Dynex Capital, Inc. ("Dynex" or the "Company") (NYSE: DX) has reported its fourth quarter and full year 2024 financial results, with a total economic return of $0.13 per common share for the fourth quarter of 2024 and $0.99 per common share for the full year 2024. The book value per common share was reported at $12.70 as of December 31, 2024.
For the fourth quarter of 2024, comprehensive income was $0.15 per common share and net income was $0.61 per common share. For the full year 2024, comprehensive income was $1.30 per common share and net income was $1.50 per common share. The REIT taxable income for 2024 is estimated at $96 million, including amortization of deferred tax hedge gains.
Dynex raised equity capital of $64.4 million during the fourth quarter through at-the-market ("ATM") common stock issuances, bringing the total capital raised for 2024 to $332.0 million, net of issuance costs. The average balance of interest-earning assets increased by 36% during 2024, with liquidity of $658.3 million as of December 31, 2024.
The leverage, including to-be-announced ("TBA") securities at cost, was reported at 7.9 times shareholders' equity as of December 31, 2024.
Dynex also announced the promotion of T.J. Connelly to Chief Investment Officer, leveraging his 25 years of experience in mortgage-backed securities trading, economic research, and strategy.
The company's interest income continues to rise due to its purchases of higher coupon investments, and the Federal Reserve's interest rate cuts benefited its comprehensive income to common shareholders for the fourth quarter of 2024 by lowering its interest expense related to repurchase agreement borrowings.
The fair value of the company's MBS and TBA investments declined by $(332.4) million in the fourth quarter of 2024 due to the rise in the 10-year U.S. Treasury rate and widened mortgage spreads, but these losses were offset by gains from U.S. Treasury futures and interest rate swaps.
Dynex increased its monthly dividend from $0.13 per common share to $0.15 per common share in November 2024 due to the expected recognition of deferred tax hedge gains of $99.9 million in its distributable REIT taxable income for 2024.
During the fourth quarter of 2024, the company purchased approximately $606.3 million in agency RMBS with coupons of 5.0% and 5.5% and increased its TBA positions by a net $415.0 million.
As of December 31, 2024, the company's interest rate swaps added a benefit of 0.74% to the company's economic net interest spread.
The company's hedging portfolio includes derivative instruments such as interest rate swaps and U.S. Treasury futures, which resulted in a net gain of $276.7 million for the fourth quarter of 2024.
The press release also mentions that the company's executive management will host a call to discuss the results and business outlook.
For more details, the company's conference call details and the full press release can be found on the company's website. The market has reacted to these announcements by moving the company's shares 0.7% to a price of $12.72. For more information, read the company's full 8-K submission here.
