Caliber (NASDAQ: CWD; “CaliberCos Inc.”), a real estate
investor, developer, and asset manager, today reported results for
the second quarter ended on June 30, 2024.
As previously communicated, Caliber has simplified the
presentation of its financial statements through the
deconsolidation of certain entities’ assets, liabilities, revenues,
and expenses from the Company’s financials. Caliber’s GAAP
financial metrics are impacted by the timing of deconsolidation. As
such, periods presented may not be comparable due to the
deconsolidation of certain entities.
Second Quarter 2024 Financial Highlights (compared to second
quarter 2023)
- Total revenue of $8.2 million, a 60.0% decrease, reflecting the
deconsolidation of Caliber Hospitality, LP and the Caliber
Hospitality Trust (“CHT”) in March 2024. Caliber estimates total
revenue would have increased had the deconsolidated asset results
not been included in the Q2 2023 comparison period.
- Platform revenue of $4.2 million, a 24.9% increase
- Asset management revenue of $4.2 million driving the stated
results
- No significant performance allocations were earned
- Net loss attributable to Caliber of $4.7 million, or $0.22 per
diluted share, compared to net loss attributable to Caliber of $5.7
million or $0.29 per diluted share
- Caliber Adjusted EBITDA loss of $2.5 million, compared to
Caliber Adjusted EBITDA loss of $2.3 million
- Fair value assets under management (“FV AUM”) of $773.2
million, a 4.3% increase compared to December 31, 2023, primarily
due to the acquisition of our West Ridge property in Colorado, net
market appreciation, and construction activity, partially offset by
land parcel sales at Johnstown and the sale of a self-storage
property
- Managed capital of $469.8 million, a 7.4% increase compared to
December 31, 2023, with originations of $38.0 million, partially
offset by redemptions of $5.9 million
Management Commentary
“Our second quarter performance was in line with our
expectations, with asset management revenue up nearly 25%
year-over-year,” said Chris Loeffler, CEO of Caliber. “We are on
track to achieve the $6.5 million in annualized cost savings from
our recent cost reduction initiatives, with a partial impact
expected in the second half of the year. Caliber remains focused on
our goal of achieving profitability in the short term and we expect
to generate positive adjusted EBITDA by the fourth quarter of 2024
and positive net profit for the full year 2025.”
“As we continue to sharpen our focus on increasing revenue,
Caliber has set three priorities for top-line growth. Our first
priority is to acquire more income-producing real estate
investments with a target to close on the first $1 billion of
assets in our planned roll-up of the Caliber Hospitality Trust, or
CHT.”
“Our second priority to accelerate revenue growth is to provide
more single-asset investment offerings and our third priority is to
develop projects in our pipeline related to existing Caliber
properties, which we expect will drive the best results for our
stakeholders.”
Business Update
The following are key milestones completed both during and
subsequent to the second quarter ended June 30, 2024.
- On April 29, 2024, Caliber announced the sale of Areas B and C
of The Ridge development, each approximately 20-acre parcels of
land in Johnstown, Colo., for an aggregate $12.3 million.
- On May 1, 2024, Caliber closed on the capitalization of Phase 1
of the Company’s SP10 project, which includes the conversion of an
existing hotel to apartments along with the development of new town
homes surrounding the site, producing 188 units in total.
Demolition is nearly complete, and construction is expected to
begin in the third quarter 2024.
- On May 7, 2024, Caliber announced the sale of an approximately
50-acre parcel of land in Johnstown, Colo., to the Archdiocese of
Denver for $7.7 million.
- In May 2024, CHT received a $10 million investment into its
Series D preferred equity. This investment nearly doubles the
current total of preferred equity invested into CHT and will help
advance the business plans of Caliber and CHT.
- On June 25, 2024, Caliber completed construction on Jordan’s
Lofts, a 48-unit Class A multifamily property in Downtown Bryan,
Texas. 96% of the residential units are leased and the building
also features 6,500 square feet of retail space on the ground
floor, which is seeking tenants.
