Stellus Capital Investment Corporation Reports Results for its First Fiscal Quarter Ended March 31, 2026
PR Newswire
HOUSTON, May 11, 2026
HOUSTON, May 11, 2026 /PRNewswire/ -- Stellus Capital Investment Corporation (NYSE:SCM) ("Stellus", "we", or the "Company") today announced financial results for its fiscal quarter ended March 31, 2026.
Robert T. Ladd, Chief Executive Officer of Stellus, stated, "I am pleased to report solid operating results for the quarter ended March 31, 2026, in which we earned U.S. GAAP net investment income of $0.26 per share, core net investment income of $0.27 per share and net realized income of $0.29 per share. During the quarter, we funded $28 million of investments and received $42 million of repayments, resulting in a total portfolio of $990 million at fair value. I'm also pleased to report that our investors have received a total of $339 million in distributions, equivalent to $18.49 per share, since we began operations."
FINANCIAL HIGHLIGHTS
($ in millions, except data relating to per share amounts and shares outstanding)
Three Months Ended | |||||
March 31, 2026 | March 31, 2025 | ||||
Amount | Per Share | Amount | Per Share | ||
Net investment income | $7.50 | $0.26 | $9.79 | $0.35 | |
Core net investment income(1) | 7.86 | 0.27 | 10.29 | 0.37 | |
Net realized gain (loss) on investments | 0.75 | 0.03 | (5.97) | (0.21) | |
Net realized gain (loss) on foreign currency translation | — | — | (0.03) | — | |
Total realized income(2) | $8.25 | $0.29 | $3.79 | $0.14 | |
Distributions | (9.84) | (0.34) | (11.09) | (0.40) | |
Net unrealized change in (depreciation) appreciation on investments | (6.54) | (0.23) | 1.20 | 0.04 | |
Net unrealized change in depreciation on foreign currency translation | (0.05) | — | — | — | |
Net increase in net assets resulting from operations | $1.66 | $0.06 | $4.99 | $0.18 | |
Weighted average shares outstanding | 28,947,254 | 27,602,612 | |||
(1) | Core net investment income, as presented, excludes the impact of capital gains incentive fees (reversal) and income taxes, the majority of which are excise taxes. The Company believes presenting core net investment income and the related per share amount is a useful supplemental disclosure for analyzing its financial performance. However, core net investment income is a non-U.S. GAAP measure and should not be considered as a replacement for net investment income and other earnings measures presented in accordance with U.S. GAAP. A reconciliation of net investment income in accordance with U.S. GAAP to core net investment income is presented in the table below the financial statements. |
(2) | Total realized income is the sum of net investment income, net realized gains (losses) on investments, net realized gains (losses) on foreign currency, and losses on debt extinguishment, all U.S. GAAP measures. |
PORTFOLIO ACTIVITY
($ in millions, except data relating to per share amounts, shares outstanding, and number of portfolio companies)
As of | As of | |||
March 31, 2026 | December 31, 2025 | |||
Investments at fair value | $990.0 | $1,007.6 | ||
Total assets | $1,001.3 | $1,041.3 | ||
Net assets | $363.0 | $371.2 | ||
Shares outstanding | 28,947,254 | 28,947,254 | ||
Net asset value per share | $12.54 | $12.82 | ||
Three Months Ended | ||||
March 31, 2026 | March 31, 2025 | |||
New investments | $27.7 | $55.4 | ||
Repayments of investments | (41.7) | (15.0) | ||
Net activity | ($14.0) | $40.4 | ||
As of | As of | |||
March 31, 2026 | December 31, 2025 | |||
Number of portfolio company investments | 116 | 115 | ||
Number of debt investments | 100 | 100 | ||
Weighted average yield of debt and other income producing | ||||
Cash | 8.1 % | 8.5 % | ||
Payment-in-kind ("PIK") | 0.6 % | 0.5 % | ||
Fee amortization | 0.3 % | 0.3 % | ||
Total | 9.0 % | 9.3 % | ||
Weighted average yield of total investments(4) | ||||
Cash | 7.6 % | 7.9 % | ||
PIK | 0.6 % | 0.5 % | ||
Fee amortization | 0.3 % | 0.3 % | ||
Total | 8.5 % | 8.7 % | ||
(3) | The dollar-weighted average annualized effective yield is computed using the effective interest rate for our debt investments and other income producing investments, including cash and PIK interest, as well as the accretion of deferred fees. The individual investment yields are then weighted by the respective cost of the investments (as of the date presented) in calculating the weighted average effective yield of the portfolio. The dollar-weighted average annualized yield on the Company's investments for a given period will generally be higher than what investors in the Company's common stock would realize in a return over the same period because the dollar-weighted average annualized yield does not reflect the Company's expenses or any sales load that may be paid by investors. |
(4) | The dollar-weighted average yield on total investments takes the same yields as calculated in the footnote above but weights them to determine the weighted average effective yield as a percentage of the Company's total investments, including non-income producing equity positions and debt investments on non-accrual status. |
Results of Operations
Investment income for the three months ended March 31, 2026 and 2025 totaled $23.3 million and $25.0 million, respectively, most of which was interest income from portfolio investments.
