RLJ RLJ Lodging Trust

Q3 RevPAR increased 2.0% compared to 2023

Redeployed disposition proceeds to repurchase $20.7 million of common shares

Entered into a new $500.0 million term loan

RLJ Lodging Trust (the “Company”) (NYSE: RLJ) today reported results for the three and nine months ended September 30, 2024.

Third Quarter Highlights

• Portfolio Comparable RevPAR of $145.23; an increase of 2.0% from last year
• Comparable Hotel Revenue of $344.7 million; an increase of 3.0% from last year
• Net Income of $20.6 million
• Comparable Hotel EBITDA of $100.7 million, an increase of 2.6% from last year
• Adjusted EBITDA of $91.9 million; an increase of 3.6% from last year
• Adjusted FFO per diluted common share and unit of $0.40
• Repurchased 1.6 million shares during the third quarter for approximately $14.8 million at an average price of $9.21
• Entered into a new $500.0 million term loan, using the proceeds to refinance a $400.0 million term loan due in 2025 and repay $100.0 million of outstanding borrowings on our revolver
• Increased quarterly common share dividend by 50%

“We are pleased with our third quarter results which were ahead of our expectations. We achieved RevPAR growth that was two times the industry and demonstrated the resiliency of our urban centric portfolio,” commented Leslie D. Hale, President and Chief Executive Officer. “In addition to achieving solid operating results, we executed on multiple key initiatives during the quarter including addressing all of our near-term maturities, completing two valuable conversions, accretively recycling non-core disposition proceeds to repurchase stock, raising our quarterly dividend by 50%, and reaffirming our outlook. All of these demonstrate our commitment to unlocking value while enhancing shareholder returns.”

The prefix “comparable” as defined by the Company, denotes operating results which include results for periods prior to its ownership and excludes sold hotels. Explanations of EBITDA, EBITDAre, Adjusted EBITDA, Hotel EBITDA, Hotel EBITDA Margin, FFO, and Adjusted FFO, as well as reconciliations of those measures to net income or loss, if applicable, are included within this release.

 

Financial and Operating Highlights

($ in thousands, except ADR, RevPAR, Change, and per share amounts)

(unaudited)

 

 

For the three months ended September 30,

For the nine months ended September 30,

 

2024

2023

Change

2024

2023

Change

Operational Overview: (1)

 

 

 

 

 

 

Comparable ADR

$193.39

$192.24

0.6%

$199.59

$198.88

0.4%

Comparable Occupancy

75.1%

74.1%

1.4%

73.7%

72.6%

1.5%

Comparable RevPAR

$145.23

$142.43

2.0%

$147.13

$144.41

1.9%

 

 

 

 

 

 

 

Financial Overview:

 

 

 

 

 

 

Total Revenue

$345,744

$334,406

3.4%

$1,039,451

$1,005,869

3.3%

Comparable Hotel Revenue

$344,727

$334,792

3.0%

$1,039,353

$1,007,433

3.2%

 

 

 

 

 

 

 

Net Income

$20,643

$16,343

26.3%

$62,680

$68,577

(8.6)%

 

 

 

 

 

 

 

Comparable Hotel EBITDA

$100,687

$98,156

2.6%

$307,638

$312,265

(1.5)%

Comparable Hotel EBITDA Margin

29.2%

29.3%

(11) bps

29.6%

31.0%

(140) bps

Adjusted EBITDA

$91,927

$88,767

3.6%

$280,494

$285,281

(1.7)%

 

 

 

 

 

 

 

Adjusted FFO

$61,155

$63,092

(3.1)%

$191,634

$207,009

(7.4)%

Adjusted FFO Per Diluted Common Share and Unit

$0.40

$0.40

(1.9)%

$1.24

$1.31

5.4%

Note:

(1)

Comparable statistics reflect the Company's 95 hotel portfolio owned as of September 30, 2024.

Disposition

During the third quarter of 2024, the Company sold one non-core hotel in Denver, Colorado for $12.7 million and recorded a gain-on-sale of $4.8 million.

Share Repurchases

During the third quarter, the Company repurchased 1.6 million common shares for approximately $14.8 million at an average price of $9.21. Year-to-date, the Company has repurchased 2.2 million common shares for approximately $20.7 million at an average price of $9.28 recycling proceeds from the sale of non-core assets this year. As of November 6, 2024, the Company's 2024 share repurchase program has a remaining capacity of $229.3 million.

