Summit Hotel Properties, Inc. · NYSE:INN
Summit Hotel Properties — Investor Presentation (March 2017)
24 slides from Summit Hotel Properties's investor presentation, Mar 6, 2017
Slide 1: Investor Presentation March 2017
Investor Presentation March 2017 • NYSE: INN
Slide 2: Forward-Looking Statements
FORWARD - LOOKING STATEMENTS We make forward - looking statements in this presentation that are subject to risks and uncertainties . These forward - looking statements include information about possible or assumed future results of our business, financial condition, liquidity, results of operations,
Slide 3: Company Overview
Summit Hotel Properties, Inc. is a publicly - traded real estate investment trust focused on owning premium - branded hotels with efficient operating models primarily in the Upscale segment of the lodging industry. Our Company 81 hotels 10,964 premium guestrooms 23 states 87% of our portfolio is pos
Slide 4: Differentiated Investment Strategy
DIFFERENTIATED INVESTMENT STRATEGY 3 INDUSTRY LEADING BRAND PARTNERS FOCUSED AND EFFICIENT OPERATING MODEL UNCONFLICTED AND BEST - IN - CLASS OPERATORS BROAD GEOGRAPHIC EBITDA DIVERSIFICATION TARGETED CAPITAL RECYCLING AND REINVESTMENT
Slide 5: Executive Management Team
Executive Lodging Experience Operations Experience REIT Experience Background Daniel P. Hansen Chairman, President & Chief Executive Officer 13 years 11 years 6 years Prior to joining Summit, Mr . Hansen spent 11 years with Merrill Lynch in various leadership positions . Mr . Hansen was previously t
Slide 6: Value of Brand Partners
VALUE OF BRAND PARTNERS Premium Standards Exceptional service, ample amenities, and attractive design demonstrate award - winning quality. Global Brands With more than two million rooms globally, our partners enable us to serve both domestic and international travel. Reservation Systems Global booki
Slide 7: Upscale Outperformance
$71 $102 $55 $80 $105 2000 2016 + 43 % STR Upscale RevPAR (1) STR Upper - Upscale RevPAR (1) $101 $133 $55 $105 $155 2000 2016 + 32 % (1) Smith Travel Research Quarterly/Monthly Hotel Review as of those dates. UPSCALE OUTPERFORMANCE We believe the outperformance of the Upscale segment is a direct re
Slide 8: Track Record of Outperformance
9.7% 5.7% 10.9% 7.3% 3.8% 6.7% 5.3% 8.4% 5.6% 2.1% 0.0% 2.0% 4.0% 6.0% 8.0% 10.0% 12.0% 2012 2013 2014 2015 2016 Summit Pro Forma STR Upscale Summit Pro Forma Average STR Upscale Average TRACK RECORD OF OUTPERFORMANCE RevPAR Performance: Summit Pro Forma Portfolio vs. STR Upscale (1) Summit’s pro fo
Slide 9: Top Tier Hotel EBITDA Margin
8 TOP TIER HOTEL EBITDA MARGIN 41.2% 37.6% 37.6% 35.9% 35.7% 34.5% 33.8% 33.1% 32.2% 32.1% 31.1% 30.6% 30.2% 30.2% 29.5% 27.6% 0% 10% 20% 30% 40% 50% CLDT INN APLE HT RLJ PEB LHO CHSP XHR AHT DRH RHP SHO AHP FCH HST Select-Service Full-Service Our strategy of investing in high - quality hotels with
Slide 10: Diverse Portfolio
24% 34% 29% 13% 0% 20% 40% 60% 80% 100% 1 Top 10 Top 25 Top 50 Other 43% 26% 22% 9% DIVERSE PORTFOLIO (1) As of December 31, 2016. (2) Based on pro forma hotel EBITDA for the twelve months ended December 31, 2016. Our portfolio consists of 81 premium - branded hotels, primarily in the Upscale segmen
Slide 11: Diversified EBITDA Contribution
Atlanta, GA 8.1% New Orleans, LA 7.9% San Francisco, CA 7.7% Minneapolis, MN 7.3% Nashville, TN 6.8% Chicago, IL 4.5% Phoenix, AZ 4.4% Dallas, TX 4.4% Denver, CO 4.2% Indianapolis, IN 3.7% Portland, OR 3.5% Austin, TX 3.0% Louisville, KY 2.8% Boulder, CO 2.6% New York, NY 2.5% Orlando, FL 2.4% 18 Ot
Slide 12: Creating Value Through Summitization
Our revenue and asset management team have over six decades of combined experience at Summit and an average of over 25 years in the industry. CREATING VALUE THROUGH “SUMMITIZATION” • Unlike many competitors, we utilize Corporate Revenue Managers. • Our Revenue Managers regularly visit every hotel in
