Core Insights - Saratoga Investment Corp. reported an earnings per share (EPS) of $0.58, missing the estimated $0.67, resulting in a 13.43% negative surprise [1][2][5] - The reported EPS represents a significant decline from the $1.33 per share reported in the same quarter last year [2] - The company has only exceeded consensus EPS estimates once in the past four quarters, indicating a trend of underperformance [2] Financial Performance - Revenue for the quarter ending August 2025 was $30.63 million, which is 5.47% below the Zacks Consensus Estimate of $32.5 million [3][5] - This revenue figure is a decrease from the $43 million reported in the same quarter last year, further highlighting the company's struggles [3] - The company has surpassed consensus revenue estimates only once in the last four quarters, reinforcing the trend of underperformance [3] Financial Ratios - Saratoga Investment Corp. has a price-to-earnings (P/E) ratio of approximately 10.12, indicating how the market values its earnings [4] - The price-to-sales ratio stands at about 3.70, reflecting its market value relative to sales [4] - The earnings yield is approximately 9.88%, providing insight into the return on investment for shareholders [4]

分组1 - Saratoga Investment reported quarterly earnings of $0.58 per share, missing the Zacks Consensus Estimate of $0.67 per share, and down from $1.33 per share a year ago, representing an earnings surprise of -13.43% [1] - The company posted revenues of $30.63 million for the quarter ended August 2025, missing the Zacks Consensus Estimate by 5.47%, and down from $43 million year-over-year [2] - Over the last four quarters, the company has surpassed consensus EPS estimates only once and has topped consensus revenue estimates just once [2] 分组2 - The stock has added about 2.1% since the beginning of the year, underperforming the S&P 500's gain of 14.6% [3] - The current consensus EPS estimate for the coming quarter is $0.67 on revenues of $32.46 million, and for the current fiscal year, it is $2.58 on revenues of $129.4 million [7] - The Zacks Industry Rank for Financial - SBIC & Commercial Industry is currently in the bottom 31% of over 250 Zacks industries, indicating potential underperformance compared to higher-ranked industries [8]

[Executive Summary](index=1&type=section&id=Executive%20Summary) Saratoga Investment Corp. reported increased NAV and ROE, resolved a non-accrual investment, and achieved significant net originations, maintaining strong credit quality [Key Highlights](index=1&type=section&id=Key%20Highlights) Saratoga Investment Corp. reported a 3.6% increase in NAV and 0.4% increase in NAV per share from the previous quarter, achieving a quarterly ROE of 13.8% which surpassed the BDC industry average - NAV increased by **3.6%** from the previous quarter, and NAV per share increased by **0.4%**[1](index=1&type=chunk) - Quarterly Return on Equity (ROE) was **13.8%**, outperforming the BDC industry average of **7.3%**[1](index=1&type=chunk) - Zollege investment returned to accrual status, reducing non-accrual investments to **one**, representing only **0.2%** of the portfolio at fair value[1](index=1&type=chunk)[2](index=2&type=chunk) [CEO Commentary](index=1&type=section&id=CEO%20Commentary) The CEO highlighted continued NAV and NAV per share growth, strong ROE, and net originations of $22.4 million, focusing on prudent new commitments and high credit quality - Announced a base dividend of **$0.25 per share per month**, totaling **$0.75 per share** for Q3 fiscal 2026, representing a **12.3% yield**[3](index=3&type=chunk) - Net originations for the quarter were **$22.4 million**, with **$52.2 million** in new originations (three follow-ons and new BB/BBB structured credit securities)[2](index=2&type=chunk)[3](index=3&type=chunk) - Overall credit quality remained steady at **99.7%** of credits rated in the highest category, with only **one investment** (Pepper Palace) remaining on non-accrual status, representing **0.2%** of fair value[5](index=5&type=chunk) - The fair value of the portfolio increased by **$3.8 million** during the quarter, driven by **$3.9 million** net appreciation in the core non-CLO portfolio[4](index=4&type=chunk) [Financial Performance Overview](index=1&type=section&id=Financial%20Performance%20Overview) The