May 2019
Forward Looking Statements and Non-GAAP Measures 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 or debt amount. A capitalization rate is determined by dividing the property's net operating income by the purchase price. Net operating income is the property's funds from operations minus a capital expense reserve of either 4% or 5% of gross revenues. Hotel EBITDA flow-through is the change in Hotel EBITDA divided by the change in total revenues. To calculate EBITDA for real estate, or EBITDAre, as defined by NAREIT we exclude impairment on real estate, gain/loss on sale of hotel properties and the Company’s portion of EBITDAre of OpenKey from EBITDA . We further adjust EBITDAre to exclude certain additional items such as uninsured hurricane and wildfire related costs, write-off of loan costs and exit fees, other income/expense, transaction, and management conversion costs, legal, advisory and settlement costs, software implementation costs, and non-cash items such as amortization of unfavorable contract liabilities, gain /loss on insurance settlements, non- cash stock/unit-based compensation, unrealized gains/losses on investments, and derivative instruments, as well as our portion of adjustments to EBITDAre of unconsolidated entities, this is Adjusted EBITDAre. We present EBITDA, EBITDAre and Adjusted EBITDAre because we believe they reflect more accurately the ongoing performance of our hotel assets and other investments and provide more useful information to investors as they are indicators of our ability to meet our future debt payment requirements, working capital requirements and they provide an overall evaluation of our financial condition. EBITDA, EBITDAre and Adjusted EBITDAre as calculated by us may not be comparable to EBITDA, EBITDAre and Adjusted EBITDAre reported by other companies that do not define EBITDA, EBITDAre and Adjusted EBITDAre exactly as we define the terms. EBITDA, EBITDAre and Adjusted EBITDAre do not represent cash generated from operating activities determined in accordance with GAAP, and should not be considered as an alternative to operating income or net income determined in accordance with GAAP as an indicator of performance or as an alternative to cash flows from operating activities as determined by GAAP as an indicator of liquidity. EBITDA, EBITDAre, Adjusted EBITDAre, FFO, AFFO, CAD and other terms are non-GAAP measures, reconciliations of which have been provided in prior earnings releases, filings with the SEC or in the appendix to this presentation. 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 Braemar Hotels & Resorts Inc. or any of its respective affiliates, and may not be relied upon in connection with the purchase or sale of any such security. 2 Company Presentation // May 2019
Management Team R ICHARD J. S TOCKTON J EREMY J. W ELTER D ERIC S. E UBANKS , CFA Chief Executive Officer & Chief Operating Officer Chief Financial Officer President 14 years of hospitality 21 years of hospitality 19 years of hospitality experience experience experience 9 years with the Company (5 2 years with the Company 16 years with the Company years with the Company’s 15 years with Morgan Stanley 3 years with ClubCorp predecessor) Cornell School of Hotel CFA charterholder 5 years with Stephens Administration, BS Southern Methodist University Investment Bank University of Pennsylvania BBA Oklahoma State University BS MBA 3 Company Presentation // May 2019
