Core Insights - The article emphasizes the importance of value investing, highlighting the identification of undervalued companies through fundamental analysis and metrics [2][8] - It introduces Zacks' Style Scores system, which helps investors find stocks with specific traits, particularly those with high grades in the Value category [3] Company Analysis - Braemar Hotels & Resorts (BHR) has a Zacks Rank of 1 (Strong Buy) and an A grade for Value, with a Forward P/E ratio of 5.41, significantly lower than the industry average of 15.75 [4] - BHR's P/B ratio is 0.71, compared to the industry's average P/B of 1.80, indicating it is undervalued [5] - City Office REIT (CIO) holds a Zacks Rank of 2 (Buy) and an A grade for Value, with a Forward P/E ratio of 4.87 and a PEG ratio of 0.81, both favorable compared to the industry averages [6] - CIO's P/B ratio is 0.36, also lower than the industry's average P/B of 1.80, suggesting it is undervalued [7] Investment Outlook - Both BHR and CIO are highlighted as strong value stocks, likely undervalued based on their earnings outlook and valuation metrics [8]

Core Insights - The article emphasizes the importance of a proven ranking system that focuses on earnings estimates and revisions to identify winning stocks [1] - Value investing is highlighted as a popular strategy for finding great stocks across various market conditions [2] - The Zacks Rank and Style Scores system are tools for investors to identify stocks with specific traits, particularly in the "Value" category [3] Company Analysis: Braemar Hotels & Resorts (BHR) - Braemar Hotels & Resorts currently holds a Zacks Rank of 1 (Strong Buy) and an A grade for Value, indicating strong investment potential [4] - The stock is trading at a P/E ratio of 5.24, significantly lower than the industry average P/E of 15.62, suggesting it may be undervalued [4] - BHR's Forward P/E has fluctuated between 3.52 and 7.43 over the past year, with a median of 5.36, further indicating its valuation status [4] - The P/B ratio for BHR is 0.68, which is also lower than the industry average P/B of 1.78, reinforcing the notion of undervaluation [5] - Over the past year, BHR's P/B has ranged from 0.53 to 0.94, with a median of 0.73, highlighting its strong value metrics [5] - Overall, BHR's strong value grade and positive earnings outlook suggest it is an impressive value stock at the moment [6]

1st Quarter 2025 Earnings Update Four Seasons Scottsdale Forward Looking Statements and Non-GAAP Measures In keeping with the SEC's "Safe Harbor" guidelines, certain statements made during this presentation could be considered forward-looking and subject to certain risks and uncertainties that could cause results to differ materially from those projected. When we use the words "will likely result," "may," "anticipate," "estimate," "should," "expect," "believe," "intend," or similar expressions, we intend to ...

PART I. FINANCIAL INFORMATION This section presents the company's unaudited condensed consolidated financial statements and management's discussion and analysis for Q1 2025 [ITEM 1. FINANCIAL STATEMENTS (unaudited)](index=3&type=section&id=ITEM%201.%20FINANCIAL%20STATEMENTS%20(unaudited)) This section presents Braemar Hotels & Resorts Inc.'s unaudited condensed consolidated financial statements and accompanying notes for Q1 2025 [Condensed Consolidated Balance Sheets](index=3&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) This statement provides a snapshot of the company's assets, liabilities, and equity at specific points in time Condensed Consolidated Balance Sheets (in thousands) | Metric | March 31, 2025 (in thousands) | December 31, 2024 (in thousands) | | :-------------------------------- | :----------------------------- | :----------------------------- | | Total assets | $2,098,029 | $2,136,059 | | Total liabilities | $1,402,332 | $1,413,889 | | Total equity | $235,477 | $237,362 | - Investments in hotel properties, net, decreased from **$1.78 billion** at December 31, 2024, to **$1.77 billion** at March 31, 2025[11](index=11&type=chunk) - Cash and cash equivalents decreased significantly from **$135.5 million** at December 31, 2024, to **$81.7 million** at March 31, 2025[11](index=11&type=chunk) [Condensed Consolidated Statements of Operations](index=4&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations) This statement details the company's revenues, expenses, and net income or loss over a specific period Condensed Consolidated Statements of Operations (in thousands) | Metric | Three Months Ended March 31, 2025 (in thousands) | Three Months Ended March 31, 2024 (in thousands) | | :------------------------------------------ | :------------------------------------------ | :------------------------------------------ | | Total hotel revenue | $215,820 | $219,079 | | Total operating expenses | $179,080 | $176,612 | | Operating income (loss) | $36,740 | $42,467 | | Net income (loss) attributable to the Company | $10,998 | $15,929 | | Net income (loss) attributable to common stockholders | $(2,547) | $3,524 | | Income (loss) per share - basic | $(0.04) | $0.05 | | Income (loss) per share - diluted | $(0.04) | $0.05 | - Net income attributable to the Company decreased by **$4.9 million**, from **$15.9 million** in Q1 2024 to **$11.0 million** in Q1 2025[13](index=13&type=chunk) - Total hotel revenue decreased by **1.5%** year-over-year, from **$219.1 million** in Q1 2024 to **$215.8 million** in Q1 2025[13](index=13&type=chunk) [Condensed Consolidated Statements of Comprehensive Income (Loss)](index=5&type=section&id=Condensed%20Consolidated%20Statements%20of%20Comprehensive%20Income%20(Loss)) This statement presents net income and other comprehensive income items, reflecting total changes in equity from non-owner sources Condensed Consolidated Statements of Comprehensive Income (Loss) (in thousands) | Metric | Three Months Ended March 31, 2025 (in thousands) | Three Months Ended March 31, 2024 (in thousands) | | :---------------------------------------------------- | :------------------------------------------ | :------------------------------------------ | | Net income (loss) | $10,672 | $15,482 | | Unrealized gain (loss) on investment in securities | $859 | $0 | | Total comprehensive income (loss) | $11,531 | $15,482 | | Comprehensive income (loss) attributable to the Company | $11,777 | $15,929 | - The company reported an unrealized gain on investment in securities of **$859 thousand** in Q1 2025, compared to zero in Q1 2024[14](index=14&type=chunk) [Condensed Consolidated Statements of Equity](index=6&type=section&id=Condensed%20Consolidated%20Statements%20of%20Equity) This statement outlines changes in the company's equity accounts, including common stock, preferred stock, and retained earnings Condensed Consolidated Statements of Equity (in thousands) | Metric | March 31, 2025 (in thousands) | December 31, 2024 (in thousands) | | :------------------------------------------ | :----------------------------- | :----------------------------- | | Total stockholders' equity of the Company | $238,908 | $240,729 | | Common stock shares outstanding | 67,047 | 66,608 | | Series E redeemable preferred stock shares | 13,910 | 14,911 | | Series M redeemable preferred stock shares | 1,459 | 1,477 | - Total stockholders' equity of the Company decreased from **$240.7 million** at December 31, 2024, to **$238.9 million** at March 31, 2025[17](index=17&type=chunk) - Redemption/conversion of operating partnership units resulted in a **$2.25 million** increase in total equity for the three months ended March 31, 2025[17](index=17&type=chunk) [Condensed Consolidated Statements of Cash Flows](index=8&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) This statement categorizes cash inflows and outflows from operating, investing, and financing activities for the period Condensed Consolidated Statements of Cash Flows (in thousands) | Metric | Three Months Ended March 31, 2025 (in thousands) | Three Months Ended March 31, 2024 (in thousands) | | :------------------------------------------ | :------------------------------------------ | :------------------------------------------ | | Net cash provided by (used in) operating activities | $15,146 | $36,039 | | Net cash provided by (used in) investing activities | $(14,204) | $(22,828) | | Net cash provided by (used in) financing activities | $(49,764) | $39,709 | | Net change in cash, cash equivalents and restricted cash | $(48,822) | $52,920 | | Cash, cash equivalents and restricted cash at end of period | $136,235 | $219,423 | - Net cash provided by operating activities decreased significantly from **$36.0 million** in Q1 2024 to **$15.1 million** in Q1 2025[21](index=21&type=chunk) - Net cash used in financing activities was **$49.8 million** in Q1 2025, a substantial shift from **$39.7 million** provided by financing activities in Q1 2024, primarily due to higher repayments of indebtedness and preferred stock redemptions[21](index=21&type=chunk)[209](index=209&type=chunk)[210](index=210&type=chunk) [Notes to Condensed Consolidated Financial Statements](index=10&type=section&id=Notes%20to%20Condensed%20Consolidated%20Financial%20Statements) These notes provide detailed explanations and additional information supporting the condensed consolidated financial statements [Note 1. Organization and Description of Business](index=10&type=section&id=Note%201.