Apollo Commercial Real Estate Finance, Inc · NYSE:ARI
Apollo Commercial Real Estate Finance — Q4 2019 Earnings Presentation
20 slides from Apollo Commercial Real Estate Finance's earnings presentation, Feb 13, 2020
Slide 1: Supplemental Financial Information Q4 2019
Supplemental Financial Information Q4 2019 February 13, 2020 Exhibit 99.2
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: Q4 Highlights
Q4 Highlights See footnotes on page 19 Financial Results Net income available to common stockholders of $68.5 million, or $0.42 per diluted share of common stock Operating Earnings1 of $70.9 million, or $0.46 per diluted share of common stock Net interest income of $81.4 million Book value per share
Slide 4: Balance Sheet and Income Statement Summary
Balance Sheet ($ in mm, except for per share data) 12/31/19 12/31/18 Change Investments at Amortized Cost, net $6,375 $4,928 29.4% Invested Net Equity at Cost5 3,280 3,031 8.2% Common Stockholders' Equity 2,461 2,168 13.5% Preferred Stockholders' Equity (liquidation preference) 169 342 (50.6%) Conve
Slide 5: Q4 Investment Activity
Q4 Investment Activity See footnotes on page 19 Q4 19 Investment Summary Outstanding Portfolio (QTD) Loans Closed 9 Commitments to New Loans (100% Mortgages) $2,242 Weighted Average Unlevered All-in Yield2,a 5.6% Weighted Average Loan-to-Value (“LTV”)11 65% Add-on Fundings12 $143 ($ in mm) 14 $260 m
Slide 6: 2019 Investment Activity
2019 2018 Loans Closed 26 27 Commitments to New Loans $4,207 $2,972 Weighted Average Unlevered All-in Yield2,a - First Mortgage 5.6% 7.8% Weighted Average Unlevered All-in Yield2,a - Subordinate 10.6% 10.9% Weighted Average Loan-to-Value (“LTV”)11 63% 58% Add-on Fundings16 $416 $281 2019 Investment
Slide 7: Summary of New Investments
Summary of New Investments Q4 Investment and Repayment Activity See footnotes on page 19 £675.5 million ($877.7 million)17 of a senior mortgage, which is part of a £725.5 million ($942.7 million)17 floating-rate senior mortgage (none of which was funded at closing) for the development of a residenti
Slide 8: Commercial Real Estate Loan Portfolio Overview
($ in mm) 12/31/2019 9/30/2019 12/31/2018 Number of Loans 72 Loans 74 Loans 69 Loans Amortized Cost $6,375 $6,115 $4,928 Invested Net Equity at Cost5 $3,280 $3,555 $3,031 Unfunded Loan Commitments13 $1,953 $1,073 $1,096 Weighted Average Unlevered All-in Yield on Loan Portfolio2,a 7.4% 8.2% 9.3% Weig
Slide 9: Commercial Real Estate Loan Portfolio Diversification
Commercial Real Estate Loan Portfolio Diversification See footnotes on page 19 Geographic Diversification by Amortized Cost ($ in mm) 19 Property Type by Amortized Cost a a a) Other US includes the following geographies: Southwest, Northeast, and Mid-Atlantic b b) Other includes the following proper
Slide 10: Senior Loan Portfolio Overview
See footnotes on page 19 Weighted Average All-in Yield2,a on Senior Loans – 6.0% Senior Loan Portfolio Overview ($ in mm) 22 21 22 13 20 a) Excludes benefit of forward points on currency hedges related to loans denominated in currencies other than USD $
Slide 11: Subordinate Loan Portfolio Overview
Subordinate Loan15 Portfolio Overview See footnotes on page 19 Weighted Average All-in Yield2,a on Subordinate Loans15 – 14.1% TOTAL PORTFOLIO WEIGHTED AVERAGE: All-in Yield2,a – 7.4% ($ in mm) 21 23 23 13 20 a) Excludes benefit of forward points on currency hedges related to loans denominated in cu
Slide 12: Loan Portfolio Maturity Profile
Loan Portfolio Maturity Profile See footnotes on page 19 Fully Extended Loan Maturities and Estimated Future Fundings24,25,26 ($ in mm)
Slide 13: Capital Structure Overview
Capital Structure Overview See footnotes on page 19 Debt to Equity Ratio8: 1.4x Fixed Charge Coverage9: 2.5x ~$7.1 Billion Total Capitalization Capital Structure Detail Capital Structure Composition ($ in mm) 29 $2,808 $3,096 $498 $575 $169 a) After September 2020, rate changes to the greater of: 8.
Slide 14: Liquidity and Available Capital
Unallocated Credit Approved and Undrawn Credit Capacity Cash See footnotes on page 19 Liquidity ($ in mm) 30 31 32 Total Available Capital Total Potential Liquidity
Slide 15: Interest Rate Sensitivity
Interest Rate Sensitivity See footnotes on page 19 Rate Profile of Loan Portfolio24 Net Interest Income Sensitivity to USD LIBOR33 LIBOR floors partially offset impact from decline in USD LIBOR Increasing LIBOR increases earnings
Slide 16: Financials
Financials APOLLO | commercial Real Estate Finance
Slide 17: Consolidated Balance Sheets
(in thousands - except share data) December 31, 2019 December 31, 2018 Assets: Cash and cash equivalents $452,282 $109,806 Commercial mortgage loans, net (includes $4,852,087 and $3,197,900 pledged as collateral under secured debt arrangements in 2019 and 2018, respectively) 5,326,967 3,878,981 Subo
Slide 18: Consolidated Statements of Operations
(in thousands - except share data and per share data) Three months ended Year ended December 31, 2019 December 31, 2018 December 31, 2019 December 31, 2018 Net interest income: Interest income from commercial mortgage loans $85,595 $75,275 $322,475 $263,709 Interest income from subordinate loans and
Slide 19: Operating Earnings Reconciliation
(in thousands - except share and per share data) Three months ended Year ended Operating Earnings1: December 31, 2019 December 31, 2018 December 31, 2019 December 31, 2018 Net income available to common stockholders $68,517 $46,155 $211,649 $192,646 Adjustments: Equity-based compensation expense 3,8
Slide 20: Footnotes
Footnotes Operating 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 awards shoul
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