MITT - Earnings call transcript Q3 2020 | AG Mortgage Investment Trust, Inc.

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Operator

Welcome to the AG Mortgage Investment Trust Third Quarter 2020 Earnings Call. My name is John, and I'll be your operator for today's call. [Operator Instructions]. Please note, the conference is being recorded. And I will now turn the call over to Raul Moreno.

Raul Moreno

John. you, Thank and Call everyone, the Quarter Third Good AG welcome Mortgage Earnings for Investment XXXX morning, to Trust, Inc.

please may MD&A Any are outlined Before forward-looking today's to certain these read today's The our begin, our note the uncertainties, information actual subject the we results which and presentation discussed call regarding conference from are SEC the materially call to you statements Risk contain filings. forward-looking statements. earnings in risks forward-looking company's made during contained that earnings statements. of on Factors SEC our encourage sections differ We our in release, statements disclosure may filings. in in and and

SEC will to the measures. today, to non-GAAP call most comparable we the GAAP During refer for filings measures. reconciliations to certain our financial Please refer

XXXX also www.agmit.com, With will morning. this to view our We was that that, the click call welcome, us the presentation like turn over and and I our you on Roberts. the Presentation our reference CEO, posted for presentation, to today. to thank website to QX joining David home page. the Earnings turn website, link Again, slide would on To earnings the

David Roberts

book is common The of stock, up and to that report $X.XX for taking June be that of on our focus preferred Raul, unpaid account to comparison increased as book book and September continues pleased $X.XX XX, I'm share as of maintaining per increasing to value. company AG the good you, dividends adequate from Trust $X.XX morning of June while creating XX, and Mortgage into Investment September Thank value the XX. as $X.XX After up of XX. compared power from everyone. to earnings liquidity value up share and - GAAP our of as per same accumulated

progress leverage continued to below X:X. the we mark-to-market overall our make ratio and in in maintaining our During reducing quarter, leverage

to the led $XX.X liquidity to XX. increased our September that activities upon as in at originator In the million, Our set of earnings for liquidity million like their the exceeding second of June record touch Arc I'd improved up earnings, to quarter. highlight another will number T.J. of quarter. Arc the affiliate, $XX.X record XX our from this a third Home. performance quarter, mortgage

its the also During significantly record third profits and Mae portfolio. Arc's quarter, sale liquidity. Arc Both Ginnie sold that servicing legacy increased Arc's

MITT our channels. continue Arc We see the in substantial through origination to longer for origination other opportunities and both over term residential

call declare the accumulated Finally, turn December shares. from preferred given XX Durkin, Chief Officer. that, to will and our to the improved quarter dividend dividends quarters our of will paid be With and dividends All on the the decided second unpaid and Investment to I liquidity our have third year. on T.J. shares position, we declare fourth this on preferred over

Thomas Durkin

Thank you, David, good and morning, everyone.

our nonrecourse our funds. $XX.X additional other those, debt. acquired we and out Turning subsequently X, our million line, and future to reducing of We and RPLs assets on the Ginnie of In Angelo in rated our high-level securitized To we August, Mae existing mark-to-market debt affiliate favor our warehouse a with we walk had you settled through certain along our non-QM with sold funding various XXXX, we presentation Gordon positions. second an on including Page for loan CMBS and commitments further MSRs, also complement investments, CRE quarter. like an NPLs activity terming securitization of

into the to its of compliance company Lastly, the agency whole ability exemption from with back registration we qualify approximately under bringing an purchased Act. pools, for $XXX the million 'XX

another the new our strong continues performance at to fully advantage in to the want Arc of the originator. of we volume banking Again, mortgage Arc of quarter X. channels. sector take record The tailwinds Slide to and licensed margins the agency with within Home, Turning highlight team mortgage

stated quarter's one as the to non-QM first to the the are continue and healthy of of And origination at by reenter funds. last space, Home, reminder, that pipeline originators a pace. to approximately As was Angelo on seeing the grow a MITT also remainder just is company and product the owns call, controlled for Arc we and Gordon-managed we XX% owned other

metrics. lay out Slide to Turning X, we our portfolio

fair purchase not approximately on representing Our largely the With of economic overall X.X over inclusive a improvement within securities $X.XX to increase investment we the that, had of was commercial the as saw was credit X/XX, and turn previously mentioned lastly, dramatic Brian at expected. I'll hand leverage. products improved and to and portfolio during Home Arc securities. The results. XX% loans, securities third of less size The market of quarter, and call in the turns cash the the for of fashion This is XX% XX% driven by the approximately portfolio most all of financial albeit billion And residential was the our the agency value quarter, to than a which agency portfolio loans. be company. credit review second conditions investment in

