Newtek Business Services Corp. Forecasts Fourth Quarter 2022 Distribution of $0.70 per Share
September 28 2022 - 10:35AM
Newtek Business Services Corp., (NASDAQ: NEWT), an internally
managed business development company (“BDC”), announced today it is
forecasting a fourth quarter 2022 cash distribution of $0.70 per
share.1 In anticipation of the Company converting from a BDC and
discontinuing its election to be regulated under the Investment
Company Act of 1940 (“1940 Act”), subject to regulatory approvals
of its pending acquisition of National Bank of New York City
(“NBNYC”) and other conditions described in the Company’s proxy
statement filed with the SEC on May 2, 2022, after which the
Company will no longer qualify as a regulated investment company
(“RIC”) for federal income tax purposes and will no longer qualify
for accounting treatment as an investment company, the Company
anticipates distributing 90 – 100% of its 2022 taxable income, in
addition to a spillover dividend of its retained earnings, which we
expect to be paid out as a fourth quarter 2022 distribution in
December 2022.
Barry Sloane, CEO, President and Chairman commented, “We are
very pleased to provide a forecast of our fourth quarter 2022 cash
distribution to shareholders. If declared by the Board, the Company
expects to pay approximately $2.75 per share in cash dividends and
distributions to shareholders in 2022 and, as such, to have
achieved its goal of providing attractive cash-on-cash returns to
its shareholders. This cash distribution would bring the total
dividends and distributions paid in 2022 in line with the Company’s
previously forecasted guidance of $2.40 per share to $2.90 per
share. While the total 2022 distribution may include a return of
capital, the determination of the tax attributes of the Company’s
2022 distributions will not be made until the end of the Company’s
fiscal year based upon its taxable income for the full year and
distributions paid for the full year. We are excited as we
anticipate exiting the BDC space, subject to regulatory approvals
to acquire NBNYC, and become a bank holding company. We take pride
that throughout our 8 years of operating as a BDC, we have lived up
to our commitment of performing as a high-yielding growth-oriented
BDC.”
Mr. Sloane continued, “Importantly, we have made great strides
in preparing for the ownership of NBNYC and expect to forecast 2023
and 2024 earnings and performance metrics following receipt of
regulatory approvals of our acquisition of NBNYC. We believe these
forecasts will provide an opportunity for investors to evaluate
Newtek going forward.”
Mr. Sloane concluded, “Some of the important items we look
forward to as part of our conversion to a bank holding company are
the anticipated transition of the Company to being covered by bank
analysts from BDC analysts, the potential opportunity to be
considered for inclusion in the Russell 2000, an increase in our
universe of potential investors who may have been precluded from
investing in a BDC due to our status as a 1940 Act company,
Newtek’s belief that it can generate higher total returns on equity
as a bank holding company than as a BDC, and potentially unlocking
further shareholder value through technology joint ventures and the
implementation of the Newtek Advantage™ business portal for our
clients. That said, we could not be more excited about our future
despite tough capital markets. Like an iceberg with its core and
strength beneath the surface, Newtek believes that it has developed
a tremendous foundation, which may not yet be seen, but still
exists; that is the core of excitement which we believe will be
unlocked for all to see under this new structure.”
1Note regarding Dividend Payments: Amount and
timing of fourth quarter dividend or distribution, if any, remains
subject to the discretion of the Company's Board of Directors.
Newtek Business Services Corp., Your Business Solutions
Company®, is an internally managed BDC, which along with its
controlled portfolio companies, provides a wide range of business
and financial solutions under the Newtek® brand to the small- and
medium-sized business (“SMB”) market. Since 1999, Newtek has
provided state-of-the-art, cost-efficient products and services and
efficient business strategies to SMB relationships across all 50
states to help them grow their sales, control their expenses and
reduce their risk.
Newtek’s and its portfolio companies’ products and services
include: Business Lending, SBA Lending Solutions, Electronic
Payment Processing, Technology Solutions (Cloud Computing, Data
Backup, Storage and Retrieval, IT Consulting), eCommerce, Accounts
Receivable Financing & Inventory Financing, Insurance
Solutions, Web Services, and Payroll and Benefits Solutions.
Newtek® and Your Business Solutions Company® are
registered trademarks of Newtek Business Services Corp.
Note Regarding Forward Looking
Statements
This press release contains certain
forward-looking statements. Words such as “believes,” “intends,”
“expects,” “projects,” “anticipates,” “forecasts,” “goal” and
“future” or similar expressions are intended to identify
forward-looking statements. All forward-looking statements involve
a number of risks and uncertainties that could cause actual results
to differ materially from the plans, intentions and expectations
reflected in or suggested by the forward-looking statements. Such
risks and uncertainties include, among others, include our ability
to close the pending acquisition of the National Bank of New York
City (the “Transaction”), obtain required regulatory approvals for
the pending Transaction, the timing of the closing of the
Transaction, the timing of the Company’s discontinuance from
regulation as a BDC under the 1940 Act, projections concerning or
considering the pending Transaction, the timing of our ability to
originate new investments, achieve certain margins and levels of
profitability, the availability of additional capital and the
ability to maintain certain debt to asset ratios, intensified
competition, operating problems and their impact on revenues and
profit margins, anticipated future business strategies and
financial performance, anticipated future number of customers,
business prospects, legislative developments and similar matters.
Risk factors, cautionary statements and other conditions, which
could cause Newtek’s actual results to differ from management’s
current expectations, are contained in Newtek’s filings with the
Securities and Exchange Commission and available through
http://www.sec.gov/. Newtek cautions you that forward-looking
statements are not guarantees of future performance and that actual
results or developments may differ materially from those projected
or implied in these statements.
SOURCE: Newtek Business Services Corp.
Investor Relations & Public
RelationsContact: Jayne Cavuoto Telephone: (212) 273-8179
/ jcavuoto@newtekone.com
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