Investment Income and Assets - Total investment income for Q2 2024 was $3.1 million, with net investment income of $1.5 million, or $0.25 per share[2]. - Total investment income for the three months ended June 30, 2024, was $3,081,333, an increase of 6.5% compared to $2,893,699 for the same period in 2023[14]. - Net investment income for the three months ended June 30, 2024, was $1,525,633, compared to $1,899,412 for the same period in 2023, reflecting a decrease of 19.7%[14]. - Total assets increased to $90,076,727 as of June 30, 2024, up from $88,576,271 at the end of 2023, representing a growth of 1.7%[13]. - As of June 30, 2024, total net assets were $84.3 million, down from $84.5 million as of March 31, 2024[5]. - Cash and cash equivalents increased to $34,003,851 as of June 30, 2024, compared to $32,611,635 at the end of 2023, a rise of 4.2%[13]. Dividends and Shareholder Returns - The company declared a cash dividend of $0.25 per share, payable on September 27, 2024, to stockholders of record on September 19, 2024[2][10]. - Net asset value (NAV) per share decreased from $13.60 on March 31, 2024, to $13.56 on June 30, 2024, primarily due to dividend payments[5]. - The net asset value per share decreased to $13.56 as of June 30, 2024, down from $13.77 at the end of 2023, a decline of 1.5%[13]. Expenses and Financial Performance - Total expenses for the three months ended June 30, 2024, were $1,555,700, an increase of 56.5% from $994,287 in the same period last year[14]. - The company reported a transaction expense of $533,019 related to the Loan Portfolio Acquisition for the three months ended June 30, 2024[14]. - The company incurred income-based incentive fees of $328,503 for the three months ended June 30, 2024, down from $442,673 in the same period last year, a decrease of 25.8%[14]. - The net increase in net assets resulting from operations for the three months ended June 30, 2024, was $1,292,861, compared to $1,211,404 for the same period in 2023, indicating a growth of 6.7%[14]. Portfolio and Strategic Initiatives - The investment portfolio had a fair value of $53.4 million, consisting of $44.3 million in secured loans, $8.3 million in secured notes, and $0.8 million in equity[6]. - The company added one portfolio company during Q2 2024 and made an additional investment on July 16, 2024[6]. - The company is well-positioned to take advantage of increased debt capital markets activity in the cannabis sector[3]. - The company has filed a registration statement for the Loan Portfolio Acquisition with the SEC, indicating ongoing strategic expansion efforts[3][11]. - The company recorded a net unrealized loss of $0.2 million during Q2 2024, mainly related to the fair valuation of debt investments[4].

Financial Performance - Total investment income for the second quarter ended June 30, 2024, was $3.1 million, compared to $2.9 million for the same period in 2023 [2][21] - Net investment income was $1.5 million, or $0.25 per share, down from $1.9 million, or $0.31 per share, in the prior year [5][22] - The company recorded a net unrealized loss of $0.2 million during the quarter, primarily related to the fair valuation of debt investments [6] Asset and NAV Details - The investment portfolio had a fair value of approximately $53.4 million, consisting of $44.3 million in secured loans, $8.3 million in secured notes, and $0.8 million in equity [8] - Net asset value (NAV) per share decreased from $13.60 on March 31, 2024, to $13.56 on June 30, 2024, primarily due to dividend payments [7][19] - Total net assets as of June 30, 2024, were $84.3 million, down from $84.5 million as of March 31, 2024 [7] Dividend Declaration - The company declared a cash dividend of $0.25 per share, payable on September 27, 2024, to stockholders of record on September 19, 2024 [10][2] Loan Portfolio Acquisition - The company entered into an agreement to purchase a loan portfolio from Chicago Atlantic Loan Portfolio, LLC, in exchange for newly issued shares of common stock [4] - The acquisition is subject to customary closing conditions and has been filed with the SEC [4] Market and Industry Commentary - The CEO noted uncertainty around federal cannabis regulatory reform but highlighted positive momentum at the state level, with larger cannabis operators performing well [3] - The company is well-positioned to take advantage of increased activity in debt capital markets, which is expected to continue [3]

