Skyline Investments Inc · TASE:SKLN
Skyline Investments — Q3 2021 Earnings Presentation
41 slides from Skyline Investments's earnings presentation, Sep 30, 2021
Slide 1: Corporate Presentation
Corporate September 30, 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: Majority Sale of Canadian Resort and Development Assets
Majority Sale of Canadian Resort and Development Assets On September 19, 2021, Skyline announced that it entered into two agreements of purchase and sale for a 100% interest in the resort assets and surrounding development lands at Deerhurst Resort and Horseshoe Resort as well as the remaining devel
Slide 4: 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 5: Corporate Profile
Corporate Profile 18 Income Producing Assets 3,261 Guestrooms $662m/$297m Total Assets/Equity 45% Equity to Total Assets Ratio Baa1.il (Negative Outlook) Bond Rating 2,315 Units Available for Development
Slide 6: COVID-19 Recap and Update
COVID-19 Recap and Update The COVID-19 pandemic, which began at the end of 2019, continues to have wide-ranging implications for the global economy and the hotel industry in particular In December 2020, the local jurisdictions where Deerhurst, Horseshoe, and Bear Valley are located implemented c
Slide 7: Q3 2021 Results
Q3 2021 Results Revenue from hotels and resorts increased by 79% Our US Hotels continue to show occupancy that is to CAD $45.1M compared to CAD $25.3M in Q3 2020 approaching pre-pandemic levels. In Q3 2021, the Courtyard portfolio achieved average occupancy of Q3 2021 Adjusted EBITDA was CAD $11.7M
Slide 8: Occupancy Levels Before and During COVID-19
Occupancy Levels Before and During COVID-19 Canadian Resorts US Hotels Deerhurst and Horseshoe Resorts Select-Service Courtyard 13 Portfolio In late December 2020, local public health restrictions necessitated the Steady recovery in occupancy since April 2020 low due to increase in closure of ce
Slide 9: US and Canadian Government Stimulus Programs
US and Canadian Government Stimulus Programs Paycheque Protection Program (“PPP”) CAD $9.3M (US $6.7M) in cash was received during Q2 2020, and a further CAD $9.5M (US $7.5M) was received during 1H 2021. As part of this program, the portion of any of these loans spent on payroll, utilities, intere
Slide 10: Debt Composition and Maturities
Debt Composition and Maturities Bond A and B – Payments are current As of September 30, 2021 (CAD’000) 1% Bond A – Matures January 2023, can be repaid through obtaining a new property level 4% Weighted Average Term Maturity – 1.15 years 6% 15% mortgage or sale of the asset in advance of maturity
Slide 11: Expected Net Cash Flow from Vendor Take-Back Loans (VTB)
Expected Net Cash Flow from Vendor Take-Back Loans (VTB) 2024 and VTB Loans (CAD’000)1 Q4 2021 2022 2023 Total thereafter Second Nature (313) (2,439) 3,288 - 536 Port McNicoll 3,600 2,400 2,400 27,168 35,568 Blue Mountain Retail - - - 3,800 3,800 Vetta Spa - - - 804 804 Total 3,287 (39) 5,688 31,772
Slide 12: 9M 2021 Cash Movement Summary
9M 2021 Cash Movement Summary 9M 2021 Cash Movement Summary (CAD’000) Opening Cash Balance 22,436 Operating Cash Flow 33,769 Proceeds from Loans, Net of Repayments (3,131) Restricted Long Term Deposit (4,931) Capital Improvements, Net of Disposal Proceeds (4,979) Repayment of Bonds (6,453) Distribut
Slide 13: Share Price Discount to NAV
Share Price Discount to NAV NAV was 39.52 NIS per share1 compared to the share price on September 30, 2021 of 22.41 NIS Skyline's share price was trading at a 43% discount to its NAV as of September 30, 2021 (Skyline uses fair value accounting, therefore its NAV is equal to its Book Value at Sep
Slide 14: Financial Strength and Opportunities
