New Mountain Finance Corporation Announces Financial Results for the Quarter Ended June 30, 2015
Reports Adjusted Net Investment Income of $0.35 per Weighted Average Share and Net Asset Value of $13.90 per Share
Declares Third Quarter 2015 Dividend of $0.34 per Share
Defensive Investment Strategy Underscored by Continued Strong Credit Performance
Originated $120 Million of Investments in the Quarter
NEW YORK--(BUSINESS WIRE)-- New Mountain Finance Corporation (NYSE:NMFC) (the "Company", “NMFC”, "we", "us" or "our") today announced its financial results for the quarter ended June 30, 2015 and reported second quarter Adjusted Net Investment Income of the Company of $0.35 per weighted average share. At June 30, 2015, net asset value (“NAV”) per share was $13.90, an increase of $0.01 from March 31, 2015. The Company also announced that its board of directors declared a third quarter 2015 dividend of $0.34 per share, which will be payable on September 30, 2015 to holders of record as of September 16, 2015.
During the second quarter, the Company amended its credit facility (the “NMFC Credit Facility”) and added Stifel Bank & Trust as a new lender with a $15.0 million commitment, bringing total commitments under the NMFC Credit Facility to $95.0 million.
Except where noted otherwise, all financial information shown is that of the Company.
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Selected Financial Highlights (in thousands, except per share data) |
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| June 30, 2015 | ||||||||||||||||||||
| Investment Portfolio(1) | $ | 1,338,872 | ||||||||||||||||||
| Total Assets | $ | 1,392,101 | ||||||||||||||||||
| Total Statutory Debt(2) | $ | 512,858 | ||||||||||||||||||
| NAV | $ | 808,326 | ||||||||||||||||||
| NAV per Share | $ | 13.90 | ||||||||||||||||||
| Statutory Debt/Equity | 0.63x | |||||||||||||||||||
| Pro Forma Statutory Debt/Equity(3) | 0.71x | |||||||||||||||||||
| Investment Portfolio Composition | June 30, 2015 | Percent of Total | ||||||||||||||||||
| First Lien | $ | 578,748 | 43.2 | % | ||||||||||||||||
| Second Lien(1) | 566,409 | 42.3 | % | |||||||||||||||||
| Subordinated | 92,516 | 6.9 | % | |||||||||||||||||
| Preferred Equity | 55,560 | 4.2 | % | |||||||||||||||||
| Investment Fund | 23,000 | 1.7 | % | |||||||||||||||||
| Common Equity and Other | 22,639 | 1.7 | % | |||||||||||||||||
| Total | $ | 1,338,872 | 100.0 | % | ||||||||||||||||
| Three Months Ended June 30, 2015 | ||||||||||||||||||||
| (in millions, except per share data) | GAAP |
Non-Cash Adjustments(4) |
Adjusted(4) | |||||||||||||||||
| Net investment income (“NII”) | $20.3 | ($0.1 | ) | $ | 20.2 | |||||||||||||||
| Net investment income per | ||||||||||||||||||||
| weighted average share | $0.35 | $ | 0.35 | |||||||||||||||||
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1 Includes collateral for securities purchased under collateralized agreements to resell of $30.0 million.
2 Excludes the Company’s SBA-guaranteed debentures.
3 Pro forma debt/equity reflects unfunded commitments and subsequent investment activity, refer to “Recent Developments” noted below for details.
4 Refer to “Reconciliation of Adjusted Net Investment Income” noted below for additional details.
We believe that the strength of the Company’s unique investment strategy – which focuses on acyclical “defensive growth” companies that are well researched by New Mountain Capital, L.L.C. (“New Mountain”), a leading private equity firm – is underscored by continued strong credit performance. The Company has had only four portfolio companies, representing approximately $36.4 million of the cost of all investments made since inception in October 2008, or approximately 1.1%, go on non-accrual.
Robert Hamwee, CEO, commented “The second quarter represented another solid quarter of performance for NMFC. We more than covered our dividend and continue to maintain a stable portfolio yield. Additionally, we have had an active start to the third quarter with originations of $124 million, allowing us to remain fully invested.”
“As managers and as significant stockholders personally, we are pleased with the progress of the Company and the completion of another successful quarter,” added Steven B. Klinsky, NMFC Chairman. “We believe our strategy of focusing on acyclical “defensive growth” industries and on companies that we know well continues to prove a successful strategy and preserves stockholder value.”
