Monroe Capital Corporation (Nasdaq: MRCC) (“Monroe”) today
announced its financial results for the fourth quarter and full
year ended December 31, 2022. The Board of Directors of Monroe also
declared its first quarter distribution of $0.25 per share, payable
on March 31, 2023 to stockholders of record on March 15, 2023.
Except where the context suggests otherwise, the terms “Monroe,”
“we,” “us,” “our,” and “Company” refer to Monroe Capital
Corporation.
Fourth Quarter 2022 Financial Highlights
- Net Investment
Income of $5.5 million, or $0.25 per share
- Adjusted Net
Investment Income (a non-GAAP measure described below) of $5.6
million, or $0.26 per share
- Net increase in net assets resulting from operations of $4.5
million, or $0.21 per share
- Net Asset Value
(“NAV”) of $225.0 million, or $10.39 per share
- Paid quarterly
dividend of $0.25 per share on December 30, 2022
- Current annual cash
dividend yield to shareholders of approximately 11.9%(1)
_______________________________
(1) Based on an annualized dividend and closing share price as
of February 28, 2023.
Full Year 2022 Financial Highlights
- Net investment
income of $22.2 million, or $1.02 per share
- Adjusted Net
Investment Income (a non-GAAP measure described below) of $23.6
million, or $1.09 per share
- Net decrease in net
assets resulting from operations of $2.8 million, or ($0.13) per
share
Chief Executive Officer Theodore L. Koenig commented, “We are
pleased to report a strong quarter with Adjusted Net Investment
Income of $0.26 per share, highlighted by solid portfolio
performance and attractive new investment activity. Our priority
remains focused on maintaining portfolio credit quality, which
continues to demonstrate stability in the face of higher interest
rates, inflationary pressures and an uncertain macroeconomic
environment. We strongly believe that we remain well positioned to
redeploy capital to leading growth oriented middle market companies
in this more volatile and less competitive financing market, where
we stand to benefit from higher base rates and favorable deal
terms. As always, we continue to be focused on maximizing Adjusted
Net Investment Income and generating strong risk-adjusted returns
for our shareholders.”
Monroe Capital Corporation is a business development company
affiliate of the award winning private credit investment firm and
lender, Monroe Capital LLC.
Management Commentary
Adjusted Net Investment Income totaled $5.6 million or $0.26 per
share for the quarter ended December 31, 2022. This compares with
$7.1 million or $0.33 per share for the quarter ended September 30,
2022. While the average portfolio yield increased during the
quarter ended December 31, 2022, Adjusted Net Investment Income
declined primarily as a result of the quarter ended September 30,
2022 including a one-time benefit of the receipt of previously
unaccrued interest income associated with the repayment of an
investment that had previously been on non-accrual status. See
Non-GAAP Financial Measure – Adjusted Net Investment Income
discussion below.
NAV decreased by $0.04 per share, or 0.4%, to $225.0 million or
$10.39 per share as of December 31, 2022, compared to $226.0
million or $10.43 per share as of September 30, 2022. The NAV
decrease of $0.04 per share was primarily the result of net
unrealized losses on the Company’s investment in MRCC Senior Loan
Fund I, LLC (“SLF”). The decrease in value at the SLF was driven by
net losses on the SLF’s investments, which are loans to traditional
upper middle-market borrowers and has continued to experience
higher volatility in valuations. On a net basis, the valuations on
the remainder of the portfolio remained relatively flat to
September 30, 2022.
During the quarter, MRCC’s debt-to-equity leverage increased
from 1.33 times debt-to-equity to 1.49 times debt-to equity. The
increase in leverage was primarily driven by strong investment
activity during the fourth quarter. We continue to focus on
managing our investment portfolio and selectively redeploying
capital resulting from repayments.
