Earnings call transcript Q4 2022

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Operator

Greetings and welcome to the Ashford Inc. Fourth Quarter 2022 Results Conference Call. [Operator Instructions] As a reminder, this conference is being recorded. It is now my pleasure to introduce your host, Jordan Jennings, Investor Relations. Thank you. ahead. go Please

Jordan Jennings

and results everyone full today’s call recent conference XXXX Good Ashford welcome for review developments. on you for to and the to and day, update to fourth year quarter

release. be will Executive Internet a as listen-only call Batis, of notice today call the President a distributed the Deric Chief yesterday of and Vice as Financial results The the on accessibility basis were Eubanks, in Operations. of over Eric Officer; well press conference On this

included time, remind call numerous and or cause results is or factors These known information The me this provisions filings the those to call, Securities to assumptions federal and the regulations. in pursuant company date and are of which of are risks, forward-looking of are publicly this unknown the obligated statements more statements this At that from differ Commission. certain Harbor securities made Such let company’s actual revise you discussed upon in the only them. uncertainties made being this contain or with in the and could to forward-looking assumptions, anticipated. Exchange and Safe update the subject as not to statements conference conference are call materially fully based are forward-looking

quarter together release. discussed quarter in other otherwise Each provided all been be in www.ashfordinc.com. website have addition, fourth and XXXX. XX, may Also, with company’s fourth call all XX, and the results which earnings XXXX, provided this encouraged is information used full the measures, year review ended accompanying accessed listener December to SEC reconciliations on December call the provided or XXXX, on this in through the company’s which ended full reported the with with stated, and certain compare the schedules, are the XX, terms reconciliations release In are unless year Form also non-GAAP at of in in earnings February financial those tables release X-K and filed

turn the will I over call Deric. to now

Deric Eubanks

and welcome strategy XXXX. will by the I up our to financial our discuss overview our then quarter, operating we operations, results results After regarding fourth that, morning, start Good call and it giving for provide Q&A. an for to you quarter of the and our will open an of will for financial update businesses. Eric

positioned. themes of and industry we lodging key momentum today first, going gain continues REIT recovery The are our highlight in both to are: to are well advised the platforms the

And our our to growth strong placing of stock, in Second, raising the focus million. pace capital We management, the for preferred we continue for completed operating recently initiative Braemar’s our accelerate. third-party on nontraded results offering Securities Ashford $XXX assets continues our to at see businesses. third, approximately growing efforts through under

XX, As had December traded assets had XXXX, XXX Ashford Hotels publicly in and Braemar $X.X gross of our rooms two hotels XX, & Resorts, as REIT ownership approximately XX,XXX December platforms, with of XXXX. and of Hospitality billion approximately Trust interest

anticipate completed Puerto that will the in two to Ritz-Carlton Resort iconic in acquisitions investment Reserve North. Scottsdale Braemar We at continue is quarter, Beach of several for Rico its strong to in compared the Four has ramp the accretive XX-room Dorado XXXX, results to look acquisition have to with the quarter Braemar segment hotel active While Seasons capital and actively the fueled performance fourth now, significantly. strong two Troon XXX-room quarters report the XXXX seen to deploy we Braemar to quarters, in Braemar’s up exposure continues XXXX. resorts into on and front XX% hotels RevPAR opportunities. in its last compared the fourth urban up

million $XXX accelerate and and now ago balance raising has is its delevered to with significantly capital. anticipate stock of Braemar’s we completed. offering net The sheet ended effective working from a years Trust few with the offering capital its non-traded over Ashford for quarter preferred

we future strategic ahead, have Looking believe objectives. both their focused we on advisory and ample platforms liquidity, remain

and growth. structure are designed strategy Our for

powerful we management. grow as of a ecosystem assets that businesses all have We benefit under our

Our in brands. as and major hospitality of for are the we structure potential also are is and believe to excited superior unique brings strategy have the size We space, within the and of one growth and scale other third-party and our fee capital about lodging payers owners benefits owners providers industry a we the the we that largest hotel platform.

