AINC - Earnings call 3 2023

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Operator

Good afternoon. My name is Jordan, and I'll be your conference operator today. At this time, I'd like to welcome everyone to the Ashford Inc. Results Conference Call. [Operator Instructions] Jordan Jennings, Director of Investor Relations, you may begin your conference.

Jordan Jennings

to the call and third you recent welcome for review to and on for Ashford quarter developments. day, today's to conference results update Good of XXXX

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

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

certain accessed the X-K of may www.ashfordinc.com. through and tables used or Form which November non-GAAP which In schedules, be company's on are addition, release on website reconciliations terms with accompanying and the in been X, at are measures, also the financial call this earnings provided in SEC have company's XXXX, filed

with other unless discussed the third this stated, quarter September earnings the XXXX. in Also, all reported release XXXX, ended review compare ended the to encouraged information these otherwise listener Each provided reconciliations call quarter XX, release. the together in all XX, September provided third results in with is

to the turn now over call Deric. I'll

Deric Eubanks

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

The are: quarter, to perform reported over the the continued revenue And for industry lodging highlight has today first, key to going things well. portfolio most our prior at we companies. of we're the growth of year

been negatively resume have margins more as our businesses levels. However, normalized our impacted staffing

through million since we approximately Second, to pace Ashford see raised capital continue of raising and of an XXXX. in launch $XXX have attractive capital Securities its

update on in estate platform, types is we're to investment in Growth on an Texas. advice private vehicle And Strategic Strategic our investing the Texas third, newest provide commercial of all Fund excited Texas The focused Fund. a Growth real

to both and as see continue to group strengthen. some interest nicely XX,XXX corporate of hotels now assets. Braemar, portfolio Braemar's travel more Trust its and ownership approximately X REIT and demand guests As publicly Ashford recover had to platforms, urban stabilization for in XXX XXXX, approximately options with demand have pricing as while Resort continues and continues billion $X.X rooms hotels leisure both September traded XX, our in of gross

We To of Ashford its quarter issued for source an continues the of preferred attractive with ended believe that $XXX of its focus maturities its has is balance working and net $XX million Trust sheet capital approximately this and on extending to capital. million Ashford platform. deleveraging nontraded date, stock. Trust

Tribute Louisiana also to in in property brand New early planned announced Portfolio Crowne Autograph Marriott Ashford Le conversion XXXX, West, part and Concha La property, in Collection Hotel of the Florida family. Marriott Trust a to a the the planned Key recently Plaza of Orleans, its the conversion of Hotel Pavillon

diversified unlock portfolio. embedded announcements these how of quality, Trust can geographically illustrate in high Ashford Both value its

preferred on Ashford financing, and capital through upcoming its off asset and continues select nontraded corporate to raising offering. Trust debt through paying maturities refinancing focus extending stock primarily sales, its

Our We this newest raised in and with Antonio, the Fund, made advised platform million outside an is year. in recently to property equity from late Texas along in fund which investment $X.X that a capital, launched Strategic multifamily other make used which Texas. Growth we capital a investors, investment last San

growth. Our are strategy structure and designed for

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

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

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

income the was turn EBITDA Adjusted third now was will common for third I for for quarter. million. to Net results $XX.X net to $XX our stockholders the loss third quarter. the Adjusted for fee quarter X.X% the $X.XX. attributable financial per million $X.X prior year the over revenue quarter share advisory net increased adjusted was diluted Braemar and from quarter. income was quarter third Total million in the

X.X which outstanding, plan, comprised deferred common restricted issuance Series for shares discuss Our million currently common at share shares operating fully over businesses shares compensation earmarked stands to convertible now turn our million our outstanding, common of diluted call X.X Eric more preferred and shares associated the million million in count million of shares stock and detail. the our our is to X.X under shares with stock. X.X acquisition-related I'll D remaining X.X

Eric Batis

you, Thank Deric.

provide quarter and updates excited businesses. are our on services third products We to

best our businesses our exceptional executing utilizing shareholder these operating practices, acquisitions and add-on acquire businesses and to is accretive value ability strategy refer advised by create to Our unique REITs. implementing to

top quarter, over and than products businesses the with quarter. the revenue performance, In XX% businesses services greater strong the X year achieving third posted line growth prior

our quarters. in for gains, businesses market particularly share with clients to expenses look are we excited recurring We future as about optimize these

