SLR Investment (SLRC) Financials

SLR Investment Corp. (NASDAQ: SLRC) shows a steady trend of profitability and stable operations over the last four years based on the analysis of quarterly financials from Q2 2022 to Q2 2025. The company primarily generates income through interest on investment securities and maintains a consistent dividend payout policy. Below are key insights derived from the income statements, cash flow statements, and balance sheets across this period.

• Consistent Net Income Growth: Net income improved from $6.8 million in Q1 2023 to $24.2 million in Q2 2025, with quarterly earnings per share (EPS) rising from $0.13 to $0.44, indicating profitable growth.
• Stable Net Interest Income: Net interest income remains relatively stable, with $35.4 million in Q2 2025 compared to $36.3 million in Q4 2024, showcasing steady core revenue generation from securities interest income.
• Controlled Operating Expenses: Salaries and employee benefits held steady around $5.4 million to $6.0 million, and total non-interest expenses remained stable around $13-14 million, indicating efficient cost management.
• Strong Dividend Payments: The company consistently paid dividends of approximately $22.3 million quarterly, supporting income investors and showing confidence in cash flow.
• Robust Cash Position: Cash and due from banks remained healthy, increasing from approximately $308 million in Q1 2023 to $373 million in Q2 2025, providing liquidity for operations and investing activities.
• Significant Trading Account Securities: Trading securities represent a substantial asset base, peaking around $2.14 billion in Q2 2025, supporting investment income stability.
• Use of Debt Financing: Long-term debt levels increased modestly from about $1.12 billion in Q1 2023 to $1.17 billion by Q2 2025, with the company actively issuing and repaying debt to manage capital structure.
• Increase in Total Equity: Total common equity stayed nearly flat around $990 million, although retained earnings are negative (~ -$126 million), partly offset by common stock and accumulated other comprehensive losses.
• Large Non-Cash Adjustments and Operating Capital Changes: Negative cash flow from operating activities noted in recent quarters (e.g., -$204.9 million in Q2 2025), driven by substantial non-cash adjustments (~ -$135.2 million) and changes in operating assets and liabilities (~ -$94.6 million), may warrant close monitoring.
• Volatility in Non-Interest Income: Non-interest income has fluctuated with gains and losses in realized/unrealized capital gains, having a material negative impact in some periods (e.g., -$75.3 million in Q4 2022), which impacts overall revenue volatility.

Overall, SLR Investment is demonstrating solid profitability and growth in net income and EPS, supported by consistent interest income and dividend payments. While the company relies on significant debt issuance and repayment activity along with fluctuating capital gains, its large asset base in trading securities and increased cash reserves support ongoing operations. Investors should watch the negative operating cash flow trends and capital gains volatility for future risk assessment.