[Executive Summary & Q2 2025 Highlights](index=1&type=section&id=Executive%20Summary%20%26%20Q2%202025%20Highlights) Overview of Ladder Capital Corp's Q2 2025 financial performance and strategic achievements [Q2 2025 Financial Performance](index=1&type=section&id=Q2%202025%20Financial%20Performance) Ladder Capital Corp reported GAAP income before taxes of $20.8 million and diluted EPS of $0.14 for Q2 2025, with distributable earnings reaching $30.9 million and distributable EPS at $0.23 Q2 2025 Financial Performance Summary | Metric | Q2 2025 (Millions) | Q1 2025 (Millions) | Change (QoQ) | Change (%) | | :---------------------- | :----------------- | :----------------- | :----------- | :--------- | | GAAP Income Before Taxes| $20.8 | $10.7 | $10.1 | 94.4% | | Diluted EPS | $0.14 | $0.09 | $0.05 | 55.6% | | Distributable Earnings | $30.9 | $25.5 | $5.4 | 21.2% | | Distributable EPS | $0.23 | $0.20 | $0.03 | 15.0% | [CEO Commentary & Strategic Achievements](index=1&type=section&id=CEO%20Commentary%20%26%20Strategic%20Achievements) The CEO highlighted the achievement of investment grade status and the completion of an inaugural unsecured bond offering, positioning Ladder as the only investment grade mortgage REIT, strengthening its foundation, reducing capital costs, and enabling new investment opportunities - Achieved **investment grade status** and completed an inaugural unsecured bond offering in the investment grade market[2](index=2&type=chunk) - Positioned as the only **investment grade mortgage REIT**, anchored by a diversified, highly liquid, senior secured asset base and a predominantly unsecured capital structure[2](index=2&type=chunk) - Reduced cost of capital, enabling deployment into new investment opportunities, expansion of investor base, and delivery of attractive, risk-adjusted returns[2](index=2&type=chunk) [Company Overview](index=1&type=section&id=Company%20Overview) This section provides an overview of Ladder Capital's business, investment strategy, and corporate governance [About Ladder Capital](index=1&type=section&id=About%20Ladder%20Capital) Ladder Capital is a publicly listed, investment grade-rated commercial real estate finance company with a diversified, nationwide platform, focusing on tailored capital solutions to the middle market to preserve shareholder capital and generate attractive, risk-adjusted returns - Ladder is a publicly listed, **investment grade-rated commercial real estate finance company** with a diversified, nationwide platform[5](index=5&type=chunk) - Delivers tailored capital solutions across the commercial real estate landscape, with a focus on the **middle market**[5](index=5&type=chunk) - Investment objective is to preserve and protect shareholder capital while generating attractive, **risk-adjusted returns**[5](index=5&type=chunk) [Business Model and Investment Strategy](index=1&type=section&id=Business%20Model%20and%20Investment%20Strategy) Since its founding in 2008, Ladder has deployed over $48 billion of capital, primarily originating fixed and floating rate first mortgage loans collateralized by commercial property types, and also owns net leased real estate and invests in investment grade securities - Deployed more than **$48 billion of capital** across the real estate capital stack since 2008[6](index=6&type=chunk) - Primary business is originating fixed and floating rate **first mortgage loans** collateralized by all major commercial property types[6](index=6&type=chunk) - Owns and operates predominantly net leased, income-producing real estate and invests in **investment grade securities** secured by first mortgage loans on commercial real estate[6](index=6&type=chunk) [Corporate Governance and Capital Structure](index=1&type=section&id=Corporate%20Governance%20and%20Capital%20Structure) Ladder is internally managed by a seasoned team with over 11% insider ownership, ensuring strong alignment with stakeholders, and maintains a conservative capital structure with investment grade credit ratings of Baa3 from Moody's and BBB- from Fitch, both with stable outlooks - Internally managed by a seasoned management team with over **11% insider ownership**, ensuring strong alignment with stakeholders[7](index=7&type=chunk) - Maintains a conservative and durable capital structure, reflected in **investment grade credit ratings** of Baa3 from Moody's Ratings and BBB- from Fitch Ratings, both with stable outlooks[7](index=7&type=chunk) [Corporate Information](index=1&type=section&id=Corporate%20Information) This section outlines important disclaimers regarding forward-looking statements and details for investor relations [Forward-Looking Statements](index=2&type=section&id=Forward-Looking%20Statements) This section provides a disclaimer that certain statements are forward-looking, based on management's current expectations, and involve risks and uncertainties, with actual results potentially differing