Choice Hotels Reports Full Year 2011

Full Year Results

• Adjusted diluted earnings per share ("EPS") for full year 2011 were $1.92 compared to $1.82 for full year 2010. Diluted EPS were $1.85 for 2011 compared to $1.80 for 2010. Adjusted diluted EPS for full year 2011 and 2010 exclude certain special items, as described below, totaling $0.07 and $0.02, respectively.

• Excluding special items, adjusted earnings before interest, taxes, depreciation and amortization ("EBITDA") increased 8% to $184.3 million for the year ended December 31, 2011, compared to $170.8 million for the year ended December 31, 2010. Operating income increased 7% from $160.8 million for the year ended December 31, 2010 to $171.9 million for same period of 2011.

• Franchising revenues increased 9% from $262.8 million for the year ended December 31, 2010 to $285.4 million for the same period of 2011. Total revenues increased 7% to $638.8 million for the year ended December 31, 2011 compared to the same period of 2010.

• The effective income tax rate for the year ended December 31, 2011 was 30.1% compared to 32.1% for the same period of the prior year. Excluding discrete items, totaling $5.1 million and $3.2 million recorded during the years ended December 31, 2011 and 2010, the company’s effective income tax rate was approximately 33.4% and 34.2%, respectively.

• Worldwide unit growth increased 0.6 percent from December 31, 2010 comprised of domestic and international unit growth of 0.2 percent and 2.4 percent, respectively.

• Domestic system-wide revenue per available room ("RevPAR") increased 6.2% for full year 2011 compared to the same period of 2010 as occupancy and average daily rates increased 220 basis points and 1.9 percent, respectively.

• The effective royalty rate increased 3 basis points to 4.32% for the year ended December 31, 2011 compared to 4.29% for the same period of the prior year.

• The company executed 332 new domestic hotel franchise contracts for the year ended December 31, 2011 compared to 357 new domestic hotel franchise contracts in the prior year.

• The number of worldwide hotels under construction, awaiting conversion or approved for development at December 31, 2011 was 490 hotels representing 39,675 rooms;

• During the year ended December 31, 2011, the company purchased approximately 1.6 million shares of its common stock at an average price of $31.59 for a total cost of $51.0 million under the share repurchase program.

Fourth Quarter Results

• Adjusted EPS for fourth quarter 2011 increased 10% to $0.46 compared to $0.42 for the same period of the prior year. Diluted EPS were $0.42 for the fourth quarter of 2011 compared to $0.40 for the same period of 2010. Adjusted diluted EPS for fourth quarter 2011 and 2010 exclude certain special items, as described below, totaling $0.04 and $0.02, respectively.

• Excluding special items, adjusted EBITDA were $44.3 million for the three months ended December 31, 2011, compared to $41.5 million for the same period of 2010. Operating income for the three months ended December 31, 2011 and 2010 was $38.7 million and $38.4 million, respectively.

• Franchising revenues increased 10% from $66.9 million for the three months ended December 31, 2010 to $73.9 million for the same period of 2011. Total revenues for the three months ended December 31, 2011 increased 7% compared to the same period of 2010.

• Domestic system-wide RevPAR increased 7.8% for the fourth quarter of 2011 compared to the same period of 2010 as a result of occupancy rates increasing 260 basis points and a 2.7% increase in average daily rates.

• The company executed 128 new domestic hotel franchise contracts for the three months ended December 31, 2011 compared to 161 contracts executed in the same period of the prior year.

"We are pleased with the continued strong gains we achieved in domestic RevPAR during the fourth quarter and the growth of our global franchise system,"

said Stephen P. Joyce, president and chief executive officer.

Stephen P. Joyce

President & CEO Choice Hotels

"While the near term franchise sales environment remains challenging, we believe that our well-known diversified brands will continue to resonate with developers and hotel owners due to our focus on owners’ property-level profitability and return on investment. We remain focused on prudently managing our brands, gaining operating efficiencies and returning value to our shareholders."