Skyline Investments Inc · TASE:SKLN
Skyline Investments — Investor Presentation (December 2021)
39 slides from Skyline Investments's investor presentation, Dec 31, 2021
Slide 1: Corporate Presentation
Corporate December 31, 2021 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 in secondary markets. Skyline seeks to create shareholder value and deliver superior risk adjusted returns through t
Slide 4: Corporate Profile
Corporate Profile 16 Income Producing Assets 2,749 Guestrooms $580m/$297m Total Assets/Equity 51% Equity to Total Assets Ratio Baa1.il (Stable Outlook) Bond Rating
Slide 5: 2021 Results
2021 Results Revenue from hotels and resorts increased by 41% Skyline completed the largest corporate transaction to CAD $129.3M compared to CAD $91.5M in 2020 in its 20-year history with the sale of Deerhurst, Horseshoe, and the remaining development lands at 2021 Adjusted EBITDA1 improved by 211%
Slide 6: Majority Sale of Canadian Resort and Development Assets
Majority Sale of Canadian Resort and Development Assets On December 6, 2021, Skyline completed the Freed Transaction for an aggregate purchase price of CAD $210M, subject to standard working capital adjustments, with Freed Corp. ("Freed"). Freed, through a newly formed subsidiary, Resort Communities
Slide 7: Occupancy Levels Before and During COVID-19
Occupancy Levels Before and During COVID-19 US Hotels Select-Service Courtyard 13 Portfolio Full-Service Cleveland Hotels ▪ Steady recovery in occupancy since April 2020 low due to ▪ Average occupancy during 2021 was 43% compared to 22% increase in domestic leisure travel, rebound in air travel and
Slide 8: Debt Composition and Maturities
Debt Composition and Maturities ▪ Bond B – Payments are current As of December 31, 2021 (CAD’000) ▪ Renaissance Loan – due March 16, 2022. The 2% Company is in the process of negotiating a Weighted Average Term Maturity – 1.15 years long-term extension with its current lender, 10% Weighted Average I
Slide 9: Expected Net Cash Flow from Vendor Take-Back Loans (VTB)
Expected Net Cash Flow from Vendor Take-Back Loans (VTB) VTB Loans (CAD’000) 2022 2023 2024 and thereafter Total Second Nature1 (2,275) 3,017 - 742 Port McNicoll1 2,400 2,400 27,768 32,568 Blue Mountain Retail - - 3,800 3,800 Vetta Spa - - 804 804 Total - Development 125 5,417 32,372 37,914 Freed Tr
Slide 10: 2021 Cash Movement Summary
2021 Cash Movement Summary 2021 Cash Movement Summary (CAD’000) Opening Cash Balance 22,436 Operating Cash Flow 27,518 Proceeds from Loans, Net of Repayments (21,372) Restricted Long Term Deposit (7,609) Capital Improvements (7,527) Proceeds from Disposals 103,983 Proceeds from Swap Disposition 6,20
Slide 11: Share Price Discount to NAV
Share Price Discount to NAV NAV was 38.83 NIS per share1 compared to the share price on December 31, 2021 of 26.34 NIS Share price discount to NAV 40.00 38.74 39.52 38.83 35.51 36.24 34.20 34.04 34.04 29% 32% 28.56 26.34 21.34 22.41 17.18 14.46 14.49 12.46 10.86 NAV per share (NIS) Price per share (
Slide 12: Net Asset Value (in 000's CAD)
Net Asset Value (in 000’s CAD) Loan Balance Ownership BV NOI 2020 NOI 2021 NOI/BV LTV Equity December 31, 2021 Hotels and Resorts Hyatt Regency Arcade 100% 64,531 (1,517) 4,556 7.1% 21,871 34% 42,660 Renaissance Hotel 50% 64,404 (1,895) 3,957 6.1% 26,222 41% 38,182 Courtyard Hotels 100% 185,378 3,98
Slide 13: Financial Strength and Opportunities
Financial Strength and Opportunities ▪ Total equity to total assets ratio of 51% ▪ Low LTV (51% for hotels and resorts) ▪ Cash balance of CAD $61.5M ▪ Additional net cash flow of CAD $108M during the next 5 years from VTBs. ▪ In December, Skyline completed the largest corporate transaction in its 20
Slide 14: 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 Active asset management and optimization Strong potential growth of cash flow fro
Slide 15: Skyline Going Forward
Skyline Going Forward New capital focus in 2022/2023 and thereafter: ▪ Skyline's focus going forward will be on 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