Portfolio and Investment Activity1
As of June 30, 2015, the Company’s net asset value was approximately $808.3 million and its portfolio had a fair value of approximately $1,338.9 million in 66 portfolio companies, with a weighted average Yield to Maturity at Cost2 of approximately 10.8%. For the three months ended June 30, 2015, the Company made approximately $119.8 million of originations and commitments3. The $119.8 million includes approximately $40.5 million of investments in three new portfolio companies and approximately $79.3 million of follow-on investments in five portfolio companies held as of March 31, 2015. For the three months ended June 30, 2015, the Company had approximately $9.1 million of sales in three portfolio companies and cash repayments3 of approximately $212.8 million.
Consolidated Results of Operations
The Company’s total adjusted investment income for the three months ended June 30, 2015 and 2014 were approximately $37.9 million and $33.7 million, respectively. For the three months ended June 30, 2015 and 2014, the Company’s total adjusted investment income consisted of approximately $31.1 million4 and $28.4 million in cash interest income from investments, respectively, prepayment penalties of approximately $2.8 million and $1.9 million, respectively, approximately $1.1 million4 and $0.7 million in payment-in-kind (“PIK”) interest income from investments, respectively, net amortization of purchase premiums/discounts of approximately $0.5 million and $0.6 million, respectively, cash dividend income of approximately $1.1 million and $1.3 million, respectively, PIK dividend income of approximately $0.7 million and $0.0 million, respectively, and approximately $0.6 million and $0.8 million in other income, respectively.
The Company’s total net expenses after income tax expense for the three months ended June 30, 2015 and 2014 were approximately $17.7 million and $15.1 million, respectively, excluding $0.0 million and $1.3 million of accrued hypothetical capital gains incentive fee, respectively. The hypothetical capital gains incentive fee is based upon the cumulative net Adjusted Realized Capital Gains (Losses)5 and the cumulative net Adjusted Unrealized Capital Appreciation (Depreciation)5 from inception through the end of the current period. Actual amounts paid to New Mountain Finance Advisers BDC, L.L.C. (the “Investment Adviser”) are consistent with the investment advisory and management agreement between the Company and the Investment Adviser (the “Investment Management Agreement”), and are based only on actual Adjusted Realized Capital Gains computed net of all Adjusted Realized Capital Losses and Adjusted Unrealized Capital Depreciation on a cumulative basis from inception through the end of each calendar year as if the entire portfolio was sold at fair value.
Total net expenses after income tax expense for the three months ended June 30, 2015 and 2014 consisted of approximately $5.6 million and $4.0 million, respectively, of costs associated with the Company’s borrowings and approximately $10.0 million and $9.2 million, respectively, in net management and incentive fees, excluding $0.0 million and $1.3 million of accrued hypothetical capital gains incentive fee, respectively. Since the initial public offering (“IPO”), the base management fee calculation has deducted the borrowings under the New Mountain Finance SPV Funding, L.L.C. credit facility (the “SLF Credit Facility”). The SLF Credit Facility has historically consisted of primarily lower yielding assets at higher advance rates. As part of an amendment to the Company’s existing credit facilities with Wells Fargo Bank, National Association, the SLF Credit Facility merged with and into the New Mountain Finance Holdings, L.L.C. credit facility (the “Holdings Credit Facility”) on December 18, 2014. Post credit facility merger and to be consistent with the methodology since IPO, the Investment Adviser will waive management fees on the leverage associated with those assets that share the same characteristics with investments leveraged under the legacy SLF Credit Facility, which approximated $251.5 million as of June 30, 2015. The Investment Adviser cannot recoup management fees that the Investment Adviser has previously waived. For the three months ended June 30, 2015, management fees waived were approximately $1.2 million. The Investment Advisor did not waive any management fees during the three months ended June 30, 2014. The Company’s net direct and indirect professional, administrative, other general and administrative and income tax expenses for the three months ended June 30, 2015 and 2014 were approximately $2.1 million and $1.9 million, respectively, which includes approximately $0.3 million and $0.3 million of indirect expenses reimbursable and payable to New Mountain Finance Administration, L.L.C. (the “Administrator”).
