Great Elm Capital Corp. Announces Fourth Quarter and Full Year 2022 Financial Results
Fourth Quarter and Other Recent Highlights:
- Net investment income (“NII”) for the quarter ended
December 31, 2022was $2.3 million, or $0.30per share, more than doubling NII of $1.1 million, or $0.14per share for the quarter ended September 30, 2022.
- NII was positively impacted by continued capital deployment, rotation into higher yielding floating rate investments and lower expenses.
- Net assets were
$84.8 million, or $11.16per share, on December 31, 2022, as compared to $95.5 million, or $12.56per share, on September 30, 2022, and $74.6 million, or $16.63per share, on December 31, 2021.
- Net assets for the quarter were negatively impacted by unrealized losses on certain investments.
- Partnered with an affiliate of
Berkadia Commercial Mortgage, LLC(“Berkadia”) to form Great Elm Healthcare Finance, LLC(“GEHF”), a specialty, asset-based lending platform formed to provide capital to healthcare-related businesses across the U.S.
December 2022, GEHF closed on the purchase of three healthcare asset-based loans.
- GECC’s asset coverage ratio was approximately 154.4% as of
December 31, 2022, as compared to 165.5% as of September 30, 2022, and 151.1% as of December 31, 2021.
- The Board of Directors has approved a quarterly dividend of
$0.35per share for the first quarter of 2023, equating to a 12.5% annualized yield on December 31, 2022NAV per share.
“During the fourth quarter, we generated the highest amount of cash income from interest, dividends and fees in the Company’s history,” said
Financial Highlights – Per Share Data
|Earnings Per Share (“EPS”)||(
|Net Investment Income (“NII”) Per Share|
|Pre-Incentive Net Investment Income Per Share|
|Net Realized and Unrealized Gains / (Losses) Per Share||(
|Net Asset Value Per Share at Period End|
|Distributions Paid / Declared Per Share|
Portfolio and Investment Activity
- 44 debt investments in corporate credit, totaling approximately
$151.2 millionand representing 67.2% of the fair market value of the Company’s total investments. Secured debt investments comprised a substantial majority of the fair market value of the Company’s debt investments.
- 10 debt investments in specialty finance, totaling approximately
$33.8 millionand representing 15.0% of the fair market value of the Company’s total investments.
- 4 income generating equity investments in specialty finance companies, totaling approximately
$24.5 million, representing 10.9% of the fair market value of the Company’s total investments.
- 6 other income generating equity investments, totaling approximately
$12.9 million, representing 5.7% of the fair market value of the Company’s total investments.
- Other equity investments, totaling approximately
$2.6 million, representing 1.2% of the fair market value of the Company’s total investments.
During the quarter ended
During the quarter ended
Total investment income for the quarter ended
Net realized and unrealized losses for the quarter ended
Liquidity and Capital Resources
Total debt outstanding (par value) as of
The Company’s Board of Directors has approved a quarterly cash distribution of
The distribution equates to a 14.8% annualized dividend yield on the Company’s closing market price on
|Conference Call and Webcast|
|GECC will discuss these results in a conference call today at
|Conference Call Details|
|Participant Dial-In Numbers:|
To access the call, please dial-in approximately five minutes before the start time and, when asked, provide the operator with passcode “GECC”. An accompanying slide presentation will be available in pdf format via the “Investor Relations” section of Great Elm Capital Corp.’s website here after the issuance of the earnings release.
The call and presentation will also be simultaneously webcast over the internet via the Investor Relations section of GECC’s website or by clicking on the conference call link here.
Cautionary Statement Regarding Forward-Looking Statements
Statements in this communication that are not historical facts are “forward-looking” statements within the meaning of the federal securities laws. These statements are often, but not always, made through the use of words or phrases such as “expect,” “anticipate,” “should,” “will,” “estimate,” “designed,” “seek,” “continue,” “upside,” “potential” and similar expressions. All such forward-looking statements involve estimates and assumptions that are subject to risks, uncertainties and other factors that could cause actual results to differ materially from the results expressed in the statements. Among the key factors that could cause actual results to differ materially from those projected in the forward-looking statements are: conditions in the credit markets, rising interest rates, inflationary pressure, the price of GECC common stock and the performance of GECC’s portfolio and investment manager. Information concerning these and other factors can be found in GECC’s Annual Report on Form 10-K and other reports filed with the
This press release does not constitute an offer of any securities for sale.
