- Net investment income ("NII") and realized capital gains of $0.60 per weighted average common share 1.
- NAV per common share of $17.13 as of March 31, 2017.
- Net income (inclusive of unrealized mark-to-market losses) of $0.8 million, or $0.05 per weighted average common share.
- Weighted average effective yield of the Company's collateralized loan obligation ("CLO") equity portfolio was 16.21% as of March 31, 2017.
- Deployed $13.8 million in net capital and received $28.9 million in cash distributions from the Company's portfolio in the first quarter of 2017.
- Nine of the Company's CLOs refinanced their debt tranches and one CLO was reset.
- Began paying monthly distributions of $0.20 per common share in March 2017, switching from prior quarterly distributions of $0.60 per common share.
- NAV per common share of $17.71 as of April 30, 2017 based on management's estimate.
- Deployed $43.9 million in net capital from April 1, 2017 to May 15, 2017; received cash distributions from the Company's portfolio of $29.3 million over the same period.
- Completed follow-on offering of 1.553 million shares (including full exercise of the underwriters' overallotment option), resulting in net proceeds to the Company of approximately $28.7 million.
FIRST QUARTER 2017 RESULTSThe Company's NII and realized capital gains for the quarter ended March 31, 2017 was $0.60 per weighted average common share, compared to $0.58 per weighted average common share for the quarter ended December 31, 2016 (excluding a one-time excise tax charge of $0.04 per common share), and $0.61 per weighted average common share for the quarter ended March 31, 2016. For the quarter ended March 31, 2017, the Company recorded net income of $0.8 million, or $0.05 per weighted average common share. Net income was comprised of total investment income of $16.1 million, and realized capital gains on investments of $1.3 million, partially offset by total expenses of $7.6 million and net unrealized depreciation (or unrealized mark-to-market loss on investments) of $9.0 million. NAV as of March 31, 2017 was $282.5 million, or $17.13 per common share, a decrease of $0.35 per common share from the Company's NAV as of December 31, 2016, but an increase of $4.11 per common share from the Company's NAV as of March 31, 2016. During the quarter ended March 31, 2017, the Company deployed $51.4 million in gross capital which included $30.5 million in CLO equity investments. The weighted average effective yield of new CLO equity investments made by the Company during the quarter was 16.30% as measured at the time of investment. The weighted average effective yield of these CLO equity investments includes a provision for credit losses. Additionally, during the quarter, the Company received $37.6 million of proceeds from the sales of investments, resulting in $1.3 million of net realized gains, and converted one of its existing loan accumulation facilities into a new CLO. Two of the Company's CLO investments were called during the quarter. During the quarter ended March 31, 2017, the Company received $28.9 million of cash distributions from its investment portfolio (including the two CLO equity investments that were called), or $1.75 per weighted average common share.
As of March 31, 2017, the weighted average effective yield on the Company's CLO equity portfolio was 16.21%, compared to 17.48% as of December 31, 2016 and 16.77% as of March 31, 2016.PORTFOLIO STATUS As of March 31, 2017 on a look-through basis, and based on the most recent CLO trustee reports received by such date, the Company had indirect exposure to approximately 1,172 unique corporate obligors. The largest look-through obligor represented 1.0% of the Company's CLO equity and loan accumulation facility portfolio. The top-ten largest look-through obligors together represented 6.9% of the Company's CLO equity and loan accumulation facility portfolio. As of March 31, 2017, the Company had debt and preferred securities outstanding which totaled approximately 35% of its total assets (less current liabilities). SECOND QUARTER 2017 PORTFOLIO ACTIVITY THROUGH MAY 15, 2017 AND OTHER UPDATES From April 1, 2017 through May 15, 2017, the Company received cash distributions on its investment portfolio totaling $29.3 million, or $1.66 per weighted average common share. Also from April 1, 2017 through May 15, 2017, the Company made net new investments totaling $43.9 million, which includes investments in one primary CLO equity security, one new loan accumulation facility and $11.7 million in secondary market investments. As of May 15, 2017, some of the Company's investments had not yet reached their payment date for the quarter. The Company continues to be active as it pursues its refinancing and reset pipeline. In the second quarter, through May 15, 2017, one CLO in the Company's portfolio priced a debt refinancing and another CLO was reset. As of May 15, 2017, the Company has approximately $26.5 million of cash available for investment. As published on the Company's website earlier this month, management's estimate of its NAV per common share as of April 30, 2017 is $17.71.
PREVIOUSLY DECLARED DISTRIBUTIONSEarlier this year, the Company announced its intention to pay monthly distributions and began paying $0.20 per common share each month, converting from prior quarterly distributions of $0.60. For the three months ended March 31, 2017, the Company declared and paid distributions on common stock of $0.40 per common share - the difference from the previous quarterly amount was simply due to the timing of the conversion and there were no missed distributions. The Company also paid a monthly distribution of $0.20 per common share on April 28, 2017 to stockholders of record as of April 17, 2017. Additionally, and as previously announced, the Company declared a distribution of $0.20 per share of common stock payable on May 31, 2017 to stockholders of record as of May 15, 2017. The Company paid distributions of $0.161459 per share of the Company's 7.75% Series A Term Preferred Stock due 2022 (the "Series A Term Preferred Stock") (NYSE: ECCA) and Series B Term Preferred Stock due 2026 (the "Series B Term Preferred Stock") (NYSE: ECCB) on April 28, 2017, to stockholders of record as of April 17, 2017. The distributions represented a 7.75% annualized rate, based on both the Series A and Series B Term Preferred Stocks' $25 liquidation preference per share. Additionally, and as previously announced, the Company declared distributions of $0.161459 per share on its Series A Term Preferred Stock and Series B Term Preferred Stock, payable on each of May 31, 2017 and June 30, 2017, to stockholders of record as of May 15, 2017 and June 15, 2017, respectively. SPECIAL DISTRIBUTION As one of the requirements for the Company to maintain its ability to be taxed as a "regulated investment company" (which it has elected to be), the Company is generally required to pay distributions to holders of its common stock in an amount equal to substantially all of the Company's taxable income within one year of the end of its tax year, which is November 30.
