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StoneCastle Financial Corp. Reports First Quarter 2016 Results

May 5, 2016 at 4:15 PM EDT

StoneCastle Financial Corp. Reports First Quarter 2016 Results

NEW YORK, May 05, 2016 (GLOBE NEWSWIRE) -- StoneCastle Financial Corp. (Nasdaq:BANX) ("StoneCastle Financial" or the "Company"), an investment company registered with the Securities and Exchange Commission ("SEC"), today announced results for the first fiscal quarter ended March 31, 2016. 

First Quarter 2016 Investment Highlights:

  • Invested $20.7 million in 5 investments
  • Received issuer calls and partial repayments of $17.5 million from 14 investments
  • Received sales proceeds of $6.3 million from 5 investments

Investment Activity in the First Quarter 2016 Included:

  • $12.1 million in Citizens Bancshares Company Cumulative Perpetual Preferred Stock, Series A, 9.00%
  • $0.8 million in Citizens Bancshares Company Cumulative Perpetual Preferred Stock, Series B, 9.00%
  • $5.0 million in First Colebrook Bancorp, Inc. Subordinated Term Loan, due April 2026, 7.99%  
  • $2.8 million in TriSummit Bank Cumulative Perpetual Preferred Stock, Series A, 9.00%

A complete listing of investments as of the end of the quarter can be found in the Schedule of Investments on the Company's website at www.StoneCastle-Financial.com.

The estimated annualized yield generated by the invested portfolio as of March 31, 2016 (excluding cash and cash equivalents) was approximately 8.98%.

First Quarter 2016 Financial Results

Total earnings for the first quarter were $2,883,891 or $0.44 per share.  Net investment income was $2,593,111 or $0.40 per share, comprised of $4,315,870 in gross income and $1,722,759 of expenses.  Realized capital gains were $290,780 or $0.04 per share.

Net Assets at quarter end were $137,441,183 and the Company's Net Asset Value was $21.09 per share.  

The Company paid a cash distribution of $0.35 per share for the first quarter.  The distribution was paid on March 29, 2016 to shareholders of record at the close of business on March 21, 2016.  

The Company had drawn $50.5 million on its $70 million credit facility at quarter end, which represents approximately 26.7% of total assets.  According to regulated investment company rules, the Company may borrow only up to 33.3% of its total assets.

Portfolio and Investment Summary 

As of the close of business on March 31, 2016, the Company had total assets of $189,280,186 consisting of total investments of $181,536,543, cash of $3,992,946 and other assets of $3,750,697.  Other assets include interest and dividends receivable of $2,993,712, and prepaid assets of $756,985.

During the quarter, the Company deployed $20.7 million in new investments. The Company purchased $15.7 million of preferred securities, and $5.0 million of term loans.  The Company received issuer calls and partial repayments totaling $17.5 million from 14 investments and sold 5 investments for proceeds of $6.3 million. 

Quarterly Conference Call

StoneCastle Financial will host a webcast and conference call on May 5, 2016 at 5:00 pm Eastern time.

The conference call can be accessed by dialing 1-877-407-9039 for domestic callers or 1-201-689-8470 for international callers. Participants may also access the call via live webcast by visiting StoneCastle Financial's investor relations website at www.stonecastle-financial.com. To listen to a live broadcast, go to the website at least 15 minutes prior to the scheduled start time in order to register, download and install any necessary audio software. A replay will be available shortly after the call and be available through midnight (Eastern Time) on May 19, 2016. The replay can be accessed by dialing 1-877-870-5176 for domestic callers or 1-858-384-5517 for international callers. The passcode for the replay is 13634518. The archive of the webcast will be available on the Company's website for a limited time.

About StoneCastle Financial Corp.

StoneCastle Financial is an SEC registered non-diversified, closed-end management investment company listed on the NASDAQ Global Select Market under the symbol "BANX." StoneCastle Financial intends to make long-term, passive, non-control investments in community banks seeking capital for organic growth, acquisitions, share repurchases and other refinancing activities. Its investment objective is to provide current income and, to a lesser extent, capital appreciation. StoneCastle Financial is managed by StoneCastle Asset Management LLC.

Disclaimer and Risk Factors:

There is no assurance that StoneCastle Financial will achieve its investment objective. StoneCastle Financial is subject to numerous risks, including investment and market risks, management risk, income and interest rate risks, banking industry risks, preferred stock risk, convertible securities risk, debt securities risk, liquidity risk, valuation risk, leverage risk, non-diversification risk, credit and counterparty risks, market at a  discount from net asset value risk and market disruption risk. Shares of closed-end investment companies may trade above (a premium) or below (a discount) their net asset value. Shares of StoneCastle Financial may not be appropriate for all investors. Investors should review and consider carefully StoneCastle Financial's investment objective, risks, charges and expenses. Past performance does not guarantee future results. Learn more at www.stonecastle-financial.com.

The Annual Report, Semi-Annual Report and other regulatory filings of the Company with the SEC are accessible on the SEC's website at www.sec.gov and on the Company's website at www.stonecastle-financial.com, and may discuss these or other factors that affect the Company.


