New Residential Investment Corp. (NYSE:NRZ; “New Residential” or the
“Company”) today reported the following information for the third
quarter ended September 30, 2015:
THIRD QUARTER FINANCIAL HIGHLIGHTS:*
-
Record Core Earnings of $0.49 per diluted share, or $113 million
-
GAAP Income of $0.24 per diluted share, or $55 million
-
Increased third quarter common dividend to $0.46 per share, or $106
million
|
|
|
Q3 2015
|
|
|
Q2 2015
|
|
|
Q1 2015
|
Non-GAAP Results:
|
|
|
|
|
|
|
|
|
|
Core Earnings per Diluted Share*
|
|
|
$0.49
|
|
|
$0.45
|
|
|
$0.44
|
Core Earnings*
|
|
|
$113 million
|
|
|
$92 million
|
|
|
$63 million
|
|
|
|
|
|
|
|
|
|
|
Summary Operating Results:
|
|
|
|
|
|
|
|
|
|
GAAP Net Income per Diluted Share
|
|
|
$0.24
|
|
|
$0.37
|
|
|
$0.25
|
GAAP Net Income
|
|
|
$55 million
|
|
|
$75 million
|
|
|
$36 million
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
NRZ Common Dividend:
|
|
|
|
|
|
|
|
|
|
Common Dividend per Share
|
|
|
$0.46
|
|
|
$0.45
|
|
|
$0.38
|
Common Dividend
|
|
|
$106 million
|
|
|
$90 million
|
|
|
$54 million
|
|
|
|
|
|
|
|
|
|
|
*Core Earnings is a non-GAAP measure. For a reconciliation of Core
Earnings to GAAP Net Income, please refer to the Reconciliation
of Core Earnings below.
Third Quarter 2015 & Subsequent Highlights:
-
Servicer Advances -
-
$1.5 Billion Servicer Advance Securitization -
During the quarter, New Residential closed a $1.5 billion servicer
advance securitization, the first widely marketed servicer advance
securitization in the past 18 months. Through the securitization,
New Residential issued $800 million of fixed rate notes; benefits
of the financing include reduction of the Company's interest rate
exposure, lower cost of funds and improved advance rates.
-
Repayment of $2.5 Billion HSART Term Notes at Par -
On October 2, 2015, New Residential repaid $2.5 billion of term
notes issued by the HLSS Servicer Advance Receivables Trust
(“HSART”) by accessing $4 billion of previously secured surplus
servicer advance financing commitments from its lenders. Under New
Residential’s surplus funding commitments, the Company was able to
increase advance rates by approximately 6% and free up
approximately $200 million of additional liquidity.
-
Servicer Advance Investments - During and subsequent
to the third quarter, New Residential purchased approximately $300
million of servicer advance debt, and expects mid-teens IRR.
-
Non-Agency Securities & Call Rights - New
Residential continued to execute on its deal collapse strategy by
exercising clean-up call rights on seven seasoned, Non-Agency deals
totaling $216 million UPB in the third quarter and initiating the
exercise of clean-up call rights on an additional 14 seasoned
Non-Agency deals totaling $350 million UPB subsequent to quarter end.
-
Excess MSRs - Subsequent to quarter end, New Residential
funded previously announced commitments on $19 billion UPB of legacy
MSRs, with an additional $6 billion UPB of commitments to settle. In
addition, the Company recently obtained eligibility to own MSRs across
30 U.S. states, with remaining state and Agency approvals currently
expected in 4Q 2015 and 1H 2016. (1)
-
FHLB Membership - New Residential is currently seeking
membership to the Cincinnati Branch of the Federal Home Loan Bank,
which the Company expects will help lower borrowing costs and increase
financing flexibility.
-
Dividend Increase - On September 22, 2015, New
Residential announced an increase to its regular quarterly cash
dividend to $0.46 per common share in the third quarter of 2015, from
$0.45 per common share for the second quarter of 2015. This marks the
second time New Residential has increased the quarterly dividend this
year.
-
Appointment of New Chief Financial Officer - On
September 22, 2015, New Residential announced the appointment of
Nicola Santoro, Jr. as the Company’s new Chief Financial Officer. Mr.
Santoro succeeded Jonathan Brown, who served as New Residential’s
Interim Chief Financial Officer since October 2014. Mr. Brown remains
at New Residential in his role as Chief Accounting Officer.
(1) Eligibility obtained as of the date of this press release
relates to Non-Agency MSRs only.
