Financial Data and Key Metrics Changes - Total investment income increased by 11% to $2.1 million in Q4 2024, with full-year investment income rising 17% to $8.6 million compared to the previous year [10][36] - Net asset value per share grew by 7% year-over-year, reaching $25.31 at year-end [11][43] - Total expenses for Q4 2024 were a credit of $376,000, compared to an expense of $1 million in Q4 2023, primarily due to a decrease in capital gains incentive fee expense [37][38] Business Line Data and Key Metrics Changes - Debt investments now make up 75% of the portfolio, up from 64% in 2023, contributing to improved yields and earnings stability [12][21] - The annualized weighted average yield of debt investments was 13.8% as of December 31, 2024, an increase of 20 basis points over 2023 [22] - The number of portfolio companies contributing to investment income decreased from 26 in 2023 to 25 in 2024 [36] Market Data and Key Metrics Changes - The portfolio's fair value decreased by 8% from the end of 2023, primarily due to the successful exit from SciAps [20] - Exposure to professional services increased from 42% to 48%, while manufacturing and software saw a relative decline [28] Company Strategy and Development Direction - The company is focused on creating long-term value for shareholders through disciplined capital allocation and managing a more income-generating portfolio [15][50] - The strategic shift towards income-producing investments is expected to support sustained higher dividend levels over time [45] - The company aims to capitalize on opportunities in the lower middle market, particularly family-owned businesses facing succession challenges [49] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the potential for recovery in portfolio valuations, particularly if consumer spending stabilizes [55] - The company is monitoring macroeconomic trends, including potential interest rate reductions, which could enhance portfolio performance [15][52] - Management emphasized the importance of proactive risk management in navigating economic and political uncertainties [54] Other Important Information - The company declared a total of $4.3 million in cash dividends during 2024, with a quarterly cash dividend increase of 16% to $0.29 per share [14][45] - The company successfully exited its investment in SciAps, generating $13.1 million in total proceeds and a realized gain of $7.7 million [25] Q&A Session Summary Question: What are the expectations for future dividend growth? - Management indicated confidence in the ability to sustain and potentially increase dividends due to the strategic shift towards income-generating investments [45][55] Question: How does the company plan to navigate economic uncertainties? - The company plans to maintain a diversified portfolio and proactive risk management to adapt to changing market conditions [54][55]

Management Fees and Incentives - The Base Management Fee is set at an annual rate of 1.50% of total assets, excluding cash[41]. - The Incentive Fees consist of an Income Based Fee and a Capital Gains Fee, with the Income Based Fee calculated quarterly based on Pre-Incentive Fee Net Investment Income[42][53]. - The hurdle rate for Pre-Incentive Fee Net Investment Income is 1.75% per quarter, equating to 7% annualized[46]. - If Pre-Incentive Fee Net Investment Income exceeds 2.1875% (8.75% annualized), the Income Based Fee is 20% of the amount above this threshold[51]. - The Capital Gains Fee is calculated at 20% of the positive difference between cumulative realized capital gains and cumulative realized capital losses at the end of each calendar year[53]. Investment Management and Operations - The Investment Committee, led by Daniel Penberthy and Scott Barfield, is responsible for all investment decisions[37]. - RCM did not utilize any Sub-Advisors for investment advice in the calendar year 2024[36]. - The company has no employees; operations are managed by RCM, the investment adviser[34]. - The Investment Committee's experience provides a competitive advantage in managing investments in lower middle-market companies[38]. - The company reimburses RCM for overhead and other expenses incurred in performing its obligations under the Administration Agreement[35]. Financial Performance and Results - Total assets decreased from $81,021,982 in 2023 to $72,457,433 in 2024, a decline of approximately 10.3%[306]. - Total investment