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Ashford Reports Third Quarter 2017 Results

DALLAS, Nov. 2, 2017 /PRNewswire/ -- Ashford Inc. (NYSE American: AINC) (the "Company") today reported the following results and performance measures for the third quarter ended September 30, 2017. Unless otherwise stated, all reported results compare the third quarter ended September 30, 2017, with the third quarter ended September 30, 2016 (see discussion below). The reconciliation of non-GAAP financial measures is included in the financial tables accompanying this press release.

STRATEGIC OVERVIEW

  • High-growth, fee-based, low-capex business model
  • Diversified platform of multiple fee generators
  • Seeks to grow in three primary areas:
    • Expanding the existing platforms accretively and accelerating performance to earn incentive fees
    • Starting new platforms for additional base and incentive fees
    • Investing in or incubating strategic businesses that can achieve accelerated growth through doing business with our existing platforms and by leveraging our deep knowledge and extensive relationships within the hospitality sector
  • Highly-aligned management team with superior long-term track record
  • Leader in asset and investment management for the real estate & hospitality sectors

FINANCIAL AND OPERATING HIGHLIGHTS

  • Net loss attributable to the Company for the third quarter of 2017 totaled $1.9 million, or $1.05 per diluted share, compared with a net loss of $0.3 million, or $0.49 per diluted share, in the prior year quarter. Adjusted net income for the third quarter was $3.8 million, or $1.65 per diluted share, compared with $2.7 million, or $1.17 per diluted share, in the prior year quarter, reflecting a growth rate of 44% and 41%, respectively.
  • Total revenue for the third quarter of 2017 was $19.3 million
  • Adjusted EBITDA for the third quarter was $4.5 million, reflecting a growth rate of 38% over the prior year quarter
  • At the end of the third quarter of 2017, the Company had approximately $6.4 billion of assets under management
  • As of September 30, 2017, the Company had corporate cash of $43.0 million

INVESTMENT IN J&S AUDIO VISUAL
On November 1, 2017, the Company acquired an 85% controlling interest in a privately held company that conducts the business of J&S Audio Visual in the United States, Mexico, and the Dominican Republic ("J&S") for approximately $9.2 million in cash, $4.3 million of Ashford common stock, and $9.5 million in assumed debt (excluding transaction costs, working capital adjustments, and contingent consideration).

J&S provides an integrated suite of audio visual services, including show & event services, hospitality services, creative services, and design & integration, making J&S a leading single-source solution for their clients' meeting and event needs. J&S currently has multi-year contracts in place with approximately 55 hotels and convention centers in addition to regular business representing over 2,500 annual events and productions, 500 venue locations, and 650 clients. J&S currently has contracts in place with only two hotels owned by Ashford's advised REIT platforms.

PURE ROOMS UPDATE
In April 2017, the Company acquired a 70% controlling interest in Pure Rooms. Pure Rooms is a leading provider of hypo-allergenic hotel rooms in the United States. Pure Rooms utilizes state-of-the-art purification technology to create allergy-friendly guestrooms. Pure Rooms' hypo-allergenic rooms are designed to provide a better night's sleep for all guests, especially allergy sufferers. Pure Rooms' patented 7-step purification process treats a room's surfaces, including the air, and removes up to 99% of pollutants. Pure Rooms currently has contracts in place with 163 hotels (approximately 2,500 rooms) throughout the United States, including 42 hotels owned by Ashford's advised REIT platforms. Revenues for the company have increased 41% year-to-date through the third quarter versus the prior year period.

OPENKEY UPDATE
Ashford currently owns a 44% interest in OpenKey. OpenKey is the universal, industry-standard smartphone App for keyless entry in hotel guestrooms. There have been several recent developments regarding OpenKey's growth. First, deployments of their technology are quickly ramping up and are expected to reach an estimated 20,000 rooms deployed and an estimated 35,000 rooms under contract over the next 12-18 months. Additionally, sales demonstrations and signed contracts are at an all-time high with the third quarter surpassing the record-setting second quarter. In the third quarter, total revenues increased 80% compared to the second quarter 2017 and 167% compared to the third quarter last year.

FINANCIAL RESULTS
Net loss attributable to the Company for the third quarter of 2017 totaled $1.9 million, or $1.05 per diluted share, compared with a net loss of $0.3 million, or $0.49 per diluted share, for the third quarter of 2016. Adjusted net income for the third quarter of 2017 was $3.8 million, or $1.65 per diluted share, compared with $2.7 million, or $1.17 per diluted share, in the prior year quarter, reflecting a growth rate of 44% and 41%, respectively.

