Lument Finance Trust(US:LFT)2020-08-10 17:08Financial Data and Key Metrics Changes - For Q2 2020, the company reported net income to common stockholders of $1.9 million, or $0.08 per share, compared to $1.5 million, or $0.06 per share in the prior quarter and $1.4 million, or $0.06 per share in Q2 2019, driven by an increase in net interest income [17][18] - Core earnings attributed to common stockholders for the quarter were $2.2 million or $0.09 per share, consistent with the prior quarter and Q2 2019 [18] - The book value at June 30 was $114 million or $4.57 per share, unchanged from Q1 2020 [19] Business Line Data and Key Metrics Changes - The portfolio consists of over 99% senior mortgage loans, with no exposure to mezzanine loans, construction loans, or loans backed by hotels, focusing primarily on multifamily assets [10][11] - During the quarter, the company made future funding advances on 11 loans totaling $3.4 million, all secured by multifamily assets, while experiencing $32.9 million in loan payoffs [24] Market Data and Key Metrics Changes - The company noted that bridge lending activity has shown positive movement with less transition risk and more moderate leverage compared to pre-COVID periods [9] - The overall loan portfolio at quarter end was over 90% multifamily, reflecting resilience during downturns [25] Company Strategy and Development Direction - The company is focused on proactive asset management and evaluating new investment opportunities, particularly in the multifamily sector, while remaining cautious due to market uncertainties [24][30] - The management expressed a desire to grow and expand financing sources, despite the challenges posed by the COVID-19 pandemic [46] Management's Comments on Operating Environment and Future Outlook - Management acknowledged the significant impact of COVID-19 on the economy and the lending market, but noted improvements in liquidity and credit market volatility [8][30] - The company remains optimistic about the future, actively monitoring its portfolio and the broader economic environment [30] Other Important Information - The company has not experienced any material adverse liquidity events due to COVID-19 and believes its liquidity position is sufficient [13] - The Q2 2020 dividend of $0.075 per share was paid on July 15, with a decision on Q3 2020 dividends expected in September [14] Q&A Session Summary Question: Plans for cash from repayments and distributions - Management clarified that repayments are being used to sequentially pay down bonds, resulting in a slight reduction in overall leverage [35][36] Question: Expectation of asset volume decline in H2 - Management indicated that a decline in asset volumes is more likely than not due to de-leveraging [54] Question: Impact of rent regulations on landlords - Management acknowledged pressures from rent regulations in various states and emphasized the need for balance between property owners and tenants [59] Question: New opportunities in Q3 - Management confirmed ongoing discussions with borrowers about financing needs and identified opportunities in the bridge space despite current market conditions [65][66]