Quarter Ended 12/31/22 Highlights
- Total investment income of $2.0 million
- Net investment income of $1.4 million, or $0.23 per share
- Investment portfolio of $50.3 million at fair value
- Net asset value (“NAV”) per share increased to $13.91 on December 31, 2022 from $13.73 on September 30, 2022
Scott Gordon, Chairman and Chief Executive Officer of Silver Spike, commented, “We continue to build a robust portfolio of loans to the cannabis industry’s top operators, leveraging the platform’s deep industry network and knowledge base. As the cannabis industry moves through a challenging phase, we remain bullish on the long-term growth prospects of the industry and continue to see an abundant number of attractive loan opportunities. In January, we co-led and participated in a $35 million senior secured credit facility forMariMed,Inc. (“MariMed”),a premier seed-to-consumer vertically integrated multi-state cannabis operator, which will enable MariMed to fund its growth plans and be opportunistic in today’s environment.”
Conference Call
Silver Spike will host a conference call and webcast to discuss the Company’s fiscal year end 2022 financial results at8:00 a.m. Eastern Time onFriday, March 31, 2023. Participants may register for the callhere. A live webcast of the call will also be available on theCompany’swebsite atssic.silverspikecap.com.
The presentation to be used in connection with the conference call and webcast will be available at ssic.silverspikecap.com.
A replay of the call will be available atssic.silverspikecap.comby end of dayMarch 31, 2023.
Background
Silver Spike Investment Corp. is a closed-end, non-diversified management investment company that has elected to be regulated as a business development company under the Investment Company Act of 1940, as amended, and has elected to be treated as a regulated investment company for U.S. federal income tax purposes. On February 8, 2022, Silver Spike completed its initial public offering. Silver Spike is managed by Silver Spike Capital, LLC, an investment manager focused on the cannabis and alternative health and wellness industries.
Results of Operations
For the threemonths ended December31, 2022, total investment income was $2.0 million. This compares to total expenses of $0.6 million, resulting in net investment income of approximately $1.4 million, or $0.23 per share.
Silver Spike recorded a net unrealized loss of $0.3 million during the quarter ended December 31, 2022, primarily related to the fair valuation of our debt investments.
The Company generated a net increase in net assets from operations of $1.2 million, or $0.19 per share.
Net Asset Value
As of December31, 2022, NAV per share increased to $13.91, compared to $13.73 as of September 30, 2022. The increase in NAV per share was primarily driven by the results from operations. Total net assets as of December 31, 2022 were $86.5 million, compared to $85.3 million as of September 30, 2022.
Portfolio and Investment Activity
As of December31, 2022, Silver Spike’s investment portfolio had an aggregate fair value of approximately $50.3 million, comprising $40.7 million in secured loans in two portfolio companies and $9.6 million in secured notes in three portfolio companies.
During the quarter ended December 31, 2022, the Company made three investments. Subsequent to the quarter end, the Company made one additional investment on January 24, 2023.
As of the end of the quarter ended December 31, 2022, there were no loans on non-accrual status.
Liquidity and Capital Resources
At December31, 2022, the Company had $35.1 million in available liquidity, comprising $35.1 million in cash and cash equivalents.
About Silver Spike Investment Corp.
Silver Spike, a specialty finance company that has elected to be regulated as a business development company under the Investment Company Act of 1940, as amended, was formed to invest across the cannabis ecosystem through investments primarily in the form of direct loans to privately held cannabis companies. Silver Spike’s investment objective is to maximize risk-adjusted returns on equity for its shareholders by investing primarily in secured and unsecured debt in cannabis companies and other companies in the health and wellness sector. Silver Spike is managed by Silver Spike Capital, LLC, an investment manager focused on the cannabis and alternative health and wellness industries. For more information, please visit https://ssic.silverspikecap.com/.
Forward-Looking Statements
Certain information contained herein may constitute “forward-looking statements” that involve substantial risks and uncertainties. Such statements involve known and unknown risks, uncertainties and other factors and undue reliance should not be placed thereon. These forward-looking statements are not historical facts, but rather are based on current expectations, estimates and projections about the Company, its current and prospective portfolio investments, its industry, its beliefs and opinions, and its assumptions. Words such as “anticipates,” “expects,” “intends,” “plans,” “will,” “may,” “continue,” “believes,” “seeks,” “estimates,” “would,” “could,” “should,” “targets,” “projects,” “outlook,” “potential,” “predicts” and variations of these words and similar expressions are intended to identify forward-looking statements. These statements are not guarantees of future performance and are subject to risks, uncertainties and other factors, some of which are beyond the Company’s control and difficult to predict and could cause actual results to differ materially from those expressed or forecasted in the forward-looking statements including, without limitation, the risks, uncertainties and other factors identified in the Company’s filings with the SEC. Investors should not place undue reliance on these forward-looking statements, which apply only as of the date on which the Company makes them. The Company does not undertake any obligation to update or revise any forward-looking statements or any other information contained herein, except as required by applicable law.
