Atrium Mortgage Investment Corporation Announces Strong Third Quarter Earnings per Share and an Increase in Monthly Dividend
Toronto, Ontario--(Newsfile Corp. - November 13, 2024) - Atrium Mortgage Investment Corporation (TSX: AI) (TSX: AI.DB.D) (TSX: AI.DB.E) (TSX: AI.DB.F) (TSX: AI.DB.G) today released its financial results for the three and nine months period ended September 30, 2024.
Highlights
Quarterly basic and diluted earnings per share of $0.26, up from $0.25 basic and diluted in the prior year
Quarterly net income of $11.6 million, up from $11.0 million in the prior year
Increase annual dividend rate by 3.3% from $0.90 to $0.93 per common share beginning in December 2024
Record mortgage portfolio of $926.3 million
High quality mortgage portfolio
97.3% of portfolio in first mortgages
90.3% of portfolio is less than 75% loan-to-value
average loan-to-value is 64.1%
"Despite the ongoing challenges in the real estate market, Atrium continued to produce very strong results for shareholders. Earnings per share for the quarter were $0.26 and our year-to-date earnings per share of $0.79 represents our second best nine-month result reported in our history as a public company. Our conservative 85% dividend payout ratio bodes well for the prospect of another sizable special dividend at year-end. We have continued to maintain our disciplined underwriting with 97.3% of the portfolio composed of first mortgages and 90.3% with a loan-to-value of less than 75%. In Q3 and the early part of Q4, we made substantial progress on the repayment of several Stage 2 and 3 loans. Barring any unforeseen changes, we expect that Stage 2 and 3 loans, as a percentage of the total portfolio, to drop sharply when we release our year-end results. Based on improvements in our borrowing base and stabilizing market conditions, I am pleased to announce an increase in our monthly dividend from an annual rate of $0.90 to $0.93 per share. Shortly after the end of Q3, Atrium also completed a highly successful common share offering for total gross proceeds of $28.8 million to further support the growth and liquidity of our business. We were gratified by the overwhelming investor demand for this offering," said Rob Goodall, CEO of Atrium.
Conference call
Interested parties are invited to participate in a conference call with management on Thursday, November 14, 2024 at 4:00 p.m. ET to discuss the results. To participate or listen to the conference call live, please call 1-833-491-0507 (call topic: Third quarter results). For a replay of the conference call (available until November 27, 2024) please call 1-833-607-0619, passcode 7754991#.
Results of operations
For the three months ended September 30, 2024, Atrium reported assets of $903.6 million, up from $877.9 million at the end of 2023. Revenues were $24.5 million, a decrease of 3.5% from the third quarter of the prior year. Net income for the third quarter of 2024 was $11.6 million, an increase of 5.6% from the comparative period. Atrium's allowance for mortgage losses at September 30, 2024 totaled $29.9 million, or 3.23% of the gross mortgage portfolio, which is up from $22.6 million or 2.53% of the mortgage portfolio at December 31, 2023.
For the nine months ended September 30, 2024, revenues were $74.6 million, an increase of 2.7% from the nine months ended September 30, 2023. Net income for the nine months ended September 30, 2024 was $35.2 million, a decrease of 11.2% from the prior year period.
Basic and diluted earnings per common share were $0.26 for the three months ended September 30, 2024, compared with $0.25 basic and diluted earnings per common share in the comparable period. Basic and diluted earnings per common share were $0.79 for the nine months ended September 30, 2024, compared with $0.91 and $0.88 basic and diluted earnings per common share respectively for the nine months ended September 30, 2023.
Mortgages receivable as at September 30, 2024 was $902.3 million, up from $876.7 million as at December 31, 2023. During the nine months ended September 30, 2024, $232.6 million of mortgage principal was advanced and $202.0 million was repaid. The weighted average interest rate on the mortgage portfolio at September 30, 2024 was 10.52%, compared to 11.42% at December 31, 2023.
