Gladstone Investment Corporation Reports Financial Results for its First Quarter Ended June 30, 2024
Rhea-AI Summary
Gladstone Investment (Nasdaq:GAIN) reported financial results for its first fiscal quarter ended June 30, 2024. Key highlights include:
- Total investment income decreased 6.2% to $22.2 million
- Net investment income increased 133.2% to $12.4 million ($0.34 per share)
- Net assets decreased 3.1% to $477.4 million ($13.01 per share)
- Paid $0.24 per share in distributions to common stockholders
- Weighted-average yield on interest-bearing investments increased to 14.5%
The company experienced a net decrease in net assets resulting from operations of $6.5 million, primarily due to $18.9 million of net unrealized depreciation on investments. Total expenses decreased 46.7%, mainly due to lower capital gains-based incentive fees. The Board declared monthly distributions of $0.08 per share for July, August, and September 2024.
Positive
- Net investment income increased 133.2% to $12.4 million ($0.34 per share)
- Weighted-average yield on interest-bearing investments increased to 14.5%
- Total expenses decreased 46.7% due to lower capital gains-based incentive fees
- Invested an additional $18.5 million in Nocturne Luxury Villas, Inc. in July 2024
Negative
- Total investment income decreased 6.2% to $22.2 million
- Net assets decreased 3.1% to $477.4 million ($13.01 per share)
- Experienced a net decrease in net assets resulting from operations of $6.5 million
- $18.9 million of net unrealized depreciation on investments
- Certain loans to portfolio companies placed on non-accrual status during the quarter
Insights
Gladstone Investment 's Q1 FY2025 results show mixed performance. Net investment income increased significantly to
The company's total investment income decreased by
While the increased net investment income is positive, the overall decrease in net assets and NAV suggests challenges in the portfolio's performance. Investors should monitor the non-accrual loans and unrealized depreciation trends in future quarters.
The Q1 results reveal some concerning trends in Gladstone's portfolio. The decrease in total investments by
The significant unrealized depreciation of
On a positive note, the company maintained its quarterly distribution of
MCLEAN, VA / ACCESSWIRE / August 5, 2024 / Gladstone Investment Corporation (Nasdaq:GAIN) (the "Company") today announced earnings for its first fiscal quarter ended June 30, 2024. Please read the Company's Quarterly Report on Form 10-Q, filed today with the U.S. Securities and Exchange Commission (the "SEC"), which is available on the SEC's website at www.sec.gov or the investors section of the Company's website at www.gladstoneinvestment.com.
Summary Information: (dollars in thousands, except per share data (unaudited)):
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| June 30, |
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| March 31, |
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| $ Change |
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| % Change |
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For the quarter ended: |
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Total investment income |
| $ | 22,178 |
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| $ | 23,648 |
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| $ | (1,470 | ) |
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| (6.2)% |
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Total expenses, net(A) |
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| 9,764 |
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| 18,325 |
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| (8,561 | ) |
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| (46.7)% |
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Net investment income(A) |
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| 12,414 |
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| 5,323 |
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| 7,091 |
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Net realized gain |
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| 2 |
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| (14,650 | ) |
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| 14,652 |
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| NM |
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Net unrealized (depreciation) appreciation |
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| (18,942 | ) |
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| 31,911 |
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| (50,853 | ) |
| NM |
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Net (decrease) increase in net assets resulting from operations(A) |
| $ | (6,526 | ) |
| $ | 22,584 |
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| $ | (29,110 | ) |
| NM |
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Net investment income per weighted-average common share(A) |
| $ | 0.34 |
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| $ | 0.15 |
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| $ | 0.19 |
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Adjusted net investment income per weighted-average common share(B) |
| $ | 0.24 |
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| $ | 0.24 |
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| $ | - |
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| -% |
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Net (decrease) increase in net assets resulting from operations per weighted-average common share(A) |
| $ | (0.18 | ) |
| $ | 0.63 |
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| $ | (0.81 | ) |
| NM |
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Cash distribution per common share from net investment income |
| $ | 0.24 |
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| $ | 0.24 |
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| $ | - |
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| -% |
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Weighted-average yield on interest-bearing investments |
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| 14.5 | % |
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| 14.3 | % |
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| 0.2 | % |
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Total dollars invested |
| $ | 598 |
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| $ | 936 |
