CHICAGO, Dec. 13, 2010 /PRNewswire-FirstCall/ -- Golub
Capital BDC, Inc., a business development company (Nasdaq: GBDC),
today announced its financial results for the fourth quarter and
fiscal year ended September 30, 2010.
Except where the context suggests otherwise, the terms
"we," "us," "our," and "Company," refer to Golub Capital BDC, Inc.
and its Subsidiaries. "GC Advisors" refers to GC Advisors,
LLC, our investment advisor.
|
SELECTED FINANCIAL
HIGHLIGHTS
|
|
|
|
|
|
|
|
|
|
|
(in millions, expect per share
data)
|
|
|
|
|
|
|
|
|
|
|
September
30, 2010
|
|
|
|
|
Investment portfolio
|
$
344,869
|
|
|
|
|
Total assets
|
$
442,763
|
|
|
|
|
NAV per share
|
$
14.71
|
|
|
|
|
|
|
|
|
|
Quarter
Ended September 30, 2010
|
Year Ended
September 30, 2010
|
|
|
|
Investment income
|
$
7,431
|
$
33,150
|
|
|
|
Net investment income
|
$
4,351
|
$
23,367
|
|
|
|
Net realized and unrealized
gain
|
$
1,896
|
$
26,248
|
|
|
|
Net income
|
$
6,247
|
$
26,248
|
|
|
|
Net income per share
|
$
0.35
|
N/A
|
(1)
|
|
|
Net investment income per
share
|
$
0.25
|
N/A
|
(1)
|
|
|
|
|
|
|
|
(1) - For historical periods
that include financial results prior to April 1, 2010, the Company
did not
|
|
|
have common shares outstanding
or an equivalent and therefore earnings per share for
periods
|
|
|
that include financial results
prior to April 1, 2010 are not provided.
|
|
|
|
|
|
|
Portfolio and Investment Activities
At September 30, 2010, the Company
had investments in 94 portfolio companies, with a total fair value
of $344.9 million. The
portfolio consisted of $227.1 million
of senior secured loans, $90.4
million of unitranche loans, $11.4
million of second lien loans, $13.4
million of subordinated debt and $2.6
million of common equity investments. For the three
months ended September 30, 2010, the
Company originated $83.7 million in
new investment commitments. Of the $83.7 million in new investment commitments, 59%
were senior secured loans, 27% were unitranche loans, 11% were
subordinated loans and 3% were equity securities. Sales and
repayments on investments for the same period totaled $13.5 million. The Company expects to continue to
invest in a mix of mezzanine and senior secured loans to obtain a
high level of current income and to preserve capital.
For the quarter ended September 30,
2010, the weighted average annualized interest income yield
(which excludes income resulting from amortization of fees and
discounts) and weighted average annualized investment income yield
(which includes interest income and amortization of fees and
discounts) on the fair value of investments in the Company's
portfolio was 8.1% and 9.8%, respectively. As of
September 30, 2010, 59.2% of the
Company's portfolio at fair value had interest rate floors that
limit minimum interest rates on such loans.
Consolidated Results of Operations
Total investment income for the three months ended September 30, 2010 and June 30, 2010 was $7.4
million and $7.2 million,
respectively. Investment income increased by $0.2 million, or 2.8%, for the three months ended
September 30, 2010 as compared to the
three months ended June 30, 2010.
This increase was primarily attributable to higher average invested
assets during the three months ended September 30, 2010.
Total expenses for the three months ended September 30, 2010 and June 30, 2010 were $3.1
million and $2.4 million,
respectively. Total expenses increased by $0.7 million, or 29.2%, for the three months
ended September 30, 2010 as compared
to the three months ended June 30,
2010. This increase was primarily due to an increase in
interest expense as a result of higher debt outstanding and higher
interest rates on our outstanding debt.
Total expenses for the year ended September 30, 2010 and September 30, 2009 were $9.8 million and $7.9
million, respectively. Total expenses increased by
$1.9 million, or 24.5%, for the year
ended September 30, 2010 as compared
to the year ended September 30, 2009.
This increase was primarily due to non-recurring
organizational costs associated with our initial public offering,
as well as an increase in professional fees, management fees, and
administrative service fees. These increases were partially
offset by a decrease in interest and other credit facility
expenses.
During the three months ended September
30, 2010 and June 30, 2010,
the Company had $(40,000) and $0 of
net realized losses on investments, respectively. During the
three months ended September 30, 2010
and June 30, 2010, the Company
recorded net unrealized appreciation of $1.9
million and net unrealized depreciation of $(0.1)
million, respectively.
