NexPoint Real Estate Finance(NREF) - 2025 Q1 - Quarterly Results

Financial Performance and Outlook This section details NexPoint Real Estate Finance's Q1 2025 financial performance, provides Q2 2025 guidance, and reconciles non-GAAP financial measures First Quarter 2025 Financial Results For the first quarter of 2025, NexPoint Real Estate Finance, Inc. (NREF) reported strong and resilient earnings, with a net income of $16.5 million ($0.70 per diluted share) and cash available for distribution (CAD) of $10.5 million ($0.45 per diluted common share). The company maintained a total portfolio of $1.2 billion and actively allocated capital through new investments, including a $55.0 million preferred stock purchase Q1 2025 Key Financial Metrics | Metric | Value | Per Diluted Share | | :--- | :--- | :--- | | Net Income Attributable to Common Stockholders | $16.5 million | $0.70 | | Cash Available for Distribution (CAD) | $10.5 million | $0.45 | - Management commented on the company's proactive stance in a challenging credit market, capitalizing on opportunities as traditional lenders face credit challenges[3] Portfolio Overview as of March 31, 2025 | Metric | Value | | :--- | :--- | | Total Portfolio Size | $1.2 billion | | Number of Investments | 85 | | Weighted-Average Loan to Value (LTV) | 58.7% | | Weighted-Average Debt Service Coverage Ratio (DSCR) | 1.46x | - The investment portfolio is primarily concentrated in multifamily (49.4%) and life sciences (31.9%), with a smaller allocation to single-family rental (15.6%)[7] - During the first quarter, NREF purchased $55.0 million of Preferred Stock and funded $20.8 million on a loan with a coupon of SOFR + 900 bps[7] Second Quarter 2025 Guidance NREF provided guidance for the second quarter of 2025, projecting Earnings Available for Distribution (EAD) of $0.43 per diluted common share and Cash Available for Distribution (CAD) of $0.48 per diluted common share at the midpoint. This guidance anticipates net income attributable to common stockholders to be between $7.6 million and $9.8 million Q2 2025 Guidance per Diluted Common Share (Midpoint) | Metric | Midpoint Value | | :--- | :--- | | Earnings Available for Distribution (EAD) | $0.43 | | Cash Available for Distribution (CAD) | $0.48 | Q2 2025 Earnings Available for Distribution (EAD) Guidance (in thousands, except per share amounts) | Metric | Low | Mid | High | | :--- | :--- | :--- | :--- | | Net income attributable to common stockholders | $7,557 | $8,771 | $9,833 | | EAD | $9,109 | $10,323 | $11,385 | | EAD per diluted common share | $0.38 | $0.43 | $0.48 | Q2 2025 Cash Available for Distribution (CAD) Guidance (in thousands, except per share amounts) | Metric | Low | Mid | High | | :--- | :--- | :--- | :--- | | CAD | $10,364 | $11,578 | $12,640 | | CAD per diluted common share | $0.43 | $0.48 | $0.53 | Reconciliations of Non-GAAP Financial Measures The company provides a detailed reconciliation of its non-GAAP metrics, EAD and CAD, to the nearest GAAP measure, net income. For Q1 2025, GAAP net income of $16.5 million was adjusted for items like unrealized gains and stock-based compensation to arrive at an EAD of $9.7 million and a CAD of $10.5 million. This contrasts sharply with Q1 2024, which saw a GAAP net loss of $14.3 million Reconciliation of Net Income to EAD and CAD (in thousands) | Metric | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Net income (loss) attributable to common stockholders | $16,518 | ($14,286) | | Adjustments (Unrealized gains/losses, etc.) | ($6,844) | $3,729 | | EAD | $9,674 | ($11,451) | | Adjustments (Amortization, Depreciation, etc.) | $813 | $26,324 | | CAD | $10,487 | $14,873 | Per Share Metrics Comparison | Metric | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | EAD per diluted common share | $0.41 | ($0.46) | | CAD per diluted common share | $0.45 | $0.60 | - Beginning in Q2 2024, EAD and CAD per share calculations are based on an adjusted weighted average share count that excludes the potential dilutive effect of Series B Preferred Stock redemptions[14] Corporate Information and Disclosures This section provides details on the Q1 2025 earnings conference call, company overview, and definitions of non-GAAP financial measures Conference Call Information The company scheduled a conference call for Thursday, May 01, 2025, at 11:00 a.m. ET to discuss the first quarter 2025 financial results. Access details were provided for live participation via phone and webcast, as well as for a replay available until May 15, 2025 - A conference call to discuss Q1 2025 results was scheduled for May 01, 2025, at 11:00 a.m. ET[10] - The call can be accessed live by dialing 888-660-4430 (Conference ID 6891136) or via webcast on the company's website. A replay is also available[11][12] About the Company and Disclosures NexPoint Real Estate Finance, Inc. is a publicly traded REIT focused on originating and investing in various real estate debt and equity instruments. The report includes standard forward-looking statement disclaimers and provides detailed definitions for its non-GAAP financial measures, including Earnings Available for Distribution (EAD), Cash Available for Distribution (CAD), and adjusted weighted average common shares, explaining their calculation and utility for investors - NREF is a publicly traded REIT (NYSE: NREF) that primarily originates, structures, and invests in first-lien mortgage loans, mezzanine loans, preferred equity, and various CMBS securities[15] - The press release contains forward-looking statements regarding Q2 2025 guidance and business strategy, which are subject to risks and uncertainties detailed in SEC filings[16] - EAD is a non-GAAP measure used to evaluate performance and long-term ability to pay distributions. It adjusts GAAP net income for non-cash items like unrealized gains/losses and stock-based compensation[18] - CAD is calculated by adjusting EAD for certain non-cash items like amortization of premiums and depreciation to better reflect the current ability to pay distributions[19]