New York Mortgage Trust Reports Fourth Quarter and Full Year 2023 Results


NEW YORK, Feb. 21, 2024 (GLOBE NEWSWIRE) -- New York Mortgage Trust, Inc. (Nasdaq: NYMT) (“NYMT,” the “Company,” “we,” “our” or “us”) today reported results for the three and twelve months ended December 31, 2023.

Summary of Fourth Quarter and Full Year 2023:
(dollar amounts in thousands, except per share data)

 For the Three
Months Ended
December 31,
2023
(1)
 For the Twelve
Months Ended
December 31,
2023
(1)
Net income (loss) attributable to Company's common stockholders$31,465   $(90,035) 
Net income (loss) attributable to Company's common stockholders per share (basic)$0.35   $(0.99) 
Undepreciated earnings (loss) (2)$33,697   $(81,321) 
Undepreciated earnings (loss) per common share (2)$0.37   $(0.89) 
Comprehensive income (loss) attributable to Company's common stockholders$33,288   $(88,069) 
Comprehensive income (loss) attributable to Company's common stockholders per share (basic)$0.37   $(0.97) 
Yield on average interest earning assets (2) (3) 6.21 %  6.14 %
Interest income$78,789   $258,660  
Interest expense$61,989   $192,134  
Net interest income$16,800   $66,526  
Net interest spread (2) (4) 1.02 %  0.74 %
Book value per common share at the end of the period$11.31   $11.31  
Adjusted book value per common share at the end of the period (2)$12.66   $12.66  
Economic return on book value (5) 2.22 % (5.73)%
Economic return on adjusted book value (6)(0.54)% (12.78)%
Dividends per common share$0.20   $1.20  

 

(1)For all periods presented, all per common share amounts and common shares outstanding have been adjusted to reflect the Company’s one-for-four reverse stock split which was effected on March 9, 2023.
(2)Represents a non-GAAP financial measure. A reconciliation of the Company's non-GAAP financial measures to their most directly comparable GAAP measure is included below in "Reconciliation of Financial Information."
(3)Calculated as the quotient of our adjusted interest income and our average interest earning assets and excludes all Consolidated SLST assets other than those securities owned by the Company.
(4)Our calculation of net interest spread may not be comparable to similarly-titled measures of other companies who may use a different calculation.
(5)Economic return on book value is based on the periodic change in GAAP book value per common share plus dividends declared per common share, if any, during the period.
(6)Economic return on adjusted book value is based on the periodic change in adjusted book value per common share, a non-GAAP financial measure, plus dividends declared per common share, if any, during the period.


Key Developments:

Fourth Quarter 2023

  • Purchased approximately $416.4 million of Agency RMBS and approximately $237.7 million in residential loans.

  • Sold investment securities for approximately $39.3 million in proceeds.

  • Received approximately $29.8 million in proceeds from the redemption of a Mezzanine Lending investment.

  • Renewed and amended repurchase agreements for residential loans and single-family rental properties with existing counterparties increasing maximum aggregate purchase price to $2.2 billion.

  • Suspended the marketing of nine multi-family properties held by joint venture equity investments that were in disposal group held for sale primarily due to unfavorable market conditions and a lack of transactional activity in the multi-family market which resulted in a loss upon reclassification of these investments from disposal group held for sale to held and used of approximately $16.2 million.

Full Year 2023 Investing Activities

  • Purchased approximately $2.0 billion of Agency RMBS and approximately $620.3 million in residential loans.

  • Sold investment securities for approximately $64.7 million in proceeds and residential loans for approximately $25.1 million in proceeds.

  • Funded approximately $55.9 million of Mezzanine Lending investments. Received approximately $94.6 million in proceeds from redemptions of Mezzanine Lending investments.

  • Sold five multi-family properties held by joint venture equity investments representing total net equity investments of $43.2 million.

  • Repurchased $59.9 million par value of our residential loan securitization CDOs for approximately $58.4 million.

  • Recognized $89.5 million of impairment losses due to declines in estimated fair value of multi-family properties held by joint venture equity investments in disposal group held for sale driven by wider cap rates and lower net operating income at the properties.

Full Year 2023 Financing Activities

  • Obtained approximately $84.9 million of financing for residential loans through a repurchase agreement with a new counterparty.

  • Obtained approximately $74.3 million of financing for single-family rental properties through a repurchase agreement with an existing counterparty.

  • Effected a one-for-four reverse stock split of our issued, outstanding and authorized shares of common stock.

  • Announced upsize of common stock repurchase program to $246.0 million and authorized preferred stock repurchase program under which the Company may repurchase up to $100.0 million of the Company’s preferred stock.

  • Repurchased 937,850 shares of common stock pursuant to common stock repurchase program for approximately $8.6 million at an average repurchase price of $9.19 per common share and 120,580 shares of preferred stock pursuant to preferred stock repurchase program for approximately $2.4 million at an average repurchase price of $20.29 per preferred share.

Subsequent Developments

  • Completed a securitization of business purpose loans, resulting in approximately $223.2 million in net proceeds to us after deducting estimated expenses associated with the transaction. We utilized the net proceeds to repay approximately $136.6 million on outstanding repurchase agreements related to residential loans.

  • On February 21, 2024, we announced that our Board of Directors approved extensions of our common stock repurchase program, under which $193.2 million of the approved amount remained available for repurchase, and our preferred stock repurchase program, under which $97.6 million of the approved amount remained available for repurchase. The expiration dates of both stock repurchase programs were extended from March 31, 2024 to March 31, 2025.

Management Overview

Jason Serrano, Chief Executive Officer, commented: “The end of an economic cycle often generates heightened macroeconomic volatility as we approach inflection points in the market. Over the past few months, market developments may be illustrative of these trends. Volatility was high in the latter half of last year, then shifted lower as the Fed pivoted to a more dovish stance at the end of 2023. However, as 2024 began, longer-term Treasury yields rose, accompanied by a shift in the intermediate yield curve towards a more positive slope due to renewed inflation concerns.

