- GAAP Net Investment Income (“NII”) was $8.1 million, or $0.11
per share in the fourth quarter, representing a 6% increase from
third quarter NII of $7.7 million. Fourth quarter NII provided
dividend coverage of 112%, up from third quarter dividend coverage
of 105%. NII for the fourth quarter includes fee and other one-time
income of approximately $0.01 per share, as compared to $0.02 per
share in the prior quarter.
- Net Asset Value (“NAV”) decreased to $318.5 million as of
December 31, 2022, down 4.1% from $332.0 million as of
September 30, 2022; NAV per share decreased by 3.7% to $4.39 per
share from $4.56 per share as of September 30, 2022, primarily
driven by net unrealized losses of $13.2 million during the quarter
due to credit spread widening across the broader market and other
portfolio valuation declines.
- The Company had gross deployments totaling $36.0 million during
the fourth quarter, substantially all of which were in first lien
loans. The weighted average yield on gross deployments during the
quarter was 11.5%, up from 10.0% in the third quarter. During the
quarter, 8 new portfolio companies were added, bringing total
portfolio companies at quarter-end to 116, up from 86 at the end of
2021 and 55 at the end of 2020. Gross repayments during the fourth
quarter were $27.9 million, including full repayments from 3
existing portfolio companies.
- The Company’s weighted-average portfolio yield as of
December 31, 2022 increased to 11.9% based on total portfolio
fair value, up from 10.5% as of September 30, 2022. The increase
was largely driven by a rise in LIBOR and SOFR rates during the
quarter.
- Net leverage was 0.77x as of December 31, 2022, up from
0.71x as of September 30, 2022, driven by new net deployments and a
decrease in valuations across our portfolio. Total available
liquidity for deployment into portfolio company investments,
including cash, was approximately $112.5 million, subject to
leverage and borrowing base restrictions.
- During the fourth quarter, the Company repurchased 318,324
shares under the share repurchase program, spending approximately
$1.2 million at an average price of $3.62 per share, including
brokerage commissions.
BlackRock Capital Investment Corporation (NASDAQ:BKCC) (“BCIC”
or the “Company,” “we,” “us” or “our”) announced today that its
Board of Directors declared a quarterly dividend of $0.10 per
share, payable on April 6, 2023 to stockholders of record at the
close of business on March 16, 2023.
“Our NII continued its upward trajectory this quarter,
demonstrating the strength of our increasingly diversified
portfolio and our commitment to delivering solid risk-adjusted
returns,” said James E. Keenan, Chairman and Interim CEO of the
Company. “We are very pleased that our NII covered our $0.10
dividend by 112% this quarter. Higher base rates and an improved
pricing environment on new originations contributed to a 6%
increase in NII from the prior quarter. Our relatively modest
leverage ratio of 0.77x allows us the flexibility to selectively
grow our portfolio and further increase its earnings power."
“The fourth quarter witnessed reduced origination activity
across the market as corporate mergers and acquisitions, the need
for growth financings as well as refinancing activity slowed down
owing to a rising interest rate environment. Even during this
slower environment, we added 8 new portfolio companies during the
quarter, drawing upon the power of the BlackRock platform. We ended
the year with a well-diversified portfolio of 116 companies, more
than doubling the number of portfolio companies we had at the end
of 2020. We deployed $36 million in the fourth quarter on a gross
basis – almost entirely in first lien loans. At the end of the
year, 79% of our portfolio consisted of first lien investments, up
from 74% at the end of 2021 and 50% at the end of 2020,
representing significant progress in our effort to lower the risk
profile of the portfolio over that time frame. Subsequent to the
fourth quarter, we exited and realized our non-core legacy
investments in Advanced Lighting (previously a non-accrual asset)
and Kemmerer Operations, reducing our non-core exposure to less
than 1% of the portfolio on a pro forma basis,” Mr. Keenan
continued.
“Against the macroeconomic backdrop of continued inflation,
higher interest rates, and softening consumer demand, we remain
highly selective in underwriting new investments and vigilant in
monitoring our existing portfolio. We believe that our portfolio is
well positioned to withstand the impact of a deteriorating economic
environment. Our credit quality remains solid as there were no new
non-accrual investments in the fourth quarter, demonstrating our
focus on prudent underwriting and maintaining a strong credit
culture.” Mr. Keenan concluded.
