Ready Capital Corporation · NYSE:RC
Ready Capital — Q4 2024 Earnings Presentation
25 slides from Ready Capital's earnings presentation, Mar 3, 2025
Slide 1: Supplemental Financial Data Q4 2024
SUPPLEMENTAL FINANCIAL DATA Q4 2024
Slide 2: Disclaimer
2 Disclaimer This presentation contains statements that constitute “forward-looking statements,” as such term is defined in 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 covered by the
Slide 3: Fourth Quarter 2024 Results
3 Fourth Quarter 2024 Results ■ Net loss from continuing operations1 of $(1.80) per common share ■ Distributable losses2 of $(0.03) per common share ■ Distributable earnings before realized losses3 of $0.23 per common share ■ Declared dividend of $0.25 per common share Performance ■ Total loan portf
Slide 4: 2024 Results
4 2024 Results ■ Net loss from continuing operations7 of $(2.52) per common share ■ Distributable earnings8 of $0.07 per common share ■ Distributable earnings before realized losses9 of $0.97 per common share ■ $186 million dividends of $1.10 per common share Performance ■ 81% multifamily and mixed
Slide 5: CRE Portfolio Review
5 CRE Portfolio Review YTD INVESTMENT ROLL ($ in billions) COUNT10 UPB ALLOWANCE CARRY VALUE 60+ DQ STATUS5 WA RISK RATING WAC CASH YIELD CORE 1,447 6.07B 80M 5.99B 2.0% 2.15 8.0% 7.6% NON-CORE 73 1.04B 218M 0.82B 36.2% 3.40 9.1% 3.1% PORTLAND MIXED-USE 2 0.56B 130M 0.43B —% 4.00 13.4% —% TOTAL 1,52
Slide 6: CRE Core Portfolio Overview
6 CRE Core Portfolio Overview LOAN PRODUCT11 RISK RATINGCOLLATERAL MODIFICATION STATUS HISTORICAL LEVERED YIELD 13.5% 11.4% 12.8% 12.0% 10.8% Q4 2023 Q1 2024 Q2 2024 Q3 2024 Q4 2024 0% 5% 10% 15% QUARTERLY PORTFOLIO CREDIT MIGRATION Bridge 75% Fixed rate 14% Construction 4% Freddie Mac 1% Other 6% M
Slide 7: CRE Non-Core Portfolio Overview
7 CRE Non-Core Portfolio Overview ASSET MANAGEMENT STRATEGY EXPECTED LIQUIDATION TIMELINE Bridge 55% Construction 42% Fixed rate 3% LOAN PRODUCT RISK RATINGCOLLATERAL Multi-family 52%Mixed use 38% Other 10% 2 14% 3 27% 4 43% 5 16% STRATEGY LOAN COUNT CARRY VALUE (%) Liquidation pending commencement
Slide 8: Real Estate Owned Exposure
8 Real Estate Owned Exposure # OF ASSETS CARRY VALUE OPERATE 4 $35M SELL 18 $69M LAND 8 $91M Land 42% Multi-family 32% Mixed use 13% Lodging 8% Office 4% Retail 1% Collateral Texas 32% California 15%Colorado 14% Oregon 13% Other 26% Geography 169,191 100 68,279 (12,675) (29,875) 195,020 Beginning Ba
Slide 9: Portland OR, Mixed-Use
9 Portland OR, Mixed-Use • 2019: Mosaic Real Estate Credit (Mosaic) originated a $460MM senior mortgage for the construction of The Ritz-Carlton, Portland • March 2022: RC acquires loan through its merger with Mosaic which became distressed due to the pandemic impact on the Portland economy and Spon
Slide 10: Small Business Lending Portfolio Review
10 Small Business Lending Portfolio Review QTD SALES BY PROGRAM PROGRAM COUNT23 UPB ALLOWANCE CARRY VALUE 60+ DQ STATUS5 WA RISK RATING WAC CASH YIELD LARGE 1,773 $1.1B $13M $1.1B 2.7% 1.65 9.8% 9.1% SMALL/MICRO 4,679 $204M $9M $194M 2.4% 1.34 11.2% 10.5% USDA 4 $2M — $2M —% 1.86 10.6% 10.6% WORKING
Slide 11: Quarterly Investment Activity
$8.8 $98.1 $157.3 $70.6 $23.5 $5.3 $18.5 $211.9$288.0 $156.2 $99.1 $157.1 $200.4 $152.2 $197.2 $217.3 $354.8 $314.5$38.5 $2.8 $46.4 $31.2 Bridge Fixed Rate/CMBS Construction Freddie Mac SBA USDA Working Capital Q4'23 Q1'24 Q2'24 Q3'24 Q4'24 0 200 400 600 800 1,000 11 Quarterly Investment Activity $4
Slide 12: Earnings Profile
12 Earnings Profile Balance (in thousands) Annualized ROE Contribution Recurring Revenue: Net interest income $ 50,054 9.9% Gain on sale, net of variable costs 20,940 4.1% Other recurring revenue 20,586 4.1% Total Recurring Revenue $ 91,580 18.0% Operating Expenses: Employee compensation & benefits
Slide 13: Operating Segment Contribution
13 Operating Segment Contribution24 LMM CRE TOTAL OPERATING EXPENSES EQUITY ALLOCATION25 EPS CONTRIBUTION RECURRING REVENUE DISTRIBUTABLE RETURN BEFORE REALIZED LOSSES13 ON STANDALONE EQUITY DISTRIBUTABLE RETURN BEFORE REALIZED LOSSES13 CORPORATE & OTHER SMALL BUSINESS LENDINGCORE NON-CORE & REO $7.
