Good morning, ladies and gentlemen, and welcome to Flow Capital Corp's Earnings Call for the Q3 2023. At this time, all participants are in a listen-only mode. Following the presentation, we'll conduct a question-and-answer session. Instructions will be provided at that time for you to queue up for questions. If anyone has difficulties hearing 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 company's management discussion and analysis dated November 21st, 2023, which is available on SEDAR.
Today's call is being recorded on Wednesday, November 22nd, 2023. I would now like to turn the meeting over to Alex Baluta, Chief Executive Officer of Flow Capital.
Thank you, operator, and thank you, everybody, for joining. Good morning. I'm joined by Michael Denny, our Chief Financial Officer. After the close of market yesterday, we released our financial results for the third quarter, ended September 30th. Details can be found on our website, flowcap.com, or as filed on SEDAR. For Q3, we had a flat quarter that was in line with our expectations. I will not be going through the full financial statements on this call, but we'll focus on a few highlights. If you'd like more detail, I would encourage you to read our full financial statements that you can find on our website or on SEDAR. Recurring investment revenue was CAD 1.5 million, up slightly from the prior quarter. As I've mentioned several times in the past, our definition of recurring revenue is a non-IFRS metric.
Our total revenue under IFRS was actually CAD 1 million. However, IFRS revenue can be slightly distorted and hard to follow, as under IFRS, changes in balance sheet items need to flow through the income statement, and that can lead to things like negative revenue in a quarter, making it hard to track the real performance of our core business. This is why we talk about recurring revenue and recurring free cash flow, which we believe are better metrics to track. For the last few quarters, we've had relatively flat recurring revenue, as we've had several early repayments late last year and early this year, and our redeployment of capital earlier in the year had not kept up with those early repayments. However, that's now changed, and we're now deploying more capital, and we are starting to see growth in our revenue and more on that in a moment.
Recurring cash flow, another non-IFRS metric, defined as recurring revenue, less cash expenses and interest costs, was CAD 237,000 in the quarter, up from CAD 127,000 in Q2 and just over CAD 700,000 over the past four quarters. While slower redeployment of capital earlier in the year was holding back revenue growth, it was primarily because of our particular focus. We are particularly selective in the deals we choose to do. Philosophically, it's worth stating that we target zero zeros, as in zero defaults, as from our perspective, it's a challenge to earn back losses based on net spread of the rest of the portfolio. This deeply ingrained focus on quality and risk mitigation is one of the reasons why our five-year IRR track record is over 30%.
But we're finally starting to see traction on redeployment of capital. Our cash, by the way, was CAD 9 million at the end of the quarter, although today it sits at CAD 4 million. We have made several recent investments. So far this year in total, we deployed almost CAD 13 million into new senior secured loans in high-growth companies. All of these new investments carry an average cash interest rate higher than the rate we had a few years ago, reflecting the change in the broader interest rate environment that we're seeing today. And we can expect to see more deployments in the coming months. As I've been mentioning for several quarters now, our pipeline has been incredibly strong, and that strength continues. This pipeline strength is driven by, again, the broader changes in the investment landscape.
In particular, venture capitalists are simply not investing in companies that are either not pure AI or growing at over 100%. And those companies are hard to find, and that's not our target market. VCs are also desperately trying to avoid down rounds or reduced valuations in this current environment, which means they're often not supporting the existing portfolio companies. Yet many of those companies are on their way to becoming $10 million-$50 million revenue companies, but perhaps not on their way to becoming unicorns. That is our target market, is good growth companies. Add to this, that the public markets continue to essentially be closed, and raising capital or large amounts of capital of equity, from equity, for most companies is a challenge.
Yet there's a huge universe of great companies that are generating $5 million, $10 million, $20 million, $30 million in revenue that are at or near breakeven and, for whatever reason, need capital. And so companies like Flow are seeing those opportunities. As I did last quarter, I'd like to give you some stats to support what we're seeing in our pipeline. To give you an idea, normally we see approximately 900 leads per year, and we close on less than 1% of those leads, being quite selective. The key stage in our pipeline, we call it the IC or investment committee level, where they're fully qualified. They know us, and we know them, but we haven't started due diligence yet. This year, to date, we've had about 50 companies progress to the IC level in our pipeline, and that compares to about 31 for all of 2022.
I would not be surprised if we end the year at closer to 60. So far this year, we've issued 34 term sheets, we've signed 15, we've closed on 5 deals for approximately CAD 13 million. We've rejected five based on our due diligence, and we have five that are currently in various stages of due diligence. Of these last five, and subject to successful completion of due diligence, we expect to close on several of them in the coming months. As and when we do, our revenue and our free cash flow should resume growth. Looking at aggregate, at this point in the year, we've now deployed more capital than was repaid. What that means is that we should see stronger revenue in Q4 compared to the prior three quarters.
