HOUSTON, Aug. 9, 2024
/PRNewswire/ -- Stellus Private Credit BDC ("Stellus PBDC" or
the "Company") today announced financial results for its second
fiscal quarter ended June 30,
2024.
Robert T. Ladd, Chief Executive
Officer of Stellus PBDC, stated "We are pleased to report strong
results in the second quarter in which we generated $0.46 per share of net investment income and
maintained a stable net asset value. During the quarter, we funded
$42 million of investments and
received $4 million of repayments,
bringing the total portfolio to $254
million at fair value. On June 26,
2024, we declared our 2024 third quarter monthly dividend of
$0.50 per share in the aggregate,
which represents an annualized dividend yield of approximately
13%."
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FINANCIAL
HIGHLIGHTS
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($ in millions, except
data relating to per share amounts and shares
outstanding)
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Three Months
Ended
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Six Months
Ended
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June 30, 2024
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June 30, 2023
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June 30, 2024
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June 30, 2023
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Amount
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Per
Share
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Amount
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Per
Share
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Amount
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Per
Share
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Amount
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Per
Share
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Net investment
income
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$3.86
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$0.46
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$2.68
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$0.44
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$7.42
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$0.95
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$5.33
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$0.92
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Net unrealized gain
(loss) included in earnings
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(0.41)
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(0.05)
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1.83
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0.31
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(0.09)
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(0.01)
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1.76
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0.30
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Benefit (provision) for
taxes on net unrealized depreciation (appreciation) on
investments
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(0.04)
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—
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—
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—
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0.01
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—
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—
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—
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Net increase in net
assets resulting from operations
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$3.41
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$0.41
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$4.51
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$0.75
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7.34
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0.94
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7.09
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1.23
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Distributions
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(4.08)
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(0.49)
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(2.72)
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(0.45)
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(7.69)
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(0.99)
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(5.03)
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(0.87)
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Other weighted average
share adjustments(1)
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—
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0.01
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—
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—
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—
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0.03
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—
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(0.01)
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Net asset
value
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142.6
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$15.19
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92.6
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$14.98
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142.6
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$15.19
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92.6
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$14.98
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Weighted average shares
outstanding
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8,310,559
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6,037,036
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7,768,883
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5,770,879
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(1)
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Includes the impact of
different share amounts as a result of calculating certain per
share data based on weighted average shares outstanding during the
period and certain per share data based on shares outstanding as of
the period end.
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PORTFOLIO
ACTIVITY
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($ in
millions)
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As of
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As of
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June 30, 2024
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December 31, 2023
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Investments at fair
value
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$254.2
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$208.6
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Total assets
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$257.3
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$211.2
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Net assets
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$142.6
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$108.0
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Shares
outstanding
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9,390,537
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7,102,136
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Net asset value per
share
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$15.19
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$15.21
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Three Months
Ended
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June 30, 2024
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June 30, 2023
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New
investments
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$41.6
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$24.4
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Repayments of
investments
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(3.7)
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(2.8)
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Net activity
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$37.9
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$21.6
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As of
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As of
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June 30, 2024
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December 31, 2023
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Number of portfolio
company investments
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49
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39
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Number of debt
investments
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47
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37
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Weight average yield of
debt and other income producing investments
(2)
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Cash
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11.6 %
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11.8 %
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Payment-in-kind
("PIK")
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0.3 %
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0.3 %
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Fee
amortization
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0.4 %
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0.4 %
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Total
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12.3 %
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12.5 %
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Weighted average yield
on total investments (3)
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Cash
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11.0 %
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11.2 %
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Payment-in-kind
("PIK")
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0.3 %
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0.3 %
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Fee
amortization
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0.4 %
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0.4 %
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Total
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11.7 %
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11.9 %
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(2)
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The dollar-weighted
average annualized effective yield is computed using the effective
interest rate for our debt investments and other income producing
investments, including cash and PIK interest, as well as the
accretion of deferred fees. The individual investment yields are
then weighted by the respective cost of the investments (as of the
date presented) in calculating the weighted average effective yield
of the portfolio. The dollar-weighted average annualized yield on
the Company's investments for a given period will generally be
higher than what investors of our common stock would realize in a
return over the same period because the dollar-weighted average
annualized yield does not reflect the Company's expense or any
sales load that may be paid by investors.
