Caliber Reports Fourth Quarter and Full Year 2024 Results

2024 Platform revenue increased 1.9% compared to prior year

2024 cost reductions position Caliber for improved 2025

Caliber (NASDAQ:CWD, "CaliberCos Inc.")), a real estate investor, developer, and asset manager, today reported results for the fourth quarter and full year ended December 31, 2024.

Fourth Quarter 2024 (compared to fourth quarter 2023)

• Platform revenue of $4.6 million, compared to $7.2 million
  • Asset management revenue of $4.6 million drove the stated results
  • No significant performance allocations were earned, compared to prior period
• Platform net loss of $11.6 million, or $0.52 per diluted share, compared to Platform net loss of $1.9 million, or $0.09 per diluted share
  • Losses largely impacted by $8.6 million of one-time non-cash allowances and write-downs in accounts receivable and investments, respectively, in the fourth quarter
• Platform Adjusted EBITDA loss of $1.0 million, compared to Platform Adjusted EBITDA of $1.6 million

Full Year 2024 Platform Financial Highlights (compared to full year 2023)

• Platform revenue of $21.0 million, compared to $20.6 million
  • Asset management revenue of $20.6 million drove the stated results
  • Performance allocations of $0.4 million
• Platform net loss of $19.6 million, or $0.89 per diluted share, compared to Platform net loss of $11.8 million, or $0.59 per diluted share
  • Losses largely impacted by $8.6 million of one-time non-cash allowances and write-downs in accounts receivable and investments, respectively, in the fourth quarter
• Platform Adjusted EBITDA loss of $2.7 million, compared to Platform Adjusted EBITDA loss of $1.3 million
• Fair value assets under management ("FV AUM") of $794.9 million, a 7.2% increase compared to December 31, 2023, primarily due to the acquisitions of the West Ridge property in Colorado and Canyon Corporate Plaza property in Arizona, net market appreciation, and construction activity; partially offset by land parcel sales at Johnstown and the sale of a self-storage property
• Managed capital of $492.5 million, a 12.5% increase compared to December 31, 2023, with originations of $69.0 million, partially offset by return of capital of $14.0 million

Management Commentary

"In 2024, we took decisive steps to position Caliber for long-term, sustainable profitability," said Chris Loeffler, CEO of Caliber. "In May, we began implementing operating cost reductions to realign our expense structure with current market dynamics. These efforts began delivering measurable benefits in the second half of the year, with the full $6 million annualized impact expected in 2025."

"Looking ahead, we have refined our strategy to focus on three specific asset classes – hospitality, multi-family and multi-tenant industrial – each of which is well positioned for growth. Additionally, we intend to increase our portfolio of income-producing assets and decrease the number of development projects. We believe this sharper focus will accelerate our path to consistent profitability. In addition, we are seeing early traction in our 1031 exchange program, which offers investors a compelling opportunity to access high-quality, income-generating assets, and we recently closed our first transaction."

"As we exit a challenging period for commercial real estate investment, we believe we are well-positioned to capitalize on emerging opportunities with a leaner expense structure and more narrowly defined objectives that will help us achieve positive net operating income for the full year 2025."

Business Update

The following are key milestones completed both during and subsequent to the fourth quarter ended December 31, 2024.

• On November 26, 2024, Caliber raised capital of $2.0 million from the sale of its series A non-cumulative preferred stock and warrants to one investor.
• On March 17, 2025, Caliber announced it had been qualified by the U.S. Securities and Exchange Commission to offer Series AA Cumulative Preferred Stock to raise up to $20.0 million through the offering of 800,000 shares with an initial stated value of $25.00 per share.
• On March 20, 2025, Caliber entered into a securities purchase agreement with Mast Hill Fund L.P. ("Mast"), issuing a senior secured promissory note worth up to $1,666,666.67, a warrant for 200,000 shares of Class A common stock at $0.75 per share, and 200,000 shares of common stock. Simultaneously, the Company also entered into an equity purchase agreement with Mast to sell up to $25 million of common stock. This agreement also includes a common stock purchase warrant for an additional 200,000 shares at $1.50 per share.
• On March 27, 2025, Caliber announced the launch of the Caliber 1031 Exchange, a full-service program that offers accredited investors access to highly curated real estate investment opportunities, enabling them to defer capital gains while diversifying their portfolios.

