Bimini Capital Management Announces First Quarter 2009 Results

-- First Quarter Income from Continuing Operations of $1.9 Million

-- $(1.06) Book Value Deficit Per Share at Quarter End

-- MBS Portfolio Remains 100% Invested in Agency MBS

Bimini Capital Management, Inc. (OTCBB: BMNM | Quote | Chart | News | PowerRating) ("Bimini Capital" or the "Company"), a real estate investment trust ("REIT"), today announced income from continuing operations of $1.9 million, or $0.07 per Class A Common Share, for the three month period ended March 31, 2009, compared with a loss from continuing operations of $0.8 million, or $(0.03) per Class A Common Share, for the three month period ended March 31, 2008. On a consolidated basis, the Company today reported net income of $2.2 million, or $0.08 per Class A Common Share, for the three month period ended March 31, 2009, compared with a net loss of $5.1 million, or $(0.20) per Class A Common Share, for the three month period ended March 31, 2008. Included in the Company's consolidated results were income/(loss) from discontinued operations, net of tax, of $0.2 million and $(4.3) million for the three month periods ended March 31, 2009 and March 31, 2008, respectively.

Book Value (Deficit) Per Share

The Company's Book Value (Deficit) Per Share at March 31, 2009, was $(1.06). Book Value Deficit 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 (Deficit) Per Share by dividing total stockholders' equity by the total number of shares outstanding of the Company's Class A Common Stock. At March 31, 2009, the Company's consolidated stockholders' deficit was $28.7. Please see the Company's Form 10-Q, Note 12, for additional information related to the restructuring of a portion of our trust preferred debt.

Details of First Quarter 2009 Results of Operations

The Company's first quarter income from continuing operations included net interest income of $1.3 million, a realized gain on the sale of mortgage-backed securities ("MBS") of $1.1 million, a net increase in the fair value of MBS of $0.6 million, and $1.1 million in operating, general and administrative expenses. Such expenses include $0.4 million in audit, legal and other professional fees. During the first quarter, the Company sold MBS with a market value of $105.5 million, resulting in the realized gain of $1.1 million.

REIT Taxable Loss

For the three month period ended March 31, 2009, the Company estimates it incurred a loss for REIT tax purposes of $1.4 million, resulting in a cumulative tax net operating loss (NOL) carryforward of $22.5 million. This NOL is available to offset any future REIT taxable income. As of March 31, 2009, the Company has approximately $69.6 million of REIT tax capital loss carryforwards. These tax capital loss carryforwards can only be used to offset any future tax capital gains.

REIT taxable income or loss is a term that describes the Company's operating results calculated in accordance with rules and regulations promulgated pursuant to the Internal Revenue Code (IRC). The Company's REIT taxable income or loss is computed differently from net income as computed in accordance with generally accepted accounting principles ("GAAP net income or loss"), as reported in the Company's consolidated financial statements. Depending on the number and size of the various items or transactions being accounted for differently, the differences between REIT taxable income or loss and GAAP net income or loss can be substantial and each item can affect several reporting periods. Generally, these items are timing or temporary differences between years; for example, an item that may be a recorded under GAAP in the current year may not be recorded under IRC regulations until later years.

In order to maintain its qualification as a REIT, the Company is required (among other provisions) to annually distribute dividends to its stockholders in an amount at least equal to, generally, 90% of the Company's REIT taxable income. Additionally, as a REIT, the Company may be subject to a federal excise tax if it distributes less than 85% of its REIT taxable income by the end of the calendar year. Accordingly, the Company's dividends are largely based on REIT taxable income, as determined for federal income tax purposes as opposed to its net income computed in accordance with GAAP (as reported in the Company's consolidated financial statements), and are paid if and when declared by the Company's Board of Directors.

Management Commentary

Commenting on the Company's first quarter results, Robert E. Cauley, Chairman and Chief Executive Officer, said, "We are pleased to announce an operating profit for the first quarter of 2009, our first operating profit since the fourth quarter of 2007. We believe we are making significant strides to position the Company for recovery and recently completed the debt exchange of one of our trust preferred debt obligations. While the restructuring of half of our trust preferred debt required us to shrink our balance sheet slightly and reduce our borrowing capacity, it will also allow the Company to significantly reduce or eliminate the deficit in shareholder's equity that has burdened us for several quarters. However, there is still much work to be done."

Mr. Cauley continued, "Our profitability in the first quarter was driven by two factors. With funding rates below one percent, our net interest margins were at the widest levels we have experienced in our operating history. Also, by implementing our alternative investment strategy during the third quarter of 2008, we have been able to maintain our gross interest income at levels we would be unable to obtain given our reduced borrowing capacity. We intend to continue with this strategy, at least to some degree, even when and if we regain greater access to repo funding. The strategy has allowed us to leverage our expertise in the analysis of borrower and prepayment characteristics while generating revenue not exposed to the vagaries of the funding market."

Conference Call and Webcast

The Company has scheduled an online Web simulcast and conference call to discuss these announcements that will begin at 8:30 a.m. E.T. tomorrow, Tuesday, May 12, 2009. An online replay will be available approximately two hours following the conclusion of the live broadcast and will continue for 48 hours. A link to these events will be available at the Company's website www.biminicapital.com. Those persons without Internet access may listen to the live call by dialing (888) 561-1799 or (480) 629-9869, Conference ID: 4074406.

About Bimini Capital Management

Bimini Capital Management, Inc. is a REIT that invests primarily in, but is not limited to, residential mortgage-related securities issued by the Federal National Mortgage Association (Fannie Mae), the Federal Home Loan Mortgage Corporation (Freddie Mac) and the Government National Mortgage Association (Ginnie Mae). Its objective is to earn returns on the spread between the yield on its assets and its costs, including the interest expense on the funds it borrows.

Statements herein relating to matters that are not historical facts are forward-looking statements as defined in the Private Securities Litigation Reform Act of 1995. The reader is cautioned that such forward-looking statements are based on information available at the time and on management's good faith belief with respect to future events, and are subject to risks and uncertainties that could cause actual performance or results to differ materially from those expressed in such forward-looking statements. Important factors that could cause such differences are described in Bimini Capital Management, Inc.'s filings with the Securities and Exchange Commission, including Bimini Capital Management, Inc.'s most recent Annual Report on Form 10-K or Quarterly Report on Form 10-Q. Bimini Capital Management, Inc. assumes no obligation to update forward-looking statements to reflect subsequent results, changes in assumptions or changes in other factors affecting forward-looking statements.

SOURCE: Bimini Capital Management, Inc.

Bimini Capital Management, Inc. 
Robert E. Cauley, 772-231-1400 
Chairman and Chief Executive Officer 
www.biminicapital.com