CHICAGO--(BUSINESS WIRE)--March 05, 2026--
OFS Credit Company, Inc. (Nasdaq: OCCI, OCCIO, OCCIN, OCCIM) ("OFS Credit," the "Company," "we," "us" or "our"), an investment company that primarily invests in collateralized loan obligation ("CLO") equity and debt securities, today announced its financial results for the fiscal quarter ended January 31, 2026.
FIRST QUARTER HIGHLIGHTS
-- Net investment income ("NII") of $5.5 million, or $0.19 per common
share, for the fiscal quarter ended January 31, 2026. This compares to
NII of $6.2 million, or $0.22 per common share, for the fiscal quarter
ended October 31, 2025. NII decreased for the fiscal quarter ended
January 31, 2026, primarily due to a decrease in the interest income
yield1 on our investment portfolio. See additional information under
"Results of Operations" below.
-- Core net investment income ("Core NII")2 of $9.1 million, or $0.32 per
common share, for the fiscal quarter ended January 31, 2026. This
compares to Core NII of $8.8 million, or $0.32 per common share, for the
fiscal quarter ended October 31, 2025. Core NII increased for the fiscal
quarter ended January 31, 2026, due to a modest increase in recurring CLO
equity investment cashflows, while Core NII per common share was stable.
See additional information under "Supplemental Information Regarding Core
Net Investment Income" below.
-- Net asset value ("NAV") per common share of $4.36 at January 31, 2026,
a decrease of $1.10 from NAV of $5.46 at October 31, 2025. The decrease
in NAV was primarily due to a net loss on investments of $0.96 per common
share and distributions of $0.345 per common share paid during the
quarter which exceeded our quarterly NII of $0.19 per common share. See
additional information under "Results of Operations" below.
-- During the fiscal quarter ended January 31, 2026, the interest income
yield1 of our investment portfolio was 13.16%, based on average amortized
cost.
-- During the fiscal quarter ended January 31, 2026, we issued 825,444
shares of common stock through our At-the-Market offering, for net
proceeds of $4.1 million, after deducting commissions, fees and offering
costs.
OTHER RECENT EVENTS
-- On February 18, 2026, we caused notice to be issued to the holder of
the Series D Term Preferred Stock regarding the exercise of our option to
fully redeem the $3.0 million of issued and outstanding Series D Term
Preferred Stock on February 27, 2026. On February 27, 2026, all
outstanding shares of the Series D Term Preferred Stock were redeemed at
100% of their principal amount ($25 per share). In accordance with the
provisions of the Certificate of Designation of the Series D Term
Preferred Stock, dividends declared on the Series D Term Preferred Stock
for the month of February 2026 were paid on the February 27, 2026 to the
holder of record of the Series D Term Preferred Stock at the close of
business on the record date, and were not paid as part of the redemption
price.
-- On February 19, 2026, we caused notices to be issued to the holders of
the Series C Term Preferred Stock regarding the exercise of our option to
partially redeem $5.0 million of the issued and outstanding Series C Term
Preferred Stock on March 31, 2025. The Series C Term Preferred Stock will
be redeemed at 100% of their principal amount ($25 per share). In
accordance with the provisions of the Certificate of Designation of the
Series C Term Preferred Stock, dividends declared on the Series C
Preferred Shares for the month of March 2026 shall be paid on the
dividend payment date to the holders of record of the Series C Term
Preferred Stock at the close of business on the record date, and shall
not be payable as part of the redemption price.
-- As previously announced, on February 23, 2026, our board of directors
(the "Board") declared monthly cash distributions of $0.05 per common
share for the months of March and April 2026, which implies an annualized
cash distribution rate of 18.9% based on the closing market price of
$3.17 per common share on the declaration date. See additional
information under "Distributions" below.
SELECTED FINANCIAL HIGHLIGHTS
(in millions, except per
share data) At
------------------------------------------
January 31, 2026 October 31, 2025
-------------------- --------------------
Balance Sheet Highlights
Total investments, at fair
value $ 235.9 $ 256.5
Total outstanding preferred
stock - principal 115.9 115.9
Total net assets 126.8 153.0
NAV per common share 4.36 5.46
Asset coverage ratio(3) 209.4% 232.0%
Operating Highlights For the Fiscal Quarter Ended
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(Per common share) January 31, 2026 October 31, 2025
------------------------ --------------------
Net investment income $ 0.19 $ 0.22
Net realized loss on
investments (0.02) (0.03)
Net change in unrealized
depreciation on
investments (0.94) (0.52)
---- -------------- ------------
Net earnings (loss) $ (0.77) $ (0.33)
---- -------------- ------------
Reconciliation of Core
NII -- Non-GAAP(1)
Net investment income $ 0.19 $ 0.22
CLO equity adjustments 0.13 0.10
---- -------------- ------------
Core NII $ 0.32 $ 0.32
==== ============== ============
MANAGEMENT COMMENTARY
"Amid the ongoing market volatility in CLO equity, we remain focused on prudently positioning our balance sheet and taking actions to preserve capital, including our recent announcement to reduce our monthly common stock distribution rate," said Bilal Rashid, Chief Executive Officer. "We continue to proactively manage our portfolio, evaluating accretive reset and refinancing transactions, and we maintained our weighted average remaining reinvestment period at 3.4 years at quarter end. In addition, we continued to selectively deploy capital in what we believe are attractive risk-adjusted return opportunities, which carried a weighted average yield of 16.51% at quarter end."
PORTFOLIO AND INVESTMENT ACTIVITIES
As of January 31, 2026, the total fair value of our investment portfolio was $235.9 million, which was equal to 71.2% of amortized cost. For the quarter ended January 31, 2026, our CLO equity cash flow yield(4) was 17.40% based on amortized cost.
At
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Portfolio Overview ($ in
millions) January 31, 2026 October 31, 2025
----------------------------- -------------------- --------------------
Total investments, at fair
value $ 235.9 $ 256.5
Total number of issuers 85 85
Weighted-average effective
yield(5) 12.39% 13.02%
For the Fiscal Quarter Ended
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Portfolio Purchases ($ in
millions) January 31, 2026 October 31, 2025
------------------------- ------------------------ --------------------
CLO equity investments $ 12.0 $ 4.0
CLO debt investments -- --
Loan accumulation facility
investments 3.1 3.5
Other CLO equity-related
investments (i.e., fee
rebates) -- --
--- ------------ ----- ---------- ----
Total investments $ 15.1 $ 7.5
--- ------------ ----- ---------- ----
Weighted-average effective
yield - period end 16.51% 15.48%
At January 31, 2026
--------------------------------
Portfolio Composition ($ in millions) Amortized Cost Fair Value
------------------------------------- ---------------- --------------
CLO equity investments $ 318.5 $ 222.5
CLO debt investments 0.1 0.1
Loan accumulation facility investments 11.5 11.5
Other CLO equity-related investments
(i.e., fee rebates) 1.3 1.8
--- ----------- --------
Total investments $ 331.4 $ 235.9
--- ----------- --------
RESULTS OF OPERATIONS
Interest Income
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