On November 5, 2024, Ashford Hospitality Trust Inc (AHT, Financial) released its 8-K filing detailing the financial results for the third quarter ended September 30, 2024. Ashford Hospitality Trust Inc is a real estate investment trust (REIT) that focuses on upscale and upper-upscale hotel properties across the U.S., operating under well-known brands such as Marriott, Hilton, and Hyatt.
Performance Overview
The company reported a net loss attributable to common stockholders of $63.2 million, or $12.39 per diluted share, missing the analyst estimate of -$3.50 per share. Revenue for the quarter was $276.6 million, exceeding the estimated $268.97 million. The decrease in revenue was primarily due to a 1.4% decline in Comparable Revenue Per Available Room (RevPAR) to $133, driven by a 3.0% decrease in Comparable Occupancy, despite a 1.7% increase in Comparable Average Daily Rate (ADR).
Financial Achievements and Challenges
Ashford Hospitality Trust Inc's Adjusted EBITDAre for the quarter was $52.4 million, and Adjusted Funds from Operations (AFFO) was reported at $(1.71) per diluted share. The company ended the quarter with cash and cash equivalents of $119.7 million and restricted cash of $114.3 million. The company's strategic plan to pay off its financing by January 2026 involves asset sales, mortgage debt refinancings, and raising non-traded preferred capital.
“I’m very pleased with the progress we have made related to our plan announced earlier this year to pay off our strategic financing,” commented Stephen Zsigray, Ashford Trust’s President and Chief Executive Officer.
Key Financial Metrics
From the balance sheet, Ashford Hospitality Trust Inc reported total assets of $3.27 billion, with total liabilities amounting to $3.36 billion, resulting in a total equity deficit of $271.6 million. The company has total loans of $2.7 billion with a blended average interest rate of 8.0%, with 83% of the debt effectively fixed.
| Metric | Q3 2024 | Q3 2023 |
|---|---|---|
| Net Loss Attributable to Common Stockholders | $(63.2) million | $(68.6) million |
| Adjusted EBITDAre | $52.4 million | $82.5 million |
| Adjusted FFO per Diluted Share | $(1.71) | $0.81 |
Analysis and Outlook
The company's performance reflects ongoing challenges in the hospitality sector, particularly in maintaining occupancy rates. The strategic initiatives to convert properties and raise capital through non-traded preferred stock are crucial for improving financial stability. The upcoming conversions of La Concha and Le Pavillon to Marriott brands are expected to enhance financial performance.
Despite the current challenges, Ashford Hospitality Trust Inc's focus on asset management and strategic refinancing could position it for better performance in the future. Investors will be keenly watching the company's ability to execute its strategic plans and improve its financial metrics in the coming quarters.
Explore the complete 8-K earnings release (here) from Ashford Hospitality Trust Inc for further details.
