Eagle Point Credit Company Inc. (the “Company”) (NYSE: ECC,
ECCC, ECC PRD, ECCF, ECCV, ECCW, ECCX) today announced financial
results for the quarter ended March 31, 2024 and certain additional
activity through April 30, 2024.
“The Company had a solid start to the year, deploying $131.1
million in net capital into new investments that we expect to
generate attractive risk-adjusted returns and enhance our net
investment income moving forward,” said Thomas P. Majewski, Chief
Executive Officer. “For the first quarter, we generated net
investment income and realized capital gains, excluding
non-recurring expenses, of $0.31 per share. In addition, we
strengthened our balance sheet by issuing common stock at a premium
to NAV as well as through issuing our new 8.00% Series F Term
Preferred Stock. Looking ahead, we expect to further grow our
portfolio through attractive CLO equity investments in both the new
issue and secondary markets and improve our portfolio’s expected
yield with an increase in refinancing and reset activity.”
FIRST QUARTER 2024 RESULTS
- Net asset value (“NAV”) per common share of $9.16 as of March
31, 2024, compared to $9.21 as of December 31, 2023.
- Net investment income (“NII”) and realized capital gains of
$0.29 per weighted average common share, which is net of a
non-recurring expense of $0.02 per share related to the issuance of
the Company’s 8.00% Series F Term Preferred Stock due 2029 (the
“Series F Term Preferred Stock”).1,2 This compares to $0.33 of NII
and realized capital gains per weighted average common share for
the quarter ended December 31, 2023, and $0.32 of NII less realized
capital losses per weighted average common share for the quarter
ended March 31, 2023.
- GAAP net income (inclusive of unrealized mark-to-market gains)
of $34.7 million, or $0.43 per weighted average common share.
- Received $56.2 million in recurring cash distributions3 from
the Company’s investment portfolio, or $0.70 per weighted average
common share, which was in line with the Company’s aggregate
distributions on its common stock and operating costs for the
quarter.
- Deployed $131.1 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 19.4% as measured
at the time of investment.
- As of March 31, 2024:
- The weighted average effective yield of the Company’s CLO
equity portfolio (excluding called CLOs), based on amortized cost,
was 16.43%. This compares to 16.70% as of December 31, 2023 and
15.83% as of March 31, 2023.4
- The weighted average expected yield of the Company’s CLO equity
portfolio (excluding called CLOs), based on fair market value, was
23.96%. This compares to 27.10% as of December 31, 2023 and 25.96%
as of March 31, 2023.4
- Completed an underwritten public offering of $49.0 million in
aggregate principal amount of Series F Term Preferred Stock,
resulting in net proceeds to the Company of approximately $47.1
million.
- Issued approximately 7.9 million shares of common stock,
317,387 shares of 6.75% Series D Preferred Stock (the “Series D
Preferred Stock”) and 96,772 shares of Series F Term Preferred
Stock pursuant to the Company’s “at-the-market” offering program
for total net proceeds of approximately $86.3 million. The common
stock issuance resulted in $0.06 per share of NAV accretion for the
quarter ended March 31, 2024.
- As of March 31, 2024, the Company had debt and preferred equity
securities outstanding which totaled approximately 29.2% of its
total assets (less current liabilities).5
- As of March 31, 2024, 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 1,793 unique corporate
obligors.
- The largest look-through obligor represented 0.7% of the loans
underlying the Company’s CLO equity portfolio.
- The top-ten largest look-through obligors together represented
5.2% 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 3.74% as of March
2024, down 5 basis points from December 2023.
- GAAP net income was comprised of total investment income of
$40.8 million, total net unrealized appreciation on investments of
$7.8 million, net unrealized depreciation on certain liabilities
held at fair value of $2.9 million and realized capital gains of
$1.1 million, partially offset by financing costs and operating
expenses of $17.9 million.
- Recorded other comprehensive loss of $4.6 million.
SECOND QUARTER 2024 PORTFOLIO ACTIVITY THROUGH APRIL 30, 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 $8.94 and $9.04 as of April 30, 2024.
- Received $65.7 million of recurring cash distributions from the
Company’s investment portfolio. As of April 30, 2024, some of the
Company’s investments had not yet reached their payment date for
the quarter.
- Deployed $20.8 million of net capital into CLO equity, CLO
debt, loan accumulation facilities and other investments.
- Began issuing Series AA and Series AB 7.00% Convertible and
Perpetual Preferred Stock.
DISTRIBUTIONS
As previously announced, the Company has declared the following
monthly distributions on its common stock, 6.50% Series C Term
Preferred Stock due 2031 (the “Series C Term Preferred Stock”),
Series D Preferred Stock and Series F Term Preferred Stock.6
Security
Amount per
Share
Record Dates
Payable Dates
Common Stock Regular
$0.14
May 13, 2024,
June 10, 2024,
July 11, 2024,
August 12, 2024,
September 10, 2024
May 31, 2024,
June 28, 2024,
July 31, 2024,
August 30, 2024,
September 30, 2024
Common Stock Supplemental
$0.02
Series C Term Preferred Stock
$0.135417
Series D Preferred Stock
$0.140625
Series F Term Preferred Stock
$0.166667
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 ended March 31, 2024, 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). Please reference Conference ID 13745709 when
calling, and the Company recommends dialing in 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 June 21, 2024. To hear the replay, please dial
(844) 512-2921 (toll-free) or (412) 317-6671 (international). For
the replay, enter Conference ID 13745709.
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 unaudited consolidated
financial statements as of and for the period ended March 31, 2024.
The Company has also filed this report with the U.S. Securities and
Exchange Commission (“SEC”). 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 ended March 31,
2024.
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 CLOs. 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 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
prospectus and the Company’s other filings with the SEC. 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 quarterly unaudited 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/20240521547614/en/
Investor and Media Relations: ICR 203-340-8510
IR@EaglePointCredit.com www.eaglepointcreditcompany.com
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