Saratoga Investment Corp. with Solid Results in the Second Quarter of 2025

Saratoga Investment Corp. recently presented its financial figures for the second quarter of the 2025 fiscal year. The earnings season conference call was led by Henri Steenkamp, CFO and Chief Compliance Officer, who outlined expectations for the company's current and future developments. The quarterly results center on the positive resolution of the last four problematic investments from the portfolio, which positively impacts the NAV per share. CEO Christian Oberbeck highlighted the strong dividend distribution, which, at an annual rate of USD 0.74 per share, implies a yield of 12.7%. The ongoing high interest rates and spreads of the predominantly variable rate investments continue to be advantageous, with long-term liabilities mostly fixed. The company took the opportunity to complete two new portfolio investments and, despite a low level of M&A activity in recent months, sees signs of an upward trend in the lower middle market sector. A solid portfolio worth USD 1.04 billion, supported by a robust balance sheet and a strong liquidity position of USD 162 million, supports these positive prospects. Despite economic challenges and a volatile environment, Saratoga is poised for future growth opportunities. Operationally, extensive restructurings have been completed, such as at Zollege and Pepper Palace, with new CEOs implementing strategically aligned changes. The proceeds from the completed sale of Netreo underscore the company's ability to complete investments with full capital return and a modest overall return. Overall, Saratoga's performance strength is evident in a 38.3% increase in adjusted net investment return.