Hersha Hospitality Trust (HT) 10-Q Quarterly Report Thu May 07 2020

-- Hersha Hospitality Trust (NYSE: HT) (“Hersha,” “Company,” “we” or “our”), owner of high-quality upscale and lifestyle hotels in urban gateway markets and resort destinations, today announced results for the first quarter ended March 31, 2020.

First Quarter 2020 Financial Results

Net loss applicable to common shareholders was approximately ($29.1 million), or ($0.76) per diluted common share, in the first quarter 2020, compared to net loss applicable to common shareholders of approximately ($13.0 million), or ($0.34) per diluted common share, in the first quarter 2019. In spite of a strong start, the decrease in first quarter 2020 net income and net income per diluted common share is largely due to the unprecedented impact on the travel industry from the COVID-19 pandemic.

AFFO in the first quarter 2020 decreased by $8.7 million, or 138.1%, to ($2.4 million), compared to $6.3 million in the first quarter 2019. AFFO per diluted common share and OP Unit in the first quarter 2020 was ($0.06). An explanation of certain non-GAAP financial measures used in this press release, including, among others, AFFO, as well as reconciliations of those non-GAAP financial measures, to GAAP net income, is included at the end of this press release.

Mr. Jay H. Shah, Hersha’s Chief Executive Officer, stated, “Since our last earnings report just over two months ago, the COVID-19 pandemic has delivered catastrophic impact on the lodging industry. The first two months of 2020 exceeded our high expectations for our portfolio, generating strong incremental EBITDA from the holistic renovations we undertook over the last few years, led by our two largest EBITDA-producing assets in South Florida. January and February gave us a glimpse of the profitability of our newly-aligned comparable portfolio, which grew RevPAR by 3.9% during that period. However, in March, the novel Coronavirus outbreak led to a near immediate shutdown in travel, resulting in an unimaginable impact to the lodging sector. The deep and pervasive effects led us to immediately pivot to a near-term operating strategy of curbing expenses and boosting our liquidity. In close alignment with our independent third-party management partners we implemented significant on property cost cuts in real time. We also made extensive corporate cost cuts expected to yield approximately 25% in savings in SG&A expenses on an annualized basis for 2020. At the hotel-level, the suspension of operations at 21 of our 48 hotels has resulted in an 80% reduction of on-property labor costs. Employing a select-service model at the majority of our assets, allows us to efficiently operate our hotels with a skeleton crew, leading to a significant reduction in expenses while also generating revenue through unique channels with medical personnel, government agencies, emergency first responders, and law enforcement.”

The following information was filed by Hersha Hospitality Trust (HT) on Wednesday, May 6, 2020 as an 8K 2.02 statement, which is an earnings press release pertaining to results of operations and financial condition. It may be helpful to assess the quality of management by comparing the information in the press release to the information in the accompanying 10-Q Quarterly Report statement of earnings and operation as management may choose to highlight particular information in the press release.

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Inside Hersha Hospitality Trust's 10-Q Quarterly Report:

Financial - Cash Flow Highlight
41 Table of Contents CASH FLOW ANALYSIS (dollars in thousands, except per share data) Comparison of the Three Months Ended March 31, 2020 and 2019 Net cash provided by operating activities decreased $2,399 from $6,002 for the three months ended March 31, 2019 to $3,603 for the comparable period in 2020.
Financial - Expense Highlight
This increase is mostly related to increased real estate tax that had been re-assessed by the applicable taxing authority, resulting in increases in real estate tax expense for the quarter as we had to cumulatively catch up, in certain instances, our estimated tax accruals at the time of the new assessment receipt during the quarter.
Financial - Cash Flow Highlight
The following items are the major contributing factors for the change in financing cash flows: A decrease in comparative cash flows as we drew $5,000 less on our line of credit during the three months ended March 31, 2020 when compared to the same period in 2019.
Financial - Shares Highlight
We expect that future investments in hotels will depend upon and will be financed by, in whole or in part, our existing cash, the proceeds from additional issuances of common or preferred shares, proceeds from the sale of assets, issuances of Common Units, issuances of preferred units or other securities or borrowings secured by hotel assets and under our Line of Credit.
Financial - Shares
Statements regarding the following subjects...Read more
Revenue - Product
Management expects hotel operating revenues...Read more
Other - Other
Spending on capital improvements during...Read more
Financial - Earnings
These assessments have a direct...Read more
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Forward-looking statements speak only as...Read more
Financial - Cash Flow
An increase in comparative cash...Read more
Financial - Shares
Net Loss Applicable to Common...Read more
Financial - Income
These estimates consider factors such...Read more
Other - Other
We typically experience increases in...Read more
Financial - Expense
Additionally, we experienced increases in...Read more
Financial - Cash Flow
A decrease in comparative cash...Read more
Other - Other
These capital expenditures were undertaken...Read more
Financial - Cash Flow
A decrease in comparative cash...Read more
Other - Other
Readers should specifically consider the...Read more
Other - Other
Depreciation is computed using the...Read more
Financial - Cash Flow
The following items are the...Read more
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We determined that the loss...Read more
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In particular, it is difficult...Read more
Financial - Earnings
The White Paper defines FFO...Read more
Other - Other
The provisions of this update...Read more
Financial - Expense
Expenses Total hotel operating expenses...Read more
Other - Other
Improvements and replacements are capitalized...Read more
Financial - Debt
Our ability to raise funds...Read more
Financial - Income
38 Table of Contents Income...Read more
Financial - Earnings
The GAAP measure that we...Read more
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Each of these TRS entities...Read more
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One of the most significant...Read more
Financial - Dividend
Our Board of Trustees continues...Read more
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This distribution requirement limits our...Read more
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Interest Expense Interest expense increased...Read more
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OVERVIEW At the beginning of...Read more
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36 Table of Contents As...Read more
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We show both FFO from...Read more
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Financial Statements, Disclosures and Schedules

Inside this 10-Q Quarterly Report

Material Contracts, Statements, Certifications & more

Hersha Hospitality Trust provided additional information to their SEC Filing as exhibits

Exhibit 31.1: Rule 13A-14(A)/15D-14(A) Certification

Exhibit 31.2: Rule 13A-14(A)/15D-14(A) Certification

Exhibit 32.1: Section 1350 Certification

Exhibit 32.2: Section 1350 Certification

Ticker: HT
CIK: 1063344
Form Type: 10-Q Quarterly Report
Accession Number: 0001063344-20-000139
Submitted to the SEC: Thu May 07 2020 5:28:58 PM EST
Accepted by the SEC: Thu May 07 2020
Period: Tuesday, March 31, 2020
Industry: Real Estate Investment Trusts

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Hersha Hospitality Trust (HT) SEC Filing 10-Q Quarterly report for the period ending Tuesday, March 31, 2020

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