Oxford Square Capital Corp. Announces Net Asset Value and Selected Financial Results for the Quarter Ended March 31, 2021 and Declaration of Distributions of Common Stock for the Months Ending July 31, August 31, and September 30, 2021

Greenwich, Connecticut, UNITED STATES


GREENWICH, Conn., April 27, 2021 (GLOBE NEWSWIRE) -- Oxford Square Capital Corp. (NasdaqGS: OXSQ) (NasdaqGS: OXSQL) (NasdaqGS: OXSQZ) (the “Company,” “we,” “us” or “our”) announced today its financial results and related information for the quarter ended March 31, 2021.

  • As of March 31, 2021, net asset value (“NAV”) per share was $4.88, compared with the NAV per share of $4.55 at the prior quarter end.
    • For the quarter ended March 31, 2021 we recorded GAAP net investment income of approximately $4.8 million, or $0.10 per share.
    • We recorded net unrealized appreciation of approximately $31.0 million and net realized losses on investments of approximately $14.1 million for the quarter ended March 31, 2021, compared to net unrealized appreciation of approximately $35.7 million and net realized losses on investments of approximately $0.7 million for the quarter ended December 31, 2020.
    • In total, we had a net increase in net assets from operations of approximately $21.8 million, or $0.44 per share, for the quarter ended March 31, 2021, compared with a net increase in net assets from operations of approximately $39.7 million, or $0.80 per share, for the quarter ended December 31, 2020.
  • Total investment income for the quarter ended March 31, 2021 amounted to approximately $9.4 million, compared with approximately $8.6 million for the quarter ended December 31, 2020. For the quarter ended March 31, 2021 the components of investment income were as follows:
    • $4.2 million from our debt investments
    • $4.7 million from our CLO equity investments
    • $0.5 million from other income
  • Our total expenses for the quarter ended March 31, 2021 were approximately $4.5 million, compared with total expenses of approximately $3.9 million for the fourth quarter of 2020.
  • During the first quarter of 2021, we made investments of approximately $32.9 million and recorded proceeds of approximately $1.8 million from sales of investments, and $16.4 million from repayments and amortization payments on our debt investments.
  • As of March 31, 2021, the following metrics applied (note that none of these values represents a total return to shareholders):
    • The weighted average yield of our debt investments was 7.7% at current cost, compared with 8.0% as of December 31, 2020.
    • The weighted average effective yield of our CLO equity investments at current cost was 9.4%, compared with 8.0% as of December 31, 2020.
    • The weighted average cash distribution yield of our cash income producing CLO equity investments at current cost was 17.9%, compared with 19.2% as of December 31, 2020.

  • Our weighted average credit rating was 2.1 based on total fair value and 2.2 based on total principal amount as of March 31, 2021, compared to 2.1 based on total fair value and 2.4 based on total principal amount as of December 31, 2020.
  • As of March 31, 2021, we had one debt investment on non-accrual status, with a fair value of $3.6 million. Also, as of March 31, 2021, our preferred equity investments in one of our portfolio companies were on non-accrual status, which had zero fair value.
  • On April 22, 2021, our Board of Directors declared the following distributions on our common stock:
Month EndingRecord DatePayment DateAmount Per Share
July 31, 2021July 16, 2021July 30, 2021$0.035
August 31, 2021August 17, 2021August 31, 2021$0.035
September 30, 2021September 16, 2021September 30, 2021$0.035

We will hold a conference call to discuss first quarter results today, Tuesday, April 27th, 2021 at 9:00 AM ET. The toll-free dial-in number is 1-888-339-0740. There will be a recording available for 30 days. If you are interested in hearing the recording, please dial 1-877-344-7529. The replay pass-code number is 10155686.

A presentation containing further detail regarding our quarterly results of operations has been posted under the Investor Relations section of our website at www.oxfordsquarecapital.com.

OXFORD SQUARE CAPITAL CORP.

