Skyline Investments Inc · TASE:SKLN
Skyline Investments — Q3 2020 Earnings Presentation
44 slides from Skyline Investments's earnings presentation, Sep 30, 2020
Slide 1: Corporate Presentation
Corporate September 30, 2020 Presentation
Slide 2: Cautionary Statement
Cautionary Statement General This presentation has been prepared by Skyline Investments Inc. (the "Company") as a general presentation about the Company. This presentation is not intended to replace the need to review the formal reports published by the Company to the public on the Tel-Aviv Stock Ex
Slide 3: Skyline's Vision & Mission
Skyline’s Vision & Mission We’re creating one of North America’s leading hospitality real estate investment companies, with a focus on income producing properties. Skyline seeks to create shareholder value and deliver superior risk adjusted returns through the acquisition of income producing propert
Slide 4: Corporate Profile
Corporate Profile 18 Income Producing Assets 3,297 Guestrooms $645m/$245m Total Assets/Equity 38.1% Equity to Total Assets Ratio Baa1.il Bond Rating 2,315 Units Available for Development
Slide 5: COVID-19
COVID-19 ▪ In March 2020, the World Health Organization declared COVID-19 to be a pandemic. In an effort to contain and mitigate the spread of COVID-19, many countries, including Canada and the United States, imposed unprecedented restrictions on travel, group gatherings and non-essential activities
Slide 6: Well Positioned to Manage Through COVID-19
Well Positioned to Manage Through COVID-19 Strong Liquidity Position Government Support Paying our Debt ▪ CAD $34.5M unrestricted cash in Bank ▪ CAD $9.3M (US $6.7M) low interest rate ▪ Current on all scheduled interest and ▪ Additional CAD $14.4M expected cash and partially forgivable loans receive
Slide 7: Skyline's Immediate Response to Reduce COVID-19 Impact
Skyline’s Immediate Response to Reduce COVID-19 Impact In response to the COVID-19 crisis, the Company implemented immediate countermeasures, including: ▪ Significant staffing reduction ▪ Reduction of operational costs ▪ Enhanced payment and cash flow control ▪ All food and beverage outlets temporar
Slide 8: Occupancy Levels Before and During COVID-19
Occupancy Levels Before and During COVID-19 Began to see impact from COVID-19 in March and occupancy appears to have bottomed out in April Canadian Resorts US Hotels Deerhurst and Horseshoe Resorts Select-Service Courtyard 13 Portfolio ▪ Canadian Resorts saw an increase in occupancy since ▪ Strong i
Slide 9: Canadian and US Government Stimulus Programs
Canadian and US Government Stimulus Programs Canada US Canada Employment Wage Subsidy (“CEWS”) Paycheque Protection Program (“PPP”) ▪ CEWS covers up to 75% of the first CAD $58.7K ▪ CAD $9.3M (US $6.7M) in funds were received during normally paid to eligible employees, representing a Q2 2020. As par
Slide 10: Debt Composition and Maturities
Debt Composition and Maturities ▪ Bond A and B – Payments are current. As of September 30, 2020 (CAD’000) ▪ Bond A - Matures January 2023, can be repaid through obtaining a new property level Weighted Average Term Maturity – 2.17 years 5% 4% 14% mortgage or sale of the asset in advance of 6% Weighte
Slide 11: Expected Net Cash Flow from Vendor Take-Back Mortgages (VTB)
Expected Net Cash Flow from Vendor Take-Back Mortgages (VTB) 2023 and VTB Loans (CAD’000)1 Q4 2020 2021 2022 Total Thereafter Blue Mountain2 - - - 12,870 12,870 Horseshoe Golf Lands - 1,496 - - 1,496 Total VTB Net Cash Flow - 1,496 - 12,870 14,366 Note 1: The Company reached an alternative agreement
