Sachem Capital Corp. (NYSE American: SACH), a real estate lender
that specializes in originating, underwriting, funding, servicing,
and managing a portfolio of loans secured by first mortgages on
real property, today announced its financial results for the second
quarter ended June 30, 2024.
John Villano, CPA, Sachem Capital’s Chief
Executive Officer, stated: “During the second quarter, we
maintained our disciplined approach across our business by
retaining cash, being selective with our lending, and exercising
prudence in our borrowing. Specifically, in the second quarter we
reduced the total amount of our indebtedness by $33.8 million,
which includes a repayment of $23.7 million of unsecured
unsubordinated notes. We will continue to build our platform and
strengthen our balance sheet for the remainder of 2024 with a view
towards growth in 2025 as accretive capital becomes available.
Lastly, since our inception as a public company in February 2017,
management has built a reliable and robust lending platform, paid
an excellent stream of dividends and, most importantly, increased
book value during some volatile market periods.”
Results of operations for quarter ended
June 30, 2024
Total revenue for the quarter was $15.1 million,
compared to $16.3 million for the quarter ended June 30, 2023.
Interest income totaled $11.8 million, compared to $11.9 million in
the same quarter in 2023. The decrease in interest income was due
primarily to lower number of loans originated, modified or extended
in comparison to the quarter ended June 30, 2023. As a result, fee
income from loans, primarily made up of origination fees, were down
approximately 37.2% compared to the quarter ending June 30,
2023.
Total operating costs and expenses for the
quarter ended June 30, 2024 were $18.5 million compared to $10.3
million for the same 2023 period. The increase is primarily
attributable to a $8.5 million provision for credit losses compared
to $94,000 for the quarter ended June 30, 2023. This increase was
partially offset by a decrease in compensation and employee
benefits of $0.2 million because of a decrease in headcount between
periods.
Net loss attributable to common shares for the
three months ended June 30, 2024 was $4.1 million, or $0.09 per
share, compared to net income attributable to common shares of $4.8
million, or $0.11 per share, for the three months ended June 30,
2023. The change is mainly attributable to the larger provision for
credit losses reserves as mentioned above.
Balance Sheet
Total assets were $586.3 million at June 30,
2024 compared to $625.5 million at December 31, 2023. At June 30,
2024, cash and cash equivalents were $10.6 million and investments
in partnerships were $47.0 million. Net mortgages receivable for
the quarter were $485.7 million. Total liabilities at June 30, 2024
were $356.2 million compared to $395.5 million at December 31,
2023.
Total indebtedness at June 30, 2024 was $338.9
million. This includes: $259.9 million of unsecured notes payable
(net of $4.8 million of deferred financing costs), $55.0 million
outstanding on the Needham Bank revolving credit facility, $23.0
million outstanding on the Churchill master repurchase financing
facility and $1.0 million outstanding on a New Haven Bank mortgage
loan. We intend to repay $34.5 million of unsecured unsubordinated
notes due in December 2024 either by refinancing them or with a
combination of drawdowns on its existing credit facilities, current
cash on hand and principal repayments of its mortgage loans.
Total shareholders’ equity at June 30, 2024 rose
$0.1 million to $230.2 million compared to $230.1 million at
December 31, 2023. The change was primarily due to additional
paid-in capital of $6.1 million and a partly-offsetting increase in
accumulated deficit of $5.7 million and a decrease in accumulated
other comprehensive income of $0.3 million.
Dividends
On August 6, 2024, we paid a quarterly dividend
of $0.08 per share to shareholders of record on July 29, 2024.
Sachem currently operates and qualifies as a
Real Estate Investment Trust (REIT) for federal income taxes and
intends to continue to qualify and operate as a REIT. Under federal
income tax rules, a REIT is required to distribute a minimum of 90%
of taxable income each year to its shareholders, and the Company
intends to comply with this requirement for the current year.
Investor Conference Webcast and
Call
The Company is hosting a webcast and conference
call Wednesday, August 14, 2024 at 8:00 a.m. Eastern Time, to
discuss in greater detail its financial results for the quarter
ended June 30, 2024. A webcast of the call may be accessed on the
Company’s website at
https://ir.sachemcapitalcorp.com/ir-calendar.
