Blackstone Mortgage Trust, Inc. (NYSE:BXMT) Q3 2023 Earnings Call Transcript
Blackstone Mortgage Trust, Inc. (NYSE:BXMT) Q3 2023 Earnings Call Transcript October 25, 2023
Blackstone Mortgage Trust, Inc. beats earnings expectations. Reported EPS is $0.78, expectations were $0.72.
Operator: Good day, and welcome to the Blackstone Mortgage Trust Third Quarter 2023 Investor Call. Today's call is being recorded. At this time all participants are in a listen-mode only. [Operator Instructions]. At this time, I'd like to turn the conference over to Tim Hayes, Vice President, Shareholder Relations. Please go ahead.
Timothy Hayes: Good morning, and welcome everyone to Blackstone Mortgage Trust's third quarter 2023 conference call. I'm joined today by Katie Keenan, Chief Executive Officer; Tony Marone, Chief Financial Officer; and Austin Peña, Executive Vice President of Investments. This morning, we filed our 10-Q and issued a press release with the presentation of our results, which are available on our website and have been filed with the SEC. I'd like to remind everyone that today's call may include forward-looking statements, which are subject to risks, uncertainties, and other factors outside of the company's control. Actual results may differ materially. For a discussion of some of the risks that could affect results, please see the Risk Factors section of our most recent 10-K.
A woman signing papers with her banker for her first home mortgage. Editorial photo for a financial news article. 8k. --ar 16:9
We do not undertake any duty to update forward-looking statements. We will also refer to certain non-GAAP measures on this call. And for reconciliations, you should refer to the press release and our 10-Q. This audio cast is copyrighted material of Blackstone Mortgage Trust and may not be duplicated without our consent. For the third quarter, we reported GAAP net income of $0.17 per share, while distributable earnings were $0.78 per share. A few weeks ago, we paid a dividend of $0.62 per share with respect to the third quarter. Please let me know if you have any questions following today's call. With that, I'll now turn things over to Katie.
Katie Keenan: Thanks Tim. Since our last earnings call geopolitical risk is more acute and interest rates have continued their March higher. The tenure is 4.9% up 100 basis points in the last three months, and SOFR is at 5.3%. We believe that higher rates are having the Feds desired impact with inflation decelerating and economic growth slowing. But we take the Fed at their word and expect rates to persist at these levels and are managing the business accordingly. Rates impact our lending business in two critical and correlated ways. First, as a floating rate lender we continue to recognize the pronounced benefit in our income from higher base rates yielding yet another quarter of strong distributable earnings. At the same time the sustained pressure of high rates and the attendant capital markets illiquidity is weighing on the overall credit environment.
For dividend we are able to bolster our book value and significantly offset increasing reserves. The steps we've taken on both sides of our balance sheet including proactive asset management, a conservative liquidity posture, and a patient approach to new investments leave us on strong footing to navigate this environment. This positioning is evident in our third quarter results with DE of $0.78 per share covering our dividend by a 126%. Liquidity is still at record levels and a continued reduction in our leverage. On the credit side our portfolio remains resilient, 95% performing notwithstanding some negative credit migration and a continued healthy pace of repayments. And over the first three quarters of the year we contributed over $80 million of distributable earnings in excess of our dividend to book value cushioning much of the impact of incremental reserves.
See also 30 Countries That Export The Most Weapons in the World and 20 Most Popular Scotch Whisky Brands in USA.
To continue reading the Q&A session, please click here.
