HOUSTON, July 20, 2020 /PRNewswire/ -- Main Street
Capital Corporation (NYSE: MAIN) ("Main Street") is pleased to
announce its preliminary operating results for the second quarter
of 2020. Main Street's preliminary estimate of second quarter
2020 net investment income ("NII") is $0.47 to $0.48 per
share. Main Street's preliminary estimate of second quarter
2020 distributable net investment income ("DNII"), which is NII
before non-cash, share-based compensation expense, is
$0.51 to $0.52 per share.(1)
Main Street's preliminary estimate of net asset value ("NAV")
per share as of June 30, 2020 is
$20.80 to $20.90, representing an increase of approximately
$0.07 to $0.17 per share, or 0.3% to 0.8%, from the
reported NAV per share of $20.73 as
of March 31, 2020. The
preliminary estimate of non-accrual debt investments as a
percentage of Main Street's total investment portfolio as of
June 30, 2020 is 1.9% on a fair value
basis and 6.3% on a cost basis.
As of June 30, 2020, Main Street
had total liquidity of approximately $530
million through a combination of cash, undrawn capacity
under its revolving credit facility and remaining capacity under
its Small Business Investment Company ("SBIC") debentures.
Main Street's total debt to equity leverage ratio is estimated to
be 0.83x while its net debt (total debt less cash and cash
equivalents) to equity leverage ratio is estimated to be 0.78x,
unchanged from March 31, 2020. Main
Street's regulatory based net debt (which subtracts its SBIC
debentures and cash and cash equivalents from its total debt) to
equity leverage ratio is estimated to be 0.55x, also unchanged from
March 31, 2020.(2)
ABOUT MAIN STREET CAPITAL CORPORATION
Main Street (www.mainstcapital.com) is a principal investment
firm that primarily provides long-term debt and equity capital to
lower middle market companies and debt capital to middle market
companies. Main Street's portfolio investments are typically
made to support management buyouts, recapitalizations, growth
financings, refinancings and acquisitions of companies that operate
in diverse industry sectors. Main Street seeks to partner
with entrepreneurs, business owners and management teams and
generally provides "one stop" financing alternatives within its
lower middle market portfolio. Main Street's lower middle
market companies generally have annual revenues between
$10 million and $150 million. Main Street's middle market
debt investments are made in businesses that are generally larger
in size than its lower middle market portfolio companies.
FORWARD-LOOKING STATEMENTS AND OTHER MATTERS
Main Street cautions that statements in this press release which
are forward–looking and provide other than historical information,
including but not limited to the preliminary estimates of second
quarter 2020 results, NAV, available liquidity and leverage, are
based on current conditions and information available to Main
Street as of the date hereof and include statements regarding Main
Street's goals, beliefs, strategies and future operating results
and cash flows. Although its management believes that the
expectations reflected in those forward–looking statements are
reasonable, Main Street can give no assurance that those
expectations will prove to be correct. Those forward-looking
statements are made based on various underlying assumptions and are
subject to numerous uncertainties and risks, including, without
limitation: Main Street's continued effectiveness in raising,
investing and managing capital; adverse changes in the economy
generally or in the industries in which Main Street's portfolio
companies operate; the potential impacts of the COVID-19 pandemic
on the business and operations, liquidity and access to capital of
Main Street and its portfolio companies, and on the U.S. and global
economies, including public health requirements in response to the
pandemic; changes in laws and regulations or business, political
and/or regulatory conditions that may adversely impact Main
Street's operations or the operations of its portfolio companies;
the operating and financial performance of Main Street's portfolio
companies and their access to capital; retention of key investment
personnel; competitive factors; and such other factors described
under the captions "Cautionary Statement Concerning Forward-Looking
Statements" and "Risk Factors" included in Main Street's filings
with the Securities and Exchange Commission (www.sec.gov).
Main Street undertakes no obligation to update the information
contained herein to reflect subsequently occurring events or
circumstances, except as required by applicable securities laws and
regulations.
The preliminary estimates of second quarter 2020 results, NAV,
available liquidity and leverage furnished above are based on Main
Street management's preliminary determinations and current
expectations, and such information is inherently uncertain.
The preliminary estimates are subject to completion of Main
Street's customary quarter-end closing and review procedures and
third-party review, including the determination of the fair value
of Main Street's portfolio investments by the Main Street Board of
Directors, and have not yet been approved by the Main Street Board
of Directors. As a result, actual results could differ
materially from the current preliminary estimates based on
adjustments made during Main Street's quarter-end closing and
review procedures and third party review, and Main Street's
reported information in its Quarterly Report on Form 10-Q for the
quarter ended June 30, 2020 may
differ from this information, and any such differences may be
material. In addition, the information furnished above does
not include all of the information regarding Main Street's
financial condition and results of operations for the quarter
ended June 30, 2020 that may be important to readers.
