Investment Portfolio - As of December 31, 2024, the investment portfolio consisted of 76.3% in debt investments and 23.7% in equity investments, at cost[164]. - From inception through December 31, 2024, the company has invested approximately $2.0 billion in 62 companies, excluding syndicated loans[169]. - The company exited 32 portfolio companies, generating $332.5 million in net realized gains and $42.0 million in other income, totaling an increase of $374.5 million to net assets[171]. - As of December 31, 2024, unrecognized contractual success fees amounted to $52.8 million, or $1.43 per common share[170]. - The investment strategy focuses on lower middle market private businesses with annual EBITDA of $4 million to $15 million[165]. Financial Performance - Total investment income decreased by $1.7 million, or 7.4%, to $21.4 million for the three months ended December 31, 2024, compared to $23.1 million in the prior year period[182]. - Interest income from debt securities decreased by $1.2 million, or 5.4%, to $20.5 million for the three months ended December 31, 2024[184]. - Total expenses increased by $6.9 million, or 51.5%, to $20.2 million for the three months ended December 31, 2024, primarily due to an increase in incentive fees[190]. - Net investment income fell by $8.6 million, or 88.1%, to $1.2 million for the three months ended December 31, 2024[182]. - The net investment income for the nine months ended December 31, 2024, was $20.9 million, an increase of 26.8% compared to $16.5 million in the prior year[201]. Capital Structure and Financing - The company issued 7.875% 2030 Notes for gross proceeds of $126.5 million during the nine months ended December 31, 2024[172]. - The company has successfully extended the Credit Facility's revolving period to October 2026, with a total commitment amount of $250.0 million[172]. - The company declared monthly cash distributions of $0.08 per common share for January, February, and March 2025, totaling $0.24 for the quarter[178]. - The company anticipates issuing equity securities to obtain additional capital in the future, subject to regulatory constraints when trading below NAV[236]. - The company completed a public offering of the 8.00% 2028 Notes with an aggregate principal amount of $74.8 million, resulting in net proceeds of approximately $72.3 million after deducting underwriting discounts and offering costs of $2.5 million[251][253]. Asset and Liability Management - The asset coverage ratio on senior securities representing indebtedness was 185.9% as of December 31, 2024[176]. - As of December 31, 2024, the company had a net worth of $943.9 million and asset coverage of 185.9% on senior securities representing indebtedness[242]. - The company's total contractual obligations as of December 31, 2024, amounted to $691.8 million, including $463.7 million in notes payable and $136.6 million in interest payments[259]. - The company has line of credit commitments to portfolio companies totaling an aggregate principal of $4.8 million, which are not fully drawn[258]. Investment Income and Expenses - The capital gains-based incentive fee recorded was $7.5 million for the three months ended December 31, 2024, compared to a reversal of $0.6 million in the prior year period[191]. - Total expenses, net of credits from the Adviser, decreased by $2.0 million, or 4.1%, during the nine months ended December 31, 2024, mainly due to a reduction in incentive fees[209]. - The total investment income for the nine months ended December 31, 2024, increased by $2.5 million, or 3.9%, compared to the prior year, driven by higher interest income and dividend and success fee income[203]. Market Performance - The closing market price of the common stock on December 31, 2024, was $13.25 per share, representing a 0.4% discount to the net asset value (NAV) of $13.30 per share[173]. - As of December 31, 2024, the fair value of the investment portfolio exceeded the cost basis by $50.5 million, compared to $13.2 million as of September 30, 2024[199]. - The weighted-average yield on interest-bearing investments was 14.0% for the three months ended December 31, 2024, down from 14.4% in the prior year[186]. Risk Management - The primary risk exposure for the company is interest rate risk, which affects net investment income due to borrowing costs and investment rates[268]. - The average risk rating for loans in the company's portfolio improved from 6.6 in March 2024 to 6.9 in December 2024, with a weighted-average rating increasing from 6.9 to 7.4[264]. - The company targets approximately 90% of loans in its portfolio to be at variable rates, with all variable-rate loans linked to the current 30-day SOFR rate as of December 31, 2024[269].

