PennantPark Investment Corporation (NYSE:PNNT) Q2 2024 Earnings Conference Call May 9, 2024 12:00 PM ET Company Participants Art Penn - Chairman and CEO Rick Allorto - CFO Conference Call Participants Brian Mckenna - Citizens JMP Robert Dodd - Raymond James Mickey Schleien - Ladenburg Mark Hughes - Truist Casey Alexander - Compass Point Kyle Joseph - Jefferies Operator Good afternoon, and welcome to the PennantPark Investment Corporation's Second Fiscal Quarter 2024 Earnings Conference Call. Today's confere ...

[PART I. CONSOLIDATED FINANCIAL INFORMATION](index=3&type=section&id=PART%20I.%20CONSOLIDATED%20FINANCIAL%20INFORMATION) This section presents the unaudited consolidated financial statements for PennantPark Investment Corporation, including statements of assets and liabilities, operations, changes in net assets, and cash flows, along with detailed schedules of investments and comprehensive notes [Item 1. Consolidated Financial Statements](index=4&type=section&id=Item%201.%20Consolidated%20Financial%20Statements) This section presents the unaudited consolidated financial statements for PennantPark Investment Corporation as of March 31, 2024, and for the three and six-month periods then ended [Consolidated Statements of Assets and Liabilities](index=4&type=section&id=Consolidated%20Statements%20of%20Assets%20and%20Liabilities) As of March 31, 2024, total assets increased to $1.29 billion from $1.16 billion, primarily driven by a rise in the fair value of investments, while net assets remained stable at approximately $501.5 million Consolidated Balance Sheet Highlights (in thousands, except per share data) | Metric | March 31, 2024 (unaudited) | September 30, 2023 | | :--- | :--- | :--- | | Total Investments at Fair Value | $1,238,231 | $1,101,647 | | Total Assets | $1,291,239 | $1,156,977 | | Total Liabilities | $789,710 | $654,790 | | Total Net Assets | $501,529 | $502,187 | | Net Asset Value (NAV) per share | $7.69 | $7.70 | [Consolidated Statements of Operations](index=5&type=section&id=Consolidated%20Statements%20of%20Operations) For the six months ended March 31, 2024, total investment income increased to $70.3 million, and net investment income rose to $29.9 million, resulting in a net decrease in net assets from operations of $26.7 million, a significant improvement from the prior year Key Operating Results (in thousands, except per share data) | Metric | Six Months Ended Mar 31, 2024 | Six Months Ended Mar 31, 2023 | | :--- | :--- | :--- | | Total Investment Income | $70,315 | $66,312 | | Net Expenses | $40,404 | $39,338 | | Net Investment Income | $29,911 | $26,974 | | Net Realized and Unrealized Loss | $(3,173) | $(93,994) | | Net Increase (Decrease) in Net Assets | $26,738 | $(67,020) | | Net Investment Income per Share | $0.46 | $0.41 | | Net Increase (Decrease) in Net Assets per Share | $0.41 | $(1.03) | [Consolidated Statements of Changes in Net Assets](index=6&type=section&id=Consolidated%20Statements%20of%20Changes%20in%20Net%20Assets) For the six months ended March 31, 2024, net assets decreased by $0.7 million, primarily due to distributions to stockholders nearly offsetting the net increase from operations, a substantial improvement from the prior year's larger decrease Changes in Net Assets (in thousands) | Description | Six Months Ended Mar 31, 2024 | Six Months Ended Mar 31, 2023 | | :--- | :--- | :--- | | Net Increase (Decrease) from Operations | $26,738 | $(67,020) | | Distributions to Stockholders | $(27,396) | $(22,830) | | **Net Increase (Decrease) in Net Assets** | **$(658)** | **$(89,850)** | | Net Assets, Beginning of Period | $502,187 | $585,565 | | **Net Assets, End of Period** | **$501,529** | **$495,715** | [Consolidated Statements of Cash Flows](index=7&type=section&id=Consolidated%20Statements%20of%20Cash%20Flows) For the six months ended March 31, 2024, net cash used in operating activities was $150.9 million, a significant shift from the prior year, while net cash provided by financing activities was $147.5 million, driven by net borrowings Summary of Cash Flows (in thousands) | Activity | Six Months Ended Mar 31, 2024 | Six Months Ended Mar 31, 2023 | | :--- | :--- | :--- | | Net Cash (Used in) Provided by Operating Activities | $(150,868) | $60,484 | | Net Cash Provided by (Used in) Financing Activities | $147,511 | $(49,046) | | **Net (Decrease) Increase in Cash** | **$(3,357)** | **$11,438** | | Cash and Cash Equivalents, End of Period | $35,418 | $66,436 | [Consolidated Schedules of Investments](index=8&type=section&id=Consolidated%20Schedules%20of%20Investments) As of March 31, 2024, the total investment portfolio's fair value increased to $1.24 billion, diversified across various company types, with First Lien Secured Debt remaining the largest category Portfolio Composition by Investment Type (Fair Value, in thousands) | Investment Type | March 31, 2024 | September 30, 2023 | | :--- | :--- | :--- | | First Lien Secured Debt | $678,605 | $527,657 | | Second Lien Secured Debt | $63,737 | $80,396 | | Subordinated Debt/Corporate Notes | $49,212 | $53,897 | | Subordinated notes in PSLF | $115,886 | $102,325 | | Equity & Warrants | $198,549 | $175,538 | | Equity in PSLF | $72,557 | $62,083 | | U.S. Government Securities | $59,685 | $99,751 | | **Total Investments** | **$1,238,231** | **$1,101,647** | [Notes to Consolidated Financial Statements](index=31&type=section&id=Notes%20to%20Consolidated%20Financial%20Statements) The notes detail the company's organization, accounting policies, related-party agreements, investment portfolio, fair value measurements, and debt structure, including fee arrangements and unfunded commitments - The company is a BDC focused on generating income and capital appreciation through debt and equity investments in U.S. middle-market companies[77](index=77&type=chunk) - A prior period error in cash classification related to affiliates PSLF and PTSF II was identified and corrected, with no impact on total net assets, NAV per share, or net investment income[87](index=87&type=chunk)[88](index=88&type=chunk) - The Investment Adviser earns a base management fee of **1.50%** on average adjusted gross assets, reduced to **1.00%** on assets exceeding 200% of net assets, plus a two-part incentive fee[113](index=113&type=chunk)[114](index=114&type=chunk)[115](index=115&type=chunk) - As of March 31, 2024, the company had **$242.1 million** in unfunded commitments to fund investments[186](index=186&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=41&type=section&id=Item%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses the company's financial condition, portfolio activity, results of operations, and liquidity, highlighting the portfolio value increase, weighted average yield, and net investment income growth [Portfolio and