Interested parties can access the conference
call via telephone by dialing toll free 877-704-4453 for U.S.
callers or +1-201-389-0920 for international callers.
Replay
The webcast will also be archived on the
Company’s website and a telephone replay of the call will be
available through Wednesday, August 28, 2024 and can be accessed by
dialing 1-844-512-2921 for U.S. callers or +1 412-317-6671 for
international callers and by entering replay passcode:
13746956.
About Sachem Capital Corp
Sachem Capital Corp. is a mortgage REIT that
specializes in originating, underwriting, funding, servicing, and
managing a portfolio of loans secured by first mortgages on real
property. It offers short-term (i.e., three years or less) secured,
nonbanking loans to real estate investors to fund their
acquisition, renovation, development, rehabilitation, or
improvement of properties. The Company’s primary underwriting
criteria is a conservative loan to value ratio. The properties
securing the loans are generally classified as residential or
commercial real estate and, typically, are held for resale or
investment. Each loan is secured by a first mortgage lien on real
estate and is personally guaranteed by the principal(s) of the
borrower. The Company also makes opportunistic real estate
purchases apart from its lending activities.
Forward Looking Statements
This press release may contain forward-looking
statements. All statements other than statements of historical
facts contained in this press release, including statements
regarding our future results of operations and financial position,
strategy and plans, and our expectations for future operations, are
forward-looking statements. The words “anticipate,” “estimate,”
“expect,” “project,” “plan,” “seek,” “intend,” “believe,” “may,”
“might,” “will,” “should,” “could,” “likely,” “continue,” “design,”
and the negative of such terms and other words and terms of similar
expressions are intended to identify forward-looking statements.
These forward-looking statements are based primarily on
management’s current expectations and projections about future
events and trends that management believes may affect the Company’s
financial condition, results of operations, strategy, short-term
and long-term business operations and objectives and financial
needs. These forward-looking statements are subject to several
risks, uncertainties and assumptions as described in the Annual
Report on Form 10-K for 2023 filed with the U.S. Securities and
Exchange Commission on April 1, 2024. Because of these risks,
uncertainties and assumptions, the forward-looking events and
circumstances discussed in this press release may not occur, and
actual results could differ materially and adversely from those
anticipated or implied in the forward-looking statements. You
should not rely upon forward-looking statements as predictions of
future events. Although the Company believes that the expectations
reflected in the forward-looking statements are reasonable, the
Company cannot guarantee future results, level of activity,
performance, or achievements. In addition, neither the Company nor
any other person assumes responsibility for the accuracy and
completeness of any of these forward-looking statements. The
Company disclaims any duty to update any of these forward-looking
statements. All forward-looking statements attributable to the
Company are expressly qualified in their entirety by these
cautionary statements as well as others made in this press release.
You should evaluate all forward-looking statements made by the
Company in the context of these risks and uncertainties.
