New York Mortgage Trust(NYMT) - 2025 Q2 - Quarterly Results

Executive Summary Second Quarter 2025 Highlights Despite a $3.486 million net loss, EAD of $0.22 per share exceeded the $0.20 dividend, with a 1.50% net interest spread Summary of Second Quarter 2025 Financial Results | Metric | Amount (in thousands) | | :---------------------------------------------------------- | :-------------------- | | Net loss attributable to Company's common stockholders | $ (3,486) | | Net loss attributable to Company's common stockholders per share (basic) | $ (0.04) | | Earnings available for distribution attributable to Company's common stockholders (1) | $ 20,024 | | Earnings available for distribution per common share (1) | $ 0.22 | | Yield on average interest earning assets (1) (2) | 6.48 % | | Interest income | $ 140,901 | | Interest expense | $ 104,454 | | Net interest income | $ 36,447 | | Net interest spread (1) (3) | 1.50 % | | Book value per common share at the end of the period | $ 9.11 | | Adjusted book value per common share at the end of the period (1) | $ 10.26 | | Economic return on book value (4) | (0.64)% | | Economic return on adjusted book value (5) | 0.29 % | | Dividends per common share | $ 0.20 | Key Developments Q2 2025 saw significant Agency investments and residential loan acquisitions, with Constructive Loans acquisition post-quarter - Investing Activities (Q2 2025): * Acquired approximately $503.7 million of Agency investments with an average coupon of 5.29%[5] * Acquired approximately $280.2 million in residential loans with an average gross coupon of 9.76%[5] * Received approximately $13.0 million in proceeds from the redemption of a Mezzanine Lending investment[5] - Subsequent Events (Post Q2 2025): * Issued $90.0 million in 9.875% Senior Notes due 2030, generating approximately $86.6 million in net proceeds (July 8, 2025)[6] * Acquired the remaining 50% ownership interests in Constructive Loans, LLC for approximately $38.4 million, accelerating expansion into residential business purpose lending (July 15, 2025)[6] * Completed a securitization of residential loans, yielding approximately $345.9 million in net proceeds, used to redeem two prior securitizations (July 24, 2025)[6] Management Commentary CEO Jason Serrano highlighted solid Q2 performance with recurring earnings exceeding dividends, emphasizing Constructive acquisition for strategic expansion - CEO Jason Serrano commented on: * Solid second-quarter performance with recurring earnings surpassing the dividend[7] * Effective execution of long-term capital allocation strategy and strong liquidity position[7] * Pivotal acquisition of Constructive Loans, LLC, accelerating expansion into residential business purpose lending[7] * Strategic move to enhance ability to meet demand for non-agency credit and diversify the balance sheet for greater stockholder value[7] Financial Performance Condensed Consolidated Balance Sheets Total assets grew to $10.55 billion, driven by residential loans and investment securities, with equity at $1.38 billion Condensed Consolidated Balance Sheets (Selected Items, in thousands) | Item | June 30, 2025 (unaudited) | December 31, 2024 | | :-------------------------------------------- | :------------------------ | :---------------- | | ASSETS | | | | Residential loans, at fair value | $ 4,026,027 | $ 3,841,738 | | Investment securities available for sale, at fair value | $ 5,109,601 | $ 3,828,544 | | Total Assets | $ 10,552,332 | $ 9,217,282 | | LIABILITIES AND EQUITY | | | | Repurchase agreements | $ 4,907,436 | $ 4,012,225 | | Collateralized debt obligations | $ 3,364,600 | $ 2,978,444 | | Total liabilities | $ 9,155,677 | $ 7,806,148 | | Company's stockholders' equity | $ 1,381,203 | $ 1,394,720 | | Total Liabilities and Equity | $ 10,552,332 | $ 9,217,282 | - Assets of consolidated variable interest entities (VIEs) totaled $4.414 billion as of June 30, 2025, up from $3.989 billion at December 31, 2024[24] - Liabilities of consolidated VIEs also increased to $3.859 billion from $3.477 billion over the same period[24] Condensed Consolidated Statements of Operations Net interest income significantly increased to $36.4 million, resulting in net income of $8.5 million and basic EPS