Ashford Hospitality Trust Inc · NYSE:AHT
Ashford Hospitality Trust — UBS Global Real Estate Conference 2011
43 slides from Ashford Hospitality Trust's conference presentation, Nov 30, 2011
Slide 1: UBS Global Real Estate Conference
UBS Global Real Estate Conference November 2011 Exhibit 99.1
Slide 2: Safe Harbor
Safe Harbor Safe Harbor 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. When we use the words “w
Slide 3: Ashford Overview
ASHFORD OVERVIEW ASHFORD OVERVIEW
Slide 4: Ashford Overview
Ashford Overview Ashford Overview • Favorable macro market dynamics • Focused portfolio, positioned for growth • Proactive debt and equity capital market strategies • Outperformance • High insider ownership
Slide 5: Attractive Supply/Demand Imbalance
Attractive Supply/Demand Imbalance Attractive Supply/Demand Imbalance • Demand increase is currently expected to outpace supply increase through 2014 Source: Smith Travel / PKF Research (Sep-Nov Edition forecast) -8.0 -6.0 -4.0 -2.0 0.0 2.0 4.0 6.0 8.0 10.0 Supply Growth Demand Growth
Slide 6: Attractive Industry Fundamentals
Attractive Industry Fundamentals Attractive Industry Fundamentals Source: Smith Travel Research (non-seasonally adjusted nominal monthly figures) $52.00 $54.00 $56.00 $58.00 $60.00 $62.00 $64.00 $66.00 $68.00 $70.00 $72.00 $74.00 Trailing 3-Mo Avg Seasonally-Adjusted Real RevPAR (2011 $’s)
Slide 7: PKF's Nominal US RevPAR Forecast
PKF’s Nominal US RevPAR Forecast 5-Year RevPAR Growth CAGR: 6.5% Source: Smith Travel Research / PKF Research (Sep-Nov Edition / preliminary Dec forecast) PKF’s Nominal US RevPAR Forecast
Slide 8: Ashford Snapshot
Ashford Snapshot Portfolio Statistics* Financial Statistics* Ashford Snapshot Total Enterprise Value $3.9 B Total Gross Assets $4.9 B Peer Comparison nd Largest # of Hotels # of Owned Rooms 26,139 # of Property Managers $ ADR $131.02 $ RevPAR $96.10 RevPAR Growth % 6.4% Recent Share Price $7.51 (11/
Slide 9: Broad Geography
Broad Geography WEST COAST TEXAS EAST COAST Broad Geography WEST COAST MIDDLE MIDDLE AMERICA AMERICA TEXAS EAST COAST West Coast includes Alaska EBITDA by Region EAST COAST: 51% WEST COAST: 22% TEXAS: 12% MIDDLE AMERICA: 15% • Ashford’s geographic footprint encompasses 29 states and Washington DC
Slide 10: MSA
MSA 16% 11% 73% MSA • The vast majority of Ashford’s EBITDA comes from top 25 markets, with nearly 90% coming from top 50 markets As % of TTM Q3 EBITDA 16% 11% 73% Top 25 Top 50 Other
Slide 11: Chain Scale
Chain Scale Chain Scale • Approximately 96% of Ashford’s EBITDA comes from upper upscale and upscale assets As % of TTM Q3 2011 EBITDA Luxury Upper Upscale Upscale Upper Midscale
Slide 12: Brand Family
Brand Family Brand Family • 85% of Ashford’s EBITDA comes from Marriott and Hilton branded assets As % of TTM Q3 EBITDA
Slide 13: Transient vs. Group vs. Contract
Transient vs. Group vs. Contract Transient vs. Group vs. Contract • Our customers are predominantly transient, with a strong emphasis on corporate business
Slide 14: Hotel EBITDA Margin Change Comparison
