EX-99.2 3 sho-20230804xex99d2.htm EX-99.2

Exhibit 99.2

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Supplemental Financial Information

For the quarter ended June 30, 2023

August 4, 2023

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Supplemental Financial Information
August 4, 2023

CORPORATE PROFILE AND DISCLOSURES
REGARDING NON-GAAP FINANCIAL MEASURES

CORPORATE PROFILE AND DISCLOSURES REGARDING NON-GAAP FINANCIAL MEASURES

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Supplemental Financial Information
August 4, 2023

About Sunstone

Sunstone Hotel Investors, Inc. (the “Company,” “we,” and “our”) (NYSE: SHO) is a lodging real estate investment trust (“REIT”) that as of August 4, 2023 owns 15 hotels comprised of 7,735 rooms, the majority of which are operated under nationally recognized brands. Sunstone’s strategy is to create long-term stakeholder value through the acquisition, active ownership and disposition of hotels considered to be Long-Term Relevant Real Estate®.

This presentation contains unaudited information, and should be read together with the consolidated financial statements and notes thereto included in our most recent reports on Form 10-K and Form 10-Q. Copies of these reports are available on our website at www.sunstonehotels.com and through the SEC’s Electronic Data Gathering Analysis and Retrieval System (“EDGAR”) at www.sec.gov.

Corporate Headquarters
15 Enterprise, Suite 200
Aliso Viejo, CA 92656
(949) 330-4000

Company Contacts
Bryan Giglia
Chief Executive Officer
(949) 382-3036

Aaron Reyes
Chief Financial Officer
(949) 382-3018

CORPORATE PROFILE AND DISCLOSURES REGARDING NON-GAAP FINANCIAL MEASURES

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Supplemental Financial Information
August 4, 2023

Non-GAAP Financial Measures

We present the following non-GAAP financial measures that we believe are useful to investors as key supplemental measures of our operating performance: earnings before interest expense, taxes, depreciation and amortization for real estate, or EBITDAre; Adjusted EBITDAre, excluding noncontrolling interest (as defined below); funds from operations attributable to common stockholders, or FFO attributable to common stockholders; Adjusted FFO attributable to common stockholders (as defined below); hotel Adjusted EBITDAre; and hotel Adjusted EBITDAre margins. These measures should not be considered in isolation or as a substitute for measures of performance in accordance with GAAP. In addition, our calculation of these measures may not be comparable to other companies that do not define such terms exactly the same as the Company. These non-GAAP measures are used in addition to and in conjunction with results presented in accordance with GAAP. They should not be considered as alternatives to net income (loss), cash flow from operations, or any other operating performance measure prescribed by GAAP. These non-GAAP financial measures reflect additional ways of viewing our operations that we believe, when viewed with our GAAP results and the reconciliations to the corresponding GAAP financial measures, provide a more complete understanding of factors and trends affecting our business than could be obtained absent this disclosure. We strongly encourage investors to review our financial information in its entirety and not to rely on a single financial measure.

We present EBITDAre in accordance with guidelines established by the National Association of Real Estate Investment Trusts (“Nareit”), as defined in its September 2017 white paper “Earnings Before Interest, Taxes, Depreciation and Amortization for Real Estate.” We believe EBITDAre is a useful performance measure to help investors evaluate and compare the results of our operations from period to period in comparison to our peers. Nareit defines EBITDAre as net income (calculated in accordance with GAAP) plus interest expense, income tax expense, depreciation and amortization, gains or losses on the disposition of depreciated property (including gains or losses on change in control), impairment write-downs of depreciated property and of investments in unconsolidated affiliates caused by a decrease in the value of depreciated property in the affiliate, and adjustments to reflect the entity’s share of EBITDAre of unconsolidated affiliates.

We make additional adjustments to EBITDAre when evaluating our performance because we believe that the exclusion of certain additional items described below provides useful information to investors regarding our operating performance, and that the presentation of Adjusted EBITDAre, excluding noncontrolling interest, when combined with the primary GAAP presentation of net income, is beneficial to an investor’s complete understanding of our operating performance. In addition, we use both EBITDAre and Adjusted EBITDAre, excluding noncontrolling interest as measures in determining the value of hotel acquisitions and dispositions.

