Earnings call transcript Q4 2023

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Operator

Good morning, ladies and gentlemen. Thank you for standing by. Welcome to Saratoga Investment Corp.'s 2023 Fiscal Year End and Fourth Quarter Financial Results Conference Call. Please note that today's call is being recorded.

During today's presentation, all parties will be in a listen-only mode.

we the remarks, for prepared management's will line open questions. Following

Henri turn time, Financial over Mr. go I’d this the and Sir, ahead. like Officer, Chief At Corp.'s to call please Investment to Compliance Steenkamp. Saratoga

Henri Steenkamp

refer you. statements cause Saratoga SEC Corp.'s We by recent to ask unless to important and to fourth for actual filings earnings projections. could forward-looking XXXX welcome conference Today's projections. to results and Investment conference do law. end We I call. would to year call materially Thank that to quarter and update the do these from so everyone with required our like to statements differ most fiscal factors includes undertake our you forward-looking statements forward-looking not

call. be a we during our Today, presentation referencing will

You earnings release our refer year-end our the A call and fourth to Presentations shareholder Relations available. this of XXXX for press page of our IR will night. details. fiscal is link Events also conference Please release quarter press website. presentation be our distributed the Investor last in section A replay to earnings can find and in

now like Chairman Chief will the Officer, call to over and who few to be Christian our Oberbeck, introductory a turn Executive making remarks. would I

Christian Oberbeck

balance reflects credit total which and of being the of and are and and year's you, rates Thank our rates, year as outpaced Henri, fourth in the assets under investment increases dividend XX% floating of to quarter increases compared adjusted recent effects last equity. management, assets XX% the are rising net on positive our that last and significant welcome everyone. Saratoga’s share XX% XX% income respectively, per

margins investment terms Higher interest at our attractive interest increasingly pricing, portfolio to importantly, higher and financing on improving abundant rates. and general available an opportunities and producing credit and the sponsors from largely a rates of paid In absolute of contraction flow contrast on rising are rates fixed liabilities. high-quality

of and for only, is environment. years importantly, covenant-free, maturities interest particularly higher potentially interest two of this since the sponsors largely with structure, rising performance demonstrating long-duration at segments. nature solid our in to X.X% portfolio, underwriting of an industry last decline incorporating environment high-quality the challenging resilience XX our rate us growing NAV reflected portfolio longer our in just strength share positions well-selected for out, year, credit Saratoga's per foundation and and debt, the of in and in Most well companies

many QX, adjusted $X.XX year in QX, X.X% end, share from per further $X.XX of by per QX including per This up first, are portfolio increasing continuing to to to performance indicators since share. share sequential XX% increases this share, in year past and up per $X.XX quarterly is manifested in resilience record evidenced XX% our from effects NAV key NII from These positive $XX.XX. and $X.XX

Second, current billion. assets management under growing to $X over

business grade offerings debt available growth, million to to receipt maintaining rating, third markets support BBB+ capacity mission. our in further our since, $XXX of license, raised the to year, million compared Third, per $XXX increases fixed QX recently NII. adjusted in callable rate, from this earned up share, to XX% in quarter's per six volatile investment our of providing while consistent $X.XX Fourth, SBIC long-term support record small XX% with as and share SBA's in dividend $X.XX over capital, by and XX% last portfolio,

overall well value fair existing above companies generally cost. are with Our our X% portfolio performing

the quarter. be new on extensively to continue highly in we of current commitments terms We something throughout discerning environment, the focused in

sheets we including business totaling have in follow-on portfolio $XXX companies portfolio ones balance closed with strong numerous approximately many and well. remains XX while end, million, pipeline five this slightly decreased our robust know million actionable since quarter with opportunities, AUM quarter companies $XXX existing investments, new Our to and models and we

historically And structured quarter of is uncertainty. in our in situations. values at that by economic conditions and balance with have supported and from sheets, well future strong and industries portfolio enterprise believe in XX% well our lien first performed end generally investments stressed We

quarter cushion quarter adjusted May annualized net $X.XX $X.XX supports and dividend and of of yield, investment events. imply per earnings per the of by The provides and based increased against price NAV, on its over-earning dividend share dividend per $X.XX Saratoga’s annualized yield, XXXX. income share, XX.X% fourth stock on share, recent XX.X% also dividend or share, of increases an X, the per $X.XX a level, adverse $XX.XX this

quarter slide on To two. briefly past the recap

foundation of average remaining our $XX.X financial total million generating rating of market strengthen high gross syndicated on on of non-accrual; loan realizations our recognizing $X.X the XX the CLO quality only our BDC XX.X% investments highest retaining volatility XX.X% a X.X%; level maintaining continue JV, of and portfolio registering in reflecting basis with versus net and unrealized primary and the at million investment a we and credit the $X.X First, gross total by a on million quarter-end, equity loan IRR of of our X.X% appreciation million. on IRR and on industry unrealized with on a QX $XXX return one by portfolio trailing month poor broadly unlevered in appreciating unlevered XX% a to investment with credit

a net million and XX% under million, close year we've AUM this bringing added last originations quarter, $XXX to $XXX $XXX billion. last decrease total your end, X% of increase to Second, as Subsequent our a $X.X quarter. million from from management to assets of million increased to $XXX

NAV strength, currently us. experiencing, volatile we sheet liquidity in for Third, economic conditions as paramount such and preservation remain are balance

mark-to-market long-term was supporting structure $XXX of covenant-free borrowings. covenant-free $XXX equity, debt, of debentures [ph] end revolving million million long-term million of at non-SBIC $XX.X year million long-term strong. $XXX capital Our and SBIC of

discretionary $XX are funding companies $XX with committed outstanding facilities million, total Our undrawn and existing million lending to committed $XXX and million portfolio discretionary.

a at rate a solid or environment cost fixed with well positioning economic overall structure should from schedule favorable maturity credit challenges for years ranges providing XX debt out, terms, Our two to and arise. rising both a us

in million February XX, for revolving available investment XXXX facility had capacity SBIC our expanding trading And million newly fund, with baby of credit expanded and At approved new to and new support million companies, the further a Ticker of we million our we liquidity under to public million $XX private $XX.X subsequent $XX.X base, bonds cash. $XXX our available in bond $XXX a III portfolio quarter-end, issued $XX dollar baby SAZ. million

the largest declared paid the XXXX. $X.XX quarter, last or quarter-ended March was based XX, of Board on which increase performance our and X.X% on XXXX, share dividend XX, from ever, of quarterly liquidity, $X.XX for Directors per an a Finally, dividend of overall quarterly and our February

