New York Mortgage Trust Reports Fourth Quarter 2004 Results
NEW YORK, NY - March 15, 2005 - New York Mortgage Trust, Inc. (NYSE: NTR), a self-advised residential mortgage finance company, today reported results for the fourth quarter and year ended December 31, 2004. Highlights included:
- Post-IPO REIT net income of $7.3 million or $0.41 per share for the year ended December 31, 2004;
- Post-IPO total dividends paid during 2004 of $0.40 per share ($0.16 for the third quarter of 2004 and $0.24 for the fourth quarter of 2004);
- Consolidated net income of $4.9 million or $0.28 per share for the year ended December 31, 2004;
- Consolidated net income of $2.0 million, or $0.11 per share, for the fourth quarter of 2004;
- Total assets of approximately $1.6 billion as of December 31, 2004;
- Record mortgage origination volume of approximately $632.7 million for the fourth quarter of 2004, 57.9% of which were for purchase mortgages and 55.3% of which were adjustable rate mortgages;
- During the fourth quarter, NTR acquired Guaranty Residential Mortgage Lending's (GRL) Northeast and Mid-Atlantic retail mortgage origination platform which added 15 full service and 26 satellite retail mortgage banking branches and approximately 275 employees.
Fourth Quarter Financial Highlights
For the quarter endedDecember 31, 2004, the Company reported total revenues of $22.4 million, net income of $2.0 million and net income per basic and diluted share of $0.11. Total shares of common stock outstanding as of December 31, 2004 were 17,797,375. The Company's taxable REIT subsidiary had a net loss for the quarter of approximately $2.3 million which was primarily due to forgone gains on sale associated with a cost-basis transfer of self originated loans to the REIT. The quarter ended December 31, 2004 was the second full quarter in which the Company operated as a public company. As a result only current period financial performance is provided.
"2004 was a tremendously successful and significant year for New York Mortgage Trust,"Steven Schnall, Chairman and Co-Chief Executive Officer, commented, "We have achieved our immediate goals and objectives since the IPO - those of growing our mortgage origination platform, profitably investing our IPO proceeds in high-quality mortgage backed securities and aggregating a critical mass of mortgage loans for our first securitization which was completed last month. The actions taken since our June 2004 IPO have significantly increased our residential mortgage loan origination business, thus accelerating the pace of our achieving our ultimate goal of owning mortgage securities backed predominately by our own lower-cost mortgage originations. On the acquisition front we completed two low-cost branch transactions allowing us to enter new target markets as well as increase our presence in others. These acquisitions have increased our current estimated ru n-rate of annual origination volume to approximately $3.4 billion, more than double our 2003 levels. Furthermore, we were the low-cost bidder on these acquisitions, which is testimony to New York Mortgage Trust's attractiveness as an origination partner."
Mr. Schnall further commented, "Looking ahead, we remain focused on adhering to our portfolio strategy of strict interest rate and credit risk management with the utilization of effective hedging and reasonable leverage. We are also committed to continuing the growth of our mortgage origination subsidiary and on remaining a premier provider of residential mortgage services in terms of customer satisfaction and quality of service. Also, given our recent successes in growing our origination platform, we are now well positioned to substantially replace our initial $1.2 billion portfolio of acquired mortgage-backed securities with self-originated loans by the end of this year. We feel that we have never been more able to take advantage of opportunities in the origination marketplace and that our prospects have never looked better. In summary, we believe that New York Mortgage Trust is extremely well positioned to execute its strategic plan for internal and external growth in 2005 and beyond."
Michael Wirth, Chief Financial Officer, added, "The accomplishment of our strategic goals in 2004 is critical to our future success. Since our mid-November acquisition of GRL we have fully integrated its sales force and continue to make infrastructure improvements to facilitate the additional loan production growth we anticipate for 2005 and beyond. As a result, in the fourth quarter of 2004 we have incurred atypical upfront costs. We expect these up-front costs, such as legal and consulting fees and increased personnel, technology and other expenses associated with the increased capacity, to continue through the first quarter of 2005."
Mr. Wirth continued, "We are cognizant of the need to carefully manage our growth with balanced financial performance and, despite these increased expenses, we are confident that our investments in new infrastructure, technology and personnel will pay off once fully implemented and efficiencies are realized in terms of reduced costs and a significant positive impact on our earnings. Our portfolio investment segment continues to be a solid performer from which we primarily base our dividend distribution policy."
