NEW
YORK, May 4, 2022 /PRNewswire/ -- Owl Rock
Capital Corporation (NYSE: ORCC, or the "Company") today reported
net investment income of $122.4
million, or $0.31 per share,
and net income of $44.0 million, or
$0.11 per share, for the first
quarter ended March 31, 2022.
Reported net asset value per share was $14.88 at March 31,
2022 as compared to $15.08 at
December 31, 2021.
Craig W. Packer, Chief Executive
Officer of Owl Rock Capital Corporation commented, "We are very
pleased with our performance this quarter and how our portfolio is
positioned for the evolving economic environment. Our credit
performance remains exceptional with one of the lowest levels of
non-accruals in the BDC sector and our defensive positioning is
designed to generate healthy returns through the entire market
cycle. Further, with almost all of our portfolio held in floating
rate assets, we expect to see upside in the second half of the year
from a rising interest rate environment."
The Company's Board of Directors has declared a second quarter
2022 dividend of $0.31 per share for
stockholders of record as of June 30,
2022, payable on or before August 15,
2022.
PORTFOLIO AND INVESTING
ACTIVITY
For the three months ended March 31,
2022, new investment commitments totaled $530.4 million across 17 new portfolio companies
and 4 existing portfolio companies. This compares to $1,589.2 million for the three months ended
December 31, 2021 across 22 new
portfolio companies and 9 existing portfolio companies.
For the three months ended March 31,
2022, the principal amount of new investments funded was
$347.9 million. For this period, the
Company had $374.8 million aggregate
principal amount in exits and repayments.
For the three months ended December 31,
2021, the principal amount of new investments funded was
$1,459.8 million. For this period,
the Company had $909.6 million
aggregate principal amount in exits and repayments.
As of March 31, 2022 and
December 31, 2021, the Company had
investments in 157 and 143 portfolio companies with an aggregate
fair value of $12.8 billion and
$12.7 billion, respectively. As of
March 31, 2022, the average
investment size in each portfolio company was $81.3 million based on fair value.
As of March 31, 2022, based on
fair value, our portfolio consisted of 74.0% first lien senior
secured debt investments, 14.7% second lien senior secured debt
investments, 2.1% unsecured debt investments, 2.3% investment funds
and vehicles, 1.9% preferred equity investments, and 5.0% common
equity investments.
As of December 31, 2021, based on
fair value, our portfolio consisted of 74.9% first lien senior
secured debt investments, 15.1% second lien senior secured debt
investments, 1.5% unsecured debt investments, 1.9% investment funds
and vehicles, 2.1% preferred equity investments, and 4.5% common
equity investments.
As of March 31, 2022 and
December 31, 2021, approximately
88.7% and 90.0% of the portfolio was invested in secured debt,
respectively. As of March 31, 2022,
98.8% of our debt investments based on fair value in our portfolio
were at floating rates.
As of March 31, 2022 and
December 31, 2021, the weighted
average total yield of accruing debt and income-producing
securities at fair value (which includes interest income and
amortization of fees and discounts) remained at 7.9% and the
weighted average total yield of accruing debt and income-producing
securities at amortized cost (which includes interest income and
amortization of fees and discounts) was 8.0% and 7.9%,
respectively.
As of March 31, 2022, 1 portfolio
company with an aggregate fair value of $13.6 million was on non-accrual status,
representing 0.1% of the total fair value of the debt
portfolio.
RESULTS OF OPERATIONS FOR THE
QUARTER ENDED MARCH 31,
2022
Investment Income
Investment income increased
to $264.2 million for the three
months ended March 31, 2022 from
$221.6 million for the three months
ended March 31, 2021. In addition to
the growth in the portfolio, the incremental increase in investment
income was primarily due to an increase in dividend income.
Included in interest income are other fees such as prepayment fees
and accelerated amortization of upfront fees from unscheduled
paydowns. Period over period, income generated from these fees
slightly decreased. Other income increased period-over-period due
to an increase in incremental fee income, which are fees that are
generally available to us as a result of closing investments and
generally paid at the time of closing. We expect that investment
income will vary based on a variety of factors including the pace
of our originations and repayments.
