Good morning, ladies and gentlemen. Welcome to Flow Capital Corp.'s earnings call for Q4 and year-end 2023. At this time, all participants are in a listen-only mode. Following the presentation, we will conduct a question-and-answer session. Instructions will be provided at that time for you to queue up for questions. If anyone has any difficulties during the conference, you may press star zero for operator assistance at any time. I would like to remind everyone that today's discussions may contain forward-looking statements that reflect current views with respect to future events. Any such statements are subject to risks and uncertainties that could cause actual results to differ materially from those projected in the forward-looking statements. For more information on Flow Capital's risks and uncertainties related to these forward-looking statements, please refer to the Q4 and year-end 2023 Company's Management Discussion and Analysis, which is available on SEDAR.
Today's call is being recorded on Tuesday, April 30th, 2024. I would now like to turn the meeting over to Alex Baluta, Chief Executive Officer of Flow Capital. Please go ahead.
Thank you, Joanna. Good morning, everybody, and thank you all for participating in today's call or for listening to the recording. I'm joined by Michael Denny, our Chief Financial Officer. After the close of market yesterday, we released our financial results for the quarter and the year ended December 31st, 2023. Details can be found on our website at flowcap.com or as filed on SEDAR. I will try to keep my comments relatively brief today. During Q4, we reported a record quarter in terms of recurring revenue, going as far back as at least December 2018. That's when we transitioned our strategy away from royalties and into growth debt and changed our name to Flow Capital. I will not be going through the full financial statements on this call, but rather we'll focus on a few of the relevant highlights.
If you'd like more detail, I strongly encourage you to read the statements, as I said, that are on our website or filed on SEDAR. Recurring interest revenue for Q4 was CAD 1.65 million, up over 15% compared to the prior year. For the year as a whole, recurring revenue, recurring interest revenue was down slightly to CAD 6.1 million, driven by slow investment deployments in the first half of the year, as well as early repayment of several deals late in the prior year. As a quick aside, I have repeatedly pointed out on every call, and it's worth noting again, that our definition of recurring revenue is a non-IFRS metric. Excuse me. For Flow, recurring revenue means cash revenue generated from our investments.
Our total reported revenue under IFRS was actually CAD 1.1 million in the quarter and CAD 5.8 million for the year. However, IFRS revenue can be slightly distorting and hard to follow, as under IFRS rules, changes in the balance sheet need to flow through the income statement, which can lead to things like negative revenue in a quarter, making it hard to track the real performance of our core business. That's why we talk about recurring revenue and recurring free cash flow, which we believe are better metrics to track. Our current recurring revenue growth in Q4, as an example, was a function of strong capital deployments in the second half of 2023.
Recurring cash flow, another non-IFRS metric, which we define as recurring revenue less cash expenses and cash interest costs, was a positive CAD 338 thousand in Q4, up strongly from the Q4 last year. For the full year, recurring cash flow was down from CAD 1.3 million to CAD 1 million, driven primarily by increase in our cost of capital. Sorry, we moved to a floating interest rate on our debenture, which was over 1% higher than what we were paying in 2022. We expect that as rates come down, our cost of capital and what we pay in our debenture will also come down, as it's a floating rate. During the year, we had two loan repayments totaling approximately CAD 10 million.
IRR on those deals was in the range of 21.5% on one deal and 36.2% on another. It's worth noting that we still have equity warrant positions in both companies. Usually, our loans have a duration of three years, but our warrants have a term of 5-10 years. Total assets ended the year at CAD 63.6 million, another record going back at least six years, up from CAD 58.7 million last year. We ended the year with just over CAD 5 million in cash, but note that that did not include roughly $6 million from one of the repayments that I prior just mentioned, that actually hit our bank accounts on January 2nd, 2024. During the year, the portfolio performed well, and we had no new non-performing loans.
We do have a loan that we have been restructuring for some time, and that ceased payments, which negatively impacted Q4 revenue, but this was not a new distressed situation. It's an ongoing workout. Book value was down a few pennies year-over-year to CAD 1.19 per share. This was due primarily to warrant revaluations. The warrant valuation decline was itself a reflection of the broad and material contraction in equity valuations that we've seen over the past 15-18 months. As you know, we regularly mark to market, as best we can define the market, our warrants.... OpEx has remained consistent at approximately CAD 3 million per year, ± CAD 100,000 for the past four years.
Over that time, going back to Q1 2020, we've grown quarterly revenue from CAD 1 million to almost CAD 1.7 million, up almost 70%, and we've grown book value per share by almost 160% to CAD 1.19. I think we've handily outperformed pretty much any relevant benchmark when it comes to book value per share growth. From a profitability perspective, Q4 marked the 15th sequential quarter that we've been free cash flow positive, going all the way back to Q1 2020. We have been efficient operators, and we will continue to improve our operational efficiency every quarter. As we scale our business, I fully expect that we'll remain profitable even as we grow our top line.
While we have continued to improve our internal processes and efficiency over time, the primary reason for the strong track record of generating positive free cash flow has been a relentless focus on doing excellent, high quality deals. As we approach our sixth anniversary of transitioning from royalties to focusing on providing growth debt to high, fast, high-growth, fast scaling companies, our investment IRR to the end of Q4 remains in the high 20% range. Please keep a lookout for an upcoming press release in the coming weeks, where we will be releasing more detail on our six-year IRR performance numbers. This IRR performance is also the result of a deeply ingrained focus on deal quality and risk mitigation.
