Q1 2021 Ashford Hospitality Trust Inc Earnings Call
Greetings and welcome to Ashford Hospitality Trust first quarter 2021 results conference call. At this time, all participants are in a listen only mode.
A question and answer session will follow the formal presentation. If anyone should require operator assistance. During the conference. Please press star Zero and your telephone keypad. Please note. This conference is being recorded I will now turn the conference over to Jordan Jennings Investor Relations for Ashford hospitality. Thank you you may begin.
Good day, everyone and welcome to today's call conference call to review the results for Ashford Hospitality Trust for the first quarter of 2021 and to update you on recent developments.
On the call today will be Rob Hayes, President and Chief Executive Officer, Derek Eubanks, Chief Financial Officer, and Jeremy Welter, Chief operating officer, the results as well as noticed other that's ability and this conference call on a listen only basis over the Internet were distributed yesterday afternoon, and a press release.
At this time, let me remind you that certain statements and assumptions and this conference call contain or are based upon forward looking information and are being made pursuant to the safe Harbor provision and the federal Securities regulations and that's why.
And 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 discussed and the company's filings with the Securities and Exchange Commission.
Before and looking statements included in this conference call are only made as of the day of the call and the company and not obligated to publicly update or revise them.
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-K with the SEC on May four 2021 and May also be accessed through the company's website at www Dot H T Rowe.
<unk> Dot 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 first quarter of 2021, but the first quarter of 2020.
I will now turn the call over to Rob Hey, Please go ahead Sir.
Good morning, and welcome to our call.
I'll start by providing an overview of the current environment and how Ashford Trust has been navigating a recovery after that Derek will review, our financial results and Jeremy will provide an operational update on the portfolio.
First like to highlight some of our recent accomplishments and the main themes for our call.
We had strong earnings and the first quarter that exceeded both street estimates and our internal budgets, we reported positive hotel EBITDA for the quarter for the first time since the first quarter of 2020.
Second early in the quarter, we secured a $200 million strategic financing with additional future commitments about 250 million to provide multiple years of liquidity for the company.
Third we have deleveraged, our balance sheet by over half a billion dollars during the past 12 months.
And lastly, even with and already attractive loan maturity schedule and we have we have successfully modified property loan extension tests on two large pools for 2023 and 2024 as well as another large loan pool for 2024, and 2025, making it easy for us are easier for us to qualify for those extent.
And options.
This loan modification initiatives will continue to be a focus for us going forward there.
And there have been numerous positive developments for both our company and the hospitality industry over the past few months, we highlighted many of them and an updated investor deck that we put out in early April we encourage you to review that deck is available on our website.
And as it relates to our liquidity and as we mentioned on our last call in January we completed a crucial strategic financing, we drew $200 million at the closing of the financing and have the option to draw an additional $250 million if needed.
At this time, we are hopeful that we may not need to draw any remaining funds from that facility, but that will likely depend on the ongoing strength and trajectory of the industry recovery and.
Investors should also remember that effectively all of our hotel loans are currently and cash traps and and maybe some time before those loans allow us the ability to pull cash from our properties to corporate.
We are optimistic about the long term outlook for the company and by taking decisive actions to strengthen our balance sheet with this strategic financing and other steps. We've taken we now have multiple years of runway that will allow us to capitalize on a recovery we are seen in the hospitality industry.
We have significantly reduced our planned spend for capital expenditures. This year, however, given the sizable strategic capital expenditures and he made at our properties over the past several years, we believe our hotels are and fantastic condition and are well positioned for the industry rebound.
And further improve our liquidity profile, we have suspended both our common and preferred dividends and Derek will provide more detail around our liquidity outlook.
Let me now turn to the operating performance of our hotels were watching industry is clearly showing signs of improvement. We are very encouraged by the development and deployment of vaccines and the U S and hope that we will continue to see progress and upfront and.
While our hotels continue to have negative operating it.
Income and January and February our hotels performed well and March enough. So that Ashford Trust had positive net operating income for the quarter.
