Arbor Realty Trust, Inc. (NYSE:ABR), today announced financial
results for the first quarter ended March 31, 2020. Arbor
reported a net loss for the quarter of $59.3 million, or $0.54 per
diluted common share, compared to net income of $22.7 million, or
$0.26 per diluted common share for the quarter ended March 31,
2019. Core earnings for the quarter was $40.7 million, or
$0.31 per diluted common share, compared to $36.1 million, or $0.33
per diluted common share for the quarter ended March 31, 2019.1
At March 31, 2020, GAAP book value per share was
$8.68, as compared to $9.73 at December 31, 2019. The decrease in
book value was primarily due to $104.5 million, or $0.80 per share,
of estimated credit losses on our portfolios, including the
adoption of the new accounting standard for current expected credit
losses, or “CECL,” as well as $50.7 million, or $0.39 per share, of
losses on derivative instruments associated with loans that have
not yet been sold or securitized.
Agency
Business
Loan
Origination Platform
Agency Loan Volume (in thousands) |
|
|
Quarter Ended |
|
|
March 31,2020 |
|
December 31,2019 |
Originations: |
|
|
|
Fannie Mae |
$ |
581,973 |
|
$ |
764,314 |
Freddie Mac |
|
199,711 |
|
|
96,993 |
FHA |
|
|
17,944 |
|
|
78,428 |
Private Label |
|
282,345 |
|
|
320,476 |
Total Originations |
$ |
1,081,973 |
|
$ |
1,260,211 |
|
|
|
|
|
Total Loan Sales |
$ |
957,060 |
|
$ |
887,868 |
|
|
|
|
|
Total Loan Commitments |
$ |
1,267,219 |
|
$ |
1,203,194 |
|
|
|
|
|
For the quarter ended March 31, 2020, the Agency
Business generated revenues (excluding gains and losses on
derivative instruments) of $59.6 million, compared to $64.2 million
for the fourth quarter of 2019. Gain on sales, including fee-based
services, net was $14.3 million for the quarter, reflecting a
margin of 1.49% on loan sales, compared to $13.8 million and 1.55%
for the fourth quarter of 2019. Income from mortgage servicing
rights was $21.9 million for the quarter, reflecting a rate of
1.73% as a percentage of loan commitments, compared to $27.9
million and 2.32% for the fourth quarter of 2019.
At March 31, 2020,
loans held-for-sale was $991.7 million which was primarily
comprised of unpaid principal balances totaling $978.7 million,
with financing associated with these loans totaling $790.7
million.
Fee-Based
Servicing Portfolio
Our fee-based
servicing portfolio totaled $20.20 billion at March 31, 2020, an
increase of 0.7% from December 31, 2019, primarily a result of
$799.6 million of new loan originations (excluding $282.3 million
of private label loans that are yet to be sold), net of $661.6
million in portfolio runoff during the quarter. Servicing revenue,
net was $13.3 million for the quarter and consisted of servicing
revenue of $25.1 million, net of amortization of mortgage servicing
rights totaling $11.8 million.
|
|
|
|
|
Fee-Based Servicing Portfolio ($ in thousands) |
|
|
As of March 31, 2020 |
|
As of December 31, 2019 |
|
|
UPB |
Wtd. Avg.Fee |
Wtd. Avg. Life(in years) |
|
UPB |
Wtd. Avg.Fee |
Wtd. Avg. Life(in years) |
Fannie Mae |
$ |
14,946,922 |
0.493 |
% |
8.0 |
|
$ |
14,832,844 |
0.493 |
% |
7.8 |
Freddie Mac |
|
4,570,521 |
0.294 |
% |
10.6 |
|
|
4,534,714 |
0.300 |
% |
10.6 |
FHA |
|
|
679,685 |
0.152 |
% |
19.1 |
|
|
691,519 |
0.154 |
% |
18.7 |
Total |
|
$ |
20,197,128 |
0.436 |
% |
8.9 |
|
$ |
20,059,077 |
0.438 |
% |
8.8 |
|
|
|
|
|
|
|
|
|
Loans sold under the Fannie Mae program contain an obligation to
partially guarantee the performance of the loan (“loss-sharing
obligations”), and includes $32.4 million for the fair value of the
guarantee obligation undertaken at March 31, 2020. The Company’s
loss-sharing obligations associated with CECL were $38.4 million,
including a $14.4 million January 1, 2020 adoption adjustment,
representing 0.26% of the Fannie Mae servicing portfolio at March
31, 2020.
