Item 2.02 Results of Operations and Financial Condition.
Preliminary Unaudited Results for the Three Months Ended
On
For the three months ended
The Company estimates its combined book value per share to be in the range of
As of
During the three months ended
During the three months ended
The Company estimates that the Company's portfolio based on total unpaid
principal balance as of
The Company estimates that our portfolio based on total unpaid principal balance
as of
The Company estimates that our portfolio based on net equity as of
During the three months ended
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The preliminary estimates set forth herein are subject to completion, including
the completion of customary financial statement closing and review procedures
for the three months ended
These preliminary estimates are based upon a number of assumptions. Additional
items that may require adjustments to these preliminary estimates may be
identified and could result in material changes to these preliminary estimates.
Non-GAAP Financial Measures
Reconciliation of Expected Core Earnings to Expected Net Income Attributable to Common Stockholders
The table below reconciles estimated Core Earnings to estimated net income
attributable to common stockholders for the three months ended
For the Three Months Ended March 31, 2021 Estimated Net income attributable to common stockholders $ 7,990
Adjustments
Amortization of stock-based compensation 391 Unrealized (gains)1 (5,508 ) Estimated Core Earnings $ 2,873 Weighted-average common shares outstanding - basic 5,023 Weighted-average common shares outstanding - diluted2 5,411 Estimated Core Earnings per Diluted Weighted-Average Share $ 0.53
(1) Unrealized gains are the net change in unrealized (gains)/losses on
investments held at fair value applicable to common stockholders.
(2) Weighted-average diluted shares outstanding does not include the dilutive
effect of redeemable non-controlling interests.
The Company uses Core Earnings to evaluate the Company's performance excluding the effects of certain GAAP adjustments and transactions that the Company believes are not indicative of its current operations. Core Earnings is a measure that is not prepared in accordance with GAAP. The Company defines Core Earnings as net income (loss) attributable to our common stockholders computed in accordance with GAAP, including realized gains and losses not otherwise included in net income (loss), excluding any unrealized gains or losses or other similar non-cash items that are included in net income (loss) for the applicable reporting period, regardless of whether such items are included in other comprehensive income (loss), or in net income (loss) and adding back amortization of stock-based compensation.
The Company believes that providing Core Earnings as a supplement to GAAP net income (loss) to our investors is helpful to their assessment of our performance. Core Earnings should not be used as a substitute for GAAP net income (loss). The Company's methodology used to calculate Core Earnings may differ from other REITs. As such, our Core Earnings may not be comparable to similar measures provided by other REITs. The Company also uses Core Earnings as a component of the management fee paid to its manager.
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Reconciliation of Expected CAD to Expected Net Income Attributable to Common Stockholders
The table below reconciles estimated CAD to estimated net income attributable to common stockholders for the three months endedMarch 31, 2021 based on the midpoint of the ranges. For the Three Months Ended March 31, 2021 Estimated Net income attributable to common stockholders $ 7,990
Adjustments
Amortization of stock-based compensation 391 Amortization of premiums 618 Unrealized (gains)(1) (5,508 ) Accretion of discounts (676 ) Estimated CAD $ 2,815 Weighted-average common shares outstanding - basic 5,023 Weighted-average common shares outstanding - diluted2 5,411 Estimated CAD per Diluted Weighted-Average Share $ 0.52
(1) Unrealized gains are the net change in unrealized (gains)/losses on
investments held at fair value applicable to common stockholders.
(2) Weighted-average diluted shares outstanding does not include the dilutive
effect of redeemable non-controlling interests.
The Company uses CAD to evaluate its performance and its ability to pay dividends. CAD is a measure that is not prepared in accordance with GAAP. The Company calculates CAD by adjusting net income (loss) attributable to common stockholders by adding back amortization of stock-based compensation, amortization of premiums, and by removing the change in unrealized loss on our investments held at fair value and accretion of discounts.
The Company believes that providing CAD as a supplement to GAAP net income (loss) to its investors is helpful to their assessment of its performance. CAD does not represent net income or cash flows from operating activities and should not be considered as an alternative to GAAP net income, an indication of our GAAP cash flows from operating activities, a measure of our liquidity or an indication of funds available for our cash needs. The Company's methodology used to calculate CAD may differ from other REITs. As such, our CAD may not be comparable to similar measures provided by other REITs.
The information included under this Item 2.02 is intended to be filed and
incorporated into the Company's Securities Act of 1933 and Securities Exchange
Act of 1934 filings, including the Company's registration statement on Form S-3
and prospectus supplements filed with the
8.01 Other Events
On
The Company is also disclosing the supplemental portfolio information attached hereto as Exhibit 99.2, which is incorporated herein by reference.
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Item 9.01. Financial Statements and Exhibits.
(d) Exhibits. Exhibit Number Exhibit Description 4.1 Indenture, datedApril 13, 2021 , by and between the Company andUMB Bank, National Association 99.1 Press Release of the Company, datedApril 13, 2021 99.2 Supplemental Portfolio Information
Cautionary Statement regarding Forward-Looking Statements
This Current Report on Form 8-K contains "forward-looking statements" within the
meaning of the Private Securities Litigation Reform Act of 1995 that are based
on management's current expectations, assumptions and beliefs. Forward-looking
statements can often be identified by words such as "anticipate," "estimate,"
"expect," "intend," "may," "should" and similar expressions, and variations or
negatives of these words. These forward-looking statements include, but are not
limited to, statements regarding the preliminary first quarter results and
portfolio information. They are not guarantees of future results and
forward-looking statements are subject to risks, uncertainties and assumptions
that could cause actual results to differ materially from those expressed in any
forward-looking statement, including the Company's financial closing and review
procedures, final adjustments and other developments that may arise between the
date of this Current Report on Form 8-K and when first quarter 2021 results are
finalized, the ultimate geographic spread, duration and severity of the COVID-19
pandemic, and the effectiveness of actions taken, or actions that may be taken,
by governmental authorities to contain the outbreak or treat its impact, as well
as those described in greater detail in our filings with the
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