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PennantPark Investment Corporation (PNNT): A Steady Performer in the BDC Space
Insider Monkey· 2025-10-07 04:59
Core Insights - Artificial intelligence (AI) is identified as the greatest investment opportunity of the current era, with a strong emphasis on the urgent need for energy to support its growth [1][2][3] - A specific company is highlighted as a key player in the AI energy sector, owning critical energy infrastructure assets that are essential for meeting the increasing energy demands of AI technologies [3][7][8] Investment Landscape - Wall Street is investing hundreds of billions into AI, but there is a looming question regarding the energy supply needed to sustain this growth [2] - AI data centers, such as those powering large language models, consume energy equivalent to that of a small city, indicating a significant strain on global power grids [2] - The company in focus is positioned to benefit from the surge in demand for electricity driven by AI, making it a unique investment opportunity [3][6] Company Profile - The company is described as a "toll booth" operator in the AI energy boom, collecting fees from energy exports and benefiting from the onshoring trend due to tariffs [5][6] - It possesses critical nuclear energy infrastructure assets, making it integral to America's future power strategy [7] - The company is noted for its ability to execute large-scale engineering, procurement, and construction projects across various energy sectors, including oil, gas, and renewables [7] Financial Position - The company is completely debt-free and has a significant cash reserve, amounting to nearly one-third of its market capitalization, which positions it favorably compared to other energy firms burdened by debt [8][10] - It also holds a substantial equity stake in another AI-related company, providing indirect exposure to multiple growth engines in the AI sector [9] Market Sentiment - There is a growing interest from hedge funds in this company, which is considered undervalued and off-the-radar, trading at less than 7 times earnings excluding cash and investments [10][11] - The company is recognized for delivering real cash flows and owning critical infrastructure, making it a compelling investment choice in the context of the AI revolution [11][12] Future Outlook - The article emphasizes the importance of being part of the AI investment wave, suggesting that companies embracing AI will thrive while those resistant to change will falter [11][12] - The potential for significant returns is highlighted, with expectations of over 100% returns within 12 to 24 months for investors who act now [15]
11 Best BDC Stocks to Buy Now
Insider Monkey· 2025-10-06 17:18
In this article, we will take a look at some of the best BDC dividend stocks to invest in.Business Development Companies, or BDCs, play a key role in fueling the growth of smaller and mid-sized businesses across the US. Instead of relying on traditional banking models, they gather funds from investors by issuing shares and then channel that capital into a mix of loans and equity stakes in private firms. The idea is simple — to give these growing companies the financial boost they need to expand and thrive, ...
PennantPark Investment Corporation Schedules Earnings Release of Fourth Fiscal Quarter 2025 Results
Globenewswire· 2025-10-03 20:05
MIAMI, Oct. 03, 2025 (GLOBE NEWSWIRE) -- PennantPark Investment Corporation (the "Company") (NYSE: PNNT) announced that it will report results for the fourth fiscal quarter ended September 30, 2025 on Monday, November 24, 2025 after the close of the financial markets. The Company will also host a conference call at 12:00 p.m. (Eastern Time) on Tuesday, November 25, 2025 to discuss its financial results. All interested parties are welcome to participate. You can access the conference call by dialing toll-fre ...
