- GAAP net investment income of $0.19 per
share providing distribution coverage of 106%
- Net asset value (NAV) increased 1.3% or
$0.11 per share from $8.22 to $8.33 per share on a
quarter-over-quarter basis
- Net leverage of 0.47x and liquidity at
over $400 million, subject to leverage and borrowing base
restrictions
- Actively managed liabilities in the
second quarter having issued approximately $144 million of 5.00%
unsecured convertible notes, redeemed $17 million of 6.60% senior
secured notes, repaid $15 million of L+3.25% term loan, and
received a maturity extension on our revolving credit facility to
2022
BlackRock Capital Investment Corporation (NASDAQ:BKCC) (“BCIC”
or the “Company,” “we,” “us” or “our”) announced today that its
Board of Directors declared a quarterly distribution of $0.18 per
share, payable on October 2, 2017 to stockholders of record at the
close of business on September 18, 2017.
“During the second quarter, we effectively managed our
liabilities by (i) issuing $143.8 million of 5.00% unsecured
convertible notes due 2022, (ii) redeeming $17 million of our 6.60%
senior secured notes, (iii) prepaying $15 million of our L+3.25%
term loan due 2019 and (iv) extending the maturity on our revolving
credit facility by more than one year to June 2022. I am pleased
with our current debt maturity profile and low levered balance
sheet as the combination of the two provide us with sufficient
operating flexibility for the next several years,” commented
Michael J. Zugay, CEO of BlackRock Capital Investment
Corporation.
“Our team continues to work diligently to rotate out of certain
legacy investments and to deploy capital into interest earning
assets. The current market conditions for leveraged loans can be
generally categorized as having tighter pricing, higher leverage
levels and weaker structures than in recent periods. As such, we
remain highly selective of new investment opportunities, and
continue to increase our investment into BCIC Senior Loan Partners
(“Senior Loan Partners”) and Gordon Brothers Finance Company, both
of which have underlying investments in diversified pools of
primarily first lien loans that generate attractive risk-adjusted
returns. We have also experienced a pickup in repayment activity in
our portfolio due to robust refinancing and M&A activity.”
Financial Highlights
Q2 2017 Q1 2017 Q2 2016
Total Per Total Per
Total Per ($'s in millions, except per
share data) Amount Share
Amount Share Amount
Share Net Investment Income/(loss) $ 13.9 $ 0.19 $
14.6 $ 0.20 $ 21.6 $ 0.30 Net realized and unrealized
gains/(losses) $ 3.1 $ 0.04 $ (0.2 ) $ (0.00 ) $ (31.2 ) $ (0.43 )
Basic earnings/(loss) $ 17.0 $ 0.23 $ 14.3 $ 0.20 $ (9.6 ) $ (0.13
) Distributions declared $ 13.1 $ 0.18 $ 13.1 $ 0.18 $ 15.2 $ 0.21
Net Investment Income/(loss), as adjusted1 $ 13.9 $ 0.19 $
14.6 $ 0.20 $ 21.6 $ 0.30
Basic earnings/(loss), as adjusted1
$ 17.0 $ 0.23 $ 14.3 $ 0.20
$ (9.6 ) $ (0.13 )
As of As of As of As of June
30, March 31, December 31, June 30,
($'s in millions, except per share data) 2017
2017 2016 2016
Total assets $ 925.0 $ 990.9 $ 957.1 $ 1,036.8 Investment
portfolio, at fair market value $ 893.3 $ 938.8 $ 931.1 $ 1,011.9
Debt outstanding $ 295.5 $ 370.9 $ 335.7 $ 348.1 Total net assets $
607.5 $ 598.4 $ 596.3 $ 661.4 Net asset value per share $ 8.33 $
8.22 $ 8.21 $ 9.13
Net leverage ratio2
0.47x
0.56x 0.55x 0.52x
_________________
1 Non-GAAP basis financial measure. See Supplemental
Information on page 8. 2 Calculated less available cash and
receivable for investments sold, plus payable for investments
purchased and unamortized debt issuance costs.
