Oxford Square Capital Corp. Announces Net Asset Value and Selected Financial Results for the Quarter Ended June 30, 2024 and Declaration of Distributions on Common Stock for the Months Ending October 31, November 30, and December 31, 2024
GREENWHICH, Conn., Aug. 13, 2024 (GLOBE NEWSWIRE) -- Oxford Square Capital Corp. (NasdaqGS: OXSQ) (NasdaqGS: OXSQZ) (NasdaqGS: OXSQG) (the “Company,” “we,” “us” or “our”) announced today its financial results and related information for the quarter ended June 30, 2024.
On August 8, 2024, our Board of Directors declared the following distributions on our common stock:
Month Ending
Record Date
Payment Date
Amount Per Share
October 31, 2024
October 17, 2024
October 31, 2024
$0.035
November 30, 2024
November 15, 2024
November 29, 2024
$0.035
December 31, 2024
December 17, 2024
December 31, 2024
$0.035
Net asset value (“NAV”) per share as of June 30, 2024 stood at $2.43, compared with a NAV per share on March 31, 2024 of $2.42.
Net investment income (“NII”) was approximately $7.7 million, or $0.13 per share, for the quarter ended June 30, 2024, compared with approximately $6.5 million, or $0.11 per share, for the quarter ended March 31, 2024.
Total investment income for the quarter ended June 30, 2024 amounted to approximately $11.4 million, compared with approximately $10.7 million for the quarter ended March 31, 2024.
For the quarter ended June 30, 2024 we recorded investment income from our portfolio as follows:
$7.0 million from our debt investments;
$3.9 million from our CLO equity investments; and
$0.5 million from other income.
Our total expenses for the quarter ended June 30, 2024 were approximately $3.7 million, compared with total expenses of approximately $4.1 million for the quarter ended March 31, 2024.
As of June 30, 2024, the following metrics applied (note that none of these metrics represented a total return to shareholders):
The weighted average yield of our debt investments was 13.7% at current cost, compared with 13.9% as of March 31, 2024;
The weighted average effective yield of our CLO equity investments at current cost was 9.4%, compared with 9.5% as of March 31, 2024; and
The weighted average cash distribution yield of our cash income producing CLO equity investments at current cost was 16.2%, compared with 13.7% as of March 31, 2024.
For the quarter ended June 30, 2024, we recorded a net increase in net assets resulting from operations of approximately $5.3 million, consisting of:
NII of approximately $7.7 million;
Net realized losses of approximately $30.4 million; and
Net unrealized appreciation of approximately $28.0 million.
During the second quarter of 2024, we made investments of approximately $28.8 million and received approximately $19.2 million from sales and repayments of investments.
Our weighted average credit rating was 2.3 based on total fair value and 2.7 based on total principal amount as of June 30, 2024, compared with a weighted average credit rating of 2.3 based on total fair value and 2.9 based on total principal amount as of March 31, 2024.
As of June 30, 2024, we had three debt investments in one portfolio company on non-accrual status, with a combined fair value of approximately $0.5 million. Also, as of June 30, 2024, our preferred equity investments in one of our portfolio companies were on non-accrual status, which had an aggregate fair value of approximately $2.5 million.
For the quarter ended June 30, 2024, we issued a total of approximately 2.9 million shares of common stock pursuant to an “at-the-market” offering. After deducting the sales agent’s commissions and offering expenses, this resulted in net proceeds of approximately $8.9 million. As of June 30, 2024, we had approximately 62.7 million shares of common stock outstanding.
We will hold a conference call to discuss second quarter results today, Tuesday, August 13th, 2024 at 9:00 AM ET. The toll-free dial-in number is 800-274-8461, verbal access code OXFORD. There will be a recording available for 30 days. If you are interested in hearing the recording, please dial 877-710-5302.
A presentation containing further detail regarding our quarterly results of operations has been posted under the Investor Relations section of our website at www.oxfordsquarecapital.com.
OXFORD SQUARE CAPITAL CORP.
