Newcastle Announces Second Quarter 2010 Results
Second Quarter 2010 Financial Results
NEW YORK--(BUSINESS WIRE)-- Newcastle Investment Corp. (NYSE: NCT) reported that for the quarter ended June 30, 2010, income applicable to common stockholders ("GAAP income") was $118 million, or $1.90 per diluted share, compared to a loss applicable to common stockholders of $47 million, or $0.90 per diluted share, for the quarter ended June 30, 2009.
GAAP income of $118 million consisted of the following: $22 million of net interest income less expenses (net of preferred dividends), $53 million of other income, and $43 million from the reversal of prior valuation allowances on loans net of the impairment on securities.
Other income is primarily related to a gain on the extinguishment of CDO debt. In the second quarter, Newcastle repurchased a face amount of $64 million of CDO bonds for $17 million, recording a $47 million gain on the extinguishment of debt.
During the quarter, the Company completed a securitization transaction to refinance its Manufactured Housing Loans Portfolio I. The Company received unrestricted cash of $14 million and retained the residual interest in the securitization.
For a reconciliation of income (loss) applicable to common stockholders to net interest income less expenses (net of preferred dividends), please refer to the tables following the presentation of the GAAP results.
Recourse Debt Financing and Liquidity
In the second quarter, the Company increased unrestricted cash by $26 million and repaid $19 million of non-agency recourse debt; the remaining $1 million of non-agency recourse debt was repaid in July. The Company currently does not have any short-term recourse debt.
Certain details regarding the Company's liquidity and current financings are set forth below as of August 4, 2010:
-- Cash - The Company had unrestricted cash of $41 million. In addition, the Company had $122 million of restricted cash for reinvestment in its CDOs; -- Margin Exposure - The Company had no financings or derivatives subject to margin calls.
The following table illustrates the change in unrestricted cash and recourse financings, excluding junior subordinated notes ($ in millions):
August 4, June 30, March 31, 2010 2010 2010 Unrestricted Cash $ 41 $ 38 $ 12 Recourse Financings Non-FNMA/FHLMC (non-agency) Real Estate Securities, Loans, and Properties - - 13 Manufacturing Housing Loans - 1 7 Total Recourse Financings $ - $ 1 $ 20
CDO Financings
The following table summarizes the cash receipts in the second quarter of 2010 from the Company's consolidated CDO financings, their related coverage tests, and negative watch assets ($ in thousands):
Interest Coverage % Excess Over Collateralization Excess (Deficiency) Primary (Deficiency) Assets on Collateral Negative Type Cash July 31, July 31, 2010(2) June 30, 2010(2) March 31, 2010(2) Watch(3) Receipts (1) 2010(2) % $ % $ % $ CDO Securities $ 153 109.5 % -7.8 % (28,647 ) -7.8 % (28,647 ) -7.1 % (26,531 ) $ 87,911 IV CDO V Securities 868 230.1 % 0.8 % 3,173 0.8 % 3,173 -4.0 % (17,622 ) 133,823 CDO Securities 126 64.2 % -40.7 % (166,380 ) -39.6 % (162,467 ) -24.8 % (108,077 ) 17,042 VI CDO Loans 5,915 253.5 % 16.1 % 103,683 15.9 % 102,714 9.7 % 62,404 90,438 VIII CDO Loans 5,693 172.2 % 9.7 % 62,727 9.4 % 60,531 10.9 % 70,156 68,000 IX CDO X Securities 2,572 152.5 % 2.3 % 27,546 2.4 % 28,892 6.0 % 73,577 113,015 Total $ 15,327 $ 510,229 Represents net cash received from each CDO based on all of the interests in such CDO (including senior (1) management fees). Cash receipts for the quarter ended June 30, 2010 may not be indicative of cash receipts for subsequent periods. See Forward-Looking Statements below for risks and uncertainties that could cause cash receipts for subsequent periods to differ materially from these amounts. Represents excess or deficiency under the applicable interest coverage or over collateralization test to the first threshold at which cash flow would be redirected. The Company generally does not receive material cash (2) flow from a CDO until a deficiency is corrected. The information regarding coverage tests is based on data from the most recent remittance date on or before July 31, 2010, June 30, 2010, or March 31, 2010, as applicable. The CDO IV and V tests are conducted only on a quarterly basis (December, March, June and September). Represents the face amount of assets on negative watch for possible downgrade by at least one rating agency (Moody's, S&P or Fitch). Amounts are as of the determination date pertaining to June 2010 remittances for CDO (3) IV and V (these tests are conducted only on a quarterly basis) and as of the determination date pertaining to July 2010 remittances for all other CDOs. The amounts include $213 million of bonds issued by Newcastle, which are eliminated in consolidation and not reflected in the investment portfolio disclosures.