Business Updates
- On April 17, 2017, we redeemed $17.0
million aggregate principal amount of 6.60% senior secured notes
due 2018 (“6.60% Notes”), using proceeds from our senior secured
revolving credit facility. The notes were prepaid at 100% of the
principal amount, plus accrued and unpaid interest through the
prepayment date, as well as a $0.7 million make-whole premium.
Pursuant to this redemption, we no longer have 6.60% Notes
outstanding as of such date.
- On June 5, 2017, we entered into a
Second Amendment to the Second Amended and Restated Senior Secured
Revolving Credit Facility which extended the maturity date from
February 19, 2021 to June 5, 2022.
- On June 13, 2017, we issued $143.8
million in aggregate principal amount of 5.00% convertible notes
due 2022 (the “2022 Convertible Notes”) under an indenture, dated
as of June 13, 2017, as supplemented by a supplemental indenture,
dated as of June 13, 2017. This amount includes the overallotment
option which was fully exercised. The proceeds were used to repay
indebtedness under our revolving credit facility and for certain
fees and expenses related to the issuance. The 2022 Convertible
Notes will mature on June 15, 2022, unless previously converted,
repurchased or redeemed in accordance with their terms. Upon
conversion of a note, we will pay or deliver, as the case may be,
cash, shares of our common stock or a combination of cash and
shares of our common stock, at our election.
- On June 22, 2017, we repaid our entire
$15.0 million aggregate principal amount of L+3.25% senior secured
term loan due 2019 (the “Term Loan”), using proceeds from our
senior secured revolving credit facility. The Term Loan was prepaid
at 100% of the principal amount, plus accrued and unpaid interest
through the prepayment date, as well as a $0.2 million make-whole
premium.
- Our equity investment in Senior Loan
Partners is now generating a yield of approximately 11%. Senior
Loan Partners made investments into seven new portfolio companies
and three existing portfolio companies totaling $81.6 million of
new capital deployments during the quarter, bringing committed and
outstanding amounts to $177.1 million and $170.3 million,
respectively, and a total of 17 borrowers. The seven new
investments at par are (i) a $10.0 million first lien term loan to
Highline Aftermarket Acquisition, LLC, a distributor of branded and
private label automotive aftermarket consumables, (ii) a $12.5
million first lien term loan to Pretium Packaging, LLC, a leading
manufacturer and supplier of custom, high performance rigid plastic
containers used in a diverse range of end markets, (iii) an $11.5
million first lien term loan, a $2.5 million revolving loan and a
$1.0 million delayed draw term loan to Entertainment Partners, LLC
(“EP”), a leading provider of highly-specialized payroll processing
and production accounting services and software, (iv) a $10.0
million first lien term loan to Edgewood Partners Insurance Center,
a broker of commercial property and casualty, specialty program,
and employee benefits insurance, (v) a $13.8 million first lien
term loan to AP Exhaust Acquisition, LLC, a leading supplier of
exhaust, brake and chassis products in the US automotive
aftermarket industry, (vi) a $10.0 million first lien term loan to
National Spine and Pain Centers, LLC, a large group of
interventional pain management practices in the US and (vii) a
$10.0 million first lien term loan to AP Gaming I, LLC, a designer
and supplier of Class II and Class III electronic gaming machines,
table products and ancillary gaming equipment.
- As previously disclosed, last quarter
we provided a $3.0 million revolver and a $52.0 million first lien
term loan, priced at L+5.50%, to partially finance the sale of
Bankruptcy Management Solutions, Inc. (“BMS”) to its new private
equity owner. Pursuant to our plan to bring in other partners to
the financing, during the current quarter we sold $35 million of
the term loan at par. We continue to act as the agent on this
facility.