businesses, accretively the grow to operating and numerous for bolt-on our we past we look acquisitions few completed attractive to business. have continue our for opportunities Over years, and strategically

of full XX% now year will common million $XX.X over for the full quarter. and stockholders was was million the the was for attributable $XX.X million $XX.X rate growth attributable Net for the XXXX. year million. a for to year. our Adjusted for stockholders to to and quarter quarter fourth I net loss fourth turn common the result reflected EBITDA loss financial $XX.X full results This

$X.XX, share Our $XX.X growth strong income income adjusted were growth the Premier. $XX.X by strong adjusted for per diluted income Adjusted net for million the Remington net XXXX was driven over reflecting and was year prior and and INSPIRE, fourth year. $X.XX. respectively, year, million the share primarily EBITDA adjusted income in for net Adjusted and net the quarter full per was

fees and recognized investors to Trust that deferred we want been million previous that in advisory quarters. base analysts had $X.X in remind the fourth quarter from XXXX, Ashford of I of

as comparison, to important So think in that it’s year-over-year the mind. you keep about

prior increased XX% revenue advisory the year fourth fee Total from the Braemar in quarter. quarter over

at stands stock, are outstanding, currently X.X for acquisition-related and deferred plan, shares shares common D million count issuance shares and under our is shares common common convertible Series with share X.X compensation X.X million which associated stock. X shares the preferred X comprised outstanding, of for earmarked shares million million restricted our diluted million remaining fully Our

more businesses I detail. will operating to now turn Eric in our the to call over discuss

Eric Batis

Deric. you, Thank

quarter set record Hospitality year. and revenue portfolio another XXXX. in a reached Remington out records our to of broke updates Services Products and company Several excited to EBITDA, our & We’re provide companies RED all-time which for a and year. that XXXX and round highs on maintain businesses, we INSPIRE revenue believe posted company excellent set momentum platform in beyond. for record and the carry and poised a the capital our company incredible XXXX We for success to into established Leisure Ashford raised is record within forward the Securities

in investment the infrastructure execution to through a best As a growth aim the division Products of strategy & we value reminder, of accretive acquisitions. hospitality where our industry, is create and investment Services and shareholder accelerate in implementation unique practices, operating the

relationships to exceptional businesses that financial ensuring We their advised our are these also receive and able hotels to utilize REITs, while extensive optimizing service refer our performance.

of prior are executed contracts adjusted INSPIRE event segment its during revenue. the with INSPIRE quarter, integrated growth adjusted The the the discuss meeting services, quarter, suite leading like quarter, revenue a XX.X% audiovisual our show to revenue hospitality which the INSPIRE, expected over generating million fourth of six quarter, of EBITDA, XX.X% XX.X% in fourth an and margin. first event, prior including audiovisual business a and $X.X solution for million services. significant services and realized million a new increase annual increase quarter. year in representing event EBITDA is hospitality of over contribute also year needs INSPIRE creative $XX.X $X in and to I’d fourth of generated million the single-source $X.X

$XXX.X generating audiovisual the and EBITDA EBITDA XX.X% to adjusted million XX company INSPIRE’s year, new record XXXX. The X% a XXXX expected million segment revenue. revenue margin of representing culminated its XXXX. million $XX.X with Dominican of Republic, adjusted XXXX, annual hospitality in of million compared compared signed Mexico in for also $XX.X in drove INSPIRE revenue in representing contracts to million in $XX of significant growth and the $XX.X Internationally,

the has XXXX made to INSPIRE’s and the with thrilled capture share. company are efforts We record-setting market

dynamic generated EBITDA prior fee hotels the quarter. company, and and hotel $XX.X providing margin. respectively, fee best-in-class a and revenue XX.X% the is reflects Hotel year adjusted respectively. of impressive EBITDA expertise grew management management million over This and fourth and Remington adjusted revenue million, Remington quarter XX.X% management management country. $X.X across an XX.X%, to hotel

that of growing XXX and on contracts was business fees. third-party hotel At open fourth hotels management were its across fourth base the Trust management brands, million including XX located managed and independent X of first Braemar, year in to continues $X.X awarded XX expected end properties. Remington the in and quarter, and the totaling focus for operating, properties agreements for XX XX XX Washington, boutique D.C., under third-party and Ashford Remington quarter, and states full