of $0.04 Condensed Consolidated Statements of Operations (Selected Items, in thousands) | Item | For the Three Months Ended June 30, 2025 | For the Three Months Ended June 30, 2024 | | :-------------------------------------------------------- | :--------------------------------------- | :--------------------------------------- | | Interest income | $ 140,901 | $ 90,775 | | Interest expense | $ 104,454 | $ 71,731 | | Total net interest income | $ 36,447 | $ 19,044 | | Total net loss from real estate | $ (3,014) | $ (13,106) | | Total other (loss) income | $ (9,264) | $ (6,080) | | Total general, administrative and operating expenses | $ 19,890 | $ 23,599 | | Income (loss) from operations before income taxes | $ 4,279 | $ (23,741) | | NET INCOME (LOSS) | $ 4,440 | $ (24,083) | | NET INCOME (LOSS) ATTRIBUTABLE TO COMPANY | $ 8,546 | $ (15,589) | | Preferred stock dividends | $ (12,032) | $ (10,439) | | NET (LOSS) INCOME ATTRIBUTABLE TO COMPANY'S COMMON STOCKHOLDERS | $ (3,486) | $ (26,028) | | Basic (loss) earnings per common share | $ (0.04) | $ (0.29) | | Diluted (loss) earnings per common share | $ (0.04) | $ (0.29) | Summary of Quarterly Earnings Quarterly net interest income increased to $36.4 million, with EAD per share at $0.22 consistently covering the $0.20 dividend Summary of Quarterly Earnings (Selected Metrics, in thousands) | Metric | June 30, 2025 | March 31, 2025 | December 31, 2024 | September 30, 2024 | June 30, 2024 | | :---------------------------------------------------------- | :------------ | :------------- | :---------------- | :----------------- | :------------ | | Interest income | $ 140,901 | $ 129,734 | $ 118,253 | $ 108,361 | $ 90,775 | | Total net interest income | $ 36,447 | $ 33,098 | $ 26,711 | $ 20,237 | $ 19,044 | | Net (loss) income attributable to Company's common stockholders | $ (3,486) | $ 30,285 | $ (41,828) | $ 32,410 | $ (26,028) | | Basic (loss) earnings per common share | $ (0.04) | $ 0.33 | $ (0.46) | $ 0.36 | $ (0.29) | | Earnings available for distribution per common share - basic (1) | $ 0.22 | $ 0.20 | $ 0.16 | $ 0.10 | $ 0.09 | | Book value per common share | $ 9.11 | $ 9.37 | $ 9.28 | $ 9.83 | $ 9.69 | | Adjusted book value per common share (1) | $ 10.26 | $ 10.43 | $ 10.35 | $ 10.87 | $ 11.02 | | Dividends declared per common share | $ 0.20 | $ 0.20 | $ 0.20 | $ 0.20 | $ 0.20 | Capital Allocation & Portfolio Overview Capital Allocation by Investment Category Total investment portfolio carrying value reached $8.61 billion, primarily in Single-Family residential loans and investment securities Allocated Capital at June 30, 2025 (in thousands) | Item | Single-Family | Multi-Family | Corporate/Other | Total | | :-------------------------------------------- | :------------ | :----------- | :-------------- | :---------- | | Residential loans | $ 4,026,027 | $ — | $ — | $ 4,026,027 | | Investment securities available for sale and TBAs | $ 4,979,330 | $ — | $ 140,435 | $ 5,119,765 | | Total investment portfolio carrying value | $ 8,129,984 | $ 302,290 | $ 177,551 | $ 8,609,825 | | Net Company capital allocated | $ 1,240,849 | $ 251,156 | $ (110,802) | $ 1,381,203 | - Leverage Ratios (June 30, 2025): * Company Recourse Leverage Ratio: 3.8x[9] * Portfolio Recourse Leverage Ratio: 3.6x[9] Interest Earning Assets and Net Interest Spread Total adjusted net interest income was $40.1 million, with a 6.48% yield on assets and 1.50% net interest spread Interest Earning Assets Performance (Three Months Ended June 30, 2025, in thousands) | Metric | Single-Family | Multi-Family | Corporate/Other | Total | | :------------------------------------ | :------------ | :----------- | :-------------- | :---------- | | Adjusted Interest Income | $ 128,824 | $ 2,203 | $ 1,452 | $ 132,479 | | Adjusted Interest Expense | $ (84,529) | $ — | $ (7,842) | $ (92,371) | | Adjusted Net Interest Income (Loss) | $ 44,295 | $ 2,203 | $ (6,390) | $ 40,108 | | Average Interest Earning Assets | $ 7,972,569 | $ 74,273 | $ 126,552 | $ 8,173,394 | | Yield on Average Interest Earning Assets | 6.46 % | 11.86 % | 4.59 % | 6.48 % | | Average Financing Cost | (4.86)% | — | (6.59)% | (4.98)% | | Net Interest Spread | 1.60 % | 11.86 % | (2.00)% | 1.50 % | - Key Definitions: * Yield