Sotherly Hotels Inc. Reports Financial Results for the Fourth Quarter Ended December 31, 2024

WILLIAMSBURG, Va., March 13, 2025 (GLOBE NEWSWIRE) -- Sotherly Hotels Inc. (NASDAQ: SOHO), ("Sotherly” or the "Company”), a self-managed and self-administered lodging real estate investment trust (a "REIT”), today reported its consolidated results for the fourth quarter and year ended December 31, 2024. The Company's results include the following*:

	Three Months Ended						Years Ended
	December 31, 2024			December 31, 2023			December 31, 2024			December 31, 2023
	($ in thousands except per share data)						($ in thousands except per share data)
Total revenues	$	43,952		$	42,148		$	181,894		$	173,838
Net (loss) income		(1,118	)		(770	)		1,180			3,810
Net loss attributable to common stockholders		(3,034	)		(2,683	)		(6,675	)		(4,036	)

EBITDA		9,383			8,490			40,883			39,079
Hotel EBITDA		10,668			10,300			46,813			44,788

FFO attributable to common stockholders and unitholders		1,571			1,915			12,017			13,193
Adjusted FFO attributable to common stockholders and unitholders		1,955			2,803			14,290			14,542

Net loss per common share - diluted	$	(0.16	)	$	(0.14	)	$	(0.34	)	$	(0.22	)
FFO per common share and unit	$	0.08		$	0.10		$	0.61		$	0.68
Adjusted FFO per common share and unit	$	0.10		$	0.14		$	0.72		$	0.75

(*) Earnings before interest, taxes, depreciation and amortization ("EBITDA”), Hotel EBITDA, Funds From Operations ("FFO”) attributable to common stockholders and unitholders, Adjusted FFO attributable to common stockholders and unitholders, FFO per common share and unit and Adjusted FFO per common share and unit are non-GAAP financial measures. See further discussion of these non-GAAP measures, including definitions related thereto, and reconciliations to net (loss) income later in this press release. The Company is the sole general partner of Sotherly Hotels LP, a Delaware limited partnership (the "Operating Partnership”), and all references in this release to the "Company,” "Sotherly,” "we,” "us,” and "our” refer to Sotherly Hotels Inc., its Operating Partnership and its subsidiaries and predecessors, unless the context otherwise requires or it is otherwise indicated.

