$25 Million Share Repurchase Program
Authorized
Declares Fourth Quarter 2015 Dividend of
$0.36 Per Share
TriplePoint Venture Growth BDC Corp. (NYSE: TPVG) (the “Company”
or "TPVG"), the leading financing provider to venture growth stage
companies backed by a select group of venture capital firms in the
technology, life sciences and other high growth industries, today
announced its financial results for the third quarter of 2015. TPVG
also declared a fourth quarter 2015 dividend of $0.36 per
share.
Third Quarter 2015 Highlights:
- $115.5 million of signed term sheets;
closed $86.0 million of new debt commitments to domestic and
international venture growth stage companies.
- Investment portfolio growth of $53.9
million to $262.1 million in fair value, with 81% of debt
investment funding occurring in September.
- 17.5% weighted average portfolio
yield.
- GAAP net investment income and core net
investment income1 of $4.7 million ($0.28 per share) and $4.9
million ($0.29 per share), respectively.
- $1.2 million unrealized gain on
anticipated early loan prepayment which occurred on October
2nd.
- Net increase in net assets resulting
from operations of $0.34 per share.
- Raised $52.8 million of net proceeds
from first public offering of notes (NYSE: TPVZ).
- Net asset value of $14.52 per share as
of September 30, 2015.
- Declared a third quarter regular
dividend of $0.36 per share, paid on September 16, 2015.
- Subsequent to the end of the third
quarter, the Company’s Board of Directors authorized the repurchase
of up to $25 million of its common stock at prices below TPVG’s net
asset value per share.
“We continue to execute on our strategy of deploying our capital
in a disciplined fashion at attractive risk adjusted returns,” said
Jim Labe, chief executive officer and chairman of the board of
TPVG. “Our fundings during the third quarter were our second
highest since our initial public offering in March 2014, reflecting
the strong demand for debt from venture growth stage
companies.”
“Our performance this quarter reflects our differentiated
venture growth stage lending model,” said Sajal Srivastava,
president and chief investment officer of the Company. “We believe
that the combination of our growing investment portfolio, strong
portfolio yield, stable dividend and recently announced share
repurchase program will help drive increased returns and greater
value for our shareholders.”
Portfolio and Investment Activity
During the third quarter of 2015, the Company entered into $86.0
million of new commitments, funded six debt investments totaling
$53.1 million in principal balance, and acquired warrants valued at
approximately $0.7 million. Of the $53.1 million of debt
investments funded in the third quarter, approximately $43.1
million, or 81%, were funded during the month of September. As a
result, net investment income for the third quarter reflects less
than a full quarter’s benefit of these new fundings. The Company’s
weighted average portfolio yield for the third quarter was 17.5%.
The Company calculates weighted average portfolio yield as the
annualized rate of the interest income recognized during the period
divided by the average amortized cost of debt investments in the
portfolio at the beginning of each month in the period. The Company
had no prepayment activity during the third quarter.
As of September 30, 2015, the Company had 80 investments in 32
companies. The total cost and fair value of these investments were
approximately $260.7 million and $262.1 million, respectively.
The following table shows detailed information about the total
investment portfolio as of September 30, 2015.
As of September 30, 2015 (dollars in
thousands) Cost Fair Value
Net Unrealized (Losses) Gains
Number of Investments Number
of Companies Debt Investments $ 249,916 $ 248,212 $
(1,704 ) 44 18
Warrants 7,347 9,530 2,183 29 29
Equity
Investments 3,474 4,388 914 7 7
Total $ 260,737 $ 262,130
$ 1,393 80 32*
* represents non-duplicative number of companies.
Unfunded Commitments
As of September 30, 2015, the Company’s unfunded commitments
totaled approximately $170.4 million, $22.0 million of which are
dependent upon customers reaching certain milestones before being
permitted to request funding. Of the $170.4 million of unfunded
commitments, $20.0 million will expire during 2015 if not drawn
prior to expiration. Since unfunded commitments may expire without
being drawn upon, they do not necessarily represent future cash
requirements or future earning assets for the Company.