income increased to $8,559,285 in 2024, up 16.6% from $7,338,163 in 2023[308]. - Net investment income rose to $3,425,077 in 2024, representing a 15.4% increase compared to $2,967,733 in 2023[308]. - Net realized gain on sales and dispositions of investments surged to $11,124,864 in 2024, compared to $691,397 in 2023, marking a significant increase[308]. - The net change in unrealized appreciation/depreciation on investments was a loss of $5,722,329 in 2024, contrasting with a gain of $2,867,520 in 2023[308]. Asset Coverage and Regulatory Compliance - The asset coverage ratio as of December 31, 2024, was 10,988.8%, significantly higher than the 474.2% recorded in 2023[79]. - The modified asset coverage requirement under the 1940 Act will change from 200% to 150%, effective January 24, 2025[78]. - A BDC must ensure that qualifying assets represent at least 70% of total assets at the time of acquisition[80]. - Non-qualifying investments may not exceed 30% of the BDC's total asset value[82]. - The Corporation must meet specified source-of-income and asset-diversification requirements to maintain RIC qualifications[84]. Risks and Challenges - Political and regulatory conditions, including the impact of the 2024 U.S. presidential election, could materially affect business operations and financial performance[98]. - RCM faces competition from larger entities with greater financial resources, which may impact the company's ability to secure favorable investment terms[100]. - The company may face cybersecurity risks that could impair operations and negatively impact financial condition and operating results[125]. - The company has a limited number of portfolio companies, increasing risk if any of these companies default, which could significantly impact net asset value[128]. - Economic downturns may negatively affect the financial performance of portfolio companies, impacting the company's overall financial performance[130]. Investment Strategy and Portfolio Composition - The company invests primarily in small private companies, which may present a greater risk of loss compared to larger companies due to limited access to capital and higher funding costs[137]. - The company’s investments are primarily in debt securities, which may rank equal to or senior to its investments, posing risks in insolvency scenarios[142]. - The Corporation's investment strategy includes a focus on restricted securities, which represented 100% of the fair value of the investment portfolio as of December 31, 2024[323]. - The portfolio includes significant investments in Professional and Business Services at 47.6%, followed by Consumer Products at 17.7%[332]. - Total investments amount to $68,120,235, with a fair value of $70,818,041, indicating an investment leverage of 108.4%[319]. Debt and Financing - As of December 31, 2024, the company had $600,000 in principal amount of outstanding indebtedness under its Credit Facility, with an annualized interest cost of 8.91%[151]. - The company’s ability to service existing and future debt depends largely on its financial performance, which is influenced by the performance of its portfolio companies and prevailing economic conditions[148]. - The company may face increased investment risk due to the potential increase in its maximum debt-to-equity ratio from one-to-one to two-to-one under the new asset coverage requirements[160]. - The company’s net investment income may be adversely affected by rising market interest rates, which could increase its cost of capital under its Credit Facility[157]. - The company is subject to risks related to its indebtedness, including the potential for loss magnification due to leverage[147]. Shareholder and Corporate Governance - East beneficially owns approximately 64% of the company’s outstanding common stock, allowing it to significantly influence corporate decisions[165]. - Conflicts of interest may arise from RCM managing multiple funds, potentially impacting investment returns for the company[101]. - The company is prohibited from certain transactions with affiliates without prior approval, which may restrict investment flexibility[104]. - The company is required to distribute at least 90% of its net ordinary income and realized net short-term capital gains to maintain RIC tax treatment[174]. - The company declared dividends totaling $12,982,536 in 2024, significantly higher than $3,432,757 in 2023[310].