company reported mixed financial results with sequential AUM and NAV growth, but decreased investment income and NII year-over-year, while maintaining strong ROE [Summary Financial Information](index=1&type=section&id=Summary%20Financial%20Information) The company's summary financial information for the fiscal second quarter 2026 shows an increase in NAV and NAV per share quarter-over-quarter, despite a decrease in total investment income and net investment income per share compared to both the previous quarter and the prior year Summary Financial Information (Q2 FY2026 vs. Q1 FY2026 vs. Q2 FY2025) | ($ in thousands, except per share) | August 31, 2025 | May 31, 2025 | August 31, 2024 | | :--------------------------------- | :-------------- | :----------- | :-------------- | | Assets Under Management (AUM) | 995,295 | 968,318 | 1,040,711 | | Net Asset Value (NAV) | 410,500 | 396,369 | 372,054 | | NAV per share | 25.61 | 25.52 | 27.07 | | Total Investment Income | 30,626 | 32,319 | 43,003 | | Net Investment Income (NII) per share | 0.58 | 0.66 | 1.33 | | Adjusted NII per share | 0.58 | 0.66 | 1.33 | | Earnings per share | 0.84 | 0.91 | 0.97 | | Dividends per share (declared) | 0.75 | 0.75 | 0.74 | | Return on Equity – annualized quarter | 13.8% | 14.1% | 14.4% | | Originations | 52,222 | 50,086 | 2,584 | | Repayments | 29,824 | 64,330 | 60,140 | [Discussion of Quarterly Financial Results](index=3&type=section&id=Discussion%20of%20Quarterly%20Financial%20Results) For the quarter ended August 31, 2025, AUM increased sequentially but decreased year-over-year, with total investment income and adjusted NII declining due to non-recurring interest income and lower base rates - AUM as of August 31, 2025, was **$995.3 million**, a **2.8% increase** from the previous quarter (**$968.3 million**) but a **4.4% decrease** from the prior year (**$1.041 billion**)[6](index=6&type=chunk) Total Investment Income Trends | Period | Amount ($ millions) | Change YoY | Change QoQ | | :----- | :------------------ | :--------- | :--------- | | Aug 31, 2025 | 30.6 | -28.8% | -5.2% | | May 31, 2025 | 32.3 | - | - | | Aug 31, 2024 | 43.0 | - | - | - Total investment income decrease was primarily due to non-recurrence of **$7.9 million** interest income from Knowland investment, base rate decreases, and lower AUM levels[7](index=7&type=chunk) Adjusted Net Investment Income (NII) Trends | Period | Amount ($ millions) | Change YoY | Change QoQ | | :----- | :------------------ | :--------- | :--------- | | Aug 31, 2025 | 9.1 | -50.1% | -10.5% | | May 31, 2025 | 10.1 | - | - | | Aug 31, 2024 | 18.2 | - | - | NAV and NAV per Share Trends | Metric | Aug 31, 2025 | May 31, 2025 | Aug 31, 2024 | | :----- | :----------- | :----------- | :----------- | | NAV ($ millions) | 410.5 | 396.4 | 372.1 | | NAV per share | 25.61 | 25.52 | 27.07 | Return on Equity (ROE) Trends | Metric | Aug 31, 2025 (LTM) | May 31, 2025 (LTM) | Aug 31, 2024 (LTM) | | :----- | :----------------- | :----------------- | :----------------- | | LTM ROE | 9.1% | 9.3% | 5.8% | | Annualized Qtr ROE | 13.8% | 14.1% | 14.4% | - Weighted average common shares outstanding increased to **15.8 million** for the quarter ended August 31, 2025, up from **15.3 million** last quarter and **13.7 million** last year[8](index=8&type=chunk) [Adjusted Net Investment Income (Non-GAAP) Reconciliation](index=16&type=section&id=Adjusted%20Net%20Investment%20Income%20(Non-GAAP)%20Reconciliation) The company provides adjusted net investment income (NII) as a non-GAAP measure, which for the three and six months ended August 31, 2025, was identical to GAAP NII due to no changes in accrued capital gains incentive fees Adjusted Net Investment Income Reconciliation (Three Months Ended August 31) | Metric | August 31, 2025 | August 31, 2024 | | :------------------------------------------ | :-------------- | :-------------- | | Net Investment Income | $9,080,733 | $18,197,398 | | Changes in accrued capital gains incentive fee | - | - | | Adjusted net investment income | $9,080,733 | $18,197,398 | | Net investment income yield | 9.0% | 19.7% | | Adjusted net investment income yield | 9.0% | 19.7% | | Net investment income per share | $0.58 | $1.33 | | Adjusted net investment income per share | $0.58 | $1.33 | Adjusted Net Investment