Eagle Point Income Company's Q2 GAAP EPS Misses Expectations

Eagle Point Income Company reported Q2 GAAP NII of $0.39, missing the expected $0.43. NAV per common share decreased to $14.08 as of June 30, 2022, from $14.16 as of March 31, 2022. The company's GAAP net income for the quarter was $0.39 per share, compared to the expected $0.43.

Eagle Point Credit Company Inc. (ECC) announced its second-quarter 2025 financial results, highlighting a mixed performance with some notable strategic moves. The company reported a GAAP net income (NII) of $0.23 per weighted average common share, falling short of the expected $0.33. Despite this, the company's net asset value (NAV) per common share remained robust at $7.31 as of June 30, 2025, compared to $7.23 at the end of March 2025 [1].

The company's CEO, Thomas P. Majewski, emphasized the strategic acquisitions made during the quarter, noting that discounted CLO equity investments were secured to enhance long-term returns. Additionally, the company's recurring cash flows from its investment portfolio remained strong, comfortably exceeding distributions and operating expenses. However, the company did experience realized losses from forward currency contracts and investments, which were partially offset by unrealized gains on non-U.S. dollar-denominated investments [1].

ECC deployed $86.1 million in gross capital into various investments, including CLO equity, CLO debt, and loan accumulation facilities. The weighted average effective yield of new CLO equity investments was 17.3%, while the weighted average expected yield of the CLO equity portfolio was 18.81%. These investments are expected to generate recurring revenue for the company [1].

The company also issued approximately 5.3 million shares of common stock and 1.6 million shares of Series AA and 69,040 shares of Series AB 7.00% Convertible Perpetual Preferred Stock, raising a total of $40.7 million and $37.6 million, respectively. These offerings resulted in a $0.02 per share NAV accretion and a $0.03 per share NAV accretion, respectively [1].

Looking ahead, ECC plans to maintain strong recurring cash flows and deploy capital opportunistically to enhance net investment income. The company is also focused on lengthening its weighted average remaining reinvestment period. For the third quarter, the company is expected to have a NAV per common share range of $7.44 to $7.54 as of July 31, 2025 [1].

In summary, while ECC's Q2 2025 results fell short of expectations, the company's strategic moves and strong recurring cash flows provide a solid foundation for future growth. Investors should closely monitor the company's ongoing activities and future financial performance.

References:
[1] https://www.businesswire.com/news/home/20250812686888/en/Eagle-Point-Credit-Company-Inc.-Announces-Second-Quarter-2025-Financial-Results-and-Declares-Fourth-Quarter-2025-Common-and-Preferred-Distributions