Ashford Hospitality Trust Inc

Greetings. Welcome to Ashford Hospitality Trust's first quarter 2021 results conference call. At this time, all participants are in a listen-only mode. A question and answer session will follow the formal presentation. If anyone should require operator assistance during the conference, please press star zero on your telephone keypad. Please note this conference is being recorded. I will now turn the conference over to Jordan Jennings, Investor Relations for Ashford Hospitality. Thank you. You may begin.

Good day, everyone, and welcome to today's conference call to review the results for Ashford Hospitality Trust for the first quarter of 2021 and to update you on recent developments. On the call today will be Rob Hayes, President and Chief Executive Officer, Derek Eubanks, Chief Financial Officer, and Jeremy Walter, Chief Operating Officer. 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 are subject to numerous assumptions, uncertainties, and known or unknown risk, which could cause actual results to differ materially from those anticipated. These factors are more fully discussed in the company's filings with the Securities and Exchange Commission. The forward-looking statements included in this conference call are only made as of the date of the call, and the company is not obligated to publicly update or revise them. In addition, certain terms used in this call are non-GAAP financial measures, reconciliations of which are provided in the company's earnings release and the company's tables or schedules. which have been filed on Form 8K with the SEC on May 4th, 2021, and may also be accessed through the company's website at www.ahtreet.com. Each listener is encouraged to review those reconciliations provided in the earnings release together with all other information provided in the release. Also, unless otherwise stated, all reported results discussed in this call compare the first quarter of 2021 with the first quarter of 2020. I will now turn the call over to Rob Hayes. Please go ahead, sir.

Good morning, and welcome to our call. I'll start by providing an overview of the current environment and how Ashford Trust has been navigating the recovery. After that, Derek will review our financial results, and Jeremy will provide an operational update on the portfolio. First, I'd like to highlight some of our recent accomplishments and the main themes for our call. First, we had strong earnings in the first quarter that exceeded both street estimates and our internal budgets. We reported positive hotel EBITDA for the quarter for the first time since the first quarter of 2020. Second, early in the quarter, we secured a $200 million strategic financing with additional future commitments of up to $250 million to provide multiple years of liquidity for the company. Third, we have delivered our balance sheet by over half a billion dollars during the past 12 months. And lastly, even with an already attractive loan maturity schedule, we have successfully modified property loan extension tests on two large pools for 2023 and 2024, as well as another large loan pool for 2024 and 2025, making it easier for us to qualify for those extension options. This loan modification initiative will continue to be a focus for us going forward. There have been numerous positive developments for both our company and the hospitality industry over the past few months. We highlighted many of them in an updated investor deck that we put out in early April. We encourage you to review that deck. It is available on our website. As it relates to our liquidity, and as we mentioned on our last call, in January we completed a crucial strategic financing. We drew $200 million at the closing of the financing and have the option to draw an additional $250 million if needed. At this time, we are hopeful that we may not need to draw any remaining funds from that facility, but that will likely depend on the ongoing strength and trajectory of the industry recovery. Investors should also remember that effectively all of our hotel loans are currently in cash traps, and it may be some time before those loans allow us the ability to pull cash from the properties to corporate. We are optimistic about the long-term outlook for the company. And by taking decisive actions to strengthen our balance sheet with this strategic financing and other steps we've taken, we now have multiple years of runway that will allow us to capitalize on recovery we are seeing in the hospitality industry. We have significantly reduced our planned spend for capital expenditures this year. However, given the sizable strategic capital expenditures we made in our properties over the past several years, we believe our hotels are in fantastic condition and are well positioned for the industry rebound. To further improve our liquidity profile, we have suspended both our common and preferred dividends, and Derek will provide more detail around our liquidity outlook. Let me now turn to the operating performance at our hotels. The lodging industry is clearly showing signs of improvement. We are very encouraged by the development and deployment of vaccines in the U.S. and hope that we will continue to see progress from that front. And while our hotels continue to have negative operating income in January and February, our hotels performed well in March. enough so that Ashford Trust had positive net operating income for the quarter. The second quarter looks to be building upon that strong March, as April numbers look likely to exceed March numbers. So we are confident that the industry recovery is finally taking hold. We believe our geographically diverse portfolio, consisting of high-quality, well-located assets across the U.S. that are approximately 80% reliant on transient demand, will be in a position to capitalize on the pent-up leisure and building transient corporate demand we are seeing. We continue to be focused on aggressive cost control initiatives, working closely with our property managers to minimize cost structures and maximize liquidity at the hotels. This is where our relationship with our affiliated property manager, Remington, really sets us apart. Remington was able to quickly cut costs and rapidly adjust to the new operating environment. In the same way that they were hyper responsive on the way down, we expect them to be hyper responsive on the way up, mitigating cost creep as much as possible throughout the recovery. We are proud of their efforts over the past year and believe this important relationship has enabled us to outperform the industry from an operations standpoint. And Jeremy will discuss this in more detail. The past 12 months have been extraordinary by any measure, and I could not be prouder of the effort and the performance of our teams during this challenge. Our management team has extensive experience in navigating tough market environments, and we believe we have the right plan in place to capitalize on the recovery as it unfolds. This plan includes continuing to maximize liquidity across the company, optimizing the operating performance of our assets as they recover, delivering the balance sheet over time, and looking for opportunities to invest and grow as we bounce off the trough of the industry cycle. We will be laser focused on all of these. I'll now turn the call over to Derek to review our first quarter financial performance.