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StoneCastle Financial Corp. Reports Fourth Quarter 2017 Results

March 1, 2018 at 4:10 PM EST

StoneCastle Financial Corp. Reports Fourth Quarter 2017 Results

NEW YORK, March 01, 2018 (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 fourth fiscal quarter ended December 31, 2017.  

Fourth Quarter 2017 Investment Highlights:

  • Invested $13.2 million in three investments

  • Received full and partial calls of $23.4 million from three investments

Investment Activity in the Fourth Quarter 2017 Included:

  • Invested $8.0 million in Fidelity Federal Bancorp, Subordinated Term Loan, 8.25%, 1/1/2028

  • Invested $3.8 million in First Western Financial, Inc., Fixed Rate Cumulative Perpetual Preferred Stock, Series A, 9.00%

  • Invested $1.4 million in Preferred Term Securities, Ltd., Fixed Rate Mezzanine Notes, 9.74%, 9/15/2030, 144A

Subsequent to quarter end, StoneCastle made five investments totaling $36.1 million.  Included in that amount, the Company invested $17.6 million in a preferred equity interest of a new pooled vehicle whereby the Company contributed $43.4 million of securities.

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

The estimated annualized yield generated by the invested portfolio as of December 31, 2017 (excluding cash and cash equivalents) was approximately 9.05%.  This quarter is the fifth consecutive quarter of an estimated annualized yield over 9.00%.

Fourth Quarter 2017 Financial Results

Total earnings for the fourth quarter were $3,037,309 or $0.47 per share.  Net investment income was $2,662,211 or $0.41 per share, comprised of $4,237,473 in gross income and $1,575,262 of expenses.  For the quarter, net realized capital gains were $375,098 or $0.06 per share. 

Net Assets at quarter end were $141,049,498, flat from the prior quarter.  The Company's Net Asset Value was $21.56 per share, unchanged from the prior quarter.

In the fourth quarter, the Company paid a cash distribution of $0.38 per share.  The distribution was paid on January 3, 2018 to shareholders of record at the close of business on December 22, 2017.

The Company had $25.75 million outstanding on its $62.0 million credit facility at the quarter end, which represents approximately 15.1% 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 December 31, 2017, the Company had total assets of $170,430,356 consisting of total investments of $166,911,546, cash of $30,142 and other assets of $3,488,668.  Other assets include interest and dividends receivable of $2,435,308 and prepaid assets of $1,053,360.

During the quarter, the Company received two full calls and one partial call for a total of $23,421,467.

Quarterly Conference Call

StoneCastle Financial will host a webcast and conference call on March 1, 2018 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 March 15, 2018. The replay can be accessed by dialing 1-844-512-2921 for domestic callers or 1-412-317-6671 for international callers. The passcode for the replay is 13674902. 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.

CONTACT: Investor Contact:

         Julie Muraco

         347-887-0324

 STONECASTLE FINANCIAL CORP.
 Statement of Assets and Liabilities
   
        
    December 31, 2017  September 30, 2017
 Assets     
  Investments in securities, at fair value (cost:
$169,571,744 and $176,825,546 respectively)
 $  166,911,546   $  174,745,784 
  Cash     30,142      248,128 
  Interest and dividends receivable    2,435,308      2,600,690 
  Prepaid assets    1,053,360      1,109,113 
  Total assets    170,430,356       178,703,715  
        
 Liabilities     
  Loan payable    25,750,000      36,500,000 
  Dividend payable    2,486,070    - 
  Investment advisory fee payable     751,761      788,255 
  Loan interest payable    51,901      1,149 
  Directors fee payable    13,326      12,908 
  Accrued expenses payable    327,800      322,707 
  Total liabilities    29,380,858       37,625,019  
 Net Assets $   141,049,498    $   141,078,696  
        
