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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