Ellington Financial LLC Reports Third Quarter 2018 Results
Highlights
-
Net income1 of
$6.7 million , or$0.22 per basic and diluted share. -
Book value per share as of
September 30, 2018 of$19.37 on a diluted basis, after payment of a quarterly dividend of$0.41 per share, as compared to book value per share of$19.57 on a diluted basis as ofJune 30, 2018 . -
Credit strategy gross income of
$11.0 million for the quarter, or$0.36 per share. -
Agency strategy gross income of
$0.7 million for the quarter, or$0.02 per share. -
Net investment income of
$11.7 million for the quarter, or$0.38 per share; Adjusted net investment income2 of$12.5 million for the quarter, or$0.40 per share. -
Announced a dividend of
$0.41 per share for the third quarter of 2018, equating to an annualized dividend yield of 10.6% based on theNovember 6, 2018 closing price of$15.43 per share; dividends are paid quarterly in arrears. -
Debt-to-equity ratio of 3.04:13 as of
September 30, 2018 .
1 Increase (decrease) in shareholders' equity from
operations, or "net income (loss)."
2 Adjusted
net investment income is a non-GAAP financial measure. See
"Reconciliation of Adjusted Net Investment Income to Net Income" below
for an explanation regarding the calculation of Adjusted net investment
income.
3 Excludes repo borrowings on U.S. Treasury
securities.
Third Quarter 2018 Results
The Company's results in the third quarter reflected the continued
growth of its credit portfolio, which increased 15% sequentially and
drove net investment income of
"Most significantly for the quarter, we were able to maintain the strong
growth of our credit portfolio and our net investment income," said
"We believe that our robust growth demonstrates the strength of our origination and sourcing capabilities, as well as the benefits of a diversified portfolio. Our larger portfolio this quarter reflects the continued growth of our non-QM loan strategy, where we have reached critical mass for a second securitization. We have also begun to originate and acquire residential bridge loans, a business where we see the potential for very attractive risk-adjusted returns on equity.
"Finally, our emphasis on hedging interest rates and certain credit risks in our portfolio, along with a commitment to maintaining moderate leverage and a strong balance sheet, should continue to provide significant protection to book value, particularly as interest rates rise and volatility returns to the market."
Corporate Structure Update
The Company continues to evaluate potential changes to its tax status. Although it has not completed its analysis or made any final decision, the Company currently expects, barring any unforeseen impediments, to convert from a publicly traded partnership to a REIT in the first half of 2019. In connection with such a conversion, the Company would expect to take several steps to help qualify as a REIT, including selling certain non-real-estate-related assets, and moving other non-real-estate-related assets into taxable REIT subsidiaries. A REIT conversion would also be facilitated by exchanging a portion of the Company's existing public senior unsecured notes for private notes issued by one or more of its taxable subsidiaries.
Financial Results
The Company's total long Credit portfolio4 was
During the third quarter, the Company's Credit strategy generated total
gross income of
The Company's Credit portfolio continued to be the primary driver of its
earnings. During the third quarter, the Company's Credit strategy
generated net interest income5 of 17.7 million, net realized
and change in net unrealized losses of
Interest rates rose and Agency RMBS prices declined again during the
quarter, which led to net realized and unrealized losses on the
Company's Agency portfolio of
4 Excludes hedges, other derivative, and corporate relative
value trading positions. Also excludes tranches of the Company's
consolidated non-QM securitization trust that were sold to third
parties. Including such tranches, the Company's total long Credit
portfolio was
5 Excludes any
interest income and interest expense items from Net interest rate hedges
and Net credit hedges and other activities.
6 Excludes
any interest income and interest expense items from Net interest rate
hedges and other activities.
