Atrium Mortgage Investment Corporation Announces First Quarter Results with Strong Quarterly Net Income

Rhea-AI Summary

Atrium Mortgage Investment (TSX: AI) announced its financial results for Q1 2024, reporting a net income of $12.0 million, down 15.3% from the previous year. Basic and diluted EPS were $0.27. The mortgage portfolio grew to $886.1 million, a 4.8% increase compared to Q1 2023. The portfolio remained high quality, with 96.7% in first mortgages and an average loan-to-value of 64.0%. Revenues increased by 6.3% to $25.2 million, but the allowance for mortgage losses was raised to $24.9 million (2.81% of the portfolio). Despite a 4.8% portfolio growth, assets declined slightly from $877.9 million to $868.3 million, and mortgages receivable decreased to $867.1 million. The weighted average interest rate on the mortgage portfolio dropped marginally to 11.25% from 11.42%.

Positive

• Q1 revenues increased by 6.3% to $25.2 million.
• Mortgage portfolio grew by 4.8% to $886.1 million.
• 96.7% of the portfolio are first mortgages.
• Average loan-to-value ratio is a conservative 64.0%.
• Dividend declared was $0.225 per share.

Negative

• Net income decreased by 15.3% to $12.0 million.
• Allowance for mortgage losses increased to $24.9 million (2.81% of the portfolio).
• Basic and diluted EPS decreased to $0.27 from $0.33 and $0.31, respectively.
• Assets declined slightly from $877.9 million to $868.3 million.
• Mortgages receivable decreased to $867.1 million.

Toronto, Ontario--(Newsfile Corp. - May 14, 2024) - Atrium Mortgage Investment Corporation (TSX: AI) (TSX: AI.DB.C) (TSX: AI.DB.D) (TSX: AI.DB.E) (TSX: AI.DB.F) (TSX: AI.DB.G) today released its financial results for the three month period ended March 31, 2024.

Highlights

• Quarterly basic and diluted earnings per share of $0.27

• Quarterly net income of $12.0 million

• Mortgage portfolio of $886.1 million, up 4.8% over Q1 of the prior year

• High quality mortgage portfolio

  • 96.7% of portfolio in first mortgages

  • 91.2% of portfolio is less than 75% loan to value

  • average loan-to-value is 64.0%

"Atrium began 2024 with another strong quarter. Earnings per share of $0.27 was consistent with our fourth quarter results and significantly exceeded the dividends declared of $0.225. Our lending program is specifically targeting lower risk sectors in order to protect shareholder capital during this downturn in the cycle. Maintaining a defensive portfolio remains our top priority. At quarter end, the weighted average loan to value on the mortgage portfolio remained conservative at 64.0%, and 96.7% of Atrium's mortgages were first mortgages. Despite the mortgage portfolio performing well in Q1, we decided to increase our allowance for mortgage losses in recognition of the continued challenges experienced by real estate markets across Canada. While the prospect of lower rates and easing inflation in the second half of the year should improve market conditions, we intend to remain diligent in managing the existing portfolio and continue to focus on our preferred sectors for new loan business," said Rob Goodall, CEO of Atrium.

Conference call

Interested parties are invited to participate in a conference call with management on Wednesday, May 15, 2024 at 4:00 p.m. ET to discuss the results. To participate or listen to the conference call live, please call 1-833-491-0507 (call topic: First quarter results). For a replay of the conference call (available until May 28, 2024) please call 1-833-607-0619, password 6057203#.

Results of operations

For the three month period ended March 31, 2024, Atrium reported assets of $868.3 million, slightly down from $877.9 million at the end of 2023. Revenues were $25.2 million, an increase of 6.3% from the first quarter of the prior year. Net income for first quarter of 2024 was $12.0 million, a decrease of 15.3% from the first quarter of the prior year. Atrium's allowance for mortgage losses at March 31, 2024 totaled $24.9 million, or 2.81% of the mortgage portfolio, which is up from $22.6 million or 2.53% of the mortgage portfolio at December 31, 2023.

Basic and diluted earnings per common share were $0.27, for the three months ended March 31, 2024, compared with $0.33 and $0.31 basic and diluted earnings per common share in the comparative period, a decrease of 18.2% (basic) and 12.9% (diluted).

Mortgages receivable as at March 31, 2024 was $867.1 million, down from $876.7 million as at December 31, 2023. During the three month period ended March 31 2024, $78.4 million of mortgage principal was advanced and $81.6 million was repaid. The weighted average interest rate on the mortgage portfolio at March 31, 2024 was 11.25%, compared to 11.42% at December 31, 2023.