Slide 12: Q3 2020 Cash Movement Summary
Q3 2020 Cash Movement Summary Q3 2020 Cash Movement Summary (CAD’000) Opening Cash Balance 40,995 Operating Cash Flow (2,761) Capital Improvements (1,027) Repayment of Bonds (3,524) Proceeds from Long Term Loans , Net of Repayments 1,119 Foreign Exchange & Other (262) Ending Cash Balance 34,540 ▪ CA
Slide 13: Share Price Discount to NAV
Share Price Discount to NAV ▪ NAV was 34.04 NIS per share compared to its share price on September 30, 2020 of 10.86 NIS ▪ Skyline's share price was trading at a 68% discount to its NAV as of September 30, 2020 (Skyline uses fair value accounting, therefore its NAV is equal to its Book Value at Sept
Slide 14: Financial Strength and Flexibility
Financial Strength and Flexibility ▪ Total equity to total assets ratio of 38.1% ▪ Net debt to Net CAP1 ratio of 54.2% ▪ Cash balance of CAD $34.5M; approximately CAD $12.1M in additional restricted bank and other deposits that can be accessed in certain circumstances ▪ Additional cash flow of CAD $
Slide 15: Business Strategy
Business Strategy Skyline’s Strategy Acquisition Targets Acquisition of hospitality properties to Focus on the US and Canada further decrease seasonality and diversify our geographic presence Stabilized in-place income Continued monetization of land assets to Strong potential growth less than 10% of
Slide 16: Portfolio Map
Portfolio Map 18 INCOME PRODUCING ASSETS | 3,297 HOTEL ROOMS | 18 CITIES IN THE US AND CANADA 16
Slide 17: Select Senior Management
Select Senior Management Blake Lyon CA, CPA Robert Waxman CEO, Board Director CFO Blake Lyon has an extensive experience Robert Waxman has over 20 years of in hotel and resort asset management in experience in accounting, finance, and Canada and Internationally. Before real estate. Prior to this app
Slide 18: Current Ownership Structure
Current Ownership Structure 49.37% Alex Shnaider 1.53% 27.66% Public Blake Lyon 1.19% 20.25% ILDC 18
Slide 19: Summary of Periodic Results
Summary of Periodic Results CAD ‘000 9M 2020 9M 2019 FY 2019 Income from Hotels and Resorts 73,814 149,962 193,585 Sale of Residential Real Estate 33,024 39,789 41,658 Total Revenue 106,838 189,751 235,243 NOI from Hotels and Resorts 9,299 35,271 42,214 Total Adjusted EBITDA 6,814 36,239 40,849 FFO
Slide 20: Balance Sheet Highlights
Balance Sheet Highlights CAD ‘000, except where noted September 30, 2020 December 31, 2019 Total Assets 644,770 675,846 Gross Debt1 324,956 302,814 Cash and Equivalents 34,540 26,874 Net Debt 290,416 275,940 Shareholders’ Equity 221,833 252,374 Non-Controlling Interest 23,577 24,467 Total Equity 245
Slide 21: Net Asset Value (in 000's CAD)
Net Asset Value (in 000’s CAD) Loan Balance Ownership BV NOI 2019 TTM Q3 2020 NOI LTV Equity September 30, 2020 Hotels and Resorts Deerhurst Resort (1) 100% 73,709 6,106 4,612 47,179 64% 26,530 Horseshoe Resort 100% 38,850 2,854 2,996 18,467 48% 20,383 Hyatt Regency Arcade 100% 67,449 5,736 186 24,9
Slide 22: Appendix
Appendix
Slide 23: Main Operating Assets in the United States
Main Operating Assets in the United States The Hyatt Regency Arcade, Cleveland, OH
Slide 24: Courtyard by Marriott Hotels
13 Courtyard by Marriott Hotels Courtyard Birmingham Hoover, Courtyard Manassas Battlefield Park Hoover, AL Manassas, Virginia Courtyard Toledo Airport Courtyard Fort Myers Cape Coral Courtyard Deerfield Arlington Heights Toledo, OH Fort Myers, FL Deerfield, IL
Slide 25: Courtyard by Marriott Hotels Properties Overview
