Q2 2024 MidCap Financial Investment Corp Earnings Call Transcript

Aug 08, 2024 / 12:30PM GMT

Release Date Price: $13.34 (+2.46%)

Transcript 8-K10-Q

Key Points

Positve

Successful completion of mergers with Apollo Senior Floating Rate Fund Inc. and Apollo Tactical Income Fund Inc., enhancing MFIC's portfolio diversification and operational synergies.
Net investment income per share for the June quarter was $0.45, corresponding to an annualized return on equity of 11.8%.
MFIC's net assets increased by approximately 44% due to the mergers, providing significant investment capacity.
Strong recurring interest income from a predominantly floating rate portfolio, with a weighted average yield at cost of 12%.
MidCap Financial's extensive origination track record and large data set provide MFIC with significant deal flow and attractive investment opportunities.

Negative

Net asset value per share decreased by $0.04 from the end of March to $15.38 at the end of June.
The weighted average spread on the corporate lending portfolio decreased by 20 basis points compared to the end of March.
Investments on non-accrual were 1.8% of the total portfolio at fair value, indicating some credit quality concerns.
The blended yield across the total investment in Merx is less than 4%, which is lower than the overall portfolio yield.
The process of selling non-directly originated assets acquired from the mergers is ongoing and may take several quarters to complete.

Operator

Good morning, and welcome to the earnings conference call for the period ended June 30, 2024, for MidCap Financial Investment Corporation. (Operator Instructions)

I will now turn the call over to Elizabeth Besen, Investor Relations Manager for MidCap Financial Investment Corporation.

Elizabeth Besen

MidCap Financial Investment Corp - Investor Relations

Thank you, operator, and thank you everyone for joining us today. Speaking on today's call are Tanner Powell, Chief Executive Officer; Ted McNulty, President; and Greg Hunt, Chief Financial Officer. Howard Widra, Executive Chairman, as well as additional members of the management team are on the call and available for the Q&A portion of today's call.

I'd like to advise everyone that today's call and webcast are being recorded. Please note that they are the property of MidCap Financial Investment Corporation and that any unauthorized broadcast in any form is strictly prohibited. Information about the audio replay of this call is available on our press release. I'd also like to call your

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