New York Mortgage Trust, Inc. (Nasdaq:NYMT) (“NYMT,” the “Company,”
“we,” “our” or “us”) today reported results for the three months
ended March 31, 2018.
Summary of First Quarter 2018:
- Net income attributable to common stockholders of $23.7
million, or $0.21 per share (basic), and comprehensive loss to
common stockholders of $0.8 million, or $0.01 per share.
- Net interest income of $19.8 million and portfolio net interest
margin of 286 basis points.
- Book value per common share of $5.79 at March 31, 2018, a
decrease of 3.5% from December 31, 2017, resulting in an economic
loss of 0.2% for the quarter.
- Declared first quarter dividend of $0.20 per common share that
was paid on April 26, 2018.
Management Overview
Steven Mumma, NYMT’s Chairman and Chief Executive Officer,
commented: “the Company continued to benefit from its focus on
multi-family credit, with multi-family assets, particularly the
Company’s K-Series investments, contributing nicely to both net
interest margin as well as portfolio valuation improvements, which
helped offset some of the pressure on our Agency RMBS portfolio
during the quarter. The Company’s net interest margin for the
first quarter expanded by 47 basis points from the prior quarter,
with credit assets the primary driver of that improvement.
All of this in the back drop of what is currently a very
challenging market environment for fixed-income strategies, where
liability costs are rising and overall interest rate volatility is
increasing the costs of hedging and placing downward pressure on
some of our strategies.
On the acquisition side, the quarter was relatively quiet. We
continued to grow our credit portfolio, adding approximately $33.9
million in multi-family investments and second mortgages. The
build in credit assets remains gradual, as the demand for credit
assets continues to be highly competitive. We intend to maintain
our disciplined approach to asset selection as we believe this is
the key to positive long-term performance and remain focused on
growing our credit portfolio in 2018."
Capital Allocation
The following tables set forth our allocated
capital by investment type at March 31, 2018, our interest
income and interest expense by investment type, and the weighted
average yield, average cost of funds and portfolio net interest
margin for our average interest earning assets (by investment type)
for the three months ended March 31, 2018 (dollar amounts in
thousands):
Capital Allocation at March 31, 2018: |
|
Agency RMBS(1) |
|
Multi-Family (2) |
|
Distressed Residential (3) |
|
Other (4) |
|
Total |
Carrying Value |
$ |
1,161,445 |
|
|
$ |
836,353 |
|
|
$ |
461,305 |
|
|
$ |
150,461 |
|
|
$ |
2,609,564 |
|
Liabilities |
|
|
|
|
|
|
|
|
|
Callable(5) |
(934,367 |
) |
|
(315,931 |
) |
|
(155,965 |
) |
|
(30,100 |
) |
|
(1,436,363 |
) |
Non-Callable |
— |
|
|
(29,390 |
) |
|
(40,825 |
) |
|
(112,154 |
) |
|
(182,369 |
) |
Convertible |
— |
|
|
— |
|
|
— |
|
|
(129,242 |
) |
|
(129,242 |
) |
Hedges (Net) (6) |
9,915 |
|
|
— |
|
|
— |
|
|
— |
|
|
9,915 |
|
Cash (7) |
12,284 |
|
|
15,739 |
|
|
436 |
|
|
37,743 |
|
|
66,202 |
|
Goodwill |
— |
|
|
— |
|
|
— |
|
|
25,222 |
|
|
25,222 |
|
Other |
2,128 |
|
|
(5,958 |
) |
|
17,610 |
|
|
(25,922 |
) |
|
(12,142 |
) |
Net Capital
Allocated |
$ |
251,405 |
|
|
$ |
500,813 |
|
|
$ |
282,561 |
|
|
$ |
(83,992 |
) |
|
$ |
950,787 |
|
% of Capital
Allocated |
26.4 |
% |
|
52.7 |
% |
|
29.7 |
% |
|
(8.8 |
)% |
|
100.0 |
% |
|
|
|
|
|
|
|
|
|
|
Net Interest Income- Three Months Ended March 31,
2018: |
Interest Income |
$ |
7,971 |
|
|
$ |
17,493 |
|
|
$ |
7,311 |
|
|
$ |
1,638 |
|
|
$ |
34,413 |
|
Interest Expense |
(4,407 |
) |
|
(3,890 |
) |
|
(2,291 |
) |
|
(4,073 |
) |
|
(14,661 |
) |
Net Interest Income
(Expense) |
$ |
3,564 |
|
|
$ |
13,603 |
|
|
$ |
5,020 |
|
|
$ |
(2,435 |
) |
|
$ |
19,752 |
|
|
|
|
|
|
|
|
|
|
|
Portfolio Net Interest Margin - Three Months Ended March
31, 2018 |
Average Interest
Earning Assets (8) |
$ |
1,208,900 |
|
|
$ |
612,357 |
|
|
$ |
467,898 |
|
|
$ |
136,135 |
|
|
$ |
2,425,290 |
|
Weighted Average Yield
on Interest Earning Assets (9) |
2.64 |
% |
|
11.43 |
% |
|
6.25 |
% |
|
4.81 |
% |
|
5.68 |
% |
Less: Average Cost of
Funds (10) |
(1.82 |
)% |
|
(4.51 |
)% |
|
(4.45 |
)% |
|
(3.25 |
)% |
|
(2.82 |
)% |
Portfolio Net Interest
Margin (11) |
0.82 |
% |
|
6.92 |
% |
|
1.80 |
% |
|
1.56 |
% |
|
2.86 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) |
Includes
Agency fixed-rate RMBS, Agency ARMs and Agency IOs. |
(2) |
The
Company, through its ownership of certain securities, has
determined it is the primary beneficiary of the Consolidated
K-Series and has consolidated the Consolidated K-Series into the
Company’s condensed consolidated financial statements. Average
Interest Earning Assets for the quarter excludes all Consolidated
K-Series assets other than those securities actually owned by the
Company. Interest income amounts represent interest income earned
by securities that are actually owned by the Company. A
reconciliation of net capital allocated to and net interest income
from multi-family investments is included below in “Additional
Information.” |
(3) |
Includes
$322.1 million of distressed residential mortgage loans, $36.4
million of distressed residential mortgage loans, at fair value and
$99.2 million of Non-Agency RMBS. |
(4) |
Other
includes residential mortgage loans held in securitization trusts
amounting to $70.9 million, residential second mortgage loans, at
fair value of $63.1 million, investments in unconsolidated entities
amounting to $12.9 million and mortgage loans held for investment
totaling $3.4 million. Mortgage loans held for sale and mortgage
loans held for investment are included in the Company’s
accompanying condensed consolidated balance sheets in receivables
and other assets. Other non-callable liabilities consist
of $45.0 million in subordinated debentures and $67.2
million in residential collateralized debt obligations. |
(5) |
Includes
repurchase agreements. |
(6) |
Includes
derivative assets and restricted cash posted as margin. |
(7) |
Includes
$0.4 million in deposits held in our distressed residential
securitization trusts to be used to pay down outstanding debt.
