Ashford Hospitality Trust Inc

Stephen Z. Gray, 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 are subject to numerous assumptions, uncertainties, and known or unknown risks, which could cause actual results to differ materially from those anticipated. These factors are more fully disclosed 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 this call, and the company is not obligated to publicly update or revise them. Statements made during this call do not constitute an offer to sell or a solicitation of an offer to buy any securities. Securities will be offered only by means of a registration statement and prospectus, which can be found at www.sec.gov. 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 accompanying tables or schedules which have been filed on Form 8 with the SEC on November 5, 2024 and may also be accessed through the company's website at www.ahtREIT.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 third quarter ended September 30, 2024 with the third quarter ended September 30, 2023. I will now turn the call over to Steven Ziegreich. Please go ahead.

Good morning and welcome to our call. After my introductory comments, Derek will review our third quarter financial results and then Chris will provide an operational update on our portfolio. I'll begin by reiterating how pleased I am with the significant progress that we've made executing on our plan to pay off our strategic financing. We announced this plan back in January, and since then, we've done exactly what we said we would do. We've sold over $310 million of hotels. We've completed a refinancing of our Renaissance Nashville that generated significant excess proceeds, and we've now raised approximately $173 million of gross proceeds from the sale of our non-traded preferred stock. We've used some of the proceeds from each of these efforts to pay down our strategic financing by more than $100 million since the beginning of the year to approximately $82 million today. Additionally, we announced this morning that we've agreed to an amendment to the strategic financing. This amendment provides the company with an opportunity for a discounted exit fee if the financing is fully paid off by December 15th, provided that the outstanding balance has been reduced to $50 million or less by next Friday, November 15th. We are currently working on a couple of transactions that we hope will close in the near term, and we continue to believe we have a viable path to paying off this financing entirely before the end of the year. Operationally, in light of underwhelming revenue growth across the lodging industry through the first three quarters, our property managers are aggressively driving sales and managing expenses. We are pleased to announce that October saw our highest monthly top line growth of any month this year, with REVPAR growth of 4.6% versus October 2023. We believe we will also begin to see the benefits of additional expense management initiatives in the fourth quarter and more fully throughout 2025. We are also excited about the imminent conversions at our La Concha Hotel in Key West and Le Pavillon Hotel in New Orleans, as well as our newest addition to the portfolio, the Le Meridian Fort Worth Downtown. Regarding the La Concha Hotel in Key West, we are on track to convert this hotel by the end of the year to Marriott's autograph collection. Upon conversion, it will be rebranded to Autograph La Concha, and we are creating a distinctive theme and style for the hotel that is commensurate with the upper-upscale luxury autograph product. This includes transforming the lobby, bar, and restaurant, as well as upgrading the exterior, guest rooms, guest bathrooms, corridors, pool, and meeting space. Ideally located in Old Town Key West, the transformation is expected to elevate the property into a desirable niche in the high barrier to entry, high rev par Key West market. Post-conversion, we believe the new autograph property should realize a 20% to 30% rev par premium compared to pre-conversion. We're also on track to convert our Le Pavillon Hotel in New Orleans to Marriott's tribute portfolio by the end of 2024. This up branding includes renovations to guest rooms, guest bathrooms, restaurant, lobby bar, as well as extensive exterior work. Located in historic Poydras Street, it is a prime location in proximity to major demand generators in downtown New Orleans. Post-conversion, we believe the new tribute portfolio property should realize a 10% to 20% rev par premium compared to pre-conversion. Additionally, we have also recently opened the La Meridian Fort Worth downtown, following a redevelopment of the 13-story historic building. Situated in downtown Fort Worth, the 188-room hotel is located within easy walking distance of the Fort Worth Convention Center and close to local landmarks such as Trinity Park and Sundance Square. The property features a rooftop lounge, French-inspired cuisine, over 5,000 square feet of function space, and floor-to-ceiling windows designed to offer scenic views of the city's downtown. It's a great addition to our portfolio, it's already running well ahead of expectations, and we're very excited about the prospects for this property. As we look forward, completing the repayment of our strategic financing will allow the company to finally turn the page on the COVID era. As mentioned, we are keenly focused on maximizing the performance, profitability, and value of our hotels. Perhaps equally importantly, the company's advisor, Ashford, Inc., has also provided an unwavering commitment to substantially improve the profitability of Ashford Hospitality Trust over the coming year through corporate cost reductions, strategic portfolio turnover, and continued deleveraging. We will have more information to share regarding those efforts in the coming months, And we are excited about the future of the company, especially given increasingly attractive industry fundamentals, several coming years of limited supply growth, and improving transaction and financing markets. I will now turn the call over to Derek to review our third quarter financial performance.

Thanks, Stephen. For the third quarter, we reported a net loss attributable to common stockholders of $63.2 million, or $12.39 per diluted share. For the quarter, we reported AFFO per diluted share of negative $1.71. Adjusted EBITDA RE for the quarter was $52.4 million. At the end of the third quarter, we had $2.7 billion of loans with a blended average interest rate of 8%, taking into account in the money interest rate caps. Considering the current level of SOFR and the corresponding interest rate caps, approximately 83% of our debt is now effectively fixed and 17% is effectively floating. We ended the quarter with cash and cash equivalents of $119.7 million and restricted cash of $114.3 million. The vast majority of that restricted cash is comprised of lender and manager-held reserve accounts and $2.4 million related to trapped cash held by lenders. At the end of the quarter, we also had $26.7 million due from third-party hotel managers. This primarily represents cash held by one of our property managers, which is also available to fund hotel operating costs. We ended the quarter with networking capital of approximately $160 million. As of September 30, 2024, our consolidated portfolio consisted of 73 hotels with 17,644 rooms. After taking into account our recently completed 1 for 10 reverse stock split, Our share count at the end of the quarter consisted of approximately 5.6 million fully diluted shares outstanding, which is comprised of 5.4 million shares of common stock and 0.2 million OP units. While we are currently paying our preferred dividends quarterly or monthly, we do not anticipate reinstating a common dividend in 2024. This concludes our financial review, and I would now like to turn it over to Chris to discuss our asset management activities for the quarter. Thank you, Derek.