Skyline Investments Inc · TASE:SKLN
Skyline Investments — Investor Presentation (June 2022)
31 slides from Skyline Investments's investor presentation, Jun 30, 2022
Slide 1: Corporate Presentation
Corporate June 30, 2022 Presentation
Slide 2: Cautionary Statement
Cautionary Statement General This presentation has been prepared by Skyline Investments Inc. (the "Company“ or “Skyline”) 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-
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 value-add income producing select-service hotels mainly in suburbs of major metropolitan areas. Skyline seeks to create shareholder value and deliver superior risk a
Slide 4: Select Service Hotels
Select Service Hotels Select service is a segment of the hotel industry that focuses on mid-market business travelers during the week and family travel on the weekend, providing stable and predictable cash flow Select service hotels are typically smaller properties that are located in suburban m
Slide 5: Corporate Profile
Corporate Profile 16 Income Producing Assets 2,749 Guestrooms $581m/$310m Total Assets/Equity 53% Equity to Total Assets Ratio Baa1.il (Stable Outlook) Bond Rating
Slide 6: Select Senior Management
Select Senior Management Blake Lyon CA, CPA Robert Waxman, CPA CEO CFO Blake Lyon has extensive experience in Robert Waxman has over 20 years of hotel and resort asset management in experience in accounting, finance, and real Canada and internationally. Before estate. Prior to his appointment, Mr. j
Slide 7: Current Ownership Structure
Current Ownership Structure 49.5% Alex Shnaider 1.54% 27.46% Public Blake Lyon 1.2% 20.3% ILDC 7
Slide 8: Business Strategy
Business Strategy Skyline’s Strategy Acquisition Targets Acquisition of value-add, income producing Focus on the US and Canada select-service hotel properties Stabilized in-place income Investment in hotel renovations to improve earnings, cash flow and value Strong potential growth Continued monetiz
Slide 9: Portfolio Map and Acquisition Focus
Portfolio Map and Acquisition Focus Main Areas of New Acquisitions 16 INCOME PRODUCING ASSETS | 2,749 HOTEL ROOMS | 15 CITIES IN THE US AND CANADA9
Slide 10: Main Operating Assets in the United States
Main Operating Assets in the United States The Hyatt Regency Arcade, Cleveland, OH
Slide 11: 13 Courtyard by Marriott Hotels
13 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 New Number of Number of Acquisition Price Per Mortgage – Capital Credit Hotels Rooms Price Room Apri
Slide 12: Hyatt Regency Arcade
Hyatt Regency Arcade SKYLINE IN V ES TM ENT S S HYATT REGENCY CLEVELAND
Slide 13: 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 14: Renaissance Cleveland Hotel
Renaissance Cleveland Hotel
Slide 15: 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 the top complaint from hotel guests and is also expected to Notable visitors in the hotel’s history: Dwight D. Eisenhower, Ge
Slide 16: Transformational Transaction – Sale of Canadian Resorts
Transformational Transaction – Sale of Canadian Resorts • Skyline completed the majority sale of its Canadian resorts for an aggregate purchase price of CAD $210M in December 2021 • Freed Corp, through a newly formed subsidiary, Resort Communities LP ("Resort LP") then combined these assets with Mus
Slide 17: Other Legacy Assets Totaling CAD $165M
Other Legacy Assets Totaling CAD $165M Bear Valley Resort, California – CAD $25M gross book value 3 hours from San Francisco; 1,700 acres, 52 room hotel, expansion options Short-term equity and 29% interest in Resorts Residual interest in Deerhurst, Horseshoe, Communities LP – CAD $35M book value
Slide 18: Second Quarter 2022 Operating Results
Second Quarter 2022 Operating Results Q2 2022 same asset revenue1 increased by 50% to CAD $30.8M compared to CAD $20.5M in Q2 2021, due to continued improvement in demand and a relaxation in operating restrictions related to COVID-19 Q2 2022 same asset NOI1 decreased to CAD $5.3M compared to CAD