Contacts
Investors:
Bill Healy
bill@silverspikecap.com
212-905-4933
Media:
Alan Oshiki and Sydney Gever
Abernathy MacGregor
Silverspikecapital@abmac.com
212-371-5999
SILVER SPIKE INVESTMENT CORP.
Statements of Assets and Liabilities
| December 31, 2022* | March 31, 2022 | |||||||
| ASSETS | ||||||||
| Investments at fair value: | ||||||||
| Non-control/non-affiliate investments at fair value (amortized cost of $50,529,690 and $0, respectively) | $ | 50,254,550 | $ | – | ||||
| Cash and cash equivalents | 35,125,320 | 84,766,060 | ||||||
| Interest receivable | 1,559,081 | 9,215 | ||||||
| Prepaid expenses | 32,323 | 256,512 | ||||||
| Due from affiliate | 2,049 | – | ||||||
| Total assets | $ | 86,973,323 | $ | 85,031,787 | ||||
| LIABILITIES | ||||||||
| Management fee payable | $ | 170,965 | $ | – | ||||
| Excise tax payable | 80,566 | – | ||||||
| Administrator fees payable | 57,306 | 47,151 | ||||||
| Audit fees payable | 50,000 | 50,000 | ||||||
| Legal fees payable | 44,301 | 33,983 | ||||||
| Director’s fee payable | 32,049 | 24,370 | ||||||
| Professional fees payable | 28,744 | – | ||||||
| Offering cost payable | – | 264,581 | ||||||
| Organizational costs payable | – | 34,168 | ||||||
| Due to affiliate | – | 85 | ||||||
| Other payables | 33,663 | 25,359 | ||||||
| Total liabilities | $ | 497,594 | $ | 479,697 | ||||
| Commitments and contingencies (Note 6) | – | – | ||||||
| NET ASSETS | ||||||||
| Common Stock, $0.01 par value, 100,000,000 shares authorized, 6,214,672 and 6,214,672 shares issued and outstanding | $ | 62,147 | $ | 62,147 | ||||
| Additional paid-in-capital | 84,917,788 | 84,917,788 | ||||||
| Distributable earnings/(Accumulated losses) | 1,495,794 | (427,845 | ) | |||||
| Total net assets | $ | 86,475,729 | $ | 84,552,090 | ||||
| NET ASSET VALUE PER SHARE | $ | 13.91 | $ | 13.61 | ||||
*On November 8, 2022, our Board of Directors approved a change in our fiscal year end from March 31 to December 31.
SILVER SPIKE INVESTMENT CORP.
Statements of Operations
| For the period from April 1, 2022 through December 31, 2022* | Year Ended March 31, 2022 | For the period from January 25, 2021 (Inception) through March 31, 2021 | ||||||||||
| INVESTMENT INCOME | ||||||||||||
| Non-control/non-affiliate investment income | ||||||||||||
| Interest income | $ | 3,628,585 | $ | 10,073 | $ | – | ||||||
| Fee income | 410,000 | – | – | |||||||||
| Total investment income | 4,038,585 | 10,073 | – | |||||||||
| EXPENSES | ||||||||||||
| Legal expenses | 484,412 | 34,069 | – | |||||||||
| Management fee | 336,432 | – | – | |||||||||
| Insurance expense | 228,288 | 46,488 | – | |||||||||
| Audit expense | 210,284 | 40,000 | 10,000 | |||||||||
| Administrator fees | 171,494 | 47,151 | – | |||||||||
| Director expenses | 99,845 | – | – | |||||||||
| Excise tax expense | 80,566 | – | – | |||||||||
| Professional fees | 70,264 | 34,920 | – | |||||||||
| Custodian fees | 36,150 | 36,000 | – | |||||||||
| Organizational expenses | – | 328,002 | 149,715 | |||||||||
| Other expenses | 122,071 | 6,808 | – | |||||||||
| Total expenses | 1,839,806 | 573,438 | 159,715 | |||||||||
| NET INVESTMENT INCOME (LOSS) | 2,198,779 | (563,365 | ) | (159,715 | ) | |||||||
| NET REALIZED GAIN (LOSS) FROM INVESTMENTS | – | – | – | |||||||||
| NET CHANGE IN UNREALIZED APPRECIATION (DEPRECIATION) ON INVESTMENTS | ||||||||||||
| Non-controlled/non-affiliate investments | (275,140 | ) | – | – | ||||||||
| Net change in unrealized appreciation/(depreciation) on investments | (275,140 | ) | – | – | ||||||||
| NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS | $ | 1,923,639 | $ | (563,365 | ) | $ | (159,715 | ) | ||||
| NET INVESTMENT INCOME (LOSS) PER SHARE – BASIC AND DILUTED | $ | 0.35 | $ | (0.64 | ) | $ | N/A | |||||
| NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS PER SHARE – BASIC AND DILUTED | $ | 0.31 | $ | (0.64 | ) | $ | N/A | |||||
| WEIGHTED AVERAGE SHARES OUTSTANDING – BASIC AND DILUTED | 6,214,672 | 877,409 | N/A | |||||||||
*On November 8, 2022, our Board of Directors approved a change in our fiscal year end from March 31 to December 31.
