AFC Gamma Provides Business Update
2023年6月15日 - 9:30PM
AFC Gamma, Inc. (NASDAQ:AFCG) (“AFC Gamma” or the “Company”) today
provided a business update for its operations through June 15,
2023, including declaring a dividend for the quarter ending June
30, 2023, announcing a share repurchase program, and sharing
certain portfolio updates.
Dividend for Quarter Ending June 30, 2023
The Board of Directors of AFC Gamma declared a
quarterly dividend for the quarter ending June 30, 2023 of $0.48
per outstanding share of common stock, payable on July 14, 2023 to
the common stockholders of record on June 30, 2023. The $0.48
quarterly dividend represents an annual run rate of $1.92.
Management anticipates that the June quarterly dividend represents
a sustainable dividend level on the current portfolio, assuming no
significant non-accruals and without any additional investments.
The $0.48 dividend level takes into account recent repayments we
have received and cash drag associated with the current liquidity
on our balance sheet, including from those recent repayments. We
remain focused on deploying capital into deals with strong risk
adjusted returns both in cannabis and traditional real estate
loans, but expect reduced earnings until the cash is deployed and
leverage is drawn.
AFC Gamma’s stated policy is to pay dividends
between 85% and 100% of ordinary income for each calendar year. If
our annual dividend falls below the stated range due to increased
earnings, we will consider paying a special dividend at the end of
the year to stay within the stated range.
Share Repurchase Program
Since the beginning of 2023, certain executives
of the Company have purchased approximately $2.9 million worth of
AFC Gamma stock in the aggregate. Given the current volatility in
AFC Gamma’s share price, the Board of Directors has approved a
share repurchase program, authorizing the Company to repurchase up
to $20 million of its outstanding common stock.
At management's discretion, the shares may be
acquired from time to time in the open market, through privately
negotiated transactions or otherwise in compliance with
Rule 10b-18 and Rule 10b5-1 under the Securities Exchange
Act of 1934. The Board of Directors has also authorized the Company
to establish a Rule 10b5-1 trading plans that will permit the
Company to repurchase its outstanding shares at times when it might
otherwise be prevented from doing so.
This share repurchase program does not obligate
the Company to acquire any particular amount of its outstanding
shares and the timing and exact amount of repurchases will depend
on various factors, including the performance of the Company’s
stock price, general market and other conditions, applicable legal
requirements and other factors. This share repurchase program is
authorized until December 31, 2025 and may be suspended, modified
or discontinued at any time.
Portfolio Update
Our portfolio management team continues to
navigate the challenging cannabis environment. Since our last
earnings call, we have sold two-thirds of the Private Company I
credit facility, which was a Category 4 loan under our CECL
analysis as of March 31, 2023 and was placed in foreclosure in May
2023. We sold our portion of the credit facility at par plus
accrued interest to a multi-state cannabis operator and have a put
right on the remaining one-third immediately prior to the transfer
of one of the borrower’s cannabis licenses. AFC Gamma also received
(i) a paydown of approximately $5.9 million on its portion of the
Private Company A credit facility from the borrower’s sale of its
Maryland assets and (ii) a repayment of all principal, accrued
interest and exit fees upon maturity of the credit facility to Sub.
of Private Company H. Lastly, on our last earnings call we
discussed Private Company G, which had capitalized a substantial
amount of its interest over a limited period. This period has now
ended, and we are pleased to report that we have so far received
60% of the borrower’s June interest payment in cash with a payment
plan to receive the rest of the June interest payment in cash over
the course of this month. Although the borrower is trending in a
positive direction, we still view this loan as risky and continue
to closely monitor it.
Deploying capital in traditional real estate is
still proving challenging in this environment given the bid-ask
spread between buyers and sellers, higher interest costs that have
made certain construction projects uneconomical and the overhang of
a potential recession, which has put absorption rates into
question. Given the noticeable pullback by regional banks from the
commercial real estate market, we are seeing quality deal flow, yet
believe there is a longer time frame to deploy capital, which may
lead to additional cash drag.
About AFC Gamma, Inc.
AFC Gamma, Inc. (NASDAQ:AFCG) is a
publicly-traded, institutional lender that originates, structures
and underwrites loans secured by commercial real estate and other
types of financing solutions. AFC Gamma targets direct lending and
bridge loan opportunities typically ranging from $5 million to $100
million across multiple real estate sectors, with a specialization
in lending to state-law compliant cannabis operators. It is based
in West Palm Beach, Florida.
Forward-Looking Statements
This release contains forward-looking statements
within the meaning of the Private Securities Litigation Reform Act
of 1995 that reflect our current views and projections with respect
to, among other things, future events and financial performance.
Words such as “believes,” “expects,” “will,” “intends,” “plans,”
“guidance,” “estimates,” “projects,” “anticipates,” and “future” or
similar expressions are intended to identify forward-looking
statements. These forward-looking statements, including statements
about our anticipated dividend level, our investment portfolio, our
future growth and strategies for such growth, are subject to the
inherent uncertainties in predicting future results and conditions
and are not guarantees of future performance, conditions or
results. Certain factors, including the ability of our manager to
locate suitable loan opportunities for us, monitor and actively
manage our loan portfolio and implement our investment strategy;
the demand for commercial real estate investment and cannabis
cultivation and processing facilities; management’s current
estimate of expected credit losses and current expected credit loss
reserve and other factors could cause actual results and
performance to differ materially from those projected in these
forward-looking statements. More information on these risks and
other potential factors that could affect our business and
financial results is included in AFC Gamma’s filings with the SEC,
including in the “Risk Factors” and “Management’s Discussion and
Analysis of Financial Condition and Results of Operations” sections
of AFC Gamma’s most recently filed periodic reports on Form 10-K,
Form 10-Q and subsequent filings. New risks and uncertainties arise
over time, and it is not possible to predict those events or how
they may affect AFC Gamma. We do not undertake any obligation to
publicly update or revise any forward-looking statements, whether
as a result of new information, future events or otherwise, except
as required by law.
Investor Relations
AFC GAMMA, INC. INVESTOR CONTACT:Robyn
Tannenbaum561-510-2293 ir@afcgamma.comwww.afcgamma.com
AFC GAMMA, INC. MEDIA CONTACT:Profile
AdvisorsRich Myers / Rachel Goun(347)
343-2999rmyers@profileadvisors.com
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