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Ellington Financial Inc. Reports Second Quarter 2025 Results

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OLD GREENWICH, Conn.--(BUSINESS WIRE)-- Ellington Financial Inc. (NYSE: EFC) ("we") today reported financial results for the quarter ended June 30, 2025.

Highlights

  • Net income attributable to common stockholders of $42.9 million, or $0.45 per common share.1
    • $56.8 million, or $0.60 per common share, from the investment portfolio.
      • $57.8 million, or $0.61 per common share, from the credit strategy.
      • $(1.0) million, or $(0.01) per common share, from the Agency strategy.
    • $10.7 million, or $0.11 per common share, from Longbridge.
  • Adjusted Distributable Earnings of $45.0 million, or $0.47 per common share.2
    • $53.8 million, or $0.56 per common share, from the investment portfolio.
    • $12.8 million, or $0.13 per common share, from Longbridge.
  • Book value per common share as of June 30, 2025 of $13.49, including the effects of dividends of $0.39 per common share for the quarter.
  • Dividend yield of 12.3% based on the August 6, 2025 closing stock price of $12.72 per share, and monthly dividend of $0.13 per common share declared on August 7, 2025.
  • Recourse debt-to-equity ratio3 of 1.7:1 as of June 30, 2025. Including all recourse and non-recourse borrowings, which primarily consist of securitization-related liabilities, debt-to-equity ratio of 8.7:14.
  • Cash and cash equivalents of $211.0 million as of June 30, 2025, in addition to other unencumbered assets of $708.8 million.

Second Quarter 2025 Results

"Ellington Financial delivered a strong second quarter, with broad-based contributions from our diversified investment portfolio and loan origination platforms. We generated net income of $0.45 per share, equating to an annualized economic return of 13.8% for the quarter, with book value per share increasing quarter over quarter to $13.49. Meanwhile, our adjusted distributable earnings per share increased sharply by $0.08 to $0.47, significantly exceeding our $0.39 of dividends," said Laurence Penn, Chief Executive Officer and President.

"Our securitization momentum remains strong, as we completed six transactions during the quarter. The size of our investment portfolio was roughly unchanged sequentially, as opportunistic purchases particularly during the April selloff and growth in certain loan portfolios were offset by the impact of securitizations, tactical sales, and steady principal repayments from our short-term loan portfolios.

"Looking ahead, I believe we are well positioned to continue delivering strong earnings through ongoing portfolio expansion, a faster pace of securitizations—including four priced so far in the third quarter—and continued strong contributions from Longbridge. Longbridge generated a robust $0.13 per share of ADE in the second quarter, and its ADE contributions should be further supported by the recent launch of its HELOC For Seniors program. We are also committed to further strengthening our liability structure, not only through additional securitizations but also by strategically increasing unsecured borrowings over time."

Financial Results

Investment Portfolio Segment

The investment portfolio segment generated net income of $57.4 million in the second quarter, consisting of $58.4 million from the credit strategy and $(1.0) million from the Agency strategy.

Credit Performance

The total adjusted long credit portfolio5 increased by 1% to $3.32 billion as of June 30, 2025, compared to $3.30 billion as of March 31, 2025. Our portfolios of commercial mortgage bridge loans, non-QM loans, and non-Agency RMBS all expanded, driven by net purchases. These increases were largely offset by the impact of securitizations, tactical sales of home equity line of credit ("HELOC") and non-QM loans, and a smaller residential transition loan portfolio, with principal paydowns in that portfolio exceeding new purchases.

Key Highlights6:

  • Overall positive performance driven by higher net interest income and net realized and unrealized gains from non-QM loans and retained tranches, closed-end second lien loans and retained tranches, and other loans and ABS.
  • Positive results from equity investments in loan originators.
  • Partially offsetting higher net interest income were net unrealized losses on forward MSR-related investments, as well as losses on commercial and residential REO.

During the quarter, the net interest margin7 on our credit portfolio increased to 3.11% from 2.90%, driven primarily by a lower cost of funds. We continued to benefit from positive carry on our interest rate swap hedges, where we overall receive a higher floating rate and pay a lower fixed rate.

Agency Performance

The long Agency RMBS portfolio increased by 5% quarter over quarter to $268.5 million as of June 30, 2025, compared to $256.1 million as of March 31, 2025, driven by net purchases.

Key Highlights6:

  • Agency RMBS yield spreads widened in early April, driven in part by increased volatility due to tariff-related uncertainty. Yield spreads reversed course in May and June, tightening meaningfully, but still ended the quarter wider overall.
  • Net losses on interest rate hedges drove the overall loss for the quarter.
  • Pay-ups on our specified pools increased slightly to 0.71% as of June 30, 2025, from 0.69% as of March 31, 2025.

The net interest margin7 on our Agency portfolio (excluding the Catch-up Amortization Adjustment) decreased to 2.29% as of June 30, 2025 from 2.46% as of March 31, 2025, driven primarily by a higher cost of funds.

Longbridge Segment

The Longbridge segment reported net income of $10.7 million for the second quarter. The Longbridge portfolio (excluding non-retained tranches of consolidated securitization trusts) decreased by 1% sequentially to $545.6 million as of June 30, 2025, as the impact of a securitization of proprietary reverse mortgage loans completed during the quarter slightly exceeded the impact of new originations in that sector.

Key Highlights6:

  • Positive contribution from originations, driven by higher origination volumes in both HECM and proprietary reverse loans, steady origination margins for both products, and net gains related to the proprietary reverse mortgage loan securitization.
  • Positive contribution from servicing, including MSR-related income, strong tail securitization executions, and a net gain on the HMBS MSR Equivalent, driven primarily by tighter HMBS yield spreads.
  • Net losses on interest rate hedges.

Corporate/Other Summary

Results for the quarter also reflect a decrease in incentive fees incurred partially offset by net unrealized loss on our unsecured borrowings and an increase in income tax expense.

____________________________________

1 Represents $67.6 million of aggregate net income from the investment portfolio and Longbridge segments, less $24.6 million of preferred dividends accrued and certain corporate/other income and expense items not attributed to either the investment portfolio or Longbridge segments.
2 Adjusted Distributable Earnings is a non-GAAP financial measure. See "Reconciliation of Net Income (Loss) to Adjusted Distributable Earnings" below for an explanation regarding the calculation of Adjusted Distributable Earnings. Represents $66.6 million of aggregate Adjusted Distributable Earnings from the investment portfolio and Longbridge segments, less $21.6 million of certain corporate/other items not attributed to either the investment portfolio or Longbridge segments.
3 Excludes U.S. Treasury securities and repo borrowings at certain unconsolidated entities that are recourse to us. Including such borrowings, our debt-to-equity ratio, adjusted for unsettled purchases and sales, based on total recourse borrowings was 1.9:1 as of June 30, 2025.
4 Excludes U.S. Treasury securities and repo borrowings at certain unconsolidated entities.
5 Excludes non-retained tranches of consolidated securitization trusts. The adjusted long credit portfolio also includes the proceeds from financings related to the MSRs underlying our Forward MSR-related investments. Forward MSR-related investments, at fair value are presented on our Consolidated Balance Sheet net of such financings; as of both June 30, 2025 and March 31, 2025, such borrowings were $93.5 million.
6 Sector-level results include associated financing costs and hedging gains/losses where applicable.
7 Net interest margin represents the weighted average asset yield less the weighted average secured financing cost of funds on such assets. It also includes the effect of actual and accrued periodic payments on interest rate swaps used to hedge the assets.

