Neostellar (NSLR) Q2 2024 earnings summary

Executive summary

• Net asset value (NAV) per share declined to $6.94 as of June 30, 2024, from $7.17 in Q1 and $7.35 in Q2 2023, reflecting portfolio depreciation and share repurchases.

• Net assets totaled $162.3 million at quarter-end, with 23,378,002 shares outstanding.

• $10 million was invested in Canva, Inc. and $15 million in CW Opportunity 2 LP (CoreWeave), positioning for a potential IPO market reopening.

• 2 million shares (7.9% of outstanding) were repurchased at $4.70/share via Dutch auction, reducing share count and enhancing shareholder value.

• Board approved a $35 million note repurchase program and up to $75 million in new 6.50% convertible notes due 2029, with an initial $25 million issuance.

Financial highlights

• Net investment loss for Q2 2024 was $3.7 million ($0.16/share), with a net change in unrealized depreciation of $7.0 million ($0.30/share).

• Net assets decreased from $181.7 million to $162.3 million during the quarter.

• Cash and cash equivalents were $54.4 million, representing 22% of gross assets.

• Top five positions accounted for 49% of portfolio fair value.

• Market value per share at quarter-end was $4.01, a significant discount to NAV.

Outlook and guidance

• Management expects increased IPO activity in late Q3 2024 and remains optimistic about the investment pipeline.

• Focus remains on late-stage technology, AI infrastructure, and high-growth, venture-backed companies.

• Ample liquidity is maintained to support near-term capital requirements, with $54.4 million in cash and $63.8 million in U.S. Treasury bills.