For purposes of calculating non-GAAP metrics for the quarter, the Company has added back $1.1 million of compensation expenses relating to the first and second quarter.

For the third quarter ended September 30, 2017, base advisory fee revenue was $10.9 million, including $8.6 million from Ashford Hospitality Trust, Inc. (NYSE: AHT) ("Ashford Trust" or "Trust") and $2.3 million from Ashford Hospitality Prime, Inc. (NYSE: AHP) ("Ashford Prime" or "Prime").

Adjusted EBITDA for the third quarter of 2017 was $4.5 million, compared with $3.2 million for the third quarter of 2016, reflecting a growth rate of 38%.

CAPITAL STRUCTURE
At the end of the third quarter of 2017, the Company had approximately $6.4 billion of assets under management from its managed companies, corporate cash of $43.0 million, no corporate level debt, no preferred equity, and 2.2 million fully diluted shares. The Company has a current fully diluted equity market capitalization of approximately $158 million.

QUARTERLY HIGHLIGHTS FOR ADVISED PLATFORMS

ASHFORD TRUST HIGHLIGHTS

  • Trust completed an underwritten public offering of 3,800,000 shares of 7.50% Series H Cumulative Preferred Stock at $25.00 per share.
  • Trust redeemed all of its issued and outstanding shares of 8.55% Series A Cumulative Preferred Stock and 1,564,353 shares of its 8.45% Series D Cumulative Preferred Stock.
  • Subsequent to quarter end, Trust redeemed an additional 379,036 shares of its 8.45% Series D Cumulative Preferred Stock.
  • Subsequent to quarter end, Trust refinanced a mortgage loan, secured by the Hilton Boston Back Bay, with an existing outstanding balance totaling approximately $95 million, with a new loan totaling $97 million.
  • Subsequent to quarter end, Trust refinanced a mortgage loan, secured by 17 hotels, with an existing outstanding balance totaling approximately $413 million, with a new loan totaling $427 million. The new loan is expected to result in annual interest savings of approximately $9.8 million.

ASHFORD PRIME HIGHLIGHTS

  • Prime refinanced a mortgage loan, secured by the Bardessono Hotel & Spa, with an existing outstanding balance totaling approximately $40 million, with a new loan totaling $40 million. The new loan is expected to result in annual interest savings of approximately $1 million.
  • Subsequent to quarter end, Prime announced plans to convert its Courtyard San Francisco Downtown hotel to an Autograph Collection property.
  • Subsequent to quarter end, Prime announced that it had completed the sale of its Marriott Plano Legacy hotel in Plano, Texas and is marketing for sale its Renaissance Tampa hotel in Tampa, FL.

"We are pleased with our operating results for the quarter and the continued execution on our growth strategy including closing our investment in J&S," commented Monty J. Bennett, Ashford's Chairman and Chief Executive Officer. "We remain solely focused on maximizing value for our shareholders and are well positioned to opportunistically grow our business by accretively expanding our existing REIT platforms, adding additional investment platforms and investing in other hospitality-related businesses through which we can accelerate meaningful, profitable growth."

INVESTOR CONFERENCE CALL AND SIMULCAST
The Company will conduct a conference call on Friday, November 3, 2017, at 12:00 p.m. ET. The number to call for this interactive teleconference is (719) 457-2620. A replay of the conference call will be available through Friday, November 10, 2017, by dialing (719) 457-0820 and entering the confirmation number, 9031876.

The Company will also provide an online simulcast and rebroadcast of its third quarter 2017 earnings release conference call. The live broadcast of the Company's quarterly conference call will be available online at the Company's web site, www.ashfordinc.com on Friday, November 3, 2017, beginning at 12:00 p.m. ET. The online replay will follow shortly after the call and continue for approximately one year.

