Lument Finance Trust (LFT) Q1 2025 Earnings Call May 13, 2025 08:30 AM ET Company Participants Andrew Tsang - MD - Corporate DevelopmentJames Flynn - CEOJames Briggs - Chief Financial OfficerGreg Calvert - PresidentJason Weaver - Managing Director - Equity ResearchChristopher Nolan - SVP - Equity Research Conference Call Participants Steven Delaney - Analyst Operator Good morning, and thank you for joining the Lumet Finance Trust First Quarter twenty twenty five Earnings Call. Today's call is being recorded ...

Lument Finance Trust (LFT) Q1 2025 Earnings Call May 13, 2025 08:30 AM ET Speaker0 Good morning, and thank you for joining the Lumet Finance Trust First Quarter twenty twenty five Earnings Call. Today's call is being recorded and will be made available via webcast on the company's website. I would now like to turn the call over to Andrew Tsong with Investor Relations at Lumen Investment Management. Please go ahead. Speaker1 Good morning, everyone. Thank you for joining our call to discuss Lumen Finance Trus ...

Financial Data and Key Metrics Changes - Apollo Commercial Real Estate Finance reported distributable earnings of $33 million or $0.24 per share for Q1 2025, with GAAP net income of $23 million or $0.16 per diluted share, providing 96% coverage of the quarterly dividends [15][16] - The loan portfolio ended the quarter with a carrying value of $7.7 billion, up from $7.1 billion at year-end, with a weighted average yield of 7.9% [17][19] - The debt-to-equity ratio at quarter end was 3.5x, up from 3.2x at year-end, reflecting the recirculation of proceeds from repayments into new leveraged deals [22] Business Line Data and Key Metrics Changes - The first quarter saw continued velocity in loan originations, with $650 million of new loans committed, primarily secured by residential properties and a data center construction loan [9][10] - Loan repayments totaled $93 million during the quarter, which were quickly redeployed through new origination post-quarter end, amounting to $709 million in total commitments on new loans in Q2 to date [18][20] Market Data and Key Metrics Changes - The real estate market is experiencing modest spread widening and a more cautious tone, with a broad recession presenting the greatest risk to ongoing recovery [7][8] - Limited new supply due to tariff effects driving up construction costs is expected to positively impact long-term real estate values and fundamentals [8] Company Strategy and Development Direction - The company is focused on proactive asset management and executing plans on focus loans to maximize value recovery and convert capital into higher return opportunities [13] - The strategy includes financing developers of data centers with strong credit tenants and long-term leases, reflecting a commitment to sectors with strong secular tailwinds [10][11] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the loan portfolio's ability to produce distributable earnings that support the current quarterly dividend run rate, despite Q1 earnings being slightly below this rate [14][16] - The company anticipates a recovery in distributable earnings for the remaining quarters of 2025, driven by growth in the loan portfolio and recirculation of underperforming capital [16] Other Important Information - The company has defined pathways for each focus asset and is actively pursuing resolutions, with a focus on selling the Liberty Center asset in the latter part of the year [28] - The company ended the quarter with $218 million of total liquidity, comprised of cash on hand and committed undrawn credit capacity [22] Q&A Session Summary Question: Concerns about realizing losses on non-accruing assets - Management indicated that specific CECL allowances are tied to two assets, with plans to sell Liberty Center later this year and positive sales momentum for 111 West 57th Street [26][28] Question: Market impacts on loan repayments and new money deployment - Management noted that the market remains robust, with no anticipated slowdown in transactions despite recent volatility [34][36] Question: Updates on specific assets and portfolio growth - Management provided updates on various assets, indicating positive leasing activity and potential recapitalization strategies for the Manhattan office [56][63] Question: Exposure in the U.K. and Europe - Management explained that the company's European operations were established through relationships with U.S. sponsors and have developed a strong presence in the market over the past decade [87][90]

Financial Data and Key Metrics Changes - Apollo Commercial Real Estate Finance reported distributable earnings of $33 million or $0.24 per share for Q1 2025, with GAAP net income of $23 million or $0.16 per diluted share, providing 96% coverage of the quarterly dividend [12][16] - The loan portfolio increased to $7.7 billion from $7.1 billion at year-end, with a weighted average yield of 7.9% [13][16] - The debt to equity ratio at quarter-end was 3.5 times, up from 3.2 times at year-end [16] Business Line Data and Key Metrics Changes - The company committed to $650 million in new loans during Q1, with a total of $1.5 billion in year-to-date volume including add-on fundings [8][9] - Loan repayments totaled $93 million during the quarter, which were redeployed through new originations [13] Market Data and Key Metrics Changes - The real estate market is experiencing significant capital availability despite increased volatility, with a cautious tone emerging due to macroeconomic concerns [5][6] - Construction starts for multifamily and logistics properties are at ten-year lows, indicating limited supply which is expected to support long-term real estate values [6][7] Company Strategy and Development Direction - The company is focused on proactive asset management and maximizing value recovery from its loan portfolio [11] - There is a strategic emphasis on financing data centers and residential properties, which are expected to perform well even in recessionary scenarios [8][9] Management's Comments on Operating Environment and Future Outlook - Management expressed concerns about a potential broad recession being the greatest risk to the ongoing real estate recovery, but noted that real estate is better positioned than many other asset classes [5][7] - The company anticipates that Q1 results represent a trough, with expectations for distributable earnings to meet or exceed the quarterly dividend rate for the remaining quarters of 2025 [12][13] Other Important Information - The company has a strong pipeline of transactions in both the U.S. and Europe, with continued activity in loan originations [8][9] - The update on 111 West 50 Seventh Street indicated strong sales momentum, generating $35 million in net proceeds from unit closings [10] Q&A Session Summary Question: Concerns about realizing losses and redeploying capital - Management indicated that specific CECL allowances are tied to two assets, with plans to sell the Liberty Center asset later this year, which should help crystallize losses and allow for capital redeployment [19][20] Question: Market conditions affecting loan repayments and new money deployment - Management noted that the market remains robust, with no anticipated slowdown in transactions despite recent volatility [25][26] Question: Portfolio growth and repayment expectations - Management expects approximately $1.5 billion in repayments this year, with active market participation anticipated [34] Question: Performance of specific assets - Management provided updates on various assets, indicating positive leasing activity and potential for improved risk ratings [40][41][44][46] Question: Exposure in the UK and Europe - Management explained the company's established presence in Europe, highlighting a dedicated team and strong relationships that facilitate successful operations in the region [64][66]

