INNSUITES HOSPITALITY TRUST

Previous wording

We do not undertake any obligation to update publicly or revise any forward-looking statements whether as a result of new information, future events or otherwise except as may be required by law. Pursuant to Section 21E(b)(2)(E) of the Securities Exchange Act of 1934, as amended, the qualifications set forth hereinabove are inapplicable to any forward-looking statements in this Form 10-K relating to the operations of the Partnership.

Current wording

We do not undertake any obligation to update publicly or revise any forward-looking statements whether as a result of new information, future events or otherwise except as may be required by law. Pursuant to Section 21E(b)(2)(E) of the Securities Exchange Act of 1934, as amended, the qualifications set forth hereinabove are inapplicable to any forward-looking statements in this Form 10-Q relating to the operations of the Partnership.

Previous wording

We expect the current Fiscal Year 2025 to be continued growth of the travel industry, stable high level Hotel occupancy, continued recovery and increases of room rates, as well as continuation of current cost control all leading to improved profitability of our hotels. We believe that we have positioned the Hotels to remain competitive through our now fully completed Tucson and Albuquerque hotel refurbishments, by offering fully refurbished studios and two-room suites at each location, and by maintaining complementary guest items, including complimentary hot breakfast and free Internet access.

Current wording

We expect the current Fiscal Year 2025 to be continued growth of the travel industry, stable high level Hotel occupancy, continued recovery and increases of room rates, as well as continuation of current cost control all leading to improved profitability of our hotels. We believe that we have positioned the Hotels to remain competitive through our completed Tucson and Albuquerque hotel refurbishments, by offering fully refurbished studios and two-room suites at each location, and by maintaining complementary guest items, including complimentary hot breakfast and free high speed Internet access.

Previous wording

Our strategic plan is to continue to obtain the full benefit of our real estate equity, by ultimately obtaining full market value for our two Hotels at market value, which is believed by management to be substantially higher than lower book values, over the next 12-36 months. In addition, the Trust is seeking a larger private reverse merger partner that may benefit from a merger that would afford that partner access to our listing on the NYSE AMERICAN.

Current wording

Our strategic plan is to continue to obtain the full benefit of our real estate equity, by ultimately obtaining full market value for our two Hotels at market value, which is believed by management to be substantially higher than lower book values, over the next 36 months. In addition, the Trust is seeking a larger private reverse merger partner that may benefit from a merger that would afford that partner access to our listing on the NYSE AMERICAN.

Previous wording

In the process of reviewing merger opportunities, the Trust identified in December 2019, and invested $1 million in UniGen Power, Inc. (“UniGen”), an innovative efficient clean energy power generation company. The Trust has invested $1 million in debentures convertible into 1 million shares of UniGen Power Inc., the Trust has invested in 575,000 UniGen shares, and in addition has acquired warrants to purchase approximately an additional up to 2 million UniGen shares over the next approximately three years, which could result in up to 20% or more ownership in UniGen. For more information on our strategic plan, including information on our progress in disposing of our hotel properties and expanding energy diversification, see “Future Positioning” in this Management Discussion and Analysis of Financial Condition and Results of Operations.

Current wording

In the process of reviewing merger opportunities, the Trust identified in December 2019, and invested $1 million in UniGen Power, Inc. (“UniGen”), an innovative efficient clean energy power generation company. The Trust has invested $1 million in debentures convertible into 1 million shares of UniGen Power Inc., the Trust has invested in 575,000 UniGen shares, and in addition has acquired warrants to purchase approximately an additional up to 2 million UniGen shares over the next approximately two years, which could result in up to 15-20% or more ownership in UniGen. For more information on our strategic plan, including information on our progress in disposing of our hotel properties and expanding energy diversification, see “Future Positioning” in this Management Discussion and Analysis of Financial Condition and Results of Operations.

Previous wording

For the three months ended July 31, 2024, we had total revenue of approximately $1.77 million compared to approximately $1.69 million for the three months ended July 31, 2023, an increase of approximately $0.01 million. In the prior fiscal years ended January 31, 2023, 2022 and 2020, we made significant improvements to our Albuquerque, New Mexico and Tucson, Arizona hotels. During the three months ended July 31, 2024, we had an increase in total revenue resulting from the recovery of demand after the virus related travel restrictions imposed due to COVID-19, and benefitting from prior refurbishments.