Signed Term Sheets
During the third quarter, TriplePoint Capital (“TPC”) originated
$115.5 million of signed, non-binding term sheets to venture growth
stage companies. All of these opportunities are subject to a number
of conditions including completion of due diligence, negotiation of
definitive documentation and investment committee approval, as well
as compliance with TPC’s allocation policy. Accordingly, there is
no assurance that any or all of these transactions will be
completed or assigned to the Company even though the Company is the
primary vehicle through which TPC focuses its venture growth stage
business.
Results of Operations
For the third quarter of 2015, the Company’s total investment
and other income was $9.2 million as compared to $7.9 million for
the third quarter of 2014, representing a weighted average
portfolio yield of 17.5% on its debt investments during the third
quarter of 2015 as compared to 14.5% for the third quarter of 2014.
For the nine months ended September 30, 2015, the Company’s total
investment and other income was $30.7 million, representing a
weighted average portfolio yield of 16.7% on its debt
investments.
Operating expenses for the third quarter of 2015 were
approximately $4.6 million as compared to $4.3 million for the
third quarter of 2014. Operating expenses for the third quarter of
2015 consisted of $1.5 million of base management fees, $0.2
million of income incentive fees, $0.2 million of accrued capital
gains incentive fees, $1.7 million of interest expense and
amortization of deferred credit facility costs, $0.4 million of
administration agreement expenses and $0.6 million of general and
administrative expenses. For the nine months ended September 30,
2015, the Company’s operating expenses were $14.7 million.
For the third quarter of 2015, the Company recorded net
investment income of approximately $4.7 million, or $0.28 per
share, as compared to approximately $3.5 million, or $0.36 per
share for the third quarter of 2014. The Company’s core net
investment income, which excludes the impact of the capital gains
incentive fee, was approximately $4.9 million, or $0.29 per share,
for the third quarter as compared to approximately $3.8 million, or
$0.38 per share, for the third quarter of 2014. For the nine months
ended September 30, 2015, the Company’s net investment income was
$15.9 million, or $1.10 per share, and core net investment income
was $15.8 million, or $1.09 per share. The Company believes an
important measure of the investment income that the Company
distributes each year is core net investment income since capital
gains incentive fees are accrued based on net realized and
unrealized gains but are not earned until net realized gains
occur.
For the third quarter of 2015, the Company’s net change in
unrealized gains was approximately $1.0 million, or $0.06 per
share, as compared to an unrealized gain of approximately $1.2
million for the third quarter of 2014. The net change in unrealized
gains in the third quarter of 2015 consisted of approximately $1.2
million for the increase in fair value of debt investments relating
primarily to the expected prepayment of loans from one customer,
approximately $47 thousand for the increase in fair value of
warrants and approximately $0.2 million unrealized loss for the
decrease in fair value of equity held in a publicly traded company.
For the nine months ended September 30, 2015, the Company’s net
change in unrealized losses was approximately $0.1 million, or
$0.01 per share.
The Company’s net increase in net assets resulting from
operations for the third quarter of 2015 was approximately $5.7
million, or $0.34 per share, as compared to $4.7 million, or $0.47
per share, for the third quarter of 2014. For the nine months ended
September 30, 2015, the Company’s net increase in net assets
resulting from operations was approximately $15.5 million, or $1.07
per share.
As of September 30, 2015, the Company had $2.4 million, or $0.14
per share, of undistributed taxable income from ordinary
income.
Credit Quality
The Company maintains a credit watch list, which places
borrowers into one of five categories based on management’s
judgment of credit quality, where Clear, or 1, is the highest
rating and new loans are generally assigned a ranking of White, or
2. As of September 30, 2015, the weighted average credit ranking of
the Company’s debt investment portfolio was 2.10, as compared to
2.01 at the end of the prior quarter. The change primarily reflects
the downgrade of $20.9 million in principal balance of loans to
Virtual Instruments Corporation from category ‘2’ to category
‘3’.
The following table shows the credit rankings for the 18 debt
investments the Company has outstanding, as of September 30,
2015.
As of September 30, 2015 (dollars in
thousands)
Category
Fair Value Percentage of Debt
Investment Portfolio Number of
Portfolio Companies Clear (1) $ 29,936 12.1
%
1
White (2) 173,624 69.9 14
Yellow (3) 33,666
13.6 2
Orange (4) 10,986 4.4 1
Red (5) —
— — $ 248,212 100.0
%
18
Net Asset Value
As of September 30, 2015, the Company’s net assets were
approximately $242.1 million, compared to approximately $242.0
million as of June 30, 2015. The Company’s net asset value per
share as of September 30, 2015 was $14.52 per share, compared to
$14.54 per share as of June 30, 2015. These per share calculations
are based on the Company’s shares of common stock outstanding as of
the end of the respective periods.