XX, Saratoga quarter within compared quarters XXXX. our strong as Investment's XXXX, demonstrated to the XX, fourth performance indicators key February and ended November performance

NII $XX.X this is Our and quarter, million XX% last last up year, from up XX% adjusted dollars quarter. from

XX% quarter, Our and XX% this last up quarter. adjusted NII $X.XX $X.XX is from $X.XX up share year from last per

XX per from on to down from detail NII NII our and X% is per last Latest and from from from share up share our $XX.XX, $X.XX up last and and X.X%, down return and Comparing more equity months XX% X.X% is to million later. provide $XX.X year, quarter. XX% XXXX $XX.XX will NAV million, adjusted $X.XX, from we is $XX.X quarter, XX.X% last up adjusted last and XXXX, is up $XX.XX X.X% year, fiscal

last X, consistently steadily on Slide since As over assets our years quarter. see have XX we risen credits our almost as the the can on under and only the ago, quality same you remains non-accrual, high, credit management and with took of BDC one

growing is team diligently and evolving management into same our this trend working time our Our deploy as the positive to while credit cautious being this appropriately pipeline, we at available environment. in capital continue volatile

Henri review as like back the of our financial over to the and our to With portfolio. I composition to well results, turn that, would performance call now as

Henri Steenkamp

ended Thank up fiscal and you, quarter, metrics related highlights year's was gains, million the XX, of When XX.X% QX. adjusted X up the net last for accrual XX.X% Slide from adjusting quarter incentive performance key NII fee February XXXX. for last to $XX.X from capital our Chris. fourth

the and per weighted were unchanged. $X.XX dilution repurchases up to this and common last quarter, accretion share issuances from share DRIP the NII last per up There on from share shares year. outstanding or $X.XX quarter. Adjusted was shown relatively per due slide, share zero Across was three quarters $X.XX, $X.XX average $X.XX

income other million in Wax including rate NII investment from increased AUM. The increase coupon and increase Adjusted X.X% redemption $X.X dividend as on generated XX.X% this from significantly in increase fee XX.X% included some the resulting Artemis both income compared income an to with XX.X%, in quarter. primarily year, equity non-CLO investments with last the that in spread and sale the current BDC from a increase increases, base and

the is from not increased This base The of all year and and full the during fees various in debentures notes X.X% changes fully as quarter. interest still resulting is was issued SBA offset past rates higher up management year. reflected new income. XX.X% reflect by on XX.X% AUM and benefit interest Sequential expense yet from the Adjusted year-over-year, coupon in increase This last NII the yield quarter XX.X%. current was with same from to quarter XX.X%. yield last factors and partially

million a $XX.X from $X.X of net million or share. we net a net our $X.X share, resulting assets comprised on million quarter, loss increase I unrealized or our appreciation million net as $X.X debentures, weighted total operations repayment by per million to primarily SBIC investments on extinguishment $XX.X of investments investments, resulting gain in we $X.XX SBIC wind a down the first fourth $XX.X of $X.XX this borrowings offset fund. For on from per of was on experienced in million The of of in average continue gain

$X.X each the primarily Axero Procurement the CLO the $XX.X and Controls net portfolio. $X.X as million appreciation in unrealized appreciation appreciation reflecting company's three, across company's the Altvia loan million equity on Holdings reflects, and on approximately performance. realized on the of JV the Partners million Vector market company's the in syndicated and the investments, of $X.X net respectively, unrealized quarter million $X.X company Two, end. reflecting the And $X.X unrealized investments, primarily the Midco appreciation million appreciation million all remainder unrealized broadly and first, Investments volatility and of The

equity remains a realized on unrealized us, Return includes for us, both indicator which performance and gains. indicator very important for

X.X% equity beating Our last XX industry the was on of the average X.X%. return months, for

fees X.X% last X.X% up excise last $X.X financing and QX, and total unchanged quarter. debt for as income X.X% million last million annualized for fees, was This quarter. interest and and slightly management base assets and represented an year expenses from taxes for Total incentive $X.X average basis, compared expenses, last to $X.X from of and year million, excluding QX on

over of the months, also of full and same quarters Slides our than full XX% the to putting presentation and quadrupled sheet through fiscal is the upward and metrics of impact management we has at period continued while receiving end rising XXXX since current A again Slide for XX the run for interest has more key added the the past BDC shows took how Also, XX QX amount Saratoga we yet nine XX rate balance the that the statement still XX, work net cash, year. increase note have benefit the the not the to last KPI appendix environment. particular increased nor Slide the margin the highlights the in and income trends maintained. our by rate full highlighting of performance of have significant metrics X

quarter $XX.X on was million Slide X, from an an end, to $X.X quarter and as $XXX.X million last same of last year. NAV moving And increase decrease from million the quarter

main by were offset partially unrealized drivers of appreciation gains $X.X of million $X.X net realized $XX.X declared. investment net and of million the million quarter, dividends income, This and

made of down at end, per $X.X million stock were $X.X and $XX.XX distributions up offset months from from XX shares as quarter. of was plan, an by QX, average of during of share $XX.XX. company's last $XX.XX ago addition, repurchased through price dividend $XX.XX DRIP In the million NAV quarter

per quarters. includes chart our This XX of XX NAV also past which highlights increased share, historical the this has

per consistent the value has accretive steadily since this term, in been asset growth NAV and the has share. as net demonstrated Over XXXX, increase long by increased our

realized gains. unrealized continue history from We of to consistent and benefit our

you other Main Starting calendar in net the income, simple of impact and in NII XXXX incurred higher a main the rates, Artemis redemption AUM a in decrease were fees NAV X, $X.XX a per Slide adjusted quarterly the increased major On $X.XX excise increase interest basis. and will non-CLO interest reconciliation top, of received. offset income $X.XX year. from from NII to per see share. partial share per The was dividend the on drivers a for at and due changes increase the and to sequential from primarily $X.XX taxes $X.XX Wax share a

the of NAV paid primarily lower unrealized and on gains dividend the increase realized $X.XX to Moving of the for appreciation $X.XX per slide, $X.XX of share by the of NII quarter. reconciles $X.XX net GAAP in this QX. was the offset half

were sequential On per adjusted you see and the from and $X.XX interest higher fees. interest reflecting share Slide a The interest non-CLO increase a same $X.XX Starting increased NII AUM per net in year last a annual will share top, $X.XX on year. in primary share basis. X mainly but at net $X.XX decrease decrease drivers $X.XX now rates, income the this management to from base reconciliation, CLO offset higher income per by

$X.XX GAAP $X.XX the net of on investments was dividend by a was in XXXX. slide, reconciles the net There accretion $X.XX On per the and gains and year. depreciation offset realized this the paid plan during DRIP unrealized and of lower year. decrease the $X.XX the of primarily NAV share from share the issuances for NII repurchases $X.XX half fiscal

between Slide available of quarter credit the and cash, which debentures X undrawn available was million. undrawn spread as our facility. us dry totaled secured end, to outlines $XXX.X This SBA powder

also level cost additional available $XX.X external end million thus grow and liquidity for available with quarter cash to and us without need SBA with accretive low $XXX deployed, end debentures our its an by the available of accretive. allows of quarter to This of fully when million NII pricing, assets very financing, XX%

to to within Capital agreement Encina the entered also improvements agreement. number achieve to In credit amendment January, a in important order the first this into of we

First, borrowings $XX million $XX we to from increased available million.