Fourth Quarter 2024 Consolidated Financial Results (compared to fourth quarter 2023)

• Total consolidated revenue of $8.7 million, compared to $23.9 million reflecting the deconsolidation of Caliber Hospitality, LP and CHT, in March 2024, and DT Mesa in September 2024
• Consolidated net loss attributable to Caliber of $11.4 million, or $0.51 per diluted share, compared to net loss attributable to Caliber of $2.4 million or $0.11 per diluted share
• Consolidated Adjusted EBITDA of $1.5 million, compared to Consolidated Adjusted EBITDA of $6.5 million

Full Year 2024 Consolidated Financial Results (compared to full year 2023)

• Total consolidated revenue of $51.1 million, compared to $90.9 million reflecting the deconsolidation of Caliber Hospitality, LP and CHT, in March 2024, and DT Mesa in September 2024
• Consolidated net loss attributable to Caliber of $19.8 million, or $0.90 per diluted share, compared to net loss attributable to Caliber of $12.7 million or $0.63 per diluted share
• Consolidated Adjusted EBITDA of $7.0 million, compared to Consolidated Adjusted EBITDA of $10.2 million

Conference Call Information

Caliber will host a conference call today, Monday, March 31, 2025, at 5:00 p.m. Eastern Time (ET) to discuss its fourth quarter and full year 2024 financial results and business outlook. To access this call, dial 1-800-717-1738 (domestic) or 1-646-307-1865 (international). A live webcast of the conference call will be available via the investor relations section of Caliber's website under "Financial Results." The webcast replay of the conference call will be available on Caliber's website shortly after the call concludes.

Platform Financial Highlights

Within this earnings release, we refer to performance results of the ‘Platform'. Platform refers to the performance of CWD itself, excluding the performance of any assets and funds that are included in our consolidated results, as required by the Generally Accepted Accounting Principles ("GAAP"). Management believes that Platform performance offers the most meaningful information needed to understand the value of CWD. The assets and funds that are consolidated into our GAAP presentation are included because Caliber is a guarantor of debt held by these assets and funds.

While GAAP consolidation rules require CWD to include the performance and cash flows of these assets and funds in our consolidated financial information, CWD does not benefit from the performance of those assets and funds, except to the extent that CWD earns fees from managing the assets and funds (which are included in the Platform results). Management believes presenting Platform results, which exclude consolidated assets, directly shows the business performance that CWD stockholders benefit from.

Consolidated Financial Results

Caliber's GAAP consolidated financial statements have been impacted by the deconsolidation of certain variable interest entities' assets, liabilities, revenues, and expenses. These entities were deconsolidated because Caliber was no longer a guarantor on the respective entities' third-party debt. Caliber's GAAP financial metrics are impacted by the timing of deconsolidation. As such, prior periods presented may not be comparable due to the deconsolidation of certain entities in the current period.

About Caliber (CaliberCos Inc.) (NASDAQ:CWD)

With more than $2.9 billion of managed assets, including estimated costs to complete assets under development, Caliber's 15-year track record of managing and developing real estate is built on a singular goal: make money in all market conditions. Our growth is fueled by our performance and our competitive advantage: we invest in projects, strategies, and geographies that global real estate institutions do not. Integral to our competitive advantage is our in-house shared services group, which offers Caliber greater control over our real estate and visibility to future investment opportunities. There are multiple ways to participate in Caliber's success: invest in Nasdaq-listed CaliberCos Inc. and/or invest directly in our Private Funds.

