Core Viewpoint Sotherly Hotels Inc. reported its financial results for the fourth quarter and full year of 2024, showing an increase in total revenues and Hotel EBITDA, despite a net loss attributable to common stockholders. The company is optimistic about ongoing improvements in demand across its hotel portfolio as it transitions into 2025. Financial Performance - Total revenues for Q4 2024 were approximately $44.0 million, up from $42.1 million in Q4 2023, representing a 4.2% increase [2][3] - For the full year 2024, total revenues increased to approximately $181.9 million, compared to $173.8 million in 2023, marking a 4.6% growth [2][3] - Net loss attributable to common stockholders for Q4 2024 was approximately $3.0 million, compared to a loss of $2.7 million in Q4 2023, reflecting a 12.4% increase in loss [5] - For the full year, net loss attributable to common stockholders increased by 65.4% to approximately $6.7 million from $4.0 million in 2023 [5] Key Metrics - RevPAR for Q4 2024 was $108.99, a 2.6% increase from $106.25 in Q4 2023, driven by a 4.1% increase in occupancy [2][3] - For the full year, RevPAR increased by 3.7% to $119.26 from $114.96 in 2023 [2] - Hotel EBITDA for Q4 2024 was approximately $10.7 million, up from $10.3 million in Q4 2023, a 3.9% increase [5] - Adjusted FFO for Q4 2024 decreased by 30.3% to approximately $2.0 million from $2.8 million in Q4 2023 [5] Balance Sheet and Liquidity - As of December 31, 2024, the company had approximately $28.7 million in available cash, with $21.4 million reserved for various expenses [4] - The company had outstanding debt of approximately $319.3 million at a weighted average interest rate of 5.88% [4] 2025 Outlook - The company is encouraged by improvements in demand in markets that were slow to recover post-pandemic, particularly in Houston, Atlanta, Hollywood (Florida), and Philadelphia [3] - Guidance for 2025 includes expectations for continued revenue growth and profitability improvements across its portfolio [5]

Core Viewpoint - Sotherly Hotels Inc. is amending the estimated income tax classification information for its 2024 distributions on Series D preferred shares due to previously incorrect "paid" and "record" dates [1] Distribution Summary Series B Preferred Shares - Total cash distribution per share is $0.500000 for each of the four payment dates, resulting in a total of $2.000000 for 2024, all classified as ordinary income [2] - 100% of the distribution is taxable [2] Series C Preferred Shares - Total cash distribution per share is $0.492188 for each of the four payment dates, leading to a total of $1.968752 for 2024, all classified as ordinary income [3] - 100% of the distribution is taxable [3] Series D Preferred Shares - Total cash distribution per share is $0.515625 for three payment dates, with a total of $2.062500 for 2024, all classified as ordinary income [4] - 100% of the distribution is taxable [4] Tax Reporting - No portion of the dividends declared in 2024 represented foreign taxes or qualified dividend income [5] - Shareholders will receive IRS Form 1099-DIV from Equiniti Trust Company, reporting the dividends paid for 2024 [6] Company Overview - Sotherly Hotels Inc. is a self-managed and self-administered lodging REIT focused on acquiring, renovating, and repositioning upscale to upper-upscale full-service hotels in the Southern United States [8] - The company's portfolio includes twelve hotel properties with a total of 2,786 rooms, as well as interests in two condominium hotels [8] - The company operates hotels under brands such as Hilton, Marriott, and Hyatt, and was organized in 2004, headquartered in Williamsburg, Virginia [8]

Core Viewpoint - Sotherly Hotels Inc. has announced the estimated income tax classification for its 2024 distributions on Series B, C, and D preferred shares, which will be reported on Form 1099-DIV [1]. Group 1: Series B Preferred Shares - The total cash distribution per share for Series B preferred shares is $0.50, with 100% classified as ordinary income [2]. - The total distribution for Series B preferred shares for 2024 amounts to $2.00 [2]. Group 2: Series C Preferred Shares - The total cash distribution per share for Series C preferred shares is $0.492188, also classified entirely as ordinary income [3]. - The total distribution for Series C preferred shares for 2024 is $1.968752 [3]. Group 3: Series D Preferred Shares - The total cash distribution per share for Series D preferred shares is $0.515625, with 100% classified as ordinary income [4]. - The total distribution for Series D preferred shares for 2024 is $2.062500 [4]. Group 4: Tax Reporting Information - No portion of the dividends declared in 2024 represented foreign taxes or qualified dividend income [5]. - Shareholders will receive IRS Form 1099-DIV from Equiniti Trust Company, LLC, reporting the dividends paid for 2024 [5][6]. - The tax information provided is preliminary and subject to correction, but no material changes are expected [7]. Group 5: Company Overview - Sotherly Hotels Inc. is a self-managed lodging REIT focused on acquiring, renovating, and repositioning upscale hotels in the Southern United States, with a portfolio of twelve hotel properties totaling 2,786 rooms [8]. - The company operates hotels under major brands such as Hilton, Marriott, and Hyatt, and was organized in 2004, headquartered in Williamsburg, Virginia [8].

