Financial Data and Key Metrics Changes - The company reported net income of $0.21 per share and adjusted distributable earnings (ADE) of $0.28 per share for Q3 2024, with ADE exceeding the first quarter level of $0.27 per share [21][22] - The debt-to-equity ratio decreased to 2.5:1 at quarter end from 3.7:1 at June 30, driven by higher shareholders' equity and reduced leverage on the growing CLO investment portfolio [19][22] - The overall net interest margin increased to 5.22% from 4.24% in the prior quarter, reflecting a higher allocation of capital to the credit strategy [22][23] Business Line Data and Key Metrics Changes - The CLO strategy generated $0.12 per share of portfolio income, supported by strong net interest income and net gains from opportunistic sales [27] - The Agency strategy performed well, generating $0.18 per share of portfolio income, driven by falling interest rates and tightening agency MBS spreads [29][30] - The CLO portfolio increased to $144.5 million at September 30 from $85 million at June 30, with CLO equity comprising 52% of total CLO holdings [36] Market Data and Key Metrics Changes - The CLO market benefited from strengthening loan fundamentals and robust demand for leveraged loans, with declining default rates in both the U.S. and Europe [13][14] - Agency MBS spreads tightened, and the U.S. Agency MBS Index generated an excess return of 76 basis points for the quarter [15] - The Federal Reserve reduced the target range for the federal funds rate by 50 basis points in September, with expectations for further cuts later in 2024 [30] Company Strategy and Development Direction - The company is in the process of converting to a Delaware closed-end fund, with shareholder support for the conversion being overwhelmingly positive [9][11] - The strategic transformation aims to enhance risk-adjusted returns and provide better access to capital markets while reducing corporate income tax exposure [11][34] - The company plans to continue shifting its portfolio from Agency MBS to CLOs, with nearly 60% of capital allocated to CLOs by quarter end [36][52] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the continued ramp-up and strong performance of the CLO strategy, highlighting the active approach taken to enhance returns [55] - The company anticipates that the strategic transformation will generate superior risk-adjusted returns for shareholders [57] - Management noted that the current market conditions, including rising long-term interest rates, may impact origination volumes but could also create favorable supply-demand dynamics for Agency MBS [53] Other Important Information - The company accrued an income tax expense of $463,000 for the third quarter, resulting in an effective tax rate of about 7.8% due to the utilization of net operating losses [33][34] - The company is currently operating as a taxable C-Corp after revoking its REIT election effective January 1 of the year [32] Q&A Session Summary Question: Can you speak on the credit quality and the CLL book and how you expect that to trend over time? - Management indicated that the current trailing 12-month default rate is below 1%, with potential elevation in a high-rate environment, but overall credit quality remains stable [59][60] Question: How do you think about the dividend as you rotate more capital into CLOs? - Management stated that despite lower leverage, the increasing net interest margin supports the dividend, which remains well covered by adjusted distributable earnings [62] Question: Can you talk about your continued appetite to raise capital through the ATM? - Management confirmed that slight dilution occurred during the quarter, but raising capital at favorable prices is seen as accretive to earnings [64][65] Question: Would you expect the strong issuance trend to remain in place if pricing remains supportive? - Management expects continued strong issuance in the CLO market, driven by demand for floating-rate products and a busy pipeline ahead [67][68] Question: What does the timeline look like to move capital into new CLO equity? - Management indicated that they are prepared to act quickly to reinvest capital into new CLO equity once the shareholder vote is supportive, with a realistic target of 90 days for full rotation [70][75]

