Horizon Technology Finance Corp (HRZN) 2024 Q3 法說會逐字稿

Greetings, and welcome to the Horizon Technology Finance Corporation third-quarter 2024 earnings call. (Operator Instructions). As a reminder, this conference is being recorded.

大家好，歡迎參加 Horizo​​n Technology Finance Corporation 2024 年第三季財報電話會議。（操作員指令）。提醒一下，本次會議正在錄音。

It is now my pleasure to introduce Megan Bacon. Thank you. You may begin.

現在我很高興介紹梅根培根。謝謝。你可以開始了。

Thank you, and welcome to Horizon Technology Finance Corporation's third-quarter 2024 conference call. Representing the company today are Rob Pomeroy, Chairman and Chief Executive Officer; Jerry Michaud, President; Dan Devorsetz, Chief Operating Officer and Chief Investment Officer; and Dan Trolio, Chief Financial Officer.

謝謝，歡迎參加 Horizo​​n Technology Finance Corporation 2024 年第三季電話會議。今天代表公司的是董事長兼執行長 Rob Pomeroy；總裁 Jerry Michaud； Dan Devorsetz，營運長兼首席投資長；以及財務長 Dan Trolio。

I would like to point out that the Q3 earnings press release and Form 10-Q are available on the company's website at horizontechfinance.com.

我想指出的是，第三季收益新聞稿和 10-Q 表可在公司網站 horizo​​​​ntechfinance.com 上查閱。

Before we begin our formal remarks, I remind everyone that during this conference call, the company will make certain forward-looking statements, including statements with regard to the future performance of the company. Words such as believes, expects, anticipates, intends or similar expressions are used to identify forward-looking statements. These forward-looking statements are subject to the inherent uncertainties in predicting future results and conditions.

在我們開始正式發言之前，我提醒大家，在本次電話會議中，公司將做出某些前瞻性陳述，包括有關公司未來業績的陳述。相信、期望、預期、打算或類似表達等詞語可用於識別前瞻性陳述。這些前瞻性陳述受預測未來結果和條件的固有不確定性的影響。

Certain factors could cause actual results to differ on a material basis from those projected in these forward-looking statements, and some of these factors are detailed in the risk factor discussion in the company's filings with the Securities and Exchange Commission, including the company's Form 10-K for the year ended December 31, 2023. The company undertakes no obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

某些因素可能導致實際結果與這些前瞻性陳述中的預測結果有重大差異，其中一些因素在公司提交給美國證券交易委員會的文件中的風險因素討論中有詳細說明，包括公司截至 2023 年 12 月 31 日的 10-K 表格。無論因新資訊、未來事件或其他原因，本公司均不承擔更新或修改任何前瞻性陳述的義務。

At this time, I would like to turn the call over to Rob Pomeroy.

現在，我想將電話轉給 Rob Pomeroy。

Welcome, everyone, and thank you for your interest in Horizon. Today, we will update you on our performance and our current overall operating environment. Dan Devorsetz will take us through recent business and portfolio developments. Jerry will then discuss the current status of the venture lending market, and Dan Trolio will detail our operating performance and financial condition. We will then take some questions.

歡迎大家，感謝您對 Horizo​​n 的關注。今天，我們將向您介紹我們的業績和當前的整體營運環境。Dan Devorsetz 將向我們介紹最近的業務和投資組合發展。隨後，Jerry 將討論風險貸款市場的現狀，Dan Trolio 將詳細介紹我們的營運表現和財務狀況。然後我們將回答一些問題。

As we expected, our portfolio grew in the third quarter while we improved our credit profile. Our adviser and its experienced and expert team will remain focused on our portfolio's credit quality and originating high-quality investments in order to maximize the value of our portfolio over the long term.

正如我們預期的那樣，我們的投資組合在第三季度實現成長，同時我們的信用狀況也得到改善。我們的顧問及其經驗豐富的專家團隊將繼續專注於我們投資組合的信用品質和發起高品質投資，以便長期最大化我們投資組合的價值。

Turning to our specific results for the quarter. We generated net investment income of $0.32 per share, $0.01 below our declared distribution level. As we grow our portfolio in the future quarters, it is our goal to deliver NII at or above our declared distributions over time. Based on our outlook and our undistributed spillover income, our Board declared regular monthly distributions of $0.11 per share through March of 2025.

談談本季的具體業績。我們產生的每股淨投資收益為 0.32 美元，比我們宣布的分配水準低 0.01 美元。隨著我們在未來幾季擴大投資組合，我們的目標是隨著時間的推移，實現等於或高於我們宣布的分配的 NII。根據我們的展望和未分配的溢出收入，董事會宣布截至 2025 年 3 月每月定期分配每股 0.11 美元。

We once again achieved a portfolio yield on debt investments at or near the top of the BDC industry. We enhanced our investment capacity by raising equity from our at-the-market program. Finally, we grew the size of our portfolio by 6% and increased our committed and approved backlog, providing us with a solid base of opportunities to further grow our portfolio.

我們的債務投資組合收益率再次達到或接近 BDC 行業最高。我們透過市場計劃籌集股本，增強了我們的投資能力。最後，我們的投資組合規模擴大了 6%，並增加了已承諾和已批准的積壓訂單，為我們進一步擴大投資組合提供了堅實的機會基礎。

As the macro environment improves and the venture ecosystem recovers, we are continuing to work closely with and support our portfolio companies as we focus on our overall credit profile and maximizing the value of our stressed investments.

隨著宏觀環境的改善和風險投資生態系統的復甦，我們將繼續與我們的投資組合公司密切合作並為他們提供支持，同時關注我們的整體信用狀況並最大化我們的不良投資的價值。

As we close out 2024, we remain optimistic about Horizon prospects for the following reasons. Our portfolio was growing, and our portfolio yield remains among the industry's highest. Our pipeline is full with quality new customer opportunities. Our liquidity and balance sheet are strong. And finally, our markets are active and demand for venture debt capital is growing. We are uniquely capable of providing such capital and look forward to doing so.