materially and the company disclaiming any obligation to update these statements - Statements are based on management's current opinions, expectations, beliefs, plans, objectives, assumptions or projections regarding future events or results[9](index=9&type=chunk) - Forward-looking statements are predictions, not historical fact, and involve certain risks and uncertainties; actual results could differ materially[9](index=9&type=chunk) - Ladder expressly disclaims any obligation or undertaking to release any updates or revisions to any forward-looking statements[9](index=9&type=chunk) [Investor Relations & Conference Call](index=1&type=section&id=Investor%20Relations%20%26%20Conference%20Call) Details for investor contact and the Q2 2025 earnings conference call are provided, including dial-in information, webcast link, and replay access - **Investor Contact:** - Phone: (917) 369-3207 - Email: investor.relations@laddercapital.com[10](index=10&type=chunk) - **Q2 2025 Earnings Conference Call:** - Date: Thursday, July 24, 2025 - Time: 10:00 a.m. Eastern Time - Domestic Dial-in: (877) 407-4018 - International Dial-in: (201) 689-8471 - Webcast: ir.laddercapital.com/event - Audio replay available until August 7, 2025[4](index=4&type=chunk) [Consolidated Financial Statements](index=3&type=section&id=Consolidated%20Financial%20Statements) This section presents Ladder Capital's consolidated balance sheets and statements of income for the specified periods [Consolidated Balance Sheets](index=3&type=section&id=Consolidated%20Balance%20Sheets) The consolidated balance sheets show a decrease in total assets and liabilities from December 31, 2024, to June 30, 2025, with cash and cash equivalents significantly decreasing while securities held increased substantially Consolidated Balance Sheets Summary | Item | June 30, 2025 ($ Thousands) | December 31, 2024 ($ Thousands) | Change ($ Thousands) | Change (%) | | :------------------------------------------ | :-------------------------- | :------------------------------ | :------------------- | :--------- | | **Assets** | | | | | | Cash and cash equivalents | 134,939 | 1,323,481 | (1,188,542) | -89.8% | | Securities | 1,966,471 | 1,080,839 | 885,632 | 81.9% | | Total assets | 4,457,474 | 4,845,073 | (387,599) | -8.0% | | **Liabilities** | | | | | | Debt obligations, net | 2,783,166 | 3,135,617 | (352,451) | -11.2% | | Total liabilities | 2,957,404 | 3,312,134 | (354,730) | -10.7% | | **Equity** | | | | | | Total shareholders' equity | 1,502,616 | 1,535,030 | (32,414) | -2.1% | | Total liabilities and equity | 4,457,474 | 4,845,073 | (387,599) | -8.0% | [Consolidated Statements of Income](index=4&type=section&id=Consolidated%20Statements%20of%20Income) For the three months ended June 30, 2025, Ladder Capital reported a significant increase in income before taxes and net income attributable to Class A common shareholders compared to the previous quarter, driven by higher net interest income, real estate operating income, and increased net results from mortgage loan receivables held for sale, alongside a decrease in total costs and expenses Consolidated Statements of Income Summary | Item | Three Months Ended June 30, 2025 ($ Thousands) | Three Months Ended March 31, 2025 ($ Thousands) | Change ($ Thousands) | Change (%) | | :-------------------------------------------------- | :--------------------------------------------- | :---------------------------------------------- | :------------------- | :--------- | | Net interest income | 21,530 | 20,329 | 1,201 | 5.9% | | Real estate operating income | 25,775 | 21,773 | 4,002 | 18.4% | | Net result from mortgage loan receivables held for sale | 4,914 | 162 | 4,752 | 2933.3% | | Total other income (loss) | 34,731 | 30,874 | 3,857 | 12.5% | | Total costs and expenses | 35,481 | 40,567 | (5,086) | -12.5% | | Income (loss) before taxes | 20,822 | 10,717 | 10,105 | 94.3% | | Net income (loss) attributable to Class A common shareholders | 17,328 | 11,775 | 5,553 | 47.2% | | Diluted EPS | 0.14 | 0.09 | 0.05 | 55.6% | | Dividends per share of Class A common stock | 0.23 | 0.23 | 0 | 0.0% | [Non-GAAP Financial Measures](index=5&type=section&id=Non-GAAP%20Financial%20Measures) This section defines and reconciles non-GAAP financial measures, including distributable earnings and EPS, and outlines their limitations [Definition and Purpose](index=5&type=section&id=Definition%20and%20Purpose) Ladder Capital utilizes non-GAAP financial measures such as distributable earnings, distributable EPS, and after-tax distributable ROAE to supplement GAAP measures, aiming to provide a more relevant and consistent comparison of operating performance and dividend-paying ability by excluding certain non-cash expenses, unrealized results, and timing differences - Distributable earnings, distributable EPS, and after-tax distributable ROAE are non-GAAP financial measures used as supplemental measures