PennantPark Investment: Limited Growth Potential Until Rates Are Cut
Seeking Alpha· 2025-08-26 12:39
Company Overview - PennantPark Investment (NYSE: PNNT) operates as a business development company focused on generating earnings from a diverse portfolio of debt investments [1] Investment Strategy - The company aims to lend capital to various sectors, utilizing a hybrid investment strategy that combines classic dividend growth stocks with Business Development Companies, REITs, and Closed End Funds to enhance investment income [1] Performance Insights - The investment approach is designed to achieve a total return that is competitive with traditional index funds, specifically targeting returns on par with the S&P [1]
PennantPark Investment Corporation (PNNT) Q3 2025 Earnings Conference Call Transcript
Seeking Alpha· 2025-08-12 18:04
Core Points - PennantPark Investment Corporation held its Q3 2025 earnings conference call on August 12, 2025, with key participants including the CEO and CFO [1][2][3] - The call was initiated by the CEO, Arthur Howard Penn, who welcomed participants and introduced the CFO for further disclosures [3][4] Company Information - The conference call was recorded and is considered the property of PennantPark Investment Corporation, with an audio replay available on the company's website [4] - The CFO, Richard Thomas Allorto, provided general information about the call and mentioned the customary safe harbor disclosure regarding forward-looking statements [4][5]
PennantPark Investment (PNNT) - 2025 Q3 - Earnings Call Transcript
2025-08-12 17:00
Financial Data and Key Metrics Changes - For the quarter ended June 30, core net investment income was $0.18 per share, compared to total distributions of $0.24 per share [5][17] - As of June 30, net asset value (NAV) was $7.36 per share, down 1.6% from $7.48 per share in the prior quarter [18] - The debt to equity ratio was 1.3 times as of June 30 [18] Business Line Data and Key Metrics Changes - The portfolio consisted of 158 companies across 37 different industries, with a weighted average yield on debt investments of 11.5% [19] - The portfolio's weighted average leverage ratio was 4.7 times, and the interest coverage ratio was 2.5 times [19] - The company invested $88 million in four new and 28 existing portfolio companies at a weighted average yield of 10% during the quarter [14] Market Data and Key Metrics Changes - In the core middle market, pricing for first lien term loans was between $4.75 to $5.25 for high-quality assets [7] - The weighted average debt to EBITDA for new investments was 3.8 times, with an interest coverage of 2.6 times [7][33] - The company continues to see attractive investments in the core middle market, characterized by lower leverage and higher spreads compared to the upper middle market [8][10] Company Strategy and Development Direction - The company plans to rotate out of equity positions and redeploy that capital into interest-paying debt investments to increase core net investment income [6] - The focus remains on providing strategic capital to middle market companies in five key sectors: business services, consumer, government services and defense, healthcare, and software and technology [10] - The company aims to deliver compelling risk-adjusted returns through stable income generation and long-term capital preservation [16] Management's Comments on Operating Environment and Future Outlook - Management is encouraged by a resurgence in deal activity, anticipating increased loan originations and potential exits from equity positions [5] - The company expects significant progress in equity rotation over the next twelve to eighteen months, depending on market conditions [22][29] - Management remains optimistic about the credit quality of the portfolio, with a strong track record of generating value from investments [12][13] Other Important Information - The company has a significant balance of spillover income of $55 million, or $0.84 per share, which can cover shortfalls in core net investment income [6] - The joint venture (JV) portfolio totaled $1.3 billion as of June 30, contributing significantly to core net investment income [14] - The JV has the capacity to increase its portfolio to $1.6 billion, which is expected to enhance earnings momentum in future quarters [15] Q&A Session Summary Question: What is the timeline for selling a portion of the equity portfolio and reinvesting that capital? - Management anticipates significant progress in rotating out of equity positions over the next twelve to eighteen months, aiming to reinvest capital into yields to generate healthy net investment income for shareholders [22][24] Question: What is the expectation for leverage once a meaningful portion of the equity