Slide 13: Art of Unlocking Value
ART OF UNLOCKING VALUE Capital Recycling Execution of dispositions and acquisitions that continue to improve our overall portfolio quality and growth potential. Strategic Renovation Revitalizations that modernize the property resulting in improved guest experience and satisfaction. Brand Conversion
Slide 14: Capital Recycling
(1) Amount in thousands. (2) Represents a post - renovation capitalization rate including a 4.0% reserve for the year ended December 31, 2015. (3) Represents a post - renovation capitalization rate including a 4.0% reserve for the year ended December 31, 2016. (4) Represents a weighted average 2016
Slide 15: Strategic Renovations
We reconfigured public space and guestrooms to meet the higher expectations of today’s guests. $74.20 $81.13 $79.67 $95.70 $102.95 $109.59 25% 28% 31% 34% 37% 40% $60 $70 $80 $90 $100 $110 2011 2012 2013 2014 2015 2016 Hotel EBITDA Margin RevPAR RevPAR Hotel EBITDA Margin Hyatt Place Orlando, Florid
Slide 16: Capturing Embedded Value
(1) SNL Financial is based on the 2017E FactSet consensus EBITDA and Summit’s total enterprise value as of December 31, 2016. (2) Represents 2017E forecasted performance. CAPTURING EMBEDDED VALUE We converted six two - bedroom suites into six one - bedroom suites and six standalone queen guestrooms.
Slide 17: Brand Conversion
DoubleTree by Hilton San Francisco Airport North (1) Includes trailing twelve month operating results as of December 31, 2013. (2) Based on actual performance as of December 31, 2014. (3) Represents post - renovation capitalization rate as of December 31, 2014. (4) Based on the trailing twelve month
Slide 18: Exceptional Execution of Strategy
EXCEPTIONAL EXECUTION OF STRATEGY Our relentless attention to detail and aggressive approach towards proactive management enable us to deliver significant value to shareholders. $0.81 $0.97 $1.25 $1.41 $0.50 $0.75 $1.00 $1.25 $1.50 2013 2014 2015 2016 Adjusted FFO per Diluted Share 17 $10,400 $12,90
Slide 19: Portfolio Quality vs. Dispositions
18 $71 $113 $50 $60 $70 $80 $90 $100 $110 $120 Dispositions Pro forma Portfolio RevPAR 98 135 70 85 100 115 130 145 Dispositions Pro forma Portfolio Average Guestrooms per Hotel 32.1% 38.0% 30% 32% 34% 36% 38% 40% Dispositions Pro forma Portfolio Hotel EBITDA Margin $8,600 $16,800 $4,000 $6,000 $8,0
Slide 20: Conservative Capital Structure
$7 $8 $119 $48 $11 $126 $150 $140 $35 $0 $50 $100 $150 $200 2017 2018 2019 2020 2021 2022 2023+ Unsecured Revolving Credit Facility Unsecured Term Loan (7YR) Unsecured Term Loan (5YR) Secured Non-Recourse Loans Secured Recourse Loans 100% 90% 58% 48% 42% 25% 25% 21% 18% 13% 6% 6% 2% 0% 0% 0% 0% 20%
Slide 21: Well-Covered Dividend
Dividend Payout Ratio (2) (1) SNL data based on closing price on February 15, 2017. (2) SNL data based on 2017E FactSet Mean FFO per Share estimates. (3) SHO 2016 annual dividend based on the full - year dividend of $0.68 per share, which includes the special dividend. WELL - COVERED DIVIDEND Price
Slide 22: Superior Total Shareholder Return
101.9% 75.8% 36.6% 28.7% 19.7% 17.4% 16.5% 16.3% 13.1% 10.4% 10.2% 8.3% 4.3% - 19.5% 26.6% -20% 15% 50% 85% 120% INN RHP SHO AHT CHSP CLDT LHO RLJ DRH HST HT PEB FCH AHP Total Shareholder Return SNL U.S. REIT Hotel Index 21 SUPERIOR TOTAL SHAREHOLDER RETURN Total Shareholder Return by Year (2) 3 - Y
Slide 23: Portfolio Disposition – Recent News
PORTFOLIO DISPOSITION – RECENT NEWS TRANSACTION HIGHLIGHTS Seller: Summit Hotel OP, LP (and affiliates) Buyer: American Realty Capital Hospitality Trust, Inc. Hotels: 26 Guestrooms: 2,793 Sales Price: $347.4 million Sales Price per Key: $124,400 Estimated Capital Improvements: $20.4 million • On Jun
Slide 24: Summit Hotel Properties
SUMMIT HOTEL PROPERTIES NYSE: INN
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