Oxford Lane Capital Corp Reports Net Asset Value Per Share of $4.91

Oxford Lane Capital Corp Reports Q1 2025 Earnings

Oxford Lane Capital Corp has announced its earnings for the first fiscal quarter of 2025, revealing a net asset value per share of $4.91, a modest rise from $4.90 in the previous quarter. The company reported a substantial increase in GAAP total investment income, reaching approximately $89.8 million, which marks an increase of roughly $7.1 million from the last quarter.

GAAP net investment income held steady at around $56 million, equating to $0.22 per share, unchanged from the previous quarter. However, the core net investment income demonstrated a notable increase, totaling approximately $107.2 million, or $0.41 per share. The quarter experienced net unrealized depreciation on investments amounting to nearly $14.4 million, alongside net realized gains of about $6.1 million. The company has declared monthly common stock distributions of $0.09 per share for October, November, and December of 2024.

Key Highlights:

• Net asset value per share increased slightly to $4.91.
• GAAP total investment income rose to approximately $89.8 million.
• GAAP net investment income remained steady at $56 million, or $0.22 per share.
• Core net investment income increased to approximately $107.2 million, or $0.41 per share.
• Monthly stock distributions of $0.09 per share were declared for the last quarter of 2024.
• Approximately 45.9 million shares were issued, yielding net proceeds of about $242.1 million.

Company Outlook:

• The company intends to continue its opportunistic and unconstrained CLO investment strategy.
• Focus remains on maximizing long-term total returns through active management and strategic investments.

Bearish Aspects:

• Net unrealized depreciation on investments was approximately $14.4 million.
• The weighted average effective yield of CLO equity investments saw a slight decrease.
• Distress ratio increased to 4.4% from 3.5% at the end of the previous quarter.

Bullish Aspects:

• The weighted average yield of CLO debt investments rose to 17.4%.
• Cash distribution yield of CLO equity investments climbed to 26.9%.
• Net increase in net assets from operations was approximately $47.7 million.

Additional Insights:

• The median U.S. CLO equity net asset values fell by about 2 points due to declining U.S. loan prices.
• The earnings call emphasized the commitment to shareholder returns, as the company has maintained dividend payments for 14 consecutive years.

Q&A Highlights:

• The increase in CLO cash yields was attributed to a lag in repricing and first-time payments.
• The company’s leverage is primarily driven by pricing considerations, with no specific target leverage shared.
• The growth in expenses is likely linked to the expansion of the fund.
• No significant stress observed in the portfolio beyond general economic concerns.

In summary, Oxford Lane Capital Corp’s earnings report indicates a resilient performance amid changing market conditions, with plans for strategic investment to achieve long-term growth for shareholders. The company continues to uphold a strong dividend track record, providing consistent returns to its investors.