Great Elm Capital Corp. Announces Second Quarter 2025 Financial Results

Core Viewpoint - Great Elm Capital Corp. reported a strong second quarter for 2025, achieving record total investment income and net investment income (NII) that surpassed its increased quarterly distribution, driven by robust cash generation and solid performance from its investments [3][6]. Financial Highlights - Total investment income for Q2 2025 was a record $14.3 million, with cash income making up over 90% of this total [6]. - NII for Q2 2025 was $5.9 million, or $0.51 per share, compared to $4.6 million, or $0.40 per share, in Q1 2025, marking a significant increase [6][9]. - The net asset value (NAV) per share increased to $12.10 as of June 30, 2025, up from $11.46 at the end of Q1 2025, primarily due to unrealized gains on investments [6][9]. - The company declared a quarterly dividend of $0.37 per share for Q3 2025, reflecting a 13.5% annualized yield based on the closing price of $10.98 on August 1, 2025 [12]. Portfolio and Investment Activity - As of June 30, 2025, GECC held total investments valued at $335.1 million, with 55 debt investments in corporate credit totaling approximately $197.3 million, representing 58.9% of the fair market value of total investments [5][6]. - The weighted average current yield on the debt portfolio was 12.5%, with floating rate instruments comprising about 73% of the fair market value of debt investments [7]. - During Q2 2025, GECC deployed approximately $22.6 million into 26 investments at a weighted average current yield of 14.1% [7]. Management Commentary - The CEO highlighted the company's strong momentum in 2025, emphasizing the record NII and the expectation that NII will continue to exceed distributions for the full year despite anticipated fluctuations in cash flows from the CLO joint venture [3]. - The company plans to monitor the macro environment closely and seek capital deployment opportunities that offer compelling risk-adjusted returns [3]. Liquidity and Capital Resources - As of June 30, 2025, GECC had cash and money market fund investments totaling approximately $4.4 million, along with $19.0 million available under its $25.0 million revolving line of credit [10]. - Total debt outstanding was $201.4 million, which includes various senior notes and amounts drawn from the revolving credit facility [11]. Earnings Per Share Data - The earnings per share (EPS) for Q2 2025 was $1.02, a significant increase from a loss of $0.14 in Q2 2024 [4][23]. - The NII per share for Q2 2025 was $0.51, compared to $0.32 in Q2 2024 [4][23]. Conference Call and Webcast - The company will host a conference call and webcast on August 5, 2025, to discuss these results in detail [13][15].