Owl Rock Capital Corp. Reports Third Quarter Net Investment Income Per Share of $0.36 and NAV Per Share of $15.22
NEW YORK--(BUSINESS WIRE)-- Owl Rock Capital Corporation (NYSE: ORCC, or the “Company”) today reported net investment income of $137.9 million, or $0.36 per share, and net income of $118.7 million, or $0.31 per share, for the third quarter ended September 30, 2019. Reported net asset value per share was $15.22 at September 30, 2019 as compared to $15.28 at June 30, 2019.
The Company’s Board of Directors has declared a fourth quarter 2019 dividend of $0.31 per share and had previously declared a special dividend of $0.04 per share, both for stockholders of record as of December 31, 2019, payable on or before January 31, 2020.
The Board of Directors also previously declared the following special dividends, for shareholders of record as of the last day of each respective quarter:
- Q1 2020: $0.08 per share
- Q2 2020: $0.08 per share
- Q3 2020: $0.08 per share
- Q4 2020: $0.08 per share
The Company agent will repurchase shares of common stock on the Company’s behalf when the market price per share is below the most recently reported net asset value per share. This corresponds to a market price of $15.21 based on September 30, 2019 NAV per share of $15.22. The Company 10b5-1 Plan commenced August 19, 2019 and will terminate upon the earliest to occur of (i) February 19, 2021 or (ii) such time as the approved $150 million repurchase amount has been fully utilized, subject to certain conditions.
Portfolio and Investing Activity
For the three months ended September 30, 2019, new investment commitments totaled $1,542.7 million. This compares to $953.4 million for the three months ended June 30, 2019.
For the three months ended September 30, 2019, the principal amount of new investments funded was $1,074.8 million across 10 new portfolio companies and 9 existing portfolio companies. For this period, the Company had $215.3 million aggregate principal amount in exits and repayments.
For the quarter ended June 30, 2019, the principal amount of new investments funded was $772.9 million across 13 new portfolio companies and 13 existing portfolio companies. For this period, the Company had $465.2 million aggregate principal amount in exits and repayments.
As of September 30, 2019 and June 30, 2019, the Company had investments in 96 and 90 portfolio companies with an aggregate fair value of $8.3 billion and $7.2 billion, respectively. As of September 30, 2019, the average investment size in each portfolio company was $86.1 million based on fair value.
As of September 30, 2019, based on fair value, our portfolio consisted of 79.4% first lien senior secured debt investments, 19.3% second lien senior secured debt investments, 1.1% investment funds and vehicles, and 0.2% equity investments.
As of June 30, 2019, based on fair value, our portfolio consisted of 81.3% first lien senior secured debt investments, 16.9% second lien senior secured debt investments, 0.3% unsecured debt investments, 1.3% investment funds and vehicles, and 0.2% equity investments.
As of September 30, 2019 and June 30, 2019, approximately 98.7% and 98.2% of the portfolio was invested in secured debt, respectively. As of September 30, 2019, 100.0% of our debt investments based on fair value in our portfolio were at floating rates.
As of September 30, 2019 and June 30, 2019, the weighted average total yield of debt and income-producing securities at fair value (which includes interest income and amortization of fees and discounts) was 9.0% and 9.1%, respectively, and the weighted average total yield of debt and income-producing securities at amortized cost (which includes interest income and amortization of fees and discounts) was 8.9% and 9.1%, respectively.
As of September 30, 2019, no investments were on non-accrual status.
Results of Operations for the Three Months Ended September 30, 2019
Investment Income
Investment income increased to $188.1 million for the three months ended September 30, 2019 from $176.1 million for the three months ended June 30, 2019. The increase was primarily due to an increase in interest income as a result of an increase in our investment portfolio.
Expenses
Total net expenses decreased to $49.9 million for the three months ended September 30, 2019 from $56.7 million for the three months ended June 30, 2019, primarily due to lower interest expense as a result of decreased leverage in the quarter following the final capital call in June.