- Since the inception of our share
repurchase program through June 30, 2017, we have purchased 4.6
million shares at an average price of $7.98 per share, including
brokerage commissions, for a total of $36.3 million. There were no
share repurchases during the first half of 2017. The cumulative
repurchases since BlackRock Advisors, LLC entered into the
investment management agreement with the Company totaled
approximately 2.8 million shares for $24.0 million, representing
66% of total share repurchase activity, on a dollar basis, since
inception. As of June 30, 2017, the Company had approximately 2.0
million additional shares authorized for repurchase. In May 2017,
our Board of Directors approved an increase to the remaining amount
of shares authorized to be repurchased to a total of 2.5 million
shares effective July 1, 2017, and an extension to the plan until
the earlier of June 30, 2018 or such time that all of the
authorized shares have been repurchased.
Portfolio and Investment Activity*
($ in millions)
Three monthsendedJune 30,
2017
Three monthsendedMarch
31, 2017
Three monthsendedJune 30,
2016
Commitments $ 22.8 $ 122.3 $ 76.3 Investment
exits $ 72.0 $ 114.4 $ 161.4 Number of portfolio company
investments at the end of period 34 35 40 Weighted average yield of
debt and income producing equity securities, at fair market value
11.3 % 11.1 % 11.1 % % of Portfolio invested in Secured debt, at
fair market value 64 % 67 % 72 % % of Portfolio invested in
Unsecured debt, at fair market value 17 % 17 % 14 % % of Portfolio
invested in Equity, at fair market value 19 % 16 % 14 % Average
investment by portfolio company, at amortized cost (excluding
investments below $5.0 million) $ 33.0 $ 33.6
$ 33.3
* balance sheet amounts above are as of
period end
- We invested $22.8 million during the
quarter while sales, repayments and other exits of investments
totaled $72.0 million, resulting in a $49.2 million net decrease in
our portfolio due to investment activity. Approximately 73% of our
deployments during the quarter were represented by two portfolio
companies: (i) $10.7 million of incremental equity to Senior Loan
Partners and (ii) $5.9 million of incremental L+11.00% unsecured
debt to Gordon Brothers Finance Company. Nearly 80% of proceeds
from exits during the quarter were also represented by two
transactions: (i) selling $35.0 million of the BMS first lien term
loan to a 3rd party at par and (ii) a par repayment of our $20.0
million second lien investment in U.S. Anesthesia Partners, Inc.
(“USAP”).
- As of June 30, 2017, we continued to
have no investments on non-accrual, as compared with non-accruals
at 0.7% of our total debt investments at fair market value, and
5.4% at amortized cost at year end. Our average internal investment
rating at fair market value at June 30, 2017 was 1.34 as compared
to 1.31 as of the prior quarter-end.
- Net unrealized depreciation decreased
$3.1 million during the current quarter, bringing total balance
sheet unrealized depreciation to $37.8 million. During the quarter,
gross unrealized appreciation of $8.6 million was partially offset
by $4.6 million of gross unrealized depreciation, for a net $4.0
million of appreciation due to portfolio valuations. Additionally,
there was $0.9 million of unrealized depreciation during the
quarter due primarily to the reversal of previously recognized
unrealized appreciation on the USAP repayment.
Second Quarter Financial Updates
- GAAP net investment income (“NII”) was
$13.9 million, or $0.19 per share, for the three months ended June
30, 2017. Relative to distributions declared of $0.18 per share,
our NII distribution coverage was 106% for the quarter. Excluding
$1.1 million of net one-time expenses related to our debt
facilities (including make-whole premiums, unamortized debt
issuance costs and registration statement costs) net of an
insurance reimbursement related to a previously disclosed legal
settlement, NII for the second quarter would have been $0.21 per
share (rounded up), implying a 114% distribution coverage.
- Fee income earned on capital
structuring, prepayments and administration during the current
quarter totaled $0.1 million, as compared to $0.6 million earned
during the preceding quarter, and $4.1 million earned during the
prior year quarter. Excluding fee income and the abovementioned
insurance reimbursement, total investment income increased
approximately 1% compared to the prior quarter, and decreased
approximately 16% as compared to this quarter one year ago.
