PennantPark Floating Rate Capital Ltd. Announces Its Financial Results for the Quarter Ended June 30, 2023
- Net investment income of $18.5 million
- Investment portfolio of $1,105.3 million
- Purchases of investments: $80.0 million
- Sales and repayments of investments: $132.4 million
- Quarterly decrease in GAAP net asset value per share: 1.7%
MIAMI, Aug. 09, 2023 (GLOBE NEWSWIRE) -- PennantPark Floating Rate Capital Ltd. (NYSE: PFLT) (TASE: PFLT) announced today its financial results for the third quarter ended June 30, 2023.
HIGHLIGHTS
Quarter ended June 30, 2023 (unaudited)
($ in millions, except per share amounts)
Operating Results: | |||
Net investment income | $ | 18.5 | |
Net investment income per share | $ | 0.36 | |
Core net investment income per share (1) | $ | 0.31 | |
Distributions declared per share | $ | 0.30 | |
Assets and Liabilities: | |||
Investment portfolio (2) | $ | 1,105.3 | |
Net assets | $ | 608.4 | |
GAAP net asset value per share | $ | 10.96 | |
Quarterly decrease in GAAP net asset value per share | (1.7 | )% | |
Adjusted net asset value per share (3) | $ | 11.00 | |
Quarterly decrease in adjusted net asset value per share (3) | (0.9 | )% | |
Credit Facility | $ | 63.9 | |
2023 Notes | $ | 79.3 | |
2026 Notes | $ | 182.9 | |
2031 Asset-Backed Debt | $ | 226.6 | |
Regulatory Debt to Equity | 0.91x | ||
Weighted average yield on debt investments at quarter-end | 12.4 | % | |
Portfolio Activity: | |||
Purchases of investments | $ | 80.0 | |
Sales and repayments of investments | $ | 132.4 | |
PSSL Portfolio data: | |||
PSSL investment portfolio | $ | 805.2 | |
Purchases of investments | $ | 77.8 | |
Sales and repayments of investments | $ | 40.8 |
______________________
(1) | Core net investment income (“Core NII”) is a non-GAAP financial measure. The Company believes that Core NII provides useful information to investors and management because it reflects the Company's financial performance excluding one-time or non-recurring investment income and expenses. The presentation of this additional information is not meant to be considered in isolation or as a substitute for financial results prepared in accordance with GAAP. For the quarter ended June 30, 2023, Core NII excluded: i) |
(2) | Includes investments in PennantPark Senior Secured Loan Fund I LLC ("PSSL"), an unconsolidated joint venture, totaling |
(3) | This is a non-GAAP financial measure. The Company believes that this number provides useful information to investors and management because it reflects the Company’s financial performance excluding the impact of the |
CONFERENCE CALL AT 9:00 A.M. ET ON AUGUST 10, 2023
The Company will also host a conference call at 9:00 a.m. (Eastern Time) on Thursday August 10, 2023 to discuss its financial results. All interested parties are welcome to participate. You can access the conference call by dialing toll-free (888) 204-4368 approximately 5-10 minutes prior to the call. International callers should dial (646) 828-8193. All callers should reference conference ID #9543827 or PennantPark Floating Rate Capital Ltd. An archived replay will also be available on a webcast link located on the Quarterly Earnings page in the Investor section of PennantPark’s website.
PORTFOLIO AND INVESTMENT ACTIVITY
“We are pleased to be in a position to take advantage of this excellent vintage of loans in the core middle market,” said Art Penn, Chairman and CEO. “We believe that we have a visible pathway of driving meaningfully increased income through the growing balance sheets of PFLT and our PSSL joint venture.”
PennantPark Floating Rate Capital Ltd.
As of June 30, 2023, our portfolio totaled
As of September 30, 2022, our portfolio totaled
For the three months ended June 30, 2023, we invested
For the three months ended June 30, 2022, we invested
PennantPark Senior Secured Loan Fund I LLC
As of June 30, 2023, PSSL’s portfolio totaled
As of September 30, 2022, PSSL’s portfolio totaled
For the three months ended June 30, 2023, PSSL invested
For the three months ended June 30, 2022, PSSL invested
RESULTS OF OPERATIONS
Set forth below are the results of operations for the three and nine months ended June 30, 2023 and 2022.
Investment Income
For the three and nine months ended June 30, 2023, investment income was
Expenses
For the three and nine months ended June 30, 2023, expenses totaled
Net Investment Income
For the three and nine months ended June 30, 2023, net investment income totaled
Net Realized Gains or Losses
For the three and nine months ended June 30, 2023, net realized gains (losses) totaled
Unrealized Appreciation or Depreciation on Investments and Debt
For the three and nine months ended June 30, 2023, we reported net change in unrealized appreciation (depreciation) on investments of
For the three and nine months ended June 30, 2023, our Credit Facility and the 2023 Notes had a net change in unrealized appreciation (depreciation) of
Net Increase (Decrease) in Net Assets Resulting from Operations
For the three and nine months ended June 30, 2023, net increase (decrease) in net assets resulting from operations totaled
LIQUIDITY AND CAPITAL RESOURCES
Our liquidity and capital resources are derived primarily from cash flows from operations, including income earned, proceeds from investment sales and repayments, and proceeds of securities offerings and debt financings. Our primary use of funds from operations includes investments in portfolio companies and payments of fees and other operating expenses we incur. We have used, and expect to continue to use, our debt capital, proceeds from our portfolio and proceeds from public and private offerings of securities to finance our investment objectives and operations.
