Sunrise Realty Trust, Inc. Announces Financial Results for Fourth Quarter and Year Ended 2024

Rhea-AI Summary

Sunrise Realty Trust (NASDAQ:SUNS) has reported its financial results for Q4 and full-year 2024. The company achieved Q4 GAAP net income of $1.9 million ($0.27 per share) and Distributable Earnings of $2.0 million ($0.30 per share). For the full year 2024, SUNS recorded GAAP net income of $6.9 million ($1.01 per share) and Distributable Earnings of $7.2 million ($1.07 per share).

The company has demonstrated strong deal momentum, successfully committing to $75.0 million in deals during Q4, followed by an additional $74.8 million in commitments through March 1. SUNS has declared a regular cash dividend of $0.30 per common share for Q1 2025, payable on April 15, 2025, to shareholders of record as of March 31, 2025.

Positive

• Strong deal flow with $75M new commitments in Q4
• Additional $74.8M deals committed post-quarter through March 1
• Consistent quarterly dividend of $0.30 per share maintained
• Positive Distributable Earnings of $7.2M for full-year 2024

Negative

• None.

Insights

Financial Analyst

Sunrise Realty Trust's Q4 and full-year 2024 results demonstrate operational stability with strategic growth initiatives. The REIT posted Q4 GAAP net income of $1.9 million ($0.27 per share) and Distributable Earnings of $2.0 million ($0.30 per share). Full-year figures showed GAAP net income of $6.9 million ($1.01 per share) and Distributable Earnings of $7.2 million ($1.07 per share).

Particularly noteworthy is the alignment between the declared Q1 2025 dividend of $0.30 per share and the Q4 Distributable Earnings of $0.30 per share, indicating a 100% payout ratio. This perfect alignment suggests management is prioritizing dividend sustainability while maximizing shareholder returns from available earnings.

The company's deal pipeline shows substantial momentum, with $75 million in deal commitments during Q4 and another $74.8 million post-quarter through March 1st. Combined, these commitments total $149.8 million – nearly matching the company's entire $152.5 million market capitalization. This significant transaction volume relative to company size indicates an aggressive growth strategy that could materially impact future earnings if successfully deployed.

SUNS's focus on transitional commercial real estate in Southern U.S. markets positions them in regions experiencing population growth, though execution quality will be important given the varying conditions across commercial real estate sectors. The precise matching of distributable earnings to dividend payout warrants monitoring, as it leaves little room for dividend growth without corresponding earnings improvement or potential pressure on the dividend if performance softens.

Fourth quarter 2024 GAAP net income of $1.9 million or $0.27 per basic weighted average common share and Distributable Earnings⁽¹⁾ of $2.0 million or $0.30 per basic weighted average common share

Year ended 2024 GAAP net income of $6.9 million or $1.01 per basic weighted average common share and Distributable Earnings⁽¹⁾ of $7.2 million or $1.07 per basic weighted average common share

WEST PALM BEACH, Fla., March 06, 2025 (GLOBE NEWSWIRE) -- Sunrise Realty Trust, Inc. (NASDAQ:SUNS) (“SUNS” or the “Company”) today announced its results for the fourth quarter and year ended December 31, 2024.

SUNS reported generally accepted accounting principles (“GAAP”) net income of $1.9 million or $0.27 per basic weighted average common share and Distributable Earnings of $2.0 million or $0.30 per basic weighted average common share for the fourth quarter of 2024. The Company reported GAAP net income of $6.9 million or $1.01 per basic weighted average common share and Distributable Earnings of $7.2 million or $1.07 per basic weighted average common share for the year ended 2024.

“Our performance this quarter highlights the momentum the team has achieved since our listing as an independent, public company,” said Brian Sedrish, the Company’s Chief Executive Officer. “In the fourth quarter, SUNS successfully committed to $75.0 million in deals, and subsequent to quarter-end through March 1, we committed to another $74.8 million in deals. Our continued execution across a diverse opportunity set is positioning us to drive long-term value for our shareholders while expanding our presence in key Southern U.S. markets.”

Common Stock Dividend

On March 4, 2025, the Company’s Board of Directors declared a regular cash dividend of $0.30 per common share for the first quarter of 2025. The dividend is payable on April 15, 2025, to shareholders of record as of March 31, 2025.

Additional Information

SUNS issued a presentation, titled “Fourth Quarter and Full Year 2024 Investor Presentation,” which can be viewed at www.sunriserealtytrust.com under the Investor Relations section. The Company also filed its Annual Report on Form 10-K for the year ended December 31, 2024, with the Securities and Exchange Commission on March 6, 2025.

