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8-K - CURRENT REPORT - BlackRock Capital Investment Corp | d8k.htm |
Total Net Assets
Total Liabilities and Net Assets
Net Asset Value Per Share
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BlackRock Kelso Capital Corporation Statements of Operations (Unaudited) |
Three
months ended March 31, 2010 |
Three
months ended March 31, 2009 |
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Investment Income: |
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From non-controlled, non-affiliated investments: |
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Interest |
$ | 25,313,012 | $ | 30,336,034 | ||||
Dividends |
503,645 | 505,209 | ||||||
From non-controlled, affiliated investments: |
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Interest |
1,460,708 | 481,385 | ||||||
Dividends |
302,163 | 273,207 | ||||||
From controlled investments: |
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Interest |
219,571 | 215,465 | ||||||
Total investment income |
27,799,099 | 31,811,300 | ||||||
Expenses: |
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Base management fees |
4,322,471 | 4,748,218 | ||||||
Incentive management fees |
493,951 | | ||||||
Interest and credit facility fees |
1,122,254 | 1,836,389 | ||||||
Investment advisor expenses |
398,664 | 346,794 | ||||||
Administrative services |
257,723 | 229,108 | ||||||
Professional fees |
203,266 | 232,050 | ||||||
Amortization of debt issuance costs |
168,292 | 168,292 | ||||||
Insurance |
152,408 | 129,361 | ||||||
Director fees |
95,837 | 95,292 | ||||||
Other |
318,968 | 274,414 | ||||||
Net expenses |
7,533,834 | 8,059,918 | ||||||
Net Investment Income |
20,265,265 | 23,751,382 | ||||||
Realized and Unrealized Gain (Loss): |
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Net realized gain (loss): |
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Non-controlled, non-affiliated investments |
(6,695,076 | ) | 4,549 | |||||
Non-controlled, affiliated investments |
(36,221,865 | ) | 12,240 | |||||
Controlled investments |
1,881 | | ||||||
Foreign currency |
551,737 | 2,111,539 | ||||||
Net realized gain (loss) |
(42,363,323 | ) | 2,128,328 | |||||
Net change in unrealized appreciation or depreciation on: |
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Non-controlled, non-affiliated investments |
15,587,411 | (23,371,679 | ) | |||||
Non-controlled, affiliated investments |
37,813,494 | (4,284,665 | ) | |||||
Controlled investments |
644,132 | (1,602,183 | ) | |||||
Foreign currency translation |
(1,463,928 | ) | (688,253 | ) | ||||
Net change in unrealized appreciation or depreciation |
52,581,109 | (29,946,780 | ) | |||||
Net realized and unrealized gain (loss) |
10,217,786 | (27,818,452 | ) | |||||
Net Increase (Decrease) in Net Assets Resulting from Operations |
$ | 30,483,051 | $ | (4,067,070 | ) | |||
Net Investment Income Per Share |
$ | 0.36 | $ | 0.43 | ||||
Earnings (Loss) Per Share |
$ | 0.54 | $ | (0.07 | ) | |||
Basic and Diluted Weighted-Average Shares Outstanding |
56,597,028 | 55,242,972 | ||||||
Dividends Declared Per Share |
$ | 0.32 | $ | 0.16 |
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Supplemental Information
The Company reports its financial results on a GAAP basis; however, management believes that evaluating the Companys ongoing operating results may be enhanced if investors have additional non-GAAP basis financial measures. Management reviews non-GAAP financial measures to assess ongoing operations and, for the reasons described below, considers them to be effective indicators, for both management and investors, of the Companys financial performance over time. The Companys management does not advocate that investors consider such non-GAAP financial measures in isolation from, or as a substitute for, financial information prepared in accordance with GAAP.
The Company records its liability for incentive management fees as it becomes legally obligated to pay them, based on a hypothetical liquidation at the end of each reporting period. The Companys obligation to pay incentive management fees with respect to any fiscal quarter is based on a formula that reflects the Companys results over a trailing four-fiscal quarter period ending with the current fiscal quarter. The Company is legally obligated to pay the amount resulting from the formula less any cash payments of incentive management fees during the prior three quarters. The formulas requirement to reduce the incentive management fee by amounts paid with respect to incentive fees in the prior three quarters has caused the Companys incentive fee expense to become, and currently is expected to be, concentrated in the fourth quarter of each year. Management believes that reflecting incentive fees throughout the year, as the related investment income is earned, is an effective measure of the Companys profitability and financial performance that facilitates comparison of current results with historical results and with those of the Companys peers. The Companys as adjusted results reflect incentive management fees based on the formula the Company utilizes for each trailing four-fiscal quarter period, with the formula applied to the current quarters incremental earnings and without any reduction for incentive management fees paid during the prior three quarters. The resulting amount represents an estimate of each quarters incremental incentive management fees that we expect we will become legally obligated to pay at the end of the year. Prior year amounts are estimated in the same manner. Changes in the economic environment, financial markets and other parameters used in determining such estimates could cause actual results to differ and such differences could be material. For a more detailed description of the Companys incentive management fee, please refer to the Companys Quarterly Report on Form 10-Q for the quarter ended March 31, 2010 and Annual Report on Form 10-K for the fiscal year ended December 31, 2009 on file with the SEC.