December 31, 2022
September 30, 2022
December 31, 2021
December 31, 2020
Portfolio Composition
First Lien Debt
79%
77%
74%
50%
Second Lien Debt
16%
17%
19%
27%
Junior Capital1
5%
6%
7%
23%
Portfolio Company Count
116
111
86
55
Non-Core
Assets
Portfolio Company Count2
3
4
5
6
Fair Market Value ("FMV", in Millions)
9
11
26
42
% of investments, at FMV
2%
2%
5%
9%
__________________________________________
- Includes unsecured/subordinated debt and equity
investments.
- Excludes portfolio companies with zero FMV.
Financial Highlights
Q4 2022
Q3 2022
Q4 2021
($'s in millions, except per share
data)2
Total Amount
Per Share
Total Amount
Per Share
Total Amount
Per Share
Net Investment Income/(loss)
$8.1
$0.11
$7.7
$0.10
$5.9
$0.08
Net realized and unrealized
gains/(losses)
$(13.2)
$(0.18)
$(2.1)
$(0.03)
$0.7
$0.01
Basic earnings/(losses)
$(5.1)
$(0.07)
$5.6
$0.08
$6.7
$0.09
Dividends declared
$7.3
$0.10
$7.3
$0.10
$7.4
$0.10
Net Investment Income/(loss), as
adjusted1
$8.1
$0.11
$7.7
$0.10
$6.2
$0.08
Basic earnings/(losses), as adjusted1
$(5.1)
$(0.07)
$5.6
$0.08
$6.9
$0.09
__________________________________________
- Non-GAAP basis financial measure, excluding the hypothetical
liquidation basis capital gain incentive fee accrual (reversal), if
any, under GAAP. See Supplemental Information.
- Totals may not foot due to rounding.
2022 Totals
2021 Totals
($'s in millions, except per share
data)
Total Amount
Per Share
Total Amount
Per Share
Net Investment Income/(loss)
$29.4
$0.40
$19.9
$0.27
Net realized and unrealized
gains/(losses)
$(25.9)
$(0.35)
$46.6
$0.63
Basic earnings/(losses)
$3.5
$0.05
$66.5
$0.90
Dividends declared
$(29.3)
$0.40
$29.7
$0.40
Net Investment Income/(loss), as
adjusted1
$27.8
$0.38
$21.4
$0.29
Basic earnings/(losses), as adjusted1
$1.9
$0.03
$68.0
$0.92
__________________________________________
- Non-GAAP basis financial measure, excluding the hypothetical
liquidation basis capital gain incentive fee accrual (reversal), if
any, under GAAP. See Supplemental Information.
($'s in millions, except per share
data)
December 31, 2022
September 30, 2022
December 31, 2021
Total assets
$589.1
$612.0
$572.0
Investment portfolio, at FMV
$570.5
$574.6
$552.6
Debt outstanding
$253.0
$260.9
$196.9
Total net assets
$318.5
$332.0
$349.7
Net asset value per share
$4.39
$4.56
$4.73
Net leverage ratio1
0.77x
0.71x
0.56x
__________________________________________
- Calculated as the ratio between (a) debt, excluding unamortized
debt issuance costs, less available cash and receivable for
investments sold, plus payables for investments purchased, and (b)
NAV.
Business Updates
- Reduced Exposure in Non-Core Legacy
Portfolio: During the fourth quarter, the Company
received $1.0 million of proceeds from a partial repayment of our
first lien term loan in Kemmerer Operations, LLC ("Kemmerer
Operations"). The non-core portfolio stood at less than 2% of our
entire portfolio, at fair value, as of December 31, 2022.
Subsequent to December 31, 2022, the Company received $2.4 million
in proceeds from the full sale of its first lien debt and equity
positions in Kemmerer Operations, and $0.8 million in proceeds from
the full sale of its non-accrual second lien secured note position
in Advanced Lighting Technologies, LLC ("Advanced Lighting"),
further reducing the Company's non-core legacy exposure.
- Other Junior Capital
Exposure: As of December 31, 2022, the Company’s other
junior capital (including unsecured/subordinated debt and equity)
exposure, excluding non-core assets, remained low at 4% of the
portfolio, down from 6% at December 31, 2021, and down from 21% at
December 31, 2020.
