The following is a summary of the AFC Gamma, Inc. (AFCG) Q2 2024 Earnings Call Transcript:

Financial Performance:

• AFC Gamma reported distributable earnings of $0.56 per share for Q2 2024.

• Net interest income reached $18.4 million, and GAAP net income was $16.4 million, equating to $0.80 per share.

• Total assets amounted to $458 million, with significant cash holdings of $170.3 million.

Business Progress:

• AFC Gamma completed the spin-off of its commercial real estate portfolio, sharpening its focus on cannabis lending. This strategic move is intended to optimize market opportunities.

• The company engaged actively in managing portfolio risks and achieved notable exits with high internal rates of return, such as exiting a $84 million loan at 19.9% IRR.

• Growth in loan origination was highlighted, with $57.3 million closed on three deals, moving towards a 2024 target of $100 million. They have a robust pipeline of $346 million.

Opportunities:

• The spin-off into a pure-play cannabis lender positions AFC to concentrate on a high-growth industry.

• Legalization movements in states like Ohio and potential market changes in Florida and Pennsylvania are expected to boost the demand for capital, offering significant opportunities for AFC.

Risks:

• The loan exits and management indicate a proactive approach in handling underperforming credits, reflecting an ongoing need to manage credit risks effectively.

More details: AFC Gamma IR

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