Investment Income and Performance - Investment income for the three months ended June 30, 2024, was $3,081,333, compared to $2,893,699 for the same period in 2023, representing an increase of approximately 6.5%[7] - Total investment income for the six months ended June 30, 2024, was $5,841,580, up from $5,351,538 in the prior year, representing a growth of 9.1%[7] - Interest income for the three months ended June 30, 2024, was $2,582,583, compared to $2,601,710 for the same period in 2023, reflecting a slight decrease[24] - Interest income for the six months ended June 30, 2024, was approximately $5.5 million, compared to $5.2 million for the same period in 2023[84] - Net investment income for the three months ended June 30, 2024, was $1,525,633, down from $1,899,412 for the same period in 2023, reflecting a decrease of about 19.7%[7] - Net investment income for the six months ended June 30, 2024, was approximately $1.5 million, down from $1.9 million in the same period of 2023, reflecting a decrease of 21.1%[85] Expenses and Financial Position - Total expenses for the six months ended June 30, 2024, were $4,395,756, up from $2,081,403 for the same period in 2023, indicating an increase of approximately 111.5%[7] - Total operating expenses for the three months ended June 30, 2024, were $1,555,700, compared to $994,287 for the same period in 2023, indicating a significant increase of 56.4%[7] - The ratio of expenses to average net assets increased to 5.17% from 2.37% in the previous year[57] - The company reported a net increase in net assets from operations of $1,292,861 for the three months ended June 30, 2024, compared to $1,211,404 for the same period in 2023, representing an increase of 6.7%[51] - As of June 30, 2024, total net assets decreased to $84,258,073 from $90,044,213 as of June 30, 2023, a decrease of approximately 6.2%[8] Investment Strategy and Portfolio Composition - The company has a diversified investment portfolio with significant holdings in senior secured loans and notes across various sectors, including real estate services[12] - The company plans to acquire a loan portfolio from Chicago Atlantic Loan Portfolio, LLC, expected to close in mid-2024, which will involve issuing shares equivalent to the portfolio's net asset value[14] - The company expanded its investment strategy to include companies outside the cannabis and health sectors, effective April 22, 2024[14] - The company’s investment objective is to maximize risk-adjusted returns on equity through current income from debt investments and capital appreciation from equity investments[14] - As of June 30, 2024, the investment portfolio had a fair value of approximately $53.4 million, comprised of $44.3 million in first lien, senior secured loans and $8.3 million in senior secured notes[76] Cash Flow and Liquidity - Net cash provided by operating activities for the six months ended June 30, 2024, was $4,584,511, compared to a net cash used of $(2,229,660) for the same period in 2023[11] - Cash and cash equivalents at the end of the period increased to $34,003,851 from $32,895,660 year-over-year[11] - The company maintains adequate liquidity to fund its unfunded commitments through existing cash and cash equivalents[93] Shareholder Distributions - The company declared quarterly distributions of $0.25 per share on March 8, 2024, and May 9, 2024, totaling $1,553,736 and $1,553,738 respectively for the six months ended June 30, 2024[49] - The company must distribute at least 90% of its investment company taxable income to maintain its tax treatment as a RIC, which is crucial for avoiding corporate-level federal income taxes[88] Risk Management and Market Conditions - The company faces various risks including market risk, credit risk, and interest rate risk, which could impact financial performance[37] - The fair value of investments may fluctuate significantly due to the inherent uncertainty in determining fair value, especially for investments without readily available market quotations[39] - The company is actively monitoring the effects of interest rate changes on its investment income, with specific attention to interest rate floors for floating rate instruments[100] Future Outlook and Strategic Initiatives - The company anticipates future operating results and distribution projections to be influenced by interest and inflation rates, as well as the impact of the COVID-19 pandemic on its portfolio companies[4] - The company is currently reviewing approximately $560 million of potential investments in varying stages of underwriting[72] - The company plans to enter into a credit facility in the future, with leverage depending on market conditions and investment outlook[88]

