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Financial Data and Key Metrics Changes - The company reported distributable earnings of $0.44 per share, adjusted net income of $0.22 per share, and adjusted EBITDA of $20.5 million for Q4 2025, all in line with expectations [4][17] - Recurring service revenues were approximately $45.5 million, a sequential increase of about $1.5 million, driven by increases in enterprise values at DHC, ILPT, and SVC [17] - The company expects recurring service revenues to decrease to approximately $42.5 million in the next quarter due to lost fee revenue from the sale of a life science business [17] Business Line Data and Key Metrics Changes - DHC's consolidated shop NOI increased 8% year over year to $29.6 million, with a 210 basis point increase in occupancy to 81.5% and a 5.3% increase in average monthly rates [5] - SVC completed the sale of 40 hotels for over $292 million and is on pace to sell a total of 121 hotels in 2025 for $959 million [6] - Seven Hills delivered solid performance with a fully performing $642 million loan portfolio and announced a rights offering to raise approximately $65 million in new equity [7][8] Market Data and Key Metrics Changes - The company arranged almost 1.4 million square feet of leases in the past quarter, with rental rates approximately 14% higher than previous rents for the same space [11] - The company believes that 2026 will be a better year for institutional investments in real estate, as recent conversations with potential partners have reinforced commitments to the U.S. and many sectors [12] Company Strategy and Development Direction - The company is focused on helping SVC drive EBITDA growth across its hotel portfolio while managing ongoing revenue displacement from renovation activity [6] - The company is pursuing new growth initiatives in the private capital space to drive future revenue and earnings growth [10] - The company is actively sourcing investment opportunities in the retail sector, aiming to build a portfolio of value-add multi-tenant retail properties [15] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the strategic initiatives undertaken despite a continued unsettled economic environment [4] - The company anticipates a decline in adjusted EBITDA and distributable earnings per share in the next quarter primarily due to the sale of a life science business [20] - Management remains committed to supporting OPI during its restructuring process and believes the restructuring support agreement will strengthen OPI's financial position [9] Other Important Information - The company ended the quarter with $162 million of total liquidity, including $62 million in cash and $100 million of capacity on its undrawn revolving credit facility [20] - The company has agreed to backstop the rights offering for Seven Hills, demonstrating confidence in its business prospects [8] Q&A Session Summary Question: Does OPI's fee go up quarter to quarter? - The fee is effectively flat, with a fixed fee of $14 million per year for the first two years post-bankruptcy [26][27] Question: Where does shopping centers fit in the private capital strategy? - The company has core competency in retail and is looking to build a track record in investing in neighborhood and grocery-anchored shopping centers [29][30] Question: Any updates on the rights offering? - It is too early to tell how many shareholders will exercise their rights, but there is interest from new shareholders in buying rights from those who do not want to exercise [52] Question: What is the expected impact of the loss of managing AlerisLife? - A $1 million decrease in fee revenue is expected in the coming quarter, with an additional $400,000 reduction in fiscal Q2 [38] Question: How flexible is G&A spending if OPI's portfolio changes? - The company believes it could significantly reduce costs if it were not managing a large office portfolio, as office management is the most intensive [46]

Financial Performance - Net income attributable to The RMR Group Inc was $3414 thousand, or $020 per diluted share[18,22] - Adjusted Net Income Attributable to The RMR Group Inc was $3808 thousand, or $022 per diluted share[18,22] - Distributable Earnings was $14252 thousand, or $044 per diluted share[18,22] - Adjusted EBITDA was $20478 thousand with an Adjusted EBITDA Margin of 429%[18,22] - The company declared a quarterly dividend of $045 per share[11] Assets Under Management (AUM) - Total AUM reached $38968940 thousand, with $26703782 thousand (69%) from Managed Public Real Estate Capital and $12265158 thousand (31%) from Managed Private Real Estate Capital[18,32] Transactions and Liquidity - Two garden-style apartment communities were acquired for $147 million[9] - A $1 billion mortgage refinancing of Vertex Pharmaceuticals' headquarters in Boston was executed[9] - The company had $1623 million in total liquidity, including $623 million in cash on hand[19] Revenue Streams - Total Management & Advisory Services Revenues reached $45401 thousand[37,72] - Base Business Management & Advisory Revenues were $28760 thousand[37,71] - Base Property Management & Other Revenues amounted to $14574 thousand[37,71]

