Investcorp Credit Management BDC, Inc. (NASDAQ: ICMB) (“ICMB” or
the “Company”) today announced its financial results for its fiscal
fourth quarter ended June 30, 2019. The Company was formerly known
as CM Finance Inc through August 30, 2019
HIGHLIGHTS
- ICMB made eleven investments in six portfolio
companies. The Company invested $32.2mm in the quarter inclusive of
funding of revolving and delayed draw commitments. The
weighted average yield of debt investments made in the quarter was
11.47%
- Two investments were fully realized during the quarter.
These were the Company’s debt investment in Nexeo Plastics, and its
equity investment in Zinc Acquisition Holdings, LP
- The weighted average yield on debt investments, at
cost, increased six basis points to 10.50%, compared to 10.44% as
of March 31, 2019. The change in LIBOR during the quarter
accounted for a negative 25 basis point effect on the
yield
- Net asset value (“NAV”) per share decreased by 5.66% to
$10.51, compared to $11.14 as of March 31, 2019
- Effective August 30, 2019, Investcorp Credit Management
US LLC (“Investcorp”) became the majority owner of the Company’s
investment adviser, CM Investment Partners LLC (the “Adviser”), and
the Company entered into a new investment advisory agreement with
the Adviser (the “New Advisory Agreement”)
Portfolio
results, as of June 30, 2019: |
|
Total assets |
$336.9mm |
Investment portfolio, at fair value |
$306.4mm |
Net assets |
$143.1mm |
Weighted average yield on debt investments, at cost |
10.50% |
Net asset value per share |
$10.51 |
Portfolio activity in the current quarter: |
|
Number of new investments |
11 |
Total capital invested |
$32.2mm |
Proceeds from repayments, sales, and amortization |
$17.2mm |
Number of portfolio companies, end of period |
33 |
Net investment income (NII) |
$3.0mm |
Net investment income per share |
$0.22 |
Net decrease in net assets from operations |
$5.2mm |
Net decrease in net assets from operations per share |
$0.38 |
Quarterly per share distribution paid on July 5, 2019 |
$0.25 |
Mr. Michael C. Mauer, the Company’s Chief
Executive Officer, said “We are very excited to begin the next
stage of our growth as a company, as we join our new partners at
Investcorp. As part of a robust credit platform, we anticipate
leveraging Investcorp’s resources to accelerate the pace at which
we diversify our portfolio into new middle market lending
relationships. We remain focused on providing first lien and senior
secured debt in our borrowers’ capital structures, and we believe
there are attractive opportunities in club and direct lending to
earn better risk-adjusted returns than the broader market. The fair
value of the portfolio declined during the quarter, largely due to
specific markdowns in three of our portfolio companies.”
On August 28, 2019, the Company’s Board of Directors (the
“Board”) declared a distribution for the quarter ending September
30, 2019 of $0.25 per share, payable on October 16, 2019, to
shareholders of record as of September 26, 2019. This represents a
14.35% yield on the Company’s $6.97 share price as of market close
on September 9, 2019. Distributions may include net
investment income, capital gains and/or return of capital, however,
the Company does not expect the distribution to be comprised of a
return of capital. The tax status of distributions will be
determined at the end of the taxable year.
Portfolio and Investment
Activities
During the quarter, the Company made investments
in six portfolio companies, and funded one revolver and one delayed
draw commitment. The aggregate capital invested during the quarter
totaled $32.2mm at cost, and investments were made at a weighted
average yield of 11.47%. Three new portfolio companies were
added in the quarter.
The Company also realized $17.2mm of repayments,
sales, and amortization, including sales of Exela Intermedia LLC
(Bond), Nexeo Plastics (Bond), and Zinc Acquisition Holdings, LP
(Equity Interest), as well as the sale of a portion of the
Company’s position in FPC Holdings, Inc. and Specialty Building
Products Holdings LLC. Realized and unrealized gains and losses
accounted for a decrease in the Company’s net investments of
approximately $8.2mm, or $0.60 per share. The total net
decrease in net assets resulting from operations for the quarter
was $5.2mm, or $0.38 per share.
