This Day On The Street
Continue to site right-arrow
ADVERTISEMENT
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
TheStreet Open House

BlackRock Kelso Capital Corporation Generates Net Investment Income Adjusted For Pro-Forma Incentive Management Fees Of $0.27 Per Share And $1.08 Per Share For The Three Months And Year Ended December 31, 2012

Stocks in this article: BKCC

Incentive management fees for the three months and year ended December 31, 2012 were $17.3 million and $22.5 million, respectively, as compared to $11.9 million for the three months and year ended December 31, 2011. With respect to incentive management fees based on income, $17.0 million was earned for the annual 2012 period, versus $11.9 million for 2011. The year over year increase is due to an increase in the overall portfolio returns from 11.4% to 12.8%, the factor from which the income based incentive management fees are derived. These returns are computed from the period's distributable net income to shareholders as compared to the beginning of period net asset value. Of the current period totals and new this year, $2.5 million and $5.5 million, respectively, represent incentive management fees accrued based on a hypothetical capital gains calculation, as required by GAAP. A hypothetical liquidation is performed each quarter possibly resulting in an incentive management fee accrual if the amount is positive. It should be noted, however, that a fee so calculated and accrued is not due and payable, if at all, until the end of each measurement period, or every June 30.

Interest and credit facility related expenses were $4.7 million and $19.6 million, respectively, for the three months and year ended December 31, 2012, compared to $4.7 million and $16.6 million for the three months and year ended December 31, 2011. The increase in the 2012 period is mainly a result of increased borrowing levels, as average debt outstanding increased over $90 million from 2011 levels to an average of $381.5 million for 2012.

Expenses also consist of amortization of debt issuance costs, investment advisor expenses, professional fees, administrative services expense, director fees and miscellaneous other expenses.

Net Investment Income

Continuing our positive earnings momentum, net investment income totaled $8.3 million and $73.7 million, or $0.11 per share and $1.00 per share, respectively, for the three months and year ended December 31, 2012. For the three months and year ended December 31, 2011, net investment income totaled $11.3 million and $72.9 million, or $0.15 per share and $1.00 per share, respectively. Our portfolio continues to produce a stable amount of interest and dividend income relative to it's size, and the income based incentive management fee continues to be concentrated in the fourth quarter, producing an uncharacteristically low net investment income per share relative to that for the entire year. Had our incentive management fees been accrued ratably throughout the year rather than heavily weighted in the fourth quarter as is the result when applying GAAP, our net investment income, as adjusted, would have been $0.27 per share and $1.08 per share, respectively, for the three months and year ended December 31, 2012. Alternate presentations of net investment income per share adjusting to normalize this fourth quarter concentration can be found in the Supplemental table on page 9.

4 of 13

Check Out Our Best Services for Investors

Action Alerts PLUS

Jim Cramer and Stephanie Link reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

Jim Cramer's protégé, David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
Try it NOW
Try it NOW
Try it NOW

Check Out Our Best Services for Investors

Dividend Stock Advisor

Jim Cramer's protégé, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Options Profits

Our options trading pros provide over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • Actionable options commentary and news
  • Real-time trading community
Try it NOW
Try it NOW
Try it NOW
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!

Markets

DOW 17,164.95 -251.90 -1.45%
S&P 500 1,994.99 -26.26 -1.30%
NASDAQ 4,635.24 -48.1670 -1.03%

Partners Compare Online Brokers

Free Reports

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs