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Rithm Property Trust Inc. (RPT)·Q2 2025 Earnings Summary

Executive Summary

  • GAAP comprehensive income was $1.4 million, or $0.03 per diluted share; non‑GAAP Earnings Available for Distribution (EAD) was $0.1 million, or $0.00 per diluted share. Book value per share was $5.37, and the company paid a $0.06 common dividend for Q2 2025 .
  • Versus estimates: EPS came in at $0.00 vs Wall Street consensus of $0.01 (miss); revenue was $4.69 million vs consensus of $5.64 million (miss). Management reiterated focus on prudently deploying capital; no formal revenue/EPS guidance provided (*Values retrieved from S&P Global).
  • Sequentially: comprehensive income rose to $1.4 million from $1.1 million, but EAD fell to $0.1 million from $0.7 million; net income attributable to common improved to $0.6 million from a Q1 loss of $(3.7) million .
  • Stock reaction catalysts: management flagged ~$50 million of capital deployment targeted for Q3 with “double‑digit returns,” a robust ~$2 billion pipeline, and intent to bring in third‑party capital on larger transactions to avoid dilution—all potential re‑rating drivers as execution scales .

What Went Well and What Went Wrong

What Went Well

  • Return to positive GAAP common profitability: net income attributable to common was $0.6 million and diluted EPS was $0.01; comprehensive income per diluted share was $0.03 . Management highlighted the turnaround: “Q2 of 2024, the company lost $0.35 per diluted share. If you look at where we are now, we made $0.03 per diluted share” .
  • Balance sheet and liquidity positioned for opportunity: ~$98.6 million in cash and cash equivalents; CMBS and other investments provide optionality for redeployment as spreads evolve .
  • Dividend maintained: paid $0.06 per common share in Q2; management emphasized: “We do not intend to reduce [the dividend] anytime here soon” .

What Went Wrong

  • Core earnings softness: EAD declined to $0.1 million ($0.00 per diluted share) from $0.7 million ($0.02) in Q1, reflecting lower core operating performance despite positive GAAP marks .
  • Expense pressure: total expenses rose modestly to $3.96 million from $3.75 million, with management and professional fees steady to higher, constraining EAD .
  • Estimates miss: EPS was below consensus by $0.01 and revenue below consensus by ~$0.95 million, suggesting slower-than-anticipated scaling of income‑generating assets (*Values retrieved from S&P Global).

Financial Results

Income Statement Highlights (USD)

MetricQ4 2024Q1 2025Q2 2025
Interest Income ($)$12,873,000 $13,200,000 $13,636,000
Interest Expense ($)$(9,239,000) $(9,386,000) $(9,423,000)
Net Interest Income ($)$3,634,000 $3,814,000 $4,213,000
Other Income (Loss) ($)$1,029,000 $(4,535,000) $1,673,000
Net Income (Loss) Attributable to Common ($)$2,914,000 $(3,744,000) $612,000
Diluted EPS ($)$0.06 $(0.08) $0.01
Comprehensive Income ($)—$1,114,000 $1,393,000
Comprehensive Income per Diluted Share ($)—$0.02 $0.03

Notes:

  • Q4 comprehensive income not disclosed in the Q4 8‑K tables; GAAP net income was provided .

Non-GAAP Core Earnings (EAD)

MetricQ4 2024Q1 2025Q2 2025
EAD ($)$323,000 $717,000 $134,000
EAD per Diluted Share ($)$0.01 $0.02 $0.00

Portfolio/Segment Composition (Balance Sheet)

Asset Class ($)Q1 2025Q2 2025
Cash & Cash Equivalents$97,439,000 $98,629,000
Mortgage Loans HFS, net$27,469,000 $27,588,000
Mortgage Loans HFI, net$386,997,000 $378,894,000
CMBS (fair value)$275,541,000 $275,204,000
RMBS (fair value)$48,948,000 $184,065,000
Other Investments$25,941,000 $39,154,000
Total Assets$1,028,331,000 $1,014,373,000

Key Performance Indicators

KPIQ4 2024Q1 2025Q2 2025
Book Value per Common Share ($)$5.44 $5.40 $5.37
Total Equity ($)$246,768,000 $295,920,000 $294,589,000
Common Shares Outstanding45,420,752 45,420,752 45,420,752
Dividend per Common Share ($)$0.06 $0.06 $0.06
Cash & Equivalents ($)$64,252,000 $97,439,000 $98,629,000

Guidance Changes

MetricPeriodPrevious GuidanceCurrent GuidanceChange
Dividend per Common ShareOngoing$0.06 per quarter $0.06 per quarter; “do not intend to reduce” Maintained
Capital DeploymentQ3 2025Not specifiedTargeting ~$50 million deployment with double‑digit returns New/Introduced
Target YieldsMedium TermNot specifiedTarget yields around ~15% across CMBS/loans/mezz/opportunistic equity New/Introduced
Funding ApproachMedium TermNot specifiedPrefer non‑dilutive capital; likely third‑party capital alongside larger transactions; potential use of pref; avoid common issuance at current price Clarified

No formal numeric guidance for revenue, margins, OpEx, OI&E, or tax rate was provided in the quarter’s materials .

