Portman Ridge Finance Corporation (Nasdaq: PTMN) (the “Company” or
“Portman Ridge”) announced today its financial results for the
third quarter ended September 30, 2023.
Third Quarter 2023 Highlights
- Total investment
income for the third quarter of 2023 was $18.6 million, a
decrease of $0.4 million as compared to $19.0 million for the third
quarter of 2022 and a decrease of $1.0 million as compared to $19.6
million for the second quarter of 2023.
- Core investment
income1, excluding the impact of purchase
price accounting, for the third quarter of 2023 was $18.3 million,
an increase of $0.7 million as compared to $17.6 million for the
third quarter of 2022 and a decrease of $0.9 million as compared to
$19.2 million for the second quarter of 2023.
- Net investment income
("NII") for the third quarter of 2023 was $7.2 million
($0.75 per share), a decrease of $1.2 million as compared to $8.4
million ($0.87 per share) for the third quarter of 2022 and a
decrease of $0.7 million as compared to $7.9 million ($0.83 per
share) for the second quarter of 2023.
- Total shares
repurchased in open market transactions under the Renewed
Stock Repurchase Program during the quarter ended September 30,
2023 were 60,559 shares at an aggregate cost of approximately $1.2
million.
Subsequent Events
- Declared stockholder
distribution of $0.69 per
share for the fourth quarter of 2023, payable on November
30, 2023 to stockholders of record at the close of business on
November 20, 2023. This is a $0.02 per share distribution increase
as compared to the fourth quarter of 2022. Including the
distribution subsequent to the announcement of full year 2022
earnings results, total stockholder distributions for 2023 amount
to $2.75 per share.
_______________1 Core investment income
represents reported total investment income as determined in
accordance with U.S. generally accepted accounting principles, or
U.S. GAAP, less the impact of purchase price discount accounting in
connection with the Garrison Capital Inc. (“GARS”) and Harvest
Capital Credit Corporation (“HCAP”) mergers. Portman Ridge believes
presenting core investment income and the related per share amount
is useful and appropriate supplemental disclosure for analyzing its
financial performance due to the unique circumstance giving rise to
the purchase accounting adjustment. However, core investment income
is a non-U.S. GAAP measure and should not be considered as a
replacement for total investment income and other earnings measures
presented in accordance with U.S. GAAP. Instead, core investment
income should be reviewed only in connection with such U.S. GAAP
measures in analyzing Portman Ridge’s financial performance.
Management Commentary
Ted Goldthorpe, Chief Executive Officer of Portman
Ridge, stated, “I am pleased to announce another solid
quarter of financial performance for Portman Ridge, as total
investment income, net investment income and core investment income
increased substantially compared to the same nine month period of
the prior year, despite operating in a challenging market
environment. We believe that our stock remains undervalued and
thus, during the quarter we continued to repurchase shares for an
aggregate of $1.2 million through the share repurchase program,
positively affecting the company’s net asset value per share. As a
result of our strong financial performance during the quarter, the
board of directors was able to approve a dividend of $0.69 per
share, an increase of $0.02 per share as compared to the fourth
quarter of 2022. As we enter the final quarter of the year, we
continue our strategy of being highly selective in our investment
and capital deployment process and believe that we are well
positioned to take advantage of new investment opportunities to
utilize our available cash and borrowings capacity.”
Selected Financial Highlights
- Total investments at fair
value as of September 30, 2023 was $500.4 million; when
excluding CLO funds, Joint Ventures, and short-term investments,
these investments are spread across 26 different industries and 101
different entities with an average par balance per entity of
approximately $3.3 million.
- Weighted average
contractual interest rate on our interest earning Debt
Securities Portfolio as of September 30, 2023 was approximately
12.3%.
- Non-accruals on debt
investments, as of September 30, 2023, were eight debt
investments representing 1.6% and 3.6% of the Company’s investment
portfolio at fair value and amortized cost, respectively.
- Net asset value
(“NAV”) for the third quarter of 2023 was $214.8 million
($22.65 per share), an increase of $0.11 per share as compared to
$215.0 million ($22.54 per share) for the second quarter of 2023.