- As of June 30, 2024, Caliber was actively developing 1,940
multifamily units, 1,942 single family units, 2.6 million square
feet of commercial and industrial, and 0.8 million square feet of
office and retail.
Conference Call Information
Caliber will host a conference call today, Monday, August 12,
2024, at 5:00 p.m. Eastern Time (ET) to discuss its second quarter
2024 financial results and business outlook. To access this call,
dial 1-800-717-1738 (domestic) or 1-646-307-1865 (international). A
live webcast of the conference call will be available via the
investor relations section of Caliber’s website under “Financial
Results.” The webcast replay of the conference call will be
available on Caliber’s website shortly after the call
concludes.
About Caliber (CaliberCos Inc.) (NASDAQ: CWD)
With more than $2.9 billion of managed assets, including
estimated costs to complete assets under development, Caliber’s
15-year track record of managing and developing real estate is
built on a singular goal: make money in all market conditions. Our
growth is fueled by our performance and our competitive advantage:
we invest in projects, strategies, and geographies that global real
estate institutions do not. Integral to our competitive advantage
is our in-house shared services group, which offers Caliber greater
control over our real estate and visibility to future investment
opportunities. There are multiple ways to participate in Caliber’s
success: invest in Nasdaq-listed CaliberCos Inc. and/or invest
directly in our Private Funds.
Forward Looking Statements
This press release contains “forward-looking statements” that
are subject to substantial risks and uncertainties. All statements,
other than statements of historical fact, contained in this press
release are forward-looking statements. Forward-looking statements
contained in this press release may be identified by the use of
words such as “anticipate,” “believe,” “contemplate,” “could,”
“estimate,” “expect,” “intend,” “seek,” “may,” “might,” “plan,”
“potential,” “predict,” “project,” “target,” “aim,” “should,”
"will” “would,” or the negative of these words or other similar
expressions, although not all forward-looking statements contain
these words. Forward-looking statements are based on the Company’s
current expectations and are subject to inherent uncertainties,
risks and assumptions that are difficult to predict. Further,
certain forward-looking statements are based on assumptions as to
future events that may not prove to be accurate including, but not
limited to, the Company’s ability to adequately grow cumulative
fundraising, AUM and annualized platform revenue to meet 2026
targeted goals, the closing of the transaction with L.T.D.
Hospitality Group LLC and the viability of and ability of the
Company to adequately access the real estate and capital markets.
These and other risks and uncertainties are described more fully in
the section titled “Risk Factors” in the final prospectus related
to the Company’s public offering filed with the SEC and other
reports filed with the SEC thereafter. Forward-looking statements
contained in this announcement are made as of this date, and the
Company undertakes no duty to update such information except as
required under applicable law.
CALIBERCOS INC. AND
SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF
OPERATIONS
(AMOUNTS IN THOUSANDS, EXCEPT PER SHARE
DATA)
Three Months Ended June
30,
2024
2023
(unaudited)
Revenues
Asset management revenues
$
3,226
$
1,894
Performance allocations
16
12
Consolidated funds – hospitality
revenues
2,894
16,273
Consolidated funds – other revenues
2,043
2,266
Total revenues
8,179
20,445
Expenses
Operating costs
5,535
6,820
General and administrative
2,079
1,426
Marketing and advertising
227
325
Depreciation and amortization
144
137
Consolidated funds – hospitality
expenses
3,312
20,749
Consolidated funds – other expenses
1,358
1,949
Total expenses
12,655
31,406
Other income, net
318
546
Interest income
157
96
Interest expense
(1,315
)
(1,261
)
Net loss before income taxes
(5,316
)
(11,580
)
Benefit from income taxes
—
—
Net loss
(5,316
)
(11,580
)
Net loss attributable to noncontrolling
interests
(586
)
(5,854
)
Net loss attributable to CaliberCos
Inc.
