SLR Investment (US:SLRC)2025-05-07 20:06Investment Activity - For the three months ended March 31, 2025, the company invested approximately $193.5 million across 30 portfolio companies, compared to $100.2 million in 24 portfolio companies during the same period in 2024[199]. - During the three months ended March 31, 2025, investments sold, prepaid, or repaid totaled approximately $196.9 million, compared to $131.0 million for the same period in 2024[199]. - As of March 31, 2025, SLR Credit had 28 funded commitments to 22 different issuers with total funded loans of approximately $295.0 million[204]. - As of March 31, 2025, SLR Equipment had a total net investment in leases and loans of approximately $318.5 million on total assets of $355.6 million, with 503 funded equipment-backed leases and loans to 282 different customers[208]. - SLR Healthcare's portfolio totaled approximately $288.3 million of commitments with a total net investment in loans of $143.1 million on total assets of $151.4 million as of March 31, 2025[213]. - As of March 31, 2025, SLR Business Credit managed a portfolio totaling approximately $886.1 million of commitments, with approximately $526.4 million funded[215]. - SSLP's portfolio consisted of floating rate senior secured loans to 31 different borrowers as of March 31, 2025[219]. Financial Performance - The company primarily generates revenue from interest and dividend income, with debt investments typically bearing interest at a floating rate[196]. - For the three months ended March 31, 2025, net investment income was $2,051,000, down from $3,082,000 for the same period in 2024, reflecting a decrease of approximately 33.4%[230]. - Gross investment income decreased to $53.2 million for the three months ended March 31, 2025, compared to $58.1 million in the same period of 2024, a decline of about 5.3%[242]. - The net increase in net assets from operations was $19.9 million for the three months ended March 31, 2025, compared to $27.9 million in 2024, a decrease of about 28.6%[247]. - For the three months ended March 31, 2025, SLR Equipment reported a net loss of $1.9 million on gross income of $6.7 million[208]. - For the three months ended March 31, 2025, SLR Business Credit had net income of $2.6 million on gross income of $12.9 million[215]. - As of March 31, 2025, KBHT had total assets of $882.7 million and net income of $3.4 million on gross income of $97.9 million[210]. Capital Structure and Financing - The company declared a quarterly distribution of $0.41 per share, payable on June 27, 2025, to holders of record as of June 13, 2025[194]. - The board authorized a share repurchase program for up to $50 million of the company's outstanding shares, expected to be in place until May 7, 2026, or until the repurchase amount is reached[192]. - The Company closed a private offering of $50 million of unsecured notes with a fixed interest rate of 6.14% on February 18, 2025, maturing on February 18, 2028[252]. - The Company has outstanding borrowings under the Credit Facility totaling $536.2 million, composed of $396.2 million of revolving credit and $140 million of term loans as of March 31, 2025[254]. - The Company has a total of $75 million in unsecured notes with a fixed interest rate of 4.375% maturing on December 15, 2026[260]. - The Company has $359 million in unsecured senior notes due within 1-3 years as of March 31, 2025[263]. - The Company has committed $50 million to SSLP for providing administrative services[268]. Asset Management and Coverage Ratios - As of March 31, 2025, the company's portfolio consisted of 118 portfolio companies, with 28.6% in cash flow senior secured loans and 38.9% in asset-based senior secured loans[200]. - The asset coverage ratio is calculated based on consolidated total assets less liabilities not represented by senior securities[272]. - As of March 31, 2025, the asset coverage ratio was 194.5%[272]. - The company had total unfunded capital commitments of $268.6 million as of March 31, 2025, compared to $234.6 million as of December 31, 2024[273]. - The largest unfunded capital commitment was $44.3 million for SLR Credit Solutions as of March 31, 2025[273]. - The company had a total of 33 different unfunded capital commitments listed as of March 31, 2025[273]. Risk Management and Compliance - The company must maintain at least 70% of its total assets in qualifying assets as specified in the 1940 Act[195]. - The company is in compliance with all financial and operational covenants required by the Debt Instruments as of March 31, 2025[261]. - The company has no interest rate hedging instruments outstanding on its balance sheet as of March 31, 2025[286]. - The company may face adverse tax consequences if it does not distribute a certain percentage of its income annually[279]. - The company is subject to financial market risks, including changes in interest rates and geopolitical events, which could materially impact its market risks[285]. Future Projections and Distributions - Cash distributions per share for fiscal 2025 are projected to total $0.82, compared to $1.64 for fiscal 2024 and $1.64 for fiscal 2023[276]. - Future quarterly distributions will be determined by the Board and may be affected by asset coverage tests and credit facility provisions[279]. - A hypothetical 1% decrease in SOFR would decrease net investment income by $0.03 per average share over the next twelve months[287]. - The company has exposure to foreign currencies through various investments, which may be mitigated by borrowing in those currencies or entering into forward contracts[287].