Declares a $0.34 Per Share Distribution
New Originations and Portfolio Optimization Drive 126 Basis Point
Increase in Average Yield of Portfolio to 11.50%
CHICAGO--(BUSINESS WIRE)--
OFS Capital Corporation (NASDAQ:OFS) ("OFS Capital", "we", "us", or
"our") today announced its financial results for the fiscal quarter
ended June 30, 2015.
SECOND QUARTER FINANCIAL HIGHLIGHTS
-
Net investment income of $2.8 million, or $0.28 per share—an increase
of 31% year-over-year
-
Adjusted net investment income (a non-GAAP measure described below) of
$3.4 million, or $0.35 per share—an increase of 60% year-over-year
-
Net asset value per share increased to $14.66 at June 30, 2015 from
$14.24 per share at March 31, 2015
-
Originations were $25.4 million in the quarter compared to $20 million
in the year-earlier period
-
Weighted average yield of portfolio increased to 11.50%, up 126 basis
points from the previous quarter
-
Weighted average fixed interest rate on the SBA debentures as of June
30, 2015 was 3.18%—100% of debt is fixed rate through SBIC financing
-
Portfolio consisted of only one loan on non-accrual, representing less
than 1% of fair value of total assets, and had no investments in the
oil and gas sector
SECOND QUARTER EVENTS
-
On August 6, 2015, OFS Capital's Board of Directors declared a
distribution of $0.34 per share for the third quarter of 2015, payable
on September 30, 2015 to shareholders of record as of September 16,
2015
-
Sold loans from senior club loan portfolio with aggregate principal
balance of $67.8 million; sale proceeds were $0.6 million above March
31, 2015 fair value and applied $52.4 million to pay in full and
retire credit facility
-
Realized $1.5 million gain on sale of equity investment in Convene
(also known as Sentry Centers); remain a lender to the company
"We are proud of our direct origination capabilities in the middle
market, which continue to differentiate us in the industry. We believe
our balance sheet is positioned for a rising interest rate environment
as a majority of our loan portfolio is floating rate and all of our debt
is fixed rate with long-term maturities. Our adjusted net investment
income exceeded our dividend, and we believe we have a clear path to
further increasing our earnings through continuing to redeploy our
capital into higher yielding investments. Our focus remains the same—to
protect shareholder value. As a 30% owner of the company, our external
manager's interests are aligned with those of our other shareholders,"
said Bilal Rashid, Chairman and Chief Executive Officer of OFS Capital.
HIGHLIGHTS
($ in millions, except for per share data)
|
Portfolio Overview
|
As of June 30, 2015
|
|
Total assets
|
$299.7 |
|
Investment portfolio, at fair value
|
$256.0 |
|
Net assets
|
$141.8 |
|
Net asset value per share
|
$14.66 |
|
Weighted average yield on debt investments (at fair value)
|
11.50%
|
|
Operating Results
|
Quarter ended June 30,
|
|
|
2015
|
2014
|
|
Total investment income
|
$8.1 |
$4.7 |
|
Net investment income
|
$2.8 |
$2.1 |
|
Net investment income per common share, basic and diluted
|
$0.28 |
$0.22 |
|
Adjusted net investment income (a Non-GAAP measure described below)
|
$3.4 |
$2.1 |
|
Adjusted net investment income (a Non-GAAP measure described below)
per share, basic and diluted
|
$0.35 |
$0.22 |
|
Net increase in net assets resulting from operations
|
$7.4 |
$0.6 |
|
|
|
|
|
Portfolio Activity
|
Quarter ended June 30,
|
|
|
2015
|
2014
|
|
Number of new investments
|
4
|
3
|
|
Investments in new portfolio companies
|
$13.5 |
$20.0 |
|
Investments in existing portfolio companies
|
$11.9 |
-
|
|
Number of portfolio companies at end of period
|
39
|
57
|
|
|
|
|
PORTFOLIO AND INVESTMENT ACTIVITIES
During the second quarter of 2015, OFS Capital closed new investments in
four portfolio companies totaling approximately $25.4 million.
Specifically, SBIC I LP made two new investments with two portfolio
companies (one new and one existing) consisting of $16.7 million of
senior secured debt investments and $3.7 million of equity investments.
In addition, OFS Capital made two new senior secured debt investments of
$5.0 million during the second quarter of 2015.
The total fair value of OFS Capital's investment portfolio was $256.0
million as of June 30, 2015, which was equal to 100.9% of cost. The
portfolio included outstanding loans of approximately $236.4 million in
aggregate principal amount (with an aggregate fair value of $231.0
million) in 38 portfolio companies. Of this $236.4 million, SBIC I LP
held debt investments of approximately $199.5 million in aggregate
principal amount ($198.4 million fair value) in 26 portfolio companies.
SBIC I LP also held equity securities with an aggregate fair value of
$24.9 million. Of this $24.9 million, $23.6 million was invested in 15
portfolio companies in which SBIC I LP also held debt investments and
$1.3 million was invested in one portfolio company in which SBIC I LP
solely held an equity investment.
As of June 30, 2015, floating rate loans comprised 59% of OFS Capital's
debt investment portfolio, with the remaining 41% in fixed rate loans,
as a percentage of fair value. As of June 30, 2015, 66% of OFS Capital's
investment portfolio at fair value was comprised of senior secured
loans, 25% of subordinated loans, and 9% of equity investments. The
weighted average yield on debt investments was 11.50% at June 30, 2015.
OFS Capital had unfunded commitments of $8.1 million in six portfolio
companies at quarter's end.
OFS Capital WM Asset Sale and Related Transactions
On May 28, 2015, we entered into a Loan Portfolio Purchase Agreement
with Madison Capital Funding LLC ("Madison"), pursuant to which we sold
20 senior secured debt investments held by OFS Capital WM with an
aggregate outstanding principal balance of $67.8 million to Madison (the
"WM Asset Sale") for cash proceeds of $67.3 million. Madison is an
affiliated entity of MCF Capital Management, LLC ("MCF"), which was the
loan manager for OFS Capital WM prior to the WM Asset Sale under a Loan
and Security Agreement among OFS Capital WM, MCF, Wells Fargo
Securities, LLC, each of the Lenders from time to time party thereto,
and Wells Fargo Delaware Trust Company, N.A. (the "Loan and Security
Agreement").
In connection with the WM Asset Sale, we recognized a realized gain of
$2.7 million, and reversed previously recorded net unrealized
appreciation associated with the sold assets in the total amount of $2.1
million. The realized gain pertained primarily to the net unrealized
depreciation embedded in the sold assets prior to our IPO.
On May 28, 2015, pursuant to the Loan and Security Agreement, we applied
$52.4 million from the sale proceeds of the WM Asset Sale to pay in full
and retire OFS Capital WM's secured revolving credit facility with Wells
Fargo Bank, N.A. ("WM Credit Facility"). As a result of the termination
of the WM Credit Facility, we wrote-off the remaining related
unamortized deferred financing closing costs of $1.2 million on the
revolving line of credit.
On May 28, 2015, in connection with the WM Asset Sale, we entered into a
Loan Administration Services Agreement with Madison pursuant to which
Madison will provide loan servicing and other administrative services to
OFS Capital WM with respect certain of its remaining loan assets. In
return for its loan administration services, Madison will receive a
quarterly loan administration fee of 0.25% per annum based on the
average daily principal balances of the loan assets for such quarter.
For the three and six months ended June 30, 2015, we incurred loan
administration fee of $5,000 to Madison.
RESULTS OF OPERATIONS
Investment income
Total investment income increased by approximately $3.4 million, or 73%,
for the three months ended June 30, 2015 as compared to the three months
ended June 30, 2014. The $3.4 million increase in total investment
income was due to an increase in interest income, and dividend and fee
income. The increase in interest income was primarily attributable to a
significant increase in debt investments originated by SBIC I LP ("SBIC
I LP Investments") since June 30, 2014, which typically have a higher
yield than the debt investments held by OFS Capital WM ("OFS Capital WM
Investments"). The increase in dividend and fee income was primarily
attributable to our recognition of dividend income contractually earned
but not declared on certain of our preferred equity investments
primarily held by SBIC I LP during the three months ended June 30, 2015,
as well as fee income recognized by SBIC I LP in connection with certain
of its debt investments. The increase in total investment income from
SBIC I LP Investments was offset by a decrease in interest income from
OFS Capital WM Investments due to a decrease in OFS Capital WM
Investments since the quarter ended June 30, 2014.
