Horizon Technology Finance Reports Mixed Q2 Results

Horizon Technology Finance Corporation recently announced its financial results for the second quarter of 2024, reporting a portfolio size of $647 million. This decrease was attributed to prepayments and fair value adjustments. Despite facing challenges in the venture lending market, Horizon expressed optimism about future opportunities, citing favorable economic indicators and a robust pipeline for new venture loans.

During the quarter, Horizon funded four new debt investments totaling $11 million and recorded an investment income of $26 million. The company’s net asset value (NAV) per share was reported at $9.12 as of June 30. With the addition of a new $100 million credit facility and amendments to existing credit facilities, Horizon concluded the quarter with $150 million in available liquidity and a debt-to-equity ratio of 1.36:1.

Key Highlights:

• Portfolio size decreased to $647 million due to prepayments and fair value adjustments.
• Four new debt investments totaling $11 million were funded.
• Positive economic signals could enhance the venture lending landscape in the latter half of the year.
• Horizon’s liquidity position was strengthened, ending the quarter with $150 million available.
• Q2 investment income stood at $26 million, with a NAV per share of $9.12 as of June 30.

Company Outlook:
Horizon anticipates growth in its portfolio driven by increased market activity in the coming quarters. The company has strengthened its capital resources through new credit facilities and has expressed confidence for improved venture lending conditions as the year progresses.

Challenging Market Conditions:
The venture lending market continues to struggle, with limited exit opportunities for venture capital-backed companies. Early-stage companies without proven business models are encountering heightened difficulties.

Positive Trends:
Despite these challenges, there were indications of increased investor confidence as VC fundraising in the second quarter rose to $28 billion, with ongoing investments in emerging technologies, particularly in AI and healthcare.

Nexii Investment Update:
Horizon also provided updates on its investment in Nexii, which was acquired by an investor group. The company holds both preferred and common equity positions following this acquisition.

Overall, Horizon Technology Finance remains focused on navigating the complexities of the venture lending market while leveraging its experience and strong capital foundation to capitalize on emerging opportunities and drive long-term shareholder value.