11h ago
Stellus Capital Investment Corporation Reports Results for its Second Fiscal Quarter Ended June 30, 2026
Stellus Capital Investment Corporation Reports Results for its Second Fiscal Quarter Ended June 30, 2026
HOUSTON, Aug. 10, 2026 — Stellus Capital Investment Corporation (NYSE: SCM) ("Stellus", "we", or the "Company") today announced financial results for its fiscal quarter ended June 30, 2026.
Robert T. Ladd, Chief Executive Officer of Stellus, stated, "I am pleased to report solid operating results for the quarter ended June 30, 2026, in which we earned both U.S. GAAP net investment income and core net investment income of $0.26 per share and net realized income of $0.01 per share. During the quarter, we funded $18 million of investments and received $49 million of repayments, resulting in a total portfolio of $968 million at fair value. I'm also pleased to report that since we announced our Share Repurchase Program in March, we have repurchased 467,317 shares at an average price of $8.50 per share."
FINANCIAL HIGHLIGHTS
($ in millions, except data relating to per share amounts and shares outstanding)
Three Months Ended
Six Months Ended
June 30, 2026
June 30, 2025
June 30, 2026
June 30, 2025
Amount
Per Share
Amount
Per Share
Amount
Per Share
Amount
Per Share
Net investment income
$7.53
$0.26
$9.56
$0.34
$15.03
$0.52
$19.35
$0.69
Core net investment income(1)
7.56
0.26
9.99
0.35
15.42
0.53
20.28
0.72
Net realized loss on investments
(7.24)
(0.25)
(0.86)
(0.03)
(6.49)
(0.22)
(6.83)
(0.24)
Net realized loss on foreign currency translation
—
—
(0.02)
—
—
—
(0.05)
—
Total realized income(2)
$0.29
$0.01
$8.68
$0.31
$8.54
$0.30
$12.47
$0.45
Distributions
(9.80)
(0.34)
(11.36)
(0.40)
(19.64)
(0.68)
(22.45)
(0.80)
Net unrealized change in appreciation on investments
15.90
0.55
1.44
0.05
9.35
0.32
2.63
0.09
Net unrealized change in appreciation (depreciation) on foreign currency translation
0.02
—
0.03
—
(0.03)
—
0.04
—
Net increase in net assets resulting from operations
$16.21
$0.56
$10.15
$0.36
$17.86
$0.62
$15.14
$0.54
Weighted average shares outstanding
28,869,028
28,412,849
28,907,925
28,009,969
(1)
Core net investment income, as presented, excludes the impact of capital gains incentive fees (reversal) and income taxes, the majority of which are excise taxes. The Company believes presenting core net investment income and the related per share amount is a useful supplemental disclosure for analyzing its financial performance. However, core net investment income is a non-U.S. GAAP measure and should not be considered as a replacement for net investment income and other earnings measures presented in accordance with U.S. GAAP. A reconciliation of net investment income in accordance with U.S. GAAP to core net investment income is presented in the table below the financial statements.
(2)
Total realized income is the sum of net investment income, net realized gains (losses) on investments, net realized gains (losses) on foreign currency, and losses on debt extinguishment, all U.S. GAAP measures.
