LONDON, UK / ACCESSWIRE / October 16, 2017 / Pro-Trader Daily has just published a free post-earnings coverage on Saratoga Investment Corp. (NYSE: SAR) ("Saratoga"), which can be viewed by registering at http://protraderdaily.com/optin/?symbol=SAR, following the Company's reporting of its financial results on October 11, 2017, for the second quarter of the fiscal year 2018. The business development Company's total investment income increased 21.3% on a y-o-y basis. Our daily stock reports are accessible for free, and with those to look forward today you also will be signing up for a complimentary member's account at: http://protraderdaily.com/register/.
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For the three months ended August 31, 2017, Saratoga's total investment income increased 21.3% to $10.25 million from $8.45 million in Q2 FY17. The Company's reported numbers beat analysts' estimates of $9.27 million.
During Q2 FY18, Saratoga's professional fees expenses increased 34.7% to $407,372 from $302,227 in Q2 FY17. For the reported quarter, the Company's administrator expenses increased 21.8% to $395,833 from $325,000 in the year ago same period. For the reported quarter, the Company's G&A expenses decreased 5.8% to $287,201 from $304,955 in Q2 FY17. During Q2 FY18, the Company's total operating expenses increased 25.9% to $7.36 million from $5.84 million in the same period of last year.
For the reported quarter, Saratoga's net investment income increased 101.0% to $2.89 million from $2.60 million in Q2 FY17. During Q2 FY18, the Company's net investment income per share increased 8.8% to $0.49 from $0.45 in the same period of last year. Adjusted for the incentive fee accrual related to net unrealized capital gains, the Company's adjusted net investment income increased 20.6% to $3.68 million from $3.05 million in Q2 FY17. For the reported quarter, Saratoga's adjusted net investment income per share increased 16.9% to $0.62 from $0.53 in the corresponding period of last year.
During Q2 FY18, Saratoga's net assets increased 30.3% to $6.87 million on a y-o-y basis from $5.27 million in Q2 FY17. During Q2 FY18, Saratoga's diluted earnings per share (EPS) increased 25% to $1.15 on a y-o-y basis from $0.92 in Q2 FY17.
Asset under Management
As of August 31, 2017, Saratoga's assets under management (AUM) grew to $333.0 million, reflecting an increase of 1.0% from $329.7 million as of May 31, 2017, and an increase of 22.1% from $272.8 million as of August 31, 2016.
As of August 31, 2017, the fair value of Saratoga's portfolio was $333.0 million (excluding $18.4 million in cash and cash equivalents), principally invested in 31 portfolio companies and one collateralized loan obligation fund (CLO). The overall portfolio composition consisted of 54.9% of first lien term loans; 29.2% of second lien term loans; 5.0% of subordinated notes in a CLO; 2.7% of syndicated loans; and 8.2% of common equity.
During Q2 FY18, the Company's interest receivable increased 14.5% to $3.77 million from $3.29 million in Q4 FY17.
For the reported quarter, Saratoga's total assets increased 11.7% to $356.13 million from $318.65 million in Q4 FY17.
For the reported quarter, the Company's notes payable was at par with the $74.45 million reported in Q4 FY17. For the reported quarter, accounts payable and accrued expenses increased 28.8% to $1.10 million from $852,987 in Q4 FY17.
For the reported quarter, Saratoga's asset coverage ratio was 258% compared to 271% in Q4 FY17.
During Q2 FY18, the Company's Net Asset Value (NAV) increased 3.8% to $133.46 million from $128.56 million in Q2 FY17. As of August 31, 2017, the Company sold 117,354 shares above NAV for gross proceeds of $2.6 million at an average price of $22.49 for aggregate net proceeds of $2.6 million.
Share Repurchase Plan
In FY15, Saratoga announced the approval of an open market share repurchase plan that allows it to repurchase up to 200,000 shares of its common stock at prices below its NAV. During FY17, this share repurchase plan was extended for another year through October 2017, and increased to 600,000 shares of common stock. On October 10, 2017, the Company's Board of Directors extended the open market share repurchase plan for another year to October 15, 2018, leaving the number of shares unchanged at 600,000 shares of its common stock.
As of August 31, 2017, Saratoga had purchased 218,491 shares of common stock, at an average price of $16.87 for approximately $3.7 million pursuant to this repurchase plan. There were no share repurchases during Q2 FY18.
On Friday, October 13, 2017, the stock closed the trading session at $22.27, rising 3.58% from its previous closing price of $21.50. A total volume of 37.75 thousand shares have exchanged hands, which was higher than the 3-month average volume of 21.17 thousand shares. Saratoga Investment's stock price surged 7.12% in the last three months, 5.00% in the past six months, and 22.23% in the previous twelve months. Furthermore, since the start of the year, shares of the Company have gained 8.05%. The stock is trading at a PE ratio of 12.24 and has a dividend yield of 8.62%. At Friday's closing price, the stock's net capitalization stands at $129.17 million.
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