Braemar Hotels & Resorts : 3rd Quarter 2024 Earnings Update - November 2024

BHR

3rd Quarter 2024 Earnings Update

Forward Looking Statements and Non-GAAP Measures

In keeping with the SEC's "Safe Harbor" guidelines, certain statements made during this presentation could be considered forward-looking and subject to certain risks and uncertainties that could cause results to differ materially from those projected. 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 forward-looking statements include, but are not limited to, our business and investment strategy, our understanding of our competition, current market trends and opportunities, projected operating results, and projected capital expenditures.

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: the Risk Factors discussed in our Annual Report on Form 10-K for the year ended December 31, 2023; rising interest rates and inflation; macroeconomic conditions, such as a prolonged period of weak economic growth and volatility in the capital and financial markets; uncertainty in the business sector and market volatility due to the recent failures of Silicon Valley Bank, New York Signature Bank and First Republic Bank; general and economic business conditions affecting the lodging and travel industry; our ability to repay, refinance or restructure our debt and the debt of certain of our subsidiaries; anticipated or expected purchases or sales of assets; our projected operating results; completion of any pending transactions; risks associated with our ability to effectuate our dividend policy, including factors such as operating results and the economic outlook influencing our board's decision whether to pay further dividends at levels previously disclosed or to use available cash to pay dividends; 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, legislative and regulatory changes, including changes to the Internal Revenue Code of 1986, as amended (the "Code"), and related rules, regulations and interpretations governing the taxation of REITs; and limitations imposed on our business and our ability to satisfy complex rules in order for us to qualify as a REIT for federal income tax purposes. These and other risk factors are more fully discussed in the company's filings with the Securities and Exchange Commission.

EBITDA is defined as net income (loss) before interest expense and amortization of loan costs, depreciation and amortization, income taxes, equity in (earnings) loss of unconsolidated entity and after the Company's portion of EBITDA of OpenKey. In addition, we excluded impairment on real estate, (gain) loss on insurance settlement and disposition of assets and Company's portion of EBITDA of OpenKey from EBITDA to calculate EBITDA for real estate, or EBITDAre, as defined by NAREIT. EBITDA yield is defined as trailing twelve month EBITDA divided by the purchase price or debt amount. A capitalization rate is determined by dividing the property's net operating income by the purchase price. Net operating income is the property's Hotel EBITDA minus a capital expense reserve of either 4% or 5% of gross revenues. Hotel EBITDA flow-through is the change in Hotel EBITDA divided by the change in total revenues. EBITDA, FFO, AFFO, CAD and other terms are non-GAAP measures, reconciliations of which have been provided in prior earnings releases and filings with the SEC or in the appendix to this presentation.

The calculation of implied equity value is derived from an estimated blended capitalization rate ("Cap Rate") for the entire portfolio using the capitalization rate method. The estimated Cap Rate is based on recent Cap Rates of publically traded peers involving a similar blend of asset types found in the portfolio, which is then applied to Net Operating Income ("NOI") of the company's assets to calculate a Total Enterprise Value ("TEV") of the company. From the TEV, we deduct debt and preferred equity and then add back working capital to derive an equity value. The capitalization rate method is one of several valuation methods for estimating asset value and implied equity value. Among the limitations of using the capitalization rate method for determining an implied equity value are that it does not take into account the potential change or variability in future cash flows, potential significant future capital expenditures, the intended hold period of the asset, or a change in the future risk profile of an asset.

This presentation is for informational purposes only and is not an offer to sell, or a solicitation of an offer to buy or sell, any securities of Braemar Hotels & Resorts Inc. or any of its respective affiliates, and may not be relied upon in connection with the purchase or sale of any such security.

Prior to investing in Braemar, potential investors should carefully review Braemar's periodic filings with the Securities and Exchange Commission, including, but not limited to, Braemar's most current Form 10-K, Form 10-Q and Form 8-K's, including the risk factors included therein.