(4,730
)
(5,726
)
Basic and diluted net loss per share
attributable to common stockholders
$
(0.22
)
$
(0.29
)
Weighted average common shares
outstanding:
Basic and diluted
21,811
19,612
CALIBERCOS INC. AND
SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE
SHEETS
(AMOUNTS IN THOUSANDS, EXCEPT
FOR SHARE AND PER SHARE DATA)
June 30, 2024
December 31, 2023
(unaudited)
Assets
Cash
$
638
$
940
Restricted cash
2,455
2,569
Real estate investments, net
21,621
21,492
Notes receivable - related parties
778
50
Due from related parties
11,118
9,709
Investments in unconsolidated entities
12,475
3,338
Operating lease - right of use assets
170
193
Prepaid and other assets
2,661
2,781
Assets of consolidated funds
Cash
1,146
2,865
Restricted cash
316
11,266
Real estate investments, net
83,251
185,636
Accounts receivable, net
168
1,978
Notes receivable - related parties
57,194
34,620
Operating lease - right of use assets
—
10,318
Prepaid and other assets
1,248
11,677
Total assets
$
195,239
$
299,432
CALIBERCOS INC. AND
SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE
SHEETS
(AMOUNTS IN THOUSANDS, EXCEPT
FOR SHARE AND PER SHARE DATA)
June 30, 2024
December 31, 2023
Liabilities and Stockholders’
Equity
Notes payable
$
50,169
$
53,799
Accounts payable and accrued expenses
9,707
8,886
Due to related parties
86
257
Operating lease liabilities
106
119
Other liabilities
813
420
Liabilities of consolidated funds
Notes payable, net
36,553
129,684
Notes payable - related parties
—
12,055
Accounts payable and accrued expenses
1,792
11,736
Due to related parties
168
101
Operating lease liabilities
—
13,957
Other liabilities
641
2,400
Total liabilities
100,035
233,414
Commitments and Contingencies
Common stock Class A, $0.001 par value;
100,000,000 shares authorized, 14,628,638 and 13,872,671 shares
issued and outstanding as of June 30, 2024 and December 31, 2023,
respectively
15
14
Common stock Class B, $0.001 par value;
15,000,000 shares authorized, 7,416,414 shares issued and
outstanding as June 30, 2024 and December 31, 2023
7
7
Paid-in capital
40,599
39,432
Accumulated deficit
(45,365
)
(36,830
)
Stockholders’ equity (deficit)
attributable to CaliberCos Inc.
(4,744
)
2,623
Stockholders’ equity attributable to
noncontrolling interests
99,948
63,395
Total stockholders’ equity
95,204
66,018
Total liabilities and stockholders’
equity
$
195,239
$
299,432
Definitions
Assets Under Management
AUM refers to the assets we manage or sponsor. We monitor two
types of information with regard to our AUM:
- Managed Capital – we define this as the total capital we
fundraise from our customers as investments in our funds. It also
includes fundraising into our corporate note program, the proceeds
of which were used, in part, to invest in or loan to our funds. We
use this information to monitor, among other things, the amount of
‘preferred return’ that would be paid at the time of a distribution
and the potential to earn a performance fee over and above the
preferred return at the time of the distribution. Our fund
management fees are based on a percentage of managed capital or a
percentage of assets under management, and monitoring the change
and composition of managed capital provides relevant data points
for Caliber management to further calculate and predict future
earnings.
- Fair Value (“FV”) AUM – we define this is as the aggregate fair
value of the real estate assets we manage and from which we derive
management fees, performance revenues and other fees and expense
reimbursements. We estimate the value of these assets quarterly to
help make sale and hold decisions and to evaluate whether an
existing asset would benefit from refinancing or recapitalization.
This also gives us insight into the value of our carried interest
at any point in time. We also utilize FV AUM to predict the
percentage of our portfolio which may need development services in
a given year, fund management services (such as refinance), and
brokerage services. As we control the decision to hire for these
services, our service income is generally predictable based upon
our current portfolio AUM and our expectations for AUM growth in
the year forecasted.