Company Performance - Ellington Credit (EARN) reported quarterly earnings of $0.28 per share, exceeding the Zacks Consensus Estimate of $0.27 per share, and up from $0.21 per share a year ago, representing an earnings surprise of 3.70% [1] - The company posted revenues of $4.75 million for the quarter ended September 2024, which missed the Zacks Consensus Estimate by 37.06%, compared to revenues of -$1.1 million a year ago [2] - Over the last four quarters, Ellington Credit has surpassed consensus EPS estimates four times but has not beaten consensus revenue estimates [2] Stock Outlook - The stock has added about 8% since the beginning of the year, underperforming the S&P 500's gain of 25.8% [3] - The current consensus EPS estimate for the coming quarter is $0.27 on revenues of $7.49 million, and for the current fiscal year, it is $1.16 on revenues of $19.88 million [7] - The estimate revisions trend for Ellington Credit is mixed, resulting in a Zacks Rank 3 (Hold), indicating expected performance in line with the market in the near future [6] Industry Context - The REIT and Equity Trust industry, to which Ellington Credit belongs, is currently in the bottom 42% of over 250 Zacks industries, suggesting potential challenges ahead [8] - Empirical research indicates a strong correlation between near-term stock movements and trends in earnings estimate revisions, which could impact investor sentiment [5]

Financial Performance - Net income for the third quarter of 2024 was $5.4 million, or $0.21 per share, with adjusted distributable earnings of $7.2 million, or $0.28 per share[2]. - Net income for the three-month period ended September 30, 2024, was $5,445,000, a significant recovery from a loss of $815,000 in the previous quarter[32]. - Adjusted Distributable Earnings were $7,241,000, slightly down from $7,273,000 in the previous quarter[40]. - The company experienced a net income (loss) before income taxes of $5,908,000, compared to a loss of $(890,000) in the previous quarter[40]. - Interest income for the three-month period ended September 30, 2024, was $12,504,000, a decrease from $14,132,000 in the previous quarter[32]. - Total net interest income for the same period was $4,752,000, compared to $3,897,000 in the prior quarter, reflecting a 22% increase[32]. - The company declared cash dividends of $0.24 per share for the three-month period, consistent with the previous quarter[32]. - The accumulated deficit increased to $146,174,000 as of September 30, 2024, from $145,196,000 in the previous quarter[33]. Asset and Liability Management - Total assets decreased to $752,303,000 as of September 30, 2024, down from $933,457,000 at the end of the previous quarter[33]. - Total liabilities decreased to $560,674,000, compared to $787,328,000 in the prior quarter, indicating a reduction of approximately 29%[34]. - The book value per share was $6.85 as of September 30, 2024, down from $6.91 in the previous quarter[33]. - Weighted average shares outstanding increased to 25,591,607 as of September 30, 2024, compared to 20,354,062 in the previous quarter[32]. Investment Strategy and Portfolio - The CLO portfolio increased by 70% to $144.5 million as of September 30, 2024, compared to $85.1 million as of June 30, 2024[10]. - The company is strategically transforming its investment focus towards corporate CLOs, emphasizing mezzanine debt and equity tranches[6]. - The company underwent a strategic transformation to focus on corporate CLOs, revoking its REIT status effective January 1, 2024[27]. - The CLO strategy yielded strong results, driven by higher net interest income and net gains in U.S. and European CLO debt portfolios[23]. Interest and Economic Returns - The net interest margin was 9.65% on credit, 3.52% on Agency, and 5.22% overall[2]. - The net interest margin (NIM) on the credit portfolio was 9.65% in Q3 2024, down from 13.41% in Q2 2024, while the NIM on the Agency portfolio increased to 3.52% from 2.85%[16]. - Overall NIM increased to 5.22% as of September 30, 2024, compared to 4.24% as of June 30, 2024, due to a higher allocation of capital to the credit strategy[16]. - The overall annualized economic return for the quarter was 10.8%[3]. Market and Economic Conditions - The trailing-twelve-month default rate for the U.S. leveraged loan index declined to 80 basis points by the end of Q3 2024, the lowest since December 2022[20]. - The U.S. Agency MBS Index generated an excess return of 0.76% in Q3 2024, supported by falling interest rates and tightening yield spreads[25]. Operational Costs - General and administrative expenses increased quarter over quarter due to costs related to the strategic transformation and higher management fees[26]. - The company incurred Strategic Transformation costs of $106,000, down from $464,000 in the previous quarter[40].