The increase in NAV per share, despite total NAV decreasing
slightly, was predominately driven by the repurchase of 60,559
shares during the third quarter.
- Par value of outstanding
borrowings, as of September 30, 2023, was $321.5 million
with an asset coverage ratio of total assets to total borrowings of
166%. On a net basis, leverage as of September 30, 2023 was 1.34x2
compared to net leverage of 1.39x3 as of June 30, 2023.
_______________2 Net leverage is calculated as
the ratio between (A) debt, excluding unamortized debt issuance
costs, less available cash and cash equivalents, and restricted
cash and (B) NAV. Portman Ridge believes presenting a net leverage
ratio is useful and appropriate supplemental disclosure because it
reflects the Company’s financial condition net of $33.7 million and
$35.4 million of cash and cash equivalents and restricted cash for
the quarters ended September 30, 2023 and June 30, 2023,
respectively. However, the net leverage ratio is a non-U.S. GAAP
measure and should not be considered as a replacement for the
regulatory asset coverage ratio and other similar information
presented in accordance with U.S. GAAP. Instead, the net leverage
ratio should be reviewed only in connection with such U.S. GAAP
measures in analyzing Portman Ridge’s financial condition.
Results of Operations
Operating results for the three months and nine
ended September 30, 2023 and September 30, 2022 were as
follows:
|
|
For the Three Months
EndedSeptember 30, |
|
|
For the Nine Months EndedSeptember 30, |
|
|
|
2023 |
|
|
2022 |
|
|
2023 |
|
|
2022 |
|
Total investment income |
|
$ |
18,574 |
|
|
$ |
19,009 |
|
|
$ |
58,527 |
|
|
$ |
50,997 |
|
Total expenses |
|
|
11,408 |
|
|
|
10,617 |
|
|
|
34,917 |
|
|
|
29,175 |
|
Net Investment Income |
|
|
7,166 |
|
|
|
8,392 |
|
|
|
23,610 |
|
|
|
21,822 |
|
Net realized gain (loss) on investments |
|
|
(1,636 |
) |
|
|
(9,087 |
) |
|
|
(11,192 |
) |
|
|
(28,631 |
) |
Net unrealized gain (loss) on investments |
|
|
1,708 |
|
|
|
(2,968 |
) |
|
|
(8,428 |
) |
|
|
(712 |
) |
Tax (provision) benefit on realized and unrealized
gains (losses) on investments |
|
$ |
264 |
|
|
$ |
(542 |
) |
|
$ |
671 |
|
|
$ |
(1,059 |
) |
Net realized and unrealized appreciation (depreciation) on
investments, net of taxes |
|
$ |
336 |
|
|
$ |
(12,597 |
) |
|
$ |
(18,949 |
) |
|
$ |
(30,402 |
) |
Realized
gains (losses) on extinguishments of debt |
|
|
(57 |
) |
|
$ |
- |
|
|
$ |
(275 |
) |
|
$ |
- |
|
Net Increase (Decrease) in Net Assets Resulting from
Operations |
|
$ |
7,445 |
|
|
$ |
(4,205 |
) |
|
$ |
4,386 |
|
|
$ |
(8,580 |
) |
Net Increase (Decrease) In Net Assets Resulting from Operations per
Common Share: |
|
|
|
|
|
|
|
|
|
|
|
|
Basic and Diluted: |
|
$ |
0.78 |
|
|
$ |
(0.44 |
) |
|
$ |
0.46 |
|
|
$ |
(0.89 |
) |
Net Investment Income Per Common Share: |
|
|
|
|
|
|
|
|
|
|
|
|
Basic and Diluted: |
|
$ |
0.75 |
|
|
$ |
0.87 |
|
|
$ |
2.48 |
|
|
$ |
2.26 |
|
