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Runway Growth Finance Corp. Reports Second Quarter 2022 Financial Results

August 4, 2022

Achieves Record Total and Net Investment Income of $25.2 and $14.5 Million, Respectively

Increases Core Leverage Ratio of Portfolio to 40%

Grows Investment Portfolio to Record $807.7 Million

Conference Call Today, Thursday, August 4 at 6:00 p.m. ET

WOODSIDE, Calif., Aug. 04, 2022 (GLOBE NEWSWIRE) -- Runway Growth Finance Corp. (Nasdaq: RWAY) (“Runway Growth” or the “Company”), a leading provider of flexible capital solutions to late and growth-stage companies seeking an alternative to raising equity, today announced its financial results for the second quarter ended June 30, 2022.

Second Quarter 2022 Highlights

  • Total investment income of $25.2 million
  • Net investment income of $14.5 million, or $0.35 per share
  • Total investment portfolio of $807.7 million at fair value
  • Net asset value of $14.14 per share
  • Dollar-weighted annualized yield on debt investments of 15.1% for the quarter
  • Nine investments completed totaling $200.0 million in new commitments including $151.7 million in funded loans
  • Aggregate proceeds of $86.8 million received from principal repayments inclusive of interest, fees and proceeds from the exercise and sale of warrants
  • Declared third quarter dividend of $0.33 per share, up 10% quarter over quarter
  • Subsequent to quarter end, priced an offering of 7.50% notes due 2027 resulting in net proceeds of $78.1 million

“Runway Growth had another record quarter in which we grew our portfolio by executing against our credit-first, long-term strategy,” said David Spreng, Founder and CEO of Runway Growth. “We are well positioned to continue to prudently scale our portfolio in the second half of the year.”

Spreng continued, “We have the opportunity to capitalize on broader market dynamics and partner with best-in-class companies that are seeking non-dilutive capital. Runway is building a platform at the intersection of later-stage companies and lower-risk underwriting rigor. In volatile times, this focus on risk mitigation is our differentiator. We will continue to strategically deploy leverage and expand ROE to create value for both our shareholders and portfolio companies.”

Second Quarter 2022 Operating Results

Total investment income for the quarter ended June 30, 2022 was $25.2 million, compared to $18.7 million for the quarter ended June 30, 2021. The year-over-year improvement is primarily due to an increase in interest income on investments resulting from the new loans originated.

Net investment income for the quarter ended June 30, 2022 was $14.5 million, or $0.35 per share, compared to $11.3 million, or $0.35 per share, for the quarter ended June 30, 2021.

The Company's dollar-weighted annualized yield on average debt investments for the quarter ended June 30, 2022 was 15.1%. The Company calculates the yield on dollar-weighted debt investments for any period measured as (1) total investment-related income during the period divided by (2) the daily average of the fair value of debt investments outstanding during the period.

Total operating expenses for the quarter ended June 30, 2022 were $10.7 million, compared to $7.4 million for the quarter ended June 30, 2021. The increase was driven by an increase in management fees, incentive fees and interest expense, as well as expenses related to being a public company.

Net realized gain on investments for the quarter ended June 30, 2022 was $0.9 million, compared to a net realized loss of $4.6 million for the quarter ended June 30, 2021.

For the quarter ended June 30, 2022, net change in unrealized depreciation on investments was $16.2 million, compared to a net change in unrealized depreciation on investments of $0.03 million for the prior year period, due to the decline in value of our equity portfolio.

Portfolio and Investment Activity

As of June 30, 2022, Runway Growth’s investment portfolio had an aggregate fair value of approximately $807.7 million and was comprised of approximately $772.2 million in term loans, 98% senior secured, and $35.5 million in warrants and equity-related investments in 43 portfolio companies.

During the second quarter of 2022, Runway Growth originated nine investments totaling $200.0 million in commitments and $151.7 million in funded loans, including four investments in new portfolio companies and five new investments in existing portfolio companies.

Total portfolio investment activity for the three and six months ended June 30, 2022 and 2021 was as follows:

  Three Months Ended June 30, Six Months Ended June 30,
  2022  2021  2022  2021 
  (unaudited) (unaudited) (unaudited) (unaudited)
Beginning Investment Portfolio $754,289,370  $615,147,590  $729,516,274  $621,826,650 
Purchases of Investments(1)  151,745,980   80,826,530   238,602,649   135,670,562 
Purchases of U.S. Treasury Bills     29,999,885      54,999,849 
Amortization of Fixed Income Premiums or Accretion of Discounts  746,463   1,489,265   3,571,075   3,660,438 
Sales or Repayments of Investments  (76,915,188)  (80,217,114)  (86,793,259)  (94,717,114)
Scheduled Principal Payments of Investments  (6,842,105)     (7,265,675)  (2,066,437)
Sales and Maturities of U.S. Treasury Bills     (24,999,979)  (44,999,747)  (94,999,162)
Realized Gain (Loss) on Investments  903,722   (4,595,853)  532,461   (4,813,280)
Net Change in Unrealized Appreciation (Depreciation) on Investments  (16,199,638)  (33,281)  (25,435,174)  (1,944,463)
Ending Investment Portfolio $807,728,604  $617,617,043  $807,728,604  $617,617,043 
1. Includes PIK interest.            