For the three months ended June 30, 2015 and 2014, the Company recorded approximately $(13.4) million of adjusted realized losses and $4.7 million of adjusted realized gains, respectively, and $13.6 million and $2.1 million of adjusted net changes in unrealized appreciation of investments, respectively. For the three months ended June 30, 2015 and 2014, provision for taxes was approximately $0.1 million and $0.4 million, respectively, related to differences between the computation of income for United States (“U.S.”) federal income tax purposes as compared to accounting principles generally accepted in the United States (“GAAP”).
Liquidity and Capital Resources
As of June 30, 2015, the Company had cash and cash equivalents of approximately $24.2 million and total statutory debt outstanding of approximately $512.9 million (approximately $359.9 million of the $495.0 million of total availability on the Holdings Credit Facility, $38.0 million of the $95.0 million of total availability on the Company’s NMFC Credit Facility and $115.0 million of convertible notes outstanding). Additionally, the Company had $55.0 million of SBA-guaranteed debentures outstanding as of June 30, 2015.
Portfolio and Asset Quality
The Company puts its largest emphasis on risk control and credit performance. On a quarterly basis, or more frequently if deemed necessary, the Company formally rates each portfolio investment on a scale of one to four. Each investment is assigned an initial rating of a “2” under the assumption that the investment is performing materially in-line with expectations. Any investment performing materially below our expectations would be downgraded from the “2” rating to a “3” or a “4” rating, based on the deterioration of the investment. An investment rating of a “4” could be moved to non-accrual status, and the final development could be an actual realization of a loss through a restructuring or impaired sale.
During the first quarter of 2015, the Company placed a portion of its second lien position in Edmentum, Inc. (“Edmentum”) on non-accrual status due to its ongoing restructuring, which was completed in June 2015. Post restructuring, the Company’s investments in Edmentum have been restored to full accrual status.
As of June 30, 2015, three portfolio companies had an investment rating of “3”, with a total cost basis of approximately $38.0 million and a fair value of approximately $26.3 million.
As of June 30, 2015, one portfolio company was on non-accrual status and had an investment rating of “4”. As of June 30, 2015, the investments in this portfolio company had an aggregate cost basis of approximately $1.6 million and an aggregate fair value of approximately $0.4 million.
Recent Developments
The Company has had approximately $123.7 million of originations and commitments in the first 35 days of the third quarter of 2015. This was offset by approximately $1.3 million of repayments and $10.9 million of sales during the same period.
On August 4, 2015, the Company’s board of directors declared a third quarter 2015 distribution of $0.34 per share payable on September 30, 2015 to holders of record as of September 16, 2015.
David Cordova has indicated that he will be resigning from his position as CFO and Treasurer of NMFC for personal reasons, effective as of August 14, 2015. Mr. Cordova has indicated that he and his family will be relocating to the west coast to pursue a new venture and that his departure is not related to any disagreement with the management of NMFC. Melody Siu, the current Controller of NMFC, has agreed to step-in as interim CFO and Treasurer until a permanent replacement can be found. In addition, NMFC has already commenced the search for a replacement. Adam Weinstein, the current CFO of New Mountain Capital, and former CFO of NMFC will be actively involved in overseeing the finance department during the transition period and NMFC expects to utilize the full resources of New Mountain Capital during that time. Mr. Cordova adds, “I’d like to thank Steve, Rob, Adam and the rest of the New Mountain team for all of their support during my time at New Mountain. It is truly a pleasure working with such talented individuals and I look forward to following their future accomplishments.” Mr. Hamwee, the CEO of NMFC expresses his gratitude and appreciation for Mr. Cordova’s service to NMFC and he, on behalf of NMFC’s full board of directors and management team wish Mr. Cordova continued success.
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1 Includes collateral for securities purchased under collateralized agreements to resell of $30.0 million.
2 References to “Yield to Maturity at Cost” assume the accruing investments in our portfolio as of a certain date, the ‘‘Portfolio Date’’, are purchased at adjusted cost (estimated) on that date and held until their respective maturities with no prepayments or losses and are exited at par at maturity. This calculation excludes the impact of existing leverage. Yield to Maturity at Cost uses the London Interbank Offered Rate (“LIBOR”) curves at each quarter’s respective end date. The actual yield to maturity may be higher or lower due to the future selection of LIBOR contracts by the individual companies in the Company’s portfolio or other factors.
3 Excludes revolving credit facilities, payment-in-kind (“PIK”) interest, bridge loans and return of capital.
4 Excludes an approximate $0.4 million reclassification from cash to PIK interest income from the three months ended March 31, 2015.