Philosophically, we target zero zeros, as in zero defaults, which is a shorthand way of reminding everybody on our team here that it is very hard to make up a capital loss based on the net spread of the rest of the portfolio, although warrants can help make up such losses. We therefore do extensive due diligence, and we are very picky in our investments. This pickiness really means that our close rate remains at less than 1% from top to bottom. So for every 100 deals that come into the top of the funnel, we close on less than one of them. And if you look even deeper into the funnel, we only close on approximately 1/3 of the deals that we sign a term sheet for. So if we sign three term sheets, we'll close one of those.
So in spite of this pickiness, we have seen strong capital deployment over the last 12 months. Specifically, over the past month, 12 months through April 2024, we've deployed over CAD 22 million into new investments. And this is one of our core focuses going forward, to continue to grow our investments into well-managed, high-growth, and occasionally venture-backed companies. Another highlight during 2023 was the conversion of our Priority Return Fund into a high yield, retractable, redeemable debenture. This is an on-balance sheet debenture that provides our debenture investors with a floating rate of interest, currently at 10.5%, redeemability, RRSP eligibility, and seniority at almost CAD 38 million in equity. The market reaction to this debenture has been very positive, and we expect this structure will help us grow our asset base for the foreseeable future.
From a pipeline perspective, we continue to see many high quality opportunities. I've mentioned before, this is a trend that we started to see in late 2022, and it continued into 2023 and into early 2024. This has been driven by a few factors, including the equity markets drying up, and that's both public equity and private equity. Venture capitalists wanting to avoid a down round, companies focusing less on burn and higher, more focused on profitability, which often means slightly lower growth. We can kind of add a fourth driver more recently, which is VCs focusing on investing billions and looking for AI unicorns.
All this means that companies might be strapped for capital and don't have equity options, and that leaves good small and mid-sized companies who really need the money, turning to growth debt providers, such as ourselves. To be a bit more specific, in terms of high quality leads, we saw 55 such companies in 2023, up from 36 such companies in 2022. Finding new ways to continue to grow our pipeline, both at the top of the pipeline and in terms of high quality leads, is a key strategic focus for us going into 2024. Quick mention on the warrant side. We now hold 23 warrants, equity or bonus on equity-type positions, and this portfolio will continue to grow as we make more deployments.
As I said, the average duration of these warrants is between 5-10 years, averaging around six. These warrants and equity positions have been meaningful contributors to our IRR performance over the last five years. It's worth noting that our deal structure generally leads us to owning somewhere between 1%-3% of these high growth companies. I'll remind you, we focus primarily on SaaS tech software companies, and some of these companies will eventually become large, excellent, well-performing companies, and, hopefully, we continue to own 1%-3% of each of those companies. On the slightly disappointing side, it's worth mentioning that we lost our legal battle against a former royalty investment.
Without going into too much detail, if this deal was in front of the courts today, we would have won a judgment for well over CAD 4 million based on new laws recently put into place in Canada. While it's disappointing that we did not win, the good news is that we were carrying this investment at a very conservative valuation, and there will be no negative book value impact, even as we collect almost CAD 1.5 million in the coming weeks. Next, a quick update on our NCIB. In our Normal Course Issuer Bid ending in October 2023, we purchased almost 2 million shares for approximately CAD 1.1 million. So an average price of approximately CAD 0.56.
I wanna point out that over the last five years, we've continued to repurchase shares and in aggregate, purchased somewhere in the range of 15 million shares, spending approximately CAD 8 million to do so. As I've said in the past, given the market discount of the share price relative to our book value, we will continue to buy back our stock, essentially buying dollars for 50 cents, primarily because we're exceptionally strong believers in our future. Finally, I want to give a quick nod to our team. The team we have assembled, in which we continue to grow, is amazing. It's their hard work and relentless focus on quality and on generating meaningful shareholder returns, which has gotten us to this point.
With their help and with the addition of new star players, we will stay laser focused on continuing to grow both our top and bottom line, and on generating an excellent risk-adjusted return for all of our stakeholders. With that, I'll end my prepared statements, and I will turn it back to the operator, Joanna. Thank you.
Thank you. Ladies and gentlemen, we will now begin the question and answer session. Should you have a question, please press the star followed by the one on your touchtone phone. You will hear a prompt that your hand has been raised. Should you wish to decline from the polling process, please press star followed by two. If you are using a speakerphone, please lift the handset before pressing any keys. Ladies and gentlemen, as a reminder, if you have any questions, please press star one now. We do have a question from Ed Sollbach from Spartan. Please go ahead.
Good morning. Hey, Alex. Congrats on all the new business you've won. Look forward to that in coming quarters. Any thoughts about putting out, like, an adjusted earnings number or something? Because if I look, like, just at the annual numbers, I see, you know, 322-
Ed, we've lost you there. Operator, I... Ed, if you-
It seems like Ed's line has disconnected, and we have no further questions.
Okay, so I think I know what he was asking. We do, we do focus on recurring revenue, recurring free cash flow, but the earnings that we put out do conform to IFRS. And Ed, if you're asking for an adjusted earning, we can do that as well. Really comes down to the cash flow that we're generating. We don't have a lot of non-operating expenses, meaning amortization type expenses. So I think if you just look at that cash flow number, that'll give you a very good idea of our adjusted earnings. Look, we can always discuss this in more detail. Feel free to call me or Michael, our CFO, at any time. That's it, Joanna.
Thank you. We have no further questions.
Thank you, Joanna, and thank you, everybody else, for listening and look forward to talking again in a couple of weeks for Q1. Thank you.
Ladies and gentlemen, this concludes your conference for today. We thank you for participating, and we ask that you please disconnect your lines.