The following is a summary of the SLR Investment Corp. (SLRC) Q1 2024 Earnings Call Transcript:
Financial Performance:
SLR Investment reported net investment income of $0.44 per share in Q1 2024, marking a year-over-year growth of 7.7%.
The company saw an increase in net asset value per share to $18.19 as of March 31, 2024 from $18.09 per share at December 31, a sequential increase of 0.6%.
The comprehensive investment portfolio slightly declined to $3.1 billion due to $261 million originations and $340 million repayments.
SLR Investment Corp.'s net asset value at the end of March was $992 million, with $1.2 billion of debt outstanding, resulting in a leverage of 1.16x net debt to equity.
Business Progress:
Despite the slow pace of M&A activity and an increase in bank participation, the company was able to find attractive investment opportunities in sponsor finance and specialty finance.
The company's diverse investment strategy encompasses asset-based lending, life sciences lending, and equipment finance.
The firm's portfolio, primarily composed of first lien senior secured loans, showed 0.8% and 0.6% non-accrual investments on cost and fair value basis respectively.
Future growth areas are seen in asset-based loan originations, the life sciences market, and equipment finance sectors.
The diversity of their portfolio provides flexibility in investment decision-making, with approximately $800 million of available capital to deploy as of the end of Q1.
The yield on the overall portfolio increased from 11.6% to 11.8% quarter-over-quarter, driven by increased returns on asset-based loan classes, with no immediate compression in specialty finance verticals anticipated.
The company shows potential for additional 'tuck-ins', mainly within their existing asset-based lending strategies, utilizing their existing infrastructure.
More details: SLR Investment Corp IR
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