ADDITIONAL INFORMATION
For additional information that management believes to be useful for
investors, please refer to the latest presentation posted on the
Investor Relations section of the Company’s website, www.newresi.com.
For consolidated investment portfolio information, please refer to the
Company’s most recent Annual Report on Form 10-K and Quarterly Report on
Form 10-Q, which are available on the Company’s website (www.newresi.com).
EARNINGS CONFERENCE CALL
New Residential’s management will host a conference call on Tuesday,
November 3, 2015 at 8:00 A.M. Eastern Time. A copy of the earnings
release will be posted to the Investor Relations section of New
Residential’s website, www.newresi.com.
All interested parties are welcome to participate on the live call. The
conference call may be accessed by dialing 1-866-393-1506 (from within
the U.S.) or 1-706-634-0623 (from outside of the U.S.) ten minutes prior
to the scheduled start of the call; please reference “New Residential
Third Quarter 2015 Earnings Call.”
A simultaneous webcast of the conference call will be available to the
public on a listen-only basis at www.newresi.com.
Please allow extra time prior to the call to visit the website and
download any necessary software required to listen to the internet
broadcast.
A telephonic replay of the conference call will also be available two
hours following the call’s completion through 11:59 P.M. Eastern Time on
Tuesday, November 17, 2015 by dialing 1-855-859-2056 (from within the
U.S.) or 1-404-537-3406 (from outside of the U.S.); please reference
access code “66706628.”
|
|
|
|
|
|
|
Condensed Consolidated Statements of Income
($ in thousands, except share and per share data)
(unaudited)
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended September 30,
|
|
|
Nine Months Ended September 30,
|
|
|
|
|
2015
|
|
|
|
2014
|
|
|
|
2015
|
|
|
|
2014
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest income
|
|
|
$
|
182,341
|
|
|
|
$
|
97,587
|
|
|
$
|
444,891
|
|
|
|
$
|
261,733
|
Interest expense
|
|
|
|
77,558
|
|
|
|
|
33,307
|
|
|
|
193,408
|
|
|
|
|
108,816
|
Net Interest Income
|
|
|
|
104,783
|
|
|
|
|
64,280
|
|
|
|
251,483
|
|
|
|
|
152,917
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Impairment
|
|
|
|
|
|
|
|
|
|
|
|
|
Other-than-temporary impairment ("OTTI") on securities
|
|
|
|
1,574
|
|
|
|
|
-
|
|
|
|
3,294
|
|
|
|
|
943
|
Valuation provision (reversal) on loans and real estate owned
|
|
|
|
(3,341
|
)
|
|
|
|
1,134
|
|
|
|
2,408
|
|
|
|
|
1,591
|
|
|
|
|
(1,767
|
)
|
|
|
|
1,134
|
|
|
|
5,702
|
|
|
|
|
2,534
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net interest income after impairment
|
|
|
|
106,550
|
|
|
|
|
63,146
|
|
|
|
245,781
|
|
|
|
|
150,383
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other Income
|
|
|
|
|
|
|
|
|
|
|
|
|
Change in fair value of investments in excess mortgage servicing
rights
|
|
|
|
1,131
|
|
|
|
|
28,566
|
|
|
|
(274
|
)
|
|
|
|
40,670
|
Change in fair value of investments in excess mortgage servicing
rights, equity method
investees
|
|
|
|
8,427
|
|
|
|
|
31,833
|
|
|
|
16,443
|
|
|
|
|
50,950
|
Change in fair value of investments in servicer advances
|
|
|
|
(18,738
|
)
|
|
|
|
22,948
|
|
|
|
(1,845
|
)
|
|
|
|
105,825
|
Earnings from investments in consumer loans, equity method investees
|
|
|
|
-
|
|
|
|
|
22,490
|
|
|
|
-
|
|
|
|
|
60,185
|
Gain (loss) on settlement of investments, net
|
|
|
|
(16,409
|
)
|
|
|
|
938
|
|
|
|
(441
|
)
|
|
|
|
57,834
|
