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BlackRock Kelso Capital Corporation Declares Regular Quarterly Dividend Of $0.26 Per Share, Announces June 30, 2012 Quarterly Financial Results

Share Repurchase Plan

In 2008, our Board of Directors approved a share repurchase plan under which we may repurchase up to 2.5% of our outstanding shares of common stock from time to time in open market or privately negotiated transactions. In 2009, our Board of Directors approved an extension and increase to the plan which authorized us to repurchase up to an additional 2.5% of our outstanding shares of common stock. In May 2012, the repurchase plan was further extended through June 30, 2013, with 1,331,143 shares remaining authorized for repurchase. There were no purchases under the plan during the three and six months ended June 30, 2012. Since inception of the repurchase plan through June 30, 2012, we have purchased 1,425,507 shares of our common stock on the open market for $9.5 million, including brokerage commissions.

Notice is hereby given in accordance with Section 23(c) of the Investment Company Act of 1940 that from time to time we may purchase shares of our common stock in the open market at prevailing market prices.

Conference Call

BlackRock Kelso Capital will host a webcast/teleconference at 4:30 p.m. (Eastern Time) on Thursday, August 2, 2012 to discuss its second quarter 2012 financial results. All interested parties are welcome to participate. You can access the teleconference by dialing, from the United States, (800) 374-0176, or from outside the United States, (706) 679-3431, shortly before 4:30 p.m. and referencing the BlackRock Kelso Capital Corporation Conference Call (ID Number 79703940). A live, listen-only webcast will also be available via the investor relations section of www.blackrockkelso.com.

Both the teleconference and webcast will be available for replay by 6:00 p.m. on Thursday, August 2, 2012 and ending at midnight on Thursday, August 9, 2012. To access the replay of the teleconference, callers from the United States should dial (855) 859-2056 and callers from outside the United States should dial (404) 537-3406 and enter the Conference ID Number 79703940. To access the webcast, please visit the investor relations section of www.blackrockkelso.com.

PRIOR TO THE WEBCAST/TELECONFERENCE, AN INVESTOR PRESENTATION THAT COMPLEMENTS THE EARNINGS CONFERENCE CALL WILL BE POSTED TO BLACKROCK KELSO CAPITAL’S WEBSITE WITHIN THE PRESENTATIONS SECTION OF THE INVESTOR RELATIONS PAGE ( http://www.blackrockkelso.com/InvestorRelations/Presentations/index.htm).

   
 

BlackRock Kelso Capital Corporation

Consolidated Statements of Assets and Liabilities

(Unaudited)

           
June 30, 2012 December 31, 2011
Assets
Investments at fair value:
Non-controlled, non-affiliated investments (cost of $922,784,492 and $959,635,127) $ 925,770,739 $ 890,691,404
Non-controlled, affiliated investments (cost of $69,270,728 and $59,633,913) 81,685,718 71,035,799
Controlled investments (cost of $146,384,217 and $78,601,629) 158,086,657 87,225,239
 
Total investments at fair value (cost of $1,138,439,437 and $1,097,870,669) 1,165,543,114 1,048,952,442
Cash and cash equivalents 11,473,158 7,478,904
Cash denominated in foreign currencies (cost of $10,007 and $300,380) 10,130 300,089
Unrealized appreciation on forward foreign currency contracts 370,304
Receivable for investments sold 192,556 2,734,705
Interest receivable 18,773,920 16,474,871
Dividends receivable 8,493,799
Prepaid expenses and other assets 5,936,213 6,740,517
 
Total Assets $ 1,202,299,395 $ 1,091,175,327
 
Liabilities
Payable for investments purchased $ 9,866,062 $ 421,597
Unrealized depreciation on forward foreign currency contracts 1,106,241
Debt 449,900,000 343,000,000
Interest payable 5,529,001 5,592,184
Dividend distributions payable 19,124,740 19,040,586
Base management fees payable 5,522,189 5,293,755
Incentive management fees payable 11,878,159
Accrued administrative services 112,951 144,625
Other accrued expenses and payables 5,185,635 3,689,331
 
Total Liabilities 495,240,578 390,166,478
 
Net Assets

Common stock, par value $.001 per share, 200,000,000 common shares authorized,  74,982,208 and 74,636,091 issued and 73,556,701 and 73,210,584 outstanding

74,982 74,636
Paid-in capital in excess of par 986,066,767 983,082,373
Distributions in excess of net investment income (22,973,410) (26,165,703 )
Accumulated net realized loss (270,739,030) (194,505,823 )
Net unrealized appreciation (depreciation) 24,106,184 (51,999,958 )
Treasury stock at cost, 1,425,507 and 1,425,507 shares held (9,476,676 ) (9,476,676 )
 
