Oxford Lane Capital Corp (OXLC) 2024 Q4 法說會逐字稿

Good afternoon, ladies and gentlemen. Thank you for joining today's Oxford Lane Capital Corp, fourth fiscal quarter 2024 earnings call. My name is [Pierre], and I will be your moderator for today's call. All lines will be muted during the presentation portion of the call with an opportunity for questions and answers at the end. If you would like to ask a question, please press star one on your telephone keypad. I would now like to pass the call over to your host, Saul Rosenthal. Please proceed.

女士們、先生們，午安。感謝您參加今天的 Oxford Lane Capital Corp 2024 年第四財季財報電話會議。我的名字是[皮埃爾]，我將擔任今天電話會議的主持人。在通話的演示部分，所有線路將被靜音，最後有機會提問和回答。如果您想提問，請按電話鍵盤上的星號一。現在我想將電話轉接給主持人索爾·羅森塔爾 (Saul Rosenthal)。請繼續。

Thank you, [Julia], and hello, everyone, and welcome to the Oxford Lane Capital Corp, fourth fiscal quarter 2024 earnings call. I'm joined today by Bruce Rubin, our Chief Financial Officer; and Brian Aleksa, Senior Member of our CLO Investment Team; Jonathan Cohen, our CEO is traveling today. Bruce, would you please open our call with a disclosure regarding forward looking statements.

謝謝你，[茱莉亞]，大家好，歡迎參加 Oxford Lane Capital Corp 2024 年第四財季財報電話會議。今天我們的財務長 Bruce Rubin 也加入了我的行列。以及我們 CLO 投資團隊的高級成員 Brian Aleksa；我們的執行長喬納森·科恩 (Jonathan Cohen) 今天出差。布魯斯，請您在我們的電話會議開始時披露有關前瞻性陳述的資訊。

Sure, sir. Today's conference call is being recorded and audio replay of the call will be available for 30 days. Replay information is included in our press release that was issued earlier this afternoon. Please note that this call is the property of Oxford Lane Capital Corp. Any unauthorized rebroadcast of this call in any form is strictly prohibited.

當然，先生。今天的電話會議正在錄音，電話會議的音訊重播將在 30 天內提供。重播資訊包含在我們今天下午早些時候發布的新聞稿中。請注意，本次電話會議屬於 Oxford Lane Capital Corp. 的財產。

At this point, I direct your attention to the customary disclosure in the press release regarding forward-looking information. Today's conference call includes forward-looking statements and projections that reflect the company's current views with respect to, among other things, future events and financial performance we ask that you refer to our most recent filings with the SEC for important factors that could cause actual results to differ materially from those indicated in these projections do not undertake to update our forward-looking statements unless required to do so by law.

此時，我請您注意新聞稿中有關前瞻性資訊的慣例披露。今天的電話會議包括前瞻性陳述和預測，反映了公司目前對未來事件和財務業績等的看法，我們要求您參考我們最近向 SEC 提交的文件，了解可能導致實際結果的重要因素與這些預測中指出在的內容有重大差異的情況下，我們不承諾更新我們的前瞻性陳述，除非法律要求這樣做。

During this call, we'll use terms defined in the earnings release and also refer to non-GAAP measures for definitions and reconciliations to GAAP. Please refer to our earnings release posted on our website at www.oxfordlanecapital.com. With that, I'll turn the presentation back over to Saul.

在本次電話會議中，我們將使用收益發布中定義的術語，並參考非 GAAP 衡量標準進行定義和與 GAAP 的調整。請參閱我們網站 www.oxfordlanecapital.com 上發布的收益報告。這樣，我會將簡報轉回索爾。

Thank you, Bruce. On March 31, 2024, our net asset value per share stood at $4.90 compared to a net asset value per share of $4.82 at the previous quarter. For the quarter ended March 31, we recorded GAAP total investment income of approximately $82.6 million, representing an increase of approximately $3.4 million from the prior quarter.

