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Mar 31
Gladstone Capital Q2 2025 Earnings Report
Gladstone Capital Corporation reported a decrease in total investment income and net assets from operations, but an increase in net investment income for the three months ended March 31, 2025.
Key Takeaways
Gladstone Capital Corporation experienced a decrease in total investment income and net assets from operations for the three months ended March 31, 2025, compared to the same period last year. However, net investment income saw an increase. The company's investment portfolio decreased in fair value, and expenses, net of credits, also decreased.
Total investment income decreased by 10.1% to $21.569 million for the three months ended March 31, 2025, compared to $23.997 million in the prior year period.
Net investment income increased by 4.3% to $11.245 million for the three months ended March 31, 2025, up from $10.777 million in the prior year period.
Net increase in net assets resulting from operations decreased by 62.8% to $8.797 million for the three months ended March 31, 2025, down from $23.632 million in the prior year period.
Total expenses, net of credits, decreased by 21.9% to $10.324 million for the three months ended March 31, 2025, compared to $13.220 million in the prior year period.
Gladstone Capital
Gladstone Capital
Gladstone Capital Revenue by Segment
Gladstone Capital Revenue by Geographic Location
Revenue by Segment
Healthcare, Education, and Childcare Revenue
CapyFin.comDiversified/Conglomerate Manufacturing Revenue
CapyFin.comDiversified/Conglomerate Service Revenue
CapyFin.comBeverage, Food, and Tobacco Revenue
CapyFin.comAerospace and Defense Revenue
CapyFin.comAutomobile Revenue
CapyFin.comMachinery Revenue
CapyFin.comCargo Transportation Revenue
CapyFin.comOil and Gas Revenue
CapyFin.comPersonal and Non-Durable Consumer Products Revenue
CapyFin.comPrinting and Publishing Revenue
CapyFin.comOther Revenue
CapyFin.comRevenue by Geographic Location
South Revenue
CapyFin.comWest Revenue
CapyFin.comMidwest Revenue
CapyFin.comNortheast Revenue
CapyFin.com Forward Guidance
The company anticipates continued investment activity and expects to maintain its qualification as a RIC. Future equity issuances will depend on market conditions and NAV per share. The Credit Facility remains a key financing source, and the company expects to continue making monthly distributions to common and preferred stockholders.
Positive Outlook
- Ability to issue up to an additional $684.4 million in securities under the 2024 Registration Statement.
- Maintained compliance with all Credit Facility covenants as of March 31, 2025.
- Continued monthly distributions to common stockholders of $0.165 per share declared for April, May, and June 2025.
- Continued monthly dividends to preferred stockholders of $0.130208 per share declared for April, May, and June 2025.
- The Credit Facility has an accordion feature permitting an increase in size to $350.0 million.
Challenges Ahead
- Market conditions may affect the trading price of capital stock and inhibit future equity financing.
- Ability to issue equity is constrained if common stock trades below net asset value per common share without stockholder and independent director approval or a rights offering.
- The actual collection of PIK income may be deferred until debt principal repayment, potentially impacting cash flow.
- The company's ability to seek external debt financing is subject to asset coverage limitations of the 1940 Act.
- The fair value measurements of investments involve subjective judgments and estimates, which may fluctuate and differ materially from realized values upon disposal.