Credit Portfolio(1)

The following table summarizes our credit portfolio holdings as of June 30, 2025 and March 31, 2025:

Ìý

Ìý

June 30, 2025

Ìý

March 31, 2025(2)

($ in thousands)

Ìý

Fair Value

Ìý

%

Ìý

Fair Value

Ìý

%

Dollar denominated:

Ìý

Ìý

Ìý

Ìý

Ìý

Ìý

Ìý

Ìý

CLOs

Ìý

$

37,168

Ìý

0.8

%

Ìý

$

27,958

Ìý

0.6

%

CMBS

Ìý

Ìý

35,328

Ìý

0.8

%

Ìý

Ìý

36,545

Ìý

0.8

%

Commercial mortgage loans(3)(4)

Ìý

Ìý

582,085

Ìý

12.8

%

Ìý

Ìý

505,459

Ìý

11.1

%

Consumer loans and ABS backed by consumer loans(5)

Ìý

Ìý

89,984

Ìý

2.0

%

Ìý

Ìý

87,172

Ìý

1.9

%

Corporate debt and equity and corporate loans

Ìý

Ìý

24,189

Ìý

0.5

%

Ìý

Ìý

24,915

Ìý

0.5

%

Debt and equity investments in loan origination-related entities(6)

Ìý

Ìý

73,842

Ìý

1.6

%

Ìý

Ìý

59,791

Ìý

1.3

%

Forward MSR-related investments

Ìý

Ìý

81,256

Ìý

1.8

%

Ìý

Ìý

87,203

Ìý

1.9

%

Home equity line of credit and closed-end second lien loans and retained RMBS(5)(7)

Ìý

Ìý

322,721

Ìý

7.1

%

Ìý

Ìý

423,109

Ìý

9.3

%

Non-Agency RMBS

Ìý

Ìý

112,949

Ìý

2.5

%

Ìý

Ìý

101,187

Ìý

2.2

%

Non-QM loans and retained RMBS(3)(5)(7)

Ìý

Ìý

2,186,350

Ìý

48.1

%

Ìý

Ìý

2,067,841

Ìý

45.6

%

Other investments(8)(9)

Ìý

Ìý

57,326

Ìý

1.3

%

Ìý

Ìý

58,134

Ìý

1.3

%

Residential transition loans and other residential mortgage loans(3)

Ìý

Ìý

877,421

Ìý

19.3

%

Ìý

Ìý

1,002,344

Ìý

22.1

%

Non-Dollar denominated:

Ìý

Ìý

Ìý

Ìý

Ìý

Ìý

Ìý

Ìý

CLOs

Ìý

Ìý

6,993

Ìý

0.2

%

Ìý

Ìý

6,558

Ìý

0.2

%

Corporate debt and equity

Ìý

Ìý

207

Ìý

�

%

Ìý

Ìý

190

Ìý

�

%

RMBS(10)

Ìý

Ìý

14,138

Ìý

0.3

%

Ìý

Ìý

13,271

Ìý

0.3

%

Other residential mortgage loans

Ìý

Ìý

38,725

Ìý

0.9

%

Ìý

Ìý

38,364

Ìý

0.9

%

Total long credit portfolio

Ìý

$

4,540,682

Ìý

100.0

%

Ìý

$

4,540,040

Ìý

100.0

%

Adjustments:

Ìý

Ìý

Ìý

Ìý

Ìý

Ìý

Ìý

Ìý

Less: Non-retained tranches of consolidated securitization trusts

Ìý

Ìý

1,319,037

Ìý

Ìý

Ìý

Ìý

1,337,020

Ìý

Ìý

Plus: Financing underlying Forward MSR-related investments(11)

Ìý

Ìý

93,500

Ìý

Ìý

Ìý

Ìý

93,500

Ìý

Ìý

Total adjusted long credit portfolio

Ìý

$

3,315,145

Ìý

Ìý

Ìý

$

3,296,520

Ìý

Ìý

(1)

This information does not include U.S. Treasury securities, securities sold short, or financial derivatives.

(2)

Conformed to current period presentation.

(3)

Includes related REO. In accordance with U.S. GAAP, REO is not considered a financial instrument and as a result is included at the lower of cost or fair value.

(4)

Also includes equity investments in unconsolidated entities holding commercial mortgage loans and REO and corporate loans secured by commercial mortgage loans.

(5)

Also includes equity investments in securitization-related vehicles.

(6)

Also includes corporate loans made to certain loan origination entities in which we hold an equity investment.

(7)

Retained RMBS represents RMBS issued by non-consolidated Ellington-sponsored loan securitization trusts, and interests in entities holding such RMBS.

(8)

Also includes equity investment in Ellington affiliate.

(9)

Includes equity investment in an unconsolidated entity which purchases certain other loans for eventual securitization.

(10)

Includes an equity investment in an unconsolidated entity holding European RMBS.

(11)

We participate in the economic returns of a portfolio of forward MSRs under various agreements with a licensed mortgage servicer holding such MSRs. Under such agreements, we can direct the servicer to finance the MSRs and distribute the proceeds of such financings to us. Forward MSR-related investments, at fair value are presented on our Consolidated Balance sheet net of any such financings; as of both June 30, 2025 and March 31, 2025, such borrowings were $93.5 million.

Agency RMBS Portfolio

The following table(1) summarizes our Agency RMBS portfolio holdings as of June 30, 2025 and March 31, 2025:

Ìý

Ìý

June 30, 2025

Ìý

March 31, 2025

($ in thousands)

Ìý

Fair Value

Ìý

%

Ìý

Fair Value

Ìý

%

Long Agency RMBS:

Ìý

Ìý

Ìý

Ìý

Ìý

Ìý

Ìý

Ìý

Fixed rate

Ìý

$

254,461

Ìý

94.8

%

Ìý

$

241,580

Ìý

94.3

%

Reverse mortgages

Ìý

Ìý

1,159

Ìý

0.4

%

Ìý

Ìý

1,499

Ìý

0.6

%

IOs

Ìý

Ìý

12,887

Ìý

4.8

%

Ìý

Ìý

13,016

Ìý

5.1

%

Total long Agency RMBS

Ìý

$

268,507

Ìý

100.0

%

Ìý

$

256,095

Ìý

100.0

%

(1)

This information does not include U.S. Treasury securities, securities sold short, or financial derivatives.

Longbridge Portfolio

Longbridge originates reverse mortgage loans, including home equity conversion mortgage loans, or "HECMs," which are insured by the FHA and which are eligible for inclusion in GNMA-guaranteed HECM-backed MBS, or "HMBS." Upon securitization, the HECMs remain on our balance sheet under GAAP, and Longbridge retains the mortgage servicing rights associated with the HMBS, or the "HMBS MSR Equivalent." Longbridge also originates "proprietary reverse mortgage loans," which are not insured by the FHA, and Longbridge has typically retained the associated MSRs. We have securitized some of the proprietary reverse mortgage loans originated by Longbridge, and we have retained certain of the securitization tranches in compliance with credit risk retention rules.

The following table summarizes loan-related assets(1) in the Longbridge segment as of June 30, 2025 and March 31, 2025:

Ìý

Ìý

June 30, 2025

Ìý

March 31, 2025

Ìý

Ìý

(In thousands)

HMBS assets(2)

Ìý

$

9,920,301

Ìý

Ìý

$

9,597,451

Ìý

Less: HMBS liabilities

Ìý

Ìý

(9,814,811

)

Ìý

Ìý

(9,495,132

)

HMBS MSR Equivalent

Ìý

Ìý

105,490

Ìý

Ìý

Ìý

102,319

Ìý

Unsecuritized HECM loans(3)

Ìý

Ìý

128,802

Ìý

Ìý

Ìý

131,883

Ìý

Proprietary reverse mortgage loans(4)

Ìý

Ìý

1,085,125

Ìý

Ìý

Ìý

866,425

Ìý

Reverse MSRs

Ìý

Ìý

29,276

Ìý

Ìý

Ìý

29,536

Ìý

Unsecuritized REO

Ìý

Ìý

1,962

Ìý

Ìý

Ìý

2,489

Ìý

Total

Ìý

Ìý

1,350,655

Ìý

Ìý

Ìý

1,132,652

Ìý

Less: Non-retained tranches of consolidated securitization trusts

Ìý

Ìý

805,046

Ìý

Ìý

Ìý

583,686

Ìý

Total, excluding non-retained tranches of consolidated securitization trusts

Ìý

$

545,609

Ìý

Ìý

$

548,966

Ìý

(1)

This information does not include financial derivatives or loan commitments.

(2)

Includes HECM loans, related REO, and claims or other receivables.

(3)

As of June 30, 2025, includes $11.9 million of active HECM buyout loans, $17.7 million of inactive HECM buyout loans, and $5.3 million of other inactive HECM loans. As of March 31, 2025, includes $14.0 million of active HECM buyout loans, $14.1 million of inactive HECM buyout loans, and $5.2 million of other inactive HECM loans.