Other income (loss), net
|
|
|
|
7,764
|
|
|
|
|
15,289
|
|
|
|
18,237
|
|
|
|
|
19,539
|
|
|
|
|
(17,825
|
)
|
|
|
|
122,064
|
|
|
|
32,120
|
|
|
|
|
335,003
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating Expenses
|
|
|
|
|
|
|
|
|
|
|
|
|
General and administrative expenses
|
|
|
|
19,563
|
|
|
|
|
7,499
|
|
|
|
49,362
|
|
|
|
|
14,886
|
Management fee to affiliate
|
|
|
|
9,860
|
|
|
|
|
5,124
|
|
|
|
23,357
|
|
|
|
|
14,525
|
Incentive compensation to affiliate
|
|
|
|
1,811
|
|
|
|
|
10,910
|
|
|
|
7,895
|
|
|
|
|
33,111
|
Loan servicing expense
|
|
|
|
1,668
|
|
|
|
|
1,778
|
|
|
|
9,510
|
|
|
|
|
2,210
|
|
|
|
|
32,902
|
|
|
|
|
25,311
|
|
|
|
90,124
|
|
|
|
|
64,732
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income Before Income Taxes
|
|
|
|
55,823
|
|
|
|
|
159,899
|
|
|
|
187,777
|
|
|
|
|
420,654
|
Income tax expense (benefit)
|
|
|
|
(5,932
|
)
|
|
|
|
7,801
|
|
|
|
4,947
|
|
|
|
|
29,483
|
Net Income
|
|
|
$
|
61,755
|
|
|
|
$
|
152,098
|
|
|
$
|
182,830
|
|
|
|
$
|
391,171
|
Noncontrolling Interests in Income of Consolidated Subsidiaries
|
|
|
$
|
7,230
|
|
|
|
$
|
25,726
|
|
|
$
|
17,174
|
|
|
|
$
|
92,524
|
Net Income Attributable to Common Stockholders
|
|
|
$
|
54,525
|
|
|
|
$
|
126,372
|
|
|
$
|
165,656
|
|
|
|
$
|
298,647
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Income Per Share of Common Stock
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
|
$
|
0.24
|
|
|
|
$
|
0.89
|
|
|
$
|
0.87
|
|
|
|
$
|
2.22
|
Diluted
|
|
|
$
|
0.24
|
|
|
|
$
|
0.88
|
|
|
$
|
0.85
|
|
|
|
$
|
2.16
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted Average Number of Shares of Common Stock Outstanding
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
|
|
230,455,568
|
|
|
|
|
141,211,580
|
|
|
|
191,259,587
|
|
|
|
|
134,814,020
|
Diluted
|
|
|
|
231,215,235
|
|
|
|
|
144,166,601
|
|
|
|
194,081,345
|
|
|
|
|
137,972,639
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Dividends Declared per Share of Common Stock
|
|
|
$
|
0.46
|
|
|
|
$
|
0.35
|
|
|
$
|
1.29
|
|
|
|
$
|
1.20
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Condensed Consolidated Balance Sheets
($ in thousands)
|
|
|
|
|
|
|
|
|
|
|
|
September 30, 2015
|
|
|
|
December 31, 2014
|
Assets
|
|
|
(unaudited)
|
|
|
|
|
Investments in:
|
|
|
|
|
|
|
|
Excess mortgage servicing rights, at fair value
|
|
|
$
|
1,459,690
|
|
|
|
$
|
417,733
|
Excess mortgage servicing rights, equity method investees, at fair
value
|
|
|
|
213,318
|
|
|
|
|
330,876
|
Servicer advances, at fair value
|
|
|
|
7,499,775
|
|
|
|
|
3,270,839
|
Real estate securities, available-for-sale
|
|
|
|
2,428,729
|
|
|
|
|
2,463,163
|
Residential mortgage loans, held-for-investment
|
|
|
|
40,813
|
|
|
|
|
47,838
|
Residential mortgage loans, held-for-sale
|
|
|
|
713,917
|
|
|
|
|
1,126,439
|
Real estate owned
|
|
|
|
29,454
|
|
|
|
|
61,933
|
Consumer loans, equity method investees
|
|
|
|
-
|
|
|
|
|
-
|
Cash and cash equivalents
|
|
|
|
348,312
|
|
|
|
|
212,985
|
Restricted cash
|
|
|
|
165,039
|
|
|
|
|
29,418
|
Derivative assets
|
|
|
|
1,318
|
|
|
|
|
32,597
|
Trade receivable
|
|
|
|
2,031,425
|
|
|
|
|
-
|
Deferred tax asset
|
|
|
|
162,788
|
|
|
|
|
-
|
Other assets
|
|
|
|
261,640
|
|
|
|
|
95,423
|
|
|
|
$
|
15,356,218
|
|
|
|
$
|
8,089,244
|
|
|
|
|
|
|
|
|
Liabilities and Equity
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Liabilities
|
|
|
|
|
|
|
|
Repurchase agreements
|
|
|
$
|
3,773,880
|
|
|
|
$
|
3,149,090
|
Notes payable
|
|
|
|
7,245,200