PORTFOLIO ACTIVITY
($ in millions, except data relating to per share amounts, shares outstanding, and number of portfolio companies)
As of
As of
June 30, 2026
December 31, 2025
Investments at fair value
$968.2
$1,007.6
Total assets
$982.1
$1,041.3
Net assets
$367.0
$371.2
Shares outstanding
28,672,911
28,947,254
Net asset value per share
$12.80
$12.82
Three Months Ended
Six Months Ended
June 30, 2026
June 30, 2025
June 30, 2026
June 30, 2025
New investments
$18.0
$22.8
$45.7
$78.2
Repayments of investments
(49.2)
(31.6)
(90.9)
(46.6)
Net activity
($31.2)
($8.8)
($45.2)
$31.6
As of
As of
June 30, 2026
December 31, 2025
Number of portfolio company investments
116
115
Number of debt investments
98
100
Weighted average yield of debt and other income producing investments (3)
Cash
7.9 %
8.5 %
Payment-in-kind ("PIK")
0.8 %
0.5 %
Fee amortization
0.3 %
0.3 %
Total
9.0 %
9.3 %
Weighted average yield of total investments(4)
Cash
7.4 %
7.9 %
PIK
0.7 %
0.5 %
Fee amortization
0.3 %
0.3 %
Total
8.4 %
8.7 %
(3)
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 in the Company's common stock would realize in a return over the same period because the dollar-weighted average annualized yield does not reflect the Company's expenses or any sales load that may be paid by investors.
(4)
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 equity positions and debt investments on non-accrual status.
Results of Operations
Investment income for the three months ended June 30, 2026 and 2025 totaled $22.3 million and $25.7 million, respectively, most of which was interest income from portfolio investments.
Gross operating expenses for the three months ended June 30, 2026 and 2025 totaled $14.8 million and $17.1 million, respectively. For the same respective periods, base management fees totaled $4.4 million and $4.3 million, income incentive fees totaled $0.2 million and $2.2 million, fees and expenses related to our borrowings totaled $8.5 million and $8.7 million (including interest and amortization of deferred financing costs), administrative expenses totaled $0.6 million and $0.5 million, income tax totaled $0.0 million and $0.4 million and other expenses totaled $1.1 million and $1.0 million. The Company waived $0.0 million and $1.0 million of income incentive fees due to the total return limitation pursuant to the provisions of the Investment Advisory Agreement between the Company and the Advisor (as defined below) for the three months ended June 30, 2026 and 2025, respectively, for net operating expenses of $14.8 million and $16.1 million, respectively.
Net investment income was $7.5 million and $9.6 million, or $0.26 and $0.34 per common share based on 28,869,028 and 28,412,849 weighted average common shares outstanding for the three months ended June 30, 2026 and 2025, respectively. Core net investment income, which is a non-U.S. GAAP measure that excludes capital gains incentive fees (reversals) and income tax expense accruals, for the three months ended June 30, 2026 and 2025 was $7.6 million and $10.0 million, or $0.26 and $0.35 per share, respectively.
For the three months ended June 30, 2026 and 2025, the Company's investment portfolio had a net change in unrealized appreciation of $15.9 million and $1.4 million, respectively, and the Company had net realized losses of ($7.2) million and ($0.9) million, respectively.
Net increase in net assets resulting from operations totaled $16.2 million and $10.1 million, or $0.56 and $0.36 per common share, based on 28,869,028 and 28,412,849 weighted average common shares outstanding for the three months ended June 30, 2026 and 2025, respectively.
Liquidity and Capital Resources
As of June 30, 2026, the Company's amended senior secured revolving credit agreement with certain bank lenders and Zions Bancorporation, N.A. dba Amegy Bank, as administrative agent (as amended from time to time, the "Credit Facility") provided for borrowings in an aggregate amount of up to $335.0 million on a committed basis. As of both June 30, 2026 and December 31, 2025, the Credit Facility had an accordion feature which allowed for potential future expansion of the facility size up to $365.0 million.
As of June 30, 2026 and December 31, 2025, the Company had $222.2 million and $236.6 million in outstanding borrowings under the Credit Facility, respectively.
On March 3, 2026, the Company announced that its Board authorized a program for the purpose of repurchasing up to $20,0 million of its shares of common stock (the "Repurchase Program"). Under the Repurchase Program, the Company may, but is not obligated to, repurchase its outstanding common stock in the open market from time to time, provided that the Company complies with the requirements under its Code of Ethics and the guidelines specified in Rule 10b-18 of the Securities Exchange Act of 1934, as amended, including certain price, market volume and timing constraints. Unless amended or extended by the Board, the Repurchase Program will expire on the earlier of March 2, 2027 or when $20.0 million of the Company's outstanding shares of common stock have been repurchased.
