Ashford Hospitality Trust announced the launch of 'GRO AHT,' a transformative strategic initiative designed to drive outsized EBITDA growth and substantially improve shareholder value. The initiative targets an incremental $50 million of EBITDA improvement to run-rate corporate EBITDA, representing an increase of more than 20%.
The 'GRO AHT' initiative is built upon three core pillars: G&A Reduction, Revenue Maximization, and Operational Efficiency. Under G&A Reduction, the company is implementing significant corporate overhead cuts, including a 50% reduction in cash compensation for Board members, a reduction in Board size from nine to seven members, and substantial cuts to total incentive awards granted to executive management and other associates by over 50%.
The Revenue Maximization pillar focuses on boosting rooms revenue market share, conducting pricing audits to increase ancillary revenue, and introducing additional revenue streams across the portfolio. Operational Efficiency aims to combat margin pressures through renegotiating vendor contracts, implementing energy-saving measures, and optimizing labor. The company also targets an early Q1 payoff for its Oaktree financing.
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