Oxford Lane Capital Corp. Announces Net Asset Value and Selected Financial Results as of and for the quarter ended September ...
November 05 2018 - 8:00AM
Oxford Lane Capital Corp. (NasdaqGS: OXLC) (NasdaqGS: OXLCO)
(NasdaqGS: OXLCM) (“Oxford Lane,” the “Company,” “we,” “us” or
“our”) announced today the following financial results and related
information:
- Net asset value (“NAV”) per share as of September 30, 2018
stood at $9.93, compared with a NAV per share on June 30, 2018 of
$9.98.
- Net investment income (“NII”), calculated in accordance with
generally accepted accounting principles (“GAAP”), was
approximately $11.7 million, or $0.35 per share, for the quarter
ended September 30, 2018.
- Our core net investment income (“Core NII”) was approximately
$15.2 million, or $0.46 per share, for the quarter ended September
30, 2018.° Core NII represents GAAP NII adjusted for
additional cash distributions received, or entitled to be received
(if any, in either case), on our collateralized loan obligation
(“CLO”) equity investments while excluding any cash distributions
believed to represent a return of capital. See additional
information under “Supplemental Information Regarding Core Net
Investment Income” below.° While, in our
experience, cash flow distributions have historically represented
useful indicators of our CLO equity investments’ annual taxable
income during certain periods, we believe that current and future
cash flow distributions may be less accurate indicators of taxable
income with respect to our CLO equity investments than they have
been in the past. Accordingly, our taxable income may
materially differ from GAAP NII and/or Core NII.
- Total investment income for the second fiscal quarter of 2018
amounted to approximately $21.9 million, which represented an
increase of $0.6 million from the first fiscal quarter of 2018.
° For the quarter ended September 30, 2018 we recorded
investment income from our portfolio as follows:
• $21.1 million from our CLO equity investments,
and • $0.8 million from our CLO debt
investments and other income.
- As of September 30, 2018 the following metrics applied (note
that none of these values represented a total return to
shareholders):° The weighted average yield of our CLO
debt investments at current cost was 11.0%, compared with 11.2% as
of June 30, 2018.° The weighted average GAAP effective
yield of our CLO equity investments at current cost was 15.6%,
compared with 16.7% as of June 30, 2018.° The weighted
average cash yield of our CLO equity investments at current cost
was 20.7%, compared with 22.4% as of June 30, 2018.
- For the quarter ended September 30, 2018 we recorded a net
increase in net assets resulting from operations of approximately
$8.6 million, or $0.26 per share. This included the following
approximations:° Net investment income of $11.7
million;° Net realized gain of $1.0 million;
and° Net unrealized depreciation of $4.1
million.
- During the quarter ended September 30, 2018 we made additional
CLO investments of approximately $157.6 million, and received $91.0
million from sales and repayments of our CLO
investments.
- During the second fiscal quarter of 2018, we issued a total of
4,925,093 shares of common stock pursuant to an “at-the-market”
offering. After deducting the sales agent’s commissions and
offering expenses, this resulted in net proceeds of approximately
$52.3 million.
- On October 11, 2018, we entered into a Third Amended and
Restated Repurchase Transaction Facility with Nomura Securities
International, Inc. to extend the repurchase transaction by three
months until July 2, 2019.
- On October 30, 2018 our Board of Directors declared the
following distributions on our common stock:
Month Ending |
Record Date |
Payment Date |
Amount Per Share |
January 31, 2019 |
January 24, 2019 |
January 31, 2019 |
$0.135 |
February 28, 2019 |
February 21, 2019 |
February 28, 2019 |
$0.135 |
March 31, 2019 |
March 22, 2019 |
March 29, 2019 |
$0.135 |
Our Board of Directors also declared the required monthly
dividends on our Series 2023 Term Preferred Shares and Series 2024
Term Preferred Shares (each, a “Share”) as follows:
Preferred Shares Type |
Per Share Dividend Amount
Declared |
2018 Record Dates |
2018 Payment Dates |
Series
2023 |
$ |
0.156250 |
|
December 24,
January 24, February 21 |
December 31,
January 31, February 28 |
Series 2024 |
$ |
0.140625 |
|
December 24, January 24, February 21 |
December 31, January 31, February 28 |
In accordance with their terms, each of the Series 2023 Term
Preferred Shares and Series 2024 Term Preferred Shares will pay a
monthly dividend at a fixed rate of 7.50% and 6.75%, respectively,
of the $25.00 per share liquidation preference, or $1.875 and
$1.6875 per share per year, respectively. This fixed annual
dividend rate is subject to adjustment under certain circumstances,
but will not, in any case, be lower than 7.50% and 6.75% per year,
respectively, for each of the Series 2023 Term Preferred Shares and
Series 2024 Term Preferred Shares.