During the three months ended June 30, 2026, the Company repurchased 274,343 shares of its common stock under the Repurchase Program for an aggregate purchase price of $2,447,682, including commissions, at a weighted average net repurchase price of $8.92 per share.
Distributions
For the three months ended June 30, 2026 and 2025, the Company declared aggregate distributions of $0.34 per share and $0.40 per share, respectively ($9.8 million and $11.4 million in the aggregate, respectively). Tax characteristics of all distributions are reported to stockholders on Form 1099-DIV. Tax characteristics of all distributions will be reported to stockholders on Form 1099-DIV after the end of the calendar year. None of these dividends are expected to include a return of capital.
Recent Portfolio Activity
The Company invested in the following portfolio companies during the three months ended June 30, 2026:
Activity Type
Date
Company Name
Company Description
Investment Amount
Instrument Type
Add-On Investment
April 1, 2026
EH Real Estate Services, LLC*
Offers residential property brokerage, title & settlement, and property and casualty insurance brokerage services to home buyers and sellers
$
190,093
Senior Secured – First Lien
New Investment
April 3, 2026
VeloSource Purchaser, LLC
Locum tenens staffing agency
$
200,000
Senior Secured – First Lien
$
100,000
Delayed Draw Term Loan Commitment
$
100,000
Revolver Commitment
$
18,605
Equity
Add-On Investment
April 13, 2026
Venbrook Buyer, LLC*
An independent insurance services broker
$
1,256,415
Senior Secured – First Lien
New Investment
April 13, 2026
Solomon AcquisitionCo, LLC
An innovative process automation and digital systems integrator
$
4,196,557
Senior Secured – First Lien
$
100,000
Revolver Commitment
$
186,807
Equity
New Investment
April 27, 2026
OW RSG LLC
Manufacturer of walk-in coolers, freezers, and refrigeration systems
$
4,000,000
Senior Secured – First Lien
$
100,000
Delayed Draw Term Loan Commitment
$
100,000
Revolver Commitment
$
324,074
Equity
Add-On Investment
April 28, 2026
Venbrook Buyer, LLC*
An independent insurance services broker
$
502,566
Senior Secured – First Lien
Add-On Investment
April 28, 2026
Advanced Barrier Extrusions, LLC*
Manufacturer of flexible packaging
$
330,250
Senior Secured – First Lien
Add-On Investment
June 1, 2026
Venbrook Buyer, LLC*
An independent insurance services broker
$
736,152
Senior Secured – First Lien
Add-On Investment
June 26, 2026
Venbrook Buyer, LLC*
An independent insurance services broker
$
352,052
Senior Secured – First Lien
Add-On Investment
June 29, 2026
Monarch Behavioral Therapy, LLC*
Provider of center-based applied behavioral analysis therapy services
$
29,822
Convertible Promissory Note
Add-On Investment
June 30, 2026
Valor Buyco LLC*
Provider of dispatched road services
$
120,000
Delayed Draw Term Loan Commitment
*Existing portfolio company
The Company realized investments in the following portfolio companies during the three months ended June 30, 2026:
Activity Type
Date
Company Name
Company Description
Proceeds Received
Realized Gain
Instrument Type
Full Repayment
April 17, 2026
Sales Benchmark Index, LLC
Provider of revenue growth management consulting services for private equity-owned and large enterprise clients
$
11,968,656
$
—
Senior Secured – First Lien
$
443,820
$
—
Revolver Commitment
Full Realization
$
486,925
$
(178,805)
Equity
Full Repayment
April 24, 2026
Equine Network, LLC
Provider of equine competitions, content, products, and services
$
9,043,164
$
—
Senior Secured – First Lien
$
97,900
$
—
Delayed Draw Term Loan Commitment
$
166,667
$
—
Revolver Commitment
Full Repayment
April 30, 2026
Cerebro Buyer, LLC
Manufacturer of single-use electrodes for medical procedures
$
4,526,683
$
—
Senior Secured – First Lien
$
376,902
$
—
Delayed Draw Term Loan Commitment
Full Repayment
May 21, 2026
Premiere Digital Services, Inc.