As of June 30, 2019, the Company’s investment
portfolio consisted of investments in 33 portfolio companies, of
which 77.6% were first lien investments, 18.7% were second lien
investments, and 3.7% were unitranche loans. The Company’s debt
portfolio consisted of 96.8% floating rate investments and 3.2%
fixed rate investments.
As of June 30, 2019, the Company had one
investment on non-accrual status, Fusion Connect Inc.
Capital Resources
As of June 30, 2019, the Company had $19.7mm in cash, $6.6mm in
restricted cash and $19.0mm of capacity under its revolving credit
facility with UBS AG, London Branch.
Investcorp Transaction
As previously announced, on June 26, 2019,
Investcorp entered into a definitive agreement to acquire a
majority ownership interest in the Adviser through its purchase of
the respective equity positions held by certain funds managed by
Cyrus Capital Partners, L.P. and Stifel Venture Corp., and newly
issued interests in the Adviser (the “Transaction”). The
consummation of the Transaction on August 30, 2019 resulted in a
change in control of the Adviser and, as a result, an assignment
and subsequent termination of the investment advisory agreement,
dated February 5, 2014, between the Company and the Adviser
(the “Prior Advisory Agreement”) in accordance with the Investment
Company Act of 1940, as amended (the “Investment Company Act”).
New Advisory Agreement
At an in-person meeting held on June 26, 2019,
the Board, including all of the independent directors, unanimously
approved the New Advisory Agreement and recommended that the New
Advisory Agreement be submitted to the Company’s stockholders for
approval at the special meeting of stockholders (the “Special
Meeting”) on August 28, 2019. At the Special Meeting held on
August 28, 2019, the Company’s stockholders approved the New
Advisory Agreement. In connection with the closing of the
Transaction on August 30, 2019 (the “Closing”), the Company entered
into the New Advisory Agreement and a new administration agreement
with the Adviser (the “New Administration Agreement”). The
terms of the New Advisory Agreement and the New Administration
Agreement are substantially the same as those contained in the
Prior Advisory Agreement and the prior administration
agreement.
Entrance into Stock Purchase Agreement
In connection with the Transaction, on June 26,
2019, the Company entered into a stock purchase and transaction
agreement with Investcorp BDC Holdings Limited (“Investcorp BDC”),
an affiliate of Investcorp (the “Stock Purchase Agreement”).
The Stock Purchase Agreement provides that, among other things,
following the Closing and prior to the second anniversary of the
date of the Closing, Investcorp BDC will purchase 680,985 newly
issued shares of the Company’s common stock, at the most recently
determined net asset value per share of the Company’s common stock
at the time of such purchase, as adjusted as necessary to comply
with Section 23 of the Investment Company Act. In addition,
Investcorp BDC will purchase 680,985 shares of the Company’s common
stock in open-market or secondary transactions over
a two-year period following the Closing. Investcorp
BDC did not purchase any shares of the Company’s common stock at
the Closing.
Recent Developments
Subsequent to June 30, 2019 and through
September 9, 2019, we invested $19.6 million in new and existing
portfolio companies and received sales proceeds of $15.2 million.
As of September 9, 2019, the Company had 34 portfolio
companies.
On August 28, 2019, the Board elected Thomas Sullivan as a
director of the Company, effective as of September 15,
2019. On August 28, 2019, the Company entered into the
Letter Agreement with Investcorp (the “Waiver Agreement”) amending
certain terms of the Stock Purchase Agreement. In accordance with
the Waiver Agreement, Investcorp has the right to identify a second
director candidate (the “Post-Closing Designated Director”) prior
to March 31, 2020; provided that if by March 31, 2020 the
Post-Closing Designated Director has not been elected to the Board
and the nominating and corporate governance committee of the Board
(the “Nominating Committee”) has rejected one or more proposed
Post-Closing Designated Directors, then such date will be extended
for such period of time as necessary for Investcorp to propose a
qualified Post-Closing Designated Director, but in any event not
beyond August 30, 2020, (ii) Robert Ryder and Robert Wagner have
submitted their resignations from the Board, each to be effective
as of September 15, 2019, (iii) Keith Lee has delivered a letter to
the Chairman of the Board indicating that, in light of the Stock
Purchase Agreement and the Transaction, he intends to resign as a
member of the Board upon the recommendation by the Nominating
Committee to the Board to appoint the Post-Closing Designated
Director and the appointment by the Board of the Post-Closing
Designated Director to the Board, and (iv) the Board has approved a
reduction in its size to four members, effective as of September
15, 2019.
