Golub Capital BDC, Inc. Declares First Fiscal Quarter of 2013
Distribution of $0.32 Per Share and Announces Fourth Fiscal Quarter
and Fiscal Year Ended September 30, 2012 Financial Results
CHICAGO, Nov. 29, 2012 /PRNewswire/ -- Golub Capital
BDC, Inc., a business development company (NASDAQ: GBDC), today
announced its financial results for the fourth fiscal quarter and
fiscal year ended September 30,
2012.
Except where the context suggests otherwise, the terms
"we," "us," "our," and "Company" refer to Golub Capital BDC, Inc.
and its consolidated subsidiaries. "GC Advisors" refers to GC
Advisors LLC, our investment adviser.
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SELECTED FINANCIAL HIGHLIGHTS
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(in
thousands, expect per share data)
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September
30, 2012
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June 30,
2012
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September
30, 2011
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Investment
portfolio
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$
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672,910
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$
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636,632
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$
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459,827
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Total
assets
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$
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734,096
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$
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711,522
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$
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559,644
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Net asset
value per share
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$
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14.60
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$
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14.58
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$
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14.56
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Quarter
Ended
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Year
Ended
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September
30, 2012
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June 30,
2012
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September
30, 2012
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Investment
income
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$
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16,219
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$
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14,811
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$
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57,859
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Net
investment income
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$
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7,791
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$
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6,678
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$
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27,876
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Net gain
(loss) on investments and derivative instruments
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$
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954
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$
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(1,285)
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$
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3,884
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Net
increase in net assets resulting from operations
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$
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8,745
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$
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5,393
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$
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31,760
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Net
investment income per share
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$
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0.30
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$
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0.26
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$
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1.15
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Net gain
(loss) on investments and derivative instruments per
share
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$
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0.04
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$
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(0.05)
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$
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0.16
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Net
earnings per share
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$
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0.34
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$
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0.21
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$
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1.31
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Fourth Fiscal Quarter 2012 Highlights
- Net investment income for the quarter ended September 30, 2012 was $7.8 million, or $0.30 per share, as compared to $6.7 million, or $0.26 per share, for the quarter ended
June 30, 2012;
- Net gain (loss) on investments and derivative instruments for
the quarter ended September 30, 2012
was $0.9 million, or $0.04 per share, as compared to $(1.3) million, or $(0.05) per share, for the quarter ended
June 30, 2012;
- Net increase in net assets resulting from operations for the
quarter ended September 30, 2012 was
$8.7 million, or $0.34 per share, as compared to $5.4 million, or $0.21 per share, for the quarter ended
June 30, 2012; and
- Our board of directors declared a quarterly distribution on
November 27, 2012 of $0.32 per share, payable on December 28, 2012 to stockholders of record as of
December 14, 2012.
Portfolio and Investment Activities
At September 30, 2012, the Company
had investments in 121 portfolio companies with a total fair value
of $672.9 million. The
investments in these portfolio companies consisted of $274.0 million of senior secured loans,
$265.7 million of one stop loans,
$44.4 million of second lien loans,
$67.4 million of subordinated debt
and $21.4 million of equity
investments. This compares to the Company's portfolio as of
June 30, 2012, at which the Company
had investments in 116 portfolio companies with a total fair value
of $636.6 million. The
investments in these portfolio companies consisted of $258.8 million of senior secured loans,
$236.8 million of one stop loans,
$48.4 million of second lien loans,
$74.6 million of subordinated debt
and $18.0 million of equity
investments.
For the quarter ended September 30,
2012, the Company originated $113.4
million in new middle-market investment commitments.
Approximately 63% of the new middle-market investment commitments
were one stop loans, 34% were senior secured loans and 3% were
equity securities. Sales and repayments on investments for the same
period totaled $70.9 million.
For the quarter ended September 30,
2012, the weighted average annualized investment income
yield (which includes interest income and amortization of fees and
discounts) and the weighted average annualized interest income
yield (which excludes income resulting from amortization of fees
and discounts) on the fair value of earning investments in the
Company's portfolio was 10.5% and 9.5%, respectively.
