Results of Operations

Total investment income for the quarters ended December 31, 2012 and December 31, 2011 was $51.8 million and $39.5 million, respectively. For the quarter ended December 31, 2012, this amount primarily consisted of $38.6 million of interest income from portfolio investments (which included $3.7 million of PIK interest). For the quarter ended December 31, 2011, this amount primarily consisted of $33.5 million of interest income from portfolio investments (which included $3.4 million of PIK interest). PIK interest represented only 7.2% of total investment income for the quarter ended December 31, 2012, as compared to 8.6% for the quarter ended December 31, 2011.

The increase in our total investment income for the quarter ended December 31, 2012 as compared to the quarter ended December 31, 2011 was primarily attributable to a higher average level of outstanding debt investments, which was principally due to a net increase of 19 debt investments in our portfolio and fee income related to investment activity, partially offset by amortization repayments received and a decrease in the weighted average yield on our debt investments from 12.27% to 11.99% during the year-over-year period.

Expenses for the quarters ended December 31, 2012 and December 31, 2011 were $25.2 million and $19.8 million, respectively. Expenses increased for the quarter ended December 31, 2012 as compared to the quarter ended December 31, 2011, primarily due to increases in the base management fee, the incentive fee and interest expense.

Liquidity and Capital Resources

On October 18, 2012, we issued $75.0 million in aggregate principal amount of our 5.875% senior unsecured notes due 2024 for net proceeds of $72.8 million after deducting underwriting commissions of $2.2 million.

In addition, on November 30, 2012, we amended our ING-led syndicated credit facility to increase the size to $380 million from $230 million, reduce the pricing to LIBOR plus 2.75% per annum and extend the maturity date to November 30, 2016. During December 2012 and January 2013, additional lenders were added to the facility, increasing the size of the facility to $425 million and the number of lenders in the facility to 12.

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