GECC’s Investment Adviser Waives Incentive Fees Totaling
Net Investment Income (“NII”) of
NAV of
Approximately
Strong Liquidity Position with Approximately
Extended Revolving Credit Facility Maturity from 2027 to 2029
Called Remaining
In
Board Declares
Management Commentary
We remain disciplined in how we deploy capital. During the quarter, we completed several attractive private credit investments, selectively expanded our broadly syndicated investment portfolio, and continued to actively manage portfolio risk. At quarter end, less than 1% of investments were on nonaccrual, reflecting the quality of the portfolio and our disciplined underwriting approach.
We also continued to strengthen our capital structure by retiring all outstanding GECCO notes during the quarter, extending the maturity of our revolving credit facility, and, subsequent to quarter end, calling
Although the market remains competitive, we believe our disciplined investment process, strong liquidity, and conservative balance sheet position us to continue creating long-term value for our shareholders.”
Recent Board Actions and Shareholder Returns
- GECM waived all accrued incentive fees for the quarter ended
June 30, 2026 , totaling$0.9 million , or$0.06 per share, in addition to previously waiving all$2.8 million , or$0.20 per share, of accrued incentive fees throughMarch 31, 2026 . - The Company’s Board of Directors approved a quarterly dividend of
$0.25 per share for the third quarter of 2026, equating to an 18.9% annualized yield on GECC’sAugust 4, 2026 , closing price of$5.29 . - Beginning
January 1, 2026 throughAugust 4, 2026 , the Company repurchased approximately 0.1 million shares for$0.5 million , at an average price of$4.98 per share or a 37% discount to the Company’s net asset value (“NAV”) onJune 30, 2026 , leaving approximately$9.5 million of remaining capacity under the$10 million stock repurchase program previously authorized by the Company's Board of Directors.
Second Quarter and Recent Operating Highlights
- Total investment income (“TII”) for the quarter ended
June 30, 2026 , was$10.9 million , as compared to$9.5 million for the quarter endedMarch 31, 2026 .- The quarter-over-quarter increase was primarily driven by a
$2.0 million dividend received from the Company's investment in insurance-related preference shares.
- The quarter-over-quarter increase was primarily driven by a
- Net investment income (“NII”) for the quarter ended
June 30, 2026 , was$4.5 million , or$0.32 per share, as compared to$5.0 million , or$0.36 per share, for the quarter endedMarch 31, 2026 .- NII decreased, despite higher TII, primarily due to the size of the benefit of the incentive fee waiver received in the prior quarter.
- Pre-incentive fee NII increased approximately 66% quarter-over-quarter to
$4.5 million for the quarter endedJune 30, 2026 , from$2.7 million for the quarter endedMarch 31, 2026 .
- Net assets were
$110.4 million , or$7.95 per share, as ofJune 30, 2026 , as compared to$107.5 million , or$7.74 per share, as ofMarch 31, 2026 .- 2.7% quarter-over-quarter growth in net assets was primarily driven by realized and unrealized gains on investments, notably the CoreWeave-related equity investment.
- During the quarter ended
June 30, 2026 , GECC received$2.6 million of distributions from its CoreWeave-related equity investment, bringing total distributions to date to approximately$9.5 million , well in excess of its$6.0 million original capital investment. - GECC’s asset coverage ratio was 166.4% as of
June 30, 2026 , as compared to 161.8% as ofMarch 31, 2026 .
Financial Highlights – Per Share Data
| Q2/2025 | Q3/2025 | Q4/2025 | Q1/2026 | Q2/2026 | |||||||||||
| Earnings Per Share ("EPS") | $ | 1.02 | $ | (1.79 | ) | $ | (1.57 | ) | $ | (0.05 | ) | $ | 0.46 | ||
| Net Investment Income ("NII") Per Share | $ | 0.51 | $ | 0.20 | $ | 0.31 | $ | 0.36 | $ | 0.32 | |||||
| Net Realized and Unrealized Gains / (Losses) Per Share | $ | 0.51 | $ | (1.98 | ) | $ | (1.88 | ) | $ | (0.41 | ) | $ | 0.14 | ||
| Net Asset Value ("NAV") Per Share | $ | 12.10 | $ | 10.01 | $ | 8.07 | $ | 7.74 | $ | 7.95 | |||||
| Distributions Paid / Declared Per Share | $ | 0.37 | $ | 0.37 | $ | 0.37 | $ | 0.30 | $ | 0.25 | |||||
Financial Review
Total investment income for the quarter ended
Net realized and unrealized gains for the quarter ended
Liquidity and Capital Resources
As of
As of
Distributions
The Company’s Board of Directors has approved a quarterly cash distribution of
The distribution equates to an 18.9% annualized dividend yield on the Company’s closing market price of
Stock Repurchase Program
The Company’s Board of Directors authorized a stock repurchase program in
Conference Call and Webcast
GECC will discuss these results in a conference call at
| Conference Call Details | |
| Date/Time: | |
| Participant Dial-In Numbers: | |
| ( | 844-825-9789 |
| (International): | 412-317-5180 |
To access the call, please dial-in approximately five minutes before the start time and, when asked, provide the operator with passcode “GECC”. An accompanying slide presentation will be available in pdf format via the “Events and Presentations” section of Great Elm Capital Corp.’s website here after the issuance of the earnings release.
