Exhibit 99.1
Gladstone Investment Corporation Reports Financial Results
for the Three Months Ended September 30, 2005
MCLEAN, Va.--(BUSINESS WIRE)--Nov. 9, 2005--Gladstone Investment Corp.
(NASDAQ:GAIN) (the "Company") today announced earnings for the three months
ended September 30, 2005 and for the period June 22, 2005 (commencement of
operations) to September 30, 2005.
Net Investment Income for the quarter ended September 30, 2005 was
$1,412,906 or $0.09 per basic and diluted weighted average common share
outstanding and $1,432,706 or $0.09 per basic and diluted weighted average
common share outstanding for the period of June 22, 2005 (commencement of
operations) to September 30, 2005.
Unless otherwise noted, all per share references are per basic and diluted
weighted average common share outstanding.
Net Increase in Net Assets Resulting from Operations for the three months
ended September 30, 2005 was $1,476,732 or $0.09 per share. The Net Increase in
Net Assets Resulting from Operations for the period June 22, 2005 (commencement
of operations) to September 30, 2005 was $1,496,532 or $0.09 per share.
The Company also recorded net unrealized appreciation on its investments of
$63,826 for the three months ended September 30, 2005 and for the period June
22, 2005 (commencement of operations) to September 30, 2005.
Total assets were $230,961,222 at September 30, 2005. Net asset value was
$230,753,412 or $13.93 per actual common share outstanding at September 30,
2005.
During the three months ended September 30, 2005 and for the period June
22, 2005 (commencement of operations) to September 30, 2005, the Company
recorded the following activity:
-- New loans of approximately $40.5 million to eight companies, net of
principal repayments
At September 30, 2005, the Company had investments in debt securities in
eight private companies having an aggregate cost balance of approximately $40.5
million and a fair value of approximately $40.6 million.
Subsequent to September 30, 2005, the Company purchased an additional $5.0
million of loan participations.
Results reported today for investment income and operating expenses are not
expected to be indicative of future operating performance. In particular, the
Company expects investment income to increase in future periods, as compared to
the three months ended September 30, 2005 and the period June 22, 2005
(commencement of operations) to September 30, 2005, as a result of the
investment of the net proceeds from the initial public offering and as
investments are made in portfolio company securities that the Company expects
will yield a greater return than the cash and cash equivalents in which the vast
majority of the net proceeds of the Company's initial public offering are
currently invested.
"We have seen a significant increase in opportunities presented to us,
since the fund was launched in June. We believe that our investment activity is
ramping up yielding positive results for our shareholders through monthly
dividend payments," said Chip Stelljes, President and Chief Investment Officer.
In October, the Company announced that the Board of Directors had declared
its cash dividends of $0.04 per common share for each of the months of October,
November and December 2005. This represents a 100% increase in the monthly
dividend of $0.02 per common share paid for the months of July, August and
September 2005.
Gladstone Investment will have a conference call at 9:30 am EDT, November
10, 2005. To enter the call please dial (866) 814-1914 and use the confirmation
code 799205. An operator will monitor the call and set a queue for questions. To
hear the replay of the call please dial (888) 266-2081 and use the confirmation
code 799205. The conference call will also be broadcast on the internet through
a link on Gladstone Investment's web site and www.InvestorCalendar.com.
Gladstone Investment Corporation is an investment company that seeks to
make debt and equity investments in small and mid-sized private businesses in
the U.S. in connection with acquisitions, changes in control and
recapitalizations. For more information please visit our website at
http://www.GladstoneInvestment.com.
For further information contact our Investor Relations Manager, Kelly
Sargent at 703-287-5835.
This press release may include statements that may constitute
"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, including statements with regard to the future performance of the
Company. Words such as "believes," "expects," "anticipates," "estimated,"
"approximately" "projects" and "future" or similar expressions are intended to
identify forward-looking statements. These forward-looking statements inherently
involve certain risks and uncertainties, although they are based on the
Company's current plans that are believed to be reasonable as of the date of
this press release. Factors that may cause the Company's actual results, levels
of activity, performance or achievements to be materially different from any
future results, levels of activity, performance or achievements expressed or
implied by such forward-looking statements include, among others, those factors
listed under the caption "Risk factors" of the Company's prospectus dated June
22, 2005, as filed with the Securities and Exchange Commission on June 23, 2005.
The Company undertakes no obligation to publicly update or revise any
forward-looking statements, whether as a result of new information, future
events or otherwise.