%20Organization%20and%20Description%20of%20Business) This note describes the company's corporate structure, business model as a REIT, and its hotel property portfolio - Braemar Hotels & Resorts Inc. is a Maryland corporation that invests primarily in high RevPAR luxury hotels and resorts, operating as a REIT[25](index=25&type=chunk) - The company owns **15 hotel properties** across seven states, the District of Columbia, Puerto Rico, and the U.S. Virgin Islands, totaling **3,807 rooms** (**3,667 net rooms**)[29](index=29&type=chunk) - Braemar is advised by Ashford Hospitality Advisors LLC and does not directly operate its hotels, instead engaging hotel management companies, including Remington Hospitality (a subsidiary of Ashford Inc.) for four properties[26](index=26&type=chunk)[27](index=27&type=chunk) [Note 2. Significant Accounting Policies](index=10&type=section&id=Note%202.%20Significant%20Accounting%20Policies) This note outlines the key accounting principles and methods used in preparing the financial statements - The unaudited condensed consolidated financial statements are prepared in accordance with GAAP for interim financial information and include accounts of wholly-owned and majority-owned subsidiaries[31](index=31&type=chunk) - Braemar OP is consolidated as a variable interest entity (VIE) because Braemar has the power to direct its activities and absorb losses/receive benefits[33](index=33&type=chunk) - New accounting standards ASU 2023-09 (Income Tax Disclosures) and ASU 2024-03 (Expense Disaggregation Disclosures) are effective for annual periods beginning January 1, 2025, and after December 15, 2026, respectively, with early adoption permitted[35](index=35&type=chunk)[36](index=36&type=chunk)[37](index=37&type=chunk) [Note 3. Revenue](index=12&type=section&id=Note%203.%20Revenue) This note disaggregates total hotel revenue by geographical market for the reported periods Total Hotel Revenue by Geographical Market (in thousands) | Primary Geographical Market | Three Months Ended March 31, 2025 | Three Months Ended March 31, 2024 | | :-------------------------- | :-------------------------------- | :-------------------------------- | | California | $38,366 | $36,361 | | Puerto Rico | $29,376 | $27,210 | | Arizona | $25,886 | $24,693 | | Colorado | $22,403 | $22,582 | | Florida | $39,810 | $39,699 | | Illinois | $4,318 | $4,730 | | Pennsylvania | $7,682 | $5,908 | | Washington | $6,296 | $5,703 | | Washington, D.C. | $17,307 | $15,457 | | USVI | $24,376 | $24,996 | | Sold hotel property (2024) | — | $11,740 | | **Total** | **$215,820** | **$219,079** | - Total hotel revenue decreased from **$219.1 million** in Q1 2024 to **$215.8 million** in Q1 2025, partly due to the disposition of a hotel property[39](index=39&type=chunk) - Florida, California, and Puerto Rico were the top three revenue-generating geographical markets in Q1 2025[39](index=39&type=chunk) [Note 4. Investments in Hotel Properties, net](index=12&type=section&id=Note%204.%20Investments%20in%20Hotel%20Properties%2C%20net) This note details the composition and net book value of the company's hotel property investments Investments in Hotel Properties, net (in thousands) | Asset Category | March 31, 2025 | December 31, 2024 | | :-------------------------- | :------------- | :---------------- | | Land | $630,842 | $630,842 | | Buildings and improvements | $1,429,225 | $1,430,096 | | Furniture, fixtures and equipment | $164,731 | $158,470 | | Construction in progress | $20,121 | $20,420 | | Residences | $12,746 | $12,746 | | Total cost | $2,257,665 | $2,252,574 | | Accumulated depreciation | $(487,720) | $(473,888) | | **Investments in hotel properties, net** | **$1,769,945** | **$1,778,686** | - Net investments in hotel properties decreased by **$8.7 million** from December 31, 2024, to March 31, 2025[40](index=40&type=chunk) - No impairment charges were recorded for the three months ended March 31, 2025, or 2024[41](index=41&type=chunk) [Note 5. Hotel Disposition](index=12&type=section&id=Note%205.%20Hotel%20Disposition) This note provides information on the sale of a hotel property, including the gain recognized and its operating results prior to disposition - On July 17, 2024, the Company sold the Hilton La Jolla Torrey Pines for **$165 million** in cash, resulting in a gain of approximately **$88.1 million** for the year ended December 31, 2024[42](index=42&type=chunk)[43](index=43&type=chunk) Operating Results for Hilton La Jolla Torrey Pines (Three Months Ended March 31, 2024, in thousands) | Metric | Amount | | :-------------------------------------------------------------------------------- | :----- | | Total hotel revenue | $11,740 | | Total hotel operating expenses | $(7,193) | | Operating income (loss) | $2,668 | | Income (loss) before income taxes attributable to the Company | $247 | [Note 6. Indebtedness, net](index=14&type=section&id=Note%206.%20Indebtedness%2C%20net) This note details the company's mortgage loans and convertible senior notes, including refinancing activities Indebtedness, net (in thousands) | Indebtedness Type | March 31, 2025 | December 31, 2024 | | :---------------- | :------------- | :---------------- | | Mortgage loans | $1,134,513 | $1,136,693 | | Convertible Senior Notes | $86,250 | $86,250 | | Deferred loan costs, net | $(17,316) | $(11,985) | | Premiums/(discounts), net | $(779) | $(940) | | **Indebtedness, net** | **$1,202,668** | **$1,210,018** | - On March 7, 2025, the company refinanced two mortgage loans into a new **$363.0 million** mortgage loan at SOFR + **2.52%**, with a two-year initial term and three one-year extension options[45](index=45&type=chunk)[46](index=46&type=chunk) - The company was in compliance with all debt covenants as of March 31, 2025[50](index=50&type=chunk) [Note 7. Note Receivable](index=15&type=section&id=Note%207.%20Note%20Receivable) This note describes an unsecured loan provided by the company and its associated interest income - The company provided an unsecured loan to BW Coinvest I, LLC, with proceeds used to purchase **3.5 million** shares of Braemar common stock[53](index=53&type=chunk)[54](index=54&type=chunk) Note Receivable (in thousands) | Line Item | Interest Rate | March 31, 2025 | December 31, 2024 | | :---------- | :------------ | :------------- | :---------------- | | Note receivable | SOFR + 3.00% | $8,434 | $8,283 | - Interest income from the note receivable was **$152 thousand** for the three months ended March 31, 2025[56](index=56&type=chunk) [Note 8. Fair Value Measurements](index=16&type=section&id=Note%208.%20Fair%20Value%20Measurements) This note explains the methodology and hierarchy used for measuring financial instruments at fair value - Financial instruments measured at fair value are classified into a three-level hierarchy based on observability of inputs: Level 1 (quoted prices in active markets), Level 2 (observable inputs other than Level 1), and Level 3 (unobservable inputs)[57](index=57&type=chunk)[60](index=60&type=chunk) - Interest rate caps are valued using market standard methodology, discounting future expected cash receipts based on observable market interest rate curves (SOFR forward curves) and volatilities (Level 2 inputs)[57](index=57&type=chunk)[58](index=58&type=chunk) Assets Measured at Fair Value on a Recurring Basis (in thousands) | Asset Category | March 31, 2025 (Level 2) | December 31, 2024 (Level 2) | | :-------------------------- | :----------------------- | :-------------------------- | | CMBS | $42,394 | $41,535 | | Interest rate derivatives - caps | $478 | $356 | | **Total** | **$42,872** | **$41,891** | [Note 9. Summary of Fair Value of Financial Instruments](index=19&type=section&id=Note%209.