PIK
Potsdam, Germany
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Potsdam, Germany

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GREENWICH, CT, Feb. 09, 2017 (GLOBE NEWSWIRE) -- Fifth Street Senior Floating Rate Corp. (NASDAQ:FSFR) ("FSFR" or "we") today announced its financial results for the first fiscal quarter ended December 31, 2016. “As FSFR moves into its next chapter, we will continue to leverage Fifth Street’s direct origination platform to invest in floating rate, senior secured loans with lower loss given default characteristics and in companies with sustainable free cash flow,” stated Patrick J. Dalton, FSFR's Chief Executive Officer. “We believe that FSFR remains well-positioned to take advantage of opportunities in the senior secured loan market and we plan to reposition the portfolio in a way that increases operating flexibility and drives long-term stockholder value.  Additionally, the management team and Board of Directors determined it was prudent to calibrate FSFR’s dividend level with the goal of meeting or exceeding it with net investment income on a quarterly basis, to preserve NAV, enhance our balance sheet and create value for our stockholders.” FSFR's Board of Directors determined the fair value of our investment portfolio at December 31, 2016 to be $540.1 million, as compared to $573.6 million at September 30, 2016.  Total assets were $590.2 million at December 31, 2016, as compared to $622.4 million at September 30, 2016. During the quarter ended December 31, 2016, we closed $41.3 million of investments in six new and two existing portfolio companies and funded $37.6 million across new and existing portfolio companies.  This compares to closing $128.5 million of investments in 23 new and two existing portfolio companies, and funding $132.4 million across new and existing portfolio companies during the quarter ended December 31, 2015. During the quarter ended December 31, 2016, we received $58.3 million in connection with the repayments and exits of eight of our investments, all of which were exited at or above par, and an additional $8.4 million in connection with other paydowns and sales of investments. At December 31, 2016, our portfolio consisted of investments in 61 companies.  At fair value, 87.3% of our portfolio consisted of senior secured floating rate debt investments, 11.4% consisted of investments in the subordinated notes and LLC equity interests of FSFR Glick JV LLC ("FSFR Glick JV") and 1.2% consisted of equity investments in other portfolio companies.  Our average portfolio company debt investment size at fair value was $8.7 million at December 31, 2016 versus $8.9 million at September 30, 2016.  The average portfolio company EBITDA was $66.9 million at December 31, 2016. At December 31, 2016, FSFR Glick JV had $170.0 million in assets, including senior secured loans to 32 portfolio companies.  The joint venture generated income of $1.6 million for FSFR during the first fiscal quarter, which represented an 8.9% weighted average annualized return on investment. Our weighted average yield on debt investments at December 31, 2016, including the return on FSFR Glick JV, was 8.5%, and included a cash component of 8.2%.  We utilized our attractively priced leverage and operated within our target leverage range of 0.8x to 0.9x debt-to-equity during the quarter, ending the quarter at 0.79x leverage. Total investment income for the quarters ended December 31, 2016 and December 31, 2015 was $11.6 million and $13.9 million, respectively. For the quarter ended December 31, 2016, the amount primarily consisted of $11.0 million of interest income from portfolio investments. For the quarter ended December 31, 2015, this amount primarily consisted of $12.2 million of interest income from portfolio investments. Net expenses for the quarters ended December 31, 2016 and December 31, 2015 were $5.7 million and $6.9 million, respectively.  Total expenses decreased for the quarter ended December 31, 2016 as compared to the quarter ended December 31, 2015, due primarily to a $0.8 million decrease in Part I incentive fees payable to our investment adviser and a $0.5 million decrease in professional fees, partially offset by a $0.3 million increase in general and administrative expenses and a $0.2 million increase in interest expense. Net realized and unrealized losses on our investment portfolio for the quarters ended December 31, 2016 and December 31, 2015 were $5.2 million and $20.3 million, respectively. At December 31, 2016, we had $43.7 million of cash and cash equivalents (including $7.5 million of restricted cash), portfolio investments (at fair value) of $540.1 million, $3.8 million of interest, dividends and fees receivable, $14.5 million of payables from unsettled transactions, $72.3 million of borrowings outstanding under our revolving credit facilities, $177.6 million of borrowings outstanding under our debt securitization (net of unamortized financing costs) and unfunded commitments of $49.7 million.  Our regulatory leverage ratio was 0.79x debt-to-equity. At September 30, 2016, we had $28.8 million of cash and cash equivalents (including $9.0 million of restricted cash), portfolio investments (at fair value) of $573.6 million, $4.6 million of interest, dividends and fees receivable, $12.9 million of receivables from unsettled transactions, $107.4 million of borrowings outstanding under our revolving credit facilities, $177.5 million of borrowings outstanding under our debt securitization (net of unamortized financing costs) and unfunded commitments of $52.8 million.  Our regulatory leverage ratio was 0.90x debt-to-equity. In addition to our previously declared monthly dividend of $0.075 per share, which is payable on February 28, 2017 to stockholders of record on February 15, 2017, our Board of Directors met on February 6, 2017 and declared the following distributions: Dividends are paid primarily from distributable (taxable) income. To the extent our taxable earnings for a fiscal taxable year fall below the total amount of our dividend distributions for that fiscal year, a portion of those distributions may be deemed a return of capital to our stockholders. Our Board of Directors determines dividends based on estimates of distributable (taxable) income, which differ from book income due to temporary and permanent differences in income and expense recognition and changes in unrealized appreciation and depreciation on investments. We utilize the following investment ranking system to assess and monitor our debt investment portfolio: At December 31, 2016 and September 30, 2016, the distribution of our debt investments on the 1 to 4 investment ranking scale at fair value was as follows: (1) Due to operating performance this ratio is not measurable and, as a result, is excluded from the total portfolio calculation. (2) Beginning as of December 31, 2016, we have revised our investment ranking scale to include only debt investments. Accordingly, in order to make the table comparative, we revised the investment ranking table as of September 30, 2016 to exclude equity investments. We may from time to time modify the payment terms of our investments, either in response to current economic conditions and their impact on certain of our portfolio companies or in accordance with tier pricing provisions in certain loan agreements.  As of December 31, 2016, we had modified the payment terms of our investments in five portfolio companies.  Such modified terms may include increased PIK interest rates and reduced cash interest rates.  These modifications, and any future modifications to our loan agreements, may limit the amount of interest income that we recognize from the modified investments, which may, in turn, limit our ability to make distributions to our stockholders. As of December 31, 2016, there were two investments on which we had stopped accruing cash and/or PIK interest or OID income that represented 2.9% of our debt portfolio at fair value in the aggregate. On December 8, 2016, our Board of Directors appointed Patrick J. Dalton as Chief Executive Officer and elected him as a member of the Board of Directors, effective January 2, 2017, succeeding Ivelin M. Dimitrov. In addition, Todd G. Owens also stepped down from his role as President and a member of the Board of Directors, effective January 2, 2017. We will make available an audio recording discussing our financial results at 10:00 a.m. (Eastern Time) on Friday, February 10, 2017. Domestic callers can access the audio recording by dialing (877) 359-2861. International callers can access the audio recording by dialing +1 (540) 318-1180. All callers will need to enter the Conference ID Number 55871239 and reference "Fifth Street Senior Floating Rate Corp." after being connected with the operator. All callers are asked to dial in 10-15 minutes prior to the call so that name and company information can be collected.  An archived replay of the call will be available approximately four hours after the end of the call and will be available through February 17, 2017 to domestic callers by dialing (855) 859-2056 and to international callers by dialing +1 (404) 537-3406. For all replays, please reference Conference ID Number 55871239. An archived replay will also be available online on the "Investor Relations" section of our website under the "News & Events - Calendar of Events" section. FSFR's website can be accessed at fsfr.fifthstreetfinance.com. Fifth Street Senior Floating Rate Corp. is a specialty finance company that provides financing solutions in the form of floating rate senior secured loans to mid-sized companies, primarily in connection with investments by private equity sponsors.  FSFR's investment objective is to maximize its portfolio's total return by generating current income from its debt investments while seeking to preserve its capital.  FSFR has elected to be regulated as a business development company and is externally managed by a subsidiary of Fifth Street Asset Management Inc. (NASDAQ:FSAM), a nationally recognized credit-focused asset manager with approximately $5 billion in assets under management across multiple public and private vehicles. With a track record of over 18 years, the Fifth Street platform received the 2015 ACG New York Champion's Award for "Lender Firm of the Year," and other previously received accolades include the ACG New York Champion's Award for "Senior Lender Firm of the Year," "Lender Firm of the Year" by The M&A Advisor and "Lender of the Year" by Mergers & Acquisitions.  FSC's website can be found at fsc.fifthstreetfinance.com. 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. Forward-looking statements may include statements as to the future operating results, dividends and business prospects of FSFR. Words such as "believes," "expects," "seeks," "plans," "should," "estimates," "project," and "intend" indicate forward-looking statements, although not all forward-looking statements include these words. These forward-looking statements involve risks and uncertainties. Actual results could differ materially from those implied or expressed in these forward-looking statements for any reason. Such factors are identified from time to time in FSFR's filings with the Securities and Exchange Commission and include changes in the economy and the financial markets and future changes in laws or regulations and conditions in FSFR's operating areas. FSFR undertakes no 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.