portfolio is rotated into first lien loans? - Management indicated that a heavier first lien portfolio could judiciously handle a bit more leverage, suggesting that leverage targets may move higher [25][26] Question: At what point would the company evaluate the dividend concerning spillover income? - Management stated that once the portfolio normalizes, they would assess the sustainability of the dividend based on the remaining spillover income [29][30] Question: How is the competitive environment in the middle market affecting pricing and covenants? - Management noted that competition remains rational in the core middle market, with continued access to covenants and monthly financial statements, which helps in maintaining a strong underwriting process [49][51] Question: What is the outlook for the joint venture and its optimization? - Management believes that the JV can be fully optimized in the next six to nine months, with potential for further growth [44][45]
PennantPark (PNNT) Q3 Earnings Meet Estimates
ZACKS· 2025-08-12 00:01
分组1 - PennantPark reported quarterly earnings of $0.18 per share, matching the Zacks Consensus Estimate, but down from $0.24 per share a year ago [1] - The company posted revenues of $29.56 million for the quarter ended June 2025, missing the Zacks Consensus Estimate by 0.3% and down from $37 million year-over-year [2] - Over the last four quarters, PennantPark has not surpassed consensus EPS estimates and has topped consensus revenue estimates only once [2][6] 分组2 - The stock has gained approximately 2.7% since the beginning of the year, compared to the S&P 500's gain of 8.6% [3] - The current consensus EPS estimate for the upcoming quarter is $0.18 on revenues of $29.71 million, and for the current fiscal year, it is $0.74 on revenues of $124.23 million [7] - The Financial - SBIC & Commercial Industry is currently in the bottom 32% of Zacks industries, indicating potential challenges for stocks in this sector [8]
PennantPark Investment (PNNT) - 2025 Q3 - Quarterly Report
2025-08-11 20:06
PART I. CONSOLIDATED FINANCIAL INFORMATION [Item 1. Consolidated Financial Statements](index=4&type=section&id=Item%201.%20Consolidated%20Financial%20Statements) Presents PennantPark's unaudited consolidated financial statements for Q2 2025, covering key financial statements and investment schedules, with auditor review [Consolidated Statements of Assets and Liabilities](index=4&type=section&id=Consolidated%20Statements%20of%20Assets%20and%20Liabilities) Total assets and liabilities decreased as of June 30, 2025, leading to a decline in total net assets to **$480.6 million** and NAV per share to **$7.36** Consolidated Balance Sheet Highlights (in thousands, except per share data) | Metric | June 30, 2025 (unaudited) | September 30, 2024 | | :--- | :--- | :--- | | Total Investments at Fair Value | $1,171,624 | $1,328,050 | | Total Assets | $1,252,888 | $1,389,086 | | Total Liabilities | $772,303 | $895,178 | | **Total Net Assets** | **$480,585** | **$493,908** | | **Net Asset Value per Share** | **$7.36** | **$7.56** | [Consolidated Statements of Operations](index=5&type=section&id=Consolidated%20Statements%20of%20Operations) Net investment income for Q2 2025 decreased to **$11.8 million** ($0.18/share), while net assets from operations increased to **$8.2 million** due to lower losses Statement of Operations Summary (in thousands, except per share data) | Metric | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Nine Months Ended June 30, 2025 | Nine Months Ended June 30, 2024 | | :--- | :--- | :--- | :--- | :--- | | Total Investment Income | $29,555 | $37,004 | $94,423 | $107,318 | | Net Expenses | $17,757 | $21,258 | $58,204 | $61,661 | | **Net Investment Income** | **$11,798** | **$15,746** | **$36,219** | **$45,657** | | Net Realized & Unrealized Loss | $(3,648) | $(12,000) | $(2,529) | $(15,173) | | **Net Increase in Net Assets** | **$8,150** | **$3,746** | **$33,690** | **$30,484** | | Net Investment Income per Share | $0.18 | $0.24 | $0.55 | $0.70 | | Net Increase in Net Assets per Share | $0.12 | $0.06 | $0.52 | $0.47 | [Consolidated Statements of Changes in Net Assets](index=6&type=section&id=Consolidated%20Statements%20of%20Changes%20in%20Net%20Assets) Net assets decreased by **$13.3 million** for the nine months ended June 30, 2025, primarily due to stockholder distributions exceeding operational increases - Net assets decreased from **$493.9 million** to **$480.6 million** for the nine months ended June 30, 2025[16](index=16&type=chunk) - Distributions to stockholders of **$47.0 million** were the primary driver for the net asset decrease, surpassing the **$33.7 million** net increase from operations[16](index=16&type=chunk) [Consolidated Statements of Cash