Pennymac Mortgage Investment Trust · NYSE:PMT
Pennymac Mortgage Investment Trust — Q4 2010 Earnings Presentation
16 slides from Pennymac Mortgage Investment Trust's earnings presentation, Feb 4, 2011
Slide 1: Fourth Quarter 2010 Earnings Report
PennyMac Mortgage Investment Trust Fourth Quarter 2010 Earnings Report February 2, 2011
Slide 2: Forward-Looking Statements
Forward-Looking Statements This presentation contains forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended, regarding management’s beliefs, estimates, projections and assumptions with respect to, among other things, the Company’s financial r
Slide 3: Fourth Quarter Highlights
Fourth Quarter Highlights 2 Earned consolidated quarterly net income of $7.3 million, or $0.43 per share Net Investment Income: $13.6 million Cash flow generated from investments: $49 million Significant increase in professional services expenses resulting from a variety of strategic initiatives On
Slide 4: Full-Year 2010 Highlights
Full-Year 2010 Highlights 3 Fully deployed equity capital and continue to reinvest Purchased $828 million in UPB of mortgage loans in eleven transactions Increased investable capital by $300 million by putting in place several credit facilities Earned consolidated net income of $24.5 million, or $1.
Slide 5: Outlook For 2011
Outlook For 2011 4 Distressed Whole Loans Opportunities to acquire distressed whole loans expected to continue throughout the year Banks continue improving their ratios through strategic sales of whole loans Re-performing whole loans may become more attractive investments PMT’s capital and operating
Slide 6: PMT's Investment Activity & Strategy
PMT’s Investment Activity & Strategy
Slide 7: Investment Activity Overview
Investment Activity Overview 6 Mortgage Whole Loans Completed transaction of $146 million of non-performing whole loans in the fourth quarter Reduced volume of mortgage loans reviewed in the fourth quarter, as expected Increased volume expected in the first quarter Operationalized two credit facilit
Slide 8: Investment Activity During the Quarter
Investment Activity During the Quarter 7 Q3 Holdings Q4 Activity From Investments Q4 Purchases Q4 Holdings Whole Loans Nonperforming Loans $182mm in fair value Performing Loans $58mm in fair value Total Holdings $240mm in fair value Cash Flows Scheduled Payments - $0.2mm Payoffs - $2.8mm Liquidation
Slide 9: Fourth Quarter Gross Returns Are In line With Expectations
Fourth Quarter Gross Returns Are In line With Expectations 8 Returns have the potential to increase as debt financing is fully utilized Notes: Positions are inclusive of accrued interest Cashflows for Whole Loans + REO are net of servicing fees Transactions for bond repos include only securities new
Slide 10: Example: Illustrative Returns Based on PMT's Assumptions
Example: Illustrative Returns Based on PMT’s Assumptions* 9 ($ in millions) Targeted Unlevered Return1 Targeted Leverage 12% - 17% Illustrative Return2 3% - 5% 25bps – 30bps on origination volume 0.5x - 1.0x 4.0x - 6.0x 6.0x - 9.0x 20% - 26% 14% - 20% 21% - 29% Target Cost of Funds LIBOR + 200bps to
Slide 11: Financials
Financials (&nnymac’
Slide 12: Income Statement
Income Statement 11 PENNYMAC MORTGAGE INVESTMENT TRUST AND SUBSIDIARIES CONSOLIDATED STATEMENT S OF OPERATIONS (In thousands, except share data) (unaudited) Quarter ended December 31, 2010 Year ended December 31, 2010 Investment Income Gains (losses) on investments: Mortgage loans ..................
Slide 13: Increased Operational Expenses Impacted Fourth Quarter Profitability
Increased Operational Expenses Impacted Fourth Quarter Profitability 12 The largest expense associated with professional services was the due diligence costs incurred on the large acquisition completed during the quarter Operational expenses increased as a result of due diligence costs associated wi
Slide 14: Cash Flows for the Fourth Quarter
Cash Flows for the Fourth Quarter 13 For the three months ended December 31, 2010 Mortgage-backed securities Principal Payments $19,857 Interest Received $456 Mortgage loans held for investment: Scheduled payments 217 Liquidations 10,934 Payoff 2,799 Sales 2,377 Interest (net of servicing fee of $1,
Slide 15: Balance Sheet
Balance Sheet 14 PENNYMAC MORTGAGE INVESTMENT TRUST AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS (In thousands, except share data) (unaudited) December 31, 2010 2009 ASSETS Cash ................................ ................................ ................................ .......................
Slide 16: PennyMac Mortgage Investment Trust Fourth Quarter 2010 Earnings Report
PennyMac Mortgage Investment Trust Fourth Quarter 2010 Earnings Report February 2, 2011
PennyMac Mortgage Investment Trust — Q4 2010 Earnings Presentation on 6ix