Stellus Investment Capital Corporation provided first and second lien loans to seven different companies in the third quarter, while increasing its net asset value per share.
According to its latest earnings report, the Houston-based business development company made a total of $19.9 million in new investments last quarter, slightly down from $25.5 million over Q3 2015.
Robert T. Ladd, CEO of Stellus, said in the announcement that the company’s NAV increased from $13.12 per share at the end of June to $13.57 at the end of September. That’s compared with $13.19 per share at the end of last December. The company paid a dividend of 34 cents a share, the same amount it paid for the third quarter in 2015. Net investment income totaled $10.2 million and 37 cents a share.
The portfolio also showed an average yield of 11.1 percent, exactly in line with its yield in Q4 2015.
The new investments from last quarter include a $2.6 million first lien loan to Good Source Solutions; a $600,000 first lien loan to Momentum Telecom; a sale of a $3.6 million first lien loan in BlackHawk Mining; a $5.3 million first lien loan to Energy Labs; a $9.2 million second lien loan to KidKraft; $900,000 first lien loan to Vision Media Management & Fulfillment; and a $400,000 drawdown on a first lien loan to Huf Worldwide.
Of the company’s total portfolio, 32 percent are first lien loans, 43 percent second lien debt, 20 percent mezzanine debt and 5 percent equity. Of the debt in the portfolio, 76 percent are floating-rate loans.
Stellus Capital Investment Corporation’s investment advisor is Stellus Capital Management, planning a first close for its second private debt fund with commitments from existing investors by the end of next March, as Private Debt Investor exclusively reported. The firm expects to hold a $300 million to $400 million close for that credit fund, which has a target of $750 million, while the firm has in mind a hard-cap between $1 billion and $1.25 billion