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Investcorp Credit Management BDC, Inc. Announces Financial Results for the Quarter Ended December 31, 2020 and Quarterly and Supplemental Distributions

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NEW YORK, Feb. 9, 2021 /PRNewswire/ -- Investcorp Credit Management BDC, Inc. (NASDAQ: ICMB) ("ICMB" or the "Company") announced its financial results today for its fiscal second quarter ended December 31, 2020.

(PRNewsfoto/Investcorp)
(PRNewsfoto/Investcorp)

HIGHLIGHTS

  • On February 3, 2021, the Company's Board declared a distribution for the quarter ending March 31, 2021 of $0.15 per share, payable on April 1, 2021, to stockholders of record as of March 12, 2021, and a supplemental distribution of $0.03 per share, payable on April 1, 2021, to stockholders of record as of March 12, 2021.

  • ICMB made four investments, across one existing portfolio company and three new portfolio companies. These investments totaled $17.6mm. The weighted average yield of debt investments made in the quarter was 11.75%.

  • ICMB fully realized four investments during the quarter, totaling $15.8 million, and received additional partial repayments totaling $7.2 million.

  • The weighted average yield on debt investments, at cost, increased 51 basis points to 9.76%, compared to 9.25% as of September 30, 2020.

  • Net asset value ("NAV") increased $0.03 per share to $7.84, compared to $7.81 as of September 30, 2020. The Net Assets increased by $0.612mil or 0.56% for the quarter ended December 31, 2020.

Portfolio results, as of December 31, 2020:


Total assets

$271.5mm

Investment portfolio, at fair value

$257.7mm

Net assets

$109.1mm

Weighted average yield on debt investments, at cost

9.76%

Net asset value per share

$7.84

Portfolio activity in the current quarter:


Number of new investments

3

Total capital invested

$17.6mm

Proceeds from repayments, sales, and amortization

$23.0mm

Number of portfolio companies, end of period

37

Net investment income (NII)

$3.0mm

Net investment income per share

$0.22

Net increase in net assets from operations

$3.1mm

Net decrease in net assets from operations per share

$0.22

Quarterly per share distribution paid on January 4, 2021

$0.18

Mr. Michael C. Mauer, the Company's Chief Executive Officer, said, "The current market has highlighted companies with resilient business models and strong capital structures. In this environment we continue to see good investment opportunities at attractive yields."

The Company's dividend framework provides a quarterly base dividend and is supplemented (when available) by additional dividends determined by the net investment income during the quarter.

On November 3, 2020, the Company's Board of Directors (the "Board") declared a distribution for the quarter ending December 31, 2020 of $0.15 per share, payable on January 4, 2021, to stockholders of record as of December 10, 2020, and a supplemental distribution of $0.03 per share, payable on January 4, 2021, to stockholders of record as of December 10, 2020.

These distributions represent a 14.26% yield on the Company's $5.05 share price as of market close on February 8, 2021. Distributions may include net investment income, capital gains and/or return of capital, however, the Company does not expect these distributions to be comprised of a return of capital. The tax status of distributions will be determined at the end of the taxable year.

Portfolio and Investment Activities
During the quarter, the Company made four investments, across one existing portfolio company and three new portfolio companies. The aggregate capital invested during the quarter totaled $17.6mm, at cost, and the new debt investments were made at a weighted average yield of 11.75%.

The Company received proceeds of $23.1mm from repayments, sales and amortization during the quarter, primarily related to the realizations of KIK Custom Products, RPX, Northstar Group, and Deluxe.

The Company's realized and unrealized gains and losses accounted for an increase in the Company's net investments of $0.1mm, or $0.00 per share. The total net increase in net assets resulting from operations for the quarter was $3.1mm, or $0.22 per share.

As of December 31, 2020, the Company's investment portfolio consisted of investments in 37 portfolio companies, of which 87.2% were first lien investments, 4.9% were second lien investments, 4.4% were unitranche loans, and 3.5% were equity, warrants, and other investments. The Company's debt portfolio consisted of 99.4% floating rate investments and 0.6% fixed rate investments.

COVID-19 Developments
During the six months ended December 31, 2020, the Company's portfolio was negatively affected by the economic uncertainty caused by the novel coronavirus ("COVID-19") pandemic. The Company has closely monitored its portfolio companies throughout this period, including assessing portfolio companies' operational and liquidity exposure and outlook. Though the magnitude of the impact remains to be seen, certain of the Company's portfolio companies and, by extension, select operating results have been, and may continue to be, adversely impacted by the COVID-19 pandemic. For additional information about the COVID-19 pandemic and its potential impact on the Company's results of operations and financial condition, please refer to the disclosure in the Company's Form 10-Q for the quarter ended December 31, 2020.

Capital Resources
As of December 31, 2020, the Company had $3.8mm in cash, $4.7mm in restricted cash and $16mm of capacity under its revolving credit facility with UBS AG, London Branch.

Subsequent Events
Subsequent to December 31, 2020 and through February 8, 2021, the Company made no new investments and received $2.9mm in repayments. As of February 8, 2021, the Company had 37 portfolio companies.

