AHT Ashford Hospitality Trust Inc

Ashford Hospitality Trust, Inc. (NYSE:AHT) today reported the following results and performance measures for the second quarter ended June 30, 2007. The proforma performance measurements for Occupancy, Average Daily Rate (ADR), revenue per available room (RevPAR), and Hotel Operating Profit (or Hotel EBITDA) include the Company's 118 hotels owned as of June 30, 2007, which excludes 3 hotel assets held for sale as of that date. Unless otherwise stated, all reported results compare the second quarter ended June 30, 2007 with the second quarter ended June 30, 2006. The reconciliation of non-GAAP financial measures is included in the financial tables accompanying this press release. FINANCIAL HIGHLIGHTS Total revenue increased 205% to $350.3 million from $114.8 million Net income available to common shareholders increased 69% to $14.1 million compared with $8.3 million in the prior-year quarter Adjusted funds from operations (AFFO), not including gain on sale, increased 126% to $56.5 million, or $0.44 per diluted share compared with $0.34 per diluted share in the prior-year quarter Cash available for distribution (CAD) increased 100% to $45.4 million, or $0.35 per diluted share compared with $0.31 per diluted share in the prior-year quarter Declared quarterly common dividend of $0.21 per diluted share CAD dividend coverage was 167% for the quarter STRONG INTERNAL GROWTH Proforma RevPAR increased 6.5% for hotels not under renovation on a 5.9% increase in ADR to $140.72 and a 41-basis point improvement in occupancy Proforma RevPAR increased 5.8% for all hotels on a 5.8% increase in ADR to $141.28 and a 3-basis point improvement in occupancy Proforma same-property Hotel Operating Profit for hotels not under renovation improved 8.7% Proforma same-property Hotel Operating Profit margin for hotels not under renovation improved 73 basis points CAPITAL RECYCLING AND ASSET ALLOCATION Capex invested in the second quarter totaled $25 million Capex for 2007 and 2008 estimated at $280 million for which the Company has adequate resources to fund 11 hotels and one office building sold in the second quarter for $115.8 million PORTFOLIO REVPAR GROWTH As of June 30, 2007, the Company had a portfolio of direct hotel investments consisting of 118 properties classified in continuing operations. During the second quarter, 114 of the hotels included in continuing operations were not under renovation. The Company believes reporting its operating metrics for continuing operations on a proforma total basis (all 118 hotels) and proforma not-under-renovation basis (114 hotels) is a measure that reflects a meaningful and more focused comparison of the operating results in its direct hotel portfolio. The Company's reporting by region and brand includes the results of all 118 hotels. Details of each category are provided in the tables attached to this release. RevPAR growth by region was led by: West South Central (12 hotels) with a 14.5% increase; Middle Atlantic (10) with 10.0%; Pacific (23) with 8.3%; West North Central (4) with 6.0%; Mountain (8) with 4.3%; East North Central (10) with 4.2%; South Atlantic (43) with 3.2%; New England (4) with 2.5%; East South Central (3) with a 0.9% decrease; and Canada (1) with a 11.1% decrease. RevPAR growth by brand was led by: InterContinental (2 hotels) with 9.9%; Hilton (38 hotels) with 8.2%; Starwood (6) with 7.1%; Hyatt (5) with 4.7%; Marriott (62) with 4.7%; Radisson (3) with a 6.3% decrease; and independents (2) with a 12.8% decrease. HOTEL EBITDA MARGINS AND QUARTERLY SEASONALITY TRENDS For the 114 hotels as of June 30, 2007 that were not under renovation, Proforma Hotel EBITDA (adjusted as if all hotels were included throughout both periods) increased 8.7% to $112.9 million. Proforma Hotel EBITDA margin (expressed as a percentage of Total Hotel Revenue) improved 73 basis points to 31.2%. For all 118 hotels included in continuing operations as of June 30, 2007, Proforma Hotel EBITDA increased 7.2% to $117.3 million and Hotel EBITDA margin increased 49 basis points to 30.9%. Ashford believes year-over-year Hotel EBITDA and Hotel EBITDA margin comparisons are more meaningful to gauge the performance of the Company�s hotels than sequential quarter-over-quarter comparisons. Given the substantial seasonality in the Company�s portfolio and its active capital recycling, to help investors better understand this seasonality, the Company provides quarterly detail on its Proforma Hotel EBITDA and Proforma Hotel EBITDA margin for the current and certain prior-year periods based upon the number of core hotels in the portfolio as of the end of the current period. As Ashford�s portfolio mix changes from time to time so will the seasonality for Proforma Hotel EBITDA and Proforma Hotel EBITDA margin. Details of the quarterly calculations for the last four quarters for the current portfolio, including the 53 hotels acquired during the second quarter, are provided in the tables attached to this release. Monty J. Bennett, President and