HOUSTON, March 6, 2019 /PRNewswire/ -- Stellus Capital
Investment Corporation (NYSE:SCM) ("Stellus" or "the Company") today announced financial results for its fourth fiscal quarter
and year ended December 31, 2018.
|
HIGHLIGHTS
|
|
($ in millions, except data relating to per share amounts and number of
portfolio companies)
|
|
|
As of
|
|
|
|
Portfolio results
|
December 31,
2018
|
|
|
|
Total assets
|
$526.3
|
|
|
|
Investment portfolio, at fair value
|
$504.5
|
|
|
|
Net assets
|
$224.8
|
|
|
|
Weighted average yield on debt investments
|
10.9%
|
|
|
|
Net asset value per share
|
$14.09
|
|
|
|
|
|
|
|
Year
|
|
Quarter
|
|
ended
|
|
ended
|
|
December 31,
2018
|
|
December 31,
2018
|
|
Portfolio activity
|
|
|
|
|
|
|
|
Total investments made, at par
|
$278.1
|
|
$75.9
|
|
Number of new investments
|
17
|
|
5
|
|
Repayments and sale of investments, including amortization
|
$147.6
|
|
$44.7
|
|
Number of portfolio companies at end
of period
|
57
|
|
57
|
|
|
|
|
|
Operating results
|
|
|
|
|
|
|
|
|
Total investment income
|
$53.3
|
|
$15.2
|
|
Net investment income
|
$22.6
|
|
$7.8
|
|
Net investment income per share
|
$1.42
|
|
$0.49
|
|
|
|
|
|
Core net investment income(1)
|
$22.7
|
|
$6.7
|
|
Core net investment income per share(1)
|
$1.42
|
|
$0.42
|
|
|
|
|
|
Realized gains per share, net of tax provision
|
$0.33
|
|
$0.01
|
|
Distributions per share
|
$1.36
|
|
$0.34
|
|
Net increase in net assets from operations
|
$26.2
|
|
$2.4
|
|
Net increase in net assets from operations per share
|
$1.64
|
|
$0.14
|
|
Weighted average shares outstanding during the period
|
15,953,571
|
|
15,953,810
|
|
|
(1)
|
Core net investment income, as presented, excludes the impact of capital
gains incentive fees. The company believes presenting core net investment income and the related per share amount
is a useful supplemental disclosure for analyzing its financial performance. However, core net investment income is
a non-U.S GAAP measure and should not be considered as a replacement for net investment income and other earnings
measures presented in accordance with U.S GAAP. A reconciliation of net investment income in accordance with U.S
GAAP to core net investment income is presented in the table below the financial statements.
|
"Upon completion of our sixth full year of operations, we are pleased to report that our shareholders have received dividends
in excess of $112 million since inception. During 2018, we increased net asset value by
$0.28 per share and recorded both core net investment income and regular net investment income of
$1.42 per share as compared to dividends of $1.36 per share.
Realized gains plus core net investment income were $1.75 per share. Approximately 27% of 2018
dividends paid were classified as long term capital gains on our shareholders' Form 1099. For the fourth quarter, core net
investment income was $0.42 per share, substantially covering fourth quarter dividends of
$0.34 per share," said Robert T. Ladd, the Company's Chief Executive
Officer.
Portfolio and Investment Activity
We completed the fourth quarter of 2018 with a portfolio of $504.5 million (at fair value)
invested in 57 companies. As of December 31, 2018, our portfolio included approximately 58%
of first lien debt, 30% of second lien debt, 5% of unsecured debt and 7% of equity investments at fair value. Our debt
portfolio consisted of 91% floating rate investments (subject to interest rate floors) and 9% fixed rate investments. The
average size of our portfolio company investments was $8.9 million and our largest portfolio
company investment was approximately $22.3 million, both at fair value. The weighted average
yield on all of our debt investments as of December 31, 2018 was approximately 10.9%.
During the year ended December 31, 2018, we made $278.1 million of
investments at par in seventeen new and twelve existing portfolio companies, and received $147.6
million from amortization and repayments of certain other investments.