Balance Sheet

As of September 30, 2024, the Company had approximately $885.4 million of total liquidity, comprised of approximately $385.4 million of unrestricted cash and $500.0 million available under its revolving credit facility (the "Revolver"), and $2.2 billion of debt outstanding.

In September 2024, the Company entered into a new $500.0 million unsecured term loan maturing in September 2027, with two one-year extension options. The proceeds from the new loan were used to repay the existing $400.0 million term loan due to mature in May 2025 and $100.0 million of the outstanding borrowings under the Revolver. During the third quarter, the Company also executed several interest rate swaps below current prevailing rates.

Dividends

The Company’s Board of Trustees had previously declared a third quarter cash dividend of $0.15 per common share of beneficial interest of the Company, representing a 50% increase from the prior quarter. The dividend was paid on October 15, 2024 to shareholders of record as of September 30, 2024.

The Company's Board of Trustees declared a third quarter cash dividend of $0.4875 on the Company’s Series A Preferred Shares. The dividend was paid on October 31, 2024 to shareholders of record as of September 30, 2024.

Outlook Update

The Company is reaffirming its prior full-year outlook for all assets owned as of November 6, 2024.

 

FY 2024 (1)

Comparable RevPAR Growth

1.0% to 2.5%

Comparable Hotel EBITDA

$382.5M to $402.5M

Adjusted EBITDA

$346.5M to $366.5M

Adjusted FFO per diluted share

$1.45 to $1.58

Note:

(1)

Prior FY 2024 Hotel EBITDA outlook incorporated $1.0 million from one hotel sold during the third quarter of 2024.

Additionally, the Company's full year 2024 outlook includes:

• Net interest expense of $92.0 million to $94.0 million
• Capital expenditures related to renovations in the range of $100.0 million to $120.0 million
• Diluted weighted average common shares and units of 154.5 million

Earnings Call

The Company will conduct its quarterly analyst and investor conference call on November 7, 2024 at 12:00 p.m. (Eastern Time). The conference call can be accessed by dialing (877) 407-3982 or (201) 493-6780 for international participants and requesting RLJ Lodging Trust’s third quarter earnings conference call. Additionally, a live webcast of the conference call will be available through the Company’s website at http://www.rljlodgingtrust.com. A replay of the conference call webcast will be archived and available through the Investor Relations section of the Company’s website for two weeks.

Supplemental Information

Please refer to the presentation of supplemental information for additional detail and comparable operating statistics, which will be available through the Investor Relations section of the Company's website.

About Us

RLJ Lodging Trust ("RLJ") is a self-advised, publicly traded real estate investment trust that owns 95 premium-branded, rooms-oriented, high-margin, urban-centric hotels located within the heart of demand locations. Our hotels are geographically diverse and concentrated in major urban markets that provide multiple demand generators from business, leisure, and other travelers.

Forward-Looking Statements

This information contains certain statements, other than purely historical information, including estimates, projections, statements relating to the Company’s business plans, objectives and expected operating results, and the assumptions upon which those statements are based, that are “forward looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. These forward-looking statements generally are identified by the use of the words “believe,” “project,” “expect,” “anticipate,” “estimate,” “plan,” “may,” “will,” “will continue,” “intend,” “should,” “may,” or similar expressions. Although the Company believes that the expectations reflected in such forward-looking statements are based upon reasonable assumptions, beliefs and expectations, such forward-looking statements are not predictions of future events or guarantees of future performance and our actual results could differ materially from those set forth in the forward-looking statements. Except as required by law, the Company undertakes no obligation to update or revise publicly any forward-looking statements, whether as a result of new information, future events or otherwise. The Company cautions investors not to place undue reliance on these forward-looking statements and urges investors to carefully review the disclosures the Company makes concerning risks and uncertainties in the sections entitled “Risk Factors,” “Forward-Looking Statements,” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in the Company’s Annual Report on Form 10-K for the year ended December 31, 2023 and the Company's Quarterly Report on Form 10-Q for the quarter ended September 30, 2024, which will be filed on November 7, 2024, as well as risks, uncertainties and other factors discussed in other documents filed by the Company with the Securities and Exchange Commission.