Non-GAAP Measures
We use non-GAAP financial measures to evaluate operating
performance, identify trends, formulate financial projections, make
strategic decisions, and for other discretionary purposes. We
believe that these measures enhance the understanding of ongoing
operations and comparability of current results to prior periods
and may be useful for investors to analyze our financial
performance because they provides investors a view of the
performance attributable to CaliberCos Inc. When analyzing our
operating performance, investors should use these measures in
addition to, and not as an alternative for, their most directly
comparable financial measure calculated and presented in accordance
with U.S. GAAP. Our presentation of non-GAAP measures may not be
comparable to similarly identified measures of other companies
because not all companies use the same calculations. These measures
may also differ from the amounts calculated under similarly titled
definitions in our debt instruments, which amounts are further
adjusted to reflect certain other cash and non-cash charges and are
used by us to determine compliance with financial covenants therein
and our ability to engage in certain activities, such as incurring
additional debt and making certain restricted payments.
Fee-Related Earnings and Related Components
Fee-Related Earnings is a supplemental non-GAAP performance
measure used to assess our ability to generate profits from
fee-based revenues, focusing on whether our core revenue streams,
are sufficient to cover our core operating expenses. Fee- Related
Earnings represents the Company’s net income (loss) before income
taxes adjusted to exclude depreciation and amortization,
stock-based compensation, interest expense and extraordinary or
non-recurring revenue and expenses, including performance
allocation revenue and gain (loss) on extinguishment of debt,
public registration direct costs related to aborted or delayed
offerings and our Reg A+ offering, the share repurchase costs
related to the Company’s Buyback Program, litigation settlements,
and expenses recorded to earnings relating to investment deals
which were abandoned or closed. Fee-Related Earnings is presented
on a basis that deconsolidates our consolidated funds (intercompany
eliminations) and eliminates noncontrolling interest. Eliminating
the impact of consolidated funds and noncontrolling interest
provides investors a view of the performance attributable to
CaliberCos Inc. and is consistent with performance models and
analysis used by management.
Distributable Earnings
Distributable Earnings is a supplemental non-GAAP performance
measure equal to Fee-Related Earnings plus performance allocation
revenue and less interest expenses and provision for income taxes.
We believe that Distributable Earnings can be useful as a
supplemental performance measure to our GAAP results assessing the
amount of earnings available for distribution.
Caliber Adjusted EBITDA
Caliber Adjusted EBITDA represents the Company’s Distributable
Earnings adjusted for interest expense, the share repurchase costs
related to the Company’s Buyback Program, other income (expense),
and provision for income taxes on a basis that deconsolidates our
consolidated funds (intercompany eliminations), Loss on CRAF
Investment Redemption, Gain on extinguishment of Payroll Protection
Program loans, and eliminates noncontrolling interest. Eliminating
the impact of consolidated funds and noncontrolling interest
provides investors a view of the performance attributable to
CaliberCos Inc. and is consistent with performance models and
analysis used by management.
Consolidated Adjusted EBITDA
Consolidated Adjusted EBITDA represents the Company’s and the
consolidated funds’ earnings before net interest expense, income
taxes, depreciation and amortization, further adjusted to exclude
stock-based compensation, transaction fees, expenses and other
public registration direct costs related to aborted or delayed
offerings and our Reg A+ offering, the share repurchase costs
related to the Company’s Buyback Program, litigation settlements,
expenses recorded to earnings relating to investment deals which
were abandoned or closed, any other non-cash expenses or losses, as
further adjusted for extraordinary or non-recurring items.
NON-GAAP RECONCILIATIONS
(AMOUNTS IN THOUSANDS)
(UNAUDITED)
Three Months Ended June
30,
2024
2023
Net loss attributable to CaliberCos
Inc.