This compares to the portfolio as of December 31, 2017, which had a fair value of $371.8 million invested in 48 companies, comprised of 38% of first lien debt, 48% of second lien debt, 7% of
unsecured debt and 7% of equity investments at fair value. The weighted average yield on all of our debt investments as of
December 31, 2017 was approximately 10.8%. The debt portfolio consisted of 87% floating rate
investments (subject to interest rate floors) and 13% fixed rate investments.
Results of Operations
Investment income for the year ended December 31, 2018 and 2017 totaled $53.3 million and $39.6 million, respectively, most of which was interest income
from portfolio investments.
Operating expenses for the year ended December 31, 2018 and 2017, totaled $30.6 million and $21.3 million, respectively. For the same respective periods,
base management fees totaled $8.2 million and $6.3 million, income
incentive fees totaled $5.5 million and $2.9 million, capital gains
incentive fees totaled $0.1 million and $0, fees and expenses related
to our borrowings totaled $12.3 million and $7.9 million (including
interest and amortization of deferred financing costs), administrative expenses totaled $1.4
million and $1.2 million, and other expenses totaled $3.1
million and $3.0 million, respectively.
Net investment income was $22.6 million and $18.0 million, or
$1.42 and $1.21 per common share based on weighted average common
shares outstanding for the year ended December 31, 2018 and 2017 of 15,953,571 and 14,870,981,
respectively.
The Company's investment portfolio had a net change in unrealized depreciation for the year ended December 31, 2018 and 2017, of ($1.6) million and ($0.02) million, respectively. For the year ended December 31, 2018 and
2017, the Company had realized gains of $5.3 million and $4.7
million, respectively, net of provision for taxes on realized gains of $0.3 million and
$0, respectively.
Net increase in net assets resulting from operations totaled $26.2 million and $22.6 million, or $1.64 and $1.52 per common share
based on weighted average common shares outstanding for the year ended December 31, 2018 and
2017 of 15,953,571 and 14,870,981, respectively.
Liquidity and Capital Resources
As of December 31, 2018 and 2017, our credit facilities provided for borrowings in an aggregate
amount up to $180.0 and $140.0 million, respectively, on a committed
basis. As of December 31, 2018, our credit facility had an accordion feature which allowed
for potential future expansion of the facility size to $195.0 million. As of December 31, 2018 and 2017, we had $99.6 million and $40.8
million in outstanding borrowings under the credit facility, respectively.
For the year ended December 31, 2018, our operating activities used cash of $102.4 million, primarily in connection with the purchase of portfolio investments, offset by sales and
repayments of portfolio investments. For the same period, our financing activities provided cash of $94.8 million, primarily from proceeds from SBA-guaranteed debentures and net borrowings on our credit
facility
For the year ended December 31, 2017, our operating activities provided cash of $18.9 million, primarily in connection with cash interest received and repayments of our investments, and our
financing activities used cash of $2.9 million, primarily related to net repayments under our
credit facility.
Distributions
During the three and twelve months ended December 31, 2018, we declared aggregate distributions
of $0.34 and $1.36 per share ($5.4
million and $21.7 million, respectively). During the three and twelve months ended
December 31, 2017, we declared aggregate distributions of $0.34 and
$1.36 per share ($5.4 million and $20.3
million, respectively). Tax characteristics of all distributions were reported to stockholders on Form 1099-DIV. None of
these dividends are expected to include a return of capital.
Recent Portfolio Activity
For the quarter ended December 31, 2018, we funded $75.9 million
at par in five new and five existing portfolio companies and received $44.7 million in total
proceeds from full payoffs, partial sales, and other amortizations. The new investment transactions and repayments that occurred
during the quarter are summarized as follows:
On October 1, 2018, we received full repayment on the second lien term loan of Roberts-Gordon, LLC for total proceeds of $7.2
million, including a $0.1 million prepayment fee. We also received a distribution related to
our equity of $0.9 million, which resulted in a realized gain of $0.4
million.