隨著 2024 年的結束，我們仍然對 Horizo​​n 的前景持樂觀態度，原因如下。我們的投資組合不斷成長，投資組合收益率仍位居行業最高之列。我們的通路充滿了優質的新客戶機會。我們的流動性和資產負債表強勁。最後，我們的市場活躍，對風險債務資本的需求正在增加。我們有獨特的能力提供此類資本，並且期待這樣做。

Finally, before I turn the call over, I want to comment on the strategic partnership that Monroe Capital announced last week. As you know, Monroe, the owner of our adviser, has announced its plans to partner with Wendel Group, a French investment company, through Wendel's purchase of an ownership interest in Monroe Capital as well as a $1 billion commitment of capital to support new and existing investment strategies of the Monroe platform, including venture debt.

最後，在轉交電話之前，我想對 Monroe Capital 上週宣布的策略合作夥伴關係發表評論。如您所知，我們的顧問公司所有者 Monroe 已宣布計劃與法國投資公司 Wendel Group 合作，透過 Wendel 收購 Monroe Capital 的所有權權益以及 10 億美元的資本承諾來支持 Monroe 平台的新投資和現有投資策略，包括風險債務。

Monroe, and by extension our adviser, will continue to operate independently and its investment process, strategy and operations will remain the same. As part of the Monroe family, Horizon will benefit from the additional capital scale and commitment of the partnership between Monroe and Wendel Group. The transaction is expected to close in the first quarter of 2025.

Monroe 以及我們的顧問將繼續獨立運營，其投資流程、策略和營運也將保持不變。作為Monroe家族的一部分，Horizo​​n將受益於Monroe和Wendel Group合作帶來的額外資本規模和承諾。該交易預計將於 2025 年第一季完成。

Again, we appreciate your continued interest and support in the Horizon Technology Finance platform. I will now turn the call over to Dan, Jerry and Dan to give you the details of our third quarter results and progress. Dan?

再次感謝您對Horizo​​​​n Technology Finance平台的持續關注和支持。現在我將把電話轉給丹、傑瑞和丹，向你們詳細介紹我們的第三季業績和進展。擔？

Thanks, Rob, and good morning to everyone. We grew our portfolio in the third quarter to $684 million as we originated a number of high-quality loans that more than offset prepayments and normal portfolio amortization. In the third quarter, we funded nine debt investments totaling $93 million. Five of these investments were in new portfolio companies, most of whom recently raised significant round of equity.

謝謝，羅布，大家早安。由於我們發放了大量高品質貸款，這些貸款足以抵消預付款和正常的投資組合攤銷，因此我們的投資組合在第三季度增長至 6.84 億美元。第三季度，我們完成了九項債務投資，總額達 9,300 萬美元。其中五項投資是針對新投資組合公司，其中大多數最近籌集了大量股權。

As we noted on our last call, we are seeing an increasing and healthy volume of high-quality opportunities in the second half of 2024 and have the resources to convert these opportunities into new investments. We also continue to replenish and build our pipeline across our target sectors with the volume of new opportunities under review currently at its highest level in several quarters.

正如我們在上次電話會議上指出的那樣，我們看到 2024 年下半年的優質投資機會數量不斷增加，並且健康成長，我們擁有將這些機會轉化為新投資的資源。我們還將持續補充和建立目標行業的管道，目前正在審查的新機會數量已達到幾個季度以來的最高水平。

Looking ahead to Q4, we expect our pipeline to produce another quarter of portfolio growth. Thus far in October, we have already been awarded five new venture loan transactions, representing $90 million in total payments with much of that total to potentially fund in Q4. That said, we will always be disciplined in our approach to originating loans.

展望第四季度，我們預期我們的產品線將帶來另一個季度的投資組合成長。截至 10 月份，我們已經獲得五筆新的風險貸款交易，總額達 9,000 萬美元，其中大部分可能在第四季度提供資金。儘管如此，我們在發放貸款時始終保持嚴謹的態度。

During the quarter, we experienced four loan prepayments totaling $38 million in prepaid principal. These payments are evidence of an improving venture market and help generate additional income. Although prepayments remain on the lower end of our historical levels, prepayments are a testament to our predictive pricing strategy where we structure and price our loans to take into account early prepayments.

本季度，我們經歷了四次貸款預付，預付本金總額為 3,800 萬美元。這些付款證明了創投市場正在改善並有助於產生額外收入。儘管預付款仍處於歷史低位，但預付款證明了我們的預測定價策略，我們在建立和定價貸款時將提前預付款考慮在內。

While we did not see any prepayments in the quarter that were driven by IPOs or M&A activity, in October, one of our portfolio companies, Ceribell, completed its oversubscribed IPO, and we are pleased that we continue to have a debt investment in Ceribell and that its stock is performing well.

雖然我們在本季度沒有看到 IPO 或併購活動推動的任何預付款，但 10 月份，我們的投資組合公司之一 Ceribell 完成了超額認購的 IPO，我們很高興繼續對 Ceribell 進行債務投資，並且其股票表現良好。

Our onboarding debt investment yield of 13.2% during the third quarter remained high compared to our historic levels. We expect to continue to generate strong onboarding yields with our current pipeline of opportunities, further demonstrating our capabilities to grow our portfolio profitably and continue to produce strong net investment income.

我們第三季的入職債務投資收益率為 13.2%，與歷史水準相比仍然較高。我們期望利用目前的機會管道繼續產生強勁的入職收益，進一步證明我們有能力盈利地增加投資組合併繼續產生強勁的淨投資收益。

Our debt portfolio yield of 15.9% for the quarter was once again one of the highest-yielding debt portfolios in the BDC industry. Our ability to generate these industry-leading yields continues to be a testament to the profitability of our venture lending strategy and our execution of that strategy across various market cycles and interest rate environments.

我們本季的債務組合收益率為 15.9%，再次成為 BDC 產業收益率最高的債務組合之一。我們產生這些行業領先收益的能力繼續證明了我們的風險貸款策略的獲利能力以及我們在各種市場週期和利率環境下對該策略的執行。

As of September 30, we held warrant and equity positions in 103 portfolio companies with a fair value of $33 million. Structuring investments with warrants and equity rights is a key component of our venture debt strategy and a potential generator of shareholder value.