Second, applicable importantly, X% a And rate from period from revolving we borrowings the to bps underlying for benchmark we interest X.XX%. changed margin XXXX. one-month plus compute a the used effective spread increased the SOFR to to XX LIBOR adjustment tenor credit January Term to on extended and

additions we've year available mentioned made before, As to since we've our of a important liquidity number end.

totaling outstanding investments investment market and a We companies million strategies, under The purposes. baby our these middle proceeds $XX.X baby $XX.X facility, the accordance to undebtedness used repay public bond under a offerings are bonds have million, made portion including SBIC and issued being new III for credit in of XXXX proceeds net SAZ. ticker in including objective make corporate net through of investments with for $XX.X trading X.X% of million, general the

with diverse our the in available position, that The years and maturing coupons, such rate volatile sheet. We higher that available importantly no and conservative structured way be in nature, a including times. with is Also, our balance stressed is our next of all two private this the is BDC remain during and in almost debt within into sources rate especially and debt such pleased call to have rising next both covenants almost liquidity, nature non-SBIC fixed public with that in years, almost debt our fact of on leverage overall all options no access we debt taking liquidity with environment. can X.X our important and our that debt the account long-term the

companies, XX one Now, invested XX one value to of and I CLO million our would highlights AUM yield and venture. $XXX of investment in joint portfolio that like on Slides portfolio. we and Slide $XXX XX now cost, fair the at review to million have at XX or move fund through composition

of is of which out lien is percentage Our investments, first XX% positions. lien first our last in XX% total

low CLO those tightening time, assets, trends After are reverse. can quarter. excluding has rates period XX, an of seeing spreads, the how especially extended changed we Slide and the BDC our On both see on core over yield you our past

rate QX not We today in last increasing XX.X% rising quarter. with last Total seen QX benefit our fully environment to yield our portfolio yield in quarter. have core the reflected and last and to full XX.X% earnings. BDC XX.X% still from last the and much of through impact year XX.X% X.X% from But is already year increased X.X% yet from has

NII, floors we benefit interest-earning above variable all rise rates In our with end, widening, to going we rate, expect addition, portfolio continuing market see of X.X% being their spreads yield of can quarter, from The unchanged impact the seeing CLO are is our you last stayed slide. and our on rising reflecting forward as of since performance. investments The XX% the and current. being earnings CLO at rates versus next to current year to performing

was XX% approximately using the XX basis points in how at points assets average variable impacted closed used while SOFR in LIBOR With the are three benefit quarter and base QX versus $XX.X XXX. at our by Slide but end at will this interest-earning not basis at additional increases rates. quarter these month be will of is increase of similar. borrowing when portfolio end The QX, versus fixed and our end from and XXX today all of shows three XXX LIBOR earnings rates in rate our month in rates, QX, million increase base

about gain uncertainty be rate timing to to said, future in and but to will effect terms. rates our we lag there rates, a of dynamic the resets the of due this That is continue There of has stand earnings on invoicing rise. as

how shows and XX diversified the you the And our industry our U.S. can see diversity investments breadth on portfolio Slide XX Slide that are represents. throughout

in distinct as the XX education, Our estate, investments which focus real addition CLO and HVAC our JV, with in and to services and healthcare on IT, securities. and are services, software, included and a structured finance industries spread over investments consumer large sales education healthcare are

portfolio, which important consists our XX.X% part of equity an remain investment Of interest, investment total strategy. of our overall now

gains a accretive fully historical of or net of total early capital other carry-forwards of had $XX.X were the we years, of sale over realized management equity And were from gains Saratoga carried due million redemption interest unused to the the sale BDC. over these NAV when For investments. to the two-thirds XX that loss combined past from or took fiscal of

to grow of realized our NAV continue loss year-end performance portfolio We million helped have long-term and capital has credit This our in highlights as a consistent gain is healthy ROE. for tax $X.X purposes. reflected our quality

That the over the Investment will Grisius, review. Chief to overview financial turn Michael I an portfolio call of concludes and Officer, now investment market. for our my

Michael Grisius

premium then to market update take Thanks, become comment portfolio current Silicon I'll strategy. for surrounding only have state persists. competition of The to Since our already last decline on banks market investment though describe high-profile the few bearish quality has led crisis macro our a credits minutes less and on deal served in January, markets to lenders recent and our Henri. marginally Valley volume current perspective that performance a prevailing signature due to exacerbate and the aggressive, in factors. has

abundant sectors Liquidity especially fundraisings their risk-sensitive, reduced deployment, of remains and last use large-scale the some stance taking in hold year, are value, volatile more of capital. Lenders equity and their as as a off but after capitalizations enterprise of cases well lenders backing the and of historically requiring regardless are on the have harder pace being banks greater positions.

All of way been very and opportunities positive actionable pipeline. come we a these attractive more as our factors us deal are have for have seeing

growing seeing and another on ago. rate the to XXX side, come SOFR slides have margin, last are couple LIBOR Leverage as the points levels is Henry Absolute since significantly we a down appear have yields quarter. where are basis as increased mentioned at greater movement but of

in lower and markets. in to been it the middle had markets capital where to up continuing are broader market happening syndicated widen spreads addition, In the mainly recently

aggregate continue market as ways, to timing close That restrictions. said, covenant potential equity part financing In remain deals disciplined recession. wary such mature are in staying investors differentiate particularly lenders and most capitalized concerns of minimum of of our competitive to looser a economic the other accelerated and a in requiring in thinly and base terms covenants, given and the themselves reasonable market, levels for around

labor of, that number credit made being importance us first, second, has decisions; managed disciplined has experience team being cycles and of a making particularly of management Saratoga The investment when aware successfully the and a rates through slowing affect portfolio keeping continued watchful and in on our portfolio. We're both managing how prospective costs, rising supply pressures eye issues, and very chain existing could growth and proactive inflationary companies.

