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NEW YORK, NEW YORK, Aug 10, 2009 (MARKETWIRE via COMTEX News Network) -- Crystal River's management will host a dial-in teleconference to review its second quarter 2009 financial results on August 11, 2009 at 4:30 p.m. (EDT). The teleconference can be accessed by dialing 877-419-6598 or 719-325-4890 (International). A replay of the recorded teleconference will be available through August 25, 2009. The replay can be accessed by dialing 888-203-1112 or 719-457-0820 (International) and entering passcode 4562246. A live audio webcast of the call will be accessible on the Company's website, www.crystalriverreit.com, via a link from the Investor Relations section. A replay of the audio webcast will be archived in the Investor Relations section of the Company's website.
Crystal River Capital, Inc. ("Crystal River" or the "Company") (OTCBB: CYRV) today announced its results for the quarter ended June 30, 2009.
For additional information, please refer to Crystal River's letter to stockholders, which has been posted to the Investor Relations section of the Company's website at www.crystalriverreit.com.
I. SECOND QUARTER UPDATE
- Operating results: The net loss for the quarter ended June 30, 2009 totaled $6.5 million, or $0.26 per share, compared to a net loss of $75.5 million, or $3.04 per share, for the second quarter of 2008 and a net loss of $10.0 million, or $0.40 per share, for the first quarter of 2009. The decrease in the net loss from the first quarter was primarily attributable to a lower loan loss allowance on the real estate loans and net mark-to-market loss on the assets and liabilities valued under fair value option that were recorded in the first quarter and an increase in realized and unrealized gain on derivatives in the second quarter.
- Liquidity and leverage update: The amount drawn under the Company's revolving credit facility remained unchanged as of June 30, 2009 from March 31, 2009 at $28.9 million.
Dividend Information
Crystal River announced that its Board of Directors declared a cash distribution for the quarter ended September 30, 2009 of $0.10 per share of common stock. The cash distribution will be paid on October 30, 2009 to stockholders of record as of the close of business on September 30, 2009.
In order to comply with the REIT provisions of the Internal Revenue Code, the Company generally intends to distribute each year substantially all of its taxable income (which does not necessarily equal net income as calculated in accordance with GAAP) to its stockholders. If necessary for REIT qualification purposes, the Company may need to distribute any taxable income remaining after the distribution of any final regular quarterly dividend each year, together with the first regular quarterly dividend payment of the following taxable year or, at the Company's discretion, in a special dividend distributed prior thereto. The dividend policy is subject to revision at the discretion of the Board of Directors. All distributions will be made at the discretion of the Board of Directors and will depend on a number of factors, including, but not limited to, operating results, taxable income and REIT qualification requirements, available tax losses, economic conditions, capital requirements, liquidity, retention of capital and the credit performance of the Company's investment portfolio. Given the variability of these considerations, the Board of Directors will continually reevaluate these factors when determining future dividends.
About Crystal River
Crystal River Capital, Inc. (OTCBB: CYRV) is a specialty finance REIT. The Company invests in commercial real estate, real estate loans, and real estate--related securities, such as commercial and residential mortgage-backed securities. For more information, visit www.crystalriverreit.com.
