Allied Capital Corp. announces 1994 results.WASHINGTON--(BUSINESS WIRE)--Feb. 21, 1994--Allied Capital Corp. (NASDAQ NASDAQ in full National Association of Securities Dealers Automated Quotations U.S. market for over-the-counter securities. Established in 1971 by the National Association of Securities Dealers (NASD), NASDAQ is an automated quotation system that reports on :ALLC ALLC Association for Literary and Linguistic Computing ALLC Allied Capital Corporation (stock symbol) ALLC Army Logistics Leadership Center (Red River Defense Complex, Texarkana, TX) ) announced 1994 results Tuesday Tuesday: see week. . For the year ended Dec. 31, 1994, net realized income, which includes ordinary investment income and realized capital gains and losses but excludes the effect of unrealized appreciation and depreciation, was $5.5 million or 90 cents per share Cents per share The amount of a mutual fund's dividend or capital gains distributions that a shareholder will receive for each share owned. , a 33% decrease from $8.2 million or $1.35 per share in 1993. Due to changes in the Small Business Administration's government guaranteed loan program that were announced in December December: see month. of 1994, the market price of the company's investment in Allied Capital Lending Capital lending is the process of a large company, or corporation, offering financing on large "ticket" items to encourage the customer to purchase that item. Many major corporations have set up finance divisions, or subsidiaries, to help the customer purchase their product over Corp. declined to $10.38 per share at Dec. 31, 1994. At Dec. 31, 1993, the market price for this stock was $15.75 per share. During the fourth quarter of 1994, the company chose to distribute shares of Allied Capital Lending Corp. to its shareholders rather than sell these shares at depressed prices Depressed price In the context of stocks, stock whose market price is low in comparison to stocks in its sector. . The gain that was recognized on this transaction reflects the decreased market value at the end of the year, and as a result, depressed Depressed A description of a market, security, or product that is experiencing weak demand and lowering prices. Notes: A depressed market, security, or product implies that prices and volume are low. There are many reasons for a depressed market, security, or product. the company's net realized income. The company does not believe that the recently announced changes in the government guaranteed loan program will have any long-term Long-term Three or more years. In the context of accounting, more than 1 year. long-term 1. Of or relating to a gain or loss in the value of a security that has been held over a specific length of time. Compare short-term. adverse impact on the value of its investment in Allied Capital Lending Corp.; however, the effect of the recent decline in market price was reflected in 1994 operating results. During 1993, the company recorded realized gains Realized Gain A gain resulting from selling an asset at a price higher than the original purchase price. Notes: There may be tax consequences for a realized profit. of approximately ap·prox·i·mate adj. 1. Almost exact or correct: the approximate time of the accident. 2. $9 million and unrealized appreciation of approximately $15 million, resulting from the 1993 initial public offering of the stock of Allied Capital Lending Corp., formerly a wholly owned subsidiary Wholly Owned Subsidiary A subsidiary whose parent company owns 100% of its common stock. Notes: In other words, the parent company owns the company outright and there are no minority owners. of the company. Net income, which includes unrealized appreciation and depreciation in the portfolio, was $224,000 or approximately breakeven breakeven 1. The level of output or sales necessary to cover fixed expenses. Companies in industries that have high fixed costs and, consequently, high breakevens, such as automobile and steel manufacturing, are likely to exhibit large fluctuations on a per share basis after payment of dividends to the preferred stock Stock shares that have preferential rights to dividends or to amounts distributable on liquidation, or to both, ahead of common shareholders. Preferred stock is given preference over common stock. Holders of preferred stock receive dividends at a fixed annual rate. shareholder, as compared to $20,406,000 or $3.29 per share for the year ended Dec. 31, 1993. Net income also decreased primarily due to the decline in market value at Dec. 31, 1994 of Allied Capital Lending Corp., which reduced 1994 income by $4.1 million or 66 cents per share. Total distributions of taxable income Under the federal tax law, gross income reduced by adjustments and allowable deductions. It is the income against which tax rates are applied to compute an individual or entity's tax liability. The essence of taxable income is the accrual of some gain, profit, or benefit to a taxpayer. , including four regular