HIGHLIGHTS

RevPAR. Room revenue per available room ("RevPAR”) for the Company's composite portfolio, which includes the rooms participating in our rental programs at the Lyfe Resort & Residences (f/k/a Hyde Resort & Residences) and the Hyde Beach House Resort & Residences, increased 2.6% to $108.99, for the three months ended December 31, 2024, from $106.25 in the comparable period in 2023. Changes in RevPAR were driven by a 4.1% increase in occupancy to 64.1% from 60.0% in the comparable 2023 period, and a 3.9% decrease in the average daily rate ("ADR”) to $170.10 for the three months ended December 31, 2024, from $177.07 for the comparable period in 2023. For the twelve months ended December 31, 2024, RevPAR increased 3.7% to $119.26, from $114.96 in the comparable period in 2023. Changes in RevPAR were driven by an increase in the occupancy to 67.2% for the twelve months ended December 31, 2024, from 62.8% for the comparable period in 2023 and by a 3.0% decrease in ADR to $177.56 from $182.97 in the comparable 2023 period.
Revenue. Total revenue increased to approximately $44.0 million, from approximately $42.1 million, for the three months ended December 31, 2024 and 2023, respectively. For the twelve months ended December 31, 2024, total revenue increased to approximately $181.9 million, from approximately $173.8 million during the comparable period in 2023.
Net loss attributable to common stockholders. For the three months ended December 31, 2024, net loss attributable to common stockholders increased approximately $0.4 million, compared to the three months ended December 31, 2023, from a loss of approximately $2.7 million to a loss of approximately $3.0 million. For the twelve months ended December 31, 2024, net loss attributable to common stockholders increased 65.4%, or approximately $2.7 million, over the twelve months ended December 31, 2023, from a loss of approximately $4.0 million to a loss of approximately $6.7 million.
Hotel EBITDA. Hotel EBITDA increased to approximately $10.7 million for the three months ended December 31, 2024, from approximately $10.3 million for the comparable period in 2023. Hotel EBITDA for the twelve months ended December 31, 2024 increased approximately $2.0 million to approximately $46.8 million, from approximately $44.8 million generated in the comparable 2023 period.
Adjusted FFO attributable to common stockholders and unitholders. For the three months ended December 31, 2024, Adjusted FFO attributable to common stockholders and unitholders decreased 30.3%, or approximately $0.8 million, over the three months ended December 31, 2023, from approximately $2.8 million to approximately $2.0 million. For the twelve months ended December 31, 2024, adjusted FFO attributable to common stockholders and unitholders decreased 1.7%, or by approximately $0.2 million, over the twelve months ended December 31, 2023, from approximately $14.5 million to approximately $14.3 million.
Preferred Dividends. On January 28, 2025 the Company announced a quarterly cash dividend of $0.50 per share of beneficial interest of the Company's 8.0% Series B Cumulative Redeemable Perpetual Preferred Stock; a quarterly cash dividend of $0.492188 per share of beneficial interest of the Company's 7.875% Series C Cumulative Redeemable Perpetual Preferred Stock; and a quarterly cash dividend of $0.515625 per share of beneficial interest of the Company's 8.25% Series D Cumulative Redeemable Perpetual Preferred Stock. Each of the Series B, Series C and Series D preferred dividends will be paid on March 14, 2025 to shareholders of record as of February 28, 2025.

Dave Folsom, President and Chief Executive Officer of Sotherly Hotels Inc., commented, "The fourth quarter continued the positive trends we witnessed in 2024, as both total revenues and Hotel EBITDA saw incremental increases over the fourth quarter of 2023. In the quarter, total revenues were $44.0 million, an increase of $1.8 million over the fourth quarter of 2023. For the full year, Sotherly's total revenues continued to grow, increasing by 4.6%, or more than $8.0 million to $181.9 million. For 2024, total Hotel EBITDA increased $2.0 million to $46.8 million, a 4.5% increase. Throughout 2024, Sotherly continued to successfully navigate the mortgage markets, by completing refinancings or extensions of mortgages at several of its hotels, including the DoubleTree at the Philadelphia Airport; Hotel Alba, in Tampa; and the DoubleTree in Jacksonville, Florida. Concurrently, the Company continues its efforts in executing life cycle improvements in conjunction with the renewal of Hilton franchises at its DoubleTree locations in Philadelphia and Jacksonville. Restoration of post Hurricane Helene damage at the Hotel Alba in Tampa continues to proceed. The hotel was fully operational in Q4. To date, the work associated with this fully insured casualty, including significant business interruption insurance proceeds, has been efficiently executed and only final FF&E replacements and elevator work remain to be accomplished. Looking ahead to 2025, Sotherly is encouraged by ongoing improvements in demand at many of our markets that were slow to recover following the pandemic. Our hotels in Houston, Atlanta, Hollywood (Florida), and Philadelphia continue to meet enhanced revenue and profitability targets as we transition into Q1 of 2025, which is an encouraging sign for the total portfolio."

Balance Sheet/Liquidity

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As of December 31, 2024, the Company had approximately $28.7 million of available cash and cash equivalents, of which approximately $21.4 million was reserved for real estate taxes, insurance, capital improvements and certain other expenses or otherwise restricted. The Company had principal balances of approximately $319.3 million in outstanding debt, including mortgage and unsecured principal balances, at a weighted average interest rate of approximately 5.88%.