Selected Financial Highlights (in
thousands, except per share data)
|
December 31, 2022 |
|
September 30, 2022 |
Consolidated Statements of Assets and Liabilities
data: |
|
|
(unaudited) |
Investments, at fair value |
$ |
541,040 |
|
|
$ |
508,018 |
|
Total
assets |
$ |
564,995 |
|
|
$ |
532,556 |
|
Total net
assets |
$ |
225,019 |
|
|
$ |
225,956 |
|
Net asset
value per share |
$ |
10.39 |
|
|
$ |
10.43 |
|
|
|
|
|
|
For the quarter ended |
|
December 31, 2022 |
|
September 30, 2022 |
Consolidated Statements of Operations data: |
(unaudited) |
Net
investment income |
$ |
5,520 |
|
|
$ |
6,260 |
|
Adjusted net
investment income(2) |
$ |
5,636 |
|
|
$ |
7,128 |
|
Net gain
(loss) |
$ |
(1,040 |
) |
|
$ |
(7,009 |
) |
Net increase
(decrease) in net assets resulting from operations |
$ |
4,480 |
|
|
$ |
(749 |
) |
|
|
|
|
Per share
data: |
|
|
|
Net
investment income |
$ |
0.25 |
|
|
$ |
0.29 |
|
Adjusted net
investment income(2) |
$ |
0.26 |
|
|
$ |
0.33 |
|
Net gain
(loss) |
$ |
(0.05 |
) |
|
$ |
(0.32 |
) |
Net increase
(decrease) in net assets resulting from operations |
$ |
0.21 |
|
|
$ |
(0.03 |
) |
______
(2) See Non-GAAP Financial Measure – Adjusted Net
Investment Income below for a detailed description of this non-GAAP
measure and a reconciliation from net investment income to Adjusted
Net Investment Income. The Company uses this non-GAAP financial
measure internally in analyzing financial results and believes that
this non-GAAP financial measure is useful to investors as an
additional tool to evaluate ongoing results and trends for the
Company.
Portfolio Review
The Company had debt and equity investments in 105 portfolio
companies, with a total fair value of $541.0 million as of December
31, 2022, as compared to debt and equity investments in 98
portfolio companies, with a total fair value of $508.0 million, as
of September 30, 2022. The Company’s portfolio consists primarily
of first lien loans, representing 84.0% of the portfolio as of
December 31, 2022, and 83.3% of the portfolio as of September 30,
2022. As of December 31, 2022, the weighted average contractual and
effective yield on the Company’s debt and preferred equity
investments was 11.0% and 11.0%, respectively, as compared to the
weighted average contractual and effective yield of 9.9% and 9.9%,
respectively, as of September 30, 2022. Portfolio yield is
calculated only on the portion of the portfolio that has a
contractual coupon and therefore does not account for dividends on
equity investments (other than preferred equity). As of December
31, 2022, 0.5% of the Company’s total investments at fair value
were on non-accrual as compared to 0.7% as of September 30,
2022.
Financial Review
Results of Operations: Fourth Quarter 2022
Net Investment Income for the quarter ended December 31, 2022
totaled $5.5 million, or $0.25 per share, compared to $6.3 million,
or $0.29 per share, for the quarter ended September 30, 2022.
Adjusted Net Investment Income was $5.6 million, or $0.26 per
share, for the quarter ended December 31, 2022, compared to $7.1
million, or $0.33 per share, for the quarter ended September 30,
2022. Investment income for the quarter ended December 31, 2022
totaled $15.2 million, compared to $15.9 million for the quarter
ended September 30, 2022. Excluding a one-time benefit of $2.0
million of previously unrecorded interest income associated with
the repayment of the Company’s loan investment in Curion Holdings,
LLC (“Curion”) recorded during the quarter ended September 30,
2022, investment income increased by $1.3 million primarily as a
result of increases in portfolio yield and average portfolio size.
Total expenses for the quarter ended December 31, 2022 totaled $9.6
million, compared to $9.7 million for the quarter ended September
30, 2022. The $0.1 million decrease in expenses during the quarter
was primarily driven by lower income taxes, primarily associated
with blocker entities that hold certain of the Company’s equity
investments, and lower incentive fees. These decreases were mostly
offset by an increase in interest and other debt financing expenses
due to the rising interest rate environment and higher average debt
outstanding.
Net gain (loss) was ($1.0) million for the quarter ended
December 31, 2022, compared to ($7.0) million for the quarter ended
September 30, 2022. Net realized and unrealized gains (losses) on
investments were ($0.3) million for the quarter. The net losses
during the quarter were primarily attributable to the Company’s
investment in SLF. Other net gains (losses) totaled ($0.7) million
for the quarter ended December 31, 2022, comprised primarily of net
unrealized losses on foreign currency forward contracts used to
hedge currency exposure on investments denominated in foreign
currency.
