NEW YORK, May 8, 2018 /PRNewswire/ -- Sutherland Asset
Management Corporation ("Sutherland" or the "Company") (NYSE: SLD)
today reported financial results for the quarter ended March 31, 2018.
First Quarter Highlights:
- Net income of $18.5 million, or
$0.56 per share of common stock
- Core earnings of $15.5 million,
or $0.47 per share of common
stock
- Adjusted net book value of $16.88
per share of common stock as of March 31,
2018
- Originated $211.6 million of
small balance commercial ("SBC") loans
- Originated $48.3 million of loans
guaranteed by the U.S. Small Business Administration (the "SBA")
under its Section 7(a) loan program
- Originated $439.0 million of
residential mortgage loans
- Acquired $142.2 million of SBC
loans
Highlights Subsequent to Quarter End:
- Issued $50.0 million in aggregate
principal of 6.50% Senior Notes due 2021
A summary of Sutherland's operating results for the quarter
ended March 31, 2018 is presented
below. Sutherland reported U.S. GAAP net income for the three
months ended March 31, 2018 of
$18.5 million, or $0.56 per share of common stock, and Core
Earnings (a non-GAAP financial measure) of $15.5 million, or $0.47 per share of common stock.
Thomas Capasse, Chairman and
Chief Executive Officer commented, "We are pleased with our team's
ability to deploy capital by growing new loan originations and
identifying accretive portfolio acquisition opportunities with the
potential to generate outsized returns, which we benefitted from
this quarter. As a result, our quarterly per share earnings
increased by $0.18 per share over the
fourth quarter. As we move further into 2018, we continue to
be focused on growing our core origination platform while sourcing
opportunistic acquisitions."
The Company issued a full detailed presentation of its first
quarter 2018 results, which can be viewed in the investor relations
section at www.sutherlandam.com.
Use of Non-GAAP Financial Information
In addition to the results presented in accordance with U.S.
GAAP, this press release includes Core Earnings which is a non-U.S.
GAAP financial measure. The Company defines Core Earnings as net
income adjusted for unrealized or realized gains (losses) related
to certain mortgage backed securities, unrealized gains (losses)
related to residential mortgage servicing rights, and one-time
non-recurring gains or losses, such as gains or losses on
discontinued operations, bargain purchase gains or merger related
expenses.
The Company believes that providing investors with this non-U.S.
GAAP financial information, in addition to the related U.S. GAAP
measures, gives investors greater transparency into the information
used by management in its financial and operational
decision-making. However, because Core Earnings is an incomplete
measure of the Company's financial performance and involves
differences from net income computed in accordance with U.S. GAAP,
it should be considered along with, but not as an alternative to,
the Company's net income computed in accordance with U.S. GAAP as a
measure of the Company's financial performance. In addition,
because not all companies use identical calculations, the Company's
presentation of Core Earnings may not be comparable to other
similarly-titled measures of other companies.
The following table reconciles net income computed in accordance
with U.S. GAAP to Core Earnings for the three months ended
March 31, 2018:
|
|
|
|
|
(In Thousands)
|
|
|
Three Months
Ended
March 31, 2018
|
|
Net
Income
|
|
$
|
18,518
|
|
Reconciling
items:
|
|
|
|
|
Unrealized loss on
mortgage-backed securities
|
|
|
79
|
|
Unrealized (gain) on
mortgage servicing rights
|
|
|
(4,155)
|
|
Total reconciling
items
|
|
$
|
(4,076)
|
|
Core earnings
before income taxes
|
|
$
|
14,442
|
|
Income tax
adjustments
|
|
|
1,047
|
|
Core
earnings
|
|
$
|
15,489
|
Webcast and Earnings Conference Call
Management will host a webcast and conference call on
Wednesday, May 9, 2018 at
8:30 am ET to provide a general
business update and discuss the financial results for the quarter
ended March 31, 2018. The
conference call can be accessed by dialing 888-289-0438 (domestic)
or 323-794-2423 (international).
The conference call will also be available in the Investor
Relations section of the Company's website at www.sutherlandam.com.
To listen to a live broadcast, go to the site at least 15 minutes
prior to the scheduled start time in order to register, download
and install any necessary audio software. A replay of the
call will also be available on the Company's website approximately
two hours after the live call through May
23, 2018. To access the replay, dial 844-512-2921
(domestic) or 412-317-6671 (international). The replay pin number
is 5676498.