Included in this press release are certain supplemental measures of performance which are not measures of operating performance under GAAP, to assist investors in evaluating the Company's historical or future financial performance. These supplemental measures include adjusted earnings before interest, tax, depreciation and amortization ("Adjusted EBITDA") and Adjusted Net Income. We believe that Adjusted EBITDA and Adjusted Net Income provide investors and management with a meaningful indicator of operating performance. Management also uses Adjusted EBITDA and Adjusted Net Income, among other measures, to evaluate profitability and our board of directors includes these measures in reviews to determine quarterly distributions to stockholders. We calculate Adjusted EBITDA by subtracting or adding to net income (loss): interest expense, income taxes, depreciation, amortization, net income (loss) to noncontrolling interests, transaction costs, and other expenses. We calculate Adjusted Net Income by subtracting or adding to net income (loss): net income (loss) to noncontrolling interests, transaction costs, and other expenses. Our methodology for calculating Adjusted EBITDA and Adjusted Net Income may differ from the methodologies used by other comparable companies, when calculating the same or similar supplemental financial measures and may not be comparable with these companies. Neither Adjusted EBITDA nor Adjusted Net Income represents cash generated from operating activities as determined by GAAP and should not be considered as an alternative to a) GAAP net income (loss) as an indication of our financial performance or b) GAAP cash flows from operating activities as a measure of our liquidity nor are such measures indicative of funds available to satisfy our cash needs. The Company urges investors to carefully review the U.S. GAAP financial information as shown in our periodic reports on Form 10-Q and Form 10-K, as amended.

* * * * *

Ashford provides global asset management, investment management and related services to the real estate and hospitality sectors.

Follow Chairman and CEO Monty Bennett on Twitter at www.twitter.com/MBennettAshford or @MBennettAshford.

Ashford has created an Ashford App for the hospitality REIT investor community. The Ashford App is available for free download at Apple's App Store and the Google Play Store by searching "Ashford."

Forward Looking Statements

Certain statements and assumptions in this press release contain or are based upon "forward-looking" information and are being made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. These forward-looking statements are subject to risks and uncertainties. When we use the words "will likely result," "may," "anticipate," "estimate," "should," "expect," "believe," "intend," or similar expressions, we intend to identify forward-looking statements. Such statements are subject to numerous assumptions and uncertainties, many of which are outside Ashford's control.

These forward-looking statements are subject to known and unknown risks and uncertainties, which could cause actual results to differ materially from those anticipated, including, without limitation: general volatility of the capital markets and the market price of our common stock; changes in our business or investment strategy; availability, terms and deployment of capital; availability of qualified personnel; changes in our industry and the market in which we operate, interest rates or the general economy; the degree and nature of our competition; risks that Ashford will ultimately not pursue a transaction with Remington or Remington will reject engaging in any transaction with Ashford; if a transaction is negotiated between Ashford and Remington, risks related to Ashford's ability to complete the acquisition on the proposed terms; the possibility that competing offers will be made; risks associated with business combination transactions, such as the risk that the businesses will not be integrated successfully, that such integration may be more difficult, time-consuming or costly than expected or that the expected benefits of the acquisition will not be realized; risks related to future opportunities and plans for the combined company, including uncertainty of the expected financial performance and results of the combined company following completion of the proposed acquisition; disruption from the proposed acquisition, making it more difficult to conduct business as usual or maintain relationships with customers, employees, managers or franchisors; and the possibility that if the combined company does not achieve the perceived benefits of the proposed acquisition as rapidly or to the extent anticipated by financial analysts or investors, the market price of Ashford's shares could decline. These and other risk factors are more fully discussed in Ashford's filings with the Securities and Exchange Commission.

The forward-looking statements included in this press release are only made as of the date of this press release. Investors should not place undue reliance on these forward-looking statements. We are not obligated to publicly update or revise any forward-looking statements, whether as a result of new information, future events or circumstances, changes in expectations or otherwise.

ASHFORD INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(unaudited, in thousands, except share and per share amounts)



September 30, 2017


December 31, 2016

ASSETS




Current assets:




Cash and cash equivalents

$

44,561



$

84,091


Restricted cash

11,109



9,752


Investments in securities



91


Prepaid expenses and other

1,073



1,305


Receivables

518



16


Due from Ashford Trust OP

11,705



12,179


Due from Ashford Prime OP

1,065



3,817


Other assets

128




Total current assets

70,159



111,251


Investments in unconsolidated entities

500



500


Furniture, fixtures and equipment, net

11,753



12,044


Deferred tax assets

630



6,002


Goodwill

813




Intangible assets, net

157




Total assets

$

84,012



$

129,797


LIABILITIES AND EQUITY




Current liabilities:




Accounts payable and accrued expenses

$

12,059



$

11,314


Due to affiliate

2,071



933


Due to Ashford Prime OP from AQUA U.S. Fund



2,289


Deferred compensation plan

202



144


Notes payable

340




Other liabilities

11,109



9,752


Total current liabilities

25,781



24,432


Accrued expenses

68



287


Deferred income

11,488



4,515


Deferred compensation plan

12,397



8,934


Notes payable, net

20




Total liabilities

49,754



38,168






Redeemable noncontrolling interests

251



179


Redeemable noncontrolling interest in subsidiary common stock

1,685



1,301


Equity:




