Apple Hospitality REIT(US:APLE)2025-05-01 20:15Hotel Portfolio - As of March 31, 2025, the Company owned 219 hotels with a total of 29,558 guest rooms, a decrease from 224 hotels and 29,886 guest rooms as of March 31, 2024[84][90]. - As of March 31, 2025, the company owns 219 hotels and one non-hotel property, with a total of 30,000 guest rooms[120]. - The average number of guest rooms per hotel in the portfolio is approximately 137[120]. - The largest hotel in the portfolio is located in San Diego, CA, with 245 guest rooms[121]. - The company has expanded its portfolio with various brands including Embassy Suites, Hilton Garden Inn, and Residence Inn across multiple states[121][122][123]. - The company continues to focus on market expansion, particularly in states like California and Florida, with multiple new hotel openings planned[121][122]. Financial Performance - Total revenue for the three months ended March 31, 2025, was $327.7 million, a decrease of 0.5% compared to $329.5 million for the same period in 2024[93][99]. - Net income for the three months ended March 31, 2025, was $31.2 million, down 42.2% from $54.1 million in the same period of 2024[93]. - Average Daily Rate (ADR) increased by 2.0% to $156.24 for the three months ended March 31, 2025, compared to $153.18 in 2024[93][100]. - Revenue per Available Room (RevPAR) increased by 0.7% to $111.04 for the three months ended March 31, 2025, compared to $110.25 in 2024[93][100]. - EBITDA for Q1 2025 was $98.9 million, compared to $118.5 million in Q1 2024, reflecting a decrease in operational performance[117]. Operating Expenses - The Company’s hotel operating expenses increased by 1.3% to $199.9 million for the three months ended March 31, 2025, compared to $197.3 million in 2024[93]. - Hotel operating expenses for Q1 2025 totaled $199.9 million, representing 61.0% of total revenue, compared to $197.3 million or 59.9% in Q1 2024[101]. - Property taxes, insurance, and other expenses increased to $23.4 million in Q1 2025, accounting for 7.1% of total revenue, up from $21.0 million or 6.4% in Q1 2024[102]. - General and administrative expenses decreased to $9.2 million in Q1 2025, representing 2.8% of total revenue, down from $10.6 million or 3.2% in Q1 2024[103]. - Depreciation and amortization expense rose to $47.9 million in Q1 2025, compared to $46.8 million in Q1 2024, primarily due to acquisitions and renovations[104][105]. - Interest and other expenses, net, increased to $19.4 million in Q1 2025 from $17.3 million in Q1 2024, influenced by higher average borrowings and interest rates[106][107]. Cash Flow and Distributions - For the three months ended March 31, 2025, the company paid distributions of $0.29 per common share, totaling $69.6 million[138]. - The current annual distribution rate is $0.96 per common share, with monthly distributions of $0.08 expected to continue[139]. - The company declared a monthly cash distribution of $0.08 per common share on March 20, 2025, payable on April 15, 2025[138]. - The company anticipates that cash flow from operations and availability under its Revolving Credit Facility will meet its liquidity requirements, including required distributions to shareholders[136]. - The company may utilize additional financing sources to maintain its distribution rate if cash flows from operations are insufficient[139]. Debt and Financing - As of March 31, 2025, the company had total outstanding debt of $1.5 billion, consisting of $252.3 million in mortgage debt and $1.3 billion under unsecured credit facilities[131]. - The Company had approximately $361.1 million in principal and interest payments due on its debt over the next 12 months, including a $25.9 million mortgage maturing in Q2 2025[142]. - As of March 31, 2025, approximately $428.0 million, or 28% of the Company's total debt, was subject to variable interest rates, with every 100 basis points change impacting annual net income by approximately $4.3 million[155]. - The Company had 12 interest rate swap agreements fixing interest payments on approximately $735.0 million of variable-rate debt, with maturity dates ranging from May 2025 to December 2029[156]. - The company has a universal shelf registration statement that allows for the offering of an indeterminate number of common shares and other securities[134]. Capital Expenditures and Investments - The Company invested approximately $19.6 million in capital expenditures during the three months ended March 31, 2025, and anticipates spending $80 million to $90 million in 2025 for renovations across approximately 20 properties[141]. - The Company approved a one-year extension of its Share Repurchase Program, authorizing repurchases up to $335.4 million, with approximately $274.5 million remaining available as of March 31, 2025[140]. - During the three months ended March 31, 2025, the Company repurchased approximately 1.9 million common shares at an average price of $13.61 per share, totaling approximately $26.3 million[140]. - The company plans to use future net proceeds from share sales for acquisitions, debt repayment, capital expenditures, and working capital[135]. Future Outlook - The Company expects RevPAR for its Comparable Hotels to seasonally improve and to be in line with 2024 for the full year of 2025, assuming current macroeconomic conditions persist[98]. - The company anticipates a more favorable operating expense environment for the remainder of 2025, despite ongoing inflationary pressures and labor market challenges[101]. - The Company expects inflationary pressures and supply chain issues to potentially increase costs and delays for anticipated renovation projects[141]. - Future outlook includes a focus on enhancing customer experience through new technology and service offerings[120]. - The company is exploring new strategies for growth, including potential mergers and acquisitions to enhance its market presence[120].