Structured
Business
Portfolio and Investment
Activity
- Originated 47 loans totaling $856.2 million, of which $798.2
million was funded at March 31, 2020, and consisted primarily of 34
bridge loans totaling $785.1 million
- Payoffs and pay downs on 21 loans totaling $275.3 million
- Portfolio growth of $520.9 million, or 12%
- No material loan modifications that resulted in interest rate
concessions
- Provision for loan losses of $54.4 million from CECL
At March 31, 2020, the
loan and investment portfolio’s unpaid principal balance, excluding
loan loss reserves, was $4.80 billion, with a weighted average
current interest pay rate of 5.70%, compared to $4.29 billion and
5.98% at December 31, 2019. Including certain fees earned and
costs associated with the loan and investment portfolio, the
weighted average current interest pay rate was 6.35% at March 31,
2020, compared to 6.68% at December 31, 2019.
The average balance of
the Company’s loan and investment portfolio during the first
quarter of 2020, excluding loan loss reserves, was $4.58 billion
with a weighted average yield of 6.77%, compared to $4.02 billion
and 7.18% for the fourth quarter of 2019. The decrease in average
yield was primarily due to lower rates on originations when
compared to runoff and a decrease in LIBOR in the first quarter as
compared to the fourth quarter.
During the first quarter of 2020, the Company
recorded a provision for loan losses of $54.4 million as a result
of its loan review process including the newly adopted CECL credit
loss standard which included a January 1, 2020 CECL adoption
adjustment of $17.3 million. At March 31, 2020, the Company’s total
allowance for loan losses was $142.3 million. The Company had
four non-performing loans with a carrying value of $8.3 million,
before related loan loss reserves of $6.5 million, compared to
three loans with a carrying value of $3.5 million, before related
loan loss reserves of $1.7 million as of December 31, 2019.
Financing
Activity
The Company completed
a collateralized securitization vehicle (“CLO XIII”) totaling
$800.0 million of real estate related assets and cash. Investment
grade-rated notes totaling $668.0 million were issued, and the
Company retained subordinate interests in the issuing vehicle of
$132.0 million. The facility has a three-year asset replenishment
period and an initial weighted average interest rate of 1.41% over
LIBOR, excluding fees and transaction costs.
The Company completed
the unwind of CLO VIII, redeeming $282.9 million of outstanding
notes, which were repaid primarily from the refinancing of the
remaining assets primarily within CLO XIII, as well as with cash
held by CLO VIII, and expensed $1.5 million of deferred financing
fees into loss on extinguishment of debt on the consolidated
statements of operations.
The balance of debt
that finances the Company’s loan and investment portfolio at March
31, 2020 was $4.70 billion with a weighted average interest rate
including fees of 3.68% as compared to $3.93 billion and a rate of
4.35% at December 31, 2019. The average balance of debt that
finances the Company’s loan and investment portfolio for the first
quarter of 2020 was $4.25 billion, as compared to $3.76 billion for
the fourth quarter of 2019. The average cost of borrowings for the
first quarter of 2020 was 4.11%, compared to 4.46% for the fourth
quarter of 2019. The decrease in average costs was primarily due to
a decrease in LIBOR and the issuance of lower cost CLO debt.
The Company is subject to various financial
covenants and restrictions under the terms of its collateralized
securitization vehicles, financing facilities and unsecured debt.
