American Hotel Income Properties REIT LP announces Q2 2013 results and schedules conference call

VANCOUVER, Aug. 8, 2013 /PRNewswire/ - American Hotel Income Properties REIT LP ("AHIP") (Toronto Stock Exchange: HOT.UN; OTCQX: AHOTF) today announced the release of its financial results for the three and six months ended June 30, 2013.

2013 Q2 financial highlights and recent events

(All amounts expressed in US dollars unless otherwise indicated. Certain operating results of AHIP presented for the six month period ended June 30, 2013 reflect only the operational results for the 130-day period from the acquisition of Lodging Enterprises, LLC on February 20, 2013 to June 30, 2013.)

  • AHIP's current property portfolio was comprised of 32 hotels located in 19 states as at June 30, 2013, representing 2,564 available guest rooms under management of AHIP's external hotel manager, which experienced an 83.6% and 82.5% occupancy rate for the three and six months ended June 30, 2013 respectively.
  • Cash balance was $24,120,535 (excluding restricted cash) as at June 30, 2013.
  • Total revenues were $13,640,199 and $19,214,299 for the three and six months ended June 30, 2013, respectively, all of which was attributable to the operating results of Lodging Enterprises, LLC subsequent to the acquisition date of February 20, 2013.
  • Funds from operations ("FFO") were $2,606,034 ($0.250 per Unit) for the three months ended June 30, 2013.
  • Adjusted funds from operations ("AFFO") were $2,381,700 ($0.229 per Unit) for the three months ended June 30, 2013.
  • Net operating Income ("NOI") was $4,816,077 ($0.463 per Unit) for the three months ended June 30, 2013.
  • Distributions of $2,287,818 and $3,270,968 were declared during the three and six months ended June 30, 2013 respectively (both representing Cdn$0.90 per Unit on an annualized basis), of which $741,942 was included in accounts payable and accrued liabilities at June 30, 2013 and paid on July 15, 2013.
  • AFFO payout ratio was 96.1% (calculated as distributions declared divided by AFFO) for the three months ended June 30, 2013 which includes a significant amount of unutilized cash available for working capital and acquisitions.
  • Debt to gross book value was 43.4% (calculated as the principal debt outstanding of $71,455,954 divided by the sum of total assets of $166,819,916 less the deferred income tax asset of $1,994,524) at June 30, 2013.
  • On May 15, 2013, AHIP opened the newly-built 60-room Oak Tree Inn hotel located in Livonia, Louisiana, which followed closely after the January 2013 opening of the new 56-room Oak Tree Inn hotel and 24-hour Penny's Diner located in Glenwood, Minnesota (both hotels were included in the 32 initial properties as described in AHIP's final prospectus dated February 12, 2013).
  • On July 9, 2013, AHIP announced that its Board had approved a commitment with SunOne Developments Inc. to construct a 56-room oak Tree Inn Hotel and Penny's Diner located in Santa Teresa, New Mexico, secured by a long-term contract for all 56 rooms.
  • On July 19, 2013, a distribution of Cdn$0.075 per Unit was declared for the month of July 2013 (Cdn$0.90 per Unit on an annualized basis), for payment on August 15, 2013.
  • On July 22, 2013, AHIP announced that its Units commenced trading in the United States under the symbol "AHOTF" on the OTCQX International ("OTCQX") marketplace, a segment of the OTCQX marketplace reserved for non-U.S. companies that are listed on a qualified international exchange, undergo management reviews and provide their home country disclosure to U.S. investors.

"Following our February 20, 2013 IPO and the smooth transition of the management of our hotel assets to AHIP's external hotel manager, we have experienced two successive quarters of stable operating results that are in line with our expectations," said Mr. Rob O'Neill, Chief Executive Officer. "In addition to providing for the growth of our initial portfolio through an accretive acquisition program and participation in strategic development opportunities, we have continued to sharpen our focus on deploying AHIP's excess cash on an accretive basis through the acquisition of additional high quality economy and select service hotel assets in the US. Excluding the previously announced 56-room $5.1 million property at Santa Teresa, New Mexico, AHIP has four properties approximating $17 million under preliminary agreement for addition to its rail portfolio. In addition to an increasing volume of transactions coming onto the market, AHIP is actively pursuing high quality select service hotel portfolios totaling more than $100 million of acquisitions in its non-rail acquisition pipeline."

Mr. O'Neill further commented, "With the strengthening of average daily rates and occupancies to historic levels in the US Hotel Industry, AHIP's properties are well-positioned to benefit from this trend. Through accretive acquisitions and the expansion of our existing rail portfolio, we intend to capitalize on the growth in the US Hotel Industry and simultaneously utilize the substantial availability of low interest CMBS financing to provide high returns of equity to our stakeholders."