Gross operating expenses for the three months ended March 31, 2026 and 2025 totaled $15.8 million and $16.4 million, respectively. For the same respective periods, base management fees totaled $4.4 million and $4.1 million, income incentive fees totaled $0.1 million and $2.1 million, fees and expenses related to our borrowings totaled $8.9 million and $8.3 million (including interest and amortization of deferred financing costs), administrative expenses totaled $0.6 million and $0.4 million, income tax totaled $0.4 million and $0.5 million and other expenses totaled $1.4 million and $1.0 million. The Company waived $0.0 million and $1.2 million of income incentive fees due to the total return limitation pursuant to the provisions of the Investment Advisory Agreement between the Company and the Advisor (as defined below) for the three months ended March 31, 2026 and 2025, respectively, for net operating expenses of $15.8 million and $15.2 million, respectively.
Net investment income was $7.5 million and $9.8 million, or $0.26 and $0.35 per common share based on 28,947,254 and 27,602,612 weighted average common shares outstanding for the three months ended March 31, 2026 and 2025, respectively. Core net investment income, which is a non-U.S. GAAP measure that excludes capital gains incentive fees (reversals) and income tax expense accruals, for the three months ended March 31, 2026 and 2025 was $7.9 million and $10.3 million, or $0.27 and $0.37 per share, respectively.
For the three months ended March 31, 2026 and 2025, the Company's investment portfolio had a net change in unrealized (depreciation) appreciation of ($6.5) million and $1.2 million, respectively, and the Company had net realized gains (losses) of $0.8 million and ($6.0) million, respectively.
Net increase in net assets resulting from operations totaled $1.7 million and $5.0 million, or $0.06 and $0.18 per common share, based on 28,947,254 and 27,602,612 weighted average common shares outstanding for the three months ended March 31, 2026 and 2025, respectively.
Liquidity and Capital Resources
As of March 31, 2026, the Company's amended senior secured revolving credit agreement with certain bank lenders and Zions Bancorporation, N.A. dba Amegy Bank, as administrative agent (as amended from time to time, the "Credit Facility") provided for borrowings in an aggregate amount of up to $335.0 million on a committed basis. As of both March 31, 2026 and December 31, 2025, the Credit Facility had an accordion feature which allowed for potential future expansion of the facility size up to $365.0 million.
As of March 31, 2026 and December 31, 2025, the Company had $241.5 million and $236.6 million in outstanding borrowings under the Credit Facility, respectively.
Distributions
For the three months ended March 31, 2026 and 2025, the Company declared aggregate distributions of $0.34 per share and $0.40 per share, respectively ($9.8 million and $11.1 million in the aggregate, respectively). Tax characteristics of all distributions will be reported to stockholders on Form 1099-DIV after the end of the calendar year. None of these dividends are expected to include a return of capital.