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(3)
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The dollar weighted
average yield on total investments takes the same yields as
calculated in the footnote above, but weights them to determine the
weighted average effective yield as a percentage of the Company's
total investments, including non-income producing loans and
equity.
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Results of Operations
Investment income for the three months ended June 30, 2024 and 2023 totaled $6.9 million and $5.2
million, respectively, most of which was interest income
from portfolio investments.
Gross operating expenses for the three months ended June 30, 2024 and 2023 totaled $4.2 million and $3.5
million, respectively. For the same periods, base management
fees totaled $0.8 million and
$0.7 million, income incentive fees
totaled $0.6 million and $0.5 million, capital gains incentive (reversal)
fees of less than ($0.1) million and
$0.1 million, which are not currently
payable, fees and expenses related to our borrowings totaled
$2.3 million and $1.8 million, respectively (including interest
and amortization of deferred financing costs), administrative
expenses totaled $0.1 million and
$0.1 million, and other expenses
totaled $0.3 million for both
periods. For the three months ended June 30,
2024 and 2023, the Company's investment advisor, Stellus
Private BDC Advisor, LLC (the "Advisor"), waived $0.8 million and $0.7
million of management fees (voluntarily waived until
October 1, 2024), $0.2 million and $0.2
million of income incentive fees (waived as our shares were
not listed on a national exchange), and $0.1
million and $0.1 million of
expenses pursuant to expense support and conditional reimbursements
from the Advisor for net operating expenses of $3.1 million and $2.5
million, respectively.
For the three months ended June 30,
2024 and 2023, net investment income was $3.9
million and $2.7 million,
or $0.46 and $0.44 per common share based on
weighted average common shares outstanding of 8,310,559 and
6,037,036, respectively.
The Company's investment portfolio had a net change in
unrealized (depreciation) appreciation of ($0.4) million and $1.8
million for the three months ended June 30, 2024 and 2023, respectively.
For the three months ended June 30,
2024 and 2023, net increase in net assets resulting from
operations totaled $3.4 million and $4.5 million,
or $0.41 and $0.75 per common share, based on
weighted average common shares outstanding of 8,310,559 and
6,037,036, respectively.
Liquidity and Capital Resources
On September 30, 2022, the Company
entered into a senior secured revolving credit agreement with Zions
Bancorporation, N.A., dba Amegy Bank and various other lenders (the
"Credit Facility"). The Credit Facility, as amended, provides for
borrowings up to a maximum of $150.0
million on a committed basis with an accordion feature that
allows the Company to increase the aggregate commitments up to
$200.0 million, subject to new or
existing lenders agreeing to participate in the increase and other
customary conditions. As of June 30,
2024 and December 31, 2023,
the Company had $113.0 million and
$98.0 million in outstanding
borrowings under the Credit Facility.