%20Summary%20of%20Fair%20Value%20of%20Financial%20Instruments) This note presents the carrying amounts and estimated fair values of various financial instruments Carrying Amounts and Estimated Fair Values of Financial Instruments (in thousands) | Instrument | March 31, 2025 Carrying Value | March 31, 2025 Estimated Fair Value | December 31, 2024 Carrying Value | December 31, 2024 Estimated Fair Value | | :-------------------------------- | :------------------------------ | :---------------------------------- | :------------------------------- | :----------------------------------- | | Investment in securities | $42,394 | $42,394 | $41,535 | $41,535 | | Derivative assets | $478 | $478 | $356 | $356 | | Cash and cash equivalents | $81,689 | $81,689 | $135,465 | $135,465 | | Indebtedness | $1,219,984 | $1,218,557 | $1,222,003 | $1,207,420 | - The fair value of total indebtedness was estimated at approximately **99.9%** of its carrying value (**$1.2 billion**) as of March 31, 2025, and **98.8%** as of December 31, 2024[70](index=70&type=chunk) - The carrying values of short-term financial assets and liabilities (cash, receivables, payables) approximate their fair values due to their short-term nature (Level 1 valuation)[67](index=67&type=chunk) [Note 10. Income (Loss) Per Share](index=20&type=section&id=Note%2010.%20Income%20(Loss)%20Per%20Share) This note reconciles the calculation of basic and diluted income (loss) per share Income (Loss) Per Share Reconciliation (in thousands, except per share amounts) | Metric | Three Months Ended March 31, 2025 | Three Months Ended March 31, 2024 | | :------------------------------------------ | :-------------------------------- | :-------------------------------- | | Net income (loss) attributable to common stockholders | $(2,547) | $3,524 | | Weighted average common shares outstanding – basic | 66,744 | 66,455 | | Income (loss) per share - basic | $(0.04) | $0.05 | | Weighted average common shares outstanding – diluted | 66,744 | 268,516 | | Income (loss) per share - diluted | $(0.04) | $0.05 | - Diluted EPS was **$(0.04)** in Q1 2025, a decrease from **$0.05** in Q1 2024, primarily due to a decrease in net income attributable to common stockholders[71](index=71&type=chunk) - The computation of diluted EPS for Q1 2025 did not reflect adjustments for certain items (e.g., preferred stock conversions) due to their anti-dilutive effect[71](index=71&type=chunk) [Note 11. Redeemable Noncontrolling Interests in Operating Partnership](index=21&type=section&id=Note%2011.%20Redeemable%20Noncontrolling%20Interests%20in%20Operating%20Partnership) This note details the equity interests held by limited partners in the operating partnership - Redeemable noncontrolling interests represent limited partners' share of equity and earnings/losses in Braemar OP, based on common units and vested LTIP units[72](index=72&type=chunk) - LTIP units, issued as compensation, generally vest over three years and can convert to common units upon achieving economic parity[73](index=73&type=chunk) Redeemable Noncontrolling Interests in Braemar OP (in thousands) | Metric | March 31, 2025 | December 31, 2024 | | :------------------------------------------ | :------------- | :---------------- | | Redeemable noncontrolling interests in Braemar OP | $26,430 | $29,964 | | Ownership percentage of operating partnership | 9.33 % | 8.05 % | | Net (income) loss attributable to redeemable noncontrolling interests in operating partnership | $262 | $(296) | [Note 12. Equity and Stock-Based Compensation](index=22&type=section&id=Note%2012.%20Equity%20and%20Stock-Based%20Compensation) This note provides information on common stock dividends, share repurchase programs, and stock-based compensation plans - Common stock dividends declared were **$3.372 million** for Q1 2025, slightly up from **$3.345 million** in Q1 2024[79](index=79&type=chunk) - A new share repurchase program for up to **$50 million** was approved on May 3, 2024, but no common stock has been repurchased under this program as of March 31, 2025[79](index=79&type=chunk) - Performance Stock Units (PSUs) are granted to executive officers and directors, vesting based on performance targets over a three-year period, with compensation cost recognized ratably[81](index=81&type=chunk) [Note 13. Redeemable Preferred Stock](index=23&type=section&id=Note%2013.%20Redeemable%20Preferred%20Stock) This note describes the various series of redeemable preferred stock and their dividend declarations - The company has three series of redeemable preferred stock: **5.50% Series B Cumulative Convertible Preferred Stock**, **Series E Redeemable Preferred Stock**, and **Series M Redeemable Preferred Stock**[84](index=84&type=chunk)[88](index=88&type=chunk)[100](index=100&type=chunk) - All series of preferred stock are classified outside of permanent equity due to cash redemption features outside the company's control[87](index=87&type=chunk)[96](index=96&type=chunk)[109](index=109&type=chunk) Preferred Stock Dividends Declared (in thousands) | Preferred Stock Series | Three Months Ended March 31, 2025 | Three Months Ended March 31, 2024 | | :--------------------- | :-------------------------------- | :-------------------------------- | | Series D | $825 | $825 | | Series B | $1,058 | $1,058 | | Series E | $7,600 | $6,616 | | Series M | $770 | $924 | [Note 14. Related Party Transactions](index=26&type=section&id=Note%2014.%20Related%20Party%20Transactions) This note discloses transactions and fees with related parties, including the company's advisor - Ashford LLC, a subsidiary of Ashford Inc., acts as the company's advisor, providing advisory, asset management, and other services[111](index=111&type=chunk)[113](index=113&type=chunk) Advisory Services Fees Incurred (in thousands) | Fee Type | Three Months Ended March 31, 2025 | Three Months Ended March 31, 2024 | | :-------------------------- | :-------------------------------- | :-------------------------------- | | Base advisory fee | $3,576 | $3,327 | | Reimbursable expenses | $3,001 | $2,265 | | Equity-based compensation | $(48) | $1,108 | | Incentive fee | $82 | $0 | | **Total** | **$6,611** | **$6,700** | - The company incurred **$1.7 million** in fees from Lismore (or its subsidiaries) for debt placement and brokerage services in Q1 2025, up from **$1.1 million** in Q1 2024[116](index=116&type=chunk) [Note 15. Commitments and Contingencies](index=28&type=section&id=Note%2015.%20Commitments%20and%20Contingencies) This note outlines the company's legal proceedings, class action lawsuits, and contractual commitments - The company is involved in several class action lawsuits related to California employment laws, with tentative settlements reached for some cases, and estimated liabilities accrued as of March 31, 2025[130](index=130&type=chunk)[131](index=131&type=chunk)[132](index=132&type=chunk) - A class action lawsuit related to a cyber incident in Q3 2023 has reached a tentative settlement of approximately **$485,000**, with final court approval scheduled for August 27, 2025[135](index=135&type=chunk) - The company is required to make escrow payments for insurance, real estate taxes, debt service, and capital improvements (**3% to 5%** of gross revenues) under certain management and debt agreements[126](index=126&type=chunk) [Note 16. Segment Reporting](index=30&type=section&id=Note%2016.%20Segment%20Reporting) This note identifies the company's single reportable business segment and its key performance metric, Hotel Adjusted EBITDA - The company operates in one reportable business segment: direct hotel investments, which involves owning hotel properties through acquisition or new development[137](index=137&type=chunk) - The Chief Operating Decision Maker (CODM) reviews and makes decisions based on individual hotel net income (loss) before interest expense, income taxes, depreciation, and amortization, adjusted for certain items (Hotel Adjusted EBITDA)[139](index=139&type=chunk) Hotel Adjusted EBITDA Reconciliation (in thousands) | Metric | Three Months Ended March 31, 2025 | Three Months Ended March 31, 2024 | | :------------------------------------------ | :-------------------------------- | :-------------------------------- | | Total hotel revenue | $215,820 | $219,079 | | Total expenses | $145,079 | $148,100 | | **Hotel adjusted EBITDA** | **$70,741** | **$70,979** | | Net income (loss) | $10,672 | $15,482 | [ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS](index=32&type=section&id=ITEM%202.