A prevailing issue confounding rate expectations arises from U.S. government deficit spending that has failed to subside to sustainable levels. An increased U.S. debt burden has the potential to crowd out market investment activity. In addition, a dislocated commercial real estate market with approximately $2.8 trillion of loans maturing over the next four years presents significant challenges, particularly for banks. Liquidity in the credit markets has the potential to become strained pushing out the return horizon for investors and providing more attractive entry points at higher returns for NYMT.

In hindsight, the past decision to reduce portfolio risk and increase liquidity turned out to be premature and consequently lowered Company earnings throughout 2023. However, we believe this approach will yield improved results not only this year, but has the potential to enhance results in the years ahead as trillions of dollars of maturing commercial real estate debt is sorted out.”

Capital Allocation

The following table sets forth, by investment category, our allocated capital at December 31, 2023 (dollar amounts in thousands):

 Single-Family (1) Multi-
Family
 Corporate/Other Total
Residential loans$3,084,303  $  $  $3,084,303 
Consolidated SLST CDOs (593,737)        (593,737)
Investment securities available for sale 2,013,817         2,013,817 
Multi-family loans    95,792      95,792 
Equity investments    109,962   37,154   147,116 
Equity investments in consolidated multi-family properties (2)    211,214      211,214 
Equity investments in disposal group held for sale (3)    36,815      36,815 
Single-family rental properties 151,885         151,885 
Total investment portfolio carrying value 4,656,268   453,783   37,154   5,147,205 
Liabilities:       
Repurchase agreements (2,471,113)        (2,471,113)
Residential loan securitization CDOs (1,276,780)        (1,276,780)
Senior unsecured notes       (98,111)  (98,111)
Subordinated debentures       (45,000)  (45,000)
Cash, cash equivalents and restricted cash (4) 139,562      175,468   315,030 
Cumulative adjustment of redeemable non-controlling interest to estimated redemption value    (30,062)     (30,062)
Other 74,716   (1,352)  (34,921)  38,443 
Net Company capital allocated$1,122,653  $422,369  $34,590  $1,579,612 
        
Company Recourse Leverage Ratio (5)       1.6x
Portfolio Recourse Leverage Ratio (6)       1.5x


(1)The Company, through its ownership of certain securities, has determined it is the primary beneficiary of Consolidated SLST and has consolidated the assets and liabilities of Consolidated SLST in the Company’s consolidated financial statements. Consolidated SLST is primarily presented on our consolidated balance sheets as residential loans, at fair value and collateralized debt obligations, at fair value. Our investment in Consolidated SLST as of December 31, 2023 was limited to the RMBS comprised of first loss subordinated securities and certain IOs issued by the securitization with an aggregate net carrying value of $157.2 million.
(2)Represents the Company's equity investments in consolidated multi-family properties that are not in disposal group held for sale. See "Reconciliation of Financial Information" section below for a reconciliation of equity investments in consolidated multi-family properties and disposal group held for sale to the Company's consolidated financial statements.
(3)Represents the Company's equity investments in consolidated multi-family properties that are held for sale in disposal group. See "Reconciliation of Financial Information" section below for a reconciliation of equity investments in consolidated multi-family properties and disposal group held for sale to the Company's consolidated financial statements.
(4)Excludes cash in the amount of $21.3 million held in the Company's equity investments in consolidated multi-family properties and equity investments in consolidated multi-family properties in disposal group held for sale. Restricted cash of $143.5 million is included in the Company's accompanying consolidated balance sheets in other assets.
(5)Represents the Company's total outstanding recourse repurchase agreement financing, subordinated debentures and senior unsecured notes divided by the Company’s total stockholders’ equity. Does not include non-recourse repurchase agreement financing amounting to $149.7 million, Consolidated SLST CDOs amounting to $593.7 million, residential loan securitization CDOs amounting to $1.3 billion and mortgages payable on real estate, including mortgages payable on real estate of disposal group held for sale, totaling $1.2 billion as they are non-recourse debt.
(6)Represents the Company's outstanding recourse repurchase agreement financing divided by the Company’s total stockholders’ equity.


The following table sets forth certain information about our interest earning assets by category and their related adjusted interest income, adjusted interest expense, adjusted net interest income, yield on average interest earning assets, average financing cost and net interest spread for the three months ended December 31, 2023 (dollar amounts in thousands):

Three Months Ended December 31, 2023

 Single-Family (8) Multi-
Family
 Corporate/Other Total
Adjusted Interest Income (1) (2)$69,851  $2,670  $  $72,521 
Adjusted Interest Expense (1) (45,518)     (3,512)  (49,030)
Adjusted Net Interest Income (1)$24,333  $2,670  $(3,512) $23,491 
        
Average Interest Earning Assets (3)$4,569,863  $99,509  $1,000  $4,670,372 
Average Interest Bearing Liabilities (4)$3,526,749  $  $219,739  $3,746,488 
        
Yield on Average Interest Earning Assets (1) (5) 6.11%  10.65%     6.21%
Average Financing Cost (1) (6)(5.12)%    (6.34)% (5.19)%
Net Interest Spread (1) (7) 0.99%  10.65% (6.34)%  1.02%


