In This Article:
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Net Investment Income: $0.44 per share for Q4 2024, flat year-over-year, down from $0.45 in Q3 2024.
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Quarterly Dividend: $0.41 per share, covered by net investment income.
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Net Asset Value (NAV): Increased to $18.20 per share from $18.09 a year ago.
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Total Portfolio: $3.1 billion at year-end, with 96.4% in first lien senior secured loans.
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Portfolio Yield: 12.1%, up from 11.8% in the prior quarter.
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New Investments: $338 million originated in Q4 2024.
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Repayments: $442 million received in Q4 2024.
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Debt Outstanding: Approximately $1 billion with a net debt to equity ratio of 1.03 times.
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Unsecured Debt: $444 million as of December 31, 2024.
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Gross Investment Income: $55.6 million for Q4 2024.
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Net Expenses: $31.8 million for Q4 2024.
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Net Increase in Net Assets: $22.6 million for Q4 2024.
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Available Capital: Over $900 million as of December 31, 2024.
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Non-Accruals: Only one investment on non-accrual, representing 0.6% of the portfolio at cost.
Release Date: February 26, 2025
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
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SLR Investment Corp (NASDAQ:SLRC) achieved a net investment income of $0.44 per share for Q4 2024, covering the quarterly dividend of $0.41 per share.
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The company's net asset value increased to $1,820 million from $1,809 million a year ago, indicating strong credit quality.
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SLRC's portfolio yield increased to 12.1% from 11.8% in the prior quarter, reflecting favorable conditions in specialty finance markets.
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The company has over $900 million of available capital to deploy, positioning it well for future opportunities.
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SLRC's focus on first lien senior secured loans, comprising 96.4% of its portfolio, provides a conservative position against inflationary pressures and high interest rates.
Negative Points
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Net investment income per share was flat year-over-year and down a penny from the third quarter.
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The sponsor finance market remains challenging with tight spreads and competitive conditions, leading to a decline in cash flow loan yields.
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SLRC experienced $442 million in repayments in Q4, which exceeded new investments of $338 million, resulting in a net decrease in the portfolio size.
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The company has only one investment on non-accrual, but it represents 0.6% of the portfolio on a cost basis.
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The equipment finance sector faces yield volatility due to the mismatch between fixed-rate loans and floating-rate liabilities.
Q & A Highlights
Q: Can you discuss the opportunities for acquiring portfolios or teams in your specialty finance verticals? A: Bruce Spohler, Co-CEO, explained that while they saw opportunities last year, they passed on some due to credit underwriting concerns. They have a dedicated team for sourcing portfolios and teams, and post-regional banking disruptions, they have seen increased activity in specialty finance. However, they remain selective, often preferring organic growth over acquisitions.