On October 1, 2018, we invested $10.0 million in the second lien
term loan of NGS US Finco, LLC, a manufacturer of rotary meters, pipeline distribution repair/upgrade products, electric
actuators and chemical pumps to natural gas utilities and energy/industrial distributors.
On October 2, 2018, we invested $3.3 million in the first lien
term loan of TechInsights, Inc., an existing portfolio company.
On October 18, 2018, we invested $10.7 million in the first lien
term loan and $3.7 million in the unfunded delayed draw term loan of Premiere Digital Services,
Inc., a provider of digital media services to the entertainment industry. Additionally, we invested $0.5
million in the equity of the company.
On October 31, 2018, we received full repayment on the second lien term loan of Keais Records
Service, LLC for total proceeds of $7.9 million, including a $0.1
million prepayment fee.
On November 15, 2018, we invested $15.5 million in the first lien
term loan and $2.0 million in the unfunded revolver of Nutritional Medicinals, LLC, a developer and
distributor of branded feeding tube formulas for the enteral feeding market. Additionally, we invested $1.25 million in the equity of the company.
On November 30, 2018, we invested $10.0 million in the first lien
term loan of APG Intermediate Sub 2 Corp., a provider of software and services to airline aviation markets. Additionally, we also
invested $1.0 million in the equity of the company.
On December 7, 2018, we invested a total of $0.1 million in the
equity of J.R. Watkins Holdings Inc., an existing portfolio company.
On December 17, 2018, we invested $2.5 million in the revolver of
Furniture Factory Outlet, LLC, an existing portfolio company.
On December 21, 2018, we received full repayment on the second lien term loan of Hostway
Corporation for total proceeds of $8.0 million, which included $1.2
million of previously reserved PIK.
On December 28, 2018, we invested $17.5 million in the first lien
term loan of Jurassic Intermediate Holdings Corp., a producer and distributor of air-float kaolin and gel-grade attapulgite clays
for customers in diversified end markets.
On December 31, 2018, we received full repayment on the first lien term loan of Energy Labs Inc.
for total proceeds of $8.5 million, including a $0.1 million
prepayment fee. We invested an additional $0.1 million in the equity of the company associated with
a company acquisition.
Subsequent Events
On January 4, 2019, we received full repayment on the first lien term loan of EOS Fitness OPCO
Holdings, LLC for total proceeds of $3.1 million. We also received a distribution related to our
equity of $0.1 million.
On January 7, 2019 we received $0.3 million in full realization on
the equity of OGS Holdings, Inc., resulting in a realized gain of $0.2 million.
On February 4, 2019, we invested $8.5 million in the first lien
term loan of ASC Communications, LLC, an existing portfolio company.
On February 8, 2019, we invested $12.3 million in the first lien
term loan of Exacta Land Surveyors LLC, a provider of land surveys and field management services used to facilitate the
purchasing, selling, and development of residential real estate in the U.S. Additionally, we committed $1.5 million in the unfunded revolver, $4.0 million in the unfunded delayed draw
term loan, and invested $1.0 million in the equity of the company.
On February 15, 2019, we received $0.05 million in full
realization on the equity of Glori Energy Production, LLC.
On February 28, 2019, we invested $1.4 million in the first lien
term loan of Convergence Technologies, Inc., an existing portfolio company. Additionally, we funded $5.4
million under the existing delayed draw term loan and an additional $0.1 million in the
equity of the company.
Credit Facility
The outstanding balance under the credit facility as of March 4, 2019 was $112.8 million.
SBA-guaranteed Debentures
The total balance of SBA-guaranteed Debentures outstanding as of March 4, 2019 was $150.0 million.
Conference Call Information
Stellus Capital Investment Corporation will host a conference call to discuss these results on Wednesday, March 6, 2019 at 10:00 AM, Central Standard Time. The conference
call will be led by Robert T. Ladd, chief executive officer, and W. Todd
Huskinson, chief financial officer, chief compliance officer, treasurer, and secretary.