Second quarter, let's be building upon that strong March and April numbers look likely to exceed March numbers. So we are confident that the industry recovery is finally, taking hold we believe our geographically diverse portfolio consisting of high quality well located assets across the U S that are approximately 80% reliant on transient demand will be and are positioned to cash.
Capitalized on the pent up leisure and building trains and corporate demand we are seeing.
We continue to be focused on aggressive cost control initiatives working closely with our property managers to minimize cost structures and maximize liquidity at the hotels. This is where our relationship with our affiliated property manager Remington really sets us apart Remington was able to quickly cut costs and rapidly adjusted to the new operating environment and the same way that they.
We are hyper responsive on the way down we expect them to be hyper responsive on the way up mitigating cost creep as much as possible throughout the recovery. We are proud of their efforts over the past year and believe this important relationship has enabled us to outperform the industry from an operations standpoint, and Jeremy will discuss this in more detail.
The past 12 months have been extraordinary by any measure and I cannot be proud of the effort and the performance of our teams. During this challenge our management team has extensive experience in navigating tough market environments and we believe we have the right plan in place to capitalize on the recovery as it unfolds. This plan includes continuing to maximize liquidity cross the company optimizing operating.
And performance of our assets as they recover delevering the balance sheet over time and looking for opportunities to invest and grow as we bounce off the trough and the industry cycle, we will be laser focused on all of these I'll now turn the call over to Derek to review, our first quarter financial performance.
Thanks, Rob for the first quarter of 2021, we reported a net loss attributable to common stockholders of $91 $6 million or $1 10 per diluted share for the quarter, we reported <unk> per diluted share of negative <unk> 30 cents and.
Adjusted EBITDA totaled negative $5 $2 million for the quarter.
At the end of the first quarter, we had $3 $9 billion of loans with a blended average interest rate of four 1%.
Our loans were approximately 11% fixed rate and 89% floating rate we.
We utilize floating rate debt as we believe it is a better hedge of our operating cash flows. However, we do utilize caps on those floating rate loans to protect the company against significant interest rate increases.
Our hotel loans are all non recourse and as Rob mentioned nearly all of them are currently and cash traps, meaning that we are currently unable to utilize property level cash flow corporate related purposes, as the properties recover and meet the various debt yield our coverage thresholds, we will be able to utilize that cash freely at corporate.
We ended the quarter with cash and cash equivalents of $225 $4 million and restricted cash of $67 $7 million.
The vast majority of that restricted cash is comprised of lender and manager held reserve accounts at the end of the quarter. We also had $11 $8 million and 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 also ended the quarter with net working capital of $223 million compared to net working capital of $9 $8 million at the end of the previous quarter, which highlights the improvement and our liquidity and financial position.
From a cash utilization standpoint, our portfolio generated hotel EBITDA of $9 $8 million in the month of March.
Our current monthly run rate for interest expense is approximately $11 $4 million and our current monthly run rate for corporate G&A and advisory expense is approximately $4 million.
And total our current monthly cash utilization is approximately $6 million to $7 million and material improvement from our most recent earnings call. When we estimated it to be $18 million to $20 million.
As of March 31, 2020, our portfolio I'm, sorry March 31 twice a day one our portfolio consisted of 102 hotels with 22542 net rooms, and our current share count stands at approximately $146 8 million fully diluted shares outstanding which is comprised.
Of $144 7 million shares of common stock and $2 1 million op units.
And the first quarter, our weighted average fully diluted share count used to calculate <unk> per share included approximately $14 5 million common shares associated with the exit fee on the strategic financing we completed in January.
The exit fee will be owed once the facility is repaid and could be paid in cash or stock.
Assuming yesterdays closing stock price of $3 and once and our equity market cap is approximately $442 million.
During the quarter and subsequent to the end of the quarter, we entered into modification agreements on three of our loans the $395 million J P. Morgan eight portfolio alone representing eight hotels, the $419 million ml 17 portfolio loans, representing 17 hotels and.
The $240 million Renaissance Nashville, Westin Princeton portfolio alone representing two hotels each of these modification agreements involved is catching up deferred interest in exchange for reducing future debt yield extension tests, thus, making it easier for us to qualify for those future extension options.
