Investments

6 Months Ended

Mar. 31, 2025

Note 3. Investments

The composition of our investments as of March 31, 2025 as a percentage of our total portfolio, at amortized cost and fair value were as follows (dollars in thousands):

	Amortized Cost		Percentage			Fair Value		Percentage
Senior Secured First Lien Term Loans	$	133,693		41.8	%	$	117,838		41.0	%
Senior Secured Notes		12,914		4.0			13,099		4.6
Fund Investment		1,746		0.5			1,600		0.6
Equity/Warrants		172,132		53.7			154,306		53.8
Total Investments	$	320,485		100.0	%	$	286,843		100.0	%

The composition of our investments as of September 30, 2024 as a percentage of our total portfolio, at amortized cost and fair value were as follows (dollars in thousands):

	Amortized Cost		Percentage			Fair Value		Percentage
Senior Secured First Lien Term Loans	$	129,957		49.8	%	$	113,990		50.0	%
Senior Secured Notes		18,127		7.0			18,476		8.1
Fund Investment		1,746		0.7			1,525		0.7
Equity/Warrants		110,930		42.5			93,925		41.2
Total Investments	$	260,760		100.0	%	$	227,916		100.0	%

In connection with certain of the Company’s investments, the Company receives warrants that are obtained for the objective of increasing the total investment returns and are not held for hedging purposes. At March 31, 2025 and September 30, 2024, the total fair value of warrants was $1,685.7 thousand and $82.7 thousand, respectively, and were included in investments at fair value on the Consolidated Statements of Assets and Liabilities. During the three and six months ended March 31, 2025 and 2024, the Company acquired one warrant in an existing portfolio company.

For the three and six months ended March 31, 2025, there was $228.7 thousand and $493.7 thousand, respectively, in unrealized depreciation related to warrants and was recorded on the Consolidated Statements of Operations as net unrealized appreciation/(depreciation) on investments. For the three and six months ended March 31, 2024, there was $95.5 thousand and $73.3 thousand, respectively, in unrealized depreciation related to warrants and was recorded on the Consolidated Statements of Operations as net unrealized appreciation/(depreciation) on investments. The warrants are received in connection with individual investments and are not subject to master netting arrangements.

The following table shows the portfolio composition by industry grouping at fair value at March 31, 2025 (dollars in thousands):

	Fair Value		Percentage

Services: Business	$	55,636		19.4	%
Insurance		48,397		16.9
Services: Consumer		39,044		13.6
Real Estate		35,533		12.5
Hotel, Gaming & Leisure		26,469		9.2
High Tech Industries		18,344		6.4
Construction & Building		17,743		6.2
Metals & Mining		12,161		4.2
Aerospace & Defense		11,021		3.8
Automotive		10,716		3.7
Consumer Discretionary		5,256		1.8
Media: Broadcasting & Subscription		4,923		1.7
Banking		1,600		0.6
Total	$	286,843		100.0	%

The following table shows the portfolio composition by industry grouping at fair value at September 30, 2024 (dollars in thousands):

	Fair Value		Percentage

Real Estate	$	50,162		22.0	%
Services: Business		46,706		20.5
Services: Consumer		28,121		12.3
Hotel, Gaming & Leisure		24,253		10.6
Construction & Building		17,095		7.5
High Tech Industries		12,352		5.5
Automotive		12,316		5.4
Metals & Mining		12,161		5.3
Media: Broadcasting & Subscription		9,003		4.0
Energy: Oil & Gas		4,333		1.9
Packaging		3,505		1.5
Consumer Discretionary		3,456		1.5
Aerospace & Defense		2,827		1.2
Banking		1,525		0.7
Insurance		101		0.1
Total	$	227,916		100.0	%

The Company invests in portfolio companies principally located in the United States. The geographic composition is determined by the location of the corporate headquarters of the portfolio company, which may not be indicative of the primary source of the portfolio company’s business.