(1)Represents a non-GAAP financial measure. A reconciliation of the Company's non-GAAP financial measures to their most directly comparable GAAP measure is included below in "Reconciliation of Financial Information."
(2)Includes interest income earned on cash accounts held by the Company.
(3)Average Interest Earning Assets for the period include residential loans, multi-family loans and investment securities and exclude all Consolidated SLST assets other than those securities owned by the Company. Average Interest Earning Assets is calculated based on the daily average amortized cost for the period.
(4)Average Interest Bearing Liabilities for the period include repurchase agreements, residential loan securitization CDOs, senior unsecured notes and subordinated debentures and exclude Consolidated SLST CDOs and mortgages payable on real estate as the Company does not directly incur interest expense on these liabilities that are consolidated for GAAP purposes. Average Interest Bearing Liabilities is calculated based on the daily average outstanding balance for the period.
(5)Yield on Average Interest Earning Assets is calculated by dividing our annualized adjusted interest income relating to our portfolio of interest earning assets by our Average Interest Earning Assets for the respective periods.
(6)Average Financing Cost is calculated by dividing our annualized adjusted interest expense by our Average Interest Bearing Liabilities.
(7)Net Interest Spread is the difference between our Yield on Average Interest Earning Assets and our Average Financing Cost.
(8)The Company has determined it is the primary beneficiary of Consolidated SLST and has consolidated Consolidated SLST into the Company's consolidated financial statements. Our GAAP interest income includes interest income recognized on the underlying seasoned re-performing and non-performing residential loans held in Consolidated SLST. Our GAAP interest expense includes interest expense recognized on the Consolidated SLST CDOs that permanently finance the residential loans in Consolidated SLST and are not owned by the Company. We calculate adjusted interest income by reducing our GAAP interest income by the interest expense recognized on the Consolidated SLST CDOs and adjusted interest expense by excluding, among other things, the interest expense recognized on the Consolidated SLST CDOs, thus only including the interest income earned by the SLST securities that are actually owned by the Company in adjusted net interest income.


Conference Call

On Thursday, February 22, 2024 at 9:00 a.m., Eastern Time, New York Mortgage Trust's executive management is scheduled to host a conference call and audio webcast to discuss the Company’s financial results for the three and twelve months ended December 31, 2023. To access the conference call, please pre-register using this link. Registrants will receive confirmation with dial-in details. A live audio webcast of the conference call can be accessed via the Internet, on a listen-only basis, at the Investor Relations section of the Company's website at http://www.nymtrust.com or using this link. Please allow extra time, prior to the call, to visit the site and download the necessary software to listen to the Internet broadcast. A webcast replay link of the conference call will be available on the Investor Relations section of the Company’s website approximately two hours after the call and will be available for 12 months.

In connection with the release of these financial results, the Company will also post a supplemental financial presentation that will accompany the conference call on its website at http://www.nymtrust.com under the "Investors — Events and Presentations" section. Full year 2023 financial and operating data can be viewed in the Company’s Annual Report on Form 10-K for the year ended December 31, 2023, which is expected to be filed with the Securities and Exchange Commission on or about February 23, 2024. A copy of the Form 10-K will be posted at the Company’s website as soon as reasonably practicable following its filing with the Securities and Exchange Commission.

About New York Mortgage Trust

New York Mortgage Trust, Inc. is a Maryland corporation that has elected to be taxed as a real estate investment trust (“REIT”) for federal income tax purposes. NYMT is an internally-managed REIT in the business of acquiring, investing in, financing and managing primarily mortgage-related single-family and multi-family residential assets. For a list of defined terms used from time to time in this press release, see “Defined Terms” below.

Defined Terms

The following defines certain of the commonly used terms that may appear in this press release: “RMBS” refers to residential mortgage-backed securities backed by adjustable-rate, hybrid adjustable-rate, or fixed-rate residential loans; “Agency RMBS” refers to RMBS representing interests in or obligations backed by pools of residential loans guaranteed by a government sponsored enterprise (“GSE”), such as the Federal National Mortgage Association (“Fannie Mae”) or the Federal Home Loan Mortgage Corporation (“Freddie Mac”), or an agency of the U.S. government, such as the Government National Mortgage Association (“Ginnie Mae”); “ABS” refers to debt and/or equity tranches of securitizations backed by various asset classes including, but not limited to, automobiles, aircraft, credit cards, equipment, franchises, recreational vehicles and student loans; “non-Agency RMBS” refers to RMBS that are not guaranteed by any agency of the U.S. Government or any GSE; “IOs” refers collectively to interest only and inverse interest only mortgage-backed securities that represent the right to the interest component of the cash flow from a pool of mortgage loans; “POs” refers to mortgage-backed securities that represent the right to the principal component of the cash flow from a pool of mortgage loans; “CMBS” refers to commercial mortgage-backed securities comprised of commercial mortgage pass-through securities issued by a GSE, as well as PO, IO or mezzanine securities that represent the right to a specific component of the cash flow from a pool of commercial mortgage loans; “multi-family CMBS” refers to CMBS backed by commercial mortgage loans on multi-family properties; “CDO” refers to collateralized debt obligation and includes debt that permanently finances the residential loans held in Consolidated SLST and the Company's residential loans held in securitization trusts that we consolidate or consolidated in our financial statements in accordance with GAAP; “Consolidated SLST” refers to a Freddie Mac-sponsored residential loan securitization, comprised of seasoned re-performing and non-performing residential loans, of which we own the first loss subordinated securities and certain IOs, that we consolidate in our financial statements in accordance with GAAP; “Consolidated VIEs” refers to variable interest entities ("VIE") where the Company is the primary beneficiary, as it has both the power to direct the activities that most significantly impact the economic performance of the VIE and a right to receive benefits or absorb losses of the entity that could be potentially significant to the VIE and that we consolidate in our financial statements in accordance with GAAP; “Consolidated Real Estate VIEs” refers to Consolidated VIEs that own multi-family properties; “business purpose loans” refers to (i) short-term loans that are collateralized by residential properties and are made to investors who intend to rehabilitate and sell the residential property for a profit or (ii) loans that finance (or refinance) non-owner occupied residential properties that are rented to one or more tenants; “Mezzanine Lending” refers, collectively, to preferred equity and mezzanine loan investments; “Multi-Family” portfolio includes multi-family CMBS, Mezzanine Lending and certain equity investments in multi-family assets, including joint venture equity investments; “Single-Family” portfolio includes residential loans, Agency RMBS, non-Agency RMBS and single-family rental properties; and “Other” portfolio includes ABS and an equity investment in an entity that originates residential loans.