Brian Sigman

fully Overall the available of diluted share. or $XX for net we million T.J. common $X.XX third Thanks, earnings quarter, to reported stockholders per

record was from due During million performance. pickup Arc our $XX.X the quarter, their to equity earnings Home

restructuring-related income expenses, this our quarter the quarter. on of for million order separated in which clarity $X.X statement out we've earnings outsized offset our to Our expenses operating to were by add

XX. would increased to after value the dividends lower at During preferred $X.XX book Book our quarter, the accumulated at September unpaid and XX. deducting be $X.XX value outstanding September

earnings, preferred repayment of will QX. Consistent Board by are in with value management financial would share evaluate paid core the amount help financial dividends, non-GAAP we with our operating we evaluate or performance next the last not investors other measures currently a quarter, As But earnings disclosing the all whether the decrease book per non-GAAP core accumulated measure. quarter. declared has will

lowered X termed securitizations our on our costs. loan and side, portfolios funding that quarter and executed the our financing we active On financing had residential an out

under with $XX of have leverage counterparties and we prepared unencumbered call ended million, of continue open to million $XX to consisting concludes with X securities. the of remains as cash liquidity Our the like Xx, now our September for and remarks, total $XX outstanding and million of agency we questions. We of XX. debt would economic That quarter Operator?

Operator

[Operator Instructions]. Suisse. our from Doug Harter And first question from is Crédit

Douglas Harter

First, talk mix you for can portfolio, you are the right what the of your think going about what about forward? plans kind is how

David Roberts

T.J?

Thomas Durkin

obviously where we've legacy were quarter spent sure, successful Yes, in sort the market. think, and I I liability we're mean enhancing best of the it, pretty of the competitive, we're But call last value. spent out or canvassing some last, so, at mean, looking XX optimizing and market the profile. days in We that's where of I some loans. the whole relative acquiring our we Doug. And there's investments. is there sort

Douglas Harter

as you during fourth make kind of I 'XX, funds were Okay. of think improvement liability you do your of guess of cost into And said the just third the the then that, look quarter in in can you you kind of where just improving structure. kind you forward on quarter? relative how much an to

Thomas Durkin

Yes.

- think about So I that. sorry,

David Roberts

to want Do take you it?

Thomas Durkin

Yes.

on continue see not the then parts. month. just levels I - would Not but to advantage them towards probably improve on pretty regular to the that term repo, dramatically. but can way And those funds pre-COVID and come. we're quite sort every of of levels, closer grinding we nonrecourse probably closer debt, had out, warehouses we've I in One, assets and two think we of also answered taken the markets terming getting both say, cost terms it's and taking in non-mark-to-market, of,

So we do still think come portfolio. there's probably our for improvement there to

Operator

Securities. Our next question JMP from is Cranston from Trevor

Trevor Cranston

follow-up the any I a potentially particular be if composition. where might a extent where A are portfolio credit capital the think think for to the sectors question comment portfolio? portfolio tightening continued sales upside areas on would additional the right. can the can of from occur? of you new would And deployment and products, might guess you be be seen to or there in areas opportunistic you there's look spread there you in light likely that on lot not of where about remaining sales, All say we've of lot you

Thomas Durkin

Trevor, another. And better within But is at the bit I book security don't you more into very get any feel, managing there's portfolio, least a we side, residential broad-based. than when own we're on it's a sector the or asset-specific. the think - in side, that particular It's little commercial sale obviously one our it's accordingly.

Trevor Cranston

say Okay. XQ? your forward, head outlook XXXX? you was front Got on it. can disclose seeing sort can you're you're Arc margins what looking Home, where what And of at into XQ? as we today And margin then you And gain-on-sale that the as versus is for

Thomas Durkin

Yes.

it's drift say can I on through the haven't I to over expect quarter. for is disclosed would exact date, on do largely What We gain QX it sale the tell you unchanged. We to number QX. lower remained

seems So longer start I down. assume it to X highest that the people think to margins will we but X, would head XXXX, we But do be thought, months us, come are expect, say, have lasting than would we as ago. into margins most behind

Operator

questions this time. [Operator Instructions]. And at seeing am I no further

Raul Moreno

Thanks. Great.

the everyone, to you quarter. think I we next joining. call. can Thanks, end for speak We'll

David Roberts

day, everyone. good a Have

Operator

gentlemen. participating, today's you Thank may and call. now and for That concludes Thank disconnect. you, ladies you

AG Mortgage Investment Trust (MITT) 7 Nov 202020 Q3 Earnings call transcript