Weighted Average Shares of Common Stock Outstanding—Basic and
Diluted |
|
|
9,505,172 |
|
|
|
9,602,712 |
|
|
|
9,533,835 |
|
|
|
9,644,870 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Investment Income
The composition of our investment income for the
three and nine months ended September 30, 2023, and September 30,
2022 was as follows:
|
|
For the Three Months Ended September 30, |
|
For the Nine Months Ended September 30, |
($ in
thousands) |
|
2023 |
2022 |
|
2023 |
2022 |
Interest from investments in debt excluding accretion |
|
$ |
13,174 |
|
$ |
12,232 |
|
|
$ |
41,436 |
|
$ |
31,320 |
|
Purchase
discount accounting |
|
|
238 |
|
|
1,404 |
|
|
|
1,706 |
|
|
4,518 |
|
PIK
Investment Income |
|
|
2,421 |
|
|
1,740 |
|
|
|
4,987 |
|
|
4,414 |
|
CLO
Income |
|
|
502 |
|
|
914 |
|
|
|
1,879 |
|
|
3,476 |
|
JV
Income |
|
|
2,073 |
|
|
2,182 |
|
|
|
6,861 |
|
|
6,361 |
|
Service
Fees |
|
|
166 |
|
|
537 |
|
|
|
1,658 |
|
|
908 |
|
Investment Income |
|
$ |
18,574 |
|
|
19,009 |
|
|
$ |
58,527 |
|
$ |
50,997 |
|
Less: Purchase discount accounting |
|
$ |
(238 |
) |
$ |
(1,404 |
) |
|
$ |
(1,706 |
) |
$ |
(4,518 |
) |
Core Investment Income |
|
$ |
18,336 |
|
$ |
17,605 |
|
|
$ |
56,821 |
|
$ |
46,479 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Fair Value of Investments
The composition of our investment portfolio as
of September 30, 2023 and December 31, 2022 at cost and fair value
was as follows:
($ in
thousands) |
|
September 30,
2023(Unaudited) |
|
December 31, 2022 |
Security
Type |
|
Cost/AmortizedCost |
|
Fair Value |
|
%(3) |
|
Cost/AmortizedCost |
|
Fair Value |
|
%(3) |
Senior Secured Loan |
|
$ |
378,284 |
|
|
$ |
360,994 |
|
|
|
72 |
|
|
$ |
435,856 |
|
|
$ |
418,722 |
|
|
|
73 |
|
Junior
Secured Loan |
|
|
61,016 |
|
|
|
47,537 |
|
|
|
10 |
|
|
|
65,776 |
|
|
|
56,400 |
|
|
|
10 |
|
Senior
Unsecured Bond |
|
|
416 |
|
|
|
43 |
|
|
|
0 |
|
|
|
416 |
|
|
|
43 |
|
|
|
0 |
|
Equity
Securities |
|
|
29,667 |
|
|
|
19,189 |
|
|
|
4 |
|
|
|
28,848 |
|
|
|
21,905 |
|
|
|
4 |
|
CLO Fund
Securities |
|
|
21,868 |
|
|
|
10,425 |
|
|
|
2 |
|
|
|
34,649 |
|
|
|
20,453 |
|
|
|
3 |
|
Asset
Manager Affiliates(4) |
|
|
17,791 |
|
|
|
- |
|
|
|
- |
|
|
|
17,791 |
|
|
|
- |
|
|
|
- |
|
Joint
Ventures |
|
|
75,513 |
|
|
|
62,231 |
|
|
|
12 |
|
|
|
68,850 |
|
|
|
58,955 |
|
|
|
10 |
|
Derivatives |
|
|
31 |
|
|
|
- |
|
|
|
- |
|
|
|
31 |
|
|
|
- |
|
|
|
- |
|
Total |
|
$ |
584,586 |
|
|
$ |
500,419 |
|
|
|
100 |
% |
|
$ |
652,217 |
|
|
$ |
576,478 |
|
|
|
100 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
3Represents percentage of total portfolio at fair
value4Represents the equity investment in the Asset Manager
Affiliates
Liquidity and Capital
ResourcesAs of September 30, 2023, the Company had $321.5
million (par value) of borrowings outstanding at a current weighted
average interest rate of 6.9%, of which $108.0 million par value
had a fixed rate and $213.5 million par value had a floating rate.
