Ashford Hospitality Trust Reports Second Quarter Results

August 1, 2012 · 0 Comments

DALLAS, Aug. 1, 2012 (www.hospitalitybusinessnews.com) – Ashford Hospitality Trust, Inc. today reported the following results and performance measures for the second quarter ended June 30, 2012. The performance measurements for Occupancy, Average Daily Rate (ADR), Revenue Per Available Room (RevPAR), and Hotel Operating Profit (or Hotel EBITDA) are proforma. Unless otherwise stated, all reported results compare the second quarter ended June 30, 2012, with the second quarter ended June 30, 2011 (see discussion below). The reconciliation of non-GAAP financial measures is included in the financial tables accompanying this press release.

FINANCIAL HIGHLIGHTS

RevPAR increased 6.2% for all Legacy hotels in continuing operations, driven by a 3.7% increase in ADR and a 182 basis point increase in occupancy
RevPAR increased 6.4% for all hotels in the Highland Hospitality Portfolio, driven by a 3.1% increase in ADR and a 239 basis point increase in occupancy
Hotel operating profit for all hotels, including Highland, increased by $10.7 million, or 10.8%
Hotel operating profit margin increased 159 basis points for all Legacy hotels not under renovation in continuing operations
Hotel operating profit margin increased 221 basis points for the 22 hotels in the Highland Hospitality Portfolio not under renovation in continuing operations
Net loss attributable to common shareholders was $13.3 million, or $0.20 per diluted share, compared with net loss attributable to common shareholders of $29.1 million, or $0.49 per diluted share, in the prior-year quarter
Adjusted funds from operations (AFFO) was $0.52 per diluted share for the quarter as compared with $0.65 from the prior-year quarter; Interest Rate Derivative Income decreased by $10.2 million as the benefits from our Flooridor terminated in 2011, impacting AFFO per share by $0.12; Increases in Income Taxes, Interest Expense, Equity Based Compensation, and Preferred Dividends impacted AFFO per share by an additional $0.07
Fixed charge coverage ratio was 1.48x under the senior credit facility covenant versus a required minimum of 1.35x
During the second quarter 2012, Ashford sold 300,802 shares of its Series A and Series D Cumulative Preferred Stock through its At-the-Market program for total gross proceeds of $7.4 million
At the end of the second quarter 2012, Ashford had cash and cash equivalents of $139 million

CAPITAL ALLOCATION

Capex invested in the quarter for the Legacy portfolio was $20.8 million
Capex invested in the quarter for the Highland Hospitality Portfolio was $7.0 million

CAPITAL STRUCTURE

During the second quarter, Ashford successfully refinanced its sole 2012 debt maturity. The $167.2 million loan set to mature in May 2012 was refinanced with a new $135.0 million loan that matures in May of 2014 and has three one-year extension options subject to satisfaction of certain conditions. The new loan provides for a floating interest rate of LIBOR + 6.50%, with no LIBOR Floor. Additionally, the new loan is secured by nine hotels as the Doubletree Guest Suites in Columbus, Ohio, was unencumbered as a result of this refinancing. The Company is currently actively marketing the Doubletree Columbus for sale.

Ashford is presently engaged in discussions regarding the refinancing of its $101 million of loans in the Highland Hospitality Portfolio set to mature in early 2013. The trailing 12-month debt yield on this high quality portfolio is currently in excess of 16%. At this time, given the potential loan proceeds, there is no anticipated pay down required. The Company is well positioned for essentially all upcoming debt maturities in 2013 and 2014.

During the second quarter, the Company took an impairment charge of $4.1 million on the Hilton El Conquistador Resort in Tucson, AZ. The Company is currently in discussions with the lender on the property for a potential deed-in-lieu or consensual foreclosure and receivership transaction.

Additionally, in the second quarter 2012, the Company sold 48,575 shares of its 8.55% Series A Cumulative Preferred Stock at $24.61 per share and sold 252,227 shares of its 8.45% Series D Cumulative Preferred Stock at $24.49 per share through its At-the-Market program for total gross proceeds of $7.4 million.

HIGHLAND HOSPITALITY PORTFOLIO UPDATE

The Highland Hospitality Portfolio experienced RevPAR growth of 6.4% during the second quarter of 2012, with RevPAR growth for hotels not under renovation in continuing operations of 7.6%. For all 28 hotels in the Highland Hospitality Portfolio, Hotel EBITDA Margin increased 205 bps and Hotel EBITDA flow-through was 80%. For the 22 hotels not under renovation during the second quarter 2012, Hotel EBITDA Margin increased 221 basis points and Hotel EBITDA flow-through was 71%. Hotel EBITDA increased 11.3% in the second quarter for all hotels in the Highland Hospitality Portfolio, and since the closing of the acquisition, trailing 12-month EBITDA has increased 15.8%.