As we previously discussed we have been actively exchanging our preferred stock for common stock as a way to de lever our balance sheet removes the accrued dividend liability and improve our equity flow through these exchanges, we've exchanged approximately 58% of our original preferred stock and.
Approximately $325 million of face value and the common stock.
These exchanges also eliminated a significant amount of accrued preferred dividends.
After taking into account the $200 million of new corporate debt that we closed on in January we have lowered our outstanding debt plus preferred equity by over $535 million.
We have also been opportunistically raising equity capital to shore up our balance sheet during.
During the fourth quarter of 2020 and into the first quarter of 2021, we issued approximately 10 4 million shares of common stock under an equity line raising approximately $25 1 million and proceeds.
During the first quarter, we also issued $13 7 million shares of common stock under our standby equity distribution agreement or cedar for approximately $46 million and proceeds.
We recently completed a second equity line issuing $20 5 million shares of common stock for approximately $43 6 million and proceeds.
And in total we have raised approximately $89 million. This year from the sale of our common stock and January we sold a small hotel the le Meridien, and Minneapolis, which provided a $7 $3 million and net proceeds.
Over the past several months, we have taken numerous steps to strengthen our financial position and improve our liquidity and we are pleased with the progress that we've made.
While we still have work to do to improve our capital structure. We believe the company is now well positioned to benefit from the improving trends, we're seeing and the lodging industry.
This concludes our financial review and I would now like to turn it over to Jeremy to discuss our asset management activities for the quarter.
Thank you Derek comparable Revpar for our portfolio decreased 59% during the first quarter of 2021.
While hotel EBITDA flow through was a strong 68%.
We are extremely encouraged by the strong signs of the recovery that we are seeing across our portfolio.
And I can see has accelerated through the first quarter with January at 36% February at 41% and March at 49%.
Highest occupancy we've seen in the past year.
We're seeing green shoots across all segments, while leisure continues to lead the way.
March had more new definite group business booked than any other month in the last year.
As a result, we expect April occupancy numbers to exceed our strong March numbers.
And the past and especially now during the recovery, we had benefited from the diversity of our portfolio.
And our select service hotels recovered and incredible 70% of comparable occupancy and the first quarter.
Relative to the comparable 2019 period.
Similarly, our food.
Full service hotels recovered a solid 52% of comparable occupancy and the first quarter relative to the comparable 2019 period.
We are seeing significant pent up leisure demand and states that are relaxing restrictions.
This was particularly evident over spring break at our Florida assets.
Our la Concha key West Hotel had first quarter occupancy of 89% March occupancy was 96% driven by the strength of the spring break period.
In fact that occupancy level is higher than it was in March of 2019.
While capitalizing on the strong demand, we were able to increase seasonal premiums and upgraded room types and increased seasonal blackouts to discounting programs.
We're getting to a black and GOP margin of 63% for the first quarter.
Another hotel that is experiencing strong performance is the Hilton Santa Cruz, Scotts Valley, which achieved an 18% increase from first quarter occupancy relative to the comparable 2019 period.
This performance was largely driven by our ability to secure large group business from fire cleanup crews.
In addition to corporate transient business picking up the hotel is starting to see a promising trend at work from home Tech employees, leaving their bay area hotels homes and working remotely from the hotel.
This additional demand resulted in a year over year total revenue increase of 5% during the first quarter.
One of the most encouraging trends that we're seeing across our portfolio is a growing number of hotels that are achieving positive gross operating profit and the first quarter of more than 70% of our assets had positive G. L P and with that number increasing to 84% and March alone.
Our team remains laser focused on driving revenue and finding new operational efficiencies.
And the management team continues to have weekly cash flow calls, where the majority of the properties to review payables labor models and daily projections.
We have more visibility and insight into the day to day operations of our hotels than ever before.
And the relationships that we have with our brand partners.
Moving on and capital management, and recent and prior years, we were proactive and renovating our hotels to renew our portfolio that commitment has now resulted in huge competitive and strategic advantage.
As the market rebounds.
