Prospect Capital(PSEC) - 2025 Q2 - Quarterly Results

Financial Performance - Net Investment Income (NII) for the quarter ended December 31, 2024, was $86,431,000, a decrease from$ 89,877,000 in the previous quarter and $96,927,000 in the same quarter last year[2]. - Net Income (Loss) applicable to common shareholders was$ (30,993,000), compared to $(165,069,000) in the previous quarter and$ (51,436,000) in the same quarter last year[2]. - Total investment income for the three months ended December 31, 2024, was $185.466 million, a decrease from$ 210.942 million in the same period of 2023, representing a decline of approximately 12%[27]. - Net investment income for the three months ended December 31, 2024, was $86.431 million, compared to$ 96.927 million in the same period of 2023, reflecting a decrease of about 11%[27]. - The company reported net realized losses of $46.653 million for the three months ended December 31, 2024, compared to net realized gains of$ 123 thousand in the same period of 2023[27]. - The company’s net increase (decrease) in net assets resulting from operations applicable to common stockholders was a loss of $30.993 million for the three months ended December 31, 2024, compared to a loss of$ 51.436 million in the same period of 2023[27]. Asset and Liability Management - Total assets decreased to $7,234,855,000 from$ 7,592,705,000 in the previous quarter and $7,781,214,000 in the same quarter last year[2]. - Total assets as of December 31, 2024, were$ 7,234,855,000, a decrease from $7,857,092,000 as of June 30, 2024, representing a decline of approximately 7.9%[25]. - Total investments at fair value decreased to$ 7,132,928,000 from $7,718,243,000, reflecting a reduction of about 7.6%[25]. - Net assets applicable to common shares were$ 3,440,036,000 as of December 31, 2024, down from $3,711,733,000, indicating a decrease of approximately 7.3%[25]. - Total liabilities decreased to$ 2,164,305,000 from $2,559,171,000, showing a reduction of approximately 15.4%[25]. Shareholder Returns - Cumulative paid and declared distributions to common shareholders reached$ 4,445,060,000, representing $21.39 per share, which is 2.7 times the December 2024 common NAV per share[4]. - The company reported a dividend payable of$ 20,076,000 as of December 31, 2024, down from $25,804,000, a decrease of about 22.4%[25]. - The company has adopted a dividend reinvestment plan (DRIP) that offers a 5% discount on shares purchased through the plan[20]. - Shareholders must proactively opt into the DRIP to receive the 5% discount, as many brokers may have automatically opted them out[21]. Investment Strategy - The company invested over$ 21 billion across more than 400 investments since its IPO in July 2004, exiting over 300 of these investments[5]. - Prospect Capital Corporation focuses on directly-originated, agented loans to companies, including those controlled by private equity sponsors and management teams, with various loan structures such as first lien and unsecured loans[37]. - The company invests in senior and secured yield-producing debt and controlling equity positions across various industries, enhancing certainty of closing for sellers[38]. - Prospect Capital Corporation invests in structured credit, diversifying across approximately 100 to 200 broadly syndicated loans, managed by experienced collateral management teams[40]. - The company aims to generate both current income and long-term capital appreciation through its debt and equity investments[41]. - Prospect Capital Corporation has elected to be treated as a business development company under the Investment Company Act of 1940, and as a regulated investment company under the Internal Revenue Code of 1986[41]. Market Conditions and Outlook - The portfolio's annualized current yield for all investments was 9.1%, down from 9.7% in the previous quarter and 10.1% in the same quarter last year[12]. - The weighted average cost of unsecured debt financing was 4.49%, an increase of 0.34% from December 31, 2023[19]. - The company cautions that forward-looking statements may be affected by unknowable future events and conditions, and actual results may vary materially[42]. Earnings Call - The company will host an earnings call on February 11, 2025, at 9:00 a.m. Eastern Time[23].