%20MANAGEMENT%27S%20DISCUSSION%20AND%20ANALYSIS%20OF%20FINANCIAL%20CONDITION%20AND%20RESULTS%20OF%20OPERATIONS) This section analyzes the company's financial condition and operating results for Q1 2025, covering liquidity, capital, and non-GAAP measures [Forward-Looking Statements](index=32&type=section&id=Forward-Looking%20Statements) This section cautions readers about statements regarding future events and financial performance, which are subject to risks - The report contains forward-looking statements identifiable by terms like 'may,' 'will,' 'expect,' and 'anticipate,' covering business strategy, asset purchases/sales, operating results, capital expenditures, and technology impact[142](index=142&type=chunk)[144](index=144&type=chunk) - These statements are based on current beliefs and expectations, but actual results may vary materially due to various risks and uncertainties, including changes in interest rates, macroeconomic conditions, and capital market volatility[143](index=143&type=chunk)[144](index=144&type=chunk) - Readers are cautioned not to place undue reliance on forward-looking statements, and the company does not intend to update them except as required by law[145](index=145&type=chunk) [Overview](index=34&type=section&id=Overview) This section provides a high-level summary of the company's business, investment strategy, and advisory structure - Braemar Hotels & Resorts Inc. is a Maryland REIT focused on high RevPAR luxury hotels and resorts, owning interests in **15 hotel properties** across the U.S. and its territories[146](index=146&type=chunk)[147](index=147&type=chunk) - The company is advised by Ashford LLC and does not directly operate its hotels, instead contracting hotel management companies, including Remington Hospitality for four properties[148](index=148&type=chunk)[149](index=149&type=chunk) - Mr. Monty J. Bennett and Mr. Archie Bennett, Jr. hold a controlling interest in Ashford Inc. and collectively owned approximately **4.2%** of Braemar's common stock as of March 31, 2025[151](index=151&type=chunk)[152](index=152&type=chunk) [Recent Developments](index=35&type=section&id=Recent%20Developments) This section highlights significant events and transactions, including loan refinancings and property management changes - On January 14, 2025, the mortgage loan for The Ritz-Carlton Lake Tahoe was amended, including a **$10.0 million** principal pay down, extending maturity to July 2025, and reducing the interest rate to SOFR + **3.25%**[154](index=154&type=chunk) - On March 7, 2025, the company refinanced two mortgage loans into a new **$363.0 million** mortgage loan at SOFR + **2.52%**, secured by five hotels, representing an approximate **49%** loan-to-value[155](index=155&type=chunk) - On May 5, 2025, the Sofitel Chicago Magnificent Mile transitioned from brand-managed to a franchise structure, now managed by Remington Hospitality, with planned renovations over the next two years[157](index=157&type=chunk) [Key Indicators of Operating Performance](index=35&type=section&id=Key%20Indicators%20of%20Operating%20Performance) This section defines the primary metrics used to evaluate hotel operations and overall business performance - The company uses Occupancy, Average Daily Rate (ADR), and Revenue Per Available Room (RevPAR) as key indicators to evaluate hotel operating performance[158](index=158&type=chunk)[160](index=160&type=chunk) - Changes in ADR typically have a greater impact on operating margins and profitability than changes in occupancy, as they do not substantially affect variable operating costs[159](index=159&type=chunk) - Non-GAAP measures such as Funds From Operations (FFO), Adjusted FFO, Earnings Before Interest, Taxes, Depreciation, and Amortization for real estate (EBITDAre), and Adjusted EBITDAre are also used to evaluate business operating performance[162](index=162&type=chunk) [Results of Operations (Three Months Ended March 31, 2025 Compared to Three Months Ended March 31, 2024)](index=37&type=section&id=Results%20of%20Operations%20(Three%20Months%20Ended%20March%2031%2C%202025%20Compared%20to%20Three%20Months%20Ended%20March%2031%2C%202024)) This section analyzes the financial performance for the quarter, comparing revenues, expenses, and key operating metrics year-over-year Key Financial Performance (in thousands, except percentages) | Metric | Q1 2025 | Q1 2024 | $ Change | % Change | | :------------------------------------------ | :------ | :------ | :------- | :------- | | Total hotel revenue | $215,820 | $219,079 | $(3,259) | (1.5)% | | Total operating expenses | $179,080 | $176,612 | $(2,468) | (1.4)% | | Operating income (loss) | $36,740 | $42,467 | $(5,727) | (13.5)% | | Net income (loss) attributable to the Company | $10,998 | $15,929 | $(4,931) | (31.0)% | Key Performance Indicators (All Hotel Properties) | Metric | Q1 2025 | Q1 2024 | | :----- | :-------- | :-------- | | Occupancy | 64.58 % | 65.39 % | | ADR | $611.38 | $551.46 | | RevPAR | $394.81 | $360.59 | | Rooms revenue (in thousands) | $136,092 | $138,552 | | Total hotel revenue (in thousands) | $215,820 | $219,079 | - Rooms revenue decreased by **$2.5 million**, primarily due to the sale of the Hilton La Jolla Torrey Pines in July 2024. Comparable hotel properties saw a **4.4%** increase in room rates but a **22 basis point** decrease in occupancy[165](index=165&type=chunk) - Interest expense and amortization of discounts and loan costs decreased by **$1.7 million** (**6.3%**) due to lower average SOFR rates (**4.32%** in Q1 2025 vs. **5.33%** in Q1 2024), partially offset by higher amortization of loan costs[185](index=185&type=chunk) [Liquidity and Capital Resources](index=42&type=section&id=Liquidity%20and%20Capital%20Resources) This section discusses the company's ability to meet short-term and long-term financial obligations and fund growth initiatives - Short-term liquidity requirements include operating expenses, advisory fees, maintenance, debt payments, and dividends, expected to be met by cash from operations, capital market activities, asset sales, and existing cash balances[191](index=191&type=chunk)[192](index=192&type=chunk)[195](index=195&type=chunk) - Long-term liquidity needs for acquisitions, redevelopments, and capital expenditures are expected to be met through equity issuances, working capital, cash from operations, and borrowings, but access to capital markets is subject to various factors[192](index=192&type=chunk)[193](index=193&type=chunk) - As of March 31, 2025, the company held **$81.7 million** in cash and cash equivalents and **$54.5 million** in restricted cash, with a net debt to gross assets ratio of **42.3%**[197](index=197&type=chunk) - The mortgage loan secured by The Ritz-Carlton Lake Tahoe was in a cash trap as of March 31, 2025, which could limit flexibility and affect financial condition[196](index=196&type=chunk) [Dividend Policy](index=45&type=section&id=Dividend%20Policy) This section outlines the company's approach to common stock dividends and factors influencing future declarations - The board of directors approved a dividend policy for 2025, expecting to pay a quarterly cash dividend of **$0.05 per share** for common stock, or **$0.20 per share** on an annualized basis[211](index=211&type=chunk) - Quarterly cash dividends of **$0.05 per diluted share** were declared for Q1 and Q2 2025[211](index=211&type=chunk) - The dividend policy does not commit the board to declare future dividends, which are reviewed quarterly and depend on operating results and economic outlook[211](index=211&type=chunk) [Seasonality](index=45&type=section&id=Seasonality) This section explains the impact of seasonal fluctuations on hotel operations and financial results - Hotel operations are seasonal, with higher occupancy rates during summer or winter months, leading to fluctuations in quarterly lease revenue[212](index=212&type=chunk) - Quarterly revenue can be adversely affected by renovations, management