Not only are our properties more attractive to potential travelers, but we can also deploy capital more prudently throughout the recovery.
Looking ahead in 2020, one we plan to focus on strategically restarting and select projects that were put on hold.
Did that and we plan to renovate the ballroom at the Ritz Carlton Atlanta public space and guest rooms at the Hilton Santa Cruz guest rooms at the Marriott Fremont and public space at eight select service assets.
Cumulatively, we estimate spending $40 million to $50 million and capital expenditures in 2021, which is significantly less than we have spent and previous years.
Before moving to Q&A I'd like to reiterate how optimistic we are about the recovery of our industry with.
But the vaccine rollout and full force, we are seeing the booking window and span and bookings are now at the highest levels, we've seen over the past year and.
Additionally, we are seeing cancellations and an all time low since the start of the pandemic.
These are all great and cares and our forward looking pace suggests that these trends will continue and the future.
That concludes our prepared remarks, we will now open the call for Q&A.
Yeah, if you would like to ask a question. Please press star one on your telephone keypad and you saw.
And for me should tone will indicate your line is and the question to.
You May press star two if he would like to remove your question from the queue.
And for participants using speaker equipment, and it may be necessary to pick up the handset before pressing the star keys, our first question and from Tyler Batori with Janney capital markets. Please proceed.
Thank you good morning.
And I appreciate all the all the detail before.
First a lot of investors are focused on the labor situation out there right now what that might do to the cost structure at least from the short term can you elaborate a little bit more on the flow through for the quarter, but also talk a little bit more about what youre seeing on the on the labor fronts and.
Discuss how youre thinking about the pace of bringing back more quickly and core U S occupancy starts to build a true.
Well I'd say from a flow through standpoint, I think we were extremely pleased with the performance of the of our asset management team and and Remington and I think our flows were over 60% for the quarter. So on the heels of.
What we are dealing with from a revenue side I thought those flows were extremely strong and show themselves very well relative to the industry.
But youre right were undoubtedly seen.
Some I guess some issues at the property level in terms of getting people back to work and it's obviously not something just that we're seeing but we're seeing across the industry and across other industries as well.
And there's no doubt that the.
Additional unemployment benefits that go through September are and incentive for people not to come back from furlough or not to come back to work and that is a struggle that debt that we're dealing with and it's something that I think we are trying to communicate with.
The H L a and other people and D. C. Letting them know that it is a hindrance right now to getting people back to work is it there just got incentive too.
And so I think we're trying to do things and the operators that we work with and Remington and and our brands are trying to do things too to.
Have referrals and different signing bonuses and whatnot and I.
I think we're hopeful that it's a transitory thing until the fall and some of these benefits burn off.
But it's no doubt something that debt.
We think it's probably a shorter term issues and maybe a longer term issue Jeremy I don't know if you had any other color yeah, we want to bring people back to work. It's been a it's been a huge focus is as Rob mentioned.
Our largest management company Remington lodging and what they called the springboard campaign and they actually said Ah corporate team members to every single one of their properties.
And you get a pulse on and what we're seeing and and.
There's no question that we are running very lean and our assets and there's a good amount of.
Capacity to add more labor and that's what we're focused on because we don't want to burn out our teams I think that and the and the short term we will still continue to see stronger flows and and maybe stronger relative margins just because we can't you know.
Find the labor that we need.
But I do think that as a short term issue.
Hopefully, but and it's gonna be one that we're gonna have to deal with at least through probably September October time period.
Okay, Great and then following up on the operating environment broadly and I clearly positive results and commentary you know, it's great to hear that and April looks better than March can you talk a little bit more about some of the the green shoots that you're seeing out there on the corporate transient.
Thanks.
Sure I think well, there's no doubt that where we're seeing most of the green shoots as still and leisure and I think we as we look over the next quarter.
I think we are youre seeing probably.
Occupancy gains probably right now we think it can be each month of the quarter. So we think aprils and even more than.
March may over April and June over May and.
So that's very exciting because we haven't had that experience and and.
And a while and that's with US trying to push rate back right. Now if you look at the first quarter our rates were down about 35, 30% to 35% versus 2019, which I think is lower than what we were hoping for some time.
