Sachem Capital Reports 31.9% Revenue Decline and Net Loss in Q1 2025

Sachem Capital Corp. reported a significant decline in financial performance for the first quarter of 2025, with total revenues of $11.4 million, down 31.9% from $16.8 million in the same period last year. The decrease in revenue was primarily attributed to a reduction in the unpaid principal balance of loans held for investment, alongside an elevated level of nonperforming loans and real estate owned. Interest income from loans fell to $7.9 million from $12.6 million, while fee income also decreased to $1.4 million from $2.6 million. The company recorded a net loss attributable to common shareholders of $0.2 million, or $0.00 per share, compared to a net income of $3.6 million, or $0.08 per share, in the prior year.

Operating expenses for the quarter were $10.4 million, a decrease of 16.9% from $12.5 million in the previous year. This reduction was largely due to lower interest and amortization costs following the repayment of $58.2 million in unsecured notes in 2024, as well as decreases in compensation and employee benefits. The company’s total assets as of March 31, 2025, were $491.4 million, slightly down from $492.0 million at the end of 2024, primarily due to a $9.4 million decrease in loans held for investment, which was partially offset by a $6.3 million increase in cash.

Sachem Capital's loan portfolio consisted of 143 loans held for investment, with a gross principal amount of $367.9 million. The company reported a significant increase in its allowance for credit losses, which stood at $18.1 million as of March 31, 2025, compared to $18.5 million at the end of 2024. The company also formed a new subsidiary, SN Holdings LLC, to act as the borrower under a new revolving credit facility with Needham Bank, which replaced a previous facility. This new credit agreement, effective March 20, 2025, has a maturity date of March 2, 2026, and includes an option for a one-year extension.

Looking ahead, Sachem Capital anticipates that its current cash balances, along with available debt facilities and projected cash flows from operations, will be sufficient to meet its operational needs over the next 12 months. The company is actively working to address a material weakness in its internal controls related to stock-based compensation, which was identified in its previous annual report. Despite the challenges faced in the first quarter, the company remains focused on its strategic objectives and operational improvements.