Investment Performance - Total investment income increased by 11% to $2.1 million in Q4 2024, contributing to a full-year increase of 17% to $8.6 million[5] - Total investment income for 2024 reached $8,559,285, a 16.6% increase from $7,338,163 in 2023[26] - Net investment income for 2024 was $3,425,077, up 15.4% from $2,967,733 in 2023[26] - Rand Capital reported a 17% growth in net investment income, reaching $3,425,077 in 2024 compared to $2,967,733 in 2023[29] - Control investments generated $733,774 in interest income for 2024, compared to $698,872 in 2023, marking a growth of 5%[26] - Affiliate investments contributed $4,739,802 in interest income for 2024, a 22.8% increase from $3,858,696 in 2023[26] - The company reported a net realized gain on sales of investments of $11,124,864 for 2024, compared to $691,397 in 2023, indicating a substantial increase[26] - The net realized gain on sales and dispositions of investments significantly increased to $11,124,864 in 2024 from $691,397 in 2023[29] Financial Position - Net asset value per share grew by 7% year-over-year to $25.31[5] - Total assets decreased to $72,457,433 in 2024 from $81,021,982 in 2023, representing a decline of 10.3%[24] - Total liabilities significantly reduced to $7,124,913 in 2024 from $20,206,769 in 2023, a decrease of 64.8%[24] - Stockholders' equity increased to $65,332,520 in 2024, up from $60,815,213 in 2023, reflecting an increase of 7.5%[24] - The net assets at the end of 2024 were $65,332,520, up from $60,815,213 at the beginning of the year[29] Dividends and Returns - Total dividends declared in 2024 amounted to $5.03 per share, including a 16% increase in the regular quarterly cash dividend[4] - Rand Capital declared dividends totaling $12,982,536 in 2024, significantly higher than $3,432,757 in 2023[29] Debt Management - Debt investments now account for 75% of Rand's portfolio, up from 64% at the end of 2023, enhancing yields and net interest income[5] - Outstanding bank debt was reduced by $15.7 million year-over-year, with over $24 million in remaining availability at December 31, 2024[5] - The company plans to continue strategic debt investments to enhance future growth prospects[25] - The company continues to focus on strategic debt investments to enhance its financial performance[30] Strategic Investments - Strategic capital deployment of nearly $14 million during 2024 positions Rand for continued growth in 2025[5] - Rand funded a new investment of $2.9 million in Mobile IV Nurses Management LLC, consisting of a $2.5 million term loan and a $375,000 equity investment[19] Expenses - Total expenses for the year ended December 31, 2024, were $4,837,282, up from $4,178,319 in 2023[32] - Adjusted total expenses for 2024 were $3,824,982, compared to $3,373,619 in 2023[32] Cash Reserves - Cash reserves decreased to $834,805 in 2024 from $3,295,321 in 2023, a decline of 74.7%[24] Unrealized Gains and Losses - The net change in unrealized appreciation/depreciation on investments was a loss of $5,722,329 in 2024, contrasting with a gain of $2,867,520 in 2023[29]

Financial Data and Key Metrics Changes - Total investment income increased by 27% year-over-year to $2.2 million, driven by a rise in interest income and enhanced fee income [6][17] - Net asset value per share rose 3% from the prior quarter and 16% year-to-date, reaching $27.29 at the end of Q3 2024 [7][23] - Net investment income for Q3 increased to $887,000 or $0.34 per share, up from $799,000 or $0.31 per share in the same period last year [21] - Total expenses for Q3 amounted to approximately $1.3 million, up from $810,000 in the prior quarter, primarily due to an increase in incentive fees [18] Business Line Data and Key Metrics Changes - The portfolio now stands at a fair value of $75 million, with 74% concentrated in debt investments and 26% in equity investments [7][11] - The company successfully exited several key investments, including a notable sale of SciAps, generating $13.1 million in proceeds [8][12] - A follow-on debt investment of $125,000 was made in ITA, increasing total holdings in ITA to a fair value of $4.9 million [12] Market Data and Key Metrics Changes - The fair value of the portfolio decreased by approximately 14% sequentially, reflecting successful exits and stock sales [11] - The professional services allocation increased from 43% to 50% of the portfolio, while manufacturing decreased from 25% to 16% [14] Company Strategy and Development Direction - The company aims to expand its debt portfolio while maintaining equity exposure for long-term gains [26] - There is a commitment to optimizing portfolio holdings to maximize future returns amid complex market conditions [28] - The strategy includes supporting portfolio companies to navigate economic challenges, thereby enhancing their resilience [28] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the potential for income growth through targeted strategic originations and efficient capital deployment [27] - The company is positioned to benefit from recent Fed rate reductions, which are expected to lower borrowing costs and enhance profitability [27] - There is a strong commitment to driving shareholder returns through increased dividends and sustainable long-term value [29] Other Important Information - The company distributed $748,000 in cash dividends to shareholders during the quarter [23] - Total liquidity stood at $24 million, providing strategic positioning for future investments [9] Q&A Session Summary - The Q&A session concluded without specific questions or answers being documented in the provided content.