The following table summarizes the Company's investment portfolio
holdings as of
September 30, 2018 | June 30, 2018 | ||||||||||||||||||
(In thousands) | Fair Value | Cost | Fair Value | Cost | |||||||||||||||
Long: | |||||||||||||||||||
Credit: | |||||||||||||||||||
Dollar Denominated: | |||||||||||||||||||
CLO(1) | $ | 156,087 | $ | 160,561 | $ | 210,935 | $ | 216,236 | |||||||||||
CMBS | 14,923 | 13,995 | 16,927 | 16,890 | |||||||||||||||
Commercial Mortgage Loans and REO(2) | 160,515 | 158,159 | 139,546 | 137,846 | |||||||||||||||
Consumer Loans and ABS Backed by Consumer Loans(1) | 209,848 | 218,183 | 196,584 | 205,243 | |||||||||||||||
Corporate Debt and Equity | 44,559 | 43,250 | 71,422 | 68,878 | |||||||||||||||
Debt and Equity Investment in Mortgage-Related Entities | 30,171 | 25,314 | 30,823 | 25,314 | |||||||||||||||
Non-Agency RMBS | 180,223 | 168,399 | 156,834 | 144,760 | |||||||||||||||
Residential Mortgage Loans and REO | 393,846 | 392,634 | 294,366 | 292,994 | |||||||||||||||
Non-Dollar Denominated: | |||||||||||||||||||
CLO | — | — | 4,670 | 4,788 | |||||||||||||||
CMBS | 16,250 | 16,774 | 16,309 | 16,468 | |||||||||||||||
Consumer Loans and ABS Backed by Consumer Loans | 919 | 825 | 8,723 | 899 | |||||||||||||||
Corporate Debt and Equity | 11,400 | 12,165 | 11,911 | 12,576 | |||||||||||||||
RMBS(3) | 199,108 | 200,416 | 130,395 | 128,620 | |||||||||||||||
Agency: | |||||||||||||||||||
Fixed-Rate Specified Pools | 850,453 | 877,590 | 853,120 | 874,862 | |||||||||||||||
Floating-Rate Specified Pools | 5,539 | 5,684 | 6,155 | 6,304 | |||||||||||||||
IOs | 33,050 | 34,134 | 32,899 | 33,630 | |||||||||||||||
Reverse Mortgage Pools | 55,396 | 57,552 | 56,371 | 58,104 | |||||||||||||||
TBAs | 303,552 | 304,331 | 317,013 | 316,530 | |||||||||||||||
Government: | |||||||||||||||||||
Dollar Denominated | 4,230 | 4,257 | 70,468 | 70,467 | |||||||||||||||
Total Long | 2,670,069 | 2,694,223 | 2,625,471 | 2,631,409 | |||||||||||||||
Repurchase Agreements | |||||||||||||||||||
Dollar Denominated | 140,352 | 140,352 | 194,230 | 194,229 | |||||||||||||||
Non-Dollar Denominated | 20,070 | 20,116 | 20,181 | 20,117 | |||||||||||||||
Total Repurchase Agreements | 160,422 | 160,468 | 214,411 | 214,346 | |||||||||||||||
Short: | |||||||||||||||||||
Credit: | |||||||||||||||||||
Dollar Denominated: | |||||||||||||||||||
Corporate Debt and Equity | (60,809 | ) | (60,965 | ) | (84,395 | ) | (85,280 | ) | |||||||||||
Agency: | |||||||||||||||||||
TBAs | (562,098 | ) | (564,232 | ) | (618,665 | ) | (616,872 | ) | |||||||||||
Government: | |||||||||||||||||||
Dollar Denominated | (52,809 | ) | (52,884 | ) | (159,220 | ) | (159,005 | ) | |||||||||||
Non-Dollar Denominated | (19,633 | ) | (19,605 | ) | (19,866 | ) | (19,668 | ) | |||||||||||
Total Short | (695,349 | ) | (697,686 | ) | (882,146 | ) | (880,825 | ) | |||||||||||
Net Total | $ | 2,135,142 | $ | 2,157,005 | $ | 1,957,736 | $ | 1,964,930 |
(1) |
Includes equity investment in a securitization-related vehicle. |
|
(2) |
Includes equity investment in a limited liability company holding small balance commercial mortgage loans. |
|
(3) |
Includes RMBS secured by non-performing loans and REO, and an investment in an entity holding a securitization call right. |
|
The following table summarizes the Company's operating results for the
