EXHIBIT 99.1
Published on May 7, 2008
Exhibit 99.1
3600 Glenwood Ave., Ste. 104 Raleigh, NC 27612 |
TRIANGLE CAPITAL CORPORATION REPORTS FIRST QUARTER
2008 RESULTS, INCREASES DIVIDEND TO $0.31 PER SHARE, AND
ANNOUNCES OVER $31.0 MILLION OF NEW INVESTMENTS
2008 RESULTS, INCREASES DIVIDEND TO $0.31 PER SHARE, AND
ANNOUNCES OVER $31.0 MILLION OF NEW INVESTMENTS
RALEIGH, NC May 7, 2008, Triangle Capital Corporation (NASDAQ: TCAP) (Triangle or
the Company), a leading specialty finance company that provides customized financing
solutions to lower middle market companies located throughout the United States, today
announced its results for the first quarter of 2008 and announced a quarterly dividend
of $0.31 per share, representing a 106.7% increase over the
Companys dividend during the same period in 2007.
In describing the Companys performance, Garland S. Tucker, III, President and CEO,
stated, Triangle is off to a great start in 2008. With $14.1 million of new
investments during March and over $31.0 million of new investments already in the
second quarter, our investment pace is significantly ahead of schedule and evidences
the attractive opportunities we continue to see in our target market. In addition to
our investing activity, we are pleased to report our fifth consecutive quarterly
dividend increase since our IPO.
First Quarter 2008 Results
Total investment income during the first quarter of 2008 was $3.9 million, compared to
total investment income of $2.1 million for the first quarter of 2007, representing an
increase of 82.9%. The Companys increase in investment income is primarily
attributed to an increase in portfolio interest from March 31, 2007 to March 31, 2008.
Net investment income during the first quarter of 2008 was $1.9 million, compared to
net investment income of $0.8 million for the first quarter of 2007, representing an
increase of 137.8%. Net investment income per share during the first quarter of 2008
was $0.28 compared to $0.12 during the first quarter of 2007. The Companys increase
in net investment income during the first quarter of 2008 was the result of a $1.8
million increase in total investment income offset by a $0.6 million increase in
expenses, primarily associated with the addition of personnel and costs associated
with operating a public company.
The Companys net increase in net assets resulting from operations was $0.8 million
during the first quarter of 2008, as compared to $1.1 million during the first quarter
of 2007. The Companys net increase in net assets resulting from operations was $0.11
per share during the first quarter of 2008 as compared to $0.16 per share during the
first quarter of 2007.
The Company recorded no realized gains or losses on investments in the three months
ended March 31, 2008. For the three months ended March 31, 2007, net realized loss on
investments was $1.5 million which related to a realized loss on one investment. In
the three months ended March 31, 2008, the Company recorded net unrealized
depreciation of investments in the amount
of $1.0 million, comprised of unrealized gains on seven investments totaling $0.7
million and unrealized losses on nine investments totaling $1.7 million. During the
three months ended March 31, 2007, the Company recorded net unrealized appreciation of
investments in the amount of $1.7 million, comprised primarily of an unrealized gain
reclassification adjustment of approximately $1.5 million related to the realized loss
noted above. In addition, in the three months ended March 31, 2007, Triangle recorded
unrealized gains on eleven other investments totaling $0.9 million and unrealized
losses on five investments totaling $0.6 million.
The Companys net asset value per share at March 31, 2008, was $13.85 as compared to
the Companys net asset value per share at March 31, 2007, of $13.57. As of March 31,
2008, the Companys weighted average yield on all of its outstanding debt investments
was approximately 13.7%.
Dividend Information
Triangles board of directors has declared a cash dividend of $0.31 per share. The
dividend will be payable as follows:
Record Date: June 5, 2008
Payment Date: June 26, 2008
Payment Date: June 26, 2008
Commenting on the Companys dividend, Steven C. Lilly, Chief Financial Officer stated,
Our dividend of $0.31 per share equates to an annualized
dividend yield of 11.2%
based on todays closing price. Our existing dividend yield, coupled with the more
than $40.0 million of net new investments we have made during 2008, provide
substantial visibility toward future dividend growth.
Triangle has adopted a dividend reinvestment plan (DRIP) that provides for
reinvestment of dividends on behalf of its stockholders, unless a
stockholder elects
to receive cash. As a result, when the Company declares a cash
dividend, stockholders
who have not opted out of the DRIP will have their cash dividends automatically
reinvested in additional shares of the Companys common stock, rather than receiving
cash dividends.
When the Company declares and pays dividends, it determines the allocation of the
distribution between current income, accumulated income and return of capital on the
basis of accounting principles generally accepted in the United States (GAAP). At
each year end, the Company is required for tax purposes to determine the dividend
allocation based on tax accounting principles. Due to differences between GAAP and
tax accounting principles, the portion of each dividend distribution that is ordinary
income, capital gain or return of capital may differ for GAAP and tax purposes.