截至 9 月 30 日，我們持有 103 家投資組合公司的認股權證和股票，公允價值為 3,300 萬美元。透過認股權證和股權來建構投資是我們的風險債務策略的關鍵組成部分，也是股東價值的潛在創造者。

In the third quarter, we closed $173 million in new loan commitments and approvals and ended the quarter with a committed and approved backlog of $190 million compared to $138 million at the end of the second quarter. We believe our pipeline, combined with our committed backlog with most of our funding commitments subject to companies achieving certain key milestones, provides a solid base to prudently grow our portfolio.

第三季度，我們完成了 1.73 億美元的新貸款承諾和批准，本季末的承諾和批准積壓金額為 1.9 億美元，而第二季末為 1.38 億美元。我們相信，我們的產品線加上我們已承諾的訂單（其中大部分資金承諾取決於公司實現某些關鍵里程碑），為審慎擴大我們的投資組合提供了堅實的基礎。

As of quarter end, 91% of the fair value of our debt portfolio consists of 3- and 4-rated debt investments compared to 88% on June 30. 9% of the fair value of our portfolio was rated to a 1, down from 12% on June 30.

截至季末，我們債務投資組合的公允價值中有 91% 由 3 級和 4 級債務投資組成，而 6 月 30 日這一比例為 88%。

We made progress on several of our stressed investments using a variety of strategies to maximize current recovery and create opportunities for potential future value. We will continue to work closely with companies across our portfolio, collaborating with management teams and investors to generate optimal returns from our investments.

我們透過多種策略在多項緊張的投資上取得了進展，以最大限度地提高當前的復甦並為潛在的未來價值創造機會。我們將繼續與投資組合中的公司密切合作，與管理團隊和投資者合作，從我們的投資中獲得最佳回報。

To summarize, we remain optimistic about continuing to grow our portfolio in the quarters ahead. The current portfolio continues to benefit from elevated interest rates, and we'll continue to work with our borrowers to maximize outcomes.

總而言之，我們對於未來幾季繼續擴大我們的投資組合仍然保持樂觀。目前的投資組合繼續受益於利率上升，我們將繼續與借款人合作，以實現收益最大化。

With that, I'll turn it over to Jerry for a look at the overall venture industry and current environment.

說到這裡，我將把話題交給傑瑞，讓他來看看整個創投產業和當前的環境。

Thank you very much, Dan. Turning to the venture capital environment. According to PitchBook, approximately $38 billion was invested in VC-backed companies in the third quarter as the industry remains on pace to match 2023 total, though it is still well off the highs of 2021 and 2022.

非常感謝，丹。轉向創投環境。PitchBook 的數據顯示，第三季創投支持的公司獲得了約 380 億美元的投資，該產業仍有望達到 2023 年的總額，儘管仍遠低於 2021 年和 2022 年的高點。

As we noted last quarter, there continues to be a backlog of venture capital-backed technology and life science companies and are well positioned for an opportunity to complete an exit by way of M&A or an IPO.

正如我們上個季度所指出的，由創投支持的科技和生命科學公司仍然積壓，並且有機會透過併購或 IPO 的方式完成退出。

While Q3 total exit value of $10 billion was the lowest in five quarters, there were positive indications that the life science market in particular is starting to draw renewed interest from knowledgeable life science investors. There were five life science IPOs in September alone. In October, there have been four more life science IPOs, including Horizon's portfolio company, Ceribell. In addition, several large life science private equity funds were raised in the quarter, led by Bain Capital's $2.5 billion life science fund and Goldman Sachs &650 million life science fund.

儘管第三季的總退出價值為 100 億美元，為五個季度以來的最低水平，但有積極跡象表明，生命科學市場尤其開始吸引知識淵博的生命科學投資者的新興趣。光是 9 月就有 5 家生命科學公司進行 IPO。10 月份，又有四家生命科學公司進行 IPO，其中包括 Horizo​​n 的投資組合公司 Ceribell。此外，本季還募集了幾支大型生命科學私募股權基金，其中貝恩資本募集的25億美元生命科學基金和高盛募集的6.5億美元生命科學基金領漲。

Big pharma also has started becoming more interested in acquiring drug discovery companies as they have a need in the next few years to replace blockbuster drugs coming off patent with new drugs with high revenue growth potential.

大型製藥公司也開始對收購藥物研發公司越來越感興趣，因為它們需要在未來幾年內用具有高收入成長潛力的新藥來取代即將到期專利的暢銷藥。

Over the next few quarters, the combination of lower interest rates and the lowering of emerging growth in life science company valuations should accelerate the demand for acquisitions or IPOs of high-quality technology and life science companies.

在接下來的幾個季度中，較低的利率和新興生命科學公司估值的下降將加速對優質技術和生命科學公司的收購或 IPO 的需求。

Based on our existing pipeline of over $1 billion of debt opportunities, Horizon believes there is a very strong opportunity in the coming quarters to provide venture debt financing to high-quality technology and life science companies who will need additional liquidity as they evaluate the improving exit markets.

根據我們現有的超過 10 億美元債務機會，Horizo​​​​n 認為未來幾季有非常好的機會為高品質的技術和生命科學公司提供風險債務融資，這些公司在評估不斷改善的退出市場時將需要額外的流動性。

While the overall VC ecosystem has been challenging for an extended period, we believe the conditions for an overall improvement in VC-backed company exit markets for the return of capital to LPs and for new fundraising are showing signs of turning the corner.

雖然整個創投生態系統長期以來一直充滿挑戰，但我們相信，創投支持的公司退出市場、向 LP 返還資本以及進行新融資的條件正在全面改善，正在出現好轉的跡象。

The macroeconomic impacts of the continuation of lower interest rates, the global need for large tech companies and big pharma companies to remain competitive by acquiring new technologies combined with the specific technology achievements of VC-backed tech companies and life science companies are beginning to create strong overall market conditions for the VC ecosystem leading into 2025.

持續低利率的宏觀經濟影響、全球範圍內大型科技公司和大型製藥公司透過收購新技術來保持競爭力的需求，再加上風險投資支持的科技公司和生命科學公司的特定技術成就，這些都開始為 2025 年的風險投資生態系統創造強勁的整體市場條件。

Accordingly, we remain optimistic about originating a number of new high-quality venture debt investments in the weeks and months ahead. Our optimism is bolstered by our robust pipeline today of about $1.2 billion, a testament to our reputation, brand and sourcing capabilities.

