SuRo Capital Corp. (“SuRo Capital”, the
“Company”, “we”, “us”, and “our”) (Nasdaq:
SSSS) today provided the following preliminary
update on its investment portfolio for the second quarter ended
June 30, 2022.
“Equity market performance in the first half of
2022 was the worst first half performance in over 50 years. While
we exited a significant portion of our portfolio in 2021 and have
maintained over 40% of our investable assets in cash, we also
experienced a challenging quarter. Based on information presently
available, for the quarter ended June 30, 2022, we anticipate SuRo
Capital’s net asset value to be approximately $9.00 to $9.50 per
share,” said Mark Klein, Chairman and Chief Executive Officer of
SuRo Capital. SuRo Capital’s net asset value was $12.22 per share
as of March 31, 2022 and $16.56 per share as of June 30, 2021.
Klein continued, “However, the macroeconomic
challenges that led to these broader market declines have also
provided a robust pipeline of primary and secondary investment
opportunities. We are seeing private companies seeking primary
financing at flat or discounted prices and private shareholders
approaching us for secondary sales at discounted rates to recent
financing rounds. To that end, during the second quarter, we added
two new companies to our investment portfolio: Whoop, Inc. and EDGE
Markets, Inc. (via SuRo Capital Sports LLC). We also made a
follow-on investment in Shogun Enterprises, Inc. (d/b/a Hearth).
With over $150.0 million in investable capital at quarter end, we
remain confident and opportunistic in seeking out compelling,
high-growth companies.”
“As we have consistently demonstrated, SuRo
Capital is committed to initiatives that enhance shareholder value
and we believe the market is currently undervaluing our portfolio.
Accordingly, in March, our Board of Directors authorized an
additional $15.0 million for share repurchases. Since that
increase, we have repurchased over 1 million shares for
approximately $8.3 million. Given the significant discount at which
our stock is trading compared to net asset value, coupled with the
extreme market volatility, we determined the current continuation
of the Share Repurchase Program to be an efficient and accretive
deployment of capital,” Klein concluded.
As previously reported, SuRo Capital’s net
assets totaled approximately $380.7 million, or $12.22 per share,
at March 31, 2022 and approximately $439.6 million, or $16.56 per
share, at June 30, 2021. As of June 30, 2022, SuRo Capital’s net
asset value is estimated to be between $9.00 and $9.50 per share.
This range includes a customary discount to the quarter-end pricing
of public shares subject to certain lock-up provisions at
quarter-end.
As of June 30, 2022, there were 30,325,187
shares of the Company’s common stock outstanding.
Investment Portfolio Update
At June 30, 2022, SuRo Capital held positions in
40 portfolio companies – 32 privately-held and 8 publicly-held,
some of which may be subject to certain lock-up provisions.
During the three months ended June 30, 2022,
SuRo Capital made the following investments:
Portfolio Company |
Investment |
Transaction Date |
Amount |
Shogun
Enterprises, Inc. (d/b/a Hearth) |
Convertible Note |
5/2/2022 |
$0.5 million(1) |
EDGE Markets,
Inc. |
Series Seed Preferred |
5/18/2022 |
$0.5 million(2) |
Whoop, Inc. |
Series C Preferred |
6/30/2022 |
$10.0 million(3) |
|
___________________ |
|
(1) |
Represents a follow-on investment. |
|
(2) |
Investment made through SuRo
Capital Sports, LLC. |
|
(3) |
Completed as a secondary
transaction. |
During the three months ended June 30, 2022,
SuRo Capital exited or received proceeds from the following
investments:
Portfolio Company |
Transaction Date |
Shares Sold |
Average Net Share Price(1) |
Net Proceeds |
|
Realized Gain/(Loss) |
New Lake Capital Partners,
Inc.(2) |
Various |
3,676 |
$21.02 |
$0.1 million |
|
<$0.1 million |
Rent the Runway, Inc.(3) |
Various |
50,000 |
$3.62 |
$0.2 million |
|
($0.6 million) |
Residential Homes For Rent,
LLC (d/b/a Second Avenue) |
Various |
N/A |
N/A |
$0.3 million(4) |
|
$-(4) |
Rover Group, Inc.(5) |
Various |
431,591 |
$5.52 |
$2.4 million |
|
$1.1 million |
True Global Ventures 4 Plus
Pte Ltd |
5/31/22 |
-- |
-- |
$0.9 million |
|
$0.2 million |
|
___________________ |
|
(1) |
The average net share price is the net share price realized after
deducting all commissions and fees on the sale(s), if
applicable |
|
(2) |
As of June 30, 2022, SuRo Capital
held 247,443 remaining NLCP public common shares. |
|
(3) |
As of June 30, 2022, SuRo Capital
held 289,191 remaining RENT public common shares. |
|
(4) |
During the three months ended
June 30, 2022, approximately $0.3 million was received from
Residential Homes For Rent, LLC (d/b/a Second Avenue) related to
