NEW
YORK, May 8, 2024 /PRNewswire/ -- Blue Owl
Capital Corporation (NYSE: OBDC, or the "Company") today announced
financial results for its first quarter ended March 31,
2024.
FIRST QUARTER 2024 HIGHLIGHTS
- First quarter net investment income ("NII") per share of
$0.47, exceeding the regular dividend
by over 25%
- As a result, the Board of Directors (the "Board") declared a
first quarter supplemental dividend of $0.05 per share
- Total dividends for the first quarter were $0.42 per share, representing a 10.9% annualized
dividend yield based on first quarter net asset value ("NAV") per
share
- NAV per share increased to $15.47
compared to $15.45 as of December 31, 2023, which represents the Company's
highest NAV per share since inception
"OBDC's first quarter results reflect a strong start to the
year, achieving record net asset value per share for the third
consecutive quarter while maintaining solid credit
performance," commented Craig W.
Packer, Chief Executive Officer. "We generated a 12.1%
return on equity this quarter, which we view as a very compelling
rate of return for a portfolio comprised of predominantly first
lien loans in high-quality, upper-middle market companies."
Dividend Declarations
The Company's Board
declared a second quarter 2024 regular dividend of $0.37 per share for stockholders of record as of
June 28, 2024, payable on or before
July 15, 2024.
The Board also declared a first quarter 2024 supplemental
dividend of $0.05 per share for
stockholders of record as of May 31,
2024, payable on or before June 14,
2024.
2024 Stock Repurchase Program
On May 6, 2024, the Board approved the 2024
Repurchase Program (the "repurchase program") under which the
Company may repurchase up to $150
million of the Company's common stock. Under the repurchase
program, purchases may be made at management's discretion from time
to time in open-market transactions, including via trading plans
with investment banks pursuant to Rule 10b5-1 of the Exchange Act,
in accordance with all applicable rules and regulations. Unless
extended by the Board, the repurchase program will terminate 18
months from the date it was approved.
PORTFOLIO AND INVESTING ACTIVITY
For the three months ended March 31, 2024, new investment
commitments totaled $1,202.7 million
across 18 new portfolio companies and 13 existing portfolio
companies. This compares to $1,296.9
million for the three months ended December 31, 2023
across 17 new portfolio companies and 14 existing portfolio
companies.
For the three months ended March 31, 2024, the principal
amount of new investments funded was $920.4
million. For this period, the Company had $1,241.4 million aggregate principal amount in
sales and repayments.
For the three months ended December 31, 2023, the principal
amount of new investments funded was $1,029.9 million. For this period, the Company
had $1,142.6 million aggregate
principal amount in sales and repayments.
As of March 31, 2024 and December 31, 2023, the
Company had investments in 198 and 193 portfolio companies with an
aggregate fair value of $12.4 billion
and $12.7 billion, respectively. As
of March 31, 2024, the average investment size in each
portfolio company was $62.7 million
based on fair value.
As of March 31, 2024, based on fair value, our portfolio
consisted of 73.0% first lien senior secured debt investments, 7.7%
second lien senior secured debt investments, 2.2% unsecured debt
investments, 2.8% joint ventures, 3.6% preferred equity
investments, and 10.7% common equity investments.
As of December 31, 2023, based on fair value, our portfolio
consisted of 68.1% first lien senior secured debt investments,
14.0% second lien senior secured debt investments, 2.3% unsecured
debt investments, 2.7% joint ventures, 3.4% preferred equity
investments, and 9.5% common equity investments.
As of March 31, 2024 and December 31, 2023,
approximately 80.7% and 82.1% of the portfolio was invested in
secured debt, respectively. As of March 31, 2024, 97.3% of our
debt investments based on fair value in our portfolio were at
floating rates.
As of March 31, 2024 and December 31, 2023, the
weighted average total yield of accruing debt and income-producing
securities at fair value (which includes interest income and
amortization of fees and discounts) was 12.1% and 12.4%,
respectively, and the weighted average total yield of accruing debt
and income-producing securities at amortized cost (which includes
interest income and amortization of fees and discounts) was 12.3%
and 12.5%, respectively.