CONSOLIDATED STATEMENTS OF ASSETS AND LIABILITIES

  March 31,
2021
 December 31,
2020
  (unaudited)  
ASSETS        
Non-affiliated/non-control investments (cost: $402,424,840 and
   $407,547,351, respectively)
 $320,597,611  $294,674,000 
Affiliated investments (cost: $16,836,822 and $16,836,822, respectively)      
Cash equivalents  39,749,201   59,137,284 
Interest and distributions receivable  1,747,323   2,299,259 
Securities sold not settled     950,000 
Other assets  566,971   597,238 
Total assets $362,661,106  $357,657,781 
LIABILITIES        
Notes payable – 6.50% Unsecured Notes, net of deferred issuance
   costs of $975,001 and $1,055,065, respectively
 $63,395,224  $63,315,160 
Notes payable – 6.25% Unsecured Notes, net of deferred issuance
   costs of $1,185,591 and $1,243,082, respectively
  43,605,159   43,547,668 
Securities purchased not settled  10,945,000   23,156,556 
Base Fee and Net Investment Income Incentive Fee payable to affiliate  1,389,250   1,159,703 
Accrued interest payable  478,191   478,191 
Accrued expenses  802,669   573,977 
Total liabilities  120,615,493   132,231,255 
COMMITMENTS AND CONTINGENCIES (Note 13)        
NET ASSETS        
Common stock, $0.01 par value, 100,000,000 shares authorized;
   49,597,964 and 49,589,607 shares issued and outstanding,
   respectively
  495,979   495,895 
Capital in excess of par value  452,686,971   452,650,210 
Total distributable earnings/(accumulated losses)  (211,137,337)  (227,719,579)
Total net assets  242,045,613   225,426,526 
Total liabilities and net assets $362,661,106  $357,657,781 
Net asset value per common share $4.88  $4.55 


OXFORD SQUARE CAPITAL CORP.

CONSOLIDATED STATEMENTS OF OPERATIONS – (unaudited)

  Three Months Ended
March 31,
2021
 Three Months Ended
March 31,
2020
INVESTMENT INCOME        
From non-affiliated/non-control investments:        
Interest income – debt investments $4,222,037  $5,654,255 
Income from securitization vehicles and investments  4,681,300   4,759,070 
Other income  456,353   411,363 
Total investment income from non-affiliated/non-control investments  9,359,690   10,824,688 
Total investment income  9,359,690   10,824,688 
EXPENSES        
Interest expense  1,883,425   2,173,468 
Base Fee  1,389,250   1,231,210 
Professional fees  684,954   473,989 
Compensation expense  172,722   200,348 
General and administrative  415,175   373,182 
Total expenses before incentive fees  4,545,526   4,452,197 
Net Investment Income Incentive Fees      
Total expenses  4,545,526   4,452,197 
Net investment income  4,814,164   6,372,491 
Net change in unrealized appreciation/(depreciation) on investments:        
Non-Affiliate/non-control investments  31,046,122   (83,015,626)
Affiliated investments     (2,432,494)
Total net change in unrealized appreciation/(depreciation) on investments  31,046,122   (85,448,120)
Net realized losses:        
Non-affiliated/non-control investments  (14,071,131)  (277,173)
Extinguishment of debt     (5,211)
Total net realized losses  (14,071,131)  (282,384)
Net increase/(decrease) in net assets resulting from operations $ 21,789,155  $ (79,358,013)
Net increase in net assets resulting from net investment income per common share (Basic and
   Diluted):
 $0.10  $0.13 
Net increase/(decrease) in net assets resulting from operations per common share (Basic and
   Diluted):
 $0.44  $(1.62)
Weighted average shares of common stock outstanding (Basic and Diluted):  49,589,700   49,137,570 
Distributions per share $0.105  $0.201 


FINANCIAL HIGHLIGHTS – (unaudited)