因此，我們對於未來幾週和幾個月內發起一些新的高品質風險債務投資仍然持樂觀態度。我們目前擁有約 12 億美元的強勁儲備，這增強了我們的樂觀情緒，證明了我們的聲譽、品牌和採購能力。

To sum up, we remain committed to sourcing high-quality, well-priced investments to grow our portfolio in the fourth quarter and in 2025, which will generate sustainable NII and build additional long-term value for our shareholders. We also remain committed to focus on maintaining credit quality and providing our portfolio companies with support as needed to ensure optimal investment outcomes.

總而言之，我們仍然致力於尋找高品質、價格合理的投資，以在第四季度和 2025 年擴大我們的投資組合，這將產生可持續的 NII 並為我們的股東創造額外的長期價值。我們還將繼續致力於維護信用品質並根據需要為我們的投資組合公司提供支持，以確保獲得最佳投資結果。

With that, I'll now turn the call over to Dan Trolio.

說完這些，我現在將電話轉給 Dan Trolio。

Thanks, Jerry, and good morning, everyone. We continue to strengthen our balance sheet in the third quarter and into October. First, we continue to opportunistically access our ATM program as we successfully and accretively sold over 1.7 million shares in the quarter, raising over $18 million of equity capital.

謝謝，傑瑞，大家早安。我們在第三季和十月繼續加強我們的資產負債表。首先，我們繼續抓住機會利用我們的 ATM 計劃，因為我們在本季度成功且增值地出售了超過 170 萬股股票，籌集了超過 1800 萬美元的股本。

In addition, in October, we raised $20 million of debt capital through the issuance of our 7 1/8 unsecured convertible notes due 2031. The notes may only be converted into common stock at a price greater or equal to our NAV. We are always seeking to add flexibility and diversity to our capital sources, and we believe the convertible notes achieve that. We will continue to focus on maintaining a strong balance sheet in the coming quarters in order to enable us to further grow the portfolio.

此外，10 月份，我們透過發行 2031 年到期的 7 1/8 無擔保可轉換票據籌集了 2,000 萬美元的債務資本。這些票據只能以高於或等於我們的資產淨值的價格轉換為普通股。我們一直在尋求增加我們的資本來源的靈活性和多樣性，我們相信可轉換票據可以實現這一點。我們將繼續致力於在未來幾季維持強勁的資產負債表，以便我們進一步擴大投資組合。

As of September 30, we had $125 million in available liquidity, consisting of $87 million in cash and $38 million in funds available to be drawn under our existing credit facilities. We currently have no borrowings outstanding under our $150 million KeyBank credit facility, $181 million outstanding on our $250 million New York Life credit facility and $50 million outstanding on our new $100 million Nuveen credit facility, leaving us with ample capacity to grow our portfolio of debt investments.

截至 9 月 30 日，我們擁有 1.25 億美元的可用流動資金，其中包括 8,700 萬美元現金和 3,800 萬美元可根據現有信貸安排提取的資金。目前，我們在 1.5 億美元 KeyBank 信貸安排下沒有未償還借款，我們在 2.5 億美元紐約人壽信貸安排下有 1.81 億美元未償還借款，在我們新的 1 億美元 Nuveen 信貸安排下有 5,000 萬美元未償還借款，因此我們有充足的能力來擴大我們的債務投資組合。

Our debt-to-equity ratio stood at 1.28:1 as of September 30. And netting out cash on our balance sheet, our net leverage was approximately 1:1, which is well within our target leverage. Based on our cash position and our borrowing capacity on our credit facility, our potential new investment capacity as of September 30 was $356 million.

截至 9 月 30 日，我們的負債權益比為 1.28:1。扣除資產負債表上的現金，我們的淨槓桿比率約為 1：1，完全符合我們的目標槓桿率。根據我們的現金狀況和信貸額度的借貸能力，截至 9 月 30 日，我們的潛在新投資能力為 3.56 億美元。

Turning to our operating results. For the third quarter, we earned investment income of $25 million compared to $29 million in the prior year period primarily due to lower interest income and fee income on our debt investment portfolio. Our debt investment portfolio on a net cost basis stood at $654 million as of September 30 compared to $675 million as of June 30, 2024.

談到我們的經營績效。第三季度，我們的投資收益為 2,500 萬美元，而去年同期的投資收益為 2,900 萬美元，這主要由於我們的債務投資組合的利息收入和費用收入減少。截至 9 月 30 日，我們的債務投資組合以淨成本計算為 6.54 億美元，而截至 2024 年 6 月 30 日為 6.75 億美元。

For the third quarter of '24, we achieved onboarding yields of 13.2% compared to 13.7% achieved in the second quarter. Our loan portfolio yield was 15.9% for the third quarter compared to 17.1% for last year's third quarter. Total expenses for the quarter were $12.4 million compared to $11.6 million in the third quarter of '23. Our interest expense increased to $7.9 million from $7.1 million in last year's third quarter due to an increase in our average borrowings. Our base management fee was $3 million, down from $3.2 million in the prior year period.

24年第三季度，我們的入職收益率為13.2%，而第二季度為13.7%。我們第三季的貸款組合收益率為 15.9%，而去年第三季為 17.1%。本季總支出為 1,240 萬美元，而 23 年第三季為 1,160 萬美元。由於平均借款額增加，我們的利息支出從去年第三季的 710 萬美元增加到 790 萬美元。我們的基本管理費為 300 萬美元，低於去年同期的 320 萬美元。

We received no performance-based incentive fees in the third quarter as we continue to experience a deferral of incentive fees otherwise earned by our adviser under our incentive fee cap and deferral mechanism. The deferral in the quarter was driven by net realized and unrealized losses on our portfolio. We expect that the adviser will return to earning incentive fees in the coming quarters.