While we do have several upcoming maturities and repayments in the near term on the near-term horizon, we feel we have enough depth in our current pipeline that we should be able to deploy that capital, redeploy that capital fairly quickly. At least that's our plan. I mentioned in our past call our historical five-year performance and IRR. I discussed it in detail last quarter, but I do think it's worth mentioning again, mentioning again. As I said earlier, this year, we've rejected five deals in due diligence after signing a term sheet and completing due diligence. This selectivity and focus on quality is a good lead-in to discussion about our five-year performance. In June of this year, we issued a press release that summarized that five-year performance. At that time, the press release noted that we'd invested CAD 46 million into 16 portfolio companies.
That's now sitting at CAD 59 million into 20 companies. Over the past five years, on that investment of into 16 portfolio companies, we achieved an IRR of just over 30%. We recorded a loss ratio of less than 1%. We increased book value per share by over 170% from a low of CAD 0.45 per share in 2019, and in Q1 of this year, it was at CAD 1.23. Current book value is sitting at CAD 1.20. That is down slightly because primarily due to dilution from options and warrants earlier as option warrant conversion earlier in the year. We've been generating positive EBITDA and positive free cash flow for over three years, and that continued this quarter.
We repurchased, over that last five years, approximately 14 million shares or 32% of the shares outstanding at a weighted average discount of approximately 50% to book value. It's worth noting that in mid-October of this year, we completed our prior NCIB, or NCIB stands for Normal Course Issuer Bid. Over the past 12 months, we've repurchased just under 2 million shares for approximately CAD 1.1 million at an average price of approximately CAD 0.56 per share. And as I said, our book value is at CAD 1.20. You likely have seen a press release from earlier this week, where we announced that we are initiating a new NCIB that starts at the end of this week, and it is authorized to repurchase approximately 2.4 million shares over the next 12 months.
As I said last quarter, the five-year performance that we generated is remarkable, and it's really a testament to the team, our process, our investment strategy, and our focus. While our returns might not be that high in the future, we are targeting mid-20% longer-term IRR. In terms of how we generate such returns, it's as a reminder, we lend money primarily for growth in the form of senior secured loans to high growth companies, and those companies are primarily in the tech space. We focus on high growth, and by that we mean greater than 20% revenue growth, because these high growth companies, in addition to being able to pay our cash interest, can generate disproportionately large returns in equity, and that provides a little bit of equity outside for us. So we also take warrants in our investments.
That's in addition to taking a mid-teens interest rate. And generally, we end up owning, through those warrants, 1%-3% of the companies that we invest in. It's through both the cash interest repayments as well as gains on our warrants and sometimes bonus payments, that we've generated that 30% IRR. I also wanted to mention our new redeemable, retractable debenture that was launched earlier this year. This debenture should help us capitalize on the quality and volume of deals that we're seeing and help us scale our business to much greater portfolio size. The debenture specifically pays a floating rate of interest. The F Series currently pays 10.5%, and that's capped at 12% with a floor of 8%, depending on underlying interest rates.
For holders of greater than CAD 1 million, it currently pays 11%, which is additional 50 basis points of interest. It's RRSP eligible. It is retractable by the holder on 90 days' notice, and very importantly, it sits senior to almost CAD 40 million of equity on our balance sheet. The fact that this debenture has almost CAD 40 million of subordinate equity, subordinated equity below it is worth highlighting. Most other players in this space do not provide that kind of coverage. We are hopeful that this structure will appeal to investors as we plan on using this vehicle to raise capital to help us scale our business to grow our portfolio. Finally, joining me on the call today is Michael Denny, our new CFO.
Michael has over 25 years of experience in investment banking, and most recently, he was managing director of a private equity manager, Lynx Equity, where he managed their Lynx Equity Income Trust. He brings a mix of investment, financial, capital raising skills that we think will help continue to scale our business. Like me, he is always available to answer any questions you might have. And with that, I'd like to turn it back to the operators, the operator for questions.
Thank you. Ladies and gentlemen, should you have a question, please press the star followed by the one on your touch-tone phone. If you'd like to withdraw your question, please press the star followed by the two. If you're using a speakerphone, please lift the headset before pressing any keys. To ask a question, press star one. There are no questions at this time. I will turn the call back over to Alex.
Thank you very much, operator. Thank you, everybody, for participating in the call. My email, in case you want to contact me directly, is alex@flowcap.com or michael@flowcap.com, if you'd like to contact our CFO. We appreciate your participation, and we look forward to speaking to you again, after our Q4 results. Thank you very much.
Ladies and gentlemen, this concludes your conference call for today. We thank you for joining, and you may now disconnect your lines. Thank you.