Saratoga Investment Corp. (NYSE:SAR) (“Saratoga Investment” or “the
Company”), a business development company, today announced
financial results for its 2020 fiscal year-end and fourth quarter.
Summary Financial Information
The Company’s summarized financial information
is as follows:
|
|
For the yearended and as ofFebruary 29, 2020 |
|
For the yearended and as ofFebruary 28, 2019 |
|
For the yearended and as ofFebruary 28, 2018 |
|
|
|
($ thousands except per share) |
|
AUM |
|
485,632 |
|
402,020 |
|
342,694 |
|
NAV |
|
304,287 |
|
180,875 |
|
143,691 |
|
NAV per share |
|
27.13 |
|
23.62 |
|
22.96 |
|
Investment Income |
|
58,448 |
|
47,708 |
|
38,615 |
|
Net Investment Income per share |
1.42 |
|
2.60 |
|
2.11 |
|
Adjusted Net Investment Income per share |
2.49 |
|
2.63 |
|
2.27 |
|
Earnings per share |
|
5.98 |
|
2.63 |
|
2.93 |
|
Dividends per share (record date) |
2.21 |
|
2.06 |
|
1.90 |
|
Return on Equity – last twelve months |
23.6% |
|
10.6% |
|
13.2% |
|
Originations |
|
204,643 |
|
187,708 |
|
107,698 |
|
Repayments* |
|
167,253 |
|
135,265 |
|
66,320 |
|
|
|
|
|
|
|
|
|
*Includes $42.9 million net realized gain for the year ended
February 29, 2020 |
|
|
For the three monthsended and as ofFebruary
29, 2020 |
|
For the three monthsended and as ofNovember
30, 2019 |
|
For the three monthsended and as ofFebruary
28, 2019 |
|
|
|
($ in thousands except per
share) |
|
AUM |
|
485,632 |
|
487,031 |
|
402,020 |
|
NAV |
|
304,287 |
|
282,180 |
|
180,875 |
|
NAV per share |
|
27.13 |
|
25.30 |
|
23.62 |
|
Investment Income |
17,613 |
|
14,196 |
|
12,984 |
|
Net Investment Income per share |
0.01 |
|
0.46 |
|
0.54 |
|
Adjusted Net Investment Income per share |
0.61 |
|
0.61 |
|
0.66 |
|
Earnings per share |
2.39 |
|
1.37 |
|
1.04 |
|
Dividends per share (record date) |
0.56 |
|
0.56 |
|
0.53 |
|
Return on Equity |
– last twelve months |
23.6% |
|
17.6% |
|
10.6% |
|
|
– annualized quarter |
36.5% |
|
21.7% |
|
17.7% |
|
Originations |
|
43,971 |
|
40,766 |
|
29,340 |
|
Repayments* |
|
70,100 |
|
51,230 |
|
77,042 |
|
|
|
|
|
|
|
|
|
*Includes $30.3 million net realized gain for thequarter ended
February 29, 2020 |
|
“Coming off a record year of achievements and
operating performance, we believe Saratoga is in a strong position
heading into this calamitous health and economic environment,” said
Christian L. Oberbeck, Chairman and Chief Executive Officer of
Saratoga Investment. “We believe our performance metrics for fiscal
2020 were remarkably strong with LTM return on equity of 23.6%,
adjusted NII per share of $2.49 per share, earnings per share of
$5.98, and an additional increase in NAV per share this quarter of
$1.83, or 7.2%, resulting in a total increase for the year of
$3.51, or 14.9%, to $27.13. This NAV number includes the completion
of the Easy Ice sale we previously communicated to you, resulting
in a $31.2 million realized gain. As we look ahead to the numerous
challenges that the COVID-19 pandemic presents to the economy and
particularly small businesses, balance sheet strength, liquidity
and NAV preservation are paramount. Our current capital structure
is the strongest in Saratoga’s history, with $304 million of equity
supporting $60 million of long-term covenant-free non-SBIC debt.
Our regulatory leverage of 607% substantially exceeds our 150%
requirement. Our liquidity and dedicated credit facilities of $260
million at year-end are available to support our portfolio
companies, including $175 million of SBIC II facilities dedicated
to new opportunities. We had $18 million of committed undrawn
lending commitments as of year-end.
In light of the dramatic uncertainties in the
economy, and to ensure we retain liquidity to support our portfolio
companies and preserve NAV during these challenging times, while
remaining positioned to fund attractive new investments for small
businesses in need, Saratoga’s Board of Directors believes it
is in the best near and long-term interests of our shareholders to
maintain a conservative and cautious approach to our dividend
policy. The Board of Directors has therefore decided to defer our
dividend for the quarter ended February 29, 2020. We will continue
to reassess this on at least a quarterly basis as we gain better
visibility on the economy and business activities. An important
consideration for this decision arises from our historically
conservative management of our RIC compliance obligations, such
that we have no ordinary income spillover obligations and therefore
substantial spillover flexibility and consequent liquidity. This
provides us the ability to defer future quarterly dividends and we
may choose to do so depending on liquidity, portfolio and overall
economic assessment.”
Michael J. Grisius, President and Chief
Investment Officer, added, “This fiscal year has again demonstrated
how the long-term measured growth of our AUM in strong portfolio
companies can result in outsized equity returns, with our $8.0
million Easy Ice investment resulting in a $31.2 million gain,
following directly after our 11x return and $11.3 million realized
gain on Censis in Q3, for a total net realized gain of $42.9
million in FY20. We also continued to bring new platform
investments into the portfolio, with two investments in new
companies added this quarter, in addition to the success we
continue to have with follow-ons in existing borrowers. We
believe the quality of our asset base remained at an exceptionally
high level at year-end, with 99% of credits rated in our highest
category, putting our portfolio in a strong position heading into
the volatility and uncertainty ahead. With 71.3% of our investments
at year-end in first lien debt and generally supported by strong
enterprise values and balance sheets in industries that have
historically performed well in stressed situations, we remain
confident thus far in the durability of our portfolio in these
uncertain times. However, we do anticipate that the adverse effects
COVID-19 has on market conditions and the overall economy,
including, but not limited to, the related declines in market
multiples, increases in underlying market credit spreads and
company-specific negative impacts on operating performance, will
lead to unrealized and potentially realized depreciation being
recognized in our portfolio in the coming quarters. We have
confidence in our experienced management team, high underwriting
standards and time-tested investment strategy and believe we have
the resources to weather the economic challenges ahead, and that
once these volatile conditions subside and uncertainty is reduced,
that our team will be able to continue to steadily grow portfolio
size and maintain quality over the long-term.”