through existing focus natural is supporting our currently on companies portfolio follow-ons. Our

this our As where quarter nearly seen was all capital deployment. comprised of it

position have a confidence entering credit our environment. strong We rate changing and in

bar of trend a discuss to that Calendar find Our opportunities as we environment deploy and very pace underwriting us, pace we XXXX see originations, capital into will high continue we to remains was yet year XXXX. as a with of usual, for and shortly. strong continue deployment strong

an XXXX, XX the with as business and be sheets avenue to Follow-on capital with calendar first follow-ons of balance deployment, existing delayed and important last models of draws. demonstrated investments borrowers XX in quarter in follow-ons strong year continue including

past nine in calendar In addition, in investments QX. and year, in new we have invested platform new another platforms this four

contact be portfolio to important, teams, volatile market management with remain continues and management environment. and we our engaged companies, actively Portfolio our with close this critically in in especially

portfolio we our remains paying Nolan for pick according a as of loans nonaccrual for nonaccrual, our our time. portfolio. payment interest on their of to terms, to are investment only across our our moved Nolan All have in investment period is except that

reflects portfolio primarily this certain X% believe performance recognizing overall assets cost unrealized attributes are basis. strong now the Saratoga's our our on of After this quarter, from performance overall We above appreciation, durability. strong values supported first industries in debt in lien its of that historically bolster by that overall portfolio performed is XX% and our in situations. have stress portfolio well enterprise generally

commodities We direct exposure. or have no energy

comprised the majority recurring that businesses of degree have produce high strong of retention. addition, and is demonstrated portfolio a historically of our revenue In revenue

the at Our always as a of our to cost. of our quality stay resulted portfolio space respect realized focused on BDC on to and see underwriting, being can you with as Slide this gains portfolio XX, approach in and top net the approach the performance been has has percentage of

number of one past have three had BDCs only that positive the years. are We a XX over

characteristics. with remains as its always adjusted to as the a the management our accurately endeavor possible producing strength company working culture in and underlying its for underwriting and the deeply business durable strong with businesses, this assess model. to invested of the at returns and We long-term of investment ownership order business long into peer accretive term. thoroughly sought Now Saratoga. strengths directly over the each have objective and capital understand paramount shareholders We We to best approach risk

Our XX% our quality our opportunity, companies volatility shows we portfolio only strategy intend of co-investment portfolio portfolio highest believe of market when and of but current and end. and when internal in we co-invest credit as at strategy credit the as impact portfolio, the of rating protection previous our in to meaningfully the investment the our and strategy. equity given demonstrated of has upside continue that equity we're for also rating to quarter this our potential. the is This augmented selectively equity our reflects yield one, returns as not served Part overall slide on

industry overall Nolan XX, Looking portfolio leverage multiples X.XXx, for at high have was Total around while our Pepper on you is Xx levels. industry leverage excluding from year Slide see their historically debt come can the and that at now slightly end leverage. down Palace,

Through able past a been we've maintain relatively risk throughout. profile to modest volatility,

in Although enterprise exceed we value return investing sustainably confident with strong the on dollar the investment. are businesses business and credits consider our in isolation, focusing rather we models, where of leverage attractive profiles of exceptionally the last risk will never

competitive dynamics. market our of slide the flow despite new over and this addition, increasingly consistent strengths term, and our illustrates investments the ability generate to ever-changing In long deal

we're investments calendar environment, we're having to of that and sake. always, year's well macroeconomic businesses cyclical XX last with success the increased the quarter, are pace. focused durable companies new we in pressures. to face keenly and attractive growth's exposure highly four simply grow of aiming we ahead are businesses added for follow-on and uncertain already first emphasize important as our deal we're and seeing, flow and it to made in Despite During is the investing investing not inflationary portfolio, this growing portfolio the on limited In

our be deployment high and investment confidence Our capital incremental to accretive is that will shareholders. upon bar is always each healthy conditioned

to Slide new experience sources to our become our continue skill relationships deals. set, on to XX, has have development relationships on multiple Moving mature team's of that significant and led companies to pleasing strategic XX business the is focus development What formed portfolio are from newly past especially notable we new our progress reflecting business us of over expand the XX efforts. relationships, six months as and is

quality to efforts top attracting remains focused notably, percentage dropped number has our number results. recent markedly past deals but to the this executed pace, from last Most more is due years, in opportunities. recently of COVID, focus more reflecting of on line of higher a the Our months deals two that initially sourced during year's but robust, yielding up strategy the is demonstrating

net including In addition this in of of to follow-ons, million and growth new have for companies increase $XXX $XXX draws, delayed since our million. five past portfolio investments approximately year, end, and XX a had executed in fiscal we in quarter originations new $XX million one repayment

our on is Saratoga gross realizations. made portfolio the unleveraged credit of see remains by Slide IRR million quality on Investment unrealized solid. XX, XX.X% can $XXX Team overall you investments As The Management

unlevered SBIC XX.X%. IRR can investments the combined weighted of On you million right, BDC is on gross the see our on $XXX chart unrealized and the total

the quarter been has added our this yellow since yellow and two to of was for a rated change was The fundamental not our prospects to business. the to current the of at depreciation QX. investments, nonaccrual mark in-person for business change being earlier also significant There long-term COVID, investments. company, reflects Nolan still and year. Nolan does no view As but of the Palace have only being the unrealized more performance while interaction status this continue now dependent current we on Pepper

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company with performance. sponsor and working to improve the the are as work closely they We

Our overall investment returns and capital. approach our has invested yielded exceptional realized recovery of

of to cash X deployed SBIC first are second and $X.X can the see million cash SBIC distribution SBIC and BDC with fully funded available $XX.X to on licenses X in you XX, of million Moving respectively. slide and our and for

approval to ventures access also year, practically low-cost we for SBA this businesses. U.S. of are SBIC pleased We have allowing our million license means another $XXX received small to third currently, have continue to to support which us

and the portfolio our way to subsequent durable of market team, the and of strength resilient summarize the due both impact against overall really and itself COVID-XX XXXX and our the and proven the and XXXX underwriting platform volatility To calendar portfolio, adjustments the has and quarter, diligence underscores early be procedures.

a new bar, increased primary remain premium flux, asset in now. have intensely Credit are with investment as our remain such for at while and on quality remains activity confident our especially team continuous and the future focused and for is Saratoga. preserving world times higher the seeing we we value credits in opportunities And focus levels

my review market. call the concludes to back like of This I'd Chris? turn to CEO. the over our

