Stellus Private Credit BDC Reports Results for its Second Fiscal Quarter Ended June 30, 2024
HOUSTON, Aug. 9, 2024 /PRNewswire/ -- Stellus Private Credit BDC ("Stellus PBDC" or the "Company") today announced financial results for its second fiscal quarter ended June 30, 2024.
Robert T. Ladd, Chief Executive Officer of Stellus PBDC, stated "We are pleased to report strong results in the second quarter in which we generated $0.46 per share of net investment income and maintained a stable net asset value. During the quarter, we funded $42 million of investments and received $4 million of repayments, bringing the total portfolio to $254 million at fair value. On June 26, 2024, we declared our 2024 third quarter monthly dividend of $0.50 per share in the aggregate, which represents an annualized dividend yield of approximately 13%."
FINANCIAL HIGHLIGHTS | ||||||||||||
($ 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 | $3.86 | $0.46 | $2.68 | $0.44 | $7.42 | $0.95 | $5.33 | $0.92 | ||||
Net unrealized gain (loss) included in earnings | (0.41) | (0.05) | 1.83 | 0.31 | (0.09) | (0.01) | 1.76 | 0.30 | ||||
Benefit (provision) for taxes on net unrealized depreciation (appreciation) on investments | (0.04) | — | — | — | 0.01 | — | — | — | ||||
Net increase in net assets resulting from operations | $3.41 | $0.41 | $4.51 | $0.75 | 7.34 | 0.94 | 7.09 | 1.23 | ||||
Distributions | (4.08) | (0.49) | (2.72) | (0.45) | (7.69) | (0.99) | (5.03) | (0.87) | ||||
Other weighted average share adjustments(1) | — | 0.01 | — | — | — | 0.03 | — | (0.01) | ||||
Net asset value | 142.6 | $15.19 | 92.6 | $14.98 | 142.6 | $15.19 | 92.6 | $14.98 | ||||
Weighted average shares outstanding | 8,310,559 | 6,037,036 | 7,768,883 | 5,770,879 | ||||||||
(1) | Includes the impact of different share amounts as a result of calculating certain per share data based on weighted average shares outstanding during the period and certain per share data based on shares outstanding as of the period end. | ||||||
PORTFOLIO ACTIVITY | ||||
($ in millions) | ||||
As of | As of | |||
June 30, 2024 | December 31, 2023 | |||
Investments at fair value | $254.2 | $208.6 | ||
Total assets | $257.3 | $211.2 | ||
Net assets | $142.6 | $108.0 | ||
Shares outstanding | 9,390,537 | 7,102,136 | ||
Net asset value per share | $15.19 | $15.21 | ||
Three Months Ended | ||||
June 30, 2024 | June 30, 2023 | |||
New investments | $41.6 | $24.4 | ||
Repayments of investments | (3.7) | (2.8) | ||
Net activity | $37.9 | $21.6 | ||
As of | As of | |||
June 30, 2024 | December 31, 2023 | |||
Number of portfolio company investments | 49 | 39 | ||
Number of debt investments | 47 | 37 | ||
Weight average yield of debt and other income producing investments (2) | ||||
Cash | 11.6 % | 11.8 % | ||
Payment-in-kind ("PIK") | 0.3 % | 0.3 % | ||
Fee amortization | 0.4 % | 0.4 % | ||
Total | 12.3 % | 12.5 % | ||
Weighted average yield on total investments (3) | ||||
Cash | 11.0 % | 11.2 % | ||
Payment-in-kind ("PIK") | 0.3 % | 0.3 % | ||
Fee amortization | 0.4 % | 0.4 % | ||
Total | 11.7 % | 11.9 % | ||
(2) | 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 of our common stock would realize in a return over the same period because the dollar-weighted average annualized yield does not reflect the Company's expense or any sales load that may be paid by investors. | ||||||
(3) | 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 the three months ended June 30, 2024 and 2023 totaled $6.9 million and $5.2 million, respectively, most of which was interest income from portfolio investments.
