Saratoga Investment Corp. Announces Fiscal First Quarter 2026 Financial Results
Rhea-AI Summary
Saratoga Investment Corp. (NYSE:SAR), a business development company, reported strong fiscal Q1 2026 results with significant improvements in key metrics. The company achieved a 17.9% increase in Adjusted NII per share to $0.66 and a 0.9% increase in NAV to $396.4 million. The quarterly ROE reached 14.1%, generating a last-twelve-months ROE of 9.3%, outperforming the BDC industry average of 7.0%.
The company maintained a robust portfolio of $968.3 million in AUM, with 86.9% in first lien debt. During Q1, SAR originated $50.1 million in new investments and received $64.3 million in repayments. The company declared a quarterly dividend of $0.75 per share, representing an 11.8% yield based on the July 7, 2025 stock price.
SAR's financial position remains strong with $224.3 million in cash available for new investments or debt repayment, while maintaining high portfolio quality with 99.7% of credits rated in their highest category.
Positive
- Quarterly ROE of 14.1% beating BDC industry average of 7.0%
- 17.9% increase in Adjusted NII per share from previous quarter
- Strong cash position of $224.3 million available for deployment
- 99.7% of credits rated in highest category with minimal non-accruals
- Net interest margin expanded from $13.7M to $15.6M quarter-over-quarter
- Portfolio generated $2.9 million in realized gains
Negative
- AUM decreased 11.6% year-over-year to $968.3 million
- Total investment income decreased 16.4% year-over-year to $32.3 million
- NAV per share declined to $25.52 from $26.85 year-over-year
- Portfolio fair value remains 2.1% below cost
News Market Reaction – SAR
In the trading session that priced this news, SAR declined 2.88%, reflecting a moderate negative market reaction.
Data tracked by StockTitan Argus on the day of publication.
AI-generated analysis. How Rhea-AI works. Not financial advice.
Reports
Quarterly ROE of
NEW YORK, July 08, 2025 (GLOBE NEWSWIRE) -- Saratoga Investment Corp. (NYSE: SAR) (“Saratoga Investment” or “the Company”), a business development company (“BDC”), today announced financial results for its fiscal first quarter 2026 ended May 31, 2025.
Summary Financial Information
The Company’s summarized financial information is as follows:
| For the three months ended and as of | ||||||
| ($ in thousands, except per share) | May 31, 2025 | February 28, 2025 | May 31, 2024 | |||
| Assets Under Management (AUM) | 968,318 | 978,078 | 1,095,559 | |||
| Net Asset Value (NAV) | 396,369 | 392,666 | 367,855 | |||
| NAV per share | 25.52 | 25.86 | 26.85 | |||
| Total Investment Income | 32,319 | 31,295 | 38,678 | |||
| Net Investment Income (NII) per share | 0.66 | 0.56 | 1.05 | |||
| Adjusted NII per share | 0.66 | 0.56 | 1.05 | |||
| Earnings per share | 0.91 | (0.05 | ) | 0.48 | ||
| Dividends per share (declared) | 0.75 | 0.74 | 0.74 | |||
| Return on Equity – last twelve months | 9.3 | % | 7.5 | % | 4.4 | % |
| – annualized quarter | 14.1 | % | (0.7 | %) | 7.2 | % |
| Originations | 50,086 | 41,802 | 39,301 | |||
| Repayments | 64,330 | 15,867 | 75,703 | |||
Christian L. Oberbeck, Chairman and Chief Executive Officer of Saratoga Investment, commented, “This quarter’s highlights include a
“Building on our strong dividend distribution history, we announced a base dividend of
“During the quarter, we continued to see a slower level of deal volume and M&A activity in the lower middle market following the recent tariff developments that had a stifling effect on new debt issuances. Despite these macro factors, our portfolio had multiple debt repayments and an equity realization in Q1, in addition to healthy new originations. These realizations generated
“Saratoga’s overall performance is reflected in our key performance indicators this past quarter, including: (i) Q1 ROE of
“At the foundation of our strong operating performance is the high-quality nature, resilience and balance of our
“Additionally, during the quarter our net interest margin expanded meaningfully from
“Our quarter-end cash position increased from
“Our overall credit quality for this quarter remained steady at
Mr. Oberbeck concluded, “As we continue to navigate the challenges posed by the current geopolitical landscape and the volatility seen in the broader macro environment, we remain confident in our experienced management team, robust pipeline, strong leverage structure, and high underwriting standards to continue to steadily increase the size, quality and investment performance of our portfolio over the long-term, and deliver exceptional risk adjusted returns to shareholders.”
