Sachem Capital logs 26% gain in earnings amid rising interest rates

Sachem Capital Corp. (NYSE: SACH) has disclosed its financial performance for the fiscal year ending on December 31, 2023. The company was set to conduct a conference call on Monday, April 1, 2024, at 8:00 a.m. Eastern Time to delve into its financial and operational outcomes.

John Villano, CPA, the Chief Executive Officer of Sachem Capital, highlighted the company’s strategic focus amidst the challenges faced in 2023.

Despite a complex macroeconomic environment marked by rising interest rates, commercial real estate weaknesses, and banking sector hurdles, Sachem Capital managed to achieve a 26% revenue growth compared to the previous year.

However, due to fluctuations in the values of certain commercial properties securing their loans, the company experienced a 29.4% decline in net income attributable to common shareholders and a 40.1% decrease in earnings per share.

Financial Highlights for the Year Ended December 31, 2023

• Total Revenue: Surged by 25.5% to $65.6 million, driven by the expansion of the mortgage portfolio and increased borrower rates.
• Operating Costs: Totaled $49.7 million, with significant increases in interest expenses and amortization of financing costs.
• Net Income: Attributable to common shareholders was approximately $12.1 million, translating to $0.27 per share, down from $17.2 million in 2022.

Balance Sheet Overview

• Total Assets: Rose by nearly 11% to $625.5 million, primarily due to growth in the mortgage loan portfolio and investments.
• Total Liabilities: Stood at $395.5 million, reflecting an increase from the previous year.
• Total Shareholders’ Equity: Increased to $230.1 million, with additional paid-in capital contributing significantly to the rise.

Dividends and REIT Status

• Dividends: A quarterly dividend of $0.11 per share was declared on March 28, 2024, payable on April 16, 2024.
• REIT Status: Sachem Capital operates as a Real Estate Investment Trust (REIT) and intends to continue qualifying and operating as such, adhering to the requirement of distributing a minimum of 90% of taxable income to shareholders annually.