margin. EBITDA development, management generated design, the adjusted like discuss comprehensive cost-effective I’d generated project resulting services. of $X.X representing $X.X and Premier, XX.X% the a revenue Premier EBITDA, in prior of business million year architecture, and next over in The growth quarter. XX.X% fourth procurement which is quarter, adjusted fee provides also million to Premier

record multifamily for In hospitality, which were fee third-party the sales a for quarter, to addition, total property of $X.X new million Premier that type. and that were of executed XX raises total nine contracts the during XX projects, Six quarter on the contracts for in company’s property front which to new expected type contracts contracts three contracts the representing the for company. the revenue, brings

customers. third-party Across the XX gain from to representing multifamily, of hospitality is delivering Premier to revenue. design significant Repeat ownership and has contracts, by signed $XX.X continues portion of segments, excellent Premier’s groups, trust total of revenues million business its of third-party spanning a fee Premier a expected and the XX student housing service completion

Leisure Caicos. adjusted Key over $X.X Islands, Hospitality provider of with a of and Rico, XX.X% generated and revenue of fourth and the bookings, enters prior quarter. EBITDA year the the travel $X Puerto other and Virgin is leading Turks activities In $X.X West the the billion of RED in sports RED water RED quarter, adjusted quarter of X.X% increase U.S. representing services EBITDA, advanced margin. an million first million XXXX and

for entry as company signals the trajectory seeks the growth from sports services, entire experience. excursion gain customer the company’s water demand and an recent coupled into revenue with exciting to Strong transportation,

to to continues to gain continue in opportunities scale. markets market explore existing new and grow share RED M&A Additionally, and

in made Ashford fundraising XXXX. Securities, progress platform, our dedicated tremendous

Ashford of great a and We approximately investment $XXX Since total a professionals offerings. XX million talented what of have has who are in to placed out new at do. generate continues they built team interest inception, Securities

investments has recently a growth-oriented Ashford Securities private and Texas. that Ashford core estate the for Hospitality commercial real state stock offerings, non-traded investment of launched an Trust new offering preferred income-focused targets in offering two

investment hospitality Securities’ the outside Ashford is of first offering growth-oriented industry. offering The focused

are because wealth companies bullish real into Star We of migration market Lone on state. of the estate continued the very Texas people, and commercial

as very are prospects Securities significantly head to of to be strategy an management. grow part about our excited view under into We our XXXX assets and Ashford we platform integral this

businesses two major our on and sales hospitality acquisitions look we through we executing industry the recovery will to platform. for initiatives: ahead, and As strategic focus growing continue our in products third-party services the our and

of all the opportunity portfolio all businesses in of runway significant our see our and to scale continue across We companies. to meaningfully see

That and our concludes up remarks, the Q&A. prepared now open call we for will

Operator

Maher is Thank you. question Securities. Bryan The ahead. Instructions] go coming [Operator of Please Riley B. first from

Bryan Maher

afternoon. I the Good appreciate comments.

Just post-COVID. it there? rebounded Dominican important hear surprised comes Republic. few I mean, sourcing me. big of you clearly, a that Who’s driving acquisitions part strength business date an your to a and that are and little one to Mexico been for to INSPIRE, in your the it I see When how that’s was business? about opportunity And new of do most growth? nicely How you

Eric Batis

relationships. Yes, specifically very for building Dominican there that plus been XX have years that the leaders Republic, have just markets in two are those we consistently in Mexico and focused

we’re to property joined the to have a He CEO Chuck industry. good international on continues sales our also one from hospitality the who Bauman, and of as We used manage that business competitors. It’s company of it for base grow. largest building just

relationships about Republic. to hospitality he well has able so we’re been are leverage in in and of that the we’ve And talking some Mexico that these as contracts Dominican

hospitality those and nice So located meaningfully. target large into on the about out clients, to is think give looking the we’re that the some there and would new Caribbean. expand that Republic think too, do also at revenues. know how with Dominican being don’t we but into areas for that, And creates of you being Rico just continue to to I the we new we that so Puerto a Dominican, Mexico near-term number can ability jump we in with is I look that try can grow to those other other in the have a we part specifically and we potentially the areas, of at opportunity

shows able amount So number we’ve also, to expect of recovered achieve you that and groups of I them. market or for sales so the travel share of market companies great we think that Mexico been those travel big growth put hosting corporate that take with you people bit that indicative say, A total and do don’t have size out down Dominican to in benefits that but those are lot we a exciting, getting it’s and their etcetera, recovery big I XXXX. terms and a is there. meaningfully that of capture, agree markets the would shows I’ll it’s for that teams, on in for to for I Republic,