As of March 31, 2024, loans on non-accrual represented 1.8%
of the total fair value of the debt portfolio.
RESULTS OF OPERATIONS FOR THE FIRST QUARTER ENDED
MARCH 31, 2024
Investment Income
Investment income increased
to $399.6 million for the three
months ended March 31, 2024 from $377.6
million for the same period in the prior year due to an
increase in interest income earned from prepayment fees and
accelerated amortization of upfront fees from unscheduled paydowns,
partially offset by a decrease in our debt investments portfolio at
par. Included in investment income is dividend income which
includes income earned from our controlled, affiliated and
non-controlled, affiliated equity investments. Dividend income
increased primarily due to an increase in dividends earned from our
controlled, affiliated and non-controlled, affiliated equity
investments. Other income increased period-over-period due to an
increase in incremental fee income, which are fees that are
generally available to us as a result of closing investments and
normally paid at the time of closing. We expect that investment
income will vary based on a variety of factors including the pace
of our originations and repayments.
Expenses
Total expenses increased to
$211.6 million for the three months
ended March 31, 2024 from $196.4
million for the same period in the prior year primarily due
to an increase in interest expense. The increase in interest
expense was driven by an increase in the average interest rate
period over period while our average borrowings outstanding stayed
consistent during both periods. As a percentage of total assets,
management fees, incentive fees, professional fees, directors' fees
and other general and administrative expenses remained relatively
consistent period over period.
Liquidity and Capital Resources
As of
March 31, 2024, we had $742.8
million in cash and restricted cash, $7.0 billion in total principal value of debt
outstanding, and $1.7 billion of
undrawn capacity on our credit facilities. The Company's weighted
average interest rate on debt outstanding was 5.8% and 5.6% for the
three months ended March 31, 2024 and December 31, 2023,
respectively. Ending net debt to equity was 1.04x and 1.09x as of
March 31, 2024 and December 31, 2023, respectively.
CONFERENCE CALL AND WEBCAST INFORMATION
Conference Call Information:
The conference
call will be broadcast live on May 9,
2024 at 10:00 a.m. Eastern
Time on the Events section of OBDC's website at
www.BlueOwlCapitalCorporation.com. Please visit the website to test
your connection before the webcast.
Participants are also invited to access the conference call by
dialing one of the following numbers:
- Domestic: (877) 737-7048
- International: +1 (201) 689-8523
All callers will need to reference "Blue Owl Capital
Corporation" once connected with the operator. All callers are
asked to dial in 10-15 minutes prior to the call so that name and
company information can be collected.
Replay Information:
An archived replay will be
available for 14 days via a webcast link located on the Events
section of OBDC's website, and via the dial-in numbers listed
below:
- Domestic: (877) 660-6853
- International: +1 (201) 612-7415
- Conference ID: 13745168
ABOUT BLUE OWL CAPITAL CORPORATION
Blue Owl Capital Corporation (NYSE: OBDC) is a specialty finance
company focused on lending to U.S. middle-market companies. As of
March 31, 2024, OBDC had investments in 198 portfolio
companies with an aggregate fair value of $12.4 billion. OBDC has elected to be regulated
as a business development company under the Investment Company Act
of 1940, as amended. OBDC is externally managed by Blue Owl Credit
Advisors LLC, an SEC-registered investment adviser that is an
indirect affiliate of Blue Owl Capital Inc. ("Blue Owl") (NYSE:
OWL) and is a part of Blue Owl's Credit platform.
