American Capital Reports $0.17 Per Diluted Share Net Operating Income and $0.65 Per Diluted Share Net Earnings
BETHESDA, Md., May 4 /PRNewswire-FirstCall/ -- American Capital, Ltd. (“ACAS” or the “Company”) (Nasdaq: ACAS) announced net operating income (“NOI”) for the quarter ended March 31, 2010 of $49 million, or $0.17 per diluted share. Net earnings (loss) less appreciation and (depreciation) (“Net Realized Loss”) for the quarter was $(77) million, or $(0.27) per diluted share. For the quarter ended March 31, 2010, the Company reported net earnings of $187 million, or $0.65 per diluted share.
Q1 2010 FINANCIAL SUMMARY
- $49 million NOI
- $357 million net unrealized appreciation of portfolio investments
- $(107) million net realized loss on portfolio investments
- $187 million net earnings
- $734 million improvement over Q1 2009
- $163 million of cash proceeds from realizations
- $8.98 net asset value (“NAV”) per share
- $0.69 per share, or 8%, improvement over Q4 2009 NAV per share of $8.29
- $8.31 pro forma NAV per share as adjusted for April 2010 $295 million equity offering
- $820 million of unrestricted cash and cash equivalents as of March 31, 2010
- $1.2 billion of unrestricted cash and cash equivalents as of April 30, 2010
“We’ve certainly seen progress in this past year in the economy, the capital markets and our performance,” said Malon Wilkus, Chairman and Chief Executive Officer. “We believe the economic recovery is well underway and that’s reflected in the performance of our investments. We have now experienced three consecutive quarters of net unrealized appreciation of our portfolio investments after two years of net unrealized depreciation. We are optimistic that if the economy and capital markets continue to improve, we should see the improvement reflected in our asset valuations and net asset value.”
NET OPERATING INCOME
NOI decreased to $49 million, or $0.17 per diluted share, for the quarter ended March 31, 2010 compared to $64 million, or $0.31 per diluted share, for the comparable quarter in 2009.
NET REALIZED LOSS
Net Realized Loss increased to $(77) million, or $(0.27) per diluted share, for the quarter ended March 31, 2010 compared to $(55) million, or $(0.27) per diluted share, for the comparable quarter in 2009.
NET EARNINGS (LOSS)
Net earnings (loss) improved to $187 million, or $0.65 per diluted share, for the quarter ended March 31, 2010 compared to $(547) million, or $(2.65) per diluted share, for the comparable quarter in 2009.
PORTFOLIO VALUATION
For the quarter ended March 31, 2010, net unrealized appreciation of investments totaled $264 million. The primary components of the net unrealized appreciation were:
- $50 million of appreciation on American Capital’s investment in European Capital Limited primarily due to appreciation in the NAV of European Capital Limited offset by $15 million of foreign currency net depreciation on the investment;
- The equity investment in European Capital is valued at $0.3 billion compared to European Capital’s NAV of approximately $0.8 billion.
- $111 million of net appreciation of American Capital’s private finance portfolio primarily a result of improved portfolio company performance and improved multiples; and
- $103 million of reversals of prior unrealized depreciation associated with net realized losses on portfolio investments.
As of March 31, 2010, NAV per share was $8.98, an increase of $0.69 per share from a NAV per share of $8.29 as of December 31, 2009.
“In April, we raised $295 million of our equity at an approximately 5% discount to our closing price from institutions that have significant experience investing in financial institutions. We will put this new capital to work investing in new and existing portfolio companies, debt repayment and general corporate purposes,” said John Erickson, Chief Financial Officer. “This is a strong vote of confidence in our ability to grow shareholder value. This new capital plus asset appreciation, together with additional liquidity events has increased our cash balance to $1.2 billion, improved our asset coverage ratio and strengthened our balance sheet.”
