Eagle Point Income Company Inc.

Greetings and welcome to Eagle Point Income Company first quarter 2023 financial results call. At this time, all participants are in a listen-only mode. A question and answer session will follow the formal presentation. If anyone should require operator assistance during the conference, please press star zero on your telephone keypad. As a reminder, this conference is being recorded. It is now my pleasure to introduce your host, Garrett Edson of ICR. Thank you. You may begin.

Thank you, Doug, and good morning. Before we begin our formal remarks, we need to remind everyone that the matters discussed on this call include forward-looking statements or projected financial information that involve risks and certainties that may cause the company's actual results to differ materially from those projected in such forward-looking statements and projected financial information. For further information on factors that could impact the company and the statements and projections contained herein, please refer to the company's Finance, Securities, and Exchange Commission. Each forward-looking statement and projection of financial information made during this call is based on information available to us as of the date of this call. We disclaim any obligation to update our forward-looking statements unless required by law. A replay of this call can be accessed for 30 days via the company's website, www.eaglepointincome.com. Earlier today, we filed our first quarter 2023 financial statements and our first quarter investor presentation with Securities and Exchange Commission. Financial statements and our first quarter investor presentation are also available within the investor relations section of the company's website. Financial statements can be found by following the financial statements and reports link, and the investor presentation can be found by following the presentation and events link. I would now like to introduce Tom Majewski, Chairman and Chief Executive Officer of Eagle Point Income Company.

Thank you, Garrett, and welcome everyone to Eagle Point Income Company's first quarter earnings call. We appreciate your interest in Eagle Point Income Company, or EIC. If you haven't done so already, we invite you to download our investor presentation from our website at eaglepointincome.com. I'll refer to this presentation during a portion of my remarks. Despite the turmoil in the banking world, the company did very well during the first quarter. EIC's investment portfolio generated increased cash flows thanks to the rising rate environment and the floating rate nature of our CLO junior debt. In the first quarter, NII was above our increased monthly common distribution level of 16 cents per share per month. Given rates are still elevated and will likely remain so for the near future, we believe our portfolio remains very well positioned to continue generating significant income and cash flow for the benefit of our investors. To share a few highlights from the quarter, net investment income was 49 cents per common share, exceeding our newly increased regular level of common distributions. Our recurring cash flows were $5.6 million, or $0.67 per common share, in excess of our regular common distributions and expenses. Our NAV as of March 31st was $13.20 per share, an increase of 2.2% from year-end 2020. Our NAV midpoint as of April 30th, which is an estimate, was essentially unchanged from that March 31st figure. We paid three monthly common distributions at our new level of $0.16 per share and have declared monthly common distributions of $0.16 per share through September 2023. This monthly distribution rate reflects a 14% increase from our distribution rate in the fourth quarter. We also opportunistically raised capital through our at-the-market and committed equity programs, issuing over 500,000 common shares at a premium to NAV generating NAV accretion of $0.05 per share during the quarter. These sales generated net proceeds of approximately $7.4 million during the first quarter. We also continued to raise capital selectively during the second quarter. April cash flows were further favorably impacted by increases in LIBOR and SOFR. As clearly evident, our portfolio continues to benefit from the floating rate nature of CLOs, given that 100% of our CLO debt investments are floating rate. In fact, many CLO BB yields are now comfortably into the double digits, with some CLOs yielding north of 20% in an early call scenario. As long-term focused investors, we seek to construct our portfolio to manage through periods of dislocation, and our consistently strong performance with respect to cash flow and income is validation that we're executing on that playbook. We also continue to seek to lengthen the weighted average remaining reinvestment periods of our CLO debt and equity portfolios through vintage diversification. We continue to have a significant amount of dry powder available on our revolver where we see investment opportunities. We're excited for our portfolio's potential for the remainder of 2023 and beyond. For additional commentary on the overall markets and recent portfolio activity, I'd like to turn the call over to one of Eagle Point's senior principals and our portfolio manager, Dan Koch.