Investment Activity](index=43&type=section&id=Portfolio%20and%20Investment%20Activity) The company's portfolio grew to $1.24 billion across 138 companies, primarily in first lien secured debt, with a weighted average yield of 12.5%, and significant investment and repayment activity during the period Portfolio Summary | Metric | March 31, 2024 | September 30, 2023 | | :--- | :--- | :--- | | Total Portfolio Value | $1,238.2 million | $1,101.7 million | | Number of Companies | 138 | 129 | | Average Investment Size | $8.5 million | $7.8 million | | Weighted Avg. Yield on Debt | 12.5% | 13.0% | | First Lien Secured Debt % | 55% | 48% | | Non-Accrual (at Fair Value) | 3.0% | 0.0% | - For the six months ended March 31, 2024, the company invested **$419.6 million** in 18 new and 60 existing portfolio companies and received **$247.2 million** from sales and repayments (excluding U.S. Government Securities)[221](index=221&type=chunk) [Results of Operations](index=47&type=section&id=Results%20of%20Operations) For the six months ended March 31, 2024, investment income increased to $70.3 million, and net investment income grew to $29.9 million, resulting in a net increase in net assets from operations of $26.7 million, a substantial improvement from the prior year - Investment income for the six months ended March 31, 2024, increased year-over-year primarily due to a higher cost of yield on the debt portfolio[250](index=250&type=chunk) - Expenses increased for the six months ended March 31, 2024, mainly due to higher debt-related interest and general and administrative expenses[251](index=251&type=chunk) - The net increase in net assets from operations for the six months ended March 31, 2024, was **$26.7 million**, compared to a net decrease of **$67.0 million** for the same period in 2023[256](index=256&type=chunk) [Liquidity and Capital Resources](index=47&type=section&id=Liquidity%20and%20Capital%20Resources) The company's liquidity is sourced from operations, securities offerings, and debt financings, with $396.5 million outstanding on its Truist Credit Facility and an asset coverage ratio of 170% as of March 31, 2024 - The company's asset coverage ratio was **170%** as of March 31, 2024, above the required 150%[260](index=260&type=chunk) Debt and Liquidity Summary (as of March 31, 2024) | Item | Amount (in millions) | | :--- | :--- | | Truist Credit Facility Capacity | $475.0 | | Truist Credit Facility Outstanding | $396.5 | | Truist Credit Facility Unused Capacity | $78.5 | | 4.50% Notes due 2026 | $150.0 | | 4.00% Notes-2 due 2026 | $165.0 | | Cash and Cash Equivalents | $35.4 | [Item 3. Quantitative and Qualitative Disclosures About Market Risk](index=55&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) The company is primarily exposed to interest rate risk, with 97% of its debt portfolio in variable-rate investments, where a hypothetical 1% increase in base interest rates would increase net interest income by approximately $4.9 million annually - As of March 31, 2024, **97%** of the company's debt portfolio consisted of variable-rate investments, making it sensitive to changes in interest rates[298](index=298&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% | $(4,948) | $(0.08) | | Up 1% | $4,948 | $0.08 | | Up 2% | $9,896 | $0.15 | | Up 3% | $14,843 | $0.23 | | Up 4% | $19,816 | $0.30 | [Item 4. Controls and Procedures](index=55&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded that the company's disclosure controls and procedures were effective as of March 31, 2024, having remediated previously disclosed material weaknesses - Management concluded that disclosure controls and procedures were effective as of the quarter ended March 31, 2024[303](index=303&type=chunk) - The company has implemented remediation efforts for previously identified material weaknesses in internal controls related to cash/investment reconciliations and interest income/non-accrual analysis[302](index=302&type=chunk) [PART II. OTHER INFORMATION](index=56&type=section&id=PART%20II.%20OTHER%20INFORMATION) This section covers other information including legal proceedings, risk factors, unregistered sales of equity securities, defaults on senior securities, mine safety disclosures, and exhibits [Item 1. Legal Proceedings](index=56&type=section&id=Item%201.%20Legal%20Proceedings) The company, its Investment Adviser, and its Administrator are not currently subject to any material legal proceedings - There are no material legal proceedings against the company, its Investment Adviser, or its Administrator[305](index=305&type=chunk) [Item 1A. Risk Factors](index=56&type=section&id=Item%201A.%20Risk%20Factors) There have been no material changes to the risk factors previously disclosed in the company's Annual Report on Form 10-K for the fiscal year ended September 30, 2023 - The report refers to the risk factors disclosed in the Annual Report on Form 10-K for the fiscal year ended September 30, 2023, indicating no material changes[306](index=306&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=56&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) No unregistered securities were sold during the quarter ended March 31, 2024, and the company's share repurchase program expired on March 31, 2023 - No unregistered securities were sold in the quarter ended March 31, 2024[307](index=307&type=chunk) - The company's share repurchase program expired on March 31, 2023, with a total of **1,820,605 shares** purchased at an average price of **$7.28 per share**[308](index=308&type=chunk) [Item 3. Defaults Upon Senior Securities](index=56&type=section&id=Item%203.%20Defaults%20Upon%20Senior%20Securities) There were no defaults upon senior securities during the period - None[309](index=309&type=chunk) [Item 4. Mine Safety Disclosures](index=56&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) This item is not applicable to the company - Not applicable[310](index=310&type=chunk) [Item 5. Other Information](index=56&type=section&id=Item%205.%20Other%20Information) No officers or directors of the company have adopted or terminated any Rule 10b5-1 trading arrangements during the period - No Rule 10b5-1 trading arrangements were adopted or terminated by officers or directors[311](index=311&type=chunk) [Item 6. Exhibits](index=57&type=section&id=Item%206.%20Exhibits) This section lists the exhibits filed with the report, including certifications from the CEO and CFO, and XBRL data files

