10-year

10-Year Anniversary Promotion (20% off)

Join GuruFocus Premium Membership Now for Only $279/Year

Once a decade discount

Save up to $500 on Global Membership.

Don't Miss It !

Free 7-day Trial
All Articles and Columns »

Ares Capital Corp. Reports Operating Results (10-Q)

May 10, 2010 | About:
10qk

10qk

18 followers
Ares Capital Corp. (ARCC) filed Quarterly Report for the period ended 2010-03-31.

Ares Capital Corp. has a market cap of $1.84 billion; its shares were traded at around $13.87 with a P/E ratio of 10.43 and P/S ratio of 7.52. The dividend yield of Ares Capital Corp. stocks is 10.09%. Ares Capital Corp. had an annual average earning growth of 11.4% over the past 5 years.ARCC is in the portfolios of John Griffin of Blue Ridge Capital, Steven Romick of FPA Crescent Fund, First Pacific Advisors of First Pacific Advisors, LLC, Jim Simons of Renaissance Technologies LLC, Steven Cohen of SAC Capital Advisors.

Highlight of Business Operations:

For the three months ended March 31, 2010, total investment income increased $10.5 million, or 19%, to $66.5 million from $56.0 million for the comparable period in 2009. For the three months ended March 31, 2010, total investment income consisted of $61.5 million in interest income from investments, $2.1 million in capital structuring service fees, $1.5 million in management fees, $0.5 million in dividend income and $0.9 million in other income. Interest income from investments increased $9.2 million, or 18%, to $61.5 million for the three months ended March 31, 2010 from $52.3 million for the comparable period in 2009. The increase in interest income from investments was primarily due to the increase in investments, as the average investments at fair value increased from $2.0 billion for the three months ended March 31, 2009 to $2.2 billion for the three months ended March 31, 2010. Capital structuring service fees increased $0.9 million, or 75%, to $2.1 million for the three months ended March 31, 2010 from $1.2 million for the comparable period in 2009. The increase in capital structuring service fees was primarily due to the increase in new investment commitments for the three months ended March 31, 2010 as compared to the three months ended March 31, 2009. Management fees increased $0.8 million, or 108%, to $1.5 million for the three months ended March 31, 2010 from $0.7 million for the comparable period in 2009. The increase in management fees was primarily related to management fees earned in respect of Senior Secured Loan Fund LLC (the Senior Secured Loan Fund).

For the three months ended March 31, 2010, total expenses increased $9.2 million, or 36%, to $35.0 million from $25.8 million for the comparable period in 2009. Interest expense and credit facility fees increased $2.0 million, or 31%, to $8.6 million for the three months ended March 31, 2010 from $6.6 million for the comparable period in 2009, primarily due to higher amortization of debt costs and the higher weighted average stated interest rate on our debt. For the three months ended March 31, 2010, the Company also incurred $3.8 million in professional fees related to the Allied Acquisition that were not incurred in the comparable period in 2009.

Certain of our wholly owned subsidiaries are subject to U.S. Federal and state income taxes. For the three months ended March 31, 2010, we recorded a tax benefit of $0.1 million for these subsidiaries, and for the three months ended March 31, 2009, we recorded a provision of approximately $0.1 million for these subsidiaries.

For the three months ended March 31, 2010, the Company had net unrealized gains of $49.6 million, which was primarily comprised of $16.5 million in unrealized depreciation, $57.5 million in unrealized appreciation and $8.6 million related to the reversal of prior period net unrealized depreciation. The most significant changes in net unrealized appreciation and depreciation (excluding the reversal of prior period net unrealized depreciation) during the three months ended March 31, 2010 were as follows (in millions):

Read the The complete Report

About the author:

10qk
GuruFocus - Stock Picks and Market Insight of Gurus

Rating: 4.5/5 (4 votes)

Comments

Please leave your comment:


Get WordPress Plugins for easy affiliate links on Stock Tickers and Guru Names | Earn affiliate commissions by embedding GuruFocus Charts
GuruFocus Affiliate Program: Earn up to $400 per referral. ( Learn More)
Free 7-day Trial
FEEDBACK