We believe that the presentation of FFO attributable to common stockholders provides useful information to investors regarding our operating performance because it is a measure of our operations without regard to specified noncash items such as real estate depreciation and amortization, any real estate impairment loss and any gain or loss on sale of real estate assets, all of which are based on historical cost accounting and may be of lesser significance in evaluating our current performance. Our presentation of FFO attributable to common stockholders conforms to Nareit’s definition of “FFO applicable to common shares.” Our presentation may not be comparable to FFO reported by other REITs that do not define the terms in accordance with the current Nareit definition, or that interpret the current Nareit definition differently that we do.

We also present Adjusted FFO attributable to common stockholders when evaluating our operating performance because we believe that the exclusion of certain additional items described below provides useful supplemental information to investors regarding our ongoing operating performance, and may facilitate comparisons of operating performance between periods and our peer companies.

CORPORATE PROFILE AND DISCLOSURES REGARDING NON-GAAP FINANCIAL MEASURES

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Supplemental Financial Information
August 4, 2023

We adjust EBITDAre and FFO attributable to common stockholders for the following items, which may occur in any period, and refer to these measures as either Adjusted EBITDAre, excluding noncontrolling interest or Adjusted FFO attributable to common stockholders:

Amortization of deferred stock compensation: we exclude the noncash expense incurred with the amortization of deferred stock compensation as this expense is based on historical stock prices at the date of grant to our corporate employees and does not reflect the underlying performance of our hotels.
Amortization of contract intangibles: we exclude the noncash amortization of any favorable or unfavorable contract intangibles recorded in conjunction with our hotel acquisitions. We exclude the noncash amortization of contract intangibles because it is based on historical cost accounting and is of lesser significance in evaluating our actual performance for the current period.
Gains or losses from debt transactions: we exclude the effect of finance charges and premiums associated with the extinguishment of debt, including the acceleration of deferred financing costs from the original issuance of the debt being redeemed or retired because, like interest expense, their removal helps investors evaluate and compare the results of our operations from period to period by removing the impact of our capital structure.
Cumulative effect of a change in accounting principle: from time to time, the FASB promulgates new accounting standards that require the consolidated statement of operations to reflect the cumulative effect of a change in accounting principle. We exclude these one-time adjustments, which include the accounting impact from prior periods, because they do not reflect our actual performance for that period.
Other adjustments: we exclude other adjustments that we believe are outside the ordinary course of business because we do not believe these costs reflect our actual performance for the period and/or the ongoing operations of our hotels. Such items may include: lawsuit settlement costs; the write-off of development costs associated with abandoned projects; property-level restructuring, severance and management transition costs; debt resolution costs; lease terminations; property insurance restoration proceeds or uninsured losses; and other nonrecurring identified adjustments.

In addition, to derive Adjusted EBITDAre, excluding noncontrolling interest we exclude the noncontrolling partner’s pro rata share of the net (income) loss allocated to the Hilton San Diego Bayfront partnership prior to our acquisition of the noncontrolling partner’s interest in June 2022, as well as the noncontrolling partner’s pro rata share of any EBITDAre and Adjusted EBITDAre components. We also exclude the amortization of our right-of-use assets and related lease obligations as these expenses are based on historical cost accounting and do not reflect the actual rent amounts due to the respective lessors or the underlying performance of our hotels. Additionally, we include an adjustment for the cash finance lease expense recorded on the building lease at the Hyatt Centric Chicago Magnificent Mile (prior to the hotel’s sale in February 2022). We determined that the building lease was a finance lease, and, therefore, we included a portion of the lease payment each month in interest expense. We adjust EBITDAre for the finance lease in order to more accurately reflect the actual rent due to the hotel’s lessor in the respective period, as well as the operating performance of the hotel. We also exclude the effect of gains and losses on the disposition of undepreciated assets because we believe that including them in Adjusted EBITDAre, excluding noncontrolling interest is not consistent with reflecting the ongoing performance of our assets.

