Prospect Capital Announces December 2023 Financial Results and Declares 80th Consecutive $0.06 Dividend

NEW YORK, Feb. 08, 2024 (GLOBE NEWSWIRE) — Prospect Capital Corporation (NASDAQ:PSEC) (“Prospect”, “our”, or “we”) today announced financial results for our fiscal quarter ended December 31, 2023.

FINANCIAL RESULTS

All amounts in $000’s except
per share amounts (on weighted average
basis for period numbers)
 
Quarter Ended
 
Quarter Ended
 
Quarter Ended
 

 
December 31, 2023
 
September 30, 2023
 
December 31, 2022
 

 
 
 
 
 
 
 
 

Net Investment Income (“NII”)
 
$96,927
 
$125,612
 
$106,704
 

NII per Common Share
 
$0.24
 
$0.31
 
$0.27
 

Interest as % of Total Investment Income
 
92.3%
 
85.7%
 
89.6%
 

 
 
 
 
 
 
 
 

Net Income (Loss) Applicable to Common Shareholders
 
$(51,436)
 
$94,011
 
$55,623
 

Net Income (Loss) per Common Share
 
$(0.13)
 
$0.23
 
$0.14
 

 
 
 
 
 
 
 
 

Distributions to Common Shareholders
 
$74,056
 
$73,252
 
$71,670
 

Distributions per Common Share
 
$0.18
 
$0.18
 
$0.18
 

Cumulative Paid and Declared Distributions to Common Shareholders(1)
 
$4,162,509
 
$4,088,041
 
$3,867,505
 

Cumulative Paid and Declared Distributions per Common Share(1)
 
$20.76
 
$20.58
 
$20.04
 

 
 
 
 
 
 
 
 

Total Assets
 
$7,781,214
 
$7,853,828
 
$7,890,413
 

Total Liabilities
 
$2,596,824
 
$2,602,715
 
$2,716,469
 

Preferred Stock
 
$1,500,741
 
$1,470,247
 
$1,207,553
 

Net Asset Value (“NAV”) to Common Shareholders
 
$3,683,649
 
$3,780,866
 
$3,966,391
 

NAV per Common Share
 
$8.92
 
$9.25
 
$9.94
 

 
 
 
 
 
 
 
 

Balance Sheet Cash + Undrawn Revolving Credit Facility Commitments
 
$1,187,740
 
$1,108,386
 
$1,017,280
 

 
 
 
 
 
 
 
 

Net of Cash Debt to Equity Ratio(2)
 
46.2%
 
46.5%
 
49.4%
 

Net of Cash Asset Coverage of Debt Ratio(2)
 
316%
 
314%
 
301%
 

 
 
 
 
 
 
 
 

Unsecured Debt + Preferred Equity as % of Total Debt + Preferred Equity
 
78.4%
 
77.0%
 
80.3%
 

Unsecured and Non-Recourse Debt as % of Total Debt
 
100.0%
 
100.0%
 
100.0%
 

All amounts in $000’s except
per share amounts
Six Months Ended
Six Months Ended

December 31, 2023
December 31, 2022

 
 
 

NII
$222,539
$205,970
 

NII per Common Share
$0.54
$0.52
 

 
 
 

Net Income (Loss) Applicable to Common Shareholders
$42,575
$(49,576)
 

Net Income (Loss) per Common Share
$0.10
$(0.13)
 

 
 
 

Distributions to Common Shareholders
$147,308
$142,742
 

Distributions per Common Share
$0.36
$0.36
 

(1)   Declared dividends are through the April 2024 distribution. February through April 2024 distributions are estimated based on shares outstanding as of 1/29/2024.
(2)   Including our preferred stock as equity.

CASH COMMON SHAREHOLDER DISTRIBUTION DECLARATION

Prospect is declaring distributions to common shareholders as follows:

Monthly Cash Common Shareholder Distribution
Record Date
Payment Date
Amount ($ per share)

February 2024
2/27/2024
3/20/2024
$0.0600

March 2024
3/27/2024
4/18/2024
$0.0600

April 2024
4/26/2024
5/21/2024
$0.0600

These monthly cash distributions are the 78th, 79th, and 80th consecutive $0.06 per share distributions to common shareholders.

Prospect expects to declare May 2024, June 2024, July 2024, and August 2024 distributions to common shareholders in May 2024.

Based on the declarations above, Prospect’s closing stock price of $5.81 at February 7, 2024 delivers to our common shareholders an annualized distribution yield of 12.4%.

Taking into account past distributions and our current share count for declared distributions, since inception through our April 2024 declared distribution, Prospect will have distributed $20.76 per share to original common shareholders, representing 2.3 times December 2023 common NAV per share, aggregating approximately $4.20 billion in cumulative distributions to all common shareholders.

Since inception in 2004, Prospect has invested $20.6 billion across 420 investments, exiting 287 of these investments.

Drivers focused on growing NII and NAV per share include (1) our $2.25 billion targeted 6.50% and Floating Rate perpetual preferred stock offerings, (2) greater utilization of our cost efficient revolving floating rate credit facility, (3) elevated short-term SOFR rates based on Fed tightening to boost asset yields, (4) optimization of portfolio company performance, and (5) increased primary and secondary originations of senior secured debt and selected equity investments targeting attractive risk-adjusted yields and total returns as we deploy dry powder from our underleveraged balance sheet.

Our senior management team and employees own approximately 27% of all common shares outstanding, approximately $1.0 billion of our common equity as measured at NAV.

PORTFOLIO UPDATE AND INVESTMENT ACTIVITY

All amounts in $000’s except
per unit amounts
As of
As of
As of

December 31, 2023
September 30, 2023
December 31, 2022

 
 
 
 

Total Investments (at fair value)
$7,631,846
 
$7,736,817
 
$7,770,336
 

Number of Portfolio Companies
 
126
 
 
128
 
 
130
 

 
 
 
 

First Lien Debt
 
58.7%
 
 
57.3%
 
 
53.0%
 

Second Lien Debt
 
15.5%
 
 
15.9%
 
 
18.5%
 

Subordinated Structured Notes
 
7.9%
 
 
8.1%
 
 
9.0%
 

Unsecured Debt
 
0.1%
 
 
0.1%
 
 
0.2%
 

Equity Investments
 
17.8%
 
 
18.6%
 
 
19.3%
 

Mix of Investments with Underlying Collateral Security
 
82.1%
 
 
81.3%
 
 
80.5%
 

 
 
 
 

Annualized Current Yield – All Investments
 
10.1%
 
 
10.3%
 
 
10.3%
 

Annualized Current Yield – Performing Interest Bearing Investments
 
12.3%
 
 
12.7%
 
 
12.9%
 

 
 
 
 

Top Industry Concentration(1)
 
17.8%
 
 
18.2%
 
 
17.7%
 

Retail Industry Concentration(1)
 
0.3%
 
 
0.3%
 
 
0.4%
 

Energy Industry Concentration(1)
 
1.4%
 
 
1.6%