The following is a summary of the ACRES Commercial Realty Corp. (ACR) Q4 2023 Earnings Call Transcript:
Financial Performance:
ACRES Commercial Realty Corp. reported Q4 net income of $1.7 million or $0.20 per share, including an increase of $1.1 million to CECL reserves.
Loan payoffs totaled $98.3 million with a net decrease to the loan portfolio of $64.7 million.
The company completed a new commitment of $29.7 million with net funded commitments during the quarter at $3.9 million.
Earnings available for distribution (EAD) was $0.55 per share, decreased from Q3's $0.73 per share.
The company's GAAP book value per share increased to $26.65 from $25.07 at the end of Q3, due mainly to the share buyback program.
Business Progress:
The commercial real estate loan portfolio stood at $1.9 billion, comprising 70 individual investments with 11 rated four or five.
Four loans migrated into higher-risk categories, but this doesn't necessarily mean a significant principal loss.
ACRES is working to monetize several real estate investments to offset NOL carryforwards and reinvest back into the loan portfolio.
Their strategy focuses on improving credit quality and recycling capital into performing categories.
With a challenging mortgage market in 2023, they plan to monetize some investments to offset NOL, allowing capital redeployment towards the loan book, ultimately driving additional EAD.
Discussions are also underway regarding a dividend to return capital to shareholders.
More details: ACRES Commercial IR
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