Silver Spike Investment (SSIC) - 2025 Q1 - Quarterly Report

Financial Performance - For the three months ended March 31, 2025, total investment income was $11,923,002, a significant increase from $2,760,247 for the same period in 2024, representing a growth of approximately 332%[13] - Net investment income for the three months ended March 31, 2025, was $7,648,421, compared to a net loss of $79,809 for the same period in 2024, indicating a turnaround in performance[13] - The net increase in net assets resulting from operations for the three months ended March 31, 2025, was $7,614,357, compared to $519,811 for the same period in 2024, showing a substantial improvement[13] - The net investment income per share for the three months ended March 31, 2025, was $0.34, compared to a loss of $0.01 per share for the same period in 2024[13] - The weighted average shares outstanding for the three months ended March 31, 2025, were 22,820,386, compared to 6,214,941 for the same period in 2024, indicating a significant increase in shares[13] Expenses and Cash Flow - Total expenses for the three months ended March 31, 2025, were $5,249,058, up from $2,840,056 in the same period in 2024, reflecting an increase of approximately 84%[13] - The net cash provided by (used in) operating activities was $(7,264,322) for the current period, a decrease from $2,103,079 in the prior year[20] - Cash and cash equivalents at the end of the period were $14,921,739, down from $33,160,294 at the end of March 31, 2024, reflecting a decrease of approximately 55.1%[20] - The company incurred offering costs of $989,645 during the current period, compared to $756 in the previous year, indicating increased financing activities[20] - The net cash used in financing activities was $(1,746,345), compared to $(1,554,420) in the prior year, showing a slight increase in cash outflow[20] Investment Portfolio - Total investments amount to $288,403,000, with a fair value of $289,264,000, representing 96.1% of net assets[24] - Total Cannabis investments amount to $210,854 million, representing 70.2% of net assets[23] - The company holds equity investments valued at $743,000, with a fair value of $688,000, accounting for 0.2% of total assets[24] - The total fair value of cannabis-related investments is $202.67 million, with a par value of $203.45 million[34] - The total amount of first lien senior secured U.S. debt is $240,063 million, which is 80.0% of net assets[23] Risks and Future Outlook - The company has identified various risks that could impact future performance, including changes in regulation affecting the cannabis industry and potential economic disruptions[8] - The company anticipates continued growth in investment income and is focused on expanding its portfolio and operational capabilities[7] - The company faces significant risks related to interest rate fluctuations, which could materially affect net investment income[112] - The company manages various risks, including market risk and credit risk, through diversified exposures and control mechanisms[102] Shareholder Distributions - The Company declared a quarterly dividend of $0.34 per share on March 14, 2025, totaling $7,758,931, compared to a dividend of $0.25 per share totaling $1,553,736 declared on March 8, 2024[155] - The total distributions for the tax year ended March 31, 2025, were $18,625,335, compared to $9,819,273 for the tax year ended March 31, 2024, indicating a substantial increase[173] Tax and Compliance - The Company intends to maintain its tax treatment as a RIC, requiring it to distribute at least 90% of its investment company taxable income annually[78] - The Company evaluates tax positions and has no uncertain tax positions as of March 31, 2025, indicating a stable tax compliance status[82] - As of March 31, 2025, the Company had $0 in accrued excise taxes, down from $88,709 as of December 31, 2024, indicating improved tax management[79] Valuation and Fair Value - The company utilizes significant unobservable inputs for valuing securities, categorized as Level 3 assets[25] - The company has adopted a multi-step valuation process for its investments, which includes establishing preliminary valuations based on independent third-party valuations[65] - The fair value of First Lien Senior Secured Loans increased from $239,860,206 as of December 31, 2024, reflecting a net change in unrealized appreciation of $74,055[122] Management and Governance - The Adviser waived approximately $658,477 of general and administrative expenses for the three months ended March 31, 2025, which will not be subject to future reimbursement[144] - The Company had co-investments with affiliates amounting to $245,658,531 as of March 31, 2025, down from $272,816,695 as of December 31, 2024[148] - The Expense Limitation Agreement caps the Company's operating expenses at an annualized rate of 2.15% of net assets through September 30, 2025[136]