Expenses
Total expenses increased to
$141.0 million for the three months
ended March 31, 2022 from
$117.8 million for the three months
ended March 31, 2021, which was
primarily due to an increase in interest expense and management and
incentive fees. The increase in interest expense was primarily
driven by an increase in the average daily borrowings partially
offset by a decrease in the average interest rate. Management and
incentive fees increased primarily due to an increase in our
investment portfolio.
Liquidity and Capital Resources
As of
March 31, 2022, we had $0.3 billion in cash and restricted cash,
$7.2 billion in total principal value
of debt outstanding, and $1.4 billion
of undrawn capacity on our credit facilities. The Company's
weighted average interest rate on debt outstanding remained at 2.9%
for the three months ended March 31,
2022 and December 31, 2021.
Ending net debt to equity was 1.17x and 1.13x as of March 31, 2022 and December 31, 2021, respectively.
CONFERENCE CALL AND WEBCAST
INFORMATION
Conference Call Information:
The conference
call will be broadcast live on May 5,
2022 at 10:00 a.m. Eastern
Time on the Investor Resources section of ORCC's website at
www.OwlRockCapitalCorporation.com. Please visit the website to test
your connection before the webcast.
Participants are also invited to access the conference call by
dialing one of the following numbers:
- Domestic: 1 (888) 440-4182
- International: (646) 960-0653
- Conference ID: 7406736
All callers will need to enter the Conference ID followed by the
# sign and reference "Owl Rock Capital Corporation" once connected
with the operator. All callers are asked to dial in 10-15 minutes
prior to the call so that name and company information can be
collected.
Replay Information:
An archived replay will be
available for 14 days via a webcast link located on the Investor
Resources section of ORCC's website, and via the dial-in numbers
listed below:
- Domestic: 1 (800) 770-2030
- International: (647) 362-9199
- Conference ID: 7406736
FINANCIAL
HIGHLIGHTS
|
|
|
|
|
|
For the three months
ended
|
|
($ in thousands,
except per share amounts)
|
|
March 31,
2022
|
|
|
December 31,
2021
|
|
|
March 31,
2021
|
|
Investments at Fair
Value
|
|
$
|
12,756,323
|
|
|
$
|
12,741,640
|
|
|
$
|
11,240,472
|
|
Total Assets
|
|
$
|
13,203,697
|
|
|
$
|
13,298,170
|
|
|
$
|
11,588,242
|
|
Net Asset Value Per
Share
|
|
$
|
14.88
|
|
|
$
|
15.08
|
|
|
$
|
14.82
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Investment
Income
|
|
$
|
264,159
|
|
|
$
|
281,624
|
|
|
$
|
221,573
|
|
Net Investment
Income
|
|
$
|
122,356
|
|
|
$
|
137,854
|
|
|
$
|
102,655
|
|
Net Income
|
|
$
|
43,986
|
|
|
$
|
174,006
|
|
|
$
|
157,845
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Investment Income
Per Share
|
|
$
|
0.31
|
|
|
$
|
0.35
|
|
|
$
|
0.26
|
|
Net Realized and
Unrealized Gains (and Losses) Per Share
|
|
$
|
(0.20)
|
|
|
$
|
0.09
|
|
|
$
|
0.13
|
|
Net Income Per
Share
|
|
$
|
0.11
|
|
|
$
|
0.44
|
|
|
$
|
0.40
|
|
Distributions Declared
from Net Investment Income Per Share
|
|
$
|
0.31
|
|
|
$
|
0.31
|
|
|
$
|
0.31
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted Average Yield
of Accruing Debt and Income Producing Securities at Fair
Value
|
|
|
7.9
|
%
|
|
|
7.9
|
%
|
|
|
8.3
|
%
|
Weighted Average Yield
of Accruing Debt and Income Producing Securities at Amortized