Cautionary Statement Regarding Forward-Looking Statements

When used in this press release, in future filings with the Securities and Exchange Commission (the “SEC”) or in other written or oral communications, statements which are not historical in nature, including those containing words such as “will,” “believe,” “expect,” “anticipate,” “estimate,” “plan,” “continue,” “intend,” “could,” “would,” “should,” “may” or similar expressions, are intended to identify “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and, as such, may involve known and unknown risks, uncertainties and assumptions.

Forward-looking statements are based on estimates, projections, beliefs and assumptions of management of the Company at the time of such statements and are not guarantees of future performance. Forward-looking statements involve risks and uncertainties in predicting future results and conditions. Actual results and outcomes could differ materially from those projected in these forward-looking statements due to a variety of factors, including, without limitation: changes in the Company’s business and investment strategy; inflation and changes in interest rates and the fair market value of the Company’s assets, including negative changes resulting in margin calls relating to the financing of the Company’s assets; changes in credit spreads; changes in the long-term credit ratings of the U.S., Fannie Mae, Freddie Mac, and Ginnie Mae; general volatility of the markets in which the Company invests; changes in prepayment rates on the loans the Company owns or that underlie the Company’s investment securities; increased rates of default, delinquency or vacancy and/or decreased recovery rates on or at the Company’s assets; the Company’s ability to identify and acquire targeted assets, including assets in its investment pipeline; the Company's ability to dispose of assets from time to time on terms favorable to it, including the disposition over time of its joint venture equity investments; changes in relationships with the Company’s financing counterparties and the Company’s ability to borrow to finance its assets and the terms thereof; changes in the Company's relationships with and/or the performance of its operating partners; the Company’s ability to predict and control costs; changes in laws, regulations or policies affecting the Company’s business; the Company’s ability to make distributions to its stockholders in the future; the Company’s ability to maintain its qualification as a REIT for federal tax purposes; the Company’s ability to maintain its exemption from registration under the Investment Company Act of 1940, as amended; impairments in the value of the collateral underlying the Company's investments; the Company's ability to manage or hedge credit risk, interest rate risk, and other financial and operational risks; the Company's exposure to liquidity risk, risks associated with the use of leverage, and market risks; and risks associated with investing in real estate assets, including changes in business conditions and the general economy, the availability of investment opportunities and the conditions in the market for Agency RMBS, non-Agency RMBS, ABS and CMBS securities, residential loans, structured multi-family investments and other mortgage-, residential housing- and credit-related assets.

These and other risks, uncertainties and factors, including the risk factors and other information described in the Company’s reports filed with the SEC pursuant to the Exchange Act, could cause the Company’s actual results to differ materially from those projected in any forward-looking statements the Company makes. All forward-looking statements speak only as of the date on which they are made. New risks and uncertainties arise over time and it is not possible to predict those events or how they may affect the Company. Except as required by law, the Company is not obligated to, and does not intend to, update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

For Further Information


FINANCIAL TABLES FOLLOW

NEW YORK MORTGAGE TRUST, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(Dollar amounts in thousands, except share data)

 December 31,
2023
 December 31,
2022
 (unaudited)  
ASSETS   
Residential loans, at fair value$3,084,303  $3,525,080 
Investment securities available for sale, at fair value 2,013,817   99,559 
Multi-family loans, at fair value 95,792   87,534 
Equity investments, at fair value 147,116   179,746 
Cash and cash equivalents 187,107   244,718 
Real estate, net 1,131,819   692,968 
Assets of disposal group held for sale 426,017   1,151,784 
Other assets 315,357   259,356 
Total Assets (1)$7,401,328  $6,240,745 
LIABILITIES AND EQUITY   
Liabilities:   
Repurchase agreements$2,471,113  $737,023 
Collateralized debt obligations ($593,737 at fair value and $1,276,780 at amortized cost,
    net as of December 31, 2023 and $634,495 at fair value and $1,468,222 at amortized
    cost, net as of December 31, 2022)
 1,870,517   2,102,717 
Senior unsecured notes 98,111   97,384 
Subordinated debentures 45,000   45,000 
Mortgages payable on real estate, net 784,421   394,707 
Liabilities of disposal group held for sale 386,024   883,812 
Other liabilities 118,016   115,991 
Total liabilities (1) 5,773,202   4,376,634 
    
Commitments and Contingencies    
    
Redeemable Non-Controlling Interest in Consolidated Variable Interest Entities 28,061   63,803 
    
Stockholders' Equity:   
Preferred stock, par value $0.01 per share, 31,500,000 shares authorized, 22,164,414 and
    22,284,994 shares issued and outstanding as of December 31, 2023 and December 31,
    2022, respectively ($554,110 and $557,125 aggregate liquidation preference as of
    December 31, 2023 and December 31, 2022, respectively)
 535,445   538,351 
Common stock, par value $0.01 per share, 200,000,000 shares authorized, 90,675,403 and
    91,193,688 shares issued and outstanding as of December 31, 2023 and December 31,
    2022, respectively
 907   912 
Additional paid-in capital 2,297,081   2,282,691 
Accumulated other comprehensive loss (4)  (1,970)
Accumulated deficit (1,253,817)  (1,052,768)
Company's stockholders' equity 1,579,612   1,767,216 
Non-controlling interests 20,453   33,092 
Total equity 1,600,065   1,800,308 
Total Liabilities and Equity$7,401,328  $6,240,745 


(1)Our consolidated balance sheets include assets and liabilities of consolidated variable interest entities ("VIEs") as the Company is the primary beneficiary of these VIEs. As of December 31, 2023 and December 31, 2022, assets of consolidated VIEs totaled $3,816,777 and $4,261,097, respectively, and the liabilities of consolidated VIEs totaled $3,076,818 and $3,403,257, respectively.


