Rand Capital(RAND) - 2024 Q3 - Quarterly Report

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$1,741,114 for the same period in 2023[151]. - Interest from portfolio companies increased by $409,918, or 26.7$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$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$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].