PORTFOLIO REVPAR

As of June 30, 2012, the Company’s Legacy portfolio consisted of direct hotel investments with 96 properties classified in continuing operations. During the second quarter, 87 of the hotels included in continuing operations were not under renovation. The Company believes reporting its operating metrics for continuing operations on a proforma total basis (all 96 hotels) and proforma not under renovation basis (87 hotels) is a measure that reflects a meaningful and focused comparison of the operating results in its direct hotel portfolio. The Company’s reporting by region and brand includes the results of all 96 hotels in continuing operations. Details of each category are provided in the tables attached to this release.

Proforma RevPAR increased 6.2% to $106.40 for all hotels in the Legacy portfolio on a 3.7% increase in ADR and a 182 basis point increase in occupancy
Proforma RevPAR increased 7.3% to $105.06 for hotels not under renovation in the Legacy portfolio on a 4.0% increase in ADR and a 237 basis point increase in occupancy
Proforma RevPAR increased 6.4% to $111.89 for all hotels in the Highland Hospitality Portfolio on a 3.1% increase in ADR and a 239 basis point increase in occupancy
Proforma RevPAR increased 7.6% to $110.97 for hotels not under renovation in the Highland Hospitality Portfolio on a 3.0% increase in ADR and a 328 basis point increase in occupancy

HOTEL EBITDA MARGINS AND QUARTERLY SEASONALITY TRENDS

During the quarter, Hotel operating profit (Hotel EBITDA) for all Legacy hotels increased 10.7% to $82.6 million. For the 87 hotels that were not under renovation, Proforma Hotel E
BITDA increased 12.4% to $72.9 million. Proforma Hotel EBITDA margin (expressed as a percentage of Total Hotel Revenue) increased 159 basis points to 34.1% for the 87 Legacy hotels not under renovation. For all 96 Legacy hotels included in continuing operations, Proforma Hotel EBITDA margin increased 142 basis points to 33.4%.

For the Company’s 71.74% share of all hotels in the Highland Hospitality Portfolio, Hotel operating profit (Hotel EBITDA) increased 11.3% to $26.9 million. For the 22 hotels in the Highland Hospitality Portfolio that were not under renovation, Proforma Hotel EBITDA increased 13.5% to $21.4 million. Proforma Hotel EBITDA margin (expressed as a percentage of Total Hotel Revenue) increased 221 basis points to 32.2% for the 22 Highland hotels not under renovation. For all 28 Highland Hospitality hotels included in continuing operations, Proforma Hotel EBITDA margin increased 205 basis points to 33.2%.

Beginning with this quarterly release, the Company has added additional disclosure information regarding property level trailing 12-month Hotel EBITDA by debt pool. The decision to add this additional disclosure comes after the Company had received feedback from multiple investors and analysts. The Company believes this additional disclosure will assist the investment community in analyzing Ashford and help analysts and investors see the benefits of the non-recourse nature of its property level debt. Prior to providing this information, the investment community could only reference the Company’s total EBITDA and total debt when applying a valuation multiple. With this new disclosure, analysts and investors can analyze the EBITDA of the Company by debt pool and when using a valuation multiple approach, can see where the market might be inadvertently implying negative equity value to certain debt pools. Implied negative equity value in any debt pools may underestimate the benefits of non-recourse debt, and all of the Company’s property level debt is non-recourse. Also, as a result of the feedback received from analysts and investors, the Company has added some additional performance tables to the release while other tables have been removed.

Additionally, the Company has started adding back the non-cash stock/unit-based amortization expense in its calculation of Adjusted EBITDA. Since this is a non-cash item, the Company believes this gives a better picture of true cash EBITDA and is consistent with many industry peers. The Company will continue to show the non-cash stock/unit-based amortization expense as a deduct for AFFO purposes and the associated shares are reflected in its fully diluted share count once the shares vest.

Ashford believes year-over-year Hotel EBITDA and Hotel EBITDA margin comparisons are more meaningful to gauge the performance of the Company’s hotels than sequential quarter-over-quarter comparisons. Given the substantial seasonality in the Company’s portfolio and its active capital recycling, to help investors better understand this seasonality, the Company provides quarterly detail on its Proforma Hotel EBITDA and Proforma Hotel EBITDA margin for the current and certain prior-year periods based upon the number of core hotels in the portfolio as well as its pro-rata share of the Highland portfolio as of the end of the current period. As Ashford’s portfolio mix changes from time to time so will the seasonality for Proforma Hotel EBITDA and Proforma Hotel EBITDA margin. The details of the quarterly calculations for the previous four quarters for the current portfolio of 96 Legacy hotels included in continuing operations together with Ashford’s pro-rata share of the Highland portfolio are provided in the table attached to this release.