Core Insights - RMR Group reported quarterly earnings of $0.22 per share, matching the Zacks Consensus Estimate, but down from $0.34 per share a year ago [1] - The company posted revenues of $159.41 million for the quarter ended September 2025, missing the Zacks Consensus Estimate by 25.4% and down from $212.3 million year-over-year [2] - RMR Group shares have declined approximately 24.6% year-to-date, contrasting with the S&P 500's gain of 16.4% [3] Earnings and Revenue Performance - The company has not surpassed consensus EPS estimates in the last four quarters [1] - RMR Group has consistently missed consensus revenue estimates over the past four quarters [2] - The current consensus EPS estimate for the upcoming quarter is $0.25 on revenues of $221.8 million, and for the current fiscal year, it is $1.11 on revenues of $765.1 million [7] Market Outlook - The stock's immediate price movement will largely depend on management's commentary during the earnings call [3] - The Zacks Rank for RMR Group is currently 3 (Hold), indicating expected performance in line with the market [6] - The Real Estate - Operations industry is ranked in the bottom 35% of over 250 Zacks industries, which may impact RMR Group's stock performance [8]

Economic Risks and Market Conditions - The historical fees earned from clients should not be considered indicative of future results due to various risks, including adverse economic conditions and high interest rates [122]. - Clients may face significant competition for tenants and customers, which could impact their ability to generate revenue [122]. - A sustained period of high interest rates and inflation may increase operating costs and reduce property values, affecting clients' growth potential [123]. - Changes in market conditions and consumer preferences may lead to decreased demand for office space and hotel stays, impacting clients' financial performance [123]. - The ability of clients to adapt to changing economic conditions may be limited, particularly in less liquid real estate investments [123]. Financial Performance and Capital Access - The ability of clients to access capital on attractive terms is critical for pursuing acquisition and development opportunities [123]. - Deterioration in RMR LLC's financial condition could impair its ability to make distributions, affecting RMR Inc.'s liquidity [154]. - RMR Inc. is dependent on distributions from RMR LLC to cover taxes and expenses, as it has no independent revenue generation [153]. Shareholder and Governance Issues - ABP Trust controls a significant portion of voting power, which may limit other shareholders' influence and affect the market price of Class A Common Shares [131]. - Adam Portnoy holds more than 50.0% of the voting power of shares eligible to vote, classifying the company as a "controlled company" under Nasdaq rules [142]. - Related party transactions may increase the risk of conflicts of interest, potentially impacting the company's reputation and operations [136]. - The company may face reputational damage and financial risks due to potential conflicts of interest arising from overlapping investment objectives among clients [138]. - Shareholder litigation and dissident shareholder proposals may arise due to perceived conflicts of interest in business dealings with affiliated entities [141]. Debt and Interest Rate Exposure - As of September 30, 2025, RMR Inc. has $138,270 in outstanding floating rate debt with an average interest rate of 6.85% [236]. - A one percentage point increase in interest rates would raise the total floating rate interest expense to $9,927, impacting annual earnings per share by $0.59 [236]. - The fixed rate debt consists of a mortgage note with a principal balance of $46,500 at a 5.34% interest rate, requiring monthly interest payments until July 2029 [240]. - Changes in market interest rates will not affect the interest obligation of the fixed rate mortgage note, but a one percentage point change would alter annual interest costs by approximately $465 [240]. Investment and Growth Initiatives - Private Capital assets under management increased from approximately $1.3 billion as of September 30, 2021, to approximately $12.3 billion as of September 30, 2025 [152]. - The company has expanded its private capital real estate investments since entering the multifamily residential real estate sector in December 2023 [152]. - The TRMT Private Credit Fund was launched in July 2024, indicating a strategic initiative in private credit [152]. Tax and Financial Agreements - The tax receivable agreement requires RMR Inc. to pay ABP Trust 85.0% of cash savings realized from tax benefits, which may result in substantial payments [148]. - The company has a revolving credit facility with a total borrowing capacity of $100,000, with no amounts outstanding as of September 30, 2025 [239]. Cash Management - Cash and cash equivalents are maintained in U.S. bank accounts, with some balances exceeding FDIC insurance limits, but are not subject to material market risks [242].

