Q1 2021 Ashford Inc Earnings Call
Greetings and welcome to Ashford, Inc. First quarter 2021 results conference call.
At this time all participants are in a listen only mode.
The question and answer session will follow the formal presentation. If anyone should require operator assistance. During the conference. Please press star zero on your telephone keypad as the.
A reminder of this conference is being recorded it is now my pleasure to introduce your host Jordan Jennings Investor of Investor Relations for Ashford, Inc. Thank you you may begin.
Good day, everyone and welcome to today's conference call to review of results for Ashford for the first quarter of 2021 and to update you on recent developments on.
On the call today will be Jeremy Welter, President and Chief operating Officer, Derek Eubanks, Chief Financial Officer, and Aerospace and managing director and senior Vice President of portfolio management.
The results as well as notice of the accessibility of this conference call on a listen only basis over the Internet were distributed yesterday and a press release.
At this time of let 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, such forward 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 looking statements included in this conference call are only made as of the day of this call and the company is not obligated to publicly update or revise them and in addition, certain terms used in the call our non-GAAP financial measures reconciliations of which are provide.
And the accompanying the earnings release and accompanying tables or schedules, which have been filed on form 8-K with the SEC on May five 2021 and May also be accessed through the company's website at Www Dot Ashford, Inc. Dot com each listener hours and encourage to review those reconciliations provided in the earnings release together.
With all other information provided in the release also unless otherwise stated all of our reported results discussed in this call compare the first quarter of 2021 and with the first quarter of 2020, I will now turn the call over to Jeremy.
Good morning, and welcome to our call to discuss our financial results for the first quarter of 2021.
I will begin by discussing the Ashford has operations and strategy.
Derek will then review our financial results for the quarter and and Eric will provide an update regarding our products and services businesses. After that we will open it up for Q&A.
I want to begin by thanking our associates for the relentless hard work during this unprecedented time.
And I can't tell you how proud I am.
Of our executive leadership team as well as our associates throughout the country.
It's been the long year for those of us and the hostile the industry.
We are now seeing demand come back and the recovery is here as we look forward I am extremely optimistic about the future of our company.
The key themes, we are going to highlight today are we stabilized Ashford trust and secure the ample liquidity for that platform with years of runway, while the braemar and portfolio has already gotten back to cash flow positive at the corporate level.
We are already seeing strong results and our third party growth initiative.
We are ramping up our efforts at Ashford Securities.
And we have a comprehensive asset like business that is unique and ops, the hospitality industry and well positioned for growth going forward.
Yeah.
We believe the continued positive news around vaccine development and distribution has created optimism for our industry and.
And we're starting to see positive trends and our operating result.
Ashford advisers and two publicly traded REIT platforms, Ashford Trust, and Braemar, which together owned 115 hotels with approximately 26000 rooms, and approximately $7 $3 billion of gross assets as of March 31 2021.
Braemar is currently benefiting from its focus on the luxury segment and specifically its luxury resorts.
Which have been the first four properties to recover.
During the quarter Ashford Trust closed a $450 million strategic corporate financing.
And it provides multiple years of liquidity.
Both of <unk> platforms now have ample liquidity.
Looking forward with both rate stabilized and performing well, we believe both are well positioned for the recovery of the hotel industry and we remain focused on their future strategic objectives.
Remicade and Premier and continued to execute on their long term growth strategies.
Both companies are benefiting from the improved demand trends, we are seeing at our hotels and we continue to believe that these two businesses are well positioned to achieve growth with the third party business initiatives.
Well, the Remington and Premier has solid reputations and neither has historically focused on third party business.
And we're still in the early stages of this effort, but we already.
And we've already seen strong momentum with Remington signing seven New hotel management contracts with third party hotel owners and Premier signing 15, New third party contracts.
Looking ahead, we are extremely excited about the long term opportunity for third party growth at both Remington and Premier.
We formed Ashford Securities and 2019 to be of dedicated platform to raise retail capital through financial intermediaries and the broker dealer channel in order to grow our existing and future platforms.
Our goal for Ashford Securities is to provide the market with highly differentiated alternative investment products types of capital range may include but are not limited to non traded preferred equity non traded convertible preferred equity and non traded REIT common equity for future platforms.