For additional information or to receive press releases via email, please visit our website: https://www.rljlodgingtrust.com

RLJ Lodging Trust Non-GAAP and Accounting Commentary

Non-Generally Accepted Accounting Principles (“Non-GAAP”) Financial Measures

The Company considers the following non-GAAP financial measures useful to investors as key supplemental measures of its performance: (1) FFO, (2) Adjusted FFO, (3) EBITDA, (4) EBITDAre, (5) Adjusted EBITDA, (6) Hotel EBITDA, and (7) Hotel EBITDA Margin. These Non-GAAP financial measures should be considered along with, but not as alternatives to, net income or loss as a measure of its operating performance. FFO, Adjusted FFO, EBITDA, EBITDAre, Adjusted EBITDA, Hotel EBITDA, and Hotel EBITDA Margin, as calculated by the Company, may not be comparable to other companies that do not define such terms exactly as the Company defines such terms.

Funds From Operations (“FFO”)

The Company calculates Funds from Operations (“FFO”) in accordance with standards established by the National Association of Real Estate Investment Trusts, or NAREIT, which defines FFO as net income or loss (calculated in accordance with GAAP), excluding gains or losses from sales of real estate, impairment, the cumulative effect of changes in accounting principles, plus depreciation and amortization, and adjustments for unconsolidated partnerships and joint ventures. Historical cost accounting for real estate assets implicitly assumes that the value of real estate assets diminishes predictably over time. Since real estate values have instead historically risen or fallen with market conditions, most real estate industry investors consider FFO to be helpful in evaluating a real estate company’s operations. The Company believes that the presentation of FFO provides useful information to investors regarding the Company’s operating performance and can facilitate comparisons of operating performance between periods and between real estate investment trusts (“REITs”), even though FFO does not represent an amount that accrues directly to common shareholders.

The Company’s calculation of FFO may not be comparable to measures calculated by other companies who do not use the NAREIT definition of FFO or do not calculate FFO per diluted share in accordance with NAREIT guidance. Additionally, FFO may not be helpful when comparing the Company to non-REITs. The Company presents FFO attributable to common shareholders, which includes unitholders of limited partnership interest (“OP units”) in RLJ Lodging Trust, L.P., the Company’s operating partnership, because the OP units may be redeemed for common shares of the Company. The Company believes it is meaningful for the investor to understand FFO attributable to all common shares and OP units.

EBITDA and EBITDAre

Earnings Before Interest, Taxes, Depreciation, and Amortization (“EBITDA”) is defined as net income or loss excluding: (1) interest expense; (2) income tax expense; and (3) depreciation and amortization expense. The Company considers EBITDA useful to an investor in evaluating and facilitating comparisons of its operating performance between periods and between REITs by removing the impact of its capital structure (primarily interest expense) and asset base (primarily depreciation and amortization expense) from its operating results. In addition, EBITDA is used as one measure in determining the value of hotel acquisitions and dispositions.

In addition to EBITDA, the Company presents EBITDAre in accordance with NAREIT guidelines, which defines EBITDAre as net income or loss (calculated in accordance with GAAP) excluding interest expense, income tax expense, depreciation and amortization expense, gains or losses from sales of real estate, impairment, and adjustments for unconsolidated joint ventures. The Company believes that the presentation of EBITDAre provides useful information to investors regarding the Company's operating performance and can facilitate comparisons of operating performance between periods and between REITs.

Adjustments to FFO and EBITDA

The Company adjusts FFO, EBITDA, and EBITDAre for certain items that the Company considers outside the normal course of operations. The Company believes that Adjusted FFO, Adjusted EBITDA, and Adjusted EBITDAre provide useful supplemental information to investors regarding its ongoing operating performance that, when considered with net income or loss, FFO, EBITDA, and EBITDAre, are beneficial to an investor’s understanding of the Company's operating performance. The Company adjusts FFO, EBITDA, and EBITDAre for the following items:

• Transaction Costs: The Company excludes transaction costs expensed during the period
• Pre-Opening Costs: The Company excludes certain costs related to pre-opening of hotels
• Non-Cash Expenses: The Company excludes the effect of certain non-cash items such as the amortization of share-based compensation, non-cash income tax expense or benefit, and non-cash interest expense related to discontinued interest rate hedges
• Other Non-Operational Expenses: The Company excludes the effect of certain non-operational expenses representing income and expenses outside the normal course of operations

Hotel EBITDA and Hotel EBITDA Margin

With respect to Consolidated Hotel EBITDA, the Company believes that excluding the effect of corporate-level expenses and certain non-cash items provides a more complete understanding of the operating results over which individual hotels and operators have direct control. The Company believes property-level results provide investors with supplemental information about the ongoing operational performance of the Company’s hotels and the effectiveness of third-party management companies.

