Solar Senior Capital Ltd. (NASDAQ:SUNS) Q1 2019 Earnings Conference Call - Final Transcript
May 07, 2019 • 11:00 am ET
compares to a net asset value of $261.4 million or $16.30 per share at December 31, 2018. Solar Senior's balance sheet, investment portfolio at March 31, 2019 had a fair market value of $467.7 million in 49 portfolio companies, operating in 21 industries compared to a fair market value of $450.1 million in 47 portfolio companies operating in 20 industries at December 31, 2018. At March 31, 2019, SUNS' net leverage increased to 0.78 times debt-to-equity from 0.63 times at December 31, 2018. Solar Senior's target leverage is 1.25 times to 1.5 times debt-to-equity under reduced asset coverage requirement.
From a P&L perspective, gross investment income for the three months ended March 31, 2019, totaled $10.2 million versus $10.0 million for the three months ended December 31, 2018. Net expenses for the three months ended March 31, 2019, were $4.6 million compared to $4.4 million for the three months ended December 31, 2018. Net investment income for the quarter ended March 31, 2019, was $5.7 million or $0.35 per average share as compared to $5.6 million or $0.35 per average share for the three months ended December 31.
Below the line, Solar Senior had a net realized and unrealized gain for the first fiscal quarter totaling $1.7 million compared to a net realized and unrealized loss of $8.2 million for the three months ended December 31. Accordingly, Solar Senior had a net increase in net assets resulting from operations of $7.4 million or $0.46 per average share for the three months ended March 31, 2019. This compares to a net decrease in net assets resulting from operations of $2.6 million or $0.16 per average share for the three months ended December 31, 2018. Lastly, our Board of Directors declared a monthly distribution for May 2019 of $0.1175 per share payable on June 4, 2019 to stockholders of record on May 23, 2019.
At this time, I'd like to turn the call over to our Chief Operating Officer, Bruce Spohler.
Thank you, Rich. As Michael highlighted, our intention is to expand our portfolio by investing in our three core investment strategies. First lien senior secured cash flow loans to upper mid-market sponsor-owned companies, first lien asset-based loans secured by accounts receivable to mid-sized companies, which operate exclusively in the healthcare sector through our Gemino holdings portfolio company and lastly, first lien asset-based loans and factoring facilities secured by accounts receivable to mid-sized companies that operate primarily in manufacturing services and distribution industries through our North Mill subsidiary. In addition, we are actively evaluating opportunities to further expand our specialty finance business lines.
Now let me turn to the portfolio. In the aggregate, at quarter end, our investments across our three business lines totaled just under $600 million, encompassing a 162 issuers. The portfolio is highly diversified with an average investment of approximately $3.7 million or 0.6% of the comprehensive portfolio. Measured at fair value, 98% of the portfolio consists of senior secured loans, of which 59% are in first lien cash