This balance was comprised of $74.0 million of outstanding
borrowings under the Senior Secured Revolving Credit Facility,
$139.5 million of 2018-2 Secured Notes due 2029, and $108.0 million
of 4.875% Notes due 2026.
As of September 30, 2023 and December 31, 2022, the fair value
of investments and cash were as follows:
($ in
thousands) |
|
|
|
Security
Type |
|
September 30, 2023 |
|
December 31, 2022 |
Cash and cash equivalents |
|
$ |
14,896 |
|
|
$ |
5,148 |
|
Restricted Cash |
|
|
18,813 |
|
|
|
27,983 |
|
Senior
Secured Loan |
|
|
360,994 |
|
|
|
418,722 |
|
Junior
Secured Loan |
|
|
47,537 |
|
|
|
56,400 |
|
Senior
Unsecured Bond |
|
|
43 |
|
|
|
43 |
|
Equity
Securities |
|
|
19,189 |
|
|
|
21,905 |
|
CLO Fund
Securities |
|
|
10,425 |
|
|
|
20,453 |
|
Asset
Manager Affiliates |
|
|
- |
|
|
|
- |
|
Joint
Ventures |
|
|
62,231 |
|
|
|
58,955 |
|
Derivatives |
|
|
- |
|
|
|
- |
|
Total |
|
$ |
534,128 |
|
|
$ |
609,609 |
|
|
|
|
|
|
|
|
|
|
As of September 30, 2023, the Company had
unrestricted cash of $14.9 million and restricted cash of $18.8
million. This compares to unrestricted cash of $20.3 million and
restricted cash of $15.2 million as of June 30, 2023. As of
September 30, 2023, the Company had $41 million of available
borrowing capacity under the Senior Secured Revolving Credit
Facility, and no remaining borrowing capacity under the 2018-2
Secured Notes.
Interest Rate Risk
The Company’s investment income is affected by
fluctuations in various interest rates, including LIBOR, SOFR and
prime rates.
As of September 30, 2023, approximately 90.5% of
our Debt Securities Portfolio at par value were either floating
rate with a spread to an interest rate index such as LIBOR, SOFR or
the prime rate. 77.5% of these floating rate loans contain floors
ranging between 0.50% and 2.50%. We generally expect that future
portfolio investments will predominately be floating rate
investments.
In periods of rising or lowering interest rates,
the cost of the portion of debt associated with the 4.875% Notes
Due 2026 would remain the same, given that this debt is at a fixed
rate, while the interest rate on borrowings under the Revolving
Credit Facility would fluctuate with changes in interest rates.
Generally, the Company would expect that an
increase in the base rate index for floating rate investment assets
would increase gross investment income and a decrease in the base
rate index for such assets would decrease gross investment income
(in either case, such increase/decrease may be limited by interest
rate floors/minimums for certain investment assets).
|
|
Impact on net investment income froma
change in interest rates at: |
($ in
thousands) |
|
1% |
|
2% |
|
3% |
Increase in interest rate |
|
$ |
1,693 |
|
|
$ |
3,386 |
|
|
$ |
5,079 |
|
Decrease
in interest rate |
|
$ |
(1,693 |
) |
|
$ |
(3,386 |
) |
|
$ |
(5,079 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Conference Call and Webcast
We will hold a conference call on November 9,
2023, at 4:00 pm Eastern Time to discuss our third quarter 2023
financial results. To access the call, stockholders, prospective
stockholders and analysts should dial (646) 307-1963 approximately
10 minutes prior to the start of the conference call and use the
conference ID 9970193.
A live audio webcast of the conference call can
be accessed via the Internet, on a listen-only basis on the
Company’s website www.portmanridge.com in the Investor Relations
section under Events and Presentations. The webcast can also be
accessed by clicking the following link:
https://edge.media-server.com/mmc/p/zkkarccv. The online archive of
the webcast will be available on the Company’s website shortly
after the call.