Ashford Securities is ramping up nicely and we anticipate beginning fundraising sometime this year.
We're excited to pursue a fresh source of capital that will help us grow all of our platforms over the long term.
And all with the goal of increasing shareholder value.
One of the businesses, where we're seeing strong growth as red hospitality great.
Great hospitality and leisure is a leading provider of watersports activities and other travel and transportation services and the U S Virgin Islands, and and key West Florida.
And the gas or seeking automatic chickens, allowing them to bypass the front desk with keyless entry and secured digital key capabilities.
The industry is also seeking enhance sanitation and air purification standards within the guest rooms, we believe the benefits the open key and pier wellness offer will position them well to achieve accelerated adoption and growth of our hotels nationwide.
Looking ahead, we believe we have a superior strategy and structure that is unique within the hospitality space.
We're starting to see the recovery and our industry and we're also seeing investment opportunities of very attractive Unlevered returned.
That we do not see pre pandemic.
There are four of waste our business can grow from here.
The recovery of the hostile and the industry and higher hotel revenues.
And increase and our assets and the management.
Growth over a third party business and the acquisition incubation of.
Additional businesses.
For investors seeking exposure to and industry significantly impacted by the pandemic, we believe Ashford is and attractive option and.
In fact, and the company of weeks, we plan to publish and Investor presentation that outlines the growth prospects, we see for our businesses over the coming years.
We believe the growth story for Ashford is compelling and look forward to share of perspective with investors.
I will now turn the call over the Derek Thanks, Jeremy net loss attributable the common stockholders for the first quarter was $17 $1 million adjusted EBITDA for the first quarter was five $5 million and adjusted net income for the first quarter was for $8 million.
Adjusted net income per share for the first quarter was 65 sets and.
In terms of financial results for our portfolio of companies I'll provide some highlights of and Eric will discuss more details.
During the quarter Ashford Trust completed of $450 million strategic corporate financing drawing $200 million.
Ashford Trust is also continued to make significant progress and converting is preferred stock and the common stock and has exchanged approximately 13 million shares of its preferred stock representing approximately 58% of the share count prior to the exchanges and two approximately 85 million shares of common stock also during the first quarter and subsequent to the end of the car.
Porter Ashford Trust raised approximately $89 million from the sale of shares of it's common stock Braemar also raised equity capital of approximately 26 $4 billion from the sale of shares of it's common stock during the first quarter and subsequent to the end of the quarter.
<unk> is also exchanged some of its preferred stock for common stock to date Braemar has exchanged approximately 1.2 million shares of its preferred stock representing approximately 19% of the share count prior to the exchanges and.
And two approximately four 5 million shares of common stock.
These capital raises and exchanges have helped sure of both Rhys liquidity and lower the leverage list.
Lismore recorded revenue of four $3 million and the quarter related the it's agreements with Ashford Trust and Braemar to seek modifications and forbearance for the reef debt. This forbearance effort is mostly completed the Lismore will continue to record. This revenue over the remaining term of the agreement, which expires in April of 2022.
Remington realized hotel management fee revenue of four $5 million and the quarter net loss attributable to the company of $2.2 million and adjusted EBITDA of $1.5 million.
For the first quarter Premier had project management fee revenue of $1.5 million net loss attributable to the company of $2.4 million and adjusted EBITDA of negative point $1 million.
Open key finished the quarter with 236 hotels under contract.
This growth was driven by a significant shift and guests preferences with utilization of digital keys, increasing by of 118% and the first quarter over the prior year quarter with the majority of guests from January through March opting to use the digital key when offer.
Financial results for GSA V for the first quarter included revenue of three $6 million net income attributable to the company of zero point $3 million and adjusted EBITDA of negative $1.4 million.
As of March 31st 2021, we had seven 3 million fully diluted shares of common stock and units, which included four 2 million common shares associated with our series the convertible preferred stock. We had two 7 million common shares issued an outstanding.
0.2 million common shares earmarked per issuance under our deferred compensation plan and the balance relates to some restricted stock.