Provider of digital media services to the entertainment industry.
$
12,038,926
$
—
Senior Secured – First Lien
Full Repayment
June 30, 2026
Tilley Company
Distributor of specialty chemicals, oils, and lubricants into the food & beverage, lubricants, flavor and fragrances, personal care, and other chemicals end-markets
$
44,110
$
—
Senior Secured – First Lien
$
13,043
$
—
Revolver Commitment
Events Subsequent to June 30, 2026
The Company's management has evaluated subsequent events through August 10, 2026. There have been no subsequent events that require recognition or disclosure except for the following described below.
Investment Portfolio
The Company invested in the following portfolio companies subsequent to June 30, 2026:
Activity Type
Date
Company Name
Company Description
Investment Amount
Instrument Type
Add-On Investment
July 2, 2026
Blade Landscape Investments, LLC*
Regional provider of commercial landscaping services
$
5,250
Equity
New Investment
July 16, 2026
Emergent Software
Microsoft-centric data, AI, and cloud IT services partner
$
3,197,377
Senior Secured – First Lien
$
2,664,481
Delayed Draw Term Loan Commitment
$
500,000
Revolver Commitment
$
306,732
Equity
New Investment
August 5, 2026
LJ Welding Automation Ltd.
Manufacturer of material handling and welding automation systems
$
7,693,688
Senior Secured – First Lien
$
500,000
Revolver Commitment
$
303,470
Equity
*Existing portfolio company
The Company realized investments in the following portfolio companies subsequent to June 30, 2026:
Activity Type
Date
Company Name
Company Description
Proceeds Received
Instrument Type
Full Repayment
July 1, 2026
General LED OPCO, LLC
Provider of LED lighting systems and modules
$
4,500,000
Senior Secured – Second Lien
Full Repayment
July 27, 2026
MacKenzie-Childs Acquisition, Inc.
Lifestyle home décor brand
$
86,331
Senior Secured – First Lien
Full Repayment
July 30, 2026
U.S. Expediters, LLC
Reseller of CPAP machines and accessories
$
14,236,513
Senior Secured – First Lien
Credit Facility
The outstanding balance under the Credit Facility as of August 10, 2026 was $211.7 million.
SBA Licensing
On July 14, 2026, we received a license from the SBA for the SBIC III subsidiary, which allows us to contribute $125.0 million of equity and draw up to $250.0 million of SBA-guaranteed debentures, subject to the increased family of funds limit of $475.0 million across all of our SBIC subsidiaries and applicable SBA regulations and policies.
Distributions Declared
On July 16, 2026, the Board of Directors of the Company declared a regular monthly dividend for each of July 2026, August 2026, and September 2026 as follows:
Record
Payment
Amount per
Declared
Date
Date
Share
July 16, 2026
July 31, 2026
August 14, 2026
$
0.0833
July 16, 2026
August 31, 2026
September 15, 2026
$
0.0833
July 16, 2026
September 30, 2026
October 15, 2026
$
0.0833
Share Repurchase Program
Since June 30, 2026, we repurchased 192,974 shares of our common stock under the Repurchase Program at a weighted-average purchase price of $7.95 per share.
Conference Call Information
Stellus Capital Investment Corporation will host a conference call to discuss these results on Tuesday, August 11, 2026 at 10:00 AM, Central Time. The conference call will be led by Robert T. Ladd, Chief Executive Officer, and W. Todd Huskinson, Chief Financial Officer, Chief Compliance Officer, Treasurer, and Secretary.