Recent Portfolio Investments
During the first quarter of 2008, as previously announced, the Company made
investments totaling $14.1 million consisting of
$1.2 million in senior debt, $11.6
million in subordinated debt, and $1.3 million in equity. Since March 31, 2008, the
Company has made investments totaling $31.1 million, of which $29.7 million was
subordinated debt and $1.4 million was convertible debt. Also subsequent to quarter
end, Triangle received a $3.8 million loan repayment of a subordinated debt
investment.
New investments and repayments since December 31, 2007 are summarized as follows:
On March 6, 2008, Triangle closed a $5.5 million investment in AssetPoint, LLC
(AssetPoint) consisting of $4.3 million in subordinated debt, $0.5 million in
equity, and a commitment to fund additional subordinated debt of $0.7 million, which
was funded on April 23, 2008. AssetPoint, headquartered in Greenville, South Carolina,
has been a pioneer in delivering integrated enterprise asset management and
computerized maintenance management software and services that improve profitability
and productivity for the process and manufacturing industries.
On March 7, 2008, the Company closed a $4.3 million investment in Electronic Systems
Protection, Inc. (ESP) comprised of $1.0 million in senior debt, $3.0 million in
subordinated debt, and $0.3 million in equity. ESP, headquartered in Zebulon, NC, is
one of the leading manufacturers of power protection technology for the office
technology industry.
On March 31, 2008, Triangle made a $4.7 million investment in TrustHouse Services
Group, Inc. (TrustHouse). The investment consisted of $4.2 million in subordinated
debt and $0.5 million in equity. TrustHouse provides outsourced food management
services to educational institutions, healthcare facilities and businesses primarily
in the Northeast, Mid-Atlantic and Midwestern regions of the U.S.
On April 17, 2008, the Company received a principal repayment of a subordinated debt
investment in Flint Acquisition Corporation (Flint) of $3.8 million. Triangle
received a prepayment fee, and continues to own $1.1 million of equity in Flint at
fair value as of March 31, 2008.
On April 25, 2008, the Company invested $9.4 million in Jenkins Restoration, Inc.
(Jenkins) consisting of $8.0 million in subordinated debt and $1.4 million in
convertible debt. Jenkins, headquartered in Sterling, Virginia, is a provider of
insurance restoration services, focusing on reconstruction and repair of damage to
residential and commercial buildings caused by fire, wind, storm, vandalism, or
burglary.
On April 29, 2008, the Company made an $8.0 million subordinated debt investment in
American De-Rosa Lamparts, LLC (ADL). ADL headquartered in Commerce, California,
markets a wide variety of lighting products, including fixtures, bulbs, electrical
components, glass, and hardware, to maintenance and repair organizations, lighting
wholesalers, retailers, and original equipment manufacturers.
On April 30, 2008, Triangle invested $13.0 million in subordinated debt in Yellowstone
Landscape Group, Inc. (Yellowstone). Yellowstone, headquartered in Dallas, Texas,
is a full-service lawn care provider focused primarily on the commercial market with
services including lawn and landscape maintenance, construction/installation,
irrigation, turf management, and tree care throughout Texas and the Southeast.
Important Disclosures Relating to Financial Statement Presentation
Certain financial data for prior periods, including data for the three months ended
March 31, 2007, are included in this press release. In accordance with Statement of
Financial Accounting Standards No. 141, Business Combinations (SFAS 141), the
Companys results of operations for the three months ended March 31, 2007, are
presented as if the Companys initial public offering and related formation
transactions had occurred as of January 1, 2007.
About Triangle Capital Corporation
Triangle Capital Corporation (www.TCAP.com) is a specialty finance company organized
to provide customized financing solutions to lower middle market companies located
throughout the United States. Triangles investment objective is to seek attractive
returns by generating current income from debt investments and capital appreciation
from equity related investments. Triangles investment philosophy is to partner with
business owners, management teams and financial sponsors to provide flexible financing
solutions to fund growth, changes of control, or other corporate events. Triangle
typically invests $5.0 $15.0 million per transaction in companies with annual
revenues between $20.0 and $75.0 million and EBITDA between $2.0 and $10.0 million.
Triangle has elected to be treated as a business development company under the
Investment Company Act of 1940 (1940 Act). Triangle is required to comply with a
series of regulatory requirements under the 1940 Act as well as applicable NASDAQ,
federal and state laws and regulations. Triangle intends to elect to be treated as a
regulated investment company under the Internal Revenue Code of 1986. Failure to
comply with any of the laws and regulations that apply to Triangle could have a
material adverse effect on Triangle and its stockholders.