The Company believes it was in compliance with all financial
covenants and restrictions as of March 31, 2020 and as of the most
recent collateralized securitization vehicle determination dates in
April 2020.
Capital
Markets
The Company issued $275.0 million in
aggregate principal amount of 4.50% senior unsecured notes due in
2027 in a private placement, generating net proceeds of $271.8
million after deducting offering expenses. The Company used a
significant portion of the proceeds to repay secured
indebtedness.
In April 2020, the Company issued $40.5 million
in aggregate principal amount of 8.00% senior unsecured notes in a
private placement, generating net proceeds of $39.8 million after
deducting offering expenses. The notes are due in 2023 and the
proceeds were used to repay secured indebtedness, make investments
relating to its business and for general corporate purposes.
Dividends
The Company announced
today that its Board of Directors has declared a quarterly cash
dividend of $0.30 per share of common stock for the quarter ended
March 31, 2020. The dividend is payable on July 15, 2020 to common
stockholders of record on June 30, 2020. The ex-dividend date is
June 29, 2020.
As previously
announced, the Board of Directors has declared cash dividends on
the Company's Series A, Series B and Series C cumulative redeemable
preferred stock reflecting accrued dividends from March 1, 2020
through May 31, 2020. The dividends are payable on June 1, 2020 to
preferred stockholders of record on May 15, 2020. The Company will
pay total dividends of $0.515625, $0.484375 and $0.53125 per share
on the Series A, Series B and Series C preferred stock,
respectively.
Earnings
Conference Call
The Company will host
a conference call today at 10:00 a.m. Eastern Time. A live
webcast and replay of the conference call will be available at
http://www.arbor.com in the investor relations section of the
Company’s website. Those without web access should access the call
telephonically at least ten minutes prior to the conference call.
The dial-in numbers are (866) 516-5034 for domestic callers and
(678) 509-7613 for international callers. Please use participant
passcode 6874348.
A telephonic replay of
the call will be available until May 15, 2020. The replay dial-in
numbers are (855) 859-2056 for domestic callers and (404) 537-3406
for international callers. Please use passcode 6874348.
About Arbor
Realty Trust, Inc.
Arbor Realty Trust, Inc. (NYSE:ABR) is a
nationwide real estate investment trust and direct lender,
providing loan origination and servicing for multifamily, seniors
housing, healthcare and other diverse commercial real estate
assets. Headquartered in New York, Arbor manages a
multibillion-dollar servicing portfolio, specializing in
government-sponsored enterprise products. Arbor is a Fannie Mae
DUS® lender and Freddie Mac Optigo Seller/Servicer. Arbor’s product
platform also includes CMBS, bridge, mezzanine and preferred equity
lending. Rated by Standard and Poor’s and Fitch Ratings, Arbor is
committed to building on its reputation for service, quality and
customized solutions with an unparalleled dedication to providing
our clients excellence over the entire life of a loan.
Safe Harbor
Statement
Certain items in this
press release may constitute forward-looking statements within the
meaning of the “safe harbor” provisions of the Private Securities
Litigation Reform Act of 1995. These statements are based on
management’s current expectations and beliefs and are subject to a
number of trends and uncertainties that could cause actual results
to differ materially from those described in the forward-looking
statements. Arbor can give no assurance that its expectations will
be attained. Factors that could cause actual results to
differ materially from Arbor’s expectations include, but are not
limited to, changes in economic conditions generally, and the real
estate markets specifically, in particular, due to the
uncertainties created by the COVID-19 pandemic, continued ability
to source new investments, changes in interest rates and/or credit
spreads, and other risks detailed in Arbor’s Annual Report on Form
10-K for the year ended December 31, 2019 and its other reports
filed with the SEC. Such forward-looking statements speak only as
of the date of this press release. Arbor expressly disclaims any
obligation or undertaking to release publicly any updates or
revisions to any forward-looking statements contained herein to
reflect any change in Arbor’s expectations with regard thereto or
change in events, conditions, or circumstances on which any such
statement is based.
