Stellus Capital Investment Corporation Reports Results for its Fourth Fiscal Quarter and Year Ended December 31, 2024
Stellus Capital Investment (NYSE:SCM) has reported its Q4 and full-year 2024 financial results. The company achieved net investment income of $0.35 per share and core net investment income of $0.37 per share for Q4 2024. During the quarter, Stellus funded $109 million in investments and received $65 million in repayments, bringing the total portfolio to $953 million at fair value.
Investment income for Q4 2024 was $25.6 million, compared to $28.0 million in Q4 2023. Gross operating expenses decreased to $16.0 million from $16.4 million year-over-year. The company declared aggregate distributions of $0.40 per share for Q4 2024, totaling $10.9 million. As of December 31, 2024, Stellus had $175.4 million in outstanding borrowings under its Credit Facility, which provides for aggregate borrowings up to $315.0 million.
Stellus Capital Investment (NYSE:SCM) ha riportato i risultati finanziari del quarto trimestre e dell'intero anno 2024. L'azienda ha raggiunto un reddito netto da investimenti di $0,35 per azione e un reddito netto da investimenti core di $0,37 per azione per il quarto trimestre 2024. Durante il trimestre, Stellus ha finanziato investimenti per $109 milioni e ha ricevuto rimborsi per $65 milioni, portando il portafoglio totale a $953 milioni a valore equo.
Il reddito da investimenti per il quarto trimestre 2024 è stato di $25,6 milioni, rispetto ai $28,0 milioni del quarto trimestre 2023. Le spese operative lorde sono diminuite a $16,0 milioni da $16,4 milioni rispetto all'anno precedente. L'azienda ha dichiarato distribuzioni aggregate di $0,40 per azione per il quarto trimestre 2024, per un totale di $10,9 milioni. Al 31 dicembre 2024, Stellus aveva $175,4 milioni di prestiti in essere sotto la sua Credit Facility, che prevede prestiti aggregati fino a $315,0 milioni.
Stellus Capital Investment (NYSE:SCM) ha informado sus resultados financieros del cuarto trimestre y del año completo 2024. La compañía logró un ingreso neto de inversión de $0,35 por acción y un ingreso neto de inversión básico de $0,37 por acción para el cuarto trimestre de 2024. Durante el trimestre, Stellus financió $109 millones en inversiones y recibió $65 millones en reembolsos, llevando el total del portafolio a $953 millones a valor justo.
El ingreso por inversiones para el cuarto trimestre de 2024 fue de $25,6 millones, en comparación con $28,0 millones en el cuarto trimestre de 2023. Los gastos operativos brutos disminuyeron a $16,0 millones desde $16,4 millones en comparación con el año anterior. La compañía declaró distribuciones agregadas de $0,40 por acción para el cuarto trimestre de 2024, totalizando $10,9 millones. Al 31 de diciembre de 2024, Stellus tenía $175,4 millones en préstamos pendientes bajo su Crédito Facility, que permite préstamos agregados de hasta $315,0 millones.
Stellus Capital Investment (NYSE:SCM)는 2024년 4분기 및 전체 연도 재무 결과를 발표했습니다. 회사는 4분기 2024년 주당 $0.35의 순투자 수익과 주당 $0.37의 핵심 순투자 수익을 달성했습니다. 분기 동안 Stellus는 $109백만의 투자를 지원하고 $65백만의 상환을 받았으며, 공정 가치 기준으로 총 포트폴리오를 $953백만으로 증가시켰습니다.
2024년 4분기 투자 수익은 $25.6백만으로, 2023년 4분기 $28.0백만과 비교됩니다. 총 운영 비용은 전년 대비 $16.0백만에서 $16.4백만으로 감소했습니다. 회사는 2024년 4분기 주당 $0.40의 총 분배를 선언하여 총 $10.9백만에 달했습니다. 2024년 12월 31일 기준, Stellus는 $315.0백만까지의 총 대출을 제공하는 신용 시설 하에 $175.4백만의 미지급 대출이 있었습니다.
Stellus Capital Investment (NYSE:SCM) a annoncé ses résultats financiers pour le quatrième trimestre et l'année complète 2024. L'entreprise a réalisé un revenu net d'investissement de 0,35 $ par action et un revenu net d'investissement de base de 0,37 $ par action pour le quatrième trimestre 2024. Au cours du trimestre, Stellus a financé 109 millions de dollars d'investissements et a reçu 65 millions de dollars de remboursements, portant le portefeuille total à 953 millions de dollars à valeur juste.
Le revenu d'investissement pour le quatrième trimestre 2024 était de 25,6 millions de dollars, contre 28,0 millions de dollars au quatrième trimestre 2023. Les dépenses d'exploitation brutes ont diminué à 16,0 millions de dollars contre 16,4 millions de dollars d'une année sur l'autre. L'entreprise a déclaré des distributions agrégées de 0,40 $ par action pour le quatrième trimestre 2024, totalisant 10,9 millions de dollars. Au 31 décembre 2024, Stellus avait 175,4 millions de dollars de prêts en cours dans le cadre de sa facilité de crédit, qui autorise des emprunts agrégés allant jusqu'à 315,0 millions de dollars.
