New Mountain Finance Corporation (NYSE: NMFC) (the "Company", "we", "us" or "our") today announced its financial results for the quarter ended June 30, 2013 and reported second quarter Adjusted Net Investment Income of New Mountain Finance Holdings, L.L.C. (the “Operating Company”) of $0.50 per weighted average share. Second quarter Pro-Forma Adjusted Net Investment Income was $0.38 per weighted average share, after deducting $0.12 per weighted average share related to a dividend distribution from its ownership of YP LLC (“YP”) warrants. At June 30, 2013, net asset value (“NAV”) per share was $14.32, an increase of $0.01 per share from March 31, 2013. The Company also announced that its board of directors declared a third quarter 2013 dividend of $0.34 per share, which will be payable on September 30, 2013 to holders of record as of September 16, 2013 and a special dividend of $0.12 per share in connection with the YP distribution, which will be payable on August 30, 2013 to holders of record as of August 20, 2013.
Additionally, during the second quarter we completed a common stock offering that generated approximately $29.1 million in gross proceeds. The Operating Company also amended its credit facility to increase the maximum capacity of the credit facility (the “Holdings Credit Facility”) from $230.0 million to $250.0 million.
Except where noted otherwise, all financial information shown is that of the Operating Company. Also, please note that share and unit are used interchangeably.
Selected Financial Highlights
(in millions, except per share/unit data)
|June 30, 2013|
|NAV per Share/Unit||$||14.32|
|Investment Portfolio Composition||June 30, 2013||Percent of Total|
|Common Equity and Other||5.6||0.5%|
|Three Months Ended June 30, 2013|
|Adjustments||Adjusted||Adjustments - YP||Adjusted|
|Total investment income||$35.1||($0.2)||(1)||$34.9||($6.4)||(3)||$28.5|
|Net investment income||$23.5||($1.9)||(1)(2)||$21.6||($5.1)||(4)||$16.5|
|Net increase in capital resulting from operations||$14.8||$14.8||($5.1)||(4)||$9.7|
|Net investment income per weighted average share||$0.50||($0.12)||$0.38|
|(1) Adjusted to effectively step-up the cost basis of the Operating Company’s existing investments to fair market value at the IPO date. Under GAAP, the Operating Company did not step-up the cost basis of the Operating Company’s existing investments to fair market value at the IPO date. Since the total value of the Operating Company’s investments at the time of the IPO was greater than the investments’ cost basis, a larger amount of amortization of purchase or original issue discount, as well as different amounts in realized gain and unrealized appreciation, may be recognized under GAAP in each period than if the step-up had occurred. The Operating Company tracks the transferred (or fair market) value of each of its investments as of the time of the IPO and, for purposes of the incentive fee calculation, adjusts Pre-Incentive Fee Net Investment Income to reflect the amortization of purchase or original issue discount on the Operating Company’s investments as if each investment was purchased at the date of the IPO, or stepped up to fair market value. The Operating Company also uses the transferred (or fair market) value of each of its investments as of the time of the IPO to adjust capital gains or losses and unrealized capital depreciation.|
|(2) Reclassification of the capital gains incentive fee out of net investment income and into net change in capital resulting from operations of ($1.7) million.|
|(3) Reverse out the gross non-recurring YP distribution of $6.4 million.|
|(4) Reverse out the net non-recurring YP distribution of $5.1 million (net of related incentive fee).|