Financial Data and Key Metrics Changes - For Q1 2025, total investment income was $35.4 million, and net investment income was $15.6 million, compared to $33.8 million and $14.6 million in Q4 2024, respectively [5][18] - The net asset value (NAV) per share decreased by 2.2% to $13.48 from $13.79 at the end of Q4 2024 [17] - The total investment portfolio's fair value decreased by 6.7% from $1.08 billion in Q4 2024 to $1 billion in Q1 2025 [17] Business Line Data and Key Metrics Changes - The weighted average portfolio risk rating remained stable at 2.33, indicating consistent credit quality [16] - The loan portfolio is primarily composed of first lien senior secured loans, with 97% being floating rate assets [17][18] - The dollar-weighted average annualized yield on the debt portfolio increased to 15.4% in Q1 2025 from 14.7% in Q4 2024 [18] Market Data and Key Metrics Changes - The company executed three investments in existing portfolio companies totaling $50.7 million in funded loans during Q1 2025 [6][16] - The company noted a cautious approach in the healthcare lending sector, reflecting broader market conditions [26][28] Company Strategy and Development Direction - The company aims to optimize its portfolio and expand origination channels following its merger with BC Partners [5][7] - A strategic focus on credit-first underwriting practices is intended to ensure long-term shareholder value, even if it results in slower portfolio growth [8][9] - The company is positioned to benefit from a strategic focus that diversifies its portfolio and mitigates risk [7] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's ability to navigate ongoing market volatility and emphasized a focus on sustainable growth [12][61] - The management team highlighted a shift in venture-backed companies towards profitability and reduced cash burn, indicating a more cautious investment environment [11][12] - The company anticipates muted deal activity in 2025 but believes there will be a need for non-dilutive growth capital in the future [13] Other Important Information - The company extended its credit facility with KeyBank by three years and restructured its privately placed senior unsecured notes [20] - A new stock repurchase program of $25 million was approved, reflecting management's confidence in the company's valuation [22] - A regular distribution of $0.33 per share and a supplemental dividend of $0.02 per share were declared for Q2 2025 [22] Q&A Session Summary Question: Comments on healthcare lending and its slowdown - Management noted that healthcare lending has been softer and slower, reflecting cautious market conditions [26][27] Question: Update on the investment pipeline - The pipeline is currently seeing a mix of refinances and new opportunities, with a focus on ensuring appropriate structure and pricing [29][30] Question: Trends in net investment income (NII) and dividend declaration - The supplemental dividend for Q2 is lower due to a strategic decision to build NAV rather than prioritize dividend payouts [35][36] Question: Impact of private credit market conditions on pipeline - There is an improvement in the structure of the pipeline, with lower asks in terms of leverage and maintenance of quality covenants [42][43] Question: Highlights of realized gains and unrealized portfolio depreciation - Realized gains were driven by the sale of Gynasonics, while depreciation was influenced by performance and market multiples [50][52]

Portman Ridge Finance (PTMN) Q1 2025 Earnings Call May 09, 2025 10:00 AM ET Company Participants Ted Goldthorpe - CEO & DirectorPatrick Schafer - Chief Investment Officer & DirectorBrandon Satoren - Chief Financial Officer, Secretary & TreasurerErik Zwick - Managing Director, Equity ResearchChristopher Nolan - Senior VP - Equity ResearchSteven Martin - President Conference Call Participants None - Analyst Operator Welcome to Apartment Ridge Finance Corporation's First Quarter Ended 03/31/2025 Earnings Confe ...