These deposits are included in the Company’s accompanying condensed
consolidated balance sheets in receivables and other assets. |
(8) |
Our Average
Interest Earning Assets is calculated each quarter based on daily
average amortized cost. |
(9) |
Our
Weighted Average Yield on Interest Earning Assets was calculated by
dividing our annualized interest income for the quarter by our
Average Interest Earning Assets for the quarter. |
(10) |
Our Average
Cost of Funds was calculated by dividing our annualized interest
expense for the quarter by our average interest bearing
liabilities, excluding our subordinated debentures and convertible
notes, which generated interest expense of approximately $0.6
million and $2.6 million, respectively, for the quarter. Our
Average Cost of Funds includes interest expense on our interest
rate swaps. |
(11) |
Portfolio
Net Interest Margin is the difference between our Weighted Average
Yield on Interest Earning Assets and our Average Cost of Funds,
excluding the weighted average cost of subordinated debentures and
convertible notes. |
Prepayment History
The following table sets forth the constant
prepayment rates (“CPR”) for selected asset classes, by quarter,
for the quarterly periods indicated.
Quarter Ended |
|
Agency Fixed-Rate RMBS |
|
Agency ARMs |
|
Agency IOs |
|
Residential Securitizations |
March 31, 2018 |
|
5.4 |
% |
|
10.2 |
% |
|
10.2 |
% |
|
10.8 |
% |
December 31, 2017 |
|
6.3 |
% |
|
12.9 |
% |
|
17.8 |
% |
|
22.1 |
% |
September 30, 2017 |
|
12.8 |
% |
|
9.4 |
% |
|
17.4 |
% |
|
18.2 |
% |
June 30, 2017 |
|
9.6 |
% |
|
16.5 |
% |
|
17.5 |
% |
|
16.8 |
% |
March 31, 2017 |
|
10.6 |
% |
|
8.3 |
% |
|
15.9 |
% |
|
5.1 |
% |
December 31, 2016 |
|
12.3 |
% |
|
21.7 |
% |
|
19.4 |
% |
|
11.1 |
% |
September 30, 2016 |
|
10.0 |
% |
|
20.7 |
% |
|
18.2 |
% |
|
15.9 |
% |
June 30, 2016 |
|
10.2 |
% |
|
17.6 |
% |
|
15.6 |
% |
|
17.8 |
% |
March 31, 2016 |
|
7.9 |
% |
|
13.5 |
% |
|
14.7 |
% |
|
14.8 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
First Quarter Earnings Summary
For the quarter ended March 31, 2018, we
reported net income attributable to common stockholders of $23.7
million as compared to $24.6 million in the quarter ended December
31, 2017.
We generated net interest income of $19.8
million and a portfolio net interest margin of 286 basis points for
the quarter ended March 31, 2018 as compared to net interest
income of $15.0 million and a portfolio net interest margin of 239
basis points for the quarter ended December 31, 2017.
The $4.8 million increase in net interest income in the first
quarter was primarily due to higher net interest income generated
by both our Agency RMBS portfolio and distressed residential
portfolio. Our Agency RMBS portfolio produced an additional
$0.8 million of net interest margin during the first quarter of
2018 primarily as a result of an increase in average interest
earning assets in that portfolio of $237 million. In
addition, our distressed residential portfolio experienced an
increase in asset yield of 257 basis points, which generated higher
net interest margin of $3.3 million in this portfolio over the
prior quarter. The improvement in net interest margin in the
Company's distressed residential portfolio is largely attributable
to changes in expected cash flows resulting from decreased loan
sale activity in the first quarter of 2018.
For the quarter ended March 31, 2018, we
recognized other income of $21.0 million as compared to other
income of $25.2 million in the quarter ended December 31,
2017. The decrease in other income of $4.2 million is
primarily driven by:
- A decrease in net unrealized gains on multi-family loans and
debt held in securitization trusts of $6.1 million.
- A decrease in realized gains on distressed residential mortgage
loans of $5.8 million as a result of limited loan sales activity
during the quarter.
- An increase in net realized loss on investment securities and
related hedges of $3.4 million resulting from the continued
divestment of our Agency IO portfolio, partially offset by an
unrealized loss recovery of $2.7 million previously recognized on
these assets and included in the net unrealized gain on investment
securities and related hedges, as discussed below.
