CHARLOTTE, NC: Capitala Finance Corp. originated $67.0 million of investments ($62.5 million in five portfolio companies, $4.5 million in six existing portfolio companies) during the quarter, received repayments of $15.4 million, for net deployments of $51.6 million.
Its net assets as of December 31, 2014 were $240.8 million, or $18.56 per common share; total investment income $13.5 million; net investment income $5.1 million, or $0.39 per common share; and net realized capital gains $2.2 million, or $0.17 per common share.
Chairman and Chief Executive Officer Joseph B. Alala, III said, “The results from the fourth quarter of 2014, coupled with recent subsequent events, are confirmation of the strategy we have previously shared with you. The strategy focuses on distribution coverage through core net investment income, achieved through rotation out of equity investments and into debt investments. We are pleased with our investment activity for the fourth quarter, netting $51.6 million of lower and traditional middle market investments. Net investment income increased significantly from the prior quarter resulting from earnings on investments made during the previous two quarters from proceeds from our notes offering in June. Recently announced equity investment exits and related capital gains have allowed us to announce a special distribution of $0.50 per share, to be paid monthly over the remainder of 2015. This is approximately a 32% premium to our normal monthly distributions of $0.1567 per share. The Capitala team remains focused on making quality investments with proper risk adjusted returns, and to provide full distribution coverage from net investment income.”
During the fourth quarter of 2014, the Company originated one lower middle market portfolio investment totaling $20.0 million and $3.7 million in five follow-on investments. The weighted average yield on lower middle market deployments in the fourth quarter of 2014 was 11.9%. During the quarter, the Company received approximately $15.2 million of repayments, resulting in a net realized gain of $2.2 million, or $0.17 per share.
