Eagle Point Credit Company Inc. (NYSE:ECC) (NYSE:ECCA)
(NYSE:ECCZ) (the “Company”) today announced financial results for
the quarter and fiscal year ended December 31, 2015 and net asset
value (“NAV”) as of December 31, 2015 in addition to certain
portfolio activity through February 23, 2016.
FOURTH QUARTER 2015 AND YEAR END 2015 RESULTS
The Company’s net investment income for the quarter ended
December 31, 2015 was $0.53 per share of common stock, which
compares favorably to net investment income per share of $0.51 for
the quarter ended September 30, 2015, and $0.31 per share for the
quarter ended December 31, 2014. For the fiscal year ended December
31, 2015, the Company recorded net investment income of $1.89 per
share of common stock.
For the quarter ended December 31, 2015, the Company recorded a
net loss of $20.7 million, or $1.50 per share of common stock. The
net loss was comprised of total investment income of $12.1 million,
offset by total expenses of $4.8 million and net unrealized
depreciation, or unrealized mark-to-market loss on investments, of
$28.0 million.
For the fiscal year ended December 31, 2015, the Company
recorded a net loss of $41.0 million. The loss was comprised of
total investment income of $42.3 million and a net realized gain on
investments of $0.3 million, offset by total expenses of $16.3
million and net unrealized depreciation, or unrealized
mark-to-market loss on investments, of $67.3 million. Expenses
include, among other items, interest expense and amortization of
deferred debt issuance costs related to the Company’s 7.75% Series
A Term Preferred Stock due 2022 (the “Series A Term Preferred
Stock”) and the Company’s 7.00% Unsecured Notes due 2020.
During the quarter ended December 31, 2015, the Company received
$21.1 million of cash flow from its investment portfolio, or $1.53
per share of common stock. For the fiscal year ended December 31,
2015, the Company received $66.6 million of cash flow from its
investment portfolio, or $4.82 per share of common stock.
The NAV of the Company as of December 31, 2015 was $189.6
million, or $13.72 per share of common stock. This was a decrease
of $29.0 million or $2.10 per share from the quarter ended
September 30, 2015 and a decrease of $74.0 million or $5.36 per
share from December 31, 2014. The change in the Company’s NAV
during the 2015 fiscal year was principally attributable to
mark-to-market pricing pressure faced by the investments held
within the Company’s portfolio.
Chief Executive Officer Thomas Majewski commented, “Despite a
decrease in NAV quarter-on-quarter (which was driven by unrealized
depreciation), we are pleased with the growth in the Company’s net
investment income from $0.51 per share of common stock in the third
quarter of 2015 to $0.53 per share of common stock in the fourth
quarter of 2015.”
During the quarter ended December 31, 2015, the Company made net
new investments totaling $10.0 million. For the fiscal year ended
December 31, 2015, the Company made net new investments totaling
$114.6 million.
As of December 31, 2015, the weighted average effective yield on
the Company’s CLO equity portfolio was 16.68%, slightly up from
16.65% as of September 30, 2015 and up from 15.30% as of December
31, 2014. The weighted average effective yield of these CLO equity
investments includes a provision for credit losses.
The closing price per share of the Company’s common stock on
December 31, 2015 was $16.43, representing a 19.75% premium to NAV
as of such date.
As of December 31, 2015 on a look-through basis, and based on
the most recent CLO trustee reports received by such date, the
Company had exposure to approximately 1,078 unique corporate
obligors. The largest look-through obligor represented 1.0% of the
Company’s CLO equity and loan accumulation facility portfolio. The
top-ten largest look-through obligors represented 7.3% of the
Company’s CLO equity and loan accumulation facility portfolio.
As of December 31, 2015, the Company had debt and preferred
securities outstanding which totaled approximately 27.4% of its
total assets, which is in line with management’s expectations under
current market conditions of operating the Company with leverage
(in the form of borrowings, debt securities and/or preferred stock)
within a range of 25% to 35% of total assets. As market conditions
evolve, or should significant opportunities present themselves, the
Company may incur leverage outside of this range, subject to
applicable regulatory limits.
ADDITIONAL INFORMATION
The Company has made its 2015 Annual Report available on its
website, http://eaglepointcreditcompany.com. The 2015 Annual Report
includes the Company’s audited financial statements as of and for
the period ended December 31, 2015. The Company also published on
its website an investor presentation which contains additional
information about the Company and its portfolio as of and for the
period ended December 31, 2015. In addition, the Company makes a
monthly estimate of NAV and certain additional financial
information available to investors via its website. This
information includes an estimated range of the Company’s NAV per
share of common stock for the prior month end, generally made
available within the first fifteen days after each calendar month
end, and, during the latter part of each month, certain additional
portfolio-level information and an updated estimate of NAV, if
applicable. Going forward, in connection with the publication of
management’s estimate of the Company’s calendar quarter end NAV,
the Company intends to publish management’s estimate of the
Company’s net investment income for that quarter.
FIRST QUARTER 2016 PORTFOLIO ACTIVITY THROUGH FEBRUARY 23,
2016 AND OTHER UPDATES
Since December 31, 2015 and through February 23, 2016, the
Company has received cash distributions on its investment portfolio
totaling $20.3 million, or $1.47 per share of common stock. In
addition, as published on the Company’s website earlier this week,
the Company’s unaudited estimate of the NAV per share of its common
stock as of January 31, 2016 was $12.99. This estimate reflects
management’s estimate as of January 31, 2016, was published for
information purposes only, and is subject to revision.
During the first quarter of 2016 through February 23, 2016, the
Company has made net new investments totaling $25.1 million.