on Average Interest Earning Assets: Annualized adjusted interest income divided by average interest earning assets[12] * Average Financing Cost: Annualized adjusted interest expense divided by average interest bearing liabilities[12] * Net Interest Spread: Difference between Yield on Average Interest Earning Assets and Average Financing Cost[12] Non-GAAP Financial Measures Reconciliation Adjusted Net Interest Income (Loss) and Net Interest Spread Adjusted net interest income and spread are non-GAAP measures for clearer asset yields and financing costs, excluding SLST impact - Adjusted Net Interest Income (Loss) and Net Interest Spread are non-GAAP measures calculated by: * Adjusting GAAP interest income by reducing Consolidated SLST CDO interest expense and including TBA dollar roll income[31][32] * Adjusting GAAP interest expense by reducing Consolidated SLST CDO interest expense and including the net interest component of interest rate swaps[31][32] * These adjustments remove the impact of Consolidated SLST and include hedging costs and TBA dollar roll income to better represent the cost of financing and economic equivalent of net interest income[31][32] Reconciliation of GAAP to Adjusted Net Interest Income (Loss) (Three Months Ended June 30, 2025, in thousands) | Item | Single-Family | Multi-Family | Corporate/Other | Total | | :------------------------------------ | :------------ | :----------- | :-------------- | :---------- | | GAAP interest income | $ 137,246 | $ 2,203 | $ 1,452 | $ 140,901 | | Consolidated SLST CDO interest expense | $ (8,429) | $ — | $ — | $ (8,429) | | TBA dollar roll income | $ 7 | $ — | $ — | $ 7 | | Adjusted interest income | $ 128,824 | $ 2,203 | $ 1,452 | $ 132,479 | | GAAP interest expense | $ (96,107) | $ — | $ (8,347) | $ (104,454) | | Consolidated SLST CDO interest expense | $ 8,429 | $ — | $ — | $ 8,429 | | Net interest benefit of interest rate swaps | $ 3,149 | $ — | $ 505 | $ 3,654 | | Adjusted interest expense | $ (84,529) | $ — | $ (7,842) | $ (92,371) | | Adjusted net interest income (loss) | $ 44,295 | $ 2,203 | $ (6,390) | $ 40,108 | Earnings Available for Distribution (EAD) EAD, a new non-GAAP measure, indicates income-generating capacity by excluding unrealized, non-cash, or non-recurring items - EAD is defined as GAAP net income (loss) attributable to Company's common stockholders, excluding: * Realized and unrealized gains (losses)[39] * Gains (losses) on derivative instruments (excluding net interest benefit of interest rate swaps and TBA dollar roll income)[39] * Impairment of real estate, loss on reclassification of disposal group, and other non-recurring gains (losses)[39] * Depreciation and amortization of operating real estate, non-cash expenses, non-recurring transaction expenses[39] * Income tax effect of non-EAD items and EAD attributable to non-controlling interests[39] Reconciliation of GAAP Net (Loss) Income to EAD (Three Months Ended June 30, 2025, in thousands) | Item | June 30, 2025 | | :-------------------------------------------------------- | :------------ | | GAAP net (loss) income attributable to Company's common stockholders | $ (3,486) | | Adjustments: | | | Realized losses, net | $ 3,771 | | Unrealized (gains) losses, net | $ (24,614) | | Losses (gains) on derivative instruments, net (1) | $ 30,627 | | Unrealized losses (gains), net on equity investments (2) | $ 3,352 | | Impairment of real estate | $ 3,913 | | Other (gains) losses (3) | $ (548) | | Depreciation and amortization of operating real estate | $ 5,928 | | Non-cash expenses (4) | $ 2,561 | | Transaction expenses (5) | $ 1,340 | | Income tax effect of adjustments | $ (173) | | EAD adjustments attributable to non-controlling interests | $ (2,647) | | Earnings available for distribution attributable to Company's common stockholders | $ 20,024 | | EAD per common share - basic | $ 0.22 | Adjusted Book Value Per Common Share Adjusted book value per common share is a non-GAAP measure modifying GAAP book value by excluding depreciation and adjusting liabilities to fair value - Adjusted book value per common share is calculated by making the following adjustments to GAAP book value: * Exclude the Company's share of cumulative depreciation and lease intangible