- Share Repurchase Program:
During the fourth quarter, the Company repurchased 318,324 shares
of its common stock for $1.2 million at an average price of $3.62
per share, including brokerage commissions. On October 28, 2022,
the Company’s Board of Directors authorized the Company to purchase
up to a total of 8 million shares, commencing on November 7, 2022
and effective until the earlier of November 6, 2023 or such time
that all of the authorized shares have been repurchased, subject to
the terms of a share repurchase program, if in effect.
Fourth Quarter Financial Updates
- NII was $8.1 million, or approximately $0.11 per share, for the
three months ended December 31, 2022, an increase of 6% from the
prior quarter. Relative to our dividend declared of $0.10 per
share, dividend coverage was 112%, up from 105% in the prior
quarter.
- NAV decreased to $318.5 million at December 31, 2022, down 4.1%
from $332.0 million at September 30, 2022; NAV per share decreased
to $4.39 per share from $4.56 per share as of September 30, 2022.
The NAV decrease was primarily driven by $13.2 million of net
unrealized losses due to credit spread widening across the broader
market and other portfolio valuation declines.
- Tax characteristics of all 2022 dividends were reported to
stockholders on Form 1099 after the end of the calendar year. Our
2022 aggregate dividends of $0.40 per share included a $0.02 per
share return of capital. At our discretion, we may carry forward
taxable income in excess of calendar year dividends and pay a 4%
excise tax on this income. We will accrue excise tax on estimated
undistributed taxable income as required. There was no
undistributed taxable income carried forward from 2022, and
therefore no excise tax payable at December 31, 2022.
Portfolio and Investment Activity*
($’s in millions)
Three Months Ended
Year Ended
December 31, 2022
December 31, 2021
December 31, 2022
December 31, 2021
Investment deployments
$36.0
$68.5
$231.5
$275.0
Investment exits
$27.9
$75.7
$192.4
$250.6
Number of portfolio company investments at
the end of period
116
86
116
86
Weighted average yield of debt and income
producing equity securities, at FMV
12.0%
8.7%
12.0%
8.7%
% of Portfolio invested in Secured debt,
at FMV
94%
93%
94%
93%
% of Portfolio invested in
Unsecured/subordinated debt, at FMV
4%
5%
4%
5%
% of Portfolio invested in Equity, at
FMV
2%
2%
2%
2%
Average investment by portfolio company,
at amortized cost
$5.7
$7.1
$5.7
$7.1
__________________________________________
*Balance sheet amounts and yield
information above are as of period end.
- We deployed $36.0 million during the quarter while exits and
repayments totaled $27.9 million, resulting in an $8.1 million net
increase in our portfolio.
- Deployments consisted of investments/fundings into 8 new
portfolio companies and primarily 7 existing portfolio companies,
which are outlined as follows: New Portfolio Companies
- $5.2 million SOFR ("S") + 6.50% first lien term loan and $5.2
million unfunded revolver to Integrity Marketing Acquisition, LLC,
an independent marketer and distributor of life and health
insurance products;
- $5.2 million S + 6.50% first lien term loan, $1.3 million
unfunded delayed draw term loan ("DDTL"), and $0.5 million unfunded
revolver to Zendesk, Inc., a provider of customer support solutions
to businesses;
- $5.0 million S + 7.00% first lien term loan and $0.4 million
unfunded revolver to Madison Logic Holdings, Inc., a
business-to-business marketing services provider;
- $2.6 million S + 8.25% first lien term loan to Money Transfer
Acquisition Inc., a consumer financial services company;
- $2.3 million S + 7.25% first lien term loan and $0.2 million
unfunded revolver to Avalara, Inc., a provider of cloud-based
solutions for transaction tax compliance;
- $2.2 million S + 7.00% first lien term loan, $0.2 million
unfunded DDTL, and $0.3 million unfunded revolver to Alcami
Corporation, a contract drug development and manufacturing
organization;
- $2.2 million S + 6.25% first lien term loan to CommerceHub,
Inc., a provider of cloud-based ecommerce solutions; and
- $2.1 million S + 8.75% first lien term loan to Kong Inc., a
software provider for managing, scaling and monitoring application
processing interfaces. Incremental Investment
/Funding Primarily in the Following Existing Portfolio
Companies
- $2.9 million S + 6.00% first lien DDTL funding to Wealth
Enhancement Group, LLC;
- $1.5 million S + 6.88% first lien DDTL funding to GTY
Technology Holdings, Inc.;
- $1.0 million S + 7.50% first lien DDTL funding to Elastic Path
Software Inc.;
- $0.9 million S + 7.25% first lien DDTL funding to Grey Orange
Incorporated;
- $0.7 million S + 5.75% first lien DDTL funding to AmeriLife
Holdings, LLC;
- $0.7 million 12.00% first lien term loan to Magenta Buyer, LLC
(McAfee); and
- $0.5 million LIBOR + 8.00% first lien revolver funding to
Pluralsight, Inc.