2025 Outlook

Set forth below is the Company's guidance for 2025. The table below reflects the Company's projections, within a range, of various financial measures for 2025, in thousands of dollars, except per share and RevPAR data:

	2025 Guidance
	Low Range			High Range

Total revenues	$	183,388		$	188,168
Net (loss) income		(676	)		129
Net loss attributable to common stockholders and unitholders		(8,651	)		(7,846	)

EBITDA		41,879			42,704
Hotel EBITDA		48,829			49,619

FFO attributable to common stockholders and unitholders		10,539			11,344
Adjusted FFO attributable to common stockholders and unitholders		11,544			12,349

Net loss per share attributable to common stockholders	$	(0.43	)	$	(0.39	)
FFO per common share and unit	$	0.52		$	0.56
Adjusted FFO per common share and unit	$	0.57		$	0.61
Rev PAR	$	119.77		$	122.89
Hotel EBITDA margin		26.1	%		26.4	%

Earnings Call/Webcast

The Company will conduct its fourth quarter 2024 conference call for investors and other interested parties at 10:00 a.m. Eastern Time on Thursday, March 13, 2025. The conference call will be accessible by telephone and through the Internet. Interested individuals are invited to listen to the call by telephone at 833-470-1428 (United States) and enter access code 538548. To participate on the webcast, log on to www.sotherlyhotels.com at least 15 minutes before the call to download the necessary software. For those unable to listen to the call live, a taped rebroadcast will be available beginning one hour after completion of the live call on March 13, 2025 through March 20, 2025. To access the rebroadcast, dial 866-813-9403 and enter access code 963139.

About Sotherly Hotels Inc.

Sotherly Hotels Inc. is a self-managed and self-administered lodging REIT focused on the acquisition, renovation, upbranding and repositioning of upscale to upper-upscale full-service hotels in the Southern United States. Sotherly may also opportunistically acquire hotels throughout the United States. Currently, the Company's portfolio consists of investments in ten hotel properties, comprising 2,786 rooms, as well as interests in two condominium hotels and their associated rental programs. The Company owns hotels that operate under the Hilton Worldwide and Hyatt Hotels Corporation brands, as well as independent hotels. Sotherly Hotels Inc. was organized in 2004 and is headquartered in Williamsburg, Virginia. For more information, please visit www.sotherlyhotels.com.

Forward-Looking Statements

This news release includes "forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, and as such may involve known and unknown risks, uncertainties and other factors which may cause our actual results, performance or achievements to be materially different from future results, performance or achievements expressed or implied by such forward-looking statements. Forward-looking statements, which are based on certain assumptions and describe our current strategies, expectations, and future plans are generally identified by our use of words, such as "intend,” "plan,” "may,” "should,” "will,” "project,” "estimate,” "anticipate,” "believe,” "expect,” "continue,” "potential,” "opportunity,” and similar expressions, whether in the negative or affirmative, but the absence of these words does not necessarily mean that a statement is not forward-looking. We also sometimes refer to our booking pace. Booking pace is an industry term that we define as the estimated value of committed future bookings at a given point in time. Booking pace can be further separated into various segments, including group booking pace or business travel booking pace. All statements regarding our expected financial position, booking pace, business and financing plans are forward-looking statements.

Factors which could have a material adverse effect on the Company's future operations, results, performance and prospects, include, but are not limited to: national and local economic and business conditions that affect occupancy rates and revenues at our hotels and the demand for hotel products and services; risks associated with the hotel industry, including competition and new supply of hotel rooms, increases in wages, energy costs and other operating costs; risks associated with the level of our indebtedness and our ability to meet covenants in our debt agreements, including loan modifications and, as necessary, to refinance or seek an extension of the maturity of such indebtedness or further modification of such debt agreements; risks associated with adverse weather conditions, including hurricanes; impacts on the travel industry from pandemic diseases, including COVID-19; the availability and terms of financing and capital and the general volatility of the securities markets; management and performance of our hotels; risks associated with maintaining our system of internal controls; risks associated with the conflicts of interest of the Company's officers and directors; risks associated with redevelopment and repositioning projects, including delays and cost overruns; supply and demand for hotel rooms in our current and proposed market areas; risks associated with our ability to maintain our franchise agreements with our third party franchisors; our ability to acquire additional properties and the risk that potential acquisitions may not perform in accordance with expectations; our ability to successfully expand into new markets; legislative/regulatory changes, including changes to laws governing taxation of real estate investment trusts ("REITs”); the Company's ability to maintain its qualification as a REIT; and our ability to maintain adequate insurance coverage. Although the Company believes that the assumptions underlying the forward-looking statements contained herein are reasonable, any of the assumptions could be inaccurate, and therefore there can be no assurance that such statements included in this report will prove to be accurate. In light of the significant uncertainties inherent in the forward-looking statements included herein, the inclusion of such information should not be regarded as a representation by the Company or any other person that the results or conditions described in such statements or the objectives and plans of the Company will be achieved.