Cost
|
|
|
8.0
|
%
|
|
|
7.9
|
%
|
|
|
8.2
|
%
|
Percentage of Debt
Investment Commitments at Floating Rates
|
|
|
98.8
|
%
|
|
|
98.9
|
%
|
|
|
99.9
|
%
|
CONSOLIDATED
STATEMENTS OF ASSETS AND LIABILITIES
|
|
|
|
|
|
|
|
|
($ in thousands,
except per share amounts)
|
|
March 31, 2022
(Unaudited)
|
|
|
December 31, 2021
|
|
Assets
|
|
|
|
|
|
|
|
|
Investments at fair
value
|
|
|
|
|
|
|
|
|
Non-controlled,
non-affiliated investments (amortized cost of $12,056,205 and
$12,073,126, respectively)
|
|
$
|
12,028,349
|
|
|
$
|
12,124,860
|
|
Controlled,
affiliated investments (amortized cost of $698,379 and $575,427,
respectively)
|
|
|
727,974
|
|
|
|
616,780
|
|
Total investments at
fair value (amortized cost of $12,754,584 and $12,648,553,
respectively)
|
|
|
12,756,323
|
|
|
|
12,741,640
|
|
Cash (restricted cash
of $57,497 and $21,481, respectively)
|
|
|
326,378
|
|
|
|
431,442
|
|
Foreign cash (cost of
$6,369 and $16,096, respectively)
|
|
|
6,387
|
|
|
|
15,703
|
|
Interest
receivable
|
|
|
89,921
|
|
|
|
81,716
|
|
Receivable from a
controlled affiliate
|
|
|
15,903
|
|
|
|
3,953
|
|
Prepaid expenses and
other assets
|
|
|
8,785
|
|
|
|
23,716
|
|
Total Assets
|
|
$
|
13,203,697
|
|
|
$
|
13,298,170
|
|
Liabilities
|
|
|
|
|
|
|
|
|
Debt (net of
unamortized debt issuance costs of $106,698 and $110,239,
respectively)
|
|
$
|
7,034,218
|
|
|
$
|
7,079,326
|
|
Distribution
payable
|
|
|
122,320
|
|
|
|
122,068
|
|
Management fee
payable
|
|
|
47,413
|
|
|
|
46,770
|
|
Incentive fee
payable
|
|
|
25,954
|
|
|
|
29,242
|
|
Payables to
affiliates
|
|
|
2,843
|
|
|
|
5,802
|
|
Payables for
investments purchased
|
|
|
867
|
|
|
|
—
|
|
Accrued expenses and
other liabilities
|
|
|
98,588
|
|
|
|
77,085
|
|
Total Liabilities
|
|
|
7,332,203
|
|
|
|
7,360,293
|
|
Commitments and
contingencies
|
|
|
|
|
|
|
|
|
Net
Assets
|
|
|
|
|
|
|
|
|
Common shares $0.01 par
value, 500,000,000 shares authorized; 394,580,939 and 393,766,855
shares
issued and outstanding, respectively
|
|
|
3,946
|
|
|
|
3,938
|
|
Additional
paid-in-capital
|
|
|
6,002,303
|
|
|
|
5,990,360
|
|
Total distributable
earnings (losses)
|
|
|
(134,755)
|
|
|
|
(56,421)
|
|
Total Net Assets
|
|
|
5,871,494
|
|
|
|
5,937,877
|
|
Total Liabilities and Net Assets
|
|
$
|
13,203,697
|
|
|
$
|
13,298,170
|
|
Net Asset Value Per Share
|
|
$
|
14.88
|
|
|
$
|
15.08
|
|
CONSOLIDATED
STATEMENTS OF OPERATIONS
|
|
|
|
|
|
|
|
For the Three Months
Ended March 31,
|
|
($ in thousands,
except per share amounts)
|
|
2022
|
|
|
2021
|
|
Investment
Income
|
|
|
|
|
|
|
|
|
Investment income from
non-controlled, non-affiliated investments:
|
|
|
|
|
|
|
|
|
Interest income
|
|
$
|
208,599
|
|
|
$
|
200,305
|
|
Payment-in-kind interest income
|
|
|
22,411
|
|
|
|
10,727
|
|
Dividend income
|
|
|
11,728
|
|
|
|
3,559
|
|
Other income
|
|
|
3,848
|
|
|
|
3,154
|
|
Total investment income
from non-controlled, non-affiliated investments
|
|
|
246,586
|
|
|
|
217,745
|
|
Investment income from
controlled, affiliated investments:
|
|
|
|
|
|
|
|
|
Interest income
|
|
|
1,773
|
|
|
|
1,303
|
|
Dividend income
|
|
|
15,638
|
|
|
|
2,368
|
|
Other Income
|
|
|
162
|
|
|
|
157
|
|
Total investment income
from controlled, affiliated investments
|
|
|
17,573
|
|
|
|
3,828
|
|
Total Investment
Income
|
|
|
264,159
|
|
|
|
221,573
|
|
Expenses
|
|
|
|
|
|
|
|
|
Interest expense
|
|
|
61,378
