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Annaly Capital Management reports higher net loss YOY in Q1

Annaly CapitalManagement Inc. reported a first-quarter GAAP net loss available tocommon stockholders of $885.9 million, or a loss of 96 cents per share, comparedwith a GAAP net loss available to common stockholders of $494.4 million, or 52 centsper share, in the year-ago quarter.

The increase in net loss for the quarter compared with the prior-yearquarter is primarily attributable to unfavorable changes in realized losses on interestrate swaps.

Core earnings for the quarter decreased to $123.3 million, or11 cents per share, from $254.1 million, or 25 cents per share, in the prior-yearquarter.

Normalized core earnings for the quarter were $291.8 million,or 30 cents per share, compared with $342.0 million, or 34 cents per share, a yearearlier. The year-over-year decline was due to a reduction in normalized interestincome earned on lower residential investment securities balances, partially offsetby increased interest income on a larger commercial investment portfolio duringthe quarter.

The S&P Capital IQ consensus normalized EPS estimate forthe quarter was 31 cents.

The company reported net interest income of $240.7 million forthe quarter, compared with $389.7 million for the quarter ended March 31, 2015.

The company's leverage was 5.3:1 at the end of the first quarter,compared with 5.1:1 at Dec. 31, 2015, and 4.8:1 at March 31, 2015.

On a GAAP basis, the company's annualized loss on average equitywas 29.47% as of March 31, compared with annualized return on average equity of22.15% as of Dec. 31, 2015, and annualized loss on average equity of 14.41% as ofMarch 31, 2015. On a normalized core earnings basis, annualized return on averageequity for the quarter was 9.91%, compared with 10.30% for quarter ended Dec. 31,2015, and 10.34% for the quarter ended March 31, 2015.

Book value per common share was $11.61 for the quarter, downfrom $12.88 in the prior-year period.