- Exits and repayments were primarily concentrated in three
complete exits of portfolio company investments and two partial
paydowns, with a total of $0.5 million in fee and other one-time
income generated in excess of principal repaid on these
transactions:
- $11.7 million full repayment at par of first lien term loan in
Barri Financial Group, LLC;
- $9.2 million of proceeds from the full repayment at par of
first lien term loan, DDTL and revolver in Unanet, Inc.;
- $4.3 million of proceeds from the full repayment at par of
second lien term loan and DDTL in MetroNet Systems Holdings,
LLC;
- $1.0 million of proceeds from the partial repayment of first
lien term loan in Kemmerer Operations, a non-core legacy position;
and
- $0.6 million of proceeds from the partial repayment of first
lien term loan and revolver in Alpine Acquisition Corp II
(48Forty).
- During the quarter ended December 31, 2022, there were no
new non-accrual investments. As of December 31, 2022, there
were three non-accrual investment positions, representing
approximately 2.8% and 11.8% of total debt and preferred stock
investments, at fair value and cost, respectively. Subsequent to
December 31, 2022, the Company received $0.8 million in proceeds
from the full sale of its non-accrual debt position in Advanced
Lighting, further reducing its number of non-accrual investment
positions to two.
- The weighted average internal investment rating of the
portfolio at FMV declined slightly to 1.33 at December 31,
2022, as compared to 1.28 at September 30, 2022, and 1.21 at
December 31, 2021.
- During the quarter ended December 31, 2022, net unrealized
losses were $13.2 million, driven by credit spread widening across
the broader market and other portfolio valuation declines. The
largest contributors to the unrealized losses included Gordon
Brothers Finance Company, Razor Group GmbH, Magenta Buyer, LLC,
Stitch Holdings L.P. and MBS Parent, LLC. There were no realized
gains or losses during the quarter.
Liquidity and Capital Resources
- At December 31, 2022, we had $9.5 million in cash and cash
equivalents and $103.0 million of availability under our credit
facility, subject to leverage restrictions, resulting in
approximately $112.5 million of availability for deployment into
portfolio company investments including current unfunded
commitments, and for general use in the normal course of
business.
- Net leverage, adjusted for available cash, receivables for
investments sold, payables for investments purchased and
unamortized debt issuance costs, was 0.77x at quarter-end, and our
225% asset coverage ratio provided the Company with additional debt
capacity of $103.0 million under its asset coverage requirements,
subject to borrowing capacity and borrowing base restrictions.
Further, as of December 31, 2022, approximately 85% of our
assets were invested in qualifying assets, exceeding the 70%
requirement for a business development company under Section 55(a)
of the Investment Company Act of 1940.
- For the fourth quarter of 2022, the Company declared a cash
dividend of $0.10 per share, payable on April 6, 2023 to
stockholders of record at the close of business on March 16,
2023.
Conference Call
BlackRock Capital Investment Corporation will host a
webcast/teleconference at 10:00 a.m. (Eastern Time) on Thursday,
March 2, 2023, to discuss its fourth quarter 2022 financial
results. All interested parties are welcome to participate. You can
access the teleconference by dialing, from the United States, (844)
394-5144 or from outside the United States, +1 (773) 305-6865, 10
minutes before 10:00 a.m. and referencing the BlackRock Capital
Investment Corporation Conference Call (ID Number 9602125). A live,
listen-only webcast will also be available via the Investor
Relations section of www.blackrockbkcc.com. This teleconference can
also be accessed using Microsoft Edge, Google Chrome, or Firefox
via this link: BlackRock Capital Investment Corporation Fourth
Quarter 2022 Earnings Call. Once clicked-on, please enter your
information to be connected. Please note that the link becomes
active fifteen minutes prior to the scheduled start time.
