Aug 13, 2026 earnings call — NAV recovery and portfolio repositioning
EIC's NAV rose to $12.52 per share, a 4% increase from $11.99.
Revenue $-0.0B (est $0.0B) · EPS $0.85 (est $0.33)
Key quotes
"The improvement in NAV was driven by a meaningful recovery in loan prices and CLO valuations following the volatility experienced in the first quarter."
"We also repositioned the portfolio by rotating capital away from a certain group of underperforming CLO collateral managers towards higher conviction opportunities across CLOs and other private credit investments."
"During the second quarter, we issued $1 million of our 6% Series AA convertible perpetual preferred stock."
Analyst Q&A 2
Why cash payouts fell and buyback plans
Q (Erik Zwick · Lucid): He asked why recurring cash distributions dropped — market factors or portfolio performance — and what would make them grow again. He also asked for an update on share repurchases and about stronger CLO trading volume and its impact.
A: Management said income from the CLO debt portion should likely increase over the next few months as base rates rise. They said the recent decrease was mainly driven by the CLO equity portion, where spread compression and coupon resets reduced cash flows, and that semiannual bond payments can make one quarter low and the next higher. On buybacks they said they are balancing the share discount against daily trading liquidity, they backed off because repurchases affected volume, and leverage is below target while the revolver is undrawn.
"Our expectation is that the cash -- at least the income from the CLO debt portion of the portfolio will likely increase over the next few months as, kind of, base rates increase." — Daniel Ko
Low leverage and plan to raise it
Q (Timothy D'Agostino · B. Riley): He asked why leverage is about 12% now and how the company plans to get back to the 25%–35% target. He also asked how EIC’s "other investments" sleeve compares to ECC’s.
A: They said they retired their most expensive preferreds earlier this year, including an 8% EICC, because those did not make sense versus CLO opportunities. They have started issuing EIC AA and AB convertible perpetual preferreds at 6% and expect that issuance to continue over the next several quarters; the revolver is undrawn but drawing it would also increase leverage. On other investments they said EIC’s other bucket is similar to ECC’s with a good amount of overlap, though EIC is smaller and thus less concentrated, and they expect many overlapping positions over time.
"We have started a program of issuing, kind of, the EIC AA and AB, which are the convertible perpetual preferreds at 6%, which we do find very, very attractive." — Daniel Ko