STATEMENTS OF ASSETS AND LIABILITIES
June 30, 2024
December 31, 2023
(Unaudited)
ASSETS
Non-affiliated/non-control investments (cost: $397,523,375 and $440,069,822, respectively)
$
249,566,370
$
261,614,335
Affiliated investments (cost: $16,836,822 and $16,836,822, respectively)
2,543,665
5,276,092
Cash and cash equivalents
30,014,406
5,740,553
Securities sold, not settled
3,402,645
—
Interest and distributions receivable
3,274,499
3,976,408
Other assets
1,383,299
1,060,384
Total assets
$
290,184,884
$
277,667,772
LIABILITIES
Notes payable – 6.25% Unsecured Notes, net of deferred issuance costs of $427,349 and $543,609, respectively
44,363,401
44,247,141
Notes payable – 5.50% Unsecured Notes, net of deferred issuance costs of $1,575,975 and $1,768,219, respectively
78,924,025
78,731,781
Securities purchased, not settled
10,852,405
—
Base Fee and Net Investment Income Incentive Fee payable to affiliate
1,023,352
1,012,389
Accrued interest payable
1,204,487
1,204,487
Accrued expenses
1,405,182
1,163,349
Total liabilities
137,772,852
126,359,147
NET ASSETS
Common stock, $0.01 par value, 100,000,000 shares authorized; 62,705,628 and 59,300,472 shares issued and outstanding, respectively
627,056
593,005
Capital in excess of par value
468,341,856
458,121,381
Total distributable earnings/(accumulated losses)
(316,556,880
)
(307,405,761
)
Total net assets
152,412,032
151,308,625
Total liabilities and net assets
$
290,184,884
$
277,667,772
Net asset value per common share
$
2.43
$
2.55
OXFORD SQUARE CAPITAL CORP.
STATEMENTS OF OPERATIONS
(Unaudited)
Three Months Ended June 30, 2024
Three Months Ended June 30, 2023
Six Months Ended June 30, 2024
Six Months Ended June 30, 2023
INVESTMENT INCOME
From non-affiliated/non-control investments:
Interest income – debt investments
$
7,021,819
$
8,799,180
$
13,442,866
$
17,093,340
Income from securitization vehicles and investments
3,885,916
4,329,300
7,818,290
8,708,795
Other income
537,721
384,500
861,724
652,643
Total investment income from non-affiliated/non-control investments
11,445,456
13,512,980
22,122,880
26,454,778
Total investment income
11,445,456
13,512,980
22,122,880
26,454,778
EXPENSES
Interest expense
1,960,984
3,087,951
3,921,966
6,173,317
Base Fee
1,023,352
1,257,688
2,011,168
2,417,334
Professional fees
491,037
281,928
802,784
617,808
Compensation expense
174,482
190,159
381,380
457,124
General and administrative(1)
447,519
430,149
794,144
803,322
Excise tax(1)
(373,824
)
300,000
(48,024
)
300,000
Total expenses before incentive fees
3,723,550
5,547,875
7,863,418
10,768,905
Net Investment Income Incentive Fees
—
1,299,324
—
2,529,308
Capital gains incentive fees
—
—
—
—
Total incentive fees
—
1,299,324
—
2,529,308
Total expenses(1)
3,723,550
6,847,199
7,863,418
13,298,213
Net investment income
7,721,906
6,665,781
14,259,462
13,156,565
NET CHANGE IN UNREALIZED APPRECIATION/(DEPRECIATION) AND REALIZED GAINS/(LOSSES) ON INVESTMENT TRANSACTIONS
Net change in unrealized appreciation/(depreciation) on investments:
Non-Affiliate/non-control investments
30,353,371
4,900,785
30,498,482
3,957,995
Affiliated investments
(2,376,310
)
3,352,146
(2,732,427
)
4,072,635
Total net change in unrealized appreciation/(depreciation) on investments
27,977,061
8,252,931
27,766,055
8,030,630
Net realized losses:
Non-affiliated/non-control investments
(30,439,962
)
(3,331,308
)
(38,534,902
)
(3,331,308
)
Total net realized losses
(30,439,962
)
(3,331,308
)
(38,534,902
)
(3,331,308
)
Net increase in net assets resulting from operations
$
5,259,005
$
11,587,404
$
3,490,615
$
17,855,887
Net increase in net assets resulting from net investment income per common share (Basic and Diluted):
$
0.13
$
0.13
$
0.24
$
0.26
Net increase in net assets resulting from operations per common share (Basic and Diluted):
$
0.09
$
0.23
$
0.06
$
0.36
Weighted average shares of common stock outstanding (Basic and Diluted):
60,654,421
50,542,374
60,146,853
50,202,259
Distributions per share
$
0.105
$
0.105
$
0.210
$
0.210
____________
(1) Change in prior periods was made to conform to the current period presentation.
