Caliber(CWD) - 2024 Q2 - Quarterly Report

Financial Performance - Total revenues for the three months ended June 30, 2024, were $8.2 million, a decrease of 60.0$20.4 million in the same period of 2023, primarily due to the deconsolidation of Caliber Hospitality, LP and the Caliber Hospitality Trust[205]. - Total revenues for the six months ended June 30, 2024, were $31.1 million, a decrease of 37.7$50.0 million in 2023, primarily due to the deconsolidation of Caliber Hospitality, LP and the Caliber Hospitality Trust[211]. - Total revenues for the six months ended June 30, 2023, were $49,967 million, with asset management revenues contributing$9,723 million[245]. - The company reported a net loss of $11,285 million for the six months ended June 30, 2023, compared to a net loss of$4,811 million in the same period of the previous year[245]. - The net loss for the three months ended June 30, 2024, was $5.3 million, a significant improvement from a net loss of$11.6 million in the same period of 2023, reflecting a 54.1% reduction[205]. - The net loss attributable to CaliberCos Inc. was $8.5 million for the six months ended June 30, 2024, compared to a net loss of$6.9 million in 2023, reflecting a 23.1% increase in losses[211]. - The company reported a net loss before income taxes of $5.32 million for the three months ended June 30, 2024, compared to a loss of$11.58 million in the same period of 2023, indicating a 54% improvement[238]. - Consolidated Adjusted EBITDA for the six months ended June 30, 2024, was $1.22 million, a notable recovery from a loss of$4.12 million in the same period of 2023[241]. Revenue Sources - The company earns fund management fees ranging from 1.0% to 1.5% of unreturned capital contributions, with a specific fee of 0.70% for the Caliber Hospitality Trust[181]. - Fund management fees rose to $2.7 million in Q2 2024, up 12.5$2.4 million in Q2 2023, driven by increased managed capital[210]. - Fund set-up fees surged by 7,288.9% to $9,656 in Q2 2024, attributed to revenue from two new fund offerings[209]. - Fund set-up fees surged by 831.9$671,000 in 2024, attributed to revenue from two new fund offerings[215]. - Development fee revenue is generally based on 4.0% of total expected costs of development or construction projects, recognized over time as performance obligations are satisfied[270]. - Hospitality revenues include room rentals and food and beverage sales, recognized as earned when guests occupy rooms or utilize services[275]. Expenses and Losses - Total expenses decreased to $12.7 million in Q2 2024 from$31.4 million in Q2 2023, a reduction of 59.7%, mainly due to lower consolidated fund expenses[206]. - Total expenses decreased by 33.9% to $40.0 million in 2024 from$60.4 million in 2023, mainly due to reduced consolidated fund expenses following the deconsolidation[212]. - Operating costs for the three months ended June 30, 2024, were $5.76 million, down from$6.82 million in the same period of 2023, reflecting a 15.5% reduction in operational expenses[243]. - Interest expense increased to $2.6 million in 2024 from$2.1 million in 2023, primarily due to a rise in the weighted average corporate notes outstanding[217]. - General and administrative expenses rose by 34.3% to $4.0 million in 2024, driven by increased software, legal, and accounting fees[216]. Asset Management and Capital - Caliber manages over$2.9 billion in assets under management (AUM) and assets under development (AUD) as of the latest report[178]. - As of June 30, 2024, total assets under management (AUM) reached $773,213 thousand, up from$741,190 thousand as of December 31, 2023, reflecting a 4.3% increase[230]. - The Caliber Hospitality Trust's AUM increased to $234,300 thousand as of June 30, 2024, compared to$201,600 thousand as of December 31, 2023, marking a growth of 16.2%[230]. - Managed capital increased from $437,625 thousand as of December 31, 2023, to$469,800 thousand as of June 30, 2024, representing a growth of 7.4%[224]. - The Caliber Hospitality Trust's managed capital rose by $25.1 million during the six months ended June 30, 2024, primarily due to a$9.6 million hotel contribution and $15.5 million in non-voting preferred stock investments[225]. Market Conditions and Strategic Outlook - The annual inflation rate in the U.S. decreased to 3.0$13,085 million in cash and cash equivalents for the six months ended June 30, 2024, compared to a net inflow of $5,478 million in the same period of 2023[255]. - Cash flows used in operating activities increased to$(3,868) million for the six months ended June 30, 2024, compared to $(1,101) million in the same period of 2023[258]. - As of June 30, 2024, the company had issued unsecured promissory notes totaling$33.6 million, with a weighted average interest rate of 11.38%[253]. - The company recorded a decrease of $41.9 million in proceeds on notes payable during the six months ended June 30, 2024, compared to the same period in 2023[261]. Employee and Operational Changes - The company executed a reduction in force of approximately 10$4.0 million in compensation and benefits expenses[250]. - Management plans to negotiate extensions of loans, reduce operating costs, and increase capital raise through fundraising channels to address operating losses[250]. Technology and Innovation - The company has integrated advanced technologies, including artificial intelligence, to enhance project execution and investment management strategies[197]. - Fee-Related Earnings, a non-GAAP measure, is used to assess the company's ability to generate profits from fee-based revenues, focusing on core revenue streams[234]. - Distributable Earnings, another non-GAAP measure, is calculated as Fee-Related Earnings plus performance allocation revenue, providing insight into earnings available for distribution[235].