MVC Capital, Inc. (NYSE: MVC), a publicly traded business development company that makes private equity and debt investments, today announced its financial results for the second fiscal quarter ended April 30, 2011. As of April 30, 2011, the Company's net assets were approximately $414.3 million, or $17.32 per share, compared with net assets of approximately $415.9 million, or $17.33 per share, at the beginning of the quarter and $434.7 million, or $17.89 per share, at the end of the same period last year. During the quarter, the Valuation Committee, which is comprised of three independent directors, adjusted the fair values of 12 portfolio companies, resulting in a net increase of approximately $2.7 million or $0.11 per share. In arriving at these determinations and consistent with the Company's valuation procedures and ASC 820 (formerly FAS 157), the Valuation Committee took into account many factors, including the performance of the portfolio companies, as well as the impact of changes in market multiples within certain sectors and fluctuations in currency valuations. In the second quarter of 2011, the Company earned approximately $2.7 million in interest and dividend income and approximately $1.8 million in fee and other income, representing a decrease in total operating income of approximately $792,000 as compared to the same quarter in 2010. The primary reasons for the decline in total operating income were a result of the prepayment of investments that provide current income, reserves against non-performing loans as well as the reduction in dividend income received from exited portfolio companies. The Company reported net operating income of approximately $65,000 for the second quarter, as compared to a net operating loss of approximately $892,000 for the same quarter in 2010, due primarily to a lower incentive compensation accrual. The Company continued to manage its expenses allowing for similar expense levels across most operating line items (excluding incentive compensation) as compared to the same period last year.
During the quarter, the Company made one new investment into Octagon High Income Cayman Fund LTD in the amount of $3.0 million. Throughout the quarter, the Company continued its efforts to manage its portfolio prudently, including working with its portfolio companies and their management teams to seek to enhance performance and uncover potential exit opportunities."We continue to work diligently to enhance the value of our existing portfolio and to identify the most attractive investment and exit opportunities for our shareholders," said Michael Tokarz, Chairman and Portfolio Manager. "While our NAV remained relatively flat with the prior quarter, we believe we are well positioned to seize upon the numerous investment opportunities in the marketplace given our strong pipeline and cash position." As of April 30, 2011, the Company had 32 investments across 23 industries with approximately 73% of the fair values of those investments held domestically and approximately 27% held internationally. The portfolio breakdown between common equity and yielding investments as of April 30, 2011, was 80% and 20%, respectively. MVC-G About MVC Capital, Inc. MVC is a business development company traded on the New York Stock Exchange that provides long-term debt and equity investment capital to fund growth, acquisitions and recapitalizations of companies in a variety of industries. For additional information about MVC, please visit the MVC's website at www.mvccapital.com. For MVC's investor relations, please call 914-510-9400. All media inquiries should be directed to Nathaniel Garnick at 212-687-8080. Forward-Looking Statements The information contained in this press release contains forward-looking statements. These forward-looking statements are subject to the inherent uncertainties in predicting future results and conditions. Certain factors could cause actual results and conditions to differ materially from those projected in these forward-looking statements, and these factors are enumerated in the company's periodic filings with the Securities and Exchange Commission.