Ashford Hospitality Trust Inc · NYSE:AHT
Ashford Hospitality Trust — IPO Roadshow (September 2020)
21 slides from Ashford Hospitality Trust's IPO roadshow presentation, Sep 23, 2020
Slide 1: Investor Presentation: Support the Preferred Stock Exchange Offer
Investor Presentation: Support the Preferred Stock Exchange Offer September 2020
Slide 2: Forward Looking Statements and Non-GAAP Measures
F o r w a r d L o o k i n g S t a t e m e n t s a n d N o n - G A A P M e a s u r e s 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 di
Slide 3: Where You Can Find Additional Information
The Company has filed a registration statement (including a prospectus) with the SEC for the offering to which this communication relates. Before you invest, you should read the prospectus in that registration statement and other documents the issuer has filed with the SEC for more complete informat
Slide 4: COVID-19 Has Decimated the Hotel Industry: Demand Evaporated
COVID-19 Has Decimated the Hotel Industry D e m a n dE v a p o r a t e dF o l l o w i n gG o v e r n m e n t S h u t d o w n s 10.0% 2020 YoY Hotel Performance Data1 0.0% -10.0% Jan FebMarAprMayJun JulAug -20.0% -30.0% -40.0% -50.0% -60.0% -70.0% -80.0% -90.0% SA OccupancySA Real ADRSA Real RevPAR 1
Slide 5: COVID-19 Has Decimated the Hotel Industry: Unprecedented Decline in Revenue
COVID-19 Has Decimated the Hotel Industry U n p r e c e d e n t e dD e c l i n ei n R e v e n u e 10.0% Annual Revenue Per Available Room1 % Change 0.0% -10.0% -20.0% -30.0% -9.3% 9/11 -16.2% Financial Crisis -40.0% -50.0% -60.0% -70.0% -57.5% COVID-19 Projected2 1 STR US Seasonally Adjusted Real Re
Slide 6: Leverage Has Amplified the Impact of COVID-19
Leverage Has Amplified the Impact of COVID-19 M o s t C o m m e r c i a lR e a lE s t a t eU s e s F i n a n c i a lL e v e r a g e Additional operating leverage makes hotels particularly vulnerable Short-term hotel leases mean revenue can disappear overnight, but fixed operating costs remain, and e
Slide 7: Negative Operating Cash Flows Crush Borrowers
Negative Operating Cash Flows Crush Borrowers N e a r l y T w o - T h i r d s o fS e c u r i t i z e dH o t e lL o a n s i n D i s t r e s s Securitized Hotel Loan Status1 35.9% 31.7% 32.5% PerformingPerforming - Default WatchlistIn Default/Forclosure/REO 1 Bloomberg CMBS loan status of 3,300 loans
Slide 8: Recovery Remains Extremely Uncertain
Recovery Remains Extremely Uncertain L e a d i n gF o r e c a s t s A g r e e :F u l lR e c o v e r y W i l lT a k e4 + Y e a r s 105.0% Leading RevPAR Forecasts As % of 2019 RevPAR1,2,3 95.0% 85.0% 75.0% 65.0% 55.0% 45.0% Potential Return to Pre-COVID RevPAR 2019 2020 2021 2022 2023 2024 CBREHVSSTR
Slide 9: Consistent With Prior Recovery Timelines
Consistent With Prior Recovery Timelines H i s t o r y A l s oS u g g e s t s F u l lR e c o v e r y W i l lT a k e4 + Y e a r s $85 Seasonally Adjusted RevPAR As of Q2 20201 $75 $65 Financial Crisis 5.4 Years Peak-to-Recovery 9/11 4.3 Years Peak-to-Recovery $55 $45 $35 $25 3 Month Moving Average -
Slide 10: AHT Moved Quickly in Response to COVID-19
AHT Moved Quickly in Response to COVID-19... P r o a c t i v eR e s p o n s et ot h eP a n d e m i cS i n c et h eB e g i n n i n g 4/1 – 4/18 Additional state and local stay-at-home orders force many businesses to close 4/1 – 4/30 Ashford Asset Management assumes direct oversight of property AP and
Slide 11: Aggressively Cut Costs and Secured Revenue