For those wishing to participate by telephone, please dial 877-260-1479 (domestic). Use passcode 4047508. Starting
approximately twenty-four hours after the conclusion of the call, a replay will be available through Thursday, March 14, 2019 by dialing (888) 203-1112 and entering passcode 4047508. The replay will also be
available on the company's website.
Contacts
Stellus Capital Investment Corporation
W. Todd Huskinson, (713) 292-5414
Chief Financial Officer
thuskinson@stelluscapital.com
|
PART I — FINANCIAL INFORMATION
|
|
|
STELLUS CAPITAL INVESTMENT CORPORATION
|
|
|
CONSOLIDATED STATEMENTS OF ASSETS AND LIABILITIES
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
December 31,
|
|
December 31,
|
|
|
|
2018
|
|
2017
|
|
ASSETS
|
|
|
|
|
|
|
Non-controlled, affiliated investments, at fair value (amortized cost of $52,185 and $1,052,185, respectively)
|
$
|
50,000
|
|
$
|
990,000
|
|
Non-controlled, non-affiliated investments, at fair value
(amortized cost of $502,691,464 and $367,401,021, respectively)
|
|
504,433,668
|
|
|
370,849,772
|
|
Cash and cash equivalents
|
|
17,467,146
|
|
|
25,110,718
|
|
Receivable for sales and repayments of investments
|
|
99,213
|
|
|
26,891
|
|
Interest receivable
|
|
3,788,684
|
|
|
2,922,204
|
|
Other receivables
|
|
85,246
|
|
|
—
|
|
Deferred offering costs
|
|
18,673
|
|
|
—
|
|
Prepaid expenses
|
|
344,621
|
|
|
361,270
|
|
|
Total Assets
|
$
|
526,287,251
|
|
$
|
400,260,855
|
|
LIABILITIES
|
|
|
|
|
|
|
Notes payable
|
$
|
47,641,797
|
|
$
|
47,306,488
|
|
Credit facility payable
|
|
98,237,227
|
|
|
39,332,479
|
|
SBA-guaranteed debentures
|
|
146,387,802
|
|
|
87,818,813
|
|
Dividends payable
|
|
1,807,570
|
|
|
1,806,671
|
|
Management fees payable
|
|
2,183,975
|
|
|
1,621,592
|
|
Income incentive fees payable
|
|
1,936,538
|
|
|
371,647
|
|
Capital gains incentive fees payable
|
|
81,038
|
|
|
—
|
|
Interest payable
|
|
1,863,566
|
|
|
1,021,173
|
|
Unearned revenue
|
|
410,593
|
|
|
139,304
|
|
Administrative services payable
|
|
392,191
|
|
|
327,033
|
|
Deferred tax liability
|
|
67,953
|
|
|
—
|
|
Income tax payable
|
|
316,092
|
|
|
—
|
|
Other accrued expenses and liabilities
|
|
115,902
|
|
|
268,413
|
|
|
Total Liabilities
|
$
|
301,442,244
|
|
$
|
180,013,613
|
|
Commitments and contingencies (Note 7)
|
|
|
|
|
|
|
|
Net Assets
|
$
|
224,845,007
|
|
$
|
220,247,242
|
|
NET ASSETS
|
|
|
|
|
|
|
Common Stock, par value $0.001 per share (200,000,000 shares
and 100,000,000 shares authorized; 15,953,810 and 15,945,879 issued and outstanding, respectively)
|
$
|
15,954
|
|
$
|
15,946
|
|
Paid-in capital
|
|
228,160,491
|
|
|
228,066,762
|
|
Accumulated net realized loss from investments, net
of cumulative dividends of $9,519,362 and $4,246,819, respectively, and tax provision on realized gain of $267,975