COMMON STOCK DIVIDEND

On June 15, 2012, Ashford announced that its Board of Directors had declared a quarterly cash dividend of $0.11 per diluted share for the Company’s common stock for the second quarter ending June 30, 2012, payable July 16, 2012, to shareholders of record as of June 29, 2012.

Monty J. Bennett, Chief Executive Officer, commented, “Our solid second quarter 2012 RevPAR improvement for both our Legacy and Highland Hospitality portfolios reflects the continuing, successful integration of Highland into our overall portfolio, as the Highland hotels benefit from more efficient property management and capital investments that we’ve made to unlock the inherent value in these assets. At the same time, U.S. lodging industry conditions have shown steady improvement as a lack of new supply has helped the market. We maintain that we are still in the early stages in this cycle and see tremendous potential upside as market conditions gradually strengthen. At Ashford, we remain conservative after what we’ve seen during the prior industry down cycle. With today’s continuing economic concerns, we have been diligent in proactively addressing upcoming debt maturities and ensuring the Company has the necessary financial flexibility to weather any potential short-term economic fluctuations, while positioning ourselves to take advantage of opportunistic investments that meet our risk-adjusted return criteria as hotel fundamentals continue to improve.”

ASHFORD HOSPITALITY TRUST, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(in thousands, except share amounts)

					June 30,	December 31,
					2012	2011
					(Unaudited)
ASSETS
	Investment in hotel properties, net				$ 2,929,113	$ 2,957,899
	Cash and cash equivalents				139,466	167,609
	Restricted cash				76,558	84,069
	Accounts receivable, net of allowance of $246 and $212, respectively				41,167	28,623
	Inventories				2,366	2,371
	Notes receivable				11,262	11,199
	Investment in unconsolidated joint ventures				169,246	179,527
	Investments in securities and other				30,739	21,374
	pan class="prnews_span" style="FONT-FAMILY: Arial; FONT-SIZE: 8pt">Deferred costs, net				18,265	17,421
	Prepaid expenses				13,897	11,308
	Derivative assets				22,253	37,918
	Other assets				5,467	4,851
	Intangible asset, net				2,765	2,810
	Due from third-party hotel managers				62,115	62,747

		Total assets			$ 3,524,679	$ 3,589,726

LIABILITIES AND EQUITY
Liabilities:
	Indebtedness				$ 2,318,943	$ 2,362,458
	Accounts payable and accrued expenses				94,232	82,282
	Dividends payable				18,260	16,941
	Unfavorable management contract liabilities				12,482	13,611
	Due to related party, net				2,330	2,569
	Due to third-party hotel managers				2,146	1,602
	Liabilities associated with investments in securities and other				9,953	2,246
	Other liabilities				5,435	5,400

		Total liabilities			2,463,781	2,487,109

Redeemable noncontrolling interests in operating partnership					126,466	112,796

Equity:
		Preferred stock, $0.01 par value, 50,000,000 shares authorized:
			Series A Cumulative Preferred Stock, 1,657,206 shares issued and outstanding at
				June 30, 2012 and 1,487,900 shares issued and outstanding at December 31, 2011	17	15
			Series D Cumulative Preferred Stock, 9,468,706 shares issued and outstanding at
				June 30, 2012 and 8,966,797 shares issued and outstanding at December 31, 2011	95	90
			Series E Cumulative Preferred Stock, 4,630,000 shares issued and outstanding		46	46
		Common stock, $0.01 par value, 200,000,000 shares authorized, 124,896,765 shares
			issued, 68,163,909 and 68,032,289 shares outstanding, respectively		1,249	1,249
		Additional paid-in capital			1,761,158	1,746,259
		Accumulated other comprehensive loss			(261)	(184)
		Accumulated deficit			(679,533)	(609,272)
		Treasury stock, at cost (56,732,856 sh ares and 56,864,476 shares, respectively)			(164,829)	(164,796)
			Total shareholders’ equity of the Company		917,942	973,407
	Noncontrolling interests in consolidated joint ventures				16,490	16,414

		Total equity			934,432	989,821

			Total liabilities and equity		$ 3,524,679	$ 3,589,726

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

				Three Months Ended			Six Months Ended
				June 30,			June 30,
				2012		2011	2012	2011
				(Unaudited)			(Unaudited)
REVENUE
	Rooms			$ 194,188		$ 177,040	$ 368,736	$ 339,789
	Food and beverage			44,415		41,242	86,117	79,649
	Rental income from operating leases			-		1,484	-	2,704
	Other			10,453		10,253	20,015	19,599

		Total hotel revenue		249,056		230,019	474,868	441,741
	Asset management fees and other			77		80	152	148

