Gladstone Investment (GAIN) Investor Day presentation summary

Company overview and objectives

• Founded in 2005 to invest in debt and equity of established lower middle market U.S. businesses, with 28 portfolio companies valued over $1.0B as of June 2025.

• Differentiated as a primary equity investor and lead sponsor in most transactions, providing both debt and equity capital, targeting a 25% equity and 75% debt mix per deal.

• Focuses on U.S. companies with EBITDA of $4–$15M, positive cash flow, and strong management, across manufacturing, business/consumer services, and consumer products.

• Evergreen fund structure allows long-term alignment and flexibility, with active board participation and portfolio management.

• Externally managed by an SEC-registered adviser with a dedicated team and a proven track record across economic cycles.

Financial highlights and shareholder value

• Net asset value per share grew from $9.00 in 2011 to $12.99 in June 2025, with a 7% annual growth rate.

• Investment income has grown at a 10% annual rate since 2011, driven by portfolio expansion and increased yields.

• Since inception, $565M in equity proceeds from exits, with a 4.0x cash-on-cash equity return and $424.4M in net realized gains and dividends.

• Regular annual distributions doubled from $0.48/share in FY11 to $0.96/share in FY26, with 240 consecutive monthly payments and frequent supplemental distributions.

• Outperformed BDC peers with 5- and 10-year total returns of 147% and 395%, and average ROE of 15% and 14% over 5 and 10 years, respectively.

Capital structure and risk management

• Maintains a conservative balance sheet with low leverage and a 190% asset coverage ratio, exceeding the 150% requirement.

• Uses long-term fixed-rate financing and opportunistic equity offerings, with $463.8M in publicly traded notes and a $270M credit facility.

• No third-party sponsor risk, as all capital is provided internally, enhancing certainty and speed of closing deals.

• Active risk management through board participation and strategic planning with portfolio companies.