Oxford Square Capital Q2 2025 Earnings Report

Oxford Square Capital EPS Results

• Actual EPS: $0.08
• Consensus EPS: $0.08
• Beat/Miss: Met Expectations
• One Year Ago EPS: N/A

Oxford Square Capital Revenue Results

• Actual Revenue: $9.52 million
• Expected Revenue: $10.00 million
• Beat/Miss: Missed by -$478.00 thousand
• YoY Revenue Growth: N/A

Oxford Square Capital Announcement Details

• Quarter: Q2 2025
• Date: 8/7/2025
• Time: Before Market Opens
• Conference Call Date: Thursday, August 7, 2025
• Conference Call Time: 9:00AM ET

Oxford Square Capital (NASDAQ:OXSQ) is a business development company, operates as a closed-end, non-diversified management investment company. It is a private equity and mezzanine firm. The firm invests in both public and private companies. It invests in secured and unsecured senior debt, subordinated debt, junior subordinated debt, preferred stock, common stock and syndicated bank loans. The firm primarily invests in debt and/or equity securities of technology-related companies that operate in the computer software, Internet, information technology infrastructure and services, media, telecommunications and telecommunications equipment, semiconductors, hardware, technology-enabled services, semiconductor capital equipment, medical device technology, diversified technology, and networking systems sectors. It concentrates its investments in companies having annual revenues of less than $200 million and a market capitalization or enterprise value of less than $300 million. The firm invests between $5 million and $30 million per transaction. It seeks to exit its investments within 7 years. It serves as the investment adviser to TICC. Oxford Square Capital Corp., formerly known as TICC Capital Corp., was founded in 2003 and is headquartered in Greenwich, Connecticut.

Oxford Square Capital Q2 2025 Earnings Call Transcript

Key Takeaways

• Negative Sentiment: Our net investment income fell to $5.5 million (8¢ per share) and NAV per share dropped to $2.06, down from $6.1 million (9¢) and $2.91 last quarter.
• Positive Sentiment: We issued 4.9 million common shares in an aftermarket offering, raising net proceeds of ~$11.6 million.
• Positive Sentiment: We priced a $65 million underwritten offering of 7.75% unsecured notes due 2030 to fund new investments and repay debt.
• Positive Sentiment: US loan market performance strengthened, with the LSTA index rising from 96.31% to 97.07% of par and BB, B and CCC loan prices gaining 35–235 bps.
• Negative Sentiment: Default rates climbed to 1.11% (4.46% including liability management) and the distressed ratio increased to 3.6%, indicating elevated credit stress.

[Operator]

Call. At this time, all lines are in a listen only mode. Following the presentation, we will conduct a question and answer session. This call is being recorded on Thursday, 08/07/2025. I would now like to turn the conference over to Jonathan H.

[Operator]

Cohen, CEO. Please go ahead.

[Speaker 1]

Good morning. Welcome to the Oxford Square Capital Corp. Second Quarter twenty twenty five Earnings Conference Call. I'm joined today by Saul Rosenthal, our President Vince Guerrero, our Controller and Vice President of Finance and Kevin Yonan, our Managing Director and Portfolio Manager. Vince, could you open the call with the disclosure regarding forward looking statements?

[Speaker 1]

Sure, Jonathan. Today's conference call is being recorded. An audio replay of the conference call will be available for thirty days. Replay information is included in our press release that was issued this morning. Please note that this call is the property of Oxford Square Capital Corp.

[Speaker 1]

Any unauthorized rebroadcast of this call from any form is strictly prohibited. At this point, please direct your attention to the customary disclosure in this morning's 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 those projections. We do not undertake to update our forward looking statements unless required to do so by law.

[Speaker 1]

To obtain copies of our latest SEC filings, please visit our website at www.oxfordsquarecapital.com. With that, I will turn the presentation back over to John. Thanks, Vince. For the quarter ended June, Oxford Square's net investment income was approximately $5,500,000 or 8¢ per share compared with approximately $6,100,000 or $09 per share in the prior quarter. Our net asset value per share stood at $2.06 compared to a net asset value per share of $2.9 for the prior quarter.

