EX-99.1 2 d838471dex991.htm EX-99.1 EX-99.1

Exhibit 99.1

 

LOGO

Oaktree Specialty Lending Corporation Announces Fourth Fiscal Quarter and Full Year 2019 Financial Results and Declares Distribution of $0.095 Per Share

LOS ANGELES, CA, November 20, 2019—Oaktree Specialty Lending Corporation (NASDAQ: OCSL) (“Oaktree Specialty Lending” or the “Company”), a specialty finance company, today announced its financial results for the fiscal quarter and year ended September 30, 2019.

Financial Highlights for the Quarter and Year Ended September 30, 2019

 

   

Total investment income was $34.5 million ($0.24 per share) and $147.7 million ($1.05 per share) for the fourth fiscal quarter and full fiscal year of 2019, respectively, as compared with $36.7 million ($0.26 per share) and $138.7 million ($0.98 per share) for the third fiscal quarter of 2019 and the full fiscal year of 2018, respectively. The increase in investment income for the full year was primarily due to higher levels of original issue discount (“OID”) accretion and call protection fees earned on exits of certain investments.

 

   

Net investment income was $16.3 million ($0.12 per share) and $67.9 million ($0.48 per share) for the fourth fiscal quarter and full fiscal year of 2019, respectively, as compared with $16.6 million ($0.12 per share) and $60.0 million ($0.43 per share) for the third fiscal quarter of 2019 and the full fiscal year of 2018, respectively. The increase in net investment income for the full year was primarily due to higher levels of investment income and lower professional fees and general and administration expenses.

 

   

Net asset value (“NAV”) per share was $6.60 as of September 30, 2019, flat as compared to $6.60 as of June 30, 2019 and up 8% from $6.09 as of September 30, 2018. The increase in NAV was primarily due to capital gains realized through the monetization of investments and appreciation of certain debt and equity investments.

 

   

Originated $138.4 million of new investment commitments and received $139.0 million of proceeds from prepayments, exits, other paydowns and sales during the quarter ended September 30, 2019.

 

   

A quarterly distribution was declared of $0.095 per share, payable on December 31, 2019 to stockholders of record on December 13, 2019.

Mathew Pendo, President and Chief Operating Officer, said, “The fourth quarter of 2019 capped another strong fiscal year for OCSL. NAV grew by more than 8 percent over the last twelve months. We also made further progress reducing risk in the portfolio, successfully exiting $60 million of non-core investments during the quarter, including a par recovery from a large investment on non-accrual. Looking ahead, with $385 million of dry powder, we remain well-positioned to take advantage of future investment opportunities.”

Armen Panossian, who was appointed Chief Executive Officer and Chief Investment Officer in September 2019, said, “The team managing OCSL has done a superb job growing NAV and repositioning the portfolio for stronger risk-adjusted returns over the past two years. I look forward to building on these accomplishments by continuing to execute on our strategic plan while maintaining our disciplined and risk-controlled investment approach.”

Distribution Declaration

The Board of Directors declared a quarterly distribution of $0.095 per share, payable on December 31, 2019 to stockholders of record on December 13, 2019.

 

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Distributions are paid primarily from distributable (taxable) income. To the extent taxable earnings for a fiscal taxable year fall below the total amount of distributions for that fiscal year, a portion of those distributions may be deemed a return of capital to the Company’s stockholders.

Results of Operations

 

    

 

    

 

 
     For the three months ended      For the year ended  
($ in thousands, except per share data)    September 30,
2019
(unaudited)
    June 30,
2019
(unaudited)
     September 30,
2018
(unaudited)
     September 30,
2019
     September 30,
2018
 

GAAP operating results:

             

Interest income

   $ 30,662     $ 32,910      $ 35,306      $ 133,670      $ 118,511  

PIK interest income

     1,187       1,198        499        5,497        5,769  

Fee income

     2,550       1,826        2,034        6,710        9,432  

Dividend income

     114       735        381        1,825        5,010  
  

 

 

   

 

 

    

 

 

    

 

 

    

 

 

 

Total investment income

     34,513       36,669        38,220        147,702        138,722  

Net expenses

     18,238       20,061        21,189        79,793        78,676  
  

 

 

   

 

 

    

 

 

    

 

 

    

 

 

 

Net investment income

     16,275       16,608        17,031        67,909        60,046  

Net realized and unrealized gains (losses), net of taxes

     (2,304     3,378        16,300        58,251        (13,284
  

 

 

   

 

 

    

 

 

    

 

 

    

 

