Braemar Hotels & Resorts Inc. · NYSE:BHR
Braemar Hotels & Resorts — Q4 2023 Earnings Presentation
46 slides from Braemar Hotels & Resorts's earnings presentation, Mar 1, 2024
Slide 1: 4th Quarter 2023 Earnings Update
4th Quarter 2023 Earnings Update
Slide 2: Forward Looking Statements and Non-GAAP Measures
Forward Looking Statements and Non-GAAP Measures 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.
Slide 3: Experienced Management Team
Experienced Management Team RICHARD J. STOCKTON DERIC S. EUBANKS, CFA CHRISTOPHER C. NIXON Chief Executive Officer & Chief Financial Officer Executive Vice President & President Head of Asset Management 28 years of hospitality 23 years of hospitality 14 years of hospitality experience experien
Slide 4: Company Fact Sheet
Company Fact Sheet Since inception in 2013, we have significantly increased Gross Asset Value and EBITDA for our iconic and irreplaceable portfolio $184.7M NYSE: $1.8B EQUITY MARKET CAP(1) BHR ENTERPRISE VALUE(1) HIGHEST RevPAR LODGING REIT Total Assets(2) Number of Hotels % of Total Hotel Rev Hotel
Slide 5: BHR Positioned Ideally for Outperformance
BHR Positioned Ideally for Outperformance All Time High Industry Performance Continuing Optimal Portfolio Composition Recent Results & Developments Liquidity & Liability Management The Notary Hotel Company Presentation | March 2024 5
Slide 6: All Time High Industry Performance Continuing
Ritz-Carlton Reserve Dorado Beach All Time High Industry Performance Continuing
Slide 7: Industry RevPAR Continues to Exceed 2019
Industry RevPAR Continues to Exceed 2019 U.S. KPIs, Indexed to 2019 Occupancy Index ADR Index RevPAR Index 140 140 140 122 119 118 120 120 120 114 114 108 100 95 96 97 100 100 95 87 83 80 80 80 60 60 60 40 40 40 20 20 20 0 0 0 2021 2022 2023 2024F 2021 2022 2023 2024F 2021 2022 2023 2024F Source: Lo
Slide 8: Real Industry ADR and RevPAR Nearing Full Recovery
Real Industry ADR and RevPAR Nearing Full Recovery Real ADR Continues to Rise Occupancy Down Slightly $160 60% 54% 53% $128 $127 50% $120 40% $80 30% $40 20% $0 10% Q4 '19 Q4 '20 Q4 '21 Q4 '22 Q4 '23 0% Real ADR Nominal ADR Q4 '19 Q4 '20 Q4 '21 Q4 '22 Q4 '23 Real RevPAR Stabilizing $90 $75 $69 $67 $
Slide 9: 2024 RevPAR Forecast
2024 RevPAR Forecast Industry RevPAR Projected to Increase 4.1% in 2024 2024 Forecasted Growth YoY 6.00% 5.5% 5.5% 5.4% 5.00% 4.4% 4.1% 4.00% 3.7% 3.4% 2.9% 2.9% 3.00% 2.6% 2.3% 2.00% 1.2% 1.0% 1.00% 0.6% 0.7% 0.5% 0.3% 0.2% 0.00% Luxury Upper Upscale Upscale Upper Midscale Midscale Economy Source:
Slide 10: Optimal Portfolio Composition
Bardessono Hotel and Spa Optimal Portfolio Composition Taking Advantage of Strategic Asset Class
Slide 11: High Quality Assets with High Barriers to Entry
High Quality Assets with High Barriers to Entry Properties Resort Hotel Q4 2023 YTD EBITDA(2) Ritz-Carlton St. Thomas $22,628 Ritz-Carlton Sarasota $22,381 Four Seasons Scottsdale $21,863 Ritz-Carlton Reserve Dorado Beach $20,924 Hilton Torrey Pines $17,289 Pier House $15,011 Park Hyatt Beaver Creek
Slide 12: Portfolio ADR Well Above Pre-Pandemic Levels; Occupancy Stabilizing Below
Portfolio ADR Well Above Pre-Pandemic Levels; Occupancy Stabilizing Below ADR(1) Stabilizing – Q4 2019 to Q4 2023 Occupancy(1) Down Slightly – Q4 2019 to Q4 2023 900 90% Pandemic 800 80% +49% 700 70% -16% -15% 600 60% -13% 500 50% +35% 400 40% 300 30% +10% 200 20% 100 10% - 0% Q4'19 Q4'20 Q4'21 Q4'2
Slide 13: Portfolio RevPAR Above Pre-Pandemic Levels
Portfolio RevPAR Above Pre-Pandemic Levels RevPAR(1) Up – Q4 2019 to Q4 2023 600 Key Observations 500 Urban properties +30% nearing full recovery 400 300 Resort properties still significantly +15% up versus 2019 200 -7% Average RevPAR still 100 above 2019 levels - Q4'19 Q4'20 Q4'21 Q4'22 Q4'23 Key:
Slide 14: High Exposure to Luxury Hotels and Resorts
