Closed $24.5 Million in New Loan
Originations
Declares Monthly Distributions of $0.067 Per
Share for a Total of $0.201 Per Share for First Fiscal Quarter
2015, Equal to Annualized Distribution Rate of $0.80 Per
Share
Full Circle Capital Corporation (Nasdaq: FULL) (the “Company”)
today announced its financial results for the third quarter of
fiscal 2014 ended March 31, 2014.
Financial Highlights for the Third Quarter
of Fiscal 2014
- Total investment income was $3.2
million, an increase of 14.3% compared to $2.8 million for the
three months ended March 31, 2013.
- Net investment income was $1.4 million,
or $0.15 per share, compared to $1.3 million, or $0.18 per share,
for the three months ended March 31, 2013.
- Net realized and unrealized gains were
$2.0 million, or $0.21 per share. Unrealized gains on investments
were $1.8 million, or $0.18 per share. Realized gains were $0.2
million, or $0.02 per share.
- The above resulted in a net increase in
net assets from operations of $3.4 million, or $0.36 per
share.
- Net asset value was $7.20 per share at
March 31, 2014.
- Per share amounts are based on
approximately 9.4 million weighted average shares outstanding
compared to 7.6 million weighted average shares outstanding for the
third quarter of 2013, reflecting the common equity offerings
completed in January and February, 2014.
- Total portfolio investments at March
31, 2014 were $90.1 million compared to $88.1 million at March 31,
2013 and $75.9 million at December 31, 2013.
- Weighted average portfolio interest
rate was 11.41% at March 31, 2014.
- New originations and expansion of
facilities to existing borrowers totaled $25.9 million, including
five new portfolio companies, during the three months ended March
31, 2014. Repayments and realizations totaled $9.3 million.
- At March 31, 2014, 86% of portfolio
company investments were first lien senior secured loans.
On May 2, 2014, the Board of Directors declared monthly
distributions for the first quarter of fiscal 2015 as follows:
Record Date Payment Date Per Share Amount July
31, 2014 August 15, 2014 $0.067 August 29,
2014 September 15, 2014 $0.067 September 30, 2014
October 15, 2014 $0.067
These distributions equate to a $0.804 annualized distribution
rate, or a current annualized yield of 10.65%, based on the closing
price of the Company’s common stock of $7.55 per share on May 7,
2014.
Management Commentary
“Increased origination activity since the beginning of 2014 has
resulted in the closing of six new opportunities to date, totaling
$29.0 million. This effectively replaced the $29.0 million of
realizations we received in the second and third quarters,
resulting in an investment portfolio of $90.1 million at the end of
the third quarter. With $45 million in funding capacity at March
31st, we believe we are well positioned to execute on our expanded
opportunity set,” said John Stuart, Chairman and Co-Chief Executive
Officer of Full Circle Capital Corporation.
Gregg Felton, President and Co-Chief Executive Officer
commented, “The broadening of our investment strategies
contributed to an accelerated level of investment activity in the
third quarter. We intend to further broaden our origination
channels and to continue to expand our investment team to execute
on our growing pipeline of investment opportunities.”
Third Quarter Fiscal 2014
Results
The Company’s net asset value at March 31, 2014 was $7.20 per
share. During the quarter, the Company generated $2.5 million of
interest income. Income from fees, dividends and other sources
totaled $0.7 million. The Company recorded net investment income of
$1.4 million, or $0.15 per share. Net realized and unrealized gains
were $2.0 million, or $0.21 per share. Unrealized gains on
investments were $1.8 million, or $0.18 per share and realized
gains were $0.2 million, or $0.02 per share. Net increase in net
assets from operations was $3.4 million, or $0.36 per share. Per
share amounts for the quarter ended March 31, 2014 are based on
approximately 9.4 million weighted average shares outstanding
compared to 7.6 million weighted average shares outstanding for the
quarter ended March 31, 2013. This increase reflects the common
equity offerings that Full Circle Capital completed in January and
February, 2014.
During the quarter, the Company originated $24.5 million in five
new loan facilities. Repayments and realizations from portfolio
companies totaled $9.3 million during the three month period.