News Article | February 9, 2017
Site: globenewswire.com

GREENWICH, CT, Feb. 09, 2017 (GLOBE NEWSWIRE) -- Fifth Street Finance Corp. (NASDAQ:FSC) ("FSC" or "we") today announced its financial results for the first fiscal quarter ended December 31, 2016. “Since assuming the role of CEO in January, the FSC team and I have worked diligently to create a comprehensive strategic plan centered on improving performance and creating long-term value for our stockholders,” stated Patrick J. Dalton, FSC's Chief Executive Officer.  “Looking ahead, we are focused on enhancing operating and investment performance, generating NAV stability, optimizing our borrowing facilities and reducing leverage to within our targeted range.  To that end, we plan on repositioning our portfolio, increasing alignment through further changes to our fee structure, realigning our dividend policy and recruiting key personnel to strengthen our infrastructure.” FSC's Board of Directors determined the fair value of our investment portfolio at December 31, 2016 to be $2.0 billion, as compared to $2.2 billion at September 30, 2016.  Total assets were $2.2 billion at December 31, 2016, as compared to $2.3 billion at September 30, 2016. During the quarter ended December 31, 2016, we closed $118.3 million of investments in five new and three existing portfolio companies and funded $104.2 million across new and existing portfolio companies.  This compares to closing $338.3 million of investments in six new and five existing portfolio companies, and funding $351.9 million during the quarter ended December 31, 2015.  During the quarter ended December 31, 2016, we received $187.7 million in connection with the repayments and exits of 10 of our non-control investments, all of which were exited at or above par, and an additional $37.8 million in connection with other paydowns and sales of investments. At December 31, 2016, our portfolio consisted of investments in 123 companies, 104 of which were completed in connection with investments by private equity sponsors.  Our portfolio also included our investment in Senior Loan Fund JV I, LLC ("SLF JV I") and 18 investments in private equity funds.  At fair value, 90.7% of our portfolio consisted of debt investments and 77.6% of our portfolio consisted of senior secured loans.  Our average portfolio company debt investment size at fair value was $19.0 million at December 31, 2016, versus $19.7 million at September 30, 2016. At December 31, 2016, SLF JV I had $318.8 million in assets, including senior secured loans to 34 portfolio companies.  The joint venture generated income of $3.8 million for FSC during the first fiscal quarter, which represented an 8.8% weighted average annualized return on investment. Our weighted average yield on debt investments at December 31, 2016, including the return on SLF JV I, was 10.3% and included a cash component of 9.1%.  At December 31, 2016 and September 30, 2016, $1.4 billion and $1.6 billion, respectively, of our debt investments at fair value bore interest at floating rates, which represented 81.0% and 80.9%, respectively, of our total portfolio of debt investments at fair value. Total investment income for the quarters ended December 31, 2016 and December 31, 2015 was $51.8 million and $65.1 million, respectively.  For the quarter ended December 31, 2016, the amount primarily consisted of $43.9 million of cash interest income from portfolio investments.  For the quarter ended December 31, 2015, the amount primarily consisted of $51.2 million of cash interest income from portfolio investments.  For the quarter ended December 31, 2016, payment-in-kind ("PIK") interest income received in cash was in excess of PIK income accrued. Net expenses for the quarters ended December 31, 2016 and December 31, 2015 were $28.5 million and $38.5 million, respectively.  Net expenses decreased for the quarter ended December 31, 2016 as compared to the quarter ended December 31, 2015, due primarily to a $6.5 million decrease in professional fees (net of insurance recoveries) and a $3.1 million decrease in base management fees (net of waivers), which was attributable to a reduction in the size of our investment portfolio, as well as the permanent fee reduction that we agreed to with our investment adviser effective January 1, 2016. Net realized and unrealized losses on our investment portfolio for the quarters ended December 31, 2016 and December 31, 2015 were $97.5 million and $89.5 million, respectively. At December 31, 2016, we had $181.0 million of cash and cash equivalents (including $1.1 million of restricted cash), portfolio investments (at fair value) of $2.0 billion, $12.3 million of interest, dividends and fees receivable, $19.5 million of payables from unsettled transactions, $210.2 million of U.S. Small Business Administration ("SBA") debentures payable (net of unamortized financing costs), $441.4 million of borrowings outstanding under our credit facilities, $405.0 million of unsecured notes payable (net of unamortized financing costs), $14.0 million of secured borrowings and unfunded commitments of $157.0 million.  Our regulatory leverage ratio was 0.84x debt-to-equity, excluding the debentures issued by our small business investment company ("SBIC") subsidiaries. At September 30, 2016, we had $130.4 million of cash and cash equivalents (including $12.4 million of restricted cash), portfolio investments (at fair value) of $2.2 billion, $15.6 million of interest, dividends and fees receivable, $210.0 million of SBA debentures payable (net of unamortized financing costs), $516.3 million of borrowings outstanding under our credit facilities, $404.6 million of unsecured notes payable (net of unamortized financing costs), $18.4 million of secured borrowings and unfunded commitments of $215.7 million.  Our regulatory leverage ratio was 0.83x debt-to-equity, excluding the debentures issued by our SBIC subsidiaries. In addition to our previously declared monthly dividend of $0.06 per share, which is payable on February 28, 2017 to stockholders of record on February 15, 2017, our Board of Directors met on February 6, 2017 and declared the following distributions: Dividends are paid primarily from distributable (taxable) income. To the extent our taxable earnings for a fiscal taxable year fall below the total amount of our dividend distributions for that fiscal year, a portion of those distributions may be deemed a return of capital to our stockholders. Our Board of Directors determines dividends based on estimates of distributable (taxable) income, which differ from book income due to temporary and permanent differences in income and expense recognition and changes in unrealized appreciation and depreciation on investments. On November 28, 2016, our Board of Directors approved a common stock repurchase program authorizing us to repurchase up to $12.5 million of the outstanding shares of our common stock through November 28, 2017.  During the quarter ended December 31, 2016, we repurchased 2.3 million shares of common stock in the open market at an aggregate cost of $12.5 million, bringing the total amount repurchased during calendar year 2016 to $50.0 million. We utilize the following investment ranking system to assess and monitor our debt investment portfolio: At December 31, 2016 and September 30, 2016, the distribution of our debt investments on the 1 to 4 investment ranking scale at fair value was as follows (dollars in thousands): _____________ (1) Due to operating performance this ratio is not measurable and, as a result, is excluded from the total portfolio calculation. (2) Beginning as of December 31, 2016, we have revised our investment ranking scale to include only debt investments. Accordingly, in order to make the table comparative, we revised the investment ranking table as of September 30, 2016 to exclude equity investments. We may from time to time modify the payment terms of our debt investments, either in response to current economic conditions and their impact on certain of our portfolio companies or in accordance with tier pricing provisions in certain loan agreements.  As of December 31, 2016, we had modified the payment terms of our debt investments in 14 portfolio companies.  Such modified terms may include increased PIK interest rates and reduced cash interest rates.  These modifications, and any future modifications to our loan agreements, may limit the amount of interest income that we recognize from the modified investments, which may, in turn, limit our ability to make distributions to our stockholders. As of December 31, 2016, there were 11 investments on which we had stopped accruing cash and/or PIK interest or original issue discount ("OID") income that represented 7.3% of our debt portfolio at fair value in the aggregate. On December 8, 2016, our Board of Directors appointed Patrick J. Dalton as Chief Executive Officer and elected him as a member of the Board of Directors, effective January 2, 2017, succeeding Todd G. Owens. In addition, Ivelin M. Dimitrov also stepped down from his roles as President, Chief Investment Officer and a member of the Board of Directors, effective January 2, 2017. We will make available an audio recording discussing our financial results at 10:00 a.m. (Eastern Time) on Thursday, February 9, 2017. Domestic callers can access the audio recording by dialing (877) 290-1655. International callers can access the audio recording by dialing +1 (531) 289-2889. All callers will need to enter the Conference ID Number 55866319 and reference "Fifth Street Finance Corp." after being connected with the operator. All callers are asked to dial in 10-15 minutes prior to the call so that name and company information can be collected.  An archived replay of the call will be available approximately four hours after the end of the call and will be available through February 16, 2017 to domestic callers by dialing (855) 859-2056 and to international callers by dialing +1 (404) 537-3406. For all replays, please reference Conference ID Number 55866319. An archived replay will also be available online on the "Investor Relations" section of our website under the "News & Events - Calendar of Events" section. FSC's website can be accessed at fsc.fifthstreetfinance.com. Fifth Street Finance Corp. is a leading specialty finance company that provides custom-tailored financing solutions to small and mid-sized companies, primarily in connection with investments by private equity sponsors.  FSC originates and invests in one-stop financings, first lien, second lien, mezzanine debt and equity co-investments.  FSC's investment objective is to maximize its portfolio's total return by generating current income from its debt investments and capital appreciation from its equity investments. FSC has elected to be regulated as a business development company and is externally managed by a subsidiary of Fifth Street Asset Management Inc. (NASDAQ:FSAM), a nationally recognized credit-focused asset manager with approximately $5 billion in assets under management across multiple public and private vehicles. With a track record of over 18 years, the Fifth Street platform received the 2015 ACG New York Champion's Award for "Lender Firm of the Year," and other previously received accolades include the ACG New York Champion's Award for "Senior Lender Firm of the Year," "Lender Firm of the Year" by The M&A Advisor and "Lender of the Year" by Mergers & Acquisitions.  FSC's website can be accessed at fsc.fifthstreetfinance.com. 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. Forward-looking statements may include statements as to the future operating results, dividends and business prospects of FSC. Words such as "believes," "expects," "seeks," "plans," "should," "estimates," "project," and "intend" indicate forward-looking statements, although not all forward-looking statements include these words. These forward-looking statements involve risks and uncertainties. Actual results could differ materially from those implied or expressed in these forward-looking statements for any reason. Such factors are identified from time to time in FSC's filings with the Securities and Exchange Commission and include changes in the economy and the financial markets and future changes in laws or regulations and conditions in the Company's operating areas. FSC undertakes no 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.


News Article | January 16, 2017
Site: www.techtimes.com

The extinction of the dinosaurs is largely blamed on a giant asteroid that hit the Earth thousands of years ago. Now, a new study revealed how the darkness and cold that followed after the impact largely contributed to the mass extinction of the prehistoric animals. Global temperatures dropped after the massive Chicxulub asteroid hit Earth about 66 million years ago and the resulting extreme cold may have significantly reduced the odds of survival of the dinosaurs that managed to survive the impact. The findings highlighted the importance of climate in the survival of life forms on Earth. In a new study which was published in the journal Geophysical Research Letters on Jan. 13, Potsdam Institute for Climate Impact Research (PIK) researcher Julia Brugger and colleagues used computer simulations to create a map that showed how the world's temperatures changed after the asteroid struck. The researchers looked at how tiny droplets of sulphuric acid in the atmosphere influenced life on Earth. The droplets formed after the impact when sulphur dioxide combined with oxygen in the atmosphere. These droplets of sulphuric acid reflected the sunlight away. As a result, the sunlight was blocked for many years causing many plants on Earth to die which had profound impact on the food web. The computer simulations showed the droplets led to a period of cold and drastic changes to global temperatures. Prior to the impact, the Earth experienced the hottest global temperatures for a period spanning about 200 million years. From 27 degrees Celsius, the average tropical temperature dropped to just 5 degrees Celsius. The global annual mean surface temperature likewise got colder by at least 26 degrees Celsius. The dinosaurs thrived in a lush climate but following the asteroid impact, the annual average temperature plummeted to below freezing for a period of about three years. The ice caps expanded and it took the climate about 30 years to recover. "The long-term cooling caused by the sulfate aerosols was much more important for the mass extinction than the dust that stays in the atmosphere for only a relatively short time," said study author Georg Feulner, from PIK, adding that the long-term cooling had more important impact than the local events which include wildfires, tsunamis and extreme heat near the impact site. The cold also severely disturbed the marine ecosystem, which also had unwanted consequences. Surface water became denser and heavier because of the cold temperature and thus sank into depths. Warmer waters from deeper ocean layers though rose to the surface and carrying nutrients that may have boosted algal bloom. The algae could have produced toxic substances that may have further affected life at the coast. "The surface cooling triggered vigorous ocean mixing which could have resulted in a plankton bloom due to upwelling of nutrients," Brugger and colleagues wrote. "These dramatic environmental changes suggest a pivotal role of the impact in the end-Cretaceous extinction." © 2017 Tech Times, All rights reserved. Do not reproduce without permission.


