AFC Gamma(AFCG) - 2024 Q1 - Quarterly Results

First Quarter 2024 Financial Results AFC Gamma reported a GAAP net loss but strong Distributable Earnings in Q1 2024, driven by new loan originations and a consistent dividend payout Financial Highlights For the first quarter of 2024, AFC Gamma reported a GAAP net loss of $(0.1) million, or $(0.01) per share, alongside non-GAAP Distributable Earnings of $10.0 million, or $0.49 per share Q1 2024 Key Financial Metrics | Metric | Value | Per Share (Basic) | | :--- | :--- | :--- | | GAAP Net Loss | $(0.1) million | $(0.01) | | Distributable Earnings (Non-GAAP) | $10.0 million | $0.49 | Operational and Strategic Highlights The company originated $90.4 million in new loans during the first quarter, diversified between cannabis operators and commercial real estate developers, while anticipating legislative reforms - Total loan originations in Q1 2024 amounted to $90.4 million, comprising $34.0 million to cannabis operators and $56.4 million to commercial real estate developers[2] - Completed a $34.0 million debt investment in Sunburn Cannabis, a private, vertically integrated operator in Florida[2] - The company is encouraged by promising legislative developments, including anticipated federal rescheduling of cannabis and potential adult-use legalization in states like Ohio and Florida[2] Common Stock Dividend AFC Gamma declared and paid a cash dividend of $0.48 per common share for Q1 2024, with the total distribution of $9.9 million covered by Distributable Earnings Q1 2024 Dividend Information | Metric | Value | | :--- | :--- | | Dividend per Common Share | $0.48 | | Total Dividends Distributed | $9.9 million | | Payment Date | April 15, 2024 | - The dividend of $0.48 per share is covered by the Distributable Earnings of $0.49 per basic weighted average common share for the same period[3] Non-GAAP Financial Measures The company utilizes "Distributable Earnings," a non-GAAP metric, to assess performance by excluding certain non-cash items and GAAP adjustments, providing a useful indicator for dividend capacity Definition and Rationale Distributable Earnings adjusts GAAP net income by excluding items such as stock-based compensation, unrealized gains/losses, and CECL changes, offering a clearer view of core loan activity and operational performance - Distributable Earnings is used internally and by management to evaluate performance, excluding certain GAAP adjustments not considered indicative of current loan operations[9] - Key adjustments to GAAP net income include excluding: stock-based compensation, unrealized gains/losses, increase in provision for CECL, and TRS (taxable REIT subsidiary) income/loss[10] - As a REIT, the company aims to pay dividends at least equal to its taxable income, and Distributable Earnings is considered a useful indicator for its dividend policy[11] Reconciliation of GAAP Net (loss) income to Distributable Earnings For Q1 2024, AFC Gamma reconciled a GAAP net loss of $(54,116) to Distributable Earnings of $9,965,706, or $0.49 per share, a decrease from Q1 2023 Reconciliation of GAAP Net (Loss) Income to Distributable Earnings (in USD) | Metric | Q1 2024 | Q1 2023 | | :--- | :--- | :--- | | Net (loss) income (GAAP) | $(54,116) | $10,025,274 | | Stock-based compensation expense | $543,222 | $280,578 | | Unrealized (gains) losses | $3,613,693 | $1,477,691 | | Increase in provision for CECL | $4,931,674 | $702,426 | | TRS (income) loss, net of dividends | $931,233 | $(866,204) | | Distributable earnings (Non-GAAP) | $9,965,706 | $11,619,765 | | Distributable earnings per share | $0.49 | $0.57 | Company and Investor Information This section provides an overview of AFC Gamma's business, details for investor communications, and standard forward-looking statement disclaimers About AFC Gamma AFC Gamma is a publicly-traded institutional lender specializing in direct and bridge loans secured by commercial real estate, with a focus on state-compliant cannabis operators - AFC Gamma is an institutional lender (NASDAQ:AFCG) that originates, structures, and underwrites loans secured by commercial real estate[8] - The company focuses on direct lending and bridge loans, typically from $10 million to $100 million, specializing in the state-compliant cannabis sector[8] Conference Call & Discussion of Financial Results AFC Gamma scheduled a conference call for May 9, 2024, to discuss its first-quarter financial results, with a live audio webcast and archive available online - A conference call to discuss Q1 2024 financial results was scheduled for 10:00 am (Eastern Time) on Thursday, May 9, 2024[6] - Details for participation via webcast or telephone were provided, with the webcast to be archived for 90 days on the company's website[6][7] Forward-Looking Statements This section contains a standard safe harbor statement, cautioning that the press release includes forward-looking statements subject to inherent uncertainties and risks, with no obligation to update - The release contains forward-looking statements that are not guarantees of future performance and are subject to inherent risks and uncertainties[16] - Investors are directed to the company's SEC filings, including Forms 10-K and 10-Q, for more information on potential risks that could affect financial results[16] Investor Relations The document provides specific contact information for both investor and media inquiries directed at AFC Gamma - Contact information is provided for both AFC Gamma Investor Relations and Media Relations[18]