The following is a summary of the Summit Hotel Properties, Inc. (INN) Q2 2024 Earnings Call Transcript:

Financial Performance:

• Summit Hotel Properties reported a 6% increase in adjusted EBITDAre to nearly $56 million, a quarterly record high.

• Adjusted FFO increased by 10% year-over-year.

• Pro forma RevPAR growth was 3.4% year-over-year, with an increase in occupancy by 2.4% predominantly in urban and suburban markets.

• Hotel EBITDA grew by 6% with a flow-through of more than 70%, driving a hotel EBITDA margin expansion of 120 basis points.

• For the remainder of the year, full year RevPAR growth range was revised to 1% to 2.5%.

Business Progress:

• Continued strong performance in urban markets, with notable growth in Indianapolis, Cleveland, Charlotte, Minneapolis, and Baltimore.

• Ongoing renovations and repositioning activities, such as at the Courtyard Fort Lauderdale Beach, aimed at enhancing guest experiences and profitability.

• Disposition of 9 hotels since 2023 for $131 million, improving balance sheet health and reducing near-term CapEx requirements.

• Implemented revenue boost strategies like paid parking opportunities and implementation of resort fees, increasing ancillary revenue by over 5.5% for the quarter.

Opportunities:

• Strong recovery in urban markets gives competitive advantage, particularly in markets like Silicon Valley known for technology-related business travel.

• Improved group demand, especially in urban locations, provides resilience and growth potentials.

Risks:

• Leisure demand normalizing, particularly noticeable around peak summer travel months, leading to tempered outlook and reduction in expected growth rates.

More details: Summit Hotel Properties Inc IR

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