Eagle Point Income Company Inc.

Good morning and welcome everyone to Eagle Point Income Company's third quarter earnings call. I will now turn the call over to Peter Squisa at ICR.

Thank you and good morning. Before we begin our formal remarks, we need to remind everyone that the matters discussed in this call include forward-looking statements or projected financial information that involve risks and uncertainties that may cause the company's actual results to differ materially from those projected in such forward-looking statements and projected financial information. For further information on factors that could impact the company and the statements and projections contained herein, please refer to the company's filings with the Securities and Exchange Commission. Each forward-looking statement and projection of financial information made during this call is based on information available to us as of the date of this call. We disclaim any obligation to update our forward-looking statements unless required by law. A replay of this call can be accessed for 30 days via the company's website, www.EaglePointIncome.com. Earlier today, we filed our third quarter 2023 financial statements in our third quarter investor presentation with the Securities and Exchange Commission. Financial statements and our third quarter investor presentation are also available within the investor relations section of the company's website. Financial statements can be found by following the financial statements and reports link, and the investor presentation can be found by following the presentations and events link. I would now like to introduce Tom Majewski, Chairman and Chief Executive Officer of Eagle Point Income Company.

Thank you, Peter, and welcome everyone to Eagle Point Income Company's third quarter earnings call. We appreciate your interest in Eagle Point Income Company, or EIC. If you haven't done so already, we invite you to download our investor presentation from our website at eaglepointincome.com, which I will refer to in a portion of my remarks. The company continued its strong momentum from the first half of the year as it generated another quarter-over-quarter increase in portfolio cash flows. Our portfolio is doing what we designed it to do in a rising rate environment. generate more cash for our investors. Given our continued confidence in the portfolio, we were pleased last week to again increase our regular common distribution, the monthly distribution, and beginning in January 2024. This time, we increased our monthly distribution by 11 percent to 20 cents per share per month. This is the highest monthly common distribution per share in our history. To share a few highlights from the quarter, Net investment income was 51 cents per share, which is excluding 13 cents per share of non-recurring expenses. Our recurring cash flows were 7.1 million, or 76 cents per share, comfortably in excess of our regular common distributions and operating expenses, excluding non-recurring items. We paid three monthly common distributions of 16 cents per share during the third quarter, and are paying three monthly common distributions of 18 cents per share in the fourth quarter. And as I just noticed, we declared another increase in our monthly common distributions to 20 cents per common share for the first quarter beginning in January. Our NAV as of September 30th was $14.08 per share, and this is an increase of 8% from June 30th. Our NAV came down a bit in October due to spread widening in the market, and the $13.65 midpoint of our NAV range as of October 31st reflects approximately a 3% decrease from our September 30th figure, but still significantly ahead of where it stood on June 30th. We further strengthened our capital position with our 7.75% Series B term preferred stock offering that we completed in July. We raised $31.2 million of additional capital from this offering and have been deploying the proceeds into new CLO junior debt and equity investments. We believe this deployed capital will further help increase our net investment income. We also opportunistically raised capital through our at-the-market program, issuing nearly 1 million common shares at a premium to NAV, generating NAV accretion of about 2 cents per share during the quarter. We also raised about 15,000 shares of additional Series B term preferred stocks. Together, these sales generated about $14 million of net proceeds to the company. As of October 31st, we have over $17 million of cash and revolver borrowing capacity available to us. This is ample dry powder with which to invest as we further expand our portfolio. As is evident, our portfolio continues to benefit from the floating rate nature of CLOs, given that 100% of the CLO debt investments in our portfolio are floating rate. All of our CLO BB coupons are in the double digits, and some CLO BBs have the potential to yield north of 20% in an early call scenario. As long-term focused investors, we seek to construct our portfolio to manage through periods of dislocation, and our consistently strong performance with respect to cash flow and income is validation that we're executing on that playbook. We remain excited for our portfolio's potential as we head into 2024. For additional commentary on the overall market and our recent portfolio activity, I'd like to turn the call over to Senior Principal and Portfolio Manager, Dan Coe. Thank you, Tom.