PORTFOLIO LIQUIDITY AND PERFORMANCE
In the first quarter of 2010, $163 million of cash proceeds were received from realizations of portfolio investments and exits, which were 3.7% lower than the prior quarter’s valuations of the investments. There was $84 million in new committed investments during the quarter. The weighted average effective interest rate on the Company’s private finance debt investments as of March 31, 2010 was 10.3%, 40 basis points higher than as of December 31, 2009. Unrestricted cash and cash equivalents totaled $820 million as of March 31, 2010 and $1.2 billion as of April 30, 2010.
As of March 31, 2010, loans with a fair value of $263 million were on non-accrual representing 7.0% of total loans at fair value, compared to $290 million fair value of non-accrual loans representing 7.8% of total loans at fair value as of December 31, 2009.
AMERICAN CAPITAL, LTD. CONSOLIDATED BALANCE SHEETS As of March 31, 2010, December 31, 2009 and March 31, 2009 (in millions, except per share amounts) Q1 Q4 Q1 2010 2010 2009 Versus Q4 2009 ---- ---- -------------- (unaudited) $ % Assets --- --- Investments at fair value (cost of $9,013, $9,158 and $10,707, respectively) $5,698 $5,575 $123 2% Cash and cash equivalents 820 835 (15) -2% Restricted cash and cash equivalents 79 96 (17) -18% Interest receivable 39 38 1 3% Derivative agreements at fair value 2 1 1 100% Other 119 127 (8) -6% --- --- -- -- Total assets $6,757 $6,672 $85 1% ===== ===== == == Liabilities and Shareholders' Equity Debt $4,026 $4,142 $(116) -3% Derivative agreements at fair value 109 102 7 7% Other 96 99 (3) -3% -- -- -- -- Total liabilities 4,231 4,343 (112) -3% ----- ----- --- -- Commitments and contingencies Shareholders' equity Undesignated preferred stock, $0.01 par value, 5.0 shares authorized, 0 issued and outstanding - - - 0% Common stock, $0.01 par value, 1,000.0 shares authorized, 292.9, 292.9 and 225.8 issued and 281.3, 280.9 and 215.4 outstanding, respectively 3 3 - 0% Capital in excess of par value 6,745 6,735 10 0% (Distributions in excess of) undistributed net realized earnings (786) (709) (77) -11% Net unrealized depreciation of investments (3,436) (3,700) 264 7% ----- ----- --- -- Total shareholders' equity 2,526 2,329 197 8% ----- ----- --- -- Total liabilities and shareholders' equity $6,757 $6,672 $85 1% ===== ===== == == Net asset value per common share $8.98 $8.29 $0.69 8% ==== ==== ==== == Q1 2010 Versus Q1 2009 Q1 2009 ------- ------- (unaudited) $ % Assets --- --- Investments at fair value (cost of $9,013, $9,158 and $10,707, respectively) $6,839 $(1,141) -17% Cash and cash equivalents 88 732 832% Restricted cash and cash equivalents 68 11 16% Interest receivable 44 (5) -11% Derivative agreements at fair value 10 (8) -80% Other 162 (43) -27% --- --- --- Total assets $7,211 $(454) -6% ===== ==== == Liabilities and Shareholders' Equity Debt $4,377 $(351) -8% Derivative agreements at fair value 102 7 7% Other 78 18 23% -- -- -- Total liabilities 4,557 (326) -7% ----- --- -- Commitments and contingencies Shareholders' equity Undesignated preferred stock, $0.01 par value, 5.0 shares authorized, 0 issued and outstanding - - 0% Common stock, $0.01 par value, 1,000.0 shares authorized, 292.9, 292.9 and 225.8 issued and 281.3, 280.9 and 215.4 outstanding, respectively 2 1 50% Capital in excess of par value 6,591 