EX-99.1 2 ccap-ex99_1.htm EX-99.1 EX-99.1

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Crescent Capital BDC, Inc. Reports Second Quarter 2024 Earnings Results;
Declares a Third Quarter Base Dividend of $0.42 Per Share, and a Second Quarter Supplemental Dividend of $0.09 Per Share

 

LOS ANGELES, August 12, 2024 — Crescent Capital BDC, Inc. (“Crescent BDC” or “Company”) (NASDAQ: CCAP) today reported net investment income of $0.59 per share and net income of $0.55 per share for the quarter ended June 30, 2024. Net asset value per share increased to $20.30 compared to $20.28 as of March 31, 2024.

 

Dividend Declarations

The Company’s Board of Directors (the “Board”) declared a third quarter 2024 regular cash dividend of $0.42 per share to stockholders of record as of September 30, 2024, payable on October 15, 2024. The Board also announced a second quarter 2024 supplemental cash dividend of $0.09 per share to stockholders of record as of August 31, 2024, payable on September 16, 2024.

 

Selected Financial Highlights

($ in millions, except per share amounts)

 

As of and for the three months ended

 

 

 

June 30, 2024

 

 

March 31, 2024

 

 

June 30, 2023

 

 

Investments, at fair value

 

$

 

1,610.8

 

 

$

 

1,563.3

 

 

$

 

1,581.1

 

 

Total assets

 

$

 

1,672.4

 

 

$

 

1,620.4

 

 

$

 

1,624.6

 

 

Total net assets

 

$

 

752.4

 

 

$

 

751.7

 

 

$

 

725.8

 

 

Net asset value per share

 

$

 

20.30

 

 

$

 

20.28

 

 

$

 

19.58

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Investment income

 

$

 

48.9

 

 

$

 

50.4

 

 

$

 

46.7

 

 

Net investment income

 

$

 

21.7

 

 

$

 

23.4

 

 

$

 

20.6

 

 

Net realized gains (losses), net of taxes

 

$

 

(4.1

)

 

$

 

(0.2

)

 

$

 

(6.6

)

 

Net change in unrealized gains (losses), net of taxes

 

$

 

2.8

 

 

$

 

4.9

 

 

$

 

8.6

 

 

Net increase (decrease) in net assets resulting from operations

 

$

 

20.4

 

 

$

 

28.0

 

 

$

 

22.6

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net investment income per share

 

$

 

0.59

 

 

$

 

0.63

 

 

$

 

0.56

 

 

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

 

$

 

(0.11

)

 

$

 

(0.00

)

 

$

 

(0.18

)

 

Net change in unrealized gains (losses) per share, net of taxes

 

$

 

0.07

 

 

$

 

0.13

 

 

$

 

0.23

 

 

Net increase (decrease) in net assets resulting from operations per share

 

$

 

0.55

 

 

$

 

0.76

 

 

$

 

0.61

 

 

Regular distributions paid per share

 

$

 

0.42

 

 

$

 

0.41

 

 

$

 

0.41

 

 

Supplemental distributions paid per share

 

$

 

0.11

 

 

$

 

0.10

 

 

 

 

-

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Weighted average yield on income producing securities (at cost)1

 

 

 

12.2

%

 

 

 

12.3

%

 

 

 

11.7

%

 

Percentage of debt investments at floating rates

 

 

 

96.9

%

 

 

 

97.5

%

 

 

 

98.6

%

 

 

Portfolio & Investment Activity

As of June 30, 2024 and December 31, 2023, the Company had investments in 183 and 186 portfolio companies with an aggregate fair value of $1,610.8 and $1,582.1 million, respectively. The portfolio at fair value was comprised of the following asset types:

Portfolio Asset Types:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

As of

 

 

$ in millions

 

June 30, 2024

 

 

 

December 31, 2023

 

 

Investment Type

 

Fair Value

 

 

Percentage

 

 

 

Fair Value

 

 

Percentage

 

 

Senior secured first lien

 

$

 

432.9

 

 

 

26.8

 

%

 

$

 

429.2

 

 

 

27.0

 

%

Unitranche first lien2

 

 

1,005.3

 

 

 

62.4

 

 

 

 

 

973.9

 

 

 

61.5

 

 

Unitranche first lien - last out2

 

 

5.6

 

