CION Investment Corporation Reports Fourth Quarter and Year End 2024 Financial Results
Continued Strong Performance in 2024 With $1.79 in Net Investment Income and $1.52 in Total Shareholder Distributions
NEW YORK--(BUSINESS WIRE)--March 13, 2025--
CION Investment Corporation $(CION)$ ("CION" or the "Company") today reported financial results for the fourth quarter and year ended December 31, 2024 and filed its Form 10-K with the U.S. Securities and Exchange Commission.
CION also announced that, on March 10, 2025, its co-chief executive officers declared a first quarter 2025 base distribution of $0.36 per share payable on April 11, 2025 to shareholders of record as of March 28, 2025.
FOURTH QUARTER AND OTHER HIGHLIGHTS
-- Net investment income and earnings per share for the quarter ended
December 31, 2024 were $0.35 per share and $0.10 per share, respectively;
-- Net asset value per share was $15.43 as of December 31, 2024 compared to
$15.73 as of September 30, 2024, a decrease of $0.30 per share, or 1.9%.
The decrease was primarily due to mark-to-market price adjustments to the
Company's portfolio during the quarter ended December 31, 2024;
-- As of December 31, 2024, the Company had $1.12 billion of total principal
amount of debt outstanding, of which 38% was comprised of senior secured
bank debt and 62% was comprised of unsecured debt. The Company's net
debt-to-equity ratio was 1.27x as of December 31, 2024 compared to 1.18x
as of September 30, 2024;
-- As of December 31, 2024, the Company had total investments at fair value
of $1.82 billion in 105 portfolio companies across 24 industries. The
investment portfolio was comprised of 86.1% senior secured loans,
including 86.0% in first lien investments;1
-- During the quarter, the Company funded new investment commitments of $100
million, funded previously unfunded commitments of $12 million, and had
sales and repayments totaling $48 million, resulting in a net increase to
the Company's funded portfolio of $64 million;
-- As of December 31, 2024, investments on non-accrual status amounted to
1.41% and 3.22% of the total investment portfolio at fair value and
amortized cost, respectively, which are down from 1.85% and 3.40%,
respectively, as of September 30, 2024;
-- During the quarter, the Company repurchased 170,617 shares of its common
stock under its 10b5-1 trading plan at an average price of $11.74 per
share for a total repurchase amount of $2.0 million. Through December 31,
2024, the Company repurchased a total of 3,769,171 shares of its common
stock under its 10b5-1 trading plan at an average price of $10.16 per
share for a total repurchase amount of $38.3 million;
-- On October 3, 2024, the Company completed a public baby bond offering in
the U.S. pursuant to which the Company issued $172.5 million of its
unsecured 7.50% Notes due 2029, which listed and commenced trading on the
NYSE under the ticker symbol "CICB" on October 9, 2024; and
-- On February 13, 2025, the Company terminated its existing senior secured
repurchase facility with UBS AG ("UBS") and simultaneously entered into a
new 3-year, $125 million senior secured credit facility with UBS, under
which the floating interest rate payable by the Company on all advances
was reduced by 0.45% per year, from the three-month SOFR plus a credit
spread of 3.20% per year to SOFR plus a credit spread of 2.75% per year.
DISTRIBUTIONS
-- For the quarter ended December 31, 2024, the Company paid a quarterly
base distribution totaling $19.2 million, or $0.36 per share, and
declared a year-end special distribution totaling $2.7 million, or $0.05
per share, paid on January 27, 2025 to shareholders of record as of
December 30, 2024.
Michael A. Reisner, co-Chief Executive Officer of CION, commented:
"We are very pleased with our 2024 results, particularly against a backdrop of elevated competition and shifting expectations around both inflation and interest rates. Our BDC continues to generate a very attractive yield for our investors, which was enhanced this past year by our mid-year and year-end special distributions. We also had the pleasure of hosting both analysts and investors at CION's first investor day as a listed company in January, highlighting our unique investment strategy as well as our track record of strong shareholder returns."
