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AG Mortgage Investment Trust, Inc. Reports First Quarter 2021 Results

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AG Mortgage Investment Trust, Inc. ("MITT," "we," the "Company" or "our") (NYSE: MITT) today reported financial results for the quarter ended March 31, 2021.

Q1 2021 PERFORMANCE AND HIGHLIGHTS

Financial Performance

  • $4.92 Book Value per share and $4.76 Adjusted Book Value per share as of March 31, 2021, as compared to $4.13 and $3.94 as of December 31, 2020, respectively(1)(2)
    • Adjusted Book Value subtracts the full liquidation preference of our preferred stock from total equity, which does not reflect underwriting discounts and offering expenses incurred at issuance that impact our Book Value
    • Adjusted Book Value per share increased $0.82, or 20.8%, primarily due to mark-to-market gains on our Residential and Commercial portfolios, as well as income generated at Arc Home
  • Quarterly Economic Return of 22.3%(3)
  • $0.91 of Net Income per diluted common share for Q1 2021, as compared to $1.16 for Q4 2020(1)
    • Includes retrospective adjustment of $0.01 per share in Q1 2021 related to our agency portfolio
  • $0.08 of Core Earnings per share for Q1 2021, as compared to $0.22 for Q4 2020(1)
    • Q4 2020 Core Earnings per share was elevated by record origination volumes produced by Arc Home coupled with elevated gain on sale margins experienced throughout the industry

First Quarter Activity

  • Continued to reposition our investment portfolio, increasing our concentration of residential investments through the acquisition of Non-QM Loans and Agency RMBS
  • Declared dividends of $0.06 per common share in March 2021
  • Declared and paid $5.0 million of preferred dividends during the quarter
  • Exchanged 0.5 million shares of preferred stock, at a slight discount to par, for 2.8 million shares of common stock in a private exchange offer
  • Utilized ATM program to raise approximately $10.0 million in net proceeds through the issuance of approximately 2.2 million shares of common stock at a weighted average price of $4.53 per share

MANAGEMENT REMARKS

"We are pleased with the performance we achieved during the quarter while executing on our strategic goals," said David Roberts, Chief Executive Officer. "We delivered an economic return of approximately 22% during the first quarter which was reflective of our increased common dividend of $0.06 per share. Our increase in adjusted book value was driven by a rise in the value of our residential whole loan and CMBS portfolios as well as continued strong performance from Arc Home."

"We increased the size of our investment portfolio to $1.9 billion mainly through purchases of Non-QM Loans and Agency RMBS. We also took advantage of strong credit markets to sell commercial and Non-Agency securities, continuing our progress of shifting the portfolio into residential whole loans," said T.J. Durkin, President. Mr. Durkin also added, "During the quarter, we executed another accretive opportunity to strengthen our capital base by completing a preferred stock exchange offer and also utilized our ATM program to raise approximately $10 million through the issuance of common stock."

"Recent regulatory, structural and market changes have set the backdrop for what will likely be the most dynamic period for investing in the new origination non-agency residential space in decades," said Chief Investment Officer, Nicholas Smith. "As a result of these changes coupled with mortgage credit availability at levels last seen almost a decade ago, we are confident that we will be able to prudently grow our Non-Agency loan portfolio by delivering our origination partners attractive product offerings."

Q1 2021 PORTFOLIO AND FINANCING UPDATE

Investment Portfolio

  • $1.9 billion Investment Portfolio(4)(5) and 2.6x Economic Leverage Ratio(6) as of March 31, 2021, as compared to $1.4 billion and 1.5x, respectively, as of December 31, 2020
    • Increased our Non-QM Loan and Agency RMBS portfolios through net purchases of $208.5 million and $443.6 million, respectively
    • Sold two Commercial Loans and several CMBS and Non-Agency RMBS to support growth in our residential portfolios

Financing

  • $1.2 billion of MTM recourse financing and $422.9 million of non-MTM non-recourse financing as of March 31, 2021, as compared to $580.1 million and $466.3 million, respectively, as of December 31, 2020(a)
    • At March 31, 2021, MITT had total liquidity of $51.6 million of cash, as compared to total liquidity of $54.2 million as of December 31, 2020
  • Repaid $10 million secured note and accrued interest to our Manager upon maturity on March 31, 2021

(a) As of March 31, 2021, total financing of $1.6 billion includes financing arrangements of $1.2 billion, collateralized by various asset types in our investment portfolio, and securitized debt of $344.4 million, collateralized by Re/Non-Performing Loans. As of December 31, 2020, total financing of $1.0 billion includes financing arrangements of $680.8 million, collateralized by various asset types in our investment portfolio; securitized debt of $355.2 million, collateralized by Re/Non-Performing Loans; and a secured loan from the Manager of $10.4 million.(5)

INVESTMENT PORTFOLIO

The following summarizes the Company’s investment portfolio as of March 31, 2021(4)(5):

($ in millions)

 

Fair Value

 

Percent of Fair
Value

 

Allocated
Equity(7)

 

Percent of Equity

Residential Investments(a)

 

$

876.8

 

46.2

%

 

$

281.9

 

61.9

%

Agency RMBS(a)

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AG Mortgage Investment Trust, Inc.

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