THE RMR GROUP Financial Results and Supplemental Information FISCAL FOURTH QUARTER 2025 November 12, 2025 QUARTERLY RESULTS | Fiscal Fourth Quarter 2025 Highlights | | --- | | FINANCIALS | | Key Financial Data | | Adjusted Net Income Attributable to The RMR Group Inc. Bridge | | Distributable Earnings Bridge | | AUM by Source | | Management and Advisory Services Revenues by Source | | Well-Covered Dividend. | | GAAP Results: Condensed Consolidated Statements of Income ... | | GAAP Results: Earnings Per Comm ...

Core Viewpoint - Wall Street anticipates a year-over-year decline in earnings for RMR Group despite higher revenues, with the actual results being crucial for near-term stock price movements [1][2]. Earnings Expectations - RMR Group is expected to report quarterly earnings of $0.22 per share, reflecting a year-over-year decrease of 35.3% [3]. - Revenue projections stand at $213.7 million, indicating a slight increase of 0.7% from the previous year [3]. Estimate Revisions - The consensus EPS estimate has been revised down by 3.85% over the last 30 days, indicating a reassessment by analysts [4]. - The Most Accurate Estimate aligns with the Zacks Consensus Estimate, resulting in an Earnings ESP of 0%, suggesting no recent differing analyst views [12]. Earnings Surprise Prediction - The Zacks Earnings ESP model indicates that a positive or negative reading can predict deviations from consensus estimates, but its predictive power is stronger for positive readings [9][10]. - RMR Group currently holds a Zacks Rank of 3, complicating predictions of an earnings beat [12]. Historical Performance - In the last reported quarter, RMR Group met the expected earnings of $0.28 per share, resulting in no surprise [13]. - The company has not surpassed consensus EPS estimates in the last four quarters [14]. Conclusion - RMR Group does not appear to be a strong candidate for an earnings beat, and investors should consider additional factors when evaluating the stock ahead of the earnings release [17].

Financial Data and Key Metrics Changes - The company reported adjusted net income of $0.28 per share, distributable earnings of $0.43 per share, and adjusted EBITDA of $20.1 million, all in line with expectations [4][11] - Recurring service revenues were approximately $44 million, a sequential decrease of about $1.5 million, primarily due to lower property management fees at RMR Residential [11] - The company expects service revenues to increase to approximately $45 million next quarter based on favorable trends in managed REITs [11] Business Line Data and Key Metrics Changes - The Managed REITs have seen share price improvements, particularly for DHC and ILPT, which have increased substantially year to date [4] - The private capital business totals over $12 billion, with a focus on retail, residential, credit, and select development opportunities [4] - The retail sector is accumulating a portfolio of value-add multi-tenant retail assets valued at approximately $100 million, with a recent investment of $21 million in a community shopping center [5] Market Data and Key Metrics Changes - DHC's same property cash basis NOI increased by 18.5% year over year, driven by strong sector fundamentals [8] - SVC's RevPAR increased by 40 basis points year over year, outperforming the industry by 90 basis points despite renovation-related revenue displacement [9] - ILPT refinanced $1.2 billion of floating rate debt with new fixed-rate debt at a weighted average interest rate of 6.4% [9] Company Strategy and Development Direction - The company is focused on strategic initiatives for Managed REITs and private capital business, including deleveraging actions through asset sales and refinancings [4] - The residential sector is expected to benefit from decelerating supply growth and favorable migration trends, targeting mid to high teen returns [6] - The company aims to grow private capital AUM over the long term, with recent hiring of a Senior Vice President to enhance capital formation efforts [7] Management's Comments on Operating Environment and Future Outlook - Management noted ongoing economic uncertainty but remains focused on strategic initiatives [4] - The fundraising environment for private capital is challenging but showing signs of improvement, with expectations of continued ramp-up in the next six months [20] - The company anticipates adjusted EBITDA of approximately $20.5 million and distributable earnings between $0.44 and $0.46 per share for the next quarter [15] Other Important Information - The company expects to end the fiscal year with approximately $60 million in cash and no borrowings on its $100 million line of credit [15] - The dividend is funded through two sources: ARMOUR LLC and RMR Inc, with a coverage ratio of 74% from the operating business [45] Q&A Session Summary Question: What is the outlook for the fundraising environment on the private capital side? - Management acknowledged that while the fundraising environment remains challenging, it is improving, with increased meetings with potential capital providers [18][20] Question: Can you elaborate on the RMR Residential Enhanced Growth Venture? - The venture will include five assets, with a total equity investment of just under $100 million, aimed at attracting committed capital from investors [22][24] Question: What is the expected size of the fundraising on the residential side? - The goal is to raise about $300 million of equity for the residential venture, seeded with just under $100 million of assets [29] Question: How does the company view the performance of RMR Residential? - The current run rate is expected to remain steady until the fundraising environment normalizes, with AUM currently at about $4.6 billion [35][55] Question: What is the rationale behind the dividend coverage? - The dividend is funded through operating business contributions and cash reserves, with a focus on maintaining coverage as the business grows [45][47]