- An increase in net unrealized gain on investment securities and
related hedges of $11.4 million primarily consisting of a $9.0
million unrealized gain from our interest rate swaps accounted for
as trading instruments for accounting purposes and the $2.7 million
gain from our Agency IO portfolio.
- An increase in other income of $2.5 million, which is primarily
due to a $2.3 million gain recognized by a consolidated variable
interest entity from the sale of its multi-family apartment
community (which is fully allocated to net income attributable to
non-controlling interest in consolidated variable interest entities
on the accompanying condensed consolidated statements of operations
- see the table below for further information).
The following table details the general and
administrative expenses for the quarters ended March 31, 2018
and December 31, 2017, respectively (dollar amounts in
thousands):
|
|
Three Months Ended |
General and Administrative Expenses |
|
March 31, 2018 |
|
December 31, 2017 |
Salaries, benefits and
directors’ compensation |
|
$ |
2,556 |
|
|
$ |
2,415 |
|
Base management and
incentive fees |
|
833 |
|
|
163 |
|
Other general and
administrative expenses |
|
2,100 |
|
|
1,747 |
|
Total
general and administrative expenses |
|
$ |
5,489 |
|
|
$ |
4,325 |
|
|
|
|
|
|
|
|
|
|
The following table details the operating
expenses related to our distressed residential mortgage loans and
the operating real estate and real estate held for sale in
consolidated variable interest entities for the quarters ended
March 31, 2018 and December 31, 2017, respectively (dollar
amounts in thousands):
|
|
Three Months Ended |
Operating Expenses |
|
March 31, 2018 |
|
December 31, 2017 |
Expenses related to
distressed residential mortgage loans |
|
$ |
1,603 |
|
|
$ |
2,064 |
|
Expenses related to
operating real estate and real estate held for sale in consolidated
variable interest entities |
|
1,606 |
|
|
1,899 |
|
Total
operating expenses |
|
$ |
3,209 |
|
|
$ |
3,963 |
|
|
|
|
|
|
|
|
|
|
The decrease in operating expenses in the first
quarter can be primarily attributed to a decrease in expenses
related to our distressed residential loan strategy due to lower
sales activity during the first quarter.
The results of operations applicable to the
operating real estate and real estate held for sale in consolidated
variable interest entities included in the Company's condensed
consolidated statements of operations for the three months ended
March 31, 2018 are as follows (dollar amounts in thousands):
|
|
Three Months Ended March 31, 2018 |
Gain on sale of real
estate in consolidated variable interest entities |
|
$ |
2,328 |
|
Income from operating
real estate and real estate held for sale in consolidated variable
interest entities |
|
2,126 |
|
Expenses related to
operating real estate and real estate held for sale in consolidated
variable interest entities |
|
(1,606 |
) |
Net
income from operating real estate and real estate held for sale in
consolidated variable interest entities |
|
2,848 |
|
Net income from
operating real estate and real estate held for sale in consolidated
variable interest entities attributable to non-controlling
interest |
|
(2,539 |
) |
Net
income from operating real estate and real estate held for sale in
consolidated variable interest entities attributable to Company's
common stockholders |
|
$ |
309 |
|
|
|
|
|
|
Analysis of Changes in Book Value
The following table analyzes the changes in book
value of our common stock for the quarter ended March 31, 2018
(amounts in thousands, except per share):
|
Quarter Ended March 31, 2018 |
|
Amount |
|
Shares |
|
Per Share(1) |
Beginning
Balance |
$ |
671,865 |
|
|
111,910 |
|
|
$ |
6.00 |
|
Common stock issuance,
net(2) |
389 |
|
|
207 |
|
|
|
Balance after share
issuance activity |
672,254 |
|
|
112,117 |
|
|
6.00 |
|
Dividends declared |
(22,423 |
) |
|
|
|
(0.20 |
) |
Net change in
accumulated other comprehensive income: |
|
|
|
|
|
Investment securities (3) |
(24,478 |
) |
|
|
|
(0.22 |
) |
Net
income attributable to Company's common stockholders |
23,693 |
|
|
|
|
0.21 |
|
Ending
Balance |
$ |
649,046 |
|
|
112,117 |
|
|
$ |
5.79 |
|
|
|
|
|
|
|
|
|
|
|
|
(1) |
Outstanding
shares used to calculate book value per share for the ending
balance is based on outstanding shares as of March 31, 2018 of
112,116,506. |
(2) |
Includes
amortization of stock based compensation. |
(3) |
The $24.5
million decrease related to investment securities is primarily due
to a decline in the value of the Agency RMBS portfolio, which
decreased by $24.7 million during the quarter, partially offset by
a $9.0 million unrealized gain from our interest rate swaps
recorded in our condensed consolidated statements of operations for
the three months ended March 31, 2018. |
Conference Call
On Friday, May 4, 2018 at 9:00 a.m., Eastern
Time, New York Mortgage Trust's executive management is scheduled
to host a conference call and audio webcast to discuss the
Company’s financial results for the three months ended
March 31, 2018. The conference call dial-in number is (877)
312-8806. The replay will be available until Friday, May 11, 2018
and can be accessed by dialing (855) 859-2056 and entering passcode
7564197. A live audio webcast of the conference call can be
accessed via the Internet, on a listen-only basis, at the Company's
website at http://www.nymtrust.com. Please allow extra time,
prior to the call, to visit the site and download the necessary
software to listen to the Internet broadcast.
First quarter 2018 financial and operating data
can be viewed in the Company’s Quarterly Report on Form 10-Q for
the quarter ended March 31, 2018, which is expected to be
filed with the Securities and Exchange Commission on or about May
10, 2018. A copy of the Form 10-Q will be posted at the Company’s
website as soon as reasonably practicable following its filing with
the Securities and Exchange Commission.