Interest Income:
For the three months ended June 30, 2015, we generated total interest
income from non-control/non-affiliate investments of approximately $6.1
million, of which approximately $4.5 million was generated by SBIC I LP
Investments and $1.6 million by OFS Capital WM Investments. For the
three months ended June 30, 2014, interest income from
non-control/non-affiliate investments was approximately $3.5 million, of
which approximately $0.7 million was generated by SBIC I LP Investments
and $2.8 million by OFS Capital WM Investments. The increase in interest
income from non-control/non-affiliate investments generated by SBIC I LP
Investments of approximately $3.8 million was attributable to an
increase in debt investments originated by SBIC I LP since the quarter
ended June 30, 2014. The decrease in interest income from
non-control/non-affiliate investments generated by OFS Capital WM
Investments of approximately $1.2 million was primarily due to the
decrease in OFS Capital WM Investments since the quarter ended June 30,
2014.
SBIC I LP holds all of our affiliate investments. For the three months
ended June 30, 2015 and 2014, SBIC I LP generated total interest income
from affiliate investments of approximately $1.4 million and $0.8
million, respectively. The increase in total interest income from
affiliate investments of approximately $0.6 million was primarily due to
an increase in debt investments originated by SBIC I LP since the
quarter ended June 30, 2014.
SBIC I LP held our only control investment in Tangible Software, Inc.
("Tangible") until December 17, 2014, when the Tangible investment was
restructured. The post-restructured debt investment was categorized as
an affiliate investment. For the three months ended June 30, 2014, SBIC
I LP generated total interest income from its control investment of
approximately $0.3 million.
Dividend and Fee Income:
During the three months ended June 30, 2015 and 2014, SBIC I LP
generated dividend and fee income of approximately $0.6 million and $0.1
million, respectively. The increase in dividend and fee income of
approximately $0.5 million was primarily due to our recognition of
approximately $0.3 million of dividend income contractually earned but
not declared on certain of our preferred equity investments primarily
held by SBIC I LP during the three months ended June 31, 2015, as well
as fee income of approximately $0.2 million recognized by SBIC I LP in
connection with certain of its debt investments.
Total expenses
Total expenses increased by approximately $2.7 million, or 104%, for the
three months ended June 30, 2015 as compared to the three months ended
June 30, 2014.
Interest expense increased by approximately $0.3 million for the three
months ended June 30, 2015, compared to the three months ended June 30,
2014, due to an increase of approximately $0.9 million in interest
expense incurred on our SBA debentures, the balance of which increased
substantially at June 30, 2015 compared with the debenture balance at
June 30, 2014. This increase was offset by a 2015 decrease of
approximately $0.6 million in interest expense on the WM Credit
Facility, primarily due to lower borrowings on the facility in 2015 and
the termination of the facility on May 28, 2015.
Amortization and write-off of deferred financing closing costs increased
by approximately $1.2 million for the three months ended June 30, 2015,
compared to the three months ended June 30, 2014, primarily due to a
write-off of the remaining deferred financing closing costs in the
amount of approximately $1.2 million in connection with our full payoff
and retirement of the WM Credit Facility on May 28, 2015.
Management fee expense totaled approximately $1.4 million for the three
months ended June 30, 2015, consisting of approximately $1.3 million of
base management fee expense we incurred to OFS Capital Management, LLC,
our investment advisor ("OFS Advisor"), and approximately $0.1 million
of loan management fee charged by MCF, the loan manager for OFS Capital
WM prior to the termination of the WM Credit Facility. Management fee
expense totaled approximately $0.5 million for the three months ended
June 30, 2014, consisting of approximately $0.3 million of base
management fee expense we incurred to OFS Advisor and approximately $0.2
million of loan management fee charged by MCF. The base management fee
to OFS Advisor increased by a total of approximately $1.0 million, of
which approximately $0.1 million was due to an increase in our average
total assets at June 30, 2015 and March 31, 2015 ("2015 Management Fee
Base"), as compared to our average total assets at June 30, 2014 and
March 31, 2014 ("2014 Management Fee Base"), and approximately $0.9
million was due to the reset of our base management fee to 0.4375% per
quarter effective January 1, 2015 as compared with 0.145833% effective
April 1, 2014. The increase in the 2015 Management Fee Base as compared
to the 2014 Management Fee Base was largely attributable to the higher
SBIC I LP Investments balance at June 30, 2015 as compared to June 30,
2014.