Acquisition Overview - Proteus Enterprises acquired Ricardo Defense Inc in partnership with Gladstone Investment Corporation [1] - Financial terms of the acquisition were not disclosed [1] Company Profiles Proteus Enterprises - Maryland-based holding company investing in middle and lower middle market aerospace, defense and government services businesses [4] - Focuses on cultivating next generation of middle-tier ADG management teams and companies [4] - Professionals have deep ADG sector experience, providing networks, operational expertise, and strategic insights [4] Ricardo Defense - Engineering services and systems integration company headquartered in Troy, Michigan [5] - Specializes in integrated vehicle engineering solutions for US Department of Defense and prime contractors [5] - Employs approximately 240 individuals as of January 2025, with US operations and some international field services [5] - Industry leader in developing engineering and product solutions for US Army vehicle and logistics programs [2] Strategic Rationale - Ricardo Defense has developed innovative technical solutions including ABS/ESC system for HMMWV [3] - Acquisition brings US ownership and access to capital for Ricardo Defense [3] - Proteus aims to leverage its government services and technology expertise to expand Ricardo's capabilities [3] - Synergy expected between Proteus' investment expertise and Ricardo's technical capabilities [3] Leadership Perspectives - Proteus co-founders highlight Ricardo's experienced leadership team and customer relationships [3] - Ricardo President emphasizes employee achievements and potential for expanded success with Proteus partnership [3] - Incoming CEO of Ricardo Defense expresses excitement about providing mission-critical services to US military [3] Transaction Advisors - Holland & Knight served as legal counsel to Proteus [3] - Squire Patton Boggs served as legal counsel to Ricardo Plc [3] - Houlihan Lokey served as financial advisor to Ricardo Plc [3]

Company and Industry Analysis - The article focuses on the latest exchange-traded debt IPO by Gladstone Investment Corp, specifically the Gladstone Investment Corp 7 875% Notes [1] - The discussion is part of a series of "new issue" oriented articles aimed at active investors [1] - The article invites active investors to join a free trial and participate in a chat room with sophisticated traders and investors [1]

Gladstone Investment (GAIN) came out with quarterly earnings of $0.24 per share, missing the Zacks Consensus Estimate of $0.25 per share. This compares to earnings of $0.24 per share a year ago. These figures are adjusted for non-recurring items.This quarterly report represents an earnings surprise of -4%. A quarter ago, it was expected that this business development company would post earnings of $0.25 per share when it actually produced earnings of $0.24, delivering a surprise of -4%.Over the last four qu ...

Financial Performance - Total investment income for the three months ended September 30, 2024, was $22,565 thousand, an increase of 11.9% compared to $20,277 thousand for the same period in 2023[8]. - Net investment income for the three months ended September 30, 2024, was $7,291 thousand, compared to a loss of $1,730 thousand in the same period last year[8]. - The net increase in net assets resulting from operations for the three months ended September 30, 2024, was $15,482 thousand, down from $47,356 thousand in the prior year[8]. - Basic and diluted net investment income per common share was $0.20 for the three months ended September 30, 2024, compared to a loss of $0.05 in the same period last year[8]. - Total investment return for the three months ended September 30, 2024, was 5.17%, compared to 0.42% for the same period in 2023[10]. - Net investment income increased to $0.20 per share from a loss of $(0.05) per share year-over-year[10]. - Net investment income for the six months ended September 30, 2024, was $19.7 million, representing a 193.7% increase compared to $6.7 million in 2023[203]. Asset and Liability Management - Total assets decreased from $938,083 thousand as of March 31, 2024, to $868,780 thousand as of September 30, 2024, representing a decline of approximately 7.4%[5]. - Total liabilities decreased from $445,372 thousand to $410,405 thousand, a reduction of about 7.8%[5]. - Net assets decreased from $492,711 thousand to $458,375 thousand, reflecting a decline of approximately 6.9%[5]. - The net asset value per share decreased from $13.43 to $12.49, a decline of approximately 7%[5]. - The company maintained a net worth of $789.2 million and asset coverage of 229.3% as of September 30, 2024, in compliance with the Credit Facility covenants[114]. Investment Portfolio - Total investments amounted to $840,147,000 with a fair value of $853,307,000, representing a 186.2% increase[22]. - The company has invested approximately $1.8 billion in 58 companies since its initial public offering in June 2005, excluding syndicated loans[169]. - The investment portfolio as of September 30, 2024, consisted of 77.4% in debt investments and 22.6% in equity investments[163]. - The company has a diversified investment strategy, with significant allocations in sectors such as Chemicals, Plastics, and Rubber, and Telecommunications[22]. - The company’s investments are primarily valued using Level 3 inputs within the fair value hierarchy, indicating a reliance on internal and third-party valuations[22]. Income and Expenses - Total expenses, net of credits to fees, for the three months ended September 30, 2024, were $15,274 thousand, down from $22,007 thousand in the same period last year[8]. - Total expenses decreased by $6.7 million, or 30.6%, to $15.3 million for the three months ended September 30, 2024, primarily due to a reduction in incentive fees[190]. - The total incentive fee for the three months ended September 30, 2024, was $2.2 million, a decrease from $11.5 million in the same period of the previous year[93]. - Interest expense increased by $0.3 million, or 4.8%, to $6.4 million, driven by higher borrowings and an increased effective interest rate of 11.0%[193]. Cash Flow and Distributions - Net cash provided by operating activities was $75,484 for the six months ended September 30, 2024, compared to a net cash used of $(96,585) in the same period of 2023[14]. - The company declared cash distributions of $43.3 million for the six months ended September 30, 2024, with $17.6 million paid during this period and $25.7 million paid in October 2024[141]. - The company reported that 51.0% of cash distributions to common stockholders for the year were from ordinary income, while 49.0% were from capital gains[139]. Debt and Financing - The company has issued 5.00% Notes due 2026 with an aggregate principal amount of $127.9 million, resulting in net proceeds of approximately $123.8 million after costs[121]. - The effective interest rate on borrowings was 11.0% for the three months ended September 30, 2024, compared to 10.9% for the same period in 2023[114]. - The Credit Facility allows for maximum borrowings of $200.0 million, with an outstanding balance of $8.9 million as of September 30, 2024[113]. - The fair value of collateral under the Credit Facility was $648.0 million as of September 30, 2024, down from $717.3 million as of March 31, 2024[119]. Valuation and Fair Value - The Valuation Team employs various techniques, including Total Enterprise Value and Yield Analysis, to determine the fair value of investments[49][51]. - The company engages third-party valuation firms to provide independent assessments of fair value for certain investments[45]. - The fair value of secured first lien debt was $469.5 million as of September 30, 2024, while the fair value of secured second lien debt was $111.3 million[67]. - The fair value of the investment portfolio as of September 30, 2024, was 101.6% of cost, compared to 147.3% as of June 30, 2024[201]. Market Performance - The closing market price of the company's common stock was $14.45 per share on September 30, 2024, representing a 15.7% premium to its net asset value of $12.49 per share[173]. - The company’s common units in Funko are convertible into class A common stock upon meeting certain requirements, with fair value based on the closing market price of Funko, Inc. shares[34].