SELECTED FINANCIAL HIGHLIGHTS
As of
-----------------------------------------
(in thousands, except per
share data) December 31, 2024 September 30, 2024
------------------------------ ------------------- --------------------
Investment portfolio, at fair
value(1) $ 1,819,870 $ 1,752,726
Total debt outstanding(2) $ 1,117,344 $ 1,069,844
Net assets $ 820,810 $ 839,190
Net asset value per share $ 15.43 $ 15.73
Debt-to-equity 1.36x 1.28x
Net debt-to-equity 1.27x 1.18x
Three Months Ended
-------------------------------------------
(in thousands, except
share and per share data) December 31, 2024 September 30, 2024
-------------------------- ------------------- ----------------------
Total investment income $ 57,894 $ 59,627
Total operating expenses
and income tax expense $ 39,208 $ 38,009
Net investment income after
taxes $ 18,686 $ 21,618
Net realized (losses) gains $ (2,238) $ 3,938
Net unrealized losses $ (10,990) $ (25,935)
Net increase (decrease) in
net assets resulting from
operations $ 5,458 $ (379)
Net investment income per
share $ 0.35 $ 0.40
Net realized and unrealized
losses per share $ (0.25) $ (0.41)
Earnings per share $ 0.10 $ (0.01)
Weighted average shares
outstanding 53,268,577 53,439,316
Distributions declared per
share $ 0.41 $ 0.36
Total investment income for the three months ended December 31, 2024 and September 30, 2024 was $57.9 million and $59.6 million, respectively. The decrease in total investment income was primarily driven by lower SOFR rates on our investments during the three months ended December 31, 2024 as compared to the three months ended September 30, 2024.
Operating expenses for the three months ended December 31, 2024 and September 30, 2024 were $39.2 million and $38.0 million, respectively. The increase in operating expenses was driven by higher interest expense due to an increase in the Company's total debt outstanding during the quarter ended December 31, 2024, partially offset by lower advisory fees paid to CIM due to a decrease in investment income during the quarter ended December 31, 2024 as compared to the quarter ended September 30, 2024.
PORTFOLIO AND INVESTMENT ACTIVITY(1)
A summary of the Company's investment activity for the three months ended December 31, 2024 is as follows:
New Investment
Commitments Sales and Repayments
----------------------- ------------------------
$ in % $ in %
Investment Type Thousands of Total Thousands of Total
------------------ ------------ --------- ------------- ---------
Senior secured
first lien debt $ 101,784 96% $ 47,637 99%
Collateralized
securities and
structured
products - equity 2,002 2% 25 --
Equity 2,333 2% 627 1%
-------- --------- --- -------- ---------
Total $ 106,119 100% $ 48,289 100%
-------- --------- --- -------- ---------
During the three months ended December 31, 2024, new investment commitments were made across 5 new and 15 existing portfolio companies. During the same period, the Company received the full repayment on investments in 2 portfolio companies and wrote-off the remaining investment in 1 portfolio company. As a result, the number of portfolio companies increased from 103 as of September 30, 2024 to 105 as of December 31, 2024.
PORTFOLIO SUMMARY(1)
As of December 31, 2024, the Company's investments consisted of the following:
Investments at Fair Value
-----------------------------
$ in %
Investment Type Thousands of Total
------------------------------------------ ---------------- -----------
Senior secured first lien debt $ 1,563,256 86.0%
Senior secured second lien debt 2,680 0.1%
Collateralized securities and structured
products - equity 2,682 0.1%
Unsecured debt 11,814 0.6%
Equity 239,438 13.2%
------------ -----------
Total $ 1,819,870 100.0%
------------ -----------
The following table presents certain selected information regarding the Company's investments:
As of
-------------------------------------
December 31, 2024 September 30, 2024
----------------- ------------------
Number of portfolio companies 105 103
Percentage of performing loans
bearing a floating rate(3) 93.8% 94.3%
Percentage of performing loans
bearing a fixed rate(3) 6.2% 5.7%
Yield on debt and other income
producing investments at amortized
cost(4) 12.28% 12.23%
Yield on performing loans at
amortized cost(4) 12.74% 12.73%
Yield on total investments at
amortized cost 10.96% 10.88%
Weighted average leverage (net
debt/EBITDA)(5) 5.02x 5.02x
Weighted average interest
coverage(5) 2.07x 2.14x
Median EBITDA(6) $34.2 million $32.8 million
As of December 31, 2024, investments on non-accrual status represented 1.41% and 3.22% of the total investment portfolio at fair value and amortized cost, respectively. As of September 30, 2024, investments on non-accrual status represented 1.85% and 3.40% of the total investment portfolio at fair value and amortized cost, respectively.
