Lument Finance Trust, Inc. · NYSE:LFT
Lument Finance Trust — Q1 2023 Earnings Presentation
30 slides from Lument Finance Trust's earnings presentation, May 2023
Slide 1: Lument Finance Trust Investor Presentation May 2023
Lument Finance Trust Investor Presentation May 2023
Slide 2: Disclaimer
Disclaimer This presentation contains forward-looking statements 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, which reflect the current views of Lument Finance Trust, Inc. (NYSE: LFT) (“LFT,” the “Com
Slide 3: Company Overview
Company Overview • The Company is an externally-managed real estate investment trust focused on investing in, financing and managing a portfolio of commercial real estate debt investments • The Company is externally managed by Lument Investment Management, an affiliate of ORIX Corporation USA Key In
Slide 4: Leveraging the Depth of the Lument Platform
Leveraging the Depth of the Lument Platform The Company leverages Lument’s broad platform and significant expertise when originating and underwriting investments • Lument is a nationally recognized leader in multifamily and seniors housing and care finance • Combining the industry expertise of legac
Slide 5: Lument: A Platform Built for the Benefit of Investors
Lument: A Platform Built for the Benefit of Investors • ~600 employees across 30+ offices provide clients of Lument and its affiliates with a mix of Diverse Opportunity markets, assets, and deal types that span the breadth of commercial and multifamily real Set via Lument estate Origination Platform
Slide 6: Affiliation with ORIX
Affiliation with ORIX ORIX Corporation USA, a subsidiary of ORIX Corporation, is the parent of the Company’s investment manager and is also a meaningful Company shareholder ORIX CORPORATION USA – AT A GLANCE ORIX Corporation USA provides investment capital and asset management services to clients in
Slide 7: Lument: Experienced Leadership Team
Lument: Experienced Leadership Team JAMES FLYNN JAMES BRIGGS Director & CEO, Lument Finance Trust CFO, Lument Finance Trust Chief Executive Officer, Lument Chief Accounting Officer, Lument VIC CLARK BARRY FULLER JAMES HENSON Head of Conventional Head of Loan Servicing and General Counsel, Lument Mul
Slide 8: Lument Finance Trust: Target Investments
Lument Finance Trust: Target Investments Loan Size $5 million to $50+ million Collateral Primarily first lien real estate debt on stabilized or transitional assets Property Type Multifamily, retail, office, industrial, and self storage Geographies Within the United States Loan to Value Typically up
Slide 9: Investment Portfolio
Investment Portfolio • On March 31, 2023, the Company owned a portfolio of floating-rate CRE loans with a carrying value of $1.0 billion. 89.7%(1) of the portfolio was invested in loans backed by multifamily assets. • The Company anticipates that the majority of loan activity will continue to be rel
Slide 10: Q1 2023 Capital Structure Overview
Q1 2023 Capital Structure Overview • The Company does not currently utilize repurchase or warehouse facility financing and therefore is not subject to margin calls on any of its assets from repo or warehouse lenders. • Primary sources of financing include a match-term non-MTM CRE CLO (LMNT 2021-FL1)
Slide 11: Earnings and Book Value Per Share of Common Stock
Earnings and Book Value Per Share of Common Stock GAAP Earnings & Distributable Earnings (1) Book Value Per Share of Common Stock (2) Per Share of Common Stock $0.09 $3.60 $3.55 $3.50 $3.46 $0.06 CECL $0.05 implemented on January 1, $0.04 2023. BVPS is net of CECL $0.03 reserve of $0.06 as of 3/31/2
Slide 12: Conclusion
Conclusion Key Investment Highlights Strong Sponsorship/Ownership Attractive Investment Profile • Access to extensive loan origination platform • Emphasis on middle market multifamily through affiliation with Lument, a premier investments which are well positioned for the national mortgage originato
Slide 13: Appendix Q1 2023 Financial Updates
Appendix Q1 2023 Financial Updates
Slide 14: Q1 2023 Updates
Q1 2023 Updates • Q1 2023 GAAP net income attributable to common stockholders of $4.6 million, or $0.09 per share of common stock. Q1 2023 Distributable Earnings (1) of $0.2 million, or $0.00 per share of common stock. Financial Results • Distributable Earnings was negatively impacted by a $4.3 mill
Slide 15: Q1 2023 Income Statement Summary
