SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of report (Date of earliest event reported): August 8, 2016
CAPITAL SOUTHWEST CORPORATION
(Exact Name Of Registrant As Specified In Charter)
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Texas |
814-00061 |
75-1072796 |
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(State or Other Jurisdiction of Incorporation) |
(Commission File Number) |
(IRS Employer Identification No.) |
5400 Lyndon B. Johnson Freeway, Suite 1300
Dallas, Texas 75240
(Address of Principal Executive Offices) (Zip Code)
Registrant’s telephone number, including area code: (972) 233-8242
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):
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Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
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Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
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Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
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Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Item 2.02 Results of Operations and Financial Condition.
On August 8, 2016, Capital Southwest Corporation (the “Company”) issued a press release, a copy of which has been furnished as Exhibit 99.1 hereto.
The information furnished in this Current Report on Form 8-K under Item 2.02, including Exhibit 99.1, shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1934, except as shall be expressly set forth by reference in a future filing.
Item 7.01 Regulation FD Disclosure.
The Company expects to hold a conference call with analysts and investors on August 9, 2016. A copy of the investor presentation slides to be used by the Company on such conference call is furnished as Exhibit 99.2 to this Form 8-K and incorporated herein by reference.
The information set forth under this Item 7.01, including Exhibit 99.2, is being furnished and shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933, except as shall be expressly set forth by specific reference in such filing.
Item 9.01 Financial Statements and Exhibits
(d) Exhibits
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Exhibit No. |
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Description |
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99.1 |
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Press release issued by Capital Southwest Corporation on August 8, 2016 |
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99.2 |
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Investor presentation slides |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
Dated: August 8, 2016
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By: |
/s/ Bowen S. Diehl |
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Name: Bowen S. Diehl |
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Title: Chief Executive Officer and President |
EXHIBIT INDEX
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Exhibit No. |
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Description |
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Press release issued by Capital Southwest Corporation on August 8, 2016 |
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Investor presentation slides |
Exhibit 99.1
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Lincoln Centre Tower I 5400 Lyndon B. Johnson Freeway, Suite 1300 Dallas, Texas 75240 T 214.238.5700 F 214.238.5701 |
Capital Southwest Announces Financial Results for First Fiscal Quarter Ended June 30, 2016
CSWC Grows Pre-Tax Net Investment Income to $0.06 Per Share
Dallas, Texas – August 8, 2016 – Capital Southwest Corporation (“Capital Southwest” or the “Company”; Nasdaq: CSWC) today announced its financial results for the first fiscal quarter ended June 30, 2016.
First Quarter Fiscal Year 2017 Financial Highlights
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Total Investment Portfolio: $175.9 million |
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Total Credit Portfolio: $83.7 million |
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Total Equity Portfolio, excluding I-45 SLF: $51.1 million |
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I-45 SLF investment portfolio grew to $134.5 million from $99.2 million |
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I-45 SLF portfolio consists of 98% 1st Lien Debt in 32 credits |
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Total Capital Southwest investment in I-45 SLF: $41.1 million |
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Pre-Tax Net Investment Income of $0.9 million, or $0.06 per weighted average diluted share |
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Dividends paid: $0.06 per share |
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Principal repayment proceeds: $11.1 million |
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Freedom Truck Finance ($6 million proceeds / 14.3% IRR) |
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Bob’s Discount Furniture ($5 million proceeds / 15.1% IRR) |
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Total Cash: $97.0 million |
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Net Realized and Unrealized Portfolio Appreciation (Depreciation): $2.3 million |
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Total Net Assets: $273.3 million |
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Net Asset Value per Share: $17.39 |
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Weighted Average Yield on Debt Investments: 10.08% |
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No investment assets currently on non-accrual |
In commenting on the Company's results, Bowen Diehl, President and Chief Executive Officer, stated, “Our Upper Middle Market business saw nice growth as I-45 provided a levered vehicle in which to originate fundamentally sound first lien credits in a tightening spread environment. Our Lower Middle Market business saw quality deal flow slow significantly early in the quarter with a pick up late in the quarter. Subsequent to quarter end, we were able to make a $13 million lower middle market first lien loan in Amware Fulfillment and a $10 million last out unitranche club deal that we should be in a position to announce shortly. Additionally, we are pleased with the performance of the portfolio having seen net appreciation of $2.3 million during the quarter. The appreciation was granular throughout the Upper Middle Market and Lower Middle Market portfolios and based on both fundamental and technical improvements.”
