Full Circle Capital Corporation (Nasdaq: FULL) (the “Company”)
today announced its financial results for the second quarter of
fiscal 2013 ended December 31, 2012.
Financial Highlights for the Second
Quarter of Fiscal 2013
- Net asset value was $8.03 per share at
December 31, 2012.
- Total investment income was $3.1
million, including income from fees, dividends and other sources of
$0.5 million.
- Net investment income was $1.5 million,
or $0.22 per share.
- Monthly distributions of $0.077 per
share were paid on November 15, 2012, December 14, 2012 and January
15, 2013, totaling $0.23 per share for the quarter.
- Net realized losses were $(3.2)
million, or $(0.49) per share, and net unrealized gains were $1.3
million, or $0.20 per share, and combined with net investment
income, resulted in a net decrease in net assets from operations of
$(0.4) million, or $(0.06) per share.
- Total portfolio investments at December
31, 2012 were $77.6 million (excluding U.S. treasury bills of $22.0
million), compared to $75.5 million (excluding U.S. treasury bills
of $25.0 million) at September 30, 2012.
- Weighted average portfolio interest
rate was 12.55% at December 31, 2012.
- New originations were $3.9 million,
consisting of a new debt facility to SOLEX Fine Foods, LLC.
Additional funding to existing borrowers totaled $1.6 million
(excluding regular borrowing under revolvers).
- At December 31, 2012, 88% of portfolio
company investments were first lien senior secured loans.
- At December 31, 2012, debt outstanding
was $20.0 million consisting of $16.6 million drawn under the
Company’s $35.0 million senior credit facility and $3.4 million of
senior unsecured notes.
- On November 27, 2012 the Company raised
$10.1 million of net equity capital through a public offering of
1.35 million common shares priced at $7.90 per share.
On February 5, 2013, the Board of Directors declared monthly
distributions for the fourth quarter of fiscal 2013 as follows:
Record Date
Payment Date Per
Share Amount April 30, 2013
May 15, 2013
$0.077 May 31, 2013 June 14, 2013 $0.077 June 28,
2013 July 15, 2013
$0.077
These distributions equate to a $0.924 annualized distribution
rate, or a current annualized yield of 11.9%, based on the closing
price of the Company’s common stock of $7.76 per share on February
8, 2013.
Management Commentary
“Net investment income per share increased 10% sequentially to
$0.22, marking the second consecutive quarter of such growth. While
growing net investment income, we have continued to increase our
investment portfolio which totaled $77.6 million at quarter end,
the largest level since our IPO in 2010,” said John Stuart,
Chairman and Chief Executive Officer of Full Circle Capital Corp.
“Our primary strategy of investing in first lien senior secured
loans to smaller and lower middle-market companies with a desirable
yield continues to produce highly competitive portfolio metrics. We
now have debt investments in 18 companies with first lien senior
secured loans comprising 88% of the total investment portfolio. The
weighted average yield on the portfolio was 12.55% for the quarter,
within our current target range. Our positions are further
supported by a loan-to-value ratio of 59%, with floating rate
flexibility in 84% of our investments.”
“With the capital raised during the quarter, we have additional
resources to continue to expand our investment portfolio.
Originations and additional funding to existing borrowers totaled
$5.5 million for the second quarter and subsequent to the end of
the quarter we added, net of payoffs, a $2.0 million investment to
our portfolio. Our flexible uni-tranche lending solutions continue
to attract quality credit opportunities allowing us to remain
highly selective in the current market environment.”
Second Quarter Fiscal 2013
Results
The Company’s net asset value at December 31, 2012 was $8.03 per
share. During the quarter, the Company generated $2.6 million of
interest income, of which 100% was paid in cash. Income from fees,
dividends and other sources totaled $0.5 million. The Company
recorded net investment income of $1.5 million, or $0.22 per share.
Net realized losses were $(3.2) million, or $(0.49) per share, and
unrealized gains were $1.3 million, or $0.20 per share, both
primarily related to the disposition of one investment. Net
decrease in net assets from operations was $(0.4) million, or
$(0.06) per share. Per share amounts for the quarter ended December
31, 2012 are based on approximately 6.7 million weighted average
shares outstanding.
During the quarter, the Company originated a $3.9 million new
loan facility, which was fully funded at closing. Additional
funding to existing borrowers, excluding regular borrowing under
revolvers, was $1.6 million during the quarter.