我們在第三季沒有收到基於績效的激勵費用，因為我們繼續根據激勵費用上限和延期機制延期償還顧問應得的激勵費用。本季的遞延是由於我們投資組合的淨已實現和未實現損失所致。我們預計該顧問將在未來幾季恢復賺取激勵費用。

Net investment income for the third quarter of '24 was $0.32 per share compared to $0.36 per share in the second quarter of '24 and $0.53 per share for the third quarter of '23. The company's undistributed spillover income as of September 30 was $1.27 per share. We anticipate that the size of our portfolio, along with the portfolio's elevated interest rates and our predictive pricing strategy, will enable us to continue generating NII that covers our distribution over time. While the macro environment is beginning to improve, we expect prepayment activities will remain modest in the near term.

24 年第三季的淨投資收益為每股 0.32 美元，而 24 年第二季為每股 0.36 美元，23 年第三季為每股 0.53 美元。截至 9 月 30 日，該公司未分配溢出收益為每股 1.27 美元。我們預計，我們的投資組合的規模、投資組合的高利率以及我們的預測定價策略將使我們能夠繼續產生能夠覆蓋我們長期分配的NII。雖然宏觀環境開始改善，但我們預計短期內預付款活動仍將保持溫和。

To summarize our portfolio activities for the third quarter, new originations totaled $93 million, which were partially offset by $13 million in scheduled principal payments and $40 million in principal prepayments and partial pay downs. We ended the quarter with a total investment portfolio of $684 million. We expect to further grow our portfolio during the fourth quarter.

總結我們第三季的投資組合活動，新發起額總計 9,300 萬美元，其中部分被 1,300 萬美元的預定本金支付和 4,000 萬美元的本金預付及部分償還所抵消。截至本季末，我們的投資組合總額為 6.84 億美元。我們預計第四季我們的投資組合將進一步擴大。

At September 30, the portfolio consisted of debt investments with 53 companies with an aggregate fair value of $633 million and a portfolio of warrant, equity and other investments in 108 companies with an aggregate fair value of $51 million.

截至 9 月 30 日，該投資組合包括對 53 家公司的債務投資，總公允價值為 6.33 億美元，以及對 108 家公司的認股權證、股票和其他投資，總公允價值為 5,100 萬美元。

Based upon our outlook, our Board declared monthly distributions of $0.11 per share for January, February and March 2025. We remain committed to providing our shareholders with distributions that are covered by our net investment income over time.

根據我們的展望，董事會宣布 2025 年 1 月、2 月和 3 月每月每股分配 0.11 美元。我們仍然致力於向股東提供由我們的淨投資收益長期涵蓋的分配。

Our NAV as of September 30 was $9.06 per share compared to $9.12 as of June 30, 2024, and $10.41 as of September 30, 2023. The $0.06 reduction in NAV on a quarterly basis was primarily due to our paid distribution and adjustments to fair value, partially offset by net investment income and accretive sales of equity.

截至 9 月 30 日，我們的每股淨值為 9.06 美元，而截至 2024 年 6 月 30 日為 9.12 美元，截至 2023 年 9 月 30 日為 10.41 美元。季度淨資產價值減少 0.06 美元，主要由於我們的支付分配和公允價值調整，部分被投資淨收益和股權增值銷售所抵銷。

As we've consistently noted, nearly 100% of the outstanding principal amounts of our debt investments bear interest at floating rates with coupons that are structured to increase if interest rates rise with interest rate floors that will mitigate the impact of decreasing interest rates.

正如我們一直指出的那樣，我們債務投資中幾乎 100% 的未償還本金都按浮動利率計息，且票面利率會隨著利率上升而增加，而利率下限將減輕利率下降的影響。

This concludes our opening remarks. We'll be happy to take questions you may have at this time.

我們的開場白到此結束。我們很樂意解答您此時可能提出的問題。

(Operator Instructions)

（操作員指令）

Douglas Harter, UBS.

瑞銀的道格拉斯·哈特。

Hoping you could just give us a bit of an update on the nonaccrual loans and kind of the -- how we should think about the time lines for resolutions on those?

希望您能向我們提供一些有關不計息貸款的最新情況，以及我們應該如何考慮解決這些問題的時間表？

So this is Dan Devorsetz. There are -- we're working on a couple of different strategies for the nonaccruals. Some of them have been resolved here in Q3, as you see in the numbers, with either acquisitions or other transactions. There's a couple of others that are -- that we're working on in real time. That will take a little bit more time to resolve. I think that there'll be -- some of it will be resolved here in Q4, and a couple of others might linger into the first half of 2025. But each one is its own specific time line and strategy.

這是 Dan Devorsetz。我們正在研究幾種不同的不提策略。正如您在數字中看到的，其中一些問題已在第三季度透過收購或其他交易解決。還有其他一些問題我們正在即時處理。解決這個問題需要更多時間。我認為，部分問題將在第四季解決，其他一些問題可能會持續到 2025 年上半年。但每一個都有自己特定的時間表和策略。

Great. And I guess, just how are you -- the ones that you resolved in Q3 kind of -- if you could just give us a little more detail on kind of how those resolved versus kind of your expectations going into the quarter?

偉大的。我想，您如何看待您在第三季解決的問題？

Sure. So one of them Nexii was the assets were sold to a third-party buyer, a high-quality buyer, and that company is operating the company. And we marked the assets based upon the transaction that occurred. We have debt and equity in the new company. So that was that one. Evelo, Jerry, do you want to talk about Evelo a little bit?

當然。其中之一就是 Nexii 將資產出售給第三方買家，一個優質買家，而該公司正在經營該公司。我們根據發生的交易標記資產。我們在新公司擁有債務和股權。就是這樣的。Evelo，Jerry，你想談談 Evelo 嗎？

Sure. So Evelo, as a life science company has significant life science assets that they are looking to monetize. And so they put all those assets into a holding company. There were a number of transactions that are underway right now. One actually did close in the third quarter. And all the proceeds that will be coming from those transactions, some of the proceeds are contractual, due to Evelo over time. They will flow to Horizon to continue to pay down our loan based on our senior secured lien position in the company. So this was a way to kind of consolidate the assets.