Portfolio and Investment Activities
During the quarter ended June 30, 2016, the Company grew the I-45 SLF investment portfolio to $134.5 million from $99.2 million. The Company closed one on-balance sheet credit investment totaling $1.7 million. The Company received proceeds related to the prepayments of certain debt securities totaling $11.1 million and recognized net realized gains on such prepayments totaling $0.2 million. New investment transactions which occurred during the quarter ended June 30, 2016 are summarized as follows:
InfoGroup Inc., $1.7 million 1st Lien Senior Secured Debt: InfoGroup helps companies increase sales and customer loyalty through its high value data and innovative multi-channel digital and offline marketing solutions.
Subsequent to quarter end, the Company originated two new investments totaling $23.4 million, which are summarized as follows:
Amware Fulfillment, LLC, $13.4 million 1st Lien Senior Secured Debt: Amware provides logistics fulfillment services for business-to-consumer, business-to-business, and multi-channel verticals.
Undisclosed Club Deal, $10.0 million 1st Lien Senior Secured Debt (Last Out Unitranche)
Subsequent to quarter end, the Company also made follow-on investments in two existing credit investments totaling $3.1 million, which are summarized as follows:
Imagine! Print Solutions, Inc., $0.9 million 1st Lien Senior Secured Debt: Imagine! is the leading provider of in-store marketing solutions in North America.
InfoGroup Inc., $2.2 million 1st Lien Senior Secured Debt
First Fiscal Quarter 2017 Operating Results
For the quarter ended June 30, 2016, Capital Southwest reported total investment income of $4.2 million, compared to $3.8 million in the prior quarter. The increase in investment income was attributable to both an increase in average debt investments outstanding and dividends paid from certain portfolio companies.
For the quarter ended June 30, 2016, total expenses (excluding tax expense) were $3.2 million, compared to $3.1 million in the prior quarter. The increase in expenses was primarily due to an increase in legal and accounting fees incurred in connection with the 2016 audit.
For the quarter ended June 30, 2016, total pre-tax net investment income was $0.9 million compared to $0.7 million in the prior quarter.
For the quarter ended June 30, 2016, there was a tax expense of $0.5 million recorded compared to a benefit of $0.8 million in the prior quarter. The change was due mainly to an increase in the valuation allowance against our deferred tax asset at Capital Southwest Management Company (CSMC), a wholly-owned management company subsidiary.
During the quarter ended June 30, 2016, Capital Southwest recorded realized and unrealized gains on investments of $2.8 million. The net increase in net assets resulting from operations was $2.7 million, compared to $2.5 million in the prior quarter.
The company’s net asset value, or NAV, at June 30, 2016 was $17.39 per share, as compared to $17.34 at March 31, 2016. The increase in NAV was primarily due to an increase in net realized and unrealized gains in the current quarter offset by a one-time operational charge related to the Spin-Off Compensation Plan.
Liquidity and Capital Resources
At June 30, 2016, Capital Southwest had unrestricted cash and money market balances of approximately $97.0 million, total assets of approximately $280.9 million, and net assets of approximately $273.3 million. As of June 30, 2016, Capital Southwest had no borrowings outstanding.
During the quarter, I-45 SLF increased the total commitments outstanding on its credit facility to $100 million from $75 million. Subsequent to quarter end, I-45 SLF increased the total commitments outstanding on its credit facility to $120 million from $100 million. I-45 SLF had $73 million in borrowings outstanding as of June 30, 2016.
Share Repurchase Program
On January 25th, 2016, Capital Southwest announced that its Board of Directors authorized the repurchase of up to $10 million of its common stock at prices below the Company’s net asset value per share as reported in its most recent financial statements. The Board authorized the plan because it believes that the Company’s common stock may be undervalued from time to time due to market volatility. As of June 30, 2016, no shares have been purchased under the plan.
First Fiscal Quarter 2017 Financial Results Conference Call and Webcast
Capital Southwest has scheduled a conference call on Tuesday, August 9, 2016, at 11:00 a.m. Eastern Time to discuss the first fiscal quarter 2017 financial results. You may access the call by dialing 1-855-835-4076 and using the passcode 52956949 at least 10 minutes before the call. The call can also be accessed using the Investor Relations section of Capital Southwest's website at www.capitalsouthwest.com, or by using http://edge.media-server.com/m/p/xqoyfqyk.
A telephonic replay will be available through August 16, 2016 by dialing 1-855-859-2059 and using the passcode 52956949. An audio archive of the conference call will also be available on the Investor Relations section of Capital Southwest’s website.