 

 

0.3

 

 

 

 

 

13.5

 

 

 

0.9

 

 

Senior secured second lien

 

 

49.5

 

 

 

3.1

 

 

 

 

 

58.2

 

 

 

3.7

 

 

Unsecured debt

 

 

15.6

 

 

 

1.0

 

 

 

 

 

4.1

 

 

 

0.3

 

 

Equity & other

 

 

57.2

 

 

 

3.6

 

 

 

 

 

50.1

 

 

 

3.2

 

 

LLC/LP equity interests

 

 

44.7

 

 

 

2.8

 

 

 

 

 

53.1

 

 

 

3.4

 

 

Total investments

 

$

 

1,610.8

 

 

 

100.0

 

%

 

$

 

1,582.1

 

 

 

100.0

 

%

For the quarter ended June 30, 2024, the Company invested $119.3 million across six new portfolio companies and several follow-on revolver and delayed draw fundings. During this period, the Company had $73.4 million in aggregate exits, sales and repayments. For the quarter ended March 31, 2024, the Company invested $73.9 million across seven new portfolio companies and several follow-on revolver and delayed draw fundings. During this period, the Company had $98.4 million in aggregate exits, sales and repayments.

 

 

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Results of Operations

For the quarter ended June 30, 2024 and 2023, investment income was $48.9 million and $46.7 million, respectively. The increase in investment income was largely the result of net funding activity and an increase in reference rates. Net expenses, including income and excise taxes, totaled $27.2 million and $26.1 million for the quarter ended June 30, 2024 and 2023, respectively. The increase in net expenses was primarily due to an increase in reference rates which increased the Company's weighted average interest rate on debt outstanding.

Liquidity and Capital Resources

As of June 30, 2024, the Company had $36.1 million in cash and cash equivalents and restricted cash and $293.8 million of undrawn capacity on its credit facilities, subject to borrowing base and other limitations. The weighted average cost of debt on the Company’s debt outstanding as of June 30, 2024 was 7.26%.

The Company’s debt to equity ratio was 1.18x as of June 30, 2024.

Conference Call

The Company will host a webcast/conference call on Tuesday, August 13, 2024 at 12:00 p.m. (Eastern Time) to discuss its financial results for the quarter ended June 30, 2024. Please visit Crescent BDC’s webcast link located on the Events & Presentations page of the Investor Relations section of Crescent BDC’s website for a slide presentation that complements the earnings conference call.

All interested parties are invited to participate via telephone or the live webcast, which will be hosted on a webcast link located on the Events & Presentations page of the Investor Resources section of Crescent BDC’s website at www.crescentbdc.com. Please visit the website to test your connection before the webcast. Participants are also invited to access the conference call by dialing the following number:

Toll Free: (800) 267-6316

Conference ID: CRESCENT

All callers will need to reference the Conference ID once connected with the operator. An archived replay will be available via a webcast link located on the Investor Relations section of Crescent BDC's website.

 

Endnotes

Note: Numbers may not sum due to rounding.

1)
Yield includes performing debt and other income producing investments (excluding investments on non-accrual).
2)
Unitranche loans are first lien loans that may extend deeper in a company’s capital structure than traditional first lien debt and may provide for a waterfall of cash flow priority among different lenders in the unitranche loan. In certain instances, the Company may find another lender to provide the “first out” portion of such loan and retain the “last out” portion of such loan, in which case, the “first out” portion of the loan would generally receive priority with respect to payment of principal, interest and any other amounts due thereunder over the “last out” portion that the Company would continue to hold. In exchange for the greater risk of loss, the “last out” portion earns a higher interest rate.

 

 

 

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Crescent Capital BDC, Inc.

