Apollo Commercial Real Estate Finance, Inc. (NYSE:ARI) Q3 2020 Results Conference Call October 27, 2020 10:30 AM ET Company Participants Stuart Rothstein - CEO Jai Agarwal - CFO Scott Weiner - Chief Investment Officer Conference Call Participants Doug Harter - Credit Suisse Steve Delaney - JMP Securities Jade Rahmani - KBW Charlie Arestia - JPMorgan Operator I’d like to remind everyone that today’s call and webcast are being recorded. Please note that they are the property of Apollo Commercial Real Estate F ...

Financial Performance - Operating Earnings were $036 per diluted share of common stock[7,8] - Net income available to common stockholders was $460 million, or $031 per diluted share[8] - A common stock dividend of $035 per share was declared for Q3 2020, representing a 97% payout ratio[8] Capitalization and Liquidity - The company repurchased 50 million shares of common stock for $455 million at a weighted average price of $901 per share during Q3 2020[8] - Year-to-date, the company repurchased 138 million shares for $1192 million at a weighted average price of $860 per share[8] - The company ended the quarter with $438 million in cash and $12 million of approved and undrawn credit capacity[8] Loan Portfolio - The total loan portfolio was $64 billion with a weighted average unlevered all-in yield of 62%[7,8] - 84% of the portfolio consists of first mortgage loans[7] - 95% of loans have floating interest rates, and 90% of US floating-rate loans have in-the-money LIBOR floors with a weighted average of 148%[8] Capital Structure - Secured debt obligations totaled $3478 billion, representing 50% of the book value capitalization[16] - Common equity book value was $2192 billion, or 32% of the book value capitalization[17]

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 __________________________________ Emerging growth company ☐ FORM 10-Q __________________________________ (Mark One) ☒ Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 For the quarterly period ended September 30, 2020 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 Number: 001-34452 _____________________ ...

Financial Data and Key Metrics Changes - For Q2 2020, operating earnings excluding realized losses were $59 million, equating to $0.38 per share, while GAAP net income available to common stockholders was $56.8 million or $0.36 per share [14] - The realized losses included losses from the sale of three construction loans and the unwinding of a $500 million notional interest rate swap, which is expected to save approximately $10 million in annual interest expense [14] - GAAP book value per share increased to $15.12 from $14.94 at the end of Q1 2020, primarily due to accretive share repurchases [15] Business Line Data and Key Metrics Changes - The company ended the quarter with 71 loans totaling approximately $6.4 billion in amortized cost, with a weighted average unlevered yield of 6.7% and a fully extended term of just over three years [9][15] - ARI received 99.8% of the expected interest from outstanding loans, with hospitality and retail assets being the most impacted by the pandemic [9] Market Data and Key Metrics Changes - The company maintained over $518 million in cash and undrawn credit capacity at the end of the quarter, with over $1 billion in unencumbered loan assets [7][15] - Deal activity is slowly returning, with ARI benefiting from being part of the broader commercial real estate debt platform at Apollo [11] Company Strategy and Development Direction - The company is focused on maintaining excess liquidity and a cautious approach to new investment opportunities, while also exploring both additions to the portfolio and the use of capital within the existing capital structure [12] - ARI has proactively sold certain loans to generate liquidity and eliminate over $250 million of future funding obligations [7][10] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in navigating the ongoing market volatility and uncertainty, citing strong borrower and lender relationships [13] - The company is maintaining a defensive bias and is focused on keeping elevated cash levels on the balance sheet [21] Other Important Information - The company has successfully negotiated a six-month holiday for evaluation requirements with its secured credit facility counterparties [8][55] - Construction has resumed across all ARI's construction loans, with delays not being a primary concern [52] Q&A Session Summary Question: Comments on buyback activity and cash allocation - Management acknowledged the importance of cash and indicated a focus on maintaining elevated cash levels on the balance sheet [19][21] Question: Overall cost of capital for the mortgage REIT business - Management estimated a low double-digit weighted average cost of capital across the sector [28] Question: Sustainability of the current dividend - Management indicated that the current dividend is covered with a 92% payout ratio and will be reviewed in September [32][33] Question: Future funding commitments and cash coverage - Management provided details on future funding commitments, indicating that some are dependent on specific hurdles [39] Question: Transaction activity and structures - Management noted that while transaction activity is slow, they are looking at regular business with good sponsors [44] Question: Construction site operations and timelines - Management stated that construction sites are generally operating at full capacity with minor delays [52] Question: Status of specific loans and projects - Management provided updates on the status of loans and projects, indicating ongoing discussions with potential buyers [60][62]

