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Stellus Capital Investment Corporation Reports Results for its Second Fiscal Quarter Ended June 30, 2024

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Stellus Capital Investment (NYSE:SCM) reported financial results for Q2 2024 ended June 30. Key highlights include:

  • Net investment income of $0.48 per share
  • Core net investment income of $0.50 per share
  • Net asset value of $13.36 per share
  • New investments of $66.3 million
  • Repayments of $40.7 million
  • Declared distributions of $0.40 per share

The loan portfolio yield was 11.7% as of June 30, 2024. SCM completed over 11 years of operations, with investors receiving $262 million in total distributions ($15.75 per share). The company had $169.4 million outstanding under its credit facility as of June 30, 2024.

Stellus Capital Investment (NYSE:SCM) ha riportato i risultati finanziari per il secondo trimestre del 2024 chiuso il 30 giugno. I punti salienti includono:

  • Reddito netto da investimenti di $0.48 per azione
  • Reddito netto da investimenti core di $0.50 per azione
  • Valore netto degli attivi di $13.36 per azione
  • Nuovi investimenti di $66.3 milioni
  • Rimborso di $40.7 milioni
  • Distribuzioni dichiarate di $0.40 per azione

Il rendimento del portafoglio prestiti era dell'11.7% al 30 giugno 2024. SCM ha completato oltre 11 anni di operazioni, con gli investitori che hanno ricevuto $262 milioni in totale distribuzioni ($15.75 per azione). L'azienda aveva $169.4 milioni in sospeso sotto la sua linea di credito al 30 giugno 2024.

Stellus Capital Investment (NYSE:SCM) reportó resultados financieros para el segundo trimestre de 2024 que terminó el 30 de junio. Los aspectos más destacados incluyen:

  • Ingresos netos por inversiones de $0.48 por acción
  • Ingresos netos por inversiones básicas de $0.50 por acción
  • Valor neto de los activos de $13.36 por acción
  • Nuevas inversiones de $66.3 millones
  • Reembolsos de $40.7 millones
  • Distribuciones declaradas de $0.40 por acción

El rendimiento de la cartera de préstamos fue del 11.7% hasta el 30 de junio de 2024. SCM completó más de 11 años de operaciones, con los inversores recibiendo $262 millones en distribuciones totales ($15.75 por acción). La empresa tenía $169.4 millones pendientes bajo su línea de crédito hasta el 30 de junio de 2024.

스텔러스 캐피탈 인베스트먼트 (NYSE:SCM)는 2024년 6월 30일 종료된 2분기 재무 결과를 발표했습니다. 주요 내용은 다음과 같습니다:

  • 주당 순투자수익 $0.48
  • 주당 핵심 순투자수익 $0.50
  • 주당 순자산가치 $13.36
  • 신규 투자 $66.3 백만
  • 상환 $40.7 백만
  • 선언된 배당금 주당 $0.40

대출 포트폴리오 수익률은 2024년 6월 30일 기준 11.7%였습니다. SCM은 11년 이상의 운영을 마치고 투자자들에게 총 $262 백만 ($15.75 주당)의 배당금을 지급했습니다. 회사는 2024년 6월 30일 기준으로 신용 한도 아래에 $169.4 백만이 미결제 상태였습니다.

Stellus Capital Investment (NYSE:SCM) a publié ses résultats financiers pour le deuxième trimestre 2024 clos le 30 juin. Les points clés incluent:

  • Revenu net d'investissement de 0,48 $ par action
  • Revenu net d'investissement de base de 0,50 $ par action
  • Valeur nette des actifs de 13,36 $ par action
  • Nouveaux investissements de 66,3 millions $
  • Remboursements de 40,7 millions $
  • Distributions déclarées de 0,40 $ par action

Le rendement du portefeuille de prêts était de 11,7 % au 30 juin 2024. SCM a complété plus de 11 ans d'opérations, avec des investisseurs recevant 262 millions $ en distributions totales (15,75 $ par action). L'entreprise avait 169,4 millions $ en suspens sous sa ligne de crédit au 30 juin 2024.

Stellus Capital Investment (NYSE:SCM) hat die finanziellen Ergebnisse für das zweite Quartal 2024, das am 30. Juni endete, bekannt gegeben. Die wichtigsten Punkte sind:

  • Nettoinvestitionseinkommen von $0,48 pro Aktie
  • Kern-Nettoinvestitionseinkommen von $0,50 pro Aktie
  • Nettovermögen von $13,36 pro Aktie
  • Neue Investitionen von $66,3 Millionen
  • Rückzahlungen von $40,7 Millionen
  • Erklärte Ausschüttungen von $0,40 pro Aktie

Die Rendite des Kreditportfolios betrug zum 30. Juni 2024 11,7%. SCM hat über 11 Jahre Betrieb abgeschlossen, wobei die Investoren insgesamt $262 Millionen an Ausschüttungen ($15,75 pro Aktie) erhalten haben. Das Unternehmen hatte zum 30. Juni 2024 $169,4 Millionen ausstehend unter seiner Kreditlinie.