Comparable Hotel EBITDA and Comparable Hotel EBITDA margin include prior ownership information provided by the sellers of the hotels for periods prior to our acquisition of the hotels and excludes results from sold hotels as applicable.

Comparable adjustments: Acquired hotel

For the three and nine months ended September 30, 2024 and 2023, Comparable adjustments included the following acquired hotel:

• Hotel Teatro acquired in June 2024

Comparable adjustments: Sold hotels

For the three and nine months ended September 30, 2024 and 2023, Comparable adjustments included the following sold hotels:

• Residence Inn Merrillville sold in May 2024
• Fairfield Inn & Suites Denver Cherry Creek sold in September 2024

 

RLJ Lodging Trust

Consolidated Balance Sheets

(Amounts in thousands, except share and per share data)

(unaudited)

 

 

September 30, 2024

 

December 31, 2023

Assets

 

 

 

Investment in hotel properties, net

$

4,257,199

 

 

$

4,136,216

 

Investment in unconsolidated joint ventures

 

7,237

 

 

 

7,398

 

Cash and cash equivalents

 

385,384

 

 

 

516,675

 

Restricted cash reserves

 

38,958

 

 

 

38,652

 

Hotel and other receivables, net of allowance of $294 and $265, respectively

 

26,437

 

 

 

26,163

 

Lease right-of-use assets

 

129,526

 

 

 

136,140

 

Prepaid expense and other assets

 

43,250

 

 

 

58,051

 

Total assets

$

4,887,991

 

 

$

4,919,295

 

Liabilities and Equity

 

 

 

Debt, net

$

2,218,826

 

 

$

2,220,778

 

Accounts payable and other liabilities

 

154,933

 

 

 

147,819

 

Advance deposits and deferred revenue

 

36,643

 

 

 

32,281

 

Lease liabilities

 

119,508

 

 

 

122,588

 

Accrued interest

 

12,114

 

 

 

22,539

 

Distributions payable

 

30,431

 

 

 

22,500

 

Total liabilities

 

2,572,455

 

 

 

2,568,505

 

Equity

 

 

 

Shareholders’ equity:

 

 

 

Preferred shares of beneficial interest, $0.01 par value, 50,000,000 shares authorized

 

 

 

Series A Cumulative Convertible Preferred Shares, $0.01 par value, 12,950,000 shares authorized; 12,879,475 shares issued and outstanding, liquidation value of $328,266, at September 30, 2024 and December 31, 2023

 

366,936

 

 

 

366,936

 

Common shares of beneficial interest, $0.01 par value, 450,000,000 shares authorized; 153,628,657 and 155,297,829 shares issued and outstanding at September 30, 2024 and December 31, 2023, respectively

 

1,536

 

 

 

1,553

 

Additional paid-in capital

 

2,990,553

 

 

 

3,000,894

 

Distributions in excess of net earnings

 

(1,066,035

)

 

 

(1,055,183

)

Accumulated other comprehensive income

 

8,835

 

 

 

22,662

 

Total shareholders’ equity

 

2,301,825

 

 

 

2,336,862

 

Noncontrolling interests:

 

 

 

Noncontrolling interest in the Operating Partnership

 

6,258

 

 

 

6,294

 

Noncontrolling interest in consolidated joint ventures

 

7,453

 

 

 

7,634

 

Total noncontrolling interest

 

13,711

 

 

 

13,928

 

Total equity

 

2,315,536

 

 

 

2,350,790

 

Total liabilities and equity

$

4,887,991

 

 

$

4,919,295

 

Note: The corresponding notes to the consolidated financial statements can be found in the Company’s Quarterly Report on Form 10-Q.