quarters ended
Quarter Ended | % of | Quarter | % of | Nine-Month Period | % of | |||||||||||||||||||||||||||||||||||||
September |
Per | Average | Ended June | Per | Average | Ended September | Per | Average | ||||||||||||||||||||||||||||||||||
30, 2018 |
Share | Equity | 30, 2018 | Share | Equity | 30, 2018 | Share | Equity | ||||||||||||||||||||||||||||||||||
(In thousands, except per share amounts) | ||||||||||||||||||||||||||||||||||||||||||
Credit: | ||||||||||||||||||||||||||||||||||||||||||
Interest income and other income | $ | 26,522 | $ | 0.86 | 4.32 | % | $ | 23,053 | $ | 0.75 | 3.75 | % | $ | 70,120 | $ | 2.25 | 11.41 | % | ||||||||||||||||||||||||
Net realized gain (loss) | 9,845 | 0.32 | 1.60 | % | 105 | — | 0.01 | % | 14,911 | 0.48 | 2.43 | % | ||||||||||||||||||||||||||||||
Change in net unrealized gain (loss) | (9,886 | ) | (0.32 | ) | (1.61 | )% | 11,046 | 0.36 | 1.80 | % | 8,840 | 0.28 | 1.44 | % | ||||||||||||||||||||||||||||
Net interest rate hedges(1) | 468 | 0.02 | 0.08 | % | 29 | — | — | % | 676 | 0.02 | 0.11 | % | ||||||||||||||||||||||||||||||
Net credit hedges and other activities(2) | (3,250 | ) | (0.11 | ) | (0.53 | )% | 1,659 | 0.05 | 0.27 | % | (396 | ) | (0.01 | ) | (0.06 | )% | ||||||||||||||||||||||||||
Interest expense(3) | (8,786 | ) | (0.28 | ) | (1.43 | )% | (7,680 | ) | (0.25 | ) | (1.25 | )% | (23,113 | ) | (0.74 | ) | (3.76 | )% | ||||||||||||||||||||||||
Other investment related expenses | (3,921 | ) | (0.13 | ) | (0.64 | )% | (3,288 | ) | (0.11 | ) | (0.53 | )% | (9,828 | ) | (0.32 | ) | (1.60 | )% | ||||||||||||||||||||||||
Total Credit profit (loss) | 10,992 | 0.36 | 1.79 | % | 24,924 | 0.80 | 4.05 | % | 61,210 | 1.96 | 9.97 | % | ||||||||||||||||||||||||||||||
Agency RMBS: | ||||||||||||||||||||||||||||||||||||||||||
Interest income | 7,873 | 0.25 | 1.28 | % | 8,345 | 0.27 | 1.36 | % | 22,911 | 0.74 | 3.73 | % | ||||||||||||||||||||||||||||||
Net realized gain (loss) | (1,388 | ) | (0.04 | ) | (0.23 | )% | (1,509 | ) | (0.05 | ) | (0.25 | )% | (4,084 | ) | (0.13 | ) | (0.66 | )% | ||||||||||||||||||||||||
Change in net unrealized gain (loss) | (6,167 | ) | (0.20 | ) | (1.00 | )% | (4,151 | ) | (0.14 | ) | (0.67 | )% | (22,909 | ) | (0.74 | ) | (3.73 | )% | ||||||||||||||||||||||||
Net interest rate hedges and other activities(1) | 5,510 | 0.18 | 0.90 | % | 3,406 | 0.12 | 0.56 | % | 19,155 | 0.62 | 3.12 | % | ||||||||||||||||||||||||||||||
Interest expense | (5,087 | ) | (0.17 | ) | (0.83 | )% | (4,439 | ) | (0.14 | ) | (0.73 | )% | (12,997 | ) | (0.42 | ) | (2.12 | )% | ||||||||||||||||||||||||
Total Agency RMBS profit (loss) | 741 | 0.02 | 0.12 | % | 1,652 | 0.06 | 0.27 | % | 2,076 | 0.07 | 0.34 | % | ||||||||||||||||||||||||||||||
Total Credit and Agency RMBS profit (loss) | 11,733 | 0.38 | 1.91 | % | 26,576 | 0.86 | 4.32 | % | 63,286 | 2.03 | 10.31 | % | ||||||||||||||||||||||||||||||
Other interest income (expense), net | 347 | 0.01 | 0.06 | % | 497 | 0.02 | 0.09 | % | 1,242 | 0.04 | 0.20 | % | ||||||||||||||||||||||||||||||
Other expenses | (4,182 | ) | (0.14 | ) | (0.68 | )% | (4,598 | ) | (0.15 | ) | (0.75 | )% | (12,832 | ) | (0.41 | ) | (2.09 | )% | ||||||||||||||||||||||||
Net increase in equity resulting from operations (before incentive fee) | 7,898 | 0.25 | 1.29 | % | 22,475 | 0.73 | 3.66 | % | 51,696 | 1.66 | 8.42 | % | ||||||||||||||||||||||||||||||
