管理層發言
Good morning, and thank you all for attending the Oxford Lane Capital Corp. announcement of its net asset value and selected financial results for the fourth fiscal quarter. My name is Braca, and I will be your moderator today. I would now like to hand the conference over to your host, Jonathan Cohen, CEO of Oxford Lane Capital Corp. Thank you. You may proceed, Jonathan.
Thank you. Good morning, everyone, and welcome to the Oxford Lane Capital Corp. fourth fiscal quarter 2025 earnings conference call. I'm joined today by Saul Rosenthal, our President; Bruce Rubin, our CFO; and Joe Kupka, our Managing Director. Bruce, could you open the call with a disclosure regarding forward-looking statements?
Sure, Jonathan. Today's conference call is being recorded. An audio replay of the call will be available for 30 days. Replay information is included in our press release that was issued earlier this morning. 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. 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 these projections. We do not undertake to update our forward-looking statements unless required to do so by law. During this call, we will 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 provided on our website at www.oxfordlanecapital.com. With that, I'll turn the presentation back over to Jonathan.
Thank you, Bruce. On March 31, 2025, our net asset value per share was $4.32, down from $4.82 in the previous quarter. For the quarter ending in March, we reported GAAP total investment income of approximately $121.2 million, which is an increase of about $6.7 million from the prior quarter. The GAAP total investment income for this quarter included roughly $115.3 million from our CLO equity and CLO warehouse investments, and around $5.9 million from CLO debt investments and other income. Oxford Lane recorded GAAP net investment income of about $75.4 million or $0.18 per share for the quarter ending in March, compared to approximately $72.4 million or $0.20 per share for the quarter ending December 31. Our core net investment income was approximately $95.8 million or $0.23 per share for the quarter ending in March, compared to around $99.9 million or $0.28 per share for the quarter ending December 31.
As of March 31, we held around $639.1 million in newly issued or acquired CLO equity investments that had not yet made initial equity distributions to Oxford Lane Capital Corp. For the quarter ended in March, we recorded net unrealized depreciation on investments of roughly $187.7 million and net realized losses of approximately $8.5 million. We had a net decrease in net assets from operations of about $120.8 million or $0.28 per share for the fourth fiscal quarter. As of March 31, the following metrics were applicable. We note that none of these metrics necessarily indicated a total return to shareholders. The weighted average yield of our CLO debt investments at current cost was 15.9%, down from 16.6% as of December 31. The weighted average effective yield of our CLO equity investments at current cost was 15.9%, down from 16.1% as of December 31. The weighted average cash distribution yield of our CLO equity investments at current cost was 20.5%, down from 23.9% as of December 31.
The cash distribution yields calculated on our CLO equity investments are based on the cash distributions we received or were entitled to receive at each respective period end. During the quarter ended in March, we issued about 60.7 million shares of our common stock through an aftermarket offering, yielding net proceeds of approximately $300.5 million. We made additional CLO investments of roughly $526.2 million during the quarter and received about $136 million from sales and repayments. As previously announced, on March 26, our Board of Directors declared monthly common stock distributions of $0.09 per share for each month ending July, August, and September of 2025. Finally, as announced on May 16, we were recognized as the best public closed fund by Credit Flux at their London Conference. With that, I'll turn the call over to our Managing Director, Joe Kupka.
Thanks, Jonathan. During the quarter ended March 31, 2025, U.S. loan market performance weakened versus the prior quarter. U.S. loan price index decreased from 97.33% as of December 31, 2024, to 96.31% as of March 31. The decrease in U.S. loan prices led to an approximate 12-point decrease in median U.S. CLO equity net asset values. Additionally, due to elevated levels of repricing activity, we observed median weighted average spreads across loan pools within CLO portfolios decreased to 330 basis points compared to 334 basis points last quarter. The 12-month trailing default rate for the loan index declined to 0.8% by principal amount at the end of the quarter from 0.9% at the end of December 2024. We note that out-of-court restructurings, exchanges and subpar buybacks, which are not captured in the cited default rate remain elevated. CLO new issuance for the quarter totaled approximately $49 billion, reflecting a nearly $11 billion decline from the previous quarter, though issuance volume kept pace with the first quarter of 2024, a record-breaking year.