Gross operating expenses for the three months ended June 30, 2024 and 2023 totaled $4.2 million and $3.5 million, respectively. For the same periods, base management fees totaled $0.8 million and $0.7 million, income incentive fees totaled $0.6 million and $0.5 million, capital gains incentive (reversal) fees of less than ($0.1) million and $0.1 million, which are not currently payable, fees and expenses related to our borrowings totaled $2.3 million and $1.8 million, respectively (including interest and amortization of deferred financing costs), administrative expenses totaled $0.1 million and $0.1 million, and other expenses totaled $0.3 million for both periods. For the three months ended June 30, 2024 and 2023, the Company's investment advisor, Stellus Private BDC Advisor, LLC (the "Advisor"), waived $0.8 million and $0.7 million of management fees (voluntarily waived until October 1, 2024), $0.2 million and $0.2 million of income incentive fees (waived as our shares were not listed on a national exchange), and $0.1 million and $0.1 million of expenses pursuant to expense support and conditional reimbursements from the Advisor for net operating expenses of $3.1 million and $2.5 million, respectively.
For the three months ended June 30, 2024 and 2023, net investment income was $3.9 million and $2.7 million, or $0.46 and $0.44 per common share based on weighted average common shares outstanding of 8,310,559 and 6,037,036, respectively.
The Company's investment portfolio had a net change in unrealized (depreciation) appreciation of ($0.4) million and $1.8 million for the three months ended June 30, 2024 and 2023, respectively.
For the three months ended June 30, 2024 and 2023, net increase in net assets resulting from operations totaled $3.4 million and $4.5 million, or $0.41 and $0.75 per common share, based on weighted average common shares outstanding of 8,310,559 and 6,037,036, respectively.
Liquidity and Capital Resources
On September 30, 2022, the Company entered into a senior secured revolving credit agreement with Zions Bancorporation, N.A., dba Amegy Bank and various other lenders (the "Credit Facility"). The Credit Facility, as amended, provides for borrowings up to a maximum of $150.0 million on a committed basis with an accordion feature that allows the Company to increase the aggregate commitments up to $200.0 million, subject to new or existing lenders agreeing to participate in the increase and other customary conditions. As of June 30, 2024 and December 31, 2023, the Company had $113.0 million and $98.0 million in outstanding borrowings under the Credit Facility.
Recent Portfolio Activity
The Company invested in the following portfolio companies for 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 | $ | 3,084,350 | Senior Secured – First Lien | |||||
$ | 1,079,522 | Delayed Draw Term Loan Commitment | |||||||||
$ | 462,652 | Revolver Commitment | |||||||||
$ | 115,663 | Equity | |||||||||
New Investment | April 11, 2024 | WER Holdings, LLC | Regional provider of commercial landscaping services | $ | 1,099,727 | Senior Secured – First Lien | |||||
$ | 544,419 | Delayed Draw Term Loan Commitment | |||||||||
$ | 163,326 | Revolver Commitment | |||||||||
$ | 73,300 | Equity | |||||||||
Add-On Investment | April 16, 2024 | Impact Home Services LLC* | Residential garage door, electrical, and plumbing services provider | $ | 5,055 | Equity | |||||
New Investment | May 10, 2024 | Luxium Solutions, LLC | Manufacturer and distributor of high-performance advanced materials and assemblies | $ | 3,372,885 | Senior Secured – First Lien | |||||
$ | 488,117 | Delayed Draw Term Loan Commitment | |||||||||
Add-On Investment | May 16, 2024 | Impact Home Services LLC* | Residential garage door, electrical, and plumbing services provider | $ | 2,527 | Equity | |||||
New Investment | May 24, 2024 | Teckrez, LLC | Distributor of tackifier resins and acrylic monomers | $ | 1,755,164 | Senior Secured – First Lien | |||||
$ | 586,521 | Revolver Commitment | |||||||||
$ | 36,658 | Equity | |||||||||
New Investment | May 28, 2024 | FiscalNote Boards LLC* | Facilitator of executive-level in-person events and remote peer-to-peer industry insights | $ | 77,109 | Equity | |||||
New Investment | May 31, 2024 | TriplePoint Acquisition Holdings LLC | Provider of HVAC, plumbing, and other mechanical and industrial services | $ | 4,246,034 | Senior Secured – First Lien | |||||
$ | 1,061,509 | Delayed Draw Term Loan Commitment | |||||||||
$ | 589,727 | Revolver Commitment | |||||||||
$ | 442,295 | Equity | |||||||||
New Investment | June 6, 2024 | Monarch Behavioral Therapy, LLC | Provider of center-based applied behavioral analysis therapy services | $ | 5,261,383 | Senior Secured – First Lien | |||||
$ | 843,170 | Delayed Draw Term Loan Commitment | |||||||||
$ | 562,114 | Revolver Commitment | |||||||||
$ | 333,333 | Equity | |||||||||
Add-On Investment | June 6, 2024 | Impact Home Services LLC* | Residential garage door, electrical, and plumbing services provider | $ | 1,264 | Equity | |||||
New Investment | June 13, 2024 | Said Intermediate, LLC | Digital transformation consulting firm | $ | 5,818,182 | Senior Secured – First Lien | |||||
$ | 909,091 | Revolver Commitment | |||||||||
$ | 272,727 | Equity | |||||||||
New Investment | June 24, 2024 | AGT Robotique, Inc. | Manufacturer of robotic welding solutions for metal fabrication industry | $ | 8,503,125 | Senior Secured – First Lien | |||||
$ | 1,210,120 | Revolver Commitment | |||||||||
* | Existing portfolio company |
Events Subsequent to June 30, 2024
The Company's management has evaluated subsequent events through August 9, 2024. There have been no subsequent events that require recognition or disclosure except for the following described below.
