Stellus Capital Investment (SCM) Q4 2025 earnings summary

Executive summary

• Reported Q4 2025 net investment income of $8.4 million ($0.29 per share) and $36.9 million ($1.30 per share) for the year, with a diversified $1.01 billion portfolio across 115 companies and stable asset quality.

• Announced a $20 million share repurchase program and the planned acquisition of the investment advisor by Ridgepost Capital, expected to close mid-2026, with current partners retaining operational control.

• Cumulative distributions since IPO reached $333 million ($18.27 per share), with a current annualized dividend yield of 14.4%.

• Portfolio remains diversified across 24 industry sectors, with no direct exposure to large-scale SaaS or oil and gas.

Financial highlights

• Q4 2025 investment income was $25.2 million, with net investment income of $8.4 million ($0.29 per share) and core net investment income of $8.5 million ($0.29 per share).

• Realized gains of $5.5 million on five equity positions, resulting in total realized income of $0.48 per share for the quarter.

• Net asset value per share was $12.82 at year-end, down from $13.46 a year earlier, with shares trading at approximately 0.74x NAV.

• Paid $333 million in dividends since IPO, equating to $18.27 per share.

• Weighted average yield on new debt investments was 9.5% in Q4 2025; weighted average yield on total investments was 8.7% at year-end.

Outlook and guidance

• Portfolio expected to remain at or slightly below $996 million in Q1 2026 due to slower M&A activity.

• Declared Q1 2026 dividend of $0.34 per share, with plans to maintain this level in Q2, subject to board approval.

• Regular monthly dividends of $0.1133 per share declared for January, February, and March 2026.

• Anticipates increased investment opportunities post-Ridgepost Capital transaction in the second half of 2026.

• Focus remains on originating first lien, senior secured loans to private middle-market companies.