The teleconference and the webcast will be available for replay
by 3:00 p.m. on Thursday, March 2, 2023 and ending at 3:00 p.m. on
Thursday, March 16, 2023. The replay of the teleconference can be
accessed via the following link: BlackRock Capital Investment
Corporation Fourth Quarter 2022 Earnings Call Replay. To access the
webcast, please visit the investor relations section of
www.blackrockbkcc.com.
Prior to the webcast/teleconference, an investor presentation
that complements the earnings conference call will be posted to
BlackRock Capital Investment Corporation’s website within the
Presentations section of the Investors page.
About BlackRock Capital Investment Corporation
Formed in 2005, BlackRock Capital Investment Corporation is a
business development company that provides debt and equity capital
to middle-market companies.
The Company's investment objective is to generate both current
income and capital appreciation through debt and equity
investments. We invest primarily in middle-market companies in the
form of senior debt securities and loans, and our investment
portfolio may include junior secured and unsecured debt securities
and loans, each of which may include an equity component.
BlackRock Capital Investment Corporation
Consolidated Statements of Assets and Liabilities
December 31, 2022
December 31, 2021
Assets
Investments at fair value:
Non-controlled, non-affiliated investments
(cost of $569,528,145 and $520,501,274)
$551,686,646
$526,504,945
Non-controlled, affiliated investments
(cost of $3,849,638 and $5,027,616)
3,574,438
4,131,978
Controlled investments (cost of
$84,922,381 and $89,097,765)
15,228,000
21,927,071
Total investments at fair value (cost of
$658,300,164 and $614,626,655)
570,489,084
552,563,994
Cash and cash equivalents
9,531,190
12,750,121
Interest, dividends and fees
receivable
5,515,446
3,671,722
Due from broker
1,946,507
—
Deferred debt issuance costs
1,055,117
1,511,418
Receivable for investments sold
12,096
690,550
Prepaid expenses and other assets
510,706
788,469
Total assets
$589,060,146
$571,976,274
Liabilities
Debt (net of deferred issuance costs of
$996,839 and $425,272)
$253,003,161
$196,875,330
Dividends payable
7,257,191
7,392,972
Income incentive fees payable
3,403,349
170,002
Accrued capital gains incentive fees
—
1,544,569
Management fees payable
2,186,540
2,122,519
Interest Rate Swap at fair value
1,332,299
—
Interest and debt related payables
738,719
601,379
Payable for investments purchased
600,391
11,679,798
Accrued administrative expenses
397,299
384,225
Accrued expenses and other liabilities
1,618,844
1,553,507
Total liabilities
270,537,793
222,324,301
Net assets
Common stock, par value $.001 per share,
200,000,000 common shares authorized, 84,481,797 and 84,478,251
issued and 72,571,907 and 73,876,987 outstanding
84,482
84,478
Paid-in capital in excess of par
850,199,351
852,360,178
Distributable earnings (losses)
(458,387,778)
(434,303,297)
Treasury stock at cost, 11,909,890 and
10,601,264 shares held
(73,373,702)
(68,489,386)
Total net assets
318,522,353
349,651,973
Total liabilities and net assets
$589,060,146
$571,976,274
Net assets per share
$4.39
$4.73
BlackRock Capital Investment Corporation
Consolidated Statements of Operations
Three Months Ended
(Unaudited)
Year Ended
December 31, 2022
December 31, 2021
December 31, 2022
December 31, 2021
Investment income
Interest income (excluding PIK):
Non-controlled, non-affiliated
investments
$16,400,756
$11,858,713
$54,387,478
$40,366,030
Non-controlled, affiliated investments
—
—
—
11,867
Controlled investments
—
—
—
718,571
