Summary of Adamas Trust Q2 2026 Earnings Call

1Key Financial Results and Metrics

GAAP Earnings: $43.4 million or $0.48 per share.

Earnings Available for Distribution (EAD): $0.30 per share, marking a 36% year-over-year growth.

Quarterly Dividend: Increased to $0.27 per share, well-covered by EAD.

Book Value: GAAP book value rose to $10.16 per share (+1.8%), while adjusted book value increased to $11.05 per share (+2.3%).

Net Interest Income: Increased to $50.2 million, with a net interest spread of 148 basis points.

Derivative Gains: Contributed $48.8 million, including $33.7 million in realized gains.

2Strategic Updates and Business Highlights

Portfolio Diversification: Adamas has transformed into a diversified mortgage REIT with three main income sources: Agency RMBS, residential credit (business purpose lending), and a vertically integrated origination platform (Constructive).

Investment Portfolio Growth: Expanded by over $800 million to $11.7 billion, a 36% increase year-over-year.

Constructive Performance: The business purpose loan segment saw a record $632 million in loans added. Constructive is positioned as a top 5 specialist in the market.

Operational Efficiency: Initiatives underway to reduce costs and improve funding efficiency are expected to yield approximately $3 million in annual savings.

3Forward Guidance and Outlook

Market Conditions: Despite volatility, the management remains optimistic about the opportunities in the market, particularly in residential credit.

Leverage Strategy: Current leverage is at 5.5x, with potential for slight increases as non-core assets roll off.

Securitization Plans: On track to complete 5 to 6 BPL rental securitizations this year, with a focus on maintaining high collateral quality.

4Bad News, Challenges, or Points of Concern

Market Volatility: The company is navigating a challenging market environment with interest rate fluctuations impacting asset valuations.

Potential Pressure on Asset Valuations: Higher interest rates have led to temporary pressures on the value of Agency RMBS and certain residential loans.

Competitive Landscape: Increased competition in the business purpose lending market may impact margins and pricing.

5Notable Q&A Insights

Constructive Trends: The pipeline for Constructive remains strong, with higher coupons expected. Institutional demand for loans is robust despite market volatility.

Capital Deployment: Incremental capital is expected to be directed towards residential credit rather than rotating out of agency positions, which will remain stable.

Multifamily Book Management: The company is focused on duration management and anticipates consistent payoff rates from the multifamily portfolio, with capital being redeployed into higher-yielding strategies as loans pay off. Overall, Adamas Trust demonstrated strong financial performance in Q2 2026, with a focus on strategic growth and operational efficiency, while also acknowledging the challenges posed by market volatility and competition.