-- $2 million of the $15 million CDO cash receipts were senior collateral management fees, which were not subject to their related CDO coverage tests. -- The cash receipts above also include $5 million of non-recurring interest, prepayment, extension and yield maintenance fees received in the CDOs.
Book Value
GAAP book value increased by $280 million or $4.53 per share. As of June 30, 2010, GAAP book value was $(899) million or $(14.49) per share compared to $(1.2) billion or $(19.02) per share at March 31, 2010.
Dividends
For the quarter ended June 30, 2010, Newcastle's Board of Directors elected not to pay a common stock or preferred stock dividend. The Company decided to retain capital to further reduce recourse debt and for working capital purposes.
Investment Portfolio
Newcastle's $4.8 billion investment portfolio (with a basis of $3.1 billion) consists of commercial, residential and corporate debt. During the quarter, the portfolio decreased by $64 million, primarily as a result of principal repayments of $176 million, sales of $96 million and actual principal write-downs of $47 million, offset by purchases of $248 million at an average price of 76% of par, an average yield of 15.3% and an average life of 4.6 years.
The following table describes the investment portfolio as of June 30, 2010 ($ in millions):
% of Weighted Face Basis Total Number of Average Amount $ Amount $ Basis Investments Credit Life (1) (2) (yrs)(3) Commercial Assets CMBS $ 2,092 $ 1,345 44.1 % 272 BB 2.9 Mezzanine 716 314 10.3 % 20 71% 2.1 Loans B-Notes 284 125 4.1 % 10 77% 2.0 Whole Loans 85 50 1.6 % 4 84% 4.0 Total Commercial 3,177 1,834 60.1 % 2.7 Assets Residential Assets MH and Residential 454 387 12.7 % 11,926 699 6.6 Loans Subprime 395 174 5.7 % 89 B- 4.4 Securities Real Estate 81 58 1.9 % 22 BB 4.7 ABS 930 619 20.3 % 5.5 FNMA/FHLMC 4 4 0.1 % 1 AAA 3.5 Securities Total Residential 934 623 20.4 % 5.5 Assets Corporate Assets REIT Debt 390 389 12.8 % 46 BB+ 3.5 Corporate 306 206 6.7 % 9 C 3.6 Bank Loans Total Corporate 696 595 19.5 % 3.6 Assets Total/Weighted $ 4,807 $ 3,052 100.0 % 3.3 Average(4) (1) Net of impairment. Credit represents the weighted average of minimum ratings for rated assets, the Loan to Value ratio (based on the appraised value at the time of purchase) for non-rated commercial assets, or the FICO score for (2) non-rated residential assets and an implied AAA rating for FNMA/FHLMC securities. Ratings provided above were determined by third party rating agencies as of a particular date, may not be current and are subject to change (including a "negative watch" assignment) at any time. (3) Weighted average life is based on the timing of expected principal reduction on the asset. Excludes CDO securities of $80 million (which was included in the prior (4) quarter), operating real estate held for sale of $10 million and loans subject to call option with a face amount of $406million.
Commercial Assets
The Company owns $3.2 billion of commercial assets (with a basis of $1.8 billion), which includes CMBS, mezzanine loans, B-Notes and whole loans.
-- During the quarter, the Company purchased $125 million, sold $82 million, had principal repayments of $79 million and had $0.4 million of actual principal write-downs. The Company purchased 11 CMBS assets with an average rating of "BBB" and one whole loan. -- The Company had no commercial assets upgraded, seven securities or $34 million affirmed and 34 securities or $296 million downgraded (from an average rating of B+ to CCC+).