Incentive fee | (424 | ) | (0.01 | ) | (0.07 | )% | (291 | ) | (0.01 | ) | (0.05 | )% | (715 | ) | (0.02 | ) | (0.12 | )% | ||||||||||||||||||||||||
Net increase (decrease) in equity resulting from operations | $ | 7,474 | $ | 0.24 | 1.22 | % | $ | 22,184 | $ | 0.72 | 3.61 | % | $ | 50,981 | $ | 1.64 | 8.30 | % | ||||||||||||||||||||||||
Less: Net increase (decrease) in equity resulting from operations attributable to non-controlling interests | 813 | 991 | 2,089 | |||||||||||||||||||||||||||||||||||||||
Net increase (decrease) in shareholders' equity resulting from operations(4) | $ | 6,661 | $ | 0.22 | 1.12 | % | $ | 21,193 | $ | 0.69 | 3.53 | % | $ | 48,892 | $ | 1.58 | 8.18 | % | ||||||||||||||||||||||||
Weighted average shares and convertible
units(5) outstanding |
30,859 | 30,907 | 31,098 | |||||||||||||||||||||||||||||||||||||||
Average equity (includes non-controlling interests)(6) | $ | 613,816 | $ | 612,622 | $ | 614,426 | ||||||||||||||||||||||||||||||||||||
Weighted average shares and LTIP units outstanding(7) | 30,647 | 30,695 | 30,886 | |||||||||||||||||||||||||||||||||||||||
Average shareholders' equity (excludes non-controlling interests)(6) | $ | 596,204 | $ | 597,870 | $ | 597,625 |
(1) |
Includes TBAs and U.S. Treasury securities, if applicable. |
|
(2) |
Includes equity and other relative value trading strategies and related hedges. |
|
(3) |
Includes interest expense on the Company's Senior Notes. |
|
(4) |
Per share information is calculated using weighted average shares and LTIP units outstanding. Percentage of average equity is calculated using average shareholders' equity, which excludes non-controlling interests. |
|
(5) |
Convertible units include Operating Partnership units attributable to non-controlling interests and LTIP units. |
|
(6) |
Average equity and average shareholders' equity are calculated using month end values. |
|
(7) |
Excludes Operating Partnership units attributable to non-controlling interests. |
|
About
Conference Call
The Company will host a conference call at
A dial-in replay of the conference call will be available on
Cautionary Statement Regarding Forward-Looking Statements
This press release contains forward-looking statements within the
meaning of the safe harbor provisions of the Private Securities
Litigation Reform Act of 1995. Forward-looking statements involve
numerous risks and uncertainties. Actual results may differ from the
Company's beliefs, expectations, estimates, and projections and,
consequently, you should not rely on these forward-looking statements as
predictions of future events. Forward-looking statements are not
historical in nature and can be identified by words such as "believe,"
"expect," "anticipate," "estimate," "project," "plan," "continue,"
"intend," "should," "would," "could," "goal," "objective," "will,"
"may," "seek," or similar expressions or their negative forms, or by
references to strategy, plans, or intentions. Examples of
forward-looking statements in this press release include without
limitation management's beliefs regarding the current economic and
investment environment and the Company's ability to implement its
investment and hedging strategies, performance of the Company's