Recent Portfolio Activity
The Company invested in the following portfolio companies for
the three months ended June 30,
2024:
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Activity
Type
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Date
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Company
Name
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Company
Description
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Investment
Amount
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Instrument
Type
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New
Investment
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April 1,
2024
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FairWave Holdings,
LLC
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Specialty coffee
platform
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$
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3,084,350
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Senior Secured – First
Lien
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$
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1,079,522
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Delayed Draw Term Loan
Commitment
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$
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462,652
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Revolver
Commitment
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$
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115,663
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Equity
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New
Investment
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April 11,
2024
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WER Holdings,
LLC
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Regional provider of
commercial landscaping services
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$
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1,099,727
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Senior Secured – First
Lien
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$
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544,419
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Delayed Draw Term Loan
Commitment
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$
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163,326
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Revolver
Commitment
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$
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73,300
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Equity
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Add-On
Investment
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April 16,
2024
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Impact Home Services
LLC*
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Residential garage
door, electrical, and plumbing services provider
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$
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5,055
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Equity
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New
Investment
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May 10, 2024
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Luxium Solutions,
LLC
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Manufacturer and
distributor of high-performance advanced materials and
assemblies
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$
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3,372,885
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Senior Secured – First
Lien
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$
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488,117
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Delayed Draw Term Loan
Commitment
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Add-On
Investment
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May 16, 2024
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Impact Home Services
LLC*
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Residential garage
door, electrical, and plumbing services provider
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$
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2,527
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Equity
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New
Investment
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May 24, 2024
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Teckrez, LLC
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Distributor of
tackifier resins and acrylic monomers
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$
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1,755,164
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Senior Secured – First
Lien
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$
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586,521
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Revolver
Commitment
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$
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36,658
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Equity
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New
Investment
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May 28, 2024
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FiscalNote Boards
LLC*
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Facilitator of
executive-level in-person events and remote peer-to-peer industry
insights
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$
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77,109
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Equity
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New
Investment
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May 31, 2024
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TriplePoint Acquisition
Holdings LLC
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Provider of HVAC,
plumbing, and other mechanical and industrial services
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$
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4,246,034
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Senior Secured – First
Lien
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$
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1,061,509
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Delayed Draw Term Loan
Commitment
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$
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589,727
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Revolver
Commitment
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$
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442,295
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Equity
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New
Investment
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June 6, 2024
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Monarch Behavioral
Therapy, LLC
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Provider of
center-based applied behavioral analysis therapy
services
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$
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5,261,383
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Senior Secured – First
Lien
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$
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843,170
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Delayed Draw Term Loan
Commitment
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$
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562,114
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Revolver
Commitment
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$
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333,333
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Equity
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Add-On
Investment
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June 6, 2024
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Impact Home Services
LLC*
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Residential garage
door, electrical, and plumbing services provider
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$
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1,264
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Equity
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New
Investment
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June 13,
2024
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Said Intermediate,
LLC
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Digital transformation
consulting firm
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$
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5,818,182
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Senior Secured – First
Lien
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$
|
909,091
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Revolver
Commitment
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$
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272,727
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Equity
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New
Investment
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June 24,
2024
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AGT Robotique,
Inc.
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Manufacturer of robotic
welding solutions for metal fabrication industry
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$
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8,503,125
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Senior Secured – First
Lien
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$
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1,210,120
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Revolver
Commitment
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*
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Existing portfolio
company
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Events Subsequent to June 30,
2024
The Company's management has evaluated subsequent events through
August 9, 2024. There have been no
subsequent events that require recognition or disclosure except for
the following described below.
Credit Facilities
On August 1, 2024, the Company
entered into a Loan Financing and Servicing Agreement (the "Loan
Agreement") for a special purpose vehicle financing credit facility
(the "SPV Facility") by and among Stellus Private Credit BDC SPV
LLC ("Stellus SPV"), as borrower, the Company, as equityholder and
servicer, Deutsche Bank AG, New
York Branch ("Deutsche Bank"), as facility agent, Citibank,
N.A., as collateral agent and collateral custodian, Alter Domus (US) LLC, as collateral
administrator, and the lenders that are party thereto from time to
time. The SPV Facility provides for $50
million of initial commitments with an accordion feature
that allows for an additional $50
million of total commitments from new and existing lenders
on the same terms and conditions as the existing commitments.
Advances under the SPV Facility bear interest at three-month Term
SOFR (as defined in the Loan Agreement) plus an applicable margin
of 2.50% during the revolving period ending on August 1, 2027 and three-month Term SOFR plus an
applicable margin of 2.85% thereafter. The Loan Agreement provides
for an unused commitment fee, from the effective date of the Loan
Agreement through August 1, 2027, of
0.25% per annum on the unused commitments if Stellus SPV's credit
facility utilization is greater than or equal to 80%, and
otherwise, 0.50% per annum on the unused commitments, and other
customary fees. The SPV Facility will mature on August 1, 2030.
The outstanding balance under the Credit Facility and SPV
Facility as of August 9, 2024 was
$63.2 million and $50.0 million, respectively.