 

RLJ Lodging Trust

Consolidated Statements of Operations

(Amounts in thousands, except share and per share data)

(unaudited)

 

 

For the three months ended September 30,

 

For the nine months ended September 30,

 

 

2024

 

 

 

2023

 

 

 

2024

 

 

 

2023

 

Revenues

 

 

 

 

 

 

 

Operating revenues

 

 

 

 

 

 

 

Room revenue

$

283,614

 

 

$

277,088

 

 

$

853,896

 

 

$

833,416

 

Food and beverage revenue

 

36,983

 

 

 

34,181

 

 

 

113,515

 

 

 

105,601

 

Other revenue

 

25,147

 

 

 

23,137

 

 

 

72,040

 

 

 

66,852

 

Total revenues

 

345,744

 

 

 

334,406

 

 

 

1,039,451

 

 

 

1,005,869

 

Expenses

 

 

 

 

 

 

 

Operating expenses

 

 

 

 

 

 

 

Room expense

 

74,558

 

 

 

71,278

 

 

 

217,885

 

 

 

207,662

 

Food and beverage expense

 

29,348

 

 

 

27,430

 

 

 

88,279

 

 

 

81,604

 

Management and franchise fee expense

 

27,339

 

 

 

27,095

 

 

 

82,783

 

 

 

82,554

 

Other operating expenses

 

92,350

 

 

 

87,736

 

 

 

272,951

 

 

 

254,567

 

Total property operating expenses

 

223,595

 

 

 

213,539

 

 

 

661,898

 

 

 

626,387

 

Depreciation and amortization

 

44,892

 

 

 

44,727

 

 

 

134,045

 

 

 

134,648

 

Property tax, insurance and other

 

24,156

 

 

 

26,936

 

 

 

80,743

 

 

 

76,268

 

General and administrative

 

12,781

 

 

 

14,747

 

 

 

41,826

 

 

 

43,030

 

Transaction costs

 

209

 

 

 

2

 

 

 

299

 

 

 

26

 

Total operating expenses

 

305,633

 

 

 

299,951

 

 

 

918,811

 

 

 

880,359

 

Other income, net

 

791

 

 

 

1,921

 

 

 

4,669

 

 

 

3,506

 

Interest income

 

4,286

 

 

 

5,302

 

 

 

13,191

 

 

 

13,977

 

Interest expense

 

(28,643

)

 

 

(24,833

)

 

 

(83,150

)

 

 

(73,506

)

Gain (loss) on sale of hotel properties, net

 

4,755

 

 

 

16

 

 

 

8,301

 

 

 

(28

)

Loss on extinguishment of indebtedness, net

 

(129

)

 

 

—

 

 

 

(129

)

 

 

(169

)

Income before equity in (loss) income from unconsolidated joint ventures

 

21,171

 

 

 

16,861

 

 

 

63,522

 

 

 

69,290

 

Equity in (loss) income from unconsolidated joint ventures

 

(149

)

 

 

(186

)

 

 

239

 

 

 

315

 

Income before income tax expense

 

21,022

 

 

 

16,675

 

 

 

63,761

 

 

 

69,605

 

Income tax expense

 

(379

)

 

 

(332

)

 

 

(1,081

)

 

 

(1,028

)

Net income

 

20,643

 

 

 

16,343

 

 

 

62,680

 

 

 

68,577

 

Net (income) loss attributable to noncontrolling interests:

 

 

 

 

 

 

 

Noncontrolling interest in the Operating Partnership

 

(49

)

 

 

(50

)

 

 

(216

)

 

 

(238

)

Noncontrolling interest in consolidated joint ventures

 

8

 

 

 

137

 

 

 

181

 

 

 

131

 

Net income attributable to RLJ

 

20,602

 

 

 

16,430

 

 

 

62,645

 

 

 

68,470

 

Preferred dividends

 

(6,279

)

 

 

(6,279

)

 

 

(18,836

)

 

 

(18,836

)

Net income attributable to common shareholders

$

14,323

 

 

$

10,151

 

 

$

43,809

 

 

$

49,634

 

Basic per common share data:

 

 

 

 

 

 

 

Net income per share attributable to common shareholders - basic

$

0.09

 

 

$

0.06

 

 

$

0.28

 

 

$

0.31

 

Weighted-average number of common shares

 

153,070,639

 

 

 

154,563,284

 

 

 

153,226,734

 

 

 

156,805,643

 

Diluted per common share data:

 

 

 

 

 

 

 

Net income per share attributable to common shareholders - diluted

$

0.09

 

 

$

0.06

 

 

$

0.28

 

 

$

0.31

 

Weighted-average number of common shares

 

153,240,169

 

 

 

155,081,645

 

 

 

153,830,754

 

 

 

157,280,206

 

Note: The Statements of Comprehensive Income and corresponding notes to the consolidated financial statements can be found in the Company’s Quarterly Report on Form 10-Q.