II. CONSOLIDATED FINANCIAL STATEMENTS
Condensed Consolidated Balance Sheets (Unaudited)
----------------------------------------------------------------------------
(in thousands, except share and June March December
per share data) 30, 2009 31, 2009 31, 2008
----------------------------------------------------------------------------
ASSETS
Investment securities, at fair value:
Available-for-sale securities $ 14,540 $ 16,103 $ 21,615
Held-for-trading securities 42,713 37,459 51,301
Real estate loans 2,517 2,514 9,034
Real estate loans held for sale 5,058 5,058 5,058
Commercial real estate, net 225,006 226,632 228,259
Other investments 1,550 1,550 1,550
Intangible assets 72,724 74,132 75,541
Cash and cash equivalents 1,930 1,499 6,239
Restricted cash 17,501 25,186 26,107
Receivables 7,733 7,434 7,297
Rent enhancement receivable, related
party 12,620 13,198 13,828
Prepaid expenses and other assets 1,965 296 939
Deferred financing costs, net 1,495 1,514 1,533
---------- ---------- -----------
Total Assets $ 407,352 $ 412,575 $ 448,301
---------- ---------- -----------
---------- ---------- -----------
LIABILITIES AND STOCKHOLDERS' EQUITY
(DEFICIT)
Liabilities
Accounts payable and accrued expenses $ 2,863 $ 3,826 $ 2,652
Dividends payable 2,522 2,511 2,511
Intangible liabilities 69,525 70,895 72,265
Collateralized debt obligations 40,538 35,521 45,429
Junior subordinated notes 51,550 51,550 51,550
Mortgages payable 219,380 219,380 219,380
Secured revolving credit facility,
related party 28,920 28,920 32,920
Interest payable 1,989 2,088 1,357
Derivative liabilities 31,184 47,067 57,646
---------- ---------- -----------
Total Liabilities 448,471 461,758 485,710
---------- ---------- -----------
---------- ---------- -----------
Commitments and Contingencies
Stockholders' Equity (Deficit)
Preferred stock, par value $0.001 per
share, 100,000,000 shares authorized,
no shares issued and outstanding - - -
Common stock, $0.001 par value,
500,000,000 shares authorized,
24,909,254; 24,905,253; and
24,905,252 shares issued and
outstanding, respectively 25 25 25
Additional paid-in capital 564,690 564,615 564,560
Accumulated other comprehensive loss (64,278) (9,152) (9,815)
Accumulated deficit (541,556) (604,671) (592,179)
---------- ---------- -----------
Total Stockholders' Equity (Deficit) (41,119) (49,183) (37,409)
---------- ---------- -----------
Total Liabilities and Stockholders'
Equity (Deficit) $ 407,352 $ 412,575 $ 448,301
---------- ---------- -----------
---------- ---------- -----------
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Condensed Consolidated Statements of Operations (Unaudited)
----------------------------------------------------------------------------
(in thousands, Three months ended Six months ended
except share June March June June June
and per 30, 31, 30, 30, 30,
share data) 2009 2009 2008 2009 2008
----------------------------------------------------------------------------
Revenues
Interest
income -
investment
securities $ 7,096 $ 13,888 $ 24,355 $ 20,984 $ 64,292
Interest
income -
real
estate
loans 228 458 2,207 686 4,819
Other
interest
and
dividend
income 41 19 218 60 887
---------- ---------- ---------- ---------- -----------
Total
interest
and
dividend
income 7,365 14,365 26,780 21,730 69,998
Rental
income,
net 5,446 5,604 5,550 11,050 11,212
---------- ---------- ---------- ---------- -----------
Total
revenues 12,811 19,969 32,330 32,780 81,210
---------- ---------- ---------- ---------- -----------
Expenses
Interest
expense 6,195 6,533 10,732 12,728 35,000
Management
fees,
related
party - - 418 - 1,085
Profess-
ional fees 361 444 585 805 1,253
Deprec-
iation
and
amortiz-
ation 3,022 3,022 3,022 6,044 6,044
Insurance
expense 483 424 480 907 810 Directors'
fees 86 85 127 171 280
Public
company
expense 167 111 302 278 413
Commercial
real
estate
expenses 382 393 420 775 837
Provision
for loss
on real
estate
loans - 6,758 7,386 6,758 16,449
Other
expenses 82 82 546 164 922
---------- ---------- ---------- ---------- -----------
Total
expenses 10,778 17,852 24,018 28,630 63,093
---------- ---------- ---------- ---------- -----------
Other
Revenues
(Expenses)
Realized
net gain
(loss) on
sale of
invest-
ment
securi-
ties,
real
estate
loans and
other
invest-
ments 69 40 (1,263) 109 (5,048)
Realized
and
unreal-
ized
gain
(loss) on
deriv-
atives 6,496 3,871 5,351 10,367 (38,031)
Total
other-
than-
temporary
impair-
ments
on
available-
for-sale
securities (37,328) (5,784) (18,310) (43,112) (85,464)
Portion
of
other-than
-temporary
impair-
ments
recognized
in OCI 22,979 - - 22,979 -
Net
change in
assets and
liabilities
valued
under fair
value
option 969 (9,876) (69,355) (8,907) (102,203)
Loss from
equity
invest-
ments - - - - (40)
Other (1,708) (349) (270) (2,057) (552)
---------- ---------- ---------- ---------- -----------
Total
other
expenses (8,523) (12,098) (83,847) (20,621) (231,338)
---------- ---------- ---------- ---------- -----------
---------- ---------- ---------- ---------- -----------
Net Loss $ (6,490) $ (9,981) $ (75,535) $ (16,471) $ (213,221)
---------- ---------- ---------- ---------- -----------
---------- ---------- ---------- ---------- -----------
Net loss
per share
- basic
and
diluted $ (0.26) $ (0.40) $ (3.04) $ (0.65) $ (8.60)
---------- ---------- ---------- ---------- -----------
---------- ---------- ---------- ---------- -----------
Weighted
average
shares of
common
stock
outst-
anding:
(1)
Basic
and
diluted 25,189,825 25,131,361 24,807,529 25,160,754 24,778,788
---------- ---------- ---------- ---------- -----------
---------- ---------- ---------- ---------- -----------
Dividends
declared
per share
of
common
stock $ 0.10 $ 0.10 $ 0.30 $ 0.20 $ 0.98
---------- ---------- ---------- ---------- -----------
---------- ---------- ---------- ---------- -----------
----------------------------------------------------------------------------
(1) Including other participating securities.