Recent Portfolio Activity
The Company invested in the following portfolio companies during the three months ended March 31, 2026:
Activity Type | Date | Company Name | Company Description | Investment Amount | Instrument Type | ||||||
Add-On Investment | January 2, 2026 | Bart & Associates, LLC* | Provider of content, information, tech-enabled services, and hosts | $ | 2,000,000 | Senior Secured – First Lien | |||||
$ | 43,413 | Equity | |||||||||
New Investment | January 9, 2026 | Silver Corporate Holdings LLC | Senior-care focused placement platform | $ | 7,130,301 | Senior Secured – First Lien | |||||
$ | 100,000 | Revolver Commitment | |||||||||
$ | 498,641 | Equity | |||||||||
Add-On Investment | January 15, 2026 | GRC Java Holdings, LLC* | Specialty coffee platform | $ | 42,783 | Equity | |||||
Add-On Investment | January 20, 2026 | EH Real Estate Services, LLC* | Offers residential property brokerage, title & settlement, and | $ | 380,186 | Senior Secured – First Lien | |||||
Add-On Investment | January 21, 2026 | evolv Holdco, LLC* | Digital transformation consulting firm | $ | 8,036 | Equity | |||||
Add-On Investment | February 2, 2026 | BI Investors, LLC* | Provider of center-based applied behavioral analysis therapy | $ | 5,743 | Equity | |||||
Add-On Investment | February 3, 2026 | Green Topco Holdings, LLC* | Cyber-security focused value-added reseller and associated service provider | $ | 16,598 | Equity | |||||
Add-On Investment | February 3, 2026 | Venbrook Buyer, LLC* | An independent insurance services broker | $ | 628,201 | Senior Secured – First Lien | |||||
Add-On Investment | February 6, 2026 | SP MWM Holdco LLC* | Provider of test and measurement services and equipment | $ | 194,667 | Equity | |||||
Add-On Investment | February 18, 2026 | EH Real Estate Services, LLC* | Offers residential property brokerage, title & settlement, and | $ | 190,093 | Senior Secured – First Lien | |||||
Add-On Investment | February 25, 2026 | Venbrook Buyer, LLC* | An independent insurance services broker | $ | 1,256,415 | Senior Secured – First Lien | |||||
Add-On Investment | March 3, 2026 | EH Real Estate Services, LLC* | Offers residential property brokerage, title & settlement, and | $ | 190,093 | Senior Secured – First Lien | |||||
New Investment | March 3, 2026 | Precision Strategies, LLC | Strategic communications and marketing agency | $ | 6,176,011 | Senior Secured – First Lien | |||||
$ | 100,000 | Revolver Commitment | |||||||||
New Investment | March 6, 2026 | Synergy Health Partners MSO, LLC | Provider of orthopedic and musculoskeletal care | $ | 4,000,000 | Senior Secured – First Lien | |||||
$ | 500,000 | Delayed Draw Term Loan Commitment | |||||||||
$ | 100,000 | Revolver Commitment | |||||||||
$ | 136,634 | Equity | |||||||||
Add-On Investment | March 24, 2026 | Eskola LLC* | Provider of commercial re-roofing services | $ | 101,429 | Equity | |||||
_________________________ *Existing portfolio company |
The Company realized investments in the following portfolio companies during the three months ended March 31, 2026:
Activity Type | Date | Company Name | Company Description | Proceeds Received | Realized Gain | Instrument Type | ||||||||
Full Repayment | January 23, 2026 | Camp Profiles LLC | Provider of digital marketing | $ | 12,041,875 | $ | — | Senior Secured – First Lien | ||||||
Full Realization | $ | 969,138 | $ | 719,138 | Equity | |||||||||
Full Repayment | January 30, 2026 | Luxium Solutions, LLC | Manufacturer and distributor of | $ | 8,169,324 | $ | — | Senior Secured – First Lien | ||||||
$ | 1,182,247 | $ | — | Delayed Draw Term Loan | ||||||||||
Full Repayment | February 3, 2026 | Arctiq, Inc. | Cyber-security focused value-added | $ | 12,202,671 | $ | — | Senior Secured – First Lien | ||||||
$ | 399,965 | $ | — | Delayed Draw Term Loan | ||||||||||
Events Subsequent to March 31, 2026
The Company's management has evaluated subsequent events through May 11, 2026. There have been no subsequent events that require recognition or disclosure except for the following described below.
