{"id":720,"date":"2019-01-11T20:02:35","date_gmt":"2019-01-11T20:02:35","guid":{"rendered":"http:\/\/henristeenkamp.com\/?p=720"},"modified":"2019-05-06T19:34:14","modified_gmt":"2019-05-06T19:34:14","slug":"saratoga-investment-corp-announces-fiscal-third-quarter-2019-financial-results","status":"publish","type":"post","link":"https:\/\/ragnarok-ms.us\/henristeenkamp-com\/saratoga-investment-corp-announces-fiscal-third-quarter-2019-financial-results\/","title":{"rendered":"Saratoga Investment Corp. Announces Fiscal Third Quarter 2019 Financial Results"},"content":{"rendered":"

Jan 9, 2019<\/span><\/p>\n

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Saratoga Investment Corp. Announces Fiscal Third Quarter 2019 Financial Results<\/div>\n<\/div>\n
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NEW YORK,\u00a0Jan. 09, 2019\u00a0(GLOBE NEWSWIRE) —\u00a0Saratoga Investment Corp.\u00a0(NYSE:SAR) (\u201cSaratoga Investment\u201d or \u201cthe Company\u201d), a business development company, today announced financial results for its 2019 fiscal third quarter.<\/p>\n

Summary Financial Information<\/p>\n

The Company\u2019s summarized financial information is as follows:<\/p>\n

\"Screen<\/a><\/p>\n

\u201cOur third fiscal quarter of 2019 continued the growth of our high quality asset base and sustained industry leadership in key performance metrics,\u201d said\u00a0Christian L. Oberbeck, Chairman and Chief Executive Officer of\u00a0Saratoga Investment. \u201cThis quarter reflects the full impact of July\u2019s\u00a0$28.75 million\u00a0equity offering and August\u2019s new\u00a0$40.0 million\u00a0baby bonds issuance, all of which was deployed by the end of this quarter. This has contributed to the increased interest income generated this quarter. We also again increased our dividend for the seventeenth consecutive quarter, a\u00a0$0.01\u00a0increase to\u00a0$0.53\u00a0per share, while continuing to over-earn our dividend by 23% as compared to this quarter\u2019s adjusted NII per share. We remain well-structured for rising rates, with 83% of our interest earning investments having floating-rates and through their LIBOR floors, and all of our debt, except for our Madison credit facility, being fixed-rate. And subsequent to quarter-end, we successfully refinanced our CLO and upsized it to\u00a0$500 million\u00a0of assets, with a corresponding increase to interest and management fee income.\u201d<\/p>\n

Michael J. Grisius, President and Chief Investment Officer, added, \u201cDuring this fiscal quarter, we were able to originate a healthy\u00a0$73.7 millionof investments and grow our assets under management by 13%, without sacrificing the strength and the quality of the credits in our portfolio. The fact that we\u2019ve been able to consistently accomplish this underscores the continued growth of our sourcing pipeline, and the strength of our originations team and their investment judgement. We have added eight new portfolio companies since May this year. We remain confident that sticking to our long-term strategy of identifying and underwriting high quality credits will continue to garner positive results.\u201d<\/p>\n

As of\u00a0November 30, 2018,\u00a0Saratoga Investment\u00a0increased its assets under management (\u201cAUM\u201d) to\u00a0$443.8 million, an increase of 13.0% from\u00a0$392.9 million\u00a0as of\u00a0August 31, 2018, and an increase of 31.0% from\u00a0$338.8 million\u00a0as of\u00a0November 30, 2017. The increase this quarter reflects originations of\u00a0$73.7 million, offset by amortizations and repayments of\u00a0$23.4 million. Saratoga Investment\u2019s portfolio has grown this quarter and credit quality remains strong, with a continued high level of investment quality in loan investments, with 98.6% of the loans this quarter at Saratoga Investment\u2019s highest internal rating. Included in this quarter\u2019s originations is also an investment in one new portfolio company. Since Saratoga management has taken over the management of the BDC,\u00a0$299.1 million\u00a0of repayments and sales of investments originated by Saratoga have generated a gross unlevered IRR of 13.4%.<\/p>\n

For the three months ended\u00a0November 30, 2018, total investment income of\u00a0$12.8 million\u00a0increased\u00a0$3.3 million, or 34.7%, compared to\u00a0$9.5 million\u00a0for the three months ended\u00a0November 30, 2017. This increased investment income was generated from an investment base that has grown by 31.0% since last year. The weighted average current coupon on all investments decreased slightly to 10.8%, primarily due to an increase in equity positions on which there is generally no interest income, which increased to 8.7% of the total portfolio from 8.4% last year. In addition, this quarter\u2019s investment income was up 12.5% on a quarter-over-quarter basis from\u00a0$11.4 million\u00a0for the quarter ended\u00a0August 31, 2018.<\/p>\n

As compared to the three months ended\u00a0November 30, 2017, the investment income increase was offset by (i) increased debt and financing expenses, as the growth in AUM this year was partially financed from increased SBA debentures and the recently issued\u00a0$40.0 million\u00a0baby bond issuance, and (ii) increased base management fees generated from the management of this larger pool of investments.<\/p>\n

Net investment income on a weighted average per share basis was\u00a0$0.69\u00a0for the quarter ended\u00a0November 30, 2018. Adjusted for the incentive fee accrual related to net unrealized capital gains, the net investment income on a weighted average per share basis was\u00a0$0.65. This compares to adjusted net investment income per share of\u00a0$0.69\u00a0for the quarter ended\u00a0August 31, 2018\u00a0and\u00a0$0.54\u00a0for the quarter ended\u00a0November 30, 2017, reflecting a quarter-on-quarter decrease of\u00a0$0.04\u00a0and a year-on-year increase of\u00a0$0.11.<\/p>\n

Net investment income yield as a percentage of average net asset value (\u201cNet Investment Income Yield\u201d) was 11.9% for the quarter ended\u00a0November 30, 2018. Adjusted for the incentive fee accrual related to net unrealized capital gains, the Net Investment Income Yield was 11.2%. In comparison, adjusted Net Investment Income Yield was 11.9% and 9.6% for the quarters ended\u00a0August 31, 2018\u00a0and\u00a0November 30, 2017, respectively.<\/p>\n

Net Asset Value (\u201cNAV\u201d) was\u00a0$173.3 million\u00a0as of\u00a0November 30, 2018, an increase of\u00a0$29.6 million\u00a0from\u00a0$143.7 million\u00a0as of\u00a0February 28, 2018, and an increase of\u00a0$34.5 million\u00a0from\u00a0$138.8 million\u00a0as of\u00a0November 30, 2017.<\/p>\n