BlackRock Capital Investment Corp (BKCC) Reports Solid Earnings Growth and NAV Increase for Q3 2023
BlackRock Capital Investment Corp (NASDAQ:BKCC) declares a quarterly cash dividend of $0.10 per share.
GAAP Net Investment Income (NII) increased by 7% from the second quarter and 24% year-over-year.
Net Asset Value (NAV) per share rose to $4.38, marking a 1% increase from the previous quarter.
Merger agreement with BlackRock TCP Capital Corp. (TCPC) announced, aiming to create value for stockholders.
On November 8, 2023, BlackRock Capital Investment Corp (NASDAQ:BKCC) released its financial results for the third quarter ended September 30, 2023. The company reported a GAAP Net Investment Income (NII) of $9.5 million, or $0.13 per share, representing a 7% increase from the second quarter and a 24% increase from the third quarter of 2022. This performance provided a robust 131% dividend coverage on a GAAP basis, up from 123% in the previous quarter and 105% in the same quarter of the previous year.
Financial Performance and Portfolio Growth
BlackRock Capital Investment Corp's NAV experienced a modest increase to $317.6 million as of September 30, 2023, up from $314.0 million at the end of the second quarter. This growth was attributed to $2.3 million of NII exceeding the declared dividend and $1.3 million of net realized and unrealized gains on the portfolio during the quarter. The NAV per share increased to $4.38 from $4.33 in the previous quarter.
The company's portfolio saw significant activity with gross deployments totaling $40.3 million, primarily in first lien loans, and gross repayments of $43.6 million. The weighted average yield on gross deployments during the quarter was 13.4%, an increase from 12.1% in the prior quarter. The portfolio consisted of 120 companies at the end of the quarter, reflecting a well-diversified pool of income-producing assets.
Strategic Developments and Merger Agreement
BlackRock Capital Investment Corp announced a merger agreement with BlackRock TCP Capital Corp. (TCPC), which is expected to close in the first calendar quarter of 2024. This strategic move is anticipated to offer stockholders benefits such as improved access to capital, potential for enhanced trading dynamics, combined operating efficiencies, and a proposed base management fee reduction upon successful closing.
James E. Keenan, Chairman and Interim CEO, commented on the company's performance and strategic direction.
We are pleased to report a continued increase in our NII this quarter which provided a healthy 131% coverage of our dividend... With the successful transformation of the Companys portfolio behind us, our NAV has demonstrated increased stability this year... We believe we are well positioned to withstand the impact of a deteriorating economic environment,"
said Keenan.
Liquidity and Capital Resources
As of September 30, 2023, BlackRock Capital Investment Corp had $8.8 million in cash and cash equivalents, with $81.0 million of availability under its credit facility, resulting in $89.8 million of available liquidity for investment deployment and general business use. The company's net leverage ratio was 0.84x, slightly down from 0.86x as of June 30, 2023.
BlackRock Capital Investment Corp will host a webcast/teleconference to discuss its third quarter 2023 financial results, providing an opportunity for investors to gain further insights into the company's performance and strategic initiatives.
For detailed financial tables and further information on BlackRock Capital Investment Corp's earnings, please visit GuruFocus.com.
Explore the complete 8-K earnings release (here) from BlackRock Capital Investment Corp for further details.
This article first appeared on GuruFocus.