[Financial Highlights](index=1&type=section&id=Highlights) The company reported a **NAV per share of $7.69**, a 0.5% increase, with net investment income covering distributions and a growing investment portfolio Q2 2024 Key Financial Metrics | Metric | Value ($M) | | :--- | :--- | | **Assets & Liabilities** | | | Investment Portfolio | $1,238.2 | | Net Assets | $501.5 | | GAAP Net Asset Value per Share | $7.69 | | Quarterly Increase in GAAP NAV/share | 0.5% | | Regulatory Debt to Equity | 1.42x | | Weighted Average Yield on Debt | 12.5% | | **Operating Results** | | | Net Investment Income per Share | $0.22 | | Core Net Investment Income per Share | $0.22 | | Distributions Declared per Share | $0.21 | | **Portfolio Activity** | | | Purchases of Investments | $188.5 | | Sales and Repayments | $176.2 | - Core Net Investment Income (Core NII) for the quarter ended March 31, 2024, was equal to the GAAP Net Investment Income of **$0.22 per share**, as there were no one-time or non-recurring items[4](index=4&type=chunk) [Distribution Announcement](index=2&type=section&id=INCREASE%20OF%20MONTHLY%20DISTRIBUTION) The company announced a **14.3% increase** in its monthly distribution to **$0.08 per share**, driven by strong portfolio performance and robust earnings - On May 8, 2024, the company declared a monthly distribution of **$0.08 per share** for June 2024, a **14.3% increase** from the prior distribution[6](index=6&type=chunk) - The distribution is payable on July 1, 2024, to stockholders of record as of June 14, 2024, and is expected to be paid from taxable net investment income[6](index=6&type=chunk) - Chairman and CEO Arthur Penn stated the increase is based on "continued strong underlying credit performance" and a "robust" earnings stream, highlighting returns from the PSLF Joint Venture[7](index=7&type=chunk) [Portfolio and Investment Activity](index=2&type=section&id=PORTFOLIO%20AND%20INVESTMENT%20ACTIVITY) The investment portfolio grew to **$1.24 billion**, primarily in first lien secured and variable-rate debt, with increased non-accrual investments [Overall Portfolio Composition](index=2&type=section&id=Overall%20Portfolio%20Composition) The investment portfolio grew to **$1.24 billion**, with a higher allocation to first lien secured debt and an increase in non-accrual investments Portfolio Composition Comparison | Metric | March 31, 2024 ($M) | September 30, 2023 ($M) | | :--- | :--- | :--- | | **Total Portfolio** | **$1,238.2** | **$1,101.7** | | First Lien Secured Debt | 55% | 48% | | Second Lien Secured Debt | 5% | 7% | | Subordinated Debt | 13% | 14% | | Preferred & Common Equity | 22% | 22% | | **Debt Portfolio** | | | | Variable-Rate Investments | 97% | 95% | | Weighted Avg. Yield | 12.5% | 13.0% | | **Credit Quality** | | | | Companies on Non-Accrual | 2 | 1 | | Non-Accrual (% of Fair Value) | 3.0% | 0.0% | [Investment Activity](index=2&type=section&id=Investment%20Activity) Investment activity significantly increased, with **$188.5 million** invested and **$176.2 million** in sales and repayments for the quarter Investment Activity (Three Months Ended March 31) | Activity | 2024 ($M) | 2023 ($M) | | :--- | :--- | :--- | | Investments | $188.5 | $58.3 | | Sales & Repayments | $176.2 | $114.2 | | Weighted Avg. Yield on New Debt | 11.7% | 11.8% | Investment Activity (Six Months Ended March 31) | Activity | 2024 ($M) | 2023 ($M) | | :--- | :--- | :--- | | Investments | $419.6 | $144.8 | | Sales & Repayments | $247.2 | $136.8 | | Weighted Avg. Yield on New Debt | 11.8% | 11.5% | [PennantPark Senior Loan Fund (PSLF) Activity](index=3&type=section&id=PennantPark%20Senior%20Loan%20Fund%20%28PSLF%29%20Activity) The PSLF portfolio grew to **$923.9 million**, with significant investment activity including purchases from the Company - PSLF's portfolio increased to **$923.9 million** as of March 31, 2024, from **$804.2 million** as of September 30, 2023[12](index=12&type=chunk) - For the three months ended March 31, 2024, PSLF invested **$113.2 million** and had sales/repayments of **$49.7 million**, with investment activity substantially higher than the **$38.5 million** invested in the same period of 2023[13](index=13&type=chunk)[14](index=14&type=chunk) [Results of Operations](index=3&type=section&id=RESULTS%20OF%20OPERATIONS) Net investment income decreased to **$14.3 million**, or **$0.22 per share**, while net assets from operations significantly increased due to unrealized appreciation [Investment Income](index=3&type=section&id=Investment%20Income) Total investment income slightly decreased to **$36.0 million** for the quarter but increased to **$70.3 million** for the six-month period Investment Income Breakdown (in millions) | Period | Q2 2024 ($M) | Q2 2023 ($M) | Six Months 2024 ($M) | Six Months 2023 ($M) | | :--- | :--- | :--- | :--- | :--- | | **Total Investment Income** | **$36.0** | **$36.3** | **$70.3** | **$66.3** | [Expenses](index=3&type=section&id=Expenses) Total expenses increased to **$21.7 million** for the quarter, primarily due to higher debt-related interest and administrative costs Expenses Breakdown (in millions) | Period | Q2 2024 ($M) | Q2 2023 ($M) | Six Months 2024 ($M) | Six Months 2023 ($M) | | :--- | :--- | :--- | :--- | :--- | | **Total Expenses** | **$21.7** | **$19.7** | **$40.4** | **$39.3** | [Net Investment Income (NII)](index=3&type=section&id=Net%20Investment%20Income) Net investment income decreased to **$14.3 million**, or **$0.22 per share**, primarily due to higher expenses outpacing investment income Net Investment Income Comparison | Period | Q2 2024 ($M) | Q2 2023 ($M) | | :--- | :--- | :--- | | Net Investment Income | $14.3 | $16.6 | | NII per Share | $0.22 | $0.26 | [Realized and Unrealized Gains/Losses](index=4&type=section&id=Realized%20and%20Unrealized%20Gains%2FLosses) The company recorded a net realized loss of **$31.0 million** offset by **$33.2 million** in unrealized appreciation, resulting in a net gain from valuation changes - Net realized losses for Q2 2024 were **$(31.0) million**, a substantial improvement from **$(148.7) million** in Q2 2023[20](index=20&type=chunk) - The net change in unrealized appreciation on investments for Q2 2024 was **$33.2 million**, compared to **$135.4 million** in Q2 2023[21](index=21&type=chunk) - Overall net unrealized appreciation on investments stood at **$12.0 million** as of March 31, 2024, reversing the net unrealized depreciation of **$(16.3) million** as of September 30, 2023[21](index=21&type=chunk) [Net Change in Net Assets Resulting from Operations](index=4&type=section&id=Net%20Change%20in%20Net%20Assets%20Resulting%20from%20Operations) The company reported a net increase in net assets from operations of **$16.1 million**, or **$0.25 per share**, a significant improvement year-over-year Net Increase in Net Assets from Operations | Period | Q2 2024 ($M) | Q2 2023 ($M) | | :--- | :--- | :--- | | Net Increase in Net Assets | $16.1 | $4.9 | | Per Share | $0.25 | $0.07 | [Liquidity and Capital Resources](index=4&type=section&id=LIQUIDITY%20AND%20CAPITAL%20RESOURCES) The company maintained **$35.4 million** in cash and **$78.5 million** in