Current wording

For the nine months ended October 31, 2024, we had total revenue of approximately $5.96 million compared to approximately $5.754 million for the nine months ended October 31, 2023, an increase of approximately $0.2 million. In the prior Fiscal Years ended January 31, 2023, 2022 and 2021, we made significant improvements to our Albuquerque, New Mexico and Tucson, Arizona hotels. During the nine months ended October 31, 2024, we had an increase in total revenue resulting from the recovery of demand after the virus related travel restrictions imposed due to COVID-19, and benefitting from prior refurbishments.

Previous wording

Total Consolidated Net Loss for the six months ended July 31, 2024 was approximately $331,000 compared to Total Consolidated Net Income of approximately $532,000 for the six months ended July 31, 2023, a decrease of approximately $863,000. Earnings Per Share based on this Consolidated Net Loss amount were ($0.04), down $0.10 from the prior year of $0.06, which is a decrease of 164%. Earnings Per Share based on net loss attributable to Controlling Interest was ($0.06), down $0.09 from the prior year of $0.03, which is a decrease of 301%.

Current wording

Total Consolidated Net Loss for the nine months ended October 31, 2024 was approximately ($557,000), compared to Consolidated Net Income of approximately $612,000 for the nine months ended October 31, 2023, a decrease of approximately $1,168,000. Loss Per Share based on this Consolidated Net Loss amount was ($0.06), down $0.13 from the prior year Income Per Share of $0.07, which is a decrease of 194%. Loss Per Share based on net loss attributable to Controlling Interest was ($0.09), down from the prior year net income per share of $0.03.

Previous wording

Total Trust Equity decreased to approximately $1,959,000 at the end of Fiscal Second Quarter 2024, down approximately $1.6 million, from the approximately $3,574,000 reported at the end of the first 6 months in the prior fiscal year 2023. Net Loss before non-cash depreciation expense was approximately $181,000 for the six months ended July 31 2024, compared to Net Income before non-cash depreciation expense of approximately $580,000 for the six months ended July 31, 2023, which is an decrease of approximately $762,000.

Current wording

Total Trust Equity decreased to approximately $1,651,000 at the end of the nine months in the current Fiscal Year 2024, down approximately $1.6 million, from approximately $3,259,000 reported at the end of the nine months in the prior Fiscal Year 2024. Net loss before non-cash depreciation expense was approximately $43,000 for the nine months ended October 31, 2024, compared to net income before non-cash depreciation of expense of approximately $257,000 for the nine months ended October 31, 2023, which is a decrease of approximately $300,000.

Previous wording

We realized a 5% increase in room revenues during the three months ended July 31, 2024 as room revenues were approximately $1.77 million for the three months ending July 31, 2024 as compared to approximately $1.69 million for the three months ending July 31, 2023. During Fiscal Year 2024, we expect additional improvements in occupancy, modest improvements in rates and steady food and beverage revenues.

Current wording

We realized a 2% increase in room revenues during the nine months ended October 31, 2024, as room revenues were approximately $5.76 million for the nine months ending October 31, 2024 as compared to approximately $5.64 million for the nine months ending October 31, 2023. During Fiscal Year 2024, we expect modest additional improvements in occupancy, rates, and food and beverage revenues.

Previous wording

Total expenses net of interest expense was approximately $4.25 million for the six months ended July 31, 2024 reflecting an increase of approximately $0.35 million, or 9%, compared to total expenses net of interest expense of approximately $3.90 million for the six months ended July 31, 2023. The increase was primarily due to an increase in operating expenses related to increased occupancy and revenues at the hotel properties.

Current wording

Total expenses net of interest expense was approximately $6.21 million for the nine months ended October 31, 2024, reflecting an increase of approximately $0.33 million, or 6%, compared to total expenses net of interest expense of approximately $5.88 million for the nine months ended October 31, 2023. The increase was primarily due to an increase in operating expenses related to higher costs at the hotel properties.

