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WhiteHorse Finance Announces Fourth Quarter and Full Year 2024 Earnings Results

WhiteHorse Finance, Inc. recently released its financial results for the fourth quarter and full year of 2024, showcasing noteworthy developments and insights into its operational performance. The company, trading on Nasdaq as WHF, declared a dividend distribution of $0.385 per share, applicable for the quarter ending December 31, 2024, with payments scheduled for April 4, 2025, to stockholders recorded by March 21, 2025.

Financial Overview

Stuart Aronson, CEO of WhiteHorse Finance, addressed the financial outcomes, stating that although the fourth quarter results were notably impacted by specific challenges in their investment portfolio, the company remains steadfast in optimizing outcomes for the affected credits. Despite hurdles, Aronson noted that a considerable portion of their portfolio continues to perform well, indicating solid underlying stability.

The strategic emphasis on a well-managed portfolio, primarily in the non-sponsored market, aims to target better risk-adjusted returns amidst reduced competition. WhiteHorse’s disciplined underwriting process prioritizes investments with robust fundamentals, positioning the company to maneuver effectively through current market changes and to generate value for its shareholders.

Key Financial Metrics

As of December 31, 2024, WhiteHorse Finance reported the following financial metrics compared to the previous quarter (September 30, 2024):

• - Total Investment Income: $21.0 million (down 8.1% from $22.85 million)
• - Total Expenses: $13.0 million (down 4.9% from $13.7 million)
• - Net Investment Income: $8.0 million, translating to $0.343 per share (a decrease of 12.9% from $0.394 per share)
• - Distributions per Share: Consistent at $0.385

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The net realized losses for the quarter were significant, totaling $12.3 million, contrasting sharply with a net unrealized appreciation of $8.2 million during the same time.

Portfolio Insights

WhiteHorse’s investment portfolio had a fair market value of $642.2 million, reflecting a slight decline from $654.3 million as of the end of September. The portfolio presented a mix of 127 positions across 71 companies, achieving a weighted average effective yield of 12.5% on income-producing debt investments. Most holdings are based in first lien secured loans (approximately 78.2%) with variable rates primarily indexed to the Secured Overnight Financing Rate (SOFR).

Throughout the fourth quarter, WhiteHorse Finance actively engaged in adding value to its investment portfolio, contributing a total of $27.4 million to six new portfolio companies, alongside $8.0 million to existing firms. There was also a notable influx from proceeds totaling $32.5 million from sales and repayments during this period.

Distributed Returns

In terms of dividends, WhiteHorse Finance announced the upcoming payout of $0.385 per share, reflecting a consistent trend with declared distributions exceeding $0.355 for forty-nine consecutive quarters since the company’s IPO. Notably, a special distribution of $0.245 per share was also declared and paid late last year, marking another highlight in its shareholder return initiatives.

The tax implications of these distributions, which might include returns of capital and capital gains, will be reported to shareholders, ensuring transparency throughout their investment journey.

Looking Ahead

Investors can participate in a conference call to discuss the complete fourth quarter results, which will take place at 2:00 PM ET on March 7, 2025. The teleconference will be accessible via domestic and international lines with provisions for a replay post-meeting.

WhiteHorse Finance continues to hold a solid position in the lending landscape for privately owned, lower-middle market firms, continually seeking to invest strategically while delivering tangible rewards to their stakeholders. For those interested in exploring more about WhiteHorse and its operations, further information can be found on their official website.