ANNALY CAPITAL MANAGEMENT, INC. AND SUBSIDIARIES
|
|
CONSOLIDATED STATEMENTS OF CASH FLOWS
|
|
(dollars in thousands)
|
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
Six Months Ended June 30,
|
|
|
|
2016
|
|
|
2015
|
|
Cash flows from operating activities:
|
|
|
|
|
|
|
Net income (loss)
|
|
$
|
(1,146,577
|
)
|
|
$
|
423,572
|
|
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities:
|
|
|
|
|
|
|
|
|
Amortization of Residential Investment Securities premiums and discounts, net
|
|
|
621,146
|
|
|
|
378,814
|
|
Amortization of commercial real estate investment premiums and discounts, net
|
|
|
(1,552
|
)
|
|
|
(581
|
)
|
Amortization of intangibles
|
|
|
7,621
|
|
|
|
3,586
|
|
Amortization of deferred financing costs
|
|
|
1,019
|
|
|
|
4,561
|
|
Amortization of net origination fees and costs, net
|
|
|
(2,868
|
)
|
|
|
(2,350
|
)
|
Amortization of contingent beneficial conversion feature and equity component of Convertible Senior Notes
|
|
|
-
|
|
|
|
12,246
|
|
Depreciation expense
|
|
|
10,684
|
|
|
|
5,687
|
|
Net gain on sale of commercial real estate
|
|
|
(821
|
)
|
|
|
-
|
|
Net gain on sale of commercial loans held for sale
|
|
|
67
|
|
|
|
100
|
|
Net loss on sale of commerical real estate debt investments
|
|
|
165
|
|
|
|
-
|
|
Net (gains) losses on sales of Residential Investment Securities
|
|
|
(10,271
|
)
|
|
|
(66,289
|
)
|
Stock compensation expense
|
|
|
1,084
|
|
|
|
1,024
|
|
Impairment of goodwill
|
|
|
-
|
|
|
|
22,966
|
|
Unrealized (gains) losses on interest rate swaps
|
|
|
1,404,940
|
|
|
|
(234,590
|
)
|
Net unrealized (gains) losses on financial instruments measured at fair value through earnings
|
|
|
54,026
|
|
|
|
15,965
|
|
Equity in net income from unconsolidated joint ventures
|
|
|
4,417
|
|
|
|
-
|
|
Net (gains) losses on trading assets
|
|
|
(207,069
|
)
|
|
|
121,136
|
|
Proceeds from sale of loans held for sale
|
|
|
114,358
|
|
|
|
-
|
|
Proceeds from repurchase agreements of RCap
|
|
|
1,076,600,000
|
|
|
|
895,400,000
|
|
Payments on repurchase agreements of RCap
|
|
|
(1,075,750,000
|
)
|
|
|
(900,650,000
|
)
|
Proceeds from reverse repurchase agreements
|
|
|
29,700,000
|
|
|
|
26,925,000
|
|
Payments on reverse repurchase agreements
|
|
|
(29,700,000
|
)
|
|
|
(26,825,000
|
)
|
Net payments on derivatives
|
|
|
196,016
|
|
|
|
(116,122
|
)
|
Net change in:
|
|
|
|
|
|
|
|
|
Due to / from brokers
|
|
|
(5
|
)
|
|
|
-
|
|
Other assets
|
|
|
(65,653
|
)
|
|
|
(15,686
|
)
|
Accrued interest and dividends receivable
|
|
|
3,202
|
|
|
|
45,897
|
|
Receivable for investment advisory income
|
|
|
-
|
|
|
|
(187
|
)
|
Accrued interest payable
|
|
|
7,592
|
|
|
|
(48,857
|
)
|
Accounts payable and other liabilities
|
|
|
24,331
|
|
|
|
13,952
|
|
Net cash provided by (used in) operating activities
|
|
|
1,865,852
|
|
|
|
(4,585,156
|
)
|
|
|
|
|
|
|
|
|
|
Cash flows from investing activities:
|
|
|
|
|
|
|
|
|
Payments on purchases of Residential Investment Securities
|
|
|
(7,088,346
|
)
|
|
|
(8,638,138
|
)
|
Proceeds from sales of Residential Investment Securities
|
|
|
4,008,291
|
|
|
|
18,278,224
|
|
Principal payments on Agency mortgage-backed securities
|
|
|
4,615,505
|
|
|
|
5,342,053
|
|
Payments on purchases of corporate debt
|
|
|
(245,447
|
)
|
|
|
(187,035
|
)
|
Principal payments on corporate debt
|
|
|
65,804
|
|
|
|
42,352
|
|
Purchases of commercial real estate debt investments
|
|
|
(76,862
|
)
|
|
|
(276,918
|
)
|
Sales of commercial real estate debt investments
|
|
|
-
|
|
|
|
41,016
|
|
Purchase of securitized loans at fair value