At December 31, 2012, the Company’s portfolio included
investments in 21 companies, of which 18 were debt investments. The
average portfolio company debt investment at December 31, 2012 was
$4.0 million. The weighted average interest rate on investments was
12.55%. At fair value, 88% of portfolio investments were first lien
loans, 4% were second lien loans and 8% were equity investments.
Approximately 84% of the debt investment portfolio, at fair value,
bore interest at floating rates. The loan-to-value ratio on the
Company’s loans was 59% at December 31, 2012 compared to 62% at
September 30, 2012.
Subsequent Events
On January 31, 2013 the Company received a full payoff of its
senior secured term loan to The Selling Source, LLC, receiving $2.4
million in principal, interest and fees. On February 1, 2013, the
Company invested $4.0 million in a new senior secured term loan to
The Selling Source, LLC, bearing interest at 12.50% and maturing
February 1, 2017.
Conference Call Details
Management will host a conference call to discuss these results
on Tuesday, February 12, 2013 at 10:00 a.m. ET. To participate in
the conference call, please call 866-305-6438 (domestic call-in) or
706-679-7161 (international call-in) and reference code #
96405426.
A live webcast of the conference call and the accompanying slide
presentation will be available at
http://ir.fccapital.com/CorporateProfile.aspx?iid=4151676. All
participants should call or access the website approximately 10
minutes before the conference begins.
A telephone replay of the conference call will be available from
1:00 p.m. ET on February 12, 2013 until 11:59 p.m. ET on February
14, 2013 by calling 855-859-2056 (domestic) or 404-537-3406
(international) and entering confirmation # 96405426. An archived
replay of the conference call and slide presentation will also be
available in the investor relations section of the company’s
website.
About Full Circle Capital Corporation
Full Circle Capital Corporation (www.fccapital.com) is a
closed-end investment company that has elected to be treated as a
business development company under the Investment Company Act of
1940. Full Circle lends to and invests in senior secured loans and,
to a lesser extent, mezzanine loans and equity securities issued by
smaller and lower middle-market companies that operate in a diverse
range of industries. Full Circle’s investment objective is to
generate both current income and capital appreciation through debt
and equity investments. For additional information visit the
company’s web site www.fccapital.com.
Forward-Looking Statements
This press release contains forward-looking statements which
relate to future events or Full Circle's future performance or
financial condition. 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. These forward-looking 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 those described from time
to time in Full Circle's filings with the Securities and Exchange
Commission. Full Circle undertakes no duty to update any
forward-looking statements made herein.
FULL CIRCLE CAPITAL
CORPORATION AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF
ASSETS AND LIABILITIES December 31, 2012 June 30, 2012
(Unaudited)
(Audited)
Assets
Control Investments at Fair Value (Cost of
$18,137,713 and
$6,639,648, respectively)
$ 18,570,697 $ 6,777,511
Affiliate Investments at Fair Value (Cost
of $11,296,481 and
$6,802,017, respectively)
9,282,442 5,112,142
Non-Control/Non-Affiliate Investments at
Fair Value (Cost of
$72,151,382 and $85,181,617,
respectively)
71,765,827 82,957,117
Total Investments at Fair Value (Cost of
$101,585,576 and
$98,623,282, respectively)
99,618,966 94,846,770 Cash 304,077 639,149 Deposit with
Broker 2,250,000 2,350,000 Interest Receivable 848,630 902,711
Principal Receivable 251,751 513,372 Dividends Receivable 72,493 -
Due from Portfolio Investment 364,535 11,140 Receivable for
Investments Sold 1,126,196 - Prepaid Expenses 107,717 43,053 Other
Assets 10,550 25,499 Deferred Offering Expenses - 67,685 Deferred
Credit Facility Fees 100,000 50,000
