LuxUrban Hotels Inc (LUXH) Q2 2024 Earnings Call Transcript Highlights: Revenue Decline and ...

GuruFocus Research
5 min read

In This Article:

  • Net Rental Revenue: $18.2 million for Q2 2024, down 43% from $31.9 million in Q2 2023.

  • Average Units Available to Rent: 1,056 in Q2 2024, down from 1,625 in Q2 2023.

  • TRevPAR (Total Revenue per Available Room): $188 in Q2 2024, down from $257 in Q2 2023.

  • Cost of Revenue: $40.4 million in Q2 2024, up 86% from $21.7 million in Q2 2023.

  • Gross Profit: -$22.2 million in Q2 2024, down from $10.2 million in Q2 2023.

  • Total Operating Expenses: Decreased by approximately $1.2 million in Q2 2024 compared to Q2 2023.

  • Total Other Expense: $185,000 in Q2 2024, down from $29.7 million in Q2 2023.

  • Cash and Cash Equivalents: $61 as of June 30, 2024, down from $752,848 as of December 31, 2023.

  • Total Current Assets: $3,315,844 as of June 30, 2024, down from $19,721,057 as of December 31, 2023.

  • Working Capital Deficit: $62.6 million as of June 30, 2024, up from $13.4 million as of December 31, 2023.

  • Average Room Rate (Q2 2024): $220.96, projected to increase to $252.11 in Q2 2025.

Release Date: September 25, 2024

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

  • LuxUrban Hotels Inc (NASDAQ:LUXH) has launched the Lux 2.0 initiative, which includes the addition of experienced professionals from the hotel and finance sectors to the management team and Board of Directors.

  • The company has strategically reduced its domestic operations, focusing solely on properties with the potential to generate positive cash flow.

  • LuxUrban Hotels Inc (NASDAQ:LUXH) has successfully reduced operating overhead and is starting to see the intended benefits of the Lux 2.0 initiative.

  • The company has made significant reductions in labor costs and improved vendor relationships, contributing to a leaner and more efficient operation.

  • LuxUrban Hotels Inc (NASDAQ:LUXH) is optimistic about future growth, with projections of significant increases in average daily room rates (ADR) and revenue per available room (RevPAR) in 2025.

Negative Points

  • Net rental revenue for the three months ended June 30, 2024, decreased by 43% compared to the same period in 2023.

  • The company experienced a significant increase in the cost of revenue, primarily due to expensing unamortized lease acquisition costs and security deposits surrendered for exited properties.

  • Gross profit decreased by 318% for the three months ended June 30, 2024, compared to the same period in 2023.

  • LuxUrban Hotels Inc (NASDAQ:LUXH) has a working capital deficit of $62.6 million as of June 30, 2024, compared to a deficit of $13.4 million at December 31, 2023.

  • The company is facing challenges related to Nasdaq compliance and may need to undertake a reverse stock split to meet listing requirements.

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