Liquidity and Capital Resources
As of September 30, 2015, the Company had total cash of
approximately $50.4 million and available capacity of $186.0
million under its revolving credit facility.
Dividend
The Company’s board of directors declared a quarterly dividend
of $0.36 per share for the fourth quarter of 2015 payable on
December 16, 2015, to stockholders of record as of November 30,
2015.
Subsequent Events
Since September 30, 2015:
- TPC’s direct originations platform
entered into $27.0 million of additional non-binding signed term
sheets with venture growth stage companies.
- The Company received prepayments from
two customers totaling $16.5 million of outstanding principal
balance.
- The Company provided $5.0 million of
additional growth capital loans to Virtual Instruments
Corporation.
$25 Million Share Repurchase Program
Subsequent to the end of the third quarter, the Company’s Board
of Directors authorized the repurchase of up to $25 million of its
common stock at prices below the Company’s net asset value per
share as reported in its most recent financial statements. Under
the repurchase program, the Company may, but is not obligated to,
repurchase shares of its outstanding common stock in the open
market or in privately negotiated transactions from time to time.
Any repurchases by the Company will comply with the requirements of
Rule 10b-18 under the Securities Exchange Act of 1934, as amended,
and any applicable requirements of the Investment Company Act of
1940, as amended. The timing, manner, price and amount of any share
repurchases will be determined by the Company, in its discretion,
based upon the evaluation of economic and market conditions, stock
price, applicable legal and regulatory requirements and other
factors. The Company expects that the program will be in effect
until October 31, 2016, or until the approved dollar amount has
been used to repurchase shares. The program does not require the
Company to repurchase any specific number of shares and the Company
cannot assure you that any shares will be repurchased under the
program. The program may be suspended, extended, modified or
discontinued at any time.
Conference Call
The Company will host a conference call at 5:00 p.m. Eastern
time today, November 10, 2015, to discuss its financial results for
the quarter ending September 30, 2015. To listen to the call,
investors and analysts should dial 877-201-0168 (domestic) or
647-788-4901 (international) and enter conference ID 97009606.
Please dial in at least five minutes before the scheduled start
time. A replay of the call will be available through November [24],
2015, by dialing 855-859-2056 (domestic) or 404-537-3406
(international) and entering conference ID 97009606. The conference
call also will be available via a live audio webcast in the
investor relations section of the Company’s website,
http://www.tpvg.com. An online archive of the webcast will be
available on the Company’s website for 30 days after the call.
About TriplePoint Venture Growth BDC Corp.
TriplePoint Venture Growth BDC Corp. (the “Company”) (NYSE:
TPVG) is an externally managed, closed-end, non-diversified
management investment company that has elected to be regulated as a
business development company under the Investment Company Act of
1940, as amended. It was formed to expand the venture growth stage
business segment of TriplePoint Capital LLC. The Company’s
investment objective is to maximize its total return to
stockholders primarily in the form of current income and, to a
lesser extent, capital appreciation by primarily lending with
warrants to venture growth stage companies focused in technology,
life sciences and other high growth industries backed by a select
group of leading venture capital investors. More information is
available at http://www.tpvg.com.
Forward-Looking Statements
Certain statements contained in this press release constitute
forward-looking statements as such term is defined in Section 27A
of the Securities Act of 1933, as amended, and Section 21E of the
Securities Exchange Act of 1934, as amended, and such statements
are intended to be covered by the safe harbor provided by the same.
Forward-looking statements are subject to substantial risks and
uncertainties, many of which are difficult to predict and are
generally beyond the Company's control. Words such as
"anticipates," "expects," "intends," "plans," "will," "may,"
"continue," "believes," "seeks," "estimates," "would," "could,"
"should," "targets," "projects," and variations of these words and
similar expressions are intended to identify forward-looking
statements. For a further list and description of such risks and
uncertainties, see the Company's final prospectus filed with the
Securities and Exchange Commission on March 30, 2015, annual report
on Form 10-K for the year ended December 31, 2014 filed with the
Securities and Exchange Commission on March 18, 2015, and other
reports filed by the Company with the Securities and Exchange
Commission. The forward-looking statements, and other risks,
uncertainties and factors are based on the Company's beliefs,
assumptions and expectations of its future performance, taking into
account all information currently available to the Company.
