Executive Summary

Q1 2025 total investment income was $4.6M, down from $5.4M in Q4 2024 and $5.0M in Q1 2024; NII was $0.9M ($0.35/share), down from $1.5M ($0.56/share) in Q4 2024 but flat year over year .
NAV per share fell to $29.66 from $32.04 in Q4 2024, largely due to a $4.4M write-down on the legacy Sequoia Healthcare term loan; non‑accrual fair value exposure improved to 2.2% from 4.6% in Q4 2024 .
The company executed $15.1M of investments against $12.4M of repayments/sales (net deployment +$2.7M), continued rotating out of non‑yielding equity (equity at 10.8% of portfolio fair value), and declared a Q2 2025 dividend of $0.36/share; management urged a FOR vote on the Portman Ridge merger .
Key “why”: lower nonrecurring paydown/fee income, lower base rates, and timing of deployment vs repayments reduced investment income per share Q/Q; NAV pressure driven by Sequoia write‑down .
Near‑term catalysts: shareholder votes and merger terms (1.500 PTMN shares per LRFC share), dividend continuity, and continued equity portfolio monetization .

What Went Well and What Went Wrong

What Went Well

Portfolio rotation and monetization: “successful exit of [the] second largest non‑yielding equity investment in GA Communications,” reducing equity to 10.8% of fair value (from 13.8% in Q4 and 18.2% in Q1 2024) .
“This exit stands as another important achievement in our long-term strategy of rotating out of the legacy equity portfolio…” .
Net deployment of capital: $15.1M invested vs $12.4M repaid/sold, net +$2.7M in Q1, supporting earning power as equity mix declines .
Operating discipline: total operating expenses fell to $3.7M vs $4.1M in Q1 2024; CFO highlighted lower interest/financing, base management fees, and G&A vs Q4 .

What Went Wrong

Investment income down Q/Q: $4.6M vs $5.4M in Q4; per-share decline driven by lower nonrecurring paydown/fee income ($0.17/share), lower base rates ($0.05), deployment timing ($0.05), and lower CLO income ($0.02) .
NAV decline: NAV/share fell to $29.66 from $32.04, with CFO citing a $4.4M write-down on legacy Sequoia term loan (on non‑accrual since before 2021) .
Non‑accruals persist: three portfolio companies on non‑accrual (cost $17.2M; fair value $3.7M), and management does not expect meaningful recovery from Sequoia; Lucky Bucks remains non‑accrual .

Financial Results

Headline metrics vs prior periods

Metric	Q1 2024	Q3 2024	Q4 2024	Q1 2025
Total Investment Income ($USD Millions)	$5.003	$5.148	$5.4	$4.631
Total Expenses ($USD Millions)	$4.056	$4.153	$3.9	$3.703
Net Investment Income ($USD Millions)	$0.947	$0.995	$1.5	$0.928
NII Per Share ($USD)	$0.35	$0.37	$0.56	$0.35
Net Inc/(Dec) in Net Assets from Ops ($USD Millions)	$1.851	$(1.347)	N/A	$(5.370)
EPS – Net Assets from Ops Per Share ($USD)	$0.69 (basic)	$(0.50)	N/A	$(2.02) (basic)
NAV Per Share ($USD)	N/A	$32.31	$32.04	$29.66

Actuals vs Consensus (Q1 2025)

Metric	Q1 2025 Actual	Q1 2025 Consensus	Notes
Total Investment Income ($USD Millions)	$4.631	N/A	S&P Global consensus unavailable for LRFC (SPGI mapping missing)
NII Per Share ($USD)	$0.35	N/A	S&P Global consensus unavailable for LRFC (SPGI mapping missing)

Note: Wall Street consensus via S&P Global was unavailable for LRFC due to missing CIQ mapping; estimate comparisons are omitted.

Portfolio composition (fair value)

Asset Class	Dec 31, 2024 FV ($USD Millions)	Dec 31, 2024 % of Portfolio	Mar 31, 2025 FV ($USD Millions)	Mar 31, 2025 % of Portfolio
First Lien Debt	$111.460	64.7%	$114.600	67.6%
Second Lien Debt	$9.051	5.3%	$9.119	5.4%
Subordinated Debt	$22.858	13.3%	$23.040	13.6%
CLOs	$0.940	0.5%	$0.572	0.3%
Joint Venture	$4.153	2.4%	$3.948	2.3%
Equity	$23.828	13.8%	$18.334	10.8%
Total	$172.290	100.0%	$169.613	100.0%

