Angel Oak Mortgage, Inc. Q4 FY2025 earnings call

• Fourth quarter and full year results were encouraging with second consecutive year of double-digit net interest income percentage growth and third consecutive year of operating expense reduction. • GAAP book value per share increased due to improving valuations in legacy securitizations and high net interest income. • 2025 had decreasing rates across the curve, securitization markets were healthy with tightening spreads and healthy investor demand. Participated in four securitizations, called two legacy deals, completed first HELOC securitization. Had new warehouse credit facility, completed second issuance of senior unsecured notes. • Addressable market remains significant with structural demand for non-QM solutions. Angel Oak is a leading non-QM platform with differentiated capabilities. • Intend to continue managing leverage and liquidity prudently, emphasize net interest margin and earnings growth, focus on compelling risk-reward segments.

In the fourth quarter, interest income was $39,000,000 and net interest income was $10,900,000, marking a 22% improvement in interest income and a 10% improvement in net interest income compared to 2024. For the full year, interest income was $143,700,000 and net interest income was $41,100,000, with increases of 30% and 11% respectively compared to the prior year. Loan purchases in 2025 were $861,800,000 with a weighted average coupon of 7.79%, weighted average combined loan-to-value ratio of 65.4% and weighted average credit score of 756. The total residential whole loan portfolio had a weighted average coupon of 7.38% at quarter end. Non-QM portion had 7.09% and HELOCs and closed-end seconds had 9.75%. Credit performance was strong with total portfolio weighted average percentage of loans 90-plus days delinquent at 2.18%, a decrease from prior periods. GAAP book value per share increased 1.3% to $10.74 as of 12/31/2025, economic book value was $12.70 per share down 0.2% from prior quarter.

• Expect net interest income to continue growth trend with earnings from accretive loans and ongoing securitization activity. • Book value is modestly increased from December 31. • Believes market will be solid with some pockets of volatility, rates continuing to drop, mortgage rates dropped, generally market solid with volatility. • Anticipate more HELOC securitizations from Angel Oak Mortgage, Inc. franchise, likely more than one to two per year.

Q: Where are you guys seeing the best kind of risk-reward opportunities right now?

A: Think have healthy mix, more relative value in HELOCs with better IRRs, long-term focused on non-QM, both provide healthy returns, careful with HELOC credit underwriting.

Q: Where are you seeing the ROEs on each of those types of securitizations today?

A: Non-QM securitization in mid- to high-teens level, HELOCs at low-20s ROE perspectives.

Q: Did you guys provide a book value update quarter to date?

A: Book value today is modestly increased from where we were at December 31.

Q: Can you talk about your ability to continue to recycle capital, either through calling deals or just optimizing financing?

A: Have good amount of power to recycle, lots of unlevered loans, low recourse debt-to-equity ratio, enough capacity to continue buying clip into 2026.

Q: Where are you seeing the market feels and activity level, especially on non-QM, HELOC, securitization markets?

A: 2025 was solid, 2026 continues with spreads tightening then widening, non-QM market growing with more players, competitive on price, HELOCs have higher ROEs.

Q: How are you guys thinking about this attention across the market right now on private credit, and the impact on other asset managers, and the knock-on effects that it could have on the resi and commercial mortgage markets?

A: See private credit in mortgage space, institutions underinvested in mortgage and ABS, commercial different, spreads range-bound will affect volumes, origination not much affected by spreads in range, steeper yield curve could affect origination towards hybrid mortgages.