Business Update:
Saratoga Investment is focused on ensuring the
safety of its employees and the employees of its portfolio
companies, while also managing its ongoing business
activities. The Company continues to work collaboratively
with its employees and portfolio companies to navigate the
significant challenges created by the novel coronavirus
(“COVID-19”) pandemic.
Saratoga Investment believes it has taken the
necessary steps to ensure that its personnel can effectively
operate remotely. Its senior management team and staff remain
fully engaged and capable of working remotely. Thus far, the
Company has not experienced any significant operational
limitations, and has been capable of providing the necessary
support or service that its portfolio companies have required.
Saratoga Investment has been actively engaged
with its portfolio companies and continues to be pleased with the
diligent and proactive actions taken by the portfolio company
management teams and their ability to respond effectively to the
continuing challenges in the current environment. The Company
stands ready to assist them as they manage their respective
businesses. While virtually every business has had some of
level of impact in the near-term, the ultimate impact
of COVID-19 on any individual business remains unknown.
Notwithstanding these uncertainties, based on the information we
have in hand, the Company believes that its portfolio companies are
generally taking the right steps to help mitigate both the near and
long-term effect of COVID-19 on their businesses. The
Company’s lower middle market portfolio companies have also been
actively evaluating the programs and relief under the Coronavirus
Aid, Relief, and Economic Security Act, or CARES Act, stimulus
packages that may be available to assist these portfolio companies
as they navigate the impact of COVID-19 on their businesses,
employees and operations, and many have availed themselves of that
relief.
Saratoga Investment believes that its
historically conservative approaches to investing, leverage
utilization and maintaining solid levels of liquidity, put it in a
position of strength going into this uncertain and challenging
time. While no business can anticipate with clarity how long
the displacement in the market and global economy will last, the
Company believes that Saratoga Investment’s capital structure,
liquidity and management experience will enable it to effectively
navigate the grave challenges presented by COVID-19.
Subsequent Events Update:
Saratoga Investment evaluated subsequent events
from February 29, 2020 through May 6, 2020. On March 11, 2020, the
World Health Organization declared COVID-19 as a pandemic, and on
March 13, 2020 the United States declared a national emergency with
respect to COVID-19. The outbreak of COVID-19 has severely impacted
global economic activity and caused significant volatility and
negative pressure in financial markets. The global impact of the
outbreak has been rapidly evolving and many countries, including
the United States, have reacted by instituting quarantines,
mandating business and school closures and restricting travel. Such
actions are creating disruption in global supply chains and
adversely impacting a number of industries. The outbreak could have
a continued adverse impact on economic and market conditions and
trigger a period of global economic slowdown. The rapid development
and fluidity of this situation precludes any prediction as to the
ultimate adverse impact of COVID-19. Nevertheless, COVID-19
presents material uncertainty and risks with respect to the
underlying value of the Company’s portfolio companies, the
Company’s business, financial condition, results of operations and
cash flows, such as the potential negative impact to financing
arrangements, Company decisions to delay, defer and/or modify the
character of dividends in order to preserve liquidity, increased
costs of operations, changes in law and/or regulation, and
uncertainty regarding government and regulatory policy.
As of February 29, 2020, the Company valued its
portfolio investments in conformity with U.S. GAAP based on the
facts and circumstances known by the Company at that time, or
reasonably expected to be known at that time. Due to the overall
volatility that the COVID-19 pandemic has caused during the months
that followed its February 29, 2020 valuation, any valuations
conducted now or in the future in conformity with U.S. GAAP could
result in a lower fair value of its portfolio.
The potential impact to Saratoga Investment’s
results will depend to a large extent on future developments and
new information that may emerge regarding the duration and severity
of COVID-19 and the actions taken by authorities and other entities
to contain COVID-19 or treat its impact, all of which are
beyond our control. Accordingly, the Company cannot accurately
predict the extent to which its financial condition and results of
operations will be affected at this time.
Discussion of Financial Results for the Year and
Quarter ended February 29, 2020:
As of February 29, 2020, Saratoga Investment
increased its assets under management (“AUM”) to $485.6 million, an
increase of 20.8% from $402.0 million as of February 28, 2019, and
relatively unchanged from $487.0 million as of November 30, 2019.
The annual increase reflects originations of $204.6 million
investments during the year ended February 29, 2020, offset by
repayments and amortizations of $167.3 million. This past quarter,
$44.0 million in originations was offset by repayments and
amortizations of $70.1 million, with repayments including the sale
of our Easy Ice preferred equity investment that generated a $31.2
million realized gain on a $10.7 million cost basis. Saratoga
Investment’s portfolio remains strong, with 71.3% of the portfolio
in first liens, and a continued high level of investment quality in
loan investments, with 99.0% of its loans this quarter at its
highest internal rating. This quarter’s originations include two
investments in new platforms, and five follow-ons in existing
portfolio companies. Since Saratoga Investment took over the
management of the BDC, $474.4 million of repayments and sales of
investments originated by Saratoga Investment have generated a
gross unlevered IRR of 16.9%.
For the year ended February 29, 2020, total
investment income increased by $10.7 million to $58.4 million, up
22.5% from $47.7 million for the year ended February 28, 2019. For
the three months ended February 29, 2020, total investment income
of $17.6 million increased by $4.6 million, or 35.7%, from $13.0
million as compared to the three months ended February 28, 2019,
and sequentially by $3.4 million, or 24.0%, compared to $14.2
million for the three months ended November 30, 2019. This
increased investment income was generated from an investment base
that has grown by 20.8% since last year. In addition, this
quarter’s total investment income included $3.0 million of advisory
fee income and $1.4 million of prepayment premiums related to the
Easy Ice realization. These increases were offset by the weighted
average current coupon on non-CLO BDC investments decreasing to
9.8% this quarter from 10.9% last year and 10.1% last quarter. The
decrease in the current coupon is primarily due to the reductions
in LIBOR over these periods.
As compared to the year ended February 28, 2019,
the investment income increase of $10.7 million was offset by: (i)
increased debt and financing expenses, as the growth in AUM this
year was partially financed from the $20.0 million baby bond
follow-on issuance late last year; and (ii) increased base and
incentive management fees generated from the management of this
larger pool of investments. As compared to the quarters ended
February 28, 2019 and November 30, 2019, the investment income
increases of $4.6 million and $3.4 million, respectively,
benefitted from the reduction in debt and financing expenses
resulting from the full extinguishment of the $74.5 million 2023
notes during the current quarter, while increased base and
incentive management fees from the annual growth in AUM partially
offset the year-over increases.