		Total Revenue		249,133		230,099	475,020	441,889

EXPENSES
	Hotel operating expenses
		Rooms		42,852		39,205	82,590	76,251
		Food and beverage		28,758		27,121	57,401	53,602
		Other expenses		75,715		68,928	145,061	134,402
		Management fees		10,047		9,184	19,198	18,043

			Total hotel operating expenses	157,372		144,438	304,250	282,298

	Property taxes, insurance, and other			10,525		11,769	22,680	22,656
	Depreciation and amortization			34,184		33,027	68,539	65,804
	Impairment charges			4,025		(4,316)	3,933	(4,656)
	Gain on insurance settlement			-		(1,905)	-	(1,905)
	Transaction acquisition costs			-		406	-	(818)
	Corporate, general, and administrative:
		Stock/unit-based compensation		4,223		3,546	9,369	5,360
		Other general and administrative		7,707		7,459	12,807	19,528

			Total Operating Expenses	218,036		194,424	421,578	388,267

OPERATING INCOME				31,097		35,675	53,442	53,622

	Equity in earnings (loss) of unconsolidated joint ventures			23		(2,301)	(10,281)	25,824
	Interest income			22		23	54	59
	Other income			6,703		18,157	14,317	66,160
	Interest expense			(35,123)		(33,520)	(69,116)	(67,019)
	Amortization of loan costs			(1,466)		(1,288)	(2,678)	(2,367)
	Unrealized gain on investments			1,628		39	3,413 an>	39
	Unrealized loss on derivatives			(7,458)		(17,733)	(17,399)	(34,550)

INCOME (LOSS) FROM CONTINUING OPERATIONS BEFORE INCOME TAXES				(4,574)		(948)	(28,248)	41,768
	Income tax expense			(1,366)		(285)	(2,245)	(1,329)

INCOME (LOSS) FROM CONTINUING OPERATIONS				(5,940)		(1,233)	(30,493)	40,439
Loss from discontinued operations				-		(6,029)	-	(3,819)

NET INCOME (LOSS)				(5,940)		(7,262)	(30,493)	36,620
(Income) loss from consolidated joint ventures attributable to noncontrolling interests				(54)		(438)	224	(1,369)
Net (income) loss attributable to redeemable noncontrolling interests in operating partnership				1,180		3,389	4,238	(1,729)

NET INCOME (LOSS) ATTRIBUTABLE TO THE COMPANY				(4,814)		(4,311)	(26,031)	33,522
Preferred dividends				(8,490)		(24,771)	(16,822)	(31,326)

NET INCOME (LOSS) ATTRIBUTABLE TO COMMON SHAREHOLDERS				$ (13,304)		$ (29,082)	$ (42,853)	$ 2,196

INCOME PER SHARE – BASIC AND DILUTED:
	Basic:
		Income (loss) from continuing operations attributable to common shareholders		$ (0.20)		$ (0.40)	$ (0.64)	$ 0.11
		Loss from discontinued operations attributable to common shareholders		-		(0.09)	-	(0.07)

		Net income (loss) attributable to common shareholders		$ (0.20)		$ (0.49)	$ (0.64)	$ 0.04

		Weighted average common shares outstanding – basic		67,639		59,482	67,396	58,157

	Diluted:
		Income (loss) from continuing operations attributable to common shareholders		$ (0.20)		$ (0.40)	$ (0.64)	$ 0.11
		Loss from discontinued operations attributable to common shareholders		-		(0.09)	-	(0.07)

		Net income (loss) attributable to common shareholders		$ (0.20)	>	$ (0.49)	$ (0.64)	$ 0.04

		Weighted average common shares outstanding – diluted		67,639		59,482	67,396	58,157

	Dividends declared per common share:			$ 0.11		$ 0.10	$ 0.22	$ 0.20

Amounts attributable to common shareholders:
	Income (loss) from continuing operations, net of tax			$ (4,814)		$ 969	$ (26,031)	$ 37,768
	Loss from discontinued operations, net of tax			-		(5,280)	-	(4,246)
	Preferred dividends			(8,490)		(24,771)	(16,822)	(31,326)

	Net income (income) attributable to common shareholders			$ (13,304)		$ (29,082)	$ & nbsp; (42,853)	$ 2,196

ASHFORD HOSPITALITY TRUST, INC. AND SUBSIDIARIES
RECONCILIATION OF NET INCOME (LOSS) TO EBITDA
(in thousands)
(Unaudited)

		Three Months Ended		Six Months Ended
		June 30,		June 30,
		2012	2011	2012	2011

Net income (loss)		$ (5,940)	$ (7,262)	$ (30,493)	$ 36,620
(Income) loss from consolidated joint ventures attributable to noncontrolling interests		(54)	(438)	ss="prnews_p" style="MARGIN: 0in">224	(1,369)
Net (income) loss attributable to redeemable noncontrolling interests in operating partnership		1,180	3,389	4,238	(1,729)
Net income (loss) attributable to the Company		(4,814)	(4,311)	(26,031)	33,522