 

RLJ Lodging Trust

Reconciliation of Non-GAAP Measures

(Amounts in thousands, except per share data)

(unaudited)

 

Funds from Operations (FFO) Attributable to Common Shareholders and Unitholders

 

For the three months ended September 30,

 

For the nine months ended September 30,

 

 

2024

 

 

 

2023

 

 

 

2024

 

 

 

2023

 

Net income

$

20,643

 

 

$

16,343

 

 

$

62,680

 

 

$

68,577

 

Preferred dividends

 

(6,279

)

 

 

(6,279

)

 

 

(18,836

)

 

 

(18,836

)

Depreciation and amortization

 

44,892

 

 

 

44,727

 

 

 

134,045

 

 

 

134,648

 

(Gain) loss on sale of hotel properties, net

 

(4,755

)

 

 

(16

)

 

 

(8,301

)

 

 

28

 

Noncontrolling interest in consolidated joint ventures

 

8

 

 

 

137

 

 

 

181

 

 

 

131

 

Adjustments related to consolidated joint venture (1)

 

(47

)

 

 

(44

)

 

 

(139

)

 

 

(131

)

Adjustments related to unconsolidated joint venture (2)

 

227

 

 

 

236

 

 

 

685

 

 

 

709

 

FFO

 

54,689

 

 

 

55,104

 

 

 

170,315

 

 

 

185,126

 

Transaction costs

 

209

 

 

 

2

 

 

 

299

 

 

 

26

 

Pre-opening costs (3)

 

888

 

 

 

327

 

 

 

1,088

 

 

 

1,188

 

Loss on extinguishment of indebtedness, net

 

129

 

 

 

—

 

 

 

129

 

 

 

169

 

Amortization of share-based compensation

 

4,550

 

 

 

6,247

 

 

 

16,260

 

 

 

18,028

 

Non-cash interest expense related to discontinued interest rate hedges

 

386

 

 

 

482

 

 

 

1,287

 

 

 

1,446

 

Other expenses (4)

 

304

 

 

 

930

 

 

 

2,256

 

 

 

1,026

 

Adjusted FFO

$

61,155

 

 

$

63,092

 

 

$

191,634

 

 

$

207,009

 

 

 

 

 

 

 

 

 

Adjusted FFO per common share and unit-basic

$

0.40

 

 

$

0.41

 

 

$

1.24

 

 

$

1.31

 

Adjusted FFO per common share and unit-diluted

$

0.40

 

 

$

0.40

 

 

$

1.24

 

 

$

1.31

 

 

 

 

 

 

 

 

 

Basic weighted-average common shares and units outstanding (5)

 

153,842

 

 

 

155,335

 

 

 

153,999

 

 

 

157,577

 

Diluted weighted-average common shares and units outstanding (5)

 

154,012

 

 

 

155,853

 

 

 

154,603

 

 

 

158,052

Notes:

(1)

Includes depreciation and amortization expense allocated to the noncontrolling interest in the consolidated joint venture.

(2)

Includes our ownership interest in the depreciation and amortization expense of the unconsolidated joint venture.

(3)

Represents expenses related to the brand conversions of certain hotel properties prior to opening.

(4)

Represents expenses and income outside of the normal course of operations.

(5)

Includes 0.8 million weighted-average operating partnership units for the three and nine month periods ended September 30, 2024 and 2023.