Stellus Capital Investment (NYSE:SCM) hat seine finanziellen Ergebnisse für das 4. Quartal und das gesamte Jahr 2024 veröffentlicht. Das Unternehmen erzielte netto Investitionseinkommen von $0,35 pro Aktie und kerns Netto Investitionseinkommen von $0,37 pro Aktie für das 4. Quartal 2024. Im Laufe des Quartals finanzierte Stellus $109 Millionen in Investitionen und erhielt $65 Millionen an Rückzahlungen, was das gesamte Portfolio auf $953 Millionen zum Fair Value brachte.
Das Investitionseinkommen für das 4. Quartal 2024 betrug $25,6 Millionen, verglichen mit $28,0 Millionen im 4. Quartal 2023. Die Brutto-Betriebskosten sanken von $16,4 Millionen auf $16,0 Millionen im Jahresvergleich. Das Unternehmen erklärte aggregierte Ausschüttungen von $0,40 pro Aktie für das 4. Quartal 2024, insgesamt $10,9 Millionen. Zum 31. Dezember 2024 hatte Stellus $175,4 Millionen an ausstehenden Krediten unter seiner Kreditfazilität, die aggregierte Kredite von bis zu $315,0 Millionen vorsieht.
- Total portfolio value reached $953M at fair value
- Funded $109M in new investments in Q4
- Maintained stable quarterly distribution of $0.40 per share
- Cumulative distributions of $288M ($16.69 per share) since inception
- Net investment income declined to $0.35/share from $0.49/share YoY
- Investment income decreased to $25.6M from $28.0M YoY
- Net unrealized depreciation of $6.9M in Q4 2024
- Increased Credit Facility borrowings to $175.4M from $160.1M YoY
Insights
Stellus Capital Investment (NYSE:SCM) reported mixed Q4 2024 results with notable declines in key performance metrics year-over-year. The BDC posted GAAP net investment income of $0.35 per share and core NII of $0.37 per share, representing significant drops of 28.6% and 26% respectively compared to Q4 2023.
Investment income fell to $25.6 million from $28.0 million year-over-year, while net asset value growth slowed considerably with a net increase in assets of $0.32 per share versus $0.48 per share in the comparable period. Despite these declines, SCM maintained its quarterly distribution of $0.40 per share, suggesting confidence in near-term cash flow generation, though this distribution currently exceeds GAAP earnings.
On the portfolio front, SCM demonstrated substantial deployment activity with $109 million in new investments against $65 million in repayments, expanding its total portfolio to $953 million at fair value. This net portfolio growth came with increased leverage, as borrowings under the credit facility rose to $175.4 million from $160.1 million year-end 2023, and further increased to $230.8 million by March 2025, reflecting continued aggressive deployment.
The mixed unrealized/realized performance with unrealized depreciation of $6.9 million offset by realized gains of $6.0 million indicates some portfolio repositioning but raises questions about underlying credit quality. While the maintained dividend provides yield support, the widening gap between distribution level and core earnings warrants close monitoring for sustainability.
Robert T. Ladd, Chief Executive Officer of Stellus, stated, "I am pleased to report solid operating results for the quarter ended December 31, 2024, in which we earned
FINANCIAL HIGHLIGHTS
($ in millions, except data relating to per share amounts and shares outstanding)
Three Months Ended | Year Ended | ||||||||||
December 31, 2024 | December 31, 2023 | December 31, 2024 | December 31, 2023 | ||||||||
Amount | Per Share | Amount | Per Share | Amount | Per Share | Amount | Per Share | ||||
Net investment income | |||||||||||
Core net investment income(1) | 10.15 | 0.37 | 12.16 | 0.50 | 43.74 | 1.71 | 42.97 | 1.95 | |||
Net realized gain (loss) on investments | 5.95 | 0.22 | (30.54) | (1.26) | (15.74) | (0.62) | (30.21) | (1.38) | |||
Net realized loss on foreign currency translation | (0.02) | — | (0.04) | — | (0.09) | — | (0.11) | — | |||
Benefit for taxes on realized loss on investments in taxable subsidiaries | — | — | 2.99 | 0.12 | — | — | 2.99 | 0.14 | |||
Total realized income(2) | ( | ( | |||||||||
Distributions | (10.90) | (0.40) | (9.65) | (0.40) | (41.22) | (1.61) | (35.53) | (1.61) | |||
Net unrealized change in (depreciation) appreciation on investments | (6.86) | (0.25) | 27.13 | 1.13 | 19.57 | 0.76 | 2.79 | 0.13 | |||
Net unrealized change in (depreciation) appreciation on foreign currency translation | (0.02) | — | 0.01 | — | (0.02) | — | (0.01) | — | |||
Benefit (provision) for taxes on unrealized depreciation (appreciation) on investments in taxable subsidiaries | — | — | 0.02 | — | 0.19 | 0.01 | (0.13) | (0.01) | |||