(4)

As of June 30, 2025, includes $828.4 million of securitized proprietary reverse mortgage loans, $18.0 million of cash held in a securitization reserve fund, and $7.5 million of investment related receivables. As of March 31, 2025, includes $615.3 million of securitized proprietary reverse mortgage loans and $12.4 million of cash held in a securitization reserve fund.

The following table summarizes Longbridge's origination volumes by channel for the three-month periods ended June 30, 2025 and March 31, 2025:

($ In thousands)

Ìý

June 30, 2025

Ìý

March 31, 2025

Channel

Ìý

Units

Ìý

New Loan Origination Volume(1)

Ìý

% of New Loan Origination Volume

Ìý

Units

Ìý

New Loan Origination Volume(1)

Ìý

% of New Loan Origination Volume

Wholesale and correspondent

Ìý

1,374

Ìý

$

308,354

Ìý

72

%

Ìý

1,267

Ìý

$

241,675

Ìý

71

%

Retail

Ìý

687

Ìý

Ìý

118,708

Ìý

28

%

Ìý

554

Ìý

Ìý

96,776

Ìý

29

%

Total

Ìý

2,061

Ìý

$

427,062

Ìý

100

%

Ìý

1,821

Ìý

$

338,451

Ìý

100

%

(1)

Represents initial borrowed amounts on reverse mortgage loans.

Financing

Key Highlights:

  • Recourse Debt-to-Equity Ratio3 (adjusted for unsettled trades): 1.7:1 as of both June 30, 2025 and March 31, 2025.
  • Overall Debt-to-Equity Ratio4 (adjusted for unsettled trades): 8.7:1 as of both June 30, 2025 and March 31, 2025.

The following table summarizes our outstanding borrowings and debt-to-equity ratios as of June 30, 2025 and March 31, 2025:

Ìý

Ìý

June 30, 2025

Ìý

March 31, 2025

Ìý

Ìý

Outstanding Borrowings(1)

Ìý

Debt-to-Equity Ratio(2)

Ìý

Outstanding Borrowings(1)

Ìý

Debt-to-Equity Ratio(2)

Ìý

Ìý

(In thousands)

Ìý

Ìý

Ìý

(In thousands)

Ìý

Ìý

Recourse borrowings(3)(4)

Ìý

$

2,950,497

Ìý

1.7:1

Ìý

$

3,099,550

Ìý

1.9:1

Non-recourse borrowings(4)

Ìý

Ìý

11,942,036

Ìý

7.0:1

Ìý

Ìý

11,421,843

Ìý

7.0:1

Total Borrowings

Ìý

$

14,892,533

Ìý

8.8:1

Ìý

$

14,521,393

Ìý

8.9:1

Total Equity

Ìý

$

1,689,510

Ìý

Ìý

Ìý

$

1,637,616

Ìý

Ìý

Recourse borrowings excluding U.S. Treasury securities, adjusted for unsettled purchases and sales

Ìý

Ìý

Ìý

1.7:1

Ìý

Ìý

Ìý

1.7:1

Total borrowings excluding U.S. Treasury securities, adjusted for unsettled purchases and sales

Ìý

Ìý

Ìý

8.7:1

Ìý

Ìý

Ìý

8.7:1

(1)

Includes borrowings under repurchase agreements, other secured borrowings, other secured borrowings, at fair value, and unsecured debt, at par.

(2)

Recourse and overall debt-to-equity ratios are computed by dividing outstanding recourse and overall borrowings, respectively, by total equity. Debt-to-equity ratios do not account for liabilities other than debt financings.

(3)

Excludes repo borrowings at certain unconsolidated entities that are recourse to us. Including such borrowings, our debt-to-equity ratio based on total recourse borrowings is 1.9:1 as of both June 30, 2025 and March 31, 2025.

(4)

All of our non-recourse borrowings are secured by collateral. In the event of default under a non-recourse borrowing, the lender has a claim against the collateral but not any of the other assets held by us or our consolidated subsidiaries. In the event of default under a recourse borrowing, the lender's claim is not limited to the collateral (if any).

Operating Results

The following table summarizes our operating results by strategy for the three-month period ended June 30, 2025:

Ìý

Investment Portfolio

Ìý

Longbridge

Ìý

Corporate/

Other

Ìý

Total

Ìý

Per

Share

(In thousands except per share amounts)

Credit

Ìý

Agency

Ìý

Investment Portfolio Subtotal

Ìý

Ìý

Ìý

Ìý

Interest income and other income(1)

$

87,096

Ìý

Ìý

$

2,840

Ìý

Ìý

$

89,936

Ìý

Ìý

$

28,842

Ìý

Ìý

$

1,668

Ìý

Ìý

$

120,446

Ìý

Ìý

$

1.24

Ìý

Interest expense

Ìý

(44,486

)

Ìý

Ìý

(2,243

)

Ìý

Ìý

(46,729

)

Ìý

Ìý

(16,687

)

Ìý

Ìý

(3,971

)

Ìý

Ìý

(67,387

)

Ìý

Ìý

(0.69

)

AGÕæÈ˹ٷ½ized gain (loss), net

Ìý

9,038

Ìý

Ìý

Ìý

(423

)

Ìý

Ìý

8,615

Ìý

Ìý

Ìý

41

Ìý

Ìý

Ìý

�

Ìý

Ìý

Ìý

8,656

Ìý

Ìý

Ìý

0.09

Ìý

Unrealized gain (loss), net

Ìý

14,993

Ìý

Ìý

Ìý

1,801

Ìý

Ìý

Ìý

16,794

Ìý

Ìý

Ìý

14,197

Ìý

Ìý

Ìý

(1,699

)

Ìý

Ìý

29,292

Ìý

Ìý

Ìý

0.30

Ìý

Net change from reverse mortgage loans and HMBS obligations

Ìý

�

Ìý

Ìý

Ìý

�

Ìý

Ìý

Ìý

�

Ìý

Ìý

Ìý

26,605

Ìý

Ìý

Ìý

�

Ìý

Ìý

Ìý

26,605

Ìý

Ìý

Ìý

0.28

Ìý

Earnings in unconsolidated entities

Ìý

17,072

Ìý

Ìý

Ìý

�

Ìý

Ìý

Ìý

17,072

Ìý

Ìý

Ìý

�

Ìý

Ìý

Ìý

�

Ìý

Ìý

Ìý

17,072

Ìý

Ìý

Ìý

0.18

Ìý

Interest rate hedges and other activity, net(2)

Ìý

(912

)

Ìý

Ìý

(2,974

)

Ìý

Ìý

(3,886

)

Ìý

Ìý

(2,506

)

Ìý

Ìý

(127

)

Ìý

Ìý

(6,519

)

Ìý

Ìý

(0.07

)

Credit hedges and other activities, net(3)

Ìý

(16,863

)

Ìý

Ìý

�

Ìý

Ìý

Ìý

(16,863

)

Ìý

Ìý

(1,688

)

Ìý

Ìý

�

Ìý

Ìý

Ìý

(18,551

)

Ìý

Ìý

(0.19

)

Income tax (expense) benefit

Ìý

�

Ìý

Ìý

Ìý

�

Ìý

Ìý

Ìý

�

Ìý

Ìý

Ìý

�

Ìý

Ìý

Ìý

(1,475

)

Ìý

Ìý

(1,475

)

Ìý

Ìý

(0.02

)

Investment related expenses

Ìý

(5,468

)

Ìý

Ìý

�

Ìý

Ìý

Ìý

(5,468

)

Ìý

Ìý

(13,179

)

Ìý

Ìý

�

Ìý

Ìý

Ìý

(18,647

)

Ìý

Ìý

(0.19

)

Other expenses

Ìý

(2,038

)

Ìý

Ìý

�

Ìý

Ìý

Ìý

(2,038

)

Ìý

Ìý

(24,944

)

Ìý

Ìý

(11,437

)

Ìý

Ìý

(38,419

)

Ìý

Ìý

(0.40

)

Net income (loss)

Ìý

58,432

Ìý

Ìý

Ìý

(999

)