The following table shows the portfolio composition by geographic location at fair value at March 31, 2025 (dollars in thousands):

	Fair Value		Percentage
Northeast	$	107,939		37.7	%
Southeast		106,030		37.0
West		32,231		11.2
Midwest		25,505		8.9
Southwest		2,547		0.9
Mid-Atlantic		411		0.1
International		12,180		4.2
Total	$	286,843		100.0	%

The following table shows the portfolio composition by geographic location at fair value at September 30, 2024 (dollars in thousands):

	Fair Value		Percentage
Northeast	$	87,269		38.3	%
Southeast		61,276		26.9
Midwest		34,648		15.2
West		31,951		14.0
Southwest		2,749		1.2
Mid-Atlantic		375		0.2
International		9,648		4.2
Total	$	227,916		100.0	%

Transactions With Affiliated/Controlled Companies

The Company had investments in portfolio companies designated as Affiliated Investments and Controlled Investments under the 1940 Act. Transactions with Affiliated Investments and Controlled Investments during the three and six months ended March 31, 2025 and 2024 were as follows:

Name of Investment⁽¹⁾⁽²⁾	Type of Investment	Fair Value at September 30, 2024		Purchases/ (Sales) of or Advances/ (Distributions)		Transfers In/(Out) of Affiliates		Unrealized Gain/(Loss)			Realized Gain/(Loss)		Fair Value at March 31, 2025		Earned Income
Affiliated Investments
Black Angus Steakhouses, LLC	Senior Secured First Lien Delayed Draw Term Loan	$	751,207	$	-	$	-	$	(302,288	)	$	-	$	448,919	$	-
	Senior Secured First Lien Super Priority DDTL		1,647,776		-		-		(663,070	)		-		984,706		-
FST Holdings Parent, LLC	Equity		12,351,802		8,289		-		(16,195	)		-		12,343,896		254,231
Total Affiliated Investments		$	14,750,785	$	8,289	$	-	$	(981,553	)	$	-	$	13,777,521	$	254,231

Name of Investment⁽¹⁾⁽²⁾	Type of Investment	Fair Value at September 30, 2024		Purchases/ (Sales) of or Advances/ (Distributions)		Transfers In/(Out) of Controlled		Unrealized Gain/(Loss)			Realized Gain/(Loss)		Fair Value at March 31, 2025		Earned Income
Controlled Investments
ECC Capital Corp.	Senior Secured First Lien Term Loan	$	7,422,012	$	-	$	-	$	-		$	-	$	7,422,012	$	391,510
	Equity		4,872,000		-		-		159,600			-		5,031,600		-
FlexFIN, LLC	Equity Interest		36,683,045		92,290		-		-			-		36,775,335		2,979,966
NSG Captive, Inc.	Equity		101,000		49,145,255		-		(849,113	)		-		48,397,142		-
NVTN LLC	Senior Secured First Lien Delayed Draw Term Loan		5,500,000		4,300,000		-		-			-		9,800,000		294,649
	Senior Secured First Lien Term Loan B		16,353,590		-		-		(1,118,089	)		-		15,235,501		528,826
Total Controlled Investments		$	70,931,647	$	53,537,545	$	-	$	(1,807,602	)	$	-	$	122,661,590	$	4,194,951