amortization expenses related to real estate[43] * Exclude the cumulative adjustment of redeemable non-controlling interests to estimated redemption value[43] * Adjust amortized cost liabilities that finance the investment portfolio to fair value[43] Reconciliation of GAAP to Adjusted Book Value (June 30, 2025, in thousands) | Item | June 30, 2025 | | :-------------------------------------------------------- | :------------ | | Company's stockholders' equity | $ 1,381,203 | | Preferred stock liquidation preference | $ (558,498) | | GAAP book value | $ 822,705 | | Add: | | | Cumulative depreciation expense on real estate (1) | $ 25,170 | | Cumulative amortization of lease intangibles related to real estate (1) | $ 4,620 | | Cumulative adjustment of redeemable non-controlling interest to estimated redemption value | $ 49,574 | | Adjustment of amortized cost liabilities to fair value | $ 24,153 | | Adjusted book value | $ 926,222 | | Common shares outstanding | 90,314 | | GAAP book value per common share (2) | $ 9.11 | | Adjusted book value per common share (3) | $ 10.26 | Equity Investments in Multi-Family Entities The company is strategically repositioning by disposing of multi-family joint venture equity investments and reallocating capital - Strategic Repositioning: * Opportunistic disposition of joint venture equity investments in multi-family properties[50] * Reallocation of capital away from multi-family assets to targeted assets[50] * Certain joint venture equity investments classified as held for sale as of June 30, 2025[50] Reconciliation of Net Equity Investments in Consolidated Multi-Family Properties and Disposal Group Held for Sale (June 30, 2025, in thousands) | Item | Amount | | :---------------------------------------------------------------- | :-------- | | Cash and cash equivalents | $ 3,941 | | Real estate, net | $ 473,586 | | Assets of disposal group held for sale | $ 111,500 | | Other assets | $ 14,821 | | Total assets | $ 603,848 | | Mortgages payable on real estate, net | $ 364,100 | | Liabilities of disposal group held for sale | $ 92,151 | | Other liabilities | $ 8,877 | | Total liabilities | $ 465,128 | | Redeemable non-controlling interest in Consolidated VIEs | $ 12,782 | | Less: Cumulative adjustment of redeemable non-controlling interest to estimated redemption value | $ (49,574) | | Non-controlling interest in Consolidated VIEs | $ 582 | | Non-controlling interest in disposal group held for sale | $ 1,963 | | Net equity investment (1) | $ 172,967 | - The net equity investment as of June 30, 2025, consists of $155.6 million in consolidated multi-family properties and $17.4 million in disposal group held for sale[52] Company Information & Disclosures About New York Mortgage Trust New York Mortgage Trust, Inc. is an internally managed REIT focused on acquiring, investing in, financing, and managing mortgage-related residential assets - New York Mortgage Trust, Inc. is an internally managed REIT[16] - Its business involves acquiring, investing in, financing, and managing primarily mortgage-related residential assets[16] Defined Terms This section defines various financial and investment terms used in the report, covering securities, instruments, and portfolio categories Cautionary Statement Regarding Forward-Looking Statements This cautionary statement advises that forward-looking statements are based on estimates, with actual results potentially differing due to market and operational risks Conference Call & Supplemental Information Executive management will host a conference call and webcast on July 31, 2025, to discuss Q2 2025 results, with supplemental materials and Form 10-Q available - Conference Call Details: * Date: Thursday, July 31, 2025[14] * Time: 9:00 a.m., Eastern Time[14] * Access: Pre-registration required via provided link; live audio webcast available on Investor Relations section of company website[14] * Replay: Webcast replay link available for 12 months[14] - Supplemental Information: * A supplemental financial presentation will be posted on the company's website[15] * The Quarterly Report on Form 10-Q for Q2 2025 is expected to be filed with the SEC on or about August 1, 2025, and will be available on the company's website[15]