Eagle Point Credit Company Inc. (the “Company”) (NYSE: ECC,
ECCC, ECC PRD, ECCF, ECCV, ECCW, ECCX) today announced financial
results for the quarter and fiscal year ended December 31, 2023 and
certain additional activity through February 15, 2024.
“The Company had a very good 2023. We generated a GAAP return of
20.79% in 2023 for our shareholders. Our portfolio generated strong
cash flows each quarter and we sourced attractive investments for
the Company throughout the year,” said Thomas P. Majewski, Chief
Executive Officer. “During the fourth quarter, we deployed $34
million into new investments. The secondary market CLO equity we
purchased during the quarter had a weighted average effective yield
of 22.9%, further positioning the portfolio to enhance net
investment income over time.”
“For the fourth quarter, we generated net investment income and
realized capital gains of $0.33 per share. We also strengthened our
balance sheet through our ‘at-the-market’ program by issuing common
stock at a premium to NAV, which generated $0.03 per share of NAV
accretion. The Company further enhanced its liquidity early in 2024
with the issuance of our 8.00% Series F Term Preferred Stock, which
produced $47.1 million in net proceeds,” concluded Mr.
Majewski.
FOURTH QUARTER 2023 RESULTS
- Net asset value (“NAV”) per common share of $9.21 as of
December 31, 2023, compared to $9.33 as of September 30, 2023.
- Net investment income (“NII”) and realized capital gains of
$0.33 per weighted average common share.1,2 This compares to $0.35
of NII and realized capital gains per weighted average common share
for the quarter ended September 30, 2023, and $0.29 of NII less
realized capital losses per weighted average common share for the
quarter ended December 31, 2022.
- GAAP net income (inclusive of unrealized mark-to-market gains)
of $27.1 million, or $0.37 per weighted average common share.
- Received $60.7 million in recurring cash distributions3 from
the Company’s investment portfolio, or $0.82 per weighted average
common share, which was in excess of the Company’s aggregate
distributions on its common stock and operating costs for the
quarter.
- Deployed $34 million in net capital into collateralized loan
obligation (“CLO”) equity, CLO debt, loan accumulation facilities
and other investments. The weighted average effective yield of new
CLO equity investments made by the Company during the quarter,
which includes a provision for credit losses, was 22.9% as measured
at the time of investment.
- As of December 31, 2023:
- The weighted average effective yield of the Company’s CLO
equity portfolio (excluding called CLOs), based on amortized cost,
was 16.70%. This compares to 16.29% as of September 30, 2023 and
16.23% as of December 31, 2022.4
- The weighted average expected yield of the Company’s CLO equity
portfolio (excluding called CLOs), based on fair market value, was
27.10%. This compares to 27.38% as of September 30, 2023 and 27.86%
as of December 31, 2022.4
- Issued approximately 4.5 million shares of common stock
pursuant to the Company’s “at-the-market” offering program for
total net proceeds of approximately $42.5 million. The common stock
issuance resulted in $0.03 per share of NAV accretion for the
quarter ended December 31, 2023.
- As of December 31, 2023, the Company had debt and preferred
equity securities outstanding which totaled approximately 27.0% of
its total assets (less current liabilities).5
- As of December 31, 2023, on a look-through basis, and based on
the most recent CLO trustee reports received by such date:
- The Company, through its investments in CLO equity securities,
had indirect exposure to approximately 1,796 unique corporate
obligors.
- The largest look-through obligor represented 0.8% of the loans
underlying the Company’s CLO equity portfolio.
- The top-ten largest look-through obligors together represented
5.4% of the loans underlying the Company’s CLO equity
portfolio.
- The look-through weighted average spread of the loans
underlying the Company’s CLO equity portfolio was 3.79% as of
December 2023, up 1 basis point from September 2023.
- GAAP net income was comprised of total investment income of
$39.4 million, total net unrealized appreciation on investments of
$10.1 million and realized capital gains of $0.2 million, partially
offset by financing costs and operating expenses of $14.6 million
and net unrealized appreciation on certain liabilities held at fair
value of $8.0 million.
- Recorded other comprehensive loss of $1.2 million.
FULL YEAR 2023 HIGHLIGHTS
- For the fiscal year ended December 31, 2023, the Company
recorded GAAP net income of $116.9 million. Fiscal year GAAP net
income was comprised of total investment income of $139.1 million
and total net unrealized appreciation on investments of $50.5
million, partially offset by financing costs and operating expenses
of $52.8 million, realized capital losses of $16.4 million and net
unrealized appreciation on certain liabilities held at fair value
of $3.5 million.
- For the fiscal year ended December 31, 2023, the Company
received $208.5 million of recurring cash distributions from its
investment portfolio, or $3.22 per weighted average common
share.
- Recorded other comprehensive loss of $5.9 million.
FIRST QUARTER 2024 PORTFOLIO ACTIVITY THROUGH FEBRUARY 15,
2024 AND OTHER UPDATES
- As previously published on the Company’s website, management’s
estimate of the range of the Company’s NAV per common share is
estimated to be between $9.22 and $9.32 as of January 31, 2024. At
the midpoint of the range, this represents a 0.7% increase from
year end.
- Received $50.4 million of recurring cash distributions from the
Company’s investment portfolio. As of February 15, 2024, some of
the Company’s investments had not yet reached their payment date
for the quarter.
- Deployed $95.5 million of net capital into CLO equity, CLO
debt, loan accumulation facilities and other investments.
- Completed an underwritten public offering of $49.0 million in
aggregate principal amount of 8.00% Series F Term Preferred Stock
due 2029 (the “Series F Term Preferred Stock”), resulting in net
proceeds to the Company of approximately $47.1 million.