|
|
|
|
|
2,908,763
|
Trades payable
|
|
|
|
1,059,232
|
|
|
|
|
2,678
|
Due to affiliates
|
|
|
|
12,398
|
|
|
|
|
57,424
|
Dividends payable
|
|
|
|
106,011
|
|
|
|
|
53,745
|
Deferred tax liability
|
|
|
|
-
|
|
|
|
|
15,114
|
Accrued expenses and other liabilities
|
|
|
|
133,426
|
|
|
|
|
52,505
|
|
|
|
|
12,330,147
|
|
|
|
|
6,239,319
|
|
|
|
|
|
|
|
|
Commitments and Contingencies
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Equity
|
|
|
|
|
|
|
|
Common Stock, $0.01 par value, 2,000,000,000 shares authorized,
230,458,866 and 141,434,905 issued and outstanding at September
30, 2015 and December 31, 2014, respectively
|
|
|
|
2,304
|
|
|
|
|
1,414
|
Additional paid-in capital
|
|
|
|
2,640,680
|
|
|
|
|
1,328,587
|
Retained earnings
|
|
|
|
151,838
|
|
|
|
|
237,769
|
Accumulated other comprehensive income, net of tax
|
|
|
|
11,711
|
|
|
|
|
28,319
|
Total New Residential stockholders' equity
|
|
|
|
2,806,533
|
|
|
|
|
1,596,089
|
Noncontrolling interests in equity of consolidated subsidiaries
|
|
|
|
219,538
|
|
|
|
|
253,836
|
Total Equity
|
|
|
|
3,026,071
|
|
|
|
|
1,849,925
|
|
|
|
$
|
15,356,218
|
|
|
|
$
|
8,089,244
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reconciliation of Core Earnings
($ in thousands)
|
|
|
|
|
|
|
|
|
|
Three Months Ended September 30,
|
|
Nine Months Ended September 30,
|
|
|
|
|
2015
|
|
|
|
|
2014
|
|
|
|
|
2015
|
|
|
|
|
2014
|
|
Net income (loss) attributable to common stockholders
|
|
|
$
|
54,525
|
|
|
|
$
|
126,372
|
|
|
|
$
|
165,656
|
|
|
|
$
|
298,647
|
|
Impairment
|
|
|
|
(1,767
|
)
|
|
|
|
1,134
|
|
|
|
|
5,702
|
|
|
|
|
2,534
|
|
Other Income Adjustments:
|
|
|
|
|
|
|
|
|
|
|
|
|
Other Income
|
|
|
|
|
|
|
|
|
|
|
|
|
Change in fair value of investments in excess mortgage servicing
rights
|
|
|
|
(1,131
|
)
|
|
|
|
(28,566
|
)
|
|
|
|
274
|
|
|
|
|
(40,670
|
)
|
Change in fair value of investments in excess mortgage servicing
rights, equity method investees
|
|
|
|
(8,427
|
)
|
|
|
|
(31,833
|
)
|
|
|
|
(16,443
|
)
|
|
|
|
(50,950
|
)
|
Change in fair value of investments in servicer advances
|
|
|
|
18,738
|
|
|
|
|
(22,948
|
)
|
|
|
|
1,845
|
|
|
|
|
(105,825
|
)
|
Earnings from investments in consumer loans, equity method investees
|
|
|
|
-
|
|
|
|
|
(22,490
|
)
|
|
|
|
-
|
|
|
|
|
(60,185
|
)
|
(Gain) loss on settlement of investments, net
|
|
|
|
16,409
|
|
|
|
|
(938
|
)
|
|
|
|
441
|
|
|
|
|
(57,834
|
)
|
Unrealized (gain) loss on derivative
instruments
|
|
|
|
14,239
|
|
|
|
|
(4,799
|
)
|
|
|
|
22,498
|
|
|
|
|
(2,355
|
)
|
(Gain) loss on transfer of loans to REO
|
|
|
|
(1,272
|
)
|
|
|
|
(5,167
|
)
|
|
|
|
(1,075
|
)
|
|
|
|
(11,861
|
)
|
Gain on consumer loans investment
|
|
|
|
(14,385
|
)
|
|
|
|
-
|
|
|
|
|
(33,342
|
)
|
|
|
|
-
|
|
Fee earned on deal termination
|
|
|
|
-
|
|
|
|
|
(5,000
|
)
|
|
|
|
-
|
|
|
|
|
(5,000
|
)
|
Other (income) loss
|
|
|
|
1,354
|
|
|
|
|
(323
|
)
|
|
|
|
2,182
|
|
|
|
|
(323
|
)
|
Other Income attributable to non-controlling interests
|
|
|
|
(3,261
|
)
|
|
|
|
12,619
|
|
|
|
|
(11,084
|
)
|
|
|
|
57,360
|
|
Total Other Income Adjustments
|
|
|
|
22,264
|
|
|
|
|
(109,445
|
)
|
|
|
|
(34,704
|
)
|
|
|
|
(277,643
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Incentive compensation to affiliate
|
|
|
|
1,811
|
|
|
|
|
10,910
|
|
|
|
|
7,895
|
|
|
|
|
33,111
|
|
Non-capitalized transaction-related expenses
|
|
|
|
13,213
|
|
|
|
|
1,433
|
|
|
|
|
28,103
|
|
|
|
|
3,258
|
|
Deferred taxes
|
|
|
|
(5,455
|
)
|
|
|
|
4,459