Ìý

Ìý

57,433

Ìý

Ìý

Ìý

10,681

Ìý

Ìý

Ìý

(17,041

)

Ìý

Ìý

51,073

Ìý

Ìý

Ìý

0.53

Ìý

Dividends on preferred stock

Ìý

�

Ìý

Ìý

Ìý

�

Ìý

Ìý

Ìý

�

Ìý

Ìý

Ìý

�

Ìý

Ìý

Ìý

(7,036

)

Ìý

Ìý

(7,036

)

Ìý

Ìý

(0.07

)

Net (income) loss attributable to non-participating non-controlling interests

Ìý

(602

)

Ìý

Ìý

�

Ìý

Ìý

Ìý

(602

)

Ìý

Ìý

�

Ìý

Ìý

Ìý

(5

)

Ìý

Ìý

(607

)

Ìý

Ìý

(0.01

)

Net income (loss) attributable to common stockholders and participating non-controlling interests

Ìý

57,830

Ìý

Ìý

Ìý

(999

)

Ìý

Ìý

56,831

Ìý

Ìý

Ìý

10,681

Ìý

Ìý

Ìý

(24,082

)

Ìý

Ìý

43,430

Ìý

Ìý

Ìý

0.45

Ìý

Net (income) loss attributable to participating non-controlling interests

Ìý

�

Ìý

Ìý

Ìý

�

Ìý

Ìý

Ìý

�

Ìý

Ìý

Ìý

�

Ìý

Ìý

Ìý

(507

)

Ìý

Ìý

(507

)

Ìý

Ìý

�

Ìý

Net income (loss) attributable to common stockholders

$

57,830

Ìý

Ìý

$

(999

)

Ìý

$

56,831

Ìý

Ìý

$

10,681

Ìý

Ìý

$

(24,589

)

Ìý

$

42,923

Ìý

Ìý

$

0.45

Ìý

Net income (loss) attributable to common stockholders per share of common stock

$

0.61

Ìý

Ìý

$

(0.01

)

Ìý

$

0.60

Ìý

Ìý

$

0.11

Ìý

Ìý

$

(0.26

)

Ìý

$

0.45

Ìý

Ìý

Ìý

Weighted average shares of common stock and convertible units(4) outstanding

Ìý

Ìý

Ìý

Ìý

Ìý

Ìý

Ìý

Ìý

Ìý

Ìý

Ìý

96,995

Ìý

Ìý

Ìý

Weighted average shares of common stock outstanding

Ìý

Ìý

Ìý

Ìý

Ìý

Ìý

Ìý

Ìý

Ìý

Ìý

Ìý

95,862

Ìý

Ìý

Ìý

(1)

Other income primarily consists of rental income on real estate owned, loan origination fees, and servicing income.

(2)

Includes U.S. Treasury securities, if applicable.

(3)

Other activities include certain equity and other trading strategies and related hedges, and net realized and unrealized gains (losses) on foreign currency.

(4)

Convertible units include Operating Partnership units attributable to participating non-controlling interests.

The following table summarizes our operating results by strategy for the three-month period ended March 31, 2025:

Ìý

Ìý

Investment Portfolio

Ìý

Longbridge

Ìý

Corporate/

Other

Ìý

Total

Ìý

Per

Share

(In thousands except per share amounts)

Ìý

Credit

Ìý

Agency

Ìý

Investment Portfolio Subtotal

Ìý

Ìý

Ìý

Ìý

Interest income and other income(1)

Ìý

$

87,077

Ìý

Ìý

$

4,140

Ìý

Ìý

$

91,217

Ìý

Ìý

$

23,056

Ìý

Ìý

$

1,714

Ìý

Ìý

$

115,987

Ìý

Ìý

$

1.25

Ìý

Interest expense

Ìý

Ìý

(46,503

)

Ìý

Ìý

(2,498

)

Ìý

Ìý

(49,001

)

Ìý

Ìý

(13,745

)

Ìý

Ìý

(4,481

)

Ìý

Ìý

(67,227

)

Ìý

Ìý

(0.73

)

AGÕæÈ˹ٷ½ized gain (loss), net

Ìý

Ìý

(12,421

)

Ìý

Ìý

(1,190

)

Ìý

Ìý

(13,611

)

Ìý

Ìý

�

Ìý

Ìý

Ìý

(1,383

)

Ìý

Ìý

(14,994

)

Ìý

Ìý

(0.16

)

Unrealized gain (loss), net

Ìý

Ìý

24,059

Ìý

Ìý

Ìý

5,673

Ìý

Ìý

Ìý

29,732

Ìý

Ìý

Ìý

4,408

Ìý

Ìý

Ìý

1,027

Ìý

Ìý

Ìý

35,167

Ìý

Ìý

Ìý

0.38

Ìý

Net change from reverse mortgage loans and HMBS obligations

Ìý

Ìý

�

Ìý

Ìý

Ìý

�

Ìý

Ìý

Ìý

�

Ìý

Ìý

Ìý

29,519

Ìý

Ìý

Ìý

�

Ìý

Ìý

Ìý

29,519

Ìý

Ìý

Ìý

0.32

Ìý

Earnings in unconsolidated entities

Ìý

Ìý

8,304

Ìý

Ìý

Ìý

�

Ìý

Ìý

Ìý

8,304

Ìý

Ìý

Ìý

�

Ìý

Ìý

Ìý

�

Ìý

Ìý

Ìý

8,304

Ìý

Ìý

Ìý

0.09

Ìý

Interest rate hedges and other activity, net(2)

Ìý

Ìý

(5,917

)

Ìý

Ìý

(1,908

)

Ìý

Ìý

(7,825

)

Ìý

Ìý

(12,273

)

Ìý

Ìý

1,284

Ìý

Ìý

Ìý

(18,814

)

Ìý

Ìý

(0.20

)

Credit hedges and other activities, net(3)

Ìý

Ìý

3,616

Ìý

Ìý

Ìý

�

Ìý

Ìý

Ìý

3,616

Ìý

Ìý

Ìý

(394

)

Ìý

Ìý

�

Ìý

Ìý

Ìý

3,222

Ìý

Ìý

Ìý

0.03

Ìý

Income tax (expense) benefit

Ìý

Ìý

�

Ìý

Ìý

Ìý

�

Ìý

Ìý

Ìý

�

Ìý

Ìý

Ìý

�

Ìý

Ìý

Ìý

96

Ìý

Ìý

Ìý

96

Ìý

Ìý

Ìý

�

Ìý

Investment related expenses

Ìý

Ìý

(2,770

)

Ìý

Ìý

�

Ìý

Ìý

Ìý

(2,770

)

Ìý

Ìý

(10,810

)

Ìý

Ìý

�

Ìý

Ìý

Ìý

(13,580

)

Ìý

Ìý

(0.14

)

Other expenses

Ìý

Ìý

(2,259

)

Ìý

Ìý

�

Ìý

Ìý

Ìý

(2,259

)

Ìý

Ìý

(20,756

)

Ìý

Ìý

(15,341

)

Ìý

Ìý

(38,356

)

Ìý

Ìý

(0.41

)

Net income (loss)

Ìý

Ìý

53,186

Ìý

Ìý

Ìý

4,217

Ìý

Ìý

Ìý

57,403

Ìý

Ìý

Ìý

(995

)

Ìý

Ìý

(17,084

)

Ìý

Ìý

39,324

Ìý

Ìý

Ìý

0.43

Ìý

Dividends on preferred stock

Ìý

Ìý

�

Ìý

Ìý

Ìý

�

Ìý

Ìý

Ìý

�

Ìý

Ìý

Ìý

�

Ìý

Ìý

Ìý

(7,035

)

Ìý

Ìý

(7,035

)

Ìý

Ìý

(0.08

)

Net (income) loss attributable to non-participating non-controlling interests

Ìý

Ìý

(316

)

Ìý

Ìý

�

Ìý

Ìý

Ìý

(316

)

Ìý

Ìý

�

Ìý

Ìý

Ìý

(3

)

Ìý

Ìý

(319

)

Ìý

Ìý

�

Ìý

Net income (loss) attributable to common stockholders and participating non-controlling interests

