Solid Quarter Highlighted by Announcement of Merger Agreement with Condor Hospitality Trust, Inc.
DALLAS and TORONTO, Aug. 28, 2019 /CNW/ -- NexPoint Hospitality Trust, ("NHT"1), (TSX-V: NHT.U) announced today the release of NHT's financial results for the three and six months ended June 30, 2019. Additionally, the board of trustees announced NHT's second quarterly distribution of $0.075 per outstanding trust unit ("Unit") payable to unitholders of NHT as of the record date September 30, 2019 on or about October 15, 2019. All amounts are expressed in U.S. dollars.
- On July 22, 2019, NHT announced an agreement to acquire Condor Hospitality Trust, Inc. (NYSE American: CDOR) ("Condor"). In line with NHT's growth strategy, NHT will acquire 15 select-service and extended stay hospitality properties. The transaction is expected to increase NHT's gross asset value to $700 million and is anticipated to close during the fourth quarter of 2019.
- For several reasons, we believe the acquisition of Condor will be immediately accretive. Additionally, the acquisition provides other benefits such as scale, geographic diversification, brand diversification, more exposure to extended stay assets with higher occupancy and more stable cash flows, and a newer portfolio with upside revenue growth potential as the Condor assets continue to move toward stabilization.
- For the three months ended June 30, 2019, NHT reported Net Loss, FFO2, Core FFO2 and AFFO2 of $(2.9) million, $.9 million, $2.5 million and $1.9 million, respectively, attributable to Unitholders.
- For the three months ended June 30, 2019, the portfolio averaged occupancy of 76.2%, Average Daily Rate of $153.45 and Revenue per Available Room of $116.95.
- For the three months ended June 30, 2019, the portfolio generated total revenues of $19.3 million, operating and general and administrative expenses of $11.4 million and NOI2 of $7.8 million, generating an NOI Margin2 of 40.6%.
- The board declared a distribution of $0.075 per Unit payable to Unitholders of record on September 30, 2019 with payment on or about October 15, 2019, representing a 45% Core FFO payout ratio2.
- Additional information on second quarter 2019 financial and operational results can be found at www.sedar.com in our quarterly consolidated interim financial statements and management discussion and & analysis ("MD&A").
"We continued to achieve our objectives in the second quarter posting strong revenue and CFFO growth as a result of our renovation strategy. We are extremely excited about the Condor acquisition as we believe it will provide several benefits to our existing portfolio and is immediately accretive," said chairman and chief executive officer, James Dondero.
NexPoint Hospitality Trust is a publicly traded real estate investment trust, with its Units listed on the TSX Venture Exchange under the ticker NHT.U. and NHT is focused on acquiring, owning and operating well-located hospitality properties in the United States that offer a high current yield and in many cases are underperforming assets with the potential to increase in value through investments in capital improvements, a market-based recovery, brand repositioning, revenue enhancements, operational improvements, expense inefficiencies, and exploiting excess land or underutilized space. NHT owns 11 branded properties sponsored by Marriott, Hilton and Intercontinental Hotels Group, located across the U.S. NHT is externally advised by NexPoint Real Estate Advisors VI, L.P., an affiliate of Highland Capital Management, L.P., a leading global alternative asset manager and an SEC-registered investment adviser.
Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
Certain statements in this press release may constitute "forward-looking" information that involves known and unknown risks, uncertainties and other factors, and it may cause actual results, performance or achievements or industry results, to be materially different from any future results, performance or achievements or industry results expressed or implied by such forward-looking information. Forward-looking information is identified by the use of terms and phrases such as "anticipate", "believe", "could", "estimate", "expect", "intend", "may", "plan", "predict", "project", "will", "would", and similar terms and phrases, including references to assumptions. In particular, the expectation that the acquisition of Condor will be completed, the timing for the closing, and the expected benefits of the acquisition including NHT's gross asset value following closing of the acquisition constitute forward-looking statements.
Forward-looking information contained in this press release is based on certain key expectations and assumptions made by NHT, including, without limitation, expectations that the closing conditions of the Condor acquisition will be satisfied and the acquisition will close, assumptions respecting the amount of the expected monthly cash distributions and the timing to pay such cash distributions to unitholders, and a reasonably stable North American economy and stock market. Although the forward-looking information contained in this press release is based upon what the NHT's management believes to be reasonable assumptions, NHT cannot assure investors that actual results will be consistent with such information. Forward-looking information reflects current expectations of management regarding future events and operating performance as of the date of this press release. Such information involves significant risks and uncertainties, should not be read as guarantees of future performance or results, and will not necessarily be accurate indications of whether or not such results will be achieved. A number of factors could cause actual results to differ materially from the results discussed in the forward-looking information, and a description of these factors can be found under "Risk Factors" in NHT's final prospectus dated March 27, 2019 and Management's Discussion and Analysis dated August 27, 2019, which are available on SEDAR (www.sedar.com).
The forward-looking information contained herein is expressly qualified in its entirety by this cautionary statement. Forward-looking information reflects management's current beliefs and is based on information currently available to NHT. The forward-looking information is made as of the date of this press release and NHT assumes no obligation to update or revise such information to reflect new events or circumstances, except as may be required by applicable law.
1 In this release, "we," "us," "our," and "NHT" each refer to NexPoint Hospitality Trust.
2 FFO, Core FFO, AFFO NOI, NOI Margin Debt to Gross Real Estate Value Ratio and Core FFO payout ratio are non-IFRS measures. See "Non-IFRS Financial Measures" in our MD&A for definitions of each of these measures and a reconciliation of these measures to Net Income.
SOURCE NexPoint Hospitality Trust, Inc.