Group 1 - The recent Federal Reserve interest rate cut is expected to positively impact Real Estate Investment Trusts (REITs) [1] - REITs have been facing challenges due to high interest rates, as indicated in their official risk disclosures [1]

Financial Position - As of June 30, 2024, the company had outstanding borrowings under repurchase agreements amounting to $578.5 million, with 93% collateralized by Agency RMBS[157]. - The company's book value per share decreased to $6.91 as of June 30, 2024, down from $7.21 and $7.32 as of March 31, 2024, and December 31, 2023, respectively[157]. - The debt-to-equity ratio decreased to 3.7:1 as of June 30, 2024, compared to 4.9:1 as of March 31, 2024, driven by higher shareholder's equity and less leverage on CLO investments[167]. - The size of the Agency RMBS holdings decreased by 28% to $531.1 million as of June 30, 2024, from $739.3 million as of March 31, 2024[166]. - The net mortgage assets-to-equity ratio declined during the quarter, reflecting an increase in shareholders' equity and a smaller Agency RMBS portfolio[176]. - The debt-to-equity ratio improved to 4.0:1 as of June 30, 2024, down from 4.8:1 as of March 31, 2024, due to higher shareholders' equity and reduced leverage on CLO investments[186]. - The fair value of collateral transferred with respect to outstanding repo borrowings was $0.6 billion as of June 30, 2024, down from $0.8 billion as of December 31, 2023[206]. - The average remaining days to maturity for borrowings outstanding was 32 days as of June 30, 2024, compared to 16 days for the previous period[206]. - As of June 30, 2024, total borrowings outstanding under repurchase agreements amounted to $578.5 million, with a weighted average interest rate of 5.54%[206]. - The weighted average contractual haircut applicable to the assets serving as collateral for outstanding repo borrowings increased to 7.4% as of June 30, 2024, from 5.7% as of December 31, 2023[248]. Market Conditions - The Federal Reserve maintained its target range for the federal funds rate at 5.25%–5.50% during its April/May and June 2024 meetings, with only one interest rate cut projected by the end of 2024[158]. - The yield on the 2-year U.S. Treasury increased by 13 basis points quarter over quarter to 4.75%, while the yield on the 10-year U.S. Treasury increased by 20 basis points to 4.40%[159]. - The Freddie Mac survey indicated that the 30-year mortgage rate increased from 6.79% at the end of March to 7.22% on May 2, before declining to 6.86% at June 27[159]. - Overall prepayment speeds remained low, with Fannie Mae 30-year RMBS registering CPRs of 6.0 in April, 6.6 in May, and 6.0 in June[160]. - The unemployment rate increased to 4.1% in June 2024, up from 3.9% in April and 4.0% in May[1]. - The 12-month percentage change in the Consumer Price Index (CPI-U) registered 3.0% in June 2024, down from 3.4% in April[1]. - The NASDAQ rose by 8.3% and the S&P 500 increased by 3.9% in the second quarter, both indices setting record highs during the quarter[1]. Strategic Changes - The company approved a strategic transformation to focus on corporate collateralized loan obligations (CLOs) and revoked its REIT election for tax year 2024[149]. - The company plans to convert to a closed-end fund to be treated as a regulated investment company (RIC), subject to shareholder approval[151]. - The company operates as a taxable C-Corp after revoking its REIT election for tax year 2024[194]. - The company may face unrecorded tax liabilities if tax regulators challenge its positions on certain tax issues[194]. Income and Expenses - Net income for the three-month period ended June 30, 2024, was $(0.8) million, a decline from $1.2 million for the same period in 2023, attributed to total other loss and increased expenses[210]. - Interest income for the three-month period ended June 30, 2024, was $14.1 million, compared to $10.1 million for the same period in 2023, driven by higher asset yields[211]. - Total interest expense for the three-month periods ended June 30, 2024, and 2023 was $10.2 million and $11.7 million, respectively, reflecting a decrease due to lower overall borrowings[214]. - Other income (loss) for the three-month period ended June 30, 2024, was $(2.6) million, primarily due to net realized and unrealized losses on securities[222]. - Management fee expense increased to approximately $0.6 million for the three-month period ended June 30, 2024, compared to $0.4 million for the same period in 2023, attributed to a larger capital base[220]. - Other operating expenses rose to approximately $1.6 million for the three-month period ended June 30, 2024, from $1.1 million in the same period in 2023, mainly due to increased professional fees and compensation[221]. - Net income for the six-month period ended June 30, 2024, was $3.1 million, a slight decrease from $3.5 million for the same period in 2023[225]. - Other income for the six-month period ended June 30, 2024, was $3.0 million, driven by net realized and unrealized gains of $17.9 million on financial derivatives, partially offset by losses of $(14.9) million on securities[237]. Portfolio Performance - The weighted average yield of the overall portfolio was 6.55% for the three-month period ended June 30, 2024, compared to 3.95% for the same period in 2023[211]. - The net interest margin for the three-month period ended June 30, 2024, was 4.24%, compared to 1.08% for the same period in 2023, reflecting improved portfolio yields[219]. - The weighted average yield on the Agency RMBS and credit portfolios for the three-month period ended June 30, 2024, was 6.55%, compared