Saratoga Investment Corp (NYSE:SAR) stock rose% (As on January 9, 7:31:50 AM UTC-4, Source: Google Finance) after the company posted better than expected results for the third quarter of FY 25. AUM as of November 30, 2024, was $960.1 million, a decrease of 13.8% from $1.114 billion as of November 30, 2023, and a decrease of 7.7% from $1.041 billion as of last quarter. Total investment income for the three months ended November 30, 2024, was $35.9 million, a decrease of $0.4 million, or 1.3%, from $36.3 million in the three months ended November 30, 2023, and $7.1 million, or 16.6%, as compared to $43.0 million for the quarter ended August 31, 2024. This quarter’s investment income decrease as compared to the previous quarter was primarily due to the impact of the non-recurring Knowland interest reserve reversal of $7.9 million, that was previously on non-accrual status, following the investment’s full repayment, including accrued interest, being recognized last quarter, offset by the final interest of $0.3 million received this quarter. Adjusted NII for the quarter ended November 30, 2024, was $12.4 million, a decrease of $0.7 million, or 5.3%, from $13.1 million in the period ended November 30, 2023, and a decrease of $5.8 million, or 31.7%, from $18.2 million in the prior quarter. As of November 30, 2024, Saratoga Investment had a combined $52.5 million in outstanding combined borrowings under its $65.0 million senior secured revolving credit facility with Encina and its $75.0 million senior secured revolving credit facility with Live Oak.

Moreover, adjusted for the incentive fee accrual related to net capital gains, the NII Yield was also 13.3%. In comparison, adjusted NII Yield was 14.6% for the quarter ended November 30, 2023, and 19.7% for the quarter ended August 31, 2024. NAV was $374.9 million as of November 30, 2024, an increase of $15.3 million from $359.6 million as of November 30, 2023, and an increase of $2.8 million from $372.1 million as of August 31, 2024. Fair value of Saratoga Investment’s portfolio was $960.1 million, excluding $250.2 million in cash and cash equivalents, principally invested in 48 portfolio companies, one collateralized loan obligation fund (the “CLO”) and one joint venture fund (the “JV”).

SAR in the third quarter of FY 25 has reported the adjusted earnings per share of 90 cents, beating the analysts’ estimates for the adjusted earnings per share of 84 cents. The company had reported the adjusted revenue of $35.88 million in the third quarter of FY 25, beating the analysts’ estimates for revenue of $35.26 million.