Positive
  • Net investment income of $0.48 per share and core net investment income of $0.50 per share covered the $0.40 per share dividend
  • New investments of $66.3 million exceeded repayments of $40.7 million, indicating portfolio growth
  • Loan portfolio yield of 11.7% as of June 30, 2024
  • Net asset value increased to $13.36 per share from $13.26 at year-end 2023
Negative
  • Net investment income per share decreased slightly from $0.49 in Q2 2023 to $0.48 in Q2 2024
  • Core net investment income per share decreased from $0.51 in Q2 2023 to $0.50 in Q2 2024
  • Total weighted average yield on investments decreased from 11.1% at year-end 2023 to 10.9% as of June 30, 2024

Insights

Stellus Capital Investment 's Q2 2024 results show solid performance with some positive indicators:

  • Core net investment income of $0.50 per share exceeded the $0.40 regular dividend, indicating good dividend coverage.
  • Net asset value increased slightly to $13.36 per share from $13.26 at year-end 2023.
  • The loan portfolio yield remains healthy at 11.7%, supporting income generation.

However, there are some potential concerns:

  • Net investment income per share declined slightly year-over-year from $0.49 to $0.48.
  • Unrealized depreciation of $5.58 million on investments may indicate some portfolio stress.

Overall, Stellus appears to be managing well in a challenging environment, but investors should monitor portfolio quality and yield trends closely.

Stellus' investment activity in Q2 2024 demonstrates a proactive approach to portfolio management:

  • New investments of $66.3 million outpaced repayments of $40.7 million, indicating net portfolio growth.
  • The number of portfolio companies increased from 93 to 100, suggesting improved diversification.
  • Several new investments were made across various industries, including specialty coffee, landscaping services and robotics, showing sector diversification.

However, the slight decrease in weighted average yield on total investments from 11.1% to 10.9% warrants attention. This could be due to competitive pressures or a shift towards lower-risk investments. The company's ability to maintain yield while growing the portfolio will be important for future performance.

Stellus' capital management strategy shows prudent leveraging and liquidity management:

  • The company increased its credit facility utilization to $169.4 million, up from $160.1 million at year-end, supporting portfolio growth.
  • Successful issuance of 1,855,356 shares through the ATM program, raising $25.8 million at an average price of $13.89 per share, which was above NAV.
  • Maintained a stable distribution of $0.40 per share for the quarter.

The ability to raise equity capital above NAV is a positive sign, indicating market confidence. However, investors should monitor the balance between equity issuance and leverage to ensure optimal capital structure. The company's capacity to access both debt and equity markets provides flexibility for future growth opportunities.

HOUSTON, Aug. 7, 2024 /PRNewswire/ -- Stellus Capital Investment Corporation (NYSE:SCM) ("Stellus" or the "Company") today announced financial results for its second fiscal quarter ended June 30, 2024.

Robert T. Ladd, Chief Executive Officer of Stellus, stated, "I am pleased to report solid operating results for the quarter ended June 30, 2024, in which U.S. GAAP net investment income of $0.48 per share and core net investment income of $0.50 per share covered the regular dividend declared of $0.40 per share. Our loan portfolio is yielding 11.7%, as of June 30, 2024. We have completed over eleven years of operations, during which our investors have received a total of $262 million in distributions, equivalent to $15.75 per share."

 

FINANCIAL HIGHLIGHTS

($ in millions, except data relating to per share amounts and shares outstanding)














Three Months Ended


Six Months Ended


June 30, 2024


June 30, 2023


June 30, 2024


June 30, 2023


Amount

Per Share


Amount

Per Share


Amount

Per Share


Amount

Per Share

Net investment income

$11.79

$0.48


$10.41

$0.49


$22.03

$0.90


$19.48

$0.95

Core net investment income(1)

12.37

0.50


10.79

0.51


22.97

0.94


19.66

0.96

Net realized gain (loss) on investments

1.99

0.07


(0.31)

(0.01)


(18.39)

(0.75)


(0.28)

(0.02)

Net realized loss on foreign currency translation

(0.03)


(0.01)


(0.05)


(0.05)

Total realized income(2)

$13.75

$0.55


$10.09

$0.48


$3.59

$0.15


$19.15

$0.93

Distributions

(10.05)

(0.41)


(8.66)

(0.41)


(19.70)

(0.81)


(16.61)

(0.81)

Net unrealized change in (depreciation) appreciation on investments

(5.58)

(0.22)


(6.30)

(0.31)


17.92

0.73


(10.54)

(0.51)

Net unrealized change in depreciation on foreign currency translation

(0.01)


(0.01)


