Chatham Lodging Trust Segments Disclosure
| 15. | Segment Information |
Management evaluates the Company's hotels as a reportable segment as a result of aggregating multiple operating segments, because all of the Company's hotels have similar economic characteristics and provide similar services to similar types of customers. Our single reportable segment comprises the structure used by our Chief Executive Officer, Chief Operating Officer, and Chief Financial Officer, who collectively have been determined to be our Chief Operating Decision Maker ("CODM"), to make key operating decisions and assess performance. Our CODM evaluates our single reportable segment's operating performance based on individual hotel property net income (loss) before interest expense, income tax expense, depreciation and amortization, corporate general and administrative expense, impairment loss, loss on early extinguishment of debt, other charges, interest and other income, and gains or losses on sales of hotel properties ("Adjusted Hotel EBITDA"). Our single reportable segment's assets are consistent with total assets included in the Company's consolidated balance sheets.
The following table includes revenue, significant hotel operating expenses, and Adjusted Hotel EBITDA for the Company’s hotels, reconciled to Net income (in thousands):
| For the year ended | ||||||||||||
| December 31, | ||||||||||||
| 2025 | 2024 | 2023 | ||||||||||
| Revenue: | ||||||||||||
| Room | $ | 269,206 | $ | 290,290 | $ | 284,999 | ||||||
| Food and beverage | 6,894 | 7,737 | 8,124 | |||||||||
| Other | 17,897 | 18,077 | 16,703 | |||||||||
| Total hotel property level revenue (1) | 293,997 | 316,104 | 309,826 | |||||||||
| Expenses: | ||||||||||||
| Room | 59,752 | 65,311 | 61,794 | |||||||||
| Food and beverage | 5,517 | 6,218 | 6,352 | |||||||||
| Telephone | 1,172 | 1,360 | 1,439 | |||||||||
| Other hotel operating | 4,487 | 4,127 | 3,712 | |||||||||
| General and administrative | 27,010 | 28,826 | 28,884 | |||||||||
| Franchise and marketing fees | 23,620 | 25,355 | 24,897 | |||||||||
| Advertising and promotions | 6,804 | 6,229 | 6,085 | |||||||||
| Utilities | 12,372 | 13,161 | 13,007 | |||||||||
| Repairs and maintenance | 15,272 | 16,516 | 15,837 | |||||||||
| Management fees paid to related parties | 9,895 | 10,733 | 10,557 | |||||||||
| Insurance | 3,272 | 3,340 | 2,822 | |||||||||
| Property taxes, ground rent and insurance | 21,952 | 23,709 | 23,507 | |||||||||
| Total hotel property level expenses | 191,125 | 204,885 | 198,893 | |||||||||
| Adjusted Hotel EBITDA | $ | 102,872 | $ | 111,219 | $ | 110,933 | ||||||
| Reconciliation of Adjusted Hotel EBITDA to Net income | ||||||||||||
| Interest expense, including amortization of deferred fees | (25,659 | ) | (30,880 | ) | (27,128 | ) | ||||||
| Depreciation and amortization | (59,749 | ) | (60,741 | ) | (58,254 | ) | ||||||
| Corporate general and administrative | (16,589 | ) | (18,388 | ) | (17,517 | ) | ||||||
| Other charges | (27 | ) | (327 | ) | (2,300 | ) | ||||||
| Impairment loss | — | (4,256 | ) | (4,266 | ) | |||||||
| Loss on early extinguishment of debt | (174 | ) | (17 | ) | (696 | ) | ||||||
| Interest and other income | 270 | 1,712 | 1,534 | |||||||||
| Gain on sale of hotel properties | 14,369 | 5,713 | 18 | |||||||||
| Gain from partial lease termination | — | — | 164 | |||||||||
| Net income | $ | 15,313 | $ | 4,035 | $ | 2,488 | ||||||
(1) The difference between total hotel property level revenue and total revenue on the consolidated statements of operations is due to reimbursable costs from related parties of $1.1 million, $1.1 million, and $1.3 million for the years ended December 31, 2025, 2024 and 2023, respectively.
About Segments Disclosures
Segment disclosures break a company into its reportable operating units, revealing revenue, profit, and asset allocation that consolidated financial statements obscure. Under ASC 280, segments must match how the chief operating decision maker views the business, providing a window into internal management structure and resource allocation priorities.
Key signals: compare segment margins to identify which units drive profitability and which destroy value. Watch for changes in the number of reportable segments — segment aggregation or disaggregation often coincides with strategic shifts or attempts to obscure declining performance. Intersegment elimination patterns reveal internal pricing practices. The reconciliation between segment totals and consolidated figures exposes corporate overhead allocation and unallocated items. Geographic revenue concentration highlights regulatory and currency exposure. Compare segment-level capital expenditure against segment revenue to assess where management is investing for future growth versus harvesting existing assets.