For those wishing to participate by telephone, please dial (888) 506-0062. Use passcode 218557. Starting approximately two hours after the conclusion of the call, a replay will be available through Tuesday, August 25, 2026 by dialing (877) 481-4010 and entering passcode 54324. The replay will also be available on the Company's website.
For those wishing to participate via Live Webcast, connect via the Public (SCIC) section of our website at www.stelluscapital.com, under the Events tab. A replay of the conference will be available on our website for approximately 90 days.
About Stellus Capital Investment Corporation
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. 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 lower middle-market companies (typically those with $5.0 million to $50.0 million of EBITDA (earnings before interest, taxes, depreciation and amortization)) with a focus on investing through first lien (including unitranche) loans, often with a corresponding equity investment. The Company's investment activities are managed by its investment adviser, Stellus Capital Management. To learn more about Stellus Capital Investment Corporation, visit www.stelluscapital.com under the "Public (SCIC)" tab. Stellus Capital Management, LLC was acquired by Ridgepost Capital, LLC on June 22, 2026. Ridgepost Capital, LLC's parent company, Ridgepost Capital, Inc., is a reporting company listed on the New York Stock Exchange. Please reference Ridgepost Capital, Inc.'s periodic filings with the U.S. Securities and Exchange Commission for additional information.
Contacts
Stellus Capital Investment Corporation W. Todd Huskinson, Chief Financial Officer (713) 292-5414 [email protected]
STELLUS CAPITAL INVESTMENT CORPORATION CONSOLIDATED STATEMENTS OF ASSETS AND LIABILITIES
(unaudited)
June 30, 2026
December 31, 2025
ASSETS
Controlled investments, at fair value (amortized cost of $34,691,986 and $33,603,521, respectively)
$
11,573,435
$
14,953,132
Non-controlled, affiliated investments, at fair value (amortized cost of $29,323,333 and $4,806,660, respectively)
32,257,658
3,750,674
Non-controlled, non-affiliated investments, at fair value (amortized cost of $913,612,730 and $987,729,505, respectively)
924,415,324
988,919,589
Cash and cash equivalents
5,138,950
25,050,156
Receivable for sales and repayments of investments
2,166,620
581,509
Interest receivable
5,973,539
6,375,996
Income tax receivable
—
1,385,387
Other receivables
66,430
85,000
Related party receivable
—
20
Deferred offering costs
75,000
—
Prepaid expenses
457,821
150,843
Total Assets
$
982,124,777
$
1,041,252,306
LIABILITIES
2030 Notes Payable
$
122,897,963
$
122,671,409
Credit Facility payable
219,221,522
233,167,360
SBA-guaranteed debentures
257,304,593
295,984,063
Dividends payable
3,248,641
3,858,669
Management fees payable
4,393,771
4,442,705
Income incentive fees payable
889,986
2,317,429
Interest payable
5,569,922
6,138,076
Unearned revenue
496,577
582,007
Administrative services payable
517,253
539,338
Income tax payable
56,518
—
Other accrued expenses and liabilities
570,085
372,294
Total Liabilities
$
615,166,831
$
670,073,350
Commitments and contingencies (Note 7)
Net Assets
$
366,957,946
$
371,178,956
NET ASSETS
Common stock, par value $0.001 per share (100,000,000 shares authorized; 28,672,911 and 28,947,254 shares issued and outstanding, respectively)
$
28,673
$
28,947
Paid-in capital
395,382,385