Financial Data and Key Metrics Changes - For Q1 2025, Portman Ridge generated $12.1 million in investment income, a decrease of $2.3 million or $0.25 per share compared to $14.4 million reported for Q4 2024 [10] - Net investment income for Q1 2025 was $4.3 million or $0.47 per share, down $1.2 million or $0.13 per share from $5.5 million or $0.60 per share in the previous quarter [12] - Net asset value (NAV) as of March 31, 2025, was $173.5 million, representing a decrease of $5 million from $178.5 million as of December 31, 2024 [12] Business Line Data and Key Metrics Changes - The company deployed approximately $17.5 million into defensively positioned opportunities during the quarter, with $15.7 million in repayments and sales, resulting in a net deployment of approximately $1.8 million [3][4] - The overall yield on new investments during the quarter was 10.6%, slightly below the overall portfolio yield of 11% [8] Market Data and Key Metrics Changes - Approximately 88.5% of the debt securities portfolio was based on floating rates, primarily linked to SOFR, which has slightly decreased over the last few quarters [7] - The company had six investments on non-accrual status at the end of Q1 2025, representing 2.64% of the investment portfolio at fair value [8] Company Strategy and Development Direction - The merger with Logan Ridge is expected to provide increased scale, improved liquidity, and greater operational efficiency, enhancing long-term shareholder value [4] - The company emphasizes a disciplined investment strategy and prudent risk management in the current unpredictable macroeconomic environment [5] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the ability to drive strong returns and maintain credit quality despite the uncertain macroeconomic backdrop shaped by inflation and shifting trade dynamics [5][6] - The company remains cautious about the economic environment, anticipating that demand may have been pulled forward and that the economy is unlikely to improve in the near term [21] Other Important Information - The Board of Directors approved a stable base distribution of $0.47 per share, which is anticipated to be sustainable across market cycles [5] - The company has a healthy pipeline and is focused on thoughtful deployment and rigorous underwriting to differentiate itself in the market [6] Q&A Session Summary Question: Follow-up on Sundance interest reversal - The out-of-period impact from Sundance was approximately $450,000 [15] Question: Normalized level of investment income - The decrease in total investment income was influenced by a $600,000 increase in PIK income, with expectations for normalization in the coming quarters [17][18] Question: Composition of the pipeline - The pipeline is described as healthy and robust, with a focus on service-related businesses, healthcare, and software [19][25] Question: Dividend policy clarification - The company set a base dividend of $0.47 and will pay approximately 50% of incremental NII above the base, explaining the absence of a supplemental dividend this quarter [29] Question: Risks regarding private equity sponsors - The company noted that middle-market sponsors have been supportive, and negotiations have been relatively non-controversial [30][31] Question: Non-accrual investments and recovery prospects - The company discussed two main positions in non-accrual status, with potential upside for cash interest being turned back on for Sundance and Naviga [36][38] Question: KCAP Freedom III dividend status - The company confirmed that distributions from KCAP Freedom III have been recognized as a return of capital rather than income [50][51]

The market has been rebounding during earnings season as tariff and trade pressure seem to be less concerning than they once were. The Fed kept rates unchanged but is expected to start cutting this summer. I am looking for opportunities to front-runI am focused on growth and dividend income. My personal strategy revolves around setting myself up for an easy retirement by creating a portfolio which focuses on compounding dividend income and growth. Dividends are an intricate part of my strategy as I have str ...

Great Elm Capital (GECC) Q1 2025 Earnings Call May 06, 2025 08:30 AM ET Company Participants Peter Sceusa - Investor Relations Senior AssociateMatt Kaplan - CEO & PresidentKeri Davis - CFO & TreasurerMichael Keller - President - Specialty Finance BusinessMickey Schleien - Managing Director, Equity ResearchErik Zwick - Managing Director, Equity ResearchMitchel Penn - Managing Director Operator Greetings and welcome to the Great Elm Capital Corp First Quarter twenty twenty five Financial Results Call. At this ...