and $0, respectively
|
|
(10,786,240)
|
|
|
(10,786,240)
|
|
Accumulated undistributed net investment income
|
|
5,782,736
|
|
|
(435,794)
|
|
Net unrealized appreciation on non-controlled,
non-affiliated investments and cash equivalents, net of provision for
taxes of $67,953 and $0, respectively (Note 13)
|
|
1,674,251
|
|
|
3,448,753
|
|
Net unrealized depreciation on non-controlled, affiliated investments
|
|
(2,185)
|
|
|
(62,185)
|
|
|
Net Assets
|
$
|
224,845,007
|
|
$
|
220,247,242
|
|
|
Total Liabilities and Net Assets
|
$
|
526,287,251
|
|
$
|
400,260,855
|
|
|
Net Asset Value Per Share
|
$
|
14.09
|
|
$
|
13.81
|
|
STELLUS CAPITAL INVESTMENT CORPORATION
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CONSOLIDATED STATEMENTS OF OPERATIONS
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For the
|
|
For the
|
|
For the
|
|
|
|
year
|
year
|
|
year
|
|
|
|
ended
|
ended
|
|
ended
|
|
|
|
December 31,
|
December 31,
|
|
December 31,
|
|
|
|
2018
|
2017
|
|
2016
|
|
INVESTMENT INCOME
|
|
|
|
|
|
|
|
|
|
Interest income
|
$
|
51,463,033
|
|
$
|
38,071,449
|
|
$
|
38,176,617
|
|
Other income
|
|
1,803,305
|
|
|
1,576,744
|
|
|
1,313,580
|
|
|
Total Investment Income
|
$
|
53,266,338
|
|
$
|
39,648,193
|
|
$
|
39,490,197
|
|
OPERATING EXPENSES
|
|
|
|
|
|
|
|
|
|
Management fees
|
$
|
8,154,842
|
|
$
|
6,255,911
|
|
$
|
6,281,863
|
|
Valuation fees
|
|
307,838
|
|
|
336,300
|
|
|
397,330
|
|
Administrative services expenses
|
|
1,390,375
|
|
|
1,245,727
|
|
|
1,045,648
|
|
Income incentive fees
|
|
5,529,376
|
|
|
2,911,392
|
|
|
4,275,436
|
|
Capital gains incentive fees
|
|
81,038
|
|
|
—
|
|
|
—
|
|
Professional fees
|
|
1,189,071
|
|
|
1,274,066
|
|
|
712,524
|
|
Directors' fees
|
|
317,000
|
|
|
331,000
|
|
|
324,000
|
|
Insurance expense
|
|
348,500
|
|
|
429,897
|
|
|
471,427
|
|
Interest expense and other fees
|
|
12,338,755
|
|
|
7,855,211
|
|
|
7,992,185
|
|
Income tax expense
|
|
275,106
|
|
|
—
|
|
|
—
|
|
Deferred offering costs
|
|
—
|
|
|
—
|
|
|
261,761
|
|
Other general and administrative expenses
|
|
697,900
|
|
|
621,204
|
|
|
415,822
|
|
|
Total Operating Expenses
|
$
|
30,629,801
|
|
$
|
21,260,708
|
|
$
|
22,177,996
|
|
|
Loss on extinguishment of debt
|
|
—
|
|
|
416,725
|
|
|
—
|
|
|
Net Investment Income
|
$
|
22,636,537
|
|
$
|
17,970,760
|
|
$
|
17,312,201
|
|
|
Net realized gain (loss) on non-controlled, non-affiliated
investments and cash equivalents
|
$
|
5,540,518
|
|
$
|
4,655,976
|
|
$
|
(13,089,671)
|
|
|
Tax provision on realized gain on investments
|
|
(267,975)
|
|
|
—
|
|
|
—
|
|
|
Net change in unrealized appreciation (depreciation) on
non-controlled, non-affiliated investments and cash equivalents
|
$
|
(1,706,549)
|
|
$
|
40,113
|
|
$
|
18,603,401
|
|
|
Net change in unrealized appreciation (depreciation) on
