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Previous: FIRST AMERICAN STRATEGY FUNDS INC, N14AE24, 1997-08-08 |
Next: WELLS REAL ESTATE FUND X L P, 10-Q, 1997-08-08 |
<PAGE>
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
------------------
FORM 8-K
CURRENT REPORT PURSUANT TO
SECTION 13 OR 15(D) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of report (Date of earliest event reported): August 8, 1997
--------------
Choice Hotels International, Inc.
--------------------------------------------------
(Exact Name of Registrant as Specified in Charter)
Delaware 52-1985619
- ---------------------------- --------------------
(State or Other Jurisdiction (IRS Employer
of Incorporation) Identification No.)
10750 Columbia Pike
Silver Spring, Maryland 20901
----------------------------------------
(Address of Principal Executive Offices)
(301) 979-5000
-------------------------------------------------------
(Registrant's telephone number, including area code)
<PAGE>
ITEM 5. Other Events
------------
Choice Hotels International, Inc. ("Choice" and, together with its
subsidiaries, the "Company") deems the information attached hereto as Exhibit
99.1, and incorporated herein by reference, to be of importance to its security
holders, as it provides supplemental information relating to the
reclassification of revenues and operating expenses of the Company for the
fiscal years ended May 31, 1997 and 1996 and for the quarterly periods
comprising such fiscal years. This reclassification does not require any
amendments to the Company's reports filed under the Securities Exchange Act of
1934, as amended.
ITEM 7. Financial Statements, Pro Forma Financial Information and Exhibits
- ------- ------------------------------------------------------------------
(c) Exhibits
--------
99.1 Choice Hotels International, Inc. Comparative Consolidated
Statements of Income.
2
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
Choice Hotels International, Inc.
By: /s/ James A. MacCutcheon
-------------------------
James A. MacCutcheon
Executive Vice President,
Chief Financial Officer
and Treasurer
Date: August 8, 1997
3
<PAGE>
<TABLE>
<CAPTION>
Choice Hotels International, Inc.
Comparative Consolidated Statements of Income
Three Months Ended Three Months Ended
August 31, August 31, November 30, November 30,
(In thousands) 1996 1995 1996 1995
-------- -------- -------- ---------
<S> <C> <C> <C> <C>
Revenues
Royalties, initial fees and other $33,774 $29,738 $32,597 $28,900
Product sales 7,800 4,500 4,652 5,766
Marketing and reservations 27,813 26,294 26,905 24,897
Hotel operations 49,652 39,093 44,950 36,591
-------- -------- -------- ---------
Total revenues 119,039 99,625 109,104 96,154
-------- -------- -------- ---------
Operating Expenses
Franchise marketing and reservations 26,845 24,348 25,268 23,877
Hotel operations 32,359 27,253 31,387 27,501
Franchise selling, general and administrative 12,901 12,534 14,830 11,698
Hotel selling, general and administrative 792 679 1,354 796
Product services cost of sales 7,439 4,284 4,362 5,620
Depreciation and amortization 6,940 6,054 7,462 6,688
Provision for asset impairment and restructuring - - - -
-------- -------- -------- ---------
Total operating expenses 87,276 75,152 84,663 76,180
-------- -------- -------- ---------
Income before expenses and income taxes 31,763 24,473 24,441 19,974
-------- -------- -------- ---------
Other Expenses
Interest expense, net 5,866 5,900 6,326 6,023
Minority interest - - - -
-------- -------- -------- ---------
Total other expenses 5,866 5,900 6,326 6,023
-------- -------- -------- ---------
Income before income taxes 25,897 18,573 18,115 13,951
Income taxes 10,500 7,658 7,500 5,821
-------- -------- -------- ---------
Net income before extraordinary item 15,397 10,915 10,615 8,130
-------- -------- -------- ---------
Extraordinary item - loss from early extinguishment
of debt (net of $747 tax benefit) - - - -
-------- -------- -------- ---------
Net income $15,397 $10,915 $10,615 $ 8,130
======== ======== ======== =========
Pro forma earnings per share before extraordinary item(a) $0.24 $0.17 $0.17 $0.13
Pro forma extraordinary item per share - - - -
-------- -------- -------- ---------
Pro forma earnings per share(a) $0.24 $0.17 $0.17 $0.13
======== ======== ======== =========
Pro forma weighted average shares outstanding 63,000 62,628 63,050 62,587
======== ======== ======== =========
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
Choice Hotels International, Inc.
