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Sep 30, 2020
Chatham Q3 2020 Earnings Report
Chatham's Q3 2020 performance reflected resilience amidst the pandemic, with positive EBITDA and strategic asset management fortifying the balance sheet.
Key Takeaways
Chatham Lodging Trust announced Q3 2020 results, demonstrating resilience with positive EBITDA of $5.1 million and a strategic focus on balance sheet strength. RevPAR declined by 61% to $58 compared to Q3 2019, but showed a positive rebound from Q2 2020. The company is under contract to sell a hotel for $67 million, further enhancing liquidity.
Chatham achieved positive adjusted EBITDA of $5.1 million, a significant rebound from the previous quarter's loss.
RevPAR decreased by 61% year-over-year to $58, but improved compared to the second quarter of 2020.
The company maintained positive GOP margins of 36% despite the challenging environment.
A pending hotel sale is expected to generate $36 million in net proceeds, strengthening the balance sheet.
Revenue by Segment
Revenue by Geographic Location
Forward Guidance
Chatham anticipates continued recovery and is strategically managing its portfolio and liquidity to navigate the ongoing pandemic.
Positive Outlook
- The company expects to complete the renovation of the Residence Inn in Anaheim, Calif., in the fourth quarter, including the addition of a new bar.
- Construction of the hotel in the Warner Center submarket of Los Angeles is ahead of schedule and expected to be completed in the 2021 fourth quarter.
- Chatham closed on a $40.0 million construction loan for the Warner Center development.
- The company has estimated liquidity of $109 million as of September 30, 2020.
- Pro forma total liquidity will rise to $145 million upon completion of the sale of the Mission Valley Residence Inn.
Challenges Ahead
- The timing and shape of a RevPAR recovery is unknown.
- All remaining renovations planned to commence later in 2020 have been deferred until at least 2021.
- All remaining capital projects, other than the Warner Center development, have been suspended.
Revenue & Expenses
Visualization of income flow from segment revenue to net income
Historical Earnings Impact
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Avg. Return Before/After Earnings
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