CEO, commented, "The strong second quarter performance reflects continued progress with our internal growth, asset management and capital allocation strategies. With the integration of the acquired CNL Hotels and Resorts� assets now complete, we are moving forward with the $280 million of value-added investments to further enhance the growth we are experiencing at our hotels. Over $100 million of the planned cap-ex is expected to kick off in the second half of the year. Our recent capital markets activities and asset sales have also helped us reach our deleveraging target well ahead of schedule and at very attractive terms in light of current market conditions." FINANCING ACTIVITY On April 24, 2007, the Company closed a follow-on offering of 48,875,000 shares of common stock at $11.75 per share. The offering raised net proceeds of approximately $548 million, which was used to pay off the following debt associated with the purchase of 51 hotels from CNL Hotels and Resorts: a $325 million term loan, $180 million of floating-rate CMBS and $45 million of existing debt. At June 30, 2007, the Company's net debt (defined as total debt less cash) to total enterprise value (defined as net debt plus the market value of all common shares, preferred shares and operating partnership units outstanding) was 57% based upon the Company's closing stock price of $11.76. As of June 30, 2007, the Company�s $2.9 billion debt balance consisted of 78% of fixed-rate debt, with a total weighted average interest rate of 6.1%. The Company�s weighted average debt maturity is 6.4 years. SECOND QUARTER INVESTMENT ACTIVITY On April 11, 2007, the Company completed the acquisition of a 51-hotel, 13,640-room (net after joint venture adjustment) hotel portfolio from CNL Hotels and Resorts for approximately $2.4 billion in total consideration ($177,000 per key). The estimated forward NOI cap rate is 7.6% and the EBITDA yield is 9.0% resulting in an 11.1x EBITDA multiple. On a trailing 12-month basis, the transaction�s NOI cap rate is 7.0% with an EBITDA yield of 8.4% equating to an 11.9x EBITDA multiple. On May 21, 2007, the Company completed the acquisition of a 120-room Residence Inn and a 118-room Hampton Inn hotel in Jacksonville, Florida for $35.8 million. On a trailing 12-month basis, the transaction�s NOI cap rate is 8.3% with an EBITDA yield of 9.1% equating to an 11.0x EBITDA multiple. The primary source of capital for this transaction was the proceeds of a 1031 tax-free exchange. On various dates throughout the quarter, the Company completed the sale of eleven hotels and one office building for a total of $115.8 million. The hotels sold include: the seven asset TownePlace Suites portfolio, the Embassy Suites Phoenix, Arizona, the Radisson Hotel Covington, Kentucky, the Fairfield Inn Evansville, Indiana and the Radisson Airport Hotel Indianapolis, Indiana. In connection with these sales, the Company generated a net gain of $33.3 million. The tax on this gain of $6.9 million will be deferred through a section 1031 tax-free exchange. SUBSEQUENT FINANCING AND INVESTMENT ACTIVITY On July 18, 2007, the Company priced 8,000,000 shares of 8.45% Series D Cumulative Preferred Stock at $25.00 per share. The annual distribution for the preferred stock is $2.1125 per share, payable quarterly. Ashford used the net proceeds of the offering to redeem the Company�s Series C Preferred Stock. INVESTMENT OUTLOOK Mr. Bennett concluded, "The concentration of our hotels in high-growth markets, high-growth segments and in premier brands, as well as our ability to assemble and integrate portfolios at attractive returns, differentiates Ashford in today�s market. We will continue to explore new opportunities to put this advantage to work for our shareholders. However, our primary focus is internal growth opportunities within our portfolio." INVESTOR CONFERENCE CALL AND SIMULCAST Ashford Hospitality Trust, Inc. will conduct a conference call at 11:00 a.m. ET on August 2, 2007, to discuss the second quarter results. The number to call for this interactive teleconference is (913) 981-4911. A seven-day replay of the conference call will be available by dialing (719) 457-0820 and entering the confirmation number, 8263407. The Company will also provide an online simulcast and rebroadcast of its first quarter 2006 earnings release conference call. The live broadcast of Ashford's quarterly conference call will be available online at the Company's website at www.ahtreit.com as well as on http://www.videonewswire.com/event.asp?regd=y&id=40824 on August 2, 2007, beginning at 11:00 a.m. ET. The online replay will follow shortly after the call and continue for approximately one year. Substantially all of our non-current assets consist of real estate investments and debt investments secured by real estate. Historical cost accounting for real estate assets implicitly assumes that the value of real estate assets diminishes predictably over time. Since real estate values instead have historically risen or fallen with market conditions, most