CHICAGO, March 05, 2026 (GLOBE NEWSWIRE) -- Monroe Capital Corporation (NASDAQ: MRCC) today announced its financial results for the fourth quarter and full year ended December 31, 2025. The Board of Directors (the "Board") also declared its first quarter distribution of $0.09 per share, payable on March 31, 2026 to stockholders of record on March 16, 2026.

Except where the context suggests otherwise, the terms "Company," "we," "us," and "our" refer to Monroe Capital Corporation (together with its subsidiaries).

Fourth Quarter 2025 Financial Highlights

   -- Net Investment Income ("NII") of $2.2 million, or $0.10 per share 
 
   -- Adjusted Net Investment Income (a non-GAAP measure described below) of 
      $2.3 million, or $0.11 per share 
 
   -- Net increase (decrease) in net assets resulting from operations of $(2.6) 
      million, or $(0.12) per share 
 
   -- Net Asset Value ("NAV") of $166.5 million, or $7.68 per share 
 
   -- Paid quarterly dividend of $0.18 per share on December 31, 2025 

Full Year 2025 Financial Highlights

   -- NII of $11.4 million, or $0.53 per share 
 
   -- Adjusted Net Investment Income (a non-GAAP measure described below) of 
      $11.6 million, or $0.54 per share 
 
   -- Net increase (decrease) in net assets resulting from operations of $(5.1) 
      million, or $(0.24) per share 

Chief Executive Officer Theodore L. Koenig commented, "We look forward to the closing of MRCC's previously announced proposed merger with Horizon Technology Finance Corporation ("HRZN"), which we now anticipate to occur near the end of the first quarter or early in the second quarter of this year. We continue to strongly believe this merger is in the best interest of MRCC stockholders. We are also adjusting MRCC's dividend to better align distributions with MRCC's net investment income as a stand-alone entity, in part due to the decrease in base rates.

Mr. Koenig continued, "Looking ahead, we believe the NAV-for-NAV structure of the merger will unlock meaningful value for our stockholders and provide them with compelling long-term upside through participation in a larger, more scaled HRZN which stands to benefit from meaningful synergies and operating leverage as it continues to grow its portfolio with the additional equity capital from the merger. Among other things, we also expect that the larger combined company will have access to a wider array of debt funding solutions, including synergistic efficiencies and potential lower borrowing costs over time and higher dividend potential, as compared to the stand-alone MRCC."

Monroe Capital Corporation is a business development company affiliate of the award-winning private credit investment firm and lender, Monroe Capital LLC.

Management Commentary

Adjusted Net Investment Income totaled $2.3 million, or $0.11 per share for the quarter ended December 31, 2025, an increase from $1.9 million, or $0.09 per share for the quarter ended September 30, 2025. NAV decreased to $166.5 million or $7.68 per share as of December 31, 2025, compared to $173.0 million or $7.99 per share as of September 30, 2025. The decrease in NAV this quarter was primarily the result of the utilization of spillover income to support the fourth quarter dividend and net unrealized losses associated with certain portfolio companies. As of December 31, 2025, the Company has an estimated $0.14 per share in undistributed spillover income. Any undistributed spillover income will be distributed in conjunction with the proposed merger with HRZN.

At quarter end, the Company's debt-to-equity leverage decreased from 1.23 times debt-to-equity at September 30, 2025 to 1.15 times debt-to-equity at December 31, 2025. Weighted average leverage decreased to 1.15 times debt-to-equity for the quarter ended December 31, 2025, compared to 1.18 times debt-to-equity for the prior quarter ended September 30, 2025. The decline in weighted average leverage was primarily driven by the use of proceeds from sales, payoffs, and paydowns to reduce the average outstanding balance on the revolving credit facility.