Consolidated Statements of Assets and Liabilities

(in thousands except share and per share data)

 

 

As of
June 30, 2024

 

 

As of
December 31, 2023

 

Assets

 

 

 

 

 

Investments, at fair value

 

 

 

 

 

Non-controlled non-affiliated investments (cost of$1,493,976 and $1,469,251, respectively)

$

1,501,420

 

 

$

1,465,537

 

Non-controlled affiliated investments (cost of $54,294 and $56,084, respectively)

 

52,023

 

 

 

52,619

 

Controlled investments (cost of $64,619 and $67,353, respectively)

 

57,332

 

 

 

63,919

 

Cash and cash equivalents

 

11,018

 

 

 

7,780

 

Restricted cash and cash equivalents

 

25,124

 

 

 

16,690

 

Interest and dividend receivable

 

16,089

 

 

 

14,000

 

Receivable from unsettled transactions

 

2,549

 

 

 

251

 

Unrealized appreciation on foreign currency forward contracts

 

2,765

 

 

 

5,128

 

Deferred tax assets

 

939

 

 

 

114

 

Other assets

 

3,173

 

 

 

1,341

 

Total assets

$

1,672,432

 

 

$

1,627,379

 

 

 

 

 

 

 

Liabilities

 

 

 

 

 

Debt (net of deferred financing costs of $7,903 and $7,138)

$

879,934

 

 

$

844,783

 

Distributions payable

 

15,566

 

 

 

15,195

 

Interest and other debt financing costs payable

 

11,038

 

 

 

10,900

 

Management fees payable

 

5,001

 

 

 

5,026

 

Incentive fees payable

 

4,603

 

 

 

4,770

 

Deferred tax liabilities

 

883

 

 

 

578

 

Unrealized depreciation on foreign currency forward contracts

 

42

 

 

 

84

 

Accrued expenses and other liabilities

 

2,925

 

 

 

3,449

 

Total liabilities

$

919,992

 

 

$

884,785

 

 

 

 

 

 

Net assets

 

 

 

 

 

Preferred stock, par value $0.001 per share (10,000 shares authorized,
zero outstanding, respectively)

$

-

 

 

$

-

 

Common stock, par value $0.001 per share (200,000,000 shares authorized,
37,061,547 and 30,887,360 shares issued and outstanding, respectively)

 

37

 

 

 

37

 

Paid-in capital in excess of par value

 

965,895

 

 

 

788,299

 

Accumulated earnings (loss)

 

(213,492

)

 

 

(45,742

)

Total net assets

$

752,440

 

 

$

742,594

 

Total liabilities and net assets

$

1,672,432

 

 

$

1,627,379

 

Net asset value per share

$

20.30

 

 

$

20.04

 

 

 

 

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Crescent Capital BDC, Inc.

Consolidated Statements of Operations

(in thousands except share and per share data)
(Unaudited)

 

 

 

For the three months ended June 30,

 

 

For the six months ended June 30,

 

 

 

 

2024

 

 

 

2023

 

 

 

2024

 

 

 

2023

 

Investment Income:

 

 

 

 

 

 

 

 

 

 

 

 

From non-controlled non-affiliated investments:

 

 

 

 

 

 

 

 

 

 

 

 

Interest income

 

$

41,973

 

 

$

41,255

 

 

$

85,536

 

 

$

75,501

 

Paid-in-kind interest

 

 

2,060

 

 

 

650

 

 

 

3,215

 

 

 

1,268

 

Dividend income

 

 

2

 

 

 

75

 

 

 

395

 

 

 

79

 

Other income

 

 

779

 

 

 

181

 

 

 

1,667

 

 

 

228

 

From non-controlled affiliated investments:

 

 

 

 

 

 

 

 

 

 

 

 

Interest income

 

 

1,099

 

 

 

740

 

 

 

1,791

 

 

 

1,352

 

Paid-in-kind interest

 

 

67

 

 

 

186

 

 

 

509

 

 

 

235

 

Dividend income

 

 

—

 

 

 

551

 

 

 

287

 

 

 

1,179

 

Other income

 

 

16

 

 

 

149

 

 

 

16

 

 

 

149

 

From controlled investments:

 

 

 

 

 

 

 

 

 

 

 

 

Interest income

 

 

312

 

 

 

154

 

 

 

611

 

 

 

320

 

Paid-in-kind interest

 

 

—

 

 

 

—

 

 

 

—

 

 

 

192

 

Dividend income

 

 

2,640

 

 

 

2,800

 

 

 

5,280

 

 

 

5,520

 

Other income

 

 

3

 

 

 

—

 

 

 

5

 

 

 

—

 

Total investment income

 

 

48,951

 

 

 

46,741

 

 

 

99,312

 

 

 

86,023

 

 

 

 

 

 

 

 

 

 

 

 

 

Expenses:

 

 

 

 

 

 

 

 

 

 

 