Industry Overview - The cannabis industry grew to $31.6 billion last year and is expected to reach $35 billion this year, with nearly 50% growth projected over the next six years [4] - Optimism surrounding potential amendments to Section 280E could benefit cannabis companies, especially with more states likely to legalize cannabis [4] - Federal legalization of cannabis could lead to tax credits and deductions for companies in the industry, positively impacting their cash flows [4] Company Positioning - Silver Spike Investment Corp (SSIC) is the only publicly-traded Business Development Company (BDC) that directly lends to the cannabis industry, positioning it well for growth [4] - SSIC currently lends to Curaleaf, one of the largest publicly-traded cannabis companies, which is expected to become more profitable as the industry expands [4] - SSIC has a market cap of less than $100 million and a small portfolio valued at approximately $55 million, making it a speculative investment [11] Financial Performance - SSIC reported a net investment income of -$0.01 for Q1, a significant drop from $0.28 in the prior quarter and $0.22 a year ago [19] - Total investment income for Q1 was $2.8 million, slightly down from $2.9 million in Q4 but up 16% year-over-year from $2.5 million [19] - The company incurred a $2.1 million charge related to a recent acquisition, impacting its net investment income [20] Dividend Safety - Despite the negative net investment income, SSIC's dividend yield remains well-covered, with a coverage ratio of 132% when excluding the transaction expense [20] - SSIC's dividend of $0.25 was not covered during the latest quarter, but the company has no debt and $33.2 million in cash, allowing it to continue funding dividends if necessary [20] Acquisition Impact - SSIC is expected to close an acquisition with Chicago Atlantic Real Estate Finance, which will add 27 companies worth approximately $187 million to its portfolio [19] - This acquisition is anticipated to enhance SSIC's scale and liquidity while diversifying its portfolio, although it will dilute existing shareholders [19] Market Valuation - SSIC is currently trading at $12 per share, which is 5% above Wall Street's price target of $11.40, indicating it may be overvalued [22] - Despite the potential for further upside due to the growth of the cannabis industry, the stock may see a pullback in price [22]

Company Overview - Silver Spike Investment Corp. (SSIC) shares increased by 5.8% to close at $12.38, with notable trading volume compared to typical sessions, and a 3.5% gain over the past four weeks [1] - The company is expected to report quarterly earnings of $0.07 per share, reflecting a year-over-year decline of 77.4%, with revenues projected at $2.23 million, down 22.7% from the previous year [2] - The consensus EPS estimate for SSIC has remained unchanged over the last 30 days, indicating that stock price movements may not sustain without earnings estimate revisions [3] Industry Context - SSIC operates within the Zacks Financial - SBIC & Commercial Industry, where another company, TriplePoint Venture Growth (TPVG), saw a 0.8% increase to $8.82, but has returned -8.4% over the past month [4] - Anticipation of a Federal Reserve rate cut later this year is expected to increase demand for loans from SSIC's portfolio companies, contributing to the recent stock price increase [5] - Trends in earnings estimate revisions are strongly correlated with near-term stock price movements, highlighting the importance of monitoring these changes for investment decisions [6] Comparative Analysis - SSIC currently holds a Zacks Rank of 2 (Buy), while TPVG has a Zacks Rank of 5 (Strong Sell), with TPVG's consensus EPS estimate unchanged at $0.43, representing an 18.9% decline from the previous year [7]

Financial Data and Key Metrics Changes - Gross investment income for Q1 2024 was $2.8 million, an increase from $2.5 million in Q1 2023 [9] - Net investment income was negative $0.01 per share, with net asset value at $13.60 as of March 31, 2024 [11] - The company declared a quarterly cash dividend of $0.25 per share, payable on June 28, 2024 [11] Business Line Data and Key Metrics Changes - The company incurred transaction-related expenses of $2.1 million in the quarter due to the loan portfolio acquisition [14] - The investment income, excluding transaction expenses, was $2 million compared to $1.4 million last year [14] - The portfolio summary indicated over $54 million invested with an average yield to maturity of about 18% [15] Market Data and Key Metrics Changes - The company has an active pipeline of over $425 million, indicating strong origination efforts despite a cautious borrowing environment [13] - The competitive dynamic for the lending industry remains unchanged, with no expected significant change in yields or overall dynamics in the near term [25] Company Strategy and Development Direction - The company is focused on supporting good