About Portman Ridge Finance
Corporation
Portman Ridge Finance Corporation (Nasdaq: PTMN)
is a publicly traded, externally managed investment company that
has elected to be regulated as a business development company under
the Investment Company Act of 1940. Portman Ridge’s middle market
investment business originates, structures, finances and manages a
portfolio of term loans, mezzanine investments and selected equity
securities in middle market companies. Portman Ridge’s investment
activities are managed by its investment adviser, Sierra Crest
Investment Management LLC, an affiliate of BC Partners Advisors,
LP.
Portman Ridge’s filings with the Securities and
Exchange Commission (the “SEC”), earnings releases, press releases
and other financial, operational and governance information are
available on the Company's website at www.portmanridge.com.
About BC Partners Advisors L.P. and BC
Partners Credit
BC Partners is a leading international
investment firm with over €40 billion of assets under management in
private equity, private credit and real estate strategies.
Established in 1986, BC Partners has played an active role in
developing the European buyout market for three decades. Today, BC
Partners executives operate across markets as an integrated team
through the firm's offices in North America and Europe. Since
inception, BC Partners has completed 117 private equity investments
in companies with a total enterprise value of €149 billion and is
currently investing its eleventh private equity fund. For more
information, please visit https://www.bcpartners.com/.
BC Partners Credit was launched in February 2017
and has pursued a strategy focused on identifying attractive credit
opportunities in any market environment and across sectors,
leveraging the deal sourcing and infrastructure made available from
BC Partners.
Cautionary Statement Regarding
Forward-Looking Statements
This press release contains forward-looking
statements. The matters discussed in this press release, as well as
in future oral and written statements by management of Portman
Ridge Finance Corporation, that are forward-looking statements are
based on current management expectations that involve substantial
risks and uncertainties which could cause actual results to differ
materially from the results expressed in, or implied by, these
forward-looking statements.
Forward-looking statements relate to future
events or our future financial performance and include, but are not
limited to, projected financial performance, expected development
of the business, plans and expectations about future investments
and the future liquidity of the Company. We generally identify
forward-looking statements by terminology such as “may,” “will,”
“should,” “expects,” “plans,” “anticipates,” “could,” “intends,”
“target,” “projects,” “outlook”, “contemplates,” “believes,”
“estimates,” “predicts,” “potential” or “continue” or the negative
of these terms or other similar words. Forward-looking statements
are based upon current plans, estimates and expectations that are
subject to risks, uncertainties, and assumptions. Should one or
more of these risks or uncertainties materialize, or should
underlying assumptions prove to be incorrect, actual results may
vary materially from those indicated or anticipated by such
forward-looking statements.
Important assumptions include our ability to
originate new investments, and achieve certain margins and levels
of profitability, the availability of additional capital, and the
ability to maintain certain debt to asset ratios. In light of these
and other uncertainties, the inclusion of a projection or
forward-looking statement in this press release should not be
regarded as a representation that such plans, estimates,
expectations or objectives will be achieved. Important factors that
could cause actual results to differ materially from such plans,
estimates or expectations include, among others,
(1) uncertainty of the expected financial performance of the
Company; (2) expected synergies and savings associated with merger
transactions effectuated by the Company; (3) the ability of the
Company and/or its adviser to implement its business strategy;
(4) evolving legal, regulatory and tax regimes;
(5) changes in general economic and/or industry specific
conditions, including but not limited to the impact of inflation;
(6) the impact of increased competition; (7) business
prospects and the prospects of the Company’s portfolio companies;
(8) contractual arrangements with third parties; (9) any
future financings by the Company; (10) the ability of Sierra
Crest Investment Management LLC to attract and retain highly
talented professionals; (11) the Company’s ability to fund any
unfunded commitments; (12) any future distributions by the
Company; (13) changes in regional or national economic conditions,
including but not limited to the impact of the COVID-19 pandemic,
and their impact on the industries in which we invest; and (14)
other changes in the conditions of the industries in which we
invest and other factors enumerated in our filings with the SEC.
The forward-looking statements should be read in conjunction with
the risks and uncertainties discussed in the Company’s filings with
the SEC, including the Company’s most recent Form 10-K and other
SEC filings. We do not undertake to publicly update or revise any
forward-looking statements, whether as a result of new information,
future events or otherwise, except as required to be reported under
the rules and regulations of the SEC.