A few months ago, but as we're going forward into the rest of the year I think we're gonna to that the team hears me really pushing on on that rate to see if we can get that.
Reduction versus 2019 to materially be reduced I think on the corporate transient side, it's still like I said, it's still relatively small though we have had these gains that are month over month. The real question honestly is what is going to happen.
Post Labor day, and it's just it's hard to say I think our hope is that psychologically people. They hit the road this summer.
Ah you know realize they can travel the airports.
And the hotel rooms and feel safe.
Have a great experience and.
And.
We'll be ready to go for that the second half of the year I mean, you're seeing a lot of the large companies still have travel kind of travel bans through June kind of through the second quarter and those are going to start loosening up I mean, even as a just our Maryland personal experience and we've now had several different investment groups investment.
Bankers.
Brokers are starting to hit the road and we've been busy and stand over the last several weeks and it was funny and talking to them because they marvel at the greatness of business travel how great. It was to be on the road to have their own room due to and visiting people and so even just the sort of little word of mouth things I think demonstrate.
And that where we're hopeful on what business travel will be the second half of the year, Here's what's going on and Tyler.
Probably most people on this call that are listening in and they travel and for their own personal reasons.
And so we're seeing that happen that people are traveling and theres a lot of pent up demand and Malaysia segment and.
And as people do travel more outside of the corporate travel and they're gonna get more comfortable traveling for corporate purposes, and I think I did.
Think that there is.
A lot of pent up demand for face to face meetings to drive your business activities and so I think it'll be a little bit bast over the summer just because of the seasonality of our portfolio where during the summer months, we tend to have higher leisure.
And its anyway.
And so I think that will continue to see it increase every month like we have and the first quarter.
And then I do believe that there's going to be a point and time, where it does pop I just don't know what month. It is.
Okay, Great and then just the last question from me, there's some moving pieces here on the balance sheet side of things, obviously, you've made a lot of progress and help us think more about your leverage how it might evolve over time, both the rest of this year and then looking a little bit farther out but and also.
Help us think about when you might shift gears from the focus on the balance sheet and more leverage perhaps and I'm looking to take advantage of some of the dislocation out there and and capitalize on some of the opportunities and that's the recovery plays out.
Sure.
So to your first part of the question is if we do feel strongly that debt our leverage level needs to come down over time.
I spent quite a bit of time earlier this year, having calls with both and you know you all on the buy side investors on the sell side investment bankers and other industry participants to get a sense and feel for what they thought we could do better what we can improve on and.
And one of the comments that came back pretty consistently was too and improve the leverage profile of the company that's.
And that's something that's going to take years, that's not going to happen over the short term. So we have that perspective were right now.
It's going to take a little bit of time to get there at the same time day. There is some tension that exists because what was a liability and has been a liability force from a balance sheet perspective is also and some sense a great asset as you go into recovery.
And the leverage that we have and our properties, which is not replicable and bolt at it from a rate perspective, and LTV perspective that is something that is a benefit to us and.
And as we accelerate and to this recovery and so that is something that can benefit our shareholders.
EBITDA comes back.
But it is something that we're gonna have to chip away over time, and I think realistically it won't be we won't be able to address some of the leverage levels in earnest until we have probably paid off our friends over at Oaktree and and with the strategic financing that we have.
And then as we get into loan extensions that are occurring in 2023, 2024 that will be the moment, where it'll give us the ability to potentially pay offs or pay down some loans and reorganize them. So they make it a little bit more coherent sense in terms of what we're trying to do long term. So so right now we're we've been folk.
Just on Opportunistically hanging back.
Assets that we thought were uneconomic, we think by and large that process is done and I wouldn't expect as of now debt paying back anything else that's material to the platform. We've been focused on converting these preferreds to common and we think that's helpful. In terms of both removing the preferreds that are are senior to our common shareholders were moving those.
Building approvals.
And providing significant more equity flow that was a struggle that we had we think in previous cycles was our equity flow was too small.
Other way to to help solve that and.
