--- title: "Great ELM Capital | 10-Q: FY2026 Q1 Revenue Misses Estimate at USD 9.544 M" type: "News" locale: "en" url: "https://longbridge.com/en/news/285122021.md" datetime: "2026-05-04T20:59:17.000Z" locales: - [zh-CN](https://longbridge.com/zh-CN/news/285122021.md) - [en](https://longbridge.com/en/news/285122021.md) - [zh-HK](https://longbridge.com/zh-HK/news/285122021.md) --- # Great ELM Capital | 10-Q: FY2026 Q1 Revenue Misses Estimate at USD 9.544 M Revenue: As of FY2026 Q1, the actual value is USD 9.544 M, missing the estimate of USD 10.49 M. EPS: As of FY2026 Q1, the actual value is USD -0.05, missing the estimate of USD 0.32. EBIT: As of FY2026 Q1, the actual value is USD 2.61 M. #### Total Investment Income - **Q1 2026**: $9,544 thousand - **Q1 2025**: $12,495 thousand #### Interest Income - **Non-affiliated, non-controlled investments**: $5,089 thousand in Q1 2026 compared to $6,402 thousand in Q1 2025 . - **Non-affiliated, non-controlled investments (PIK)**: $819 thousand in Q1 2026 compared to $611 thousand in Q1 2025 . - **Controlled investments**: $812 thousand in Q1 2026 compared to $953 thousand in Q1 2025 . - **Total interest income**: $6,720 thousand in Q1 2026 compared to $7,966 thousand in Q1 2025 . This decrease was attributed to a lower average coupon rate across the portfolio and a reduction in the debt investment portfolio size . The average coupon rate was 10.9% on approximately $199.2 million principal as of March 31, 2026, versus 11.7% on approximately $256.2 million principal as of March 31, 2025 . PIK interest remained consistent year-over-year . #### Dividend Income - **Non-affiliated, non-controlled investments**: $159 thousand in Q1 2026 compared to $236 thousand in Q1 2025 . - **Controlled investments**: $2,546 thousand in Q1 2026 compared to $3,376 thousand in Q1 2025 . - **Total dividend income**: $2,705 thousand in Q1 2026 compared to $3,612 thousand in Q1 2025 . The decrease resulted from fewer holdings in dividend-paying equity investments and reduced distributions from the CLO JV, which were $2.5 million in Q1 2026 versus $3.3 million in Q1 2025 . #### Other Income - **Non-affiliated, non-controlled investments**: $119 thousand in Q1 2026 compared to $743 thousand in Q1 2025 . - **Non-affiliated, non-controlled investments (PIK)**: $0 thousand in Q1 2026 compared to $174 thousand in Q1 2025 . - **Total other income**: $119 thousand in Q1 2026 compared to $917 thousand in Q1 2025 . This decline was primarily due to the absence of non-refundable carry fees, early repayment fees, and amendment fees in Q1 2026 that were present in Q1 2025 . #### Expenses - **Total Expenses**: $7,280 thousand in Q1 2026 compared to $7,851 thousand in Q1 2025 . - **Management fees**: $1,072 thousand in Q1 2026 compared to $1,272 thousand in Q1 2025, decreasing due to a decline in the fair value of the portfolio . - **Incentive fees**: $543 thousand in Q1 2026 compared to $1,150 thousand in Q1 2025 . - **Incentive fee waiver**: - $2,810 thousand in Q1 2026 compared to $0 thousand in Q1 2025 . Great Elm Capital Management, LLC (GECM) waived all accrued and unpaid incentive fees through March 31, 2026, totaling $2.8 million, including an additional $0.5 million accrued in Q1 2026 . - **Total advisory fees**: - $1,195 thousand in Q1 2026 compared to $2,422 thousand in Q1 2025 . - **Administration fees**: $510 thousand in Q1 2026 compared to $355 thousand in Q1 2025, increasing due to higher allocable overhead and other expenses incurred by GECM . - **Directors’ fees**: $54 thousand in Q1 2026 compared to $53 thousand in Q1 2025 . - **Interest expense**: $4,256 thousand in Q1 2026 compared to $4,251 thousand in Q1 2025 . - **Professional services**: $514 thousand