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AFC Gamma Inc. (NASDAQ: AFCG) posted a net loss for the first quarter ending March 31, despite higher revenue as it upped reserves for potential loan losses.

According to filings, revenue climbed 10.4% year-over-year to $12.6 million, reflecting higher rents and lending activity. Funds from operations rose to $10.6 million from $9.5 million in the first quarter of 2023.

AFC Gamma reported a net loss of $54,116 for the period versus a net income of $10 million a year earlier. The Connecticut-based real estate investment trust’s net interest income rose to $14.8 million from $16.8 million in the same period last year.

“We are pleased to have originated a total of $90.4 million of loans in the first quarter of 2024, with $34 million in loans to cannabis operators and $56.4 million to commercial real estate developers,” CEO Daniel Neville said in a statement. “On the cannabis side, we completed a $34 million debt investment in Sunburn Cannabis, a private, vertically integrated single-state Florida operator.”

He added, “The investment underscores our commitment to fostering long-lasting relationships with our borrowers and focusing on limited license states with attractive supply and demand dynamics. Additionally, we are encouraged by the promising legislative developments at both the federal and state level, including the anticipated rescheduling at the federal level and the potential transition to adult-use cannabis in states like Ohio and Florida.”

The results also showed a $4.9 million provision for expected loan losses, up sharply from $702,426 set aside a year ago.

AFC Gamma increased its quarterly dividend to 41 cents per share.

At the end of the period, AFC Gamma’s loan portfolio spanned 108 properties across 19 U.S. states. It funded $7.9 million in additional tenant improvements and acquired a $4 million Connecticut cultivation facility leased to an existing borrower.

The post AFC Gamma posts first-quarter loss despite higher revenue appeared first on Green Market Report.

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Adam Jackson, KahliBuds, 420GrowLife