So I think youre going to see it'll be a chipping away over time as we address leverage.
Okay. That's all from me thank you for the detail.
Our next question is from Bryan Maher with B Riley Securities. Please proceed.
Good morning, or I should say good afternoon, and thanks for those comments, thus far kind of sticking with the preferred to common exchanges.
It is the goal there to ultimately eliminate the preferreds I mean, we were a bit surprised to see that continue on and it and at a higher ratio kind of post the oaktree transaction can you elaborate a little bit more on what you do with the balance of the preferreds and and over what period of time.
Sure.
I think.
And the ideal would Brian I would like to get rid of all the preferreds.
I think it simplifies our capital structure.
And it removes fixed charges, which I think as we are looking at our total leverage on a go forward basis I am one and this is probably maybe a little difference between me and and Doug was that I do see preferreds as a more levered type structure and so those are ones.
And what I'm looking at our leverage levels and kind of look at debt to preferred to EBITDA. So I would like to remove them over time several of the several of those series are callable a dampening of five year. Non calls they are I think about three to five years or it will be callable by the end of this year and then the last one will be by the end of.
And next year, So I think the our game plan is to continue.
Continue to do these exchanges as we can strategically if it makes sense to reduce them reduce those accruals and then depending upon how the industry recovers, we'll see over time, if we want and either tender or or or call them and thats, obviously, a TBD as what happens over the next couple of years and and recovery.
Got it and then just on the cash trap conversation and I get it that the cash needs. This day, you know at the hotel level, but I am assuming that the cash is generated from the properties can go towards the debt to service those properties is that correct.
That is correct.
Yeah, that's correct.
And most of the loans, Brian or are they usually have tests that are somewhere around and usually kind of 1.2.
Right.
Coverage ratios are and kind of each loans, a little bit different but it's kind of a probably a decent estimate of when those loans would actually be able and it's usually over several months. So it's usually not a onetime cash that's over a rolling three months or over a quarter before you can actually extract those.
Extract that cash, but yes, you can use it for interest but the problem is as you may have certain assets that are covering their own pool.
Because their say and Florida, or Texas or certain geographies are more transient and then you have other assets like assets, and Boston or San Francisco or whatever and that are more urban that aren't able to but you can't transfer the cash over and so in it and obviously it makes it so that you've got additional cash needs coming from corporate debt.
We can't address quite yet.
Got it and with all the discussion and concern about.
Inflation, possibly you know rearing its head here this year and and I understand you know having covered the company for 18 years.
Goal of kind of having a more floating because you can kind of move revpar revpar would tend to move higher as things get better et cetera.
But given where we're at with interest rate currently and with the outlook for potential inflation is there an opportunity or a desire to shift a little bit more of a fixed from floating at this point.
I'd say a question I mean, it's something that we obviously look at it and are open to but as we've gone through numerous cycles and looked through and analyses on would you had been better swapping from floating to fixed that amount of time that that actually made sense and paid off over the next.
Five years or over the next term of your debt, it's very very rare.
And so so we tried to address that by putting caps in place, which we have on all of our floating rate debt to protect against any sort of hyper inflationary sort of scenario, but by and large as you know Brian inflation would be outstanding for us I mean that would be one of the best things that ever happened to us because.
And when you look back even back to the seventies, when you add hyperinflation scenarios.
Hotel rates kept kept pace and actually exceeded the increases in interest rates.
And so and then.
And I see us as a company that has higher leverage than we'd like to have over time that is a way to very quickly delever is to have your EBITDA and revenues grow at rapid rates. So I think inflation is welcome.
And if you from our perspective, yes, Brian This is Eric the other thing I would add to that is that.
Not only do we believe the floating rate provides a natural hedge to our cash flows but it also provides more flexibility.
Fixed rate debt tends to tie our hands a little bit more so we put some some value on that flexibility.
And so you know as <unk>.
Looked at the loans that we've done over my 18 ish years at Ashford.
I've never done a floating rate loans that I regretted doing but almost every time, we've done it fixed rate loans and I look back and wish we had done floating and we may be at this unique time.
Where rates do go up from here, a little bit better locking it in.
