Press Release
November 08, 2013

Apollo Investment Corporation Reports Financial Results for the Quarter Ended September 30, 2013

Apollo Investment Corporation Reports Financial Results for the Quarter Ended September 30, 2013

NEW YORK, NY -- (Marketwired) -- 11/08/13 -- Apollo Investment Corporation (NASDAQ: AINV)

Fiscal Second Quarter Highlights:

  • Net investment income per share for the quarter was $0.22, compared to $0.25 for the quarter ended June 30, 2013

  • Net asset value per share at the end of the quarter was $8.30, compared to $8.16 at June 30, 2013, a 2% increase

  • Declared a dividend of $0.20 per share for the quarter

  • Invested $412 million during the quarter, substantially driven by primary originations

  • Net investment activity was $(59) million for the quarter due to opportunistic exits

  • Amended revolving credit facility to extend maturity, improve pricing, and increase commitments

Apollo Investment Corporation (NASDAQ: AINV) or the "Company," or "Apollo Investment," today announced financial results for its second fiscal quarter ended September 30, 2013. The Company's net investment income was $0.22 per share for the quarter ended September 30, 2013, compared to $0.25 for the quarter ended June 30, 2013. The Company's net asset value ("NAV") was $8.30 per share as of September 30, 2013, up from $8.16 at June 30, 2013.

Additionally, the Company also announced that its Board of Directors has declared a dividend of $0.20 per share for the third fiscal quarter of 2014, payable on January 6, 2014 to stockholders of record as of December 19, 2013. The specific tax characteristics of this dividend will be reported to stockholders on Form 1099 after the end of the calendar year.

Mr. James Zelter, Apollo Investment Corporation's Chief Executive Officer, said, "For the September quarter, we reported healthy net investment income and a meaningful increase in net asset value. Given the strength in the credit markets throughout the period, we monetized select assets with minimal impact to the overall portfolio yield." Mr. Zelter continued, "We also continued to improve our capital structure by lowering the pricing, extending the maturity, and increasing the size of our revolving credit facility."

FINANCIAL HIGHLIGHTS FOR THE QUARTER ENDED SEPTEMBER 30, 2013
Select Balance Sheet Data
September 30, 2013 March 31, 2013
Total assets $3.14 billion $2.94 billion
Investment portfolio $3.03 billion $2.85 billion
Debt $1.08 billion $1.16 billion
Net assets $1.86 billion $1.68 billion
Net asset value per share $8.30 $8.27
Debt-to-equity 0.58 x 0.69 x
Leverage Ratio (1) 0.62 x 0.70 x

(1) The Company's leverage ratio is defined as debt outstanding plus payable for investments purchased and cash equivalents, plus due to custodian, less receivable for investments sold, less cash equivalents, less cash, less foreign currency, divided by total net assets.

Portfolio Activity (2) and Portfolio Companies
Three months ended
September 30, 2013
Six months ended
September 30, 2013
Investments made during the period $412 million $1,200 million
Investments sold $(284) million $(390) million
Net activity before repaid investments $127 million $810 million
Investments repaid $(186) million $(661) million
Net investment activity $(59) million $149 million
Portfolio companies, at beginning of period 94 81
New portfolio companies 12 35
Exited portfolio companies 13 23
Portfolio companies, at end of period 93 93

(2) Numbers may not sum due to rounding.

Operating Results
Three months ended
September 30, 2013
Six months ended
September 30, 2013
(in thousands)
Net investment income $49,586 $101,953
Net realized and unrealized loss $26,839 $(6,724)
Net increase in net assets from operations $76,425 $95,229
(per share)
Net investment income per share $0.22 $0.47
Net realized and unrealized loss per share $0.12 $(0.04)
Earnings per share - basic $0.34 $0.43
Earnings per share - diluted $0.33 $0.43

CONFERENCE CALL / WEBCAST AT 10:00 AM EST ON November 8, 2013

The Company will host a conference call on Friday, November 8, 2013 at 10:00 a.m. Eastern Time. All interested parties are welcome to participate in the conference call by dialing (888) 802-8579 approximately 5-10 minutes prior to the call; international callers should dial (973) 633-6740. Participants should reference Apollo Investment Corporation or Conference ID # 83833351 when prompted. A simultaneous webcast of the conference call will be available to the public on a listen-only basis and can be accessed through the Event Calendar in the Investor Relations section of our website at www.apolloic.com. Following the call you may access a replay of the event either telephonically or via audio webcast. The telephonic replay will be available approximately two hours after the live call and through November 22, 2013 by dialing (800) 585-8367; international callers please dial (404) 537-3406, reference Conference ID # 83833351. A replay of the audio webcast will also be available later that same day. To access the audio webcast please visit the Event Calendar in the Investor Relations section of our website at www.apolloic.com.

SUPPLEMENTAL INFORMATION

The Company provides a supplemental information package to offer more transparency into its financial results and make its reporting more informative and easier to follow. The supplemental package is available in the investor relations section of the Company's website at www.apolloic.com.

PORTFOLIO AND INVESTMENT ACTIVITY

During the three months ended September 30, 2013, we invested $412 million across 12 new and 18 existing portfolio companies, through a combination of primary and secondary market purchases. This compares to investing $395 million in 13 new and 11 existing portfolio companies for the three months ended September 30, 2012. Investments sold or repaid during the three months ended September 30, 2013 totaled $470 million versus $343 million for the three months ended September 30, 2012.

At September 30, 2013, our portfolio consisted of 93 portfolio companies and was invested 52% in secured debt, 34% in unsecured debt, 6% in structured products and other and 8% in common equity, preferred equity and warrants measured at fair value versus 81 portfolio companies invested 44% in secured debt, 43% in unsecured debt, 7% in structured products and other and 6% in common equity, preferred equity and warrants, measured at fair value at March 31, 2013.

The weighted average yields on our secured debt portfolio, unsecured debt portfolio, and total debt portfolio as of September 30, 2013 at our current cost basis were 11.1%, 11.7%, and 11.3%, respectively, exclusive of securities on non-accrual status. The weighted average yields on our secured loan portfolio, unsecured debt portfolio, and total debt portfolio as of March 31, 2013 at the current cost basis were 11.2%, 12.7%, and 11.9%, respectively, exclusive of securities on non-accrual status.

Since the initial public offering of Apollo Investment in April 2004, and through September 30, 2013, invested capital totaled $11.5 billion in 250 portfolio companies. Over the same period, Apollo Investment completed transactions with more than 100 different financial sponsors.

At September 30, 2013, 62% or $1.7 billion of our income-bearing investment portfolio was fixed rate and 38% or $1.0 billion was floating rate, measured at fair value. On a cost basis, 63% or $1.7 billion of our income-bearing investment portfolio was fixed rate and 37% or $1.0 billion is floating rate. At March 31, 2013, 64% or $1.6 billion of our income-bearing debt investment portfolio was fixed rate debt and 36% or $0.9 billion was floating rate debt, measured at fair value. On a cost basis, 65% or $1.6 billion of our income-bearing investment portfolio was fixed rate debt and 35% or $0.9 billion was floating rate debt.