	Interest income	(22)	(23)	(54)	(59)
	Interest expense and amortization of loan costs	36,239	34,346	71,090	69,162
	Depreciation and amortization	33,434	32,402	67,017	64,563
	Impairment charges	4,025	1,921	3,933	1,581
	Income tax expense	tyle="FONT-FAMILY: Arial; FONT-SIZE: 8pt">1,366	285	2,245	1,414
	Net income (loss) attributable to redeemable noncontrolling interests in operating partnership	(1,180)	(3,389)	(4,238)	1,729
	Equity in (earnings) loss of unconsolidated joint ventures	(23)	2,301	10,281	(25,824)
	Company’s portion of EBITDA of unconsolidated joint ventures	25,116	21,864	39,680	67,909

EBITDA		94,141	85,396	163,923	213,997

	Amortization of unfavorable management contract liabilities	(565)	(565)	(1,129)	class="prnews_p" style="MARGIN: 0in">(1,129)
	Gain on sale/disposition of properties	-	(158)	-	(2,961)
	Non-cash gain on insurance settlements	-	(1,157)	-	(1,157)
	Write-off of loan costs, premiums, and exit fees, net	-	-	-	948
	Other income (1)	(6,703)	(18,157)	(14,317)	(66,160)
	Transaction acquisition costs	-	406	-	(818)
	Legal costs related to litigation settlements (2)	1,467	1,375	1,707	6,875
	Unrealized gain on investments	(1,628)	(39)	(3,413)	(39)
	Unrealized loss on derivatives	7,458	17,733	17,399	34,550
	Equity-based compensation	4,223	3,546	9,369	5,360
	Company’s portion of adjustments to EBITDA of unconsolidated joint ventures	49	1,217	144	(39,794)

class="prnews_span" style="FONT-FAMILY: Arial; FONT-SIZE: 8pt"> Adjusted EBITDA		$ 98,442	$ 89,597	$ 173,683	$ 149,672


(1)	Other income primarily consisting of income from interest rate derivatives in both periods, net realized loss on investments in securities and other in 2012, and a $30 million litigation settlement in 2011 are excluded from Adjusted EBITDA.
(2)	Legal costs associated with litigation settlements are excluded from Adjusted EBITDA.

RECONCILIATION OF NET INCOME (LOSS) TO FUNDS FROM OPERATIONS (“FFO”)
(in thousands, except per share amounts)
(Unaudited)
				yle="BORDER-BOTTOM: 1pt; TEXT-ALIGN: right; BORDER-LEFT: 1pt; PADDING-LEFT: 6pt; PADDING-RIGHT: 8pt; VERTICAL-ALIGN: bottom; BORDER-TOP: 1pt; BORDER-RIGHT: 1pt">
		Three Months Ended			Six Months Ended
		June 30,			June 30,
		2012	2011		2012	2011

Net income (loss)		class="prnews_p" style="MARGIN: 0in">$ (5,940)	$ (7,262)		$ (30,493)	$ 36,620
(Income) loss from consolidated joint ventures attributable to noncontrolling interests		(54)	(438)		224	(1,369)
Net (income) loss attributable to redeemable noncontrolling interests in operating partnership		1,180	3,389		4,238	(1,729)
Preferred dividends		(8,490)	(24,771)		(16,822)	(31,326)

Net income (loss) attributable to common shareholders		(13,304)	(29,082)		(42,853)	2,196

	Depreciation and amortization on real estate	33,374	32,340		66,892	64,439
	="FONT-FAMILY: Arial; FONT-SIZE: 8pt"> Impairment charges	4,025	1,921		3,933	1,581
	Gain on sale/dispoistion of properties	-	(158)		-	(2,961)
	Non-cash gain on insurance settlements	-	(1,157)		-	(1,157)
	Net income (loss) attributable to redeemable noncontrolling interests in operating partnership	(1,180)	(3,389)		(4,238)	1,729
	Equity in (earnings) loss of unconsolidated joint ventures	(23)	2,301		10,281	(25,824)
	Company’s portion of FFO of unconsolidated joint ventures	12,955	9,974		15,410	(999)

FFO available to common shareholders		35,847	12,750		49,425	39,004

	Dividends on convertible preferred stock	-	350		-	1,374
	Write-off of loan costs, premiums, and exit fees, net	-	-		-	948
	Transaction acquisition costs	-	406		-	(818)
	Legal costs related to litigation settlements (2)	1,467	1,375		1,707	6,875
	Other income (1)	1,303	-		1,681	(30,000)
	Unrealized gain on investments	(1,628)	(39)		(3,413)	(39)
	Unrealized loss on derivatives an>	7,458	17,733		17,399	34,550
	Non-cash dividends on Series B-1 preferred stock	-	17,363		-	17,363
	Equity-based compensation adjustment related to modified employment terms	(511)	-		480	-
	Company’s portion of adjustments to FFO of unconsolidated joint ventures	49	1,217		144	14,278