During the years ended September 30,
2010 and September 30, 2009,
the Company had $(40,000) and
$(4.0) million of net realized losses
on investments, respectively. During the years ended
September 30, 2010 and September 30, 2009, the Company recorded net
unrealized appreciation of $2.9
million and net unrealized depreciation of $(1.5) million, respectively.
"I am pleased to report that we had a solid 9/30/10 quarter and that we continue to see
strong momentum in new originations. Based on new deals already
completed and our current pipeline, we expect new originated
investments for the 12/31/2010
quarter will exceed originations in the 9/30/2010 quarter," said Golub Capital BDC, Inc.
CEO David Golub.
Liquidity and Capital Resources
As of September 30, 2010, the
Company had cash and cash equivalents of $61.2 million, restricted cash of $31.8 million and $174.0
million of total debt outstanding.
Through our wholly owned subsidiary, GC SBIC IV, L.P., the
Company may obtain leverage by issuing SBA-guaranteed debentures,
subject to issuance of a capital commitment by the SBA and
customary procedures. See recent developments below for information
pertaining to commitments available under the SBA debenture
program.
On December 8, 2010, the Company's
board of directors declared a quarterly dividend of $0.31 per share payable on December 30, 2010 to holders of record as of
December 20, 2010.
Portfolio and Asset Quality
GC Advisors regularly assesses the risk profile of each of the
Company's investments and rates each of them based on the following
categories:
|
Risk Ratings
Definition
|
|
|
Rating
|
|
Definition
|
|
|
5
|
|
Involves the least amount of
risk in our portfolio. The borrower is performing above
expectations and the trends and risk factors are generally
favorable.
|
|
|
4
|
|
Involves an acceptable level of
risk that is similar to the risk at the time of origination. The
borrower is generally performing as expected and the risk factors
are neutral to favorable.
|
|
|
3
|
|
Involves a borrower performing
below expectations and indicates that the loan's risk has increased
somewhat since origination. The borrower may be out of compliance
with debt covenants; however; loan payments are generally not past
due.
|
|
|
2
|
|
Involves a borrower performing
materially below expectations and indicates that the loan's risk
has increased materially since origination. In addition to the
borrower being generally out of compliance with debt covenants,
loan payments may be past due (but generally not more than 180 days
past due). For loans graded 2, we will implement a plan to increase
monitoring of the borrower.
|
|
|
1
|
|
Indicates that the borrower is
performing substantially below expectations and the loan risk has
substantially increased since origination. Most or all of the debt
covenants are out of compliance and payments are substantially
delinquent. Loans graded 1 are not anticipated to be repaid in full
and we will reduce the fair market value of the loan to the amount
we anticipate will be recovered.
|
|
|
|
|
|
|
The following table shows the distribution of our investments on
the 1 to 5 investment performance rating scale at fair value as of
September 30, 2010 and June 30, 2010:
|
|
|
September
30, 2010
|
|
June 30,
2010
|
|
|
Investment
|
|
Investments
|
|
Percentage
of
|
|
Investments
|
|
Percentage
of
|
|
|
Performance
|
|
at Fair
Value
|
|
Total
|
|
at Fair
Value
|
|
Total
|
|
|
Rating
|
|
(In
thousands)
|
|
Investments
|
|
(In
thousands)
|
|
Investments
|
|
|
5
|
|
$
98,307
|
|
28.5%
|
|
91,915
|
|
33.1%
|
|
|
4
|
|
199,876
|
|
58.0%
|
|
128,874
|
|
46.4%
|
|
|
3
|
|
41,948
|
|
12.2%
|
|
54,769
|
|
19.7%
|
|
|
2
|
|
4,738
|
|
1.4%
|
|
2,052
|
|
0.7%
|
|
|
1
|
|
-
|
|
0.0%
|
|
-
|
|
0.0%
|
|
|
Total
|
|
$
344,869
|
|
100.0%
|
|
$
277,610
|
|
100.0%
|
|
|
|
|
|
|
|
|
|
|
|
Recent Developments
On October 8, 2010, GC SBIC IV,
L.P. received a $22 million debt
commitment from the SBA. The commitment may be drawn upon
subject to customary SBA procedures. Through December 10, 2010, the Company had drawn
$10 million of the commitment.
The company also announced today the promotion of Ross A. Teune as Chief Financial Officer.