1. Non-GAAP
Financial Measures
During the quarterly
earnings conference call, the Company may discuss non-GAAP
financial measures as defined by SEC Regulation G. In addition, the
Company has used non-GAAP financial measures in this press release.
A supplemental schedule of non-GAAP financial measures and the
comparable GAAP financial measure can be found on page 11 of this
release.
|
|
|
Contacts:Arbor Realty Trust,
Inc.Paul Elenio, Chief Financial Officer 516-506-4422
pelenio@arbor.com |
Investors:The Ruth GroupAlexander
Lobo646-536-7037alobo@theruthgroup.com |
Media:Bonnie HabyanChief
Marketing Officer516-506-4615 bhabyan@arbor.com |
|
|
|
ARBOR REALTY TRUST, INC. AND SUBSIDIARIES |
Consolidated Statements of Operations - (Unaudited) |
($ in thousands—except share and per share data) |
|
|
|
|
|
|
|
|
|
Quarter Ended March 31, |
|
|
|
|
2020 |
|
|
|
2019 |
|
|
|
|
|
|
|
|
|
|
|
Interest income |
|
$ |
88,526 |
|
|
$ |
71,277 |
|
Interest expense |
|
|
49,982 |
|
|
|
41,865 |
|
|
Net interest income |
|
|
38,544 |
|
|
|
29,412 |
|
|
|
|
|
|
|
Other revenue: |
|
|
|
|
Gain on sales, including fee-based services, net |
|
|
14,305 |
|
|
|
16,389 |
|
Mortgage servicing rights |
|
|
21,934 |
|
|
|
14,232 |
|
Servicing revenue, net |
|
|
13,302 |
|
|
|
13,552 |
|
Property operating income |
|
|
2,192 |
|
|
|
2,803 |
|
Loss on derivative instruments, net |
|
|
(50,731 |
) |
|
|
(2,465 |
) |
Other income, net |
|
|
1,303 |
|
|
|
337 |
|
|
Total other revenue |
|
|
2,305 |
|
|
|
44,848 |
|
|
|
|
|
|
|
Other expenses: |
|
|
|
|
Employee compensation and benefits |
|
|
34,252 |
|
|
|
31,764 |
|
Selling and administrative |
|
|
11,052 |
|
|
|
9,761 |
|
Property operating expenses |
|
|
2,443 |
|
|
|
2,396 |
|
Depreciation and amortization |
|
|
1,947 |
|
|
|
1,912 |
|
Provision for loss sharing (net of recoveries) |
|
|
21,537 |
|
|
|
454 |
|
Provision for credit losses (net of recoveries) |
|
|
54,382 |
|
|
|
- |
|
|
Total other expenses |
|
|
125,613 |
|
|
|
46,287 |
|
|
|
|
|
|
|
(Loss) income before extinguishment of debt, income from |
|
|
|
equity affiliates and income taxes |
|
|
(84,764 |
) |
|
|
27,973 |
|
Loss on extinguishment of debt |
|
|
(1,954 |
) |
|
|
(128 |
) |
Income from equity affiliates |
|
|
3,992 |
|
|
|
2,151 |
|
Benefit from income taxes |
|
|
14,370 |
|
|
|
10 |
|
|
|
|
|
|
|
Net (loss) income |
|
|
(68,356 |
) |
|
|
30,006 |
|
|
|
|
|
|
|
Preferred stock dividends |
|
|
1,888 |
|
|
|
1,888 |
|
Net (loss) income attributable to noncontrolling interest |
|
(10,934 |
) |
|
|
5,468 |
|
Net (loss) income attributable to common stockholders |
|
$ |
(59,310 |
) |
|
$ |
22,650 |
|
|
|
|
|
|
|
Basic (loss) earnings per common share |
|
$ |
(0.54 |
) |
|
$ |
0.27 |
|
Diluted (loss) earnings per common share |
|
$ |
(0.54 |
) |
|
$ |
0.26 |
|
|
|
|
|
|
|
Weighted average shares outstanding: |