(0.01)


(0.02)

Benefit (provision) for taxes on unrealized depreciation (appreciation) on investments in taxable subsidiaries

0.38

0.02


(0.07)


0.19

0.01


(0.14)

(0.01)

Net increase in net assets resulting from operations

$8.54

$0.35


$3.71

$0.17


$21.69

$0.89


$8.45

$0.41

Weighted average shares outstanding


24,733,966



21,231,979



24,429,804



20,509,995

                                                               

(1)

Core net investment income, as presented, excludes the impact of capital gains incentive fees (reversal) and income taxes, the majority of which are excise taxes. The Company believes presenting core net investment income and the related per share amount is a useful supplemental disclosure for analyzing its financial performance. However, core net investment income is a non-U.S. generally accepted accounting principles ("U.S. GAAP") measure and should not be considered as a replacement for net investment income and other earnings measures presented in accordance with U.S. GAAP. A reconciliation of net investment income in accordance with U.S. GAAP to core net investment income is presented in the table below the financial statements.                               

(2)

Total realized income is the sum of net investment income, net realized gains (losses) on investments, net realized gains (losses) on foreign currency, and loss on debt extinguishment; all U.S. GAAP measures.

 

PORTFOLIO ACTIVITY

($ in millions, except data relating to per share amounts and number of portfolio companies)












As of


As of







June 30, 2024


December 31, 2023





Investments at fair value


$899.7


$874.5





Total assets


$946.5


$908.1





Net assets


$347.2


$319.9





Shares outstanding


25,980,998


24,125,642





Net asset value per share


$13.36


$13.26
















Three Months Ended


Six Months Ended



June 30, 2024


June 30, 2023


June 30, 2024


June 30, 2023

New investments


$66.3


$46.5


$94.9


$87.7

Repayments of investments


(40.7)


(38.4)


(71.8)


(44.3)

Net activity


$25.6


$8.1


$23.1


$43.4












As of


As of







June 30, 2024


December 31, 2023





Number of portfolio company investments


100


93





Number of debt investments


87


81














Weighted average yield of debt and other income producing investments (3)









Cash


11.0 %


11.0 %





Payment-in-kind ("PIK")


0.3 %


0.5 %





Fee amortization


0.4 %


0.4 %





Total


11.7 %


11.9 %














Weighted average yield on total investments (4)









Cash


10.2 %


10.3 %





Payment-in-kind ("PIK")


0.3 %


0.5 %





Fee amortization


0.4 %


0.3 %





Total


10.9 %


11.1 %





 

(3)

The dollar-weighted average annualized effective yield is computed using the effective interest rate for our debt investments and other income producing investments, including cash and PIK interest, as well as the accretion of deferred fees. The individual investment yields are then weighted by the respective cost of the investments (as of the date presented) in calculating the weighted average effective yield of the portfolio. The dollar-weighted average annualized yield on the Company's investments for a given period will generally be higher than what investors in the Company's common stock would realize in a return over the same period because the dollar-weighted average annualized yield does not reflect the Company's expenses or any sales load that may be paid by investors.

(4)

The dollar-weighted average yield on total investments takes the same yields as calculated in the footnote above but weights them to determine the weighted average effective yield as a percentage of the Company's total investments, including non-income producing loans and equity.

 

Results of Operations

Investment income for both the three months ended June 30, 2024 and 2023 totaled $26.6 million most of which was interest income from portfolio investments.

Gross operating expenses for the three months ended June 30, 2024 and 2023, totaled $16.5 million and $16.2 million, respectively. The increase was driven primarily by increased income tax expense. For the same respective periods, base management fees totaled $3.9 million for both periods, income incentive fees totaled $2.5 million and $2.6 million, fees and expenses related to our borrowings totaled $8.1 million for both periods (including interest and amortization of deferred financing costs), administrative expenses totaled $0.5 million for both periods, income tax totaled $0.6 million and $0.4 million and other expenses totaled $0.9 million and $0.8 million. For the three months ended June 30, 2024, the Company waived income incentive fees totaling $1.6 million for net operating expenses of $14.8 million. No such income incentive fees were waived for the three months ended June 30, 2023.

Net investment income was $11.8 million and $10.4 million, or $0.48 and $0.49 per common share based on weighted average common shares outstanding of 24,733,966 and 21,231,979 for the three months ended June 30, 2024 and 2023, respectively. Core net investment income, which is a non-U.S. GAAP measure that excludes the capital gains incentive fee (reversal) and income tax expense accruals, for the three months ended June 30, 2024 and 2023 was $12.4 million and $10.8 million, or $0.50 and $0.51 per share, respectively.

For the three months ended June 30, 2024 and 2023, the Company's investment portfolio had a net change in unrealized depreciation of $5.6 million and $6.3 million, respectively, and the Company had net realized gains (losses) of $2.0 million and ($0.3) million, respectively.