Discussion of Financial Results for the Quarter ended May 31, 2025:
- AUM as of May 31, 2025 was
$968.3 million , a decrease of11.6% from$1.095 billion as of May 31, 2024, and a decrease of1.0% from$978.1 million as of last quarter. - Total investment income for the three months ended May 31, 2025 was
$32.3 million , a decrease of$6.4 million , or16.4% , from$38.7 million for the quarter ended May 31, 2024, and an increase of$1.0 million , or3.3% , as compared to$31.3 million for the quarter ended February 28, 2025. This quarter’s investment income decrease as compared to last year was due to both this past year’s interest base rate decreases as well as lower recent AUM levels, reflecting the significant net repayments the last six months. This quarter’s sequential increase is driven by the full period impact of Q4 originations. Investment income reflects a weighted average interest rate on the core BDC portfolio of11.5% , unchanged as compared to11.5% as of February 28, 2025 and down from12.6% as of May 31, 2024, with the yield reduction primarily reflecting SOFR base rate decreases over the past year. - Total expenses for the quarter ended May 31, 2025, excluding interest and debt financing expenses, base management fees and incentive fees, and income and excise taxes, decreased
$0.1 million to$2.8 million as compared to$2.9 million for the quarter ended May 31, 2025, and increased$1.4 million as compared to$1.4 million for the quarter ended February 28, 2025. This represented0.8% of average total assets on an annualized basis, unchanged from last quarter and down from1.0% last year. - Adjusted NII for the quarter ended May 31, 2025, was
$10.1 million , a decrease of$4.2 million , or29.3% , from$14.3 million in the quarter ended May 31, 2024, and an increase of$2.1 million , or26.2% from$8.0 million in the quarter ended February 28, 2025. This quarter’s increase in adjusted NII as compared to the prior quarter was primarily due to the non-recurrence this quarter of the$2.4 million annual excise tax recognized last quarter. The decrease from the previous year was largely due to lower AUM and base interest rates, as previously noted. - NII Yield as a percentage of average net asset value was
10.3% for the quarter ended May 31, 2025. Adjusted for the incentive fee accrual related to net capital gains, the NII Yield was also10.3% . In comparison, adjusted NII Yield was15.5% for the quarter ended May 31, 2024, and8.4% for the quarter ended February 28, 2025. - NAV was
$396.4 million as of May 31, 2025, an increase of$28.5 million from$367.9 million as of May 31, 2024, and an increase of$3.7 million from$392.7 million as of February 28, 2025. - NAV per share was
$25.52 as of May 31, 2025, compared to$26.85 as of May 31, 2024, and$25.86 as of February 28, 2025. - Return on equity (“ROE”) for the last twelve months ended May 31, 2025 was
9.3% , up from4.4% for the comparable period last year, and7.5% for the twelve months ended February 28, 2025. ROE on an annualized basis for the quarter ended May 31, 2025, was14.1% , up from7.2% for the comparable period last year, and (0.7)% for the previous period ended February 28, 2025. - The weighted average common shares outstanding for the quarter ended May 31, 2025 was 15.3 million, increasing from 14.5 million and 13.7 million for the quarters ended February 28, 2025 and May 31, 2024, respectively.
Portfolio and Investment Activity for the Quarter Ended May 31, 2025
- Fair value of Saratoga Investment’s portfolio was
$968.3 million , excluding$224.3 million in cash and cash equivalents, principally invested in 46 portfolio companies, one collateralized loan obligation fund (the “CLO”), one joint venture fund (the “JV”), and nine BB CLO debt investments. - Cost of investments made during the quarter ended May 31, 2025 were
$50.1 million , including two investments in new portfolio companies and six follow-ons. - Principal repayments during the quarter ended May 31, 2025 were
$64.3 million , including one equity realization, four full repayments of existing investments and five partial repayments of existing investments, plus debt amortization.- For the quarter ended May 31, 2025, the fair value of the portfolio increased by
$3.8 million of net realized gains and unrealized appreciation, consisting of (1)$2.6 million net appreciation in our core non-CLO portfolio, including Pepper Palace and Zollege, (ii) net unrealized depreciation in the CLO of$0.3 million , and net unrealized appreciation of$0.1 million in the JV, (iii)$0.2 million of net unrealized appreciation in our new BB CLO debt investments, (iv)$0.6 million net realized appreciation on our Identity investment equity realization and numerous debt repayments that generated$2.2 million of life-to-date realized gains, and (v) further net realized gains of$0.7 million on escrow payments received on our Netreo and Hema Terra investments. - Since taking over management of the BDC in 2010, the Company has generated
$1.26 billion of repayments and sales of investments originated by Saratoga Investment, generating a gross unlevered IRR of15.0% . Total investments originated by Saratoga are$2.36 billion in 122 portfolio companies.