$
(4,730
)
$
(5,726
)
Net income (loss) attributable to
noncontrolling interests
(586
)
(5,854
)
Net loss
(5,316
)
(11,580
)
Provision for income taxes
—
—
Net loss before income taxes
(5,316
)
(11,580
)
Depreciation and amortization
119
137
Consolidated funds' impact on fee-related
earnings
491
5,781
Stock-based compensation
584
1,922
Severance
171
—
Performance allocations
(16
)
(12
)
Other expenses (income), net
(318
)
(546
)
Interest expense, net
1,145
763
Fee-related earnings
(3,140
)
(3,535
)
Performance allocations
16
12
Interest expense, net
(1,145
)
(763
)
Provision for income taxes
—
—
Distributable earnings
(4,269
)
(4,286
)
Interest expense
1,315
1,261
Other expenses (income), net
318
546
Provision for income taxes
—
—
Consolidated funds' impact on Caliber
adjusted EBITDA
185
152
Caliber adjusted EBITDA
(2,451
)
(2,327
)
Consolidated funds' EBITDA adjustments
1,485
1,070
Consolidated adjusted EBITDA
$
(966
)
$
(1,257
)
ASSET MANAGEMENT PLATFORM
SEGMENT(1)
(AMOUNTS IN THOUSANDS)
(UNAUDITED)
Three Months Ended June 30,
2024
Unconsolidated
Impact of Consolidated Fund
and Eliminations
Consolidated
Revenues
Asset management
$
4,179
$
(953
)
$
3,226
Performance allocations
33
(17
)
16
Consolidated funds – hospitality
revenue
—
2,894
2,894
Consolidated funds – other revenue
—
2,043
2,043
Total revenues
4,212
3,967
8,179
Expenses
Operating costs
5,760
(225
)
5,535
General and administrative
2,091
(12
)
2,079
Marketing and advertising
227
—
227
Depreciation and amortization
119
25
144
Consolidated funds – hospitality
expenses
—
3,312
3,312
Consolidated funds – other expenses
—
1,358
1,358
Total expenses
8,197
4,458
12,655
Other income (expenses), net
490
(172
)
318
Interest income
170
(13
)
157
Interest expense
(1,315
)
—
(1,315
)
Net loss before income taxes
$
(4,640
)
$
(676
)
$
(5,316
)
Provision for income taxes
—
—
—
Net loss
(4,640
)
(676
)
(5,316
)
Net loss attributable to noncontrolling
interests
—
(586
)
(586
)
Net loss attributable to CaliberCos
Inc.
$
(4,640
)
$
(90
)
$
(4,730
)
___________________________________________
(1) Represents the results of our asset
management platform segment, which are presented on a basis that
deconsolidates our consolidated funds (intercompany eliminations)
and eliminate noncontrolling interest.
Three Months Ended June 30,
2023
Unconsolidated
Impact of Consolidated Fund
and Eliminations
Consolidated
Revenues
Asset management
$
3,348
$
(1,454
)
$
1,894
Performance allocations
24
(12
)
12
Consolidated funds – hospitality
revenue
—
16,273
16,273
Consolidated funds – other revenue
—
2,266
2,266
Total revenues
3,372
17,073
20,445
Expenses
Operating costs
6,731
89
6,820
General and administrative
1,398
28
1,426
Marketing and advertising
326
(1
)
325
Depreciation and amortization
92
45
137
Consolidated funds – hospitality
expenses
—
20,749
20,749
Consolidated funds – other expenses
—
1,949
1,949
Total expenses
8,547
22,859
31,406
Other income (expenses), net
297
249
546
Interest income
497
(401
)
96
Interest expense
(1,260
)
(1
)
(1,261
)
Net loss before income taxes
$
(5,641
)
$
(5,939
)
$
(11,580
)
Provision for income taxes
—
—
—
Net loss
(5,641
)
(5,939
)
(11,580
)
Net loss attributable to noncontrolling
interests
—
(5,854
)
(5,854
)
Net loss attributable to CaliberCos
Inc.