- In accounting for the 2022 Convertible
Notes at the time of issuance, the Company follows accounting
guidance that requires separately accounting for the debt and
equity components of such an instrument in a manner that reflects
the borrowing rate for a similar non-convertible debt instrument.
An equity component of $4.3 million represents the fair value of
the conversion feature, and an original issue discount equal to the
equity component was recorded as additional paid in capital in the
accompanying Consolidated Statement of Assets and Liabilities. The
accounting resulted in an increase to net asset value per share of
$0.06 at the time of issuance, and the corresponding original issue
discount will be amortized through net asset value over the life of
the note.
- As previously disclosed, our base
management fee rate was reduced from an annual rate of 2.00% of
total assets to 1.75% effective March 7, 2017. For the three months
ended June 30, 2017, $2.8 million of incentive management fees
based on income were earned, however, as previously disclosed, any
such fees earned until December 31, 2018 have been waived. The
cumulative amount of such incentive management fees waived since
March 7, 2017 is $3.6 million. During the quarter, there was no
accrual for incentive management fees based on gains. A
hypothetical liquidation is performed each quarter end resulting in
an additional accrual if the amount is positive or a reversal to
the existing accrual if the amount is negative. However, the
resulting fee accrual is not due and payable until June 30, if at
all. There is currently no balance accrued for incentive management
fees based on gains as of the measurement period ending June 30,
2017.
- As compared to the comparable 2016
period weighted average, our six month 2017 weighted average cost
of debt increased 113 bps to 5.36%. This was primarily driven by
(i) make-whole interest incurred in connection with the early
repayment of our $17.0 million 6.60% Notes and $15.0 million Term
Loan, (ii) lower average debt balances outstanding on our revolving
credit facility as a percentage of total debt and (iii) higher
Libor rates for the current period. Excluding make-whole and other
costs incurred in connection with the two early debt repayments,
the weighted average cost of debt for the six month period of 2017
was 4.75%.
- Tax characteristics of all 2016
distributions were reported to stockholders on Form 1099 after the
end of the calendar year. Our 2016 tax distributions of $0.73 per
share were comprised of ordinary income. Our return of capital
distributions since inception totaled $1.96 per share. At our
discretion, we may carry forward taxable income in excess of
calendar year distributions and pay a 4% excise tax on this income.
We will accrue excise tax on estimated undistributed taxable income
as required. There was no undistributed taxable income carried
forward from 2016. For more information on our GAAP distributions,
please refer to the Section 19 Notice that may be posted within the
Distribution History section of our website.
Liquidity and Capital Resources
- At June 30, 2017, we had total
liquidity of $409.7 million, consisting of $15.7 million in cash
and cash equivalents and $394.0 million of availability under our
credit facility, subject to leverage and borrowing base
restrictions, resulting in approximately $300 million of
availability for portfolio company investments.
- Net leverage, adjusted for available
cash, receivables for investments sold, payables for investments
purchased and unamortized debt issuance costs, stood at 0.47x at
quarter-end, and our 300% asset coverage ratio provided the Company
with available debt capacity under its asset coverage requirements
of $304.3 million. Further, as of quarter-end, 84% of our portfolio
was invested in qualifying assets, exceeding the 70% regulatory
requirement of a business development company.
Conference Call
BlackRock Capital Investment Corporation will host a
webcast/teleconference at 10:00 a.m. (Eastern Time) on Thursday,
August 3, 2017, to discuss its second quarter 2017 financial
results. All interested parties are welcome to participate. You can
access the teleconference by dialing, from the United States, (877)
874-1571, or from outside the United States, (719) 325-2394,
shortly before 10:00 a.m. and referencing the BlackRock Capital
Investment Corporation Conference Call (ID Number 9328605). A live,
listen-only webcast will also be available via the investor
relations section of www.blackrockbkcc.com. Both the teleconference
and webcast will be available for replay by 1:00 p.m. on Thursday,
August 3, 2017 and ending at 1:00 p.m. on Thursday, August 17,
2017. To access the replay of the teleconference, callers from the
United States should dial (888) 203-1112 and callers from outside
the United States should dial (719) 457-0820 and enter the
Conference ID Number 9328605.
