Adamas Trust, Inc. · NASDAQ:ADAM
Adamas Trust — New York Mortgage Trust — Q3 2024 Earnings Presentation
52 slides from Adamas Trust's earnings presentation, Oct 31, 2024
Slide 1: 2024 Third Quarter Financial Summary
New York Mortgage Trust, Inc. 2024 Third 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
To Our Stockholders Management Update "The Company reported sharply higher earnings per share of $0.36 in the third quarter. The improved earnings were the result of a portfolio rotation which began over a year ago. As part of the plan, we focused on acquisitions that can deliver high recurring inte
Slide 4: Table of Contents
Table of Contents • Company Overview • Financial Summary • Market & Strategy Update • Quarterly Financial Information • Appendix 4
Slide 5: Company Overview
Company Overview /NYMT Yi \ WAS | LN AS \ : \ / ff A ( / i J 7 Wi yj y Vj
Slide 6: NYMT Overview
NYMT Overview Capital Allocation New York Mortgage Trust, Inc. (NASDAQ: NYMT) is an Single-Family Credit Single-Family Agency internally-managed real estate investment trust (“REIT”) for Multi-Family Cash and Other U.S. federal income tax purposes in the business of acquiring, 1% investing in, finan
Slide 7: Key Developments
Key Developments ◦ Earnings per share (basic) of $0.36, Comprehensive income per share of $0.36 ◦ Undepreciated earnings per share of $0.39* Financial ◦ Book value per share of $9.83 (1.44% change QoQ) Performance ◦ Adjusted book value per share of $10.87* (-1.36% change QoQ) ◦ 3.51% Quarterly Econo
Slide 8: Market Update
Market Update • Unlike in the past, the federal government is now running a large primary deficit despite very low unemployment. • High budget deficits are usually followed by high unemployment rates, placing the U.S. economy in a precarious position. • While the deficit is not a leading concern rig
Slide 9: Balance Sheet Structured for Growth
Balance Sheet Structured for Growth Earnings Improvement NYMT Investment Portfolio Size +16.9% $7.5 $6.9 • Sequential increase of portfolio income achieved by +9.3% +5.9% rotating Company exposure from low-income, total +8.5% $5.9 return strategies to recurring interest income assets. +17.5% $5.1 $5
Slide 10: Adjusted Book Value Composition
Adjusted Book Value Composition $ Adjusted Adjusted Book Book Value* Value per Share* $1,178 $13 Net Discount to Par ** $1,087 $12 $1.55/share $996 $11 Adjusted Book Value Credit & Other Capital $1.64/share $906 $10 $10.87/share Less Corporate Financing JV Equity $0.21/share $815 $9 BPL-Bridge Capit
Slide 11: Financial Summary
Financial Summary \ WAS | & i — \ . \ /SNYMT V J, :
Slide 12: Financial Snapshot
Financial Snapshot Dividend Per Share Adjusted Book Value Per Share* Undepreciated Earnings Per Share* $11.02 $10.87 Earnings & $0.20 $0.20 $0.39 Book Value $(0.25) 3.60 3.34 % 2Q 2024 3Q 2024 2.80 % 2Q 2024 3Q 2024 2.45 % 2.18% % 12.64% Dividend Yield Q3'24 Economic Return on 2Q 2024 3Q 2024 Adjust
Slide 13: NYMT Debt Structure
NYMT Debt Structure Portfolio and Corporate Debt Quarterly Portfolio Quarterly PortfolioFinancing Exposure Financing Exposure (Dollar amounts in millions) Corporate Sr. Unsec. Notes Corporate Sub. Debentures $160 | 3% $45 | <1% Portfolio Recourse Leverage Ratio 1.2x 1.5x 1.6x 2.0x 2.5x Repo - Credit
Slide 14: NYMT Portfolio Assets
NYMT Portfolio Assets Agency RMBS $2,968 MM | 42% BPL-Bridge Single-Family $1,157 MM | 16% Agency Mezzanine Lending 42% $203 MM | 3% BPL-Rental $601 MM | 9% Cross-Collateralized Mezzanine Lending Performing Loans $138 MM | 2% $549 MM | 8% Single-Family $6.9 Billion Investment Portfolio Joint Venture
Slide 15: Market & Strategy Update
Market & Vf Strategy Updat ayy Yi /NYMT
Slide 16: NYMT Investment Strategy
NYMT Investment Strategy Strategy For Sustainable Earnings Growth Residential Investment Acquisitions (Dollar amounts in millions) $1,134 Strategy $1,008 • NYMT continues to grow the investment $933 portfolio with the goal of generating higher recurring net interest income. $372 $654 • Recent acquis
Slide 17: NYMT Securitization Activity
NYMT Securitization Activity Securitization • Lower base rates and tighter credit spreads have fostered a robust securitization market in 2024. • NYMT has been an active issuer of securitizations to more efficiently finance our increased residential loan acquisitions in a variety of sectors through
Slide 18: Single-Family Agency RMBS Market
Single-Family Agency RMBS Market Market Specified Pools at Different Coupons $1,500 200 • In the quarter, current coupon mortgage NYMT Agency RMBS ($MM) spreads tightened by 19bps to 129bps, driven by lower interest rate volatility due to the Fed's 150 ZV Spread (bp) first rate cut since March 2020.
