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| Statement |
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| Our investment portfolio as well as the right side of the company's balance sheet with all fixed rate financing were both intentionally designed for markets like these and are clearly benefiting our shareholders through increased cash distribution |
| Along with our strong portfolio performance, we also opportunistically raised capital through our at-the-market program, issuing just over 1 million common shares at a premium to NAV, generating NAV accretion of $0.03 per share during the quarter |
| We had another quarter-over-quarter increase in our portfolio cash flows, our NAV increased and our net investment income, again, comfortably exceeded the monthly common distributions that we paid |
| We continue to see attractive return profiles in the secondary market |
| Additional focus on a higher for longer interest rate scenario, we believe will further benefit the company and our financial outlook |
| We also handsomely outperformed the Credit Suisse Leveraged Loan Index, which generated its best performance in nearly 15 years and the second best performance on record with a total return of 13.04% for the full year |
| We remain very confident that EIC is well positioned to continue generating compelling risk-adjusted returns for our shareholders |
| EIC had a great 2023 and the elevated rate environment has helped us to significantly grow our NII |
| This all translates directly into strong returns for our shareholders |
| EIC has continued to successfully capitalize on the elevated rate environment with the floating rate nature of our underlying portfolio, and our shareholders have been very well rewarded compared to other fixed income asset classes |
| Even if default should rise from these levels, we continue to believe our portfolio is well positioned for environments like these |
| We remain excited for our portfolio's potential as we start the new year |
| We remain excited about the investment opportunities within the CLO market, in particular, the junior debt and equity portions of the capital structure |
| We've been able to increase our distributions to shareholders multiple times over the past two years |
| Importantly, we believe our usage of the ATM program is helping to drive additional liquidity in our common shares |
| As long-term focused investors, we seek to construct our portfolio to weather multiple economic cycles and our consistently strong performance with respect to cash flow and income is validation that we're executing on that playbook |
| This is the highest monthly common distribution per share in our history and represents our eighth increase since the beginning of 2021 |
| Our NAV as of December 31 was $14.39 per share, and this is an increase of 2% from September and our NAV grew by 11% in total during the year |
| Our GAAP return on equity for 2023 was 25.93% and the total return on our common stock, assuming reinvestment of distributions, was 21.37% for the year, good returns by any measure |
| The three attributes why we remain excited to be managing a CLO BB focused fund back in 2019 at our IPO ring as true as ever today |
| As we move to 2024, we remain in a very strong position with ample dry powder to deploy into new investments |
| Given our confidence in our portfolio and our overall outlook, beginning last month, we increased our regular monthly common distribution by another 11% to $0.20 per share per month |
| As of December 11, the company's net asset value was $158 million or $14.39 per share, a 2% increase from September month of 2023 and an 11% increase from $12.91 at the beginning of the year |
| We will continue to be opportunistic and we'll act where we believe we can achieve compelling risk-adjusted returns for the company's portfolio |
| This represents a modest quarter-over-quarter increase and provides our CLOs with valuable par dollars to reinvest in today's discounted loan market |
| So far in the new year, there has been a notable increase in demand for CLO AAAs |
| In our view, CLO BBs continue to be one of the most resilient risk asset classes out there attributable to their structural protections and floating rate nature |
| While past performance is obviously not a guarantee of future results, we believe the performance of our portfolio over the past few years has certainly validated the company's investment strategy |
| And as of February 15, we have over $26 million of cash and revolver borrowing capacity available to us, ample dry powder with which to invest as we further expand our portfolio |
| Since the end of 2023, we estimated our NAV at January month end to be between $14.94 and $15.04 per share, a further 4.2% increase at the midpoint from year-end |
| Statement |
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| As a result, the trailing 12-month default rate of 1.5% as of December 31, remaining well below the historic average of 2.7% |
| EIC's portfolios default exposure as of December 31 stood at 0.6%, well below the market rate |
| There were a total of 4 syndicated loan defaults in the fourth quarter down from 6 in the prior quarter as senior secured loans and thus CLOs continue to be resilient |
| We believe we would take a significant amount of loan defaults well above the historical average, coupled with limited loan price volatility for EIC to be materially impacted by a default wave |
| As we've consistently noted, CLO BBs have withstood multiple economic downturns in the past, experiencing very low long-term default rates |
| We also expect that refinancings, resets and calls will lead to some of our discounted CLO BB purchases from last year being paid off at par, achieving the pull to par and convexity in our investments sooner than anticipated |
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