Net increase (decrease) in net assets resulting from operations
was $4.5 million, or $0.21 per share, for the quarter ended
December 31, 2022, compared to ($0.7) million, or ($0.03), for the
quarter ended September 30, 2022.
Results of Operations: Full Year 2022
Net investment income for the year ended December 31, 2022
totaled $22.2 million, or $1.02 per share, compared to $22.2
million, or $1.03 per share, for the year ended December 31, 2021.
Adjusted Net Investment Income was $23.6 million, or $1.09 per
share, for the year ended December 31, 2022, compared to $22.5
million, or $1.04 per share, for the year ended December 31, 2021.
Total investment income for the year ended December 31, 2022
totaled $56.6 million, compared to $53.8 million for the year ended
December 31, 2021. The increase as compared to the prior year was
primarily the result of increases portfolio yield resulting from
the rising rate environment (all of the portfolio exceed the
interest rate floors during the year ended December 31, 2022) and
the one-time benefit from the receipt of previously unrecorded
interest income associated with the repayment of the Company’s loan
investment in Curion. These increases were partially offset by
decreases in dividend income and prepayment gains. Total expenses,
net of incentive fee and management fee waivers, for the year ended
December 31, 2022 totaled $34.4 million, compared to $31.7 million
for the year ended December 31, 2021. The $2.7 million increase in
expenses was primarily driven by higher incentive fees, net of
associated fee waivers, increases in interest and other debt
financing expenses due to the rising interest rate environment, and
increases in income taxes, including excise taxes, primarily
associated with blocker entities that hold certain of the Company’s
equity investments.
Net gain (loss) was ($25.0) million for the year ended December
31, 2022, compared to $10.3 million for the year ended December 31,
2021. Net realized and unrealized gains (losses) on investments
were ($24.9) million for the year ended December 31, 2022. The net
losses on the portfolio were driven by the overall market
volatility and spread widening in the loan market, including
unrealized losses attributable to our investment in SLF of $6.1
million. Additionally, approximately $17.5 million in
net unrealized losses were attributable to portfolio companies that
have underlying credit performance concerns risk rating of Grade 3,
4 or 5 on the Company’s investment performance risk rating scale
that were still held as of December 31, 2022.
Net increase (decrease) in net assets resulting from operations
was ($2.8) million, or ($0.13) per share, for the year ended
December 31, 2022, compared to $32.5 million, or $1.51 per share,
for the year ended December 31, 2021.
Liquidity and Capital Resources
At December 31, 2022, the Company had $5.5 million in cash,
$204.6 million of debt outstanding on its revolving credit facility
and $130.0 million of debt outstanding on its 2026 Notes. As of
December 31, 2022, the Company had approximately $50.4 million
available for additional borrowings on its revolving credit
facility, subject to borrowing base availability.
MRCC Senior Loan Fund
SLF is a joint venture with Life Insurance Company of the
Southwest (“LSW”), an affiliate of National Life Insurance Company.
SLF invests primarily in senior secured loans to middle market
companies in the United States. The Company and LSW have each
committed $50.0 million of capital to the joint venture. As of
December 31, 2022, the Company had made net capital contributions
of $42.7 million in SLF with a fair value of $35.5 million, as
compared to net capital contributions of $42.7 million in SLF with
a fair value of $36.5 million at September 30, 2022. During the
quarter ended December 31, 2022, the Company received an income
distribution from SLF of $0.9 million, consistent with the $0.9
million received during the quarter ended September 30, 2022.
During the year ended December 31, 2022, the Company received
income distributions from SLF of $3.6 million, compared to the $4.3
million received for the year ended December 31, 2021. The SLF’s
underlying investments are loans to middle-market borrowers that
are generally larger than the rest of MRCC’s portfolio which is
focused on lower middle-market companies. The SLF’s portfolio
decreased in value by 0.1% during the quarter, from 93.6% of
amortized cost as of September 30, 2022 to 93.5% of amortized cost
as of December 31, 2022.
As of December 31, 2022, SLF had total assets of $192.8 million
(including investments at fair value of $183.2 million), total
liabilities of $121.8 million (including borrowings under the
$175.0 million secured revolving credit facility with Capital One,
N.A. (the “SLF Credit Facility”) of $122.2 million) and total
members’ capital of $71.0 million. As of September 30, 2022, SLF
had total assets of $201.6 million (including investments at fair
value of $192.1 million), total liabilities of $128.5 million
(including borrowings under the SLF Credit Facility of $129.3
million) and total members’ capital of $73.1 million.
