Apple Hospitality REIT(APLE) - 2024 Q4 - Annual Results

Financial Performance - Net income for Q4 2024 was $29.8 million, a 43.6% increase from $20.8 million in Q4 2023; full year net income reached $214.1 million, up 20.6% from $177.5 million in 2023[2] - Adjusted EBITDAre for Q4 2024 was approximately $97 million, a 7% increase from the same period in 2023; full year Adjusted EBITDAre was $467 million, also up 7%[10] - Total revenue for the year ended December 31, 2024, was $1,431,468,000, an increase of 6.5% compared to $1,343,800,000 in 2023[35] - Operating income for the three months ended December 31, 2024, was $49,903,000, up 28.3% from $38,910,000 in the same period of 2023[37] - Operating margin for the year ended December 31, 2024, improved to 20.5%, up 210 basis points from 18.4% in 2023[37] Hotel Operations - Comparable Hotels RevPAR grew approximately 3% in Q4 2024 and over 1% for the full year 2024 compared to the same periods in 2023[5] - Comparable Hotels Adjusted Hotel EBITDA for Q4 2024 was approximately $108 million, a 3% increase from Q4 2023; full year Comparable Hotels Adjusted Hotel EBITDA was $509 million, a slight improvement over 2023[9] - Average Daily Rate (ADR) for Comparable Hotels was $152.97 in Q4 2024, up 0.6% from Q4 2023; full year ADR was $158.94, up 0.5%[9] - Occupancy rate for Comparable Hotels was 71.3% for the three months ended December 31, 2024, compared to 69.9% in 2023, reflecting a 2.0% increase[37] Capital Expenditures and Investments - The Company invested approximately $78 million in capital expenditures during 2024 and anticipates investing between $80 million and $90 million in 2025[18] - The Company acquired two hotels for approximately $196 million and sold six non-core hotels for over $63 million during 2024[6] - The Company sold six hotels in 2024 for a combined gross sales price of approximately $63.4 million, resulting in a gain of approximately $19.7 million[14] Debt and Financial Position - Total debt to total capitalization, net of cash and cash equivalents, was approximately 28% as of December 31, 2024[12] - The Company maintained a strong balance sheet with total debt outstanding of $0 as of December 31, 2024[2] - As of December 31, 2024, the Company had approximately $1.5 billion in total outstanding debt with a weighted-average interest rate of approximately 4.7%[19] - Total liabilities as of December 31, 2024, were $1,704,061,000, an increase from $1,613,317,000 in 2023[34] Shareholder Returns - Distributions paid per share remained stable at $0.24 for Q4 2024, with an annualized yield of approximately 6.5% based on the stock price of $14.76[12] - The Company paid distributions totaling $1.01 per common share for the year ended December 31, 2024, amounting to approximately $243.7 million[22] - The Company repurchased approximately 2.4 million common shares at a weighted-average price of approximately $14.16 per share, totaling approximately $34.7 million in 2024[20] Future Guidance - For 2025, the Company anticipates net income guidance between $173 million and $202 million, with Comparable Hotels RevPAR Change guidance of 1.0% to 3.0%[24] - The company's net income guidance for the year ending December 31, 2025, ranges from $173,214 thousand to $202,114 thousand[64] - EBITDA is projected to be between $443,422 thousand and $467,722 thousand for the same period[64] Market Performance - The overall performance in the top 20 markets indicates a recovery trend, with several markets showing significant growth in both occupancy and revenue metrics[71] - The average Adjusted ADR across all top 20 markets was $162.00, a slight increase of 0.2% from $161.61 in Q4 2023[71] - The hotel occupancy rate in the top 20 markets improved to 73.3%, up from 66.8% in the previous year, indicating a 9.7% increase[77] Operational Efficiency - The operating margin for Q1 2024 is 21.7%, an improvement from 15.8% in Q1 2023, indicating enhanced operational efficiency[49] - Total portfolio occupancy increased to 75.1% in 2024 from 74.4% in 2023, a change of 0.9%[80] - The suburban segment contributed 44.1% to the adjusted hotel EBITDA in YTD 2024, with an occupancy rate of 75.5%[96]