|(1)||The per share figures are based on a weighted average outstanding share count for the respective period following the 6-for-1 reverse stock split effective on
|(2)||This includes new deals, additional fundings (inclusive of those on revolving credit facilities), refinancings and capitalized PIK income. Amounts included herein do not include investments in short-term securities, including United States Treasury Bills.|
|(3)||This includes scheduled principal payments, prepayments, sales and repayments (inclusive of those on revolving credit facilities). Amounts included herein do not include investments in short-term securities, including United States Treasury Bills.|
Media & Investor Contact:
CONSOLIDATED STATEMENTS OF ASSETS AND LIABILITIES
Dollar amounts in thousands (except per share amounts)
|Non-affiliated, non-controlled investments, at fair value (amortized cost of
|Non-affiliated, non-controlled short-term investments, at fair value (amortized cost of
|Affiliated investments, at fair value (amortized cost of
|Controlled investments, at fair value (amortized cost of
|Cash and cash equivalents||587||9,132|
|Receivable for investments sold||396||766|
|Due from portfolio company||1||136|
|Due from affiliates||-||17|
|Deferred financing costs||226||376|
|Prepaid expenses and other assets||3,288||379|
|Notes payable (including unamortized discount of
|Revolving credit facility||10,000||-|
|Payable for investments purchased||70,022||203,575|
|Accrued incentive fees payable||565||4,854|
|Due to affiliates||1,042||1,012|
|Accrued expenses and other liabilities||480||290|
|Commitments and contingencies||$||-||$||-|
|Common stock, par value
7,601,958 shares issued and outstanding and 4,484,278 shares issued and
|Additional paid-in capital||284,359||245,531|
|Total net assets||$||84,809||$||74,556|
|Total liabilities and net assets||$||310,112||$||426,314|
|Net asset value per share||(1||)||$||11.16||$||16.63|
|(1)||Authorized, issued and outstanding shares of common stock and net asset value per share have been adjusted for the periods shown to reflect the six-for-one reverse stock split effected on
CONSOLIDATED STATEMENTS OF OPERATIONS
Dollar amounts in thousands (except per share amounts)
|For the Year Ended
|Interest income from:|
|Non-affiliated, non-controlled investments||$||15,325||$||13,100||$||12,740|
|Non-affiliated, non-controlled investments (PIK)||1,220||387||22|
|Affiliated investments (PIK)||58||4,874||5,218|
|Total interest income||18,684||19,917||19,210|
|Dividend income from:|
|Non-affiliated, non-controlled investments||1,815||1,713||867|
|Total dividend income||4,354||4,347||3,107|
|Other income from:|
|Non-affiliated, non-controlled investments||1,391||683||125|
|Non-affiliated, non-controlled investments (PIK)||-||-||368|
|Affiliated investments (PIK)||-||282||75|
|Total other income||1,391||990||580|
|Total investment income||$||24,429||$||25,254||$||22,897|
|Incentive fee waiver||(4,854||)||-||-|
|Net investment income before taxes||$||10,713||$||12,333||$||7,166|
|Net investment income||$||10,461||$||12,285||$||7,149|
|Net realized and unrealized gains (losses):|
|Net realized gain (loss) on investment transactions from:|
|Non-affiliated, non-controlled investments||$||(15,262||)||$||(5,770||)||$||(9,604||)|
|Realized gain on repurchase of debt||-||-||1,237|
|Total net realized gain (loss)||(126,046||)||(9,639||)||(9,749||)|
|Net change in unrealized appreciation (depreciation) on investment transactions from:|
|Non-affiliated, non-controlled investments||267||19,019||(14,520||)|
|Total net change in unrealized appreciation (depreciation)||100,002||(12,921||)||(29,356||)|
|Net realized and unrealized gains (losses)||$||(26,044||)||$||(22,560||)||$||(39,105||)|
|Net increase (decrease) in net assets resulting from operations||$||(15,583||)||$||(10,275||)||$||(31,956||)|
|Net investment income per share (basic and diluted):||(1||)||$||1.67||$||3.02||$||3.22|
|Earnings per share (basic and diluted):||(1||)||$||(2.49||)||$||(2.52||)||$||(14.41||)|
|Weighted average shares outstanding (basic and diluted):||(1||)||6,251,391||4,073,454||2,218,244|
|(1)||Weighted average shares outstanding and per share amounts have been adjusted for the periods shown to reflect the six-for-one reverse stock split effected on
Source: Great Elm Capital Corp.