PALO ALTO, Calif.--(BUSINESS WIRE)--Hercules Capital, Inc. (NYSE:HTGC) (“Hercules” or the “Company”), the leading specialty financing provider to innovative venture growth stage companies backed by leading venture capital firms, today announced its financial results for the fourth quarter and fiscal-year ended December 31, 2016. The Company announced that its Board of Directors has declared a fourth quarter cash distribution of $0.31 per share, that will be payable on March 13, 2017, to shareholders of record as of March 6, 2017. “2016 was an outstanding year for Hercules. We delivered consistently strong financial and operational results, which demonstrated the continued success of our premier venture lending franchise, culminating in several new historical records, and generating significant earnings spillover for the third consecutive year,” said Manuel A. Henriquez, founder, chairman and chief executive officer of Hercules. “Notably, we surpassed our full-year portfolio target of $1.35 billion in total debt investments, delivered remarkable fourth quarter operating performance on both a GAAP basis and on an adjusted basis with adjusted NII per share of $0.33 and adjusted NII margin of 53%, which excluded the benefit of our one-time litigation settlement, and maintained an outstanding adjusted return on average equity “ROAE” of 13.4%, driven by $219 million in new fundings. As a result of this success, combined with our considerably strong liquidity, we remain well positioned to continue growing our debt investment portfolio and have established a new portfolio target of $1.6 billion, subject to continued favorable market conditions.” Henriquez continued, “During 2015, we made the critical decision to invest in our future and strengthen our organization, which caused our NII to fall below our existing distribution. However, we believed in our team and our franchise, and made those critical investments and relied upon our distribution spill-over to ensure we would not need to cut our distribution attributed to the shortfall. As you can see today, that decision was the right one for the benefit of our shareholders, as our NII earnings grew 65% from $0.20 per share in Q1 2015 to an adjusted $0.33 in Q4 2016, while also building an earnings/distribution spill-over of approximately $0.43 for potential future distributions to our shareholders. By leveraging those key investments made in 2015 in both our infrastructure and our originations platform, it has allowed us to not only achieve the scale that drove our record results in 2016, but to continue to benefit our shareholders for years to come.” Henriquez added, “These results reflect the hard work and diligent execution of our underwriting team, which generated new fundings of over $680 million in 2016, leading to total net investment portfolio growth of over $259 million for the year, despite strong early loan repayments totaling approximately $324 million. Our sizeable and growing debt investment portfolio continues to exemplify our strong brand reputation and industry leadership position as the largest BDC venture lender. Looking forward, we maintain a solid deal pipeline that provides a number of new opportunities to prudently and selectively deploy capital in our target markets.” Henriquez concluded, “Finally, and in typical Hercules fashion, we continue to take proactive steps to focus on our business, strengthen our balance sheet and maintain access to liquidity for growth, at terms that are favorable for our shareholders. Within the first few weeks of 2017, we completed the issuance of a new Convertible Bond offering, which raised gross proceeds of $230 million and was upsized by more than 50 percent from an initial offering of $150 million due to the significant demand from institutional investors. This financing is not only accretive to shareholders, but expands our liquidity by an additional $115 million, after retiring our higher-cost notes of $110 million, and will allow us to continue our growth through mid-2017 and beyond. In addition, we have remained active with our equity ATM program during the first few weeks of 2017, having successfully issued nearly $50 million of common stock above NAV for the benefit of our shareholders. This additional liquidity further allows us to effectively manage our leverage and amplify our liquidity for continued growth in our investment portfolio.” Hercules had a strong Q4 2016, having successfully extended debt and equity commitments to thirteen (13) existing companies and nine (9) new companies, totaling $213.1 million, and gross fundings of $219.2 million. During the quarter, Hercules realized higher-than-anticipated unscheduled early principal repayments of $67.2 million, along with normal scheduled amortization of $33.3 million, or $100.5 million in total debt repayments. Net debt investment portfolio growth during the fourth quarter, on a cost basis, was $109.0 million, higher than our desired target, driven by a higher volume of newly funded commitments and milestone-based conversion of unfunded commitments. The Company’s total investment portfolio, (at cost and fair value) by category, quarter-over-quarter and year-over-year are highlighted below: As of December 31, 2016, 91.8% of the Company’s debt investments were in a “true first-lien” senior secured position. Effective Yields on our debt investment portfolio was 14.4% during Q4 2016, down slightly from the previous quarter of 14.6%, due to a lower level of unscheduled early debt repayments. We had $84.2 million of unscheduled early debt repayments in Q3 2016 compared to $67.2 million in Q4 2016, or a decrease of 20.2%. Our effective portfolio yields generally include the effects of fees and income accelerations attributed to early payoffs, and other one-time events. Our effective yields are materially impacted by elevated levels of unscheduled early principal repayments, and are derived by dividing total investment income by the weighted average earning investment portfolio assets outstanding during the quarter, which excludes non-interest earning assets such as warrants and equity investments. Core Yields were steady at 12.9% during Q4 2016, and within our 2016 expected normalized levels of 12.5% to 13.5%. We are anticipating that in 2017, our new expected normalized range to be 12.25 to 13.25%. Hercules defines Core Yield as yields that generally exclude any benefit from income related to early debt repayments attributed to the acceleration of unamortized income and prepayment fees, and includes income from expired commitments. Total investment income increased 20.6% for Q4 2016 to $47.5 million, compared to $39.4 million in Q4 2015. The increase is primarily attributable to debt investment portfolio growth, and a greater weighted average principal outstanding of the Company’s debt investment portfolio between the periods. Non-interest and fees expenses increased to $12.3 million in Q4 2016 versus $9.8 million for Q4 2015. The increase was primarily due to changes in variable compensation related to origination activities and stock-based compensation. Interest expense and fees were $10.1 million, compared to $9.5 million in Q4 2015. The increase was primarily due to the issuance of $149.9 million of our 6.25% 2024 Notes during the period, offset by the retirement of our Convertible Debt and paydowns on our 2019 Notes in the prior year. The Company had a weighted average cost of borrowings comprised of interest and fees, of 5.9% in Q4 2016 versus 6.2% during Q4 2015. The decrease was primarily related to a reduction in the acceleration of unamortized fees from the retirement of $60 million of our 7.0% 2019 Notes in 2015, offset by the issuance of $149.9 million of 6.25% 2024 Notes during 2016. NII for Q4 2016 increased to $33.1 million, or $0.43 per share, based on 76.9 million basic weighted average shares outstanding, compared to $20.1 million, $0.28 per share, based on 71.2 million basic weighted average shares outstanding in Q4 2015. Removing the one-time benefit of the litigation income of $8.0 million, our adjusted Q4 2016 performance was very strong at $25.1 million or $0.33 per share, which was a 25% improvement over Q4 2015. The increase is primarily attributable to the increase in the weighted average loan balance and the decrease in total operating expenses compared to the prior year period. DNOI, a non-GAAP measure, for Q4 2016 was $34.5 million or $0.45 per share, compared to $22.3 million, or $0.31 per share, in Q4 2015. The increase is primarily attributable to the one-time benefit of the litigation income, the increase in the weighted average loan balance offset by decrease in unscheduled early debt repayment fees and accelerations, as well as a slightly lower amount of stock-based compensation, compared to the prior year period. DNOI is a non-GAAP financial measure. The Company believes that DNOI provides useful information to investors and management because it measures Hercules’ operating performance, exclusive of employee stock compensation, which represents expense to the Company, but does not require settlement in cash. DNOI includes income from payment-in-kind, or “PIK”, and back-end fees that are generally not payable in cash on a regular basis, but rather at investment maturity. Hercules believes disclosing DNOI and the related per share measures are useful and appropriate supplements and not alternatives to GAAP measures for net operating income, net income, earnings per share and cash flows from operating activities. Since Hercules’ first origination activities commencing in October 2004, the aggregate net realized loss (including warrant and equity gains) on investments, through December 31, 2016, totaled ($2.3) million, on a GAAP basis. When compared to cumulative new debt commitments during the same period of over $6.5 billion, the net cumulative realized loss since inception represents approximately 4 basis points “bps” or 0.04% of cumulative debt commitments, or an effective approximate annualized loss rate of 0 bps or 0.00%. During Q4 2016, Hercules had net realized gains of $1.1 million, which consisted of gross realized gains of $1.6 million primarily from the sale of four equity positions. These gains were partially offset by gross realized losses of ($0.4) million primarily from the write-off of four warrants and equity investments. A break-down of the net unrealized appreciation/(depreciation) in the investment portfolio is highlighted below: During Q4 2016, we recorded ($19.9) million of net unrealized depreciation from our debt, equity and warrant investments. Approximately ($4.3) million was net unrealized depreciation on our debt investments. Approximately ($13.7) million was attributed to net unrealized depreciation on our equity investments and approximately ($2.0) million was attributed to net unrealized depreciation on our warrant investments primarily due to ($0.8) million of unrealized depreciation on our private portfolio companies and approximately ($1.4) million of unrealized depreciation on our public portfolio. The Company ended Q4 2016 with $203.0 million in available liquidity, including $13.0 million in unrestricted cash and cash equivalents, and $190.0 million in available credit facilities, subject to existing terms and advance rates and regulatory and covenant requirements. This was further enhanced by the $230 million Convertible Bond issued in early Q1 2017, which will partially be used to fully tender and retire our $110.4 million 7.00% 2019 Notes. During Q4 2016, Hercules sold 3.2 million shares of common stock under its At-the-Market “ATM” equity distribution agreement, for total accumulated net proceeds of $42.7 million, all accretive to net asset value. For 2016, Hercules sold 7.3 million shares of common stock for total net proceeds of $92.8 million, all issuances accretive to net asset value. During Q4 2016, we entered into the debt capital markets with our ATM debt distribution program, selling 317,125 of our par $25.00 bonds for total net proceeds of $8.0 million. As of December 31, 2016, Hercules has two committed credit facilities with Wells Fargo Capital Finance (“WFCF”), part of Wells Fargo & Company (NYSE: WFC) and Union Bank for $120.0 million and $75.0 million, respectively. The Wells Fargo and Union Bank Facilities both include an accordion feature that enables the Company to increase the existing facilities to a maximum value of $300.0 million and $200.0 million, respectively, or $500.0 million in aggregate. Pricing at December 31, 2016 under the Wells Fargo Facility and Union Bank Facility were both LIBOR+3.25% with no LIBOR floor. Total outstanding at the end of Q4 2016 was $5.0 million, which was fully repaid in January 2017. Hercules’ regulatory leverage, or debt to equity ratio, excluding our SBA debentures was 60.6%, as of December 31, 2016. Hercules’ GAAP leverage ratio, including our SBA debentures, was 84.7%, as of December 31, 2016. Hercules has an SEC order granting it exemptive relief, thereby allowing it to exclude from its regulatory leverage limitations (1:1) of all its outstanding SBA debentures of $190.2 million, providing the Company with the potential capacity to add leverage of $310.5 million to its balance sheet as of December 31, 2016, bringing the maximum potential leverage to $978.1 million, or 124.1% (1.24:1), if it had access to such additional leverage. As of December 31, 2016, the Company’s asset coverage ratio under our regulatory