Previous wording

Room expenses consisting of salaries and related employment taxes for property management, front office, housekeeping personnel, reservation fees and room supplies were approximately $1.36 million for the six months ended July 31, 2024 compared to approximately $1.26 million in the prior year six month period for an increase of approximately $104,000, or 8%. Room expenses increased as occupancy at the hotels increased, and increased expenses were incurred with the increased occupancy.

Current wording

Room expenses consisting of salaries and related employment taxes for property management, front office, housekeeping personnel, reservation fees and room supplies were approximately $1.93 million for the nine months ended October 31, 2024, compared to approximately $1.87 million in the prior year nine month period for an increase of approximately $69,000, or 4%. Room expenses increased as occupancy at the hotels increased, and increased expenses were incurred with the increased occupancy.

Previous wording

Food and beverage expenses included food and beverage costs, personnel and miscellaneous costs to provide banquet events. For the six months ended July 31, 2024, food and beverage expenses decreased approximately $42,000, or 45%, to approximately $51,000 for the six months ended July 31, 2024, compared to approximately $93,000 for the six months ended July 31, 2023. The decrease in cost is due to the careful management of food and beverage purchasing costs.

Current wording

Food and beverage expenses included food and beverage costs, personnel, and miscellaneous costs to provide banquet events. For the nine months ended October 31, 2024, food and beverage expenses decreased approximately $67,000, or 48%, to approximately $72,000 for the nine months ended October 31, 2024, compared to approximately $139,000 for the nine months ended October 31, 2023. The decrease in cost is due to keeping a tight control on food and beverage expenses.

Previous wording

General and administrative expenses include overhead charges for management, accounting, shareholder and legal services. General and administrative expenses of approximately $1.12 million for the six months ended July 31, 2024, decreased approximately $98,000 from approximately $1.22 million for the six months ended July 31, 2023 primarily due to cost cuts in corporate staffing in support of the hotels and property sales efforts.

Current wording

General and administrative expenses include overhead charges for management, accounting, shareholder and legal services. General and administrative expenses of approximately $1.66 million for the nine months ended October 31, 2024, increased approximately $113,000 from approximately $1.77 million for the nine months ended October 31, 2023, primarily due to less charges in corporate staffing in support of the hotels and property sales efforts.

Previous wording

Sales and marketing expense increased approximately $52,000, or 26%, to approximately $250,000 for the six months ended July 31, 2024 from approximately $198,000 for the six months ended July 31, 2023. Increased focus on sales and marketing due to the rebound in hotel occupancy drove the increase.

Current wording

Sales and marketing expense increased approximately $55,000, or 19%, to approximately $349,000 for the nine months ended October 31, 2024, from approximately $294,000 for the nine months ended October 31, 2023. Increased focus on sales and marketing due to the rebound in hotel occupancy drove the increase.

Previous wording

Repairs and maintenance expense remained relatively flat from approximately $215,000 reported for the six months ended July 31, 2024 compared to approximately $211,000 for the six months ended July 31, 2024. Having completed the property improvements at our Tucson, Arizona hotel Management anticipates the improvements which complies with the increasing Best Western standards, will (after the adverse effects of travel restrictions and slowdown), lead to improvement in guest satisfaction and will drive additional revenue growth through increased occupancy and increased rates.

Current wording

Repairs and maintenance expense decreased from approximately $338,000 reported for the nine months ended October 31, 2023, compared to approximately $313,000 for the nine months ended October 31, 2024. Having completed the property improvements at our Tucson, Arizona hotel Management anticipates the improvements which complies with the increasing Best Western standards, will (after the adverse effects of travel restrictions and slowdown), lead to improvement in guest satisfaction and will drive additional revenue growth through increased occupancy and increased rates.

Previous wording

Hotel property depreciation expenses increased by approximately $11,000 from approximately $335,000 reported for the six months ended July 31, 2023 compared to approximately $346,000 for the six months ended July 31, 2024. Increased depreciation resulted from additional capital expenditures.

Current wording

Hotel property non-cash depreciation expenses increased by approximately $19,000 from approximately $502,000 reported for the nine months ended October 31, 2023, compared to approximately $521,000 for the nine months ended October 31, 2024. Increased depreciation resulted from additional capital expenditures being depreciated.

