HIGHLIGHTS Year ended September 30, 2025($ in millions, except per share amounts)
Assets and Liabilities:
Investment portfolio (1)
$
1,287.3
Net assets
$
464.0
Net asset value per share
$
7.11
Quarterly change in net asset value per share
(3.4
)%
Credit Facility
$
425.5
2026 Notes, net of unamortized deferred financing costs
$
149.5
2026-2 Notes, net of unamortized deferred financing costs
$
163.9
Regulatory debt to equity
1.60
x
Weighted average yield on debt investments
11.0
%
Quarter Ended
Year Ended
September 30, 2025
September 30, 2025
Operating Results:
Net investment income
$
9,832
$
46,051
Net investment income per share
$
0.15
$
0.71
Core net investment income per share (2)
$
0.15
$
0.71
Distributions declared per share
$
0.24
$
0.96
Portfolio Activity:
Purchases of investments (3)
$
186.4
$
746.6
Sales and repayments of investments (3)
$
61.4
$
810.4
PSLF Portfolio data:
PSLF investment portfolio
$
1,265.9
$
1,265.9
Purchases of investments
$
0.4
$
546.1
Sales and repayments of investments
$
65.0
$
293.8
Includes investments in PennantPark Senior Loan Fund, LLC ("PSLF"), an unconsolidated joint venture, totaling $207.8 million, at fair value.
Core net investment income ("Core NII") is a non-GAAP financial measure. The Company believes that Core NII provides useful information to investors and management because it reflects the Company's financial performance excluding one-time or non-recurring investment income and expenses. The presentation of this additional information is not meant to be considered in isolation or as a substitute for financial results prepared in accordance with GAAP. For the quarter ended September 30, 2025, there were no one-time events resulting in $0.15 of Core NII. For the year ended September 30, 2025, Core NII excluded: i) $0.3 million of credit facility amendment cost, and ii) $0.1 million of incentive fee expense offset.
Excludes U.S. Government Securities.
CONFERENCE CALL AT 12:00 P.M. EST ON NOVEMBER 25, 2025
PennantPark Investment Corporation ("we," "our," "us" or the "Company") will also host a conference call at 12:00 p.m. (Eastern Time) on Tuesday, November 25, 2025 to discuss its financial results. All interested parties are welcome to participate. You can access the conference call by dialing toll-free (800) 330-6710 approximately 5-10 minutes prior to the call. International callers should dial (646) 769-9200. All callers should reference conference ID #7198155 or PennantPark Investment Corporation. An archived replay will also be available on a webcast link located on the Quarterly Earnings page in the Investor section of PennantPark's website.
PORTFOLIO AND INVESTMENT ACTIVITY
"The credit quality of our investment portfolio continues to perform well and we remain confident in the continued resilience of the portfolio, supported by our disciplined focus on the core middle market. Investments in the core middle market typically feature attractive credit spreads, lower leverage, and enhanced lender protections relative to the upper middle market." said Art Penn, Chief Executive Officer. "We remain highly focused on creating realizations of our equity holdings and utilizing that capital to support our NII. We will continue to utilize our spillover income, which is estimated at 73 cents per share, to supplement shortfalls in our dividend coverage," added Mr. Penn.
As of September 30, 2025, our portfolio totaled $1,287.3 million and consisted of $582.4 million or 45% of first lien secured debt, $124.8 million or 10% of U.S. Government Securities, $18.2 million or 1% of second lien secured debt, $201.2 million or 16% of subordinated debt (including $140.3 million or 11% in PSLF) and $360.7 million or 28% of preferred and common equity (including $67.5 million or 5% in PSLF). Our interest bearing debt portfolio consisted of 91% variable-rate investments and 9% fixed-rate investments. As of September 30, 2025, we had four portfolio companies on non-accrual, representing 1.3% and 0.1% percent of our overall portfolio on a cost and fair value basis, respectively. Overall, the portfolio had net unrealized appreciation of $50.4 million as of September 30, 2025. Our overall portfolio consisted of 166 companies with an average investment size of $7.0 million (excluding U.S. Government Securities), had a weighted average yield on interest bearing debt investments of 11.0%.
