Sachem Capital(SACH) - 2025 Q3 - Quarterly Report

Loans and Investments - Loans disbursed for the three months ended September 30, 2025, totaled $44.657 million, while loans repaid amounted to $40.651 million[129]. - As of September 30, 2025, the gross principal amount of loans held for investment was $375.220 million, with a weighted average contractual interest rate of 13.21%[129]. - The allowance for credit losses as of September 30, 2025, was $11.083 million, representing 3.0% of the total gross principal amount of loans held for investment[134]. - The number of loans held for investment outstanding decreased from 157 as of December 31, 2024, to 119 as of September 30, 2025[129]. - The primary markets for the company's loans held for investment included Connecticut (45.5% of loans), Florida (14.3%), and Massachusetts (8.4%) as of September 30, 2025[131]. - The aggregate gross principal amount of residential loans held for investment was $202.220 million, accounting for 53.9% of the total[132]. - The company’s loan portfolio included 54 loans of $1 million or less, representing 45.4% of the total number of loans[131]. - The weighted average term to maturity for loans held for investment increased from 4 months as of December 31, 2024, to 6 months as of September 30, 2025[129]. Financial Performance - Total revenues for the three months ended September 30, 2025, decreased by 18.8% to $12,000,000 compared to $14,785,000 for the same period in 2024[138]. - Interest income from loans fell by 27.1% to $8,326,000, while fee income from loans increased by 6.6% to $1,964,000[138]. - Net income for the three months ended September 30, 2025, was $997,000, a significant improvement from a net loss of $5,051,000 in the same period of 2024[138]. - The provision for credit losses related to loans held for investment dropped by 90.0% to $812,000 compared to $8,096,000 in 2024[138]. - Total operating expenses decreased by 36.9% to $12,367,000 from $19,607,000 in the prior year[138]. Asset and Equity Changes - Total assets decreased by $7.6 million, or 1.5%, to $484.4 million as of September 30, 2025, mainly due to a $6.9 million decrease in cash and cash equivalents[151]. - Total liabilities decreased by $1.5 million, or 0.5%, to $308.8 million as of September 30, 2025, driven by a $55.5 million reduction in notes payable[152]. - Total shareholders' equity decreased by $6.0 million, or 3.3%, to $175.6 million as of September 30, 2025, due to increased dividends paid[153]. - Book value per common share decreased to $2.47 as of September 30, 2025, down from $2.54 as of June 30, 2025[144]. - Book value per common share decreased to $2.47 as of September 30, 2025, from $2.64 at December 31, 2024, primarily due to $10.4 million in dividends paid[150]. Non-Performing Loans - The company reported a total of 104.066 million in non-performing loans as of September 30, 2025, with a direct reserve of $2.372 million[134]. - The aggregate non-performing loan balance as of September 30, 2024, was $147.0 million, an increase of $62.4 million from December 31, 2023[143]. - The aggregate non-performing loan balance increased to $147.0 million as of September 30, 2024, up $62.4 million from $84.6 million at December 31, 2023[149]. Cash and Financing Activities - Cash and cash equivalents increased by 90.0% to $11.2 million as of September 30, 2025, compared to $5.9 million at the end of the previous year[155]. - The company entered into a new Credit Agreement on March 20, 2025, with a maturity date of March 2, 2026, and had borrowed $32.7 million under this facility as of September 30, 2025[158]. - A private placement of $100.0 million in Senior Secured Notes was completed on June 11, 2025, with an initial draw of $50.0 million and an additional draw of $40.0 million in September 2025[159][160]. - The company reduced its investments in limited liability companies by $12.8 million since December 31, 2024, using returns to fund additional loans[140]. - The company has no off-balance sheet transactions that could affect liquidity or capital resource requirements[161]. Employee Compensation - Compensation and employee benefits increased by 33.8% to $2,334,000, attributed to one-time cash bonuses and additional headcount[142].