the 15% term loan due December 23, 2023. Of the proceeds received,
approximately $0.3 million repaid a portion of the outstanding
principal and the remaining was attributed to interest. |
|
(5) |
As of June 30, 2022, SuRo Capital
held 364,046 remaining ROVR public common shares. |
Subsequent to quarter-end, through July 8, 2022,
SuRo Capital exited or received proceeds from the following
investments:
Portfolio Company |
Transaction Date |
Shares Sold |
Average Net Share Price(1) |
Net Proceeds |
|
Realized Gain/(Loss) |
Enjoy Technology, Inc.(2) |
Various |
626,955 |
$0.38 |
$0.2 million |
|
($3.0 million) |
Rent the Runway, Inc.(3) |
Various |
15,000 |
$3.43 |
$0.1 million |
|
($0.2 million) |
Rover Group, Inc.(4) |
Various |
70,000 |
$3.93 |
$0.3 million |
|
$0.1 million |
|
__________________ |
|
(1) |
The average net share price is the net share price realized after
deducting all commissions and fees on the sale(s), if
applicable. |
|
(2) |
As of July 8, 2022, SuRo Capital
held 320,342 remaining ENJY public common shares. |
|
(3) |
As of July 8, 2022, SuRo Capital
held 274,191 remaining RENT public common shares. |
|
(4) |
As of July 8, 2022, SuRo Capital
held 294,046 remaining ROVR public common shares. |
Share Repurchase Program
Since inception of the Share Repurchase Program
in August 2017, SuRo Capital has repurchased over 5.8 million
shares of its common stock for an aggregate purchase price of
approximately $38.6 million.
On March 13, 2022, the Company’s Board of
Directors authorized a $15.0 million expansion of the Share
Repurchase Program to $55.0 million. During the quarter ended June
30, 2022, under the Share Repurchase Program, the Company
repurchased 855,159 shares of its common stock for approximately
$6.9 million. The dollar value of shares that may yet be purchased
by the Company under the Share Repurchase Program is approximately
$16.4 million. The Share Repurchase Program is authorized through
October 31, 2022.
Under the Share Repurchase Program, the Company
may repurchase its outstanding common stock in the open market
provided it complies with the prohibitions under its insider
trading policies and procedures and the applicable provisions of
the Investment Company Act of 1940, as amended, and the Securities
Exchange Act of 1934, as amended.
Preliminary Estimates and
Guidance
The preliminary financial estimates provided
herein are unaudited and have been prepared by, and are the
responsibility of, the management of SuRo Capital. Neither our
independent registered public accounting firm, nor any other
independent accountants, have audited, reviewed, compiled, or
performed any procedures with respect to the preliminary financial
data included herein. Actual results may differ materially.
The Company expects to announce its second
quarter results in early August 2022.
Forward-Looking Statements
Statements included herein, including statements
regarding SuRo Capital's beliefs, expectations, intentions, or
strategies for the future, may constitute "forward-looking
statements". SuRo Capital cautions you that forward-looking
statements are not guarantees of future performance and that actual
results or developments may differ materially from those projected
or implied in these statements. All forward-looking statements
involve a number of risks and uncertainties, including the impact
of the COVID-19 pandemic and any market volatility that may be
detrimental to our business, our portfolio companies, our industry,
and the global economy, that could cause actual results to differ
materially from the plans, intentions, and expectations reflected
in or suggested by the forward-looking statements. Risk factors,
cautionary statements, and other conditions which could cause SuRo
Capital's actual results to differ from management's current
expectations are contained in SuRo Capital's filings with the
Securities and Exchange Commission. SuRo Capital undertakes no
obligation to update any forward-looking statement to reflect
events or circumstances that may arise after the date of this press
release.
About SuRo Capital Corp.
SuRo Capital Corp. (Nasdaq: SSSS) is a publicly
traded investment fund that seeks to invest in high-growth,
venture-backed private companies. The fund seeks to create a
portfolio of high-growth emerging private companies via a
repeatable and disciplined investment approach, as well as to
provide investors with access to such companies through its
publicly traded common stock. SuRo Capital is headquartered in New
York, NY and has offices in San Francisco, CA. Connect with the
company on Twitter, LinkedIn, and at www.surocap.com.
ContactSuRo Capital Corp.(650)
235-4769IR@surocap.com
Media ContactBill
DouglassGotham Communications, LLCCommunications@surocap.com
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