Q2 2024 Ashford Hospitality Trust Inc Earnings Call Transcript
Key Points
- Ashford Hospitality Trust Inc (AHT) made significant progress in its strategy to pay off strategic corporate financing, with nearly $90 million in principal payments made since March.
- The company successfully sold seven assets for more than $310 million, with six sales closing in the second quarter, contributing to debt reduction.
- AHT completed a key refinancing of the Renaissance Nashville loan, securing a new nonrecourse loan of $267.2 million with favorable terms.
- The non-traded preferred stock offering raised approximately $147 million in gross proceeds, providing attractive capital for the company.
- The company's urban hotels performed well, with total revenue increasing by 3% and hotel EBITDA margin increasing by 160 basis points compared to the prior year quarter.
- AHT does not anticipate reinstating a common dividend in 2024, which may be a concern for income-focused investors.
- The company is experiencing some softness in its resort hotels, which are down high single digits compared to last year.
- The transaction environment remains challenging with a wide bid-ask spread, affecting asset sales and valuations.
- The refinancing market has been unattractive, causing delays in refinancing efforts, although improvements are expected in the second half of the year.
- The company faces challenges in selling lower RevPAR, lower quality assets, and is waiting for better market conditions to pursue these sales.
Hello, and welcome to the Ashford Hospitality Trust second quarter 2024 results conference call. (Operator Instructions) I would now like to turn the conference over to Deric Eubanks, Chief Financial Officer. You may begin.
Good day, everyone, and welcome to today's conference call to review results for Ashford Hospitality Trust for the second quarter of 2024, and update you on recent developments. On the call today will also be Stephen Zsigray, President and Chief Executive Officer, and Chris Nixon, Executive Vice President and Head of Asset Management.
The results as well as notice of the accessibility of this conference call on a listen only basis over the Internet were distributed yesterday afternoon in a press release. At this time, let me remind you that certain statements and assumptions in this conference call contain or are based upon forward-looking information and are being made pursuant to the safe harbor provisions of the federal securities regulations. Such forward-looking statements
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