Contacts:Portman Ridge Finance
Corporation
650 Madison Avenue, 23rd floorNew York, NY
10022info@portmanridge.com
Jason Roos Jason.Roos@bcpartners.com(212)
891-2880
The Equity Group Inc.Lena
Catilcati@equityny.com(212) 836-9611
Val Ferrarovferraro@equityny.com(212)
836-9633
PORTMAN RIDGE FINANCE
CORPORATIONCONSOLIDATED BALANCE
SHEETS(in thousands, except share
and per share amounts)
|
September 30, 2023 |
|
|
December 31, 2022 |
|
|
(Unaudited) |
|
|
|
|
ASSETS |
|
|
|
|
|
Investments at fair value: |
|
|
|
|
|
Non-controlled/non-affiliated investments (amortized cost: 2023 -
$454,095; 2022 - $518,699) |
$ |
414,778 |
|
|
$ |
483,698 |
|
Non-controlled affiliated investments (amortized cost: 2023 -
$72,449; 2022 - $75,196) |
|
70,418 |
|
|
|
73,827 |
|
Controlled affiliated investments (cost: 2023 - $58,042; 2022 -
$58,322) |
|
15,223 |
|
|
|
18,953 |
|
Total
Investments at Fair Value (cost: 2023 - $584,586; 2022 -
$652,217) |
$ |
500,419 |
|
|
$ |
576,478 |
|
Cash and
cash equivalents |
|
14,896 |
|
|
|
5,148 |
|
Restricted cash |
|
18,813 |
|
|
|
27,983 |
|
Interest
receivable |
|
6,066 |
|
|
|
4,828 |
|
Receivable for unsettled trades |
|
1,361 |
|
|
|
1,395 |
|
Due from
affiliates |
|
1,460 |
|
|
|
930 |
|
Other
assets |
|
2,696 |
|
|
|
2,724 |
|
Total Assets |
$ |
545,711 |
|
|
$ |
619,486 |
|
LIABILITIES |
|
|
|
|
|
2018-2
Secured Notes (net of discount of: 2023 - $855; 2022 - $1,226) |
$ |
138,638 |
|
|
$ |
176,937 |
|
4.875%
Notes Due 2026 (net of discount of: 2023 - $1,346; 2022 - $1,704;
net of deferred financing costs of: 2023 - $628; 2022 - $818) |
|
106,026 |
|
|
|
105,478 |
|
Great
Lakes Portman Ridge Funding LLC Revolving Credit Facility (net of
deferred financing costs of: 2023 - $858; 2022 - $1,107) |
|
73,142 |
|
|
|
90,893 |
|
Payable
for unsettled trades |
|
- |
|
|
|
1,276 |
|
Accounts
payable, accrued expenses and other liabilities |
|
3,817 |
|
|
|
4,614 |
|
Accrued
interest payable |
|
4,949 |
|
|
|
3,722 |
|
Due to
affiliates |
|
1,021 |
|
|
|
900 |
|
Management and incentive fees payable |
|
3,363 |
|
|
|
3,543 |
|
Total Liabilities |
$ |
330,956 |
|
|
$ |
387,363 |
|
COMMITMENTS AND CONTINGENCIES (NOTE 8) |
|
|
|
|
|
NET ASSETS |
|
|
|
|
|
Common
stock, par value $0.01 per share, 20,000,000 common shares
authorized; 9,938,935 issued, and 9,480,362 outstanding at
September 30, 2023, and 9,916,856 issued, and 9,581,536
outstanding at December 31, 2022 |
$ |
95 |
|
|
$ |
96 |
|
Capital
in excess of par value |
|
734,659 |
|
|
|
736,784 |
|
Total
distributable (loss) earnings |
|
(519,999 |
) |
|
|
(504,757 |
) |
Total Net Assets |
$ |
214,755 |
|
|
$ |
232,123 |
|
Total Liabilities and Net Assets |