of operating performance[16](index=16&type=chunk) - These measures assist investors in comparing operating performance and dividend-paying ability by excluding non-cash expenses, unrealized results, and timing differences[16](index=16&type=chunk) - Management uses these metrics to evaluate earnings, and the board of directors considers distributable earnings in determining quarterly dividends[16](index=16&type=chunk) [Adjustments to GAAP Measures](index=5&type=section&id=Adjustments%20to%20GAAP%20Measures) Distributable earnings are derived from GAAP income before taxes by applying several adjustments that primarily address non-cash items, unrealized gains/losses, and timing differences related to real estate depreciation, derivative transactions, loan sales, securities valuation, and loan loss provisions [Real Estate Depreciation, Amortization, and Sale Adjustments](index=5&type=section&id=Real%20Estate%20Depreciation%2C%20Amortization%2C%20and%20Sale%20Adjustments) This section details adjustments made for real estate depreciation, amortization, and gains/losses on sales to derive distributable earnings - Excludes the Company's share of real estate depreciation and amortization from distributable earnings[18](index=18&type=chunk) - Adjusts GAAP gains and losses on sales of real estate to eliminate the portion derived from previously recognized depreciation and amortization[18](index=18&type=chunk) [Derivative Results and Loan Sale Activity](index=5&type=section&id=Derivative%20Results%20and%20Loan%20Sale%20Activity) This section outlines adjustments for derivative activity and economic gains or losses from inter-segment conduit loan sales - Excludes GAAP results from derivative activity until the associated mortgage loan or security is sold or paid off, or the hedge position is closed, to adjust for timing differences[19](index=19&type=chunk) - Includes adjustments for economic gains or losses related to the sale of inter-segment conduit loans when risk has substantially transferred, excluding subsequent GAAP amortization of related premium/discount[20](index=20&type=chunk) [Unrealized Gains/Losses on Securities](index=6&type=section&id=Unrealized%20Gains%2FLosses%20on%20Securities) This section describes adjustments for unrealized gains and losses on securities, including realized gains/losses and non-recoverable impairments - Excludes the impact of unrealized gains and losses associated with securities recorded at fair value from distributable earnings[21](index=21&type=chunk) - Includes realized gains and losses in connection with any disposition of securities[21](index=21&type=chunk) - Declines in fair value deemed non-recoverable impairments for GAAP are included in distributable earnings in the period such determination is made[21](index=21&type=chunk) [Provision for Loan Losses and Real Estate Impairment](index=6&type=section&id=Provision%20for%20Loan%20Losses%20and%20Real%20Estate%20Impairment) This section details adjustments for unrealized and realized provisions for loan losses and real estate impairment - Includes adjustments for unrealized provision for loan losses and real estate impairment[22](index=22&type=chunk) - Recognizes realized losses on loans and real estate in distributable earnings when the asset is sold or deemed non-recoverable[22](index=22&type=chunk) [Reconciliation of Non-GAAP Measures](index=6&type=section&id=Reconciliation%20of%20Non-GAAP%20Measures) The reconciliation table details the adjustments made to GAAP income before taxes to arrive at distributable earnings and distributable EPS for the three months ended June 30, 2025, and March 31, 2025, with key adjustments including real estate depreciation, derivative results, and non-cash stock-based compensation Reconciliation of Distributable Earnings and EPS | Item | Three Months Ended June 30, 2025 ($ Thousands) | Three Months Ended March 31, 2025 ($ Thousands) | Change ($ Thousands) | Change (%) | | :---------------------------------------------------------------- | :--------------------------------------------- | :---------------------------------------------- | :------------------- | :--------- | | Income (loss) before taxes | 20,822 | 10,717 | 10,105 | 94.3% | | Our share of real estate depreciation, amortization and real estate sale adjustments | 7,755 | 4,503 | 3,252 | 72.2% | | Adjustments for derivative results and loan sale activity | (724) | (435) | (289) | 66.4% | | Non-cash stock-based compensation | 2,996 | 11,215 | (8,219) | -73.3% | | **Distributable earnings** | **30,925** | **25,452** | **5,473** | **21.5%** | | Estimated corporate tax (expense) benefit | (1,990) | (206) | (1,784) | 866.0% | | **After-tax distributable earnings** | **28,935** | **25,246** | **3,689** | **14.6%** | | Weighted average diluted shares outstanding | 126,204 | 126,280 | (76) | -0.1% | | **Distributable EPS** | **0.23** | **0.20** | **0.03** | **15.0%** | [After-Tax