As of June 30, 2023 and September 30, 2022, we had
As of June 30, 2023 and September 30, 2022, we had cash equivalents of
For the nine months ended June 30, 2023, our operating activities provided cash of
For the nine months ended June 30, 2022, our operating activities used cash of
During the three months ended June 30, 2023, we issued 5,805,484 shares of common stock through the ATM Program at an average price of
During the nine months ended June 30, 2023, we issued 5,891,661 shares of common stock through the ATM Program at an average price of
RECENT DEVELOPMENTS
Subsequent to June 30, 2023, we issued 3,197,403 shares of common stock through the ATM Program that were sold prior to the quarter end at an average price of
On July 31, 2023, the Credit Facility's commitment was increased by
DISTRIBUTIONS
During the three and nine months ended June 30, 2023, we declared distributions of
AVAILABLE INFORMATION
The Company makes available on its website its Quarterly Report on Form 10-Q filed with the SEC, and stockholders may find such report on its website at www.pennantpark.com.
PENNANTPARK FLOATING RATE CAPITAL LTD. AND SUBSIDIARIES | |||||||
CONSOLIDATED STATEMENTS OF ASSETS AND LIABILITIES | |||||||
(in thousands, except per share data) | |||||||
June 30, 2023 (Unaudited) | September 30, 2022 | ||||||
Assets | |||||||
Investments at fair value | |||||||
Non-controlled, non-affiliated investments (amortized cost— | $ | 814,608 | $ | 893,249 | |||
Controlled, affiliated investments (amortized cost— | 290,657 | 271,005 | |||||
Total investments (cost— | 1,105,265 | 1,164,254 | |||||
Cash and cash equivalents (cost— | 59,092 | 47,880 | |||||
Interest receivable | 10,005 | 7,543 | |||||
Receivable for investments sold | 7,352 | 3,441 | |||||
Distributions receivable | 692 | — | |||||
Prepaid expenses and other assets | 817 | 748 | |||||
Total assets | 1,183,223 | 1,223,866 | |||||
Liabilities | |||||||
Distributions payable | 5,499 | 4,308 | |||||
Credit Facility payable, at fair value (cost— | 63,917 | 167,563 | |||||
2023 Notes payable, at fair value (par— | 79,260 | 96,812 | |||||
2026 Notes payable, net (par— | 182,860 | 182,276 | |||||
2031 Asset-Backed Debt, net (par— | 226,601 | 226,128 | |||||
Interest payable on debt | 6,138 | 8,163 | |||||
Base management fee payable | 2,840 | 3,027 | |||||
Incentive fee payable | 4,625 | 3,164 | |||||
Deferred tax liability | 1,640 | 4,568 | |||||
Accounts payable and accrued expenses | 1,416 | 765 | |||||
Total liabilities | 574,796 | 696,774 | |||||
Net assets | |||||||
Common stock, 55,537,299 and 45,345,638 shares issued and outstanding, respectively | |||||||
Par value | 56 | 45 | |||||
Paid-in capital in excess of par value | 730,528 | 618,028 | |||||
Accumulated deficit | (122,157 | ) | (90,981 | ) | |||
Total net assets | $ | 608,427 | $ | 527,092 | |||
Total liabilities and net assets | $ | 1,183,223 | $ | 1,223,866 | |||
Net asset value per share | $ | 10.96 | $ | 11.62 |
PENNANTPARK FLOATING RATE CAPITAL LTD. AND SUBSIDIARIES | |||||||||||||||
CONSOLIDATED STATEMENTS OF OPERATIONS | |||||||||||||||
(in thousands, except per share data) | |||||||||||||||
Three Months Ended June 30, (Unaudited) | Nine Months Ended June 30, (Unaudited) | ||||||||||||||
2023 | 2022 | 2023 | 2022 | ||||||||||||
Investment income: | |||||||||||||||
From non-controlled, non-affiliated investments: | |||||||||||||||
Interest | $ | 21,988 | $ | 16,701 | $ | 65,440 | $ | 49,753 | |||||||
Dividend | 4,390 | 577 | 5,602 | 1,731 | |||||||||||
Other income | 734 | 285 | 1,460 | 3,795 | |||||||||||
From non-controlled, affiliated investments: | |||||||||||||||
Interest | — | — | — | 112 | |||||||||||
Other income | — | — | — | — | |||||||||||
From controlled, affiliated investments: | |||||||||||||||
Interest | 8,151 | 4,228 | 22,701 | 10,633 | |||||||||||
Dividend | 2,450 | 3,938 | 8,400 | 10,675 | |||||||||||
Other Income | — | — | — | — | |||||||||||
Total investment income | 37,713 | 25,729 | 103,603 | 76,699 | |||||||||||
Expenses: | |||||||||||||||
Base management fee | 2,840 | 3,062 | 8,643 | 8,904 | |||||||||||
Performance-based incentive fee | 4,625 | 2,576 | 12,245 | 8,461 | |||||||||||
Interest and expenses on debt | 9,985 | 7,369 | 29,595 | 20,713 | |||||||||||
Administrative services expenses | 477 | 144 | 764 | 431 | |||||||||||
General and administrative expenses | 1,134 | 655 | 2,545 | 1,964 | |||||||||||
Expenses before provision for taxes | 19,061 | 13,806 | 53,792 | 40,473 | |||||||||||