- For the quarter ended May 31, 2025, the fair value of the portfolio increased by
- The overall portfolio composition consisted of
86.9% of first lien term loans,0.7% of second lien term loans,1.7% of unsecured term loans,2.8% of structured finance securities, and7.9% of common equity. - The weighted average current yield on Saratoga Investment’s portfolio based on current fair values was
10.7% , which was comprised of a weighted average current yield of11.3% on first lien term loans,16.8% on second lien term loans,10.6% on unsecured term loans,15.6% on structured finance securities and0.0% on equity interests.
Liquidity and Capital Resources
Outstanding Borrowings:
- As of May 31, 2025, Saratoga Investment had a combined
$70.0 million in outstanding combined borrowings under its$65.0 million senior secured revolving credit facility with Encina and its$75.0 million senior secured revolving credit facility with Live Oak. - At the same time, Saratoga Investment had
$131.0 million of SBA debentures in its SBIC II license outstanding,$39.0 million of SBA debentures in its SBIC III license outstanding,$269.4 million of listed baby bonds issued,$250.0 million of unsecured unlisted institutional bond issuances, four unlisted issuances of$32.0 million in total, and an aggregate of$224.3 million in cash and cash equivalents.
Undrawn Borrowing Capacity:
- With
$70.0 million available under the two credit facilities and$224.3 million of cash and cash equivalents as of May 31, 2025, Saratoga Investment has a total of$294.3 million of undrawn credit facility borrowing capacity and cash and cash equivalents to be used for new investments or to support existing portfolio companies in the BDC and the SBIC. - In addition, Saratoga Investment has
$136.0 million in undrawn SBA debentures available from its existing SBIC III license. - Availability under the Encina and Live Oak credit facilities can change depending on portfolio company performance and valuation. In addition, certain follow-on investments in SBIC II and the BDC will not qualify for SBIC III funding. Overall outstanding SBIC debentures are limited to
$350.0 million across all active SBIC licenses. - Total Saratoga Investment undrawn borrowing capacity is therefore
$430.3 million . - As of May 31, 2025, Saratoga Investment had
$58.6 million of committed undrawn lending commitments and$77.7 million of discretionary funding commitments.
Additionally:
- Saratoga Investment has an active equity distribution agreement with Ladenburg Thalmann & Co. Inc., Raymond James and Associates, Inc, Lucid Capital Markets, LLC and Compass Point Research and Trading, LLC, through which the Company may offer for sale, from time to time, up to
$300.0 million of common stock through an ATM offering.- As of May 31, 2025, Saratoga Investment has sold 8,089,547 shares for gross proceeds of
$214.3 million at an average price of$26.37 for aggregate net proceeds of$212.6 million (net of transaction costs). - During the three months ended May 31, 2025, Saratoga Investment sold a total of 244,831 shares for gross proceeds of
$6.4 million at an average price of$26.31 for aggregate net proceeds of$6.4 million (net of transaction costs).