Distributable Return on Average Equity (ROAE)](index=7&type=section&id=After-Tax%20Distributable%20Return%20on%20Average%20Equity%20(ROAE)) The after-tax distributable ROAE for the three months ended June 30, 2025, was 7.7%, an increase from 6.6% in the prior quarter, reflecting improved after-tax distributable earnings After-Tax Distributable ROAE Calculation | Item | Three Months Ended June 30, 2025 | Three Months Ended March 31, 2025 | Change (Percentage Points) | | :---------------------------- | :------------------------------- | :-------------------------------- | :------------------------- | | After-tax distributable earnings | $28,935 | $25,246 | $3,689 | | Average shareholders' equity | $1,509,642 | $1,525,849 | ($16,207) | | After-tax distributable ROAE | 7.7 % | 6.6 % | 1.1 pp | [Limitations of Non-GAAP Measures](index=8&type=section&id=Limitations%20of%20Non-GAAP%20Measures) The company highlights several limitations of its non-GAAP financial measures, including that they do not reflect certain cash charges, are not necessarily indicative of cash needs, rely on estimated tax rates that may differ from actual rates, and may not be comparable to measures used by other companies, thus they should not be considered substitutes for GAAP measures or cash flows from operations - Non-GAAP measures do not reflect the impact of certain cash charges not indicative of ongoing operations and are not necessarily indicative of cash needed to fund cash needs[25](index=25&type=chunk)[28](index=28&type=chunk) - Based on a non-GAAP estimate of the effective tax rate, which may differ materially from the actual tax rate[28](index=28&type=chunk) - Other companies in the industry may calculate non-GAAP financial measures differently, limiting their usefulness as comparative measures[28](index=28&type=chunk) - Should not be considered in isolation or as a substitute for net income (loss) attributable to shareholders, earnings per share, book value per share, or as an alternative to cash flows from operations[25](index=25&type=chunk) - Distributable earnings should not be considered equivalent to REIT taxable income for determining minimum dividend distribution requirements[26](index=26&type=chunk)

Group 1 - The Payout Desk focuses on high-yield equities, REITs, and long-duration total return strategies, emphasizing resilient cash flows and sustainable dividend growth [2] - The research is based on fundamental analysis and informal discussions with a network of analysts and investors, ensuring a diverse perspective on investment ideas [2] - The analyst has a beneficial long position in LADR shares, indicating a personal investment conviction in the company [3] Group 2 - Seeking Alpha welcomes contributions from analysts, allowing them to share investment ideas and gain exposure to a wider audience [1] - The platform emphasizes that past performance does not guarantee future results, highlighting the importance of individual research and due diligence [4]

Group 1 - David A. Johnson is the founder and principal of Endurance Capital Management, a New Jersey Limited Liability Company, with over 30 years of investment experience [1] - The company engages in a diverse range of investments including stocks, bonds, options, ETFs, REITs, real estate, closed-end funds, hedge funds, and private credit [1] - David holds a Master of Science (MS) Degree in Finance with a concentration in Investment Analysis from Boston University, a Certificate in Financial Planning, and an MBA from Fordham University [1]

Group 1 - Mortgage REITs have a long history, gaining popularity in the late 1960s and early 1970s as large banks and mortgage brokers established their own [1] - The iREIT® Tracker provides comprehensive data on over 250 tickers, including quality scores, buy targets, and trim targets, aimed at enhancing investment research [1] - The introduction of the iREIT Buy Zone Ratings Tracker allows members to screen for value, enhancing investment decision-making [2] Group 2 - A promotional offer includes a 2-week free trial and a complimentary book, aimed at attracting new members to the iREIT® platform [4]

Core Insights - Ladder Capital (NYSE: LADR) reported weaker-than-expected earnings for the first fiscal quarter, indicating a decline in net interest income as the company aims to reduce its balance sheet and portfolio [1] Financial Performance - The earnings report highlighted a drop in net interest income, reflecting the company's strategic decision to shrink its balance sheet [1]