Financial Data and Key Metrics Changes - In Q1 2025, the company generated distributable earnings of $25.5 million, or $0.20 per share, with a return on equity of 6.6% and adjusted leverage of 1.4 times [5][21] - As of March 31, 2025, the company's liquidity stood at $1.3 billion, including $480 million in cash and cash equivalents, with 83% of total assets unencumbered [10][21] - The company's total gross leverage was 1.83 times, with 72% of debt comprised of unsecured corporate bonds [22][24] Business Line Data and Key Metrics Changes - The company originated $329 million in new loans and acquired $521 million in AAA securities in Q1 2025, totaling over $800 million in investment activity [7][12] - The loan portfolio as of March 31, 2025, was $1.7 billion, representing 38% of total assets, with a weighted average yield of 8.7% [11][28] - The real estate portfolio generated $12.2 million of net operating income during Q1 2025, primarily consisting of net leased properties [15][30] Market Data and Key Metrics Changes - 74% of new loan originations in Q1 2025 were backed by multi-family or industrial assets [13][50] - The company expects muted payoffs for the remainder of the year due to strong payoffs achieved in 2024 [13] Company Strategy and Development Direction - The company aims to redeploy liquidity generated from loan payoffs into new loans that better reflect current market conditions [6][9] - The strategy includes a shift towards unsecured debt as the primary funding source, with a focus on maintaining a robust balance sheet and high credit ratings [10][11][24] - The company is prepared to navigate market volatility and capitalize on opportunities with the best risk-adjusted returns [18] Management's Comments on Operating Environment and Future Outlook - Management acknowledges the potential for market volatility and uncertainty but remains optimistic about the company's liquidity and balance sheet strength [8][9] - The company anticipates attractive opportunities arising from the current economic environment, particularly in conduit securitizations [40] Other Important Information - The company has a CECL reserve of $52 million, which is deemed sufficient to cover potential losses in the loan portfolio [14][28] - The company repurchased $20 million in principal value of unsecured bonds during Q1 2025 and declared a $0.23 per share dividend [26][27] Q&A Session Summary Question: Regarding origination activity and spreads - The company noted that the blended spread of 394 basis points was influenced by market volatility, with expectations for continued opportunities in the high 300s range [44][49] Question: Expectations for origination pace - Management expects origination to exceed the pace set in Q1 2025, despite some slowdown in securitizations due to market volatility [56][61] Question: Long-term views on the net lease portfolio - The company is open to holding or selling properties based on market conditions, with no active attempts to sell but willing to grow the portfolio [63][67] Question: Outlook on interest rates and their impact - Management anticipates a steeper yield curve, with expectations for the 10-year treasury yield to rise, which could create opportunities for the company [72][77] Question: Asset allocation and future mix - The company does not have a fixed game plan for asset allocation but aims to maintain liquidity while adjusting to market conditions [90][92]

Ladder Capital (LADR) Q1 2025 Earnings Call April 24, 2025 10:00 AM ET Company Participants Pamela McCormack - PresidentPaul Miceli - Chief Financial OfficerBrian Harris - Founder, CEO & DirectorRandy Binner - Managing DirectorJade Rahmani - Managing DirectorSteve Delaney - Director of MortgageJohn Nickodemus - Vice President, Equity Research Operator Good morning, and welcome to Ladder Capital Corp. Earnings Call for the First Quarter of twenty twenty five. As a reminder, today's call is being recorded. Th ...

Ladder Capital (LADR) Q4 2024 Earnings Call February 06, 2025 10:00 AM ET Company Participants Pamela McCormack - Founder & PresidentPaul Miceli - CFOBrian Harris - Founder and CEOJade Rahmani - Managing DirectorThomas Catherwood - MD & REITs Equity ResearchSteve Delaney - Director of Mortgage Operator Good morning and welcome to Ladder Capital Corp's Earnings Call for the Fourth Quarter of twenty twenty four. As a reminder, today's call is being recorded. This morning, Ladder released its financial results ...