unused borrowing capacity, with increased credit facility utilization for investments - Cash and cash equivalents were **$35.4 million** as of March 31, 2024[26](index=26&type=chunk) Credit Facility Status | Metric | March 31, 2024 ($M) | September 30, 2023 ($M) | | :--- | :--- | :--- | | Outstanding Borrowings | $396.5 | $212.4 | | Unused Capacity | $78.5 | $262.6 | | Weighted Avg. Interest Rate | 7.7% | 7.7% | - For the six months ended March 31, 2024, cash used in operating activities was **$150.9 million**, primarily for investment activities, while cash provided by financing activities was **$147.5 million**, mainly from credit facility borrowings[26](index=26&type=chunk)[27](index=27&type=chunk) [Financial Statements](index=5&type=section&id=Financial%20Statements) Total assets increased to **$1.29 billion**, driven by portfolio growth, while liabilities also rose, resulting in a slight decrease in net assets to **$501.5 million** [Consolidated Statements of Assets and Liabilities](index=5&type=section&id=CONSOLIDATED%20STATEMENTS%20OF%20ASSETS%20AND%20LIABILITIES) Total investments reached **$1.24 billion**, total assets **$1.29 billion**, and total net assets **$501.5 million**, with NAV per share at **$7.69** Key Balance Sheet Items (in thousands) | Account | March 31, 2024 ($K) | September 30, 2023 ($K) | | :--- | :--- | :--- | | Total Investments (Fair Value) | $1,238,231 | $1,101,647 | | Total Assets | $1,291,239 | $1,156,977 | | Total Liabilities | $789,710 | $654,790 | | **Total Net Assets** | **$501,529** | **$502,187** | | **Net Asset Value per Share** | **$7.69** | **$7.70** | [Consolidated Statements of Operations](index=6&type=section&id=CONSOLIDATED%20STATEMENTS%20OF%20OPERATIONS) For the quarter, total investment income was **$36.0 million**, leading to **$14.3 million** in net investment income and a **$16.1 million** net increase in net assets Key Income Statement Items (Three Months Ended March 31, in thousands) | Account | 2024 ($K) | 2023 ($K) | | :--- | :--- | :--- | | Total Investment Income | $35,979 | $36,349 | | Net Expenses | $21,727 | $19,709 | | **Net Investment Income** | **$14,252** | **$16,640** | | Net Realized/Unrealized Gain (Loss) | $1,833 | $(11,768) | | **Net Increase in Net Assets** | **$16,085** | **$4,872** | | **EPS (from operations)** | **$0.25** | **$0.07** | | **NII per Share** | **$0.22** | **$0.26** | [Corporate Information](index=7&type=section&id=Corporate%20Information) PennantPark Investment Corporation is a BDC investing in U.S. middle-market companies, managed by PennantPark Investment Advisers, LLC, with **$7.2 billion** in capital - The company is a BDC that invests primarily in U.S. middle-market companies via first and second lien secured debt, subordinated debt, and equity[36](index=36&type=chunk) - The company is managed by PennantPark Investment Advisers, LLC, which manages **$7.2 billion** of investable capital[37](index=37&type=chunk)

Financial Data and Key Metrics Changes - For the quarter ended December 31, GAAP and core net investment income was $0.24 per share, while GAAP and adjusted NAV decreased by 0.6% to $7.65 per share from $7.70 per share [8][35] - The portfolio grew to $1.2 billion, representing a 16% increase from the prior quarter [8] - The debt-to-equity ratio was 1.4x as of December 31 [24] Business Line Data and Key Metrics Changes - The company invested $231 million across 12 new and 32 existing portfolio companies at a weighted average yield of 11.9% [16] - The weighted average debt to EBITDA for new portfolio companies was 3.7 times, with an interest coverage ratio of 2.4 times and a loan-to-value ratio of 55% [16] - The portfolio's weighted average leverage ratio through debt securities was 4.9 times, with an interest coverage ratio of 2.2 times [17][55] Market Data and Key Metrics Changes - The company focuses on the core middle market, targeting companies with $10 million to $50 million of EBITDA, which does not compete with the broadly syndicated loan or high-yield markets [18][20] - The company has seen a 25 basis point tightening of first lien spreads [17] Company Strategy and Development Direction - The company aims to generate attractive risk-adjusted returns through income while preserving capital, focusing on growing middle market companies with high free cash flow conversion [53] - The company has a long-term track record of financing growing middle market companies in five key sectors: business services, consumer, government services and defense, health care, and software and technology [30] - The company emphasizes the importance of meaningful covenants in its originated first lien loans, which help protect capital [20] Management's Comments on Operating Environment and Future Outlook - Management believes the current vintage of core middle market directly originated loans is excellent, with lower leverage, higher spreads, and tighter covenants compared to the upper middle market [28] - The company is well-positioned as a lender focused on capital preservation in an uncertain market environment [18] - Management noted that while credit quality is stable, some companies may need amendments and extensions if high base rates persist [65] Other Important Information - The portfolio remains highly diversified with 139 companies across 30 different industries, and 96% of the debt portfolio is floating rate [55] - The company has invested over $448 million in equity co-investments, generating an IRR of 26% and a multiple on invested capital of 2.1 times [21] Q&A Session Summary Question: What was the origination activity late in the quarter? - About 40% of the origination was done in December [39] Question: Any changes in the attractiveness of sectors? - The company has been very active in defense and government services due to geopolitical tailwinds, while being cautious in consumer sectors [40][42] Question: Are there any signs of weakness in the portfolio? - Management underwrites assuming a recession, and while credits are performing well, some companies may need relief if high base rates continue [65] Question: What drove the depreciation this quarter? - The depreciation was broad across the book, with specific loans marked down including Flock Financial and Walker Edison [51] Question: What is the current PIK income percentage? - PIK income was about 3% of total income for the quarter [91]

UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-Q (Mark One) ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 FOR THE QUARTERLY PERIOD ENDED DECEMBER 31, 2023 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 FOR THE TRANSITION PERIOD FROM TO COMMISSION FILE NUMBER: 814-00736 PENNANTPARK INVESTMENT CORPORATION (Exact name of registrant as specified in its charter) (State or other jurisdiction ...