Core Viewpoint - Sotherly Hotels Inc. will report its fourth quarter 2024 financial results on March 13, 2025, prior to market opening, followed by a conference call for discussion [1] Group 1: Financial Reporting - The financial results for the fourth quarter 2024 will be announced before the market opens on March 13, 2025 [1] - A conference call is scheduled for 10:00 a.m. Eastern Time on the same day to discuss the results [1] - The earnings release will be available on the Company's website in the Investors section [1] Group 2: Conference Call Details - The conference call can be accessed by telephone at 833-470-1428 with access code 538548 [2] - A webcast option is available, and participants should visit the Investor Relations section of the website at least 15 minutes prior to the call [2] - A taped rebroadcast will be available approximately one hour after the live call until March 20, 2025, accessible by dialing 866-813-9403 with access code 963139 [2] Group 3: Company Overview - Sotherly Hotels Inc. is a self-managed and self-administered lodging REIT focused on upscale to upper-upscale full-service hotels in the Southern United States [3] - The Company currently has a portfolio of ten hotel properties with a total of 2,786 rooms, along with interests in two condominium hotels [3] - Sotherly Hotels operates hotels under brands such as Hilton Worldwide and Hyatt Hotels Corporation, as well as independent hotels [3]

Core Viewpoint - Sotherly Hotels (SOHO) has been upgraded to a Zacks Rank 2 (Buy), indicating a positive trend in earnings estimates which is a significant factor influencing stock prices [1][3]. Earnings Estimates and Stock Performance - The Zacks rating system is based on changes in earnings estimates, which are crucial for predicting near-term stock price movements [2][4]. - An increase in earnings estimates typically leads to buying pressure and a potential rise in stock price [3][5]. Company-Specific Insights - Sotherly Hotels is projected to earn $0.69 per share for the fiscal year ending December 2024, reflecting a year-over-year increase of 1.5% [8]. - Over the past three months, the Zacks Consensus Estimate for Sotherly Hotels has risen by 7.8%, indicating a positive outlook from analysts [8]. Zacks Rank System - The Zacks Rank system categorizes stocks into five groups based on earnings estimates, with a strong historical performance, particularly for Zacks Rank 1 stocks which have averaged a +25% annual return since 1988 [7]. - Sotherly Hotels' upgrade to Zacks Rank 2 places it in the top 20% of Zacks-covered stocks, suggesting a strong potential for market-beating returns in the near term [10][11].