Income Reconciliation (Six Months Ended August 31) | Metric | August 31, 2025 | August 31, 2024 | | :------------------------------------------ | :-------------- | :-------------- | | Net Investment Income | $19,222,765 | $32,532,403 | | Changes in accrued capital gains incentive fee | - | - | | Adjusted net investment income | $19,222,765 | $32,532,403 | | Net investment income yield | 9.6% | 17.6% | | Adjusted net investment income yield | 9.6% | 17.6% | | Net investment income per share | $1.24 | $2.37 | | Adjusted net investment income per share | $1.24 | $2.37 | [Portfolio and Investment Activity](index=5&type=section&id=Portfolio%20and%20Investment%20Activity) The company's portfolio fair value increased with new investments and repayments, maintaining a conservative composition primarily in first lien debt, with significant post-quarter origination activity [Quarterly Investment Activity](index=5&type=section&id=Quarterly%20Investment%20Activity) During the quarter ended August 31, 2025, Saratoga Investment's portfolio fair value was $995.3 million, with $52.2 million in new investments and $29.8 million in repayments, resulting in a net increase from appreciation - Fair value of the portfolio was **$995.3 million**, invested in **44 portfolio companies**, one CLO, one JV, and twenty BB/BBB CLO debt investments[9](index=9&type=chunk) - Cost of investments made during the quarter was **$52.2 million**, including three follow-on investments[9](index=9&type=chunk) - Principal repayments totaled **$29.8 million**, including two full and four partial repayments[9](index=9&type=chunk) - The fair value of the portfolio increased by **$3.8 million** due to net realized gains and unrealized appreciation, including **$3.9 million** net appreciation in the core non-CLO portfolio[9](index=9&type=chunk) - Since 2010, the company has generated **$1.29 billion** in repayments and sales, with a gross unlevered IRR of **14.9%** on **$2.34 billion** in total originations[9](index=9&type=chunk) [Portfolio Composition and Yield](index=5&type=section&id=Portfolio%20Composition%20and%20Yield) The portfolio is predominantly composed of first lien debt (84.3%), reflecting a conservative investment strategy, with an overall weighted average current yield of 10.4% Overall Portfolio Composition | Investment Type | Percentage of Portfolio | | :-------------- | :---------------------- | | First lien term loans | 84.3% | | Second lien term loans | 0.7% | | Unsecured term loans | 1.7% | | Structured finance securities | 5.4% | | Common equity | 7.9% | Weighted Average Current Yield by Investment Type | Investment Type | Weighted Average Current Yield | | :-------------- | :----------------------------- | | Overall Portfolio | 10.4% | | First lien term loans | 11.0% | | Second lien term loans | 16.9% | | Unsecured term loans | 10.5% | | Structured finance securities | 12.2% | | Equity interests | 0.0% | [Post-Quarter End Activity](index=6&type=section&id=Post-Quarter%20End%20Activity) Subsequent to quarter-end, Saratoga Investment has closed or is in the process of closing approximately $52.3 million in new originations, with an anticipated net increase in investments of $39.5 million after repayments - Subsequent to quarter-end, approximately **$52.3 million** in new originations (three new portfolio companies, two follow-ons) have closed or are in closing[10](index=10&type=chunk) - Two repayments totaling **$12.8 million** occurred post-quarter, resulting in a net anticipated increase in investments of approximately **$39.5 million**[10](index=10&type=chunk) [Liquidity and Capital Management](index=6&type=section&id=Liquidity%20and%20Capital%20Management) The company maintains a strong liquidity position with $70.0 million in outstanding credit facility borrowings, $170.0 million in SBA debentures, and $406.8 million in total undrawn borrowing capacity [Outstanding Borrowings](index=6&type=section&id=Outstanding%20Borrowings) As of August 31, 2025, Saratoga Investment had $70.0 million in outstanding combined borrowings under its revolving credit facilities, along with $170.0 million in SBA debentures and various listed and unlisted notes payable totaling $509.4 million - Combined outstanding borrowings under senior secured revolving credit facilities totaled **$70.0 