Loan Origination and Portfolio - Ladder Capital has originated $30.3 billion of commercial real estate loans since its inception in October 2008 through March 31, 2025[220]. - The company has acquired $14.6 billion of predominantly investment grade-rated securities secured by first mortgage loans on commercial real estate[220]. - As of March 31, 2025, Ladder Capital held a portfolio of 54 balance sheet first mortgage loans with an aggregate book value of $1.7 billion, with a weighted average loan-to-value ratio of 67.5%[229][230]. - The company owned 149 single tenant net leased properties with an undepreciated book value of $591.5 million, fully leased with 100% rent collection during the three months ended March 31, 2025[237]. - Ladder Capital's CMBS investments totaled $1.5 billion in 105 CUSIPs, with 99.3% rated investment grade as of March 31, 2025[243]. - The weighted average duration of the CMBS investments was 2.9 years, with 59.0% of the collateral located in the top 25 metropolitan statistical areas in the U.S.[245]. Financial Position and Debt - As of March 31, 2025, the company had $2.0 billion of senior unsecured notes outstanding, including $500.0 million due in 2031[250]. - Ladder Capital maintains a $3.7 billion pool of unencumbered assets, primarily consisting of first mortgage loans and unrestricted cash[251]. - The company held $483.1 million of U.S. Treasury securities classified as cash and cash equivalents on its consolidated balance sheet as of March 31, 2025[248]. - As of March 31, 2025, the company had $850.0 million in its Revolving Credit Facility, increased from $725 million on December 20, 2024[252]. - Total debt obligations as of March 31, 2025, amounted to $2.77 billion, with significant components including $2.01 billion in senior unsecured notes[336]. - As of March 31, 2025, the Company had $2.0 billion of senior unsecured notes outstanding, including $287.7 million of 5.25% notes due 2025, $599.5 million of 4.25% notes due 2027, $633.9 million of 4.75% notes due 2029, and $500.0 million of 7.00% notes due 2031[339]. Income and Expenses - The company reported a net interest income of $20.3 million for the three months ended March 31, 2025, a decrease of $6.9 million from the previous quarter[270]. - Interest income decreased by $13.8 million to $64.3 million, while interest expense decreased by $6.9 million to $44.0 million for the same period[270]. - Total other income decreased by $10.5 million to $30.9 million for the three months ended March 31, 2025[270]. - Real estate operating income decreased by $1.6 million during the three months ended March 31, 2025, primarily due to sales that occurred in the previous quarter[279]. - The company recorded a net income of $11.6 million for the three months ended March 31, 2025, down from $16.4 million in the same period of the previous year, reflecting a decrease of $4.9 million[293]. Cash Flow and Investments - The company funded $316.4 million in commercial mortgage loans and purchased $521.8 million in securities during the three months ended March 31, 2025, contributing to a net increase in the securities portfolio of $395.5 million[294]. - Cash and cash equivalents were $479.8 million as of March 31, 2025, down from $1.3 billion at the end of 2024[325]. - The company experienced a net decrease in cash of $812.7 million in Q1 2025, driven by cash used in operating, investing, and financing activities[327]. - Proceeds from the sale of securities provided net cash of $39.9 million for the three months ended March 31, 2025, compared to $4.8 million for the same period in 2024[363]. - The Company had $13.1 million of proceeds from sales of real estate for the three months ended March 31, 2025, with no proceeds from real estate sales in the same period of 2024[364]. Loan Loss Provisions and Allowances - The provision for loan losses for the three months ended March 31, 2025, was $(0.1) million, compared to $5.8 million for the same period in 2024[381]. - The allowance for loan losses as of March 31, 2025, was $52.8 million, unchanged from December 31, 2024[382]. - The company utilizes a current expected credit loss model (CECL) for estimating loan loss provisions, which includes both portfolio-based and asset-specific components[375]. - The company evaluates the financial capability of borrowers and the performance of collateral properties on a loan-by-loan basis, considering factors such as cash flow and liquidation value[378]. Shareholder Distributions and Stock Repurchase - The Company has authorized the repurchase of $100.0 million of its Class A common stock as of April 23, 2025, increasing the remaining authorization from $66.8 million[356]. - The company intends to distribute at least 90% of its taxable income to maintain its qualification as a REIT, with regular quarterly distributions planned[359]. - The company intends to continue declaring regular quarterly distributions to shareholders approximating the REIT's net taxable income, maintaining its REIT status[399]. Market and Economic Conditions - The company’s critical accounting estimates are subject to uncertainty due to changing macro-economic conditions[381]. - The CECL accounting estimate is sensitive to macro-economic conditions and the vintage and location of underlying assets[381].