For a more detailed discussion of the financial and other information included in this press release, please refer to the Capital Southwest Form 10-Q for the period ended June 30, 2016 to be filed with the Securities and Exchange Commission and Capital Southwest’s First Fiscal Quarter 2017 Earnings Presentation to be posted on the Investor Relations section of Capital Southwest’s website at www.capitalsouthwest.com.
About Capital Southwest
Capital Southwest Corporation (Nasdaq: CSWC) is a Dallas, Texas-based publicly traded business development company, with approximately $273.3 million in net assets as of June 30, 2016. On September 30, 2015, Capital Southwest completed the spin-off to shareholders of its industrial businesses, CSW Industrials, Inc. Capital Southwest is a credit investment firm focused on supporting the acquisition and growth of middle market businesses with $5 to $20 million investments across the capital structure, including first lien, unitranche, second lien and subordinated debt, as well as non-control equity co-investments. Since Capital Southwest's formation in 1961, it has always sought to invest in companies with strong management teams and sound financial performance. As a public company with a permanent capital base, Capital Southwest is fortunate to have the flexibility to be creative in its financing solutions and to invest to support the growth of its portfolio companies over long periods of time.
Forward-Looking Statements
This press release contains historical information and forward-looking statements within the meaning of The Private Securities Litigation Reform Act of 1995 with respect to the business and investments of Capital Southwest. Forward-looking statements are statements that are not historical statements and can often be identified by words such as “will,” “believe,” “expect” and similar expressions, and variations or negatives of these words. These statements are based on management's current expectations, assumptions and beliefs. They are not guarantees of future results and are subject to numerous risks, uncertainties and assumptions that could cause actual results to differ materially from those expressed in any forward-looking statement. These risks include risks related to changes in the markets in which Capital Southwest invests, changes in the financial and lending markets and general economic and business conditions.
Readers should not place undue reliance on any forward-looking statements and are encouraged to review Capital Southwest's Annual Report on Form 10-K for the year ended March 31, 2016 and subsequent fillings with the Securities and Exchange Commission for a more complete discussion of the risks and other factors that could affect any forward-looking statements. Except as required by the federal securities laws, Capital Southwest does not undertake any obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events, changing circumstances or any other reason after the date of this press release.
Investor Relations Contacts:
Michael S. Sarner, Chief Financial Officer
214-884-3829
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Capital Southwest Corporation Q1 2017 Earnings Presentation August 9, 2016 5400 Lyndon B. Johnson Freeway, Suite 1300 | Dallas, Texas 75240 | 214.238.5700 | capitalsouthwest.com |
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Forward-Looking Statements • This presentation contains forward-looking statements within the meaning of The Private Securities Litigation Reform Act of 1995 relating to, among other things the business, financial condition and results of operations of Capital Southwest, the anticipated investment strategies and investments of Capital Southwest, and future market demand. Any statements preceded or followed by or that include the words "believe," "expect," "intend," "plan," "should" or similar words, phrases or expressions or the negative thereof, or any other statements that are not historical statements are forward-looking statements. These statements are made on the basis of the current beliefs, expectations and assumptions of the management of Capital Southwest. There are a number of risks and uncertainties that could cause Capital Southwest’s actual results to differ materially from the forward-looking statements included in this presentation. • In light of these risks, uncertainties, assumptions, and other factors inherent in forward-looking statements, actual results may differ materially from those discussed in this presentation. Other unknown or