This was a year of firsts for Choice Hotels International: the first year as an independent company and the first year under independent management following the spinoff from Manor Care Inc.

The Company introduced the most important technological initiative in its history: Profit Manager by Choice Hotels, a computerized system created to help franchisees maximize profitability and compete more effectively by managing their rooms inventory, rates and reservations more efficiently.

Choice opened the first Mainstay Suites hotel, the industry's first franchised mid-market, extended-stay lodging product featuring residential amenities designed to serve professionals on extended assignments and innovative technological systems including an automated front desk check-in system.

Upholding its reputation as a technology innovator and leader, Choice introduced the lodging industry's first Internet site devoted to travel agents, securing its longstanding relationship with this critical source of third-party bookings.

Choice became the first lodging franchisor in the nation to launch a training and certification program for all line-level hotel employees designed to improve guest satisfaction, increase productivity and, in return, generate higher profits for franchisees.

Choice welcomed more than 2,000 franchisee partners to the first Management Development Conferences, two large educational meetings dedicated to helping hotel owners improve their operations and profitability.

Finally, this is the first Choice Hotels International annual report published for you, our stockholders.

  A Year of Firsts     Financial Highlights     Letter to Our Stockholders     Focusing on the Franchisees     Optimizing the Brand Portfolio     Increasing Market Penetration     Improving Margins     Growing Overseas Operations     Leveraging the Spinoff of Franchise Operations