Supplemental Information Regarding Core Net Investment
Income
We provide information relating to Core NII (a non-GAAP measure)
on a supplemental basis. This measure is not provided as a
substitute for GAAP NII, but in addition to it. Our non-GAAP
measures may differ from similar measures by other companies, even
in the event of similar terms being utilized to identify such
measures. Core NII represents GAAP NII adjusted for additional cash
distributions received, or entitled to be received (if any, in
either case), on our CLO equity investments.
Income from investments in the “equity” class securities of CLO
vehicles, for GAAP purposes, is recorded using the effective
interest method – this is based on an effective yield to the
expected redemption utilizing estimated cash flows at current cost.
The result is an effective yield for the investment in which the
difference between the actual cash received, or distributions
entitled to be received, and the effective yield calculation is
adjusted from the cost. Accordingly, investment income recognized
on CLO equity securities in the GAAP statement of operations
differs from the cash distributions actually received by the
Company during the period (referred to below as “CLO equity
adjustments”).
Furthermore, in order for the Company to continue qualifying as
a regulated investment company (“RIC”) for tax purposes, we are
required, among other things, to distribute at least 90% of our
investment company taxable income annually. Therefore, Core NII may
provide a better indication of our estimated taxable income for a
reporting period than GAAP NII; we can offer no assurance that will
be the case, however, as the ultimate tax character of our earnings
cannot be determined until after tax returns are prepared at the
close of a fiscal year. We note that these non-GAAP measures may
not serve as useful indicators of taxable earnings, particularly
during periods of market disruption and volatility, and, as such,
our taxable income may differ materially from our Core NII.
The following table provides a reconciliation of GAAP NII to
Core NII for the three months ended September 30, 2018:
|
Three Months Ended |
|
September 30, 2018 |
|
|
Amount |
|
Per Share |
|
Amount |
|
GAAP net investment
income |
$ |
11,737,771 |
|
$ |
0.352 |
|
CLO equity
adjustments |
|
3,481,202 |
|
|
0.105 |
|
Core net investment
income |
$ |
15,218,973 |
|
$ |
0.457 |
|
We will host a conference call to discuss our second quarter
results today, Monday, November 5, 2018 at 09:00 AM ET. Please call
1-844-792-3730 to participate. A recording of the conference call
will be available to replay for approximately 30 days following the
call. The replay number is 1-877-344-7529, and the replay passcode
is 10125982.
A presentation containing additional details regarding our
quarterly results of operations has been posted under the Investor
Relations section of our website at www.oxfordlanecapital.com.
About Oxford Lane Capital Corp.
Oxford Lane Capital Corp. is a publicly-traded registered
closed-end management investment company. It currently seeks to
achieve its investment objective of maximizing risk-adjusted total
return by investing in debt and equity tranches of CLO vehicles.
CLO investments may also include warehouse facilities, which are
financing structures intended to aggregate loans that may be used
to form the basis of a CLO vehicle.
Forward-Looking Statements
This press release contains forward-looking statements subject
to the inherent uncertainties in predicting future results and
conditions. Any statements that are not statements of historical
fact (including statements containing the words “believes,”
“plans,” “anticipates,” “expects,” “estimates” and similar
expressions) should also be considered to be forward-looking
statements. Certain factors could cause actual results and
conditions to differ materially from those projected in these
forward-looking statements. These factors are identified from time
to time in our filings with the Securities and Exchange Commission.
We undertake no obligation to update such statements to reflect
subsequent events, except as may be required by law.
Contact: Bruce Rubin 203-983-5280
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