in Q1 2026 compared to $424 thousand in Q1 2025, increasing primarily due to general rate increases and certain one-time fees . - **Custody fees**: $35 thousand in Q1 2026 compared to $38 thousand in Q1 2025 . - **Other expenses**: $296 thousand in Q1 2026 compared to $308 thousand in Q1 2025 . - **Excise tax**: $91 thousand in Q1 2026 compared to $68 thousand in Q1 2025 . #### Net Investment Income - **Q1 2026**: $4,983 thousand - **Q1 2025**: $4,576 thousand #### Net Realized Gain (Loss) - **Gross realized gain**: $3,730 thousand in Q1 2026 compared to $365 thousand in Q1 2025 . Q1 2026 gains included approximately $2.7 million from Stone Ridge Opportunities Fund, LP and $0.7 million from American Coastal Insurance Corp. unsecured bond . - **Gross realized loss**: - $1,098 thousand in Q1 2026 compared to - $101 thousand in Q1 2025 . Q1 2026 losses included $0.2 million on the sale of State Street Blackstone Senior Loan ETF, $0.2 million from Auction.com first lien term loan, and $0.1 million from Conuma Resources LTD first lien second out term loan . - **Realized loss on repurchase of debt**: - $2 thousand in Q1 2026 compared to $0 thousand in Q1 2025 . - **Total net realized gain (loss)**: $2,630 thousand in Q1 2026 compared to $264 thousand in Q1 2025 . #### Net Change in Unrealized Appreciation (Depreciation) on Investments - **Unrealized appreciation**: $4,312 thousand in Q1 2026 compared to $5,994 thousand in Q1 2025 . - **Unrealized depreciation**: - $12,670 thousand in Q1 2026 compared to - $10,381 thousand in Q1 2025 . - **Total net change in unrealized appreciation (depreciation)**: - $8,358 thousand in Q1 2026 compared to - $4,387 thousand in Q1 2025 . Q1 2026 was primarily driven by approximately - $3.8 million related to the CLO JV and approximately - $2.3 million related to Universal Fiber Systems, LLC . It also included approximately - $2.6 million and - $1.1 million from the reversal of previously recognized unrealized appreciation on Stone Ridge and American Coastal, respectively, due to realization activities . These were partially offset by unrealized appreciation from CW Opportunity 2 LP (approx. $0.5 million), W&T Offshore, Inc. (approx. $0.4 million), Trouvaille Re Ltd. (approx. $0.3 million), and a $1.1 million reversal of unrealized depreciation on Del Monte Food Corp II, Inc. . #### Net Increase (Decrease) in Net Assets Resulting from Operations - **Q1 2026**: - $745 thousand - **Q1 2025**: $453 thousand #### Cash Flow - **Net cash provided by operating activities**: $23,492 thousand in Q1 2026 . - **Net cash used for financing activities**: - $25,326 thousand in Q1 2026 . - **Cash paid for interest**: $3,789 thousand in Q1 2026 compared to $3,774 thousand in Q1 2025 . #### Portfolio and Investment Activity - **Weighted Average Yield (End of Period)**: 11.56% as of March 31, 2026, compared to 11.66% as of December 31, 2025, and 12.29% as of March 31, 2025 . - **Investments at Fair Value (March 31, 2026)**: Debt was $190,403 thousand (177.16% of Net Assets), Equity/Other was $76,760 thousand (71.42% of Net Assets), and Short-Term Investments were $9,600 thousand (8.93% of Net Assets) . Total Investments amounted to $276,763 thousand (257.51% of Net Assets) . - **Portfolio Composition (March 31, 2026)**: Comprised 65 debt instruments across 49 companies, totaling approximately $190.4 million at fair value, and 18 equity investments in 15 companies with an aggregate fair value of approximately $76.8 million . - **Unfunded Commitments (March 31, 2026)**: Approximately $1.3 million to provide financing to certain portfolio companies . - **Asset Coverage Ratio (March 31, 2026)**: Approximately 161.8% . #### Portfolio Classification by Industry (Fair