Adamas Trust, Inc. · NASDAQ:ADAM
Adamas Trust — New York Mortgage Trust — Q1 2022 Earnings Presentation
44 slides from Adamas Trust's earnings presentation, May 4, 2022
Slide 1: 2022 First Quarter Financial Summary
New York Mortgage Trust 2022 First Quarter Financial Summary
Slide 2: Forward Looking Statements
Forward Looking Statements This presentation contains forward-looking statements within the meaning of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are based on our beliefs, assumptions and expectations of our future performance, taki
Slide 3: To Our Stockholders
To Our Stockholders Management Update “In a challenging quarter with the Fed attempting to regain control of inflation, markets experienced heightened volatility, particularly with respect to interest rates. The volatility combined with a rapidly rising interest rate environment caused the fixed inc
Slide 4: Table of Contents
Table of Contents Company Overview Financial Summary Market & Strategy Update Quarterly Comparative Financial Information Appendix Non-GAAP Financial Measures Glossary End Notes Capital Allocation Reconciliation of Net Interest Income Reconciliation of Joint Venture Equity Investments
Slide 5: Company Overview
Company Overview
Slide 6: NYMT Overview
NYMT Overview New York Mortgage Trust, Inc. (NASDAQ: NYMT) is a real estate investment trust Capital Allocation (“REIT”) for U.S. federal income tax purposes in the business of acquiring, investing in, financing and managing primarily mortgage-related single-family and multi-family Single-Family Mul
Slide 7: Key Developments
Key Developments ◦ Loss per share of $(0.22), Comprehensive loss per share of $(0.23) ◦ Undepreciated loss per share of $(0.17)* Financial ◦ Book value per share of $4.36 Performance ◦ Undepreciated book value per share of $4.45* (-6% change QoQ) ◦ (5.1)% Quarterly Economic Return ◦ (4.0)% Quarterly
Slide 8: Financial Summary
Financial Summary First Quarter 2022
Slide 9: Financial Snapshot
Financial Snapshot Loss Per Share Dividend Per Share Net Interest Margin Basic Comprehensive Q1 Dividend $0.10 3.87% $(0.22) $(0.23) Earnings & Economic Return on 3.63% Book Value 3.25% Undepreciated Loss Undepreciated Undepreciated Book Value* 2.97% Per Share* Book Value* 3 Months Ended 2.42% $(0.1
Slide 10: Financial Results
Financial Results Net Interest Income: in millions First Quarter Profit & Loss Portfolio Net Interest Income $ 39.5 Dollar amounts in millions, except per share data Interest Expense: Corporate Debt (2.5) Interest Expense: Mortgages payable on real estate (7.1) Net Interest Income $ 29.9 Total Net I
Slide 11: Quarterly Summary
Quarterly Summary Dollar amounts in millions 1Q 2022 4Q 2021 Investment Activity Acquisitions $ 984.6 $ 851.0 Sales $ (24.7) $ (193.8) Prepayments and Redemptions $ (315.1) $ (332.5) Net Investment Activity $ 644.8 $ 324.7 (Loss) Earnings Net (Loss) Earnings Attributable to Common Stockholders $ (84
Slide 12: Market & Strategy Update
Market & Strategy Update
Slide 13: Strategy Update
Strategy Update A Selective Approach to Growth Market Themes Opportunity Execution U.S. Housing Supply Deficit Residential Investor Lending BPL-Bridge * 73% LTV (at cost) * 1 million units of single-family homes for * Focus on short-term, bridge lending to take $1.4B * 66% LTV (after repair) sale (3
Slide 14: NYMT Investment Strategy
NYMT Investment Strategy Strategy For Sustainable Earnings Growth Portfolio Acquisitions (Dollar amounts in millions) $985 Focus +16% $45 NYMT seeks investment opportunities in markets where $851 the Company finds a competitive advantage due to $157 operational barriers to entry. $56 $68 $189 Execut
Slide 15: NYMT Continues to Enhance Debt Structure
NYMT Continues to Enhance Debt Structure Strategy for Sustainable Financing Quarterly Portfolio Financing Exposure (Dollar amounts in millions) Strategy Portfolio Recourse Leverage Ratio Continue to primarily focus on investments away from 0.2x 0.1x 0.1x 0.2x 0.4x CUSIP securities that do not rely o
Slide 16: Strategy Update: Evolution of Strategy Shift
Strategy Update Evolution of Strategy Shift 1 2 3 Portfolio Re-Lever Cash Utilization Asset Rotation Increase utilization of non-mark-to Deploy cash generated from Shift to higher yielding residential and market structures 2020 loan strategy acceleration multi-family loans 4% $1,200 8% $1,800 $1,200