NEW YORK MORTGAGE TRUST, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(Amounts in thousands, except per share data)
(unaudited)

 For the Three Months
Ended

December 31,
 For the Twelve Months
Ended

December 31,
  2023   2022   2023   2022 
NET INTEREST INCOME:       
Interest income$78,789  $62,948  $258,660  $258,388 
Interest expense 61,989   40,651   192,134   129,419 
Total net interest income 16,800   22,297   66,526   128,969 
        
NET LOSS FROM REAL ESTATE:       
Rental income 33,630   35,514   141,057   126,293 
Other real estate income 9,231   3,900   30,717   15,363 
Total income from real estate 42,861   39,414   171,774   141,656 
Interest expense, mortgages payable on real estate 22,063   19,566   90,221   56,011 
Depreciation and amortization 6,249   5,910   24,620   126,824 
Other real estate expenses 21,356   20,884   88,235   72,400 
Total expenses related to real estate 49,668   46,360   203,076   255,235 
Total net loss from real estate (6,807)  (6,946)  (31,302)  (113,579)
        
OTHER INCOME (LOSS):       
Realized (losses) gains, net (24,839)  758   (27,059)  26,625 
Unrealized gains (losses), net 152,934   (43,932)  97,196   (347,363)
(Losses) gains on derivative instruments, net (64,582)  2,263   (26,378)  27,206 
Income from equity investments 8,562   4,018   17,785   15,074 
Impairment of real estate (18,252)  (2,449)  (89,548)  (2,449)
Loss on reclassification of disposal group (16,163)     (16,163)   
Other income 3,025   3,460   4,736   18,738 
Total other income (loss) 40,685   (35,882)  (39,431)  (262,169)
        
GENERAL, ADMINISTRATIVE AND OPERATING EXPENSES:       
General and administrative expenses 11,741   13,297   49,565   52,440 
Portfolio operating expenses 6,072   8,585   23,952   40,888 
Total general, administrative and operating expenses 17,813   21,882   73,517   93,328 
        
INCOME (LOSS) FROM OPERATIONS BEFORE INCOME TAXES 32,865   (42,413)  (77,724)  (340,107)
Income tax expense 134   804   75   542 
        
NET INCOME (LOSS) 32,731   (43,217)  (77,799)  (340,649)
Net loss attributable to non-controlling interests 9,177   5,635   29,134   42,044 
NET INCOME (LOSS) ATTRIBUTABLE TO COMPANY 41,908   (37,582)  (48,665)  (298,605)
Preferred stock dividends (10,443)  (10,494)  (41,837)  (41,972)
Gain on repurchase of preferred stock       467    
NET INCOME (LOSS) ATTRIBUTABLE TO COMPANY'S COMMON STOCKHOLDERS$31,465  $(48,076) $(90,035) $(340,577)
        
Basic earnings (loss) per common share$0.35  $(0.52) $(0.99) $(3.61)
Diluted earnings (loss) per common share$0.35  $(0.52) $(0.99) $(3.61)
Weighted average shares outstanding-basic 90,683   92,548   91,042   94,322 
Weighted average shares outstanding-diluted 91,189   92,548   91,042   94,322 



NEW YORK MORTGAGE TRUST, INC. AND SUBSIDIARIES
SUMMARY OF QUARTERLY EARNINGS (LOSS)
(Dollar amounts in thousands, except per share data)
(unaudited)

 For the Three Months Ended
 December 31,
2023
 September 30,
2023
 June 30,
2023
 March 31,
2023
 December 31,
2022
Interest income$78,789  $65,195  $57,540  $57,136  $62,948 
Interest expense 61,989   48,406   42,404   39,335   40,651 
Total net interest income 16,800   16,789   15,136   17,801   22,297 
Total net loss from real estate (6,807)  (7,788)  (7,755)  (8,951)  (6,946)
Total other income (loss) 40,685   (85,943)  (19,254)  25,081   (35,882)
Total general, administrative and operating expenses 17,813   16,987   18,965   19,753   21,882 
Income (loss) from operations before income taxes 32,865   (93,929)  (30,838)  14,178   (42,413)
Income tax expense (benefit) 134   (56)  (18)  16   804 
Net income (loss) 32,731   (93,873)  (30,820)  14,162   (43,217)
Net loss attributable to non-controlling interests 9,177   9,364   3,892   6,701   5,635 
Net income (loss) attributable to Company 41,908   (84,509)  (26,928)  20,863   (37,582)
Preferred stock dividends (10,443)  (10,435)  (10,474)  (10,484)  (10,494)
Gain on repurchase of preferred stock    125   200   142    
Net income (loss) attributable to Company's common stockholders 31,465   (94,819)  (37,202)  10,521   (48,076)
Basic earnings (loss) per common share$0.35  $(1.04) $(0.41) $0.12  $(0.52)
Diluted earnings (loss) per common share$0.35  $(1.04) $(0.41) $0.11  $(0.52)
Weighted average shares outstanding - basic 90,683   90,984   91,193   91,314   92,548 
Weighted average shares outstanding - diluted 91,189   90,984   91,193   91,672   92,548 
          
Yield on average interest earning assets (1) 6.21%  6.03%  6.07%  6.24%  6.49%
Net interest spread (1) 1.02%  0.90%  0.48%  0.41%  1.11%
Undepreciated earnings (loss) (1)$33,697  $(92,637) $(35,022) $12,641  $(46,116)
Undepreciated earnings (loss) per common share (1)$0.37  $(1.02) $(0.38) $0.14  $(0.50)
Book value per common share$11.31  $11.26  $12.44  $12.95  $13.27 
Adjusted book value per common share (1)$12.66  $12.93  $14.32  $15.41  $15.89 
          
Dividends declared per common share$0.20  $0.30  $0.30  $0.40  $0.40 
Dividends declared per preferred share on Series D Preferred Stock$0.50  $0.50  $0.50  $0.50  $0.50 
Dividends declared per preferred share on Series E Preferred Stock$0.49  $0.49  $0.49  $0.49  $0.49 
Dividends declared per preferred share on Series F Preferred Stock$0.43  $0.43  $0.43  $0.43  $0.43 
Dividends declared per preferred share on Series G Preferred Stock$0.44  $0.44  $0.44  $0.44  $0.44 


(1)Represents a non-GAAP financial measure. A reconciliation of the Company's non-GAAP financial measures to their most directly comparable GAAP measure is included below in "Reconciliation of Financial Information."