Preferred stock, $0.01 par value, 50,000,000 shares authorized:




Series A cumulative preferred stock, no shares issued and outstanding at September 30, 2017 and December 31, 2016




Common stock, $0.01 par value, 100,000,000 shares authorized, 2,022,403 and 2,015,589 shares issued and outstanding at September 30, 2017 and December 31, 2016, respectively

20



20


Additional paid-in capital

242,830



237,796


Accumulated deficit

(210,988)



(200,439)


Total stockholders' equity of the Company

31,862



37,377


Noncontrolling interests in consolidated entities

460



52,772


Total equity

32,322



90,149


Total liabilities and equity

$

84,012



$

129,797


ASHFORD INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(unaudited, in thousands, except per share amounts)



Three Months Ended


Nine Months Ended


September 30,


September 30,


2017


2016


2017


2016

REVENUE








Advisory services:








Base advisory fee

$

10,868



$

10,679



$

32,599



$

32,176


Incentive advisory fee

771



481



2,312



1,213


Reimbursable expenses

2,143



2,246



7,454



6,676


Non-cash stock/unit-based compensation

3,443



3,021



5,449



7,755


Other advisory revenue

132





146




Other

1,898



111



3,947



279


Total revenue

19,255



16,538



51,907



48,099


EXPENSES








Salaries and benefits

11,408



7,191



27,577



21,882


Non-cash stock/unit-based compensation

5,342



5,773



11,819



16,524


Depreciation and amortization

581



271



1,636



815


General and administrative

3,897



3,438



12,243



11,717


Impairment





1,072




Other

367





618




Total operating expenses

21,595



16,673



54,965



50,938


OPERATING INCOME (LOSS)

(2,340)



(135)



(3,058)



(2,839)


Realized gain (loss) on investment in unconsolidated entity







(3,601)


Unrealized gain (loss) on investment in unconsolidated entity







2,141


Interest expense and amortization of loan costs

(20)





(35)




Interest income

82



21



153



44


Dividend income



33



93



79


Unrealized gain (loss) on investments



287



203



1,182


Realized gain (loss) on investments



(728)



(294)



(7,071)


Other income (expense)

(5)



5



(26)



(144)


INCOME (LOSS) BEFORE INCOME TAXES

(2,283)



(517)



(2,964)



(10,209)


Income tax (expense) benefit

25



(575)



(9,248)



(560)


NET INCOME (LOSS)

(2,258)



(1,092)



(12,212)



(10,769)


(Income) loss from consolidated entities attributable to noncontrolling interests

102



486



267



6,852


Net (income) loss attributable to redeemable noncontrolling interests

4



(1)



4



6


Net (income) loss attributable to redeemable noncontrolling interest in subsidiary common stock

296



322



991



788


NET INCOME (LOSS) ATTRIBUTABLE TO THE COMPANY

$

(1,856)



$

(285)



$

(10,950)



$

(3,123)










INCOME (LOSS) PER SHARE - BASIC AND DILUTED








Basic:








Net income (loss) attributable to common stockholders

$

(0.92)



$

(0.14)



$

(5.42)



$

(1.55)


Weighted average common shares outstanding - basic

2,022



2,014



2,019



2,011


Diluted:








Net income (loss) attributable to common stockholders

$

(1.05)



$

(0.49)



$

(5.82)



$

(2.33)


Weighted average common shares outstanding - diluted

2,054



2,262



2,052



2,188



ASHFORD INC. AND SUBSIDIARIES
RECONCILIATION OF NET INCOME (LOSS) TO EBITDA AND ADJUSTED EBITDA
(unaudited, in thousands)



Three Months Ended


Nine Months Ended


September 30,


September 30,


2017


2016


2017


2016

Net income (loss)

$

(2,258)



$

(1,092)



$

(12,212)



$

(10,769)


(Income) loss from consolidated entities attributable to noncontrolling interests

102



486



267



6,852


Net (income) loss attributable to redeemable noncontrolling interests

4



(1)



4



6


Net (income) loss attributable to redeemable noncontrolling interest in subsidiary common stock

296



322



991



788


Net income (loss) attributable to the company

(1,856)



(285)



(10,950)



(3,123)


