8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the

Securities Exchange Act of 1934

Date of Report (date of earliest event reported) – August 10, 2020

EXTENDED STAY AMERICA, INC.

(Exact name of registrant as specified in its charter)

Delaware	001-36190	46-3140312
(State or other jurisdiction of incorporation or organization)	(Commission File Number)	(I.R.S. Employer Identification Number)
11525 N. Community House Road, Suite 100 Charlotte
North Carolina
28277
(Address of principal executive offices, zip code)

Registrant’s telephone number, including area code (980) 345-1600

ESH HOSPITALITY, INC.

(Exact name of registrant as specified in its charter)

Delaware	001-36191	27-3559821
(State or other jurisdiction of incorporation or organization)	(Commission File Number)	(I.R.S. Employer Identification Number)
11525 N. Community House Road, Suite 100 Charlotte
North Carolina
28277
(Address of principal executive offices, zip code)

Registrant’s telephone number, including area code (980) 345-1600

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock, par value $0.01 per share, of	STAY	Nasdaq Global Select Market
Extended Stay America, Inc. and Class B
Common Stock, par value $0.01 per share, of
ESH Hospitality, Inc., which are attached
and trade together as a Paired Share.

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrants under any of the following provisions:

☐
Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

☐
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

☐ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

☐
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4c))

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Item 2.02. Results of Operations and Financial Condition.

On August 10, 2020, Extended Stay America, Inc. and ESH Hospitality, Inc. issued an earnings release announcing their results of operations for the three and six months ended June 30, 2020. A copy of the earnings release is furnished as Exhibit 99.1 to this Current Report on Form 8-K and is incorporated herein by reference in this Item 2.02.

The information contained under Item 2.02 of this Current Report on Form 8-K (including Exhibit 99.1) is being furnished and shall not be deemed to be “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended (the “Securities Act”), or the Exchange Act, except as shall be expressly set forth by specific reference in such a filing.

Item 7.01. Regulation FD Disclosure.

On August 11, 2020, Extended Stay America, Inc. and ESH Hospitality, Inc. will hold a conference call announcing their results of operations for the three and six months ended June 30, 2020. A copy of management’s presentation materials is furnished as Exhibit 99.2 to this Current Report on Form 8-K and is incorporated herein by reference in this Item 7.01.

The information contained under Item 7.01 of this Current Report on Form 8-K (including Exhibit 99.2) is being furnished and shall not be deemed to be “filed” for purposes of Section 18 of the Exchange Act, or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference in any filing under the Securities Act or the Exchange Act, except as shall be expressly set forth by specific reference in such a filing.

Item 9.01. Financial Statements and Exhibits.

(d) Exhibits.

Exhibit Number	Exhibit Description
99.1	Earnings release of Extended Stay America, Inc. and ESH Hospitality, Inc., dated August 10, 2020, announcing results for the three and six months ended June 30, 2020.
99.2	Management’s presentation materials, dated August 10, 2020.
104	Cover Page Interactive Data File - the cover page XBRL tags are embedded within the Inline XBRL document.

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, each of the Registrants has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

	EXTENDED STAY AMERICA, INC.
Date: May 6, 2020	By:	/s/ Christopher N. Dekle
		Name: Christopher N. Dekle
		Title: General Counsel and Corporate Secretary

	ESH HOSPITALITY, INC.
Date: May 6, 2020	By:	/s/ Christopher N. Dekle
		Name: Christopher N. Dekle
		Title: General Counsel and Corporate Secretary

EX-99.1

EXTENDED STAY AMERICA ANNOUNCES SECOND QUARTER 2020 RESULTS

-Net loss of $8.8 million

-Adjusted EBITDA¹ of $74.4 million

-Comparable system-wide RevPAR decrease of 28.7%

CHARLOTTE, N.C. - August 10, 2020 (GlobeNewswire) — Extended Stay America, Inc. and ESH Hospitality, Inc. (NASDAQ:STAY) (together, the “Company”) today announced consolidated results for the three and six months ended June 30, 2020.

Second Quarter 2020 Highlights

•Net loss of $8.8 million

•Total revenues of $230.8 million

•Comparable system-wide Revenue Per Available Room (“RevPAR”) declined 28.7% to $38.38

•Comparable system-wide occupancy of 69.6%

•Adjusted EBITDA¹ of $74.4 million

•Adjusted Funds From Operations ("Adjusted FFO")¹ of $0.17 per diluted Paired Share

•Adjusted Paired Share Loss¹ of $(0.04) per diluted Paired Share

•Comparable system-wide RevPAR index of 141, a 4,640 basis point increase

Extended Stay America’s President and Chief Executive Officer Bruce Haase, commented, “I am proud of our Company’s performance during these unprecedented times, with our second quarter comparable system-wide RevPAR decline of 28.7% being significantly better than any public hotel company in the US. System-wide occupancy levels have improved significantly off April lows to over 80% in recent weeks – approaching pre-pandemic 2019 levels – and many markets are now running positive RevPAR growth over last year. This performance illustrates the strength of our unique business model and our singular focus on the extended stay segment, unlike anyone else in the industry.”

“Since June, STAY is generating positive cash flow, and with July results showing continued improvement, we repaid our $350 million ESH REIT revolver last week. While others in the industry have deeply cut management and staff, ESA has continued to invest for the long-term growth of the Company.”

Financial and Operating Results

Total revenues for the three months ended June 30, 2020 were $230.8 million, a decrease of 28.7% over the same period in 2019 due to the impact of the COVID-19 pandemic. Total revenues for the first half of 2020 were $497.1 million, a decrease of 17.3% compared to the same period in 2019.

¹ See “Disclosure Regarding Non-GAAP Financial Measures” for an explanation of non-GAAP measures included in this release (i.e., Hotel Operating Profit, Hotel Operating Margin, EBITDA, Adjusted EBITDA, Funds from Operations ("FFO"), Adjusted FFO, Adjusted FFO per diluted Paired Share, Paired Share (Loss) Income, Adjusted Paired Share (Loss) Income and Adjusted Paired Share (Loss) Income per diluted Paired Share).

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Comparable system-wide RevPAR for the three months ended June 30, 2020 declined 28.7% over the same period in 2019 to $38.38, driven by a 18.3% decline in Average Daily Rate (“ADR”) and a 1,010 basis point decrease in occupancy to 69.6%. Comparable system-wide RevPAR declined 34.7%, 28.2% and 23.9% in the months of April, May and June 2020, respectively, compared to the same periods in 2019. After bottoming in mid-April, RevPAR increased each week for the remainder of the quarter. Comparable system-wide RevPAR for the first half of 2020 declined 18.1% to $41.18.

