Ladder Capital (LADR) Q2 2024 earnings summary

Executive summary

• Distributable earnings for Q2 2024 were $40.4 million, or $0.31 per share, with a 10.2% return on equity and strong liquidity, supported by a large cash position and low leverage.

• Net income attributable to Class A shareholders was $32.1 million, up from $16.4 million in Q1 2024.

• Successfully priced a $500 million seven-year unsecured corporate bond, leading to positive rating actions from all three agencies.

• Liquidity as of June 30, 2024, was $1.2 billion in cash and equivalents, with total liquidity exceeding $1.5 billion including a fully undrawn $324 million revolver.

• Undepreciated book value per share was $13.71, net of CECL allowance.

Financial highlights

• Q2 distributable earnings: $40.4 million ($0.31/share); return on equity: 10.2%.

• Net income for Q2 2024 was $32.1 million; net interest income was $34.3 million.

• Loan portfolio at quarter end: $2.5 billion, weighted average yield 9.4%.

• Dividend of $0.23/share declared for Q2 2024.

• Net gain of $1.6 million from sale of $29 million fixed-rate loans into CMBS.

Outlook and guidance

• Management emphasizes a conservative capital structure, high liquidity, and modest leverage.

• Anticipates further expansion of the loan portfolio and increased origination momentum in Q3 and Q4.

• Optimism for future earnings growth as significant cash is deployed into higher-yielding investments.

• Well-positioned to benefit from potential Fed rate cuts and improving CRE market sentiment.

• Ongoing headwinds expected from commercial real estate market volatility and macroeconomic uncertainty.