So I indicative was a markets. in think there it’s that recovery pretty that, significant those

Bryan Maher

might seen dovetail it at you par. Okay. there have in some can little of that of and to some the of that, give M&A the of then you the Do slowed what color seemed a think just Thanks. But likely was – us to back be it I opportunity? of we’ve moving kind like maybe XXXX, forget something there there? on of the might an necessarily along weakness And I half with a other else bit going RED, the luxury Hurricane little to or was. due want more RED resort and name at aberration lines wouldn’t Fiona bit on the

Eric Batis

the quarters you’re QX add. and can a a pandemic Yes. recovered more materially in to are Caribbean lot than right? folks’ RED so Islands quickly of as travel businesses, I slowdown. Florida of presence to took any they for other grow and other its versus I’d are said, seeing Virgin and it’s of But with where ability being our That we have QX quicker going the from responded of thing RED slower to timing mean think we to still expect to and historically grow the very U.S. recover us, some contracts the a markets. INSPIRE that RED longest we

expect Virgin – have up growth coming we with year Islands U.S. some the contracts. significant We new in this

don’t And indication certainly, slowdown and there think you’re a to that like an a so it and I mentioning, I need a It’s don’t us QX is to thing markets. the think that attribute there hits is you QX. of activity weather in seasonal

significantly. see grow particular don’t expect RED it and to as I I concern, So any of

trail kind when impact In have so of and and of of and other terms we are in mitigate acquisitions, into that South do Florida. some would that the events that couple, hot we Caribbean geographies will a grow to believe on weather can of love do we the the we we

So the acquisitions think make be on RED I here. will to track term near some that are in exciting

Bryan Maher

questions. Just more last have for I me, two

the that Securities the of there traded raise. secondarily, that Ashford then the for On preferred is size traded Trust how Ashford us some untraded non-preferred in are there, surprised think I success non-traded Ashford of a related? like Might other the raise be? fairly by pays – amount money And entities Braemar raise, might aren’t

Deric Eubanks

that. take it’s Hey, Deric. I’ll Bryan,

offering. So to question a answer raise, Ashford your million the $XXX it’s on Trust

open offering X X.X and before it be the got as the in we sidetracked the opened that, to filed hit shelf a know, the The then kind of And same, industry it. close was got finally during we offering. COVID. size it prior for they then about So we time except you will offering, early. years for It the happened And of years that’s by COVID, shelved on had hotel for we we the perspectives could then it off we only little what because initially that while. kind Braemar the if the left right of the amount or

life those registration finite of them. to have kind statements And so a

months for $XXX million. as were or said, about so, you we there raised So XX out

And amount. started. we’re we’re getting very pleased with and AHT, at up, just ramping just offering We’re that

got we to will dealers raise. are transition sort And it’s to with broker So were Trust we those will worked where that ultimately of syndicate end Ashford with of we’ve up. hard really know over We’ve we now great working and that a lot involved obviously, them a of groups Braemar, the with. and

we raising of groups, other your for that’s question terms second about could clearly In capital do. something

sure that perspective, from do, us. be want something just it’s would for think smart I be would make we that something to profitable it’s would our to

something say something the is very kind it they So us soon, pleased in the really always great with And really wouldn’t up. from together just – is team, to not park it sure for the put hit prepared anytime as of potential a that he’s of out organization that offering. that set Steigerwald really do Jay I’m said We I and like their expect has first started with scratch. should but we that we’re remarks, us. you a And

we and up they be and that group in top well that more So performers ramped clearly, couldn’t pleased have I with think how space.

pleased that. with very very, So

Bryan Maher

for That’s And thank you. me. all

Operator

Thank thank interest like to you. Hospitality. us This in brings the end of session. We’d you question-and-answer for the Ashford your to

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Ashford (AINC) 23 Feb 232022 Q4 Earnings call transcript