Sachem Capital Corp. ((SACH)) has held its Q3 earnings call. Read on for the main highlights of the call.
Meet Your ETF AI Analyst
- Discover how TipRanks' ETF AI Analyst can help you make smarter investment decisions
- Explore ETFs TipRanks' users love and see what insights the ETF AI Analyst reveals about the ones you follow.
The recent earnings call for Sachem Capital Corp. presented a mixed sentiment, highlighting both positive developments and ongoing challenges. While the company has made strides in improving financial flexibility and reducing nonperforming loans, issues such as the Naples project and a decline in book value continue to pose significant hurdles. The overall sentiment reflects a balance between operational improvements and the impact of existing challenges.
Improved Financial Flexibility
Sachem Capital Corp. has enhanced its financial flexibility by fully repaying and delisting its 7.75% unsecured unsubordinated notes due September 30, 2025. This move not only strengthens the company’s balance sheet but also underscores its commitment to maintaining financial health.
Reduction in Nonperforming Loans
The company reported a significant decrease in the gross unpaid principal balance of nonperforming loans, which fell by $15.5 million to $104.1 million. This reduction marks a positive step towards stabilizing the company’s loan portfolio.
Sequential Quarterly Revenue Growth
Sachem Capital Corp. experienced an 11.4% increase in total revenue, rising from $10.8 million in Q2 2025 to $12 million in Q3 2025. This growth indicates a positive trend in the company’s financial performance.
Strong Performing Loan Yield
The effective interest rate on the average performing loan balance remained robust at approximately 12.4%. This consistency reflects the strength of the company’s performing loan return profile.
Shem Creek Capital Investments
Shem Creek Capital, a part of Sachem Capital Corp., generated $1.1 million in revenue for the quarter. This performance highlights the attractiveness of low-risk, double-digit yield investments within the company’s portfolio.
Significant Nonaccrual Loan Balance
The Naples project continues to be a significant concern, with a nonaccrual loan balance of $50.4 million, representing 13.4% of the mortgage loan portfolio. This issue remains a considerable weight on the company’s earnings.
Book Value Decline
The book value per share saw a decline of 2.8%, dropping from $2.54 at the end of June 2025 to $2.47 by the end of September 2025. This decrease reflects ongoing challenges within the company’s financial metrics.
Higher Nonaccrual Mix Impacting Revenue
The company’s year-over-year revenue faced a decline due to a smaller performing loan portfolio and a higher nonaccrual mix, impacting overall financial results.
Ongoing Challenges in Southwest Florida
The Naples project is plagued by permitting delays, contractor issues, and legal disputes, which continue to affect resolution timelines and pose challenges to the company’s operations in Southwest Florida.
Forward-Looking Guidance
Looking ahead, Sachem Capital Corp. remains focused on fortifying its financial position and managing its portfolio effectively. The company aims to resolve legacy assets, such as the Naples project, while capitalizing on new loan opportunities. With a robust pipeline and a focus on single-family and multifamily residential assets in strong markets, Sachem Capital is poised to navigate its current challenges while seeking growth opportunities.
In conclusion, the earnings call for Sachem Capital Corp. highlighted a mix of positive developments and ongoing challenges. While the company has made progress in improving financial flexibility and reducing nonperforming loans, issues such as the Naples project and a decline in book value continue to impact its financial performance. Investors and stakeholders will be keenly watching how Sachem Capital navigates these challenges and capitalizes on future opportunities.