Saratoga Investment recognized a $1.6 million
loss on extinguishment related to the repayment of the 2023 notes
in December 2019 and January 2020.
Net investment income on a weighted average per
share basis was $1.42 and $0.01 for the year and quarter ended
February 29, 2020, respectively. Net investment income includes the
second incentive management fee expense directly related to the
Censis and Easy Ice realizations, however this excludes the $42.9
million net realized gain that was generated and presented
separately. Adjusted for the incentive fee accrual related to net
capital gains and the loss on extinguishment of our 2023 notes, the
net investment income on a weighted average per share basis was
$2.49 and $0.61, respectively. This compares to adjusted net
investment income per share of $2.63 and $0.66 for the year and
quarter ended February 28, 2019, reflecting a decrease of $0.14 and
$0.05, respectively. This also compares to adjusted net investment
income of $0.61 per share for the quarter ended November 30, 2019,
where there was no change on a quarter-on-quarter basis.
During these periods, weighted average common
shares outstanding increased from 7.0 million shares for the year
ended February 28, 2019, to 9.3 million shares for the year ended
February 29, 2020. In addition, weighted average common shares
outstanding increased from 7.5 million shares for the three months
ended February 28, 2019, to 10.0 million shares and 11.2 million
shares for the three months ended November 30, 2019, and February
29, 2020, respectively. These share increases primarily reflect the
3.4 million shares issued during last year pursuant to the
At-the-Market (“ATM”) equity offering program, which was accretive
to net asset value (“NAV”) per share.
Net investment income yield as a percentage of
average net asset value (“Net Investment Income Yield”) was 5.6%
and 0.1% for the year and quarter ended February 29, 2020,
respectively. Adjusted for the incentive fee accrual related to net
capital gains and the loss on extinguishment of our 2023 notes, the
Net Investment Income Yield was 9.9% and 9.3%, respectively. In
comparison, adjusted Net Investment Income Yield was 10.6% for the
year ended February 28, 2019, and 9.7% and 11.2% for the quarters
ended November 30, 2019, and February 29, 2020, respectively.
NAV was $304.3 million as of February 29, 2020,
an increase of $22.1 million from $282.2 million as of November 30,
2019, and an increase of $123.4 million from $180.9 million as of
February 28, 2019.
- For the twelve months ended February 29, 2020, there were $13.3
million of net investment income, $42.9 million of net realized
gain from investments and $0.4 million deferred tax benefit on net
unrealized depreciation earned, partially offset by $0.8 million of
net unrealized depreciation and $20.1 million of dividends
declared. In addition, $3.1 million of stock dividend distributions
were made through the Company’s dividend reinvestment plan
(“DRIP”), and 3,427,346 shares were sold through the ATM equity
offering during the twelve months, for net proceeds of $84.7
million.
NAV per share was $27.13 as of February 29,
2020, compared to $25.30 as of November 30, 2019 and $23.62 as of
February 28, 2019.
- The increase in NAV per share includes the $1.6 million,
or $0.14 per share loss associated with the
extinguishment of our 2023 notes.
- For the twelve months ended February 29, 2020, NAV per share
increased by $3.51 per share, primarily reflecting the $35.6
million, or $3.77 per share increase in net assets (net of the
$2.21 dividend paid during the year). The $0.26 difference is
primarily due to the different share amounts used for the NAV per
share and dividend per share calculations throughout the year, with
3.5 million shares were being issued pursuant to the ATM and DRIP
programs. The Company made no repurchases of common stock in the
open market during this period.
Return on equity for the last twelve months
ended February 29, 2020, was 23.6%, compared to 10.6% for the
comparable period last year.
Earnings per share for the year and quarter
ended February 29, 2020, was $5.98 per share and $2.39 per share,
respectively, compared to earnings per share of $2.63 per share and
$1.04 per share for the year and quarter ended February 28, 2019,
respectively, and $1.37 per share for the quarter ended November
30, 2019.
Investment portfolio activity for the year ended
February 29, 2020:
- Cost of investments made during the period: $204.6 million
- Principal repayments and amortizations during the period:
$167.3 million
Investment portfolio activity for the three
months ended February 29, 2020:
- Cost of investments made during the period: $44.0 million
- Principal repayments during the period: $70.1 million
Additional Financial Information
For the fiscal year ended February 29, 2020,
Saratoga Investment reported net investment income of $13.3
million, or $1.42 on a weighted average per share basis, and a net
gain on investments of $42.5 million, or $4.56 on a weighted
average per share basis, resulting in a net increase in net assets
from operations of $55.7 million, or $5.98 on a weighted average
per share basis. The $42.5 million net gain on investments was
comprised of $42.9 million in net realized gain on investments and
$0.4 million of net deferred tax benefit on unrealized depreciation
on investments in Saratoga Investment’s blocker subsidiaries,
offset by $0.8 million in net unrealized depreciation. The net
realized gain primarily relates to the $31.2 million gain on the
Company’s Easy Ice preferred equity investment realized in this
quarter, and the $11.3 million gain on the Company’s Censis
Technologies investment realized in the third ended November 30,
2019. The $0.8 million unrealized depreciation primarily reflects a
reversal of the previously recognized $3.8 million appreciation
following the realization of the Company’s Easy Ice preferred
equity investment, offset by (i) $1.3 million unrealized
appreciation on the Company’s GreyHeller investment, and (ii) $1.7
million unrealized appreciation on the Company’s Netreo Holdings
investment. This compared to the fiscal year ended February 28,
2019, with net investment income of $18.3 million, or $2.60 on a
weighted average per share basis, and a net gain on investments of
$0.2 million, or $0.03 on a weighted average per share basis,
resulting in a net increase in net assets from operations of $18.5
million, or $2.63 on a weighted average per share basis. The $0.2
million net gain on investments consisted of $4.9 million in net
realized gains on investments offset by $2.9 million unrealized
depreciation and $1.8 million of net deferred tax expense on
unrealized gains in Saratoga’s blocker subsidiaries.
Adjusted for the incentive fee accrual related
to net capital gains and the loss on extinguishment of our 2023
notes, the net investment income was $23.2 million and $18.6
million for the years ended February 29, 2020, and February 28,
2019, respectively – this is an increase of $4.6 million
year-over-year, or 25.2%.