Comparative Consolidated Statements of Income
Three Months Ended Three Months Ended Twelve Months Ended
February 28, February 29, May 31, May 31, May 31, May 31,
(In thousands) 1997 1996 1997 1996 1997 1996
-------- -------- -------- -------- --------- --------
<S> <C> <C> <C> <C> <C> <C>
Revenues
Royalties, initial fees and other $ 24,709 $22,609 $30,777 $ 25,684 $121,857 $106,931
Product sales 5,099 4,003 5,247 7,301 22,798 21,570
Marketing and reservations 20,837 20,386 23,966 23,556 99,521 95,133
Hotel operations 39,704 33,551 51,447 45,390 185,753 154,625
-------- -------- -------- -------- --------- --------
Total revenues 90,349 80,549 111,437 101,931 429,929 378,259
-------- -------- -------- -------- --------- --------
Operating Expenses
Franchise marketing and reservations 22,167 19,916 22,445 24,305 96,725 92,446
Hotel operations 30,041 27,699 33,812 34,028 127,599 116,481
Franchise selling, general and administrative 11,550 12,714 11,821 8,250 51,102 45,196
Hotel selling, general and administrative 953 682 931 190 4,030 2,347
Product services cost of sales 5,536 3,824 5,429 6,981 22,766 20,709
Depreciation and amortization 7,640 6,418 7,755 6,902 29,797 26,062
Provision for asset impairment and restructuring - - - 33,335 - 33,335
-------- -------- -------- -------- --------- --------
Total operating expenses 77,887 71,253 82,193 113,991 332,019 336,576
-------- -------- -------- -------- --------- --------
Income before expenses and income taxes 12,462 9,296 29,244 (12,060) 97,910 41,683
-------- -------- -------- -------- --------- --------
Other Expenses
Interest expense, net 6,414 6,418 7,080 5,952 25,686 24,293
Minority interest - - - 1,532 - 1,532
-------- -------- -------- -------- --------- --------
Total other expenses 6,414 6,418 7,080 7,484 25,686 25,825
-------- -------- -------- -------- --------- --------
Income before income taxes 6,048 2,878 22,164 (19,544) 72,224 15,858
Income taxes 2,600 1,487 9,600 (7,566) 30,200 7,400
-------- -------- -------- -------- --------- --------
Net income before extraordinary item 3,448 1,391 12,564 (11,978) 42,024 8,458
-------- -------- -------- -------- --------- --------
Extraordinary item - loss from early extinguishment
of debt (net of $747 tax benefit) - - 1,144 - 1,144 -
-------- -------- -------- -------- --------- --------
Net income $3,448 $ 1,391 $11,420 $(11,978) $ 40,880 $ 8,458
======== ======== ======== ======== ========= ========
Pro forma earnings per share before extraordinary item(a) $0.05 $0.02 $0.20 ($0.19) $0.67 $0.14
Pro forma extraordinary item per share - - (0.02) - (0.02) -
-------- -------- -------- -------- --------- --------
Pro forma earnings per share(a) $0.05 $0.02 $0.19 ($0.19) $0.65 $0.14
======== ======== ======== ======== ========= ========
Pro forma weighted average shares outstanding 63,339 62,644 61,422 62,628 62,680 62,628
======== ======== ======== ======== ========= ========
</TABLE>
(a) The sum of these amounts does not equal the annual amount because of
rounding.
Note: earnings per share before extraordinary item, extraordinary item per
share, earnings per share and weighted average shares outstanding are
presented on a pro forma basis because the Company was a subsidiary of
Manor Care, Inc. until November 1, 1996.
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