154 2% (Distributions in excess of) undistributed net realized earnings 21 (807) NM Net unrealized depreciation of investments (3,960) 524 13% ----- --- -- Total shareholders' equity 2,654 (128) -5% ----- --- -- Total liabilities and shareholders' equity $7,211 $(454) -6% ===== === == Net asset value per common share $12.32 $(3.34) -27% ===== ==== === AMERICAN CAPITAL, LTD. CONSOLIDATED STATEMENTS OF OPERATIONS Three Months Ended March 31, 2010 and 2009 (in millions, except per share data) (unaudited) Three Months Ended Three Months Ended March 31, March 31, 2010 Versus 2009 2010 2009 $ % ---- ---- --- --- OPERATING INCOME Interest and dividend income $150 $179 $(29) -16% Fee income 14 16 (2) -13% --- --- --- --- Total operating income 164 195 (31) -16% --- --- --- --- OPERATING EXPENSES Interest 57 52 5 10% Salaries, benefits and stock-based compensation 34 53 (19) -36% General and administrative 24 26 (2) -8% -- -- -- -- Total operating expenses 115 131 (16) -12% --- --- --- --- NET OPERATING INCOME 49 64 (15) -23% --- --- --- --- Net gain on extinguishment of debt - 12 (12) -100% --- --- --- ---- Net realized loss on investments Portfolio company investments (107) (79) (28) -35% Foreign currency transactions (3) (2) (1) -50% Derivative agreements and option agreements (16) (50) 34 68% --- --- --- --- Total net realized loss on investments (126) (131) 5 4% ---- ---- --- --- NET REALIZED LOSS (77) (55) (22) -40% --- --- --- --- Net unrealized appreciation (depreciation) of investments Portfolio company investments 357 (525) 882 NM Foreign currency translation (87) (69) (18) -26% Derivative and option agreements (6) 102 (108) NM --- --- --- --- Total net unrealized appreciation (depreciation) of investments 264 (492) 756 NM --- ---- --- --- NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS ("NET EARNINGS (LOSS)") $187 $(547) $734 NM ==== ===== ==== === NET OPERATING INCOME PER COMMON SHARE* Basic $0.17 $0.31 $(0.14) -45% Diluted $0.17 $0.31 $(0.14) -45% NET REALIZED LOSS PER COMMON SHARE* Basic $(0.27) $(0.27) $- 0% Diluted $(0.27) $(0.27) $- 0% NET EARNINGS (LOSS) PER COMMON SHARE* Basic $0.66 $(2.65) $3.31 NM Diluted $0.65 $(2.65) $3.30 NM WEIGHTED AVERAGE SHARES OF COMMON STOCK OUTSTANDING Basic 283.7 206.6 77.1 37% Diluted 286.0 206.6 79.4 38% DIVIDENDS DECLARED PER COMMON SHARE $- $- $- 0% NM = Not meaningful. * May not recalculate due to rounding. AMERICAN CAPITAL, LTD. OTHER FINANCIAL INFORMATION Three Months Ended March 31, 2010, December 31, 2009 and March 31, 2009 (in millions, except per share data) (Unaudited) Q1 2010 Versus Q4 2009 ---------------------- Q1 2010 Q4 2009 $ % ------- ------- --- --- Assets Under Management American Capital Assets at Fair Value(1) $6,757 $6,672 $85 1% Externally Managed Assets at Fair Value(2) 6,967 5,802 1,165 20% ----- ----- ----- --- Total $13,724 $12,474 $1,250 10% ======= ======= ====== === Capital Resources Under Management American Capital Assets at Fair Value plus Available Capital Resources(1) $6,757 $6,672 $85 1% Externally Managed Assets at Fair Value plus Available Capital Resources(2) 7,185 6,020 1,165 19% ----- ----- ----- --- Total $13,942 $12,692 $1,250 10% ======= ======= ====== === New Investments Senior Debt $- $12 $(12) -100% Subordinated Debt 81 - 81 100% Preferred Equity 1 4 (3) -75% Common Equity 2 7 (5) -71% --- --- --- --- Total $84 $23 $61 265% === === === === Add-on Financing for Working Capital in Distressed Situations $8 $17 $(9) -53% Add-on Financing for Acquisitions - 3 (3) -100% Add-on Financing for Growth and Working Capital 1 2 (1) -50% Add-on Financing for Recapitalizations 75 1 74 NM --- --- --- --- Total $84 $23 $61 265% === === === === Realizations Principal Prepayments $90 $88 $2 2% Loan Syndications and Sales 15 303 (288) -95% Scheduled Principal Amortization 7 12 (5) -42% Payment of Accrued Payment-in-kind Notes and Dividends and Accreted Loan Discounts 2 16 (14) -88% Sale of Equity Investments 49 57 (8) -14% --- --- --- --- Total $163 $476 $(313) -66% ==== ==== ===== === Appreciation, Depreciation, Gain and Loss Gross Realized Gain $8 $3 $5 167% Gross Realized Loss (115) (285) 170 60% ---- ---- --- --- Portfolio Net Realized Loss (107) (282) 175 62% Foreign Currency (3) (1) (2) -200% Derivative and Option Agreements (16) (19) 3 16% Net Realized Loss (126) (302) 176 58% ---- ---- --- --- Gross Unrealized Appreciation of Private Finance Portfolio Investments 195 163 32 20% Gross Unrealized Depreciation of Private Finance Portfolio Investments (84) (141) 57 40% --- ---- --- --- Net Unrealized Appreciation (Depreciation) of Private Finance Portfolio Investments 111 22 89 405% Net Unrealized Appreciation (Depreciation) of European Capital Limited Investment 50 102 (52) -51% Net Unrealized Appreciation of European Capital Limited Foreign Currency 69 22 47 214% Net Unrealized Depreciation of American Capital Agency Corp. (2) (5) 3 60% Net Unrealized Appreciation (Depreciation) of American Capital, LLC 26 10 16 160% Net Unrealized Depreciation of Structured Products - (25) 25 100% Reversal of Prior Period Net Unrealized Depreciation Upon Realization 103 284 (181) -64% --- --- ---- --- Net Unrealized Appreciation (Depreciation) of Portfolio Investments 357 410 (53) -13% Foreign Currency Translation (87) (26) (61) -235% Derivative Agreements and Other (6) 6 (12) NM Reversal of Prior Period Net Unrealized Depreciation on Option Agreements - - - 0% --- --- --- --- Net Unrealized Appreciation (Depreciation) of Investments 264 390 (126) -32% --- --- ---- --- Net Gains, Losses, Appreciation and Depreciation $138 $88 $50 57% ==== === === === Other Financial Data NAV per Share $8.98 $8.29 $0.69 8% Debt at Cost $4,026 $4,142 $(116) -3% Debt at Fair Value $3,955 $3,929 $26 1% Market Capitalization $1,429 $685 $744 109% Total Enterprise Value(3) $4,635 $3,992 $643 16% Credit Quality Weighted Average Effective Interest Rate on Private Finance Debt Investments at Period End 10.3% 9.9% 0.4% 4% Loans on Non- Accrual at Cost $671 $811 $(140) -17% Loans on Non- Accrual at Fair Value $263 $290 $(27) -9% Non-Accrual Loans at Cost as a Percentage of Total Loans 15.4% 18.1% Non-Accrual Loans at Fair Value as a Percentage of Total Loans 7.0% 7.8% Past Due Loans at Cost $47 $88 $(41) -47% Debt to Equity Conversions at Cost $77 $54 $23 43% Return on Equity LTM Net Operating Income Return on Average Equity at Cost 1.9% 2.1% LTM Realized (Loss) Earnings Return on Average Equity at Cost -11.3% -10.7% LTM Net Loss Return on Average Equity -7.6% -37.3% Current Quarter Net Operating Income Return on Average Equity at Cost Annualized 3.2% 1.2% Current Quarter Realized Loss Return on Average Equity at Cost Annualized -5.1% -18.4% Current Quarter