For the fiscal quarter ended February 29, 2020,
Saratoga Investment reported net investment income of $0.07
million, or $0.01 on a weighted average per share basis, and net
realized and unrealized gain on investments of $26.7 million, or
$2.39 on a weighted average per share basis, resulting in a net
increase in net assets from operations of $26.8 million, or $2.39
on a weighted average per share basis. The $26.7 million net gain
on investments was comprised of $30.3 million in net realized gain
on investments and $2.1 million of net deferred tax benefit on
unrealized depreciation in Saratoga Investment’s blocker
subsidiaries, offset by $5.7 million in net unrealized depreciation
on investments.
The $30.3 million net realized gain reflects the
$31.2 million gain from the realization of the Company’s Easy Ice
preferred equity investment, offset by the $0.9 million realized
loss on the Company’s legacy M/C Communications investment. The
$5.7 million net unrealized depreciation primarily reflects (i) the
$9.5 million reversal of previously recognized appreciation
following the realization of the Company’s Easy Ice investment and
(ii) $1.4m unrealized depreciation on the Company’s CLO equity and
related investments, partially offset by (i) the $1.4 million
reversal of previously recognized depreciation following the
realization of the Company’s M/C Communications investment, (ii)
seven other investments with appreciation of between $0.25 million
and $0.4 million, and (iii) numerous other investments with smaller
appreciations.
This is compared to the fiscal quarter ended
February 28, 2019, with net investment income of $4.1 million, or
$0.54 on a weighted average per share basis, and net realized and
unrealized gain on investments of $3.8 million, or $0.50 on a
weighted average per share basis, resulting in a net increase in
net assets from operations of $7.9 million, or $1.04 on a weighted
average per share basis. The $3.8 million net gain on investments
consisted of $4.7 million in net realized gain, offset by $0.4
million in net unrealized depreciation on investments, and $0.6
million in net deferred tax expense on unrealized gains in Saratoga
Investment’s blocker subsidiaries.
Adjusted for the incentive fee accrual related
to net capital gains and the loss on extinguishment of our 2023
notes, net investment income was $6.8 million and $4.9 million for
the three months ended February 29, 2020, and February 28, 2019,
respectively – an increase of $1.9 million year-over-year, or
37.8%.
Total expenses, excluding interest and debt
financing expenses, base management fees, incentive fees and income
tax benefit, increased from $5.5 million for the year ended
February 28, 2019 to $5.7 million for the year ended February 29,
2020, remaining at 1.1% of average assets over both periods. For
the quarters ended February 29, 2020 and February 28, 2019, these
expenses increased from $1.4 million to $1.5 million.
Portfolio and Investment Activity
As of February 29, 2020, the fair value of
Saratoga Investment’s portfolio was $485.6 million (excluding $39.5
million in cash and cash equivalents), principally invested in 35
portfolio companies and one collateralized loan obligation fund
(“CLO”). The overall portfolio composition consisted of 71.3% of
first lien term loans, 15.1% of second lien term loans, 0.9% of
unsecured term loans, 6.7% of subordinated notes in the CLO and
6.0% of common equity.
For the fiscal year ended February 29, 2020,
Saratoga Investment invested $204.6 million in new or existing
portfolio companies and had $167.3 million in aggregate amount of
exits and repayments, resulting in net investments of $37.0 million
for the year. For the quarter ended February 29, 2020,
Saratoga Investment invested $44.0 million in new or existing
portfolio companies, and had $70.1 million in aggregate amount of
exits and repayments, resulting in $26.1 million of net exits and
repayments for the quarter. Both these repayment numbers include
the net realized gains recognized during the periods, primarily
related to the sales of our Easy Ice and Censis investments.
As of February 29, 2020, the weighted average
current yield on Saratoga Investment’s total portfolio as of
year-end is 9.3%, which was comprised of a weighted average current
yield of 9.6% on first lien term loans, 10.7% on second lien term
loans, 9.3% on unsecured term loans, 11.4% on CLO subordinated
notes and 0.0% on equity interests.
Portfolio Update:
Due to the unique developments since Saratoga
Investment’s fiscal year-end, the Company is taking the unusual
step of providing a post quarter-end update. Subsequent to
quarter-end, Saratoga Investment has executed approximately $34.9
million of new originations in one new portfolio company and nine
existing portfolio companies, and also had one repayment of
approximately $8.5 million, for net investments originated of $26.4
million as of May 6, 2020. This included numerous drawdowns of
committed delayed draw facilities totaling $8.5 million that has
reduced the Company’s outstanding exposure to committed delayed
draw facilities to $9.1 million.
Liquidity and Capital Resources
As of February 29, 2020, Saratoga Investment had
no outstanding borrowings under its $45 million senior secured
revolving credit facility with Madison Capital Funding LLC. At
the same time, Saratoga Investment had $150.0 million SBA
debentures outstanding, $60.0 million of baby bonds (fair value of
$60.6 million) issued and an aggregate of $39.5 million in cash and
cash equivalents.
With $45.0 million available under the credit
facility, the $39.5 million of cash and cash equivalents and $175.0
million in undrawn SBA debentures from the newly approved second
SBIC license, Saratoga Investment has a total of $259.5 million of
undrawn borrowing capacity and cash and cash equivalents available
as of February 29, 2020. It should be noted that, depending on
portfolio company performance, availability under the Madison
credit facility might be reduced. In addition, certain follow-on
investments in SBIC I and the BDC will not qualify for SBIC II
funding. Saratoga Investment also has the ability to issue
additional equity or baby bonds through the existing shelf
registration statement pursuant to existing market conditions,
which are disrupted at this time.
On November 15, 2019, the
Company caused notices to be issued to the holders of its
6.75% 2023 baby bonds regarding the Company’s exercise of its
option to redeem, in part, the issued and outstanding 2023 baby
bonds. The Company redeemed $50.0 million in aggregate
principal amount of the $74.5 million in aggregate principal amount
of issued and outstanding 2023 baby bonds on December 21, 2019
(the “Redemption Date”). The baby bonds were redeemed at 100% of
their principal amount ($25 per baby bond), plus the accrued and
unpaid interest thereon from September 30, 2019, through, but
excluding, the Redemption Date.
On January 8, 2020, the Company caused
notices to be issued to the remaining holders of its 6.75% 2023
baby bonds regarding the Company’s exercise of its option to redeem
the remaining $24.45 million in aggregate principal amount of
issued and outstanding 2023 baby bonds. The Company redeemed
the remaining amount of issued and outstanding 2023 baby bonds on
February 7, 2020 (the “Second Redemption Date”). These baby bonds
were also redeemed at 100% of their principal amount ($25 per baby
bond), plus the accrued and unpaid interest thereon from December
31, 2019, through, but excluding, the Second Redemption Date.
