Portfolio Overview - As of December 31, 2022, the company's portfolio totaled $1,196.0 million, consisting of $661.2 million in first lien secured debt, $130.8 million in second lien secured debt, $148.6 million in subordinated debt, and $255.4 million in preferred and common equity[207]. - The overall portfolio had a net unrealized depreciation of $167.5 million as of December 31, 2022, with an average investment size of $9.6 million across 125 companies[207]. - As of September 30, 2022, the portfolio totaled $1,226.3 million, with a weighted average yield on interest-bearing debt investments of 10.8%[208]. - As of December 31, 2022, the PennantPark Senior Loan Fund's portfolio totaled $734.7 million, consisting of 83 companies with a weighted average yield on debt investments of 10.6%[211]. - The investment portfolio of PSLF consisted of debt investments in 83 portfolio companies as of December 31, 2022, up from 80 companies as of September 30, 2022[268]. Investment Activity - For the three months ended December 31, 2022, the company invested $86.2 million in six new and 29 existing portfolio companies, achieving a weighted average yield on debt investments of 11.2%[209]. - For the three months ended December 31, 2021, the company invested $295.1 million in 15 new and 30 existing portfolio companies, with a weighted average yield on debt investments of 8.1%[210]. - The company aims to create a diversified portfolio by investing approximately $10 million to $50 million in middle-market companies, defined as those with annual revenues between $50 million and $1 billion[198]. Financial Performance - For the three months ended December 31, 2022, investment income was $30.0 million, an increase from $28.3 million in the same period of 2021, primarily due to higher cost yield of the debt portfolio[240]. - Net investment income for the three months ended December 31, 2022, was $10.3 million, or $0.16 per share, compared to $12.5 million, or $0.19 per share in the prior year[242]. - Total expenses for the three months ended December 31, 2022, were $19.6 million, up from $15.8 million in the same period of 2021, with debt-related interest and expenses increasing significantly[241]. - The company declared distributions of $0.17 per share for a total of $10.8 million during the three months ended December 31, 2022, up from $0.12 per share totaling $8.0 million in the prior year, indicating a 35% increase in total distributions[285]. Valuation and Risk Management - The fair value of investments is determined using a multi-step valuation process, with most investments classified as Level 3 due to lack of readily available market values[219]. - The company does not accrue PIK interest on loans and debt investments if it is deemed uncollectible based on portfolio company valuations[225]. - The company’s quarterly valuation process includes independent appraisals for investments where market quotations are not readily available[222]. - The board of directors periodically assesses material valuation risks and has complied with SEC Rule 2a-5 under the 1940 Act since before its compliance date[220]. Debt and Liabilities - As of December 31, 2022, the company had $380.9 million in outstanding borrowings under the Truist Credit Facility, with a weighted average interest rate of 6.6%[251]. - The company reported liabilities of $688.003 million as of December 31, 2022, compared to $696.825 million as of September 30, 2022, showing a decrease of 1.2%[282]. - The weighted average cost of debt for the three months ended December 31, 2022, was 5.6%, compared to 4.0% in the same period of 2021[250]. Cash and Equivalents - As of December 31, 2022, cash and cash equivalents amounted to $28.6 million, down from $52.7 million as of September 30, 2022[265]. - Total cash and cash equivalents held is $35.71 million[276]. Interest Rate Sensitivity - The debt portfolio consisted of 96.0% variable-rate investments and 4.0% fixed-rate investments as of December 31, 2022[292]. - A 1% decrease in interest rates results in a decrease of $5,378 in net interest income, equating to a $0.08 decrease in expense per share[294]. - A 1% increase in interest rates results in an increase of $5,378 in net interest income, equating to a $0.08 increase in expense per share[294]. - The company's net investment income is dependent on the difference between borrowing rates and investment rates, as well as the level of leverage[295]. Shareholder Equity - Members' equity stands at $88.94 million, reflecting a 100.0% increase[276]. - The net increase in members' equity resulting from operations for the three months ended December 31, 2022, was $1.608 million, down from $3.725 million in the same period of the previous year, a decrease of 56.9%[282].

