Great Elm Capital Corp. · NASDAQ:GECC
Great Elm Capital — Q1 2025 Earnings Presentation
32 slides from Great Elm Capital's earnings presentation, May 6, 2025
Slide 1: Investor Presentation
Investor Presentation Quarter Ended March 31, 2025 May 6, 2025 NASDAQ: GECC
Slide 2: Forward Looking Statement
Forward Looking Statement Statements in this communication that are not historical facts are “forward-looking” statements within the meaning of the federal securities laws. These statements include statements regarding our future business plans and expectations. These statements are often, but not a
Slide 3: First Quarter 2025 Overview
First Quarter 2025 Overview TII increased 36.7% to $12.5 million in 1Q 25 from $9.1 million in 4Q 24 Investment • Highest TII in the Company’s history and record high cash TII generation Income NII of $4.6 million, or $0.40 per share in 1Q 25, up from $2.1 million, or $0.20 per share in 4Q 24 • Incr
Slide 4: Quarterly Cash Distributions
Quarterly Cash Distributions June $0.37 30th 14.7% 12.9% Per Share Payable Date Annualized Dividend Annualized Dividend Yield on Stock Price Yield on NAV On May 5, 2025, the The second quarter 2025 The cash distribution The cash distribution Company announced that cash distribution will equates to a
Slide 5: About GECC
About GECC Great Elm Capital Corp. Investment Objective Portfolio Overview Externally managed, total-return- To generate current income and • $341.9 million of portfolio fair value focused BDC capital appreciation by investing • $132.3 million of net asset value (“NAV”) Significant insider ownership
Slide 6: Total Investment Income (TII)
Total Investment Income (TII) TII for the quarter ended March 31, 2025 was a record $12.5 million, compared to $9.1 million for the quarter ended December 31, 2024 • Highest TII quarter and highest cash income quarter in the company’s history Cash Accretion + PIK $000s $12,000 $10,000 $8,000 $6,000
Slide 7: Net Investment Income (NII)
Net Investment Income (NII) NII for the quarter ended March 31, 2025 was a record $4.6 million, or $0.40 per share1, compared to NII of $2.1 million, or $0.20 per share1, for the quarter ended December 31, 2024 • Increase in NII primarily driven by an increase in total investment income $000s $4,500
Slide 8: 1Q 2025 NAV Per Share Bridge
1Q 2025 NAV Per Share Bridge Net assets were approximately $11.46 per share1 ($132.3 million) on March 31, 2025, as compared to $11.79 per share1 ($136.1 million) on December 31, 2024. $0.40 $0.02 $11.79 ($0.37) $11.46 ($0.38) 12/31/24 NAV 1Q25 NII 1Q25 Regular Net Realized Net Unrealized 3/31/25 NA
Slide 9: Q1 2025 Portfolio Review
Q1 2025 Portfolio Review May 6, 2025 ©2025 Great Elm Capital Corp. 9
Slide 10: Total Quarter End Portfolio Detail
Total Quarter End Portfolio Detail1 Debt Investments 94.8%2 $242.9 71.0% 58 Weighted million Of Portfolio 12.3%2 Debt Average Price as Weighted Average Current Fair Value of in Debt Investments % of Par Investments Yield of Debt Investments Debt Investments Equity Investments Fair Value % of Portfol
Slide 11: Portfolio Asset Mix
Portfolio Asset Mix End of Period Investments1 3/31/2025 $332.0 $341.9 $322.9 7% 5% $288.2 7% 3% 7% 4% 11% 3% 3% $258.2 7% 5% 4% 4% 1L 15% $236.4 $235.3 $230.6 5% 5% 12% 4% 5% 10% 2L 3% 3% 3% 3% 3% 6% 10% 3% 4% 13% 8% 13% 13% Specialty Finance 11% 7% 15% 17% 16% 7% 7% CLO 23% 22% 23% 7% 51% 9% 8% Un
Slide 12: Total Quarter End Asset Mix
Total Quarter End Asset Mix Portfolio by Asset Type ($341.9mm) Debt Investments by Rate Type ($240.2mm) Other Equity 7% Yielding Equity 3% Weighted CLO average fixed Fixed Rate 15% rate yield of 27% Corporate 11.1%1 Credit Floating SF - Equity Rate 62% 4% 73% Weighted average SF - Debt floating rate
Slide 13: Corporate Portfolio Overview
Corporate Portfolio Overview May 6, 2025 ©2025 Great Elm Capital Corp. 13
Slide 14: Corporate Portfolio Investment Mix Type
Corporate Portfolio1 Investment Mix Type ($mm) $255.5 6% $239.6 $246.9 10% $215.4 14% 10% $202.8 9% 4% 4% 6% 6% 6% 6% 5% 7% 9% 7% 8% 9% 7% 11% 10% 65% 71% 71% 70% 67% 1Q24 2Q24 3Q24 4Q24 1Q25 1L 2L Unsecured Yielding Equity Other Equity 1 Excludes fair value of non-accrual investments in the respect
Slide 15: Corporate Portfolio: Fixed and Floating Rate Exposure
Corporate Portfolio: Fixed and Floating Rate Exposure Portfolio by Rate Type 3/31/2025 1% Weighted Average Value % of 10% ($mm) Corp. Price Coupon Maturity CY Fixed Rate $34.3 14% 98.53 9.5% 3.0 yrs 9.7% 17% Floating Rate $176.1 71% 94.63 12.2% 3.2 yrs 12.9% Total Credit $210.4 85% 95.24 11.8% 3.2 y
Slide 16: Corporate Portfolio: Industry Breakdown