Financial summary
Interim Consolidated Statements of Income and Comprehensive Income
(Unaudited, 000s, except per share amounts)

		Three months ended
		March 31
		2024			2023
Revenue	$	25,193		$	23,707
Mortgage servicing and management fees		(2,076	)		(2,054	)
Other expenses		(406	)		(444	)
Recovery of prior mortgage losses		-			157
Provision for mortgage losses		(3,854	)		(952	)
Income before financing costs		18,857			20,414
Financing costs		(6,816	)		(6,202	)
Net income and comprehensive income	$	12,041		$	14,212
Basic earnings per share	$	0.27		$	0.33
Diluted earnings per share	$	0.27		$	0.31
Dividends declared	$	9,931		$	9,785
Mortgages receivable, end of period	$	867,078		$	840,019
Total assets, end of period	$	868,279		$	854,511
Shareholders' equity, end of period	$	487,276		$	482,763
Book value per share, end of period	$	11.02		$	11.08

 

Analysis of mortgage portfolio

	As at March 31, 2024								As at December 31, 2023
				Outstanding			% of					Outstanding			% of
Property Type	Number			amount			Portfolio		Number			amount			Portfolio
(outstanding amounts in 000s)
High-rise residential	21		$	318,497			35.9%		22		$	323,340			36.2%
Mid-rise residential	23			179,523			20.3%		25			208,289			23.3%
Low-rise residential	15			155,859			17.6%		14			153,561			17.2%
House and apartment	164			125,089			14.1%		153			117,943			13.2%
Condominium corporation	10			1,691			0.2%		10			1,786			0.2%
Residential portfolio	233			780,659			88.1%		224			804,919			90.1%
Commercial	17			105,429			11.9%		19			88,640			9.9%
Mortgage portfolio	250		$	886,088			100.0%		243		$	893,559			100.0%

 

	As at March 31, 2024
										Weighted			Weighted
										average			average
Location of underlying property	Number of mortgages			Outstanding amount			Percentage outstanding			loan to value			interest rate
(outstanding amounts in 000s)
Greater Toronto Area	173		$	667,028			75.3%			60.8%			11.40%
Non-GTA Ontario	55			41,449			4.7%			64.8%			9.85%
British Columbia	21			170,161			19.2%			75.7%			10.89%
Alberta	1			7,450			0.8%			71.0%			14.00%
	250		$	886,088			100.0%			64.0%			11.25%

 

	As at December 31, 2023
										Weighted			Weighted
										average			average
Location of underlying property	Number of mortgages			Outstanding amount			Percentage outstanding			loan to value			interest rate
(outstanding amounts in 000s)
Greater Toronto Area	166		$	653,401			73.1%			61.4%			11.63%
Non-GTA Ontario	52			40,753			4.6%			64.6%			9.81%
British Columbia	24			191,955			21.5%			60.6%			10.95%
Alberta	1			7,450			0.8%			71.0%			14.00%
	243		$	893,559			100.0%			61.4%			11.42%

 

For further information on the financial results, and further analysis of the company's mortgage portfolio, please refer to Atrium's consolidated financial statements and its management's discussion and analysis for the year ended March 31, 2024, available on SEDAR+ at www.sedarplus.ca, and on the company's website at www.atriummic.com.

About Atrium

Canada's Premier Non-Bank Lender™
Atrium is a non-bank provider of residential and commercial mortgages that lends in major urban centres in Canada where the stability and liquidity of real estate are high. Atrium's objectives are to provide its shareholders with stable and secure dividends and preserve shareholders' equity by lending within conservative risk parameters. Atrium is a Mortgage Investment Corporation (MIC) as defined in the Canada Income Tax Act, so is not taxed on income provided that its taxable income is paid to its shareholders in the form of dividends within 90 days after December 31 each year. Such dividends are generally treated by shareholders as interest income, so that each shareholder is in the same position as if the mortgage investments made by the company had been made directly by the shareholder. For further information about Atrium, please refer to regulatory filings available at www.sedarplus.ca or investor information on Atrium's website at www.atriummic.com.

For additional information, please contact

Robert G. Goodall
Chief Executive Officer

John Ahmad
Chief Financial Officer

(416) 867-1053
info@atriummic.com
www.atriummic.com

To view the source version of this press release, please visit https://www.newsfilecorp.com/release/209167

FAQ

What were Atrium's earnings per share for Q1 2024?

Atrium reported basic and diluted earnings per share of $0.27 for Q1 2024.

What is Atrium's mortgage portfolio value as of Q1 2024?

Atrium's mortgage portfolio was valued at $886.1 million as of Q1 2024.

How did Atrium's net income perform in Q1 2024?

Atrium's net income for Q1 2024 was $12.0 million, a 15.3% decrease from the previous year.

What percentage of Atrium's mortgage portfolio are first mortgages?

96.7% of Atrium's mortgage portfolio consists of first mortgages.

What was the average loan-to-value ratio of Atrium's mortgage portfolio in Q1 2024?

The average loan-to-value ratio was 64.0% in Q1 2024.

What was Atrium's revenue for Q1 2024?

Atrium's revenue for Q1 2024 was $25.2 million, up 6.3% from the previous year.

How did Atrium's assets change in Q1 2024?

Atrium's assets slightly declined from $877.9 million to $868.3 million in Q1 2024.

What was the allowance for mortgage losses for Atrium in Q1 2024?

The allowance for mortgage losses was $24.9 million or 2.81% of the portfolio in Q1 2024.

What was the weighted average interest rate on Atrium's mortgage portfolio in Q1 2024?

The weighted average interest rate was 11.25% in Q1 2024.

What were Atrium's declared dividends for Q1 2024?

Atrium declared dividends of $0.225 per share for Q1 2024.