Sotherly Hotels Inc. Reports Financial Results for the Second Quarter Ended June 30, 2025

Core Viewpoint - Sotherly Hotels Inc. reported a decline in financial performance for the second quarter of 2025, with decreases in total revenues, net income, and key operating metrics such as RevPAR and EBITDA, reflecting broader macroeconomic challenges impacting hotel demand [1][3][5]. Financial Performance - Total revenues for Q2 2025 were approximately $48.8 million, down from $50.7 million in Q2 2024 [2][7]. - Net income attributable to common stockholders decreased from approximately $2.6 million in Q2 2024 to a loss of approximately $0.4 million in Q2 2025 [7]. - EBITDA for Q2 2025 was approximately $12.0 million, compared to $14.3 million in Q2 2024 [7]. Key Operating Metrics - RevPAR for the composite portfolio decreased by 5.4% to $130.20 in Q2 2025 from $137.67 in Q2 2024, driven by a 3.5% decrease in occupancy and a 1.9% decrease in average daily rate (ADR) [2][22]. - Occupancy rates for the composite portfolio were 70.8% in Q2 2025, down from 73.4% in Q2 2024 [22]. - ADR decreased to $183.88 in Q2 2025 from $187.51 in Q2 2024 [22]. Balance Sheet and Liquidity - As of June 30, 2025, the company had approximately $26.5 million in available cash, with $16.0 million reserved for various expenses [5]. - The company had outstanding debt of approximately $315.8 million at a weighted average interest rate of 5.89% [5]. Strategic Initiatives - The company is working on extending certain mortgages and refinancing hotels with significant equity to improve liquidity [4][5]. - A prospective sale of a parking garage in Atlanta for $17.75 million is expected to close in Q4 2025, which will provide additional liquidity [6][8]. Outlook - The company updated its 2025 guidance, projecting total revenues between $185.2 million and $188.2 million, with a net loss attributable to common stockholders ranging from $9.2 million to $8.6 million [9]. - The company remains cautious about demand in the lodging market, citing macroeconomic factors as potential catalysts for future improvement [5].