Cherry Hill Mortgage Investment (CHMI) - 2025 Q2 - Quarterly Results

Second Quarter 2025 Results Announcement Cherry Hill Mortgage Investment Corporation announced Q2 2025 results, featuring a strategic partnership, equity raise, and key financial metrics Second Quarter 2025 Highlights The company reported Q2 2025 highlights including a strategic partnership, successful equity raise, and key financial performance metrics - CHMI Solutions, Inc., a subsidiary of CHMI, entered into a strategic partnership and financing with Real Genius LLC, a Florida-based digital mortgage technology company[4][6] - Accessed at-the-market equity program, generating additional proceeds of approximately $8.9 million[6] Key Financial Metrics (Q2 2025) | Metric | Value | | :----------------------------------- | :---------- | | GAAP Net Loss Applicable to Common Stockholders | $(0.9) million | | GAAP Net Loss Per Share | $(0.03) | | Earnings Available for Distribution (EAD) | $3.2 million | | EAD Per Diluted Share | $0.10 | | Common Book Value per Share (June 30, 2025) | $3.34 | | Regular Common Dividend Declared | $0.15 per share | | Annualized Common Dividend Yield | 20.8% | | Aggregate Portfolio Leverage (June 30, 2025) | 5.3x | | Unrestricted Cash (June 30, 2025) | $58.0 million | Financial Performance This section details the company's consolidated income, comprehensive income, and earnings available for distribution for the quarter Consolidated Statements of Income (Loss) Q2 2025 saw a GAAP net loss of $0.9 million, a significant improvement from Q1, driven by higher net interest and servicing income and derivative gains Key Income Statement Figures (Three Months Ended, in thousands) | Metric | June 30, 2025 | March 31, 2025 | QoQ Change | | :----------------------------------- | :-------------- | :------------- | :----------- | | Net interest income | $2,641 | $2,166 | +$475 | | Net servicing income | $8,981 | $8,428 | +$553 | | Realized loss on RMBS, net | $(2,053) | $(3,992) | +$1,939 | | Realized gain on derivatives, net | $14,838 | $4,634 | +$10,204 | | Unrealized gain on RMBS, net | $3,508 | $14,780 | -$11,272 | | Unrealized loss on derivatives, net | $(19,147) | $(22,741) | +$3,594 | | Total Income (Loss) | $6,037 | $(3,050) | +$9,087 | | Total Expenses | $3,355 | $3,769 | -$414 | | Net Income (Loss) | $1,561 | $(6,992) | +$8,553 | | Net Loss Applicable to Common Stockholders | $(935) | $(9,313) | +$8,378 | | Net Loss Per Share (Diluted) | $(0.03) | $(0.29) | +$0.26 | Comprehensive Income (Loss) The company reported comprehensive income of $1.9 million for Q2 2025, a significant improvement from Q1, driven by net income and RMBS unrealized gains - Net unrealized gain on the Company's RMBS portfolio classified as available-for-sale, reported in accumulated other comprehensive income, was approximately $0.3 million[8] Comprehensive Income (Loss) (Three Months Ended, in thousands) | Metric | June 30, 2025 | March 31, 2025 | QoQ Change | | :----------------------------------- | :-------------- | :------------- | :----------- | | Net Income (Loss) | $1,561 | $(6,992) | +$8,553 | | Unrealized gain on RMBS, available-for-sale, net | $320 | $6,850 | -$6,530 | | Comprehensive income (loss) | $1,881 | $(142) | +$2,023 | | Comprehensive loss attributable to common stockholders | $(616) | $(2,593) | +$1,977 | Earnings Available for Distribution (EAD) EAD, a non-GAAP measure, provides insight into operational performance, with Q2 2025 EAD attributable to common stockholders at $3.2 million EAD Definition and Limitations EAD is a non-GAAP measure adjusting GAAP net income for specific items, but it has significant limitations and should not substitute GAAP net income - EAD is a non-GAAP financial measure defined as GAAP net income (loss), excluding realized/unrealized gain (loss) on RMBS, derivatives, MSRs (net of estimated amortization), and related tax expense[15] - EAD includes interest rate swap periodic interest income and drop income on TBA dollar roll transactions[15] - EAD is adjusted to exclude outstanding LTIP-OP Units and dividends paid on preferred stock[15] - EAD has significant limitations, including the exclusion of realized and unrealized gains (losses), and may not be comparable to similarly titled measures of other issuers due to differing methodologies[16] EAD Reconciliation EAD attributable to common stockholders for Q2 2025 was $3.2 million, a decrease from Q1 2025, primarily due to derivative and MSR adjustments EAD Reconciliation (Three Months Ended, in thousands) | Metric | June 30, 2025 | March 31, 2025 | QoQ Change | | :----------------------------------- | :-------------- | :------------- | :----------- | | Net Income (Loss) | $1,561 | $(6,992) | +$8,553 | | Realized loss on RMBS, net | $2,053 | $3,992 | -$1,939 | | Realized loss (gain) on derivatives, net | $(9,576) | $2,782 | -$12,358 | | Unrealized gain on RMBS, net | $(3,508) | $(14,780) | +$11,272 | | Unrealized loss on derivatives, net | $19,147 | $22,741 | -$3,594 | | Unrealized gain on investments in MSRs, net of estimated MSR amortization | $(5,473) | $(719) | -$4,754 | | Tax expense on realized and unrealized gain on MSRs | $1,607 | $957 | +$650 | | Total EAD | $5,811 | $7,981 | -$2,170 | | EAD