{ "docId": "019de517-e352-747b-9762-0a74ae0959a2", "docSlug": "feb24b9f7493f30af4978892ea7da362", "documentTitle": "Ready Capital | Investor Presentation Deck | 44 slides", "authorId": "ready-capital", "authorName": "Ready Capital", "documentKindSlug": "pitchdeck", "documentKindLabel": "Pitch deck", "sourceTypeSlug": "investor_relations", "sourceTypeLabel": "Investor relations", "presentationDate": "2024-01-01 00:00:00", "orientation": "landscape", "aspectRatio": 1.2938006, "pageNumber": 36, "pageCount": 44, "prevPage": 35, "nextPage": 37, "slideType": "appendix_data", "function": "appendix", "density": "dense", "nDataPoints": 48, "notes": null, "elementsJson": null, "metadataConfidence": 1, "imagePath": null, "slideHref": "/slides/019de517-e352-747b-9762-0a74ae0959a2/36", "deckHref": "/decks/019de517-e352-747b-9762-0a74ae0959a2", "deckJsonHref": "/decks/019de517-e352-747b-9762-0a74ae0959a2.json", "deckAnchorHref": "/decks/019de517-e352-747b-9762-0a74ae0959a2#slide-36", "components": [ { "bbox": { "h": 0.399, "w": 0.909, "x": 0.045, "y": 0.554 }, "kind": "source-note", "text": "Note: The Company believes that this non-US GAAP financial information, in addition to the related US GAAP measures, provides investors greater transparency into the information used by management in its financial and\noperational decision-making, including the determination of dividends. However, because Distributable Earnings is an incomplete measure of the Company's financial performance and involves differences from net income\ncomputed in accordance with US GAAP, it should be considered along with, but not as an alternative to, the Company's net income computed in accordance with US GAAP as a measure of the Company's financial\nperformance. In addition, because not all companies use identical calculations, the Company's presentation of Distributable Earnings may not be comparable to other similarly-titled measures of other companies.\nWe calculate Distributable earnings as GAAP net income (loss) excluding the following:\ni) any unrealized gains or losses on certain MBS not retained by us as part of our loan origination businesses\nii) any realized gains or losses on sales of certain MBS\niii) any unrealized gains or losses on Residential MSRs\niv) any unrealized change in current expected credit loss reserve\nv) any unrealized gains or losses on de-designated cash flow hedges\nvi) any non-cash compensation expense related to stock-based incentive plan\nvii) one-time non-recurring gains or losses, such as gains or losses on discontinued operations, bargain purchase gains, or merger related expenses\nIn calculating Distributable Earnings, Net Income (in accordance with US GAAP) is adjusted to exclude unrealized gains and losses on MBS acquired by the Company in the secondary market but is not adjusted to exclude\nunrealized gains and losses on MBS retained by Ready Capital as part of its loan origination businesses, where the Company transfers originated loans into an MBS securitization and the Company retains an interest in the\nsecuritization. In calculating Distributable Earnings, the Company does not adjust Net Income (in accordance with US GAAP) to take into account unrealized gains and losses on MBS retained by us as part of the loan\norigination businesses because the unrealized gains and losses that are generated in the loan origination and securitization process are considered to be a fundamental part of this business and an indicator of the ongoing\nperformance and credit quality of the Company's historical loan originations. In calculating Distributable Earnings, Net Income (in accordance with US GAAP) is adjusted to exclude realized gains and losses on certain MBS\nsecurities considered to be non-distributable. Certain MBS positions are considered to be non-distributable due to a variety of reasons which may include collateral type, duration, and size. In 2016, the Company liquidated the\nmajority of its MBS portfolio from distributable earnings to fund recurring operating segments.