Investor & Media Contact:Email:
investors@sachemcapitalcorp.com
|
SACHEM CAPITAL CORP.CONSOLIDATED BALANCE
SHEETS(dollars in thousands, except share
data)(unaudited) |
|
|
|
June 30, 2024 |
|
December 31, 2023 |
|
|
|
|
(audited) |
Assets |
|
|
|
|
|
|
Cash and cash equivalents |
|
$ |
10,577 |
|
|
$ |
12,598 |
|
Investment securities (at fair value) |
|
|
1,798 |
|
|
|
37,776 |
|
Mortgages receivable |
|
|
500,133 |
|
|
|
499,235 |
|
Less: Allowance for credit losses |
|
|
(14,405 |
) |
|
|
(7,523 |
) |
Mortgages receivable, net of allowance for credit losses |
|
|
485,728 |
|
|
|
491,712 |
|
Interest and fees receivable, net |
|
|
7,769 |
|
|
|
8,475 |
|
Due from borrowers, net |
|
|
5,636 |
|
|
|
5,597 |
|
Real estate owned |
|
|
3,872 |
|
|
|
3,462 |
|
Investments in partnerships |
|
|
46,952 |
|
|
|
43,036 |
|
Investments in rental real estate, net |
|
|
11,904 |
|
|
|
10,554 |
|
Property and equipment, net |
|
|
3,277 |
|
|
|
3,373 |
|
Other assets |
|
|
8,808 |
|
|
|
8,956 |
|
Total assets |
|
$ |
586,321 |
|
|
$ |
625,539 |
|
|
|
|
|
|
|
|
Liabilities and
Shareholders’ Equity |
|
|
|
|
|
|
Liabilities: |
|
|
|
|
|
|
Notes payable (net of deferred financing costs of $4,826 and
$6,048) |
|
$ |
259,913 |
|
|
$ |
282,353 |
|
Repurchase facility |
|
|
22,993 |
|
|
|
26,461 |
|
Mortgage payable |
|
|
1,042 |
|
|
|
1,081 |
|
Lines of credit |
|
|
55,000 |
|
|
|
61,792 |
|
Accrued dividends payable |
|
|
— |
|
|
|
5,144 |
|
Accounts payable and accrued liabilities |
|
|
2,800 |
|
|
|
2,322 |
|
Advances from borrowers |
|
|
8,893 |
|
|
|
10,998 |
|
Below market lease intangible |
|
|
665 |
|
|
|
665 |
|
Deferred revenue |
|
|
4,847 |
|
|
|
4,647 |
|
Total liabilities |
|
|
356,153 |
|
|
|
395,463 |
|
|
|
|
|
|
|
|
Commitments and
Contingencies |
|
|
|
|
|
|
|
|
|
|
|
|
|
Shareholders’ equity: |
|
|
|
|
|
|
Preferred shares - $.001 par
value; 5,000,000 shares authorized; 2,903,000 shares designated as
Series A Preferred Stock; 2,206,128 and 2,029,923 shares of Series
A Preferred Stock issued and outstanding at June 30, 2024 and
December 31, 2023, respectively |
|
$ |
2 |
|
|
$ |
2 |
|
Common shares - $.001 par
value; 200,000,000 shares authorized; 47,547,051 and 46,765,483
issued and outstanding at June 30, 2024 and December 31, 2023 |
|
|
48 |
|
|
|
47 |
|
Additional paid-in
capital |
|
|
255,928 |
|
|
|
249,826 |
|
Accumulated other
comprehensive income |
|
|
— |
|
|
|
316 |
|
Accumulated deficit |
|
|
(25,810 |
) |
|
|
(20,115 |
) |
Total shareholders’ equity |
|
|
230,168 |
|
|
|
230,076 |
|
Total liabilities and shareholders’ equity |
|
$ |
586,321 |
|
|
$ |
625,539 |
|
|
|
SACHEM CAPITAL CORP.CONSOLIDATED
STATEMENTS OF OPERATIONS (unaudited)(dollars in
thousands, except share and per share data) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended |
|
Six Months Ended |
|
|
June 30, |
|
June 30, |
|
|
2024 |
|
2023 |
|
2024 |
|
2023 |
Revenues |
|
|
|
|
|
|
|
|
|
|
|
|
Interest income from loans |
|
$ |
11,754 |
|
|
$ |