Liquidity and Capital Resources
As of September 30, 2019, we had $198 million in cash and restricted cash, $2.5 billion in total principal value of debt outstanding, and $1.6 billion of undrawn capacity on our credit facilities. The Company’s weighted average interest rate on debt outstanding was 5.1% and 5.0% for the three months ended September 30, 2019 and June 30, 2019, respectively. Average debt to equity was 0.35x and 0.65x during the three months ended September 30, 2019 and June 30, 2019, respectively.
Conference Call and Webcast Information
Conference Call Information:
The conference call will be broadcast live on October 31, 2019 at 9:00 a.m. Eastern Time on the Investor Resources section of ORCC’s website at www.OwlRockCapitalCorporation.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: (866) 393-4306
International: (734) 385-2616
Conference ID: 6251428
All callers will need to enter the Conference ID followed by the # sign and reference “Owl Rock Capital Corporation” 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 Investor Resources section of ORCC’s website, and via the dial-in numbers listed below:
Domestic: (855) 859-2056
International: (404) 537-3406
Conference ID: 6251428
About Owl Rock Capital Corporation
Owl Rock Capital Corporation (ORCC) is a specialty finance company focused on lending to U.S. middle-market companies. As of September 30, 2019 ORCC had investments in 96 portfolio companies with an aggregate fair value of $8.3 billion. ORCC has elected to be regulated as a business development company under the Investment Company Act of 1940, as amended. ORCC is externally managed by Owl Rock Capital Advisors LLC, an SEC-registered investment adviser that is an affiliate of Owl Rock Capital Partners. Owl Rock Capital Partners, together with its subsidiaries, is a New York based direct lending platform with approximately $14.6 billion of assets under management as of September 30, 2019.
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 ORCC, 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 ORCC’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 ORCC’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 ORCC makes them. ORCC 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.
| Owl Rock Capital Corporation | ||||||
| Consolidated Financial Highlights | ||||||
| (Amounts in thousands, except per share amounts) | ||||||
| (Unaudited) | ||||||
| For the three months ended | ||||||
| September 30, 2019 | June 30, 2019 | September 30, 2018 | ||||
| Investments at Fair Value |
$ 8,270,254 |
$ 7,240,755 |
$ 4,692,912 |
|||
| Total Assets |
$ 8,568,677 |
$ 7,547,803 |
$ 4,875,898 |
|||
| Net Asset Value Per Share |
$ 15.22 |
$ 15.28 |
$ 15.27 |
|||
| Investment Income |
$ 188,154 |
$ 176,135 |
$ 110,485 |
|||
| Net Investment Income |
$ 137,906 |
$ 119,622 |
$ 71,608 |
|||
| Net Income |
$ 118,652 |
$ 124,670 |
$ 72,326 |
|||
| Net Investment Income Per Share |
$ 0.36 |
$ 0.42 |
$ 0.44 |
|||
| Net Realized and Unrealized Gains (and Losses) Per Share |
$ (0.05) |
$ 0.02 |
$ 0.00 |
|||
| Net Income Per Share |
$ 0.31 |
$ 0.44 |
$ 0.44 |
|||
| Distributions Declared from Net Investment Income |
$ 0.33 |
$ 0.44 |
$ 0.39 |
|||
| Weighted Average Yield of Debt and Income Producing Securities at Fair Value |
9.0% |
9.1% |
9.4% |
|||
| Weighted Average Yield of Debt and Income Producing Securities at Amortized Cost |
8.9% |
9.1% |
9.4% |
|||
| Percentage of Debt Investment Commitments at Floating Rates |
100.0% |
99.7% |
100.0% |
|||
| Owl Rock Capital Corporation | ||||
| Consolidated Statements of Assets and Liabilities | ||||
| (Amounts in thousands, except share and per share amounts) | ||||