industry investors consider supplemental measures of performance, which are not measures of operating performance under GAAP, to be helpful in evaluating a real estate company's operations. These supplemental measures include FFO, AFFO, EBITDA, Hotel Operating Profit, and CAD. FFO is computed in accordance with our interpretation of standards established by NAREIT, which may not be comparable to FFO reported by other REITs that do not define the term in accordance with the current NAREIT definition or that interpret the NAREIT definition differently than us. Neither FFO, AFFO, EBITDA, Hotel Operating Profit, nor CAD represents cash generated from operating activities as determined by GAAP and should not be considered as an alternative to a) GAAP net income (loss) as an indication of our financial performance or b) GAAP cash flows from operating activities as a measure of our liquidity, nor are such measures indicative of funds available to fund our cash needs, including our ability to make cash distributions. However, management believes FFO, AFFO, EBITDA, Hotel Operating Profit, and CAD to be meaningful measures of a REIT's performance and should be considered along with, but not as an alternative to, net income and cash flow as a measure of our operating performance. Ashford Hospitality Trust is a self-administered real estate investment trust focused on investing in the hospitality industry across all segments and at all levels of the capital structure, including direct hotel investments, first mortgages, mezzanine loans and sale-leaseback transactions. Additional information can be found on the Company's web site at www.ahtreit.com. Certain statements and assumptions in this press release contain or are based upon "forward-looking" information and are being made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. These forward-looking statements are subject to risks and uncertainties. When we use the words "will likely result," "may," "anticipate," "estimate," "should," "expect," "believe," "intend," or similar expressions, we intend to identify forward-looking statements. Such forward-looking statements include, but are not limited to, the timing for closing, the impact of the transaction on our business and future financial condition, our business and investment strategy, our understanding of our competition and current market trends and opportunities and projected capital expenditures. Such statements are subject to numerous assumptions and uncertainties, many of which are outside Ashford's control. These forward-looking statements are subject to known and unknown risks and uncertainties, which could cause actual results to differ materially from those anticipated, including, without limitation: general volatility of the capital markets and the market price of our common stock; changes in our business or investment strategy; availability, terms and deployment of capital; availability of qualified personnel; changes in our industry and the market in which we operate, interest rates or the general economy; and the degree and nature of our competition. These and other risk factors are more fully discussed in Ashford's filings with the Securities and Exchange Commission. EBITDA is defined as net income before interest, taxes, depreciation and amortization. EBITDA yield is defined as trailing twelve month EBITDA divided by the purchase price. A capitalization rate is determined by dividing the property's annual net operating income by the purchase price. Net operating income is the property's funds from operations minus a capital expense reserve of either 4% or 5% of gross revenues. Funds from operations ("FFO"), as defined by the White Paper on FFO approved by the Board of Governors of the National Association of Real Estate Investment Trusts ("NAREIT") in April 2002, represents net income (loss) computed in accordance with generally accepted accounting principles ("GAAP"), excluding gains (or losses) from sales or properties and extraordinary items as defined by GAAP, plus depreciation and amortization of real estate assets, and net of adjustments for the portion of these items related to unconsolidated entities and joint ventures. The forward-looking statements included in this press release are only made as of the date of this press release. Investors should not place undue reliance on these forward-looking statements. We are not obligated to publicly update or revise any forward-looking statements, whether as a result of new information, future events or circumstances, changes in expectations or otherwise. ASHFORD HOSPITALITY TRUST, INC. CONSOLIDATED STATEMENTS OF OPERATIONS (In Thousands, Except Share and Per Share Amounts) (Unaudited) � Three Months Three Months Six Months Six Months Ended Ended Ended Ended June 30, 2007 June 30, 2006 June 30, 2007 June 30, 2006 � REVENUE Rooms $ 250,772 $ 88,550 $ 364,163 $ 167,017 Food and beverage 79,116 17,754 110,326 32,540 Rental income from operating leases 1,184 - 1,184 - Other 16,006 � 4,263 � 21,020 � 7,711 � Total