Core Insights - RMR Group reported a revenue of $154.73 million for the quarter ended June 2025, reflecting a decline of 24.7% year-over-year and a significant miss of 23.33% against the Zacks Consensus Estimate of $201.8 million [1] - The company's EPS for the quarter was $0.28, unchanged from the consensus estimate, but down from $0.37 in the same quarter last year [1] Revenue Breakdown - Management services revenue was $42.72 million, falling short of the estimated $45.88 million, representing a year-over-year decrease of 10.6% [4] - Advisory services revenue came in at $1.12 million, slightly below the average estimate of $1.14 million, marking a year-over-year decline of 1.1% [4] - Total reimbursable costs were reported at $107.95 million, significantly lower than the estimated $157.25 million, indicating a year-over-year drop of 30.9% [4] - Total management, termination, incentive, and advisory services revenues were $44.07 million, compared to the average estimate of $47.01 million, reflecting a 10.6% decrease year-over-year [4] - Other reimbursable expenses totaled $87.98 million, which was below the two-analyst average estimate of $133.52 million, representing a year-over-year decline of 33.5% [4] Stock Performance - RMR Group's shares have returned -5% over the past month, contrasting with the Zacks S&P 500 composite's +1% change, indicating underperformance relative to the broader market [3] - The stock currently holds a Zacks Rank 3 (Hold), suggesting it may perform in line with the market in the near term [3]

Core Insights - RMR Group reported quarterly earnings of $0.28 per share, matching the Zacks Consensus Estimate, but down from $0.37 per share a year ago [1] - The company posted revenues of $154.73 million for the quarter ended June 2025, missing the Zacks Consensus Estimate by 23.33% and down from $205.48 million year-over-year [2] - RMR Group shares have declined approximately 21.9% year-to-date, contrasting with the S&P 500's gain of 7.6% [3] Earnings Outlook - The company's earnings outlook is crucial for investors, as it includes current consensus earnings expectations for upcoming quarters and any recent changes to these expectations [4] - The current consensus EPS estimate for the next quarter is $0.28 on revenues of $211.43 million, and for the current fiscal year, it is $1.17 on revenues of $825.24 million [7] Industry Context - The Real Estate - Operations industry, to which RMR Group belongs, is currently ranked in the top 29% of over 250 Zacks industries, indicating a favorable outlook compared to lower-ranked industries [8] - Empirical research suggests a strong correlation between near-term stock movements and trends in earnings estimate revisions, which can be tracked by investors [5]