KKR Real Estate Finance Trust (NYSE:KREF) shares gapped up as much as 4.1% in Monday after-hours trading after mortgage REIT turned in earnings for Q3 that topped the average analyst estimate but fell sequentially and from a year ago.
Q3 distributable EPS of $0.25, surpassing the $0.11 average analyst estimate, retreated from $0.48 in Q2 and from $0.50 in the year-earlier period.
Net interest income totaled $44.6M for the three months ended Sept. 30, 2023, up slightly from $44.0M for the quarter ended June 30, 2023, and down from $47.3M for the quarter ended Sept. 30, 2022.
Total operating expenses fell to $23.1M from $70.9M in Q2 and from $94.1M in Q3 of last year. The drop was mostly due to a significant decrease in provision for credit losses, which now stands at $8.81M (vs. $56.3M in Q2 and $80.6M in Q3 2022).
During the quarter, KKR Real Estate (KREF) collected 96.0% of interest payments due on its loan portfolio. As of Sept. 30, 2023, the average risk rating of the company’s portfolio was 3.2, weighted by outstanding principal amount, consistent with that as of June 30, 2023.
Conference call on October 24 at 10:00 a.m. ET.