|
|
|
|
|
5,885
|
|
|
|
|
20,762
|
|
Interest income on residential mortgage loans, held-for-sale
|
|
|
|
3,327
|
|
|
|
|
-
|
|
|
|
|
20,410
|
|
|
|
|
-
|
|
Core earnings of equity method investees:
|
|
|
|
|
|
|
|
|
|
|
|
|
Excess mortgage servicing rights
|
|
|
|
6,182
|
|
|
|
|
9,158
|
|
|
|
|
16,617
|
|
|
|
|
27,029
|
|
Consumer loans
|
|
|
|
18,544
|
|
|
|
|
18,628
|
|
|
|
|
52,760
|
|
|
|
|
53,080
|
|
Core Earnings
|
|
|
$
|
112,644
|
|
|
|
$
|
62,649
|
|
|
|
$
|
268,324
|
|
|
|
$
|
160,778
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CORE EARNINGS
New Residential has four primary variables that impact the Company’s
operating performance: (i) the current yield earned on the Company’s
investments, (ii) the interest expense incurred under the debt incurred
to finance the Company’s investments, (iii) the Company’s operating
expenses and taxes and (iv) the Company’s realized and unrealized gains
or losses, including any impairment and deferred tax, on the Company’s
investments. “Core earnings” is a non-GAAP measure of the Company’s
operating performance excluding the fourth variable above and adjusting
the earnings from the consumer loan investment to a level yield basis.
It is used by management to gauge the Company’s current performance
without taking into account: (i) realized and unrealized gains and
losses, which although they represent a part of the Company’s recurring
operations, are subject to significant variability and are only a
potential indicator of future economic performance; (ii) incentive
compensation paid to the Company’s Manager; (iii) non-capitalized
transaction-related expenses; and (iv) deferred taxes, which are not
representative of current operations.
While incentive compensation paid to the Company’s Manager may be a
material operating expense, the Company excludes it from core earnings
because (i) from time to time, a component of the computation of this
expense will relate to items (such as gains or losses) that are excluded
from core earnings, and (ii) it is impractical to determine the portion
of the expense related to core earnings and non-core earnings, and the
type of earnings (loss) that created an excess (deficit) above or below,
as applicable, the incentive compensation threshold. To illustrate why
it is impractical to determine the portion of incentive compensation
expense that should be allocated to core earnings, the Company notes
that, as an example, in a given period, the Company may have core
earnings in excess of the incentive compensation threshold but incur
losses (which are excluded from core earnings) that reduce total
earnings below the incentive compensation threshold. In such case, the
Company would either need to (a) allocate zero incentive compensation
expense to core earnings, even though core earnings exceeded the
incentive compensation threshold, or (b) assign a “pro forma” amount of
incentive compensation expense to core earnings, even though no
incentive compensation was actually incurred. The Company believes that
neither of these allocation methodologies achieves a logical result.
Accordingly, the exclusion of incentive compensation facilitates
comparability between periods and avoids the distortion to the Company’s
non-GAAP operating measure that would result from the inclusion of
incentive compensation that relates to non-core earnings.
With regard to non-capitalized transaction-related expenses, management
does not view these costs as part of the Company’s core operations.