High Exposure to Luxury Hotels and Resorts Ritz-Carlton Drives Q4 YTD Hotel EBITDA(1) Luxury Hotels Drive Q4 YTD Hotel EBITDA(1) Luxury $160,000 $100,000 $141,314 $140,000 Ritz-Carlton $80,000 $120,000 $72,015 $100,000 $60,000 Upper Marriott/ Four Upscale Autograph $80,000 Seasons $65,125 Hilton $32
Slide 15: Recent Results & Developments
Ritz-Carlton St. Thomas Recent Results & Developments Solid Q4 Results Signal Potential For Steady Recovery
Slide 16: Q4 EBITDA Results Supported By Strong Resort Contribution
Q4 EBITDA Results Supported By Strong Resort Contribution Pier House Resort & Spa (1) In thousands (2) Please refer to slides 28-39 for a reconciliation to the most directly comparable non-GAAP financial metric Company Presentation | March 2024 16
Slide 17: A Slight Reduction in ADRs on Tough Comps Shapes Q4 Results
A Slight Reduction in ADRs on Tough Comps Shapes Q4 Results Comparable Hotel Operating Results(1) 2023 Q4 2022 Q4 % Variance 2023 ADR $452 $469 (4%) Occupancy 64% 64% 0%(2) RevPAR $288 $301 (4%) Total Hotel Revenue(3) $179,216 $185,917 (4%) Hotel EBITDA(3) $45,116 $50,832 (11%) Hotel EBITDA Margin 2
Slide 18: Occupancy Improving; ADR Stabilizing
Occupancy Improving; ADR Stabilizing HOTEL OCCUPANCY(1) 100% 79% 80% 65% 67% 60% 52% 40% 30% 20% 0% 2019 2020 2021 2022 2023 HOTEL ADR(1) $500 $458 $482 $458 $400 $333 $296 $300 $200 Cameo Beverly Hills $100 $- 2019 2020 2021 2022 2023 (1) As reported in Earnings Releases: 2019 as reported on 2/25/2
Slide 19: ADR Decrease Impacts Metrics: Quarter Highlights
ADR Decrease Impacts Metrics Quarter Highlights • Comparable RevPAR for all hotels decreased 4% over the prior year quarter to $288. Comparable ADR decreased 3.6% over the prior year quarter to $452 and Comparable Occupancy decreased 0.9% over the prior year quarter to 63.6%. • Adjusted funds from o
Slide 20: Top Q4 2023 Capital Expenditures
Top Q4 2023 Capital Expenditures $21.5M Spent in Q4 2023; $77.1M Spent in 2023 Capital Hilton Ritz-Carlton Lake Tahoe Ritz-Carlton Sarasota Washington, D.C. Truckee, CA Sarasota, FL Guestroom Renovation & Key Guestroom Renovation Spa Renovation Additions Total Project Cost $37.1M Total Project Cost
Slide 21: Major 2024 Planned Capital Expenditures
Major 2024 Planned Capital Expenditures $90M - $100M Range in Capital Expenditures Planned in 2024 Ritz-Carlton St. Thomas Ritz-Carlton Lake Tahoe Ritz-Carlton Sarasota • Restaurant renovation • Public space renovation • Spa renovation (0% complete) (85% complete) Capital Hilton Bardessono Hotel Cam
Slide 22: Liquidity & Liability Management
Ritz-Carlton Sarasota Liquidity & Liability Management Maintain Liquidity, Manage Maturities and Interest Cost
Slide 23: Liability Management Strategy
Liability Management Strategy Liquidity Position (1) Pro Forma Maturity Schedule (2)(3) $400.0 15% 13.2% CASH & CASH EQUIVALENTS $85.6M $300.0 11.8% 12.2% 10.9% (% of Gross Assets) 10% $80.9M (in millions) RESTRICTED CASH $200.0 4.3% $293.2 $17.7M DUE FROM 3RD PARTY $262.2 $270.5 5% $242.6 MANAGERS
Slide 24: BHR Positioned Ideally for Outperformance
BHR Positioned Ideally for Outperformance All Time High Industry Performance Continuing Optimal Portfolio Composition Recent Results & Developments Liquidity & Liability Management Four Seasons Scottsdale Company Presentation | March 2024 24
Slide 25: Appendix
Ritz-Carlton Lake Tahoe Appendix
Slide 26: Indebtedness
Indebtedness Company Presentation | March 2024 26
Slide 27: Indebtedness
Indebtedness Company Presentation | March 2024 27
Slide 28: Reconciliation of Net Income (Loss) to Comparable Hotel EBITDA by Hotel
Reconciliation of Net Income (Loss) to Comparable Hotel EBITDA by Hotel Company Presentation | March 2024 28
Slide 29: Reconciliation of Net Income (Loss) to Comparable Hotel EBITDA by Hotel
Reconciliation of Net Income (Loss) to Comparable Hotel EBITDA by Hotel Company Presentation | March 2024 29
Slide 30: Reconciliation of Net Income (Loss) to Comparable Hotel EBITDA by Hotel
