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• A publicly traded private credit fund, akin to those run by firms like Blackstone or Apollo, but available to individual investors.
• The publicly traded equivalent of a private lending arm within a major investment bank like Goldman Sachs.

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• Senior Secured Debt: Providing loans to middle-market companies that are secured by the borrower's assets and have first claim in the event of default.
• Subordinated Debt (Mezzanine Debt): Offering unsecured or partially secured loans to middle-market companies that rank below senior debt but often include equity components like warrants.
• Equity Investments: Making direct investments in the common or preferred stock of middle-market companies, often in conjunction with debt financing.

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Pennant Park Investment Corporation (PNNT) is a Business Development Company (BDC) that provides financing, primarily in the form of debt and to a lesser extent equity, to middle-market companies. As such, its "customers" are the companies in which it invests and lends capital. These portfolio companies are predominantly privately held, rather than publicly traded entities to which PNNT sells goods or services in a traditional customer-supplier relationship.

Therefore, PNNT does not have "major customers" that are public companies in the traditional sense of the prompt. Instead, its business involves providing debt and equity financing to a diversified portfolio of private middle-market companies across various industries. Below are a few examples of companies from PNNT's investment portfolio as of its latest public filings (these are private companies with no public stock symbols):

• Aven Global, LLC (a private holding company related to various industrial businesses)
• Taco Mac Restaurant Group, LLC (a private full-service restaurant chain)
• Procare Software, LLC (a private company providing child care management software solutions)

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Arthur Penn, Chairman of the Board, Chief Executive Officer

Arthur Penn is the Founder, Chairman, and Chief Executive Officer of PennantPark Investment Corporation (PNNT) and PennantPark Floating Rate Capital Ltd. (PFLT), which he established in 2007 and 2010, respectively. He is also the Founder and Managing Member of PennantPark Investment Advisers LLC. Prior to founding PennantPark, Mr. Penn co-founded Apollo Investment Management in 2004, where he served as a Managing Partner from 2004 to 2006. During the same period, he was the Chief Operating Officer and later President and Chief Operating Officer of Apollo Investment Corporation. He was also a Managing Partner of Apollo Value Fund L.P. from 2003 to 2006. Earlier in his career, he held positions as Global Head of Leveraged Finance at UBS Warburg LLC (1999-2001), Global Head of Fixed Income Capital Markets for BT Securities and BT Alex. Brown Incorporated (1994-1999), and Head of High-Yield Capital Markets at Lehman Brothers (1992-1994).

Richard T. Allorto, Jr., Chief Financial Officer and Treasurer

Richard T. Allorto, Jr. joined PennantPark in June 2022 as the Chief Financial Officer and Treasurer, overseeing financial reporting, accounting, tax, operations, treasury, and administrative matters for both PFLT and PNNT. Before his tenure at PennantPark, he served as the Chief Financial Officer of Medley Management Inc., Sierra Income Corporation, and Medley Capital Corporation. Mr. Allorto was also a Managing Director at GSC Group from 2001 to 2010. His previous roles include Chief Financial Officer for GSC Investment Corp., PhenixFIN Corp., MCC Advisors LLC, Sierra Income Corp., and Sierra Total Return Fund, and he was an Audit Supervisor at Arthur Andersen LLP.

James Heyer, Managing Director, Head of Capital Markets

James Heyer joined PennantPark in June 2012 as a Managing Director and Head of Capital Markets. His responsibilities include originating, underwriting, executing, and monitoring investments for the firm, as well as managing direct co-lending relationships. Before joining PennantPark, Mr. Heyer was a Vice President at Praesidian Capital from 2008 to 2012. Prior to that, he worked as an analyst in the Structured Finance Group at Goldman, Sachs & Co. from 2005 to 2008. He holds a BS in Economics from The Wharton School of the University of Pennsylvania.

Pete Mitchell, Managing Director, Head of Private Capital Fundraising

Pete Mitchell joined PennantPark in August 2021 as a Managing Director, Head of Private Capital Fundraising, where he leads fundraising efforts for the firm's private vehicles. Before his role at PennantPark, Mr. Mitchell was a Senior Vice President at Crescent Capital Group LP from 2015 to 2021. His financial career also includes positions as a Senior Portfolio Specialist at Thornburg Investment Management (2012-2015), a Managing Director at EnTrust Capital (2010-2012), and Southeast Director of Sales at Snow Capital Management (2005-2010). Before entering the financial services industry, Mr. Mitchell had a nine-year career playing professional football in the NFL, including with the Jacksonville Jaguars and New York Giants.

Colin Maguire, Managing Director

Colin Maguire joined PennantPark in October 2013 and serves as a Managing Director. In this role, he has been involved in originating, underwriting, executing, and monitoring investments for the firm. Before joining PennantPark, Mr. Maguire worked as an Investment Banking Analyst in the Financial Sponsors Group at Barclays Capital from 2011 to 2013. He earned a BS in Finance from Villanova University.