On March 16, 2017, Saratoga Investment entered
into an equity distribution agreement with Ladenburg Thalmann &
Co. Inc., through which Saratoga Investment may offer for sale,
from time-to-time, up to $30.0 million of its common stock through
an ATM offering. Subsequent to this, BB&T Capital Markets and
B. Riley FBR, Inc were also added to the agreement. On July 11,
2019, the amount of common stock to be offered through this
offering was increased to $70.0 million, and on October 8, 2019,
the amount of common stock to be offered through this offering was
further increased to $130.0 million. As of February 29, 2020, the
Company sold 3,922,018 shares for gross proceeds of $97.1 million
at an average price of $24.77 for aggregate net proceeds of $95.9
million (net of transaction costs). For the year ended February 29,
2020, the Company sold 3,427,346 shares for gross proceeds of $85.9
million at an average price of $25.06 for aggregate net proceeds of
$84.7 million (net of transaction costs).
On April 24, 2020, we entered into a fourth amendment to the
Credit Facility with Madison Capital Funding LLC to, among other
things:
- permit certain amendments related to the Paycheck Protection
Program (“Permitted PPP Amendment”) to Loan Asset Documents;
- exclude certain debt and interest amounts allowed by the
Permitted PPP Amendments from certain calculations related to Net
Leverage Ratio, Interest Coverage Ratio and EBITDA; and
- exclude such Permitted PPP Amendments from constituting a
Material Modification.
Dividend
Saratoga Investment has raised its dividend for
the past five years. In light of the dramatic uncertainties
currently present in the economy, and to ensure we retain liquidity
to not only support our current portfolio companies during these
challenged times, but to also create new, important relationships
through the provision of critically crucial liquidity in new
situations, Saratoga Investment’s Board of Directors (the
“Board of Directors”) believes it is in the best near- and
long-term interests of our shareholders to maintain a conservative
and cautious approach to our dividend policy.
Furthermore, while many BDCs have spillover
obligations from prior years, representing taxable income from past
obligations yet to be distributed, Saratoga Investment has
historically managed its distributions conservatively so it is
current with all spillover obligations, other than those related to
our Easy Ice and Censis long-term capital gains. This therefore
means that Saratoga Investment is not obligated to pay current
dividends related to historical earnings and enabling preservation
of precious liquidity in this challenging market environment.
The Board of Directors has therefore decided to
defer our dividend for the quarter ended February 29, 2020. We will
continue to reassess this decision on at least a quarterly basis as
we gain more visibility on the economy and business activities.
In fiscal year 2020, the Company declared a
quarterly dividend of $0.56 per share for the quarter ended
November 30, 2019, $0.56 per share for the quarter ended August 31,
2019, $0.55 per share for the quarter ended May 31, 2019 and $0.54
per share for the quarter ended February 28, 2019. Total dividends
declared for the fiscal years ended February 28, 2019, and 2018,
were $2.06 per share and $1.90 per share, respectively.
Shareholders have the option to receive payment
of dividends in cash or receive shares of common stock, pursuant to
the Company’s DRIP.
Share Repurchase Plan
In fiscal year 2015, the Company announced the
approval of an open market share repurchase plan that allows it to
repurchase up to 200,000 shares of its common stock at prices below
its NAV as reported in its then most recently published financial
statements. During fiscal year 2017, the share repurchase plan was
increased to 600,000 shares of common stock, and during fiscal
years 2018, 2019 and 2020, this share repurchase plan was extended
for another year at the same level of approval, currently through
January 15, 2021. On May 4, 2020, the Board of Directors increased
the share repurchase plan to 1.3 million shares of common stock. As
of February 29, 2020, the Company purchased 218,491 shares of
common stock, at the average price of $16.87 for approximately $3.7
million pursuant to this repurchase plan.
Saratoga Investment made no purchases of common
stock in the open market during the three months ended February 29,
2020.
2020 Fiscal Fourth Quarter and Year End
Conference Call/Webcast Information
When: |
Thursday, May 7, 2020, 10:00 a.m. Eastern Time (ET) |
|
|
Call: |
Interested parties may
participate by dialing (877) 312-9208 (U.S. and Canada) or (678)
224-7872 (outside U.S. and Canada). |
|
|
|
A replay of the call will be
available from 1:00 p.m. ET on Thursday, May 7, 2020, through 1:00
p.m. ET on Thursday, May 14, 2020, by dialing (855) 859-2056 (U.S.
and Canada) or (404) 537-3406 (outside U.S. and Canada), passcode
for both replay numbers: 2166937 |
|
|
Webcast: |
Interested parties may access a
simultaneous webcast of the call and find the Q4 and FY 2020
presentation by going to the “Events & Presentations” section
of Saratoga Investment Corp.’s investor relations website,
http://ir.saratogainvestmentcorp.com/events-presentations |
|
|
About Saratoga Investment Corp.
Saratoga Investment is a specialty finance
company that provides customized financing solutions to U.S.
middle-market businesses. The Company invests primarily in senior
and unitranche leveraged loans and mezzanine debt, and, to a lesser
extent, equity to provide financing for change of ownership
transactions, strategic acquisitions, recapitalizations and growth
initiatives in partnership with business owners, management teams
and financial sponsors. Saratoga Investment’s objective is to
create attractive risk-adjusted returns by generating current
income and long-term capital appreciation from its debt and equity
investments. Saratoga Investment has elected to be regulated
as a business development company under the Investment Company Act
of 1940 and is externally-managed by Saratoga Investment Advisors,
LLC, an SEC-registered investment advisor focusing on credit-driven
strategies. Saratoga Investment owns two SBIC-licensed
subsidiaries and manages a $500 million collateralized loan
obligation (“CLO”) fund. It also owns 100% of the Class
F-R-2, G-R-2 and subordinated notes of the CLO. The Company’s
diverse funding sources, combined with a permanent capital base,
enable Saratoga Investment to provide a broad range of financing
solutions.
Forward Looking Statements
Statements included herein contain certain
“forward-looking statements” within the meaning of the Private
Securities Litigation Reform Act of 1995, which relate to future
events or our future performance or financial condition.
Forward-looking statements can be identified by the use of forward
looking words such as “outlook,” “believes,” “expects,”
“potential,” “continues,” “may,” “will,” “should,” “seeks,”
“approximately,” “predicts,” “intends,” “plans,” “estimates,”
“anticipates” or negative versions of those words, other comparable
words or other statements that do not relate to historical or
factual matters. The forward-looking statements are based on our
beliefs, assumptions and expectations of our future performance,
taking into account all information currently available to us.