Interest expense and amortization of loan costs

12





21




Depreciation and amortization

574



267



1,617



802


Income tax expense (benefit)

(25)



575



9,248



560


Realized and unrealized (gain) loss on investment in unconsolidated entity (net of noncontrolling interest)







1,328


Net income (loss) attributable to redeemable noncontrolling interests

(4)



1



(4)



(6)


EBITDA

(1,299)



558



(68)



(439)


Equity-based compensation

1,893



2,753



6,348



8,769


Market change in deferred compensation plan

2,006



(494)



3,673



(1,178)


Transaction costs

483



310



2,313



1,180


Software implementation costs

54



49



148



954


Reimbursed software costs

(218)





(492)




Dead deal costs







63


Realized and unrealized (gain) loss on derivatives



56



41



103


Legal and settlement costs

323





478




Severance costs

88





170




Compensation adjustment

1,125








Adjusted EBITDA

$

4,455



$

3,232



$

12,611



$

9,452



ASHFORD INC. AND SUBSIDIARIES
RECONCILIATION OF NET INCOME (LOSS) TO ADJUSTED NET INCOME (LOSS)
(unaudited, in thousands, except per share amounts)



Three Months Ended


Nine Months Ended


September 30,


September 30,


2017


2016


2017


2016

Net income (loss)

$

(2,258)



$

(1,092)



$

(12,212)



$

(10,769)


(Income) loss from consolidated entities attributable to noncontrolling interests

102



486



267



6,852


Net (income) loss attributable to redeemable noncontrolling interests

4



(1)



4



6


Net (income) loss attributable to redeemable noncontrolling interest in subsidiary common stock

296



322



991



788


Net income (loss) attributable to the company

(1,856)



(285)



(10,950)



(3,123)


Depreciation and amortization

574



267



1,617



802


Net income (loss) attributable to redeemable noncontrolling interests

(4)



1



(4)



(6)


Equity-based compensation

1,893



2,753



6,348



8,769


Realized and unrealized (gain) loss on investment in unconsolidated entity (net of noncontrolling interest)







1,328


Market change in deferred compensation plan

2,006



(494)



3,673



(1,178)


Transaction costs

483



310



2,313



1,180


Software implementation costs

54



49



148



954


Reimbursed software costs

(218)





(492)




Dead deal costs







63


Realized and unrealized (gain) loss on derivatives



56



41



103


Legal and settlement costs

323





478




Restructuring income tax expense

(630)





7,803




Severance costs

88





170




Compensation adjustment

1,125








Adjusted net income (loss)

$

3,838



$

2,657



$

11,145



$

8,892


Adjusted net income (loss) per diluted share available to common stockholders

$

1.65



$

1.17



$

4.81



$

3.91


Weighted average diluted shares

2,322



2,277



2,316



2,276



ASHFORD INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS AND
RECONCILIATION OF NET INCOME (LOSS) TO EBITDA, ADJUSTED EBITDA AND ADJUSTED NET INCOME (LOSS) BY SEGMENT
(unaudited, in thousands, except per share amounts)



Three Months Ended September 30, 2017


Three Months Ended September 30, 2016


REIT Advisory


Hospitality Products & Services


Corporate/ Other


Ashford Inc. Consolidated


REIT Advisory


Hospitality Products & Services


Corporate/ Other


Ashford Inc. Consolidated

REVENUE
















Advisory services:
















Base advisory fee - Trust

$

8,568



$



$



$

8,568



$

8,576



$



$



$

8,576


Incentive advisory fee - Trust

452







452










Reimbursable expenses - Trust

1,673







1,673



1,515







1,515


Non-cash stock/unit-based compensation - Trust

4,392







4,392



1,887







1,887


Base advisory fee - Prime

2,300







2,300



2,103







2,103


Incentive advisory fee - Prime

319







319



481







481


Reimbursable expenses - Prime

470







470



731







731


Non-cash stock/unit-based compensation - Prime

(949)







(949)



1,134







1,134


Other advisory revenue - Prime

132







132










Other

998



900





1,898



84



27





111


Total revenue

18,355



900





19,255



16,511



27





16,538


EXPENSES
















Salaries and benefits



713



8,367



9,080





332



6,976



7,308


Market change in deferred compensation plan





2,006



2,006







(494)



(494)