As a result, readers are cautioned not to place undue
reliance on the information furnished in this press release and
should view this information in the context of Main Street's full
second quarter 2020 results when such results are disclosed by Main
Street in its Quarterly Report on Form 10-Q for the quarter
ended June 30, 2020. The information furnished in this
press release is based on current Main Street management
expectations that involve substantial risks and uncertainties that
could cause actual results to differ materially from the results
expressed in, or implied by, such information.
Before you invest in any of Main Street's securities, you should
read the registration statement and the applicable prospectus and
prospectus supplement(s) in order to fully understand all of the
implications and risks of an offering of Main Street's securities.
You should also read other documents Main Street has filed
with the Securities and Exchange Commission for more complete
information about Main Street and its securities offerings. You may
get these documents for free by visiting the Securities and
Exchange Commission website at www.sec.gov. Alternatively, Main
Street will arrange to send you any applicable prospectus and
prospectus supplement if you request such materials by calling Main
Street at (713) 350-6000. These materials are also made available,
free of charge, on Main Street's website at www.mainstcapital.com.
Information contained on Main Street's website is not
incorporated by reference into this communication.
(1) Distributable net investment income is calculated as net
investment income as determined in accordance with U.S. Generally
Accepted Accounting Principles, or U.S. GAAP, excluding the impact
of share-based compensation expense which is non-cash in
nature. Main Street believes presenting distributable net
investment income per share is useful and appropriate supplemental
disclosure for analyzing its financial performance since
share-based compensation does not require settlement in cash.
However, distributable net investment income is a non-U.S. GAAP
measure and should not be considered as a replacement for net
investment income and other earnings measures presented in
accordance with U.S. GAAP. Instead, distributable net
investment income should be reviewed only in connection with such
U.S. GAAP measures in analyzing Main Street's financial
performance. In order to reconcile estimated distributable
net investment income per share to estimated net investment income
per share in accordance with U.S. GAAP, $0.04 per share of estimated share-based
compensation expense is added back to calculate estimated
distributable net investment income per share.
(2) The estimated net debt to equity leverage ratio is
calculated as the total debt to equity leverage ratio as determined
in accordance with U.S. GAAP, except that total debt is reduced by
cash and cash equivalents. The estimated regulatory based net
debt to equity leverage ratio is calculated in the same manner as
the net debt to equity leverage ratio, except that outstanding SBIC
debentures are excluded from the net debt pursuant to an exemptive
order Main Street received from the Securities and Exchange
Commission. Main Street believes presenting the net debt to
equity leverage ratio is useful and appropriate supplemental
disclosure for analyzing its financial position and leverage. Main
Street believes presenting the regulatory based net debt to equity
leverage ratio is useful and appropriate supplemental disclosure
because Main Street, a business development company, is permitted
to exclude such borrowings from its regulatory asset coverage ratio
calculation pursuant to an exemptive order received from the
Securities and Exchange Commission. However, the estimated net debt
to equity leverage ratio and the estimated regulatory based net
debt to equity leverage ratio are non-U.S. GAAP measures and should
not be considered as replacements for the total debt to equity
leverage ratio and other financial measures presented in accordance
with U.S. GAAP. Instead, the net debt to equity leverage
ratio and the regulatory based net debt to equity leverage ratio
should be reviewed only in connection with such U.S. GAAP measures
in analyzing Main Street's financial position. In order to
reconcile the estimated net debt to equity leverage ratio to the
estimated total debt to equity leverage ratio in accordance with
U.S. GAAP, $70 million of estimated
cash and cash equivalents are subtracted from total debt to
calculate the net debt to equity leverage ratio. In order to
reconcile the estimated regulatory based net debt to equity
leverage ratio to the estimated total debt to equity leverage
ratio, $70 million of estimated cash
and cash equivalents and $315 million
of estimated SBIC debentures outstanding are subtracted from total
debt to calculate the regulatory based net debt to equity leverage
ratio.
Contacts:
Main Street Capital Corporation
Dwayne L. Hyzak, CEO,
dhyzak@mainstcapital.com
Brent D. Smith, CFO,
bsmith@mainstcapital.com
713-350-6000
Dennard Lascar Investor
Relations
Ken Dennard /
ken@dennardlascar.com
Zach Vaughan /
zvaughan@dennardlascar.com
713-529-6600
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SOURCE Main Street Capital Corporation