GREENWICH, Conn., Aug. 07, 2018 (GLOBE NEWSWIRE) -- Oxford Lane Capital Corp. (“Oxford Lane”, "Fund", “we”, “us” or “our”) (NasdaqGS: OXLC) (NasdaqGS: OXLCO) (NasdaqGS: OXLCM) announced today the following financial results and related information:
- Net asset value per share as of June 30, 2018, stood at $9.98 compared with a net asset value per share at March 31, 2018 of $10.08.
- Net investment income (“NII”), calculated in accordance with generally accepted accounting principles (“GAAP”), was approximately $11.5 million, or approximately $0.39 per share, for the quarter ended June 30, 2018.
- Our core net investment income (“Core NII”) was approximately $14.6 million, or approximately $0.50 per share, for the quarter ended June 30, 2018.
- Core NII represents net investment income adjusted for additional cash income distributions received, or entitled to be received (if any, in either case), on our collateralized loan obligation (“CLO”) equity investments (excluding those cash distributions believed to represent a return of capital). (See additional information under “Supplemental Information Regarding Core Net Investment Income” below).
- While our experience has been that cash flow distributions have historically represented useful indicators of our CLO equity investments’ annual taxable income during certain periods, we believe that current and future cash flow distributions may represent less accurate indicators of taxable income with respect to our CLO equity investments than they have in the past. Accordingly, our taxable income may be materially different than either NII or Core NII.
- Core NII represents net investment income adjusted for additional cash income distributions received, or entitled to be received (if any, in either case), on our collateralized loan obligation (“CLO”) equity investments (excluding those cash distributions believed to represent a return of capital). (See additional information under “Supplemental Information Regarding Core Net Investment Income” below).
- Total investment income, calculated in accordance with GAAP, amounted to approximately $21.2 million for the quarter ended June 30, 2018.
- For the quarter ended June 30, 2018, we recorded total investment income from our portfolio as follows:
- approximately $20.5 million from our CLO equity investments, and
- approximately $0.7 million from our CLO debt investments, and other income.
- approximately $20.5 million from our CLO equity investments, and
- For the quarter ended June 30, 2018, we recorded total investment income from our portfolio as follows:
- As of June 30, 2018, the following metrics applied (note that none of these values represent a total return to shareholders):
- the weighted average yield of our CLO debt investments at current cost was approximately 11.2%, compared with 10.9% as of March 31, 2018;
- the weighted average GAAP effective yield of our CLO equity investments at current cost was approximately 16.7%, compared with 17.2% as of March 31, 2018;
- the weighted average cash yield of our CLO equity investments at current cost was approximately 22.4%, compared with 17.3% as of March 31, 2018.
- the weighted average yield of our CLO debt investments at current cost was approximately 11.2%, compared with 10.9% as of March 31, 2018;
- Net increase in net assets from operations was approximately $8.1 million, or approximately $0.28 per share, for the quarter ended June 30, 2018, including:
- Net investment income of approximately $11.5 million;
- Net realized gains of approximately $0.7 million; and
- Net unrealized depreciation of approximately $4.1 million.
- Net investment income of approximately $11.5 million;
- During the quarter ended June 30, 2018, we made additional CLO investments of approximately $121.7 million and we received approximately $75.9 million from sales and repayments of our CLO investments.
- During the quarter ended June 30, 2018, we issued a total of 2,542,625 shares of common stock pursuant to an “at-the-market” offering, resulting in net proceeds of approximately $26.5 million after deducting the sales agent’s commissions and offering expenses.
- On July 23, 2018, we amended our repurchase transaction with Nomura Securities International, Inc. Under the amended agreement, the term of the facility was extended until April 2, 2019.
- On July 31, 2018, our board of directors declared the following distributions on our common stock:
| Month Ending | Record Date | Payment Date | Amount Per Share | |
| October 31, 2018 | October 24, 2018 | October 31, 2018 | $0.135 | |
| November 30, 2018 | November 23, 2018 | November 30, 2018 | $0.135 | |
| December 31, 2018 | December 24, 2018 | December 31, 2018 | $0.135 | |
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:
| Preferred Shares Type | Per Share Dividend Amount Declared | 2018 Record Dates | 2018 Payment Dates | |
| Series 2023 | $ | 0.156250 | September 21, October 24, November 23 | September 28, October 31, November 30 |
| Series 2024 | $ | 0.140625 | September 21, October 24, November 23 | September 28, October 31, November 30 |
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 6.75%, respectively, of the $25.00 per share liquidation preference, or $1.875 and $1.6875 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 6.75% 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 determined in accordance with GAAP. Our non-GAAP measures 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 income 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 adjustments”).
Further, in order to continue to qualify to be taxed as a regulated investment company, we are required, among other things, to distribute at least 90% of our investment company taxable income annually. Therefore, core net investment income may 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 these non-GAAP measures may not be useful indicators of taxable earnings, particularly during periods of market disruption and volatility and our taxable income may differ materially from our core net investment income.
The following table provides a reconciliation of NII to Core NII for the three months ended June 30, 2018:
| Three Months Ended | |||||
| June 30, 2018 | |||||
| Amount | Per Share | ||||
| Amount | |||||
| Net investment income | $ | 11,468,995 | $ | 0.391 | |
| CLO equity adjustments | 3,094,135 | 0.106 | |||
| Core net investment income | $ | 14,563,130 | $ | 0.497 | |
A presentation containing further detail regarding our quarterly results of operations has been posted to our website under the Investor Relations section at Oxford Lane Presentation.
We will host a conference call to discuss our first fiscal quarter results today – Tuesday, August 07, 2018, at 10:00 AM ET. The toll free dial-in number will be 1-844-792-3730. There will be a recorded replay of the call available for 30 days after the call. If you are interested in hearing the recording, please dial 1-877-344-7529. The replay pass-code number is 10123018.
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 risk-adjusted total return by investing in debt and equity tranches of CLO vehicles. CLO investments may also include warehouse facilities, which are financing structures intended to aggregate loans that may be used to form the basis of a CLO vehicle.
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