About New York Mortgage Trust
New York Mortgage Trust, Inc. is a Maryland
corporation that has elected to be taxed as a real estate
investment trust for federal income tax purposes (“REIT”). NYMT is
an internally managed REIT in the business of acquiring, investing
in, financing and managing mortgage-related and residential
housing-related assets and targets multi-family CMBS, direct
financing to owners of multi-family properties through preferred
equity and mezzanine loan investments, residential mortgage loans,
including second mortgages and loans sourced from distressed
markets, non-Agency RMBS, Agency RMBS and other mortgage-related
and residential housing-related investments. Headlands Asset
Management, LLC provides investment management services to the
Company with respect to its distressed residential loans. For
a list of defined terms used from time to time in this press
release, see “Defined Terms” below.
Defined Terms
The following defines certain of the commonly
used terms in this press release: “RMBS” refers to residential
mortgage-backed securities comprised of adjustable-rate, hybrid
adjustable-rate, fixed-rate, interest only and inverse interest
only, and principal only securities; “Agency RMBS” refers to RMBS
representing interests in or obligations backed by pools of
residential mortgage loans issued or guaranteed by a federally
chartered corporation ("GSE"), such as the Federal National
Mortgage Association (“Fannie Mae”) or the Federal Home Loan
Mortgage Corporation (“Freddie Mac”), or an agency of the U.S.
government, such as the Government National Mortgage Association
(“Ginnie Mae”); "Non-Agency RMBS" refers to RMBS backed by
performing, re-performing and non-performing mortgage loans;
“Agency ARMs” refers to Agency RMBS comprised of adjustable-rate
and hybrid adjustable-rate RMBS; "Agency fixed-rate RMBS" refers to
Agency RMBS comprised of fixed-rate RMBS; “IOs” refers collectively
to interest only and inverse interest only mortgage-backed
securities that represent the right to the interest component of
the cash flow from a pool of mortgage loans; “Agency IOs” refers to
an IO that represents the right to the interest component of cash
flow from a pool of residential mortgage loans issued or guaranteed
by a GSE, or an agency of the U.S. government; “POs” refers to
mortgage-backed securities that represent the right to the
principal component of the cash flow from a pool of mortgage loans;
“ARMs” refers to adjustable-rate residential mortgage loans;
“residential securitized loans” refers to prime credit quality ARMs
held in securitization trusts; “distressed residential mortgage
loans” or "distressed residential loans" refers to pools of
performing and re-performing fixed-rate and adjustable-rate, fully
amortizing, interest-only and balloon, seasoned mortgage loans
secured by first liens on one- to four-family properties; “CMBS”
refers to commercial mortgage-backed securities comprised of
commercial mortgage pass-through securities, as well as IO or PO
securities that represent the right to a specific component of the
cash flow from a pool of commercial mortgage loans; “multi-family
CMBS” refers to CMBS backed by commercial mortgage loans on
multi-family properties; “multi-family securitized loans” refers to
the commercial mortgage loans included in the Consolidated
K-Series; “CDO” refers to collateralized debt obligation; “CLO”
refers to collateralized loan obligation; and "Consolidated
K-Series” refers to Freddie Mac-sponsored multi-family loan
K-Series securitizations, of which we, or one of our special
purpose entities, own the first loss PO securities and certain IO
securities.
Additional Information
We determined that the Consolidated K-Series
were variable interest entities and that we are the primary
beneficiary of the Consolidated K-Series. As a result, we are
required to consolidate the Consolidated K-Series’ underlying
multi-family loans including their liabilities, income and expenses
in our condensed consolidated financial statements. We have elected
the fair value option on the assets and liabilities held within the
Consolidated K-Series, which requires that changes in valuations in
the assets and liabilities of the Consolidated K-Series be
reflected in our condensed consolidated statements of
operations.
A reconciliation of our net capital allocated to
multi-family investments to our condensed consolidated financial
statements as of March 31, 2018 is set forth below (dollar
amounts in thousands):
Multi-family loans held
in securitization trusts, at fair value |
$ |
9,438,309 |
|
Multi-family CDOs, at
fair value |
(8,953,467 |
) |
Net carrying value |
484,842 |
|
Investment securities
available for sale, at fair value |
139,713 |
|
Total CMBS, at fair
value |
624,555 |
|
Preferred equity
investments, mezzanine loans and investments in unconsolidated
entities |
193,023 |
|
Real estate under
development (1) |
21,553 |
|
Real estate held for
sale in consolidated variable interest entities |
29,293 |
|
Mortgages and notes
payable in consolidated variable interest entities |
(32,072 |
) |
Financing arrangements,
portfolio investments |
(315,931 |
) |
Securitized debt |
(29,390 |
) |
Cash and other |
9,782 |
|
Net Capital in
Multi-Family |
$ |
500,813 |
|
|
|
|
|
(1) |
Included in
the Company’s accompanying condensed consolidated balance sheets in
receivables and other assets. |
A reconciliation of our net interest income in
multi-family investments to our condensed consolidated financial
statements for the three months ended March 31, 2018 is set
forth below (dollar amounts in thousands):
|
Three Months Ended March 31, 2018 |
Interest income,
multi-family loans held in securitization trusts |
$ |
85,092 |
|
Interest income,
investment securities, available for sale (1) |
2,434 |
|
Interest income,
mezzanine loan and preferred equity investments (1) |
4,445 |
|
Interest expense,
multi-family collateralized debt obligation |
(74,478 |
) |
Interest income,
Multi-Family, net |
17,493 |
|
Interest expense,
investment securities, available for sale |
(3,171 |
) |
Interest expense,
securitized debt |
(719 |
) |
Net interest income,
Multi-Family |
$ |
13,603 |
|
|
|
|
|
(1) |
Included in the
Company’s accompanying condensed consolidated statements of
operations in interest income, investment securities and
other. |
Cautionary Statement Regarding
Forward-Looking Statements
When used in this press release, in future
filings with the Securities and Exchange Commission (“SEC”) or in
other written or oral communications, statements which are not
historical in nature, including those containing words such as
“believe,” “expect,” “anticipate,” “estimate,” “plan,” “continue,”
“intend,” “should,” “would,” “could,” “goal,” “objective,” “will,”
“may” or similar expressions, are intended to identify
“forward-looking statements” within the meaning of Section 27A of
the Securities Act of 1933, as amended, and Section 21E of the
Securities Exchange Act of 1934, as amended ("Exchange Act"), and,
as such, may involve known and unknown risks, uncertainties and
assumptions.