當然。因此，Evelo 作為一家生命科學公司，擁有大量生命科學資產，他們正在尋求將其貨幣化。所以他們將所有這些資產放入一家控股公司。目前有多項交易正在進行中。其中一起交易確實在第三季完成。所有來自這些交易的收益，有些是合約收益，是隨著時間的推移歸屬於 Evelo 的。這些資金將流向 Horizo​​n，根據我們在公司的優先擔保留置權繼續償還貸款。所以這是一種整合資產的方法。

Like I said, there's -- it was one transaction that closed in Q3. There's another one, a very similar transaction, that is expected to close in Q4. And then there's a separate asset where we're also in the process of finalizing documentation for a Q4 closing. And we'll get a combination of some upfront proceeds, contractual proceeds due -- specifically, when I say us, Evelo will get them, those will flow to us through the transactions.

就像我說的，這是第三季完成的一筆交易。還有另外一項非常相似的交易，預計將於第四季完成。然後還有一個單獨的資產，我們也正在為第四季的收尾工作敲定文件。我們將獲得一些預付收益和合約應得收益的組合 - 具體來說，當我說我們時，Evelo 將獲得它們，這些收益將透過交易流向我們。

And then some of them, in addition to contractual obligations, Evelo has significant equity positions in the transactions that are being completed. So a lot -- they have a very diverse asset base. So we're trying to do everything we can to maximize the value of those assets.

除了合約義務之外，Evelo 還在正在完成的交易中擁有大量股權。他們的資產基礎非常多元化。因此，我們正在盡一切努力來最大化這些資產的價值。

(Operator Instructions)

（操作員指令）

Bryce Rowe, B. Riley Securities.

布萊斯·羅 (Bryce Rowe)，B. Riley Securities。

Wanted to maybe start with the environment. I think last quarter, you all talked about kind of an improving pipeline and an improving backdrop from a market perspective, and certainly, looks like that came to fruition in the third quarter.

也許想從環境開始。我認為上個季度大家都在談論從市場角度來看通路和背景的改善，當然，看起來這在第三季已經實現。

And based on -- Dan, based on your comments, it sounds like that's kind of continued into October. So trying to maybe handicap the deal flow over coming months, and if you could talk a little bit more about the pipeline and how it's building.

並且基於——丹，根據你的評論，聽起來這種情況會持續到十月。因此，也許可以嘗試在未來幾個月內阻礙交易流程，如果您可以更多地談論管道及其建設情況的話。

It sounds -- again, it sounds like you've got some tangible deals that have already closed here in the fourth quarter, and so wanted to just get a feel for beyond October, how the market's shaping up and how your pipeline is coming together.

聽起來——再說一次，聽起來您已經在第四季度完成了一些有形交易，因此想了解一下十月以後的市場狀況以及您的通路整合。

Sure, Bryce. Yes, the market, we believe, is improving. We've been signaling that on our last several calls. That was our expectation based upon signs that we saw in terms of portfolio companies, resetting valuations, getting significant rounds of equity, and more recently, some early signs of life in the exit window. I think it's still too early to say that it's consistent and predictable, but there's certainly some activity, as you saw with Ceribell and some others.

當然，布萊斯。是的，我們相信市場正在改善。我們在最近幾次通話中已經表達過這一點。這是我們根據投資組合公司、重置估值、獲得大量股權以及最近退出窗口的一些早期生命跡象所做出的預期。我認為現在說它是一致的和可預測的還為時過早，但肯定存在一些活動，就像你在 Ceribell 和其他一些公司看到的那樣。

So I do think the market is improving, and we believe that we're in for some strong vintages here in '24 and '25, but we're not there yet. You're right, we did get -- we are building the pipeline with those quality opportunities, recently raised equity, strong performers. We had had some awards in October. I want to clarify those awards that I referenced on -- in my scripted remarks haven't closed yet. We're working through the process on those. All of them can and should fund in Q4, but you -- some might be delayed or some might all fall off.

因此，我確實認為市場正在改善，我們相信，2024年和2025年我們將迎來一些強勁的年份，但我們還沒有達到那一步。你說得對，我們確實得到了——我們正在利用這些優質機會、最近籌集的股權和強勁的表現者來建立管道。我們在十月已經獲得一些獎項。我想澄清一下，我在腳本演講中提到的那些獎項還沒結束。我們正在努力解決這些問題。他們都可以而且都應該在第四季度獲得資金，但有些可能會被推遲，或者有些可能會全部失敗。

We do expect Q4 to be a growth quarter. But beyond that level of guidance, I don't have a good feel at this stage for what those numbers would be. But the pipeline is growing. It's at its strongest position that it's been in, in a while, and we are competing hard for quality opportunities.

我們確實預計第四季度將是一個成長的季度。但除了該指導水平之外，我現階段還不清楚這些數字會是多少。但管道正在不斷成長。它目前正處於最強的地位，我們正在努力競爭優質的機會。

Okay. That's helpful. And so as we kind of think about that outlook, even though it's a bit murky, so to speak, how do you all think about the balance sheet at this point? I mean you've had a decent level of cash going -- on the balance sheet going on the last year, really. Do you expect to draw that down?

好的。這很有幫助。因此，當我們思考這種前景時，儘管可以說它有點模糊，但你們現在如何看待資產負債表？我的意思是，從去年的資產負債表來看，你的現金水準確實相當高。您期望將其降低嗎？

And I'm kind of thinking about that in relation to where NII is relative to the dividend and kind of couple that with the fact that you haven't earned the incentive fee or haven't had an incentive expense for the last couple of quarters, how do you think about putting that cash to work and possibly getting back to a point where you are covering the dividend?

我正在考慮 NII 與股息的關係，再加上你沒有賺到激勵費用，或者在過去幾個季度沒有激勵費用，你如何考慮使用這些現金，並可能回到你可以支付股息的水平？

Yes. So I think I mentioned, every quarter, when we go into the quarter, we look at the committed backlog, what we expect the funds, where we think awards will come in during the quarter and what we'll be able to fund from that and look to our capital sources, right, use the cash on the balance sheet, as you mentioned, look at the debt facilities and look at our ability to raise equity. And we try to plan that as best as possible in the most efficient way. At times, deals will slip, we'll have late prepayments. And so the cash will fluctuate from quarter-to-quarter. It's always just a snapshot that we're reporting. So that's how we think about the balance sheet.