|
|
|
(1,489,268
|
)
|
|
|
(2,574,353
|
)
|
Origination of commercial real estate investments, net
|
|
|
(189,020
|
)
|
|
|
(180,531
|
)
|
Proceeds from sale of commercial real estate investments
|
|
|
12,750
|
|
|
|
46,806
|
|
Principal payments on commercial real estate debt investments
|
|
|
61,601
|
|
|
|
1,616
|
|
Principal payments on securitized loans at fair value
|
|
|
52,407
|
|
|
|
-
|
|
Principal payments on commercial real estate investments
|
|
|
402,459
|
|
|
|
321,050
|
|
Purchase of investments in real estate
|
|
|
(1,187
|
)
|
|
|
(121
|
)
|
Investment in unconsolidated joint venture
|
|
|
(559
|
)
|
|
|
(12,410
|
)
|
Distributions in excess of cumulative earnings from unconsolidated joint ventures
|
|
|
2,117
|
|
|
|
-
|
|
Purchase of equity securities
|
|
|
(88,062
|
)
|
|
|
(8,130
|
)
|
Proceeds from sales of equity securities
|
|
|
16,112
|
|
|
|
-
|
|
Net cash provided by (used in) investing activities
|
|
|
58,295
|
|
|
|
12,195,481
|
|
|
|
|
|
|
|
|
|
|
Cash flows from financing activities:
|
|
|
|
|
|
|
|
|
Proceeds from repurchase agreements
|
|
|
85,723,588
|
|
|
|
105,819,378
|
|
Principal payments on repurchase agreements
|
|
|
(88,936,063
|
)
|
|
|
(114,471,752
|
)
|
Payments on maturity of convertible senior notes
|
|
|
-
|
|
|
|
(857,541
|
)
|
Proceeds from other secured financing
|
|
|
2,146,084
|
|
|
|
203,200
|
|
Payments on other secured financing
|
|
|
(402,806
|
)
|
|
|
-
|
|
Proceeds from issuance of securitized debt
|
|
|
1,381,640
|
|
|
|
2,382,810
|
|
Principal repayments on securitized debt
|
|
|
(163,472
|
)
|
|
|
(37,915
|
)
|
Principal repayments on securitized loans
|
|
|
-
|
|
|
|
50
|
|
Payment of deferred financing cost
|
|
|
(3,076
|
)
|
|
|
(641
|
)
|
Net proceeds from direct purchases and dividend reinvestments
|
|
|
1,176
|
|
|
|
1,144
|
|
Principal payments on participation sold
|
|
|
(153
|
)
|
|
|
(147
|
)
|
Principal payments on mortgages payable
|
|
|
(7,399
|
)
|
|
|
(165
|
)
|
Distributions to noncontrolling interests
|
|
|
(743
|
)
|
|
|
(245
|
)
|
Net payment on share repurchase
|
|
|
(102,712
|
)
|
|
|
-
|
|
Dividends paid
|
|
|
(594,219
|
)
|
|
|
(604,587
|
)
|
Net cash provided by (used in) financing activities
|
|
|
(958,155
|
)
|
|
|
(7,566,411
|
)
|
|
|
|
|
|
|
|
|
|
Net (decrease) increase in cash and cash equivalents
|
|
|
965,992
|
|
|
|
43,914
|
|
|
|
|
|
|
|
|
|
|
Cash and cash equivalents, beginning of period
|
|
|
1,769,258
|
|
|
|
1,741,244
|
|
|
|
|
|
|
|
|
|
|
Cash and cash equivalents, end of period
|
|
$
|
2,735,250
|
|
|
$
|
1,785,158
|
|
|
|
|
-
|
|
|
|
-
|
|
Supplemental disclosure of cash flow information:
|
|
|
|
|
|
|
|
|
Interest received
|
|
$
|
1,456,076
|
|
|
$
|
1,541,718
|
|
Dividends received
|
|
$
|
-
|
|
|
$
|
8,366
|
|
Investment advisory income received
|
|
$
|
-
|
|
|
$
|
20,881
|
|
Interest paid (excluding interest paid on interest rate swaps)
|
|
$
|
282,146
|
|
|
$
|
218,272
|
|
Net interest paid on interest rate swaps
|
|
$
|
281,120
|
|
|
$
|
305,327
|
|
Taxes paid
|
|
$
|
591
|
|
|
$
|
1,901
|
|
|
|
|
|
|
|
|
|
|
Noncash investing activities:
|
|
|
|
|
|
|
|
|
Receivable for investments sold
|
|
$
|
697,943
|
|
|
$
|
247,361
|
|
Payable for investments purchased
|
|
$
|
746,090
|
|
|
$
|
673,933
|
|
Net change in unrealized gains (losses) on available-for-sale securities, net of reclassification adjustment
|
|
$
|
1,494,642
|
|
|
$
|
(559,848
|
)
|
|
|
$
|
-
|
|
|
$
|
-
|
|
Noncash financing activities
:
|
|
|
|
|
|
|
|
|
Dividends declared, not yet paid
|
|
$
|
277,479
|
|
|
$
|
284,331
|
|