5 Under GAAP, the Company’s IPO did not step-up the cost basis of New Mountain Finance Holdings, L.L.C.’s (the “Predecessor Operating Company” or “NMF Holdings”) existing investments to fair market value at the IPO date. Since the total value of the Predecessor Operating Company’s investments at the time of the IPO was greater than the investments’ cost basis, a larger amount of amortization of purchase or original issue discount, as well as different amounts in realized gain and unrealized appreciation, may be recognized under GAAP in each period than if the step-up had occurred. This will remain until such predecessor investments are sold or mature in the future. The Company tracks the transferred (or fair market) value of each of its investments as of the time of the IPO and, for purposes of the incentive fee calculation, adjusts Pre-Incentive Fee Net Investment Income to reflect the amortization of purchase or original issue discount on the Company’s investments as if each investment was purchased at the date of the IPO, or stepped up to fair market value. This is defined as “Pre-Incentive Fee Adjusted Net Investment Income”. The Company also uses the transferred (or fair market) value of each of its investments as of the time of the IPO to adjust capital gains and losses (“Adjusted Realized Capital Gains (Losses)”) and unrealized capital appreciation and depreciation (“Adjusted Unrealized Capital Appreciation (Depreciation)”).
Conference Call
New Mountain Finance Corporation will host a conference call at 10 a.m. Eastern Time on Thursday, August 6, 2015, to discuss its second quarter 2015 financial results. All interested parties may participate in the conference call by dialing +1 (877) 443-9109 approximately 15 minutes prior to the call. International callers should dial +1 (412) 317-1082. This conference call will also be broadcast live over the Internet and can be accessed by all interested parties through the Company's website, http://ir.newmountainfinance.com. To listen to the live call, please go to the Company's website at least 15 minutes prior to the start of the call to register and download any necessary audio software. Following the call, you may access a replay of the event via audio webcast on our website. We will be utilizing a presentation during the conference call and we have posted the presentation to the investor relations section of our website.
Financial Statements and Tables of the Company
| New Mountain Finance Corporation | ||||||||||||||
| Consolidated Statements of Assets and Liabilities | ||||||||||||||
| (in thousands, except shares and per share data) | ||||||||||||||
| (unaudited) | ||||||||||||||
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June 30, 2015 | December 31, 2014 | ||||||||||||
| Assets | ||||||||||||||
| Investments at fair value | ||||||||||||||
|
Non-controlled/non-affiliated investments (cost of $1,181,684 and $1,422,891, respectively) |
$ | 1,172,100 | $ | 1,402,210 | ||||||||||
| Non-controlled/affiliated investments (cost of $90,001 and $23,000, respectively) | 89,601 | 22,461 | ||||||||||||
| Controlled investments (cost of $40,437 and $0, respectively) | 47,171 | –– | ||||||||||||
| Total investments at fair value (cost of $1,312,122 and $1,445,891, respectively) | 1,308,872 | 1,424,671 | ||||||||||||
| Securities purchased under collateralized agreements to resell | 30,000 | 30,000 | ||||||||||||
| Cash and cash equivalents | 24,226 | 23,445 | ||||||||||||
|
Deferred financing costs (net of accumulated amortization of $7,286
and
$5,867, respectively) |
13,994 | 14,052 | ||||||||||||
| Interest and dividend receivable | 11,456 | 11,744 | ||||||||||||
| Receivable from affiliates | 362 | 490 | ||||||||||||
| Receivable from unsettled securities sold | –– | 8,912 | ||||||||||||
| Other assets | 3,191 | 1,606 | ||||||||||||
| Total assets | $ | 1,392,101 | $ | 1,514,920 | ||||||||||
| Liabilities | ||||||||||||||
| Holdings Credit Facility | $ | 359,858 | $ | 468,108 | ||||||||||
