Gladstone Investment Corporation Reports Financial Results for its Third Quarter Ended December 31, 2016
February 06 2017 - 4:12PM
Gladstone Investment Corporation (NASDAQ:GAIN) (the “Company”)
today announced earnings for its third quarter ended December 31,
2016. Please read the Company’s Quarterly Report on Form 10-Q
filed today with the U.S. Securities and Exchange Commission (the
“SEC”), which can be retrieved from the SEC’s website at
www.sec.gov or from the Company’s website at
www.gladstoneinvestment.com.
Summary Information:
(dollars in thousands, except per share data (unaudited)):
|
December 31,2016 |
|
September
30,2016 |
|
Change |
|
|
%Change |
|
For the quarter ended: |
|
|
|
|
|
|
|
|
|
|
Total
investment income |
$ |
13,374 |
|
|
$ |
11,744 |
|
|
$ |
1,630 |
|
|
13.9 |
% |
Total
expenses, net |
8,170 |
|
|
|
6,632 |
|
|
1,538 |
|
|
23.2 |
|
Net
investment income |
5,204 |
|
|
|
5,112 |
|
|
92 |
|
|
1.8 |
|
Net
realized loss |
(3,137 |
) |
|
|
(193 |
) |
|
(2,944 |
) |
|
NM |
|
Net
unrealized appreciation (depreciation) |
8,888 |
|
|
|
(5,021 |
) |
|
13,909 |
|
|
NM |
|
Net
increase (decrease) in net assets resulting from operations |
10,955 |
|
|
|
(102 |
) |
|
11,057 |
|
|
NM |
|
Net
investment income per common share |
0.17 |
|
|
|
0.17 |
|
|
— |
|
|
— |
|
Cash
distribution per common share |
0.19 |
|
|
|
0.19 |
|
|
— |
|
|
— |
|
|
|
|
|
|
|
|
|
|
|
|
Distributions coverage ratio(A) |
232.3 |
% |
|
|
235.4 |
% |
|
(3.1 |
)% |
|
(1.3 |
) |
Weighted
average yield on interest-bearing investments |
12.7 |
|
|
|
12.5 |
|
|
0.2 |
|
|
1.6 |
|
Total
dollars invested |
$ |
— |
|
|
$ |
2,210 |
|
|
$ |
(2,210 |
) |
|
(100.0 |
) |
Total
dollars repaid and collected from sales |
18,534 |
|
|
|
2,198 |
|
|
16,336 |
|
|
743.2 |
|
|
|
|
|
|
|
|
|
|
|
|
As
of: |
|
|
|
|
|
|
|
|
|
|
Total
investments, at fair value |
$ |
471,440 |
|
|
$ |
485,972 |
|
|
$ |
(14,532 |
) |
|
(3.0 |
)% |
Fair
value, as a percent of cost |
94.5 |
% |
|
|
93.0 |
% |
|
1.5 |
% |
|
1.6 |
|
Net
assets |
$ |
297,382 |
|
|
$ |
292,102 |
|
|
$ |
5,280 |
|
|
1.8 |
|
Net asset
value per common share |
9.82 |
|
|
|
9.65 |
|
|
0.17 |
|
|
1.8 |
|
Number of
portfolio companies |
35 |
|
|
|
36 |
|
|
(1 |
) |
|
(2.8 |
) |
|
|
|
|
|
|
|
|
|
|
|
(A) Distributions coverage ratio is
calculated by dividing the sum of net investment income in excess
of distributions at the end of the period and distributions to
common stockholders during the period by current period
distributions to common stockholders. |
|
|
|
|
|
|
|
|
|
|
|
NM = Not
Meaningful |
|
|
|
|
|
|
|
|
|
|
Highlights for the Quarter: During the
quarter ended December 31, 2016, the following significant events
occurred:
- Portfolio Activity:-Exited one investment,
which resulted in full repayment of our debt investment of $10.0
million, success fee income of $0.9 million, and a net realized
gain of $5.8 million.-Restructured one investment, which resulted
in the exchange of debt with an aggregate cost basis of $16.5
million for a new $8.8 million secured first lien term loan,
relinquished our preferred equity with a cost basis of $2.5
million, and relinquished a portion of our common equity with a
total cost basis of $3. The transaction resulted in a realized loss
of $10.2 million.