Non-GAAP Financial Measure – Adjusted Net Investment
Income
On a supplemental basis, the Company discloses Adjusted Net
Investment Income (including on a per share basis) which is a
financial measure that is calculated and presented on a basis of
methodology other than in accordance with generally accepted
accounting principles of the United States of America (“non-GAAP”).
Adjusted Net Investment Income represents net investment income,
excluding the net capital gains incentive fee and income taxes. The
Company uses this non-GAAP financial measure internally in
analyzing financial results and believes that this non-GAAP
financial measure is useful to investors as an additional tool to
evaluate ongoing results and trends for the Company. The management
agreement with the Company’s advisor provides that a capital gains
incentive fee is determined and paid annually with respect to
realized capital gains (but not unrealized capital gains) to the
extent such realized capital gains exceed realized and unrealized
capital losses for such year. Management believes that Adjusted Net
Investment Income is a useful indicator of operations exclusive of
any net capital gains incentive fee as net investment income does
not include gains associated with the capital gains incentive
fee.
The following table provides a reconciliation from net
investment income (the most comparable GAAP measure) to Adjusted
Net Investment Income for the periods presented:
|
For the quarter ended |
|
December 31, 2022 |
|
September 30, 2022 |
|
Amount |
|
Per Share Amount |
|
Amount |
|
Per Share Amount |
|
(in thousands,
except per share data) |
Net investment income |
$ |
5,520 |
|
$ |
0.25 |
|
$ |
6,260 |
|
$ |
0.29 |
Net capital
gains incentive fee |
|
- |
|
|
- |
|
|
- |
|
|
- |
Income
taxes, including excise taxes |
|
116 |
|
|
0.01 |
|
|
868 |
|
|
0.04 |
Adjusted Net
Investment Income |
$ |
5,636 |
|
$ |
0.26 |
|
$ |
7,128 |
|
$ |
0.33 |
|
For the year ended |
|
December 31, 2022 |
|
December 31, 2021 |
|
Amount |
|
Per Share Amount |
|
Amount |
|
Per Share Amount |
|
(in thousands,
except per share data) |
Net investment income |
$ |
22,192 |
|
$ |
1.02 |
|
$ |
22,168 |
|
$ |
1.03 |
Net capital
gains incentive fee |
|
- |
|
|
- |
|
|
- |
|
|
- |
Income
taxes, including excise taxes |
|
1,405 |
|
|
0.07 |
|
|
282 |
|
|
0.01 |
Adjusted Net
Investment Income |
$ |
23,597 |
|
$ |
1.09 |
|
$ |
22,450 |
|
$ |
1.04 |
|
|
|
|
|
|
|
|
Adjusted Net Investment Income may not be comparable to similar
measures presented by other companies, as it is a non-GAAP
financial measure that is not based on a comprehensive set of
accounting rules or principles and therefore may be defined
differently by other companies. In addition, Adjusted Net
Investment Income should be considered in addition to, not as a
substitute for, or superior to, financial measures determined in
accordance with GAAP.
Fourth Quarter 2022 Financial Results Conference
Call
The Company will host a webcast and conference call to discuss
these operating and financial results on Thursday, March 2, 2023 at
11:00 am ET. The webcast will be hosted on a webcast link located
in the Investor Relations section of the Company’s website at
http://ir.monroebdc.com/events.cfm. To participate in the
conference call, please dial (800) 715-9871 approximately 10
minutes prior to the call. Please reference conference ID #
4627218.
For those unable to listen to the live broadcast, the webcast
will be available for replay on the Company’s website approximately
two hours after the event.
For a more detailed discussion of the financial and other
information included in this press release, please also refer to
the Company’s Form 10-K for the year ended December 31, 2022 to be
filed with the SEC (www.sec.gov) on March 1, 2023.
First Quarter 2023 Distribution
The Board of Directors of Monroe declared its first quarter
distribution of $0.25 per share, payable on March 31, 2023 to
stockholders of record on March 15, 2023. In October 2012, the
Company adopted a dividend reinvestment plan that provides for
reinvestment of distributions on behalf of its stockholders, unless
a stockholder elects to receive cash prior to the record date. When
the Company declares a cash distribution, stockholders who have not
opted out of the dividend reinvestment plan prior to the record
date will have their distribution automatically reinvested in
additional shares of the Company’s capital stock. The specific tax
characteristics of the distribution will be reported to
stockholders on Form 1099 after the end of the calendar year and in
the Company’s periodic report filed with the SEC.