Forward Looking Statements

This press release contains "forward-looking statements" that are subject to substantial risks and uncertainties. All statements, other than statements of historical fact, contained in this press release are forward-looking statements. Forward-looking statements contained in this press release may be identified by the use of words such as "anticipate," "believe," "contemplate," "could," "estimate," "expect," "intend," "seek," "may," "might," "plan," "potential," "predict," "project," "target," "aim," "should," "will" "would," or the negative of these words or other similar expressions, although not all forward-looking statements contain these words. Forward-looking statements are based on the Company's current expectations and are subject to inherent uncertainties, risks and assumptions that are difficult to predict. Further, certain forward-looking statements are based on assumptions as to future events that may not prove to be accurate including, but not limited to, the Company's ability to adequately grow cumulative fundraising, AUM and annualized platform revenue to meet 2026 targeted goals, and the viability of and ability of the Company to adequately access the real estate and capital markets. These and other risks and uncertainties are described more fully in the section titled "Risk Factors" in the final prospectus related to the Company's public offering filed with the SEC and other reports filed with the SEC thereafter. Forward-looking statements contained in this announcement are made as of this date, and the Company undertakes no duty to update such information except as required under applicable law.

NON-GAAP RECONCILIATIONS

(AMOUNTS IN THOUSANDS) (UNAUDITED)

The following information reconciles the performance of the Platform to the consolidated GAAP presentation. Management believes that the Platform view of Caliber's performance is more meaningful to a CWD shareholder as it includes all revenues and expenses generated by Caliber and its wholly-owned subsidiaries.

FVAUM and Managed Capital (UNAUDITED)

The following information summarizes management's estimates of fair value related to the entire portfolio of investments that Caliber manages and the total amount of capital that is being managed across the portfolio. The fair value of our AUM conveys an indication of the overall health of our investments and potentially how much performance allocation Caliber would earn if those assets were sold. Managed Capital is used to evaluate, among other things, the amount of asset management fees we generate from the portfolio.

Consolidated GAAP Results

The following information presents our consolidated GAAP results which includes the performance of certain entities we manage where Caliber is the guarantor of debt owed by those entities, despite not having significant equity at risk. As a result of these guarantor commitments, Caliber is required under GAAP to include the assets, liabilities, revenues and expenses of those entities even though a shareholder of CWD stock is neither entitled to nor exposed by those entities' benefits or obligations. This accounting outcome also removes revenues that we earn from those entities, which a shareholder of CWD stock would be entitled to. See discussion elsewhere related to CWD's Platform performance.

Definitions

Assets Under Management

AUM refers to the assets we manage or sponsor. We monitor two types of information with regard to our AUM:

1. Managed Capital – we define this as the total capital we fundraise from our customers as investments in our funds. It also includes fundraising into our corporate note program, the proceeds of which were used, in part, to invest in or loan to our funds. We use this information to monitor, among other things, the amount of ‘preferred return' that would be paid at the time of a distribution and the potential to earn a performance fee over and above the preferred return at the time of the distribution. Our fund management fees are based on a percentage of managed capital or a percentage of assets under management, and monitoring the change and composition of managed capital provides relevant data points for Caliber management to further calculate and predict future earnings.
2. Fair Value ("FV") AUM – we define this is as the aggregate fair value of the real estate assets we manage and from which we derive management fees, performance revenues and other fees and expense reimbursements. We estimate the value of these assets quarterly to help make sale and hold decisions and to evaluate whether an existing asset would benefit from refinancing or recapitalization. This also gives us insight into the value of our carried interest at any point in time. We also utilize FV AUM to predict the percentage of our portfolio which may need development services in a given year, fund management services (such as refinance), and brokerage services. As we control the decision to hire for these services, our service income is generally predictable based upon our current portfolio AUM and our expectations for AUM growth in the year forecasted.