As of December 31, 2004, the Company's total assets were approximately $1.6 billion, including approximately $1.2 billion of residential mortgage-backed securities, $190.7 million of residential mortgage loans held for securitization, $85.4 million of residential mortgage loans held for sale, $79.9 million due from loan purchasers and $16.2 million of advance fundings for pending loans to be closed. The Company, at December 31, 2004, had $1.5 billion outstanding under its various financing facilities.
A breakdown of the Company's loan originations for the 2004 fourth quarter follows:
| |
Number
of Loans
| Aggregate
Principal
Balance
($ in millions) |
Percentage
Of Total
Principal
| Weighted
Average
Interest
Rate |
Average
Principal
Balance
|
Weighted
Average
|
| | | | | | | LTV | FICO |
ARM | 1,094 | $330.1 | 52.2% | 5.23% | $301,765 | 71.1 | 714 |
Fixed-rate | 956 | $206.8 | 32.7% | 6.32% | $216,266 | 72.1 | 714 |
Subtotal-non-FHA* | 2,050 | $536.9 | 84.9% | 5.65% | $261,893 | 71.5 | 714 |
FHA - ARM | 150 | $19.5 | 3.1% | 5.20% | $130,215 | 92.7 | 627 |
FHA - fixed-rate | 599 | $76.2 | 12.0% | 6.04% | $127,281 | 92.0 | 622 |
Subtotal - FHA | 749 | $95.7 | 15.1% | 5.87% | $127,868 | 92.1 | 623 |
Total | 2,799 | $632.6 | 100.0% | 5.68% | $226,029 | 74.6 | 700 |
| | | | | | | | |
Purchase mortgages | 1,426 | $353.3 | 55.9% | 5.65% | $247,722 | 75.1 | 724 |
Refinancings | 624 | $183.6 | 29.0% | 5.65% | $294,278 | 64.4 | 694 |
Subtotal-non-FHA* | 2,050 | $536.9 | 84.9% | 5.65% | $261,893 | 71.5 | 714 |
FHA - purchase | 82 | $13.3 | 2.1% | 5.93% | $162,494 | 96.4 | 647 |
FHA - refinancings | 667 | $82.4 | 13.0% | 5.86% | $123,611 | 91.4 | 619 |
Subtotal - FHA | 749 | $95.7 | 15.1% | 5.87% | $127,868 | 92.1 | 623 |
Total | 2,799 | $632.6 | 100.0% | 5.68% | $226,029 | 74.6 | 700 |
A breakdown of the Company's loan originations for 2004 follows:
| |
Number
of Loans
| Aggregate
Principal
Balance
($ in millions) |
Percentage
Of Tota
Principal
| Weighted
Average
Interest
Rate |
Average
Principal
Balance
|
Weighted
Average
|
| | | | | | | LTV | FICO |
ARM | 3,019 | $936.4 | 50.8% | 5.01% | $310,162 | 77.1 | 715 |
Fixed-rate | 2,973 | $651.8 | 35.3% | 6.40% | $219,245 | 71.0 | 715 |
Subtotal-non-FHA* | 5,992 | $1,588.2 | 86.1% | 5.58% | $265,053 | 74.6 | 715 |
FHA - ARM | 231 | $30.4 | 1.6% | 5.12% | $131,503 | 92.9 | 625 |
FHA - fixed-rate | 1,830 | $226.9 | 12.3% | 6.04% | $124,007 | 92.1 | 632 |
Subtotal - FHA | 2,061 | $257.3 | 13.9% | 5.94% | $124,847 | 92.1 | 631 |
Total | 8,053 | $1,845.5 | 100.0% | 5.63% | $229,170 | 77.1 | 703 |
| | | | | | | | |
Purchase mortgages | 4,167 | $1,050.8 | 56.9% | 5.61% | $252,164 | 80.4 | 723 |
Refinancings | 1,825 | $537.4 | 29.2% | 5.53% | $294,481 | 63.3 | 698 |
Subtotal-non-FHA* | 5,992 | $1,588.2 | 86.1% | 5.58% | $265,053 | 74.6 | 715 |
FHA - purchase | 237 | $38.7 | 2.1% | 6.16% | $163,424 | 96.0 | 636 |
FHA - refinancings | 1,824 | $218.6 | 11.8% | 5.90% | $119,835 | 91.5 | 630 |
Subtotal - FHA | 2,061 | $257.3 | 13.9% | 5.94% | $124,847 | 92.1 | 631 |
Total | 8,053 | $1,845.5 | 100.0% | 5.63% | $229,170 | 77.1 | 703 |
*In March the Company acquired eight origination branches from SIB Mortgage Corp., one of which originates only FHA Streamlined Refinance mortgages with low average balances. All loans from this branch are and will continue to be sold to third party investors.
