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Rand Capital(RAND) - 2025 Q1 - Earnings Call Transcript

Financial Data and Key Metrics Changes - Total investment income for Q1 2025 was 2,000,000,aslightdeclineof2,000,000, a slight decline of 59,000 or 3% from the prior year period, primarily due to lower dividend income and an 8% reduction in interest income [18] - Net investment income increased by 45% year over year to 1,200,000or1,200,000 or 0.42 per share, compared to 840,000or840,000 or 0.33 per share in Q1 2024 [21] - Net asset value per share decreased to 21.99from21.99 from 25.31 at year-end 2024, reflecting the dilutive impact from the issuance of additional shares [22] Business Line Data and Key Metrics Changes - The portfolio stood at a fair value of approximately 62,000,000across19businesses,adeclinefromyearend2024,primarilyduetoloanrepaymentsfromthreeportfoliocompanies[10]Debtinvestmentsnowrepresent7262,000,000 across 19 businesses, a decline from year-end 2024, primarily due to loan repayments from three portfolio companies [10] - Debt investments now represent 72% of the portfolio, up from prior years, supporting greater earnings stability [11] - The annualized weighted average yield on debt investments was 12.2%, down from prior quarters due to one debt investment being on nonaccrual status [11] Market Data and Key Metrics Changes - The number of portfolio companies contributing to investment income decreased to 18 from 24 in the same period last year [18] - Exposure to professional services decreased from 48% to 45%, and manufacturing declined from 13% to 8%, while consumer products grew as a share of the portfolio [14] Company Strategy and Development Direction - The company aims to maintain a strong financial position and has repaid 600,000 of its revolver debt, ending the quarter with nearly 5,000,000incashandover5,000,000 in cash and over 22,000,000 in available credit capacity [6] - The focus remains on disciplined execution, proactive portfolio oversight, and building sustainable shareholder value [7] - The investment strategy prioritizes structures where subordinated debt provides a yield-based return while capturing potential upside through equity participation [12] Management's Comments on Operating Environment and Future Outlook - Management acknowledged ongoing macroeconomic and political uncertainty affecting new investment opportunities but remains optimistic about capitalizing on conditions as they improve [6][27] - The company is committed to driving NAV growth and total returns through active portfolio oversight and sound financial management [28] Other Important Information - The company declared a regular quarterly cash dividend of $0.29 per share, payable on or about June 13, 2025 [23] - The Board of Directors renewed the share repurchase program, authorizing the repurchase of up to 1,500,000 shares [24] Q&A Session Summary - No specific questions or answers were documented in the provided content, thus this section is not applicable.