These statements are not guarantees of future performance,
condition or results and involve a number of risks and
uncertainties. Actual results may differ materially from those in
the forward-looking statements as a result of a number of factors,
including but not limited to the impact of the COVID-19 pandemic
and the pandemic's impact on the U.S. and global economy, as well
as those described from time to time in our filings with the
Securities and Exchange Commission. Any forward-looking statement
speaks only as of the date on which it is made. Saratoga Investment
Corp. undertakes no duty to update any forward-looking statements
made herein or on the webcast/conference call, whether as a result
of new information, future developments or otherwise, except as
required by law.
Financials
|
Saratoga Investment Corp. |
Consolidated Statements of Assets and
Liabilities |
|
|
|
|
|
|
|
|
|
|
|
|
|
February 29, 2020 |
|
|
February 28, 2019 |
|
ASSETS |
|
|
|
|
|
Investments at fair value |
|
|
|
|
|
Non-control/Non-affiliate investments (amortized cost of
$418,006,725 and $307,136,188, respectively) |
$ |
420,442,928 |
|
|
$ |
306,511,427 |
|
Affiliate investments (amortized cost of $23,998,917 and
$18,514,716, respectively) |
18,485,854 |
|
|
11,463,081 |
|
Control investments (amortized cost of $44,293,619 and $76,265,189,
respectively) |
46,703,192 |
|
|
84,045,212 |
|
Total investments at fair
value (amortized cost of $486,299,261 and $401,916,093,
respectively) |
485,631,974 |
|
|
402,019,720 |
|
Cash and cash equivalents |
24,598,905 |
|
|
30,799,068 |
|
Cash and cash equivalents,
reserve accounts |
14,851,447 |
|
|
31,295,326 |
|
Interest receivable (net of
reserve of $1,238,049 and $647,210, respectively) |
4,810,456 |
|
|
3,746,604 |
|
Due from affiliate |
- |
|
|
1,673,747 |
|
Management fee receivable |
272,207 |
|
|
542,094 |
|
Other assets |
701,007 |
|
|
595,543 |
|
Total assets |
$ |
530,865,996 |
|
|
$ |
470,672,102 |
|
|
|
|
|
|
|
LIABILITIES |
|
|
|
|
|
Revolving credit facility |
$ |
- |
|
|
$ |
- |
|
Deferred debt financing costs,
revolving credit facility |
(512,628 |
) |
|
(605,189 |
) |
SBA debentures payable |
150,000,000 |
|
|
150,000,000 |
|
Deferred debt financing costs,
SBA debentures payable |
(2,561,495 |
) |
|
(2,396,931 |
) |
2023 Notes payable |
- |
|
|
74,450,500 |
|
Deferred debt financing costs,
2023 notes payable |
- |
|
|
(1,919,620 |
) |
2025 Notes payable |
60,000,000 |
|
|
60,000,000 |
|
Deferred debt financing costs,
2025 notes payable |
(2,046,735 |
) |
|
(2,377,551 |
) |
Base management and incentive
fees payable |
15,800,097 |
|
|
6,684,785 |
|
Deferred tax liability |
1,347,363 |
|
|
739,716 |
|
Accounts payable and accrued
expenses |
1,713,157 |
|
|
1,615,443 |
|
Interest and debt fees
payable |
2,234,042 |
|
|
3,224,671 |
|
Directors fees payable |
61,500 |
|
|
62,000 |
|
Due to manager |
543,842 |
|
|
319,091 |
|
Total liabilities |
$ |
226,579,143 |
|
|
$ |
289,796,915 |
|
|
|
|
|
|
|
|
|
|
|
|
|
NET ASSETS |
|
|
|
|
|
Common stock, par value $.001, 100,000,000 common shares |
|
|
|
|
|
authorized, 11,217,545 and 7,657,156 common shares issued
and outstanding, respectively |
$ |
11,218 |
|
|
$ |
7,657 |
|
Capital in excess of par value |
289,476,991 |
|
|
203,552,800 |
|
Total distributable earnings
(loss) |
14,798,644 |
|
|
(22,685,270 |
) |
Total net assets |
304,286,853 |
|
|
180,875,187 |
|
Total liabilities and net assets |
$ |
530,865,996 |
|
|
$ |
470,672,102 |
|
NET ASSET VALUE PER SHARE |
$ |
27.13 |
|
|
$ |
23.62 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Asset Coverage Ratio |
607.1 |
% |
|
234.5 |
% |
|
|
|
|
|
|
|
Saratoga Investment Corp. |
Consolidated Statements of Operations |
|
|
For the three months ended |
|
|
February 29, 2020 |
|
|
February 28, 2019 |
|
INVESTMENT INCOME |
|
|
|
|
|
Interest from investments |
|
|
|
|
|
Interest income: |
|
|
|
|
|
Non-control/Non-affiliate investments |
$ |
9,389,470 |
|
|
$ |
8,628,236 |
|
Affiliate investments |
356,762 |
|
|
242,551 |
|
Control investments |
1,547,725 |
|
|
1,444,864 |
|
Payment-in-kind interest income: |
|
|
|
|
|
Non-control/Non-affiliate investments |
285,313 |
|
|
158,650 |
|
Affiliate investments |
44,024 |
|
|
39,386 |
|
Control investments |
179,247 |
|
|
1,017,543 |
|
Total interest from investments |
11,802,541 |
|
|
11,531,230 |
|
Interest from cash and cash
equivalents |
219,362 |
|
|
22,619 |
|
Management fee income |
614,872 |
|
|
592,259 |
|
Incentive fee income |
- |
|
|
139,386 |
|
Structuring and advisory fee
income* |
3,411,250 |
|
|
203,512 |
|
Other income* |
1,565,014 |
|
|
495,152 |
|
Total investment income |
17,613,039 |
|
|
12,984,158 |
|
|
|
|
|
|
|
OPERATING EXPENSES |
|
|
|
|
|
Interest and debt financing
expenses |
3,054,345 |
|
|
3,922,981 |
|
Base management fees |
2,143,372 |
|
|
1,851,983 |
|
Incentive management fees |
6,862,982 |
|
|
2,087,220 |
|
Professional fees |
503,079 |
|
|
430,952 |
|
Administrator expenses |
556,250 |
|
|
500,000 |
|
Insurance |
66,807 |
|
|
63,225 |
|
Directors fees and
expenses |
60,000 |
|
|
60,000 |
|
General &
administrative |
289,959 |
|
|
316,288 |
|
Income tax benefit |
2,426,873 |
|
|
(342,598 |
) |
Excise tax expense
(credit) |
- |
|
|
270 |
|
Other expense |
- |
|
|
2,445 |
|