Reconciliation of Financial Information

Non-GAAP Financial Measures

In addition to the results presented in accordance with GAAP, this press release includes certain non-GAAP financial measures, including adjusted interest income, adjusted interest expense, adjusted net interest income, yield on average interest earning assets, average financing cost, net interest spread, undepreciated earnings and adjusted book value per common share. Our management team believes that these non-GAAP financial measures, when considered with our GAAP financial statements, provide supplemental information useful for investors as it enables them to evaluate our current performance and trends using the metrics that management uses to operate our business. Our presentation of non-GAAP financial measures may not be comparable to similarly-titled measures of other companies, who may use different calculations. Because these measures are not calculated in accordance with GAAP, they should not be considered a substitute for, or superior to, the financial measures calculated in accordance with GAAP. Our GAAP financial results and the reconciliations of the non-GAAP financial measures included in this press release to the most directly comparable financial measures prepared in accordance with GAAP should be carefully evaluated.

Adjusted Net Interest Income and Net Interest Spread

Financial results for the Company during a given period include the net interest income earned on our investment portfolio of residential loans, RMBS, CMBS, ABS and preferred equity investments and mezzanine loans, where the risks and payment characteristics are equivalent to and accounted for as loans (collectively, our “interest earning assets”). Adjusted net interest income and net interest spread (both supplemental non-GAAP financial measures) are impacted by factors such as our cost of financing, including our hedging costs, and the interest rate that our investments bear. Furthermore, the amount of premium or discount paid on purchased investments and the prepayment rates on investments will impact adjusted net interest income as such factors will be amortized over the expected term of such investments.

We provide the following non-GAAP financial measures, in total and by investment category, for the respective periods:

  • adjusted interest income – calculated as our GAAP interest income reduced by the interest expense recognized on Consolidated SLST CDOs,
  • adjusted interest expense – calculated as our GAAP interest expense reduced by the interest expense recognized on Consolidated SLST CDOs and adjusted to include the net interest component of interest rate swaps,
  • adjusted net interest income – calculated by subtracting adjusted interest expense from adjusted interest income,
  • yield on average interest earning assets – calculated as the quotient of our adjusted interest income and our average interest earning assets and excludes all Consolidated SLST assets other than those securities owned by the Company,
  • average financing cost – calculated as the quotient of our adjusted interest expense and the average outstanding balance of our interest bearing liabilities, excluding Consolidated SLST CDOs and mortgages payable on real estate, and
  • net interest spread – calculated as the difference between our yield on average interest earning assets and our average financing cost.

These measures remove the impact of Consolidated SLST that we consolidate in accordance with GAAP and include the net interest component of interest rate swaps utilized to hedge the variable cash flows associated with our variable-rate borrowings, which is included in gains (losses) on derivative instruments, net in the Company's consolidated statements of operations. With respect to Consolidated SLST, we only include the interest income earned by the Consolidated SLST securities that are actually owned by the Company as the Company only receives income or absorbs losses related to the Consolidated SLST securities actually owned by the Company. We include the net interest component of interest rate swaps in these measures to more fully represent the cost of our financing strategy.

We provide the non-GAAP financial measures listed above because we believe these non-GAAP financial measures provide investors and management with additional detail and enhance their understanding of our interest earning asset yields, in total and by investment category, relative to the cost of our financing and the underlying trends within our portfolio of interest earning assets. In addition to the foregoing, our management team uses these measures to assess, among other things, the performance of our interest earning assets in total and by asset, possible cash flows from our interest earning assets in total and by asset, our ability to finance or borrow against the asset and the terms of such financing and the composition of our portfolio of interest earning assets, including acquisition and disposition determinations.

Prior to the quarter ended December 31, 2022, we also reduced GAAP interest expense by the interest expense on mortgages payable on real estate. Commencing with the quarter ended December 31, 2022, we reclassified the interest expense on mortgages payable on real estate to expenses related to real estate on our consolidated statements of operations and, as such, it is no longer included in GAAP interest expense. Prior period disclosures have been conformed to the current period presentation.

A reconciliation of GAAP interest income to adjusted interest income, GAAP interest expense to adjusted interest expense and GAAP total net interest income to adjusted net interest income for the three months ended as of the dates indicated is presented below (dollar amounts in thousands):

 December 31, 2023
 Single-Family Multi-Family Corporate/Other Total
GAAP interest income$76,119  $2,670 $  $78,789 
GAAP interest expense (57,489)    (4,500)  (61,989)
GAAP total net interest income$18,630  $2,670 $(4,500) $16,800 
        
GAAP interest income$76,119  $2,670 $  $78,789 
Adjusted for:       
Consolidated SLST CDO interest expense (6,268)       (6,268)
Adjusted interest income$69,851  $2,670 $  $72,521 
        
GAAP interest expense$(57,489) $ $(4,500) $(61,989)
Adjusted for:       
Consolidated SLST CDO interest expense 6,268        6,268 
Net interest benefit of interest rate swaps 5,703     988   6,691 
Adjusted interest expense$(45,518) $ $(3,512) $(49,030)
        
Adjusted net interest income (1)$24,333  $2,670 $(3,512) $23,491 


 September 30, 2023
 Single-Family Multi-Family Corporate/Other Total
GAAP interest income$61,346  $3,849 $  $65,195 
GAAP interest expense (44,101)    (4,305)  (48,406)
GAAP total net interest income$17,245  $3,849 $(4,305) $16,789 
        
GAAP interest income$61,346  $3,849 $  $65,195 
Adjusted for:       
Consolidated SLST CDO interest expense (5,957)       (5,957)
Adjusted interest income$55,389  $3,849 $  $59,238 
        
GAAP interest expense$(44,101) $ $(4,305) $(48,406)
Adjusted for:       
Consolidated SLST CDO interest expense 5,957        5,957 
Net interest benefit of interest rate swaps 2,994     872   3,866 
Adjusted interest expense$(35,150) $ $(3,433) $(38,583)
        
