Apollo Commercial Real Estate Finance, Inc · NYSE:ARI
Apollo Commercial Real Estate Finance — Q1 2020 Earnings Presentation
20 slides from Apollo Commercial Real Estate Finance's earnings presentation, May 7, 2020
Slide 1: Q1 2020 Financial Results
Q1 2020 Financial Results May 7, 2020 Exhibit 99.2
Slide 2: Forward Looking Statements and Other Disclosures
Forward Looking Statements and Other Disclosures This presentation may contain forward-looking statements that are 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, and such statements are intended to be c
Slide 3: Summary Results
Summary Results See footnotes on page 19 Excludes benefit of forward points on currency hedges related to loans denominated in currencies other than USD $582 million Current Liquidity Financial Results Capitalization Loan Portfolio 1.6x Debt-to-Equity Ratio1 $1.1 billion Current Unencumbered Loan As
Slide 4: Income Statement and Financial Summary
Income Statement ($ and shares in mm, except for per share data) Net interest income Net (loss) available to common stockholders Diluted weighted average shares of common stock outstanding Net (loss) per diluted share of common stock5 Operating Earnings3 Diluted weighted average shares of common sto
Slide 5: Business Update
Business Update Portfolio Update April interest payments were strong (~99% received)a Majority of sponsors are well capitalized institutional investors Assets predominately located in gateway cities across the United States and Western Europe Only securities in portfolio are two single-asset, single
Slide 6: Capital Structure Overview
Capital Structure Overview See footnotes on page 19 Capital Structure Detail Capital Structure Composition ($ in mm) $2,296 $3,557 $496 $575 $169 8 10 11 9 12 ~42% Secured Credit Facilities Look-Through LTVa ~67% W.A. Advance Rate Across Secured Credit Facilities 1.6x Debt to Equity Ratio1 2.3x Fixe
Slide 7: Liquidity
Liquidity as of 3/31/20 See footnotes on page 19 Liquidity ($ in mm) Current Liquidity as of 5/6/20 Operating cash flow $1.1 billion of unencumbered loan assets Loan repayments and amortization ($1.3 billion of final maturities through 202110,13) Additional Sources of Liquidity Cash on hand Approved
Slide 8: Q1 Investment Activity
Q1 Investment Activity Outstanding Portfolio 16 ($ in mm) Excludes benefit of forward points on currency hedges related to loans denominated in currencies other than USD Total increase in General and Specific CECL Allowances on funded portfolio was $208 million, including $30.9 million from adoption
Slide 9: Q1 Investment and Repayment Activity & Subsequent Events
Q1 Investment and Repayment Activity & Subsequent Events See footnotes on page 19 Summary of New Investments Summary of Repayments and Sales Subsequent Events $290.0 million ($169.1 million of which was funded at closing) of a $580.0 million floating-rate mortgage loan secured by an office tower in
Slide 10: Loan Portfolio Overview
($ in mm) 3/31/2020 12/31/2019 Number of Loans 75 Loans 72 Loans Total Investments, net $6,431 $6,375 Invested Net Equity, at Cost20 $2,874 $3,280 Weighted Average Unlevered All-in Yield on Loan Portfolio4,a 6.7% 7.4% Weighted Average Remaining Fully-Extended Term13 3.3 Years 3.3 Years Weighted Aver
Slide 11: Loan Portfolio Diversification
New York City 36% West 11% Midwest 9% Southeast 8% Southwest 3% Northeast 2% Loan Portfolio Diversification See footnotes on page 19 ($ in mm) 12 Other US includes the following geographies: Southwest (3%), Northeast (2%), and Mid-Atlantic (1%) Other property types include the following property typ
Slide 12: Senior Loan Portfolio Overview (Page 1 of 2)
See footnotes on page 19 Senior Loan Portfolio Overview (Page 1 of 2) 10, 13 ($ in mm) Subsequent to quarter end, 39% of loan was sold Loan was sold subsequent to quarter end b 21 21 a
Slide 13: Senior Loan Portfolio Overview (Page 2 of 2)
See footnotes on page 19 Senior Loan Portfolio Overview (Page 2 of 2) Loan was sold subsequent to quarter end ($ in mm) 10, 13 a 21 21 21 21 12
Slide 14: Subordinate Loan Portfolio Overview
Subordinate Loan19 Portfolio Overview In the form of a single-asset, single-borrower CMBS ($ in mm) See footnotes on page 19 10, 13 21 a a 22 22 12 12
Slide 15: Future Fundings and Maturities Profile
Future Fundings and Maturities Profile See footnotes on page 19 Fully Extended Loan Maturities10,13 ($ in mm) Expected Future Fundings23,a May – December 2020 Sold interests in three construction loans subsequent to quarter end, eliminating $173 million of future funding commitments $1.2 billion in
Slide 16: Apollo Commercial Real Estate Finance
APOLLO | commercial Real Estate Finance
Slide 17: Consolidated Balance Sheets
(in thousands - except share data) March 31, 2020 December 31, 2019 f Assets: Cash and cash equivalents $582,138 $452,282 Commercial mortgage loans, net (a)(b) 5,413,627 5,326,967 Subordinate loans and other lending assets, net (b) 1,016,991 1,048,126 Other assets 103,869 52,716 Derivative assets, n
Slide 18: Consolidated Statements of Operations
(in thousands - except share and per share data) Three months ended March 31, 2020 March 31, 2019 Net interest income: Interest income from commercial mortgage loans $81,855 $78,286 Interest income from subordinate loans and other lending assets 34,018 40,839 Interest expense (41,205 ) (36,295 ) Net
Slide 19: Operating Earnings Reconciliation
(in thousands - except share and per share data) Three months ended Three months ended Operating Earnings3: December 31, 2019 March 31, 2020 March 31, 2019 Net income (loss) available to common stockholders $68,517 ($131,227 ) $60,923 Adjustments: Equity-based compensation expense 3,813 4,263 3,901
Slide 20: Footnotes
Footnotes Represents total debt, less cash and loan proceeds held by servicer divided by total stockholders' equity, adjusted to add back the General CECL Allowance in line with our covenants. Represents loan assets with no asset-specific financing. Pursuant to our Term Loan B agreement, we are requ
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