Net Asset Value

As of June 30, 2022, NAV per share was $14.14, compared to $14.45 as of March 31, 2021. Total net assets at the end of the second quarter of 2022 were $579.4 million, compared to $597.5 million at the end of the prior period.

For the quarter ended June 30, 2022, net decrease in net assets resulting from operations was $0.8 million, or $0.02 per share, compared to a net increase of $6.7 million, or $0.21 per share, for the quarter ended June 30, 2021.

Liquidity and Capital Resources

As of June 30, 2022, the Company had approximately $123.8 million in available liquidity, including unrestricted cash and cash equivalents, and $117.0 million in available borrowing capacity under the Company’s credit facility, subject to existing terms, advance rates and regulatory and covenant requirements.

The Company ended the quarter with a core leverage ratio of approximately 40.2%, compared to 26.1% for the quarter ended March 31, 2022.


On July 28, 2022, the Company’s board of directors declared a regular quarterly distribution of $0.33 per share for the third quarter of 2022, payable on August 23, 2022 to stockholders of record as of August 9, 2022. This dividend represents an increase of 10% over the dividend declared in the prior quarter.

Recent Developments

On April 20, 2022, the Company announced that it priced an underwritten public offering of $70 million aggregate principal amount of notes due 2027 (the “Notes”). The full overallotment option was exercised by underwriters and resulted in net proceeds to the Company of approximately $78.1 million after payment of underwriting discounts and commissions but before deducting expenses payable by the Company related to this offering. The Company used the net proceeds from this offering to repay outstanding indebtedness under its Credit Agreement with KeyBank National Association (the “Credit Facility”). However, through re-borrowing of the initial repayments under the Credit Facility, the Company intends to use the net proceeds from this offering to make investments in accordance with its investment objective and strategies described in the prospectus supplement and the accompanying prospectus, to pay operating expenses and other cash obligations, and for general corporate purposes.

Conference Call
Runway Growth will hold a conference call to discuss its second quarter 2022 financial results at 3:00 p.m. PT (6:00 p.m. ET) on Thursday, August 4, 2022. To participate in the conference call or webcast, participants should register online at the Runway Investor Relations website. The earnings call can also be accessed through the following links:

A live webcast will be available in the investor section of the Company’s website, and will be archived for 90 days following the call.

About Runway Growth Finance Corp.

Runway Growth is a growing specialty finance company focused on providing flexible capital solutions to late- and growth-stage companies seeking an alternative to raising equity. Runway Growth is a closed-end investment fund that has elected to be regulated as a business development company under the Investment Company Act of 1940, as amended. Runway Growth is externally managed by Runway Growth Capital LLC, an established registered investment advisor that was formed in 2015 and led by industry veteran David Spreng. For more information, please visit

Forward-Looking Statements

Statements included herein may constitute "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Statements other than statements of historical facts included in this press release may constitute forward-looking statements and are not guarantees of future performance, condition or results and involve a number of risks and uncertainties, including the impact of COVID-19 and related changes in base interest rates and significant market volatility on our business, our portfolio companies, our industry and the global economy, as well as market volatility resulting from the conflict between Russia and Ukraine and the sanctions and other restrictive actions taken by the U.S. and other countries against Russia. Actual results may differ materially from those in the forward-looking statements as a result of a number of factors, including those described from time to time in Runway Growth’s filings with the Securities and Exchange Commission. Runway Growth undertakes no duty to update any forward-looking statement made herein. All forward-looking statements speak only as of the date of this press release.