Adjusted net interest income (1)$20,239  $3,849 $(3,433) $20,655 


 June 30, 2023
 Single-Family Multi-Family Corporate/Other Total
GAAP interest income$53,907  $3,618 $15  $57,540 
GAAP interest expense (38,542)    (3,862)  (42,404)
GAAP total net interest income$15,365  $3,618 $(3,847) $15,136 
        
GAAP interest income$53,907  $3,618 $15  $57,540 
Adjusted for:       
Consolidated SLST CDO interest expense (5,966)       (5,966)
Adjusted interest income$47,941  $3,618 $15  $51,574 
        
GAAP interest expense$(38,542) $ $(3,862) $(42,404)
Adjusted for:       
Consolidated SLST CDO interest expense 5,966        5,966 
Net interest benefit of interest rate swaps 909     555   1,464 
Adjusted interest expense$(31,667) $ $(3,307) $(34,974)
        
Adjusted net interest income (1)$16,274  $3,618 $(3,292) $16,600 


 March 31, 2023
 Single-Family Multi-Family Corporate/Other Total
GAAP interest income$53,519  $3,569 $48  $57,136 
GAAP interest expense (36,759)    (2,576)  (39,335)
GAAP total net interest income$16,760  $3,569 $(2,528) $17,801 
        
GAAP interest income$53,519  $3,569 $48  $57,136 
Adjusted for:       
Consolidated SLST CDO interest expense (6,315)       (6,315)
Adjusted interest income$47,204  $3,569 $48  $50,821 
        
GAAP interest expense$(36,759) $ $(2,576) $(39,335)
Adjusted for:       
Consolidated SLST CDO interest expense 6,315        6,315 
Net interest benefit of interest rate swaps 37     29   66 
Adjusted interest expense$(30,407) $ $(2,547) $(32,954)
        
Adjusted net interest income (1)$16,797  $3,569 $(2,499) $17,867 


 December 31, 2022
 Single-Family Multi-Family Corporate/Other Total
GAAP interest income$59,370  $3,514 $64  $62,948 
GAAP interest expense (38,163)    (2,488)  (40,651)
GAAP total net interest income$21,207  $3,514 $(2,424) $22,297 
        
GAAP interest income$59,370  $3,514 $64  $62,948 
Adjusted for:       
Consolidated SLST CDO interest expense (6,348)       (6,348)
Adjusted interest income$53,022  $3,514 $64  $56,600 
        
GAAP interest expense$(38,163) $ $(2,488) $(40,651)
Adjusted for:       
Consolidated SLST CDO interest expense 6,348        6,348 
Adjusted interest expense$(31,815) $ $(2,488) $(34,303)
        
Adjusted net interest income (1)$21,207  $3,514 $(2,424) $22,297 


(1)Adjusted net interest income is calculated by subtracting adjusted interest expense from adjusted interest income.


Undepreciated Earnings (Loss)

Undepreciated earnings (loss) is a supplemental non-GAAP financial measure defined as GAAP net income (loss) attributable to Company's common stockholders excluding the Company's share in depreciation expense and lease intangible amortization expense related to operating real estate, net. By excluding these non-cash adjustments from our operating results, we believe that the presentation of undepreciated earnings (loss) provides a consistent measure of our operating performance and useful information to investors to evaluate the effective net return on our portfolio. In addition, we believe that presenting undepreciated earnings (loss) enables our investors to measure, evaluate, and compare our operating performance to that of our peers.

A reconciliation of net income (loss) attributable to Company's common stockholders to undepreciated earnings (loss) for the respective periods ended is presented below (amounts in thousands, except per share data):

 For the Three Months Ended
 December 31,
2023
 September 30,
2023
 June 30,
2023
 March 31,
2023
 December 31,
2022
Net income (loss) attributable to Company's common stockholders$31,465 $(94,819) $(37,202) $10,521 $(48,076)
Add:         
Depreciation expense on operating real estate 2,232  2,182   2,180   2,120  1,960 
Amortization of lease intangibles related to operating real estate            
Undepreciated earnings (loss)$33,697 $(92,637) $(35,022) $12,641 $(46,116)
          
Weighted average shares outstanding - basic 90,683  90,984   91,193   91,314  92,548 
Undepreciated earnings (loss) per common share$0.37 $(1.02) $(0.38) $0.14 $(0.50)


Adjusted Book Value Per Common Share

Previously, we presented undepreciated book value per common share as a non-GAAP financial measure. Commencing with the quarter ended December 31, 2022, we discontinued disclosure of undepreciated book value per common share and instead present adjusted book value per common share, also a non-GAAP financial measure.

When presented in prior periods, undepreciated book value was calculated by excluding from GAAP book value the Company's share of cumulative depreciation and lease intangible amortization expenses related to real estate held at the end of the period. Since we began disclosing undepreciated book value, we identified additional items as materially affecting our book value and believe they should also be incorporated in order to provide a more useful non-GAAP measure for investors to evaluate our current performance and trends and facilitate the comparison of our financial performance and adjusted book value per common share to that of our peers. Accordingly, we calculate adjusted book value per common share by making the following adjustments to GAAP book value: (i) exclude the Company's share of cumulative depreciation and lease intangible amortization expenses related to real estate held at the end of the period for which an impairment has not been recognized, (ii) exclude the cumulative adjustment of redeemable non-controlling interests to estimated redemption value and (iii) adjust our liabilities that finance our investment portfolio to fair value.

Our rental property portfolio includes fee simple interests in single-family rental homes and joint venture equity interests in multi-family properties owned by Consolidated Real Estate VIEs. By excluding our share of cumulative non-cash depreciation and amortization expenses related to real estate held at the end of the period for which an impairment has not been recognized, adjusted book value reflects the value, at their undepreciated basis, of our single-family rental properties and joint venture equity investments that the Company has determined to be recoverable at the end of the period.