hotel revenue 347,078 110,567 496,693 207,268 Interest income from notes receivable 2,866 3,920 6,221 7,866 Asset management fees from affiliates 331 � 318 � 663 � 636 � Total Revenue 350,275 114,805 503,577 215,770 � EXPENSES Hotel operating expenses Rooms 55,268 19,058 80,388 35,908 Food and beverage 55,366 13,114 78,062 24,615 Other direct 7,912 1,836 10,279 3,429 Indirect 88,976 31,032 132,209 60,632 Management fees 12,791 � 4,315 � 18,312 � 8,201 � Total hotel expenses 220,313 69,355 319,250 132,785 � Property taxes, insurance, and other 18,602 6,000 26,614 11,193 Depreciation and amortization 60,213 11,148 77,132 21,155 Corporate general and administrative: Stock-based compensation 1,907 1,770 2,966 2,710 Other corporate and administrative 5,241 � 3,569 � 8,775 � 7,439 � Total Operating Expenses 306,276 � 91,842 � 434,737 � 175,282 � OPERATING INCOME 43,999 22,963 68,840 40,488 � Interest income 975 566 1,473 1,060 Interest expense (43,206 ) (11,330 ) (59,284 ) (22,766 ) Amortization of loan costs (2,263 ) (461 ) (2,923 ) (975 ) Write-off of loan costs and exit fees (5,264 ) (102 ) (5,966 ) (788 ) INCOME (LOSS) BEFORE INCOME TAXES AND MINORITY INTEREST (5,759 ) 11,636 2,140 17,019 Benefit from (provision for) income taxes (36 ) (103 ) 1,187 (228 ) Minority interest in consolidated joint ventures 523 - 523 - Minority interest related to limited partners 451 � (1,839 ) (800 ) (2,760 ) INCOME (LOSS) FROM CONTINUING OPERATIONS (4,821 ) 9,694 3,050 14,031 Income from discontinued operations, net: (including gains on sales net of income taxes of approximately $26.5 million and $27.8 million for the three and six months ended June 30, 2007, respectively) 25,905 � 1,329 � 29,525 � 4,454 � NET INCOME 21,084 11,023 32,575 18,485 Preferred dividends 7,033 � 2,719 � 9,826 � 5,438 � NET INCOME AVAILABLE TO COMMON SHAREHOLDERS $ 14,051 � $ 8,304 � $ 22,749 � $ 13,047 � � Income From Continuing Operations Per Share Available To Common Shareholders: Basic $ (0.11 ) $ 0.13 � $ (0.08 ) $ 0.16 � Diluted $ (0.11 ) $ 0.12 � $ (0.07 ) $ 0.16 � Income From Discontinued Operations Per Share: Basic $ 0.24 � $ 0.02 � $ 0.33 � $ 0.08 � Diluted $ 0.24 � $ 0.02 � $ 0.33 � $ 0.08 � Net Income Per Share Available To Common Shareholders: Basic $ 0.13 � $ 0.15 � $ 0.25 � $ 0.24 � Diluted $ 0.13 � $ 0.15 � $ 0.25 � $ 0.24 � Weighted Average Common Shares Outstanding: Basic 108,138,363 � 55,711,214 � 90,275,311 � 53,828,335 � Diluted 108,204,298 � 55,924,733 � 90,739,244 � 54,365,854 � ASHFORD HOSPITALITY TRUST, INC. CONSOLIDATED BALANCE SHEETS (In Thousands, Except Share and Per Share Amounts) (Unaudited) � June 30, Dec. 31, 2007 2006 � ASSETS Investment in hotel properties, net $ 4,279,054 $ 1,632,946 Cash and cash equivalents 157,175 73,343 Restricted cash 48,208 9,413 Accounts receivable, net 81,078 22,081 Inventories 4,522 2,110 Assets held for sale 26,553 119,342 Notes receivable 72,815 102,833 Deferred costs, net 34,066 14,143 Prepaid expenses 21,251 11,154 Other assets 7,193 7,826 Due from third-party hotel managers 39,097 15,964 Due from related parties 3,513 � 757 � Total assets $ 4,774,525 � $ 2,011,912 � � � LIABILITIES AND OWNERS' EQUITY Indebtedness $ 2,922,085 $ 1,091,150 Capital leases payable 815 177 Accounts payable 38,817 16,371 Accrued expenses 85,324 32,591 Dividends payable 34,842 19,975 Deferred income 270 294 Deferred incentive management fees 3,658 3,744 Unfavorable management contract liability 24,714 15,281 Other liabilities 3,084 - Due to third-party hotel managers 5,583 1,604 Due to related parties 929 � 4,152 � Total liabilities 3,120,121 1,185,339 � Commitments and contingencies Minority interest in consolidated joint ventures 103,624 - Minority interest related to limited partnership interests 108,141 109,864 Preferred stock, $0.01 par value: Series B Cumulative Convertible Redeemable Preferred Stock, 7,447,865 issued and outstanding at June 30, 2007 and December 31, 2006, respectively � 75,000 75,000 � Preferred stock, $0.01 par value, 50,000,000 shares authorized: Series A Cumulative Preferred Stock, 2,300,000 issued and outstanding at June 30, 2007 and December 31, 2006, respectively � 23 23 Series C Cumulative Preferred Stock, 8,000,000 issued and outstanding at June 30, 2007 80 - Common stock, $0.01 par value, 200,000,000 shares authorized, 122,634,167 shares issued and 122,613,582 shares outstanding at June 30, 2007 and 72,942,841 shares issued and outstanding at December 31, 2006 � � 1,226 729 Additional paid-in capital 1,452,629 708,420 Accumulated other comprehensive income (loss) (14 ) 111 Accumulated deficit (86,058 ) (67,574 ) Treasury stock, at cost (20,585 shares) (247 ) - � Total owners' equity 1,367,639 641,709 � � Total liabilities and owners' equity $ 4,774,525 � $ 2,011,912 � ASHFORD HOSPITALITY TRUST, INC. EBITDA (In Thousands) (Unaudited) � Three Months Three Months Six Months Six Months Ended Ended Ended Ended June 30, 2007 June 30, 2006 June 30, 2007 June 30, 2006 � Net income $ 21,084 � $ 11,023 � $ 32,575 � $ 18,485 � � Add back: Interest