Adamas Trust, Inc. · NASDAQ:ADAM
Adamas Trust — New York Mortgage Trust — Q4 2021 Earnings Presentation
49 slides from Adamas Trust's earnings presentation, Feb 18, 2022
Slide 1: 2021 Fourth Quarter Financial Summary
New York Mortgage Trust 2021 Fourth 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, tak
Slide 3: To Our Stockholders: Management Update
To Our Stockholders Management Update “The Company’s investment portfolio was transformed over the course of 2021 by our continued pursuit of organically-sourced opportunities through proprietary loan and joint venture pipelines. This strategic focus culminated in the fourth quarter with record 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 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 ◦ Earnings per share $0.06, Comprehensive earnings per share $0.06 ◦ Undepreciated earnings per share $0.08* ◦ Book value per share of $4.70 (-$0.04 change QoQ) Financial ◦ Undepreciated book value per share of $4.74* (-$0.02 change QoQ) Performance ◦ Achieved 1.3% Quarterly and 8.3
Slide 8: Subsequent Developments
Subsequent Developments ◦ Purchased $254 million of residential loans and funded $71 million of new Investing ◦ multi-family joint venture investments (as of 2/9/22) Activity ◦ Q1 2022 on pace to exceed historical Q4 2021 investment activity ◦ Issued $288 million rated RMBS securitization with a 2.3
Slide 9: Financial Summary
Financial Summary Fourth Quarter 2021
Slide 10: Financial Snapshot
Financial Snapshot Earnings Per Share Dividend Per Share Net Interest Margin Basic Comprehensive Q4 Dividend $0.06 $0.06 $0.10 Earnings & Book Value Economic Return on 3.63% 2.97% 3.25% Undepreciated Undepreciated Undepreciated Book Value* 2.42% 2.30% Earnings Per Share* Book Value* 3 Months Ended $
Slide 11: Financial Results
Financial Results Fourth Quarter Profit & Loss Dollar amounts in millions, except per share data Non-Interest Income: in millions Net Interest Income $ 30.8 Realized Gains $ 1.1 Unrealized Gains 15.5 Non-Interest Income 39.3 Preferred Return on Mezzanine Lending 7.2 Total Net Interest Income & Non-I
Slide 12: Fourth Quarter and Full Year Summary
Fourth Quarter and Full Year Summary Dollar amounts in millions 4Q 2021 FY 2021 Investment Activity Acquisitions $ 851.0 $ 2,009.9 Sales $ (193.8) $ (509.7) Prepayments and Redemptions $ (332.5) $ (1,131.9) Net Investment Activity $ 324.7 $ 368.3 Earnings Net Income Attributable to Common Stockholde
Slide 13: Market & Strategy Update
Market & Strategy Update
Slide 14: Strategy Update: A Selective Approach to Growth
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) * Existing home inventory for sale continues $993MM * Focus on short-term, bridge lending to * 65% LTV (after repair) to fall – n
Slide 15: Strategy Update: Organic Growth Structured Around Proprietary Sourcing
Strategy Update Organic Growth Structured Around Proprietary Sourcing Core Strategy Development ◦ In Q4 2021, NYMT entered into a flow agreement with a BPL-Rental originator, guaranteeing NYMT 50% of production. ◦ Continue to grow direct BPL funding on a monthly basis from more than 3 BPL-Bridge ori
Slide 16: NYMT Investment Strategy
NYMT Investment Strategy Strategy For Sustainable Earnings Growth Portfolio Acquisitions (Dollar amounts in millions) $851 Focus $56 NYMT seeks investment opportunities in markets where the Company finds a competitive advantage due to operational barriers to entry. $189 +69% $505 $133 $490 Safety $3
Slide 17: Strategy Update: Evolution of Strategy Shift
Strategy Update Evolution of Strategy Shift 1 2 3 Cash Utilization Portfolio Re-Lever Asset Rotation Deploy cash generated from Increase utilization of non-mark-to Shift to higher yielding residential and 2020 loan strategy acceleration market structures multi-family loans $1,000 4% $1,200 8% $1,000
Slide 18: Strategy Update: Significant Reinvestment Opportunity
Strategy Update Significant Reinvestment Opportunity Cash Available through Q1 2022 Expected Financing Activities: Asset Re-Capitalization $181MM $106MM $75MM Unencumbered Asset Financing $607MM $478MM $129MM Total $788MM $584MM $204MM *Portfolio Recourse Leverage Ratio expected to Completed as of 2
