Ares Commercial Real Estate Corporation (NYSE:ACRE) Q2 2023 Earnings Conference Call August 2, 2023 12:00 PM ET Company Participants John Stilmar - Managing Director, Investor Relations Bryan Donohoe - Chief Executive Officer Tae-Sik Yoon - Chief Financial Officer Conference Call Participants Rick Shane - JPMorgan Sarah Barcomb - BTIG Doug Harter - Credit Suisse Steve DeLaney - JMP Securities Jade Rahmani - KBW Derek Hewett - Bank of America Operator Good afternoon. Welcome to the Ares Commercial Real Estat ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 ___________________________________________________________________ FORM 10-Q ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended June 30, 2023 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from _____ to _____ Commission File No. 001-35517 ARES COMMERCIAL REAL ESTATE CORPORATION (Exact name of Re ...

Ares Commercial Real Estate Corporation (NYSE:ACRE) Q1 2023 Earnings Conference Call May 2, 2023 10:00 AM ET Company Participants John Stilmar - Managing Director and IR Bryan Donohoe - CEO Tae-Sik Yoon - CFO Conference Call Participants Steve DeLaney - JMP Securities Jade Rahmani - KBW Douglas Harter - Credit Suisse Stephen Laws - Raymond James Rick Shane - JPMorgan Sarah Barcomb - BTIG Derek Hewett - Bank of America Operator Good morning. Welcome to Ares Commercial Real Estate Corporation's First Quarter ...

Financial Performance - For the three months ended March 31, 2023, the company reported total revenue of $26.5 million, an increase from $24.0 million in the same period of 2022[191]. - The company experienced a net loss attributable to common stockholders of $6.4 million for the three months ended March 31, 2023, compared to a net income of $16.2 million in the same period of 2022[191]. - The net interest margin for the three months ended March 31, 2023, was approximately $26.5 million, compared to $21.4 million for the same period in 2022, reflecting the benefits from interest rate hedging and increased LIBOR and SOFR rates[191]. - The Company declared total cash dividends of $19,346,000 for the three months ended March 31, 2023, compared to $16,740,000 for the same period in 2022, representing an increase of approximately 15%[155]. - The Company recognized a realized gain of $2.2 million on the sale of a hotel property, which closed on March 1, 2022, with net sales proceeds exceeding the carrying value of the property[88]. Interest and Debt - The Company reported interest expense of $22.999 million for Q1 2023, an increase from $12.013 million in Q1 2022, reflecting a significant rise in secured funding agreements and securitization debt[50]. - Secured funding agreements increased to $12.311 million in Q1 2023 from $5.127 million in Q1 2022, indicating a strong growth in financing activities[50]. - The Company’s notes payable rose to $1.759 million in Q1 2023 compared to $453,000 in Q1 2022, showing an increase in borrowing[50]. - Securitization debt also saw an increase to $11.606 million in Q1 2023 from $4.351 million in Q1 2022, highlighting a growing reliance on securitization for funding[50]. - The outstanding balance of the Company's Financing Agreements as of March 31, 2023, is $953.2 million, with total commitments of $1,535.0 million[87]. Credit Losses and Reserves - Current expected credit losses (CECL) are reflected on both outstanding balances and unfunded commitments, impacting earnings and recorded within the provision for current expected credit losses[39]. - The CECL Reserve for loans held for investment increased to $92.3 million as of March 31, 2023, representing 387 basis points of the total loans held for investment commitment balance of $2.4 billion[79]. - Specific CECL reserves of $38.3 million and $5.6 million were assigned to the Illinois office loan and hotel loan, respectively, due to their downgraded risk ratings[80]. - The provision for current expected credit losses increased to $21.0 million for the three months ended March 31, 2023, compared to a provision of $(0.6) million for the same period in 2022[198]. Loan Portfolio and Investment - As of March 31, 2023, the Company held 53 loans for investment with an outstanding principal of approximately $2.2 billion, down from $2.5 billion in originated commitments[63]. - The Company funded approximately $26.4 million and received repayments of $72.8 million during the three months ended March 31, 2023[63]. - The total carrying value of loans held for investment is $2,173.2 million, with risk ratings distributed as follows: $19.1 million (Rating 1), $440.2 million (Rating 2), $1,230.1 million (Rating 3), $400.5 million (Rating 4), and $83.4 million (Rating 5)[84]. - Loans held for investment had a carrying value of $2.17 billion and a fair value of $2.09 billion as of March 31, 2023[141]. - The Company had five loans on non-accrual status with a carrying value of $173.3 million as of March 31, 2023, compared to three loans with a carrying value of $99.1 million as of December 31, 2022[76]. Risk Management - The Company is subject to macroeconomic conditions such as high inflation and interest rates, which could adversely impact its operations and borrowers[29]. - The Company actively manages various risks, including credit, interest rate, and market risks, to provide attractive risk-adjusted returns to stockholders[223]. - The Company has exposure to credit risk on its CRE loans held for investment and seeks to manage this risk through due diligence and ongoing portfolio review[224]. Facilities and Commitments - The Wells Fargo Facility allows borrowing up to $450.0 million, with a potential increase to $500.0 million, and has a funding period expiring on December 15, 2025[92]. - The Citibank Facility has an outstanding balance of $236.2 million and a total commitment of $325.0 million, with an initial maturity date of January 13, 2025[93]. - The CNB Facility has a total commitment of $75.0 million, with a maturity date extended to March 11, 2024, and incurs non-utilization fees of $70,000 for both Q1 2023 and Q1 2022[94]. - The MetLife Facility has a total commitment of $180.0 million, with an initial maturity date of August 13, 2023, and incurred a non-utilization fee of $73,000 for Q1 2023[95][97]. - The Company had total commitments of $2,388.3 million as of March 31, 2023, with total unfunded commitments amounting to $193.4 million[114]. Shareholder Returns - The company intends to maintain a debt-to-equity ratio not exceeding 4.5-to-1 to enhance potential returns to stockholders[219]. - The company anticipates distributing at least 90% of its REIT taxable income annually to stockholders, with potential tax implications for undistributed income[220]. - The Company did not conduct any stock repurchases under its $50.0 million Repurchase Program during the three months ended March 31, 2023[116]. - The company declared a regular cash dividend of $0.33 per common share and a supplemental cash dividend of $0.02 per common share for the second quarter of 2023[188].