Provision for taxes on net investment income | 150 | 100 | 834 | 300 | |||||||||||
Total expenses | 19,211 | 13,906 | 54,626 | 40,773 | |||||||||||
Net investment income | 18,502 | 11,823 | 48,977 | 35,926 | |||||||||||
Realized and unrealized gain (loss) on investments and debt: | |||||||||||||||
Net realized gain (loss) on: | |||||||||||||||
Non-controlled, non-affiliated investments | (6,065 | ) | 701 | (13,520 | ) | 10,694 | |||||||||
Non-controlled and controlled, affiliated investments | — | — | — | (22,315 | ) | ||||||||||
Provision for taxes on realized gain on investments | — | — | (300 | ) | — | ||||||||||
Net realized gain (loss) on investments | (6,065 | ) | 701 | (13,820 | ) | (11,621 | ) | ||||||||
Net change in unrealized appreciation (depreciation) on: | |||||||||||||||
Non-controlled, non-affiliated investments | 3,051 | (11,204 | ) | (12,204 | ) | (12,243 | ) | ||||||||
Controlled and non-controlled, affiliated investments | (4,143 | ) | (6,431 | ) | (9,825 | ) | 8,597 | ||||||||
Provision for taxes on unrealized appreciation (depreciation) on investments | — | — | 2,929 | (5,340 | ) | ||||||||||
Debt (appreciation) depreciation | (5,752 | ) | 26 | (4,842 | ) | 1,273 | |||||||||
Net change in unrealized appreciation (depreciation) on investments and debt | (6,844 | ) | (17,609 | ) | (23,942 | ) | (7,713 | ) | |||||||
Net realized and unrealized gain (loss) from investments and debt | (12,909 | ) | (16,908 | ) | (37,762 | ) | (19,334 | ) | |||||||
Net increase (decrease) in net assets resulting from operations | 5,593 | (5,085 | ) | $ | 11,215 | 16,592 | |||||||||
Net increase (decrease) in net assets resulting from operations per common share | $ | 0.11 | $ | (0.12 | ) | $ | 0.23 | $ | 0.42 | ||||||
Net investment income per common share | $ | 0.36 | $ | 0.29 | $ | 1.02 | $ | 0.90 |
ABOUT PENNANTPARK FLOATING RATE CAPITAL LTD.
PennantPark Floating Rate Capital Ltd., or the Company, is a business development company that primarily invests in U.S. middle-market companies in the form of floating rate senior secured loans, including first lien secured debt, second lien secured debt and subordinated debt. From time to time, the Company may also invest in equity investments. PennantPark Floating Rate Capital Ltd. is managed by PennantPark Investment Advisers, LLC.
ABOUT PENNANTPARK INVESTMENT ADVISERS, LLC
PennantPark Investment Advisers, LLC is a leading middle-market credit platform, managing
FORWARD-LOOKING STATEMENTS
This press release may contain “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. You should understand that under Section 27A(b)(2)(B) of the Securities Act of 1933, as amended, and Section 21E(b)(2)(B) of the Securities Exchange Act of 1934, as amended ("the Exchange Act"), the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995 do not apply to forward-looking statements made in periodic reports PennantPark Floating Rate Capital Ltd. files under the Exchange Act. All statements other than statements of historical facts included in this press release are 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 from time to time in filings with the SEC. PennantPark Floating Rate Capital Ltd. undertakes no duty to update any forward-looking statement made herein. You should not place undue influence on such forward-looking statements as such statements speak only as of the date on which they are made.
We may use words such as “anticipates,” “believes,” “expects,” “intends,” “seeks,” “plans,” “estimates” and similar expressions to identify forward-looking statements. Such statements are based on currently available operating, financial and competitive information and are subject to various risks and uncertainties that could cause actual results to differ materially from our historical experience and our present expectations.
The information contained herein is based on current tax laws, which may change in the future. The Company cannot be held responsible for any direct or incidental loss resulting from applying any of the information provided in this publication or from any other source mentioned. The information provided in this material does not constitute any specific legal, tax or accounting advice. Please consult with qualified professionals for this type of advice.
CONTACT: | Richard T. Allorto, Jr. |
PennantPark Floating Rate Capital Ltd. | |
(212) 905-1000 | |
www.pennantpark.com |
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