Christian Oberbeck

Mike. you, Thank

base February on rates history. our quarterly Board dividend factors, basis, near-term Slide continue level on March and rising to evaluate considering in company both outlined The increased the was our of XXXX earnings. XX, least dividend of per quarterly including largest Directors $X.XX and latest the the on our XXXX. dividend ended is at share the XX, will a As impact spreads general of economic on quarter This for paid XX,

levels should divergence economic Saratoga's substantial provides QX the XX% $X.XX rate $X.XX or the base decline. on over-earning versus performance, interest this dividend by deteriorate direction Recognizing conditions future of of cushion or its economic opinions of rates quarter overall and

market index impacting dividends includes XX for Slide both for generated the reflects outperforming This which X% the return to the of period. negative slightly months, the last current performance total both total capital industry. the our of and X%, us appreciation volatility and returns has same XX, negative BDC Moving

on term longer performance Our next our slide. is outlined

returns five-year and quartile us of in for BDCs top the horizons. three both place time Our all

return Over three the our return past years, average XXX% exceeded XX%. of the index

XXX% total While our over average doubled Since of five more return of the the management XXX%. our has industry's XXXX, the over the Saratoga past in return than BDC took XX% been XX%. versus the index's years,

performance XX, context you see industry the the in to performance further and Slide can On certain of key placed specific metrics. our broader

return as the receiving. NII per value which and are such our on focus to share, NAV on metrics continue growing yield equity, We dividend reflects our growth, shareholders long-term

quarters. XX X.X%, and per only the growing NAV is And few beats grown NAV be term, long the our significantly by to it X.X% Year-over-year, on average. share share NAV per months XX the X.X% increased over of is continue versus is industry to and X.X% have per have industry's last accretively NAV down quarter, equity one the we return that of share XX our down this also BDCs we done the X.X%. latest

adding capital are our Moving make Saratoga including base, designed Investment drive that on quality is to investor characteristics our our that on community. help all attractive to BDC will size in initiatives to the slide call leading performance markets Slide institutions. outlined this XX, this more a discussed of the of differentiated believe We and

and floating fixed bond solid rate subsequent with accretive grade XX% historic our characteristics include per rate year maintaining in investments, the recently and highest issuances; and to new BBB+ bond debt liquidity levels of from our access demonstrated license NII rate. year or industry XX% with to raises cost-effective portfolio AUM Our end. differentiating management share XX%; long-term ownership our private and credit investment public active baby rating SPICX make and one of is and last of support and rising with of our which approval the yield, earnings to A at environment benefiting the

term; leading and the long-term long reward expansion attractive us of NAV AUM on industry the an Strong the equity high putting accompanied risk industry by return NAV top per growing of at quality share, profile. over and

quality cyclical oil industries, and portfolio our gas including conventionally credit minimal In the industry. historically to exposure contains addition, high

underwriting the tested that strategy We benefit market navigating confident strong investment well and us that and opportunities long liquidity Saratoga will historically team, environment, management structure near and in our our sheet, and standards were the serve shareholders through challenges capital future in time current experienced made and and reputation, balance uncovering will and in term. the

ongoing their would for support thank open to In now like of shareholders and to questions. again like closing, I would all call the for our

Operator

Riley. [Operator from our Rowe Instructions] first of And question Bryce is B.

open. is line Your

Bryce Rowe

Great, afternoon. thanks. Good

especially balance Let's operating levels, asked if is do. you perspective, capacity question on and to think start how that maybe this how with maybe feel I balance sheet given the to conference to where, leverage there at and see, start and and I as much from a most these calls. you SBA the target as you fact about sheet wanted wanted leverage gets a of have

Christian Oberbeck

that. you, Chris. Bryce. start I'll is Thank This with

a the we make. including loans our talked liabilities think and I and we perspective in think relative participants many, long many the nearly developed do, lending structure over investments assets, – last I everything of want that we sort we term many, and really over how years, the borrowing we industry, on our approach to in leverage our as both to to

is, And in to BDC, consistent durations things the we've the of liabilities the of of you want your do sort of looking assets, and your think duration I that. want in to accomplished your our with at conventionally one have you case

so get due that, sold mature so they how two maturity the our duration six Our assets can but generally we our element. and loans somewhat not year term, something or they or liabilities and depending that's term be is ten to coming our years balancing don't that, shorter are before type initiated schedule an important on usually like is of they financed go, and go to than

paid there's price which bullet so structure thing had both we higher maturity, speaking payments term generally will, that's other and covenants. and only interest in no we've – years which The long bonds, if principal credit for are have you not manifested is baby interest-only a not five the

going sort there's You in be debt. repay of of to that not very know even that a demand adverse circumstances any to

used generally outstanding, those when depending when the overall our – our small kind swing speaking, and years cash ten generally are to is SPIC we a as position off have in paid realized, to a and our the debt, borrowings bullet which which down so facility, And investments interest-only are line, of when relatively debentures, to amounts, draw relative sort needs. road of – we maturities also, cash on our relative are those then we've generally credit is flows what revolving and remained and has our but which that generally balance We investments. flow debentures Encina facility, that are ebbs and our

low a all and super interest asset that have our assets. do So highly interest is all our we this pay structure are debt structure compared diversified have side, we rate debt side income, is together, our to and putting on to the our asset

maybe year So especially three, that structures, periods, and three or other of two often or traditional structure. basically or difficult are four of duration two were bank have an we year comfortable year lending extraordinarily maturity our investment kind inside And if feel contrast, other assets, BDCs asset-based you have the in structures which one the more in environment. a debt with companies,

they to rates. the outstanding loans certain And loans players a loan, requirements if have after what and up were in look so circumstances the and adverse with had reset come like of elements also also to the very could prominent we've diversification equity asset-based And you some advanced advanced to right can wind and markdowns at time. get default tremendous seen some COVID. the you industry that There's that amount your for of rates change up need some they in

essentially slightly have think all that's we of we type very in don't well it Encina have at really and we exposure our that but over facility, collateralized. So

anticipate as So that a problem. being don't we

very again, years, earnings mean bulk the and four contrast levels XX to of six its but dated structure earnings relative relative solid So yield our our that. very overall that debt to and long substantial high I with history, our maturities. are We all and years, you to right is our then say portfolio, two very now. to

you grade all everything a we're the together, that getting, package we're it's I very been combination because good by that if think solid and supported investment think that's makes that situation. think rating I this So I think very recognized in of a put position I our continuing

perspective So that's on about of we a Obviously lot leverage. inside elements of, there's it. talk can our that different

other too. the a our are we of assets, investing then quality I course you very And in the of And that and feel how the are investing and able do our segment are is has credit can economy high. investments? think, What right. as piece we're leverage We in to we how are we like see, solid diversified of been

might table invest too face before elements, got sole some the or of get sorts on of plans of that in the And aspects, don't positions often their areas things influence any got business problems in we how of the sole companies we've of and modify problems and economy, growing, we've that, level we senior the we're we these secular first cyclical of in arise. our And covenants the can have we're hand secular and generally the they where lender lien that lender. all out exercise direction and get to might growing

in all structured. very well environment very of record today. we're feel proving for think comfortable are, the are troubled that is very like be I we gratified a So also we this, recognizing And the very we earnings suited how combination of with here And in face feel we that. out structure to our of

