TICC Announces Results of Operations for the Quarter Ended September 30, 2012 and Quarterly Distribution of $0.29 per share

GREENWICH, CT -- (Marketwire) -- 11/07/12 -- TICC Capital Corp. (NASDAQ: TICC) announced today its financial results for the quarter ended September 30, 2012 and a distribution of $0.29 per share for the fourth quarter of 2012.

HIGHLIGHTS

  • Total investment income for the third quarter of 2012 amounted to approximately $15.6 million, down approximately 23.8% from the second quarter of 2012 due largely to the non-recurrence of a one-time fee of $3.4 million earned during the second quarter of 2012 as well as lower interest income in the third quarter.

  • For the quarter ended September 30, 2012, we recorded net investment income of approximately $4.6 million, or approximately $0.12 per share on a GAAP basis. Excluding the impact of a capital gains incentive fee accrual, our core net investment income(1) was approximately $9.3 million, or approximately $0.24 per share. We also recorded net unrealized appreciation of approximately $21.5 million and net realized capital gains of approximately $1.8 million. In total, we had a net increase in net assets resulting from operations of approximately $27.9 million or $0.71 per share for the third quarter.

    • As of the end of the third quarter of 2012 we held one loan with a fair value of approximately $1.1 million on non-accrual status.
    • Our weighted average credit rating on a fair value basis was 2.2 at the end of the third quarter of 2012 (compared to 2.1 at the end of the second quarter of 2012).

  • Operating expenses before the capital gains incentive fee for the quarter ended September 30, 2012 were approximately $6.3 million, which was down from the second quarter of 2012 by approximately $200,000.

  • The reported capital gains incentive fee expense was approximately $4.6 million for the quarter ended September 30, 2012. The capital gains incentive fee expense, as reported under generally accepted accounting principles, is calculated on the basis of net realized and unrealized gains and losses at the end of each period. The expense related to the hypothetical liquidation of the portfolio (and assuming no other changes in realized or unrealized gains and losses) would only become payable to our investment adviser in the event of a complete liquidation of our portfolio as of period end and the termination of the Investment Advisory Agreement (the "Agreement") on such date. The $5.7 million capital gains incentive fee accrual as of September 30, 2012 relates entirely to this hypothetical liquidation calculation.

    The amount of the capital gains incentive fee which will actually be payable is determined in accordance with the terms of the Agreement and is calculated as of the end of each calendar year (or upon termination of the Agreement). The terms of the Agreement state that the capital gains incentive fee calculation is based on net realized gains, if any, offset by gross unrealized depreciation for the calendar year. No effect is given to gross unrealized appreciation in this calculation.

  • Our Board of Directors has declared a distribution of $0.29 per share for the fourth quarter of 2012.

    • Payable Date: December 31, 2012
    • Record Date: December 17, 2012

  • During the third quarter of 2012, we deployed approximately $128 million in additional investments. For the same period, we received proceeds of approximately $54.3 million from repayments, sales and amortization payments on our debt investments.

  • At September 30, 2012, the weighted average yield of our debt investments was approximately 10.3%, compared with 11.2% at June 30, 2012.

  • At September 30, 2012, net asset value per share was $9.85 compared with the net asset value per share at June 30, 2012 of $9.47.

  • On August 23, 2012, we closed a $160 million debt securitization transaction, consisting of $120 million of secured notes and $40 million in subordinated notes. The secured notes were issued in four classes. The class A-1 notes have an initial face amount of $88 million, are rated AAA(sf)/Aaa(sf) by Standard & Poor's Ratings Services (S&P) and Moody's Investors Service, Inc. (Moody's), respectively, and bear interest at three-month LIBOR plus 1.75%. The class B-1 notes have an initial face amount of $10 million, are rated AA(sf)/Aa2(sf) by S&P and Moody's, respectively, and bear interest at three-month LIBOR plus 3.50%. The class C-1 notes have an initial face amount of $11.5 million, are rated A(sf)/A2(sf) by S&P and Moody's, respectively, and bear interest at three-month LIBOR plus 4.75%. The class D-1 notes have an initial face amount of $10.5 million, are rated BBB(sf)/Baa2(sf) by S&P and Moody's, respectively, and bear interest at three-month LIBOR plus 5.75%. TICC presently owns all of the subordinated notes and $3.0 million of the class D-1 notes issued in the CLO transaction. The secured notes have a stated maturity date of August 25, 2023 and are subject to a two year non-call period. The CLO has a four year reinvestment period.