 

RLJ Lodging Trust

Reconciliation of Non-GAAP Measures

(Amounts in thousands)

(unaudited)

 

Earnings Before Interest, Taxes, Depreciation and Amortization (EBITDA)

 

For the three months ended September 30,

 

For the nine months ended September 30,

 

 

2024

 

 

 

2023

 

 

 

2024

 

 

 

2023

 

Net income

$

20,643

 

 

$

16,343

 

 

$

62,680

 

 

$

68,577

 

Depreciation and amortization

 

44,892

 

 

 

44,727

 

 

 

134,045

 

 

 

134,648

 

Interest expense, net of interest income

 

24,357

 

 

 

19,531

 

 

 

69,959

 

 

 

59,529

 

Income tax expense

 

379

 

 

 

332

 

 

 

1,081

 

 

 

1,028

 

Adjustments related to unconsolidated joint venture (1)

 

331

 

 

 

344

 

 

 

998

 

 

 

1,034

 

EBITDA

 

90,602

 

 

 

81,277

 

 

 

268,763

 

 

 

264,816

 

(Gain) loss on sale of hotel properties, net

 

(4,755

)

 

 

(16

)

 

 

(8,301

)

 

 

28

 

EBITDAre

 

85,847

 

 

 

81,261

 

 

 

260,462

 

 

 

264,844

 

Transaction costs

 

209

 

 

 

2

 

 

 

299

 

 

 

26

 

Pre-opening costs (2)

 

888

 

 

 

327

 

 

 

1,088

 

 

 

1,188

 

Loss on extinguishment of indebtedness, net

 

129

 

 

 

—

 

 

 

129

 

 

 

169

 

Amortization of share-based compensation

 

4,550

 

 

 

6,247

 

 

 

16,260

 

 

 

18,028

 

Other expenses (3)

 

304

 

 

 

930

 

 

 

2,256

 

 

 

1,026

 

Adjusted EBITDA

 

91,927

 

 

 

88,767

 

 

 

280,494

 

 

 

285,281

 

General and administrative

 

8,231

 

 

 

8,500

 

 

 

25,566

 

 

 

25,002

 

Other corporate adjustments

 

929

 

 

 

873

 

 

 

2,285

 

 

 

2,009

 

Consolidated Hotel EBITDA

 

101,087

 

 

 

98,140

 

 

 

308,345

 

 

 

312,292

 

Comparable adjustments - income from sold hotels

 

(400

)

 

 

(785

)

 

 

(1,232

)

 

 

(2,171

)

Comparable adjustments - income from acquired hotels

 

—

 

 

 

801

 

 

 

525

 

 

 

2,144

 

Comparable Hotel EBITDA

$

100,687

 

 

$

98,156

 

 

$

307,638

 

 

$

312,265

 

Notes:

(1)

Includes our ownership interest in the interest, depreciation, and amortization expense of the unconsolidated joint venture.

(2)

Represents expenses related to the brand conversions of certain hotel properties prior to opening.

(3)

Represents expenses and income outside of the normal course of operations.

 

RLJ Lodging Trust

Reconciliation of Non-GAAP Measures

(Amounts in thousands except margin data)

(unaudited)

 

Comparable Hotel EBITDA Margin

 

For the three months ended September 30,

 

For the nine months ended September 30,

 

 

2024

 

 

 

2023

 

 

 

2024

 

 

 

2023

 

Total revenue

$

345,744

 

 

$

334,406

 

 

$

1,039,451

 

 

$

1,005,869

 

Comparable adjustments - revenue from sold hotels

 

(1,000

)

 

 

(2,115

)

 

 

(3,879

)

 

 

(5,551

)

Comparable adjustments - revenue from prior ownership of acquired hotels

 

—

 

 

 

2,518

 

 

 

3,834

 

 

 

7,167

 

Other corporate adjustments / non-hotel revenue

 

(18

)

 

 

(17

)

 

 

(53

)

 

 

(52

)

Comparable Hotel Revenue

$

344,727

 

 

$

334,792

 

 

$

1,039,353

 

 

$

1,007,433

 

 

 

 

 

 

 

 

 

Comparable Hotel EBITDA

$

100,687

 

 

$

98,156

 

 

$

307,638

 

 

$

312,265

 

 

 

 

 

 

 

 

 

Comparable Hotel EBITDA Margin

 

29.2

%

 

 

29.3

%

 

 

29.6

%

 

 

31.0

%

 

RLJ Lodging Trust

Reconciliation of Non-GAAP Measures - Full-Year Outlook

(Amounts in millions)

(unaudited)

 

Earnings Before Interest, Taxes, Depreciation and Amortization (EBITDA)

 

For the year ended December 31, 2024

 

Low End

 

High End

Net income

$

50.0

 

 

$

68.0

 

Depreciation and amortization

 

187.0

 

 

 

187.0

 

Interest expense, net of interest income

 