Hotel Operating Margin¹for the three months ended June 30, 2020 was 41.7% compared to 54.4% in the same period in 2019 due a decrease in RevPAR caused by the COVID-19 pandemic. Hotel Operating Margin improved from 35.2% in April 2020 to June 2020 to 45.4%. Hotel operating expenses during the second quarter of 2020 declined by 9.2% from the same period in 2019, or approximately 10% on a comparable basis. Hotel Operating Margin for the first half of 2020 was 43.8% compared to 52.4% in the same period of 2019, driven by a decrease in RevPAR due to the COVID-19 pandemic.

Net loss for the three months ended June 30, 2020 was $8.8 million compared to net income of $59.7 million for the same period in 2019. The decline in net income was due to a decline in comparable system-wide RevPAR as a result of the COVID-19 pandemic, an increase in depreciation and amortization expense, and an increase in net interest expense, partially offset by a decrease in income tax expense. Net loss for the first half of 2020 was $0.9 million, compared to net income of $88.1 million for the same period in 2019.

Adjusted EBITDA for the three months ended June 30, 2020 was $74.4 million, a decline of 51.6% compared to the same period in 2019. The decline in Adjusted EBITDA was due to a decline in Comparable system-wide RevPAR. Adjusted EBITDA for the quarter excludes non-cash equity-based compensation expense of $1.9 million, $1.6 million in loss on disposal of assets and $1.0 million in other expenses. Adjusted EBITDA for the first half of 2020 was $172.1 million compared to $270.0 million in the same period of 2019.

Adjusted FFO for the three months ended June 30, 2020 was $30.5 million, or $0.17 per diluted Paired Share, compared to $99.8 million, or $0.53 per diluted Paired Share in the same period in 2019. The decline in Adjusted FFO was due to a decline in comparable system-wide RevPAR due to the impact of the COVID-19 pandemic. Adjusted FFO for the first half of 2020 was $85.6 million, or $0.48 per diluted Paired Share, compared to $168.3 million, or $0.89 per diluted Paired Share, for the first half of 2019. Adjusted FFO, a non-GAAP measure, represents funds from operations, as adjusted, attributable to the consolidated enterprise, whose representative equity security is a Paired Share. A Paired Share entitles its holder to participate in 100% of the common equity and earnings of both Extended Stay America, Inc. and ESH Hospitality, Inc.

Adjusted Paired Share Loss for the three months ended June 30, 2020 was $6.7 million, or ($0.04) per diluted Paired Share, compared to $61.2 million in Adjusted Paired Share Income, or $0.32 per diluted Paired Share, for the same period in 2019. The decline in Adjusted Paired Share (Loss) Income per diluted Paired Share was due to a decline in comparable system-wide RevPAR, an increase in depreciation and amortization expense and an increase in net interest expense, partially offset by a decline in income tax expense.Adjusted Paired Share Income for the first half of 2020 was $5.5 million, or $0.03 per diluted Paired

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Share, compared to $90.7 million, or $0.48 per diluted Paired Share, in the same period of 2019. Adjusted Paired Share Income, a non-GAAP measure, represents net income, as adjusted, attributable to the consolidated enterprise, whose representative equity security is a Paired Share.

Capital Expenditures and Balance Sheet

The Company invested $50.7 million in capital expenditures during the second quarter of 2020. This included $1.8 million in renovation capital and $21.8 million in capital for hotel development. For the first half of 2020, the Company invested $105.3 million in capital expenditures.

As of June 30, 2020, the company had $682.4 million in cash and equivalents, including $14.9 million in restricted cash, and total debt outstanding was $3.08 billion. Since the end of the second quarter, the Company has repaid its $350.0 million revolver at ESH Hospitality, Inc. in full using unrestricted cash on hand due to the strong increases in RevPAR and the improvement in the Company’s cash flow profile in recent months.

Hotel and Development Pipeline

As of June 30, 2020, the Company had a pipeline of 69 hotels representing approximately 8,400 rooms. Three Company-owned hotels and one franchised hotel opened during the second quarter.

Company Owned Pipeline & Recently Opened Hotels as of June 30, 2020
Under Option		Pre-Development		Under Construction		Total Pipeline		Opened YTD
# Hotels	# Rooms	# Hotels	# Rooms	# Hotels	# Rooms	# Hotels	# Rooms	# Hotels	# Rooms
0	0	4	504	7	888	11	1,392	4	488
Third Party Pipeline & Recently Opened Hotels as of June 30, 2020
Commitments		Applications		Executed		Total Pipeline		Opened YTD
# Hotels	# Rooms	# Hotels	# Rooms	# Hotels	# Rooms	# Hotels	# Rooms	# Hotels	# Rooms
27	3,348	4	464	27	3,184	58	6,996	2	205

Definitions
Under Option	Locations with a signed purchase and sale agreement
Pre-Development	Land purchased, permitting and/or site work
Under Construction	Hotel is under construction
Commitments	Signed commitment to build or convert a certain number of hotels by a third party, generally associated with a prior portfolio sale
Applications	Third party filed franchise application with deposit
Executed	Franchise and development application approved, geography identified and deposits paid, various stages of pre-development and/or under construction

Distributions and Share Repurchases

On August 10, 2020, the Board of Directors of ESH Hospitality, Inc. declared a $0.01 distribution to ESH Class A and B shareholders payable on September 8, 2020 to shareholders of record on August 25, 2020. Management and the Boards of

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Directors of Extended Stay America, Inc. and ESH Hospitality, Inc. intend to review future Company distributions as pandemic and business conditions continue to evolve. ESH Hospitality, Inc. will continue to distribute at least 90% of its pre-tax earnings to maintain its REIT status.

The Company did not repurchase any Paired Shares during the second quarter and has $101.1 million in authorization outstanding.

Q3 and Full Year 2020 Outlook Update

Third Quarter of 2020
In millions, except %	Low	High
Comparable system-wide RevPAR	-21%	-18%
Company owned RevPAR	-22%	-19%
Adjusted EBITDA	$98	$105

Full Year 2020
In millions	Low	High
Net interest expense	$133	$133
Depreciation and amortization	$198	$203
Capital expenditures	$160	$190

Due to the significant uncertainty surrounding the COVID-19 pandemic length, severity and the pace of economic recovery, the Company will not provide a RevPAR outlook or an Adjusted EBITDA outlook for the full year 2020 at this time. Outlook for Q3 2020 and Full Year 2020 is as of August 10, 2020. Performance for the third quarter is subject to risks and uncertainties, in particular the ongoing impact of the COVID-19 pandemic, which could cause actual results to deviate materially and adversely from current trends and expectations. In such event, the Company does not expect to, and undertakes no obligation to, announce changes in expectations prior to the announcement of actual third quarter results.

