Summary and Analysis of Key Points

Overview

• SuRo Capital Corp. is an internally managed, non-diversified closed-end management investment company that has elected to be regulated as a business development company (BDC) and a regulated investment company (RIC).
• The company’s investment objective is to maximize its portfolio’s total return, primarily through capital gains on equity and equity-related investments, and to a lesser extent, income from debt investments.
• SuRo Capital invests principally in the equity securities of rapidly growing venture capital-backed emerging companies across several key industry themes.

Portfolio and Investment Activity

• The value of SuRo Capital’s investment portfolio was $213.6 million as of March 31, 2025.
• During the three months ended March 31, 2025, the company made $1.3 million in new investments and did not exit any investments, realizing a net loss of $18,000.
• In comparison, during the three months ended March 31, 2024, the company made $10.0 million in new investments, exited investments for $318,000, and realized a net loss of $424,000.

Results of Operations

• Investment income decreased from $1.5 million in Q1 2024 to $499,000 in Q1 2025, primarily due to lower interest and dividend income.
• Total operating expenses decreased from $4.8 million in Q1 2024 to $4.2 million in Q1 2025, driven by lower compensation and other expenses.
• The company recognized a net investment loss of $3.7 million in Q1 2025, compared to a $3.2 million loss in Q1 2024.
• Net realized losses on investments improved from $424,000 in Q1 2024 to $18,000 in Q1 2025.
• The company had a net change in unrealized appreciation of $2.9 million in Q1 2025, compared to an $18.4 million unrealized depreciation in Q1 2024.

Liquidity and Capital Resources

• As of March 31, 2025, SuRo Capital had $38.5 million in cash reserves and liquid securities.
• The company has $75.2 million in total debt outstanding, including $39.7 million of 6.00% Notes due 2026 and $35.0 million of 6.50% Convertible Notes due 2029.
• SuRo Capital did not repurchase any shares under its $25 million share repurchase program during the periods presented.

Outlook

• SuRo Capital believes it has ample liquidity to support its near-term capital requirements, and will continue to evaluate its overall liquidity position.
• The company’s investment strategy and portfolio composition expose it to risks related to economic conditions, market volatility, and the performance of its portfolio companies.
• SuRo Capital’s ability to generate investment income and make distributions to shareholders may be limited by its focus on equity investments that do not produce current income.

Overall, SuRo Capital’s financial performance in the first quarter of 2025 showed some improvement compared to the prior year, with lower operating expenses and reduced realized losses on investments. However, the company continues to face challenges in generating consistent investment income due to its equity-focused strategy. Maintaining adequate liquidity and managing portfolio risks will be key priorities going forward.