Choice Reports First Quarter Net Income Grew 47%

Compared to the Same Period Last Year; Domestic Hotel Franchise Contracts Up 17% / Brand Operating D

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. October 14, 2008

SILVER SPRING, MD, April 25, 2006. Choice Hotels International, Inc., (NYSE: CHH) today reported the following highlights for the first quarter of 2006:

• Diluted earnings per share (EPS) increased 44% to $0.26, compared to $0.18 for first quarter 2005.

• Net income grew 47% from $12.0 million in first quarter 2005 to $17.7 million in the same period of this year.

• Earnings before interest, taxes, depreciation and amortization ("EBITDA") increased 32% to $32.4 million from $24.6 million in first quarter 2005.

• Operating income increased 35% to $30.1 million, compared to $22.3 million for the same period in 2005.

• Total revenues increased 20% to $109.4 million compared to the firstquarter of 2005.

• Domestic system-wide revenue per available room (RevPAR) increased 9.4% compared to the first quarter of 2005.

• Domestic unit growth increased 5.2% compared to the first quarter 2005 (excluding the acquisition of Suburban, domestic unit growth increased 3.6%).

• Year-to-date new domestic hotel franchise contracts were up 17% to 120, with new construction contracts increasing 41 percent to 48, as compared to 34 in first quarter 2005, including 10 contracts for the new Cambria Suites brand, as compared to 13 for the full year 2005.

• Franchising revenues were up 22% for first quarter.

• The domestic hotel pipeline of hotels under construction, awaiting conversion or approved for development increased more than 60% to 653 hotels, representing 51,157 rooms; an additional 69 hotels, representing 6,223 rooms, were in the worldwide pipeline at March 31, 2006.

"Choice's franchising business model continues to deliver strong revenue and earnings growth, as evidenced by our track record of outstanding results and total returns to shareholders, which have been in excess of 45% on an annualized basis over the past five years," said Charles A. Ledsinger, Jr., president and chief executive officer. "Choice has shown that it can generate solid, predictable growth in a wide variety of economic conditions and industry cycles, further underscoring the strength of our business model and the predictability of our business. As a result, we are confident that the combination of our sound operating strategies and the strength of the lodging and hospitality industry positions us well for continued top-line and bottom- line growth."

"We also are quite pleased with the significant increase in our new construction projects, particularly our new upscale Cambria Suites brand," continued Ledsinger. "Since we introduced the brand a little over a year ago, we have executed 23 contracts, including 10 in the first quarter of this year."

Outlook for 2006

The company's second quarter 2006 diluted EPS is expected to be $0.36 to $0.39. Full-year 2006 diluted EPS is expected to be $1.46 to $1.49. Earnings before interest, taxes, depreciation and amortization ("EBITDA") is expected to be $175 million to $179 million for full-year 2006. These estimates include the following assumptions.

• The company expects net domestic unit growth of approximately 4% in 2006;

• RevPAR is expected to increase 6% to 7.5% for second quarter 2006 and 5.5% to 7% for full-year 2006;

• The effective royalty rate is expected to increase 3 basis points for full-year 2006;

• All figures assume the existing share count, include stock-based compensation expense and assume an effective tax rate of 36.5% for full-year 2006.

Use of Free Cash Flow

The company has consistently used its free cash flow (cash flow from operations less capital expenditures) generated from its operations to return value to shareholders. This is primarily achieved through share repurchases and dividends.

For the quarter ended March 31, 2006, the company paid $8.4 million of cash dividends to shareholders. The annual dividend rate per common share is $0.52.

The company has remaining authorization to purchase up to 5.1 million shares under the share repurchase program. Repurchases will continue to be made in the open market and through privately negotiated transactions subject to market and other conditions. No minimum number of shares has been fixed. Since Choice announced its stock repurchase program on June 25, 1998, the company has repurchased 33.6 million shares of its common stock for a total cost of $711.9 million through April 25, 2006. Considering the effect of the two-for-one stock split in October 2005, the company has repurchased 66.6 million shares at an average price of $10.69 per share.

The company expects to continue to return value to its shareholders through a combination of share repurchases and dividends, subject to market and other conditions.