Portman Ridge Finance Corporation Reports Q1 2025 Financial Results with Decline in Net Investment Income

Portman Ridge Finance Corporation reported its financial results for the first quarter of 2025, revealing a net investment income of approximately $4.3 million, or $0.47 per share, compared to $6.2 million, or $0.67 per share, in the same period last year. Total investment income for the quarter was approximately $12.1 million, a decline from $16.5 million in the prior year, primarily due to a decrease in interest income from non-controlled/non-affiliated investments, which fell to $7.3 million from $12.6 million. The company’s net assets decreased to $173.5 million as of March 31, 2025, down from $178.5 million at the end of 2024, resulting in a net asset value per share of $18.85, down from $19.41.

The company experienced a significant change in its investment portfolio, with total investments at fair value increasing slightly to $406.4 million from $405.0 million at the end of 2024. The portfolio consisted of 93 companies, with a weighted average annualized yield of approximately 11.0%. However, the company reported a net change in unrealized depreciation on investments of approximately $(3.9) million for the quarter, compared to a gain of $0.1 million in the same period last year. This depreciation was attributed to various factors, including market conditions and the performance of specific investments.

In terms of operational developments, Portman Ridge has continued to focus on its strategy of investing in secured term loans and mezzanine debt primarily in privately-held middle-market companies. The company has also been actively managing its debt, with approximately $255.4 million in outstanding borrowings as of March 31, 2025, and an asset coverage ratio of 168%, compliant with the minimum requirement of 150% for business development companies. The company’s management fees for the quarter were approximately $1.5 million, down from $1.7 million in the previous year, reflecting a decrease in average debt outstanding and lower costs of capital.

Looking ahead, Portman Ridge is evaluating strategic opportunities, including a potential merger with Logan Ridge Finance Corporation, which is expected to close in the second quarter of 2025, subject to stockholder approval. The company has also declared a regular quarterly distribution of $0.47 per share, payable on May 29, 2025. Management remains focused on maintaining liquidity and capital resources to support its investment strategy while navigating market conditions and potential risks associated with its portfolio.