[Part I](index=3&type=section&id=PART%20I) [Item 1. Business](index=4&type=section&id=Item%201.%20Business) PennantPark Investment Corporation (PNNT) is a Business Development Company (BDC) focused on generating income and capital appreciation by investing in U.S. middle-market companies - PNNT's primary business objective is to generate both current income and capital appreciation by investing in U.S. middle-market companies with annual revenues between **$50 million and $1 billion**[20](index=20&type=chunk)[21](index=21&type=chunk) - The company is an externally managed, non-diversified investment company that has elected to be treated as a BDC under the 1940 Act and a RIC for federal income tax purposes[23](index=23&type=chunk) - PNNT's investment adviser, PennantPark Investment Advisers, has invested **$18.5 billion** in **653 companies** since its inception in 2007, demonstrating extensive experience in the middle-market lending space[28](index=28&type=chunk) Portfolio Composition by Fair Value (as of September 30, 2023) | Investment Type | Percentage of Portfolio | | :--- | :--- | | First Lien Secured Debt | 48% | | Second Lien Secured Debt | 7% | | Subordinated Debt (incl. PSLF) | 14% | | Preferred and Common Equity (incl. PSLF) | 22% | | U.S. Government Securities | 9% | Top Industries by Portfolio Assets (as of September 30, 2023) | Industry | Percentage of Portfolio | | :--- | :--- | | Business Services | 18% | | Healthcare, Education and Childcare | 14% | | Consumer Products | 9% | | Distribution | 8% | | Financial Services | 6% | [Leverage](index=6&type=section&id=Leverage) The company utilizes various debt instruments, including credit facilities and notes, to finance its investments and operations Outstanding Debt as of September 30, 2023 | Debt Instrument | Total Commitment/Principal | Outstanding Borrowings | Interest Rate/Coupon | | :--- | :--- | :--- | :--- | | Truist Credit Facility | $475.0 million | $212.4 million | 7.7% (weighted avg.) | | 2026 Notes | $150.0 million | $150.0 million | 4.50% | | 2026 Notes-2 | $165.0 million | $165.0 million | 4.00% | - The company's asset coverage requirement for senior securities was reduced from **200% to 150%** following stockholder approval on February 5, 2019, allowing for increased leverage[47](index=47&type=chunk) [Investment Management Agreement](index=11&type=section&id=Investment%20Management%20Agreement) The company's investment adviser earns fees based on a combination of base management fees and performance-based incentive fees - The base management fee is **1.50%** of average adjusted gross assets, reduced to **1.00%** on gross assets exceeding **200%** of total net assets[81](index=81&type=chunk) - The incentive fee has two parts: one based on Pre-Incentive Fee Net Investment Income exceeding a **1.75%** quarterly hurdle rate, and a second part equal to **17.5%** of cumulative realized capital gains net of losses and unrealized depreciation[83](index=83&type=chunk)[85](index=85&type=chunk) Fees Earned by Investment Adviser (in millions) | Fee Type | FY 2023 | FY 2022 | FY 2021 | | :--- | :--- | :--- | :--- | | Base Management Fee | $16.5 | $19.8 | $17.3 | | Incentive Fee on NII | $13.9 | $2.7 | $0.6 | [Regulation](index=14&type=section&id=REGULATION) The company operates under specific regulatory requirements as a Business Development Company (BDC) and a Regulated Investment Company (RIC) - As a BDC, the company must invest at least **70%** of its assets in "qualifying assets," which are primarily securities of private or thinly traded U.S. companies[105](index=105&type=chunk) - To maintain its RIC status for tax purposes, the company must annually distribute at least **90%** of its investment company taxable income[127](index=127&type=chunk) - The company's subsidiary, SBIC II, was licensed by the SBA but has since repaid all outstanding debentures and surrendered its license[141](index=141&type=chunk) [Item 1A. Risk Factors](index=20&type=section&id=Item%201A.%20Risk%20Factors) This section details the significant risks associated with investing in the company's securities, including business, liquidity, investment, and market risks [Risks Relating to Our Business and Structure](index=20&type=section&id=RISKS%20RELATING%20TO%20OUR%20BUSINESS%20AND%20STRUCTURE) The company faces risks related to market competition, reliance on key personnel, interest rate fluctuations, internal control deficiencies, and the use of leverage - The company operates in a highly competitive market for investment opportunities, competing with other BDCs, banks, and private funds, which could limit its ability to find attractive investments[150](index=150&type=chunk) - Dependence on the Investment Adviser's key personnel is a significant risk; their departure could harm the company's ability to achieve its investment objectives[158](index=158&type=chunk) - The company is exposed to interest rate risk, as rising rates increase borrowing costs and could lead to defaults from portfolio companies with floating-rate debt[160](index=160&type=chunk)[163](index=163&type=chunk) - Material weaknesses in internal control over financial reporting have been identified, which could impact the accuracy of financial reporting if not remediated[170](index=170&type=chunk) - The use of leverage, permitted up to a **150%** asset coverage ratio, increases the risk of loss for common stockholders if the value of assets declines[180](index=180&type=chunk)[189](index=189&type=chunk) [Risks Relating to the Illiquid Nature of Portfolio Assets](index=28&type=section&id=RISKS%20RELATING%20TO%20THE%20ILLIQUID%20NATURE%20OF%20OUR%20PORTFOLIO%20ASSETS) The company's investments in illiquid assets pose valuation challenges and may restrict its ability to sell assets when necessary - The company invests in illiquid assets, and its valuation procedures may result in recorded values that differ materially from the values ultimately received upon disposition[225](index=225&type=chunk) - The lack of liquidity in investments may make it difficult or impossible to sell assets when needed, potentially forcing sales at a significant loss, especially during market disruptions[229](index=229&type=chunk) [Risks Relating to Our Investments](index=29&type=section&id=RISKS%20RELATING%20TO%20OUR%20INVESTMENTS) Investments in middle-market companies carry inherent risks due to their characteristics and the company's non-diversified investment strategy - Investments in middle-market companies are inherently risky due to factors such as high leverage, limited financial resources, and dependence on small management teams[235](index=235&type=chunk) - The company is a non-diversified investment company, meaning it can invest a large portion of its assets