\nIn addition, in calculating Distributable Earnings, Net Income (in accordance with US GAAP) is adjusted to exclude unrealized gains or losses on residential MSRs, held at fair value. The Company treats its commercial MSRs\nand residential MSRs as two separate classes based on the nature of the underlying mortgages and the treatment of these assets as two separate pools for risk management purposes. Servicing rights relating to the\nCompany's small business commercial business are accounted for under ASC 860, Transfer and Servicing, while the Company's residential MSRs are accounted for under the fair value option under ASC 825, Financial\nInstruments. In calculating Distributable Earnings, the Company does not exclude realized gains or losses on either commercial MSRs or residential MSRs, held at fair value, as servicing income is a fundamental part of\nReady Capital's business and is an indicator of the ongoing performance.\nTo qualify as a REIT, the Company must distribute to its stockholders each calendar year at least 90% of its REIT taxable income (including certain items of non-cash income), determined without regard to the deduction for\ndividends paid and excluding net capital gain. There are certain items, including net income generated from the creation of MSRs, that are included in distributable earnings but are not included in the calculation of the current\nyear's taxable income. These differences may result in certain items that are recognized in the current period's calculation of distributable earnings not being included in taxable income, and thus not subject to the REIT\ndividend distribution requirement until future years.", "attrs": {}, "subkind": null, "toolName": null, "toolSlug": null, "confidence": null, "componentId": "bed9ca9a-8883-4b6f-b8b8-7bede26fdd86", "frameworkName": null, "frameworkSlug": null }, { "bbox": { "h": 0.34, "w": 0.909, "x": 0.045, "y": 0.199 }, "kind": "table", "text": "Net Income\nReconciling items:\nUnrealized (gain) loss on MSR\nIncrease (decrease) in CECL reserve\nNon-cash compensation\nMerger transaction costs and other non-recurring expenses\nBargain purchase (gain) loss\nTotal reconciling items\nDistributable earnings before income taxes\nIncome tax adjustments\nDistributable earnings\nLess: Distributable earnings attributable to non-controlling interests\nLess: Income attributable to participating shares\nLess: Dividends on preferred stock\nDistributable earnings attributable to Common Stockholders\nDistributable earnings per share - basic\nWeighted average common shares outstanding - basic", "attrs": {}, "subkind": "data", "toolName": null, "toolSlug": null, "confidence": null, "componentId": "9c6628f0-767e-4a52-97ec-002fa306d25c", "frameworkName": null, "frameworkSlug": null }, { "bbox": { "h": 0.026, "w": 0.587, "x": 0.045, "y": 0.13 }, "kind": "title", "text": "Distributable Earnings Reconciliation—TTM", "attrs": {}, "subkind": "headline", "toolName": null, "toolSlug": null, "confidence": null, "componentId": "18c309a8-275b-4774-b00a-15ba514c8339", "frameworkName": null, "frameworkSlug": null } ], "metrics": [], "tools": [], "frameworks": [], "arcBeats": [ { "to": 37, "from": 30, "beatId": "edb6acb0-7b36-44a2-9977-b99caf34f5c8", "arcName": "The Sequoia Pitch", "arcSlug": "sequoia-pitch", "beatName": "Financials", "beatSlug": "sequoia-pitch-financials", "evidence": "The financial summary section provides an overview of the company's balance sheet and income statement.", "position": 3, "confidence": 0.8, "parentBeatName": "Evidence", "parentBeatSlug": "evidence" } ], "loops": [ { "to": 44, "from": 3, "name": "Golden Circle", "slug": "11-golden-circle", "bestFor": "Visionary leadership, brand positioning, mission statements", "matchId": "683999a5-646d-4eda-a9d3-65d5179730d7", "evidence": "The deck uses a golden circle structure to present the company's why, how, and what.", "position": 0, "objective": "Why Ready Capital is a good investment opportunity", "structure": "The Why (Belief) -> The How (Process) -> The What (Result)", "confidence": 0.7, "description": "Invert the typical pitch by starting with why you exist, rather than what you do" } ], "imagePathAlt": null, "thumbSrc": null, "thumbSrcAlt": null, "locked": true }