是的。所以我想我提到過，每個季度，當我們進入該季度時，我們都會查看已承諾的積壓訂單，我們預期的資金是多少，我們認為該季度的獎勵將來自哪里以及我們能夠從中獲得什麼資金，並查看我們的資金來源，對，使用資產負債表上的現金，正如你提到的那樣，查看債務融資並查看我們籌集股本的能力。我們會盡力以最有效的方式做出最佳規劃。有時，交易會出現失誤，我們就會延遲預付款。因此現金每季都會發生波動。我們所報道的始終只是一個快照。這就是我們對資產負債表的看法。

As far as the NII, I would just reiterate that the venture debt portfolio does generate prepayments on an annual basis. Where they come in on a quarterly basis will fluctuate, and so quarter-over-quarter will be at different levels. But if you look back historically, we've been able to cover our distribution for the past six years, and we're on a good trend to the first nine months of this year to do that again. And I think I may have forgotten your other question, but -- .

就國家資訊基礎架構而言，我只想重申，風險債務組合確實每年都會產生預付款。他們每季的收入水準都會波動，因此季度環比的成長水準會有所不同。但如果回顧歷史，過去六年我們一直能夠涵蓋我們的分銷，而今年前九個月我們又將保持這一良好趨勢。我想我可能忘記了你的另一個問題，但是--。

No, I think that covered it, Dan. I appreciate it. I did have one more just around, I guess, one of the non-accruals that's still sitting on non-accrual. Maybe Dan or Jerry, you could address this, but it looked like Swift was the fair value mark improved dramatically here in the quarter. Can you just talk about what pushed that up? And assuming that, that maybe is on a path back to accrual status.

不，我想這就夠了，丹。我很感激。我想，我確實還有另一個，其中一個未提列項目仍處於未提列狀態。也許丹或傑瑞可以解決這個問題，但看起來 Swift 的公允價值標記在本季大幅提高。您能談談是什麼促成了這一點嗎？並且假設，這也許是一條回到應計狀態的路。

Sure. Swift is a company that's been in our portfolio for a couple of years, very strong product, very strong investors, a victim of the market environment earlier this year where there were issues with continuing fundraising. So the company has been operational all along, even though it was on nonaccrual, it was having some precarious cash position. So we put it on nonaccrual while we were working through that.

當然。Swift 是我們投資組合中的一家公司，已有幾年了，產品非常強大，投資者非常強大，但今年早些時候，由於持續融資出現問題，該公司成為了市場環境的受害者。因此，儘管該公司處於非應計狀態，但一直在運營，其現金狀況也不穩定。因此，我們在處理這一問題時，將其設為非應計。

We are working with two very high-quality life science investors to bring in capital to this company. We've been -- we brought -- the capital has come in during the third quarter. We are in the process of closing a longer-term transaction that will stabilize this company and set it up for long-term performance.

我們正在與兩家非常優質的生命科學投資者合作，為這家公司引入資金。我們已經——我們已經——在第三季獲得了資本。我們正在進行一項長期交易，這將使該公司穩定下來，為長期經營做好準備。

Okay. And I assume there's some -- the potential for accrued interest that, I guess, hasn't been paid that could come back in if it does come back to accrual status? Is that the right way to think about it?

好的。我認為，如果確實恢復到應計狀態，那麼可能存在一些尚未支付的應計利息，這些利息可能會再次返還？這是正確的思考方式嗎？

So we're working on a variety of strategies, and the accrued interest and the final payments and the balances are all part of the picture. But yes, that will be part of the solution.

所以我們正在製定各種策略，應計利息、最終付款和餘額都是其中的一部分。但確實，這將是解決方案的一部分。

Christopher Nolan, Ladenburg Thalmann.

克里斯多福諾蘭，拉登堡塔爾曼。

The ATM, you guys have been hitting it pretty hard the last few quarters. What dictates the pace of shares sold?

ATM，你們在過去幾季的衝擊相當大。什麼決定了股票出售的速度？

So again, yes, when we look at our capital sources each quarter, we try to balance that out in comparison to what we believe we'll fund in the quarter. You always can't match it perfectly. But with the volume that's trading in the ATM, with our debt facilities' capacity and other availabilities, that will dictate how much we determine we want to raise through the ATM.

所以，是的，當我們每季查看我們的資金來源時，我們會嘗試將其與我們認為該季度將提供的資金進行平衡。你總是無法完美匹配。但是，ATM 的交易量、我們的債務融資能力和其他可用性將決定我們想透過 ATM 籌集多少資金。

And so I guess -- and I missed the early part of the call. I just had overlapping calls. It seems like the market is becoming stronger for you guys. And so going forward, should we expect more share issuances from the ATM given your indications of improving loan demand?

所以我想——我錯過了通話的早期部分。我剛剛接到了重疊的電話。看起來市場對你們來說正在變得更強大。那麼展望未來，鑑於您所說的貸款需求有所改善的跡象，我們是否應該期待 ATM 發行更多股票？

I think, again, that will fluctuate. What we have been doing this past year is probably a good barometer to think about going forward.

我認為這又會波動。我們過去一年的所作所為或許可以作為我們思考未來的一個很好的晴雨表。

Okay. And I guess the final question is, your stock price has sort of come down off highs earlier in the year. You guys have any plan or strategy in terms of trying to improve that, please?

好的。我想最後一個問題是，你們的股價已經從今年稍早的高點回落了。你們有什麼計劃或策略來改善這種情況嗎？

We always look at stock price, talk about stock price. There are different things that people have opinions that you can do to affect the stock price. We're really more focused on delivering performance for our shareholders, growing the portfolio, generating a consistent NII, and we believe that will take care of the stock price.

我們總是看股票價格、談論股票價格。人們對於採取一些措施來影響股價持有不同的看法。我們真正關注的是為股東提供業績，擴大投資組合，產生穩定的國家資訊收入，我們相信這將會影響股價。

Great. Final question, any consideration of doing off-balance sheet vehicles or RIAs or anything like that?

偉大的。最後一個問題，有沒有考慮過開展表外業務或 RIA 或類似業務？

We do look at that consistently, and it's one we will continue to look at going forward. As of right now, we don't have anything in the plans.