Revenue Performance - Total revenue for Q3 2024 increased by approximately $1.5 million, or 3.9%, to approximately $40.7 million compared to Q3 2023 revenue of approximately $39.2 million[199]. - Room revenue for Q3 2024 increased by approximately $0.9 million, or 3.4%, to approximately $27.2 million compared to Q3 2023 room revenue of approximately $26.3 million[201]. - Food and beverage revenues increased by approximately $0.2 million, or 3.1%, to approximately $7.7 million for Q3 2024 compared to $7.5 million in Q3 2023[202]. - Revenue from other operating departments increased by approximately $0.4 million, or 7.0%, to approximately $5.8 million for Q3 2024 compared to $5.4 million in Q3 2023[203]. - Total revenue for the nine months ended September 30, 2024, increased by approximately $6.2 million, or 4.7%, to approximately $137.9 million compared to $131.7 million for the same period in 2023[214]. - Room revenue increased approximately $3.6 million, or 4.1%, to approximately $91.5 million for the nine months ended September 30, 2024, compared to $87.9 million for the same period in 2023[215]. - Food and beverage revenues increased approximately $1.6 million, or 6.4%, to approximately $27.4 million for the nine months ended September 30, 2024, compared to $25.8 million for the same period in 2023[216]. Occupancy and RevPAR - RevPAR for Q3 2024 increased by 4.1% from $102.82 in 2023 to $107.02 in 2024, driven by a 4.8% increase in occupancy[201]. - Occupancy rate for Q3 2024 was 66.9%, up from 62.4% in Q3 2023[198]. - Composite portfolio occupancy rate for Q3 2024 was 66.3%, up from 61.5% in Q3 2023[198]. - Composite portfolio RevPAR for Q3 2024 was $107.02, compared to $102.82 in Q3 2023[198]. Expenses - Hotel operating expenses increased by approximately $1.0 million, or 3.2%, to approximately $32.6 million for Q3 2024 compared to $31.6 million in Q3 2023[204]. - Room expenses for Q3 2024 increased by approximately $0.2 million, or 2.5%, to approximately $6.6 million compared to $6.4 million in Q3 2023[205]. - Food and beverage expenses for the three months ended September 30, 2024, increased approximately $0.2 million, or 3.3%, to approximately $5.8 million compared to $5.6 million for the same period in 2023[206]. - Other operating department expenses for the three months ended September 30, 2024, increased approximately $0.1 million, or 5.5%, to approximately $2.3 million compared to $2.2 million for the same period in 2023[207]. - Corporate general and administrative expenses for the three months ended September 30, 2024, decreased approximately $0.2 million, or 12.8%, to approximately $1.5 million compared to $1.7 million for the same period in 2023[208]. - Hotel operating expenses increased approximately $4.6 million, or 4.7%, to approximately $101.8 million for the nine months ended September 30, 2024, compared to $97.2 million for the same period in 2023[218]. Net Loss and Financial Metrics - Net loss for the three months ended September 30, 2024, was approximately $3.7 million compared to a net loss of approximately $2.1 million for the same period in 2023[213]. - For the three months ended September 30, 2024, the net loss was $3,689,621 compared to a net loss of $2,065,826 for the same period in 2023, indicating an increase in losses of approximately 78.5%[235]. - FFO (Funds From Operations) for the three months ended September 30, 2024, was $1,123,585, down 46.0% from $2,079,893 in the same period of 2023[235]. - EBITDA for the three months ended September 30, 2024, was $6,424,154, a decrease of 1.7% compared to $6,538,547 for the same period in 2023[239]. - Hotel EBITDA for the nine months ended September 30, 2024, was $36,145,082, an increase of 4.8% from $34,487,941 for the same period in 2023[239]. Cash Flow and Capital Expenditures - The company had approximately $14.0 million in unrestricted cash and $18.5 million in restricted cash as of September 30, 2024[240]. - Net cash flow provided by operating activities for the nine months ended September 30, 2024, was approximately $21.4 million, attributed to increased occupancy rates[241]. - Cash used in investing activities for the nine months ended September 30, 2024, was approximately $9.8 million, primarily for capital expenditures of $10.1 million related to hotel improvements[243]. - The company expects total capital expenditures for 2024 to be approximately $7.2 million, maintaining a target of 4.0% of gross revenue[246]. - Total capital expenditures related to the renovation of the Philadelphia property are expected to be approximately $11.5 million over fiscal years 2024, 2025, and 2026[249]. Debt and Financing - As of September 30, 2024, the company secured a $35.0 million