May 18, 2017
Apollo Investment Corporation Reports Financial Results for the Quarter and Fiscal Year Ended March 31, 2017
Fiscal Fourth Quarter and Other Recent Highlights:
- Net investment income per share for the quarter was $0.17, compared to $0.17for the quarter ended December 31, 2016
- Net asset value per share as of the end of the quarter was $6.74 compared to $6.86 as of December 31, 2016, a 1.7% decrease
- Declared a distribution of $0.15 per share
- Net leverage as of the end of the quarter was 0.55 x, compared to 0.66 x as of December 31, 2016 providing us with substantial investment capacity to execute our portfolio repositioning strategy
- Continued to make what we believe to be considerable progress
toward the successful execution of our portfolio repositioning
strategy including:
- Increased first lien debt to 45% of the total portfolio as of the end of the quarter, at fair value
- Increased floating rate debt to 84%(1) of the corporate debt portfolio as of the end of the quarter, at fair value
- Reduced exposure to non-core assets(2) by $372 million(3) since June 30, 2016 while meaningfully improving the risk profile of the portfolio
- Invested over $620 million in our core strategies(4) since July 1, 2016 through May 15, 2017, including more than $200 million since April 1, 2017 bringing net leverage within our target range
NEW YORK--(BUSINESS WIRE)-- Apollo Investment Corporation (NASDAQ:AINV) or the “Company,” or “Apollo Investment,” today announced financial results for its fourth fiscal quarter ended March 31, 2017. The Company’s net investment income was $0.17 per share for the quarter ended March 31, 2017, compared to $0.17 per share for the quarter ended December 31, 2016. The Company’s net asset value (“NAV”) was $6.74per share as of March 31, 2017 compared to$6.86 as of December 31, 2016.
On May 17, 2017, the Board of Directors declared a distribution of $0.15 per share, payable on July 6, 2017 to shareholders of record as of June 21, 2017.
Mr. James Zelter, Apollo Investment’s Chief Executive Officer, commented, “We have made considerable progress implementing the strategy that we outlined last year including 1) the deployment of capital into assets sourced by the Apollo / Midcap direct origination platform, including investments made pursuant to our co-investment exemptive order, 2) the reduction of our exposure to certain positions and industries which are higher on the risk spectrum and have more volatile returns, and 3) the resolution of several legacy positions.” Mr. Zelter continued, “Looking ahead to fiscal year 2018, we believe that we are well positioned for when opportunities become more attractive given our substantial investment capacity. We will continue to focus on deploying capital into opportunities sourced from the Apollo / MidCap direct origination platform.”
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| (1) | The Company has modified the calculation of its interest rate type information. The interest type information is calculated using the Company’s corporate debt portfolio and excludes aviation, oil and gas, structured credit, renewables, shipping, commodities and investments on non-accrual status. | |
| (2) | Non-core assets include oil & gas, structured credit, renewables, shipping, and commodities. | |
| (3) | Includes the repayment of the Company's investments in Craft 2013-1 which occurred in April 2017. | |
| (4) | Core strategies include corporate lending, aviation, life sciences, asset based and lender finance. | |
FINANCIAL HIGHLIGHTS | ||||||||||||||||||||||
| ($ in billions, except per share data) | March 31, | December 31, | September 30, | June 30, | March 31, | |||||||||||||||||
| Total assets (1) | $ | 2.41 | $ | 2.64 | $ | 2.65 | $ | 2.79 | $ | 3.08 | ||||||||||||
| Investment portfolio (fair value) | $ | 2.32 | $ | 2.53 | $ | 2.55 | $ | 2.62 | $ | 2.92 | ||||||||||||
| Debt outstanding (1) | $ | 0.85 | $ | 1.03 | $ | 1.01 | $ | 1.10 | $ | 1.31 | ||||||||||||
| Net assets | $ | 1.48 | $ | 1.51 | $ | 1.54 | $ | 1.55 | $ | 1.65 | ||||||||||||
| Net asset value per share | $ | 6.74 | $ | 6.86 | $ | 6.95 | $ | 6.90 | $ | 7.28 | ||||||||||||
| Debt-to-equity ratio (1) | 0.57 | x | 0.69 | x | 0.66 | x | 0.71 | x | 0.80 | x | ||||||||||||
| Net leverage ratio (1) (2) | 0.55 | x | 0.66 | x | 0.63 | x | 0.66 | x | 0.75 | x | ||||||||||||
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| (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 April 1, 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 currencies, divided by net assets. | |
PORTFOLIO AND INVESTMENT ACTIVITY | ||||||||||
| (in millions)* | Three Months | Year Ended | ||||||||
| Investments made in portfolio companies | $ | 149.4 | $ | 601.1 | ||||||
| Investments sold | (38.4 | ) | (219.5 | ) | ||||||
| Net activity before repaid investments | 111.0 | 381.6 | ||||||||
| Investments repaid | (306.4 | ) | (875.2 | ) | ||||||
| Net investment activity | $ | (195.4 | ) | $ | (493.6 | ) | ||||
| Portfolio companies at beginning of period | 85 | 89 | ||||||||
| Number of new portfolio companies | 13 | 37 | ||||||||
| Number of exited portfolio companies | (12 | ) | (40 | ) | ||||||
| Portfolio companies at end of period | 86 | 86 | ||||||||
| Number of investments made in existing portfolio companies | 10 | 26 | ||||||||
| ____________________ |
| * Totals may not foot due to rounding. |
OPERATING RESULTS | ||||||||||
| (in millions) * | Three Months | Year Ended | ||||||||
| Net investment income | $ | 37.3 | $ | 149.2 | ||||||
| Net realized and change in unrealized gains (losses) | (29.2 | ) | (130.9 | ) | ||||||
| Net increase (decrease) in net assets resulting from operations | $ | 8.1 | $ | 18.4 | ||||||
| (per share) * | ||||||||||
| Net investment income on per average share basis | $ | 0.17 | $ | 0.67 | ||||||
| Net realized and change in unrealized gain (loss) per share | (0.13 | ) | (0.59 | ) | ||||||
| Earnings per share — basic | $ | 0.04 | $ | 0.08 | ||||||
| ____________________ |
| * Totals may not foot due to rounding. |
SHARE REPURCHASE PROGRAM
On September 15, 2016, the Company announced that its Board of Directors expanded the Company’s stock repurchase program by $50 million which increased the total amount available to be repurchased to $150 million.
During the three months ended March 31, 2017, the Company did not repurchase any shares. During the year ended March 31, 2017, the Company repurchased 6,461,842 shares at weighted average price per share of $5.87 inclusive of commissions, for a total cost of $37.9 million.
Since the inception of the share repurchase program and through March 31, 2017, the Company repurchased 17,046,697 shares at weighted average price per share of $5.89 inclusive of commissions, for a total cost of $100.4 million.
CONFERENCE CALL / WEBCAST AT 10:00 AM EDT ON MAY 18, 2017
The Company will host a conference call on Thursday, May 18, 2017 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 #99579978 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 June 12, 2017 by dialing (800) 585-8367; international callers please dial (404) 537-3406, reference Conference ID # 99579978. 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 the Company’s 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 on the Investor Relations section of the Company’s website at www.apolloic.com.
Our portfolio composition and weighted average yields as of March 31, 2017, December 31, 2016, September 30, 2016, June 30, 2016, and March 31, 2016 were as follows:
March 31, | December 31, | September 30, | June 30, | March 31, | |||||||
| Portfolio composition, at fair value: | |||||||||||
| Secured debt | 75% | 69% | 64% |