Slide 19: Single-Family Agency RMBS Strategy
Single-Family Agency RMBS Strategy Strategy Agency RMBS Portfolio Characteristics Asset Value ($MM) Specified Pool % | Agency IO % • As a core strategy, Agency RMBS provides several benefits for NYMT: $2,968 97% | 3% ◦ High carry and compelling risk-adjusted returns ◦ Diversification of portfolio Sp
Slide 20: Single-Family Business Purpose Loan-Bridge Strategy
Single-Family Business Purpose Loan-Bridge Strategy Strategy Loan 3Q 2024 3Q 2024 Portfolio Characteristics Acquisitions • NYMT has been active in the BPL-Bridge strategy since 2019, and has purchased loans from 17 originator or UPB ($MM) $1,180 $316 aggregator companies. Loan Count 2,205 634 • The
Slide 21: Single-Family Portfolio Overview
Single-Family Portfolio Overview Total Investment Total Dollar amounts in millions Portfolio 89% Capital 77% Asset Value Capital Portfolio Portfolio Characteristics Recourse Leverage Strategy Sub-Sector Leverage Current Environment Ratio Avg. Avg. % $ % $ Ratio Avg. LTV Coupon FICO − BPL-Bridge secu
Slide 22: Multi-Family Mezzanine Lending and Cross-Collateralized Mezzanine Lending
Multi-Family Asset Class-Mezzanine Lending and Cross-Collateralized Mezzanine Lending Cross-Collateralized Senior Debt Characteristics Mezzanine Lending Mezzanine Lending Fixed Rate 24% 99% Hedged Floating Rate 55% 1% Unhedged Floating Rate 21% — Total 100% 100% Senior Debt Avg. Effective Coupon 5.9
Slide 23: Multi-Family Portfolio Overview
Multi-Family Portfolio Overview Total Investment Total Dollar amounts in millions Portfolio 5% Capital 22% Asset Value Capital (1) Characteristics Strategy Sub-Sector Avg. Current Environment Avg. % $ % $ Avg. DSCR Adjusted Coupon (3) (2) LTV − As the primary lender in the multi- family market, Agen
Slide 24: 2024 Focus
2024 Focus Throughout the year, the Company has focused on portfolio rotation to increase earnings while also maintaining a high level of liquidity. We believe this effort will create certain advantages to grow portfolio earnings in 2025. Utilize a Strong and Flexible Balance Sheet to Capture Long-T
Slide 25: Quarterly Financial Information
Quarterly Financial Information 25
Slide 26: Financial Results: Third Quarter Profit & Loss
Financial Results Third Quarter Profit & Loss Dollar amounts in millions, except per share data Description Amount EPS Contribution Interest income $ 108.4 $ 1.20 Interest expense (88.1) (0.97) Net Interest Income $ 20.2 $ 0.22 Income from real estate 31.9 0.35 Expenses related to real estate (39.4)
Slide 27: Yields By Strategy
Yields By Strategy Quarter over Quarter Comparison Net Interest Spread* (3Q’24 vs 2Q’24) Yield on average interest earning assets increased by 23bps, primarily due to an increase in the average coupon rate of business purpose loans acquired during the quarter. This increase was offset by an increase
Slide 28: Adjusted Net Interest Income
Adjusted Net Interest Income* Quarter over Quarter Comparison Adjusted Net Interest Income* (3Q’24 vs 2Q’24) Increase in Adjusted Net Interest Income primarily attributable to increased investment in Agency RMBS and business purpose loans in the third quarter. Adjusted Interest Income & Adjusted Int
Slide 29: Net Loss from Real Estate
Net Loss from Real Estate Quarter over Quarter Comparison Net Loss from Real Estate (3Q’24 vs 2Q’24) Decrease in net loss from real estate during the quarter primarily due to sales of underlying properties or membership interests in, and de- consolidation of, six multi-family joint venture equity in
Slide 30: Other Income (Loss)
