Adamas Trust, Inc. · NASDAQ:ADAM
Adamas Trust — New York Mortgage Trust — Q3 2022 Earnings Presentation
46 slides from Adamas Trust's earnings presentation, Nov 3, 2022
Slide 1: New York Mortgage Trust 2022 Third Quarter Financial Summary
New York Mortgage Trust 2022 Third 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: Management Update
To Our Stockholders Management Update “The historic rate volatility witnessed in September that was driven by heightened inflationary fears sharply lowered asset prices across the fixed income markets. Our pivot to effectively halting asset pipeline activity throughout the entirety of the third quar
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 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 $(0.33), Comprehensive loss per share of $(0.34) ◦ Undepreciated loss per share of $(0.27)* Financial ◦ Book value per share of $3.65 Performance ◦ Undepreciated book value per share of $3.89* (-8.3% change QoQ) ◦ (7.6)% Quarterly Economic Return ◦ (5.9)% Quarter
Slide 8: Financial Summary
Financial Summary Third Quarter 2022
Slide 9: Financial Snapshot
Financial Snapshot Net Interest Spread*(1) & EPS Contribution Loss Per Share Undepreciated Loss Basic Comprehensive Per Share* $0.09 $0.10 $0.10 $(0.33) $(0.34) $(0.27) $0.08 $0.08 Earnings & Book Value Economic Return on 3.60% 3.60% 3.34% 3.34% Dividend Per Share Undepreciated Undepreciated Book Va
Slide 10: Financial Results: Third Quarter Profit & Loss
Financial Results Third Quarter Profit & Loss Dollar amounts in millions, except per share data Description Amount EPS Contribution Notes Interest income $ 68.9 $ 0.18 Includes $16mm ($0.04 of EPS) of interest expense related to Interest expense (54.7) (0.14) mortgages payable on real estate Net Int
Slide 11: Market & Strategy Update
Market & Strategy Update
Slide 12: Strategy Update: A Cautious Approach to Growth
Strategy Update A Cautious Approach to Growth The market is undergoing a seismic shift: - U.S. housing market underpinned by a multi-decade low of U.S. units available for sale is now slowing - Market’s reaction to such change is in early stages 1H'22 Q3'22 Q4'22 2023 Dislocated Deep NYMT Par + / Di
Slide 13: NYMT Investment Strategy
NYMT Investment Strategy Strategy For Sustainable Earnings Growth Portfolio Acquisitions (Dollar amounts in millions) $985 $45 $890 $851 Portfolio Dynamics $157 $60 NYMT investment strategy focused on growth of higher $56 $57 yielding short-duration bridge loans to generate interest $68 $91 income w
Slide 14: NYMT Continues to Enhance Debt Structure
NYMT Continues to Enhance Debt Structure Strategy to Utilize Cash without Restrictions Quarterly Portfolio Financing Exposure (Dollar amounts in millions) Portfolio Financing Strategy to Optimize Cash Portfolio Recourse Leverage Ratio Continue to de-risk from mark-to-market financing arrangements to
Slide 15: Balance Sheet Summary
Balance Sheet Summary Portfolio Positioning (dollar amounts in millions) Portfolio Assets Portfolio and Corporate Debt 1 Lower duration BPL Bridge $1,548 34% 100% fixed rate debt – portfolio returns held at par on balance capital faster to sheet reinvest in higher Securitization Debt 1 yielding $1,3
Slide 16: Single-Family Portfolio Overview
Single-Family Portfolio Overview Total Investment Portfolio Total Capital Target ROE Dollar amounts in millions 83% 55% 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 17: Single-Family Business Purpose Loan-Bridge Strategy
Single-Family Business Purpose Loan-Bridge Strategy NYMT Focus Loan Count: 2,629 UPB ($MM): $1,563 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 rehabilitation
Slide 18: Multi-Family Portfolio Overview
Multi-Family Portfolio Overview Total Investment Portfolio Total Capital Target ROE Dollar amounts in millions 16% 36% 12-17% Asset Value Net Capital Loan Key Characteristics Core Strategy Sub-Sector Current Environment Avg. Coupon/ % $ % $ Avg. DSCR Avg. LTV Target IRR • After favoring equity capit
Slide 19: Multi-Family Asset Class - Mezzanine Lending
Multi-Family Asset Class - Mezzanine Lending Quarterly Update Property Operating Update Loan Performance Update ◦ Two loans with outstanding UPB of $19 million paid off in ◦ Portfolio occupancy of approximately 93% as of September 30, 2022. the quarter at an average lifetime IRR to NYMT of 17.66% (1