397,829,793
Total distributable loss
(28,453,112)
(26,679,784)
Net Assets
$
366,957,946
$
371,178,956
Total Liabilities and Net Assets
$
982,124,777
$
1,041,252,306
Net Asset Value Per Share
$
12.80
$
12.82
STELLUS CAPITAL INVESTMENT CORPORATION CONSOLIDATED STATEMENTS OF OPERATIONS (unaudited)
For the three months ended
For the six months ended
June 30, 2026
June 30, 2025
June 30, 2026
June 30, 2025
INVESTMENT INCOME
From non-controlled, affiliated investments
Interest income
$
1,016
$
—
$
1,061
$
—
Payment-in-kind interest income
559,310
—
631,610
—
From non-controlled, non-affiliated investments
Interest income
19,864,060
23,134,800
39,811,025
46,285,437
Payment-in-kind interest income
1,159,038
1,519,405
3,392,735
2,495,884
Other income
719,448
1,042,397
1,759,375
1,866,939
Total Investment Income
$
22,302,872
$
25,696,602
$
45,595,806
$
50,648,260
OPERATING EXPENSES
Management fees
$
4,393,770
$
4,279,441
$
8,786,127
$
8,334,167
Valuation fees
44,995
38,507
211,114
196,396
Administrative services expenses
550,235
474,284
1,199,355
923,582
Income incentive fees
150,863
2,158,075
257,572
4,294,566
Professional fees
283,474
312,808
1,101,201
730,839
Directors' fees
84,250
93,250
213,500
204,500
Insurance expense
102,057
98,668
195,113
195,758
Interest expense and other fees
8,585,467
8,680,015
17,437,008
16,943,034
Income tax expense
29,685
428,951
390,156
928,498
Other general and administrative expenses
585,510
500,302
825,127
718,653
Total Operating Expenses
$
14,810,306
$
17,064,301
$
30,616,273
$
33,469,993
Income incentive fee waiver
(38,583)
(928,926)
(49,644)
(2,171,769)
Total Operating Expenses, net of fee waivers
$
14,771,723
$
16,135,375
$
30,566,629
$
31,298,224
Net Investment Income
$
7,531,149
$
9,561,227
$
15,029,177
$
19,350,036
Net realized loss on controlled investments
$
—
$
(1,132,576)
$
—
$
(1,132,576)
Net realized (loss) gain on non-controlled, non-affiliated investments
(7,243,523)
272,549
(6,493,113)
(5,694,672)
Net realized (loss) gain on foreign currency translations
(1,811)
(20,003)
1,853
(49,658)
Net change in unrealized (depreciation) appreciation on controlled investments
(922,785)
1,290,491
(4,468,162)
1,345,767
Net change in unrealized appreciation on non-controlled, affiliated investments
3,913,525
—
3,468,901
—
Net change in unrealized appreciation on non-controlled, non-affiliated investments
12,908,698
143,176
10,350,353
1,281,193
Net change in unrealized appreciation (depreciation) on foreign currency translations
21,045
30,546
(26,975)
38,865
Net Increase in Net Assets Resulting from Operations
$
16,206,298
$
10,145,410
$
17,862,034
$
15,138,955
Net Investment Income Per Share—basic and diluted
$
0.26
$
0.34
$
0.52
$
0.69
Net Increase in Net Assets Resulting from Operations Per Share – basic and diluted
$
0.56
$
0.36
$
0.62
$
0.54
Weighted Average Shares of Common Stock Outstanding—basic and diluted
28,869,028
28,412,849
28,907,925
28,009,969
Distributions Per Share—basic and diluted
$
0.34
$
0.40
$
0.68
$
0.80
STELLUS CAPITAL INVESTMENT CORPORATION CONSOLIDATED STATEMENTS OF CHANGES IN NET ASSETS (unaudited)
Common Stock
Total
Number
Par
Paid-in
distributable
of shares
value
capital
(loss)
Net Assets
Balances at December 31, 2024
27,481,118
$
27,481
$
379,549,272
$
(9,654,813)
$
369,921,940
Net investment income
—
—
—
9,788,809
9,788,809
Net realized loss on investments
—
—
—
(5,967,221)
(5,967,221)
Net realized loss on foreign currency translations
