Apollo Commercial Real Estate Finance, Inc · NYSE:ARI
Apollo Commercial Real Estate Finance — Q1 2023 Earnings Presentation
21 slides from Apollo Commercial Real Estate Finance's earnings presentation, Apr 27, 2023
Slide 1: Q1 2023 Financial Results
Q1 2023 Financial Results Apollo Commercial Real Estate Finance, Inc. April 2023 Unless otherwise noted, information as of March 31, 2023 It should not be assumed that investments made in the future will be profitable or will equal the performance of the investments shown in this document.
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: ARI Highlights
ARI Highlights Strong Distributable Earnings1,a Significant Dividend Coverage $0.51 1.46x Distributable Earnings1 per Diluted Share of Common Stock Coverage Ratio2 for Dividend per Share of Common Stock Quarter-End Liquidity Well-Positioned for Rising Interest Rates $357 Million 99% Cashb and Availa
Slide 4: Summary Results
Summary Results Net income available to common stockholders of $46 million, or $0.32 per diluted share of common stock Distributable Earnings1,a of $74 million, or $0.51 per diluted share of common stock Financial Results Declared common stock dividends of $0.35 per share for Q1 2023, which im
Slide 5: Per Share Overview
Per Share Overview Distributable Earnings per Share1,a Book Value per Share9 1,a Book Value per Share9 Roll Forward General CECL BVPS excl. General CECL BVPS Allowance & Depreciation Allowance & Depreciation December 31, 2022 $15.54 ($0.24) $15.78 (+) Earnings in excess of dividends $0.16 - $0.16 (-
Slide 6: Portfolio Activity
Portfolio Activity Q1 Portfolio Activity 7 8 Funded $174 million in connection with the refinancing of two floating rate first mortgage loans, secured Full Loan Repayments by a portfolio of luxury single-family and condominium vacation homes located across North America, Central America and the Ca
Slide 7: Capital Structure Overview
Capital Structure Overview Capital Structure Composition Conservative Capital Management Strategy ($ in mm) $881 Million of Unencumbered ~70% Weighted Average Available Loan Assets3 Advance Ratee 2.8x Debt to Equity Ratio10 1.5x Fixed Charge Coverage11 Secured Debt Obligationsa,b,c Corporate Debt Ma
Slide 8: Loan Portfolio Overview
Loan Portfolio Overview W/A Unlevered All-in Yield Number of Loans Carrying Value on Loan Portfolio6,a 55 $8.5 billion 8.6% W/A Remaining Fully-Extended W/A Portfolio Risk Rating12 W/A Portfolio Loan-to-Value12,b Term12,15 3.0 58% 2.8 Years Collateral Diversification Origination Vintage12 Loan Posit
Slide 9: Loan Portfolio Overview (cont'd)
Loan Portfolio Overview (cont’d) ($ in mm) United New Other a 8 Property Type Kingdom York City Europe Southeast Midwest West Northeast Other Total Hotel $177 / 2% $146 / 2% $609 / 7% $359 / 4% $63 / 1% $442 / 5% $8 / 0% $184 / 2% $1,988 / 23% Residential 217 / 3% 1,053 / 12% - 44 / 0% 84 / 3% 72 /
Slide 10: Office Loan Portfolio Overview
Office Loan Portfolio Overview Number of Loans a Carrying Value c Floating Rate 9 Loans $1.4 Billion 99% First Mortgage Loans with 3rd Party Subordinate Debt W/A Loan-to-Value12,b 99% 3 Loans 50% Origination Vintage12 Location Fully Extended Maturities12 a) Excludes one loan which consists of office
Slide 11: Mitigating Foreign Exchange Risk
Mitigating Foreign Exchange Risk ARI is well-positioned for fluctuating foreign exchange rates due to several risk mitigating steps we have taken to structure and fund our non-US loan portfolio and associated secured financing facilities Foreign Exchange Rate Change (Local/USD) % FX Change YoY GBP:
Slide 12: Loan Maturities and Future Funding Profile
Loan Maturities and Future Funding Profile Fully-Extended Loan Maturities and Expected Future Fundings by Net Equity15,16,17 ($ in mm) a a Net Interest Income Sensitivity to Benchmark Rates18,b Benchmark Rates Index Mar-31 Apr-25 SOFR 1M 4.80% 5.00% EURIBOR 3.04% 3.29% SONIA ON 4.18% 4.18% Note: Ass
Slide 13: Senior Loan Portfolio (1 of 3)
Senior Loan Portfolio (1 of 3) ($ in mm) Origination Amortized Unfunded Construction 3rd Party Fully-extended 15 Hotel Date Cost Commitments Loan Subordinate Debt Maturity Location Loan 1 10/2019 $340 $27 Y 08/2024 Various, Spain Loan 2 11/2021 217 15 Y 11/2026 Various, UK/Ireland Loan 3 05/2022 179
Slide 14: Senior Loan Portfolio (2 of 3)
Senior Loan Portfolio (2 of 3) ($ in mm) Origination Amortized Unfunded Construction 3rd Party Fully-extended 15 Retail Date Cost Commitments Loan Subordinate Debt Maturity Location Loan 24 04/2022 $462 $37 04/2027 Various, UK Loan 25 10/2021 400 - 10/2026 Various, UK Loan 26 08/2019 250 - Y 09/2025
Slide 15: Senior Loan Portfolio (3 of 3)
Senior Loan Portfolio (3 of 3) ($ in mm) Origination Amortized Unfunded Construction 3rd Party Fully-extended Healthcare Date Cost Commitments Loan Subordinate Debt Maturity15 Location Loan 42 03/2022 $369 - 03/2027 Various, MA Loan 43 10/2019 156 - 10/2024 Various, UK Subtotal - Healthcare $525 - O
Slide 16: Subordinate Loan Portfolio
Subordinate Loan Portfolio ($ in mm) Origination Amortized Unfunded Construction 3rd Party Fully-extended Residential Date Cost Commitments Loan Subordinate Debt Maturity 15 Location 20 Loan 49 05/2020 $284 - Y 09/2024 Manhattan, NY 20 Loan 50 06/2015 194 - Y 09/2024 Manhattan, NY 19,20 Loan 51 11/2
Slide 17: Appendix
Appendix - Consolidated Balance Sheets - Consolidated Statement of Operations - Reconciliation of GAAP Net Income to Distributable Earnings Private and Confidential 17
Slide 18: Consolidated Balance Sheets
Consolidated Balance Sheets (in thousands - except share data) March 31, 2023 December 31, 2022 Assets: Cash and cash equivalents $331,533 $222,030 Commercial mortgage loans, net a,c 7,879,205 8,121,109 Subordinate loans and other lending assets, net b,c 592,863 560,881 Real estate owned, held for i
Slide 19: Consolidated Statement of Operations
Consolidated Statement of Operations (in thousands - except share and per share data) Three months Ended March 31, 2023 2022 Net interest income: Interest income from commercial mortgage loans $166,147 $84,424 Interest income from subordinate loans and other lending assets 9,707 15,835 Interest expe
Slide 20: Reconciliation of GAAP Net Income to Distributable Earnings
Reconciliation of GAAP Net Income to Distributable Earnings1 (in thousands - except share and per share data) Three Months Ended March 31, Distributable Earnings1: 2023 2022 Net income available to common stockholders: $45,848 $12,170 Adjustments: Equity-based compensation expense 4,358 4,698 Loss (
Slide 21: Footnotes
Footnotes 1. Distributable Earnings is a non-GAAP financial measure that we define as net income available to common stockholders, computed in accordance with GAAP, adjusted for (i) equity-based compensation expense (a portion of which may become cash-based upon final vesting and settlement of award
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