ARES CAPITAL CORPORATION Third Quarter 2022
Earnings Presentation
Important Notice
This presentation contains "forward looking statementsˮ within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended, that are subject to risks and uncertainties, including the impact of rising interest rates in response to inflation, the war in Russia and Ukraine and the ongoing coronavirus ("COVID-19ˮ) pandemic, which have resulted in significant market volatility impacting our business, our portfolio companies, our industry and the global economy. Actual outcomes and results could differ materially from those suggested by this presentation due to the impact of many factors beyond the control of Ares Capital Corporation ("Ares Capitalˮ), including those listed in the "Risk Factorsˮ section of our filings with the Securities and Exchange Commission ("SECˮ). Any such forward-looking statements are made pursuant to the safe harbor provisions available under applicable securities laws and Ares Capital assumes no obligation to update or revise any such forward-looking statements.
Certain information discussed in this presentation (including information relating to portfolio companies) was derived from third party sources and has not been independently verified and, accordingly, Ares Capital makes no representation or warranty in respect of this information.
The following slides contain summaries of certain financial and statistical information about Ares Capital. The information contained in this presentation is summary information that is intended to be considered in the context of our SEC filings and other public announcements that we may make, by press release or otherwise, from time to time. We undertake no duty or obligation to publicly update or revise the information contained in this presentation. In addition, information related to past performance, while helpful as an evaluative tool, is not necessarily indicative of future results, the achievement of which cannot be assured. You should not view the past performance of Ares Capital, or information about the market, as indicative of Ares Capital's future results. This presentation does not constitute an offer to sell or the solicitation of an offer to buy any securities of Ares Capital.
2
Financial and Portfolio Highlights
Financial Highlights | ||||||
Q3-22 | Q2-22 | Q3-21 | ||||
Core EPS*(1) | $ | 0.50 | $ | 0.46 | $ | 0.47 |
Net Investment Income Per Share(2) | $ | 0.57 | $ | 0.52 | $ | 0.40 |
Net Realized Gains (Losses) Per Share(2) | $ | - | $ | (0.01) | $ | 0.33 |
Net Unrealized Gains (Losses) Per Share(2) | $ | (0.36) | $ | (0.29) | $ | - |
GAAP Net Income Per Share(2)(3) | $ | 0.21 | $ | 0.22 | $ | 0.73 |
Net Asset Value Per Share | $ | 18.56 | $ | 18.81 | $ | 18.52 |
Portfolio Highlights | ||||||
(dollar amounts in millions) | Q3-22 | Q2-22 | Q3-21 | |||
Gross Commitments(4) | $ | 2,242 | $ | 3,109 | $ | 3,110 |
Exits of Commitments(5) | $ | 1,996 | $ | 1,085 | $ | 2,263 |
Total Fair Value of Investments | $ | 21,339 | $ | 21,170 | $ | 17,677 |
Weighted Average Yield on Debt and Other Income Producing Securities at Amortized Cost(6) | 10.7 % | 9.5 % | 8.6 % | |||
Weighted Average Yield on Total Investments at Amortized Cost(7) | 9.6 % | 8.7 % | 7.7 % |
Note: Endnotes begin on slide 24
* See slide 23 hereof for reconciliations of Core EPS to basic GAAP net income per share, the most directly comparable GAAP financial measure.
3
Selected Historical Financial Information
As of and for the Three Months Ended | ||||||||||
(dollar amounts in millions, except per share data and stock prices) | 9/30/22 | 6/30/22 | 3/31/22 | 12/31/21 | 9/30/21 | |||||
Core EPS*(1) | $ | 0.50 | $ | 0.46 | $ | 0.42 | $ | 0.58 | $ | 0.47 |
Net Investment Income Per Share(2) | $ | 0.57 | $ | 0.52 | $ | 0.41 | $ | 0.52 | $ | 0.40 |