At March 31, 2014, the Company’s portfolio included debt
investments in 21 companies. The average portfolio company debt
investment at March 31, 2014 was $3.7 million. The weighted average
interest rate on debt investments was 11.41%. At fair value, 86% of
portfolio investments were first lien loans, 0% were second lien
loans and 14% were equity investments. Approximately 82% of the
debt investment portfolio, at fair value, bore interest at floating
rates. The loan-to-value ratio on the Company’s loans was 64% at
March 31, 2014 compared to 54% at March 31, 2013.
Subsequent Events
On April 7, 2014, the Board of Directors authorized a share
repurchase program which provides for the purchase of up to 1
million shares of outstanding common stock, to be implemented at
the discretion of management. Under the repurchase program, Full
Circle may, but is not obligated to, repurchase our outstanding
common stock in the open market from time to time. The timing and
number of shares to be repurchased in the open market will depend
on a number of factors, including market conditions and alternative
investment opportunities.
On April 30, 2014, the Company closed on approximately $4.5
million of a $150.0 million senior secured second lien term loan to
RCS Capital Corporation, a financial services company. The secured
second lien term loan is guaranteed by all existing and subsequent
direct and indirect domestic subsidiaries of RCS Capital
Corporation, and bears interest at LIBOR plus 9.50% with a minimum
LIBOR of 1.00% per annum and has a final maturity of April 29,
2021.
Conference Call Details
Management will host a conference call to discuss these results
on Friday, May 9, 2014 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 #
42776941.
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 May 9, 2014 until 11:59 p.m. ET on May 12, 2014 by
calling 855-859-2056 (domestic) or 404-537-3406 (international) and
entering confirmation # 42776941. 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
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,” “should,” “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
March 31, 2014 June 30, 2013
Unaudited Audited
Assets Control Investments at Fair
Value (Cost of $19,842,061 and $18,139,543, respectively)
$ 20,201,058 $ 19,115,440 Affiliate Investments at Fair Value (Cost
of $19,427,127 and $17,954,622, respectively)
19,335,138 16,547,903
Non-Control/Non-Affiliate Investments at
Fair Value (Cost of $65,692,689 and $53,220,538, respectively)
60,587,005 52,511,158 Total Investments at Fair Value
(Cost of $104,961,877 and $89,314,703, respectively) 100,123,201
88,174,501 Cash 6,861,986 18,029,115 Deposit with Broker
1,050,000 - Interest Receivable
973,594 1,097,970 Principal Receivable 420,720 104,768 Dividends
Receivable 80,293 36,705 Due from Affiliate 1,332 - Due from
Portfolio Investment 137,337 105,030 Receivable from Notes Offering
- 2,299,704 Prepaid Expenses 107,459 61,198 Other Assets 700,710
1,437,273 Deferred Offering Expenses - 86,834 Deferred Debt
Issuance Costs
987,344 1,086,895 Deferred Credit Facility Fees
507,550 543,846
Total Assets
111,951,526 113,063,839
Liabilities Due to
Affiliates
736,897 728,371 Accounts Payable 186,565 471,297 Accrued
Liabilities 28,967 10,172 Due to Broker 10,000,073 - Payable for
Investments Acquired 5,940,000 - Dividends Payable 676,143 582,842
Interest Payable 31,015 134,167 Other Liabilities 494,316 358,696
Accrued Offering Expenses 11,000 - Line of Credit
- 25,584,147 Notes Payable 8.25% due June 30, 2020
21,145,525 21,145,525 Distribution Notes
- 3,404,583
Total Liabilities
39,250,501 52,419,800
Net Assets $ 72,701,025
$ 60,644,039
Components of Net Assets Common Stock,
par value $0.01 per share (100,000,000 authorized; 10,091,682 and
7,569,382 issued and outstanding, respectively) $ 100,917 $ 75,694
