Eagle Point Credit Company Inc. Announces First Quarter 2023 Financial Results
23 Mai 2023 - 2:00PM
Business Wire
Eagle Point Credit Company Inc. (the “Company”) (NYSE: ECC,
ECCC, ECC PRD, ECCV, ECCW, ECCX) today announced financial results
for the quarter ended March 31, 2023 and certain additional
activity through April 30, 2023.
“Our portfolio continued to generate strong cash flows while
maintaining a stable NAV despite the increasingly challenging macro
environment and recent banking turmoil,” said Thomas Majewski,
Chief Executive Officer. “During the quarter, we targeted
discounted opportunities in the secondary market and deployed $55
million of net capital into investments that we believe will
generate attractive risk-adjusted returns. For the first quarter,
we generated net investment income, less realized capital losses,
of $0.32 per share. We also strengthened our balance sheet in the
quarter by utilizing our ‘at-the-market’ program to issue over $27
million of common stock at a premium to NAV. With 100% fixed-rate
financing and no maturities prior to 2028, our balance sheet has
served us well as interest rates moved up and remains protected
against any further rise in interest rates.”
FIRST QUARTER 2023 RESULTS
- Net asset value (“NAV”) per common share of $9.10 as of March
31, 2023, compared to $9.07 as of December 31, 2022.
- Net investment income (“NII”) and realized capital losses of
$0.32 per weighted average common share.1,2 This is an increase
both from $0.29 of NII and realized capital losses per weighted
average common share for the quarter ended December 31, 2022, and
$0.30 of NII and realized capital losses per weighted average
common share for the quarter ended March 31, 2022.
- GAAP net income (inclusive of unrealized mark-to-market gains)
of $20.1 million, or $0.35 per weighted average common share.
- Received $42.3 million in recurring cash distributions3 from
the Company’s investment portfolio, or $0.74 per weighted average
common share, which was in excess of the Company’s aggregate
distributions on its common stock and operating costs for the
quarter.
- Deployed $55.3 million in net capital into collateralized loan
obligation (“CLO”) equity, CLO debt, loan accumulation facilities
and other investments. The weighted average effective yield of new
CLO equity investments made by the Company during the quarter,
which includes a provision for credit losses, was 18.6% as measured
at the time of investment.
- As of March 31, 2023:
- The weighted average effective yield of the Company’s CLO
equity portfolio (excluding called CLOs), based on amortized cost,
was 15.83%. This compares to 16.23% as of December 31, 2022 and
16.78% as of March 31, 2022.4
- The weighted average expected yield of the Company’s CLO equity
portfolio (excluding called CLOs), based on fair market value, was
25.96%. This compares to 27.86% as of December 31, 2022 and 20.06%
as of March 31, 2022.
- Issued 2.6 million shares of common stock and 2,308 shares of
Series D Preferred Stock pursuant to the Company’s “at-the-market”
offering program for total net proceeds of approximately $27.2
million. The common stock issuance resulted in $0.05 per share of
NAV accretion for the quarter ended March 31, 2023.
- As of March 31, 2023, the Company had debt and preferred equity
securities outstanding which totaled approximately 33.4% of its
total assets (less current liabilities).5
- As of March 31, 2023, on a look-through basis, and based on the
most recent CLO trustee reports received by such date:
- The Company had indirect exposure to approximately 1,872 unique
corporate obligors.
- The largest look-through obligor represented 0.9% of the loans
underlying the Company’s CLO equity portfolio.
- The top-ten largest look-through obligors together represented
6.3% of the loans underlying the Company’s CLO equity
portfolio.
- The look-through weighted average spread of the loans
underlying the Company’s CLO equity portfolio was 3.67% as of March
2023, an increase of four basis points from 3.63% as of December
2022.
- GAAP net income was comprised of total investment income of
$31.9 million and total net unrealized appreciation on investments
of $7.0 million, offset by net unrealized appreciation on certain
liabilities held at fair value of $5.2 million, realized capital
losses of $1.1 million, financing costs and operating expenses of
$12.5 million.
SECOND QUARTER 2023 PORTFOLIO ACTIVITY THROUGH APRIL 30, 2023
AND OTHER UPDATES
- NAV per common share is estimated to be between $8.83 and $8.93
as of April 30, 2023.
- Received $51.4 million of recurring cash distributions from the
Company’s investment portfolio. This reflects an increase of 22%
from the first quarter. As of April 30, 2023, some of the Company’s
investments had not yet reached their payment date for the
quarter.
- Deployed $8.8 million of capital into CLO equity and loan
accumulation facilities.