Financial Position - Total assets decreased by 1.5% to $79,798,119 as of September 30, 2024, from $81,021,982 at December 31, 2023[143]. - Total liabilities decreased significantly by 53.7% to $9,351,483 from $20,206,769[143]. - Net assets increased by 15.8% to $70,446,636, compared to $60,815,213 at the end of 2023[143]. - Net asset value per share (NAV) rose to $27.29 at September 30, 2024, up from $23.56 at December 31, 2023[143]. Investment Performance - Total investment income for the three months ended September 30, 2024, was $2,218,454, an increase of 27.4% compared to $1,741,114 for the same period in 2023[151]. - Interest from portfolio companies increased by $409,918, or 26.7%, to $1,945,595 for the three months ended September 30, 2024, due to additional interest-yielding investments[151][154]. - Realized gain on investments for the three months ended September 30, 2024, was $7,230,082, a significant increase of $10,032,813 compared to a loss of $2,802,731 in the same period in 2023[160]. - The company recognized a realized gain of $7,699,879 from the sale of its investment in SciAps during the three months ended September 30, 2024[160]. - The company recognized a realized gain on investments before income taxes of $11,108,282 for the nine months ended September 30, 2024, a substantial increase from $1,068,904 in the same period of 2023[175]. Expenses and Income - Total expenses for the three months ended September 30, 2024, were $1,333,930, representing a 64.7% increase from $809,936 in the same period in 2023[158]. - Net investment income for the three months ended September 30, 2024, was $887,035, compared to $798,583 for the same period in 2023[160]. - Total expenses for the nine months ended September 30, 2024, were $5,213,568, representing a 64.8% increase from $3,164,522 in the same period of 2023[172]. - Net investment income for the nine months ended September 30, 2024, was $1,209,425, down from $2,006,129 in the same period of 2023[173]. Cash Flow and Liquidity - As of September 30, 2024, the company had total liquidity of approximately $24,453,000, consisting of $3,353,000 in cash and $21,100,000 available on the Credit Facility[182]. - The company experienced a net cash increase of approximately $57,000 for the nine months ended September 30, 2024, driven by $14,550,000 from operating activities and $14,492,000 used in financing activities[186]. - Net cash used in financing activities during the nine months ended September 30, 2024, was approximately $14,492,000, which included $12,350,000 repaid on the Credit Facility and approximately $2,142,000 in dividends paid to shareholders[188]. Investment Strategy and Future Outlook - The company anticipates continuing to fund investment activities through cash generated from ongoing operations and borrowings under the $25 million Credit Facility[189]. - The company plans to continue exiting investments, although the timing of liquidation events for privately held investments is difficult to project[189]. - The company does not currently engage in any hedging activities but may consider using futures, options, and forward contracts in the future to hedge against interest rate fluctuations[192]. Valuation and Market Conditions - The company carries its investments at fair value, which requires judgment and may involve material risks due to the uncertainty of determining fair value[193]. - Changes in market conditions and other events may cause the realized value of investments to differ from assigned valuations[193]. - The company’s valuation process considers factors such as third-party valuations, the portfolio company's payment ability, and comparisons to publicly-traded securities[193].

Financial Data and Key Metrics Changes - Total investment income for Q2 2024 was $2.1 million, an 18% increase compared to the same quarter last year, driven by a 35% increase in interest income from 7 new interest-yielding investments [11] - Total expenses for the quarter were approximately $2.7 million, up from $1.3 million in the same quarter last year, primarily due to a $1.2 million rise in capital gain incentive fees [11] - Net investment loss was $517,000 or $0.20 per share, compared to a net investment income of $493,000 or $0.19 per share in the prior year [12] - Net assets at June 30, 2024, were $68.6 million, reflecting an 11% increase, largely due to unrealized appreciation on investments of $7.8 million [12] Business Line Data and Key Metrics Changes - The portfolio had a fair value of $87.1 million across 26 businesses, up 13% from year-end 2023 and 5% sequentially [7] - The portfolio is comprised of approximately 66% debt investments with an annualized weighted average yield of 13.8% [7] - The largest fair value investment, Tilson, increased by 17% to $12.3 million, while SciAps' value more than doubled to $10.8 million following a purchase agreement [10] Market Data and Key Metrics Changes - Manufacturing increased from 20% to 25% of the portfolio, while BDC stocks decreased from 5% to 2% [9] - The company received $3.3 million in total proceeds from liquidating shareholdings in 3 BDC investments, resulting in realized gains [8] Company Strategy and Development Direction - The company aims to expand by pursuing new investments and reinvesting in existing portfolio companies with high potential [15] - The strategy includes participating in smaller M&A transactions to support a steady income stream through new debt instruments [15] - The focus remains on debt financing for lower to middle market businesses while maintaining minority equity investments [16] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the strategy of transforming the portfolio to include more income-generating investments, which is expected to sustain higher dividend levels over time [13] - The anticipated capital infusion from the acquisition of SciAps will be strategically redeployed to drive further value for shareholders [5] Other Important Information - The company declared total dividends of $0.83 per share year-to-date, including a cash dividend of $0.29 per share for Q2 [6] - Total available liquidity at quarter end was over $11 million, including cash on hand and remaining highly liquid publicly traded BDC securities [6] Q&A Session Summary - The Q&A session concluded without specific questions or answers being documented in the provided content.