Net Investment Income (Unaudited)
----------------------------------------------------------------------------
(in thousands,
except share Three months ended Six months ended
and per June 30, March 31, June 30, June 30, June 30,
share data) 2009 2009 2008 2009 2008
----------------------------------------------------------------------------
Total
interest
and
dividend
income $ 7,365 $ 14,365 $ 26,780 $ 21,730 $ 69,998
Rental
income,
net 5,446 5,604 5,550 11,050 11,212
Loss from
equity
investments - - - - (40)
Interest
expense (6,195) (6,533) (10,732) (12,728) (35,000)
------------ ----------- ---------- ----------- -----------
Net
Investment
Income $ 6,616 $ 13,436 $ 21,598 $ 20,052 $ 46,170
------------ ----------- ---------- ----------- -----------
------------ ----------- ---------- ----------- -----------
Net
Investment
Income Per
Share $ 0.26 $ 0.53 $ 0.87 $ 0.80 $ 1.86
------------ ----------- ---------- ----------- -----------
------------ ----------- ---------- ----------- -----------
Weighted
average
shares of
common
stock
outstanding:
Basic and
diluted 25,189,825 25,131,361 24,807,529 25,160,754 24,778,788
------------ ----------- ---------- ----------- -----------
------------ ----------- ---------- ----------- -----------
----------------------------------------------------------------------------
Comprehensive Loss (Unaudited)
----------------------------------------------------------------------------
Three months ended Six months ended
June 30, March 31, June 30, June 30, June 30,
(in thousands) 2009 2009 2008 2009 2008
----------------------------------------------------------------------------
Net Loss $ (6,490) $ (9,981) $ (75,535) $ (16,471) $ (213,221)
Cumulative
effect of the
adoption of new
accounting
principle (72,126) - - (72,126) -
Changes in OCI
- securities
available
for sale 16,699 195 1,784 16,894 (6,199)
Realization of
deferred
unrealized
losses
on cash flow
hedges - - 8,327 - 13,181
Amortization of
net realized
losses on
cash flow
hedges into
interest
expense 301 468 300 769 445
----------------------------------------------------------------------------
Comprehensive
Loss $ (61,616) $ (9,318) $ (65,124) $ (70,934) $ (205,794)
----------------------------------------------------------------------------
SUPPLEMENTAL INFORMATION
Total Investment Portfolio at June 30, 2009
The following table summarizes the Company's investment portfolio at June
30, 2009, March 31, 2009, and June 30, 2008:
----------------------------------------------------------------------------
June 30, 2009 March 31, 2009 June 30, 2008
Carrying Carrying Carrying
($ in millions) Value % Total Value % Total Value % Total
----------------------------------------------------------------------------
Available for sale
securities
CMBS $ 50.3 17.3% $ 44.6 15.4% $ 241.7 40.2%
Prime RMBS 4.8 1.6% 6.1 2.1% 37.8 6.3%
Subprime RMBS 2.2 0.8% 2.9 1.0% 16.3 2.7%
Preferred stock - - 0.0 0.0% 0.0 0.0%
Direct real estate
loans
Construction loans - - - - 16.0 2.7%
Mezzanine loans 5.1(1) 1.7% 5.1(1) 1.8% 26.3 4.4%
Whole loans 2.5 0.9% 2.5 0.9% 29.6 4.9%
Commercial real
estate-owned(2) 225.0 77.2% 226.6 78.2% 231.5 38.5%
Other 1.6 0.5% 1.6 0.6% 1.6 0.3%
----------------------------------------------------------------------------
Total $ 291.5 100.0% $ 289.4 100.0% $ 600.8 100.0%
----------------------------------------------------------------------------
(1) Includes one loan in the amount of $5.1 million held for sale.