 Net Assets consist of:     
  Common stock at par ($0.001 per share) $  6,542   $  6,542 
  Paid-in-capital    144,858,951      144,858,951 
  Accumulated net investment loss    (1,078,833)     (1,252,819)
  Accumulated net realized loss on investments    (76,964)     (454,216)
  Net unrealized depreciation on investments    (2,660,198)     (2,079,762)
  Net Assets $   141,049,498    $   141,078,696  
        
        
 Net Asset Value Per Share:     
 Common Stock Shares Outstanding  6,542,289     6,542,289  
 Net asset value per common share $   21.56    $   21.56  
 Market price per share $   20.13    $   20.64  
 Market price discount to net asset value per share  -6.63%   -4.27%
        
        
        
        

 

STONECASTLE FINANCIAL CORP.
Statement of Operations 
    
          For The Three
Months Ended
December 31,
  2017
 For The Three
Months Ended
September 30,
  2017
 Investment Income         
  Interest        $  3,359,404  $  3,329,471 
  Dividends          673,888     960,763 
  Origination fee income         141,681     7,094 
  Other Income         62,500     62,500 
  Total Investment Income        4,237,473      4,359,828  
             
 Expenses          
  Investment advisory fees        751,761     788,255 
  Interest expense         323,511     428,246 
  Professional fees         175,417     141,981 
  Bank fees          55,083     69,742 
  Directors' fees         51,794     51,793 
  Transfer agent, custodian fees and administrator fees      50,008     68,357 
  ABA marketing and licensing fees        38,157     55,096 
  Investor relations fees         27,945     32,946 
  Delaware franchise tax         22,685     22,684 
  Valuation fees         17,337     12,338 
  Insurance expense         4,420     22,019 
  Printing          3,195     18,195 
  Miscellaneous fees          53,949     46,341 
  Total expenses         1,575,262      1,757,993  
  Net Investment Income      $   2,662,211   $   2,601,835  
             
 Realized and Unrealized Gain / (Loss) on Investments       
  Net realized gain / (loss) on investments    $  375,098  $  (147,236)
  Net change in unrealized  depreciation  on investments      (580,436)    630,018 
  Net realized and unrealized gain / (loss) on investments      (205,338)    482,782 
  Net Increase in Net Assets Resulting From Operations   $   2,456,873   $   3,084,617  
             

 

 STONECASTLE FINANCIAL CORP.
 Financial Highlights
      
      
     For The Three Months
Ended December 31,
2017
 Per Share Operating Performance    
 Net Asset Value, beginning of period    $   21.56  
 Net investment income(1)      0.41 
 Net realized and unrealized gain / (loss) on investments(1)      (0.03)
 Total from investment operations      0.38  
      
 Less distributions to shareholders    
 From net investment income      (0.38)
 Total distributions       (0.38)
      
 Net asset value, end of period   $   21.56  
 Per share market value, end of period   $   20.13  
      
 Total Investment Return (2)    
 Based on market value     -0.60%
 Based on net asset value    1.92%
      
 Ratios and Supplemental Data    
 Net assets, end of period (in millions)   $   141.0  
 Ratios (as a percentage to average net assets):    
   Expenses before waivers(3)(4)*    4.43%
   Expenses after waivers(5)*    4.43%
   Net investment income(6)*    7.49%
 Portfolio turnover rate **    8%
      
 Revolving Credit Agreement    
 Total revolving credit agreement outstanding (000's)   $  25,750 
 Asset coverage per $1,000 for revolving credit agreement(7)      6,478 
      
(1)Based on the average shares outstanding during quarter.    
(2)Reflects reinvestment of distributions at the price obtained under the Dividend Reinvestment Plan.
 Total return does not include sales load and offering expenses and are not annualized.
(3)Excluding interest expense, the ratio would have been 3.52%.    
(4)Ratio of expenses before waivers to average managed assets equals 3.58%.  
(5)Ratio of expenses after waivers to average managed assets equals 3.58%.  
(6)Ratio of net investment income to average managed assets equals 6.05%.  
(7)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 in 000's.   
* Annualized    
**Not-annualized