The following is a summary of the OFS Capital (OFS) Q1 2024 Earnings Call Transcript:
Financial Performance:
OFS Capital reported Q1 net investment income of $0.42 per share, a 20% rise from the previous quarter.
Total investment income for Q1 was $14.2 million, primarily due to a non-recurring increase in dividend income.
The net asset value declined to $11.08 per share, primarily due to unrealized depreciation in Pfanstiehl Holdings equity investment.
The company paid off its remaining $31.9 million in SBIC debt in entirety.
The outstanding debt, which matures in 2026 or later, is largely unsecured, making up 70% of it.
Business Progress:
The company added one borrower to non-accrual status this quarter, representing about 2% of the portfolio at fair value.
OFS Capital's strategy involves shying away from highly cyclical industries and focusing on higher positions in the capital structure.
Despite the uncertain macroeconomic environment, the loan portfolio remains robust.
Anticipating an increase in M&A activity, the company supports existing portfolio businesses and has committed to funding investments under various credit facilities.
New investments were made during Q1, including a new middle market investment, bringing the total investment to $400.4 million across 74 issuers by the end of the quarter.
More details: OFS Capital IR
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