| Convertible Notes | 115,000 | 115,000 | ||||||||||||
| SBA-guaranteed debentures | 55,000 | 37,500 | ||||||||||||
| NMFC Credit Facility | 38,000 | 50,000 | ||||||||||||
| Incentive fee payable | 5,057 | 4,803 | ||||||||||||
| Management fee payable | 4,951 | 5,144 | ||||||||||||
| Interest payable | 1,360 | 1,352 | ||||||||||||
| Deferred tax liability | 1,129 | 493 | ||||||||||||
| Capital gains incentive fee payable | 490 | –– | ||||||||||||
| Payable to affiliates | 460 | 822 | ||||||||||||
| Payable for unsettled securities purchased | –– | 26,460 | ||||||||||||
| Other liabilities | 2,470 | 3,068 | ||||||||||||
| Total liabilities | $ | 583,775 | $ | 712,750 | ||||||||||
| Commitments and contingencies | ||||||||||||||
| Net Assets | ||||||||||||||
|
Preferred stock, par value $0.01 per share, 2,000,000 shares
authorized, none issued |
–– | –– | ||||||||||||
|
Common stock, par value $0.01 per share 100,000,000 shares authorized, and 58,161,821 and 57,997,890 shares issued and outstanding, respectively |
582 | 580 | ||||||||||||
| Paid in capital in excess of par | 819,570 | 817,129 | ||||||||||||
| Accumulated undistributed net investment income | 2,380 | 2,530 | ||||||||||||
| Accumulated undistributed net realized gains on investments | 660 | 14,131 | ||||||||||||
|
Net unrealized (depreciation) appreciation of investments (net of provision for taxes of $1,129 and $493, respectively) |
(14,866 | ) | (32,200 | ) | ||||||||||
| Total net assets | $ | 808,326 | $ | 802,170 | ||||||||||
| Total liabilities and net assets | $ | 1,392,101 | $ | 1,514,920 | ||||||||||
| Number of shares outstanding | 58,161,821 | 57,997,890 | ||||||||||||
| Net asset value per share | $ | 13.90 | $ | 13.83 | ||||||||||
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New Mountain Finance Corporation |
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| Consolidated Statements of Operations | ||||||||||||||||||||||||||
| (in thousands, except shares and per share data) | ||||||||||||||||||||||||||
| (unaudited) | ||||||||||||||||||||||||||
| Three months ended | Six months ended | |||||||||||||||||||||||||
| June 30, 2015 | June 30, 2014 | June 30, 2015 | June 30, 2014 | |||||||||||||||||||||||
| Investment income (1) | ||||||||||||||||||||||||||
| From non-controlled/non-affiliated investments: | ||||||||||||||||||||||||||
| Interest income | $ | 33,767 | $ | 18,788 | $ | 65,621 | $ | 18,788 | ||||||||||||||||||
| Dividend income | 201 | 972 | 102 | 972 | ||||||||||||||||||||||
| Other income | 320 | 705 | 1,877 | 705 | ||||||||||||||||||||||
| From non-controlled/affiliated investments: | ||||||||||||||||||||||||||
| Interest income | 1,183 | –– | 2,226 | –– | ||||||||||||||||||||||
| Dividend income | 951 | –– | 1,809 | –– | ||||||||||||||||||||||
| Other income | 308 | 4 | 622 | 4 | ||||||||||||||||||||||
| From controlled investments: | ||||||||||||||||||||||||||
| Interest income | 520 | –– | 970 | –– | ||||||||||||||||||||||
| Dividend income | 643 | –– | 1,191 | –– | ||||||||||||||||||||||
| Other income | 12 | –– | 23 | –– | ||||||||||||||||||||||
| Investment income allocated from New Mountain Finance Holdings, L.L.C. (2) | ||||||||||||||||||||||||||
| Interest income | –– | 12,847 | –– | 40,515 | ||||||||||||||||||||||
| Dividend income | –– | 279 | –– | 2,368 | ||||||||||||||||||||||
| Other income | –– | 113 | –– | 795 | ||||||||||||||||||||||
| Total investment income | 37,905 | 33,708 | 74,441 | 64,147 | ||||||||||||||||||||||
| Expenses | ||||||||||||||||||||||||||
| Incentive fee (1) | 5,057 | 2,747 | 9,935 | 2,747 | ||||||||||||||||||||||
| Capital gains incentive fee (1) | 9 | 763 | 490 | 763 | ||||||||||||||||||||||
| Total incentive fees (1) | 5,066 | 3,510 | 10,425 | 3,510 | ||||||||||||||||||||||
| Management fee (1) | 6,198 | 2,742 | 12,666 | 2,742 | ||||||||||||||||||||||
| Interest and other financing expenses (1) | 5,598 | 2,559 | 11,075 | 2,559 | ||||||||||||||||||||||