Company Presentation | November 2024

2

Experienced Management Team

RICHARD J. STOCKTON

DERIC S. EUBANKS, CFA

CHRISTOPHER C. NIXON

Chief Executive Officer &

Chief Financial Officer

Executive Vice President &

President

Head of Asset Management

Company Presentation | November 2024

3

Company Fact Sheet

Since inception in 2013, we have significantly increased Gross Asset Value and EBITDA for our iconic and irreplaceable portfolio

$228.3MM

EQUITY MARKET CAP(1)

NYSE:

BHR

$1.8B

ENTERPRISE VALUE(1)

HIGHEST RevPAR LODGING REIT

Total Assets (2)(3)

+126%

$2,178

$962

2013

9/30/2024

Number of Hotels(2)(5)

+7

8

15

2013

9/30/2024

% of Total Hotel Rev

(2)(3)(4)

+199%

$233

$698

2013

TTM Q3'24

Hotel EBITDA (2)(3)(4)

+129%

$78

$179

2013

TTM Q3'24

Top-5 Properties

(Q3 2024 TTM Total Revenue)(2)

1.

Ritz-Carlton Sarasota

13%

2.

Ritz-Carlton Dorado Beach

12%

3.

Ritz-Carlton St. Thomas

11%

4.

Four Seasons Scottsdale

10%

5.

Capital Hilton

9%

Company Presentation | November 2024

4

Positioned for Consistent Performance

Stable Industry Performance Continuing

Balanced Portfolio Composition

Recent Results & Developments

Refinancing to Lower Interest Cost

The Notary Hotel

Company Presentation | November 2024

5

Ritz-Carlton Reserve Dorado Beach

Stable Industry Performance Continuing

Industry RevPAR Continues to Exceed 2019

Occupancy Index

140

120

100

95

96

95

95

87

80

60

40

20

0

2021

2022

2023

2024F

2025F

Source: Lodging Analytics Research & Consulting Q3 2024

U.S. KPIs, Indexed to 2019

ADR Index

RevPAR Index

140

140

119

121

124

120

120

115

118

114

108

113

100

95

100

83

80

80

60

60

40

40

20

20

0

0

2021

2022

2023

2024F

2025F

2021

2022

2023

2024F

2025F

Company Presentation | November 2024

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Industry Real RevPAR Stabilizing at a New Level

Real ADR Stabilizing

$200

70%

$160

60%

$131

$129

50%

$120

$80

40%

30%

$40

20%

$0

10%

Q3'19

Q3'20

Q3'21

Q3'22

Q3'23

Q3'24

0%

Real ADR

Nominal ADR

Occupancy Stabilizing

66%

63%

Q3'19

Q3'20

Q3'21

Q3'22

Q3'23

Q3'24

Real RevPAR Stabilizing

$100

$87

$81

$80

$60

$40

$20

Marriott Seattle Waterfront

The Clancy

$0

Q3'19

Q3'20

Q3'21

Q3'22

Q3'23

Q3'24

Real RevPAR

Nominal RevPAR

Source: STR

Company Presentation | November 2024

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Luxury RevPAR Growth Forecasted

2024 Forecasted Growth YoY

4.0%

3.0%

2.0%

1.0%

0.0%

-1.0%

-2.0%

-3.0%

2.2%

1.8%

1.5%

1.1%

1.1%

1.0%

0.8%

0.4%

0.4%

0.3%

-0.3%

-0.3%

-0.1%

-0.4%

-0.9%

-1.3%

-2.3%

-2.4%

Luxury

Upper Upscale

Upscale

Upper Midscale

Midscale

Economy

Source: Lodging Analytics Research & Consulting Q3 2024

Company Presentation | November 2024

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Ritz-Carlton St. Thomas

Balanced Portfolio Composition

Exposure to Both Resorts and Urban Properties

Disclaimer

Braemar Hotel & Resorts Inc. published this content on November 07, 2024, and is solely responsible for the information contained herein. Distributed by Public, unedited and unaltered, on November 08, 2024 at 01:07:08.133.