|
|
|
|
|
Basic |
|
|
110,792,412 |
|
|
|
85,151,878 |
|
|
Diluted |
|
|
131,217,199 |
|
|
|
107,869,511 |
|
|
|
|
|
|
|
Dividends declared per common share |
|
$ |
0.30 |
|
|
$ |
0.27 |
|
|
|
|
|
|
|
ARBOR REALTY TRUST, INC. AND SUBSIDIARIES |
Consolidated Balance Sheets |
($ in thousands—except share and per share data) |
|
|
|
|
|
|
|
|
|
|
|
|
March 31, |
|
December 31, |
|
|
|
2020 |
|
|
|
2019 |
|
|
|
(Unaudited) |
|
|
Assets: |
|
|
|
|
Cash and cash equivalents |
|
$ |
222,330 |
|
|
$ |
299,687 |
|
Restricted cash |
|
|
304,067 |
|
|
|
210,875 |
|
Loans and investments, net (allowance for credit losses of $142,252
and $71,069, respectively) |
|
|
4,638,004 |
|
|
|
4,189,960 |
|
Loans held-for-sale, net |
|
|
991,696 |
|
|
|
861,360 |
|
Capitalized mortgage servicing rights, net |
|
|
288,954 |
|
|
|
286,420 |
|
Securities held-to-maturity, net (allowance for credit losses of
$992 and $0, respectively) |
|
|
84,406 |
|
|
|
88,699 |
|
Investments in equity affiliates |
|
|
44,701 |
|
|
|
41,800 |
|
Real estate owned, net |
|
|
13,270 |
|
|
|
13,220 |
|
Due from related party |
|
|
13,821 |
|
|
|
10,651 |
|
Goodwill and other intangible assets |
|
|
109,371 |
|
|
|
110,700 |
|
Other assets |
|
|
224,030 |
|
|
|
125,788 |
|
Total assets |
|
$ |
6,934,650 |
|
|
$ |
6,239,160 |
|
|
|
|
|
|
Liabilities and Equity: |
|
|
|
|
Credit facilities and repurchase agreements |
|
$ |
1,846,473 |
|
|
$ |
1,678,288 |
|
Collateralized loan obligations |
|
|
2,513,096 |
|
|
|
2,130,121 |
|
Debt fund |
|
|
68,717 |
|
|
|
68,629 |
|
Senior unsecured notes |
|
|
591,854 |
|
|
|
319,799 |
|
Convertible senior unsecured notes, net |
|
|
264,689 |
|
|
|
284,152 |
|
Junior subordinated notes to subsidiary trust issuing preferred
securities |
|
|
141,128 |
|
|
|
140,949 |
|
Due to related party |
|
|
3,103 |
|
|
|
13,100 |
|
Due to borrowers |
|
|
81,447 |
|
|
|
79,148 |
|
Allowance for loss-sharing obligations |
|
|
70,752 |
|
|
|
34,648 |
|
Other liabilities |
|
|
127,341 |
|
|
|
134,299 |
|
Total liabilities |
|
|
5,708,600 |
|
|
|
4,883,133 |
|
|
|
|
|
|
Equity: |
|
|
|
|
Arbor Realty Trust, Inc. stockholders' equity: |
|
|
|
|
Preferred stock, cumulative, redeemable, $0.01 par value:
100,000,000 shares authorized; |
|
|
|
special voting preferred shares; 20,369,265 and 20,484,094 shares
issued and |
|
|
|
|
outstanding, respectively; 8.25% Series A, $38,788 aggregate
liquidation preference; |
|
|
|
1,551,500 shares issued and outstanding; 7.75% Series B, $31,500
aggregate |
|
|
|
|
liquidation preference; 1,260,000 shares issued and outstanding;
8.50% Series C, |
|
|
|
|
$22,500 aggregate liquidation preference; 900,000 shares issued and
outstanding |
|
|
89,500 |
|
|
|
89,501 |
|
Common stock, $0.01 par value: 500,000,000 shares authorized;
110,608,903 |
|
|
|
|
and 109,706,214 shares issued and outstanding, respectively |