|
|
|
|
48,076
|
|
Management fee
|
|
|
47,413
|
|
|
|
42,110
|
|
Performance based incentive fees
|
|
|
25,954
|
|
|
|
21,775
|
|
Professional fees
|
|
|
3,828
|
|
|
|
3,768
|
|
Directors' fees
|
|
|
290
|
|
|
|
244
|
|
Other general and administrative
|
|
|
2,132
|
|
|
|
1,818
|
|
Total Operating
Expenses
|
|
|
140,995
|
|
|
|
117,791
|
|
Net Investment
Income (Loss) Before Taxes
|
|
|
123,164
|
|
|
|
103,782
|
|
Income tax expense (benefit), including excise tax expense
(benefit)
|
|
|
808
|
|
|
|
1,127
|
|
Net Investment
Income (Loss) After Taxes
|
|
$
|
122,356
|
|
|
$
|
102,655
|
|
Net Realized and
Change in Unrealized Gain (Loss)
|
|
|
|
|
|
|
|
|
Net change in
unrealized gain (loss):
|
|
|
|
|
|
|
|
|
Non-controlled, non-affiliated investments
|
|
$
|
(69,948)
|
|
|
$
|
57,079
|
|
Income tax (provision) benefit
|
|
|
—
|
|
|
|
(2,633)
|
|
Controlled affiliated investments
|
|
|
(11,758)
|
|
|
|
865
|
|
Translation of assets and liabilities in foreign
currencies
|
|
|
(481)
|
|
|
|
(2,432)
|
|
Total Net Change in
Unrealized Gain (Loss)
|
|
|
(82,187)
|
|
|
|
52,879
|
|
Net realized gain
(loss):
|
|
|
|
|
|
|
|
|
Non-controlled, non-affiliated investments
|
|
|
4,702
|
|
|
|
1,154
|
|
Foreign currency transactions
|
|
|
(885)
|
|
|
|
1,157
|
|
Total Net Realized
Gain (Loss)
|
|
|
3,817
|
|
|
|
2,311
|
|
Total Net Realized
and Change in Unrealized Gain (Loss)
|
|
|
(78,370)
|
|
|
|
55,190
|
|
Net Increase
(Decrease) in Net Assets Resulting from Operations
|
|
$
|
43,986
|
|
|
$
|
157,845
|
|
Earnings Per Share - Basic and Diluted
|
|
$
|
0.11
|
|
|
$
|
0.40
|
|
Weighted Average Shares Outstanding - Basic and
Diluted
|
|
|
394,309,578
|
|
|
|
391,114,767
|
|
PORTFOLIO AND
INVESTMENT ACTIVITY
|
|
|
|
|
|
For the Three Months
Ended March 31,
|
|
($ in
thousands)
|
|
2022
|
|
|
2021
|
|
New investment
commitments
|
|
|
|
|
|
|
|
|
Gross
originations
|
|
$
|
533,848
|
|
|
|
919,685
|
|
Less: Sell
downs
|
|
|
(3,409)
|
|
|
|
(56,145)
|
|
Total new investment commitments
|
|
$
|
530,439
|
|
|
$
|
863,540
|
|
Principal amount of
investments funded:
|
|
|
|
|
|
|
|
|
First-lien
senior secured debt investments
|
|
$
|
223,302
|
|
|
$
|
529,122
|
|
Second-lien
senior secured debt investments
|
|
|
1,000
|
|
|
|
12,400
|
|
Unsecured debt
investments
|
|
|
69,989
|
|
|
|
132,288
|
|
Preferred equity
investments(3)
|
|
|
7,000
|
|
|
|
1,000
|
|
Common equity
investments(3)
|
|
|
1,968
|
|
|
|
7,567
|
|
Investment funds
and vehicles
|
|
|
44,625
|
|
|
|
2,000
|
|
Total principal amount of investments funded
|
|
$
|
347,884
|
|
|
$
|
684,377
|
|
Principal amount of
investments sold or repaid:
|
|
|
|
|
|
|
|
|
First-lien
senior secured debt investments
|
|
$
|
(326,994)
|
|
|
$
|
(287,315)
|
|
Second-lien
senior secured debt investments
|
|
|
(25,000)
|
|
|
|
(224,851)
|
|
Unsecured debt
investments
|
|
|
—
|
|
|
|
—
|
|
Preferred equity
investments(3)
|
|
|
(22,843)
|
|
|
|
—
|
|
Common equity
investments(3)
|
|
|
—
|
|
|
|
—
|
|
Investment funds
and vehicles
|
|
|
—
|
|
|
|
—
|
|
Total principal amount of investments sold or
repaid
|
|
$
|
(374,837)
|
|
|
$
|
(512,166)
|
|
Number of new
investment commitments in new
portfolio companies(1)
|
|
|
17
|
|
|
8
|
|
Average new
investment commitment amount
|
|
|
21,952
|
|
|
$
|
78,952
|
|
Weighted average
term for new debt investment
commitments (in years)
|
|
|
5.1
|
|
|
|
5.8
|
|