11,898 |
|
|
$ |
24,395 |
|
|
$ |
22,882 |
|
Fee income from loans |
|
|
2,083 |
|
|
|
3,319 |
|
|
|
4,699 |
|
|
|
5,489 |
|
Income from partnership
investments |
|
|
1,217 |
|
|
|
1,006 |
|
|
|
2,413 |
|
|
|
1,556 |
|
Other investment income |
|
|
70 |
|
|
|
34 |
|
|
|
386 |
|
|
|
633 |
|
Other income |
|
|
22 |
|
|
|
16 |
|
|
|
57 |
|
|
|
30 |
|
Total revenues |
|
|
15,146 |
|
|
|
16,273 |
|
|
|
31,950 |
|
|
|
30,590 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
expenses |
|
|
|
|
|
|
|
|
|
|
|
|
Interest and amortization of
deferred financing costs |
|
|
6,973 |
|
|
|
7,139 |
|
|
|
14,442 |
|
|
|
14,012 |
|
Compensation and employee
benefits |
|
|
1,365 |
|
|
|
1,562 |
|
|
|
3,308 |
|
|
|
3,342 |
|
General and administrative
expenses |
|
|
1,258 |
|
|
|
1,317 |
|
|
|
2,496 |
|
|
|
2,215 |
|
Provision for credit losses
related to loans |
|
|
8,503 |
|
|
|
94 |
|
|
|
9,868 |
|
|
|
197 |
|
Other expenses |
|
|
362 |
|
|
|
213 |
|
|
|
866 |
|
|
|
297 |
|
Total operating expenses |
|
|
18,461 |
|
|
|
10,325 |
|
|
|
30,980 |
|
|
|
20,063 |
|
Income before other income (loss) |
|
|
(3,315 |
) |
|
|
5,948 |
|
|
|
970 |
|
|
|
10,527 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other income
(loss) |
|
|
|
|
|
|
|
|
|
|
|
|
Impairment loss |
|
|
(77 |
) |
|
|
(413 |
) |
|
|
(77 |
) |
|
|
(413 |
) |
Gain (loss) on sale of real
estate and property and equipment, net |
|
|
275 |
|
|
|
(21 |
) |
|
|
264 |
|
|
|
127 |
|
Gain on equity securities |
|
|
61 |
|
|
|
184 |
|
|
|
458 |
|
|
|
577 |
|
Total other income (loss), net |
|
|
259 |
|
|
|
(250 |
) |
|
|
645 |
|
|
|
291 |
|
Net income (loss) |
|
|
(3,056 |
) |
|
|
5,698 |
|
|
|
1,615 |
|
|
|
10,818 |
|
Preferred stock dividend |
|
|
(1,068 |
) |
|
|
(925 |
) |
|
|
(2,091 |
) |
|
|
(1,850 |
) |
Net income (loss) attributable to common shareholders |
|
$ |
(4,124 |
) |
|
$ |
4,773 |
|
|
$ |
(476 |
) |
|
$ |
8,968 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic earnings (loss) per
common share |
|
$ |
(0.09 |
) |
|
$ |
0.11 |
|
|
$ |
(0.01 |
) |
|
$ |
0.21 |
|
Diluted earnings (loss) per
common share |
|
$ |
(0.09 |
) |
|
$ |
0.11 |
|
|
$ |
(0.01 |
) |
|
$ |
0.21 |
|
Basic weighted average common
shares outstanding |
|
|
47,504,875 |
|
|
|
43,844,285 |
|
|
|
47,415,630 |
|
|
|
43,321,303 |
|
Diluted weighted average
common shares outstanding |
|
|
47,504,875 |
|
|
|
43,844,285 |
|
|
|
47,415,630 |
|
|
|
43,321,303 |
|
|
|
SACHEM CAPITAL CORP.CONSOLIDATED
STATEMENTS OF CASH FLOWS (unaudited)(dollars in
thousands) |
|
|
|
|
|
|
|
|
|
|
Six Months Ended |
|
|
June 30, |
|
|
2024 |
|
2023 |
CASH FLOWS FROM OPERATING
ACTIVITIES |
|
|
|
|
|
|
Net income |
|
$ |
1,615 |
|
|
$ |
10,818 |
|
Adjustments to reconcile net income to net cash provided by
operating activities: |
|
|
|
|
|
|
Amortization of deferred financing costs and bond discount |
|
|
1,275 |
|
|
|
1,225 |
|
Depreciation expense |
|
|
189 |
|
|
|
109 |
|
Stock-based compensation |
|
|
437 |
|
|
|
396 |
|