SUNS routinely posts important information for investors on its website, www.sunriserealtytrust.com. The Company intends to use this webpage as a means of disclosing material information, for complying with our disclosure obligations under Regulation FD and to post and update investor presentations and similar materials on a regular basis. SUNS encourages investors, analysts, the media and others interested in SUNS to monitor the Investors section of its website, in addition to following its press releases, SEC filings, public conference calls, presentations, webcasts and other information posted from time to time on the website. To sign-up for email-notifications, please visit the “Email Alerts” section of the website under the “IR Resources” section.

Conference Call & Discussion of Financial Results

SUNS will host a conference call at 10:00 am (Eastern Time) on Thursday, March 6, 2025, to provide an update on the business. All interested parties are welcome to participate. The call will be available through a live audio webcast at the Investor Relations section of SUNS’s website found here: SUNS – Investor Relations. To participate via telephone, please register in advance at this link. Upon registration, all telephone participants will receive a confirmation email detailing how to join the conference call, including the dial-in number along with a unique passcode and registrant ID that can be used to access the call. The complete webcast will be archived for 90 days on the Investor Relations section of SUNS’ website.

About Sunrise Realty Trust, Inc.

Sunrise Realty Trust, Inc. (Nasdaq: SUNS) is an institutional commercial real estate lender providing flexible financing solutions to sponsors of commercial real estate located in the Southern United States. We focus on transitional commercial real estate business plans with opportunities for near-term value creation, collateralized by top-tier real property assets in established Southern cities presenting strong growth fundamentals. For additional information regarding the Company, please visit www.sunriserealtytrust.com.

Non-GAAP Metrics

In addition to using certain financial metrics prepared in accordance with GAAP to evaluate our performance, we also use Distributable Earnings to evaluate our performance excluding the effects of certain transactions and GAAP adjustments we believe are not necessarily indicative of our current loan activity and operations. Distributable Earnings is a measure that is not prepared in accordance with GAAP. Distributable Earnings and the other capitalized terms not defined in this section have the meanings ascribed to such terms in our most recently filed quarterly report. We use this non-GAAP financial measure both to explain our results to shareholders and the investment community and in the internal evaluation and management of our businesses. Our management believes that this non-GAAP financial measure and the information they provide are useful to investors since these measures permit investors and shareholders to assess the overall performance of our business using the same tools that our management uses to evaluate our past performance and prospects for future performance.

The determination of Distributable Earnings is substantially similar to the determination of Core Earnings under our Management Agreement, provided that Core Earnings is a component of the calculation of any Incentive Compensation earned under the Management Agreement for the applicable time period, and thus Core Earnings is calculated without giving effect to Incentive Compensation expense, while the calculation of Distributable Earnings account for any Incentive Compensation earned for such time period. We define Distributable Earnings as, for a specified period, the net income (loss) computed in accordance with GAAP, excluding (i) stock-based compensation expense, (ii) depreciation and amortization, (iii) any unrealized gains, losses or other non-cash items recorded in net income (loss) for the period, regardless of whether such items are included in other comprehensive income or loss, or in net income (loss); provided that Distributable Earnings does not exclude, in the case of investments with a deferred interest feature (such as original issue discount, debt instruments with PIK interest and zero coupon securities), accrued income that we have not yet received in cash, (iv) provision for (reversal of) current expected credit losses (“CECL”), (v) taxable REIT (as defined below) subsidiary (“TRS”) (income) loss, net of any dividends received from TRS and (vi) one-time events pursuant to changes in GAAP and certain non-cash charges, in each case after discussions between our Manager and our independent directors and after approval by a majority of such independent directors.

We believe providing Distributable Earnings on a supplemental basis to our net income as determined in accordance with GAAP is helpful to shareholders in assessing the overall performance of our business. As a real estate investment trust (“REIT”), we are required to distribute at least 90% of our annual REIT taxable income, subject to certain adjustments, and to pay tax at regular corporate rates to the extent that we annually distribute less than 100% of such taxable income. Given these requirements and our belief that dividends are generally one of the principal reasons that shareholders invest in our common stock, we generally intend to attempt to pay dividends to our shareholders in an amount at least equal to such REIT taxable income, if and to the extent authorized by our Board of Directors. Distributable Earnings is one of many factors considered by our Board of Directors in authorizing dividends and, while not a direct measure of net taxable income, over time, the measure can be considered a useful indicator of our dividends.