Flows](index=7&type=section&id=Consolidated%20Statements%20of%20Cash%20Flows) Net cash provided by operating activities was **$212.6 million** for the nine months ended June 30, 2025, leading to a **$20.7 million** increase in cash and equivalents Cash Flow Summary (in thousands) | Cash Flow Activity | Nine Months Ended June 30, 2025 | Nine Months Ended June 30, 2024 | | :--- | :--- | :--- | | Net Cash from Operating Activities | $212,562 | $(167,739) | | Net Cash from Financing Activities | $(192,014) | $188,116 | | **Net Increase in Cash** | **$20,548** | **$20,377** | | Cash and Cash Equivalents, End of Period | $70,546 | $59,152 | [Consolidated Schedules of Investments](index=8&type=section&id=Consolidated%20Schedules%20of%20Investments) The investment portfolio totaled **$1.17 billion** as of June 30, 2025, diversified across debt and equity, with first lien secured debt as a primary component Portfolio Composition by Investment Type (June 30, 2025) | Investment Type | Fair Value ($ thousands) | % of Net Assets | | :--- | :--- | :--- | | First Lien Secured Debt | $476,461 | 84.3% | | Second Lien Secured Debt | $18,011 | 3.7% | | Subordinate Debt/Corporate Notes | $53,884 | 6.4% | | Preferred Equity/Partnership Interests | $284,954 | 3.9% | | Common Equity/Partnership Interests/Warrants | $132,039 | 27.5% | | U.S. Government Securities | $124,697 | 25.9% | | **Total Investments** | **$1,171,624** | **243.8%** | - The portfolio is categorized into non-controlled non-affiliated (**$729.8 million**), non-controlled affiliated (**$7.5 million**), and controlled affiliated (**$434.4 million**) investments[12](index=12&type=chunk)[43](index=43&type=chunk)[46](index=46&type=chunk) [Notes to Consolidated Financial Statements (unaudited)](index=28&type=section&id=Notes%20to%20Consolidated%20Financial%20Statements%20(unaudited)) Provides detailed explanations of the company's organization, accounting policies, related party transactions, investment valuation, and debt structure - **Organization:** PennantPark is a BDC investing primarily in U.S. middle-market companies through debt and equity, externally managed by PennantPark Investment Advisers, LLC[85](index=85&type=chunk) - **Accounting Policies:** Financial statements adhere to GAAP (ASC 946), with illiquid investments valued by the board; four portfolio companies were on non-accrual status as of June 30, 2025[93](index=93&type=chunk)[96](index=96&type=chunk)[100](index=100&type=chunk) - **Related Party Transactions:** The Investment Adviser receives a base management fee (1.50% on average adjusted gross assets, reduced to 1.00% on assets exceeding 200% of net assets) and a two-part incentive fee[126](index=126&type=chunk)[127](index=127&type=chunk)[128](index=128&type=chunk) - **Debt:** The company maintains a **$500 million** Truist Credit Facility and **$315 million** in unsecured notes, with an asset coverage ratio of **176%** as of June 30, 2025[198](index=198&type=chunk)[200](index=200&type=chunk)[201](index=201&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=50&type=section&id=Item%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses financial condition and operational results, noting decreased investment income due to a smaller portfolio and lower yields, covering portfolio, operations, and liquidity [Portfolio and Investment Activity](index=52&type=section&id=Portfolio%20and%20Investment%20Activity) The portfolio value decreased to **$1.17 billion** as of June 30, 2025, with a lower weighted average yield and significant investment activity Portfolio Summary | Metric | June 30, 2025 | September 30, 2024 | | :--- | :--- | :--- | | Total Portfolio Value | $1,171.6M | $1,328.1M | | Number of Portfolio Companies | 158 | 152 | | Weighted Avg. Yield on Debt | 11.5% | 12.3% | | Non-Accrual (Cost Basis) | 2.8% | 4.1% | | Non-Accrual (Fair Value) | 0.7% | 2.3% | - For the nine months ended June 30, 2025, investment activity included **$560.2 million** in new and existing investments and **$749.0 million** in sales and repayments, with **$462.8 million** sold to the PSLF joint venture[236](index=236&type=chunk) [Results of Operations](index=56&type=section&id=Results%20of%20Operations) Investment income and net investment income decreased for Q2 2025, while the net increase in net assets from operations improved due to lower losses - Investment income for the nine months ended June 30, 2025, decreased to **$94.4 million** from **$107.3 million**, driven by a smaller portfolio and lower weighted average yield[272](index=272&type=chunk) - Expenses for the nine months ended June 30, 2025, decreased to **$58.2 million** from **$61.7 million**, primarily due to lower interest expenses and incentive fees[273](index=273&type=chunk) - Net investment income for the nine months