Cherry Hill Mortgage Investment (US:CHMI)2025-11-06 21:19Financial Performance - Net income applicable to common stockholders was $1,955 thousand for the three months ended September 30, 2025, a recovery from a loss of $14,792 thousand in the same quarter of 2024[51]. - Comprehensive income for the three months ended September 30, 2025, was $7,076 thousand, compared to $3,956 thousand in the same period of 2024, indicating a positive trend[54]. - Net income for the nine months ended September 30, 2025, was a loss of $916,000 compared to a profit of $396,000 for the same period in 2024[58]. - The company reported a net operating loss (NOL) of $84.7 million as of September 30, 2025, which can be carried forward indefinitely[243]. - The provision for corporate business taxes for the nine months ended September 30, 2025, is $1,578, reflecting an effective tax rate of 238.5%[242]. Assets and Liabilities - Total assets increased to $1,521,487 thousand as of September 30, 2025, up from $1,491,175 thousand at December 31, 2024, representing a growth of 2.0%[48]. - Total liabilities increased to $1,286,028 thousand as of September 30, 2025, compared to $1,257,553 thousand at December 31, 2024, an increase of 2.3%[48]. - The accumulated deficit increased to $(271,979) thousand as of September 30, 2025, from $(249,643) thousand at December 31, 2024, indicating a growing financial challenge[48]. - Cash and cash equivalents increased to $55,447 thousand as of September 30, 2025, compared to $46,313 thousand at December 31, 2024, a growth of 19.5%[48]. - Total cash and cash equivalents and restricted cash at the end of the period was $64,651,000, up from $54,654,000 in the previous year[58]. Income and Revenue - Net interest income improved to $3,300 thousand for the three months ended September 30, 2025, compared to $109 thousand for the same period in 2024, marking a significant increase[51]. - Interest income rose to $15,643 thousand for the three months ended September 30, 2025, up from $14,327 thousand in the same quarter of 2024, reflecting a year-over-year increase of 9.2%[51]. - Servicing fee income for the nine months ended September 30, 2025, was $32,670,000, which is consistent with the previous year's figure of $36,921,000, showing a decrease of about 11.5%[106]. - The company reported a realized loss on RMBS of $10,496 thousand for the three months ended September 30, 2025, compared to a loss of $7,987 thousand in the same period of 2024[51]. - The company reported a comprehensive income of $7,076,000 for the three months ended September 30, 2025, compared to $3,956,000 for the same period in 2024, indicating an increase of about 78.5%[106]. Stock and Dividends - The company declared common dividends of $0.15 per share during the reporting period[58]. - Dividends paid during the nine months ended September 30, 2025, were $22,497,000, compared to $20,833,000 in 2024[58]. - The Company has authority to issue up to 100,000,000 shares of preferred stock, with 2,781,635 shares classified as Series A and 1,604,103 shares as Series B[138]. - The Series A Preferred Stock pays cumulative cash dividends at a rate of 8.20% per annum, equivalent to $2.05 per share[139]. - The Series B Preferred Stock has an initial dividend rate of 8.250% per annum, equivalent to $2.0625 per share, transitioning to a floating rate after April 15, 2024[140]. Investments and Market Risks - The Company is subject to credit and market risks primarily related to its investments in RMBS and Servicing Related Assets[69]. - The Company’s investments in MSRs are recorded at fair value, with fluctuations reported in net income[79]. - The Company’s derivative transactions include swaps and TBAs, primarily for interest rate risk management purposes[82]. - The Company’s two reportable segments are investments in RMBS and investments in Servicing Related Assets, which are the primary revenue-generating assets[103]. - The Company has determined that no reserves for unrecoverable advances are necessary as of September 30, 2025, and December 31, 2024[81]. Share-Based Compensation - The Company recognized share-based compensation expenses of approximately $226,000 and $231,000 for the three-month periods ended September 30, 2025, and September 30, 2024, respectively[162]. - As of September 30, 2025, there was approximately $861,000 of total unrecognized share-based compensation expense related to unvested LTIP-OP Units and RSUs, expected to be recognized over the next two years[162]. - The 2023 Equity Incentive Plan allows for the issuance of up to 2,830,000 shares of common stock through various equity-based awards[149]. - The Company granted a total of 181,942 restricted stock units (RSUs) under the 2023 Plan on May 30, 2024, with each RSU vesting ratably over a three-year period[155]. - The Company reported a net loss of $12,444,000 for the same period in 2024, compared to a net income of $4,515,000 for the three months ended September 30, 2025[167]. Derivatives and Hedging - The notional amount of interest rate swaps decreased to $828,700,000 as of September 30, 2025, from $1,171,750,000 at the end of 2024[176]. - The total notional amount of derivatives as of September 30, 2025, was $435,425,000, down from $809,275,000 at the end of 2024[176]. - The company reported a realized loss on derivatives of $15,254,000 for Q3 2025, compared to a loss of $16,831,000 in Q3 2024[186]. - The fair value of interest rate swaps as of September 30, 2025, was $13,676,000, with a weighted average pay rate of 1.82% and receive rate of 4.27%[176]. - The company utilized U.S. Treasury futures with a total notional amount of $180,400,000 as of September 30, 2025[182].