non-controlled, affiliated investments and cash equivalents
|
|
60,000
|
|
|
(62,185)
|
|
|
-
|
|
|
Benefit (provision) for taxes on net unrealized gain (loss)
on investments
|
$
|
(67,953)
|
|
$
|
8,593
|
|
$
|
373,131
|
|
|
Net Increase in Net Assets Resulting from Operations
|
$
|
26,194,578
|
|
$
|
22,613,257
|
|
$
|
23,199,062
|
|
|
Net Investment Income Per Share
|
$
|
1.42
|
|
$
|
1.21
|
|
$
|
1.39
|
|
|
Net Increase in Net Assets Resulting from Operations Per Share
|
$
|
1.64
|
|
$
|
1.52
|
|
$
|
1.86
|
|
|
Weighted Average Shares of Common Stock Outstanding
|
|
15,953,571
|
|
|
14,870,981
|
|
|
12,479,959
|
|
|
Distributions Per Share
|
$
|
1.36
|
|
$
|
1.36
|
|
$
|
1.36
|
|
STELLUS CAPITAL INVESTMENT CORPORATION
|
|
|
CONSOLIDATED STATEMENTS OF CHANGES IN NET ASSETS
|
|
|
|
|
|
|
|
|
|
For the year
|
|
For the year
|
|
For the year
|
|
|
ended
|
|
ended
|
|
ended
|
|
|
December 31,
|
|
December 31,
|
|
December 31,
|
|
|
2018
|
|
2017
|
|
2016
|
|
Increase in Net Assets Resulting from Operations
|
|
|
|
|
|
|
|
|
|
Net investment income
|
$
|
22,636,537
|
|
$
|
17,970,760
|
|
$
|
17,312,201
|
|
Net realized gain (loss) on investments and cash equivalents
|
|
5,540,518
|
|
|
4,655,976
|
|
|
(13,089,671)
|
|
Tax provision on realized gain on investments
|
|
(267,975)
|
|
|
—
|
|
|
—
|
|
Net change in unrealized appreciation (depreciation) on non-controlled, non-affiliated investments and cash equivalents
|
|
(1,706,549)
|
|
|
40,113
|
|
|
18,603,401
|
|
Net change in unrealized appreciation (depreciation) on non-controlled, affiliated investments and cash equivalents
|
|
60,000
|
|
|
(62,185)
|
|
|
—
|
|
Benefit (provision) for taxes on unrealized appreciation on investments
|
|
(67,953)
|
|
|
8,593
|
|
|
373,131
|
|
Net Increase in Net Assets Resulting from Operations
|
$
|
26,194,578
|
|
$
|
22,613,257
|
|
$
|
23,199,062
|
|
Stockholder distributions from:
|
|
|
|
|
|
|
|
|
|
Net investment income
|
|
(16,418,007)
|
|
|
(17,970,760)
|
|
|
(16,968,350)
|
|
Net realized capital gains
|
|
(5,272,543)
|
|
|
(2,352,545)
|
|
|
—
|
|
Total Distributions
|
$
|
(21,690,550)
|
|
$
|
(20,323,305)
|
|
$
|
(16,968,350)
|
|
Capital Share Transactions
|
|
|
|
|
|
|
|
|
|
Issuance of common stock
|
$
|
94,788
|
|
$
|
48,741,549
|
|
$
|
—
|
|
Sales load
|
|
—
|
|
|
(1,358,880)
|
|
|
—
|
|
Offering costs
|
|
—
|
|
|
(307,022)
|
|
|
—
|
|
Partial share redemption
|
|
(1,051)
|
|
|
(142)
|
|
|
(31)
|
|
Net Increase (Decrease) in Net Assets Resulting From
|
|
|
|
|
|
|
|
|
|
Capital Share Transactions
|
$
|
93,737
|
|
$
|
47,075,505
|
|
$
|
(31)
|
|
Total Increase in Net Assets
|
$
|
4,597,765
|
|
$
|
49,365,457
|
|
$
|
6,230,681
|
|
Net Assets at Beginning of Period
|
$
|
220,247,242
|
|
$
|
170,881,785
|
|
$
|
164,651,104
|
|
Net Assets at End of Period (Includes $5,782,736, $(435,794)