Percentage of new
debt investment commitments at
floating rates
|
|
|
97.3
|
%
|
|
|
100.0
|
%
|
Percentage of new
debt investment commitments at
fixed
rates
|
|
|
2.7
|
%
|
|
|
0.0
|
%
|
Weighted average
interest rate of new debt investment
commitments(2)
|
|
|
7.4
|
%
|
|
|
7.3
|
%
|
Weighted average
spread over LIBOR of new floating
rate debt investment commitments
|
|
|
6.5
|
%
|
|
|
6.4
|
%
|
________________
(1)
|
Number of new
investment commitments represents commitments to a particular
portfolio company.
|
(2)
|
Assumes each floating
rate commitment is subject to the greater of the interest rate
floor (if applicable) or 3-month LIBOR, which was 0.96% and 0.19%
as of March 31, 2022 and 2021, respectively.
|
(3)
|
As of March 31, 2021,
preferred equity investments and common equity investments were
reported in aggregate as equity investments.
|
ABOUT OWL ROCK CAPITAL CORPORATION
Owl Rock Capital Corporation (NYSE: ORCC) is a specialty finance
company focused on lending to U.S. middle-market companies. As of
March 31, 2022, ORCC had investments
in 157 portfolio companies with an aggregate fair value of
$12.8 billion. ORCC has elected to be
regulated as a business development company under the Investment
Company Act of 1940, as amended. ORCC is externally managed by Owl
Rock Capital Advisors LLC, an SEC-registered investment adviser
that is an indirect affiliate of Blue Owl Capital Inc. ("Blue Owl")
(NYSE: OWL) and part of Owl Rock, a division of Blue Owl. Owl Rock,
together with its subsidiaries, is a New
York based direct lending platform.
Certain information contained herein may constitute
"forward-looking statements" that involve substantial risks and
uncertainties. Such statements involve known and unknown risks,
uncertainties and other factors and undue reliance should not be
placed thereon. These forward-looking statements are not historical
facts, but rather are based on current expectations, estimates and
projections about ORCC, its current and prospective portfolio
investments, its industry, its beliefs and opinions, and its
assumptions. Words such as "anticipates," "expects," "intends,"
"plans," "will," "may," "continue," "believes," "seeks,"
"estimates," "would," "could," "should," "targets," "projects,"
"outlook," "potential," "predicts" and variations of these words
and similar expressions are intended to identify forward-looking
statements. These statements are not guarantees of future
performance and are subject to risks, uncertainties and other
factors, some of which are beyond ORCC's control and difficult to
predict and could cause actual results to differ materially from
those expressed or forecasted in the forward-looking statements
including, without limitation, the risks, uncertainties and other
factors identified in ORCC's filings with the SEC. Investors should
not place undue reliance on these forward-looking statements, which
apply only as of the date on which ORCC makes them. ORCC does not
undertake any obligation to update or revise any forward-looking
statements or any other information contained herein, except as
required by applicable law.
INVESTOR CONTACTS
Investor Contact:
Dana
Sclafani
212-419-3000
owlrockir@blueowl.com
Media Contact:
Prosek Partners
David Wells / Josh Clarkson
pro-owlrock@prosek.com
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SOURCE Owl Rock Capital Corporation