Additionally, the U.S. CLO market saw over $100 billion in reset and refinancing activity in Q1 '25 consistent with levels seen in the prior quarter. Oxford Lane remained active this quarter, investing over $520 million in CLO equity debt and warehouses, while participating in opportunistic resets and refinancings. As a function of our overall activity during the quarter, we were able to lengthen the weighted average reinvestment period of Oxford Lane CLO equity portfolio from February 2028 to November 2028. Our primary investment strategy during the quarter was to engage in relative value trading and seek to lengthen the weighted average reinvestment period of Oxford Lane CLO equity portfolio. In the current market environment, we intend to continue to utilize our opportunistic and unconstrained CLO investment strategy across U.S. 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. With that, I'll turn the call back over to Jonathan.
Thanks very much, Joe. With that, operator, we're happy to open the call for any questions.
分析師問答
Thank you. We will now begin the question-and-answer session. We have a question from Deja Sakon with Private Investor. Please go ahead.
Think about the share repurchase program, have you purchased any shares yet under that?
We haven't disclosed that information.
Thank you. We will now move on to Erik Zwick with Lucid Capital Markets.
Hi, guys. Hi, Jonathan. This is Justin on for Erik today. So I was wondering if you guys could talk about pricing dynamics in the current quarter, understanding that yields were down in the quarter ended in March and maybe what you're expecting to see for this year.
Joe?
Yes. Are you referring to CLO equity trading levels in particular or the liability market, anything in particular you're looking to go over?
I guess kind of just at a high level, where you guys are expecting yields to go for the investment portfolio.
Sure. We don't have a specific target, Justin, or projection in terms of anticipated yields. What we can say is that between the end of calendar 2024 and March 31, we saw a dramatic diminishment in CLO tranche pricing, significant illiquidity in the marketplace, and a general level of stress accompanying the levels of stress that we saw in public and private equity markets, the U.S. syndicated corporate loan market, the public corporate bond market, all of those things were fairly tightly correlated during that period of economic dislocation. As we move forward to the end of April, we obviously saw that get worse. And then rebound very, very substantially between April 30 and May 16, last Friday. So as you know, we've obviously seen a fair amount of volatility across this and most other asset classes. But in terms of a specific point estimate of where we anticipate yields to reside for the remainder of this calendar year, we have none.
Okay. All right. That's great. And then maybe if you guys could talk about the relative attractiveness in the primary versus secondary markets and kind of how the investment portfolio is positioned in terms of cyclicality in the companies that are invested in?
Yes. So I think the answer to those questions kind of are linked. We are constantly reevaluating the relative attractiveness of the primary and the secondary. AAAs in particular are still undergoing some price discovery. So that's a calculation we are reassessing every day. We're still seeing attractive opportunities in both the primary and secondary. So depending on the particular offers or structures that we were able to create at the primary, we are active in both markets. In terms of the cyclicality part of the question, one thing we are focused on is just lengthening that reinvestment period as much as possible just to lessen that part of the risk spectrum. So that's one way we think of it, just lengthening the runway for our managers, allowing them to work out of any problems that arise.
Sure. And in addition to what Joe just referenced, Justin, there is also the economic issue associated with holding long-dated CLO equity during periods of economic and financial dislocation, which we think has historically provided us with strong economic returns.
Great. Okay. That helps. And then just last one for me on sort of your strategy. Curious how you guys differentiate yourselves from peers. Any sort of qualitative or quantitative examples on your strategy. And how you guys relate to any other peers would be helpful.
Sure. Obviously, we don't track our peers with the precision that we track our own performance and we monitor our own portfolios. I think historically, Justin, we've differentiated ourselves in a couple of ways. Firstly, as you know, we run a completely unconstrained CLO investment strategy, meaning that we can look at long-dated CLO equity, short-dated CLO equity primary tranches, secondary tranches, we warehouse, obviously, a fair amount. We are one of the largest market participants in both the primary and secondary markets and also we rotate the portfolio aggressively. So again, I can't speak to the investment strategies of other firms, but we view this asset class as particularly appropriate for an active portfolio management strategy, which is very much what we engage in.
Right. That’s helpful. Thanks for taking my question. That’s all from me.
Thank you, Justin.
I can see that we have no further questions. So I would like to hand it back to Jonathan for some final closing comments.
Well, I'd like to thank everyone for their interest in Oxford Lane Capital and for their participation on this call or listening to the replay. And we look forward to speaking to you again soon. Thanks very much.
Thank you all for joining the Oxford Lane Capital Corp. call today. At this time, today's call has concluded. You may now disconnect, and thank you for your participation.