The following is a summary of the Stellus Capital Investment Corporation (SCM) Q4 2023 Earnings Call Transcript:

Financial Performance:

• Stellus Capital Investment Corporation reported core net investment income of $0.50 per share and GAAP net investment income of $0.49 per share, covering their $0.40 per share dividend for Q4.

• The net asset value increased $0.07 per share to $13.26 per share.

• The company recorded a tax refund of $3 million due to a previously marked down position.

• Since their IPO, they've invested approximately $2.4 billion in over 195 companies and received approximately $1.5 billion of repayments.

• At the end of Q4, the investment portfolio at fair value was $874 million across 93 portfolio companies.

• The company had 4 loans on non-accrual, which comprised 1.3% of the fair value of the total loan portfolio.

Business Progress:

• Stellus invested $40.3 million in 3 new and 11 existing portfolio companies during Q4, while receiving 5 full repayments and 4 full realizations, totaling $39.9 million.

• The company expects two equity realizations in the upcoming quarter with aggregate proceeds approximated at $7 million and a potential realized gain of $4 million.

• Post year-end, Stellus funded $4.7 million at par in 7 existing portfolio companies and had 1 full repayment of $16.2 million.

• Expectations are for a pick up in the slower environment for originations in the second half of the year.

• The company is preparing for a third SBA license as the first license debentures are due and the second license investment period ends soon.

• An anticipated increase in acquisitions by portfolio companies and their owners is reported as part of their growth strategy.

More details: Stellus Capital Investment IR

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