Consolidated Results of Operations
Total investment income for the three months ended September 30, 2012 and June 30, 2012 was $16.2
million and $14.8 million,
respectively. This $1.4 million
increase was primarily attributable to higher average invested
assets during the three months ended September 30, 2012.
Total expenses for the three months ended September 30, 2012 and June 30, 2012 were $8.4
million and $8.1 million,
respectively. This $0.3 million
increase was primarily due to an increase in interest expense as a
result of higher average debt outstanding and a higher effective
yield, increased incentive fees due to higher net investment income
and increased management fees due to higher average
assets.
During the three months ended September
30, 2012 and June 30, 2012,
the Company had $(0.6) million and
$1.2 million of net realized (losses)
gains on investments and derivative instruments,
respectively. The realized loss for the quarter ended
September 30, 2012 was primarily
related to the sale of an investment in one portfolio company and a
loss on the settlement of the Company's ten-year U.S. Treasury
futures contracts. During the three months ended September 30, 2012 and June 30, 2012, the Company recorded net
unrealized appreciation (depreciation) on investments and
derivative instruments of $1.5
million and $(2.4) million,
respectively. The unrealized appreciation for the three
months ended September 30, 2012 was
primarily a result of broad gains across several middle-market debt
and equity securities.
Liquidity and Capital Resources
The Company's liquidity and capital resources are derived from
the Company's debt securitization, Small Business Administration
("SBA") debentures, revolving credit facility and cash flow from
operations. The Company's primary uses of funds from
operations include investment in portfolio companies and payment of
fees and other expenses that the Company incurs. The Company
has used, and expects to continue to use, its debt securitization,
SBA debentures, revolving credit facility, proceeds from its
investment portfolio and proceeds from offerings of its securities
to finance its investment objectives.
As of September 30, 2012, the
Company had cash and cash equivalents of $13.9 million, restricted cash of $37.0 million and $352.3
million of total debt outstanding. As of
September 30, 2012, the Company had
$20.2 million available for
additional borrowings on its revolving credit facility, subject to
leverage and borrowing base restrictions.
On October 16, 2012, we priced a
public offering of 2,600,000 shares of our common stock at a public
offering price of $15.58 per share,
raising approximately $40.5 million
in gross proceeds. Wells Fargo Securities, LLC and UBS Securities
LLC acted as joint book-running managers for the offering. On
October 19, 2012, the transaction
closed, the shares were issued, and proceeds, net of offering costs
but before expenses, of $39.4 million
were received. On November 14,
2012, we sold an additional 294,120 shares pursuant to the
underwriters' partial exercise of the over-allotment option and we
received net proceeds, before expenses, of $4.4 million.
On November 27, 2012, the
Company's board of directors declared a quarterly distribution of
$0.32 per share payable on
December 28, 2012 to holders of
record as of December 14,
2012.
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:
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Risk
Ratings Definition
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Rating
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Definition
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5
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Involves
the least amount of risk in our portfolio. The borrower is
performing above expectations, and the trends and risk factors are
generally favorable.
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4
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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.
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3
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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.
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2
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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).
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1
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Involves a
borrower performing substantially below expectations and indicates
that the loan's risk has substantially increased since origination.
Most or all of the debt covenants are out of compliance and
payments are substantially delinquent. Loans rated 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.