$
(5,641
)
$
(85
)
$
(5,726
)
REVENUE(1)
(AMOUNTS IN THOUSANDS)
(UNAUDITED)
Three Months Ended June 30,
2024
2024
2023
Fund set-up fees
$
665
$
9
Fund management fees
2,665
2,369
Financing fees
80
150
Development and construction fees
328
657
Brokerage fees
441
163
Total asset management
4,179
3,348
Performance allocations
33
24
Total revenue
$
4,212
$
3,372
___________________________________________
(1) Represents the results of our asset
management platform segment, which are presented on a basis that
deconsolidates our consolidated funds (intercompany eliminations)
and eliminate noncontrolling interest.
FV AUM
(AMOUNTS IN THOUSANDS)
(UNAUDITED)
Balances as of December 31, 2023
$
741,190
CHT contribution
29,900
Construction and net market
appreciation
10,971
Assets sold(1)
(12,771
)
Credit(2)
(781
)
Other(3)
(1,771
)
Balances as of March 31, 2024
766,738
Assets acquired(4)
14,000
Construction and net market
appreciation
27,994
Assets sold or disposed(1)
(22,994
)
Credit(2)
(12,835
)
Other(3)
310
Balances as of June 30, 2023
$
773,213
June 30,
2024
2023
Real Estate
Hospitality
$
68,000
$
67,200
Caliber Hospitality Trust
234,300
201,600
Residential
140,700
138,000
Commercial
251,300
240,400
Total Real Estate
694,300
647,200
Credit(1)
70,972
84,588
Other(2)
7,941
9,402
Total
$
773,213
$
741,190
___________________________________________
(1)
Assets sold during the six months ended
June 30, 2024 include a commercial asset, lot sales related to two
development assets in Colorado, and one home from our residential
fund.
(2)
Credit FV AUM represents loans made to
Caliber’s investment funds by our diversified credit fund.
(3)
Other FV AUM represents undeployed capital
held in our diversified funds.
(4)
Assets acquired during the six months
ended June 30, 2024 include land for one commercial asset in
Colorado.
MANAGED CAPITAL
(AMOUNTS IN THOUSANDS)
(UNAUDITED)
Managed Capital
Balances as of December 31, 2023
$
437,625
Originations
19,099
Redemptions
(2,819
)
Balances as of March 31, 2024
453,905
Originations
18,936
Redemptions
(3,041
)
Balances as of June 30, 2024
$
469,800
June 30, 2024
December 31, 2023
Real Estate
Hospitality
$
43,660
$
43,660
Caliber Hospitality Trust(1)
95,817
70,747
Residential
89,713
74,224
Commercial
161,697
155,004
Total Real Estate(2)
390,887
343,635
Credit(3)
70,972
84,588
Other(4)
7,941
9,402
Total
$
469,800
$
437,625
_________________________________________
(1)
The Company earns a fund management fee of
0.70% of the Caliber Hospitality Trust’s enterprise value and is
reimbursed for certain costs incurred on behalf of the Caliber
Hospitality Trust.
(2)
Beginning during the year ended December
31, 2023, the Company includes capital raised from investors in
CaliberCos Inc. through corporate note issuances that was further
invested in our funds in Managed Capital. As of June 30, 2024 and
December 31, 2023, the Company had invested $18.8 million and $18.3
million, respectively, in our funds.
(3)
Credit managed capital represents loans
made to Caliber’s investment funds by the Company and our
diversified funds. As of June 30, 2024 and December 31, 2023, the
Company had loaned $1.1 million and $8.5 million to our funds.
(4)
Other managed capital represents
undeployed capital held in our diversified funds.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20240812163924/en/
Caliber: Victoria Rotondo +1 480-295-7600
Victoria.Rotondo@caliberco.com
Investor Relations: Lisa Fortuna, Financial Profiles +1
310-622-8251 ir@caliberco.com
Media Relations: Kelly McAndrew, Financial Profiles +1
310-622-8239 KMcAndrew@finprofiles.com
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