Conference Call

AHIP also announced the scheduling of its second quarter 2013 Financial Results Conference Call. Rob O'Neill, CEO and Robert Hibberd, CFO of AHIP will host a conference call at 8:00am (Eastern time) or 5:00am (Pacific time), on Friday August 9, 2013, to review the financial results and corporate developments for the three and six month period ended June 30, 2013.

To participate in this conference call, please dial one of the following numbers approximately ten minutes prior to the commencement of the call, and ask to join the AHIP conference call.

Dial in numbers: Toll Free ......................................................1-888-390-0546
International or Local Toronto......................1-416-764-8688

Conference Call Replay

If you cannot participate on August 9, 2013, a replay of the conference call will be available by dialing one of the following replay numbers. You will be able to dial in and listen to the conference two hours after the meeting end time, and the replay will be available until August 16, 2013.

Replay Dial-In: Toll Free ......................................................1-888-390-0541
International or Local Toronto......................1-416-764-8677

Please enter the replay PIN number 179687.

Non-IFRS Measures

Certain non-IFRS financial measures are included in this news release, which include debt to gross book value, funds from operations ("FFO"), adjusted funds from operations ("AFFO") and net operating income ("NOI"). These terms are not measures recognized under International Financial Reporting Standards ("IFRS") and do not have standardized meanings prescribed by IFRS. Real estate investment trusts often refer to FFO, AFFO and NOI as supplemental measures of performance and debt to gross book value as a supplemental measure of financial condition.

Debt to gross book value, FFO, AFFO and NOI should not be construed as alternatives to measurements determined in accordance with IFRS as indicators of AHIP's performance or financial condition. AHIP's method of calculating debt, gross book value, FFO, AFFO and NOI may differ from other issuers' methods and accordingly may not be comparable to measures used by other issuers. For further information, please refer to AHIP's Management's Discussion and Analysis dated August 8, 2013 which is available on SEDAR at www.sedar.com and on AHIP's website at www.ahipreit.com.

Forward-Looking Information

Certain statements in this press release may constitute "forward-looking" information that involves known and unknown risks, uncertainties and other factors, and it may cause actual results, performance or achievements or industry results, to be materially different from any future results, performance or achievements or industry results expressed or implied by such forward-looking information. Forward-looking information is identified by the use of terms and phrases such as "anticipate", "believe", "could", "estimate", "expect", "intend", "may", "plan", "predict", "project", "will", "would", and similar terms and phrases, including references to assumptions.

Forward-looking information contained in this press release is based on certain key expectations and assumptions made by AHIP, including, without limitation, expectations and assumptions respecting the amount of the expected monthly cash distributions and annual yield for the Units and the timing to pay such cash distributions to unitholders, and a reasonably stable North American economy and stock market. Although the forward-looking information contained in this press release is based upon what the AHIP's management believes to be reasonable assumptions, AHIP cannot assure investors that actual results will be consistent with such information. Forward-looking information reflects current expectations of management regarding future events and operating performance as of the date of this press release. Such information involves significant risks and uncertainties, should not be read as guarantees of future performance or results, and will not necessarily be accurate indications of whether or not such results will be achieved. A number of factors could cause actual results to differ materially from the results discussed in the forward-looking information, and a description of these factors can be found under "Risk Factors" in AHIP's final prospectus dated February 12, 2013 and Management's Discussion and Analysis dated August 8, 2013, which are available on SEDAR at www.sedar.com and on AHIP's website at www.ahipreit.com.

The forward-looking information contained herein is expressly qualified in its entirety by this cautionary statement. Forward-looking information reflects management's current beliefs and is based on information currently available to AHIP. The forward-looking information is made as of the date of this press release and AHIP assumes no obligation to update or revise such information to reflect new events or circumstances, except as may be required by applicable law

About American Hotel Income Properties REIT LP

AHIP is a limited partnership formed under the Limited Partnership Act (Ontario) to invest in hotel real estate properties located substantially in the United States and engaged primarily in the railroad employee accommodation, transportation, and contract-focused lodging sectors. AHIP's long-term objectives are to: (i) generate stable and growing cash distributions from hotel properties substantially in the US; (ii) enhance the value of its assets and maximize the long-term value of the hotel properties through active management; and (iii) expand its asset base and increase its AFFO per Unit through an accretive acquisition program, participation in strategic development opportunities and improvements to its properties through targeted value-added capital expenditure programs.

Additional information relating to AHIP, including AHIP's interim financial statements for the three and six months ended June 30, 2013, AHIP's Management's Discussion and Analysis dated August 8, 2013, and other public filings are available on SEDAR at www.sedar.com and on AHIP's website at www.ahipreit.com.

SOURCE American Hotel Income Properties REIT LP




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