Omni Opthalmic Management Consultants: Placed On Non-Accrual

Downgraded From CCR 2 To CCR 5 And Becomes An Important Underperformer

August 25, 2025

Out of the blue, this health care services company has gone from - apparently - performing as expected to being placed on non-accrual by its only BDC lender, Crescent Capital (CCAP) in the IIQ 2025.. Try as we might - which includes multiple queries of the public record - we've not been able to determine what ails the business. Even CCAP - on its IIQ 2025 conference call didn't have anything useful to say.

The company's debt was coming up to its maturity in September 2025, which may have precipitated the move. We also note that the BDC added a Revolver in March 2025, which suggests extra liquidity might have been needed. Anyway, as of now $9.4mn of debt at cost - with the puzzling exception of another Revolver on the books - is non-performing and discounts have been applied as high as (12%).

Of course, that's not a very big discount and implies CCAP - and other lenders that may be involved - are optimistic that this problem is solvable. At CCAP that means only ($1.1mn) of unrealized loss was recognized in the IIQ 2025. However, ($1.1mn) of annual interest income has been forgone for an unknown period.

Given we know so little, we'll let ourselves be guided by CCAP's valuation in estimating what an ultimate loss might look like. We're presuming 0%-25% of cost, if at all. As noted we have downgraded the company from CCR 2 to CCR 5 and to Important Underperformer status.

Funny

On its latest conference call, the management of CCAP was arguing that their credit approach might be more conservative than its peers - faster to write down troubled companies than others. In this case, though, the borrower has gone from performing to non-performing very quickly and with little of a heads up from the prior CCAP valuation. We'll be curious to see how this all plays out in the quarters ahead and whether this modest write-down of a non-accrual proves justified. These sorts of issues speak to the credibility of the BDCs involved and can be usefrul indicators over the long term.

By the way, on this most recent conference call, CCAP's management very deliberately referenced its long term credit performance - making the case that investors and analysts should not get caught up in recent credit setbacks:

...Let's look at performance since CCAP's public listing in February 2020, a period that captures the totality of the COVID pandemic, the rise in interest rates beginning in mid-2022, and at least part of the recent tariff volatility. Based on publicly available data, the average public BDC saw its net asset value per share declined by 10.5% from the fourth quarter of 2019 to the first quarter of this year. CCAP's NAV per share increased by 0.6% over the same time frame and 0.3% through Q2. Over this period, we generated a total economic return calculated as change in net asset value plus dividends of 49%, well in excess of the public BDC average. I highlight this longer-term track record as it often feels as if we operate in 90-day earnings vacuums where sentiment can swing wildly, sometimes warranted, sometimes not.  We do not believe CCAP's current discount to NAV is warranted,...

We are in the midst of undertaking the BDC's IIQ 2025 credit review and updating our database, which includes the just created Company File for Omni. Here is the Company Profile we've curated, which provides a useful briefing on the history, business and ownership of this latest CCAP non-accrual.