income (975 ) (566 ) (1,473 ) (1,060 ) Interest expense and amortization of loan costs 45,469 11,791 62,207 23,741 Depreciation and amortization 60,213 12,374 77,409 23,308 Minority interest relating to limited partners 1,979 2,091 3,806 3,675 Provision for income taxes 6,903 � 85 � 6,392 � 238 � 113,589 25,775 148,341 49,902 � � � � EBITDA $ 134,673 � $ 36,798 � $ 180,916 � $ 68,387 � � For the three months ended June 30, 2007, EBITDA has not been adjusted to deduct the amortization of the unfavorable management contract liabilities of approximately $512,000, the write-off of loan costs and exit fees of approximately $5.3 million, and gains on sales of properties of approximately $33.3 million. � For the three months ended June 30, 2006, EBITDA has not been adjusted to add back the write-off of loan costs of approximately $102,000 and the loss from reclassification from discontinued to continuing of approximately $863,000. � For the six months ended June 30, 2007, EBITDA has not been adjusted to deduct the amortization of the unfavorable management contract liabilities of approximately $936,000, the write-off of loan costs and exit fees of approximately $6.0 million, and gains on sales of properties of approximately $34.7 million. � For the six months ended June 30, 2006, EBITDA has not been adjusted to add back the write-off of loan costs of approximately $788,000 and the loss from reclassification from discontinued to continuing of approximately $863,000. ASHFORD HOSPITALITY TRUST, INC. FFO and Adjusted FFO (In Thousands, Except Share And Per Share Amounts) (Unaudited) � Three Months Three Months Six Months Six Months Ended Ended Ended Ended June 30, 2007 June 30, 2006 June 30, 2007 June 30, 2006 � Net income available to common shareholders $ 14,051 � $ 8,304 $ 22,749 � $ 13,047 � Plus real estate depreciation and amortization 60,127 12,187 77,243 22,913 Remove gains on sales of properties, net of related income taxes (26,450 ) - (27,839 ) - Remove minority interest relating to limited partners 1,979 � 2,091 3,806 � 3,675 FFO available to common shareholders $ 49,707 � $ 22,582 $ 75,959 � $ 39,635 � Add back dividends on convertible preferred stock 1,564 1,490 3,128 2,979 Add back write-off of loan costs and exit fees 5,264 102 5,966 788 Add back loss from reclassification of discontinued to continuing - � 863 - � 863 Adjusted FFO $ 56,535 � $ 25,037 $ 85,053 � $ 44,265 � Adjusted FFO per diluted share available to common shareholders $ 0.44 � $ 0.34 $ 0.76 � $ 0.61 � Diluted weighted average shares outstanding 129,164,588 � 74,163,787 111,699,534 � 72,744,204 ASHFORD HOSPITALITY TRUST, INC. CASH AVAILABLE FOR DISTRIBUTION ("CAD") (In Thousands, Except Per Share Amounts) (Unaudited) � Three Months Three Months Ended Ended June 30, 2007 (per diluted share) June 30, 2006 (per diluted share) � Net income available to common shareholders $ 14,051 $ 0.11 $ 8,304 $ 0.11 Add back dividends on convertible preferred stock 1,564 � 0.01 � 1,490 � 0.02 � Total $ 15,615 $ 0.12 $ 9,794 $ 0.13 � Plus real estate depreciation and amortization 60,127 $ 0.47 12,187 $ 0.16 Remove minority interest relating to limited partners 1,979 0.02 2,091 0.03 Plus stock-based compensation 1,907 0.01 1,770 0.02 Plus amortization of loan costs 2,263 0.02 461 0.01 Plus write-off of loan costs and exit fees 5,264 0.04 102 0.00 Plus loss from reclassification of discontinued to continuing - 0.00 863 0.01 Less amortization of unfavorable management contract liabilities (512 ) (0.00 ) - 0.00 Less gains on sales of properties, net of related income taxes (26,450 ) (0.20 ) - 0.00 Less capital improvements reserve (14,804 ) (0.11 ) (4,560 ) (0.06 ) CAD $ 45,389 � $ 0.35 � $ 22,708 � $ 0.31 � � � Six Months Six Months Ended Ended June 30, 2007 (per diluted share) June 30, 2006 (per diluted share) � Net income available to common shareholders $ 22,749 $ 0.20 $ 13,047 $ 0.18 Add back dividends on convertible preferred stock 3,128 � 0.03 � 2,979 � 0.04 � Total $ 25,877 $ 0.23 $ 16,026 $ 0.22 � Plus real estate depreciation and amortization 77,243 $ 0.69 22,913 $ 0.31 Remove minority interest relating to limited partners 3,806 0.03 3,675 0.05 Plus stock-based compensation 2,966 0.03 2,710 0.04 Plus amortization of loan costs 2,923 0.03 975 0.01 Plus write-off of loan costs and exit fees 5,966 0.05 788 0.01 Plus loss from reclassification of discontinued to continuing - 0.00 863 0.01 Less amortization of unfavorable management contract liabilities (936 ) (0.01 ) - 0.00 Less gains on sales of properties, net of related income taxes (27,839 ) (0.25 ) - 0.00 Less capital improvements reserve (20,491 ) (0.18 ) (7,953 ) (0.11 ) CAD $ 69,515 � $ 0.62 � $ 39,997 � $ 0.55 � ASHFORD HOSPITALITY TRUST, INC. KEY PERFORMANCE INDICATORS - PRO FORMA (Unaudited) � Three Months Ended Six Months Ended June 30, June 30, � 2007 � 2006 � % Variance 2007 � 2006 � % Variance � � ALL HOTELS INCLUDED IN CONTINUING OPERATIONS: � Room revenues(1) $ 277,105,842 $ 261,681,090 5.89 % $ 534,569,682 $ 505,953,006 5.66 % RevPAR(1) $ 110.44 $ 