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

dynamic the third Resorts. a $XX.X the Remington EBITDA The year million new margin best-in-class seasonality, in due Remington X management lower-margin INSPIRE outperforming XXX pandemic compared has which hotel margin the operating. Remington incentive the were properties but management quarter hotels third are quarter, the budget due year and to executed prior XX.X% quarter third management revenue Trust adjusted an representing Remington's and Hotels annual to properties XXXX a increase quarter and due and management historically in company, continued to elevated & pleased also the fees, decreased advised margin. managed of is respectively, million, quarter for At providing is we Braemar Ashford's ancillary Hospitality revenue. to for fee revenues growth. lower open hotel expertise throughout recovery. the Remington $X.X third agreements to quarter, REITs, and with Ashford $X.X third-party the management were and XX of representing adjusted across that managed the hotel million of end hotels In EBITDA revenue of country. lowest generated Remington

groups managed These managed ownership more ownership X manage properties of developers. the also across boutique funds, Caribbean different offices, expansion which in states and XX hotels. or Remington market. and XX of including groups Remington XX Washington, hired and individuals, announced their private properties. third-party XX for family portfolio XX into high estate equity include worth have Remington's XX groups, week, operates this brands, independent Remington its net Earlier to real D.C.

Costa and Rica, X Remington begun the the with managing forward property its Remington's X and Republic. contract is company Rica signed marking to in updates Resort future in Hospitality Dominican The We additional region. on Costa Crocs portfolio in calls. first look has international in providing broadening additional Casino

the and and to level over provider the a revenue the EBITDA. activities Virgin a third of quarter, revenue and Leisure Florida services is market, Keys Turks of of the RED & less RED demand has destination Puerto representing passenger from $X.X and In to Hospitality million Islands, year RED Keys, Caicos increase see continued generated adjusted watersports U.S. $X.X causing Rico, million peak incremental in XX.X% high-margin prior post-COVID quarter Florida off captured. be leading its in Hawaii.

of by Nui August in demand as demand tourism market. the Earlier RED's the XXXX and significantly strategic XXXX. Maui normalizes. a back this operations were wildfires to Hawaii in recovers expects RED the foothold ramp in acquired Alii early up through establishing end and Maui Maui Hawaii, into Shop year, The in XXXX RED impacted Dive and

impacted Our hearts the to out by go tragedy. people this

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

contracts, project Premier new its development, streams. to general plans quarter, opportunities X Premier architecture diversify of and $X.X grow third-party to the fee further design representing revenue. executed contracting, million ground-up During revenue expected

raised efforts. approximately Through Ashford the with million $XXX of pleased XXXX. very capital of has third are quarter, We the fundraising Securities ongoing since Ashford success Securities

offering, both capital. is for offering Ashford currently Since approximately Ashford stock source and nontraded placed preferred to institutional Trust has in an the Securities continued sheet its RIA balance improve growing broker-dealer Ashford the potential attractive Ashford momentum Securities for market our has to of and of growth. a $XX.X redeemable launch and preferred of nontraded Trust Ashford capital relationships. million for is the This by Trust with stock build

on is raising growth-oriented in estate Securities commercial a Ashford for focused real product also investment Texas. capital

Ashford the to over XX million quarter, Ashford signed capital, Securities of investment dealer with distribute end product. an the As this $X.X by including third $X.X firms agreements raised Inc. of and million of has of

third its acquisition. Fund quarter, the the made during first Additionally,

and We across now concludes meaningfully acquisitions, through will growing we we portfolio prepared while and two remarks, continue our continue open to sales companies. strategic That initiatives: our opportunities primary up maintain on scale Q&A. call a our to products to and platform for the focus third-party pursue services all

Operator

Tyler comes of question Your line Oppenheimer. from first the Batory from

Jonathan Jenkins

Tyler. for on Jonathan is This

one for me. First

line Is that pause you does seasonality think the now. still have might right reason? this within that's slow own pretty given be you it are viewpoint, you here feel there trend the the normalization gives November? and going given in I difficult of businesses that out kind at But pretty healthy variety unique you a on of and or seeing all there anything

Deric Eubanks

perspective, our chip I'll well. from as well. general, to Eric may perform the Deric, I industry, there want in is lodging -- to information This in. I Look, continues some add think

on on as ramp-up we've As we've talked the COVID. continues demand other strong to transient, seen leisure this where corporate side both demand we calls, had about normalization is mentioned the business from extreme groups where after and side, you demand in be

and well, in overseas negatively still performance well resorts, properties and leisure was Keys travel go going options we more that And and impact having folks levels said performing elsewhere And the leisure. leisure impacted more resort and cruises in a on et travelers the the leisure focused previous and that, lot of are Caribbean saw when markets that having that concentrated year, that those But cetera. Florida above more this couldn't XXXX, of overseas. and of are

that saw -- staffed not is of we've we normalized growth those was margins from on lot last our the we So have yet, impact because those were not that of And And revenue perspective, margins as were when some the of view not where we we Demand businesses seen a didn't the to as that but benefit coming guess, back I up. it in. staffing we strong our level is sustainable was revenues leisure continue at businesses year have knew a fully had we were those to expected. not was a industry performing because some, lodging really strong, be the well.

