SuRo Capital (SSSS) Q2 2024 earnings summary

Executive summary

• Net asset value (NAV) per share declined to $6.94 as of June 30, 2024, from $7.17 in Q1 and $7.35 in Q2 2023, with total net assets at $162.3M and 23.4M shares outstanding.

• $10M was invested in Canva and $15M in CoreWeave (CW Opportunity 2 LP), both seen as strategic for future IPO opportunities.

• The board approved a $35M note repurchase program and a $75M convertible note program (6.5% due 2029), with an initial $25M tranche.

• 2M shares (7.9% of outstanding) were repurchased at $4.70 per share via Dutch auction, reducing share count and net asset value.

• Top five portfolio positions accounted for 49% of portfolio fair value, with 39 companies (35 private, 4 public) in the portfolio.

Financial highlights

• Net assets fell to $162.3M from $203.4M at year-end 2023, with NAV per share down 13% year-to-date.

• Net investment loss for Q2 was $3.7M ($0.16/share), and net change in unrealized depreciation was $7.0M ($0.30/share).

• Net decrease in net assets from operations was $10.7M ($0.45/share) for Q2 2024.

• Cash available for investment was $54.4M, representing 22% of gross assets.

• Liquid assets at quarter-end totaled $57.6M, including $54.4M cash and $3.2M in unrestricted public securities.

Outlook and guidance

• Management expects the IPO market to ramp up in late Q3 2024, with several high-profile companies potentially going public.

• Portfolio is positioned to benefit from reopening of the IPO window and continued AI sector growth.

• Ample liquidity is maintained to support near-term capital requirements, with $54.4M in cash and $63.8M in U.S. Treasury bills at quarter-end.

• Management remains optimistic about the investment pipeline, with $55M in investable capital.

• Focus remains on equity-based investments in high-growth, venture-backed companies across key themes like AI, marketplaces, and fintech.