Ìý

Ìý

52,870

Ìý

Ìý

Ìý

4,217

Ìý

Ìý

Ìý

57,087

Ìý

Ìý

Ìý

(995

)

Ìý

Ìý

(24,122

)

Ìý

Ìý

31,970

Ìý

Ìý

Ìý

0.35

Ìý

Net (income) loss attributable to participating non-controlling interests

Ìý

Ìý

�

Ìý

Ìý

Ìý

�

Ìý

Ìý

Ìý

�

Ìý

Ìý

Ìý

�

Ìý

Ìý

Ìý

(321

)

Ìý

Ìý

(321

)

Ìý

Ìý

�

Ìý

Net income (loss) attributable to common stockholders

Ìý

$

52,870

Ìý

Ìý

$

4,217

Ìý

Ìý

$

57,087

Ìý

Ìý

$

(995

)

Ìý

$

(24,443

)

Ìý

$

31,649

Ìý

Ìý

$

0.35

Ìý

Net income (loss) attributable to common stockholders per share of common stock

Ìý

$

0.58

Ìý

Ìý

$

0.05

Ìý

Ìý

$

0.63

Ìý

Ìý

$

(0.01

)

Ìý

$

(0.27

)

Ìý

$

0.35

Ìý

Ìý

Ìý

Weighted average shares of common stock and convertible units(4) outstanding

Ìý

Ìý

Ìý

Ìý

Ìý

Ìý

Ìý

Ìý

Ìý

Ìý

Ìý

Ìý

92,529

Ìý

Ìý

Ìý

Weighted average shares of common stock outstanding

Ìý

Ìý

Ìý

Ìý

Ìý

Ìý

Ìý

Ìý

Ìý

Ìý

Ìý

Ìý

91,601

Ìý

Ìý

Ìý

(1)

Other income primarily consists of rental income on real estate owned, loan origination fees, and servicing income.

(2)

Includes U.S. Treasury securities, if applicable.

(3)

Other activities include certain equity and other trading strategies and related hedges, and net realized and unrealized gains (losses) on foreign currency.

(4)

Convertible units include Operating Partnership units attributable to participating non-controlling interests.

About Ellington Financial

Ellington Financial invests in a diverse array of financial assets, including residential and commercial mortgage loans and mortgage-backed securities, reverse mortgage loans, mortgage servicing rights and related investments, consumer loans, asset-backed securities, collateralized loan obligations, non-mortgage and mortgage-related derivatives, debt and equity investments in loan origination companies, and other strategic investments. Ellington Financial is externally managed and advised by Ellington Financial Management LLC, an affiliate of Ellington Management Group, L.L.C.

Conference Call

We will host a conference call at 11:00 a.m. Eastern Time on Friday, August 8, 2025, to discuss our financial results for the quarter ended June 30, 2025. To participate in the event by telephone, please dial (800) 343-4136 at least 10 minutes prior to the start time and reference the conference ID EFCQ225. International callers should dial (203) 518-9843 and reference the same conference ID. The conference call will also be webcast live over the Internet and can be accessed via the "For Investors" section of our web site at . To listen to the live webcast, please visit at least 15 minutes prior to the start of the call to register, download, and install necessary audio software. In connection with the release of these financial results, we also posted an investor presentation, that will accompany the conference call, on our website at under "For Investors—Presentations."

A dial-in replay of the conference call will be available on Friday, August 8, 2025, at approximately 2:00 p.m. Eastern Time through Friday, August 15, 2025 at approximately 11:59 p.m. Eastern Time. To access this replay, please dial (800) 934-4245. International callers should dial (402) 220-1173. A replay of the conference call will also be archived on our web site at .

Cautionary Statement Regarding Forward-Looking Statements

This release contains forward-looking statements within the meaning of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements involve numerous risks and uncertainties. Our actual results may differ from our beliefs, expectations, estimates, and projections and, consequently, you should not rely on these forward-looking statements as predictions of future events. Forward-looking statements are not historical in nature and can be identified by words such as "believe," "expect," "anticipate," "estimate," "project," "plan," "continue," "intend," "should," "would," "could," "goal," "objective," "will," "may," "seek" or similar expressions or their negative forms, or by references to strategy, plans, or intentions. Forward-looking statements are based on our beliefs, assumptions and expectations of our future operations, business strategies, performance, financial condition, liquidity and prospects, taking into account information currently available to us. These beliefs, assumptions, and expectations are subject to risks and uncertainties and can change as a result of many possible events or factors, not all of which are known to us. If a change occurs, our business, financial condition, liquidity, results of operations and strategies may vary materially from those expressed or implied in our forward-looking statements. The following factors are examples of those that could cause actual results to vary from our forward-looking statements: changes in interest rates and the market value of our investments, market volatility, changes in mortgage default rates and prepayment rates, our ability to borrow to finance our assets, changes in government regulations affecting our business, our ability to maintain our exclusion from registration under the Investment Company Act of 1940, our ability to maintain our qualification as a real estate investment trust, or "REIT," and other changes in market conditions and economic trends, such as changes to fiscal or monetary policy, heightened inflation, slower growth or recession, and currency fluctuations. Furthermore, forward-looking statements are subject to risks and uncertainties, including, among other things, those described under Item 1A of our Annual Report on Form 10-K, which can be accessed through our website at or at the SEC's website (). Other risks, uncertainties, and factors that could cause actual results to differ materially from those projected may be described from time to time in reports we file with the SEC, including reports on Forms 10-Q, 10-K and 8-K. We undertake no obligation to update or revise any forward-looking statements, whether as a result of new information, future events, or otherwise.

This release and the information contained herein do not constitute an offer of any securities or solicitation of an offer to purchase securities.

ELLINGTON FINANCIAL INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(UNAUDITED)

Ìý

Ìý

Three-Month Period Ended

Ìý

Six-Month

Period Ended

Ìý

June 30,
2025

Ìý

March 31,
2025

Ìý

June 30,
2025

(In thousands, except per share amounts)

Ìý

Ìý

Ìý

Ìý

Ìý

NET INTEREST INCOME

Ìý

Ìý

Ìý

Ìý

Ìý

Interest income

$

115,471

Ìý

Ìý

$

115,913

Ìý

Ìý

$

231,384

Ìý

Interest expense

Ìý

(72,128

)

Ìý

Ìý

(72,656

)

Ìý

Ìý

(144,784

)

Total net interest income

Ìý

43,343

Ìý

Ìý

Ìý

43,257

Ìý

Ìý

Ìý

86,600

Ìý

Other Income (Loss)

Ìý

Ìý

Ìý

Ìý

Ìý

AGÕæÈ˹ٷ½ized gains (losses) on securities and loans, net

Ìý

6,911

Ìý

Ìý

Ìý

(8,804

)

Ìý

Ìý

(1,893

)

AGÕæÈ˹ٷ½ized gains (losses) on financial derivatives, net

Ìý

(519

)

Ìý

Ìý

11,641

Ìý

Ìý

Ìý

11,122

Ìý

AGÕæÈ˹ٷ½ized gains (losses) on real estate owned, net

Ìý

(1,356

)

Ìý

Ìý

(934

)

Ìý

Ìý

(2,290

)

AGÕæÈ˹ٷ½ized gains (losses) on unsecured borrowings, at fair value

Ìý

�

Ìý

Ìý

Ìý

(1,383

)

Ìý

Ìý

Unrealized gains (losses) on securities and loans, net

Ìý

59,810

Ìý

Ìý

Ìý

46,108

Ìý

Ìý

Ìý

105,918

Ìý

Unrealized gains (losses) on financial derivatives, net

Ìý

(25,608

)

Ìý

Ìý

(27,115

)

Ìý

Ìý

(52,724

)

Unrealized gains (losses) on real estate owned, net

Ìý

(1,396

)

Ìý

Ìý

(3,311

)

Ìý

Ìý

(4,707

)

Unrealized gains (losses) on other secured borrowings, at fair value, net

Ìý

(25,844

)

Ìý

Ìý

(31,364

)

Ìý

Ìý

(57,208

)

Unrealized gains (losses) on unsecured borrowings, at fair value

Ìý

(1,699

)

