The following is a summary of the Portman Ridge Finance Corporation (PTMN) Q4 2023 Earnings Call Transcript:
Financial Performance:
Portman Ridge Finance Corporation reported a 10% increase in total investment income and a 16% increase in core investment income year-over-year.
Net asset value per share rose from $22.65 to $22.76 quarter-over-quarter.
Improvement in credit quality was observed, with a reduction in non-accruals.
They continued the successful share repurchase program, buying back 101,680 shares for an average cost of $1.8 million in Q4.
The Q1 2024 dividend payout is $0.69 per share, a 12.1% annualized return on net asset value.
For 2023, total dividends distributed to shareholders were $2.75 per share, a 7.4% increase from 2022.
Total investment income and net investment income for 2023 was significantly higher than the previous year.
Overall expenses for 2023 increased primarily due to an increase in interest and amortization of debt issuance costs.
Business Progress:
Deal activity saw an uptick in Q4, primarily in sponsor finance deals.
The company plans to further diversify its portfolio, with 55% of capital deployed in Q4 towards existing portfolio companies.
They continued their stock buyback program as their stocks were deemed to be undervalued throughout 2023.
They repurchased 224,933 shares for a cost of about $4.4 million in 2023.
The company plans to deliver strong returns to shareholders in 2024 by utilizing a proven investment strategy.
A significant increase in the debt securities portfolio was observed resulting in increased interest income.
They predict an incremental income gain if their assets were to reset to a three-month SOFR rate.
The new investments made during Q4 are expected to yield a spread to SOFR of 798 basis points on par value.
The investment portfolio at the end of Q4 2023 remained highly diversified across various industries.
They plan to maintain their target leverage range and prudent investing in the upcoming year despite an attractive investment environment with wide spreads and high SOFR.
More details: Portman Ridge Finance Corp IR
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