Adjusted FFO available to common shareholders		$ 43,985	$ 51,155		$ 67,423	$ 83,535

Adjusted FFO per diluted share available to common shareholders		$ 0.52	$ 0.65		$ 0.80	$ 1.06

Weighted average diluted shares		85,317	78,435		84,791	78,828


(1)	Other income in 2012 primarily represents net realized loss on investments in securities and other which is excluded from Adjusted FFO. Other income in 2011 represents a gain from a litigation settlement which is excluded from Adjusted FFO.
(2)	Legal costs associated with litigation settlements are excluded from Adjusted FFO.

ASHFORD HOSPITALITY TRUST, INC. AND SUBSIDIARIES
LEGAGY PORTFOLIO ONLY
SUMMARY OF INDEBTEDNESS OF CONTINUING OPERATIONS
JUNE 30, 2012
(dollars in thousands)
(Unaudited)


Indebtedness	Maturity	Interest Rate	Fixed-Rate Debt		Floating-Rate Debt		Total Debt	TTM Hotel EBITDA
Indebtedness	Maturity	Interest Rate	Fixed-Rate Debt		Floating-Rate Debt		Total Debt	TTM Hotel EBITDA

Aareal – 2 hotels	August 2013	LIBOR + 2.75%	$ -		$ 143,667		$ 143,667	$ 23,418
BoA MIP – 5 hotels	March 2014	LIBOR + 4.50%	-		176,400	(1)	176,400	18,242
JPM Floater – 9 hotels	May 2014	LIBOR + 6.50%	-		135,000		135,000	15,469
GEMSA Manchester – 1 hotel	May 2014	8.32%	5,381		-		5,381	585
Senior credit facility – Various	September 2014	LIBOR + 2.75% to 3.5%	-		-		-	N/A
Met Life El Con – 1 hotel	December 2014	Greater of 5.5% or LIBOR + 3.5%	-		19,740		19,740	(1,362)
UBS 1 – 8 hotels	December 2014	5.75%	105,787		-		105,787	12,443
Merrill 1 – 10 hotels	July 2015	5.22%	154,172		-		154,172	18,508
UBS 2 – 8 hotels	December 2015	5.70%	97,860		-		97,860	13,548
Prudential/Wheelock – 5 hotels	December 2015	12.72%	152,929		-		152,929	23,727
Merrill 2 – 5 hotels	February 2016	5.53%	111,310		-		111,310	16,204
Merrill 3 – 5 hotels	February 2016	5.53%	92,310		-		92,310	14,933
Merrill 7 – 5 hotels	February 2016	5.53%	79,961		-		79,961	12,490
Wachovia Philly CY – 1 hotel	April 2017	5.91%	34,935		-		34,935	9,092
Wachovia 3 – 2 hotels	April 2017	5.95%	128,014		-		128,014	13,281
Wachovia 7 – 3 hotels	April 2017	5.95%	260,497		-		260,497	22,491
Wachovia 1 – 5 hotels	April 2017	5.95%	115,386		-		115,386	9,942
Wachovia 5 – 5 hotels	April 2017	5.95%	103,714		-		103,714	8,516
Wachovia 6 – 5 hotels	April 2017	5.95%	157,813		-		157,813	14,624
Wachovia 2 – 7 hotels	April 2017	5.95%	126,232		-		126,232	10,776
TIF Philly CY – 1 hotel	June 2018	12.85%	8,098		-		8,098	N/A
class="prnews_span" style="FONT-FAMILY: Arial; FONT-SIZE: 8pt"> GACC Gateway – 1 hotel	November 2020	6.26%	103,170		-		103,170	16,215
Zion Jacksonville RI – 1 hotel	April 2034	Greater of 6% or Prime + 1%	-		6,568		6,568	1,015
Unencumbered hotels			-		-		-	2,864

Total			$ 1,837,569		$ 481,375		$ 2,318,943	$ 277,021

Percentage			79.2%		20.8%		100.0%

Weighted average interest rate			6.43%		4.83%		6.10%

Total indebtedness with effect of interest rate swaps			$ 1,837,569		$ 481,375		$ 2,318,943

Percentage with the effect of interest rate swaps			79.2%		20.8%		100.0%

Weighted average interest rate with the effect of interest rate swaps			4.71%	(2)	4.83%	(2)	4.74%

All indebtedness is non-recourse with the exception of the credit facility.

⁽¹⁾This mortgage loan has a one-year extension option beginning March 2014, subject to satisfaction of
certain conditions.