Which is something we're talking about but we also value that flexibility that we have and so that's something else that we take into account when we're thinking about these decisions.
Great and just last from me you know the Reddit crowd I'm sure you've noticed as kind of latched on to the Ashford Trust name.
And what's the best way to kind of take advantage of that.
Bose your maybe your enthusiasm for lack of a better term is it through.
Issuing through the Cedar or other ways I guess, you can't do the ATM right now when.
When you have rallies and the stock you know to kind of hit that debt and how quickly can you move on that.
Yeah. So good question I mean, we obviously have gotten some traction with retail shareholders and there's a lot of benefits that come from that and then obviously our trading volume has been significantly improved.
By the I'd say the tension from from the retail crowd and.
That I think is it could be a great benefit to our shareholders over time to be able to build positions and yard positions as needed.
They also and daily bring a certain amount of and enthusiasm that and enjoyable kind of be around.
And I think if you go through a lot of what has been said I think theres a lot of them. They have the rate perspective, which is over the medium or longer term debt. There is a a reopening play that is debt.
Trying to participate in and I mean, there's always going be some shareholders that are just in and out in a very short period of time and again that can at least accentuate volume, but I think the ones that that really are doing their due diligence and doing their work or looking at the longer reopening play and are here and how Ashford trust coming from a pretty difficult spot as we've been.
And then.
It is a real opportunity to participate in that.
How did you take.
Take advantage of it.
There's obviously a lot of things that can happen and I and I think the decisions that we'll make will be non.
Not dependent really upon the nature of our shareholder base, but what happens to our share price and what happens to the industry recovery, that's going to be the basis for us making decisions not to our shareholder bases at any one moment.
Got it thanks for the color.
As a reminder, just star one and your telephone keypad, if he would like to ask a question. Our next question is from Chris Blunt and Ranke with Deutsche Bank. Please proceed.
Hey, good morning, guys.
I think the original feeder agreement, maybe expires really soon and and I was curious as to whether you have any other kind of ATM or other equity issuance programs kind of in effect for the rest of this quarter right now.
Hey, Chris it's there so just to be clear the ceded that we put in place we have exhausted and we have raised the equity was allocated for that Cedar. We did have a second equity line that was put in place which has also been exhausted so.
Don't think we're ready to provide any comments in terms of what we could do next or what might happen from here, but I just wanted to clear that.
Everything that we have put out there at this point has been exhausted from an equity raise and standpoint.
Okay. Thanks, Thanks, there and.
I think as of March 31, the preferred balance was around $272 million is that.
Can we assume it's.
Still around there.
We continue to be active and opportunistic on exchange and the preferred for common. So we'll just we'll point you to the public comments that we've made but as Rob said as long as it makes sense and we're able to exchange those preferreds that are at a ratio that we believe works for our common shareholders and.
Is less and the par amount owed and.
And that's something that's a strategic initiative for us.
Okay.
That's fine and then just kind of a housekeeping is it possible to get a pro.
Pro forma 2019, EBITA and that reflects the asset sales or give backs you guys had bumped a day and the I guess, the where you think corporate run rate SG&A and advisory fees or can we get a ballpark number for that.
We could talk about providing the 2019 pro forma.
Total EBITDA, which.
And I'm not sure if that was in our deck and we published in April or not but just probably makes sense to refresh that number.
In terms of run rate for corporate costs.
And that's something that we that we have provided and I provided in my prepared remarks that from a corporate G&A and advisory standpoint.
And we believe the current run rate is about $4 million a month.
And for interest expense currently it's about $11 $4 million a month run.
Our run rate.
Okay.
Yeah, just to be clear, yes, Chris just to be clear that corporate G&A number I gave you includes base advisory fees.
Right right. Okay got you. Thanks there.
Okay.
Yeah.
We have reached and never a question and answer session and I'd like to turn the conference back over to management for closing remarks.
Alright. Thank you everyone for joining today's call and we look forward to speaking with you again next quarter.
Thank you. This does conclude today's conference you may disconnect. Your lines at this time and thank you for your participation.
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Yeah.