Service Properties Trust (SVC) investor relations material

Executive summary

• Second quarter 2026 results reflect continued momentum in advancing strategic priorities, with Normalized FFO of $55.0 million ($0.43/share), Adjusted EBITDAre of $145.8 million, and a net loss of $223.8 million due to $189.1 million asset impairment on hotels held for sale.

• The company owns 838 properties, including 745 net lease properties and 93 hotels, focusing on reducing debt, enhancing the net lease portfolio, and improving retained hotel performance.

• Net lease portfolio and retained hotels outperformed industry benchmarks, with RevPAR up 6.6% year-over-year and steady NOI growth.

• Raised $541.8 million in equity, redeemed $550 million in unsecured debt, and completed a 1-for-5 reverse share split in July 2026.

• Strategic focus remains on disciplined capital allocation, asset sales, and operational improvements.

Financial highlights

• Q2 2026 total revenues were $420.97 million, down 16.4% year-over-year, primarily due to hotel asset sales.

• Normalized FFO was $55.0 million ($0.43/share), down from $57.6 million in Q2 2025; Adjusted EBITDAre was $145.8 million.

• Net lease NOI increased $1.3 million year-over-year to $94.9 million, with occupancy steady at 96.6%.

• Retained hotel portfolio RevPAR increased 6.6% to $134.53; adjusted hotel EBITDA rose 4.2% to $56.9 million.

• Cash flow available for distribution was $42.5 million for the quarter.

Outlook and guidance

• Full-year 2026 Normalized FFO guidance reaffirmed at $124–$144 million ($1.20–$1.35/share), with Adjusted EBITDAre guidance of $500–$520 million.

• Hotel EBITDA, net lease NOI, and consolidated Adjusted EBITDAre guidance maintained; CapEx expected at $120–$140 million.

• Management expects continued pressure from inflation, labor costs, and macroeconomic uncertainty, but plans to continue asset sales, debt reduction, and capital improvements.

• Pending sales of 12–15 hotels for $77.4–$98.4 million and additional net lease acquisitions are expected.