CORPORATE PROFILE AND DISCLOSURES REGARDING NON-GAAP FINANCIAL MEASURES

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Supplemental Financial Information
August 4, 2023

To derive Adjusted FFO attributable to common stockholders, we also exclude the noncash interest on our derivatives and finance lease obligation as we believe that these items are not reflective of our ongoing finance costs. Additionally, we exclude the noncontrolling partner’s pro rata share of any FFO adjustments related to our consolidated Hilton San Diego Bayfront partnership components prior to our acquisition of the noncontrolling partner’s interest in June 2022. We also exclude the real estate amortization of our right-of-use assets and related lease obligations, which includes the amortization of both our finance and operating lease intangibles (with the exception of our corporate operating lease), as these expenses are based on historical cost accounting and do not reflect the actual rent amounts due to the respective lessors or the underlying performance of our hotels. In addition, we exclude preferred stock redemption charges, changes to deferred tax assets, liabilities or valuation allowances, and income tax benefits or provisions associated with the application of net operating loss carryforwards, uncertain tax positions or with the sale of assets other than real estate investments.

In presenting hotel Adjusted EBITDAre and hotel Adjusted EBITDAre margins, miscellaneous non-hotel items have been excluded. We believe the calculation of hotel Adjusted EBITDAre results in a more accurate presentation of the hotel Adjusted EBITDAre margins for our hotels, and that these non-GAAP financial measures are useful to investors in evaluating our property-level operating performance.

Reconciliations of net income to EBITDAre, Adjusted EBITDAre, excluding noncontrolling interest, FFO attributable to common stockholders, Adjusted FFO attributable to common stockholders, hotel Adjusted EBITDAre and hotel Adjusted EBITDAre margins are set forth in the following pages of this supplemental package. Beginning with the quarter ended March 31, 2022, the Company’s calculation of Adjusted FFO attributable to common stockholders excludes the noncash amortization expense associated with deferred stock compensation. Adjusted FFO attributable to common stockholders for the prior periods presented in this supplemental package have also been adjusted to exclude this expense.

The 15 Hotel Portfolio consists of all 15 hotels owned by the Company as of June 30, 2023. The 15 Hotel Portfolio presented for the second quarters and first six months of 2022 and 2019 includes prior ownership results for The Confidante Miami Beach acquired by the Company in June 2022. The Company obtained prior ownership information from the prior owner of The Confidante Miami Beach during the due diligence period before acquiring the hotel. The Company performed a limited review of the information as part of its analysis of the acquisition.

The 13 Hotel Portfolio consists of the 15 Hotel Portfolio, excluding the Montage Healdsburg and the Four Seasons Resort Napa Valley, which were acquired in April 2021 and December 2021, respectively. Both the Montage Healdsburg and the Four Seasons Resort Napa Valley were newly-developed hotels that were not open in 2019. The 13 Hotel Portfolio presented for the second quarters and first six months of 2022 and 2019 includes prior ownership results for The Confidante Miami Beach acquired by the Company in June 2022.

CORPORATE PROFILE AND DISCLOSURES REGARDING NON-GAAP FINANCIAL MEASURES

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Supplemental Financial Information
August 4, 2023

COMPARABLE CORPORATE FINANCIAL INFORMATION

COMPARABLE CORPORATE FINANCIAL INFORMATION

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Supplemental Financial Information
August 4, 2023

Comparable Consolidated Statements of Operations

Q2 2023 – Q3 2022, Trailing 12 Months

Quarter Ended (1)

Trailing 12 Months (1)

(Unaudited and in thousands, except per share data)

June 30,

March 31,

December 31,

September 30,

Ended

2023

    

2023

    

2022

    

2022

    

