Q1 2024 Oxford Square Capital Corp Earnings Call
Okay.
Speaker Change: Good day, everyone and welcome to todays Oxford Square Capital Corp, first quarter 2024 earnings Conference call. At this time, all participants are in a listen only mode.
Speaker Change: Later, you'll have an opportunity to ask questions. During the question and answer session and you May Register at any time by pressing star one on your telephone keypad, you may withdraw yourself from the queue by pressing star Xu. Please note that this call is being recorded and I will be standing by should you need any assistance. It is now my pleasure to turn the conference over to Jonathan Cohen.
Jonathan H. Cohen: Please go ahead.
Jonathan H. Cohen: Good morning, everyone and welcome to the Oxford Square Capital Corp, first quarter 2024 earnings Conference call I'm joined today by Saul Rosenthal, our President Bruce Rubin, Our Chief Financial Officer, and Kevin Young and managing director and portfolio manager Bruce could you open the call with the disclosure regarding forward looking statements sure John.
Jonathan H. Cohen: Today's conference call is being recorded nor are they a replay of the conference call will be available for 30 days replay information is included in our press release that was issued this morning. Please note that this call is the property of Oxford Square Capital Corp.
Jonathan H. Cohen: Otherwise rebroadcast of this call in any form is strictly prohibited at this point. Please direct your attention to the customary disclosure in this morning's press release regarding forward looking information today's conference call includes forward looking statements and projections that reflect the company's current views with respect to among other things future events and financial performance, We ask who you were.
Jonathan H. Cohen: <unk> most recent filings with the SEC for important factors that can cause actual results to differ materially from those indicated in these projections, we do not undertake to update our forward looking statements unless required to do so by law.
Jonathan H. Cohen: To obtain copies of our latest SEC filings. Please visit our website at Www Dot, Oxford square capital Dot Com with that I'll turn the presentation back to Jonathan.
Jonathan H. Cohen: Thank you Bruce for the quarter ended March 31, Oxford square as net investment income was approximately $6 $5 million or <unk> 11 per share compared with $7 $8 million or 13 cents per share in the prior quarter.
Jonathan H. Cohen: Our net asset value per share stood at $2 42, compared to a net asset value per share of $2 55.
Jonathan H. Cohen: For the prior quarter during the quarter, we distributed 10.5 cents per share.
Jonathan H. Cohen: For the first quarter, we recorded total investment income of approximately $10 $7 million as compared to approximately $12 $2 million in the prior quarter.
Jonathan H. Cohen: In the first quarter, we recorded net unrealized depreciation on investments of approximately $210000 compared to net unrealized depreciation on investments of approximately $14 $8 million in the prior quarter.
Jonathan H. Cohen: In the first quarter, we recorded realized losses of approximately $8 1 million or <unk> 14 per share in the prior quarter, we recorded realized losses on investments of approximately 270000.
Jonathan H. Cohen: During the first quarter, our investment activity consisted of purchases of approximately $12 1 million sales of approximately $1 4 million and repayments of approximately $17 $9 million.
Jonathan H. Cohen: During the quarter ended March we issued a total of approximately 324000 shares of our common stock pursuant to an aftermarket offering resulting in net proceeds of approximately $924000.
Jonathan H. Cohen: On April 25, 2024, our board of directors declared monthly distributions of three and a half cents per share for each of the months ending July August and September of 2020 for additional details regarding record and payment date information can be found in our press release that was issued this morning with that I will.
Jonathan H. Cohen: Turn the call over to our portfolio manager Kevin you on it.
Kevin Young: Thank you Jonathan during.
Kevin Young: During the quarter ended March 31, 2024 U S loan market performance improved versus the prior quarter.
Kevin Young: U S loan prices as defined by the Morningstar LCA U S. Leveraged loan index increased from 96, 3% of par as of December 31, 2023 to $96 six 9% of par as of March 31 2024.
Kevin Young: According to LCD during the quarter there was some pricing dispersion with double B rated loan prices decreasing five basis points B rated loan prices, increasing 32 basis points and Triple C rated loan prices, increasing 134 basis points on average.
Kevin Young: The 12 month trailing default rate for the Morningstar <unk> U S leveraged loan index decreased to $1, one 4% by principal amount at the end of the quarter from 153% at the end of December 2023.
Kevin Young: We note that we have seen higher default rates amongst issuers of the type we invest and additionally, the distress ratio defined as a percentage of loans with a price below 80% of par ended the quarter at $3 five 1% compared to $4, 54% at the end of December 2023.
Kevin Young: During the quarter ended March 31, 2024 U S leveraged loans primary market issuance was 138 billion.
Kevin Young: Representing a 163% increase versus the quarter ended March 31 2023.
Kevin Young: This was driven by opportunistic activity, including refinancings and add ons, while M&A and LBO activity remained relatively slow but showed some recovery.
Kevin Young: At the same time U S loan fund inflows as measured by liver for approximately $2 billion for the quarter ended March 31, 2024, we continue to focus on portfolio management strategies designed to maximize our long term total return as a permanent capital vehicle. We historically have been able to take a longer term view towards our investment strategy with that I will turn the call back over.
Kevin Young: Jonathan.
Jonathan H. Cohen: Thanks, Kevin.
Jonathan H. Cohen: We note that additional information about Oxford square as first quarter performance has been posted to our website at Www Dot, Oxford square capital Dot Com.
Speaker Change: With that operator, we're happy to open the call for any questions.
Speaker Change: Thank you and at this time, if you would like to ask a question. Please signal by pressing the star one key on your telephone keypad, you may remove yourself from the queue at any time by pressing star Q.
Speaker Change: Once again that is star one to ask a question and we will pause for a moment to allow questions to queue.
Speaker Change: And we have no questions at this time I will turn it back to the presenters for any additional or closing remarks.
Speaker Change: Thank you we'd like to thank everyone for their interest in Oxford Square Capital Corp, and we.
Speaker Change: We look forward to speaking to you soon thank you very much.
Speaker Change: And this will conclude today's conference. Thank you for your participation and you now disconnect.
Speaker Change: Mhm.
Speaker Change: [music].
Speaker Change: Mhm.
Speaker Change: [music].
Speaker Change: Hello, Matt.
Speaker Change: [music].
Speaker Change: Yes.
Speaker Change: [music].
Speaker Change: Okay.
Speaker Change: Yes.
Speaker Change: [music].
Speaker Change: Yes.
Speaker Change: Uh-huh.
Speaker Change: Yes.
Speaker Change: Hum.