Total operating expenses |
15,963,667 |
|
|
8,892,766 |
|
Loss on extinguishment of
debt |
1,583,266 |
|
|
- |
|
NET INVESTMENT INCOME |
66,106 |
|
|
4,091,392 |
|
|
|
|
|
|
|
REALIZED AND UNREALIZED GAIN
(LOSS) ON INVESTMENTS |
|
|
|
|
|
Net realized gain (loss) from
investments: |
|
|
|
|
|
Non-control/Non-affiliate investments |
(957,777 |
) |
|
4,729,298 |
|
Affiliate investments |
- |
|
|
- |
|
Control investments |
31,225,165 |
|
|
- |
|
Net realized gain (loss) from
investments |
30,267,388 |
|
|
4,729,298 |
|
Net change in unrealized
appreciation (depreciation) on investments: |
|
|
|
|
|
Non-control/Non-affiliate investments |
4,624,537 |
|
|
(2,724,083 |
) |
Affiliate investments |
678,619 |
|
|
271,652 |
|
Control investments |
(10,984,921 |
) |
|
2,094,551 |
|
Net change in unrealized
appreciation (depreciation) on investments |
(5,681,765 |
) |
|
(357,880 |
) |
Net change in provision for
deferred taxes on unrealized (appreciation) depreciation on
investments |
2,141,150 |
|
|
(607,254 |
) |
Net realized and unrealized
gain on investments |
26,726,773 |
|
|
3,764,164 |
|
|
|
|
|
|
|
NET INCREASE IN NET ASSETS
RESULTING FROM OPERATIONS |
$ |
26,792,879 |
|
|
$ |
7,855,556 |
|
|
|
|
|
|
|
WEIGHTED AVERAGE - BASIC AND
DILUTED EARNINGS PER COMMON SHARE |
$ |
2.39 |
|
|
$ |
1.04 |
|
|
|
|
|
|
|
WEIGHTED AVERAGE COMMON SHARES
OUTSTANDING - BASIC AND DILUTED |
11,190,152 |
|
|
7,534,235 |
|
|
|
|
|
|
|
* Certain prior year amounts have been reclassified to conform to
current year presentation. |
|
|
|
|
|
|
|
|
|
|
|
|
|
Saratoga Investment Corp. |
|
Consolidated Statements of Operations |
|
|
|
|
For the year ended |
|
|
February 29, 2020 |
|
|
February 28, 2019 |
|
|
February 28, 2018 |
|
INVESTMENT INCOME |
|
|
|
|
|
|
|
|
Interest from investments |
|
|
|
|
|
|
|
|
Interest income: |
|
|
|
|
|
|
|
|
Non-control/Non-affiliate investments |
$ |
36,252,113 |
|
|
$ |
33,329,539 |
|
|
$ |
26,648,380 |
|
Affiliate investments |
1,230,578 |
|
|
963,289 |
|
|
886,948 |
|
Control investments |
6,175,120 |
|
|
4,785,044 |
|
|
4,768,534 |
|
Payment-in-kind interest income: |
|
|
|
|
|
|
|
|
Non-control/Non-affiliate investments |
816,041 |
|
|
780,112 |
|
|
984,305 |
|
Affiliate investments |
167,836 |
|
|
150,284 |
|
|
80,460 |
|
Control investments |
3,405,307 |
|
|
3,288,902 |
|
|
1,741,334 |
|
Total interest from investments |
48,046,995 |
|
|
43,297,170 |
|
|
35,109,961 |
|
Interest from cash and cash
equivalents |
536,053 |
|
|
64,024 |
|
|
27,495 |
|
Management fee income |
2,503,804 |
|
|
1,722,180 |
|
|
1,509,317 |
|
Incentive fee income* |
- |
|
|
633,232 |
|
|
591,368 |
|
Structuring and advisory fee
income* |
5,286,475 |
|
|
1,355,393 |
|
|
824,795 |
|
Other income |
2,074,864 |
|
|
635,964 |
|
|
552,042 |
|
Total investment income |
58,448,191 |
|
|
47,707,963 |
|
|
38,614,978 |
|
|
|
|
|
|
|
|
|
|
OPERATING EXPENSES |
|
|
|
|
|
|
|
|
Interest and debt financing
expenses |
14,682,611 |
|
|
13,125,718 |
|
|
10,938,654 |
|
Base management fees |
8,098,995 |
|
|
6,879,324 |
|
|
5,846,400 |
|
Incentive management fees |
14,163,776 |
|
|
4,891,004 |
|
|
4,333,983 |
|
Professional fees |
1,684,089 |
|
|
1,849,424 |
|
|
1,590,798 |
|
Administrator expenses |
2,131,250 |
|
|
1,895,833 |
|
|
1,645,833 |
|
Insurance |
259,981 |
|
|
253,141 |
|
|
259,571 |
|
Directors fees and
expenses |
277,500 |
|
|
290,500 |
|
|
197,500 |
|
General &
administrative |
1,326,457 |
|
|
1,224,462 |
|
|
1,058,009 |
|
Income tax expense
(benefit) |
961,995 |
|
|
(1,027,118 |
) |
|
- |
|
Excise tax credit |
- |
|
|
- |
|
|
(14,738 |
) |
Other expense |
- |
|
|
23,466 |
|
|
27,310 |
|
Total operating expenses |
43,586,654 |
|
|
29,405,754 |
|
|
25,883,320 |
|
Loss on extinguishment of
debt |
1,583,266 |
|
|
- |
|
|
- |
|
NET INVESTMENT INCOME |
13,278,271 |
|
|
18,302,209 |
|
|
12,731,658 |
|
|
|
|
|
|
|
|
|
|
REALIZED AND UNREALIZED GAIN
(LOSS) ON INVESTMENTS |
|
|
|
|
|
|
|
|
Net realized gain (loss) from
investments: |
|
|
|
|
|
|
|
|
Non-control/Non-affiliate investments |
11,651,990 |
|
|
4,874,305 |
|
|
(5,877,734 |
) |
Control investments |
31,225,165 |
|
|
- |
|
|
166 |
|
Net realized gain (loss) from
investments |
42,877,155 |
|
|
4,874,305 |
|
|
(5,877,568 |
) |
Net change in unrealized
appreciation (depreciation) on investments: |
|
|
|
|
|
|
|
|
Non-control/Non-affiliate investments |
3,060,964 |
|
|
(5,152,206 |
) |
|
6,178,457 |
|
Affiliate investments |
1,538,572 |
|
|
(853,588 |
) |
|
818,323 |
|
Control investments |
(5,370,450 |
) |
|
3,105,485 |
|
|
3,828,275 |
|
Net change in unrealized
appreciation (depreciation) on investments |
(770,914 |
) |
|
(2,900,309 |
) |
|
10,825,055 |
|
Net change in provision for
deferred taxes on unrealized (appreciation) depreciation on
investments |
354,349 |
|
|
(1,766,835 |
) |
|
- |
|
Net realized and unrealized
gain on investments |
42,460,590 |
|
|
207,161 |
|
|
4,947,487 |
|
|
|
|
|
|
|
|
|
|
NET INCREASE IN NET ASSETS
RESULTING FROM OPERATIONS |
$ |
55,738,861 |
|
|
$ |
18,509,370 |
|
|
$ |
17,679,145 |
|
|
|
|
|
|
|
|
|
|
WEIGHTED AVERAGE - BASIC AND
DILUTED EARNINGS PER COMMON SHARE |
$ |
5.98 |
|
|
$ |
2.63 |
|
|
$ |
2.93 |
|
|
|
|
|
|
|
|
|
|
WEIGHTED AVERAGE COMMON SHARES
OUTSTANDING - BASIC AND DILUTED |
9,319,192 |
|
|
7,046,686 |
|