LIQUIDITY AND CAPITAL RESOURCES
As of December 31, 2024, the Company had $1,117 million of total principal amount of debt outstanding, comprised of $425 million of outstanding borrowings under its senior secured credit facilities and $692 million of unsecured notes and term loans. The combined weighted average interest rate on debt outstanding was 7.8% for the quarter ended December 31, 2024. As of December 31, 2024, the Company had $76 million in cash and short-term investments and $131 million available under its financing arrangements.(2)
EARNINGS CONFERENCE CALL
CION will host an earnings conference call on Thursday, March 13, 2025 at 11:00 am Eastern Time to discuss its financial results for the fourth quarter and year ended December 31, 2024. Please visit the Investor Resources - Earnings Presentation section of the Company's website at www.cionbdc.com for a slide presentation that complements the earnings conference call.
All interested parties are invited to participate via telephone or listen via the live webcast, which can be accessed by clicking the following link: CION Investment Corporation Fourth Quarter and Year End Conference Call. Domestic callers can access the conference call by dialing (877) 484-6065. International callers can access the conference call by dialing +1 (201) 689-8846. All callers are asked to dial in approximately 10 minutes prior to the call. An archived replay will be available on a webcast link located in the Investor Resources - Earnings Call section of CION's website.
ENDNOTES
1) The discussion of the investment portfolio excludes short-term
investments.
2) Total debt outstanding excludes netting of debt issuance costs of $18.2
million and $14.9 million as of December 31, 2024 and September 30,
2024, respectively.
3) The fixed versus floating composition has been calculated as a
percentage of performing debt investments measured on a fair value
basis, including income producing preferred stock investments and
excludes investments, if any, on non-accrual status.
4) Computed based on the (a) annual actual interest rate or yield earned
plus amortization of fees and discounts on the performing debt and other
income producing investments as of the reporting date, divided by (b)
the total performing debt and other income producing investments
(excluding investments on non-accrual status) at amortized cost. This
calculation excludes exit fees that are receivable upon repayment of the
investment.
5) For a particular portfolio company, the Company calculates the level of
contractual indebtedness net of cash ("net debt") owed by the portfolio
company and compares that amount to measures of cash flow available to
service the net debt. To calculate net debt, the Company includes debt
that is both senior and pari passu to the tranche of debt owned by it
but excludes debt that is legally and contractually subordinated in
ranking to the debt owned by the Company. The Company believes this
calculation method assists in describing the risk of its portfolio
investments, as it takes into consideration contractual rights of
repayment of the tranche of debt owned by the Company relative to other
senior and junior creditors of a portfolio company. The Company
typically calculates cash flow available for debt service at a portfolio
company by taking EBITDA for the trailing twelve-month period. Weighted
average net debt to EBITDA is weighted based on the fair value of the
Company's performing debt investments and excluding investments where
net debt to EBITDA may not be the appropriate measure of credit risk,
such as cash collateralized loans and investments that are underwritten
and covenanted based on recurring revenue.
For a particular portfolio company, the Company also calculates the
level of contractual interest expense owed by the portfolio company and
compares that amount to EBITDA ("interest coverage ratio"). The Company
believes this calculation method assists in describing the risk of its
portfolio investments, as it takes into consideration contractual
interest obligations of the portfolio company. Weighted average interest
coverage is weighted based on the fair value of the Company's performing
debt investments, and excludes investments where interest coverage may
not be the appropriate measure of credit risk, such as cash
collateralized loans and investments that are underwritten and
covenanted based on recurring revenue.
Portfolio company statistics, including EBITDA, are derived from the
financial statements most recently provided to the Company for each
portfolio company as of the reported end date. Statistics of the
portfolio companies have not been independently verified by the Company
and may reflect a normalized or adjusted amount.