Safe Harbor Statement
This press release contains statements that
constitute "forward-looking statements," as
such term is defined in Section 27A of the Securities Act of 1933,
as amended, and Section 21E of the Securities
Exchange Act of 1934, as amended, and such statements are intended
to be covered by the safe harbor provided by the
same. These statements are based on management's current
expectations and beliefs and are subject to a number of trends and
uncertainties that could cause actual results to differ materially
from those described in the forward-looking statements; the
Company can give no assurance that its expectations will be
attained. Factors that could cause actual results to differ
materially from the Company's expectations include, but are
not limited to, applicable regulatory changes; general
volatility of the capital markets; changes in the Company's
investment objectives and business strategy; the availability of
financing on acceptable terms or at all; the availability, terms
and deployment of capital; the availability of suitable investment
opportunities; changes in the interest rates or the general
economy; increased rates of default and/or decreased recovery rates
on investments; changes in interest rates, interest rate spreads,
the yield curve or prepayment rates; changes in prepayments of
Company's assets; the degree and nature of competition, including
competition for the Company's target assets; and other factors,
including those set forth in the Risk Factors section of the
Company's most recent Annual Report on Form 10-K filed with
the SEC, and other reports filed by the Company with the SEC,
copies of which are available on the SEC's website, www.sec.gov.
The Company undertakes no obligation to update these statements for
revisions or changes after the date of this release, except as
required by law.
Contact
Investor Relations
Sutherland Asset Management Corporation
212-257-4666
SutherlandIR@waterfallam.com
Additional information can be found on the Company's website at
www.sutherlandam.com.
|
SUTHERLAND ASSET
MANAGEMENT CORPORATION
UNAUDITED
CONSOLIDATED BALANCE SHEETS
|
|
|
(In Thousands)
|
|
March 31, 2018
|
|
December 31, 2017
|
|
Assets
|
|
|
|
|
|
|
|
Cash and cash
equivalents
|
|
$
|
86,773
|
|
$
|
63,425
|
|
Restricted
cash
|
|
|
13,964
|
|
|
11,666
|
|
Loans, net (including
$40,430 and $188,150 held at fair value)
|
|
|
1,057,034
|
|
|
1,017,920
|
|
Loans, held for sale,
at fair value
|
|
|
160,999
|
|
|
216,022
|
|
Mortgage backed
securities, at fair value
|
|
|
47,181
|
|
|
39,922
|
|
Loans eligible for
repurchase from Ginnie Mae
|
|
|
81,484
|
|
|
95,158
|
|
Investment in
unconsolidated joint venture
|
|
|
50,229
|
|
|
55,369
|
|
Derivative
instruments
|
|
|
5,022
|
|
|
4,725
|
|
Servicing rights
(including $81,591 and $72,295 held at fair value)
|
|
|
104,613
|
|
|
94,038
|
|
Receivable from third
parties
|
|
|
11,064
|
|
|
6,756
|
|
Other assets
|
|
|
53,592
|
|
|
56,840
|
|
Assets of consolidated
VIEs
|
|
|
968,999
|
|
|
861,662
|
|
Total
Assets
|
|
$
|
2,640,954
|
|
$
|
2,523,503
|
|
Liabilities
|
|
|
|
|
|
|
|
Secured
borrowings
|
|
|
657,233
|
|
|
631,286
|
|
Promissory
note
|
|
|
5,883
|
|
|
6,107
|
|
Securitized debt
obligations of consolidated VIEs, net
|
|
|
679,871
|
|
|
598,148
|
|
Convertible notes,
net
|
|
|
109,226