PIK interest income:
Non-controlled, non-affiliated
investments
512,299
59,418
1,138,311
2,092,736
Non-controlled, affiliated investments
109,309
121,265
456,686
481,800
Dividend income (excluding PIK):
Non-controlled, affiliated investments
—
—
—
71,500
Controlled investments
—
116,648
—
1,647,661
PIK dividend income:
Non-controlled, non-affiliated
investments
83,725
15,177
319,524
15,177
Other income:
Non-controlled, non-affiliated
investments
353,070
429,090
1,633,795
839,678
Total investment income
17,459,159
12,600,311
57,935,794
46,245,020
Operating expenses
Interest and other debt expenses
4,213,025
2,925,218
13,140,402
11,620,899
Management fees
2,186,540
2,122,519
8,311,686
7,784,188
Incentive fees on income
1,712,604
170,002
3,422,362
249,385
Incentive fees on capital gains(1)
—
252,617
(1,544,569)
1,544,569
Administrative expenses
397,299
384,225
1,407,775
1,354,283
Professional fees
112,420
131,039
836,788
1,100,008
Insurance expense
164,534
204,198
747,428
809,356
Director fees
158,125
158,125
613,750
622,500
Investment advisor expenses
25,819
87,500
103,276
350,000
Other operating expenses
396,017
230,022
1,525,774
1,011,273
Total expenses, before incentive fee
waiver
9,366,383
6,665,465
28,564,672
26,446,461
Incentive fee waiver
—
—
—
(79,383)
Total expenses, net of incentive fee
waiver
9,366,383
6,665,465
28,564,672
26,367,078
Net investment income(1)
8,092,776
5,934,846
29,371,122
19,877,942
Realized and unrealized gain (loss) on
investments, Interest Rate Swap and foreign currency
Net realized gain (loss):
Non-controlled, non-affiliated
investments
—
—
1,196,573
21,408,577
Non-controlled, affiliated investments
—
—
—
(7,989,591)
Controlled investments
—
(21,980,388)
—
(32,496,018)
Net realized gain (loss)
—
(21,980,388)
1,196,573
(19,077,032)
Net change in unrealized appreciation
(depreciation):
Non-controlled, non-affiliated
investments
(10,151,765)
226,419
(23,845,171)
20,125,055
Non-controlled, affiliated investments
288,182
(86,942)
620,438
6,932,957
Controlled investments
(3,214,001)
22,565,269
(2,523,687)
38,914,666
Interest Rate Swap
(117,641)
—
(1,332,299)
—
Foreign currency translation
—
—
—
(285,360)
Net change in unrealized appreciation
(depreciation)
(13,195,225)
22,704,746
(27,080,719)
65,687,318
Net realized and unrealized gain
(loss)
(13,195,225)
724,358
(25,884,146)
46,610,286
Net increase (decrease) in net assets
resulting from operations
$(5,102,449)
$6,659,204
$3,486,976
$66,488,228
Net investment income per
share—basic(1)
$0.11
$0.08
$0.40
$0.27
Earnings (loss) per share—basic(1)
$(0.07)
$0.09
$0.05
$0.90
Weighted average shares
outstanding—basic
72,611,050
73,950,159
73,314,124
74,153,145
Net investment income per
share—diluted(1)(2)
$0.11
$0.08
$0.40
$0.27
Earnings (loss) per
share—diluted(1)(2)
$(0.07)
$0.09
$0.05
$0.83
Weighted average shares
outstanding—diluted
72,611,050
90,943,896
81,042,705
91,146,882
__________________________________________
- Net investment income and per share amounts displayed above are
net of the accrual (reversal) for incentive fees on capital gains
which is reflected on a hypothetical liquidation basis in
accordance with GAAP for the year ended December 31, 2022, and for
the three months and year ended December 31, 2021. Refer to
Supplemental Information section below for further details and as
adjusted figures that reflect that there were no incentive fees on
capital gains realized and payable to the Advisor during such
periods.
- For the year ended December 31, 2022, the impact of the
hypothetical conversion of the 2022 Convertible Notes was
antidilutive.