requirements as a business development company was 265.0%, excluding the SBIC debentures, as a result of our exemptive order from the SEC. Available Unfunded Commitments – Representing only 4.3% of debt investment balance, at cost The Company’s unfunded commitments and contingencies consist primarily of unused commitments to extend credit in the form of loans to select Company’s portfolio companies. A portion of these unfunded contractual commitments are dependent upon the portfolio company reaching certain milestones in order to gain access to additional funding. Furthermore, our credit agreements contain customary lending provisions that allow us relief from funding obligations for previously made commitments. In addition, since a portion of these commitments may also expire without being drawn, unfunded contractual commitments do not necessarily represent future cash requirements. As of December 31, 2016, the Company had $59.7 million of available unfunded commitments at the request of the portfolio company and unencumbered by any milestones, including undrawn revolving facilities, representing 4.3% of Hercules’ debt investment balance, at cost. This was decreased from the previous quarter of $73.9 million of available unfunded commitments at the request of the portfolio company or 5.8% of Hercules’ debt investment balance, at cost. Hercules finished Q4 2016 with $55.0 million in signed non-binding term sheets outstanding to four new companies. Since the close of Q4 2016 and as of February 20, 2017, Hercules closed debt and equity commitments of $72.9 million to new and existing portfolio companies, and funded $67.5 million. Signed non-binding term sheets are subject to satisfactory completion of Hercules’ due diligence and final investment committee approval process as well as negotiations of definitive documentation with the prospective portfolio companies. These non-binding term sheets generally convert to contractual commitments in approximately 90 days from signing. It is important to note that not all signed non-binding term sheets are expected to close and do not necessarily represent future cash requirements or investments. As of December 31, 2016, the Company’s net assets were $787.9 million, compared to $753.6 million at the end of Q3 2016, an increase of 4.6%. Net asset value per share increased to $9.90 on 79.6 million outstanding shares as of December 31, 2016, compared to $9.86 on 76.4 million outstanding shares as of September 30, 2016. The change in net assets and NAV per share was primarily attributed to the accretive issuance of equity under our ATM program above NAV, which was accretive at a price-to-book of 1.38x, and the change in unrealized depreciation in the Q4 2016. As of December 31, 2016, the weighted average grade of the debt investment portfolio, on a cost basis, was 2.41, compared to 2.32 as of September 30, 2016, based on a scale of 1 to 5, with 1 being the highest quality. Hercules’ policy is to generally adjust the grading down on its portfolio companies as they approach the need for additional equity capital, thereby increasing our Grade 3 rated investments. Our policy is to lower the grading on our portfolio companies as they approach the point in time when they will require additional equity capital. Additionally, we may downgrade our portfolio companies if they are not meeting our financing criteria or are underperforming relative to their respective business plans. Various companies in our portfolio will require additional funding in the near term or have not met their business plans and therefore have been downgraded until their funding is complete or their operations improve. The change in weighted average investment grading as of December 31, 2016 from September 30, 2016 is due to the increase in Grade 5 investments between the periods, primarily due to one portfolio company. As of December 31, 2016, grading of the debt investment portfolio at fair value, excluding warrants and equity investments, was as follows: As of December 31, 2016, the Company had five debt investments on non-accrual with a cumulative investment cost and approximate fair value of $43.9 million and $6.2 million, respectively, or 2.9% and 0.4% as a percentage of our total investment portfolio at cost and value, respectively. As of September 30, 2016, the Company had six debt investments on non-accrual with cumulative investment cost and fair value of approximately $46.2 million and $9.3 million, respectively. High Asset Sensitivity – Expected Increase in PRIME Rate Will Benefit Hercules Significantly – Will Help Drive Future Earnings Growth We have purposely constructed a very asset sensitive debt investment portfolio and have structured our debt borrowings for any eventual increases in market rates that may occur in the near future. With 92.1% of our debt investment portfolio being priced at floating interest rates as of December 31, 2016, with a Prime or LIBOR-based interest rate floor, coupled with 99.2% of our outstanding debt borrowings bearing fixed interest rates, this leads to higher net investment income to our shareholders. Based on our Consolidated Statement of Assets and Liabilities as of December 31, 2016, the following table shows the approximate annualized increase in components of net income resulting from operations of hypothetical base rate changes in interest rates, such as prime rate, assuming no changes in our debt investments and borrowings. These estimates are subject to change due to the impact from active participation in the Company’s equity ATM program. We expect each 25 bps increase in the Prime Rate to contribute approximately $1.9 million, or $0.02 per share, of net investment income annually. Hercules held equity positions in 58 portfolio companies with a fair value of $67.6 million and a cost basis of $81.6 million as of December 31, 2016. On a fair value basis, 25.5% or $17.3 million is related to existing public equity positions, primarily concentrated in Box, Inc., which had a fair value of $8.5 million, compared to a cost basis of $4.7 million, at December 31, 2016. Hercules held warrant positions in 140 portfolio companies with a fair value of $27.5 million and a cost basis of $45.0 million as of December 31, 2016. Hercules’ historical realized gross warrant/equity multiples generally range from 1.0x to 29.2x, with an average historical gross warrant/equity multiple of 3.74x and a weighted average fully realized internal rate of return (“IRR”) of approximately 24.2%. There can be no assurances that companies that have yet to complete their IPOs will do so. The Board of Directors has declared a fourth quarter cash distribution of $0.31 per share. This distribution would represent the Company’s 46th consecutive distribution declaration since its IPO, bringing the total cumulative distribution declared to date to $12.78 per share. The following shows the key dates of our fourth quarter 2016 distribution payment: Hercules' Board of Directors maintains a variable distribution policy with the objective of distributing four quarterly distributions in an amount that approximates 90% to 100% of the Company’s taxable quarterly income or potential annual income for a particular year. In addition, at the end of the year, the Company’s Board of Directors may choose to pay an additional special distribution, or fifth distribution, so that the Company may distribute approximately all its annual taxable income in the year it was earned, or it can elect to maintain the option to spill over the excess taxable income into the coming year for future distribution payments. The determination of the tax attributes of the Company's distributions is made annually as of the end of the Company's fiscal year based upon its taxable income for the full year and distributions paid for the full year. Therefore, a determination made on a quarterly basis may not be representative of the actual tax attributes of its distributions for a full year. Of the distributions declared during the quarter ended December 31, 2016, 100% were distributions derived from the Company’s current and accumulated earnings and profits. There can be no certainty to stockholders that this determination is representative of what the tax attributes of the Company’s 2016 distributions to stockholders will be. The table below summarizes our year-to-date closed and pending commitments as follows: Hercules has scheduled its fourth quarter and full-year 2016 financial results conference call for February 23, 2017 at 2:00 p.m. PST (5:00 p.m. EST). To listen to the call, please dial (877) 304-8957 (or (408) 427-3709 internationally) and reference Conference ID: 65328328 if asked, approximately 10 minutes prior to the start of the call. A taped replay will be made available approximately three hours after the conclusion of the call and will remain available for seven days. To access the replay, please dial (855) 859-2056 or (404) 537-3406 and enter the passcode 653283328. Hercules Capital, Inc. (NYSE: HTGC) (“Hercules”) is the leading and largest specialty finance company focused on providing senior secured venture growth loans to high-growth, innovative venture capital-backed companies in a broad variety of technology, life sciences and sustainable and renewable technology industries. Since inception (December 2003), Hercules has committed more than $6.5 billion to over 370 companies and is the lender of choice for entrepreneurs and venture capital firms seeking growth capital financing. Companies interested in learning more about financing opportunities should contact info@htgc.com, or call 650.289.3060. Hercules’ common stock trades on the New York Stock Exchange (NYSE) under the ticker symbol "HTGC." In addition, Hercules has three outstanding bond issuances of: This press release may contain “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. You should understand that under Section 27A(b)(2)(B) of the Securities Act of 1933, as amended, and Section 21E(b)(2)(B) of the Securities Exchange Act of 1934, as amended, or the Exchange Act, the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995 do not apply to forward-looking statements made in periodic reports we file under the Exchange Act. The information disclosed in this press release is made as of the date hereof and reflects Hercules most current assessment of its historical financial performance. Actual financial results filed with the SEC may differ from those contained herein due to timing delays between the date of this release and confirmation of final audit results. These forward-looking statements are not guarantees of future performance and are subject to uncertainties and other factors that could cause actual results to differ materially from those expressed in the forward-looking statements including, without limitation, the risks, uncertainties, including the uncertainties surrounding the current market volatility, and other factors the Company identifies from time to time in its filings with the SEC. Although Hercules believes that the assumptions on which these forward-looking statements are based are reasonable, any of those assumptions could prove to be inaccurate and, as a result, the forward-looking statements based on those assumptions also could be incorrect. You should not place undue reliance on these forward-looking statements. The forward-looking statements contained in this release are made as of the date hereof, and Hercules assumes no obligation to update the forward-looking statements for subsequent events. Distributable Net Operating Income, “DNOI” represents net investment income as determined in accordance with U.S. generally accepted accounting principles, or GAAP, adjusted for amortization of employee restricted stock awards and stock options. Hercules views DNOI and the related per share measures as useful and appropriate supplements to net operating income, net income, earnings per share and cash flows from operating activities. DNOI is a non-GAAP financial measure. The Company believes that DNOI provides useful information to investors and management because it serves as an additional measure of Hercules’ operating performance exclusive of employee restricted stock amortization, which represents expenses of the Company but does not require settlement in cash. DNOI does include paid-in-kind, or PIK, interest and back end fee income which are generally not payable in cash on a regular basis, but rather at investment maturity or when declared. DNOI should not be considered as an alternative to net operating income, net income, earnings per share and cash flows from operating activities (each computed in accordance with GAAP). Instead, DNOI should be reviewed in connection with net operating income, net income (loss), earnings (loss) per share and cash flows from operating activities in Hercules’ consolidated financial statements, to help analyze how Hercules’ business is performing. Net leverage ratio is calculated by deducting the outstanding cash at December 31, 2016 of $13.0 million from total debt of $667.7 million divided by our total equity of $787.9 million, resulting in a net leverage ratio of 83.1%. Net leverage ratio is a non-GAAP measure and is not intended to replace financial performance measures determined in accordance with GAAP. Rather, they are presented as additional information because management believes they are useful indicators of the current financial performance of the Company’s core businesses.