effectiveness, and external events like pandemics, extreme weather, or economic factors[212](index=212&type=chunk) - Borrowings are expected to fund REIT-required distributions if cash flows from operations are insufficient due to seasonal fluctuations[212](index=212&type=chunk) [Critical Accounting Policies and Estimates](index=45&type=section&id=Critical%20Accounting%20Policies%20and%20Estimates) This section identifies the accounting policies requiring significant management judgment and estimation - The preparation of financial statements requires management to make estimates and assumptions that affect reported amounts of assets, liabilities, revenue, and expenses[213](index=213&type=chunk) - There have been no material changes to the critical accounting policies described in the 2024 Annual Report on Form 10-K[213](index=213&type=chunk) [Non-GAAP Financial Measures](index=45&type=section&id=Non-GAAP%20Financial%20Measures) This section defines and reconciles non-GAAP financial metrics used to supplement GAAP results for performance evaluation - The company presents non-GAAP measures including EBITDA, EBITDAre, Adjusted EBITDAre, FFO, and Adjusted FFO to help investors evaluate operating performance[214](index=214&type=chunk)[217](index=217&type=chunk)[219](index=219&type=chunk) - Adjusted EBITDAre for Q1 2025 was **$63.0 million**, down from **$66.2 million** in Q1 2024[218](index=218&type=chunk) - Adjusted FFO available to common stockholders and OP unitholders was **$29.1 million** in Q1 2025, compared to **$30.3 million** in Q1 2024[221](index=221&type=chunk) [ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK](index=49&type=section&id=ITEM%203.%20QUANTITATIVE%20AND%20QUALITATIVE%20DISCLOSURES%20ABOUT%20MARKET%20RISK) This section discusses the company's primary market risk exposure, which is related to changes in interest rates on its variable-rate debt. It quantifies the potential impact of interest rate fluctuations on its financial results - The primary market risk exposure is changes in interest rates on approximately **$1.1 billion** of variable-rate debt as of March 31, 2025[225](index=225&type=chunk) - A **25-basis point** change in the interest rate on variable-rate debt would impact the results of operations by approximately **$2.8 million** per year[225](index=225&type=chunk) - The company may use hedging arrangements to manage interest rate and currency fluctuations, though no specific arrangements are detailed for the current period[224](index=224&type=chunk) [ITEM 4. CONTROLS AND PROCEDURES](index=49&type=section&id=ITEM%204.%20CONTROLS%20AND%20PROCEDURES) This section confirms the effectiveness of the company's disclosure controls and procedures as of March 31, 2025, and states that there have been no material changes in internal controls over financial reporting during the most recent fiscal quarter - The Chief Executive Officer and Chief Financial Officer concluded that the company's disclosure controls and procedures were effective as of March 31, 2025[227](index=227&type=chunk) - Disclosure controls ensure that information required for SEC reports is recorded, processed, summarized, and reported timely, and communicated to management for decision-making[227](index=227&type=chunk) - No material changes in internal controls over financial reporting occurred during the most recent fiscal quarter[229](index=229&type=chunk) PART II. OTHER INFORMATION This section provides additional disclosures on legal matters, equity sales, defaults, and other miscellaneous information [ITEM 1. LEGAL PROCEEDINGS](index=50&type=section&id=ITEM%201.%20LEGAL%20PROCEEDINGS) This section details ongoing legal proceedings, including class action lawsuits, and the company's accrued liabilities - A class action lawsuit filed in December 2016 against a hotel management company, affecting two of the company's hotels, has reached a tentative settlement, with the estimated liability accrued as of March 31, 2025[231](index=231&type=chunk) - A lawsuit against Hilton entities, including Hilton La Jolla Torrey Pines, for wage and hour violations, resulted in a mediator's proposal of approximately **$3.5 million**, with **$401,000** allocated and accrued for Hilton La Jolla Torrey Pines as of March 31, 2025[232](index=232&type=chunk) - A class action lawsuit related to a September 2023 cyber incident has a tentative settlement of approximately **$485,000**, with final court approval scheduled for August 27, 2025[235](index=235&type=chunk) [ITEM 1A. RISK FACTORS](index=51&type=section&id=ITEM%201A.%20RISK%20FACTORS) This section refers to the risk factors in the 2024 Annual Report on Form 10-K, noting no material changes as of Q1 2025 - The discussion of business and operations should be read in conjunction with the risk factors outlined in Item 1A of the 2024 Annual Report on Form 10-K[237](index=237&type=chunk) - As of March 31, 2025, there have been no material changes to the risk factors previously disclosed in the Annual Report on Form 10-K[237](index=237&type=chunk) [ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS](index=51&type=section&id=ITEM%202.%20UNREGISTERED%20SALES%20OF%20EQUITY%20SECURITIES%20AND%20USE%20OF%20PROCEEDS) This section details the company's share repurchase program and equity security purchases during Q1 2025 - A new share repurchase program for up to **$50 million** was approved on May 3, 2024, but no common stock has been repurchased under this plan as of March 31, 2025[238](index=238&type=chunk) Purchases of Equity Securities by the Issuer (Q1 2025) | Period | Total Number of Shares Purchased | Average Price Paid Per Share | | :------------------- | :----------------------------- | :--------------------------- | | January 1 - January 31 | — | $— | | February 1 - February 28 | 19,755 | $2.59 | | March 1 - March 31 | — | $— | | **Total** | **19,755** | **$2.59** | - The **19,755 shares** purchased in February were withheld to cover tax-withholding requirements related to the vesting of performance stock units[239](index=239&type=chunk) [ITEM 3. DEFAULTS UPON SENIOR SECURITIES](index=51&type=section&id=ITEM%203.%20DEFAULTS%20UPON%20SENIOR%20SECURITIES) This section states that there were no defaults upon senior securities during the reporting period - There were no defaults upon senior securities[240](index=240&type=chunk) [ITEM 4. MINE SAFETY DISCLOSURES](index=51&type=section&id=ITEM%204.%20MINE%20SAFETY%20DISCLOSURES) This section indicates that mine safety disclosures are not applicable to the company's operations - Mine safety disclosures are not applicable[241](index=241&type=chunk) [ITEM 5. OTHER INFORMATION](index=51&type=section&id=ITEM%205.%20OTHER%20INFORMATION) This section provides information regarding Rule 10b5-1 Trading Agreements, stating that no director or officer adopted or terminated such agreements during the first quarter of 2025 - No director or officer of the company adopted or terminated a "Rule 10b5-1 trading agreement" or "non-Rule 10b5-1 trading agreement" during the three months ended March 31, 2025[242](index=242&type=chunk) [ITEM 6. EXHIBITS](index=52&type=section&id=ITEM%206.%20EXHIBITS) This section lists all exhibits filed as part of the Form 10-Q, including various corporate documents and certifications - The exhibits include Articles of Amendment and Restatement, Articles Supplementary, Fifth Amended and Restated Bylaws, and a Limited Waiver Under Advisory Agreement[246](index=246&type=chunk) - Certifications of the Chief Executive Officer and Chief Financial Officer are filed herewith, including those pursuant to Rule 13a-14(a) and 18 U.S.C. Section 1350[246](index=246&type=chunk) - Financial statements and notes are formatted in XBRL (Extensible Business Reporting Language) and submitted electronically[245](index=245&type=chunk) SIGNATURES This section contains the signatures of the registrant's authorized officers, confirming the submission of the report - The report is duly signed on behalf of Braemar Hotels & Resorts Inc. by Richard J. Stockton, President and Chief Executive Officer, and Deric S. Eubanks, Chief Financial Officer, on May 8, 2025[248](index=248&type=chunk)[249](index=249&type=chunk)[250](index=250&type=chunk)

