PennyMac Mortgage Investment Trust (PMT, Financial) released its earnings report for the third quarter of 2023 on October 26, 2023. The company reported a net income attributable to common shareholders of $51.0 million, or $0.51 per common share on a diluted basis. The net investment income for the quarter stood at $163.4 million. PMT previously announced a cash dividend for the third quarter of 2023 of $0.40 per common share of beneficial interest, which was declared on August 31, 2023, and will be paid on October 27, 2023, to common shareholders of record as of October 13, 2023.
Financial Performance and Highlights
Chairman and CEO David Spector commented on the company's performance, stating,
PMT produced a 14 percent annualized return on equity in the third quarter, reflecting strong financial results and growth in book value per share from the prior quarter."He also noted that the company took several steps to strengthen PMT's balance sheet, including the upsize of a previously-issued Fannie Mae term loan, the redemption of Fannie Mae term notes due in 2025, and the opportunistic issuance of unsecured senior debt at very attractive terms.
Segment Contributions
The company's segments, consisting of Credit Sensitive Strategies, Interest Rate Sensitive Strategies, Correspondent Production, and Corporate, all contributed to the overall financial results. The Credit Sensitive Strategies segment reported a pretax income of $41.0 million on net investment income of $41.5 million. The Interest Rate Sensitive Strategies segment reported a pretax income of $81.6 million on net investment income of $104.5 million. The Correspondent Production segment generated a pretax income of $8.8 million, and the Corporate segment revenues were $2.3 million.
Balance Sheet Summary
As of September 30, 2023, the company's total assets stood at $13.2 billion, with liabilities amounting to $11.3 billion. The total shareholders' equity was reported at $1.9 billion. The company recorded a tax expense of $57.0 million, primarily driven by fair value gains on MSRs held in PMT’s taxable subsidiary.
Looking Ahead
CEO David Spector expressed optimism about PMT's future financial performance, citing a seasoned investment portfolio and a run-rate return potential that has increased from last quarter due to a steeper yield curve.
Explore the complete 8-K earnings release (here) from PennyMac Mortgage Investment Trust for further details.