operators in the cannabis industry as they revisit their growth and expansion plans [26] - The anticipated rescheduling of cannabis is viewed positively, but the company does not expect immediate changes in capital supply dynamics [18][25] Management's Comments on Operating Environment and Future Outlook - Management expressed a mildly optimistic view regarding the rescheduling of cannabis, noting potential positive impacts on cash flows for portfolio companies [17][19] - The current dynamic of capital constraints in the industry is expected to remain largely unchanged despite the legislative developments [18][25] Other Important Information - The company filed a registration statement on Form N-14 with the SEC for the loan portfolio acquisition, expecting the transaction to close in mid-2024 [9][23] Q&A Session Summary Question: Progress on the transaction and regulatory review updates - Management indicated that the approval process is proceeding as anticipated, with comments from the SEC expected soon [23] Question: Implications of cannabis rescheduling - Management noted that the rescheduling would positively impact cash flows and credit metrics for portfolio companies, but does not expect a significant change in capital supply dynamics [24][25] Question: Demand side dynamics in light of 280E news - Management acknowledged that some operators may take a wait-and-see approach, but many will still seek capital for growth plans [32][34] Question: Clarification on transaction structure with Chicago Atlantic - Management confirmed that the transaction is completely separate from the REIT and involves a different holding company [36]

Financial Performance - Total investment income for Q1 2024 was $2.8 million, with total expenses of $2.9 million, resulting in a net investment loss of $(0.1) million or $(0.01) per share[5] - Total investment income for the three months ended March 31, 2024, was $2,760,247, a 12.3% increase from $2,457,839 in the same period of 2023[23] - Net investment loss for the three months ended March 31, 2024, was $(79,809), compared to a net investment income of $1,370,723 for the same period in 2023, indicating a significant decline[23] - Total expenses rose to $2,840,056 for the three months ended March 31, 2024, compared to $1,087,116 in the prior year, marking an increase of approximately 161.5%[23] - The net increase in net assets resulting from operations was $519,811 for the three months ended March 31, 2024, down from $2,357,080 in the same period of 2023[23] - The company reported a net change in unrealized appreciation from investments of $599,620 for the three months ended March 31, 2024, compared to $986,357 in the same period of 2023[23] Asset and Liability Overview - Total assets increased to $90,351,075 as of March 31, 2024, up from $88,576,271 on December 31, 2023, representing a growth of approximately 2.0%[21] - Total liabilities increased to $5,832,308 as of March 31, 2024, compared to $3,023,653 on December 31, 2023, indicating a rise of approximately 92.9%[21] - Cash and cash equivalents increased to $33,160,294 as of March 31, 2024, compared to $32,611,635 on December 31, 2023, reflecting a growth of approximately 1.7%[21] - As of March 31, 2024, the net asset value (NAV) per share decreased to $13.60 from $13.77 as of December 31, 2023, primarily due to dividend payments[7] Investment Activity - The investment portfolio had an aggregate fair value of $54.8 million, consisting of $46.6 million in secured loans and $8.2 million in secured notes[15] - There were no investments made during the quarter ended March 31, 2024, and no loans were on non-accrual status[15] - The Company entered into a definitive agreement to purchase a loan portfolio from Chicago Atlantic Loan Portfolio, LLC, in exchange for newly issued shares[4] - The Company expects to deploy capital to new portfolio companies with favorable risk/reward characteristics in the foreseeable future[3] Dividends and Future Outlook - The Company declared a cash dividend of $0.25 per share, payable on June 28, 2024, to stockholders of record on June 20, 2024[11] - The Company anticipates increased cannabis capital markets activity in the second half of 2024 due to potential regulatory changes[3]

