Ashford Hospitality Trust Inc · NYSE:AHT
Ashford Hospitality Trust — BAML Global Real Estate Conference 2012
25 slides from Ashford Hospitality Trust's conference presentation, Sep 13, 2012
Slide 1: BAML Global Real Estate Conference
JAN. NF BAML Global Real Estate Conference September 2012
Slide 2: Safe Harbor
Safe Harbor 2 In keeping with the SEC’s “Safe Harbor” guidelines, certain statements made during this presentation could be considered forward-looking and subject to certain risks and uncertainties that could cause results to differ materially from those projected. When we use the words “will likely
Slide 3: Economic & Industry Overview
Economic & Industry Overview
Slide 4: U.S. Starting to Deleverage
U.S. Starting to Deleverage 4 Source: U.S. Federal Reserve & Historical Statistics of the United States: - Cambridge 0% 50% 100% 150% 200% 250% 300% 350% 400% 450% Home Mortgage Other Household Debt State & Local Government Federal Government Nonfinancial Business Consumer Credit Domestic Financial
Slide 5: Real GDP Growth %
Real GDP Growth % 5 Source: U.S. Dept. of Commerce: BEA&Historical Statistics of the United States: - Cambridge 2011 Real GDP Growth: 1.7% - The U.S. left the gold standard in 1971 - Most recessions are induced by the Fed through interest rate increases - Real growth has been in the 3-4% range - GDP
Slide 6: Hotel Demand Driven by Economy
Hotel Demand Driven by Economy Source: Smith Travel Research & U.S. Dept. of Commerce: BEA 6 R-squared = 0.61 Hotel Demand Growth % vs. Real GDP Growth - Demand for more hotel room nights matches growth in GDP fairly closely - I believe that because of our deleveraging, GDP, and therefore room night
Slide 7: U.S. Demand Will Outpace Supply
U.S. Demand Will Outpace Supply 7 Source: Smith Travel Research & PKF PKF Forecast
Slide 8: Real RevPAR is Cyclical
Real RevPAR is Cyclical Source: Smith Travel Research & U.S. Dept. of Labor: BLS 8 $52 $54 $56 $58 $60 $62 $64 $66 $68 $70 $72 $74 Seasonally-Adjusted Real RevPAR (2012$, Trailing 3-Mo Average)
Slide 9: RevPAR Forecast - PKF
RevPAR Forecast - PKF Source: Smith Travel Research & PKF 9 5-Year RevPAR Growth CAGR: 5.8% 7.9% 6.1% -2.0% -16.7% 5.4% 8.2% 5.8% 6.6% 7.8% 5.9% 2.9% -20.0% -15.0% -10.0% -5.0% 0.0% 5.0% 10.0% 2006 2007 2008 2009 2010 2011 2012F 2013F 2014F 2015F 2016F Historical RevPAR Growth Forecasted RevPAR Grow
Slide 10: Potential Industry EBITDA Growth Rates
Potential Industry EBITDA Growth Rates 10 *Based on PKF RevPAR/ADR/Occupancy projections and EBITDA growth resulting from PKF EBITDA change regression equation With strong potential RevPAR gains, those companies with reasonable flow-throughs could experience significant EBITDA growth PKF estimates 5
Slide 11: Advantages of Lodging REITs
Advantages of Lodging REITs 11 Tax benefits High - quality real estate retains value Hard asset Not a financial asset Non - recourse debt Liquidity Benefits Inflation hedge Dividend paying - Include double taxation issue as well as Bush tax cuts
Slide 12: Company Highlights
Company Highlights
Slide 13: Attractive Dividend Yield & Coverage
Attractive Dividend Yield & Coverage 13 Source: Company filings, Bloomberg & First Call Ashford has both a high dividend yield and strong dividend coverage - Ashford’s dividend yield AND dividend coverage exceed the peer average - Note that this TTM coverage will likely come down a bit due to the bu
Slide 14: Total Shareholder Return
Total Shareholder Return 14 Peer average includes: BEE, CHSP, CLDT, DRH, FCH, HST, HT, LHO, PEB, SHO Trailing Total Shareholder Returns as of 9/4/12 Source: Bloomberg - Ashford outperforms the peer index on a trailing basis for the past 2, 3, 4, 5, 6, 7 & 8 years - On an IRR basis, the 3-year Ashfor
Slide 15: Most Highly-Aligned Management
Most Highly-Aligned Management 15 Insider ownership % Source: Company Filings - Hersha’s insider ownership would be 4% when shares owned by a real estate company in Argentina, attributed to one of their Board members, are excluded - EVERY employee at Ashford owns stock, and all the senior executives
Slide 16: Upcoming Maturities & Debt Yields
Upcoming Maturities & Debt Yields 16 Upcoming maturities through 2014 include: TTM June 2012 weighted average debt yields on these maturities are 13.6% Aareal Torrey Pines / Capital Hilton $143.7M Matures Aug 2013 13.5% TTM Debt Yield Highland Cigna Loans $101.4M Matures Jan-Apr 2013 17.2% TTM Debt
Slide 17: Available Liquidity
Available Liquidity 17 Undrawn $145m credit facility $139m of unrestricted cash at end of Q2 ‘12 Preferred equity ATM facility Common equity ATM facility Potential refinancing proceeds Excess cash flow Available Liquidity - We have many sources of liquidity should we need or choose to tap into - We
Slide 18: Safety & Optionality
Safety & Optionality 18 Portfolio A: Safety Portfolio B: Optionality & Upside • Approximately 100-120% of equity value • ~$2.0 billion of debt • Positive cash flow • Weighted average maturity of 3.6 years • All debt non-recourse • Approximately 0-(20)% of equity value • $1.0 to $1.2 billion of debt
Slide 19: Highland Hospitality Update
Highland Hospitality Update
Slide 20: Highland Opportunities
Highland Opportunities 20 Franchise properties Operating flow throughs Revenues Strategic Capex • Looking for opportunities to create long-term value and operational efficiency through Remington management • Hilton Back Bay, Hyatt Windwatch, Courtyard Savannah & Residence Inn Tampa • Right-sizing th
Slide 21: Highland Year One GOP Flows
Highland Year One GOP Flows 21 0% 20% 40% 60% 80% 100% 120% One Year Pre-Takeover One Year Post-Takeover 25.20% 102.70%
Slide 22: Highland NOI Exceeds Underwriting
Highland NOI Exceeds Underwriting 22 $72 $74 $76 $78 $80 $82 $84 $86 $88 $90 $92 Mar 2011 TTM Jun 2011 TTM Sep 2011 TTM Dec 2011 TTM Mar 2012 TTM U/W for Mar 2012
Slide 23: Next Steps for Ashford
Next Steps for Ashford
Slide 24: Next Steps for Ashford
Next Steps for Ashford 24 Allow portfolio to naturally delever Diligently work the capital markets Thorough research & quantitative analysis Scour market for acquisition opportunities Grow cash balance Intense operational focus to grow EBITDA Must be long-term accretive to stock price Franchised, fu
Slide 25: BAML Global Real Estate Conference
JAN. “a BAML Global Real Estate Conference September 2012
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