Courtyard by Marriott Hotels Date of PROPERTIES Location Brand Management Service Level Acquisition OVERVIEW 9 States Courtyard by Aimbridge, Select Service November (USD) Marriott Urgo 14th, 2017 Number of Number of Acquisition Price Per Five Year Capital Credit Hotels Rooms Price Room Mortgage Lin
Slide 26: Courtyard by Marriott: Ft. Myers Renovations
Courtyard by Marriott Active Asset Management – Ft. Myers Courtyard Renovations Before Renovation After Renovation 26
Slide 27: Hyatt Regency Arcade
HYATT REGENCY ENE, i) me) oO O — <x > Oo c i) 0 (3) [aa oa) Y oO > a5
Slide 28: Hyatt Regency Arcade
Hyatt Regency Arcade Improvements Overview ▪ Recently completed renovations of all rooms and meeting The historical Cleveland Arcade was built by John D. spaces. The renovation has improved the hotel’s Rockefeller in 1890 competitive advantage The hotel is an attractive event destination and hosts 6
Slide 29: Hyatt Regency Arcade: Room Renovations
Hyatt Regency Arcade Active Asset Management – Hyatt Room Renovations Before Renovation After Renovation 29
Slide 30: Renaissance Cleveland Hotel
Renaissance Cleveland Hotel
Slide 31: Renaissance Cleveland Hotel
Renaissance Cleveland Hotel Overview Improvements Historical Heritage asset established in 1918 as The Cleveland Hotel ▪ Skyline completed the full HVAC replacement. This was Notable visitors in the hotel’s history: Dwight D. Eisenhower, Gerald the top complaint from hotel guests and is also expecte
Slide 32: Bear Valley
Bear Valley SKYLINE BEAR VALLEY YLINE RESORT
Slide 33: Bear Valley
Bear Valley Overview Improvements A ski resort in Southern California, three and a half hours from ▪ Since the acquisition invested USD $3.2M in equipment and San Francisco improvements Acquired on December 2014 for US $3.7M from the Company’s ▪ In 2017 Skyline invested USD $5.5M on a new ski lift w
Slide 34: Main Operating Assets in Canada
Main Operating Assets in Canada
Slide 35: Deerhurst
Deerhurst SKYLINE
Slide 36: Deerhurst
Deerhurst Overview Future Potential World-class four-season resort located in Muskoka near ▪ Increasing NOI by streamlining operations Toronto, Canada ▪ Sold 147 of 150 units at Lakeside Lodge. 89 units have joined the The new 150-room Lakeside Lodge was completed during hotel’s rental program 2019,
Slide 37: Horseshoe Resort
Horseshoe Resort SKYLINE HORSESHOE A SKYLINE RESOR BARRIE
Slide 38: Horseshoe Resort
Horseshoe Resort Overview Improvements An all-season resort based around the Horseshoe Ski Mountain, ▪ Sold and delivered all 44 units at Slopeside Lodge one of the closest Ski Resort to Toronto, Canada ▪ Officially opened the new Horseshoe Lake in August 2017, enhancing summer activities and snow m
Slide 39: Land Sales and Development
Land Sales and Development
Slide 40: Lakeside Lodge
Lakeside Lodge SKYLINE
Slide 41: Slopeside Lodge
Slopeside Lodge 41
Slide 42: Blue Mountain Development Lands
Blue Mountain Development Lands Second Nature Phase 3/4 Second Nature Phase 1 Snowbridge Townhomes 42
Slide 43: Asset Ownership Breakdown
Asset Ownership Breakdown Property Property Owner Manager Brand/Franchise Leased Deerhurst Skyline Skyline Independent None Horseshoe Valley Skyline Skyline Independent None Bear Valley Skyline Skyline Independent None Hyatt Regency Skyline Hyatt Hyatt Regency None Cleveland Marriott Renaissance Sky
Slide 44: Thank You!
Thank You! Questions? Please contact Rob Waxman | Chief Financial Officer 647-207-5312 | robw@skylineinvestments.com WWW.SKYLINEINVESTMENTS.COM