(2) Excludes intangible assets.
Second Quarter 2009 Securities Roll-Forward Table
The table below details the impact of purchases and sales, principal paydowns, premium and discount amortization, and market value adjustments on our investment securities during the second quarter of 2009:
-----------------------------------------------------------------------
-----
Subprime Total
(in millions) CMBS Prime RMBS RMBS Portfolio
----------------------------------------------------------------------------
Carrying Value
March 31, 2009 $ 44.6 $ 6.1 $ 2.9 $ 53.6
Principal paydowns - (0.3) (0.1) (0.4)
Principal loss - (1.0) (0.7) (1.7)
Amortization (2.9) (1.2) (0.5) (4.6)
Market value adjustments:
CDO assets 7.4 0.2 0.4 8.0
Non-CDO assets (9.4) (3.7) (1.2) (14.3)
OCI 10.6 4.7 1.4 16.7
----------------------------------------------------------------------------
Carrying Value
June 30, 2009 $ 50.3 $ 4.8 $ 2.2 $ 57.3
----------------------------------------------------------------------------
COMMERCIAL REAL ESTATE ("CRE") INVESTMENT PORTFOLIO
At June 30, 2009, Crystal River's CRE investment portfolio totaled $228.2 million. The CRE portfolio consists of three high-quality office buildings 100% leased on a triple-net basis to JPMorgan Chase. The buildings are financed with long-term fixed-rate mortgage loans.
CRE investment portfolio at June 30, 2009:
----------------------------------------------------------------------------
Year of Book Mortgage Net Book
Lease Total Area Value(1) Debt EquityLocation Tenant Expiry (000s Sq. Ft.) (Millions) (Millions) (Millions)
----------------------------------------------------------------------------
Houston, JPMorgan
Texas Chase 2021 428.6 $ 59.4 $ 53.4 $ 6.0
Arlington, JPMorgan
Texas Chase 2027 171.5 21.2 20.9 0.3
Phoenix, JPMorgan
Arizona Chase 2021 724.0 147.6 145.1 2.5
----------------------------------------------------------------------------
Total CRE 1,324.1 $ 228.2 $ 219.4 $ 8.8
----------------------------------------------------------------------------
(1) Book value includes intangible assets and intangible liabilities, but
excludes rent-enhancement and straight-line rent receivables.
REAL ESTATE LOAN INVESTMENT PORTFOLIO
At June 30, 2009, Crystal River's real estate loan portfolio, which consists of two mezzanine loans (one of which is held for sale), a construction loan and a whole loan, totaled $7.6 million and had a weighted average interest rate of 9.3%.
Real estate loan portfolio at June 30, 2009:
----------------------------------------------------------------------------
Mezzanine Construction
Loans Loans Whole Loans Total/WA(1)
Float- Float- Float- Float-
($ in millions) Fixed ing Fixed ing Fixed ing Fixed ing
----------------------------------------------------------------------------
Outstanding
Face Amount $ 17.4 $ - $ 14.6 $ - $ - $ 2.5 $ 32.0 $ 2.5
Carrying Value 5.1 - - - - 2.5 5.1 2.5
Amortized Cost 17.4 - 14.6 - - 2.5 32.0 2.5
Number of Loans 2 - 1 - - 1 3 1
Number of loans
that are
delinquent 1 - 1 - - - 2 -
WA Fixed Rate 10.1% - 16.0%(3) - - n/a 10.1%(4) n/a
WA Floating
Rate:
Spread over
LIBOR(2) n/a - n/a - - 3.3% n/a 3.3%
----------------------------------------------------------------------------
(1) Weighted Average ("WA").
(2) London Interbank Offered Rate ("LIBOR").
(3) Construction loan has been placed on non-accrual status.
(4) Excludes 16.0% WA fixed rate for construction loan.