DISTRIBUTIONS
As previously announced, the Company has declared the following
monthly distributions to its common stock, 6.50% Series C Term
Preferred Stock due 2031 (the “Series C Term Preferred Stock”) and
6.75% Series D Preferred Stock (the “Series D Preferred
Stock”).6
Security
Amount per
Share
Record Dates
Payable Dates
Common Stock Regular
$0.14
February 9, 2024,
March 8, 2024,
April 10, 2024,
May 13, 2024,
June 10, 2024
February 29, 2024,
March 28, 2024,
April 30, 2024,
May 31, 2024,
June 28, 2024
Common Stock Supplemental
$0.02
Series C Term Preferred Stock
$0.135417
Series D Preferred Stock
$0.140625
The Company has also declared the following monthly
distributions to its Series F Term Preferred Stock.
Security
Amount per
Share
Record Dates
Payable Dates
Series F Term Preferred Stock
$0.227778
February 9, 2024
February 29, 2024
Series F Term Preferred Stock
$0.166667
March 8, 2024,
April 10, 2024,
May 13, 2024,
June 10, 2024
March 28, 2024,
April 30, 2024,
May 31, 2024,
June 28, 2024
CONFERENCE CALL
The Company will host a conference call at 10:00 a.m. (Eastern
Time) today to discuss the Company’s financial results for the
quarter and full year ended December 31, 2023, as well as a
portfolio update.
All interested parties may participate in the conference call by
dialing (877) 407-0789 (toll-free) or (201) 689-8562
(international), and referencing Conference ID 13743436
approximately 10 to 15 minutes prior to the call.
A live webcast will also be available on the Company’s website
(www.eaglepointcreditcompany.com). Please go to the Investor
Relations section at least 15 minutes prior to the call to
register, download and install any necessary audio software.
An archived replay of the call will be available shortly
afterwards until March 22, 2024. To hear the replay, please dial
(844) 512-2921 (toll-free) or (412) 317-6671 (international). For
the replay, enter Conference ID 13743436.
ADDITIONAL INFORMATION
The Company has made available on the investor relations section
of its website, www.eaglepointcreditcompany.com (in the financial
statements and reports section), its 2023 Annual Report, which
includes the Company’s audited consolidated financial statements as
of and for the period ended December 31, 2023. The Company also
published on its website (in the presentations and events section)
an investor presentation, which contains additional information
about the Company and its portfolio as of and for the quarter and
year ended December 31, 2023. The Company has filed these reports
with the Securities and Exchange Commission.
ABOUT EAGLE POINT CREDIT COMPANY
The Company is a non-diversified, closed-end management
investment company. The Company’s primary investment objective is
to generate high current income, with a secondary objective to
generate capital appreciation, primarily by investing in equity and
junior debt tranches of collateralized loan obligations. The
Company is externally managed and advised by Eagle Point Credit
Management LLC.
The Company makes certain unaudited portfolio information
available each month on its website in addition to making certain
other unaudited financial information available on its website
(www.eaglepointcreditcompany.com). This information includes (1) an
estimated range of the Company’s net investment income (“NII”) and
realized capital gains or losses per share of common stock for each
calendar quarter end, generally made available within the first
fifteen days after the applicable calendar month end, (2) an
estimated range of the Company’s NAV per share of common stock for
the prior month end and certain additional portfolio-level
information, generally made available within the first fifteen days
after the applicable calendar month end and (3) during the latter
part of each month, an updated estimate of NAV, if applicable, and,
with respect to each calendar quarter end, an updated estimate of
the Company’s NII and realized capital gains or losses per share
for the applicable quarter, if available.
FORWARD-LOOKING STATEMENTS
This press release may contain “forward-looking statements”
within the meaning of the Private Securities Litigation Reform Act
of 1995. Statements other than statements of historical facts
included in this press release may constitute forward-looking
statements and are not guarantees of future performance or results
and involve a number of risks and uncertainties. Actual results may
differ materially from those in the forward-looking statements as a
result of a number of factors, including those described in the
Company’s filings with the U.S. Securities and Exchange Commission.
The Company undertakes no duty to update any forward-looking
statement made herein. All forward-looking statements speak only as
of the date of this press release.
______________________________ 1 “Per weighted average common
share” is based on the average daily number of shares of common
stock outstanding for the period and “per common share” refers to
per share of the Company’s common stock. 2 NII is net of
distributions made on the Company’s Series D Preferred Stock of
$0.01 per weighted average common share. 3 “Recurring cash
distributions” refers to the quarterly distributions received by
the Company from its CLO equity, CLO debt and other investments and
distributions from loan accumulation facilities in excess of
capital invested and excludes funds received from CLOs called. 4
Weighted average effective yield is based on an investment’s
amortized cost whereas weighted average expected yield is based on
an investment’s fair market value as of the applicable period end
as disclosed in the Company’s financial statements, which is
subject to change from period to period. Please refer to the
Company’s audited financial statements for additional disclosures.
5 Over the long-term, management expects to generally operate the
Company with leverage within a range of 25% to 35% of total assets
under normal market conditions. Based on applicable market
conditions at any given time, or should significant opportunities
present themselves, the Company may incur leverage outside of this
range, subject to applicable regulatory limits. 6 The ability of
the Company to declare and pay distributions on stock is subject to
a number of factors, including the Company’s results of operations.
Distributions on stock are generally paid from net investment
income (regular interest and dividends) and may also include
capital gains and/or a return of capital. The actual components of
the Company’s distributions for U.S. tax reporting purposes can
only be finally determined as of the end of each fiscal year of the
Company and are thereafter reported on Form 1099-DIV.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20240222142379/en/
Investor and Media Relations: ICR 203-340-8510
IR@EaglePointCredit.com www.eaglepointcreditcompany.com
Eagle Point Credit (NYSE:ECCW)
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