MONROE CAPITAL CORPORATION |
CONSOLIDATED STATEMENTS OF ASSETS AND
LIABILITIES |
(in thousands, except per share data) |
|
|
|
|
|
|
|
|
December 31, 2022 |
|
|
|
September 30, 2022 |
|
|
|
December 31, 2021 |
|
|
|
|
|
|
|
(unaudited) |
|
|
|
|
|
ASSETS |
|
|
|
|
|
|
|
|
|
|
|
Investments, at fair
value: |
|
|
|
|
|
|
|
|
|
|
|
Non-controlled/non-affiliate company investments |
$ |
418,913 |
|
|
$ |
386,200 |
|
|
$ |
430,287 |
|
Non-controlled affiliate company investments |
|
86,618 |
|
|
|
85,274 |
|
|
|
90,281 |
|
Controlled affiliate company investments |
|
35,509 |
|
|
|
36,544 |
|
|
|
41,125 |
|
Total investments, at fair value (amortized cost of: $579,307,
$545,350 and $576,178, respectively) |
|
541,040 |
|
|
|
508,018 |
|
|
|
561,693 |
|
Cash |
|
5,450 |
|
|
|
7,129 |
|
|
|
2,622 |
|
Restricted cash |
|
- |
|
|
|
- |
|
|
|
15,459 |
|
Unrealized gain on foreign
currency forward contracts |
|
1,507 |
|
|
|
2,284 |
|
|
|
781 |
|
Interest receivable |
|
16,457 |
|
|
|
14,680 |
|
|
|
9,476 |
|
Other assets |
|
541 |
|
|
|
445 |
|
|
|
427 |
|
Total assets |
|
564,995 |
|
|
|
532,556 |
|
|
|
590,458 |
|
|
|
|
|
|
|
|
|
|
|
|
|
LIABILITIES |
|
|
|
|
|
|
|
|
|
|
|
Debt: |
|
|
|
|
|
|
|
|
|
|
|
Revolving credit facility |
|
204,600 |
|
|
|
171,200 |
|
|
|
151,045 |
|
2026 Notes |
|
130,000 |
|
|
|
130,000 |
|
|
|
130,000 |
|
SBA debentures payable |
|
- |
|
|
|
- |
|
|
|
56,900 |
|
Total debt |
|
334,600 |
|
|
|
301,200 |
|
|
|
337,945 |
|
Less: Unamortized deferred financing costs |
|
(4,486 |
) |
|
|
(3,223 |
) |
|
|
(5,794 |
) |
Total debt, less unamortized deferred financing costs |
|
330,114 |
|
|
|
297,977 |
|
|
|
332,151 |
|
Interest payable |
|
3,041 |
|
|
|
1,305 |
|
|
|
3,304 |
|
Management fees payable |
|
2,221 |
|
|
|
2,222 |
|
|
|
2,454 |
|
Incentive fees payable |
|
1,380 |
|
|
|
1,565 |
|
|
|
435 |
|
Accounts payable and accrued
expenses |
|
3,220 |
|
|
|
3,496 |
|
|
|
2,643 |
|
Directors' fees payable |
|
- |
|
|
|
35 |
|
|
|
- |
|
Total liabilities |
|
339,976 |
|
|
|
306,600 |
|
|
|
340,987 |
|
Net assets |
$ |
225,019 |
|
|
$ |
225,956 |
|
|
$ |
249,471 |
|
|
|
|
|
|
|
|
|
|
|
|
|
ANALYSIS OF NET ASSETS |
|
|
|
|
|
|
|
|
|
|
|
Common stock, $0.001 par
value, 100,000 shares authorized, 21,666, 21,666 and 21,666 shares
issued and outstanding, respectively |
$ |
22 |
|
|
$ |
22 |
|
|
$ |
22 |
|
Capital in excess of par
value |
|
298,700 |
|
|
|
298,687 |
|
|
|
298,687 |
|
Accumulated undistributed
(overdistributed) earnings |
|
(73,703 |
) |
|
|
(72,753 |
) |
|
|
(49,238 |
) |
Total net assets |
$ |
225,019 |
|
|
$ |
225,956 |
|
|
$ |
249,471 |
|
Net asset value per
share |
$ |
10.39 |
|
|
$ |
10.43 |
|
|
$ |
11.51 |
|
MONROE
CAPITAL CORPORATION |
CONSOLIDATED
STATEMENTS OF OPERATIONS |
(in
thousands, except per share data) |
|
|
|
|
|
|
|
|
|
For the quarter ended |
|
For the year ended |
|
December 31, 2022 |
|
September 30, 2022 |
|
December 31, 2022 |
|
December 31, 2021 |
|
(unaudited) |
|
(audited) |
Investment income: |
|
|
|
|
|
|
|
Non-controlled/non-affiliate company investments: |
|
|
|
|
|
|
|
Interest income |
$ |
9,721 |