June 30, 2023

Revenues

Room

$

173,399

$

152,438

$

147,277

$

158,400

$

631,514

Food and beverage

78,815

70,812

65,847

63,476

278,950

Other operating

23,898

20,193

31,020

22,438

97,549

Total revenues

276,112

243,443

244,144

244,314

1,008,013

Operating Expenses

Room

42,658

39,064

38,691

38,791

159,204

Food and beverage

51,997

48,535

48,187

47,181

195,900

Other expenses

92,211

90,245

84,308

88,746

355,510

Corporate overhead

8,396

8,468

7,936

7,879

32,679

Depreciation and amortization

32,397

32,342

32,393

31,750

128,882

Impairment loss

3,466

3,466

Total operating expenses

227,659

218,654

214,981

214,347

875,641

Interest and other income

4,639

541

476

270

5,926

Interest expense

(9,223)

(13,794)

(11,717)

(9,269)

(44,003)

Loss on extinguishment of debt

(784)

(784)

Income before income taxes

43,869

11,536

17,922

20,184

93,511

Income tax (provision) benefit, net

(803)

(358)

(485)

290

(1,356)

Net income

$

43,066

$

11,178

$

17,437

$

20,474

$

92,155

Comparable Hotel Adjusted EBITDAre (2)

$

89,133

$

65,413

$

61,866

$

69,422

$

285,834

Comparable Adjusted EBITDAre (3)

$

85,057

$

60,029

$

68,777

$

63,848

$

277,711

Comparable Adjusted FFO attributable to common stockholders (4)

$

67,387

$

43,824

$

53,733

$

51,264

$

216,208

Comparable Adjusted FFO attributable to common stockholders per diluted share (4)

$

0.33

$

0.21

$

0.26

$

0.25

$

1.05

*Footnotes on page 11

COMPARABLE CORPORATE FINANCIAL INFORMATION

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Supplemental Financial Information
August 4, 2023

Comparable Consolidated Statements of Operations

Q4 2022 – Q1 2022, FY 2022

Quarter Ended (1)

Year Ended (1)

(Unaudited and in thousands, except per share data)

December 31,

September 30,

June 30,

March 31,

December 31,

2022

    

2022

    

2022

    

2022

    

2022

Revenues

Room

$

147,277

$

158,400

$

167,194

$

115,515

$

588,386

Food and beverage

65,847

63,476

74,307

42,911

246,541

Other operating

31,020

22,438

18,711

24,360

96,529

Total revenues

244,144

244,314

260,212

182,786

931,456

Operating Expenses

Room

38,691

38,791

38,626

30,425

146,533

Food and beverage

48,187

47,181

48,304

34,233

177,905

Other expenses

84,308

88,746

87,269

75,023

335,346

Corporate overhead

7,936

7,879

8,717

10,714

35,246

Depreciation and amortization

32,393

31,750

31,720

31,711

127,574

Impairment loss

3,466

3,466

Total operating expenses

214,981

214,347

214,636

182,106

826,070

Interest and other income

476

270

116

4,380

5,242

Interest expense

(11,717)

(9,269)

(5,938)

(4,964)

(31,888)

Loss on extinguishment of debt

(784)

(230)

(1,014)

Income (loss) before income taxes

17,922

20,184

39,754

(134)

77,726

Income tax (provision) benefit, net

(485)

290

(28)

(136)

(359)

Net income (loss)

$

17,437

$

20,474

$

39,726

$

(270)

$

77,367

Comparable Hotel Adjusted EBITDAre (2)

$

61,866

$

69,422

$

87,308

$

42,687

$

261,283

Comparable Adjusted EBITDAre (3)

$

68,777

$

63,848

$

80,031

$

37,103

$

249,759

Comparable Adjusted FFO attributable to common stockholders (4)

$

53,733

$

51,264

$

69,051

$

26,183

$

200,231

Comparable Adjusted FFO attributable to common stockholders per diluted share (4)

$

0.26

$

0.25

$

0.34

$

0.13

$

0.97

*Footnotes on page 11

COMPARABLE CORPORATE FINANCIAL INFORMATION

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Supplemental Financial Information
August 4, 2023

Comparable Consolidated Statements of Operations

Q4 2019 – Q1 2019, FY 2019

Quarter Ended (1)

Year Ended (1)

(Unaudited and in thousands, except per share data)

December 31,

September 30,

June 30,

March 31,

December 31,

2019

    

2019

    

2019

    

2019

    

