MVC Capital, Inc. (NYSE: MVC), a publicly traded
business development company that makes private debt and equity
investments, today announced financial results for the third quarter
ended July 31, 2006.
As of July 31, 2006, the Fund's net assets were approximately $223.4 million, or $11.70 per share, compared with net assets of approximately $217.6 million, or $11.40 per share, at the beginning of the quarter, after taking into account a dividend of $0.12 per share, or approximately $2.3 million, declared by the board on July 14, 2006 and paid July 31, 2006. The net increase in net assets resulting from operations was $31.5 million for the nine month period ended July 31, 2006 as compared to $17.3 million for the nine month period ended July 31, 2005. The change in net assets from operations for the third quarter was $8.0 million as compared to $10.3 million for the same period last year.
During the quarter, the Fund committed total capital of approximately $51.1 million, its strongest investment activity pace within a quarter since the Fund's current management team was put in place. The Fund made new investments in BP Clothing, LLC, Marine Exhibition Corporation, PreVisor, Inc., and Velocitus B.V., as well as in various loan assignments. Follow-on investments were made in Amersham Corp. and Phoenix Coal Corporation. Also during the quarter, the Fund was added to the Russell 3000(R) Index, Russell 2000(R) Index and Russell MicrocapTM Index.
During the third quarter of 2006, the Fund earned approximately $3.4 million in interest and dividend income and approximately $1.2 million in fee and other income, representing an increase in total operating income of approximately $200,000 or 5% as compared to the same quarter in 2005. During this active quarter, the Fund experienced an increase of $630,000 in interest and other borrowing costs (compared to the same period in 2005) as it utilized a larger portion of the new $100 million credit facility. This increase, together with a $760,000 increase (over the same period in 2005) in the provision for incentive compensation (which resulted from various increases in portfolio company valuations during the quarter), were among the factors resulting in the Fund reporting a net operating income of $1.1 million for the quarter. This represented a decrease of $1.4 million from the same period in 2005, even though the Fund enjoyed a 5% increase in total operating income over the same period.
Subsequent to the quarter-end and through September 5, 2006, the Fund committed capital to Summit Research Labs, Inc., a specialty chemical company that manufactures antiperspirant actives, and Harmony Pharmacy & Health Centers, Inc., an operator of pharmacy and healthcare centers primarily in airports across the United States.
About MVC Capital, Inc.
MVC Capital is a Business Development Company traded on the New York Stock Exchange that provides long-term debt and equity investment capital to fund growth, acquisitions and recapitalizations of companies in a variety of industries. For additional information about MVC Capital, please visit MVC's website at www.mvccapital.com. For MVC's investor relations, please call 914-510-9400. All media inquiries should be directed to Kim Levy or Nat Garnick at 212-687-8080.
Forward-Looking Statements
The information contained in this press release contains forward-looking statements. These forward-looking statements are subject to the inherent uncertainties in predicting future results and conditions. Certain factors could cause actual results and conditions to differ materially from those projected in these forward-looking statements, and these factors are enumerated in the company's periodic filings with the Securities and Exchange Commission.
As of July 31, 2006, the Fund's net assets were approximately $223.4 million, or $11.70 per share, compared with net assets of approximately $217.6 million, or $11.40 per share, at the beginning of the quarter, after taking into account a dividend of $0.12 per share, or approximately $2.3 million, declared by the board on July 14, 2006 and paid July 31, 2006. The net increase in net assets resulting from operations was $31.5 million for the nine month period ended July 31, 2006 as compared to $17.3 million for the nine month period ended July 31, 2005. The change in net assets from operations for the third quarter was $8.0 million as compared to $10.3 million for the same period last year.
During the quarter, the Fund committed total capital of approximately $51.1 million, its strongest investment activity pace within a quarter since the Fund's current management team was put in place. The Fund made new investments in BP Clothing, LLC, Marine Exhibition Corporation, PreVisor, Inc., and Velocitus B.V., as well as in various loan assignments. Follow-on investments were made in Amersham Corp. and Phoenix Coal Corporation. Also during the quarter, the Fund was added to the Russell 3000(R) Index, Russell 2000(R) Index and Russell MicrocapTM Index.
During the third quarter of 2006, the Fund earned approximately $3.4 million in interest and dividend income and approximately $1.2 million in fee and other income, representing an increase in total operating income of approximately $200,000 or 5% as compared to the same quarter in 2005. During this active quarter, the Fund experienced an increase of $630,000 in interest and other borrowing costs (compared to the same period in 2005) as it utilized a larger portion of the new $100 million credit facility. This increase, together with a $760,000 increase (over the same period in 2005) in the provision for incentive compensation (which resulted from various increases in portfolio company valuations during the quarter), were among the factors resulting in the Fund reporting a net operating income of $1.1 million for the quarter. This represented a decrease of $1.4 million from the same period in 2005, even though the Fund enjoyed a 5% increase in total operating income over the same period.
Subsequent to the quarter-end and through September 5, 2006, the Fund committed capital to Summit Research Labs, Inc., a specialty chemical company that manufactures antiperspirant actives, and Harmony Pharmacy & Health Centers, Inc., an operator of pharmacy and healthcare centers primarily in airports across the United States.
About MVC Capital, Inc.
MVC Capital is a Business Development Company traded on the New York Stock Exchange that provides long-term debt and equity investment capital to fund growth, acquisitions and recapitalizations of companies in a variety of industries. For additional information about MVC Capital, please visit MVC's website at www.mvccapital.com. For MVC's investor relations, please call 914-510-9400. All media inquiries should be directed to Kim Levy or Nat Garnick at 212-687-8080.
Forward-Looking Statements
The information contained in this press release contains forward-looking statements. These forward-looking statements are subject to the inherent uncertainties in predicting future results and conditions. Certain factors could cause actual results and conditions to differ materially from those projected in these forward-looking statements, and these factors are enumerated in the company's periodic filings with the Securities and Exchange Commission.