CMBS INVESTMENT PORTFOLIO
CMBS portfolio by credit rating at June 30, 2009:
----------------------------------------------------------------------------
Weighted Average
---------------------------
($ in millions) Amortized Cost Carrying Value Yield(1) Term (Yrs)(2)
----------------------------------------------------------------------------
BBB $ 70.4 $ 11.3 51.4% 7.6
BB 41.0 8.2 65.7% 6.3
B 82.5 11.9 95.4% 6.1
Below B 68.4 18.9 147.8% 4.2
----------------------------------------------------------------------------
Total CMBS $ 262.3 $ 50.3 100.3% 5.7
----------------------------------------------------------------------------
(1) Yield is the implied loss-adjusted yield based on our expectation of
future cash flows and the fair value of the security.
(2) Refers to the loss-adjusted weighted average remaining life.
Credit Characteristics of CMBS portfolio by vintage at June 30, 2009:
CDO Assets:
----------------------------------------------------------------------------
Outst- Cumul-
WA Original anding Principal ative
Rating Face Face Carrying Subordin- Delinquency Loss to
Vintage (1) Amount Amount Value ation 60+/FC/REO(2) Date(3)
----------------------------------------------------------------------------
Pre-2005 B $ 2.8 $ 2.8 $ 0.6 3.65% 1.54% 0.00%
2005 B 244.8 244.8 21.2 2.62% 2.88% 0.00%
2006 B- 248.3 248.3 15.4 2.29% 2.95% 0.00%
2007 CCC 27.9 27.9 1.4 2.69% 1.77% 0.00%
----------------------------------------------------------------------------
Total
CMBS B- $ 523.8 $ 523.8 $ 38.6 2.48% 2.85% 0.00%
----------------------------------------------------------------------------
(1) Rounded to nearest rating.
(2) "60+" means that a payment on an underlying collateral loan is more than
60 days past due; "FC" means that the collateral underlying the loan is
under foreclosure; "REO" means that the collateral underlying the loan
has been foreclosed and is owned by the issuing trust. Delinquency rates
refer to the entire securitization.
(3) Actual losses against securities in Crystal River's portfolio, based on
original face amount.
Non-CDO Assets:
----------------------------------------------------------------------------
Outst- Cumul-
Original anding Principal ative
WA Face Face Carrying Subordin- Delinquency Loss to
Vintage Rating Amount Amount Value ation 60+/FC/REO Date
----------------------------------------------------------------------------
2005 CC+ $ 50.8 $ 43.3 $ 2.3 0.21% 1.86% 14.82%
2006 CC+ 119.6 119.6 4.5 0.60% 2.84% 0.00%
2007 CC+ 132.8 132.8 4.9 1.17% 2.11% 0.00%
----------------------------------------------------------------------------
Total
CMBS CC+ $ 303.2 $ 295.7 $ 11.7 0.78% 2.37% 2.48%
----------------------------------------------------------------------------
PRIME RMBS INVESTMENT PORTFOLIO
Prime RMBS portfolio by credit rating at June 30, 2009:
----------------------------------------------------------------------------
Weighted Average
------------------------
($ in millions) Amortized Cost Carrying Value Yield Term (Yrs)
----------------------------------------------------------------------------
BB and above $ 0.8 $ 0.1 261.0% 8.8
B 2.2 0.3 705.9% 7.6
Below B 19.1 4.4 267.0% 4.4
----------------------------------------------------------------------------
Total Prime RMBS $ 22.1 $ 4.8 295.6% 4.7
----------------------------------------------------------------------------
Credit Characteristics of Prime RMBS portfolio by vintage at June 30, 2009:
CDO Assets:
----------------------------------------------------------------------------
Outst- Cumul-
Original anding Principal ative
WA Face Face Carrying Subordin- Delinquency Loss to
Vintage Rating Amount Amount Value ation 60+/FC/REO Date
----------------------------------------------------------------------------
2003 CCC $ 1.9 $ 1.7 $ 0.3 0.25% 0.52% 0.00%
2004 CC+ 18.8 11.7 0.5 0.95% 15.48% 2.45%
2005 CC+ 80.2 64.7 1.9 0.79% 15.45% 2.20%
----------------------------------------------------------------------------
Total
Prime
RMBS CC+ $ 100.9 $ 78.1 $ 2.7 0.80% 15.13% 2.22%