 

 

Net increase (decrease) in net assets resulting from operations

   $ 13,971     $ 19,986      $ 33,331      $ 126,160      $ 46,762  
  

 

 

   

 

 

    

 

 

    

 

 

    

 

 

 

Net investment income per common share

   $ 0.12     $ 0.12      $ 0.12      $ 0.48      $ 0.43  

Net realized and unrealized gains (losses), net of taxes per common share

   $ (0.02   $ 0.02      $ 0.12      $ 0.41      $ (0.10

Earnings (loss) per common share — basic and diluted

   $ 0.10     $ 0.14      $ 0.24      $ 0.89      $ 0.33  

Non-GAAP Financial Measures (1):

             

Adjusted net investment income

   $ 16,713     $ 17,293      $ 17,031      $ 69,032      $ 60,046  

Adjusted net investment income per common share

   $ 0.12     $ 0.12      $ 0.12      $ 0.49      $ 0.43  

 

(1)

See Non-GAAP Financial Measures — Adjusted Net Investment Income below for a description of this non-GAAP measure and a reconciliation from net investment income to adjusted net investment income, including on a weighted-average per share basis. The Company’s management uses this non-GAAP financial measure internally to analyze and evaluate financial results and performance and believes that this non-GAAP financial measure is useful to investors as an additional tool to evaluate ongoing results and trends for the Company without giving effect to capital gains incentive fees. The presentation of adjusted net investment income is not intended to be a substitute for financial results prepared in accordance with GAAP and should not be considered in isolation.

 

    

 

 
     As of  
($ in thousands, except per share data and ratios)    September 30,
2019
     June 30,
2019
(unaudited)
     September 30,
2018
 

Select balance sheet and other data:

        

Investment portfolio at fair value

   $ 1,438,042      $ 1,455,031      $ 1,491,201  

Total debt outstanding

     473,367        537,278        637,213  

Net assets

     930,630        930,050        858,035  

Net asset value per share

     6.60        6.60        6.09  

Total leverage

     0.51x        0.58x        0.75x  

Total investment income for the quarter ended September 30, 2019 was $34.5 million and included $30.7 million of interest income from portfolio investments, $1.2 million of payment-in-kind (“PIK”) interest income, $2.6 million of fee income and $0.1 million of dividend income. Total investment income decreased by $2.2 million as compared to the quarter ended June 30, 2019, primarily due to significant call protection fees earned in connection with exits that occurred during the prior quarter, lower interest income earned due to decreases in LIBOR on our floating rate investments and lower dividend income resulting from the sale of an aircraft in our aircraft leasing portfolio company that occurred during the quarter ended June 30, 2019. PIK interest income represented 3.4% of total investment income for the quarter ended September 30, 2019.

Total investment income for the year ended September 30, 2019 was $147.7 million and included $133.7 million of interest income from portfolio investments, $5.5 million of PIK interest income, $6.7 million of fee income and $1.8 million of dividend income. Total investment income increased by $9.0 million as compared to the year ended September 30, 2018, primarily due to higher levels of OID accretion and call protection fees earned on exits of certain investments that occurred during the year, partially offset by lower dividend income.

 

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Net expenses for the quarter totaled $18.2 million, down $1.8 million from the quarter ended June 30, 2019. The decrease in net expenses was primarily driven by lower interest expense resulting from a lower amount of borrowings outstanding and decreases in LIBOR during the quarter and a decrease in incentive fees, net of fees waived, mostly due to lower levels of investment income.

Net expenses for the year totaled $79.8 million, up $1.1 million from the year ended September 30, 2018. The increase in net expenses was primarily due to higher incentive fees resulting from higher investment income and capital gains realized through the monetization of certain investments and appreciation of certain debt and equity investments, partially offset by lower interest expense resulting from a lower amount of borrowings outstanding during the year, lower professional fees and lower general and administrative expenses.

Net realized and unrealized losses, net of taxes, were $2.3 million for the quarter, primarily reflecting unrealized depreciation on certain debt and equity investments. Net realized and unrealized gains, net of taxes, were $58.3 million for the year, primarily resulting from capital gains realized through the monetization of certain investments and unrealized appreciation of certain debt and equity investments.

