BRANFORD, Conn., March 27, 2025 (GLOBE NEWSWIRE) -- Sachem Capital Corp. (NYSE American: SACH), a real estate lender specializing in originating, underwriting, funding, servicing, and managing a portfolio of loans secured by first mortgages on real property, today announced its financial results for the year ended December 31, 2024.
John Villano, CPA, Sachem Capital's Chief Executive Officer commented, "We remain focused on effectively managing our loan portfolio and protecting our capital as we continue our efforts to navigate challenging financial and real estate markets. These efforts include managing our debt load and the associated carrying costs and selling non-performing loans, which should reduce the allowances for credit losses that have been a drag on earnings. We continue to evaluate attractive opportunities to invest capital while maintaining a disciplined capital allocation approach. With our experienced team, we remain confident that growth will return as we leverage strong industry relationships and work to increase shareholder value."
Results of operations for year ended December 31, 2024
Total revenue was $57.5 million compared to $64.7 million in 2023. The decline in revenue was primarily due to fewer originations and a reduction in the number of loans held for investment. Also, interest income, fee income from loans and other investment income was lower compared to 2023. Interest income in 2024 was $43.2 million compared to $49.3 million for 2023. On the other hand, income from partnership investments increased approximately 48.8%, year-over-year.
Total operating costs and expenses for 2024 were $75.3 million compared to $49.7 million in 2023. The change was primarily due to an increase of $21.3 million in provision for credit losses and a $1.9 million increase in general and administrative expenses. These increases were offset by lower interest and amortization expense of $1.4 million.
Net loss attributable to common shareholders for 2024 was $43.9 million, or $0.93 per share compared to net income attributable to common shareholders of $12.1 million, or $0.27 per share for 2023.
Balance Sheet
Total assets as of the year ended December 31, 2024 were $492.0 million compared to $620.9 million as of December 31, 2023. The change was primarily due to net reduction in loans held for investment by $130.5 million. Total liabilities as of December 31, 2024 were $310.3 million compared to $390.8 million as of December 31, 2023, with the primary decreases coming from the repayment of unsubordinated unsecured five year notes that matured in 2024, in the aggregate principal amount of $58.3 million, and the paydown of lines of credit balances in the aggregate amount of $21.8 million.
Total indebtedness at year-end was $301.2 million. This includes: $226.5 million of notes payable (net of $3.7 million of deferred financing costs) and $74.7 million aggregate outstanding principal amount of the amounts due under various credit facilities and the mortgage loan on the Company's office building.
Total shareholders' equity at year-end 2024 was $181.7 million compared to $230.1 million at year-end 2023. The change was primarily due to an operational total net loss for the year of $39.6 million and preferred and common stock dividends declared and paid of $15.7 million.
Dividends
Over the course of 2024, the Company paid an aggregate of $4.3 million in dividends to holders of its Series A Cumulative Redeemable Preferred Stock and $11.4 million to the holders of its common shares.
On February 24, 2025, the Company declared a dividend of $0.484375 per share on the Series A Preferred Stock, payable on March 31, 2025 to Series A Preferred Stock shareholders of record on March 15, 2025.
On March 6, 2025, the Company declared a quarterly dividend of $0.05 per common share payable to common shareholders of record on March 17, 2025. The dividend is expected to be paid March 31, 2025.
The Company currently operates and qualifies as a Real Estate Investment Trust (REIT) for federal income taxes and intends to continue to qualify and operate as a REIT. Under federal income tax rules, a REIT is required to distribute a minimum of 90% of taxable income each year to its shareholders, and the Company intends to comply with this requirement for the current year.
Investor Conference Webcast and Call
The Company is hosting a webcast and conference call Thursday, March 27, 2025 at 8:00 a.m. Eastern Time, to discuss in greater detail its financial results for the full year ended December 31, 2024. A webcast of the call may be accessed on the Company's website at https://sachemcapitalcorp.com/investor-relations/events-and-presentations/default.aspx.
Interested parties can access the conference call via telephone by dialing toll free 877-704-4453 for U.S. callers or +1-201-389-0920 for international callers.
