Hercules Capital(HTGC) - 2024 Q4 - Annual Results

Financial Performance - Record Full-Year 2024 Total Investment Income of $493.6 million, an increase of 7.1% year-over-year[1] - Record Full-Year 2024 Net Investment Income (NII) of $325.8 million, an increase of 7.2% year-over-year, equating to $2.00 per share[1][2] - Q4 2024 NII of $81.1 million, or $0.49 per share, providing 123% coverage of the base cash distribution[1][3] - Total investment income for the three months ended December 31, 2024, was $121.784 million, a slight decrease of 0.67% from $122.603 million in the same period of 2023[63] - Net investment income for the twelve months ended December 31, 2024, increased to $325.832 million, up from $304.037 million in 2023, representing a growth of 7.2%[63] - Basic net investment income per common share for the three months ended December 31, 2024, was $0.49, compared to $0.56 in the same period of 2023[63] Assets and Investments - Approximately $4.8 billion of Assets Under Management, an increase of 14.2% year-over-year[2] - The total investments at cost as of December 31, 2024, were $3,708.8 million, compared to $3,609.9 million as of September 30, 2024[29] - Hercules' total investments at fair value amounted to $3,659.978 million, up from $3,248.046 million in 2023[60] - Hercules' total assets as of December 31, 2024, were $3,831.591 million, compared to $3,416.926 million in 2023[60] - Hercules held equity positions in 72 portfolio companies with a fair value of $128.7 million as of December 31, 2024[46] Liabilities and Commitments - Total liabilities increased to $1,842.010 million as of December 31, 2024, from $1,614.220 million in 2023[60] - The Company had $448.5 million of available unfunded commitments, representing 11.7% of total assets, a decrease from $489.0 million or 13.4% in the previous quarter[36] - Q4 2024 Total Gross Debt and Equity Commitments of $619.5 million[3][9] Distributions and Shareholder Returns - New Supplemental Cash Distribution for 2025 announced at $0.28 per share, payable over four quarters[2] - Distributions paid per common share remained stable at $0.48 for the three months ended December 31, 2024, consistent with the same period in 2023[63] Operating Expenses - Total gross operating expenses for the twelve months ended December 31, 2024, were $178.539 million, an increase from $165.732 million in 2023, reflecting a rise of 7.3%[63] - Employee compensation expenses for the twelve months ended December 31, 2024, totaled $67.074 million, up from $63.500 million in 2023, indicating a growth of 5.5%[63] Net Asset Value - As of December 31, 2024, the Company's net assets were $1.99 billion, up from $1.85 billion at the end of Q3 2024, with NAV per share increasing 2.3% to $11.66[41] - The net asset value per share increased to $11.66 as of December 31, 2024, compared to $11.43 in 2023[60] Unrealized Gains and Losses - Net Unrealized Appreciation of $13.8 million recorded in Q4 2024, net of foreign currency movements[23] - The net change in unrealized appreciation for the three months ended December 31, 2024, was $13.773 million, down from $31.287 million in the same period of 2023[63] Debt and Leverage - Net GAAP Leverage of 83.9% and Net Regulatory Leverage of 69.9% as of year-end[2] - Hercules' GAAP leverage ratio was 89.6%, with a regulatory leverage ratio of 75.6% excluding SBA debentures[34] Loan Performance - The number of loans on non-accrual decreased to one, with an investment cost of approximately $61.3 million and fair value of $18.2 million, representing 1.7% and 0.5% of the total investment portfolio at cost and value, respectively[27] Recent Transactions - Hercules closed $619.5 million in new debt and equity commitments in Q4 2024, with pending commitments of $578.5 million in signed non-binding term sheets as of February 10, 2025[37] - Hercules' portfolio company Voyager Technologies, Inc. confidentially filed for an IPO in January 2025, with Hercules committing $58.0 million in venture debt starting June 2024[49] - Sandata Technologies, LLC was acquired by HHAeXchange in October 2024, with Hercules providing $22.5 million in venture debt financing beginning May 2024[49] - Snagajob.com, Inc. was acquired by JobGet in November 2024, with Hercules having committed $93.2 million in venture debt financing since June 2016 and holding warrants for 600,000 shares of common stock[49] - Kineta, Inc. announced its acquisition by TuHURA Biosciences, Inc. for $30.0 million in November 2024, with Hercules committing $20.0 million in venture debt financing since December 2019[49] - Ikon Science was acquired by Vela Software in December 2024, with Hercules committing $24.0 million in venture debt financing since October 2019[50] Debt Repayment - Hercules fully repaid $50.0 million principal and $1.1 million of accrued interest on February 5, 2025[53]