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Operator: Ladies and gentlemen, greetings, and welcome to the Great Elm Group Fiscal 2025 Third Quarter Conference Call. [Operator Instructions] As a reminder, this conference call is being recorded. It is now my pleasure to introduce your host, Adam Yates, Managing Director. Please go ahead.

Adam Yates : Good morning, everyone. Thank you for joining us for Great Elm Group’s Fiscal Third Quarter 2025 Earnings Conference Call. As a reminder, this conference call is being recorded on Thursday, May 8, 2025. If you would like to be added to our distribution list, you can e-mail geginvestorrelations@gatelmcap.com or you can sign up for alerts directly on our website, www.greatelmgroup.com. The slide presentation accompanying today’s conference call and webcast can be found on our website under Events & Presentations. A link to the webcast is also available on our website as well as in the press release that was disseminated to announce the quarterly results. Today’s conference call includes forward-looking statements, and we ask that you refer to Great Elm Group’s filings with the SEC for important factors that could cause actual results to differ materially from these statements.

Great Elm Group does not undertake to update its forward-looking statements unless required by law. In addition, during today’s call, management will refer to certain non-GAAP financial measures. Reconciliations to the most comparable financial measures are included in our earnings release. To obtain copies of our SEC filings, please visit Great Elm Group’s website under Financial Information and select SEC filings. Today’s comments do not constitute an offer to sell or a solicitation of an offer to buy interest in any investment vehicle managed by Great Elm or its affiliate. Any such offer or solicitation will only be made pursuant to the applicable offering documents for such investment vehicle. On the call today, we have Jason Reese, CEO; Adam Kleinman, President and General Counsel; Nicole Milz, COO; and Keri Davis, CFO.

I will now turn the call over to Jason Reese, CEO.

Jason Reese: Welcome, everyone, and thank you for joining us today. We delivered a solid fiscal third quarter ’25, marked by significant year-over-year growth in both assets under management and revenues across our businesses. This momentum reflects our continued evolution into a streamlined alternative asset management business and strengthens our position to expand our core credit and real estate platforms as we execute on our long-term growth strategy. Among our recent highlights, in February, we launched Monomoy Construction Services, an integrated full-service construction business with the strategic acquisition of Greenfield CRE, a leading construction management company, which was combined with our existing Monomoy BTS Construction Management business.

We continue to grow our assets under management, increasing our fee-paying AUM by 15% on a year-over-year basis. We generated total revenue of $3.2 million, growing 15% year-over-year. We closed on the land purchase for our third build-to-suit property and made meaningful progress on our fourth project. We continue to repurchase shares at a meaningful discount to book value, executing on our $20 million buyback program. And we ended the quarter in a strong fiscal position with approximately $32 million in cash available to facilitate continued growth across our asset management platforms. Diving into the quarter in more detail. Fee-paying assets under management continued to grow and reached approximately $565 million, representing a 15% increase over the prior year period, primarily driven by our BDC, Great Elm Capital Corp., which raised approximately $147 million through equity and debt issuances in calendar 2024.

Notably, GEG has participated in 3 equity raises at GECC with a combined investment of approximately $12 million, facilitating an increase in fee-paying AUM at GECC of over 40%. GECC also delivered strong results to kick off the first quarter of 2025, generating record total investment income of $12.5 million, driven by cash flows from its CLO JV with net investment income that exceeded its recently increased quarterly distribution. Notably, it was also the highest cash income quarter in the company’s history, a testament to the strategic portfolio enhancements undertaken in the last 2 years. As you may have seen, this week, GECC launched an at-the-market offering to sell common shares at NAV or better, which we expect will provide an additional avenue for growth in assets under management.

Overall, GECC’s recent successes further reinforce our growth strategy. The increased capital base expands our fee-paying AUM, driving both higher recurring management fees and incentive fee potential. Notably, our base management fees from GECC grew over 40% year-over-year to $1.3 million, and GECC is well positioned to pay meaningful fees in the coming quarters. We’re very pleased with the performance of GECC, marked by continued portfolio growth and increased cash distributions. GECC continues to deliver significant value to shareholders by expanding and diversifying its portfolio while leveraging its institutional quality infrastructure. Shifting to our other products. Great Elm Credit Income Fund, our private credit fund, has delivered returns on invested capital of approximately 13.9% net of fees since inception through March 2025.