…Aggressively Cut Costs and Secured Revenue… A s s e t s P o s i t i o n e dt oP o t e n t i a l l y G e n e r a t eO p e r a t i n gC a s h f l o w $66.6M Reduced Q2 Payroll1 -70.9% Reduction in Labor Expense1 Case Study: Residence Inn Las Vegas Month Occupancy NOI Monthly Payroll, Taxes and Benefi
Slide 12: But Liquidity Remains a Concern
…But Liquidity Remains a Concern C a s h B u r n M a y A c c e l e r a t eW i t h F o r b e a r a n c eP e r i o d s E n d i n g Even as operating shortfalls begin to resolve, debt service is on the horizon With ~$17 million in monthly debt service and corporate expenses, AHT needs to address liquid
Slide 13: Alternatives Have Been Thoroughly Evaluated
Alternatives Have Been Thoroughly Evaluated W i p e O u t o fE q u i t y / B a n k r u p t c y aP o s s i b l eS c e n a r i o Cygnus Capital cited current cap rates of 10% on 2019 numbers1, consistent with recent transactions ~30% drop from pre-COVID values would wipe out common equity in liquidati
Slide 14: The Best Course of Action is Recapitalization
The Best Course of Action is Recapitalization S u r v i v i n gt oS e et h eR e c o v e r y W i l lL i k e l y M a x i m i z eV a l u e If NOI recovers and portfolio cap rates improve from 10% to 7% over the next 3-4 years, more than $1.6 billion in value could be recovered on remaining assets1 To u
Slide 15: Common Shareholder Approval Required for the Preferred Equity Exchange
Common Shareholder Approval Required F o rt h eP r e f e r r e dE q u i t y E x c h a n g e t oP r o c e e d Company is soliciting common shareholder approval to issue new shares of Common Stock required to proceed with the Preferred Exchange Offers1 Company is also soliciting consents to reclassify
Slide 16: May Create Path to Common Stock Value
May Create Path to Common Stock Value C o m m o n S h a r e h o l d e r s M a y B e n e f i t D e s p i t eI n c r e a s e dS h a r eC o u n t Exchange consideration represents a significant discount to liquidation preference 1 Assumes 70% of each Series of Preferred Stock is exchanged, $30 million
Slide 17: Vote FOR Both Proposals in the Proxy
Vote FOR Both Proposals in the Proxy T oE n a b l et h eP r e f e r r e dE x c h a n g e O f f e r s t oP r o c e e d If shareholders APPROVE the proposals: xPreferred Exchanges can proceed, creating a path to value for Common Stock xLarger equity base may permit easier, more efficient access to cap
Slide 18: Appendix: Clearing Up the Facts; Non-GAAP Reconciliation
Appendix Clearing Up the Facts Non-GAAP Reconciliation
Slide 19: Clearing Up the Facts: Addressing Misleading Statements Made by Cygnus Capital
Clearing Up the Facts A d d r e s s i n gM i s l e a d i n gS t a t e m e n t s M a d e b y C y g n u s C a p i t a l Misstatements that the Hotel Recovery is Accelerating While operations have improved somewhat since April this year, our hotels are not ramping up nearly as quickly as Cygnus Capital
Slide 20: Clearing Up the Facts: Addressing Misleading Statements Made by Cygnus Capital
Clearing Up the Facts A d d r e s s i n gM i s l e a d i n gS t a t e m e n t s M a d e b y C y g n u s C a p i t a l Lack of Understanding of the Hotel Transactions and our Capital Structure Cygnus Capital claims that asset sales would be a good strategy for the Company to pursue. Unfortunately, th
Slide 21: Non-GAAP Reconciliation: Net Income to Net Operating Income
Non-GAAP Reconciliation Ashford Hospitality Trust, Inc. Reconciliation of Net Income to Net Operating Income Year Ended December 31, 2019 Year Ended December 31, 2019 21
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