Reconciliation of Net Income (Loss) to Comparable Hotel EBITDA by Hotel Company Presentation | March 2024 30
Slide 31: Reconciliation of Net Income (Loss) to Comparable Hotel EBITDA by Hotel
Reconciliation of Net Income (Loss) to Comparable Hotel EBITDA by Hotel Company Presentation | March 2024 31
Slide 32: Reconciliation of Net Income (Loss) to Comparable Hotel EBITDA by Hotel
Reconciliation of Net Income (Loss) to Comparable Hotel EBITDA by Hotel Company Presentation | March 2024 32
Slide 33: Reconciliation of Net Income (Loss) to Comparable Hotel EBITDA by Hotel
Reconciliation of Net Income (Loss) to Comparable Hotel EBITDA by Hotel Company Presentation | March 2024 33
Slide 34: Reconciliation of Net Income (Loss) to Comparable Hotel EBITDA
Reconciliation of Net Income (Loss) to Comparable Hotel EBITDA Company Presentation | March 2024 34
Slide 35: Reconciliation of Net Income (Loss) to Comparable Hotel EBITDA
Reconciliation of Net Income (Loss) to Comparable Hotel EBITDA Company Presentation | March 2024 35
Slide 36: Reconciliation of Net Income (Loss) to Comparable Hotel EBITDA
Reconciliation of Net Income (Loss) to Comparable Hotel EBITDA Company Presentation | March 2024 36
Slide 37: Reconciliation of Net Income (Loss) to Comparable Hotel EBITDA
Reconciliation of Net Income (Loss) to Comparable Hotel EBITDA Company Presentation | March 2024 37
Slide 38: Reconciliation of Net Income (Loss) to Comparable Hotel EBITDA
Reconciliation of Net Income (Loss) to Comparable Hotel EBITDA Note: As reported, used in Comparable Hotel EBITDA Slide 17 Company Presentation | March 2024 38
Slide 39: Reconciliation of Net Income (Loss) to Comparable Hotel EBITDA
Reconciliation of Net Income (Loss) to Comparable Hotel EBITDA Company Presentation | March 2024 39
Slide 40: Reconciliation of Net Income (Loss) to EBITDAre and Adjusted EBITDAre
Reconciliation of Net Income (Loss) to EBITDAre and Adjusted EBITDAre (1) Incentive fee adjustment represents the true-up for the actual 2022 incentive fee Company Presentation | March 2024 40
Slide 41: Reconciliation of Net Income (Loss) to EBITDAre and Adjusted EBITDAre
Reconciliation of Net Income (Loss) to EBITDAre and Adjusted EBITDAre Company Presentation | March 2024 41
Slide 42: Reconciliation of Net Income (Loss) to EBITDAre and Adjusted EBITDAre
Reconciliation of Net Income (Loss) to EBITDAre and Adjusted EBITDAre Company Presentation | March 2024 42
Slide 43: Reconciliation of Net Income (Loss) to Adjusted FFO Q4
Reconciliation of Net Income (Loss) to Adjusted FFO Q4 In thousands except per share amounts Effective beginning with the third quarter of 2022 we no longer included the effect of the Series B Cumulative Convertible Preferred Stock and convertible notes on an “as-converted” basis in AFFO. For compar
Slide 44: Reconciliation of Net Income (Loss) to Adjusted FFO Q3
Reconciliation of Net Income (Loss) to Adjusted FFO Q3 In thousands except per share amounts Effective beginning with the third quarter of 2022 we no longer included the effect of the Series B Cumulative Convertible Preferred Stock and convertible notes on an “as-converted” basis in AFFO. For compar
Slide 45: Reconciliation of Net Income (Loss) to Adjusted FFO Q2
Reconciliation of Net Income (Loss) to Adjusted FFO Q2 In thousands except per share amounts Effective beginning with the third quarter of 2022 we no longer included the effect of the Series B Cumulative Convertible Preferred Stock and convertible notes on an “as-converted” basis in AFFO. For compar
Slide 46: Reconciliation of Net Income (Loss) to Adjusted FFO Q1
Reconciliation of Net Income (Loss) to Adjusted FFO Q1 In thousands except per share amounts Effective beginning with the third quarter of 2022 we no longer included the effect of the Series B Cumulative Convertible Preferred Stock and convertible notes on an “as-converted” basis in AFFO. For compar
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