News Article | February 23, 2017
Site: globenewswire.com

Strong Fourth Quarter Drives Record Full Year GAAP Revenue of $123 Million, an Increase of 47% Initiates First Quarter and Full Year 2017 Financial Outlook LOS ANGELES, Feb. 23, 2017 (GLOBE NEWSWIRE) -- BlackLine, Inc. (Nasdaq:BL), a leading cloud-based provider of financial controls and automation solutions that enable Continuous Accounting, today announced financial results for the fourth quarter and full year ended December 31, 2016. Therese Tucker, Founder and CEO, stated, “We are proud to report a strong finish to another record year for BlackLine.  In 2016, we grew our revenue by 47%, expanded our customer base to over 1,700 customers globally and extended our reach with new products, partnerships and a strategic acquisition.” “BlackLine is transforming the way accounting and finance works,” added Tucker.  “Our reputation as a market leader and trusted advisor is driving increased adoption of our solutions around the globe.  As we continue to innovate, focus on our customer relationships and deliver value to finance and accounting professionals across enterprise and mid-market organizations, we believe we’re well positioned to deliver strong growth in 2017 and beyond.” Mark Partin, Chief Financial Officer, stated, “I am pleased with our financial performance for the fourth quarter and full year, which demonstrates the value of BlackLine’s solutions to our customers.  In fiscal 2016, we delivered record revenue, solid gross margins and improved free cash flow after adjusting for PIK interest.  The financial guidance we’re providing for 2017 reflects strong demand we see in the marketplace, the scale we are beginning to see in our financial model and our continued confidence in our long-term path.” Guidance for non-GAAP net loss and net loss per share does not include the impact of the benefit from income taxes that we were able to recognize as a result of the deferred tax liabilities associated with the intangible assets established upon the acquisition in the third quarter of 2016 of Runbook B.V. (the “Runbook Acquisition”), amortization of acquired intangible assets resulting from the acquisition of the Company by its principal stockholders in 2013 (the “2013 Acquisition”) and the Runbook Acquisition, stock-based compensation, the change in fair value of contingent consideration and the change in fair value of the common stock warrant liability.  Reconciliations of non-GAAP net loss and net loss per share guidance to the most directly comparable U.S. GAAP measures, or net loss and net loss per share, are not available on a forward-looking basis without unreasonable efforts due to the unpredictability and complexity of the charges excluded from non-GAAP net loss and net loss per share.  The Company expects the variability of the above changes could have a significant, and potentially unpredictable, impact on its future GAAP net loss and net loss per share. BlackLine, Inc. will hold a conference call to discuss its fourth quarter and full year results at 2:00 p.m. Pacific time on Thursday, February 23, 2017.  A live audio webcast will be accessible on BlackLine’s investor relations website at http://investors.blackline.com.  The call can also be accessed domestically at (844) 229-7595 and internationally at (314) 888-4260, passcode 58654241.  A telephonic replay will be available through Thursday, March 2, 2017 at (855) 859-2056 or (404) 537-3406, passcode 58654241.  A replay of the webcast will be available at http://investors.blackline.com for 12 months.  BlackLine has used, and intends to continue to use, its Investor Relations website as a means of disclosing material non-public information and for complying with its disclosure obligations under Regulation FD. BlackLine, Inc. is a provider of cloud-based solutions for Finance & Accounting (F&A) that automate, centralize and streamline financial close operations and other key F&A processes for large and midsize organizations.  BlackLine’s platform is used by over 1,700 customers worldwide, spanning approximately 167,000 users across 130+ countries. For more information about BlackLine, Inc., visit http://www.blackline.com/. This release and the conference call referenced above contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995.  In some cases, you can identify forward-looking statements by terminology such as “may,” “will,” “should,” “could,” “expect,” “plan,” anticipate,” “believe,” “estimate,” “predict,” “intend,” “potential,” “would,” “continue,” “ongoing” or the negative of these terms or other comparable terminology.  Forward-looking statements in this release and quarterly conference call include, but are not limited to, statements regarding BlackLine’s future financial and operational performance, including, without limitation, GAAP and non-GAAP guidance, our expectations for our business in 2017 and our ability to execute on our long-term plan, expectations regarding gross margin, revenue mix and operating expenses, the Company’s expectation that it will have positive cash flows in a specified time period, the impact of seasonality on the Company’s financial results, market opportunity, the demand for and benefits from the use of BlackLine’s current and future solutions, growth strategies including international expansion, customer growth, extension of distribution channels and product innovation, expectations regarding deal size, expectations for hiring new talent and the integration of Runbook, including its contributions to the Company’s financial performance. Any forward-looking statements contained in this press release or the quarterly conference call are based upon BlackLine’s historical performance and its current plans, estimates and expectations and are not a representation that such plans, estimates, or expectations will be achieved. Forward-looking statements are based on information available at the time those statements are made and/or management’s good faith beliefs and assumptions as of that time with respect to future events, and are subject to risks and uncertainties.  If any of these risks or uncertainties materialize or if any assumptions prove incorrect, actual performance or results may differ materially from those expressed in or suggested by the forward looking statements.  These risks and uncertainties include, but are not limited to risks related to the Company’s ability to attract new customers and expand sales to existing customers; the extent to which customers renew their subscription agreements; the Company’s ability to manage growth effectively, including additional headcount and entry into new geographies; the Company’s ability to provide successful enhancements, new features and modifications to its software solutions; the Company’s ability to develop new products and software solutions and the success of any new product and service introductions; the success of the Company’s strategic relationships with technology vendors and business process outsourcers; any breaches of the Company’s security measures; a disruption in the Company’s hosting network infrastructure; costs and reputational harm that could result from defects in the Company’s solution; the loss of any key employees; continued strong demand for the Company’s software in the United States, Europe, Asia Pacific and Latin America; the Company’s ability to compete as the financial close management provider for organizations of all sizes; the timing and success of solutions offered by competitors; changes in the proportion of the Company’s customer base that is comprised of enterprise or mid-sized organizations; the Company’s ability to expand its enterprise and mid-market sales teams and effectively manage its sales forces; failure to protect the Company’s intellectual property; the Company’s ability to integrate acquired businesses and technologies successfully or achieve the expected benefits of such transactions; unpredictable macro-economic conditions; seasonality; changes in current tax or accounting rules; cyber attacks and the risk that the Company’s security measures may not be sufficient to secure its customer or confidential data adequately; acts of terrorism or other vandalism, war or natural disasters; and other risks and uncertainties described in the other filings we make with the Securities and Exchange Commission from time to time, including the risks described under the heading “Risk Factors” in our  Quarterly Report on Form 10-Q for the quarter ended September 30, 2016 filed with the Securities and Exchange Commission on December 12, 2016. Additional information will also be set forth in our Annual Report on Form 10-K for the fiscal year ended December 31, 2016.  Forward-looking statements should not be read as a guarantee of future performance or results, and you should not place undue reliance on such statements.  Except as required by law, we do not undertake any obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future developments or otherwise. Use of Non-GAAP Financial Measures To supplement its consolidated financial statements, which are prepared and presented in accordance with U.S. generally accepted accounting principles, or GAAP, BlackLine has provided in this release and the quarterly conference call held on February 23, 2017 certain financial measures that have not been prepared in accordance with GAAP defined as “non-GAAP financial measures,” which include (i) non-GAAP revenues, (ii) non-GAAP gross profit and non-GAAP gross margin, (iii) non-GAAP operating expenses, (iv) non-GAAP loss from operations, (v) non-GAAP net loss and non-GAAP net loss per share, and (vi) free cash flow. BlackLine’s management uses these non-GAAP financial measures internally in analyzing its financial results and believes they are useful to investors, as a supplement to the corresponding GAAP measures, in evaluating BlackLine’s ongoing operational performance and trends and in comparing its financial measures with other companies in the same industry, many of which present similar non-GAAP financial measures to help investors understand the operational performance of their businesses.  However, it is important to note that the particular items BlackLine excludes from, or includes in, its non-GAAP financial measures may differ from the items excluded from, or included in, similar non-GAAP financial measures used by other companies in the same industry. Non-GAAP financial measures should not be considered in isolation from, or as a substitute for, financial information prepared in accordance with GAAP. Investors are encouraged to review the reconciliation of these non-GAAP measures to their most directly comparable GAAP financial measures. A reconciliation of the non-GAAP financial measures to such GAAP measures has been provided in the tables included as part of this press release. Non-GAAP Revenues. Non-GAAP revenues are defined as GAAP revenues adjusted for the impact of purchase accounting resulting from the Runbook Acquisition.  The Company believes that presenting non-GAAP revenues is useful to investors as it eliminates the impact of the purchase accounting adjustment to Runbook revenues to allow for a direct comparison of revenues between current and future periods. Non-GAAP Gross Profit and Non-GAAP Gross Margin.  Non-GAAP gross profit is defined as non-GAAP revenues less GAAP cost of revenue adjusted for the impact of purchase accounting resulting from the Runbook Acquisition, the amortization of acquired developed technology resulting from the 2013 Acquisition and the Runbook Acquisition, and stock-based compensation. Non-GAAP gross margin is defined as non-GAAP gross profit divided by non-GAAP revenues. BlackLine believes that presenting non-GAAP gross margin is useful to investors as it eliminates the impact of certain non-cash expenses and allows a direct comparison of gross margin between periods. Non-GAAP Operating Expenses.  Non-GAAP operating expenses include (a) non-GAAP sales and marketing expense, (b) non-GAAP research and development expense and (c) non-GAAP general and administrative expense.  Non-GAAP sales and marketing expense is defined as GAAP sales and marketing expense adjusted for the amortization of acquired intangibles resulting from the 2013 Acquisition and the Runbook Acquisition and stock-based compensation.  Non-GAAP research and development expense is defined as GAAP research and development expense adjusted for stock-based compensation.  Non-GAAP general and administrative expense is defined as GAAP general and administrative expense as adjusted for the amortization of acquired intangibles resulting from the 2013 Acquisition and Runbook Acquisition, stock-based compensation, change in fair value of contingent consideration and acquisition costs related to the Runbook Acquisition.  BlackLine believes that presenting each of the non-GAAP operating expenses is useful to investors as it eliminates the impact of certain non-cash expenses and allows a direct comparison of operating expenses between periods. Non-GAAP Loss from Operations. Non-GAAP loss from operations is defined as GAAP loss from operations adjusted for the impact of purchase accounting to revenues resulting from the Runbook Acquisition, the amortization of acquired intangible assets resulting from the 2013 Acquisition and the Runbook Acquisition, stock-based compensation, change in fair value of contingent consideration and acquisition costs related to the Runbook Acquisition. The Company believes that presenting non-GAAP loss from operations is useful to investors as it eliminates the impact of items that have been impacted by the 2013 Acquisition and the Runbook Acquisition, purchase accounting and other related costs in order to allow a direct comparison of loss from operations between all periods presented. Non-GAAP Net Loss. Non-GAAP net loss is defined as GAAP net loss adjusted for the impact of the benefit from income taxes that we were able to recognize as a result of the deferred tax liabilities associated with the intangible assets established upon the 2013 Acquisition and the Runbook Acquisition, the impact of purchase accounting to revenues resulting from the Runbook Acquisition, amortization of acquired intangible assets resulting from the 2013 Acquisition and the Runbook Acquisition, stock-based compensation, accretion of debt discount pertaining to the 2013 Term Loan, accretion of warrant discount relating to warrants issued in connection with the 2013 Term Loan, the change in the fair value of contingent consideration, the change in fair value of the common stock warrant liability and costs related to the Runbook Acquisition.  The Company believes that presenting non-GAAP net loss is useful to investors as it eliminates the impact of items that have been impacted by the 2013 Acquisition and the Runbook Acquisition, purchase accounting and other related costs in order to allow a direct comparison of net loss between all periods presented. Free Cash Flow. Free cash flow is defined as cash flows provided by (used in) operating activities less cash flows used in investing activities related to purchase of property and equipment and capitalized software development. BlackLine believes that presenting free cash flow is useful to investors as it provides a measure of the Company’s liquidity used by management to evaluate the amount of cash generated by the Company’s business including the impact of purchases of property and equipment and cost of capitalized software development. BlackLine has provided in this release and the quarterly conference call held on February 23, 2017 certain operating metrics, including (i) number of customers, (ii) number of users and (iii) dollar-based net revenue retention rate, which BlackLine uses to evaluate its business, measure its performance, identify trends affecting its business, formulate financial projections and make strategic decisions.  These operating metrics exclude the impact of Runbook licensed customers and users as these customers did not have an active subscription agreement with BlackLine as of December 31, 2016. Dollar-based Net Revenue Retention Rate.  Dollar-based net revenue retention rate is calculated as the implied monthly subscription and support revenue at the end of a period for the base set of customers from which the Company generated subscription revenue in the year prior to the calculation, divided by the implied monthly subscription and support revenue one year prior to the date of calculation for that same customer base. This calculation does not reflect implied monthly subscription and support revenue for new customers added during the one-year period but does include the effect of customers who terminated during the period.  Implied monthly subscription and support revenue is defined as the total amount of minimum subscription and support revenue contractually committed to, under each of BlackLine’s customer agreements over the entire term of the agreement, divided by the number of months in the term of the agreement.  BlackLine believes that dollar-based net revenue retention rate is an important metric to measure the long-term value of customer agreements and the Company’s ability to retain and grow its relationships with existing customers over time. Number of Customers. A customer is defined as an entity with an active subscription agreement as of the measurement date. In situations where an organization has multiple subsidiaries or divisions, each entity that is invoiced as a separate entity is treated as a separate customer. However, where an existing customer requests its invoice be divided for the sole purpose of restructuring its internal billing arrangement without any incremental increase in revenue, such customer continues to be treated as a single customer.  BlackLine believes that its ability to expand its customer base is an indicator of the Company’s market penetration and the growth of its business. Number of Users. Since BlackLine’s customers generally pay fees based on the number of users of its platform within their organization, the Company believes the total number of users is an indicator of the growth of its business.


CLEVELAND, OH--(Marketwired - February 13, 2017) - American Greetings Corporation ("American Greetings") and American Greetings' indirect parent holding company, Century Intermediate Holding Company 2 ("CIHC 2"), announced today the early results of the previously announced cash tender offer (the "Senior Notes Tender Offer") and consent solicitation (the "Consent Solicitation") with respect to any and all of the outstanding 7.375% Senior Notes due 2021 issued by American Greetings (the "Senior Notes") and cash tender offer (the "PIK Notes Tender Offer" and, collectively with the Senior Notes Tender Offer, the "Tender Offers" and, each, a "Tender Offer") for any and all of the outstanding 9.750%/10.500% Senior PIK Toggle Notes due 2019 issued by CIHC 2 (the "PIK Notes" and, collectively with the Senior Notes, the "Notes"). As of 5:00 p.m., New York City time, on February 10, 2017 (the "Early Tender Deadline"), according to Global Bondholder Services Corporation, the depositary and information agent in connection with the Tender Offers and the Consent Solicitation, tenders and the related consents (in the case of the Senior Notes) were received from holders of Notes and not validly withdrawn as outlined in the following table: Accordingly, American Greetings has received consents sufficient to approve the previously announced proposed amendments to the Indenture governing the Senior Notes (the "Indenture"). American Greetings and the trustee for the Senior Notes will enter into a supplemental indenture containing the proposed amendments to the Indenture. Such amendments will not become effective until the settlement date, which is expected to occur on February 16, 2017, and until American Greetings accepts the Senior Notes validly tendered and not withdrawn on or prior to the Early Tender Deadline. The Tender Offers will expire at Midnight, New York City time, on February 27, 2017, unless extended or earlier terminated by American Greetings or CIHC 2, as applicable (the "Expiration Date"). Subject to the terms and conditions of the Senior Notes Tender Offer, holders of Senior Notes who validly tendered and did not withdraw their Senior Notes on or prior to the Early Tender Deadline will be entitled to receive $1,041.13 per $1,000 principal amount of Senior Notes tendered, which includes the consent payment of $30 per $1,000 principal amount of Senior Notes tendered (the "Consent Payment"). Holders of Senior Notes who validly tender their Senior Notes after the Early Tender Deadline and on or prior to the Expiration Date will be entitled to receive $1,011.13 per $1,000 principal amount of Senior Notes tendered, subject to the terms and conditions of the Senior Notes Tender Offer, and will not be entitled to the Consent Payment. Subject to the terms and conditions of the PIK Notes Tender Offer, holders of PIK Notes who validly tendered and did not withdraw their PIK Notes on or prior to the Early Tender Deadline will be entitled to receive $1,012.75 per $1,000 principal amount of PIK Notes tendered, which includes the early tender payment of $30 per $1,000 principal amount of PIK Notes tendered (the "Early Tender Payment"). Holders of PIK Notes who validly tender their PIK Notes after the Early Tender Deadline and on or prior to the Expiration Date will be entitled to receive $982.75 per $1,000 principal amount of PIK Notes tendered, subject to the terms and conditions of the PIK Notes Tender Offer, and will not be entitled to the Early Tender Payment. In addition, holders whose Notes are accepted for purchase will be entitled to receive accrued and unpaid interest in cash from the last interest payment date applicable to the Notes to, but not including, the applicable payment date. Payment for Notes tendered prior to the Early Tender Deadline is expected to be February 16, 2017. Payment for Notes validly tendered after the Early Tender Date and accepted for purchase will be made promptly after the Expiration Date. The Tender Offers are conditioned upon the completion of American Greetings' new debt securities financing and the entry by American Greetings into a new senior secured credit agreement, as well as certain other customary conditions, but is not conditioned on the tender of any minimum principal amount of Senior Notes or PIK Notes, as applicable. American Greetings and CIHC 2 each expressly reserve the right in its sole discretion, subject to applicable law, at any time and from time to time, to (1) waive any and all conditions to the applicable Tender Offer prior to the applicable Expiration Date and accept all Notes previously tendered and not validly withdrawn pursuant to the applicable Tender Offer, and (2) amend, extend or, subject to certain conditions, terminate the applicable Tender Offer. The complete terms and conditions of the Tender Offers are described in, and qualified in their entirety by, the Offer to Purchase and Consent Solicitation Statement of American Greetings and the Offer to Purchase of CIHC 2, as applicable, each dated January 30, 2017, as well as related materials that are being distributed to holders of the Senior Notes and PIK Notes, as applicable. BofA Merrill Lynch is the dealer manager for the Tender Offers and solicitation agent for the Consent Solicitation. Questions regarding the Tender Offers and Consent Solicitation may be directed to BofA Merrill Lynch at 1-888-292-0070 (U.S. toll free) or 1-980-387-2113. Global Bondholder Services Corporation will act as information agent and depositary for the Tender Offers and the Consent Solicitation. Requests for documents may be directed to Global Bondholder Services Corporation at 1-866-807-2200 (U.S. toll free), or 1-212-430-3774 (for banks and brokers). This press release is for informational purposes only and is not an offer to buy, a solicitation of an offer to sell or a solicitation of consents with respect to any securities. The solicitation of offers to buy the Notes is only being made pursuant to the terms of the Offer to Purchase and Consent Solicitation Statement and Offer to Purchase, as applicable, and the related Letters of Transmittal. The Tender Offers and Consent Solicitation are not being made in any jurisdiction in which the making or acceptance thereof would not be in compliance with the securities, blue sky or other laws of such jurisdiction. None of American Greetings, CIHC 2, the dealer manager, the solicitation agent, the depositary or the information agent is making any recommendation as to whether or not holders should tender their Notes in connection with the Tender Offers and Consent Solicitation. As a leader in meaningful connections, American Greetings Corporation is a creator and manufacturer of innovative social expression products that assist consumers in making the world a more thoughtful and caring place. Founded in 1906, American Greetings' major greeting card lines are American Greetings, Carlton Cards, Gibson, Recycled Paper Greetings and Papyrus, and other paper product offerings include DesignWare party goods and American Greetings and Plus Mark gift-wrap and boxed cards. American Greetings also has one of the largest collections of greetings on the Web, including greeting cards available at Cardstore.com and electronic greeting cards available at AmericanGreetings.com. In addition to its product lines, American Greetings also creates and licenses popular character brands through the American Greetings Entertainment group. Headquartered in Cleveland, Ohio, American Greetings generates annual revenue of approximately $1.9 billion, and its products can be found in retail outlets worldwide. This press release contains statements that are forward-looking within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Forward looking statements are only predictions and are not guarantees of future performance. Investors are cautioned that any such forward-looking statements are and will be, as the case may be, subject to many risks, uncertainties and factors relating to American Greetings and CIHC 2 that may cause the actual results to be materially different from any future results expressed or implied in such forward-looking statements. Although American Greetings and CIHC 2 believe that the expectations and assumptions reflected in such forward-looking statements are reasonable based on information currently available to the management of American Greetings and CIHC 2, American Greetings and CIHC 2 cannot guarantee future results or events. Each of American Greetings and CIHC 2 expressly disclaims a duty to update any of the forward-looking statements contained herein.