I will now turn the call over to Eric.
Thank you there we are excited to give and update on our products and services businesses and they are impressive starts of the year. There are many positive takeaways from the first quarter, including record performances third party business generation from new sales personnel and penetration into new markets with massive opportunity.
We will spend most of our time talking about the corner of the whole, but it is worth noting the momentum we are experiencing within the quarter itself cute.
Cumulative March revenue was over 40% higher than the average of January and February the momentum is palpable and growing each week.
Associates across our platforms continue to do and incredible job and the first quarter provided the jumpstart to the significant recovery, we expect and 2021.
Our focus has been shifted to growth mode as our businesses aggressively pursue new business and higher on a daily basis to support increasing demand.
As a reminder, our core strategies to invest and market, leading businesses with talented management teams and growth opportunities supported by attractive macro dynamics.
Through of Multipronged approach, we aim to accelerate growth and create shareholder value through rigorous industry research the implementation of best operating practices and the execution of bolt on acquisitions.
We are also able to utilize our extensive relationships and refer these businesses to our advised roots and sharing their hotels received world-class service with attractive pricing.
The first business I would like to discuss is red hospitality and leisure of leading provider of watersports activities and other travel services and the U S Virgin Islands and key west.
Red had the best months and the history of the company and March in terms of revenue and EBITDA.
With the expectations for a strong second quarter as tourism activity and Reds markets remains high we would like to congratulate and thank CEO, Chris Bachelor and his team for an amazing start to the year Red has and exciting future with several near term organic and inorganic growth initiatives and we look forward to keeping you updated on their progress.
Another business the continues to grow as open key which provides Bluetooth enabled block upgrade modules. These modules her added to existing locks and a fraction of the cost of replacing an entire system saving their clients' money, while satisfying guest demand for a contact let's check and experience.
While open keys operating metrics continue to be strong. We also have some major developments to announce as we mentioned on our last call open key signed a masters services agreement with the major hotel brand and the fourth quarter.
This agreement makes open key the preferred provider of mobile room P hardware and services for the brands more than 9000 properties worldwide.
The agreement is and the pilot phase and we look forward to being able to provide more details on this MSA and future quarters.
The second major announcements and that open. He has also recently signed a masters services agreement with four seasons hotels and resorts to be their preferred provider of mobile key room mobile room key services.
Four seasons as one of the most well known luxury hotel brands worldwide. We're excited about these recent developments that open key and look forward to sharing more details and future quarters.
Remington as of dynamics Hotel management company, and providing best and cost service and expertise to hotels across the country.
Hotel operations continue to ramp and to satisfy demand Remington has rehired nearly half of its previously furloughed employees with more than 375 current job openings.
CEO Sloan Dean and his team were awarded to verbal and one signed third party management agreement and the first quarter two of which are expected to begin soon.
We expect a robust 2021 and recovery for Remington as they focus on adding new third party contracts to their roster of 79 hotels across 15 brand and 23 States and Washington D C.
From here and provides comprehensive and cost effective design development architecture procurement and project management services the.
The company continues to add staff in order to support its growth efforts, including the addition of two new sales leaders and January.
The Premier is doing a fantastic job with its recent initiatives to penetrate the large and growing multifamily market, which meaningfully expands the scope of opportunities available to it. In addition to his hotel project management business.
From your 2021 has been highlighted by one new multifamily contract and three new hospitality contracts totaling $2.3 million of fees.
With its two new sales leaders and of focus on penetrating the large multifamily market, we anticipate strong performance from premier as capital investment rebounds.
J as savvy as of leading single source solution for meeting and event needs with and integrated suite of audio visual services, including show and events services hospitality services creative services and design and integration.
CEO, Chuck boom and and his team have done a tremendous job navigating a difficult here.
In response to slower business travel over the last year, just GSV proactively shifted its focus the virtual meetings and successfully established numerous virtual showrooms across the country.
These virtual events or augmenting and already growing pipeline as J savvy aggressively pursues and house hotel Avi contracts alongside and this virtual meetings.
The month of March generated $1.5 million of revenue, which is more than of 60% increase over the previous 11 month average.