|
|
$ |
9,383 |
|
|
$ |
35,751 |
|
|
$ |
33,381 |
|
Payment-in-kind interest income |
|
970 |
|
|
|
738 |
|
|
|
3,009 |
|
|
|
1,836 |
|
Dividend income |
|
105 |
|
|
|
103 |
|
|
|
372 |
|
|
|
400 |
|
Fee income |
|
776 |
|
|
|
412 |
|
|
|
2,380 |
|
|
|
1,231 |
|
Total investment income from non-controlled/non-affiliate company
investments |
|
11,572 |
|
|
|
10,636 |
|
|
|
41,512 |
|
|
|
36,848 |
|
Non-controlled affiliate company investments: |
|
|
|
|
|
|
|
Interest income |
|
1,383 |
|
|
|
3,830 |
|
|
|
7,585 |
|
|
|
5,150 |
|
Payment-in-kind interest income |
|
1,261 |
|
|
|
502 |
|
|
|
3,680 |
|
|
|
6,484 |
|
Dividend income |
|
48 |
|
|
|
48 |
|
|
|
189 |
|
|
|
987 |
|
Fee income |
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
36 |
|
Total investment income from non-controlled affiliate company
investments |
|
2,692 |
|
|
|
4,380 |
|
|
|
11,454 |
|
|
|
12,657 |
|
Controlled affiliate company investments: |
|
|
|
|
|
|
|
Dividend income |
|
900 |
|
|
|
900 |
|
|
|
3,600 |
|
|
|
4,325 |
|
Total investment income from controlled affiliate company
investments |
|
900 |
|
|
|
900 |
|
|
|
3,600 |
|
|
|
4,325 |
|
Total investment income |
|
15,164 |
|
|
|
15,916 |
|
|
|
56,566 |
|
|
|
53,830 |
|
|
|
|
|
|
|
|
|
Operating expenses: |
|
|
|
|
|
|
|
Interest and other debt financing expenses |
|
5,119 |
|
|
|
4,263 |
|
|
|
17,080 |
|
|
|
16,074 |
|
Base management fees |
|
2,221 |
|
|
|
2,222 |
|
|
|
9,055 |
|
|
|
9,514 |
|
Incentive fees |
|
1,380 |
|
|
|
1,565 |
|
|
|
4,127 |
|
|
|
3,690 |
|
Professional fees |
|
154 |
|
|
|
212 |
|
|
|
894 |
|
|
|
1,013 |
|
Administrative service fees |
|
255 |
|
|
|
275 |
|
|
|
1,163 |
|
|
|
1,357 |
|
General and administrative expenses |
|
360 |
|
|
|
216 |
|
|
|
1,082 |
|
|
|
1,072 |
|
Directors' fees |
|
39 |
|
|
|
35 |
|
|
|
148 |
|
|
|
144 |
|
Expenses before base management fee and incentive fee waivers |
|
9,528 |
|
|
|
8,788 |
|
|
|
33,549 |
|
|
|
32,864 |
|
Base management fee waivers |
|
- |
|
|
|
- |
|
|
|
(55 |
) |
|
|
- |
|
Incentive fee waivers |
|
- |
|
|
|
- |
|
|
|
(525 |
) |
|
|
(1,484 |
) |
Total operating expenses, net of base management fee and
incentive fee waivers |
|
9,528 |
|
|
|
8,788 |
|
|
|
32,969 |
|
|
|
31,380 |
|
Net investment income before income taxes |
|
5,636 |
|
|
|
7,128 |
|
|
|
23,597 |
|
|
|
22,450 |
|
Income taxes, including excise taxes |
|
116 |
|
|
|
868 |
|
|
|
1,405 |
|
|
|
282 |
|
Net investment income |
|
5,520 |
|
|
|
6,260 |
|
|
|
22,192 |
|
|
|
22,168 |
|
|
|
|
|
|
|
|
|
Net
gain (loss): |
|
|
|
|
|
|
|
Net realized gain (loss): |
|
|
|
|
|
|
|
Non-controlled/non-affiliate company investments |
|
620 |
|
|
|
(1,666 |
) |
|
|
(1,129 |
) |
|
|
(16,127 |
) |
Non-controlled affiliate company investments |
|
- |
|
|
|
(1 |
) |
|
|
(1 |
) |
|
|
(5,637 |
) |
Extinguishment of debt |
|
- |
|
|
|
- |
|
|
|
(1,039 |
) |
|
|
(3,110 |
) |
Foreign currency forward contracts |
|
50 |
|
|
|
38 |
|
|
|
119 |
|
|
|
(48 |
) |
Foreign currency and other transactions |
|
2 |
|
|
|
(1 |
) |
|
|
(36 |
) |
|
|
(895 |
) |
Net realized gain (loss) |
|
672 |
|
|
|
(1,630 |
) |
|
|
(2,086 |