Slide 17: Single-Family Portfolio Overview
Single-Family Portfolio Overview Total Investment Portfolio Total Capital Target ROE Dollar amounts in millions 81% 63% 12-15% Portfolio Total Asset Value Net Capital Loan Key Characteristics Recourse Portfolio Core Strategy Sub-Sector Current Environment Leverage Leverage Avg. % $ % $ Ratio Ratio A
Slide 18: Single-Family Business Purpose Loan-Bridge Strategy
Single-Family Business Purpose Loan-Bridge Strategy NYMT Expertise Loan Count: 2,593 UPB ($MM): $1,375 Expertise & Background Loan Key Characteristics ◦ Deep experience managing different whole loan Avg. FICO Avg. Coupon Avg. LTARV Avg. LTC strategies across the credit spectrum. ◦ Managed rehabilita
Slide 19: Multi-Family Portfolio Overview
Multi-Family Portfolio Overview Total Investment Portfolio Total Capital Target ROE Dollar amounts in millions 17% 30% 12-17% Asset Value Net Capital Loan Key Characteristics Core Strategy Sub-Sector Current Environment Avg. Coupon/ % $ % $ Avg. DSCR Avg. LTV Target IRR • Sentiment shifted from 2-3
Slide 20: Multi-Family Target Strategy
Multi-Family Target Strategy Asset Summary Style Unit Interiors Common Areas Asset Information ◦ Secondary and Tertiary Markets, primarily South / Southeast Target ◦ Class B- through A- ◦ Garden and Mid-rise product Product ◦ 200 - 400 units ◦ $1,200 - $1,350 average unit rent ◦ Value add opportunit
Slide 21: Multi-Family Target Strategy - Mezzanine Lending
Multi-Family Target Strategy - Mezzanine Lending Total Investment Capital Stack Typical Terms Loan Amount $10 - $20 million Initial LTV 90% - 95% After-Transition LTV 80% - 85% Coupon Accrual 11.0% - 12.0% Minimum Return Multiple 1.3 - 1.5x Loan Amount Expected Term 3 to 6 years Major Rights • Capit
Slide 22: Multi-Family Target Strategy - Joint Venture Equity
Multi-Family Target Strategy - Joint Venture Equity Total Investment Typical Terms Capital Stack Investment Amount $15 - $30 million Capital Stack 75% - 100% Common Equity Share 75% - 95% Target IRR 13% - 17% NYMT Asset Management Fee 0.5% - 1.0% Promote Split (NYMT/Operating Partner) 30% - 40% / 70
Slide 23: Current Focus
Current Focus The Company continues to pursue targeted assets through proprietary channels and prudent liability management to increase profitability and protect book value. Utilize a Strong Balance Sheet to Capture Superior Market Opportunities ◦ Selective investment across residential housing sect
Slide 24: Quarterly Comparative Financial Information
Quarterly Comparative Financial Information
Slide 25: Portfolio Yields by Strategy
Portfolio Yields by Strategy Quarter over Quarter Comparison Portfolio Net Interest Margin (1Q’22 vs 4Q’21) Portfolio net interest margin for the first quarter was 3.87%, an increase of 24 bps from the prior quarter primarily due to continued investment in higher-yielding business purpose loans duri
Slide 26: Net Interest Income
Net Interest Income Quarter over Quarter Comparison Net Interest Income (1Q’22 vs 4Q’21) Portfolio net interest income increased in the current quarter as compared to the previous quarter, primarily due to our continued investment in higher- yielding business purpose loans. The increase in single-fa
Slide 27: Non-Interest (Loss) Income
Non-Interest (Loss) Income Quarter over Quarter Comparison Realized Gains (Losses), net (1Q’22 vs 4Q’21) Net realized gains on residential loans are primarily a result of loan prepayment activity that generated $3.9 million in net realized gains during the quarter. Net realized gains of $0.4 million
Slide 28: Non-Interest (Loss) Income
Non-Interest (Loss) Income Quarter over Quarter Comparison Income from Equity Investments (1Q’22 vs 4Q’21) Preferred return on preferred equity investments accounted for as equity decreased to $5.7 million as a result of redemptions received in the latter portion of the prior quarter and in the curr
Slide 29: Net Loss from Real Estate
Net Loss from Real Estate Quarter over Quarter Comparison Net Loss from Real Estate (1Q’22 vs 4Q’21) The increase in both income from and expenses related to real estate in the first quarter is primarily related to the full quarter impact of multi-family joint venture investments made in the previou
Slide 30: Expense Analysis
