Blackstone Mortgage Trust, Inc. (NYSE:BXMT) Q4 2018 Earnings Conference Call Transcript

Feb 13, 2019 • 10:00 am ET


Blackstone Mortgage Trust, Inc. (NYSE:BXMT) Q4 2018 Earnings Conference Call Transcript


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Good day, and welcome, everyone, to the Blackstone Mortgage Trust Fourth Quarter and Full Year 2018 Investor Call hosted by Weston Tucker, Head of Investor Relations. My name is Matthew and I'm your operator today. During the presentation your lines will remain on listen-only. (Operator Instructions) I'd like to advise all parties this conference is being recorded for replay purposes.

And now, I'd like to hand over to Weston. Please go ahead.

Weston M. Tucker

Great. Thanks, Matthew, and good morning, everyone, and welcome to Blackstone Mortgage Trust's fourth quarter conference call. I'm joined today by Steve Plavin, President and CEO; Jonathan Pollack, Global Head of Blackstone Real Estate Debt Strategies; Tony Marone, Chief Financial Officer; Doug Armer, Managing Director and Head of Capital Markets; and Katie Keenan, Managing Director of Blackstone Real Estate Debt Strategies.

Last night, we filed our 10-K and issued a press release with the presentation of our results which are available on our website and have been filed with the SEC. I'd like to remind everyone that today's call may include forward-looking statements which are uncertain and outside of the Company's control. Actual results may differ materially. For a discussion of some of the risks that could affect results, please see the Risk Factors section of our most recent 10-K. We do not undertake any duty to update these statements and we will also refer to certain non-GAAP measures on this call, and for reconciliations, you should refer to the press release and our 10-K. This audiocast is copyrighted material of Blackstone Mortgage Trust and may not be duplicated without our consent.

So a quick recap of our results. We reported GAAP net income per share of $0.61 for the fourth quarter and $2.50 for the full year. Core earnings were $0.69 per share for the quarter and $2.90 for the year, up from $2.55 in the prior year. A few weeks ago, we paid a dividend of $0.62 with respect to the quarter, reflecting an attractive annualized yield of 7.2% based on yesterday's closing stock price. If you have any questions following today's call, please let me know.

And with that, I'll now turn things over to Steve.

Stephen D. Plavin

Thanks, Weston, and good morning, everyone. An excellent fourth quarter capped an extraordinary year for BXMT. We originated $3.5 billion of loans in the quarter and $10.7 billion for the year, our most active ever. In 2018, we grew our portfolio by $4.7 billion to $15.8 billion, while maintaining an origination LTV of 62%. The portfolio growth helped drive core earnings to $2.90 per share, which produced a 117% dividend coverage.

The strong coverage reflects our focus in the quality of the dividend, which is generated solely from our pure play senior lending business and we are able to retain the excess earnings, which contributed to our increase in book value during the year. In Q4, we closed 21 loans, our highest ever quarterly loan count exclusive of the GE portfolio acquisition in 2015. We had several originations during the