Hercules Capital(US:HTGC)2025-10-30 20:30Financial Performance - Q3 2025 total new debt and equity commitments reached $846.2 million, a 96.5% increase year-over-year[2] - Record Q3 2025 total fundings amounted to $504.6 million, reflecting an 85.5% year-over-year increase[2] - Total investment income for Q3 2025 was $138.1 million, up 10.3% from Q3 2024[2] - Net investment income (NII) for Q3 2025 was $88.6 million, or $0.49 per share, providing 122% coverage of the base cash distribution[1][5] - Year-to-date total new debt and equity commitments reached $2.87 billion, a 38.2% increase year-over-year[6] - Year-to-date total fundings were $1.75 billion, an increase of 30.9% year-over-year[6] - Total investment income for the nine months ended September 30, 2025, was $395.1 million, an increase from $371.8 million in 2024[60] - Net investment income for the three months ended September 30, 2025, was $88.6 million, compared to $83.2 million for the same period in 2024[60] - Core investment income on a non-GAAP basis for Q3 2025 was $124,746,000, up from $113,257,000 in Q3 2024, reflecting a year-over-year increase of 10.2%[62] Asset and Investment Management - The company had over $1.0 billion of available liquidity as of the end of Q3 2025[1] - Net asset value (NAV) increased to $12.05, a 1.8% rise from Q2 2025[6] - The net asset value (NAV) per share increased by 1.8% to $12.05, with total net assets remaining at $2.2 billion[37] - As of September 30, 2025, the total investments at cost amounted to $4,290.8 million, an increase from $4,192.5 million in Q2 2025[26] - Total investments at fair value increased to $4,306.2 million as of September 30, 2025, up from $3,660.0 million at December 31, 2024[57] - Hercules' net asset value per share increased to $12.05 as of September 30, 2025, from $11.66 at December 31, 2024[57] Debt and Leverage - Hercules' GAAP leverage ratio was 99.5%, while the regulatory leverage ratio was 83.6% as of September 30, 2025[29] - The GAAP leverage ratio as of September 30, 2025, was 99.5%[64] - The net leverage ratio, after accounting for cash and cash equivalents, was 98.2%[64] - The GAAP regulatory leverage ratio was reported at 83.6% as of September 30, 2025[65] - The net regulatory leverage ratio, after adjustments, stood at 82.3%[65] - Total liabilities rose to $2,220.3 million as of September 30, 2025, compared to $1,842.0 million at December 31, 2024[57] Investment Commitments - The Company closed $846.2 million in new debt and equity commitments in Q3 2025, with pending commitments of $425.5 million as of October 28, 2025[33] - Hercules has committed over $25 billion to more than 700 companies since its inception in December 2003[51] - The Company has $437.5 million of available unfunded commitments, representing 9.9% of total assets[32] Portfolio and Financing Activities - Hercules committed $120.0 million in venture debt financing to Akero Therapeutics, which announced an acquisition by Novo Nordisk for up to $5.2 billion[45] - Hercules Capital committed $50.0 million in venture debt financing to SingleStore, Inc. and holds 580,983 shares of Preferred Series E stock as of September 30, 2025[49] - Signal AI received a $165.0 million growth-equity investment led by Battery Ventures, with Hercules committing $30.0 million in venture debt financing[49] - HilleVax, Inc. entered a merger agreement with XOMA Royalty Corporation, with Hercules having committed $150.0 million in venture debt financing[49] Interest Rate Sensitivity - 97.8% of the debt investment portfolio was priced at floating interest rates, indicating high sensitivity to interest rate changes[38] - The debt investment portfolio's GAAP effective yield was 13.5% in Q3 2025, compared to 13.9% in Q2 2025[12] - The effective yield on a GAAP basis for Q3 2025 was 13.5%, down from 13.9% in Q2 2025[63] - The core yield remained stable at 12.5% for both Q3 2025 and Q2 2025[63] Non-Accrual Loans - The number of loans on non-accrual increased to 1.1% of total investments at value, with a cost percentage of 1.2% as of September 30, 2025[26][24]