<unk> was verbally awarded to new contracts and we expect momentum to continue with group business travel picking up.
Pure wellness provides wellness applications designed to eliminate viruses bacteria and other contaminants within guestrooms offices and public spaces.
Here's the first quarter is highlighted by 13, new contracts added to its recently launched pier office of technology.
This technology uses advanced service protection and purified air to eliminate and 90, 999% of contaminants.
Employees are increasingly returning to their offices and pier office will give employers and employees of like comfort and returning to of safe and healthy workplace.
Lastly, I'd like to discuss Ashford Securities R retail capital of raising platform J.
J Steigerwald and his team continue to build out the organization with first quarter hires of two national account executives as well as senior operations and compliance personnel.
Ashford Securities is continuing to make progress on <unk> non traded perpetual preferred security and recently updated the offering documents through and amended as three filing.
The company and launched its broker dealers sign up effort and April and expects sales efforts to continue ramping through the second quarter.
We continue to believe there is a substantial opportunity for Ashford securities to offer differentiated products structures and strategies to retail investors and short we're excited to pursue of fresh source of retail capital that will help us grow all of our platforms over the long term with the goal of increasing shareholder value.
And that concludes our prepared remarks, and we will now open up the call for Q&A.
Thank you, ladies and gentlemen, and at this time, we will be conducting of question and answer session. If you'd like to ask you. A question you may price store one on your telephone keypad. The confirmation total of indicate your line is and the question queue. You may price store too if you would like to remove your question from the queue.
Four participants, who the speaker equipment, and maybe necessary to pick up your handset before pressing the store cake.
Our first question comes from the line of Tyler Batori with Jenny Capital markets. Please proceed with your question.
Good morning, and thank you.
Just a couple of questions for me here and there.
Most progress I think that you're moving on the third party business with Remington and Premier just interested how 'bout has gone from your expectations and and you think of there are more opportunities and you had originally anticipated to grow and <unk>.
Third parties Donaldson shapes, Gibbons and potential disruptions out there from the pandemic.
Yeah. This is this is Jeremy appreciate it Tyler.
And I would say that I'd say, the probably like if you could go back when we bought.
Remington and then Bob Premier I think we would of.
Thought the as we stand the day that we'd be maybe further along in and our third party developments, but that was.
Largely driven because of the pandemic, obviously, they're just what happens with the with third party property management is it transactions definitely stimulate more opportunity to.
To gain more contracts and they are just haven't been that many transactions but.
But I do believe that given just recent developments that were were already at seven hotels, which is a decent percentage of our total portfolio as we stand today.
I think we're proud of what we've accomplished recently and we're very optimistic of what we see going forward of and we've got a very robust pipeline I think we've got incredible business development team over Remington and.
Probably as good of leadership as anyone else would have flown.
Flown so I do I do think that it is and initiative that will be proved to be very successful as we look of baby and in another couple of years and look back and and I'd be very and.
I'm very optimistic and what we think we can achieve over of Remington and.
And the second part of it is premier.
And Premier I think I think if we were to sit down as the management team and say, where we think we might and have the most opportunity and we can make an argument for each one of our businesses by the way, but I think premier a lot of times wins that argument and just because it's such a fragmented.
The landscape and.
And there's there's a tremendous amount of market share that the premier would be able to gain with just a little bit of business.
And so.
We've gained I think I think we reported that we're up to 15 contracts and I think our first contract. If I recall was March of 2020.
And so I think we've been very pleased with our progress and premier through the pandemic and one of those things of that we don't have to just play and hospitality as of mentioned in previous quarters that there is a strong demand for our services and multifamily and so we've always looked at our market share when we when we bought premier to.
B and opportunity within the hostile our sector, but then when you expanded the other forms of real estate.
It's just a huge market potential and.
And I do believe that you can make a.
A.
And argument that within each one of the the verticals within within Premier, which is design and architecture and the purchasing and and project management construction management.
Corporate engineering, we have some of the best service providers with each one of those landscapes and so it is a very unique offering and and we're excited too.
To see the potential growth that we've got I'm very optimistic and we have the right leadership and we've just just created really of business development effort.