Slide 14: Book Value per Share
14 Book Value per Share $12.59 $0.18 $(0.43) $(1.56) $(0.17) $10.61 Q3'24 GAAP BVPS Share repurchases Dividends in excess of earnings excl. allowances and realized and unrealized losses Allowance Realized & unrealized losses Q4'24 GAAP BVPS $7.50 $10.00 $12.50 $15.00 $0.58 $13.17 $12.36 $1.75 REPRES
Slide 15: Capitalization
15 Capitalization Debt Balance ($ in millions) Leverage Ratio PPPLF $21 0.0x Securitized Debt Obligations $3,581 1.9x Non-Recourse Secured Borrowings $1,028 0.6x Recourse Secured Borrowings $1,007 0.6x Corporate Debt $1,333 0.7x UNENCUMBERED ASSET POOL 11% 37% 21% 10% 4% 17% Unrestricted cash Securi
Slide 16: Appendix: Additional Financial Information
APPENDIX Additional Financial Information
Slide 17: Segment ROE and Levered Yield
GAAP ROE Distributable ROE Segment Levered Yield Distributable Levered Yield Equity Allocation Q4'24 Q3'24 FY 2024 Q4'24 Q3'24 FY 2024 LMM Commercial Real Estate 10.8 % 10.0 % 88.9 % 15.8 % 15.5 % 13.6 % 15.1 % 15.8 % 13.5 %Small Business Lending 62.2 % 62.2 % 9.7 % Corporate leverage, net of non-ea
Slide 18: LMM CRE Loan Portfolio - Migration
18 LMM CRE Loan Portfolio - Migration CONTRACTUAL STATUS (5) TOTAL Q1’24 Q2’24 Q3’24 Q4’24 CURRENT 87.8% 92.8% 91.4% 92.7% 30+ DAYS PAST DUE 2.3% 0.9% 1.4% 1.4% 60+ DAYS PAST DUE 9.9% 6.3% 7.2% 5.9% RC ORIGINATED Q1’24 Q2’24 Q3’24 Q4’24 CURRENT 89.9% 94.4% 92.6% 93.3% 30+ DAYS PAST DUE 2.2% 0.4% 1.2
Slide 19: Financial Snapshot
19 Financial Snapshot ($ in thousands, except share data) Investment Type Average Carrying Value Gross Yield Average Debt Balance Debt Cost Levered Yield LMM CRE $ 8,151,304 8.8 % $ 5,503,233 8.0 % 10.8 % SBL $ 658,742 31.3 % $ 377,947 8.2 % 62.2 % Total $ 8,810,046 10.5 % $ 5,881,180 8.0 % 15.8 % B
Slide 20: Balance Sheet by Quarter
20 Balance Sheet by Quarter (in thousands) 12/31/2023 3/31/2024 6/30/2024 9/30/2024 12/31/2024 Assets Cash and cash equivalents $ 138,532 $ 166,004 $ 226,286 $ 181,315 $ 143,803 Restricted cash 30,063 24,915 29,971 31,331 30,560 Loans, net 4,020,160 3,400,481 3,444,879 3,555,928 3,378,149 Loans, hel
Slide 21: Statement of Operations by Quarter
21 Statement of Operations by Quarter (In thousands, except share data) Q4 2023 Q1 2024 Q2 2024 Q3 2024 Q4 2024 Interest income $ 250,130 $ 232,354 $ 234,119 $ 226,537 $ 203,965 Interest expense (197,591) (183,805) (183,167) (175,572) (153,911) Net interest income before (provision for) recovery of
Slide 22: Distributable Earnings Reconciliation by Quarter
22 Distributable Earnings Reconciliation by Quarter The Company believes that this non-U.S. GAAP financial information, in addition to the related U.S. GAAP measures, provides investors greater transparency into the information used by management in its financial and operational decision- making, in
Slide 23: Loan Portfolio – Risk Rating Criteria
23 Loan Portfolio – Risk Rating Criteria BUCKET 1: Very Low Risk of Loss: New origination or current with strong credit metrics (LTV/DSCR/DY). No expected losses. BUCKET 2: Low Risk of Loss: Current with maturity > 6 months. Lower credit metrics with possibility of inclusion on CREFC watchlist. No e
Slide 24: Footnotes
24 Footnotes 1 . Before income attributable to participating shares of $2.2 million and non-controlling interest of $3.1 million 2 . Before income attributable to participating shares of $2.2 million and non-controlling interest of $3.1 million. Refer to the “Distributable Earnings Reconciliation by
Slide 25: ” READY
” READY 85. CAPITAL.