noncurrent | 10,180 | ||
Other liabilities | 3,052 | ||
Total liabilities assumed | 181,245 | ||
Fair value of net assets acquired | 605,349 | ||
Goodwill | $ 68,507 | ||
Total purchase consideration | $ 673,856 |
Acquisitions - Schedule Of Prop
Acquisitions - Schedule Of Property Plant And Equipment Acquired (Details) - Radisson Hotels Americas $ in Thousands | Aug. 11, 2022 USD ($) |
Business Acquisition [Line Items] | |
Property and equipment | $ 125,441 |
Land | |
Business Acquisition [Line Items] | |
Property and equipment | 7,159 |
Construction in progress | |
Business Acquisition [Line Items] | |
Property and equipment | $ 3,190 |
Building and leasehold improvements | |
Business Acquisition [Line Items] | |
Estimated Useful Life | 24 years 4 months 24 days |
Property and equipment | $ 93,934 |
Site improvements | |
Business Acquisition [Line Items] | |
Estimated Useful Life | 23 years 1 month 6 days |
Property and equipment | $ 586 |
Furniture, fixtures and equipment | |
Business Acquisition [Line Items] | |
Estimated Useful Life | 3 years 10 months 24 days |
Property and equipment | $ 8,334 |
Computer equipment and software | |
Business Acquisition [Line Items] | |
Estimated Useful Life | 2 years |
Property and equipment | $ 12,238 |
Acquisitions - Schedule of Inde
Acquisitions - Schedule of Indefinite-Lived Intangible Assets (Details) $ in Thousands | Aug. 11, 2022 USD ($) |
Trade Names | |
Business Acquisition [Line Items] | |
Estimated Fair Value | $ 223,700 |
Radisson Hotels Americas | |
Business Acquisition [Line Items] | |
Estimated Fair Value | $ 447,400 |
Radisson Hotels Americas | Franchise Rights | |
Business Acquisition [Line Items] | |
Estimated Useful Life | 15 years 6 months |
Estimated Fair Value | $ 220,400 |
Radisson Hotels Americas | Management Agreements | |
Business Acquisition [Line Items] | |
Estimated Useful Life | 15 years 6 months |
Estimated Fair Value | $ 3,300 |
Acquisitions - Schedule of Pro
Acquisitions - Schedule of Pro Forma Information (Details) - Radisson Hotels Americas - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2022 | Sep. 30, 2021 | |
Business Acquisition [Line Items] | ||
Revenues | $ 1,189,792 | $ 928,669 |
Net income | $ 304,770 | $ 173,822 |
Acquisitions - Schedule of Busi
Acquisitions - Schedule of Business Acquisition Result Of Operation (Details) - Radisson Hotels Americas $ in Thousands | 2 Months Ended |
Sep. 30, 2022 USD ($) | |
Business Acquisition [Line Items] | |
Revenues | $ 40,203 |
Net income (loss) | $ (1,380) |
Acquisitions - Schedule of Good
Acquisitions - Schedule of Goodwill (Details) - USD ($) $ in Thousands | Sep. 30, 2022 | Dec. 31, 2021 |
Business Acquisition [Line Items] | ||
Goodwill, net carrying amount | $ 227,703 | $ 159,196 |
Radisson Hotels Americas | ||
Business Acquisition [Line Items] | ||
Goodwill | 166,774 | |
Accumulated impairment losses | (7,578) | |
Goodwill, net carrying amount | $ 68,507 |