While the Company does not intend to provide regular guidance on
its projected performance, based on the cash flows and the
investment income recognized on the portfolio investments through
February 23, 2016 and management’s expectation of such items
through March 31, 2016 under current market conditions, the Company
expects its GAAP net investment income per share for the quarter
ending March 31, 2016 to be between $0.57 and $0.62.
DISTRIBUTIONS
On January 29, 2016, the Company paid a distribution of $0.60
per share of common stock for stockholders of record as of December
31, 2015. This is consistent with prior distributions paid by the
Company. The Company intends to pay a quarterly distribution on its
shares of common stock for the first quarter of 2016, which the
Company expects to declare within the next few weeks. The Company
expects the distribution to be in line with its prior
distributions.
The Company paid a distribution of $0.161459 per share of the
Series A Term Preferred Stock (NYSE: ECCA) on January 29, 2016, to
stockholders of record on January 15, 2016. The distribution
represented a 7.75% annualized rate, based on the Series A Term
Preferred Stock’s $25 liquidation preference per share.
Additionally, and as previously disclosed, the Company declared
distributions of $0.161459 per share on its Series A Term Preferred
Stock, payable on each of February 29, 2016 and March 31, 2016, to
stockholders of record on February 16, 2016 and March 15, 2016,
respectively.
CONFERENCE CALL
As previously disclosed, the Company will host a conference call
at 11:00 a.m. (Eastern Time) on Friday, February 26, 2016 to
discuss the Company’s financial results for the fourth quarter and
year ended December 31, 2015, and a portfolio update. All
interested parties may participate in the conference call by
dialing (877) 201-0168 (domestic) or (647) 788-4901(international),
and entering Conference ID 38781945 approximately 10 to 15 minutes
prior to the call. An archived replay of the call will be available
shortly afterwards until March 26, 2016. To hear the replay, please
dial (855) 859-2056 (domestic) or (404) 537-3406 (international).
For the replay, enter conference ID 38781945.
ABOUT EAGLE POINT CREDIT COMPANY
The Company is a non-diversified, closed-end management
investment company. The Company’s investment objectives are to
generate high current income and capital appreciation primarily
through investment in equity and junior debt tranches of
collateralized loan obligations. The Company is externally managed
and advised by Eagle Point Credit Management LLC. The
principals of Eagle Point Credit Management LLC are
Thomas P. Majewski, Daniel W. Ko and Daniel M.
Spinner. The Company makes a monthly estimate of NAV and certain
additional financial information available to investors via its
website (www.eaglepointcreditcompany.com). This information
includes an estimated range of the Company’s NAV per share of
common stock for the prior month end, generally made available
within the first fifteen days after each calendar month end, and,
during the latter part of each month, certain additional
portfolio-level information and an updated estimate of NAV, if
applicable.
FORWARD-LOOKING STATEMENTS
This press release may contain “forward-looking statements”
within the meaning of the Private Securities Litigation Reform Act
of 1995. Statements other than statements of historical facts
included in this press release may constitute forward-looking
statements and are not guarantees of future performance 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 in the
Company’s filings with the U.S. Securities and Exchange
Commission (“SEC”). The Company undertakes no duty to update any
forward-looking statement made herein. All forward-looking
statements speak only as of the date of this press release.
FURTHER INFORMATION REGARDING PROJECTED FINANCIAL
INFORMATION
The projection of net investment income for the fiscal quarter
ending March 31, 2016 reflects management’s judgment as of the date
of this press release of conditions it expects to exist and the
course of action it expects the Company to take during the three
months ending March 31, 2016. The projected amount is based on
investment income to date and assumes that the CLO investments held
by the Company comply with their distribution waterfall
requirements for the current period and that current market
conditions continue. Although the Company considers its assumptions
to be reasonable as of the date of this press release, such
assumptions are subject to a wide variety of significant business,
economic and competitive risks and uncertainties that could cause
actual results to differ materially from those contained in the
projection, including risks and uncertainties described in the
Company’s filings with the SEC, such as the risks described as
under the heading “Investment Risk Factors and Concentration of
Investments” in the notes to the Company’s consolidated financial
statements included in the Company’s Annual Report to Stockholders
for the fiscal year ended December 31, 2015. Accordingly, there can
be no assurance that the projection is indicative of the Company’s
future performance or that actual results will not differ
materially from those presented in the projection.
The projected net investment income information was not prepared
with a view toward complying with the guidelines established by the
American Institute of Certified Public Accountants with respect to
prospective financial information, but, in the Company’s view, was
prepared on a reasonable basis and reflects the best currently
available estimates and judgments of Company management. However,
this information is not fact and readers of this press release
should not rely upon this information as being necessarily
indicative of future results or to place undue reliance on the
projected financial information. Inclusion of the projected
financial information in this press release should not be regarded
as a representation by any person that the results contained in the
projected financial information will be achieved.
Neither the Company’s independent registered public accounting
firm nor any other independent accountants has compiled, examined,
or performed any procedures with respect to the projected financial
information contained herein, nor has either one of them expressed
any opinion or any other form of assurance on such information or
its achievability, and assume no responsibility for, and disclaim
any association with, the prospective financial information.
The Company does not generally plan to publish projected
financial information. Accordingly, the Company does not intend to
update or otherwise revise the projected financial information for
the fiscal quarter ending March 31, 2016 to reflect circumstances
existing since its preparation or to reflect the occurrence of
unanticipated events, even in the event that any or all of the
underlying assumptions are shown to be in error. Furthermore, the
Company does not intend to update or revise the prospective
financial information to reflect changes in general economic or
industry conditions.
Source: Eagle Point Credit Company
View source
version on businesswire.com: http://www.businesswire.com/news/home/20160226005618/en/
Investor Relations:Eagle Point Credit Company Inc.Kenneth P.
Onorio, 203-340-8500Chief Financial
Officerir@EaglePointCredit.comwww.eaglepointcreditcompany.com
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