Sachem Capital(SACH) - 2024 4 - Earnings Call Transcript

Financial Data and Key Metrics Changes - Revenue totaled $57.5 million, including$43.2 million in interest income, $8.6 million in fees from loans, and$5.2 million from LLC partnership investments [30] - Operating and other costs totaled $97.1 million, resulting in a GAAP net loss of$39.6 million, and a net loss available to common shareholders of $43.9 million after preferred stock dividends [30][31] - Book value per common share at year-end 2024 was$2.64, down from $3.83 in 2023, reflecting a year-over-year change of$1.19 [33][37] Business Line Data and Key Metrics Changes - The non-performing loan book grew year-over-year by $18.3 million to$102.9 million, with $36.3 million in foreclosure status [8][57] - The company funded approximately$134 million in loans, modifications, and extensions during the year [14] - The portfolio included 157 loans with a gross principal value of $377 million and a weighted average contractual interest rate of 12.53$5.1 million in revenues, representing a low-risk double-digit yield [20] Company Strategy and Development Direction - The company aims to stabilize its portfolio and position itself for future opportunities by removing non-performing loans and focusing on higher quality loans [9][10] - The company is pursuing a diversification strategy through partnerships, such as with Schemcrete Capital, to enhance its real estate finance capabilities [19][48] - The company plans to selectively build a pipeline of development projects to minimize completion risk and capture market rate earnings [16] Management's Comments on Operating Environment and Future Outlook - Management acknowledged the challenges faced in 2024 due to restrictive bank lending policies and increased construction costs, impacting borrowers' ability to refinance [7] - The company is optimistic about its financial position moving into 2025, with a focus on protecting liquidity and seeking cost-effective capital [22][49] - Management expressed confidence in resolving non-performing loans and expects to generate sufficient cash flow to meet upcoming obligations [25][50] Other Important Information - The company closed on a new credit facility with Needham Bank, providing up to $50 million of committed liquidity [21] - The board declared a quarterly common dividend of$0.05 per share, aligning future dividend declarations with preferred stock payments [46] Q&A Session Summary Question: What is the balance for the loans in non-accrual and foreclosure status as of Q4? - Non-performing loans are approximately $100 million as of December 31st, with significant progress made in resolving them [55] Question: Can you provide specifics on the loan sales? - The total UPB in the loan sale was$55.8 million, comprising 32 loans, with an average realization of around 68% [79][80] Question: What is the status of unfunded loan commitments? - Approximately $54 million in unfunded commitments exists, expected to be funded ratably over the year [72]