Financial Data and Key Metrics Changes - For Q2 2025, the company generated distributable earnings of $0.15 per basic weighted average share of common stock and declared a second quarter dividend of $0.15 per share [5][6][18] - The company reported a GAAP net loss of $13.2 million, or a loss of $0.60 per basic weighted average common share [18] - As of June 30, 2025, total assets were $290.6 million, total shareholder equity was $184.7 million, and book value per share was $8.18 [19] Business Line Data and Key Metrics Changes - The company exited an equipment loan to a Nevada cultivator, impacting earnings but not book value as the loan was fully reserved [6][7] - The weighted average portfolio yield to maturity was approximately 17% as of August 1, 2025 [19] - The CECL reserve was $44 million, approximately 14.6% of loans at carrying value, with total unrealized losses of $21.5 million for loans held at fair value [19] Market Data and Key Metrics Changes - The cannabis industry remains challenging with limited capital entering the market, impacting the company's ability to invest in size [12] - The company noted that about two-thirds of cannabis opportunities do not have real estate coverage, limiting the current investment pipeline [28] Company Strategy and Development Direction - The company announced its intention to convert from a REIT to a BDC, which would allow it to invest in a broader array of opportunities, including non-real estate covered assets [13][14] - The conversion is seen as a positive step to capitalize on the cannabis sector's growth potential, especially if federal rescheduling occurs [14][16] Management's Comments on Operating Environment and Future Outlook - Management highlighted the ongoing uncertainty and volatility in the cannabis industry, which has tightened underwriting standards and reduced the investment pipeline [29] - The potential rescheduling of cannabis is expected to attract more capital into the industry, improving asset valuations and supporting the company's troubled loans [31][32] Other Important Information - The company expanded its senior secured revolving credit facility from $30 million to $50 million [19] - The proposed conversion to a BDC is subject to shareholder approval and is anticipated to occur in 2026 [16][17] Q&A Session Summary Question: Why convert to BDC versus mortgage REIT? - Management explained that many thriving cannabis operators do not own real estate, limiting investment opportunities as a REIT. The conversion to a BDC is seen as the best path for long-term value [22][24] Question: How much will the BDC conversion broaden the pipeline? - Management indicated that approximately two-thirds of cannabis opportunities do not have real estate coverage, suggesting significant potential for pipeline expansion post-conversion [28] Question: Update on problem loans with Private Company A and K? - Management provided updates on asset sales under receivership for Private Company A and clarified the accounting treatment for loans held at fair value versus carrying value [37][39] Question: What is the target debt leverage ratio? - The company targets a leverage ratio between 1.0 and 1.2 times and does not foresee issuing equity given current stock trading levels [41][42] Question: Market sentiment on mortgage REIT sector? - Management noted that mortgage REITs have traded better recently, with interest rates impacting trading and investment opportunities [45] Question: Impact of rescheduling on borrower interest? - Management stated that the rescheduling conversation is still new, and many are in a holding pattern awaiting concrete developments [49][50] Question: CECL reserves increase due to portfolio fundamentals or macro aspects? - Management indicated that while macro factors play a role, the increase in CECL reserves is primarily driven by individual loan evaluations [51][52] Question: Will BDC conversion open new credit facilities? - Management noted that while the current credit line is similar to BDC financing, it is uncertain if the structure will attract more banks to participate in cannabis lending [54][55]

Company Overview - Advanced Flower Capital (AFCG) aims to provide attractive risk-adjusted returns through investments with significant collateral, targeting an average portfolio gross yield of 12%-20%[14,15] - The company's management and investment team have collectively structured over $15 billion in loan transactions and taken four companies public[14,54] - AFC's loan portfolio includes 15 loans to borrowers with operations and/or collateral across 16 states[22] Market Opportunity - The U S legal cannabis market is expected to reach $63 billion by 2030, with a total economic impact surpassing $200 billion[28] - Cannabis growth is expected to continue, potentially cutting into alcohol purchases, with alcohol sales in legal cannabis states underperforming by 1-1 5% over the past 5 years[33] - Cannabis is a $35 billion legal market projected to grow to $63 billion by 2030[37] Financial Performance & Portfolio - The company's total commitments since inception are $917 million[58] - The outstanding principal balance is $358 million, with current commitments of $370 million[25,58] - Deal selectivity is 3 9%, representing the ratio of closed deals to deals sourced/reviewed since January 1, 2020[58] - The weighted average yield-to-maturity (YTM) of the portfolio loans is approximately 17% as of August 1, 2025[49,64]

AFC Gamma Inc. (AFCG) came out with quarterly earnings of $0.15 per share, missing the Zacks Consensus Estimate of $0.24 per share. This compares to earnings of $0.56 per share a year ago. These figures are adjusted for non-recurring items.This quarterly report represents an earnings surprise of -37.50%. A quarter ago, it was expected that this company would post earnings of $0.25 per share when it actually produced earnings of $0.21, delivering a surprise of -16%.Over the last four quarters, the company ha ...