----------------------------------------------------------------------------
Non-CDO Assets:
----------------------------------------------------------------------------
Outst- Cumul-
Original anding Principal ative
WA Face Face Carrying Subordin- Delinquency Loss to
Vintage Rating Amount Amount Value ation 60+/FC/REO Date
----------------------------------------------------------------------------
2003 NR $ 1.9 $ 1.5 $ 0.1 0.00% 0.52% 11.92%
2004 NR 3.0 0.7 - 0.00% 3.60% 72.47%
2005 CC+ 66.3 47.9 1.7 0.44% 9.00% 9.55%
2006 C 4.0 3.8 0.1 0.68% 3.26% 0.00%
2007 C- 17.1 11.5 0.2 0.11% 4.75% 39.38%
----------------------------------------------------------------------------
Total
Prime
RMBS CC+ $ 92.3 $ 65.4 $ 2.1 0.38% 7.67% 11.70%
----------------------------------------------------------------------------
SUBPRIME RMBS INVESTMENT PORTFOLIO
Subprime RMBS portfolio by credit rating at June 30, 2009:
----------------------------------------------------------------------------
Weighted Average
------------------------
($ in millions) Amortized Cost Carrying Value Yield Term (Yrs)
----------------------------------------------------------------------------
BBB $ 2.6 $ 0.7 70.9% 5.0
BB 0.2 0.3 (61.4)% 1.0
B 2.1 0.1 133.2% 18.3
Below B 4.6 1.1 601.8% 3.3----------------------------------------------------------------------------
Total Subprime RMBS $ 9.5 $ 2.2 307.5% 4.1
----------------------------------------------------------------------------
Credit Characteristics of Subprime RMBS portfolio by vintage at June 30,
2009:
CDO Assets:
----------------------------------------------------------------------------
Outst- Cumul-
Original anding Principal ative
WA Face Face Carrying Subordin- Delinquency Loss to
Vintage Rating Amount Amount Value ation 60+/FC/REO Date
----------------------------------------------------------------------------
2005 CC+ $ 67.1 $ 42.5 $ 0.9 5.64% 33.37% 25.75%
----------------------------------------------------------------------------
Total
Subprime
RMBS CC+ $ 67.1 $ 42.5 $ 0.9 5.64% 33.37% 25.75%
----------------------------------------------------------------------------
Non-CDO Assets:
----------------------------------------------------------------------------
Outst- Cumul-
Original anding Principal ative
WA Face Face Carrying Subordin- Delinquency Loss to
Vintage Rating Amount Amount Value ation 60+/FC/REO Date
----------------------------------------------------------------------------
2005 BB+ $ 19.5 $ 6.9 $ 0.4 0.69% 31.15% 24.27%
2006 B+ 13.2 8.9 0.5 4.32% 23.37% 39.32%
2007 C 9.1 9.1 0.4 1.16% 30.61% 0.00%
----------------------------------------------------------------------------
Total
Subprime
RMBS CCC $ 41.8 $ 24.9 $ 1.3 2.17% 28.16% 23.19%
----------------------------------------------------------------------------
Financing Details
The following table shows the Company's investment securities, real estate loans, other investments and other assets as of June 30, 2009 and the different lines used to finance such assets, categorized by (i) CDO debt, (ii) other term debt, such as mortgage loans on commercial real estate and trust preferred securities and (iii) the Company's secured revolving credit facility:
-----------------------------------------------------------------------
-----
Assets Debt
----------------------------------------------------------------------------
CDO Other Term Funding
($ in millions) Carrying Value Debt(1) Debt Facility
----------------------------------------------------------------------------
CMBS $ 50.3 $ 37.2 $ - $ 3.2
Prime RMBS 4.8 2.5 - -
Subprime RMBS 2.2 0.8 - -
Real estate loans 7.6 - - 6.1
Commercial real estate 225.0 - 219.4 19.6
Trust Preferred
Securities 1.6 - 51.6 -
Other 115.9 - - -
----------------------------------------------------------------------------
Total $ 407.4 $ 40.5 $ 271.0 $ 28.9
----------------------------------------------------------------------------
(1) CDO debt has been allocated based upon the asset mix within the
Company's CDOs.
