On August 7, 2024, Blue Owl Capital Corp III (OBDE, Financial) released its 8-K filing detailing its financial results for the second quarter ended June 30, 2024. Blue Owl Capital Corp III is focused on originating and making loans to, and debt and equity investments in middle-market companies based predominantly in the United States. Its objective is to generate current income and, to a lesser extent, capital appreciation by targeting investment opportunities with favorable risk-adjusted returns.
Performance Overview
Blue Owl Capital Corp III (OBDE, Financial) reported net investment income per share of $0.41, surpassing the analyst estimate of $0.40. The company's net asset value per share stood at $15.56. This performance is significant as it marks the company's first full quarter as a publicly traded entity, showcasing its ability to deploy capital effectively and generate substantial returns.
Financial Achievements
For the second quarter, Blue Owl Capital Corp III (OBDE, Financial) achieved a return on equity of 10.5%, reflecting its strategic capital deployment into attractive opportunities. The company declared a third-quarter dividend of $0.35 per share and a series of five special dividends of $0.06 per share, demonstrating its commitment to returning value to shareholders.
Investment and Portfolio Activity
During the quarter, OBDE made new investment commitments totaling $1.0 billion across 31 new and 24 existing portfolio companies, compared to $736.4 million in the previous quarter. The principal amount of new investments funded was $765.7 million, with $338.3 million in sales and repayments. As of June 30, 2024, OBDE had investments in 207 portfolio companies with an aggregate fair value of $4.3 billion.
| Metric | Q2 2024 | Q1 2024 | Q4 2023 |
|---|---|---|---|
| Investments at Fair Value | $4,346,302 | $3,987,997 | $3,590,701 |
| Total Assets | $4,502,757 | $4,180,538 | $3,761,097 |
| Net Asset Value Per Share | $15.56 | $15.65 | $15.56 |
| Investment Income | $123,175 | $113,445 | $111,542 |
| Net Investment Income | $50,381 | $48,275 | $71,647 |
| Net Income | $39,615 | $54,061 | $80,557 |
| Net Investment Income Per Share | $0.41 | $0.39 | $0.58 |
| Net Income Per Share | $0.32 | $0.44 | $0.66 |
Operational Insights
Investment income for the quarter increased to $123.2 million from $106.2 million in the same period last year, driven by higher interest income due to an expanded debt investment portfolio. However, total expenses also rose to $72.5 million from $36.3 million, primarily due to increased management fees, incentive fees, and interest expenses.
Liquidity and Capital Resources
As of June 30, 2024, OBDE had $120.3 million in cash, $2.5 billion in total principal value of debt outstanding, and $285.3 million of undrawn capacity on its credit facilities. The company's weighted average interest rate on debt outstanding was 7.1%, with a net debt to equity ratio of 1.22x.
Commentary and Future Outlook
“In our first full quarter as a publicly traded company, we continued to make significant progress towards growing our portfolio, deploying capital into attractive opportunities which enabled OBDE to deliver a strong return on equity of 10.5%,” commented Craig W. Packer, Chief Executive Officer.
Blue Owl Capital Corp III (OBDE, Financial) has demonstrated robust financial performance in its first full quarter as a public company, exceeding analyst expectations and showcasing its potential for future growth. Investors and stakeholders can look forward to continued strategic investments and value generation.
Explore the complete 8-K earnings release (here) from Blue Owl Capital Corp III for further details.