Investcorp Credit Management BDC, Inc. and Subsidiaries






Consolidated Statements of Assets and Liabilities


























December 31, 2020








(Unaudited)



June 30, 2020

Assets







Non-controlled, non-affiliated investments, at fair value (amortized cost of

$

257,731,578


$

270,621,709


$303,922,586 and $ 316,924,638, respectively)






Cash




3,771,963



14,876,444

Cash, restricted


4,707,001



5,417,118

Receivable for investments sold


2,033,722



1,576,730

Interest receivable


2,219,364



2,301,641

Payment-in-kind interest receivable


532,680



514,643

Other receivables


427,208



1,135,563

Prepaid expenses and other assets


119,263



350,661


Total Assets

$

271,542,779


$

296,794,509









Liabilities







Notes payable:







Term loan

$

102,000,000


$

102,000,000


Revolving credit facility


4,000,000



30,000,000


2023 Notes payable


51,375,000



51,375,000


Deferred debt issuance costs


(870,365)



(1,042,497)



Notes payable, net


156,504,635



182,332,503

Dividend payable


2,503,272



2,499,360

Income-based incentive fees payable


649,122



707,796

Base management fees payable


1,095,082



1,196,937

Interest payable


977,229



1,000,452

Directors' fees payable


23,809



24,559

Accrued expenses and other liabilities


718,316



907,907


Total Liabilities


162,471,465



188,669,514









Commitments and Contingencies (Note 6)














Net Assets







Common stock, par value $0.001 per share (100,000,000 shares authorized,







13,907,064 and 13,885,335 shares issued and outstanding, respectively)


13,907



13,885

Additional paid-in capital


200,850,429



200,779,949

Distributable earnings (loss)


(91,793,022)



(92,668,839)


Total Net Assets


109,071,314



108,124,995


Total Liabilities and Net Assets

$

271,542,779


$

296,794,509

Net Asset Value Per Share

$

7.84


$

7.79

















See notes to unaudited consolidated financial statements.









Investcorp Credit Management BDC, Inc. and Subsidiaries













Consolidated Statements of Operations (Unaudited)































For the three months ended
December 31,


For the six months ended
December 31,













2020


2019


2020


2019


Investment Income:














Interest income


$

5,823,345


$

7,741,904


$

11,910,939


$

15,312,166


Payment in-kind interest income


891,417



1,454,214



1,731,744



2,361,991


Other fee income



373,004



235,331



416,064



315,726




Total investment income


7,087,766



9,431,449



14,058,747



17,989,883


















Expenses:














Interest expense



1,837,775



2,533,278



3,819,500



4,885,023


Base management fees



1,189,440



1,369,983



2,410,212



2,725,061


Income-based incentive fees



-



851,842



-



851,842


Provision for tax expense



5,780



10,018



5,780



10,018


Professional fees



319,725



390,107



639,450



699,960


Allocation of administrative costs from advisor


354,000



330,000



708,000



682,000


Amortization of deferred debt issuance costs


-



195,377



-



390,754


Insurance expense



108,186



83,761



216,372



167,523


Directors' fees



78,625



22,500



155,250



105,000


Custodian and administrator fees


63,822



77,597



129,749



207,469


Offering expense



86,906



85,604



172,133



137,354


Other expenses



119,828



120,590



245,100



276,860




Total expenses



4,164,087



6,070,657



8,501,546



11,138,864


Waiver of base management fees


(94,359)



(57,852)



(207,330)



(102,035)


Waiver of income-based incentive fees


-



(336,619)



-



(336,619)




Net expenses



4,069,728



5,676,186



8,294,216



10,700,210




Net investment income


3,018,038



3,755,263



5,764,531



7,289,673


Net realized and unrealized gain/(loss) on investments:

























Net realized gain (loss) from investments


-



25,285



3,693



56,358


Net change in unrealized appreciation (depreciation) in value


-












of investments



59,768



(813,105)



111,899



(5,285,140)




Total realized and unrealized gain (loss) on investments

59,768



(787,820)



115,592



(5,228,782)


Net increase (decrease) in net assets resulting from operations













$

3,077,806


$

2,967,443


$

5,880,123


$

2,060,891


















































Basic and diluted:
















Net investment income per share

$

0.22


$

0.27


$

0.41


$

0.53




Earnings per share


$

0.22


$

0.22


$

0.42


$

0.15




















Weighted average shares of common stock outstanding


13,905,173



13,668,027



13,899,449



13,646,653


















Distributions paid per common share

$

0.18


$

0.25


$

0.36


$

0.50


































See notes to unaudited consolidated financial statements.


















About Investcorp Credit Management BDC, Inc.
The Company is an externally-managed, closed-end, non-diversified management investment company that has elected to be regulated as a business development company under the Investment Company Act of 1940. The Company's investment objective is to maximize the total return to its stockholders in the form of current income and capital appreciation through debt and related equity investments by targeting investment opportunities with favorable risk-adjusted returns. The Company seeks to invest primarily in middle-market companies that have annual revenues of at least $50mm and earnings before interest, taxes, depreciation and amortization of at least $15mm. The Company's investment activities are managed by its investment adviser, CM Investment Partners LLC. To learn more about Investcorp Credit Management BDC, Inc., please visit www.icmbdc.com.

Forward-Looking Statements
Statements included herein in this press release may contain "forward-looking statements," which relate to future performance or financial condition, are based upon current expectations and are inherently uncertain. Any such statements, other than statements of historical fact, are likely to be affected by other unknowable future events and conditions, including elements of the future that are or are not under the Company's control and including the impact of COVID-19 and related changes in base interest rates and significant market volatility on our business, our portfolio companies, our industry and the global economy, and that the Company may or may not have considered; accordingly, such statements cannot be guarantees or assurances of any aspect of future performance. 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 assumptions, risks and uncertainties, which change over time. Actual results may differ materially from those anticipated in any forward-looking statements as a result of a number of factors, including those described from time to time in filings by the Company with the Securities and Exchange Commission. All forward-looking statements speak only as of the date of this press release. The Company undertakes no duty to update any forward-looking statement made herein except as required by law.

Contacts
Investcorp Credit Management BDC, Inc.
Investor Relations
Email: icmbinvestorrelations@investcorp.com
Phone: 212-257-5199

Cision
Cision

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SOURCE Investcorp Credit Management BDC, Inc.