Financial Performance - Total assets increased by 12.1% to $90,789,069 as of June 30, 2024, compared to $81,021,982 at December 31, 2023[142] - Net assets rose by 12.7% to $68,558,616 at June 30, 2024, up from $60,815,213 at the end of 2023[142] - The net asset value per share (NAV) was $26.56 at June 30, 2024, compared to $23.56 at December 31, 2023[142] - Total investments at fair value increased by 12.9% to $87,070,967 as of June 30, 2024, from $77,125,712 at December 31, 2023[145] - Unrealized appreciation, net, surged by 55.8% to $13,648,836 at June 30, 2024, compared to $8,760,106 at the end of 2023[145] - Total investment income for the three months ended June 30, 2024, was $2,136,149, representing a 17.7% increase from $1,815,432 in the same period of 2023[149] - Total investment income for the six months ended June 30, 2024, was $4,203,368, representing a 14.6% increase from $3,666,930 in the same period of 2023[168] - Net investment income for the six months ended June 30, 2024, was $322,390, a significant decrease from $1,207,546 in the same period of 2023[175] Investment Activities - New investments totaled $10,945,497 during the six months ended June 30, 2024[148] - The company liquidated investments in Ares, Carlyle, Knoa, and Pennantpark during the three months ended June 30, 2024[161] - The company funded approximately $10,945,000 in new or follow-on portfolio company investments during the same period[190] Dividends and Expenses - The company declared quarterly cash dividends of $0.25 and $0.29 for the first and second quarters of 2024, respectively[139] - Total expenses rose significantly by 103.0% to $2,652,782 in Q2 2024, up from $1,306,741 in Q2 2023, primarily driven by a $1,150,000 increase in capital gains incentive fee expense[152] - Total expenses rose by 64.8% to $3,879,638 for the six months ended June 30, 2024, up from $2,354,586 in 2023, primarily due to increased capital gains fee expenses and interest expenses[172] Cash Flow and Liquidity - As of June 30, 2024, total liquidity consisted of approximately $2,293,000 in cash and $7,800,000 available on the Credit Facility[186] - The company entered into a $25 million Credit Facility with an outstanding balance of $17.2 million as of June 30, 2024, leaving an unused line of credit of $7.8 million[187] - For the six months ended June 30, 2024, the company experienced a net decrease in cash of approximately $1,002,000, primarily due to $558,000 used in operating activities and $444,000 in financing activities[190] Financial Risks and Management - The company is subject to financial market risks, including interest rate changes that may affect its interest expense on the debt outstanding under the Credit Facility[192] - A hypothetical 1% increase in interest rates could decrease net investment income by approximately $172,000, while a 1% decrease could increase it by the same amount[194] - The company does not currently engage in hedging activities but may consider them in the future to manage interest rate fluctuations[195] Future Outlook - SciAps announced a definitive purchase agreement for acquisition with total consideration of up to $260 million, expected to close later in 2024[162] - SciAps announced a definitive purchase agreement for up to $260 million, with closing expected later in 2024, which may impact future valuations[181] Investment Strategy - The company’s investment objective focuses on generating current income and capital appreciation through investments in lower middle market companies[146] - The company has co-investment opportunities with affiliates under an SEC exemptive order, enhancing investment diversification[140] Performance Metrics - Interest from portfolio companies increased by 35.4% to $1,995,227 in Q2 2024, compared to $1,473,540 in Q2 2023, due to additional interest-yielding investments[150] - Interest from portfolio companies increased by 37.5% to $3,808,875 for the six months ended June 30, 2024, compared to $2,770,443 in 2023, due to additional interest-yielding investments[169] - The net increase in net assets from operations for the three months ended June 30, 2024, was $7,737,773, compared to $2,671,890 in the same period of 2023[164] - The net increase in net assets from operations for the six months ended June 30, 2024, was $9,137,154, compared to $4,842,167 in 2023[185] - The change in unrealized appreciation of investments was $7,779,026 for Q2 2024, a significant improvement from a depreciation of ($1,367,270) in Q2 2023[159] - The change in unrealized appreciation of investments before income taxes for the six months ended June 30, 2024, was $4,888,730, compared to $34,703 in 2023, indicating a substantial increase[179]