investment and hedging strategies, the Company's exposure to prepayment
risk in its Agency portfolio, estimated effects on the fair value of the
Company's holdings of a hypothetical change in interest rates,
statements regarding the drivers of the Company's returns, the Company's
expected ongoing annualized expense ratio, statements regarding
potential changes to the Company's corporate structure, and statements
regarding the Company's intended dividend policy including the amount to
be recommended by management, and the Company's share repurchase
program. The Company's results can fluctuate from month to month and
from quarter to quarter depending on a variety of factors, some of which
are beyond the Company's control and/or are difficult to predict,
including, without limitation, changes in interest rates and the market
value of the Company's securities, changes in mortgage default rates and
prepayment rates, the Company's ability to borrow to finance its assets,
changes in government regulations affecting the Company's business, the
Company's ability to maintain its exclusion from registration under the
Investment Company Act of 1940 and other changes in market conditions
and economic trends. Furthermore, forward-looking statements are subject
to risks and uncertainties, including, among other things, those
described under Item 1A of the Company's Annual Report on Form 10-K
filed on
ELLINGTON FINANCIAL LLC CONSOLIDATED STATEMENT OF OPERATIONS (UNAUDITED) |
|||||||||||||||
Three-Month Period Ended |
Nine-Month |
||||||||||||||
(In thousands, except per share amounts) |
September 30, |
June 30, 2018 |
September 30, |
||||||||||||
Investment income | |||||||||||||||
Interest income | $ | 35,300 | $ | 31,941 | $ | 95,333 | |||||||||
Other income | 1,046 | 1,094 | 2,857 | ||||||||||||
Total investment income | 36,346 | 33,035 | 98,190 | ||||||||||||
Expenses | |||||||||||||||
Base management fee to affiliate (Net of fee rebates of $423, $252, and $950, respectively) | 1,830 | 2,021 | 5,829 | ||||||||||||
Incentive fee to affiliate | 424 | 291 | 715 | ||||||||||||
Interest expense | 15,678 | 13,383 | 40,624 | ||||||||||||
Other investment related expenses: | |||||||||||||||
Servicing and other | 4,384 | 3,771 | 11,107 | ||||||||||||
Other operating expenses | 2,352 | 2,578 | 7,004 | ||||||||||||
Total expenses | 24,668 | 22,044 | 65,279 | ||||||||||||
Net investment income | 11,678 | 10,991 | 32,911 | ||||||||||||
Net realized gain (loss) on: | |||||||||||||||
Investments | 8,551 | (388 | ) | 20,747 | |||||||||||
Financial derivatives, excluding currency hedges | 479 | (3,632 | ) | (2,251 | ) | ||||||||||
Financial derivatives—currency hedges | 297 | 3,787 | 1,881 | ||||||||||||
Foreign currency transactions | 775 | (1,110 | ) | 1,433 | |||||||||||
10,102 | (1,343 | ) | 21,810 | ||||||||||||
Change in net unrealized gain (loss) on: | |||||||||||||||
Investments | (13,372 | ) | 7,457 | (12,767 | ) | ||||||||||
Other secured borrowings | (358 | ) | 414 | 840 | |||||||||||
Financial derivatives, excluding currency hedges | 173 | 6,553 | 9,922 | ||||||||||||
Financial derivatives—currency hedges | 528 | 76 | 1,404 | ||||||||||||
Foreign currency translation | (1,277 | ) | (1,964 | ) | (3,139 | ) | |||||||||
(14,306 | ) | 12,536 | (3,740 | ) | |||||||||||