ended June 30, 2025, was **$36.2 million** (**$0.55** per share), a decrease from **$45.7 million** (**$0.70** per share) in 2024[274](index=274&type=chunk) [Liquidity and Capital Resources](index=57&type=section&id=Liquidity%20and%20Capital%20Resources) Liquidity is supported by operations and debt financings, with **$70.5 million** in cash and a **176%** asset coverage ratio as of June 30, 2025 - As of June 30, 2025, the company held **$70.5 million** in cash and equivalents and **$183.5 million** in unused borrowing capacity under its Truist Credit Facility[282](index=282&type=chunk)[291](index=291&type=chunk) - The asset coverage ratio stood at **176%** as of June 30, 2025, exceeding the **150%** regulatory minimum[281](index=281&type=chunk) - Cash from operations for the nine months ended June 30, 2025, was **$212.6 million**, a significant improvement from **$167.7 million** used in the prior year, driven by higher investment sales proceeds[292](index=292&type=chunk)[293](index=293&type=chunk) [Item 3. Quantitative and Qualitative Disclosures About Market Risk](index=66&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) The company faces market risk primarily from interest rate changes, with **90%** of its debt portfolio in variable-rate investments, impacting net investment income - As of June 30, 2025, **90%** of the company's debt portfolio consists of variable-rate investments, making its income sensitive to interest rate fluctuations[324](index=324&type=chunk) Annualized Impact of Hypothetical Interest Rate Changes | Change in Interest Rates | Change in Net Interest Income (in thousands) | Change in Net Interest Income Per Share | | :--- | :--- | :--- | | Down 1% | $(3,044) | $(0.05) | | Up 1% | $3,044 | $0.05 | | Up 2% | $6,088 | $0.09 | | Up 3% | $9,132 | $0.14 | [Item 4. Controls and Procedures](index=67&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded that disclosure controls and procedures were effective as of June 30, 2025, with no material changes to internal control - The CEO and CFO affirmed the effectiveness of the company's disclosure controls and procedures as of June 30, 2025[329](index=329&type=chunk) - No material changes to internal control over financial reporting occurred during the quarter[330](index=330&type=chunk) PART II. OTHER INFORMATION [Item 1. Legal Proceedings](index=68&type=section&id=Item%201.%20Legal%20Proceedings) No material legal proceedings are currently pending against the company, its Investment Adviser, or Administrator - No material legal proceedings are currently against the company, its Investment Adviser, or Administrator[331](index=331&type=chunk) [Item 1A. Risk Factors](index=68&type=section&id=Item%201A.%20Risk%20Factors) Key risks include potential negative impacts from changes in U.S. trade policies and significant cybersecurity threats to systems and data - Changes to U.S. trade policies and tariffs could adversely affect portfolio companies' performance by increasing costs or reducing demand[333](index=333&type=chunk) - Significant cybersecurity risks, including data breaches and system failures, could impact operations and financial results despite mitigation efforts[334](index=334&type=chunk)[335](index=335&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=68&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) No unregistered sales of equity securities occurred during the reporting period - None[337](index=337&type=chunk) [Item 3. Defaults Upon Senior Securities](index=68&type=section&id=Item%203.%20Defaults%20Upon%20Senior%20Securities) No defaults upon senior securities occurred during the reporting period - None[337](index=337&type=chunk) [Item 5. Other Information](index=68&type=section&id=Item%205.%20Other%20Information) No other information is reported for the period - None[339](index=339&type=chunk) [Item 6. Exhibits](index=69&type=section&id=Item%206.%20Exhibits) Lists exhibits filed with Form 10-Q, including CEO/CFO certifications and Inline XBRL data files - Exhibits filed include CEO and CFO certifications (Rule 13a-14 and Section 906) and Inline XBRL documents[341](index=341&type=chunk)
PennantPark Investment (PNNT) - 2025 Q3 - Quarterly Results
2025-08-11 20:06