Investment Activity
At the end of the fourth quarter, our portfolio of investment securities had a weighted average purchase price of 101.15. Approximately 75% of the securities purchased are backed by 3/1 hybrid adjustable rate mortgages with the remaining pool being backed by 5/1 hybrid adjustable rate mortgages. These securities have been financed in part with debt totaling $1.1 billion.
The following table summarizes our residential mortgage-backed securities owned at December 31, 2004, classified by type of issuer or by ratings categories:
| | Par
Value | |
Coupon
| | Carrying
Value | |
Yield
|
Agency ARMs | $ | 591,372,079 | | 4.24% | $ | 598,289,982 | | 3.84% |
Non-Agency AAA - rated ARMs | | 537,105,436 | | 4.39% | | 540,896,815 | | 4.07% |
Floating Rate CMOs | | 65,577,825 | | 3.35% | | 65,557,917 | | 3.56% |
| | | | | | | | |
| | | | | | | | |
| | | | | | | | |
Total | $ | 1,194,055,34 | | 4.26% | $ | 1,204,744,714 | | 3.93% |
| | | | | | | | |
| | | | | | | | |
| | | | | | | | |
Securitized $419 Million of High-Credit Quality ARM Loans
Marking another significant milestone in the growth of the organization, the Company completed its first loan securitization of approximately $419 million of high-credit quality, first-lien, adjustable rate mortgages and hybrid adjustable rate mortgages (collectively "ARM" loans) on February 25, 2005, through New York Mortgage Trust 2005-1 (the "Trust").
Quarterly Dividends
The Company declared a cash dividend of $0.24 per share on shares of its common stock for the quarter ended December 31, 2004. The dividend was paid on January 26, 2005, to shareholders of record as of January 6, 2005. Additionally, on March 11, 2005, the Company's Board of Directors declared a cash dividend of $0.25 per share on shares of its common stock for the quarter ended March 31, 2005. The dividend is payable on April 26, 2005, to shareholders of record as of April 6, 2005. These quarterly dividends represent the distribution of the estimated net income of the New York Mortgage Trust, Inc., exclusive of any net income earned by its taxable REIT subsidiary, The New York Mortgage Company, LLC ("NYMC"), for the respective quarters.
Conference Call
Management will conduct a conference call and audio webcast at 10:00 am ET on March 16, 2005 to review the Company's quarterly results. The conference call dial-in number is 303-262-2131. The audio webcast will be available to the public, on a listen-only basis, via the Investor Relations section of the Company's website at www.nymtrust.com or at www.ccbn.com. Please allow extra time prior to the call to visit the site and download the necessary software to listen to the Internet broadcast.
About New York Mortgage Trust
New York Mortgage Trust, Inc. (NYMT) is a real estate investment trust (REIT) focused on owning and managing a leveraged portfolio of residential mortgage securities and a mortgage origination business. The mortgage portfolio is comprised largely of prime adjustable-rate and hybrid mortgage loans and securities, much of which, over time will be originated by NYMT's wholly owned mortgage origination business, The New York Mortgage Company, LLC (NYMC), a taxable REIT subsidiary. The ability to build a portion of its loan portfolio from loans internally originated is a cornerstone of NYMT's strategy.