to 3.95% for the same period in 2023[219]. - The weighted average yield on the Agency RMBS and credit portfolios for the six-month period ended June 30, 2024, was 5.87%, compared to 3.81% for the same period in 2023[234]. Cash Flow and Liquidity - The company expects its liquidity sources, including cash flow from investments and borrowings, to be sufficient to meet both short-term and long-term liquidity needs[245]. - For the six-month period ended June 30, 2024, operating activities provided net cash of $1.5 million, while investing activities provided net cash of $144.1 million, resulting in a total net cash of $73.4 million after financing activities[257]. - Cash and cash equivalents increased by $80.2 million, from $38.5 million as of December 31, 2023, to $118.8 million as of June 30, 2024[257]. - The company had cash and cash equivalents of $118.8 million as of June 30, 2024, which included $89.9 million of U.S. Treasury Bills held on margin[253]. - The company anticipates that its capital resources will be sufficient to meet both short-term and long-term liquidity requirements[263]. Shareholder Activities - The Board of Trustees declared a monthly dividend of $0.08 per share, with a total dividend amount of $1,691,000 for the period ending June 30, 2024[254]. - The company issued 2,533,512 common shares during the six-month period ended June 30, 2024, generating net proceeds of $16.4 million after commissions and offering costs[261]. - The company has repurchased 474,192 common shares at an average price of $9.21, with an aggregate cost of $4.4 million, and has authorization to repurchase an additional 725,808 common shares[262]. - The weighted average shares outstanding increased to 20,354,062 for the three-month period ended June 30, 2024, compared to 13,935,821 for the same period in 2023, reflecting a growth of 46.1%[244].

Financial Data and Key Metrics Changes - The company reported a net loss of $0.04 per share for Q2 2024, with adjusted distributable earnings (ADE) of $0.36 per share, reflecting a sequential increase of $0.09 per share [13][14] - The net interest margin expanded to 4.24% from 3.03% quarter-over-quarter, driven by the growth of CLOs [12][14] - The debt to equity ratio decreased to 3.7 times as of June 30, compared to 4.9 times at March 31 [19] Business Line Data and Key Metrics Changes - The CLO portfolio increased to approximately $108 million as of August 9, 2024, up from $85 million at June 30 [19] - The agency MBS portfolio decreased significantly from $791 million last September to $531 million at June 30, and further to $518 million by August 9 [7][19] - The capital allocation to CLOs increased to 45% at June 30 from 25% at March 31 [19] Market Data and Key Metrics Changes - The CLO market benefited from strengthening fundamentals and robust demand for leveraged loans, with corporate loan prepayment rates reaching their highest level since February 2022 [8][9] - Credit spreads on BB and B CLO tranches tightened overall, although there was significant dispersion among deals [9][10] - The U.S. MBS Index generated a slightly negative excess return relative to U.S. treasuries, reflecting the impact of intra-quarter interest rate volatility [11][16] Company Strategy and Development Direction - The company is in the process of transforming into a CLO-focused closed-end fund, with a targeted conversion date later this year [6][7] - The anticipated benefits of this transformation include better projected risk-adjusted returns and enhanced access to capital markets [7] - The company plans to maintain a core portfolio of liquid agency MBS until the conversion is complete, while continuing to grow its CLO portfolio [8][19] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in maintaining the dividend through the conversion to a CLO-focused fund, citing the positive impact of the rotation into CLOs on net interest margin and ADE [37] - The recent market volatility is seen as an opportunity for attractive trading, with management prepared to deploy capital at favorable spreads [25][29] - The company expects to continue to see strong returns from both CLO and agency MBS portfolios, with a favorable backdrop for agency MBS due to a steeper yield curve and potential rate cuts [29][32] Other Important Information - The company revoked its REIT election effective January 1, 2024, and is currently operating as a taxable C-Corp [17] - Book value per share was reported at $6.91 at June 30, down from $7.21 at March 31, with an economic return of negative 0.8% for the quarter [18] Q&A Session Summary Question: What is driving the dispersion in CLO performance? - Management noted that dispersion is influenced by asset quality and credit sensitivity, with equity being more exposed to tail risks [34] Question: Can you provide an update on liquidity and leverage? - As of July 31, the debt to equity ratio was down to around 3 times, indicating improved leverage [35] Question: How is the dividend outlook as capital rotates into CLOs? - Management indicated confidence in maintaining the dividend, with expectations for potential increases post-conversion based on CLO returns [37][41]

Ellington Financial Q2 2024 EARNINGS Earnings Conference Call August 7, 2024 Q2 2024 Important Notice Forward-Looking Statements This presentation contains forward-looking statements within the meaning of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements involve numerous risks and uncertainties. Our actual results may differ from our beliefs, expectations, estimates, and projections and, consequently, you should not rely on these forward-looking s ...

