Blue Owl Capital Corporation III Reports First Quarter Net Investment Income Per Share of $0.39 and NAV Per Share of $15.65

NEW YORK, May 8, 2024 /PRNewswire/ -- Blue Owl Capital Corporation III (NYSE: OBDE, or the "Company") today announced financial results for its first quarter ended March 31, 2024.

FIRST QUARTER 2024 HIGHLIGHTS

• First quarter net investment income ("NII") per share of $0.39, which exceeds the first quarter regular dividend of $0.35 per share by $0.04 per share
• Successfully listed on the New York Stock Exchange in January as one of the largest BDCs in the public market
• In conjunction with the listing, the Board of Directors (the "Board") declared five special dividends of $0.06 per share to be paid quarterly beginning in the second quarter of 2024
• 10.5% annualized dividend yield based on first quarter net asset value ("NAV") per share¹
• NAV per share increased to $15.65 compared to $15.56 as of December 31, 2023, representing the Company's highest NAV per share since inception

"OBDE delivered strong performance in the first quarter, achieving record net asset value per share for the fifth consecutive quarter," commented Craig W. Packer, Chief Executive Officer. "We have made meaningful progress towards reaching our target leverage range and believe we are well positioned to deliver sustained, attractive risk-adjusted returns to our shareholders as a public company." 

Dividend Declarations
The Company's Board declared a second quarter 2024 dividend of $0.35 per share for stockholders of record as of June 28, 2024, payable on or before July 15, 2024.

In addition, and as previously announced, the Board declared a series of five special dividends of $0.06 per share, payable to stockholders of record quarterly beginning in the second quarter 2024. A full schedule of the record and payment dates can be found on the Company's website.

PORTFOLIO AND INVESTING ACTIVITY

For the three months ended March 31, 2024, new investment commitments totaled $736.4 million across 43 new portfolio companies and 14 existing portfolio companies. This compares to $435.9 million for the three months ended December 31, 2023 across 17 new portfolio companies and 13 existing portfolio companies.

For the three months ended March 31, 2024, the principal amount of new investments funded was $630.9 million. For this period, the Company had $232.9 million aggregate principal amount in sales and repayments.

For the three months ended December 31, 2023, the principal amount of new investments funded was $350.8 million. For this period, the Company had $328.4 million aggregate principal amount in sales and repayments.

As of March 31, 2024 and December 31, 2023, the Company had investments in 188 and 153 portfolio companies with an aggregate fair value of $4.0 billion and $3.6 billion, respectively. As of March 31, 2024, the average investment size in each portfolio company was $21.2 million based on fair value.

As of March 31, 2024, based on fair value, our portfolio consisted of 82.3% first lien senior secured debt investments, 6.6% second lien senior secured debt investments, 1.5% unsecured debt investments, 4.9% preferred equity investments, and 4.7% common equity investments.

As of December 31, 2023, based on fair value, our portfolio consisted of 76.4% first lien senior secured debt investments, 12.1% second lien senior secured debt investments, 1.7% unsecured debt investments, 5.2% preferred equity investments, and 4.6% common equity investments.

As of March 31, 2024 and December 31, 2023, approximately 88.9% and 88.5% of the portfolio was invested in secured debt, respectively. As of March 31, 2024, 98.2% of our debt investments based on fair value in our portfolio were at floating rates.

As of March 31, 2024 and December 31, 2023, the weighted average total yield of accruing debt and income-producing securities at fair value (which includes interest income and amortization of fees and discounts) was 11.7% and 12.1%, respectively, and the weighted average total yield of accruing debt and income-producing securities at amortized cost (which includes interest income and amortization of fees and discounts) was 11.7% and 12.1%, respectively.

As of March 31, 2024, loans on non-accrual represented 0.3% of the total fair value of the debt portfolio.

RESULTS OF OPERATIONS FOR THE FIRST QUARTER ENDED MARCH 31, 2024

Investment Income
Investment income increased to $113.4 million for the three months ended March 31, 2024 from $97.9 million for the same period in prior year primarily due to an increase in interest income as a result of an increase in our debt investment portfolio at par as well as an increase in the base rates charged on our floating rate debt investments. Dividend income increased period over period due an increase in our portfolio of dividend income-producing equity investments at cost. Included in interest income are other fees such as prepayment fees and accelerated amortization of upfront fees from unscheduled paydowns which are non-recurring in nature. Other income increased period over period due to an increase in incremental fee income, which are fees that are generally available to us as a result of closing investments and generally paid at the time of closing or as a result of episodic amendments made to the terms of our existing debt investments. We expect that investment income will vary based on a variety of factors including the pace of our originations and repayments.

