Cherry Hill Mortgage Investment Corp (CHMI) Reports Q3 2023 Earnings: Net Income Rises to $13. ...
Cherry Hill Mortgage Investment Corp (NYSE:CHMI) reported a GAAP net income of $13.1 million for Q3 2023
The company's earnings available for distribution attributable to common stockholders for Q3 2023 were $4.4 million
Cherry Hill's GAAP book value was $4.99 per diluted share as of September 30, 2023
The company declared a quarterly dividend of $0.15 per share of common stock for Q3 2023
Cherry Hill Mortgage Investment Corp (NYSE:CHMI) released its Q3 2023 earnings report on November 2, 2023. The company reported a GAAP net income applicable to common stockholders of $13.1 million, or $0.49 per basic and diluted weighted average common share outstanding. This income was primarily determined based on $0.5 million of net interest expense, $10.4 million of net servicing income, and a net realized gain of $20.7 million on derivatives.
Financial Highlights
The company's earnings available for distribution attributable to common stockholders for Q3 2023 were $4.4 million, or $0.16 per basic and diluted weighted average common share outstanding. The net unrealized loss on the companys RMBS portfolio classified as available-for-sale was approximately $14.5 million.
Cherry Hill realized net servicing fee income of $10.4 million, net interest expense of $0.5 million, and other income of $10.6 million, primarily related to realized and unrealized gains on derivatives and partially offset by realized and unrealized losses on the RMBS portfolio. The RMBS portfolio had a book value of approximately $1.08 billion and carrying value of approximately $1.02 billion at quarter-end September 30, 2023.
Dividends and Portfolio Highlights
On September 14, 2023, the Board of Directors declared a quarterly dividend of $0.15 per share of common stock for the third quarter of 2023. The dividend was paid in cash on October 31, 2023 to common stockholders of record as of the close of business on September 29, 2023.
As of September 30, 2023, Cherry Hills GAAP book value was $4.99 per diluted share, net of the third quarter dividend. The company used interest rate swaps, TBAs, and Treasury futures to mitigate duration risk and interest rate risk associated with the Companys RMBS and MSRs.
Earnings Available for Distribution
Earnings available for distribution (EAD) is a non-GAAP financial measure that the company defines as GAAP net income (loss), excluding realized gain (loss) on RMBS, unrealized gain (loss) on RMBS measured at fair value through earnings, realized and unrealized gain (loss) on derivatives, realized gain (loss) on acquired assets, realized and unrealized gain (loss) on investments in MSRs (net of any estimated MSR amortization) and any tax expense (benefit) on realized and unrealized gain (loss) on MSRs.
For the three months ended September 30, 2023, the total EAD attributable to common stockholders was $4.435 million, or $0.16 per diluted share. This is compared to the GAAP net income per share of common stock, per diluted share of $0.49.
Additional information regarding Cherry Hills financial condition and results of operations can be found in its Annual Report on Form 10-Q for the quarter ended September 30, 2023 filed with the Securities and Exchange Commission on November 2, 2023.
Explore the complete 8-K earnings release (here) from Cherry Hill Mortgage Investment Corp for further details.
This article first appeared on GuruFocus.
