In This Article:
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GAAP Net Income: $9.1 million, or $0.29 per diluted share.
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Earnings Available for Distribution (EAD): $3.3 million, or $0.10 per share.
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Book Value per Common Share: $3.82 as of December 31, down from $4.02 on September 30.
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Comprehensive Loss: $1.5 million, or $0.05 per diluted share.
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Operating Expenses: $4.5 million for the quarter.
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Unrestricted Cash: $46 million at quarter end.
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Financial Leverage: 5.3 times at the end of the quarter.
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MSR Portfolio Market Value: Approximately $234 million.
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RMBS Portfolio Value: Approximately $723 million as of December 31.
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RMBS Net Interest Spread: 2.9% for the fourth quarter.
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Dividend Declared: $0.15 per common share for the fourth quarter.
Release Date: March 06, 2025
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
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Cherry Hill Mortgage Investment Corp (NYSE:CHMI) successfully completed the internalization of management, which is expected to reduce operating expenses by $1.1 million to $1.6 million in 2025.
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The MSR portfolio saw gains quarter over quarter, contributing positively to the company's financial performance.
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The company maintained a solid liquidity profile with $46 million of unrestricted cash on the balance sheet.
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Cherry Hill Mortgage Investment Corp (NYSE:CHMI) generated GAAP net income of $0.29 per diluted share for the fourth quarter.
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The RMBS portfolio's prepayment speeds remained relatively steady, indicating stability in the portfolio's performance.
Negative Points
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The company's book value per common share decreased from $4.02 to $3.82 by the end of the year.
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Higher interest rates and increased volatility negatively impacted the RMBS portfolio.
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The comprehensive loss attributable to common stockholders was $1.5 million for the fourth quarter.
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The company's financial leverage remained high at 5.3 times, indicating potential risk in a volatile market.
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Operating expenses were elevated due to special committee-related expenses, impacting earnings available for distribution.
Q & A Highlights
Q: Can you clarify where the special committee expenses and the benefits from internalization will appear in the financial statements? A: Michael Hutchby, CFO: The special committee expenses are included in the SG&A line item on the income statement. Going forward, the benefits from internalization will be reflected in reduced management fees and increased compensation and benefits, which will also be part of SG&A.
Q: How are elevated interest rates affecting the cost of repurchase agreements, and is there a strategy to mitigate these costs? A: Julian Evans, CIO: Some of the higher costs were due to year-end expenses as we used the Street's balance sheet. These costs have decreased in the first quarter, and we are seeing some benefits.