Sachem Capital Corp. · AMEX:SACH
Sachem Capital — Investor Presentation (September 2019)
19 slides from Sachem Capital's investor presentation, Sep 6, 2019
Slide 1: Investor Presentation September 2019
Investor Presentation September 2019
Slide 2: Forward Looking Statement
Forward Looking Statement This presentation includes forward - looking statements . All statements in this presentation, other than statements of historical facts, including statements regarding our future results of operations and financial position, strategy and plans, and our expectations for fut
Slide 3: Management Team
Management Team 2 ▪ Co - founder and Chairman, Co - Chief Executive Officer, Chief Financial Officer and Secretary ▪ Co - founder of Sachem Capital Partners (“SCP”), and co - founder and Managing Partner of JJV, LLC, manager of SCP since its inception in December 2010 ▪ Mr. Villano, a certified publ
Slide 4: Sachem Capital Corp. Overview
0 20,000 40,000 60,000 80,000 100,000 2016 2017 2018 H1 2019 Sachem Capital Corp. Overview 3 ▪ Sachem Capital Corp. is a mortgage REIT specializing in originating, underwriting, funding, servicing and managing a portfolio of short - term, high yielding real estate loans conservatively secured by fir
Slide 5: Investment Highlights
Investment Highlights 4 x Internally managed, with co - founders owning approximately 15.3% of the company, aligning management’s interests with investors x High yielding assets and low cost structure generates attractive risk adjusted return on equity x Conservative leverage profile x Experienced m
Slide 6: Aging U.S. Housing Stock
Source: RealtyTrac , U.S. Census Aging U.S. Housing Stock ▪ The fix - and - flip market will remain robust as the aging U.S. housing stock requires renovation and updating ▪ Aging inventory stokes demand for remodeled homes » Recently, the median age of housing stock has increased each year by appro
Slide 7: Fix-and-Flip Activity Growing
Fix - and - Flip Activity Growing V ALUE OF U.S. H OMES F LIPPED AND R ELATED F INANCING A RE G ROWING P ERCENTAGE OF U.S. F IX - AND - F LIP H OMES F INANCED ($ in billions) 6 $30 $36 $34 $37 $44 $41 $46 $52 $57 $61 $0 $10 $20 $30 $40 $50 $60 $70 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 21
Slide 8: Robust Business Model
Robust Business Model 7 ▪ Grow first mortgage loan portfolio while protecting and preserving capital ▪ Disciplined underwriting and extensive due diligence culture focusing primarily on value of underlying collateral ▪ Intimate knowledge of Connecticut real estate market and ability to respond quick
Slide 9: Key Strategic Initiatives
Key Strategic Initiatives 8 Capitalize on opportunities arising from structural changes in the real estate lending market and continued limited liquidity Remain flexible to capitalize on changing investment opportunities at various points of the economic cycle Capitalize on competitor policies that
Slide 10: Typical Loan Structure
Typical Loan Structure 9 Sachem generates high yielding, short term business - purpose real estate loans that are not provided by traditional lenders Principal Amount ▪ Average loan amount: $202,000; Median loan amount: $137,000 ▪ Range of $7,000 to $2.3 million ▪ Maximum loan amount cannot exceed 1
Slide 11: Loan Portfolio Overview
Loan Portfolio Overview 10 ▪ Of the total number of loans, 76% are $250,000 or less, and 95% are $500,000 or less ▪ 67% of loans are for single residential projects, primarily homes that are fixed and flipped 0 10 20 30 40 50 60 70 80 90 2016 2017 2018 Q2 2019 Residential Mortgages Commercial Mortga
Slide 12: 2019 Corporate/Debt Restructuring
2019 Corporate/Debt Restructuring 11 2019 Financing Activities Use of Proceeds Raised net proceeds of $21.7 million through a public bond offering of 7.125% unsecured, unsubordinated notes in June 2019 Raised net proceeds of approximately $15.5 million in the first half of 2019 through the at - the
Slide 13: Restructuring Impact
Restructuring Impact Short - term: ▪ $30.6 million paid towards principal on the credit facility during Q2 2019 ▪ Credit constraints temporarily slowed the growth of the mortgage loan portfolio ▪ Earnings per share were adversely impacted in the second quarter of 2019 due to the increased share coun
Slide 14: Income Statement Overview
(1) 6/30/2019 annualized for return on assets and return on equity Income Statement Overview 13 Sachem’s business model generates strong returns and a significant cash flow coverage of interest First Half of 2019 (1) 2018 2017 Principal amount of loans earning interest $83,458 $78,891 $63,271 Loans
Slide 15: Balance Sheet Overview
14 Balance Sheet Overview As of June 30, 2019, the equity - to debt ratio was approximately 3:1, which does not take into account the recent $10 million equity offering ($ in Thousands) June 30, 2019 December 31, 2018 Assets Mortgage Receivables $83,458 $78,891 Other Assets 12,472 7,123 Total Assets
Slide 16: Portfolio Performance
Portfolio Performance 15 (1) Accordingly, for the first half of the 2017 period, net origination fee income is net of the amounts payable to JJV and other ad justments. From and after February 9, 2017, JJV is no longer entitled to any payments from Sachem (other than dividends paid to it in its capa
Slide 17: Dividends Paid
Dividends Paid 16 Quarter Dividend Q2 2017 $0.105 Q3 2017 $0.105 Q4 2017 $0.105 Q1 2018 $0.105 Q2 2018 $0.11 Q3 2018 $0.12 Q4 2018 $0.17 Q1 2019 $0.12 Q2 2019 $0.12 Plan to distribute 90+% of taxable income to shareholders annually Dividends paid relating to income earned in the first half of 2019 -
Slide 18: Investment Highlights
Investment Highlights 17 x Internally managed, with co - founders owning approximately 15.3% of the company, aligning management’s interests with investors x High yielding assets and low cost structure generates attractive risk adjusted return on equity x Conservative leverage profile x Experienced
Slide 19: Main Street Branford, CT
698 Main Street Branford, CT 06405 https://www.sachemcapitalcorp.com/
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