Oxford Lane Capital Corp. Announces Net Asset Value and Selected Financial Results for the Third Fiscal Quarter and Declarati...
February 04 2020 - 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 December 31, 2019 stood
at $6.81, compared with a NAV per share on September 30, 2019 of
$6.63.
- Net investment income (“NII”), calculated in accordance with
generally accepted accounting principles (“GAAP”), was
approximately $20.0 million, or $0.32 per share, for the quarter
ended December 31, 2019.
- Our core net investment income (“Core NII”) was approximately
$39.1 million, or $0.62 per share, for the quarter ended December
31, 2019.
- Core NII represents NII adjusted for additional applicable cash
distributions received, or entitled to be received (if any, in
either case), on our collateralized loan obligation (“CLO”) equity
investments. See additional information under “Supplemental
Information Regarding Core Net Investment Income”
below.
- We emphasize that our taxable income may materially differ from
our GAAP NII and/or our Core NII, and that neither GAAP NII nor
Core NII should be relied upon as indicators of our taxable
income.
- Total investment income for the third fiscal quarter amounted
to approximately $32.4 million, which represented an increase of
$4.0 million from the quarter ended September 30, 2019.
- For the quarter ended December 31, 2019 we recorded investment
income from our portfolio as follows:
- $30.8 million from our CLO equity investments, and
- $1.6 million from our CLO debt investments and other
income.
- As of December 31, 2019 the following metrics applied (note
that none of these metrics represented a total return to
shareholders):
- The weighted average yield of our CLO debt investments at
current cost was 12.4%, compared with 10.4% as of September 30,
2019.
- The weighted average effective yield of our CLO equity
investments at current cost was 16.4%, compared with 16.4% as of
September 30, 2019.
- The weighted average cash distribution yield of our CLO equity
investments at current cost was 25.2%, compared with 22.1% as of
September 30, 2019.
- For the quarter ended December 31, 2019 we recorded a net
increase in net assets resulting from operations of approximately
$18.8 million, or $0.30 per share, comprised of:
- Net investment income of $20.0 million;
- Net realized loss of $1.6 million; and
- Net unrealized appreciation of $0.4 million.
- During the quarter ended December 31, 2019 we made additional
CLO investments of approximately $106.4 million, and received $16.2
million from sales and repayments of our CLO
investments.
- For the quarter ended December 31, 2019, we issued a total of
9,116,419 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
$78.9 million. As of January 31, 2020, we had approximately
69.0 million shares of common stock outstanding.
- On December 26, 2019, the Fund amended its Repurchase
Transaction Facility (“Repo”) with Nomura Securities International,
Inc., to extend the maturity date of the Repo from April 2, 2020 to
October 2, 2020, and increase the maximum facility size of the
Repo from $35.0 million to $50.0 million.
- On January 31, 2020 our Board of Directors declared the
following distributions on our common stock:
Month Ending |
Record Date |
Payment Date |
Amount Per Share |
April 30, 2020 |
April 15, 2020 |
April 30, 2020 |
$0.135 |
May 31, 2020 |
May 14, 2020 |
May 29, 2020 |
$0.135 |
June 30, 2020 |
June 15, 2020 |
June 30, 2020 |
$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 |
Record Dates |
Payment Dates |
Series 2023 |
$ |
0.156250 |
March 17, April 15, May 14 |
March 31, April 30, May 29 |
Series 2024 |
$ |
0.140625 |
March 17, April 15, May 14 |
March 31, April 30, May 29 |
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
applicable cash distributions received, or entitled to be received
(if any, in either case), on our CLO equity investments. OXLC’s
management uses this information in its internal analysis of
results and believes that this information may be informative in
gauging the quality of OXLC’s financial performance, identifying
trends in its results and providing meaningful period-to-period
comparisons.
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, including those CLO equity investments that have not made
their inaugural distribution for the relevant period end. 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 to 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 this non-GAAP measure may not
serve as a useful indicator 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 December 31, 2019:
|
Three Months Ended |
December 31, 2019 |
|
Amount |
|
Per Share |
Amount |
GAAP Net investment income………………………………………… |
$ |
19,976,648 |
|
$ |
0.32 |
CLO equity adjustments……………………………………….……… |
|
19,086,164 |
|
|
0.30 |
Core Net investment income…………………………………………… |
$ |
39,062,812 |
|
$ |
0.62 |
We will host a conference call to discuss our third fiscal
quarter results today, Tuesday, February 04, 2020 at 9:00 AM ET.
Please call 1-844-792-3730 to participate. A recording of the
conference call will be available for replay for approximately 30
days following the call. The replay number is 1-877-344-7529, and
the replay passcode is 10138939.
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 collateralized
loan obligation (“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 StatementsThis 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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