Ladder Capital(US:LADR)2022-04-29 23:56Financial Performance - Net income for the three months ended March 31, 2022, was $19.2 million, a decrease of $7.9 million compared to $27.1 million for the previous quarter [288]. - Distributable earnings for the three months ended March 31, 2022, totaled $31.5 million, up from $27.7 million in the previous quarter, reflecting a $7.6 million increase in real estate sales [289]. - The net income for the three months ended March 31, 2022, was $19.2 million, a significant increase from $0.4 million for the same period in 2021 [316]. - Distributable earnings totaled $31.5 million for the three months ended March 31, 2022, compared to $3.2 million for the same period in 2021, reflecting a $28.3 million increase [317]. - Total other income increased by $16.1 million to $65.2 million, driven by a $10.5 million increase in realized gain on sale of real estate and a $4.4 million increase in fee and other income [290]. Assets and Investments - As of March 31, 2022, total assets amounted to $6.0 billion, with total equity at $1.5 billion [234]. - Ladder Capital's total investments reached $5.4 billion, representing 90.4% of total assets as of March 31, 2022 [238]. - The company held a portfolio of 143 balance sheet first mortgage loans with an aggregate book value of $3.8 billion, with a weighted average loan-to-value ratio of 68.2% [240]. - As of March 31, 2022, Ladder Capital owned 158 single tenant net leased properties valued at $520.3 million, with 100% of rent collected during the three months ended March 31, 2022 [246]. - The company has invested $12.9 billion in predominantly investment grade-rated securities secured by first mortgage loans on commercial real estate [232]. Debt and Borrowings - As of March 31, 2022, the company had $1.6 billion of unsecured corporate bonds outstanding, including $348.0 million in 5.25% senior notes due 2025, $651.8 million in 4.25% senior notes due 2027, and $650.0 million in 4.75% senior notes due 2029 [257]. - Total debt obligations as of March 31, 2022, were $4.34 billion, including senior unsecured notes of $1.63 billion and CLO debt of $1.06 billion [365]. - The company had $412.3 million of borrowings outstanding under committed loan repurchase facilities, with an additional $0.9 billion of committed financing available [368]. - The company had $1.1 billion of matched term, non-mark-to-market and non-recourse CLO debt included in its debt obligations as of March 31, 2022 [261]. - The company generally seeks to maintain a debt-to-equity ratio of approximately 3.0:1.0 or below, with expectations of fluctuations due to business operations [278]. Cash Flow - Net cash used in operating activities for the three months ended March 31, 2022, was $(30.0) million, driven by $(54.8) million of mortgage loan originations held for sale [353]. - Net cash provided by financing activities was $75.6 million, resulting from net borrowings of $115.4 million, partially offset by $(26.1) million in dividend payments [355]. - Net cash provided by investing activities was $688.7 million, driven by $394.4 million in mortgage loan receivables repayment and $329.1 million from the sale of real estate securities [358]. - Net cash used in financing activities amounted to $(477.4) million, primarily due to net borrowings of $(445.6) million and $26.2 million in dividend payments [359]. - The company held cash, cash equivalents, and restricted cash of $495.2 million as of March 31, 2022, with $431.8 million being unrestricted [349]. Loan and Securities Management - The company originated and funded $703.4 million in commercial mortgage loans during the three months ended March 31, 2022, offset by $349.9 million in principal repayments [286]. - The weighted average yield on mortgage loan receivables was 5.4% as of March 31, 2022, down from 5.7% as of December 31, 2021 [294]. - The company recorded a $16.9 million increase in interest income for the three months ended March 31, 2022, attributed to increased net originations and higher prevailing rate benchmarks [319]. - The company had outstanding borrowings secured by mortgage loan receivables equal to 40.7% of their carrying value as of March 31, 2022, up from 39.0% as of December 31, 2021 [294]. - The company acquired $29.8 million in new securities during the three months ended March 31, 2022, contributing to a net decrease in the securities portfolio of $40.3 million [286]. Risk Management and Provisions - The total provision for loan loss reserves increased by $0.9 million for the three months ended March 31, 2022, due to a $0.6 million increase in general reserves and a $0.3 million increase related to unfunded loan commitments [297]. - The estimated provision for loan losses increased to $33.1 million at March 31, 2022, compared to $32.2 million at December 31, 2021 [422]. - The provision for loan losses for the three months ended March 31, 2022, was $0.9 million, while the allowance for loan losses stood at $32.3 million [423]. - The company evaluates loans for impairment at least quarterly, with impairment occurring when it is probable that the company will not collect all amounts due [417]. - The company utilizes a current expected credit loss model (CECL) for estimating loan loss provisions, which includes both portfolio-based and asset-specific components [416]. Management and Governance - Ladder Capital's management team holds over 10% of the company's total equity, with an average of 26 years of industry experience [236]. - The Company intends to declare regular quarterly distributions to its shareholders approximating at least 90% of the REIT's annual net taxable income [397]. - Approximately $1.2 billion of Tuebor's member's capital was restricted from transfer via dividend to Tuebor's parent without prior approval of state insurance regulators [387]. - The company has no known material cash requirements beyond its contractual obligations and unfunded commitments [409]. - The company had two properties classified as held for sale at March 31, 2022, and did not record any impairments for the three months ended March 31, 2022 [427].