[Financial Highlights](index=1&type=section&id=Financial%20Highlights) The company's financial position as of June 30, 2025, shows a portfolio of $1.1716 billion and net assets of $480.6 million, with a quarterly decrease in NAV per share | Metric | June 30, 2025 | | :--- | :--- | | **Assets and Liabilities:** | | | Investment Portfolio | $1.1716 billion | | Net Assets | $480.6 million | | Net Asset Value per Share | $7.36 | | Quarterly Change in NAV per Share | -1.6% | | Weighted Average Yield on Debt Investments | 11.5% | | **Operating Performance:** | | | Net Investment Income | $11.8 million | | Net Investment Income per Share | $0.18 | | Core Net Investment Income per Share | $0.18 | | Declared Dividends per Share | $0.24 | | **Portfolio Activity:** | | | Investment Purchases | $87.7 million | | Investment Sales and Repayments | $132.2 million | [Portfolio and Investment Activity](index=2&type=section&id=Portfolio%20and%20Investment%20Activity) This section details the company's investment strategy, portfolio composition, quality, and recent investment activities, including the PennantPark Senior Loan Fund [Management Commentary](index=2&type=section&id=Management%20Commentary) The company's management is encouraged by the recovery in recent transaction activity, anticipating increased new loan originations and potential equity exits, while strategically rotating equity into debt to boost core net investment income - The company's strategic focus is to rotate equity positions into debt investments to drive growth in **Core Net Investment Income (Core NII)**[6](index=6&type=chunk) - Management will continue to utilize substantial **spillover income** to cover any shortfalls between Core Net Investment Income and dividends[6](index=6&type=chunk) [Portfolio Composition and Quality](index=2&type=section&id=Portfolio%20Composition%20and%20Quality) As of June 30, 2025, the total investment portfolio decreased to $1.1716 billion, with a shift from first lien secured debt to preferred and common equity, and an increase in non-accrual companies Portfolio Composition | Portfolio Composition | June 30, 2025 | September 30, 2024 | | :--- | :--- | :--- | | Total Investment Portfolio | $1.1716 billion | $1.3281 billion | | First Lien Secured Debt | 41% | 50% | | Second Lien Secured Debt | 1% | 5% | | Subordinated Debt | 16% | 14% | | Preferred and Common Equity | 31% | 23% | | U.S. Government Securities | 11% | 8% | Portfolio Quality Metrics | Portfolio Quality Metrics | June 30, 2025 | September 30, 2024 | | :--- | :--- | :--- | | Weighted Average Yield on Debt Investments | 11.5% | 12.3% | | Number of Non-Accrual Companies | 4 | 2 | | Non-Accrual Investments (Fair Value % of Total Portfolio) | 0.7% | 2.3% | | Total Portfolio Companies | 158 | 152 | [Investment Activity](index=2&type=section&id=Investment%20Activity) Investment activity for the three and nine months ended June 30, 2025, shows a decrease in investments made and an increase in sales and repayments compared to the prior year Investment Activity (Three Months Ended June 30) | Investment Activity (Three Months Ended June 30) | 2025 | 2024 | | :--- | :--- | :--- | | Investments Made | $87.7 million | $163.1 million | | Sales and Repayments | $132.2 million | $132.9 million | | Weighted Average Yield on New Investments | 10.0% | 12.0% | Investment Activity (Nine Months Ended June 30) | Investment Activity (Nine Months Ended June 30) | 2025 | 2024 | | :--- | :--- | :--- | | Investments Made | $560.2 million | $752.1 million | | Sales and Repayments | $749.0 million | $380.1 million | [PennantPark Senior Loan Fund (PSLF)](index=2&type=section&id=PennantPark%20Senior%20Loan%20Fund%20(PSLF)) The PSLF's total investment portfolio increased to $1.3391 billion as of June 30, 2025, despite a decrease in investments made and an increase in sales and repayments during the quarter PSLF Portfolio Overview | PSLF Portfolio Overview | June 30, 2025 | September 30, 2024 | | :--- | :--- | :--- | | Total Investment Portfolio | $1.3391 billion | $1.0312 billion | | Number of Companies | 115 | 102 | | Average Investment Size | $11.6 million | $10.1 million | | Weighted Average Yield on Debt Investments | 10.4% | 11.3% | PSLF Investment Activity (Three Months Ended June 30) | PSLF Investment Activity (Three Months Ended June 30) | 2025 | 2024 | | :--- | :--- | :--- | | Investments Made | $22.0 million | $56.0 million | | Sales and Repayments | $71.4 million | $54.9 million | [Results of Operations](index=3&type=section&id=Results%20of%20Operations) This section analyzes the company's investment income, expenses, net investment income, and realized and unrealized gains/losses, culminating in the net change in net assets from operations [Investment Income](index=3&type=section&id=Investment%20Income) Investment income for the three and nine months ended June 30, 2025, decreased year-over-year, primarily due to a smaller investment portfolio and a lower weighted average yield on debt investments Investment Income (Millions of Dollars) | Investment Income (Millions of Dollars) | Three Months Ended June 30 | Nine Months Ended June 30 | | :--- | :--- | :--- | | 2025 Fiscal Year | $29.6 | $94.4 | | 2024 Fiscal Year | $37.0 | $107.3 | - The year-over-year decrease in investment income is primarily due to a smaller total investment