OFS Capital(US:OFS)2021-05-11 16:40Financial Data and Key Metrics Changes - Adjusted net investment income was $0.23 per share, up 5% from the last quarter, with NAV increasing approximately 1% to $11.96 per share as of March 31 [10][23] - The weighted average cost of debt decreased from 5.49% to 5.16% due to capital raising activities [10] - Quarterly distribution increased by 10% from $0.20 to $0.22 per share, marking the third consecutive quarterly increase [11][27] Business Line Data and Key Metrics Changes - No new loans or non-accruals were reported, indicating portfolio resilience [11] - Total investment income decreased by approximately $600,000 to $10.5 million, primarily due to lower prepayment fees and common equity dividends [25] - Total expenses decreased by approximately $200,000 to $7.9 million, attributed to lower incentive fees [26] Market Data and Key Metrics Changes - Approximately 96% of the loan portfolio was senior secured at the end of the first quarter, with 93% of loan investments being floating rate [14][29] - The portfolio consisted of 87 companies totaling approximately $466 million in fair value [28] Company Strategy and Development Direction - The company aims to preserve capital while thoughtfully growing earnings, focusing on increasing origination activities and reducing the cost of debt [12] - The company is positioned to benefit from an eventual increase in interest rates due to its floating-rate assets and primarily fixed-rate financing [15][36] - The company continues to avoid highly cyclical industries, maintaining a diversified portfolio across healthcare, technology, business services, and manufacturing [14] Management's Comments on Operating Environment and Future Outlook - Management is optimistic about the economic recovery due to favorable fiscal and monetary policies, while remaining cautious [20] - Increased pipeline activity through new and existing borrowers is expected to lead to an increase in net investment income over time [16] - The company has a solid liquidity position, which will help in seizing new investment opportunities [34] Other Important Information - The company has a debt to equity ratio of approximately 1.4 times, with 90% of its debt maturing in 2024 or later [22] - The adviser manages over $2.5 billion in assets and has extensive experience in credit underwriting and restructuring [18][37] Q&A Session Summary - There were no questions during the Q&A session [40]