Monroe Capital Corporation announced its financial results for the first quarter ended March 31, 2017.

The company had debt and equity investments in 65 portfolio companies, with a total fair value of $418.1 million, as of March 31, 2017 as compared to debt and equity investments in 70 portfolio companies, with a total fair value of $412.9 million, as of December 31, 2016. The Company’s portfolio consists primarily of first lien loans, representing 83.9% of the portfolio as of March 31, 2017 and 79.2% of the portfolio as of December 31, 2016. As of March 31, 2017, the weighted average contractual and effective yield on the Company’s investments was 9.6% and 9.7%, respectively, as compared to the weighted average contractual and effective yield of 9.5% and 9.6%, respectively, as of December 31, 2016. Portfolio yield is calculated only on the portion of the portfolio that has a contractual coupon and therefore does not account for dividends on equity investments (other than preferred equity). 

 First Quarter 2017 Financial Highlights:

• Net investment income of $6.0 million, or $0.36 per share
• Adjusted Net Investment Income (a non-GAAP measure described below) of $5.9 million, or $0.35 per share
• Net increase in net assets resulting from operations of $2.6 million, or $0.15 per share
• Net asset value (“NAV”) of $239.6 million, or $14.34 per share
• Paid quarterly dividend of $0.35 per share on March 31, 2017

Chief Executive Officer Theodore L. Koenig commented, “We are pleased to report another quarter of strong earnings for the first quarter of 2017, with Adjusted Net Investment Income of $0.35 per share, once again covering our first quarter dividend of $0.35 per share and representing 12 straight quarters of dividend coverage without a reduction in our quarterly distribution.  We are also pleased to have been able to continue to grow the portfolio during the quarter despite seeing a significant amount of prepayment activity, increasing our  portfolio by $5.2 million to $418.1 million as of quarter end. Our recently announced upsize to our revolving credit facility, now totaling $200.0 million in commitments, and our access to $55.0 million of additional SBA-guaranteed debentures, will allow us to profitably grow our portfolio and continue to create long term value for our shareholders.”

Net investment income for the quarter ended March 31, 2017 totaled $6.0 million, or $0.36 per share, compared to $5.4 million, or $0.32 per share, for the quarter ended December 31, 2016. Adjusted Net Investment Income was $5.9 million, or $0.35 per share, for the quarter ended March 31, 2017, compared to $5.8 million, or $0.35 per share, for the quarter ended December 31, 2016.  The Company believes that Adjusted Net Investment Income is a consistent measure of the Company’s earnings – see Non-GAAP Financial Measure – Adjusted Net Investment Income discussion below. Total investment income increased by $0.8 million during the quarter.  Interest income increased during the quarter, primarily as a result in the increase in the size of the Company’s average investment portfolio and an increase in prepayment gains. Total expenses, net of the prior quarter incentive fee waiver, increased by $0.1 million during the quarter, primarily driven by increases in interest expense, partially offset by declines in excise taxes.

Net gain (loss) on investments and secured borrowings was ($3.5) million for the quarter ended March 31, 2017, compared to $2.2 million for the quarter ended December 31, 2016. The net loss on investments and secured borrowings during the quarter ended March 31, 2017 was primarily the result of net unrealized mark-to-market losses on investments in the portfolio during the quarter.

Net increase in net assets resulting from operations was $2.6 million, or $0.15 per share, for the quarter ended March 31, 2017, compared to $7.5 million, or $0.45 per share, for the quarter ended December 31, 2016.  This decrease is primarily the result of net unrealized mark-to-market losses on investments during the quarter, partially offset by an increase in net investment income. The Company’s NAV decreased on a per share basis to $14.34 per share at March 31, 2017 from $14.52 per share at December 31, 2016.  This decrease in NAV per share was primarily driven by net unrealized mark-to-market losses on investments in the quarter.