TPG RE Finance Trust, Inc. Reports Operating Results for the Quarter Ended September 30, 2024
Regarding third quarter results, Doug Bouquard, Chief Executive Officer of TRTX, said: “Over the past quarter, TRTX delivered strong operating earnings, outearned our dividend by more than
THIRD QUARTER 2024 ACTIVITY
-
Recognized GAAP net income attributable to common stockholders of
, or$18.7 million per common share, based on a diluted weighted average share count of 81.4 million common shares. Book value per common share was$0.23 as of September 30, 2024.$11.41 -
Generated Distributable Earnings of
, or$23.0 million per common share, based on a diluted weighted average share count of 81.4 million common shares.$0.28 -
Declared on September 13, 2024 a cash dividend of
per share of common stock which was paid on October 25, 2024 to common stockholders of record as of September 27, 2024. The Company paid on September 30, 2024 to stockholders of record as of September 20, 2024 a quarterly dividend on its$0.24 6.25% Series C Cumulative Redeemable Preferred Stock of per share.$0.39 06 -
Originated three first mortgage loans with total loan commitments of
, an initial aggregate unpaid principal balance of$204.0 million , a weighted average interest rate of Term SOFR plus$199.8 million 3.17% , a weighted average interest rate floor of3.33% and a weighted average as-is loan-to-value ratio of63.3% . Additionally, funded of future funding obligations associated with previously originated and acquired loans.$7.6 million -
Received loan repayments of
, including three full loan repayments of$149.3 million , involving the following property types:$141.1 million 41.5% hotel;35.8% multifamily; and22.7% mixed-use. - Weighted average risk rating of the Company’s loan portfolio was 3.0 as of September 30, 2024, unchanged from June 30, 2024.
-
Carried at quarter-end an allowance for credit losses of
, a decrease of$69.3 million from$0.3 million as of June 30, 2024. The quarter-end allowance equals 205 basis points of total loan commitments as of September 30, 2024 compared to 208 basis points as of June 30, 2024.$69.6 million -
Ended the quarter with
of near-term liquidity:$357.0 million of cash-on-hand available for investment, net of$211.3 million held to satisfy liquidity covenants under the Company’s secured financing agreements; undrawn capacity under secured financing arrangements of$15.0 million ; and undrawn capacity under asset-specific financing arrangements and secured revolving credit facility of$128.1 million .$2.6 million -
Increased non-recourse, non-mark-to-market asset specific financings by
. Non-mark-to-market borrowings represented$72.0 million 79.7% of total borrowings at September 30, 2024.
SUBSEQUENT EVENTS
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Received full loan repayments of two multifamily first mortgage loans with aggregate total loan commitments and aggregate unpaid principal balances of
and$70.6 million , respectively. The loans carried a risk rating of 3.0 as of September 30, 2024.$70.6 million
The Company issued a supplemental presentation detailing its third quarter 2024 operating results, which can be viewed at http://investors.tpgrefinance.com/.
CONFERENCE CALL AND WEBCAST INFORMATION
The Company will host a conference call and webcast to review its financial results with investors and other interested parties at 9:00 a.m. ET on Wednesday, October 30, 2024. To participate in the conference call, callers from
REPLAY INFORMATION
A replay of the conference call will be available after 12:00 p.m. ET on Wednesday, October 30, 2024 through 11:59 p.m. ET on Wednesday, November 13, 2024. To access the replay, listeners may use +1 (844) 512-2921 (domestic) or +1 (412) 317-6671 (international). The passcode for the replay is 13745416. The replay will be available on the Company’s website for one year after the call date.
