Cherry Hill Mortgage Investment Corporation — Second Quarter 2026 Earnings Summary

Financial Performance

• Reported GAAP net income applicable to common stockholders of $1.3 million ($0.04 per share) for the quarter ended June 30, 2026, compared to a net loss of $1.9 million ($0.05 per share) in the prior quarter ended March 31, 2026.
• Earnings available for distribution (EAD) attributable to common stockholders were $5.5 million ($0.15 per diluted share), up from $5.3 million ($0.14 per diluted share) in the prior quarter.
• Net interest income was $4.7 million, compared to $4.5 million in the prior quarter.
• Net servicing income was $7.4 million, down from $7.9 million in the prior quarter.
• Total other loss was $4.2 million, driven by a $1.0 million realized loss on RMBS, a $9.3 million unrealized loss on derivatives, a $2.4 million unrealized loss on servicing-related assets, and a $2.8 million credit loss and impairment on other assets, partially offset by a $12.1 million realized gain on derivatives.
• General and administrative expenses and compensation and benefits totaled $4.0 million, up from $3.3 million in the prior quarter.
• Common book value per share was $3.16 at June 30, 2026.
• Aggregate portfolio leverage stood at 5.02x at quarter-end.
• Unrestricted cash held was $52.1 million as of June 30, 2026.

Guidance and Future Outlook

• The company expects the merger with TPG Mortgage Investment Trust, Inc. (MITT) to close in the fourth quarter of 2026, subject to customary closing conditions and stockholder approvals.
• Due to the pending merger transaction, the company will not host its scheduled webcast and conference call.

Business Segments and Product Lines

• The Mortgage Servicing Rights (MSR) portfolio had an unpaid principal balance of $15.2 billion and a carrying value of $211.1 million as of June 30, 2026.
• The RMBS portfolio had a book and carrying value of approximately $1.1 billion, with a weighted average coupon of 5.08% and a weighted average maturity of 27 years.
• Net interest spread for the RMBS portfolio was 3.45%.
• To mitigate duration and interest rate risk, the company utilized interest rate swaps ($767.3 million notional), TBAs ($266.9 million notional), Treasury futures ($28.4 million notional), and Eris SOFR swap futures ($82.0 million notional) as of June 30, 2026.
• Net unrealized gain on RMBS classified as available-for-sale reported in accumulated other comprehensive income was approximately $0.5 million.

Market and Competitive Landscape

• No specific market share data or direct competitor performance metrics were disclosed in the release.

Risks and Challenges

• Risks include the potential failure to complete the merger transaction, failure to obtain requisite stockholder or regulatory approvals, competing offers, and the diversion of management attention to the transaction.
• Risks related to the transaction include the possibility of the stock price declining if the transaction is not consummated, stockholder litigation, and the risk that the transaction may not qualify as a tax-free reorganization.
• General business risks include changes in interest rates, credit spreads, prepayment rates, default rates, market volatility, and general economic conditions affecting mortgage-related assets.
• Risks also include the potential failure to maintain qualification as a REIT.

Management Commentary and Tone

• The Board of Directors unanimously approved the strategic merger transaction with MITT.
• Management highlighted the transaction represents a 29% premium to the closing price on August 7, 2026, and a 32% premium to the 30-Day Volume Weighted Average Price.
• The tone indicates a strategic pivot toward consolidation, as evidenced by the cancellation of the earnings call to focus on the merger.

Analyst Questions and Answers

• No analyst questions and answers section was included in the press release.

Other Key Points

• Cherry Hill entered into a definitive merger agreement to be acquired by TPG Mortgage Investment Trust, Inc. (NYSE: MITT) for an implied transaction value of $117.5 million.
• Under the merger terms, CHMI common stockholders will receive 0.3063 shares of MITT common stock and $0.93 in cash per share.
• The Board declared a regular common dividend of $0.10 per share for the second quarter, paid on July 31, 2026, resulting in an annualized yield of 16.6% based on the August 7, 2026 closing price.
• Dividends were also declared on preferred stock: $0.5125 per share on the 8.20% Series A and $0.6045 per share on the 8.250% Series B, paid on July 15, 2026.
• MITT is a publicly listed residential mortgage REIT managed by AG REIT Management, LLC, an affiliate of TPG Inc.