in a small number of issuers, increasing risk concentration[240](index=240&type=chunk) - The incentive fee structure may induce the Investment Adviser to make more speculative investments to increase its compensation, potentially leading to higher investment losses[248](index=248&type=chunk) [Risks Relating to an Investment in Our Common Stock](index=32&type=section&id=RISKS%20RELATING%20TO%20AN%20INVESTMENT%20IN%20OUR%20COMMON%20STOCK) Investing in the company's common stock carries risks including potential trading discounts to NAV, dilution from future issuances, and uncertainty regarding distributions - The company's shares may trade at a significant discount to their Net Asset Value (NAV), a risk separate from the risk of NAV declining[266](index=266&type=chunk) - Future issuances of common stock below the then-current NAV per share, if approved by stockholders, could materially dilute existing shareholders' interests[258](index=258&type=chunk)[260](index=260&type=chunk) - There is a risk that stockholders may not receive distributions or that distributions may not grow, and they may be limited by asset coverage requirements[262](index=262&type=chunk) [Risks Relating to an Investment in Our Debt Securities](index=34&type=section&id=RISKS%20RELATING%20TO%20AN%20INVESTMENT%20IN%20OUR%20DEBT%20SECURITIES) The company's debt securities are subject to subordination risks and limited protective covenants - The 2026 Notes and 2026-2 Notes are unsecured and are effectively subordinated to any current or future secured indebtedness, such as the Truist Credit Facility[274](index=274&type=chunk) - The notes are structurally subordinated to all indebtedness and liabilities of the company's subsidiaries, as the assets of subsidiaries are not directly available to satisfy the claims of the company's creditors[275](index=275&type=chunk)[276](index=276&type=chunk) - The indenture governing the notes offers limited protection to holders and does not restrict the company from incurring additional debt or engaging in various corporate transactions that could adversely impact the notes' value[277](index=277&type=chunk) [Item 1B. Unresolved Staff Comments](index=37&type=section&id=Item%201B.%20Unresolved%20Staff%20Comments) The company reports that it has no unresolved staff comments from the SEC - None[301](index=301&type=chunk) [Item 2. Properties](index=37&type=section&id=Item%202.%20Properties) The company does not own any real estate or other material physical properties, utilizing facilities provided by its Investment Adviser and Administrator - As of September 30, 2023, the company did not own any real estate or other physical properties material to its operation[303](index=303&type=chunk) [Item 3. Legal Proceedings](index=37&type=section&id=Item%203.%20Legal%20Proceedings) The company, its Investment Adviser, and its Administrator are not currently subject to any material legal proceedings, nor are any known to be threatened - The company reports no material legal proceedings against itself, its Investment Adviser, or its Administrator[304](index=304&type=chunk) [Part II](index=38&type=section&id=PART%20II) [Item 5. Market For Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities](index=38&type=section&id=Item%205.%20Market%20For%20Registrant's%20Common%20Equity%2C%20Related%20Stockholder%20Matters%20and%20Issuer%20Purchases%20of%20Equity%20Securities) This section provides information on the company's common stock (PNNT), including its trading price relative to NAV, share repurchase program status, and distribution details Quarterly Stock Price and NAV Per Share (FY 2023) | Quarter | NAV per Share | High Price | Low Price | High Price to NAV | Low Price to NAV | | :--- | :--- | :--- | :--- | :--- | :--- | | Q4 2023 | $7.70 | $6.92 | $5.95 | (10)% | (23)% | | Q3 2023 | $7.72 | $6.00 | $4.76 | (22)% | (38)% | | Q2 2023 | $7.60 | $6.25 | $4.99 | (18)% | (34)% | | Q1 2023 | $7.71 | $6.30 | $5.45 | (18)% | (29)% | - The company's share repurchase program, which allowed for up to **$25 million** in repurchases, expired on March 31, 2023[312](index=312&type=chunk) - No shares were repurchased during the fiscal year ended September 30, 2023[312](index=312&type=chunk) - For the fiscal year ended September 30, 2023, total distributions from ordinary income were **$49.6 million**, or **$0.76 per share**[316](index=316&type=chunk) - No distributions were made from long-term capital gains[316](index=316&type=chunk) [Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=43&type=section&id=Item%207.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) This section analyzes the company's financial performance for FY 2023, highlighting increased net investment income, significant realized losses, and portfolio value changes [Portfolio and Investment Activity](index=45&type=section&id=PORTFOLIO%20AND%20INVESTMENT%20ACTIVITY) This section summarizes the company's investment portfolio characteristics and activity for the fiscal year ended September 30, 2023 Portfolio Summary (as of Sept 30) | Metric | 2023 | 2022 | | :--- | :--- | :--- | | Total Portfolio Value | $1,101.7 million | $1,226.3 million | | Number of Companies | 129 | 123 | | Avg. Investment Size | $7.8 million | $10.0 million | | Weighted Avg. Yield on Debt | 13.0% | 10.8% | | Non-Accrual (Cost Basis) | 1.2% | 1.2% | Investment Activity (Year Ended Sept 30) | Activity | 2023 | 2022 | | :--- | :--- | :--- | | Investments Made | $275.4 million | $933.8 million | | Sales and Repayments | $418.6 million | $911.6 million | [Results of Operations](index=49&type=section&id=RESULTS%20OF%20OPERATIONS) This section details the company's financial results, including investment income, expenses, and net changes in assets for the fiscal year ended September 30, 2023 Results of Operations Summary (Year Ended Sept 30) | Metric (in millions) | 2023 | 2022 | | :--- | :--- | :--- | | Total Investment Income | $145.4 | $105.0 | | Net Expenses | $79.8 | $61.0 | | **Net Investment Income** | **$65.5** | **$43.9** | | Net Realized Gain (Loss) | $(156.8) | $34.8 | | Net Unrealized Appreciation (Depreciation) | $59.6 | $(110.0) | | **Net Change in Net Assets** | **$(33.8)** | **$(24.7)** | - The increase in investment income in FY 2023 was primarily due to higher SOFR base rates[385](index=385&type=chunk) - The significant net realized loss in FY 2023 was primarily due to the realization of the investment in RAM Energy Holdings LLC[390](index=390&type=chunk) [Liquidity and Capital Resources](index=50&type=section&id=LIQUIDITY%20AND%20CAPITAL%20RESOURCES) This section outlines the company's financial flexibility, including its asset coverage ratio, available borrowing capacity, and cash position - As of September 30, 2023, the company's asset coverage ratio was **195%**, compliant with the **150%** regulatory requirement[397](index=397&type=chunk) - The company had **$262.6 million** of unused borrowing capacity under its Truist Credit Facility as of September 30, 2023[398](index=398&type=chunk) - The company repaid the remaining **$20.0 million** of its SBA debentures during the nine months ended June 30, 2023[406](index=406&type=chunk) - As of September 30, 2023, the company had cash and cash equivalents of **$38.8 million** available for investing and general corporate purposes[410](index=410&type=chunk) [Item 7A. Quantitative and Qualitative Disclosures About Market Risk](index=59&type=section&id=Item%207A.