News Article | February 22, 2017
Site: globenewswire.com

RALEIGH, N.C., Feb. 22, 2017 (GLOBE NEWSWIRE) -- Triangle Capital Corporation (NYSE:TCAP) (“Triangle” or the “Company”), a leading provider of capital to lower middle market companies, today announced its financial and operating results for the fourth quarter of 2016 and the full year of 2016. In commenting on the Company’s results, E. Ashton Poole, President and Chief Executive Officer, stated, “The fourth quarter represented a strong finish to the year for Triangle, with over $155 million of new investments.  Adjusting for previously announced one-time expense items, we were pleased to generate net investment income of $0.46 per share as compared to our dividend of $0.45 per share.  As we turn to 2017, we are excited by the robust level of activity we are seeing across many of our portfolio companies and also many the financial sponsors with which we work.  The recent approval of our third Small Business Investment Company license will help further position us as a leading provider of capital to companies operating in the lower middle market during 2017 and beyond.” Total investment income during the fourth quarter of 2016 was $31.2 million, compared to total investment income of $27.4 million for the third quarter of 2016.  The increase in our quarter-over-quarter total investment income resulted primarily from higher average portfolio loan balances in the fourth quarter and a $2.0 million increase in non-recurring income received during the fourth quarter. Net investment income during the fourth quarter of 2016 was $17.1 million, compared to net investment income of $15.8 million for the third quarter of 2016.  Net investment income per share during the fourth quarter of 2016 was $0.42, based on weighted average shares outstanding during the quarter of 40.4 million, compared to $0.42 per share during the third quarter of 2016, based on weighted average shares outstanding of 38.1 million.  Net investment income per share during the fourth quarter of 2016 excluding one-time compensation expenses was $0.46 per share. The Company’s net increase in net assets resulting from operations was $7.3 million during the fourth quarter of 2016, compared to $7.9 million during the third quarter of 2016.  The Company’s net increase in net assets resulting from operations was $0.18 per share during the fourth quarter of 2016, based on weighted average shares outstanding of 40.4 million, compared to $0.21 per share during the third quarter of 2016, based on weighted average shares outstanding of 38.1 million. For the year ended December 31, 2016, total investment income was $113.7 million, compared to total investment income of $121.3 million for the year ended December 31, 2015.  This change was primarily attributed to a $7.7 million decrease in non-recurring fee and dividend income. Net investment income for 2016 was $58.9 million, compared to net investment income of $71.6 million during 2015.  Net investment income per share during 2016 was $1.62, based on a weighted average share count of 36.4 million, compared to $2.16 per share during 2015, based on a weighted average share count of 33.2 million.  Net investment income per share during 2016 excluding one-time compensation expenses was $1.81 per share. The Company’s net increase in net assets resulting from operations during the year ended December 31, 2016, was $34.3 million, compared to $47.9 million for the year ended December 31, 2015.  The Company’s net increase in net assets resulting from operations was $0.94 per share during 2016, based on the Company’s weighted average shares outstanding of 36.4 million, compared to $1.44 per share in 2015, based on the Company’s weighted average shares outstanding of 33.2 million. The Company’s net asset value per share at December 31, 2016, was $15.13, based on total shares outstanding at December 31, 2016, of 40.4 million, compared to the Company’s net asset value per share at December 31, 2015, of $15.23, based on total shares outstanding at December 31, 2015, of 33.4 million.  As of December 31, 2016, the Company’s weighted average yield on all of its outstanding debt investments (other than non-accrual debt investments) was 11.7%, compared to 12.2% at December 31, 2015. Commenting on the Company’s liquidity position, Steven C. Lilly, Chief Financial Officer, stated, “Triangle ended the year with approximately $280 million of available liquidity, and the approval of the third SBIC license in January will provide up to $100 million of additional capacity for SBA-guaranteed debentures.  We are fortunate to have access to attractively priced capital to support our investment activities in 2017.” At December 31, 2016, the Company had cash and cash equivalents totaling $107.1 million and $173.0 million of available borrowing capacity under its $300.0 million senior credit facility. As of December 31, 2016, the Company had outstanding non-callable, fixed-rate SBA-guaranteed debentures totaling $250.0 million with a weighted average interest rate of 3.90%.  In addition, the third SBIC license that was approved in January of 2017 provides up to $100.0 million of additional borrowing capacity for SBA-guaranteed debentures. During the year ended December 31, 2016, the Company made sixteen new investments, including recapitalizations of existing portfolio companies, totaling $274.1 million, additional debt investments in eleven existing portfolio companies totaling $37.8 million and additional equity investments in ten existing portfolio companies totaling $7.5 million.  The Company had fourteen portfolio company loans repaid at par totaling $170.8 million, which resulted in realized gains totaling $1.4 million, and received normal principal repayments, partial loan repayments and PIK interest repayments totaling $41.1 million.  The Company converted subordinated debt investments in one portfolio company into an equity investment and recognized a net realized loss on such conversion totaling $1.6 million.  The Company wrote-off debt and equity investments in two portfolio companies and recognized realized losses on the write-offs of $18.7 million.  In addition, the Company received proceeds related to the sales of certain equity securities totaling $34.4 million and recognized net realized gains on such sales totaling $20.9 million. New investment transactions which occurred during the fourth quarter of 2016 are summarized as follows: In October, 2016, the Company made a $23.3 million investment in Fridababy Holdings, LLC ("Fridababy") consisting of unitranche debt and equity.  Fridababy markets and distributes baby products. In October, 2016, the Company made a $17.0 million investment in Del Real, LLC ("Del Real") consisting of subordinated debt and equity.  Del Real is a leading Hispanic refrigerated foods company. In October, 2016, the Company made a $16.3 million investment in Trademark Global LLC ("Trademark") consisting of subordinated debt and equity. Trademark is a distributor of consumer products through various e-commerce platforms. In November, 2016, the Company made a $15.0 million second lien debt investment in ProAmpac PG Borrower LLC (“ProAmpac”).  ProAmpac is a manufacturer of flexible packaging products. In November, 2016, the Company made a $2.0 million equity investment in Aden & Anais Holdings, Inc. (“Aden & Anais”).  Aden & Anais designs and distributes baby wraps, swaddling blankets and other products for newborn babies. In December, 2016, the Company made a $25.8 million investment in SCUF Gaming, Inc. (“SCUF”) consisting of unitranche debt and equity.  SCUF is the leading designer, manufacturer and e-commerce platform of sales of advanced feature, customized gaming controllers and accessories for use on PlayStation, Xbox and PC. In December, 2016, the Company made a $20.6 million investment in Lakeview Health Holding, Inc. (“Lakeview”) consisting of unitranche debt and equity.  Lakeview is a provider of substance abuse treatment services. In December, 2016, the Company made a $3.0 million subordinated debt investment in SCA Pharmaceuticals, LLC (“SCA”).  SCA provides sterile, compounded pharmaceutical products on an outsourced basis to acute care hospitals. In December, 2016, the Company made a $15.0 million second lien debt investment in IPS Structural Adhesives Holdings, Inc. (“IPS”).  IPS is a manufacturer of specialty adhesives and plumbing products. In December, 2016, the Company made a $6.0 million investment in All Metals Holdings, LLC (“All Metals”) consisting of subordinated debt and equity as part of a recapitalization financing. All Metals is a toll processer and value-added distributor of steel for automotive, building products, appliance, lawn & garden, energy and other end markets. New portfolio investments subsequent to year end are summarized as follows: In January, 2017, the Company made a $30.0 million investment in AM General, LLC (“AM General”) consisting of first and second lien debt.  AM General is the founder and sole producer of the High Mobility Multipurpose Wheeled Vehicle (“Humvee”). In January, 2017, the Company made a $20.0 million investment in Native Maine Operations, Inc. (“Native Maine”) consisting of revolving debt, term loan debt and equity. Native Maine is an independent fresh foodservice distributor in the state of Maine. In February, 2017, the Company made a $15.0 million second lien debt investment in REP WWEX Acquisition Parent, LLC (“REP WWEX”). REP WWEX is a non-asset based third-party logistics provider focused on serving small-to-medium sized businesses. The 2017 Annual Meeting of Stockholders of Triangle Capital Corporation will be held at the Woman’s Club of Raleigh, 3300 Woman’s Club Drive, Raleigh, North Carolina 27612 on Wednesday, May 3, 2017, at 8:30 a.m. (Eastern Time) for stockholders of record as of the close of business on February 22, 2017. Triangle has scheduled a conference call to discuss fourth quarter and full year 2016 operating and financial results for Thursday, February 23, 2017, at 9:00 a.m. ET. To listen to the call, please dial 877-312-5521 or 253-237-1143 approximately 10 minutes prior to the start of the call. A taped replay will be made available approximately two hours after the conclusion of the call and will remain available until February 27, 2017. To access the replay, please dial 855-859-2056 or 404-537-3406 and enter the passcode 60627669. Triangle’s quarterly and annual results conference call will also be available via a live webcast on the investor relations section of its website at http://ir.tcap.com/events.cfm. Access the website 15 minutes prior to the start of the call to download and install any necessary audio software. An archived webcast replay will be available on the Company's website until March 31, 2017. Triangle will post a brief, pre-recorded on-demand podcast on the investor relations section of the Company’s website after 4:00 p.m. ET on Wednesday, February 22, 2017, in conjunction with the filing of Triangle’s 10-K. The purpose of the podcast is to provide interested analysts and investors with meaningful statistical and financial information in advance of the participatory earnings call on Thursday, February 23, 2017. About Triangle Capital Corporation Triangle Capital Corporation (www.TCAP.com) invests capital in established companies in the lower middle market to fund growth, changes of control and other corporate events.  Triangle offers a wide variety of investment structures with a primary focus on mezzanine financing with equity components.  Triangle’s investment objective is to seek attractive returns by generating current income from debt investments and capital appreciation from equity related investments.  Triangle’s investment philosophy is to partner with business owners, management teams and financial sponsors to provide flexible financing solutions.  Triangle typically invests $5.0 million - $50.0 million per transaction in companies with annual revenues between $20.0 million and $300.0 million and EBITDA between $5.0 million and $75.0 million. Triangle has elected to be treated as a business development company under the Investment Company Act of 1940 ("1940 Act").  Triangle is required to comply with a series of regulatory requirements under the 1940 Act as well as applicable NYSE, federal and state laws and regulations.  Triangle has elected to be treated as a regulated investment company under the Internal Revenue Code of 1986.  Failure to comply with any of the laws and regulations that apply to Triangle could have a material adverse effect on Triangle and its stockholders. Forward-Looking Statements This press release may contain forward-looking statements regarding the plans and objectives of management for future operations. Any such forward-looking statements may involve known and unknown risks, uncertainties and other factors which may cause our actual results, performance or achievements to be materially different from future results, performance or achievements expressed or implied by any forward-looking statements. Forward-looking statements, which involve assumptions and describe our future plans, strategies and expectations, are generally identifiable by use of the words “may,” “will,” “should,” “expect,” “anticipate,” “estimate,” “believe,” “intend,” “target,” “goals,” “plan,” “forecast,” “project,” other variations on these words or comparable terminology, or the negative of these words. These forward-looking statements are based on assumptions that may be incorrect, and we cannot assure you that the projections included in these forward-looking statements will come to pass. Our actual results could differ materially from those expressed or implied by the forward-looking statements as a result of various factors, including the factors discussed in our annual reports on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K and other documents or reports that we in the future may file with the Securities and Exchange Commission (the “SEC”). Copies of any reports or documents we file with the SEC are publicly available on the SEC’s website at www.sec.gov, and stockholders may receive a hard copy of our completed audited financial statements free of charge upon request to the Company at 3700 Glenwood Avenue, Suite 530, Raleigh, NC 27612. We have based any forward-looking statements included in this press release on information available to us on the date of this press release, and we assume no obligation to update any such forward-looking statements, unless we are required to do so by applicable law. However, 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 subsequent annual reports on Form 10-K, quarterly reports on Form 10-Q and current reports on Form 8-K.


