TPG RE Finance Trust, Inc. Reports Operating Results for the Quarter Ended, June 30, 2020
July 29 2020 - 4:38PM
Business Wire
TPG RE Finance Trust, Inc. (NYSE: TRTX) (“TRTX” or the
“Company”) reported its operating results for the quarter ended
June 30, 2020. For the second quarter of 2020, GAAP net income
attributable to common stockholders was $40.1 million, net income
per diluted common share was $0.52, and book value per common share
at June 30, 2020 was $16.55.
SECOND QUARTER 2020 ACTIVITY
- Generated GAAP net income attributable to common stockholders
of $40.1 million, or $0.52 per diluted common share, based on a
weighted average share count of 76.6 million common shares.
- Increased net interest margin to $44.2 million during the three
months ending June 30, 2020 compared to $41.8 million for the three
months ended June 30, 2019 and $43.3 million for the three months
ended March 31, 2020, an increase of $2.4 million, or 5.7%, over
the same period of the prior year, and an increase of $0.9 million,
or 2.1%, over the prior quarter.
- Issued and sold, for an aggregate cash purchase price of $225.0
million, 9.0 million shares of 11.0% Series B Cumulative Redeemable
Preferred Stock (“Series B Preferred Stock”), and detachable,
five-year, net settled warrants to purchase up to 12.0 million
shares of TRTX common stock at an exercise price of $7.50 per
share, to an investment fund managed by Starwood Capital Group
(“SCG”). TRTX may elect to sell to SCG, at any time prior to
December 31, 2020, up to 4.0 million shares of Series B Preferred
Stock and warrants to purchase 3.0 million shares of TRTX common
stock for an additional aggregate purchase price of $100.0 million,
which may be issued in two tranches.
- Declared on June 16, 2020 a dividend per common share of $0.20
which was paid on July 24, 2020 to shareholders of record as of
June 26, 2020. Paid on June 30, 2020 a dividend on the Series B
Preferred Stock of $2.25 million, or $0.25 per preferred share, for
the period from issuance through June 29, 2020.
- Recorded a reduction in allowance for credit loss of $24.3
million, driven by the reversal of the reserve associated with one
loan sold during the second quarter of 2020 of $24.8 million,
offset by an increase in the general reserve of $0.5 million.
- Funded $62.5 million of unfunded commitments in connection with
existing loans.
- Financed on a non-recourse, non-mark-to-market basis, four
loans or participation interests therein totaling $64.6 million
using available reinvestment capacity in TRTX 2018-FL2 and TRTX
2019-FL3. These reinvestments generated net cash proceeds of $22.5
million after repaying $42.1 million of existing financing. At June
30, 2020, 52.4% of the Company’s financings were without recourse
or mark-to-market provisions.
- Extended secured revolving repurchase and credit agreements
with Morgan Stanley Bank, N.A. ($500.0 million commitment through
May 4, 2021), Goldman Sachs Bank USA ($250.0 million commitment
through August 19, 2021) and Bank of America, N.A. ($200.0 million
commitment through September 29, 2021). The latter two facilities
include options for future increases in commitments to $500.0
million each.
- Held at quarter-end cash and cash equivalents of $196.2 million
and had undrawn capacity under secured borrowing arrangements of
$56.1 million, of which $46.2 million was immediately
available.
- Benefited from LIBOR floors on our loan portfolio with a
weighted average LIBOR of 1.67%, approximately 151 basis points
higher than one-month LIBOR as of June 30, 2020.
Greta Guggenheim, Chief Executive Officer, commented: “Our focus
this quarter was on strengthening our balance sheet and actively
managing each of our existing loan positions. The earnings capacity
of our portfolio and its attractive net interest margin enabled us
to offset unusually high expenses this quarter, many of which were
COVID-related. We repaid our credit facilities by $157.7 million,
extended the maturity of three facilities, and improved our
liquidity position. We remain focused on maximizing shareholder
value through these unprecedented times.”
