Ares Commercial reports Q1 distributable EPS 27c, consensus 23c

Reports Q1 revenue $26.50M, consensus $28.26M. "Our results this quarter demonstrated not only another period of healthy investment returns as we benefited from higher interest rates, but also solid progress with respect to resolving watch list assets," said Bryan Donohoe, CEO. "Our 27c of Distributable EPS, inclusive of the previously announced realized loss of $0.10 per diluted common share, would have resulted in 37c per diluted common share without the realized loss, which more than fully covers our regular and supplemental quarterly dividend. We remain confident that our strong financial position, our deep credit capabilities and the broad resources of Ares Management will enable us to navigate the industry challenges, capitalize on an expanded market opportunity from bank retrenchment and continue to generate attractive dividends for shareholders". "We continued to build liquidity and operate with strong capital levels throughout the quarter," said CFO Tae-Sik Yoon. "With non-spread based mark to market financing, net debt-to-equity below 2.0x and more than $150M in cash representing more than 20% of stockholders’ equity as of March 31, 2023, we believe our strong balance sheet positions us to maximize credit outcomes on our higher risk rated assets and make new opportunistic investments with attractive risk adjusted returns."