Hercules Capital (NYSE: HTGC) reported Q1 EPS of $0.37, $0.01 better than the analyst estimate of $0.36.

Q1 2020 Financial Achievements and Highlights

• Record Net Investment Income “NII” of $40.6 million, or $0.37 per share, an increase of 39.8% year-over-year
  • Provides 116% coverage of base distribution payout
• Record Total Investment Income of $73.6 million, an increase of 25.2% year-over-year
• $438.2 million of available liquidity, subject to existing terms and covenants
• New debt and equity commitments of $256.8 million
  • Total gross fundings of $233.6 million
• Unscheduled early principal repayments or “early loan repayments” of $150.5 million
• 15.6% Return on Average Equity “ROAE” (NII/Average Equity)
• 7.2% Return on Average Assets “ROAA” (NII/Average Assets)
• GAAP leverage of 116.8% and regulatory leverage of 106.7%(2)
• Net Asset Value “NAV” decreased to $9.92 from $10.55, down 6.0% from Q4 2019
• 13.6% GAAP Effective Yield and 11.8% Core Yield(3), a non-GAAP measure

“Our Q1 2020 earnings generated significant NII which covers 116% of our base shareholder distribution,” stated Scott Bluestein, chief executive officer and chief investment officer of Hercules. “During the quarter, we continued to support new and existing portfolio companies through total commitments of $256.8 million and completed several strategic balance sheet activities which strengthened our liquidity to $438.2 million. In addition, we generated core yields within management’s targeted range of 11.5 to 12.5 percent—reflecting the 150 basis points of Fed Funds cuts—maintained solid credit quality combined with prudent portfolio management, and modestly grew the debt investment portfolio to $2.24 billion at cost. Fortunately, our performance during the quarter puts us in a favorable position as we enter Q2 and the ongoing uncertainty brought about by the coronavirus situation.”

Bluestein added, “As we vigilantly monitor the evolving health situation and economic impact associated with the COVID-19 pandemic, our priorities remain squarely focused on keeping our employees safe, supporting our portfolio companies, and protecting the interests of all our stakeholders, all while managing the continuity of our business. Our seasoned group of investment and credit professionals will continue to communicate frequently with our portfolio companies which are highly diversified and backed by some of the most well-established venture capital and private equity sponsors in U.S. With an enhanced financial position, record undistributed earnings spillover and no near-term maturities, we will adhere to our strict credit-centric investment discipline with a focus on long-term shareholder value.”

For earnings history and earnings-related data on Hercules Capital (HTGC) click here.