Portfolio and Investment Activity

 

    

 

 
     As of  
($ in thousands)    September 30,
2019
(unaudited)
    June 30,
2019
(unaudited)
    September 30,
2018
(unaudited)
 

Investments at fair value

   $ 1,438,042     $ 1,455,031     $ 1,491,201  

Number of portfolio companies

     104       105       113  

Average portfolio company debt size

   $ 15,300     $ 15,400     $ 14,800  

Asset class:

      

Senior secured debt

     78.6     79.7     75.4

Unsecured debt

     5.7     7.0     11.0

Equity

     6.7     4.3     4.4

SLF JV I

     8.8     8.8     8.7

Limited partnership interests

     0.2     0.2     0.5

Non-accrual debt investments:

      

Non-accrual investments at fair value

   $ 2,706     $ 86,796     $ 98,760  

Non-accrual investments as a percentage of debt investments

     0.2     6.4     7.0

Number of investments on non-accrual

     3       5       8  

Interest rate type:

      

Percentage floating-rate

     89.8     88.5     83.2

Percentage fixed-rate

     10.2     11.5     16.8

Yields:

      

Weighted average yield on debt investments (1)

     8.9     8.7     8.4

Cash component of weighted average yield on debt investments

     8.1     8.0     8.2

Weighted average yield on total portfolio investments (2)

     8.2     8.2     8.1

Investment activity:

      

New investment commitments

   $ 138,400     $ 66,800     $ 228,400  

New funded investment activity (3)

   $ 128,500     $ 74,100     $ 218,400  

Proceeds from prepayments, exits, other paydowns and sales

   $ 139,000     $ 138,300     $ 267,500  

Net new investments (4)

   $ (10,500   $ (64,200   $ (49,100

Number of new investment commitments in new portfolio companies

     5       3       13  

Number of new investment commitments in existing portfolio companies

     4       4       3  

Number of portfolio company exits

     7       8       18  

 

(1)

Annual stated yield earned plus net annual amortization of original issue discount or premium earned on accruing investments, including the Company’s share of the return on debt investments in the SLF JV I.

(2)

Annual stated yield earned plus net annual amortization of original issue discount or premium earned on accruing investments and dividend income, including the Company’s share of the return on debt investments in the SLF JV I.

(3)

New funded investment activity includes drawdowns on existing revolver commitments.

(4)

Net new investments consists of new funded investment activity less proceeds from prepayments, exits, other paydowns and sales.

 

3


As of September 30, 2019, the fair value of the investment portfolio was $1.4 billion and was comprised of investments in 104 companies. These included debt investments in 79 companies, equity investments in 33 companies, including our limited partnership interests in two private equity funds, and our investment in Senior Loan Fund JV I, LLC (“SLF JV I”). Nine of the equity investments were in companies in which the Company also had a debt investment.

As of September 30, 2019, 91.0% of the Company’s portfolio as of September 30, 2019 consisted of debt investments, including 53.5% of first liens, 25.1% of second liens and 12.4% of unsecured debt investments, including the debt investments in SLF JV I at fair value.

As of September 30, 2019, there were three investments on which the Company had stopped accruing cash and/or PIK interest or OID income that, in the aggregate, represented 4.3% of the Company’s debt portfolio at cost and 0.2% at fair value. During the three months ended September 30, 2019, the Company removed two investments from non-accrual status in connection with an exit and restructuring.

As of September 30, 2019, SLF JV I had $360.9 million in assets, including senior secured loans to 51 portfolio companies. The joint venture generated income of $2.3 million for the Company during the quarter ended September 30, 2019. As of September 30, 2019, SLF JV I had $79.8 million of undrawn capacity on its senior revolving credit facility.

Over time, the Company intends to rotate out of the remaining investments it has identified as non-core investments, which is approximately $200 million at fair value as of September 30, 2019. It will also seek to redeploy non-income generating investments comprised of equity investments, limited partnership interests and loans currently on non-accrual status into proprietary investments with higher yields. Certain additional information on such categorization and the portfolio composition is included in investor presentations that the Company files with the Securities and Exchange Commission (“SEC”).

Liquidity and Capital Resources

As of September 30, 2019, the Company had $15.4 million of cash and cash equivalents, total principal value of debt outstanding of $476.1 million and $385.2 million of undrawn capacity on its credit facility, subject to borrowing base and other limitations. The weighted average interest rate on debt outstanding was 4.8% and 5.1% as of September 30, 2019 and June 30, 2019, respectively.

The Company’s total leverage ratio was 0.51x and 0.58x debt-to-equity as of September 30, 2019 and June 30, 2019, respectively.

