(ORLANDO, Fla.) March 21, 2016 – Corporate Capital Trust (the “Company”), a business development company that provides individuals the opportunity to invest in the debt of privately owned American companies, announced its operating results for the year ended Dec. 31, 2015. Corporate Capital Trust will host its earnings call to discuss these results on March 22, 2016. Details about the earnings call can be found below.
“While 2015 presented some challenges as a result of volatility in credit markets, we were able to grow our portfolio to more than $4.0 billion and provided more than $2.0 billion in new capital to middle-market businesses,” said Steve Shackelford, president and CFO of Corporate Capital Trust. “We continue to capture our fair share of new investment opportunities enabling us to continue to provide a stable distribution to our shareholders.”
Erik Falk, co-head of leveraged credit at KKR and board member at Corporate Capital Trust said, “Market volatility will likely continue for some time. We believe that volatility enables us to invest in transactions that produce more attractive risk-adjusted returns in more credit-friendly structures. While net asset value volatility can be uncomfortable as a shareholder, we believe this period presents a compelling value proposition for shareholders who hold a long-term investment approach.”
2015 Year-End Highlights
- Our total cumulative return on an initial investment of $10,000 made in June 2011, assuming dividend reinvestment, grew by 28.1 percent to $12,812 as of Dec. 31, 2015(1) (for an annualized return of 5.6 percent (2)), when including sales load. Excluding sales load, the initial investment grew by 42.4 percent to $14,236(1) (for an annualized return of 8.1 percent (2)).
- During 2015, there were 20 new originated investments, two fewer than the 22 made in 2014. However the investments made in 2015 represented $1.2 billion, and comprising approximately 56 percent of our total investment activity for the year, compared to approximately $898 million and 47 percent of the total investment activity for the year 2014.
- The Company’s total originated investments at fair value on Dec. 31, 2015 totaled approximately $2.3 billion, compared to $1.4 billion on Dec. 31, 2014.
- The primary sources of cash from financing activities in 2015 and 2014 were equity capital proceeds from the issuance of common stock ($618.5 million and $709.1 million, respectively) and net proceeds from borrowings under our credit facilities and term loan ($651.3 million and $66.7 million, respectively). Additionally, $105.4 million and $80.6 million in distributions were reinvested in 2015 and 2014, respectively.
- For the year ended Dec. 31, 2015, the Company declared and paid distributions of approximately $205 million, or $0.80 per share, to shareholders. This is as compared to $142 million and $0.80 per share in 2014.
- Distributions for the years ended Dec. 31, 2015 and 2014 were fully covered by taxable income available for distribution.
- As of Dec. 31, 2015, the Company’s net asset value was $8.93 per share while the public offering price was $10.00 per share, compared to a net asset value and public offering price of $9.79 and $11.00 per share, respectively, on Dec. 31, 2014.
| Financial and Operational Highlights3
|
($ in millions, except per share data) | |||
| As of Dec. 31, |
|
2015 |
|
2014 |
| Total assets |
$ |
4,045.13 |
$ |
2,971.72 |
| Borrowings – credit facilities and term loan, net of discount |
$ |
1,422.59 |
$ |
772.68 |
| Deemed borrowings (TRS implied leverage classified as senior securities) |
$ |
182.33 |
$ |
172.04 |
| Total net assets |
$ |
2,594.02 |
$ |
2,145.82 |
| Net asset value per share |
$ |
8.93 |
$ |
9.79 |
| Leverage ratio |
|
40% |
|
32% |
|
|
|
|
|
|
| Year Ended Dec. 31, |
|
2015 |
|
2014 |
| Cost of investments purchased |
$ |
2,068.74 |
$ |
1,899.45 |
| Sales, principal payments and other exits |
$ |
842.37 |
$ |
1,058.22 |
| Net investment income |
$ |
176.69 |
$ |
130.13 |
| Net realized gains (losses) |
$ |
50.66 |
$ |
19.00 |
| Net change in unrealized appreciation (depreciation) |
$ |
(265.55) |
$ |
(64.81) |
| Total distributions declared |
$ |
205.04 |
$ |
142.02 |
Investment Portfolio Update4
Corporate Capital Trust’s investment and total return swap (TRS) portfolios consisted of investment interests in 140 companies as of Dec. 31, 2015. The portfolio companies are diversified across multiple industries, with the largest portion invested in capital goods (16.2 percent), software & services (12.0 percent), and consumer durables and apparel (9.2 percent).
The primary investment concentration as of Dec. 31, 2015 was senior debt, which represented 78.3 percent of the portfolio at fair value. As of Dec. 31, 2015, 75.0 percent of the company’s debt investments, based on fair value, featured floating interest rates, primarily based on London Interbank Offered Rate (LIBOR), and 25.0 percent of the debt investments featured fixed interest rates. Approximately 94.2 percent of the Company’s floating interest rate debt investments had base interest rate floors; the weighted average base interest rate floor was 1.0 percent as of Dec. 31, 2015.
