SOURCE: TICC Capital Corp.

May 05, 2011 08:00 ET

TICC Announces Results of Operations for the Quarter Ended March 31, 2011 and Quarterly Distribution of $0.25 per Share

GREENWICH, CT--(Marketwire - May 5, 2011) - TICC Capital Corp. (NASDAQ: TICC) announced today its financial results for the quarter ended March 31, 2011 and a distribution of $0.25 per share for the second quarter of 2011.

HIGHLIGHTS

--  Total investment income for the first quarter of 2011 amounted to
    approximately $9.8 million, up approximately 6.8% from the fourth
    quarter of 2010 due largely to greater distribution income from our
    securitization vehicle investments.

--  For the quarter ended March 31, 2011, we recorded net investment income
    of approximately $0.5 million, or approximately $0.02 per share.
    Excluding the impact of a capital gains incentive fee expense of
    approximately $6.5 million, our core net investment income(1) was
    approximately $7.0 million, or approximately $0.22 per share.  We also
    recorded net unrealized appreciation of approximately $9.1 million and
    net realized capital gains of approximately $1.9 million.  In total, we
    had a net increase in net assets resulting from operations of
    approximately $0.36 per share for the first quarter, or approximately
    $0.56 per share of core net increase in net assets resulting from
    operations(1).

--  Operating expenses for the quarter ended March 31, 2011 were
    approximately $2.7 million, which were up slightly from the fourth
    quarter of 2010.

--  During the quarter ended March 31, 2011, we recorded net unrealized
    appreciation of approximately $9.1 million, comprised of $13.3 million
    in gross unrealized appreciation, $2.7 million in gross unrealized
    depreciation and $1.5 million relating to the reversal of prior period
    net unrealized appreciation upon the realization events associated with
    certain investments.

    --  Our weighted average credit rating on a fair value basis was 2.2 at
        the end of the first quarter of 2011.

--  For the quarter ended March 31, 2011, we had net realized gains on
    investments of approximately $1.9 million due to sales and repayments
    of several investments.

--  The capital gains portion of our incentive fee expense was
    approximately $6.5 million for the quarter ended March 31, 2011
    compared to zero for the prior quarter.  The capital gains incentive
    fee expense, as reported under generally accepted accounting
    principles, is calculated on the basis of net realized gains and net
    unrealized appreciation at the end of each period.  The amount of
    capital gains incentive fee expense related to the hypothetical
    liquidation of the portfolio (and assuming no other changes in realized
    or unrealized gains and losses) would only become payable to the
    Investment Advisor in the event of a complete liquidation of our
    portfolio as of period end and the termination of the Investment
    Advisory Agreement (the "Agreement") on such date.  The $6.5 million
    capital gains incentive fee expense, and associated accrual, for the
    first quarter of 2011 relates entirely to the hypothetical liquidation
    calculation.  Also, it should be noted that the capital gains incentive
    fee expense fluctuates with our overall investment results.

    The amount of the capital gains incentive fee which will actually be
    payable is determined in accordance with the terms of the Agreement and
    is calculated as of the end of each calendar year (or upon termination
    of the Agreement).  The terms of the Agreement state that the capital
    gains incentive fee calculation is based on net realized gains, if any,
    offset by gross unrealized depreciation for the calendar year.  No
    effect is given to gross unrealized appreciation.

--  Our Board of Directors has declared a distribution of $0.25 per share
    for the second quarter of 2011.

    --  Payable Date: June 30, 2011

    --  Record Date: June 16, 2011

--  During the first quarter of 2011, we deployed approximately
    $100.6 million in 23 investments.  For the same period, we received
    proceeds of approximately $66.2 million from repayments, sales and
    amortization payments on our debt investments.

--  With respect to our CLO investments for the quarter ending March 31,
    2011, we recorded approximately $980,000 in interest payments, $427,000
    in principal payments at par and approximately $2.3 million in CLO
    equity distributions.  In total, since we began investing in this asset
    class through March 31, 2011, we have recorded approximately
    $4.0 million in interest payments, $2.5 million in principal payments
    at par and $6.1 million in CLO equity distributions.

    --  At the end of the first quarter, this asset class represented
        approximately 29.8% of our total assets on a fair value basis,
        partially due to significant appreciation in the values of these
        assets since we purchased them.

--  At March 31, 2011, the weighted average yield of our debt investments
    was approximately 13.3%, down from 14.1% at December 31, 2010.

    --  As of the end of the first quarter of 2011 there were no loans on
        non-accrual status.

--  At March 31, 2011, net asset value per share was $9.97 compared with
    the net asset value per share at December 31, 2010 of $9.85.
    The March 31, 2011 net asset value incorporates the impact of the
    capital gains incentive fee accrual.

