Blue Owl Capital Corporation III Reports Second Quarter Net Investment Income Per Share of $0.41 and Net Asset Value Per Share of $15.56
SECOND QUARTER 2024 HIGHLIGHTS
- Second quarter net investment income ("NII") per share of
$0.41 , which exceeds the second quarter regular dividend of$0.35 per share by over 15% - As previously announced in January, the Board of Directors (the "Board") declared five special dividends of
$0.06 per share; the second of which will be payable on or beforeSeptember 13, 2024 to shareholders of record as ofAugust 30, 2024 - 10.5% annualized dividend yield based on second quarter net asset value ("NAV") per share1
- NAV per share of
$15.56 , up$0.28 compared toJune 30, 2023 - Net debt-to-equity increased to 1.22x for quarter ending
June 30, 2024 , up from 1.04x as ofMarch 31, 2024 - Also announced today that OBDE entered into a definitive merger agreement with
(NYSE: OBDC)Blue Owl Capital Corporation
"In our first full quarter as a publicly traded company, we continued to make significant progress towards growing our portfolio, deploying capital into attractive opportunities which enabled OBDE to deliver a strong return on equity of 10.5%," commented
OBDC to Merge with OBDE
OBDC and OBDE today announced that they have entered into a definitive merger agreement, with OBDC as the surviving company, subject to certain shareholder approvals and other customary closing conditions. Following the recommendation of each of their special committees, the boards of directors of both OBDC and OBDE have unanimously approved the transaction. A separate press release and investor presentation can be found on the Company's website, www.BlueOwlCapitalCorporationIII.com.
Dividend Declarations
The Company's Board declared a third quarter 2024 dividend of
In addition, and as previously announced, the Board declared a series of five special dividends of
PORTFOLIO AND INVESTING ACTIVITY
For the three months ended
For the three months ended
For the three months ended
As of
As of
As of
As of
As of
As of
RESULTS OF OPERATIONS FOR THE SECOND QUARTER ENDED JUNE 30, 2024
Investment Income
Investment income increased to
Expenses
Total expenses increased to
Liquidity and Capital Resources
As of
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(1) |
Dividend yield reflects regular Q2'24 dividend of |
CONFERENCE CALL AND WEBCAST INFORMATION
Conference Call Information:
The conference call will be broadcast live on
Participants are also invited to access the conference call by dialing one of the following numbers:
- Domestic: (877) 407-9714
- International: +1 (201) 689-8865
All callers will need to reference "
Replay Information:
An archived replay will be available for 14 days via a webcast link located on the Events section of OBDE's website, and via the dial-in numbers listed below:
- Domestic: (877) 660-6853
- International: +1 (201) 612-7415
- Conference ID: 13747167
ABOUT BLUE OWL CAPITAL CORPORATION III
Blue Owl Capital Corporation III (NYSE: OBDE) is a specialty finance company focused on lending to
Certain information contained herein may constitute "forward-looking statements" that involve substantial risks and uncertainties. Such statements involve known and unknown risks, uncertainties and other factors and undue reliance should not be placed thereon. These forward-looking statements are not historical facts, but rather are based on current expectations, estimates and projections about OBDE, its current and prospective portfolio investments, its industry, its beliefs and opinions, and its assumptions. Words such as "anticipates," "expects," "intends," "plans," "will," "may," "continue," "believes," "seeks," "estimates," "would," "could," "should," "targets," "projects," "outlook," "potential," "predicts" and variations of these words and similar expressions are intended to identify forward-looking statements. These statements are not guarantees of future performance and are subject to risks, uncertainties and other factors, some of which are beyond OBDE's control and difficult to predict and could cause actual results to differ materially from those expressed or forecasted in the forward-looking statements including, without limitation, the risks, uncertainties and other factors identified in OBDE's filings with the
INVESTOR CONTACTS
Investor Contact:
BDC Investor Relations
credit-ir@blueowl.com
Media Contact:
pro-blueowl@prosek.com
FINANCIAL HIGHLIGHTS |
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For the Three Months Ended |
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($ in thousands, except per share amounts) |
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Investments at Fair Value |
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$ 4,346,302 |
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$ 3,987,997 |
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$ 3,590,701 |
Total Assets |
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$ 4,502,757 |
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$ 4,180,538 |
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$ 3,761,097 |
Net Asset Value Per Share |
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$ 15.56 |
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$ 15.65 |
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$ 15.56 |
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Investment Income |
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$ 123,175 |
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$ 113,445 |
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$ 111,542 |
Net Investment Income |
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$ 50,381 |
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$ 48,275 |
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$ 71,647 |
Net Income |
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$ 39,615 |
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$ 54,061 |
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$ 80,557 |
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Net Investment Income Per Share |
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$ 0.41 |
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$ 0.39 |
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$ 0.58 |
Net Realized and Unrealized Gains (and Losses) Per Share |
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$ (0.09) |
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$ 0.05 |
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$ 0.07 |
Net Income Per Share |
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$ 0.32 |
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$ 0.44 |
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$ 0.66 |
Distributions Declared from Net Investment Income Per Share |
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$ 0.35 |
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$ 0.35 |
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$ 0.49 |
Weighted Average Yield of |
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11.5 % |
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11.7 % |
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12.1 % |
Weighted Average Yield of |
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11.5 % |
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11.7 % |
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12.1 % |
Percentage of Debt Investments at Floating Rates at Fair Value |
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97.5 % |
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98.2 % |
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98.1 % |
CONSOLIDATED STATEMENTS OF ASSETS AND LIABILITIES |
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(Amounts in thousands, except share and per share amounts) |
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(Unaudited) |
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Assets |
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Investments at fair value |
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Non-controlled, non-affiliated investments (amortized cost of |