Ellington Credit (EARN) came out with quarterly earnings of $0.36 per share, beating the Zacks Consensus Estimate of $0.24 per share. This compares to earnings of $0.17 per share a year ago. These figures are adjusted for non-recurring items. This quarterly report represents an earnings surprise of 50%. A quarter ago, it was expected that this residential mortgage real estate investment trust would post earnings of $0.24 per share when it actually produced earnings of $0.27, delivering a surprise of 12.50%. ...

[Ellington Credit Company Q2 2024 Earnings Report](index=1&type=section&id=Ellington%20Credit%20Company%20Q2%202024%20Earnings%20Report) [Highlights](index=1&type=section&id=Highlights) The company reported a Q2 net loss of $0.8 million but generated positive Adjusted Distributable Earnings of $7.3 million while accelerating its strategic shift to CLOs Q2 2024 Key Financial Metrics | Metric | Value | | :--- | :--- | | Net Income (Loss) | $(0.8) million | | Net Income (Loss) per Share | $(0.04) | | Adjusted Distributable Earnings | $7.3 million | | Adjusted Distributable Earnings per Share | $0.36 | | Book Value per Share (June 30, 2024) | $6.91 | | Quarterly Dividends per Share | $0.24 | | Net Mortgage Assets-to-Equity Ratio | 4.0:1 | | Debt-to-Equity Ratio | 4.0:1 | - The company significantly increased its focus on corporate CLOs, with the portfolio size growing from **$45.1 million in Q1 to $85.1 million in Q2 2024**[2](index=2&type=chunk) - Capital allocation to corporate CLOs rose to **45%** as of June 30, 2024, up from 25% at the end of the previous quarter[2](index=2&type=chunk) [Strategic Transformation Update](index=1&type=section&id=Strategic%20Transformation%20Update) The company is shifting its focus to corporate CLOs, revoking its REIT status, and planning a conversion to a closed-end fund and RIC - On March 29, 2024, the Board approved a strategic transformation to focus on corporate CLOs, particularly **mezzanine debt and equity tranches**[3](index=3&type=chunk) - The company revoked its REIT election effective January 1, 2024, and intends to convert to a **closed-end fund** and be treated as a **regulated investment company (RIC)**[3](index=3&type=chunk)[4](index=4&type=chunk) - The CLO portfolio grew from $45.1 million at the end of Q1 to $85.1 million at the end of Q2, and further to **$108 million by August 9, 2024**, representing about **50% of capital allocation**[5](index=5&type=chunk)[6](index=6&type=chunk) [Second Quarter 2024 Results](index=2&type=section&id=Second%20Quarter%202024%20Results) A growing CLO portfolio drove Adjusted Distributable Earnings, while a modest loss in the MBS portfolio resulted in a slight overall net loss - The CLO portfolio generated positive net income and contributed significantly to adjusted distributable earnings, which **comfortably covered the dividend**[6](index=6&type=chunk) - The MBS portfolio generated a modest net loss due to intra-quarter interest rate and spread volatility, leading to an **overall slight net loss** for the company[7](index=7&type=chunk) - The CEO expects Q3 adjusted distributable earnings to decline from Q2's $0.36 per share level but remain above Q1's $0.27 per share, as the company terminates interest rate swaps associated with selling Agency MBS[8](index=8&type=chunk)[13](index=13&type=chunk) [Financial Results and Portfolio Composition](index=2&type=section&id=Financial%20Results%20and%20Portfolio%20Composition) The portfolio shifted towards CLOs, which grew 55%, while the Agency portfolio decreased by 28%, leading to reduced overall leverage Portfolio Composition (Fair Value, $ in thousands) | Portfolio | June 30, 2024 | March 31, 2024 | Change | | :--- | :--- | :--- | :--- | | Total Credit | $102,911 | $66,280 | +55.3% | | - CLOs | $85,088 | $45,088 | +88.7% | | Total Agency | $533,457 | $745,762 | -28.5% | | **Total Investments** | **$636,368** | **$812,042** | **-21.6%** | - The CLO portfolio consists of **$45.1 million in mezzanine debt notes** and **$40.0 million in equity tranches** as of June 30, 