|
6,024,040 |
|
|
|
|
|
|
|
|
|
|
* Certain prior year amounts have been reclassified to conform to
current year presentation. |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Supplemental Information Regarding Adjusted Net Investment
Income, Adjusted Net Investment Income Yield and Adjusted Net
Investment Income per share
On a supplemental basis, Saratoga Investment
provides information relating to adjusted net investment income,
adjusted net investment income yield and adjusted net investment
income per share, which are non-GAAP measures. These measures are
provided in addition to, but not as a substitute for, net
investment income, net investment income yield and net investment
income per share. Adjusted net investment income represents net
investment income excluding any capital gains incentive fee expense
or reversal attributable to realized and unrealized gains. The
management agreement with the Company’s advisor provides that a
capital gains incentive fee is determined and paid annually with
respect to cumulative realized capital gains (but not unrealized
capital gains) to the extent such realized capital gains exceed
realized and unrealized losses for such year. In addition, Saratoga
Investment accrues, but does not pay, a capital gains incentive fee
in connection with any unrealized capital appreciation, as
appropriate. All capital gains incentive fees are presented within
net investment income within the Consolidated Statements of
Operations, but the associated realized and unrealized gains and
losses that these incentive fees relate to, are excluded. As such,
Saratoga Investment believes that adjusted net investment income,
adjusted net investment income yield and adjusted net investment
income per share is a useful indicator of operations exclusive of
any capital gains incentive fee expense or reversal attributable to
gains. In addition, adjusted net investment income, adjusted net
investment income yield and adjusted net investment income per
share also excludes the loss on extinguishment of Saratoga
Investment’s 2023 Notes. This expense is directly attributable to
the repayment of the 2020 Notes, is deemed to be non-recurring in
nature and not representative of the operations of Saratoga
Investment. The presentation of this additional information is not
meant to be considered in isolation or as a substitute for
financial results prepared in accordance with GAAP. The following
table provides a reconciliation of net investment income to
adjusted net investment income, net investment income yield to
adjusted net investment income yield and net investment income per
share to adjusted net investment income per share for the years
ended February 29, 2020, February 28, 2019, and February 28, 2018,
and the quarters ended February 29, 2020 and February 28, 2019.
|
|
For the Years Ended |
|
February 29,2020 |
February 28,2019 |
February 28,2018 |
|
|
|
|
Net Investment
Income |
$13,278,271 |
$18,302,209 |
$12,731,658 |
Changes in accrued capital gains incentive fee expense/
reversal |
8,359,207 |
251,090 |
919,806 |
Loss on extinguishment of borrowings |
1,583,266 |
- |
- |
Adjusted net investment income |
23,220,744 |
18,553,299 |
13,651,464 |
|
|
|
|
Net investment income yield |
5.6% |
10.5% |
9.5% |
Changes in accrued capital gains incentive fee expense/
reversal |
3.6% |
0.1% |
0.7% |
Loss on extinguishment of borrowings |
0.7% |
- |
- |
Adjusted net investment income yield (1) |
9.9% |
10.6% |
10.2% |
|
|
|
|
Net investment income per share |
$1.42 |
$2.60 |
$2.11 |
Changes in accrued capital gains incentive fee expense/
reversal |
0.90 |
0.03 |
0.16 |
Loss on extinguishment of borrowings |
0.17 |
- |
- |
Adjusted net investment income per share (2) |
$2.49 |
$2.63 |
$2.27 |
(1) Adjusted net investment income is calculated as adjusted net
investment income divided by average net asset value.(2) Adjusted
net investment income per share is calculated as adjusted net
investment income divided by weighted average common shares
outstanding.
|
|
|
For the Quarters Ended |
|
February 29, 2020 |
February 28, 2019 |
|
|
|
Net Investment Income |
$ 66,106 |
$4,091,392 |
Changes in accrued capital gains
incentive fee expense/ reversal |
5,162,197 |
851,151 |
Loss on extinguishment of borrowings |
1,583,266 |
|
Adjusted net investment
income |
6,811,569 |
4,942,543 |
|
|
|
Net investment income yield |
0.1% |
9.2% |
Changes in accrued capital gains
incentive fee expense/ reversal |
7.0% |
2.0% |
Loss on extinguishment of borrowings |
2.2% |
- |
Adjusted net investment income
yield (1) |
9.3% |
11.2% |
|
|
|
Net investment income per
share |
$0.01 |
$0.54 |
Changes in accrued capital gains
incentive fee expense/ reversal |
0.46 |
0.12 |
Loss on extinguishment of borrowings |
0.14 |
- |
Adjusted net investment income
per share (2) |
$0.61 |
$0.66 |
(1) Adjusted net investment income yield is calculated as
adjusted net investment income divided by average net asset
value.(2) Adjusted net investment income per share is calculated as
adjusted net investment income divided by weighted average common
shares outstanding.
Contact: Henri SteenkampSaratoga Investment
Corp.212-906-7800Roland TomfordeBroadgate
Consultants212-232-2222
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