Hotel EBITDA Margin Change Comparison Hotel EBITDA Margin Change Comparison (106) (487) (58) (406) (600) (500) (400) (300) (200) (100) - YTD Q3 2011 HOTEL EBITDA MARGIN Y -O-Y CHANGE (BPS) (Peers include: BEE, DRH, FCH, HST, HT, LHO, PEB & SHO ) AHT Peer Avg
Slide 15: Hotel EBITDA Flows Comparison
Hotel EBITDA Flows Comparison Hotel EBITDA Flows Comparison 39% 8% 49% 41% 49% 51% 37% 53% 104% 64% 0% 20% 40% 60% 80% 100% 120% YTD Q3 2011 HOTEL EBITDA FLOWS (Peers include: BEE, DRH, FCH, HST, HT, LHO, PEB & SHO ) AHT Peer Avg
Slide 16: Debt Maturity Schedule
Debt Maturity Schedule Debt Maturity Schedule AHT Debt Maturity Schedule
Slide 17: Significantly Reduced Share Count
Significantly Reduced Share Count Significantly Reduced Share Count Source: SNL, Company Filings & Street Research. -41% 145% 76% 98% 30% 287% 108% 82% 118% -100.0% - 50.0% 0.0% 50.0% 100.0% 150.0% 200.0% 250.0% 300.0% 350.0% AHT BEE DRH FCH HST HT LHO SHO PEER AVG % Change in Fully Diluted Share Co
Slide 18: Consistent Earnings Growth
Consistent Earnings Growth Consistent Earnings Growth Ashford’s Historical AFFO per Share
Slide 19: AFFO per Share Outperformance
AFFO per Share Outperformance AFFO per Share Outperformance +48% -68% TTM AFFO Per Share (2007Q2 = 100%) Peers Include: BEE, DRH, FCH, HST, HT, LHO, SHO
Slide 20: Reinstated Dividend w/ Growth Potential
Reinstated Dividend w/ Growth Potential Though Ashford didn’t pay a dividend in 2009 & 2010, it could have covered its peak dividend at 1.3x in 2009 & 1.8x in 2010 Reinstated Dividend w/ Growth Potential N/A N/A 0.0x 0.5x 1.0x 1.5x 2.0x 2.5x 3.0x 3.5x 4.0x 4.5x 5.0x 0.9x 1.4x 1.4x 1.5x 1.6x 4.7x AFF
Slide 21: Most Highly-Aligned Management Team
Most Highly-Aligned Management Team Most Highly-Aligned Management Team Source: 2011 Proxy Filings Insider Ownership %
Slide 22: Ashford Overview
Ashford Overview Ashford Overview • Favorable macro market dynamics • Focused portfolio, positioned for growth • Proactive debt and equity capital market strategies • Outperformance • High insider ownership
Slide 23: Highland Transaction Update
HIGHLAND TRANSACTION UPDATE HIGHLAND TRANSACTION UPDATE
Slide 24: Highland Portfolio
Highland Portfolio Highland Portfolio Hilton Parsippany Renaissance Palm Springs The Melrose – Washington, DC Marriott DFW Airport Hyatt Regency Wind Watch Marriott Plaza San Antonio Boston Back Bay Hilton Hilton Tampa Westshore Renaissance Nashville Marriott Sugar Land Hyatt Regency Savannah Ritz-C
Slide 25: Highland Transaction Summary
Transformational 28-hotel, $1.3 billion acquisition with 8,084 rooms Primarily upper-upscale and luxury full-service assets Expands Ashford’s presence in key markets (Washington D.C and NY/NJ) and into new markets (Boston and Nashville) Significant growth potential with affiliate manager Remington t
Slide 26: Portfolio Upgrade
Portfolio Upgrade Portfolio Upgrade
Slide 27: Price Per Key Comparison
Price Per Key Comparison Price Per Key Comparison Source : Real Capital Analytics & company filings.