謝謝你，布魯斯。截至 2024 年 3 月 31 日，我們的每股淨值為 4.90 美元，而上一季的每股資產淨值為 4.82 美元。截至 3 月 31 日的季度，我們記錄的 GAAP 總投資收入約為 8,260 萬美元，較上一季增加約 340 萬美元。

Quarter's GAAP total investment income consisted of approximately $76.3 million from our CLO equity and CLO warehouse investments and approximately $6.3 million from our CLO debt investments and other income partial lien recorded GAAP net investment income of approximately $51 million or $0.22 per share for the quarter ended March 31, compared to approximately $48.7 million or $0.23 per share for the quarter ended December 31.

本季的GAAP 總投資收入包括來自我們的CLO 股權和CLO 倉庫投資的約7630 萬美元，以及來自我們的CLO 債務投資和其他收入的約630 萬美元，部分留置權記錄的截至3 月份的季度的GAAP 淨投資收入約為5,100 萬美元或每股0.22 美元12 月 31 日結束的季度約為 4,870 萬美元，即每股 0.23 美元。

Our core net investment income was approximately $79.9 million for the quarter, or $0.35 per share, compared with approximately $82.7 million or $0.39 per share for the quarter ended December 31 quarter ended March 31, we recorded net unrealized depreciation on investments of approximately $17.7 million and net realized losses of approximately $1.2 million.

我們本季的核心淨投資收入約為7,990 萬美元，即每股0.35 美元，而截至12 月31 日的季度約為8,270 萬美元，即每股0.39 美元，截至3 月31 日的季度，我們記錄的投資未實現淨折舊約為1,770 萬美元，已實現淨損失約 120 萬美元。

We had a net increase in net assets resulting from operations of approximately $67.5 million, or $0.30 per share for the fourth fiscal quarter as of March 31, the following metrics applied, and we note that none of these metrics represents a total return to shareholders.

截至 3 月 31 日的第四財季，我們的營運淨資產淨增加約 6,750 萬美元，即每股 0.30 美元，採用以下指標，我們注意到這些指標均不代表股東的總回報。

The weighted average yield of our CLO debt investments at current cost was 17.1%, up from 16.6% as of December 31. The weighted average effective yield of our CLO equity investments at current cost was 16.9%, up from 16.5% as of December 31.

以當前成本計算，我們的 CLO 債務投資的加權平均收益率為 17.1%，高於截至 12 月 31 日的 16.6%。以目前成本計算，我們的 CLO 股權投資的加權平均有效收益率為 16.9%，高於截至 12 月 31 日的 16.5%。

The weighted average cash distribution yield of our CLO equity investments at current cost was 23.5%, down from 24% as of December 31. And we note that the cash distribution yields calculated on our CLO CLO equity investments are based on the cash distributions we received or which we were entitled to receive at each respective period end.

以現值計算，我們的 CLO 股權投資的加權平均現金分配收益率為 23.5%，低於截至 12 月 31 日的 24%。我們注意到，根據我們的 CLO CLO 股權投資計算的現金分配收益率是基於我們收到的或我們有權在每個期末收到的現金分配。

During the quarter ended March 31, we issued a total of approximately 18.6 million shares of our common stock pursuant to an at-the-market offering, resulting in net proceeds of approximately $94.7 million during the quarter ended March 31, we made additional CLO investments of approximately $225.2 million, and we received approximately $19 million from sales and repayments.

在截至 3 月 31 日的季度中，我們根據市場發行總共發行了約 1860 萬股普通股，在截至 3 月 31 日的季度中淨收益約為 9470 萬美元，我們進行了額外的 CLO 投資約2.252億美元，我們從銷售和還款中收到約1,900 萬美元。

Today our Board of Directors declared a 12.5% increase in monthly common stock distributions to $0.09 per share for each of the months ending July, August and September 2024 with that, I'll turn the call over to Brian Alexis, senior member of our investment team.

今天，我們的董事會宣布，截至 2024 年 7 月、8 月和 9 月的每月普通股分配將增加 12.5%，達到每股 0.09 美元，我將把電話轉給我們投資的高級成員 Brian Alexis團隊。

Thank you, Saul.