For Further Information
AT THE COMPANY
Michael I. Wirth, Chief Financial Officer
Phone: 212-634-2342
Email: mwirth@nymtrust.com | AT FINANCIAL RELATIONS BOARD
Joe Calabrese (General) 212-827-3772
Julie Tu (Analysts) 212-827-3776 |
This news release contains forward-looking statements that predict or describe future events or trends. The matters described in these forward-looking statements are subject to known and unknown risks, uncertainties and other unpredictable factors, many of which are beyond the Company's control. The Company faces many risks that could cause its actual performance to differ materially from the results predicted by its forward-looking statements, including, without limitation, the possibilities that a rise in interest rates may cause a decline in the market value of the Company's assets, a decrease in the demand for mortgage loans may have a negative effect on the Company's volume of closed loan originations, prepayment rates may change, borrowings to finance the purchase of assets may not be available on favorable terms, the Company may not be able to maintain its qualification as a REIT for federal tax purposes, the Company may experience the risks associated with investing in real estate, including changes in business conditions and the general economy, and the Company's hedging strategies may not be effective. The reports that the Company files with the Securities and Exchange Commission contain a fuller description of these and many other risks to which the Company is subject. Because of those risks, the Company's actual results, performance or achievements may differ materially from the results, performance or achievements contemplated by its forward-looking statements. The information set forth in this news release represents management's current expectations and intentions. The Company assumes no responsibility to issue updates to the forward-looking matters discussed in this news release.
FINANCIAL TABLES FOLLOW
NEW YORK MORTGAGE TRUST, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
(unaudited)
| | For the Year Ended
December 31, 2004 | | For the Three
Months Ended
December 31, 2004 |
REVENUE: | | | | |
Gain on sales of mortgage loans | $ | 20,835,387 | $ | 5,901,954 |
Interest income: | | | | |
Loans held for sale | | 6,904,651 | | 1,202,533 |
Investment securities and loans | | 20,393,977 | | 12,734,229 |
Brokered loan fees | | 6,894,629 | | 2,496,492 |
Miscellaneous income | | 226,677 | | 55,958 |
| | | | |
Total revenue | | 55,255,321 | | 22,391,166 |
| | | | |
EXPENSES: | | | | |
Salaries, commissions and benefits | | 17,118,321 | | 5,723,912 |
Interest expense: | | | | |
Loans held for sale | | 3,542,538 | | 582,645 |
Investment securities and loans | | 12,469,980 | | 8,232,384 |
Brokered loan expenses | | 5,276,333 | | 2,139,881 |
Occupancy and equipment | | 3,528,679 | | 1,102,491 |
Marketing and promotion | | 3,189,969 | | 1,216,047 |
Data processing and communications | | 1,598,132 | | 461,662 |
Office supplies and expenses | | 1,518,927 | | 501,684 |
Professional fees | | 2,005,388 | | 917,653 |
Travel and entertainment | | 611,944 | | 218,072 |
Depreciation and amortization | | 690,489 | | 381,630 |
Other | | 638,561 | | 117,893 |
| | | | |
Total expenses | | 52,189,261 | | 21,595,954 |
| | | | |
NET INCOME FROM OPERATIONS | | 3,066,060 | | 795,212 |
Gain on sale of securities | | 774,415 | | 41,603 |
| | | | |
NET INCOME BEFORE INCOME TAX EXPENSE | | 3,840,475 | | 836,815 |
Income tax benefit | | 1,106,630 | | 1,160,025 |
| | | | |
NET INCOME | $ | 4,947,105 | $ | 1,996,840 |
| | | | |
| | | | |
| | | | |
Basic income per share | $ | 0.28 | $ | 0.11 |
| | | | |
| | | | |
| | | | |
Diluted income per share | $ | 0.27 | $ | 0.11 |
| | | | |
| | | | |
| | | | |
