Investor Presentation. September 2011

Transcription

1 Investor Presentation September 2011

2 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 will likely result, may, anticipate, estimate, should, expect, believe, intend, or similar expressions, we intend to identify forward-looking statements. Such forward-looking statements include, but are not limited to, our business and investment strategy, our understanding of our competition, current market trends and opportunities, projected operating results, and projected capital expenditures. These forward-looking statements are subject to known and unknown risks and uncertainties, which could cause actual results to differ materially from those anticipated including, without limitation: general volatility of the capital markets and the market price of our common stock; changes in our business or investment strategy; availability, terms and deployment of capital; availability of qualified personnel; changes in our industry and the market in which we operate, interest rates or the general economy, and the degree and nature of our competition. These and other risk factors are more fully discussed in the Company s filings with the Securities and Exchange Commission. EBITDA is defined as net income before interest, taxes, depreciation and amortization. EBITDA yield is defined as trailing twelve month EBITDA divided by the purchase price. EBITDA, FFO, AFFO, CAD and other terms are non-gaap measures, reconciliationsofwhichhavebeenprovidedinpriorearnings releases and filings with the SEC. This overview is for informational purposes only and is not an offer to sell, or a solicitation of an offer to buy or sell, any securities of Ashford Hospitality Trust, Inc. and may not be relied upon in connection with the purchase or sale of any such security. 2

3 Agenda Favorable macro market dynamics Focused portfolio, positioned for growth Proactive debt and equity capital market strategies Outperformance Accretive Highland transaction High insider ownership 3

4 Attractive Supply/Demand Imbalance Demand increase is currently expected to outpace supply increase through F 2012F 2013F 2014F 2015F Year-over-Year % Growth Source: Smith Travel / PKF Research (forecast) Supply Growth Demand Growth 4

5 Attractive Industry Fundamentals $74 $72 $70 $68 $66 $64 $62 $60 $58 $56 $54 $52 Seasonally-Adjusted Real RevPAR (2011 $'s) Source: Smith Travel Research (nonseasonally adjusted nominal monthly figures) 5

6 PKF s Nominal US RevPAR Forecast 10.0% 5.0% 7.7% 6.1% 5.5% 7.2% 7.3% 8.1% 7.0% 3.2% 0.0% -5.0% -2.0% -10.0% 5-Year RevPAR Growth CAGR: 6.5% -15.0% -20.0% Source: Smith Travel Research / PKF Research (forecast) -16.6% F 2012F 2013F 2014F 2015F Historical RevPAR Growth Forecasted RevPAR Growth 6

7 Ashford Snapshot Portfolio Statistics Total Enterprise Value Total Gross Assets Peer Comparison $4.1 B $5.0 B 2 nd Largest Financial Statistics Recent Share Price $8.10 (8/31/11) # Fully Diluted Shares 84.3 M Leverage Ratio 59.8% # of Hotels 124 Debt Wtd. Avg. Maturity 4.4 Years # of Owned Rooms 26,139 # of Property Managers 6 $ ADR $ $ RevPAR $ RevPAR Growth % 6.3% Debt Wtd. Avg. Cost 3.20% Quarterly Dividend $0.10 Dividend Yield 4.9% TTM AFFO per Share $1.80 Dividend Coverage 4.5x 7

8 Broad Geography Ashford s geographic footprint encompasses 29 states and Washington DC West Coast includes Alaska WEST COAST MIDDLE AMERICA EAST COAST EBITDA by Region TEXAS EAST COAST: 52% WEST COAST: 22% TEXAS: 12% MIDDLE AMERICA: 14% 8

9 MSA The vast majority of Ashford s EBITDA comes from top 25 markets, with nearly 90% coming from top 50 markets As % of TTM Q EBITDA 16% 11% 73% Top 25 Top 50 Other 9

10 Chain Scale Approximately 97% of Ashford s EBITDA comes from upper upscale and upscale assets As % of TTM Q EBITDA 38% 1% 2% 59% Luxury Upper Upscale Upscale Upper Midscale 10

11 Brand Family Approximately 85% of Ashford s EBITDA comes from Marriott and Hilton branded assets As % of TTM Q EBITDA 3% 4% 4% 3% 33% 52% Marriott Hilton Hyatt Starwood Intercontinental Independent 11

12 Transient vs. Group vs. Contract Our customers are predominantly transient, with a strong emphasis on corporate business 25% 4% 16% 55% Transient - Corporate Transient - Leisure Group Contract 12

13 Hotel EBITDA Margin Change Comparison HOTEL EBITDA MARGIN Y-O-Y CHANGE (BPS) (Peers include: BEE, DRH, FCH, HST, HT, LHO, PEB & SHO) (100) (200) (106) (58) (300) (400) (500) (487) (406) (600) YTD 2011 Peer Avg AHT 13

14 Hotel EBITDA Flows Comparison 120% 100% HOTEL EBITDA FLOWS (Peers include: BEE, DRH, FCH, HST, HT, LHO, PEB & SHO) 104% 80% 70% 60% 40% 39% 51% 37% 49% 53% 41% 46% 20% 0% 8% YTD 2011 Peer Avg AHT 14