| September 30, 2019 (Unaudited) |
December 31, 2018 |
|||
| Assets | ||||
| Investments at fair value | ||||
| Non-controlled, non-affiliated investments (amortized cost of $8,204,082 and $5,720,295, respectively) |
$ 8,178,157 |
$ 5,697,447 |
||
| Controlled, affiliated investments (amortized cost of $93,267 and $91,138, respectively) |
92,097 |
86,622 |
||
| Total investments at fair value (amortized cost of $8,297,349 and $5,811,433, respectively) |
8,270,254 |
5,784,069 |
||
| Cash (restricted cash of $12,969 and $6,013, respectively) |
197,618 |
127,603 |
||
| Interest receivable |
55,534 |
29,680 |
||
| Receivable for investments sold |
23,261 |
— | ||
| Receivable from a controlled affiliate |
2,290 |
8,100 |
||
| Prepaid expenses and other assets |
19,710 |
1,590 |
||
| Total Assets |
$ 8,568,667 |
$ 5,951,042 |
||
| Liabilities | ||||
| Debt (net of unamortized debt issuance costs of $38,176 and $22,335, respectively) |
$ 2,459,023 |
$ 2,567,717 |
||
| Distribution payable |
128,421 |
78,350 |
||
| Management fee payable |
14,760 |
14,049 |
||
| Payables to affiliates |
4,657 |
2,847 |
||
| Payable for investments purchased |
1,627 |
3,180 |
||
| Accrued expenses and other liabilities |
35,554 |
20,054 |
||
| Total Liabilities |
2,644,042 |
2,686,197 |
||
| Commitments and contingencies | ||||
| Net Assets | ||||
| Common shares $0.01 par value, 500,000,000 shares authorized; 389,155,516 and 216,204,837 shares issued and outstanding, respectively |
3,892 |
2,162 |
||
| Additional paid-in-capital |
5,907,924 |
3,271,162 |
||
| Total distributable earnings (losses) |
12,809 |
(8,479) |
||
| Total Net Assets |
5,924,625 |
3,264,845 |
||
| Total Liabilities and Net Assets |
$ 8,568,667 |
$ 5,951,042 |
||
| Net Asset Value Per Share |
$ 15.22 |
$ 15.10 |
||
| Owl Rock Capital Corporation | ||||||||
| Consolidated Statement of Operations | ||||||||
| (Amounts in thousands, except share and per share amounts) | ||||||||
| (Unaudited) | ||||||||
| For the Three Months Ended September 30, |
For the Nine Months Ended September 30, |
|||||||
|
|
|
2019 |
|
2018 |
|
2019 |
|
2018 |
| Investment Income | ||||||||
| Investment income from non-controlled, non-affiliated investments: | ||||||||
| Interest income |
$ 180,944 |
$ 104,868 |
$ 498,747 |
$ 246,064 |
||||
| Other income |
4,921 |
2,164 |
9,447 |
6,770 |
||||
| Total investment income from non-controlled, non-affiliated investments |
185,865 |
107,032 |
508,194 |
252,834 |
||||
| Investment income from controlled, affiliated investments: | ||||||||
| Dividend income |
2,289 |
2,226 |
7,570 |
5,149 |
||||
| Other income | — |
1,227 |
— |
4,046 |
||||
| Total investment income from controlled, affiliated investments |
2,289 |
3,453 |
7,570 |
9,195 |
||||
| Total Investment Income |
188,154 |
110,485 |
515,764 |
262,029 |
||||
| Expenses | ||||||||
| Interest expense |
29,434 |
21,386 |
101,021 |
50,545 |
||||
| Management fee |
26,793 |
13,323 |
57,434 |
38,100 |
||||
| Performance based incentive fees |
19,674 |
— |
19,674 |
— | ||||
| Professional fees |
2,886 |
2,524 |
7,361 |
5,567 |
||||
| Directors' fees |
169 |
138 |
445 |
404 |
||||
| Other general and administrative |
2,697 |
1,274 |
6,248 |
3,973 |
||||
| Total Operating Expenses |
81,653 |
38,645 |
192,183 |
98,589 |
||||
| Management and incentive fees waived |
(31,707) |
— |
(31,707) |
— | ||||
| Net Operating Expenses |
49,946 |
38,645 |
160,476 |
98,589 |
||||
| Net Investment Income (Loss) Before Taxes |
138,208 |
71,840 |
355,288 |
163,440 |
||||
| Excise tax expense (benefit) |
302 |
232 |
1,754 |
815 |
||||
| Net Investment Income (Loss) After Taxes |
$ 137,906 |