Forward-looking statements are based on the
Company’s beliefs, assumptions and expectations of its future
performance, taking into account all information currently
available to it. These beliefs, assumptions and expectations are
subject to risks and uncertainties and can change as a result of
many possible events or factors, not all of which are known to the
Company. If a change occurs, the Company’s business, financial
condition, liquidity and results of operations may vary materially
from those expressed in its forward-looking statements. The
following factors are examples of those that could cause actual
results to vary from the Company’s forward-looking statements:
changes in interest rates and the market value of the Company’s
investments; changes in credit spreads; changes in the long-term
credit ratings of the U.S., Fannie Mae, Freddie Mac, and Ginnie
Mae; market volatility; changes in the prepayment rates on the
mortgage loans underlying the Company’s investment securities;
increased rates of default and/or decreased recovery rates on the
Company's assets; delays in identifying and acquiring the Company’s
targeted assets; the Company’s ability to borrow to finance its
assets and the terms thereof; changes in governmental laws,
regulations or policies affecting the Company’s business; changes
in the Company's relationship with its external manager; the
Company’s ability to maintain its qualification as a REIT for
federal tax purposes; the Company’s ability to maintain its
exemption from registration under the Investment Company Act of
1940, as amended; and risks associated with investing in real
estate assets, including changes in business conditions and the
general economy. These and other risks, uncertainties and factors,
including the risk factors described in the Company’s reports filed
with the SEC pursuant to the Exchange Act, could cause the
Company’s actual results to differ materially from those projected
in any forward-looking statements it makes. All forward-looking
statements speak only as of the date on which they are made. New
risks and uncertainties arise over time and it is not possible to
predict those events or how they may affect the Company. Except as
required by law, the Company is not obligated to, and does not
intend to, update or revise any forward-looking statements, whether
as a result of new information, future events or otherwise.
For Further Information
CONTACT: |
|
AT THE
COMPANYEmily StillerControllerPhone: (980) 224-4186Email:
estiller@nymtrust.com |
|
|
|
FINANCIAL TABLES FOLLOW
NEW YORK MORTGAGE TRUST, INC. AND
SUBSIDIARIESCONDENSED CONSOLIDATED BALANCE
SHEETS(Dollar amounts in thousands, except share
data)
|
March 31,2018 |
|
December 31,2017 |
|
(unaudited) |
|
|
ASSETS |
|
|
|
Investment securities,
available for sale, at fair value (including
pledged securities of$1,077,540 and $1,076,187, as of March
31, 2018 and December 31, 2017, respectivelyand $48,857 and $47,922
held in securitization trusts as of March 31, 2018 andDecember 31,
2017, respectively) |
$ |
1,400,370 |
|
|
$ |
1,413,081 |
|
Residential mortgage
loans held in securitization trusts, net |
70,864 |
|
|
73,820 |
|
Residential mortgage
loans, at fair value |
99,480 |
|
|
87,153 |
|
Distressed residential
mortgage loans, net (including $119,201 and $121,791 held
insecuritization trusts as of March 31, 2018 and December 31, 2017,
respectively) |
322,072 |
|
|
331,464 |
|
Multi-family loans held
in securitization trusts, at fair value |
9,438,309 |
|
|
9,657,421 |
|
Derivative assets |
9,815 |
|
|
846 |
|
Cash and cash
equivalents |
65,495 |
|
|
95,191 |
|
Investment in
unconsolidated entities |
51,921 |
|
|
51,143 |
|
Preferred equity and
mezzanine loan investments |
154,006 |
|
|
138,920 |
|
Real estate held for
sale in consolidated variable interest entities |
29,293 |
|
|
64,202 |
|
Goodwill |
25,222 |
|
|
25,222 |
|
Receivables and other
assets |
99,032 |
|
|
117,822 |
|
Total Assets
(1) |
$ |
11,765,879 |
|
|
$ |
12,056,285 |
|
LIABILITIES AND STOCKHOLDERS' EQUITY |
|
|
|
Liabilities: |
|
|
|
Financing arrangements,