Financial summary
Interim Consolidated Statements of Income and Comprehensive Income
(Unaudited, 000s, except per share amounts)
| Three months ended | Nine months ended | |||||||||||
| | September 30, | September 30, | | |||||||||
| 2024 | 2023 | 2024 | 2023 | | ||||||||
| Revenue | $ | 24,514 | $ | 24,412 | $ | 74,637 | $ | 72,667 | ||||
| Mortgage servicing and management fees | (2,168 | ) | (2,153 | ) | (6,414 | ) | (6,259 | ) | ||||
| Other expenses | (414 | ) | (241 | ) | (1,064 | ) | (1,017 | ) | ||||
| Recovery of prior mortgage loss | − | 220 | 183 | 377 | ||||||||
| Provision for mortgage losses | (3,488 | ) | (5,442 | ) | (11,707 | ) | (7,084 | ) | ||||
| Income before financing costs | 18,444 | 17,796 | 55,635 | 58,684 | ||||||||
| Financing costs | (6,839 | ) | (6,804 | ) | (20,460 | ) | (19,051 | ) | ||||
| Net income and comprehensive income | $ | 11,605 | $ | 10,992 | $ | 35,175 | $ | 39,633 | | |||
| Basic earnings per share | $ | 0.26 | $ | 0.25 | $ | 0.79 | $ | 0.91 | ||||
| Diluted earnings per share | $ | 0.26 | $ | 0.25 | $ | 0.79 | $ | 0.88 | ||||
| Dividends declared | $ | 10,004 | $ | 9,854 | $ | 29,906 | $ | 29,461 | ||||
| Mortgages receivable, end of period | $ | 902,318 | $ | 863,760 | $ | 902,318 | $ | 863,760 | ||||
| Total assets, end of period | $ | 903,562 | $ | 864,894 | $ | 903,562 | $ | 864,894 | ||||
| Shareholders' equity, end of period | $ | 493,610 | $ | 491,776 | $ | 463,610 | $ | 491,776 | ||||
| Book value per share, end of period | $ | 11.09 | $ | 11.21 | $ | 11.09 | $ | 11.21 | ||||
Analysis of mortgage portfolio
| As at September 30, 2024 | As at December 31, 2023 | |||||||||||||||||
| Outstanding | % of | Outstanding | % of | |||||||||||||||
| Property Type | Number | amount | Portfolio | Number | amount | Portfolio | ||||||||||||
| (outstanding amounts in 000s) | ||||||||||||||||||
| High-rise residential | 18 | $ | 302,307 | 32.6% | 22 | $ | 323,340 | 36.2% | ||||||||||
| Mid-rise residential | 22 | 163,075 | 17.6% | 25 | 208,289 | 23.3% | ||||||||||||
| Low-rise residential | 14 | 166,082 | 17.9% | 14 | 153,561 | 17.2% | ||||||||||||
| House and apartment | 206 | 145,057 | 15.7% | 153 | 117,943 | 13.2% | ||||||||||||
| Condominium corporation | 7 | 1,339 | 0.1% | 10 | 1,786 | 0.2% | ||||||||||||
| Residential portfolio | 267 | 777,860 | 83.9% | 224 | 804,919 | 90.1% | ||||||||||||
| Commercial | 20 | 148,437 | 16.1% | 19 | 88,640 | 9.9% | ||||||||||||
| Mortgage portfolio | 287 | $ | 926,297 | 100.0% | 243 | $ | 893,559 | 100.0% | ||||||||||
| As at September 30, 2024 | |||||||||||||||
| Weighted | Weighted | ||||||||||||||
| average | average | ||||||||||||||
| Location of underlying property | Number of mortgages | Outstanding amount | Percentage outstanding | loan-to- value | interest rate | ||||||||||
| (outstanding amounts in 000s) | |||||||||||||||
| Greater Toronto Area | 201 | $ | 733,262 | 79.2% | 61.3% | 10.62% | |||||||||
| Non-GTA Ontario | 66 | 43,613 | 4.7% | 66.2% | 9.51% | ||||||||||
| British Columbia | 20 | 149,422 | 16.1% | 76.6% | 10.34% | ||||||||||
| 287 | $ | 926,297 | 100.0% | 64.1% | 10.52% | ||||||||||
| As at December 31, 2023 | |||||||||||||||
| Weighted | Weighted | ||||||||||||||
| average | average | ||||||||||||||
| Location of underlying property | Number of mortgages | Outstanding amount | Percentage outstanding | loan-to- value | interest rate | ||||||||||
| (outstanding amounts in 000s) | |||||||||||||||
| Greater Toronto Area | 166 | $ | 653,401 | 73.1% | 61.4% | 11.63% | |||||||||
| Non-GTA Ontario | 52 | 40,753 | 4.6% | 64.6% | 9.81% | ||||||||||
| British Columbia | 24 | 191,955 | 21.5% | 60.6% | 10.95% | ||||||||||
| Alberta | 1 | 7,450 | 0.8% | 71.0% | 14.00% | ||||||||||
| 243 | $ | 893,559 | 100.0% | 61.4% | 11.42% | ||||||||||
For further information on the financial results, and further analysis of the company's mortgage portfolio, please refer to Atrium's interim consolidated financial statements and its management's discussion and analysis for the three and nine month period ended September 30, 2024, available on SEDAR+ at www.sedarplus.ca, and on the company's website at www.atriummic.com.
About Atrium
Canada's Premier Non-Bank Lender™
Atrium is a non-bank provider of residential and commercial mortgages that lends in major urban centres in Canada where the stability and liquidity of real estate are high. Atrium's objectives are to provide its shareholders with stable and secure dividends and preserve shareholders' equity by lending within conservative risk parameters. Atrium is a Mortgage Investment Corporation (MIC) as defined in the Canada Income Tax Act, so is not taxed on income provided that its taxable income is paid to its shareholders in the form of dividends within 90 days after December 31 each year. Such dividends are generally treated by shareholders as interest income, so that each shareholder is in the same position as if the mortgage investments made by the company had been made directly by the shareholder. For further information about Atrium, please refer to regulatory filings available at www.sedarplus.ca or investor information on Atrium's website at www.atriummic.com.
For additional information, please contact
Robert G. Goodall
Chief Executive Officer
John Ahmad
Chief Financial Officer
(416) 867-1053
info@atriummic.com
www.atriummic.com
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