CDO and Non-CDO Assets
The table below summarizes the breakdown of our investment securities between assets held by non-recourse securitization subsidiaries financed by CDO debt and assets held directly at June 30, 2009:
-----------------------------------------------------------------------
-----
Consolidated
($ in millions) Carrying Value CDO Assets Non-CDO Assets
----------------------------------------------------------------------------
CMBS $ 50.3 $ 38.6 $ 11.7
Prime RMBS 4.8 2.7 2.1
Subprime RMBS 2.2 0.9 1.3
----------------------------------------------------------------------------
Total $ 57.3 $ 42.2 $ 15.1
----------------------------------------------------------------------------
Our securitized assets are held by two non-recourse securitization subsidiaries financed by CDO debt. The table below details the assets and liabilities of these securitizations at June 30, 2009:
-----------------------------------------------------------------------
-----
Consolidated
Outstanding Consolidated
($ in millions) Face Amount Carrying Value CDO I CDO II
----------------------------------------------------------------------------
CMBS $ 819.5 $ 38.6 $ 9.3 $ 29.3
Prime RMBS 143.5 2.7 2.7 -
Subprime RMBS 67.4 0.9 0.9 -
Receivables, cash
and other assets - 4.3 1.6 2.7
Collateralized debt
obligations (459.6) (40.5) (12.0) (28.5)
Derivative and other
liabilities, net - (21.6) (3.5) (18.1)
----------------------------------------------------------------------------
Net Equity $ 570.8 $ (15.6) $ (1.0) $ (14.6)
----------------------------------------------------------------------------
OTHER INFORMATION
The Company will file a Form 10-Q for the quarter ended June 30, 2009 with the Securities and Exchange Commission. Please read the Form 10-Q carefully as it will contain Crystal River's consolidated financial statements and notes thereto and Management's Discussion and Analysis of Financial Condition and Results of Operations. The Form 10-Q also will be made available under the Investor Relations section of Crystal River's website at www.crystalriverreit.com.
Definition of Net Investment Income
This press release and accompanying financial information make reference to Net Investment Income. The Company considers its Net Investment Income to be total revenues, including income (loss) from equity investments, less interest expense. The Company believes that Net Investment Income provides useful information to investors because it represents the largest component of the Company's Operating Earnings, which management believes is an effective indicator of the Company's profitability and financial performance over time. The Company provides the components of Net Investment Income with the financial statements accompanying this press release. Net Investment Income is a non-GAAP measure that does not have any standard meaning prescribed by GAAP and therefore may not be comparable to similar measures presented by other companies.
Forward-Looking Information
This news release, and our public documents to which we refer, contain or incorporate by reference certain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, including statements relating to our future financial results and future dividend payments. Forward-looking statements that are based on various assumptions (some of which are beyond our control) may be identified by reference to a future period or periods or by the use of forward-looking terminology, such as "may," "will," "believe," "expect," "anticipate," "continue," "should," "intend," or similar terms or variations on those terms or the negative of those terms. Although we believe that the expectations contained in any forward-looking statement are based on reasonable assumptions, we can give no assurance that our expectations will be attained. Factors that could cause actual results to differ materially from those set forth in the forward-looking statements include, but are not limited to, changes in interest rates, changes in the yield curve, changes in prepayment rates, the effectiveness of our hedging strategies, the availability of mortgage-backed securities and other targeted investments for purchase and origination, the availability and cost of capital for financing future investments and, if available, the terms of any such financing, changes in the market value of our assets, future margin reductions and the availability of liquid assets to post additional collateral, changes in business conditions and the general economy, competition within the specialty finance sector, changes in government regulations affecting our business, our ability to maintain our qualification as a real estate investment trust for federal income tax purposes, and other risks disclosed from time to time in our filings with the Securities and Exchange Commission. For more information on the risks facing the Company, see the risk factors in Exhibit 99.1 to our Form 10-Q/A for the period ended March 31, 2009, which we filed with the SEC on June 5, 2009, and the risk factors in Exhibit 99.1 to our Form 10-Q for the period ended June 30, 2009, which we expect to file with the SEC on August 10, 2009. We do not undertake, and specifically disclaim any obligation, to publicly release any update or supplement to any forward-looking statements to reflect the occurrence of anticipated or unanticipated events or circumstances after the date of such statements.
Contacts: Crystal River Capital, Inc. Jody Sheu (212) 549-8346 jsheu@crystalriverreit.com www.crystalriverreit.com (CRZ-F)
SOURCE: Crystal River Capital, Inc.
mailto:jsheu@crystalriverreit.com http://www.crystalriverreit.com
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