Non-GAAP Financial Measures

Adjusted Net Investment Income

On a supplemental basis, the Company is disclosing adjusted net investment income and per share adjusted net investment income, each of which is a financial measure that is calculated and presented on a basis of methodology other than in accordance with U.S. GAAP (“non-GAAP”). Adjusted net investment income represents net investment income, excluding capital gains incentive fees (“Part II incentive fee”). The Company’s management uses this non-GAAP financial measure internally to analyze and evaluate financial results and performance and believes that this non-GAAP financial measure is

 

4


useful to investors as an additional tool to evaluate ongoing results and trends for the Company without giving effect to capital gains incentive fees. The Company’s investment advisory agreement provides that a capital gains-based incentive fee is determined and paid annually with respect to realized capital gains (but not unrealized capital appreciation) to the extent such realized capital gains exceed realized capital losses and unrealized capital depreciation on a cumulative basis. Refer to Note 11 – Related Party Transactions in our Annual Report on Form 10-K for further discussion. The Company believes that adjusted net investment income is a useful performance measure because it reflects the net investment income produced on the Company’s investments during a period without giving effect to any changes in the value of such investments and any related capital gains incentive fees between periods. The presentation of adjusted net investment income is not intended to be a substitute for financial results prepared in accordance with GAAP and should not be considered in isolation.

The following table provides a reconciliation of net investment income (the most comparable U.S. GAAP measure) to adjusted net investment income for the periods presented (dollars in thousands, except per share amounts; unaudited):

 

     For the three months ended      For the year ended  
     September 30, 2019      June 30, 2019      September 30, 2018      September 30, 2019      September 30, 2018  
($ in thousands, except per share data)    Amount      Per
Share
     Amount      Per
Share
     Amount      Per
Share
     Amount      Per
Share
     Amount      Per
Share
 

Net investment income

   $ 16,275      $ 0.12      $ 16,608      $ 0.12      $ 17,031      $ 0.12      $ 67,909      $ 0.48      $ 60,046      $ 0.43  

Part II incentive fee (net of waivers)

     438        —          685        —          —          —          1,123        0.01        —          —    
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Adjusted net investment income

   $ 16,713      $ 0.12      $ 17,293      $ 0.12      $ 17,031      $ 0.12      $ 69,032      $ 0.49      $ 60,046      $ 0.43  
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

 

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Conference Call Information

Oaktree Specialty Lending will host a conference call to discuss its fourth fiscal quarter and full year 2019 results at 11:00 a.m. Eastern Time / 8:00 a.m. Pacific Time on November 20, 2019. The conference call may be accessed by dialing (877) 507-3275 (U.S. callers) or +1 (412) 317-5238 (non-U.S. callers), participant password “Oaktree Specialty Lending.” During the earnings conference call, Oaktree Specialty Lending intends to refer to an investor presentation that will be available on the Investors section of the Oaktree Specialty Lending website, www.oaktreespecialtylending.com. Alternatively, a live webcast of the conference call can be accessed on Oaktree Specialty Lending’s website.

For those individuals unable to listen to the live broadcast of the conference call, a replay will be available on Oaktree Specialty Lending’s website, or by dialing (877) 344-7529 (U.S. callers) or +1 (412) 317-0088 (non-U.S. callers), access code 10135791, beginning approximately one hour after the broadcast.

About Oaktree Specialty Lending Corporation

Oaktree Specialty Lending Corporation (NASDAQ:OCSL) is a specialty finance company dedicated to providing customized one-stop credit solutions to companies with limited access to public or syndicated capital markets. The firm seeks to generate current income and capital appreciation by providing companies with flexible and innovative financing solutions including first and second lien loans, unsecured and mezzanine loans, and preferred equity. The Company is regulated as a business development company under the Investment Company Act of 1940, as amended. Oaktree Specialty Lending is managed by Oaktree Capital Management, L.P. For additional information, please visit Oaktree Specialty Lending’s website at www.oaktreespecialtylending.com.

Forward-Looking Statements

Some of the statements in this press release constitute forward-looking statements because they relate to future events or our future performance or financial condition. The forward-looking statements may include statements as to: our future operating results and distribution projections; our business prospects and the prospects of our portfolio companies; and the impact of the investments that we expect to make. In addition, words such as “anticipate,” “believe,” “expect,” “seek,” “plan,” “should,” “estimate,” “project” and “intend” indicate forward-looking statements, although not all forward-looking statements include these words. The forward-looking statements contained in this press release involve risks and uncertainties. Our actual results could differ materially from those implied or expressed in the forward-looking statements for any reason, including the factors set forth in “Risk Factors” and elsewhere in our annual report on Form 10-K and our quarterly reports on Form 10-Q. Other factors that could cause actual results to differ materially include: changes in the economy, financial markets and political environment; risks associated with possible disruption in our operations or the economy generally due to terrorism or natural disasters; future changes in laws or regulations (including the interpretation of these laws and regulations by regulatory authorities) and conditions in our operating areas, particularly with respect to business development companies or regulated investment companies; and other considerations that may be disclosed from time to time in our publicly disseminated documents and filings.