Mr. Teune joined an affiliate of our investment advisor in
November 2007 and, prior to being
elected our Chief Financial Officer, served as Senior Vice
President of Finance for an affiliate of our investment advisor,
where he had responsibility for the financial reporting for its
private debt funds managed. Prior thereto, Mr. Teune was Vice
President of Finance at Antares Capital Corporation, where he was
responsible for overseeing operations and financial reporting.
Mr. Teune also served as the primary liaison to the tax,
treasury, external reporting and market risk departments of
Massachusetts Life Insurance Company, Antares Capital's parent
company. Mr. Teune also worked at Heller Financial
Corporation and KPMG LLP.
Sean K. Coleman, who is stepping
down as Chief Financial Officer, will continue as a Managing
Director of our investment advisor, focusing on origination and
underwriting of new investments. Golub Capital BDC, Inc. CEO
David Golub said, "We are excited to
bring Ross A. Teune's enormous
talents to the Company. We thank Sean for his extraordinary efforts
in connection with the initial public offering and the Company's
early success."
Conference Call
The Company will host an earnings conference call at
1:00 p.m. (Eastern Time) on
Monday, December 13, 2010. All
interested parties may participate in the conference call by
dialing (800) 891-3448 approximately 15 minutes prior to the call;
international callers should dial (212) 231-2921. Participants
should reference Golub Capital BDC, Inc. when prompted. For a slide
presentation that we intend to refer to on the earnings conference
call, please visit the Events and Presentations link on the
homepage of our website (www.golubcapitalbdc.com) and click on the
Investor Presentations link to find the 9/30/10 Investor Presentation. An archived replay
of the call will be available shortly after the call until
3:00 p.m. (Eastern Time) on
December 27, 2010. To hear the
replay, please dial (800) 633-8284. International dialers, please
dial (402) 977-9140. For all replays, please reference program ID
number 21489419.
|
Golub Capital BDC, Inc. and
Subsidiaries
Consolidated Statements of
Financial Condition
(In thousands, except share and
per share data)
|
|
|
September
30,
|
June
30,
|
September
30,
|
|
|
2010
|
2010
|
2009
|
|
|
|
(unaudited)
|
|
|
|
Assets
|
|
|
|
|
|
Investments, at fair value (cost
of $345,536, $280,214, and $387,293 respectively)
|
$
344,869
|
$
277,610
|
$
376,294
|
|
|
Cash and cash
equivalents
|
61,219
|
71,380
|
-
|
|
|
Restricted cash and cash
equivalents
|
31,771
|
32,728
|
30,614
|
|
|
Interest receivable
|
1,956
|
1,746
|
2,198
|
|
|
Other assets
|
2,948
|
296
|
16
|
|
|
Total Assets
|
$
442,763
|
$
383,760
|
$
409,122
|
|
|
|
|
|
|
|
Liabilities
|
|
|
|
|
|
Debt
|
$
174,000
|
$
121,764
|
$
315,306
|
|
|
Payable for investments
purchased
|
5,328
|
885
|
-
|
|
|
Accounts payable and accrued
expenses
|
719
|
647
|
685
|
|
|
Management and incentive fee
payable
|
1,008
|
593
|
249
|
|
|
Interest payable
|
1,167
|
86
|
130
|
|
|
Total Liabilities
|
182,222
|
123,975
|
316,370
|
|
|
|
|
|
|
|
Net Assets
|
|
|
|
|
|
Members' equity
|
$
-
|
$
-
|
92,752
|
|
|
Preferred stock, par value
$0.001 per share, 1,000,000 shares authorized,
|
|
|
|
|
|
zero shares issued
and outstanding as of September 30, 2010
|
-
|
-
|
-
|
|
|
Common stock, par value $0.001
per share, 100,000,000 shares authorized,
|
|
|
|
|
|
17,712,444 shares issued
and outstanding as of September 30, 2010
|
18
|
18
|
-
|
|
|
Paid in capital in excess of
par
|
259,690
|
259,690
|
-
|
|
|
Undistributed net investment
income
|
(1,122)
|
19
|
-
|
|
|