Slide 20: Multi-Family Asset Class - Joint Venture Equity
Multi-Family Asset Class - Joint Venture Equity Joint Venture Equity Portfolio Characteristics as of 9/30/2022 • Mostly Garden concept, 300+ units, located in high growth southern markets • 2021 and 2022 average rent growth of 16% and 17%, respectively • After implementing $1.4mm of capital improvem
Slide 21: Current Focus
Current Focus The Company is focused on opportunities in a market undergoing a landscape change and offering deep discount pricing. Success in this new environment may be achieved through organic creation of liquidity, tactical asset management and prudent liability management for book value protect
Slide 22: Quarterly Comparative Financial Information
Quarterly Comparative Financial Information
Slide 23: Yields by Strategy
Yields by Strategy Quarter over Quarter Comparison Net Interest Spread (3Q’22 vs 2Q’22) Net Interest Spread for the third quarter was 2.18%, a decrease of 116 bps from the prior quarter primarily due to an increase in financing costs as a result of a residential loan securitization issued during the
Slide 24: Adjusted Net Interest Income
Adjusted Net Interest Income* Quarter over Quarter Comparison Adjusted Net Interest Income* (3Q’22 vs 2Q’22) Adjusted Net Interest Income decreased in the third quarter as compared to the previous quarter, primarily due to an increase in financing costs as a result of a residential loan securitizati
Slide 25: Non-Interest (Loss) Income: Realized and Unrealized
Non-Interest (Loss) Income Quarter over Quarter Comparison Realized Gains (Losses), net (3Q’22 vs 2Q’22) Net realized gains on investment securities are primarily a result of sale of certain investment securities during the quarter. Net realized gains on residential loans are primarily a result of l
Slide 26: Non-Interest (Loss) Income: Equity Investments
Non-Interest (Loss) Income Quarter over Quarter Comparison (Loss) Income from Equity Investments (3Q’22 vs 2Q’22) The loss from equity investments in the third quarter is primarily related to the decrease in the fair value of our preferred equity investments, unconsolidated joint venture equity inve
Slide 27: Net Income (Loss) from Real Estate
Net Income (Loss) from Real Estate Quarter over Quarter Comparison Net Income (Loss) from Real Estate (3Q’22 vs 2Q’22) The increase in net income from real estate during the quarter was primarily due to the following: a) net gain recognized on the sale of the underlying apartment community in a cons
Slide 28: Expense Analysis
Expense Analysis Quarter over Quarter Comparison General and Administrative Expenses (3Q’22 vs 2Q’22) Quarterly general and administrative expenses decreased primarily as a result of both annual board compensation payments and commission expense incurred in the second quarter. Dollar Amounts in Thou
Slide 29: Other Comprehensive (Loss) Income
Other Comprehensive (Loss) Income Other Comprehensive (Loss) Income (3Q’22 vs 2Q’22) The change in other comprehensive loss is primarily due to unrealized losses on investment securities as a result of interest rate increases and credit spread widening during the third quarter. Dollar Amounts in Tho
Slide 30: Book Value
Book Value Changes in Book Value The following table analyzes the changes in GAAP Book Value and Undepreciated Book Value* of our common stock for the quarter ended September 30, 2022. Quarter Ended September 30, 2022 Amounts in Thousands, except per share Amount Shares Per Share Beginning Balance,
Slide 31: Annual and Quarterly Returns
Annual and Quarterly Returns Economic/Total Rate Economic Return: Change in book value per share for the period + Dividend per share declared for the period, divided by the beginning period book value per share. Economic Return on Undepreciated Book Value:* Change in Undepreciated Book Value per sha
Slide 32: Appendix
Appendix
Slide 33: Non-GAAP Financial Measures
Non-GAAP Financial Measures Adjusted Net Interest Income and Net Interest Spread In addition to the results presented in accordance with GAAP, this supplemental presentation includes certain non-GAAP financial measures, including adjusted interest income, adjusted interest expense, adjusted net inte