Paid-in Capital in Excess of Par 83,887,972 66,319,579
Distributions in Excess of Net Investment Income (1,091,069)
(200,200) Accumulated Net Realized Losses (5,358,119) (4,410,832)
Accumulated Net Unrealized Losses (4,838,676)
(1,140,202)
Net Assets $ 72,701,025 $ 60,644,039
Net Asset Value Per Share $ 7.20 $ 8.01
FULL CIRCLE CAPITAL CORPORATION AND
SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
Three Months
EndedMarch 31, Nine Months EndedMarch 31,
2014 2013 2014
2013 Investment Income Interest Income from
Non-Control/Non-Affiliate Investments $ 1,308,432 $ 1,615,618 $
4,839,103 $ 5,609,673 Interest Income from Affiliate Investments
673,896 389,518 1,984,549 950,026 Interest Income from Control
Investments 510,038 435,300 1,452,149 1,033,884 Dividend Income
from Control Investments 80,293 80,178 114,704 186,768 Other Income
from Non-Control/Non-Affiliate Investments
603,190 305,935 1,966,552 834,515 Other Income from Affiliate
Investments
3,275 3,992 12,156 63,577 Other Income from Control Investments
12,500 12,500 37,500 37,500 Total
Investment Income 3,191,624 2,843,041
10,406,713 8,715,943
Operating Expenses
Management Fee
364,352 362,743 1,156,099 1,041,905 Incentive Fee
351,594 328,044 1,141,230 1,001,406
Total Advisory Fees 715,946 690,787 2,297,329
2,043,311 Allocation of Overhead Expenses
43,604 84,552 142,315 225,860 Sub-Administration Fees
50,000 50,000 150,000 173,429 Officers’ Compensation
75,529 75,160 226,396 225,514 Total
Costs Incurred Under Administration Agreement 169,133
209,712 518,711 624,803 Directors’ Fees 26,125
24,625 86,375 86,375 Interest Expense
623,091 379,310 2,062,570 1,214,392 Professional Services Expense
112,629 108,998 467,110 384,061 Bank Fees 9,941 3,975 45,409 12,295
Other 128,380 113,470 379,015 334,647
Total Operating Expenses 1,785,245 1,530,877 5,856,519
4,699,884 Net Investment Income 1,406,379 1,312,164
4,550,194 4,016,059 Net Change in Unrealized Gain (Loss) on
Investments 1,751,729 168,654 (3,698,474) 1,978,556 Net Realized
Gain (Loss) on: Investments 224,320 - (946,449) (4,047,108) Foreign
Currency Transactions (906) - (838) -
Net Realized Gain (Loss) 223,414 - (947,287)
(4,047,108)
Net Increase (Decrease) in Net Assets
Resulting from Operations $ 3,381,522 $ 1,480,818 $ (95,567) $
1,947,507 Earnings (Loss) per Common Share Basic and Diluted
$ 0.36 $ 0.20 $ (0.01) $ 0.28 Net Investment Income per Common
Share Basic and Diluted $ 0.15 $ 0.18 $ 0.56 $ 0.59 Weighted
Average Shares of Common Share Outstanding Basic and Diluted
9,419,350 7,569,382 8,177,036 6,835,258
FULL CIRCLE CAPITAL CORPORATION AND
SUBSIDIARIES
FINANCIAL HIGHLIGHTS
(unaudited)
Three months Three
months Nine months Nine months ended
ended ended ended March 31, 2014
March 31, 2013 March 31, 2014 March 31, 2013
Per Share Data (1) : Net asset
value at beginning of period $ 7.09 $ 8.03 $ 8.01 $ 8.59 Dilution
from offering - (3) - - (0.17) (2) Offering costs (0.03) - (0.03)
(0.01) Net investment income (loss) 0.15 0.18 0.56 0.59 Change in
unrealized gain (loss) 0.18 0.02 (0.53) 0.28 Realized gain (loss)
0.02 0.00 (0.14) (0.59) Dividends declared (0.21)
(0.23) (0.67) (0.69) Net asset value at end of
period $ 7.20 $ 8.00 $ 7.20 $ 8.00 (1) Financial
highlights are based on weighted average shares outstanding. (2)
Dilution from offering is based on the change in net asset value
from a follow on offering on November 27, 2012. (3) Dilution from
offering is based on the change in net asset value from the
follow-on offerings on January 14, 2014 and February 27, 2014.
Company Contact:Full Circle Capital CorporationJohn E.
Stuart, Co-CEO914-220-6300jstuart@fccapital.comorInvestor
Relations Contacts:LHAStephanie Prince/Jody
Burfening212-838-3777sprince@lhai.com
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