Sachem Capital(SACH)2022-05-03 22:18Revenue and Income Growth - Revenue increased by 80.3% compared to Q1 2021, with interest income rising by 87.8% and origination fees increasing by 216.5%[126] - Total revenue for Q1 2022 was approximately $10.3 million, an increase of 80.3% from $5.7 million in Q1 2021[160] - Interest income for Q1 2022 was approximately $8.5 million, up 87.8% from $4.5 million in Q1 2021[160] - Origination fees increased to approximately $1.6 million in Q1 2022, representing a 216.5% increase from approximately $517,000 in Q1 2021[160] - Net income attributable to common shareholders rose by 57.1%, while earnings per share remained unchanged at $0.10[126] - Net income attributable to common shareholders for the three months ended March 31, 2022, was $3,429,700, up from $2,183,101 in the prior year[166] - Adjusted earnings attributable to common shareholders for the period ended March 31, 2022, were $4,481,930, compared to $2,183,101 for the same period in 2021, reflecting a significant increase[166] Assets and Liabilities - Total assets increased by approximately $63.8 million, or 15.3%, to approximately $481.8 million as of March 31, 2022, primarily due to an increase in the mortgage loan portfolio[168] - Total liabilities rose by approximately $44.5 million, or 18.7%, to approximately $282.4 million as of March 31, 2022, mainly due to an increase in notes payable[169] - Total shareholders' equity increased by approximately $19.3 million to approximately $199.4 million as of March 31, 2022, driven by net proceeds from the sale of common shares[170] Cash Flow - Net cash provided by operating activities for the three months ended March 31, 2022, was approximately $7.8 million, compared to $2.8 million for the same period in 2021[171] - Net cash used for investing activities increased significantly to approximately $48.7 million for the three months ended March 31, 2022, compared to $2.1 million in the prior year[172] - Net cash provided by financing activities for the three months ended March 31, 2022, was approximately $56.8 million, a substantial increase from $1.8 million used in the comparable 2021 period[174] Loan Portfolio and Underwriting - Mortgages receivable increased by 125.6% compared to March 31, 2021, and cash and cash equivalents rose by 215.4%[126] - As of March 31, 2022, the mortgage loan portfolio included 204 loans with future funding obligations totaling approximately $115.4 million, up from 129 loans totaling approximately $23.5 million a year earlier[138] - The yield on the mortgage loan portfolio decreased from 11.73% in Q1 2021 to 11.30% in Q1 2022, indicating interest rate compression[130] - The company has implemented a new underwriting model to automate loan documentation, enhancing processing accuracy and efficiency[127] - The company is focusing on larger-value commercial loans with experienced sponsors to drive growth and operational excellence[127] Debt and Financing - Debt represented approximately 55.5% of total capital as of March 31, 2022, down from 63.0% a year prior[140] - The outstanding balance under the Churchill Facility was approximately $26.9 million as of March 31, 2022, accruing interest at an effective rate of 4.70% per annum[145] - The Wells Fargo Loan had a balance of approximately $23.3 million at March 31, 2022, with an interest rate of 1.75% below the prime rate[146] - The NHB Mortgage had an outstanding amount of $750,000 as of December 31, 2021, with an initial interest rate of 3.75% per annum[147] Shareholder Distributions - The company aims to grow its loan portfolio while maintaining a minimum distribution of 90% of taxable income to qualify as a REIT[125] - The company intends to pay regular quarterly distributions to holders of common shares of not less than 90% of its REIT taxable income[177] - The company raised approximately $15.5 million from the sale of 2,730,725 common shares during the three months ended March 31, 2022[150] - The company raised approximately $45.5 million from the sale of 1,903,000 shares of Series A Preferred Stock in June and July 2021[148] Operating Expenses - Increased operating expenses were noted, primarily due to a higher debt load, increased headcount, and loan volume[137] - Total operating costs and expenses for Q1 2022 were approximately $5.9 million, an increase of 68.6% from $3.5 million in Q1 2021[161] Contractual Obligations - As of March 31, 2022, total contractual obligations amounted to approximately $119.2 million, including unfunded loan commitments of $115.4 million[185]