Slide 34: Reconciliation of Single-Family Adjusted Net Interest Income
Non-GAAP Financial Measures Reconciliation of Single-Family Adjusted Net Interest Income Dollar Amounts in Thousands 3Q'22 2Q'22 1Q'22 4Q'21 3Q'21 Single-Family GAAP interest income $ 64,278 $ 62,468 $ 52,801 $ 46,837 $ 46,260 GAAP interest expense (36,221) (26,472) (18,953) (14,596) (15,279) GAAP t
Slide 35: Reconciliation of Multi-Family Adjusted Net Interest Income
Non-GAAP Financial Measures Reconciliation of Multi-Family Adjusted Net Interest Income Dollar Amounts in Thousands 3Q'22 2Q'22 1Q'22 4Q'21 3Q'21 Multi-Family GAAP interest income $ 3,414 $ 3,258 $ 3,312 $ 3,767 $ 4,247 GAAP interest expense (16,166) (13,262) (7,169) (2,078) (1,147) GAAP total net i
Slide 36: Reconciliation of Total Adjusted Net Interest Income
Non-GAAP Financial Measures Reconciliation of Total Adjusted Net Interest Income Dollar Amounts in Thousands 3Q'22 2Q'22 1Q'22 4Q'21 3Q'21 GAAP interest income $ 68,920 $ 68,020 $ 58,501 $ 52,318 $ 52,323 GAAP interest expense (54,699) (41,891) (28,622) (21,546) (21,292) GAAP total net interest inco
Slide 37: Undepreciated (Loss) Earnings
Non-GAAP Financial Measures Undepreciated (Loss) Earnings Undepreciated (Loss) Earnings is a supplemental non-GAAP financial measure defined as GAAP net (loss) income attributable to Company's common stockholders excluding the Company's share in depreciation expense and lease intangible amortization
Slide 38: Undepreciated Book Value Per Common Share
Non-GAAP Financial Measures Undepreciated Book Value Per Common Share Undepreciated Book Value per common share is a supplemental non-GAAP financial measure defined as GAAP book value excluding the Company's share of cumulative depreciation and lease intangible amortization expenses related to opera
Slide 39: Glossary
Glossary The following defines certain of the commonly used terms in this presentation: "Adjusted Interest Income" (a supplemental non-GAAP financial measure) is calculated by reducing GAAP interest income by the interest expense recognized on Consolidated SLST CDOs; "Adjusted Interest Expense" (a s
Slide 40: Glossary
Glossary "Economic Return on Undepreciated Book Value" is calculated based on the periodic change in undepreciated book value per common share, a supplemental non-GAAP measure, plus dividends declared per common share during the respective periods; "IOs" refers collectively to interest only and inve
Slide 41: End Notes
End Notes Slide 1 Slide 14 • Image(s) used under license from Shutterstock.com. • MTM Repo includes MTM repurchase agreement financing subject to Slide 6 margin calls. • Refer to Appendix - "Capital Allocation" for a detailed breakout of Capital • Non-MTM Repo includes non-MTM repurchase agreement f
Slide 42: End Notes
End Notes • Available Cash is calculated as unrestricted cash of $370.5 million less • Average LTV for RPL Strategy, BPL-Rental Strategy and $33.8 million of cash held by the Company's consolidated multi-family Performing Loan Strategy represents the weighted average loan-to- properties. value for r
Slide 43: End Notes
End Notes • Amounts underlying the Distribution of Project Rehab Costs table were • LTV represents the weighted average combined LTV of the underlying calculated using the initial cost basis, construction estimate and the outstanding properties as of September 30, 2022. UPB as of September 30, 2022.
Slide 44: Capital Allocation
Capital Allocation At September 30, 2022 (Dollar Amounts in Thousands) Single-Family (1) Multi-Family Corporate/Other Total Residential loans $ 3,933,176 $ — $ — $ 3,933,176 Consolidated SLST CDOs (660,069) — — (660,069) Multi-family loans — 95,829 — 95,829 Investment securities available for sale 7
Slide 45: Reconciliation of Joint Venture Equity Investments
Reconciliation of Joint Venture Equity Investments Dollar Amounts in Thousands Cash and cash equivalents $ 18,555 Real estate, net 546,118 Assets of disposal group held for sale 1,147,410 Other assets 17,457 Total assets $ 1,729,540 Mortgages payable on real estate, net $ 387,761 Liabilities of disp
Slide 46: Thank You
Thank You From all of us at NYMT
New York Mortgage Trust — Q3 2022 Earnings Presentation on 6ix