Earnings Return (Loss) on Average Equity Annualized 30.7% 18.9% Q1 2010 Versus Q1 2009 ---------------------- Q1 2009 $ % ------- --- --- Assets Under Management American Capital Assets at Fair Value(1) $7,211 $(454) -6% Externally Managed Assets at Fair Value(2) 3,659 3,308 90% ----- ----- --- Total $10,870 $2,854 26% ======= ====== === Capital Resources Under Management American Capital Assets at Fair Value plus Available Capital Resources(1) $7,234 $(477) -7% Externally Managed Assets at Fair Value plus Available Capital Resources(2) 3,884 3,301 85% ----- ----- --- Total $11,118 $2,824 25% ======= ====== === New Investments Senior Debt $27 $(27) -100% Subordinated Debt 5 76 1520% Preferred Equity 8 (7) -88% Common Equity - 2 100% --- --- --- Total $40 $44 110% === === === Add-on Financing for Working Capital in Distressed Situations $25 $(17) -68% Add-on Financing for Acquisitions - - 0% Add-on Financing for Growth and Working Capital - 1 100% Add-on Financing for Recapitalizations 15 60 400% --- --- --- Total $40 $44 110% === === === Realizations Principal Prepayments $42 $48 114% Loan Syndications and Sales 8 7 88% Scheduled Principal Amortization 10 (3) -30% Payment of Accrued Payment- in-kind Notes and Dividends and Accreted Loan Discounts 4 (2) -50% Sale of Equity Investments 15 34 227% --- --- --- Total $79 $84 106% === === === Appreciation, Depreciation, Gain and Loss Gross Realized Gain $8 $- 0% Gross Realized Loss (87) (28) -32% --- --- --- Portfolio Net Realized Loss (79) (28) -35% Foreign Currency (2) (1) -50% Derivative and Option Agreements (50) 34 68% --- --- --- Net Realized Loss (131) 5 4% ---- --- --- Gross Unrealized Appreciation of Private Finance Portfolio Investments 33 162 491% Gross Unrealized Depreciation of Private Finance Portfolio Investments (453) 369 81% ---- --- --- Net Unrealized Appreciation (Depreciation) of Private Finance Portfolio Investments (420) 531 NM Net Unrealized Appreciation (Depreciation) of European Capital Limited Investment (13) 63 NM Net Unrealized Appreciation of European Capital Limited Foreign Currency 56 13 23% Net Unrealized Depreciation of American Capital Agency Corp. (18) 16 89% Net Unrealized Appreciation (Depreciation) of American Capital, LLC (162) 188 NM Net Unrealized Depreciation of Structured Products (46) 46 100% Reversal of Prior Period Net Unrealized Depreciation Upon Realization 78 25 32% --- --- --- Net Unrealized Appreciation (Depreciation) of Portfolio Investments (525) 882 NM Foreign Currency Translation (69) (18) -26% Derivative Agreements and Other 53 (59) NM Reversal of Prior Period Net Unrealized Depreciation on Option Agreements 49 (49) -100% Net Unrealized Appreciation (Depreciation) of Investments (492) 756 NM ---- --- --- Net Gains, Losses, Appreciation and Depreciation $(623) $761 NM ===== ==== === Other Financial Data NAV per Share $12.32 $(3.34) -27% Debt at Cost $4,377 $(351) -8% Debt at Fair Value $2,722 $1,233 45% Market Capitalization $403 $1,026 255% Total Enterprise Value(3) $4,692 $(57) -1% Credit Quality Weighted Average Effective Interest Rate on Private Finance Debt Investments at Period End 9.5% 0.8% 8% Loans on Non-Accrual at Cost $1,061 $(390) -37% Loans on Non-Accrual at Fair Value $214 $49 23% Non-Accrual Loans at Cost as a Percentage of Total Loans 17.1% Non-Accrual Loans at Fair Value as a Percentage