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Lument Finance Trust(LFT) - 2024 Q2 - Quarterly Report

Financial Performance - Net income attributable to common stockholders was $3.4 million, or $0.07 per share of common stock for Q2 2024[139] - Distributable Earnings for Q2 2024 were $4.8 million, or $0.09 per share of common stock[139] - The company announced a second quarter common dividend of $0.08 per share, a 14.3% increase from the previous quarter[139] - For the three months ended June 30, 2024, the company recorded earnings per share of $0.07, declared a quarterly dividend of $0.08 per share, and reported Distributable Earnings of $0.09 per share[148] - The total stockholders' equity as of June 30, 2024, was $242,095,526, with a book value per share of common stock at $3.48[155] - The company’s Distributable Earnings for the three months ended June 30, 2024, amounted to $4,822,392, compared to $7,578,321 for the previous quarter[154] - The company reported net income attributable to common stockholders of $3,413,445 for the three months ended June 30, 2024, compared to $1,389,185 for the same period in 2023, representing a significant increase[199] - For the six months ended June 30, 2024, net income attributable to common stockholders was $9,208,628, or $0.18 per share, compared to $5,970,918, or $0.11 per share, for the same period in 2023, representing a 54.5% increase in net income[207] Loan Portfolio and Financing - The senior loan portfolio totals $1.2 billion, with 100% floating rate and an average spread to 30-day term SOFR of 3.59%[139] - Multifamily assets represent 93.2% of the loan portfolio[139] - As of June 30, 2024, 99.9% of investments earned a floating rate of interest, all indexed to 30-day term SOFR[141] - 94.5% of performing loans have interest rate caps with a weighted-average strike price of 2.8%[143] - 97.3% of the commercial mortgage loans in the portfolio were current as to principal and interest as of June 30, 2024[145] - Non-mark-to-market financing was $1.0 billion as of June 30, 2024, representing 100% of secured financings[139] - The unpaid principal balance of commercial mortgage loans held-for-investment decreased from $1,397,385,160 as of December 31, 2023, to $1,201,753,001 as of June 30, 2024[158] - The balance of commercial mortgage loans held-for-investment at June 30, 2024, was $1,186,653,339, reflecting a decrease due to principal repayments[157] - The company reported total loan commitments of $1.2 billion as of June 30, 2024, with a weighted average risk rating of 3.6[175] - The company has experienced $98.2 million in loan payoffs during the reporting period[139] Revenue and Growth - The company reported a total revenue of $28,250,000 for October 18, 2021, compared to $24,252,193 for the same period last year, reflecting a growth of approximately 16.5%[1] - For April 27, 2022, the revenue increased to $54,470,000, up from $49,800,000, indicating a year-over-year growth of about 13.4%[3] - The company reported a total revenue of $14,886,485 for the latest quarter, reflecting a significant increase compared to previous periods[1] - Future outlook suggests a projected revenue increase of 5.9% for the upcoming quarter, driven by new product launches and market expansion strategies[1] - The company provided a future outlook, projecting a 3.5% increase in revenue for the next quarter, with expectations of reaching $13,750,000[163] - The company is planning to expand its market presence with new developments in healthcare, as indicated by the revenue of $21,135,000 reported for November 2022[22] Operational Efficiency and Cost Management - Total expenses decreased from $4,425,049 for the three months ended June 30, 2023, to $3,533,804 for the same period in 2024, indicating improved cost management[199] - The company aims to achieve a 6.5% reduction in operational costs through efficiency improvements and technology integration[1] - The company reported a 7.4% increase in operational efficiency due to new technology implementations[163] Credit Losses and Risk Management - The unrealized provision for credit losses was $1,399,703 for the three months ended June 30, 2024, compared to $1,776,873 for the previous quarter[154] - The specific allowance for credit losses is determined by comparing the estimated fair value of collateral to the amortized cost of the loan, requiring significant judgment[191] - The company recorded a specific allowance of $0.9 million for credit losses on a loan in Philadelphia, PA, with an unpaid aggregate principal value of $15.0 million[168] - As of June 30, 2024, there were no impaired loans, non-accrual loans, or loans in maturity default, except for specific loans requiring evaluation[166] Cash Flow and Liquidity - As of June 30, 2024, the company had unrestricted cash and cash equivalents of $65.1 million, an increase from $51.2 million as of December 31, 2023[216] - For the six months ended June 30, 2024, net cash provided by operating activities totaled $14.6 million, an increase from $10.1 million in the same period of 2023, representing a 44.5% growth[220] - Cash flows from investing activities for the six months ended June 30, 2024, amounted to $162.3 million, significantly higher than $51.0 million in 2023, indicating a 218.0% increase[221] - The company anticipates that net proceeds from prior equity sales, combined with cash flow from operations and available borrowing capacity, will be sufficient to meet short-term liquidity requirements[223] Dividends and Shareholder Returns - The company declared a cash dividend rate of $0.08 per share of common stock for the second quarter of 2024, paid on July 15, 2024[228] - The cash dividend rate for Series A Preferred Stock for the second quarter of 2024 was declared at $0.49219 per share, also paid on July 15, 2024[228] - The company plans to continue making regular quarterly distributions to common stockholders, adhering to REIT distribution requirements[227]