We have based the forward-looking statements included in this presentation on information available to us on the date of this presentation, and we assume no obligation to update any such forward-looking statements. Although we undertake no obligation to revise or update any forward-looking statements, whether as a result of new information, future events or otherwise, you are advised to consult any additional disclosures that we may make directly to you or through reports that we in the future may file with the SEC, including annual reports on Form 10-K, quarterly reports on Form 10-Q and current reports on Form 8-K.

Contacts

Investor Relations:

Oaktree Specialty Lending Corporation

Michael Mosticchio

(212) 284-1900

ocsl-ir@oaktreecapital.com

Media Relations:

Financial Profiles, Inc.

Moira Conlon

(310) 478-2700

mediainquiries@oaktreecapital.com

 

6


Oaktree Specialty Lending Corporation

Consolidated Statements of Assets and Liabilities

(in thousands, except per share amounts)

 

     September 30,
2019
    June 30,
2019
(unaudited)
    September 30,
2018
 
ASSETS       

Investments at fair value:

      

Control investments (cost September 30, 2019: $224,255; cost June 30, 2019: $190,181; cost September 30, 2018: $213,470)

   $ 209,178     $ 175,052     $ 196,874  

Affiliate investments (cost September 30, 2019: $8,449; cost June 30, 2019: $5,064; cost September 30, 2018: $1,080)

     9,170       5,964       2,161  

Non-control/Non-affiliate investments (cost September 30, 2019: $1,280,310; cost June 30, 2019: $1,337,252; cost September 30, 2018: $1,392,383)

     1,219,694       1,274,015       1,292,166  
  

 

 

   

 

 

   

 

 

 

Total investments at fair value (cost September 30, 2019: $1,513,014; cost June 30, 2019: $1,532,497; cost September 30, 2018: $1,606,933)

     1,438,042       1,455,031       1,491,201  

Cash and cash equivalents

     15,406       5,637       13,380  

Restricted cash

     —         —         109  

Interest, dividends and fees receivable

     11,167       13,156       10,272  

Due from portfolio companies

     2,616       1,850       1,357  

Receivables from unsettled transactions

     4,586       4       26,760  

Deferred financing costs

     6,396       6,759       5,209  

Derivative assets at fair value

     490       —         162  

Other assets

     2,335       2,579       3,008  
  

 

 

   

 

 

   

 

 

 

Total assets

   $ 1,481,038     $ 1,485,016     $ 1,551,458  
  

 

 

   

 

 

   

 

 

 
LIABILITIES AND NET ASSETS       

Liabilities:

      

Accounts payable, accrued expenses and other liabilities

   $ 1,589     $ 1,078     $ 3,581  

Base management fee and incentive fee payable

     10,167       9,987       8,223  

Due to affiliate

     2,689       3,431       3,274  

Interest payable

     2,296       2,267       3,365  

Payable to syndication partners

     —         —         109  

Payables from unsettled transactions

     59,596       —         37,236  

Derivative liability at fair value

     —         206       —    

Deferred tax liability

     704       719       422  

Credit facility payable

     314,825       369,825       241,000  

Unsecured notes payable (net of $2,708, $2,808 and $3,483 of unamortized financing costs as of September 30, 2019, June 30, 2019 and September 30, 2018, respectively)

     158,542       158,442       386,485  

Secured borrowings at fair value (proceeds September 30, 2019: $0; proceeds June 30, 2019: $11,502; proceeds September 30, 2018: $12,314)

     —         9,011       9,728  
  

 

 

   

 

 

   

 

 

 

Total liabilities

     550,408       554,966       693,423  
  

 

 

   

 

 

   

 

 

 

Commitments and contingencies

      

Net assets:

      

Common stock, $0.01 par value per share, 250,000 shares authorized; 140,961 shares issued and outstanding as of September 30, 2019, June 30, 2019 and September 30, 2018

     1,409       1,409       1,409  

Additional paid-in-capital

     1,487,774       1,492,739       1,492,739  

Accumulated overdistributed earnings

     (558,553     (564,098     (636,113
  

 

 

   

 

 

   

 