$ |
545,711 |
|
|
$ |
619,486 |
|
Net
Asset Value Per Common Share |
$ |
22.65 |
|
|
$ |
24.23 |
|
|
|
|
|
|
|
|
|
PORTMAN RIDGE FINANCE
CORPORATIONCONSOLIDATED STATEMENTS OF
OPERATIONS(in thousands, except
share and per share amounts)
|
|
For the Three Months Ended September 30, |
|
|
For the Nine Months Ended September 30, |
|
|
|
2023 |
|
|
2022 |
|
|
2023 |
|
|
2022 |
|
INVESTMENT INCOME |
|
|
|
|
|
|
|
|
|
|
|
|
Interest
income: |
|
|
|
|
|
|
|
|
|
|
|
|
Non-controlled/non-affiliated investments |
|
$ |
13,283 |
|
|
$ |
13,727 |
|
|
$ |
42,915 |
|
|
$ |
37,043 |
|
Non-controlled affiliated investments |
|
|
631 |
|
|
|
823 |
|
|
|
2,106 |
|
|
|
2,271 |
|
Total interest income |
|
$ |
13,914 |
|
|
$ |
14,550 |
|
|
$ |
45,021 |
|
|
$ |
39,314 |
|
Payment-in-kind income: |
|
|
|
|
|
|
|
|
|
|
|
|
Non-controlled/non-affiliated investments(1) |
|
$ |
2,308 |
|
|
$ |
1,505 |
|
|
$ |
4,694 |
|
|
$ |
3,830 |
|
Non-controlled affiliated investments |
|
|
113 |
|
|
|
74 |
|
|
|
293 |
|
|
|
403 |
|
Controlled affiliated investments |
|
|
- |
|
|
|
161 |
|
|
|
- |
|
|
|
181 |
|
Total payment-in-kind income |
|
$ |
2,421 |
|
|
$ |
1,740 |
|
|
$ |
4,987 |
|
|
$ |
4,414 |
|
Dividend
income: |
|
|
|
|
|
|
|
|
|
|
|
|
Non-controlled affiliated investments |
|
$ |
1,429 |
|
|
$ |
1,149 |
|
|
$ |
4,677 |
|
|
$ |
3,099 |
|
Controlled affiliated investments |
|
|
644 |
|
|
|
1,033 |
|
|
|
2,184 |
|
|
|
3,262 |
|
Total dividend income |
|
$ |
2,073 |
|
|
$ |
2,182 |
|
|
$ |
6,861 |
|
|
$ |
6,361 |
|
Fees and
other income |
|
|
|
|
|
|
|
|
|
|
|
|
Non-controlled/non-affiliated investments |
|
$ |
166 |
|
|
$ |
537 |
|
|
$ |
1,644 |
|
|
$ |
908 |
|
Non-controlled affiliated investments |
|
|
- |
|
|
|
- |
|
|
|
14 |
|
|
|
- |
|
Total fees and other income |
|
$ |
166 |
|
|
$ |
537 |
|
|
$ |
1,658 |
|
|
$ |
908 |
|
Total investment income |
|
$ |
18,574 |
|
|
$ |
19,009 |
|
|
$ |
58,527 |
|
|
$ |
50,997 |
|
EXPENSES |
|
|
|
|
|
|
|
|
|
|
|
|
Management fees |
|
$ |
1,844 |
|
|
$ |
2,082 |
|
|
$ |
5,666 |
|
|
$ |
6,305 |
|
Performance-based incentive fees |
|
|
1,519 |
|
|
|
1,780 |
|
|
|
5,007 |
|
|
|
4,627 |
|
Interest and amortization of debt issuance costs |
|
|
6,343 |
|
|
|
4,673 |
|
|
|
19,047 |
|
|
|
11,906 |
|
Professional fees |
|
|
640 |
|
|
|
759 |
|
|
|
1,942 |
|
|
|
2,483 |
|
Administrative services expense |
|
|
617 |
|
|
|
862 |
|
|
|
1,947 |
|
|
|
2,531 |
|
Other general and administrative expenses |
|
|
445 |
|
|
|
461 |
|
|
|
1,308 |
|
|
|
1,323 |
|
Total expenses |
|
$ |
11,408 |
|
|
$ |
10,617 |
|
|
$ |
34,917 |
|
|
$ |
29,175 |
|
NET INVESTMENT INCOME |
|
$ |
7,166 |
|
|
$ |
8,392 |
|
|
$ |