Webcast and Conference Call Details

The Company will host a conference call on Tuesday, August 11, 2020 at 8:30 a.m. Eastern Time.The conference call will be webcast simultaneously in the Investor Relations section of the Company’s website at www.aboutstay.com.A replay of the call will be available for 90 days following the webcast on the Company’s website. Alternatively, the conference call can be accessed by dialing 1-877-705-6003 for domestic callers or 1-201-493-6725 for international callers.A telephone replay will be available from shortly after the call until August 18, 2020, and can be accessed by dialing 1-844-512-2921 for domestic callers or 1-412-317-6671 for international callers. The passcode for the replay is 13707704.

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RevPAR Index

RevPAR Index is stated as a percentage and calculated by comparing RevPAR for owned hotels or system-wide hotels to the aggregate RevPAR of a group of competing hotels generally in the same market. As such, the RevPAR Index is only a measure of RevPAR relative to certain competing hotels and not a measure of our absolute RevPAR or profitability. We subscribe to STR, Inc. ("STR"), an independent third-party service, which collects and compiles the data used to calculate RevPAR Index. We select the competing hotels included in the RevPAR Index calculation subject to STR's guidelines. The competing hotels included in STR guidelines will generally include certain hotels that are not considered part of the extended stay lodging segment of the hospitality industry and, instead, fall within the category of short-term stay hotels. STR does not endorse the Company, or any other company, and STR data should not be viewed as investment advice or as a recommendation to take a particular course of action.

Disclosure Regarding Non-GAAP Financial Measures

Hotel Operating Profit, Hotel Operating Margin, EBITDA, Adjusted EBITDA, FFO, Adjusted FFO, Adjusted FFO per diluted Paired Share, Paired Share Income, Adjusted Paired Share Income and Adjusted Paired Share Income per diluted Paired Share (collectively, the “Non-GAAP Financial Measures”), which are detailed in the reconciliation tables that accompany this release, are used by the Company as supplemental performance measures. The Company believes these measures provide useful information to investors regarding our results of operations and allow investors to evaluate the ongoing operating performance of our hotels and facilitate comparisons between the Company and other lodging companies, hotel owners and capital-intensive companies, including those which include a REIT as part of their legal entity structure. The Non-GAAP Financial Measures are not recognized terms under U.S. GAAP. These measures as presented may not be comparable to measures calculated by other companies. These measures should not be considered as alternative measures of, or superior to, operating profit, net income, net income per share or any other measure of the Company, Extended Stay America, Inc. or ESH Hospitality, Inc. calculated in accordance with U.S. GAAP. The Company’s presentation of the Non-GAAP Financial Measures does not replace the presentation of the Company’s consolidated financial statements and other disclosures prepared in accordance with U.S. GAAP.

Forward Looking Statements

This release contains forward-looking statements within the meaning of the federal securities laws. These statements include, but are not limited to, statements related to our expectations regarding our business performance, financial results, liquidity and capital resources, capital expenditures, Q3 2020 and full year outlook, distribution policy, plans, goals, beliefs, business trends and future events, as well as the impact of the COVID-19 pandemic, its effects on the foregoing, government actions taken in response to the pandemic and actions that we have or plan to take in response to the pandemic and other non-historical statements. Forward looking statements involve known and unknown risks, uncertainties and other factors that may cause the Company’s actual results or performance to differ from those projected in the forward-looking statements, possibly materially. For a description of factors that may cause the Company’s actual results or performance to differ from projected results or performance implied by forward-looking statements, please review the information under the headings “Cautionary Note Regarding Forward-Looking Statements” and “Risk Factors” included in the Company’s combined annual report on Form 10-K filed with the Securities and Exchange Commission (“SEC”) on February 26, 2020 and other documents of the Company on file with or furnished to the SEC, including the Company’s combined quarterly report on Form 10-Q filed on August 10, 2020. Any forward-looking statements made in this release are qualified by these cautionary statements, and there can be no assurance that the actual

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results or developments anticipated by the Company will be realized or, even if substantially realized, will have the expected consequences to, or effects on, the Company, its business or operations.Except as required by law, the Company undertakes no obligation to update publicly or revise any forward-looking statement, whether as a result of new information, future developments or otherwise. We caution you that actual results may differ materially from what is expressed, implied or forecasted by the Company’s forward-looking statements.

About Extended Stay America

Extended Stay America® is the leading brand in the mid-priced extended stay segment in the U.S. with 636 hotels.ESH Hospitality, Inc. (“ESH”), a subsidiary of Extended Stay America, Inc. (“ESA”), is the largest lodging REIT in North America by unit and room count, with 561 hotels and over 62,000 rooms in the U.S. ESA also manages or franchises an additional 75 Extended Stay America® hotels. Visit www.esa.com for more information.

Contacts

Investors or Media:

Rob Ballew

(980) 345-1546

investorrelations@esa.com 

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EXTENDED STAY AMERICA, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2020 AND 2019
(In thousands, except per share data)
(Unaudited)
Three Months Ended						Six Months Ended
June 30,						June 30,
2020		2019		% Variance		2020		2019		% Variance
					REVENUES:
$	219,851	$	311,614	(29.4)%	Room revenues	$	474,315	$	578,660	(18.0)%
6,320		6,070		4.1%	Other hotel revenues	13,088		11,373		15.1%
1,218		1,447		(15.8)%	Franchise and management fees	2,497		2,672		(6.5)%
227,389		319,131		(28.7)%		489,900		592,705		(17.3)%
3,445		4,526		(23.9)%	Other revenues from franchised and managed properties	7,235		8,621		(16.1)%
230,834		323,657		(28.7)%	Total revenues	497,135		601,326		(17.3)%
					OPERATING EXPENSES:
133,435		146,907		(9.2)%	Hotel operating expenses	278,730		284,198		(1.9)%
23,103		22,287		3.7%	General and administrative expenses	47,041		45,314		3.8%
51,042		49,017		4.1%	Depreciation and amortization	101,562		97,795		3.9%
675		—		n/a	Impairment of long-lived assets	675		—		n/a
208,255		218,211		(4.6)%		428,008		427,307		0.2%
4,083		4,996		(18.3)%	Other expenses from franchised and managed properties	8,290		9,643		(14.0)%
212,338		223,207		(4.9)%	Total operating expenses	436,298		436,950		(0.1)%
1		1		—	OTHER INCOME	3		28		(89.3)%
18,497		100,451		(81.6)%	INCOME FROM OPERATIONS	60,840		164,404		(63.0)%
(302)		(171)		76.6%	OTHER NON-OPERATING (INCOME) EXPENSE	401		(349)		(214.9)%
33,621		29,766		13.0%	INTEREST EXPENSE, NET	66,306		59,370		11.7%
(14,822)		70,856		(120.9)%	(LOSS) INCOME BEFORE INCOME TAX EXPENSE	(5,867)		105,383		(105.6)%
(6,052)		11,198		(154.0)%	INCOME TAX (BENEFIT) EXPENSE	(4,942)		17,321		(128.5)%
(8,770)		59,658		(114.7)%	NET (LOSS) INCOME	(925)		88,062		(101.1)%
(3,593)		(6,161)		(41.7)%	NET INCOME ATTRIBUTABLE TO NONCONTROLLING INTERESTS	(6,884)		(12,631)		(45.5)%
$	(12,363)	$	53,497	(123.1)%	NET (LOSS) INCOME ATTRIBUTABLE TO EXTENDED STAY AMERICA, INC. COMMON SHAREHOLDERS	$	(7,809)	$	75,431	(110.4)%
$	(0.07)	$	0.28	(124.6)%	NET (LOSS) INCOME PER EXTENDED STAY AMERICA, INC. COMMON SHARE - DILUTED	$	(0.04)	$	0.40	(111.0)%
177,551		188,813			WEIGHTED-AVERAGE EXTENDED STAY AMERICA, INC. COMMON SHARES OUTSTANDING - DILUTED	177,771		188,695
					CONSOLIDATED BALANCE SHEET DATA
					AS OF JUNE 30, 2020 AND DECEMBER 31, 2019
					(In thousands)
					(unaudited)
						June 30,		December 31,
						2020		2019
					Cash and cash equivalents	$	667,553	$	346,812
					Restricted cash	$	14,893	$	14,858
					Total assets	$	4,348,239	$	4,030,596
					Total debt, net of unamortized deferred financing costs and debt discounts (1)	$	3,033,718	$	2,639,766
					Total equity	$	1,102,368	$	1,176,270
					(1) Unamortized deferred financing costs and debt discounts totaled $42.9 million and $46.7 million as of June 30, 2020 and December 31, 2019, respectively.

