Kayne Anderson Energy Development Company (the “Company”) (NYSE:KED) today announced its financial results for the quarter ended February 28, 2011.
PORTFOLIO AND INVESTMENT ACTIVITY
- The Company increased its quarterly distribution to $0.31 per share, up 3.3% from the prior quarter’s distribution of $0.30 per share.
- Net asset value: $21.88 per share; up $1.32 per share from the prior quarter (6.4% increase)
- Net investment loss: $0.3 million
- Net realized losses: $3.2 million
- Net unrealized gains: $20.2 million
As of February 28, 2011, the Company had long-term investments of $298.7 million. The Company’s long-term investments consisted of 42 portfolio companies, of which approximately 52% were private MLPs, 30% were public MLPs and 18% were debt securities.
On March 6, 2011, the Company announced that one of its portfolio companies, International Resource Partners LP (“IRP”), entered into a definitive agreement to sell all its partnership interests to James River Coal Company (NASDAQ: JRCC) for total consideration of $475 million in cash, subject to customary closing adjustments. We expect this transaction to close during April, assuming the Hart-Scott-Rodino 30-day waiting period expires without further comments or requests for additional information.
The Company estimates that its share of the net proceeds from the sale will be approximately $100 million, of which approximately $94 million will be received in cash at closing and approximately $6 million will be held in escrow pending satisfaction of certain post-closing obligations or the expiration of certain time periods. Such escrow will be used to fund any indemnity claims and certain other contingent expenses, if any. As of February 28, 2011, the Company valued its investment in IRP at $94.5 million.
RESULTS OF OPERATIONS – QUARTER ENDED FEBRUARY 28, 2011
Investment income totaled $1.7 million and consisted primarily of interest income on the Company’s debt investments and net dividends and distributions. The Company received $2.5 million of cash dividends and distributions, of which $1.9 million was treated as a return of capital during the period. The Company received $2.0 million of paid-in-kind dividends, comprised of $1.4 million from Direct Fuels Partners, L.P. (“Direct Fuels”) and $0.6 million from VantaCore Partners LP (“VantaCore”). These paid-in-kind dividends are not included in investment income but are reflected as an unrealized gain.