) |
|
|
(25,817 |
) |
|
|
|
|
|
|
|
|
Net change in unrealized gain (loss): |
|
|
|
|
|
|
|
Non-controlled/non-affiliate company investments |
|
(6 |
) |
|
|
(1,049 |
) |
|
|
(12,287 |
) |
|
|
27,788 |
|
Non-controlled affiliate company investments |
|
106 |
|
|
|
(4,186 |
) |
|
|
(5,379 |
) |
|
|
4,950 |
|
Controlled affiliate company investments |
|
(1,035 |
) |
|
|
(1,007 |
) |
|
|
(6,116 |
) |
|
|
1,841 |
|
Foreign currency forward contracts |
|
(777 |
) |
|
|
863 |
|
|
|
726 |
|
|
|
894 |
|
Foreign currency and other transactions |
|
- |
|
|
|
- |
|
|
|
164 |
|
|
|
635 |
|
Net change in unrealized gain (loss) |
|
(1,712 |
) |
|
|
(5,379 |
) |
|
|
(22,892 |
) |
|
|
36,108 |
|
|
|
|
|
|
|
|
|
Net gain (loss) |
|
(1,040 |
) |
|
|
(7,009 |
) |
|
|
(24,978 |
) |
|
|
10,291 |
|
|
|
|
|
|
|
|
|
Net increase (decrease) in net assets resulting from
operations |
$ |
4,480 |
|
|
$ |
(749 |
) |
|
$ |
(2,786 |
) |
|
$ |
32,459 |
|
|
|
|
|
|
|
|
|
Per
common share data: |
|
|
|
|
|
|
|
Net
investment income per share - basic and diluted |
$ |
0.25 |
|
|
$ |
0.29 |
|
|
$ |
1.02 |
|
|
$ |
1.03 |
|
Net increase
(decrease) in net assets resulting from operations per share -
basic and diluted |
$ |
0.21 |
|
|
$ |
(0.03 |
) |
|
$ |
(0.13 |
) |
|
$ |
1.51 |
|
Weighted
average common shares outstanding - basic and diluted |
|
21,666 |
|
|
|
21,666 |
|
|
|
21,666 |
|
|
|
21,453 |
|
|
|
|
|
|
|
|
|
Additional Supplemental Information:
The composition of the Company’s investment income was as
follows (in thousands):
|
For the quarter ended |
|
For the year ended |
|
December 31, 2022 |
|
September 30, 2022 |
|
December 31, 2022 |
|
December 31, 2021 |
|
|
|
|
|
|
|
|
Interest income |
$ |
10,847 |
|
$ |
12,491 |
|
$ |
41,449 |
|
$ |
35,738 |
Payment-in-kind interest income |
|
2,231 |
|
|
1,240 |
|
|
6,689 |
|
|
8,320 |
Dividend
income |
|
1,053 |
|
|
1,051 |
|
|
4,161 |
|
|
5,712 |
Fee
income |
|
776 |
|
|
412 |
|
|
2,380 |
|
|
1,267 |
Prepayment
gain (loss) |
|
45 |
|
|
495 |
|
|
803 |
|
|
1,691 |
Accretion of
discounts and amortization of premiums |
|
212 |
|
|
227 |
|
|
1,084 |
|
|
1,102 |
Total investment income |
$ |
15,164 |
|
$ |
15,916 |
|
$ |
56,566 |
|
$ |
53,830 |
|
|
|
|
|
|
|
|
The composition of the Company’s interest expense and other debt
financing expenses was as follows (in thousands):
|
For the quarter ended |
|
For the year ended |
|
December 31, 2022 |
|
September 30, 2022 |
|
December 31, 2022 |
|
December 31, 2021 |
|
|
|
|
|
|
|
|
Interest expense - revolving credit facility |
$ |
3,051 |
|
$ |
2,186 |
|
|
8,442 |
|
$ |
4,593 |
Interest
expense - 2023 Notes |
|
- |
|
|
- |
|
|
- |
|
|
837 |
Interest
expense - 2026 Notes |
|
1,555 |
|
|
1,555 |
|
|
6,220 |
|
|
5,763 |
Interest
expense - SBA debentures |
|
- |
|
|
- |
|
|
292 |
|
|
2,676 |
Amortization
of deferred financing costs |
|
513 |
|
|
522 |
|
|
2,126 |
|
|
2,205 |
Total interest and other debt financing expenses |
$ |
5,119 |
|
$ |
4,263 |
|
$ |
17,080 |
|
$ |
16,074 |
|
|
|
|
|
|
|
|
ABOUT MONROE CAPITAL CORPORATIONMonroe Capital
Corporation is a publicly-traded specialty finance company that
