Saratoga Investment Corp. Announces Quarterly Dividend of $0.74 Per Share for the Fiscal Third Quarter Ending November 30, 2024

Rhea-AI Summary

Saratoga Investment (NYSE:SAR) has declared a base quarterly dividend of $0.74 per share for Q3 FY2025 ending November 30, 2024, plus a special dividend of $0.35 per share, totaling $1.09 per share. Both dividends are payable December 19, 2024, to stockholders of record by December 4, 2024. The base dividend equals the company's highest historical rate, offering a 12.7% annualized yield based on the $23.31 stock price on November 5, 2024. The special dividend fulfills fiscal 2024 spillover requirements, with new spillover accumulation starting March 1, 2024.

Positive

• Maintained highest-ever quarterly base dividend of $0.74 per share
• Additional special dividend of $0.35 per share announced
• Strong 12.7% annualized dividend yield
• Portfolio showing strong overall performance in Q2 and Q3
• Industry-leading dividend coverage maintained

Negative

• Potential risk from future interest rate cuts mentioned

Insights

Financial Analyst

The announcement of a $0.74 base quarterly dividend plus a $0.35 special dividend represents significant value for investors. The total distribution of $1.09 per share delivers an impressive 12.7% annualized yield. The company's ability to maintain its highest-ever base dividend while providing additional special distributions demonstrates robust portfolio performance and strong earnings generation.

The dividend coverage and yield metrics remain industry-leading, suggesting sustainable distribution levels. The early fulfillment of fiscal 2024 spillover requirements indicates strong excess earnings, while the company's diverse funding sources, including two SBIC licenses, $600M CLO fund and joint venture arrangements, provide multiple revenue streams to support future distributions. The strategic timing of the special dividend also creates a clean slate for new spillover accumulation from March 2024.

Also Announces Special Dividend of $0.35 Per Share Fulfilling our Fiscal 2024 Distribution Requirements

Total Distributions in the Fiscal Third Quarter Amount to $1.09 Per Share

NEW YORK, Nov. 07, 2024 (GLOBE NEWSWIRE) -- Saratoga Investment Corp. (NYSE:SAR) (“Saratoga Investment” or “the Company”), a business development company, today announced that its Board of Directors has declared a base quarterly dividend of $0.74 per share for the fiscal third quarter ending November 30, 2024, and an additional special dividend of $0.35 per share fulfilling our fiscal 2024 distribution requirements. Both dividends are payable on December 19, 2024, to all stockholders of record at the close of business on December 4, 2024. 

“As a result of the strong overall performance of our portfolio during the fiscal second and third quarters, the board of directors approved a dividend of $0.74 per share, equivalent to the highest in our history, while maintaining industry leading dividend coverage and yield. Annualizing this dividend rate implies a 12.7% dividend yield based on Saratoga’s recent stock price of $23.31 per share on November 5, 2024” said Christian L. Oberbeck, Chairman and Chief Executive Officer of Saratoga Investment. 

Mr. Oberbeck continued, “Additionally, we are pleased to declare an additional special distribution of $0.35 per share, which was driven by the substantial overearning of our dividend during the previous fiscal year. By distributing this dividend at this stage, we have fulfilled our fiscal 2024 spillover requirements, with new spillover starting to build commencing March 1, 2024, generated from our quarterly earnings. We believe the diligent execution of our strategy, and the highly diversified nature and solid performance of our portfolio has allowed us to continue delivering attractive returns to our shareholders via solid and consistent base dividends, further enhanced with this special distribution. This dividend strategy provides a cushion against potential adverse events, including the possible effects of further cuts in interest rates.”

This is the third dividend declared in fiscal year 2025. 

Historical Dividend Distributions

Period (Fiscal Year ends Feb 28)		Base Dividend Per Share		Special Dividend Per Share		Total Dividend Per Share
Fiscal Q3 2025		$0.74		$0.35		$1.09
Fiscal Q2 2025		$0.74		-		$0.74
Fiscal Q1 2025		$0.74		-		$0.74
Year-to-Date Fiscal 2025 (including pending dividend)		$2.22		$0.35		$2.57
Fiscal Q4 2024		$0.73		-		$0.73
Fiscal Q3 2024		$0.72		-		$0.72
Fiscal Q2 2024		$0.71		-		$0.71
Fiscal Q1 2023		$0.70		-		$0.70
Full Year Fiscal 2024		$2.86		-		$2.86
Fiscal Q4 2023		$0.69		-		$0.69
Fiscal Q3 2023		$0.68		-		$0.68
Fiscal Q2 2023		$0.54		-		$0.54
Fiscal Q1 2023		$0.53		-		$0.53
Full Year Fiscal 2023		$2.44		-		$2.44

Shareholders will have the option to receive payment of the dividend in cash or receive shares of common stock pursuant to the Company’s dividend reinvestment plan (“DRIP”). Saratoga Investment shareholders who hold their shares with a broker must affirmatively instruct their brokers prior to the record date if they prefer to receive this dividend, and future dividends, in common stock.  The number of shares of common stock to be delivered shall be determined by dividing the total dollar amount by 95% of the average of the market prices per share at the close of trading on the ten (10) trading days immediately preceding (and including) the payment date.