Net increase in net assets resulting from operations | |||||||||||
Weighted average shares outstanding | 27,174,972 | 24,125,642 | 25,596,593 | 22,004,648 | |||||||
(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- |
(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 |
PORTFOLIO ACTIVITY
($ in millions, except data relating to per share amounts, shares outstanding, and number of portfolio companies)
As of | As of | |||||||
December 31, 2024 | December 31, 2023 | |||||||
Investments at fair value | ||||||||
Total assets | ||||||||
Net assets | ||||||||
Shares outstanding | 27,481,118 | 24,125,642 | ||||||
Net asset value per share | ||||||||
Three Months Ended | Year Ended | |||||||
December 31, 2024 | December 31, 2023 | December 31, 2024 | December 31, 2023 | |||||
New investments | ||||||||
Repayments of investments | (64.5) | (55.2) | (151.8) | (134.2) | ||||
Net activity | ( | |||||||
As of | As of | |||||||
December 31, 2024 | December 31, 2023 | |||||||
Number of portfolio company investments | 105 | 93 | ||||||
Number of debt investments | 92 | 81 | ||||||
Weighted average yield of debt and other income producing investments(3) | ||||||||
Cash | 9.5 % | 11.0 % | ||||||
Payment-in-kind ("PIK") | 0.4 % | 0.5 % | ||||||
Fee amortization | 0.4 % | 0.4 % | ||||||
Total | 10.3 % | 11.9 % | ||||||
Weighted average yield on total investments(4) | ||||||||
Cash | 8.9 % | 10.3 % | ||||||
PIK | 0.4 % | 0.5 % | ||||||
Fee amortization | 0.4 % | 0.3 % | ||||||
Total | 9.7 % | 11.1 % | ||||||
(3) | The dollar-weighted average annualized effective yield is computed using the effective interest rate for the Company's 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 equity positions and debt investments on non-accrual status. |
Results of Operations
Investment income for the three months ended December 31, 2024 and 2023 totaled
Gross operating expenses for the three months ended December 31, 2024 and 2023 totaled
Net investment income was
For the three months ended December 31, 2024 and 2023, the Company's investment portfolio had a net change in unrealized (depreciation) appreciation of
Net increase in net assets resulting from operations totaled
Liquidity and Capital Resources
As of December 31, 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
As of December 31, 2024 and December 31, 2023, the Company had
The Company issued 441,754 shares during the three months ended December 31, 2024 under the At-the-Market Program ("ATM Program") for gross proceeds of
Distributions
During the three months ended December 31, 2024 and 2023, the Company declared aggregate distributions of
Recent Portfolio Activity
The Company invested in the following portfolio companies during the three months ended December 31, 2024:
Activity Type | Date | Company Name | Company Description | Investment Amount | Instrument Type | ||||||
Add-On Investment | October 9, 2024 | Ledge Lounger, Inc.* | Provider of premium in-pool and backyard furniture | $ | 34,504 | Equity | |||||
Add-On Investment | October 18, 2024 | Compost 360 Investments, LLC* | Organic waste recycler and producer of compost, mulch, and engineered soils | $ | 49,280 | Equity | |||||
New Investment | October 31, 2024 | Norplex Micarta Acquisition, Inc. | Manufacturer of thermoset composite laminates | $ | 13,000,000 | Senior Secured – First Lien | |||||
$ | 500,000 | Revolver Commitment | |||||||||
$ | 739,804 | Equity | |||||||||
Add-On Investment | November 7, 2024 | Green Intermediateco II, Inc.* | Cyber-security focused value-added reseller and associated service provider | $ | 1,300,000 | Senior Secured – First Lien | |||||
Add-On Investment | November 12, 2024 | Curion Holdings, LLC* | Provider of product testing and consumer insights | $ | 21,710 | Revolver Commitment | |||||
Add-On Investment | November 12, 2024 | Cerebro Buyer, LLC* | Manufacturer of single-use electrodes for medical procedures | $ | 1,130,707 | Delayed Draw Term Loan Commitment | |||||
Add-On Investment | November 12, 2024 | Service Minds Company, LLC* | Provider of residential electrical services | $ | 45,000 | Revolver Commitment | |||||
New Investment | November 14, 2025 | Spectra Confectionary Ltd. | Manufacturer and wholesaler of confectionary products | $ | 5,317,225 | Senior Secured – First Lien | |||||
$ | 297,765 | Equity | |||||||||
New Investment | November 15, 2024 | MBH Management, LLC | Outsourced provider of physician-focused staffing solutions for post-acute facilities | $ | 9,476,743 | Senior Secured – First Lien | |||||
$ | 500,000 | Delayed Draw Term Loan Commitment | |||||||||