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) The company is primarily exposed to market risk through interest rate fluctuations, given its significant portfolio of variable-rate investments - As of September 30, 2023, **95%** of the company's debt portfolio consisted of variable-rate investments, making it sensitive to interest rate fluctuations[440](index=440&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% | $(5,373) | $(0.08) | | Up 1% | $5,373 | $0.08 | | Up 2% | $10,746 | $0.16 | | Up 3% | $16,120 | $0.25 | | Up 4% | $21,497 | $0.33 | [Item 8. Consolidated Financial Statements and Supplementary Data](index=60&type=section&id=Item%208.%20Consolidated%20Financial%20Statements%20and%20Supplementary%20Data) This section contains the company's audited consolidated financial statements for FY 2023, including management's report on internal controls and the independent auditor's reports [Management's Report on Internal Control Over Financial Reporting](index=61&type=section&id=Management's%20Report%20on%20Internal%20Control%20Over%20Financial%20Reporting) Management concluded that the company's internal control over financial reporting was not effective as of September 30, 2023, due to identified material weaknesses - Management concluded that as of September 30, 2023, the company did not maintain effective internal control over financial reporting due to identified material weaknesses[450](index=450&type=chunk) - Material weaknesses were identified in controls related to the review of quarterly cash and investment reconciliations, as well as the review of interest income and non-accrual classification of investments[451](index=451&type=chunk) - Management has begun remediation efforts, including enhancing existing controls and policies to improve the overall control environment[452](index=452&type=chunk)[454](index=454&type=chunk) [Report of Independent Registered Public Accounting Firm](index=62&type=section&id=Report%20of%20Independent%20Registered%20Public%20Accounting%20Firm) The independent auditor issued an adverse opinion on internal controls but an unqualified opinion on the consolidated financial statements - The independent auditor, RSM US LLP, issued an adverse opinion on the effectiveness of the company's internal control over financial reporting as of September 30, 2023, due to the identified material weaknesses[455](index=455&type=chunk)[457](index=457&type=chunk) - The auditor issued an unqualified (clean) opinion on the consolidated financial statements, stating they present fairly, in all material respects, the financial position and results of operations of the company[456](index=456&type=chunk)[462](index=462&type=chunk) - The audit report includes an Emphasis of Matter paragraph noting that the 2022 financial statements were restated to reclassify certain amounts[464](index=464&type=chunk) [Consolidated Financial Statements](index=65&type=section&id=Consolidated%20Financial%20Statements) This section presents the company's key financial statements, including the Statement of Assets and Liabilities and the Statement of Operations Consolidated Statement of Assets and Liabilities (in thousands) | | Sep 30, 2023 | Sep 30, 2022 | | :--- | :--- | :--- | | Total Investments (at fair value) | $1,101,647 | $1,226,301 | | Total Assets | $1,156,977 | $1,320,619 | | Total Liabilities | $654,790 | $735,054 | | **Total Net Assets** | **$502,187** | **$585,565** | | **Net Asset Value per Share** | **$7.70** | **$8.98** | Consolidated Statement of Operations (in thousands) | | FY 2023 | FY 2022 | FY 2021 | | :--- | :--- | :--- | :--- | | Total Investment Income | $145,366 | $104,966 | $81,588 | | Net Expenses | $79,833 | $61,023 | $45,112 | | **Net Investment Income** | **$65,533** | **$43,943** | **$36,476** | | Net Realized/Unrealized Gain (Loss) | $(99,340) | $(68,683) | $130,141 | | **Net Increase (Decrease) in Net Assets** | **$(33,807)** | **$(24,740)** | **$166,617** | [Item 9A. Controls and Procedures](index=102&type=section&id=Item%209A.%20Controls%20and%20Procedures) Management concluded that the company's disclosure controls and procedures were not effective as of September 30, 2023, due to identified material weaknesses, but remediation efforts are underway - Management concluded that disclosure controls and procedures were not effective as of September 30, 2023, due to the material weaknesses identified in internal controls[647](index=647&type=chunk) - The company has begun remediation efforts for the current material weaknesses, which include enhancing review controls and policies[648](index=648&type=chunk)[655](index=655&type=chunk) - A material weakness identified as of September 30, 2022, related to providing information to valuation services, was successfully remediated during fiscal year 2023[650](index=650&type=chunk)[651](index=651&type=chunk)[652](index=652&type=chunk) [Part III](index=104&type=section&id=PART%20III) [Item 10. Directors, Executive Officers and Corporate Governance](index=104&type=section&id=Item%2010.%20Directors%2C%20Executive%20Officers%20and%20Corporate%20Governance) Information regarding directors, executive officers, and corporate governance will be incorporated by reference from the forthcoming 2024 Proxy Statement - Information regarding directors, executive officers, and corporate governance is incorporated by reference from the forthcoming 2024 Proxy Statement[661](index=661&type=chunk) [Item 11. Executive Compensation](index=104&type=section&id=Item%2011.%20Executive%20Compensation) Information regarding executive compensation will be incorporated by reference from the forthcoming 2024 Proxy Statement - Information regarding executive compensation is incorporated by reference from the forthcoming 2024 Proxy Statement[662](index=662&type=chunk) [Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters](index=104&type=section&id=Item%2012.