Net increase in net assets resulting from operations totaled $8.5 million and $3.7 million, or $0.35 and $0.17 per common share, based on weighted average common shares outstanding of 24,733,966 and 21,231,979 for the three months ended June 30, 2024 and 2023, respectively.

Liquidity and Capital Resources

As of June 30, 2024, the Company's amended senior secured revolving credit agreement with certain bank lenders and Zions Bancorporation, N.A. dba Amegy Bank, as administrative agent (as amended from time to time, the "Credit Facility") provided for borrowings in an aggregate amount of up to $260.0 million on a committed basis. As of June 30, 2024 and December 31, 2023, the Credit Facility had an accordion feature which allowed for potential future expansion of the facility size up to $350.0 million.

As of June 30, 2024 and December 31, 2023, the Company had $169.4 million and $160.1 million in outstanding borrowings under the Credit Facility, respectively.

The Company issued 1,855,356 shares during the three months ended June 30, 2024 under the At-the-Market  Program ("ATM Program"), for gross proceeds of $25.8 million. The average per share offering price of shares issued under the ATM Program during the three months ended June 30, 2024 was $13.89. Stellus Capital Management, LLC, the Company's investment adviser (the "Advisor"), agreed to reimburse the Company for underwriting fees to the extent the per share price of the shares to the public, less underwriting fees, was less then net asset value per share. For the three and six months ended June 30, 2024, the Advisor was not required to reimburse underwriting fees as all shares were issued at a premium to net asset value.

Distributions

During the three months ended June 30, 2024 and 2023, the Company declared aggregate distributions of $0.40 per share for both periods ($10.0 million and $8.7 million in the aggregate, respectively). Tax characteristics of all distributions will be reported to stockholders on Form 1099-DIV after the end of the calendar year. None of these dividends are expected to include a return of capital.

Recent Portfolio Activity

The Company invested in the following portfolio companies during the three months ended June 30, 2024:













Activity Type


Date


Company Name


Company Description


Investment Amount


 Instrument Type

New Investment


April 1, 2024


FairWave Holdings, LLC


Specialty coffee platform


$

7,615,265


Senior Secured – First Lien









$

2,665,343


Delayed Draw Term Loan Commitment









$

1,142,290


Revolver Commitment









$

285,572


Equity

New Investment


April 11, 2024


WER Holdings, LLC


Regional provider of commercial landscaping services


$

2,704,164


Senior Secured – First Lien









$

1,338,695


Delayed Draw Term Loan Commitment









$

401,609


Revolver Commitment









$

180,300


Equity

Add-On Investment               


April 16, 2024


Impact Home Services LLC*


Residential garage door, electrical, and plumbing services provider


$

8,932


Equity

Add-On Investment               


April 22, 2024


Exacta Land Surveyors, LLC*


Provider of land survey and field management services to facilitate real estate transactions


$

90,773


Unsecured









$

2,164


Equity

New Investment


May 10, 2024


Luxium Solutions, LLC


Manufacturer and distributor of high-performance advanced materials and assemblies


$

8,293,730


Senior Secured – First Lien









$

1,200,250


Delayed Draw Term Loan Commitment

Add-On Investment               


May 16, 2024


Impact Home Services LLC*


Residential garage door, electrical, and plumbing services provider


$

4,466


Equity

New Investment


May 24, 2024


Teckrez, LLC


Distributor of tackifier resins and acrylic monomers


$

4,315,846


Senior Secured – First Lien









$

1,442,221


Revolver Commitment









$

90,139


Equity

Add-On Investment               


May 24, 2024


ADS Group Opco, LLC*


Designer and supplier of impulse products and merchandising
solutions to retailers.


$

90,582


Equity

New Investment


May 28, 2024


FiscalNote Boards LLC*


Facilitator of executive-level in-person events and remote peer-to-peer industry insights 


$

190,382


Equity

New Investment


May 31, 2024


TriplePoint MEP Holdings, LLC


Provider of HVAC, plumbing, and other mechanical and industrial services


$

5,356,491


Senior Secured – First Lien









$

1,339,123


Delayed Draw Term Loan Commitment









$

743,957


Revolver Commitment









$

557,968


Equity

New Investment


June 6, 2024


Monarch Behavioral Therapy, LLC


Provider of center-based applied behavioral analysis therapy
services


$

6,764,635


Senior Secured – First Lien









$

1,084,076


Delayed Draw Term Loan Commitment









$

722,717


Revolver Commitment









$

428,571


Equity

Add-On Investment               


June 6, 2024


Infolinks Media Buyco, LLC*


Advertising placement partner for small to mid-sized publishers


$

2,558,672


Senior Secured – First Lien

Add-On Investment               


June 6, 2024


Impact Home Services LLC*


Residential garage door, electrical, and plumbing services provider


$

2,233


Equity

Add-On Investment               


June 10, 2024


U.S. Expediters, LLC*


Reseller of CPAP machines and accessories


$

36,415


Equity

Add-On Investment               


June 12, 2024


Unicat Catalyst Holdings, LLC*


Global formulator and distributor of heterogeneous, consumable catalyst products primarily serving the refinery, petrochemical, and other end markets


$

10,547


Equity

New Investment


June 13, 2024


Said Differently Consulting, LLC


Digital transformation consulting firm


$

7,480,519


Senior Secured – First Lien









$

1,168,831


Revolver Commitment









$

350,649


Equity

New Investment


June 24, 2024


AGT Robotics, Inc.