Corporate Portfolio: Industry Breakdown March 31, 2025 Percentage of Fair Value Industry Investments at Fair Value ($ in 000s) % of Fair Value Technology $31,729 12.8% Technology Consumer Products $25,675 10.4% 12% 12.8% Consumer Products Transportation Equipment Mfg $25,611 10.4% Transportation Equ
Slide 17: CLO Joint Venture Overview
CLO Joint Venture Overview May 6, 2025 ©2025 Great Elm Capital Corp. 17
Slide 18: CLO Formation JV, LLC ("CLO JV")
1 CLO Formation JV, LLC ("CLO JV") Innovative Structure for Financing 1st Lien Loans and Holding CLO Investments • CLO JV holds majority positions in CLO Subordinated Notes (colloquially referred to as CLO Equity) • Provides GECC exposure to diverse portfolio of broadly syndicated first lien loans O
Slide 19: CLO JV Portfolio Composition
CLO JV Portfolio Composition Combined underlying CLO portfolios S&P Ratings Distribution CLO Underlying Asset Mix 1% 3% 4.6% 0.5% 1.6% 15.1% 78.1% 96% A BBB BB B CCC 1st Lien 2nd Lien Unsecured May 6, 2025 ©2025 Great Elm Capital Corp. 19
Slide 20: CLO Issuer Concentration
CLO Issuer Concentration Top 10 Issuers represent 10.8% of the combined CLOs, with no single issuer representing > 1.1% weighting Aggregate Issuer Concentration Sector Composition Issuer Total Exposure % Weighting Financials Chemicals Tenneco $12.1mm 1.1% Professional Services Health Care DIRECTV $1
Slide 21: Great Elm Specialty Finance
Great Elm Specialty Finance May 6, 2025 ©2025 Great Elm Capital Corp. 21
Slide 22: Specialty Finance Overview
Specialty Finance Overview The Specialty Finance Platform Operates Across the “Continuum of Lending” Equity ownership in Specialty Finance Companies (SFCs) generates two levels of proprietary investment exposure for investors: • We believe direct investments in SFCs are largely uncorrelated to the b
Slide 23: Great Elm Specialty Finance
Great Elm Specialty Finance Great Elm Specialty Finance (“GESF”) is a subsidiary of GECC formed to oversee Specialty Finance investments and all future specialty finance acquisitions, strategic partnerships, and direct origination opportunities • GESF oversees existing platforms – shaded below • In
Slide 24: GESF: Prestige Capital
GESF: Prestige Capital Provider of “spot factoring” services, providing clients with opportunities to sell individual accounts receivable for upfront payments Functional Risk Management Prestige purchases the individual The combination of clients’ capital needs accounts receivable of creditworthy an
Slide 25: GESF: Great Elm Commercial Finance
GESF: Great Elm Commercial Finance (fka Sterling Commercial Credit) Provider of asset-based loans to small and middle market companies throughout the United States Direct Lending Solution Diversified Products Sterling provides short term, asset-based Sterling offers a variety of product types loans
Slide 26: GESF: Great Elm Healthcare Finance
GESF: Great Elm Healthcare Finance Repositioned in 1Q 25 to hold Healthcare-related real estate assets • Building a robust pipeline of proprietary deal flow alongside ABL originations at Great Elm Commercial Finance Robust Underwriting Nationwide Lending Focus • Asset driven focus Industries: • Emph
Slide 27: Q1 2025 Financial Review
Q1 2025 Financial Review May 6, 2025 ©2025 Great Elm Capital Corp. 27
Slide 28: Financial Review: Per Share Data
Financial Review: Per Share Data Financial Highlights – Per Share Data 1Q 24 2Q 24 3Q 24 4Q 24 1Q 25 Earnings Per Share (“EPS”) ($0.05) ($0.14) $0.33 $0.17 $0.04 Net Investment Income (“NII”) $0.37 $0.32 $0.39 $0.20 $0.40 Per Share Pre-Incentive NII Per Share $0.46 $0.40 $0.49 $0.20 $0.50 Net Realiz
Slide 29: Financial Review: Quarterly Operating Results
Financial Review: Quarterly Operating Results 1Q 2024 2Q 2024 3Q 2024 4Q 2024 1Q 2025 $ in $000s Per Share1 Per Share1 Per Share1 Per Share1 Per Share1 Total Investment Income $8,909 $1.03 $9,548 $1.00 $11,727 $1.12 $9,139 $0.85 $12,495 $1.08 Interest Income 7,581 0.88 7,763 0.81 8,121 0.78 8,076 0.
Slide 30: Financial Review: Portfolio
Financial Review: Portfolio Financial Highlights - Portfolio 1Q 24 2Q 24 3Q 24 4Q 24 1Q 25 Capital Deployed $64.2 million $108.9 million $73.6 million $47.2 million $37.4 million Investments Monetized $28.9 million $72.4 million $39.1 million $57.5 million $13.8 million Total Fair Value of Investmen
Slide 31: General Risks
General Risks Debt instruments are subject to credit and interest rate risks. Credit risk refers to the likelihood that an obligor will default in the payment of principal or interest on an instrument. Financial strength and solvency of an obligor are the primary factors influencing credit risk. In
Slide 32: Contact Information
Contact Information Media & Investor Contact: Investors Relations investorrelations@greatelmcap.com May 6, 2025 ©2025 Great Elm Capital Corp. 32