Net unrealized appreciation on
investments
|
1,995
|
58
|
-
|
|
|
Net realized losses on
investments
|
(40)
|
-
|
-
|
|
|
Total Net Assets
|
260,541
|
259,785
|
92,752
|
|
|
|
|
|
|
|
Total Liabilities and Total Net
Assets
|
$
442,763
|
$
383,760
|
$
409,122
|
|
|
|
|
|
|
|
Number of shares
outstanding
|
17,712,444
|
17,712,444
|
N/A
|
|
|
Net Asset Value Per
Share
|
$
14.71
|
$
14.67
|
N/A
|
|
|
|
|
|
|
Golub Capital BDC, Inc. and
Subsidiaries
|
|
|
|
Consolidated Statements of
Operations
|
|
|
|
(In thousands, except share and
per share data)
|
|
|
|
Three months
ended
|
|
Years ended
September 30,
|
|
|
September
30, 2010
|
June 30,
2010
|
|
2010
|
2009
|
|
|
(Unaudited)
|
|
|
|
|
Investment income
|
|
|
|
|
|
|
|
Interest
|
$
7,431
|
$
7,230
|
|
$
33,150
|
$
33,338
|
|
|
|
|
|
|
|
|
|
Total
investment income
|
7,431
|
7,230
|
|
33,150
|
33,338
|
|
|
|
|
|
|
|
|
|
Expenses
|
|
|
|
|
|
|
|
Interest and other debt
financing expenses
|
1,381
|
591
|
|
3,525
|
4,547
|
|
|
Base management
fee
|
1,091
|
903
|
|
3,328
|
2,849
|
|
|
Incentive fee
|
-
|
55
|
|
55
|
-
|
|
|
Professional fees relating
to registration statement
|
-
|
188
|
|
788
|
-
|
|
|
Professional
fees
|
315
|
363
|
|
1,050
|
131
|
|
|
Administrative service
fee
|
141
|
144
|
|
583
|
-
|
|
|
General and administrative
expenses
|
152
|
171
|
|
454
|
333
|
|
|
|
|
|
|
|
|
|
Total
expenses
|
3,080
|
2,415
|
|
9,783
|
7,860
|
|
|
|
|
|
|
|
|
|
Net
investment income
|
4,351
|
4,815
|
|
23,367
|
25,478
|
|
|
|
|
|
|
|
|
|
Net gain (loss) on
investments
|
|
|
|
|
|
|
|
Net realized loss on
investments
|
(40)
|
-
|
|
(40)
|
(3,972)
|
|
|
Net change in unrealized
appreciation (depreciation) on investments
|
1,936
|
(100)
|
|
2,921
|
(1,489)
|
|
|
|
|
|
|
|
|
|
Net gain (loss) on
investments
|
1,896
|
(100)
|
|
2,881
|
(5,461)
|
|
|
|
|
|
|
|
|
|
Net increase
in net assets resulting from operations
|
$
6,247
|
$
4,715
|
|
$
26,248
|
$
20,017
|
|
|
|
|
|
|
|
|
|
Basic and diluted earnings per
share(1)
|
$
0.35
|
$
0.29
|
|
N/A
|
N/A
|
|
|
|
|
|
|
|
|
|
Basic and diluted weighted
average shares outstanding
|
17,712,444
|
16,255,783
|
|
N/A
|
N/A
|
|
|
___________________
|
|
|
|
|
|
|
|
1 - For historical periods that
include financial results prior to April 1, 2010, the Company did
not have common shares outstanding or an
equivalent and therefore earnings per share and weighted
average shares outstanding information for periods that include
financial results prior to April 1, 2010 are not
provided.
|
|
|
|
|
|
|
|
ABOUT GOLUB CAPITAL BDC, INC.
Golub Capital BDC, Inc., (NASDAQ: GBDC,
www.golubcapitalbdc.com), a business development company,
principally invests in senior secured, unitranche, mezzanine and
second lien loans of middle-market companies that are, in most
cases, sponsored by private equity investors. Golub Capital BDC,
Inc.'s investment activities are managed by its investment adviser,
GC Advisors LLC, an affiliate of the Golub Capital group of
companies ("Golub Capital").
ABOUT GOLUB CAPITAL
Golub Capital, founded in 1994, is a leading lender to
middle-market companies. In 2009, Golub Capital was named "Middle
Market Lender of the Year" by Buyouts Magazine and "Debt Financing
Agent of the Year" and "Mezzanine Financing Agent of the Year" by
M&A Advisor. As of September 30,
2010, Golub Capital managed over $4.0
billion of capital, with a team of investment professionals
in New York, Chicago and Atlanta.
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 from time
to time in the Company's filings with the Securities and Exchange
Commission. 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.
SOURCE Golub Capital BDC, Inc.