orc20131010.htm
 
 

 

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549

FORM 8-K

CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934

Date of Report (Date of earliest event reported):  October 10, 2013

Orchid Island Capital, Inc.
(Exact Name of Registrant as Specified in Charter)

Maryland
001-35236
27-3269228
(State or Other Jurisdiction of Incorporation)
(Commission File Number)
(IRS Employer Identification No.)

3305 Flamingo Drive, Vero Beach, Florida 32963
(Address of Principal Executive Offices) (Zip Code)

Registrant’s telephone number, including area code (772) 231-1400

N/A
(Former Name or Former Address, if Changed Since Last Report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

¨
Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

¨
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

¨
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

¨
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))


 
 

 


 
ITEM 8.01.  OTHER EVENTS.

On October 10, 2013, Orchid Island Capital, Inc. (the “Company”) announced that the Board of Directors of the Company declared a dividend for the month of October 2013 of $0.135 per share to be paid on October 31, 2013 to holders of record on October 25, 2013 with an ex-dividend date of October 23, 2013.  In addition, the Company announced the details of its MBS portfolio as of September 30, 2013.  A copy of the Company’s press release announcing the dividend and portfolio summary is attached hereto as Exhibit 99.1 and incorporated herein by this reference.

ITEM 9.01  FINANCIAL STATEMENTS AND EXHIBITS.

(d)  Exhibits
     
99.1
Press Release dated October 10, 2013



 
 

 


 

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

Date: October 11, 2013
        ORCHID ISLAND CAPITAL, INC.
 
     
     
 
By:
 /s/ Robert E. Cauley   
   
Robert E. Cauley
 
   
Chairman and Chief Executive Officer
 
orc20131010x991.htm

ORCHID ISLAND CAPITAL ANNOUNCES
OCTOBER 2013 MONTHLY DIVIDEND AND
SEPTEMBER 30, 2013 MBS PORTFOLIO CHARACTERISTICS

·  
October 2013 Monthly Dividend of $0.135 Per Share
·  
Estimated Book Value Per Share at September 30, 2013 of $13.41
·  
MBS Portfolio Characteristics as of September 30, 2013

Vero Beach, Fla., October 10, 2013 - Orchid Island Capital, Inc. (the “Company”) (NYSE MKT:ORC) announced that today the Board of Directors declared a monthly cash dividend for the month of October 2013. The dividend of $0.135 per share will be paid October 31, 2013, to holders of record on October 25, 2013, with an ex-dividend date of October 23, 2013.

The Company intends to make regular monthly cash distributions to its stockholders. In order to qualify as a real estate investment trust (“REIT”) the Company must distribute annually to its stockholders an amount at least equal to 90% of its REIT taxable income, determined without regard to the deduction for dividends paid and excluding any net capital gain. The Company will be subject to income tax on taxable income that is not distributed and to an excise tax to the extent that certain percentages of its taxable income is not distributed by specified dates. The Company has not established a minimum distribution payment level and is not assured of its ability to make distributions to stockholders in the future.

Estimated September 30, 2013 Book Value Per Share

The Company’s estimated book value per share as of September 30, 2013 was $13.41.  Book value per share is regularly used as a valuation metric by various equity analysts that follow the Company and may be deemed a non-GAAP financial measure pursuant to Regulation G. The Company computes book value per share by dividing total stockholders' equity by the total number of shares outstanding of the Company's Common Stock. At September 30, 2013, the Company's preliminary estimated total stockholders' equity was approximately $44.8 million with 3,341,665 Common shares outstanding. These figures and the resulting estimated book value per share are preliminary, subject to change, and subject to review by the Company’s independent registered public accounting firm.

MBS Portfolio Characteristics

Details of the MBS portfolio as of September 30, 2013 are presented below. These figures are preliminary and subject to change and, with respect to figures that will appear in the Company’s unaudited financial statements and associated footnotes as of and for the three and nine month periods ended September 30, 2013, are subject to  review by the Company’s independent registered public accounting firm.
 
 
·  
MBS Assets by Agency
·  
Investment Company Act of 1940 Whole Pool Test Results
·  
Repurchase agreement exposure by counterparty
·  
MBS Risk Measures

About Orchid Island Capital, Inc.

Orchid Island Capital, Inc. is a specialty finance company that invests in Agency RMBS that are either traditional pass-through Agency RMBS or structured Agency RMBS. Orchid Island Capital, Inc. intends to elect to be taxed as a real estate investment trust for federal income tax purposes.


 
 

 

Forward Looking Statements

This press release contains forward looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 and other federal securities laws. These forward looking statements are based upon Orchid Island Capital, Inc.’s present expectations, but these statements are not guaranteed to occur. Investors should not place undue reliance upon forward looking statements. For further discussion of the factors that could affect outcomes, please refer to the “Risk Factors” section of the Company’s Form 10-K for the year ended December 31, 2012.