Slide 16: Portfolio Map
Portfolio Map 16 INCOME PRODUCING ASSETS | 2,749 HOTEL ROOMS | 15 CITIES IN THE US AND CANADA 16
Slide 17: Select Senior Management
Select Senior Management Blake Lyon CA, CPA Robert Waxman 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 Canada and internationally. Before real estate. Prior to his appointment, Mr. joinin
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 YE 2021 YE 2020 YE 2019 Revenue from Hotels and Resorts 129,293 91,484 193,585 Sale of Residential Real Estate 7,453 37,878 41,658 Total Revenue 136,746 129,362 235,243 NOI from Hotels and Resorts 33,081 11,359 42,214 Total Adjusted EBITDA 24,501 7,884 40,849 FFO
Slide 20: Balance Sheet Highlights
Balance Sheet Highlights CAD ‘000, except where noted December 31, 2021 December 31, 2020 Total Assets 579,704 637,863 1 Gross Debt 223,602 306,105 Cash and Equivalents 61,489 22,436 Net Debt 162,113 283,669 Shareholders’ Equity 266,249 226,044 Non-Controlling Interest 30,827 30,385 Total Equity 297
Slide 21: Main Operating Assets in the United States
Main Operating Assets in the United States The Hyatt Regency Arcade, Cleveland, OH
Slide 22: 13 Courtyard by Marriott Hotels
13 Courtyard by Marriott Hotels Courtyard Birmingham Hoover, Courtyard Manassas Battlefield Park Hoover, AL Manassas, VA Courtyard Toledo Airport Courtyard Fort Myers Cape Coral Courtyard Tucson Airport Arlington Toledo, OHHeights Fort Myers, FL Tucson, AZ
Slide 23: 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 24: Courtyard Renovations – Preparing for Growth
Courtyard Renovations – Preparing for Growth ▪ The Company completed a full interior renovation of Courtyard Tucson, Arizona at the end of Q4 2020, using a low occupancy period to upgrade our asset and prepare for the post-pandemic rebound in demand ▪ After the successful completion of the renovatio
Slide 25: Courtyard Tucson Renovation – Significant Hotel Upgrade
Courtyard Tucson Renovation – Significant Hotel Upgrade BEFORE AFTER BEFORE AFTER 25
Slide 26: Courtyard Tucson Renovation – Significant Hotel Upgrade
Courtyard Tucson Renovation – Significant Hotel Upgrade BEFORE AFTER BEFORE AFTER 26
Slide 27: Courtyard Tucson Renovation – Significant Hotel Upgrade
Courtyard Tucson Renovation – Significant Hotel Upgrade BEFORE AFTER BEFORE AFTER 27
Slide 28: Hyatt Regency Arcade
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Slide 29: 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 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 the top complaint from hotel guests and is also expected to Notable visitors in the hotel’s history: Dwight D. Eisenhower, Ge
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 San Francisco and 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: The Freed Transaction
The Freed Transaction Courtyard Resort Deerhurst Birmingham Hoover, Blue Mountain Lands Hoover, AL Huntsville, ON The Blue Mountains, ON Muskoka Bay Resort Horseshoe Resort Courtyard Resort Horseshoe Deerfield Arlington Heights Gravenhurst, ON Barrie, ON Deerfield, Barrie, ON IL
Slide 35: Ontario Premier Resorts Portfolio
Ontario Premier Resorts Portfolio Skyline became a 29%1 partner in Resort LP along with Freed, who will now own an expanded portfolio of premier resorts in Ontario Embracing Peninsula Lake, Deerhurst Resort is year-round retreat for a Muskoka vacation or getaway to Ontario’s famous “cottage country”
Slide 36: Proceeds Details
Proceeds Details CAD $210M transaction composed of the following: ▪ CAD $109M of gross cash on closing (52%) ▪ CAD $60M VTB (29%) due over four years at a 5% annual interest rate I. CAD $10M due April, 2024 II. CAD $25M due June, 2025 III. CAD $25M due December, 2025 ▪ CAD $33M (16%) non-cash equity
Slide 37: Appendix
Appendix
Slide 38: 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 39: Thank You!
Thank You! Questions? Please contact Rob Waxman | Chief Financial Officer 647-207-5312 | robw@skylineinvestments.com WWW.SKYLINEINVESTMENTS.COM
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