This press release may contain forward-looking statements within the meaning of the
Private Securities Litigation Reform Act of 1995. Any such statements, other than
statements of historical fact, are likely to be affected by other unknowable future
events and conditions, including elements of the future that are or are not under the
Companys control, and that the Company may or may not have considered; accordingly,
such statements cannot be guarantees or assurances of any aspect of future
performance. Actual developments and results are highly likely to vary materially
from these estimates and projections of the future. Such statements speak only as of
the time when made, and the Company undertakes no obligation to update any such
statement now or in the future.
Contacts
Sheri B. Colquitt
Vice President, Investor Relations
919-719-4784
scolquitt@tcap.com
Vice President, Investor Relations
919-719-4784
scolquitt@tcap.com
Steven C. Lilly
Chief Financial Officer
919-719-4789
slilly@tcap.com
Chief Financial Officer
919-719-4789
slilly@tcap.com
# # #
TRIANGLE CAPITAL CORPORATION
Consolidated Balance Sheets
Consolidated Balance Sheets
March 31, | December 31, | |||||||
2008 | 2007 | |||||||
(Unaudited) | ||||||||
Assets |
||||||||
Investments at fair value: |
||||||||
NonControl / NonAffiliate investments (cost
of $78,569,772 and $66,819,386 at March 31, 2008
and December 31, 2007, respectively) |
$ | 79,704,224 | $ | 69,078,281 | ||||
Affiliate investments (cost of $29,431,381 and $24,487,895
at March 31, 2008 and December 31, 2007,
respectively) |
29,866,379 | 25,041,093 | ||||||
Control investments (cost of $13,430,867 and $15,910,498
at March 31, 2008 and December 31, 2007,
respectively) |
17,821,613 | 20,254,844 | ||||||
Total investments at fair value |
127,392,216 | 114,374,218 | ||||||
Deferred loan origination revenue |
(1,571,822 | ) | (1,368,603 | ) | ||||
Cash and cash equivalents |
15,611,011 | 21,787,750 | ||||||
Interest and fees receivable |
404,084 | 305,159 | ||||||
Prepaid expenses and other current assets |
177,962 | 47,477 | ||||||
Deferred financing fees |
1,752,488 | 999,159 | ||||||
Property and equipment, net |
32,916 | 34,166 | ||||||
Total assets |
$ | 143,798,855 | $ | 136,179,326 | ||||
Liabilities |
||||||||
Accounts payable and accrued liabilities |
$ | 643,633 | $ | 1,144,222 | ||||
Interest payable |
185,999 | 698,735 | ||||||
Dividends payable |
| 2,041,159 | ||||||
Income taxes payable |
95,580 | 52,598 | ||||||
Deferred income taxes |
1,585,899 | 1,760,259 | ||||||
SBA guaranteed debentures payable |
47,050,000 | 37,010,000 | ||||||
Total liabilities |
49,561,111 | 42,706,973 | ||||||
Net Assets |
||||||||
Common stock, $0.001 par value per share (150,000,000
shares authorized, 6,803,863 shares issued and
outstanding as of March 31, 2008 and December 31, 2007) |
6,804 | 6,804 | ||||||
Additional paid-in capital |
86,949,189 | 86,949,189 | ||||||
Investment income in excess of distributions |
3,526,071 | 1,738,797 | ||||||
Accumulated realized losses on investments |
(618,620 | ) | (618,620 | ) | ||||
Net unrealized appreciation of investments |
4,374,300 | 5,396,183 | ||||||
Total net assets |
94,237,744 | 93,472,353 | ||||||
Total liabilities and net assets |
$ | 143,798,855 | $ | 136,179,326 | ||||
Net asset value per share |
$ | 13.85 | $ | 13.74 | ||||
TRIANGLE CAPITAL CORPORATION
Unaudited Statements of Operations
Unaudited Statements of Operations
Three Months | Three Months | |||||||
Ended | Ended | |||||||
March 31, 2008 | March 31, 2007 | |||||||
(Consolidated) | (Combined) | |||||||
Investment income: |
||||||||
Loan interest, fee and dividend income: |
||||||||
NonControl / NonAffiliate investments |
$ | 1,921,769 | $ | 1,155,622 | ||||
Affiliate investments |
748,766 | 274,614 | ||||||
Control investments |
487,434 | 75,718 | ||||||
Total loan interest, fee and dividend income |
3,157,969 | 1,505,954 | ||||||
Paidinkind interest income: |
||||||||
NonControl / NonAffiliate investments |
296,636 | 174,796 | ||||||
Affiliate investments |
142,552 | 29,250 | ||||||
Control investments |
129,395 | 42,948 | ||||||
Total paidinkind interest income |
568,583 | 246,994 | ||||||