(1) Supplemental Information Regarding Core Net Investment Income and Core Net Increase in Net Assets Resulting from Operations

On a supplemental basis, we provide information relating to core net investment income and core net increase in net assets resulting from operations, non-GAAP measures. These measures are provided in addition to, but not a substitute for, net investment income and net increase in net assets resulting from operations. Core net investment income represents net investment income excluding our capital gains incentive fee. Core net increase in net assets resulting from operations represents net increase in net assets resulting from operations excluding the capital gains incentive fee. As the capital gains incentive fee is based on a hypothetical event that did not occur, we believe that core net investment income and core net increase in net assets resulting from operations are useful indicators of non-hypothetical transactions during this period.

The following table provides a reconciliation of net investment income to core net investment income (for the three months ended March 31, 2011):

                                                                 Per Share
                                                  Amount          Amounts
                                               ------------    ------------
Net investment income                          $    548,023    $       0.02
Capital gains incentive fee                       6,469,329            0.20
                                               ------------    ------------
Core net investment income                     $  7,017,352    $       0.22
                                               ============    ============

The following table provides a reconciliation of net increase in net assets resulting from operations to core net increase in net assets resulting from operations (for the three months ended March 31, 2011):

                                                                 Per Share
                                                  Amount          Amounts
                                               ------------    ------------
Net increase in net assets resulting from
 operations                                    $ 11,559,642    $       0.36
Capital gains incentive fee                       6,469,329            0.20
                                               ------------    ------------
Core net increase in net assets resulting
 from operations                               $ 18,028,971    $       0.56
                                               ============    ============

We will host a conference call to discuss our first quarter results today, Thursday, May 5 at 10:00 AM ET. Please call 877-317-6789 to participate. A replay of the conference call will be available for approximately 30 days. The replay number is 877-344-7529, and the replay passcode is 450716.

The following financial statements are unaudited and without footnotes. Readers who would like additional information should obtain our Form 10-K for the period ended December 31, 2010, and subsequent reports on Form 10-Q as they are filed.



TICC CAPITAL CORP.

STATEMENTS OF ASSETS AND LIABILITIES (UNAUDITED)


                                                March 31,    December 31,
                                                  2011           2010
                                              -------------  -------------

ASSETS
    Investments, at fair value (cost:
     $263,710,562 @ 3/31/11; $226,200,687
     @ 12/31/10)
      Non-affiliated/non-control investments
       (cost: $245,640,753 @ 3/31/11;
       $206,750,687 @ 12/31/10)               $ 276,311,788  $ 229,385,715
      Control investments (cost: $18,069,809
       @ 3/31/11; $19,450,000 @ 12/31/10)        17,850,000     18,150,000
                                              -------------  -------------
        Total investments at fair value         294,161,788    247,535,715
                                              -------------  -------------
    Cash and cash equivalents                    33,606,034     68,780,866
    Interest receivable                           2,120,593      1,488,984
    Distributions receivable from
     securitization vehicles                        537,441              -
    Prepaid expenses and other assets               115,570         94,518
                                              -------------  -------------
           Total assets                       $ 330,541,426  $ 317,900,083
                                              =============  =============

LIABILITIES
    Investment advisory fee payable to
     affiliate                                $   1,992,553  $   1,760,896
    Accrued capital gains incentive fee to
     affiliate                                    6,469,329              -
    Securities purchased not settled                      -      1,837,500
    Accrued expenses                                320,215        184,146
                                              -------------  -------------
           Total liabilities                      8,782,097      3,782,542
                                              -------------  -------------

NET ASSETS
    Common stock, $0.01 par value,
     100,000,000 shares authorized, and
     32,257,600 and 31,886,367 issued and
     outstanding, respectively                      322,576        318,864
    Capital in excess of par value              366,445,157    369,163,103
    Net unrealized appreciation on
     investments                                 30,451,226     21,335,028
    Accumulated net realized losses on
     investments                                (72,649,613)   (74,545,034)
    Distributions in excess of investment
     income                                      (2,810,017)    (2,154,420)
                                              -------------  -------------
           Total net assets                     321,759,329    314,117,541
                                              -------------  -------------
           Total liabilities and net assets   $ 330,541,426  $ 317,900,083
                                              =============  =============

Net asset value per common share              $        9.97  $        9.85




TICC CAPITAL CORP.