We brought on to folks and January of this year. So most of our business that we are able to get was with the with.
Without.
<unk> and so.
And one of the other things that were seen as well as the new recent development of that we've got some big transactions that that they're doing and.
And we're getting.
Recurring business from from those owners and.
And so there's there's one ownership group that we're talking about a third renovation now already and it's a nice nice size project all three of them and so and so there's just so many different ways that we can grow with each within each one of these businesses.
And the good news is and this is something that we're going to highlight with you guys going forward and.
And our optimism of our platform is it even if we don't get their part of growth the Remington and Premier and.
And we just get back to 2019 levels.
There is a pretty compelling and investment opportunity, we believe with Ashford ink and so when you add the the potential of the third part of growth on top of it.
We're very excited about our prospects.
A lot of investors and some of your peers really understand fully what this business is but I think of it.
Agree that it is a pretty unique and luxury experience that we offer and the US Virgin Islands and would you agree with that yes.
Yes, absolutely I think also Chris.
The great personal behalf and his role in terms of not only of operations, but certainly you know expansion for the for the business as well well I appreciate that Chris is not only are an important part of our team and leadership, but he is he's developed the to be a good friend of mine as well and and he just is fantastic and and so.
And I think what we have with Red is what we have with Remington and and Premier as it we can go into any market certainly in the U S.
And and and and compete and win we've we've already proven that because we we entered in the key west and bought the bagel and we utilized our best practices to really transform the company.
And it wildly accretive acquisition and if you look at March I think that was the most profitable month on record and rich history and key west history, its Tobago and so.
We just we're just very optimistic of what we can do and.
The market and it's not just it's not just limited the boating, it's our concierge services as well, which I think is a really unique offering and.
And it's unique in that and.
And the U S Virgin Islands.
<unk> is a very.
Yes, hi impact touch point, and Ritz Carlton and as you know does not like the outsource anything if they don't have to because they want to have control over all of the guest interactions.
But the red overseas Concierge services at the risk Carlton and St Thomas and they do and a fantastic job and it's just a great business model for us because you get commissions.
Everything you refer out and it just gives you the ability to kind of be the the initial touch point for all different types of.
And it'll be the same thing that we offer essentially at the Ritz St Thomas, but even more so because that will be will be overseeing the cabana sales as well. So I think theres a lot of markets certainly domestically and the U S. But then also and the Caribbean.
Okay excellent and the last question from me.
And when we look at the recovery playing out over the next couple of quarters years here just help us think about your various products and services businesses.
Which do you think are poised to return to 2019 levels first versus others and I know you can't give specific guidance or numbers around that but just curious your thoughts in terms of which of those businesses could quote unquote returned to normal first.
Yes, I'm, just writing them out on a piece of paper and I'll talk through each one of them. So just give me a second here and to do this.
Okay, So let's start with the <unk>.
I think we're going to exceed 2019 levels. This year and I think that's gonna be open key and red are going to do that so that's fantastic news.
And so we're very optimistic about those two platforms and.
And and there are a lot of accretive acquisitions that we have at Red and also vertical integration that we have that have high cash on cash returns.
I think that we're already there on a couple of businesses and we will continue to see great growth and both of those businesses.
Premier is going to be a little bit slower to rebound because of the the.
The capital spend that we've cut at the at the Reits, but.
As we ramp back up to 2019 levels.
And from a from a hotel revenue perspective, we should be.
Exceeding profitability of Premier I would hope because of our third party efforts. So just go back to of 2019 level.
The Premier, which basically only had two customers at that time.
You fast forward and you say the recoveries can be and 2023 of 2024 whenever and wherever you believe is as the equity analysts I think the premier should be hopefully greater than the than where we stood in 2019.
Remington St case, because again the third party efforts.
And that they should exceed.
Hopefully.
Profitability once we get back to a steady state within the within the industry and we have some opportunities there.
Continue to deploy some capital to continue to get more contracts.
And then potentially there are some management companies because of the pandemic. The if we wanted to acquire it may make sense to do that.
And then you've got the JCB and that's clearly going to be the one that's kind of lag. So it's hotels get back to 2019 numbers and <unk>.