Certain information contained herein may constitute
"forward-looking statements" that involve substantial risks and
uncertainties. Such statements involve known and unknown risks,
uncertainties and other factors and undue reliance should not be
placed thereon. These forward-looking statements are not historical
facts, but rather are based on current expectations, estimates and
projections about OBDC, its current and prospective portfolio
investments, its industry, its beliefs and opinions, and its
assumptions. Words such as "anticipates," "expects," "intends,"
"plans," "will," "may," "continue," "believes," "seeks,"
"estimates," "would," "could," "should," "targets," "projects,"
"outlook," "potential," "predicts" and variations of these words
and similar expressions are intended to identify forward-looking
statements. These statements are not guarantees of future
performance and are subject to risks, uncertainties and other
factors, some of which are beyond OBDC's control and difficult to
predict and could cause actual results to differ materially from
those expressed or forecasted in the forward-looking statements
including, without limitation, the risks, uncertainties and other
factors identified in OBDC's filings with the SEC. Investors should
not place undue reliance on these forward-looking statements, which
apply only as of the date on which OBDC makes them. OBDC does not
undertake any obligation to update or revise any forward-looking
statements or any other information contained herein, except as
required by applicable law.
INVESTOR CONTACTS
Investor Contact:
BDC Investor Relations
credit-ir@blueowl.com
Media Contact:
Prosek Partners
Josh Clarkson
pro-blueowl@prosek.com
FINANCIAL
HIGHLIGHTS
|
|
|
For the Three Months
Ended
|
($ in thousands, except
per share amounts)
|
March 31,
2024
|
December 31,
2023
|
|
March 31,
2023
|
Investments at Fair
Value
|
$
12,414,384
|
$
12,713,348
|
|
$
13,157,251
|
Total Assets
|
$
13,329,632
|
$
13,511,396
|
|
$
13,679,100
|
Net Asset Value Per
Share
|
$
15.47
|
$
15.45
|
|
$
15.15
|
|
|
|
|
|
Investment
Income
|
$
399,577
|
$
411,227
|
|
$
377,622
|
Net Investment
Income
|
$
182,765
|
$
199,021
|
|
$
177,859
|
Net Income
|
$
182,517
|
$
188,969
|
|
$
201,842
|
|
|
|
|
|
Net Investment Income
Per Share
|
$
0.47
|
$
0.51
|
|
$
0.45
|
Net Realized and
Unrealized Gains (and Losses) Per Share
|
$
—
|
$
(0.03)
|
|
$
0.07
|
Net Income Per
Share
|
$
0.47
|
$
0.48
|
|
$
0.52
|
Distributions Declared
from Net Investment Income Per Share
|
$
0.37
|
$
0.35
|
|
$
0.33
|
Supplemental
Distributions Declared from Net Investment Income Per
Share
|
$
0.05
|
$
0.08
|
|
$
0.06
|
Weighted Average Yield
of Accruing Debt and Income Producing Securities at Fair
Value
|
12.1 %
|
12.4 %
|
|
12.0 %
|
Weighted Average Yield
of Accruing Debt and Income Producing Securities at Amortized
Cost
|
12.3 %
|
12.5 %
|
|
12.0 %
|
Percentage of Debt
Investment Commitments at Floating Rates
|
97.3 %
|
97.4 %
|
|
98.2 %
|
CONSOLIDATED
STATEMENTS OF ASSETS AND LIABILITIES
|
(Amounts in
thousands, except share and per share amounts)
|
|
|
|
March 31,
2024
(Unaudited)
|
|
December 31,
2023
|
Assets
|
|
|
|
|
Investments at fair
value
|
|
|
|
|
Non-controlled,
non-affiliated investments (amortized cost of $10,843,376 and
$11,271,962, respectively)
|
|
$
10,831,170
|
|
$
11,264,956
|
Non-controlled,
affiliated investments (amortized cost of $31,026 and $19,004,
