Gladstone Investment Corporation Reports Financial Results for the Fiscal Year and Quarter Ended March 31, 2007
-- Net Investment Income for the year was $11.2 million, or $0.67 per common share and for the quarter ended March 31, 2007 was $2.8 million, or $0.17 per common share
-- Net Increase in Net Assets From Operations for the year was $7.3 million, or $0.44 per common share and for the quarter ended March 31, 2007 was $0.5 million, or $0.03 per common share
MCLEAN, Va.--(BUSINESS WIRE)--
Gladstone Investment Corp. (NASDAQ: GAIN) (the "Company") today announced earnings for the fourth quarter and fiscal year ended March 31, 2007. All per share references are per basic and diluted weighted average common share outstanding, unless otherwise noted.
Net Investment Income for the year ended March 31, 2007 was $11,147,732, or $0.67 per share compared to Net Investment Income for the period June 22, 2005 (commencement of operations) to March 31, 2006 of $5,883,898, or $0.36 per share. For the three months ended March 31, 2007 Net Investment Income was $2,784,614, or $0.17 per share compared to $2,698,622, or $0.16 per share for the same period a year ago.
Net Increase in Net Assets Resulting from Operations for the year ended March 31, 2007 was $7,268,404, or $0.44 per share compared to $6,054,297, or $0.37 per share for the period ended June 22, 2005 (commencement of operations) to March 31, 2006. The Net Increase in Net Assets Resulting from Operations for the three months ended March 31, 2007 was $458,769, or $0.03 per share compared to $2,943,018, or $0.18 per share for the three months ended March 31, 2006.
Total assets were $323,590,215 at March 31, 2007 as compared to $230,323,807 at March 31, 2006. Net asset value was $13.46 per actual common share outstanding at March 31, 2007 as compared to $13.88 per actual common share outstanding at March 31, 2006.
The weighted average yield on our portfolio of investments, excluding cash and cash equivalents, was 8.72% for the year ended March 31, 2007 compared to 7.02% for the period from June 22, 2005 (commencement of operations) to March 31, 2006. The annualized weighted average yield on the Company's portfolio for the three months ended March 31, 2007 was 8.72% compared to 7.41% for the three months ended March 31, 2006.
During the fourth quarter ended March 31, 2007, the Company recorded the following activity:
-- Invested approximately $36.0 million in senior debt,
subordinated debt and preferred and common equity with A.
Stucki Company;
-- Acquired interests in five new syndicated loans for
approximately $9.4 million;
-- Acquired interests in nine existing syndicated loan
participations for approximately $18.2 million;
-- Sold or received full repayment for $26.9 million of four
syndicated loan participations; and
-- Increased its borrowing capacity under its revolving credit
facility with Deutsche Bank A.G. from $100 million to $200
million.
At March 31, 2007, the Company held 41 non-control/non-affiliate investments, 5 control investments and 1 affiliate investment, totaling an aggregate cost basis of approximately $275 million and a fair value of approximately $271 million.
Condensed Schedule of Investments
March 31, 2007
Investment Type Cost Fair Value
----------------------------------------------------------------------
Total Non-control/Non-Affiliate
Investments $138,567,741 $138,168,612
Total Control Investments 116,302,372 113,016,491
Total Affiliate Investments 19,750,000 19,762,500
------------- -------------
Total Investments $274,620,113 $270,947,603
============= =============
"Since the inception of our fund in June 2005, we have invested over $390 million, resulting in the full investment of our IPO proceeds and an additional $200 million in debt financing. We continue to add proprietary investments to our portfolio using leverage, thereby increasing returns to stockholders. We continue to see good opportunities for our company and expect to close more investments as the year progresses," said Chip Stelljes, President and Chief Investment Officer.
Subsequent to March 31, 2007, the Company:
-- Purchased additional syndicated loan participations of 8 new
and 9 existing portfolio companies of approximately $48.6
million;
-- Received the full repayment on 3 of its syndicated loan
participations for approximately $13.6 million and sold 2 of
its syndicated loan participations totaling approximately $3.4
million, realizing an aggregate net loss of approximately
$30,000 on the transactions;
-- Invested approximately $7.2 million in one buyout investment;
and
-- Declared monthly cash dividends of $0.075 per common share for
each of the months of April, May and June of 2007.