Investment Performance - Total investment income increased by 18% to $2.1 million for Q2 2024, driven by a 35% increase in interest from portfolio companies[3] - Total investment income increased by 18% to $2,136,149 for the three months ended June 30, 2024, compared to $1,815,432 for the same period in 2023[16] - Adjusted net investment income per share was $0.44, a 16% increase from $0.38 per share in Q2 2023[5] - Basic and diluted net increase in net assets from operations per share was $3.00 for the three months ended June 30, 2024, compared to $1.04 for the same period in 2023[17] - Net investment (loss) income per share for the three months ended June 30, 2024, is $(0.20), a decrease from $0.19 for the same period in 2023[22] - Excluding expenses for capital gains incentive fees, net investment income per share was $0.64 for the three months ended June 30, 2024, up from $0.19 in the same period of 2023[22] - For the six months ended June 30, 2024, net investment (loss) income per share was $0.12, down from $0.47 for the same period in 2023[22] - The adjusted net investment income per share for the six months ended June 30, 2024, was $0.80, compared to $0.77 in the same period last year[22] Financial Position - Net asset value per share rose to $26.56 at June 30, 2024, reflecting an 11% increase from March 31, 2024, and a 13% increase from year-end 2023[1] - As of June 30, 2024, Rand's portfolio had a fair value of $87.1 million, a 13% increase from December 31, 2023[6] - Net assets at the end of the period were $68,558,616 as of June 30, 2024, compared to $61,402,028 at the same time in 2023[18] Expenses and Costs - Total expenses for Q2 2024 were $2.7 million, up from $1.3 million in the same period last year, primarily due to a $1.2 million increase in capital gains incentive fees[4] - Total expenses for the three months ended June 30, 2024, were $2,652,782, compared to $1,306,741 for the same period in 2023[20] - Adjusted total expenses, excluding capital gains incentive fees, were $1,011,782 for the three months ended June 30, 2024[20] Debt Management - Rand reduced its debt balance by $2.0 million during the quarter, with an additional $2.3 million repaid subsequent to quarter-end[1] - The annualized weighted average yield of debt investments was 13.8% at June 30, 2024, compared to 13.6% at the end of 2023[6] Dividends - A quarterly dividend of $0.29 per share was announced for Q3 2024, consistent with previous distributions[1] - The company declared a dividend of $(748,496) for the three months ended June 30, 2024, compared to $(645,255) in the same period last year[18] Investment Gains and Losses - Net investment (loss) income before income taxes was $(516,633) for the three months ended June 30, 2024, compared to $508,691 for the same period in 2023[16] - Net realized gain on sales and dispositions of investments was $428,108 for the three months ended June 30, 2024, down from $3,480,089 in the same period last year[18] - The company reported a net change in unrealized appreciation on investments of $7,826,860 for the three months ended June 30, 2024[18] Future Outlook - The company expects to leverage capital from the pending sale of portfolio investment company SciAps, anticipated to close later this year[2] - Rand's total debt and equity investment in SciAps had a fair value of $10.8 million at quarter-end[7]

Financial Data and Key Metrics Changes - Total investment income for Q1 2024 was $2.1 million, a 12% increase from the previous year's first quarter, driven by a 40% increase in interest income [17] - Net investment income increased 17% to $840,000 or $0.33 per share compared to $715,000 or $0.28 per share in Q1 2023 [18] - Total expenses were approximately $1.2 million in Q1 2024, up from $1 million in the prior year's first quarter [9] - Net assets at March 31, 2024, were $61.6 million, a 1% increase from the end of 2023 [31] Business Line Data and Key Metrics Changes - The portfolio comprised approximately 70% in debt investments, up from 64% at the end of 2023, with an annualized weighted average yield of 13.7% [14][25] - The company completed one follow-on and two new investments during the quarter, including a $5.5 million debt investment in Madison Avenue Holdings [14][26] - The fair value of the portfolio increased to $82.8 million across 30 portfolio businesses, up $5.6 million or 7% from the end of 2023 [26] Market