As of September 30, 2024, our portfolio totaled $1,328.1 million and consisted of $667.9 million or 50% of first lien secured debt, $99.6 million or 8% of U.S. Government Securities, $67.2 million or 5% of second lien secured debt, $181.7 million or 14% of subordinated debt (including $115.9 million or 9% in PSLF) and $311.7 million or 23% of preferred and common equity (including $67.9 million or 5% in PSLF). Our interest bearing debt portfolio consisted of 94% variable-rate investments and 6% fixed-rate investments. As of September 30, 2024, we had two portfolio companies on non-accrual, representing 4.1% and 2.3% of our overall portfolio on a cost and fair value basis, respectively. Overall, the portfolio had net unrealized appreciation of $11.2 million as of September 30, 2024. Our overall portfolio consisted of 152 companies with an average investment size of $8.1 million (excluding U.S. Government Securities), had a weighted average yield on interest bearing debt investments of 12.3%.
For the three months ended September 30, 2025, we invested $186.4 million in nine new and 54 existing portfolio companies at a weighted average yield on debt investments of 9.3% (excluding U.S. Government Securities). For the three months ended September 30, 2025, sales and repayments of investments totaled $61.4 million (excluding U.S. Government Securities), including zero sales to PSLF. For the year ended September 30, 2025, we invested $746.6 million of investments in 28 new and 161 existing portfolio companies with a weighted average yield on debt investments of 10.2% (excluding U.S. Government Securities). Sales and repayments of investments for the same period totaled $810.4 million (excluding U.S. Government Securities), including $462.8 million of sales to PSLF.
For the three months ended September 30, 2024, we invested $191.9 million in 12 new and 44 existing portfolio companies at a weighted average yield on debt investments of 11.4% (excluding U.S. Government Securities). For the three months ended September 30, 2024, sales and repayments of investments totaled $175.3 million (excluding U.S. Government Securities), including $117.0 million of sales to PSLF. For the year ended September 30, 2024, we invested $774.6 million of investments in 41 new and 81 existing portfolio companies with a weighted average yield on debt investments of 11.7% (excluding U.S. Government Securities). Sales and repayments of investments for the same period totaled $555.4 million (excluding U.S. Government Securities), including $308.8 million of sales to PSLF.
PennantPark Senior Loan Fund, LLC
As of September 30, 2025, PSLF's portfolio totaled $1,265.9 million, consisted of 109 companies with an average investment size of $11.6 million and had a weighted average yield interest bearing debt investments of 10.1%.
As of September 30, 2024, PSLF's portfolio totaled $1,031.2 million, consisted of 102 companies with an average investment size of $10.1 million and had a weighted average yield on debt investments of 11.3%.
For the three months ended September 30, 2025, PSLF invested $0.4 million (including zero purchased from the Company) in zero new and one existing portfolio companies at a weighted average yield on debt investments of 13.2%. PSLF's sales and repayments of investments for the same period totaled $65.0 million. For the year ended September 30, 2025, PSLF invested $546.1 million (of which $462.8 million was purchased from the Company) in 26 new and 57 existing portfolio companies with a weighted average yield on debt investments of 10.4%. PSLF's sales and repayments of investments for the same period totaled $293.8 million.
For the three months ended September 30, 2024, PSLF invested $145.9 million (including $117.0 million purchased from the Company) in three new and seven existing portfolio companies at a weighted average yield on debt investments of 11.5%. PSLF's sales and repayments of investments for the same period totaled $39.1 million. For the year ended September 30, 2024, PSLF invested $396.1 million (of which $308.8 million was purchased from the Company) in 20 new and 24 existing portfolio companies with a weighted average yield on debt investments of 11.8%. PSLF's sales and repayments of investments for the same period totaled $172.9 million.
In July 2025, PSLF through its wholly-owned and consolidated subsidiary, PennantPark CLO VII, LLC ("CLO VII") closed the partial refinancing of its $300 million debt securitization. The $21.0 million of Class B Loans interest was decreased from SOFR plus 4.05% to SOFR plus 1.95%, the $24.0 million of Class C Loans interest was decreased from SOFR plus 4.70% to SOFR plus 2.30% and the $18.0 million of Class D Loans interest was decreased from SOFR plus 7.00% to SOFR plus 3.35%. As a result of this refinancing, the weighted average cost of capital went from SOFR plus 3.31% to SOFR plus 2.63%.
