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BlackRock Kelso Capital Corporation Declares Regular Quarterly Dividend Of $0.26 Per Share, Announces June 30, 2013 Quarterly Financial Results

Dividend Reinvestment Plan

We maintain an “opt out” dividend reinvestment plan for our common stockholders. As a result, if we declare a dividend, stockholders’ cash dividends will be automatically reinvested in additional shares of our common stock, unless they specifically “opt out” of the dividend reinvestment plan so as to receive cash dividends. With respect to our dividends paid to stockholders for the six months ended June 30, 2013 and 2012, dividends reinvested pursuant to our dividend reinvestment plan totaled $2.6 million and $3.0 million, respectively.

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 2013, the repurchase plan was further extended through June 30, 2014, 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, 2013. Since inception of the repurchase plan through June 30, 2013, 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 1, 2013 to discuss its second quarter 2013 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 79034571). 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 5:30 p.m. on Thursday, August 1, 2013 and ending at midnight on Thursday, August 8, 2013. 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 79034571. 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, 2013 December 31, 2012
Assets
Investments at fair value:
Non-controlled, non-affiliated investments (cost of $714,608,812 and $849,028,227) $ 727,324,583 $ 850,511,125
Non-controlled, affiliated investments (cost of $90,152,187 and $50,983,674) 130,937,828 67,750,172
Controlled investments (cost of $114,813,492 and $137,337,392)   150,958,439     143,336,244  
 
Total investments at fair value (cost of $919,574,491 and $1,037,349,293) 1,009,220,850 1,061,597,541
Cash and cash equivalents 43,851,523 9,122,141
Unrealized appreciation on forward foreign currency contracts 369,417
Receivable for investments sold 15,551,952 504,996
Interest receivable 16,365,810 14,048,248
Prepaid expenses and other assets   9,507,016     4,375,527  
 
Total Assets $ 1,094,497,151   $ 1,090,017,870  
 
Liabilities
Payable for investments purchased $ 36,251,309 $ 440,243
Debt 314,857,385 346,850,000
Interest payable 7,504,197 5,277,132
Dividend distributions payable 19,265,446 19,196,418
Base management fees payable 5,189,226 5,626,893
Incentive management fees payable 11,285,066 20,277,930
Accrued administrative services 271,136 277,000
Other accrued expenses and payables   5,422,677     4,692,562  
 
Total Liabilities   400,046,442     402,638,178  
 
Net Assets

Common stock, par value $.001 per share, 200,000,000 common shares authorized,

75,523,371 and 75,257,888 issued and 74,097,864 and 73,832,381 outstanding

75,523 75,258
Paid-in capital in excess of par 921,279,979 917,534,577
Distributions in excess of net investment income (26,602,276 ) (22,291,022 )
Accumulated net realized loss (277,451,631 ) (219,270,607 )
Net unrealized appreciation (depreciation) 86,625,790 20,808,162
Treasury stock at cost, 1,425,507 and 1,425,507 shares held   (9,476,676 )   (9,476,676 )
 
Total Net Assets   694,450,709     687,379,692  
 
Total Liabilities and Net Assets $ 1,094,497,151   $ 1,090,017,870  
 
Net Asset Value Per Share $ 9.37 $ 9.31
 
                           

BlackRock Kelso Capital Corporation

Consolidated Statements of Operations (Unaudited)

Three months

ended June 30, 2013

Three months

ended June 30, 2012

Six months

ended June 30, 2013

Six months

ended June 30, 2012

Investment Income:

 

 

Interest income:

Non-controlled, non-affiliated investments

$

26,914,678

$

28,049,784

$

51,746,787

$

54,258,960
Non-controlled, affiliated investments 1,134,866 1,484,764 2,082,871 3,015,943

Controlled investments

2,394,997 1,777,957 4,938,544 3,430,697
Total interest income

 

30,444,541

 

31,312,505

 

58,768,202

 

60,705,600
Fee income:
Non-controlled, non-affiliated investments

 

4,807,160 3,708,563 7,548,819 7,088,175
Non-controlled, affiliated investments 66,682 133,364
Controlled investments   267,933     39,245     288,680     78,491  
Total fee income   5,075,093     3,814,490     7,837,499     7,300,030  
Dividend income:
Non-controlled, non-affiliated investments 542,750 339,282 586,185 667,312
Non-controlled, affiliated investments 73,839 73,839
Controlled investments                
Total dividend income   616,589     339,282     660,024     667,312  
Total investment income   36,136,223     35,466,277     67,265,725     68,672,942  
 
Expenses:
Base management fees 5,189,226 5,522,189 10,539,182 10,912,637
Interest and credit facility fees 4,915,024 5,024,200 9,673,040 9,737,143
Incentive management fees 2,069,605 7,333,715 2,213,859
Amortization of debt issuance costs 496,542 627,780 862,548 1,255,559
Investment advisor expenses 482,745 488,961 1,040,843 852,646
Professional fees 476,223 384,677 1,106,420 503,531
Administrative services 181,825 170,203 433,141 252,534
Director fees 161,500 112,797 279,500 233,563
Other   943,679     752,233     1,813,404     1,304,021  
 
Total expenses   14,916,369     13,083,040     33,081,793     27,265,493  
 
Net Investment Income   21,219,854     22,383,237     34,183,932     41,407,449  
 
Realized and Unrealized Gain (Loss):
Net realized gain (loss):
Non-controlled, non-affiliated investments (26,340,317 ) (75,324,493 ) (26,287,812 ) (75,335,590 )
Non-controlled, affiliated investments (181,608 ) 21 (317,905 )
Controlled investments (32,659,817 ) (32,660,160 )
Foreign currency   605,768     (409,137 )   766,927     (579,712 )
 
Net realized loss   (58,394,366 )   (75,915,238 )   (58,181,024 )   (76,233,207 )
 
Net change in unrealized appreciation or depreciation on:
Non-controlled, non-affiliated investments 16,270,922 72,311,953 22,003,879 78,884,010
Non-controlled, affiliated investments 9,604,746 2,575,713 24,019,143 1,013,104
Controlled investments 23,958,104 (1,153,154 ) 20,180,439 (5,269,379 )
Foreign currency translation   (635,863 )   779,629     (385,833 )   1,478,407  
 
Net change in unrealized appreciation or depreciation   49,197,909     74,514,141     65,817,628     76,106,142  
 
Net realized and unrealized gain (loss)   (9,196,457 )   (1,401,097 )   7,636,604     (127,065 )
 
Net Increase in Net Assets Resulting from Operations $ 12,023,397   $ 20,982,140   $ 41,820,536   $ 41,280,384  
 
Net Investment Income Per Share – basic $ 0.29   $ 0.30   $ 0.46   $ 0.56  
 
Earnings Per Share - basic $ 0.16   $ 0.29   $ 0.56   $ 0.56  
 
Weighted-Average Shares Outstanding - basic   74,096,355     73,553,800     74,027,408     73,485,712  
 
Net Investment Income Per Share - diluted $ 0.27   $ 0.30   $ 0.45   $ 0.56  
 
Earnings Per Share - diluted $ 0.16   $ 0.29   $ 0.54   $ 0.56  
 
Weighted-Average Shares Outstanding - diluted   83,993,082     73,553,800     81,190,233     73,485,712  
 
Dividends Declared Per Share $ 0.26 $ 0.26 $ 0.52 $ 0.52
 

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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