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American Capital CEO Discusses Q3 2011 Results - Earnings Call Transcript

In addition, another element of the frustration is that we had a great quarter in terms of net realized earnings of $0.28, $98 million in total. A lot of that was driven by the $93 million realized gain that we experienced on the sale of Value Plastics, a very fine portfolio company, and I'm very pleased with those kind of results.

But as you can see, we had $1.34 in net loss, overall $464 million. That was driven by $562 million of unrealized depreciation, and that's primarily caused by depreciation at European Capital, two different Sponsor Finance loans, and at our asset management company, American Capital LLC. And I'll talk more about those in a minute. So our NAV is at $11.92. That's a 9% climb from the second quarter.

Moving to Slide 4 to talk about our $4 billion of value in our Private Finance portfolio, starting with our One Stop Buyouts, we had $100 million of net unrealized depreciation driven primarily by multiple reductions and offset by moderately positive aggregate adjusted EBITDA and sales growth.

So though we're experiencing in the last three months from a portfolio of companies, a nice growth. The fact of the matter is at the end of the quarter when the world was concerned with downgraded U.S. debt and with the sovereign debt problems in Europe that the world was struggling over, it caused values to drop and you can see the impact here on our One Stop Buyouts.

By the way, we are breaking out in our static pool analysis an additional data on our One Stop Buyouts, and you could see there in the back the presentation of $3 billion of aggregate total sales in our company and a total of $700 million of aggregate adjusted EBITDA. And we have about 48,000 employees in these companies.

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