principally invests in senior, unitranche and junior secured debt
and, to a lesser extent, unsecured debt and equity investments in
middle-market companies. The Company’s investment objective is to
maximize the total return to its stockholders in the form of
current income and capital appreciation. The Company’s investment
activities are managed by its investment adviser, Monroe Capital
BDC Advisors, LLC, which is an investment adviser registered under
the Investment Advisers Act of 1940, as amended, and an affiliate
of Monroe Capital LLC. To learn more about Monroe Capital
Corporation, visit www.monroebdc.com.
ABOUT MONROE CAPITAL LLC Monroe Capital
LLC (“Monroe”) is a premier boutique asset management firm
specializing in private credit markets across various strategies,
including direct lending, asset-based lending, specialty finance,
opportunistic and structured credit, and equity. Since 2004, the
firm has been successfully providing capital solutions to clients
in the U.S. and Canada. Monroe prides itself on being a value-added
and user-friendly partner to business owners, management, and both
private equity and independent sponsors. Monroe’s platform offers a
wide variety of investment products for both institutional and high
net worth investors with a focus on generating high quality “alpha”
returns irrespective of business or economic cycles. The firm is
headquartered in Chicago and maintains offices in Atlanta, Boston,
Los Angeles, Miami, Naples, New York, San Francisco, and Seoul.
Monroe has been recognized by both its peers and investors with
various awards including Private Debt Investor as the 2022 Lower
Mid-Market Lender of the Year, 2022 CLO Manager of the Year,
Americas; Global M&A Network as the 2022 Small Mid-Markets
Lender of the Year, Americas; Creditflux as the 2021 Best U.S.
Direct Lending Fund; and Pension Bridge as the 2020 Private Credit
Strategy of the Year. For more information and important
disclaimers, please visit www.monroecap.com.
FORWARD-LOOKING STATEMENTS This press release
may contain certain forward-looking statements. Any such
statements, other than statements of historical fact, are likely to
be affected by other unknowable future events and conditions,
including elements of the future that are or are not under the
Company’s control, and that the Company may or may not have
considered; accordingly, such statements cannot be guarantees or
assurances of any aspect of future performance. Actual developments
and results are highly likely to vary materially from these
estimates and projections of the future. Such statements speak only
as of the time when made, and the Company undertakes no obligation
to update any such statement now or in the future.
SOURCE: Monroe Capital Corporation
Investor Contact: |
Mick SolimeneChief Investment Officer and Chief Financial
OfficerMonroe Capital Corporation(312) 598-8401Email:
msolimene@monroecap.com |
|
|
Media Contact: |
Daniel AbramsonBackBay
Communications(857) 305-8441Email:
daniel.abramson@backbaycommunications.com |
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