mortgage on the Hotel Alba, with a fixed interest rate of 8.49% and a maturity date of March 6, 2029[252]. - The company amended the mortgage loan agreement on the DoubleTree by Hilton Philadelphia Airport, extending the maturity to April 29, 2026, requiring interest-only payments at a floating rate of SOFR plus 3.50%, and a principal reduction of $3.0 million[253]. - A $26.25 million mortgage loan was secured for the DoubleTree by Hilton Jacksonville Riverfront, with an additional $9.49 million available for a product improvement plan, maturing on July 8, 2029[254]. - A $5.0 million second mortgage loan was secured on the DeSoto hotel in Savannah, GA, with a fixed interest rate of 7.50% and a maturity date of July 1, 2026[255]. - The company plans to refinance the mortgage on The Georgian Terrace, which matures in June 2025, potentially requiring a reduction of up to $5.25 million in indebtedness[256]. - The mortgage on the DoubleTree Resort by Hilton Hollywood Beach matures in October 2025, with a potential requirement to reduce indebtedness by up to $12.5 million[257]. - As of September 30, 2024, the company was in compliance with all debt covenants, except for a covenant default under the mortgage on the DoubleTree by Hilton Jacksonville Riverfront, which may require a prepayment of approximately $1.2 million[261]. - As of September 30, 2024, the company had approximately $245.4 million of fixed-rate debt with a weighted-average interest rate of 5.32% and $75.9 million of variable-rate debt[280]. - A one percent increase in SOFR and the Prime Rate would impact annual interest incurred and cash flows by approximately $0.6 million based on the variable-rate debt[280]. - The company expects to meet long-term liquidity requirements through various means, including additional issuances of common and preferred shares, secured and unsecured borrowings, and selective disposition of non-core assets[259]. - As of September 30, 2024, cumulative unpaid dividends on outstanding preferred shares were approximately $21.9 million, with expectations for "catch-up" distributions[269].

Financial Data and Key Metrics Changes - For Q3 2024, total revenue was approximately $40.7 million, representing a 3.9% increase over the same quarter in 2023 [19] - Year-to-date total revenue was approximately $137.9 million, reflecting a 4.7% increase over the same period last year [19] - Hotel EBITDA for the quarter was approximately $8.1 million, a 6.8% increase from the same quarter in 2023 [20] - Year-to-date hotel EBITDA was approximately $36.1 million, representing a 4.8% increase over the same period last year [20] - Adjusted FFO for the quarter was a deficit of approximately $350,000, a decrease of approximately $400,000 from the same quarter last year [21] - Year-to-date adjusted FFO was approximately $12.3 million, reflecting a 5% increase over the same period in 2023 [21] Business Line Data and Key Metrics Changes - RevPAR for the Composite portfolio increased 4.1% in Q3 2024, driven by a 7.8% increase in occupancy and a 3.4% decrease in ADR [4] - Year-to-date RevPAR performance represents an increase of 4.6% over the same period in 2023, driven by a 6.9% increase in occupancy and a 2.2% decrease in rate [5] - Hotel Alba in Tampa grew RevPAR by 13.6%, fueled by a 14.5% occupancy gain over the prior year [9] - The Whitehall in Houston grew occupancy by 60.4%, resulting in a 51.9% growth in RevPAR over the prior year [11] Market Data and Key Metrics Changes - The portfolio's occupancy growth was highlighted by slower-to-recover urban markets, indicating stabilization in lodging fundamentals [6] - Preliminary October RevPAR shows a 6.1% improvement over the prior year, driven by continued improvement at urban hotels [38] - Full year 2024 RevPAR for the portfolio is forecasted to range between 102% and 104% of full year 2023 RevPAR [38] Company Strategy and Development Direction - The company is focusing on a repositioning strategy to lifestyle hotels to enhance competitiveness in dynamic markets [37] - A secured loan was executed for the DoubleTree by Hilton Jacksonville Riverfront hotel to fund a product improvement plan [17] - The company plans to undertake a complete renovation of the Jacksonville hotel with an estimated cost of approximately $14.6 million [18] Management's Comments on Operating Environment and Future Outlook - Management expressed cautious optimism regarding operating fundamentals for the balance of the year, with upscale hotels expected to outperform the broader lodging market [38] - The occupancy improvement at urban locations is seen as an encouraging sign of nearing stabilization following an uneven recovery [28] - Despite challenges from major