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| $ | (338 | ) |
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| (36.1)% |
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Total dollars repaid and collected from sales and recapitalization of investments |
| $ | 3,024 |
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| $ | 500 |
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| $ | 2,524 |
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Weighted-average shares of common stock outstanding - basic and diluted |
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| 36,688,667 |
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| 36,114,984 |
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| 573,683 |
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Total shares of common stock outstanding |
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| 36,688,667 |
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| 36,688,667 |
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| - |
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| -% |
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As of: |
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Total investments, at fair value |
| $ | 899,138 |
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| $ | 920,504 |
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| $ | (21,366 | ) |
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| (2.3)% |
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Fair value, as a percent of cost |
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| 105.5 | % |
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| 107.8 | % |
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| (2.3 | )% |
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| (2.1)% |
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Net assets |
| $ | 477,380 |
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| $ | 492,711 |
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| $ | (15,331 | ) |
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| (3.1)% |
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Net asset value per common share |
| $ | 13.01 |
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| $ | 13.43 |
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| $ | (0.42 | ) |
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| (3.1)% |
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Number of portfolio companies |
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| 23 |
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| 24 |
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| (1 | ) |
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| (4.2)% |
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NM = Not Meaningful
(A) |
| Inclusive of |
(B) |
| See Non-GAAP Financial Measure - Adjusted Net Investment Income, below, for a description of this non-GAAP measure and a reconciliation from Net investment income to Adjusted net investment income, including on a weighted-average per share basis. The Company uses this non-GAAP financial measure internally in analyzing financial results and believes it is useful to investors as an additional tool to evaluate ongoing results and trends for the Company. |
Highlights for the Quarter: During the quarter ended June 30, 2024, the following significant events occurred:
Portfolio Activity:
In May 2024, our remaining shares in Funko Acquisition Holdings, LLC ("Funko") were sold, representing an exit of our investment in Funko, and resulting in a return of our equity cost basis of
$21 thousand and a realized gain of$2 thousand .
Distributions and Dividends:
Paid an
$0.08 per common share distribution to common stockholders in each of April, May and June 2024.
First Quarter Results: Net investment income for the quarter ended June 30, 2024 was
Total investment income for the quarters ended June 30, 2024 and March 31, 2024 was
Total expenses, net of credits, for the quarters ended June 30, 2024 and March 31, 2024 was
Net asset value per common share as of June 30, 2024 was
Subsequent Events: After June 30, 2024, the following significant events occurred:
Distributions and Dividends: In July 2024, our Board of Directors declared the following monthly and supplemental distributions to common stockholders.
Record Date |
| Payment Date |
| Distribution per Common Share | |
July 22, 2024 |
| July 31, 2024 |
| $ | 0.08 |
August 21, 2024 |
| August 30, 2024 |
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| 0.08 |
September 20, 2024 |
| September 30, 2024 |
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| 0.08 |
| Total for the Quarter: |
| $ | 0.24 | |
Significant Investment Activity:
In July 2024, we invested an additional
$18.5 million through secured first lien debt in Nocturne Luxury Villas, Inc. to fund an add-on acquisition.
Non-GAAP Financial Measure - Adjusted Net Investment Income: On a supplemental basis, the Company discloses Adjusted net investment income, including on a weighted-average per share basis, which is a financial measure that is calculated and presented on a basis of methodology other than in accordance with GAAP. Adjusted net investment income represents net investment income, excluding capital gains-based incentive fees. The Company uses this non-GAAP financial measure internally in analyzing financial results and believes that this non-GAAP financial measure is useful to investors as an additional tool to evaluate ongoing results and trends for the Company. The Company's investment advisory agreement provides that a capital gains-based incentive fee is determined and paid annually with respect to realized capital gains (but not unrealized appreciation) to the extent such realized capital gains exceed realized capital losses and unrealized depreciation on investments for such year. However, under GAAP, a capital gains-based incentive fee is accrued if realized capital gains and unrealized appreciation of investments exceed realized capital losses and unrealized depreciation of investments. Refer to Note 4 - Related Party Transactions in our Quarterly Report on Form 10-Q for further discussion. The Company believes that Adjusted net investment income is a useful indicator of operations exclusive of any capital gains-based incentive fees, as net investment income does not include realized or unrealized investment activity associated with the capital gains-based incentive fee.