IR Contacts:

Stefan Norbom, Prosek Partners, 

Thomas B. Raterman, Chief Financial Officer and Chief Operating Officer, 

Runway Growth Finance Corp.
Statements of Assets and Liabilities
     June 30, 2022    December 31, 2021
Investments at fair value:        
Non-control/non-affiliate investments at fair value (cost of $805,247,907 and $647,448,895, respectively) $799,855,284  $655,384,403 
Affiliate investments at fair value (cost of $4,551,235 and $0, respectively)  2,352,019    
Control investments at fair value (cost of $21,172,353 and $34,873,847, respectively)  5,521,301   29,130,371 
Investment in U.S. Treasury Bills at fair value (cost of $0 and $45,001,250, respectively)     45,001,500 
Total investments at fair value (cost of $830,971,495 and $727,323,992, respectively)  807,728,604   729,516,274 
Cash and cash equivalents  6,809,818   4,696,693 
Accrued interest receivable  3,419,067   2,368,680 
Other accounts receivable  81,018   816,065 
Prepaid and deferred expenses  401,909   949,768 
Total assets  818,440,416   738,347,480 
Credit facilities  163,000,000   61,000,000 
2026 Senior Notes  70,000,000   20,000,000 
Deferred debt costs (net of accumulated amortization of $1,249,583 and $855,295, respectively)  (4,394,010)  (1,511,540)
Total debt, less unamortized deferred debt costs  228,605,990   79,488,460 
Reverse repurchase agreement     44,774,963 
Accrued incentive fees  7,415,334   6,010,250 
Due to affiliate  184,759   221,243 
Interest payable  1,030,660   249,247 
Accrued expenses and other liabilities  1,791,669   1,408,826 
Total liabilities  239,028,412   132,152,989 
Net assets        
Common stock, par value  413,806   413,806 
Additional paid-in capital  606,063,671   606,047,671 
Distributable (losses)  (21,786,236)  (266,986)
Treasury stock  (5,279,237)   
Total net assets $579,412,004  $606,194,491 
Shares of common stock outstanding ($0.01 par value, 100,000,000 shares authorized)  40,967,122   41,380,614 
Net asset value per share $14.14  $14.65 

Runway Growth Finance Corp.
Statements of Operations
  Three Months Ended June 30, Six Months Ended June 30,
  2022  2021  2022  2021 
Investment income            
From non-control/non-affiliate investments:            
Interest income $20,430,136  $17,229,488  $37,192,810  $32,250,053 
Payment in-kind interest income  1,042,832   1,045,527   2,049,065   1,989,558 
Other income  75,448   126,678   265,433   240,970 
Interest income from U.S. Treasury Bills     15      25 
Dividend income  317,674   343,755   703,092   687,510 
From affiliate investments:            
Interest income  4,654      4,654    
Payment in-kind interest income  6,689      96,291    
Other income  8,311      8,311    
From control investments:            
Interest income  618,099      1,112,421    
Payment in-kind interest income  2,654,039      2,984,450    
Other income from non-investment sources  208   139   463   260 
Total investment income  25,158,090   18,745,602   44,416,990   35,168,376 
Operating expenses            
Management fees  2,862,303   2,276,341   5,422,239   4,345,550 
Incentive fees  3,621,139   2,836,303   4,965,135   3,812,007 
Interest expense  1,609,132   761,815   2,482,617   1,489,730 
Professional fees  888,114   498,913   1,247,921   820,505 
Overhead allocation expense  218,294   208,736   455,266   406,119 
Insurance expense  268,618   23,275   537,236   46,551 
Administration fee  168,078   92,760   336,651   240,860 
Debt financing fees  726,568   419,216   1,432,534   709,201 
Directors’ fees  82,500   69,250   171,000   134,000 
Tax expense  823   41   1,073   41 
Other expenses  233,939   218,475   426,848   341,601 
Total operating expenses  10,679,508   7,405,125   17,478,520   12,346,165 
Net investment income  14,478,582   11,340,477   26,938,470   22,822,211 
Realized and unrealized gain (loss) on investments            
Realized gain (loss) on non-control/non-affiliate investments, including U.S. Treasury Bills  903,787   (4,595,853)  532,526   (4,795,077)
Realized gain (loss) on control investments  (65)     (65)   
Net change in unrealized appreciation (depreciation) on non-control/non-affiliate investments, including U.S. Treasury Bills  (8,164,496)  (1,683,287)  (12,319,165)  (4,121,553)
Net change in unrealized appreciation (depreciation) on affiliate investments  (42,674)     (3,208,433)   
Net change in unrealized appreciation (depreciation) on control investments  (7,992,468)  1,650,006   (9,907,576)  2,177,090 
Net realized and unrealized gain (loss) on investments  (15,295,916)  (4,629,134)  (24,902,713)  (6,739,540)
Net increase in net assets resulting from operations $(817,334) $6,711,343  $2,035,757  $16,082,671 
Net increase in net assets resulting from operations per common share $(0.02) $0.21  $0.05  $0.50 
Net investment income per common share $0.35  $0.35  $0.65  $0.71 
Weighted-average shares outstanding  41,215,664   32,396,396   41,294,985   31,953,287