Aug 14, 2026 earnings call — Reverse split and legacy asset resolution
Board approved a 10-for-1 reverse stock split, expected effective at the close on Wednesday, September 9.
Revenue $0.0B (est $0.0B) · EPS $-1.00 (est $0.65)
Key quotes
"We continue to work closely with borrowers and operating partners to maximize outcomes across both performing and nonperforming investments."
"Our Board of Directors recently approved a 10-for-1 reverse stock split of our common stock"
"The $8.6 million in net provision for credit losses recorded during the quarter, which is excluded from distributable earnings was driven primarily by specific reserves on a risk-rated 5 loans."
Analyst Q&A 5
Book value, dividend, sell or merge
Q: Why has book value and the dividend fallen, and can you merge with another company or sell the assets (e.g., at $2.75)?
A: Management said the company’s small size is a challenge and holding liquidity has suppressed earnings while underperforming loans drove losses. They said M&A and other strategic options are reviewed with bankers and the Board, and they would consider a strategic investor or sale, but selling the whole portfolio at recoverable values might be difficult.
"And as we move through these assets and redeploy capital, we should be able to improve earnings as we move forward." — James Flynn (CEO)
Share buyback program status
Q (Lee Zulch · OVERCAP): Is the 12/15/2025 stock repurchase program still in effect and is the $10 million available to buy common shares?
A: Management said repurchasing shares and other strategic alternatives are on the table in discussions with the Board. Jim Briggs confirmed the repurchase program is still open.
"But in general, the question around repurchasing shares and other strategic alternatives are all on the table in discussions with our Board to answer it." — James Flynn (CEO)
Why no buybacks; fix NAV gap
Q: If the buyback plan is open and the stock trades at 25% of NAV, why hasn’t the company bought shares? Any thoughts on closing the gap to NAV?
A: Management said they must balance repurchases with keeping liquidity to resolve underperforming assets. They said the stock price does not reflect fair value and the main way to improve book value is to resolve and remove legacy assets, noting roughly $1 billion of assets outstanding (should be closer to $1.4 billion) and about $300 million (including REO) are inefficiently financed.
"The primary way for us to improve book value is to work through assets and get them resolved off our books and redeployed efficiently." — James Flynn (CEO)
Problem loans timing and causes
Q: Are most problem loans from 2021–2022? Do listed maturities include extensions? Are problems from bad management or lack of renovation capital? Any change to underwriting or parent help?
A: Management said yes, most troubled assets are from 2021 into early 2023, a period across the industry when assets were often overvalued. They said the supplemental shows the current maturity date (including extensions) and that many bridge loans have a total maturity of 5 years (usually 3 years initial term with 2, 1-year extensions). They added troubled loans are often due to sponsors running out of capital rather than only bad skill, and they are evaluating stronger sponsors and ways to box or move risk with investors.
"That would generally be correct, maybe into early '23, but that is generally the, kind of across the industry and our portfolio, the time of the most challenged assets, typically valuation issues, meaning they were overvalued to begin with." — James Flynn (CEO)
Dividend, management fees, big trade prints
Q: Why declare a $0.04 dividend late in the quarter when you likely knew results; can you internalize management to cut fees; what caused the 5 million share prints at month end?
A: On the dividend, management said the Board approved $0.04 based on projections at the time, but some resolutions produced larger losses than expected and they will re-evaluate dividends next quarter. On internalization, they said it is unlikely and could increase fees because of caps on reimbursable fees and expenses. On the large prints, James Briggs said the trades were due to Russell 3000 index rebalancing when the company was added and later removed.
"Based on the projections at the time, we felt that $0.04 dividend was appropriate for the quarter based on where we expected things to be." — James Flynn (CEO)