storms, the company expects to recover lost revenues through business interruption insurance [30] Other Important Information - Two major storms impacted operations, with Hurricane Helene causing significant operational challenges and damage to the Tampa asset [8][14] - The company anticipates routine capital expenditures for the replacement and refurbishment of furniture, fixtures, and equipment to be approximately $7.2 million for 2024 [24] Q&A Session Summary Question: Is the portfolio overall back to 2019 performance levels? - Management indicated that there is still room for growth in occupancy, suggesting that the portfolio has not fully returned to 2019 levels [40] Question: Can you explain the hurricane damage impact on earnings? - Management clarified that there will be some impairment at the hotel due to the casualty, but they expect to recover this through business interruption insurance [41][45] Question: What is the rationale behind the second mortgage on the DeSoto? - The second mortgage is directly related to funding an exterior restoration project at the property [49][50]

Revenue Performance - Total revenue for Q2 2024 increased by approximately $1.7 million, or 3.4%, to approximately $50.7 million compared to Q2 2023 revenue of approximately $49.0 million[170]. - Room revenue for Q2 2024 increased by approximately $1.3 million, or 4.0%, to approximately $34.6 million compared to Q2 2023 room revenue of approximately $33.3 million[171]. - RevPAR for Q2 2024 increased by 4.3% to $137.67, driven by a 4.0% increase in occupancy[171]. - Food and beverage revenues for Q2 2024 increased by approximately $0.4 million, or 4.2%, to approximately $9.9 million compared to Q2 2023 revenues of approximately $9.5 million[172]. - Total revenue for the six months ended June 30, 2024, increased by approximately $4.7 million, or 5.1%, to approximately $97.2 million compared to $92.5 million for the same period in 2023[184]. - Room revenue increased by approximately $2.6 million, or 4.3%, to approximately $64.3 million for the six months ended June 30, 2024, compared to $61.7 million for the same period in 2023[185]. - Food and beverage revenues increased by approximately $1.4 million, or 7.7%, to approximately $19.6 million for the six months ended June 30, 2024, compared to $18.2 million for the same period in 2023[186]. Operating Expenses - Hotel operating expenses for Q2 2024 increased by approximately $0.8 million, or 2.4%, to approximately $35.0 million compared to Q2 2023 expenses of approximately $34.2 million[174]. - Room expenses for Q2 2024 increased by approximately $0.4 million, or 6.2%, to approximately $7.4 million compared to Q2 2023 room expenses of approximately $7.0 million[175]. - Food and beverage expenses for the three months ended June 30, 2024, increased by approximately $0.1 million, or 2.4%, to approximately $6.5 million compared to $6.4 million for the same period in 2023[176]. - Expenses from other operating departments for the three months ended June 30, 2024, increased by approximately $0.2 million, or 8.7%, to approximately $2.5 million compared to $2.3 million for the same period in 2023[177]. - Hotel operating expenses increased by approximately $3.6 million, or 5.5%, to approximately $69.2 million for the six months ended June 30, 2024, compared to $65.6 million for the same period in 2023[188]. Interest and Income - Interest expense for the three months ended June 30, 2024, increased by approximately $0.7 million, or 16.6%, to approximately $5.0 million compared to $4.3 million for the same period in 2023[180]. - Interest expense for the six months ended June 30, 2024, increased by approximately $1.5 million, or 17.7%, to approximately $9.9 million compared to $8.4 million for the same period in 2023[195]. - Net income for the six months ended June 30, 2024, was approximately $6.0 million, compared to approximately $6.6 million for the same period in 2023[199]. - Net income for the three months ended June 30, 2024, was $4,664,232, a decrease of 11.3% compared to $5,257,670 for the same period in 2023[206]. - FFO (Funds From Operations) for the three months ended June 30, 2024, was $9,349,904, slightly up from $9,244,823 in 2023, indicating a 1.1% increase[206]. - Adjusted FFO attributable to common stockholders for the three months ended June 30, 2024, was $7,503,096, compared to $7,031,038 in 2023, reflecting a 6.7% increase[206]. - Hotel EBITDA for the three months ended June 30, 2024, was $15,697,679, an increase of 5.8% from $14,842,036 in the same period of 2023[210]. Cash Flow and Capital Expenditures - Cash flow from operating activities for the six months ended June 30, 2024, was approximately $16.7 