Annaly has Another Year of Exceptional Returns
NEW YORK--(BUSINESS WIRE)--Feb. 5, 2001--Annaly Mortgage Management, Inc. (NYSE: NLY) today reported earnings for the quarter ended December 31, 2000 of $4,093,873 or $0.28 per average share outstanding. Earnings for the year ended December 31, 2000 were $16,567,288 or $1.18 per average share outstanding.
For the year ended December 31, 2000, the yield on average earnings assets was 7.02% and the cost of funds on the average repurchase balance was 6.41%. For the year ended December 31, 1999, the yield on average assets was 6.15% and the cost of funds on the average repurchase balance was 5.17%. The interest rate spread decreased to 0.61% in 2000 from 0.98% for the prior year. For the year ended December 31, 2000, the Company's gain on sale of assets was $2,025,205, as compared to the prior year of $454,782. During the year Annaly was able to take advantage of appreciation in portfolio value and gains were taken on the liquidation of assets. General and administration expenses, as a percent of average assets was 0.14% and 0.15% for the years ended December 31, 2000 and 1999, respectively. General and administration expenses were materially unchanged for the year 2000, even though the Company's asset size increased. With the significant decline in spread income in the year 2000, the Company was still able to provide a return on average equity of 14.09%. Dividends declared for the year were $1.15 per share. The dividend yield for the year, based on the December 29, 2000 closing price of 9 1/16, was 12.69%.
At December 31, 2000, Annaly had a book value of $9.34, which was a 23% increase from the December 31, 1999 book value of $7.60. The book value increased by 12% from the September 30, 2000 book value of $8.30. The Company classifies all investment securities as "available for sale." Consequently, the entire portfolio is recorded at market value, which was $1,978,219,376 at December 31, 2000. Leverage at December 31, 2000 was 12.0:1, as compared to 12.9:1 at December 31, 1999. Fixed rate Mortgage-Backed Securities comprised approximately 26% of the portfolio at December 31, 2000. The balance of the portfolio is comprised of 50% Adjustable Rate Mortgages (ARMS) and 24% LIBOR Floating Rate Collateralized Mortgage Obligations (CMO Floaters). The Company has continued to avoid the introduction of credit risk in its portfolio. All of the assets in the portfolio are FNMA, GNMA or FHLMC securities, which carry an implied "AAA" rating. No derivatives, interest rate swaps, swaptions, options, currency swaps, total rate of return swaps were acquired. All assets in the portfolio were REIT eligible assets.
During the fourth quarter, the Company raised $1.7 million in the dividend reinvestment and share purchase plan. As previously reported, the Company completed a secondary offerings of 9,800,000 shares of company common stock on January 29, 2001. The aggregate net proceeds to the company (after deducting estimated expenses) are estimated to be $87.4 million. The company has granted the underwriters an option, exercisable for 30 days, to purchase up to 1,350,000 additional shares of common stock to cover over-allotments.
"This past year has been yet another volatile one for the bond market, especially the mortgage-backed securities market. When spreads on mortgage product hit their widest levels in late spring and early summer of 2000, we viewed this as an opportunity to better position the portfolio. As the Fed eases to provide stability in the slowing economy, Annaly stands to benefit from lower financing cost." according to Kristopher Konrad, Portfolio Manager. |