For the three months ended June 30, 2015 we incurred an incentive fee
expense to OFS Advisor in the amount of approximately $0.2 million. We
did not incur an incentive fee expense for the three months ended June
30, 2014.
Net realized and unrealized gain (loss) on investments
For the three months ended June 30, 2015, we recorded net realized gain
on non-control/non affiliate investments of approximately $2.8 million,
of which approximately $2.7 million represented net realized gain in
connection with the WM Asset Sale. For the three months ended June 30,
2015, we recorded net realized gain on affiliate investments of
approximately $1.5 million related to the sale of two of our equity
investments.
For the three months ended June 30, 2015, we recorded net change in
unrealized appreciation/depreciation on non-control/non-affiliate
investments of approximately $(0.7) million, consisting of approximately
$(2.1) million of a reversal of previously recorded net unrealized
appreciation associated with the WM Asset Sale, net unrealized
depreciation of $(0.3) million on debt investments held by OFS Capital
WM ($(0.2) million was attributable to its sole non-accrual loan),
offset by approximately $1.7 million of net unrealized appreciation on
debt and equity investments held by SBIC I LP. In addition, for the
three months ended June 30, 2015, we recorded net change in unrealized
appreciation/depreciation on affiliate investments of approximately $1.1
million, consisting of approximately $1.8 million of net unrealized
appreciation on debt and equity investments held by SBIC I LP, offset by
approximately $(0.7) million of a reversal of previously recorded net
unrealized appreciation in connection with an equity sale.
For the three months ended June 30, 2014, we recorded approximately
$(1.2) million of net change in unrealized depreciation on
non-control/non-affiliate investments, consisting of approximately
$(1.3) million of net change in unrealized depreciation on
non-control/non-affiliate investments held by OFS Capital WM, and
approximately $0.1 million of net change in unrealized depreciation on
non-control/non-affiliate investments held by SBIC I LP. In addition,
for the three months ended June 30, 2014, we recorded approximately $0.1
million of net change in unrealized appreciation on affiliate
investments held by SBIC I LP, as well as approximately $(0.4) million
of net change in unrealized depreciation on a control investment held by
SBIC I LP (Tangible).
LIQUIDITY AND CAPITAL RESOURCES
At June 30, 2015 and December 31, 2014, we had cash and cash equivalents
of $35.6 million and $12.4 million, respectively. During the six months
ended June 30, 2015, we had net cash provided by operating activities of
$80.0 million, primarily due to cash collections of $89.1 million from
the sale of our portfolio investments, including $7.2 million of cash
collection from an investment we sold in December 2014, $67.3 million
from the WM Asset Sale, and $3.5 million from the sale of our equity
interests in two portfolio companies, $31.2 million of cash we received
from principal payments on our portfolio investments, as well as our
$10.6 million net increase in net assets resulting from operations.
These cash receipts were offset by $45.9 million of cash we used to
purchase portfolio investments.
Net cash used in financing activities was $(56.8) million for the six
months ended June 30, 2015, primarily attributable to $22.6 million of
draws from our SBA debentures (net of the fees), offset by the $72.6
million of net repayments on the WM Credit Facility which was paid in
full and retired on May 28, 2015 and $6.3 million of cash we paid in
dividends and distributions.
We intend to generate additional cash flows from our operations, future
offerings of securities, and future borrowings. In addition, we may
determine to sell lower-yielding investments in the portfolio to
generate liquidity for the acquisition of higher-yielding investments.
Our primary uses of funds are investments in debt and equity
investments, interest payments on indebtedness, payment of other
expenses, and cash distributions to our shareholders.
CONFERENCE CALL
OFS Capital will host a conference call to discuss these results on
Friday, August 7, 2015 at 11:00 AM Eastern Time. Interested parties may
participate in the call via the following:
INTERNET: Log on to www.ofscapital.com
at least 15 minutes prior to the start time of the call to register,
download, and install any necessary audio software. A replay will be
available for 90 days on the Company's website at www.ofscapital.com.
TELEPHONE: Dial (877) 510-7674 (Domestic) or (412) 902-4139
(International) approximately 15 minutes prior to the call. A telephone
replay of the conference call will be available through August 17, 2015
at 9:00 AM Eastern Time and may be accessed by calling (877) 344-7529
(Domestic) or (412) 317-0088 (International) and utilizing conference ID
# 10070137.
For more detailed discussion of the financial and other information
included in this press release, please refer to OFS Capital's Form 10-Q
for the quarter ended June 30, 2015, which is to be filed with the
Securities and Exchange Commission.
|
OFS Capital Corporation and Subsidiaries
|
|
|
|
|
|
|
|
|
|
|
|
Consolidated Balance Sheets (unaudited)
|
|
|
|
|
|
(Dollar amounts in thousands, except per share data)
|
|
|
|
|
|
|
|
June 30,
|
|
December 31,
|
|
|
|
2015
|
|
2014
|
|
Assets
|
|
|
|
|
|
Investments, at fair value
|
|
|
|
|
|
Non-control/non-affiliate investments (cost of $188,680 and
$258,004, respectively)
|
|
$ 187,195 |
|
$ 254,666 |
|
Affiliate investments (cost of $64,929 and $55,569, respectively)
|
|
68,771
|
|
57,568
|
|
Total investments at fair value
|
|
255,966
|
|
312,234
|
|
Cash and cash equivalents
|
|
35,568
|
|
12,447
|
|
Interest receivable
|
|
845
|
|
676
|
|
Receivable from investment sold
|
|
-
|
|
7,223
|
|
Prepaid expenses and other assets
|
|
420
|
|
556
|
|
Intangible asset, net of accumulated amortization of $307 and $209,
respectively
|
|
2,193
|
|
2,291
|
|
Goodwill
|
|
1,077
|
|
1,077
|
|
Deferred financing closing costs, net of accumulated amortization of
$219 and $2,540, respectively
|
|
3,611
|
|
4,972
|
|
Total assets
|
|
$ 299,680 |
|
$ 341,476 |
|
|
|
|
|
|
|
Liabilities
|
|
|
|
|
|
Accrued professional fees
|
|
$ 435 |
|
$ 462 |
|
Interest payable
|
|
1,280
|
|
1,315
|
|
Management and incentive fees payable
|
|
1,507
|
|
1,229
|
|
Administration fee payable
|
|
326
|
|
273
|
|
Payable for investment purchased
|
|
3,960
|
|
-
|
|
Other payables
|
|
240
|
|
247
|
|
Deferred loan fee revenue
|
|
212
|
|
572
|
|
SBA debentures payable
|
|
149,880
|
|
127,295
|
|
Revolving line of credit
|
|
-
|
|
72,612
|
|
Total liabilities
|
|
157,840
|
|
204,005
|
|
|
|
|
|
|
|
Commitments and Contingencies
|
|
|
|
|
|
|
|
|
|
|
|
Net Assets
|
|
|
|
|
|
Preferred stock, par value of $0.01 per share, 2,000,000 shares
authorized,
|
|
|
|
|
|
0 shares issued and outstanding as of June 30, 2015 and December 31,
2014 |
|
-
|
|
-
|
|
Common stock, par value of $0.01 per share, 100,000,000 shares
authorized, 9,675,774 and 9,650,834
|
|
|
|
shares issued and outstanding as of June 30, 2015 and December 31,
2014, respectively
|
|
97
|
|
97
|
|
Paid-in capital in excess of par
|
|
143,683
|
|
143,381
|
|
Distributions in excess of net investment income
|
|
(8,859)
|
|
(7,844)
|
|
Accumulated net realized gain (loss)
|
|
3,454
|
|
(844)
|
|
Net unrealized appreciation on investments
|
|
3,465
|
|
2,681
|
|
Total net assets
|
|
141,840
|
|
137,471
|
|
|
|
|
|
|
|
Total liabilities and net assets
|
|
$ 299,680 |
|
$ 341,476 |
|
|
|
|
|
|
|
Number of shares outstanding
|
|
9,675,774
|
|
9,650,834
|
|
Net asset value per share
|
|
$ 14.66 |
|
$ 14.24 |
|
|
|
|
|
|
|
OFS Capital Corporation and Subsidiaries
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Consolidated Statements of Operations (unaudited)
|
|
|
|
|
|
|
|
|
|
(Dollar amounts in thousands, except per share data)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended June 30,
