Core Insights - Summit Hotel Properties, Inc. has published its annual Corporate Responsibility Report, emphasizing its commitment to long-term shareholder value through responsible investment, environmental protection, and community support [1] - The CEO highlighted significant progress in the company's Corporate Responsibility and Sustainability program, reflecting a commitment to sustainable hotel operations and strong governance [1] - The report aims to enhance stakeholder understanding of the company's commitments to environmental stewardship, social responsibility, and governance [1] Company Overview - Summit Hotel Properties, Inc. is a publicly traded real estate investment trust focused on premium-branded lodging facilities, primarily in the upscale segment [2] - As of November 11, 2025, the company owns 95 assets, with 52 wholly owned, totaling 14,347 guestrooms across 24 states [2]

Financial Data and Key Metrics Changes - The third quarter same-store RevPAR declined by 3.7% year over year, primarily driven by a 3.4% decline in average daily rate, while occupancy remained flat year over year [4][15][25] - Adjusted EBITDA for the third quarter was $39.3 million, and adjusted FFO was $21.3 million, or $0.17 per share, benefiting from lower interest expenses and a reduced share count due to share repurchases [15][25] - Operating expenses increased only 1.8% year over year, or approximately 2% on a per-occupied room basis, which helped mitigate EBITDA losses [8][19][21] Business Line Data and Key Metrics Changes - Non-rooms revenue increased by 5.6% in the third quarter, driven by food and beverage sales, resort and amenity fees, and parking charges [7][18] - The company experienced a significant decline in government and international inbound travel, which collectively accounted for approximately 15% of occupied room nights and drove nearly 50% of the year-over-year RevPAR decline [5][12] Market Data and Key Metrics Changes - Chicago, San Francisco, and Orlando generated positive RevPAR growth in the third quarter, with Chicago seeing an 8% ADR growth due to a solid convention calendar [16][17] - Nashville hotels delivered a strong third quarter with RevPAR increasing by over 6% on an 11% increase in ADR, significantly outperforming the overall market [18] Company Strategy and Development Direction - The company completed the sale of two non-core hotels, generating $39 million in gross proceeds, as part of a capital recycling strategy to enhance portfolio quality and reduce leverage [9][10] - The company expects to benefit from the 2026 World Cup, with exposure to six host markets, which will create robust demand [13][29] Management's Comments on Operating Environment and Future Outlook - Management noted that while there has been softness in leisure demand, trends appear to have stabilized, particularly with improved midweek performance in urban markets [28] - The outlook for the fourth quarter incorporates sequential improvement in operating trends, with expectations of RevPAR growth declining between 2% and 2.5% year over year [12][25] Other Important Information - The company declared a quarterly common dividend of $0.08 per share, representing a yield of approximately 6% [25] - The company has invested over $260 million in capital expenditures over the past three years to maintain a best-in-class portfolio [22] Q&A Session Summary Question: What are the leisure demand trends across the portfolio? - Management indicated that leisure demand has stabilized, with better midweek performance contributing to a more constructive outlook for the fourth quarter [28] Question: Which markets are most optimistic for next year? - Management highlighted the World Cup as a significant driver of demand, with exposure to six markets expected to benefit from special events [29] Question: Can you provide insights on government demand and its impact? - Government demand has been down approximately 30% year over year in October, contributing to overall softness, but better midweek trends have offset some of this decline [44]

Financial Performance - Net loss attributable to common stockholders was $(11301) thousand for the three months ended September 30, 2025, compared to $(4272) thousand in 2024[13] - Net loss per diluted share was $(011) for the three months ended September 30, 2025, compared to $(004) in 2024[13] - Total revenues were $177117 thousand for the three months ended September 30, 2025, slightly up from $176807 thousand in 2024[13] - Adjusted EBITDAre decreased to $39263 thousand for the three months ended September 30, 2025, from $45340 thousand in 2024[13] - Adjusted FFO was $21253 thousand for the three months ended September 30, 2025, compared to $27610 thousand in 2024[13] Pro Forma Operating Results - Pro forma total revenues for the three months ended September 30, 2025, were $177117 thousand, compared to $182537 thousand in 2024[30] - Pro forma hotel EBITDA was $54118 thousand for the three months ended September 30, 2025, down from $62180 thousand in 2024[30] - Pro forma hotel EBITDA margin decreased to 306% for the three months ended September 30, 2025, from 341% in 2024[30] - RevPAR decreased by (42)% for the three months ended September 30, 2025[13] Capitalization - Market value of common equity at quarter end was $668748 thousand as of September 30, 2025[35] - Consolidated total debt was $1433483 thousand as of September 30, 2025[35]