Forward-looking statements are not predictions of future events.
The Company disclaims any intention or obligation to update or
revise any forward-looking statements, whether as a result of new
information, future events or otherwise, except as required by
law.
TRIPLEPOINT VENTURE GROWTH BDC
CORP
CONSOLIDATED STATEMENTS OF ASSETS AND
LIABILITIES
(dollars in thousands, except share
data)
September 30, 2015 December 31, 2014
(unaudited) Assets Investments at fair value
(amortized cost of $260,737 and $256,485, respectively) $ 262,130 $
257,971 Short-term investments at fair value (cost of $59,996 and
$49,998, respectively) 59,994 49,995 Cash 46,889 6,906 Restricted
cash 3,489 8,033 Deferred credit facility costs and prepaid
expenses 2,495 3,424
Total Assets
374,997 326,329
Liabilities Revolving credit
facility payable 14,000 118,000 2020 Notes, net 52,819 — Payable
for U.S. Treasury bill assets 59,996 49,998 Other payables, accrued
expenses, and liabilities 6,057 13,352
Total
Liabilities 132,872 181,350
Net
Assets $ 242,125 $ 144,979 Preferred stock, par value
$0.01 per share (50,000,000 shares authorized; no shares issued and
outstanding as of September 30, 2015 and December 31, 2014) $ — $ —
Common stock, par value $0.01 per share (450,000,000 shares
authorized; 16,680,177 and 9,924,171 shares issued and outstanding
as of September 30, 2015 and December 31, 2014, respectively) 167
99 Paid-in capital in excess of par value 239,754 142,635 Net
investment income 28,719 12,808 Accumulated net realized losses
(317 ) — Accumulated net unrealized gains 1,391 1,483 Dividend
distributions (27,589 ) (12,046 )
Net Assets $
242,125 $ 144,979
Net Asset Value per Share $ 14.52 $
14.61
TRIPLEPOINT VENTURE GROWTH BDC
CORP
CONSOLIDATED STATEMENTS OF
OPERATIONS
(dollars in thousands, except share
data)
For the Three Months Ended September
30,
For the Nine Months Ended
For the Period from
March 5, 2014
(Commencement of Operations) to
September 30, 2014
2015
2014
September 30, 2015 Investment Income Interest
income from investments $ 9,184 $ 7,802 $ 28,832 $ 14,504 Other
income 61 56 1,827 152
Total
investment and other income 9,245 7,858 30,659 14,656
Operating Expenses Base management fee 1,490 850 4,053 1,668
Income incentive fee 170 938 2,907 1,157 Capital gains incentive
fee 209 230 (81 ) 512 Interest expense and amortization of fees
1,656 1,370 4,494 2,300 Administration agreement expenses 417 344
1,194 737 General and administrative expenses 632 604
2,181 1,336
Total Operating Expenses
4,574 4,336 14,748 7,710 Net investment
income 4,671 3,522 15,911 6,946 Net realized losses - - (317 ) -
Net change in unrealized gains (losses) on investments 1,044
1,151 (92 ) 2,561
Net Increase in
Net Assets Resulting from Operations $ 5,715 $ 4,673 $ 15,502 $
9,507 Basic and diluted net investment income per share $
0.28 $ 0.36 $ 1.10 $ 0.70 Basic and diluted net increase in net
assets per share $ 0.34 $ 0.47 $ 1.07 $ 0.96 Basic and diluted
weighted average shares of common stock outstanding 16,648,379
9,872,564 14,524,330 9,858,725
TRIPLEPOINT VENTURE GROWTH BDC
CORP
FINANCIAL HIGHLIGHTS
For the Three Months Ended September 30,
For the Nine Months
Ended
September 30, 2015
For the Period from
March 5, 2014
(Commencement of Operations)
to September 30, 2014
2015 2014
Weighted average portfolio yield (1) 17.5 % 14.5 %
16.7 % 14.4 % Coupon income (1) 10.7 % 10.9 % 10.8 % 11.0 % Net
amortization and accretion of premiums and discounts (1) 0.8 % 0.4
% 0.7 % 0.3 % Net accretion of end-of-term payments (1) 6.0 % 3.2 %
3.9 % 3.1 % Impact of prepayments (1) — — 1.3 % — Net
investment income to average net asset value (2) 7.7 % 9.7 % 10.1 %
8.4 % Net increase in net assets to average net asset value (2) 9.4
% 12.9 % 9.8 % 11.5 % Total operating expenses to average
net asset value (2) 7.5 % 12.0 % 9.3 % 9.3 % Operating expenses
excluding incentive fees to average net asset value (2) 6.9 % 8.8 %
7.6 % 7.3 % Income component of incentive fees to average net asset
value (2) 0.3 % 2.6 % 1.8 % 1.4 % Capital gains component of
incentive fees to average net asset value (2) 0.3 % 0.6 % (0.1 )%
0.6 %
(1) Weighted average portfolio yields for periods shown are the
annualized rate of the interest income recognized during the period
divided by the average amortized cost of debt investments in the
portfolio at the beginning of each month in the period.