$ | 500,000 | Revolver Commitment | |||||||||
$ | 646,944 | Equity | |||||||||
Add-On Investment | November 20, 2024 | Microbe Formulas LLC* | Provider of dietary supplements and other natural solutions for detox and gut health | $ | 4,265,082 | Senior Secured – First Lien | |||||
Add-On Investment | November 26, 2024 | Equine Network, LLC* | Provider of content, information, tech-enabled services, and hosts competitions for the | $ | 1,146,399 | Senior Secured – First Lien | |||||
$ | 66,667 | Revolver Commitment | |||||||||
Add-On Investment | December 2, 2024 | 2X LLC* | Provider of outsourced digital business-to-business marketing-as-a-service | $ | 3,861,355 | Senior Secured – First Lien | |||||
Add-On Investment | December 3, 2024 | Camp Profiles LLC* | Provider of digital marketing services to small and medium-sized businesses | $ | 2,250,000 | Senior Secured – First Lien | |||||
New Investment | December 4, 2024 | AMII Acquisition, LLC | Franchisor of ballroom dance studios | $ | 8,819,468 | Senior Secured – First Lien | |||||
$ | 500,000 | Revolver Commitment | |||||||||
$ | 142,460 | Equity | |||||||||
Add-On Investment | December 6, 2024 | Advanced Barrier Extrusions, LLC* | Manufacturer of high barrier forming | $ | 604,622 | Revolver Commitment | |||||
New Investment | December 9, 2024 | United States Drug Testing Laboratories, LLC | Provider of drug and alcohol forensic toxicology testing | $ | 6,000,000 | Senior Secured – First Lien | |||||
$ | 500,000 | Delayed Draw Term Loan Commitment | |||||||||
$ | 100,000 | Revolver Commitment | |||||||||
$ | 110,000 | Equity | |||||||||
New Investment | December 17, 2024 | iNovex Information Systems Inc. | Provider of government IT services | $ | 7,522,184 | Senior Secured – First Lien | |||||
$ | 100,000 | Revolver Commitment | |||||||||
New Investment | December 19, 2024 | Eskola, LLC | Provider of commercial re-roofing services | $ | 7,558,348 | Senior Secured – First Lien | |||||
$ | 6,717,083 | Revolver Commitment | |||||||||
$ | 893,991 | Equity | |||||||||
Add-On Investment | December 20, 2024 | CEATI International, Inc.* | Provider of intellectual content, technical trade programs, research groups, and conferences for utility companies | $ | 3,200,000 | Senior Secured – First Lien | |||||
New Investment | December 20, 2024 | CombinedCaterers, Inc. | Provider of premium catering services in the Southeast | $ | 6,796,831 | Senior Secured – First Lien | |||||
$ | 2,216,358 | Delayed Draw Term Loan Commitment | |||||||||
$ | 100,000 | Revolver Commitment | |||||||||
$ | 465,637 | Equity | |||||||||
Add-On Investment | December 27, 2024 | Naumann/Hobbs Material Handling Corporation II, Inc.* | Material handling equipment dealer and aftermarket parts and services provider | $ | 142,200 | Equity | |||||
New Investment | December 30, 2024 | Tiger 21, LLC | Facilitator of peer-to-peer wealth focused insights and events for ultra-high net worth individuals | $ | 12,000,000 | Senior Secured – First Lien | |||||
$ | 100,000 | Revolver Commitment | |||||||||
$ | 564,635 | Equity | |||||||||
*Existing portfolio company | |||||||||||
The Company realized investments in the following portfolio companies during the three months ended December 31, 2024:
Activity Type | Date | Company Name | Company Description | Proceeds Received | Realized Gain | Instrument Type | ||||||||
Full Repayment | November 4, 2024 | Baker Manufacturing Company, LLC* | Manufacturer of water well equipment, specialized filtration pumps, and custom castings | $ | 12,738,093 | $ | — | Senior Secured – First Lien | ||||||
Full Realization | November 5, 2024 | Health Monitor Holdings, LLC* | Provider of point-of-care patient engagement and marketing solutions for pharmaceutical companies | $ | 1,704,298 | $ | 651,379 | Equity | ||||||
Full Repayment | November 21, 2024 | Intuitive Health, LLC* | Operator of freestanding urgent care/emergency room combination facilities | $ | 16,647,430 | $ | — | Senior Secured – First Lien | ||||||
$ | 514,101 | $ | 514,101 | Equity | ||||||||||
Full Repayment | December 2, 2024 | Integrated Oncology Network, LLC* | Provider of radiation oncology center management services | $ | 17,518,143 | $ | — | Senior Secured – First Lien | ||||||
*Existing portfolio company | ||||||||||||||
Events Subsequent to December 31, 2024
The Company's management has evaluated subsequent events through March 4, 2025. 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 December 31, 2024:
Activity Type | Date | Company Name | Company Description | Investment Amount | Instrument Type | ||||||