Distributable Earnings is a non-GAAP financial measure and should not be considered as a substitute for GAAP net income. We caution readers that our methodology for calculating Distributable Earnings may differ from the methodologies employed by other REITs to calculate the same or similar supplemental performance measures, and as a result, our reported Distributable Earnings may not be comparable to similar measures presented by other REITs.

SUNRISE REALTY TRUST, INC. CONSOLIDATED STATEMENTS OF OPERATIONS
	Three Months Ended December 31, 2024				Year Ended December 31, 2024
Revenue
Interest income	$	3,617,906			$	10,844,718
Interest expense		(173,071	)			(216,268	)
Net interest income		3,444,835				10,628,450
Expenses
Management and incentive fees		393,063				815,301
General and administrative expenses		697,204				1,291,021
Stock-based compensation		178,265				338,404
Professional fees		306,480				1,275,123
Total expenses		1,575,012				3,719,849
(Provision for) reversal of current expected credit losses		(15,853	)			(40,180	)
Net income before income taxes		1,853,970				6,868,421
Income tax expense		—				—
Net income	$	1,853,970			$	6,868,421
Earnings per common share:
Basic earnings per common share	$	0.27			$	1.01
Diluted earnings per common share	$	0.27			$	1.00
Weighted average number of common shares outstanding:
Basic weighted average shares of common stock outstanding		6,801,152				6,800,841
Diluted weighted average shares of common stock outstanding		6,846,122				6,835,797
Dividends declared per share of common stock2	$	0.42			$	0.63

The following table provides a reconciliation of GAAP Net income to Distributable Earnings:

	Three Months Ended December 31, 2024				Year Ended  December 31, 2024
Net income	$	1,853,970			$	6,868,421
Adjustments to net income:
Stock-based compensation expense		178,265				338,404
Depreciation and amortization		—				—
Unrealized (gains) losses, or other non-cash items		—				—
Provision for (reversal of) current expected credit losses		15,853				40,180
TRS (income) loss		—				—
One-time events pursuant to changes in GAAP and certain non-cash charges		—				—
Distributable earnings	$	2,048,088			$	7,247,005
Basic weighted average shares of common stock outstanding		6,801,152				6,800,841
Distributable earnings per basic weighted average share	$	0.30			$	1.07

Forward-Looking Statements

This release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 that reflect our current views and projections with respect to, among other things, future events and financial performance. Words such as “believes,” “expects,” “will,” “intends,” “plans,” “guidance,” “estimates,” “projects,” “anticipates,” and “future” or similar expressions are intended to identify forward-looking statements. These forward-looking statements, including statements about our future growth and strategies for such growth, are subject to the inherent uncertainties in predicting future results and conditions and are not guarantees of future performance, conditions or results. Certain factors, including the ability of our manager to locate suitable loan opportunities for us, monitor and actively manage our loan portfolio and implement our investment strategy; the demand for commercial real estate investment; management’s current estimate of expected credit losses and current expected credit loss reserve and other factors could cause actual results and performance to differ materially from those projected in these forward-looking statements. More information on these risks and other potential factors that could affect our business and financial results is included in SUNS’s filings with the SEC, including in the “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” sections of SUNS’s Information Statement filed as Exhibit 99.1 to Form 8-K filed on July 3, 2024 and subsequently filed Annual Reports on Form 10-K. New risks and uncertainties arise over time, and it is not possible to predict those events or how they may affect SUNS. We do not undertake any obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law.

Investor Relations Contact:

Robyn Tannenbaum

(561) 510-2293

ir@sunriserealtytrust.com

Media Contact:

Profile Advisors

Rich Myers & Rachel Goun

347-774-1125

rmyers@profileadvisors.com

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¹ Distributable Earnings is a non-GAAP financial measure. See the “Non-GAAP Metrics” section of this release for a reconciliation of GAAP Net Income to Distributable Earnings.
² There is no assurance dividends will continue at these levels or at all.

FAQ

What were Sunrise Realty Trust's (SUNS) Q4 2024 earnings per share?

SUNS reported Q4 2024 GAAP earnings of $0.27 per share and Distributable Earnings of $0.30 per share.

How much in new deals did SUNS commit to in Q4 2024?

SUNS committed to $75.0 million in deals during Q4 2024, with an additional $74.8 million committed through March 1.

What is the Q1 2025 dividend amount for Sunrise Realty Trust (SUNS)?

SUNS declared a regular cash dividend of $0.30 per common share for Q1 2025, payable on April 15, 2025.

What was Sunrise Realty Trust's (SUNS) full-year 2024 net income?

SUNS reported full-year 2024 GAAP net income of $6.9 million ($1.01 per share) and Distributable Earnings of $7.2 million ($1.07 per share).