Investment Portfolio
The Company invested in the following portfolio companies subsequent to March 31, 2026:
Activity Type | Date | Company Name | Company Description | Investment Amount | Instrument Type | ||||||
Add-On Investment | April 1, 2026 | EH Real Estate Services, LLC* | Offers residential property brokerage, title & | $ | 190,093 | Senior Secured – First Lien | |||||
New Investment | April 3, 2026 | VeloSource Purchaser, LLC | Locum tenens staffing agency | $ | 200,000 | Senior Secured – First Lien | |||||
$ | 100,000 | Delayed Draw Term Loan Commitment | |||||||||
$ | 100,000 | Revolver Commitment | |||||||||
$ | 18,605 | Equity | |||||||||
Add-On Investment | April 13, 2026 | Venbrook Buyer, LLC* | An independent insurance services broker | $ | 1,256,415 | Senior Secured – First Lien | |||||
New Investment | April 13, 2026 | Solomon AcquisitionCo, LLC | An innovative process automation and digital systems | $ | 4,196,557 | Senior Secured – First Lien | |||||
$ | 100,000 | Revolver Commitment | |||||||||
$ | 186,807 | Equity | |||||||||
New Investment | April 27, 2026 | Project Freeze** | Manufacturer of walk-in coolers, freezers, and | $ | 4,000,000 | Senior Secured – First Lien | |||||
$ | 100,000 | Delayed Draw Term Loan Commitment | |||||||||
$ | 100,000 | Revolver Commitment | |||||||||
$ | 324,074 | Equity | |||||||||
Add-On Investment | April 28, 2026 | Venbrook Buyer, LLC* | An independent insurance services broker | $ | 502,566 | Senior Secured – First Lien | |||||
Add-On Investment | April 28, 2026 | Advanced Barrier Extrusions, LLC* | Manufacturer of flexible packaging | $ | 330,250 | Senior Secured – First Lien | |||||
_________________________ *Existing portfolio company |
The Company realized investments in the following portfolio companies subsequent to March 31, 2026:
Activity Type | Date | Company Name | Company Description | Proceeds Received | Realized Loss | Instrument Type | ||||||||
Full Repayment | April 17, 2026 | Sales Benchmark Index, LLC | Provider of revenue growth | $ | 11,968,656 | $ | — | Senior Secured – First Lien | ||||||
$ | 443,820 | $ | — | Revolver Commitment | ||||||||||
Full Realization | $ | 486,925 | (178,805) | Equity | ||||||||||
Full Repayment | April 24, 2026 | Equine Network, LLC | Provider of equine competitions, | $ | 9,043,164 | $ | — | Senior Secured – First Lien | ||||||
$ | 97,900 | $ | — | Delayed Draw Term Loan Commitment | ||||||||||
$ | 166,667 | $ | — | Revolver Commitment | ||||||||||
Full Repayment | April 30, 2026 | Cerebro Buyer, LLC | Manufacturer of single-use | $ | 4,526,683 | $ | — | Senior Secured – First Lien | ||||||
$ | 376,902 | $ | — | Delayed Draw Term Loan Commitment | ||||||||||
Credit Facility
The outstanding balance under the Credit Facility as of May 11, 2026 was $238.4 million.