 

 

Total net assets (equivalent to $6.60, $6.60 and $6.09 per common share as of September 30, 2019, June 30, 2019 and September 30, 2018, respectively)

     930,630       930,050       858,035  
  

 

 

   

 

 

   

 

 

 

Total liabilities and net assets

   $ 1,481,038     $ 1,485,016     $ 1,551,458  
  

 

 

   

 

 

   

 

 

 

 

7


Oaktree Specialty Lending Corporation

Consolidated Statements of Operations

(in thousands, except per share amounts)

 

    Three months
ended
September 30, 2019
(unaudited)
    Three months
ended
June 30, 2019
(unaudited)
    Three months
ended
September 30, 2018
(unaudited)
    Year ended
September 30, 2019
    Year ended
September 30, 2018
 

Interest income:

         

Control investments

  $ 2,836     $ 2,859     $ 3,687     $ 11,886     $ 12,698  

Affiliate investments

    101       70       —         206       2,027  

Non-control/Non-affiliate investments

    27,640       29,850       31,496       120,888       103,223  

Interest on cash and cash equivalents

    85       131       123       690       563  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total interest income

    30,662       32,910       35,306       133,670       118,511  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

PIK interest income:

         

Control investments

    —         —         —         67       3,446  

Affiliate investments

    —         —         —         —         416  

Non-control/Non-affiliate investments

    1,187       1,198       499       5,430       1,907  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total PIK interest income

    1,187       1,198       499       5,497       5,769  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Fee income:

         

Control investments

    6       6       6       25       951  

Affiliate investments

    5       5       —         19       48  

Non-control/Non-affiliate investments

    2,539       1,815       2,028       6,666       8,433  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total fee income

    2,550       1,826       2,034       6,710       9,432  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Dividend income:

         

Control investments

    114       735       381       1,825       5,010  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total dividend income

    114       735       381       1,825       5,010  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total investment income

    34,513       36,669       38,220       147,702       138,722  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Expenses:

         

Base management fee

    5,496       5,548       5,767       22,343       22,652  

Part I incentive fee

    3,545       3,787       3,675       14,873       10,485  

Part II incentive fee

    (403     607       —         10,194       —    

Professional fees

    720       721       859       2,906       5,696  

Directors fees

    142       143       143       570       650  

Interest expense

    6,960       7,592       9,323       32,426       35,728  

Administrator expense

    388       384       336       1,941       1,687  

General and administrative expenses

    549       645       794       2,530       3,120  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total expenses

    17,397       19,427       20,897       87,783       80,018  

Fees waived

    841       634       292       (7,990     (1,342
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Net expenses

    18,238       20,061       21,189       79,793       78,676  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Net investment income

    16,275       16,608       17,031       67,909       60,046  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Unrealized appreciation (depreciation):

         

Control investments

    52       3,419       26,081       1,519       115,906  

Affiliate investments

    (179     —         —         (360     (2,159

Non-control/Non-affiliate investments

    2,621       20,744       21,039       39,689       (13,657

Secured borrowings

    (2,624     —         (87     (2,719     2,353  

Foreign currency forward contracts

    695       (768     162       328       162  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Net unrealized appreciation (depreciation)

    565       23,395       47,195       38,457       102,605  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Realized gains (losses):

         

Control investments

    —         —         (31,331     —         (122,801

Affiliate investments

    —         —         —         —         2,048  

Non-control/Non-affiliate investments

    (6,248     (21,112     1,494       15,300       6,042  

Secured borrowings

    2,625       —         —         2,625       —    

Foreign currency forward contracts

    1,097       1,268       (436     2,880       (436
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Net realized gains (losses)

    (2,526     (19,844     (30,273     20,805       (115,147
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Redemption premium on unsecured notes payable

    —         —         —         —         (120

Provision for income tax (expense) benefit

    (343     (173     (622     (1,011     (622
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Net realized and unrealized gains (losses), net of taxes

    (2,304     3,378       16,300       58,251       (13,284
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Net increase (decrease) in net assets resulting from operations

  $ 13,971     $ 19,986     $ 33,331     $ 126,160     $ 46,762  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Net investment income per common share — basic and diluted

  $ 0.12     $ 0.12     $ 0.12     $ 0.48     $ 0.43  

Earnings (loss) per common share — basic and diluted

  $ 0.10     $ 0.14     $ 0.24     $ 0.89     $ 0.33  

Weighted average common shares outstanding — basic and diluted

    140,961       140,961       140,961       140,961       140,961  

 

8