- As of May 31, 2025, Saratoga Investment has sold 8,089,547 shares for gross proceeds of
Dividend
On June 12, 2025, Saratoga Investment announced that its Board of Directors declared a base quarterly dividend of
| Month | Amount Per Share | Record Date | Payment Date | |||
| June 2025 | July 8, 2025 | July 24, 2025 | ||||
| July 2025 | August 6, 2025 | August 21, 2025 | ||||
| August 2025 | September 5, 2025 | September 24, 2025 | ||||
Shareholders have the option to receive payment of dividends in cash or receive shares of common stock, pursuant to the Company’s DRIP. Shares issued under the Company’s DRIP is issued at a
The following table highlights Saratoga Investment’s dividend history over the past fourteen quarters:
| Period (Fiscal Year ends Feb) | Base Dividend Per Share | Special Dividend Per Share | Total Dividend Per Share | |||
| Fiscal Q2 2026 (August 2025) | - | |||||
| Fiscal Q2 2026 (July 2025) | - | |||||
| Fiscal Q2 2026 (June 2025) | - | |||||
| Fiscal Q1 2026 (May 2025) | - | |||||
| Fiscal Q1 2026 (April 2025) | - | |||||
| Fiscal Q1 2026 (March 2025) | - | |||||
| Full Year Fiscal 2026 | $1.50 | - | $1.50 | |||
| Fiscal Q4 2025 | - | |||||
| Fiscal Q3 2025 | ||||||
| Fiscal Q2 2025 | - | |||||
| Fiscal Q1 2025 | - | |||||
| Full Year Fiscal 2025 | $2.96 | $0.35 | $3.31 | |||
| Fiscal Q4 2024 | - | |||||
| Fiscal Q3 2024 | - | |||||
| Fiscal Q2 2024 | - | |||||
| Fiscal Q1 2024 | - | |||||
| Full Year Fiscal 2024 | $2.86 | - | $2.86 | |||
| Fiscal Q4 2023 | - | |||||
| Fiscal Q3 2023 | - | |||||
| Fiscal Q2 2023 | - | |||||
| Fiscal Q1 2023 | - | |||||
| Full Year Fiscal 2023 | $2.44 | - | $2.44 | |||
Share Repurchase Plan
As of May 31, 2025, the Company purchased 1,035,203 shares of common stock, at the average price of
Previously, in fiscal year 2015, the Company announced the approval of an open market share repurchase plan (the “Share Repurchase Plan”) that allows it to repurchase up to 200,000 shares of its common stock at prices below its NAV as reported in its then most recently published financial statements. Since then, the Share Repurchase Plan has been extended annually, and the Company has periodically increased the amount of shares of common stock that may be purchased under the Share Repurchase Plan, most recently to 1.7 million shares of common stock. On January 7, 2025, its Board of Directors extended the Share Repurchase Plan for another year to January 15, 2026.
Fiscal First Quarter 2026 Conference Call/Webcast Information
| When: | Wednesday, July 9, 2025 10:00 a.m. Eastern Time (ET) | |
| How: | Webcast: Interested parties may access a live webcast of the call and find the Q1 2026 presentation by going to the “Events & Presentations” section of Saratoga Investment Corp.’s investor relations website (Saratoga events and presentations). A replay of the webcast will also be available for a limited time at Saratoga events and presentations. | |
| Call: | To access the call by phone, please go to this link (Registration Link) and you will be provided with dial in details. To avoid delays, we encourage participants to dial into the conference call fifteen minutes ahead of the scheduled start time | |
About Saratoga Investment Corp.
Saratoga Investment is a specialty finance company that provides customized financing solutions to U.S. middle-market businesses. The Company invests primarily in senior and unitranche leveraged loans and mezzanine debt, and, to a lesser extent, equity to provide financing for change of ownership transactions, strategic acquisitions, recapitalizations and growth initiatives in partnership with business owners, management teams and financial sponsors. Saratoga Investment’s objective is to create attractive risk-adjusted returns by generating current income and long-term capital appreciation from its debt and equity investments. Saratoga Investment has elected to be regulated as a business development company under the Investment Company Act of 1940, as amended, and is externally managed by Saratoga Investment Advisors, LLC, an SEC-registered investment advisor focusing on credit-driven strategies. Saratoga Investment Corp. owns two active SBIC-licensed subsidiaries, having surrendered its first license after repaying all debentures for that fund following the end of its investment period and subsequent wind-down. Furthermore, it manages a
Forward Looking Statements
This press release contains historical information and forward-looking statements with respect to the business and investments of the Company, including, but not limited to, the statements about future events or our future performance or financial condition. Forward-looking statements can be identified by the use of forward looking words such as “outlook,” “believes,” “expects,” “potential,” “continues,” “may,” “will,” “should,” “seeks,” “approximately,” “predicts,” “intends,” “plans,” “estimates,” “anticipates” or negative versions of those words, other comparable words or other statements that do not relate to historical or factual matters. The forward-looking statements are based on our beliefs, assumptions and expectations of our future performance, taking into account all information currently available to us. These statements are not guarantees of future performance, condition or results and involve a number of risks and uncertainties. Actual results may differ materially from those in the forward-looking statements as a result of a number of factors, including, but not limited to: changes in the markets in which we invest; changes in the financial, capital, and lending markets; an economic downturn or a recession and its impact on the ability of our portfolio companies to operate and the investment opportunities available to us; the impact of interest rate volatility on our business and our portfolio companies; the uncertainty associated with the imposition of tariffs and trade barriers and changes in trade policy and its impact on our portfolio companies and the global economy; the impact of supply chain constraints and labor shortages on our portfolio companies; and the elevated levels of inflation and its impact on our portfolio companies and the industries in which we invests, as well as those described from time to time in our filings with the Securities and Exchange Commission.