Financial Data and Key Metrics Changes - The company reported a net loss attributable to common stockholders of $2.5 million or $0.04 per diluted share for the quarter [14] - Adjusted EBITDAre for the quarter was $63 million, with total assets at $2.1 billion and total loans of $1.2 billion [14][15] - The company achieved a comparable RevPAR of $400, reflecting a 4.2% increase year-over-year, marking the highest quarterly RevPAR in its history [8][9] Business Line Data and Key Metrics Changes - Comparable total hotel revenue increased by 4.4% year-over-year, while comparable hotel EBITDA was $70.8 million, representing a 5.3% increase [9] - The resort portfolio reported a comparable RevPAR of $800, a 1.9% increase, and combined comparable hotel EBITDA of $62 million, a 2% increase [9] - Urban hotels delivered a comparable RevPAR growth of 11.3%, with the Capitol Hilton achieving a 19.3% year-over-year RevPAR growth due to the presidential inauguration [10] Market Data and Key Metrics Changes - Group revenue increased by 31% compared to the prior year period, indicating strong demand and effective sales strategies [21] - The urban assets delivered a 10% increase in comparable total revenue and a 39% increase in comparable hotel EBITDA [24] - Group room revenue pace for 2025 is up 7%, with continued growth expected at 10% for 2026 [11][24] Company Strategy and Development Direction - The company successfully addressed its final 2025 debt maturity, resulting in a lower cost of capital and improved maturity schedule [7][12] - The company is focused on strategic reinvestment and brand alignment, with planned capital expenditures between $75 million and $95 million for 2025 [30] - The company is exploring asset sales, particularly upper upscale assets, to enhance shareholder value and potentially fund preferred equity redemptions and share buybacks [55][56] Management's Comments on Operating Environment and Future Outlook - Management noted that economic uncertainty rhetoric has dissipated, and booking pace remains strong, positioning the portfolio to outperform [7] - The company remains optimistic about the opportunities ahead, highlighting the resilience of its diversified portfolio [30] - Management expressed confidence in continued EBITDA growth due to effective cost containment measures and productivity improvements [42] Other Important Information - The company redeemed approximately $90 million of its non-traded preferred stock, representing about 20% of the original capital raise [13] - The company announced a quarterly common stock dividend of $0.05 per share, equating to an annual yield of approximately 10.4% [15] Q&A Session Summary Question: Any trends or variability worth calling out outside of PACE in light of macroeconomic volatility? - Management indicated that the portfolio is well insulated from macro headwinds, with a slight shortening of the booking window but no significant impact on group performance [34][35] Question: How much inbound international exposure does the portfolio have? - The international inbound is a small part of the portfolio, with minimal impact observed, as some markets saw growth while others experienced slight declines [36][38] Question: What is the opportunity to grow margin in the near term? - Management is optimistic about margin growth, citing improved productivity and effective cost containment measures [39][42] Question: Can you provide additional color on the Magnificent Mile conversion? - The conversion is expected to enhance asset value and performance, with minimal CapEx planned for public and meeting space renovations [43][44] Question: How much can you buy back in preferred redemptions? - The company can redeem preferred stock after two years, with timing and sequencing being the limiting factors for repurchases [50][52] Question: What is the update on asset sales and expected proceeds utilization? - Management noted increased buyer activity and plans to utilize proceeds for preferred equity redemptions, share buybacks, and retiring corporate convertible notes [56]

Financial Data and Key Metrics Changes - The company reported a comparable RevPAR of $400, reflecting a 4.2% increase year-over-year, marking the highest quarterly RevPAR in its history [7][8] - Comparable total hotel revenue increased by 4.4% year-over-year, while comparable hotel EBITDA was $70.8 million, representing a 5.3% increase [8][14] - The net loss attributable to common stockholders was $2.5 million, or $0.04 per diluted share, with AFFO per diluted share of $0.40 [14][15] Business Line Data and Key Metrics Changes - The resort portfolio reported a comparable RevPAR of $800, a 1.9% increase year-over-year, with combined comparable hotel EBITDA of $62 million, a 2% increase [9][10] - Urban hotels achieved a comparable RevPAR growth of 11.3%, with the Capitol Hilton benefiting from the presidential inauguration, showing a 19.3% year-over-year RevPAR growth [10][11] Market Data and Key Metrics Changes - The group revenue pace for 2025 is up 7%, with continued growth projected at 10% for 2026 [11][24] - The urban portfolio's comparable total revenue increased by 10%, and comparable hotel EBITDA increased by 39% year-over-year [24] Company Strategy and Development Direction - The company successfully extended its mortgage loan secured by the Ritz Carlton Lake Tahoe, improving its maturity schedule and lowering the cost of capital [11][12] - The company is focused on strategic capital expenditures, anticipating spending between $75 million and $95 million in 2025 to enhance portfolio quality and brand alignment [29][28] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the portfolio's resilience amid economic uncertainty, noting strong booking trends and a solid balance sheet [7][30] - The company highlighted the effectiveness of its cost control initiatives, resulting in improved hotel EBITDA margins [20][40] Other Important Information - The company redeemed approximately $90 million of its non-traded preferred stock, representing about 20% of the original capital raise [13] - The company is exploring asset sales, with increased buyer activity noted in the marketplace, particularly for upper upscale assets [52][53] Q&A Session Summary Question: Any trends in group bookings regarding cancellations or macroeconomic volatility? - Management noted that while the booking window is shortening slightly, there is no significant impact on group bookings, with Q1 group revenue up 31% year-over-year [32][33] Question: What is the company's exposure to international inbound business? - The company indicated that international inbound is a small part of the portfolio, with minimal impact observed, varying by market [34][36] Question: How does the company plan to grow EBITDA margins? - Management expressed optimism about margin growth, citing aggressive cost containment measures and productivity improvements [37][40] Question: Can you provide details on the Magnificent Mile conversion? - The conversion is expected to enhance asset value and performance, with minimal CapEx planned for public and meeting space renovations [41][42] Question: What is the status of preferred stock redemptions? - The company explained that redemptions are subject to timing and the structure of the security, with holders able to redeem after three years [46][49] Question: What is the outlook for asset sales and use of proceeds? - Management reported increased buyer activity and plans to utilize proceeds for preferred equity redemptions, share buybacks, and retiring corporate convertible notes [52][54]

Core Insights - Braemar Hotels & Resorts reported quarterly funds from operations (FFO) of $0.40 per share, exceeding the Zacks Consensus Estimate of $0.34 per share, but down from $0.42 per share a year ago, representing a 17.65% surprise [1] - The company posted revenues of $215.82 million for the quarter ended March 2025, surpassing the Zacks Consensus Estimate by 7.96%, although this is a decrease from $219.08 million year-over-year [2] - The stock has underperformed, losing approximately 35.3% since the beginning of the year compared to the S&P 500's decline of 4.7% [3] Financial Performance - Over the last four quarters, Braemar Hotels & Resorts has surpassed consensus FFO estimates only once [2] - The current consensus FFO estimate for the upcoming quarter is $0.07 on revenues of $166.8 million, and for the current fiscal year, it is $0.29 on revenues of $681.8 million [7] Market Outlook - The estimate revisions trend for Braemar Hotels & Resorts is currently unfavorable, resulting in a Zacks Rank 4 (Sell), indicating expected underperformance in the near future [6] - The REIT and Equity Trust - Other industry is ranked in the bottom 37% of over 250 Zacks industries, suggesting that the outlook for the industry could significantly impact the stock's performance [8]