portfolio and a lower weighted average yield on debt investments[15](index=15&type=chunk) [Expenses](index=3&type=section&id=Expenses) Total expenses for the three and nine months ended June 30, 2025, decreased year-over-year, mainly driven by reduced debt-related interest and fees, and lower incentive fees Total Expenses (Millions of Dollars) | Total Expenses (Millions of Dollars) | Three Months Ended June 30 | Nine Months Ended June 30 | | :--- | :--- | :--- | | 2025 Fiscal Year | $17.8 | $58.2 | | 2024 Fiscal Year | $21.3 | $61.7 | - The year-over-year decrease in expenses is primarily due to reduced debt-related interest and fees and lower incentive fees[16](index=16&type=chunk) [Net Investment Income](index=3&type=section&id=Net%20Investment%20Income) Net investment income for the three months ended June 30, 2025, was $11.8 million ($0.18 per share), a decrease from the prior year, mainly due to lower investment income partially offset by reduced expenses Net Investment Income | Net Investment Income | Three Months Ended June 30 | Nine Months Ended June 30 | | :--- | :--- | :--- | | **2025 Fiscal Year** | | | | Total | $11.8 million | $36.2 million | | Per Share | $0.18 | $0.55 | | **2024 Fiscal Year** | | | | Total | $15.7 million | $45.7 million | | Per Share | $0.24 | $0.70 | [Realized and Unrealized Gains/Losses](index=3&type=section&id=Realized%20and%20Unrealized%20Gains%2FLosses) For the three months ended June 30, 2025, the company reported net realized losses of $0.5 million and net unrealized losses of $0.2 million, with cumulative net unrealized appreciation of $40.4 million in the portfolio Gains/Losses Summary (Millions of Dollars) | Gains/Losses Summary (Millions of Dollars) | Three Months Ended June 30 | Nine Months Ended June 30 | | :--- | :--- | :--- | | **2025 Fiscal Year** | | | | Net Realized Gains (Losses) | $(0.5) million | $(30.8) million | | Net Change in Unrealized Appreciation (Depreciation) | $(0.2) million | $29.3 million | | **2024 Fiscal Year** | | | | Net Realized Gains (Losses) | $(6.9) million | $(36.1) million | | Net Change in Unrealized Appreciation (Depreciation) | $(5.1) million | $23.2 million | - As of June 30, 2025, the investment portfolio had cumulative net unrealized appreciation of **$40.4 million**, compared to **$11.2 million** as of September 30, 2024[20](index=20&type=chunk) [Net Change in Net Assets](index=4&type=section&id=Net%20Change%20in%20Net%20Assets) The net increase in net assets from operations for the three months ended June 30, 2025, was $8.2 million ($0.12 per share), an increase from the prior year, with a similar trend for the nine-month period Net Increase (Decrease) in Net Assets Resulting from Operations | Net Increase (Decrease) in Net Assets Resulting from Operations | Three Months Ended June 30 | Nine Months Ended June 30 | | :--- | :--- | :--- | | **2025 Fiscal Year** | | | | Total | $8.2 million | $33.7 million | | Per Share | $0.12 | $0.52 | | **2024 Fiscal Year** | | | | Total | $3.7 million | $30.5 million | | Per Share | $0.06 | $0.47 | [Liquidity and Capital Resources](index=4&type=section&id=Liquidity%20and%20Capital%20Resources) The company's liquidity is primarily derived from operating cash flow, investment sales, and debt financing, with a notable shift in cash flow dynamics compared to the prior year - The company's liquidity and capital resources primarily stem from cash flow from operations, proceeds from investment sales and repayments, securities offerings, and debt financing[23](index=23&type=chunk) Key Liquidity Metrics | Key Liquidity Metrics | June 30, 2025 | September 30, 2024 | | :--- | :--- | :--- | | Truist Credit Facility Outstanding Borrowings | $316.5 million | $461.5 million | | Truist Credit Facility Available Capacity | $183.5 million | $13.5 million | | Cash and Cash Equivalents | $70.5 million | $49.9 million | - For the nine months ended June 30, 2025, operating activities provided **$212.6 million** in cash, while financing activities used **$192.0 million**, primarily for credit repayments and dividend payments, a reversal from the prior year's cash flow dynamics[26](index=26&type=chunk)[27](index=27&type=chunk) [Distributions and Recent Developments](index=5&type=section&id=Distributions%20and%20Recent%20Developments) This section outlines the company's declared dividends for the quarter and future months, alongside a recent successful refinancing of its CLO VII subsidiary [Distributions](index=5&type=section&id=Distributions) For the three months ended June 30, 2025, the company declared dividends of $0.24 per share, an increase from the prior year, and announced future monthly dividends of $0.08 per share Declared Dividends | Declared Dividends | Three Months Ended June 30 | Nine Months Ended