respectively)
|
|
32,223
|
|
19,988
|
Controlled, affiliated
investments (amortized cost of $1,454,485, and $1,341,236,
respectively)
|
|
1,550,991
|
|
1,428,404
|
Total investments at
fair value (amortized cost of $12,328,887 and $12,632,202,
respectively)
|
|
12,414,384
|
|
12,713,348
|
Cash (restricted cash
of $89,838 and $87,067, respectively)
|
|
666,716
|
|
658,702
|
Foreign cash (cost of
$76,145 and $946, respectively)
|
|
76,095
|
|
956
|
Interest
receivable
|
|
119,050
|
|
112,260
|
Receivable from a
controlled affiliate
|
|
25,985
|
|
22,978
|
Prepaid expenses and
other assets
|
|
27,402
|
|
3,152
|
Total
Assets
|
|
$
13,329,632
|
|
$
13,511,396
|
Liabilities
|
|
|
|
|
Debt (net of
unamortized debt issuance costs of $90,019 and $81,492,
respectively)
|
|
$
6,885,675
|
|
$
7,077,088
|
Distribution
payable
|
|
144,201
|
|
136,407
|
Management fee
payable
|
|
47,243
|
|
47,711
|
Incentive fee
payable
|
|
38,768
|
|
42,217
|
Payables to
affiliates
|
|
6,252
|
|
3,835
|
Accrued expenses and
other liabilities
|
|
178,963
|
|
182,745
|
Total
Liabilities
|
|
7,301,102
|
|
7,490,003
|
Commitments and
contingencies (Note 7)
|
|
|
|
|
Net
Assets
|
|
|
|
|
Common shares $0.01 par
value, 500,000,000 shares authorized; 389,732,868 and
389,732,868 shares issued and outstanding, respectively
|
|
3,897
|
|
3,897
|
Additional
paid-in-capital
|
|
5,924,002
|
|
5,924,002
|
Accumulated
undistributed (overdistributed) earnings
|
|
100,631
|
|
93,494
|
Total Net
Assets
|
|
6,028,530
|
|
6,021,393
|
Total Liabilities
and Net Assets
|
|
$
13,329,632
|
|
$
13,511,396
|
Net Asset Value Per
Share
|
|
$
15.47
|
|
$
15.45
|
CONSOLIDATED
STATEMENTS OF OPERATIONS
|
(Amounts in
thousands, except share amounts)
|
(Unaudited)
|
|
|
For the Three Months
Ended
March 31,
|
|
2024
|
|
2023
|
Investment
Income
|
|
|
|
Investment income from
non-controlled, non-affiliated investments:
|
|
|
|
Interest
income
|
$
294,450
|
|
$
288,678
|
Payment-in-kind
("PIK") interest income
|
41,235
|
|
43,055
|
Dividend
income
|
21,336
|
|
17,833
|
Other
income
|
5,313
|
|
2,964
|
Total investment income
from non-controlled, non-affiliated investments
|
362,334
|
|
352,530
|
Investment income from
non-controlled, affiliated investments:
|
|
|
|
Interest
income
|
$
68
|
|
—
|
Dividend
income
|
16
|
|
—
|
Total investment income
from non-controlled, affiliated investments:
|
84
|
|
—
|
Investment income from
controlled, affiliated investments:
|
|
|
|
Interest
income
|
8,002
|
|
2,674
|
Payment-in-kind
("PIK") interest income
|
176
|
|
—
|
Dividend
income
|
28,789
|
|
22,026
|
Other
Income
|
192
|
|
392
|
Total investment income
from controlled, affiliated investments
|
37,159
|
|
25,092
|
Total Investment
Income
|
399,577
|
|
377,622
|
Expenses
|
|
|
|
Interest
expense
|
119,129
|
|
103,955
|
Management
fees
|
47,243
|
|
48,093
|
Performance based
incentive fees
|
38,768
|
|
37,728
|
Professional
fees
|
3,596
|
|
3,673
|
Directors'
fees
|
320
|
|
258
|
Other general and
administrative
|
2,516
|
|
2,671
|
Total Operating
Expenses
|
211,572
|
|
196,378
|
Net Investment
Income (Loss) Before Taxes
|
188,005
|
|
181,244
|
Income tax expense
(benefit)
|
5,240
|
|
3,385
|
Net Investment
Income (Loss) After Taxes
|
$
182,765
|
|
$
177,859
|
Net Realized and
Change in Unrealized Gain (Loss)
|
|
|
|
Net change in
unrealized gain (loss):
|
|
|
|
Non-controlled,
non-affiliated investments