Net realized and change in net unrealized gain (loss) on investments, financial derivatives, and other secured borrowings | (4,204 | ) | 11,193 | 18,070 | |||||||||||
Net increase in equity resulting from operations | 7,474 | 22,184 | 50,981 | ||||||||||||
Less: Increase in equity resulting from operations attributable to non-controlling interests | 813 | 991 | 2,089 | ||||||||||||
Net increase in shareholders' equity resulting from operations | $ | 6,661 | $ | 21,193 | $ | 48,892 | |||||||||
Net increase in shareholders' equity resulting from operations per share: | |||||||||||||||
Basic and diluted | $ | 0.22 | $ | 0.69 | $ | 1.58 | |||||||||
Weighted average shares and LTIP units outstanding | 30,647 | 30,695 | 30,886 | ||||||||||||
Weighted average shares and convertible units outstanding | 30,859 | 30,907 | 31,098 | ||||||||||||
ELLINGTON FINANCIAL LLC CONSOLIDATED STATEMENT OF ASSETS, LIABILITIES, AND EQUITY (UNAUDITED) |
||||||||||||||
As of | ||||||||||||||
(In thousands, except share amounts) |
September 30, |
June 30, 2018 |
December 31, 2017(1) |
|||||||||||
ASSETS | ||||||||||||||
Cash and cash equivalents | $ | 53,598 | $ | 22,071 | $ | 47,233 | ||||||||
Restricted cash | 425 | 425 | 425 | |||||||||||
Investments, financial derivatives, and repurchase agreements: | ||||||||||||||
Investments, at fair value (Cost–$2,694,223, $2,631,409, and $2,071,754) | 2,670,069 | 2,625,471 | 2,071,707 | |||||||||||
Financial derivatives–assets, at fair value (Net cost–$20,895, $24,510, and $31,474) | 31,338 | 30,669 | 28,165 | |||||||||||
Repurchase agreements (Cost–$160,468, $214,346, and $155,109) | 160,422 | 214,411 | 155,949 | |||||||||||
Total Investments, financial derivatives, and repurchase agreements | 2,861,829 | 2,870,551 | 2,255,821 | |||||||||||
Due from brokers | 83,915 | 84,196 | 140,404 | |||||||||||
Receivable for securities sold and financial derivatives | 670,952 | 637,965 | 476,000 | |||||||||||
Interest and principal receivable | 38,635 | 32,469 | 29,688 | |||||||||||
Other assets | 5,207 | 24,399 | 43,770 | |||||||||||
Total assets | $ | 3,714,561 | $ | 3,672,076 | $ | 2,993,341 | ||||||||
LIABILITIES | ||||||||||||||
Investments and financial derivatives: | ||||||||||||||
Investments sold short, at fair value (Proceeds–$697,686, $880,825, and $640,202) | $ | 695,349 | $ | 882,146 | $ | 642,240 | ||||||||
Financial derivatives–liabilities, at fair value (Net proceeds–$16,294, $18,294, and $27,463) | 27,226 | 25,675 | 36,273 | |||||||||||
Total investments and financial derivatives | 722,575 | 907,821 | 678,513 | |||||||||||
Reverse repurchase agreements | 1,636,039 | 1,421,506 | 1,209,315 | |||||||||||
Due to brokers | 4,551 | 3,250 | 1,721 | |||||||||||
Payable for securities purchased and financial derivatives | 430,808 | 431,024 | 202,703 | |||||||||||
Other secured borrowings (Proceeds–$114,190, $95,630, and $57,909) | 114,190 | 95,630 | 57,909 | |||||||||||
Other secured borrowings, at fair value (Proceeds–$90,409 $102,298, and $125,105) | 89,569 | 101,100 | 125,105 | |||||||||||
Senior notes, net | 84,968 | 84,902 | 84,771 | |||||||||||
Accounts payable and accrued expenses | 5,337 | 4,105 | 3,885 | |||||||||||
Base management fee payable to affiliate | 1,830 | 2,021 | 2,113 | |||||||||||
Incentive fee payable to affiliate | 424 | 291 | — | |||||||||||