and $(435,794) of Accumulated Undistributed Net Investment Income (Loss), Respectively)
|
$
|
224,845,007
|
|
$
|
220,247,242
|
|
$
|
170,881,785
|
|
STELLUS CAPITAL INVESTMENT CORPORATION
|
|
|
CONSOLIDATED STATEMENTS OF CASH FLOWS
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For the year
|
|
For the year
|
|
For the year
|
|
|
|
|
ended
|
|
ended
|
|
ended
|
|
|
|
|
December 31,
|
|
December 31,
|
|
December 31,
|
|
|
|
|
2018
|
|
2017
|
|
2016
|
|
Cash flows from operating activities
|
|
|
|
|
|
|
|
|
|
Net Increase in net assets resulting from operations
|
$
|
26,194,578
|
|
$
|
22,613,257
|
|
$
|
23,199,062
|
|
Adjustments to reconcile net increase in net assets resulting from
operations to net cash provided by (used in) operating activities:
|
|
|
|
|
|
|
|
|
|
Purchases of investments
|
|
(272,927,459)
|
|
|
(172,171,246)
|
|
|
(65,661,034)
|
|
Proceeds from sales and repayments of investments
|
|
147,528,448
|
|
|
172,260,541
|
|
|
55,949,177
|
|
Net change in unrealized depreciation (appreciation) on
investments
|
|
1,646,549
|
|
|
22,072
|
|
|
(18,603,401)
|
|
Increase in investments due to PIK
|
|
(1,869,905)
|
|
|
(499,595)
|
|
|
(243,766)
|
|
Amortization of premium and accretion of discount, net
|
|
(1,553,333)
|
|
|
(1,196,566)
|
|
|
(1,128,511)
|
|
Deferred tax provision (benefit)
|
|
67,953
|
|
|
(8,593)
|
|
|
(373,130)
|
|
Amortization of loan structure fees
|
|
456,151
|
|
|
455,893
|
|
|
523,835
|
|
Amortization of deferred financing costs
|
|
335,309
|
|
|
251,826
|
|
|
326,190
|
|
Amortization of loan fees on SBA-guaranteed debentures
|
|
623,989
|
|
|
333,027
|
|
|
184,783
|
|
Net realized (gain) loss on investments
|
|
(5,540,518)
|
|
|
(4,655,976)
|
|
|
13,089,341
|
|
Loss on extinguishment of debt
|
|
-
|
|
|
416,725
|
|
|
-
|
|
Deferred offering costs
|
|
-
|
|
|
-
|
|
|
261,761
|
|
Changes in other assets and liabilities
|
|
|
|
|
|
|
|
|
|
Decrease (increase) in interest receivable
|
|
(866,480)
|
|
|
1,679,538
|
|
|
118,289
|
|
Decrease (increase) in other receivable
|
|
(85,246)
|
|
|
748
|
|
|
6,936
|
|
Decrease in prepaid expenses
|
|
16,649
|
|
|
94,949
|
|
|
19,230
|
|
Increase in management fees payable
|
|
562,383
|
|
|
13,297
|
|
|
89,516
|
|
Increase (decrease) in incentive fees payable
|
|
1,564,891
|
|
|
(981,624)
|
|
|
745,315
|
|
Increase in capital gains incentive fees payable
|
|
81,038
|
|
|
-
|
|
|
-
|
|
Increase (decrease) in administrative services payable
|
|
65,158
|
|
|
54,522
|
|
|
(125,288)
|
|
Increase in interest payable
|
|
842,393
|
|
|
47,361
|
|
|
403,623
|
|
Increase (decrease) in unearned revenue
|
|
271,289
|
|
|
119,349
|
|
|
(16,922)
|
|
Increase in income tax payable
|
|
316,092
|
|
|
-
|
|
|
-
|
|
Increase (decrease) in other accrued expenses and liabilities
|
|
(152,511)
|
|
|
1,022
|
|
|
71,714
|
|