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$ 4,232,211 |
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$ 3,498,800 |
Non-controlled, affiliated investments (amortized cost of |
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114,091 |
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91,901 |
Total investments at fair value (amortized cost of |
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4,346,302 |
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3,590,701 |
Cash |
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120,344 |
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141,448 |
Interest receivable |
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31,482 |
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25,147 |
Prepaid expenses and other assets |
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4,629 |
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3,801 |
Total Assets |
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$ 4,502,757 |
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$ 3,761,097 |
Liabilities |
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Debt (net of unamortized debt issuance costs of |
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$ 2,434,508 |
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$ 1,754,496 |
Distribution payable |
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43,175 |
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60,779 |
Management fee payable |
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15,491 |
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4,517 |
Incentive fee payable |
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10,687 |
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— |
Payables to affiliates |
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4,197 |
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896 |
Payable for investments purchased |
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37,157 |
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— |
Accrued expenses and other liabilities |
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38,382 |
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29,297 |
Total Liabilities |
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$ 2,583,597 |
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$ 1,849,985 |
Commitments and contingencies (Note 7) |
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Net Assets |
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Common shares |
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1,234 |
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1,228 |
Additional paid-in-capital |
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1,837,067 |
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1,829,029 |
Accumulated undistributed (overdistributed) earnings |
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80,859 |
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80,855 |
Total Net Assets |
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$ 1,919,160 |
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$ 1,911,112 |
Total Liabilities and Net Assets |
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$ 4,502,757 |
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$ 3,761,097 |
Net Asset Value Per Share |
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$ 15.56 |
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$ 15.56 |
CONSOLIDATED STATEMENTS OF OPERATIONS |
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(Amounts in thousands, except share and per share amounts) |
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(Unaudited) |
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For the Three Months |
For the Six Months |
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2024 |
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2023 |
2024 |
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2023 |
Investment Income |
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Investment income from non-controlled, non-affiliated investments: |
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Interest income (excluding payment-in-kind ("PIK") interest income) |
$ 103,848 |
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$ 84,665 |
$ 199,478 |
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$ 164,205 |
PIK interest income |
11,341 |
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12,389 |
20,903 |
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24,872 |
Dividend income |
4,706 |
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6,395 |
10,031 |
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11,374 |
Other income |
1,003 |
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2,246 |
2,696 |
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3,305 |
Total investment income from non-controlled, non-affiliated investments |
120,898 |
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105,695 |
233,108 |
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203,576 |
Investment income from non-controlled, affiliated investments: |
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Interest income (excluding PIK interest income) |
381 |
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— |
789 |
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— |
PIK interest income |
— |
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— |
29 |
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— |
Dividend income |
1,894 |
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495 |
2,689 |
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495 |
Other income |
2 |
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— |
5 |
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— |
Total investment income from non-controlled, affiliated investments |
2,277 |
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495 |
3,512 |
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495 |
Total Investment Income |
123,175 |
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106,190 |
236,620 |
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204,071 |
Expenses |
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Interest expense |
42,707 |
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29,713 |
78,485 |
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58,252 |
Management fee |
15,491 |
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4,463 |
27,342 |
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8,856 |
Performance based incentive fees |
10,687 |
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— |
17,827 |
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— |
Professional fees |
1,610 |
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1,316 |
3,194 |
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2,575 |
Directors' fees |
227 |
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197 |
455 |
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393 |
Listing advisory fees |
— |
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— |
6,040 |
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— |
Other general and administrative |
1,756 |
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640 |
3,907 |
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1,371 |
Total Expenses |
72,478 |
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36,329 |
137,250 |
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71,447 |
Net Investment Income (Loss) Before Taxes |
50,697 |
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69,861 |
99,370 |
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132,624 |
Income tax expense (benefit), including excise tax expense (benefit) |
316 |
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209 |
714 |
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1,393 |
Net Investment Income (Loss) After Taxes |
$ 50,381 |
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$ 69,652 |
$ 98,656 |
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$ 131,231 |
Net Realized and Change in Unrealized Gain (Loss) |