Financial Data and Key Metrics Changes - For the quarter ended September 30, core net investment income was $0.18 per share, excluding one-time financing costs, while net investment income totaled $0.14 per share including $0.01 per share of other income [20][37] - The company's net asset value (NAV) per share decreased by 6.9% to $8.98 from $9.65 in the prior quarter, primarily due to unrealized mark-to-market adjustments [21][40] - The weighted average yield to maturity on the debt portfolio increased to 10.8% from 9.3% in the previous quarter [15] Business Line Data and Key Metrics Changes - The debt portfolio remains diversified with 123 companies across 32 different industries, with 51% in first lien secured debt and 11% in second lien secured debt [41] - The company invested $134 million in new and existing portfolio companies during the quarter, with sales and repayments totaling $176 million [19] Market Data and Key Metrics Changes - Approximately 96% of the company's assets are floating rate, compared to 47% of liabilities that are fixed rate, positioning the company well to benefit from rising interest rates [15] - The weighted average debt-to-EBITDA ratio on the portfolio was 4.6 times, and the average interest coverage ratio was 3.6 times, indicating a strong capacity to cover interest expenses [31] Company Strategy and Development Direction - The company focuses on capital preservation and is well-positioned as a lender in the current market environment characterized by inflation and rising interest rates [9][10] - The strategy includes optimizing the portfolio and balance sheet, growing the PSLF joint venture to $1 billion, and rotating out of equity investments into cash pay yield instruments [22] - The company aims to generate attractive risk-adjusted returns through income while preserving capital, targeting high-growth middle market companies with strong free cash flow [35] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the quality of new loans and the attractiveness of the current vintage, citing lower leverage and tighter covenants [19][34] - The company believes that the borrowers in its investment portfolio are performing well and is optimistic about future quarters [31] Other Important Information - The Board of Directors approved a quarterly dividend increase to $0.165 per share, payable on January 3, 2023 [13] - The company completed an amendment and extension of its Truist Credit Facility, increasing its size from $465 million to $500 million and extending the maturity to 2027 [17] Q&A Session Summary Question: Ability to buy first lien loans in the secondary market - Management indicated that these loans are typically from companies they have previously financed, allowing them to buy at a discount and expect a return to par over time [49][50] Question: Upfront fee for credit facility amendment - Management explained that the upfront fee is taken as a one-time expense due to accounting obligations, which is considered shareholder-friendly as it avoids ongoing expenses [52][54] Question: Mark on RAM Energy investment - Management clarified that RAM Energy is performing well, and the markdown was influenced by external market factors, particularly the price of oil and gas [70][72] Question: Evaluation of secondary purchases - Management stated that each investment is evaluated on its own merits, comparing potential returns from secondary purchases against new loans [76] Question: Equity co-investment strategy - Management emphasized that equity co-investments are generally part of their strategy, particularly in buy-and-build scenarios, and are not typically a trade-off against yield [80][81]

Pennantpark Investment Corp (NYSE:PNNT) Q3 2022 Earnings Conference Call August 4, 2022 12:00 PM ET Company Participants Arthur Penn - Founder, Chairman, Managing Partner & CEO Richard Allorto - CFO Conference Call Participants Paul Johnson - KBW Robert Dodd - Raymond James & Associates Mickey Schleien - Ladenburg Thalmann & Co. Casey Alexander - Compass Point Research & Trading Melissa Wedel - JPMorgan Chase & Co. Operator Good afternoon, and welcome to the PennantPark Investment Corporation's Third Fisca ...

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, 2022 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) MARYLAND 20-8250744 (State or ot ...

PennantPark Investment Corporation (NYSE:PNNT) Q2 2022 Earnings Conference Call May 5, 2022 12:00 PM ET Company Participants Art Penn – Chairman and Chief Executive Officer Richard Cheung – Chief Financial Officer Conference Call Participants Paul Johnson – KBW Robert Dodd – Raymond James Mickey Schleien – Ladenburg Melissa Wedel – JPMorgan Operator Good afternoon, and welcome to the PennantPark Investment Corporation's Second Fiscal Quarter 2022 Earnings Conference Call. Today's conference is being recorde ...

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 MARCH 31, 2022 (Exact name of registrant as specified in its charter) MARYLAND 20-8250744 (State or other jurisdiction of incorporation or organization) (I.R.S. Employer Identification No.) 1691 Michigan Avenue, Miami Beach, Florida 33319 (212) 905-1000 (Registrant's Telephone Number, Including Ar ...

PennantPark Investment (NYSE:PNNT) Q1 2022 Earnings Conference Call February 10, 2022 12:00 PM ET Company Participants Art Penn – Chairman and Chief Executive Officer Richard Cheung – Chief Financial Officer Conference Call Participants Casey Alexander – Compass Point Robert Dodd – Raymond James Ryan Lynch – KBW Mickey Schleien – Ladenburg Kyle Joseph – Jeffries Melissa Wedel – J.P. Morgan Operator Good afternoon, and welcome to the PennantPark Investment Corporation's First Fiscal Quarter 2022 Earnings Con ...