Credit Facilities
On August 1, 2024, the Company entered into a Loan Financing and Servicing Agreement (the "Loan Agreement") for a special purpose vehicle financing credit facility (the "SPV Facility") by and among Stellus Private Credit BDC SPV LLC ("Stellus SPV"), as borrower, the Company, as equityholder and servicer, Deutsche Bank AG, New York Branch ("Deutsche Bank"), as facility agent, Citibank, N.A., as collateral agent and collateral custodian, Alter Domus (US) LLC, as collateral administrator, and the lenders that are party thereto from time to time. The SPV Facility provides for $50 million of initial commitments with an accordion feature that allows for an additional $50 million of total commitments from new and existing lenders on the same terms and conditions as the existing commitments. Advances under the SPV Facility bear interest at three-month Term SOFR (as defined in the Loan Agreement) plus an applicable margin of 2.50% during the revolving period ending on August 1, 2027 and three-month Term SOFR plus an applicable margin of 2.85% thereafter. The Loan Agreement provides for an unused commitment fee, from the effective date of the Loan Agreement through August 1, 2027, of 0.25% per annum on the unused commitments if Stellus SPV's credit facility utilization is greater than or equal to 80%, and otherwise, 0.50% per annum on the unused commitments, and other customary fees. The SPV Facility will mature on August 1, 2030.
The outstanding balance under the Credit Facility and SPV Facility as of August 9, 2024 was $63.2 million and $50.0 million, respectively.
Distributions Declared
On June 26, 2024, our Board of Directors declared a regular monthly distribution for each of July 2024, August 2024, and September 2024, as follows:
Record | Payment | Amount per | |||||
Declared | Date | Date | Share | ||||
6/26/2024 | 7/1/2024 | 7/31/2024 | $ | 0.1666 | |||
6/26/2024 | 8/1/2024 | 8/30/2024 | $ | 0.1666 | |||
6/26/2024 | 9/2/2024 | 9/30/2024 | $ | 0.1666 | |||
Sale of Unregistered Securities
Since June 30, 2024, the Company sold 104,924 common shares of beneficial interest at a price of $15.19 per share for aggregate proceeds of $1.6 million, which included less than $0.1 million of organizational expense allocation pursuant to subscription agreements entered into between the Company and investors.
Since June 30, 2024, the Company also issued 8,014 common shares of beneficial interest for aggregate proceeds of $0.1 million under the DRIP.
About Stellus Private Credit BDC
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 and second lien loans, with corresponding equity co-investments. The Company's investment activities are managed by its investment adviser, Stellus Private BDC Advisor, LLC.