[First Quarter 2025 Results](index=1&type=section&id=First%20Quarter%202025%20Results) Braemar Hotels & Resorts reported its Q1 2025 results, highlighting RevPAR growth, strategic capital management, and operational transitions, alongside a declared dividend [First Quarter 2025 Financial and Operating Highlights](index=1&type=section&id=FIRST%20QUARTER%202025%20FINANCIAL%20HIGHLIGHTS) In the first quarter of 2025, Braemar Hotels & Resorts reported a 4.2% increase in Comparable RevPAR to $404, driven by a 4.5% rise in ADR, despite a slight 0.3% dip in occupancy. The company posted a net loss of $(2.5) million, or $(0.04) per share, while Adjusted FFO was $0.40 per share. Key operational activities included extending a mortgage loan for the Ritz-Carlton Lake Tahoe and redeeming $26.2 million of non-traded preferred stock Q1 2025 Key Financial Metrics (in millions, except per share and percentage data) | Metric | Value | Change (YoY) | | :--- | :--- | :--- | | Comparable RevPAR | $404 | ▲ 4.2% | | Comparable ADR | $626 | ▲ 4.5% | | Comparable Occupancy | 64.6% | ▼ 0.3% | | Net Loss (to common stockholders) | $(2.5) million | - | | Net Loss per Diluted Share | $(0.04) | - | | Adjusted FFO per Diluted Share | $0.40 | - | | Adjusted EBITDAre | $63.0 million | - | | Comparable Hotel EBITDA | $70.8 million | ▲ 5.3% | - The company ended the quarter with **$81.7 million** in cash and cash equivalents and **$54.5 million** in restricted cash[5](index=5&type=chunk) - During the quarter, the company extended its mortgage loan for the 170-room Ritz-Carlton Lake Tahoe[4](index=4&type=chunk) - Approximately **$26.2 million** of non-traded preferred stock was redeemed in cash during the quarter[5](index=5&type=chunk) [Operational Updates](index=2&type=section&id=SOFITEL%20CHICAGO%20MAGNIFICENT%20MILE) The company transitioned the 415-room Sofitel Chicago Magnificent Mile to a franchise structure in May 2025. Under this new arrangement, the hotel will continue to operate under the Sofitel brand but will be managed by Remington Hospitality. This move does not require an immediate property improvement plan, though renovations to the lobby, restaurant, and meeting spaces are planned over the next two years - The Sofitel Chicago Magnificent Mile was converted to a franchise structure, managed by Remington Hospitality, effective early May 2025[6](index=6&type=chunk) - The conversion is expected to increase the property's value as the management agreement with Remington is terminable on sale[13](index=13&type=chunk) [Capital Structure and Debt Management](index=2&type=section&id=CAPITAL%20STRUCTURE) As of March 31, 2025, Braemar had total assets of $2.1 billion and $1.2 billion in loans with a blended average interest rate of 7.1%. Approximately 77% of the debt is effectively floating. The company successfully extended the mortgage for the Ritz-Carlton Lake Tahoe and refinanced loans for five hotels, totaling $363 million, which addressed its final 2025 debt maturity and lowered interest costs - Total assets were **$2.1 billion** and total loans were **$1.2 billion** as of March 31, 2025[7](index=7&type=chunk) - The blended average interest rate on total loans is **7.1%**, with **23%** of debt effectively fixed and **77%** effectively floating[7](index=7&type=chunk) - A **$363 million** refinancing was completed for five hotels, addressing the final 2025 debt maturity. The new loan has a floating rate of SOFR + 2.52%[9](index=9&type=chunk) - The mortgage loan for the Ritz-Carlton Lake Tahoe was extended with a **$10 million** paydown, and the new spread is SOFR + 3.25%[8](index=8&type=chunk) [Dividends](index=2&type=section&id=DIVIDENDS) The Board of Directors declared a quarterly cash dividend of $0.05 per common share for the second quarter of 2025. This dividend, equating to an annual rate of $0.20 per share, is payable on July 15, 2025, to stockholders of record as of June 30, 2025. The dividend policy will be reviewed quarterly - A quarterly cash dividend of **$0.05 per share** was declared for Q2 2025[10](index=10&type=chunk) - The dividend will be paid on July 15, 2025, to stockholders of record as of June 30, 2025[10](index=10&type=chunk) [Management Commentary](index=3&type=section&id=Management%20Commentary) CEO Richard J. Stockton expressed satisfaction with the solid Q1 performance, highlighting the 4.2% RevPAR growth as an important inflection point. He noted strong performance in the urban portfolio, with 11.3% RevPAR growth, boosted by the presidential inauguration, while the resort portfolio saw nearly 2% RevPAR growth. Stockton emphasized progress on the shareholder value creation plan, including the redemption of approximately $90 million in non-traded preferred stock and the value-enhancing conversion of the Sofitel Chicago - CEO highlighted the **4.2% RevPAR growth** as the second consecutive quarter of growth, signaling an 'important inflection point'[13](index=13&type=chunk) - The urban hotel portfolio delivered **11.3% RevPAR growth**, benefiting from the presidential inauguration in Washington, D.C.[13](index=13&type=chunk) - Resort properties continued their recovery with nearly **2% RevPAR growth**[13](index=13&type=chunk) [Consolidated Financial Statements](index=5&type=section&id=BRAEMAR%20HOTELS%20%26%20RESORTS%20INC.%20AND%20SUBSIDIARIES%20CONSOLIDATED%20FINANCIAL%20STATEMENTS) This section presents Braemar Hotels & Resorts' consolidated financial statements, including balance sheets and statements of operations, detailing asset, liability, equity, revenue, and expense figures for the reported periods [Consolidated Balance Sheets](index=5&type=section&id=CONSOLIDATED%20BALANCE%20SHEETS) As of March 31, 2025, Braemar's total assets stood at $2.10 billion, a slight decrease from $2.14 billion at year-end 2024. Total liabilities also decreased marginally to $1.40 billion from $1.41 billion. Cash and cash equivalents decreased to $81.7 million from $135.5 million over the same period Consolidated Balance Sheet Highlights (in thousands) | Account | March 31, 2025 | December 31, 2024 | | :--- | :--- | :--- | | **Total Assets** | **$2,098,029** | **$2,136,059** | | Cash and cash equivalents | $81,689 | $135,465 | | Investments in hotel properties, net | $1,769,945 | $1,778,686 | | **Total Liabilities** | **$1,402,332** | **$1,413,889** | | Indebtedness, net | $1,202,668 | $1,210,018 | | **Total Equity** | **$235,477** | **$237,362** | [Consolidated Statements of Operations](index=6&type=section&id=CONSOLIDATED%20STATEMENTS%20OF%20OPERATIONS) For the first quarter of 2025, total hotel revenue was $215.8 million, down from $219.1 million in Q1 2024. Operating income decreased to $36.7 million from $42.5 million year-over-year. The company reported a net loss attributable to common stockholders of $(2.5) million, or $(0.04) per share, compared to a net income of $3.5 million, or $0.05 per share, in the prior-year quarter Q1 Statement of Operations Highlights (in thousands, except per share data) | Account | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Total hotel revenue | $215,820 | $219,079 | | Total operating expenses | $179,080 | $176,612 | | Operating Income | $36,740 | $42,467 | | Net Income (Loss) | $10,672 | $15,482 | | **Net (Loss) Income to Common Stockholders** | **$(2,547)** | **$3,524** | | **(Loss) Income Per Share - Diluted** | **$(0.04)** | **$0.05** | [Non-GAAP Financial Measures and Reconciliations](index=7&type=section&id=Non-GAAP%20Financial%20Measures%20and%20Reconciliations) This section provides reconciliations of the company's non-GAAP financial measures, including EBITDA, EBITDAre, Adjusted EBITDAre, FFO, and Adjusted FFO, to their most directly comparable GAAP measures [Reconciliation to EBITDA, EBITDAre, and Adjusted EBITDAre](index=7&type=section&id=RECONCILIATION%20OF%20NET%20INCOME%20%28LOSS%29%20TO%20EBITDA%2C%20EBITDAre%20AND%20ADJUSTED%20EBITDAre) In Q1 2025, the company's Adjusted EBITDAre was $63.0 million, a decrease from $66.2 million in Q1 2024. The reconciliation from net income of $10.7 million includes adjustments