Slide 19: 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 0.2x 0.1x 0.1x 0.2x CUSIP securities that do not rely o
Slide 20: Single-Family Portfolio Overview
Single-Family Portfolio Overview Total Investment Portfolio Total Capital Target ROE Dollar amounts in millions 81% 74% 12-15% Portfolio Total Asset Value Net Capital Loan Key Characteristics Recourse Portfolio Core Strategy Sub-Sector Current Environment Leverage Leverage % $ % $ Ratio Ratio Avg. F
Slide 21: Single-Family Portfolio Highlights
Single-Family Portfolio Highlights RPL Performance Update Quarterly Update WT. Avg. Price Q4 Portfolio Activity 12/31/21 65% 35% $100 ◦ Purchased $606 million of residential loans, including: – $388 million BPL - Bridge 9/30/21 66% 34% $97 – $133 million S&D – $85 million BPL - Rental 6/30/21 64% 36
Slide 22: Single-Family Business Purpose Loan-Bridge Strategy
Single-Family Business Purpose Loan-Bridge Strategy NYMT Expertise Loan Count: 2,028 UPB ($MM): $989 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 rehabilitati
Slide 23: Multi-Family Portfolio Overview
Multi-Family Portfolio Overview Total Investment Portfolio Total Capital Target ROE Dollar amounts in millions 17% 25% 12-17% Asset Value Net Capital Loan Key Characteristics Core Strategy Sub-Sector Current Environment Avg. Coupon/ % $ % $ Avg. DSCR Avg. LTV Target IRR • Increasing opportunities to
Slide 24: Multi-Family Opportunity Highlights
Multi-Family Opportunity Highlights Quarterly Update Mezzanine Portfolio Characteristics as of 12/31/2021 (Dollar amounts in millions) Property Operating Update State Count Balance % Total Coupon LTV DSCR ◦ Portfolio occupancy rate improved to an average of 94.3% in December 2021 from an average of
Slide 25: Multi-Family Origination Platform
Multi-Family Origination Platform NYMT Expertise Current Portfolio Loan Count: 2,028 UPB ($MM): $989 Since 2014, originated approximately $1.0 billion of Investments totaled $573 million at YE 2021 Mezzanine Lending and Joint Ventures for a 15% return. ◦ Migration to affordable MSAs fueled rental de
Slide 26: Multi-Family Target Strategy
Multi-Family Target Strategy ◦ Invest in lower market quality product as a value play ◦ Utilize strategic capex plan to improve rent growth Style Unit Interiors Common Target Product to Houston, TX Houston, TX Beaufort, SC Market Competition Austin, TX Houston, TX Pooler, GA See Glossary and End Not
Slide 27: Current Focus
Current Focus The Company continues to focus on asset growth through proprietary channels and prudent liability management to increase profitability. Utilize a Strong Balance Sheet to Capture Superior Market Opportunities ◦ Invest across capital structures and sectors to locate compelling risk-adjus
Slide 28: Quarterly Comparative Financial Information
Quarterly Comparative Financial Information
Slide 29: Portfolio Yields by Strategy
Portfolio Yields by Strategy Quarter over Quarter Comparison Portfolio Net Interest Margin (4Q’21 vs 3Q’21) Portfolio net interest margin for the fourth quarter was 3.63%, an increase of 38 bps from the prior quarter primarily due to 1) continued investment in higher-yielding business purpose loans
Slide 30: Net Interest Income
Net Interest Income Quarter over Quarter Comparison Net Interest Income (4Q’21 vs 3Q’21) Net interest income was relatively flat for the quarter as compared to the previous quarter. Our continued investment in higher-yielding business purpose loans during the quarter contributed to the $0.9 million
Slide 31: Non-Interest Income (Loss)
Non-Interest Income (Loss) Quarter over Quarter Comparison Realized Gains (Losses), net (4Q’21 vs 3Q’21) Net realized gains on residential loans are primarily a result of loan prepayment activity that generated $5.1 million in net realized gains during the quarter. Net realized losses of $4.1 millio
Slide 32: Non-Interest Income (Loss): Equity Investments
Non-Interest Income (Loss) Quarter over Quarter Comparison Income from Equity Investments (4Q’21 vs 3Q’21) Preferred return on preferred equity investments accounted for as equity increased to $7.2 million as a result of an increase in these investments during the quarter. The fair value of the Comp