Financial Performance - For the three months ended June 30, 2020, net income available to common stockholders was $56.8 million, or $0.36 per diluted share[166]. - For the six months ended June 30, 2020, net income (loss) available to common stockholders was $(74.4) million, or $(0.50) per diluted share[166]. - The company reported a net loss of $74.4 million for the six months ended June 30, 2020, compared to a net income of $117.4 million for the same period in 2019[166]. - Operating Earnings were $(11.3) million, or $(0.07) per share, compared to $56.6 million, or $0.38 per share for the same period in the prior year[230]. - Operating earnings for the six months ended June 30, 2020, were $(11,250), a decrease from $51,438 for the same period in 2019[239]. - Net interest income decreased by $14.2 million (16.7%) and $22.4 million (13.4%) for the three and six months ended June 30, 2020, respectively, compared to the same periods in 2019[169]. - The company recognized a realized loss of $53.9 million from the termination of an interest rate swap during the second quarter of 2020[179]. - The company recorded a net realized loss on the sale of three construction loans and one hotel loan due to troubled debt restructuring[235]. Debt and Financing - The company's commercial mortgage loans net amounted to $5,343.4 million with a weighted average coupon of 4.8% and a weighted average all-in yield of 5.3% as of June 30, 2020[159]. - The total commercial real estate debt portfolio was valued at $6,387.8 million, with subordinate loans and other lending assets net at $1,044.4 million[159]. - The secured debt arrangements totaled $3,440.2 million, with a cost of funds at 2.2%[159]. - As of June 30, 2020, the company had $1.1 billion of corporate debt and $3.4 billion of asset-specific financings, with no corporate debt maturities until August 2022[183]. - The debt-to-equity ratio increased to 1.7 as of June 30, 2020, compared to 1.4 as of December 31, 2019[184]. - The company had $583.8 million in loans on cost recovery or non-accrual status as of June 30, 2020, compared to $199.1 million at the same date in 2019[169]. - The company had $1.5 billion of unfunded loan commitments as of June 30, 2020, primarily related to its commercial mortgage loan portfolio[221]. - The senior secured term loan outstanding balance was $495.0 million as of June 30, 2020, maturing in May 2026[207]. Management and Operations - The company is externally managed by Apollo, which has approximately $413.6 billion in assets under management as of June 30, 2020[153]. - The Management Agreement allows the Manager to receive a base management fee of 1.5% of stockholders' equity per annum, calculated quarterly[222]. - The Management Agreement may be terminated only upon a two-thirds vote of independent directors based on unsatisfactory performance or unfair management fees[224]. - The company does not have any off-balance sheet arrangements or relationships with unconsolidated entities[225]. Market Conditions and Risks - The ongoing COVID-19 pandemic has adversely impacted the company's financial condition, results of operations, and cash flows, with potential for continued economic disruption[156]. - The company has adopted the CECL Standard, which may affect its accounting policies[157]. - The company aims to manage interest rate risk through various financing structures and hedging instruments[246]. - The total floating rate assets subject to interest rate sensitivity amounted to $1,628,001 as of June 30, 2020[247]. Shareholder Information - The company repurchased 5,795,976 shares of common stock at a weighted-average price of $7.96 per share during the six months ended June 30, 2020[211]. - The company intends to continue making regular quarterly distributions to common stockholders, aiming to distribute at least 90% of REIT taxable income[226]. - The company had 6,770,393 shares of Series B Preferred Stock outstanding, with dividends at an initial rate of 8.00% per annum, payable quarterly[227]. - Book value per share decreased to $14.81 as of June 30, 2020, down from $16.03 as of December 31, 2019[240]. Allowance and Provisions - The Specific CECL Allowance recorded a total of $155.5 million during the six months ended June 30, 2020, partially offset by a $15.0 million reversal of a previously recorded allowance[177]. - The provision for loan losses for the three months ended June 30, 2020, was $(25,169), compared to $(15,000) for the same period in 2019[239].

Apollo Commercial Real Estate Finance, Inc. (NYSE:ARI) Q1 2020 Earnings Conference Call May 8, 2020 9:00 AM ET Company Participants Stuart Rothstein - Chief Executive Officer Jai Agarwal - Chief Financial Officer Scott Weiner - Chief Investment Officer Conference Call Participants Doug Harter - Credit Suisse Rick Shane - JP Morgan Jade Ramani - KBW Stephen Laws - Raymond James Steve DeLaney - JMP Securities George Bahamondes - Deutsche Bank Operator I'd like to remind everyone that today's call and webcast ...

Financial Results - Net interest income was $747 million[7] - Net loss available to common stockholders was ($1312) million, or ($086) per diluted share[7] - Operating Earnings were $627 million, or $040 per diluted share[7] - A common stock dividend of $040 per share was declared for Q1 2020[7] Liquidity and Capitalization - Current liquidity was $582 million[7] - As of May 6, 2020, cash on hand was $567 million and approved & undrawn credit capacity was $15 million[7] - Unencumbered loan assets were $11 billion as of May 6, 2020[7] - Debt-to-equity ratio was 16x[7] Loan Portfolio - Total loan portfolio was $64 billion[7] - Weighted average unlevered all-in yield was 67%[7] - 95% of loans have floating interest rates[7] Balance Sheet and CECL Allowance - Total investments, net were $6431 million as of March 31, 2020[32] - The company recorded a Specific CECL Allowance of ($150) million and a General CECL Allowance of ($64) million[12]

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 __________________________________ FORM 10-Q __________________________________ (Mark One) ☒ Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 For the quarterly period ended March 31, 2020 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 Number: 001-34452 | --- | --- | --- | |------------------------------ ...

Apollo Commercial Real Estate Finance, Inc. (NYSE:ARI) Q4 2019 Earnings Conference Call February 14, 2020 10:00 AM ET Company Participants Stuart Rothstein - Chief Executive Officer Jai Agarwal - Chief Financial Officer Conference Call Participants Stephen Laws - Raymond James Rick Shane - JPMorgan Jade Ramani - KBW Operator Ladies and gentlemen, thank you for standing by, and welcome to the Fourth Quarter 2019 Apollo Commercial Real Estate Finance Inc. Earnings Conference Call. At this time, all participan ...