as that's We've some companies. our grow labor of at and one so the levels are we portfolio revenues our staffing situation continue pressure as been challenges normalized. And to more our margin seen

in. chime Eric let I'll that, with So

Eric Batis

Jonathan, hiring some kind in "slowing" if would our to add decisions is Yes. ], the only that any longer we of is only thing the taking folks say portfolio to it's sign that that the they're biggest of when make cases, see I'd [ companies. I'd any

to close the seen what just our So bit in a longer bit. is business time years prior hesitating a with we've little people than

add to I made by you all that still. business It's people Premier, However, stopping. are Remington, putting as the down with completely and comments tell INSPIRE, pencils not were can continuing that overcoming if

other mentioned. only the add Deric beyond what that's color I'd So

Jonathan Jenkins

there. And on comments color on out the to Appreciate well? to Great. normalized off are in you some segue and I you've left [indiscernible] provide the as additional color levels maybe Any many labor. Okay. positions Deric's color how of then staffing there general? labor the return environment that on Can more the seen to fill? mean

Eric Batis

sure. Yes,

number to staffing in levels, can addition a it's So to significantly. pretty tell, of As things, normalized growing you right? we're returning also revenue different

so we to that as growth growth And continue. for staff expect are up and continuing that to we well,

of normal the is will, levels. fill. outstanding we some we're dying point think at kind profitability soon begin the have positions I what a a of more certainly, We lot growth. you're capturing of combination here that of to -- staffing seeing from So to more don't up still revenue But

you I continue. it's hourly to then much we for achieving significant of increasing normalized labor portfolio as numbers into and planning and now But next companies. the year getting continue don't staffing. have growth are kind that for for expecting to at the revenue Wages still specific of

unit So but of of we're there. theme your inflation per other answers with the I that's of some cost are the don't And the expenses kind experiencing. of some kind know higher and that course, our of question, that labor if of

Jonathan Jenkins

and growth commentary Okay. how broader the in Remington, opportunity any term internationally? then in Understood. switching the at to And the Remington thinking Caribbean And expansion maybe about gears the longer high-level for you're Caribbean? on

Eric Batis

companies of Yes. markets. managing we'll market it We've are of grow. we next area. opportunity to a a growth on see have terms that But more specifically lot some mean those dedicated in this in as we not of resources number have in an quarter number as managing area I that a where probably. the lot of competitive There's to people got

identify And for there, us so success. effort to Miami opportunities recently a and we've some early concerted we're having go office, established and it's down

So we I additional added that expect we're that we've continue X in I accelerate remarks the adding growth I mentioned now, contracts do and to to that -- in to expect area. addition we'll that as prepared my already in that don't X focus

Jonathan Jenkins

compared for us growth last me, could, of Okay. continues that And accelerate the kind your Ashford to on ramp expectations? And how I you there? Securities. then initial one for It if Can opportunity remind nicely. further maybe to has

Deric Eubanks

Look, been ramp-up we've happy very the I'll that. capital in Yes, take with raising.

of I raise across think if and industry you million look $XXX fantastic. that the been over it segment to amount being raise able in we've pretty that time to able is

investments So to be objectives up Look, management and Securities primary third-party Fund under business. those either raising capital under other to companies capital and our Texas hotel there. other happy as way two manage then cetera. Growth management assets we're our a other assets, the our grow with Strategic our we can in in our are asset into view We and acquisitions, portfolio grow assets like ramp grow put types that, able like into our primary potentially to by very et that Ashford property deploying and investments to that

open So AHT. growth is will for be nontraded for pretty success We've And for we X I That Braemar the $XX prospects than approximately Securities think raised had with years. significant. million now our offering a more preferred Ashford offering. great more

run We're room the out of there's Fund. the private right now So Strategic with offering. Growth market still in Texas called to fund plenty on this that

to could other sell are products other Ashford advised assets and there platforms. have management Securities grow potentially our we under through And that

under and something we what but about excited us the potential very we'll down and there, about see grow be help kind to thinking we to that's pike constantly of so assets comes are And about, Securities the for continue talking that Ashford management. our

Operator

[Operator call. conference Instructions] today's This concludes

You conference may now This concludes call. today's disconnect.

Ashford (AINC) 9 Nov 232023 Q3 Earnings call transcript