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EXTENDED STAY AMERICA, INC.
OPERATING METRICS
FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2020 AND 2019
(Unaudited)
COMPARABLE SYSTEM-WIDE OPERATING METRICS (1)
Three Months Ended				Six Months Ended
June 30,				June 30,
2020	2019	Variance		2020	2019	Variance
625	625	—	Number of hotels (as of June 30)	624	624	—
68,815	68,815	—	Number of rooms (as of June 30)	68,700	68,700	—
69.6%	79.7%	(1010) bps	Comparable System-Wide Occupancy(1)	70.7%	75.6%	(490) bps
$55.17	$67.53	(18.3)%	Comparable System-Wide ADR(1)	$58.22	$66.56	(12.5)%
$38.38	$53.84	(28.7)%	Comparable System-Wide RevPAR(1)	$41.18	$50.29	(18.1)%

COMPARABLE COMPANY-OWNED OPERATING METRICS (2)
Three Months Ended				Six Months Ended
June 30				June 30
2020	2019	Variance		2020	2019	Variance
553	553	—	Number of hotels (as of June 30)	553	553	—
61,445	61,445	—	Number of rooms (as of June 30)	61,445	61,445	—
68.8%	79.9%	(1110) bps	Comparable Company-Owned Occupancy(2)	70.1%	75.7%	(560) bps
$56.61	$69.63	(18.7)%	Comparable Company-Owned ADR(2)	$59.93	$68.63	(12.7)%
$38.97	$55.62	(29.9)%	Comparable Company-Owned RevPAR(2)	$42.04	$51.94	(19.1)%

COMPANY-OWNED OPERATING METRICS(3)
Three Months Ended				Six Months Ended
June 30,				June 30,
2020	2019	Variance		2020	2019	Variance
561	554	7	Number of hotels (as of June 30)	561	554	7
62.421	61.552	869	Number of rooms (as of June 30)	62.421	61.552	869
68.7%	79.9%	(1120) bps	Company-Owned Occupancy(3)	70.1%	75.7%	(560) bps
$56.68	$69.65	(18.6)%	Company-Owned ADR(3)	$60.07	$68.64	(12.5)%
$38.96	$55.63	(30.0)%	Company-Owned RevPAR(3)	$42.09	$51.94	(19.0)%
(1) Includes hotels owned, franchised or managed for the full three and six months ended June 30, 2020 and 2019, respectively.
(2) Includes hotels owned and operated by the Company for the full three and six months ended June 30, 2020 and 2019, respectively.
(3) Includes results of operations based on the Company's owned and operated hotels during the periods presented, which is summarized below:

Date	Number of Hotels Acquired or Opened	Number of Rooms	Number of Owned Hotels(1)	Number of Owned Rooms(1)
January 1, 2019	—	—	554	61,552
November 2019	1	121	555	61,673
December 2019	2	260	557	61,933
March 2020	1	120	558	62,053
April 2020	1	120	559	62,173
June 2020	2	248	561	62,421
(1) As of end of period.

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EXTENDED STAY AMERICA, INC.
NON-GAAP RECONCILIATION OF NET (LOSS) INCOME TO HOTEL OPERATING PROFIT AND HOTEL OPERATING MARGIN
FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2020 AND 2019
(In thousands)
(Unaudited)
Three Months Ended								Six Months Ended
June 30,								June 30,
2020			2019			Variance		2020			2019			Variance
$	(8,770)		$	59,658		(114.7)%	Net (loss) income	$	(925)		$	88,062		(101.1)%
(6,052)			11,198			(154.0)%	Income tax (benefit) expense	(4,942)			17,321			(128.5)%
33,621			29,766			13.0%	Interest expense, net	66,306			59,370			11.7%
(302)			(171)			76.6%	Other non-operating (income) expense	401			(349)			(214.9)%
(1)			(1)			—%	Other income	(3)			(28)			(89.3)%
675			—			n/a	Impairment of long-lived assets	675			—			n/a
51,042			49,017			4.1%	Depreciation and amortization	101,562			97,795			3.9%
23,103			22,287			3.7%	General and administrative expenses	47,041			45,314			3.8%
1,636			2,001			(18.2)%	Loss on disposal of assets(1)	4,979			3,377			47.4%
(1,218)			(1,447)			(15.8)%	Franchise and management fees	(2,497)			(2,672)			(6.5)%
638			470			35.7%	System services loss, net	1,055			1,022			3.2%
$	94,372		$	172,778		(45.4)%	Hotel Operating Profit	$	213,652		$	309,212		(30.9)%
$	219,851		$	311,614		(29.4)%	Room revenues	$	474,315		$	578,660		(18.0)%
6,320			6,070			4.1%	Other hotel revenues	13,088			11,373			15.1%
$	226,171		$	317,684		(28.8)%	Total room and other hotel revenues	$	487,403		$	590,033		(17.4)%
41.7		%	54.4		%	(1270) bps	Hotel Operating Margin	43.8		%	52.4		%	(860) bps
(1) Included in hotel operating expenses in the consolidated statements of operations.