- Line of Credit Amendment: Entered into
Amendment No. 2 to the Fifth Amended and Restated Credit Agreement
with Keybank National Association, Alostar Bank of Commerce,
Manufacturers and Traders Trust, East West Bank, Chemical Bank, and
Customers Bank on November 16, 2016.
- Distributions and Dividends: Paid the
following monthly cash distributions to common and preferred
stockholders for each of October, November, and December
2016:-$0.0625 per common share, per month;-$0.140625 per share, per
month, for the Company’s 6.75% Series B Cumulative Term Preferred
Stock (“Series B Term Preferred Stock”);-$0.135417 per share, per
month, for the Company’s 6.50% Series C Cumulative Term Preferred
Stock (“Series C Term Preferred Stock”);-$0.13020833 per share to
holders of our 6.25% Series D Cumulative Term Preferred Stock
(“Series D Term Preferred Stock”) for each of November and December
2016, and also paid a combined dividend for the pro-rated period
from and including the issuance date, September 26, 2016, to and
including September 30, 2016 and the full month of October 2016,
which totaled $0.15190972 per share, to the holders of the Series D
Term Preferred Stock.
Third Quarter Results:
Net investment income for the quarters ended December 31, 2016 and
September 30, 2016, was $5.2 million, or $0.17 per share, and $5.1
million, or $0.17 per share, respectively, an increase of 1.8%. The
increase in net investment income period over period was primarily
due to higher other income, which was partially offset by an
increase in total expenses net of credits, including higher
incentive fees.
Net asset value per common share as of December 31, 2016
increased to $9.82 compared to $9.65 as of September 30, 2016. The
quarter over quarter increase was primarily due to $8.9 million of
net unrealized appreciation, which was due to the reversal of
previously recorded net unrealized depreciation related to
restructures and exits and an increase in performance of certain of
our portfolio companies, partially offset by net realized losses
related to the restructures and exits.
Subsequent Events: After
December 31, 2016, the following significant events occurred:
- Distributions and Dividends Declared: In
January 2017, our Board of Directors declared the following monthly
cash distributions and dividends:
Record Date |
|
Payment Date |
|
Distribution per Common Share |
|
Dividend per Series B Term Preferred
Share |
|
Dividend perSeries C Term
Preferred Share |
|
Dividend perSeries D Term
Preferred Share |
|
January 20, 2017 |
|
January 31, 2017 |
|
$ |
0.0625 |
|
$ |
0.140625 |
|
$ |
0.135417 |
|
$ |
0.13020833 |
|
February 16, 2017 |
|
February 28, 2017 |
|
0.0625 |
|
0.140625 |
|
0.135417 |
|
0.13020833 |
|
March
22, 2017 |
|
March
31, 2017 |
|
0.0625 |
|
0.140625 |
|
0.135417 |
|
0.13020833 |
|
|
|
Total for the Quarter: |
|
$ |
0.1875 |
|
$ |
0.421875 |
|
$ |
0.406251 |
|
$ |
0.39062499 |
|
Conference Call: The Company will hold
its earnings release conference call on Tuesday, February 7, 2017,
at 8:30 a.m. EST. Please call (855) 376-7516 to enter the
conference. An operator will monitor the call and set a queue for
any questions. A replay of the conference call will be available
through March 7, 2017. To hear the replay, please dial (855)
859-2056 and use the playback conference number 56278911. The
replay will be available beginning approximately one hour after the
call concludes. The live audio broadcast of the Company’s quarterly
conference call will also be available online at
www.gladstoneinvestment.com. The event will be archived and
available for replay on the Company’s website through April 7,
2017.
About Gladstone Investment
Corporation: Gladstone Investment
Corporation is a publicly traded business development company that
seeks to make secured debt and equity investments in lower middle
market businesses in the United States in connection with
acquisitions, changes in control and recapitalizations. The
Company has paid 139 consecutive monthly cash distributions on its
common stock. Information on the business activities of all the
Gladstone funds can be found at www.gladstonecompanies.com.
To obtain a paper copy of our Quarterly Report on Form 10-Q
filed today with the SEC, please contact the Company at 1521
Westbranch Drive, Suite 100, McLean, VA 22102, ATTN: Investor
Relations. The financial information above is not
comprehensive and is without notes, so readers should obtain and
carefully review the Company’s Form 10-Q for the quarter ended
December 31, 2016, including the notes to the consolidated
financial statements contained therein.
Investor Relations Inquiries: Please visit www.gladstone.com or +1-703-287-5893.
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