Expense Analysis Quarter over Quarter Comparison General and Administrative Expenses (1Q’22 vs 4Q’21) Increase in general and administrative expenses is largely related to increase in commission expense due to record funding of multi-family investments, an increase in salary and stock-based compensa
Slide 31: Other Comprehensive (Loss) Income
Other Comprehensive (Loss) Income Other Comprehensive (Loss) Income (1Q’22 vs 4Q’21) The change in other comprehensive income is primarily due to unrealized losses on investment securities as a result of interest rate increases and spread widening during the first quarter. Dollar Amounts in Thousand
Slide 32: Book Value
Book Value Changes in Book Value The following table analyzes the changes in book value and undepreciated book value* of our common stock for the quarter ended March 31, 2022. Quarter Ended March 31, 2022 Amounts in Thousands, except per share Amount Shares Per Share Beginning Balance, Book Value $
Slide 33: Annual and Quarterly Returns
Annual and Quarterly Returns Economic/Total Rate Economic Return: Change in Book Value for the period + Dividends declared for the period, divided by the beginning period Book Value. Economic Return on Undepreciated Book Value:* Change in Undepreciated Book Value for the period + Dividends declared
Slide 34: Appendix
Appendix
Slide 35: Non-GAAP Financial Measures
Non-GAAP Financial Measures In addition to the results presented in accordance with GAAP, this supplemental presentation includes certain non-GAAP financial measures, including undepreciated earnings and undepreciated book value per common share. Our management team believes that these non-GAAP fina
Slide 36: Glossary
Glossary The following defines certain of the commonly used terms in this presentation: "Agency" refers to CMBS or RMBS representing interests in or obligations backed by pools of mortgage loans issued and guaranteed by a government sponsored enterprise (“GSE”), such as the Federal National Mortgage
Slide 37: Glossary
Glossary "JV" refers to joint venture; "LTARV" refers to loan-to-after repair value ratio; "LTC" refers to loan-to-cost ratio; "LTV" refers to loan-to-value ratio; "Market Capitalization" is the outstanding shares of common stock and preferred stock multiplied by closing common stock and preferred s
Slide 38: End Notes
End Notes Slide 1 • LTV (at cost) represents the weighted average loan-to-cost calculated using • Image(s) used under license from Shutterstock.com. the initial loan amount at origination (exclusive of any debt service, rehab Slide 3 escrows and other escrows or other amounts not funded to the borro
Slide 39: End Notes
End Notes • Investment Securities represents the fair value of investment securities, Slide 18 available for sale held at quarter-end for each of the periods indicated. • UPB represents the interest bearing balance of the BPL-Bridge Investment securities, available for sale does not include Consolid
Slide 40: End Notes
End Notes Slide 19 Slide 23 • As of March 31, 2022. Refer to Appendix - "Capital Allocation" for a • Image(s) used under license from Shutterstock.com. detailed breakout of Total Investment Portfolio, Total Capital, and Net Slide 25 Capital. • Portfolio Total Avg. Interest Earning Assets, Portfolio
Slide 41: Capital Allocation
Capital Allocation At March 31, 2022 (Dollar Amounts in Thousands) Single-Family (1) Multi-Family Other Total Residential loans $ 3,953,427 $ — $ — $ 3,953,427 Consolidated SLST CDOs (754,264) — — (754,264) Multi-family loans — 110,208 — 110,208 Investment securities available for sale 75,499 31,576
Slide 42: Reconciliation of Net Interest Income
Reconciliation of Net Interest Income Dollar Amounts in Thousands 1Q'22 4Q'21 3Q'21 2Q'21 1Q'21 Single-Family Interest income, residential loans $ 41,467 $ 33,587 $ 31,488 $ 30,088 $ 27,630 Interest income, investment securities available for sale 1,954 3,348 4,527 4,039 4,415 Interest income, Conso
Slide 43: Reconciliation of Joint Venture Equity Investments
Reconciliation of Joint Venture Equity Investments Dollar Amounts in Thousands At March 31, 2022 Cash and cash equivalents $ 33,340 Real estate, net 1,451,053 (a) Lease intangible, net 41,759 Other assets 23,153 Total assets $ 1,549,305 Mortgages payable on real estate, net $ 1,083,371 Other liabili
Slide 44: Thank You
Thank You From all of us at NYMT
New York Mortgage Trust — Q1 2022 Earnings Presentation on 6ix