Replay
The webcast will also be archived on the Company's website and a telephone replay of the call will be available through Thursday, April 10, 2025, and can be accessed by dialing 1-844-512-2921 for U.S. callers or +1 412-317-6671 for international callers and by entering replay passcode: 13750432.
About Sachem Capital Corp
Sachem Capital Corp. is a mortgage REIT that specializes in originating, underwriting, funding, servicing, and managing a portfolio of loans secured by first mortgages on real property. It offers short-term (i.e., three years or less) secured, nonbanking loans to real estate investors to fund their acquisition, renovation, development, rehabilitation, or improvement of properties. The Company's primary underwriting criteria is a conservative loan to value ratio. The properties securing the loans are generally classified as residential or commercial real estate and, typically, are held for resale or investment. Each loan is secured by a first mortgage lien on real estate and is personally guaranteed by the principal(s) of the borrower. The Company also makes opportunistic real estate purchases apart from its lending activities.
Forward Looking Statements
This press release may contain forward-looking statements. All statements other than statements of historical facts contained in this press release, including statements regarding our future results of operations and financial position, strategy and plans, and our expectations for future operations, are forward-looking statements. Such forward-looking statements are subject to several risks, uncertainties and assumptions as described in the Annual Report on Form 10-K for 2024 to be filed with the U.S. Securities and Exchange Commission (the "SEC") on or before March 31, 2025. Because of these risks, uncertainties and assumptions, any forward-looking events and circumstances discussed in this press release may not occur. You should not rely upon forward-looking statements as predictions of future events. Neither the Company nor any other person assumes responsibility for the accuracy and completeness of any of these forward-looking statements. The Company disclaims any duty to update any of these forward-looking statements. All forward-looking statements attributable to the Company are expressly qualified in their entirety by these cautionary statements as well as others made in this press release. You should evaluate all forward-looking statements made by the Company in the context of these risks and uncertainties.
Investor & Media Contact:
Email: investors@sachemcapitalcorp.com
| SACHEM CAPITAL CORP. CONSOLIDATED BALANCE SHEETS (in thousands, except share data) | ||||||||
| Years Ended | ||||||||
| December 31, | ||||||||
| 2024 | 2023 | |||||||
| Assets | (unaudited) | (audited) | ||||||
| Cash and cash equivalents | $ | 18,066 | $ | 12,598 | ||||
| Investment securities (at fair value) | 1,517 | 37,776 | ||||||
| Loans held for investment (net of deferred loan fees of $1,950 and $4,647) | 375,041 | 494,588 | ||||||
| Allowance for credit losses | (18,470 | ) | (7,523 | ) | ||||
| Loans held for investments, net of allowances for credit losses | 356,571 | 487,065 | ||||||
| Loans held for sale (net, of valuation allowance of $4,880 and $0) | 10,970 | - | ||||||
| Interest and fees receivable, net | 3,768 | 8,475 | ||||||
| Due from borrowers, net | 5,150 | 5,597 | ||||||
| Real estate owned, net | 18,574 | 3,462 | ||||||
| Investments in limited liability companies | 53,942 | 43,036 | ||||||
| Investments in rental real estate, net | 14,032 | 10,554 | ||||||
| Property and equipment, net | 3,222 | 3,373 | ||||||
| Other assets | 6,164 | 8,956 | ||||||
| Total assets | $ | 491,976 | $ | 620,892 | ||||