Q1 2023 Income Statement Summary Three Months GAAP Net Income to Distributable Three Months Summary Income Statement Ended March Earnings Reconciliation Ended March (thousands) 31, 2023 (thousands) 31, 2023 Net interest income $8,246 Net Income attributable to common stockholders $4,582 Total other
Slide 16: Q1 2023 Balance Sheet Summary
Q1 2023 Balance Sheet Summary Balance Sheet March 31, (thousands) 2023(1) Commercial mortgage loans held-for- $1,016,464 investment (net of allowance for credit losses) Cash and cash equivalents 98,573 Restricted cash(2) 1,946 Accrued interest receivable 5,939 Investment related receivable 489 Other
Slide 17: Q1 2023 Loan Activity
Q1 2023 Loan Activity • The Company experienced $52.1 million of loan payoffs during the quarter. • Represents annual payoff rate of 20.5% (1) of the portfolio as of 3/31/2023. • There were no new loan acquisitions during Q1 2023. Payoffs by Property Type(2) Office, $6.0, 11.5% $52.1 Multi-Family, $
Slide 18: Portfolio Credit
Portfolio Credit • 98.8% of the Company’s portfolio is performing, which reflects our strong credit and asset management capabilities. • Increase in weighted average risk rating driven by rising interest rates and broader economic uncertainties. Asset Performance(1) Weighted Average Risk Rating 100%
Slide 19: Net Interest Income Sensitivity to Shifts in One-Month LIBOR and Term SOFR
Net Interest Income Sensitivity to Shifts in One-Month LIBOR and Term SOFR • 100% floating-rate loan portfolio. • 76.3% of portfolio is indexed to one-month LIBOR and 23.7% of portfolio is indexed to 30-day term SOFR(1). Annual Net Interest Income Sensitivity to Floating-Rate Exposure Shifts in One-
Slide 20: 3/31/2023 CRE Loan Portfolio Details
3/31/2023 CRE Loan Portfolio Details Closing Maturity Unpaid Principal Note Initial Term As-Is LTV at # Loan Name Property Type City State (1) Date Date Balance Spread (months) Origination 1 Loan 1 12/16/2021 1/3/2025 Multi-Family Daytona FL 51,375,000 3.05% 37 71.70% 2 Loan 2 11/22/2019 1/5/2024 Mu
Slide 21: 3/31/2023 CRE Loan Portfolio Details
3/31/2023 CRE Loan Portfolio Details Closing Maturity Unpaid Principal Note Initial Term As-Is LTV at # Loan Name Property Type City State (1) Date Date Balance Spread (months) Origination 22 Loan 22 10/12/2021 11/5/2023 Multi-Family Atlanta GA 17,500,000 3.15% 25 42.90% 23 Loan 23 7/8/2021 8/5/2023
Slide 22: 3/31/2023 CRE Loan Portfolio Details
3/31/2023 CRE Loan Portfolio Details Closing Maturity Unpaid Principal Note Initial Term As-Is LTV at # Loan Name Property Type City State (1) Date Date Balance Spread (months) Origination 45 Loan 45 12/2/2021 12/6/2024 Multi-Family Tomball TX 9,975,000 3.40% 36 68.50% 46 Loan 46 11/23/2021 12/5/202
Slide 23: Consolidated Balance Sheets
Consolidated Balance Sheets 23
Slide 24: Consolidated Statement of Income
Consolidated Statement of Income 24
Slide 25: Detailed Walk of Allowance for Loan Losses
Detailed Walk of Allowance for Loan Losses 25
Slide 26: Reconciliation of GAAP to Distributable Earnings
Reconciliation of GAAP to Distributable Earnings For the Three Months Ended December 31, September 30, GAAP to Distributable Earnings Reconciliation March 31, 2023 2022 2022 June 30, 2022 Reconciliation of GAAP to non-GAAP Information Net income attributable to common stockholders $4,581,733 $879,77
Slide 27: Detailed Walk of Capitalization as of 3/31/2023
Detailed Walk of Capitalization as of 3/31/2023 (in 000's) 3/31/2023 Total GAAP liabilities and stockholders' equity $1,126,324 Adjustments for Capitalization ( - ) Accrued interest payable (2,505) ( - ) Dividends payable (4,135) ( - ) Fees and expenses payable to Manager (1,604) ( - ) Other account
Slide 28: Book Value Per Share of Common Stock as of 3/31/2023
Book Value Per Share of Common Stock as of 3/31/2023 Book Value per Share of (in 000's) Common Stock(1) Total stockholders’ equity $240,847 ( - ) Preferred equity (60,000) (2) ( - ) Non-controlling interest (100) Common equity 180,748 Shares outstanding 52,231,152 Book Value Per Share of Common Stoc
Slide 29: Key Definitions
Key Definitions “Book Value Per Share of Common Stock” is calculated as: a) total stockholders’ equity computed in accordance with GAAP less the value of the issued and outstanding preferred stock at its stated liquidation preference of $25.00 per share, divided by b) the weight ed average number of
Slide 30: May 2023
=|] LUMENT May 2023