23,610 |
|
|
$ |
21,822 |
|
REALIZED AND UNREALIZED GAINS (LOSSES) ON
INVESTMENTS |
|
|
|
|
|
|
|
|
|
|
|
|
Net
realized gains (losses) from investment transactions: |
|
|
|
|
|
|
|
|
|
|
|
|
Non-controlled/non-affiliated investments |
|
$ |
(2,361 |
) |
|
$ |
(8,560 |
) |
|
$ |
(10,713 |
) |
|
$ |
(26,339 |
) |
Non-controlled affiliated investments |
|
|
725 |
|
|
|
(527 |
) |
|
|
(399 |
) |
|
|
(197 |
) |
Controlled affiliated investments |
|
|
- |
|
|
|
- |
|
|
|
(80 |
) |
|
|
- |
|
Derivatives |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
(2,095 |
) |
Net realized gain (loss) on investments |
|
$ |
(1,636 |
) |
|
$ |
(9,087 |
) |
|
$ |
(11,192 |
) |
|
$ |
(28,631 |
) |
Net
change in unrealized appreciation (depreciation) on: |
|
|
|
|
|
|
|
|
|
|
|
|
Non-controlled/non-affiliated investments |
|
$ |
4,219 |
|
|
$ |
(318 |
) |
|
$ |
(4,316 |
) |
|
$ |
5,381 |
|
Non-controlled affiliated investments |
|
|
(1,117 |
) |
|
|
338 |
|
|
|
(662 |
) |
|
|
(874 |
) |
Controlled affiliated investments |
|
|
(1,394 |
) |
|
|
(2,988 |
) |
|
|
(3,450 |
) |
|
|
(7,661 |
) |
Derivatives |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
2,442 |
|
Net unrealized gain (loss) on investments |
|
$ |
1,708 |
|
|
$ |
(2,968 |
) |
|
$ |
(8,428 |
) |
|
$ |
(712 |
) |
Tax
(provision) benefit on realized and unrealized gains (losses) on
investments |
|
$ |
264 |
|
|
$ |
(542 |
) |
|
$ |
671 |
|
|
$ |
(1,059 |
) |
Net realized and unrealized appreciation (depreciation) on
investments, net of taxes |
|
$ |
336 |
|
|
$ |
(12,597 |
) |
|
$ |
(18,949 |
) |
|
$ |
(30,402 |
) |
Realized
gains (losses) on extinguishments of debt |
|
$ |
(57 |
) |
|
$ |
- |
|
|
$ |
(275 |
) |
|
$ |
- |
|
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM
OPERATIONS |
|
$ |
7,445 |
|
|
$ |
(4,205 |
) |
|
$ |
4,386 |
|
|
$ |
(8,580 |
) |
Net Increase (Decrease) In Net Assets Resulting from Operations per
Common Share: |
|
|
|
|
|
|
|
|
|
|
|
|
Basic and Diluted: |
|
$ |
0.78 |
|
|
$ |
(0.44 |
) |
|
$ |
0.46 |
|
|
$ |
(0.89 |
) |
Net Investment Income Per Common Share: |
|
|
|
|
|
|
|
|
|
|
|
|
Basic and Diluted: |
|
$ |
0.75 |
|
|
$ |
0.87 |
|
|
$ |
2.48 |
|
|
$ |
2.26 |
|
Weighted Average Shares of Common Stock Outstanding—Basic and
Diluted |
|
|
9,505,172 |
|
|
|
9,602,712 |
|
|
|
9,533,835 |
|
|
|
9,644,870 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) During the three and nine months ended September 30, 2023,
the Company received $117.8 thousand and $610.2 thousand,
respectively of non-recurring fee income that was paid in-kind and
included in this financial statement line item.
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