 

 STONECASTLE FINANCIAL CORP.
 Statement of Assets and Liabilities (unaudited)
   
        
    March 31, 2016  December 31, 2015
 Assets     
  Investments in securities, at fair value (cost: $185,785,040 and $184,998,847 respectively) $  181,536,543   $  184,753,872 
  Cash (1)    3,992,946      4,009,133 
  Interest and dividends receivable    2,993,712      2,948,819 
  Prepaid assets    756,985      821,845 
  Total assets    189,280,186       192,533,669  
        
 Liabilities     
  Loan payable    50,500,000      25,000,000 
  Payable for securities purchased    -       23,184,943 
  Dividends payable    70,983      2,278,834 
  Investment advisory fee payable     822,358      849,259 
  Loan interest payable    128,528      34,032 
  Directors fee payable    15,811      13,000 
  Accrued expenses payable    301,323      403,681 
  Total liabilities    51,839,003       51,763,749  
 Net Assets    137,441,183       140,769,920  
        
 Net Assets consist of:     
  Common stock at par ($0.001 per share)    6,515      6,511 
  Paid-in-capital    144,366,375      144,295,099 
  Accumulated net investment loss    (1,966,109)     (2,278,834)
  Accumulated net realized loss on investments    (717,101)     (1,007,881)
  Net unrealized depreciation on investments    (4,248,497)     (244,975)
  Net Assets $   137,441,182    $   140,769,920  
        
 Net Asset Value Per Share:     
 Common Stock Shares Outstanding  6,515,388     6,510,953  
 Net asset value per common share $   21.09    $   21.62  
 Market price per share $   17.31    $   16.30  
 Market price discount to net asset value per share  -17.92%   -24.61%
        
 (1) Includes $3,500,000 of restricted cash held in a segregated account at Texas Capital Bank to cover collateral requirements.
        

 


STONECASTLE FINANCIAL CORP.
Statement of Operations (unaudited)
 
           
        For The Three
Months Ended
March 31, 2016
 For the Three
Months Ended
December 31, 2015
Investment Income        
 Interest       $  2,474,856  $  2,302,180 
 Dividends         1,714,249     1,365,072 
 Origination fee income        54,265     709,527 
 Other Income        72,500     106,000 
 Total Investment Income       4,315,870      4,482,779  
           
Expenses         
 Investment advisory fees        823,576     849,259 
 Interest expense        415,335     345,840 
 ABA marketing and licensing fees       65,966     77,868 
 Professional fees        69,792     75,393 
 Transfer agent, custodian fees and administrator fees     69,320     70,558 
 Bank fees         52,381     70,478 
 Directors' fees        44,560     44,915 
 Valuation fees        20,866     37,970 
 Investor relations fees        29,871     30,430 
 Insurance expense        22,323     22,530 
 Miscellaneous fees (proxy, printing, rating agency, etc.)    108,769     107,800 
 Total expenses        1,722,759      1,733,041  
 Net Investment Income        2,593,111      2,749,738  
           
Realized and Unrealized Gain / (Loss) on Investments     
 Net realized gain / (loss) on investments      290,780     (3,005,896)
 Net change in unrealized depreciation on investments    (4,003,521)    (503,005)
 Net realized and unrealized loss on investments     (3,712,741)    (3,508,901)
 Net Decrease in Net Assets Resulting From Operations  $   (1,119,630) $   (759,163)
           
           

 

  

 STONECASTLE FINANCIAL CORP. 
 Financial Highlights (unaudited) 
   
    
  For The Three
Months Ended
March 31, 2016
 
 Per Share Operating Performance  
 Net Asset Value, beginning of period $   21.62   
 Net investment income(1)   0.40  
 Net realized and unrealized gain on investments(1)   (0.58) 
 Total from investment operations   (0.18) 
    
 Less distributions to shareholders  
 From net investment income   (0.35) 
 Total distributions    (0.35) 
    
 Net asset value, end of period$   21.09   
    
 Per share market value, end of period$  17.31  
 Total investment return based on market value (2) 8.38% 
    
 Ratios and Supplemental Data  
 Net assets, end of period (in millions)$   137.4   
 Ratios (as a percentage to average net assets):  
 Expenses (3)(4)* 4.98% 
 Net investment income(5)* 7.50% 
 Portfolio turnover rate ** 11% 
    
 Revolving Credit Agreement  
 Total revolving credit agreement outstanding (000's)$  50,500  
 Asset coverage per $1,000 for revolving credit agreement(6)   3,722  
    
 (1)Based on the average shares outstanding during quarter.  
 (2)Based on share market price and reinvestment of distributions at the price obtained under the Dividend  
 Reinvestment Plan. Total return does not include sales load and offering expenses.  
 (3)Excluding interest expense, the ratio would have been 3.78%.  
 (4)Ratio of expenses to average managed assets equals 3.63%.  
 (5)Ratio of net investment income to average managed assets equals 5.46%.  
 (6)Calculated by subtracting the Company's total liabilities (excluding the loan) from the Company's total assets  
 and dividing the amount by the loan outstanding.  
* Annualized  
**Not-annualized  
    

 


 

CONTACT: 
Investor Contact:
Julie Muraco
347-887-0324