portfolio investments |
$ |
1,287,314 |
|
|
$ |
1,276,918 |
|
Financing arrangements,
residential mortgage loans |
149,049 |
|
|
149,063 |
|
Residential
collateralized debt obligations |
67,154 |
|
|
70,308 |
|
Multi-family
collateralized debt obligations, at fair value |
8,953,467 |
|
|
9,189,459 |
|
Securitized debt |
70,215 |
|
|
81,537 |
|
Mortgages and notes
payable in consolidated variable interest entities |
32,072 |
|
|
57,124 |
|
Accrued expenses and
other liabilities |
81,579 |
|
|
82,126 |
|
Subordinated
debentures |
45,000 |
|
|
45,000 |
|
Convertible notes |
129,242 |
|
|
128,749 |
|
Total
liabilities (1) |
10,815,092 |
|
|
11,080,284 |
|
Commitments and
Contingencies |
|
|
|
Stockholders'
Equity: |
|
|
|
Preferred stock, $0.01
par value, 7.75% Series B cumulative redeemable, $25
liquidationpreference per share, 6,000,000 shares authorized,
3,000,000 shares issued andoutstanding |
72,397 |
|
|
72,397 |
|
Preferred stock, $0.01
par value, 7.875% Series C cumulative redeemable, $25
liquidationpreference per share, 4,140,000 shares authorized,
3,600,000 shares issued andoutstanding |
86,862 |
|
|
86,862 |
|
Preferred stock, $0.01
par value, 8.00% Series D Fixed-to-Floating Rate
cumulativeredeemable, $25 liquidation preference per share,
5,750,000 shares authorized and5,400,000 shares issued and
outstanding |
130,496 |
|
|
130,496 |
|
Common stock, $0.01 par
value, 400,000,000 shares authorized, 112,116,506 and111,909,909
shares issued and outstanding as of March 31, 2018 and December
31,2017, respectively |
1,121 |
|
|
1,119 |
|
Additional paid-in
capital |
751,542 |
|
|
751,155 |
|
Accumulated other
comprehensive (loss) income |
(18,925 |
) |
|
5,553 |
|
Accumulated
deficit |
(74,447 |
) |
|
(75,717 |
) |
Company's stockholders'
equity |
949,046 |
|
|
971,865 |
|
Non-controlling
interest in consolidated variable interest entities |
1,741 |
|
|
4,136 |
|
Total
equity |
950,787 |
|
|
976,001 |
|
Total
Liabilities and Stockholders' Equity |
$ |
11,765,879 |
|
|
$ |
12,056,285 |
|
|
|
|
|
|
|
|
|
(1) |
Our
condensed consolidated balance sheets include assets and
liabilities of consolidated variable interest entities ("VIEs") as
the Company is the primary beneficiary of these VIEs. As of
March 31, 2018 and December 31, 2017, assets of
consolidated VIEs totaled $9,771,205 and $10,041,468, respectively,
and the liabilities of consolidated VIEs totaled $9,157,640 and
$9,436,421, respectively. |
NEW YORK MORTGAGE TRUST, INC. AND
SUBSIDIARIESCONDENSED CONSOLIDATED STATEMENTS OF
OPERATIONS(Dollar amounts in thousands, except per
share data)(unaudited)
|
For the Three Months Ended March
31, |
|
2018 |
|
2017 |
INTEREST INCOME: |
|
|
|
Investment securities and other |
$ |
16,258 |
|
|
$ |
9,801 |
|
Multi-family loans held in securitization trusts |
85,092 |
|
|
61,304 |
|
Residential mortgage loans |
2,187 |
|
|
1,242 |
|
Distressed residential mortgage loans |
5,354 |
|
|
6,038 |
|
Total
interest income |
108,891 |
|
|
78,385 |
|
|
|
|
|
INTEREST EXPENSE: |
|
|
|
Investment securities and other |
9,651 |
|
|
5,569 |
|
Convertible notes |
2,649 |
|
|
1,975 |
|
Multi-family collateralized debt obligations |
74,478 |
|
|
53,932 |
|
Residential collateralized debt obligations |
411 |
|
|
336 |
|
Securitized debt |
1,330 |
|
|
2,115 |
|
Subordinated debentures |
620 |
|
|
540 |
|
Total
interest expense |
89,139 |
|
|
64,467 |
|
|
|
|
|
NET INTEREST
INCOME |
19,752 |
|
|
13,918 |
|
|
|
|
|
OTHER INCOME
(LOSS): |
|
|
|
(Provision for) recovery of loan losses |
(42 |
) |
|
188 |
|
Realized
loss on investment securities and related hedges, net |
(3,423 |
) |
|
(1,223 |
) |
Realized
(loss) gain on distressed residential mortgage loans at carrying
value, net |
(773 |
) |
|
11,971 |
|
Net loss
on residential mortgage loans at fair value |
(166 |
) |
|
— |
|
Unrealized gain on investment securities and related hedges,
net |
11,692 |
|
|
1,546 |
|
Unrealized gain on multi-family loans and debt held in
securitization trusts, net |
7,545 |
|
|
1,384 |
|
Income
from operating real estate and real estate held for sale in
