ACRES Commercial Realty(US:ACR)2025-11-06 20:16Financial Performance - Net interest income for the three months ended September 30, 2025, was $8,371 thousand, a decrease of 19.9% compared to $10,459 thousand for the same period in 2024[14] - Total revenues for the nine months ended September 30, 2025, were $59,912 thousand, down 3.5% from $62,057 thousand for the same period in 2024[14] - Net income for the three months ended September 30, 2025, was $18,047 thousand, an increase of 124.5% compared to $8,054 thousand for the same period in 2024[15] - Net income allocable to common shares for the three months ended September 30, 2025, was $9,782 thousand, compared to $2,824 thousand for the same period in 2024, reflecting a significant increase[14] - The company reported a net income per common share (basic) of $1.38 for the three months ended September 30, 2025, compared to $0.37 for the same period in 2024[14] - Net income for the nine months ended September 30, 2025, was $21,641 million, an increase of 11.7% compared to $19,375 million in 2024[23] Assets and Liabilities - Total assets decreased to $1,688,647 thousand as of September 30, 2025, down from $1,881,467 thousand at December 31, 2024, representing a decline of approximately 10.3%[9] - Total liabilities decreased to $1,254,146 thousand as of September 30, 2025, down from $1,431,805 thousand at December 31, 2024, indicating a reduction of approximately 12.4%[9] - The allowance for credit losses decreased to $26,390 thousand as of September 30, 2025, from $32,847 thousand at December 31, 2024, a reduction of about 19.7%[9] - The company’s cash and cash equivalents decreased to $40,925 thousand as of September 30, 2025, from $56,713 thousand at December 31, 2024, a decline of approximately 28.0%[9] Investments and Financing - The company sold its interest in the FSU Student Venture for $106.8 million, resulting in a gain on the sale of investment in real estate[51] - The Company has a maximum exposure to loss of $28.719 million from its unconsolidated entities as of September 30, 2025[67] - The Company reported a total outstanding borrowing of $1,193,801,000 as of September 30, 2025, with a weighted average borrowing rate of 6.17% and a remaining maturity of 3.8 years[122] - The CRE term reinvestment financing facility has an outstanding principal of $795,215,000, with a collateral value of $1,084,626,000 and a weighted average interest rate of 5.90%[122] - The Company has secured borrowings totaling $1,441,290,000 as of September 30, 2025, which are guaranteed by the Company or its subsidiaries[128] Stock and Dividends - The Company repurchased $12.3 million of its common stock during the nine months ended September 30, 2025, representing 644,843 shares, compared to $5.3 million and 424,243 shares in the same period of 2024[162] - The Company anticipates distributing substantially all of its taxable income to stockholders to avoid corporate federal income taxes on retained income[175] - The Series C Preferred Stock will pay cumulative distributions at a floating rate equal to three-month Term SOFR plus a spread of 5.927% per annum effective July 30, 2024[158] Credit Risk and Loan Portfolio - The aging analysis revealed that as of September 30, 2025, total loans greater than 90 days past due amounted to $106.8 million, with whole loans accounting for $102.1 million of this total[94] - At September 30, 2025, the company had four CRE whole loans in payment default, with a total amortized cost of $102.1 million[96] - The credit risk profile of whole loans showed that Rating 1 loans amounted to $28.1 million, while Rating 2 loans totaled $444.8 million, indicating a significant concentration in lower-rated loans[88] Real Estate and Properties - The Company held investments in seven real estate properties as of September 30, 2025, with three included in investments in real estate and four in properties held for sale[102] - Total net investments in real estate and properties held for sale amounted to $155.4 million as of September 30, 2025, compared to $188.8 million at December 31, 2024[105] - The Company has properties held for sale valued at $108.7 million as of September 30, 2025, down from $201.1 million at December 31, 2024[105] Management and Fees - The Manager earned base management fees of $1.6 million for the three months ended September 30, 2025, and $4.8 million for the nine months ended September 30, 2025, compared to $1.6 million and $4.9 million for the same periods in 2024[181] - The Company reimbursed the Manager $1.1 million and $3.4 million for the three and nine months ended September 30, 2025, respectively, compared to $1.1 million and $3.7 million for the same periods in 2024[185]