Oxford Square Capital (US:OXSQ)2022-11-07 17:23Financial Data and Key Metrics Changes - For the quarter ended September 30, net investment income was approximately $5.6 million or $0.11 per share, an increase from $4.3 million or $0.09 per share in the prior quarter [6] - Net asset value per share grew to $3.34 compared to $3.67 in the prior quarter [6] - Total investment income for the third quarter was approximately $11.4 million, up from approximately $9.9 million in the prior quarter, driven by increased interest income and income from CLO equity investments [7] Business Line Data and Key Metrics Changes - The company recorded net unrealized depreciation on investments of approximately $16.8 million or $0.34 per share, a decrease from $46.2 million or $0.93 per share in the prior quarter [8] - Realized gains on investments were approximately $56,000 compared to realized losses of $1.5 million in the prior quarter [8] - Investment activity included purchases of approximately $3.9 million and sales and repayments of approximately $12.8 million, with cash and cash equivalents of approximately $14.4 million as of September 30 [9] Market Data and Key Metrics Changes - The U.S. loan market experienced volatility, with loan prices increasing from 92.16% at par as of June 30 to 95.50% at par on August 12, before dropping to 91.92% at par by September 30 [12] - The 12-month trailing default rate for the Morningstar LSTA U.S. Leveraged Loan Index increased to 0.9% by principal amount at the end of the quarter from 0.28% at the end of June 2022 [13] - The distress ratio, defined as the percentage of loans with a price below 80% of par, ended the quarter at approximately 6%, up from 3.65% at the end of June 2022 [14] Company Strategy and Development Direction - The company continues to focus on portfolio management strategies designed to maximize long-term total return, leveraging its position as a permanent capital vehicle to take a longer view towards investment strategy [15] Management's Comments on Operating Environment and Future Outlook - Management noted that primary market issuance was approximately $21 billion, representing an 87% decline compared to the same quarter in the previous year, driven by lower refinancing, M&A, and LBO activity [14] - U.S. fund outflows were approximately $11.5 billion for the quarter ended September 30, indicating a challenging market environment [15] Other Important Information - The Board of Directors declared monthly distributions of $0.035 per share for each of the months ending January, February, and March of 2023 [10] Q&A Session Summary - There were no questions from participants during the Q&A session [19][20]