|
|
1,106 |
|
|
|
1,097 |
|
Additional paid-in capital |
|
|
1,163,161 |
|
|
|
1,154,932 |
|
Accumulated deficit |
|
|
(177,589 |
) |
|
|
(60,920 |
) |
Total Arbor Realty Trust, Inc. stockholders’ equity |
|
|
1,076,178 |
|
|
|
1,184,610 |
|
|
|
|
|
|
Noncontrolling interest |
|
|
149,872 |
|
|
|
171,417 |
|
Total equity |
|
|
1,226,050 |
|
|
|
1,356,027 |
|
|
|
|
|
|
Total liabilities and equity |
|
$ |
6,934,650 |
|
|
$ |
6,239,160 |
|
|
|
|
|
|
ARBOR REALTY TRUST, INC. AND SUBSIDIARIES |
Statement of Operations Segment Information - (Unaudited) |
(in thousands) |
|
|
|
|
|
|
|
|
|
|
|
Quarter Ended March 31, 2020 |
|
|
|
|
|
|
|
|
|
|
|
StructuredBusiness |
|
AgencyBusiness |
|
Other /Eliminations (1) |
|
Consolidated |
|
|
|
|
|
|
|
|
|
Interest income |
|
$ |
78,477 |
|
|
$ |
10,049 |
|
|
$ |
- |
|
|
$ |
88,526 |
|
Interest expense |
|
|
43,399 |
|
|
|
6,583 |
|
|
|
- |
|
|
|
49,982 |
|
Net interest income |
|
|
35,078 |
|
|
|
3,466 |
|
|
|
- |
|
|
|
38,544 |
|
|
|
|
|
|
|
|
|
|
Other revenue: |
|
|
|
|
|
|
|
|
Gain on sales, including fee-based services, net |
|
|
- |
|
|
|
14,305 |
|
|
|
- |
|
|
|
14,305 |
|
Mortgage servicing rights |
|
|
- |
|
|
|
21,934 |
|
|
|
- |
|
|
|
21,934 |
|
Servicing revenue |
|
|
- |
|
|
|
25,124 |
|
|
|
- |
|
|
|
25,124 |
|
Amortization of MSRs |
|
|
- |
|
|
|
(11,822 |
) |
|
|
- |
|
|
|
(11,822 |
) |
Property operating income |
|
|
2,192 |
|
|
|
- |
|
|
|
- |
|
|
|
2,192 |
|
Loss on derivative instruments, net |
|
|
(3,000 |
) |
|
|
(47,731 |
) |
|
|
- |
|
|
|
(50,731 |
) |
Other income, net |
|
|
1,303 |
|
|
|
- |
|
|
|
- |
|
|
|
1,303 |
|
Total other revenue |
|
|
495 |
|
|
|
1,810 |
|
|
|
- |
|
|
|
2,305 |
|
|
|
|
|
|
|
|
|
|
Other expenses: |
|
|
|
|
|
|
|
|
Employee compensation and benefits |
|
|
10,846 |
|
|
|
23,406 |
|
|
|
- |
|
|
|
34,252 |
|
Selling and administrative |
|
|
4,450 |
|
|
|
6,602 |
|
|
|
- |
|
|
|
11,052 |
|
Property operating expenses |
|
|
2,443 |
|
|
|
- |
|
|
|
- |
|
|
|
2,443 |
|
Depreciation and amortization |
|
|
620 |
|
|
|
1,327 |
|
|
|
- |
|
|
|
1,947 |
|
Provision for loss sharing (net of recoveries) |
|
|
- |
|
|
|
21,537 |
|
|
|
- |
|
|
|
21,537 |
|
Provision for credit losses (net of recoveries) |
|
|
53,890 |
|
|
|
492 |
|
|
|
- |
|
|
|
54,382 |
|
Total other expenses |
|
|
72,249 |
|
|
|
53,364 |
|
|
|
- |
|
|
|
125,613 |
|
|
|
|
|
|
|
|
|
|
Loss before extinguishment of debt, income |
|
|
|
|
|
|
|
|
from equity affiliates and income taxes |
|
|
(36,676 |
) |
|
|
(48,088 |
) |
|
|
- |
|
|
|
(84,764 |
) |
Loss on extinguishment of debt |
|
|
(1,954 |
) |
|
|
- |
|
|
|
- |
|
|
|
(1,954 |
) |
Income from equity affiliates |
|
|
3,992 |
|
|
|
- |
|
|
|
- |
|
|
|
3,992 |
|
(Provision for) benefit from income taxes |
|
|
(83 |
) |
|
|
14,453 |
|
|
|
- |
|
|
|
14,370 |
|
|
|
|
|
|
|
|
|
|
Net loss |
|
|