|
|
Six Months Ended June 30,
|
|
|
|
2015
|
|
2014
|
|
2015
|
|
2014
|
|
|
|
|
|
|
|
|
|
|
|
Investment income
|
|
|
|
|
|
|
|
|
|
Interest income
|
|
|
|
|
|
|
|
|
|
Non-control/non-affiliate investments
|
|
$ 6,117 |
|
$ 3,524 |
|
$ 11,932 |
|
$ 7,310 |
|
Affiliate investments
|
|
1,411
|
|
792
|
|
2,754
|
|
1,619
|
|
Control investment
|
|
-
|
|
264
|
|
-
|
|
566
|
|
Total interest income
|
|
7,528
|
|
4,580
|
|
14,686
|
|
9,495
|
|
Dividend and fee income
|
|
|
|
|
|
|
|
|
|
Non-control/non-affiliate investments
|
|
101
|
|
-
|
|
286
|
|
8
|
|
Affiliate investments
|
|
453
|
|
53
|
|
731
|
|
117
|
|
Control investment
|
|
-
|
|
25
|
|
-
|
|
50
|
|
Total dividend and fee income
|
|
554
|
|
78
|
|
1,017
|
|
175
|
|
|
|
|
|
|
|
|
|
|
|
Total investment income
|
|
8,082
|
|
4,658
|
|
15,703
|
|
9,670
|
|
|
|
|
|
|
|
|
|
|
|
Expenses
|
|
|
|
|
|
|
|
|
|
Interest expense
|
|
1,323
|
|
997
|
|
2,553
|
|
1,988
|
|
Amortization of deferred financing closing costs
|
|
145
|
|
152
|
|
262
|
|
302
|
|
Write-off of deferred financing closing costs
|
|
1,216
|
|
-
|
|
1,646
|
|
-
|
|
Amortization of intangible asset
|
|
49
|
|
49
|
|
98
|
|
112
|
|
Management fees
|
|
1,426
|
|
534
|
|
2,981
|
|
1,798
|
|
Incentive fee
|
|
231
|
|
-
|
|
606
|
|
-
|
|
Professional fees
|
|
280
|
|
276
|
|
595
|
|
730
|
|
Administration fee
|
|
326
|
|
285
|
|
867
|
|
760
|
|
General and administrative expenses
|
|
334
|
|
266
|
|
594
|
|
481
|
|
|
|
|
|
|
|
|
|
|
|
Total expenses
|
|
5,330
|
|
2,559
|
|
10,202
|
|
6,171
|
|
|
|
|
|
|
|
|
|
|
|
Net investment income
|
|
2,752
|
|
2,099
|
|
5,501
|
|
3,499
|
|
|
|
|
|
|
|
|
|
|
|
Net realized and unrealized gain (loss) on investments
|
|
|
|
|
|
|
|
|
|
Net realized gain on non-control/non-affiliate investments
|
|
2,788
|
|
-
|
|
2,878
|
|
-
|
|
Net realized gain on affiliate investments
|
|
1,471
|
|
28
|
|
1,471
|
|
28
|
|
Net change in unrealized appreciation/depreciation on
|
|
|
|
|
|
|
|
|
|
non-control/non-affiliate investments
|
|
(705)
|
|
(1,247)
|
|
(1,058)
|
|
(321)
|
|
Net change in unrealized appreciation/depreciation on affiliate
investments
|
|
1,096
|
|
108
|
|
1,842
|
|
627
|
|
Net change in unrealized depreciation on control investment
|
|
-
|
|
(431)
|
|
-
|
|
(1,225)
|
|
|
|
|
|
|
|
|
|
|
|
Net realized and unrealized gain (loss) on investments
|
|
4,650
|
|
(1,542)
|
|
5,133
|
|
(891)
|
|
|
|
|
|
|
|
|
|
|
|
Net increase in net assets resulting from operations
|
|
$ 7,402 |
|
$ 557 |
|
$ 10,634 |
|
$ 2,608 |
|
|
|
|
|
|
|
|
|
|
|
Net investment income per common share - basic and diluted
|
|
$ 0.28 |
|
$ 0.22 |
|
$ 0.57 |
|
$ 0.36 |
|
Net increase in net assets resulting from operations
|
|
|
|
|
|
|
|
|
|
per common share - basic and diluted
|
|
$ 0.77 |
|
$ 0.06 |
|
$ 1.10 |
|
$ 0.27 |
|
Dividends and distributions declared per common share
|
|
$ 0.34 |
|
$ 0.34 |
|
$ 0.68 |
|
$ 0.68 |
|
Basic and diluted weighted average shares outstanding
|
|
9,663,081
|
|
9,632,491
|
|
9,657,058
|
|
9,631,826
|
|
|
|
|
|
|
|
|
|
|
Non-GAAP Financial Measure - Adjusted Net
Investment Income ("Adjusted NII")
On a supplemental basis, we disclose Adjusted NII (including on a per
share basis), which is a financial measure calculated and presented on a
basis of methodology other than in accordance with generally accepted
accounting principles of the United States of America ("non-GAAP").