Bryce Rowe

an highlighting the kind we are for either some especially level How the some of and that dividend. That's, performance, one the relative of balancing me, helpful to think macro higher maybe earnings from asset out should about versus perspective. follow-up that interest or an of record and perspective, that there Chris. you from challenges perspective a rate unknowns dividend of or quality Maybe

Christian Oberbeck

Bryce, look while. plot been pretty think for that's mean rate they very thinks, also market is, And expecting cuts clearly with good we of later dot and I wrestle about the point dot the out forward plot talk interest every has Well, I wrong the That's question. are you at a would a right. the consistently curve that year day. something if what I this

have to the stop those had all saying the a predicting. security some been if people think of a be I has They've think rates. to saying they going are break of what are they that said Fed been of you sort think that cut montage I I telling then what and for predictions going plot to while realities, quite and go the job action, dot sort of and exactly terms might and a issues they've do in is and going

point at be they right, I might knows? know. this time. right be However, may they mean, We some don't who

dividend to year so XX% was, ago. it higher we've than And is was a a done it we've level higher our what raised substantially than

of proves the sustainable to plot if If this case, However, outlook. kind that be is back it is dot to dividend with consistent level. this rates a that's go believe that negative we

that Not where than we we're closer market to is, try just economists probably don't Fed but the is we We know just is and that. think reality not that the forecast the where to anything.

be a or shape to wrong. right to that dividend our we're where in should to have structured in prove We going out. think reasonable position we've so who's And be we don't predict

we for all that's it's when with there constantly and question have a more, fixed world mean continues, structured well of of side is badly I of Either is, There's that inflation we most the if side. enormous, think for And way, kind quality lot into go the to people PhDs If of I of us is of should and liability both stuff place, course we're out other so things very it's the but tons credits can out it all recession. predicted that. forecast coming. side terms and the the in structured But are. not on time mean, occur? turns saying we rates get structured. I and charge are determine. the a asset we that of I that that. we're can very it our up in and bad recession We're economy, through keep go pushing they coming, The think our people structured keep coverage

the we feel overall dividend again, – we're well-structured. like is So

right. position of good terms to very a at spillover, In spillover. there's we're And technically relative

maybe not we how make payment at So if a to dividend to, least XX tax have for or want out depending longer. to, if we special have dividend can payment don't over-earn don't and we special a things months shake and our

deal to and economy the the for direction dividend we and the that is, chance our the react quality interest and earn to over also So understand of have ability the to rates adjust direction high look and while, are, of we while and flow have what a watch a tremendous experiencing. do try we're

and cautious ever the term performance and hopefully right So feel of optimistic not about very the near we but that the best okay, we've again, are enjoying we in too don't had long-term. being some changing now, see we in

Bryce Rowe

today. color. Thanks time for the That's great

Christian Oberbeck

you. Thank

Henri Steenkamp

Bryce. Thanks

Operator

One question. question our next from our next And is Mickey with moment Schleien Ladenburg. for

Your line open. is

Mickey Schleien

afternoon, Yes. Good everyone.

and the very of prepared those were a commercial but amongst been thorough, seen, have Your banks retrenching a I discussion And banks. this we've have larger we now on but inquiries more remarks disintermediation regional new I'm curious seen through failures as margin, following obviously couple the have There's only so regional lot a large increased banks been trend long-term whether of of focusing we've of banks, recent you're questions. that lenders, seeing at the retrench.

Christian Oberbeck

I'll start. And yes, we have.

they XX growing in from credit I quality the deeper either capital us XX banks this lot they we're that company's to much they some a into capital. – deals more kind think, And the companies. more won and months even that's drawing high and of going historically last banks getting in had have line by mean are a we've and for from I than much of reversed, for that the a advancing used need example, have calls than banks is terms of harder growing, to

companies. good bank So credit sort opportunity the moving arising against, of we criteria are their tremendous a very up back from seeing tightening in

Valley in back. actually Silicon picked Bank. got instance us had have one We up away won from it deals and business we from They

is that? this opportunity Mike, yes, for some on providing so more comment would on like you us. to And maybe

Michael Grisius

expound a on Mickey. me little Yeah, bit let

about prepared think we terms the going and market where is think the I about of – talked that the is in general, the go. economy everybody's the is that's its all as market to So looking at if macro you'd market about you cautious in characterize remarks, for reasons the in concern way the

you out particularly would being where and competitors saw So COVID. of you awfully see aggressive used coming this see we to

competitively, you of over a hand will, and doing away money just if whole not lot putting kind money people super diligence deals out, saw pricing You of really giving fist.

hold is What positions, considerably. are bar pretty we've in People underwriting, and their caution. their seen expanding pricing in more the this raising their they're much market

the of six are months sure last for kind going Yes, seeking that And that that experience been for. has can capital the so. positive we've make having receiving folks question – that to they been people or say the So had certainly that out inquiries. are of more they more to let's capital are your to secure looking

that, general second that the been which banks that accelerated deal. would thing just be retreat further then of referenced, trend by in Chris the what would the And has be

that of I companies. really not instance directly for that mentioned of closed activity, we're we've say related two And quarter portfolio M&A to since solid clip. are healthy would really five both but end I groups to businesses the new So that those a their balance going at were their into existing entered comfortable sheet, so those ownership of be feeling weren't enough we deals. growing supportive But banks

more market So it's in receiving factors, a inquiries confluence of we for but are this yes, sure.