Core Insights - Summit Hotel Properties (INN) reported quarterly funds from operations (FFO) of $0.17 per share, exceeding the Zacks Consensus Estimate of $0.14 per share, but down from $0.22 per share a year ago [1][2] - The company achieved an FFO surprise of +21.43% for the quarter, having surpassed consensus FFO estimates in all four of the last quarters [2] - Revenues for the quarter were $177.12 million, slightly missing the Zacks Consensus Estimate by 0.69%, and showing a marginal increase from $176.81 million year-over-year [3] Financial Performance - The FFO for the previous quarter was $0.27 per share, compared to an expectation of $0.26 per share, resulting in a surprise of +3.85% [2] - The current consensus FFO estimate for the upcoming quarter is $0.19, with projected revenues of $177.93 million, and for the current fiscal year, the estimate is $0.77 on revenues of $734.55 million [8] Market Position - Summit Hotel Properties has underperformed the market, with shares down approximately 23.8% year-to-date, while the S&P 500 has gained 16.5% [4] - The Zacks Industry Rank places the REIT and Equity Trust - Other sector in the top 35% of over 250 Zacks industries, indicating a favorable industry outlook [9] Future Outlook - The sustainability of the stock's price movement will largely depend on management's commentary during the earnings call [4] - The estimate revisions trend for Summit Hotel Properties was mixed prior to the earnings release, resulting in a Zacks Rank 3 (Hold) for the stock, suggesting it is expected to perform in line with the market [7]

Core Insights - The company reported a net loss of $11.3 million for Q3 2025, compared to a loss of $4.3 million in Q3 2024, reflecting ongoing challenges in the hospitality sector [6][7][30] - The company completed the sale of two hotels for $39 million, achieving a blended capitalization rate of 4.3%, as part of its capital recycling strategy [3][11][12] - The company expects a sequential improvement in operating trends for Q4 2025, despite a challenging environment characterized by reduced government demand and slower international travel [2][19] Financial Performance - Total revenues for Q3 2025 were $177.1 million, slightly up from $176.8 million in Q3 2024 [8][30] - Same store RevPAR decreased by 3.7% to $115.77 in Q3 2025 compared to Q3 2024, while pro forma RevPAR decreased by 4.2% to $116.57 [7][8] - Adjusted EBITDAre for Q3 2025 was $39.3 million, down from $45.3 million in Q3 2024 [8][30] Balance Sheet and Capital Management - The company refinanced a $400 million term loan at a lower interest rate, enhancing its balance sheet and extending debt maturities until 2030 [3][15][19] - As of September 30, 2025, the company had total outstanding debt of $1.1 billion with a weighted average interest rate of 4.52% [25] - The company declared a quarterly cash dividend of $0.08 per share, representing an annualized yield of 6.1% [17][18] Market Outlook - The company anticipates Q4 2025 RevPAR growth to range from -2.0% to -2.5%, reflecting ongoing price sensitivity and macroeconomic volatility [19] - The long-term outlook remains positive due to a lack of new supply growth in the industry [2][19]