EXTENDED STAY AMERICA, INC.
NON-GAAP RECONCILIATION OF NET (LOSS) INCOME TO EBITDA AND ADJUSTED EBITDA
FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2020 AND 2019
(In thousands)
(Unaudited)
Three Months Ended					Six Months Ended
June 30,					June 30,
2020		2019			2020		2019
$	(8,770)	$	59,658	Net (loss) income	$	(925)	$	88,062
33,621		29,766		Interest expense, net	66,306		59,370
(6,052)		11,198		Income tax (benefit) expense	(4,942)		17,321
51,042		49,017		Depreciation and amortization	101,562		97,795
69,841		149,639		EBITDA	162,001		262,548
1,864		2,147		Equity-based compensation	2,990		4,255
675		—		Impairment of long-lived assets	675		—
638		—		System services loss, net(1)	1,055		—
1,335		1,857		Other expense(2)	5,381		3,151
$	74,353	$	153,643	Adjusted EBITDA	$	172,102	$	269,954
(1) In light of the growth of our franchise business and in order to enhance comparability, effective January 1, 2020, the Company adopted the practice of other lodging companies with franchise businesses of excluding system services (profit) loss, net from Adjusted EBITDA; no adjustments have been made to prior period results. System services loss, net for the three and six months ended June 30, 2019, was $0.5 million and $1.0 million, respectively.
(2) Includes loss on disposal of assets, non-operating (income) expense, including foreign currency transaction costs, and certain costs associated with dispositions. Loss on disposal of assets totaled $1.6 million, $2.0 million, $5.0 million and $3.4 million, respectively.

9

EXTENDED STAY AMERICA, INC.
NON-GAAP RECONCILIATION OF NET (LOSS) INCOME ATTRIBUTABLE TO EXTENDED STAY AMERICA, INC.
COMMON SHAREHOLDERS TO FUNDS FROM OPERATIONS, ADJUSTED FUNDS FROM OPERATIONS
AND ADJUSTED FUNDS FROM OPERATIONS PER DILUTED PAIRED SHARE
FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2020 AND 2019
(In thousands, except per share and per Paired Share data)
(Unaudited)
Three Months Ended					Six Months Ended
June 30,					June 30,
2020		2019			2020		2019
$	(0.07)	$	0.28	Net (loss) income per Extended Stay America, Inc. common share - diluted	$	(0.04)	$	0.40
$	(12,363)	$	53,497	Net (loss) income attributable to Extended Stay America, Inc. common shareholders	$	(7,809)	$	75,431
3,589		6,157		Noncontrolling interests attributable to Class B common shares of ESH REIT	6,876		12,623
49,429		47,655		Real estate depreciation and amortization	98,310		95,088
675		—		Impairment of long-lived assets	675		—
(10,822)		(7,482)		Tax effect of adjustments to net (loss) income attributable to Extended Stay America, Inc. common shareholders	(12,430)		(14,882)
30,508		99,827		Funds From Operations	85,622		168,260
$	30,508	$	99,827	Adjusted Funds From Operations	$	85,622	$	168,260
$	0.17	$	0.53	Adjusted Funds From Operations per Paired Share - diluted	$	0.48	$	0.89
177,844		188,813		Weighted average Paired Shares outstanding - diluted	178,008		188,695

10

EXTENDED STAY AMERICA, INC.
NON-GAAP RECONCILIATION OF NET (LOSS) INCOME ATTRIBUTABLE TO EXTENDED STAY AMERICA, INC.
COMMON SHAREHOLDERS TO PAIRED SHARE (LOSS) INCOME, ADJUSTED PAIRED SHARE (LOSS) INCOME
AND ADJUSTED PAIRED SHARE (LOSS) INCOME PER DILUTED PAIRED SHARE
FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2020 AND 2019
(In thousands, except per share and per Paired Share data)
(Unaudited)
Three Months Ended June,					Six Months Ended June,
2020		2019			2020		2019
$	(0.07)	$	0.28	Net (loss) income per Extended Stay America, Inc. common share - diluted	$	(0.04)	$	0.40
$	(12,363)	$	53,497	Net (loss) income attributable to Extended Stay America, Inc. common shareholders	$	(7,809)	$	75,431
3,589		6,157		Noncontrolling interests attributable to Class B common shares of ESH REIT	6,876		12,623
(8,774)		59,654		Paired Share (Loss) Income	(933)		88,054
675		—		Impairment of long-lived assets	675		—
638		—		System services loss, net(1)	1,055		—
1,335		1,857		Other expense(2)	5,381		3,151
(573)		(291)		Tax effect of adjustments to Paired Share (Loss) Income	(720)		(493)
$	(6,699)	$	61,220	Adjusted Paired Share (Loss) Income	$	5,458	$	90,712
$	(0.04)	$	0.32	Adjusted Paired Share (Loss) Income per Paired Share - diluted	$	0.03	$	0.48
177,551		188,813		Weighted average Paired Shares outstanding - diluted	178,008		188,695
(1) In light of the growth of our franchise business and in order to enhance comparability, effective January 1, 2020, the Company adopted the practice of other lodging companies with franchise businesses of excluding system services (profit) loss, net from Adjusted Paired Share (Loss) Income; no adjustments have been made to prior period results. System services loss, net for the three and six months ended June 30, 2019, was $0.5 million and $1.0 million, respectively.
(2) Includes loss on disposal of assets, non-operating (income) expense, including foreign currency transaction costs, and certain costs associated with dispositions. Loss on disposal of assets totaled $1.6 million, $2.0 million, $5.0 million and $3.4 million, respectively.

11

EXTENDED STAY AMERICA, INC.
NON-GAAP RECONCILIATION OF NET INCOME TO EBITDA AND ADJUSTED EBITDA
FOR THE THREE MONTHS ENDED SEPTEMBER 30, 2019 (ACTUAL) AND 2020 (OUTLOOK)
(In thousands)
(Unaudited)
Three Months Ended			Three Months Ended September 30, 2020
September 30, 2019			(Outlook)
(Actual)			Low		High
$	53,230	Net income	$	11,000	$	44,000
36,535		Interest expense, net	33,000		33,000
10,501		Income tax expense (benefit)(1)	(2,000)		(26,000)
49,748		Depreciation and amortization	52,000		50,000
150,014		EBITDA	94,000		101,000
1,876		Equity-based compensation	1,700		1,700
2,679		Impairment of long-lived assets	—		—
1,756		Other expense(2)	2,300		2,300
$	156,325	Adjusted EBITDA	$	98,000	$	105,000
(1) The Q3-2020 Outlook with respect to income tax applies to absolute income tax expense (benefit) only. Due to (1) certain provisions of the CARES Act related to income tax relief, (2) a greater variability in quarterly forecasted results within the current year than in prior years and (3) a wider than usual range between the forecasted financial results of ESA, a taxable C-Corp, and ESH REIT, a non-taxable real estate investment trust (in each case due to the volatility in our performance caused by the COVID-19 pandemic), the Q3-2020 Outlook with respect to income tax does not apply to, or provide an outlook with respect to, the Company's effective tax rate or range of effective tax rates for either the three months ended September 30, 2020, or the year ended December 31, 2020.
(2) Includes loss on disposal of assets, non-operating expense (income), including foreign currency transaction costs, and certain costs associated with dispositions.