Group 1 - The article presents a bullish perspective on investing in high-quality Business Development Companies (BDCs), highlighting their attractive double-digit yields and uncorrelated income streams [1] - Roberts Berzins has over a decade of experience in financial management, focusing on helping top-tier corporates with financial strategies and large-scale financings [1] - Berzins has contributed to the institutionalization of the REIT framework in Latvia, aiming to enhance the liquidity of pan-Baltic capital markets [1] Group 2 - The article mentions Berzins' involvement in developing national SOE financing guidelines and frameworks to channel private capital into affordable housing [1] - Berzins holds a CFA Charter and an ESG investing certificate, indicating a strong background in investment analysis and sustainable investing [1] - His experience includes an internship at the Chicago Board of Trade, showcasing a diverse financial background despite residing in Latvia [1]

Earnings season has reached the business development sector and one of the first BDCs that reported earnings for Q1 2025 was Ares Capital Corp. (NASDAQ: ARCC ) , the biggest BDC in the industry by market capitalization.A financial researcher and avid investor with a keen eye for innovation and disruption, as well as growth buy-outs and value stocks. Keeping an eye on the pace of high tech and early growth companies, I write about current events and the biggest news surrounding the industry, and strive to pr ...

Sixth Street Specialty Lending (TSLX) Q1 2025 Earnings Call May 01, 2025 08:30 AM ET Company Participants Cami VanHoard - Head of Investor RelationsJoshua Easterly - Chairman, CEO & Co-CIO of the AdviserRobert Stanley - Vice PresidentIan Simmonds - CFOFinian O'shea - Director, WFS ResearchBrian Mckenna - Director - Equity ResearchMickey Schleien - Managing Director, Equity ResearchKenneth Lee - Vice PresidentMaxwell Fritscher - Equity Research AssociateMelissa Wedel - Vice President, U.S. Equities ResearchR ...

Financial Data and Key Metrics Changes - The company reported adjusted net investment income of $0.58 per share, with an annualized return on equity of 13.5%, and adjusted net income of $0.36 per share, with an annualized return on equity of 8.3% for Q1 2025 [8][32] - Total investments decreased to $3.4 billion from $3.5 billion in the prior quarter due to net repayment activity [32] - The weighted average yield on debt and income-producing securities decreased slightly from 12.5% to 12.3% quarter over quarter [24] Business Line Data and Key Metrics Changes - In Q1, the company provided total commitments of $154 million and total funding of $137 million across six new portfolio companies and upsizes to four existing investments [16] - The company experienced $270 million of repayments from seven full and four partial investment realizations, resulting in $133 million of net repayment activity [16] - 89% of total funding this quarter was into new investments, with 11% supporting upsizes to existing portfolio companies [20] Market Data and Key Metrics Changes - The U.S. direct lending market has seen an imbalance with the supply of capital outpacing demand, primarily due to the growth of retail investor-oriented perpetual non-traded BDC structures [14] - The company anticipates that current uncertainty and volatility will moderate the supply and demand imbalance by slowing inflows into non-traded vehicles [15] Company Strategy and Development Direction - The company emphasizes a disciplined capital allocation strategy, with portfolio yields significantly higher than the sector average, at a weighted average yield of 12.5% compared to 11.6% for peers [11] - The company is well-positioned with significant liquidity and capital to invest in what is expected to be a more interesting investment environment [12] - The company plans to maintain a conservative approach to new investments, focusing on risk-adjusted returns and avoiding participation in deals that do not align with shareholder interests [22] Management's Comments on Operating Environment and Future Outlook - Management believes the business remains well protected on the asset side with limited direct exposure to tariffs and is positioned well on the liability side [7] - The company anticipates a quarterly earnings power of approximately $0.50 per share, with potential upside if activity-based fees return to historical averages [10] - Management expressed confidence in the portfolio's credit quality, with non-accruals representing only 1.2% of the portfolio at fair value [26] Other Important Information - The board approved a base quarterly dividend of $0.46 per share and a supplemental dividend of $0.06 per share [12][13] - The company completed two capital market transactions in Q1, including a $300 million issuance of long five-year notes [32] Q&A Session Summary Question: Impact of downward pressure on spreads due to non-traded BDC fundraising - Management noted that retail flows have likely slowed due to market volatility, and the company has a resilient business model that is not solely dependent on sponsor deals [42][44] Question: Outlook for M&A activity - Management is negative on the return of M&A activity in the near term, citing overvaluation of assets and the need for time and growth [51][52] Question: Pricing risk in a volatile environment - Management indicated that the private markets are not effectively pricing risk, but the company uses a fundamental approach to assess asset value and required returns [59] Question: Deployment opportunities in lane two and lane three investments - Management is starting to see more opportunities in these areas but anticipates that more stress is needed across sectors for significant deployment [80] Question: Frequency of capital raises with the ATM program - Management confirmed that there will be no change in the frequency of capital raises, emphasizing that any issuance must be accretive to shareholders [84]