| Professional fees (1) | 909 | 640 | 1,648 | 640 | ||||||||||||||||||||||
| Administrative expenses (1) | 522 | 360 | 1,157 | 360 | ||||||||||||||||||||||
| Other general and administrative expenses (1) | 453 | 239 | 882 | 239 | ||||||||||||||||||||||
| Net expenses allocated from New Mountain Finance Holdings, L.L.C. (2) | –– | 6,427 | –– | 20,808 | ||||||||||||||||||||||
| Total expenses | 18,746 | 16,477 | 37,853 | 30,858 | ||||||||||||||||||||||
| Less: management fee waived (1) | (1,247 | ) | –– | (2,629 | ) | –– | ||||||||||||||||||||
| Less: expenses waived and reimbursed (1) | –– | (58 | ) | (400 | ) | (58 | ) | |||||||||||||||||||
| Net expenses | 17,499 | 16,419 | 34,824 | 30,800 | ||||||||||||||||||||||
| Net investment income before income taxes | 20,406 | 17,289 | 39,617 | 33,347 | ||||||||||||||||||||||
| Income tax expense (1) | 153 | –– | 302 | –– | ||||||||||||||||||||||
| Net investment income | 20,253 | 17,289 | 39,315 | 33,347 | ||||||||||||||||||||||
| Net realized (losses) gains: | ||||||||||||||||||||||||||
| Non-controlled/non-affiliated investments(1) | (13,338 | ) | (1,067 | ) | (13,471 | ) | (1,067 | ) | ||||||||||||||||||
| Investments allocated from New Mountain Finance Holdings, L.L.C. (2) | –– | 5,860 | –– | 8,568 | ||||||||||||||||||||||
| Net change in unrealized appreciation (depreciation): | ||||||||||||||||||||||||||
| Non-controlled/non-affiliated investments(1) | 11,970 | 5,708 | 10,508 | 5,708 | ||||||||||||||||||||||
| Non-controlled/affiliated investments(1) | 1,600 | –– | 728 | –– | ||||||||||||||||||||||
| Controlled investments (1) | (86 | ) | –– | 6,734 | –– | |||||||||||||||||||||
| Investments allocated from New Mountain Finance Holdings, L.L.C. (2) | –– | (3,742 | ) | –– | 940 | |||||||||||||||||||||
| Provision for taxes (1) | (135 | ) | (386 | ) | (636 | ) | (386 | ) | ||||||||||||||||||
| Net increase in net assets resulting from operations | $ | 20,264 | $ | 23,662 | $ | 43,178 | $ | 47,110 | ||||||||||||||||||
| Basic earnings per share | $ | 0.35 | $ | 0.46 | $ | 0.74 | $ | 0.95 | ||||||||||||||||||
| Weighted average shares of common stock outstanding-basic | 58,076,552 | 51,595,684 | 58,037,868 | 49,343,462 | ||||||||||||||||||||||
| Diluted earnings per share | $ | 0.33 | $ | 0.44 | $ | 0.70 | $ | 0.94 | ||||||||||||||||||
| Weighted average shares of common stock outstanding-diluted | 65,313,497 | 54,292,924 | 65,265,931 | 50,699,533 | ||||||||||||||||||||||
| Dividends declared and paid per share | $ | 0.34 | $ | 0.34 | $ | 0.68 | $ | 0.68 | ||||||||||||||||||
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(1) For the three and six months ended June 30, 2014, the amounts reported relate to the period from May 8, 2014 to June 30, 2014.
(2) For the three and six months ended June 30, 2014, the amounts reported relate to the period from April 1, 2014 to May 7, 2014 and January 1, 2014 to May 7, 2014, respectively.
| New Mountain Finance Corporation Reconciliation of Adjusted Net Investment Income | ||||||||||||||||||||
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(in millions, except for per share data) |
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(unaudited) |
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Three months ended
June 30, 2015 |
Six months ended
June 30, 2015 |
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| Amount |
Per Weighted Average Share |
Amount |
Per Weighted Average Share |
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| GAAP net investment income ("NII") | $ | 20.3 | $ | 0.35 | $ | 39.3 | $ | 0.68 | ||||||||||||
| Non-cash capital gains incentive fee(1) (2) | (0.1) | (0.00) | 0.4 | 0.01 | ||||||||||||||||
| Adjusted NII | $ | 20.2 | $ | 0.35 | $ | 39.7 | $ | 0.69 | ||||||||||||
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(1) Reclassification of the non-cash capital gains incentive fee out of net investment income and into net increase in net assets resulting from operations.