Manufacturer of robotic welding solutions for metal fabrication
industry


$

10,726,931


Senior Secured – First Lien









$

1,526,600


Revolver Commitment 













*Existing portfolio company












 

 

The Company realized investments in the following portfolio companies during the three months ended June 30, 2024:
















Activity Type


Date


Company Name


Company Description


Proceeds Received


Realized Gain


 Instrument Type

Full Repayment


May 1, 2024


Nutritional Medicinals, LLC*


Manufacturer and distributor of
organic whole food, plant-based
feeding tube formulas and meal
replacement kits.


$

11,421,291


$

-


Senior Secured – First Lien

Full Realization








$

2,950,529


$

1,977,726


Equity

Full Repayment


June 4, 2024


Jurassic Acquisition Corp.*


Producer and distributor of air-float
kaolin and gel-grade attapulgite clays


$

16,581,250


$

-


Senior Secured – First Lien































*Existing portfolio company















 

 

Events Subsequent to June 30, 2024

The Company's management has evaluated subsequent events through August 7, 2024. There have been no subsequent events that require recognition or disclosure except for the following described below.

Investment Portfolio

The Company invested in the following portfolio companies subsequent to June 30, 2024:













Activity Type


Date


Company Name


Company Description


Investment Amount


 Instrument Type

Add-On Investment               


July 31, 2024


PCS Software, Inc.*


Provider of integrated transportation management
software for the inland trucking industry


$

9,995


Equity

























*Existing portfolio company












 

 

The Company realized investments in the following portfolio company subsequent to June 30, 2024:
















Activity Type


Date


Company Name


Company Description


Proceeds Received


Realized Gain


 Instrument Type

Full Realization


August 1, 2024


ICD Holdings, LLC*


Financial company that connects
corporate treasury departments with
money market and short duration
bond funds


$

2,593,039


$

2,155,185


Equity































*Existing portfolio company















 

 

Credit Facility

The outstanding balance under the Credit Facility as of August 7, 2024 was $168.7 million.

Distributions Declared

On July 10, 2024, our Board of Directors declared a regular monthly distribution for each of July, August, and September 2024, as follows:













Ex-Dividend


Record


Payment


Amount per

Declared


Date


Date


Date


Share

7/10/2024


7/31/2024


7/31/2024


8/15/2024


$

0.1333

7/10/2024


8/30/2024


8/30/2024


9/13/2024


$

0.1333

7/10/2024


9/30/2024


9/30/2024


10/15/2024


$

0.1333

 

Conference Call Information

Stellus Capital Investment Corporation will host a conference call to discuss these results on Thursday, August 8, 2024 at 11:00 AM, Central Time. The conference call will be led by Robert T. Ladd, Chief Executive Officer, and W. Todd Huskinson, Chief Financial Officer, Chief Compliance Officer, Treasurer, and Secretary.

For those wishing to participate by telephone, please dial (888) 506-0062. Use passcode 302036. Starting approximately two hours after the conclusion of the call, a replay will be available through Thursday, August 22, 2024 by dialing (877) 481-4010 and entering passcode 51014. The replay will also be available on the Company's website.

For those wishing to participate via Live Webcast, connect via the Public (SCIC) section of our website at www.stelluscapital.com, under the Events tab. A replay of the conference will be available on our website for approximately 90 days.

About Stellus Capital Investment Corporation

The Company is an externally-managed, closed-end, non-diversified investment management company that has elected to be regulated as a business development company under the Investment Company Act of 1940, as amended. The Company's investment objective is to maximize the total return to its stockholders in the form of current income and capital appreciation by investing primarily in private middle-market companies (typically those with $5.0 million to $50.0 million of EBITDA (earnings before interest, taxes, depreciation and amortization)) through first lien (including unitranche) loans, second lien loans and unsecured debt financing, with corresponding equity co-investments. The Company's investment activities are managed by its investment adviser, Stellus Capital Management. To learn more about Stellus Capital Investment Corporation, visit www.stelluscapital.com under the "Public (SCIC)" tab.

