ARR - ARMOUR Residential REIT Inc. Announces Q1 Results and March 31 2024 Financial Position | Benzinga
VERO BEACH, Florida, April 25, 2024 (GLOBE NEWSWIRE) -- ARMOUR Residential REIT, Inc. (NYSE:ARR) ("ARMOUR" or the "Company") today announced the Company's unaudited Q1 results and March 31, 2024 financial position.
ARMOUR's Q1 2024 Results
- GAAP net income available to common stockholders of $11.5 million or $0.24 per common share.
- Net interest income of $5.3 million.
- Expenses included $9.0 million of non-recurring professional fees related to the Special Committee internal investigation, disclosed in our most recent Annual Report on Form 10-K.
- Distributable Earnings available to common stockholders of $40.4 million, which represents $0.82 per common share (see explanation of this non-GAAP measure on page 4).
- Average interest income on interest earning assets of 4.89% and interest cost on average interest bearing liabilities of 5.36%.
- Economic interest income was 4.83% less economic interest expense of 3.02% for an economic net interest spread of 1.81% (see explanation of this non-GAAP measure on page 6).
- Paid common stock dividends of $0.24 per share per month, or $0.72 per share for Q1.
ARMOUR's March 31, 2024 Financial Position
- Book value per common share of $22.07 resulting from:
| Book Value, December 31, 2023 |
| $ |
| 22.54 |
| Net Income per common share |
| 0.24 |
| Less: Common dividends per common share |
| (0.72 |
| ) |
| Equity Capital Activities, net |
| 0.01 |
| Book Value, March 31, 2024 |
| $ |
| 22.07 |
- Liquidity, including cash and unencumbered agency and U.S. government securities, of $659.3 million.
- Agency mortgage-backed securities ("MBS") portfolio totaled $10.9 billion.
- Repurchase agreements, net totaled $8.7 billion; 56.2% were with ARMOUR affiliate BUCKLER Securities LLC.
- Debt to equity ratio of 6.94:1 (based on repurchase agreements divided by total stockholders' equity). Implied leverage, including TBA Securities and forward settling sales and unsettled purchases was 7.07:1.
- Interest Rate swap contracts totaled $7.2 billion of notional amount, representing 83% of total repurchase agreement and TBA Securities.
Book value per common share consisted of:
| March 31, 2024 |
| December 31, 2023 |
| (in millions except per share) |
| Common stock, at par value - 48,751,806 and 48,798,954 shares outstanding, respectively |
| $ |
| 0.1 |
| $ |
| 0.1 |
| Additional paid-in capital |
| 4,317.9 |
| 4,318.2 |
| Cumulative distributions to stockholders |
| (2,258.9 |
| ) |
| (2,220.6 |
| ) |
| Accumulated net loss |
| (812.0 |
| ) |
| (826.5 |
| ) |
| Total Stockholders' Equity |
| $ |
| 1,247.1 |
| 1,271.2 |
| Less: liquidation preference - 7.00% Cumulative Redeemable Preferred C Stock - 6,846,978 shares outstanding |
| (171.2 |
| ) |
| (171.2 |
| ) |
| Equity Attributable to Common Stockholders |
| $ |
| 1,075.9 |
| $ |
| 1,100.0 |
| Book value per common share |
| $ |
| 22.07 |
| $ |
| 22.54 |
The major drivers of the change in the Company's financial position were:
| Q1 2024 |
| Q4 2023 |
| (in millions) |
| Total Stockholders' Equity – Beginning |
| $ |
| 1,271.2 |
| $ |
| 1,236.1 |
| Income (Loss) |
| Investment in securities: |
| Gain (Loss) on MBS |
| $ |
| (137.7 |
| ) |
| $ |
| 452.9 |
| Gain (Loss) on U.S. Treasury Securities |
| 10.9 |
| (48.6 |
| ) |
| Loss on TBA Securities |
| (4.3 |
| ) |
| (2.3 |
| ) |
| Gain (Loss) on interest rate swaps |
| 160.7 |
| (277.3 |
| ) |
| Loss on futures contracts |
| — |
| (19.6 |
| ) |
| Net Interest Income |
| 5.3 |
| 5.8 |
| Total Expenses after fees waived (1) |
| (20.4 |
| ) |
| (11.3 |
| ) |
| Net Income |
| $ |
| 14.5 |
| $ |
| 99.6 |
| Preferred stock dividends |
| (3.0 |
| ) |
| (3.0 |
| ) |
| Common stock dividends |
| (35.3 |
| ) |
| (59.0 |
| ) |
| Capital Activities |
| Issuance of common stock |
| 1.0 |
| 0.8 |
| Common shares repurchased |
| (1.3 |
| ) |
| (3.3 |
| ) |
| Total Stockholders' Equity – Ending |
| $ |
| 1,247.1 |
| $ |
| 1,271.2 |
(1) The Company's external manager has waived a portion of its contractual management fee at the rate of $1.65 million per quarter for each of Q1 2024 and Q4 2023.
| Condensed Balance Sheet (unaudited) |
| March 31, 2024 |
| December 31, 2023 |
| (in millions) |
| Assets |
| Cash |
| $ |
| 221.3 |
| $ |
| 221.9 |
| Cash collateral posted to counterparties |
| 38.2 |
| 37.0 |
| Agency Securities, at fair value |
| 10,905.9 |
| 11,159.8 |
| Receivable for unsettled sales |
| 36.0 |
| — |
| Derivatives, at fair value |
| 959.7 |
| 877.4 |
| Accrued interest receivable |
| 46.2 |
| 47.1 |
| Prepaid and other |
| 1.0 |
| 1.2 |
| Total Assets |
| $ |
| 12,208.3 |
| $ |
| 12,344.4 |
| Liabilities |
| Repurchase agreements, net |
| $ |
| 8,654.1 |
| $ |
| 9,648.0 |
| Obligations to return securities received as collateral, at fair value |
| 1,101.6 |
| 350.3 |
| Cash collateral posted by counterparties |