Ellington Financial(EFC) - 2025 Q1 - Quarterly Results

Financial Performance - Ellington Financial generated net income of $31.6 million, or $0.35 per common share, and adjusted distributable earnings of $35.5 million, or $0.39 per common share for Q1 2025[8]. - Longbridge's net income attributable to common stockholders for the three-month period ended March 31, 2025, was $31,649, compared to a net loss of $24,443 for the previous period[30]. - Net income for the three-month period ended March 31, 2025, was $39,324 thousand, a significant recovery from a loss of $995 thousand in the previous quarter[50]. - Common stockholders reported earnings per share of $0.55, a decrease of 21% compared to the previous period's $0.70[51]. Investment Portfolio - The investment portfolio segment produced net income of $57.4 million, with $53.2 million from the credit strategy and $4.2 million from the Agency strategy[7]. - The total adjusted long credit portfolio decreased by 4% to $3.30 billion as of March 31, 2025, compared to $3.42 billion as of December 31, 2024[9]. - The long Agency RMBS portfolio decreased by 14% quarter over quarter to $256.1 million as of March 31, 2025, driven by net sales[10]. - The company reported a total unrealized loss of $22,631,000, primarily due to market fluctuations in its investment portfolio[32]. - The company’s financial derivatives included realized and unrealized gains and losses, impacting overall financial performance[52]. Longbridge Segment - The Longbridge segment reported a net loss of $(1.0) million for Q1 2025, while the Longbridge portfolio increased by 31% sequentially to $549.0 million[11]. - As of March 31, 2025, Longbridge's HMBS assets increased to $9,597,451, up from $9,245,834 as of December 31, 2024, representing a growth of approximately 3.8%[23]. - The total volume of proprietary reverse mortgage loans increased to $866,425 as of March 31, 2025, from $728,959 as of December 31, 2024[23]. - The net change from reverse mortgage loans and HMBS obligations contributed $20,080,000 to the total income for the quarter[32]. Cash and Assets - Cash and cash equivalents totaled $203.3 million as of March 31, 2025, alongside other unencumbered assets of $650.2 million[8]. - Total assets increased to $16,644,228 thousand as of March 31, 2025, up from $16,317,028 thousand on December 31, 2024, representing a growth of 2%[42]. - Cash and cash equivalents rose to $203,288 thousand, compared to $192,387 thousand, reflecting an increase of approximately 5%[42]. Equity and Liabilities - The recourse debt-to-equity ratio was 1.7:1 as of March 31, 2025, while the total debt-to-equity ratio, including all borrowings, was 8.7:1[8]. - The total outstanding borrowings as of March 31, 2025, were $14,521,393, with a debt-to-equity ratio of 8.9:1, unchanged from December 31, 2024[27]. - Longbridge's total equity increased to $1,637,616 as of March 31, 2025, compared to $1,590,822 as of December 31, 2024[27]. - Total liabilities increased to $15,006,612 thousand as of March 31, 2025, up from $14,726,206 thousand, marking an increase of approximately 2%[42]. Dividends and Earnings - Book value per common share as of March 31, 2025, was $13.44, including dividends of $0.39 per common share for the quarter[8]. - The dividend yield was 12.2% based on the closing stock price of $12.75 per share on May 6, 2025[8]. - Adjusted Distributable Earnings for the three-month period ended March 31, 2025, was $43,260 thousand, compared to $53,941 thousand for the previous quarter, indicating a decrease of about 20%[50]. Market Conditions and Risks - Forward-looking statements indicate potential risks including changes in interest rates and market conditions that could affect future performance[36]. - The net change in fair value of the HMBS MSR Equivalent and Reverse MSRs was influenced by market conditions and model assumptions[54]. Conference Call - The company plans to host a conference call on May 8, 2025, to discuss financial results for the quarter ended March 31, 2025[35].