92.0

 

 

 

94.0

 

Income tax expense

 

1.5

 

 

 

1.5

 

Adjustments related to joint ventures

 

1.5

 

 

 

1.5

 

EBITDA

 

332.0

 

 

 

352.0

 

Gain on sale of hotel properties, net

 

(8.5

)

 

 

(8.5

)

EBITDAre

 

323.5

 

 

 

343.5

 

Amortization of share-based compensation

 

21.0

 

 

 

21.0

 

All other items, net

 

2.0

 

 

 

2.0

 

Adjusted EBITDA

 

346.5

 

 

 

366.5

 

General and administrative

 

36.0

 

 

 

36.0

 

Consolidated Hotel EBITDA

 

382.5

 

 

 

402.5

 

Comparable adjustments - income from sold hotels

 

(0.5

)

 

 

(0.5

)

Comparable adjustments - income from acquired hotels

 

0.5

 

 

 

0.5

 

Comparable Hotel EBITDA

$

382.5

 

 

$

402.5

 

 

Funds from Operations (FFO) Attributable to Common Shareholders and Unitholders

 

For the year ended December 31, 2024

 

Low End

 

High End

Net income

$

50.0

 

 

$

68.0

 

Preferred dividends

 

(25.0

)

 

 

(25.0

)

Depreciation and amortization

 

187.0

 

 

 

187.0

 

Gain on sale of hotel properties, net

 

(8.5

)

 

 

(8.5

)

Adjustments related to joint ventures

 

1.0

 

 

 

1.0

 

FFO

 

204.5

 

 

 

222.5

 

Amortization of share-based compensation

 

21.0

 

 

 

21.0

 

All other items, net

 

(1.0

)

 

 

1.0

 

Adjusted FFO

$

224.5

 

 

$

244.5

 

 

 

 

 

Adjusted FFO per common share and unit-diluted

$

1.45

 

 

$

1.58

 

 

 

 

 

Diluted weighted-average common shares and units outstanding

 

154.5

 

 

 

154.5

 

 

RLJ Lodging Trust

Consolidated Debt Summary

(Amounts in thousands except interest data)

(unaudited)

 

Loan

Base Term

(Years)

Maturity

(incl. extensions)

Floating / Fixed (1)

Interest Rate (2)

 

Balance as of

September 30, 2024 (3)

Mortgage Debt

 

 

 

 

 

 

Mortgage loan - 1 hotel

10

Jan 2029

Fixed

5.06%

 

$

25,000

Mortgage loan - 3 hotels

5

Apr 2026

Floating

4.78%

 

 

96,000

 

Mortgage loan - 4 hotels

5

Apr 2026

Floating

5.29%

 

 

85,000

 

Weighted Average / Mortgage Total

 

 

 

5.02%

 

$

206,000

 

 

 

 

 

 

 

 

Corporate Debt

 

 

 

 

 

 

Revolver (4)

4

May 2028

Floating

6.59%

 

$

100,000

 

$225 Million Term Loan Maturing 2026

3

May 2028

Floating

3.91%

 

 

225,000

 

$200 Million Term Loan Maturing 2026

3

January 2028

Floating

6.55%

 

 

200,000

 

$500 Million Term Loan Maturing 2027

3

September 2029

Floating

4.82%

 

 

500,000

 

$500 Million Senior Notes due 2026

5

July 2026

Fixed

3.75%

 

 

500,000

 

$500 Million Senior Notes due 2029

8

September 2029

Fixed

4.00%

 

 

500,000

 

Weighted Average / Corporate Total

 

 

 

4.51%

 

$

2,025,000

 

 

 

 

 

 

 

 

Weighted Average / Total

 

 

 

4.56%

 

$

2,231,000

 

Notes:

(1)

The floating interest rate is hedged, or partially hedged, with an interest rate swap.

(2)

Interest rates as of September 30, 2024, inclusive of the impact of interest rate hedges.

(3)

Excludes the impact of fair value adjustments and deferred financing costs.

(4)

As of September 30, 2024, there was $500.0 million of borrowing capacity on the Revolver, which is charged an unused commitment fee of 0.25% annually.

 

View source version on businesswire.com: https://www.businesswire.com/news/home/20241106929414/en/

Sean M. Mahoney, Executive Vice President and Chief Financial Officer – (301) 280-7774