New Investment | January 10, 2025 | Pacific Shoring Products, LLC | Manufacturer of trench shoring and safety equipment sold to equipment rental companies | $ | 8,500,000 | Senior Secured – First Lien | |||||
$ | 100,000 | Revolver Commitment | |||||||||
$ | 498,491 | Equity | |||||||||
New Investment | January 15, 2025 | Environmental Remedies, LLC | Residential asbestos abatement provider | $ | 7,330,762 | Senior Secured – First Lien | |||||
$ | 2,681,986 | Delayed Draw Term Loan Commitment | |||||||||
$ | 100,000 | Revolver Commitment | |||||||||
$ | 163,109 | Equity | |||||||||
New Investment | January 16, 2025 | Plus Delta Partners, Inc. | Provider of fundraising training and tools for higher education institutions and other nonprofits | $ | 7,400,000 | Senior Secured – First Lien | |||||
$ | 3,753,955 | Delayed Draw Term Loan Commitment | |||||||||
$ | 100,000 | Revolver Commitment | |||||||||
$ | 325,764 | Equity | |||||||||
New Investment | January 24, 2025 | Strategus, LLC | Provider of connected TV advertising services | $ | 7,801,439 | Senior Secured – First Lien | |||||
$ | 2,524,737 | Delayed Draw Term Loan Commitment | |||||||||
$ | 100,000 | Revolver Commitment | |||||||||
$ | 170,362 | Equity | |||||||||
Add-On Investment | February 10, 2025 | Florachem Corporation* | Distiller and supplier of natural citrus, pine, and specialty inputs | $ | 877,716 | Senior Secured – First Lien | |||||
New Investment | February 28, 2025 | Identity Theft Guard Solutions, Inc. | Cyber breach response and monitoring services | $ | 8,722,887 | Senior Secured – First Lien | |||||
$ | 100,000 | Revolver Commitment | |||||||||
$ | 352,915 | Equity | |||||||||
New Investment | February 28, 2025 | MoboTrex, LLC | Distributor and manufacturer of intelligent traffic solution equipment | $ | 5,137,070 | Senior Secured – First Lien | |||||
$ | 109,312 | Delayed Draw Term Loan Commitment | |||||||||
$ | 100,000 | Revolver Commitment | |||||||||
*Existing portfolio company | |||||||||||
Credit Facility
The outstanding balance under the Credit Facility as of March 4, 2025 was
SBA-guaranteed debentures
On February 14, 2025, Stellus Capital SBIC LP prepaid all principal and accrued interest related to SBA-guaranteed debentures maturing on March 1, 2025. The outstanding balance of SBA-guaranteed debentures as of March 4, 2025 was
Distributions Declared
On January 9, 2025, the Company's Board of Directors declared a regular monthly distribution for each of January, February and March 2025, as follows:
Ex-Dividend | Record | Payment | Amount per | ||||||
Declared | Date | Date | Date | Share | |||||
1/9/2025 | 1/31/2025 | 1/31/2025 | 2/14/2025 | $ | 0.1333 | ||||
1/9/2025 | 2/28/2025 | 2/28/2025 | 3/14/2025 | $ | 0.1333 | ||||
1/9/2025 | 3/31/2025 | 3/31/2025 | 4/15/2025 | $ | 0.1333 | ||||
Conference Call Information
Stellus Capital Investment Corporation will host a conference call to discuss these results on Wednesday, March 5, 2025 at 10:00 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 643131. Starting approximately two hours after the conclusion of the call, a replay will be available through Wednesday, March 19, 2025 by dialing (877) 481-4010 and entering passcode 52042. 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 the Company's website at www.stelluscapital.com, under the Events tab. A replay of the conference will be available on the Company's 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
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 | ||||||
December 31, 2024 | December 31, 2023 | |||||
ASSETS | ||||||
Controlled investments at fair value (amortized cost of | $ | 7,652,436 | $ | 6,175,994 | ||
Non-controlled, non-affiliated investments, at fair value (amortized cost of | 945,845,252 | 868,284,689 | ||||
Cash and cash equivalents | 20,058,594 | 26,125,741 | ||||
Receivable for sales and repayments of investments | 335,689 | 371,877 | ||||
Interest receivable | 4,947,765 | 4,882,338 | ||||
Income tax receivable | 1,301,965 | 1,588,708 | ||||
Other receivables | 87,995 | 42,995 | ||||
Related party receivable | 3,687 | — | ||||
Deferred offering costs | — | 7,312 | ||||
Prepaid expenses | 666,866 | 606,674 | ||||
Total Assets | $ | 980,900,249 | $ | 908,086,328 | ||
LIABILITIES | ||||||
Notes Payable | $ | 99,444,355 | $ | 98,996,412 | ||
Credit Facility payable | 172,314,315 | 156,564,776 | ||||
SBA-guaranteed debentures | 321,251,939 | 320,273,358 | ||||
Dividends payable | 3,663,233 | — | ||||
Management fees payable | 4,034,109 | 2,918,536 | ||||
Income incentive fees payable | 3,109,560 | 2,885,180 | ||||