The Company will hold a conference call on Friday, June 1, 2007 at 8:30 am EDT to discuss fourth quarter and fiscal year earnings. Please call (877) 407-8031 to enter the conference. An operator will monitor the call and set a queue for the questions.
A replay of the conference call will be available through August 2, 2007. To hear the replay, please dial (877) 660-6853, access playback account 286 and use ID code 243279. The replay will be available approximately two hours after the call concludes.
The live audio broadcast of Gladstone Investment's quarterly conference call will be available online at www.GladstoneInvestment.com and www.investorcalendar.com. The online replay will follow shortly after the call and will be available through August 2, 2007.
Gladstone Investment Corporation is an investment company that seeks to make debt and equity investments in small and mid-sized private businesses in the U.S. in connection with acquisitions, changes in control and recapitalizations. For more information please visit our website at http://www.GladstoneInvestment.com.
This press release may include statements that may constitute "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, including statements with regard to the future performance of the Company. Words such as "believes," "expects," "anticipates," "estimated," "approximately" "projects" and "future" or similar expressions are intended to identify forward-looking statements. These forward-looking statements inherently involve certain risks and uncertainties, although they are based on the Company's current plans that are believed to be reasonable as of the date of this press release. Factors that may cause the Company's actual results, levels of activity, performance or achievements to be materially different from any future results, levels of activity, performance or achievements expressed or implied by such forward-looking statements include, among others, those factors listed under the caption "Risk factors" of the Company's Form 10-K for the fiscal year ended March 31, 2007, as filed with the Securities and Exchange Commission on May 31, 2007. The Company undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.
GLADSTONE INVESTMENT CORPORATION
CONSOLIDATED STATEMENTS OF OPERATIONS
(UNAUDITED)
For the three For the three
months ended months ended
March 31, 2007 March 31, 2006
--------------- ----------------
INVESTMENT INCOME
Interest income
Non-Control/Non-Affiliate
investments $ 2,634,567 $ 1,466,449
Control investments 1,775,004 255,059
Affiliate investments 420,961 -
Cash and cash equivalents 51,141 1,242,687
--------------- ----------------
Total interest income 4,881,673 2,964,195
Fee Income - Control Investments - 230,000
Other income 3,229 185
--------------- ----------------
Total investment income 4,884,902 3,194,380
--------------- ----------------
EXPENSES
Base management fee 198,679 557,730
Loan servicing fee 1,060,163 -
Administration fee 162,244 110,002
Directors fees 53,800 57,000
Professional fees 231,703 27,497
Insurance expense 61,406 72,612
Stockholder related costs 85,974 21,662
Interest expense 538,913 -
Amortization of deferred finance
costs 142,387 -
Taxes and licenses 28,879 188,684
Other expenses 38,498 15,160
--------------- ----------------
Expenses before credit from
Adviser 2,602,646 1,050,347
--------------- ----------------
Credit to base management fee for
fees collected by Adviser (502,358) (554,589)
--------------- ----------------
Total expenses net of credit to
management fee 2,100,288 495,758
--------------- ----------------
NET INVESTMENT INCOME 2,784,614 2,698,622
--------------- ----------------
REALIZED AND UNREALIZED LOSS ON
INVESTMENTS
Realized (loss) gain on sale of
Non-Control/Non-Affiliate
investments (92,906) 19,375
Net unrealized appreciation of
Non-Control/Non-Affiliate
investments 627,501 275,021
Net unrealized depreciation of
Control Investments (2,872,940) (50,000)
Net unrealized appreciation of
Affiliate Investments 12,500 -
--------------- ----------------
Net loss on investments (2,325,845) 244,396
--------------- ----------------
NET INCREASE IN NET ASSETS RESULTING
FROM OPERATIONS $ 458,769 $ 2,943,018
=============== ================
NET INCREASE IN NET ASSETS RESULTING