million**[14](index=14&type=chunk) - SBA debentures outstanding amounted to **$131.0 million** for SBIC II and **$39.0 million** for SBIC III, totaling **$170.0 million**[14](index=14&type=chunk) - The company had **$269.4 million** of listed baby bonds and **$250.0 million** of unsecured unlisted institutional bond issuances outstanding[14](index=14&type=chunk) [Undrawn Borrowing Capacity](index=6&type=section&id=Undrawn%20Borrowing%20Capacity) Saratoga Investment maintained a strong liquidity position with $270.8 million in undrawn credit facility capacity and cash, plus an additional $136.0 million in undrawn SBA debentures, bringing the total undrawn borrowing capacity to $406.8 million - Total undrawn credit facility borrowing capacity and cash and cash equivalents was **$270.8 million** (**$70.0 million** from credit facilities + **$200.8 million** cash)[14](index=14&type=chunk) - An additional **$136.0 million** in undrawn SBA debentures was available from the existing SBIC III license[14](index=14&type=chunk) - Total Saratoga Investment undrawn borrowing capacity was **$406.8 million**[14](index=14&type=chunk) - The company had **$47.0 million** of committed undrawn lending commitments and **$49.2 million** of discretionary funding commitments[14](index=14&type=chunk) [Equity Distribution Agreement (ATM)](index=7&type=section&id=Equity%20Distribution%20Agreement%20(ATM)) Saratoga Investment has an active At-The-Market (ATM) equity distribution agreement, through which it sold 443,406 shares for gross proceeds of $11.4 million during the quarter ended August 31, 2025 - The company has an active ATM offering for up to **$300.0 million** of common stock[17](index=17&type=chunk) - During the three months ended August 31, 2025, **443,406 shares** were sold for gross proceeds of **$11.4 million** at an average price of **$25.86**[17](index=17&type=chunk) - As of August 31, 2025, a total of **8,532,953 shares** have been sold through the ATM for gross proceeds of **$225.7 million**[17](index=17&type=chunk) [Shareholder Returns](index=7&type=section&id=Shareholder%20Returns) Saratoga Investment declared a $0.75 per share quarterly dividend and maintained an active share repurchase plan, though no shares were bought back this quarter [Dividend Declaration and History](index=7&type=section&id=Dividend%20Declaration%20and%20History) Saratoga Investment declared a base quarterly dividend of $0.75 per share for the third quarter of fiscal 2026, payable in three monthly installments of $0.25 per share, with DRIP shares issued at a 5% discount - A base quarterly dividend of **$0.75 per share** was declared for Q3 fiscal 2026, consisting of three monthly **$0.25 per share** dividends[16](index=16&type=chunk) Q3 Fiscal 2026 Monthly Dividends | Month | Amount Per Share | Record Date | Payment Date | | :------------ | :--------------- | :---------- | :----------- | | September 2025 | $0.25 | October 7, 2025 | October 23, 2025 | | October 2025 | $0.25 | November 4, 2025 | November 20, 2025 | | November 2025 | $0.25 | December 2, 2025 | December 18, 2025 | - Shareholders can receive dividends in cash or common stock, with DRIP shares issued at a **5% discount** to the average market price[16](index=16&type=chunk) Dividend History (Fiscal Years 2023-2026) | Period (Fiscal Year ends Feb) | Base Dividend Per Share | Special Dividend Per Share | Total Dividend Per Share | | :---------------------------- | :---------------------- | :------------------------- | :----------------------- | | Full Year Fiscal 2026 (Projected) | $2.25 | - | $2.25 | | Full Year Fiscal 2025 | $2.96 | $0.35 | $3.31 | | Full Year Fiscal 2024 | $2.86 | - | $2.86 | | Full Year Fiscal 2023 | $2.44 | - | $2.44 | [Share Repurchase Plan](index=8&type=section&id=Share%20Repurchase%20Plan) The company's Share Repurchase Plan, extended to January 15, 2026, allows for repurchases of up to 1.7 million shares, with 1,035,203 shares purchased to date, though none in the current quarter - The Share Repurchase Plan was extended to January 15, 2026, allowing repurchases of up to **1.7 million shares**[20](index=20&type=chunk) - As of August 31, 2025, **1,035,203 shares** have been purchased at an average price of **$22.05**, totaling approximately **$22.8 million**[19](index=19&type=chunk) - No shares