Caliber(US:CWD)2025-03-31 21:29Financial Performance - Total revenues for the year ended December 31, 2024, were $51.1 million, a decrease of 43.8% from $90.9 million in 2023, primarily due to the deconsolidation of Caliber Hospitality, LP and Caliber Hospitality Trust[204]. - Total expenses decreased by 46.1% to $64.4 million in 2024 from $119.5 million in 2023, mainly due to reduced consolidated fund expenses following the same deconsolidation[205]. - The net loss attributable to CaliberCos Inc. increased by 55.7% to $19.8 million in 2024 from $12.7 million in 2023[204]. - Asset management revenues rose by 21.1% to $20.6 million in 2024, compared to $17.0 million in 2023, driven by increased capital raise fees and managed capital[209]. - Performance allocations dropped significantly by 89.6% to $379,000 in 2024 from $3.7 million in 2023, due to changes in carried interest related to hospitality assets[210]. - Total Platform revenues increased slightly by 1.5% to $20.9 million in 2024 from $20.6 million in 2023[208]. - The company reported a net loss before income taxes of $21.5 million in 2024, an improvement from a loss of $27.6 million in 2023, reflecting a 22.2% reduction in losses[204]. - Consolidated Adjusted EBITDA for 2024 was $6,984 thousand, down from $10,168 thousand in 2023, reflecting a decrease of 31.5%[244]. Asset Management and Capital - Caliber has grown to manage over $2.9 billion in assets under management (AUM) and assets under development (AUD) over the past 15 years[181]. - The company has successfully raised a total of $742.8 million in capital through December 31, 2024, indicating strong investor interest in alternative assets[190]. - Managed capital increased from $437.6 million as of December 31, 2023 to $492.5 million as of December 31, 2024, representing a growth of 12.5%[222]. - Fair Value AUM rose from $741.2 million as of December 31, 2023 to approximately $794.9 million as of December 31, 2024, an increase of 7.2%[223]. - Total real estate managed capital increased from $343.6 million in 2023 to $414.2 million in 2024, reflecting a growth of 20.5%[224]. - Managed capital for the Caliber Hospitality Trust increased by $26.7 million during 2024, primarily due to the issuance of $9.6 million in operating partnership units and $17.1 million in non-voting preferred stock[226]. - Managed capital for residential investment funds rose by $22.5 million in 2024, driven by $9.6 million in capital raised and $21.2 million contributed by diversified funds[227]. - Managed capital for commercial investment funds increased by $15.9 million in 2024, with $11.0 million raised and $10.6 million contributed by diversified funds[228]. Economic Environment - The annual inflation rate in the U.S. peaked at 9.1% in June 2022 but decreased to 2.9% by December 2024, impacting investment behaviors and capital formation[197][198]. - The Federal Reserve increased the federal funds rate by 525 basis points from January 1, 2022, to September 2024, affecting the overall economic environment and investor appetite[198]. Investment Strategy - Caliber's investment strategy focuses on middle-market projects valued between $5.0 million and $50.0 million, leveraging local market intelligence and real-time data[182]. - The company has identified strategic acquisitions on off-market terms and anticipates continued opportunities despite increased asset valuations and competition[193]. Debt and Financing - As of December 31, 2024, the company had issued unsecured promissory notes totaling $32.8 million, with an average interest rate of 11.30%[256]. - The company plans to raise $20 million through preferred stock series AA financing to address upcoming corporate note maturities[253]. - The company intends to refinance existing 12-month term notes into a new 36-month term corporate note program, having successfully refinanced $2.7 million so far[253]. - Interest expense rose to $5.4 million in 2024 from $4.7 million in 2023, attributed to an increase in short-term operating loans[213]. - The total stockholders' deficit equity was $(8.4) million in 2024, compared to $6.7 million in 2023, indicating a significant decline in equity[216]. - A 100 basis point increase in variable interest rates would increase annual interest expense by $0.2 million[293]. Cash Flow and Liquidity - Operating activities generated a net cash inflow of $555 thousand in 2024, a significant improvement of $19,275 thousand compared to a cash outflow of $18,720 thousand in 2023[258]. - The company experienced a net cash outflow of $12,743 thousand in 2024, compared to a net inflow of $1,706 thousand in 2023, marking a change of $14,449 thousand[258]. - Net cash flows from operating activities for the year ended December 31, 2024, remained consistent compared to 2023, with an increase attributed to decreased interest payments related to consolidated funds notes payable[261]. - Net cash flows provided by investing activities increased due to payments received on related party notes receivable and a decrease in the acquisition of real estate assets[262]. - Net cash flows used in financing activities increased by $26.0 million due to a decrease in net proceeds on notes payable, while consolidated funds saw a decrease in redemptions and distributions to noncontrolling interest holders by $13.2 million[263]. Technology and Innovation - Caliber's technology stack includes advancements in proptech and artificial intelligence, enhancing its capital formation and investment management strategies[195]. Regulatory Environment - Recent legislation aims to expand the accredited investor criteria, potentially increasing Caliber's investor base significantly[191]. Risk Management - The company mitigates credit risk associated with revenues generated from real estate assets located in multiple states, including Alaska, Arizona, and Texas[294].