Rand Capital Corporation · NASDAQ:RAND
Rand Capital — Q4 2023 Earnings Presentation
17 slides from Rand Capital's earnings presentation, Mar 5, 2024
Slide 1: Fourth Quarter and Full Year 2023 Financial Results
FOURTH QUARTER AND FULL YEAR 2023 FINANCIAL RESULTS March 5, 2024 Daniel P. Penberthy President & CEO Margaret W. Brechtel EVP & CFO © 2023 Rand Capital Corporation Nasdaq: RAND
Slide 2: Forward Looking Statements
FORWARD LOOKING STATEMENTS This presentation contains “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. All statements, other than historical facts, including but not limited t
Slide 3: Strong Execution
STRONG EXECUTION (Results compared with the prior-year period unless otherwise noted) ✓ Portfolio expansion centered on debt investments drove income growth • Q4 total investment income increased 11% to $1.9 million over the prior-year period • Full year 2023 total investment income grew 27% to $7.3
Slide 4: Delivering Cash Dividends
DELIVERING CASH DIVIDENDS (Results compared with the prior-year period unless otherwise noted) ✓ Paid Q4 2023 dividends of $0.63 per share • Consisting of regular quarterly dividend of $0.25 Dividends Paid per Share per share and a special dividend of $0.38 per share ✓ During 2023, paid total divide
Slide 5: Portfolio Mix
PORTFOLIO MIX Fair Value Portfolio Mix ($ in millions) $77.1 Fair value increase reflects new and follow-on investments, and $61.5 $7.3 valuation adjustments on several portfolio companies $6.4 $20.5 $20.9 $49.3 Mix at quarter-end, based on fair value: $34.2 64% Fixed-rate debt investments 2022 2023
Slide 6: Portfolio Activity
PORTFOLIO ACTIVITY Q4 2023 Investments Provides design, distribution and Offers a wide range of high-quality, installation services for commercial affordable pet products kitchens, renovations and new builds Funded follow-on debt investment of Funded follow-on equity investment of $2.2 million $73,0
Slide 7: Diversified Portfolio
DIVERSIFIED PORTFOLIO Investments by Industry Classification December 31, 2023 December 31, 2022 Automotive Public BDC 4% Stocks 5% Public BDC Stocks Distribution Software 6% 6% 10% Professional Services Software 8% Professional Services Automotive 31% 42% 13% Consumer Products 13% Consumer Products
Slide 8: Top Five Portfolio Investments
TOP FIVE PORTFOLIO INVESTMENTS Investments at Year % of Total Company Industry Investment Type ($ in millions) Fair Value Acquired Portfolio Professional Services – Cellular Equity – Tilson $10.6 2015 info systems, construction, 14% mgmt. paying dividend Professional Services – Term note Food Servic
Slide 9: Financial Review
FINANCIAL REVIEW © 2023 Rand Capital Corporation Nasdaq: RAND
Slide 10: Fourth Quarter Financial Summary
FOURTH QUARTER FINANCIAL SUMMARY ($ in thousands, except per share data) Q4 2023 Q4 2022 Total investment income $ 1,930 $ 1,733 Total investment income grew 11% • Driven by a 47% increase in interest from portfolio Total expenses 1,014 371 companies Net investment income¹ 962 1,230 Total expenses i
Slide 11: Full Year Financial Summary
FULL YEAR FINANCIAL SUMMARY ($ in thousands, except per share data) 2023 2022 Total investment income $ 7,338 $ 5,765 Total investment income grew 27% • Reflects 44% increase in interest from portfolio Total expenses 4,178 1,119 companies Net investment income¹ 2,968 4,430 Total expenses increase re
Slide 12: 2023 Net Asset Value Change
2023 NET ASSET VALUE CHANGE ($ in thousands) $2,868 ($3,433) $2,968 $691 $60,815 $57,721 Net assets at Net investment Net realized gain on Net change in Cash dividend Net assets at 12/31/2022 income sales and dispositions unrealized 12/31/2023 $57,721,320 of investments appreciation on $60,815,213 i
Slide 13: Strong and Flexible Balance Sheet
STRONG AND FLEXIBLE BALANCE SHEET Net Asset Value Composition At December 31, 2023 Publicly-traded equity securities of $7.4 million Per Share Assets and Liabilities available for future liquidity opportunities $1.28 $3.3 million consolidated cash At December 31, 2023, $16.3 million in outstanding b
Slide 14: 2024 Objectives
2024 OBJECTIVES ✓ Continue to replicate our past success by increasing our portfolio composition with new debt investments ✓ Continue to evaluate current portfolio company equity holdings and M&A market conditions to further drive portfolio equity returns ✓ Put capital to work: • Leverage cash balan
Slide 15: Supplemental Information
SUPPLEMENTAL INFORMATION © 2023 Rand Capital Corporation Nasdaq: RAND
Slide 16: Adjusted Expenses (Non-GAAP)
ADJUSTED EXPENSES (N -GAAP*) ON Three months Three months Year Year ended ended ended ended December 31, December 31, December 31, December 31, 2023 2022 2023 2022 Total expenses $ 1,013,797 $ 371,090 $ 4,178,319 $ 1,119,229 Exclude expenses/(credits) for capital gains incentive fees 64,000 (168,000
Slide 17: Adjusted Net Investment Income Per Share (Non-GAAP)
ADJUSTED NET INVESTMENT INCOME PER SHARE (N -GAAP*) ON Three months Three months Year Year ended ended ended ended December 31, December 31, December 31, December 31, 2023 2022 2023 2022 Net investment income per share $ 0.37 $ 0.48 $ 1.15 $ 1.72 Exclude expenses/(credits) for capital gains incentiv