PennantPark Investment Corp. 10-Q: Portfolio Investments Detailed

TL;DR

PNNT 10-Q shows diverse debt/equity investments in portfolio companies like Tower Arch & Crane 1. Maturities out to 2027.

AI Summary

PennantPark Investment Corp. (PNNT) filed its 10-Q for the period ending June 30, 2024. The filing details investments in non-controlled, non-affiliated portfolio companies, including equity interests and first lien secured debt. Notable investments include Tower Arch Infolinks Media, LP, and Crane 1 Services, Inc., with specific debt instruments and maturity dates like December 29, 2026, for Applied Technical Services, LLC.

Why It Matters

This filing provides insight into PennantPark's investment strategy and the performance of its portfolio companies, which directly impacts shareholder value.

Risk Assessment

Risk Level: medium — The company's performance is tied to the success of its portfolio companies, which carry inherent credit and market risks.

Key Numbers

• 165.4% — Common Equity/Partnership Interests/Warrants (Percentage of investments in non-controlled, non-affiliated portfolio companies)
• 173.9% — First Lien Secured Debt (Percentage of investments in non-controlled, non-affiliated portfolio companies)
• 10.19% — Current Coupon (Crane 1 Services, Inc. debt)
• 11.25% — Current Coupon (Applied Technical Services, LLC debt)

Key Players & Entities

• PennantPark Investment Corp. (company) — Filer of the 10-Q
• June 30, 2024 (date) — End of reporting period
• Tower Arch Infolinks Media, LP (company) — Portfolio company with equity investment
• Crane 1 Services, Inc. (company) — Portfolio company with secured debt
• Applied Technical Services, LLC (company) — Portfolio company with secured debt
• December 29, 2026 (date) — Maturity date for Applied Technical Services, LLC debt
• August 16, 2027 (date) — Maturity date for Crane 1 Services, Inc. revolver

FAQ

Key Financial Figures

• $0.001 — ch Registered Common Stock, par value $0.001 per share PNNT The New York Stock E

Filing Documents

• pnnt-20240630.htm (10-Q) — 13092KB
• pnnt-ex3_2.htm (EX-3.2) — 16KB
• pnnt-ex10_1.htm (EX-10.1) — 58KB
• pnnt-ex10_2.htm (EX-10.2) — 44KB
• pnnt-ex10_5.htm (EX-10.5) — 1528KB
• pnnt-ex31_1.htm (EX-31.1) — 14KB
• pnnt-ex31_2.htm (EX-31.2) — 13KB
• pnnt-ex32_1.htm (EX-32.1) — 7KB
• pnnt-ex32_2.htm (EX-32.2) — 7KB
• 0000950170-24-092751.txt ( ) — 50755KB
• pnnt-20240630.xsd (EX-101.SCH) — 1590KB
• pnnt-20240630_htm.xml (XML) — 11534KB

CONSOLIDATED FINANCIAL INFORMATION

PART I. CONSOLIDATED FINANCIAL INFORMATION

Consolidated Financial Statements

Item 1. Consolidated Financial Statements Consolidated Statements of Assets and Liabilities as of June 30, 2024 (unaudited) and September 30, 2023 4 Consolidated Statements of Operations for the three and nine months ended June 30, 2024 and 2023 (unaudited) 5 Consolidated Statements of Changes in Net Assets for the three and nine months ended June 30, 2024 and 2023 (unaudited) 6 Consolidated Statements of Cash Flows for the nine months ended June 30, 2024 and 2023 (unaudited) 7 Consolidated Schedules of Investments as of June 30, 2024 (unaudited) and September 30, 2023 8

Notes to Consolidated Financial Statements (unaudited)

Notes to Consolidated Financial Statements (unaudited) 23 Report of Independent Registered Public Accounting Firm (PCAOB ID 49) 42

Management's Discussion and Analysis of Financial Condition and Results of Operations

Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations 44

Quantitative and Qualitative Disclosures About Market Risk

Item 3. Quantitative and Qualitative Disclosures About Market Risk 58

Controls and Procedures

Item 4. Controls and Procedures 59

OTHER INFORMATION

PART II. OTHER INFORMATION

Legal Proceedings

Item 1. Legal Proceedings 60

Risk Factors

Item 1A. Risk Factors 60

Unregistered Sales of Equity Securities and Use of Proceeds

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds 60

Defaults Upon Senior Securities

Item 3. Defaults Upon Senior Securities 60

Mine Safety Disclosures

Item 4. Mine Safety Disclosures 60

Other Information

Item 5. Other Information 60

Exhibits

Item 6. Exhibits 61

—CONSOLIDATED F INANCIAL INFORMATION

PART I—CONSOLIDATED F INANCIAL INFORMATION We are filing this Quarterly Report on Form 10-Q (the "Report"), in compliance with Rule 13a-13 as promulgated by the Securities and Exchange Commission, or the SEC, under the Securities Exchange Act of 1934, as amended, or the Exchange Act. In this Report, except where context suggest otherwise, the terms "Company," "we," "our" or "us" refers to PennantPark Investment Corporation and its consolidated subsidiaries; "PennantPark Investment" refers to only PennantPark Investment Corporation; "our SBIC Fund" refers collectively to our consolidated subsidiaries, PennantPark SBIC II LP, or SBIC II, and its general partner, PennantPark SBIC GP II, LLC; "Funding I" refers to PennantPark Investment Funding I, LLC, a wholly-owned subsidiary prior to deconsolidation on July 31, 2020; "Taxable Subsidiary" refers collectively to our consolidated subsidiaries, PNNT Investment Holdings II, LLC and PNNT Investment Holdings, LLC; "PSLF" refers to PennantPark Senior Loan Fund, LLC, an unconsolidated joint venture; "PTSF II" refers to PennantPark-TSO Senior Loan Fund II, LP, an unconsolidated limited partnership; "PennantPark Investment Advisers" or "Investment Adviser" refers to PennantPark Investment Advisers, LLC; "PennantPark Investment Administration" or "Administrator" refers to PennantPark Investment Administration, LLC; "SBA" refers to the Small Business Administration; "SBIC" refers to a small business investment company under the Small Business Investment Act of 1958, as amended; "BNP Credit Facility" refers to our revolving credit facility with BNP Paribas prior to deconsolidation of Funding I; "Truist Credit Facility" refers to our multi-currency, senior secured revolving credit facility with Truist Bank, as amended and restated; "2026 Notes" refers to our 4.50% Notes due May 2026; "2026 Notes-2" refers to our 4.00% Notes due November 2026; "BDC" refers to a business development company under the Investment Company Act of 1940,

Consolidated Financial Statements

Item 1. Consolidated Financial Statements PENNANTPARK INVESTMENT CORPORATION AND SUBSIDIARIES CONSOLIDATED STATEMENTS O F ASSETS AND LIABILITIES (In thousands, except share and per share data) June 30, 2024 September 30, 2023 (unaudited) Assets Investments at fair value Non-controlled, non-affiliated investments (amortized cost—$ 854,364 and $ 816,754 , respectively) $ 854,027 $ 830,808 Non-controlled, affiliated investments (amortized cost—$ 56,193 and $ 55,787 , respectively) 33,274 54,771 Controlled, affiliated investments (amortized cost—$ 342,429 and $ 245,386 , respectively) 372,574 216,068 Total investments (amortized cost—$ 1,252,986 and $ 1,117,927 , respectively) 1,259,875 1,101,647 Cash and cash equivalents (cost—$ 59,151 and $ 38,784 , respectively) 59,152 38,775 Interest receivable 5,568 6,820 Distribution receivable 7,964 5,079 Due from affiliates 139 — Prepaid expenses and other assets — 4,656 Total assets 1,332,698 1,156,977 Liabilities Truist Credit Facility payable, at fair value (cost—$ 450,456 and $ 212,420 , respectively) 446,554 206,940 2026 Notes payable, net (par— $ 150,000 ) 148,345 147,669 2026 Notes-2 payable, net (par— $ 165,000 ) 162,866 162,226 Payable for investment purchased 64,551 99,949 Distributions payable 5,224 13,697 Base management fee payable 4,216 3,915 Incentive fee payable 3,345 3,310 Accounts payable and accrued expenses 3,218 6,754 Interest payable on debt 3,124 6,231 Due to affiliates 33 4,099 Total liabilities 841,476 654,790 Commitments and contingencies (See Note 11) Net assets Common stock, 65,296,094 and 65,224,500 shares issued and outstanding, respectively Par value $ 0.001 per share and 100,000,000 shares authorized 65 65 Paid-in capital in excess of par value 746,768 746,466 Accumulated deficit ( 255,611 ) ( 244,344 ) Total net assets $

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