consolidated variable interest entities |
2,126 |
|
|
— |
|
Other
income |
3,994 |
|
|
2,839 |
|
Total
other income |
20,953 |
|
|
16,705 |
|
|
|
|
|
GENERAL, ADMINISTRATIVE
AND OPERATING EXPENSES: |
|
|
|
General
and administrative expenses |
4,656 |
|
|
4,887 |
|
Base
management and incentive fees |
833 |
|
|
3,078 |
|
Expenses
related to distressed residential mortgage loans |
1,603 |
|
|
2,239 |
|
Expenses
related to operating real estate and real estate held for sale in
consolidated variable interest entities |
1,606 |
|
|
— |
|
Total
general, administrative and operating expenses |
8,698 |
|
|
10,204 |
|
|
|
|
|
INCOME FROM OPERATIONS
BEFORE INCOME TAXES |
32,007 |
|
|
20,419 |
|
Income tax (benefit)
expense |
(79 |
) |
|
1,237 |
|
NET INCOME |
32,086 |
|
|
19,182 |
|
Net income attributable
to non-controlling interest in consolidated variable interest
entities |
(2,468 |
) |
|
— |
|
NET INCOME ATTRIBUTABLE
TO COMPANY |
29,618 |
|
|
19,182 |
|
Preferred stock
dividends |
(5,925 |
) |
|
(3,225 |
) |
NET INCOME ATTRIBUTABLE
TO COMPANY'S COMMON STOCKHOLDERS |
$ |
23,693 |
|
|
$ |
15,957 |
|
|
|
|
|
Basic earnings per
common share |
$ |
0.21 |
|
|
$ |
0.14 |
|
Diluted earnings per
common share |
$ |
0.20 |
|
|
$ |
0.14 |
|
Weighted average shares
outstanding-basic |
112,018 |
|
|
111,721 |
|
Weighted average shares
outstanding-diluted |
131,761 |
|
|
126,602 |
|
|
|
|
|
|
|
NEW YORK MORTGAGE TRUST, INC. AND
SUBSIDIARIESSUMMARY OF QUARTERLY
EARNINGS(Dollar amounts in thousands, except per
share data)(unaudited)
|
For the Three Months Ended |
|
March 31, 2018 |
|
December 31, 2017 |
|
September 30, 2017 |
|
June 30, 2017 |
|
March 31, 2017 |
Net interest
income |
$ |
19,752 |
|
|
$ |
15,040 |
|
|
$ |
13,320 |
|
|
$ |
15,708 |
|
|
$ |
13,918 |
|
Total other income |
20,953 |
|
|
25,218 |
|
|
24,918 |
|
|
8,172 |
|
|
16,705 |
|
Total general,
administrative and operating expenses |
8,698 |
|
|
8,288 |
|
|
10,996 |
|
|
11,589 |
|
|
10,204 |
|
Income from operations
before income taxes |
32,007 |
|
|
31,970 |
|
|
27,242 |
|
|
12,291 |
|
|
20,419 |
|
Income tax (benefit)
expense |
(79 |
) |
|
1,169 |
|
|
507 |
|
|
442 |
|
|
1,237 |
|
Net income |
32,086 |
|
|
30,801 |
|
|
26,735 |
|
|
11,849 |
|
|
19,182 |
|
Net (income) loss
attributable to non-controlling interest in consolidated variable
interest entities |
(2,468 |
) |
|
(184 |
) |
|
1,110 |
|
|
2,487 |
|
|
— |
|
Net income attributable
to Company |
29,618 |
|
|
30,617 |
|
|
27,845 |
|
|
14,336 |
|
|
19,182 |
|
Preferred stock
dividends |
(5,925 |
) |
|
(5,985 |
) |
|
(3,225 |
) |
|
(3,225 |
) |
|
(3,225 |
) |
Net income attributable
to Company's common stockholders |
23,693 |
|
|
24,632 |
|
|
24,620 |
|
|
11,111 |
|
|
15,957 |
|
Basic earnings per
common share |
$ |
0.21 |
|
|
$ |
0.22 |
|
|
$ |
0.22 |
|
|
$ |
0.10 |
|
|
$ |
0.14 |
|
Diluted earnings per
common share |
$ |
0.20 |
|
|
$ |
0.21 |
|
|
$ |
0.21 |
|
|
$ |
0.10 |
|
|
$ |
0.14 |
|
Weighted average shares
outstanding - basic |
112,018 |
|
|
111,871 |
|
|
111,886 |
|
|
111,863 |
|
|
111,721 |
|
Weighted average shares
outstanding - diluted |
131,761 |
|
|
131,565 |
|
|
131,580 |
|
|
111,863 |
|
|
126,602 |
|
|
|
|
|
|
|
|
|
|
|
Book value per common
share |
$ |
5.79 |
|
|
$ |
6.00 |
|
|
$ |
6.05 |
|
|
$ |
6.02 |
|
|
$ |
6.08 |
|
Dividends declared per
common share |
$ |
0.20 |
|
|
$ |
0.20 |
|
|
$ |
0.20 |
|
|
$ |
0.20 |
|
|
$ |
0.20 |
|
Dividends declared per
preferred share on Series B Preferred Stock |
$ |
0.48 |
|
|
$ |
0.48 |
|
|
$ |
0.48 |
|
|
$ |
0.48 |
|
|
$ |
0.48 |
|
Dividends declared per
preferred share on Series C Preferred Stock |
$ |
0.49 |
|
|
$ |
0.49 |
|
|
$ |
0.49 |
|
|
$ |
0.49 |
|
|
$ |
0.49 |
|
Dividends declared per
preferred share on Series D Preferred Stock |
$ |
0.50 |
|
|
$ |
0.51 |
|
|
— |
|
|
— |
|
|
— |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Capital Allocation Summary
The following tables set forth our allocated
capital by investment type as well as the weighted average yield on
interest earning assets, average cost of funds and portfolio net
interest margin for our interest earning assets for the periods