Mickey Schleien

I appreciate that. that one Mike. to And just follow-on

also mentioned this spreads. Given years, head been considering what on recently. They've my in you has of all debt you've private as the the and expanded I'm yields yields, how few call, sort But of trajectory just capital scratching as said, extremely much over raised are attractive. last equity but to

also your dynamics, lower what's wider deals? look that spreads at we've about two and willingness on the those seeing maintain gut been if So telling the multiples you you to market's these

Michael Grisius

now We is more where experience probably make and tell is can't think out are prediction. certainly one, I your spreads discipline. even Bank lot is little that prediction that a those But a make a is the I certainly There's there. seen spreads but saw to and Silicon question can really you a spreads good the a couple recognizing with can't could, going hasn't wider that I terms what of we're I persist. what wish bit I go changed. last Yeah, quarters. seeing of capital there considerably Valley over widening right pretty widen I in We've of

I underwriting. we that's anything allowed What's the last of pricing them or to months think at our we don't our risk couple way the look the so right at always happened accelerate think sure this is way. to in in us that our looking of we're adjusted deployment returns. I changed our that market's deals, And make we're come kind getting

ever, as people cautious are that other starting well. way being as be finally to are as We but

Mickey Schleien

for today. questions for that, thank Thanks That's taking That's And me. Mike. it helpful. my from you really

Christian Oberbeck

Mickey. Thanks

Operator

moment our question. One for next

next Casey Trading. Our is Research with Alexander from & question Compass Point

line Your open. is

Casey Alexander

simple that? of Wax, It's is the see. Hi! a than curious. or here. is, company Is you different kind dividend normally a of A how what success of just a of an sort a we on little pretty questions payment that just term couple Artemis on of would One or characterize sale end fee like

Michael Grisius

good think because think it we a I No, of little And it's a it sale indeed be called equity, I can was. it question. confusing a which

a independent sponsor we capital, had business us. story change of that for individuals, So It's real couple not think The Kind of bright indicative capital a kind over more wonderful of do, them to of transaction. was time of owners that transaction. a well we well, and control enterprise a I of their ago exceedingly were had type we what years of who actually business very grow is group value. done backed lent

of space part equity. in investor the business and of they really put very money on a minority at dividend that, experienced in enterprise control, or Rather than our as similar spaces initial healthy in that's is common value. experience and received a And group a entirely change equity brought a a selling we sponsor who that

preferred two a We return nice those also our resulted of received payoff equity in quarter. and in that

equity the thankfully new the co-invested sponsor as in also We alongside well.

hopefully of to – valuation, the minority common that growth new sponsorship. So to support own then the with continuing we're their the are to that at will in benefit our get shareholders value and to And of a the the to enterprise business be continuing participating original equity sponsors growth. excited future lender continue

Casey Alexander

listed schedule What I'm of investments? it is in up. not the picking that

Christian Oberbeck

two have one investments. be off call. on of And be preferred should was believe, them, there a well. a that should has then other maybe as There there paid a preferred that more loan piece then have There should one as we there's senior of a you well could two, of common be They off on that's schedule label loan. should preferred may view equity and but some the senior be I we them We and features. kind our the help investments

Henri Steenkamp

schedule there's types Talk] of the Then of two eyes investments on [Cross

Casey Alexander

presentation that's I start same on time. by a had so report I schedule goes else's got investments, I good got long just because of companies it. at looking many was saying what it. Look, wanted we've the time. forward to on somebody happened. evening, the I

Christian Oberbeck

you time Busy for guys.

Casey Alexander

other one $XX and XXXX issued curiosity. and here, out Yeah, the question million notes and you million this and XXXX. release three just May XX hasn't says of of is it In that quarters yet. press XX, XXXX on happened eight XX, May March $XX

a May that is sale future on So active that becomes XX?

Christian Oberbeck

and to you. typo. baby a March Thank May private was tranche two supposed might bond. It it's That yesterday. X, No, Yeah. was yesterday. It which be was be a XX

Casey Alexander

thought sale it. a seen do might debt, of some forward so have BDCs I be we Now, that

you. thank Okay,

Operator

our for moment next One question.

Our with next Dodd question comes James. from Robert Raymond

open. is Your line

Robert Dodd

to questions Hi on to the the answers guys, going I'm rehashing At your congratulations risk that, anyway. quarter. Bryce's of and and

the the your relative it the leverage point, I of I maturity question amount unsecured, the leverage, the base, if the my structure is excellent. absolute The is in just structure mean much can, So there equity amount your of on mind, too to itself question, of right? ladder, to

and one-seven the be On the a close the deployment to now. end regulatory a and leverage a to have covenant private XX on your basis in, baby all to got unsecureds right and leverage got basis, bonds be notes, post-quarter leverage leverage you've regulatory after You've

Is because have one your the until XXXX. not of the seven XXXX. minimum to really maturity a that there's you There's Encina, basis on down next regulatory until maturities not covenants, with a You on borrowing a two lot for comfortable for room first debt level a anything. the pay don't is is years, so

Henri Steenkamp

but nature a one it that's our believe of the I mean, schedule be the we we would than continue I and have, NAV type that we to the phrased but growth off maturity the NAV thing, number, think, the have with the and we way with structure one-seven context of feel of maturities, we and one-seven and comfortable. of we debt coming context something it stability had think was one-seven and have the that all earnings we portfolio asset-based is a I one-seven of what that is before absolute. if two-year as different the loans is in

think else's isn't I so And someone one-seven. our one-seven

Robert Dodd

I seems and on market starting understand periods off anyway, other just be Talk] this not to your another But COVID. point. addressed moving the But at that can as I'm if obviously, quite you earnings… The there well. volatility, happen, I'm to were one-seven of high. part [Cross that forecasting

Henri Steenkamp

couple technical just would the Robert, this a private point, of that is already. I just callable from bonds add Henri. would a there that I are are actually

technical none a to a So of but point your publics, the initial are there privates, couple of comment. the from just

Michael Grisius

just again. on I doing let to when me a sheet, caller's Chris interesting elaborated this questions, put we've different earlier it to well a very time. but an emphasize thing balance I it think an It's just well emphasize that long been one we in way. And for construct awfully mean

that's we had balance in, a we're and that fair or then they models structure businesses strong leverage and hooks that of be in would defaults, leverage things really even low various businesses will, with would a have consisted a good think mark-to-markets, that, make in that us not a a thing, junior If lot to really I that where sheet you go that of tell about combine can a balance sheet really were really weren't lending industries or sense. in we of that that you amount capital cyclical we investing if the as right? business We that the wouldn't covenant industries way constructed awry,

swing that think cyclical, has leverage asset end portfolio are durable so have an in the recession first we very And less resistant, free context portfolio a of businesses assets, debt very borrower a we about that industry in that whatsoever, small and with line. is our quite we friendly, covenants combine as flow. which lot with cash the a and structure functions facility, that then other And of generally Encina or markets recurring revenue think lien some investment really XX% really no is that than

dismissive very It at I attention. good But paying doesn't don't of look it's at want that careful a something it's we mean the that to it, it to. when we're context. not but be in leverage, we question, attend that look we