Financial Performance - Total investment income for the three months ended March 31, 2024, was $2,760,247, an increase of 12.3% compared to $2,457,839 for the same period in 2023[18]. - Net investment loss for the three months ended March 31, 2024, was $(79,809), compared to a net investment income of $1,370,723 for the same period in 2023[18]. - The net increase in net assets resulting from operations for the three months ended March 31, 2024, was $519,811, down from $2,357,080 in the same period of the previous year[18]. - The company reported a net change in unrealized appreciation from investments of $599,620 for the three months ended March 31, 2024, compared to $986,357 for the same period in 2023[18]. - Interest income for the three months ended March 31, 2024, was $2,585,068, compared to $2,317,020 for the same period in 2023, reflecting a year-over-year increase of approximately 11.5%[71]. - The company reported a total interest income of $2,726,497 for the three months ended March 31, 2024, which includes $52,951 from payment-in-kind interest[204]. - The company reported a total return based on market value of 16.82% for the three months ended March 31, 2024, compared to a negative return of (6.22)% in the same period of 2023[145]. Assets and Liabilities - Total assets increased to $90,351,075 as of March 31, 2024, up from $88,576,271 at December 31, 2023, representing a growth of approximately 2.0%[15]. - Total liabilities increased to $5,832,308 as of March 31, 2024, from $3,023,653 at December 31, 2023, reflecting a rise of approximately 92.9%[15]. - Cash and cash equivalents rose to $33,160,294 as of March 31, 2024, compared to $32,611,635 at the end of 2023, indicating a 1.7% increase[15]. - As of March 31, 2024, the total net assets of the company decreased to $84,518,767, down from $86,475,729 as of December 31, 2022, reflecting a decrease of approximately 2.3%[21]. - The net asset value per share decreased to $13.60 as of March 31, 2024, from $13.77 at December 31, 2023[15]. Investment Portfolio - The total investment in securities as of March 31, 2024, was $54,851, which constitutes 64.90% of the company's net assets[27]. - The company’s cash equivalents represented 39.23% of total portfolio investments and cash equivalents as of March 31, 2024[27]. - The total fair value of the investment portfolio was $54,851,000, an increase from $54,120,000 as of December 31, 2023, reflecting a net change in unrealized appreciation of $599,620[197]. - The investment portfolio as of December 31, 2023, had an aggregate fair value of approximately $54.1 million, with approximately $46.0 million in first lien, senior secured loans and approximately $8.1 million in senior secured notes across five portfolio companies[190]. - The geographic composition of the portfolio shows that 46.7% is located in the West, 45.8% in the Midwest, and 7.5% in the Northeast as of March 31, 2024[93]. Management and Strategy - The Company plans to expand its investment strategy to include companies outside of the cannabis and health and wellness sectors effective April 22, 2024[48]. - The Company’s investment objective is to maximize risk-adjusted returns primarily through secured debt investments in private leveraged middle-market cannabis companies[44]. - The company intends to maximize risk-adjusted returns on equity for shareholders by capitalizing on growth in the cannabis industry and generating current income from debt investments[170]. - The company expects loans to typically have final maturities of three to six years, with early repayments often occurring within three years[90]. - The company may invest in "covenant-lite" loans, which provide borrowers more freedom and may increase the risk of loss compared to loans with a complete set of financial maintenance covenants[171]. Dividends and Distributions - The Company declared a quarterly dividend of $0.25 per share on March 8, 2024, totaling $1,553,662, while no distributions were made during the same period in 2023[130]. - For the tax year ended March 31, 2024, total distributions amounted to $9,819,273, all classified as ordinary income[142]. Risk Management - The Company manages various risks, including market risk, credit risk, and interest rate risk, through control mechanisms and diversification[97]. - The portfolio is concentrated in cannabis companies, which may subject the Company to greater price volatility compared to a broader range of industries[99]. - As of March 31, 2024, there were no loan investments placed on non-accrual status, indicating effective management of credit risk[70]. Other Financial Metrics - The ratio of expenses to average net assets increased to 3.32% for the three months ended March 31, 2024, compared to 1.26% in the prior year[145]. - The company incurred management fee expenses of $246,131 for the three months ended March 31, 2024, compared to $238,419 for the same period in 2023, indicating an increase of approximately 3%[115]. - The capital gains incentive fee expenses for the three months ended March 31, 2024, were $119,924, down from $142,602 in the same period of 2023, reflecting a decrease of approximately 16%[118].

