Ares Capital Corporation Announces December 31, 2024 Financial Results and Declares First Quarter 2025 Dividend of $0.48 Per Share
DIVIDEND DECLARATIONS
NEW YORK--(BUSINESS WIRE)--February 05, 2025--
Ares Capital Corporation ("Ares Capital") $(ARCC)$ announced that its Board of Directors has declared a first quarter 2025 dividend of $0.48 per share. The first quarter 2025 dividend is payable on March 31, 2025 to stockholders of record as of March 14, 2025.
DECEMBER 31, 2024 FINANCIAL RESULTS
Ares Capital also announced financial results for its fourth quarter and year ended December 31, 2024.
OPERATING RESULTS
Q4-24(4) Q4-23(4) FY-24 FY-23
----------------- --------------- ---------------- ------------------
(dollar amounts
in millions,
except per share Total Per Total Per Total Per Total
data) Amount Share Amount Share Amount Share Amount Per Share
---------------- -------- ------- -------- ----- ------- ------- ------- ---------
GAAP net income
per share(1)(2) $ 0.55 $0.72 $ 2.44 $ 2.75
Core EPS(3) $ 0.55 $0.63 $ 2.33 $ 2.37
Dividends
declared and
payable $ 0.48 $0.48 $ 1.92 $ 1.92
Net investment
income(1) $359 $ 0.55 $ 345 $0.60 $1,403 $ 2.25 $1,266 $ 2.28
Net realized
(losses)
gains(1) $(25) $(0.03) $ 28 $0.05 $ (69) $(0.11) $ (179) $(0.32)
Net unrealized
gains(1) $ 23 $ 0.03 $ 40 $0.07 $ 188 $ 0.30 $ 435 $ 0.79
GAAP net
income(1)(2) $357 $ 0.55 $ 413 $0.72 $1,522 $ 2.44 $1,522 $ 2.75
As of
----------------------------------------
(dollar amounts in millions,
except per share data) December 31, 2024 December 31, 2023
------------------------------- ------------------- -------------------
Portfolio investments at fair
value $ 26,720 $ 22,874
Total assets $ 28,254 $ 23,800
Stockholders' equity $ 13,355 $ 11,201
Net assets per share $ 19.89 $ 19.24
Debt/equity ratio 1.03x 1.07x
Debt/equity ratio, net of 0.99x 1.02x
available cash(5)
____________________________
(1) All per share amounts and weighted average shares outstanding are
basic. The basic weighted average shares outstanding for the three
months and year ended December 31, 2024 were approximately 655 million
and 624 million, respectively, and approximately 572 million and 554
million, respectively, for the comparable periods in 2023.
(2) The basic and diluted weighted average shares outstanding for the three
months and year ended December 31, 2024 was approximately 655 million
and 624 million shares, respectively. Ares Capital's diluted GAAP net
income per share for the three months and year ended December 31, 2023
was $0.70 and $2.68, respectively. The weighted average shares
outstanding for the purpose of calculating the diluted GAAP net income
per share for the three months and year ended December 31, 2023 were
approximately 593 million shares and 575 million shares, respectively,
which includes approximately 21 million shares for each period related
to the assumed conversion of Ares Capital's then outstanding $403
million in aggregate principal amount of unsecured convertible notes
(the "2024 Convertible Notes").
(3) 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.
(4) 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.
(5) 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.
"With our fourth quarter's results, we concluded another successful year for the company where stable credit performance and a record year of investing supported strong earnings and further growth in book value per share," said Kipp deVeer, Chief Executive Officer of Ares Capital. "As we enter 2025, we believe we are well positioned for what we expect will be an increasingly active investing market for acquisition finance and growth capital opportunities."
"Through year-end 2024, we have now paid over 15 consecutive years of stable or growing regular dividends while continuing to increase our book value for shareholders," said Scott Lem, Chief Financial Officer of Ares Capital. "Our ability to deliver this attractive level of long-term performance is supported by the strength of our balance sheet, which we believe is a key point of differentiation for ARCC."
PORTFOLIO AND INVESTMENT ACTIVITY
(dollar amounts in
millions) Q4-24 Q4-23 FY-24 FY-23
--------------------- ------ ------ ----------- -----------
Portfolio Activity
During the Period:
Gross commitments $3,751 $2,384 $15,081 $ 5,966
Exits of
commitments $2,715 $1,427 $10,103 $ 5,729
Portfolio
Information:
As of December 31,
------------------------
2024 2023
----------- -----------
Portfolio
investments at
fair value $26,720 $22,874
Fair value of
accruing debt and
other income
producing
securities(6) $23,643 $20,375
Number of
portfolio company
investments 550 505
Percentage of
floating rate
securities at
fair value(7) 69% 69%
Weighted average
yields on debt
and other income
producing
securities(8):
At amortized
cost 11.1% 12.5%
At fair value 11.2% 12.5%
Weighted average
yields on total
investments(9):
At amortized
cost 10.0% 11.3%
At fair value 9.9% 11.2%
Asset class
percentage at
fair value:
First lien
senior
secured
loans 57% 44%
Second lien
senior
secured
loans 7% 16%
Subordinated
certificates
of the SDLP 5% 6%
Senior
subordinated
loans 5% 5%
Preferred
equity 10% 11%
Ivy Hill Asset
Management,
L.P.(10) 7% 9%
Other equity 9% 9%
____________________________
(6) Includes the fair value of Ares Capital's equity investment in Ivy
Hill Asset Management, L.P. ("IHAM").
(7) Includes Ares Capital's investment in the subordinated certificates of
the SDLP (as defined below).
(8) 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.
(9) Weighted average yields on total investments are computed as (a) the
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