ARMOUR Residential REIT, Inc. (NYSE:ARR) Q2 2023 Earnings Conference Call July 27, 2023 8:00 AM ET
Company Participants
James Mountain - Chief Financial Officer
Scott Ulm - Co-Chief Executive Officer, Head of Risk Management and Co-Vice Chairman
Jeffrey Zimmer - Co-Chief Executive Officer, President and Co-Vice Chairman
Mark Gruber - Chief Investment Officer
Conference Call Participants
Trevor Cranston - JMP Securities LLC
Matthew Erdner - JonesTrading
Christopher Nolan - Ladenburg Thalmann
Matthew Howlett - B. Riley Securities
Operator
Good morning, and welcome to ARMOUR Residential REIT's Second Quarter 2023 Earnings Conference Call. All participants will be in listen-only mode. [Operator Instructions] After today's presentation, there will be an opportunity to ask questions. [Operator Instructions] Please note, this event is being recorded.
I would now like to turn the conference over to Jim Mountain, Chief Financial Officer. Please go ahead.
James Mountain
Thank you, Drew, and thank you to all of you for joining us on our call this morning to discuss ARMOUR's second quarter 2023 results.
With me today are ARMOUR's Co-CEOs, Scott Ulm and Jeff Zimmer; and our CIO, Mark Gruber. By now everyone has access to ARMOUR's earnings release, which can be found on ARMOUR's website, www.armourreit.com.
This conference call includes forward-looking statements, which are intended to be subject to the Safe Harbor protection provided by the Private Securities Litigation Reform Act of 1995. The Risk Factors section of ARMOUR's periodic reports filed with the Securities and Exchange Commission described certain factors beyond ARMOUR's control that could cause actual results to differ materially from those expressed in or implied by these forward-looking statements. Those periodic filings can be found on the SEC's website at www.sec.gov.
All of today's forward-looking statements are subject to change without notice. We disclaim any obligation to update them unless required by law. Also, today's discussion refers to certain non-GAAP measures. These measures are reconciled with comparable GAAP measures in our earnings release. An online replay of this conference call will be available on ARMOUR's website shortly and it will continue for one year.
ARMOUR's Q2 earnings available to common shareholders was $40 million, which includes $43 million of GAAP net income. We sold the last of our legacy available for sale mortgage-backed securities in Q1. Going forward, there will be no mark-to-market items excluded from GAAP net income.
We will continue to report total comprehensive income for comparable prior periods as long as they remain relevant. Net interest income was $5.8 million. Distributable earnings available to common stockholders was $45.4 million or $0.23 per common share. This non-GAAP measure is defined as net interest income plus TBA Drop Income adjusted for the net coupon effective interest rate swaps, less net operating expenses. Our asset yield of 4.24% less net cost of funds of 2.49%, gave us net interest margin of 1.75% for the quarter.