2019

Revenues

Room

$

140,388

$

145,477

$

154,320

$

140,689

$

580,874

Food and beverage

59,112

53,525

67,089

63,338

243,064

Other operating

17,415

17,523

16,271

15,124

66,333

Total revenues

216,915

216,525

237,680

219,151

890,271

Operating Expenses

Room

36,422

37,604

37,604

35,979

147,609

Food and beverage

40,345

38,763

42,286

41,704

163,098

Other expenses

73,100

71,415

73,549

73,328

291,392

Corporate overhead

7,275

7,395

8,078

7,516

30,264

Depreciation and amortization

28,231

28,315

27,684

27,541

111,771

Total operating expenses

185,373

183,492

189,201

186,068

744,134

Interest and other income

3,060

3,762

4,811

4,924

16,557

Interest expense

(6,880)

(9,074)

(11,634)

(10,149)

(37,737)

Income before income taxes

27,722

27,721

41,656

27,858

124,957

Income tax (provision) benefit, net

(1,034)

749

(2,676)

3,112

151

Net income

$

26,688

$

28,470

$

38,980

$

30,970

$

125,108

Comparable Hotel Adjusted EBITDAre (2)

$

67,146

$

68,778

$

84,305

$

68,415

$

288,644

Comparable Adjusted EBITDAre (3)

$

64,653

$

66,936

$

82,652

$

67,767

$

282,008

*Footnotes on page 11

COMPARABLE CORPORATE FINANCIAL INFORMATION

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Supplemental Financial Information
August 4, 2023

Comparable Consolidated Statements of Operations

Footnotes

(1)Excludes results for the Courtyard by Marriott Los Angeles, the Renaissance Harborplace, the Renaissance Los Angeles Airport, the Renaissance Westchester, the Embassy Suites La Jolla and the Hyatt Centric Chicago Magnificent Mile sold in October 2019, July 2020, December 2020, October 2021, December 2021 and February 2022, respectively, along with the Embassy Suites Chicago and the Hilton Garden Inn Chicago Downtown/Magnificent Mile sold in March 2022. Also excludes results and the gain on extinguishment of debt due to the resolution of potential employee-related obligations for the Hilton Times Square in connection with the assignment-in-lieu agreement executed in December 2020 between the Company and the hotel’s mortgage holder which transferred the Company’s leasehold interest in the hotel to the mortgage holder, and the elimination of interest expense on the mortgage loan secured by the Renaissance Washington DC due to its repayment in December 2020. Includes prior ownership results for The Confidante Miami Beach acquired by the Company in June 2022, adjusted for the Company's pro forma depreciation expense.
(2)Comparable Hotel Adjusted EBITDAre reconciliations for the second quarters of 2023, 2022 and 2019 can be found later in this presentation. Additional details can be found in our earnings release, furnished in Exhibit 99.1 to our 8-K filed on August 4, 2023. Comparable Hotel Adjusted EBITDAre presented for the first and second quarters of 2023 and the four quarters and year ended December 31, 2022 includes the 15 Hotel Portfolio. Comparable Hotel Adjusted EBITDAre presented for the four quarters and year ended December 31, 2019 includes the 13 Hotel Portfolio.
(3)Comparable Adjusted EBITDAre reconciliations for each of the periods included in this presentation can be found in the following pages and reflect the adjustments noted in Footnote 1 above, along with the elimination of noncontrolling interest due to the Company's acquisition of the outside 25% ownership interest in the joint venture that owned the Hilton San Diego Bayfront in June 2022.
(4)Comparable Adjusted FFO attributable to common stockholders and Comparable Adjusted FFO attributable to common stockholders per diluted share reconciliations for the 2023 and 2022 periods included in this presentation can be found in the following pages and reflect the adjustments noted in Footnote 1 above to exclude the results of sales/disposals of hotels, eliminate the interest expense on the mortgage loan secured by the Renaissance Washington DC and to include prior ownership results for The Confidante Miami Beach adjusted for the Company’s pro forma depreciation expense. In addition, the reconciliations include the elimination of noncontrolling interest noted in Footnote 3 above, along with repurchases totaling 10,245,324 shares of common stock in the first, second, third and fourth quarters of 2022 and 2,266,384 shares of common stock in the first and second quarters of 2023.