of Total Loans 4.4% Past Due Loans at Cost $36 $11 31% Debt to Equity Conversions at Cost $35 $42 120% Return on Equity LTM Net Operating Income Return on Average Equity at Cost 6.1% LTM Realized (Loss) Earnings Return on Average Equity at Cost 4.3% LTM Net Loss Return on Average Equity -64.2% Current Quarter Net Operating Income Return on Average Equity at Cost Annualized 3.9% Current Quarter Realized Loss Return on Average Equity at Cost Annualized -3.4% Current Quarter Earnings Return (Loss) on Average Equity Annualized -75.4% NM = Not meaningful (1) Includes American Capital's investment in its externally managed funds. (2) Includes American Capital Agency Corp., American Capital Equity I, American Capital Equity II, ACAS CLO-1 and ACAS CRE CDO 2007-1. (3) Enterprise value is calculated as debt at cost plus market capitalization less cash and cash equivalents on hand. Static Pool (1) Portfolio Statistics --------------------------------------- ($ in millions, unaudited) Pre-2001 2001 2002 2003 2004 ------------------------- -------- ---- ---- ---- ---- IRR -Fair Value -All Investments(2) 7.9% 18.1% 7.9% 20.9% 13.2% IRR -Fair Value -Equity Investments Only(2)(3)(4) 5.8% 46.9% 11.4% 28.7% 27.6% IRR -Exited Investments(5) 8.6% 20.2% 9.1% 23.5% 17.0% Original Investments and Commitments $1,065 $376 $962 $1,434 $2,266 Total Exits and Prepayments of Original Investments and Commitments $998 $353 $757 $1,083 $1,830 Total Interest, Dividends and Fees Collected $386 $142 $307 $365 $540 Total Net Realized (Loss) Gain on Investments $(128) $(4) $(90) $142 $29 Current Cost of Investments $76 $23 $196 $331 $471 Current Fair Value of Investments $20 $2 $136 $418 $351 Current Fair Value of Investments as a % of Total Investments at Fair Value 0.4% 0.0% 2.4% 7.3% 6.2% Net Unrealized Appreciation (Depreciation) $(56) $(21) $(60) $87 $(120) Non-Accruing Loans at Cost $18 $14 $27 $- $39 Non-Accruing Loans at Fair Value $20 $2 $20 $- $11 Equity Interest at Fair Value(3) $- $- $1 $191 $73 Debt to EBITDA(6)(7)(8) 7.0 NM 8.1 4.5 6.2 Interest Coverage(6)(8) 1.9 NM 0.9 2.7 2.1 Debt Service Coverage(6)(8) 1.9 NM 0.8 2.5 1.5 Average Age of Companies(8) 37 yrs 25 yrs 50 yrs 40 yrs 45 yrs Diluted Ownership Percentage(3) 64% 86% 39% 52% 45% Average Sales(8)(9) $46 $7 $46 $187 $95 Average EBITDA(8)(10) $4 $- $9 $36 $23 Average EBITDA Margin 8.7% - 19.6% 19.3% 24.2% Total Sales(8)(9) $70 $267 $169 $1,269 $820 Total EBITDA(8)(10) $6 $4 $18 $179 $167 % of Senior Loans(8)(11) 86% 21% 57% 61% 41% % of Loans with Lien(8)(11) 100% 68% 100% 100% 91% Static Pool (1) Portfolio Statistics ----------------------------- ($ in millions, unaudited) 2005 2006 2007 2008 ------------------------- ---- ---- ---- ---- IRR - Fair Value - All Investments(2) 2.9% 7.2% -10.5% -2.5% IRR -Fair Value -Equity Investments Only(2)(3)(4) -8.2% 12.7% -16.5% -9.6% IRR - Exited Investments(5) 23.9% 9.7% -3.3% -74.9% Original Investments and Commitments $4,636 $5,179 $7,328 $1,021 Total Exits and Prepayments of Original Investments and Commitments $2,096 $3,277 $3,151 $55 Total Interest, Dividends and Fees Collected $696 $785 $815 $154 Total Net Realized (Loss) Gain on Investments $293 $(92) $(377) $(50) Current Cost of Investments $2,326 $1,570 $3,221 $799 Current Fair Value of Investments $1,224 $1,249 $1,691 $607 Current Fair Value of Investments as a % of