Name of Investment⁽¹⁾⁽²⁾	Type of Investment	Fair Value at September 30, 2023		Purchases/ (Sales) of or Advances/ (Distributions)			Transfers In/(Out) of Affiliates			Unrealized Gain/(Loss)			Realized Gain/(Loss)			Fair Value at March 31, 2024		Earned Income
Affiliated Investments
1888 Industrial Services, LLC	Senior Secured First Lien Term Loan C	$	751,479	$	(1,096,561	)	$	(196,411	)	$	439,778		$	101,715		$	-	$	37,645
	Senior Secured First Lien Term Loan A		-		-			-			9,473,068			(9,473,068	)		-		-
	Revolving Credit Facility		4,632,177		(5,112,074	)		-			-			479,897			-		158,674
Black Angus Steakhouses, LLC	Senior Secured First Lien Delayed Draw Term Loan		875,749		-			-			-			-			875,749		-
	Senior Secured First Lien Term Loan		1,459,249		-			-			(648,417	)		-			810,832		-
	Senior Secured First Lien Super Priority DDTL		1,920,960		-			-			-			-			1,920,960		-
FST Holdings Parent, LLC	Equity		10,000,003		-			-			726,323			-			10,726,326		-
Maritime Wireless Holdings LLC	Senior Secured First Lien Term Loan B		7,500,000		(7,373,166	)		-			(126,834	)		-			-		535,857
	Equity		10,150,000		(11,900,000	)		-			(5,150,000	)		6,900,000			-		-
Total Affiliated Investments		$	37,289,617	$	(25,481,801	)	$	(196,411	)	$	4,713,918		$	(1,991,456	)	$	14,333,867	$	732,176

Name of Investment⁽¹⁾⁽²⁾	Type of Investment	Fair Value at September 30, 2023		Purchases/ (Sales) of or Advances/ (Distributions)			Transfers In/(Out) of Controlled		Unrealized Gain/(Loss)			Realized Gain/(Loss)		Fair Value at March 31, 2024		Earned Income
Controlled Investments
FlexFIN, LLC	Equity Interest	$	38,870,711	$	(4,141,486	)	$	-	$	-		$	-	$	34,729,225	$	2,233,395
Kemmerer Operations, LLC	Senior Secured First Lien Term Loan		3,383,877		(97,841	)		-		-			-		3,286,036		268,831
	Equity		9,133,052		2,300,000			-		733,122					12,166,174		-
NSG Captive, Inc.	Equity		-		100,000			-		-			-		100,000		-
NVTN LLC	Senior Secured First Lien Delayed Draw Term Loan		7,214,856		(1,705,081	)		-		(9,775	)		-		5,500,000		580,266
	Senior Secured First Lien Term Loan B		5,037,547		-			-		12,488,543			-		17,526,090		-
	Equity		-		11,900,000			-		(11,900,000	)		-		-		-
Total Controlled Investments		$	63,640,043	$	8,355,592		$	-	$	1,311,890		$	-	$	73,307,525	$	3,082,492

(1)	The par amount and additional detail are shown in the Consolidated Schedules of Investments.

(2)	Securities with a zero value at the beginning and end of the period, and those that had no transaction activity were excluded from the roll forward.

Purchases/(sales) of or advances to/(distributions) from Affiliated Investments and Controlled Investments represent the proceeds from sales and settlements of investments, purchases, originations and participations, investment increases due to PIK interest as well as net amortization of premium/(discount) on investments and are included in the purchases and sales presented on the Consolidated Statements of Cash Flows for the six months ended March 31, 2025 and 2024. Transfers in/(out) of Affiliated Investments and Controlled Investments represent the fair value for the month an investment became or was removed as an Affiliated Investment or a Controlled Investment. Income received from Affiliated Investments and Controlled Investments is included in total investment income on the Consolidated Statements of Operations for the three and six months ended March 31, 2025 and 2024.

Unconsolidated Significant Subsidiaries

In accordance with the SEC’s Regulation S-X and GAAP, the Company evaluated and determined that it had one subsidiary, FlexFIN, LLC, for which the Company owned 50%, that is deemed to be a “significant subsidiary” as of March 31, 2025 for which summarized financial information is presented below (dollars in thousands):

Balance Sheet	March 31, 2025 (Unaudited)		September 30, 2024 (Audited)
Total Assets	$	50,622	$	51,634
Total Liabilities		14,348		15,206

Income Statement	For the Six Months Ended March 31, 2025 (Unaudited)		For the Year Ended September 30, 2024 (Audited)
Total Income	$	3,592	$	4,955
Total Expenses		899		1,028
Net Income	$	2,693	$	3,927

- Definition

The entire disclosure for investments owned by investment company.

+ References + Details

PhenixFIN Corp 10-Q