Adamas Trust, Inc. · NASDAQ:ADAM
Adamas Trust — New York Mortgage Trust — Q2 2022 Earnings Presentation
45 slides from Adamas Trust's earnings presentation, Aug 3, 2022
Slide 1: 2022 Second Quarter Financial Summary
New York Mortgage Trust 2022 Second 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 "Despite historical levels of volatility that challenged the markets in the second quarter, the Company was able to limit the decline in its undepreciated book value to 4.7%. The bid for duration remains thin as buyers seemed to wait out the market as spreads mo
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 Single-Family Portfolio Net Interest Income Reconciliation of Joint Venture Equity In
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 $(0.22) ◦ Undepreciated loss per share of $(0.13)* Financial ◦ Book value per share of $4.06 Performance ◦ Undepreciated book value per share of $4.24* (-4.7% change QoQ) ◦ (4.6)% Quarterly Economic Return ◦ (2.5)% Quarter
Slide 8: Financial Summary
Financial Summary Second Quarter 2022
Slide 9: Financial Snapshot
Financial Snapshot Loss Per Share Undepreciated Loss Portfolio Net Interest Margin Basic Comprehensive Per Share* $(0.22) $(0.22) $(0.13) 3.87% Earnings & 3.63% 3.48% Book Value Economic Return on 3.25% Dividend Per Share Undepreciated Undepreciated Book Value* 2.97% Q2 Dividend Book Value* 3 Months
Slide 10: Financial Results
Financial Results Net Interest Income: in millions Second Quarter Profit & Loss Portfolio Net Interest Income* $ 41.5 Dollar amounts in millions, except per share data Interest Expense: Corporate debt (2.2) Interest Expense: Mortgages payable on real estate (13.2) Net Interest Income $ 26.1 Total Ne
Slide 11: Market & Strategy Update
Market & Strategy Update
Slide 12: Strategy Update: A Cautious Approach to Growth
Strategy Update A Cautious Approach to Growth Despite continued strong fundamentals in U.S. housing underpinned by a multi-decade low of U.S. units available for sale, the market is undergoing a seismic shift: 2021 - Q1 '22 Q2 '22 - Q4 '22 2023 NYMT Par + / Discount / Deep Market Discount / Efficien
Slide 13: Strategy Update: Focused Selective Market Opportunities
Strategy Update Focused Selective Market Opportunities Market Themes NYMT Opportunity Portfolio U.S. Housing Supply Residential Investor Lending BPL-Bridge * 73% LTV (at cost) * < 1 million units of single-family homes * Selectively add to short-term, bridge $1.7B * 66% LTV (after repair) for sale c
Slide 14: NYMT Investment Strategy
NYMT Investment Strategy Strategy For Sustainable Earnings Growth Portfolio Acquisitions (Dollar amounts in millions) $985 $45 $890 $851 Focus $157 $60 NYMT seeks investment opportunities in markets where $56 $57 the Company finds a competitive advantage due to $68 $91 operational barriers to entry.
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 0.1x 0.1x 0.2x 0.4x 0.6x CUSIP securities that do not rely o
Slide 16: Balance Sheet Summary: Portfolio Positioning
Balance Sheet Summary Portfolio Positioning (dollar amounts in millions) Portfolio Assets Portfolio and Corporate Debt 100% fixed rate debt – held at par on balance sheet 38% Securitization Debt 1 Lower duration $1,112 | (2.77% WAR) If accounted for at fair 1 BPL Bridge $1,746 35% portfolio returns
Slide 17: 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 18: Single-Family Business Purpose Loan-Bridge Strategy
Single-Family Business Purpose Loan-Bridge Strategy NYMT Expertise Loan Count: 3,104 UPB ($MM): $1,746 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 15% 33% 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 Asset Class - Mezzanine Lending
Multi-Family Asset Class - Mezzanine Lending Quarterly Update Property Operating Update Loan Performance Update ◦ Two loans with outstanding UPB of $10 million paid off in ◦ Portfolio occupancy rate remained stable at approximately 95% as of June 30, 2022. the quarter at an average lifetime IRR to N
Slide 21: Multi-Family Asset Class - Joint Venture Equity
Multi-Family Asset Class - Joint Venture Equity Joint Venture Equity Portfolio Characteristics as of 6/30/2022 • Mostly Garden concept, 300+ units, located in high growth southern markets • 2021 and 2022 rent growth of 16% and 17%, respectively. • Continued to consider opportunities to monetize appr
Slide 22: 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 can be achieved through organic creation of liquidity, tactical asset management and prudent liability management for book value protect
Slide 23: Quarterly Comparative Financial Information
Quarterly Comparative Financial Information
Slide 24: Portfolio Yields by Strategy
Portfolio Yields by Strategy Quarter over Quarter Comparison Portfolio Net Interest Margin (2Q’22 vs 1Q’22) Portfolio net interest margin for the second quarter was 3.48%, a decrease of 39 bps from the prior quarter primarily due to increased financing costs. During the quarter, we received approxim
Slide 25: Portfolio Net Interest Income