Previous wording

Real estate and personal property taxes, Insurance and Ground Rent expenses increased approximately $249,000, or 215%, to approximately $364,000 reported for the six months ended July 31, 2024 compared with approximately $116,000 for the six months ended July 31, 2023 due to adjustments in our operating lease accounts.

Current wording

Real estate and personal property taxes, Insurance and Ground Rent expenses increased approximately $297,000, or 107%, to approximately $575,000 reported for the nine months ended October 31, 2024 compared with approximately $278,000 for the nine months ended October 31, 2023 due to adjustments in our operating lease accounts.

Previous wording

For the six months ended July 31, 2024, we had total revenue of approximately $4.01 million compared to approximately $3.65 million for the six months ended July 31, 2024, an increase of approximately $0.1 million. In the prior fiscal years ended January 31, 2024, 2020 and 2019, we made significant improvements to our Albuquerque, New Mexico and Tucson, Arizona hotels. During the six months ended July 31, 2024, we had an increase in total revenue resulting from the recovery of demand, and benefitting from prior refurbishments.

Current wording

For the three months ended October 31, 2024, we had total revenue of approximately $1.82 million, which is relatively flat compared to approximately $1.82 million for the three months ended October 31, 2023. In the prior fiscal years ended January 31, 2023, 2022 and 2021, we made significant improvements to our Albuquerque, New Mexico and Tucson, Arizona hotels. During the three months ended October 31, 2024, we had an increase in total revenue resulting from the recovery of demand after the virus related travel restrictions imposed due to COVID-19, and benefitting from prior refurbishments.

Previous wording

Total Consolidated Net Loss for the three months ended July 31, 2024 was approximately $410,000 compared to Total Consolidated Net Income of approximately $76,000 for the three months ended July 31, 2023, a decrease of approximately $486,000. Earnings Per Share based on this Consolidated Net Loss amount were $0.04, down $0.04 from the prior year of $0.00. Earnings Per Share based on net loss attributable to Controlling Interest was $0.04, down from the prior year similar three month period of $0.00.

Current wording

Total Consolidated Net Loss for the three months ended October 31, 2024 was approximately ($217,000), compared to Consolidated Net Income of approximately $90,000 for the three months ended October 31, 2023, a decrease of approximately $307,000. Earnings Per Share based on this Consolidated Net Loss were down ($0.02) compared to the prior year similar three month period of $0.01. Earnings Per Share based on net loss attributable to Controlling Interest was ($0.03), down ($0.04) compared to the prior year similar three month period of $0.01.

Previous wording

Net Loss before non-cash depreciation expense was approximately $237,000 for the three months ended July 31 2024, compared to Net Income before non-cash depreciation expense of approximately $243,000 for the three months ended July 31, 2023, which is a decrease of approximately $480,000.

Current wording

Net Loss before non-cash depreciation expense was approximately $43,000 for the three months ended October 31, 2024, compared to Net Income before non-cash depreciation expense of approximately $257,000 for the three months ended October 31, 2023, which is a decrease of approximately $300,000.

Previous wording

We realized a 4% increase in room revenues during the six months ended July 31, 2024 as room revenues were approximately $4.01 million for the six months ending July 31, 2024 as compared to approximately $3.86 million for the six months ending July 31, 2023. During Fiscal Year 2025, we expect additional modest improvements in hotel occupancy, and modest improvements in hotel rates.

Current wording

Room revenue remained relatively flat during the three months ended October 31, 2024 as room revenues were approximately $1.76 million for the three months ending October 31, 2024 as compared to approximately $1.78 million for the three months ending October 31, 2023. During Fiscal Year 2024.

Previous wording

Total expenses net of interest expense was approximately $2.13 million for the three months ended July 31, 2024 reflecting a increase of approximately $0.26 million, or 14%, compared to total expenses net of interest expense of approximately $1.87 million for the three months ended July 31, 2023.

Current wording

Total expenses net of interest expense was approximately $1.95 million for the three months ended October 31, 2024 remaining relatively flat compared to total expenses net of interest expense of approximately $1.97 million for the three months ended October 31, 2023.