15 Debt Maturity Schedule $1,200,000 AHT Debt Maturity Schedule $1,000,000 $ Debt (000's) $800,000 $600,000 $400,000 $200,000 $ Beyond Fixed-Rate Floating-Rate 15

16 Significant Industry Dilution # of Common Shares Issued / (Repurchased) (Millions) (20.0) Peer Common Stock Issuances / (Repurchases) - Q2 '07 to Q2 '11 Peers Include: BEE, DRH, FCH, HST, HT, LHO & SHO 120.0% 100.0% 80.0% 60.0% 40.0% 20.0% 0.0% Peer Stock Price Index (Q2 '07 = 100%) Source: Bloomberg # of Common Shares Issued / (Repurchased) Peer Stock Price Index 16

17 Significant Shareholder Accretion Ashford Common Stock Issuances / (Repurchases) - Q2 '07 to Q2 '11 # of Common Shares Issued / (Repurchased) (Millions) (10.0) (20.0) (30.0) 120% 100% 80% 60% 40% 20% 0% AHT Stock Price Indexed (Q2 '07 = 100%) Source: Bloomberg # of Common Shares Issued / (Repurchased) AHT Stock Price 17

18 Significantly Reduced Share Count 350% 300% % Change in Fully Diluted Share Count : 6/30/07 vs. Current 288% 250% 200% 150% 100% 145% 76% 98% 111% 82% 118% 50% 30% 0% -50% -41% -100% AHT BEE DRH FCH HST HT LHO SHO PEER AVG 18 Source: SNL, Company Filings & Street Research.

19 Potential Impact of Interest Rate Hedges in 2011 Principal Interest Expense (est.) Interest Rate (est.) Total Debt $3.2 billion $173 million 5.4% Swap Impact ($31.9 million) Flooridor Impact (if Libor stays below 50 bps in 2011) ($39.0 million) TOTAL $3.2 billion $102 million 3.2% Note: Assumes 30-Day Libor of 25 bps 19

20 Consistent Earnings Growth $2.00 $1.80 Ashford's Historical AFFO per Share $1.80 $1.60 $1.50 $1.40 $1.20 $1.00 $0.80 $0.96 $1.13 $1.28 $1.31 $1.12 $0.60 $0.40 $0.20 $- $0.41 $ Q 2011 TTM20

21 AFFO per Share Outperformance TTM AFFO Per Share (2007Q2 = 100%) Peers Include: BEE, DRH, FCH, HST, HT, LHO, SHO 160% 140% +43% 120% 100% 80% 60% 40% 20% -71% 0% Source: SNL & Company Filings Ashford Peer Average 21

22 Accretive Highland Transaction 28 hotel portfolio (19 full-service, 9 selectservice) with 8,084 rooms Total consideration of $1.3 billion ($158,000 per key) 2010 EBITDA multiple 13.4x Operational upside 2010 EBITDA flows of 18% vs. AHT s of 104% Remington took over management of 17 assets NOI 36% below peak 22

23 Portfolio Upgrade 100.0% Legacy Ashford vs. Highland 2010 EBITDA Concentration 90.0% 80.0% 70.0% 60.0% 73% 75% 57% 67% 62% 76% 63% 50.0% 40.0% 30.0% 20.0% 24% 10.0% 0.0% Top 25 Markets Luxury / Upper- Upscale Full-Service Urban Legacy Ashford Highland 23

24 Highland Transaction - Price Per Key Comparison $300 Highland Purchase Price Per Key Comparison ($ Thousands) $250 $200 47% discount to recent peer acquisitions 35% discount to 2007 Highland purchase $150 $300 $100 $158 $244 $158 $50 $- Peer Purchase Avg to Current AHT Highland Purchase 2007 Highland Purchase AHT Highland Purchase Source: Real Capital Analytics & company filings. 24

25 Replacement Cost per Key $350,000 $300,000 Replacement Cost Per Key Estimate $281,000 Highland was purchased for $158,000 per key - a 44% discount to replacement cost $250,000 $200,000 $218,000 $233,000 $150,000 $100,000 $50,000 $- Source: Estimated based on JP Morgan Research Report Legacy AHT (20,340 Keys) Highland (5,799 Keys) Total (26,139 Keys) 25

26 Reinstated Dividend w/ Growth Potential Given the material reduction in our common share count, Ashford is well positioned to cover and potentially grow its dividend 5.0x 4.5x 4.0x 3.5x 3.0x 2.5x 2.0x 1.5x 1.0x 0.5x 0.0x 0.9x AFFO Per Share / Dividend Coverage 1.4x 1.4x 1.5x 1.6x 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 Q TTM26 N/A N/A 4.5x

27 Most Highly-Aligned Management Team 25% Insider Ownership % 20% 21% 16% 15% 10% 6% 5% 4% 3% 3% 2% 2% 1% 1% 1% 1% 0% Source: 2011 Proxy Filings AHT HT CLDT INN FCH HST PEB CHSP DRH SHO BEE LHO 27

28 Investor Presentation September 2011