Interest and dividends payable | 6,451 | 6,791 | 5,904 | |||||||||||
Other liabilities | 1,141 | 360 | 441 | |||||||||||
Total liabilities | 3,097,883 | 3,058,801 | 2,372,380 | |||||||||||
EQUITY | 616,678 | 613,275 | 620,961 | |||||||||||
TOTAL LIABILITIES AND EQUITY | $ | 3,714,561 | $ | 3,672,076 | $ | 2,993,341 | ||||||||
ANALYSIS OF EQUITY: | ||||||||||||||
Common shares, no par value, 100,000,000 shares authorized; | ||||||||||||||
(30,155,055, 30,149,880, and 31,335,938, shares issued and outstanding) |
$ | 583,179 | $ | 589,000 | $ | 589,722 | ||||||||
Additional paid-in capital–LTIP units | 10,618 | 10,567 | 10,377 | |||||||||||
Total Shareholders' Equity | 593,797 | 599,567 | 600,099 | |||||||||||
Non-controlling interests | 22,881 | 13,708 | 20,862 | |||||||||||
Total Equity | $ | 616,678 | $ | 613,275 | $ | 620,961 | ||||||||
PER SHARE INFORMATION: | ||||||||||||||
Common shares, no par value | $ | 19.69 | $ | 19.89 | $ | 19.15 | ||||||||
DILUTED PER SHARE INFORMATION: | ||||||||||||||
Common shares and convertible units, no par value (2) | $ | 19.37 | $ | 19.57 | $ | 18.85 |
(1) |
Derived from audited financial statements as of December 31, 2017. |
|
(2) |
Based on total equity excluding non-controlling interests not represented by instruments convertible into common shares. |
|
Reconciliation of Adjusted Net Investment Income to Net Investment Income
The table below reconciles Adjusted net investment income for the
three-month period ended
The Company believes that Adjusted net investment income provides information useful to investors because it is one of the metrics that it uses to assess its performance and to evaluate the effective net yield provided by the Company's portfolio. However, because Adjusted net investment income is an incomplete measure of the Company's financial results and differs from Net investment income computed in accordance with U.S. GAAP, it should be considered as supplementary to, and not as a substitute for, Net investment income computed in accordance with U.S. GAAP.
(In thousands, except per share amounts) |
Three-Month
Period Ended September 30, 2018 |
||||
Net investment income | $ | 11,678 | |||
Include: | |||||
Net realized and change in net unrealized gains (losses) from certain equity investments in partnerships(1) | 104 | ||||
Net periodic (payments) receipts on interest rate swaps(2) | 79 | ||||
Exclude: | |||||
Incentive fee to affiliate | (424 | ) | |||
Catch-up Premium Amortization Adjustment | (170 | ) | |||
Adjusted net investment income | $ | 12,455 | |||
Weighted average shares and convertible units outstanding | 30,859 | ||||
Net investment income per share | $ | 0.38 | |||
Adjusted net investment income per share | $ | 0.40 |
(1) |
Includes only those components that would be included in net investment income at the underlying partnership. |
|
(2) |
Net periodic (payments) receipts on interest swaps related to our interest rate hedging portfolio. |
View source version on businesswire.com: https://www.businesswire.com/news/home/20181107005928/en/
Source:
Investors:
Ellington Financial LLC
Investor Relations,
203-409-3575
info@ellingtonfinancial.com
or
Media:
Gasthalter
& Co., for Ellington Financial
Amanda Klein or Kevin
FitzGerald, 212-257-4170
Ellington@gasthalter.com