謝謝你，索爾。

During the quarter ended March 31, 2024 US loan market performance improved versus prior quarter. US loan prices as defined by the [morningstar] LSTA US Leveraged Loan Index increased from 96.23% as of December 31, 2023 to 96.73% as of March 31. The increase in US loan prices led to an approximate five point increase in median US CLO equity net asset values. Additionally, we observed median weighted average spreads across loan pools within CLO portfolios decreased to 368 basis points compared to 372 basis points last quarter.

截至 2024 年 3 月 31 日的季度，美國貸款市場表現較上一季有所改善。[morningstar] LSTA 美國槓桿貸款指數定義的美國貸款價格從截至 2023 年 12 月 31 日的 96.23% 上升至截至 3 月 31 日的 96.73%。美國貸款價格上漲導緻美國 CLO 股權淨資產中位數增加約 5 個百分點。此外，我們觀察到 CLO 投資組合內貸款池的加權平均利差中位數下降至 368 個基點，而上季為 372 個基點。

The 12-month trailing default rate for the loan index decreased to 1.1% by principal amount at the end of the quarter from 1.5% at the end of December 2023. We note that out-of-court restructurings, exchanges and subpar buybacks, which are not captured in the cited default rate remain elevated. Additionally, the distress ratio, defined as a percentage of loans with a price below 80% of par ended the quarter at 3.5% compared to approximately 4.5% at the end of December 2023. CLO new issuance during the quarter totaled approximately $49 billion, an increase of $17 billion from the prior quarter, setting the pace nearly 45% ahead of last year's issuance as CLO liabilities continued to tighten throughout the quarter.

以本金計算，貸款指數 12 個月追蹤違約率從 2023 年 12 月底的 1.5% 降至本季末的 1.1%。我們注意到，未包含在上述違約率中的庭外重組、交換和低於標準的回購仍處於較高水準。此外，不良率（定義為價格低於面值 80% 的貸款百分比）在本季結束時為 3.5%，而 2023 年 12 月底約為 4.5%。本季 CLO 新發行總額約 490 億美元，較上季增加 170 億美元，較去年發行速度快了近 45%，因整個季度 CLO 負債持續收緊。

Oxford Lane continued to be active this quarter, trading over [300 million] notional of CLO equity and junior debt in the secondary market and adding three new issue CLO equity investments in the primary market as a function of our overall activity in both markets.

Oxford Lane 本季繼續活躍，在二級市場上交易了超過[3 億] 的名義CLO 股權和次級債務，並根據我們在兩個市場的整體活動，在一級市場上增加了三項新發行的CLO 股權投資。

This quarter, we were able to lengthen the weighted the weighted average reinvestment period at Oxford Lane's CLO equity portfolio from April 2026 to July 2026. Our investment strategy during the quarter was to engage in relative value trading and to lengthen the weighted average reinvestment period of Oxford Lane's CLO equity portfolio.

本季度，我們將 Oxford Lane 的 CLO 股票投資組合的加權平均再投資期間從 2026 年 4 月延長至 2026 年 7 月。我們本季的投資策略是進行相對價值交易並延長Oxford Lane CLO 股票投資組合的加權平均再投資期間。

In the current market environment, we intend to continue to utilize an opportunistic and unconstrained CLO investment strategy across US, CLO equity debt and warehouses. As we look to maximize our long-term total return and as a permanent capital vehicle we have historically been able to take a longer-term view towards our investment strategy.

在當前的市場環境下，我們打算繼續在美國、CLO股權債務和倉庫上採用機會主義和不受約束的CLO投資策略。當我們尋求最大化長期總回報並作為永久資本工具時，我們歷來能夠以更長遠的眼光來製定我們的投資策略。

With that, I will turn the call back over to Saul.

這樣，我會將電話轉回給索爾。

Thank you, Brian, and additional information about Oxford Lane's fourth quarter performance has been uploaded to our website at www.oxfordlanecapital.com. And with that, operator, we will now take questions.

謝謝布萊恩，有關 Oxford Lane 第四季度業績的更多資訊已上傳到我們的網站 www.oxfordlanecapital.com。接線員，我們現在開始提問。

We will now begin the Q&A session. (Operator Instructions)

我們現在開始問答環節。（操作員說明）

Mickey Schleien, Ladenburg.