104.35 5.83 % $ 106.89 $ 100.81 6.03 % Occupancy 78.17 % 78.14 % 0.04 % 74.85 % 75.22 % -0.50 % ADR $ 141.28 $ 133.54 5.79 % $ 142.82 $ 134.02 6.56 % � � NOTE: The above pro forma table assumes the 118 hotel properties owned and included in continuing operations at June 30, 2007 were owned as of the beginning of the periods presented. � � Three Months Ended Six Months Ended June 30, June 30, � 2007 � 2006 � % Variance 2007 � 2006 � % Variance � � ALL HOTELS NOT UNDER RENOVATION INCLUDED IN CONTINUING OPERATIONS: � Room revenues(1) $ 264,663,966 $ 248,466,431 6.52 % $ 511,262,362 $ 481,892,097 6.09 % RevPAR(1) $ 110.24 $ 103.55 6.47 % $ 106.84 $ 100.33 6.49 % Occupancy 78.34 % 77.93 % 0.53 % 75.03 % 75.16 % -0.17 % ADR $ 140.72 $ 132.88 5.90 % $ 142.41 $ 133.50 6.67 % � � NOTE: The above pro forma table assumes the 114 hotel properties owned and included in continuing operations at June 30, 2007 but not under renovation for the three and six months ended June 30, 2007 were owned as of the beginning of the periods presented. � Excluded Hotels Under Renovation: Radisson City Center - Indianapolis, Sea Turtle Inn Jacksonville, Hyatt Dulles, JW Marriott San Francisco � (1) On March 26, 2006, the Company converted its Radisson hotel in Ft. Worth, Texas, to a Hilton hotel, which resulted in a room count reduction from 517 to 294. Consequently, the increase in pro forma RevPAR exceeded the increase in pro forma room revenues for the three months ended March 31, 2007 compared to the same 2006 period. � ASHFORD HOSPITALITY TRUST, INC. Pro Forma Hotel RevPAR by Region (Unaudited) � Three Months Ended Six Months Ended Percent June 30, June 30, Change in RevPAR Region Number of Hotels � Number of Rooms 2007 2006 2007 2006 � Quarter YTD � Pacific(1) 23 5,818 $119.61 $110.42 $114.63 $106.17 8.3% 8.0% Mountain(2) 8 1,597 $103.52 $99.22 $113.96 $108.36 4.3% 5.2% West North Central(3) 4 786 $91.25 $86.08 $85.86 $81.38 6.0% 5.5% West South Central(4) 12 2,955 $103.63 $90.47 $104.10 $90.23 14.5% 15.4% East North Central(5) 10 2,557 $85.92 $82.47 $79.85 $79.87 4.2% 0.0% East South Central(6) 3 441 $92.06 $92.87 $88.77 $88.27 -0.9% 0.6% Middle Atlantic(7) 10 2,558 $112.75 $102.49 $100.36 $92.79 10.0% 8.2% South Atlantic(8) 43 9,195 $118.46 $114.77 $117.36 $112.62 3.2% 4.2% New England(9) 4 458 $72.71 $70.91 $63.83 $58.08 2.5% 9.9% Canada 1 607 $111.78 $125.75 $81.61 $91.02 -11.1% -10.3% � � � � � � � � Total Portfolio 118 26,971 $110.44 $104.35 $106.89 $100.81 5.8% 6.0% � (1) Includes Alaska and California (2) Includes Nevada, Arizona, New Mexico, and Utah (3) Includes Minnesota and Kansas (4) Includes Texas (5) Includes Ohio, Illinois, and Indiana (6) Includes Kentucky and Alabama (7) Includes New York and Pennsylvania (8) Includes Virginia, Florida, Georgia, Maryland, and North Carolina (9) Includes Massachusetts � NOTE: The above pro forma table assumes the 118 hotel properties owned and included in continuing operations as of June 30, 2007 were owned as of the beginning of the periods presented. ASHFORD HOSPITALITY TRUST, INC. Pro Forma Hotel RevPAR by Brand (Unaudited) � Three Months Ended Six Months Ended Percent June 30, June 30, Change in RevPAR Brand Number of Hotels Number of Rooms � 2007 2006 2007 2006 � Quarter YTD � Hilton 38 8,227 $117.84 $108.90 $116.72 $106.50 8.2% 9.6% Hyatt 5 2,591 $103.29 $98.64 $99.24 $96.00 4.7% 3.4% InterContinental 2 420 $151.24 $137.66 $160.94 $145.13 9.9% 10.9% Independent 2 317 $82.77 $94.93 $73.77 $83.71 -12.8% -11.9% Marriott 62 12,988 $108.72 $103.88 $104.97 $101.07 4.7% 3.9% Radisson 3 686 $68.06 $72.66 $59.01 $60.47 -6.3% -2.4% Starwood 6 1,742 $104.20 $97.27 $89.49 $82.82 7.1% 8.1% � � � � � � � � Total Portfolio 118 26,971 $110.44 $104.35 $106.89 $100.81 5.8% 6.0% � NOTE: The above pro forma table assumes the 118 hotel properties owned and included in continuing operations as of June 30, 2007 were owned as of the beginning of the periods presented. ASHFORD HOSPITALITY TRUST, INC. PRO FORMA HOTEL OPERATING PROFIT (In Thousands) (Unaudited) � ALL HOTELS INCLUDED IN CONTINUING OPERATIONS: � Three Months Ended Six Months Ended June 30, 2007 � June 30, 2006 � % Variance June 30, 2007 � June 30, 2006 � % Variance � REVENUE Rooms(1) $ 277,106 $ 261,681 5.89% $ 534,570 $ 505,953 5.66% Food and beverage 84,889 80,805 5.05% 162,222 153,489 5.69% Other 17,387 17,212 1.02% 33,995 33,475 1.55% Total hotel revenue 379,382 359,698 5.47% 730,787 692,917 5.47% � EXPENSES Hotel operating expenses Rooms(1) 59,656 58,554 1.88% 115,461 114,087 1.20% Food and beverage 59,461 57,418 3.56% 116,585 111,853 4.23% Other direct 8,828 9,101 -3.00% 17,191 17,685 -2.79% Indirect 95,811 89,347 7.23% 188,934 178,659 5.75% Management fees, includes base and incentive fees 18,227 17,025 7.06% 32,862 31,253 5.15% Total hotel operating expenses 241,983 231,445 4.55% 471,033 453,537 3.86% � Property taxes, insurance, and other 20,130 18,846 6.81% 39,289 36,048 8.99% � � � � � � HOTEL OPERATING PROFIT (Hotel EBITDA) $ 117,269 $ 109,407 7.19% $ 220,465 $ 203,332 8.43% � Minority