$ 71,608 |
$ 353,534 |
$ 162,625 |
||||
| Net Realized and Unrealized Gain (Loss) | ||||||||
| Net change in unrealized gain (loss): | ||||||||
| Non-controlled, non-affiliated investments |
$ (20,846) |
$ (3,476) |
$ (376) |
$ 5,470 |
||||
| Controlled affiliated investments |
284 |
168 |
3,346 |
(1,013) |
||||
| Translation of assets and liabilities in foreign currencies |
(146) |
(134) |
(168) |
(134) |
||||
| Total Net Change in Unrealized Gain (Loss) |
(20,708) |
(3,442) |
2,802 |
4,323 |
||||
| Net realized gain (loss): | ||||||||
| Non-controlled, non-affiliated investments |
1,285 |
4,027 |
1,102 |
234 |
||||
| Foreign currency transactions |
169 |
133 |
372 |
133 |
||||
| Total Net Realized Gain (Loss) |
1,454 |
4,160 |
1,474 |
367 |
||||
| Total Net Realized and Unrealized Gain (Loss) |
(19,254) |
718 |
4,276 |
4,690 |
||||
| Net Increase (Decrease) in Net Assets Resulting from Operations |
$ 118,652 |
$ 72,326 |
$ 357,810 |
$ 167,315 |
||||
| Earnings Per Share - Basic and Diluted |
$ 0.31 |
$ 0.44 |
$ 1.18 |
$ 1.29 |
||||
| Weighted Average Shares Outstanding - Basic and Diluted |
384,846,445 |
163,401,485 |
302,373,486 |
129,234,396 |
||||
| Owl Rock Capital Corporation | ||||
| Portfolio and Investment Activity | ||||
| (Amounts in thousands) | ||||
| (Unaudited) | ||||
| For the Three Months Ended September 30, | ||||
|
|
|
2019 |
|
2018 |
| New investment commitments | ||||
| Gross originations |
$ 1,631,537 |
$ 2,019,388 |
||
| Less: Sell downs |
(88,809) |
(303,690) |
||
| Total new investment commitments |
$ 1,542,728 |
$ 1,715,698 |
||
| Principal amount of investments funded: | ||||
| First-lien senior secured debt investments |
$ 845,282 |
$ 1,160,059 |
||
| Second-lien senior secured debt investments |
443,270 |
311,137 |
||
| Unsecured debt investments | — | — | ||
| Equity investments | — | — | ||
| Investment funds and vehicles |
1,500 |
9,629 |
||
| Total principal amount of investments funded |
$ 1,290,052 |
$ 1,480,825 |
||
| Principal amount of investments sold or repaid: | ||||
| First-lien senior secured debt investments |
$ (140,281) |
$ (97,259) |
||
| Second-lien senior secured debt investments |
(52,000) |
(145,350) |
||
| Unsecured debt investments |
(23,000) |
— | ||
| Equity investments | — |
(2,760) |
||
| Investment funds and vehicles | — | — | ||
| Total principal amount of investments sold or repaid |
$ (215,281) |
$ (245,369) |
||
| Number of new investment commitments in new portfolio companies(1) |
10 |
17 |
||
| Average new investment commitment amount |
$ 129,504 |
$ 93,492 |
||
| Weighted average term for new investment commitments (in years) |
6.7 |
6.1 |
||
| Percentage of new debt investment commitments at floating rates |
100.0% |
100.0% |
||
| Percentage of new debt investment commitments at fixed rates |
0.0% |
0.0% |
||
| Weighted average interest rate of new investment commitments(2) |
8.7% |
8.1% |
||
| Weighted average spread over LIBOR of new floating rate investment commitments |
6.6% |
5.7% |
||
| _____________ | ||||
| (1) Number of new investment commitments represents commitments to a particular portfolio company. (2) Assumes each floating rate commitment is subject to the greater of the interest rate floor (if applicable) or 3-month LIBOR, which was 2.09% and 2.40% as of September 30, 2019 and 2018, respectively. |
View source version on businesswire.com: https://www.businesswire.com/news/home/20191031005436/en/
Investors:
Investor Relations / Dana Sclafani
(212) 651-4705
ORCCIR@owlrock.com
Media:
Sard Verbinnen & Co
Margaret Popper / Brandon Messina / Hayley Cook
(212) 687-8080
Source: Owl Rock Capital Corporation
Released October 31, 2019