UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
______________________

Form 8-K
______________________

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report (Date of earliest event Reported): February 6, 2019  

Gladstone Capital Corporation
(Exact Name of Registrant as Specified in Charter)

Maryland814-00237
54-2040781
(State or Other Jurisdiction of Incorporation)(Commission File Number)(I.R.S. Employer Identification Number)

 

1521 Westbranch Drive, Suite 100
McLean, Virginia
22102
(Address of Principal Executive Offices) (Zip Code)

(703) 287-5800
(Registrant's telephone number, including area code)


(Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

 [   ]  Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
 [   ]  Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
 [   ]  Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
 [   ]  Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

 

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (17 CFR §230.405) or Rule 12b-2 of the Securities Exchange Act of 1934 (17 CFR §240.12b-2). Emerging growth company [ ]

 

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. [ ]

 
 

Item 2.02. Results of Operations and Financial Condition.

On February 6, 2019, Gladstone Capital Corporation issued a press release announcing its financial results for the quarter ended December 31, 2018.  The text of the press release is included as an exhibit to this Current Report on Form 8-K.  The information in this Current Report on Form 8-K, including Exhibit 99.1 attached hereto, is being furnished and shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act, regardless of any general incorporation language in such filing.

Item 9.01. Financial Statements and Exhibits.

(d)          Exhibits.

Exhibit No. Description
99.1 Press Release of Gladstone Capital Corporation, dated February 6, 2019.


SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

 Gladstone Capital Corporation
   
   
Date: February 6, 2019By: /s/ Nicole Schaltenbrand        
  Nicole Schaltenbrand
  Chief Financial Officer
  

EdgarFiling

EXHIBIT 99.1

Gladstone Capital Corporation Reports Financial Results for its First Quarter Ended December 31, 2018

MCLEAN, Va., Feb. 06, 2019 (GLOBE NEWSWIRE) -- Gladstone Capital Corporation (NASDAQ: GLAD) (the “Company”) today announced earnings for its first fiscal quarter ended December 31, 2018.  Please read the Company’s Quarterly Report on Form 10-Q filed today with the U.S. Securities and Exchange Commission (the “SEC”), which is available on the SEC’s website at www.sec.gov, and the investor relations section of the Company’s website at www.GladstoneCapital.com. 

Summary Information (dollars in thousands, except per share data) (unaudited):

          
  December 31, September 30,  Change % Change 
For the Quarter Ended:20182018
          
Total investment income $11,909 $11,257 $652 5.8%
Total expenses, net of credits (5,923)(5,355)(568)10.6 
Net investment income 5,986 5,902 84 1.4 
Net investment income per common share 0.21 0.21   
Cash distribution per common share 0.21 0.21   
Net realized loss  (26,863)(27,160)297 (1.1)
Net unrealized appreciation  17,169 11,349 5,820 51.3 
Net decrease in net assets resulting from operations (3,708)(9,909)6,201 (62.6)
Weighted average yield on interest-bearing investments 12.3%11.9%0.4%3.4 
Total invested $59,228 $10,095 $49,133 486.7 
Total repayments and net proceeds 8,855 9,547 (692)(7.2)
          
As of: December 31, September 30, Change % Change 
20182018
Total investments, at fair value  $  $390,046 $41,101 10.5%
431,147
Fair value, as a percent of cost 95.5%91.2%4.3%4.7 
Net asset value per common share $7.98 $8.32 $(0.34)(4.1)
             

First Fiscal Quarter 2019 Highlights:

First Fiscal Quarter 2019 Results:

Interest income increased by $0.8 million, or 7.7%, primarily due to increases in both the weighted average yield and the weighted average balance of our interest bearing portfolio quarter over quarter. Other income decreased by $0.2 million, quarter over quarter due to a decrease in dividend income. Total expenses increased by $0.6 million, or 10.6%, compared to the prior quarter primarily due to an increase in interest expense driven by an increase in the average debt outstanding used to fund the new investments made during the quarter ended December 31, 2018.