Prior to the webcast/teleconference, an investor presentation
that complements the earnings conference call will be posted to
BlackRock Capital Investment Corporation’s website within the
Presentations section of the Investors page
(http://www.blackrockbkcc.com/phoenix.zhtml?c=209952&p=irol-disclaimer-presentations
).
About BlackRock Capital Investment Corporation
BlackRock Capital Investment Corporation is a business
development company that provides debt and equity capital to
middle-market companies.
The Company's investment objective is to generate both current
income and capital appreciation through debt and equity
investments. The Company invests primarily in middle-market
companies in the form of senior and junior secured and unsecured
debt securities and loans, each of which may include an equity
component, and by making direct preferred, common and other equity
investments in such companies.
BlackRock Capital Investment Corporation
Consolidated Statements of Assets and Liabilities
(Unaudited)
June 30,2017
December 31,2016
Assets Investments at fair value:
Non-controlled, non-affiliated investments (cost of $459,980,587
and $586,176,755) $ 440,116,069 $ 512,308,390 Non-controlled,
affiliated investments (cost of $166,118,461 and $112,640,458)
166,357,555 109,342,171 Controlled investments (cost of
$303,366,055 and $322,768,014) 286,790,297
309,472,929 Total investments at fair value (cost of
$929,465,103 and $1,021,585,227) 893,263,921 931,123,490 Cash and
cash equivalents 15,700,798 10,707,834 Receivable for investments
sold 1,789,143 449,578 Interest, dividends and fees receivable
10,244,804 10,750,723 Prepaid expenses and other assets
4,042,343 4,035,866 Total Assets $
925,041,009 $ 957,067,491
Liabilities
Debt 295,488,873 335,667,906 Interest payable 2,795,387 3,041,680
Distributions payable 13,127,773 15,262,010 Base management fees
payable 4,139,347 4,860,614 Accrued administrative services 327,361
— Other accrued expenses and payables 1,649,050
1,914,912 Total Liabilities 317,527,791
360,747,122
Net Assets Common
stock, par value $.001 per share, 200,000,000 common shares
authorized, 77,484,048 and 77,228,207 issued and 72,932,083 and
72,676,242 outstanding 77,483 77,228 Paid-in capital in excess of
par 883,420,730 877,300,709 Undistributed / (Distributions in
excess of) net investment income (5,764,145 ) (7,965,655 )
Accumulated net realized loss (196,135,641 ) (144,527,577 ) Net
unrealized (depreciation) (37,782,388 ) (92,261,515 ) Treasury
stock at cost, 4,551,965 and 4,551,965 shares held
(36,302,821 ) (36,302,821 ) Total Net Assets
607,513,218 596,320,369 Total
Liabilities and Net Assets $ 925,041,009 $
957,067,491 Net Asset Value Per Share $ 8.33
$ 8.21
BlackRock Capital Investment
Corporation
Consolidated Statements of Operations
(Unaudited)
Three months Three months Six months Six
months ended ended ended ended
June 30, 2017 June 30, 2016
June 30, 2017 June 30, 2016 Investment
Income: Interest income: Non-controlled, non-affiliated
investments $ 13,762,656 $ 21,740,253 $ 26,524,373 $ 43,479,695
Non-controlled, affiliated investments 3,441,137 1,246,674
7,102,818 2,631,941
Controlled investments
4,955,503
4,773,467
10,791,971
9,129,088
Total interest income 22,159,296
27,760,394 44,419,162
55,240,724 Fee income: Non-controlled, non-affiliated
investments: prepayment fees 16,609 3,000,000 205,609 3,000,000
Non-controlled, non-affiliated investments: other 25,171 1,078,011