MBS Valuation Characteristics
                                   
(in thousands of $s)
                                   
                     
Percentage
   
Weighted
   
Realized
 
   
Current
   
Fair
   
Current
   
of
   
Average
   
Sep 2013 CPR
 
Asset Category
 
Face
   
Value
   
Price
   
Portfolio
   
Coupon
   
(Reported in Oct)
 
As of September 30, 2013
                                   
Adjustable Rate MBS
  $ 5,688     $ 6,150       108.13       1.85 %     4.04 %     0.14 %
10-1 Hybrid Rate MBS
    120,750       120,205       99.55       36.23 %     2.56 %     1.01 %
Hybrid Adjustable Rate MBS
    120,750       120,205       99.55       36.23 %     2.56 %     1.01 %
15 Year Fixed Rate MBS
    22,365       23,189       103.69       6.99 %     3.00 %     3.18 %
20 Year Fixed Rate MBS
    31,197       32,314       103.58       9.74 %     3.50 %     1.74 %
30 Year Fixed Rate MBS
    125,310       129,159       103.07       38.93 %     3.76 %     5.27 %
Total Fixed Rate MBS
    178,872       184,662       103.24       55.66 %     3.62 %     4.39 %
Total Pass-through MBS
    305,310       311,017       101.87       93.74 %     3.22 %     2.98 %
Interest-Only Securities
    114,326       15,371       13.44       4.63 %     4.32 %     19.97 %
Inverse Interest-Only Securities
    41,052       5,399       13.15       1.63 %     5.91 %     20.74 %
Structured MBS
    155,378       20,770       13.37       6.26 %     4.73 %     20.17 %
Total Mortgage Assets
  $ 460,688       331,787       -       100.00 %     3.31 %     8.78 %


MBS Assets by Agency
           
Investment Company Act of 1940 (Whole Pool) Test
 
(in thousands of $s)
           
(in thousands of $s)
           
         
Percentage
           
Percentage
 
   
Fair
   
of
     
Fair
   
of
 
Asset Category
 
Value
   
Portfolio
 
Asset Category
 
Value
   
Portfolio
 
As of September 30, 2013
           
As of September 30, 2013
           
Fannie Mae
  $ 203,477       61.3 %
Whole Pool Assets
  $ 275,066       82.9 %
Freddie Mac
    107,876       32.5 %
Non Whole Pool Assets
    56,721       17.1 %
Ginnie Mae
    20,434       6.2 %
Total Mortgage Assets
  $ 331,787       100.0 %
Total Mortgage Assets
  $ 331,787       100.0 %                  


 
 

 


Repurchase Agreement Exposure By Counterparty
                   
(in thousands of $s)
                   
               
Weighted
   
         
% of
   
Average
   
   
Total
   
Total
   
Maturity
 
Longest
   
Borrowings
   
Debt
   
in Days
 
Maturity
Citigroup Global Markets Inc
  $ 118,674       40.2 %     25  
11/22/2013
South Street Securities, LLC
    48,937       16.6 %     27  
11/5/2013
CRT Capital Group, LLC
    28,740       9.7 %     28  
10/28/2013
The PrinceRidge Group, LLC
    25,847       8.8 %     25  
10/25/2013
Mizuho Securities USA, Inc
    25,442       8.6 %     26  
11/6/2013
Suntrust Robinson Humphry, Inc
    24,532       8.3 %     7  
10/7/2013
Pierpont Securities, LLC
    10,790       3.7 %     16  
10/16/2013
KGS-Alpha Capital Markets, L.P
    7,819       2.6 %     12  
10/25/2013
Cantor Fitzgerald & Co
    4,571       1.5 %     18  
10/18/2013
Total Borrowings
  $ 295,352       100.0 %     23  
11/22/2013

MBS Risk Measures
                                   
(in thousands of $s)
                                   
Mortgage Assets
                                   
         
Weighted
                         
         
Average
   
Weighted
   
Weighted
   
Modeled
   
Modeled
 
         
Months
   
Average
   
Average
   
Interest
   
Interest
 
         
To Next
   
Lifetime
   
Periodic
   
Rate
   
Rate
 
   
Fair
   
Coupon Reset
   
Cap
   
Cap Per Year
   
Sensitivity
   
Sensitivity
 
Asset Category
 
Value
   
(if applicable)
   
(if applicable)
   
(if applicable)
   
(-50 BPS)*
   
(+50 BPS)*
 
As of September 30, 2013
                                   
Adjustable Rate MBS
  $ 6,150       5       10.05 %     2.00 %   $ 62     $ (75 )
Hybrid Adjustable Rate MBS
    120,205       112       7.56 %     2.00 %     2,716       (3,224 )
Total Fixed Rate MBS
    184,662       n/a       n/a       n/a       4,920       (5,557 )
Total Pass-through MBS
    311,017       n/a       n/a       n/a       7,698       (8,856 )
Interest-Only Securities
    15,371       n/a       n/a       n/a       (1,315 )     979  
Inverse Interest-Only Securities
    5,399       1       6.09 %     n/a       52       (235 )
Structured MBS
    20,770       n/a       n/a       n/a       (1,263 )     744  
Total Mortgage Assets
  $ 331,787       n/a       n/a       n/a     $ 6,435     $ (8,112 )
Funding Hedges
                                               
                                   
Modeled
   
Modeled
 
                                   
Interest
   
Interest
 
                           
Hedge
   
Rate
   
Rate
 
                   
Notional
   
Period
   
Sensitivity
   
Sensitivity
 
                   
Balance
   
End Date
   
(-50 BPS)*
   
(+50 BPS)*
 
Eurodollar Futures Contracts - Short Positions
    $ 250,000    
Dec-2018
    $ (5,014 )   $ 5,469  
Grand Total
                                  $ 1,421     $ (2,643 )

*
Modeled results from Citigroup Global Markets, Inc. Yield Book. Interest rate shocks assume instantaneous parallel shifts and horizon prices are calculated assuming constant LIBOR OAS. These results are for illustrative purposes only and actual results may differ materially.

Contact:
Orchid Island Capital, Inc.
Robert E. Cauley
3305 Flamingo Drive, Vero Beach, Florida 32963
Telephone: (772) 231-1400