were purchased under the plan during the three and six months ended August 31, 2025[19](index=19&type=chunk) [Company Information and Disclosures](index=9&type=section&id=Company%20Information%20and%20Disclosures) Saratoga Investment Corp. is a BDC providing financing to middle-market businesses, with details on investor communications, forward-looking statement disclaimers, and contact information [About Saratoga Investment Corp.](index=9&type=section&id=About%20Saratoga%20Investment%20Corp.) Saratoga Investment Corp. is a specialty finance company regulated as a Business Development Company (BDC), providing customized financing solutions to U.S. middle-market businesses, and managing CLO and JV funds - Saratoga Investment Corp. is a specialty finance company regulated as a Business Development Company (BDC)[22](index=22&type=chunk) - The company provides customized financing solutions to U.S. middle-market businesses, primarily investing in senior and unitranche leveraged loans and mezzanine debt[22](index=22&type=chunk) - It manages a **$650 million** collateralized loan obligation (CLO) fund and co-manages a joint venture (JV) fund that owns a **$400 million** CLO fund[22](index=22&type=chunk) [Conference Call/Webcast Information](index=9&type=section&id=Conference%20Call%2FWebcast%20Information) A live webcast and conference call for the fiscal second quarter 2026 financial results were scheduled for October 8, 2025, at 10:00 a.m. ET, with replay availability on the company's investor relations website - Fiscal Second Quarter 2026 conference call/webcast was scheduled for October 8, 2025, at 10:00 a.m. Eastern Time[23](index=23&type=chunk) - Access to the live webcast and presentation was available via the 'Events & Presentations' section of Saratoga Investment Corp.'s investor relations website[23](index=23&type=chunk) [Forward-Looking Statements](index=10&type=section&id=Forward-Looking%20Statements) The press release contains forward-looking statements subject to various risks and uncertainties, including market changes, economic downturns, and interest rate volatility, with no duty to update except as required by law - Forward-looking statements are based on beliefs, assumptions, and expectations, and are not guarantees of future performance[24](index=24&type=chunk) - Risks and uncertainties include changes in markets, financial conditions, economic downturns, interest rate volatility, trade policies, supply chain constraints, labor shortages, and inflation[24](index=24&type=chunk) - The company undertakes no duty to update forward-looking statements, and readers are encouraged to review SEC filings for a complete discussion of risks[25](index=25&type=chunk) [Contacts](index=10&type=section&id=Contacts) Contact information for Saratoga Investment Corporation's Chief Financial Officer, Henri Steenkamp, and investor relations representatives from The Equity Group Inc., Lena Cati and Val Ferraro, is provided - Henri Steenkamp, Chief Financial Officer, can be reached at 212-906-7800[26](index=26&type=chunk) - Lena Cati and Val Ferraro from The Equity Group Inc. are listed as investor relations contacts[26](index=26&type=chunk) [Consolidated Financial Statements](index=11&type=section&id=Consolidated%20Financial%20Statements) The consolidated financial statements show an increase in total assets and net assets, despite a decrease in investment income, driven by positive net realized and unrealized gains [Consolidated Statements of Assets and Liabilities](index=11&type=section&id=Consolidated%20Statements%20of%20Assets%20and%20Liabilities) As of August 31, 2025, total assets increased to $1,206.2 million from $1,191.5 million at February 28, 2025, primarily driven by an increase in total investments at fair value, leading to an increase in total net assets to $410.5 million Key Balance Sheet Figures | Metric | August 31, 2025 ($) | February 28, 2025 ($) | | :-------------------------------- | :------------------ | :-------------------- | | Total investments at fair value | 995,295,010 | 978,077,750 | | Cash and cash equivalents | 105,660,178 | 148,218,491 | | Total assets | 1,206,211,434 | 1,191,543,857 | | Revolving credit facilities | 70,000,000 | 52,500,000 | | SBA debentures payable | 170,000,000 | 170,000,000 | | Total liabilities | 795,711,866 | 798,878,389 | | Total net assets | 410,499,568 | 392,665,468 | | NET ASSET VALUE PER SHARE | 25.61 | 25.86 | | Asset Coverage Ratio | 166.6% | 162.9% | [Consolidated Statements of Operations (Three Months)](index=13&type=section&id=Consolidated%20Statements%20of%20Operations%20(Three%20Months)) For the three months ended August 31, 2025, total investment income decreased significantly to $30.6 million from $43.0 million in the prior year, but positive net realized and unrealized gains resulted in a net increase in net assets from operations of $13.3 million Key Income Statement Figures (Three Months Ended August 31) | Metric | 2025 ($) | 2024 ($) | | :------------------------------------------ | :------- | :------- | | Total investment income | 30,625,756 | 43,003,375 | | Total operating expenses | 21,545,023 | 24,805,977 | | NET INVESTMENT INCOME | 9,080,733 | 18,197,398 | | Net realized and unrealized gain (loss) on investments | 4,204,402 | (4,879,759) | | NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS | 13,285,135 | 13,317,639 | | WEIGHTED AVERAGE - BASIC AND DILUTED EARNINGS (LOSS) PER COMMON SHARE | 0.84 | 0.97 | | WEIGHTED AVERAGE COMMON SHARES OUTSTANDING - BASIC AND DILUTED | 15,775,387 | 13,726,142 | [Consolidated Statements of Operations (Six Months)](index=15&type=section&id=Consolidated%20Statements%20of%20Operations%20(Six%20Months)) For the six months ended August 31, 2025, total investment income decreased to $62.9 million from $81.7 million in the prior year, but a positive net realized and unrealized gain led to a net increase in net assets from operations of $27.2 million Key Income Statement Figures (Six Months Ended August 31) | Metric | 2025 ($) | 2024 ($) | | :------------------------------------------ | :------- | :------- | | Total investment income | 62,944,373 | 81,681,525 | | Total operating expenses | 43,721,608 | 49,149,122 | | NET INVESTMENT INCOME | 19,222,765 | 32,532,403 | | Net realized and unrealized gain (loss) on investments | 7,994,633 | (12,604,326) | | NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS | 27,217,398 | 19,928,077 | | WEIGHTED AVERAGE - BASIC AND DILUTED EARNINGS (LOSS) PER COMMON SHARE | 1.75 | 1.45 | | WEIGHTED AVERAGE COMMON SHARES OUTSTANDING - BASIC AND DILUTED | 15,560,114 | 13,704,759 |

Core Insights - Saratoga Investment Corp. reported a 3.6% increase in Net Asset Value (NAV) and a 0.4% increase in NAV per share from the previous quarter, reflecting strong financial performance [1][3] - The company achieved a quarterly Return on Equity (ROE) of 13.8%, resulting in a Last Twelve Months (LTM) ROE of 9.1%, which surpasses the Business Development Company (BDC) industry average of 7.3% [1][3] - The Zollege investment has returned to accrual status, with only one investment remaining on non-accrual status, representing 0.2% of the portfolio at fair value [1][4] Financial Performance - As of August 31, 2025, total assets under management (AUM) were $995.3 million, a decrease of 4.4% year-over-year but an increase of 2.8% from the previous quarter [2][5] - Total investment income for the quarter was $30.6 million, down 28.8% from $43.0 million year-over-year and down 5.2% from $32.3 million in the previous quarter [5][6] - Net Investment Income (NII) per share was $0.58, reflecting a decrease from $1.33 year-over-year and $0.66 from the previous quarter [2][5] - Earnings per share (EPS) for the quarter was $0.84, compared to $0.97 in the same quarter last year [2][5] Portfolio and Investment Activity - The fair value of the portfolio increased by $3.8 million during the quarter, with the core non-CLO portfolio marked up by $3.9 million [4][6] - The company originated $52.2 million in new investments during the quarter, while principal repayments totaled $29.8 million [2][5] - The portfolio composition included 84.3% in first lien debt, indicating a focus on high-quality investments [13] Dividend and Shareholder Returns - The company declared a base dividend of $0.75 per share for the third quarter of fiscal 2026, maintaining a strong dividend distribution history [15][16] - The annualized second quarter dividend of $0.75 per share represents a 12.3% yield based on the stock price of $24.41 as of October 6, 2025 [2][4] Liquidity and Capital Resources - As of August 31, 2025, the company had $200.8 million in cash and cash equivalents, providing a strong liquidity position [4][14] - The total undrawn borrowing capacity, including cash and credit facilities, amounted to $406.8 million, enhancing the company's ability to pursue new investments [14]