GLADSTONE INVESTMENT CORPORATION
STATEMENT OF ASSETS AND LIABILITIES
(UNAUDITED)
September 30, March 31,
2005 2005
------------- -------------
ASSETS
Cash $ 6,132,099 $ 3,636
Investments at fair value (Cost 9/30/2005:
$40,507,884) 40,571,710 -
Cash equivalents 183,841,923 -
Interest receivable 106,434 -
Prepaid insurance 211,450 -
Prepaid directors fees 84,000 -
Deferred offering costs - 47,864
Other assets 13,606 -
------------- -------------
TOTAL ASSETS $230,961,222 $ 51,500
============= =============
LIABILITIES
Accounts payable $ 32,071 $ -
Administration fee payable to Gladstone
Administration 77,962 -
Base management fee payable to Gladstone
Management 67,434 -
Loan payable to affiliate - 50,000
Accrued expenses 30,343 -
------------- -------------
Total Liabilities 207,810 50,000
------------- -------------
NET ASSETS $230,753,412 $ 1,500
============= =============
ANALYSIS OF NET ASSETS:
Common stock, $0.001 par value, 100,000,000
shares authorized and 16,560,100 and 100
shares issued and outstanding,
respectively $ 16,560 $ -
Capital in excess of par value 230,233,926 1,500
Net unrealized appreciation of investment
portfolio 63,826 -
Undistributed net investment income 439,100 -
------------- -------------
Total Net Assets $230,753,412 $ 1,500
============= =============
Net assets per share $ 13.93 $ 15.00
============= =============
GLADSTONE INVESTMENT CORPORATION
STATEMENT OF OPERATIONS
(UNAUDITED)
For the period
June 22, 2005
For the three (Commencement of
months ended Operations) to
September 30, 2005 September 30, 2005
------------------ ------------------
INVESTMENT INCOME
Interest income - investments $ 193,578 $ 193,578
Interest income - cash and cash
equivalents 1,613,012 1,661,210
------------------ ------------------
Total investment income 1,806,590 1,854,788
------------------ ------------------
EXPENSES
Administration fee to
Gladstone Administration 77,962 105,045
Base management fee to
Gladstone Management 92,108 92,108
Directors fees 52,000 52,000
Insurance 42,478 42,478
Organizational costs 7,002 7,002
Professional fees 66,302 66,302
Stockholder related costs 42,903 43,538
Interest - 378
General and administrative 12,929 13,231
------------------ ------------------
Total expenses 393,684 422,082
------------------ ------------------
NET INVESTMENT INCOME 1,412,906 1,432,706
------------------ ------------------
Unrealized appreciation of
investment portfolio 63,826 63,826
NET INCREASE IN NET ASSETS
RESULTING FROM OPERATIONS
(Refer to Note 5) $ 1,476,732 $ 1,496,532
================== ==================
NET INCREASE IN NET ASSETS
RESULTING FROM OPERATIONS PER
COMMON SHARE:
Basic and Diluted $ 0.09 $ 0.09
================== ==================
SHARES OF COMMON STOCK
OUTSTANDING:
Basic and diluted weighted
average shares 16,231,404 16,084,900
GLADSTONE INVESTMENT CORPORATION
FINANCIAL HIGHLIGHTS
(UNAUDITED)
For the period
June 22, 2005
For the three (Commencement of
months ended Operations) to
September 30, 2005 September 30, 2005
------------------ ------------------
Per Share Data (1)
- ------------------
Net proceeds from initial public
offering (2) $ 13.90 $ 13.95
------------------ ------------------
Offering costs - (0.05)
Income from investment
operations:
Net investment income 0.09 0.09
------------------ ------------------
Total from investment operations 0.09 0.09
------------------ ------------------
Distributions (0.06) (0.06)
------------------ ------------------
Net asset value at end of period $ 13.93 $ 13.93
================== ==================
Per share market value at
beginning of period $ 15.05 $ 15.00
Per share market value at end of
period 14.68 14.68
Total Return (3) (4) -2.07% -1.74%
Shares outstanding at end of
period 16,560,100 16,560,100
Ratios/Supplemental Data
- ------------------------
Net assets at end of period $ 230,753,412 $ 230,753,412
Average net assets (5) $ 230,242,643 $ 222,716,478
Ratio of expenses to average net
assets-annualized 0.68% 0.57%
Ratio of net investment income to
average net assets-annualized 2.45% 1.93%
(1) Based on actual shares outstanding.
(2) Net of initial underwriting discount of $1.05 per share.
(3) Total return equals the increase of the ending market value over
the beginning market value divided by the market value at the
beginning of each month.
(4) Amounts are not annualized.
(5) Average net assets calculated from June 22, 2005 (commencement of
operations) to September 30, 2005 for the period June 22, 2005
(commencement of operations) to September 30, 2005.
CONTACT: Gladstone Investment Corporation
Kelly Sargent, 703-287-5835