Ellington Financial(US:EFC)2025-11-05 22:23Financial Performance - Ellington Financial reported GAAP net income of $29.5 million, or $0.29 per share, and adjusted distributable earnings of $54.2 million, or $0.53 per share, significantly exceeding dividends[3]. - The total net income attributable to common stockholders for the three-month period ended September 30, 2025, was $42,382 thousand, compared to $46,851 thousand for the previous quarter, reflecting a decrease of approximately 9.0%[31]. - The company reported a net income (loss) per share of common stock of $0.42 for the three-month period ended September 30, 2025, down from $0.46 in the previous quarter[31]. - Net income for the three-month period ended September 30, 2025, was $37,758, compared to $51,073 for the previous quarter, representing a decrease of approximately 26.2%[53]. - Net income attributable to common stockholders for the three-month period ended September 30, 2025, was $29,504,000, down from $42,923,000 in the previous quarter, a decline of 31.2%[42]. Portfolio and Asset Management - The total portfolio holdings grew by 12% sequentially, with a total adjusted long credit portfolio of $3.56 billion, an 11% increase from $3.22 billion as of June 30, 2025[3][8]. - Longbridge segment net income was $8.6 million, with the Longbridge portfolio increasing by 37% sequentially to $750 million, driven by record proprietary reverse mortgage loan originations[11]. - As of September 30, 2025, Longbridge's HMBS assets increased to $10,232,166 thousand from $9,920,301 thousand as of June 30, 2025, representing a growth of approximately 3.15%[24]. - Total loan origination volume for the three-month period ended September 30, 2025, was $498,577 thousand, up from $427,062 thousand for the period ended June 30, 2025, indicating an increase of about 16.7%[26]. - The long Agency RMBS portfolio decreased by 18% quarter-over-quarter to $220.7 million, driven by net sales[10]. Debt and Equity - The recourse debt-to-equity ratio was 1.8:1 as of September 30, 2025, with an overall debt-to-equity ratio of 8.6:1 when including all borrowings[6]. - The company aims to increase the proportion of unsecured borrowings over time, currently at nearly 20% of recourse borrowings[4]. - Recourse borrowings as of September 30, 2025, were $3,252,917 thousand, with a debt-to-equity ratio of 1.8:1, compared to $2,950,497 thousand and a ratio of 1.7:1 as of June 30, 2025[27][30]. - Non-recourse borrowings stood at $12,331,643 thousand as of September 30, 2025, with a debt-to-equity ratio of 6.9:1, slightly down from 7.0:1 as of June 30, 2025[27][30]. - Longbridge's total borrowings reached $15,584,560 thousand as of September 30, 2025, compared to $14,892,533 thousand as of June 30, 2025, marking an increase of about 4.6%[27]. Income and Expenses - Total interest income and other income for the three-month period ended June 30, 2025, was $120,446,000, with a net income attributable to common stockholders of $42,923,000, resulting in earnings per share of $0.45[34]. - The investment portfolio generated interest income of $87,096,000, while interest expense totaled $67,387,000, leading to a net interest income of $53,059,000[34]. - Total expenses, including investment-related expenses and other expenses, were $57,066,000, impacting net income[34]. - Total expenses for the three-month period ended September 30, 2025, were $57,012,000, slightly down from $57,066,000 in the previous quarter[42]. - The company incurred $7,074 in dividends on preferred stock for the quarter, slightly up from $7,036 in the previous quarter[53]. Market Conditions and Risks - Forward-looking statements highlight potential risks including changes in interest rates and market conditions, which could affect future performance[38]. - The company is externally managed by Ellington Financial Management LLC, which may influence strategic decisions and operational performance[36]. - The financial results indicate a diversified investment strategy, including residential and commercial mortgage loans, mortgage-backed securities, and consumer loans[36]. Shareholder Information - The weighted average shares of common stock outstanding increased to 102,726 thousand as of September 30, 2025, from 101,589 thousand as of June 30, 2025[31]. - The weighted average shares of common stock outstanding were 96,995,000, reflecting a slight increase compared to previous periods[34]. - Book value per common share as of September 30, 2025, was $13.40, slightly down from $13.49 as of June 30, 2025[44]. - The company plans to host a conference call on November 6, 2025, to discuss financial results for the quarter ended September 30, 2025, indicating ongoing communication with investors[37].