[Speaker 1]

During the quarter, we distributed $0.01 $05 per share to our common stock shareholders. For the second quarter, we recorded total investment income of approximately $9,500,000 as compared to approximately $10,200,000 in the prior quarter. In the second quarter, we recorded combined net unrealized and realized losses on investments of approximately 1,100,000 or $01 per share compared to combined net unrealized and realized losses on investments of approximately $14,200,000 or $0.20 per share for the prior quarter. During the second quarter, our investment activity consisted of repayments of approximately $233,000 During the quarter ended June, we issued a total of approximately 4,900,000.0 shares of our common stock pursuant to an aftermarket offering, resulting in net proceeds of approximately $11,600,000 On June 30, our Board of Directors declared monthly distributions of 3.5¢ per share for each of the months ending October, November and December 2025. Additional details regarding record and payment date information can be found in our press release that was issued this morning.

[Speaker 1]

On August 1, we announced that we priced an under or an underwritten public offering of $65,000,000 in aggregate principal amount of seven and three quarter percent unsecured notes due 02/1930, which will be used for investments and for repayment of existing debt. With that, I will turn the call over to our portfolio manager, Kevin Yonne. Kevin? Thank you, Jonathan. During the quarter ended June 30, US loan market performance strengthened versus the prior quarter.

[Speaker 1]

US loan prices, as defined by the Moonstar LSTA US leverage loan index, increased from 96.31% of par as of March 31 to ninety seven point o 7% of par as of June 30. According to LCD, during the quarter, there were some pricing dispersion with double b rated loan prices increasing 35 basis points, b rated loan prices increasing 68 basis points, and triple c rated loan prices increasing 235 basis points on average. According to PitchBook LCD, while the twelve month trailing default rate for the loan index increased to 1.11% by principal amount at the end of the quarter from 0.82 at the March, we note that the default rate, including various forms of liability management exercises, which are not captured in the decided default rate, remain at an elevated level of 4.46%. Additionally, the distressed ratio, defined as a percentage of loans with prices below 80% of par, ended the quarter at three point o 6% compared to 3.21% at the March. During the quarter ended 06/30/2025, U.

[Speaker 1]

S. Leverage on primary market issuance, excluding amendments and repricing transactions, was $76,300,000,000 representing a 48% decrease versus the quarter ended June 3024. This was driven by lower opportunistic activity, including refinancings and the funding of dividends, partly offset by higher nonrefinancing issuance, including M and A and LDO activity versus the prior year comparable quarter. At the same time, U. S.

[Speaker 1]

Loan fund outflows, as measured by Lipper, were approximately $5,940,000,000 for the quarter ended June 30. We continue to focus on portfolio management strategies designed to maximize our long term total And as a permanent capital vehicle, we historically have been able to take a longer term view towards our investment strategy. With that, I will turn the call back over to Jonathan. Thank you, Kevin, very much. Additional information about Oxford Square's second quarter performance has been posted to our website at www.oxfordsquarecapital.com.

[Speaker 1]

And with that, operator, we're happy to open the call up for any questions.

[Operator]

Thank you. Ladies and gentlemen, we will now begin the question and answer session. Should you have a question, please press the star followed by the one on your touch tone phone. You will hear a prompt that your hand has been raised. Should you wish to decline from the polling process, please press the star followed by the two.

[Operator]

If you are using a speaker phone, please leave the handset before pressing any key. One moment, please, for your first question. I am showing no questions at this time. I will now turn the call back to Mr. Collins.

[Speaker 1]

Thank you very much. We'd like to thank everyone on the call and listening to the replay for their interest in Oxford Square. We look forward to speaking to you again soon. Thanks very much.

[Operator]

Ladies and gentlemen, this concludes today's conference call. Thank you for your participation. You may now disconnect.