NEW YORK, April 13, 2020 /PRNewswire/ -- Golub Capital BDC,
Inc. (NASDAQ: GBDC) ("we," "us," "our," "GBDC" or the "Company"),
announced today that on April 9, 2020
GBDC's Board of Directors ("Board") declared a quarterly
distribution of $0.29 per share,
payable on June 29, 2020 to holders
of record as of June 9, 2020. In
addition, the Company announced its preliminary estimates of
certain financial results for its second fiscal quarter ended
March 31, 2020.1
David B. Golub, Chief Executive
Officer of GBDC, said:
"We are encouraged by GBDC's preliminary estimates of second
fiscal quarter 2020 results. Adjusted Net Investment Income
Per Share is estimated to be between $0.32 to $0.34,
consistent with our normal historical range, and non-accruals are
estimated to remain below 2.0% of total investments at fair value.
At the same time, and as expected, the preliminary estimates
reflect significant unrealized fair value adjustments related to
COVID-19 impacts on market conditions. The board of directors has
also decided that GBDC can maintain a substantial cash dividend and
has declared a cash dividend for the fiscal third quarter of
$0.29 per share payable in
June. This is consistent with historical quarterly cash
distributions at an annualized rate of approximately 8% of NAV,
which the Company has historically out-earned."
Set forth in the table below are certain preliminary estimates
of our financial condition and results of operations for the three
months ended March 31, 2020. These
estimates are subject to the completion of financial closing
procedures and are not a comprehensive statement of the Company's
financial results for the three months ended March 31, 2020. Actual results may differ
materially from these estimates as a result of the completion of
our financial closing procedures, final adjustments and other
developments arising between now and the time that financial
quarterly results for the three months ended March 31, 2020 are finalized.
PRELIMINARY
ESTIMATES OF CERTAIN FINANCIAL RESULTS
|
|
|
|
|
|
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Estimated to
have
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Totaled
between:
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Net Investment
Income Per Share
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|
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|
Net investment income
per share
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$
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0.22
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$
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0.26
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Amortization of
purchase premium per share1
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0.10
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0.08
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Adjusted net
investment income per share1
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$
|
0.32
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$
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0.34
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Net
Realized/Unrealized Gain (Loss) Per Share
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Net
realized/unrealized gain (loss) per share
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$
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(2.12)
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$
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(1.91)
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Reversal of
unrealized loss resulting from the amortization of the purchase
price premium per share1
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(0.10)
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|
|
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(0.08)
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Adjusted net
realized/unrealized gain (loss) per share1
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$
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(2.22)
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$
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(1.99)
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Earnings per
Share
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Earnings per
share
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$
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(1.90)
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$
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(1.65)
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Adjusted earnings per
share1
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$
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(1.90)
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$
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(1.65)
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Net Asset Value
per Share
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Net asset value per
share
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$
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14.43
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$
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14.68
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1 On September 16,
2019, the Company completed its acquisition of Golub Capital
Investment Corporation ("GCIC"). The acquisition was accounted for
under the asset acquisition method of accounting in accordance with
Accounting Standards Codification 805-50, Business Combinations —
Related Issues. Under asset acquisition accounting, where the
consideration paid to GCIC's stockholders exceeded the relative
fair values of the assets acquired and the liabilities assumed, the
premium paid by the Company was allocated to the cost of the GCIC
assets acquired by the Company pro-rata based on their relative
fair value. Immediately following the acquisition of GCIC, the
Company recorded its assets at their respective fair values and, as
a result, the purchase premium allocated to the cost basis of the
GCIC assets acquired was immediately recognized as unrealized
depreciation on the Company's Consolidated Statement of Operations.
The purchase premium allocated to investments in loan securities
acquired from GCIC will amortize over the life of the loans through
interest income with a corresponding reversal of the unrealized
depreciation on such loans acquired through their ultimate
disposition. The purchase premium allocated to investments in
equity securities will not amortize over the life of the equity
securities through interest income and, assuming no subsequent
change to the fair value of the GCIC equity securities acquired and
disposition of such equity securities at fair value, the Company
will recognize a realized loss with a corresponding reversal of the
unrealized depreciation upon disposition of the GCIC equity
securities acquired.
As a supplement to U.S. generally accepted accounting principles
("GAAP") financial measures, the Company is providing the following
estimates of non-GAAP financial measures that it believes are
useful for the reasons described below:
- "Adjusted Net Investment Income Per Share" – excludes
the amortization of the purchase premium and the accrual for the
capital gain incentive fee (including the portion of such accrual
that is not payable under the Company's investment advisory
agreement) from net investment income calculated in accordance
with GAAP.
- "Adjusted Net Realized and Unrealized Gain/(Loss) Per
Share" – excludes the unrealized loss resulting from the
purchase premium write-down and the corresponding reversal of the
unrealized loss from the amortization of the premium on loans or
from the sale of equity investments from the determination of
realized and unrealized gain/(loss) determined in accordance with
GAAP.
