Bimini Capital Mgmt Inc A

Hello and welcome to Binnerman Capital Management second quarter 2026 earnings call. At this time, all participants are in a listen-only mode. After the speaker's presentation, there will be a question and answer session. To ask the question during the session, you will need to press star 11 on your telephone. You will then hear an automated message advising your hand is raised. To withdraw your question, please press star 11 again. I will now like to hand the conference over to Melissa Alfonso. You may begin.

Thank you. Good morning and welcome to the second quarter 2026 earnings conference call for Bimini Capital Management. This call is being recorded today, August 7th, 2026. At this time, the company would like to remind the listeners that statements made during today's conference call relating to matters that are not historical facts are forward-looking statements subject to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Listeners are cautioned that such forward-looking statements are based on information currently available on the management's good faith, belief with respect to future events, and are subject to risks and uncertainties that could cause actual performance results to differ materially from those expressed in such forward-looking statements. Important factors that could cause such differences are described in the company's filing, with the Securities and Exchange Commission, including the company's most recent annual report on Form 10-K. The company assumes no obligation to update such forward-looking statements to reflect actual results, changes in assumptions, or changes in other factors affecting forward-looking statements. Now, I'd like to turn the conference over to the company's Chairman and Chief Executive Officer, Mr. Robert Cauley. Please go ahead, sir.

Thanks, Melissa, and good morning. Regarding our results for the second quarter of 2026, market conditions for the agency RMBS market and risk assets generally were uneven and developments related to the war with Iran created volatility, causing market rallies and sell-offs with every headline. The Federal Reserve has a new chairman who was initially viewed as a stout inflation hawk after his first press conference in June, but much less so after his second in late July, resulting in a significant sell-off in longer-maturity interest rates and a steepening of the Treasury curve. Finally, the economy of the U.S. has proven to be very resilient and the labor market appears to have stabilized, at least before this morning. On top of all this, second quarter corporate earnings were robust and the AI-driven build-out has resulted in unprecedented levels of CapEx spending on the part of the hyperscalers. While this may prove to be inflationary near-term, as chip demand and prices surge, impacting prices of any product that uses them, productivity gains that are anticipated from AI should suppress inflation in future periods, or at least that's the conventional wisdom. In sum, even with this very mixed backdrop, risk assets had a very solid quarter, and this continued into the third quarter. Orchid Island Capital, or Orchid, reported an economic return of 6.2% for the quarter, grew its share count by approximately 1.5% and increased its average equity base by approximately 5.7% over the first quarter of 2026. This resulted in a 3.4% increase in our management fee revenue. As you know, we closed on the acquisition of Tom Johnson Investment Management on April 1st, 2026, so the results are now consolidated with ours. Advisory service revenues, inclusive of those of TGEM, were approximately $6.8 million for the second quarter versus $3.8 million for the second quarter of 2025 and $5.1 million for the first quarter of 2026, neither of which included any results from TGEM. In order to facilitate the acquisition of TGEM, which was an all-cash transaction, we used a combination of available cash and proceeds from the disposition of a portion of the investment portfolio. Note, we did not have to incur any debt to facilitate the transaction. In fact, we were able to retain a portion of the portfolio as well as our shares of work in Ireland. I want to highlight, for the second quarter of 2026, advisory service revenue of TGEM, less direct operating expenses, was roughly equal to the interest and dividend income, less repurchase agreement interest expense of the portfolio during the second quarter of 2025. As mentioned, we still retain an investment portfolio after funding the purchase of TGEM, the TGEM acquisition, although the market value of the portfolio as of June 30, 2026 was $37.9 million versus $120.8 million as of June 30, 2025. So it's a little under one-third of the size. We view the acquisition of TGEM as transformational for Mgmini. Our goal is to enhance the consistency of the earnings we generate as part of our tax-driven strategy in the near term, but also beyond. The acquisition should help us to do this as we diversify the mix of assets under management away from a sole focus on the agency RMBS market. We look forward to helping Teach & Grow their AUM over time, leveraging their track record, quality management team, and sound investment process. We hope we can facilitate this growth by leveraging our relationships across Wall Street and the banking community developed over the past 20 plus years by Bimini. Further, while we remain focused on our tax driven strategy of harvesting the tax savings provided by our NOLs, we recognize we are nearing the maturity of the NOLs and we must begin to focus on the years that follow. By the end of 2028, all but approximately 5.5 million of the NOLs of our former mortgage company will have been used or expired and that will drop to approximately 1 million by the end of 2029. Bimini has additional NOLs that do not expire until 2036, but those are quite small in comparison. Of course, we will attempt to take full advantage of all the NOLs we have available to us prior to their expiration. However, once the available NOLs have been utilized or expire, we will become a tax-paying entity. This will drive how we see the business in our balance sheet going forward. Bimini has been profitable year-to-date and cash flow positive as well. We anticipate this to be the case going forward. Given our market outlook and the possibility of increasing funding costs, should the Federal Reserve raise the Fed funds rate in the near term, we may start to pay down our trust preferred debt with available cash. This process will operate just like growing an income-producing asset base, only by a decreased interest expense versus increased interest income, had we increased the size of the portfolio. It will also facilitate the transition of our balance sheet referenced above, Richard Perry, the President and CIO of Tom Johnson Investment Management or TGM. I would like to turn the call over to Richard to tell us more about TGM's history, provide an overview of their investment products and processes, and give us an update on how their year is going so far. Richard?