Ìý

Ìý

1,027

Ìý

Ìý

Ìý

(673

)

Net change from HECM reverse mortgage loans, at fair value

Ìý

168,817

Ìý

Ìý

Ìý

176,990

Ìý

Ìý

Ìý

345,807

Ìý

Net change related to HMBS obligations, at fair value

Ìý

(142,212

)

Ìý

Ìý

(147,471

)

Ìý

Ìý

(289,682

)

Other, net

Ìý

12,295

Ìý

Ìý

Ìý

24,266

Ìý

Ìý

Ìý

36,563

Ìý

Total other income (loss)

Ìý

49,199

Ìý

Ìý

Ìý

39,650

Ìý

Ìý

Ìý

88,850

Ìý

EXPENSES

Ìý

Ìý

Ìý

Ìý

Ìý

Base management fee to affiliate, net of rebates

Ìý

6,270

Ìý

Ìý

Ìý

6,092

Ìý

Ìý

Ìý

12,362

Ìý

Incentive fee to affiliate

Ìý

�

Ìý

Ìý

Ìý

4,533

Ìý

Ìý

Ìý

4,533

Ìý

Investment related expenses:

Ìý

Ìý

Ìý

Ìý

Ìý

Servicing expense

Ìý

7,220

Ìý

Ìý

Ìý

7,019

Ìý

Ìý

Ìý

14,239

Ìý

Debt issuance costs related to Other secured borrowings, at fair value

Ìý

2,280

Ìý

Ìý

Ìý

�

Ìý

Ìý

Ìý

2,280

Ìý

Other

Ìý

9,147

Ìý

Ìý

Ìý

6,608

Ìý

Ìý

Ìý

15,756

Ìý

Professional fees

Ìý

3,143

Ìý

Ìý

Ìý

3,716

Ìý

Ìý

Ìý

6,860

Ìý

Compensation and benefits

Ìý

21,332

Ìý

Ìý

Ìý

16,942

Ìý

Ìý

Ìý

38,274

Ìý

Other expenses

Ìý

7,674

Ìý

Ìý

Ìý

7,073

Ìý

Ìý

Ìý

14,746

Ìý

Total expenses

Ìý

57,066

Ìý

Ìý

Ìý

51,983

Ìý

Ìý

Ìý

109,050

Ìý

Net Income (Loss) before Income Tax Expense (Benefit) and Earnings from Investments in Unconsolidated Entities

Ìý

35,476

Ìý

Ìý

Ìý

30,924

Ìý

Ìý

Ìý

66,400

Ìý

Income tax expense (benefit)

Ìý

1,475

Ìý

Ìý

Ìý

(96

)

Ìý

Ìý

1,379

Ìý

Earnings (losses) from investments in unconsolidated entities

Ìý

17,072

Ìý

Ìý

Ìý

8,304

Ìý

Ìý

Ìý

25,376

Ìý

Net Income (Loss)

Ìý

51,073

Ìý

Ìý

Ìý

39,324

Ìý

Ìý

Ìý

90,397

Ìý

Net Income (Loss) attributable to non-controlling interests

Ìý

1,114

Ìý

Ìý

Ìý

640

Ìý

Ìý

Ìý

1,754

Ìý

Dividends on preferred stock

Ìý

7,036

Ìý

Ìý

Ìý

7,035

Ìý

Ìý

Ìý

14,071

Ìý

Net Income (Loss) Attributable to Common Stockholders

$

42,923

Ìý

Ìý

$

31,649

Ìý

Ìý

$

74,572

Ìý

Net Income (Loss) per Common Share:

Ìý

Ìý

Ìý

Ìý

Ìý

Basic and Diluted

$

0.45

Ìý

Ìý

$

0.35

Ìý

Ìý

$

0.80

Ìý

Weighted average shares of common stock outstanding

Ìý

95,862

Ìý

Ìý

Ìý

91,601

Ìý

Ìý

Ìý

93,744

Ìý

Weighted average shares of common stock and convertible units outstanding

Ìý

96,995

Ìý

Ìý

Ìý

92,529

Ìý

Ìý

Ìý

94,775

Ìý

ELLINGTON FINANCIAL INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(UNAUDITED)

Ìý

Ìý

As of

(In thousands, except share and per share amounts)

June 30,
2025

Ìý

March 31,
2025

Ìý

December 31,
2024(1)