(34,721 |
) |
|
|
(33,635 |
) |
|
|
- |
|
|
|
(68,356 |
) |
|
|
|
|
|
|
|
|
|
Preferred stock dividends |
|
|
1,888 |
|
|
|
- |
|
|
|
- |
|
|
|
1,888 |
|
Net loss attributable to noncontrolling interest |
|
|
- |
|
|
|
- |
|
|
|
(10,934 |
) |
|
|
(10,934 |
) |
Net (loss) income attributable to common stockholders |
|
$ |
(36,609 |
) |
|
$ |
(33,635 |
) |
|
$ |
10,934 |
|
|
$ |
(59,310 |
) |
|
|
|
|
|
|
|
|
|
(1) |
Includes certain income or expenses not allocated to the two
reportable segments. Amount reflects income attributable to
the noncontrolling interest holders. |
|
|
ARBOR REALTY TRUST, INC. AND SUBSIDIARIES |
Balance Sheet Segment Information - (Unaudited) |
(in thousands) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
March 31, 2020 |
|
|
StructuredBusiness |
|
AgencyBusiness |
|
Consolidated |
Assets: |
|
|
|
|
|
|
Cash and cash equivalents |
|
$ |
106,879 |
|
|
$ |
115,451 |
|
|
$ |
222,330 |
|
Restricted cash |
|
|
301,468 |
|
|
|
2,599 |
|
|
|
304,067 |
|
Loans and investments, net |
|
|
4,638,004 |
|
|
|
- |
|
|
|
4,638,004 |
|
Loans held-for-sale, net |
|
|
- |
|
|
|
991,696 |
|
|
|
991,696 |
|
Capitalized mortgage servicing rights, net |
|
|
- |
|
|
|
288,954 |
|
|
|
288,954 |
|
Securities held-to-maturity, net |
|
|
20,000 |
|
|
|
64,406 |
|
|
|
84,406 |
|
Investments in equity affiliates |
|
|
44,701 |
|
|
|
- |
|
|
|
44,701 |
|
Goodwill and other intangible assets |
|
|
12,500 |
|
|
|
96,871 |
|
|
|
109,371 |
|
Other assets |
|
|
174,409 |
|
|
|
76,712 |
|
|
|
251,121 |
|
Total assets |
|
$ |
5,297,961 |
|
|
$ |
1,636,689 |
|
|
$ |
6,934,650 |
|
|
|
|
|
|
|
|
Liabilities: |
|
|
|
|
|
|
Debt obligations |
|
$ |
4,635,218 |
|
|
$ |
790,739 |
|
|
$ |
5,425,957 |
|
Allowance for loss-sharing obligations |
|
- |
|
|
|
70,752 |
|
|
|
70,752 |
|
Other liabilities |
|
|
155,383 |
|
|
|
56,508 |
|
|
|
211,891 |
|
Total liabilities |
|
$ |
4,790,601 |
|
|
$ |
917,999 |
|
|
$ |
5,708,600 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
ARBOR REALTY TRUST, INC. AND SUBSIDIARIES |
Supplemental Schedule of Non-GAAP Financial Measures -
(Unaudited) |
Reconciliation of Core Earnings to GAAP Net (Loss) Income |
($ in thousands—except share and per share data) |
|
|
|
|
|
|
Quarter Ended March 31, |
|
|
2020 |
|
|
|
2019 |
|
|
|
|
|
Net (loss) income attributable to common stockholders |
$ |
(59,310 |
) |
|
$ |
22,650 |
|
|
|
|
|
Adjustments: |
|
|
|
Net (loss) income attributable to noncontrolling
interest |
|
(10,934 |
) |
|
|
5,468 |
|
Income from mortgage servicing rights |
|
(21,934 |
) |
|
|
(14,232 |
) |
Deferred tax benefit |
|
(19,904 |
) |
|
|
(4,168 |
) |
Amortization and write-offs of MSRs |
|
17,741 |
|
|
|
16,739 |
|
Depreciation and amortization |
|
2,958 |
|
|
|
2,865 |
|
Loss on extinguishment of debt |
|
1,954 |
|
|
|
128 |
|
Provision for credit losses |
|
75,919 |
|
|
