Tpg Re Finance Trust, Inc. · NYSE:TRTX
Tpg Re Finance Trust — FY2018 Earnings Presentation
26 slides from Tpg Re Finance Trust's earnings presentation, Feb 26, 2019
Slide 1: Fourth Quarter and Full Year 2018 Operating Results
February 25, 2019 Fourth Quarter and Full Year 2018 Operating Results Exhibit 99.2
Slide 2: Forward-Looking Statements
Forward-Looking Statements The information contained in this earnings presentation contains “forward‐looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. These forward‐looking statements a
Slide 3: Loan Portfolio Highlights
Loan Portfolio Highlights Loan Investment Activity Loan Portfolio See Appendix for definitions, including definitions of LTV, Loan Category, Property Type, Risk Rating, and Asset-Level Estimated Return on Equity (“ALEROE”). Reflects the impact of (1) $508.2 million of construction loan repayments an
Slide 4: Operating Performance Highlights
Operating Performance Highlights QoQ Financial Performance Performance Metric Quarter ended 12/31/18 Quarter ended 9/30/18 GAAP net income $28.6 million ($0.43 / share) $26.8 million ($0.42 / share) Core Earnings1 $28.6 million ($0.43 / share) $26.9 million ($0.42 / share) Cash dividends declared $2
Slide 5: Capital Markets Highlights
Capital Markets Highlights Capital Markets Activity Capitalization Performance Metric Year ended 12/31/18 Year ended 12/31/17 YOY Change Loan Financing Commitments $5.6 billion $3.3 billion 69.7% Loan Portfolio Financing Capacity $2.4 billion $1.1 billion 118.2% Available Liquidity $276.2 million $2
Slide 6: Operating Performance
$0.43 $0.43 $0.43 Operating Performance 4Q18 net interest income increased to $36.1 million, up $0.5 million, or 1.5%, from the quarter ended September 30, 2018, due to loan portfolio growth, increased LIBOR and a lower cost of funds Declared cash dividends of $0.43 per common share during the quart
Slide 7: Geographic Diversity and Diversified Loan Portfolio
Geographic Diversity Diversified Loan Portfolio National, Major Market Footprint Property Diversity2 Lending Focused in Top 25 Markets1 Fixed vs. Floating2 Loan Category 1. Top 25 markets determined by US Census. Portfolio loans with collateral properties that are located in different MSAs are class
Slide 8: Diversified Loan Portfolio
Diversified Loan Portfolio 1. See Appendix for a description of the Company’s risk rating scale and definition of Loan Category and Property Type. 2. By total loan commitment. 3. By loan carrying value. Note: Totals may not sum due to rounding. Year-over-Year Growth by Loan and Property Type1,2 Cons
Slide 9: Loan Originations 4Q18 Investment Highlights
Loan Originations 4Q18 Investment Highlights Closed 5 first mortgage loans Total commitments of $623.7 million Initial fundings of $452.1 million Average loan size of $124.7 million1 100% Floating Rate Weighted average interest rate of LIBOR plus 3.26% Weighted average LTV of 64.8%2 Property types:
Slide 10: Select 4Q 2018 Loan Originations
Office Multifamily Office $210.0M $206.5M $105.9M Detroit, MI Orlando & Fort Meyers, FL Torrance, CA 965,574 SF / 1,300,441 SF as-complete Class A office Newly-developed, three-property, 1,139-unit Class A multifamily portfolio 417,163 SF mixed-use (office and retail) property Addition of 350K NRSF
Slide 11: Loan Funding Activity through December 31, 2018
Loan Funding Activity through December 31, 2018 4Q18 portfolio growth spurred by $623.7 million of new loan commitments with a $124.7 million average loan size Loan UPB grew $1.1 billion to $4.3 billion, an increase of 34.9% from December 31, 2017 4Q18 loan repayments of $367.9 million included cons
Slide 12: Loan Portfolio Financing as of December 31, 2018
Loan Portfolio Financing as of December 31, 2018 1. Total Loan Portfolio Financing Capacity and Financing Utilization relates only to the financing of the Company’s loan investments. 2. Borrowings are 100% recourse to the Company. Note: Excludes items related to CMBS investments. Totals may not sum
Slide 13: Benefits of Non-recourse, Matched-term Financing
Reduces recourse financing Eliminates mark-to-mark risk on loan portfolio Enhances Asset-Level Estimated Returns1 due to reduced cost of funds and increased advance rate Benefits of Non-recourse, Matched-term Financing Loan Portfolio Financing as of December 31, 2018 Non-recourse, matched-funded fin