Distributions Declared
On June 26, 2024, our Board of
Directors declared a regular monthly distribution for each of
July 2024, August 2024, and September
2024, as follows:
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Record
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Payment
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Amount
per
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Declared
|
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Date
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Date
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Share
|
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6/26/2024
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7/1/2024
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7/31/2024
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$
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0.1666
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6/26/2024
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8/1/2024
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8/30/2024
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$
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0.1666
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6/26/2024
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9/2/2024
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9/30/2024
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$
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0.1666
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Sale of Unregistered Securities
Since June 30, 2024, the Company
sold 104,924 common shares of beneficial interest at a price of
$15.19 per share for aggregate
proceeds of $1.6 million, which
included less than $0.1 million of
organizational expense allocation pursuant to subscription
agreements entered into between the Company and investors.
Since June 30, 2024, the Company
also issued 8,014 common shares of beneficial interest for
aggregate proceeds of $0.1 million
under the DRIP.
About Stellus Private Credit BDC
The Company is an externally-managed, closed-end,
non-diversified investment management company that has elected to
be regulated as a business development company under the Investment
Company Act of 1940, as amended. The Company's investment objective
is to maximize the total return to its stockholders in the form of
current income and capital appreciation by investing primarily in
private middle-market companies (typically those with $5.0 million to $50.0
million of EBITDA (earnings before interest, taxes,
depreciation and amortization)) through first lien (including
unitranche) loans and second lien loans, with corresponding equity
co-investments. The Company's investment activities are managed by
its investment adviser, Stellus Private BDC Advisor, LLC.
Forward-Looking Statements
Statements included herein may contain "forward-looking
statements" which relate to future performance or financial
condition. Statements other than statements of historical facts
included in this press release may constitute forward-looking
statements and are not guarantees of future performance or results
and involve a number of assumptions, risks and uncertainties, which
change over time. Actual results may differ materially from those
anticipated in any forward-looking statements as a result of a
number of factors, including those described from time to time in