REIT non-cash stock/unit-based compensation expense

3,443







3,443



3,021







3,021


AINC non-cash stock/unit-based compensation expense



11



1,888



1,899







2,753



2,753


Reimbursable expenses

2,143







2,143



2,246







2,246


General and administrative



427



1,649



2,076





333



1,235



1,568


Depreciation and amortization

185



22



374



581





6



265



271


Other



367





367










Total operating expenses

5,771



1,540



14,284



21,595



5,267



671



10,735



16,673


OPERATING INCOME (LOSS)

12,584



(640)



(14,284)



(2,340)



11,244



(644)



(10,735)



(135)


Other



(25)



82



57



(30)



(12)



(340)



(382)


INCOME (LOSS) BEFORE INCOME TAXES

12,584



(665)



(14,202)



(2,283)



11,214



(656)



(11,075)



(517)


Income tax (expense) benefit

(4,543)





4,568



25



(4,051)





3,476



(575)


NET INCOME (LOSS)

8,041



(665)



(9,634)



(2,258)



7,163



(656)



(7,599)



(1,092)


(Income) loss from consolidated entities attributable to noncontrolling interests



102





102





82



404



486


Net (income) loss attributable to redeemable noncontrolling interests



296



4



300





322



(1)



321


NET INCOME (LOSS) ATTRIBUTABLE TO THE COMPANY

$

8,041



$

(267)



$

(9,630)



$

(1,856)



$

7,163



$

(252)



$

(7,196)



$

(285)


Interest expense and amortization of loan costs



12





12










Depreciation and amortization

185



15



374



574







267



267


Income tax expense (benefit)

4,543





(4,568)



(25)



4,051





(3,476)



575


Net income (loss) attributable to redeemable noncontrolling interests





(4)



(4)







1



1


EBITDA

12,769



(240)



(13,828)



(1,299)



11,214



(252)



(10,404)



558


Equity-based compensation



5



1,888



1,893







2,753



2,753


Market change in deferred compensation plan





2,006



2,006







(494)



(494)


Transaction costs





483



483







310



310


Software implementation costs

53





1



54



49







49


Reimbursed software costs, net

(218)







(218)










Realized and unrealized (gain) loss on derivatives













56



56


Legal and settlement costs





323



323










Severance costs



88





88










Compensation adjustment





1,125



1,125










Adjusted EBITDA

12,604



(147)



(8,002)



4,455



11,263



(252)



(7,779)



3,232


Interest expense and amortization of loan costs



(12)





(12)










Income tax benefit (expense)

(4,543)





4,568



25



(4,051)





3,476



(575)


Restructuring income tax expense, net





(630)



(630)










Adjusted net income (loss)

$

8,061



$

(159)



$

(4,064)



$

3,838



$

7,212



$

(252)



$

(4,303)



$

2,657


Adjusted net income (loss) per diluted share available to common stockholders (1)

$

3.47



$

(0.07)



$

(1.75)



$

1.65



$

3.17



$

(0.11)



$

(1.89)



$

1.17


Weighted average diluted shares

2,322



2,322



2,322



2,322



2,277



2,277



2,277



2,277


________

(1)

The sum of the adjusted net income (loss) per diluted share available to common stockholders as calculated for the segments may differ from the consolidated total due to rounding.

ASHFORD INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS AND
RECONCILIATION OF NET INCOME (LOSS) TO EBITDA, ADJUSTED EBITDA AND ADJUSTED NET INCOME (LOSS) BY SEGMENT
(unaudited, in thousands, except per share amounts)



Nine Months Ended September 30, 2017


Nine Months Ended September 30, 2016


REIT Advisory


Hospitality Products & Services


Corporate/ Other


Ashford Inc. Consolidated


REIT Advisory


Hospitality Products & Services


Corporate/ Other


Ashford Inc. Consolidated

REVENUE
















Advisory services:
















Base advisory fee - Trust

$

26,020



$



$



$

26,020



$

25,842



$



$



$

25,842


Incentive advisory fee - Trust

1,356







1,356










Reimbursable expenses - Trust

5,902







5,902



4,641







4,641


Non-cash stock/unit-based compensation - Trust

7,748







7,748



4,535







4,535


Base advisory fee - Prime

6,579







6,579



6,334







6,334


Incentive advisory fee - Prime

956







956



1,213







1,213


Reimbursable expenses - Prime

1,552







1,552



2,035







2,035


Non-cash stock/unit-based compensation - Prime

(2,299)







(2,299)



3,220







3,220


Other advisory revenue - Prime

146







146










Other

2,349



1,598





3,947



252



27





279


Total revenue

50,309



1,598





51,907



48,072



27





48,099


EXPENSES
















Salaries and benefits



1,759



21,179



22,938





1,015



20,915



21,930


Market change in deferred compensation plan





3,673



3,673







(1,178)