 

Interest and other debt financing costs

 

 

15,931

 

 

 

15,273

 

 

 

31,535

 

 

 

27,642

 

Management fees

 

 

5,034

 

 

 

5,010

 

 

 

10,014

 

 

 

9,468

 

Income based incentive fees

 

 

4,603

 

 

 

4,349

 

 

 

9,541

 

 

 

8,041

 

Professional fees

 

 

451

 

 

 

427

 

 

 

897

 

 

 

737

 

Directors’ fees

 

 

151

 

 

 

138

 

 

 

308

 

 

 

306

 

Other general and administrative expenses

 

 

678

 

 

 

753

 

 

 

1,305

 

 

 

1,478

 

Total expenses

 

 

26,848

 

 

 

25,950

 

 

 

53,600

 

 

 

47,672

 

Management fees waiver

 

 

(33

)

 

 

(50

)

 

 

(71

)

 

 

(96

)

Income based incentive fees waiver

 

 

—

 

 

 

(71

)

 

 

(36

)

 

 

(159

)

Net expenses

 

 

26,815

 

 

 

25,829

 

 

 

53,493

 

 

 

47,417

 

Net investment income before taxes

 

 

22,136

 

 

 

20,912

 

 

 

45,819

 

 

 

38,606

 

(Benefit) provision for income and excise taxes

 

 

433

 

 

 

340

 

 

 

800

 

 

 

541

 

Net investment income

 

 

21,703

 

 

 

20,572

 

 

 

45,019

 

 

 

38,065

 

Net realized and unrealized gains (losses) on investments:

 

 

 

 

 

 

 

 

 

 

 

 

Net realized gain (loss) on:

 

 

 

 

 

 

 

 

 

 

 

 

Non-controlled non-affiliated investments

 

 

(5,332

)

 

 

(6,494

)

 

 

(6,935

)

 

 

(6,243

)

Foreign currency transactions

 

 

(508

)

 

 

(58

)

 

 

(519

)

 

 

(58

)

Foreign currency forward contracts

 

 

1,776

 

 

 

—

 

 

 

3,223

 

 

 

—

 

Net change in unrealized appreciation (depreciation) on:

 

 

 

 

 

 

 

 

 

 

 

 

Non-controlled non-affiliated investments and foreign currency translation

 

 

7,191

 

 

 

10,010

 

 

 

12,061

 

 

 

4,456

 

Non-controlled affiliated investments

 

 

966

 

 

 

174

 

 

 

1,194

 

 

 

539

 

Controlled investments

 

 

(3,628

)

 

 

(1,641

)

 

 

(3,853

)

 

 

(5,970

)

Foreign currency forward contracts

 

 

(1,964

)

 

 

(578

)

 

 

(2,320

)

 

 

(1,239

)

Net realized and unrealized gains (losses) on investments

 

 

(1,499

)

 

 

1,413

 

 

 

2,851

 

 

 

(8,515

)

Benefit (provision) for taxes on realized gain on investments

 

 

—

 

 

 

—

 

 

 

—

 

 

 

252

 

Benefit (provision) for taxes on unrealized appreciation (depreciation) on investments

 

 

181

 

 

 

595

 

 

 

520

 

 

 

555

 

Net increase (decrease) in net assets resulting from operations

 

$

20,385

 

 

$

22,580

 

 

$

48,390

 

 

$

30,357

 

 

 

 

 

 

 

 

 

 

 

 

 

Per common share data:

 

 

 

 

 

 

 

 

 

 

 

 

Net increase (decrease) in net assets resulting from operations per share (basic and diluted):

 

$

0.55

 

 

$

0.61

 

 

$

1.31

 

 

$

0.87

 

Net investment income per share (basic and diluted):

 

$

0.59

 

 

$

0.56

 

 

$

1.21

 

 

$

1.09

 

Weighted average shares outstanding (basic and diluted):

 

 

37,061,547

 

 

 

37,061,547

 

 

 

37,061,547

 

 

 

34,776,074

 

 

 

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About Crescent BDC

Crescent BDC is a business development company that seeks to maximize the total return of its stockholders in the form of current income and capital appreciation by providing capital solutions to middle market companies with sound business fundamentals and strong growth prospects. Crescent BDC utilizes the extensive experience, origination capabilities and disciplined investment process of Crescent. Crescent BDC is externally managed by Crescent Cap Advisors, LLC, a subsidiary of Crescent. Crescent BDC has elected to be regulated as a business development company under the Investment Company Act of 1940. For more information about Crescent BDC, visit www.crescentbdc.com. However, the contents of such website are not and should not be deemed to be incorporated by reference herein.