Portfolio Net Interest Income Quarter over Quarter Comparison Portfolio Net Interest Income (2Q’22 vs 1Q’22) Portfolio net interest income increased in the second quarter as compared to the previous quarter, primarily due to our continued investment in higher- yielding business purpose loans. The in
Slide 26: Non-Interest (Loss) Income
Non-Interest (Loss) Income Quarter over Quarter Comparison Realized Gains (Losses), net (2Q’22 vs 1Q’22) Net realized gains on residential loans are primarily a result of loan prepayment activity during the quarter. Dollar Amounts in Thousands 2Q'22 1Q'22 4Q'21 3Q'21 2Q'21 Residential loans $ 2,386
Slide 27: Non-Interest (Loss) Income
Non-Interest (Loss) Income Quarter over Quarter Comparison Income from Equity Investments (2Q’22 vs 1Q’22) The increase in income from equity investments in the second quarter is primarily related to unrealized gain recognized on an investment in an entity that originates residential loans. Dollar A
Slide 28: Net Loss from Real Estate
Net Loss from Real Estate Quarter over Quarter Comparison Net Loss from Real Estate (2Q’22 vs 1Q’22) The increase in both income from and expenses related to real estate in the second quarter is primarily related to the full quarter impact of multi- family joint venture investments made in the previ
Slide 29: Expense Analysis
Expense Analysis Quarter over Quarter Comparison General and Administrative Expenses (2Q’22 vs 1Q’22) Decrease in general and administrative expenses is largely related to a decrease in commission expense. Dollar Amounts in Thousands 2Q'22 1Q'22 4Q'21 3Q'21 2Q'21 Salaries, benefits and directors' co
Slide 30: Other Comprehensive (Loss) Income
Other Comprehensive (Loss) Income Other Comprehensive (Loss) Income (2Q’22 vs 1Q’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 second quarter. Dollar Amounts in Th
Slide 31: 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 June 30, 2022. Quarter Ended June 30, 2022 Amounts in Thousands, except per share Amount Shares Per Share Beginning Balance, Book Value $ 1,
Slide 32: 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 33: Appendix
Appendix
Slide 34: Non-GAAP Financial Measures
Non-GAAP Financial Measures Undepreciated (Loss) Earnings / Undepreciated Book Value Per Common Share In addition to the results presented in accordance with GAAP, this supplemental presentation includes certain non-GAAP financial measures, including undepreciated earnings, undepreciated book value
Slide 35: Non-GAAP Financial Measures
Non-GAAP Financial Measures Portfolio Interest Income, Portfolio Interest Expense and Portfolio Net Interest Income Dollar Amounts in Thousands 2Q'22 1Q'22 4Q'21 3Q'21 2Q'21 GAAP interest income $ 68,020 $ 58,501 $ 52,318 $ 52,323 $ 52,186 GAAP interest expense 41,891 28,622 21,546 21,292 20,711 GAA
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 (after repair) represents the weighted average loan-to-value calculated • Image(s) used under license from Shutterstock.com. using the maximum loan amount and original after-repair value per the Slide 3 appraisal or broker price opinion obtained for the mortgage loan (only •
Slide 39: End Notes
End Notes • Joint Venture Equity Portfolio amount represents the Company's net equity • Average FICO and Average Coupon for RPL Strategy, BPL-Bridge investment in consolidated and unconsolidated multi-family apartment Strategy , BPL-Rental Strategy and Performing Loan Strategy properties as of June
Slide 40: End Notes
End Notes • Borrower Experience represents the weighted average historical number of • Target IRR for Joint Venture Equity investments represents the range of investments or rehabilitation projects attributed to BPL-Bridge strategy borrowers estimated internal rates of return for the investments. th
Slide 41: End Notes
End Notes Slide 25 • Refer to Appendix - “Reconciliation of Portfolio Net Interest Income" for reconciliation of Portfolio Net Interest Income for Single-Family. • Total Portfolio Interest Income, Total Portfolio Net Interest Income and Total Net Interest Income include amounts related to our “Other
Slide 42: Capital Allocation
Capital Allocation At June 30, 2022 (Dollar Amounts in Thousands) Single-Family (1) Multi-Family Other Total Residential loans $ 4,329,192 $ — $ — $ 4,329,192 Consolidated SLST CDOs (710,233) — — (710,233) Multi-family loans — 106,825 — 106,825 Investment securities available for sale 74,822 30,096
Slide 43: Reconciliation of Single-Family Portfolio Net Interest Income
Reconciliation of Single-Family Portfolio Net Interest Income Dollar Amounts in Thousands 2Q'22 1Q'22 4Q'21 3Q'21 2Q'21 Single-Family Interest income, residential loans $ 51,522 $ 41,467 $ 33,587 $ 31,488 $ 30,088 Interest income, investment securities available for sale 1,692 1,954 3,348 4,527 4,03
Slide 44: Reconciliation of Joint Venture Equity Investments
Reconciliation of Joint Venture Equity Investments Dollar Amounts in Thousands At June 30, 2022 Cash and cash equivalents $ 38,233 Real estate, net 1,649,472 (a) Lease intangible, net 18,924 Other assets 29,163 Total assets $ 1,735,792 Mortgages payable on real estate, net $ 1,251,059 Other liabilit
Slide 45: Thank You
Thank You From all of us at NYMT
New York Mortgage Trust — Q2 2022 Earnings Presentation on 6ix