ABOUT TRTX
TPG RE Finance Trust, Inc. is a commercial real estate finance company that originates, acquires, and manages primarily first mortgage loans secured by institutional properties located in primary and select secondary markets in
FORWARD-LOOKING STATEMENTS
This earnings release contains “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. These forward-looking statements are subject to various risks and uncertainties, including, without limitation, statements relating to the performance of the investments of TPG RE Finance Trust, Inc. (the “Company” or “TRTX”); global economic trends and economic conditions, including heightened inflation, slower growth or recession, changes to fiscal and monetary policy, higher interest rates, stress to the commercial banking systems of the
Non-GAAP Financial Measures Reconciliation
Distributable Earnings
Distributable Earnings is a non-GAAP measure, which we define as GAAP net income (loss) attributable to our common stockholders, including realized gains and losses from loan write-offs, loan sales and other loan resolutions (including conversions to real estate owned (“REO”)), regardless of whether such items are included in other comprehensive income or loss, or in GAAP net income (loss), and excluding (i) non-cash stock compensation expense, (ii) depreciation and amortization expense, (iii) unrealized gains (losses) (including credit loss expense (benefit), net), and (iv) certain non-cash or income and expense items. The exclusion of depreciation and amortization expense from the calculation of Distributable Earnings only applies to debt investments related to real estate to the extent we foreclose upon the property or properties underlying such debt investments.
We believe that Distributable Earnings provides meaningful information to consider in addition to our net income (loss) and cash flow from operating activities determined in accordance with GAAP. We generally must distribute at least
Distributable Earnings excludes the impact of our credit loss provision or reversals of our credit loss provision, but only to the extent that our credit loss provision exceeds any realized credit losses during the applicable reporting period.
A loan will be written off as a realized loss when it is deemed non-recoverable or upon a realization event. Such a realized loss would generally be recognized at the time the loan receivable is settled, transferred or exchanged, or in the case of foreclosure, when the underlying property is foreclosed upon or sold. Non-recoverability may also be concluded by us if, in our determination, it is nearly certain that all amounts due will not be collected. A realized loss may equal the difference between the cash or consideration received or expected to be received, and the net book value of the loan, reflecting our economics as it relates to the ultimate realization of the asset.
Distributable Earnings does not represent net income (loss) or cash generated from operating activities and should not be considered as an alternative to GAAP net income (loss), an indication of our GAAP cash flows from operations, a measure of our liquidity, or an indication of funds available for our cash needs. In addition, our methodology for calculating Distributable Earnings may differ from the methodologies employed by other companies to calculate the same or similar supplemental performance measures, and accordingly, our reported Distributable Earnings may not be comparable to the Distributable Earnings reported by other companies.
Reconciliation of GAAP Net Income Attributable to Common Stockholders to Distributable Earnings
The table below reconciles GAAP net income attributable to common stockholders and related diluted per share amounts to Distributable Earnings and related diluted per share amounts ($ in thousands, except per share data):
|
Three Months Ended, |
||||||
|
September 30, 2024 |
|
Per Diluted Share(1) |
||||
Net income attributable to common stockholders |
$ |
18,676 |
|
|
$ |
0.23 |
|
Depreciation and amortization |
|
3,453 |
|
|
|
0.04 |
|
Non-cash stock compensation expense |
|
1,141 |
|
|
|
0.01 |
|
Credit loss (benefit), net |
|
(301 |
) |
|
|
— |
|
Distributable earnings before realized losses from loan sales and other loan resolutions |
$ |
22,969 |
|
|
$ |
0.28 |
|
Realized loss on loan write-offs, loan sales and REO conversions |
|
— |
|
|
|
— |
|
Distributable earnings |
$ |
22,969 |
|
|
$ |
0.28 |
|
Weighted average common shares outstanding, diluted |
|
81,365,205 |
|
|
|
_______________________________ |
||
(1) |
Numbers presented may not foot due to rounding. |
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INVESTOR RELATIONS
+1 (212) 405-8500
IR@tpgrefinance.com
MEDIA
TPG RE Finance Trust, Inc.
Courtney Power
+1 (415) 743-1550
media@tpg.com
Source: TPG RE Finance Trust, Inc.