COMPARABLE CORPORATE FINANCIAL INFORMATION

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Supplemental Financial Information
August 4, 2023

Comparable Reconciliation of Net Income to EBITDAre and Adjusted EBITDAre

Q2 2023 – Q3 2022, Trailing 12 Months

Quarter Ended

Trailing 12 Months

June 30,

March 31,

December 31,

September 30,

Ended

(In thousands)

2023

2023

2022

2022

June 30, 2023

Net income

$

43,078

$

21,087

$

17,463

$

20,488

$

102,116

Operations held for investment:

Depreciation and amortization

32,397

32,342

32,393

31,750

128,882

Interest expense

9,223

13,794

11,717

9,269

44,003

Income tax provision (benefit), net

803

358

485

(290)

1,356

Impairment loss - depreciable assets

1,379

1,379

EBITDAre

85,501

67,581

63,437

61,217

277,736

Operations held for investment:

Amortization of deferred stock compensation

3,325

2,427

2,230

2,230

10,212

Amortization of right-of-use assets and obligations

(17)

(52)

(359)

(350)

(778)

Amortization of contract intangibles, net

(18)

(18)

(18)

(19)

(73)

(Gain) loss on extinguishment of debt, net

(12)

(9,909)

(26)

770

(9,177)

Hurricane-related insurance restoration proceeds

(3,722)

(3,722)

Property-level severance

729

729

Costs associated with financing no longer pursued

697

697

Impairment loss - right-of-use asset

2,087

2,087

Adjustments to EBITDAre, net

(444)

(7,552)

5,340

2,631

(25)

Comparable Adjusted EBITDAre

$

85,057

$

60,029

$

68,777

$

63,848

$

277,711

COMPARABLE CORPORATE FINANCIAL INFORMATION

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Supplemental Financial Information
August 4, 2023

Comparable Reconciliation of Net Income to FFO and Adjusted FFO Attributable to Common Stockholders

Q2 2023 – Q3 2022, Trailing 12 Months

Quarter Ended

Trailing 12 Months

June 30,

March 31,

December 31,

September 30,

Ended

(In thousands, except per share data)

2023

2023

2022

2022

June 30, 2023

Net income

$

43,078

$

21,087

$

17,463

$

20,488

$

102,116

Preferred stock dividends

(3,768)

(3,768)

(3,350)

(3,351)

(14,237)

Operations held for investment:

Real estate depreciation and amortization

32,240

32,191

32,023

31,313

127,767

FFO attributable to common stockholders

71,550

49,510

46,136

48,450

215,646

Operations held for investment:

Amortization of deferred stock compensation

3,325

2,427

2,230

2,230

10,212

Real estate amortization of right-of-use assets and obligations

(128)

(119)

(287)

(288)

(822)

Amortization of contract intangibles, net

85

83

78

141

387

Noncash interest on derivatives, net

(3,711)

1,832

710

(39)

(1,208)

(Gain) loss on extinguishment of debt, net

(12)

(9,909)

(26)

770

(9,177)

Hurricane-related insurance restoration proceeds

(3,722)

(3,722)

Property-level severance

729

729

Costs associated with financing no longer pursued

697

697

Impairment losses - right-of-use and depreciable assets

3,466

3,466

Adjustments to FFO attributable to common stockholders, net

(4,163)

(5,686)

7,597

2,814

562

Comparable Adjusted FFO attributable to common stockholders

$

67,387

$

43,824

$

53,733

$

51,264

$

216,208

Comparable Adjusted FFO attributable to common stockholders per diluted share

$

0.33

$

0.21

$

0.26

$

0.25

$

1.05

Basic weighted average shares outstanding

206,181

207,035

209,097

211,010

208,331

Shares associated with unvested restricted stock awards

733

501

449

594

569

Diluted weighted average shares outstanding

206,914

207,536

209,546

211,604

208,900

Equity transactions (1)

(59)

(1,128)

(3,332)

(5,245)

(2,441)

Comparable diluted weighted average shares outstanding

206,855

206,408

206,214

206,359

206,459

(1)Equity Transactions represent repurchases totaling 880,577 and 2,249,764 shares of common stock in the third and fourth quarters of 2022, respectively, along with the repurchases of 1,964,923 and 301,461 shares of common stock in the first and second quarters of 2023.