|
454 |
|
Loss on derivative instruments, net |
|
50,731 |
|
|
|
2,465 |
|
Stock-based compensation |
|
3,517 |
|
|
|
3,756 |
|
|
|
|
|
Core earnings (1) |
$ |
40,738 |
|
|
$ |
36,125 |
|
|
|
|
|
Diluted core earnings per share (1) |
$ |
0.31 |
|
|
$ |
0.33 |
|
|
|
|
|
Diluted weighted average shares outstanding (1) |
|
131,217,199 |
|
|
|
107,869,511 |
|
|
|
|
|
(1) Amounts are
attributable to common stockholders and OP Unit holders. The OP
Units are redeemable for cash, or at the Company's option for
shares of the Company's common stock on a one-for-one basis. |
|
Beginning in the
first quarter of 2020, the Company is presenting core earnings as
its non-GAAP financial measure in replacement of adjusted funds
from operations ("AFFO"). Core earnings is comparable to our
previous AFFO metric, revised to exclude provisions for credit
losses (including CECL) related to our structured loan portfolio,
securities held-to-maturity and loss-sharing obligations related to
the Fannie Mae program. The Company is presenting core earnings
because management believes it is important supplemental measure of
the Company’s operating performance and is frequently used by
peers, analysts, investors and other parties in the evaluation of
REITs. Prior period amounts presented above have been conformed to
reflect this change. |
|
The Company defines
core earnings as net income (loss) attributable to common
stockholders (computed in accordance with GAAP) adjusted for
accounting items such as depreciation and amortization (adjusted
for unconsolidated joint ventures), non-cash stock-based
compensation expense, income from mortgage servicing rights
("MSRs"), amortization and write-offs of MSRs, gains and losses on
derivative instruments primarily associated with private label
loans that have not yet been sold and securitized, the cumulative
gains or losses on derivative instruments associated with private
label loans that were sold during the periods presented, changes in
fair value of GSE-related derivatives that temporarily flow through
earnings, deferred tax (benefit) provision, provisions for credit
losses (including CECL) and the amortization of the convertible
senior notes conversion option. The Company also adds back one-time
charges such as acquisition costs and one-time gains or losses on
the early extinguishment of debt. |
|
Core earnings is
not intended to be an indication of the Company's cash flow from
operating activities (determined in accordance with GAAP) or a
measure of its liquidity, nor is it entirely indicative of funding
the Company's cash needs, including its ability to make cash
distributions. The Company’s calculation of core earnings may be
different from the calculations used by other companies and,
therefore, comparability may be limited. |
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