CMBS portfolio ($ in thousands):
Average % of Weighted Face Basis Total Delinquency Principal Average Minimum Vintage Rating Number Amount $ Amount $ Basis 60+/FC/REO Subordination Life (1) (2) (3) (4) (yrs)(5) Pre 2004 BBB 86 433,623 400,710 29.8% 7.0% 13.0% 2.5 2004 BB 63 437,986 270,437 20.1% 3.3% 5.7% 2.9 2005 BB 36 351,783 155,254 11.5% 5.2% 8.3% 2.8 2006 BB+ 53 506,181 350,407 26.1% 3.6% 11.0% 3.1 Post B+ 34 362,068 168,394 12.5% 6.2% 12.8% 3.2 2007 TOTAL/WA BB 272 2,091,641 1,345,202 100.0% 5.0% 10.2% 2.9 (1) The year in which the securities were issued. Ratings provided above were determined by third party rating agencies as of a particular date, which may not be current and are subject to change (including a (2) "negative watch" assignment) at any time. The Company had approximately $233 million of CMBS assets that are on negative watch for possible downgrade by at least one rating agency as of June 30, 2010. (3) The percentage of underlying loans that are 60+ days delinquent, or in foreclosure or considered real estate owned (REO). (4) The percentage of the outstanding face amount of securities that is subordinate to the Company's investments. (5) Weighted average life is based on the timing of expected principal reduction on the asset.
Mezzanine loans, B-Notes and whole loans portfolio ($ in thousands):
Face Basis % of WA First WA Last $ Total $ Asset Number Amount Amount Basis Loan to Loan to Delinquency Type ($) ($) Value(1) Value(1) (%)(2) Mezzanine 20 716,286 313,879 64.2% 56.1% 71.1% 18.5% Loans B-Notes 10 283,830 125,092 25.6% 61.9% 76.6% 46.7% Whole 4 85,110 50,043 10.2% 0.0% 83.7% 0.0% Loans Total/WA 34 1,085,226 489,014 100.0% 53.2% 73.5% 24.4% (1) Loan To Value is based on the appraised value at the time of purchase. The percentage of underlying loans that are non-performing, in (2) foreclosure, under bankruptcy filing or considered real estate owned.
Residential Assets
The Company owns $934 million of residential assets (with a basis of $623 million), which includes manufactured housing ("MH") loans, residential loans, subprime securities and FNMA/FHLMC securities.
-- During the quarter, the Company had principal repayments of $27 million, actual principal write-downs of $24 million, purchased $18 million and sold $9 million of residential assets. The Company purchased two ABS assets with an average rating of "BBB." -- The Company had no ABS securities upgraded, three securities or $14 million affirmed, and 46 securities or $183 million downgraded (from an average rating of B to CCC-).
Manufactured housing and residential loan portfolios ($ in thousands):
% of Average Face Basis Total Loan Age Original Delinquency Cumulative Deal Amount Amount Basis (months) Balance $ 90+/FC/REO Loss to $ $ (1) Date MH Loans 161,020 130,466 33.7% 105 327,855 1.2% 6.2% Portfolio 1 MH Loans 227,197 206,087 53.3% 135 434,743 1.0% 4.3% Portfolio 2 Residential Loans 62,480 46,808 12.1% 85 646,357 9.1% 0.3% Portfolio 1 Residential Loans 3,795 3,612 0.9% 68 83,950 0.0% 0.0% Portfolio 2 TOTAL/WA 454,492 386,973 100.0% 117 1,492,905 2.1% 4.4% (1) The percentage of loans that are 90+ days delinquent, or in foreclosure or considered real estate owned (REO).
Subprime Securities portfolio ($ in thousands):
Security Characteristics:
Average % of Minimum Face Basis Total Principal Excess Vintage Rating Number Amount $ Amount $ Basis Subordination Spread(4) (1) (2) (3) 2003 B 15 20,643 12,198 7.0% 21.9% 3.9% 2004 B 28 88,584 33,479 19.3% 16.9% 4.0% 2005 B 26 101,574 31,022 17.9% 27.4% 4.5% 2006 CCC+ 11 99,905 47,764 27.5% 20.9% 4.8% Post B+ 9 84,381 49,080 28.3% 17.2% 3.4% 2007 TOTAL/WA B- 89 395,087 173,543 100.0% 20.9% 4.2%
Collateral Characteristics:
Average Loan Age Collateral 3 Month Delinquency Cumulative Vintage(1) (months) Factor(5) CPR(6) 90+/FC/REO(7) Loss to Date 2003 88 0.10 8.4% 17.6% 3.0% 2004 75 0.14 9.2% 19.8% 3.3% 2005 62 0.21 11.1% 33.5% 8.1% 2006 50 0.42 11.2% 36.0% 14.1% Post 2007 36 0.50 8.8% 24.0% 11.2% TOTAL/WA 58 0.31 10.1% 28.2% 8.9%
Real Estate ABS portfolios ($ in thousands):
Security Characteristics:
Average % of Minimum Face Basis Total Principal Excess Asset Type Rating Number Amount $ Amount $ Basis Subordination Spread (2) (3) (4) Manufactured BBB+ 9 49,345 47,961 82.3% 37.6% 1.6% Housing Small Business CCC+ 13 31,218 10,293 17.7% 15.3% 3.0% Loans TOTAL/WA BB 22 80,563 58,254 100.0% 29.0% 2.1%
Collateral Characteristics:
Average Loan Age Collateral 3 Month Delinquency Cumulative Asset Type (months) Factor(5) CPR(6) 90+/FC/REO(7) Loss to Date Manufactured Housing 115 0.36 8.5% 3.2% 10.6% Small Business Loans 69 0.57 7.2% 26.6% 5.6% TOTAL/WA 97 0.44 8.0% 12.3% 8.6%
(1) The year in which the securities were issued. Ratings provided above were determined by third party rating agencies as of a particular date, may not be current and are subject to change (including (2) a "negative watch" assignment) at any time. The Company had approximately $171 million of subprime and ABS securities that are on negative watch for possible downgrade by at least one rating agency as of June 30, 2010. (3) The percentage of the outstanding face amount of securities and residual interests that is subordinate to the Company's investments. The annualized amount of interest received on the underlying loans in (4) excess of the interest paid on the securities, as a percentage of the outstanding collateral balance. (5) The ratio of original unpaid principal balance of loans still outstanding. (6) Three month average constant prepayment rate. (7) The percentage of underlying loans that are 90+ days delinquent, or in foreclosure or considered real estate owned (REO).
Corporate Assets
The Company owns $696 million of corporate assets (with a basis of $595 million), including REIT debt and corporate bank loans.
-- During the quarter, the Company purchased $105 million, had principal repayments of $71 million, actual principal write-downs of $22 million and sold $5 million. The Company purchased one bank loan asset and sold one REIT asset. -- The Company had no corporate assets upgraded, affirmed or downgraded.
REIT debt portfolio ($ in thousands):
Average Face Basis % of Total Minimum Industry Rating(1) Number Amount $ Amount $ Basis Retail BBB+ 11 80,660 76,901 19.8% Diversified CCC 10 101,836 102,644 26.4% Office BBB 11 115,469 117,215 30.1% Multifamily BBB 3 12,765 12,830 3.3% Hotel BBB 4 30,220 30,683 7.9% Healthcare BBB- 5 41,600 41,706 10.7% Storage A- 1 5,000 5,063 1.3% Industrial BB- 1 2,000 2,073 0.5% TOTAL/WA BB+ 46 389,550 389,115 100.0%
Corporate bank loan portfolio ($ in thousands):
Average % of Minimum Face Basis Total Industry Rating(1) Number Amount $ Amount $ Basis Real Estate C 3 42,087 40,591 19.7% Media CC 2 111,764 46,427 22.6% Resorts NR 1 107,903 77,903 37.9% Restaurant B 2 18,160 15,335 7.5% Transportation NR 1 26,995 25,375 12.3% TOTAL/WA C 9 306,909 205,631 100.0%
Ratings provided above were determined by third party rating agencies as of a particular date, may not be current and are subject to change (including (1) a "negative watch" assignment) at any time. The Company had approximately $2 million of REIT assets that are on negative watch for possible downgrade by at least one rating agency as of June 30, 2010.
Conference Call
Newcastle's management will conduct a live conference call tomorrow, August 6, 2010, at 8:30 A.M. Eastern Time to review the financial results for the quarter ended June 30, 2010. All interested parties are welcome to participate on the live call. You can access the conference call by dialing (888) 243-2046 (from within the U.S.) or (706) 679-1533 (from outside of the U.S.) ten minutes prior to the scheduled start of the call; please reference "Newcastle Second Quarter Earnings Call."
A simultaneous webcast of the conference call will be available to the public on a listen-only basis at www.newcastleinv.com. Please allow extra time prior to the call to visit the site and download the necessary software required to listen to the internet broadcast.
A telephonic replay of the conference call will also be available until 11:59 P.M. Eastern Time on Friday, August 13, 2010 by dialing (800) 642-1687 (from within the U.S.) or (706) 645-9291 (from outside of the U.S.); please reference access code "89368391."