Non-capitalized transaction-related expenses are generally legal and
valuation service costs, as well as other professional service fees,
incurred when the Company acquires certain investments, as well as costs
associated with the acquisition and integration of acquired businesses,
including any litigation settlement expense. These costs are recorded as
“General and administrative expenses” in the Company’s Condensed
Consolidated Statements of Income. “Other (income) loss” set forth above
excludes $8.5 million accrued during the nine months ended September 30,
2015 related to a reimbursement from Ocwen for certain increased costs
resulting from further S&P servicing rating downgrade of Ocwen.
In the fourth quarter of 2014, the Company modified the Company’s
definition of core earnings to include accretion on held-for-sale loans
as if they continued to be held-for-investment. Although the Company
intends to sell such loans, there is no guarantee that such loans will
be sold or that they will be sold within any expected timeframe. During
the period prior to sale, the Company continues to receive cash flows
from such loans and believe that it is appropriate to record a yield
thereon. This modification had no impact on core earnings in 2014 or any
prior period. In the second quarter of 2015, the Company modified the
Company’s definition of core earnings to exclude all deferred taxes,
rather than just deferred taxes related to unrealized gains or losses,
because deferred taxes are not representative of current operations.
This modification was applied prospectively due to only immaterial
impacts in prior periods.
Management believes that the adjustments to compute “core earnings”
specified above allow investors and analysts to readily identify the
operating performance of the assets that form the core of the Company’s
activity, assist in comparing the core operating results between
periods, and enable investors to evaluate the Company’s current
performance using the same measure that management uses to operate the
business.
The primary differences between core earnings and the measure the
Company uses to calculate incentive compensation relate to (i) realized
gains and losses (including impairments), (ii) non-capitalized
transaction-related expenses and (iii) deferred taxes (other than those
related to unrealized gains and losses). Each are excluded from core
earnings and included in the Company’s incentive compensation measure
(either immediately or through amortization). In addition, the Company’s
incentive compensation measure does not include accretion on held-for-
sale loans and the timing of recognition of income from consumer loans
is different. Unlike core earnings, the Company’s incentive compensation
measure is intended to reflect all realized results of operations.
Core earnings does not represent and should not be considered as a
substitute for, or superior to, net income, net income per share of
common stock as a substitute for, or superior to, cash flow from
operating activities, each as determined in accordance with U.S. GAAP,
and the Company’s calculations of this measure may not be comparable to
similarly entitled measures reported by other companies.
ABOUT NEW RESIDENTIAL
New Residential focuses on opportunistically investing in, and
actively managing, investments related to residential real estate. The
Company primarily targets investments in mortgage servicing related
assets and other related opportunistic investments. New Residential is
organized and conducts its operations to qualify as a real estate
investment trust (“REIT”) for federal income tax purposes. The Company
is managed by an affiliate of Fortress Investment Group LLC (NYSE: FIG),
a global investment management firm.
FORWARD-LOOKING STATEMENTS
Certain statements in this press release may constitute forward-looking
statements within the meaning of the Private Securities Litigation
Reform Act of 1995, such as statements regarding expected IRR, ability
to obtain and timing for obtaining state and Agency approvals for MSR
licensing, ability to obtain membership to the Cincinnati Branch of the
Federal Home Loan Bank and whether obtaining such membership will help
the Company lower borrowing costs and increase financing flexibility.
These statements are based on management's current expectations and
beliefs and are subject to a number of trends and uncertainties that
could cause actual results to differ materially from those described in
the forward-looking statements, many of which are beyond the Company’s
control. The Company can give no assurance that its expectations will be
attained. Accordingly, you should not place undue reliance on any
forward-looking statements contained in this press release. For a
discussion of some of the risks and important factors that could affect
such forward-looking statements, see the sections entitled “Risk
Factors” and “Management’s Discussion and Analysis of Financial
Condition and Results of Operations” incorporated by reference in the
Company’s Annual Reports on Form 10-K and Quarterly Reports on Form
10-Q, which are available on the Company’s website (www.newresi.com).
In addition, new risks and uncertainties emerge from time to time, and
it is not possible for the Company to predict or assess the impact of
every factor that may cause its actual results to differ from those
contained in any forward-looking statements. Such forward-looking
statements speak only as of the date of this press release. The Company
expressly disclaims any obligation to release publicly any updates or
revisions to any forward-looking statements contained herein to reflect
any change in the Company's expectations with regard thereto or change
in events, conditions or circumstances on which any statement is based.
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