filings by the Company with the Securities and Exchange Commission
including the final prospectus that will be filed with the
Securities and Exchange Commission. The Company undertakes no duty
to update any forward-looking statement made herein. All
forward-looking statements speak only as of the date of this press
release.
Contacts
Stellus Private Credit BDC
W. Todd Huskinson, Chief Financial
Officer
(713) 292-5414
thuskinson@stelluscapital.com
|
STELLUS PRIVATE
CREDIT BDC
CONSOLIDATED
STATEMENTS OF ASSETS AND LIABILITIES
|
|
|
|
June 30, 2024
|
|
|
|
|
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(unaudited)
|
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December 31, 2023
|
|
ASSETS
|
|
|
|
|
|
|
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Non-controlled,
non-affiliated investments, at fair value (amortized cost
of
$252,191,163 and
$206,513,758, respectively)
|
|
$
|
254,154,676
|
|
$
|
208,574,078
|
|
Cash and cash
equivalents
|
|
|
565,106
|
|
|
593,685
|
|
Interest
receivable
|
|
|
1,918,469
|
|
|
1,495,581
|
|
Expense reimbursement
receivable from the Advisor (Note 2)
|
|
|
77,042
|
|
|
126,539
|
|
Deferred offering
costs
|
|
|
105,843
|
|
|
72,875
|
|
Related party
receivable
|
|
|
113,666
|
|
|
162,455
|
|
Prepaid
expenses
|
|
|
84,493
|
|
|
127,019
|
|
Receivable for sales
and repayments of investments
|
|
|
121,092
|
|
|
71,105
|
|
Total
Assets
|
|
$
|
257,263,779
|
|
$
|
211,223,337
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|
LIABILITIES
|
|
|
|
|
|
|
|
Credit Facilities
payable
|
|
$
|
112,219,734
|
|
$
|
97,031,517
|
|
Dividends
payable
|
|
|
—
|
|
|
3,551,068
|
|
Unearned
revenue
|
|
|
801,369
|
|
|
897,538
|
|
Income incentive fee
payable
|
|
|
445,911
|
|
|
439,854
|
|
Capital gains incentive
fee payable
|
|
|
291,758
|
|
|
261,684
|
|
Interest
payable
|
|
|
334,536
|
|
|
367,093
|
|
Administrative services
payable
|
|
|
131,543
|
|
|
124,958
|
|
Income tax
payable
|
|
|
51,769
|
|
|
182,489
|
|
Deferred tax
liability
|
|
|
164,066
|
|
|
167,865
|
|
Other accrued expenses
and liabilities
|
|
|
190,207
|
|
|
177,249
|
|
Total
Liabilities
|
|
$
|
114,630,893
|
|
$
|
103,201,315
|
|
Commitments and
contingencies (Note 7)
|
|
|
|
|
|
|
|
Net
Assets
|
|
$
|
142,632,886
|
|
$
|
108,022,022
|
|
NET
ASSETS
|
|
|
|
|
|
|
|
Common shares of
beneficial interest, par value $0.01 per share (unlimited
shares
authorized; 9,390,537
and 7,102,136 issued and outstanding, respectively)
|
|
$
|
93,905
|
|
$
|
71,021
|
|
Paid-in
capital
|
|
|
139,747,341
|
|
|
104,810,048
|
|
Total distributable
earnings
|
|
|
2,791,640
|
|
|
3,140,953
|
|
Net
Assets
|
|
$
|
142,632,886
|
|
$
|
108,022,022
|
|
Total
Liabilities and Net Assets
|
|
$
|
257,263,779
|
|
$
|
211,223,337
|
|
Net Asset
Value Per Share
|
|
$
|
15.19
|
|
$
|
15.21
|
|
STELLUS PRIVATE
CREDIT BDC
CONSOLIDATED
STATEMENTS OF OPERATIONS (unaudited)
|
|
|
|
Three Months
Ended
|
|
Six Months
Ended
|
|
|
June 30, 2024
|
|
June 30, 2023
|
|
June 30, 2024
|
|
June 30, 2023
|
|
INVESTMENT
INCOME
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest
income
|
|
$
|
6,844,595
|
|
$
|
5,158,773
|
|
$
|
13,153,976
|
|
$
|
9,890,725
|
|
Other income
|
|
|
86,125
|
|
|
62,484
|
|
|
195,721
|
|
|
238,553
|
|
Total Investment
Income
|
|
$
|
6,930,720
|
|
$
|
5,221,257
|
|
$
|
13,349,697
|
|
$
|
10,129,278
|
|
OPERATING
EXPENSES
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Management
fees
|
|
$
|
800,653
|
|
$
|
666,721
|
|
$
|
1,601,307
|
|
$
|
1,268,560