In addition, on August 28, 2019, the Board appointed Mr. Lee as
chair of the Audit Committee and Julie Persily as chair of the
Valuation Committee, each to be effective as of September 15,
2019.
On August 28, 2019, the Board declared a distribution for the
quarter ended June 30, 2019 of $0.25 per share payable on October
16, 2019 to stockholders of record as of September 26, 2019.
As noted above, on August 30, 2019, the Company entered into the
New Advisory Agreement and the New Administration Agreement. In
addition, on August 30, 2019, the Company changed its name to
Investcorp Credit Management BDC, Inc. and, effective September 3,
2019, the trading symbol on the NASDAQ Global Select Market for
shares of the Company’s common stock changed from “CMFN” to
“ICMB”.
On August 30, 2019, in connection with the Closing, Christopher
Jansen resigned from the Board.
|
Investcorp Credit Management BDC, Inc. and
Subsidiaries |
|
|
|
|
|
|
|
|
|
|
Consolidated Statements of Assets and
Liabilities |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
June 30, 2019 |
|
|
June 30, 2018 |
|
Assets |
|
|
|
|
|
|
|
Non-controlled,
non-affiliated investments, at fair value (amortized cost of |
$ |
306,390,993 |
|
|
$ |
293,592,013 |
|
|
|
$321,504,359 and $
302,647,282, respectively) |
|
|
|
|
|
|
Derivatives, at
fair value (cost of $0 and $0, respectively) |
|
- |
|
|
|
229,918 |
|
|
Cash |
|
|
|
19,706,281 |
|
|
|
5,620,441 |
|
|
Cash,
restricted |
|
6,589,901 |
|
|
|
2,706,273 |
|
|
Receivable for
investments sold |
|
820,332 |
|
|
|
7,751,875 |
|
|
Interest
receivable |
|
3,090,639 |
|
|
|
4,011,450 |
|
|
Deferred offering
costs |
|
121,922 |
|
|
|
121,922 |
|
|
Other
receivables |
|
- |
|
|
|
245,550 |
|
|
Prepaid expenses
and other assets |
|
227,924 |
|
|
|
255,139 |
|
|
|
Total
Assets |
$ |
336,947,992 |
|
|
$ |
314,534,581 |
|
|
|
|
|
|
|
|
|
|
|
Liabilities |
|
|
|
|
|
|
|
Notes
payable: |
|
|
|
|
|
|
|
Term loan |
$ |
122,000,000 |
|
|
$ |
102,000,000 |
|
|
|
Revolving credit
facility |
|
11,026,670 |
|
|
|
17,823,000 |
|
|
|
2023 Notes
payable |
|
34,500,000 |
|
|
|
- |
|
|
|
Deferred debt
issuance costs |
|
(2,000,262 |
) |
|
|
(1,953,771 |
) |
|
|
|
Notes payable, net |
|
165,526,408 |
|
|
|
117,869,229 |
|
|
Payable for
investments purchased |
|
22,276,343 |
|
|
|
12,569,450 |
|
|
Dividend
payable |
|
3,404,923 |
|
|
|
3,417,848 |
|
|
Deferred financing
costs payable |
|
1,037,000 |
|
|
|
2,071,167 |
|
|
Income-based
incentive fees payable |
|
545,991 |
|
|
|
2,294,678 |
|
|
Base management
fees payable |
|
- |
|
|
|
1,319,853 |
|
|
Accrued provision
for taxes |
|
13,778 |
|
|
|
2,579,337 |
|
|
Derivatives, at
fair value (cost $0 and $0, respectively) |
|
- |
|
|
|
229,918 |
|
|
Interest
payable |
|
724,222 |
|
|
|
303,153 |
|
|
Directors' fees
payable |
|
95,240 |
|
|
|
99,296 |
|
|
Accrued expenses
and other liabilities |
|
240,197 |
|
|
|
257,986 |
|
|
|
Total
Liabilities |
|
193,864,102 |
|
|
|
143,011,915 |
|
|
|
|
|
|
|
|
|
|
|
Commitments and Contingencies (Note 6) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