(1,178)


REIT non-cash stock/unit-based compensation expense

5,449







5,449



7,755







7,755


AINC non-cash stock/unit-based compensation expense



27



6,343



6,370







8,769



8,769


Reimbursable expenses

7,454







7,454



6,676







6,676


General and administrative



1,565



4,190



5,755





1,052



5,119



6,171


Depreciation and amortization

438



50



1,148



1,636





17



798



815


Impairment

1,041





31



1,072










Other



618





618










Total operating expenses

14,382



4,019



36,564



54,965



14,431



2,084



34,423



50,938


OPERATING INCOME (LOSS)

35,927



(2,421)



(36,564)



(3,058)



33,641



(2,057)



(34,423)



(2,839)


Other

(309)



(47)



450



94



(75)



(31)



(7,264)



(7,370)


INCOME (LOSS) BEFORE INCOME TAXES

35,618



(2,468)



(36,114)



(2,964)



33,566



(2,088)



(41,687)



(10,209)


Income tax (expense) benefit

(12,895)





3,647



(9,248)



(12,133)





11,573



(560)


NET INCOME (LOSS)

22,723



(2,468)



(32,467)



(12,212)



21,433



(2,088)



(30,114)



(10,769)


(Income) loss from consolidated entities attributable to noncontrolling interests



413



(146)



267





684



6,168



6,852


Net (income) loss attributable to redeemable noncontrolling interests



991



4



995





788



6



794


NET INCOME (LOSS) ATTRIBUTABLE TO THE COMPANY

$

22,723



$

(1,064)



$

(32,609)



$

(10,950)



$

21,433



$

(616)



$

(23,940)



$

(3,123)


Interest expense and amortization of loan costs



21





21










Depreciation and amortization

438



31



1,148



1,617





4



798



802


Income tax expense (benefit)

12,895





(3,647)



9,248



12,133





(11,573)



560


Realized and unrealized (gain) loss on investment in unconsolidated entity (net of noncontrolling interest)













1,328



1,328


Net income (loss) attributable to redeemable noncontrolling interests





(4)



(4)







(6)



(6)


EBITDA

36,056



(1,012)



(35,112)



(68)



33,566



(612)



(33,393)



(439)


Equity-based compensation



5



6,343



6,348







8,769



8,769


Market change in deferred compensation plan





3,673



3,673







(1,178)



(1,178)


Transaction costs



167



2,146



2,313







1,180



1,180


Software implementation costs

144





4



148



927





27



954


Reimbursed software costs, net

(523)





31



(492)










Dead deal costs













63



63


Realized and unrealized (gain) loss on derivatives





41



41







103



103


Legal and settlement costs





478



478










Severance costs



88



82



170










Adjusted EBITDA

35,677



(752)



(22,314)



12,611



34,493



(612)



(24,429)



9,452


Interest expense and amortization of loan costs



(21)





(21)










Income tax benefit (expense)

(12,895)





3,647



(9,248)



(12,133)





11,573



(560)


Restructuring income tax expense, net





7,803



7,803










Adjusted net income (loss)

$

22,782



$

(773)



$

(10,864)



$

11,145



$

22,360



$

(612)



$

(12,856)



$

8,892


Adjusted net income (loss) per diluted share available to common stockholders (1)

$

9.84



$

(0.33)



$

(4.69)



$

4.81



$

9.82



$

(0.27)



$

(5.65)



$

3.91


Weighted average diluted shares

2,316



2,316



2,316



2,316



2,276



2,276



2,276



2,276


________

(1)

The sum of the adjusted net income (loss) per diluted share available to common stockholders as calculated for the segments may differ from the consolidated total due to rounding.

ASHFORD INC. AND SUBSIDIARIES
HOSPITALITY PRODUCTS & SERVICES
CONSOLIDATED STATEMENTS OF OPERATIONS AND
RECONCILIATION OF NET INCOME (LOSS) TO EBITDA, ADJUSTED EBITDA AND ADJUSTED NET INCOME (LOSS)
(unaudited, in thousands, except per share amounts)