135,068 1,864,294 Non-controlled, affiliated investments 63,621 —
349,916 — Controlled investments —
44,422 25,000 69,422
Total fee income 105,401
4,122,433 715,593
4,933,716 Dividend income: Non-controlled, non-affiliated
investments — 196,119 470,724 398,202 Non-controlled, affiliated
investments 277,119 541,186 466,145 1,082,374 Controlled
investments 2,111,151 808,656
3,508,502 1,610,941 Total
dividend income 2,388,270 1,545,961
4,445,371 3,091,517
Other Income 590,429 —
590,429 — Total
investment income 25,243,396 33,428,788
50,170,555 63,265,957
Expenses: Base management fees 4,139,347 5,721,689
8,663,204 11,412,179 Interest and credit facility fees 5,261,085
4,154,021 9,248,165 8,810,020 Incentive management fees (See Note
3) 2,773,859 — 3,583,042 — Professional fees 792,283 559,375
1,357,393 1,104,000 Administrative services 303,782 285,940 631,459
755,940 Director fees 145,249 188,000 317,749 361,500 Investment
advisor expenses 87,501 87,500 175,001 175,000 Other 644,853
825,319 1,342,988
1,562,125 Total expenses, before incentive
management fee waiver 14,147,959 11,821,844 25,319,001 24,180,764
Incentive management fee waiver (See Note 3) (2,773,859 )
— (3,583,042 ) —
Total expenses, net of incentive management fee waiver
11,374,100 11,821,844
21,735,959 24,180,764
Net
Investment Income 13,869,296
21,606,944 28,434,596
39,085,193
Realized and Unrealized Gain (Loss): Net
realized gain (loss): Non-controlled, non-affiliated investments
8,362 (30,974,445 ) (53,983,599 ) (30,939,561 ) Non-controlled,
affiliated investments — — — — Controlled investments —
— 2,375,535
— Net realized gain (loss) 8,362
(30,974,445 ) (51,608,064 )
(30,939,561 ) Net change in unrealized appreciation (depreciation)
on: Non-controlled, non-affiliated investments (2,697,247 )
4,972,791 54,003,848 (52,016,971 ) Non-controlled, affiliated
investments 6,225,975 (3,028,106 ) 3,537,381 3,210,820 Controlled
investments (576,287 ) (2,123,389 ) (3,280,674 ) (7,503,552 )
Foreign currency translation 145,276
(7,882 ) 218,571 435,215
Net change in unrealized appreciation (depreciation)
3,097,717 (186,586 ) 54,479,126
(55,874,488 ) Net realized and unrealized gain
(loss) 3,106,079 (31,161,031 )
2,871,062 (86,814,049 )
Net Increase
(Decrease) in Net Assets Resulting from Operations $ 16,975,375
$ (9,554,087 ) $ 31,305,658 $
(47,728,856 )
Net Investment Income Per Share Basic $ 0.19
$ 0.30 $ 0.39 $ 0.54
Diluted $ 0.19 $ 0.28 $ 0.38
$ 0.52
Earnings (Loss) Per Share Basic
$ 0.23 $ (0.13 ) $ 0.43 $ (0.65
) Diluted $ 0.22 $ (0.13 ) $ 0.42
$ (0.65 )
Average Shares Outstanding Basic
72,929,346 72,700,685
72,867,332 72,903,681 Diluted
86,187,472 72,700,685
84,454,044 72,903,681
Distributions
Declared Per Share $ 0.18 $ 0.21
$ 0.36 $ 0.42
Supplemental Information
The Company reports its financial results on a GAAP basis;
however, management believes that evaluating the Company’s ongoing
operating results may be enhanced if investors have additional
non-GAAP basis financial measures. Management reviews non-GAAP
financial measures to assess ongoing operations and, for the
reasons described below, considers them to be effective indicators,
for both management and investors, of the Company’s financial
performance over time. The Company’s management does not advocate
that investors consider such non-GAAP financial measures in
isolation from, or as a substitute for, financial information
prepared in accordance with GAAP.