Previous wording

Room expenses consisting of salaries and related employment taxes for property management, front office, housekeeping personnel, reservation fees and room supplies were approximately $700,000 for the three months ended July 31, 2024 compared to approximately $631,000 in the prior year three month period for an increase of approximately $69,000, or 11%. Room expenses increased as occupancy at the hotels increased, and increased expenses were incurred with the increased occupancy.

Current wording

Room expenses consisting of salaries and related employment taxes for property management, front office, housekeeping personnel, reservation fees and room supplies were approximately $570,000 for the three months ended October 31, 2024 compared to approximately $605,000 in the prior year three month period for an decrease of approximately $35,000, or 6%. Room expenses decreased as occupancy at the hotels slight decreased, and decreased expenses were incurred with the slight decreased occupancy.

Previous wording

Food and beverage expenses included food and beverage costs, personnel and miscellaneous costs to provide banquet events. For the three months ended July 31, 2024, food and beverage expenses decreased approximately $22,000, or 49%, to approximately $23,000 for the three months ended July 31, 2024, compared to approximately $45,000 for the three months ended July 31, 2023.

Current wording

Food and beverage expenses included food and beverage costs, personnel and miscellaneous costs to provide banquet events. For the three months ended October 31, 2024, food and beverage expenses were approximately $20,000 for the three months ended October 31, 2024, compared to approximately $45,000 for the three months ended October 31, 2023.

Previous wording

General and administrative expenses include overhead charges for management, accounting, shareholder and legal services. General and administrative expenses of approximately $519,000 for the three months ended July 31, 2024, decreased approximately $85,000 from approximately $604,000 for the three months ended July 31, 2023 primarily due to cuts charges in corporate staffing in support of the hotels and property sales efforts.

Current wording

General and administrative expenses include overhead charges for management, accounting, shareholder and legal services. General and administrative expenses of approximately $536,000 for the three months ended October 31, 2024, decreased approximately $15,000 from approximately $551,000 for the three months ended October 31, 2023 primarily due to savings initiatives at corporate staffing in support of the hotels and property sales efforts.

Previous wording

Sales and marketing expense increased approximately $34,000, or 34%, to approximately $135,000 for the three months ended July 31, 2024 from approximately $101,000 for the three months ended July 31, 2023.

Current wording

Sales and marketing expense remained relatively flat at approximately $99,000 for the three months ended October 31, 2024 from approximately $96,000 for the three months ended October 31, 2023.

Previous wording

Repairs and maintenance expense increased from approximately $95,000 reported for the three months ended July 31, 2023 compared to approximately $110,000 for the three months ended July 31, 2024. Having completed the property improvements at our Tucson, Arizona hotel Management anticipates the improvements which complies with the increasing Best Western standards, will (after the adverse effects of travel restrictions and slowdown), lead to improvement in guest satisfaction and will drive additional revenue growth through increased occupancy and increased rates.

Current wording

Repairs and maintenance expense decreased from approximately $127,000 reported for the three months ended October 31, 2023 compared to approximately $98,000 for the three months ended October 31, 2024. Having completed the property improvements at our Tucson, Arizona hotel Management anticipates the improvements which complies with the increasing Best Western standards, will (after the adverse effects of travel restrictions and slowdown), lead to improvement in guest satisfaction and will drive additional revenue growth through increased occupancy and increased rates.

Previous wording

Hotel property depreciation expenses increased by approximately $6,000 from approximately $167,000 reported for the three months ended July 31, 2023 compared to approximately $173,000 for the three months ended July 31, 2024. Increased depreciation resulted from additional capital expenditures.

Current wording

Hotel property depreciation expenses increased by approximately $7,000 from approximately $167,000 reported for the three months ended October 31, 2023 compared to approximately $174,000 for the three months ended October 31, 2024. Increased depreciation resulted from an increase in depreciation for additional capital expenditures.

Previous wording

Real estate and personal property taxes, Insurance and Ground Rent expenses increased approximately $200,000, or 100%, to approximately $202,000 reported for the three months ended July 31, 2024 compared with approximately $2,000 for the three months ended July 31, 2023 due to adjustments in our operating lease accounts.

Current wording

Real estate and personal property taxes, Insurance and Ground Rent expenses increased approximately $48,000, or 29%, to approximately $175,000 reported for the three months ended October 31, 2024 compared with approximately $167,000 for the three months ended October 31, 2023 due to adjustments in our operating lease accounts.