Data and Key Metrics Changes - The company observed growth in sectors such as professional services, consumer products, and distribution, while declines were noted in manufacturing and software industries [7] - The company liquidated approximately $3 million worth of BDC stocks post-quarter end to safeguard accrued gains [22] Company Strategy and Development Direction - The company aims to maximize shareholder value through sustained growth of dividends and strategic investments in income-generating debt instruments [34] - The strategic shift towards a higher proportion of debt investments is expected to support increased dividend levels over time [20][34] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the ability to replicate historical achievements and deliver compelling returns for shareholders [22] - The company highlighted the importance of maintaining a strong and flexible balance sheet for future investments [19] Other Important Information - The company declared total dividends of $0.54 per share year-to-date, including a cash dividend of $0.25 per share for Q1 2024, with a subsequent increase to $0.29 per share for Q2 2024 [13][20] - Total outstanding borrowings were $19.2 million with an interest rate of approximately 8.8% at quarter end [32] Q&A Session Summary Question: What is the outlook for future dividends? - Management indicated that the strategic focus on income-generating investments is expected to support an increase in dividends over time [34] Question: How has the portfolio composition changed? - The portfolio now consists of 70% debt investments, reflecting a strategic shift from previous years [25] Question: What were the key drivers of investment income growth? - The increase in investment income was primarily driven by a significant rise in interest income [17]

Investment Income and Portfolio Performance - Total investment income increased by 12% to $2.1 million for Q1 2024, driven by a 40% rise in interest from portfolio companies [4]. - Net investment income grew 17% to $840,000, or $0.33 per share, compared to $715,000, or $0.28 per share, in Q1 2023 [6]. - Total investment income for the first quarter of 2024 increased by 12% to $2,067,219 compared to $1,851,498 in the same period of 2023 [24]. - Net investment income for the first quarter of 2024 was $839,585, up from $714,916 in the first quarter of 2023 [25]. - The annualized weighted average yield of debt investments was 13.7% at March 31, 2024, slightly up from 13.6% at the end of 2023 [7]. - The investment portfolio consisted of 70% interest-yielding debt instruments at quarter-end, up from 64% at the end of 2023, enhancing portfolio yield and net interest income [4]. Asset and Dividend Information - The net asset value per share (NAV) was $23.85 at March 31, 2024, reflecting a 1% increase from year-end 2023 [4]. - Regular quarterly dividend increased by 16% to $0.29 per share for Q2 2024, up from $0.25 per share [14]. - Net assets at the end of the first quarter of 2024 were $61,569,339, an increase from $59,375,393 at the end of the first quarter of 2023 [25]. - The company declared a dividend of $645,255 in the first quarter of 2024, up from $516,204 in the same quarter of 2023 [25]. Investment Activities - New and follow-on investments totaled $10.8 million during the first quarter, including a $5.5 million investment in Mattison Avenue Holdings [4]. - The company realized a gain of $3.5 million from the sale of ACV Auctions stock, with the shares sold at an average price of $18.02 each [12]. - Net realized gain on sales and dispositions of investments reached $3,450,092, significantly higher than $53,388 in the same quarter of the previous year [25]. Expenses and Financial Metrics - Total expenses for the first quarter of 2024 were $1,226,856, compared to $1,047,845 in the first quarter of 2023 [28]. - Adjusted total expenses, excluding capital gains incentive fees, were $1,114,556 for the first quarter of 2024, compared to $756,845 in the same period of 2023 [28]. - Net increase in net assets from operations was $1,399,381 for the first quarter of 2024, down from $2,170,277 in the same quarter of 2023 [25]. - Basic and diluted net increase in net assets from operations per share decreased to $0.54 from $0.84 year-over-year [23]. - Outstanding borrowings on the senior secured revolving credit facility were $19.2 million, with an interest rate of 8.8% at quarter-end [9]. - Adjusted net investment income per share for the first quarter of 2024 was $0.37, compared to $0.39 in the same period of 2023 [30].