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 Private Credit BDC
W. Todd Huskinson, Chief Financial Officer
(713) 292-5414
[email protected]
STELLUS PRIVATE CREDIT BDC CONSOLIDATED STATEMENTS OF ASSETS AND LIABILITIES | ||||||
June 30, 2024 | ||||||
(unaudited) | December 31, 2023 | |||||
ASSETS | ||||||
Non-controlled, non-affiliated investments, at fair value (amortized cost of $252,191,163 and $206,513,758, respectively) | $ | 254,154,676 | $ | 208,574,078 | ||
Cash and cash equivalents | 565,106 | 593,685 | ||||
Interest receivable | 1,918,469 | 1,495,581 | ||||
Expense reimbursement receivable from the Advisor (Note 2) | 77,042 | 126,539 | ||||
Deferred offering costs | 105,843 | 72,875 | ||||
Related party receivable | 113,666 | 162,455 | ||||
Prepaid expenses | 84,493 | 127,019 | ||||
Receivable for sales and repayments of investments | 121,092 | 71,105 | ||||
Total Assets | $ | 257,263,779 | $ | 211,223,337 | ||
LIABILITIES | ||||||
Credit Facilities payable | $ | 112,219,734 | $ | 97,031,517 | ||
Dividends payable | — | 3,551,068 | ||||
Unearned revenue | 801,369 | 897,538 | ||||
Income incentive fee payable | 445,911 | 439,854 | ||||
Capital gains incentive fee payable | 291,758 | 261,684 | ||||
Interest payable | 334,536 | 367,093 | ||||
Administrative services payable | 131,543 | 124,958 | ||||
Income tax payable | 51,769 | 182,489 | ||||
Deferred tax liability | 164,066 | 167,865 | ||||
Other accrued expenses and liabilities | 190,207 | 177,249 | ||||
Total Liabilities | $ | 114,630,893 | $ | 103,201,315 | ||
Commitments and contingencies (Note 7) | ||||||
Net Assets | $ | 142,632,886 | $ | 108,022,022 | ||
NET ASSETS | ||||||
Common shares of beneficial interest, par value $0.01 per share (unlimited shares authorized; 9,390,537 and 7,102,136 issued and outstanding, respectively) | $ | 93,905 | $ | 71,021 | ||
Paid-in capital | 139,747,341 | 104,810,048 | ||||
Total distributable earnings | 2,791,640 | 3,140,953 | ||||
Net Assets | $ | 142,632,886 | $ | 108,022,022 | ||
Total Liabilities and Net Assets | $ | 257,263,779 | $ | 211,223,337 | ||
Net Asset Value Per Share | $ | 15.19 | $ | 15.21 | ||
STELLUS PRIVATE CREDIT BDC CONSOLIDATED STATEMENTS OF OPERATIONS (unaudited) | ||||||||||||
Three Months Ended | Six Months Ended | |||||||||||
June 30, 2024 | June 30, 2023 | June 30, 2024 | June 30, 2023 | |||||||||
INVESTMENT INCOME | ||||||||||||
Interest income | $ | 6,844,595 | $ | 5,158,773 | $ | 13,153,976 | $ | 9,890,725 | ||||
Other income | 86,125 | 62,484 | 195,721 | 238,553 | ||||||||
Total Investment Income | $ | 6,930,720 | $ | 5,221,257 | $ | 13,349,697 | $ | 10,129,278 | ||||
OPERATING EXPENSES | ||||||||||||
Management fees | $ | 800,653 | $ | 666,721 | $ | 1,601,307 | $ | 1,268,560 | ||||
Income incentive fees | 642,470 | 468,011 | 1,240,871 | 907,677 | ||||||||
Capital gains incentive (reversal) fee | (7,817) | 124,892 | 30,074 | 124,892 | ||||||||
Professional fees | 128,021 | 168,703 | 324,932 | 380,511 | ||||||||
Organization costs | — | — | — | 1,000 | ||||||||
Amortization of deferred offering costs | 48,654 | 41,106 | 95,382 | 98,729 | ||||||||
Administrative services expenses | 122,272 | 100,914 | 244,049 | 194,674 | ||||||||
Trustees' fees | 40,000 | 40,000 | 80,000 | 80,000 | ||||||||
Insurance expense | 20,197 | 20,307 | 40,393 | 40,391 | ||||||||
Valuation fees | 1,559 | 615 | 28,718 | 18,274 | ||||||||
Interest expense and other fees | 2,278,332 | 1,822,407 | 4,388,451 | 3,525,910 | ||||||||
Income tax expense | 7,685 | 8,855 | 29,274 | 16,690 | ||||||||
Other general and administrative expenses | 77,912 | 37,503 | 120,845 | 81,023 | ||||||||
Total Operating Expenses | $ | 4,159,938 | $ | 3,500,034 | $ | 8,224,296 | $ | 6,738,331 | ||||
Expenses reimbursed/fees waived by Investment Advisor (Note 2) | $ | (1,091,852) | $ | (961,954) | $ | (2,289,748) | $ | (1,930,229) | ||||
Net Operating Expenses | $ | 3,068,086 | $ | 2,538,080 | $ | 5,934,548 | $ | 4,808,102 | ||||
Net Investment Income | $ | 3,862,634 | $ | 2,683,177 | $ | 7,415,149 | $ | 5,321,176 | ||||