Total Investments at Fair Value 21.5% 21.9% 29.7% 10.6% Net Unrealized Appreciation (Depreciation) $(1,102) $(321) $(1,530) $(192) Non-Accruing Loans at Cost $99 $136 $334 $4 Non-Accruing Loans at Fair Value $78 $58 $70 $4 Equity Interest at Fair Value(3) $554 $422 $394 $138 Debt to EBITDA(6)(7)(8) 4.6 5.3 6.9 6.3 Interest Coverage(6)(8) 2.4 2.5 2.2 1.4 Debt Service Coverage(6)(8) 1.6 2.0 1.9 1.2 Average Age of Companies(8) 29 yrs 31 yrs 28 yrs 25 yrs Diluted Ownership Percentage(3) 54% 44% 44% 35% Average Sales(8)(9) $122 $132 $234 $98 Average EBITDA(8)(10) $24 $36 $40 $28 Average EBITDA Margin 19.7% 27.3% 17.1% 28.6% Total Sales(8)(9) $1,954 $5,854 $8,107 $1,190 Total EBITDA(8)(10) $323 $896 $1,538 $234 % of Senior Loans(8)(11) 38% 37% 62% 26% % of Loans with Lien(8)(11) 89% 93% 93% 61% Static Pool (1) --------------------------------------------- Portfolio Statistics Pre-2001 - 2010 2005 - 2010 ($ in millions, unaudited) 2009 2010 Aggregate Aggregate ------------------------- ---- ---- --------- --------- IRR - Fair Value - All Investments(2) - - 4.5% -0.9% IRR - Fair Value - Equity Investments Only(2)(3)(4) - - 2.5% -5.0% IRR -Exited Investments(5) - - 13.0% 11.5% Original Investments and Commitments $- $- $24,267 $18,164 Total Exits and Prepayments of Original Investments and Commitments $- $- $13,600 $8,579 Total Interest, Dividends and Fees Collected $- $- $4,190 $2,450 Total Net Realized (Loss) Gain on Investments $- $- $(277) $(226) Current Cost of Investments $- $- $9,013 $7,916 Current Fair Value of Investments $- $- $5,698 $4,771 Current Fair Value of Investments as a % of Total Investments at Fair Value - - 100.0% 83.7% Net Unrealized Appreciation (Depreciation) $- $- $(3,315) $(3,145) Non-Accruing Loans at Cost $- $- $671 $573 Non-Accruing Loans at Fair Value $- $- $263 $210 Equity Interest at Fair Value(3) $- $- $1,773 $1,508 Debt to EBITDA(6)(7)(8) - - 5.9 5.9 Interest Coverage(6)(8) - - 2.2 2.2 Debt Service Coverage(6)(8) - - 1.8 1.8 Average Age of Companies(8) - - 31 yrs 29 yrs Diluted Ownership Percentage(3) - - 46% 46% Average Sales(8)(9) $- $- $159 $166 Average EBITDA(8)(10) $- $- $33 $34 Average EBITDA Margin - - 20.8% 20.5% Total Sales(8)(9) $- $- $19,700 $17,105 Total EBITDA(8)(10) $- $- $3,365 $2,991 % of Senior Loans(8)(11) - - 47% 46% % of Loans with Lien(8)(11) - - 89% 87% (1) Static pool classification is based on the year the initial investment was made. Subsequent add-on investments are included in the static pool year of the original investment. (2) Assumes investments are exited at current fair value. (3) Excludes investments in structured products. (4) Excludes equity investments that are the result of conversions of debt and warrants received with the issuance of debt. (5) Includes exited securities of existing portfolio companies. (6) These amounts do not include investments in which we own only equity. (7) For portfolio companies with a nominal EBITDA amount, the portfolio company’s maximum debt leverage is limited to 15 times EBITDA. (8) Excludes investments in structured products, managed funds and American Capital, LLC. (9) Sales of the most recent twelve months, or when appropriate, the forecasted twelve months. (10) EBITDA of the most recent twelve months, or when appropriate, the forecasted twelve months. (11) As a percentage of our total debt investments.