  • On September 26, 2012, we closed a private placement of 5-year unsecured 7.50% Senior Convertible Notes Due 2017 (the "Notes"). A total of $105 million aggregate principal amount of the Notes were issued at the closing.

    • The Notes are convertible into shares of our common stock based on an initial conversion rate of 87.2448 shares of our common stock per $1,000 principal amount of Notes, which is equivalent to an initial conversion price of approximately $11.46 per share of common stock, representing an approximately 10.0% conversion premium over the last reported sale price of our common stock at the time of issuance on September 20, 2012, which was $10.42 per share. The conversion price for the Notes will be reduced for quarterly cash dividends paid to common shares to the extent that the quarterly dividend exceeds $0.29 per share, subject to adjustment.

    • The Notes bear interest at an annual rate of 7.50%, payable semiannually in arrears on May 1 and November 1 of each year, beginning May 1, 2013. The Notes will mature on November 1, 2017, unless previously converted in accordance with their terms. The Notes are general unsecured obligations of TICC, rank equally in right of payment with TICC's future senior unsecured debt, and will rank senior in right of payment to any potential subordinated debt, should any be issued in the future.

  • On October 22, 2012, we announced that we issued an additional $10 million aggregate principal amount of the Notes pursuant to the exercise of the initial purchasers' option.


(1)Supplemental Information Regarding Core Net Investment Income and Core Net Increase in Net Assets Resulting from Operations

On a supplemental basis, we provide information relating to core net investment income and core net increase in net assets resulting from operations, non-GAAP measures. These measures are provided in addition to, but not a substitute for, net investment income and net increase in net assets resulting from operations. Core net investment income represents net investment income excluding our capital gains incentive fee. Core net increase in net assets resulting from operations represents net increase in net assets resulting from operations excluding the capital gains incentive fee. As the capital gains incentive fee is based on a hypothetical event that did not occur, we believe that core net investment income and core net increase in net assets resulting from operations are useful indicators of non- hypothetical transactions during this period.

The following table provides a reconciliation of net investment income to core net investment income (for the three and nine months ended September 30, 2012):



                                Three Months Ended      Nine Months Ended
                                September 30, 2012      September 30, 2012
                             ----------------------- -----------------------
                                          Per Share               Per Share
                                Amount     Amounts      Amount     Amounts
                             ----------- ----------- ----------- -----------
Net investment income        $ 4,607,574 $     0.117 $27,799,570 $     0.754
Capital gains incentive fee    4,649,814 $     0.118   4,559,957 $     0.124
                             ----------- ----------- ----------- -----------
Core net investment income   $ 9,257,388 $     0.235 $32,359,527 $     0.878
                             =========== =========== =========== ===========


We will host a conference call to discuss our third quarter results on Wednesday, November 7 at 10:00 AM ET. Please call 1-877-317-6789 to participate. A replay of the conference call will be available for approximately 30 days. The replay number is 1-877-344-7529, and the replay passcode is 10020948.

The following financial statements are unaudited and without footnotes. Readers who would like additional information should obtain our Form 10-K for the period ended December 31, 2011, and subsequent reports on Form 10-Q as they are filed.