The following table provides a reconciliation of net investment income (the most comparable GAAP measure) to Adjusted net investment income for the periods presented (dollars in thousands, except per share amounts; unaudited):
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| For the quarter ended | |||||||||||||
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| June 30, 2024 |
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| March 31, 2024 | ||||||||||
| Amount |
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| Per Share Amount |
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| Amount |
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| Per Share Amount | |||||
Net investment income |
| $ | 12,414 |
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| $ | 0.34 |
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| $ | 5,323 |
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| $ | 0.15 |
Capital gains-based incentive fee |
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| (3,788 | ) |
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| (0.10 | ) |
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| 3,452 |
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| 0.09 |
Adjusted net investment income |
| $ | 8,626 |
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| $ | 0.24 |
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| $ | 8,775 |
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| $ | 0.24 |
Weighted-average shares of common stock outstanding - basic and diluted |
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| 36,688,667 |
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| 36,114,984 |
Adjusted net investment income may not be comparable to similar measures presented by other companies, as it is a non-GAAP financial measure that is not based on a comprehensive set of accounting rules or principles and therefore may be defined differently by other companies. In addition, Adjusted net investment income should be considered in addition to, not as a substitute for, or superior to, financial measures determined in accordance with GAAP.
Conference Call: The Company will hold its earnings release conference call on Tuesday, August 6, 2024, at 8:30 a.m. Eastern Time. Please call (866) 424-3437 to enter the conference call. An operator will monitor the call and set a queue for any questions. A replay of the conference call will be available through August 13, 2024. To hear the replay, please dial (877) 660-6853 and use the playback conference number 13746755. The replay will be available beginning approximately one hour after the call concludes. The live audio broadcast of the Company's quarterly conference call will also be available online at www.gladstoneinvestment.com. The event will be archived and available for replay on the Company's website.
About Gladstone Investment Corporation: Gladstone Investment Corporation is a publicly traded business development company that seeks to make secured debt and equity investments in lower middle market businesses in the United States in connection with acquisitions, changes in control and recapitalizations. Information on the business activities of all the Gladstone funds can be found at www.gladstonecompanies.com.
To obtain a paper copy of our Quarterly Report on Form 10-Q, filed today with the SEC, please contact the Company at 1521 Westbranch Drive, Suite 100, McLean, VA 22102, ATTN: Investor Relations. The financial information above is not comprehensive and is without notes, so readers should obtain and carefully review the Company's Form 10-Q for the quarter ended June 30, 2024, including the notes to the consolidated financial statements contained therein.
Investor Relations Inquiries: Please visit ir.gladstoneinvestment.com or call (703) 287-5893.
SOURCE: Gladstone Investment Corporation
Forward-looking Statements:
The statements in this press release regarding potential future distributions, earnings and operations of the Company are "forward-looking statements." These forward-looking statements inherently involve certain risks and uncertainties in predicting future results and conditions. Although these statements are based on the Company's current plans that are believed to be reasonable as of the date of this press release, a number of factors could cause actual results and conditions to differ materially from these forward-looking statements, including those factors described from time to time in the Company's filings with the Securities and Exchange Commission. The Company undertakes no obligation to publicly release the result of any revisions to these forward-looking statements that may be made to reflect any future events or otherwise, except as required by law.
SOURCE: Gladstone Investment CorporationView the original press release on accesswire.com
FAQ
What was Gladstone Investment 's (GAIN) net investment income for Q1 2024?
How much did Gladstone Investment (GAIN) pay in distributions for Q1 2024?
What was the change in Gladstone Investment 's (GAIN) net asset value as of June 30, 2024?
Did Gladstone Investment (GAIN) make any significant investments after June 30, 2024?
