Rithm Capital Corp. (NYSE: RITM; “Rithm Capital” or the “Company”) today reported the following information for the first quarter ended March 31, 2023:
First Quarter 2023 Financial Highlights:
- GAAP net income of $68.9 million, or $0.14 per diluted common share (1)
- Earnings available for distribution of $171.1 million, or $0.35 per diluted common share (1)(2)
- Common dividend of $120.8 million, or $0.25 per common share
- Book value per common share of $11.67 (1)
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Q1 2023 |
Q4 2022 |
|---|---|---|
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Summary Operating Results: |
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|
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GAAP Net Income per Diluted Common Share (1) |
$0.14 |
$0.17 |
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GAAP Net Income |
$68.9 million |
$81.8 million |
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Non-GAAP Results: |
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|
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Earnings Available for Distribution per Diluted Common Share (1)(2) |
$0.35 |
$0.33 |
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Earnings Available for Distribution (2) |
$171.1 million |
$156.9 million |
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Common Dividend: |
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|
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Common Dividend per Share |
$0.25 |
$0.25 |
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Common Dividend |
$120.8 million |
$118.6 million |
“Rithm delivered great performance in the first quarter of 2023,” said Michael Nierenberg, Chairman, Chief Executive Officer and President of Rithm Capital. “In contrast to the volatile macro environment and the stress in the regional banking sector, we produced consistent results, generating $0.35 in earnings available for distribution per share and posting book value of $11.67 per share.”
“Over a year into the Fed’s aggressive tightening cycle, we have effectively navigated the market and positioned our Company for success. Our focus on credit and risk management, and our opportunistic approach to capital management has served the Company and its shareholders extremely well. Our expansion into the private capital business and our emphasis on quality performance in our existing portfolio will drive our Company through its next phase of growth. With plenty of uncertainty still to play out in the financial services space, Rithm is well-positioned to continue deploying capital into attractive opportunities. We look forward to seeing Rithm’s success as we move through 2023 and beyond.”
First Quarter 2023 Company Highlights:
- Origination & Servicing (Mortgage Company)
- Combined segment pre-tax income of $164.0 million (3)
- Quarterly origination funded production volume of $7.0 billion
- Estimated Q2’23 funded origination volume of approximately $7 to $9 billion
- Total Rithm MSR Portfolio Summary
- MSR portfolio totaled $603 billion in unpaid principal balance (“UPB”) at March 31, 2023 compared to $609 billion UPB at December 31, 2022 (4)
- Portfolio average CPR of approximately 5%
- Servicer advance balances of $3.0 billion as of March 31, 2023, relatively flat compared to balances as of December 31, 2022
- MSR portfolio totaled $603 billion in unpaid principal balance (“UPB”) at March 31, 2023 compared to $609 billion UPB at December 31, 2022 (4)
- Mortgage Loans Receivable
- Quarterly origination funded production volume of $376 million through Genesis Capital LLC
- Per common share calculations for both GAAP Net Income and Earnings Available for Distribution are based on 482,846,911 and 480,852,723 weighted average diluted shares for the quarters ended March 31, 2023 and December 31, 2022, respectively. Per share calculations of Book Value are based on 483,017,747 common shares outstanding as of March 31, 2023.
- Earnings Available for Distribution is a non-GAAP financial measure. For a reconciliation of Earnings Available for Distribution to GAAP Net Income, as well as an explanation of this measure, please refer to Non-GAAP Financial Measures and Reconciliation to GAAP Net Income below.
- Includes noncontrolling interests.
- Includes excess and full MSRs.
Additional Information
For additional information that management believes to be useful for investors, please refer to the latest presentation posted on the Investors section of the Company’s website, www.rithmcap.com. For consolidated investment portfolio information, please refer to the Company’s most recent Quarterly Report on Form 10-Q or Annual Report on Form 10-K, which are available on the Company’s website, www.rithmcap.com. Information on, or accessible through, our website is not a part of, and is not incorporated into, this press release.
Earnings Conference Call
Rithm Capital’s management will host a conference call on Thursday, May 4, 2023 at 8:00 A.M. Eastern Time. A copy of the earnings release will be posted to the Investors section of Rithm Capital’s website, www.rithmcap.com.
All interested parties are welcome to participate on the live call. The conference call may be accessed by dialing 1-833-974-2382 (from within the U.S.) or 1-412-317-5787 (from outside of the U.S.) ten minutes prior to the scheduled start of the call; please reference “Rithm Capital First Quarter 2023 Earnings Call.” In addition, participants are encouraged to pre-register for the conference call at https://dpregister.com/sreg/10178198/f937038cf2.
A simultaneous webcast of the conference call will be available to the public on a listen-only basis at www.rithmcap.com. Please allow extra time prior to the call to visit the website and download any necessary software required to listen to the internet broadcast.
A telephonic replay of the conference call will also be available two hours following the call’s completion through 11:59 P.M. Eastern Time on Thursday, May 11, 2023 by dialing 1-877-344-7529 (from within the U.S.) or 1-412-317-0088 (from outside of the U.S.); please reference access code “6803150.”
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March 31, 2023 |
December 31, 2022 |
|---|---|---|
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Revenues |
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Servicing fee revenue, net and interest income from MSR financing receivables |
$469,839 |
$452,923 |
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Change in fair value of MSRs and MSR financing receivables (includes realization of cash flows of $(105,691), and $(108,914), respectively) |
(142,304) |
(162,028) |
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Servicing revenue, net |
327,535 |
290,895 |
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Interest income |
346,614 |
365,541 |
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Gain on originated residential mortgage loans, held-for-sale, net |
109,268 |
105,966 |
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|
783,417 |
762,402 |
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Expenses |
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Interest expense and warehouse line fees |
309,068 |
283,250 |
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General and administrative |
167,155 |
189,295 |
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Compensation and benefits |
188,880 |
208,185 |
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|
665,103 |
680,730 |
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Other income (loss) |
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Realized and unrealized gains (losses) on investments, net |
(75,649) |
9,764 |
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Other income (loss), net |
30,478 |
(3,650) |
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|
(45,171) |
6,114 |
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Income before income taxes |
73,143 |
87,786 |
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Income tax expense (benefit) |
(16,806) |
(18,047) |
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Net income |
$89,949 |
$105,833 |
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Noncontrolling interests in income (loss) of consolidated subsidiaries |
(1,300) |
1,668 |
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Dividends on preferred stock |
22,395 |
22,411 |
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Net income attributable to common stockholders |
$68,854 |
$81,754 |
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Net income per share of common stock |
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|
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Basic |
$0.14 |
$0.17 |
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Diluted |
$0.14 |
$0.17 |
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Weighted average number of shares of common stock outstanding |
|
|
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Basic |
478,167,178 |
473,715,100 |
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Diluted |
482,846,911 |
480,852,723 |
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Dividends declared per share of common stock |
$0.25 |
$0.25 |
Consolidated Balance Sheets
($ in thousands, except share data)