Other Income (Loss) Quarter over Quarter Comparison Realized Losses, Net (3Q’24 vs 2Q’24) Net realized losses on residential loans and real estate owned in the third quarter is primarily related to losses incurred on foreclosed properties due to lower valuations, partially offset by net realized gai
Slide 31: Other Income (Loss)
Other Income (Loss) Quarter over Quarter Comparison (Losses) Gains on Derivative Instruments, Net (3Q’24 vs 2Q’24) Net losses on derivative investments in the third quarter primarily related to: • Unrealized losses on interest rate swaps as a result of a decrease in interest rates • Realized losses
Slide 32: Other Income (Loss)
Other Income (Loss) Quarter over Quarter Comparison Impairment of Real Estate (3Q’24 vs 2Q’24) Impairment losses recognized as a result of a decrease in the fair value of real estate due to lower valuations. Dollar Amounts in Thousands 3Q'24 2Q'24 1Q'24 4Q'23 3Q'23 Impairment of Real Estate $ (7,823
Slide 33: Expense Analysis
Expense Analysis Quarter over Quarter Comparison General and Administrative Expenses Dollar Amounts in Thousands 3Q'24 2Q'24 1Q'24 4Q'23 3Q'23 Salaries, benefits and directors' compensation $ 8,736 $ 8,331 $ 9,273 $ 8,773 $ 8,649 Other general and administrative expenses 3,205 3,317 3,781 2,968 3,17
Slide 34: Other Comprehensive Income (Loss)
Other Comprehensive Income (Loss) Dollar Amounts in Thousands 3Q'24 2Q'24 1Q'24 4Q'23 3Q'23 Net Income (Loss) Attributable to Company's Common Stockholders $ 32,410 $ (26,028) $ (68,340) $ 31,465 $ (94,819) Other Comprehensive Income (Loss): Increase (decrease) in fair value of investment securities
Slide 35: Book Value
Book Value Changes in Book Value The following table analyzes the changes in GAAP Book Value and Adjusted Book Value* of our common stock for the quarter ended September 30, 2024. Quarter Ended September 30, 2024 Amounts in Thousands, except per share Amount Shares Per Share Beginning Balance, GAAP
Slide 36: Annual and Quarterly Returns
Annual and Quarterly Returns Economic/Total Rate Economic Return: Change in book value per share for the period + dividend per share declared for the period, divided by the beginning period book value per share. Economic Return on Adjusted Book Value:* Change in Adjusted Book Value per share for the
Slide 37: Appendix
Appendix 37
Slide 38: Non-GAAP Financial Measures
Non-GAAP Financial Measures Adjusted Net Interest Income and Net Interest Spread In addition to the results presented in accordance with GAAP, this supplemental presentation includes certain non-GAAP financial measures, including adjusted interest income, adjusted interest expense, adjusted net inte
Slide 39: Reconciliation of Single-Family Adjusted Net Interest Income
Non-GAAP Financial Measures Reconciliation of Single-Family Adjusted Net Interest Income Dollar Amounts in Thousands 3Q'24 2Q'24 1Q'24 4Q'23 3Q'23 Single-Family GAAP interest income $ 104,608 $ 88,067 $ 81,227 $ 76,119 $ 61,346 GAAP interest expense (81,214) (67,434) (61,740) (57,489) (44,101) GAAP
Slide 40: Reconciliation of Corporate/Other Adjusted Net Interest Loss
Non-GAAP Financial Measures Reconciliation of Corporate/Other Adjusted Net Interest Loss Dollar Amounts in Thousands 3Q'24 2Q'24 1Q'24 4Q'23 3Q'23 Corporate/Other GAAP interest income $ 1,054 $ — $ — $ — $ — GAAP interest expense (6,910) (4,297) (4,289) (4,500) (4,305) GAAP total net interest loss $
Slide 41: Reconciliation of Total Adjusted Net Interest Income
Non-GAAP Financial Measures Reconciliation of Total Adjusted Net Interest Income Dollar Amounts in Thousands 3Q'24 2Q'24 1Q'24 4Q'23 3Q'23 GAAP interest income $ 108,361 $ 90,775 $ 83,892 $ 78,789 $ 65,195 GAAP interest expense (88,124) (71,731) (66,029) (61,989) (48,406) GAAP total net interest inc
Slide 42: Undepreciated Earnings (Loss)