NEW YORK--(BUSINESS WIRE)--New Mountain Finance Corporation (NYSE:NMFC) (the "Company", "we", "us" or "our") today announced its financial results for the quarter and year ended December 31, 2016 and reported fourth quarter net investment income and adjusted net investment income1 of $0.34 per weighted average share. At December 31, 2016, net asset value (“NAV”) per share was $13.46, an increase of $0.18 per share from September 30, 2016, an increase of $0.38 per share from December 31, 2015. The Company also announced that its board of directors declared a first quarter dividend of $0.34 per share, which will be payable on March 31, 2017 to holders of record as of March 17, 2017. We believe that the strength of the Company’s unique investment strategy – which focuses on acyclical “defensive growth” companies that are well researched by New Mountain Capital, L.L.C. (“New Mountain”), a leading alternative investment firm, is underscored by continued stable credit performance. The Company has had only seven portfolio companies, representing approximately $93 million of the cost of all investments made since inception in October 2008, or approximately 2.2%, go on non-accrual. Robert Hamwee, CEO, commented: “ The fourth quarter represented another solid quarter of performance for NMFC. We covered our dividend and originated $222 million of investments. Additionally over the last twelve months, we are pleased to have maintained a steady portfolio yield while increasing book value.” “ As managers and as significant stockholders personally, we are pleased with the completion of another successful quarter and year, where we maintained our dividend and our book value continued to rise,” added Steven B. Klinsky, NMFC Chairman. “ We believe New Mountain’s strategic focus on acyclical “defensive growth” industries and on companies that we know well continues to prove a successful strategy and preserves asset value.” As of December 31, 2016, the Company’s NAV was approximately $938.6 million and its portfolio had a fair value of approximately $1,588.0 million in 79 portfolio companies, with a weighted average Yield to Maturity at Cost3 of approximately 11.1%. For the three months ended December 31, 2016, the Company made approximately $221.5 million of originations and commitments4. The $221.5 million includes approximately $101.7 million of investments in seven new portfolio companies and approximately $119.8 million of follow-on investments in ten portfolio companies held as of September 30, 2016. For the three months ended December 31, 2016, the Company had approximately $25.2 million of sales in five portfolio companies and cash repayments4 of approximately $169.2 million. The Company’s total adjusted investment income for the three months ended December 31, 2016 and 2015 were approximately $43.8 million and $42.0 million, respectively. For the three months ended December 31, 2016 and 2015, the Company’s total adjusted investment income consisted of approximately $36.3 million5 and $36.7 million5 in cash interest income from investments, respectively, prepayment penalties of approximately $1.0 million and $0.4 million, respectively, approximately $1.5 million and $1.0 million in payment-in-kind (“PIK”) interest income from investments, respectively, net amortization of purchase premiums/discounts of approximately $0.7 million and $0.7 million, respectively, PIK dividend income of approximately $1.0 million and $0.7 million, respectively, and approximately $3.3 million and $2.5 million in other income, respectively. The Company’s total net expenses after income tax expense for the three months ended December 31, 2016 and 2015 were approximately $20.8 million and $19.5 million, respectively. Total net expenses after income tax expense for the three months ended December 31, 2016 and 2015 consisted of approximately $7.9 million and $6.5 million, respectively, of costs associated with the Company’s borrowings and approximately $11.6 million and $11.1 million, respectively, in net management and incentive fees. Since the initial public offering (“IPO”), the base management fee calculation has deducted the borrowings under the New Mountain Finance SPV Funding, L.L.C. credit facility (the “SLF Credit Facility”). The SLF Credit Facility had historically consisted of primarily lower yielding assets at higher advance rates. As part of an amendment to the Company’s existing credit facilities with Wells Fargo Bank, National Association, the SLF Credit Facility merged with and into the New Mountain Finance Holdings, L.L.C. credit facility (the “Holdings Credit Facility”) on December 18, 2014. Post credit facility merger and to be consistent with the methodology since the IPO, New Mountain Finance Advisers BDC, L.L.C. (the “Investment Adviser”) will continue to waive management fees on the leverage associated with those assets that share the same underlying yield characteristics with investments that were leveraged under the legacy SLF Credit Facility, which as of December 31, 2016 and 2015 totaled approximately $297.3 million and $304.9 million, respectively. The Investment Adviser cannot recoup management fees that the Investment Advisor has previously waived. For the three months ended December 31, 2016 and 2015, management fees waived were approximately $1.1 million and $1.4 million, respectively. The Company’s net direct and indirect professional, administrative, other general and administrative and income tax expenses for the three months ended December 31, 2016 and 2015 were approximately $1.3 million and $1.9 million, respectively. For the three months ended December 31, 2016 and 2015, the Company recorded approximately ($18.9) million and $0.7 million of adjusted net realized (losses) gains, respectively, and $30.0 million and ($43.2) million of adjusted net changes in unrealized appreciation (depreciation) of investments and securities purchased under collateralized agreements to resell, respectively. For the three months ended December 31, 2016 and 2015, provision for taxes was approximately ($0.2) million and $0.0 million, respectively, related to differences between the computation of income for United States (“U.S.”) federal income tax purposes as compared to accounting principles generally accepted in the United States (“GAAP”). The Company’s total adjusted investment income and total pro forma adjusted investment income for the years ended December 31, 2016 and 2015 were approximately $168.0 million and $154.3 million, respectively. For the years ended December 31, 2016 and 2015, the Company’s total adjusted investment income and total pro forma adjusted investment income consisted of approximately $144.2 million5 and $134.8 million5 in cash interest income from investments, prepayment penalties of approximately $4.9 million and $3.6 million, respectively, approximately $4.3 million and $3.9 million in PIK interest income from investments, respectively, net amortization of purchase premiums/discounts of approximately $3.0 million and $2.4 million, respectively, cash dividend income of approximately $0.2 million and $0.2 million, respectively, PIK dividend income of approximately $3.2 million and $2.6 million, respectively, and approximately $8.2 million and $6.8 million in other income, respectively. The Company’s total net expenses and total pro forma net expenses after income tax expense for the years ended December 31, 2016 and 2015 were approximately $80.0 million and $71.5 million, respectively, excluding the reduction to the hypothetical capital gains incentive fee accrual of $0 and ($0.1) million, respectively. The hypothetical capital gains incentive fee is based upon the cumulative net Adjusted Realized Capital Gains (Losses)6 and the cumulative net Adjusted Unrealized Capital Appreciation (Depreciation)6 from inception through the end of the current period. Actual amounts paid to the Investment Adviser are consistent with the investment advisory and management agreement between the Company and the Investment Adviser (the “Investment Management Agreement”), and are based only on actual Adjusted Realized Capital Gains computed net of all Adjusted Realized Capital Losses and Adjusted Unrealized Capital Depreciation on a cumulative basis from inception through the end of each calendar year as if the entire portfolio was sold at fair value. Total net expenses and total pro forma net expenses after income tax expense for the years ended December 31, 2016 and 2015 consisted of approximately $28.4 million and $23.4 million, respectively, of costs associated with the Company’s borrowings and approximately $44.7 million and $41.3 million, respectively, in net management and incentive fees, excluding the reduction to the hypothetical capital gains incentive fee accrual of $0 and ($0.1) million, respectively. For the years ended December 31, 2016 and 2015, management fees waived were approximately $4.8 million and $5.2 million, respectively. The Company’s net direct and indirect professional, administrative, other general and administrative and income tax expenses for the years ended December 31, 2016 and 2015 were approximately $6.9 million and $6.8 million, respectively. For the years ended December 31, 2016 and 2015, the Company recorded approximately ($16.9) million in adjusted net realized losses and approximately ($13.4) million in pro forma adjusted net realized losses, respectively, and $40.0 million of adjusted net changes in unrealized appreciation of investments and securities purchased under collateralized agreements to resell and ($35.4) million of pro forma adjusted net changes in unrealized depreciation of investments and securities purchased under collateralized agreements to resell, respectively. For the years ended December 31, 2016 and 2015, benefit (provision) for taxes was approximately $0.6 million and ($1.2) million, related to differences between the computation of income for U.S. federal income tax purposes as compared to GAAP. As of December 31, 2016, the Company had cash and cash equivalents of approximately $45.9 million and total statutory debt outstanding of approximately $589.0 million7, which consisted of approximately $333.5 million of the $495.0 million of total availability on the Holdings Credit Facility, $10.0 million of the $122.5 million of total availability on the Company’s senior secured revolving credit facility (the “NMFC Credit Facility”), $155.5 million7 of convertible notes outstanding and $90.0 million of unsecured notes outstanding. Additionally, the Company had $121.7 million of SBA-guaranteed debentures outstanding as of December 31, 2016. The Company puts its largest emphasis on risk control and credit performance. On a quarterly basis, or more frequently if deemed necessary, the Company formally rates each portfolio investment on a scale of one to four. Each investment is assigned an initial rating of a “2” under the assumption that the investment is performing materially in-line with expectations. Any investment performing materially below our expectations would be downgraded from the “2” rating to a “3” or a “4” rating, based on the deterioration of the investment. An investment rating of a “4” could be moved to non-accrual status, and the final development could be an actual realization of a loss through a restructuring or impaired sale. During the fourth quarter of 2016, the Company placed a portion of its first lien position in Sierra Hamilton LLC / Sierra Hamilton Finance, Inc. ("Sierra") on non-accrual status due to its ongoing restructuring. As of December 31, 2016, the portion of the Sierra first lien position placed on non-accrual status represented an aggregate cost basis of $8.2 million and an aggregate fair value of $5.3 million. During the second quarter of 2016, the Company placed a portion of its first lien position in Permian Tank & Manufacturing, Inc. (“Permian”) on non-accrual status due to its ongoing restructuring, which was completed in October 2016. Post restructuring, the Company’s investments in Permian have been restored to full accrual status. As of December 31, 2016, two portfolio companies (including Sierra referenced above) had an investment rating of “3”, with a total cost basis of approximately $20.6 million and a fair value of approximately $12.6 million. As of December 31, 2016, three portfolio companies (including Sierra referenced above) had an investment rating of “4”. As of December 31, 2016, the Company’s investments in these portfolio companies had an aggregate cost basis of approximately $39.4 million and an aggregate fair value of approximately $9.6 million. The Company has had approximately $135.8 million of originations and commitments since the end of the fourth quarter through February 24, 2017. This was offset by approximately $44.6 million of repayments and $17.5 million of sales during the same period. On January 12, 2017, the United States Small Business Administration (the “SBA”) issued a "green light" letter inviting the Company to continue its application process to obtain a second license to form and operate a second small business investment company (“SBIC”) subsidiary. If approved, the additional SBIC license would provide the Company with an incremental source of attractive long-term capital. Receipt of a green light letter from the SBA does not assure an applicant that the SBA will ultimately issue an SBIC license and the Company has received no assurance or indication from the SBA that it will receive an additional SBIC license, or of the timeframe in which it would receive an additional license, should one ultimately be granted. On February 23, 2017, the Company’s board of directors declared a first quarter 2017 distribution of $0.34 per share payable on March 31, 2017 to holders of record as of March 17, 2017. Use of Non-GAAP Financial Measures In evaluating its business, NMFC considers and uses adjusted net investment income as a measure of its operating performance. Adjusted net investment income is defined as net investment income adjusted to reflect income as if the cost basis of investments held at NMFC’s IPO date had stepped-up to fair market value as of the IPO date. Under GAAP, NMFC’s IPO did not step-up the cost basis of the predecessor operating company’s existing investments to fair market value. Since the total value of the predecessor operating company’s investments at the time of the IPO was greater than the investments’ cost basis, a larger amount of amortization of purchase or issue discount, and different amounts in realized gains and unrealized appreciation, may be recognized under GAAP in each period than if a step-up had occurred. For purposes of the incentive fee calculation, NMFC adjusts income as if each investment was purchased at the date of the IPO (or stepped-up to fair market value). In addition, adjusted net investment income excludes any capital gains incentive fee. The term adjusted net investment income is not defined under GAAP and is not a measure of operating income, operating performance or liquidity presented in accordance with GAAP. Adjusted net investment income has limitations as an analytical tool and, when assessing NMFC’s operating performance, and that of its portfolio companies, investors should not consider adjusted net investment income in isolation, or as a substitute for net investment income, or other consolidated income statement data prepared in accordance with GAAP. Among other things, adjusted net investment income does not reflect NMFC’s, or its portfolio companies’, actual cash expenditures. Other companies may calculate similar measures differently than NMFC, limiting their usefulness as comparative tools. New Mountain Finance Corporation will host a conference call at 10 a.m. Eastern Time on Wednesday, March 1, 2017, to discuss its fourth quarter 2016 financial results. All interested parties may participate in the conference call by dialing +1 (877) 443-9109 approximately 15 minutes prior to the call. International callers should dial +1 (412) 317-1082. This conference call will also be broadcast live over the Internet and can be accessed by all interested parties through the Company's website, http://ir.newmountainfinance.com. To listen to the live call, please go to the Company's website at least 15 minutes prior to the start of the call to register and download any necessary audio software. Following the call, you may access a replay of the event via audio webcast on our website. We will be utilizing a presentation during the conference call and we have posted the presentation to the investor relations section of our website. New Mountain Finance Corporation is a closed-end, non-diversified and externally managed investment company that has elected to be regulated as a business development company under the Investment Company Act of 1940, as amended. The Company’s investment objective is to generate current income and capital appreciation through the sourcing and origination of debt securities at all levels of the capital structure, including first and second lien debt, notes, bonds and mezzanine securities. In some cases, the investments may also include small equity interests. The Company’s investment activities are managed by its Investment Adviser, New Mountain Finance Advisers BDC, L.L.C., which is an investment adviser registered under the Investment Advisers Act of 1940, as amended. More information about New Mountain Finance Corporation can be found on the Company’s website at http://www.newmountainfinance.com. New Mountain Capital, L.L.C. is a New York-based alternative investment firm investing for long-term capital appreciation through direct investments in growth equity transactions, leveraged acquisitions, and management buyouts. The firm currently manages private and public equity funds with more than $15.5 billion in aggregate capital commitments. New Mountain Capital, L.L.C. seeks out the highest-quality defensive growth leaders in carefully selected industry sectors and then works intensively with management to build the value of these companies. For more information on New Mountain Capital, L.L.C., please visit http://www.newmountaincapital.com. Statements included herein may contain “forward-looking statements”, which relate to our future operations, future performance or our financial condition. Forward-looking statements are not guarantees of future performance, condition or results and involve a number of risks and uncertainties. Actual results and outcomes may differ materially from those anticipated in the forward-looking statements as a result of a variety of factors, including those described from time to time in our filings with the Securities and Exchange Commission or factors that are beyond our control. New Mountain Finance Corporation undertakes no obligation to publicly update or revise any forward-looking statements made herein. All forward-looking statements speak only as of the time of this press release.