Adjusted NII represents net investment income, (1) excluding write-offs
of deferred financing closing costs associated with our permanent
reductions of the WM Credit Facility, and (2) adding back the amount of
net investment income incentive fee expenses associated with the
write-offs that we would have incurred had the write-offs not occurred.
Management believes that providing Adjusted NII may facilitate a more
complete analysis and greater transparency into OFS Capital's ongoing
operations, particularly in comparing underlying results from period to
period, and afford investors a view of results that may be more easily
compared to those of other companies.
The following table provides a reconciliation from net investment income
(the most comparable GAAP measure) to Adjusted NII for the periods
presented:
|
|
|
|
|
|
|
|
|
Quarter Ended June 30,
|
|
|
|
2015
|
|
2014
|
|
|
|
(Dollar amounts in thousands, except per share data)
|
|
|
|
|
|
|
|
Net investment income
|
|
$ 2,752 |
|
$ 2,099 |
|
|
|
|
|
|
|
Write-off of deferred financing closing costs
|
|
1,216
|
|
-
|
|
Incentive fee
|
|
(609)
|
|
-
|
|
Write-off of deferred financing closing costs, net
|
|
607
|
|
-
|
|
|
|
|
|
|
|
Adjusted net investment income
|
|
$ 3,359 |
|
$ 2,099 |
|
|
|
|
|
|
|
Adjusted net investment income per common share:
|
|
|
|
|
|
Basic and diluted
|
|
$ 0.35 |
|
$ 0.22 |
|
|
|
|
|
|
|
Weighted average shares outstanding:
|
|
|
|
|
|
Basic and diluted
|
|
9,663,081
|
|
9,632,491
|
|
|
|
|
|
|
Adjusted NII may not be comparable to similar measures presented by
other companies, as it is a non-GAAP financial measure that is not based
on a comprehensive set of accounting rules or principles and therefore
may be defined differently by other companies. In addition, Adjusted NII
should be considered in addition to, not as a substitute for, or
superior to, financial measures determined in accordance with GAAP.
ABOUT OFS CAPITAL
OFS Capital is an externally managed, closed-end, non-diversified
management investment company that has elected to be regulated as a
business development company. OFS Capital's investment objective is to
provide shareholders with both current income and capital appreciation
primarily through debt investments and, to a lesser extent, equity
investments. OFS Capital invests primarily in privately-held
middle-market companies in the United States, including
lower-middle-market companies, targeting investments of $3 to $20
million in companies with annual EBITDA between $3 million and $50
million. OFS Capital offers flexible solutions through a variety of
asset classes including senior secured loans, which includes first-lien,
second-lien and unitranche loans, as well as subordinated loans and, to
a lesser extent, warrants and other minority equity securities. OFS
Capital's investment activities are managed by OFS Capital Management,
LLC, an investment adviser registered under the Investment Advisers Act
of 1940 and headquartered in Chicago, Illinois, with additional offices
in New York and Los Angeles.
FORWARD-LOOKING STATEMENTS
Statements made in this press release may contain forward-looking
statements that involve substantial risks and uncertainties, some of
which are beyond the control of OFS Capital's management, and are
difficult to predict. Such forward-looking statements are not historical
facts but, rather, reflect assumptions, estimates, and projections by
OFS Capital concerning anticipated results and provide no guarantee of
future performance. All forward-looking statements speak only as of the
date of this press release, and OFS Capital undertakes no duty to update
any forward-looking statements herein made.
View source version on businesswire.com: http://www.businesswire.com/news/home/20150807005150/en/
OFS Capital Corporation
Investor Relations:
Steve Altebrando,
646-652-8473
saltebrando@ofsmanagement.com
Source: OFS Capital Corporation
News Provided by Acquire Media