Earnings Call Themes & Trends

TopicPrevious Mentions (Q4 2024 & Q1 2025)Current Period (Q2 2025)Trend
Strategic repositioning and brandRebrand to Rithm Property Trust; pivot to commercial real estate; stabilized BV; positive GAAP net income Reiterated opportunistic CRE strategy; “no legacy CRE exposure”; scaling plan Consistent and strengthening
Capital deployment pipelineAdded CMBS ($244m UPB Q4; $274.6m UPB Q1); pref issuance of $50.8m; deployed $64m in Q1 ~$2 billion pipeline; ~11 transactions in process; ~$50m targeted for Q3 Expanding
Funding/dilution strategyPref issuance Q1; no common dilution “Do not intend to dilute shareholders”; third‑party capital alongside larger deals; CMBS book as funding source optionality Clear non‑dilutive stance
Dividend policy$0.06 declared/paid in Q4, Q1 Maintain $0.06; management intent not to cut Maintained
Asset focus (CMBS/loans/mezz)Built CMBS book during wider spreads AAA CMBS at top of stack; loans across retail, multifamily, office; potential industrial; Seattle retail anchor example Diversifying
Execution scale/catalystsEarly in transformation; earnings positive Q4 Larger M&A opportunities contemplated; scale needed to drive earnings toward dividend coverage Building toward scale

Management Commentary

  • “We repositioned the company to be an opportunistic commercial real estate REIT… We intend to do the same here… from $1 billion of equity… to almost $8 billion… We intend to do the same here” .
  • “Current pipeline is in and around $2 billion of assets… we’re sitting on approximately $100 million of cash and liquidity” .
  • “Second quarter… GAAP income… $1.4 million or $0.03 per diluted share. The EAD is about $100,000… Second quarter common stock dividend is $0.06 per common share. We do not intend to reduce that anytime here soon” .
  • “We stayed up in the cap stack… we wanted to deploy capital to create some earnings… We don’t want to dilute shareholders… likely bring in third‑party capital alongside a larger transaction” .
  • “We’re not going to compete for the last dollar… our goal… deploy capital prudently with teens‑type returns” .

Q&A Highlights

  • Pipeline composition and sectors: Pipeline spans AAA CMBS, senior/subordinate/mezzanine loans; near‑term retail asset in Seattle (anchored by Albertsons, Staples), multifamily, and select office; larger M&A opportunities under evaluation .
  • Capital deployment cadence: Management targeting ~$50 million in Q3 deployment, aiming for teens‑type returns; maintaining ~$(100) million liquidity while sourcing non‑dilutive capital (pref or third‑party) .
  • Funding sources and CMBS optionality: CMBS book could be a funding source (sales or leverage) to pivot into direct lending opportunities; preference to raise capital around meaningful transactions to avoid common dilution .
  • Dividend coverage trajectory: Back‑of‑envelope suggests ~$0.02 per quarter earnings contribution from near‑term deployment; scale and larger transactions needed to fully cover dividend over time .
  • Tone: Confident yet patient; focused on prudent underwriting and non‑dilutive growth; explicit push to improve stock price via execution .

Estimates Context

MetricQ1 2025 ConsensusQ1 2025 ActualQ2 2025 ConsensusQ2 2025 Actual
Primary EPS ($)0.015*0.02 0.01*0.00*
Revenue ($)4,829,000*(885,000)*5,640,500*4,694,000*
Primary EPS – # of Estimates2*—3*—
Revenue – # of Estimates2*—2*—

Forward look:

  • Q3 2025 EPS consensus: 0.00*; Target Price consensus: $3.00 (1 estimate)*.

Notes:

  • EPS actual for Q1/Q2 reflects diluted EPS from company filings (Q1: $(0.08); comprehensive per share $0.02; Q2: $0.01; comprehensive per share $0.03). S&P EPS series above reflects “Primary EPS” convention; differences can arise due to methodology and share count treatments .
  • All consensus/target price values marked with * are Values retrieved from S&P Global.

Key Takeaways for Investors

  • Near‑term execution catalyst: ~$50 million of Q3 capital deployment targeted with double‑digit returns; robust ~$2 billion pipeline across loans/mezz/opportunistic equity .
  • Non‑dilutive growth strategy: management intends to avoid common issuance at current prices, preferring preferred equity and third‑party capital alongside larger transactions .
  • Core earnings still below dividend: EAD weakened to $0.00/share; scaling assets and larger deals are needed to bridge to sustainable dividend coverage .
  • Positive GAAP trajectory: sequential improvement to positive net income to common and higher net interest income; marks and other income aided comprehensive income .
  • Portfolio optionality: sizable CMBS holdings and liquidity provide flexibility to recycle into higher‑yield direct lending as opportunities arise .
  • Valuation lever: management highlighted a ~50% discount to book ($5.37 BV/share), pointing to potential upside as scale and earnings materialize .
  • Risk controls: emphasis on prudent underwriting, avoiding bidding wars, and focusing on teens‑type returns across sectors (retail/multifamily/office/industrial) .

Appendix: Additional Quarter‑over‑Quarter Detail

  • Comprehensive income per share: Q4 2024 —; Q1 2025 $0.02; Q2 2025 $0.03 .
  • Expenses: rose to $3.96 million in Q2 from $3.75 million in Q1; related party management fee of $1.60 million (Q2) vs $1.45 million (Q1) .
  • Book value per share: $5.44 (Q4), $5.40 (Q1), $5.37 (Q2); modest compression as assets and AOCI moved .

Citations: All company metrics and statements are from RPT’s Q2 2025 8‑K press release and exhibits –, Q2 2025 earnings call transcript – –, Q1 2025 8‑K and press release –, and Q4 2024 8‑K and press release –. All consensus estimate values marked with * are Values retrieved from S&P Global.