|
$
(951)
|
|
$
65,423
|
Non-controlled,
affiliated investments
|
214
|
|
(1)
|
Controlled, affiliated
investments
|
9,338
|
|
10,254
|
Translation of assets
and liabilities in foreign currencies
|
(1,946)
|
|
1,210
|
Income tax (provision)
benefit
|
(10)
|
|
(281)
|
Total Net Change in
Unrealized Gain (Loss)
|
6,645
|
|
76,605
|
Net realized gain
(loss):
|
|
|
|
Non-controlled,
non-affiliated investments
|
(5,193)
|
|
(52,483)
|
Foreign currency
transactions
|
(1,700)
|
|
(139)
|
Total Net Realized
Gain (Loss)
|
(6,893)
|
|
(52,622)
|
Total Net Realized
and Change in Unrealized Gain (Loss)
|
(248)
|
|
23,983
|
Net Increase
(Decrease) in Net Assets Resulting from Operations
|
$
182,517
|
|
$
201,842
|
Earnings Per Share
- Basic and Diluted
|
$
0.47
|
|
$
0.52
|
Weighted Average
Shares Outstanding - Basic and Diluted
|
389,732,868
|
|
391,049,102
|
PORTFOLIO AND
INVESTMENT ACTIVITY
|
|
|
|
For the Three Months
Ended March 31,
|
($ in
thousands)
|
|
2024
|
|
2023
|
New investment
commitments
|
|
|
|
|
Gross
originations
|
|
$
1,240,198
|
|
$
175,114
|
Less: Sell
downs
|
|
(37,500)
|
|
—
|
Total new investment
commitments
|
|
$
1,202,698
|
|
$
175,114
|
Principal amount of
investments funded:
|
|
|
|
|
First-lien senior
secured debt investments
|
|
$
844,033
|
|
$
36,809
|
Second-lien senior
secured debt investments
|
|
—
|
|
—
|
Unsecured debt
investments
|
|
—
|
|
—
|
Preferred equity
investments
|
|
732
|
|
24,194
|
Common equity
investments
|
|
69,042
|
|
9,653
|
Joint
Ventures(1)
|
|
6,563
|
|
23,625
|
Total principal amount
of investments funded
|
|
$
920,370
|
|
$
94,281
|
Principal amount of
investments sold or repaid:
|
|
|
|
|
First-lien senior
secured debt investments
|
|
$
(412,299)
|
|
$
(56,696)
|
Second-lien senior
secured debt investments
|
|
(800,422)
|
|
(19,200)
|
Unsecured debt
investments
|
|
(28,278)
|
|
(193)
|
Preferred equity
investments
|
|
(373)
|
|
—
|
Common equity
investments
|
|
—
|
|
—
|
Joint
Ventures(1)
|
|
—
|
|
—
|
Total principal amount
of investments sold or repaid
|
|
$ (1,241,372)
|
|
$
(76,089)
|
Number of new
investment commitments in new portfolio companies(2)
|
|
18
|
|
3
|
Average new
investment commitment amount
|
|
$
51,899
|
|
$
941
|
Weighted average
term for new debt investment commitments (in years)
|
|
5.8
|
|
3.0
|
Percentage of new
debt investment commitments at floating rates
|
|
99.9 %
|
|
100.0 %
|
Percentage of new
debt investment commitments at fixed rates
|
|
0.1 %
|
|
— %
|
Weighted average
interest rate of new debt investment commitments(3)
|
|
11.1 %
|
|
12.4 %
|
Weighted average
spread over applicable base rate of new floating rate debt
investment commitments
|
|
5.7 %
|
|
7.2 %
|
________________
|
(1)
|
This was disclosed as
"Investment funds and vehicles" as of March 31, 2023.
|
(2)
|
Number of new
investment commitments represents commitments to a particular
portfolio company.
|
(3)
|
For the three months
ended March 31, 2024, assumes each floating rate commitment is
subject to the greater of the interest rate floor (if applicable)
or 3-month SOFR, which was 5.30% as of March 31, 2024. For the
three months ended March 31, 2023, assumes each floating rate
commitment is subject to the greater of the interest rate floor (if
applicable) or 3-month SOFR, which was 4.91% as of March 31,
2023.
|
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SOURCE Blue Owl Capital Corporation