Forward-Looking Statements

Statements included herein may contain "forward-looking statements" which relate to future performance or financial condition. Statements other than statements of historical facts included in this press release may constitute forward-looking statements and are not guarantees of future performance or results and involve a number of assumptions, risks and uncertainties, which change over time. Actual results may differ materially from those anticipated in any forward-looking statements as a result of a number of factors, including those described from time to time in filings by the Company with the Securities and Exchange Commission including the final prospectus that will be filed with the Securities and Exchange Commission. The Company undertakes no duty to update any forward-looking statement made herein. All forward-looking statements speak only as of the date of this press release.

Contacts

Stellus Capital Investment Corporation
W. Todd Huskinson, Chief Financial Officer
(713) 292-5414
thuskinson@stelluscapital.com

 

STELLUS CAPITAL INVESTMENT CORPORATION

CONSOLIDATED STATEMENTS OF ASSETS AND LIABILITIES











June 30, 2024






(unaudited)


December 31, 2023


ASSETS








Controlled investments at fair value (amortized cost of $17,934,808 and $17,285,138,
respectively)


$

7,500,423


$

6,175,994


Non-controlled, non-affiliated investments, at fair value (amortized cost of
$891,583,081 and $884,858,412, respectively)



892,178,026



868,284,689


Cash and cash equivalents



35,867,781



26,125,741


Receivable for sales and repayments of investments



574,015



371,877


Interest receivable



7,663,147



4,882,338


Income tax receivable



2,174,449



1,588,708


Other receivables



135,666



42,995


Deferred offering costs





7,312


Prepaid expenses



412,737



606,674


Total Assets


$

946,506,244


$

908,086,328


LIABILITIES








Notes Payable


$

99,219,159


$

98,996,412


Credit Facility payable



166,396,015



156,564,776


SBA-guaranteed debentures



320,823,417



320,273,358


Dividends payable



3,463,267




Management fees payable



852,233



2,918,536


Income incentive fees payable



1,435,084



2,885,180


Interest payable



5,248,420



5,241,164


Related party payable



337,500




Unearned revenue



572,243



397,725


Administrative services payable



426,174



402,151


Deferred tax liability





188,893


Other accrued expenses and liabilities



547,239



278,345


Total Liabilities


$

599,320,751


$

588,146,540


Commitments and contingencies (Note 7)








Net Assets


$

347,185,493


$

319,939,788


NET ASSETS








Common stock, par value $0.001 per share (100,000,000 shares authorized; 25,980,998
and 24,125,642 issued and outstanding, respectively)


$

25,981


$

24,125


Paid-in capital



361,167,004



335,918,984


Total distributable loss



(14,007,492)



(16,003,321)


Net Assets


$

347,185,493


$

319,939,788


Total Liabilities and Net Assets


$

946,506,244


$

908,086,328


Net Asset Value Per Share


$

13.36


$

13.26


 

STELLUS CAPITAL INVESTMENT CORPORATION

CONSOLIDATED STATEMENTS OF OPERATIONS (unaudited)

















For the three months ended


For the six months ended




June 30, 2024


June 30, 2023


June 30, 2024


June 30, 2023


INVESTMENT INCOME














From controlled investments:














Interest income


$


$


$

81,636


$


From non-controlled, non-affiliated investments














Interest income



25,164,944



25,662,895



50,121,795



49,071,499


Other income



1,461,255



922,122



2,419,517



1,588,865


Total Investment Income


$

26,626,199


$

26,585,017


$

52,622,948


$

50,660,364


OPERATING EXPENSES














Management fees


$

3,852,233


$

3,865,588


$

7,704,466


$

7,600,690


Valuation fees



35,711



46,422



192,218



193,495


Administrative services expenses



481,261



466,378



972,162



928,342


Income incentive fees



2,542,530



2,603,004



5,051,640



4,727,839


Capital gains incentive fee









(569,528)


Professional fees



196,205



169,836



535,832



600,684


Directors' fees



114,250



93,250



222,500



210,500


Insurance expense



125,489



121,885



250,478



242,431


Interest expense and other fees



8,116,497



8,101,975



15,884,070



15,988,399


Income tax expense



574,037



371,786



944,756



746,549


Other general and administrative expenses



417,867



331,649



663,142



510,099


Total Operating Expenses


$

16,456,080


$

16,171,773


$

32,421,264


$

31,179,500


Income incentive fee waiver



(1,622,542)





(1,826,893)




Total Operating Expenses, net of fee waivers


$

14,833,538


$

16,171,773


$

30,594,371


$

31,179,500


Net Investment Income


$

11,792,661


$

10,413,244


$

22,028,577


$

19,480,864


Net realized gain (loss) on non-controlled, non-affiliated investments


$

1,992,482


$

(310,588)


$

(18,392,249)


$

(275,621)


Net realized loss on foreign currency translations



(29,789)



(10,704)



(54,895)



(50,616)


