Hercules Announces Strong Third Quarter Financial Results With $0.32 NII Per Share And A $0.31 Quarterly Dividend

Hercules Capital, Inc. (NYSE: HTGC) ("Hercules" or the "Company"), the leading specialty financing provider to innovative venture growth stage companies backed by leading venture capital firms, today announced its financial results for the third quarter ended September 30, 2016.

The Company also announced that its Board of Directors has declared a third quarter cash dividend of $0.31 per share, that will be payable on November 21, 2016, to shareholders of record as of November 14, 2016.

"Our strong third quarter financial results are a testament to our differentiated business model within the BDC industry," stated Manuel A. Henriquez, chairman and chief executive officer of Hercules. "This proven model culminated in generating our second consecutive quarter of 103.0% NII coverage, appreciation in our NAV, strong and above average seasonal pace of new origination activities and consistent high investment yields while maintaining our historical exceptional credit underwriting and quality. In addition to the strong quarterly income and NII growth, our debt investment portfolio is now approaching our critical targeted inflection point of $1.35 billion, which assuming effective yields in excess of 13.5% (currently at 14.6%) and maintaining NII margins of 52.0% or better (currently 52.7%), we expect to generate NII income at or in excess of our existing 'dividend' distribution of $0.31 and find ourselves in a very advantageous position of having a substantial and growing war chest of undistributed earnings spillover rolling into 2017, assuming no unexpected credit events before year end."

Henriquez continued, "Our team of investment professionals continues to deliver outstanding performance and results, as we pursue our proven 'slow and steady' march towards our desired target of a $1.30 to $1.35 billion debt investment portfolio, which we anticipate achieving by year-end or early January 2017, subject to market conditions and favorable market election outcomes. We ended Q3 with a debt investment portfolio of $1.28 billion, on a cost basis, slightly under our expected target for Q3 and impacted by higher than anticipated early repayments, however, given our existing pipeline of signed term sheets, coupled with our current pipeline of transactions being evaluated, we believe that we are within striking distance of our targeted debt investment portfolio goal which should allow us to achieve or maybe even exceed our target of $1.35 billion by year-end or early January 2017, subject to market conditions."

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