for interest, depreciation, taxes, and other items such as transaction costs and unrealized losses on derivatives EBITDAre Reconciliation (in thousands) | Metric | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Net income (loss) | $10,672 | $15,482 | | EBITDAre | $60,361 | $68,837 | | **Adjusted EBITDAre** | **$63,003** | **$66,192** | [Reconciliation to FFO and Adjusted FFO](index=7&type=section&id=RECONCILIATION%20OF%20NET%20INCOME%20%28LOSS%29%20TO%20FUNDS%20FROM%20OPERATIONS%20%28FFO%29%20AND%20ADJUSTED%20FFO) For Q1 2025, Adjusted Funds From Operations (AFFO) available to common stockholders was $29.1 million, or $0.40 per diluted share. This is a slight decrease from $30.3 million, or $0.42 per diluted share, in the same period last year. The calculation starts with net income and adjusts for non-cash items like depreciation and other specific charges FFO and Adjusted FFO (in thousands, except per share data) | Metric | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Net income (loss) attributable to common stockholders | $(2,547) | $3,524 | | FFO available to common stockholders | $19,867 | $27,982 | | **Adjusted FFO available to common stockholders** | **$29,114** | **$30,260** | | **Adjusted FFO per diluted share** | **$0.40** | **$0.42** | [Debt and Capital Structure Details](index=8&type=section&id=Debt%20and%20Capital%20Structure%20Details) This section details the company's debt profile, including its composition by rate type, maturity schedule, and the calculation of its total enterprise value [Summary of Indebtedness](index=8&type=section&id=SUMMARY%20OF%20INDEBTEDNESS) As of March 31, 2025, Braemar's total debt was approximately $1.22 billion. The majority of the debt (92.9%) is floating-rate, with a weighted average interest rate of 7.27%, while 7.1% is fixed-rate at 4.50%. The overall weighted average interest rate, adjusted for caps, is 7.07% Indebtedness Summary (as of March 31, 2025, in thousands) | Debt Type | Amount (in thousands) | Percentage | Weighted Avg. Interest Rate | | :--- | :--- | :--- | :--- | | Fixed-Rate Debt | $86,250 | 7.1% | 4.50% | | Floating-Rate Debt | $1,134,513 | 92.9% | 7.27% | | **Total Debt** | **$1,220,763** | **100.0%** | **7.07%** | [Indebtedness by Maturity](index=9&type=section&id=INDEBTEDNESS%20BY%20MATURITY%20ASSUMING%20EXTENSION%20OPTIONS%20ARE%20EXERCISED) Assuming all extension options are exercised, the company has no debt maturing in 2025. Maturities are scheduled for 2026 ($129.7 million), 2027 ($74.5 million), 2028 ($246.6 million), 2029 ($407.0 million), and thereafter ($363.0 million) Debt Maturity Schedule (in thousands) | Maturity Year | Principal Due | | :--- | :--- | | 2025 | $0 | | 2026 | $129,663 | | 2027 | $74,500 | | 2028 | $246,600 | | 2029 | $407,000 | | Thereafter | $363,000 | | **Total** | **$1,220,763** | [Total Enterprise Value](index=25&type=section&id=TOTAL%20ENTERPRISE%20VALUE) As of March 31, 2025, Braemar's Total Enterprise Value (TEV) was calculated at approximately $1.78 billion. This value is derived from its market capitalization of $184.1 million, preferred stock, total indebtedness, and net working capital Total Enterprise Value Calculation (in thousands) | Component | Value | | :--- | :--- | | Market capitalization | $184,076 | | Preferred stock (All Series) | $501,167 | | Indebtedness | $1,220,763 | | Joint venture partner's share of debt | $(27,650) | | Net working capital | $(99,530) | | **Total Enterprise Value (TEV)** | **$1,778,826** | [Hotel Portfolio Performance](index=10&type=section&id=Hotel%20Portfolio%20Performance) This section analyzes the performance of the company's hotel portfolio, detailing key performance indicators, EBITDA, and performance segmented by property type and trailing twelve months [Key Performance Indicators (KPIs)](index=10&type=section&id=KEY%20PERFORMANCE%20INDICATORS) For the first quarter of 2025, the company's entire portfolio of 15 hotels achieved a comparable RevPAR of $404, a 4.2% increase year-over-year. This was driven by a 4.5% increase in ADR to $626, while occupancy saw a minor decrease of 0.3% to 64.6%. Hotels not under renovation showed slightly stronger performance with a 4.5% RevPAR increase Comparable KPIs for All Hotels (Q1 2025 vs Q1 2024) | Metric | Q1 2025 | Q1 2024 | % Variance | | :--- | :--- | :--- | :--- | | RevPAR | $403.99 | $387.90 | 4.15% | | Occupancy | 64.58% | 64.80% | (0.34)% | | ADR | $625.59 | $598.60 | 4.51% | - The 13 hotels not under renovation during the quarter reported a comparable RevPAR increase of **4.49%** year-over-year[41](index=41&type=chunk) [Hotel Net Income & EBITDA](index=11&type=section&id=HOTEL%20NET%20INCOME%20%26%20EBITDA) In Q1 2025, comparable Hotel EBITDA for all properties increased by 5.3% to $70.8 million compared to the prior year. The comparable Hotel EBITDA margin improved slightly to 32.42%. For hotels not under renovation, the comparable Hotel EBITDA grew by 6.0% to $71.2 million, with a margin of 32.92% Comparable Hotel EBITDA for All Hotels (Q1 2025 vs Q1 2024, in thousands) | Metric | Q1 2025 | Q1 2024 | % Variance | | :--- | :--- | :--- | :--- | | Comparable total hotel revenue | $218,409 | $209,698 | 4.15% | | **Comparable hotel EBITDA** | **$70,799** | **$67,208** | **5.34%** | | Comparable hotel EBITDA margin | 32.42% | 32.05% | 0.37% | [Performance by Property Type (Resort vs. Urban)](index=13&type=section&id=SELECTED%20FINANCIAL%20AND%20OPERATING%20INFORMATION%20BY%20PROPERTY) In Q1 2025, the Urban properties portfolio significantly outperformed the Resort portfolio in terms of growth. Urban properties saw a 38.9% increase in Hotel EBITDA and an 11.3% increase in RevPAR. In contrast, Resort properties had a more modest 2.0% increase in Hotel EBITDA and a 1.9% increase in RevPAR Comparable Performance by Property Type (Q1 2025 vs Q1 2024, in thousands, except RevPAR) | Property Type | Metric | Q1 2025 | % Variance (YoY) | | :--- | :--- | :--- | :--- | | **Resort Properties** | RevPAR | $800.22 | ▲ 1.92% | | | Hotel EBITDA | $62,392K | ▲ 2.02% | | **Urban Properties** | RevPAR | $166.59 | ▲ 11.25% | | | Hotel EBITDA | $8,407K | ▲ 38.94% | [Trailing Twelve Months (TTM) Performance](index=18&type=section&id=TTM%20Performance) For the trailing twelve months ending March 31, 2025, the company's comparable portfolio generated $715.0 million in total revenue and $182.6 million in Hotel EBITDA, resulting in a Hotel EBITDA margin of 25.54%. The comparable RevPAR for the period was $320.53 Comparable TTM Performance (ended March 31, 2025, in thousands, except RevPAR) | Metric | Value (in thousands, except RevPAR) | | :--- | :--- | | Total hotel revenue | $715,027 | | Hotel net income | $33,388 | | **Hotel EBITDA** | **$182,624** | | Hotel EBITDA margin | 25.54% | | RevPAR | $320.53 | [Other Disclosures](index=26&type=section&id=Other%20Disclosures) This section outlines anticipated capital expenditures for various properties, which may lead to operational displacement [Anticipated Capital Expenditures](index=26&type=section&id=ANTICIPATED%20CAPITAL%20EXPENDITURES%20CALENDAR%20%28a%29) The company has planned significant capital expenditures for 2025 that may cause displacement at several properties. Projects are scheduled for Hotel Yountville throughout the year, Park Hyatt Beaver Creek from Q2 to Q4, and Cameo Beverly Hills in Q3 and Q4 - Significant capital expenditures are planned for 2025 at Hotel Yountville, Park Hyatt Beaver Creek, and Cameo Beverly Hills, which could lead to displacement[75](index=75&type=chunk)

Core Viewpoint - The focus is on building a financial portfolio aimed at achieving financial independence through investments in dividend stocks, which provide a steady income stream. Group 1: Financial Strategy - The strategy emphasizes the importance of dividend stocks for generating consistent income to support the goal of financial independence [1]

DALLAS, April 10, 2025 /PRNewswire/ -- Braemar Hotels & Resorts Inc. (NYSE: BHR) ("Braemar" or the "Company") announced today that its Board of Directors (the "Board") declared a quarterly cash dividend of $0.05 per diluted share for the Company's common stock for the second quarter ending June 30, 2025. This dividend, which equates to an annual rate of $0.20 per share, is payable on July 15, 2025, to stockholders of record as of June 30, 2025.The Board declared a quarterly cash dividend for the second quar ...