Supplemental Information
The Company reports its financial results on a generally
accepted accounting principles (“GAAP”) basis; however, management
believes that evaluating the Company’s ongoing operating results
may be enhanced if investors have additional non-GAAP basis
financial measures. Management reviews non-GAAP financial measures
to assess ongoing operations and, for the reasons described below,
considers them to be effective indicators, for both management and
investors, of the Company’s financial performance over time. The
Company’s management does not advocate that investors consider such
non-GAAP financial measures in isolation from, or as a substitute
for, financial information prepared in accordance with GAAP.
The Company records its liability for incentive fees based on
capital gains (if any) by performing a hypothetical liquidation
basis calculation at the end of each reporting period, as required
by GAAP, which assumes that all unrealized capital appreciation and
depreciation is realized as of the reporting date. It should be
noted that incentive fees based on capital gains (if any) are not
due and payable until the end of the annual measurement period, or
every June 30. The incremental incentive fees disclosed for a given
period are not necessarily indicative of actual full year results.
Changes in the economic environment, financial markets,
geopolitical conditions and other parameters could cause actual
results to differ from estimates and such differences could be
material. There can be no assurance that unrealized capital
appreciation and depreciation will be realized in the future, or
that any accrued capital gains incentive fee will become payable.
Incentive fee amounts on capital gains actually paid by the Company
will specifically exclude consideration of unrealized capital
appreciation, consistent with requirements under the Investment
Advisers Act of 1940 and the Company’s investment management
agreement. For a more detailed description of the Company’s
incentive fees, please refer to the Company's Annual Report on Form
10-K for the fiscal year ended December 31, 2022, on file with the
Securities and Exchange Commission ("SEC").
Computations for the periods below are derived from the
Company's financial statements as follows:
Three Months Ended
Year Ended
December 31, 2022
December 31, 2021
December 31, 2022
December 31, 2021
GAAP Basis:
Net Investment Income
$8,092,776
$5,934,846
$29,371,122
$19,877,942
Net Investment Income per share
0.11
0.08
0.40
0.27
Addback: GAAP incentive fee (reversal)
based on capital gains
—
252,617
(1,544,569)
1,544,569
Addback: GAAP incentive fee based on
Income net of incentive fee waiver (if any)
1,712,604
170,002
3,422,362
170,002
Pre-Incentive Fee1:
Net Investment Income
$9,805,380
$6,357,465
$31,248,915
$21,592,513
Net Investment Income per share
0.14
0.09
0.43
0.29
Less: Incremental incentive fee based on
Income net of incentive fee waiver (if any)
(1,712,604)
(170,002)
(3,422,362)
(170,002)
As Adjusted2:
Net Investment Income
$8,092,776
$6,187,463
$27,826,553
$21,422,511
Net Investment Income per share
0.11
0.08
0.38
0.29
__________________________________________
- Pre-Incentive Fee: Amounts are adjusted to remove the
impact of all accrued (reversed) incentive fees recorded during the
period.
- As Adjusted: Amounts are adjusted to remove the GAAP
accrual (reversal) for incentive fee based on capital gains (if
any) and to include only the incremental incentive fee based on
income. Adjusted amounts reflect the fact that no incentive fee on
capital gains was realized and payable to the Advisor during the
three months and years ended December 31, 2022 and 2021,
respectively. Under the current investment management agreement,
incentive fee based on income is calculated for each calendar
quarter and may be paid on a quarterly basis if certain thresholds
are met.
Forward-looking statements
This press release, and other statements that BlackRock Capital
Investment Corporation may make, may contain forward-looking
statements within the meaning of the Private Securities Litigation
Reform Act, with respect to BlackRock Capital Investment
Corporation’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.
BlackRock Capital Investment Corporation 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 BlackRock Capital Investment Corporation 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 BlackRock Capital
Investment Corporation’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 advisor 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 advisor or its
affiliates; (13) the ability of our investment advisor 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, inflation, credit risk, 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.
BlackRock Capital Investment Corporation’s Annual Report on Form
10-K for the year ended December 31, 2022, filed with the SEC on
March 1, 2023, identifies additional factors that can affect
forward-looking statements.
Available Information
BlackRock Capital Investment Corporation’s filings with the SEC,
press releases, earnings releases and other financial information
are available on its website at www.blackrockbkcc.com. The
information contained on our website is not a part of this press
release.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20230301006013/en/
Investor Contact: Nik Singhal 212.810.5427
Press Contact: Brian Beades 212.810.5596
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