RLJ Lodging Trust (RLJ) Q2 2024 earnings summary

Executive summary

• Q2 2024 RevPAR rose 2.6% year-over-year to $157.30, with total revenue up 3.5% to $371.0M, driven by gains in both occupancy and ADR, especially in urban and top 25 markets.

• Net income for Q2 2024 was $37.3M, down from $41.7M in Q2 2023, primarily due to higher operating and interest expenses.

• Acquired Hotel Teatro in Denver for $35.5M and Wyndham Boston Beacon Hill for $125M, and sold Residence Inn Merrillville for $8.1M as part of portfolio optimization.

• Launched a $250M share repurchase program, repurchased 0.5M shares for $5M, and increased quarterly dividend to $0.15 per share starting Q3 2024.

• Operates 96 hotels with 21,290 rooms as of June 30, 2024, with a market capitalization of $1.5B and total enterprise value of $3.7B.

Financial highlights

• Q2 2024 total revenue was $371.0M, up from $358.9M in Q2 2023; room revenue was $303.7M and food and beverage revenue was $40.8M.

• Q2 occupancy was 76.7%, ADR was $205.20, and RevPAR was $157.30, all up year-over-year.

• Hotel EBITDA reached $118.6M with a 32% margin; Adjusted EBITDA was $109.0M; Adjusted FFO per diluted share was $0.51.

• Net income margin for Q2 2024 was 10.1%.

• Liquidity at quarter-end was $771.1M, with $2.2B in debt and $400M available under the revolver.

Outlook and guidance

• FY 2024 comparable RevPAR growth expected between 1.0% and 2.5%.

• Comparable hotel EBITDA projected at $382.5M–$402.5M; Adjusted FFO per diluted share between $1.45 and $1.58.

• Capital expenditures for 2024 estimated at $100M–$120M; net interest expense at $93M–$95M.

• Guidance reflects continued normalization in leisure ADR and assumes no further acquisitions or dispositions.

• Management continues to focus on enhancing portfolio quality, capital recycling, and prudent capital structure.