|
|
|
108,991
|
|
Senior secured notes,
net
|
|
|
178,688
|
|
|
138,078
|
|
Guaranteed loan
financing
|
|
|
278,500
|
|
|
293,045
|
|
Contingent
consideration
|
|
|
10,732
|
|
|
10,016
|
|
Liabilities for loans
eligible for repurchase from Ginnie Mae
|
|
|
81,484
|
|
|
95,158
|
|
Derivative
instruments
|
|
|
756
|
|
|
282
|
|
Dividends
payable
|
|
|
12,335
|
|
|
12,289
|
|
Accounts payable and
other accrued liabilities
|
|
|
64,490
|
|
|
74,636
|
|
Total
Liabilities
|
|
$
|
2,079,198
|
|
$
|
1,968,036
|
|
Stockholders'
Equity
|
|
|
|
|
|
|
|
Common stock, $0.0001
par value, 500,000,000 shares authorized, 31,996,440 and
31,996,440
shares issued and outstanding,
respectively
|
|
|
3
|
|
|
3
|
|
Additional paid-in
capital
|
|
|
539,457
|
|
|
539,455
|
|
Retained earnings
(deficit)
|
|
|
2,559
|
|
|
(3,385)
|
|
Total
Sutherland Asset Management Corporation equity
|
|
|
542,019
|
|
|
536,073
|
|
Non-controlling
interests
|
|
|
19,737
|
|
|
19,394
|
|
Total
Stockholders' Equity
|
|
$
|
561,756
|
|
$
|
555,467
|
|
Total Liabilities
and Stockholders' Equity
|
|
$
|
2,640,954
|
|
$
|
2,523,503
|
|
SUTHERLAND ASSET
MANAGEMENT CORPORATION
UNAUDITED
CONSOLIDATED STATEMENTS OF INCOME
|
|
|
|
Three Months Ended
March 31,
|
|
(In Thousands, except share data)
|
|
2018
|
|
2017
|
|
Interest
income
|
|
$
|
37,150
|
|
$
|
33,884
|
|
Interest
expense
|
|
|
(22,666)
|
|
|
(16,441)
|
|
Net interest
income before provision for loan losses
|
|
$
|
14,484
|
|
$
|
17,443
|
|
Provision for loan
losses
|
|
|
(167)
|
|
|
(1,232)
|
|
Net interest
income after provision for loan losses
|
|
$
|
14,317
|
|
$
|
16,211
|
|
Non-interest
income
|
|
|
|
|
|
|
|
Gains on residential
mortgage banking activities, net of variable loan
expenses
|
|
|
11,734
|
|
|
10,509
|
|
Other income
|
|
|
1,334
|
|
|
840
|
|
Income on
unconsolidated joint venture
|
|
|
5,739
|
|
|
—
|
|
Servicing income, net
of amortization and impairment of $1,350 and $2,765
|
|
|
6,410
|
|
|
4,442
|
|
Total
non-interest income
|
|
$
|
25,217
|
|
$
|
15,791
|
|
Non-interest
expense
|
|
|
|
|
|
|
|
Employee compensation
and benefits
|
|
|
(15,320)
|
|
|
(13,464)
|
|
Allocated employee
compensation and benefits from related party
|
|
|
(1,200)
|
|
|
(1,012)
|
|
Professional
fees
|
|
|
(2,648)
|
|
|
(2,159)
|
|
Management fees –
related party
|
|
|
(2,013)
|
|
|
(1,977)
|
|
Incentive fees –
related party
|
|
|
(408)
|
|
|
—
|
|
Loan servicing
expense
|
|
|
(4,093)
|
|
|
(1,513)
|
|
Other operating
expenses
|
|
|
(8,011)
|
|
|
(5,534)
|
|
Total
non-interest expense
|
|
$
|
(33,693)
|
|
$
|
(25,659)
|
|
Net realized gain
on financial instruments
|
|
|
12,232
|
|
|
2,966
|
|
Net unrealized
gain on financial instruments
|
|
|
3,008
|
|
|
1,282
|
|
Income before
provision for income taxes
|
|
$
|
21,081
|
|
$
|
10,591
|
|
Provision for income
taxes
|
|
|
(2,563)
|
|
|
(1,034)
|
|
Net
income
|
|
$
|
18,518
|
|
$
|
9,557
|
|
Less: Net income
attributable to non-controlling interest
|
|
|
664
|
|
|
701
|
|
Net income
attributable to Sutherland Asset Management
Corporation
|
|
$
|
17,854
|
|
$
|
8,856
|
|
|
|
|
|
|
|
|
Earnings per
common share - basic
|
|
$
|
0.56
|
|
$
|
0.29
|
|
Earnings per
common share - diluted
|
|
$
|
0.56
|
|
$
|
0.29
|
|
|
|
|
|
|
|
|
Weighted-average
shares outstanding
|
|
|
|
|
|
|
|
Basic
|
|
|
32,036,504
|
|
|
30,549,806
|
|