Distributions Declared
On April 14, 2026, the Board of Directors of the Company declared a regular monthly dividend for each of April 2026, May 2026, and June 2026 as follows:
Ex-Dividend | Record | Payment | Amount per | ||||||
Declared | Date | Date | Date | Share | |||||
4/14/2026 | 4/30/2026 | 4/30/2026 | 5/15/2026 | $ | 0.1133 | ||||
4/14/2026 | 5/29/2026 | 5/29/2026 | 6/15/2026 | $ | 0.1133 | ||||
4/14/2026 | 6/30/2026 | 6/30/2026 | 7/15/2026 | $ | 0.1133 | ||||
Conference Call Information
Stellus Capital Investment Corporation will host a conference call to discuss these results on Tuesday, May 12, 2026 at 10:00 AM, Central Time. The conference call will be led by Robert T. Ladd, Chief Executive Officer, and W. Todd Huskinson, Chief Financial Officer, Chief Compliance Officer, Treasurer, and Secretary.
For those wishing to participate by telephone, please dial (888) 506-0062. Use passcode 108816. Starting approximately two hours after the conclusion of the call, a replay will be available through Wednesday, May 20, 2026 by dialing (877) 481-4010 and entering passcode 54017. The replay will also be available on the Company's website.
For those wishing to participate via Live Webcast, connect via the Public (SCIC) section of our website at www.stelluscapital.com, under the Events tab. A replay of the conference will be available on our website for approximately 90 days.
About Stellus Capital Investment Corporation
The Company is an externally managed, closed-end, non-diversified investment management company that has elected to be regulated as a business development company under the Investment Company Act of 1940. The Company's investment objective is to maximize the total return to its stockholders in the form of current income and capital appreciation by investing primarily in private lower middle-market companies (typically those with $5.0 million to $50.0 million of EBITDA (earnings before interest, taxes, depreciation and amortization)) with a focus on investing through first lien (including unitranche) loans, often with a corresponding equity investment. The Company's investment activities are managed by its investment adviser, Stellus Capital Management. To learn more about Stellus Capital Investment Corporation, visit www.stelluscapital.com under the "Public (SCIC)" tab.
Forward-Looking Statements
Statements included herein may contain "forward-looking statements" which relate to future performance or financial condition. Statements other than statements of historical facts included in this press release may constitute forward-looking statements and are not guarantees of future performance or results and involve a number of assumptions, risks and uncertainties, which change over time. Actual results may differ materially from those anticipated in any forward-looking statements as a result of a number of factors, including those described from time to time in filings by the Company with the Securities and Exchange Commission including the final prospectus that will be filed with the Securities and Exchange Commission. The Company undertakes no duty to update any forward-looking statement made herein. All forward-looking statements speak only as of the date of this press release.
Contacts
Stellus Capital Investment Corporation
W. Todd Huskinson, Chief Financial Officer
(713) 292-5414
thuskinson@stelluscapital.com
STELLUS CAPITAL INVESTMENT CORPORATION CONSOLIDATED STATEMENTS OF ASSETS AND LIABILITIES | |||||||
(unaudited) | |||||||
March 31, 2026 | December 31, 2025 | ||||||
ASSETS | |||||||
Controlled investments, at fair value (amortized cost of $34,432,893 and $33,603,521, | $ | 12,237,127 | $ | 14,953,132 | |||