12

EX-99.2

Q2 2020 Earnings Summary August 10, 2020 Extended Stay America, Inc. ESH Hospitality, Inc.

important disclosure information This presentation contains forward-looking statements within the meaning of the federal securities laws. These statements include, but are not limited to, statements related to our expectations regarding our business performance, business strategies, financial results, liquidity and capital resources, capital expenditures, capital returns, Q3 2020 Outlook and Full Year 2020 Outlook, distribution policy, plans, goals, beliefs, business trends and future events, as well as the COVID-19 pandemic, its effects on the foregoing, government action taken in response to the pandemic and action that we have or plan to take in response to the pandemic and other non-historical statements, including statements relating to industry RevPAR trends. Forward looking statements involve known and unknown risks, uncertainties and other factors that may cause Extended Stay America, Inc.’s (“ESA”) and ESH Hospitality, Inc.’s (“ESH REIT,” and together with ESA, the “Company”) actual results or performance to differ from those projected in the forward-looking statements, possibly materially. For a description of factors that may cause the Company’s actual results or performance to differ from projected results or performance implied by forward-looking statements, please review the information under the headings “Cautionary Note Regarding Forward-Looking Statements” and “Risk Factors” included in the Company’s combined annual report on Form 10-K filed with the Securities and Exchange Commission (“SEC”) on February 26, 2020 and other documents of the Company on file with or furnished to the SEC, including our combined quarterly report on Form 10-Q filed with the SEC on August 10, 2020. Any forward-looking statements made in this presentation are qualified by these cautionary statements, and there can be no assurance that the actual results or developments anticipated by the Company will be realized or, even if substantially realized, will have the expected consequences to, or effects on, the Company, its business or operations. Except as required by law, the Company undertakes no obligation to update or revise any forward-looking statement, whether as a result of new information, future developments or otherwise. We caution you that actual results may differ materially and adversely from what is expressed, implied or forecasted by the Company’s forward-looking statements. This presentation includes certain non-GAAP financial measures, including Hotel Operating Profit, Hotel Operating Margin, EBITDA, Adjusted EBITDA, Funds from Operations (“FFO”), Adjusted Funds From Operations (“Adjusted FFO”), Adjusted FFO per diluted Paired Share, Paired Share Income, Adjusted Paired Share Income and Adjusted Paired Share Income per diluted Paired Share. These non-GAAP financial measures should be considered only as supplemental to, and not as superior to, financial measures prepared in accordance with U.S. GAAP. Please refer to the Appendix of this presentation for a reconciliation of these non-GAAP financial measures to the most directly comparable financial measures prepared in accordance with U.S. GAAP, and to the Company’s combined annual report on Form 10-K filed with the SEC on February 26, 2020 for definitions of these non-GAAP measures. This presentation includes certain operating metrics presented on a comparable system-wide basis. The term “comparable system-wide” refers to hotels operated under the Extended Stay America brand, including those owned, franchised or managed by the Company, for both the full three and six months ended June 30, 2020 and 2019. For franchised or managed hotels, ESA earns certain fees based on a percentage of hotel revenues. 2

Q2 2020 Operating Results and Financial Highlights comparable system-wide revenue per available net income (loss) (in millions) room (“RevPAR”) $53.84 $59.7 $38.38 ($8.8) Q2 2019 Q2 2020 Q2 2019 Q2 2020 hotel operating margin1 adjusted FFO per diluted Paired Share1 54.4% $0.53 41.7% $0.17 Q2 2019 Q2 2020 Q2 2019 Q2 2020 adjusted EBITDA (in millions)1 adjusted Paired Share income (loss) per diluted Paired Share1 $153.6 $0.32 $74.4 Q2 2019 Q2 2020 ($0.04) Q2 2019 Q2 2020 1See Appendix for Hotel Operating Margin, Adjusted FFO per diluted Paired Share, Adjusted EBITDA and Adjusted Paired Share Income per diluted Paired Share reconciliations. 3

Significantly outperforming industry, segment and competitive set 1,2 3 • STAY’s 2020 RevPAR and occupancy compared to 2019 has held up significantly better than the industry and other mid-priced extended stay hotels since the pandemic began in the United States in March 20201,2 • STAY’s RevPAR Index3, already improving before COVID-19, has continued at very high levels months into the crisis 1 Total industry RevPAR numbers per STR, Inc. (“STR”), a CoStar Group Company, as reported at Hotel News Now. Mid-priced extended stay RevPAR per The Highland Group, Inc. (“Highland”) for average of reported April, May and June 2020. Neither STR nor Highland endorse the Company, nor any other operator of hotels, and the data provided by each such company should not be viewed as investment advice or as a recommendation to take a particular course of action. 2 Industry RevPAR numbers do not reflect hotel closures; industry revenue decline is steeper than RevPAR. 4 3 See Appendix for RevPAR Index definition and disclosure.

Well positioned in a challenging environment ✓ System-wide occupancy running higher than FY 2019 levels in recent weeks ✓ Majority of STAY’s guests are driving to hotels; ~75% of locations are suburban ✓ STAY’s guests average length of stay is ~30 nights vs ~2 nights for overall industry ✓ Current RevPAR levels generate positive cash flow, even with capital investments ✓ Full kitchen and refrigerator in room attract guests worried about COVID-19 exposure while traveling or with limited dining out options ✓ Very limited urban, group and in-bound international exposure; no hotels were closed during pandemic ✓ RevPAR has increased each week since mid-April 5

Balance Sheet Update as of June 30, 2020 cash balance (in millions)1 $682 Q2 2020 maturity amount/ interest debt capitalization date millions2 rate Term Loan B 2026 $626 L + 2003 ESH REIT revolver 2024 $350 L + 200 ($350m) ESA revolver ($50m) 2024 $50 L + 225 total secured debt $1,026 senior unsecured notes 2025 $1,300 5.25% senior unsecured notes 2027 $750 4.625% preferred stock4 2020 $1 8.00% total unsecured debt $2,051 total company debt $3,077 • STAY repaid the $350 million ESH REIT Revolver in full since the end of Q2 with available cash on hand • Strong cash position and no significant debt maturities until May 2025 1 Includes restricted and unrestricted cash; does not include the repayment of ESH Revolver of $350 million. 2 Gross debt outstanding (excludes discounts and deferred financing costs). 3 $150m swapped to fixed LIBOR of 1.175% as of 6/30/20. 6 4 Mandatorily redeemable in November 2020.