COMPARABLE CORPORATE FINANCIAL INFORMATION

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Supplemental Financial Information
August 4, 2023

Comparable Reconciliation of Net Income to EBITDAre and Adjusted EBITDAre

Q4 2022 – Q1 2022, FY 2022

Quarter Ended

Year Ended

December 31,

September 30,

June 30,

March 31,

December 31,

(In thousands)

2022

2022

2022

2022

2022

Net income

$

17,463

$

20,488

$

37,692

$

15,123

$

90,766

Operations held for investment:

Depreciation and amortization

32,393

31,750

30,893

31,360

126,396

Interest expense

11,717

9,269

5,938

5,081

32,005

Income tax provision (benefit), net

485

(290)

28

136

359

Gain on sale of assets

(22,946)

(22,946)

Impairment loss - depreciable assets

1,379

1,379

EBITDAre

63,437

61,217

74,551

28,754

227,959

Operations held for investment:

Amortization of deferred stock compensation

2,230

2,230

2,853

3,578

10,891

Amortization of right-of-use assets and obligations

(359)

(350)

(354)

(346)

(1,409)

Amortization of contract intangibles, net

(18)

(19)

(18)

(6)

(61)

Finance lease obligation interest - cash ground rent

(117)

(117)

(Gain) loss on extinguishment of debt, net

(26)

770

(21)

213

936

Hurricane-related losses net of insurance restoration proceeds

138

(2,893)

(2,755)

Property-level severance

729

729

Costs associated with financing no longer pursued

697

697

Impairment loss - right-of-use asset

2,087

2,087

Noncontrolling interest:

Income from consolidated joint venture attributable to noncontrolling interest

(2,343)

(1,134)

(3,477)

Depreciation and amortization

(666)

(790)

(1,456)

Interest expense

(206)

(168)

(374)

Amortization of right-of-use asset and obligation

60

72

132

Adjustments to EBITDAre, net

5,340

2,631

(557)

(1,591)

5,823

Adjusted EBITDAre, excluding noncontrolling interest

68,777

63,848

73,994

27,163

233,782

Sold hotel Adjusted EBITDAre (1)

2,172

2,172

Acquisition hotel Adjusted EBITDAre (2)

6,037

7,768

13,805

Comparable Adjusted EBITDAre

$

68,777

$

63,848

$

80,031

$

37,103

$

249,759

*Footnotes on page 16

COMPARABLE CORPORATE FINANCIAL INFORMATION

Page 14


Graphic

Supplemental Financial Information
August 4, 2023

Comparable Reconciliation of Net Income to FFO and Adjusted FFO Attributable to Common Stockholders

Q4 2022Q1 2022, FY 2022

Quarter Ended

Year Ended

December 31,

September 30,

June 30,

March 31,

December 31,

(In thousands, except per share data)

2022

2022

2022

2022

2022

Net income

$

17,463

$

20,488

$

37,692

$

15,123

$

90,766

Preferred stock dividends

(3,350)

(3,351)

(3,773)

(3,773)

(14,247)

Operations held for investment:

Real estate depreciation and amortization

32,023

31,313

30,456

31,027

124,819

Gain on sale of assets

(22,946)

(22,946)

Noncontrolling interest:

Income from consolidated joint venture attributable to noncontrolling interest

(2,343)

(1,134)

(3,477)

Real estate depreciation and amortization

(666)

(790)

(1,456)

FFO attributable to common stockholders

46,136

48,450

61,366

17,507

173,459

Operations held for investment:

Amortization of deferred stock compensation

2,230

2,230

2,853

3,578

10,891

Real estate amortization of right-of-use assets and obligations

(287)

(288)

(294)

(286)

(1,155)

Amortization of contract intangibles, net

78

141

143

60

422