Ares Commercial Real Estate Corporation · NYSE:ACRE
Ares Commercial Real Estate — FY2019 Earnings Presentation
17 slides from Ares Commercial Real Estate's earnings presentation, Feb 20, 2020
Slide 1: Fourth Quarter and Full-Year 2019 Earnings Presentation
Exhibit 99.2 Fourth Quarter and Full-Year 2019 Earnings Presentation
Slide 2: Important Notice
Important Notice Statements included herein may constitute “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995 and Section 21E of the Securities Exchange Act of 1934, as amended, which may relate to future events or the future performance or financ
Slide 3: Fourth Quarter and Full-Year 2019 Highlights
Fourth Quarter and Full-Year 2019 Highlights • GAAP Earnings of $9.7 million or $0.33 per diluted common share and $37.0 million or $1.28 per diluted common share for the 2019 Financial fourth quarter and full-year, respectively • Core Earnings(1) of $10.7 million or $0.37 per diluted common share a
Slide 4: Q4-2019 Investment Activity
Q4-2019 Investment Activity Q4-2019 Characteristics of Funded Loans(6) Loans Summary ($ in millions) Number of loans closed 6 Multifamily New loan commitments $250.3 17% Average size of loans closed $41.7 Industrial Percentage of floating rate loans 100% 36% Percentage of senior loans 100% Total fun
Slide 5: Full-Year 2019 Investment Activity
Full-Year 2019 Investment Activity Full-Year 2019 Characteristics of Funded Loans(6) Loans Summary ($ in millions) Multifamily Student Housing Number of loans closed 18 18% 9% New loan commitments $776.9 Self Storage Average size of loans closed $43.2 3% Percentage of floating rate loans 100% Percen
Slide 6: Total Loans Held for Investment Portfolio Key Statistics
Total Loans Held for Investment Portfolio Key Statistics Loan Portfolio Characteristics(5) ($ in millions) Total loan commitments $1,909.1 Mid-Atlantic/Northeast Outstanding principal balance $1,692.9 5% Weighted average unpaid principal balance of loan portfolio* $1,601.0 Southwest 16% Total number
Slide 7: Interest Rate Sensitivity
Interest Rate Sensitivity(5) • 98% of the loan portfolio is floating rate and 2% is fixed rate • 95% of the loan portfolio is either floating rate with a LIBOR floor (93%) or fixed rate (2%) ◦ For the floating rate loans with LIBOR floors, the weighted average LIBOR floor is 1.76% • 61% of the loan
Slide 8: Financing Sources Overview
Financing Sources Overview Financing Sources Composition(5) Financing Sources Detail Bank Facilities/Insurance ($ in millions) Term Loan55% Total (3) Outstanding Financing Sources Commitments Interest Rate Balance Bank Facilities 2017-FL3 Securitization Wells Fargo Facility $ 500.0 LIBOR+1.50 to 2.2
Slide 9: Dividend Summary
Dividend Summary Quarterly Dividend Since Q1-16 $0.35 $0.33 $0.33 $0.33 $0.33 $0.33 $0.33 $0.31 $0.31 $0.29 $0.29 $0.28 $0.28 $0.27 $0.27 $0.27 $0.27 $0.27 $0.26 $0.26 $0.26 $0.26 $0.25 Q1-16 Q2-16 Q3-16 Q4-16 Q1-17 Q2-17 Q3-17 Q4-17 Q1-18 Q2-18 Q3-18 Q4-18 Q1-19 Q2-19 Q3-19 Q4-19 Q1-20* *Declared a
Slide 10: Appendix
Appendix O ARES
Slide 11: Loans Held for Investment Portfolio Details
Loans Held for Investment Portfolio Details ($ in millions) Origination Current Loan Outstanding LIBOR Unleveraged Payment # Loan Type Location Date Commitment Principal Carrying Value Interest Rate Floor Effective Yield(2) Maturity Date Terms (9) Multifamily Loans: 1 Senior FL Sep 2016 $89.7 $89.7
Slide 12: Loans Held for Investment Portfolio Details
Loans Held for Investment Portfolio Details ($ in millions) Origination Current Loan Outstanding LIBOR Unleveraged Payment # Loan Type Location Date Commitment Principal Carrying Value Interest Rate Floor Effective Yield(2) Maturity Date Terms (9) Hotel Loans: 27 Senior OR/WA May 2018 $68.1 $68.1 $6
Slide 13: Loans Held for Investment Portfolio Details
Loans Held for Investment Portfolio Details ($ in millions) Origination Current Loan Outstanding LIBOR Unleveraged Payment # Loan Type Location Date Commitment Principal Carrying Value Interest Rate Floor Effective Yield(2) Maturity Date Terms (9) Industrial Loans: 43 Senior FL Oct 2019 $52.5 $52.5
Slide 14: Consolidated Balance Sheets
Consolidated Balance Sheets As of ($ in thousands, except share and per share data) 12/31/2019 12/31/2018 ASSETS Cash and cash equivalents $ 5,256 $ 11,089 Restricted cash 379 379 Loans held for investment ($515,896 and $289,576 related to consolidated VIEs, respectively) 1,682,498 1,524,873 Real es
Slide 15: Consolidated Statements of Operations
Consolidated Statements of Operations For the Three Months Ended ($ in thousands, except share and per share data) 12/31/2019 9/30/2019 6/30/2019 3/31/2019 12/31/2018 Revenue: Interest income from loans held for investment $ 28,536 $ 28,269 $ 29,993 $ 27,986 $ 30,882 Interest expense (15,044) (15,12
Slide 16: Reconciliation of Net Income to Non-GAAP Core Earnings
Reconciliation of Net Income to Non-GAAP Core Earnings(1) For the Three Months Ended ($ in thousands, except per share data) 12/31/2019 9/30/2019 6/30/2019 3/31/2019 12/31/2018 Net income attributable to common stockholders $ 9,660 $ 9,034 $ 9,755 $ 8,543 $ 10,018 Stock-based compensation 482 479 42
Slide 17: Footnotes
Footnotes 1. The Company believes the disclosure of Core Earnings provides useful information to investors regarding the calculation of incentive fees the Company pays to its manager, Ares Commercial Real Estate Management LLC, and the Company’s financial performance. Core Earnings is an adjusted no
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