|
|
Income incentive
fees
|
|
|
642,470
|
|
|
468,011
|
|
|
1,240,871
|
|
|
907,677
|
|
Capital gains incentive
(reversal) fee
|
|
|
(7,817)
|
|
|
124,892
|
|
|
30,074
|
|
|
124,892
|
|
Professional
fees
|
|
|
128,021
|
|
|
168,703
|
|
|
324,932
|
|
|
380,511
|
|
Organization
costs
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,000
|
|
Amortization of
deferred offering costs
|
|
|
48,654
|
|
|
41,106
|
|
|
95,382
|
|
|
98,729
|
|
Administrative services
expenses
|
|
|
122,272
|
|
|
100,914
|
|
|
244,049
|
|
|
194,674
|
|
Trustees'
fees
|
|
|
40,000
|
|
|
40,000
|
|
|
80,000
|
|
|
80,000
|
|
Insurance
expense
|
|
|
20,197
|
|
|
20,307
|
|
|
40,393
|
|
|
40,391
|
|
Valuation
fees
|
|
|
1,559
|
|
|
615
|
|
|
28,718
|
|
|
18,274
|
|
Interest expense and
other fees
|
|
|
2,278,332
|
|
|
1,822,407
|
|
|
4,388,451
|
|
|
3,525,910
|
|
Income tax
expense
|
|
|
7,685
|
|
|
8,855
|
|
|
29,274
|
|
|
16,690
|
|
Other general and
administrative expenses
|
|
|
77,912
|
|
|
37,503
|
|
|
120,845
|
|
|
81,023
|
|
Total Operating
Expenses
|
|
$
|
4,159,938
|
|
$
|
3,500,034
|
|
$
|
8,224,296
|
|
$
|
6,738,331
|
|
Expenses
reimbursed/fees waived by Investment Advisor (Note
2)
|
|
$
|
(1,091,852)
|
|
$
|
(961,954)
|
|
$
|
(2,289,748)
|
|
$
|
(1,930,229)
|
|
Net Operating
Expenses
|
|
$
|
3,068,086
|
|
$
|
2,538,080
|
|
$
|
5,934,548
|
|
$
|
4,808,102
|
|
Net Investment
Income
|
|
$
|
3,862,634
|
|
$
|
2,683,177
|
|
$
|
7,415,149
|
|
$
|
5,321,176
|
|
Net realized gain on
foreign currency translation
|
|
$
|
6,403
|
|
$
|
7,846
|
|
|
14,845
|
|
|
11,321
|
|
Net change in
unrealized (depreciation) appreciation on non-controlled,
non-affiliated investments
|
|
|
(417,099)
|
|
|
1,819,403
|
|
|
(83,638)
|
|
|
1,747,377
|
|
Net change in
unrealized depreciation on foreign currency translations
|
|
|
(4,288)
|
|
|
(27)
|
|
|
(13,169)
|
|
|
6,193
|
|
(Provision) benefit
for taxes on net unrealized (gain) loss on investments
|
|
|
(42,087)
|
|
|
—
|
|
|
3,798
|
|
|
—
|
|
Net Increase in Net
Assets Resulting from Operations
|
|
$
|
3,405,563
|
|
$
|
4,510,399
|
|
$
|
7,336,985
|
|
$
|
7,086,067
|
|
Net Investment
Income Per Share – basic and diluted
|
|
$
|
0.46
|
|
$
|
0.44
|
|
$
|
0.95
|
|
$
|
0.92
|
|
Net Increase in Net
Assets Resulting from Operations Per Share – basic and
diluted
|
|
$
|
0.41
|
|
$
|
0.75
|
|
$
|
0.94
|
|
$
|
1.23
|
|
Weighted Average
Common Shares of Beneficial Interest Outstanding – basic and
diluted
|
|
|
8,310,559
|
|
|
6,037,036
|
|
|
7,768,883
|
|
|
5,770,879
|
|
Distributions Per
Share – basic and diluted
|
|
$
|
0.49
|
|
$
|
0.45
|
|
$
|
0.99
|
|
$
|
0.87
|
|
STELLUS PRIVATE
CREDIT BDC
CONSOLIDATED
STATEMENTS OF CHANGES IN NET ASSETS (unaudited)
|
|
|
|
Common Shares of
|
|
|
|
|
|
|
|
|
|
|
|
Beneficial Interest
|
|
|
|
|
Total
|
|
|
|
|
Number of
|
|
Par
|
|
Paid-in
|
|
distributable
|
|
|
|
|
shares
|
|
value
|
|
capital
|
|
(loss)
gain
|
|
Net Assets
|
|
Balances at
December 31, 2022
|
|
5,483,433
|
|
$
|
54,834
|
|
$
|
80,950,845
|
|
$
|
(742,722)
|
|
$
|
80,262,957
|
|
Net investment
income
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2,637,999
|
|
|
2,637,999
|
|
Net realized gain on
foreign currency translation
|
|
—
|
|
|
—
|
|
|
—
|
|
|
3,475
|
|
|
3,475
|
|
Net change in
unrealized depreciation on non-controlled, non-affiliated
investments
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(72,026)
|
|
|
(72,026)
|
|
Net change in
unrealized appreciation on foreign currency translations
