RLJ Lodging Trust

Previous wording

The following information contains certain statements, other than purely historical information, including estimates, projections, statements relating to our business plans, objectives and expected operating results, and the assumptions upon which those statements are based, that are "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933, as amended (the "Securities Act") and Section 21E of the Securities Exchange Act of 1934, as amended (the "Exchange Act"). These forward-looking statements generally are identified by the use of the words "believe," "project," "expect," "anticipate," "estimate," "plan," "may," "will," "will continue," "intend,"

Current wording

The following information contains certain statements, other than purely historical information, including estimates, projections, statements relating to our business plans, objectives and expected operating results, and the assumptions upon which those statements are based, that are "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933, as amended (the "Securities Act") and Section 21E of the Securities Exchange Act of 1934, as amended (the "Exchange Act"). These forward-looking statements generally are identified by the use of the words "believe," "project," "expect," "anticipate," "estimate," "plan," "may," "will," "will continue," "intend," "should," or similar expressions. Although we believe that the expectations reflected in such forward-looking statements are based upon reasonable assumptions, beliefs and expectations, such forward-looking statements are not predictions of future events or guarantees of future performance and our actual results could differ materially from those set forth in the forward-looking statements.

Previous wording

As of September 30, 2024, we owned 96 hotel properties with approximately 21,300 rooms, located in 23 states and the District of Columbia. We owned, through wholly-owned subsidiaries, a 100% interest in 94 of our hotel properties, a 95% controlling interest in one hotel property, and a 50% non-controlling interest in an entity owning one hotel property. We consolidate our real estate interests in the 95 hotel properties in which we hold a controlling interest, and we record the real estate interest in the one hotel property in which we hold an indirect 50% non-controlling interest using the equity method of accounting. We lease 95 of the 96 hotel properties to our TRSs, of which we own a controlling financial interest.

Current wording

As of March 31, 2025, we owned 95 hotel properties with approximately 21,200 rooms, located in 23 states and the District of Columbia. We owned, through wholly-owned subsidiaries, a 100% interest in 93 of our hotel properties, a 95% controlling interest in one hotel property, and a 50% non-controlling interest in an entity owning one hotel property. We consolidate our real estate interests in the 94 hotel properties in which we hold a controlling interest, and we record the real estate interest in the one hotel property in which we hold an indirect 50% non-controlling interest using the equity method of accounting. We lease 94 of the 95 hotel properties to our TRSs, of which we own a controlling financial interest.

Previous wording

•Exercised one-year extension options on $181.0 million in mortgage loans to extend the maturities to April 2025.

Current wording

•Exercised the final one-year extension options on $181.0 million in mortgage loans to extend the maturities to April 2026.

Previous wording

•Repurchased and retired approximately 2.3 million common shares for approximately $22.0 million.

Current wording

•Repurchased and retired approximately 2.7 million common shares for approximately $24.3 million.

Previous wording

We also use non-GAAP measures such as FFO, Adjusted FFO, EBITDA, EBITDAre and Adjusted EBITDA to evaluate the operating performance of our business. For a more in depth discussion of the non-GAAP measures, please refer to the "Non-GAAP Financial Measures" section.

Current wording

We also use non-GAAP measures such as FFO, Adjusted FFO, EBITDA, EBITDAre and Adjusted EBITDA to evaluate the operating performance of our business. For a more in depth discussion of these non-GAAP measures, please refer to the "Non-GAAP Financial Measures" section. In addition, we use Hotel EBITDA, a non-GAAP financial measure, to assess operating performance. For a more in depth discussion of Hotel EBITDA, please refer to Note 15, Segment Information, to the consolidated financial statements included elsewhere in this Quarterly Report on Form 10-Q.

Previous wording

At September 30, 2024 and 2023, we owned 96 and 97 hotel properties, respectively. Based on when a hotel property is acquired or sold, the operating results for certain hotel properties are not comparable for the three and nine months ended September 30, 2024 and 2023. The non-comparable properties include two hotel properties that were sold and one hotel property that was acquired in 2024.

Current wording

At March 31, 2025 and 2024, we owned 95 and 97 hotel properties, respectively. Based on when a hotel property is acquired or sold, the operating results for certain hotel properties are not comparable for the three months ended March 31, 2025 and 2024. The non-comparable properties include three hotel properties that were sold in 2025 and 2024 and one hotel property that was acquired in 2024.

Previous wording

Food and beverage revenue increased $7.9 million to $113.5 million for the nine months ended September 30, 2024 from $105.6 million for the nine months ended September 30, 2023. The increase in food and beverage revenue was primarily due to increases in outlet revenue and banquet and catering revenue.

Current wording

Food and beverage revenue increased $1.8 million to $37.5 million for the three months ended March 31, 2025 from $35.7 million for the three months ended March 31, 2024. The increase in food and beverage revenue was primarily due to increases in outlet revenue and banquet and catering revenue.