| Liabilities and Shareholders' Equity | ||||||||
| Liabilities: | ||||||||
| Notes payable (net of deferred financing costs of $3,713 and $6,048) | $ | 226,526 | $ | 282,353 | ||||
| Repurchase agreements | 33,708 | 26,461 | ||||||
| Mortgage payable | 1,002 | 1,081 | ||||||
| Lines of credit | 40,000 | 61,792 | ||||||
| Accrued dividends payable | - | 5,144 | ||||||
| Accounts payable and accrued liabilities | 4,377 | 2,322 | ||||||
| Advances from borrowers | 4,047 | 10,998 | ||||||
| Below market lease intangible | 665 | 665 | ||||||
| Total liabilities | 310,325 | 390,816 | ||||||
| Commitments and Contingencies | ||||||||
| Shareholders' equity: | ||||||||
| Preferred shares - $.001 par value; 5,000,000 shares authorized; 2,903,000 shares designated as Series A Preferred Stock; 2,306,748 and 2,029,923 shares of Series A Preferred Stock issued and outstanding at December 31, 2024 and December 31, 2023, respectively | 2 | 2 | ||||||
| Common stock - $.001 par value; 200,000,000 shares authorized; 46,965,306 and 46,765,483 issued and outstanding at December 31, 2024 and December 31, 2023, respectively | 47 | 47 | ||||||
| Additional paid-in capital | 256,956 | 249,826 | ||||||
| Accumulated other comprehensive income | - | 316 | ||||||
| Cumulative net earnings | 35,518 | 75,089 | ||||||
| Cumulative dividends paid | (110,872 | ) | (95,204 | ) | ||||
| Total shareholders' equity | 181,651 | 230,076 | ||||||
| Total liabilities and shareholders' equity | $ | 491,976 | $ | 620,892 | ||||
| SACHEM CAPITAL CORP. CONSOLIDATED STATEMENTS OF OPERATIONS (in thousands, except share and per share data) | ||||||||
| Years Ended | ||||||||
| December 31, | ||||||||
| 2024 | 2023 | |||||||
| Revenues | (unaudited) | (audited) | ||||||
| Interest income from loans | $ | 43,154 | $ | 49,265 | ||||
| Fee income from loans | 8,594 | 10,699 | ||||||
| Income from limited liability company investments | 5,239 | 3,522 | ||||||
| Other investment income | 391 | 1,209 | ||||||
| Other income | 122 | 54 | ||||||
| Total revenues | 57,500 | 64,749 | ||||||
| Operating expenses | ||||||||
| Interest and amortization of deferred financing costs | 27,798 | 29,190 | ||||||
| Compensation and employee benefits | 6,824 | 6,932 | ||||||
| General and administrative expenses | 6,841 | 4,955 | ||||||
| Provision for credit losses related to available-for-sale debt securities | - | 809 | ||||||
| Provision for credit losses related to loans held for investment | 26,928 | 5,588 | ||||||
| Change in valuation allowance, loans held for sale | 4,880 | - | ||||||
| Impairment loss on real estate owned | 492 | 794 | ||||||
| (Gain) loss on sale of real estate and property and equipment, net | (439 | ) | 88 | |||||
| Other expenses | 1,952 | 1,354 | ||||||
| Total operating expenses | 75,276 | 49,710 | ||||||
| Operating (loss) income before other (loss) income | (17,776 | ) | 15,039 | |||||
| Other (loss) income | ||||||||
| Gain on equity securities | 178 | 860 | ||||||
| Loss on sale of loans | (21,973 | ) | - | |||||
| Total other (loss) income, net | (21,795 | ) | 860 | |||||
| Net (loss) income | (39,571 | ) | 15,899 | |||||
| Preferred stock dividend | (4,304 | ) | (3,795 | ) | ||||
| Net (loss) income attributable to common shareholders | $ | (43,875 | ) | $ | 12,104 | |||
| Basic (loss) earnings per Common Share | $ | (0.93 | ) | $ | 0.27 | |||
| Diluted (loss) earnings per Common Share | $ | (0.93 | ) | $ | 0.27 | |||
| Basic weighted average Common Shares outstanding | 47,413,012 | 44,244,988 | ||||||
| Diluted weighted average Common Shares outstanding | 47,413,012 | 44,244,988 | ||||||
| SACHEM CAPITAL CORP. CONSOLIDATED STATEMENTS OF CASH FLOWS (in thousands) | ||||||||
| Years Ended | ||||||||