Advanced Flower Capital Inc. Announces Financial Results for the Second Quarter 2025 Second quarter 2025 GAAP net loss of $(13.2) million or $(0.60) per basic weighted average common share and Distributable Earnings of $3.4 million or $0.15 per basic weighted average common share (1) Announces Intention to Convert from Mortgage REIT to BDC WEST PALM BEACH, FL, August 14, 2025 – Advanced Flower Capital Inc. (Nasdaq: AFCG) ("Advanced Flower Capital", "AFC" or the "Company") today announced its results for the ...

Second quarter 2025 GAAP net loss of $(13.2) million or $(0.60) per basic weighted average common share and Distributable Earnings(1) of $3.4 million or $0.15 per basic weighted average common share Announces Intention to Convert from Mortgage REIT to BDC WEST PALM BEACH, Fla., Aug. 14, 2025 (GLOBE NEWSWIRE) -- Advanced Flower Capital Inc. (Nasdaq: AFCG) (“Advanced Flower Capital”, “AFC” or the “Company”) today announced its results for the quarter ended June 30, 2025. AFC reported generally accepted accoun ...

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, 2025 ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from __________ to __________ Commission File Number: 001-39995 ADVANCED FLOWER CAPITAL INC. (Exact name of registrant as specified in its charter) Maryland 85-1807125 (State or ...

Company Overview - Advanced Flower Capital Inc. (AFC) is a leading commercial mortgage REIT that provides institutional loans to state law compliant cannabis operators in the U.S. [3] - The company originates, structures, and underwrites loans ranging from $10 million to over $100 million, typically secured by quality real estate assets, license value, and cash flows [3]. - AFC is based in West Palm Beach, Florida [3]. Financial Results Announcement - AFC will release its financial results for the second quarter ending June 30, 2025, on Thursday, August 14, 2025, before market open [1]. - Management will review the financial results at 10:00 am ET via a webcast available on the Investor Relations section of AFC's website [1]. - A replay of the event will be available one hour after the live presentation [1]. Investor Relations - AFC distributes its earnings releases via its website and email lists, and interested parties can sign up for updates [2]. - The Investor Relations contact for AFC is Robyn Tannenbaum, who can be reached at 561-510-2293 or via email [4]. - Media inquiries can be directed to Collected Strategies, with contacts Jim Golden and Jack Kelleher available [4].

Core Points - Advanced Flower Capital Inc. declared a quarterly dividend of $0.15 per share for the quarter ending June 30, 2025, payable on July 15, 2025 [1] - The second quarter dividend was affected by a realized loss related to a loan to Public Company A [2] Company Overview - Advanced Flower Capital Inc. is a commercial mortgage real estate investment trust (REIT) that provides loans to state law compliant cannabis operators in the U.S., with loans ranging from $10 million to over $100 million [3] - The company is based in West Palm Beach, Florida, and leverages a deep network and significant expertise in credit and cannabis to manage its loan portfolio [3] Financial Metrics - The company uses "Distributable Earnings" as a non-GAAP financial measure to evaluate performance, which excludes certain transactions and GAAP adjustments [4][6] - Distributable Earnings is defined as net income excluding stock-based compensation, depreciation, unrealized gains/losses, and other non-cash items [6] - The determination of Distributable Earnings is similar to Core Earnings but includes Incentive Compensation earned during the period [5] Dividend Policy - As a REIT, the company is required to distribute at least 90% of its annual taxable income, which influences its dividend payments [7] - Distributable Earnings is one of the factors considered by the Board of Directors when authorizing dividends, although it is not a direct measure of net taxable income [8]

Core Insights - Advanced Flower Capital Inc. (AFC) has expanded its senior secured revolving credit facility to $50 million, with an additional $20 million commitment from its Lead Arranger, an FDIC-insured bank with over $75 billion in assets [1][2] - The funds from the credit facility will be used to support existing borrowers, originate and participate in commercial loans to cannabis operators, and for general corporate purposes [1] - The credit facility has the potential to be expanded to $100 million, depending on lender participation and available borrowing base [1] Company Overview - Advanced Flower Capital Inc. is a leading commercial mortgage REIT that provides institutional loans to state law compliant cannabis operators in the U.S. [3] - The company specializes in originating, structuring, and underwriting loans ranging from $10 million to over $100 million, typically secured by quality real estate assets, license value, and cash flows [3] - AFC is based in West Palm Beach, Florida, and leverages a deep network and significant expertise in credit and cannabis to execute its investment strategy [3]

Core Viewpoint - The article emphasizes the importance of quantitative methods in identifying undervalued stocks across various industries, suggesting that numerical data often provides a clearer picture of a company's potential than narrative descriptions [1]. Group 1: Investment Strategy - The company employs quantitative methods that have been backtested for success to search for undervalued stocks of any size [1]. - The belief is that numbers are more significant than stories in most cases, as they tend to reflect a more realistic outlook on a company's prospects [1]. Group 2: Experience and Knowledge - The company has been investing since 2013 and has gained knowledge through extensive reading of stock market literature [1]. - Notable books that have influenced the company's investment approach include "100 Baggers," "Financial Shenanigans," and "The Quants" [1].