Slide 14: Capital Deployment
Capital Deployment Sustained Capital Deployment Drives Portfolio Growth & Attractive Asset-Level Returns 1. See Appendix for definitions, including definitions of Debt-to-Equity and Total Leverage. 2. Outstanding total loan commitments as of the reporting date. 3. Does not take into account near ter
Slide 15: Interest Rate Sensitivity
Interest Rate Sensitivity 100% floating rate loan portfolio well positioned in a rising interest rate environment1 Net floating rate mortgage loan exposure of $1.2 billion generates an annualized increase in net interest income of approximately $5.9 million for every 50 basis point increase in 1-mon
Slide 16: Appendix
Appendix
Slide 17: Per Share Calculations / Core Earnings Reconciliation
Per Share Calculations Per Share Calculations / Core Earnings Reconciliation Earnings and Dividends per Common Share Year Ended Three Months Ended (unaudited) Dec 31, 2018 Dec 31, 2018 Sep 30, 2018 Jun 30, 2018 Mar 31, 2018 Net Income Attributable to Common Stockholders1 $106,744 $28,467 $26,797 $26
Slide 18: TRTX Loan Portfolio
TRTX Loan Portfolio Loan Name TRTX Loan Commitment1 TRTX Loan Balance2 Interest Rate Extended Maturity Location Property Type Commitment Per Sq. ft. / Unit LTV3 Loan 1 $223.0 $167.1 L + 3.4% 5.6 years Atlanta, GA Office $214 Sq. ft. 61.4% Loan 2 $210.0 131.9 L + 3.6% 5.0 years Detroit, MI Office $21
Slide 19: Consolidated Balance Sheets
ASSETS December 31, 2018 December 31, 2017 Cash and Cash Equivalents $39,720 $75,037 Restricted Cash 1,000 700 Accounts Receivable 38 141 Accounts Receivable from Servicer/Trustee 96,464 220 Accrued Interest Receivable 20,731 16,861 Loans Held for Investment, net (includes $2,219,574 and $2,694,106
Slide 20: Consolidated Statements of Income and Comprehensive Income
Consolidated Statements of Income and Comprehensive Income All amounts in thousands except share and per share amounts (three months ended Dec 31 is unaudited) Three Months Ended Dec 31, Year Ended Dec 31, INTEREST INCOME 2018 2017 2018 2017 Interest Income $71,673 $52,492 $265,594 $198,903 Interest
Slide 21: Consolidated Statements of Cash Flows
Year Ended, Cash Flows from Operating Activities: Dec 31, 2018 Dec 31, 2017 Net Income $106,941 $94,352 Adjustment to Reconcile Net Income to Net Cash Provided by Operating Activities: Amortization and Accretion of Premiums, Discounts and Loan Origination Fees, net (15,915) (19,477) Amortization of
Slide 22: Definitions
Definitions TRTX uses Core Earnings to evaluate its performance excluding the effects of certain transactions and GAAP adjustments it believes are not necessarily indicative of its current loan activity and operations. Core Earnings is a non-GAAP measure, which TRTX defines as GAAP net income (loss)
Slide 23: Definitions (cont.)
Definitions (cont.) Debt-to-Equity - Represents (i) total outstanding borrowings under financing arrangements, net, including collateralized loan obligations, secured revolving repurchase agreements, senior secured and secured credit agreements, a term loan facility, and an asset-specific financing
Slide 24: Definitions (cont.)
Definitions (cont.) Bridge/Stabilization Loan - A loan with limited deferred fundings, generally less than 10% of the total loan commitment, which fundings are commonly conditioned on the borrower’s satisfaction of certain collateral performance tests. The related business plan generally involves li
Slide 25: Definitions (cont.) Risk Ratings
Definitions (cont.) Risk Ratings Based on a 5-point scale, TRTX’s loans are rated “1” through “5,” from least risk to greatest risk, respectively, on a quarterly basis. The loan risk ratings are defined as follows: 1: Outperform—Exceeds performance metrics (for example, technical milestones, occupan
Slide 26: Company Information
Company Information Contact Information Headquarters: 888 Seventh Avenue 35th Floor New York, NY 10106 New York Stock Exchange: Symbol: TRTX TPG RE Finance Trust, Inc. Robert Foley Chief Financial & Risk Officer (212) 430-4111 bfoley@tpg.com Investor Relations: (212) 405-8500 IR@tpgrefinance.com Med