Financial Strength and Opportunities Total equity to total assets ratio of 45% Low LTV (55% for hotels and resorts, 3% for lands)1 Cash balance of CAD $35M; approximately CAD $19M in additional restricted bank and other deposits that can be accessed in certain circumstances Additional net ca
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 | 3,261 HOTEL ROOMS | 18 CITIES IN THE US AND CANADA 16
Slide 17: Select Senior Management
Select Senior Management Blake Lyon CA, CPA Robert Waxman Paul Mondell CEO CFO Senior VP Development Blake Lyon has extensive experience in Robert Waxman has over 20 years of In the last 6 years Paul Mondell has hotel and resort asset management in experience in accounting, finance, and served as VP
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 2021 9M 2020 YE 2020 Revenue from Hotels and Resorts 98,226 73,814 91,484 Sale of Residential Real Estate 4,897 33,024 37,878 Total Revenue 103,123 106,838 129,362 NOI from Hotels and Resorts 28,566 9,299 11,359 Total Adjusted EBITDA 22,926 6,814 7,884 FFO 8,2
Slide 20: Balance Sheet Highlights
Balance Sheet Highlights CAD ‘000, except where noted September 30, 2021 December 31, 2020 Total Assets 662,360 637,863 Gross Debt1 294,629 306,105 Cash and Equivalents 34,983 22,436 Net Debt 259,646 283,669 Shareholders’ Equity 261,016 226,044 Non-Controlling Interest 35,699 30,385 Total Equity 296
Slide 21: Net Asset Value (in 000's CAD)
Net Asset Value (in 000’s CAD) Loan Balance Ownership BV NOI 2020 TTM Q3 2021 NOI LTV Equity September 30, 2021 Hotels and Resorts Hyatt Regency Arcade 100% 64,852 (1,517) 3,267 21,939 34% 42,913 Renaissance Hotel 50% 64,724 (1,895) 4,660 26,552 41% 38,172 Courtyard Hotels 100% 179,470 3,985 8,429 1
Slide 22: Main Operating Assets in the United States
Main Operating Assets in the United States The Hyatt Regency Arcade, Cleveland, OH
Slide 23: 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 24: 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 25: 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 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: Courtyard Tucson Renovation – Significant Hotel Upgrade
Courtyard Tucson Renovation – Significant Hotel Upgrade BEFORE AFTER BEFORE AFTER 28
Slide 29: Hyatt Regency Arcade
Hyatt Regency Arcade SKYLINE IN V ES TM ENT S S HYATT REGENCY CLEVELAND
Slide 30: 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 31: Renaissance Cleveland Hotel
Renaissance Cleveland Hotel
Slide 32: 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 33: Bear Valley
Bear Valley SKYLINE
Slide 34: 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 35: 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 36: Ontario Premier Resorts Portfolio
Ontario Premier Resorts Portfolio Skyline will become 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 cou
Slide 37: Transaction Overview
Transaction Overview Sale of Skyline’s Canadian resorts, and all adjacent land for CAD $210M to a limited partnership (Resort LP) controlled by Freed Corp., a Toronto-based real estate developer and hotelier I. Deerhurst: CAD $106.15M (51% of total) II. Horseshoe: CAD $59.025M (28% of total) III.
Slide 38: Proceeds Details
Proceeds Details1 CAD $210M transaction will be composed of the following: CAD $109M in cash (52%) due on Closing CAD $60M VTB (29%) due over four years at a 5% annual interest rate I. CAD $10M due February 29, 2024 (month 28) II. CAD $25M due April 30, 2025 (month 42) III. CAD $25M due Octobe
Slide 39: Appendix
Appendix
Slide 40: 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 41: Thank You!
Thank You! Questions? Please contact Rob Waxman | Chief Financial Officer 647-207-5312 | robw@skylineinvestments.com WWW.SKYLINEINVESTMENTS.COM