And the meetings are going to lag debt.
Because it's just going to be maybe probably another year or so after 2019 numbers that we're back to where we should be from a group of meetings perspective, thats hard to know because we do see a lot of pent up demand.
And in the group business, but we definitely think it's going to recover a little bit slowly, but what I would argue against that from a growth perspective is the <unk>.
And is our largest third party business that we've got most of its business is outside of Ashford and.
And I think we have an incredible team there.
Both from a sales effort and the leadership effort across the board that I believe will continue to grow that business outside of Ashford and so we don't necessarily need the the hotel industry to recover to previous levels.
To see outsized growth of that platform because.
And because we will pick up new contracts, we will grow outside of the Ashford and I think it could be maybe maybe maybe the highest growth potential on a third party basis and.
And what I would say is you can look back again to 2020 and and the numbers we posted in January and February of.
<unk> 2020 late in the cycle and how much growth yesterday had I believe off top my head and I don't quote me on this but you can go back and look I think it was north of 70% year over year EBIT growth and.
And in January and February I don't know that we necessarily reported that because March obviously dipso low, but we were just very optimistic of what we're doing from a growth perspective, and and you saw that as well because we bought it and I think it was like $4 $5 million of EBITDA, We believe pro forma EBITDA for 2020, probably would've been closer to <unk>.
$14 million so within a short period of time, we were looking to basically tripled the growth of that company. So I think all of them and you make a case that they're going to have outsized growth.
Eric the other thing I think we should point out is that if you look at our 2019 actual results, we reported $38 million of adjusted EBITDA in 2019.
But that only included about two months of Remington because we closed on the really the transaction November of 2019, and so that does not include about $20 million of of.
Remington EBITDA that would be pro forma that they would of had prior to the closing of that acquisition. So if you look at our 2019 results and really have to look at it pro forma for having Remington because we do not have it for the entire year, which would add about $20 million to our <unk>.
The reported 2019 results.
Okay very good detail.
All of that that's all from me. Thank you.
As a reminder, ladies and gentlemen of the star one to ask a question. The next question comes from the line of Bryan Maher with B. Riley. Please proceed with your question.
Good afternoon, so not much left after after that but I got a couple.
Can you clarify a little unclear the us maybe we're just missing on open key and it.
Wire and the non redeemable non controlling interest is.
Is your position now at the 75 percentage of hires and the 100% what is the ownership stake of Ashford, Inc. Now and open gate.
75% Brian.
And.
And the four seasons deal does that span all of the four seasons hotels globally.
I believe it does I want to I want to get back to the one that is just the new recent development, but but yeah. It's it's a it's a big opportunity for open case.
Okay, and then labor costs, we continue to hear this across all of our covered.
You know with the extended and enhanced unemployment benefits that the government's doling out what what are you seeing as it relates to you know kind of re onboarding furloughed employees over the past year, you know how difficult has that been for you know Ashford and Remington.
And it's been difficult, it's definitely a challenge and.
It's a and it's definitely been difficult to get people back to work and certainly in certain markets. So it's been a struggle at Remington.
It's actually been of struggled for red, particularly in key west just access to labor.
Has been difficult and you you wouldn't think that would be the case given.
Just the the general state of the economy and unemployment rate, but it's just because the the the.
Premium unemployment benefits that were put in by our government.
We have created the wrong incentives for folks to come back to work. Unfortunately, so it's something we're dealing with it. It's just some of them will have to continue to deal with we've been very creative on how we can.
And can access labor.
And we're hopeful this is only a short term issue. Unfortunately, just it is of little draining for our teams Bryan.
And at all levels, because they've been through so much over the course last year. The you know the management teams of supervisors and and any of the players are already working.
They're doing more with less resources, and we want to address that as quickly as possible, but our hands are tied a little bit until September or October of this year, but hopefully like I said the short term issue.
But but the only positive thing I've said is that we've really dissected all of our businesses each one of them at a very granular level.
And so not only once we once we do get to the appropriate staffing levels those appropriate staffing levels will be at a level, we believe lower than what they were pre pandemic because of a lot of efficiencies we have the.
We've uncovered as a part of.
And they basically being force to.