Net change in unrealized appreciation on controlled investments



138,189





674,759




Net change in unrealized (depreciation) appreciation on non-controlled, non-affiliated investments



(5,724,870)



(6,295,233)



17,257,150



(10,544,875)


Net change in unrealized depreciation on foreign currency translations



(5,887)



(20,323)



(9,489)



(18,449)


Benefit (provision) for taxes on net unrealized depreciation (appreciation) on investments



381,500



(65,353)



188,893



(144,113)


Net Increase in Net Assets Resulting from Operations


$

8,544,286


$

3,711,043


$

21,692,746


$

8,447,190


Net Investment Income Per Share—basic and diluted


$

0.48


$

0.49


$

0.90


$

0.95


Net Increase in Net Assets Resulting from Operations Per Share – basic and diluted


$

0.35


$

0.17


$

0.89


$

0.41


Weighted Average Shares of Common Stock Outstanding—basic and diluted



24,733,966



21,231,979



24,429,804



20,509,995


Distributions Per Share—basic and diluted


$

0.41


$

0.41


$

0.81


$

0.81


 

STELLUS CAPITAL INVESTMENT CORPORATION

CONSOLIDATED STATEMENTS OF CHANGES IN NET ASSETS (unaudited)


















Common Stock





Total






Number 


Par 


Paid-in 


distributable






of shares


value


capital


earnings (loss)


Net Assets

Balances at December 31, 2022


19,666,769


$

19,667


$

275,114,720


$

642,226


$

275,776,613

Net investment income








9,067,620



9,067,620

Net realized gain on investments








34,967



34,967

Net realized loss on foreign currency translations








(39,912)



(39,912)

Net change in unrealized depreciation on investments








(4,249,642)



(4,249,642)

Net change in unrealized appreciation on foreign currency translations








1,874



1,874

Provision for taxes on unrealized appreciation on investments








(78,760)



(78,760)

Distributions from net investment income








(7,951,284)



(7,951,284)

Issuance of common stock, net of offering costs(1)


581,614



581



8,289,988





8,290,569

Balances at March 31, 2023


20,248,383


$

20,248


$

283,404,708


$

(2,572,911)


$

280,852,045

Net investment income








10,413,244



10,413,244

Net realized loss on non-controlled, non-affiliated investments








(310,588)



(310,588)

Net realized loss on foreign currency translation








(10,704)



(10,704)

Net change in unrealized depreciation on non-controlled, non-affiliated investments








(6,295,233)



(6,295,233)

Net change in unrealized depreciation on foreign currency translations








(20,323)



(20,323)

Provision for taxes on unrealized appreciation on investments








(65,353)



(65,353)

Distributions from net investment income








(8,659,144)



(8,659,144)

Issuance of common stock, net of offering costs(1)


2,309,521



2,310



32,418,774





32,421,084

Balances at June 30, 2023


22,557,904


$

22,558


$

315,823,482


$

(7,521,012)


$

308,325,028
















Balances at December 31, 2023


24,125,642


$

24,125


$

335,918,984


$

(16,003,321)


$

319,939,788

Net investment income








10,235,916



10,235,916

Net realized loss on investments








(20,384,731)



(20,384,731)

Net realized loss on foreign currency translations








(25,106)



(25,106)

Net change in unrealized appreciation on investments








23,518,590



23,518,590

Net change in unrealized depreciation on foreign currency translations








(3,602)



(3,602)

Provision for taxes on unrealized appreciation on investments








(192,607)



(192,607)

Distributions from net investment income








(9,647,844)



(9,647,844)

Balances at March 31, 2024


24,125,642


$

24,125


$

335,918,984


$

(12,502,705)


$

323,440,404

Net investment income








11,792,661



11,792,661

Net realized gain on investments








1,992,482



1,992,482

Net realized loss on foreign currency translations








(29,789)



(29,789)

Net change in unrealized depreciation on investments








(5,586,681)



(5,586,681)

Net change in unrealized depreciation on foreign currency translations








(5,887)



(5,887)

Benefit for taxes on unrealized depreciation on investments








381,500



381,500

Distributions from net investment income








(10,049,073)



(10,049,073)

Issuance of common stock, net of offering costs(1)


1,855,356



1,856



25,248,020





25,249,876

Balances at June 30, 2024


25,980,998


$

25,981


$

361,167,004


$

(14,007,492)


$

347,185,493

















(1)

See Note 4 to the Consolidated Financial Statements on Form 10-Q filed with the Securities and Exchange Commission on August 7, 2024 for more information on offering costs.