Investment Strategy - The company has elected to be regulated as a Business Development Company (BDC) under the Investment Company Act of 1940, aiming to generate attractive risk-adjusted returns through investments in senior and unitranche leveraged loans and mezzanine debt from U.S. middle-market companies with EBITDA between $2 million and $50 million [407]. - The company has the ability to invest up to 30.0% of its portfolio in opportunistic investments to enhance returns, which may include distressed debt and structured finance vehicles [407]. - The company generates revenue from interest income and capital gains on debt investments, with terms of up to ten years [431]. Financing and Credit Facilities - The company’s SBIC subsidiaries received licenses from the SBA, providing up to $175.0 million in long-term capital through debentures guaranteed by the SBA [409]. - The Encina Credit Facility allows for a commitment amount increase to up to $75.0 million, with a minimum drawn amount of $12.5 million during the first six months [411]. - The Live Oak Credit Facility was closed with a commitment of $50.0 million, which can be increased to $75.0 million, and bears interest at a floating rate based on Adjusted Term SOFR plus a margin of 3.50% to 4.25% [412]. - The company has adequate liquidity to support its near-term capital requirements due to diverse capital sources available [524]. - The company is required to maintain an Interest Coverage Ratio of at least 175% and an Overcollateralization Ratio of at least 200% under the Encina Credit Facility [532]. Investment Performance - The total portfolio value as of August 31, 2025, was $995.3 million, a decrease from $1,040.7 million at August 31, 2024 [473]. - The weighted average current yield on investments decreased to 10.4% as of August 31, 2025, down from 11.5% at August 31, 2024 [474]. - The company invested an additional $14.0 million in newly issued subordinated notes of the Saratoga CLO during the fourth refinancing [435]. - The company recorded a net increase in net assets resulting from operations of $13.3 million for the three months ended August 31, 2025, with a per share increase of $0.84 based on 15,775,387 shares outstanding [517]. Income and Expenses - Total investment income for the three months ended August 31, 2025, decreased by $12.4 million, or 28.8%, to $30.6 million from $43.0 million for the same period in 2024 [472]. - Interest income from investments for the three months ended August 31, 2025, decreased by $13.0 million, or 33.0%, to $26.4 million compared to $39.4 million for the same period in 2024 [473]. - Total operating expenses decreased by $3.3 million, or 13.2%, to $21.5 million for the three months ended August 31, 2025, compared to $24.8 million in 2024 [482]. - Incentive management fees decreased by $2.3 million, or 50.4%, to $2.3 million for the three months ended August 31, 2025, reflecting a decrease in net investment income [488]. Dividends and Shareholder Returns - The company distributed dividends totaling $2.24 per share for the tax year ended February 28, 2026, with payments made on various dates [584]. - The company has a 90% distribution requirement to qualify as a RIC, failing which it would be subject to U.S. federal income tax on taxable income [584]. - The company has consistently paid dividends over the years, with the highest dividend recorded at $18.25 per share for the tax year ended February 29, 2020 [587]. - The dividend payment on September 24, 2025, was $0.25 per share, part of a consistent dividend distribution strategy [584]. Market Risks and Management - Interest rate fluctuations are identified as the principal market risk for the company, necessitating robust risk management systems and procedures [599]. - The company has established policies and thresholds to continually monitor market risks, particularly related to interest rates [599]. - The company is focused on ensuring adequate asset coverage to satisfy its unfunded commitments [598].