Net Cash Provided by (Used in) Operating Activities
|
$
|
(102,422,582)
|
|
$
|
18,850,527
|
|
$
|
8,836,720
|
|
Cash flows from financing activities
|
|
|
|
|
|
|
|
|
|
Proceeds from the issuance of common stock
|
$
|
-
|
|
$
|
48,741,549
|
|
$
|
-
|
|
Sales load for common stock issued
|
|
-
|
|
|
(1,358,880)
|
|
|
-
|
|
Offering costs paid for common stock
|
|
(18,673)
|
|
|
(307,022)
|
|
|
-
|
|
Proceeds from notes issued
|
|
-
|
|
|
48,875,000
|
|
|
-
|
|
Financing costs paid for Notes issued
|
|
-
|
|
|
(1,688,961)
|
|
|
-
|
|
Repayments on Notes issued
|
|
-
|
|
|
(25,000,000)
|
|
|
-
|
|
Stockholder distributions paid
|
|
(21,594,863)
|
|
|
(19,930,616)
|
|
|
(16,968,350)
|
|
Proceeds from SBA Debentures
|
|
60,000,000
|
|
|
25,000,000
|
|
|
-
|
|
Financing costs paid on SBA Debentures
|
|
(2,055,000)
|
|
|
(856,250)
|
|
|
-
|
|
Borrowings under Credit Facility
|
|
246,300,000
|
|
|
194,250,000
|
|
|
56,500,000
|
|
Repayments of Credit Facility
|
|
(187,500,000)
|
|
|
(269,500,000)
|
|
|
(50,000,000)
|
|
Financing costs paid on Credit facility
|
|
(351,403)
|
|
|
(1,158,616)
|
|
|
(50,000)
|
|
Partial Share Redemption
|
|
(1,051)
|
|
|
(142)
|
|
|
(31)
|
|
Net Cash Provided by (Used in) Financing Activities
|
$
|
94,779,010
|
|
$
|
(2,933,938)
|
|
$
|
(10,518,381)
|
|
Net Increase (Decrease) in Cash and Cash Equivalents
|
$
|
(7,643,572)
|
|
$
|
15,916,589
|
|
$
|
(1,681,661)
|
|
Cash and cash equivalents balance at beginning of period
|
|
25,110,718
|
|
|
9,194,129
|
|
|
10,875,790
|
|
Cash and Cash Equivalents Balance at End of Period
|
$
|
17,467,146
|
|
$
|
25,110,718
|
|
$
|
9,194,129
|
|
Supplemental and Non-Cash Activities
|
|
|
|
|
|
|
|
|
|
Cash paid for interest expense
|
$
|
10,075,913
|
|
$
|
6,762,104
|
|
$
|
6,548,754
|
|
Excise tax paid
|
|
27,717
|
|
|
37,648
|
|
|
-
|
|
Shares issued pursuant to Dividend Reinvestment Plan
|
|
94,788
|
|
|
-
|
|
|
-
|
|
Conversion from debt to equity
|
|
-
|
|
|
864,101
|
|
|
-
|
|
Increase in Distribution Payable
|
|
899
|
|
|
392,689
|
|
|
-
|
|
|
|
|
|
|
|
|
|
|
|
Reconciliation of Core Net Investment Income
|
|
(Unaudited)
|
|
|
|
|
Year
|
|
|
Quarter
|
|
|
|
ended
|
|
|
ended
|
|
|
|
December 31,
|
|
|
December 31,
|
|
|
|
2018
|
|
|
2018
|
|
Net investment income
|
$
|
22,636,537
|
|
$
|
7,823,948
|
|
Capital gains incentive fee
|
|
81,038
|
|
|
(1,092,212)
|
|
Core net investment income(1)(2)
|
$
|
22,717,575
|
|
$
|
6,731,736
|
|
|
|
|
|
|
|
|
Per share amounts:
|
|
|
|
|
|
|
Net investment income per share
|
$
|
1.42
|
|
$
|
0.49
|
|
Core net investment income per share(1)(2)
|
$
|
1.42
|
|
$
|
0.42
|
|
|
|
(2)
|
There were no capital gains incentive fees during the years ended December
31, 2017 and 2016.
|
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SOURCE Stellus Capital Investment Corporation