Previous wording

Other revenue increased $2.0 million to $25.1 million for the three months ended September 30, 2024 from $23.1 million for the three months ended September 30, 2023. The increase in other revenue was primarily due to an increase in parking and resort fees.

Current wording

Other revenue increased $0.9 million to $23.0 million for the three months ended March 31, 2025 from $22.1 million for the three months ended March 31, 2024. The increase in other revenue was primarily due to an increase in parking, resort and cancellation fees.

Previous wording

Property operating expenses increased $10.1 million to $223.6 million for the three months ended September 30, 2024 from $213.5 million for the three months ended September 30, 2023. The increase was due to a $9.2 million increase in property operating expenses from the comparable properties.

Current wording

Property operating expenses increased $3.6 million to $217.1 million for the three months ended March 31, 2025 from $213.5 million for the three months ended March 31, 2024. The increase was due to a $3.9 million increase in property operating expenses from the comparable properties.

Previous wording

The increase in property operating expenses from the comparable properties was primarily due to increases in wages and benefits, as well as increases in room and food and beverage expenses, and increases in other operating expenses, primarily due to increases in sales and marketing, utilities, and administrative expenses.

Current wording

The increase in property operating expenses from the comparable properties was primarily due to increases in wages and benefits, and increases in other operating expenses, primarily due to increases in sales and marketing, utilities, and general liability insurance coverage.

Previous wording

Property tax, insurance and other expense decreased $2.8 million to $24.2 million for the three months ended September 30, 2024 from $26.9 million for the three months ended September 30, 2023. The decrease was primarily attributable to the beneficial impact of successful real estate tax appeals in the current quarter, partially offset by increases in insurance premiums.

Current wording

Property tax, insurance and other expense decreased $0.6 million to $27.2 million for the three months ended March 31, 2025 from $27.8 million for the three months ended March 31, 2024. The decrease was primarily attributable to the impact of successful real estate tax appeals in the current period.

Previous wording

General and administrative expense decreased $2.0 million to $12.8 million for the three months ended September 30, 2024 from $14.7 million for the three months ended September 30, 2023. The decrease was primarily attributable to a decrease in non-cash compensation expense.

Current wording

General and administrative expense decreased $2.5 million to $12.6 million for the three months ended March 31, 2025 from $15.1 million for the three months ended March 31, 2024. The decrease was primarily attributable to a decrease in non-cash compensation expense.

Previous wording

Other income, net decreased $1.1 million to $0.8 million for the three months ended September 30, 2024 from $1.9 million for the three months ended September 30, 2023. The decrease was primarily attributable to the receipt of certain COVID-19 relief awards during the three months ended September 30, 2023.

Current wording

Other income, net decreased $2.3 million to $0.9 million for the three months ended March 31, 2025 from $3.2 million for the three months ended March 31, 2024. The decrease was primarily attributable to the receipt of certain one-time COVID-19 relief awards during the three months ended March 31, 2024.

Previous wording

Interest expense increased $3.8 million to $28.6 million for the three months ended September 30, 2024 from $24.8 million for the three months ended September 30, 2023. The increase was attributable to higher interest rates on our unhedged variable rate debt combined with an increase in the amount of debt that was unhedged. The components of our interest expense for the three months ended September 30, 2024 and 2023 were as follows (in thousands):

Current wording

Interest expense increased $1.1 million to $27.6 million for the three months ended March 31, 2025 from $26.5 million for the three months ended March 31, 2024. The increase was attributable to an increase in the amount of our debt that was unhedged combined with the expiration of certain high value swaps. The components of our interest expense for the three months ended March 31, 2025 and 2024 were as follows (in thousands):

Previous wording

Gain on Sale of Hotel Properties, net

Current wording

Gain on Sale of Hotel Property, net

Previous wording

During the three months ended September 30, 2024, we sold one hotel property for a sale price of approximately $12.7 million and recorded a net gain on the sale of approximately $4.8 million. There were no hotels sold during the three months ended September 30, 2023.

Current wording

During the three months ended March 31, 2025, we sold one hotel property for a sales price of $24.3 million and recorded a net gain on the sale of $1.3 million. There were no hotels sold during the three months ended March 31, 2024.

Previous wording

The following table is a reconciliation of our GAAP net income to FFO attributable to common shareholders and unitholders and Adjusted FFO attributable to common shareholders and unitholders for the three and nine months ended September 30, 2024 and 2023 (in thousands):

Current wording

The following table is a reconciliation of our GAAP net income to FFO attributable to common shareholders and unitholders and Adjusted FFO attributable to common shareholders and unitholders for the three months ended March 31, 2025 and 2024 (in thousands):

Previous wording

The following table is a reconciliation of our GAAP net income to EBITDA, EBITDAre and Adjusted EBITDA for the three and nine months ended September 30, 2024 and 2023 (in thousands):

Current wording

The following table is a reconciliation of our GAAP net income to EBITDA, EBITDAre and Adjusted EBITDA for the three months ended March 31, 2025 and 2024 (in thousands):

Previous wording

As of September 30, 2024, we had $424.3 million of cash, cash equivalents, and restricted cash reserves as compared to $555.3 million at December 31, 2023.