Strategic Overview Focused strategy of investing in luxury hotels and resorts Bardessono Hotel & Spa Yountville, CA Grow organically through strong revenue and cost control initiatives Grow externally through accretive acquisitions of high quality assets Pier House Resort Key West, FL Targets conservative leverage of Net Debt / Gross Assets of 45% with non-recourse property debt The Ritz-Carlton St. Thomas St. Thomas, USVI Highly-aligned management team and advisory structure 4 Company Presentation // May 2019
2019 Q1 Hotel Operating Results Comparable Hotel Operating Results (1) 2019 Q1 2018 Q1 % Variance ADR $ 321.54 $ 303.56 5.9% Occupancy 75.5% 77.7% (2.8)% RevPAR $ 242.75 $ 235.74 3.0% RevPAR (not under renovation) (2) $ 263.13 $ 256.42 2.6% Total Hotel Revenue (3) $ 130,697 $ 127,305 2.7% Hotel EBITDA (3) $ 40,433 $ 40,660 (0.6)% Hotel EBITDA Margin 30.9% 31.9% (1.0)% C OMPARABLE R EV PAR (4) C OMPARABLE H OTEL EBITDA (4) $245 $150 $144.5 $233 $235 $145 $226 $225 $140 $219 $136.7 (In millions) $215 $135 $207 $205 $130 $199 $126.9 $123.3 $195 $125 $121.1 $185 $120 $175 $115 2015 2016 2017 2018 2019 Q1 2015 2016 2017 2018 2019 Q1 TTM TTM (1) Includes: Bardessono, Hotel Yountville, Ritz-Carlton St. Thomas, Pier House, Marriott Seattle Waterfront, Capital Hilton, Sofitel Chicago, Hilton Torrey Pines, Courtyard San Francisco, Courtyard Philadelphia, Park Hyatt Beaver Creek, Ritz-Carlton Lake Tahoe and Ritz-Carlton Sarasota (2) Excludes: Courtyard Philadelphia, Courtyard San Francisco, and St. Thomas Ritz-Carlton (3) In thousands (4) As reported in Earnings Releases: 2015, as reported on 2/25/2016; 2016 as reported on 2/22/2017; 2017 as reported on 2/28/2018; 2018 as reported on 2/27/2019; 2019 Q1 TTM as reported on 5/1/2019 5 Company Presentation // May 2019
2019 Q1 Highlights and Results Quarter Highlights During the quarter, the Company entered into a $50 million Enhanced Return Funding Program • agreement with Ashford Inc. During the quarter, the Company completed the acquisition of the 170-room Ritz-Carlton Lake • Tahoe in Truckee, California. During the quarter, the Company refinanced a mortgage loan on two hotels with a new loan • totaling $195 million. The Company announced the planned opening of The Notary Hotel, an Autograph Collection • property, in downtown Philadelphia. The re-branded property, a conversion of the Courtyard Philadelphia Downtown, is expected to officially launch in early summer 2019. Capex invested during the quarter was $36.6 million. • Full Year Highlights A DJUSTED EBITDA RE AFFO PER S HARE Q UARTERLY D IVIDEND PER S HARE $130 $2.00 $0.80 $123.9 $125 $119.3 $120 $1.60 $0.34 $0.31 $0.15 $115 $111.1 $0.20 $0.16 $0.16 $109.1 (In millions) $110 $1.20 $0.34 $0.38 $0.37 $0.42 $105 $0.40 $0.12 $0.16 $0.16 $100 $0.80 $95.1 $0.56 $0.10 $0.50 $0.60 $0.12 $95 $0.16 $0.16 $0.62 $0.10 $90 $0.40 $0.12 $85 $0.10 $0.46 $0.46 $0.44 $0.39 $0.16 $0.16 $0.16 $0.26 $0.10 $0.05 $80 $0.00 $0.00 2015 2016 2017 2018 2019 Q1 2015 2016 2017 2018 2019 2015 2016 2017 2018 2019 TTM 6 Company Presentation // May 2019
Recent Developments January 2019 Q1 2019 Update We recently acquired the 170-room Ritz-Carlton Lake RevPAR (2) : $381 Hotel EBITDA (2) : $ 9.6M Tahoe, in Truckee, California for $120 million Quarterly RevPAR Quarterly Hotel EBITDA growth (3) : 32.8% growth (3) : 42.0% RevPAR (1) : $371 Meets Defined Strategy Further diversifies the portfolio while increases overall portfolio RevPAR Property is in excellent physical condition with limited capex needs Property Financial Overview (1) Hotel EBITDA of $9.2 million Hotel Net Operating Income of $7.4 million (1) TTM at the time of acquisition 7 (2) TTM as of March 31, 2019 Company Presentation // May 2019 (3) As of March 31, 2019
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