Total Assets 105,054,915 99,449,379
Liabilities Due to Affiliate 710,556 580,353
Accounts Payable 19,337 115,741 Accrued Liabilities 47,455 79,651
Due to Broker 22,000,733 22,500,041 Dividends Payable 582,842
478,892 Interest Payable 100,479 142,518 Other Liabilities 759,692
140,458 Accrued Offering Expenses - 19,697 Line of Credit
16,622,598 18,544,660 Distribution Notes 3,404,583
3,404,583
Total Liabilities 44,248,275
46,006,594
Net Assets $
60,806,640 $ 53,442,785
Components of Net
Assets Common Stock, par value $0.01 per share (100,000,000
authorized; 7,569,382 and 6,219,382 issued and outstanding,
respectively) $ 75,694 $ 62,194 Paid-in Capital in Excess of Par
67,420,152 57,455,232 Distributions in Excess of Net Investment
Income (500,122 ) (122,763 ) Accumulated Net Realized Losses
(4,222,474 ) (175,366 ) Accumulated Net Unrealized Losses
(1,966,610 ) (3,776,512 )
Net Assets $ 60,806,640
$ 53,442,785
Net Asset Value Per Share $ 8.03
$ 8.59
FULL CIRCLE CAPITAL CORPORATION AND
SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
Three Months Ended Six Months Ended
December 31, December 31, 2012
2011
2012
2011
Investment Income Interest Income from
Non-Control/Non-Affiliate Investments $ 1,974,071 $ 2,104,779 $
3,994,055 $ 3,930,042 Interest Income from Affiliate Investments
280,567 - 560,508 234,864 Interest Income from Control Investments
319,411 227,071 598,584 254,644 Dividend Income from Control
Investments 72,493 1,823 106,590 1,823 Other Income from
Non-Control/Non-Affiliate Investments 384,553 64,992 528,580
376,449 Other Income from Affiliate Investments 56,004 - 59,585
54,086 Other Income from Control Investments 12,500 -
25,000 105,000 Total Investment Income 3,099,599
2,398,665 5,872,902 4,956,908
Operating Expenses Management Fee 345,126 300,690 679,162
586,650 Incentive Fee 365,430 274,674 673,362
646,276 Total Advisory Fees 710,556 575,364
1,352,524 1,232,926 Allocation of Overhead
Expenses 84,552 89,207 141,308 174,892 Sub-Administration Fees
50,000 78,115 123,429 156,229 Officers’ Compensation 75,160
71,629 150,354 117,553
Total Costs Incurred Under Administration
Agreement
209,712 238,951 415,091 448,674
Directors’ Fees 33,125 26,125 61,750 54,250 Interest Expense
438,587 244,405 835,082 366,965 Professional Services Expense
109,902 93,806 275,063 314,679 Bank Fees 5,230 3,285 8,320 6,966
Other 126,837 118,089 221,177 203,258
Total Gross Operating Expenses 1,633,949 1,300,025 3,169,007
2,627,718 Management Fee Waiver and Expense Reimbursement -
- - (313,792 )
Total Net Operating
Expenses 1,633,949 1,300,025 3,169,007
2,313,926 Net Investment Income 1,465,650 1,098,640
2,703,895 2,642,982 Net Change in Unrealized Gain (Loss) on
Investments 1,292,589 (846,865 ) 1,809,902 (917,680 ) Net Realized
Gain (Loss) on Investments (3,186,441 ) 766 (4,047,108 )
126,572
Net Increase (Decrease) in Net Assets
Resulting
from Operations
$ (428,202 ) $ 252,541 $ 466,689 $ 1,851,874
Earnings (Loss) per Common Share Basic and Diluted $ (0.06 )
$ 0.04 $ 0.07 $ 0.30 Net Investment Income per Common Share Basic
and Diluted $ 0.22 $ 0.18 $ 0.42 $ 0.43
Weighted Average Shares of Common
Share
Outstanding Basic and Diluted
6,732,969 6,219,382 6,476,175 6,219,382
FULL CIRCLE CAPITAL CORPORATION AND
SUBSIDIARIES FINANCIAL HIGHLIGHTS (Unaudited)
Three months ended
Three months ended
Six months ended Six months ended December 31,
2012 December 31, 2011 December 31, 2012
December 31, 2011 Per Share Data 1 :
Net asset value at beginning of
period $ 8.51 $ 9.11 $ 8.59 $ 9.08 Dilution from offering 2 (0.17 )
- (0.17 ) - Offering costs (0.01 ) - (0.01 ) - Net investment
income 0.22 0.18 0.42 0.43 Change in unrealized gain (loss) 0.20
(0.14 ) 0.28 (0.15 ) Realized gain (loss) (0.49 ) - (0.62 ) 0.02
Dividends declared (0.23 ) (0.23 ) (0.46 )
(0.46 ) Net asset value at end of period $ 8.03 $
8.92 $ 8.03 $ 8.92
1 Financial highlights are based on weighted
average shares outstanding. 2 Dilution from offering is
based on the change in net asset value from the secondary offering
on November 27, 2012.
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