| December 31, | ||||||||
| 2024 | 2023 | |||||||
| CASH FLOWS FROM OPERATING ACTIVITIES | (unaudited) | (audited) | ||||||
| Net (loss) income | $ | (39,571 | ) | $ | 15,899 | |||
| Adjustments to reconcile net (loss) income to net cash provided by operating activities: | ||||||||
| Amortization of deferred financing costs | 2,456 | 2,415 | ||||||
| Depreciation expense | 372 | 266 | ||||||
| Write-off of other assets - pre-offering costs | - | 477 | ||||||
| Stock-based compensation | 863 | 823 | ||||||
| Provision for credit losses related to available-for-sale debt securities | - | 809 | ||||||
| Provision for credit losses related to loans held for investment | 26,928 | 5,588 | ||||||
| Change in valuation allowance, loans held for sale | 4,880 | - | ||||||
| Loss on sale of Loans | 21,973 | - | ||||||
| Impairment loss on real estate owned | 492 | 794 | ||||||
| (Gain) loss on sale of real estate and property and equipment, net | (439 | ) | 88 | |||||
| (Gain) on equity securities | (178 | ) | (860 | ) | ||||
| Changes in operating assets and liabilities: | ||||||||
| Interest and fees receivable, net | 1,574 | (2,285 | ) | |||||
| Other assets | 2,656 | (3,596 | ) | |||||
| Due from borrowers, net | (689 | ) | (334 | ) | ||||
| Accounts payable and accrued liabilities | 1,132 | 374 | ||||||
| Deferred loan fees revenue | (2,697 | ) | 287 | |||||
| Advances from borrowers | (6,951 | ) | 1,106 | |||||
| Total adjustments and operating changes | 52,372 | 5,952 | ||||||
| NET CASH PROVIDED BY OPERATING ACTIVITIES | 12,801 | 21,851 | ||||||
| CASH FLOWS FROM INVESTING ACTIVITIES | ||||||||
| Purchase of investment securities | (7,767 | ) | (30,415 | ) | ||||
| Proceeds from the sale of investment securities | 43,964 | 18,120 | ||||||
| Purchase of interests in limited liability companies | (18,271 | ) | (13,896 | ) | ||||
| Proceeds from limited liability companies returns of capital | 7,310 | 1,661 | ||||||
| Proceeds from sale of loans, net | 36,122 | - | ||||||
| Proceeds from sale of real estate owned | 2,613 | 450 | ||||||
| Acquisitions of and improvements to real estate owned | (510 | ) | (229 | ) | ||||
| Proceeds from sale of property and equipment | - | 1,299 | ||||||
| Purchase of property and equipment | (203 | ) | (784 | ) | ||||
| Improvements in investment in rental real estate | (3,496 | ) | (10,845 | ) | ||||
| Principal disbursements for loans | (134,298 | ) | (204,885 | ) | ||||
| Principal collections on loans | 154,654 | 167,036 | ||||||
| NET CASH PROVIDED BY (USED IN) INVESTING ACTIVITIES | 80,118 | (72,488 | ) | |||||
| CASH FLOWS FROM FINANCING ACTIVITIES | ||||||||
| Proceeds from lines of credit | 27,959 | 58,204 | ||||||
| Repayments on lines of credit | (49,751 | ) | - | |||||
| Proceeds from repurchase agreements | 19,055 | 14,028 | ||||||
| Repayments of repurchase agreements | (11,808 | ) | (30,100 | ) | ||||
| (Repayment of) proceeds from mortgage payable | (79 | ) | 331 | |||||
| Dividends paid on Common Shares | (16,507 | ) | (21,933 | ) | ||||
| Dividends paid on Series A Preferred Stock | (4,304 | ) | (3,795 | ) | ||||
| Proceeds from issuance of common shares, net of expenses | 2,050 | 20,450 | ||||||
| Repurchase of Common Shares | (1,489 | ) | (226 | ) | ||||
| Proceeds from issuance of Series A Preferred Stock, net of expenses | 5,706 | 2,563 | ||||||
| Repayment of notes payable | (58,283 | ) | - | |||||
| NET CASH (USED IN) PROVIDED BY FINANCING ACTIVITIES | (87,451 | ) | 39,522 | |||||
| NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS | 5,468 | (11,115 | ) | |||||
| CASH AND CASH EQUIVALENTS - BEGINNING OF PERIOD | 12,598 | 23,713 | ||||||
| CASH AND CASH EQUIVALENTS - END OF PERIOD | $ | 18,066 | $ | 12,598 | ||||