About Saratoga Investment 

Saratoga Investment is a specialty finance company that provides customized financing solutions to U.S. middle-market businesses. The Company invests primarily in senior and unitranche leveraged loans and mezzanine debt, and, to a lesser extent, equity to provide financing for change of ownership transactions, strategic acquisitions, recapitalizations and growth initiatives in partnership with business owners, management teams and financial sponsors. Saratoga Investment’s objective is to create attractive risk-adjusted returns by generating current income and long-term capital appreciation from its debt and equity investments. Saratoga Investment has elected to be regulated as a business development company under the Investment Company Act of 1940 and is externally managed by Saratoga Investment Advisors, LLC, an SEC-registered investment advisor focusing on credit-driven strategies. Saratoga Investment Corp. owns two active SBIC-licensed subsidiaries, having surrendered its first license after repaying all debentures for that fund following the end of its investment period and subsequent wind-down. Furthermore, it manages a $600 million collateralized loan obligation (“CLO”) fund and co-manages a joint venture (“JV”) fund that owns a $400 million collateralized loan obligation (“JV CLO”) fund.  It also owns 52% of the Class F and 100% of the subordinated notes of the CLO, 87.5% of both the unsecured loans and membership interests of the JV and 87.5% of the Class E notes of the JV CLO. The Company’s diverse funding sources, combined with a permanent capital base, enable Saratoga Investment to provide a broad range of financing solutions.

Forward Looking Statements

Statements included herein contain certain “forward-looking statements” within the meaning of the federal securities laws, which relate to future events or our future performance or financial condition. Forward-looking statements can be identified by the use of forward looking words such as “outlook,” “believes,” “expects,” “potential,” “continues,” “may,” “will,” “should,” “seeks,” “approximately,” “predicts,” “intends,” “plans,” “estimates,” “anticipates” or negative versions of those words, other comparable words or other statements that do not relate to historical or factual matters. The forward-looking statements are based on our beliefs, assumptions and expectations of future events and our future performance, taking into account all information currently available to us. These statements are not guarantees of future events, performance, condition or results and involve a number of risks and uncertainties. Actual results may differ materially from those in the forward-looking statements as a result of a number of factors, including but not limited to: changes in the markets in which the Company invests; changes in the financial, capital, and lending markets; a rising interest rate environment and its impact on the Company’s business and its portfolio companies; regulatory changes; tax treatments; an economic downturn and its impact on the ability of our portfolio companies to operate and the investment opportunities available to the Company; the impact of supply chain constraints and labor shortages on our portfolio companies; and the elevated levels of inflation and its impact on our portfolio companies and the industries in which we invest; and those described from time to time in our filings with the SEC. Any forward-looking statement speaks only as of the date on which it is made. Saratoga Investment Corp. undertakes no duty to update any forward-looking statements made herein, whether as a result of new information, future developments or otherwise, except as required by law.

Contacts:

Saratoga Investment Corporation
535 Madison Avenue, 4th Floor
New York, NY 10022

Henri Steenkamp
Chief Financial Officer
Saratoga Investment Corp.
212-906-7800
                                                            
Lena Cati
The Equity Group Inc.
212-836-9611 / lcati@equityny.com 

Val Ferraro
The Equity Group Inc.
212-836-9633 / vferraro@equityny.com 

FAQ

What is Saratoga Investment's (SAR) latest dividend announcement for Q3 2025?

Saratoga Investment announced a base quarterly dividend of $0.74 per share plus a special dividend of $0.35 per share, totaling $1.09 per share for Q3 FY2025.

When will SAR's Q3 2025 dividend be paid?

Both the base and special dividends will be paid on December 19, 2024, to stockholders of record as of December 4, 2024.

What is SAR's current dividend yield based on recent stock price?

Based on the stock price of $23.31 on November 5, 2024, the annualized dividend yield is 12.7%.

How much has SAR paid in total dividends for fiscal year 2025 so far?

Including the pending dividend, SAR has declared total dividends of $2.57 per share in fiscal year 2025, comprising $2.22 in base dividends and $0.35 in special dividend.