Until March 6, 2017, the Company records its liability for
incentive management fees based on income as it becomes legally
obligated to pay them, based on a hypothetical liquidation at the
end of each reporting period. The Company’s obligation to pay
incentive management fees with respect to any fiscal quarter until
March 6, 2017 is based on a formula that reflects the Company’s
results over a trailing four-fiscal quarter period ending with the
pro-rated period until March 6, 2017. The Company is legally
obligated to pay the amount resulting from the formula less any
cash payments of incentive management fees during the prior three
quarters. The formula’s requirement to reduce the incentive
management fee by amounts paid with respect to such fees in the
prior three quarters has caused the Company’s incentive management
fee expense to become concentrated in the fourth quarter of each
year. Management believes that reflecting incentive management fees
throughout the year, as the related investment income is earned, is
an effective measure of the Company’s profitability and financial
performance that facilitates comparison of current results with
historical results and with those of the Company’s peers. The
Company’s “as adjusted” results reflect incentive management fees
based on the formula the Company utilizes for each trailing
four-fiscal quarter period until March 6, 2017, with the formula
applied to each quarter’s incremental earnings and without any
reduction for incentive management fees paid during the prior three
quarters. The resulting amount represents an upper limit of each
quarter’s incremental incentive management fees that the Company
may become legally obligated to pay at the end of the year. Prior
year amounts are estimated in the same manner. These estimates
represent upper limits because, in any calendar year, subsequent
quarters’ investment underperformance could reduce the incentive
management fees payable by the Company with respect to prior
quarters’ operating results. After March 6, 2017, incentive
management fees based on income are calculated for each calendar
quarter and will be paid on a quarterly basis if certain thresholds
are met. The Company records its liability for incentive management
fees based on capital gains by performing a hypothetical
liquidation at the end of each reporting period. The accrual of
this hypothetical capital gains incentive management fee is
required by GAAP, but it should be noted that a fee so calculated
and accrued is not due and payable until the end of the measurement
period, or every June 30. The incremental incentive management fees
disclosed for a given period are not necessarily indicative of
actual full year results. Changes in the economic environment,
financial markets and other parameters used in determining such
estimates could cause actual results to differ and such differences
could be material. For a more detailed description of the Company’s
incentive management fee, please refer to the Company's Annual
Report on Form 10-K for the fiscal year ended December 31, 2016, on
file with the Securities and Exchange Commission ("SEC").
Computations for the periods below are derived from the
Company's financial statements as follows:
Three monthsendedJune 30,
2017
Three monthsendedJune 30,
2016
Six monthsendedJune 30,
2017
Six monthsendedJune 30,
2016
GAAP Basis: Net Investment Income $ 13,869,296 $ 21,606,944
$ 28,434,596 $ 39,085,193 Net Investment Income per share 0.19 0.30
0.39 0.54 Addback: GAAP incentive management fee expense based on
Gains — — — — Addback: GAAP incentive management fee expense based
on Income — — — —
Pre-Incentive Fee1: Net
Investment Income $ 13,869,296 $ 21,606,944 $ 28,434,596 $
39,085,193 Net Investment Income per share 0.19 0.30 0.39 0.54
Less: Incremental incentive management fee expense based on Income
— — — —
As Adjusted2: Net Investment Income $
13,869,296 $ 21,606,944 $ 28,434,596 $ 39,085,193 Net Investment
Income per share 0.19 0.30
0.39 0.54
Note: The Net Investment Income amounts for the three and six
months ended June 30, 2017 are net of incentive management fees
based on income and a corresponding incentive management fee waiver
in the amounts of $2,773,859 and $3,583,042, respectively.
1
Pre-Incentive Fee: Amounts are
adjusted to remove all incentive management fees. Such fees are
calculated but not necessarily due and payable at this time.