⁽²⁾These rates are calculated assumi
ng the LIBOR rate stays at the March 31, 2012 level and with the
effect of our interest rate derivatives.

HIGHLAND HOSPITALITY PORTFOLIO
(PIM HIGHLAND HOLDING LLC)
SUMMARY OF INDEBTEDNESS
ASHFORD’S PRO RATA 71.74% SHARE
JUNE 30, 2012
(dollars in thousands)
(Unaudited)


Indebtedness	Maturity	Interest Rate	Fixed-Rate Debt	Floating-Rate Debt		Total Debt	TTM Hotel EBITDA
Indebtedness	Maturity	Interest Rate	Fixed-Rate Debt	Floating-Rate Debt		Total Debt	TTM Hotel EBITDA

CIGNA Boston Back Bay – 1 hotel	January 2013	5.96%	$ 45,634	$ -		$ 45,634	$ 8,720
CIGNA Westin Princeton – 1 hotel	February 2013	5.97%	23,185			23,185	3,403
CIGNA Nashville Renaissance – 1 hotel	April 2013	6.11%	32,563			32,563	7,880
Wells Senior – 25 hotels	March 2014	LIBOR + 2.75%	-	380,222	(1)	380,222	59,202
Mezz 1 – 28 hotels	March 2014	Greater of 7.00% or LIBOR + 6.00%	-	103,642	(1)	103,642	79,205
Mezz 2 – 28 hotels	March 2014	Greater of 8.00% or LIBOR + 7.00%	-	98,665	(1)	98,665	79,205
Mezz 3 – 28 hotels	March 2014	Greater of 10.50% or LIBOR + 9.50%	-	84,570	(1)	84,570	79,205
Mezz 4 – 28 hotels	March 2014	LIBOR + 2.00%		13,218	(1)	13,218	79,205

Total (Ashford’s 71.74% share only)			$ 101,382	$ 680,316		$ 781,698	$ 79,205

Percentage			13.0%	87.0%		100.0%

Weighted average interest rate			6.01%	5.25%		5.35%

Percentage with the effect of interest rate swaps			13.0%	87.0%		100.0%

Total Ashford plus Ashford’s 71.74% share of PIM Highland Holding LLC			$ 1,938,951	$ 1,161,691		$ 3,100,641	$ 356,226

Percentage with the effect of interest rate swaps			62.5%	37.5%		100.0%

Weighted average interest rate with the effect of interest rate swaps			4.78%	5.08%		4.89%

⁽¹⁾Each of these loans has two one-year extension options beginning March 2014.

style="BORDER-BOTTOM: 1pt; TEXT-ALIGN: right; BORDER-LEFT: 1pt; PADDING-LEFT: 6pt; PADDING-RIGHT: 6pt; VERTICAL-ALIGN: bottom; BORDER-TOP: 1pt; BORDER-RIGHT: 1pt">

96,491

ASHFORD HOSPITALITY TRUST, INC. AND SUBSIDIARIES
LEGAGY PORTFOLIO ONLY
INDEBTEDNESS BY MATURITY ASSUMING EXTENSION OPTIONS ARE EXERCISED
JUNE 30, 2012
(in thousands)
(Unaudited)


	2012	2013	2014	2015	2016	Thereafter	Total

Aareal – 2 hotels	$ -	$ 140,167	$ -	$ -	$ -	$ -	140,167
GEMSA Manchester – 1 hotel	-	-	5,004	-	-	-	5,004
Senior credit facility – Various	-	-	-	-	-	-	-
Met Life El Con – 1 hotel	-	-	19,740	-	-	-	19,740
UBS 1 – 8 hotels	-	-	100,119	-	-	-	100,119
BoA MIP – 5 hotels	-	-	-	176,400	-	-	176,400
Merrill 1 – 10 hotels	-	-	-	142,922	-	-	142,922
UBS 2 – 8 hotels	-	-	-	90,680	-	-	90,680
Prudential/Wheelock – 5 hotels	-	-	-	146,415	-	-	146,415
Merrill 2 – 5 hotels	-	-	-	-	101,740	-	101,740
Merrill 3 – 5 hotels	-	-	-	-	84,374	-	84,374
Merrill 7 – 5 hotels	-	-	-	-	73,086	-	73,086
JPM Floater – 9 hotels	-	-	-	-	-	135,000	135,000
Wachovia Philly CY – 1 hotel	-	-	-	-	-	32,532	32,532
Wachovia 3 – 2 hotels	-	-	-	-	-	119,245	119,245
Wachovia 7 – 3 hotels	-	-	-	-	-	242,201	242,201
Wachovia 1 – 5 hotels	-	-	-	-	-	107,351	107,351
Wachovia 5 – 5 hotels	-	-	-	-	-	96,491
Wachovia 6 – 5 hotels	-	-	-	-	-	146,823	146,823
Wachovia 2 – 7 hotels	-	-	-	-	-	117,441	117,441
TIF Philly CY – 1 hotel	-	-	-	-	-	8,098	8,098
GACC Gateway – 1 hotel	-	-	-	-	-	89,886	89,886
Zion Jacksonville RI – 1 hotel	-	-	-	-	-	-	-

