Logan Ridge Finance Corporation Reports $5.4 Million Net Decrease in Assets for Q1 2025

Logan Ridge Finance Corporation reported a net decrease in net assets resulting from operations of $5.4 million for the three months ended March 31, 2025, compared to a net increase of $1.9 million for the same period in 2024. This translates to a basic and diluted net decrease in net assets per share of $(2.02), down from $0.69 in the prior year. The company's total investment income for the quarter was $4.6 million, a decline of 7.4% from $5.0 million in the previous year, primarily due to a decrease in interest income, which fell from $4.6 million to $3.9 million. The company attributed this decline to lower base rates and a smaller interest-earning portfolio.

Total expenses for the quarter decreased to $3.7 million from $4.1 million, driven by a reduction in interest and financing expenses, which dropped from $2.0 million to $1.8 million. This reduction was largely due to a lower outstanding debt balance on the 2032 Convertible Notes and a decrease in financing costs associated with the KeyBank Credit Facility. The company also reported net realized gains on investments of $2.6 million, up from $0.3 million in the prior year, but faced a significant net change in unrealized depreciation on investments of $(8.8) million, contrasting with a gain of $0.7 million in the previous year.

As of March 31, 2025, Logan Ridge's total assets were valued at $180.7 million, down from $192.7 million at the end of 2024. The company’s investments at fair value totaled $169.6 million, a decrease from $172.3 million at the end of the previous year. The company reported a net asset value per share of $29.66, down from $32.04 at the end of 2024. The decline in net assets was attributed to unrealized losses on investments, which were impacted by market conditions and the performance of portfolio companies.

Logan Ridge continues to focus on its investment strategy, which includes providing capital to lower and traditional middle-market companies primarily through first lien loans. The company made approximately $15.1 million in new investments during the quarter, while repayments and sales totaled approximately $12.4 million, resulting in a net deployment of $2.7 million. The company also reported that 9.3% of its debt investment portfolio was on non-accrual status, with an aggregate amortized cost of $17.2 million and a fair value of $3.7 million.

Looking ahead, Logan Ridge is evaluating strategic opportunities, including a potential merger with Portman Ridge Finance Corporation, which is subject to stockholder approval and other closing conditions. The company aims to continue generating income and capital appreciation through its investment activities while managing its portfolio in response to market conditions.