Expenses
Total expenses increased to $64.7 million for the three months ended March 31, 2024 from $35.1 million for the same period in prior year due to an increase in management fees, incentive fees, interest expense and other expenses including the payment of listing advisory fees. The increase in interest expense was driven by an increase in average daily borrowings period over period, as well as an increase in the average interest rate period over period. Management fees increased due to an increase in our investment portfolio at fair value as well as the increased fee rates effective as of our listing date. The increase in other expenses was primarily driven by expenses associated with the exchange listing, which are not anticipated to be recurring in nature. As a percentage of total assets, professional fees, directors' fees and other general and administrative expenses increased period over period.

Liquidity and Capital Resources
As of March 31, 2024, we had $140.2 million in cash, $2.2 billion in total principal value of debt outstanding, and $345.8 million of undrawn capacity on our credit facilities. The Company's weighted average interest rate on debt outstanding was 7.0% and 6.9% for the three months ended March 31, 2024 and December 31, 2023, respectively. Ending net debt to equity was 1.04x and 0.86x as of March 31, 2024 and December 31, 2023, respectively.

CONFERENCE CALL AND WEBCAST INFORMATION

Conference Call Information:
The conference call will be broadcast live on May 9, 2024 at 11:00 a.m. Eastern Time on the Events section of OBDE's website at www.BlueOwlCapitalCorporationIII.com. Please visit the website to test your connection before the webcast.

Participants are also invited to access the conference call by dialing one of the following numbers:

• Domestic: (877) 407-9714
• International: +1 (201) 689-8865

All callers will need to reference "Blue Owl Capital Corporation III" once 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.

Replay Information:
An archived replay will be available for 14 days via a webcast link located on the Events section of OBDE's website, and via the dial-in numbers listed below:

• Domestic: (877) 660-6853
• International: +1 (201) 612-7415
• Conference ID: 13745828

ABOUT BLUE OWL CAPITAL CORPORATION III

Blue Owl Capital Corporation III (NYSE: OBDE) is a specialty finance company focused on lending to U.S. middle-market companies. As of March 31, 2024, OBDE had investments in 188 portfolio companies with an aggregate fair value of $4.0 billion. OBDE has elected to be regulated as a business development company under the Investment Company Act of 1940, as amended. OBDE is externally managed by Blue Owl Diversified Credit Advisors, an SEC-registered investment adviser that is an indirect affiliate of Blue Owl Capital Inc. ("Blue Owl") (NYSE: OWL) and is a part of Blue Owl's Credit platform.

Certain information contained herein may constitute "forward-looking statements" that involve substantial risks and uncertainties. Such statements involve known and unknown risks, uncertainties and other factors and undue reliance should not be placed thereon. These forward-looking statements are not historical facts, but rather are based on current expectations, estimates and projections about OBDE, its current and prospective portfolio investments, its industry, its beliefs and opinions, and its assumptions. Words such as "anticipates," "expects," "intends," "plans," "will," "may," "continue," "believes," "seeks," "estimates," "would," "could," "should," "targets," "projects," "outlook," "potential," "predicts" and variations of these words and similar expressions are intended to identify forward-looking statements. These statements are not guarantees of future performance and are subject to risks, uncertainties and other factors, some of which are beyond OBDE's control and difficult to predict and could cause actual results to differ materially from those expressed or forecasted in the forward-looking statements including, without limitation, the risks, uncertainties and other factors identified in OBDE's filings with the SEC. Investors should not place undue reliance on these forward-looking statements, which apply only as of the date on which OBDE makes them. OBDE does not undertake any obligation to update or revise any forward-looking statements or any other information contained herein, except as required by applicable law.

INVESTOR CONTACTS

Investor Contact:
BDC Investor Relations
[email protected]

Media Contact:
Prosek Partners
Josh Clarkson
[email protected]

SOURCE Blue Owl Capital Corporation III