Additional factors that could cause actual results to vary from our forward-looking statements are set forth under the section titled "Risk Factors” in our Annual Report on Form 10-K, in this press release and subsequent reports filed with the Securities and Exchange Commission. Except as required by law, the Company undertakes no obligation to and does not intend to publicly update or revise any forward-looking statement, whether as a result of new information, future events or otherwise. Although the Company believes its current expectations to be based upon reasonable assumptions, it can give no assurance that its expectations will be attained or that actual results will not differ materially.

Financial Tables Follow…

SOTHERLY HOTELS INC. CONSOLIDATED BALANCE SHEETS

	December 31, 2024			December 31, 2023
	(unaudited)
ASSETS
Investment in hotel properties, net	$	372,376,626		$	354,919,106
Cash and cash equivalents		7,327,880			17,101,993
Restricted cash		21,382,595			9,134,347
Accounts receivable, net		7,525,356			5,945,724
Prepaid expenses, inventory and other assets		5,763,463			6,342,310
TOTAL ASSETS	$	414,375,920		$	393,443,480
LIABILITIES
Mortgage loans, net	$	316,516,148		$	315,989,194
Unsecured notes		658,766			1,536,809
Finance lease liabilities		23,201,751			-
Accounts payable and accrued liabilities		26,577,504			23,315,677
Advance deposits		3,734,825			2,614,981
Dividends and distributions payable		2,088,160			2,088,160
TOTAL LIABILITIES	$	372,777,154		$	345,544,821
Commitments and contingencies		-			-
EQUITY
Sotherly Hotels Inc. stockholders' equity
Preferred stock, $0.01 par value, 11,000,000 shares authorized:
8.0% Series B cumulative redeemable perpetual preferred stock, 1,464,100 and 1,464,100 shares issued and outstanding; aggregate liquidation preference each $44,655,050, at December 31, 2024 and December 31, 2023, respectively.		14,641			14,641
7.875% Series C cumulative redeemable perpetual preferred stock, 1,346,110 and 1,346,110 shares issued and outstanding; aggregate liquidation preference each $40,940,681, at December 31, 2024 and December 31, 2023, respectively.		13,461			13,461
8.25% Series D cumulative redeemable perpetual preferred stock, 1,163,100 and 1,163,100 shares issued and outstanding; aggregate liquidation preference each $35,674,458, at December 31, 2024 and December 31, 2023, respectively.		11,631			11,631
Common stock, par value $0.01, 69,000,000 shares authorized, 19,849,165 shares issued and outstanding at December 31, 2024 and 19,696,805 shares issued and outstanding at December 31, 2023.		198,492			196,968
Additional paid-in capital		175,372,798			175,779,222
Unearned ESOP shares		(862,107	)		(1,764,507	)
Distributions in excess of retained earnings		(131,695,891	)		(125,021,013	)
Total Sotherly Hotels Inc. stockholders' equity		43,053,025			49,230,403
Noncontrolling interest		(1,454,259	)		(1,331,744	)
TOTAL EQUITY		41,598,766			47,898,659
TOTAL LIABILITIES AND EQUITY	$	414,375,920		$	393,443,480