In the third quarter of 2020, Choice Hotels continued to provide a broad range of support to its franchisees, guests, and communities while improving its overall financial and liquidity position. Highlights of third quarter and year to date 2020 results include:

• Domestic systemwide revenue per available room (RevPAR) outperformed the total industry by nearly 20 percentage points, declining 28.8% for third quarter 2020 compared to the same period of the prior year, and exceeded the chain scale segments in which the company competes, as reported by STR.

• Fourth quarter domestic RevPAR through October 24, 2020 has continued the pattern of sequential quarterly improvement, and October 2020 RevPAR is expected to decline by approximately 25% from the same period of 2019 (see Exhibit 7 for weekly RevPAR trends).

• The company awarded 232 new domestic franchise agreements year to date through September 30, 2020, a 38% decrease compared to the same period of the prior year. Nearly 70% of the agreements awarded year to date through September 30, 2020 were for conversion hotels.

• Net income was $14.5 million for the third quarter, representing diluted earnings per share of $0.26.

• Third quarter adjusted net income, excluding certain items described in Exhibit 6, decreased 52% to $36.8 million from third quarter 2019.

• Adjusted diluted earnings per share for the third quarter were $0.66, a 52% decrease from third quarter 2019.

• Adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) for the third quarter were $74.9 million, a 34% decrease from third quarter 2019.

• The company reported cash flow from operations of over $68 million in the third quarter 2020.

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