SHAREHOLDER CALL
American Capital invites shareholders, analysts and interested parties to attend the shareholder call on May 5, 2010 at 11:00 am ET. The shareholder call can be accessed through a live webcast, free of charge, at www.AmericanCapital.com or by dialing (877) 569-8701 (U.S. domestic) or +1 (574) 941-7382 (international). Please provide the operator with the conference ID number 68310346. If you do not plan on asking a question on the call and have access to the internet, please take advantage of the webcast.
A slide presentation will accompany the shareholder call and will be available at www.AmericanCapital.com in advance of the shareholder call. Select the Q1 2010 Earnings Presentation link to download and print the presentation in advance of the shareholder call.
An archived audio replay of the shareholder call combined with the slide presentation will be made available on our website after the call. In addition, there will be a phone recording available from 4:00 pm ET May 5, 2010 until 11:59 pm ET May 19, 2010. If you are interested in hearing the recording of the presentation, please dial (800) 642-1687 (U.S. domestic) or +1 (706) 645-9291 (international). The access code for both domestic and international callers is 68310346.
ABOUT AMERICAN CAPITAL
American Capital is a publicly traded private equity firm and global asset manager. American Capital, both directly and through its asset management business, originates, underwrites and manages investments in middle market private equity, leveraged finance, real estate and structured products. Founded in 1986, American Capital currently has $13.9 billion in capital resources under management and eight offices in the U.S., Europe and Asia. For further information, please refer to www.AmericanCapital.com.
ADDITIONAL INFORMATION
Persons considering an investment in American Capital should consider the investment objectives, risks and charges and expenses of the Company carefully before investing. Such information and other information about the Company is available in the Company’s annual report on Form 10-K, quarterly reports on Form 10-Q and in the prospectuses the Company issues from time to time in connection with its offering of securities. Such materials are filed with the Securities and Exchange Commission (“SEC”) and copies are available on the SEC’s website, www.sec.gov. Prospective investors should read such materials carefully before investing. Performance data quoted above represents past performance of American Capital. Past performance does not guarantee future results and the investment return and principal value of an investment in American Capital will likely fluctuate. Consequently, an investor’s shares, when sold, may be worth more or less than their original cost. Additionally, American Capital’s current performance may be lower or higher than the performance data quoted above.
This press release contains forward-looking statements. Forward-looking statements are based on estimates, projections, beliefs and assumptions of management of the Company at the time of such statements and are not guarantees of future performance. Forward-looking statements involve risks and uncertainties in predicting future results and conditions. Actual results could differ materially from those projected in these forward-looking statements due to a variety of factors, including, without limitation, the uncertainties associated with the timing of transaction closings, changes in interest rates, availability of transactions, changes in regional, national or international economic conditions or changes in the conditions of the industries in which American Capital has made investments. Certain factors that could cause actual results to differ materially from those contained in the forward-looking statements are included in the “Risk Factors” section of the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2009 and the Company’s subsequent periodic filings. Copies are available on the SEC’s website at www.sec.gov. Forward-looking statements are made as of the date of this press release, and are subject to change without notice. We disclaim any obligation to update or revise any forward-looking statements based on the occurrence of future events, the receipt of new information, or otherwise.
CONTACT: |
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Investors - (301) 951-5917 |
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Media - (301) 968-9400 |
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SOURCE American Capital Ltd.
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