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Net change in unrealized gain (loss): |
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Non-controlled, non-affiliated investments |
(10,525) |
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172 |
(2,816) |
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23,971 |
Non-controlled, affiliated investments |
154 |
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(402) |
1,689 |
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(376) |
Translation of assets and liabilities in foreign currencies |
545 |
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115 |
268 |
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167 |
Income tax (provision) benefit |
— |
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— |
1 |
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(1) |
Total Net Change in Unrealized Gain (Loss) |
(9,826) |
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(115) |
(858) |
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23,761 |
Net realized gain (loss): |
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Non-controlled, non-affiliated investments |
137 |
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33 |
(3,252) |
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(11,465) |
Foreign currency transactions |
(1,077) |
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(40) |
(870) |
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(21) |
Total Net Realized Gain (Loss) |
(940) |
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(7) |
(4,122) |
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(11,486) |
Total Net Realized and Change in Unrealized Gain (Loss) |
(10,766) |
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(122) |
(4,980) |
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12,275 |
Net Increase (Decrease) in Net Assets Resulting from Operations |
$ 39,615 |
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$ 69,530 |
$ 93,676 |
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$ 143,506 |
Earnings (Loss) Per Share - Basic and Diluted |
$ 0.32 |
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$ 0.57 |
$ 0.76 |
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$ 1.18 |
Weighted Average Shares Outstanding - Basic and Diluted |
123,322,207 |
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121,873,455 |
123,175,249 |
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121,539,291 |
PORTFOLIO AND INVESTMENT ACTIVITY |
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For the Three Months Ended
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($ in thousands) |
2024 |
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2023 |
New investment commitments |
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Gross originations |
$ 1,016,705 |
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$ 62,258 |
Less: Sell downs |
— |
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(566) |
Total new investment commitments |
$ 1,016,705 |
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$ 61,692 |
Principal amount of investments funded: |
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First-lien senior secured debt investments |
714,903 |
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39,760 |
Second-lien senior secured debt investments |
8,000 |
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— |
Unsecured debt investments |
34,875 |
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— |
Preferred equity investments |
488 |
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10,000 |
Common equity investments |
7,432 |
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4,600 |
Total principal amount of investments funded |
$ 765,698 |
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$ 54,360 |
Principal amount of investments sold or repaid: |
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First-lien senior secured debt investments |
(253,012) |
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(57,269) |
Second-lien senior secured debt investments |
(29,576) |
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(2,400) |
Unsecured debt investments |
(31,606) |
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— |
Preferred equity investments |
(24,153) |
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(1,033) |
Common equity investments |
— |
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(195) |
Total principal amount of investments sold or repaid |
$ (338,347) |
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$ (60,897) |
Number of new investment commitments in new portfolio companies(1) |
31 |
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4 |
Average new investment commitment amount |
$ 24,725 |
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$ 9,147 |
Weighted average term for new debt investment commitments (in years) |
5.8 |
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3.8 |
Percentage of new debt investment commitments at floating rates |
96.4 % |
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100.0 % |
Percentage of new debt investment commitments at fixed rates |
3.6 % |
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— % |
Weighted average interest rate of new debt investment commitments(2) |
10.7 % |
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11.7 % |
Weighted average spread over applicable base rate of new floating rate debt investment commitments |
5.2 % |
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6.4 % |
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(1) Number of new investment commitments represents commitments to a particular portfolio company. |
(2) For the three months ended |
Forward-Looking Statements
Some of the statements in this press release constitute forward-looking statements because they relate to future events, future performance or financial condition of OBDC or OBDE or the two-step merger (collectively, the "Mergers") of OBDE with and into OBDC. The forward-looking statements may include statements as to: future operating results of OBDC and OBDE and distribution projections; business prospects of OBDC and OBDE and the prospects of their portfolio companies; and the impact of the investments that OBDC and OBDE expect to make. In addition, words such as "anticipate," "believe," "expect," "seek," "plan," "should," "estimate," "project" and "intend" indicate forward-looking statements, although not all forward-looking statements include these words. The forward-looking statements contained in this press release involve risks and uncertainties. Certain factors could cause actual results and conditions to differ materially from those projected, including the uncertainties associated with (i) the timing or likelihood of the Mergers closing; (ii) the expected synergies and savings associated with the Mergers; (iii) the ability to realize the anticipated benefits of the Mergers, including the expected accretion to net investment income and the elimination or reduction of certain expenses and costs due to the Mergers; (iv) the percentage of OBDC and OBDE shareholders voting in favor of the proposals submitted for their approval; (v) the possibility that competing offers or acquisition proposals will be made; (vi) the possibility that any or all of the various conditions to the consummation of the Mergers may not be satisfied or waived; (vii) risks related to diverting management's attention from ongoing business operations; (viii) the risk that shareholder litigation in connection with the Mergers may result in significant costs of defense and liability; (ix) changes in the economy, financial markets and political environment; (x) the impact of geo-political conditions, including revolution, insurgency, terrorism or war, including those arising out of the ongoing war between
Additional Information and Where to Find It
In connection with the Merger, OBDC and OBDE plan to file with the
Participation in the Solicitation
OBDC, its directors, certain of its executive officers and certain employees and officers of
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SOURCE Blue Owl Capital Corporation III