—
—
—
(29,655)
(29,655)
Net change in unrealized appreciation on investments
—
—
—
1,193,293
1,193,293
Net change in unrealized depreciation on foreign currency translations
—
—
—
8,319
8,319
Distributions from net investment income
—
—
—
(11,087,389)
(11,087,389)
Issuance of common stock, net of offering costs(1)
656,085
656
8,937,430
—
8,938,086
Balances at March 31, 2025
28,137,203
$
28,137
$
388,486,702
$
(15,748,657)
$
372,766,182
Net investment income
—
—
—
9,561,227
9,561,227
Net realized loss on investments
—
—
—
(860,027)
(860,027)
Net realized loss on foreign currency translations
—
—
—
(20,003)
(20,003)
Net change in unrealized appreciation on investments
—
—
—
1,433,667
1,433,667
Net change in unrealized appreciation on foreign currency translations
—
—
—
30,546
30,546
Provision for taxes on unrealized appreciation on investments
—
—
—
—
—
Distributions from net investment income
—
—
—
(11,363,618)
(11,363,618)
Issuance of common stock, net of offering costs(1)
278,945
279
3,822,637
—
3,822,916
Balances at June 30, 2025
28,416,148
$
28,416
$
392,309,339
$
(16,966,865)
$
375,370,890
Balances at December 31, 2025
28,947,254
$
28,947
$
397,829,793
$
(26,679,784)
$
371,178,956
Net investment income
—
—
—
7,498,028
7,498,028
Net realized gain on investments
—
—
—
750,410
750,410
Net realized gain on foreign currency translation
—
—
—
3,664
3,664
Net change in unrealized depreciation on investments
—
—
—
(6,548,346)
(6,548,346)
Net change in unrealized depreciation on foreign currency translations
—
—
—
(48,020)
(48,020)
Distributions from net investment income
—
—
—
(9,839,171)
(9,839,171)
Balances at March 31, 2026
28,947,254
$
28,947
$
397,829,793
$
(34,863,219)
$
362,995,521
Net investment income
—
—
—
7,531,149
7,531,149
Net realized loss on investments
—
—
—
(7,243,523)
(7,243,523)
Net realized loss on foreign currency translation
—
—
—
(1,811)
(1,811)
Net change in unrealized appreciation on investments
—
—
—
15,899,438
15,899,438
Net change in unrealized appreciation on foreign currency translations
—
—
—
21,045
21,045
Distributions from net investment income
—
—
—
(9,796,191)
(9,796,191)
Repurchase of common stock, net of commissions(1)
(274,343)
(274)
(2,447,408)
—
(2,447,682)
Balances at June 30, 2026
28,672,911
$
28,673
$
395,382,385
$
(28,453,112)
$
366,957,946
STELLUS CAPITAL INVESTMENT CORPORATION CONSOLIDATED STATEMENTS OF CASH FLOWS (unaudited)
For the six months ended
June 30, 2026
June 30, 2025
Cash Flows from Operating Activities
Net increase in net assets resulting from operations
$
17,862,034
$
15,138,955
Adjustments to reconcile net increase in net assets from operations to net cash used in operating activities:
Purchases of investments
(45,678,450)
(78,230,159)
Proceeds from sales and repayments of investments
90,888,206
46,638,287
Net change in unrealized appreciation on investments
(9,351,092)
(2,626,960)
Net change in unrealized depreciation (appreciation) on foreign currency translations
26,975
(38,865)
Increase in investments due to payment-in-kind income
(3,392,735)
(2,492,551)
Amortization of premium and accretion of discount, net
(1,383,610)
(1,437,223)
Amortization of loan structure fees
511,422
634,745
Amortization of deferred financing costs
270,866
303,468
Amortization of discount on Notes Payable
67,121
31,434
Amortization of premium on Notes Payable
(61,432)
—
Amortization of loan fees on SBA-guaranteed debentures
320,530