我們確實一直在關注這個問題，而且我們也將繼續關注這個問題。截至目前，我們還沒有任何計劃。

Paul Johnson, KBW.

保羅·約翰遜，KBW。

Just going back to Bryce's question a little bit on just NII generation and covering the distribution. So when you say your goal is to cover the distribution with NII or when you're kind of looking forward with your outlook, does that include the accrual of the incentive fee -- the full accrual of the incentive fee? Just want to be clear on that.

稍微回顧一下 Bryce 的問題，關於 NII 的生成與分佈。所以，當您說您的目標是用 NII 覆蓋分配，或者當您對前景有所展望時，這是否包括激勵費用的應計 - 激勵費用的全部應計？只是想弄清楚這一點。

Yes. So when we do forecast that out, we take everything in consideration, cost of capital, our yield, the growth in the balance sheet and earning back the incentive fee over a period of time where we think we'll get back to that towards the end of next year at full amount.

是的。因此，當我們進行預測時，我們會考慮所有因素，包括資本成本、收益、資產負債表的增長以及在一段時間內賺回激勵費，我們認為我們將在明年年底恢復全額。

Got it. Okay. So the end of next year is -- you're kind of looking at potentially getting back to the full accrual rate?

知道了。好的。那麼到明年年底—您是否有可能恢復到全額應計率？

To the full amount, yes. We think we'll gradually start building back or the adviser would start earning the incentive fee gradually over the next few quarters to probably about 100% towards the end of next year.

是的，全額。我們認為，我們將逐步開始恢復，或者顧問將在接下來的幾個季度內逐步開始賺取激勵費，到明年年底將達到 100％ 左右。

Got it. And then on the spillover income, I think it was $1.27 you said. I mean, what would you like that to be at, I guess, kind of at a minimum? Do you have any sort of target for where you would like to kind of carry spillover income at?

知道了。然後關於溢出收入，我認為您說的是 1.27 美元。我的意思是，你希望這至少是什麼？您對溢出收入的預期目標是什麼？

We don't look at it as a target. We look at what contractually we can carry forward. We look at ways to be able to distribute that out to the shareholders through supplemental distributions and try to manage it through those two.

我們並不視其為目標。我們研究一下合約中哪些內容是可以延續的。我們正在研究透過補充分配將其分配給股東的方法，並嘗試透過這兩種方式進行管理。

Got you. And then I mean, just kind of given the higher level of the realized losses taken this quarter, I realize some of it may have to do with the restructuring of investments, which might get more complicated. But I guess it's a little surprising to see the level of realized losses again this quarter, and the spillover did not really change much quarter-over-quarter. So is there anything, I guess, flowing through those investments as they're resolved that would affect spillover level kind of to your estimation?

明白了。然後我的意思是，考慮到本季度已實現損失的較高水平，我意識到其中一些可能與投資重組有關，這可能會變得更加複雜。但我想，本季再次看到實際損失的水平有點令人驚訝，而且溢出效應實際上與上一季相比並沒有太大變化。那麼，我猜，在這些投資得到解決後，是否會有什麼影響溢出水平，這根據您的估計？

Yes. So the large realized loss for the quarter was generated from the completion of the Nexii transaction Dan mentioned. And that really just flipped from an unrealized loss to a realized loss, where it had very little impact on NAV quarter-over-quarter. Net realized, unrealized was about $4 million down for the quarter. Then the spillover is impacted by the operating income, NII compared to the distribution.

是的。因此，本季的巨額已實現虧損是由於丹提到的 Nexii 交易的完成而產生的。這實際上只是從未實現損失轉變為已實現損失，對季度淨資產價值 (NAV) 的影響很小。本季淨實現未實現利潤下降約 400 萬美元。然後，與分配相比，外溢效應會受到營業收入、NII 的影響。

And last question for me, I guess, yields on new investments. It sounds like you're expecting a decent amount growth going into the fourth quarter. There's a good amount of activity this quarter. Where are you guys seeing, I guess, yields -- core yields, coupon rate yields on new investments? Have you seen any kind of compression in spreads there?

我想，我的最後一個問題是，新投資的收益。聽起來你預計第四季將出現相當可觀的成長。本季的活動非常豐富。我想，你們看到的報酬率──核心報酬率、新投資的票面利率報酬率是多少？您是否發現那裡的利差出現任何形式的壓縮？

So haven't seen a compression in spreads necessarily on a portfolio basis. Certainly, each transaction merits its own pricing consideration and structural consideration. But across the portfolio, yields have been -- have maintained pretty nicely. Obviously, the 50 basis points cut in index rates earlier is affecting overall yields.

因此，從投資組合的角度來看，利差未必會有所壓縮。當然，每筆交易都值得自己的定價考慮和結構考慮。但整個投資組合的收益率一直保持相當好。顯然，先前指數利率下調50個基點正在影響整體收益率。

But over time, we expect the venture market to trade in the yields that we've traditionally seen. And so far, that's been the case, and we expect that to continue yields across the -- on a portfolio basis. I think our portfolio yield year-over-year for many years has been quite strong, and I think that's going to remain a strength of ours.

但隨著時間的推移，我們預計創投市場將實現我們傳統上看到的收益率。到目前為止，情況確實如此，我們預計整個投資組合的收益率將繼續保持在這種水平。我認為我們投資組合的收益率多年來一直相當強勁，而且我認為這將繼續是我們的優勢。

There are no further questions. I would like to now turn the floor back to Robert Pomeroy, Chairman and CEO, for closing remarks.

沒有其它問題了。現在，我想請董事長兼執行長 Robert Pomeroy 致最後總結。

Thank you all for joining us this morning. We appreciate your continued interest and support in Horizon, and we look forward to speaking with you again soon. This will conclude our call.

感謝大家今天早上參加我們的活動。我們感謝您對 Horizo​​n 的持續關注和支持，我們期待很快再次與您交談。我們的通話到此結束。

Thank you. This does conclude today's teleconference. We thank you for your participation. You may disconnect your lines at this time.

謝謝。今天的電話會議到此結束。我們感謝您的參與。現在您可以斷開您的線路。