Any forward-looking statement speaks only as of the date on which it is made. The Company undertakes no duty to update any forward-looking statements made herein or on the webcast/conference call, whether as a result of new information, future developments or otherwise, except as required by law. Readers should not place undue reliance on any forward-looking statements and are encouraged to review the Company’s Annual Report on Form 10-K for the fiscal year ended February 28, 2025 and subsequent filings, including the “Risk Factors” sections therein, with the Securities and Exchange Commission for a more complete discussion of the risks and other factors that could affect any forward-looking statements.
Contacts:
Saratoga Investment Corporation
535 Madison Avenue, 4th Floor
New York, NY 10022
Henri Steenkamp
Chief Financial Officer
Saratoga Investment Corp.
212-906-7800
Lena Cati
The Equity Group Inc.
212-836-9611
Val Ferraro
The Equity Group Inc.
212-836-9633
Financials
| Saratoga Investment Corp. | |||||||
| Consolidated Statements of Assets and Liabilities | |||||||
| May 31, 2025 | February 28, 2025 | ||||||
| ASSETS | |||||||
| Investments at fair value | |||||||
| Non-control/Non-affiliate investments (amortized cost of | $ | 875,410,787 | $ | 897,660,110 | |||
| Affiliate investments (amortized cost of | 52,023,563 | 40,547,432 | |||||
| Control investments (amortized cost of | 40,883,612 | 39,870,208 | |||||
| Total investments at fair value (amortized cost of | 968,317,962 | 978,077,750 | |||||
| Cash and cash equivalents | 131,562,513 | 148,218,491 | |||||
| Cash and cash equivalents, reserve accounts | 92,724,212 | 56,505,433 | |||||
| Interest receivable (net of reserve of | 8,000,745 | 7,477,468 | |||||
| Management fee receivable | 294,307 | 314,193 | |||||
| Other assets | 1,369,594 | 950,522 | |||||
| Total assets | $ | 1,202,269,333 | $ | 1,191,543,857 | |||
| LIABILITIES | |||||||
| Revolving credit facilities | $ | 70,000,000 | $ | 52,500,000 | |||
| Deferred debt financing costs, revolving credit facilities | (1,037,309 | ) | (1,254,516 | ) | |||
| SBA debentures payable | 170,000,000 | 170,000,000 | |||||
| Deferred debt financing costs, SBA debentures payable | (3,831,484 | ) | (4,041,026 | ) | |||
| - | 20,000,000 | ||||||
| Discount on | - | (9,055 | ) | ||||
| Deferred debt financing costs, | - | (374 | ) | ||||
| 12,000,000 | 12,000,000 | ||||||
| Discount on | (35,844 | ) | (68,589 | ) | |||
| Deferred debt financing costs, | (4,346 | ) | (8,345 | ) | |||
| 5,000,000 | 5,000,000 | ||||||
| Deferred debt financing costs, | (5,860 | ) | (19,685 | ) | |||
| 175,000,000 | 175,000,000 | ||||||
| Premium on | 226,581 | 287,848 | |||||
| Deferred debt financing costs, | (653,235 | ) | (865,593 | ) | |||
| 75,000,000 | 75,000,000 | ||||||
| Discount on | (180,419 | ) | (213,424 | ) | |||
| Deferred debt financing costs, | (601,980 | ) | (688,786 | ) | |||
| 15,000,000 | 15,000,000 | ||||||
| Deferred debt financing costs, | (184,171 | ) | (202,144 | ) | |||
| 105,500,000 | 105,500,000 | ||||||
| Discount on | (77,798 | ) | (87,295 | ) | |||
| Deferred debt financing costs, | (1,347,571 | ) | (1,524,089 | ) | |||
| 46,000,000 | 46,000,000 | ||||||
| Deferred debt financing costs, | (840,029 | ) | (927,484 | ) | |||
| 60,375,000 | 60,375,000 | ||||||
| Deferred debt financing costs, | (1,053,557 | ) | (1,156,234 | ) | |||
| 57,500,000 | 57,500,000 | ||||||
| Deferred debt financing costs, | (1,170,572 | ) | (1,273,134 | ) | |||
| Base management and incentive fees payable | 6,869,845 | 6,230,944 | |||||
| Deferred tax liability | 4,994,417 | 4,889,329 | |||||
| Payable from open trades | 6,750,000 | - | |||||