Non-controlled, affiliated investments, at fair value (amortized cost of $4,878,960 and | 3,378,350 | 3,750,674 | |||||
Non-controlled, non-affiliated investments, at fair value (amortized cost of | 974,379,087 | 988,919,589 | |||||
Cash and cash equivalents | 3,376,525 | 25,050,156 | |||||
Receivable for sales and repayments of investments | 492,000 | 581,509 | |||||
Interest receivable | 6,611,848 | 6,375,996 | |||||
Income tax receivable | — | 1,385,387 | |||||
Other receivables | 149,189 | 85,000 | |||||
Related party receivable | — | 20 | |||||
Deferred offering costs | 75,000 | — | |||||
Prepaid expenses | 574,127 | 150,843 | |||||
Total Assets | $ | 1,001,273,253 | $ | 1,041,252,306 | |||
LIABILITIES | |||||||
Notes Payable | $ | 122,758,915 | $ | 122,671,409 | |||
Credit Facility payable | 238,276,659 | 233,167,360 | |||||
SBA-guaranteed debentures | 257,151,049 | 295,984,063 | |||||
Dividends payable | 3,279,724 | 3,858,669 | |||||
Management fees payable | 4,392,357 | 4,442,705 | |||||
Income incentive fees payable | 2,413,077 | 2,317,429 | |||||
Interest payable | 5,729,215 | 6,138,076 | |||||
Related party payable | 2,335,513 | — | |||||
Unearned revenue | 539,630 | 582,007 | |||||
Administrative services payable | 579,529 | 539,338 | |||||
Income tax payable | 93,492 | — | |||||
Other accrued expenses and liabilities | 728,572 | 372,294 | |||||
Total Liabilities | $ | 638,277,732 | $ | 670,073,350 | |||
Commitments and contingencies (Note 7) | |||||||
Net Assets | $ | 362,995,521 | $ | 371,178,956 | |||
NET ASSETS | |||||||
Common stock, par value $0.001 per share (100,000,000 shares authorized; 28,947,254 | $ | 28,947 | $ | 28,947 | |||
Paid-in capital | 397,829,793 | 397,829,793 | |||||
Total distributable loss | (34,863,219) | (26,679,784) | |||||
Net Assets | $ | 362,995,521 | $ | 371,178,956 | |||
Total Liabilities and Net Assets | $ | 1,001,273,253 | $ | 1,041,252,306 | |||
Net Asset Value Per Share | $ | 12.54 | $ | 12.82 | |||
STELLUS CAPITAL INVESTMENT CORPORATION CONSOLIDATED STATEMENTS OF OPERATIONS (unaudited) | ||||||
For the three months ended | ||||||
March 31, 2026 | March 31, 2025 | |||||
INVESTMENT INCOME | ||||||
From non-controlled, affiliated investments | ||||||
Interest income | $ | 45 | $ | — | ||
Payment-in-kind interest income | 72,300 | — | ||||
From non-controlled, non-affiliated investments | ||||||
Interest income | 20,578,575 | 20,817,005 | ||||
Payment-in-kind interest income | 1,602,087 | 3,310,111 | ||||
Other income | 1,039,927 | 824,542 | ||||
Total Investment Income | $ | 23,292,934 | $ | 24,951,658 | ||
OPERATING EXPENSES | ||||||
Management fees | $ | 4,392,357 | $ | 4,054,726 | ||
Valuation fees | 166,119 | 157,889 | ||||
Administrative services expenses | 649,120 | 449,298 | ||||
Income incentive fees | 106,709 | 2,136,491 | ||||
Professional fees | 817,727 | 418,031 | ||||
Directors' fees | 129,250 | 111,250 | ||||
Insurance expense | 93,056 | 97,090 | ||||
Interest expense and other fees | 8,851,541 | 8,263,019 | ||||
Income tax expense | 360,471 | 499,547 | ||||
Other general and administrative expenses | 239,617 | 218,351 | ||||
Total Operating Expenses | $ | 15,805,967 | $ | 16,405,692 | ||
Income incentive fee waiver | (11,061) | (1,242,843) | ||||
Total Operating Expenses, net of fee waivers | $ | 15,794,906 | $ | 15,162,849 | ||
Net Investment Income | $ | 7,498,028 | $ | 9,788,809 | ||
Net realized gain (loss) on non-controlled, non-affiliated investments | $ | 750,410 | $ | (5,967,221) | ||
Net realized gain (loss) on foreign currency translations | 3,664 | (29,655) | ||||
Net change in unrealized (depreciation) appreciation on controlled investments | (3,545,377) | 55,276 | ||||