Non-GAAP Measures

We use non-GAAP financial measures to evaluate operating performance, identify trends, formulate financial projections, make strategic decisions, and for other discretionary purposes. We believe that these measures enhance the understanding of ongoing operations and comparability of current results to prior periods and may be useful for investors to analyze our financial performance because they provide investors a view of the performance attributable to CaliberCos Inc. When analyzing our operating performance, investors should use these measures in addition to, and not as an alternative for, their most directly comparable financial measure calculated and presented in accordance with U.S. GAAP. Our presentation of non-GAAP measures may not be comparable to similarly identified measures of other companies because not all companies use the same calculations. These measures may also differ from the amounts calculated under similarly titled definitions in our debt instruments, which amounts are further adjusted to reflect certain other cash and non-cash charges and are used by us to determine compliance with financial covenants therein and our ability to engage in certain activities, such as incurring additional debt and making certain restricted payments.

Asset Management Platform or Platform

Platform refers to the performance of the Caliber asset management platform, which generates revenues and expenses from managing our investment portfolio, which does not include any consolidated assets or funds. These activities include asset management, transaction services, and performance allocations. Management believes that this is an important view of the Company because it communicates performance of the Company that would be most useful for understanding the value of CWD.

Fee-Related Earnings and Related Components

Fee-Related Earnings is a supplemental non-GAAP performance measure used to assess our ability to generate profits from fee-based revenues, focusing on whether our core revenue streams are sufficient to cover our core operating expenses. Fee-Related Earnings represents the Company's net income (loss) before income taxes adjusted to exclude depreciation and amortization, stock-based compensation, interest expense and extraordinary or non-recurring revenue and expenses, including performance allocation revenue and gain (loss) on extinguishment of debt, public registration direct costs related to aborted or delayed offerings and our Reg A+ offering, the share repurchase costs related to the Company's Buyback Program, litigation settlements, and expenses recorded to earnings relating to investment deals which were abandoned or closed. Fee-Related Earnings is presented on a basis that deconsolidates our consolidated funds (intercompany eliminations) and eliminates noncontrolling interest. Eliminating the impact of consolidated funds and noncontrolling interest provides investors a view of the performance attributable to CaliberCos Inc. and is consistent with performance models and analysis used by management.

Distributable Earnings

Distributable Earnings is a supplemental non-GAAP performance measure equal to Fee-Related Earnings plus performance allocation revenue and less interest expenses and provision for income taxes. We believe that Distributable Earnings can be useful as a supplemental performance measure to our GAAP results assessing the amount of earnings available for distribution.

Platform Earnings

Platform Earnings represents the performance of the Caliber asset management platform, which generates revenues and expenses from managing our investment portfolio, excluding any consolidated assets or funds.

Platform Earnings per Share

Platform Earnings per Share is calculated as Platform Earnings divided by weighted average CWD common shares outstanding.

Platform Adjusted EBITDA

Platform Adjusted EBITDA represents the Company's Distributable Earnings adjusted for interest expense, the share repurchase costs related to the Company's Buyback Program, other income (expense), and provision for income taxes on a basis that deconsolidates our consolidated funds (intercompany eliminations), Loss on CRAF Investment Redemption, Gain on extinguishment of Payroll Protection Program loans, and eliminates noncontrolling interest. Eliminating the impact of consolidated funds and noncontrolling interest provides investors a view of the performance attributable to the CaliberCos Inc. Platform and is consistent with performance models and analysis used by management.

Consolidated Adjusted EBITDA

Consolidated Adjusted EBITDA represents the Company's and the consolidated funds' earnings before net interest expense, income taxes, depreciation and amortization, further adjusted to exclude stock-based compensation, transaction fees, expenses and other public registration direct costs related to aborted or delayed offerings and our Reg A+ offering, the share repurchase costs related to the Company's Buyback Program, litigation settlements, expenses recorded to earnings relating to investment deals which were abandoned or closed, any other non-cash expenses or losses, as further adjusted for extraordinary or non-recurring items.

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Caliber:

Victoria Rotondo

+1 480-295-7600

[email protected]

Investor Relations:

Lisa Fortuna, Financial Profiles

+1 310-622-8251

[email protected]

Media Relations:

Kelly McAndrew, Financial Profiles

+1 310-622-8239

[email protected]