GREENWICH, CT--(Marketwired - Nov 16, 2016) - Oxford Lane Capital Corp. ("Oxford Lane", "Fund", "we", "us" or "our") (
- Net asset value per share as of September 30, 2016 stood at $9.94 compared with a net asset value per share at June 30, 2016 of $8.78.
- Net investment income, calculated in accordance with generally accepted accounting principles ("GAAP"), was approximately $7.0 million, or approximately $0.37 per share, for the quarter ended September 30, 2016.
- Our core net investment income ("Core NII") was approximately $13.6 million, or approximately $0.71 per share, for the quarter ended September 30, 2016.
- Core NII represents net investment income adjusted for additional cash distributions received, or entitled to be received (if any, in either case), on our CLO equity investments. ( See additional information under "Supplemental Information Regarding Core Net Investment Income" below ).
- Total investment income, calculated in accordance with GAAP, amounted to approximately $13.6 million for the quarter ended September 30, 2016.
- For the quarter ended September 30, 2016, we recorded GAAP investment income from our portfolio as follows:
- approximately $13.0 million from our CLO equity investments;
- approximately $0.3 million from our CLO debt investments; and
- approximately $0.3 million from all other sources.
- While our experience has been that cash flow distributions have historically represented useful indicators of our CLO equity investments' annual taxable income, we believe that current and future cash flow distributions may provide less useful indications as to the final determination of taxable income with respect to our CLO equity investments. In general, we currently expect our annual taxable income to be higher than our GAAP earnings for the current fiscal year.
- The weighted average yield of our CLO debt investments at current cost was approximately 8.9% as of September 30, 2016.
- The weighted average effective yield (GAAP) of our CLO equity investments at current cost was approximately 17.2% as of September 30, 2016.
- The weighted average cash yield of our CLO equity investments at current cost was approximately 26.1% as of September 30, 2016.
- For the quarter ended September 30, 2016, we recorded GAAP investment income from our portfolio as follows:
- Net increase in net assets from operations was approximately $32.6 million, or approximately $1.72 per share, for the quarter ended September 30, 2016, including:
- Net investment income of approximately $7.0 million;
- Net realized gains of approximately $0.9 million; and
- Net unrealized appreciation of approximately $24.7 million.
- During the quarter ended September 30, 2016, we made additional CLO equity investments of approximately $52.7 million.
- During the quarter ended September 30, 2016, we sold approximately $38.0 million of our CLO equity investments.
- During the quarter ended September 30, 2016, we issued a total of 951,645 shares of common stock pursuant to an "at the market" offering, resulting in net proceeds of approximately $10.6 million.
- Our Board of Directors declared a distribution for the quarter ending December 31, 2016 of $0.60 per common share.
- Record date is December 16, 2016
- Payable on December 30, 2016
Our Board of Directors has also declared the required monthly dividends on our Series 2023 Term Preferred Shares and Series 2024 Term Preferred Shares (each, a "Share"), as follows:
| Per Share Dividend Amount Declared | 2016 Record Dates | 2016 Payable Dates | ||||
| Series 2023 | $0.15625 | December 16, January 16, February 16 | December 30, January 31, February 28 | |||
| Series 2024 | $0.16930 | December 16, January 16, February 16 | December 30, January 31, February 28 | |||
In accordance with their terms, each of the Series 2023 Term Preferred Shares and Series 2024 Term Preferred Shares will pay a monthly dividend at a fixed rate of 7.50% and 8.125%, respectively, of the $25.00 per share liquidation preference, or $1.875 and $2.03125 per share per year, respectively. This fixed annual dividend rate is subject to adjustment under certain circumstances, but will not in any case be lower than 7.50% and 8.125% per year, respectively, for each of the Series 2023 Term Preferred Shares and Series 2024 Term Preferred Shares.
Supplemental Information Regarding Core Net Investment Income On a supplemental basis, we provide information relating to core net investment income, which is a non-GAAP measure. This measure is provided in addition to, but not as a substitute for, net investment income. Our non-GAAP measure may differ from similar measures by other companies, even if similar terms are used to identify such measures. Core net investment income represents net investment income adjusted for additional cash distributions received, or entitled to be received (if any, in either case), on our CLO equity investments.
Income from investments in the "equity" class securities of CLO vehicles, for GAAP purposes, is recorded using the effective interest method based upon an effective yield to the expected redemption utilizing estimated cash flows, compared to the cost resulting in an effective yield for the investment; the difference between the actual cash received or distributions entitled to be received and the effective yield calculation is an adjustment to cost. Accordingly, investment income recognized on CLO equity securities in the GAAP statement of operations differs from the cash distributions actually received by us during the period (referred to below as "CLO equity additional distributions").
Further, in order to continue to qualify to be taxed as a regulated investment company ("RIC"), we are required, among other things, to distribute at least 90% of our investment company taxable income annually. Therefore, core net investment income may, for certain periods, provide a better indication of estimated taxable income for a reporting period than does GAAP net investment income, although we can offer no assurance that will be the case as the ultimate tax character of our earnings cannot be determined until tax returns are prepared after the end of a fiscal year. We note that this non-GAAP measure may not be a useful indicator of taxable earnings, particularly during periods of market disruption and volatility.
The following table provides a reconciliation of net investment income to Core NII for the three months ended September 30, 2016:
| Three Months Ended September 30, 2016 | ||||||
| Amount | Per Share Amounts | |||||
| Net investment income | $ | 6,976,700 | $ | 0.367 | ||
| CLO equity additional distributions | 6,596,161 | 0.346 | ||||
| Core net investment income | $ | 13,572,861 | $ | 0.713 | ||
A presentation containing further detail regarding our quarterly results of operations has been posted to our website under the Investor Relations section at oxfordlanepresentation
We will host a conference call to discuss our second fiscal quarter results today, Wednesday, November 16, 2016 at 10:00 AM. Please call 1-844-792-3730 to participate. A replay of the call will be available for 30 days. If you are interested in hearing the replay, please dial 1-877-344-7529. The replay passcode is 10096682.
About Oxford Lane Capital Corp. Oxford Lane Capital Corp. is a publicly-traded registered closed-end management investment company. It currently seeks to achieve its investment objective of maximizing total return by investing in securitization vehicles which, in turn, primarily invest in senior secured loans made to companies whose debt is unrated or is rated below investment grade.
Forward-Looking Statements This press release contains forward-looking statements subject to the inherent uncertainties in predicting future results and conditions. Any statements that are not statements of historical fact (including statements containing the words "believes," "plans," "anticipates," "expects," "estimates" and similar expressions) should also be considered to be forward-looking statements. Certain factors could cause actual results and conditions to differ materially from those projected in these forward-looking statements. These factors are identified from time to time in our filings with the Securities and Exchange Commission. We undertake no obligation to update such statements to reflect subsequent events, unless required to do so by law.
Contact: Bruce Rubin 203-983-5280