Previous wording

Hotel operations were positively affected by improved occupancy and substantially increased room rates at the Hotels in the Fiscal Year 2024, and the First Two Fiscal Quarters of Fiscal 2025, ended July 31, 2024, as the travel industry continued to rebound.

Current wording

Hotel operations were positively affected by improved occupancy and substantially increased room rates at the Hotels in the Fiscal Year 2024, and to a lesser extent, the First Three Fiscal Quarters of Fiscal 2025, ended October 31, 2024, as the travel industry continued to thrive.

Previous wording

With approximately $0.4 million of cash as of July 31, 2024 and the availability of three $250,000 bank lines of credit, and $2,000,000 available from the $2,000,000 related party Demand/Revolving Line of Credit/Promissory Note, and the availability of Advances to Affiliate credit facilities and available Bank line of Credit, we believe that we will have enough cash on hand to meet all of our financial obligations as they become due for at least the next twelve months from the issuance date of the these consolidated financial statements. Our management is analyzing other strategic options available to us, including raising additional funds, asset sales, and benefitting from clean energy investment cash flow as our diversification investment matures. However, such transactions may not be available on terms that are favorable to us, or at all.

Current wording

With approximately $0.5 million of cash as of October 31, 2024 and the availability of three $250,000 bank lines of credit, and $1,200,000 available from the $2,000,000 related party Demand/Revolving Line of Credit/Promissory Note, and the availability of Advances to Affiliate credit facilities and available Bank line of Credit, we believe that we will have enough cash on hand to meet all of our financial obligations as they become due for at least the next twelve months from the issuance date of the these consolidated financial statements. Our management is analyzing other strategic options available to us, including raising additional funds, asset sales, and benefiting from clean energy investment cash flow as our diversification investment progresses. However, such transactions may not be available on terms that are favorable to us, or at all.

Previous wording

IHT and InnDependent Boutique Collections Hotels (IBC), previously agreed to extend the payment schedule on IBC’s note receivable to allow IBC to fully use its available cash and/or revenues to rebuild market share as the hotel industry rebounds. Management believes that with an additional extension repayment term, that the future collectability of the current carrying value of the note is probable and not subject to further impairment, or allowance for the Quarter ended July 31, 2024.

Current wording

IHT and InnDependent Boutique Collections Hotels (IBC), previously agreed to extend the payment schedule on IBC’s note receivable to allow IBC to rebuild operations as the hotel industry rebounds. Management believes that with an additional extension repayment term, that the future collectability of the current carrying value of the note is probable and not subject to further impairment, or allowance for the Quarter ended October 31, 2024.

Previous wording

We anticipate steady leisure travel demand, and limited additional new-build hotel supply in our markets during the current Fiscal Year 2025, and accordingly we anticipate a continued increase of revenues. We expect challenges for the remaining Fiscal Year to be the economy, inflation, and cost control. Travel, leisure, corporate, group, and government business continued to grow and may further increase room rates while maintaining and/or building market share in Fiscal Year 2025.

Current wording

We anticipate steady leisure travel demand, modestly increased hotel rates, and limited additional new-build hotel supply in our markets during the current Fiscal Year 2025, and accordingly we anticipate a continued increase of revenues. We expect challenges for the remaining Fiscal Year to be the economy, inflation, and cost control. Travel, leisure, corporate, group, and government business continued to grow and may further increase room rates while maintaining and/or building market share in Fiscal Year 2025.

Previous wording

Cash used in operating activities from continuing operations totaled approximately $504,000 during the six months ended July 31, 2024 as compared to net cash provided of approximately $1,439,000 during the six months ended July 31, 2023. Consolidated net loss was approximately $331,000 for the six months ended July 31, 2024 as compared to consolidated net income for the six months ended July 31, 2023 of approximately $532,000. Explanation of the differences between these fiscal years are explained above in the results of operations of the Trust.

Current wording

Cash used in operating activities totaled approximately $651,000 during the nine months ended October 31, 2024 as compared to net cash provided of approximately $1,511,000 during the nine months ended October 31, 2023. Consolidated net loss was approximately $557,000 for the nine months ended October 31, 2024 as compared to consolidated net income for the nine months ended October 31, 2023 of approximately $612,000. Explanation of the differences between these Fiscal Years are explained above in the results of operations of the Trust.