 

STELLUS CAPITAL INVESTMENT CORPORATION

CONSOLIDATED STATEMENTS OF CASH FLOWS (unaudited)










For six months ended



June 30, 2024


June 30, 2023

Cash flows from operating activities







Net increase in net assets resulting from operations


$

21,692,746


$

8,447,190

Adjustments to reconcile net increase in net assets from operations to net cash used in operating activities:







Purchases of investments



(94,854,139)



(87,741,479)

Proceeds from sales and repayments of investments



71,824,905



44,269,661

Net change in unrealized (appreciation) depreciation on investments



(17,931,909)



10,544,875

Net change in unrealized depreciation on foreign currency translations



9,490



18,306

Increase in investments due to PIK



(1,555,868)



(1,904,853)

Amortization of premium and accretion of discount, net



(1,383,624)



(1,360,629)

Deferred tax (benefit) provision



(188,893)



144,113

Amortization of loan structure fees



544,379



289,243

Amortization of deferred financing costs



222,747



221,524

Amortization of loan fees on SBA-guaranteed debentures



550,059



624,358

Net realized loss on investments



18,392,249



275,621

Changes in other assets and liabilities







Increase in interest receivable



(2,780,809)



(654,240)

Increase in income tax receivable



(585,741)



(Increase) decrease in other receivables



(92,671)



8,876

Increase in related party receivables





(883)

Decrease in prepaid expenses



193,937



357,520

Decrease in management fees payable



(2,066,303)



(5,284,818)

(Decrease) increase in income incentive fees payable



(1,450,096)



711,987

Decrease in capital gains incentive fees payable





(569,528)

Increase in administrative services payable



24,023



50,346

Increase in interest payable



7,256



142,257

Increase (decrease) in related party payable



337,500



(284,527)

Increase (decrease) in unearned revenue



174,518



(98,964)

Decrease in income tax payable





(393,015)

Increase in other accrued expenses and liabilities



268,894



226,618

Net Cash Used in Operating Activities


$

(8,647,350)


$

(31,960,441)

Cash flows from Financing Activities







Proceeds from the issuance of common stock


$

25,777,185


$

41,448,945

Sales load for common stock issued



(386,987)



(614,721)

Offering costs paid for common stock issued



(133,010)



(121,471)

Stockholder distributions paid



(16,233,650)



(13,603,459)

Financing costs paid on Credit Facility



(66,348)



Borrowings under Credit Facility



104,400,000



37,000,000

Repayments of Credit Facility



(94,967,800)



(65,267,800)

Net Cash Provided (Used) by Financing Activities


$

18,389,390


$

(1,158,506)

Net Increase (Decrease) in Cash and Cash Equivalents


$

9,742,040


$

(33,118,947)

Cash and Cash Equivalents Balance at Beginning of Period


$

26,125,741


$

48,043,329

Cash and Cash Equivalents Balance at End of Period


$

35,867,781


$

14,924,382

Supplemental and Non-Cash Activities







Cash paid for interest expense


$

14,559,629


$

14,711,017

Income and excise tax paid



1,530,497



1,139,564

Increase in distributions payable



3,463,267



3,006,969

Decrease in deferred offering costs



(7,312)



(1,100)

 

Reconciliation of Core Net Investment Income (1)

(Unaudited)








Three Months Ended



June 30, 2024


June 30, 2023

Net investment income


$11,792,661


$10,413,244

Income tax expense


574,037


371,786

Core net investment income


$12,366,698


$10,785,030






Per share amounts:





Net investment income per share


$0.48


$0.49

Core net investment income per share


$0.50


$0.51






 

Reconciliation of Realized Net Investment Income (2)

(Unaudited)








Three Months Ended



June 30, 2024


June 30, 2023

Net investment income


$11,792,661


$10,413,244

Net realized gain (loss) on investments


1,992,482


(310,588)

Net realized loss on foreign currency translation


(29,789)


(10,704)

Total Realized Net Investment Income


$13,755,354


$10,091,952






Per share amounts:





Net investment income per share


$0.48


$0.49

Realized net investment income per share


$0.55


$0.48

 

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SOURCE Stellus Capital Investment Corporation

FAQ

What was Stellus Capital Investment 's (SCM) net investment income per share for Q2 2024?

Stellus Capital Investment (SCM) reported net investment income of $0.48 per share for Q2 2024 ended June 30.

How much did Stellus Capital Investment (SCM) declare in distributions for Q2 2024?

Stellus Capital Investment (SCM) declared distributions of $0.40 per share for Q2 2024.

What was the yield on Stellus Capital Investment 's (SCM) loan portfolio as of June 30, 2024?

The yield on Stellus Capital Investment 's (SCM) loan portfolio was 11.7% as of June 30, 2024.

How much did Stellus Capital Investment (SCM) invest in new investments during Q2 2024?

Stellus Capital Investment (SCM) made new investments totaling $66.3 million during Q2 2024.

STELLUS CAPITAL INVESTMENT CORPORATION

NYSE:SCM

SCM Rankings

SCM Latest News

SCM Stock Data

351.80M
25.98M
4.33%
14.04%
0.71%
Asset Management
Financial Services
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United States of America
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