The business development company’s earnings rose sharply after integrating SWK Holdings, boosting income above its $0.33 base dividend.
Runway Growth Finance reported second-quarter net investment income of $18.2 million, or $0.43 per share, up from $10.6 million in the prior quarter. The increase follows the April acquisition of SWK Holdings, which expanded the portfolio to $1.2 billion and added $0.05 per share to quarterly income.
Net realized losses totaled $45.3 million, driven by markdowns on Marley Spoon and Blueshift, though management noted much of the impact was previously reflected in unrealized losses. Portfolio credit quality improved, with 94% of investments rated category 3 or better and an average risk rating of 2.34.
Shares traded at a 49% discount to net asset value, prompting ongoing repurchases and a commitment from BC Partners affiliates to buy up to 10% of outstanding shares. The company declared a $0.33-per-share third-quarter distribution and named Mike Rovner as co-CEO.