million, attributed to increased occupancy rates[212]. - Total capital expenditures for 2024 are expected to be approximately $7.0 million, maintaining a historical target of 4.0% of gross revenue[216]. - Cash used in investing activities for the six months ended June 30, 2024, was approximately $5.0 million, primarily for capital improvements[213]. - The company expects to incur approximately $11.5 million in capital expenditures for renovations in Philadelphia, funded through reserve accounts and working capital[219]. Debt and Liquidity - As of June 30, 2024, the company had approximately $18.9 million in unrestricted cash and $18.4 million in restricted cash, ensuring adequate liquidity for operations[221]. - The company secured a $35.0 million mortgage on the Hotel Alba in Tampa, Florida, with a fixed interest rate of 8.49%[222]. - The company amended the mortgage loan agreement on the DoubleTree by Hilton Philadelphia Airport, extending the maturity to April 29, 2026, requiring interest-only payments at a floating rate of SOFR plus 3.50%, and a principal reduction of $3.0 million[223]. - A $26.25 million mortgage loan was secured for the DoubleTree by Hilton Jacksonville Riverfront, with an additional $9.49 million available for a product improvement plan, maturing on July 8, 2029[224][225]. - A $5.0 million second mortgage loan was secured on the DeSoto hotel in Savannah, GA, with a fixed interest rate of 7.50% and a maturity date of July 1, 2026[226]. - As of June 30, 2024, the company was in compliance with all debt covenants except for a covenant default under the mortgage on the DoubleTree by Hilton Philadelphia Airport, for which waivers were obtained[232]. - As of September 30, 2024, the company failed to maintain compliance with financial covenants under the mortgage on the DoubleTree by Hilton Jacksonville Riverfront, potentially requiring a prepayment of approximately $1.2 million[233]. - The company plans to continue investing in hotel properties as opportunities arise, but access to additional capital may be limited due to economic changes in the travel industry post-COVID-19[229]. - The company expects to meet long-term liquidity requirements through various means, including additional issuances of common and preferred shares, secured and unsecured borrowings, and selective disposition of non-core assets[230]. - As of June 30, 2024, cumulative unpaid dividends on outstanding preferred shares were approximately $21.9 million, with future distributions subject to board approval[240]. - The company had approximately $273.4 million of fixed-rate debt as of June 30, 2024, with a weighted-average interest rate of 5.28%[251]. - A one percent increase in SOFR and the Prime Rate would impact annual interest incurred and cash flows by approximately $0.3 million based on the variable-rate debt outstanding[251].

Group 1: Financial Performance - Sotherly Hotels reported a quarterly loss of $0.04 per share, missing the Zacks Consensus Estimate of $0.01, compared to break-even FFO per share a year ago, representing an FFO surprise of -500% [1] - The company posted revenues of $40.7 million for the quarter ended September 2024, missing the Zacks Consensus Estimate by 3.10%, and showing an increase from year-ago revenues of $39.18 million [2] - The current consensus FFO estimate for the coming quarter is $0.10 on $44.4 million in revenues, and for the current fiscal year, it is $0.69 on $183.7 million in revenues [7] Group 2: Market Performance - Sotherly Hotels shares have lost about 18.1% since the beginning of the year, while the S&P 500 has gained 25.8% [3] - The company has surpassed consensus FFO estimates two times over the last four quarters [2] Group 3: Future Outlook - The sustainability of the stock's immediate price movement will depend on management's commentary on the earnings call [3] - The estimate revisions trend for Sotherly Hotels is currently mixed, resulting in a Zacks Rank 3 (Hold) for the stock, indicating expected performance in line with the market in the near future [6] - The outlook for the REIT and Equity Trust - Other industry is currently in the top 27% of the Zacks industries, suggesting potential for outperformance [8]

Exhibit 99.1 FOR IMMEDIATE RELEASE TUESDAY, NOVEMBER 12, 2024 SOTHERLY HOTELS INC. REPORTS FINANCIAL RESULTS FOR THE THIRD QUARTER ENDED SEPTEMBER 30, 2024 Williamsburg, Virginia – November 12, 2024 – Sotherly Hotels Inc. (NASDAQ: SOHO), ("Sotherly" or the "Company"), a selfmanaged and self-administered lodging real estate investment trust (a "REIT"), today reported its consolidated results for the third quarter ended September 30, 2024. The Company's results include the following*: | --- | --- | --- | --- ...