Pipeline Update Company Owned Pipeline & Recently Opened Hotels as of June 30, 2020 Under Option Pre-Development Under Construction Total Pipeline Opened YTD # Hotels # Rooms # Hotels # Rooms # Hotels # Rooms # Hotels # Rooms # Hotels # Rooms 0 0 4 504 7 888 11 1,392 4 488 Third Party Pipeline & Recently Opened Hotels as of June 30, 2020 Commitments Applications Executed Total Pipeline Opened YTD # Hotels # Rooms # Hotels # Rooms # Hotels # Rooms # Hotels # Rooms # Hotels # Rooms 27 3,348 4 464 27 3,184 58 6,996 2 205 • 3 ESA owned and 1 franchise owned hotel opened in 2Q 2020 Definitions Under Option Locations with a signed purchase and sale agreement Pre-Development Land purchased, permitting and/or site work Under Construction Hotel is under construction Commitments Signed commitment to build or convert a certain number of hotels by a third party, generally associated with a prior portfolio sale Applications Third party filed franchise application with deposit Executed Franchise and development application approved, geography identified and deposits paid, various stages of pre-development and/or under construction 7

Outlook Update1 Q3 2020 Comparable system-wide RevPAR % D: -21% to -18% Company owned RevPAR % D: -22% to -19% Adjusted EBITDA: $98 million to $105 million FY 2020 Capital expenditures: $160 to $190 million Depreciation expense: $198 to $203 million Net interest expense: $133 million 1Outlook for Q3 2020 and Full Year 2020 is as of August 10, 2020. Performance for the third quarter is subject to risks and uncertainties, in particular the ongoing impact of the COVID-19 pandemic, which could cause actual results to deviate materially and adversely from current trends and expectations. In such event, the Company does not expect to and undertakes no obligation to announce changes in 8 expectations prior to the announcement of actual third quarter results.

appendix

REVPAR INDEX RevPAR Index is stated as a percentage and calculated by comparing RevPAR for comparable system-wide hotels to the aggregate RevPAR of a group of competing hotels generally in the same geographic market. As such, the RevPAR Index is only a measure of RevPAR relative to certain competing hotels and not a measure of our absolute RevPAR or profitability. We subscribe to STR, Inc. ("STR"), an independent third-party service, which collects and compiles the data used to calculate RevPAR Index. We select the competing hotels included in the RevPAR Index calculation subject to STR's guidelines. The competing hotels included in STR guidelines will generally include certain hotels that are not considered part of the extended stay lodging segment of the hospitality industry and, instead, fall within the category of short-term stay hotels. STR does not endorse the Company, or any other company or operator of hotels, and STR data should not be viewed as investment advice or as a recommendation to take a particular course of action. 10

NON-GAAP RECONCILIATION OF NET (LOSS) INCOME TO HOTEL OPERATING PROFIT AND HOTEL OPERATING MARGIN FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2020 AND 2019 (In thousands) (Unaudited) Three Months Ended Six Months Ended June 30, June 30, 2020 2019 Variance 2020 2019 Variance $ (8,770) $ 59,658 (114.7)% Net (loss) income $ (925) $ 88,062 (101.1)% (6,052) 11,198 (154.0)% Income tax (benefit) expense (4,942) 17,321 (128.5)% 33,621 29,766 13.0% Interest expense, net 66,306 59,370 11.7% (302) (171) 76.6% Other non-operating (income) expense 401 (349) (214.9)% (1) (1) – Other income (3) (28) (89.3)% 675 - n/a Impairment of long-lived assets 675 - n/a 51,042 49,017 4.1% Depreciation and amortization 101,562 97,795 3.9% 23,103 22,287 3.7% General and administrative expenses 47,041 45,314 3.8% 1,636 2,001 (18.2)% Loss on disposal of assets (1) 4,979 3,377 47.4% (1,218) (1,447) (15.8)% Franchise and management fees (2,497) (2,672) (6.5)% 638 470 35.7% System services loss, net 1,055 1,022 3.2% $ 94,372 $ 172,778 (45.4)% Hotel Operating Profit $ 213,652 $ 309,212 (30.9)% $ 219,851 $ 311,614 (29.4)% Room revenues $ 474,315 $ 578,660 (18.0)% 6,320 6,070 4.1% Other hotel revenues 13,088 11,373 15.1% $ 226,171 $ 317,684 (28.8)% Total room and other hotel revenues $ 487,403 $ 590,033 (17.4)% 41.7% 54.4% (1270) bps Hotel Operating Margin 43.8% 52.4% (860) bps (1) Included in hotel operating expenses in the consolidated statements of operations. 11

NON-GAAP RECONCILIATION OF NET (LOSS) INCOME TO EBITDA AND ADJUSTED EBITDA FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2020 AND 2019 (In thousands) (Unaudited) Three Months Ended Six Months Ended June 30, June 30, 2020 2019 2020 2019 $ (8,770) $ 59,658 Net (loss) income $ (925) $ 88,062 33,621 29,766 Interest expense, net 66,306 59,370 (6,052) 11,198 Income tax (benefit) expense (4,942) 17,321 51,042 49,017 Depreciation and amortization 101,562 97,795 69,841 149,639 EBITDA 162,001 262,548 1,864 2,147 Equity-based compensation 2,990 4,255 675 - Impairment of long-lived assets 675 - 638 - System services loss, net(1) 1,055 - 1,335 1,857 Other expense(2) 5,381 3,151 $ 74,353 $ 153,643 Adjusted EBITDA $ 172,102 $ 269,954 (1) In light of the growth of our franchise business and in order to enhance comparability, effective January 1, 2020, the Company adopted the practice of other lodging companies with franchise businesses of excluding system services (profit) loss, net from Adjusted EBITDA; no adjustments have been made to prior period results. System services loss, net for the three and six months ended June 30, 2019, was $0.5 million and $1.0 million, respectively. (2) Includes loss on disposal of assets, non-operating (income) expense, including foreign currency transaction costs, and certain costs associated with dispositions. Loss on disposal of assets totaled $1.6 million, $2.0 million, $5.0 million and $3.4 million, respectively. 12