Slide 28: Replacement Cost per Key
Replacement Cost per Key Highland was purchased for $158,000 per key - a 44% discount to replacement cost Replacement Cost per Key Source: Estimated based Source: Estimated based on JP Morgan Research on JP Morgan Research Report Report Replacement Cost per Key Estimate
Slide 29: Highland Operational Goals
Highland Operational Goals Put cost structures in place to achieve maximum operating flow throughs Improve the non-brand managed properties RevPAR Yield Index Highland Operational Goals • When we took over the portfolio there were two primary operational goals: - portfolio was seriously neglected wh
Slide 30: Highland Portfolio - GOP Flow Comparison
Highland Portfolio - GOP Flow Comparison Highland Portfolio - GOP Flow Comparison • Ashford’s Asset Management and Remington’s combined expertise have enabled our legacy portfolio to outperform while Highland consistently lagged benchmark goals until we took over in March GOP Flow 0.2% Qtr 2011 8.8%
Slide 31: Highland Portfolio - Year Over Year Comparisons
Highland Portfolio - Year Over Year Comparisons <95> Pre-Ashford 218 Post-Ashford 280 Post-Ashford 8.8% Pre-Ashford 94.6% Post-Ashford 78.6% Post-Ashford Highland Portfolio - Year Over Year Comparisons GOP Flow GOP Flow GOP GOP Margin Margin Change Change BPS BPS
Slide 32: Highland Portfolio – Performance by Manager
Highland Portfolio – Performance by Manager 366 Remington 199 Non-Remington 93.3% Remington 58.7% Non-Remington Highland Portfolio – Performance by Manager GOP Margin Change GOP Margin Change BPS BPS GOP Flow GOP Flow
Slide 33: Highland Portfolio - GOP Flow Comparison
Highland Portfolio - GOP Flow Comparison Highland Portfolio - GOP Flow Comparison • Brand-managed properties have also shown significant flow improvement due to Ashford asset management expertise Brand-Managed GOP Flows by Month
Slide 34: Case Study – Crowne Plaza Ravinia
Case Study – Crowne Plaza Ravinia Financial Statistics TOD 2011 ADR Growth 3.1% Occupancy Growth -4.2% RevPAR Growth -1.2% GOP Margin Improvement 775 bps GOP Flow 238% Comp Set Rank 5 of 8 Case Study – Crowne Plaza Ravinia • Eliminated 6 managerial/supervisory positions • Despite RevPAR decrease, ba
Slide 35: Case Study – Hyatt Savannah
Case Study – Hyatt Savannah Financial Statistics TOD 2011 ADR Growth -4.5% Occupancy Growth RevPAR Growth - GOP Margin Improvement 7 bps GOP Flow 67.9% Comp Set Rank 1 of 6 0.6% 3.9% - Case Study – Hyatt Savannah • Since takeover, property has achieved $74K GOP $ surplus over AHT metric despite - 2.
Slide 36: Remington RevPAR Index Improvement
Remington RevPAR Index Improvement Remington RevPAR Index Improvement • RevPAR for Remington-managed properties is improving sooner than expected and is beginning to more closely match brand-managed properties
Slide 37: Highland Portfolio NOI
Highland Portfolio NOI Highland Portfolio NOI • Highland NOI is exceeding expectations, currently at 88% of first 12 months underwriting growth in only six months’ time $74 $76 $78 $80 $82 $84 $86 $88 Mar 2011 TTM Jun 2011 TTM Sep 2011 TTM Underwriting for Mar 2012 TTM Highland Portfolio Net Operati
Slide 38: Significant Operational Upside
Significant Operational Upside Significant Operational Upside • If Highland’s EBITDA was the same % of its peak level as our legacy portfolio, its EBITDA would be almost $10 million higher • This would equate to about an additional $1.40 in share price at a 12x EBITDA multiple 60% 65% 70% 75% 80% 85
Slide 39: Key Capex Renovations
Key Capex Renovations Lobby & Restaurant Guestrooms & Public Space Guestrooms & Bistro Lobby Courtyard Denver Hyatt Windwatch Marriott Omaha The Churchill The Melrose Courtyard Savannah Marriott San Antonio Courtyard Boston Tremont Hilton Boston Back Bay Ritz-Carlton Atlanta HGI Virginia Beach The S
Slide 40: Case Study – CY Denver Lobby Bistro
Case Study – CY Denver Lobby Bistro GSS Lobby Rankings 2009 2010 1H 2011 2H 2011 Pre-Renovation Pre-Renovation 510 out of 780 560 out of 808 During Renovation 771 out of 818 263 out of 819 Post-Renovation Case Study – CY Denver Lobby Bistro • Courtyard Bistro Lobby renovation was completed in Q2 201
Slide 41: Case Study – Melrose Hotel
Case Study – Melrose Hotel Financial Statistics TTM Q3 2011 ADR $161.29 Occupancy 75.9% RevPAR $122.45 NOI $3.6m Peak NOI (2007) $6.2m RevPAR Index 84.7% Comp Set Rank 7 of 7 Case Study – Melrose Hotel • Last renovation in 2002 • RevPAR Index dropped from 101.4% in 2007 to 83.6% YTD September 2011 •
Slide 42: Highland Transaction Conclusion
Highland Transaction Conclusion We purchased a remarkable portfolio for nearly half of its replacement cost and materially below what our peers are paying for assets We have made significant progress in achieving operational flow throughs and pushing RevPAR yield index In only six months’ time our a
Slide 43: UBS Global Real Estate Conference
UBS Global Real Estate Conference November 2011
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