(2) Percentage is presented on an annualized basis.
The following table provides a reconciliation of net investment
income to core net investment income for the three and nine months
ended September 30, 2015, for the three months ended September 30,
2014, and for the period from March 5, 2014 (commencement of
operations) to September 30, 2014.
TRIPLEPOINT VENTURE GROWTH BDC
CORP
RECONCILIATION OF CORE NET INVESTMENT
INCOME
(dollars in thousands, except share
data)
Net Investment Income and Core Net Investment Income
For the Three Months Ended September 30,
For the Nine Months Ended
September 30, 2015
For the Period from
March 5, 2014
(Commencement of Operations) to
September 30, 2014
(dollars in thousands, except per share amounts) 2015
2014 Net Investment Income $
4,671 $ 3,522 $ 15,911 $ 6,946 Capital gains incentive fee
209 230 (81 ) 512
Core Net Investment
Income $ 4,880 $ 3,752 $ 15,830 $ 7,458
Net
Investment Income per Share $ 0.28 $ 0.36 $ 1.10 $ 0.70 Capital
gains incentive fee per share 0.01 0.02 (0.01
) 0.06
Core Net Investment Income per Share $ 0.29 $
0.38 $ 1.09 $ 0.76
For the three and nine months ended September 30, 2015, the
Company recorded accrued capital gains incentive fee of
approximately $0.2 million and a reversal of $0.1 million,
respectively. For the three months ended September 30, 2014, the
Company recorded accrued capital gains incentive fee of
approximately $0.2 million and $0.5 million for the period from
March 5, 2014 (commencement of operations) to September 30, 2014.
The capital gains incentive fee accrual, as reported under
generally accepted accounting principles, is calculated on the
basis of net realized and unrealized gains and losses at the end of
each period. The accrued capital gains incentive fee related to the
hypothetical liquidation of the portfolio (and assuming no other
changes in realized or unrealized gains and losses) would only have
become payable to its investment adviser in the event of a complete
liquidation of its portfolio as of period end and the termination
of the Investment Advisory Agreement (“Agreement”).
The amount of the capital gains incentive fee, if any, which
will actually be payable is determined in accordance with the terms
of the Agreement and is calculated as of the end of each calendar
year (or upon termination of the Agreement). The terms of the
Agreement state that the capital gains incentive fee calculation is
based on net realized gains, if any, offset by gross unrealized
depreciation for the calendar year. No effect is given to gross
unrealized appreciation in this calculation.
1 Core net investment income is a non-GAAP measure and is
provided in addition to, but not as a substitute for, net
investment income. Core net investment income represents net
investment income excluding the Company’s capital gains incentive
fee.
View source
version on businesswire.com: http://www.businesswire.com/news/home/20151110006907/en/
Abernathy MacGregorAlan Oshiki,
212-371-5999aho@abmac.comorTrevor Martin,
415-926-7961trm@abmac.com
Triplepoint Venture Growth Bdc Corp. 6.75% Notes Due 2020 (delisted) (NYSE:TPVZ)
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