NON-GAAP RECONCILIATION OF NET (LOSS) INCOME ATTRIBUTABLE TO EXTENDED STAY AMERICA, INC. COMMON SHAREHOLDERS TO FUNDS FROM OPERATIONS, ADJUSTED FUNDS FROM OPERATIONS AND ADJUSTED FUNDS FROM OPERATIONS PER DILUTED PAIRED SHARE FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2020 AND 2019 (In thousands, except per share and per Paired Share data) (Unaudited) Three Months Ended Six Months Ended June 30, June 30, 2020 2019 2020 2019 Net (loss) income per Extended Stay America, Inc. common $ (0.07) $ 0.28 $ (0.04) $ 0.40 share - diluted Net (loss) income attributable to Extended Stay America, Inc. $ (12,363) $ 53,497 $ (7,809) $ 75,431 common shareholders Noncontrolling interests attributable to Class B 3,589 6,157 6,876 12,623 common shares of ESH REIT 49,429 47,655 Real estate depreciation and amortization 98,310 95,088 675 - Impairment of long-lived assets 675 - Tax effect of adjustments to net (loss) income attributable to (10,822) (7,482) (12,430) (14,882) Extended Stay America, Inc. common shareholders 30,508 99,827 Funds from Operations 85,622 168,260 $ 30,508 $ 99,827 Adjusted Funds from Operations $ 85,622 $ 168,260 Adjusted Funds from Operations $ 0.17 $ 0.53 per Paired Share – diluted $ 0.48 $ 0.89 Weighted average Paired Shares 177,844 188,813 outstanding – diluted 178,008 188,695 13

NON-GAAP RECONCILIATION OF NET (LOSS) INCOME ATTRIBUTABLE TO EXTENDED STAY AMERICA, INC. COMMON SHAREHOLDERS TO PAIRED SHARE (LOSS) INCOME, ADJUSTED PAIRED SHARE (LOSS) INCOME AND ADJUSTED PAIRED SHARE (LOSS) INCOME PER DILUTED PAIRED SHARE FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2020 AND 2019 (In thousands, except per share and per Paired Share data) (Unaudited) Three Months Ended Six Months Ended June 30, June 30, 2020 2019 2020 2019 Net (loss) income per Extended Stay America, Inc. common $ (0.07) $ 0.28 $ (0.04) $ 0.40 share - diluted Net (loss) income attributable to Extended Stay America, Inc. $ (12,363) $ 53,497 common shareholders $ (7,809) $ 75,431 Noncontrolling interests attributable to Class B 3,589 6,157 common shares of ESH REIT 6,876 12,623 (8,774) 59,654 Paired Share (Loss) Income (933) 88,054 675 - Impairment of long-lived assets 675 - 638 - System services loss, net(1) 1,055 - 1,335 1,857 Other expense(2) 5,381 3,151 (573) (291) Tax effect of adjustments to Paired Share (Loss) Income (720) (493) $ (6,699) $ 61,220 Adjusted Paired Share (Loss) Income $ 5,458 $ 90,712 Adjusted Paired Share (Loss) Income per $ (0.04) $ 0.32 Paired Share – diluted $ 0.03 $ 0.48 177,551 188,813 Weighted average Paired Shares outstanding – diluted 178,008 188,695 (1) In light of the growth of our franchise business and in order to enhance comparability, effective January 1, 2020, the Company adopted the practice of other lodging companies with franchise businesses of excluding system services (profit) loss, net from Adjusted Paired Share (Loss) Income; no adjustments have been made to prior period results. System services loss, net for the three and six months ended June 30, 2019, was $0.5 million and $1.0 million, respectively. (2) Includes loss on disposal of assets, non-operating (income) expense, including foreign currency transaction costs, and certain costs associated with dispositions. Loss on disposal of assets totaled $1.6 million, $2.0 million, $5.0 million and $3.4 million, respectively. 14

NON-GAAP RECONCILIATION OF NET INCOME TO EBITDA AND ADJUSTED EBITDA FOR THE THREE MONTHS ENDED SEPTEMBER 30, 2019 (ACTUAL) AND 2020 (OUTLOOK) (In thousands) (Unaudited) Three Months Ended Three Months Ended September 30, 2020 September 30, 2019 (Outlook) (Actual) Low High $ 53,230 Net income $ 11,000 $ 44,000 36,535 Interest expense, net 33,000 33,000 10,501 Income tax expense (benefit)(1) (2,000) (26,000) 49,748 Depreciation and amortization 52,000 50,000 150,014 EBITDA 94,000 101,000 1,876 Equity-based compensation 1,700 1,700 2,679 Impairment of long-lived assets - - 1,756 Other expense(2) 2,300 2,300 $ 156,325 Adjusted EBITDA $ 98,000 $ 105,000 (1) The Q3-2020 Outlook with respect to income tax applies to absolute income tax expense (benefit) only. Due to (1) certain provisions of the CARES Act related to income tax relief, (2) a greater variability in quarterly forecasted results within the current year than in prior years and (3) a wider than usual range between the forecasted financial results of ESA, a taxable C-Corp, and ESH REIT, a non-taxable real estate investment trust (in each case due to the volatility in our performance caused by the COVID-19 pandemic), the Q3-2020 Outlook with respect to income tax does not apply to, or provide an outlook with respect to, the Company's effective tax rate or range of effective tax rates for either the three months ended September 30, 2020, or the year ended December 31, 2020. (2) Includes loss on disposal of assets, non-operating expense (income), including foreign currency transaction costs, and certain costs associated with dispositions. 15

XML

Cover	Aug. 10, 2020
Document Information [Line Items]
Document Type	8-K
Document Period End Date	Aug. 10, 2020
Entity Registrant Name	EXTENDED STAY AMERICA, INC.
Entity Incorporation, State or Country Code	DE
Entity File Number	001-36190
Entity Tax Identification Number	46-3140312
Entity Address, Address Line One	11525 N. Community House Road, Suite 100
Entity Address, City or Town	Charlotte
Entity Address, State or Province	NC
Entity Address, Postal Zip Code	28277
City Area Code	980
Local Phone Number	345-1600
Title of 12(b) Security	Common Stock, par value $0.01 per share
Trading Symbol	STAY
Security Exchange Name	NASDAQ
Written Communications	false
Soliciting Material	false
Pre-commencement Tender Offer	false
Pre-commencement Issuer Tender Offer	false
Entity Emerging Growth Company	false
Entity Central Index Key	0001581164
Amendment Flag	false
ESH Hospitality, Inc.
Document Information [Line Items]
Entity Registrant Name	ESH HOSPITALITY, INC.
Entity Incorporation, State or Country Code	DE
Entity File Number	001-36191
Entity Tax Identification Number	27-3559821
Entity Address, Address Line One	11525 N. Community House Road, Suite 100
Entity Address, City or Town	Charlotte
Entity Address, State or Province	NC
Entity Address, Postal Zip Code	28277
City Area Code	980
Local Phone Number	345-1600
Entity Central Index Key	0001507563