interest in consolidated joint ventures $ 7,656 $ 7,048 8.63% $ 15,206 $ 13,901 9.39% HOTEL OPERATING PROFIT (Hotel EBITDA), excluding minority interest in joint ventures $ 109,613 $ 102,359 7.09% $ 205,259 $ 189,431 8.36% � � NOTE: The above pro forma table assumes the 118 hotel properties owned and included in continuing operations at June 30, 2007 were owned as of the beginning of the periods presented. � � ALL HOTELS NOT UNDER RENOVATION INCLUDED IN CONTINUING OPERATIONS: � Three Months Ended Six Months Ended June 30, 2007 � June 30, 2006 � % Variance June 30, 2007 � June 30, 2006 � % Variance � REVENUE Rooms(1) $ 264,664 $ 248,466 6.52% $ 511,262 $ 481,892 6.09% Food and beverage 80,355 75,550 6.36% 153,689 144,063 6.68% Other 16,495 16,449 0.28% 32,357 31,908 1.41% Total hotel revenue 361,514 340,465 6.18% 697,308 657,863 6.00% � EXPENSES Hotel operating expenses Rooms(1) 56,674 55,404 2.29% 109,531 108,224 1.21% Food and beverage 56,006 53,411 4.86% 109,924 104,544 5.15% Other direct 8,604 8,831 -2.57% 16,764 17,190 -2.48% Indirect 90,714 84,948 6.79% 179,322 169,869 5.56% Management fees, includes base and incentive fees 17,498 16,219 7.89% 31,526 29,755 5.95% Total hotel operating expenses 229,496 218,813 4.88% 447,067 429,582 4.07% � Property taxes, insurance, and other 19,083 17,767 7.41% 37,165 34,126 8.91% � � � � � � HOTEL OPERATING PROFIT (Hotel EBITDA) $ 112,935 $ 103,885 8.71% $ 213,076 $ 194,155 9.75% � Minority interest in consolidated joint ventures $ 7,656 $ 7,048 8.63% $ 15,206 $ 13,901 9.39% HOTEL OPERATING PROFIT (Hotel EBITDA), excluding minority interest in joint ventures $ 105,279 $ 96,837 8.72% $ 197,870 $ 180,254 9.77% � � NOTE: The above pro forma table assumes the 114 hotel properties owned and included in continuing operations at June 30, 2007 but not under renovation during the three and six months ended June 30, 2007 were owned as of the beginning of the periods presented. � (1) On March 26, 2006, the Company converted its Radisson hotel in Ft. Worth, Texas, to a Hilton hotel, which resulted in a room count reduction from 517 to 294. Consequently, the increase in pro forma RevPAR exceeded the increase in pro forma room revenues for the six months ended June 30, 2007 compared to the same 2006 period. � ASHFORD HOSPITALITY TRUST, INC. Pro Forma Hotel Operating Profit by Region (In Thousands) (Unaudited) � Three Months Ended Six Months Ended Percent Change June 30, June 30, in Hotel Operating Profit Region Number of Hotels Number of Rooms 2007 � % Total 2006 � % Total 2007 � % Total 2006 � % Total Quarter YTD � Pacific(1) 23 5,818 $28,645 24.4% $25,493 23.3% $53,651 24.3% $48,052 23.6% 12.4% 11.7% Mountain(2) 8 1,597 $5,937 5.1% $6,292 5.8% $16,015 7.3% $15,345 7.5% -5.6% 4.4% West North Central(3) 4 786 $2,841 2.4% $2,641 2.4% $5,129 2.3% $4,574 2.2% 7.6% 12.1% West South Central(4) 12 2,955 $11,378 9.7% $7,813 7.1% $23,091 10.5% $17,545 8.6% 45.6% 31.6% East North Central(5) 10 2,557 $8,661 7.4% $7,946 7.3% $13,235 6.0% $14,592 7.2% 9.0% -9.3% East South Central(6) 3 441 $1,395 1.2% $1,567 1.4% $2,712 1.2% $2,847 1.4% -11.0% -4.7% Middle Atlantic(7) 10 2,558 $11,117 9.5% $9,842 9.0% $17,215 7.8% $14,175 7.0% 13.0% 21.4% South Atlantic(8) 43 9,195 $44,162 37.7% $43,885 40.1% $87,240 39.6% $83,123 40.9% 0.6% 5.0% New England(9) 4 458 $993 0.8% $1,007 0.9% $1,166 0.5% $707 0.3% -1.4% 64.9% Canada 1 607 $2,140 1.8% $2,921 2.7% $1,011 0.5% $2,372 1.2% -26.7% -57.4% � � � � � � � � � � � � � � � � Total Portfolio 118 26,971 $117,269 � 100.0% $109,407 � 100.0% $220,465 � 100.0% $203,332 � 100.0% 7.2% 8.4% � � (1) Includes Alaska and California (2) Includes Nevada, Arizona, New Mexico, and Utah (3) Includes Minnesota and Kansas (4) Includes Texas (5) Includes Ohio, Illinois, and Indiana (6) Includes Kentucky and Alabama (7) Includes New York and Pennsylvania (8) Includes Virginia, Florida, Georgia, Maryland, and North Carolina (9) Includes Massachusetts � � NOTE: The above pro forma table assumes the 118 hotel properties owned and included in continuing operations as of June 30, 2007 were owned as of the beginning of the periods presented. ASHFORD HOSPITALITY TRUST, INC. PRO FORMA HOTEL OPERATING PROFIT MARGIN (Unaudited) � � 114 HOTELS NOT UNDER RENOVATION AND INCLUDED IN CONTINUING OPERATIONS AT JUNE 30, 2007 AS IF SUCH HOTELS WERE OWNED AS OF THE BEGINNING OF THE PERIODS PRESENTED: � � HOTEL OPERATING PROFIT (HOTEL EBITDA) MARGIN: � 2nd Quarter 2007 31.24% 2nd Quarter 2006 30.51% Variance 0.73% � HOTEL OPERATING PROFIT (HOTEL EBITDA) MARGIN VARIANCE BREAKDOWN: � Rooms 0.60% Food & Beverage and Other Departmental 0.41% Administrative & General 0.00% Sales & Marketing 0.18% Hospitality -0.06% Repair & Maintenance 0.07% Energy 0.14% Franchise Fee -0.30% Management Fee 0.00% Incentive Management Fee -0.07% Insurance 0.27% Property Taxes -0.33% Leases/Other -0.17% Total 0.73% ASHFORD HOSPITALITY TRUST, INC. PRO FORMA SEASONALITY TABLE (In Thousands) (Unaudited) � � ALL 118 HOTELS OWNED AND INCLUDED IN CONTINUING OPERATIONS AS OF JUNE 30, 2007: � � 2006 