Net Realized and Unrealized Gains (Losses) Per Share(2) | $ | (0.36) | $ | (0.30) | $ | 0.03 | $ | 0.31 | $ | 0.33 |
GAAP Net Income Per Share(2)(3) | $ | 0.21 | $ | 0.22 | $ | 0.44 | $ | 0.83 | $ | 0.73 |
Dividend Declared and Payable Per Share | $ | 0.43 | $ | 0.42 | $ | 0.42 | $ | 0.41 | $ | 0.41 |
Additional Dividend Declared and Payable Per Share | $ | 0.03 | $ | 0.03 | $ | 0.03 | $ | - | $ | - |
Stockholders' Equity | $ | 9,436 | $ | 9,335 | $ | 9,379 | $ | 8,868 | $ | 8,537 |
Net Asset Value Per Share | $ | 18.56 | $ | 18.81 | $ | 19.03 | $ | 18.96 | $ | 18.52 |
Debt/Equity Ratio | 1.27x | 1.27x | 1.13x | 1.26x | 1.17x | |||||
Debt/Equity Ratio, Net of Available Cash(8) | 1.24x | 1.25x | 1.06x | 1.21x | 1.04x | |||||
Unsecured Debt to Total Debt | 71.7 % | 72.3 % | 80.4 % | 75.9 % | 83.5 % | |||||
Weighted Average Stated Interest on Debt(9) | 3.8 % | 3.5 % | 3.2 % | 3.1 % | 3.2 % | |||||
Net Interest and Dividend Margin(10) | 6.6 % | 6.4 % | 6.4 % | 6.4 % | 6.5 % | |||||
Ratio of Earnings to Fixed Charges(11) | 3.2 | 3.4 | 3.3 | 3.7 | 3.3 | |||||
Market Capitalization | ||||||||||
Principal Debt | $ | 11,853 | $ | 11,768 | $ | 10,570 | $ | 11,061 | $ | 9,928 |
Equity | 8,579 | 8,898 | 10,324 | 9,910 | 9,367 | |||||
Total Market Capitalization | $ | 20,432 | $ | 20,666 | $ | 20,894 | $ | 20,971 | $ | 19,295 |
Common Stock Data: | ||||||||||
High Price during the period | $ | 20.70 | $ | 22.44 | $ | 22.58 | $ | 21.70 | $ | 20.43 |
Low Price during the period | $ | 16.84 | $ | 17.12 | $ | 19.70 | $ | 19.66 | $ | 19.52 |
Closing Price | $ | 16.88 | $ | 17.93 | $ | 20.95 | $ | 21.19 | $ | 20.33 |
*See slide 23 hereof for reconciliations of Core EPS to basic GAAP net income per share, the most directly comparable GAAP financial measure.
4
Selected Historical Financial Information (cont'd)
As of | ||||||||||
(dollar amounts in millions) | 9/30/22 | 6/30/22 | 3/31/22 | 12/31/21 | 9/30/21 | |||||
Investments at Fair Value | $ | 21,339 | $ | 21,170 | $ | 19,486 | $ | 20,009 | $ | 17,677 |
Number of Portfolio Companies(12) | 458 | 452 | 395 | 387 | 371 | |||||
Asset Class (at fair value): | ||||||||||
First Lien Senior Secured Loans(13) | 45 % | 45 % | 45 % | 47 % | 49 % | |||||
Second Lien Senior Secured Loans | 18 % | 19 % | 21 % | 23 % | 23 % | |||||
Senior Direct Lending Program(14) | 5 % | 5 % | 5 % | 5 % | 5 % | |||||
Senior Subordinated Loans | 5 % | 5 % | 5 % | 4 % | 6 % | |||||
Preferred Equity | 10 % | 9 % | 9 % | 8 % | 7 % | |||||
Ivy Hill Asset Management(15) | 9 % | 9 % | 7 % | 5 % | 3 % | |||||
Other Equity | 8 % | 8 % | 8 % | 8 % | 7 % | |||||
Interest Rate Type (at fair value) | ||||||||||
% Floating Rate(16) | 73 % | 74 % | 74 % | 77 % | 80 % | |||||
% Fixed Rate | 10 % | 10 % | 10 % | 10 % | 9 % | |||||
% Non-Income Producing | 10 % | 10 % | 10 % | 8 % | 8 % | |||||
% Ivy Hill Asset Management Equity* | 7 % | 6 % | 6 % | 5 % | 3 % | |||||
Yields: | ||||||||||
Weighted Avg. Yield on Debt and Other Income Producing | 10.7 % | 9.5 % | 8.9 % | 8.7 % | 8.9 % | |||||
Securities at Amortized Cost(6) | ||||||||||
Weighted Avg. Yield on Debt and Other Income Producing | 10.8 % | 9.6 % | 8.8 % | 8.7 % | 8.9 % | |||||
Securities at Fair Value(6) | ||||||||||
Weighted Average Yield on Total Investments at Amortized | 9.6 % | 8.7 % | 8.1 % | 7.9 % | 8.2 % | |||||
Cost(7) | ||||||||||
Weighted Average Yield on Total Investments at Fair | 9.7 % | 8.6 % | 8.0 % | 7.9 % | 8.2 % | |||||
Value(7) |
*Ares Capital's equity investment in Ivy Hill Asset Management, L.P. ("IHAM") generally pays a quarterly dividend.
5
This is an excerpt of the original content. To continue reading it, access the original document here.
Attachments
- Original Link
- Original Document
- Permalink
Disclaimer
Ares Capital Corporation published this content on 25 October 2022 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 25 October 2022 11:13:01 UTC.