ASSETS

Ìý

Ìý

Ìý

Ìý

Ìý

Cash and cash equivalents

$

211,013

Ìý

Ìý

$

203,288

Ìý

Ìý

$

192,387

Ìý

Restricted cash

Ìý

19,617

Ìý

Ìý

Ìý

14,027

Ìý

Ìý

Ìý

16,561

Ìý

Securities, at fair value

Ìý

938,454

Ìý

Ìý

Ìý

943,281

Ìý

Ìý

Ìý

962,254

Ìý

Loans, at fair value

Ìý

14,668,365

Ìý

Ìý

Ìý

14,274,158

Ìý

Ìý

Ìý

13,999,572

Ìý

Loan commitments, at fair value

Ìý

8,785

Ìý

Ìý

Ìý

7,215

Ìý

Ìý

Ìý

6,692

Ìý

Forward MSR-related investments, at fair value

Ìý

81,256

Ìý

Ìý

Ìý

87,203

Ìý

Ìý

Ìý

77,848

Ìý

Mortgage servicing rights, at fair value

Ìý

29,276

Ìý

Ìý

Ìý

29,536

Ìý

Ìý

Ìý

29,766

Ìý

Investments in unconsolidated entities, at fair value

Ìý

307,722

Ìý

Ìý

Ìý

269,093

Ìý

Ìý

Ìý

220,078

Ìý

AGÕæÈ˹ٷ½ estate owned

Ìý

48,821

Ìý

Ìý

Ìý

65,447

Ìý

Ìý

Ìý

46,661

Ìý

Financial derivatives–assets, at fair value

Ìý

160,584

Ìý

Ìý

Ìý

157,308

Ìý

Ìý

Ìý

184,395

Ìý

Reverse repurchase agreements

Ìý

348,389

Ìý

Ìý

Ìý

334,145

Ìý

Ìý

Ìý

336,743

Ìý

Due from brokers

Ìý

45,973

Ìý

Ìý

Ìý

43,023

Ìý

Ìý

Ìý

22,186

Ìý

Investment related receivables

Ìý

170,657

Ìý

Ìý

Ìý

184,431

Ìý

Ìý

Ìý

189,081

Ìý

Other assets

Ìý

32,983

Ìý

Ìý

Ìý

32,073

Ìý

Ìý

Ìý

32,804

Ìý

Total Assets

$

17,071,895

Ìý

Ìý

$

16,644,228

Ìý

Ìý

$

16,317,028

Ìý

LIABILITIES

Ìý

Ìý

Ìý

Ìý

Ìý

Securities sold short, at fair value

$

264,511

Ìý

Ìý

$

264,511

Ìý

Ìý

$

293,574

Ìý

Repurchase agreements

Ìý

2,347,458

Ìý

Ìý

Ìý

2,568,627

Ìý

Ìý

Ìý

2,584,040

Ìý

Financial derivatives–liabilities, at fair value

Ìý

81,812

Ìý

Ìý

Ìý

63,149

Ìý

Ìý

Ìý

71,024

Ìý

Due to brokers

Ìý

30,098

Ìý

Ìý

Ìý

53,848

Ìý

Ìý

Ìý

55,429

Ìý

Investment related payables

Ìý

42,767

Ìý

Ìý

Ìý

28,546

Ìý

Ìý

Ìý

22,714

Ìý

Other secured borrowings

Ìý

340,289

Ìý

Ìý

Ìý

268,173

Ìý

Ìý

Ìý

253,300

Ìý

Other secured borrowings, at fair value

Ìý

2,127,225

Ìý

Ìý

Ìý

1,926,711

Ìý

Ìý

Ìý

1,934,309

Ìý

HMBS-related obligations, at fair value

Ìý

9,814,811

Ìý

Ìý

Ìý

9,495,132

Ìý

Ìý

Ìý

9,150,883

Ìý

Unsecured borrowings, at fair value

Ìý

249,036

Ìý

Ìý

Ìý

247,337

Ìý

Ìý

Ìý

281,912

Ìý

Base management fee payable to affiliate

Ìý

6,270

Ìý

Ìý

Ìý

6,092

Ìý

Ìý

Ìý

5,888

Ìý

Incentive fee payable to affiliate

Ìý

�

Ìý

Ìý

Ìý

4,533

Ìý

Ìý

Ìý

�

Ìý

Dividends payable

Ìý

17,495

Ìý

Ìý

Ìý

17,015

Ìý

Ìý

Ìý

16,611

Ìý

Interest payable

Ìý

17,482

Ìý

Ìý

Ìý

20,474

Ìý

Ìý

Ìý

17,956

Ìý

Accrued expenses and other liabilities

Ìý

43,131

Ìý

Ìý

Ìý

42,464

Ìý

Ìý

Ìý

38,566

Ìý

Total Liabilities

Ìý

15,382,385

Ìý

Ìý

Ìý

15,006,612

Ìý

Ìý

Ìý

14,726,206

Ìý

EQUITY

Ìý

Ìý

Ìý

Ìý

Ìý

Preferred stock, par value $0.001 per share, 100,000,000 shares authorized; 13,800,089, 13,800,089, and 13,800,089 shares issued and outstanding, and $345,002, $345,002, and $345,002 aggregate liquidation preference, respectively

Ìý

331,958

Ìý

Ìý

Ìý

331,958

Ìý

Ìý

Ìý

331,958

Ìý

Common stock, par value $0.001 per share, 300,000,000 shares authorized, respectively; 97,891,157, 94,428,880, and 90,678,492 shares issued and outstanding, respectively(2)

Ìý

98

Ìý

Ìý

Ìý

94

Ìý

Ìý

Ìý

91

Ìý

Additional paid-in-capital

Ìý

1,707,544

Ìý

Ìý

Ìý

1,661,528

Ìý

Ìý

Ìý

1,613,540

Ìý

Retained earnings (accumulated deficit)

Ìý

(374,048

)

Ìý

Ìý

(379,316

)

Ìý

Ìý

(375,113

)

Total Stockholders' Equity

Ìý

1,665,552

Ìý

Ìý

Ìý

1,614,264

Ìý

Ìý

Ìý

1,570,476

Ìý

Non-controlling interests

Ìý

23,958

Ìý

Ìý

Ìý

23,352

Ìý

Ìý

Ìý

20,346

Ìý

Total Equity

Ìý

1,689,510

Ìý

Ìý

Ìý

1,637,616

Ìý

Ìý

Ìý

1,590,822

Ìý

TOTAL LIABILITIES AND EQUITY

$

17,071,895

Ìý

Ìý

$

16,644,228

Ìý

Ìý

$

16,317,028

Ìý

SUPPLEMENTAL PER SHARE INFORMATION:

Ìý

Ìý

Ìý

Ìý

Ìý

Book Value Per Common Share (3)

$

13.49

Ìý

Ìý

$

13.44

Ìý

Ìý

$

13.52

Ìý

(1)

Derived from audited financial statements as of December 31, 2024.

(2)

Common shares issued and outstanding at June 30, 2025 includes 3,428,400 shares of common stock issued under our ATM program during the three-month period ended June 30, 2025.

(3)

Based on total stockholders' equity less the aggregate liquidation preference of our preferred stock outstanding.

Reconciliation of Net Income (Loss) to Adjusted Distributable Earnings

We calculate Adjusted Distributable Earnings as U.S. GAAP net income (loss) as adjusted for: (i) realized and unrealized gain (loss) on securities and loans, REO, mortgage servicing rights, financial derivatives (excluding periodic settlements on interest rate swaps), any borrowings carried at fair value, and foreign currency transactions; (ii) incentive fee to affiliate; (iii) Catch-up Amortization Adjustment (as defined below); (iv) non-cash equity compensation expense; (v) provision for income taxes; (vi) certain non-capitalized transaction costs; and (vii) other income or loss items that are of a non-recurring nature. For certain investments in unconsolidated entities, we include the relevant components of net operating income in Adjusted Distributable Earnings. The Catch-up Amortization Adjustment is a quarterly adjustment to premium amortization or discount accretion triggered by changes in actual and projected prepayments on our Agency RMBS (accompanied by a corresponding offsetting adjustment to realized and unrealized gains and losses). The adjustment is calculated as of the beginning of each quarter based on our then-current assumptions about cashflows and prepayments, and can vary significantly from quarter to quarter. Non-capitalized transaction costs include expenses, generally professional fees, incurred in connection with the acquisition of an investment or issuance of long-term debt. We also include in Adjusted Distributable Earnings, for all loans that we originate through Longbridge, any realized and unrealized gains (losses) on such loans up to the point of loan sale or securitization, net of sale or securitization costs.

Adjusted Distributable Earnings is a supplemental non-GAAP financial measure. We believe that the presentation of Adjusted Distributable Earnings provides information useful to investors, because: (i) we believe that it is a useful indicator of both current and projected long-term financial performance, in that it excludes the impact of certain current-period earnings components that we believe are less useful in forecasting long-term performance and dividend-paying ability; (ii) we use it to evaluate the effective net yield provided by our investment portfolio, after the effects of financial leverage and by Longbridge, to reflect the earnings from its reverse mortgage origination and servicing operations; and (iii) we believe that presenting Adjusted Distributable Earnings assists investors in measuring and evaluating our operating performance, and comparing our operating performance to that of our residential mortgage REIT and mortgage originator peers. Please note, however, that: (I) our calculation of Adjusted Distributable Earnings may differ from the calculation of similarly titled non-GAAP financial measures by our peers, with the result that these non-GAAP financial measures might not be directly comparable; and (II) Adjusted Distributable Earnings excludes certain items that may impact the amount of cash that is actually available for distribution.

In addition, because Adjusted Distributable Earnings is an incomplete measure of our financial results and differs from net income (loss) computed in accordance with U.S. GAAP, it should be considered supplementary to, and not as a substitute for, net income (loss) computed in accordance with U.S. GAAP.

Furthermore, Adjusted Distributable Earnings is different from REIT taxable income. As a result, the determination of whether we have met the requirement to distribute at least 90% of our annual REIT taxable income (subject to certain adjustments) to our stockholders, in order to maintain our qualification as a REIT, is not based on whether we distributed 90% of our Adjusted Distributable Earnings.

In setting our dividends, our Board of Directors considers our earnings, liquidity, financial condition, REIT distribution requirements, and financial covenants, along with other factors that the Board of Directors may deem relevant from time to time.

The following table reconciles, for the three-month periods ended June 30, 2025 and March 31, 2025, our Adjusted Distributable Earnings to the line on our Condensed Consolidated Statement of Operations entitled Net Income (Loss), which we believe is the most directly comparable U.S. GAAP measure:

Ìý

Ìý

Three-Month Period Ended

Ìý

Ìý

June 30, 2025

Ìý

March 31, 2025

(In thousands, except per share amounts)

Ìý

Investment
Portfolio

Ìý

Longbridge

Ìý

Corporate/

Other

Ìý

Total

Ìý

Investment
Portfolio

Ìý

Longbridge

Ìý

Corporate/

Other

Ìý

Total

Net Income (Loss)

Ìý

$

57,433

Ìý

Ìý

$

10,681

Ìý

Ìý

$

(17,041

)

Ìý

$

51,073

Ìý

Ìý

$

57,403

Ìý

Ìý

$

(995

)

Ìý

$

(17,084

)

Ìý

$

39,324

Ìý

Income tax expense (benefit)

Ìý

Ìý

�

Ìý

Ìý

Ìý

�

Ìý

Ìý

Ìý

1,475

Ìý

Ìý

Ìý

1,475

Ìý

Ìý

Ìý

�

Ìý

Ìý

Ìý

�

Ìý

Ìý

Ìý

(96

)

Ìý

Ìý

(96

)

Net income (loss) before income tax expense (benefit)

Ìý

Ìý

57,433

Ìý

Ìý

Ìý

10,681

Ìý

Ìý

Ìý

(15,566

)

Ìý

Ìý

52,548

Ìý

Ìý

Ìý

57,403

Ìý

Ìý

Ìý

(995

)