Financial Data and Key Metrics Changes - For the fiscal year ended December 31, 2023, the company reported investment income of $11.9 million and total expenses of $5.3 million, resulting in net investment income of $6.6 million, which would have been higher without the loan portfolio acquisition expenses [2] - The net investment income per share for the year was $1.07, with a declared dividend of $1.33 [2] - For Q4 2023, gross investment income was $3.6 million, up from $2.9 million in the previous quarter, with net investment income of $1.7 million for the quarter [29] Business Line Data and Key Metrics Changes - The total investment value as of December 31, 2023, was over $54 million, with an average yield to maturity across all investments of 18% [7] - The company has a strong deal pipeline of over $420 million, indicating a robust origination effort despite a slow period in the cannabis sector [24] Market Data and Key Metrics Changes - The company noted improvements in key markets such as California and Michigan, with prices stabilizing and operators re-engaging on growth plans [19] - Positive developments in various states regarding adult-use legislation were highlighted, with Missouri exceeding expectations [33] Company Strategy and Development Direction - The company announced an expansion of its investment strategy to include companies outside of the cannabis and health and wellness sectors, effective around April 22, 2024 [31] - The anticipated closing of the loan portfolio acquisition is expected in mid-2024, subject to SEC review [31] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the industry poised for growth, with improving consumer sentiment and strong demand for cannabis products [33] - The management acknowledged that while some states have underperformed, overall market conditions are improving, and operators are feeling more confident [33] Other Important Information - The company incurred $0.7 million in expenses related to the loan portfolio acquisition, primarily legal fees [15] - The net assets at the end of the period were $85.6 million, with a net asset value per share of $13.77 [15] Q&A Session Summary Question: What are the risks associated with the loan portfolio acquisition not closing? - Management indicated that they are focused on the current plan and believe the transaction is sound for shareholders, with no immediate plan B discussed [35][38] Question: Can you provide more details on improving market conditions? - Management noted that while some states have had disappointing growth, others like Missouri have exceeded expectations, and overall, the industry is seeing positive developments [19][33]

Investment Income - Total investment income for the quarter ended December 31, 2023, was $3.6 million, with net investment income of approximately $1.7 million, or $0.28 per share[5] - Total investment income for the year ended December 31, 2023, was $11,932,900, a significant increase from $4,036,792 for the year ended December 31, 2022[27] - Net investment income for the year ended December 31, 2023, was $6,628,844, compared to $2,196,987 for the previous year, reflecting a growth of approximately 201%[27] - Basic and diluted net investment income per share for the year ended December 31, 2023, was $1.07, up from $0.35 in the previous year[27] Net Assets - The Company recorded a net unrealized gain of $0.8 million during the quarter, leading to a net increase in net assets from operations of $2.5 million, or $0.40 per share[6] - Total net assets as of December 31, 2023, were $85.6 million, compared to $87.4 million as of September 30, 2023[7] - The net increase in net assets resulting from operations for the year ended December 31, 2023, was $7,340,108, compared to $1,923,639 for the previous year[27] - Basic and diluted net increase in net assets resulting from operations per share was $1.18 for the year ended December 31, 2023, compared to $0.31 for the previous year[27] Investment Portfolio - The Company's investment portfolio had an aggregate fair value of approximately $54.1 million, consisting of $46.0 million in secured loans and $8.1 million in secured notes[11] - The Company made no new investments during the quarter ended December 31, 2023, but received full repayment on one of its secured loan investments[11] - The Company anticipates more attractive debt-related investment opportunities throughout the remainder of 2024[3] Dividends - A cash dividend of $0.25 per share was declared, payable on March 28, 2024, to stockholders of record on March 20, 2024[10] Liquidity - As of December 31, 2023, the Company had $32.6 million in available liquidity, all in cash equivalents[9] Expenses - Total expenses for the year ended December 31, 2023, amounted to $5,304,056, up from $1,839,805 in the previous year, indicating a rise of about 188%[27] - Management fees increased to $1,013,764 for the year ended December 31, 2023, from $336,432 in the previous year, representing a growth of approximately 201%[27] - Legal expenses decreased to $343,824 for the year ended December 31, 2023, from $484,412 in the previous year, showing a reduction of about 29%[27] Share Information - Weighted average shares outstanding for basic and diluted calculations were 6,214,682 for the year ended December 31, 2023, slightly up from 6,214,672 in the previous year[27] Realized and Unrealized Gains - The net realized loss from investments was $(210,767) for the year ended December 31, 2023, with a net change in unrealized appreciation of $922,031[27] NAV - As of December 31, 2023, the net asset value (NAV) per share decreased to $13.77 from $14.06 as of September 30, 2023, primarily due to dividend payments[7]