Slide 33: Net Loss from Real Estate
Net Loss from Real Estate Quarter over Quarter Comparison Net Loss from Real Estate (4Q’21 vs 3Q’21) The increase in both income from and expenses related to real estate in the fourth quarter is primarily related to the full quarter impact of multi- family joint venture investments made in the previ
Slide 34: Expense Analysis
Expense Analysis Quarter over Quarter Comparison General and Administrative Expenses (4Q’21 vs 3Q’21) Increase in compensation expenses is largely related to an increase in bonus accruals during the fourth quarter. Decrease in other general and administration is primarily attributable to the decreas
Slide 35: Other Comprehensive Income (Loss)
Other Comprehensive Income (Loss) Other Comprehensive Income (Loss) (4Q’21 vs 3Q’21) The change in other comprehensive income is primarily due to unrealized losses on certain non-Agency RMBS recognized during the fourth quarter, partially offset by previously recognized unrealized losses that were r
Slide 36: 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 and year ended December 31, 2021. Quarter Ended December 31, 2021 Year Ended December 31, 2021 Amounts in Thousands, except per share Amount Share
Slide 37: 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 38: Appendix
Appendix
Slide 39: 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 40: 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 41: Glossary
Glossary "IOs" refers collectively to interest only and inverse interest only mortgage-backed securities that represent the right to the interest component of the cash flow from a pool of mortgage loans; "LTARV" refers to loan-to-after repair value ratio; "LTC" refers to loan-to-cost ratio; "LTV" re
Slide 42: End Notes
End Notes Slide 1 • BPL-Bridge, S&D and Mezzanine Lending/JV percentages represent the • Image(s) used under license from Shutterstock.com. percentage of the Total Investment Portfolio as of December 31, 2021 (see Slide 3 Appendix - "Capital Allocation"). • Image(s) used under license from Shutterst
Slide 43: End Notes
End Notes Slide 18 • Average FICO and Average Coupon for RPL Strategy, BPL-Bridge • Incremental EPS Growth Potential represents incremental undepreciated Strategy , BPL-Rental Strategy and Performing Loan Strategy earnings per share on deployment of cash proceeds from Q1 2022 financing represent the
Slide 44: End Notes
End Notes • Percentages in the S&D Loan Prepayment Activity table represent the • Refer to Appendix - "Reconciliation of Joint Venture Equity Investments" annualized prepayment rate for the month indicated. for a detailed breakout of the Company's equity investments in multi- Slide 22 family apartme
Slide 45: End Notes
End Notes Slide 29 • Portfolio Total Avg. Interest Earning Assets, Portfolio Total Yield on Average Interest Earning Assets and Portfolio Net Interest Margin include amounts related to our “Other” portfolio not shown separately within the table. Slide 30 • Refer to Appendix - “Reconciliation of Net
Slide 46: Capital Allocation
Capital Allocation At December 31, 2021 (Dollar Amounts in Thousands) Single-Family (1) Multi-Family Other Total Residential loans $ 3,575,601 $ — $ — $ 3,575,601 Consolidated SLST CDOs (839,419) — — (839,419) Multi-family loans — 120,021 — 120,021 Investment securities available for sale 128,019 33
Slide 47: Reconciliation of Net Interest Income
Reconciliation of Net Interest Income Dollar Amounts in Thousands 4Q'21 3Q'21 2Q'21 1Q'21 4Q'20 Single-Family Interest income, residential loans $ 33,587 $ 31,488 $ 30,088 $ 27,630 $ 21,899 Interest income, investment securities available for sale 3,348 4,527 4,039 4,415 4,892 Interest income, Conso
Slide 48: Reconciliation of Joint Venture Equity Investments
Reconciliation of Joint Venture Equity Investments Dollar Amounts in Thousands At December 31, 2021 Cash and cash equivalents $ 30,130 Real estate, net 978,834 (a) Lease intangible, net 39,769 Other assets 31,006 Total assets $ 1,079,739 Mortgages payable on real estate, net $ 709,356 Other liabilit
Slide 49: Thank You
Thank You From all of us at NYMT
New York Mortgage Trust — Q4 2021 Earnings Presentation on 6ix