Interest payable | 5,281,343 | 5,241,164 | ||||
Unearned revenue | 548,626 | 397,725 | ||||
Administrative services payable | 393,513 | 402,151 | ||||
Deferred tax liability | — | 188,893 | ||||
Other accrued expenses and liabilities | 937,316 | 278,345 | ||||
Total Liabilities | $ | 610,978,309 | $ | 588,146,540 | ||
Commitments and contingencies (Note 7) | ||||||
Net Assets | $ | 369,921,940 | $ | 319,939,788 | ||
NET ASSETS | ||||||
Common stock, par value | $ | 27,481 | $ | 24,125 | ||
Paid-in capital | 379,549,272 | 335,918,984 | ||||
Total distributable loss | (9,654,813) | (16,003,321) | ||||
Net Assets | $ | 369,921,940 | $ | 319,939,788 | ||
Total Liabilities and Net Assets | $ | 980,900,249 | $ | 908,086,328 | ||
Net Asset Value Per Share | $ | 13.46 | $ | 13.26 | ||
STELLUS CAPITAL INVESTMENT CORPORATION CONSOLIDATED STATEMENTS OF OPERATIONS | |||||||||
For the years ended | |||||||||
December 31, 2024 | December 31, 2023 | December 31, 2022 | |||||||
INVESTMENT INCOME | |||||||||
From controlled investments: | |||||||||
Interest income | $ | 81,636 | $ | 37,897 | $ | — | |||
From non-controlled, non-affiliated investments | |||||||||
Interest income | 99,804,184 | 101,978,891 | 72,964,999 | ||||||
Other income | 4,850,313 | 3,830,780 | 2,147,577 | ||||||
Total Investment Income | $ | 104,736,133 | $ | 105,847,568 | $ | 75,112,576 | |||
OPERATING EXPENSES | |||||||||
Management fees | $ | 15,698,129 | $ | 15,452,347 | $ | 14,848,174 | |||
Valuation fees | 380,239 | 373,628 | 351,752 | ||||||
Administrative services expenses | 1,916,283 | 1,908,191 | 1,810,576 | ||||||
Income incentive fees | 10,045,966 | 10,189,888 | 3,782,151 | ||||||
Capital gains incentive fee reversal | — | (569,528) | (2,818,623) | ||||||
Professional fees | 1,190,232 | 1,455,372 | 1,103,693 | ||||||
Directors' fees | 412,000 | 406,000 | 329,000 | ||||||
Insurance expense | 499,913 | 492,596 | 503,907 | ||||||
Interest expense and other fees | 31,506,068 | 32,011,317 | 24,469,285 | ||||||
Income tax expense | 1,808,838 | 1,333,452 | 1,161,668 | ||||||
Other general and administrative expenses | 1,175,765 | 891,170 | 984,309 | ||||||
Total Operating Expenses | $ | 64,633,433 | $ | 63,944,433 | $ | 46,525,892 | |||
Income incentive fee waiver | (1,826,893) | (307,442) | — | ||||||
Total Operating Expenses, net of fee waivers | $ | 62,806,540 | $ | 63,636,991 | $ | 46,525,892 | |||
Net Investment Income | $ | 41,929,593 | $ | 42,210,577 | $ | 28,586,684 | |||
Net realized (loss) gain on non-controlled, non-affiliated investments | $ | (15,737,004) | $ | (30,211,467) | $ | 3,660,595 | |||
Net realized loss on foreign currency translations | (94,730) | (112,481) | (6,091) | ||||||
Net change in unrealized appreciation (depreciation) on controlled investments | 826,772 | (430,577) | — | ||||||
Net change in unrealized appreciation (depreciation) on non-controlled, non-affiliated investments | 18,743,637 | 3,222,729 | (17,542,230) | ||||||
Net change in unrealized (depreciation) appreciation on foreign currency translations | (14,755) | (6,504) | 6,040 | ||||||
Benefit (provision) for taxes on net unrealized depreciation (appreciation) on investments | 188,893 | (126,957) | (213,214) | ||||||
Benefit for taxes on net realized loss on investments | 2,221 | 2,987,847 | — | ||||||
Net Increase in Net Assets Resulting from Operations | $ | 45,844,627 | 17,533,167 | 14,491,784 | |||||
Net Investment Income Per Share—basic and diluted | $ | 1.64 | $ | 1.92 | $ | 1.46 | |||
Net Increase in Net Assets Resulting from Operations Per Share – basic and diluted | $ | 1.79 | $ | 0.80 | $ | 0.74 | |||
Weighted Average Shares of Common Stock Outstanding—basic and diluted | 25,596,593 | 22,004,648 | 19,552,931 | ||||||
Distributions Per Share—basic and diluted | $ | 1.61 | $ | 1.61 | $ | 1.30 | |||
STELLUS CAPITAL INVESTMENT CORPORATION CONSOLIDATED STATEMENTS OF CHANGES IN NET ASSETS | ||||||||||||||
Common Stock | Total | |||||||||||||
Number | Par | Paid-in | distributable | |||||||||||
of shares | value | capital | (loss) earnings | Net Assets | ||||||||||
Balances as of December 31, 2021 | 19,517,595 | $ | 19,518 | $ | 274,559,121 | $ | 10,532,594 | $ | 285,111,233 | |||||
Net investment income | — | — | — | 28,586,684 | 28,586,684 | |||||||||
Net realized gain on investments | — | — | — | 3,660,595 | 3,660,595 | |||||||||
Net realized loss on foreign currency translation | — | — | — | (6,091) | (6,091) | |||||||||
Net change in unrealized depreciation on investments | — | — | — | (17,542,230) | (17,542,230) | |||||||||