The Company issued a supplemental presentation detailing its
second quarter 2020 operating results, which can be viewed at
http://investors.tpgrefinance.com/.
CONFERENCE CALL AND WEBCAST INFORMATION
The Company will host a conference call and webcast to review
its financial results with investors and other interested parties
at 8:30 a.m. ET on Thursday, July 30, 2020. The call will be hosted
by Greta Guggenheim, Chief Executive Officer, and Bob Foley, Chief
Financial Officer. To participate in the conference call, callers
from the United States and Canada should dial +1 (877) 407-9716,
and international callers should dial +1 (201) 493-6779, ten
minutes prior to the scheduled call time. The webcast may also be
accessed live by visiting the Company’s investor relations website
at http://investors.tpgrefinance.com/event.
REPLAY INFORMATION
A replay of the conference call will be available after 11:30
a.m. ET on Thursday, July 30, 2020 through 11:59 p.m. ET on
Thursday, August 13, 2020. To access the replay, listeners may use
+1 (844) 512-2921 (domestic) or +1 (412) 317-6671 (international).
The passcode for the replay is 13707047. The recorded replay will
be available on the Company’s website for one year after the call
date.
ABOUT TRTX
TPG RE Finance Trust, Inc. is a commercial real estate finance
company that originates, acquires, and manages primarily first
mortgage loans secured by institutional properties located in
primary and select secondary markets in the United States. The
Company is externally managed by TPG RE Finance Trust Management,
L.P., a part of TPG Real Estate, which is the real estate
investment platform of global alternative asset firm TPG. For more
information regarding TRTX, visit
https://www.tpgrefinance.com/.
FORWARD-LOOKING STATEMENTS
The information contained in this earnings release contains
“forward-looking statements” within the meaning of Section 27A of
the Securities Act of 1933, as amended, and Section 21E of the
Securities Exchange Act of 1934, as amended. These forward-looking
statements are subject to various risks and uncertainties,
including, without limitation, statements relating to the
performance of the investments of the Company; the ultimate
geographic spread, severity and duration of pandemics such as the
recent outbreak of novel coronavirus (“COVID-19”), actions that may
be taken by governmental authorities to contain or address the
impact of such pandemics, and the potential negative impacts of
such pandemics on the global economy and the Company’s financial
condition and results of operations; the Company’s ability to
originate loans that are in the pipeline and under evaluation by
the Company; and financing needs and arrangements. Forward-looking
statements are generally identifiable by use of forward-looking
terminology such as “may,” “will,” “should,” “potential,” “intend,”
“expect,” “endeavor,” “seek,” “anticipate,” “estimate,” “believe,”
“could,” “project,” “predict,” “continue” or other similar words or
expressions. Forward-looking statements are based on certain
assumptions, discuss future expectations, describe existing or
future plans and strategies, contain projections of results of
operations, liquidity and/or financial condition or state other
forward-looking information. Statements, among others, relating to
the continuing impact of COVID-19 on the Company’s business,
financial condition and results of operations and the Company’s
ability to generate future growth and deliver returns are
forward-looking statements, and the Company cannot assure you that
TRTX will achieve such results. The ability of TRTX to predict
future events or conditions or their impact or the actual effect of
existing or future plans or strategies is inherently uncertain.
Although the Company believes that such forward-looking statements
are based on reasonable assumptions, actual results and performance
in the future could differ materially from those set forth in or
implied by such forward-looking statements. You are cautioned not
to place undue reliance on these forward-looking statements, which
reflect the Company’s views only as of the date of this earnings
release. Except as required by law, neither the Company nor any
other person assumes responsibility for the accuracy and
completeness of the forward-looking statements appearing in this
earnings release. The Company does not undertake any obligation to
update any forward-looking statements contained in this earnings
release as a result of new information, future events or
otherwise.
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INVESTOR RELATIONS: +1 (212) 405-8500
IR@tpgrefinance.com
MEDIA: TPG RE Finance Trust, Inc. Courtney Power +1 (415)
743-1550 media@tpg.com
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