2024[10](index=10&type=chunk) - The debt-to-equity ratio, adjusted for unsettled trades, decreased to **3.7:1 from 4.9:1** in the prior quarter, driven by higher equity and lower leverage on the growing CLO portfolio[11](index=11&type=chunk) [Performance by Asset Class](index=4&type=section&id=Performance%20by%20Asset%20Class) The Credit portfolio generated a $1.8 million profit driven by CLOs, while the Agency RMBS portfolio recorded a $0.9 million net loss Profit (Loss) by Strategy ($ in thousands) | Strategy | Q2 2024 | Q1 2024 | | :--- | :--- | :--- | | Total Credit | $1,768 | $3,499 | | - CLOs | $1,046 | $2,250 | | - Non-Agency RMBS | $722 | $1,249 | | Total Agency RMBS | $(935) | $2,027 | - The CLO strategy had positive performance led by strong interest income and net gains on mezzanine positions, partially offset by **mark-to-market losses on certain CLO equity positions** due to rapid loan prepayments[18](index=18&type=chunk) - The Agency portfolio generated a small net loss as losses on Agency RMBS **exceeded gains on interest rate hedges**, against a backdrop of a negative excess return for the U.S. Agency MBS Index[20](index=20&type=chunk) [General and Administrative Expenses](index=5&type=section&id=General%20and%20Administrative%20Expenses) General and administrative expenses increased quarter-over-quarter due to higher professional fees and compensation related to the strategic transformation - General and administrative expenses were higher quarter over quarter due to **increased professional fees and compensation expense** related to the strategic transformation[20](index=20&type=chunk) [Financial Statements](index=7&type=section&id=Financial%20Statements) The company reported a Q2 net loss of $0.8 million, with total assets decreasing to $933.5 million and book value per share declining to $6.91 [Consolidated Statement of Operations](index=7&type=section&id=Consolidated%20Statement%20of%20Operations) For Q2 2024, the company reported total net interest income of $3.9 million and a net loss of $815,000, or $(0.04) per share Q2 2024 Statement of Operations Highlights ($ in thousands) | Line Item | Q2 2024 | Q1 2024 | | :--- | :--- | :--- | | Total Net Interest Income | $3,897 | $279 | | Total Expenses | $2,164 | $1,627 | | Total Other Income (Loss) | $(2,623) | $5,612 | | **Net Income (Loss)** | **$(815)** | **$3,961** | | **Net Income (Loss) Per Share** | **$(0.04)** | **$0.20** | [Consolidated Balance Sheet](index=8&type=section&id=Consolidated%20Balance%20Sheet) As of June 30, 2024, total assets were $933.5 million, total liabilities were $787.3 million, and shareholders' equity was $146.1 million Balance Sheet Summary ($ in thousands) | Account | June 30, 2024 | March 31, 2024 | | :--- | :--- | :--- | | Cash and cash equivalents | $118,763 | $22,442 | | Securities, at fair value | $636,368 | $812,042 | | **Total Assets** | **$933,457** | **$963,956** | | Repurchase agreements | $578,503 | $683,171 | | **Total Liabilities** | **$787,328** | **$821,039** | | **Total Shareholders' Equity** | **$146,129** | **$142,917** | | **Book Value Per Share** | **$6.91** | **$7.21** | [Reconciliation of Adjusted Distributable Earnings to Net Income (Loss)](index=9&type=section&id=Reconciliation%20of%20Adjusted%20Distributable%20Earnings%20to%20Net%20Income%20(Loss)) The company reconciled a GAAP net loss of $0.8 million to non-GAAP Adjusted Distributable Earnings of $7.3 million, or $0.36 per share - Adjusted Distributable Earnings is a non-GAAP measure calculated by adjusting net income for unrealized gains/losses, certain non-recurring items, and other adjustments to better reflect **long-term performance and dividend-paying ability**[30](index=30&type=chunk)[31](index=31&type=chunk) Adjusted Distributable Earnings Reconciliation ($ in thousands) | Line Item | Q2 2024 | Q1 2024 | | :--- | :--- | :--- | | Net Income (Loss) | $(815) | $3,961 | | Total Adjustments | $8,088 | $1,351 | | **Adjusted Distributable Earnings** | **$7,273** | **$5,312** |

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