Lument Finance Trust(US:LFT)2025-11-12 22:02Financial Performance - Net income attributable to common stockholders was $0.7 million, or $0.01 per share of common stock[196]. - Distributable Earnings amounted to $1.0 million, or $0.02 per share of common stock[196]. - The company reported a net income attributable to common stockholders of $658,597 for the three months ended September 30, 2025, compared to $2,505,731 for the previous quarter[204][209]. - For the three months ended September 30, 2025, net income attributable to common stockholders was $658,597, a decrease from $2,505,731 for the three months ended June 30, 2025[272][274]. - For the nine months ended September 30, 2025, the net income attributable to common stockholders was $1,456,802, a decrease of 89.8% from $14,304,312 for the same period in 2024[287]. - Net interest income for the three months ended September 30, 2025, was $5,051,462, down from $6,960,779 in the previous quarter, primarily due to a $61.2 million decrease in the weighted-average principal balance of the loan portfolio[275]. - Net interest income decreased from $31,999,947 in the nine months ended September 30, 2024 to $19,746,775 in 2025, primarily due to a $269.1 million decrease in the weighted-average principal balance of the loan portfolio[288]. - Total expenses for the three months ended September 30, 2025, were $3,077,163, slightly lower than $3,156,065 for the three months ended June 30, 2025[272]. - The company recognized a provision for credit losses of $5,762,769 for the nine months ended September 30, 2025, compared to $3,494,024 for the same period in 2024[286]. - The company experienced a loss of $133,562 in other income and expense for the three months ended September 30, 2025, compared to a loss of $118,025 in the previous quarter[280]. Loan Portfolio and Financing - The senior loan portfolio is $0.8 billion, 100% floating rate with an average spread to 30-day term SOFR of 3.55%[196]. - Multifamily assets represent 89.6% of the loan portfolio[196]. - As of September 30, 2025, 92.7% of the commercial mortgage loans in the portfolio were current as to principal and interest[197]. - Non-mark-to-market financing was $0.7 billion as of September 30, 2025, representing 100% of secured financings[191]. - 60.6% of performing loans have interest rate caps with a weighted-average strike price of 2.27%[195]. - The company acquired 29 loans and 17 funded loan advances with an initial aggregate unpaid principal balance of $473.1 million and an aggregate purchase discount of $8.1 million[199]. - The balance of commercial mortgage loans held-for-investment was $821,843,480, down from $1,048,803,078 at December 31, 2024[212]. - The weighted average coupon for loans held-for-investment as of September 30, 2025, was 7.8%, with a weighted average remaining term of 1.3 years[212][213]. - The company secured a total loan commitment of $978,521,791 with an average loan-to-value (LTV) ratio of 71.7% across its multifamily properties[217]. - The average loan per unit is $151,630, with the highest unit loan amount reaching $269,852 in Chicago, IL[217]. - The company completed the 2021-FL1 CLO, issuing $903.8 million in total CLO notes, with $833.8 million being investment grade[250]. - On July 12, 2023, the company secured $386.4 million in financing through LMF 2023-1 Financing, with a weighted average spread of approximately 314 basis points over 30-day term SOFR[251]. - As of September 30, 2025, the principal value of collateralized loan obligations was $836.1 million, with a carrying value of $819.1 million and a weighted average coupon of 7.77%[252]. Real Estate Owned (REO) and Credit Losses - The company has a total of $59,469,749 in real estate owned across various multifamily properties[217]. - At September 30, 2025, the company's Real Estate Owned (REO) assets totaled $49.3 million for held-for-investment properties and $8.9 million for held-for-sale properties[241]. - The weighted average occupancy rate of the company's REO properties was approximately 73.5% as of September 30, 2025[245]. - The allowance for credit losses as of September 30, 2025, was $14,020,408, impacting the carrying value of loans held-for-investment[212][214]. - The company identified a loan in Colorado Springs, CO, with an unpaid principal value of $10.3 million requiring a specific allowance for credit losses of $1.3 million[221]. - The company reported no impaired loans, non-accrual loans, or loans in maturity default other than the identified loan as of September 30, 2025[220]. - The company identified a loan in Tallahassee, FL, with an unpaid principal value of $17.0 million, requiring a specific allowance for credit losses of $2.9 million due to monetary default[227]. - The company continues to work with borrowers to address issues as they arise while seeking to preserve the credit attributes of its loans[238]. - The company incurred management and incentive fees of $3,515,799 for the nine months ended September 30, 2025, a decrease from $5,507,768 in 2024[290]. Dividends and Liquidity - The company intends to continue making regular quarterly distributions to common stockholders, with a cash dividend rate of $0.04 per share for Q3 2025 declared on September 16, 2025[315]. - The company has historically made regular monthly distributions but switched to quarterly distributions starting from Q3 2018[314]. - If taxable income is not fully paid by year-end, the company may declare a special dividend to meet distribution requirements[315]. - The company believes that net proceeds from prior equity sales, combined with cash flow from operations and available borrowing capacity, will be sufficient to meet anticipated short-term liquidity requirements[308]. - Long-term liquidity and capital resource requirements will depend on obtaining additional debt financing and equity capital, including long-term credit facilities and public or private offerings of equity or debt securities[309]. - To maintain REIT qualification, the company must distribute at least 90% of its "REIT taxable income," limiting its ability to retain earnings for operations[310]. - As of September 30, 2025, the company had unrestricted cash and cash equivalents of $56.0 million, down from $69.2 million as of December 31, 2024[301]. - The total debt to equity ratio was 3.1:1 on a GAAP basis as of September 30, 2025, with $669.8 million in non-recourse liabilities from consolidated CLOs[302].