Financial Data and Key Metrics Changes - In Q1 2025, the company generated distributable earnings of $25.5 million, or $0.20 per share, with a return on equity of 6.6% and adjusted leverage of 1.4 times [5][21] - As of March 31, 2025, the company's liquidity stood at $1.3 billion, including $480 million in cash and cash equivalents, with 83% of total assets unencumbered [10][21] - The company's total gross leverage was 1.83 times, with 72% of debt comprised of unsecured corporate bonds [22][24] Business Line Data and Key Metrics Changes - The company originated $329 million in new loans and acquired $521 million in AAA securities in Q1 2025, totaling over $800 million in investment activity [7][12] - The loan portfolio as of March 31, 2025, was $1.7 billion, representing 38% of total assets, with a weighted average yield of 8.7% [11][28] - The real estate portfolio generated $12.2 million of net operating income during Q1 2025, primarily consisting of net leased properties [15][30] Market Data and Key Metrics Changes - 74% of new loan originations in Q1 2025 were backed by multi-family or industrial assets [13][50] - The company expects muted payoffs for the remainder of the year due to strong payoffs achieved in 2024 [13] Company Strategy and Development Direction - The company aims to redeploy liquidity generated from loan payoffs into new loans that better reflect current market conditions [6][9] - The strategy includes a shift towards unsecured debt as the primary funding source, with a focus on maintaining a robust balance sheet and high credit ratings [10][11][24] - The company is prepared to navigate market volatility and capitalize on opportunities with the best risk-adjusted returns [18] Management's Comments on Operating Environment and Future Outlook - Management acknowledges the potential for market volatility and uncertainty but remains optimistic about the company's liquidity and balance sheet strength [8][9] - The company anticipates attractive opportunities arising from the current economic environment, particularly in conduit securitizations [40] Other Important Information - The company has a CECL reserve of $52 million, which is deemed sufficient to cover potential losses in the loan portfolio [14][28] - The company repurchased $20 million in principal value of unsecured bonds during Q1 2025 and declared a $0.23 per share dividend [26][27] Q&A Session Summary Question: Regarding origination activity and spreads - The company noted that the blended spread of 394 basis points was influenced by market volatility, with expectations for continued opportunities in the high 300s range [44][49] Question: Expectations for origination pace - Management expects origination to exceed the pace set in Q1 2025, despite some slowdown in securitizations due to market volatility [56][61] Question: Long-term views on the net lease portfolio - The company is open to holding or selling properties based on market conditions, with no active attempts to sell but willing to grow the portfolio [63][67] Question: Outlook on interest rates and their impact - Management anticipates a steeper yield curve, with expectations for the 10-year treasury yield to rise, which could create opportunities for the company [72][77] Question: Asset allocation and future mix - The company does not have a fixed game plan for asset allocation but aims to maintain liquidity while adjusting to market conditions [90][92]

Financial Performance - Ladder Capital reported distributable earnings of $25.5 million, resulting in a distributable EPS of $0.20 and an after-tax distributable ROAE of 6.6%[9] - The company declared a Q1 2025 cash dividend of $0.23 per LADR share, representing a 9.0% annual dividend yield[9] - Net interest income was $20.3 million for Q1 2025[42] Balance Sheet & Liquidity - Total liquidity exceeded $1.3 billion, including $480 million in unrestricted cash and cash equivalents, and an undrawn corporate revolving credit facility[7, 9] - The company's investment assets and unrestricted cash totaled $4.6 billion, including $1.7 billion in senior secured first mortgage loans (38% of total), $892 million in CRE equity (20%), and $1.5 billion in securities (32%)[7, 9] - Unencumbered assets totaled $3.7 billion, representing 83% of total assets, with 85% comprised of cash, first mortgage loans, and investment grade securities[7, 9, 34] Loan Portfolio - New loan originations amounted to $329 million, leading to a $138 million growth in the loan portfolio[7] - The weighted average spread on new balance sheet loans was 394 basis points[7] - The loan portfolio totaled $1.7 billion with a weighted average loan-to-value (LTV) of 67%[7, 15] Capital Structure - 72% of total debt was comprised of unsecured corporate bonds[9, 33] - The adjusted leverage ratio was 1.4x, or 1.2x net of cash[7, 9, 33] - 98% of debt is non-mark-to-market[7, 9, 33]