  Three Months
Ended
March 31,
2021
 Three Months
Ended
March 31,
2020
Per Share Data        
Net asset value at beginning of period $ 4.55  $ 5.12 
Net investment income(1)   0.10    0.13 
Net realized and unrealized gains/(losses)(2)   0.34    (1.73)
Net increase/(decrease) in net asset value from operations   0.44    (1.60)
Distributions per share from net investment income   (0.09)   (0.17)
Tax return of capital distributions(3)   (0.02)   (0.03)
Total distributions   (0.11)   (0.20)
Effect of shares issued/repurchased, gross        
Net asset value at end of period $ 4.88  $ 3.32 
Per share market value at beginning of period $ 3.05  $ 5.44 
Per share market value at end of period $ 4.64  $ 2.55 
Total return based on Market Value(4)   56.22%   (50.73)%
Total return based on Net Asset Value(5)   9.56%   (31.25)%
Shares outstanding at end of period   49,597,964    49,589,607 
         
Ratios/Supplemental Data(8)        
Net assets at end of period (000’s)   $242,046    $164,739 
Average net assets (000’s)   233,736    207,092 
Ratio of expenses to average net assets(6)   7.78%   8.60%
Ratio of net investment income to average net assets(6)   8.24%   12.31%
Portfolio turnover rate(7)   6.38%   2.17%

____________

(1)Represents per share net investment income for the period, based upon weighted average shares outstanding.
(2)Net realized and unrealized gains/(losses) include rounding adjustments to reconcile change in net asset value per share.
(3)Management monitors available taxable earnings, including net investment income and realized capital gains, to determine if a tax return of capital may occur for the year. To the extent the Company’s taxable earnings fall below the total amount of the Company’s distributions for that fiscal year, a portion of those distributions may be deemed a tax return of capital to the Company’s stockholders. The ultimate tax character of the Company’s earnings cannot be determined until tax returns are prepared after the end of the fiscal year. The amounts and sources of distributions reported are only estimates (based on an average of the reported tax character historically) and are not being provided for U.S. tax reporting purposes.
(4)Total return based on market value equals the increase or decrease of ending market value over beginning market value, plus distributions, divided by the beginning market value, assuming distribution reinvestment prices obtained under the Company’s distribution reinvestment plan, excluding any discounts. Total return is not annualized.
(5)Total return based on net asset value equals the increase or decrease of ending net asset value over beginning net asset value, plus distributions, divided by the beginning net asset value. Total return is not annualized.
(6)Annualized.
(7)Portfolio turnover rate is calculated using the lesser of the year-to-date cash investment sales and debt repayments or year-to-date cash investment purchases over the average of the total investments at fair value.
(8)The following table provides supplemental performance ratios (annualized) measured for the three months ended March 31, 2021 and 2020:

      

    Three Months
Ended
March 31,
2021
 Three Months
Ended
March 31,
2020
Ratio of expenses to average net assets:      
Operating expenses before incentive fees 7.78% 8.60%
Net investment income incentive fees % %
Ratio of expenses, excluding interest expense to average net assets 4.56% 4.40%

About Oxford Square Capital Corp.

Oxford Square Capital Corp. is a publicly-traded business development company principally investing in syndicated bank loans and debt and equity tranches of collateralized loan obligation (“CLO”) vehicles. CLO investments may also include warehouse facilities, which are financing structures intended to aggregate loans that may be used to form the basis of a CLO vehicle.

Forward-Looking Statements

This press release contains forward-looking statements subject to the inherent uncertainties in predicting future results and conditions. Any statements that are not statements of historical fact (including statements containing the words “believes,” “plans,” “anticipates,” “expects,” “estimates” and similar expressions) should also be considered to be forward-looking statements. These statements are not guarantees of future performance, conditions or results and involve a number of risks and uncertainties, including the impact of COVID-19 and related changes in base interest rates and significant market volatility on our business, our portfolio companies, our industry and the global economy.  Certain factors could cause actual results and conditions to differ materially from those projected in these forward-looking statements. These factors are identified from time to time in our filings with the Securities and Exchange Commission. We undertake no obligation to update such statements to reflect subsequent events, except as may be required by law.

Contact:
Bruce Rubin
203-983-5280