KPIs and credit metrics

KPI	Q4 2024	Q1 2025
Debt investment portfolio (% of FV)	83.3%	86.6%
Weighted avg annualized debt yield (ex‑non‑accruals/CLOs)	10.7%	10.7%
Fixed‑rate portion of debt portfolio (% FV)	12.1%	9.3%
Non‑accruals – cost (% of portfolio)	9.0%	8.7%
Non‑accruals – FV (% of portfolio)	4.6%	2.2%
Asset coverage ratio (%)	179%	179.4%
Cash & cash equivalents ($USD Millions)	$15.0	$5.1
Portfolio companies (#)	59	59
Portfolio fair value ($USD Millions)	$172.3	$169.6
Net deployment ($USD Millions)	N/A	+$2.7

Guidance Changes

Metric	Period	Previous Guidance	Current Guidance	Change
Dividend per share	Q2 2025	$0.36 for Q1 2025	$0.36 (payable May 29, 2025)	Maintained
Merger consideration	On closing	N/A	1.500 PTMN shares per LRFC share	Announced

Note: No quantitative revenue/EPS/OpEx/tax guidance provided in Q1 2025 materials .

Earnings Call Themes & Trends

Topic	Previous Mentions (Q-2 and Q-1)	Current Period (Q1 2025)	Trend
Legacy equity rotation	Q3 2024: Exited largest equity position (Nth Degree) ; Q4 2024: GA Communications exit announced post‑quarter	GA Communications exit completed; equity reduced to 10.8% FV; CEO reiterates strategy	Improving (lower equity %)
Non‑accruals	Q3: 3 companies; FV 4.6% ; Q4: 4 debt investments across 3 cos.; FV 4.6%	3 companies; FV 2.2%; cost 8.7% ; limited recovery expected for Sequoia	Fair value exposure improving
Interest rates/yield	Q3: debt yield ~12.3% ; Q4: ~10.7%	~10.7%; CFO notes base rate decrease weighed on income	Muted/steady
Merger with Portman Ridge	Q4: merger terms outlined; Boards approved; shareholder vote pending	CEO “encourage shareholders to vote FOR” and cites scale/liquidity/efficiencies	Advancing toward vote
BC-sourced portfolio	Q4: 66.7% of FV	71.8% of FV BC‑originated	Increasing platform origination

Management Commentary

“Following record results in 2024, Logan Ridge continued to make significant strides in strengthening its portfolio… [and] successful exit of its second largest non‑yielding equity investment in GA Communications… [equity] reduced to just 10.8%… down from 13.8% [Q4] and 18.2% [Q1 2024].” – CEO Ted Goldthorpe .
“This transaction [Portman Ridge merger] offers the potential for increased scale, improved liquidity, and enhanced operational efficiencies… We encourage all shareholders to vote FOR the proposed merger…” – CEO .
“Investment income per share decline Q/Q was driven by: −$0.17 nonrecurring paydown/fee income, −$0.05 lower base rates, −$0.05 deployment timing, −$0.02 lower CLO income.” – CFO Brandon Satoren .
“NAV decline was largely due to the $4.4M write‑down on the company’s legacy investment in Sequoia.” – CFO .

Q&A Highlights

Valuation process and discount rates: portfolio marks use third‑party marks where applicable, liquid pricing, and internal models; management expects limited impact from credit spread changes given muted benchmark moves .
Non‑accrual recovery prospects: Sequoia is the largest non‑accrual and has been non‑accruing since before management’s tenure; management does not expect meaningful recovery or accrual resumption; Lucky Bucks remains on non‑accrual .
BC‑sourced portfolio quality: excluding Lucky Bucks, only one BC‑sourced name (Datalink) is marked below ~90 (high 80s); management will follow up with exact discount metrics .

Estimates Context

S&P Global/Capital IQ consensus estimates for LRFC were unavailable due to a missing CIQ mapping; therefore, comparisons to Street estimates are omitted. Management’s results should be assessed against internal drivers (nonrecurring income, base rates, deployment timing) rather than consensus this quarter .

Key Takeaways for Investors

Equity rotation is materially de‑risking the portfolio: equity FV down to 10.8%; continued exits should support NII stability and long‑term earnings power .
NAV headwind is concentrated in legacy Sequoia; with limited recovery expected, further NAV volatility should be more idiosyncratic rather than systemic if equity monetization continues .
Core credit metrics are stable: debt yield ~10.7%, asset coverage ~179%, non‑accrual FV reduced to 2.2%—supportive of dividend sustainability near term .
Merger vote is a principal catalyst: exchange ratio set at 1.500 PTMN shares per LRFC share; potential benefits include scale, liquidity, and operational efficiencies; monitor timing and shareholder approval outcomes .
Near‑term NII sensitivity: watch for nonrecurring income, base rate changes, and deployment pace vs repayments; CFO quantified Q/Q per‑share pressure drivers .
Liquidity and deployment capacity: cash of $5.1M and $31.5M unused borrowing capacity provide optionality to continue shifting into interest‑earning assets .
Dividend maintained at $0.36/share (Q2 2025); continuity supports income profile pending merger developments .

Logan Ridge Finance Corp. (LRFC)·Q1 2025 Earnings Summary