Total Net Assets 707,058,817 701,008,849
 
Total Liabilities and Net Assets $ 1,202,299,395 $ 1,091,175,327
 
Net Asset Value Per Share $ 9.61 $ 9.58
                 
 

BlackRock Kelso Capital Corporation

Consolidated Statements of Operations (Unaudited)

  Three months

ended June 30, 2012

Three months

ended June 30, 2011

Six months

ended June 30, 2012

Six months

ended June 30, 2011

Investment Income:
Interest income:
Non-controlled, non-affiliated investments

$

28,049,784

$ 22,260,880 $ 54,258,960 $ 43,221,104
Non-controlled, affiliated investments 1,484,764 1,235,193 3,015,943 2,673,978
Controlled investments   1,777,957     1,445,073     3,430,697     2,663,198  
 
Total interest income 31,312,505 24,941,146 60,705,600 48,558,280
Fee income:
Non-controlled, non-affiliated investments 3,708,563 10,578,716 7,088,175 11,080,413
Non-controlled, affiliated investments 66,682 79,716 133,364 158,556
Controlled investments   39,245     39,246     78,491     78,061  
 
Total fee income   3,814,490     10,697,678     7,300,030     11,317,030  
 
Dividend income:
Non-controlled, non-affiliated investments 339,282 1,099,169 667,312 1,668,595
Non-controlled, affiliated investments 368,575 722,792
Controlled investments                
 
Total dividend income   339,282     1,467,744     667,312     2,391,387  
 
Total investment income   35,466,277     37,106,568     68,672,942     62,266,697  
 
Expenses:
Base management fees 5,522,189 4,958,231 10,912,637 9,423,470
Interest and credit facility fees 5,024,200 4,052,052 9,737,143 7,694,271
Incentive management fees 2,213,859
Amortization of debt issuance costs 627,780 627,779 1,255,559 1,236,506
Investment advisor expenses 488,961 435,530 852,646 861,015
Professional fees 384,677 303,457 503,531 662,513
Administrative services 170,203 255,819 252,534 546,621
Director fees 112,797 104,000 233,563 212,269
Other   752,233     630,466     1,304,021     1,014,163  
 
Total expenses   13,083,040     11,367,334     27,265,493     21,650,828  
 
Net Investment Income   22,383,237     25,739,234     41,407,449     40,615,869  
 
Realized and Unrealized Gain (Loss):
Net realized gain (loss):
Non-controlled, non-affiliated investments (75,324,493 ) (33,030 ) (75,335,590 ) (37,331,447 )
Non-controlled, affiliated investments (181,608 ) (317,905 ) (5,069,199 )
Controlled investments 3,443 3,443
Foreign currency   (409,137 )   (678,187 )   (579,712 )   (1,178,263 )
 
Net realized loss   (75,915,238 )   (707,774 )   (76,233,207 )   (43,575,466 )
 
Net change in unrealized appreciation or depreciation on:
Non-controlled, non-affiliated investments 72,311,953 8,226,330 78,884,010 48,881,559
Non-controlled, affiliated investments 2,575,713 3,672,727 1,013,104 10,637,490
Controlled investments (1,153,154 ) 1,412,925 (5,269,379 ) 82,357
Foreign currency translation   779,629     574,934     1,478,407     291,459  
 
Net change in unrealized appreciation or depreciation   74,514,141    

13,886,916

    76,106,142     59,892,865  
 
Net realized and unrealized gain (loss)   (1,401,097 )   13,179,142     (127,065 )   16,317,399  
 
Net Increase in Net Assets Resulting from Operations $ 20,982,140   $ 38,918,376   $ 41,280,384   $ 56,933,268  
 
Net Investment Income Per Share $ 0.30   $ 0.35   $ 0.56   $ 0.56  
 
Earnings Per Share $ 0.29   $ 0.53   $ 0.56   $ 0.78  
 
Basic and Diluted Weighted-Average Shares Outstanding 73,553,800 73,012,910 73,485,712 72,897,293
Dividends Declared Per Share $ 0.26 $ 0.26 $ 0.52 $ 0.58
 

The Company reports its financial results on a GAAP basis; however, management believes that evaluating the Company’s ongoing operating results may be enhanced if investors have additional non-GAAP basis financial measures. Management reviews non-GAAP financial measures to assess ongoing operations and, for the reasons described below, considers them to be effective indicators, for both management and investors, of the Company’s financial performance over time. The Company’s management does not advocate that investors consider such non-GAAP financial measures in isolation from, or as a substitute for, financial information prepared in accordance with GAAP.

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