|
|
—
|
|
|
—
|
|
|
—
|
|
|
6,220
|
|
|
6,220
|
|
Distributions from net
investment income
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(2,306,409)
|
|
|
(2,306,409)
|
|
Issuance of common
shares of beneficial interest
|
|
349,546
|
|
|
3,496
|
|
|
5,115,958
|
|
|
—
|
|
|
5,119,454
|
|
Balances at March
31, 2023
|
|
5,832,979
|
|
$
|
58,330
|
|
$
|
86,066,803
|
|
$
|
(473,463)
|
|
$
|
85,651,670
|
|
Net investment
income
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2,683,177
|
|
|
2,683,177
|
|
Net realized gain on
foreign currency translation
|
|
—
|
|
|
—
|
|
|
—
|
|
|
7,846
|
|
|
7,846
|
|
Net change in
unrealized appreciation on non-controlled, non-affiliated
investments
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,819,403
|
|
|
1,819,403
|
|
Net change in
unrealized depreciation on foreign currency translation
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(27)
|
|
|
(27)
|
|
Distributions from net
investment income
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(2,720,486)
|
|
|
(2,720,486)
|
|
Issuance of common
shares of beneficial interest
|
|
349,945
|
|
|
3,499
|
|
|
5,152,116
|
|
|
—
|
|
|
5,155,615
|
|
Balances at June 30,
2023
|
|
6,182,924
|
|
$
|
61,829
|
|
$
|
91,218,919
|
|
$
|
1,316,450
|
|
$
|
92,597,198
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balances at
December 31, 2023
|
|
7,102,136
|
|
$
|
71,021
|
|
$
|
104,810,048
|
|
$
|
3,140,953
|
|
$
|
108,022,022
|
|
Net investment
income
|
|
—
|
|
|
—
|
|
|
—
|
|
|
3,552,515
|
|
|
3,552,515
|
|
Net realized gain on
foreign currency translation
|
|
—
|
|
|
—
|
|
|
—
|
|
|
8,442
|
|
|
8,442
|
|
Net change in
unrealized appreciation on non-controlled, non-affiliated
investments
|
|
—
|
|
|
—
|
|
|
—
|
|
|
333,461
|
|
|
333,461
|
|
Net change in
unrealized depreciation on foreign currency translations
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(8,881)
|
|
|
(8,881)
|
|
Benefit for taxes on
net unrealized loss on investments
|
|
—
|
|
|
—
|
|
|
—
|
|
|
45,885
|
|
|
45,885
|
|
Distributions from net
investment income
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(3,610,362)
|
|
|
(3,610,362)
|
|
Issuance of common
shares of beneficial interest
|
|
255,902
|
|
|
2,559
|
|
|
3,901,680
|
|
|
—
|
|
|
3,904,239
|
|
Balances at March
31, 2024
|
|
7,358,038
|
|
$
|
73,580
|
|
$
|
108,711,728
|
|
$
|
3,462,013
|
|
$
|
112,247,321
|
|
Net investment
income
|
|
—
|
|
|
—
|
|
|
—
|
|
|
3,862,634
|
|
|
3,862,634
|
|
Net realized gain on
foreign currency translation
|
|
—
|
|
|
—
|
|
|
—
|
|
|
6,403
|
|
|
6,403
|
|
Net change in
unrealized depreciation on non-controlled, non-affiliated
investments
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(417,099)
|
|
|
(417,099)
|
|
Net change in
unrealized depreciation on foreign currency translations
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(4,288)
|
|
|
(4,288)
|
|
Provision for taxes on
net unrealized gain on investments
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(42,087)
|
|
|
(42,087)
|
|
Distributions from net
investment income
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(4,075,936)
|
|
|
(4,075,936)
|
|
Issuance of common
shares of beneficial interest
|
|
2,032,499
|
|
|
20,325
|
|
|
31,035,613
|
|
|
—
|
|
|
31,055,938
|
|
Balances at
June 30, 2024
|
|
9,390,537
|
|
$
|
93,905
|
|
$
|
139,747,341
|
|
$
|
2,791,640
|
|
$
|
142,632,886
|
|
STELLUS PRIVATE
CREDIT BDC
CONSOLIDATED
STATEMENTS OF CASH FLOWS (unaudited)