Current wording

As of March 31, 2025, we had $372.4 million of cash, cash equivalents, and restricted cash reserves as compared to $433.3 million at December 31, 2024.

Previous wording

The net cash flow provided by operating activities totaled $214.4 million and $226.2 million for the nine months ended September 30, 2024 and 2023, respectively. Our cash flows provided by operating activities generally consist of the net cash generated by our hotel operations, the cash paid for corporate expenses and other working capital changes. Refer to the "Results of Operations" section for further discussion of our operating results for the nine months ended September 30, 2024 and 2023.

Current wording

The net cash flow provided by operating activities totaled $16.3 million and $20.8 million for the three months ended March 31, 2025 and 2024, respectively. Our cash flows provided by operating activities generally consist of the net cash generated by our hotel operations, the cash paid for corporate expenses and other working capital changes. Refer to the "Results of Operations" section for further discussion of our operating results for the three months ended March 31, 2025 and 2024.

Previous wording

The net cash flow used in investing activities totaled $246.3 million for the nine months ended September 30, 2024 primarily due to a $122.8 million acquisition of a fee simple interest in our Wyndham Boston Beacon Hill hotel property, a $35.9 million acquisition of a hotel property, and $107.0 million in capital improvements and additions to our hotel properties and other assets. The net cash flow used in investing activities was partially offset by $19.5 million in proceeds from the sales of two hotel properties.

Current wording

The net cash flow used in investing activities totaled $23.7 million for the three months ended March 31, 2025 primarily due to $46.8 million in capital improvements and additions to our hotel properties and other assets and a purchase deposit of $1.0 million. The net cash flow used in investing activities was partially offset by $24.1 million in proceeds from the sale of a hotel property.

Previous wording

The net cash flow used in investing activities totaled $102.0 million for the nine months ended September 30, 2023 primarily due to capital improvements and additions to our hotel properties.

Current wording

The net cash flow used in investing activities totaled $158.0 million for the three months ended March 31, 2024 primarily due to a $122.7 million acquisition of a fee simple interest in our Wyndham Boston Beacon Hill hotel property, $33.8 million in capital improvements and additions to our hotel properties and other assets, and a purchase deposit of $1.5 million.

Previous wording

The net cash flow used in financing activities totaled $130.2 million for the nine months ended September 30, 2023 primarily due to $66.8 million paid to repurchase common shares under our share repurchase programs, $52.6 million in distributions to shareholders and unitholders, $4.4 million paid to repurchase common shares to satisfy employee tax withholding requirements, and $7.8 million in deferred financing cost payments.

Current wording

The net cash flow used in financing activities totaled $53.6 million for the three months ended March 31, 2025 primarily due to $20.8 million paid to repurchase common shares under a share repurchase program, $29.6 million in distributions to shareholders and unitholders, and $3.1 million paid to repurchase common shares to satisfy employee tax withholding requirements.

Previous wording

The net cash flow used in financing activities totaled $99.1 million for the nine months ended September 30, 2024. The sources of cash included $500.0 million in borrowings on a Term Loan and $200.0 million in borrowings on our Revolver. The uses of cash included $400.0 million in repayment of a term loan, $200.0 million in repayment of a maturing mortgage loan, $100.0 million in repayment of our Revolver, $19.0 million paid to repurchase common shares under our share repurchase programs, $65.8 million in distributions to shareholders and unitholders, $9.0 million paid to repurchase common shares to satisfy employee tax withholding requirements, and $5.3 million in deferred financing cost payments.

Current wording

The net cash flow used in financing activities totaled $27.2 million for the three months ended March 31, 2024 primarily due to $1.3 million paid to repurchase common shares under a share repurchase program, $21.9 million in distributions to shareholders and unitholders, and $4.0 million paid to repurchase common shares to satisfy employee tax withholding requirements.

Previous wording

With respect to some of our hotels that are operated under franchise agreements with major national hotel brands and for some of our hotels subject to first mortgage liens, we are obligated to maintain FF&E reserve accounts for future capital expenditures at these hotels. The amount funded into each of these reserve accounts is generally determined pursuant to the management agreements, franchise agreements and/or mortgage loan documents for each of the respective hotels, and typically ranges between 3.0% and 5.0% of the respective hotel’s total gross revenue. As of September 30, 2024, approximately $39.0 million was held in FF&E reserve accounts for future capital expenditures.

Current wording

With respect to some of our hotels that are operated under franchise agreements with major national hotel brands and for some of our hotels subject to first mortgage liens, we are obligated to maintain FF&E reserve accounts for future capital expenditures at these hotels. The amount funded into each of these reserve accounts is generally determined pursuant to the management agreements, franchise agreements and/or mortgage loan documents for each of the respective hotels, and typically ranges between 3.0% and 5.0% of the respective hotel’s total gross revenue. As of March 31, 2025, approximately $24.9 million was held in FF&E reserve accounts for future capital expenditures.