quarterly dividends and an annual extra dividend, were $1.40 per share, a 4% increase over the prior year's dividends and distributions of $1.35 per share, resulting in an effective yield to shareholders of 10.6% using the Dec. 30, 1994 market price. During the fourth quarter of 1994, Allied Capital Corp. invested approximately $11 million in new or existing portfolio companies. For the year, total new and follow-on fol·low-on adj. Following as a related or consequent aspect or development: "Such contracts involve follow-on sales of maintenance services" Christian Science Monitor. investments were approximately $36 million, a 50% increase over new investments of approximately $24 million in 1993. Net of repayments and changes in portfolio valuations, the company increased its total investments in small businesses by approximately $20 million or 22% during the year. This strong increase in investment activity will result in improved investment income in future years, as the company has made significant progress during the year in decreasing the level of cash and low-yielding government securities in the portfolio, and replacing those investments with high-yielding investments in growing small businesses. At Dec. 31, 1994, investments in small businesses totaled 85% of the company's total assets, as compared to 70% at Dec. 31, 1993. -0-
(in thousands) 12 mos. ended 12 mos. ended
12/31/94 Per share 12/31/93 Per share
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Financial Position
Information
------------------
Total investments $115,026 -- $94,630 --
Total assets 135,517 -- 134,606 --
Common shareholders'
equity (NAV) 43,987 $ 7.15 52,185 $ 8.54
Operating Information
---------------------
Net investment income $ 2,126 $ 0.35 $ 2,300 $ 0.38
Net realized gains 3,394 0.55 5,943 0.97
----- -----
Net realized income 5,520 0.90 8,243 1.35
Net unrealized apprec
(deprec) (5,296) (0.86) 12,163 1.98
------- ------
Net income(a) $ 224 0.00 $20,406 3.29
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Actual shares outstanding 6,153 -- 6,108 -- Weighted avg. shares outstanding 6,154 -- 6,127 --
Distributions to
Shareholders
------------------
Regular dividends -- $ 0.80 -- $ 0.80
Extra distribution -- 0.60 -- 0.55
Total distributions -- $ 1.40 -- $ 1.35
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(in thousands) 3 mos. ended 3 mos. ended
12/31/94 Per share 12/31/93 Per share
-------- --------- -------- ---------
Financial Position
Information
------------------
Total investments $115,026 -- $94,630 --
Total assets 135,517 -- 134,606 --
Common shareholders'
equity (NAV) 43,987 $ 7.15 52,185 $ 8.54
Operating Information
---------------------
Net investment income $ 1,273 $ 0.21 $ (19) $ (0.00)
Net realized gains 1,369 0.22 6,086 0.99
----- -----
Net realized income 2,642 0.43 6,067 0.99
Net unrealized apprec
(deprec) (5,756) (0.94) 13,087 2.14
------- ------
Net income (a) $(3,114) (0.52) $19,154 3.11
Actual shares outstanding 6,153 -- 6,109 -- Weighted avg. shares outstanding 6,143 -- 6,123 --
Distributions to
Shareholders
----------------
Regular dividends -- $ 0.20 -- $ 0.20
Extra distribution -- 0.60 -- 0.55
---- ----
Total distributions -- $ 0.80 -- $ 0.75
======= =======
-0- (a) Net income has been reduced by preferred stock dividends for the calculation of earnings per common share. -0- Allied Capital Corp. is a publicly traded venture capital company, headquartered in Washington Washington, town, England Washington, town (1991 pop. 48,856), Sunderland metropolitan district, NE England. Washington was designated one of the new towns in 1964 to alleviate overpopulation in the Tyneside-Wearside area. , D.C. traded on Nasdaq National Market, symbol ALLC. There are 6,152,703 total shares outstanding. Allied pays a regular quarterly cash distribution of 20 cents per share and an annual extra distribution which is determined at year end. Allied paid a total of $1.40 per share, including a 60 cent per share annual extra distribution in the form of shares of Allied Capital Lending Corp., for the year ended Dec. 31, 1994. Allied paid $1.35 per share in cash distributions for the year ended Dec. 31, 1993; $1.32 per share for 1992; $1.30 per share for 1991; $1.27 per share for 1990. Allied has paid regular quarterly distributions and an annual extra distribution since 1964. All numbers have been adjusted for stock splits. Allied's stock is marginable. A recent quote of the stock was $12.50. For additional information, please contact Allied Capital's Investor Relations Investor relations The process by which the corporation communicates with its investors. Department at 202/331-1112 or fax to 202/659-2053. CONTACT: Allied Capital, Washington Suzanne Suzanne is a common female given name that was particularly popular in the United States in the 1950s and 1960s. It remained in the top 200 most popular names in the United States between 1930 and the late 1980s. Sparrow, 202/331-1112 |
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