Robert Dodd

spillover, one so it's a for goes the under $XX you kind The you Chris. if back in just next Understood. I Thank amount. $X.XX read I partly to I mean, might to million XX-K, also mean I that. of and have

would later. your year You could from situation in That's ballpark, hand or could call year yet, $X.XX maybe $X the estimate a have year. in spillovers, your it of forces put you be in now, in over twos which kind mid where this then a a but – you somewhere $X.XX current kind of you my quarter that easily not by dividend a that of

planning then It's earnings next to run such to pay that on strong to months, like is forced a – risk leverage. goes is are speak? but benefit but your for have you to really the that your your so from level point spillover waiting, you the a it Is your don't XX the power you high supplemental that hand

Christian Oberbeck

focused that very a very – Well, we that's I are good on. that's think something very,

at forward rate as the look dot interest as you of the expectations think as said, soon we I coming down July. plot

the people and ongoing Some are then be, And this have says, that we're experiencing. going what to fed what forecasting July, you you rates then are the right. have earnings

really spread in we've structuring a business. predicted And and outcomes. we're the of think very very, I prediction over so of ourselves accordingly not and there's again investing very companies the business said as We're in of in huge, in And large kinds over very, solid environments. all

more, is, by decision now. right dividend to and penny, That's And it we're think we answer a hard over-earning not now. prepared so, our raised the why by short substantially not I right we're wildly make a

be this considering as all manage that. I we Obviously, to we're day, actively into mean this considering all every not at settle are this but maybe to next going we phase, times

they hard, just if XXXX. to actual things spillover versus believe the be us. months, for XX months a we is of And to and in going way one November adjust happen next to think happened going the date going to XX or are we're what's of take lot I another, reconciliation the you there's positive and last that's

to as have we it go. we'll So adjust

minute, and as and levels, where our we our over our one dividend and increasing quality watch be and very you bank our doing are way carefully business going to the right. sort not to other. liquidity structure, We're the that have earning do But high that very into this or to of earnings and be react are, NAV we to of ready and into we're we're

Henri Steenkamp

Yeah. is think Robert, what said are you just the, next year important considering the November we and as really is right. And in thing, of now, which It’s to-date, making XX decision make Chris just, a the a is months, I those not said you've fourth day, right. you decisions single don’t to case every it period. that got through make got to But

Robert Dodd

Understood. Thank you.

Christian Oberbeck

necessarily at point and of know one the you correct but as this if cover it and players know our as well don't And not We well it. would I a remark me you that, very, I better. might, industry would industry you and correct I'm can make make very in fellow also quite bit

managing relative and the understanding about our circumstances And to a amount been much we've of industry. have less more our utilizing as with treated sort careful that's and spillover, fairly aggressive $XX number further is think in, I a… BDC at the a spillover mentioned the because to time in of industry they've particularly spillover relative of out spillover we're most the their curve you lot been spillover handle we've actually flexibility Talk] [Cross BDC and of the small million in spillover, most just

Robert Dodd

Yeah.

sensitivity strong your your so or it and else. just point, It's for The power building of pronounced XX% rest it the is That like, mean is doesn’t quarter you is great on. space yours considered, the mean to higher the very power have for a earnings would situation earnings rate were relative it's carry and earnings you so situation be. this a XX% Sorry, not not and that investors quickly. is that to dividend. have, just Yeah. for quickly to so but your your strong I is than only the reason is your I normal builds to everybody

Christian Oberbeck

you And we're know, point happy out. this wrestling you be rightly as with Yeah. to problem

Robert Dodd

Thank you. Yeah.

Operator

And last One Erik Zwick question question. from our Group. Hovde moment for next our comes with

open. Your is line

Erik Zwick

afternoon. Good

me. two for Just questions

fair – first the your one cost value equity the up while looking just The was portfolio XX% was at down. market the quarter-over-quarter, about of

drivers in or the the devaluation to factors what led marks curious just quarter? So

Christian Oberbeck

performance companies. portfolio underlying of just Primarily the

to but One of at our performance. really of portfolio as performance of the we're in mentioned we're The we're prepared of I looking do, delighted our up terms portfolio. We looking that carefully see, at majority its is our things especially remarks, portfolio. in our the financial year-over-year always vast

based the of the portfolio. underlying in were just And so valuation fundamental of the majority on performance quarter this write-ups

Erik Zwick

for several factor pipeline of M&A the it little you a big in one last they'd the to a other the addressed remains and quarter portfolio opportunities. most bit little about that me, the then And Thanks. market. guess quarters. kind higher the curious I actual in times prior during guess call, to I And a that potential and sales and maybe many I'm and the were in stands repayments than me just been out growth recent terms slower robust of bit

have especially bit it's maybe in on know got of more tough I maturities, to sales, little visibility, terms but maybe it's one, visibility So a there.

either of So for your what sales with that potentially repayment just and how new perspective, the offset curious expecting from originations. or opportunity of that dovetails you're kind terms in

Michael Grisius

of And average our just over we it apply a the a portfolio on our portfolio off a good we think that, maturity of our we pay in is about as time, portfolio. repayments. at third Rule predict normal can't a that's about that thumb question. of often Yeah, clip course than should should market, faster on

a really that Now wider company's we're might than get real time a there's well the and normal doing capital not things that priced somebody usually markets else so and drive repayments. One, we're two offer. necessarily is hot and in

environment. sheet. recapitalized get of much of balance And seeing a not out this you so in We're that

drives activity. typically other that M&A is thing repayments The

think company's just I not best now are at the real most So is while sell the The our of to because ownership sell themselves ownership looking done group to well, are being performing groups right general. portfolio decides valuations well. down the in as time and very

those predict the are environment combination say if normal they of as to as would, a factors I so but a not probably in going hard might that And two you see payoff to predict, very had would see will, fast you to if in respect. pace

a we've building time of invest, lot over relationships of Now, the spent terms in in to relationships, investing years. opportunities

always are a of us. source those for And deals so healthy

being as of where market invest lenders our to In addition development have lot good expect well. combination we in team to flow to continue of position plus remain that, cautious, selective and to we've the those I we'll going put a in that a opportunities business would we're of But seeing us see as has are a things invested been. And environment where we're plenty ever lots as capital. deal more

Erik Zwick

my Great. today. taking for Thank you questions

Christian Oberbeck

Great. Thanks Erik.

Operator

no call remarks. this I to to time. showing I'm now would closing turn Chris like for And you. Thank over the questions at further CEO, the back Oberbeck

Christian Oberbeck

next ongoing we with you. look and and to appreciate Saratoga, their this all for on speaking call all shareholders support really of again, Well, we you again forward our Thank for quarter.

Operator

this concludes And conference participating. today's Thank call. for you

now disconnect. may You

Saratoga Investment (SAR) 3 May 232023 Q4 Earnings call transcript