Ares Commercial Real Estate Corporation (NYSE:ACRE) Q4 2022 Earnings Conference Call February 15, 2023 12:00 PM ET Company Participants John Stilmar - Investor Relations Bryan Donohoe - Chief Executive Officer Tae-Sik Yoon - Chief Financial Officer Conference Call Participants Steve DeLaney - JMP Securities Jade Rahmani - KBW Rick Shane - JPMorgan Stephen Laws - Raymond James Eric Hagen - BTIG John Stilmar Good afternoon, and thank you for joining us on today's conference call. I'm joined by our CEO, Bryan ...

Exhibit 99.2 0 42 65 GENER AL PALET TE 155 112 42 4 94 109 127 127 127 Credit 0 42 65 Private Equit y BUSINE SS SECTOR PALETT E 2 87 133 Real Estat e 71 126 163 Strategi c Initiat ives 120 163 198 Fourth Quarter and Full Year 2022 Earnings Presentation Disclaimer Statements included herein may constitute "forward-looking statementsˮ within the meaning of the Private Securities Litigation Reform Act of 1995 and Section 21E of the Securities Exchange Act of 1934, as amended, which may relate to future events ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 ____________________________________________________________________________ FORM 10-K ☒ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended December 31, 2022 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from _____ to _____ Commission File No. 001-35517 ____________________________________________________ ...

Financial Data and Key Metrics Changes - The company reported third quarter distributable earnings of $0.39 per share, a 5% increase from the same quarter last year, exceeding the quarterly dividends paid of $0.35 per share [5] - GAAP net income for the third quarter was $644,000 or $0.01 per share, with a significant difference attributed to a CECL provision of approximately $19.5 million [11] - The total CECL reserve increased to $51.9 million, representing about 1.9% of total loan commitments [13] Business Line Data and Key Metrics Changes - The loan portfolio consisted of 98% senior loans with an outstanding principal balance of $2.5 billion across 70 loans, with 99% of contractual interest collected [12] - Three loans were on non-accrual status, representing about 4% of the overall portfolio, with a decline in loans rated three or better from 94% to 90% [12] Market Data and Key Metrics Changes - The company noted that rising interest rates and tightening monetary policy by the Federal Reserve are creating volatility in commercial real estate markets, impacting capital formation and increasing risk premiums [6][7] - The company closed $50 million of floating rate investments in multifamily and self-storage properties during the third quarter [8] Company Strategy and Development Direction - The company is focusing on property types such as multifamily, industrial, and self-storage that exhibit strong rent growth dynamics, which have outpaced recent market interest rate increases [7] - The company plans to remain selective in new investments while maintaining a strong liquidity position amid uncertain market conditions [10][14] Management's Comments on Operating Environment and Future Outlook - Management expressed concerns about the likelihood of a recession due to the Federal Reserve's aggressive rate hikes and the resulting volatility in asset classes [6] - The company believes it is well-positioned to navigate the changing economic landscape, with a strong balance sheet and moderate leverage [17] Other Important Information - The company announced a fourth quarter 2022 regular dividend of $0.33 per common share and a supplemental quarterly dividend of $0.02 per common share [16] - The company has approximately $156 million of available capital as of November 1, which includes cash and amounts available for draw under various debt facilities [14] Q&A Session Summary Question: Inquiry about securities purchases and CLOs - Management indicated that they see compelling structural features in both CMBS and CLO markets, but have not sought to leverage these investments due to market volatility [21] Question: Discussion on office space and CECL reserves - Management acknowledged that there are cross currents in the office space, with some assets experiencing less demand while others maintain high cash flow [26] Question: Clarification on CECL reserve composition - Management confirmed that the majority of the $19.5 million increase in CECL reserves was general, with only a small portion being loan-specific [28] Question: Concerns about upcoming loan maturities - Management stated that they are actively managing loans with near-term maturities and are in close dialogue with borrowers to ensure business plans are met [31] Question: Discussion on capital allocation to AAA CMBS - Management explained that the decision to allocate capital to AAA CMBS was based on balancing risk and liquidity, given the slowdown in transaction activity [45]