Bimini Capital Management (OTCMKTS:BMNM) reported higher consolidated net revenue for the first nine months of 2026 as its acquisition of a majority stake in Tom Johnson Investment Management added advisory revenue and helped diversify its business beyond agency residential mortgage-backed securities.
On the company’s third-quarter earnings call Nov. 6, Chairman and CEO Robert Cauley said Bimini was profitable and cash-flow positive year to date. He also said the company was considering paying down trust preferred debt with available cash as it prepares for the eventual expiration of much of its net operating losses, or NOLs.
Consolidated net revenue for the nine months ended Sept. 30 was $18.3 million, up from $12 million in the same period of 2025. Gross investment advisory service revenue rose to approximately $18.6 million from $11.9 million, reflecting growth in Orchid Island Capital’s capital base and two quarters of revenue from Tom Johnson Investment Management, or TJIM, following the April 1 acquisition.
Orchid results reflect difficult fixed-income markets
Cauley described the third quarter as challenging for leveraged residential mortgage-backed securities investors, particularly in late September and early October. He said interest rates reached multidecade highs and implied interest-rate volatility spiked amid persistent inflation, resilient U.S. growth, high energy prices and demand for capital.
Bimini manages Orchid Island Capital through its Bimini Advisors subsidiary, the largest of Bimini’s three operating segments by revenue. Orchid generated an unannualized economic return of negative 12.5% in the third quarter, which Cauley attributed to difficult market conditions.
Orchid’s outstanding share count declined approximately 2.5% as it repurchased shares trading at a discount to book value, Cauley said. Management fees, including overhead allocation and repurchase agreement and clearing fees, declined to $4.95 million from $5.08 million.
Bimini’s investment portfolio generated $420,000 in gross interest and dividend income for the quarter and $280,000 in net interest income after repurchase agreement funding interest. The portfolio was smaller than in prior periods because Bimini sold assets to help fund the TJIM acquisition.
TJIM adds advisory revenue
Bimini’s 80% stake in TJIM generated $1.69 million in advisory service revenue during the third quarter. Cauley called the acquisition transformational, saying it should help make earnings more consistent by diversifying the assets Bimini manages beyond agency residential mortgage-backed securities.
Richard Parry, TJIM’s president and chief investment officer and a Bimini board member, said TJIM had approximately $1.7 billion in assets under management at Sept. 30. That was up from approximately $1.65 billion at the end of 2025 but down from $1.73 billion at June 30.
Parry said TJIM was doing better on the direct advisory side in retention and new business, supported by financial planning activities and its equity performance. He characterized equity performance as strong relative to benchmarks year to date and fixed-income performance as in line with benchmarks. He also said the firm was working with Bimini on efficiencies involving insurance and accounting.
Cauley said the all-cash TJIM transaction required approximately $12.9 million to close and was funded with available cash and proceeds from investment portfolio sales, without incurring additional debt. Bimini ended the third quarter with $10.3 million in cash, including funds held at TJIM, while its investment portfolio had a market value of $14.5 million.
Debt and tax planning
Cauley said Bimini expects that by the end of 2028, all but approximately $5.5 million of the NOLs associated with its former mortgage company will have been used or expired. That amount is expected to fall to approximately $1 million by the end of 2029. Bimini has smaller additional NOLs that do not expire until 2036, he said.
Once the available NOLs are used or expire, Bimini will become a tax-paying entity, Cauley said. He added that paying down trust preferred debt could reduce interest expense and help reshape the balance sheet ahead of the debt’s maturity at the end of 2035.
No analysts or other participants asked questions during the call.
About Bimini Capital Management (OTCMKTS:BMNM)
Bimini Capital Management, Inc is a financial services company focused on the residential mortgage market. Through its subsidiaries, the company invests in residential mortgage-backed securities, primarily agency securities issued or guaranteed by government-sponsored entities such as Fannie Mae and Freddie Mac.
Bimini also provides investment management and corporate services to affiliated entities, including Orchid Island Capital, Inc, a mortgage real estate investment trust. Its activities are centered on the U.S.