Computations for all periods are derived from the Companys financial statements as follows:
Three months ended March 31, 2010 |
Three
months ended March 31, 2009 |
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GAAP Basis: |
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Net Investment Income |
$ | 20,265,265 | $ | 23,751,382 | ||||
Net Increase (Decrease) in Net Assets from Operations |
30,483,051 | (4,067,070 | ) | |||||
Net Asset Value at end of period |
552,953,567 | 495,519,468 | ||||||
Less: Incremental incentive management fee expense using existing formula as applied to current period operating results |
(3,501,086 | ) | (4,616,765 | ) | ||||
As Adjusted: |
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Net Investment Income |
$ | 16,764,179 | $ | 19,134,617 | ||||
Net Increase (Decrease) in Net Assets from Operations |
26,981,965 | (8,683,835 | ) | |||||
Net Asset Value at end of period |
549,452,481 | 490,902,703 | ||||||
Per Share Amounts, GAAP Basis: |
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Net Investment Income |
$ | 0.36 | $ | 0.43 | ||||
Net Increase (Decrease) in Net Assets from Operations |
0.54 | (0.07 | ) | |||||
Net Asset Value at end of period |
9.77 | 9.04 | ||||||
Per Share Amounts, As Adjusted: |
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Net Investment Income |
$ | 0.30 | $ | 0.35 | ||||
Net Increase (Decrease) in Net Assets from Operations |
0.48 | (0.16 | ) | |||||
Net Asset Value at end of period |
9.71 | 8.96 |
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About BlackRock Kelso Capital Corporation
BlackRock Kelso Capital Corporation is a business development company formed in early 2005 by its management team, BlackRock, Inc. and principals of Kelso & Company, to provide debt and equity capital to middle-market companies.
The Companys investment objective is to generate both current income and capital appreciation through debt and equity investments. The Company invests primarily in middle-market companies in the form of senior and junior secured and unsecured debt securities and loans, each of which may include an equity component, and by making direct preferred, common and other equity investments in such companies.
Forward-Looking Statements
This press release, and other statements that BlackRock Kelso Capital may make, may contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act, with respect to BlackRock Kelso Capitals future financial or business performance, strategies or expectations. Forward-looking statements are typically identified by words or phrases such as trend, potential, opportunity, pipeline, believe, comfortable, expect, anticipate, current, intention, estimate, position, assume, outlook, continue, remain, maintain, sustain, seek, achieve, and similar expressions, or future or conditional verbs such as will, would, should, could, may or similar expressions.
BlackRock Kelso Capital cautions that forward-looking statements are subject to numerous assumptions, risks and uncertainties, which change over time. Forward-looking statements speak only as of the date they are made, and BlackRock Kelso Capital assumes no duty to and does not undertake to update forward-looking statements. Actual results could differ materially from those anticipated in forward-looking statements and future results could differ materially from historical performance.
In addition to factors previously disclosed in BlackRock Kelso Capitals Securities and Exchange Commission (SEC) reports and those identified elsewhere in this press release, the following factors, among others, could cause actual results to differ materially from forward-looking statements or historical performance: (1) our future operating results; (2) our business prospects and the prospects of our portfolio companies; (3) the impact of investments that we expect to make; (4) our contractual arrangements and relationships with third parties; (5) the dependence of our future success on the general economy and its impact on the industries in which we invest; (6) the ability of our portfolio companies to achieve their objectives; (7) our expected financings and investments; (8) the adequacy of our cash resources and working capital, including our ability to obtain continued financing on favorable terms; (9) the timing of cash flows, if any, from the operations of our portfolio companies; (10) the ability of our investment advisor to locate suitable investments for us and to monitor and administer our investments; (11) the ability of our investment advisor to attract and retain highly talented professionals; (12) fluctuations in foreign currency exchange rates; and (13) the impact of changes to tax legislation and, generally, our tax position.
BlackRock Kelso Capitals Annual Report on Form 10-K for the year ended December 31, 2009 filed with the SEC identifies additional factors that can affect forward-looking statements.
Available Information
BlackRock Kelso Capitals filings with the SEC, press releases, earnings releases and other financial information are available on its website at www.blackrockkelso.com. The information contained on our website is not a part of this press release.
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