371,260
Net realized loss on investments
6,493,113
6,827,248
Changes in other assets and liabilities
Decrease (increase) in interest receivable
402,457
(921,344)
Decrease (increase) in income tax receivable
1,385,387
(743,732)
Decrease in other receivables
18,570
70,495
Decrease in related party receivables
20
3,687
(Increase) decrease in prepaid expenses
(306,978)
218,975
(Decrease) increase in management fees payable
(48,934)
245,332
Decrease in income incentive fees payable
(1,427,443)
(1,057,366)
(Decrease) increase in administrative services payable
(22,085)
22,297
(Decrease) increase in interest payable
(568,154)
1,248,079
Increase in related party payable
—
1,088,287
(Decrease) increase in unearned revenue
(85,430)
127,664
Increase in income tax payable
56,518
—
Increase in other accrued expenses and liabilities
197,791
1,322,363
Net Cash Provided by (Used in) Operating Activities
$
56,174,667
$
(13,255,624)
Cash Flows from Financing Activities
Proceeds from the issuance of common stock
$
—
$
13,153,366
Sales load for common stock issued
—
(197,464)
Offering costs paid for common stock issued
(75,000)
(303,959)
Payment for repurchase of common stock
(2,436,708)
—
Commission for repurchase of common stock
(10,975)
—
Stockholder distributions paid
(20,245,390)
(22,326,367)
Financing costs paid on Notes Payable
(50,000)
(1,698,806)
Repayments of SBA-guaranteed debentures
(39,000,000)
(16,250,000)
Borrowings under Credit Facility
92,200,000
104,400,000
Repayments of Credit Facility
(106,467,800)
(117,817,800)
Net Cash (Used in) Provided by Financing Activities
$
(76,085,873)
$
33,188,720
Net (Decrease) Increase in Cash and Cash Equivalents
$
(19,911,206)
$
19,933,096
Cash and Cash Equivalents Balance at Beginning of Period
$
25,050,156
$
20,058,594
Cash and Cash Equivalents Balance at End of Period
$
5,138,950
$
39,991,690
Supplemental and Non-Cash Activities
Cash paid for interest expense
$
16,896,905
$
14,354,048
Income and excise tax refund, net
(1,051,749)
1,672,230
Exchange of investments
8,670,888
1,663,301
Reconciliation of Core Net Investment Income(1) (Unaudited)
Three Months Ended
Six Months Ended
June 30, 2026
June 30, 2025
June 30, 2026
June 30, 2025
Net investment income
$7,531,149
$9,561,227
$15,029,177
$19,350,036
Income tax expense
29,685
428,951
390,156
928,498
Core net investment income
$7,560,834
$9,990,178
$15,419,333
$20,278,534
Per share amounts:
Net investment income per share
$0.26
$0.34
$0.52
$0.69
Core net investment income per share
$0.26
$0.35
$0.53
$0.72
Reconciliation of Realized Net Investment Income(2) (Unaudited)
Three Months Ended
Six Months Ended
June 30, 2026
June 30, 2025
June 30, 2026
June 30, 2025
Net investment income
$7,531,149
$9,561,227
$15,029,177
$19,350,036
Net realized loss on investments
(7,243,523)
(860,027)
(6,493,113)
(6,827,248)
Net realized (loss) gain on foreign currency translation
(1,811)
(20,003)
1,853
(49,658)
Total realized net investment income
$285,815
$8,681,197
$8,537,917
$12,473,130
Per share amounts:
Net investment income per share
$0.26
$0.34
$0.52
$0.69
Realized net investment income per share
$0.01
$0.31
$0.30
$0.45
Summary
HOUSTON, Aug. 10, 2026 /PRNewswire/ -- Stellus Capital Investment Corporation (NYSE: SCM) ("Stellus", "we", or the "Company") today announced financial results for its fiscal quarter ended June 30, 2026. Robert T. Ladd, Chief Executive Officer of Stellus, stated, "I am pleased to report...