| Accounts payable and accrued expenses | 1,556,106 | 1,676,335 | |||||
| Interest and debt fees payable | 4,598,538 | 3,909,517 | |||||
| Due to Manager | 553,706 | 349,189 | |||||
| Total liabilities | 805,900,018 | 798,878,389 | |||||
| Commitments and contingencies | |||||||
| NET ASSETS | |||||||
| Common stock, par value | 15,529 | 15,183 | |||||
| Capital in excess of par value | 421,664,914 | 412,913,597 | |||||
| Total distributable deficit | (25,311,128 | ) | (20,263,312 | ) | |||
| Total net assets | 396,369,315 | 392,665,468 | |||||
| Total liabilities and net assets | $ | 1,202,269,333 | $ | 1,191,543,857 | |||
| NET ASSET VALUE PER SHARE | $ | 25.52 | $ | 25.86 | |||
| Asset Coverage Ratio | 163.8 | % | 162.9 | % | |||
| Saratoga Investment Corp. | |||||||
| Consolidated Statements of Operations | |||||||
| (unaudited) | |||||||
| For the three months ended | |||||||
| May 31, 2025 | May 31, 2024 | ||||||
| INVESTMENT INCOME | |||||||
| Interest from investments | |||||||
| Interest income: | |||||||
| Non-control/Non-affiliate investments | $ | 25,464,663 | $ | 31,224,277 | |||
| Affiliate investments | 595,624 | 496,840 | |||||
| Control investments | 1,190,661 | 1,997,112 | |||||
| Payment in kind interest income: | |||||||
| Non-control/Non-affiliate investments | 168,229 | 63,830 | |||||
| Affiliate investments | 584,749 | 241,104 | |||||
| Control investments | - | 283,313 | |||||
| Total interest from investments | 28,003,926 | 34,306,476 | |||||
| Interest from cash and cash equivalents | 2,027,211 | 624,631 | |||||
| Management fee income | 705,175 | 804,456 | |||||
| Dividend income: | |||||||
| Non-control/Non-affiliate investments | 562,183 | 249,491 | |||||
| Control investments | 436,418 | 1,297,050 | |||||
| Total dividend from investments | 998,601 | 1,546,541 | |||||
| Structuring and advisory fee income | 264,375 | 410,843 | |||||
| Other income | 319,329 | 985,203 | |||||
| Total investment income | 32,318,617 | 38,678,150 | |||||
| OPERATING EXPENSES | |||||||
| Interest and debt financing expenses | 12,451,865 | 12,962,081 | |||||
| Base management fees | 4,333,332 | 4,982,580 | |||||
| Incentive management fees expense (benefit) | 2,536,513 | 3,584,734 | |||||
| Professional fees | 699,200 | 999,310 | |||||
| Administrator expenses | 1,250,000 | 1,075,000 | |||||
| Insurance | 74,310 | 77,596 | |||||
| Directors fees and expenses | 131,500 | 113,000 | |||||
| General and administrative | 645,411 | 609,127 | |||||
| Income tax expense (benefit) | 54,454 | (60,283 | ) | ||||
| Total operating expenses | 22,176,585 | 24,343,145 | |||||
| NET INVESTMENT INCOME | 10,142,032 | 14,335,005 | |||||
| REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS | |||||||
| Net realized gain (loss) from investments: | |||||||
| Non-control/Non-affiliate investments | 2,262,984 | - | |||||
| Control investments | 638,355 | (21,194,997 | ) | ||||
| Net realized gain (loss) from investments | 2,901,339 | (21,194,997 | ) | ||||
| Net change in unrealized appreciation (depreciation) on investments: | |||||||
| Non-control/Non-affiliate investments | 372,148 | 14,156,825 | |||||
| Affiliate investments | (45,944 | ) | 601,223 | ||||
| Control investments | 617,773 | (826,617 | ) | ||||
| Net change in unrealized appreciation (depreciation) on investments | 943,977 | 13,931,431 | |||||
| Net change in provision for deferred taxes on unrealized (appreciation) depreciation on investments | (55,085 | ) | (461,001 | ) | |||
| Net realized and unrealized gain (loss) on investments | 3,790,231 | (7,724,567 | ) | ||||
| NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS | $ | 13,932,263 | $ | 6,610,438 | |||