Recent Events
On Feb. 2, 2016, the board of directors declared a new price per share of $9.80 based on the share pricing policy. The board also declared distributions for four record dates beginning on Feb. 2, 2016, through and including Feb. 23, 2016, at the rate of $0.015483 per share.
On Feb. 12, 2016, Corporate Capital Trust closed its offering to independent broker-dealer networks. The offering remains open for registered investment advisors, and has discounted fees to that sector to be 90 percent of the current public offering price.
On Feb. 26, 2016, the board of directors declared distributions for five record dates beginning on March 1, 2016, through and including March 29, 2016, at the same weekly rate of $0.015483 per share.
Earnings Call
Corporate Capital Trust will hold its earnings call for the fourth quarter and year ended Dec. 31, 2015, on Tuesday, March 22, 2016, at 11:00 a.m. Eastern Daylight Time. To listen to the earnings call, dial 877-256-3665.
(1) Corporate Capital Trust’s net asset value per share was $9.00 and $8.93 on June 17, 2011, and Dec. 31, 2015, respectively. After considering (i) the overall changes in net asset value per share, (ii) all paid distributions from inception through Dec. 31, 2015, and (iii) the assumed reinvestment of those distributions at 90 percent of the prevailing offering price per share, then the total investment return was 42.4 percent for shareholders who held Corporate Capital Trust shares from June 17, 2011(inception), through Dec. 31, 2015. This cumulative return does not take into account any sales load that was paid by our shareholders. When taking into account the payment of a full sales load of 10 percent, the total investment return for those shareholders becomes 28.1 percent.
(2) Corporate Capital Trust’s net asset value per share was $9.79 and $8.93 on Dec. 31, 2014, and Dec. 31, 2015, respectively. After considering (i) the overall changes in net asset value per share, (ii) paid distributions of approximately $0.80 per share in the year ended Dec. 31, 2015, and (iii) the assumed reinvestment of those distributions at 90 percent of the prevailing offering price per share, then the total investment return was (0.9) percent for shareholders who held Corporate Capital Trust shares over the entire year ended Dec. 31, 2015. This calculation does not take into account any sales load that was paid by our shareholders.
(3) Excludes TRS reference assets, which are assets owned by a counterparty to a total return swap agreement, as discussed in the Company’s financial statements, unless otherwise noted.
(4) Includes TRS reference assets, which are assets owned by a counterparty to a total return swap agreement, as discussed in the Company’s financial statements.
About Corporate Capital Trust
Corporate Capital Trust is a non-traded business development company that offers individuals a unique opportunity to invest in privately owned American companies. The company is externally managed by CNL and KKR and its investment objective is to provide shareholders with current income and, to a lesser extent, long-term capital appreciation. The company intends to meet its investment objective by investing primarily in the debt of privately owned companies, with a focus on originated transactions sourced through the networks of its advisors. For additional information, please visit CorporateCapitalTrust.com.
About CNL Financial Group
CNL Financial Group is a leading private investment management firm providing global real estate and alternative investments. Since inception in 1973, CNL Financial Group and/or its affiliates have formed or acquired companies with more than $33 billion in assets. CNL Financial Group is headquartered in Orlando, Florida. For more information, visit CNL.com.
About KKR
KKR is a leading global investment firm that manages investments across multiple asset classes including private equity, energy, infrastructure, real estate, credit and hedge funds. KKR aims to generate attractive investment returns by following a patient and disciplined investment approach, employing world-class people, and driving growth and value creation at the asset level. KKR invests its own capital alongside its partners’ capital and brings opportunities to others through its capital markets business. References to KKR’s investments may include the activities of its sponsored funds. For additional information about KKR & Co. L.P. (NYSE: KKR), please visit KKR’s website at KKR.com and on Twitter @KKR_Co.
A registration statement relating to the common stock of Corporate Capital Trust, Inc. is filed with the Securities and Exchange Commission. The offering of Corporate Capital Trust’s common stock is being made solely by means of a written prospectus, which is available at http://www.sec.gov or may be obtained by calling (866) 650-0650, that contains additional information about Corporate Capital Trust and should be read carefully by an investor before investing. Investors are advised to consider the investment objective, risks, charges and expenses of Corporate Capital Trust carefully before investing. This press release is not an offer to sell and is not soliciting an offer to buy these securities in any state where such offer or sale is not permitted. Neither the SEC, the Attorney General of the State of New York nor any other regulatory agency has passed on or endorsed the merits of this offering. Any representation to the contrary is a criminal offense.
The information in this press release may include “forward-looking statements.” These statements are based on the beliefs and assumptions of Corporate Capital Trust’s management and on the information currently available to management at the time of such statements. Forward-looking statements generally can be identified by the words “believes,” “expects,” “intends,” “plans,” “estimates” or similar expressions that indicate future events. Important factors that could cause actual results to differ materially from Corporate Capital Trust’s expectations include those disclosed in the current prospectus for the public offering of Corporate Capital Trust’s common stock.
Corporate Capital Trust is advised by CNL Fund Advisors Company (CNL) and KKR Credit Advisors (US) LLC (KKR), affiliates of CNL Financial Group and KKR & Co. L.P., respectively.
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