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Mar 31, 2020
Chatham Q1 2020 Earnings Report
Chatham Lodging Trust's financial performance declined due to the impact of COVID-19, with a decrease in RevPAR, net loss, and adjusted EBITDA.
Key Takeaways
Chatham Lodging Trust reported a net loss of $28.1 million for Q1 2020, a significant decrease compared to the net income of $1.6 million in Q1 2019. The company's RevPAR declined by 21.8% to $96, and adjusted EBITDA decreased to $16.5 million. The company suspended its monthly dividend and implemented cost-cutting measures in response to the COVID-19 pandemic.
Portfolio RevPAR decreased by 21.8% to $96 compared to Q1 2019.
Net loss was $(28.1) million, a decline of $29.7 million compared to Q1 2019.
Adjusted EBITDA decreased by $10.5 million to $16.5 million.
The company suspended its monthly dividend and reduced capital expenditures in response to the COVID-19 pandemic.
Forward Guidance
The company withdrew its original guidance for the remainder of 2020 on March 10, 2020 and will not issue new guidance due to the uncertainty caused by the COVID-19. The company does not expect to pay any additional dividends for the remainder of 2020.
Positive Outlook
- Aggressively cut operating costs and deferred all non-essential capital expenditures to minimize the adverse effects on cash flow.
- Suspended its monthly dividend entirely, preserving approximately $5.3 million per month and approximately $64 million on an annualized basis.
- Reduced its 2020 capital expenditures budget by approximately $10 million or 45 percent.
- Amended its credit facility on May 6, 2020 to provide covenant relief and full access to its entire $250 million capacity.
- Negotiated three-month deferral of interest, principal amortization and capital expenditure reserve contributions for its Residence Inn New Rochelle mortgage loan.
Challenges Ahead
- Uncertainty caused by the COVID-19.
- Expect demand will recover slowly.
Historical Earnings Impact
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Avg. Return Before/After Earnings
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