unpredictable factors could also have a material adverse effect on Capital Southwest’s actual future results, performance, or achievements. For a further discussion of these and other risks and uncertainties applicable to Capital Southwest and its business, see Capital Southwest’s Annual Report on Form 10-K for the fiscal year ended March 31, 2016 and its subsequent filings with the Securities and Exchange Commission. As a result of the foregoing, readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of this presentation. Capital Southwest does not assume any obligation revise or to update these forward-looking statements to reflect any new information, subsequent events or circumstances, or otherwise, except as may be required by law. Page 2 |
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Conference Call Participants Bowen S. Diehl President and Chief Executive Officer Michael S. Sarner Chief Financial Officer Chris Rehberger VP Finance / Treasurer Page 3 |
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CSWC Company Overview CSWC has refocused its investment strategy to become a lender to middle-market companies across the capital structure • • • • CSWC was formed in 1961, and became a BDC in 1988 Publicly-traded on Nasdaq under CSWC ticker Internally-managed BDC with RIC status for tax purposes In December 2014, announced split into two separate companies with spin-off of industrial growth company (“CSW Industrials”; Nasdaq: CSWI) which was completed September 30th, 2015 15 employees based in Dallas, Texas Investable capital base of approximately $273 MM CSWC has made significant strides towards rotating its investment portfolio from equity to credit • • • Page 4 |
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CSWC Corporate Strategy • Building a BDC that pays shareholders attractive and sustainable dividends by establishing: • • • • • A portfolio of investments balanced between liquid and illiquid asset classes A portfolio of predominantly cash generating loans An investment discipline focused on granularity and diversity across asset classes Consistent NAV per share growth through selective equity co-investments A match of fixed and floating rates with financing sources • Maintaining a shareholder friendly Internally Managed structure which: • • • Aligns management incentives with shareholder value Incurs lower operating expenses versus the Externally Managed Structure Historically has rewarded performing Internally Managed BDCs with price to book premiums of 0.5x versus Externally Managed peers • Continuing to execute on our I-45 SLF joint venture with Main Street which: • • • Enhances CSWC origination capabilities in the middle market Grows recurring cash income by investing in a pool of granular and diversified larger middle market first lien loans Cultivates relationships with financial institutions within the Senior Loan Fund credit facility • Pursuing an SBIC License and participation in the Debenture Program to capitalize our smaller lower middle market investment strategy Page 5 |
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Two Pronged Investment Strategy Lower Middle Market: CSWC led or club deals • • • • • • Companies with EBITDA greater than $3 MM Typically leverage of 2x – 4x Debt to EBITDA through CSWC debt Commitment size up to $20 million with hold sizes of $5 MM to $15 MM Originate both Sponsored and Non-sponsored debt investments Securities include first lien, unitranche, second lien and subordinated debt Non-control equity co-investments alongside debt investments Upper Middle Market: Participate/Purchase First and Second Lien positions • • • • • • Companies typically have in excess of $50 MM in EBITDA Typically leverage of 3x – 5.5x Debt to EBITDA through CSWC debt position Hold sizes of $5 MM to $7 MM Floating Rate First and Second Lien debt securities More liquid assets relative to Lower Middle Market investments Provides flexibility to invest/divest opportunistically based on market conditions and liquidity position Page 6 |
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I-45 Senior Loan Fund Portfolio Invested $4 MM additional equity to fund I-45 loan portfolio growth to $134 MM Current I-45 Portfolio (By Industry) Current I-45 Portfolio (By Type) 2%1% 3% 3% 13% 4% 4% 4% 4% 1st Lien 98% 12% 4% 4% 11% 7% 7% 10% 9% 2nd Lien 2% Page 7 I-45 Portfolio Statistics Q3 2016Q4 2016Q1 2017 Total Debt Investments at Cost$82,508$99,836$134,222 Number of Issuers192431 Avg. Investment Size as a % of Portfolio5.26%4.17%3.23% Wtd. Avg. CSWC Leverage on Investments3.3x 3.3x3.7x Wtd. Avg. Yield to Maturity7.59%7.85%8.36% Wtd. Avg. Duration (Yrs) 4.5 4.2 4.2 |