Interest income from cash and cash equivalent investments |
137,432 | 359,168 | ||||||
Total investment income |
3,863,984 | 2,112,116 | ||||||
Expenses: |
||||||||
Interest expense |
561,815 | 499,691 | ||||||
Amortization of deferred financing fees |
40,141 | 27,108 | ||||||
Management fees |
| 232,423 | ||||||
General and administrative expenses |
1,348,333 | 548,164 | ||||||
Total expenses |
1,950,289 | 1,307,386 | ||||||
Net investment income |
1,913,695 | 804,730 | ||||||
Net realized loss on investment Non Control / NonAffiliate |
| (1,464,224 | ) | |||||
Net unrealized appreciation (depreciation) of investments |
(1,021,883 | ) | 1,725,329 | |||||
Total net gain (loss) on investments before income taxes |
(1,021,883 | ) | 261,105 | |||||
Income tax expense |
126,421 | | ||||||
Net increase in net assets resulting from operations |
$ | 765,391 | $ | 1,065,835 | ||||
Net investment income per share basic and diluted |
$ | 0.28 | $ | 0.12 | ||||
Net increase in net assets resulting from operations per
share basic and diluted |
$ | 0.11 | $ | 0.16 | ||||
Weighted average number of shares outstanding basic and
diluted |
6,803,863 | 6,686,760 | ||||||
TRIANGLE CAPITAL CORPORATION
Unaudited Statements of Cash Flows
Unaudited Statements of Cash Flows
Three Months | Three Months | |||||||
Ended | Ended | |||||||
March 31, | March 31, | |||||||
2008 | 2007 | |||||||
(Consolidated) | (Combined) | |||||||
Cash flows from operating activities: |
||||||||
Net increase in net assets resulting from operations |
$ | 765,391 | $ | 1,065,835 | ||||
Adjustments to reconcile net increase in net assets resulting
from operations to net cash provided by (used in) operating
activities: |
||||||||
Purchases of portfolio investments |
(14,123,791 | ) | (63,602 | ) | ||||
Repayments received/sales of portfolio investments |
475,404 | 1,424,112 | ||||||
Loan origination and other fees received |
403,889 | 27,500 | ||||||
Net realized loss on investments |
| 1,464,224 | ||||||
Net unrealized depreciation (appreciation) of investments |
1,196,243 | (1,725,329 | ) | |||||
Deferred income taxes |
(174,360 | ) | | |||||
Paidinkind interest accrued, net of payments received |
(541,434 | ) | (142,908 | ) | ||||
Amortization of deferred financing fees |
40,141 | 27,108 | ||||||
Recognition of loan origination and other fees |
(200,670 | ) | (47,057 | ) | ||||
Accretion of loan discounts |
(24,420 | ) | (51,953 | ) | ||||
Depreciation expense |
3,265 | 358 | ||||||
Changes in operating assets and liabilities: |
||||||||
Interest and fees receivable |
(98,925 | ) | (46,782 | ) | ||||
Prepaid expenses |
(130,485 | ) | (70,892 | ) | ||||
Accounts payable and accrued liabilities |
(500,589 | ) | (234,839 | ) | ||||
Interest payable |
(512,736 | ) | (449,456 | ) | ||||
Income taxes payable |
42,982 | |||||||
Receivable from / payable to Triangle Capital Partners, LLC |
| (48,687 | ) | |||||
Net cash provided by (used in) operating activities |
(13,380,095 | ) | 1,127,632 | |||||
Cash flows from investing activities: |
||||||||
Purchases of property and equipment |
(2,015 | ) | (12,905 | ) | ||||
Net cash used in investing activities |
(2,015 | ) | (12,905 | ) | ||||
Cash flows from financing activities: |
||||||||
Borrowings under SBA guaranteed debentures payable |
10,040,000 | 4,000,000 | ||||||
Financing fees paid |
(793,470 | ) | (97,000 | ) | ||||
Proceeds from initial public offering, net of expenses |
| 64,728,037 | ||||||
Change in deferred offering costs |
| 1,020,646 | ||||||
Cash dividends paid |
(2,041,159 | ) | | |||||
Tax distribution to partners |
| (531,566 | ) | |||||
Net cash provided by financing activities |
7,205,371 | 69,120,117 | ||||||
Net increase (decrease) in cash and cash equivalents |
(6,176,739 | ) | 70,234,844 | |||||
Cash and cash equivalents, beginning of period |
21,787,750 | 2,556,502 | ||||||
Cash and cash equivalents, end of period |
$ | 15,611,011 | $ | 72,791,346 | ||||
Supplemental disclosure of cash flow information: |
||||||||
Cash paid for interest |
$ | 1,074,552 | $ | 949,148 | ||||
Summary of non-cash financing transactions: |
||||||||
Accrued tax distribution to partners |
$ | | $ | 220,047 | ||||