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The following table shows the distribution of the Company's
investments on the 1 to 5 investment performance rating scale at
fair value as of September 30, 2012
and June 30, 2012:
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September 30, 2012
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June
30, 2012
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Investment
Performance
Rating
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Investments
at Fair
Value
(In
thousands)
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Percentage of
Total
Investments
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Investments
at Fair
Value
(In
thousands)
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Percentage of
Total
Investments
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5
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$
145,414
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21.6%
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$
138,479
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21.7%
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4
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468,182
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69.6
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437,319
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68.7
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3
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55,149
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8.2
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56,168
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8.8
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2
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340
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0.1
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341
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0.1
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1
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3,825
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0.5
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4,325
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0.7
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Total
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$
672,910
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100.0%
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$
636,632
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100.0%
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Conference Call
The Company will host an earnings conference call at
12:00 p.m. (Eastern Time) on
Thursday, November 29, 2012 to
discuss the quarterly financial results. All interested
parties may participate in the conference call by dialing (800)
736-4594 approximately 10-15 minutes prior to the call;
international callers should dial (212) 231-2912. 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
Quarter Ended 9.30.12 Investor
Presentation under Events and Presentations. An archived
replay of the call will be available shortly after the call until
2:00 p.m. (Eastern Time) on
December 24, 2012. To hear the
replay, please dial (800) 633-8284. International dialers, please
dial (402) 977-9140. For all replays, please reference program ID
number 21607887.
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Golub
Capital BDC, Inc. and Subsidiaries
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Consolidated Statements of Financial
Condition
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(In
thousands, except share and per share data)
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September 30, 2012
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June
30, 2012
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September 30, 2011
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Assets
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(unaudited)
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Investments, at fair value (cost of $669,841,
$635,252 and $462,961, respectively)
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$
672,910
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$
636,632
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$
459,827
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Cash and
cash equivalents
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13,891
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18,070
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46,350
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Restricted
cash and cash equivalents
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37,036
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45,059
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23,416
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Interest
receivable
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3,906
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3,893
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3,063
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Unrealized
appreciation on derivative instruments
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-
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149
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-
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Cash
collateral on deposit with custodian
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-
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1,287
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21,162
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Deferred
financing costs
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5,898
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6,082
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5,345
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Other
assets
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455
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350
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481
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Total
Assets
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$
734,096
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$
711,522
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$
559,644
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Liabilities
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Debt
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$
352,300
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$
329,800
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$
237,683
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Interest
payable
|
1,391
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2,269
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1,066
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Management
and incentive fees payable
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4,203
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4,070
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1,608
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Payable
for investments purchased
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-
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-
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1,986
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Accounts
payable and accrued expenses
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1,073
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1,172
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|
752
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Total
Liabilities
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358,967
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337,311
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243,095
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Net
Assets
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Preferred
stock, par value $0.001 per share, 1,000,000 shares
authorized,