Net realized gain on foreign currency translation | $ | 6,403 | $ | 7,846 | 14,845 | 11,321 | ||||||
Net change in unrealized (depreciation) appreciation on non-controlled, non-affiliated investments | (417,099) | 1,819,403 | (83,638) | 1,747,377 | ||||||||
Net change in unrealized depreciation on foreign currency translations | (4,288) | (27) | (13,169) | 6,193 | ||||||||
(Provision) benefit for taxes on net unrealized (gain) loss on investments | (42,087) | — | 3,798 | — | ||||||||
Net Increase in Net Assets Resulting from Operations | $ | 3,405,563 | $ | 4,510,399 | $ | 7,336,985 | $ | 7,086,067 | ||||
Net Investment Income Per Share – basic and diluted | $ | 0.46 | $ | 0.44 | $ | 0.95 | $ | 0.92 | ||||
Net Increase in Net Assets Resulting from Operations Per Share – basic and diluted | $ | 0.41 | $ | 0.75 | $ | 0.94 | $ | 1.23 | ||||
Weighted Average Common Shares of Beneficial Interest Outstanding – basic and diluted | 8,310,559 | 6,037,036 | 7,768,883 | 5,770,879 | ||||||||
Distributions Per Share – basic and diluted | $ | 0.49 | $ | 0.45 | $ | 0.99 | $ | 0.87 | ||||
STELLUS PRIVATE CREDIT BDC CONSOLIDATED STATEMENTS OF CHANGES IN NET ASSETS (unaudited) | ||||||||||||||
Common Shares of | ||||||||||||||
Beneficial Interest | Total | |||||||||||||
Number of | Par | Paid-in | distributable | |||||||||||
shares | value | capital | (loss) gain | Net Assets | ||||||||||
Balances at December 31, 2022 | 5,483,433 | $ | 54,834 | $ | 80,950,845 | $ | (742,722) | $ | 80,262,957 | |||||
Net investment income | — | — | — | 2,637,999 | 2,637,999 | |||||||||
Net realized gain on foreign currency translation | — | — | — | 3,475 | 3,475 | |||||||||
Net change in unrealized depreciation on non-controlled, non-affiliated investments | — | — | — | (72,026) | (72,026) | |||||||||
Net change in unrealized appreciation on foreign currency translations | — | — | — | 6,220 | 6,220 | |||||||||
Distributions from net investment income | — | — | — | (2,306,409) | (2,306,409) | |||||||||
Issuance of common shares of beneficial interest | 349,546 | 3,496 | 5,115,958 | — | 5,119,454 | |||||||||
Balances at March 31, 2023 | 5,832,979 | $ | 58,330 | $ | 86,066,803 | $ | (473,463) | $ | 85,651,670 | |||||
Net investment income | — | — | — | 2,683,177 | 2,683,177 | |||||||||
Net realized gain on foreign currency translation | — | — | — | 7,846 | 7,846 | |||||||||
Net change in unrealized appreciation on non-controlled, non-affiliated investments | — | — | — | 1,819,403 | 1,819,403 | |||||||||
Net change in unrealized depreciation on foreign currency translation | — | — | — | (27) | (27) | |||||||||
Distributions from net investment income | — | — | — | (2,720,486) | (2,720,486) | |||||||||
Issuance of common shares of beneficial interest | 349,945 | 3,499 | 5,152,116 | — | 5,155,615 | |||||||||
Balances at June 30, 2023 | 6,182,924 | $ | 61,829 | $ | 91,218,919 | $ | 1,316,450 | $ | 92,597,198 | |||||
Balances at December 31, 2023 | 7,102,136 | $ | 71,021 | $ | 104,810,048 | $ | 3,140,953 | $ | 108,022,022 | |||||
Net investment income | — | — | — | 3,552,515 | 3,552,515 | |||||||||
Net realized gain on foreign currency translation | — | — | — | 8,442 | 8,442 | |||||||||
Net change in unrealized appreciation on non-controlled, non-affiliated investments | — | — | — | 333,461 | 333,461 | |||||||||
Net change in unrealized depreciation on foreign currency translations | — | — | — | (8,881) | (8,881) | |||||||||
Benefit for taxes on net unrealized loss on investments | — | — | — | 45,885 | 45,885 | |||||||||
Distributions from net investment income | — | — | — | (3,610,362) | (3,610,362) | |||||||||
Issuance of common shares of beneficial interest | 255,902 | 2,559 | 3,901,680 | — | 3,904,239 | |||||||||
Balances at March 31, 2024 | 7,358,038 | $ | 73,580 | $ | 108,711,728 | $ | 3,462,013 | $ | 112,247,321 | |||||
Net investment income | — | — | — | 3,862,634 | 3,862,634 | |||||||||
Net realized gain on foreign currency translation | — | — | — | 6,403 | 6,403 | |||||||||
