Pebblebrook Hotel Trust (PEB) swung to a net loss for the quarter ended Sep. 30, 2016. The company has made a net loss of $35.42 million, or $ 0.61 a share in the quarter, against a net profit of $38.12 million, or $0.43 a share in the last year period.

Revenue during the quarter dropped 3.40 percent to $208.96 million from $216.32 million in the previous year period.

Cost of revenue dropped 4.93 percent or $6.70 million during the quarter to $129.29 million. Gross margin for the quarter expanded 99 basis points over the previous year period to 38.13 percent.

Total expenses were $173.62 million for the quarter, up 3 percent or $5.06 million from year-ago period. Operating margin for the quarter contracted 517 basis points over the previous year period to 16.91 percent.

Operating income for the quarter was $35.34 million, compared with $47.76 million in the previous year period. However, the adjusted EBITDA for the quarter stood at $80.38 million compared with $82.36 million in the prior year period. At the same time, adjusted EBITDA margin improved 39 basis points in the quarter to 38.47 percent from 38.07 percent in the last year period.

Pebblebrook Hotel Trust expects net income to be in the range of $6 million to $9 million for the fourth-quarter. 

For fiscal year 2016, Pebblebrook Hotel Trust expects net income to be in the range of $61 million to $65 million.

Occupancy revenue was $152.69 million for the quarter, down 0.93 percent or $1.43 million. Food and beverage revenue was $42.56 million during the quarter, down 10.24 percent or $4.86 million from year-ago period. Revenue from other hotel operating activities was $13.71 million for the quarter, down 7.27 percent or $1.07 million from year-ago period.

"We were pleased with our operating results during the third quarter, despite headwinds from continued weakness in business travel demand," said Jon E. Bortz, chairman, president and chief executive officer of Pebblebrook Hotel Trust. "The west coast again led our performance in the third quarter. We experienced strong demand in Los Angeles and benefitted from healthy convention calendars in San Diego and Philadelphia, which was also the host city for the Democratic National Convention in July. Top line performance was in the middle of our expected range, while we had great success driving better profitability to our bottom line."

Net receivables were at $31.58 million as on Sep. 30, 2016, down 16.31 percent or $6.15 million from year-ago.

Total assets declined 4.38 percent or $135.53 million to $2,955.43 million on Sep. 30, 2016. On the other hand, total liabilities were at $1,350.89 million as on Sep. 30, 2016, up 1.40 percent or $18.62 million from year-ago.

Return on assets was negative at 0.86 percent in the quarter against a positive 1.60 percent in the last year period. Return on equity was negative at 2.74 percent in the quarter against a positive 1.80 percent in the last year period.