Equus Announces Third Quarter Net Asset Value

HOUSTON, Nov. 17, 2020 (GLOBE NEWSWIRE) -- Equus Total Return, Inc. (NYSE: EQS) (the “Fund” or “Equus”) reports net assets as of September 30, 2020, of $37.4 million, a decrease of approximately $4.1 million since June 30, 2020. Net asset value per share decreased to $2.77 as of September 30, 2020 from $3.07 as of June 30, 2020. Comparative data is summarized below (in thousands, except per share amounts):  

As of the Quarter Ended	9/30/2020		6/30/2020		3/31/2020		12/31/2019		9/30/2019
Net assets	$37,431		$41,469		$38,895		$45,989		$49,024
Shares outstanding	13,518		13,518		13,518		13,518		13,518
Net assets per share	$2.77		$3.07		$2.88		$3.40		$3.63

The following were the portfolio companies that experienced changes in their fair values during the third quarter of 2020:

• Decrease in the Value of PalletOne.   Equus holds a 17.1% share interest in PalletOne, Inc. (“PalletOne”), one of the nation’s largest wooden pallet manufacturers and a major supplier of treated lumber in the southeastern United States.   The fair value of the Fund’s share interest in PalletOne decreased from $27.5 million to $24.0 million during the third quarter of 2020. During the second and third quarters of 2020, unprecedented consumer demand for treated wood lead to record revenue and EBITDA in PalletOne’s treating division. This demand caused a sharp rise in lumber prices, which reached record levels in the third quarter of 2020, only to decline rapidly at the end of the quarter. Going into the fourth quarter, this decline is expected to result in losses from the resale of PalletOne’s inventories of treated wood. In addition, certain key capital projects of PalletOne were adversely impacted by COVID-19 related travel disruptions that affected the company’s European-based partners and equipment suppliers. The decrease of $3.5 million in the fair value of the Fund’s holding in PalletOne during the third quarter of 2020 was also consistent with those of comparable companies in the sector.   The Fund received advice and assistance from a third-party valuation firm to support its determination of the fair value of this investment. (see A Note About the Coronavirus and Other Events below).