Ares Capital Corporation Announces March 31, 2025 Financial Results and Declares Second Quarter 2025 Dividend of $0.48 Per Share
DIVIDEND DECLARATIONS
NEW YORK--(BUSINESS WIRE)--April 29, 2025--
Ares Capital Corporation ("Ares Capital") $(ARCC)$ announced that its Board of Directors has declared a second quarter 2025 dividend of $0.48 per share. The second quarter 2025 dividend is payable on June 30, 2025 to stockholders of record as of June 13, 2025.
MARCH 31, 2025 FINANCIAL RESULTS
Ares Capital also announced financial results for its first quarter ended March 31, 2025.
OPERATING RESULTS
Q1-25(3) Q1-24(3)
-------------------- -----------------------
(dollar amounts
in millions,
except per share Total Total
data) Amount Per Share Amount Per Share
---------------- -------- ---------- --------- ------------
GAAP net income
per share(1) $ 0.36 $ 0.76
Core EPS(2) $ 0.50 $ 0.59
Dividends
declared and
payable $ 0.48 $ 0.48
Net investment
income(1) $ 365 $ 0.54 $ 325 $ 0.55
Net realized
losses(1) $ (61) $ (0.09) $ (32) $ (0.05)
Net unrealized
(losses)
gains(1) $ (63) $ (0.09) $ 156 $ 0.26
GAAP net
income(1) $ 241 $ 0.36 $ 449 $ 0.76
As of
-------------------------------------
(dollar amounts in millions,
except per share data) March 31, 2025 December 31, 2024
---------------------------------- ---------------- -------------------
Portfolio investments at fair value $ 27,130 $ 26,720
Total assets $ 28,317 $ 28,254
Stockholders' equity $ 13,672 $ 13,355
Net assets per share $ 19.82 $ 19.89
Debt/equity ratio 1.02x 1.03x
Debt/equity ratio, net of available 0.98x 0.99x
cash(4)
____________________________________________
(1) All per share amounts and weighted average shares outstanding are basic
and diluted. The basic and diluted weighted average shares outstanding
for the three months ended March 31, 2025 and 2024 were approximately
676 million and 591 million, respectively.
(2) Core EPS is a non-GAAP financial measure. Core EPS is the net increase
(decrease) in stockholders' equity resulting from operations, and
excludes net realized and unrealized gains and losses, any capital
gains incentive fee attributable to such net realized and unrealized
gains and losses and any income taxes related to such net realized
gains and losses, divided by the basic weighted average shares
outstanding for the relevant period. GAAP net income (loss) per share
is the most directly comparable GAAP financial measure. Ares Capital
believes that Core EPS provides useful information to investors
regarding financial performance because it is one method Ares Capital
uses to measure its financial condition and results of operations. The
presentation of this additional information is not meant to be
considered in isolation or as a substitute for financial results
prepared in accordance with GAAP. Reconciliations of GAAP net income,
the most directly comparable GAAP financial measure, to Core EPS are
set forth in Schedule 1 hereto.
(3) Net income can vary substantially from period to period due to various
factors, including the level of new investment commitments, the
recognition of realized gains and losses and unrealized appreciation
and depreciation. As a result, quarterly comparisons of net income may
not be meaningful.
(4) Computed as total principal debt outstanding less available cash
divided by stockholders' equity. Available cash excludes restricted
cash as well as cash held for uses specifically designated for paying
interest and expenses on certain debt.
"As announced last quarter, after more than a decade as ARCC's CEO, I will transition leadership to Kort Schnabel, effective April 30," said Kipp deVeer, Chief Executive Officer of Ares Capital. "As I step into my new role at Ares Management, I look forward to continuing to serve as a Director of ARCC and believe that ARCC's leadership team will continue delivering strong results for our stockholders."
"We are starting the year with solid first quarter results, underpinned by a healthy portfolio, stable credit quality, and significant financial flexibility," said Kort Schnabel, Co-President of Ares Capital. "With our scale, experience and disciplined approach, we believe we are well positioned to further build on our 20-year track record of delivering stockholder value during periods of uncertainty."
"Since the beginning of this year, we have actively enhanced our capital and liquidity position by first accessing the unsecured notes market and then extending maturities, increasing capacity and reducing pricing on two of our secured revolving facilities," said Scott Lem, Chief Financial Officer of Ares Capital. "With leverage below 1x net debt to equity, and a deep and stable capital base, our balance sheet strength allows us to continue supporting our portfolio companies while also remaining active across the direct lending market."
PORTFOLIO AND INVESTMENT
ACTIVITY
(dollar amounts in millions) Q1-25 Q1-24
------------------------------ ------------------ ---------------------
Portfolio Activity During the
Period:
Gross commitments $ 3,453 $ 3,554
Exits of commitments $ 2,857 $ 3,414
Portfolio Information:
As of
-----------------------------------------
March 31, 2025 December 31, 2024
------------------ ---------------------
Portfolio investments at
fair value $ 27,130 $ 26,720
Fair value of accruing debt
and other income producing
securities(5) $ 23,981 $ 23,643
Number of portfolio company
investments 566 550
Percentage of floating rate
securities at fair
value(6) 69% 69%
Weighted average yields on
debt and other income
producing securities(7):
At amortized cost 11.0% 11.1%
At fair value 11.1% 11.2%
Weighted average yields on
total investments(8):
At amortized cost 9.9% 10.0%
At fair value 9.8% 9.9%
Asset class percentage at fair
value:
First lien senior secured
loans 58% 57%
Second lien senior
secured loans 6% 7%
Subordinated certificates
of the SDLP 4% 5%
Senior subordinated loans 5% 5%
Preferred equity 10% 10%
Ivy Hill Asset
Management, L.P.(9) 7% 7%
Other equity 10% 9%
____________________________________________
(5) Includes the fair value of Ares Capital's equity investment in Ivy Hill
Asset Management, L.P. ("IHAM").
(6) Includes Ares Capital's investment in the subordinated certificates of
the SDLP (as defined below).
(7) Weighted average yields on debt and other income producing securities
are computed as (a) the annual stated interest rate or yield earned
plus the net annual amortization of original issue discount and market
discount or premium earned on accruing debt and other income producing
securities (including the annualized amount of the regular dividend
received by Ares Capital related to its equity investment in IHAM
during the most recent quarter end), divided by (b) the total accruing
debt and other income producing securities at amortized cost or at fair
value (including the amortized cost or fair value of Ares Capital's
equity investment in IHAM as applicable), as applicable.
(8) Weighted average yields on total investments are computed as (a) the
annual stated interest rate or yield earned plus the net annual
amortization of original issue discount and market discount or premium
earned on accruing debt and other income producing securities
(including the annualized amount of the regular dividend received by
Ares Capital related to its equity investment in IHAM during the most
recent quarter end), divided by (b) total investments at amortized cost
or at fair value, as applicable.
(9) Includes Ares Capital's subordinated loan and equity investments in
IHAM, as applicable.
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