The Company currently estimates its taxable income for the tax year ending November 30, 2016 will exceed aggregate quarterly distributions paid to common stockholders with respect to such year. At present, management estimates a special distribution of $0.55 to $0.70 per common share will be required to meet the distribution requirement described above - the range is estimated based on the increased number of shares of common stock outstanding today as compared to the number of such shares outstanding in prior periods. This estimate remains subject to revision as the actual amount required to be distributed will not be known until the Company files its tax returns and the distribution amount may deviate from the above estimated range.Management expects to target payment of special distributions pertaining to the Company's November 30, 2016 tax year in one or more installments toward the latter part of 2017. During the fourth quarter of 2016, the Company incurred a 4% excise tax in connection with the special distribution. CONFERENCE CALL The Company will host a conference call at 10:00 a.m. (Eastern Time) today to discuss the Company's financial results for the quarter ended March 31, 2017, as well as a portfolio update. All interested parties may participate in the conference call by dialing (877) 201-0168 (domestic) or (647) 788-4901 (international), and entering Conference ID 11017420 approximately 10 to 15 minutes prior to the call. An archived replay of the call will be available shortly afterwards until June 23, 2017. To hear the replay, please dial (800) 585-8367 (domestic) or (416) 621-4642 (international). For the replay, enter conference ID 11017420. ADDITIONAL INFORMATION The Company has made available on its website, http://eaglepointcreditcompany.com (in the financial statements and reports section) its unaudited consolidated financial statements as of and for the period ended March 31, 2017. The Company has also filed this report with the Securities and Exchange Commission. The Company also published on its website (in the investor presentations and portfolio information section) an investor presentation which contains additional information about the Company and its portfolio as of and for the quarter ended March 31, 2017. ABOUT EAGLE POINT CREDIT COMPANY The Company is a non-diversified, closed-end management investment company. The Company's investment objectives are to generate high current income and capital appreciation primarily through investment in equity and junior debt tranches of collateralized loan obligations. The Company is externally managed and advised by Eagle Point Credit Management LLC. The principals of Eagle Point Credit Management LLC are Thomas P. Majewski, Daniel W. Ko and Daniel M. Spinner.
The Company makes certain unaudited portfolio information available each month on its website in addition to making certain other unaudited financial information available on its website ( www.eaglepointcreditcompany.com). This information includes (1) an estimated range of the Company's net investment income ("NII") and realized capital gains or losses per weighted average share of common stock for each calendar quarter end, generally made available within the first fifteen days after the applicable calendar month end, (2) an estimated range of the Company's NAV per share of common stock for the prior month end and certain additional portfolio-level information, generally made available within the first fifteen days after the applicable calendar month end, and (3) during the latter part of each month, an updated estimate of NAV, if applicable, and, with respect to each calendar quarter end, an updated estimate of the Company's NII and realized capital gains or losses for the applicable quarter, if available.FORWARD-LOOKING STATEMENTS This press release may contain "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Statements other than statements of historical facts included in this press release may constitute forward-looking statements and are not guarantees of future performance or results and involve a number of risks and uncertainties. Actual results may differ materially from those in the forward-looking statements as a result of a number of factors, including those described in the Company's filings with the U.S. Securities and Exchange Commission ("SEC"). The Company undertakes no duty to update any forward-looking statement made herein. All forward-looking statements speak only as of the date of this press release. FURTHER INFORMATION REGARDING ESTIMATED TAX INFORMATION The estimates of the Company's taxable income and distributions for the tax year ended November 30, 2016 reflects management's judgment as of the date of this press release of conditions it expects to exist and the course of action it expects the Company to take with respect to the tax year ended November 30, 2016. The estimates are based on taxable income reported to date and assumptions relating to the underlying tax characteristics of income and other items as reported to the Company. Although the Company considers its assumptions to be reasonable as of the date of this press release, such assumptions are subject to a wide variety of significant uncertainties that could cause actual results to differ materially from those contained in the estimates, including risks and uncertainties relating to the completeness and accuracy of preliminary information reported or received by the Company from underlying investments, and those described in the notes to the Company's audited consolidated financial statements for the fiscal year ended December 31, 2016 and the Company's unaudited consolidated financial statements for the fiscal quarter ended March 31, 2017. Accordingly, there can be no assurance that actual results will not differ materially from those presented in the estimates. The estimate of taxable income was prepared on a reasonable basis and reflects the best currently available estimates and judgment of Company management. However, this estimate is not fact and readers of this press release should not rely upon this information or place undue reliance on such estimate. Neither the Company's independent registered public accounting firm nor any other independent accountants has compiled, examined or performed any procedures with respect to estimated information contained herein, or expressed any opinion or assurance with respect to the estimated information or its achievability, and accordingly each assumes no responsibility for, and disclaims any association with, the estimates.
|1 "Per weighted average common share" data are on a weighted average basis based on the average daily number of shares outstanding for the period.|