Company Overview - As of September 30, 2025, the company owned 97 lodging properties with a total of 14,577 guestrooms located in 25 states[179]. - The lodging property portfolio includes 49 properties under the Marriott brand, totaling 7,543 guestrooms, and 25 properties under the Hilton brand, totaling 3,887 guestrooms[187]. - The company operates under premium franchise brands including Marriott, Hilton, Hyatt, and IHG, with all properties managed by third-party companies[181]. - The company holds a 51% controlling interest in 41 lodging properties through a joint venture formed in July 2019[179]. - As of September 30, 2025, the company owned 100% of the outstanding equity interests in 53 of the 97 lodging properties[179]. Financial Performance - Total revenues for the three months ended September 30, 2025, were $177.1 million, a slight increase of 0.2% compared to $171.4 million in the same period of 2024[192]. - Room revenues decreased by $1.1 million, primarily due to a $5.6 million decrease in same-store revenues, offset by a $4.5 million increase from the acquisition of two properties[193]. - Total operating expenses increased by $4.8 million to $105.8 million, representing a 4.8% increase compared to $102.6 million in 2024[192]. - For the three months ended September 30, 2025, the net loss applicable to common shares was $12.8 million, compared to a net loss of $4.9 million for the same period in 2024[211]. - Funds From Operations (FFO) applicable to common shares and Common Units for the three months ended September 30, 2025, was $16.3 million, down from $23.1 million in 2024, representing a decrease of 29.9%[211]. - Adjusted Funds From Operations (AFFO) applicable to common shares and Common Units decreased by $6.4 million for the three months ended September 30, 2025, compared to the same period in 2024[214]. - The company recorded a loss on disposal of assets of $136, compared to a gain of $28.4 million in the prior year[204]. Revenue and Expenses - Key drivers of lodging revenue include changes in GDP, corporate profits, and consumer sentiment, with elevated inflation impacting operational costs[185]. - The company experienced a modest same-store revenue decline due to reduced government-related and inbound international travel, influenced by macroeconomic uncertainties[186]. - Occupancy rate remained stable at 73.7%, while Average Daily Rate (ADR) decreased by 2.9% to $158.25, leading to a 2.9% decrease in Revenue per Available Room (RevPAR) to $116.57[192]. - Room expenses increased by $1.7 million, driven by an $0.8 million increase in same-store room expenses due to higher labor and benefits costs[195]. - Property taxes, insurance, and other expenses increased by $0.9 million, primarily due to higher property tax expenses and a decrease in franchise tax refunds[197]. - Management fees rose by $0.4 million, reflecting amendments to property management agreements that resulted in lower fees in the prior year[197]. Capital Expenditures and Investments - Capital expenditures for the nine months ended September 30, 2025, were $56.4 million on a consolidated basis, with a pro rata portion of $48.7 million related to joint ventures[238]. - The company anticipates capital expenditures of approximately $60 million to $65 million on a pro rata basis during 2025[238]. - Cash used in investing activities for the nine months ended September 30, 2025, was $61.8 million, primarily due to $63.0 million of renovation and development expenditures[242]. Debt and Liquidity - As of September 30, 2025, the company had scheduled debt principal payments totaling $0.5 million in the next 12 months, alongside $287.5 million in convertible notes maturing in February 2026[224]. - The company closed a $275 million delayed draw term loan in March 2025 to refinance a significant portion of its convertible notes upon maturity[224]. - At September 30, 2025, total outstanding indebtedness was $1,433.5 million, which includes $20 million under a $400 million revolver and $200 million on a $200 million term loan[230]. - The company expects to maintain compliance with financial covenants and believes it will have adequate liquidity to meet scheduled maturities and principal repayments[225]. Share Repurchase and Tax Status - The company has authorized a share repurchase program of up to $50 million, with approximately $34.6 million remaining available for repurchase as of September 30, 2025[183][184]. - The company intends to distribute sufficient taxable income to maintain its REIT status, which requires distributing at least 90% of its REIT taxable income annually[228]. - Approximately $34.6 million is authorized for the repurchase of common stock under the 2025 Share Repurchase Program[229]. Interest Rates and Financial Instruments - At September 30, 2025, 69% of consolidated debt had fixed interest rates, while 31% had variable interest rates[246]. - An increase or decrease in interest rates of 1.0% would affect cash flows by approximately $4.5 million per year[247]. - The company entered into a $58 million interest rate swap in June 2025 to fix one-month term SOFR until May 2028[249]. - In August 2025, the GIC Joint Venture entered into two $150 million forward-starting interest rate swaps to fix one-month term SOFR until January 2028[250].

Core Points - Summit Hotel Properties, Inc. has declared a cash dividend of $0.08 per share for the third quarter ended September 30, 2025, representing an annualized dividend yield of 6.1% based on the closing price on October 30, 2025 [1] - The Board has also declared cash dividends for its preferred stock, including $0.390625 per share for the 6.25% Series E Cumulative Redeemable Preferred Stock and $0.3671875 per share for the 5.875% Series F Cumulative Redeemable Preferred Stock, both for the period ending November 30, 2025 [2] - Additionally, a cash distribution of $0.328125 per unit has been authorized for the operating partnership's unregistered 5.25% Series Z Cumulative Perpetual Preferred Units for the distribution period ending November 30, 2025 [3] Company Overview - Summit Hotel Properties, Inc. is a publicly-traded real estate investment trust focused on owning premium-branded lodging properties primarily in the Upscale segment of the lodging industry [4] - As of September 30, 2025, the company's portfolio consists of 97 assets, including 53 wholly owned properties, with a total of 14,577 guestrooms located across 25 states [4]

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Group 1 - The company, Summit Hotel Properties, Inc., will report its financial results for Q3 2025 on November 4, 2025, after market close [1] - A quarterly conference call is scheduled for November 5, 2025, at 9:00 AM ET [1][6] - As of September 23, 2025, the company's portfolio includes 97 assets, with 53 wholly owned properties and a total of 14,577 guestrooms across 25 states [2]

Core Points - Ashford Hospitality Trust has signed a definitive agreement to sell the Residence Inn San Diego Sorrento Mesa for $42.0 million, equating to $280,000 per room, with the sale expected to close in October 2025 [1][3] - The sale price reflects a capitalization rate of 5.7% on net operating income when adjusted for anticipated capital expenditures of $16.0 million, or a multiple of 15.3 times Hotel EBITDA for the twelve months ending July 31, 2025 [2] - Excluding anticipated capital expenditures, the sale price represents a 7.9% capitalization rate on net operating income or a multiple of 11.1 times Hotel EBITDA for the same period [2] - The transaction aligns with the company's strategy to deleverage its portfolio and enhance shareholder value, providing increased financial flexibility [3]