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Key Risks to PennantPark Investment (PNNT)

1. High Leverage and Debt-Related Risks: PennantPark Investment (PNNT) exhibits a high debt-to-equity ratio, which analysts consider indicative of significant leverage. This elevated leverage increases the risk of losses, escalates expenses, and poses a threat to the company's ability to maintain required asset coverage ratios or meet debt covenants. Concerns have also been raised regarding potential hidden debt within unconsolidated joint ventures, further exacerbating the company's financial risk profile.
2. Unsustainable Dividend and Declining Net Investment Income: PNNT's dividend payout ratio is considered excessively high, which may compromise its long-term sustainability. The company has experienced a decline in core net investment income per share, resulting in poor dividend coverage. This situation leads some to believe that the current dividend yield may be unsustainable.
3. Credit Risk and Volatility of Middle-Market Investments: PNNT's primary business involves significant exposure to credit risk, as there is a material risk that borrowers may default on their payments. Such defaults could have a substantially negative impact on PNNT's financial performance and the overall value of its investment portfolio. The company's focus on investing in middle-market companies, which often face limited capital availability, introduces inherent volatility to its investment strategy.

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PennantPark Investment Corporation (PNNT) primarily operates in the U.S. middle-market lending and private credit sectors, providing debt and equity financing to private, mid-sized companies.

The addressable market for private credit in the United States is estimated to be between approximately $1.1 trillion and $2.1 trillion. More specifically, some sources indicate the U.S. private credit market is around $1.1 trillion or $1.25 trillion. However, the broader addressable market for private credit in the United States, encompassing the potential universe of companies that could utilize such financing, could be significantly larger, potentially exceeding $30 trillion.

The core middle market, which PennantPark targets, consists of businesses generally with annual revenues between $10 million and $200 million, or sometimes up to $1 billion, and EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortization) typically ranging from $10 million to $50 million, or up to $150 million. This segment of the U.S. economy comprises nearly 200,000 businesses, representing approximately one-third of the private sector's gross domestic product.

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Expected Drivers of Future Revenue Growth for PennantPark Investment (PNNT)

1. Expansion of the Joint Venture (JV) Portfolio: PennantPark expects continued growth in its joint venture portfolio, which is a significant contributor to its earnings. The company's JV recently increased its senior secured credit facility, allowing it to scale its investment portfolio to over $1.5 billion, representing a substantial increase in investment capacity. Management anticipates this continued growth will enhance PNNT's earnings momentum in future quarters.
2. Origination of New Investment Opportunities: PNNT consistently focuses on originating attractive investment opportunities within the core middle market. The company has demonstrated a track record of deploying capital into both new and existing portfolio companies at attractive weighted average yields. This ongoing ability to source and invest in promising businesses is a crucial driver for increasing interest and dividend income.
3. Strategic Rotation from Equity to Debt Investments: The company is actively executing a strategy to transition out of equity positions and reallocate that capital into interest-paying debt investments. This strategic rotation is expected to increase core net investment income and management anticipates making significant progress in this area over the next 12-18 months.
4. Increased Loan Originations Driven by Deal Activity: Management foresees an increase in loan originations, coupled with exits from equity positions, driven by a resurgence in overall deal activity within the market. A more active deal environment provides PNNT with greater opportunities to deploy capital into new loans and optimize its portfolio.

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Share Repurchases

• PennantPark Investment Corporation announced a $25 million stock repurchase program in February 2022.
• Between January 1, 2022, and March 31, 2022, the company repurchased 913,454 shares at an average price of $7.72 per share.
• Management has prioritized shareholder returns through dividends and occasional buybacks, contributing to a decrease in total shares outstanding from 73 million in 2015 to 65.3 million currently.

Share Issuance

• PennantPark Investment Corporation had an at-the-market (ATM) program, for which $0.3 million of deferred offering costs were expensed; this program expired on April 28, 2025.

Outbound Investments

• PennantPark Investment Corporation's total investment portfolio was $1.3 billion as of December 31, 2024, diversified across 158 companies in 35 industries.
• As of June 30, 2025, the investment portfolio totaled $1,171.6 million, comprising 41% first lien secured debt, 1% second lien secured debt, 16% subordinated debt, 31% preferred and common equity, and 11% U.S. Government Securities.
• During the three months ended December 31, 2024, PNNT invested $296 million in 12 new and 61 existing portfolio companies with a weighted average yield of 10.6% on new investments. For the three months ended June 30, 2025, $87.7 million was invested in four new and 28 existing portfolio companies with a weighted average yield on debt investments of 10.0%.