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Q1 2017 Portfolio Originations In Thousands Page 8 Portfolio Originations - Since Quarter End Name Industry Type Market Par Value Yield I nfogroup Software & I T Services 1st Lien Upper Middle Market $2,204 L + 5.5% (1.5% Floor) I magine! Print Solutions Media, Marketing, & Entertainment 1st Lien Upper Middle Market $900 L + 6.0% (1.0% Floor) Amware Fulfillment, LLC Transportation & Logistics 1st Lien Lower Middle Market $13,400 L + 9.5% (1.0% Floor) Middle Market Club Undisclosed 1st Lien Upper Middle Market $10,000 L + 9.0% (1.0% Floor) Total $26,504 Q1 2017 Portfolio Originations Name Industry Type Market Segment Par Value Yield I nfogroup Software & I T Services 1st Lien Upper Middle Market $1,734 L + 5.5% (1.5% Floor) Total $1,734 |
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Portfolio Rotation Focused on Credit • Since June 2014, CSWC has transformed its investment portfolio increasing income earning assets from 1% of the investable portfolio to 58% o Exited 21 legacy portfolio equity investments, generating $222 MM in proceeds o Invested $102 MM in 18 middle-market credit investments o Invested $152 MM in 33 credits within I-45 Senior Loan Fund (“I-45”) 1% of Total Assets Generating Recurring Income 58% of Total Assets Generating Recurring Income Yielding Equity Assets 12% Non-Yielding Equity Assets, 77% Cash 35% I-45 15% Debt Assets 31% Cash, 23% Non-Yielding Equity Assets 7% Debt Assets, 1% Page 9 6/30/2016 Investable Assets 6/30/2014 (excl. CSWI Companies) |
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Portfolio Mix as of 6/30/16 at Fair Value Current Portfolio of $178 MM continues to be granular, diverse, and focused on income generating securities Current Investment Portfolio (By Type) Current Investment Portfolio (By Industry) Healthcare Services 4% Specialty Chemicals 1% Financial Services 2% Consumer Services 3% Software & IT Services 5% Non-Yielding Equity 10% Multi-Sector Holdings (I-45) 23% Distribution 5% 1st Lien 20% Healthcare Products 5% Yielding Equity 19% 2nd Lien 19% Energy Services (Upstream) 6% Industrial Products 22% I-45 Senior Loan Fund 23% Consumer Products & Retail 7% Business Services 8% Senior Subordinated Debt 9% Media, Marketing & Ent. 9% Page 10 |
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Q1 2017 Highlights Financial Highlights • Q1 2017 Pre-Tax Net Investment Income of $918 K or $0.06 per weighted average diluted share Paid quarterly dividend of $0.06 per share No non-accruals within debt investment portfolio Increased I-45 Senior Loan Fund investment portfolio to $134 MM from $99 MM o Increased Deutsche Bank led Credit Facility to $120 MM from $100 MM o I-45 distributed $1.1 MM dividend to CSWC during the quarter $11.1 MM principal repayments during the quarter o Freedom Truck Finance ($6 million proceeds / 14.3% IRR) o Bob’s Discount Furniture ($5 million proceeds / 15.1% IRR) $97 MM in cash available for investment activity • • • • • Page 11 |
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Key Highlights 1 CSWC utilizes an internal 1 - 4 investment rating system in which 1 represents material outperformance and 4 represents material underperformance. All new investments are initially set to 2. 2 Excludes CSWC equity investment in I-45 Senior Loan Fund Page 12 (In Thousands, except per share amounts) Quarter Ended 9/30/2015 Quarter Ended 12/31/2015 Quarter Ended 3/31/2016 Quarter Ended 6/30/2016 Financial Highlights Pre-Tax Net Investment Income / (Loss) Per Wtd. Avg. Diluted Share Dividends Per Share NAV Per Share Cash & Cash Equivalents Debt to Equity Shares Outstanding Weighted Average Shares Outstanding (Diluted) ($0.59) $0.00 $17.68 $184,111 0.0x 15,583 15,680 ($0.04) $0.00 $17.22 $143,680 0.0x 15,725 15,751 $0.04 $0.04 $17.34 $95,969 0.0x 15,726 15,795 $0.06 $0.06 $17.39 $96,957 0.0x 15,718 15,791 Portfolio Statistics Fair Value of Debt Investments Average Debt Investment Hold Size Fair Value of Debt Investments as a % of Cost % of Debt Portfolio on Non-Accrual (at Fair Value) Weighted Average Investment Rating1 Weighted Average Yield on Debt Investments Total Fair Value of Portfolio Investments Weighted Average Yield on all Portfolio Investments Investment Mix (Debt vs. Equity)2 Investment Mix (Yielding vs. Non-Yielding) $45,115 $5,013 100% 0.3% N/A 10.11% $93,339 4.37% 47% / 53% 80% / 20% $60,929 $5,077 100% 0.0% 2.0 10.31% $134,935 10.82% 57% / 43% 89% / 11% $92,832 $5,157 99% 0.0% 2.0 10.67% $178,436 9.46% 65% / 35% 90% / 10% $83,730 $4,925 99% 0.0% 1.9 10.08% $175,915 9.35% 62% / 38% 90% / 10% |