FINANCIAL HIGHLIGHTS
Three Months Ended June 30, 2024
Three Months Ended June 30, 2023
Six Months Ended June 30, 2024
Six Months Ended June 30, 2023
Per Share Data
Net asset value at beginning of period
$
2.42
$
2.80
$
2.55
$
2.78
Net investment income(1)
0.13
0.13
0.24
0.26
Net realized and unrealized (losses)/gains(2)
(0.04
)
0.10
(0.18
)
0.09
Net (decrease)/increase in net asset value from operations
0.09
0.23
0.06
0.35
Distributions per share from net investment income
(0.11
)
(0.11
)
(0.21
)
(0.21
)
Tax return of capital distributions(3)
—
—
—
—
Total distributions
(0.11
)
(0.11
)
(0.21
)
(0.21
)
Effect of shares issued
0.03
(0.04
)
0.03
(0.04
)
Net asset value at end of period
$
2.43
$
2.88
$
2.43
$
2.88
Per share market value at beginning of period
$
3.17
$
3.16
$
2.86
$
3.12
Per share market value at end of period
$
2.94
$
2.65
$
2.94
$
2.65
Total return based on Market Value(4)
(4.06
)%
(13.00
)%
9.98
%
(9.15
)%
Total return based on Net Asset Value(5)
4.75
%
6.61
%
3.53
%
11.15
%
Shares outstanding at end of period
62,705,628
56,395,751
62,705,628
56,395,751
Ratios/Supplemental Data(8)
Net assets at end of period (000’s)
$
152,412
$
162,412
$
152,412
$
162,412
Average net assets (000’s)
$
146,781
$
144,439
$
147,520
$
141,852
Ratio of expenses to average net assets(6)
11.15
%
18.96
%
10.99
%
18.75
%
Ratio of net investment income to average net assets(6)
20.04
%
18.46
%
19.00
%
18.55
%
Portfolio turnover rate(7)
5.69
%
1.48
%
11.08
%
2.60
%
___________
(1) Represents per share net investment income for the period, based upon weighted average shares outstanding. (2) Net realized and unrealized gains/(losses) include rounding adjustments to reconcile change in net asset value per share. (3) Management monitors available taxable earnings, including net investment income and realized capital gains, to determine if a tax return of capital may occur for the year. To the extent the Company’s taxable earnings fall below the total amount of the Company’s distributions for that fiscal year, a portion of those distributions may be deemed a tax return of capital to the Company’s stockholders. The ultimate tax character of the Company’s earnings cannot be determined until tax returns are prepared after the end of the fiscal year. The amounts and sources of distributions reported are only estimates (based on an average of the reported tax character historically) and are not being provided for U.S. tax reporting purposes. (4) Total return based on market value equals the increase or decrease of ending market value over beginning market value, plus distributions, divided by the beginning market value, assuming distribution reinvestment prices obtained under the Company’s distribution reinvestment plan, excluding any discounts. Total return is not annualized. (5) Total return based on net asset value equals the increase or decrease of ending net asset value over beginning net asset value, plus distributions, divided by the beginning net asset value. Total return is not annualized. (6) Annualized. (7) Portfolio turnover rate is calculated using the lesser of the year-to-date investment sales and debt repayments or year-to-date investment purchases over the average of the total investments at fair value. (8) The following table provides supplemental performance ratios (annualized) measured for the three and six months ended June 30, 2024 and 2023:
Three Months Ended June 30, 2024
Three Months Ended June 30, 2023
Six Months Ended June 30, 2024
Six Months Ended June 30, 2023
Ratio of expenses to average net assets:
Operating expenses before incentive fees
11.15
%
15.36
%
10.99
%
15.18
%
Net investment income incentive fees
—
%
3.60
%
—
%
3.57
%
Ratio of expenses, excluding interest expense, to average net assets
5.81
%
10.41
%
5.68
%
10.05
%
About Oxford Square Capital Corp.
Oxford Square Capital Corp. is a publicly-traded business development company principally investing in syndicated bank loans and, to a lesser extent, debt and equity tranches of collateralized loan obligation (“CLO”) vehicles. CLO investments may also include warehouse facilities, which are financing structures intended to aggregate loans that may be used to form the basis of a CLO vehicle.
Forward-Looking Statements
This press release contains forward-looking statements subject to the inherent uncertainties in predicting future results and conditions. Any statements that are not statements of historical fact (including statements containing the words “believes,” “plans,” “anticipates,” “expects,” “estimates” and similar expressions) should also be considered to be forward-looking statements. These statements are not guarantees of future performance, conditions or results and involve a number of risks and uncertainties. Certain factors could cause actual results and conditions to differ materially from those projected in these forward-looking statements. These factors are identified from time to time in our filings with the Securities and Exchange Commission. We undertake no obligation to update such statements to reflect subsequent events, except as may be required by law.