H re t T == 111 PM Images Written by Nick Ackerman Today, I wanted to give Gladstone Investment (NASDAQ:GAIN) an updated look, as it has been a while. Business development companies ("BDCs") might have been performing strongly in a higher rate environment, but that doesn't mean they still can't deliver some strong yields when rates are cut. We aren't expected to go back to a zero-rate environment, so that should help as well. However, GAIN isn't your usual BDC anyway, it is more of a unique BDC that never r ...

anyaberkut Introduction & Investment Thesis Gladstone Investment (NASDAQ:GAIN) is a business development company (BDC) concentrating on the lower middle market, US entities with EBITDA ranging from $4m to $15m. GAIN remains industry-agnostic; however, its current investment portfolio is oriented around three main sectors: business/consumer services manufacturing consumer products GAIN concentrates on debt investments. As with many BDCs, GAIN's stock price benefited from the high-interest rate environment. C ...

Business development companies (BDCs) typically have high dividend yields, as they are required to distribute substantially all — at least 90% — of their earnings to shareholders. As a result, dividend yields in the sector are usually above 5%. This article will discuss three BDCs with high dividend yields, which could be attractive for income investors. Source: Piotr Swat / Shutterstock The company's dividend policy is somewhat different from others in that it pays a monthly dividend, along with occasional ...

For the quarter ended March 2024, Gladstone Investment (GAIN) reported revenue of $23.65 million, up 19.1% over the same period last year. EPS came in at $0.24, compared to $0.29 in the year-ago quarter.The reported revenue compares to the Zacks Consensus Estimate of $22.94 million, representing a surprise of +3.10%. The company delivered an EPS surprise of -7.69%, with the consensus EPS estimate being $0.26.While investors closely watch year-over-year changes in headline numbers -- revenue and earnings -- ...

Gladstone Investment (GAIN) came out with quarterly earnings of $0.24 per share, missing the Zacks Consensus Estimate of $0.26 per share. This compares to earnings of $0.29 per share a year ago. These figures are adjusted for non-recurring items.This quarterly report represents an earnings surprise of -7.69%. A quarter ago, it was expected that this business development company would post earnings of $0.27 per share when it actually produced earnings of $0.26, delivering a surprise of -3.70%.Over the last f ...