Chicago Atlantic Real Estate Finance (REFI) Reports Fourth Quarter 2024 Financial Earnings Results

Chicago Atlantic Real Estate Finance, Inc. (REFI) today announced its financial results for the recent quarter. The company reported a quarterly revenue of $15.48 million, surpassing the revenue estimate of $14.57 million, marking a positive revenue beat. However, the earnings per share (EPS) came in at $0.39, which fell short of the estimated $0.51, resulting in an EPS miss. Despite the earnings miss, the revenue growth highlights the company’s strong performance in the real estate finance sector.

Key Highlights:

• Chicago Atlantic Real Estate Finance, Inc. reported a total loan principal outstanding of $410.2 million as of December 31, 2024, with a portfolio weighted average yield to maturity of approximately 17.2%.
• The company originated $90.7 million in gross loans during the fourth quarter, with $52.6 million funded to new borrowers.
• Chicago Atlantic entered into a $50.0 million unsecured term loan with a fixed interest rate of 9.0% and a maturity date of October 2028.
• The company paid a regular quarterly cash dividend of $0.47 per share and a special cash dividend of $0.18 per share for the fourth quarter of 2024.
• Net income for the fourth quarter was approximately $7.9 million, with distributable earnings of approximately $9.2 million.
• For the full year 2024, net interest income was approximately $55.0 million, with net income of approximately $37.0 million.
• The company expects to maintain a dividend payout ratio of approximately 90% to 100% of distributable earnings for 2025.

Summary:

Chicago Atlantic Real Estate Finance, Inc. reported strong financial results for the fourth quarter and full year 2024, with a total loan principal outstanding of $410.2 million across 30 portfolio companies. The company maintained a disciplined underwriting process, focusing on strong operators and cash flow to manage downside risk. This approach has positioned Chicago Atlantic as the largest platform focused on cannabis and the third best exchange-listed mortgage REIT on a total return basis. Co-CEO Peter Sack emphasized the company’s consistent process and strong liquidity, which enabled portfolio growth and a pipeline of nearly $500 million. The company originated $90.7 million in gross loans during the fourth quarter, with a significant portion funded to new borrowers.

Financially, Chicago Atlantic reported net income of approximately $7.9 million for the fourth quarter, with distributable earnings of $9.2 million. The company paid a regular quarterly cash dividend of $0.47 per share and a special cash dividend of $0.18 per share. For the full year 2024, net interest income was approximately $55.0 million, with net income of $37.0 million. Looking ahead to 2025, the company expects to maintain a dividend payout ratio of 90% to 100% of distributable earnings. The company’s strategic focus on the cannabis sector and disciplined financial management are expected to continue driving growth and shareholder value.

Chicago Atlantic Real Estate Finance, Inc. (REFI) has demonstrated a resilient performance over the past year, with its stock price appreciating by 10.57%. This upward trend is supported by a robust six-month gain of 9.30% and a three-month increase of 2.36%, indicating a steady recovery and investor confidence. However, the recent one-week and one-month declines of 1.06% and 0.06%, respectively, suggest some short-term volatility. On the fundamental side, REFI boasts a compelling price-to-earnings ratio of 7.91, which may attract value investors. The company’s earnings per share (EPS) has grown at an impressive two-year compound annual growth rate (CAGR) of 50.38%, while revenue has expanded at a 24.11% CAGR over the same period. Despite these positive metrics, the negative return on invested capital of -7.76% raises concerns about the efficiency of capital deployment. Nevertheless, the staggering free cash flow growth of 5500.61% over two years highlights REFI’s strong cash generation capabilities, which could support future growth initiatives.

Chicago Atlantic Real Estate Finance, Inc. operates as a commercial real estate finance company in the United States. It originates, structures, and invests in first mortgage loans and alternative structured financings secured by commercial real estate properties. The company offers senior loans to state-licensed operators and property owners in the cannabis industry. It has elected to be taxed as a real estate investment trust (REIT) and would not be subject to federal corporate income taxes if it distributes at least 90% of its taxable income to its stockholders. The company was incorporated in 2021 and is based in Chicago, Illinois.