米基‧施萊恩，拉登堡。

Yes, good afternoon, everyone. A couple of questions from me. With the tightening of CLO liabilities we've seen this year. How does the economics look now in the primary market versus the secondary market and the opportunities for you to refinance and reset and grow takes positions which are beyond the reinvestment period into new positions?

是的，大家下午好。我有幾個問題。隨著今年我們看到的 CLO 負債收緊。現在一級市場與二級市場的經濟狀況如何，以及您再融資、重置和成長的機會，將超出再投資期的部位轉變為新部位？

Sure, Mickey. Yes, very, very good question, and Brian will address it.

當然，米奇。是的，非常非常好的問題，布萊恩會解決這個問題。

Yes, sir, Mickey, as you noted, it has been a good opportunity to take advantage of the tight liabilities, especially where refis and resets are concerned. As far as the primary market is concerned, it is kind of a push and pull between tightening liabilities and rising asset prices. And the rising asset prices make the primary market slightly more challenging while tightening liabilities.

是的，米基先生，正如您所指出的，這是利用緊縮負債的好機會，特別是在重新融資和重置方面。就一級市場而言，這是一種負債緊縮和資產價格上漲之間的推拉關係。而資產價格的上漲，在負債收緊的同時，也讓一級市場的挑戰略有增加。

Obviously, make it easier to get deals done. And so that that push and pull is something we monitor every day. But as you stated, we have taken advantage of the tightened liabilities to restructure some of our refinance and reset some of the grocery investment deals, especially.

顯然，讓交易變得更容易完成。因此，這種推拉是我們每天監控的事情。但正如您所說，我們利用負債收緊的機會重組了部分再融資，尤其是重置了一些雜貨投資交易。

Okay. Understand. Obviously, you've had a chance to review the results for the quarter or the investor presentation. But looking at the deck from the last quarter, I counted about a dozen positions which were still in their reinvestment period and where the triple-A spread was meaningfully above sort of 150 basis points, which I think is what the market is now I want to ask if that sounds about right to you and how would you describe the potential impact on Oxford of refinancing or resetting those positions?

好的。理解。顯然，您有機會查看本季的業績或投資者簡報。但從上個季度的表現來看，我數了數大約有十幾個仍處於再投資期的頭寸，其中 3A 利差明顯高於 150 個基點，我認為這就是我現在想要的市場詢問這對您來說是否合適，以及您如何描述再融資或重置這些職位對牛津大學的潛在影響？

Yes, Mickey, in positions where we hold majority on those, those liabilities are something we are very carefully monitoring I can't speak to any individual positions, but we are actively monitoring all of those positions for [moneyness]. As far as [refine] and reset opportunities go, I mean, we've been in an active dialogue with all of our CLO managers as well as various dealers to look at resetting and refine those liabilities where possible.

是的，米奇，在我們持有多數股權的職位上，我們正​​在非常仔細地監控這些負債，我無法談論任何個別職位，但我們正在積極監控所有這些職位[金錢]。就[細化]和重置機會而言，我的意思是，我們一直在與所有 CLO 經理以及各個經銷商進行積極對話，以考慮在可能的情況下重置和細化這些負債。

Okay. I appreciate that. Those are all my questions this afternoon. Thank you for your time.

好的。我很感激。這些就是我今天下午的所有問題。感謝您的時間。

Thank you, Mickey.

謝謝你，米奇。

Thank you. There are no additional questions at this time. I will pass the call back to Saul Rosenthal.

謝謝。目前沒有其他問題。我會將電話轉回索爾·羅森塔爾。

Thank you, everyone, for joining today's call and listening to our fourth fiscal quarter results. And we look forward to speaking to you again soon.

感謝大家參加今天的電話會議並聆聽我們第四財季的業績。我們期待很快再次與您交談。

Thank you.

謝謝。

That concludes today's conference call. Thank you, you may now disconnect your lines.

今天的電話會議到此結束。謝謝，您現在可以斷開線路了。