About Crescent Capital Group

Crescent is a global credit investment manager with over $42 billion of assets under management. For over 30 years, the firm has focused on below investment grade credit through strategies that invest in marketable and privately originated debt securities including senior bank loans, high yield bonds, as well as private senior, unitranche and junior debt securities. Crescent is headquartered in Los Angeles with offices in New York, Boston, Chicago and London with more than 225 employees globally. Crescent is a part of SLC Management, the institutional alternatives and traditional asset management business of Sun Life. For more information about Crescent, visit www.crescentcap.com. However, the contents of such website are not and should not be deemed to be incorporated by reference herein.

Contact:

Dan McMahon

daniel.mcmahon@crescentcap.com

212-364-0149

Forward-Looking Statements

This press release, and other statements that Crescent BDC may make, may contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act, with respect to Crescent BDC’s future financial or business performance, strategies or expectations. Forward-looking statements are typically identified by words or phrases such as “trend,” “potential,” “opportunity,” “pipeline,” “believe,” “comfortable,” “expect,” “anticipate,” “current,” “intention,” “estimate,” “position,” “assume,” “outlook,” “continue,” “remain,” “maintain,” “sustain,” “seek,” “achieve,” and similar expressions, or future or conditional verbs such as “will,” “would,” “should,” “could,” “may” or similar expressions.

Crescent BDC cautions that forward-looking statements are subject to numerous assumptions, risks and uncertainties, which may change over time. Forward-looking statements speak only as of the date they are made, and Crescent BDC assumes no duty to and does not undertake to update forward-looking statements. Actual results could differ materially from those anticipated in forward-looking statements and future results could differ materially from historical performance.

In addition to factors previously disclosed in Crescent BDC’s SEC reports and those identified elsewhere in this press release, the following factors, among others, could cause actual results to differ materially from forward-looking statements or historical performance: (1) our future operating results; (2) our business prospects and the prospects of our portfolio companies; (3) the impact of investments that we expect to make; (4) our contractual arrangements and relationships with third parties; (5) the dependence of our future success on the general economy and its impact on the industries in which we invest; (6) the financial condition of and ability of our current and prospective portfolio companies to achieve their objectives; (7) our expected financings and investments; (8) the adequacy of our cash resources and working capital, including our ability to obtain continued financing on favorable terms; (9) the timing of cash flows, if any, from the operations of our portfolio companies; (10) the impact of increased competition; (11) the ability of our investment adviser to locate suitable investments for us and to monitor and administer our investments; (12) potential conflicts of interest in the allocation of opportunities between us and other investment funds managed by our investment adviser or its affiliates; (13) the ability of our investment adviser to attract and retain highly talented professionals; (14) changes in law and policy accompanying the new administration and uncertainty pending any such changes; (15) increased geopolitical unrest, terrorist attacks or acts of war, which may adversely affect the general economy, domestic and local financial and capital markets, or the specific industries of our portfolio companies; (16) changes and volatility in political, economic or industry conditions, the interest rate environment, foreign exchange rates or financial and capital markets; (17) the unfavorable resolution of legal proceedings; and (18) the impact of changes to tax legislation and, generally, our tax position.

Crescent BDC’s Annual Report on Form 10-K for the year ended December 31, 2023, filed with the SEC, identifies additional factors that can affect forward-looking statements.

 

Other Information

The information in this press release is summary information only and should be read in conjunction with Crescent BDC’s annual report on Form 10-K for the year ended December 31, 2023, which Crescent BDC filed with the U.S. Securities and Exchange Commission (the SEC) on February 21, 2024, as well as Crescent BDC’s other reports filed with the SEC. A copy of Crescent BDC’s annual report on Form 10-K for the year ended December 31, 2023, Crescent BDC’s quarterly reports on Form 10-Q and Crescent BDC’s other reports filed with the SEC can be found on Crescent BDC’s website at www.crescentbdc.com and the SEC’s website at www.sec.gov.