Value - March 31, 2026 vs. December 31, 2025) - **Structured Finance**: $44,072 thousand (16.51%) vs. $47,899 thousand (16.05%) . - **Specialty Finance**: $37,790 thousand (14.14%) vs. $38,462 thousand (12.90%) . - **Technology**: $30,035 thousand (11.24%) vs. $31,550 thousand (10.58%) . - **Consumer Products**: $26,374 thousand (9.87%) vs. $24,174 thousand (8.10%) . - **Insurance**: $18,575 thousand (6.95%) vs. $22,604 thousand (7.58%) . - **Industrial**: $13,521 thousand (5.06%) vs. $12,943 thousand (4.34%) . - **Food & Staples**: $13,288 thousand (4.97%) vs. $15,908 thousand (5.33%) . - **Chemicals**: $11,370 thousand (4.26%) vs. $19,359 thousand (6.49%) . - **Metals & Mining**: $8,392 thousand (3.14%) vs. $10,189 thousand (3.42%) . - **Media**: $7,000 thousand (2.62%) vs. $40 thousand (0.01%) . - **Apparel**: $6,484 thousand (2.43%) vs. $5,572 thousand (1.87%) . - **Transportation Equipment Manufacturing**: $5,928 thousand (2.22%) vs. $6,316 thousand (2.12%) . - **Consumer Services**: $5,382 thousand (2.01%) vs. $10,113 thousand (3.39%) . - **Energy Services**: $5,280 thousand (1.98%) vs. $5,393 thousand (1.81%) . - **Credit Fund**: $4,184 thousand (1.57%) vs. $10,096 thousand (3.38%) . - **Business Services**: $3,864 thousand (1.45%) vs. $8,712 thousand (2.92%) . - **Casinos & Gaming**: $3,852 thousand (1.44%) vs. $3,865 thousand (1.30%) . - **Marketing Services**: $3,055 thousand (1.14%) vs. $3,073 thousand (1.03%) . - **Energy Midstream**: $2,941 thousand (1.10%) vs. $2,970 thousand (1.00%) . - **Packaging**: $2,891 thousand (1.08%) vs. $4,025 thousand (1.35%) . - **Restaurants**: $2,861 thousand (1.07%) vs. $3,056 thousand (1.02%) . - **Textiles**: $2,015 thousand (0.75%) vs. $1,954 thousand (0.66%) . - **Environmental Services**: $1,999 thousand (0.75%) vs. $0 thousand (0.00%) . - **Oil & Gas Exploration & Production**: $1,945 thousand (0.73%) vs. $3,817 thousand (1.28%) . - **Financial Services**: $1,660 thousand (0.62%) vs. $2,834 thousand (0.95%) . - **Retail**: $1,415 thousand (0.53%) vs. $1,450 thousand (0.49%) . - **Healthcare**: $990 thousand (0.37%) vs. $995 thousand (0.33%) . - **Closed-End Fund**: $0 thousand (0.00%) vs. $899 thousand (0.30%) . #### Geographic Composition of Portfolio (Fair Value - March 31, 2026) - **United States**: $266,901 thousand (248.33% of Net Assets) . - **Canada**: $2,516 thousand (2.34% of Net Assets) . - **Bermuda**: $6,975 thousand (6.49% of Net Assets) . - **Australia**: $371 thousand (0.35% of Net Assets) . #### Outlook and Strategy Great Elm Capital Corp. anticipates having sufficient liquidity to meet its short-term and long-term obligations for at least the next 12 months and the foreseeable future . The company’s board has declared a distribution of $0.25 per share for the quarter ending June 30, 2026, payable on June 30, 2026, fully covered by distributable earnings . Additionally, GECM waived all accrued and unpaid incentive fees through June 30, 2026, effective April 2026, and Great Elm Capital Corp. plans to redeem its $18.6 million outstanding GECCO Notes on May 27, 2026 . ### Related Stocks - [GECC.US](https://longbridge.com/en/quote/GECC.US.md) ## Related News & Research - [Flexsteel Q4 2026 Earnings Preview](https://longbridge.com/en/news/296031749.md) - [Baker Hughes declares Q3 2026 dividend of R$ 0.81 per unit](https://longbridge.com/en/news/296392545.md) - [Algorhythm Holdings Reports Second Quarter 2026 Financial Results](https://longbridge.com/en/news/296124832.md) - [REG - UIL Limited UIL Finance Ltd - Purchase of 2026 ZDP Shares](https://longbridge.com/en/news/296129742.md) - [OpenMatter Network to Take Verification Message to Belgrade Blockchain Week 2026](https://longbridge.com/en/news/296112181.md)