Webcast
The call and presentation will also be simultaneously webcast over the internet via the “Events and Presentations” section of GECC’s website or by clicking on the webcast link here.
About Great Elm Capital Corp.
GECC is an externally managed business development company that seeks to generate current income and capital appreciation by investing in debt and income generating equity securities, including investments in specialty finance businesses and CLOs. For additional information, please visit http://www.greatelmcc.com.
Cautionary Statement Regarding Forward-Looking Statements
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 always, made through the use of words or phrases such as “expect,” “anticipate,” “should,” “will,” “estimate,” “designed,” “seek,” “continue,” “upside,” “potential” and similar expressions. All such forward-looking statements involve estimates and assumptions that are subject to risks, uncertainties and other factors that could cause actual results to differ materially from the results expressed in the statements. The key factors that could cause actual results to differ materially from those projected in the forward-looking statements include, without limitation: conditions in the credit markets, our expected financings and investments, including interest rate volatility, inflationary pressure, the price of GECC common stock and the performance of GECC’s portfolio and investment manager. Information concerning these and other factors can be found in GECC’s Annual Report on Form 10-K and other reports filed with the Securities and Exchange Commission. GECC assumes no obligation to, and expressly disclaims any duty to, update any forward-looking statements contained in this communication or to conform prior statements to actual results or revised expectations except as required by law. Readers are cautioned not to place undue reliance on these forward-looking statements that speak only as of the date hereof.
Media & Investor Contact:
Investor Relations
investorrelations@greatelmcap.com
GREAT ELM CAPITAL CORP.
STATEMENTS OF ASSETS AND LIABILITIES (unaudited)
Dollar amounts in thousands (except per share amounts)
| Assets | ||||||||
| Investments | ||||||||
| Non-affiliated, non-controlled investments, at fair value (amortized cost of | $ | 187,290 | $ | 218,381 | ||||
| Non-affiliated, non-controlled short-term investments, at fair value (amortized cost of | 3,966 | 32,803 | ||||||
| Affiliated investments, at fair value (amortized cost of | - | - | ||||||
| Controlled investments, at fair value (amortized cost of | 80,996 | 79,887 | ||||||
| Total investments | 272,252 | 331,071 | ||||||
| Cash and cash equivalents | 1,669 | 1,834 | ||||||
| Receivable for investments sold | 1,764 | 3,215 | ||||||
| Interest receivable | 1,821 | 2,182 | ||||||
| Dividends receivable | 782 | 1,046 | ||||||
| Due from affiliates | 68 | 218 | ||||||
| Deferred financing costs | 524 | 256 | ||||||
| Prepaid expenses and other assets | 1,102 | 953 | ||||||
| Total assets | $ | 279,982 | $ | 340,775 | ||||
| Liabilities | ||||||||
| Notes payable (including unamortized discount of | $ | 150,853 | $ | 189,319 | ||||
| Revolving credit facility | 11,000 | - | ||||||
| Payable for investments purchased | 5,340 | 33,652 | ||||||
| Interest payable | 153 | 64 | ||||||
| Accrued incentive fees payable | - | 2,267 | ||||||
| Due to affiliates | 1,402 | 1,475 | ||||||
| Accrued expenses and other liabilities | 816 | 1,052 | ||||||
| Total liabilities | $ | 169,564 | $ | 227,829 | ||||
| Commitments and contingencies (Note 7) | ||||||||
| Net Assets | ||||||||
| Common stock, par value | $ | 139 | $ | 140 | ||||
| Additional paid-in capital | 358,239 | 358,778 | ||||||