Net change in unrealized appreciation on foreign currency translations | — | — | — | 6,040 | 6,040 | |||||||||
Provision for taxes on unrealized appreciation on investments | — | — | — | (213,214) | (213,214) | |||||||||
Return of capital and other tax related adjustments | — | — | (1,040,884) | 1,040,884 | — | |||||||||
Distributions from net investment income | — | — | — | (21,633,343) | (21,633,343) | |||||||||
Distributions from net realized capital gains | — | — | — | (3,789,693) | (3,789,693) | |||||||||
Issuance of common stock, net of offering costs(1) | 149,174 | 149 | 1,596,483 | — | 1,596,632 | |||||||||
Balances at December 31, 2022 | 19,666,769 | $ | 19,667 | $ | 275,114,720 | $ | 642,226 | $ | 275,776,613 | |||||
Net investment income | — | — | — | 42,210,577 | 42,210,577 | |||||||||
Net realized loss on investments | — | — | — | (30,211,467) | (30,211,467) | |||||||||
Net realized loss on foreign currency translation | — | — | — | (112,481) | (112,481) | |||||||||
Net change in unrealized appreciation on investments | — | — | — | 2,792,152 | 2,792,152 | |||||||||
Net change in unrealized depreciation on foreign currency translations | — | — | — | (6,504) | (6,504) | |||||||||
Provision for taxes on unrealized appreciation on investments | — | — | — | (126,957) | (126,957) | |||||||||
Benefit for taxes on realized loss on investments | — | — | — | 2,987,847 | 2,987,847 | |||||||||
Return of capital and other tax related adjustments | — | — | (1,348,766) | 1,348,766 | — | |||||||||
Distributions from net investment income | — | — | — | (35,080,734) | (35,080,734) | |||||||||
Distributions from net realized capital gains | — | — | — | (446,746) | (446,746) | |||||||||
Issuance of common stock, net of offering costs(1) | 4,458,873 | 4,458 | 62,153,030 | — | 62,157,488 | |||||||||
Balances at December 31, 2023 | 24,125,642 | $ | 24,125 | $ | 335,918,984 | $ | (16,003,321) | $ | 319,939,788 | |||||
Net investment income | — | — | — | 41,929,593 | 41,929,593 | |||||||||
Net realized loss on investments | — | — | — | (15,737,004) | (15,737,004) | |||||||||
Net realized loss on foreign currency translation | — | — | — | (94,730) | (94,730) | |||||||||
Net change in unrealized appreciation on investments | — | — | — | 19,570,409 | 19,570,409 | |||||||||
Net change in unrealized depreciation on foreign currency translations | — | — | — | (14,755) | (14,755) | |||||||||
Provision for taxes on unrealized appreciation on investments | — | — | — | 188,893 | 188,893 | |||||||||
Benefit for taxes on realized loss on investments | — | — | — | 2,221 | 2,221 | |||||||||
Return of capital and other tax related adjustments | — | — | (1,727,556) | 1,727,556 | — | |||||||||
Distributions from net investment income | — | — | — | (40,679,308) | (40,679,308) | |||||||||
Distributions from net realized capital gains | — | — | — | (544,367) | (544,367) | |||||||||
Issuance of common stock, net of offering costs(1) | 3,355,476 | 3,356 | 45,357,844 | — | 45,361,200 | |||||||||
Balances at December 31, 2024 | 27,481,118 | $ | 27,481 | $ | 379,549,272 | $ | (9,654,813) | $ | 369,921,940 | |||||
_________________ | |
(1) | See Note 4 to the Consolidated Financial Statements on Form 10-K filed with the Securities and Exchange Commission on March 4, 2025 for more information on offering costs. |
STELLUS CAPITAL INVESTMENT CORPORATION CONSOLIDATED STATEMENTS OF CASH FLOWS | |||||||||
For the years ended | |||||||||
December 31, 2024 | December 31, 2023 | December 31, 2022 | |||||||
Cash flows from operating activities | |||||||||
Net increase in net assets resulting from operations | $ | 45,844,627 | $ | 17,533,167 | $ | 14,491,784 | |||
Adjustments to reconcile net increase in net assets from operations to net cash used in operating activities: | |||||||||
Purchases of investments | (221,154,933) | (183,858,762) | (211,010,869) | ||||||
Proceeds from sales and repayments of investments | 151,834,875 | 134,223,224 | 127,548,194 | ||||||
Net change in unrealized (appreciation) depreciation on investments | (19,570,409) | (2,792,152) | 17,542,230 | ||||||
Net change in unrealized depreciation (appreciation) on foreign currency translations | 14,755 | 6,360 | (5,897) | ||||||
Increase in investments due to PIK | (3,310,111) | (3,799,843) | (1,357,177) | ||||||
Amortization of premium and accretion of discount, net | (2,715,802) | (2,749,543) | (2,519,462) | ||||||
Deferred tax (benefit) provision | (188,893) | 126,957 | 213,214 | ||||||
Amortization of loan structure fees | 1,140,079 | 657,323 | 567,375 | ||||||
Amortization of deferred financing costs | 447,943 | 446,720 | 446,719 | ||||||