%20Security%20Ownership%20of%20Certain%20Beneficial%20Owners%20and%20Related%20Stockholder%20Matters) Information regarding security ownership of certain beneficial owners and management, and related stockholder matters, will be incorporated by reference from the forthcoming 2024 Proxy Statement - Information regarding security ownership is incorporated by reference from the forthcoming 2024 Proxy Statement[663](index=663&type=chunk) [Item 13. Certain Relationships and Related Transactions, and Director Independence](index=104&type=section&id=Item%2013.%20Certain%20Relationships%20and%20Related%20Transactions%2C%20and%20Director%20Independence) Information regarding certain relationships and related transactions, and director independence, will be incorporated by reference from the forthcoming 2024 Proxy Statement - Information regarding related transactions and director independence is incorporated by reference from the forthcoming 2024 Proxy Statement[664](index=664&type=chunk) [Item 14. Principal Accountant Fees and Services](index=104&type=section&id=Item%2014.%20Principal%20Accountant%20Fees%20and%20Services) Information regarding principal accountant fees and services will be incorporated by reference from the forthcoming 2024 Proxy Statement - Information regarding principal accountant fees and services is incorporated by reference from the forthcoming 2024 Proxy Statement[665](index=665&type=chunk) [Part IV](index=105&type=section&id=PART%20IV) [Item 15. Exhibits and Financial Statement Schedules](index=105&type=section&id=Item%2015.%20Exhibits%20and%20Financial%20Statement%20Schedules) This section lists all financial statements, schedules, and exhibits filed as part of the Annual Report on Form 10-K - This section lists all financial statements, schedules, and exhibits filed with the Form 10-K, including key corporate documents, debt agreements, and management agreements[667](index=667&type=chunk)

Financial Data and Key Metrics Changes - For the quarter ended September 30, GAAP and core net investment income was $0.24 per share, with an adjusted NAV per share of $7.70, up 0.4% from the prior quarter [1][2][60] - The GAAP NAV decreased slightly to $7.70 per share from $7.72 per share in the previous quarter [2][60] - The weighted average yield on debt investments increased to 13% from 12.7% in the prior quarter and 10.8% a year ago [4][60] Business Line Data and Key Metrics Changes - The portfolio remains diversified with 129 companies across 27 different industries, with 95% of the debt portfolio being floating rate [4][60] - The debt-to-EBITDA ratio on the portfolio is 5x, and the interest coverage ratio is 2.3x, indicating a meaningful cushion regarding interest coverage [5][60] - The company invested $61 million in two new and 31 existing portfolio companies at a weighted average yield of 11.2% during the quarter [61] Market Data and Key Metrics Changes - The company has seen an increase in deal flow compared to the first half of 2023, with a growing pipeline of attractive investment opportunities [63][66] - Approximately 12% of the portfolio is in government services and defense, which is expected to benefit from strong tailwinds in the current geopolitical environment [67][68] Company Strategy and Development Direction - The company focuses on the core middle market, providing strategic capital to borrowers in sectors such as business services, consumer, government services and defense, healthcare, and software technology [67][68] - The company aims to rotate equity positions into cash as deal flow increases, targeting lower equity exposure [21][22] Management's Comments on Operating Environment and Future Outlook - Management believes the current market environment of inflation, rising interest rates, and geopolitical risks positions the company well as a lender focused on capital preservation [66] - The company expects continued growth in the joint venture portfolio, which is anticipated to enhance earnings momentum in future quarters [65][66] Other Important Information - The joint venture portfolio equaled $804 million, with the JV investing $57 million during the quarter [64][65] - The company has a long-term track record of generating value with a loss ratio of approximately 20 basis points annually since inception [72] Q&A Session Summary Question: Can you elaborate on the EBITDA growth year-over-year or since last quarter? - Management confirmed that EBITDA is generally up, with revenues in the portfolio trending positively [11] Question: Are there any changes in the type of deals in the pipeline? - Management indicated that there are no material differences in the types of deals, maintaining a focus on high free cash flow companies [12][13] Question: What is the expected mix of the portfolio going forward? - Management expects the mix to remain generally the same, with a focus on reducing equity exposure over time [21] Question: Is there anything under 1x interest coverage in the portfolio? - Management stated that there is currently nothing under 1x interest coverage [23] Question: How is the Board thinking about the dividend? - Management is monitoring the situation and maintaining a cushion for the monthly dividend, with no immediate decisions on changes [43][44] Question: What are the competitive dynamics in the market? - Management noted that while banks are exiting the middle market, private BDCs are raising capital, leading to a mixed competitive landscape [39][40]

PennantPark Investment Corporation (NYSE:PNNT) Q3 2023 Results Conference Call August 10, 2023 12:00 PM ET Company Participants Art Penn - Founder, Chairman, Managing Partner & CEO Richard Allorto - Chief Financial Officer Conference Call Participants Robert Dodd - Raymond James C.J. Alex - Compass Point Research Paul Johnson - KBW Mark Hughes - Truist Kyle Joseph - Jefferies Melissa Wedel - JPMorgan Operator Good afternoon, and welcome to the PennantPark Investment Corporation's Third Fiscal Quarter 2023 ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-Q (Mark One) ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 FOR THE QUARTERLY PERIOD ENDED JUNE 30, 2023 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 FOR THE TRANSITION PERIOD FROM TO COMMISSION FILE NUMBER: 814-00736 PENNANTPARK INVESTMENT CORPORATION (Exact name of registrant as specified in its charter) (State or other jurisdiction of ...

PennantPark Investment Corporation (NYSE:PNNT) Q2 2023 Earnings Conference Call May 11, 2023 ET Company Participants Art Penn - Chairman and CEO Rick Allorto - CFO Conference Call Participants Paul Johnson - KBW Robert Dodd - Raymond James Kyle Joseph - Jefferies Mickey Schleien - Ladenburg Mark Hughes - Truist. Melissa Wedel - JP Morgan Casey Alexander - Compass Point Operator Good afternoon and welcome to the PennantPark Investment Corporation's Second Fiscal Quarter 2023 Earnings Conference Call. Today's ...