- "Adjusted Earnings Per Share" – calculates net income
and earnings per share based on Adjusted Net Investment Income Per
Share and Adjusted Net Realized and Unrealized Gain/(Loss) Per
Share.
The Company believes that excluding the financial impact of the
purchase premium in the above non-GAAP financial measures is useful
for investors as it is a non-cash expense/loss resulting from the
acquisition of GCIC and is one method the Company uses to measure
its financial condition and results of operations. In addition, the
Company believes excluding the accrual of the capital gain
incentive fee in the above non-GAAP financial measures is useful as
it includes the portion of such accrual that is not contractually
payable under the terms of the Company's investment advisory
agreement with GC Advisors. Although these estimates of non-GAAP
financial measures are intended to enhance investors' understanding
of our business and performance, these non-GAAP financial measures
should not be considered an alternative to GAAP.
Second Fiscal Quarter 2020 Preliminary Estimates of Certain
Financial Results
- On April 9, 2020, our board of
directors declared a quarterly distribution of $0.29 per share, payable on June 29, 2020 to stockholders of record as of
June 9, 2020.
- We estimate our NAV per share as of March 31, 2020 will be between $14.43 and $14.68.
- As of March 31, 2020, we estimate
that non-accrual investments as a percentage of total investments
at fair value were less than 2.0% and that non-accrual investments
as a percentage of total investments at cost were less than
3.0%. Additionally, we estimate that the number of
non-accrual investments increased from seven investments as of
December 31, 2019 to ten investments
as of March 31, 2020.
- As of March 31, 2020, we were in
compliance with all of our covenants under our revolving credit
facilities and debt securitizations.
- During the three months ended March 31,
2020, we estimate originations in new middle market
investment commitments were $171.1
million. Approximately 66.0% of the new middle-market
investment commitments were one stop loans, 33.0% were senior
secured loans and 1.0% were equity securities. In addition, on
January 1, 2020, we acquired the
limited liability company equity interests in Senior Loan Fund LLC
("SLF") and GCIC Senior Loan Fund LLC ("GCIC SLF") that had been
held by our joint venture partners. As a result of the
transactions, on January 1, 2020, SLF
and GCIC SLF became wholly-owned subsidiaries of ours and the
assets and liabilities of SLF and GCIC SLF will be consolidated
into our financial statements as of and for the period ended
March 31, 2020.
- Total investments at fair value are estimated to have decreased
by between $227.9 million and
$247.9 million during the three
months ended March 31, 2020 after
factoring in debt repayments, sales of securities, net fundings on
revolvers, and net change in unrealized gains (losses).
- For the three months ended March 31,
2020, the estimated adjusted net realized/unrealized loss
per share of between $1.99 and
$2.22 resulted from an increase in
unrealized depreciation in respect of our portfolio company
investments resulting from decreases in the fair value of some of
our portfolio company investments primarily due to the immediate
adverse economic effects of the COVID-19 pandemic, the continuing
uncertainty surrounding its long-term impact and increases in the
spread between the yields realized on risk-free and higher risk
securities.
The preliminary estimates described in this press
release are subject to the completion of our financial
closing procedures and are not a comprehensive statement of our
financial results for the three months ended March 31, 2020. Our actual results may differ
materially from these estimates as a result of the completion
of our financial closing procedures, final adjustments and other
developments arising between now and the time that our
financial results for the three months ended March 31, 2020 are finalized. These
preliminary estimates have been prepared by, and are the
responsibility of, management. Our independent registered
public accounting firm has not audited, reviewed, compiled or
performed any procedures with respect to such preliminary
estimates, and, accordingly, does not express an opinion or
any other form of assurance with respect thereto.
Conference Call
- We intend to announce final results of operations as of and for
the three and six months ended March 31,
2020 on or around May 11,
2020. We intend to announce the timing of an earnings
conference call to discuss the quarterly financial results on or
around April 15, 2020.
ABOUT GOLUB CAPITAL BDC, INC.
Golub Capital BDC, Inc. ("GBDC") is an externally-managed,
non-diversified closed-end management investment company that has
elected to be treated as a business development company under the
Investment Company Act of 1940. GBDC invests primarily in one stop
and other senior secured loans to middle market companies that are
often sponsored by private equity investors. GBDC's investment
activities are managed by its investment adviser, GC Advisors LLC,
an affiliate of the Golub Capital LLC group of companies ("Golub
Capital").
ABOUT GOLUB CAPITAL
Golub Capital is a market-leading, award-winning direct lender
and credit asset manager, with over $30
billion of capital under management. Golub Capital
specializes in delivering reliable, creative and compelling
financing solutions to middle market companies backed by private
equity sponsors. The firm's credit expertise also forms the
foundation of its Late Stage Lending business and its Broadly
Syndicated Loan investment program. Across its activities, Golub
Capital nurtures long-term, win-win partnerships that inspire
repeat business from its private equity sponsor clients and
investors. Founded over 25 years ago, Golub Capital today has over
500 employees and lending offices in Chicago, New
York, San Francisco and
London. For more information,
please visit 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.
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SOURCE Golub Capital BDC, Inc.