2
As Adjusted: Amounts are adjusted
to remove the incentive management fee expense based on gains, as
required by GAAP, and to include only the incremental incentive
management fee expense based on Income. Until March 6, 2017, the
incremental incentive management fee is calculated based on the
current quarter's incremental earnings, and without any reduction
for incentive management fees paid during the prior calendar
quarters. After March 6, 2017, incentive management fee expense
based on income is calculated for each calendar quarter and may be
paid on a quarterly basis if certain thresholds are met. Amounts
reflect the Company's ongoing operating results and reflect the
Company's financial performance over time.
Forward-looking statements
This press release, and other statements that BlackRock Capital
Investment Corporation may make, may contain forward-looking
statements within the meaning of the Private Securities Litigation
Reform Act, with respect to BlackRock Capital Investment
Corporation’s future financial or business performance, strategies
or expectations. Forward-looking statements are typically
identified by words or phrases such as “trend,” “potential,”
“opportunity,” “pipeline,” “believe,” “comfortable,” “expect,”
“anticipate,” “current,” “intention,” “estimate,” “position,”
“assume,” “outlook,” “continue,” “remain,” “maintain,” “sustain,”
“seek,” “achieve,” and similar expressions, or future or
conditional verbs such as “will,” “would,” “should,” “could,” “may”
or similar expressions.
BlackRock Capital Investment Corporation cautions that
forward-looking statements are subject to numerous assumptions,
risks and uncertainties, which may change over time.
Forward-looking statements speak only as of the date they are made,
and BlackRock Capital Investment Corporation assumes no duty to and
does not undertake to update forward-looking statements. Actual
results could differ materially from those anticipated in
forward-looking statements and future results could differ
materially from historical performance.
In addition to factors previously disclosed in BlackRock Capital
Investment Corporation’s SEC reports and those identified elsewhere
in this press release, the following factors, among others, could
cause actual results to differ materially from forward-looking
statements or historical performance: (1) our future operating
results; (2) our business prospects and the prospects of our
portfolio companies; (3) the impact of investments that we expect
to make; (4) our contractual arrangements and relationships with
third parties; (5) the dependence of our future success on the
general economy and its impact on the industries in which we
invest; (6) the financial condition of and ability of our current
and prospective portfolio companies to achieve their objectives;
(7) our expected financings and investments; (8) the adequacy of
our cash resources and working capital, including our ability to
obtain continued financing on favorable terms; (9) the timing of
cash flows, if any, from the operations of our portfolio companies;
(10) the impact of increased competition; (11) the ability of our
investment advisor to locate suitable investments for us and to
monitor and administer our investments; (12) potential conflicts of
interest in the allocation of opportunities between us and other
investment funds managed by our investment advisor or its
affiliates; (13) the ability of our investment advisor to attract
and retain highly talented professionals; (14) changes in law and
policy accompanying the new administration and uncertainty pending
any such changes; (15) increased geopolitical unrest, terrorist
attacks or acts of war, which may adversely affect the general
economy, domestic and local financial and capital markets, or the
specific industries of our portfolio companies; (16) changes and
volatility in political, economic or industry conditions, the
interest rate environment, foreign exchange rates or financial and
capital markets; (17) the unfavorable resolution of legal
proceedings; and (18) the impact of changes to tax legislation and,
generally, our tax position.
BlackRock Capital Investment Corporation’s Annual Report on Form
10-K for the year ended December 31, 2016, filed with the SEC
identifies additional factors that can affect forward-looking
statements.
Available Information
BlackRock Capital Investment Corporation’s filings with the SEC,
press releases, earnings releases and other financial information
are available on its website at www.blackrockbkcc.com. The
information contained on our website is not a part of this press
release.
View source
version on businesswire.com: http://www.businesswire.com/news/home/20170802006164/en/
BlackRock Capital Investment
CorporationInvestor:Nik Singhal,
212.810.5427orPress:Brian Beades, 212.810.5596
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