Ìý

Ìý

(17,180

)

Ìý

Ìý

39,228

Ìý

Adjustments:

Ìý

Ìý

Ìý

Ìý

Ìý

Ìý

Ìý

Ìý

Ìý

Ìý

Ìý

Ìý

Ìý

Ìý

Ìý

Ìý

AGÕæÈ˹ٷ½ized (gains) losses, net(1)

Ìý

Ìý

2,099

Ìý

Ìý

Ìý

�

Ìý

Ìý

Ìý

�

Ìý

Ìý

Ìý

2,099

Ìý

Ìý

Ìý

7,448

Ìý

Ìý

Ìý

�

Ìý

Ìý

Ìý

1,382

Ìý

Ìý

Ìý

8,830

Ìý

Unrealized (gains) losses, net(2)

Ìý

Ìý

1,003

Ìý

Ìý

Ìý

6,155

Ìý

Ìý

Ìý

1,293

Ìý

Ìý

Ìý

8,451

Ìý

Ìý

Ìý

(11,346

)

Ìý

Ìý

5,429

Ìý

Ìý

Ìý

(2,772

)

Ìý

Ìý

(8,689

)

Unrealized (gains) losses on reverse MSRs, net of hedging (gains) losses(3)

Ìý

Ìý

�

Ìý

Ìý

Ìý

479

Ìý

Ìý

Ìý

�

Ìý

Ìý

Ìý

479

Ìý

Ìý

Ìý

�

Ìý

Ìý

Ìý

3,869

Ìý

Ìý

Ìý

�

Ìý

Ìý

Ìý

3,869

Ìý

Incentive fee to affiliate

Ìý

Ìý

�

Ìý

Ìý

Ìý

�

Ìý

Ìý

Ìý

�

Ìý

Ìý

Ìý

�

Ìý

Ìý

Ìý

�

Ìý

Ìý

Ìý

�

Ìý

Ìý

Ìý

4,533

Ìý

Ìý

Ìý

4,533

Ìý

Negative (positive) component of interest income represented by Catch-up Amortization Adjustment

Ìý

Ìý

63

Ìý

Ìý

Ìý

�

Ìý

Ìý

Ìý

�

Ìý

Ìý

Ìý

63

Ìý

Ìý

Ìý

(938

)

Ìý

Ìý

�

Ìý

Ìý

Ìý

�

Ìý

Ìý

Ìý

(938

)

Adjustment related to consolidated proprietary reverse mortgage loan securitizations(4)

Ìý

Ìý

�

Ìý

Ìý

Ìý

(5,624

)

Ìý

Ìý

�

Ìý

Ìý

Ìý

(5,624

)

Ìý

Ìý

�

Ìý

Ìý

Ìý

(4,011

)

Ìý

Ìý

�

Ìý

Ìý

Ìý

(4,011

)

Non-capitalized transaction costs and other expense adjustments(5)

Ìý

Ìý

1,803

Ìý

Ìý

Ìý

1,104

Ìý

Ìý

Ìý

224

Ìý

Ìý

Ìý

3,131

Ìý

Ìý

Ìý

1,109

Ìý

Ìý

Ìý

1,669

Ìý

Ìý

Ìý

262

Ìý

Ìý

Ìý

3,040

Ìý

(Earnings) losses from investments in unconsolidated entities

Ìý

Ìý

(17,072

)

Ìý

Ìý

�

Ìý

Ìý

Ìý

�

Ìý

Ìý

Ìý

(17,072

)

Ìý

Ìý

(8,304

)

Ìý

Ìý

�

Ìý

Ìý

Ìý

�

Ìý

Ìý

Ìý

(8,304

)

Adjusted distributable earnings from investments in unconsolidated entities(6)

Ìý

Ìý

9,084

Ìý

Ìý

Ìý

�

Ìý

Ìý

Ìý

�

Ìý

Ìý

Ìý

9,084

Ìý

Ìý

Ìý

5,702

Ìý

Ìý

Ìý

�

Ìý

Ìý

Ìý

�

Ìý

Ìý

Ìý

5,702

Ìý

Total Adjusted Distributable Earnings

Ìý

$

54,413

Ìý

Ìý

$

12,795

Ìý

Ìý

$

(14,049

)

Ìý

$

53,159

Ìý

Ìý

$

51,074

Ìý

Ìý

$

5,961

Ìý

Ìý

$

(13,775

)

Ìý

$

43,260

Ìý

Dividends on preferred stock

Ìý

Ìý

�

Ìý

Ìý

Ìý

�

Ìý

Ìý

Ìý

7,036

Ìý

Ìý

Ìý

7,036

Ìý

Ìý

Ìý

�

Ìý

Ìý

Ìý

�

Ìý

Ìý

Ìý

7,035

Ìý

Ìý

Ìý

7,035

Ìý

Adjusted Distributable Earnings attributable to non-controlling interests

Ìý

Ìý

587

Ìý

Ìý

Ìý

�

Ìý

Ìý

Ìý

532

Ìý

Ìý

Ìý

1,119

Ìý

Ìý

Ìý

373

Ìý

Ìý

Ìý

�

Ìý

Ìý

Ìý

359

Ìý

Ìý

Ìý

732

Ìý

Adjusted Distributable Earnings Attributable to Common Stockholders

Ìý

$

53,826

Ìý

Ìý

$

12,795

Ìý

Ìý

$

(21,617

)

Ìý

$

45,004

Ìý

Ìý

$

50,701

Ìý

Ìý

$

5,961

Ìý

Ìý

$

(21,169

)

Ìý

$

35,493

Ìý

Adjusted Distributable Earnings Attributable to Common Stockholders, per share

Ìý

$

0.56

Ìý

Ìý

$

0.13

Ìý

Ìý

$

(0.22

)

Ìý

$

0.47

Ìý

Ìý

$

0.55

Ìý

Ìý

$

0.07

Ìý

Ìý

$

(0.23

)

Ìý

$

0.39

Ìý

(1)

Includes realized (gains) losses on securities and loans, REO, financial derivatives (excluding periodic settlements on interest rate swaps), and foreign currency transactions which are components of Other Income (Loss) on the Condensed Consolidated Statement of Operations.

(2)

Includes unrealized (gains) losses on securities and loans, REO, financial derivatives (excluding periodic settlements on interest rate swaps), borrowings carried at fair value, MSR-related investments, and foreign currency translations which are components of Other Income (Loss) on the Condensed Consolidated Statement of Operations.

(3)

Represents net change in fair value of the HMBS MSR Equivalent and Reverse MSRs attributable to changes in market conditions and model assumptions. This adjustment also includes net (gains) losses on certain hedging instruments (including interest rate swaps, futures, and short U.S. Treasury securities), which are components of realized and/or unrealized gains (losses) on financial derivatives, net, realized and/or unrealized gains (losses) on securities and loans, net, interest income, and interest expense on the Condensed Consolidated Statement of Operations.

(4)

Represents the effect of replacing mortgage loan interest income (net of securitization debt expense) with interest income of the retained tranches.

(5)

For the three-month period ended June 30, 2025, includes $1.6 million of non-capitalized transaction costs, $1.3 million of non-cash equity compensation and depreciation expense, and $0.2 million of various other expenses. For the three-month period ended March 31, 2025, includes $1.7 million of non-capitalized transaction costs, $0.6 million of non-cash equity compensation and depreciation expense, and $0.7 million of various other expenses.

(6)

Includes the Company's proportionate share of net interest income, net loan origination income (expense), and operating expenses for certain investments in unconsolidated entities, including certain of its non-consolidated equity investments in loan originators that have been making (or are expected to make) distributions to the Company.

Ìý

Investors:

Ellington Financial

Investor Relations

(203) 409-3575

[email protected]



or



Media:

Amanda Shpiner/Grace Cartwright

Gasthalter & Co.

for Ellington Financial

(212) 257-4170

[email protected]

Source: Ellington Financial Inc.

Ellington Financial Inc

NYSE:EFC

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1.22B
91.26M
3.44%
53.74%
5.75%
REIT - Mortgage
AGÕæÈ˹ٷ½ Estate
United States
Greenwich