Attributable to Common Stockholders | $3,247 | $5,376 | -$2,129 | | EAD Attributable to Common Stockholders, per Diluted Share | $0.10 | $0.17 | -$0.07 | Portfolio Overview This section provides an overview of the company's Mortgage Servicing Rights (MSR) and Residential Mortgage-Backed Securities (RMBS) portfolios, along with hedging activities Mortgage Servicing Rights (MSR) Portfolio The MSR portfolio generated $9.0 million in net servicing fee income, with an unpaid principal balance of $16.6 billion at quarter-end - Net servicing fee income for Q2 2025 was $9.0 million[10] MSR Portfolio Metrics (June 30, 2025) | Metric | Value | | :----------------------------------- | :-------------- | | Unpaid Principal Balance | $16.6 billion | | Carrying Value | $224.6 million | Residential Mortgage-Backed Securities (RMBS) Portfolio The RMBS portfolio had a book value of $1.1 billion and a carrying value of $1.2 billion, with a net interest spread of 2.61% RMBS Portfolio Metrics (June 30, 2025) | Metric | Value | | :----------------------------------- | :-------------- | | Book Value | ~$1.1 billion | | Carrying Value | ~$1.2 billion | | Net Interest Spread | 2.61% | | Weighted Average Coupon | 4.97% | | Weighted Average Maturity | 28 years | Hedging Activities Cherry Hill utilized interest rate swaps, TBAs, and Treasury futures to mitigate duration and interest rate risks for its RMBS and MSR portfolios - Cherry Hill used interest rate swaps, TBAs, and Treasury futures to mitigate duration risk and interest rate risk associated with its RMBS and MSRs[12] Hedging Instruments Notional Amounts (June 30, 2025) | Instrument | Notional Amount | | :----------------------------------- | :-------------- | | Interest Rate Swaps | $799.7 million | | TBAs | $(413.5) million | | Treasury Futures | $60.2 million | Dividends This section outlines the quarterly dividend declarations for common and preferred stockholders for Q2 2025 Dividend Declarations The Board of Directors declared quarterly dividends for common and preferred stockholders for Q2 2025, paid in July 2025 Q2 2025 Dividend Declarations | Stock Type | Dividend Per Share | Payment Date | Record Date | | :----------------------------------- | :----------------- | :----------- | :---------- | | Common Stock | $0.15 | July 31, 2025 | June 30, 2025 | | 8.20% Series A Cumulative Redeemable Preferred Stock | $0.5125 | July 15, 2025 | June 30, 2025 | | 8.250% Series B Fixed-to-Floating Rate Cumulative Redeemable Preferred Stock | $0.6413 | July 15, 2025 | June 30, 2025 | Company Information & Investor Resources This section provides details on additional information, investor resources, company overview, forward-looking statements, and contact information Additional Information Further financial details are available in the Company's Q2 2025 Form 10-Q and an investor presentation on its website - Additional information regarding financial condition and results of operations can be found in the Quarterly Report on Form 10-Q for the quarter ended June 30, 2025, filed with the SEC on August 7, 2025[19] - An investor presentation with supplemental information has been posted to the Investor Relations section of Cherry Hill's website, www.chmireit.com[19](index=19&type=chunk) Webcast and Conference Call Management hosted a conference call on August 7, 2025, to discuss results, with a webcast and archived recording available online - The Company's management hosted a conference call on August 7, 2025, at 5:00 pm Eastern Time[20] - A live webcast of the conference call and an online archive will be available in the investor relations section of the Company's website at www.chmireit.com[21](index=21&type=chunk) Conference Call Details | Detail | Value | | :----------------------------------- | :-------------- | | Domestic Dial-in | 1-800-715-9871 | | International Dial-in | 1-646-307-1963 | | Conference ID | 7589822 | About Cherry Hill Mortgage Investment Corporation Cherry Hill Mortgage Investment Corporation is a real estate finance company focused on acquiring, investing in, and managing US residential mortgage assets - Cherry Hill Mortgage Investment Corporation is a real estate finance company[22] - The Company acquires, invests in, and manages residential mortgage assets in the United States[22] Forward-Looking Statements This section contains cautionary statements regarding forward-looking information, noting that actual results may differ due to risk factors in SEC filings - This press release contains forward-looking statements regarding the Company's long-term growth opportunities, strategies, market expansion, and ability to generate attractive risk-adjusted returns[23] - These forward-looking statements are based upon present expectations but are not guaranteed to occur[23] - Factors that may cause actual results or performance to differ are described under "Risk Factors" in the Company's Annual Report on Form 10-K for the year ended December 31, 2024, and other SEC filings[23] Contact Information Investor relations contact details are provided for inquiries Investor Relations Contact | Detail | Value | | :----------------------------------- | :-------------- | | Phone | (877) 870-7005 | | Email | InvestorRelations@chmireit.com |