With these returns and track record, we are favorably positioned for future growth in the fund. Meanwhile, our real estate business, Monomoy, continues to execute and we are pleased to have closed on the land purchase for our third build-to-suit property, which we expect to complete during the calendar year. We also made meaningful progress on our fourth project as we progress through our growing pipeline of opportunities. Looking ahead, we anticipate continued profitability across the Monomoy platform as we remain committed to executing on these development projects to drive profitability and deliver value for both our tenants and shareholders. Further, building on strategic growth initiatives, in February, we significantly expanded our real estate capabilities through the acquisition of Greenfield CRE, a leading construction management company and a long-standing partner of Monomoy.

Greenfield has deep knowledge of our development projects, a strong understanding of our tenant needs and expectations and a proven track record of delivering on Monomoy’s high standards. In connection with this transaction, we launched Monomoy Construction Services, or MCS, and combined the assets of Greenfield with the assets of our Monomoy BTS Construction Management Consulting business. MCS meaningfully bolsters our real estate platform by creating a fully integrated, full-service construction vertical to serve our existing asset management entities. Our close relationship with the Greenfield team has made for a seamless integration with Monomoy. MCS also expands our owner rep consulting services with third parties, a majority of which are sourced from existing relationships within the Monomoy ecosystem.

This adds accretive revenue opportunities and enhances operational efficiencies through the economies of scale, delivering revenue and operational synergies from Greenfield acquisition. With a large backlog and existing civil engineering and land planning talent, we are now able to offer an expanded range of services and fortify our overall real estate value proposition to our investors and clients. Additionally, Monomoy REIT continues to execute and maintain solid activity throughout the quarter. We acquired a property for approximately $3 million during the quarter and continue to maintain a strong pipeline of transaction opportunities and open requirements from our tenants. Outside of our core businesses, we have made significant progress in repurchasing GEG shares under our $20 million buyback program.

Through May 6, 2025, we have repurchased approximately 4.8 million shares for $8.7 million at an average cost of $1.84 per share, representing approximately a 15% discount to the quarter end book value per share of $2.14. Before Keri reviews our financial results in more detail, I would like to note that the net loss in the quarter was primarily driven by unrealized losses related to our investments in CoreWeave and GECC shares, both marked the lower at quarter end amid broader market volatility. We remain highly confident in these investments and fully expect the losses to reverse over time as market conditions stabilize. While uncertainty can drive asset price volatility in the near term, it can also create very attractive entry points into investment opportunities.

Our strong liquidity position with approximately $32 million of cash at quarter end puts us in an advantageous position when market volatility presents. In addition, unique investments like the convertible preferred financing we provided for CoreWeave prior to its public listing and the private fund managed by Stone Ridge Asset Management, a best-in-class reinsurance manager, are a testament to the strength of our sourcing capabilities, both through our experienced Board of Directors and our network of investment partners more broadly. Our ample liquidity, combined with our unique sourcing capabilities, enables us to support future growth initiatives across our alternative asset management platform. In closing, we are pleased with the performance of our credit and real estate businesses this quarter.

The acquisition of Greenfield CRE strengthens our real estate capabilities while providing revenue and cost synergies. And GECC’s continued growth demonstrates our momentum in credit. As always, we remain focused on our core objectives, enhancing financial performance, expanding our platform and growing AUM. Looking ahead, we will continue to evaluate strategic opportunities to expand our businesses and add accretive differentiated product offerings with attractive risk-adjusted return profiles. With that, I’ll turn it over to Keri.

Keri Davis: Thank you, Jason. I will provide a brief overview of the quarter and of course, welcome all of you to review our filings in greater detail or reach out to our team with any questions. Fiscal third quarter revenues grew 15% to $3.2 million from the prior year period, primarily driven by increased revenues from real estate project management fees and rental income, as well as increased management fees from GECC attributable to fee-paying AUM growth. AUM and fee-paying AUM totaled approximately $768 million and $565 million, respectively, up 12% and 15%, respectively, from the prior year quarter end. Great Elm Group generated net loss of $4.5 million for the quarter as compared to net loss of $2.9 million for the prior year period.

The net loss was primarily driven by unrealized losses related to certain investment positions marked down at quarter end, which we expect to reverse over time as market conditions stabilize. Adjusted EBITDA for the quarter was $0.5 million compared to $1.2 million in the prior year period. As of March 31, we had approximately $32 million in cash on our balance sheet to deploy across our growing alternative asset management platform. Please refer to Slide 6 that provides an overview of our financial position and highlights our book value per share of approximately $2.14. This concludes my financial review of the quarter. With that, we will turn the call over to the operator to open for questions.

Operator:

Jason Reese: Thank you again for joining us today. We look forward to speaking with you in the future.

Operator: Thank you. This concludes today’s teleconference. You may disconnect your lines at this time. Thank you for your participation.