Three Months Ended September 30, 2017


Three Months Ended September 30, 2016


Pure Rooms


OpenKey


Hospitality Products & Services


Pure Rooms


OpenKey


Hospitality Products & Services

REVENUE












Other

$

828



$

72



$

900



$



$

27



$

27


Total revenue

828



72



900





27



27


EXPENSES












Salaries and benefits

318



395



713





332



332


Equity based compensation



11



11








General and administrative

85



342



427





333



333


Depreciation and amortization

16



6



22





6



6


Other

341



26



367








Total operating expenses

760



780



1,540





671



671


OPERATING INCOME (LOSS)

68



(708)



(640)





(644)



(644)


Other

(10)



(15)



(25)





(12)



(12)


INCOME (LOSS) BEFORE INCOME TAXES

58



(723)



(665)





(656)



(656)


Income tax (expense) benefit












NET INCOME (LOSS)

58



(723)



(665)





(656)



(656)


(Income) loss from consolidated entities attributable to noncontrolling interests

(11)



113



102





82



82


Net (income) loss attributable to redeemable noncontrolling interests



296



296





322



322


NET INCOME (LOSS) ATTRIBUTABLE TO THE COMPANY

$

47



$

(314)



$

(267)



$



$

(252)



$

(252)


Interest expense and amortization of loan costs

7



5



12








Depreciation and amortization

11



4



15








EBITDA

65



(305)



(240)





(252)



(252)


Equity-based compensation



5



5








Transaction costs












Severance costs

88





88








Adjusted EBITDA

153



(300)



(147)





(252)



(252)


Interest expense and amortization of loan costs

(7)



(5)



(12)








Adjusted net income (loss)

$

146



$

(305)



$

(159)



$



$

(252)



$

(252)


Adjusted net income (loss) per diluted share available to common stockholders

$

0.06



$

(0.13)



$

(0.07)



$



$

(0.11)



$

(0.11)


Weighted average diluted shares

2,322



2,322



2,322



2,277



2,277



2,277



ASHFORD INC. AND SUBSIDIARIES
HOSPITALITY PRODUCTS & SERVICES
CONSOLIDATED STATEMENTS OF OPERATIONS AND
RECONCILIATION OF NET INCOME (LOSS) TO EBITDA, ADJUSTED EBITDA AND ADJUSTED NET INCOME (LOSS)
(unaudited, in thousands, except per share amounts)



Nine Months Ended September 30, 2017


Nine Months Ended September 30, 2016


Pure Rooms


OpenKey


Hospitality Products & Services


Pure Rooms


OpenKey


Hospitality Products & Services

REVENUE












Other

$

1,458



$

140



$

1,598



$



$

27



$

27


Total revenue

1,458



140



1,598





27



27


EXPENSES












Salaries and benefits

496



1,263



1,759





1,015



1,015


Equity based compensation



27



27








General and administrative

433



1,132



1,565





1,052



1,052


Depreciation and amortization

33



17



50





17



17


Other

592



26



618








Total operating expenses

1,554



2,465



4,019





2,084



2,084


OPERATING INCOME (LOSS)

(96)



(2,325)



(2,421)





(2,057)



(2,057)


Other

(20)



(27)



(47)





(31)



(31)


INCOME (LOSS) BEFORE INCOME TAXES

(116)



(2,352)



(2,468)





(2,088)



(2,088)


Income tax (expense) benefit












NET INCOME (LOSS)

(116)



(2,352)



(2,468)





(2,088)



(2,088)


(Income) loss from consolidated entities attributable to noncontrolling interests

40



373



413





684



684


Net (income) loss attributable to redeemable noncontrolling interests



991



991





788



788


NET INCOME (LOSS) ATTRIBUTABLE TO THE COMPANY

(76)



(988)



(1,064)





(616)



(616)


Interest expense and amortization of loan costs

14



7



21








Depreciation and amortization

23



8



31





4



4


Income tax expense (benefit)












EBITDA

(39)



(973)



(1,012)





(612)



(612)


Equity-based compensation



5



5








Transaction costs

167





167








Severance costs

88





88








Adjusted EBITDA

216



(968)



(752)





(612)



(612)


Interest expense and amortization of loan costs

(14)



(7)



(21)








Income tax benefit (expense)












Adjusted net income (loss)

$

202



$

(975)



$

(773)



$



$

(612)



$

(612)


Adjusted net income (loss) per diluted share available to common stockholders

$

0.09



$

(0.42)



$

(0.33)



$



$

(0.27)



$

(0.27)


Weighted average diluted shares

2,316



2,316



2,316



2,276



2,276



2,276


View original content:http://www.prnewswire.com/news-releases/ashford-reports-third-quarter-2017-results-300548649.html

SOURCE Ashford Inc.