June 30 | | :--- | :--- | :--- | | **2025 Fiscal Year** | | | | Per Share | $0.24 | $0.72 | | Total | $15.7 million | $47.0 million | | **2024 Fiscal Year** | | | | Per Share | $0.22 | $0.64 | | Total | $14.4 million | $41.8 million | Future Dividend Declarations | Future Dividend Declarations | | | | :--- | :--- | :--- | | Record Date | Payment Date | Dividend Per Share | | August 15, 2025 | September 2, 2025 | $0.08 | | September 15, 2025 | September 30, 2025 | $0.08 | [Recent Developments](index=5&type=section&id=Recent%20Developments) In July 2025, PSLF's subsidiary, PennantPark CLO VII, LLC, successfully refinanced $300 million of its debt, reducing its weighted average cost of capital from SOFR+3.31% to SOFR+2.63% - In July 2025, PSLF's subsidiary CLO VII successfully refinanced, reducing its weighted average cost of capital from **SOFR+3.31%** to **SOFR+2.63%**[29](index=29&type=chunk) [Financial Statements](index=5&type=section&id=Financial%20Statements) This section presents the company's consolidated statements of assets and liabilities and consolidated statements of operations, highlighting key financial positions and performance metrics [Consolidated Statements of Assets and Liabilities](index=5&type=section&id=Consolidated%20Statements%20of%20Assets%20and%20Liabilities) As of June 30, 2025, total assets were $1.2529 billion, total liabilities were $772.3 million, and net assets were $480.6 million, with a decrease in NAV per share from $7.56 to $7.36 Key Balance Sheet Items (Millions of Dollars) | Key Balance Sheet Items (Millions of Dollars) | June 30, 2025 | September 30, 2024 | | :--- | :--- | :--- | | Total Investments (Fair Value) | $1,171.6 | $1,328.1 | | Cash and Cash Equivalents | $70.5 | $49.9 | | **Total Assets** | **$1,252.9** | **$1,389.1** | | **Total Liabilities** | **$772.3** | **$895.2** | | **Total Net Assets** | **$480.6** | **$493.9** | | **Net Asset Value Per Share** | **$7.36** | **$7.56** | [Consolidated Statements of Operations](index=6&type=section&id=Consolidated%20Statements%20of%20Operations) For the three months ended June 30, 2025, total investment income was $29.6 million, net investment income was $11.8 million, and the net increase in net assets from operations was $8.2 million Key Operating Statement Items (Millions of Dollars) | Key Operating Statement Items (Millions of Dollars) | Three Months Ended June 30 (2025) | Three Months Ended June 30 (2024) | | :--- | :--- | :--- | | Total Investment Income | $29.6 | $37.0 | | Net Expenses | $17.8 | $21.3 | | **Net Investment Income** | **$11.8** | **$15.7** | | Net Realized and Unrealized Gains (Losses) on Investments and Debt | $(3.6) | $(12.0) | | **Net Increase (Decrease) in Net Assets Resulting from Operations** | **$8.2** | **$3.7** |
PennantPark Investment Corporation Announces Financial Results for the Quarter Ended June 30, 2025
Globenewswire· 2025-08-11 20:05
Core Insights - PennantPark Investment Corporation reported its financial results for the third quarter ended June 30, 2025, highlighting a decrease in net asset value per share and net investment income compared to the previous year [1][16][21]. Financial Highlights - The investment portfolio totaled $1,171.6 million, with net assets of $480.6 million and a net asset value per share of $7.36, reflecting a quarterly change of -1.6% [2]. - Net investment income for the quarter was $11.8 million, or $0.18 per share, down from $15.7 million, or $0.24 per share, in the same quarter of 2024 [16][27]. - Total investment income for the quarter was $29.6 million, a decrease from $37.0 million in the prior year [14][36]. - Total expenses for the quarter were $17.8 million, down from $21.3 million in the same quarter of 2024 [15][36]. Portfolio Activity - The company made purchases of investments totaling $87.7 million and sales and repayments of investments totaling $132.2 million during the quarter [7]. - As of June 30, 2025, the portfolio consisted of 158 companies with an average investment size of $6.6 million, and a weighted average yield on debt investments of 11.5% [5][19]. Debt and Liquidity - The company had outstanding borrowings of $316.4 million under the Truist Credit Facility, with a weighted average interest rate of 6.7% [23]. - Cash and cash equivalents amounted to $70.5 million as of June 30, 2025, available for investing and general corporate purposes [24]. Distributions - Distributions declared during the quarter were $0.24 per share, totaling $15.7 million, compared to $0.22 per share, totaling $14.4 million in the same quarter of 2024 [27][28]. Recent Developments - In July 2025, the company refinanced its $300 million debt securitization, resulting in a decrease in the weighted average cost of capital from SOFR+3.31% to SOFR+2.63% [29].