RESULTS OF OPERATIONS
Set forth below are the results of operations for the three months ended and years ended September 30, 2025 and 2024.
Investment Income
For the three months and year ended September 30, 2025, investment income was $28.0 million and $122.4 million, respectively, which was attributable to $21.0 million and $89.8 million from first lien secured debt, $0.4 million and $3.8 million from second lien secured debt, $1.2 million and $4.4 million from subordinated debt and $5.4 million and $24.3 million from other investments, respectively. For the three months and year ended September 30, 2024, investment income was $36.5 million and $143.8 million, respectively, which was attributable to $27.2 million and $104.8 million from first lien secured debt, $2.2 million and $9.8 million from second lien secured debt, $1.1 million and $3.0 million from subordinated debt and $6.0 million and $26.2 million from other investments, respectively. The decrease in investment income compared to prior year was primarily due to a decrease in our total portfolio including a decrease in our weighted average yield on debt investment and a decrease in dividend income.
Expenses
For the three months and year ended September 30, 2025, expenses totaled $18.1 million and $76.3 million, respectively, and were comprised of $10.0 million and $41.6 million of debt related interest and expenses, $4.0 million and $16.2 million of base management fees, $2.1 million and $9.8 million of incentive fees, $1.3 million and $6.1 million of general and administrative expenses and $0.7 million and $2.6 million of provision for excise taxes. For the three months and year ended September 30, 2024, expenses totaled $22.0 million and $83.7 million, respectively, and were comprised of $12.3 million and $45.2 million of debt related interest and expenses, $4.3 million and $16.7 million of base management fees, $3.1 million and $12.7 million of incentive fees, $1.8 million and $6.6 million of general and administrative expenses and $0.7 million and $2.6 million of provision for excise taxes. The decrease in expenses over the prior year was primarily due to decrease in interest and expenses on debt and a decrease in incentive fees.
Net Investment Income
For the three months and year ended September 30, 2025, net investment income totaled $9.8 million and $46.1 million, or $0.15 per share and $0.71 per share, respectively. For the three months and year ended September 30, 2024, net investment income totaled $14.4 million and $60.1 million, or $0.22 per share and $0.92 per share, respectively. The decrease in net investment income was primarily due to a decrease in investment income and partially offset by a decrease in expenses.
Net Realized Gains or Losses
For the three months and year ended September 30, 2025, net realized gains (losses) totaled $(21.6) million and $(52.4) million, respectively. For the three months and year ended September 30, 2024, net realized gains (losses) totaled $2.5 million and $(33.6) million, respectively. The change in realized gains/losses was primarily due to changes in market conditions of our investments and the values at which they were realized and the fluctuations in the market and in the economy.
Unrealized Appreciation or Depreciation on Investments and Debt
For the three months ended and year ended September 30, 2025, net change in unrealized appreciation (depreciation) on investments was $9.9 million and $39.2 million, respectively. For the three months ended and year ended September 30, 2024, net change in unrealized appreciation (depreciation) on investments was $4.3 million and $26.8 million, respectively. As of September 30, 2025 and 2024, our net unrealized appreciation (depreciation) on investments totaled $50.4 million and $11.2 million, respectively. The net change in unrealized appreciation on our investments for the year ended September 30, 2025 was primarily due to changes in the capital market conditions of our investments and the values at which they were realized and the fluctuation in the market and in the economy.
For the three months and year ended September 30, 2025, our Credit Facility had a net change in unrealized appreciation (depreciation) of $0.9 million and $(0.1) million, respectively. For the three months and year ended September 30, 2024, our Credit Facility had a net change in unrealized appreciation (depreciation) of $(2.8) million and $(4.4) million, respectively. As of September 30, 2025 and September 30, 2024, the net unrealized appreciation (depreciation) on the Credit Facility totaled $(1.0) million and $(1.1) million, respectively. The net change in unrealized appreciation (depreciation) for the year ended September 30, 2025 compared to the same periods in their prior periods was primarily due to changes in the capital markets.
Net Change in Net Assets Resulting from Operations
For the three months and year ended September 30, 2025, net increase (decrease) in net assets resulting from ...