FROM OPERATIONS PER COMMON SHARE:
Basic and Diluted $ 0.03 $ 0.18
=============== ================
SHARES OF COMMON STOCK OUTSTANDING:
Basic and diluted weighted
average shares 16,560,100 16,560,100
GLADSTONE INVESTMENT CORPORATION
CONSOLIDATED STATEMENTS OF OPERATIONS
For the period
June 22, 2005
(Commencement of
Year Ended Operations) to
March 31, 2007 March 31, 2006
---------------- -----------------
INVESTMENT INCOME
Interest income
Non-Control/Non-Affiliate
investments $ 9,572,593 $ 2,450,906
Control investments 5,486,060 255,059
Affiliate investments 535,629 -
Cash and cash equivalents 1,661,647 4,434,706
---------------- -----------------
Total interest income 17,255,929 7,140,671
Fee income - Control investments - 230,000
Other income 5,707 185
---------------- -----------------
Total investment income 17,261,636 7,370,856
---------------- -----------------
EXPENSES
Base management fee 2,413,116 915,360
Loan servicing fee 1,568,854 -
Administration fee 526,595 288,471
Interest expense 607,661 378
Amortization of deferred finance
costs 233,779 -
Professional fees 586,028 163,369
Stockholder related costs 273,483 89,563
Insurance expense 262,339 184,642
Directors fees 208,100 160,000
Taxes and licenses 168,873 195,270
Organizational costs - 7,002
General and administrative
expenses 142,659 37,492
---------------- -----------------
Expenses before credit from
Adviser 6,991,487 2,041,547
---------------- -----------------
Credit to management fee for fees
collected by Adviser (877,583) (554,589)
---------------- -----------------
Total expenses net of credit
to management fee 6,113,904 1,486,958
---------------- -----------------
NET INVESTMENT INCOME 11,147,732 5,883,898
---------------- -----------------
REALIZED AND UNREALIZED GAIN (LOSS)
ON INVESTMENTS
Realized (loss) gain on sale of
Non-Control/Non-Affiliate
investments (93,850) 57,431
Net unrealized (depreciation)
appreciation of Non-
Control/Non-Affiliate
investments (562,097) 162,968
Net unrealized depreciation of
Control Investments (3,235,881) (50,000)
Net unrealized appreciation of
Affiliate Investments 12,500 -
---------------- -----------------
Net (loss) gain on
investments (3,879,328) 170,399
---------------- -----------------
NET INCREASE IN NET ASSETS
RESULTING FROM OPERATIONS $ 7,268,404 $ 6,054,297
================ =================
NET INCREASE IN NET ASSETS
RESULTING FROM OPERATIONS PER
COMMON SHARE:
Basic and Diluted $ 0.44 $ 0.37
================ =================
SHARES OF COMMON STOCK OUTSTANDING:
Basic and diluted weighted
average shares 16,560,100 16,391,589
GLADSTONE INVESTMENT CORPORATION
CONSOLIDATED STATEMENTS OF ASSETS AND LIABILITIES
March 31, 2007 March 31, 2006
ASSETS
Non-Control/Non-Affiliate investments
(Cost 3/31/07:$138,567,741; 3/31/06:
$97,423,004) $138,168,612 $ 97,585,972
Control investments (Cost 3/31/07:
$116,302,372; 3/31/06: $55,846,318) 113,016,491 55,796,318
Affiliate investments (Cost 3/31/07:
$19,750,000) 19,762,500 -
-------------- --------------
Total investments at fair value (Cost
3/31/07: $274,620,113; 3/31/06:
$153,269,322) 270,947,603 153,382,290
Cash and cash equivalents 37,788,941 75,672,605
Interest receivable 1,306,090 761,388
Prepaid insurance 83,819 99,874
Deferred finance costs 627,960 -
Due from Custodian 12,694,985 -
Due from Adviser 20,383 234,551
Other assets 120,434 173,099
-------------- --------------
TOTAL ASSETS $323,590,215 $230,323,807
============== ==============
LIABILITIES
Due to Administrator $ 162,244 $ 110,002
Borrowings under line of credit 100,000,000 -
Accrued expenses 523,698 367,031
Other liabilities 85,764 5,077
-------------- --------------
Total Liabilities 100,771,706 482,110
-------------- --------------
NET ASSETS $222,818,509 $229,841,697
============== ==============
ANALYSIS OF NET ASSETS:
Common stock, $0.001 par value,
100,000,000 shares authorized and
16,560,100 issued and outstanding,
respectively $ 16,560 $ 16,560
Capital in excess of par value 230,096,572 230,229,279
Net unrealized (depreciation)
appreciation of investment portfolio (3,672,510) 112,968
Distributions in excess of net
investment income (3,622,113) (517,110)
-------------- --------------
Total Net Assets $222,818,509 $229,841,697
============== ==============
