Eagle Point Income Company Inc. Q3 FY2024 earnings call

• Generated strong net investment income and realized gains, and strengthened balance sheet via ATM and equity finance programs. • Actively managing portfolio towards maximizing shareholder returns, with $90 million of net capital deployed into new investments in third quarter, weighted average effective yield of new CLO purchases was 12%. • Saw $40 billion of new CLO issuance in third quarter of 2024, with year-to-date issuance at $142 billion. • Completed four re-financings and one reset of CLO equity positions, lowering debt costs by average 32 basis points. • Default risk remains low, with trailing 12-month default rate at 80 basis points as of quarter end, EIC's default exposure at 0.6%.

During the third quarter, the company recorded net investment income and realized gains of $0.57 per share. Recurring cash flows were $13.1 million or $0.76 per share. NAV as of September 30 was $14.90 per share, a 2% decrease from June 30. The company issued approximately 2.8 million common shares at a premium to NAV, generating NAV accretion of $0.05 per share. Daily average trading volume of common stock increased 29% from second quarter and more than tripled year-over-year. CLO coupons remain double digits, and portfolio closing equity exposure enhances earning ability.

• Declared $0.20 per share monthly common distributions through March 2025. • Expect to deploy new capital into additional investments offering compelling risk-adjusted returns. • Management unaudited estimate of NAV as of October 31st was between $14.99 and $15.09 per share, midpoint up from September 30th level.

• Forward-looking statements involve risks and uncertainties that may cause actual results to differ from projections. • Default risk could be impacted by significant loan defaults well above historical average coupled with limited loan price volatility. • Market conditions and economic cycles can affect portfolio performance.

Q: Matthew Howlett from B. Riley Securities asked about the BB market, acquisitions, tiering, discounts, portfolio growth.

A: Dan Ko responded that CLO BB spreads held in well despite Fed rate cuts, saw tiering compress within managers and between new issue and resets. Tom Majewski added on portfolio growth potential, noting the U.S. CLO market is ~$1 trillion, BB class ~$40 billion, and EIC is a small player with room for growth, also discussing distribution yield compared to BDCs and the vehicle's efficiency and fee structure.