6) Median EBITDA is calculated based on the portfolio company's EBITDA as
of the Company's initial investment.
C ON Investment Corporation
Consolidated Balance Sheets
(in thousands, except share and per share amounts)
December 31, 2024 September 30, 2024
------------------- ----------------------
(unaudited)
Assets
Investments, at fair
value:
Non-controlled,
non-affiliated
investments (amortized
cost of $1,489,777 and
$1,421,998,
respectively) $ 1,448,107 $ 1,381,177
Non-controlled,
affiliated investments
(amortized cost of
$274,642 and $276,204,
respectively) 269,205 273,152
Controlled investments
(amortized cost of
$179,274 and $152,042,
respectively) 171,376 151,900
-------------- ---------------
Total investments, at
fair value
(amortized cost of
$1,943,693 and
$1,850,244,
respectively) 1,888,688 1,806,229
Cash 7,670 29,765
Interest receivable on
investments 45,140 49,446
Receivable due on
investments sold and
repaid 2,965 28,604
Dividends receivable on
investments -- 76
Prepaid expenses and other
assets 1,265 1,501
-------------- ---------------
Total assets $ 1,945,728 $ 1,915,621
============== ===============
Liabilities and Shareholders' Equity
Liabilities
Financing arrangements (net
of unamortized debt
issuance costs of $18,156
and $14,925,
respectively) $ 1,099,187 $ 1,054,919
Payable for investments
purchased 1,019 --
Accounts payable and
accrued expenses 1,034 1,316
Interest payable 8,244 7,201
Accrued management fees 6,761 6,854
Accrued subordinated
incentive fee on income 3,964 4,586
Accrued administrative
services expense 2,006 1,515
Share repurchases payable 40 40
Shareholder distribution
payable 2,663 --
-------------- ---------------
Total liabilities 1,124,918 1,076,431
-------------- ---------------
Shareholders' Equity
Common stock, $0.001 par
value; 500,000,000 shares
authorized; 53,192,808
and
53,363,245 shares
issued, and 53,189,269
and 53,359,886 shares
outstanding,
respectively 53 53
Capital in excess of par
value 1,021,684 1,023,687
Accumulated distributable
losses (200,927) (184,550)
-------------- ---------------
Total shareholders'
equity 820,810 839,190
-------------- ---------------
Total liabilities and
shareholders' equity $ 1,945,728 $ 1,915,621
============== ===============
Net asset value per share
of common stock at end of
period $ 15.43 $ 15.73
--------------------------- ============== ===============
C ON Investment Corporation
Consolidated Statements of Operations
(in thousands, except share and per share amounts)
Three Months Ended Year Ended
December 31, December 31,
-------------------------- ----------------------------
2024 2023 2024 2023
---------- ---------- ---------- ----------
(unaudited) (unaudited)
Investment income
Non-controlled,
non-affiliated
investments
Interest income $ 31,289 $ 43,096 $ 165,786 $ 184,013
Paid-in-kind
interest income 11,586 6,581 31,397 22,317
Fee income 3,754 3,127 9,865 7,871
Dividend income 371 128 5,855 210
Non-controlled,
affiliated
investments
Paid-in-kind
interest income 2,810 2,419 11,692 8,372
Interest income 2,095 1,519 6,426 7,068
Dividend income 282 -- 411 3,946
Fee income 50 -- 3,648 2,432
Controlled
investments
Interest income 3,584 2,786 12,970 8,090
Dividend income -- -- -- 4,250
Paid-in-kind
interest income -- 2 -- 1,050
Fee income 2,073 341 4,382 1,391
---------- ---------- ---------- ----------
Total investment
income 57,894 59,999 252,432 251,010
---------- ---------- ---------- ----------
Operating expenses
Management fees 6,762 6,893 27,321 26,856
Administrative
services expense 1,261 1,228 4,783 3,971
Subordinated
incentive fee on
income 3,963 4,615 20,334 22,277
General and
administrative 1,859 1,422 7,157 7,382
Interest expense 25,244 24,023 96,870 85,556
---------- ---------- ---------- ----------
Total operating
expenses 39,089 38,181 156,465 146,042
---------- ---------- ---------- ----------
Net investment
income before
taxes 18,805 21,818 95,967 104,968
---------- ---------- ---------- ----------
Income tax expense
(benefit),
including excise
tax 119 60 107 (54)
---------- ---------- ---------- ----------
Net investment
income after
taxes 18,686 21,758 95,860 105,022
---------- ---------- ---------- ----------