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zero shares issued and outstanding
as of September 30, 2012, June 30, 2012 and
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September 30, 2011
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-
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-
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-
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Common
stock, par value $0.001 per share, 100,000,000 shares authorized,
25,688,101,
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25,663,009 and 21,733,903 shares
issued and outstanding as of September 30, 2012,
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June 30, 2012 and September 30,
2011, respectively
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26
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26
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22
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Paid in
capital in excess of par
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375,563
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376,292
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318,302
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Capital
distributions in excess of net investment income
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347
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(3,660)
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(398)
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Net
unrealized appreciation (depreciation) on investments and
derivative instruments
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5,737
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4,197
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(1,519)
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Net
realized (loss) gain on investments and derivative instruments, net
of dividends and distributions
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(6,544)
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(2,644)
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142
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Total
Net Assets
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375,129
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374,211
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|
316,549
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Total
Liabilities and Total Net Assets
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$
734,096
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$
711,522
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$
559,644
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Number of
common shares outstanding
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25,688,101
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25,663,009
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21,733,903
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Net asset
value per common share
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$
14.60
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$
14.58
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$
14.56
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Golub
Capital BDC, Inc. and Subsidiaries
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Consolidated Statements of
Operations
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(In
thousands, except share and per share data)
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Three
months ended
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Years
ended September 30,
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September 30, 2012
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June
30, 2012
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2012
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2011
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(unaudited)
|
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Investment income
|
|
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|
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Interest
income
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$
16,219
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$
14,811
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$
57,482
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$
39,150
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Dividend
income
|
|
-
|
|
-
|
|
377
|
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-
|
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|
|
|
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|
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Total
investment income
|
|
16,219
|
|
14,811
|
|
57,859
|
|
39,150
|
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Expenses
|
|
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|
|
|
|
|
|
Interest
and other debt financing expenses
|
|
2,970
|
|
2,865
|
|
10,781
|
|
6,550
|
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Base
management fee
|
|
2,308
|
|
2,220
|
|
8,495
|
|
5,789
|
|
Incentive
fee
|
|
1,967
|
|
1,917
|
|
6,228
|
|
348
|
|
Professional fees
|
|
545
|
|
538
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|
2,231
|
|
2,204
|
|
Administrative service fee
|
|
507
|
|
489
|
|
1,713
|
|
837
|
|
General
and administrative expenses
|
|
131
|
|
104
|
|
535
|
|
606
|
|
|
|
|
|
|
|
|
|
|
Total
expenses
|
|
8,428
|
|
8,133
|
|
29,983
|
|
16,334
|
|
|
|
|
|
|
|
|
|
|
Net
investment income
|
|
7,791
|
|
6,678
|
|
27,876
|
|
22,816
|
|
|
|
|
|
|
|
|
|
|
Net
gain (loss) on investments
|
|
|
|
|
|
|
|
|
|
Net
realized (loss) gain on investments
|
|
(464)
|
|
(70)
|
|
(5,467)
|
|
1,997
|
|
Net
realized (loss) gain on derivative instruments
|
|
(122)
|
|
1,228
|
|
2,095
|
|
40
|
|
Net change
in unrealized appreciation (depreciation) on investments
|
|
1,689
|
|
(795)
|
|
5,270
|
|
(1,528)
|
|
Net change
in unrealized (depreciation) appreciation on derivative
instruments
|
|
(149)
|
|
(1,648)
|
|
1,986
|
|
(1,986)
|
|
|
|
|
|
|
|
|
|
|
Net
gain (loss) on investments
|
|
954
|
|
(1,285)
|
|
3,884
|
|
(1,477)
|
|
|
|
|
|
|
|
|
|
|
Net
increase in net assets resulting from operations
|
|
$
8,745
|
|
$
5,393
|
|
$
31,760
|
|
$
21,339
|
|
|
|
|
|
|
|
|
|
|
Per
Common Share Data
|
|
|
|
|
|
|
|
|
|
Basic and
diluted earnings per common share
|
|
$
0.34
|
|
$
0.21
|
|
$
1.31
|
|
$
1.09
|
|
Dividends
and distributions declared per common share
|
|
$
0.32
|
|
$
0.32
|
|
$
1.28
|
|
$
1.27
|
|
Basic and
diluted weighted average common shares outstanding
|
|
25,663,827
|
|
25,639,680
|
|
24,271,251
|
|
19,631,797
|
|
|
|
|
|
|
|
|
|
ABOUT GOLUB CAPITAL BDC, INC.
Golub Capital BDC, Inc. principally invests in senior secured,
one stop, 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
With over $7 billion of capital
under management, Golub Capital is a leading provider of financing
solutions for the middle market, including one stop financings
(through the firm's proprietary GOLD and MEGA GOLD facilities), senior, second lien, and
subordinated debt, preferred stock and co-investment equity. The
firm underwrites and syndicates senior credit facilities up to
$250 million. Golub Capital's hold
sizes range up to $200 million per
transaction.
Golub Capital has been a Top 3 Traditional Middle Market
Bookrunner each year from 2008 through 3Q 2012 for senior secured
loans of up to $100 million for
leveraged buyouts (according to Thomson Reuters LPC and internal
data; based on number of deals). In 2012, Golub Capital was awarded
the ACG New York Champion's Award for "Senior Lender Firm of the
Year." Golub Capital is a national firm with principal offices in
Chicago and New York. For more information, please visit
the firm's website at www.golubcapital.com.
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 expressed or implied in the
forward-looking statements as a result of a number of factors,
including those described from time to time in filings with the
Securities and Exchange Commission. Golub Capital BDC, Inc.
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.