DISTRIBUTIONS
As previously announced, the Company has declared the following
monthly distributions to its common stock, 6.50% Series C Term
Preferred Stock due 2031 (the “Series C Term Preferred Stock”) and
6.75% Series D Preferred Stock (the “Series D Preferred
Stock”).6
Security
Amount per Share
Record Dates
Payable Dates
Common Stock Regular
$0.14
May 11, 2023,
June 12, 2023,
July 11, 2023,
August 11, 2023,
September 11, 2023
May 31, 2023
June 30, 2023,
July 31, 2023,
August 31, 2023,
September 29, 2023
Common Stock Supplemental
$0.02
Series C Term Preferred Stock
$0.135417
Series D Preferred Stock
$0.140625
CONFERENCE CALL
The Company will host a conference call at 10:00 a.m. (Eastern
Time) today to discuss the Company’s financial results for the
quarter ended March 31, 2023, as well as a portfolio update.
All interested parties may participate in the conference call by
dialing (877) 407-0789 (toll-free) or (201) 689-8562
(international), and referencing Conference ID 13737409
approximately 10 to 15 minutes prior to the call.
A live webcast will also be available on the Company’s website
(www.eaglepointcreditcompany.com).
Please go to the Investor Relations section at least 15 minutes
prior to the call to register, download and install any necessary
audio software.
An archived replay of the call will be available shortly
afterwards until June 23, 2023. To hear the replay, please dial
(844) 512-2921 (toll-free) or (412) 317-6671 (international). For
the replay, enter Conference ID 13737409.
ADDITIONAL INFORMATION
The Company has made available on the investor relations section
of its website, www.eaglepointcreditcompany.com (in the financial
statements and reports section), its unaudited consolidated
financial statements as of and for the period ended March 31, 2023.
The Company has also filed this report with the Securities and
Exchange Commission. The Company also published on its website (in
the presentations and events section) an investor presentation,
which contains additional information about the Company and its
portfolio as of and for the quarter ended March 31, 2023.
ABOUT EAGLE POINT CREDIT COMPANY
The Company is a non-diversified, closed-end management
investment company. The Company’s primary investment objective is
to generate high current income, with a secondary objective to
generate capital appreciation, primarily by investing in equity and
junior debt tranches of collateralized loan obligations. The
Company is externally managed and advised by Eagle Point Credit
Management LLC.
The Company makes certain unaudited portfolio information
available each month on its website in addition to making certain
other unaudited financial information available on its website
(www.eaglepointcreditcompany.com). This information includes (1) an
estimated range of the Company’s net investment income (“NII”) and
realized capital gains or losses per share of common stock for each
calendar quarter end, generally made available within the first
fifteen days after the applicable calendar month end, (2) an
estimated range of the Company’s NAV per share of common stock for
the prior month end and certain additional portfolio-level
information, generally made available within the first fifteen days
after the applicable calendar month end and (3) during the latter
part of each month, an updated estimate of NAV, if applicable, and,
with respect to each calendar quarter end, an updated estimate of
the Company’s NII and realized capital gains or losses per share
for the applicable quarter, if available.
FORWARD-LOOKING STATEMENTS
This press release may contain “forward-looking statements”
within the meaning of the Private Securities Litigation Reform Act
of 1995. Statements other than statements of historical facts
included in this press release may constitute forward-looking
statements and are not guarantees of future performance or results
and involve a number of risks and uncertainties. Actual results may
differ materially from those in the forward-looking statements as a
result of a number of factors, including those described in the
Company’s filings with the U.S. Securities and Exchange Commission.
The Company undertakes no duty to update any forward-looking
statement made herein. All forward-looking statements speak only as
of the date of this press release.
1 “Per weighted average common share” is based on the average
daily number of shares of common stock outstanding for the period
and “per common share” refers to per share of the Company’s common
stock. 2 NII is net of distributions made on the Company’s Series D
Preferred Stock of $0.01 per weighted average common share. 3
“Recurring cash distributions” refers to the quarterly
distributions received by the Company from its CLO equity, CLO debt
and other investments and distributions from loan accumulation
facilities in excess of capital invested and excludes funds
received from CLOs called. 4 Weighted average effective yield is
based on an investment’s amortized cost whereas weighted average
expected yield is based on an investment’s fair market value as of
the applicable period end as disclosed in the Company’s financial
statements, which is subject to change from period to period.
Please refer to the Company’s quarterly unaudited financial
statements for additional disclosures. 5 Over the long-term,
management expects to operate the Company generally with leverage
within a range of 25% to 35% of total assets under normal market
conditions. Based on applicable market conditions at any given
time, or should significant opportunities present themselves, the
Company may incur leverage outside of this range, subject to
applicable regulatory limits. 6 The ability of the Company to
declare and pay distributions on stock are subject to a number of
factors, including the Company’s results of operations.
Distributions on stock are generally paid from net investment
income (regular interest and dividends) and may also include
capital gains and/or a return of capital. The specific tax
characteristics of the distributions will be reported to the
Company’s stockholders on Form 1099 after the end of the calendar
year.
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Investor and Media Relations: ICR 203-340-8510
IR@EaglePointCredit.com www.eaglepointcreditcompany.com
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