2006 2007 2007 � 3rd Quarter 4th Quarter 1st Quarter 2nd Quarter TTM � Total Hotel Revenue 327,260 370,042 351,405 379,382 1,428,088 Hotel EBITDA 86,379 98,299 103,196 117,269 405,144 Hotel EBITDA Margin 26.4% 26.6% 29.4% 30.9% 28.4% � EBITDA % of Total TTM 21.3% 24.3% 25.5% 28.9% 100.0% � JV Interests in EBITDA 4,678 5,670 7,550 7,656 25,554 � � NOTE: The above pro forma table assumes that the 118 hotel properties owned and included in continuing operations as of June 30, 2007 were owned as of the beginning of the periods presented. Ashford Hospitality Trust, Inc. Debt Summary As of June 30, 2007 (in millions) � Fixed-Rate Floating-Rate Total Debt Debt Debt � $487.1 million mortgage note payable secured by 32 hotel properties, matures between July 1, 2015 and February 1, 2016, at an average interest rate of 5.42% � $ 455.1 $ - $ 455.1 $211.5 million term loan secured by 16 hotel properties, matures between December 11, 2014 and December 11, 2015, at an average interest rate of 5.73% � 211.5 - 211.5 $300.0 million secured credit facility, matures April 9, 2010, at an interest rate of LIBOR plus a range of 1.55% to 1.95% depending on the loan-to-value ratio � - 50.0 50.0 $47.5 million secured credit facility secured by 1 hotel property, matures October 10, 2008, at an interest rate of LIBOR plus 1.0% to 1.5% depending on the outstanding balance � � - - - Mortgage note payable secured by one hotel property, matures December 1, 2017, at an interest rate of 7.24% through December 31, 2007 and 7.39% thereafter � 51.7 - 51.7 Mortgage note payable secured by one hotel property, matures December 8, 2016, at an interest rate of 5.81% 101.0 - 101.0 Mortgage note payable secured by six hotel properties, matures December 11, 2009, at an interest rate of LIBOR plus 1.72% - 184.0 184.0 $928.5 million mortgage loan secured by 28 hotel properties, matures April 11, 2017, at an average blended interest rate of 5.95% 928.5 - 928.5 $375.0 million loan secured by 18 hotels and mezzanine notes receivable, matures May 9, 2009, at an interest rate of LIBOR plus 1.65% - 375.0 375.0 Mortgage loans assumed with acquisition of CNL portfolio, maturing between 2008 and 2025, with an average blended interest rate of 5.61% � 436.0 � - � 436.0 � Total Debt Excluding Premium $ 2,183.8 � $ 609.0 � $ 2,792.8 Mark-to-Market Premium 4.3 Plus Debt Attributable to Joint Venture Partners 125.0 � Net Debt Including Premium $ 2,922.1 � � Percentage of Total 78.19 % 21.81 % 100.00 % � Weighted Average Interest Rate at June 30, 2007 6.09 % ASHFORD HOSPITALITY TRUST, INC. Capital Expenditures Calendar 118 Core Hotels (a) � � � � � � � � � � � � � � � 2006 � 2007 Actual Actual Actual Actual Actual Actual Estimated Estimated Rooms � 1st Quarter � 2nd Quarter � 3rd Quarter � 4th Quarter � 1st Quarter � 2nd Quarter � 3rd Quarter � 4th Quarter � Doubletree Suites Columbus 194 Embassy Suites East Syracuse 215 Sheraton Bucks County 187 Hampton Inn Mall of Georgia 92 Sheraton Milford 173 x Hampton Inn Terre Haute 112 Hampton Inn Evansville 141 Hilton St. Petersburg Bayfront 333 Courtyard Bloomington 117 Residence Inn Salt Lake City 144 Hilton Fort Worth 294 x Residence Inn Palm Desert 130 Embassy Suites Houston 150 x Radisson Rockland 127 x Residence Inn San Diego Sorrento Mesa 150 x Hilton Nassau Bay - Clear Lake 243 x Crowne Plaza Beverly Hills 260 x Radisson City Center - Indianapolis 371 x x x Sheraton Minneapolis West 222 x x Embassy Suites West Palm Beach 160 x x Historic Inns of Annapolis 124 x x Residence Inn Fairfax Merrifield 159 x Courtyard Crystal City Reagan Airport 272 x x Courtyard Palm Desert 151 x SpringHill Suites Kennesaw 90 x x SpringHill Suites Jacksonville 102 x x Courtyard Atlanta Alpharetta 154 x x Sea Turtle Inn Jacksonville 193 x x x x x x Courtyard Columbus Tipton Lakes 90 x Residence Inn Evansville 78 x x SpringHill Suites BWI Airport 133 x x SpringHill Suites Centreville 136 x x SpringHill Suites Gaithersburg 162 x x Courtyard Overland Park 168 x x Hilton Santa Fe 157 x x Hilton Garden Inn Jacksonville 119 x Marriott at Research Triangle Park 225 x x Marriott Crystal Gateway 697 x x Hyatt Dulles 316 x x x x JW Marriott San Francisco 338 x x x Embassy Suites Las Vegas Airport 220 x x Homewood Suites Mobile 86 x x Hilton Tucson El Conquistador Golf Resort 321 x x Residence Inn Lake Buena Vista 210 x x Embassy Suites Philadelphia Airport 263 x x Embassy Suites Walnut Creek 249 x x Hilton Minneapolis Airport 300 x x Sheraton San Diego Mission Valley 260 x x Courtyard Marriott Village LBV 312 x x Sheraton Anchorage 375 x Courtyard Louisville Airport 150 x Hilton Costa Mesa 340 x Courtyard San Francisco Downtown 405 x Courtyard Basking Ridge 235 x TownePlace Suites Manhattan Beach 144 x Embassy Suites Santa Clara - Silicon Valley 193 x Hampton Inn Jacksonville 118 x Residence Inn Jacksonville 120 x Hyatt Regency Orange County 654 � � � � � � � � � � � � � � � x � (a) Only hotels which have had or are expected to have significant capital expenditures during 2006 or 2007 are included in this table.