Triangle Capital Corporation Reports Fourth Quarter and Full Year 2015 Results

RALEIGH, N.C. -- Triangle Capital Corporation (NYSE:TCAP) ("Triangle" or the "Company"), a leading provider of capital to lower middle market companies, recently announced its financial and operating results for the fourth quarter of 2015 and the full year of 2015. In commenting on the Company's results, E. Ashton Poole, President and Chief Executive Officer, stated, "We are pleased to report a strong finish to 2015, capping a year where we reported net investment income per share equal to our base dividend of $2.16 per share, invested over $450 million of capital, and generated a 5.8% total return to shareholders, as compared to the S&P 500's total return of 1.4%. As we move into 2016, we believe our investing platform is well positioned to continue capitalizing on the attractive opportunities the lower middle market provides."


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Fourth Quarter 2015 Results

Total investment income during the fourth quarter of 2015 was $31.8 million, compared to total investment income of $30.7 million for the fourth quarter of 2014, representing an increase of 3.9%. The increase in investment income was primarily attributable to higher average portfolio loan balances from December 31, 2014 to December 31, 2015, partially offset by a decrease in the weighted average yield on our debt investments from December 31, 2014 to December 31, 2015.

Net investment income during the fourth quarter of 2015 was $19.2 million, compared to net investment income of $18.1 million for the fourth quarter of 2014, representing an increase of 6.0%. Net investment income per share during the fourth quarter of 2015 was $0.58, based on weighted average shares outstanding during the quarter of 33.3 million, compared to $0.55 per share during the fourth quarter of 2014, based on weighted average shares outstanding of 32.9 million.

The Company's net increase in net assets resulting from operations was $9.5 million during the fourth quarter of 2015, compared to $0.5 million during the fourth quarter of 2014.  The Company's net increase in net assets resulting from operations was $0.28 per share during the fourth quarter of 2015, based on weighted average shares outstanding of 33.3 million, compared to $0.01 per share during the fourth quarter of 2014, based on weighted average shares outstanding of 32.9 million.

Full Year 2015 Results

For the year ended December 31, 2015, total investment income was $121.3 million, compared to total investment income of $104.5 million for the year ended December 31, 2014, representing an increase of 16.1%. The increase was primarily due to higher average portfolio loan balances from December 31, 2014 to December 31, 2015 and an increase in non-recurring income of $4.3 million.  These increases were partially offset by a $0.6 million decrease in investment income relating to non-accrual assets and a decrease in the weighted average yield on our debt investments from December 31, 2014 to December 31, 2015.

Net investment income for 2015 was $71.6 million, compared to net investment income of $62.0 million during 2014, representing an increase of 15.5%.  Net investment income per share during 2015 was $2.16, based on a weighted average share count of 33.2 million, compared to $2.08 per share during 2014, based on a weighted average share count of 29.8 million.

The Company's net increase in net assets resulting from operations during the year ended December 31, 2015, was $47.9 million, compared to $28.4 million for the year ended December 31, 2014.  The Company's net increase in net assets resulting from operations was $1.44 per share during 2015, based on the Company's weighted average shares outstanding of 33.2 million, compared to $0.95 per share in 2014, based on the Company's weighted average shares outstanding of 29.8 million.

The Company's net asset value per share at December 31, 2015, was $15.23, based on total shares outstanding at December 31, 2015, of 33.4 million, compared to the Company's net asset value per share at December 31, 2014, of $16.11, based on total shares outstanding at December 31, 2014, of 33.0 million.  As of December 31, 2015, the Company's weighted average yield on all of its outstanding debt investments (other than non-accrual debt investments) was 12.2%, compared to 13.0% at December 31, 2014.

Liquidity and Capital Resources

Commenting on the Company's liquidity position, Steven C. Lilly, Chief Financial Officer of the Company, stated, "Our financing activities in 2015, which included expanding our $300 million senior credit facility and issuing new notes of $86 million, further strengthened Triangle's balance sheet and put us in a strong position entering 2016 with over $220 million of available liquidity."

At December 31, 2015, the Company had cash and cash equivalents totaling $52.6 million and $168.7 million of available borrowing capacity under its $300.0 million senior credit facility.

As of December 31, 2015, the Company had outstanding non-callable, fixed-rate Small Business Administration ("SBA") guaranteed debentures totaling $225.0 million with a weighted average interest rate of 4.02%.

Recent Portfolio Activity

During the year ended December 31, 2015, the Company made twenty-three new investments, including recapitalizations of existing portfolio companies, totaling $361.2 million, additional debt investments in ten existing portfolio companies of $84.2 million and additional equity investments in eleven existing portfolio companies totaling $8.6 million.  The Company had twenty-four portfolio company loans repaid at par totaling $302.1 million, which resulted in realized gains totaling $2.0 million, and received normal principal repayments, partial loan repayments and PIK interest repayments totaling $32.7 million.  The Company converted subordinated debt investments in one portfolio company into an equity investment and recognized a net realized loss on such conversion totaling $20.5 million.  The Company wrote-off debt and equity investments in two portfolio companies and recognized realized losses on the write-offs of $18.8 million.  In addition, the Company received proceeds related to the sales of certain equity securities totaling $21.5 million and recognized net realized gains on such sales totaling $9.8 million.

New investment transactions which occurred during the fourth quarter of 2015 are summarized as follows:

In October, 2015, the Company made a $16.7 million subordinated debt investment in Danville Materials, LLC ("Danville") as part of a recapitalization financing. Danville designs, manufactures and sells dental equipment and materials.

In October, 2015, the Company made a $16.5 million investment in California Products Corporation ("CPC") consisting of subordinated debt and equity. CPC formulates and manufactures coatings for sports surfaces, coatings for specialty construction containment, and paint products.

In December, 2015, the Company made a $0.8 million investment in KT Capital Partners, L.P. ("KT Capital") consisting of subordinated debt and equity. KT Capital is a private equity fund that focuses on change-of-control financing.

In December, 2015, the Company made a $16.5 million investment in Captek Softgel International, Inc. ("Captek") consisting of subordinated debt and equity as part of a recapitalization financing. Captek is an integrated manufacturer, packager and marketer of custom designed soft gel nutraceutical products.

In December, 2015, the Company made a $17.9 million investment in Women's Marketing, Inc. ("WMI") consisting of subordinated debt and equity. WMI is a full-service media strategy, planning and buying organization serving beauty, fashion, health, and food and beverage brands.

About Triangle Capital Corporation

Triangle Capital Corporation (www.TCAP.com) invests capital in established companies in the lower middle market to fund growth, changes of control and other corporate events.  Triangle offers a wide variety of investment structures with a primary focus on mezzanine financing with equity components.  Triangle's investment objective is to seek attractive returns by generating current income from debt investments and capital appreciation from equity related investments.  Triangle's investment philosophy is to partner with business owners, management teams and financial sponsors to provide flexible financing solutions.  Triangle typically invests $5.0 million - $35.0 million per transaction in companies with annual revenues between $20.0 million and $200.0 million and EBITDA between $3.0 million and $35.0 million.

Triangle has elected to be treated as a business development company under the Investment Company Act of 1940 ("1940 Act").  Triangle is required to comply with a series of regulatory requirements under the 1940 Act as well as applicable NYSE, federal and state laws and regulations.  Triangle has elected to be treated as a regulated investment company under the Internal Revenue Code of 1986.  Failure to comply with any of the laws and regulations that apply to Triangle could have a material adverse effect on Triangle and its stockholders.