Additionally, in connection with third party ownership of certain of the non-controlling interests in certain of the Consolidated Real Estate VIEs, we record redeemable non-controlling interests as mezzanine equity on our consolidated balance sheets. The holders of the redeemable non-controlling interests may elect to sell their ownership interests to us at fair value once a year, subject to annual minimum and maximum amount limitations, resulting in an adjustment of the redeemable non-controlling interests to fair value that is accounted for by us as an equity transaction in accordance with GAAP. A key component of the estimation of fair value of the redeemable non-controlling interests is the estimated fair value of the multi-family apartment properties held by the applicable Consolidated Real Estate VIEs. However, because the corresponding real estate assets are not reported at fair value and thus not adjusted to reflect unrealized gains or losses in our consolidated financial statements, the cumulative adjustment of the redeemable non-controlling interests to fair value directly affects our GAAP book value. By excluding the cumulative adjustment of redeemable non-controlling interests to estimated redemption value, adjusted book value more closely aligns the accounting treatment applied to these real estate assets and reflects our joint venture equity investment at its undepreciated basis.

The substantial majority of our remaining assets are financial or similar instruments that are carried at fair value in accordance with the fair value option in our consolidated financial statements. However, unlike our use of the fair value option for the assets in our investment portfolio, the CDOs issued by our residential loan securitizations, senior unsecured notes and subordinated debentures that finance our investment portfolio assets are carried at amortized cost in our consolidated financial statements. By adjusting these financing instruments to fair value, adjusted book value reflects the Company's net equity in investments on a comparable fair value basis.

We believe that the presentation of adjusted book value per common share provides a more useful measure for investors and us than undepreciated book value as it provides a more consistent measure of our value, allows management to effectively consider our financial position and facilitates the comparison of our financial performance to that of our peers.

A reconciliation of GAAP book value to adjusted book value and calculation of adjusted book value per common share as of the dates indicated is presented below (amounts in thousands, except per share data):

 December 31,
2023
 September 30,
2023
 June 30,
2023
 March 31,
2023
 December 31,
2022
Company's stockholders' equity$1,579,612  $1,575,228  $1,690,712  $1,737,506  $1,767,216 
Preferred stock liquidation preference (554,110)  (554,110)  (555,699)  (556,645)  (557,125)
GAAP book value 1,025,502   1,021,118   1,135,013   1,180,861   1,210,091 
Add:         
Cumulative depreciation expense on real estate (1) 21,801   21,817   23,157   33,553   31,433 
Cumulative amortization of lease intangibles related to real estate (1) 14,897   21,356   30,843   59,844   59,844 
Cumulative adjustment of redeemable non-controlling interest to estimated redemption value 30,062   17,043   27,640   44,237   44,237 
Adjustment of amortized cost liabilities to fair value 55,271   90,929   90,129   86,978   103,066 
Adjusted book value$1,147,533  $1,172,263  $1,306,782  $1,405,473  $1,448,671 
          
Common shares outstanding 90,675   90,684   91,250   91,180   91,194 
GAAP book value per common share (2)$11.31  $11.26  $12.44  $12.95  $13.27 
Adjusted book value per common share (3)$12.66  $12.93  $14.32  $15.41  $15.89 


(1)Represents cumulative adjustments for the Company's share of depreciation expense and amortization of lease intangibles related to real estate held as of the end of the period presented for which an impairment has not been recognized.
(2)GAAP book value per common share is calculated using the GAAP book value and the common shares outstanding for the periods indicated.
(3)Adjusted book value per common share is calculated using the adjusted book value and the common shares outstanding for the periods indicated.


Equity Investments in Multi-Family Entities

We own joint venture equity investments in entities that own multi-family properties. We determined that these joint venture entities are VIEs and that we are the primary beneficiary of all but two of these VIEs, resulting in consolidation of the VIEs where we are the primary beneficiary, including their assets, liabilities, income and expenses, in our consolidated financial statements with non-controlling interests for the third-party ownership of the joint ventures' membership interests. With respect to the two additional joint venture equity investments for which we determined that we are not the primary beneficiary, we record our equity investments at fair value.

In September 2022, the Company announced a repositioning of its business through the opportunistic disposition over time of the Company's joint venture equity investments in multi-family properties and reallocation of its capital away from such assets to its targeted assets. Accordingly, as of December 31, 2023, the Company determined that certain joint venture equity investments met the criteria to be classified as held for sale and the assets and liabilities of the respective Consolidated VIEs are reported in assets and liabilities of disposal group held for sale.

We also own a preferred equity investment in a VIE that owns a multi-family property and for which, as of December 31, 2023, the Company determined it is the primary beneficiary, resulting in consolidation of the assets, liabilities, income and expenses of the VIE in our consolidated financial statements with a non-controlling interest for the third-party ownership of the VIE's membership interests.

A reconciliation of our net equity investments in consolidated multi-family properties and disposal group held for sale to our consolidated financial statements as of December 31, 2023 is shown below (dollar amounts in thousands):

Cash and cash equivalents $15,612 
Real estate, net  979,934 
Lease intangible, net (1)  2,378 
Assets of disposal group held for sale  426,017 
Other assets  34,657 
Total assets $1,458,598 
   
Mortgages payable on real estate, net $784,421 
Liabilities of disposal group held for sale  386,024 
Other liabilities  21,797 
Total liabilities $1,192,242 
   
Redeemable non-controlling interest in Consolidated VIEs $28,061 
Less: Cumulative adjustment of redeemable non-controlling interest to estimated redemption value  (30,062)
Non-controlling interest in Consolidated VIEs  17,150 
Non-controlling interest in disposal group held for sale  3,178 
Net equity investment (2) $248,029 


(1)Included in other assets in the accompanying consolidated balance sheets.
(2)The Company's net equity investment as of December 31, 2023 consists of $211.2 million of net equity investments in consolidated multi-family properties and $36.8 million of net equity investments in disposal group held for sale.


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