indicated (dollar amounts in thousands):
|
Agency RMBS |
|
Multi-Family |
|
Distressed Residential |
|
Other |
|
Total |
At March 31,
2018 |
|
|
|
|
|
|
|
|
|
Carrying
value |
$ |
1,161,445 |
|
|
$ |
836,353 |
|
|
$ |
461,305 |
|
|
$ |
150,461 |
|
|
$ |
2,609,564 |
|
Net
capital allocated |
$ |
251,405 |
|
|
$ |
500,813 |
|
|
$ |
282,561 |
|
|
$ |
(83,992 |
) |
|
$ |
950,787 |
|
Three Months
Ended March 31, 2018 |
|
|
|
|
|
|
|
|
|
Average
interest earning assets |
$ |
1,208,900 |
|
|
$ |
612,357 |
|
|
$ |
467,898 |
|
|
$ |
136,135 |
|
|
$ |
2,425,290 |
|
Weighted
average yield on interest earning assets |
2.64 |
% |
|
11.43 |
% |
|
6.25 |
% |
|
4.81 |
% |
|
5.68 |
% |
Less:
Average cost of funds |
(1.82 |
)% |
|
(4.51 |
)% |
|
(4.45 |
)% |
|
(3.25 |
)% |
|
(2.82 |
)% |
Portfolio
net interest margin |
0.82 |
% |
|
6.92 |
% |
|
1.80 |
% |
|
1.56 |
% |
|
2.86 |
% |
|
|
|
|
|
|
|
|
|
|
At December 31,
2017 |
|
|
|
|
|
|
|
|
|
Carrying
value |
$ |
1,169,535 |
|
|
$ |
816,805 |
|
|
$ |
474,128 |
|
|
$ |
140,325 |
|
|
$ |
2,600,793 |
|
Net
capital allocated |
$ |
264,801 |
|
|
$ |
475,200 |
|
|
$ |
285,766 |
|
|
$ |
(49,766 |
) |
|
$ |
976,001 |
|
Three Months
Ended December 31, 2017 |
|
|
|
|
|
|
|
|
|
Average
interest earning assets |
$ |
971,707 |
|
|
$ |
596,701 |
|
|
$ |
480,711 |
|
|
$ |
126,447 |
|
|
$ |
2,175,566 |
|
Weighted
average yield on interest earning assets |
2.50 |
% |
|
11.11 |
% |
|
3.68 |
% |
|
4.53 |
% |
|
5.24 |
% |
Less:
Average cost of funds |
(1.68 |
)% |
|
(4.49 |
)% |
|
(4.56 |
)% |
|
(3.22 |
)% |
|
(2.85 |
)% |
Portfolio
net interest margin |
0.82 |
% |
|
6.62 |
% |
|
(0.88 |
)% |
|
1.31 |
% |
|
2.39 |
% |
|
|
|
|
|
|
|
|
|
|
At September
30, 2017 |
|
|
|
|
|
|
|
|
|
Carrying
value |
$ |
417,957 |
|
|
$ |
723,170 |
|
|
$ |
535,520 |
|
|
$ |
136,304 |
|
|
$ |
1,812,951 |
|
Net
capital allocated |
$ |
90,526 |
|
|
$ |
495,882 |
|
|
$ |
305,668 |
|
|
$ |
(46,071 |
) |
|
$ |
846,005 |
|
Three Months
Ended September 30, 2017 |
|
|
|
|
|
|
|
|
|
Average
interest earning assets |
$ |
453,323 |
|
|
$ |
536,537 |
|
|
$ |
531,050 |
|
|
$ |
126,848 |
|
|
$ |
1,647,758 |
|
Weighted
average yield on interest earning assets |
1.70 |
% |
|
11.39 |
% |
|
4.37 |
% |
|
4.21 |
% |
|
5.91 |
% |
Less:
Average cost of funds |
(1.44 |
)% |
|
(4.46 |
)% |
|
(4.28 |
)% |
|
(2.57 |
)% |
|
(3.10 |
)% |
Portfolio
net interest margin |
0.26 |
% |
|
6.93 |
% |
|
0.09 |
% |
|
1.64 |
% |
|
2.81 |
% |
|
|
|
|
|
|
|
|
|
|
At June 30,
2017 |
|
|
|
|
|
|
|
|
|
Carrying
value |
$ |
449,437 |
|
|
$ |
749,643 |
|
|
$ |
568,273 |
|
|
$ |
133,488 |
|
|
$ |
1,900,841 |
|
Net
capital allocated |
$ |
110,497 |
|
|
$ |
508,068 |
|
|
$ |
290,414 |
|
|
$ |
(65,536 |
) |
|
$ |
843,443 |
|
Three Months
Ended June 30, 2017 |
|
|
|
|
|
|
|
|
|
Average
interest earning assets |
$ |
485,194 |
|
|
$ |
529,285 |
|
|
$ |
621,936 |
|
|
$ |
123,711 |
|
|
$ |
1,760,126 |
|
Weighted
average yield on interest earning assets |
1.65 |
% |
|
11.10 |
% |
|
5.91 |
% |
|
3.96 |
% |
|
6.16 |
% |
Less:
Average cost of funds |
(1.30 |
)% |
|
(4.28 |
)% |
|
(4.29 |
)% |
|
(2.13 |
)% |
|
(3.04 |
)% |
Portfolio
net interest margin |
0.35 |
% |
|
6.82 |
% |
|
1.62 |
% |
|
1.83 |
% |
|
3.12 |
% |
|
|
|
|
|
|
|
|
|
|
At March 31,
2017 |
|
|
|
|
|
|
|
|
|
Carrying
value |
$ |
481,960 |
|
|
$ |
733,383 |
|
|
$ |
645,455 |
|
|
$ |
132,266 |
|
|
$ |
1,993,064 |
|
Net
capital allocated |
$ |
133,070 |
|
|
$ |
501,133 |
|
|
$ |
285,708 |
|
|
$ |
(67,165 |
) |
|
$ |
852,746 |
|
Three Months
Ended March 31, 2017 |
|
|
|
|
|
|
|
|
|
Average
interest earning assets |
$ |
529,485 |
|
|
$ |
457,943 |
|
|
$ |
661,738 |
|
|
$ |
120,372 |
|
|
$ |
1,769,538 |
|
Weighted
average yield on interest earning assets |
1.97 |
% |
|
11.31 |
% |
|
4.69 |
% |
|
3.73 |
% |
|
5.53 |
% |
Less:
Average cost of funds |
(1.23 |
)% |
|
(4.55 |
)% |
|
(3.71 |
)% |
|
(2.81 |
)% |
|
(2.83 |
)% |
Portfolio
net interest margin |
0.74 |
% |
|
6.76 |
% |
|
0.98 |
% |
|
0.92 |
% |
|
2.70 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
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