Assets |
|
|
|
|
|
|
|
Common stock, par
value $0.001 per share (100,000,000 shares authorized, |
|
|
|
|
|
|
|
13,619,690 and
13,649,504 shares issued and outstanding, respectively) |
|
13,620 |
|
|
|
13,649 |
|
|
Additional paid-in
capital |
|
198,398,831 |
|
|
|
198,700,999 |
|
|
Distributable
earnings (loss) |
|
(55,328,561 |
) |
|
|
(27,191,982 |
) |
|
|
Total Net
Assets |
|
143,083,890 |
|
|
|
171,522,666 |
|
|
|
Total
Liabilities and Net Assets |
$ |
336,947,992 |
|
|
$ |
314,534,581 |
|
|
Net Asset Value
Per Share |
$ |
10.51 |
|
|
$ |
12.57 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
See notes to consolidated financial statements. |
|
Investcorp Credit Management BDC, Inc. and
Subsidiaries |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Consolidated Statements of Operations |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For the Twelve months ended June 30, |
|
|
|
|
|
2019 |
|
|
2018 |
|
|
2017 |
|
|
Investment
Income: |
|
|
|
|
|
|
|
|
|
|
|
Interest
income |
|
|
$ |
32,591,488 |
|
|
$ |
28,691,187 |
|
|
$ |
29,476,315 |
|
|
Payment in-kind
interest income |
|
|
953,928 |
|
|
|
2,609,037 |
|
|
|
423,632 |
|
|
Dividend
income |
|
|
|
133,858 |
|
|
|
9,005,887 |
|
|
|
- |
|
|
Payment in-kind
dividend income |
|
|
- |
|
|
|
333,333 |
|
|
|
- |
|
|
Other fee
income |
|
|
|
718,548 |
|
|
|
152,308 |
|
|
|
1,112,250 |
|
|
Total investment income |
|
|
|
34,397,822 |
|
|
|
40,791,752 |
|
|
|
31,012,197 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Expenses: |
|
|
|
|
|
|
|
|
|
|
|
Interest
expense |
|
|
|
8,866,796 |
|
|
|
6,310,842 |
|
|
|
4,748,449 |
|
|
Base management
fees |
|
|
|
5,436,135 |
|
|
|
4,871,706 |
|
|
|
4,652,064 |
|
|
Income-based
incentive fees |
|
|
|
1,720,707 |
|
|
|
3,932,710 |
|
|
|
1,289,927 |
|
|
Provision for tax
expense |
|
|
|
158,028 |
|
|
|
2,579,337 |
|
|
|
- |
|
|
Professional
fees |
|
|
|
1,130,816 |
|
|
|
1,063,528 |
|
|
|
806,810 |
|
|
Allocation of
administrative costs from advisor |
|
|
1,354,247 |
|
|
|
1,198,397 |
|
|
|
987,286 |
|
|
Amortization of
deferred debt issuance costs |
|
|
781,508 |
|
|
|
695,470 |
|
|
|
932,417 |
|
|
Insurance
expense |
|
|
|
336,629 |
|
|
|
351,923 |
|
|
|
345,697 |
|
|
Directors'
fees |
|
|
|
405,000 |
|
|
|
402,240 |
|
|
|
501,233 |
|
|
Custodian and
administrator fees |
|
|
285,799 |
|
|
|
295,032 |
|
|
|
480,269 |
|
|
Offering
expense |
|
|
|
207,000 |
|
|
|
186,513 |
|
|
|
- |
|
|
Other
expenses |
|
|
|
719,547 |
|
|
|
455,645 |
|
|
|
818,532 |
|
|
Total expenses |
|
|
|
|
21,402,212 |
|
|
|
22,343,343 |
|
|
|
15,562,684 |
|
|
Waiver of
income-based incentive fees |
|
|
(503,229 |
) |
|
|
(527,224 |
) |
|
|
(249,071 |
) |
|
Net expenses |
|
|
|
|
20,898,983 |
|
|
|
21,816,119 |
|
|
|
15,313,613 |
|
|
Net investment income |
|
|
|
13,498,839 |
|
|
|
18,975,633 |
|
|
|
15,698,584 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net realized and
unrealized gain/(loss) on investments: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net realized gain