Slide 19: Recent Non-Operating Events
Recent Non-Operating Events Skyline announced that it had entered into an agreement to purchase the Courtyard by Marriott hotel in Ithaca, New York for USD $11.3M plus customary closing costs; closing was executed during Q3 2022 Completed the largest corporate transaction in its 20-year history
Slide 20: Summary of Periodic Results
Summary of Periodic Results CAD ‘000 H1 2022 H1 2021 YE 2021 Revenue from Hotels and Resorts 62,849 53,110 129,293 Sale of Residential Real Estate 1,321 4,314 7,453 Total Revenue 64,170 57,424 136,746 NOI from Hotels and Resorts 13,496 14,752 33,081 Total Adjusted EBITDA 9,593 11,260 24,501 FFO 5,13
Slide 21: Balance Sheet Highlights
Balance Sheet Highlights CAD ‘000, except where December 31, June 30, 2022 June 30, 2021 noted 2021 Total Assets 581,556 641,276 579,704 1 Gross Debt 221,680 293,100 223,602 Cash and Equivalents 40,607 29,819 61,489 Net Debt 181,073 263,281 162,113 Shareholders’ Equity 278,933 230,791 266,249 Non-Co
Slide 22: Skyline Going Forward
Skyline Going Forward New capital focus in 2022/2023 and thereafter: Acquiring select-service hotels, which will provide more stable and predictable earnings and cash flow growth Select-service hotels are much more predicable due to their stable customer base of business travelers during the wee
Slide 23: Share Price Discount to NAV
Share Price Discount to NAV NAV was 45.22 NIS per share1 compared to the share price on June 30, 2022 of 24.58 NIS, a discount of 45.5% Share price discount to NAV 45.22 38.74 39.52 38.83 40.18 35.51 36.24 34.20 34.04 34.04 45.5% 26.34 27.5 24.58 21.34 22.41 17.18 14.46 14.49 12.46 10.86 NAV per sha
Slide 24: Financial Strength and Opportunities
Financial Strength and Opportunities Total equity to total assets ratio of 53% Low LTV (48% for hotels and resorts) Cash balance of CAD $40.6M Additional net cash flow of CAD $106M during the next 5 years from VTBs In December 2021, Skyline completed the largest corporate transaction in it
Slide 25: Skyline's Value Proposition
Skyline’s Value Proposition Select-service focus on properties in both Canada and US Proven and experienced internal management team Strong relationship with Marriott Strategic partnerships providing ability to renovate assets in any state or province Diversified third-party hotel manageme
Slide 26: Thank You!
Thank You! Questions? Please contact Rob Waxman | Chief Financial Officer 647-207-5312 | robw@skylineinvestments.com WWW.SKYLINEINVESTMENTS.COM
Slide 27: Appendix
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Slide 28: Net Asset Value (in 000's CAD)
Net Asset Value (in 000’s CAD) Loan Balance June Ownership BV 2021 NOI TTM NOI NOI/BV LTV Equity 30, 2022 Hotels and Resorts Hyatt Regency Arcade 100% 70,280 4,556 4,500 6.4% 22,072 31% 48,208 Renaissance Hotel 50% 65,847 3,957 3,632 5.5% 26,428 40% 39,419 Courtyard Hotels 100% 202,130 9,938 13,246
Slide 29: Debt Composition and Maturities
Debt Composition and Maturities Bond B – Payments are current As of June 30, 2022 3% (CAD’000) Renaissance Loan – due September 16, 2022. 1% The Company is in the process of negotiating a Weighted Average Term Maturity – 2.99 years long-term extension with its current lender, 10% who has agreed
Slide 30: Asset Ownership Breakdown
Asset Ownership Breakdown Property Property Owner Manager Brand/Franchise Leased Bear Valley Skyline Skyline Independent None Hyatt Regency Skyline Hyatt Hyatt Regency None Cleveland Marriott Renaissance Skyline Aimbridge Marriott Renaissance None Cleveland Marriott Courtyard Skyline Aimbridge, Urgo
Slide 31: Expected Net Cash Flow from Vendor Take-Back Loans (VTB)
Expected Net Cash Flow from Vendor Take-Back Loans (VTB) VTB Loans (CAD’000) Q3 – Q4 2022 2023 2024 and thereafter Total Port McNicoll 1,200 2,400 27,768 31,368 Blue Mountain Retail - - 3,800 3,800 Vetta Spa - - 804 804 Total - Development 1,200 2,400 32,372 35,972 Freed Transaction VTB 742 1,483 67
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