|
|
|
Six Months
Ended
|
|
June 30, 2024
|
|
June 30, 2023
|
|
Cash Flows from
Operating Activities
|
|
|
|
|
|
|
Net increase in net
assets resulting from operations
|
$
|
7,336,985
|
|
$
|
7,086,067
|
|
Adjustments to
reconcile net increase in net assets from operations to net cash
used in operating activities:
|
|
|
|
|
|
|
Purchases of
investments
|
|
(58,123,495)
|
|
|
(41,418,778)
|
|
Proceeds from
sales and repayments of investments
|
|
13,029,056
|
|
|
12,580,637
|
|
Net change in
unrealized depreciation (appreciation) on investments
|
|
83,638
|
|
|
(1,747,377)
|
|
Net change in
unrealized depreciation (appreciation) foreign currency
translations
|
|
13,169
|
|
|
(6,193)
|
|
Increase in
investments due to PIK
|
|
(333,142)
|
|
|
—
|
|
Amortization of
premium and accretion of discount, net
|
|
(299,811)
|
|
|
(221,155)
|
|
Deferred tax
benefit
|
|
(3,799)
|
|
|
—
|
|
Amortization of
loan structure fees
|
|
188,217
|
|
|
298,970
|
|
Amortization of
deferred offering costs
|
|
95,382
|
|
|
98,729
|
|
Changes in other assets
and liabilities
|
|
|
|
|
|
|
Increase in
interest receivable
|
|
(422,888)
|
|
|
(279,075)
|
|
Increase in
other receivable
|
|
(123,392)
|
|
|
—
|
|
Decrease
(increase) in related party receivable
|
|
48,789
|
|
|
(94,964)
|
|
Decrease in
expense reimbursements receivable from the Advisor
|
|
49,497
|
|
|
26,409
|
|
Decrease in
prepaid expenses
|
|
42,526
|
|
|
70,588
|
|
Increase in
administrative services payable
|
|
6,585
|
|
|
26,149
|
|
Decrease in
interest payable
|
|
(32,557)
|
|
|
(389,912)
|
|
Increase in
income incentive fees payable
|
|
6,057
|
|
|
30,837
|
|
Increase in
capital gains incentive fees payable
|
|
30,074
|
|
|
124,892
|
|
(Decrease)
increase in unearned revenue
|
|
(96,169)
|
|
|
68,341
|
|
(Decrease)
increase in income tax payable
|
|
(130,720)
|
|
|
8,390
|
|
Increase in
other accrued expenses and liabilities
|
|
12,958
|
|
|
7,771
|
|
Net Cash Used in
Operating Activities
|
$
|
(38,623,040)
|
|
$
|
(23,729,674)
|
|
Cash Flows from
Financing Activities
|
|
|
|
|
|
|
Proceeds from
issuance of common shares of beneficial interest
|
$
|
34,960,177
|
|
$
|
10,275,069
|
|
Offering costs
paid for common shares of beneficial interest issued
|
|
(128,350)
|
|
|
(131,095)
|
|
Stockholder
distributions paid
|
|
(11,237,366)
|
|
|
(4,115,942)
|
|
Borrowings under
Credit Facilities
|
|
67,100,000
|
|
|
72,000,000
|
|
Repayments of
Credit Facilities
|
|
(52,100,000)
|
|
|
(57,415,000)
|
|
Financing costs
paid on Credit Facilities
|
|
—
|
|
|
(352,744)
|
|
Short-term loan
repayments
|
|
—
|
|
|
(11,250,000)
|
|
Net Cash Provided by
Financing Activities
|
$
|
38,594,461
|
|
$
|
9,010,288
|
|
Net Decrease in Cash
and Cash Equivalents
|
$
|
(28,579)
|
|
$
|
(14,719,386)
|
|
Cash and Cash
Equivalents Balance at Beginning of Period
|
|
593,685
|
|
|
15,469,823
|
|
Cash and Cash
Equivalents Balance at End of Period
|
$
|
565,106
|
|
$
|
750,437
|
|
Supplemental and
Non-Cash Activities
|
|
|
|
|
|
|
Cash paid for interest
expense
|
$
|
4,232,791
|
|
$
|
3,616,852
|
|
Income and excise tax
paid
|
|
159,994
|
|
|
8,300
|
|
Increase in deferred
offering costs
|
|
32,968
|
|
|
32,366
|
|
Value of common shares
of beneficial interest issued pursuant to Dividend Reinvestment
Plan
|
|
780,177
|
|
|
155,615
|
|
(Decrease) increase in
dividends payable
|
|
(3,551,068)
|
|
|
910,953
|
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SOURCE Stellus Private Credit BDC