Investment Strategy and Portfolio - PennantPark Investment Corporation aims to generate current income and capital appreciation through debt and equity investments primarily in U.S. middle-market companies, with average investments ranging from $10 million to $50 million [163]. - As of December 31, 2021, the company's portfolio totaled $1,445.4 million, with 93% in variable-rate investments and a weighted average yield on interest-bearing debt investments of 8.8% [182]. - For the three months ended December 31, 2021, the company invested $295.1 million in 15 new and 30 existing portfolio companies, with a weighted average yield on debt investments of 8.1% [184]. - The PennantPark Senior Loan Fund (PSLF) portfolio totaled $421.5 million as of December 31, 2021, consisting of 54 companies with an average investment size of $7.8 million and a weighted average yield of 7.2% [186]. - The portfolio includes a diverse range of industries, with significant investments in media, healthcare, and aerospace sectors [243]. - The company maintains a focus on floating rate instruments, which are indexed to LIBOR or Prime rates [243]. Financial Performance - For the three months ended December 31, 2021, investment income was $28.3 million, an increase from $18.7 million in the same period of 2020, primarily due to growth in the debt portfolio [212]. - Net investment income for the three months ended December 31, 2021, was $12.5 million, or $0.19 per share, compared to $8.3 million, or $0.12 per share, in the same period of 2020 [214]. - Total expenses for the three months ended December 31, 2021, were $15.8 million, up from $10.4 million in the same period of 2020, mainly due to increased financing costs and incentive fees [213]. - The net change in unrealized appreciation on investments for the three months ended December 31, 2021, was $46.8 million, down from $93.5 million in the same period of 2020 [216]. - The company reported a net realized and unrealized gain from investments of $504,913 for the three months ended December 31, 2021, down from $3,174,589 in the same period of 2020 [248]. Debt and Financing - The debt portfolio consisted of 93% variable-rate investments as of December 31, 2021, which are typically based on a floating interest rate index such as LIBOR [173]. - The Truist Credit Facility had outstanding borrowings of $445.2 million as of December 31, 2021, with a weighted average interest rate of 2.4% [223]. - The company had $150.0 million in aggregate principal amount of 2026 Notes outstanding, with an interest rate of 4.50% per year [225]. - The annualized weighted average cost of debt for Q4 2021 was 4.0%, compared to 3.4% in Q4 2020 [222]. - PSLF has a senior secured revolving credit facility of $275.0 million, increased from $250.0 million, with interest at LIBOR plus 260 basis points [242]. Impact of COVID-19 - The ongoing COVID-19 pandemic has created significant financial distress for portfolio companies, particularly in vulnerable sectors like retail and travel, potentially leading to defaults on financial obligations [169]. - The company has reduced distributions to stockholders compared to previous years due to the adverse effects of the COVID-19 pandemic on net investment income [171]. - The impact of the COVID-19 pandemic may lead to increased capital requirements for portfolio companies, necessitating follow-on investments [171]. - The company has implemented a business continuity planning strategy to safeguard employee health and ensure operational continuity during the pandemic [174]. Asset Coverage and Distributions - As of December 31, 2021, the asset coverage ratio was 190%, down from 221% as of September 30, 2021 [222]. - The company declared an increase in its second fiscal quarter 2022 distribution to $0.14 per share, payable on April 1, 2022 [249]. - The company declared distributions of $0.12 per share, totaling $8.0 million for the three months ended December 31, 2021, consistent with the prior year [254]. - The company may face limitations on distributions due to asset coverage ratios and could suffer adverse tax consequences if certain income distribution levels are not met [257]. Liquidity and Capital Resources - The company reported cash and cash equivalents of $39.6 million as of December 31, 2021, an increase from $20.4 million as of September 30, 2021 [236]. - Operating activities used cash of $177.4 million for the three months ended December 31, 2021, while financing activities provided cash of $196.6 million during the same period [237]. - The company’s liquidity and capital resources are deemed sufficient to take advantage of market opportunities [236]. - Cash and cash equivalents increased to $22,154,890 as of December 31, 2021, from $11,013,454 as of September 30, 2021, showing a significant increase of about 100% [246]. Valuation and Accounting - The company employs a multi-step valuation process for investments without readily available market values, ensuring fair value assessments are made in good faith [190]. - The company’s revenue recognition includes recording interest income on an accrual basis, with specific treatment for PIK interest and loan origination fees [200]. - The company has adopted ASC 825-10 for its Credit Facilities, aligning measurement attributes of both assets and liabilities to mitigate earnings volatility [196]. - The company intends to maintain its election to be treated as a RIC under Subchapter M of the Code, requiring annual distributions of at least 90% of net ordinary income and realized net short-term capital gains [204].

PennantPark Investment Corporation (NYSE:PNNT) Q4 2021 Earnings Conference Call November 18, 2021 12:00 PM ET Company Participants Art Penn - Chairman and Chief Executive Officer Richard Cheung - Chief Financial Officer Conference Call Participants Casey Alexander - Compass Point Robert Dodd - Raymond James Ryan Lynch - KBW Mickey Schleien - Ladenburg Kyle Joseph - Jefferies Melissa Wedel - JPMorgan Jim Altschul - Aviation Advisory Service Operator Good morning and welcome to the PennantPark Investment Corp ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-K (Mark One) ☒ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2021 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) MARYLAND 20-8250744 (State or other ...