Net change in unrealized depreciation on non-controlled, affiliated investments | (444,624) | — | ||||
Net change in unrealized (depreciation) appreciation on non-controlled, non-affiliated investments | (2,558,345) | 1,138,017 | ||||
Net change in unrealized (depreciation) appreciation on foreign currency translations | (48,020) | 8,319 | ||||
Net Increase in Net Assets Resulting from Operations | $ | 1,655,736 | $ | 4,993,545 | ||
Net Investment Income Per Share—basic and diluted | $ | 0.26 | $ | 0.35 | ||
Net Increase in Net Assets Resulting from Operations Per Share – basic and diluted | $ | 0.06 | $ | 0.18 | ||
Weighted Average Shares of Common Stock Outstanding—basic and diluted | 28,947,254 | 27,602,612 | ||||
Distributions Per Share—basic and diluted | $ | 0.34 | $ | 0.40 | ||
STELLUS CAPITAL INVESTMENT CORPORATION CONSOLIDATED STATEMENTS OF CHANGES IN NET ASSETS (unaudited) | ||||||||||||||
Common Stock | Total | |||||||||||||
Number | Par | Paid-in | distributable | |||||||||||
of shares | value | capital | (loss) | Net Assets | ||||||||||
Balances at December 31, 2024 | 27,481,118 | $ | 27,481 | $ | 379,549,272 | $ | (9,654,813) | $ | 369,921,940 | |||||
Net investment income | — | — | — | 9,788,809 | 9,788,809 | |||||||||
Net realized loss on investments | — | — | — | (5,967,221) | (5,967,221) | |||||||||
Net realized loss on foreign currency translations | — | — | — | (29,655) | (29,655) | |||||||||
Net change in unrealized appreciation on investments | — | — | — | 1,193,293 | 1,193,293 | |||||||||
Net change in unrealized depreciation on foreign currency translations | — | — | — | 8,319 | 8,319 | |||||||||
Distributions from net investment income | — | — | — | (11,087,389) | (11,087,389) | |||||||||
Issuance of common stock, net of offering costs(1) | 656,085 | 656 | 8,937,430 | — | 8,938,086 | |||||||||
Balances at March 31, 2025 | 28,137,203 | $ | 28,137 | $ | 388,486,702 | $ | (15,748,657) | $ | 372,766,182 | |||||
Balances at December 31, 2025 | 28,947,254 | $ | 28,947 | $ | 397,829,793 | $ | (26,679,784) | $ | 371,178,956 | |||||
Net investment income | — | — | — | 7,498,028 | 7,498,028 | |||||||||
Net realized gain on investments | — | — | — | 750,410 | 750,410 | |||||||||
Net realized gain on foreign currency translation | — | — | — | 3,664 | 3,664 | |||||||||
Net change in unrealized depreciation on investments | — | — | — | (6,548,346) | (6,548,346) | |||||||||
Net change in unrealized depreciation on foreign currency translations | — | — | — | (48,020) | (48,020) | |||||||||
Distributions from net investment income | — | — | — | (9,839,171) | (9,839,171) | |||||||||
Balances at March 31, 2026 | 28,947,254 | $ | 28,947 | $ | 397,829,793 | $ | (34,863,219) | $ | 362,995,521 | |||||
STELLUS CAPITAL INVESTMENT CORPORATION CONSOLIDATED STATEMENTS OF CASH FLOWS (unaudited) | ||||||
For the three months ended | ||||||
March 31, 2026 | March 31, 2025 | |||||
Cash Flows from Operating Activities | ||||||
Net increase in net assets resulting from operations | $ | 1,655,736 | $ | 4,993,545 | ||
Adjustments to reconcile net increase in net assets from operations to net cash used in operating activities: | ||||||
Purchases of investments | (27,664,251) | (55,415,263) | ||||
Proceeds from sales and repayments of investments | 41,713,484 | 14,986,423 | ||||
Net change in unrealized depreciation (appreciation) on investments | 6,548,346 | (1,193,293) | ||||
Net change in unrealized depreciation (appreciation) on foreign currency translations | 48,020 | (8,319) | ||||
Increase in investments due to payment-in-kind income | (1,674,387) | (976,479) | ||||
Amortization of premium and accretion of discount, net | (713,561) | (715,755) | ||||