Net assets per share $ 13.46 $ 13.88
============== ==============
GLADSTONE INVESTMENT CORPORATION
FINANCIAL HIGHLIGHTS
(UNAUDITED)
For the three For the three
months ended months ended
March 31, 2007 March 31, 2006
--------------- ---------------
Per Share Data (1)
--------------------------------------
Balance at beginning of period $ 13.65 $ 13.91
Income from investment operations:
Net investment income (2) 0.17 0.17
Realized loss on sale of investments
(2) (0.01) -
Net unrealized (depreciation)
appreciation of investments (2) (0.13) 0.01
--------------- ---------------
Total from investment operations 0.03 0.18
--------------- ---------------
Distributions (0.22) (0.21)
--------------- ---------------
Net asset value at end of period $ 13.46 $ 13.88
=============== ===============
Per share market value at beginning of
period $ 15.31 $ 13.59
Per share market value at end of
period 14.87 15.10
Total return (3) -1.41% 12.68%
Shares outstanding at end of period 16,560,100 16,560,100
Ratios/Supplemental Data
--------------------------------------
Net assets at end of period $222,818,509 $229,841,697
Average net assets (4) $223,372,272 $229,400,219
Ratio of expenses to average net
assets (annualized) (5) 4.66% 1.83%
Ratio of net expenses to average net
assets (annualized) (6) 3.76% 0.86%
Ratio of net investment income to
average net assets (annualized) 4.99% 4.71%
(1) Based on actual shares outstanding.
(2) Based on weighted average basic per share data.
(3) Total return equals the change in the market value of the Company's common stock from the beginning of the period taking into account dividends reinvested in accordance with the terms of our dividend reinvestment plan.
(4) Calculated using the average of the ending monthly net assets for the respective periods.
(5) Ratio of expenses to average net assets is computed using expenses before credit from the Adviser.
(6) Ratio of net expenses to average net assets is computed using total expenses net of credits to management fee.
GLADSTONE INVESTMENT CORPORATION
FINANCIAL HIGHLIGHTS
For the period
June 22, 2005
(Commencement of
For the year ended Operations) to
March 31, 2007 March 31, 2006
------------------ -----------------
Per Share Data (1)
---------------------------------
Balance at beginning of period $ 13.88 $ -
Net proceeds from initial
public offering (2) - 13.95
------------------ -----------------
Offering costs - (0.05)
Income from investment
operations:
Net investment income (3) 0.67 0.36
Realized loss on sale of
investments (3) (0.01) -
Net unrealized (depreciation)
appreciation of investments
(3) (0.23) 0.01
------------------ -----------------
Total from investment
operations 0.44 0.37
------------------ -----------------
Distributions (0.85) (0.39)
Shelf registration offering
costs (0.01) -
------------------ -----------------
Net asset value at end of
period $ 13.46 $ 13.88
================== =================
Per share market value at
beginning of period $ 15.10 $ 15.00
Per share market value at end
of period 14.87 15.10
Total Return (4) 4.36% 3.39%
Shares outstanding at end of
period 16,560,100 16,560,100
Ratios/Supplemental Data
---------------------------------
Net assets at end of period $222,818,509 $229,841,697
Average net assets $225,642,593 $226,875,738
Ratio of expenses to average net
assets (5) (6) 3.10% 1.08%
Ratio of net expenses to average
net assets (5) (7) 2.71% 0.79%
Ratio of net investment income to
average net assets (5) 4.94% 3.11%
(1) Based on actual shares outstanding.
(2) Net of initial underwriting discount of $1.05 per share.
(3) Based on weighted average basic per share data.
(4) Total return equals the change in the market value of the Company's common stock from the beginning of the period taking into account dividends reinvested in accordance with the terms of the Company's dividend reinvestment plan.
(5) Amounts are annualized for the period June 22, 2005 (commencement of operations) to March 31, 2006.
(6) Ratio of expenses to average net assets is computed using expenses before credit from the Adviser.
(7) Ratio of net expenses to average net assets is computed using total expenses net of credits to management fee.
Source: Gladstone Investment Corp.
Released May 31, 2007