Realized and
unrealized (losses)
gains
Net realized losses
on:
Non-controlled,
non-affiliated
investments (5,383) (351) (24,367) (31,927)
Non-controlled,
affiliated
investments 3,145 -- (3,946) --
Controlled
investments -- -- -- --
---------- ---------- ---------- ----------
Net realized losses (2,238) (351) (28,313) (31,927)
Net change in unrealized
(depreciation) appreciation on:
Non-controlled,
non-affiliated
investments 1,124 7,050 (8,218) 15,658
Non-controlled,
affiliated
investments (4,358) 1,801 5,059 (7,335)
Controlled
investments (7,756) 20,734 (30,486) 13,896
---------- ---------- ---------- ----------
Net change in
unrealized
(depreciation)
appreciation (10,990) 29,585 (33,645) 22,219
Net realized and
unrealized (losses)
gains (13,228) 29,234 (61,958) (9,708)
---------- ---------- ---------- ----------
Net increase in net
assets resulting
from operations $ 5,458 $ 50,992 $ 33,902 $ 95,314
========== ========== ========== ==========
Per share
information--basic
and diluted
Net increase in net
assets per share
resulting from
operations $ 0.10 $ 0.94 $ 0.63 $ 1.74
========== ========== ========== ==========
Net investment
income per share $ 0.35 $ 0.40 $ 1.79 $ 1.92
========== ========== ========== ==========
Weighted average
shares of common
stock outstanding 53,268,577 54,292,065 53,564,788 54,685,327
========== ========== ========== ==========
ABOUT CION INVESTMENT CORPORATION
CION Investment Corporation is a leading publicly listed business development company that had approximately $1.9 billion in total assets as of December 31, 2024. CION seeks to generate current income and, to a lesser extent, capital appreciation for investors by focusing primarily on senior secured loans to U.S. middle-market companies. CION is advised by CION Investment Management, LLC, a registered investment adviser and an affiliate of CION. For more information, please visit www.cionbdc.com.
FORWARD-LOOKING STATEMENTS
This press release may contain forward-looking statements that involve substantial risks and uncertainties. You can identify these statements by the use of forward-looking terminology such as "may," "will," "should, " "expect," "anticipate," "project," "target," "estimate," "intend," "continue," or "believe" or the negatives thereof or other variations thereon or comparable terminology. You should read statements that contain these words carefully because they discuss CION's plans, strategies, prospects and expectations concerning its business, operating results, financial condition and other similar matters. These statements represent CION's belief regarding future events that, by their nature, are uncertain and outside of CION's control. There are likely to be events in the future, however, that CION is not able to predict accurately or control. Any forward-looking statement made by CION in this press release speaks only as of the date on which it is made. Factors or events that could cause CION's actual results to differ, possibly materially from its expectations, include, but are not limited to, the risks, uncertainties and other factors CION identifies in the sections entitled "Risk Factors" and "Forward-Looking Statements" in filings CION makes with the SEC, and it is not possible for CION to predict or identify all of them. CION undertakes no obligation to update or revise publicly any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law.
OTHER INFORMATION
The information in this press release is summary information only and should be read in conjunction with CION's Annual Report on Form 10-K, which CION filed with the SEC on March 13, 2025, as well as CION's other reports filed with the SEC. A copy of CION's Annual Report on Form 10-K and CION's other reports filed with the SEC can be found on CION's website at www.cionbdc.com and the SEC's website at www.sec.gov.
View source version on businesswire.com: https://www.businesswire.com/news/home/20250313921164/en/
CONTACT: Media
Susan Armstrong
sarmstrong@cioninvestments.com
Investor Relations
Charlie Arestia
carestia@cioninvestments.com
(646) 253-8259
(END) Dow Jones Newswires
March 13, 2025 08:00 ET (12:00 GMT)
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