Financial Data and Key Metrics Changes - The company reported GAAP net income per share of $0.56 for Q1 2025, down from $0.76 in Q1 2024 and $0.55 in the previous quarter [19] - Core earnings per share were $0.50, compared to $0.59 a year ago and $0.55 in the prior quarter, primarily due to a decline in portfolio yields [19][20] - The total portfolio at fair value increased to $27.1 billion from $26.7 billion in the previous quarter and $23.1 billion a year ago [21] Business Line Data and Key Metrics Changes - The company originated $3.5 billion in new investment commitments during Q1 2025, with approximately 60% coming from existing borrowers [26] - The weighted average yield on debt and other income-producing securities at amortized cost was 11.1% at the end of Q4 2024, down to 10.1% by the end of Q1 2025 [20] - The average debt to EBITDA ratio for portfolio companies was 5.7 times, the lowest since Q1 2020, indicating improved leverage [29] Market Data and Key Metrics Changes - New transaction activity in the liquid loan market dropped significantly as banks became more cautious, while the direct lending market remained stable [10][11] - The company noted increased volatility and widening spreads in secondary loan markets, with banks transitioning to a risk-off position [10][11] - The company has a significant amount of available capital totaling nearly $6.8 billion, positioning it well for new investments [14] Company Strategy and Development Direction - The company aims to capitalize on opportunities arising from market volatility, leveraging long-standing relationships to source deals [12][13] - The focus remains on service-oriented businesses that are more insulated from tariff impacts, with proactive engagement with portfolio companies to mitigate risks [15][17] - The company declared a quarterly dividend of $0.48 per share, marking the 63rd consecutive quarter of stable or increasing dividends [17][24] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in navigating future market conditions, citing a strong investment team and a healthy portfolio [12][13] - The company anticipates a slower M&A environment but believes long-term drivers for M&A remain intact [11] - Management highlighted the importance of proactive communication with market participants to ensure readiness for new opportunities [12] Other Important Information - The company has a low non-accrual rate of 1.5% at cost, down from 1.7% in the previous quarter, indicating strong credit quality [29] - The company has a significant taxable income spillover estimated at $883 million or $1.29 per share available for distribution in 2025 [24] Q&A Session Summary Question: Impact of private BDCs on pricing and competitive position - Management noted that spreads have already begun to widen, indicating a shift in the market dynamics, and expressed confidence in outperforming competitors [35][36] Question: Analysis of tariff exposure - Management conducted a thorough analysis of portfolio companies' exposure to tariffs, finding a mid-single-digit percentage of companies potentially impacted [39][41] Question: Outlook on M&A deal volume - Management acknowledged the slowdown in M&A activity but emphasized their ability to capture market share in the current environment [45][47] Question: Strategies for managing rising costs of liabilities - Management highlighted their historical ability to maintain consistent ROE and mentioned potential strategies such as leveraging and utilizing spillover income [51][54] Question: Backlog and deal closure uncertainty - Management indicated that while there may be some uncertainty regarding the backlog due to market volatility, they remain optimistic about closing existing deals [75][77]