| WEIGHTED AVERAGE - BASIC AND DILUTED EARNINGS (LOSS) PER COMMON SHARE | $ | 0.91 | $ | 0.48 | |||
| WEIGHTED AVERAGE COMMON SHARES OUTSTANDING - BASIC AND DILUTED | 15,344,510 | 13,683,314 | |||||
Supplemental Information Regarding Adjusted Net Investment Income, Adjusted Net Investment Income Yield and Adjusted Net Investment Income per Share
On a supplemental basis, Saratoga Investment provides information relating to adjusted net investment income, adjusted net investment income yield and adjusted net investment income per share, which are non-GAAP measures. These measures are provided in addition to, but not as a substitute for, net investment income, net investment income yield and net investment income per share, respectively. These non-GAAP measures should only be used to evaluate the Company’s results of operations in conjunction with their corresponding GAAP measures. Adjusted net investment income represents net investment income excluding any capital gains incentive fee expense or reversal attributable to realized and unrealized gains. The management agreement with the Company’s advisor provides that a capital gains incentive fee is determined and paid annually with respect to cumulative realized capital gains (but not unrealized capital gains) to the extent such realized capital gains exceed realized and unrealized losses for such year. In addition, Saratoga Investment accrues, but does not pay, a capital gains incentive fee in connection with any unrealized capital appreciation, as appropriate. All capital gains incentive fees are presented within net investment income within the Consolidated Statements of Operations, but the associated realized and unrealized gains and losses that these incentive fees relate to, are excluded. As such, Saratoga Investment believes that adjusted net investment income, adjusted net investment income yield and adjusted net investment income per share is a useful indicator of operations exclusive of any capital gains incentive fee expense or reversal attributable to gains. The presentation of this additional information is not meant to be considered in isolation or as a substitute for financial results prepared in accordance with GAAP, and may be different from non-GAAP measures used by other companies. In addition, these non-GAAP measures are not based on any comprehensive set of accounting rules or principles. Pursuant to the requirements of Item 10(e) of Regulation S-K, the following table provides a reconciliation of net investment income to adjusted net investment income, net investment income yield to adjusted net investment income yield and net investment income per share to adjusted net investment income per share for the quarters ended May 31, 2025 and 2024.
| For the Three Months Ended | ||||||
| May 31, 2025 | May 31, 2024 | |||||
| Net Investment Income | $ | 10,142,033 | $ | 14,335,005 | ||
| Changes in accrued capital gains incentive fee expense/ (reversal) | - | - | ||||
| Adjusted net investment income | $ | 10,142,033 | $ | 14,335,005 | ||
| Net investment income yield | 10.3 | % | 15.5 | % | ||
| Changes in accrued capital gains incentive fee expense/ (reversal) | - | - | ||||
| Adjusted net investment income yield (1) | 10.3 | % | 15.5 | % | ||
| Net investment income per share | $ | 0.66 | $ | 1.05 | ||
| Changes in accrued capital gains incentive fee expense/ (reversal) | - | - | ||||
| Adjusted net investment income per share (2) | $ | 0.66 | $ | 1.05 | ||
(1) Adjusted net investment income yield is calculated as adjusted net investment income divided by average net asset value.
(2) Adjusted net investment income per share is calculated as adjusted net investment income divided by weighted average common shares outstanding.
