Apple Hospitality REIT Q2 2024 10-Q Filed

TL;DR

**APLE Q2 10-Q is IN!** Key financials and hotel performance details released.

AI Summary

Apple Hospitality REIT, Inc. filed its 10-Q for the period ending June 30, 2024. The filing details financial performance and operational updates for the company, which owns and operates hotels and hospitality properties. Key financial figures and operational metrics are presented for the second quarter of 2024.

Why It Matters

This filing provides investors with crucial financial and operational data for Apple Hospitality REIT, enabling them to assess the company's performance and make informed investment decisions.

Risk Assessment

Risk Level: medium — REITs are sensitive to interest rate changes and economic downturns, which can impact property values and rental income.

Key Numbers

• 2024-06-30 — Reporting Period End (The company's financial status as of this date is detailed.)
• 2024-01-01 — Q2 2024 Start Date (Beginning of the second quarter for which financial results are reported.)
• 2023-12-31 — Year-End 2023 (Comparative financial data from the previous fiscal year-end.)
• 2023-06-30 — Q2 2023 End Date (End of the second quarter of the prior year for comparative analysis.)

Key Players & Entities

• Apple Hospitality REIT, Inc. (company) — Filer
• 2024-06-30 (date) — Reporting Period End Date
• 804.344.8121 (phone_number) — Business Phone Number
• Apple REIT Nine, Inc. (company) — Former Company Name
• 2007-11-09 (date) — Date of Name Change

FAQ

Filing Documents

• aple-20240630.htm (10-Q) — 3222KB
• aple-ex31_1.htm (EX-31.1) — 12KB
• aple-ex31_2.htm (EX-31.2) — 11KB
• aple-ex31_3.htm (EX-31.3) — 11KB
• aple-ex32_1.htm (EX-32.1) — 9KB
• 0000950170-24-090771.txt ( ) — 10887KB
• aple-20240630.xsd (EX-101.SCH) — 1498KB
• aple-20240630_htm.xml (XML) — 1833KB

FINANCIAL INFORMATION

PART I. FINANCIAL INFORMATION Item 1.

Financial Statements

Financial Statements 3 Consolidated Balance Sheets – June 30, 2024 and December 31, 2023 3 Consolidated Statements of Operations and Comprehensive Income – three and six months ended June 30, 2024 and 2023 4 Consolidated Statements of Shareholders' Equity – three and six months ended June 30, 2024 and 2023 5 Consolidated Statements of Cash Flows – six months ended June 30, 2024 and 2023 6

Notes to Consolidated Financial Statements

Notes to Consolidated Financial Statements 7 Item 2.

Management's Discussion and Analysis of Financial Condition and Results of Operations

Management's Discussion and Analysis of Financial Condition and Results of Operations 19 Item 3.

Quantitative and Qualitative Disclosures About Market Risk

Quantitative and Qualitative Disclosures About Market Risk 37 Item 4.

Controls and Procedures

Controls and Procedures 37

OTHER INFORMATION

PART II. OTHER INFORMATION Item 1.

Legal Proceedings

Legal Proceedings 38 Item 2. Unregistered Sales of Equity Securities and Use of Proceeds 38 Item 5. Other Information 38 Item 6. Exhibits 39

Signatures

Signatures 40 This Form 10-Q includes references to certain trademarks or service marks. The AC Hotels by Marriott, Aloft Hotels, Courtyard by Marriott, Fairfield by Marriott, Marriott Hotels, Residence Inn by Marriott, SpringHill Suites by Marriott and TownePlace Suites by Marriott trademarks are the property of Marriott International, Inc. or one of its affiliates. The Embassy Suites by Hilton, Hampton by Hilton, Hilton Garden Inn, Home2 Suites by Hilton, Homewood Suites by Hilton and Motto by Hilton trademarks are the property of Hilton Worldwide Holdings Inc. or one of its affiliates. The Hyatt, Hyatt House and Hyatt Place trademarks are the property of Hyatt Hotels Corporation or one of its affiliates. For convenience, the applicable trademark or service mark symbol has been omitted but will be deemed to be included wherever the above referenced terms are used.

FINANCIAL INFORMATION

PART I. FINANCIAL INFORMATION

Financi al Statements

Item 1. Financi al Statements Apple Hospitality REIT, Inc. Consolidated B alance Sheets (in thousands, except share data) June 30, December 31, 2024 2023 (unaudited) Assets Investment in real estate, net of accumulated depreciation and amortization of $ 1,753,584 and $ 1,662,942 , respectively $ 4,911,878 $ 4,777,374 Assets held for sale - 15,283 Cash and cash equivalents 7,224 10,287 Restricted cash-furniture, fixtures and other escrows 31,295 33,331 Due from third-party managers, net 62,894 36,437 Other assets, net 62,109 64,586 Total Assets $ 5,075,400 $ 4,937,298 Liabilities Debt, net $ 1,536,891 $ 1,371,494 Finance lease liabilities 111,776 111,892 Accounts payable and other liabilities 93,763 129,931 Total Liabilities 1,742,430 1,613,317 Shareholders' Equity Preferred stock, authorized 30,000,000 shares; none issued and outstanding - - Common stock, no par value, authorized 800,000,000 shares; issued and outstanding 241,280,329 and 241,515,532 shares, respectively 4,790,949 4,794,804 Accumulated other comprehensive income 21,380 20,404 Distributions greater than net income ( 1,479,359 ) ( 1,491,227 ) Total Shareholders' Equity 3,332,970 3,323,981 Total Liabilities and Shareholders' Equity $ 5,075,400 $ 4,937,298 See notes to consolidated financial statements. 3 Apple Hospitality REIT, Inc. Consolidated Statements of Operatio ns and Comprehensive Income (Unaudited) (in thousands, except per share data) Three Months Ended Six Months Ended June 30, June 30, 2024 2023 2024 2023 Revenues: Room $ 353,689 $ 331,043 $ 652,435 $ 616,563 Food and beverage 17,857 15,507 32,919 28,456 Other 18,531 15,080 34,235 28,065 Total revenue 390,077 361,630 719,589 673,084 Expenses: Hotel operating expense: Operating 91,523 84,911 175,319 163,574 H

Notes to Consolidated Financial Statements

Notes to Consolidated Financial Statements (Unaudited) 1. Organization and Summary of Significant Accounting Policies Organization Apple Hospitality REIT, Inc., formed in November 2007 as a Virginia corporation, together with its wholly-owned subsidiaries (the "Company"), is a self-advised real estate investment trust ("REIT") that invests in income-producing real estate, primarily in the lodging sector, in the United States ("U.S."). The Company's fiscal year end is December 31. The Company has no foreign operations or assets, and its operating structure includes only one reportable segment. The consolidated financial statements include the accounts of the Company and its subsidiaries. All intercompany accounts and transactions have been eliminated. Although the Company has interests in potential variable interest entities through its purchase commitments, it is not the primary beneficiary as the Company does not have any elements of power in the decision-making process of these entities; therefore, the Company does not consolidate the entities. As of June 30, 2024, the Company owned 224 hotels with an aggregate of 30,068 guest rooms located in 37 states and the District of Columbia ("D.C."). The Company's common shares are listed on the New York Stock Exchange ("NYSE") under the ticker symbol "APLE." Basis of Presentation The accompanying unaudited consolidated financial statements have been prepared in accordance with the rules and regulations for reporting on Form 10-Q. Accordingly, they do not include all of the information required by U.S. generally accepted accounting principles ("GAAP") for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. These unaudited financial statements should be read in conjunction with the Company's audited consolidated financial statements included in its Annual Report on Form 10-K for the

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