Hercules Capital (HTGC) investor relations material

Executive summary

• Achieved record Q1 2026 originations and new commitments of $1.81 billion, with total investment income reaching $141.5 million, up 18.4% year-over-year, and net investment income at $88.1 million ($0.48 per share), a 13.8% increase year-over-year.

• Return on equity was 16.9% and return on assets was 8.1%, with a high-yield portfolio and net interest margin of 10.1%.

• Maintained robust liquidity, with over $1 billion available across the platform and $454.5 million in available liquidity at quarter-end.

• Portfolio is concentrated in technology and life sciences, with 98% of debt investments in floating rate loans and strong credit quality; only one loan on non-accrual.

• Leadership transition announced: Seth Meyer to become President, Andrew Olson appointed as CFO.

Financial highlights

• Total investment portfolio at cost grew to $4.77 billion, with debt investments at $4.56 billion and fair value at $4.54 billion.

• Net asset value per share decreased 1.9% to $11.90, mainly due to unrealized depreciation from market yield adjustments.

• Operating expenses rose, driven by compensation and business growth, totaling $58.1 million.

• Weighted average cost of debt was 5.1%; effective yield was 12.8%; core yield was 12.2%.

• Annualized loss rate remained low at 0.023%.

Outlook and guidance

• Expect Q2 2026 core yield to remain in the 12%-12.5% range, with $350 million-$500 million in prepayment activity anticipated, mainly from M&A events.

• SG&A expenses for Q2 projected at $27.5-$28.5 million; RIA dividend expected at $2-$2.5 million.

• Originations expected to moderate in Q2 and be more back-end weighted; management expects continued portfolio growth supported by strong liquidity.

• Focus remains on high-growth, venture-backed companies, with disciplined underwriting and high floating-rate exposure.