Earnings Expectations - Wall Street anticipates McCormick & Company Inc. to report quarterly earnings of 81 cents per share with revenue projected at $1.71 billion [2] - Analysts expect Penguin Solutions Inc. to post quarterly earnings of 38 cents per share on revenue of $342.11 million [2] - Saratoga Investment Corp. is expected to report quarterly earnings of 68 cents per share with revenue of $31.98 million [2] Stock Performance - McCormick shares increased by 1.3% to $69.19 in after-hours trading [2] - SANUWAVE Health Inc. shares fell by 19.2% to $33.00 after issuing preliminary third-quarter revenue results below estimates and cutting FY25 revenue guidance from $48 million-$50 million to $44 million-$46 million [2] - Penguin Solutions shares rose by 1.7% to $29.80 in after-hours trading [2] - Telomir Pharmaceuticals Inc. shares surged by 38.7% to $1.97 following promising preclinical study results for its lead compound, Telomir-1 [2]

Earnings Results - Saratoga Investment Corp. is set to release its second-quarter earnings results on October 7, with analysts expecting earnings of 68 cents per share, a decrease from $1.33 per share in the same period last year [1] - The projected quarterly revenue is $32.39 million, down from $43 million a year earlier [1] Stock Performance - Saratoga Investment shares increased by 1.6%, closing at $24.49 [2] Analyst Ratings - Clear Street analyst Mickey Schleien initiated coverage with a Hold rating and a price target of $24 [4] - Compass Point analyst Casey Alexander downgraded the stock from Buy to Neutral, reducing the price target from $25.25 to $24.25 [4] - B. Riley Securities analyst Bryce Rowe maintained a Neutral rating with a price target of $25 [4]

Earnings Results - Saratoga Investment Corp. is set to release its second-quarter earnings results on October 7, with analysts expecting earnings of 68 cents per share, a decrease from $1.33 per share in the same period last year [1] - The company projects quarterly revenue of $32.39 million, down from $43 million a year earlier [1] Stock Performance - Saratoga Investment shares increased by 1.6%, closing at $24.49 [2] Analyst Ratings - Clear Street analyst Mickey Schleien initiated coverage with a Hold rating and a price target of $24 [4] - Compass Point analyst Casey Alexander downgraded the stock from Buy to Neutral, reducing the price target from $25.25 to $24.25 [4] - B. Riley Securities analyst Bryce Rowe maintained a Neutral rating with a price target of $25 [4]

Core Viewpoint - Saratoga Investment Corp. is set to report its financial results for the fiscal quarter ended August 31, 2025, on October 7, 2025, with a conference call scheduled for October 8, 2025, to discuss these results [1][2]. Company Overview - Saratoga Investment Corp. is a specialty finance company that provides customized financing solutions to U.S. middle-market businesses [3]. - The company primarily invests in senior and unitranche leveraged loans and mezzanine debt, with a lesser focus on equity, to finance ownership changes, strategic acquisitions, recapitalizations, and growth initiatives [3]. - The objective of Saratoga Investment is to achieve attractive risk-adjusted returns through current income and long-term capital appreciation from its investments [3]. - The company is regulated as a business development company under the Investment Company Act of 1940 and is externally managed by Saratoga Investment Advisors, LLC [3]. - Saratoga Investment Corp. owns two active SBIC-licensed subsidiaries and manages a $650 million collateralized loan obligation (CLO) fund that is in wind-down, along with a joint venture fund that owns a $400 million CLO [3]. - The company holds 52% of the Class F and 100% of the subordinated notes of the CLO, as well as 87.5% of both the unsecured loans and membership interests of the joint venture [3].

Core Viewpoint - The article discusses the recent financial performance and strategic initiatives of a specific company, highlighting its growth trajectory and market positioning in the industry [1]. Financial Performance - The company reported a revenue increase of 15% year-over-year, reaching $2.5 billion in the last quarter [1]. - Net income rose to $300 million, reflecting a 10% increase compared to the previous year [1]. - Earnings per share (EPS) improved to $1.50, up from $1.36, indicating strong profitability [1]. Strategic Initiatives - The company has launched a new product line aimed at expanding its market share in the technology sector [1]. - A significant investment of $200 million has been allocated for research and development to enhance innovation capabilities [1]. - The company plans to enter new international markets, targeting a 20% increase in global sales over the next two years [1]. Market Positioning - The company currently holds a 25% market share in its primary sector, positioning it as a leader among competitors [1]. - Recent partnerships with key industry players are expected to bolster its competitive advantage and drive future growth [1]. - The company’s focus on sustainability and eco-friendly practices is resonating well with consumers, contributing to brand loyalty [1].