(loss) from investments |
|
|
(21,982,973 |
) |
|
|
(9,855,453 |
) |
|
|
(11,809,335 |
) |
|
Net change in
unrealized appreciation (depreciation) in value |
|
|
|
|
|
|
|
|
|
|
of investments |
|
|
|
|
(6,058,095 |
) |
|
|
6,505,300 |
|
|
|
19,690,216 |
|
|
Total realized and unrealized gain (loss) on
investments |
|
|
|
(28,041,068 |
) |
|
|
(3,350,153 |
) |
|
|
7,880,881 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net increase (decrease) in net
assets resulting from operations |
|
|
|
$ |
(14,542,229 |
) |
|
$ |
15,625,480 |
|
|
$ |
23,579,465 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic and
diluted: |
|
|
|
|
|
|
|
|
|
|
|
Net investment income per share |
|
|
$ |
0.99 |
|
|
$ |
1.39 |
|
|
$ |
1.15 |
|
|
Earnings per share |
|
|
|
$ |
(1.07 |
) |
|
$ |
1.14 |
|
|
$ |
1.72 |
|
|
Weighted average shares of common stock outstanding |
|
|
|
13,630,661 |
|
|
|
13,689,823 |
|
|
|
13,686,288 |
|
|
Distributions paid per common share |
|
$ |
1.00 |
|
|
$ |
1.00 |
|
|
$ |
1.20 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
See notes to consolidated financial statements. |
|
|
|
|
|
|
|
|
|
|
|
|
|
About Investcorp Credit Management BDC,
Inc.
The Company is an externally-managed, closed-end,
non-diversified management investment company that has elected to
be regulated as a business development company under the Investment
Company Act of 1940. The Company’s investment objective is to
maximize the total return to its stockholders in the form of
current income and capital appreciation through debt and related
equity investments by targeting investment opportunities with
favorable risk-adjusted returns. The Company seeks to invest
primarily in middle-market companies that have annual revenues of
at least $50mm and earnings before interest, taxes, depreciation
and amortization of at least $15mm. The Company’s investment
activities are managed by its investment adviser, CM Investment
Partners LLC. To learn more about Investcorp Credit Management BDC,
Inc., please visit www.icmbdc.com.
Forward-Looking Statements
Statements included herein may contain
“forward-looking statements,” which relate to future performance or
financial condition. 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 assumptions, risks and uncertainties, which
change over time. Actual results may differ materially from those
anticipated in any forward-looking statements as a result of a
number of factors, including those described from time to time in
filings by the Company with the Securities and Exchange Commission.
The Company undertakes no duty to update any forward-looking
statement made herein except as required by law. All
forward-looking statements speak only as of the date of this press
release.
ContactsInvestcorp Credit Management BDC, Inc.
Investor Relations Email:
icmbinvestorrelations@investcorp.comPhone: 212-257-5199
CM Financial (NASDAQ:CMFN)
과거 데이터 주식 차트
부터 5월(5) 2024 으로 6월(6) 2024
CM Financial (NASDAQ:CMFN)
과거 데이터 주식 차트
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