Principal due in future periods	$ -	$ 140,167	$ 124,863	$ 556,417	$ 259,200	$ 1,095,068	$ 2,175,715

Scheduled amortization payments remaining	18,510	31,030	30,978	28,230	16,723	17,757	143,228

Total indebtedness of continuing operations	$ 18,510	$ 171,197	$ 155,841	$ 584,647	$ 275,923	$ 1,112,825	$ 2,318,943

NOTE: These maturities assume no event of default would occur.

HIGHLAND HOSPITALITY PORTFOLIO
(PIM HIGHLAND HOLDING LLC)
INDEBTEDNESS BY MATURITY
ASSUMING EXTENSION OPTIONS ARE EXERCISED
ASHFORD’S PRO RATA 71.74% SHARE
JUNE 30, 2012
(in thousands)
(Unaudited)


	2012	2013	2014	2015	2016	Thereafter	Total

CIGNA Boston Back Bay – 1 hotel	$ -	$ 45,215	$ -	$ -	$ -	$ -	$ 45,215
CIGNA Westin Princeton – 1 hotel	-	22,939	-	-	-	-	22,939
CIGNA Nashville Renaissance – 1 hotel	-	31,774	-	-	-	-	31,774
Wells Senior – 25 hotels	-	-	-	-	380,222	-	380,222
Mezz 1 – 28 hotels	-	-	-	-	103,642	-	103,642
Mezz 2 – 28 hotels	-	-	-	-	98,665	-	98,665
Mezz 3 – 28 hotels	lass="prnews_span" style="FONT-FAMILY: Arial; FONT-SIZE: 8pt">-	-	-	-	84,570	-	84,570
Mezz 4 – 28 hotels	-	-	-	-	13,218	-	13,218

Principal due in future periods	$ -	$ 99,928	$ -	$ -	$ 680,316	$ -	$ 780,244

Scheduled amortization payments remaining	992	462	-	-	-	-	1,454

Total indebtedness of continuing operations (Ashford’s 71.74% share only)	$ 992	$ 100,390	$ -	$ -	$ 680,316	$ -	$ 781,698

Total indebtedness of continuing operations plus Ashford’s
71.74% share of PIM Highland Holding LLC	$ 19,502	$ 271,587	$ 155,841	$ 584,647	$ 956,239	$ 1,112,825	$ 3,100,641

ASHFORD HOSPITALITY TRUST, INC.
KEY PERFORMANCE INDICATORS – PRO FORMA
LEGACY PORTFOLIO ONLY
(dollars in thousands)
(Unaudited) td>


			Three Months Ended			Six Months Ended
			June 30,			June 30,
			2012	2011	% Variance	2012	2011	% Variance

ALL HOTELS INCLUDED IN CONTINUING OPERATIONS:
		Room revenues (in thousands)	$ 193,002	$ 181,795	6.16%	$ 366,434	$ 348,234	5.23%
		RevPAR	$ 106.40	$ 100.22	6.17%	$ 101.01	$ 96.28	4.91%
		Occupancy	78.16%	76.34%	1.82%	74.57%	73.11%	1.46%
		ADR	$ 136.13	$ 131.29	3.69%	$ 135.46	$ 131.69	2.86%

NOTE:		The above pro forma table assumes the 96 hotel properties owned and included in continuing operations at June 30, 2012 were owned as of the beginning of the period presented.
								yle="BORDER-BOTTOM: 1pt; TEXT-ALIGN: right; BORDER-LEFT: 1pt; PADDING-LEFT: 6pt; PADDING-RIGHT: 12pt; VERTICAL-ALIGN: bottom; BORDER-TOP: 1pt; BORDER-RIGHT: 1pt">

ALL HOTELS NOT UNDER RENOVATION
	INCLUDED IN CONTINUING OPERATIONS:
		Room revenues (in thousands)	$ 169,337	$ 157,892	7.25%	$ 321,341	s="prnews_span" style="FONT-FAMILY: Arial; FONT-SIZE: 8pt">$ 303,119	6.01%
		RevPAR	$ 105.06	$ 97.95	7.26%	$ 99.68	$ 94.29	5.72%
		Occupancy	78.66%	76.29%	2.37%	75.14%	73.23%	1.91%
		ADR	$ 133.56	$ 128.39	4.03%	$ 132.67	$ 128.77	3

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