Summary of Chatham Lodging Trust Q1 2026 Earnings Call

1Key Financial Results and Metrics

Hotel EBITDA: $21.4 million.

Adjusted EBITDA: $818.4 million.

Adjusted FFO: $0.20 per share.

GOP Margin: 40.2%, up 60 basis points year-over-year.

Hotel EBITDA Margin: 31.8%, increased by 140 basis points.

RevPAR Growth: 1% for Q1; notable growth in Silicon Valley with 23% excluding the Mountain View hotel under renovation.

Occupancy Rate: 74%, 200 basis points higher than the portfolio average.

Dividend Increase: Common dividend raised by 11% in Q1, following a 28% increase in 2025.

2Strategic Updates and Business Highlights

Acquisition: Acquired a portfolio of six Hilton-branded hotels for $92 million, expected to be accretive to FFO and free cash flow.

Share Repurchases: 2.2 million shares repurchased (4% of common equity) at an average price of $7.04, with plans to continue repurchasing shares given perceived undervaluation.

Operational Performance: Strong RevPAR growth across the portfolio, particularly in Silicon Valley, with over two-thirds of hotels showing RevPAR growth.

Market Diversification: The new hotel portfolio diversifies into markets benefiting from manufacturing and distribution investments.

3Forward Guidance and Outlook

2026 Guidance:

RevPAR growth forecasted at 0% to 2%.

Adjusted EBITDA expected between $95.3 million and $99.6 million.

Adjusted FFO per share projected at $1.21 to $1.29.

Short-term Expectations: Anticipated RevPAR growth of 1% to 2% for Q2 2026.

Long-term Projects: Development of a hotel in Portland, Maine, expected to begin soon, with strong projected returns.

4Challenges and Points of Concern

Market Headwinds: Potential adverse effects from geopolitical tensions, particularly in the Middle East, impacting travel and gas prices.

Competitive Pressures: Some markets, such as Austin and Dallas, facing declining RevPAR due to renovation impacts and softer convention demand.

Future Guidance Caution: Acknowledgment of conservatism in guidance due to uncertain market conditions and the anticipated impact of the World Cup on travel demand.

5Notable Q&A Insights

Acquisition Details: The recent hotel acquisition was a brokered transaction, with performance slightly exceeding underwriting expectations.

Supply Growth: Minimal new supply in the newly acquired markets, which could benefit future performance.

World Cup Expectations: Management is conservatively optimistic about the World Cup's impact, factoring in high ticket prices and travel challenges.

Silicon Valley Outlook: Continued strong performance anticipated, with potential upside post-renovation of the Mountain View hotel. Overall, Chatham Lodging Trust reported a strong Q1 2026, with solid operational metrics and strategic acquisitions enhancing its portfolio, although it remains cautious about external market pressures and competition.