News Article | February 15, 2017
Site: www.businesswire.com

BETHESDA, Md.--(BUSINESS WIRE)--Centrus Energy Corp. (NYSE MKT: LEU) (the “Company”) announced the settlement of its previously announced private exchange offer (the “Exchange Offer”) to exchange any and all of the Company’s 8.0% PIK toggle notes due 2019/2024 (the “Outstanding Notes”) for up to (i) $85 million 8.25% senior secured notes due 2027 guaranteed on a subordinated and limited basis by the Company’s subsidiary, United States Enrichment Corporation (the “New Notes”), (ii) $120 million liquidation amount of 7.5% cumulative redeemable preferred stock (the “Preferred Stock”), and (iii) $30 million in cash. According to information provided by the exchange agent and information agent for the Exchange Offer and Consent Solicitation, as of 11:59 p.m., New York City time, on February 9, 2017 (the "Expiration Date"), the Company had received tenders from holders of $204,944,468 in aggregate principal amount of the Outstanding Notes, representing approximately 87.4% of the total outstanding principal amount of the Outstanding Notes. “This represents a major step forward for Centrus,” said Centrus President and CEO Daniel B. Poneman. “One of our top priorities has been to deleverage the company. By cutting the face amount of our long-term debt burden by more than half and extending the maturity of the new debt to 2027, we believe that we will be better able to deliver on our strategic initiatives to grow and diversify our company, while continuing to satisfy the long-term needs of our customers.” “We thank our stakeholders who participated in this effort for their continued support of Centrus.” All holders who tendered prior to the Expiration Date received $362.36 principal amount of New Notes, $509.75 liquidation preference of Preferred Stock and a cash payment of $127.89 in exchange for each $1,000 principal amount of Outstanding Notes validly tendered and accepted for exchange by the Company pursuant to the Exchange Offer. For each $1,000 principal amount of Outstanding Notes validly tendered on or prior to the “Early Tender Date” of 11:59 p.m., New York City time, on February 2, 2017 and not validly withdrawn, holders received an additional “Early Tender Premium” equal to a cash payment of $7.50. All conditions to the Exchange Offer and Consent Solicitation have been satisfied or waived, including the receipt of valid consents from the holders of a majority of the outstanding principal amount of the Outstanding Notes to the proposed amendments to the indenture for the Outstanding Notes. The Company issued an aggregate of $74,263,580 principal amount of New Notes, 104,574 shares of Preferred Stock with aggregate liquidation preference of $104,574,000 and $27,560,110 in cash in the Exchange Offer. Immediately following settlement, $29,630,036 aggregate principal amount of Outstanding Notes remained outstanding. The New Notes, the Guarantee and the Preferred Stock will not be registered under the Securities Act of 1933, as amended (the “Securities Act”), and may not be transferred or sold in the United States absent registration or an applicable exemption from the registration requirements of the Securities Act. This press release shall not constitute an offer to sell or the solicitation of an offer to buy any security. This news release contains “forward-looking statements” within the meaning of Section 21E of the Securities Exchange Act of 1934 - that is, statements related to future events. In this context, forward-looking statements may address our expected future business and financial performance, and often contain words such as “expects”, “anticipates”, “intends”, “plans”, “believes”, “will”, “should”, “could”, “would” or “may” and other words of similar meaning. Forward-looking statements by their nature address matters that are, to different degrees, uncertain. For Centrus Energy Corp., particular risks and uncertainties that could cause our actual future results to differ materially from those expressed in our forward-looking statements include, risks and uncertainties related to the limited trading markets in our securities; risks related to our ability to maintain the listing of our common stock on the NYSE MKT LLC; the continued impact of the March 2011 earthquake and tsunami in Japan on the nuclear industry and on our business, results of operations and prospects; the impact and potential extended duration of the current supply/demand imbalance in the market for low-enriched uranium (“LEU”); risks related to actions that may be taken by the U.S. government, the Russian government or other governments that could affect our ability or the ability of our sources of supply to perform under contract obligations, including the imposition of sanctions, restrictions or other requirements; the impact of government regulation including by the U.S. Department of Energy and the U.S. Nuclear Regulatory Commission; the outcome of legal proceedings and other contingencies (including lawsuits and government investigations or audits); risks relating to our sales order book, including uncertainty concerning customer actions under current contracts and in future contracting due to market conditions and lack of current production capability; risks associated with our reliance on third-party suppliers to provide essential products or services to us; pricing trends and demand in the uranium and enrichment markets and their impact on our profitability; uncertainty regarding our ability to commercially deploy competitive enrichment technology; risks and uncertainties regarding funding for the American Centrifuge project and our ability to perform under our agreement with UT-Battelle, LLC, the management and operating contractor for Oak Ridge National Laboratory, for continued research and development of the American Centrifuge technology; the competitive environment for our products and services; the potential for further demobilization or termination of the American Centrifuge project; risks related to the current demobilization of the portions of the American Centrifuge project including risks that the schedule could be delayed and costs could be higher than expected; the timing, savings and execution of any potential restructurings; potential strategic transactions, which could be difficult to implement, disrupt our business or change our business profile significantly; changes in the nuclear energy industry; the impact of financial market conditions on our business, liquidity, prospects, pension assets and insurance facilities; revenue and operating results can fluctuate significantly from quarter to quarter, and in some cases, year to year; and other risks and uncertainties discussed in this and our other filings with the Securities and Exchange Commission, including our Annual Report on Form 10-K for the fiscal year ended December 31, 2015 and subsequent Quarterly Reports on Form 10-Q, which are available on our website at www.centrusenergy.com. We do not undertake to update our forward-looking statements except as required by law.


News Article | February 28, 2017
Site: www.businesswire.com

LONDON--(BUSINESS WIRE)--The first quarter results for FY17 (to 30 September 2017) for Lion/Gem Luxembourg 3 S.a.r.l. (associated with Young’s Seafood Limited) will be made available on our Investor Relations website on February 28, 2017. The First Quarter FY17 Call for investors that accompanies this information is scheduled to take place at 13:00 GMT on February 28, 2017. If you are an investor or a potential investor in the 8¼%/ 9% Senior PIK Notes due 2019, of Lion/Gem Luxembourg 3 S.a.r.l., and would like access to this information, please register your interest on our Investor Relations website: https://youngsseafood.co.uk/investors/ If you have any questions about the registration process or need further information, please do not hesitate to contact Nicholas Donnelly, Communications Manager at Young’s Seafood: This announcement contains inside information by Lion/Gem Luxembourg 3 S.a.r.l. under Regulation (EU) 596/2014 (16 April 2014).

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