About Newcastle
Newcastle Investment Corp. owns and manages a portfolio of diversified, credit sensitive real estate debt that is primarily financed with match funded debt. Newcastle is organized and conducts its operations to qualify as a real estate investment trust (REIT) for federal income tax purposes. Newcastle is managed by an affiliate of Fortress Investment Group LLC, a global investment management firm. For more information regarding Newcastle Investment Corp. or to be added to our e-mail distribution list, please visit www.newcastleinv.com.
Forward-Looking Statements
Certain items in this press release may constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, including, but not limited to, statements relating to our liquidity, future losses and impairment charges, our ability to acquire assets with attractive returns and the delinquent and loss rates on our subprime portfolios. These statements are based on management's current expectations and beliefs and are subject to a number of trends and uncertainties that could cause actual results to differ materially from those described in the forward-looking statements, many of which are beyond our control. Newcastle can give no assurance that its expectations will be attained. Factors that could cause actual results to differ materially from Newcastle's expectations include, but are not limited to, the risk that the ongoing challenging credit and liquidity conditions continue to cause downgrades of a significant number of our securities and recording of additional impairment charges or reductions in shareholders' equity; the risk that we can find additional suitably priced investments; the risk that investments made or committed to be made cannot be financed on the basis and for the term at which we expect; the relationship between yields on assets which are paid off and yields on assets in which such monies can be reinvested; and the relative spreads between the yield on the assets we invest in and the cost and availability of debt and equity financing. Accordingly, you should not place undue reliance on any forward-looking statements contained in this press release. For a discussion of some of the risks and important factors that could affect such forward-looking statements, see the sections entitled "Risk Factors" and "Management's Discussion and Analysis of Financial Condition and Results of Operation" in the Company's Quarterly Report on Form 10-Q, which is available on the Company's website (www.newcastleinv.com). In addition, new risks and uncertainties emerge from time to time, and it is not possible for the Company to predict or assess the impact of every factor that may cause its actual results to differ from those contained in any forward-looking statements. Such forward-looking statements speak only as of the date of this press release. Newcastle expressly disclaims any obligation to release publicly any updates or revisions to any forward-looking statements contained herein to reflect any change in the Company's expectations with regard thereto or change in events, conditions or circumstances on which any statement is based.
Newcastle Investment Corp. Consolidated Statements of Operations (Unaudited) (dollars in thousands, except per share data) Three Months Ended June 30, Six Months Ended June 30, 2010 2009 2010 2009 Interest income $ 74,183 $ 87,338 $ 144,275 $ 211,811 Interest expense 43,141 54,172 88,730 114,716 Net interest income 31,042 33,166 55,545 97,095 Impairment Valuation allowance (91,534 ) (30,869 ) (187,308 ) 90,019 (reversal) on loans Other-than-temporary impairment on 33,925 209,554 98,781 396,136 securities Portion of other-than-temporary impairment on securities recognized in other 15,114 (55,278 ) (22,000 ) (55,278 ) comprehensive income (loss), net of the reversal of other comprehensive losses into net income (loss) (42,495 ) 123,407 (110,527 ) 430,877 Net interest income (loss) after 73,537 (90,241 ) 166,072 (333,782 ) impairment Other Income (Loss) Gain on settlement 8,954 17,544 18,631 9,497 of investments, net Gain on extinguishment of 46,728 26,830 95,074 53,675 debt Other income (loss), (2,298 ) 10,911 (3,778 ) 4,430 net 53,384 55,285 109,927 67,602 Expenses Loan and security 1,322 1,370 2,357 2,772 servicing expense General and administrative 1,938 2,965 4,976 4,591 expense Management fee to 4,258 4,492 8,735 8,983 affiliate Depreciation and 62 73 125 145 amortization 7,580 8,900 16,193 16,491 Income (loss) from 119,341 (43,856 ) 259,806 (282,671 ) continuing operations Income (loss) from discontinued 13 (142 ) (27 ) (175 ) operations Net Income (Loss) 119,354 (43,998 ) 259,779 (282,846 ) Preferred dividends (1,395 ) (3,376 ) (4,663 ) (6,751 ) Excess of carrying amount of exchanged preferred stock - - 43,043 - over fair value of consideration paid Income (Loss) Applicable to Common $ 117,959 $ (47,374 ) $ 298,159 $ (289,597 ) Stockholders Income (loss) Per Share of Common Stock Basic $ 1.90 $ (0.90 ) $ 5.16 $ (5.48 ) Diluted $ 1.90 $ (0.90 ) $ 5.16 $ (5.48 ) Income (loss) from continuing operations per share of common stock, after preferred dividends and excess of carrying amount of exchanged preferred stock over fair value of consideration paid Basic $ 1.90 $ (0.90 ) $ 5.16 $ (5.48 ) Diluted $ 1.90 $ (0.90 ) $ 5.16 $ (5.48 ) Income (loss) from discontinued operations per share of common stock Basic $ - $ - $ - $ - Diluted $ - $ - $ - $ - Weighted Average Number of Shares of Common Stock Outstanding Basic 62,010,570 52,836,208 57,838,286 52,821,800 Diluted 62,010,570 52,836,208 57,838,286 52,821,800 Dividends Declared per Share of Common $ - $ - $ - $ - Stock
Newcastle Investment Corp. Consolidated Balance Sheets (dollars in thousands, except share data) June 30, 2010 (Unaudited) December 31, 2009 Assets Non-Recourse VIE Financing Structures Real estate securities, available for sale $ 1,872,612 $ 1,784,487 Real estate related loans, held for sale, 671,657 554,367 net Residential mortgage loans, held for 131,084 - investment, net Residential mortgage loans, held for sale, 258,373 380,123 net Subprime mortgage loans subject to call 403,383 403,006 option Restricted cash 145,366 200,251 Receivables from brokers, dealers and - 1,795 clearing organizations Receivables and other assets 32,769 34,848 3,515,244 3,358,877 Recourse Financing Structures and Unlevered Assets Real estate securities, available for sale 3,467 46,308 Real estate related loans, held for sale, 23,001 19,495 net Residential mortgage loans, held for sale, 4,182 3,524 net Operating real estate, held for sale 9,906 9,966 Cash and cash equivalents 37,684 68,300 Receivables and other assets 1,016 8,158 79,256 155,751 $ 3,594,500 $ 3,514,628 Liabilities and Stockholders' Equity (Deficit) Liabilities Non-Recourse VIE Financing Structures CDO bonds payable $ 3,481,618 $ 4,058,928 Other bonds payable 275,933 303,697 Notes payable 4,582 - Financing of subprime mortgage loans subject 403,383 403,006 to call option Derivative liabilities 203,274 203,054 Accrued expenses and other liabilities 7,415 2,992 4,376,205 4,971,677 Recourse Financing Structures and Other Liabilities Repurchase agreements - 71,309 Junior subordinated notes payable 51,256 103,264 Derivative liabilities - 4,100 Due to affiliates 1,419 1,497 Accrued expenses and other liabilities 3,086 3,433 55,761 183,603 4,431,966 5,155,280 Stockholders' Equity (Deficit) Preferred stock, $0.01 par value, 100,000,000 shares authorized, 1,347,321 and 2,500,000 shares of 9.75% Series B Cumulative Redeemable Preferred Stock 496,000 and 1,600,000 shares of 8.05% Series C Cumulative Redeemable Preferred Stock, and 620,000 and 2,000,000 shares of 8.375% Series D Cumulative Redeemable Preferred Stock liquidation preference $25.00 per share, issued and outstanding as of June 30, 2010 and December 31, 2009, respectively 61,583 152,500 Common stock, $0.01 par value, 500,000,000 shares authorized, 62,024,945 and 52,912,513 shares issued and outstanding at June 30, 2010 and December 31, 2009, respectively 620 529 Additional paid-in capital 1,065,362 1,033,520 Accumulated deficit (1,690,870 ) (2,193,383 ) Accumulated other comprehensive income (274,161 ) (633,818 ) (loss) (837,466 ) (1,640,652 ) $ 3,594,500 $ 3,514,628
Newcastle Investment Corp. Reconciliation of Net Interest Income Less Expenses (Net of Preferred Dividends) (dollars in thousands) (Unaudited) Three Months Ended Six Months Ended June 30, 2010 June 30, 2009 June 30, 2010 June 30, 2009 Income (Loss) Applicable to Common $ 117,959 $ (47,374 ) $ 298,159 $ (289,597 ) Stockholders Add (Deduct): Impairment (42,495 ) 123,407 (110,527 ) 430,877 Other (Income) Loss (53,384 ) (55,285 ) (109,927 ) (67,602 ) Excess of carrying amount of exchanged preferred stock over - - (43,043 ) - fair value of consideration paid Loss from discontinued (13 ) 142 27 175 operations Net Interest Income less Expenses (Net $ 22,067 $ 20,890 $ 34,689 $ 73,853 of Preferred Dividends)
Source: Newcastle Investment Corp.
Released August 5, 2010