Provision for credit losses related to loans |
|
|
9,868 |
|
|
|
197 |
|
Impairment Loss |
|
|
77 |
|
|
|
413 |
|
(Gain) on sale of real estate and property and equipment, net |
|
|
(264 |
) |
|
|
(127 |
) |
(Gain) on equity securities |
|
|
(458 |
) |
|
|
(577 |
) |
Changes in operating assets and liabilities: |
|
|
|
|
|
|
Interest and fees receivable, net |
|
|
411 |
|
|
|
(1,456 |
) |
Other assets |
|
|
80 |
|
|
|
(700 |
) |
Due from borrowers, net |
|
|
(624 |
) |
|
|
(1,521 |
) |
Accounts payable and accrued liabilities |
|
|
478 |
|
|
|
153 |
|
Deferred revenue |
|
|
200 |
|
|
|
455 |
|
Advances from borrowers |
|
|
(2,105 |
) |
|
|
2,694 |
|
Total adjustments |
|
|
9,564 |
|
|
|
1,261 |
|
NET CASH PROVIDED BY OPERATING
ACTIVITIES |
|
|
11,179 |
|
|
|
12,079 |
|
|
|
|
|
|
|
|
CASH FLOWS FROM INVESTING
ACTIVITIES |
|
|
|
|
|
|
Purchase of investment securities |
|
|
(7,767 |
) |
|
|
(18,347 |
) |
Proceeds from the sale of investment securities |
|
|
43,964 |
|
|
|
6,560 |
|
Purchase of interests in investment partnerships, net |
|
|
(3,916 |
) |
|
|
(4,568 |
) |
Proceeds from sale of real estate owned |
|
|
1,403 |
|
|
|
191 |
|
Acquisitions of and improvements to real estate owned, net |
|
|
— |
|
|
|
(180 |
) |
Purchases of property and equipment |
|
|
(26 |
) |
|
|
(722 |
) |
Improvements in investment in rental real estate |
|
|
(1,424 |
) |
|
|
— |
|
Principal disbursements for mortgages receivable |
|
|
(84,328 |
) |
|
|
(114,468 |
) |
Principal collections on mortgages receivable |
|
|
79,628 |
|
|
|
66,356 |
|
Other assets – pre-offering costs |
|
|
— |
|
|
|
19 |
|
NET CASH PROVIDED BY (USED IN)
INVESTING ACTIVITIES |
|
|
27,534 |
|
|
|
(65,159 |
) |
|
|
|
|
|
|
|
CASH FLOWS FROM FINANCING
ACTIVITIES |
|
|
|
|
|
|
Net proceeds from (repayment of) lines of credit |
|
|
(6,792 |
) |
|
|
32,313 |
|
Net proceeds from (repayment of) repurchase facility |
|
|
(3,468 |
) |
|
|
7,976 |
|
Proceeds from (repayment of) mortgage payable |
|
|
(39 |
) |
|
|
899 |
|
Dividends paid on common shares |
|
|
(10,363 |
) |
|
|
(11,048 |
) |
Dividends paid on Series A Preferred Stock |
|
|
(2,091 |
) |
|
|
(1,850 |
) |
Proceeds from issuance of common shares, net of expenses |
|
|
2,050 |
|
|
|
9,689 |
|
Repurchase of common shares |
|
|
— |
|
|
|
(225 |
) |
Proceeds from issuance of Series A Preferred Stock, net of
expenses |
|
|
3,616 |
|
|
|
517 |
|
Gross proceeds from (repayment of) notes payable |
|
|
(23,647 |
) |
|
|
6,225 |
|
NET CASH (USED IN) PROVIDED BY
FINANCING ACTIVITIES |
|
|
(40,734 |
) |
|
|
44,496 |
|
|
|
|
|
|
|
|
NET DECREASE IN CASH AND CASH
EQUIVALENTS |
|
|
(2,021 |
) |
|
|
(8,584 |
) |
|
|
|
|
|
|
|
CASH
AND CASH EQUIVALENTS – BEGINNING OF PERIOD |
|
|
12,598 |
|
|
|
23,713 |
|
|
|
|
|
|
|
|
CASH
AND CASH EQUIVALENTS – END OF PERIOD |
|
$ |
10,577 |
|
|
$ |
15,129 |
|
Sachem Capital (AMEX:SACH)
Gráfica de Acción Histórica
De Ago 2024 a Sep 2024
Sachem Capital (AMEX:SACH)
Gráfica de Acción Histórica
De Sep 2023 a Sep 2024