Weighted average shares outstanding-basic | | 17,797,375 | | 17,797,375 |
| | | | |
| | | | |
| | | | |
Weighted average shares outstanding- diluted1 | | 18,062,417 | | 18,105,179 |
| | | | |
| | | | |
| | | | |
NEW YORK MORTGAGE TRUST, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
| | | December 31,
2004
(Unaudited) | | December 31,
2003 |
ASSETS | | | | |
Cash and equivalents | $ | 7,613,106 | $ | 4,357,069 |
Restricted cash | | 2,341,712 | | 217,330 |
Marketable securities | | - | | 3,278,753 |
Investment securities available for sale | | 1,204,744,714 | | - |
Due from loan purchasers | | 79,904,315 | | 58,862,433 |
Escrow deposits - pending loan closing | | 16,235,638 | | - |
Accounts and accrued interest receivable | | 15,018,369 | | 2,707,517 |
Mortgage loans held for sale | | 85,384,927 | | 36,258,229 |
Mortgage loans held for investment | | 190,688,935 | | - |
Prepaid and other assets | | 4,351,869 | | 2,140,907 |
Derivative assets | | 3,677,572 | | 227,513 |
Property and equipment, net | | 4,801,302 | | 2,031,697 |
| | | | |
TOTAL ASSETS | $ | 1,614,762,459 | $ | 110,081,448 |
| | | | |
| | | | |
| | | | |
LIABILITIES AND STOCKHOLDERS' EQUITY | | | | |
LIABILITIES: | | | | |
Financing arrangements, portfolio investments | $ | 1,115,809,285 | $ | - |
Financing arrangements, loans held for sale | | 359,353,566 | | 90,425,133 |
Due to loan purchasers | | 350,884 | | 753,720 |
Accounts payable and accrued expenses | | 19,334,655 | | 4,277,241 |
Subordinated notes due to members | | - | | 14,706,902 |
Derivative liabilities | | 164,816 | | 261,511 |
Other liabilities | | 267,034 | | 130,566 |
| | | | |
Total liabilities | | 1,495,280,240 | | 110,555,073 |
| | | | |
COMMITMENTS AND CONTINGENCIES | | | | |
STOCKHOLDERS'/MEMBERS' EQUITY (DEFICIT): | | | | |
Common stock, $0.01 par value, 400,000,000 shares authorized; | | | | |
authorized 18,423,452 and 17,797,375 shares issued and outstanding, respectively, at December 31, 2004 | | 180,621 | | - |
Additional paid-in capital | | 116,262,216 | | - |
Members' deficit | | - | | (1,338,625) |
Accumulated earnings | | 2,783,234 | | - |
Accumulated other comprehensive (loss) income | | 256,148 | | 865,000 |
| | | | |
Total stockholders'/members' equity (deficit) | | 119,482,219 | | (473,625) |
| | | | |
TOTAL LIABILITIES AND STOCKHOLDERS'/MEMBERS' EQUITY | $ | 1,614,762,459 | $ | 110,081,448 |
| | | | |
| | | | |
| | | | |
NEW YORK MORTGAGE TRUST, INC. AND SUBSIDIARIES
SELECTED SEGMENT REPORTING
(unaudited)
| For the Year Ended December 31, 2004 |
| | Mortgage Portfolio
Management
Segment | | Mortgage Lending
Segment | | Total |
Total revenue | $ | 20,561,418 | $ | 35,468,318 | $ | 56,029,736 |
Total expense | | 13,250,297 | | 37,832,334 | | 51,082,631 |
| | | | | | |
Net income (loss) | $ | 7,311,121 | $ | (2,364,016) | $ | 4,947,105 |
| | | | | | |
| | | | | | |
| | | | | | |
Basic income per share | $ | 0.41 | $ | (0.13) | $ | 0.28 |
| | | | | | |
| | | | | | |
| | | | | | |
Diluted income per share | $ | 0.40 | $ | (0.13) | $ | 0.27 |
| | | | | | |
| | | | | | |
| | | | | | |
| For the Three Months Ended December 31, 2004 |
| | Mortgage Portfolio
Management
Segment | | Mortgage Lending
Segment | | Total |
Total revenue | $ | 12,775,832 | $ | 9,656,937 | $ | 22,432,769 |
Total expense | | 8,513,285 | | 11,922,644 | | 20,435,929 |
| | | | | | |
Net income (loss) | $ | 4,262,547 | $ | (2,265,707) | $ | 1,996,840 |
| | | | | | |
| | | | | | |
| | | | | | |
Basic income per share | $ | 0.24 | $ | (0.13) | $ | 0.11 |
| | | | | | |
| | | | | | |
| | | | | | |
Diluted income per share | $ | 0.24 | $ | (0.13) | $ | 0.11 |
| | | | | | |
| | | | | | |
| | | | | | |
Total assets | | 1,413,954,577 | | 200,807,882 | | 1,614,762,459 |
Total equity | | 107,541,994 | | 11,940,225 | | 119,482,219 |