Over the last four quarters, the company has surpassed consensus EPS estimates three times. Ladder Capital, which belongs to the Zacks REIT and Equity Trust industry, posted revenues of $51.2 million for the quarter ended March 2025, missing the Zacks Consensus Estimate by 10.64%. This compares to year- ago revenues of $69 million. The company has topped consensus revenue estimates three times over the last four quarters. This quarterly report represents an earnings surprise of -9.09%. A quarter ago, it was ...

Financial Data and Key Metrics Changes - In Q1 2025, the company generated distributable earnings of $25.5 million or $0.20 per share, achieving a return on equity of 6.6% with adjusted leverage of 1.4 times [4][14] - As of March 31, 2025, the company had $1.3 billion in liquidity, with 83% of its asset base unencumbered and 72% of its debt comprised of unsecured corporate bonds [6][7] - The carrying value of the securities portfolio increased by 37% from year-end to $1.5 billion, with a weighted average yield of 5.67% [19] Business Line Data and Key Metrics Changes - The loan portfolio stood at $1.7 billion, representing 38% of total assets, with a weighted average yield of 8.7% [8] - New loan originations in Q1 totaled $329 million, with 74% backed by multifamily or industrial assets [9][24] - The real estate portfolio generated $12.2 million of net operating income during the first quarter, primarily consisting of net leased properties [11][20] Market Data and Key Metrics Changes - The company noted that the current macroeconomic environment is characterized by persistent interest rate volatility and geopolitical uncertainty, impacting commercial real estate demand [12][13] - The company expects to see more attractive lending opportunities as acquisitions become more common and newly built multifamily units come off construction loans [22][23] Company Strategy and Development Direction - The company is focused on redeploying liquidity generated from loan payoffs into new loans at lower reset basis, reflecting current market conditions [5] - The strategy includes a shift towards unsecured debt as the primary funding source, aiming for potential investment-grade ratings [8][17] - The company plans to maintain a disciplined approach to capital deployment, prioritizing higher-yielding loans over securities [25][75] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in navigating market volatility due to substantial liquidity and a robust balance sheet [6][13] - The company anticipates an increase in loan originations for the remainder of 2025, despite potential slowdowns in certain areas [39][44] - Management highlighted the importance of being well-capitalized to capitalize on opportunities that arise from market fluctuations [13][81] Other Important Information - The company repurchased $20 million in principal value of unsecured bonds during the first quarter and declared a $0.23 per share dividend [16][18] - The CECL reserve remained at $52 million, which management believes is sufficient to cover potential losses [10][19] Q&A Session Summary Question: What was the origination activity in the quarter? - The company noted that the blended spread was wide, with opportunities arising from market volatility and special situations [30][31] Question: Do you expect originations to maintain or exceed the pace generated in the first quarter? - Management expects originations to exceed the first quarter pace [39] Question: How are you thinking about the net lease portfolio longer term? - The company is open to selling properties but is not actively managing to sell; they are prepared to hold assets [45][49] Question: What is the outlook for the ten-year treasury yield? - Management anticipates the ten-year yield will rise due to the U.S. deficit, projecting it could reach around 4.75% in six months [57] Question: How do you protect against interest rate risk when adding CMBS? - The company hedges with swaps and focuses on floating rate instruments to mitigate volatility [63]