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Balance Sheet Highlights Page 13 (In Thousands, except per share amounts) Quarter Ended 9/30/2015 Quarter Ended 12/31/2015 Quarter Ended 3/31/2016 Quarter Ended 6/30/2016 Assets Portfolio Investments Cash & Cash Equivalents Deferred Tax Asset Other Assets $93,339 $184,111 $1,649 $6,551 $134,935 $143,680 $1,544 $6,421 $178,436 $95,969 $2,342 $7,746 $175,915 $96,957 $1,874 $6,110 Total Assets $285,650 $286,580 $284,493 $280,856 Liabilities Payable for Unsettled Transaction Income Tax Payable Other Liabilities $0 $0 $10,059 $4,850 $2,948 $7,997 $3,940 $0 $7,918 $0 $601 $6,971 Total Liabilities $10,059 $15,795 $11,858 $7,572 Shareholders Equity Net Asset Value Shares Outstanding at Period End NAV per Share Debt to Equity $275,591 15,583 $17.68 0.0x $270,785 15,725 $17.22 0.0x $272,635 15,726 $17.34 0.0x $273,284 15,718 $17.39 0.0x |
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Income Statement Highlights Page 14 (In Thousands, except per share amounts) Quarter Ended 9/30/15 Quarter Ended 12/31/15 Quarter Ended 3/31/16 Quarter Ended 6/30/16 Investment Income Interest Income Dividend Income Fees and Other Income $945 $0 $133 $1,415 $1,612 $280 $2,110 $1,578 $123 $2,292 $1,769 $96 Total Investment Income $1,078 $3,307 $3,811 $4,157 Expenses Cash Compensation Share Based Compensation General & Administrative Spin-off Related Expenses $3,411 $370 $1,070 $5,474 $1,675 $195 $1,354 $710 $1,403 $257 $1,192 $251 $1,484 $239 $1,344 $172 Total Expenses Pre-Tax Net Investment Income / (Loss) $10,325 ($9,247) $3,934 ($627) $3,103 $708 $3,239 $918 Taxes and Gain / (Loss) Income Tax Benefit (Expense) Net realized gain (loss) on investments Net increase (decrease) in unrealized appreciation of investments ($88) ($3,396) $3,783 $607 ($8,170) $7,060 $788 $12 $1,001 ($547) $199 $2,127 Net increase (decrease) in net assets resulting from operations Weighted Average Shares Outstanding Pre-Tax Net Investment Income Per Weighted Average Share Dividends Per Share ($8,948) 15,680 ($0.59) $0.00 ($1,130) 15,751 ($0.04) $0.00 $2,509 15,795 $0.04 $0.04 $2,697 15,791 $0.06 $0.06 |
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Investment Income Detail Constructing a portfolio of investments with recurring cash yield Page 15 (In Thousands) Quarter Ended 9/30/2015 Quarter Ended 12/31/2015 Quarter Ended 3/31/2016 Quarter Ended 6/30/2016 Investment Income Breakdown Cash Interest Cash Dividends Management Fees Amortization of purchase discounts and fees Other Income (non-recurring) $930 $0 $133 $15 $0 $1,392 $1,612 $275 $23 $5 $2,063 $1,578 $115 $47 $8 $2,216 $1,769 $95 $76 $1 Total Investment Income $1,078 $3,307 $3,811 $4,157 Key Metrics Cash Income as a % of Investment Income % of Total Investment Income that is Recurring 98.6% 100.0% 99.3% 99.8% 98.8% 99.8% 98.2% 100.0% |
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Interest Rate Sensitivity Impact of Base Rate Changes on Net Investment Income Debt Portfolio Composition Fixed Rate Debt 18% Floating Rate Debt 82% Note: Illustrative change in NII is based on a projection of our existing debt investments as of 6/30/16, adjusted only for changes in Base Rates. The results of this analysis include the I-45 Senior Loan Fund, which is comprised of 100% floating rate assets and liabilities. Page 16 IllustrativeIllustrative Change in Base Interest RatesNII Change ($'s)NII Change (Per Share) 50 bps($61,563)($0.00) 100bps$437,577$0.03 150bps$1,001,926$0.06 200bps$1,566,276$0.10 |
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Corporate Information Dallas, TX Capital Southwest Page 17 Securities Listing NASDAQ: CSWC Transfer Agent American Stock Transfer & Trust Company, LLC 800-937-5449 www.amstock.com Corporate Offices & Website 5400 LBJ Freeway 13th Floor Dallas, TX 75240 http://www.capitalsouthwest.com Investor Relations Michael S. Sarner 214-884-3829 msarner@capitalsouthwest.com Corporate Counsel Thompson & Knight / Jones Day Dallas, TX Independent Auditor Grant Thornton Fiscal Year End March 31 Senior Management Bowen S. Diehl President & Chief Executive Officer Michael S. Sarner Chief Financial Officer, Secretary & Treasurer Board of Directors Inside Directors Joseph B. Armes Bowen S. Diehl Independent Directors John H. Wilson William R. Thomas T. Duane Morgan David R. Brooks Jack D. Furst |
