Adamas Trust (ADAM) Q2 2025 earnings summary

Executive summary

• Earnings available for distribution exceeded dividends, reflecting strong execution of capital allocation and liquidity strategies, and recurring earnings growth.

• Acquisition of Constructive Loans, LLC was completed, accelerating expansion into business purpose lending and diversifying revenue streams.

• Investment portfolio grew to $8.6 billion, with nearly $800 million deployed into single-family opportunities and business purpose loans.

• Exited remaining multi-family joint venture equity positions, reducing exposure to this segment.

• Focused on targeted investments in residential loans, Agency RMBS, and other mortgage- and credit-related assets.

Financial highlights

• Earnings available for distribution per share rose 10% quarter-over-quarter to $0.22; net interest income and adjusted net interest income increased significantly year-over-year.

• Book value per share was $9.11 and adjusted book value per share was $10.26 at quarter end, both down slightly from the prior quarter.

• Net interest spread increased to 1.50% from 1.33% last year, driven by lower financing costs.

• Interest income rose to $140.9 million in Q2 2025, up from $90.8 million in Q2 2024.

• Quarterly dividend of $0.20 per share was maintained.

Outlook and guidance

• Portfolio composition is positioned to benefit from lower short-term rates and a steepening yield curve.

• Constructive acquisition expected to deliver an annual equity return of ~15% and be immediately accretive to EAD.

• Agency RMBS allocation expected to trend toward 50% of total equity in the medium term.

• Management expects enhanced diversification and value creation through expansion in non-agency credit.

• Minimal new capital allocation to multi-family investments is anticipated.