The following is a summary of the Stellus Capital Investment Corporation (SCM) Q3 2024 Earnings Call Transcript:

Financial Performance:

• Stellus Capital reported Q3 GAAP net investment income of $0.39 per share and core net investment income of $0.40 per share.

• Net asset value per share increased by $0.19 during the quarter due to net unrealized depreciation on investment portfolio primarily related to one equity investment.

• The investment portfolio at fair value was $908.7 million across 99 portfolio companies, up from $899.7 million across 100 companies at the end of the previous quarter.

• Dividend for the fourth quarter declared at a rate of $0.40 per quarter payable monthly.

Business Progress:

• Invested $9.4 million in one new portfolio company and received full repayment of $8.4 million along with other repayments totaling $5.5 million at par.

• An equity realization yielded proceeds of $2.6 million and a realized gain of $2.2 million, contributing to financial results.

• Increased the bank facility by $55 million from $260 million to $315 million for further growth potential.

Opportunities:

• Anticipate portfolio growth to reach between $930 million and $950 million by the end of Q4 based on an active pipeline.

• Potential loan repayments and equity realization proceeds in Q4 expected to result in realized gains.

Risks:

• Six portfolio companies on non-accrual, comprising 4.7% of the total loan portfolio's fair value, indicating potential risk in asset quality.

• An expected decline in SOFR impacting the net investment income.

More details: Stellus Capital Investment IR

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