Sotherly Hotels(SOHO) - 2025 Q2 - Quarterly Results

Financial Performance Summary Sotherly Hotels reported a Q2 2025 decline in key financial metrics, including revenues and a shift to net loss, reflecting decelerating hotel demand Q2 2025 vs Q2 2024 Financial Highlights ($ in thousands, except per share data) | Metric | Q2 2025 | Q2 2024 | Change (%) | | :--- | :--- | :--- | :--- | | Total Revenues ($) | $48,794 | $50,694 | -3.7 | | Net Income ($) | $1,556 | $4,664 | -66.6 | | Net (Loss) Income to Common Stockholders ($) | $(416) | $2,622 | -115.9 | | Diluted EPS ($) | $(0.02) | $0.13 | -115.4 | | Hotel EBITDA ($) | $13,892 | $15,698 | -11.5 | | Adjusted FFO ($) | $4,758 | $7,503 | -36.6 | Six Months Ended June 30, 2025 vs 2024 Financial Highlights ($ in thousands) | Metric | H1 2025 | H1 2024 | Change (%) | | :--- | :--- | :--- | :--- | | Total Revenues ($) | $97,106 | $97,243 | -0.1 | | Net Income ($) | $6,290 | $5,987 | +5.1 | | Net Income to Common Stockholders ($) | $2,274 | $1,962 | +15.9 | | Hotel EBITDA ($) | $26,813 | $28,058 | -4.4 | | Adjusted FFO ($) | $9,275 | $12,683 | -26.9 | - The CEO, Dave Folsom, attributed the Q2 deceleration in hotel demand to broader macroeconomic uncertainty, including the interest rate climate and tariffs, while noting resilient group booking pace[5] Key Operating Metrics The composite portfolio's Q2 2025 RevPAR decreased by 5.4% to $130.20, driven by declines in occupancy and ADR Composite Portfolio Key Metrics - Q2 2025 vs Q2 2024 | Metric | Q2 2025 | Q2 2024 | Change (%) | | :--- | :--- | :--- | :--- | | RevPAR ($) | $130.20 | $137.67 | -5.4 | | Occupancy (%) | 70.8 | 73.4 | -3.5 | | ADR ($) | $183.88 | $187.51 | -1.9 | Composite Portfolio Key Metrics - Six Months Ended June 30 | Metric | H1 2025 | H1 2024 | Change (%) | | :--- | :--- | :--- | :--- | | RevPAR ($) | $129.97 | $130.64 | -0.5 | | Occupancy (%) | 69.8 | 69.2 | +0.9 | | ADR ($) | $186.14 | $188.91 | -1.5 | Balance Sheet, Liquidity, and Strategic Updates Sotherly reported $26.5 million cash and $315.8 million debt as of June 30, 2025, with a $17.75 million parking garage sale planned to reduce debt - As of June 30, 2025, the Company had approximately $26.5 million of available cash and cash equivalents, of which about $16.0 million was restricted[7] - Total outstanding debt principal was approximately $315.8 million with a weighted average interest rate of 5.89%[7] - The company has entered an agreement to sell the parking garage associated with the Georgian Terrace hotel in Atlanta for $17.75 million, expected to close in Q4 2025, with proceeds used to pay down the existing mortgage[6][8] Revised 2025 Outlook The company revised its full-year 2025 guidance downwards, anticipating lower revenues, a wider net loss, and reduced Hotel EBITDA and Adjusted FFO Revised Full-Year 2025 Guidance (Low Range) | Metric | Previous Guidance | Revised Guidance | Change (%) | | :--- | :--- | :--- | :--- | | Total Revenues ($k) | $183,388 | $185,157 | +1.0 | | Net Loss ($k) | $(676) | $(1,230) | -81.9 | | Hotel EBITDA ($k) | $48,829 | $45,340 | -7.1 | | Adj. FFO per Share ($) | $0.57 | $0.34 | -40.4 | | RevPAR ($) | $119.77 | $115.98 | -3.2 | Revised Full-Year 2025 Guidance (High Range) | Metric | Previous Guidance | Revised Guidance | Change (%) | | :--- | :--- | :--- | :--- | | Total Revenues ($k) | $188,168 | $188,168 | 0.0 | | Net Income/Loss ($k) | $129 | $(624) | -583.7 | | Hotel EBITDA ($k) | $49,619 | $45,821 | -7.7 | | Adj. FFO per Share ($) | $0.61 | $0.37 | -39.3 | | RevPAR ($) | $122.89 | $117.15 | -4.7 | Financial Tables This section presents detailed unaudited financial statements, including balance sheets, statements of operations, property operating metrics, and non-GAAP reconciliations Consolidated Balance Sheets As of June 30, 2025, total assets were $411.1 million, liabilities $366.8 million, and equity $44.3 million, reflecting minor shifts from year-end 2024 Balance Sheet Summary ($ in thousands) | Account | June 30, 2025 | Dec 31, 2024 | | :--- | :--- | :--- | | Total Assets ($) | $411,118 | $414,376 | | Total Liabilities ($) | $366,835 | $372,777 | | Total Equity ($) | $44,282 | $41,599 | Consolidated Statements of Operations For Q2 2025, total revenues were $48.8 million, net operating income $6.6 million, and the company reported a $0.4 million net loss Q2 Statement of Operations Summary ($ in thousands) | Account | Q2 2025 | Q2 2024 | | :--- | :--- | :--- | | Total Revenue ($) | $48,794 | $50,694 | | Total Hotel Operating Expenses ($) | $34,902 | $34,997 | | Net Operating Income ($) | $6,575 | $9,300 | | Net Income ($) | $1,556 | $4,664 | | Net (Loss) Income to Common Stockholders ($) | $(416) | $2,622 | Supplemental Data This section details individual hotel property operating metrics (Occupancy, ADR, RevPAR) for Q2 and YTD periods across 2023-2025, showing varied performance - The tables provide detailed Occupancy, ADR, and RevPAR data for each individual hotel property in the portfolio for Q2 and YTD across 2025, 2024, and 2023[26] Q2 2025 RevPAR Performance for Select Properties | Property | Q2 2025 RevPAR ($) | Q2 2024 RevPAR ($) | YoY Change (%) | | :--- | :--- | :--- | :--- | | The DeSoto, Savannah | $171.69 | $190.14 | -9.7 | | Hotel Ballast, Wilmington | $168.61 | $166.44 | +1.3 | | Hyatt Centric, Arlington | $191.89 | $198.42 | -3.3 | | Georgian Terrace, Atlanta | $92.99 | $109.51 | -15.1 | Reconciliation of Non-GAAP Measures This section provides detailed reconciliations of GAAP Net Income to non-GAAP measures like FFO, Adjusted FFO, EBITDA, and Hotel EBITDA Q2 2025 Reconciliation Summary ($ in thousands) | Metric | Q2 2025 | Q2 2024 | | :--- | :--- | :--- | | Net Income ($) | $1,556 | $4,664 | | FFO Attributable to Common Stockholders ($) | $4,317 | $7,356 | | Adjusted FFO Attributable to Common Stockholders ($) | $4,758 | $7,503 | | EBITDA ($) | $12,022 | $14,292 | | Hotel EBITDA ($) | $13,892 | $15,698 | - The company provides definitions for FFO, Adjusted FFO, EBITDA, and Hotel EBITDA, explaining them as key supplemental measures of performance used by industry analysts and investors[35][36][38]