Net Investment Income for the quarter ended December 31, 2018 was $6.0 million, an increase of 1.4% as compared to the prior quarter, or $0.21 per share.   

The Net Decrease in Net Assets Resulting from Operations for the quarter ended December 31, 2018 was $3.7 million, or $0.13 per share, compared to $9.9 million, or $0.35 per share for the quarter ended September 30, 2018. The current quarter decrease was driven primarily by $26.9 million of net realized loss  from the restructure of Francis Drilling Fluids, Ltd. (“FDF”), partially offset by $17.2 million of net unrealized appreciation during the period associated with the reversal of accumulated unrealized depreciation on FDF.

Subsequent Events:  Subsequent to December 31, 2018, the following significant events occurred:

       
Record Date Payment Date Distribution per
Common Share
 Distribution per
Series 2024 Term
Preferred Share
January 18, 2019 January 31, 2019 $0.07 $0.125
February 20, 2019 February 28, 2019 0.07 0.125
March 20, 2019 March 29, 2019 0.07 0.125
  Total for the Quarter $0.21 $0.375
         

Comments from Gladstone Capital’s President, Bob Marcotte: “Strong net originations and higher average investment yields lifted our interest income for the quarter ended December 31, 2018 to a new record, and position us well to absorb potential prepayments and continue to grow our net investment income.  The conclusion of the restructuring of FDF was difficult; however, the balance of the portfolio is performing well despite the valuation erosion associated with the liquidity sell-off in the syndicated loan market at December 31, 2018 much of which has already recovered.  The plan for the balance of fiscal 2019 is to continue to drive interest income by remaining reasonably fully invested while generating higher fee income associated with increased prepayments to enable us to enhance the returns to our shareholders in the coming quarters.”

Conference Call for Stockholders: The Company will hold its earnings release conference call on Thursday, February 7, 2019, at 8:30 a.m. EST.  Please call (855) 465-0177 to enter the conference.  An operator will monitor the call and set a queue for any questions. A replay of the conference call will be available through February 14, 2019.  To hear the replay, please dial (855) 859-2056 and use conference number 3098326.  The replay of the conference call will be available beginning approximately one hour after the call concludes. The live audio broadcast of the Company’s quarterly conference call will also be available online at www.GladstoneCapital.com.  The event will be archived and available for replay on the Company’s website through April 7, 2019.

About Gladstone Capital Corporation: Gladstone Capital Corporation is a publicly traded business development company that invests in debt and equity securities, consisting primarily of secured first and second lien term loans to lower middle market businesses in the United States.  Including distributions through today, the Company has paid 192 consecutive monthly or quarterly cash distributions on its common stock.  Information on the business activities of all the Gladstone funds can be found at www.GladstoneCompanies.com.   

To obtain a paper copy of the Company’s most recent Form 10-Q, please contact the Company at 1521 Westbranch Drive, Suite 100, McLean, VA 22102, ATTN:  Investor Relations.  The financial information above is not comprehensive and is without notes, so readers should obtain and carefully review the Company’s Form 10-Q for the quarter ended December 31, 2018, including the notes to the consolidated financial statements contained therein.

Investor Relations Inquiries: Please visit www.gladstonecompanies.com or +1-703-287-5893.

Forward-looking Statements:
The statements in this press release about future growth and shareholder returns are "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended.  These forward-looking statements inherently involve certain risks and uncertainties in predicting future results and conditions. Although these statements are based on our current plans that are believed to be reasonable as of the date of this press release, a number of factors could cause actual results and conditions to differ materially from these forward-looking statements, including those factors described from time to time in our filings with the U.S. Securities and Exchange Commission. The Company undertakes no obligation to publicly release the result of any revisions to these forward looking statements that may be made to reflect any future events or otherwise, except as required by law.