| Accumulated losses | (247,960 | ) | (245,972 | ) | ||||
| Total net assets | $ | 110,418 | $ | 112,946 | ||||
| Total liabilities and net assets | $ | 279,982 | $ | 340,775 | ||||
| Net asset value per share | $ | 7.95 | $ | 8.07 | ||||
STATEMENTS OF OPERATIONS (unaudited)
Dollar amounts in thousands (except per share amounts)
| For the Three Months Ended | For the Six Months Ended | |||||||||||||||
| 2026 | 2025 | 2026 | 2025 | |||||||||||||
| Investment Income: | ||||||||||||||||
| Interest income from: | ||||||||||||||||
| Non-affiliated, non-controlled investments | $ | 4,555 | $ | 6,560 | $ | 9,644 | $ | 12,962 | ||||||||
| Non-affiliated, non-controlled investments (PIK) | 703 | 644 | 1,522 | 1,255 | ||||||||||||
| Controlled investments | 899 | 765 | 1,711 | 1,718 | ||||||||||||
| Total interest income | 6,157 | 7,969 | 12,877 | 15,935 | ||||||||||||
| Dividend income from: | ||||||||||||||||
| Non-affiliated, non-controlled investments | 2,048 | 2,332 | 2,207 | 2,568 | ||||||||||||
| Controlled investments | 2,569 | 3,904 | 5,115 | 7,280 | ||||||||||||
| Total dividend income | 4,617 | 6,236 | 7,322 | 9,848 | ||||||||||||
| Other income from: | ||||||||||||||||
| Non-affiliated, non-controlled investments | 122 | 72 | 241 | 815 | ||||||||||||
| Non-affiliated, non-controlled investments (PIK) | - | - | - | 174 | ||||||||||||
| Total other income | 122 | 72 | 241 | 989 | ||||||||||||
| Total investment income | $ | 10,896 | $ | 14,277 | $ | 20,440 | $ | 26,772 | ||||||||
| Expenses: | ||||||||||||||||
| Management fees | $ | 1,015 | $ | 1,278 | $ | 2,087 | $ | 2,550 | ||||||||
| Incentive fees | 901 | 1,470 | 1,444 | 2,620 | ||||||||||||
| Administration fees | 472 | 383 | 982 | 738 | ||||||||||||
| Custody fees | 33 | 37 | 68 | 75 | ||||||||||||
| Directors’ fees | 53 | 53 | 107 | 106 | ||||||||||||
| Professional services | 587 | 459 | 1,101 | 883 | ||||||||||||
| Interest expense | 3,868 | 4,318 | 8,124 | 8,569 | ||||||||||||
| Other expenses | 282 | 307 | 578 | 615 | ||||||||||||
| Total expenses | $ | 7,211 | $ | 8,305 | $ | 14,491 | $ | 16,156 | ||||||||
| Incentive fee waiver | (901 | ) | - | (3,711 | ) | - | ||||||||||
| Net expenses | $ | 6,310 | $ | 8,305 | $ | 10,780 | $ | 16,156 | ||||||||
| Net investment income before taxes | $ | 4,586 | $ | 5,972 | $ | 9,660 | $ | 10,616 | ||||||||
| Excise tax | $ | 83 | $ | 68 | $ | 174 | $ | 136 | ||||||||
| Net investment income | $ | 4,503 | $ | 5,904 | $ | 9,486 | $ | 10,480 | ||||||||
| Net realized and unrealized gains (losses): | ||||||||||||||||
| Net realized gain (loss) on investment transactions from: | ||||||||||||||||
| Non-affiliated, non-controlled investments | $ | 2,943 | $ | 459 | $ | 5,575 | $ | 723 | ||||||||
| Realized loss on repurchase of debt | - | - | (2 | ) | - | |||||||||||
| Total net realized gain (loss) | 2,943 | 459 | 5,573 | 723 | ||||||||||||
| Net change in unrealized appreciation (depreciation) on investment transactions from: | ||||||||||||||||
| Non-affiliated, non-controlled investments | (187 | ) | 7,679 | (4,038 | ) | 5,613 | ||||||||||
| Controlled investments | (834 | ) | (2,299 | ) | (5,341 | ) | (4,620 | ) | ||||||||
| Total net change in unrealized appreciation (depreciation) | (1,021 | ) | 5,380 | (9,379 | ) | 993 | ||||||||||
| Net realized and unrealized gains (losses) | $ | 1,922 | $ | 5,839 | $ | (3,806 | ) | $ | 1,716 | |||||||
| Net increase (decrease) in net assets resulting from operations | $ | 6,425 | $ | 11,743 | $ | 5,680 | $ | 12,196 | ||||||||
| Earnings per share (basic and diluted): | $ | 0.46 | $ | 1.02 | $ | 0.41 | $ | 1.06 | ||||||||
| Weighted average shares outstanding (basic and diluted): | 13,889,803 | 11,556,857 | 13,937,053 | 11,550,739 | ||||||||||||