Previous wording

Changes in the adjustments to reconcile net income for the six months ended July 31, 2024 and 2023, respectively, consist primarily of operating lease costs, stock-based compensation, hotel property depreciation, and changes in assets and liabilities. Hotel property depreciation was approximately $346,000 during the six months ended July 31, 2024 compared to approximately $335,000 during the six months ended July 31, 2023, an increase of $11,000 as the Trust recognized additional depreciation due to capital expenditures.

Current wording

Changes in the adjustments to reconcile net income for the nine months ended October 31, 2024 and 2022, respectively, consist primarily of operating lease costs, stock-based compensation, hotel property depreciation, and changes in assets and liabilities. Hotel property non-cash depreciation was approximately $521,000 during the nine months ended October 31, 2024 compared to approximately $502,000 during the nine months ended October 31, 2023, a increase of $19,000 as the Trust recognized more depreciation for the increase of additional capitalized fixed assets.

Previous wording

Changes in assets and liabilities for accounts receivable, prepaid expenses and other assets and accounts payable and accrued expenses totaled approximately ($519,000) and ($574,000) for the six months ended July 31, 2024 and 2023, respectively. This significant decrease in changes in assets and liabilities for the six months ended July 31, 2024 compared to the six months ended July 31, 2023 was due to the decrease in operating liabilities related to ongoing operations.

Current wording

Changes in assets and liabilities for accounts receivable, prepaid expenses and other assets and accounts payable and accrued expenses totaled approximately ($615,000) and ($497,000) for the nine months ended October 31, 2024 and 2022, respectively. This significant decrease in changes in assets and liabilities for the nine months ended October 31, 2024 compared to the nine months ended October 31, 2023 was due to the decrease in operating liabilities related to ongoing operations.

Previous wording

Net cash used in investing activities totaled approximately $287,000 for the six months ended July 31, 2024 compared to net cash used in investing activities of approximately $277,000 for the six months ended July 31, 2023. The increase in net cash used in activities during the six months ended July 31, 2024 was due primarily due to improvements and additions to the hotel properties.

Current wording

Net cash used in investing activities totaled approximately $368,000 for the nine months ended October 31, 2024 compared to net cash used in investing activities of approximately $390,000 for the nine months ended October 31, 2023. The decrease in net cash used in activities during the nine months ended October 31, 2024 was due primarily due to less capital improvements to our Hotel Properties as the Trust watched costs and cash flows.

Previous wording

Net cash used in financing activities totaled approximately ($116,000) and ($874,000), respectively, for the six months ended July 31, 2024 and 2023. The decrease of approximately ($758,000) was primarily due to borrowing on Notes Payable – Related Party.

Current wording

Net cash provided by (used in) financing activities totaled approximately $145,000 and ($1,328,000), respectively, for the nine months ended October 31, 2024 and 2023. The increase of approximately $1,473,000 was primarily due to borrowing on the Notes Payable Related Party.

Previous wording

Principal payments on mortgage notes payable for continuing operations was approximately $117,000 and $112,000 during the six months ended July 31, 2024 and 2023, respectively.

Current wording

Principal payments on mortgage notes payable for continuing operations was approximately $157,000 and $169,000 during the nine months ended October 31, 2024 and 2023, respectively.

Previous wording

Payments on notes payables–related party, netted against borrowings on note payable–related party, was approximately $365,000 and ($100,000) of cash used in financing activities during the six months ended July 31, 2024 and 2023, respectively.

Current wording

Borrowing and payments on notes payables–related party, netted against borrowings on note payable–related party, was approximately $750,000 and ($100,000) of cash used in financing activities during the nine months ended October 31, 2024 and 2023, respectively.

Previous wording

During the six months ended July 31, 2024, our distributions to non-controlling interest holders was approximately $229,000 compared with approximately $346,000 for the six months ended July 31, 2023.

Current wording

During the nine months ended October 31, 2024, our distributions to non-controlling interest holders was approximately $312,000 compared with approximately $569,000 for the nine months ended October 31, 2023.