 
Selected Financial Highlights 
 
(in thousands, except per share 
data) 
                                    December 31, 2025    September 30, 2025 
                                   -------------------  -------------------- 
Consolidated Statements of Assets 
and Liabilities data:                   (audited)           (unaudited) 
Investments, at fair value           $         334,855    $          360,650 
Total assets                         $         372,963    $          388,952 
Net assets                           $         166,490    $          173,038 
Net asset value per share            $            7.68    $             7.99 
 
 
                                          For the Quarters Ended 
                                 December 31, 2025      September 30, 2025 
                                                      ---------------------- 
Consolidated Statements of 
Operations data:                                (unaudited) 
Net investment income            $         2,212        $          1,813 
Adjusted net investment 
 income(1)                       $         2,288        $          1,883 
Net gain (loss)                  $        (4,858)       $         (2,950) 
Net increase (decrease) in 
 net assets resulting from 
 operations                      $        (2,646)       $         (1,137) 
 
Per share data: 
Net investment income            $          0.10        $           0.08 
Adjusted net investment 
 income(1)                       $          0.11        $           0.09 
Net gain (loss)                  $         (0.23)       $          (0.13) 
Net increase (decrease) in 
 net assets resulting from 
 operations                      $         (0.12)       $          (0.05) 
 

______________________________________________________________________

(1) See Non-GAAP Financial Measure -- Adjusted Net Investment Income below for a detailed description of this non-GAAP measure and a reconciliation from NII to Adjusted Net Investment Income. The Company uses this non-GAAP financial measure internally in analyzing financial results and believes that this non-GAAP financial measure is useful to investors as an additional tool to evaluate ongoing results and trends for the Company.

Portfolio Summary

 
                                 December 31, 2025      September 30, 2025 
                               ---------------------  ---------------------- 
                                     (audited)             (unaudited) 
Investments, at fair value      $       334,855        $        360,650 
Number of portfolio company 
 investments(1)                              87                      79 
Percentage portfolio company 
 investments on 
 non-accrual(2)                             4.0%                    3.5% 
Weighted average contractual 
 yield(3)                                   9.4%                    9.9% 
Weighted average effective 
 yield(3)                                   8.4%                    8.8% 
 
Asset class percentage at 
fair value: 
   First lien loans                        79.3%                   74.0% 
   Junior secured loans                    10.5%                    8.7% 
   Equity investments                      10.2%                   17.3% 
 

______________________________________________________________________

(1) 11 new portfolio company investments were acquired as a distribution-in-kind in connection with the wind-down of MRCC Senior Loan Fund I, LLC.

(2) Represents portfolio debt or preferred equity investments on non-accrual status as a percentage of total investments at fair value.

(3) Portfolio yield is calculated only on the portion of the portfolio that has a contractual coupon and therefore does not account for dividends on equity investments (other than preferred equity investments).

Financial Review

Results of Operations: Fourth Quarter 2025

The Company's NII for the quarter ended December 31, 2025 totaled $2.2 million, or $0.10 per share, compared to $1.8 million, or $0.08 per share, for the quarter ended September 30, 2025. Adjusted Net Investment Income was $2.3 million, or $0.11 per share, for the quarter ended December 31, 2025, compared to $1.9 million, or $0.09 per share, for the quarter ended September 30, 2025.

Total investment income was approximately $8.2 million for each of the quarters ended December 31, 2025 and September 30, 2025. During the quarter lower interest income as a result of base rate decreases and the decline in weighted average invested assets was offset by additional fee income.

Total expenses for the quarter ended December 31, 2025 were $5.9 million, compared to $6.4 million for the quarter ended September 30, 2025. Total expenses decreased by $0.5 million primarily due to a decline in interest expense as a result of lower weighted average outstanding debt on the Company's revolving credit facility, as well as reduced base management fees, reflecting a quarter-over-quarter decline in total assets.

Total net loss was $4.9 million for the quarter ended December 31, 2025, compared to $3.0 million for the quarter ended September 30, 2025. For the quarter ended December 31, 2025, the net loss was primarily driven by mark-to-market declines in certain portfolio companies still held in the portfolio.

While there were net mark-to-market losses on the portfolio during the quarter, asset quality has remained stable and with the completion of the liquidation during the quarter of MRCC's joint venture, MRCC Senior Loan Fund I, LLC ("SLF"), the Company's average portfolio mark increased by 1.4%, from 88.3% of amortized cost as of September 30, 2025 to 89.7% of amortized cost as of December 31, 2025.

Net increase (decrease) in net assets resulting from operations was $(2.6) million, or $(0.12) per share, for the quarter ended December 31, 2025, compared to $(1.1) million, or $(0.05) per share, for the quarter ended September 30, 2025.

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March 05, 2026 16:29 ET (21:29 GMT)