Amortization of loan fees on SBA-guaranteed debentures | 978,582 | 1,255,753 | 1,227,952 | ||||||
Net realized loss (gain) on investments | 15,737,004 | 30,211,467 | (3,660,595) | ||||||
Changes in other assets and liabilities | |||||||||
Increase in interest receivable | (65,427) | (897,929) | (1,039,810) | ||||||
Decrease (increase) in income tax receivable | 286,743 | (1,588,708) | — | ||||||
(Increase) decrease in other receivables | (45,000) | (8,750) | 20,507 | ||||||
Increase in related party receivables | (3,687) | — | — | ||||||
(Increase) decrease in prepaid expenses | (60,192) | 60,593 | (155,053) | ||||||
Increase (decrease) in management fees payable | 1,115,573 | (4,231,871) | 3,696,182 | ||||||
Increase in income incentive fees payable | 224,380 | 420,772 | 715,278 | ||||||
Decrease in capital gains incentive fees payable | — | (569,528) | (2,818,623) | ||||||
(Decrease) increase in administrative services payable | (8,638) | 45,232 | (29,449) | ||||||
Increase in interest payable | 40,179 | 600,323 | 947,179 | ||||||
(Decrease) increase in related party payable | — | (1,060,321) | 1,060,321 | ||||||
Increase (decrease) in unearned revenue | 150,901 | 77,050 | (209,051) | ||||||
Decrease in income tax payable | — | (1,175,373) | (2,094,141) | ||||||
Increase (decrease) in other accrued expenses and liabilities | 658,971 | (197,248) | 136,635 | ||||||
Net Cash Used in Operating Activities | $ | (28,648,480) | $ | (17,265,087) | $ | (56,286,557) | |||
Cash flows from Financing Activities | |||||||||
Proceeds from the issuance of common stock | $ | 46,494,756 | $ | 63,348,436 | $ | 2,158,540 | |||
Sales load for common stock issued | (698,166) | (943,248) | (31,066) | ||||||
Offering costs paid for common stock issued | (428,078) | (253,913) | (517,054) | ||||||
Stockholder distributions paid | (37,560,442) | (35,527,480) | (26,594,095) | ||||||
Proceeds from SBA-guaranteed debentures | — | 11,400,000 | 63,600,000 | ||||||
Financing costs paid on SBA-guaranteed debentures | — | (277,590) | (1,548,660) | ||||||
Financing costs paid on Credit Facility | (691,137) | (2,663,106) | (193,635) | ||||||
Borrowings under Credit Facility | 187,900,000 | 108,400,000 | 149,888,800 | ||||||
Repayments of Credit Facility | (172,435,600) | (148,135,600) | (126,607,800) | ||||||
Net Cash Provided (Used) by Financing Activities | $ | 22,581,333 | $ | (4,652,501) | $ | 60,155,030 | |||
Net Decrease in Cash and Cash Equivalents | $ | (6,067,147) | $ | (21,917,588) | $ | 3,868,473 | |||
Cash and Cash Equivalents Balance at Beginning of Period | 26,125,741 | 48,043,329 | 44,174,856 | ||||||
Cash and Cash Equivalents Balance at End of Period | $ | 20,058,594 | $ | 26,125,741 | $ | 48,043,329 | |||
Supplemental and Non-Cash Activities | |||||||||
Cash paid for interest expense | $ | 28,899,285 | $ | 29,051,198 | $ | 21,280,060 | |||
Income and excise tax paid | 1,808,838 | 2,508,825 | 3,255,809 | ||||||
(Decrease) increase in distributions payable | 3,663,233 | — | (1,171,059) | ||||||
(Decrease) increase in deferred offering costs | (7,312) | 6,212 | (13,788) | ||||||
Exchange of investments | 8,256,411 | 3,610,846 | — | ||||||
Reconciliation of Core Net Investment Income (1) (Unaudited) | ||||||||
Three Months Ended | Year Ended | |||||||
December 31, 2024 | December 31, 2023 | December 31, 2024 | December 31, 2023 | |||||
Net investment income | ||||||||
Capital gains incentive reversal | — | — | — | (569,528) | ||||
Income tax expense | 503,890 | 251,395 | 1,808,838 | 1,333,452 | ||||
Core net investment income | ||||||||
Per share amounts: | ||||||||
Net investment income per share | ||||||||
Core net investment income per share | ||||||||
Reconciliation of Realized Net Investment Income (2) (Unaudited) | ||||||||
Three Months Ended | Year Ended | |||||||
December 31, 2024 | December 31, 2023 | December 31, 2024 | December 31, 2023 | |||||
Net investment income | ||||||||
Net realized gain (loss) on investments | 5,952,860 | (30,536,249) | (15,737,004) | (30,211,467) | ||||
Net realized loss on foreign currency translation | (17,740) | (39,699) | (94,730) | (112,481) | ||||
Benefit for taxes on realized loss on investments | — | 2,987,847 | 2,221 | 2,987,847 | ||||
Total Realized Net Investment Income (Loss) | ( | |||||||
Per share amounts: | ||||||||
Net investment income per share | ||||||||
Realized net investment income (loss) per share | ( | |||||||
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SOURCE Stellus Capital Investment Corporation
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