Press Release
August 05, 2016

Apollo Investment Corporation Reports Financial Results for the Quarter Ended June 30, 2016

Apollo Investment Corporation Reports Financial Results for the Quarter Ended June 30, 2016

Fiscal First Quarter and Other Recent Highlights:

  • Net investment income per share for the quarter was $0.17, excluding $0.01 per share of non-recurring expenses(1), compared to $0.20 for the quarter ended March 31, 2016
  • Net asset value per share as of the end of the quarter was $6.90 compared to $7.28 as of March 31, 2016, a 5.2% decline
  • Declared a dividend of $0.15 per share for the quarter
  • Net leverage as of the end of the quarter was 0.66 x, compared to 0.75 x(2) as of March 31, 2016
  • Oil and gas exposure reduced to less than 10% of the portfolio, at fair value, subsequent to quarter end
  • Repurchased 1.1 million shares of common stock for an aggregate cost of $6.1 million during the quarter bringing total repurchases since the inception of the share repurchase program to 11.7 million shares for an aggregate cost of $68.5 million
  • Announced senior management appointments in June

NEW YORK--(BUSINESS WIRE)--Aug. 5, 2016-- Apollo Investment Corporation (NASDAQ:AINV) or the “Company,” or “Apollo Investment,” today announced financial results for its first fiscal quarter ended June 30, 2016. The Company’s net investment income was $0.17 per share for the quarter ended June 30, 2016, excluding $0.01 per share of non-recurring expenses(1),compared to $0.20 per share for the quarter ended March 31, 2016. The Company’s net asset value (“NAV”) was $6.90 per share as of June 30, 2016 compared to $7.28 as of March 31, 2016.

On August 4, 2016, the Board of Directors declared a dividend of $0.15 per share for the first quarter of fiscal year 2017, payable on October 5, 2016 to shareholders of record as of September 21, 2016.

Mr. James Zelter, Apollo Investment’s Chief Executive Officer, commented, “The Board and the management team are focused on driving long-term shareholder value. We have taken this opportunity with the previously announced management changes and the recent receipt of co-investment exemptive relief, to redefine AINV's strategy in a direction which we believe is designed to provide shareholders with a more consistent return and a stable NAV. We intend to reposition a portion of our portfolio in a steady and coordinated manner into traditional corporate loans directly sourced from the Apollo platform. We have already made what we believe to be good progress in the past few months with the resolution of certain legacy positions, and lowering our oil and gas exposure to less than 10% of the portfolio, at fair value, subsequent to quarter end.” Mr. Zelter continued, “The management team and the Board determined that it was prudent and appropriate to reduce the dividend at this time. We believe that adjusting the dividend should ultimately create long-term value for our shareholders.”

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(1)   During the quarter ended June 30, 2016, the Company recognized $2.7 million, or $0.01 per share, of non-recurring expenses related to a strategic transaction that was considered but did not occur.
(2) Numbers for March 31, 2016 were updated due to the retrospective application of the new accounting pronouncements (ASU 2015-03 and ASU 2015-15) adopted as of June 30, 2016.
 

 

FINANCIAL HIGHLIGHTS

                   
($ in billions, except per share data)

June 30,
2016

March 31,
2016

December 31,
2015

September 30,
2015

June 30,
2015

Total assets $ 2.79 $ 3.09 $ 3.22 $ 3.30 $ 3.45
Investment portfolio (fair value) $ 2.62 $ 2.92 $ 3.07 $ 3.19 $ 3.31
Debt outstanding (1) $ 1.10 $ 1.31 $ 1.38 $ 1.37 $ 1.39
Net assets $ 1.55 $ 1.65 $ 1.72 $ 1.83 $ 1.90
Net asset value per share $ 6.90 $ 7.28 $ 7.56 $ 7.83 $ 8.01
 
Debt-to-equity ratio (1) 0.71 x 0.80 x 0.80 x

0.75 x

0.73 x
Net leverage ratio (1) (2) 0.66 x 0.75 x 0.76 x 0.73 x 0.72 x
 
___________________
(1)   Numbers for March 31, 2016 were updated due to the retrospective application of the new accounting pronouncements (ASU 2015-03 and ASU 2015-15) adopted as of June 30, 2016.
(2) The Company’s net leverage ratio is defined as debt outstanding plus payable for investments purchased, less receivable for investments sold, less cash, less foreign currency, divided by net assets.
 
   

PORTFOLIO AND INVESTMENT ACTIVITY

 

Three Months
Ended June 30,

(in millions)* 2016
Investments made in portfolio companies $ 122.7
Investments sold (146.0 )
Net activity before repaid investments (23.3 )
Investments repaid (193.4 )
Net investment activity $ (216.7 )
 
Portfolio companies at beginning of period 89
Number of new portfolio companies 5
Number of exited portfolio companies (13 )
Portfolio companies at end of period 81  
 
Number of investments in existing portfolio companies 12
 
____________________

*

Totals may not foot due to rounding.

 
   

OPERATING RESULTS (1)

 

Three Months
Ended June 30,

(in millions) 2016
Net investment income $ 36.1  
Net realized and change in unrealized losses (78.2 )
Net decrease in net assets resulting from operations $ (42.1 )
 
(per share)
Net investment income on per average share basis $ 0.16
Net realized and change in unrealized loss per share $ (0.35 )
Earnings (Loss) per share — basic $ (0.19 )
Earnings (Loss) per share — diluted (2)

N/A

 
____________________
(1)   During the quarter ended June 30, 2016, the Company recognized $2.7 million, or $0.01 per share, of non-recurring expenses related to a strategic transaction that was considered but did not occur. Numbers for the quarter ended June 30, 2016 include these expenses.
(2) For the three months ended June 30, 2016, the Company did not have any convertible notes. As such, diluted EPS was not applicable.