Non-GAAP Financial Measures Undepreciated Earnings (Loss) Undepreciated Earnings (Loss) is a supplemental non-GAAP financial measure defined as GAAP net income (loss) attributable to Company's common stockholders excluding the Company's share in depreciation expense and lease intangible amortization
Slide 43: Adjusted Book Value Per Common Share
Non-GAAP Financial Measures Adjusted Book Value Per Common Share Adjusted book value per common share is a supplemental non-GAAP financial measure calculated by making the following adjustments to GAAP book value: (i) exclude the Company's share of cumulative depreciation and lease intangible amorti
Slide 44: Reconciliation of Adjusted Book Value Per Common Share
Non-GAAP Financial Measures Reconciliation of Adjusted Book Value Per Common Share Dollar Amounts in Thousands (except per share data) 3Q'24 2Q'24 1Q'24 4Q'23 3Q'23 Company's stockholders' equity $ 1,444,147 $ 1,431,910 $ 1,485,256 $ 1,579,612 $ 1,575,228 Preferred stock liquidation preference (554,
Slide 45: Glossary
Glossary The following defines certain of the commonly used terms in this presentation: "Adjusted Book Value" has the meaning set forth in Appendix - "Non-GAAP Financial Measures—Adjusted Book Value Per Common Share"; "Adjusted Interest Income" has the meaning set forth in Appendix - "Non-GAAP Finan
Slide 46: Glossary
Glossary "Economic Return" is calculated based on the periodic change in GAAP book value per share plus dividends declared per common share during the respective period; "Economic Return on Adjusted Book Value" is calculated based on the periodic change in Adjusted Book Value per common share, a sup
Slide 47: End Notes
End Notes Slide 1 − Additional financing of under-levered assets represents the estimated − Image(s) used under license from PowerPoint Stock Images. additional financing available for residential loans, investment securities Slide 3 and CDOs repurchased from residential loan securitizations under t
Slide 48: End Notes
End Notes Slide 13 Slide 16 − Amounts for Corporate Senior Unsecured Notes and Subordinated − Residential Investment Acquisitions represent the cost of Residential Debentures represent the outstanding note balance. Credit and Agency RMBS assets acquired by the Company during the − Repo - Agency incl
Slide 49: End Notes
End Notes − Average FICO and Average Coupon represent the weighted average − Average FICO and Average Coupon for RPL, BPL-Bridge, BPL-Rental and borrower FICO score and weighted average gross coupon rate. Performing Loan represent the weighted average borrower FICO score − Average LTARV represents t
Slide 50: End Notes
End Notes − Asset Value for Mezzanine Lending represents the fair value of the − Asset Value for Joint Venture Equity investments represents the investments as of September 30, 2024. Company's net equity investment in consolidated and unconsolidated − Asset Value for Cross-Collateralized Mezzanine L
Slide 51: Capital Allocation
Capital Allocation At September 30, 2024 (Dollar Amounts in Thousands) Single-Family (1) Multi-Family Corporate/ Total Other Residential loans $ 3,777,144 $ — $ — $ 3,777,144 Consolidated SLST CDOs (845,811) — — (845,811) Investment securities available for sale 3,036,182 — 349,088 3,385,270 Multi-f
Slide 52: Reconciliation of Joint Venture Equity and Consolidated Mezzanine Lending Investments
Reconciliation of Joint Venture Equity and Consolidated Mezzanine Lending Investments Cross- Consolidated Collateralized Mezzanine Joint Venture Mezzanine Lending Dollar Amounts in Thousands Equity Lending Investment Total Cash and cash equivalents $ 508 $ 5,063 $ 623 $ 6,194 (1) Real estate, net 76
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