Net change in unrealized depreciation on non-controlled, non-affiliated investments | — | — | — | (417,099) | (417,099) | |||||||||
Net change in unrealized depreciation on foreign currency translations | — | — | — | (4,288) | (4,288) | |||||||||
Provision for taxes on net unrealized gain on investments | — | — | — | (42,087) | (42,087) | |||||||||
Distributions from net investment income | — | — | — | (4,075,936) | (4,075,936) | |||||||||
Issuance of common shares of beneficial interest | 2,032,499 | 20,325 | 31,035,613 | — | 31,055,938 | |||||||||
Balances at June 30, 2024 | 9,390,537 | $ | 93,905 | $ | 139,747,341 | $ | 2,791,640 | $ | 142,632,886 | |||||
STELLUS PRIVATE CREDIT BDC CONSOLIDATED STATEMENTS OF CASH FLOWS (unaudited) | |||||
Six Months Ended | |||||
June 30, 2024 | June 30, 2023 | ||||
Cash Flows from Operating Activities | |||||
Net increase in net assets resulting from operations | $ | 7,336,985 | $ | 7,086,067 | |
Adjustments to reconcile net increase in net assets from operations to net cash used in operating activities: | |||||
Purchases of investments | (58,123,495) | (41,418,778) | |||
Proceeds from sales and repayments of investments | 13,029,056 | 12,580,637 | |||
Net change in unrealized depreciation (appreciation) on investments | 83,638 | (1,747,377) | |||
Net change in unrealized depreciation (appreciation) foreign currency translations | 13,169 | (6,193) | |||
Increase in investments due to PIK | (333,142) | — | |||
Amortization of premium and accretion of discount, net | (299,811) | (221,155) | |||
Deferred tax benefit | (3,799) | — | |||
Amortization of loan structure fees | 188,217 | 298,970 | |||
Amortization of deferred offering costs | 95,382 | 98,729 | |||
Changes in other assets and liabilities | |||||
Increase in interest receivable | (422,888) | (279,075) | |||
Increase in other receivable | (123,392) | — | |||
Decrease (increase) in related party receivable | 48,789 | (94,964) | |||
Decrease in expense reimbursements receivable from the Advisor | 49,497 | 26,409 | |||
Decrease in prepaid expenses | 42,526 | 70,588 | |||
Increase in administrative services payable | 6,585 | 26,149 | |||
Decrease in interest payable | (32,557) | (389,912) | |||
Increase in income incentive fees payable | 6,057 | 30,837 | |||
Increase in capital gains incentive fees payable | 30,074 | 124,892 | |||
(Decrease) increase in unearned revenue | (96,169) | 68,341 | |||
(Decrease) increase in income tax payable | (130,720) | 8,390 | |||
Increase in other accrued expenses and liabilities | 12,958 | 7,771 | |||
Net Cash Used in Operating Activities | $ | (38,623,040) | $ | (23,729,674) | |
Cash Flows from Financing Activities | |||||
Proceeds from issuance of common shares of beneficial interest | $ | 34,960,177 | $ | 10,275,069 | |
Offering costs paid for common shares of beneficial interest issued | (128,350) | (131,095) | |||
Stockholder distributions paid | (11,237,366) | (4,115,942) | |||
Borrowings under Credit Facilities | 67,100,000 | 72,000,000 | |||
Repayments of Credit Facilities | (52,100,000) | (57,415,000) | |||
Financing costs paid on Credit Facilities | — | (352,744) | |||
Short-term loan repayments | — | (11,250,000) | |||
Net Cash Provided by Financing Activities | $ | 38,594,461 | $ | 9,010,288 | |
Net Decrease in Cash and Cash Equivalents | $ | (28,579) | $ | (14,719,386) | |
Cash and Cash Equivalents Balance at Beginning of Period | 593,685 | 15,469,823 | |||
Cash and Cash Equivalents Balance at End of Period | $ | 565,106 | $ | 750,437 | |
Supplemental and Non-Cash Activities | |||||
Cash paid for interest expense | $ | 4,232,791 | $ | 3,616,852 | |
Income and excise tax paid | 159,994 | 8,300 | |||
Increase in deferred offering costs | 32,968 | 32,366 | |||
Value of common shares of beneficial interest issued pursuant to Dividend Reinvestment Plan | 780,177 | 155,615 | |||
(Decrease) increase in dividends payable | (3,551,068) | 910,953 | |||
SOURCE Stellus Private Credit BDC
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