Diluted
|
|
|
32,045,844
|
|
|
30,549,806
|
|
|
|
|
|
|
|
|
Dividends declared
per share of common stock
|
|
$
|
0.37
|
|
$
|
0.37
|
|
SUTHERLAND ASSET
MANAGEMENT CORPORATION
UNAUDITED SEGMENT
REPORTING
FOR THE THREE
MONTHS ENDED MARCH 31, 2018
|
|
|
|
|
|
|
|
SBA Originations,
|
|
Residential
|
|
|
|
|
|
|
Loan
|
|
SBC
|
|
Acquisitions,
|
|
Mortgage
|
|
Corporate-
|
|
|
|
(In Thousands)
|
|
Acquisitions
|
|
Originations
|
|
and Servicing
|
|
Banking
|
|
Other
|
|
Consolidated
|
|
Interest
income
|
|
$
|
9,688
|
|
$
|
17,858
|
|
$
|
8,715
|
|
$
|
889
|
|
$
|
—
|
|
$
|
37,150
|
|
Interest
expense
|
|
|
(5,831)
|
|
|
(12,470)
|
|
|
(3,620)
|
|
|
(745)
|
|
|
—
|
|
|
(22,666)
|
|
Net interest
income before provision for loan losses
|
|
$
|
3,857
|
|
$
|
5,388
|
|
$
|
5,095
|
|
$
|
144
|
|
$
|
—
|
|
$
|
14,484
|
|
Provision for loan
losses
|
|
|
(272)
|
|
|
36
|
|
|
69
|
|
|
—
|
|
|
—
|
|
|
(167)
|
|
Net interest
income after provision for loan losses
|
|
$
|
3,585
|
|
$
|
5,424
|
|
$
|
5,164
|
|
$
|
144
|
|
$
|
—
|
|
$
|
14,317
|
|
Non-interest
income
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Gains on residential
mortgage banking activities, net of
variable loan expenses
|
|
$
|
—
|
|
$
|
—
|
|
$
|
—
|
|
$
|
11,734
|
|
$
|
—
|
|
$
|
11,734
|
|
Other income
|
|
|
156
|
|
|
1,259
|
|
|
(123)
|
|
|
42
|
|
|
—
|
|
|
1,334
|
|
Income from
unconsolidated joint venture
|
|
|
5,739
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
5,739
|
|
Servicing
income
|
|
|
5
|
|
|
252
|
|
|
1,252
|
|
|
4,901
|
|
|
—
|
|
|
6,410
|
|
Total
non-interest income
|
|
$
|
5,900
|
|
$
|
1,511
|
|
$
|
1,129
|
|
$
|
16,677
|
|
$
|
—
|
|
$
|
25,217
|
|
Non-interest
expense
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Employee compensation
and benefits
|
|
|
(173)
|
|
|
(2,637)
|
|
|
(3,255)
|
|
|
(9,114)
|
|
|
(141)
|
|
|
(15,320)
|
|
Allocated employee
compensation and benefits from
related party
|
|
|
(120)
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1,080)
|
|
|
(1,200)
|
|
Professional
fees
|
|
|
(317)
|
|
|
(389)
|
|
|
(479)
|
|
|
(109)
|
|
|
(1,354)
|
|
|
(2,648)
|
|
Management fees –
related party
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(2,013)
|
|
|
(2,013)
|
|
Incentive fees –
related party
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(408)
|
|
|
(408)
|
|
Loan servicing
expense
|
|
|
(808)
|
|
|
(631)
|
|
|
76
|
|
|
(2,730)
|
|
|
—
|
|
|
(4,093)
|
|
Other operating
expenses
|
|
|
(818)
|
|
|
(2,679)
|
|
|
(1,110)
|
|
|
(2,700)
|
|
|
(704)
|
|
|
(8,011)
|
|
Total
non-interest expense
|
|
$
|
(2,236)
|
|
$
|
(6,336)
|
|
$
|
(4,768)
|
|
$
|
(14,653)
|
|
$
|
(5,700)
|
|
$
|
(33,693)
|
|
Net realized gain
on financial instruments
|
|
|
148
|
|
|
8,699
|
|
|
3,385
|
|
|
—
|
|
|
—
|
|
|
12,232
|
|
Net unrealized
gain (loss) on financial instruments
|
|
|
(46)
|
|
|
(2,367)
|
|
|
533
|
|
|
4,888
|
|
|
—
|
|
|
3,008
|
|
Income before
provision for income taxes
|
|
$
|
7,351
|
|
$
|
6,931
|
|
$
|
5,443
|
|
$
|
7,056
|
|
$
|
(5,700)
|
|
$
|
21,081
|
|
Total
Assets
|
|
$
|
609,997
|
|
$
|
1,223,608
|
|
$
|
503,512
|
|
$
|
283,000
|
|
$
|
20,837
|
|
$
|
2,640,954
|
View original
content:http://www.prnewswire.com/news-releases/sutherland-asset-management-corporation-announces-first-quarter-2018-results-300644945.html
SOURCE Sutherland Asset Management Corporation