Starwood Property Trust, Inc (STWD) has reported a 9.40 percent fall in profit for the quarter ended Sep. 30, 2016. The company has earned $105.77 million in the quarter, compared with $116.74 million for the same period last year.
Revenue during the quarter grew 6.54 percent to $204.70 million from $192.14 million in the previous year period.
Cost of revenue went down marginally by 1.08 percent or $0.30 million during the quarter to $27.78 million. Gross margin for the quarter expanded 104 basis points over the previous year period to 86.43 percent.
Total expenses were $175.33 million for the quarter, up 36.91 percent or $47.26 million from year-ago period. Operating margin for the quarter contracted 1900 basis points over the previous year period to 14.35 percent.
Operating income for the quarter was $29.37 million, compared with $64.08 million in the previous year period.
“Our results this quarter were driven by contributions from across our businesses, demonstrating the strength of our multi-cylinder platform,” stated Barry Sternlicht, chairman and chief executive officer of Starwood Property Trust. “We deployed over $1.3 billion of capital this quarter and $3.8 billion year-to-date through volatile market conditions. The credit quality of our $9.1 billion portfolio remains strong, with an LTV on our loan book of just 63%. Since our move into long duration equity assets, we have reviewed countless property investments. This quarter, we identified an investment that met our objectives of long-term stable and rising cash flows, with attractive current cash-on-cash yields. We are under contract to close this investment, an exceptionally high quality medical office portfolio consisting of 38 buildings throughout the U.S. The portfolio is positioned to benefit from growth in the medical sector, high industry-wide tenant retention rates, minimal new supply and favorable demographic trends. By adding a resilient income stream that extends the duration of our overall book, we continue to build a portfolio that can withstand various market cycles.”
Net receivables were at $5,258.98 million as on Sep. 30, 2016, down 10.12 percent or $591.95 million from year-ago.
Investments stood at $888.98 million as on Sep. 30, 2016, up 8.05 percent or $66.21 million from year-ago.
Total assets declined 9.69 percent or $8,898.25 million to $82,921.16 million on Sep. 30, 2016. On the other hand, total liabilities were at $78,815.78 million as on Sep. 30, 2016, down 10.05 percent or $8,802.45 million from year-ago.
Return on assets moved down 6 basis points to 0.13 percent in the quarter. At the same time, return on equity moved down 20 basis points to 2.58 percent in the quarter.
Debt moves up
Total debt was at $5,565.06 million as on Sep. 30, 2016, up 8.13 percent or $418.65 million from year-ago. Shareholders equity stood at $4,105.38 million as on Sep. 30, 2016, down 2.28 percent or $95.80 million from year-ago. As a result, debt to equity ratio went up 13 basis points to 1.36 percent in the quarter.
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