Through the through through the challenges we had over the last year and so hopefully there'll be some good good.
Long term benefits from it.
Great and then just last from me.
And and I would say that we had been truly impressed by J S a and b.
Post the acquisition and that the grew through and into the first quarter of last year.
So that has the had been really painful and given its importance and ability to do pretty dramatic revenue and EBITDA numbers I heard your comments to pile on.
Going to lag, but what is the pulse of the market that you're hearing be of J S. A and b to.
Get that business ramped are there any early shoots out there that we should be thinking about and how much of a lag do you think it is maybe is measured in quarters two of decent return of business transient.
Yeah, I'll I'll take that and then if Eric has anything he'll he'll comment on as well, but I and we stay right here listen the team we've put them through Hell I mean, it's been it's been terrible what the team has had to go through I mean, we I think we went from 500 associates and out of 38 and of course of of weak and that wasn't announced and we went down and the next week or so down.
And the 26 I mean, it was just it was crazy and that was in March and it was definitely of the business that was.
The strongest right before the pandemic and and and then certainly the the most challenged and weakest during the pandemic, but but I can tell you that I'm incredibly proud of that acquisition as we stand today I'm incredibly proud of the leadership, we've put in place I would love it.
To be able to showcase them and you know.
Future and best Investor Day, because it's just incredible incredible leadership and we've got within that organization and and they've got a really good competitive advantage I think going forward because.
It's a great team and Theres, great growth prospects, but youre right. It will it will lag the.
The the transient for sure I don't know if we're talking.
And it's certainly not months, it's going to be quarters, and if not maybe maybe a year or so until.
Until it gets back to where.
It gets back to pre pandemic levels versus versus transient demand.
But but we are very optimistic and the green shoots we're seeing is that I actually for that for that one of our businesses actually approve weekly payables and the company.
We just have been very tight on cash flow with the JCB and I asked them to give me a week over week change and and revenue.
And over the course, maybe the last probably six weeks is when it turned because every every time I would see the week over week change revenue is falling out of our pipeline and we do of probability adjusted of what we think revenue is going be from the next.
Four quarters.
So in the quarter of the next quarter and then the next two quarters and but over the last six week every single week, we're adding more and more revenue to our pipeline, which is fantastic and so and.
And that's a forecast of pipeline. So our forecast continue to go up week over week. So there definitely is green shoots it's still going to be a little bit more of a walk before you run.
But again because of the competitive landscape, we do believe that business will grow.
<unk>, whether or not the the hotel industry grows.
Because we think we've got a really good offering there and we've proven it.
Yes. This is Erik and one thing I'll add is we've talked a little bit about the growth.
And March and Jeremy is mentioning some of the pipeline growth.
One of the interesting things that we're seeing.
We've talked to you guys about virtual meetings, and then potentially having hybrid meetings, where folks are getting in person and then having the hybrid component, but one thing that we started now seeing is that as groups come back, which they really want to do in person meetings. The show size is actually larger for GSV and many of these cases and otherwise would've been.
Because thats a group of 100 comes back they're actually renting more space because they want to practice, social distancing, which leads to more speakers more screens more projectors and so the show cost actually and the short term might be higher than it was prior.
And so there are opportunities for us to catch back up to those pre COVID-19 levels.
By increasing our per show cost for expanded offerings, both hybrid and then additional space of additional needs because of the social distancing.
Well the thing I'll add to Brian just give you a little bit more clarity because when we went through we restructured that loan and I think it was of a great restructure and by the way by the team, but we really went through a lot of of our own diligence and.
And and and we went through to understand even our per group size and are.
Our revenue per per group.
We were surprised of the bread and butter of JV is not your big events. They certainly have the ability to do that and they do it really well, but at our hotel our hospitality segment. It's a lot of the small board meetings are small groups and Youre talking protectors Youre talking.
Just rent and rentals for per screens and set up and so that I think is actually a good a great thing for us because that the the small small means you can come back a lot more quickly and then the larger groups, but we were surprised to the.
See that our bread and butter is actually much smaller on a per group base system and what we would've thought.
Great. Thanks, that's all from me.
Yes.
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