Gladstone Investment (GAIN) investor relations material

Executive summary

• Net investment income for Q1 2026 was $15.9 million ($0.40 per share), a significant turnaround from a net investment loss of $10.6 million in the prior quarter, driven by higher interest and success fee income.

• Adjusted net investment income per share rose to $0.26, covering monthly dividends, with total portfolio fair value reaching $1.3 billion.

• Portfolio consists of 29 companies valued at $1.3 billion as of June 30, 2026, with 70.6% in debt and 29.4% in equity investments at cost.

• Entered agreements to acquire Extrude Hone and DHE Computer Systems, and made an add-on acquisition for Global GRAB Technologies.

• Sale agreement for SFEG Holdings expected to generate full repayment and significant capital gain upon closing.

Financial highlights

• Total investment income increased to $28.4 million, up 20.4% year-over-year and 12.6% quarter-over-quarter.

• Adjusted NII rose to $10.4 million ($0.26 per share) from $7.9 million ($0.20 per share) sequentially.

• Net expenses declined to $12.4 million, mainly due to reversal of $5.6 million in accrued capital gains-based incentive fees.

• Net assets decreased to $646.8 million, with NAV per share falling to $16.24 from $16.78.

• Realized and unrealized losses totaled $27.8 million, primarily from a $9.0 million realized loss on a loan restructuring and $18.8 million in net unrealized depreciation.

Outlook and guidance

• Management anticipates continued strong earnings and distributions, supported by a robust investment pipeline and strong liquidity.

• Board declared monthly distributions of $0.08 per share for July–September 2026.

• Expectation of modest increase in portfolio yield due to new investments with higher interest rate floors.

• Plan to continue supplemental distributions as capital gains are realized from portfolio exits.

• Cautious outlook due to macroeconomic factors such as energy prices, supply chain risks, tariffs, and market volatility.