Colony NorthStar Credit Real Estate, Inc. (CLNC) Misses Q1 EPS by 19c

Colony NorthStar Credit Real Estate, Inc. (NYSE: CLNC) reported Q1 EPS of $0.09, $0.19 worse than the analyst estimate of $0.28.

• First quarter 2019 GAAP net income attributable to common stockholders of $14.9 million, or $0.11 per common share, and core earnings of $11.8 million, or $0.09 per diluted share. Excluding: (i) $35.5 million of realized losses related to completed foreclosure proceedings under a mezzanine loan; and (ii) $2.0 million of realized losses and transactions costs associated with the sale of real estate private equity interests: core earnings of $49.3 million, or $0.38 per diluted share. The Company already recorded a $35.5 million loan loss provision in the fourth quarter 2018 in connection with this anticipated foreclosure
• GAAP book value of $2.7 billion, or $20.86 per diluted share, as of March 31, 2019
• Undepreciated book value of $2.9 billion, or $21.68 per diluted share, as of March 31, 2019
• Declared and paid a monthly cash dividend of $0.145 per share of Class A common stock for January, February, and March 2019. The dividend represents an annualized dividend of $1.74 per share of common stock, equating to an 11.0% annualized dividend yield based on the $15.85 closing price on May 6, 2019
• Subsequent to quarter end, the Company’s Board of Directors declared a monthly cash dividend of $0.145 per share of common stock for April and May 2019
• During the first quarter, consummated or executed binding purchase and sale agreements for the sale of 89% of the Company’s $161 million interests in real estate private equity funds for a sales price of approximately $142 million. Since December 2018, the Company has received approximately $63 million in cash proceeds, with the substantial portion of the remaining $79 million in proceeds anticipated in the second quarter of 2019
• During the first quarter, allocated and initially funded $278 million and $225 million of capital, respectively, across eight investments
• During the first quarter, completed a $35 million upsize under the accordion feature of the corporate revolving credit facility, increasing total commitments from $525 million to $560 million
• Subsequent to quarter end, amended two master repurchase facilities to allow for European investments concurrent with $200 million aggregate upsize; total master repurchase capacity now at approximately $2.3 billion, with approximately $1.2 billion of current excess capacity
• Subsequent to quarter end, allocated and initially funded an additional $206 million and $184 million of capital, respectively, across three investments
• As of May 6, 2019, total corporate liquidity of approximately $346 million through cash-on-hand and availability under the corporate revolving credit facility

Kevin P. Traenkle, President and Chief Executive Officer of Colony Credit Real Estate, commented, “2019 is off to a good start for Colony Credit Real Estate. Our operating performance is on budget and we have successfully executed the first of our planned strategic transactions -- the disposal of approximately 89% of our interests in real estate private equity funds. The aggregate sales price of approximately $142 million is in line with the Company’s carrying value on such interests. Furthermore, the Company has already received $63 million in proceeds, with the substantial portion of the remaining $79 million of proceeds anticipated in the second quarter of 2019.”

Mr. Traenkle added, “As these private equity interests did not meaningfully contribute to the Company’s 2018 core earnings, we expect the reinvestment of these proceeds into targeted assets to be highly accretive.”

For earnings history and earnings-related data on Colony NorthStar Credit Real Estate, Inc. (CLNC) click here.

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