Amortization of loan structure fees | 254,298 | 315,618 | ||||
Amortization of deferred financing costs | 134,684 | 110,150 | ||||
Amortization of discount on Notes Payable | 33,248 | — | ||||
Amortization of premium on Notes Payable | (30,426) | — | ||||
Amortization of loan fees on SBA-guaranteed debentures | 166,986 | 188,984 | ||||
Net realized (gain) loss on investments | (750,410) | 5,967,221 | ||||
Changes in other assets and liabilities | ||||||
Increase in interest receivable | (235,852) | (1,281,507) | ||||
Decrease (increase) in income tax receivable | 1,385,387 | (1,081,760) | ||||
Increase in other receivables | (64,189) | (20,755) | ||||
Decrease in related party receivables | 20 | 3,687 | ||||
(Increase) decrease in prepaid expenses | (423,284) | 90,313 | ||||
(Decrease) increase in management fees payable | (50,348) | 20,617 | ||||
Increase (decrease) in income incentive fees payable | 95,648 | (1,458,054) | ||||
Increase (decrease) in administrative services payable | 40,191 | (12,990) | ||||
Decrease in interest payable | (408,861) | (3,788,915) | ||||
Increase in related party payable | 2,335,513 | 1,290,893 | ||||
(Decrease) increase in unearned revenue | (42,377) | 72,177 | ||||
Increase in income tax payable | 93,492 | — | ||||
Increase in other accrued expenses and liabilities | 356,278 | 989,436 | ||||
Net Cash Provided by (Used in) Operating Activities | $ | 22,803,385 | $ | (36,924,026) | ||
Cash Flows from Financing Activities | ||||||
Proceeds from the issuance of common stock | $ | — | $ | 9,256,982 | ||
Sales load for common stock issued | — | (138,908) | ||||
Offering costs paid for common stock issued | (75,000) | (179,988) | ||||
Stockholder distributions paid | (10,418,116) | (10,999,933) | ||||
Financing costs paid on Notes Payable | (50,000) | — | ||||
Repayments of SBA-guaranteed debentures | (39,000,000) | (16,250,000) | ||||
Borrowings under Credit Facility | 58,100,000 | 67,700,000 | ||||
Repayments of Credit Facility | (53,033,900) | (21,633,900) | ||||
Net Cash (Used in) Provided by Financing Activities | $ | (44,477,016) | $ | 27,754,253 | ||
Net Decrease in Cash and Cash Equivalents | $ | (21,673,631) | $ | (9,169,773) | ||
Cash and Cash Equivalents Balance at Beginning of Period | $ | 25,050,156 | $ | 20,058,594 | ||
Cash and Cash Equivalents Balance at End of Period | $ | 3,376,525 | $ | 10,888,821 | ||
Supplemental and Non-Cash Activities | ||||||
Cash paid for interest expense | $ | 8,701,862 | $ | 11,437,182 | ||
Income and excise tax refund, net | (1,118,408) | 1,581,307 | ||||
Exchange of investments | 1,999,529 | 1,663,301 | ||||
Reconciliation of Core Net Investment Income(1) (Unaudited) | ||||
Three Months Ended | ||||
March 31, 2026 | March 31, 2025 | |||
Net investment income | $7,498,028 | $9,788,809 | ||
Income tax expense | 360,471 | 499,547 | ||
Core net investment income | $7,858,499 | $10,288,356 | ||
Per share amounts: | ||||
Net investment income per share | $0.26 | $0.35 | ||
Core net investment income per share | $0.27 | $0.37 | ||
Reconciliation of Realized Net Investment Income(2) (Unaudited) | ||||
Three Months Ended | ||||
March 31, 2026 | March 31, 2025 | |||
Net investment income | $7,498,028 | $9,788,809 | ||
Net realized gain (loss) on investments | 750,410 | (5,967,221) | ||
Net realized gain on foreign currency translation | 3,664 | (29,655) | ||
Total realized net investment income | $8,252,102 | $3,791,933 | ||
Per share amounts: | ||||
Net investment income per share | $0.26 | $0.35 | ||
Realized net investment income per share | $0.29 | $0.14 | ||
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SOURCE Stellus Capital Investment Corporation