(2) Net of non-cash amortization adjustment of less than $0.1 million for the three and six months ended June 30, 2015
|
New Mountain Finance Corporation Adjusted Net Investment Income (in millions, except per share data) (unaudited, numbers may not add due to rounding) |
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|
Three months ended June 30, 2015 |
Six months ended June 30, 2015 |
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| Investment income | ||||||||||||
| Interest income | $ | 35.5 | $ | 68.8 | ||||||||
| Dividend income | 1.8 | 3.1 | ||||||||||
| Other income | 0.6 | 2.5 | ||||||||||
| Total investment income | 37.9 | 74.4 | ||||||||||
| Expenses | ||||||||||||
| Management fee | 6.2 | 12.7 | ||||||||||
| Incentive fee | 5.0 | 9.9 | ||||||||||
| Interest and other financing expenses | 5.6 | 11.1 | ||||||||||
| Professional fees | 0.9 | 1.6 | ||||||||||
| Administrative expenses | 0.6 | 1.2 | ||||||||||
| Other general and administrative expenses | 0.5 | 0.9 | ||||||||||
| Total expenses | 18.8 | 37.4 | ||||||||||
| Less: management fee waived | (1.2) | (2.6) | ||||||||||
| Less: expenses waived and reimbursed | –– | (0.4) | ||||||||||
| Net expenses | 17.6 | 34.4 | ||||||||||
| Net investment income before income taxes | 20.3 | 40.0 | ||||||||||
| Income tax expense | 0.1 | 0.3 | ||||||||||
| Net investment income (“NII”) | 20.2 | 39.7 | ||||||||||
| Net realized losses on investments | (13.4) | (13.5) | ||||||||||
| Net change in unrealized appreciation of investments | 13.6 | 18.1 | ||||||||||
| Provision for taxes | (0.1) | (0.6) | ||||||||||
| Capital gains incentive fee | (0.0) | (0.5) | ||||||||||
| Net increase in net assets resulting from operations | $ | 20.3 | $ | 43.2 | ||||||||
| Adjusted NII per weighted average share | $ | 0.35 | $ | 0.69 | ||||||||
ABOUT NEW MOUNTAIN FINANCE CORPORATION
New Mountain Finance Corporation is a closed-end, non-diversified and externally managed investment company that has elected to be regulated as a business development company under the Investment Company Act of 1940, as amended. The Company’s investment objective is to generate current income and capital appreciation through the sourcing and origination of debt securities at all levels of the capital structure, including first and second lien debt, notes, bonds and mezzanine securities. In some cases, the investments may also include small equity interests. The Company’s investment activities are managed by its Investment Adviser, New Mountain Finance Advisers BDC, L.L.C., which is an investment adviser registered under the Investment Advisers Act of 1940, as amended. More information about New Mountain Finance Corporation can be found on the Company’s website at http://www.newmountainfinance.com.
ABOUT NEW MOUNTAIN CAPITAL, L.LC.
New Mountain Capital, L.L.C is a New York-based private equity firm investing for long-term capital appreciation through direct investments in growth equity transactions, leveraged acquisitions, and management buyouts. The firm currently manages private and public equity funds with more than $15.0 billion in aggregate capital commitments. New Mountain Capital, L.L.C. seeks out the highest-quality defensive growth leaders in carefully selected industry sectors and then works intensively with management to build the value of these companies. For more information on New Mountain Capital, L.L.C., please visit www.newmountaincapital.com.
FORWARD-LOOKING STATEMENTS
Statements included herein may contain “forward-looking statements”, which relate to our future operations, future performance or our financial condition. Forward-looking statements are not guarantees of future performance, condition or results and involve a number of risks and uncertainties. Actual results and outcomes may differ materially from those anticipated in the forward-looking statements as a result of a variety of factors, including those described from time to time in our filings with the Securities and Exchange Commission or factors that are beyond our control. New Mountain Finance Corporation undertakes no obligation to publicly update or revise any forward-looking statements made herein. All forward-looking statements speak only as of the time of this press release.
View source version on businesswire.com: http://www.businesswire.com/news/home/20150805006689/en/
New Mountain Finance Corporation
David M. Cordova, (212) 220-3546
Chief
Financial Officer and Treasurer
Source: New Mountain Finance Corporation
Released August 5, 2015