STATEMENTS OF OPERATIONS (UNAUDITED)


                                             Three Months    Three Months
                                                Ended            Ended
                                            March 31, 2011  March 31, 2010
                                            --------------  --------------
INVESTMENT INCOME
From non-affiliated/non-control investments:
  Interest income - debt investments        $    6,889,920  $    5,205,447
  Distributions from securitization
   vehicles - equity investments                 2,328,850         760,983
  Commitment, amendment fee income
   and other income                                159,101          16,565
                                            --------------  --------------
    Total investment income from
     non-affiliated/non-control investments      9,377,871       5,982,995
                                            --------------  --------------
From control investments:
  Interest income - debt investments               382,254         573,096
                                            --------------  --------------
    Total investment income                      9,760,125       6,556,091
                                            --------------  --------------
EXPENSES
Operating expenses
  Compensation expense                             238,064         239,712
  Investment advisory fees                       1,992,553       1,227,050
  Professional fees                                293,272         285,210
  General and administrative                       218,884         158,943
                                            --------------  --------------
    Total operating expenses                     2,742,773       1,910,915

  Capital gains incentive fees                   6,469,329               -
                                            --------------  --------------
    Total expenses                               9,212,102       1,910,915
                                            --------------  --------------
Net investment income                              548,023       4,645,176
                                            --------------  --------------
Net change in unrealized appreciation on
 investments                                     9,116,198      44,466,996
                                            --------------  --------------
Net realized gains (losses) on investments       1,895,421     (31,128,326)
                                            --------------  --------------
Net increase in net assets resulting from
 operations                                 $   11,559,642  $   17,983,846
                                            ==============  ==============

Net increase in net assets resulting from
 net investment income per common share:
            Basic and diluted               $         0.02  $         0.17
Net increase in net assets resulting from
 operations per common share:
            Basic and diluted               $         0.36  $         0.67
Weighted average shares of common stock
 outstanding:
            Basic and diluted                   31,912,859      26,813,902




TICC CAPITAL CORP.

FINANCIAL HIGHLIGHTS (UNAUDITED)


                                            Three Months     Three Months
                                                Ended            Ended
                                           March 31, 2011   March 31, 2010
                                             (unaudited)      (unaudited)
                                           --------------   --------------

Per Share Data
Net asset value at beginning of period     $         9.85   $         8.36
                                           --------------   --------------
Net investment income(1)                             0.02             0.17
Net realized and unrealized capital gains(2)         0.34             0.49
                                           --------------   --------------
Total from investment operations                     0.36             0.66
                                           --------------   --------------
Total distributions(3)                              (0.24)           (0.15)
                                           --------------   --------------
Effect of shares issued, net of offering
 expenses                                            0.00             0.00
                                           --------------   --------------
Net asset value at end of period           $         9.97  $          8.87
                                           ==============   ==============
Per share market value at beginning
 of period                                 $        11.21  $          6.05
Per share market value at end of period    $        10.87  $          6.59
Total return(4)                                     (0.89%)          11.41%
Shares outstanding at end of period            32,257,600       26,874,923

Ratios/Supplemental Data
Net assets at end of period (000's)        $      321,759  $       238,461
Average net assets (000's)                 $      314,591  $       225,534
Ratio of expenses to average net assets:
     Operating expense                               3.49%            3.39%
     Capital gains incentive fee                     8.22%            0.00%
                                           --------------   --------------
Total ratio of expenses to average net
 assets(5)                                          11.71%            3.39%
                                           ==============   ==============
Ratio of net investment income to
 average net assets(5)                               0.70%            8.24%
Ratio of core net investment income to
 average net assets(5)                               8.92%            8.24%


(1) Represents per share net investment income for the period, based upon
    average shares outstanding.
(2) Net realized and unrealized capital gains include rounding adjustment
    to reconcile change in net asset value per share.
(3) Management monitors available taxable earnings, including net
    investment income and realized capital gains, to determine if a tax
    return of capital may occur for the year. To the extent the Company's
    taxable earnings fall below the total amount of the Company's
    distributions for that fiscal year, a portion of those distributions
    may be deemed a tax return of capital to the Company's stockholders.
    The tax character of distributions will be determined at the end of the
    fiscal year. However, if the character of such distributions were
    determined as of March 31, 2011, none of the distributions for 2011
    would have been characterized as a tax return of capital to the
    Company's stockholders; this tax return of capital may differ from the
    return of capital calculated with reference to net investment income
    for financial reporting purposes.
(4) Total return equals the increase or decrease of ending market value
    over beginning market value, plus distributions, divided by the
    beginning market value, assuming dividend reinvestment prices obtained
    under the Company's dividend reinvestment plan. Total return is not
    annualized.
(5) Annualized.


About TICC Capital Corp.

We are a publicly traded business development company principally engaged in providing capital to small to mid-size companies. While the structures of our financings vary, we look to invest primarily in the debt of established businesses. Companies interested in learning more about financing opportunities should contact Debdeep Maji at (203) 983-5285 or visit our website at www.ticc.com.

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.

Contact Information

  • Contacts:
    Bruce Rubin
    203-983-5280
    Patrick Conroy
    203-983-5282