The following is a summary of the Apple Hospitality REIT, Inc. (APLE) Q3 2024 Earnings Call Transcript:

Financial Performance:

• Apple Hospitality REIT reported a stable quarter with a RevPAR growth of approximately 1%.

• Adjusted EBITDAre for the quarter was $129 million and modified funds from operations were $107 million, marking increases of 6% and 3% respectively year-over-year.

• Preliminary results for October show continued growth with RevPAR up approximately 4% compared to October 2023.

• Comparable hotels total revenue was $378 million for the third quarter and $1.1 billion year-to-date, up about 2% over the same periods in 2023.

Business Progress:

• The company highlighted steady improvements in business travel as a primary growth driver, alongside strong leisure travel demand.

• Recent strategic acquisitions and dispositions of assets were aimed at optimizing the portfolio, reducing debt, and acquiring new properties with stronger growth profiles and lower CapEx needs.

• Approximately $48 million invested in capital expenditures with plans to spend between $75 million and $85 million throughout 2024 for renovations across 20 hotels.

• Active share repurchases under the program, with about 2.4 million shares repurchased year-to-date.

Opportunities:

• Limited supply growth in key markets is seen as a material improvement in risk profile and upside potential for lodging demand.

• Strong operating performance and favorable supply-demand dynamics offer further growth opportunities.

Risks:

• The transaction market remains challenging, although the company has adapted by focusing on smaller, rooms-focused properties for acquisitions and disposals at attractive cap rates.

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