TICC CAPITAL CORP.
CONSOLIDATED STATEMENTS OF ASSETS AND LIABILITIES (UNAUDITED)


                                              September 30,   December 31,
                                                  2012            2011
                                             --------------  --------------

ASSETS

  Non-affiliated/non-control investments
   (cost: $495,670,473 @ 9/30/12;
   $372,091,255 @ 12/31/11)                  $  521,247,939  $  375,793,839
  Control investments (cost: $17,239,639 @
   9/30/12; $17,434,371 @ 12/31/11)              16,450,000      15,675,000
                                             --------------  --------------
    Total investments at fair value             537,697,939     391,468,839
                                             --------------  --------------
  Cash and cash equivalents                     122,905,470       4,494,793
  Restricted cash                                96,729,990      23,183,698
  Deferred debt issuance costs                    8,182,726       2,895,873
  Interest and distributions receivable           4,497,012       1,837,882
  Securities sold not settled                       503,750               -
  Other assets                                      102,138         238,485
                                             --------------  --------------
       Total assets                          $  770,619,025  $  424,119,570
                                             ==============  ==============

LIABILITIES
  Notes payable - TICC CLO LLC, net of
   discount                                  $   99,842,691  $   99,710,826
  Notes payable - TICC CLO 2012-1 LLC, net
   of discount                                  112,600,474               -
  Convertible senior notes payable              105,000,000               -
  Accrued interest payable                        1,027,631       1,076,113
  Investment advisory fee payable to
   affiliate                                      3,800,311       2,895,799
  Accrued capital gains incentive fee to
   affiliate                                      5,668,706       1,108,749
  Securities purchased not settled               34,561,217      13,352,500
  Accrued expenses                                1,220,546         873,592
                                             --------------  --------------
     Total liabilities                          363,721,576     119,017,579
                                             --------------  --------------

NET ASSETS
  Common stock, $0.01 par value, 100,000,000
   shares authorized, and 41,312,780 and
   32,818,428 issued and outstanding,
   respectively                                     413,128         328,184
  Capital in excess of par value                452,280,904     376,991,540
  Net unrealized appreciation on investments     24,787,827       1,943,213
  Accumulated net realized losses on
   investments                                  (66,752,406)    (70,308,108)
  Distributions in excess of investment
   income                                        (3,832,004)     (3,852,838)
                                             --------------  --------------
    Total net assets                            406,897,449     305,101,991
                                             --------------  --------------
    Total liabilities and net assets         $  770,619,025  $  424,119,570
                                             ==============  ==============
Net asset value per common share             $         9.85  $         9.30




TICC CAPITAL CORP.
CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)


                       Three Months Three Months   Nine Months  Nine Months
                           Ended        Ended         Ended        Ended
                         September    September     September    September
                         30, 2012     30, 2011      30, 2012     30, 2011
                       ------------ ------------  ------------ ------------

INVESTMENT INCOME
From non-
 affiliated/non-
 control investments:
  Interest income -
   debt investments    $  8,908,966 $  7,435,546  $ 27,159,248 $ 21,198,270
  Distributions from
   securitization
   vehicles and equity
   investments            6,025,634    3,196,002    17,919,415    9,079,259
  Commitment,
   amendment fee
   income and other
   income                   278,613       60,953     4,524,825      506,972
                       ------------ ------------  ------------ ------------
    Total investment
     income from non-
     affiliated/non-
     control
     investments         15,213,213   10,692,501    49,603,488   30,784,501
                       ------------ ------------  ------------ ------------
From control
 investments:
  Interest income -
   debt investments         377,401      392,449     1,136,010    1,194,871
  Distributions from
   equity investments             -            -        62,041            -
                       ------------ ------------  ------------ ------------
  Total investment
   income from control
   investments              377,401      392,449     1,198,051    1,194,871
                       ------------ ------------  ------------ ------------
    Total investment
     income              15,590,614   11,084,950    50,801,539   31,979,372
                       ------------ ------------  ------------ ------------
EXPENSES
  Compensation expense      289,361      217,639       839,049      713,491
  Investment advisory
   fees                   2,796,873    1,942,657     7,390,894    5,218,773
  Professional fees         420,696      386,087     1,647,733      847,301
  Interest expense and
   other debt
   financing expenses     1,398,975      434,283     3,052,056      434,283
  General and
   administrative           423,884      185,833     1,151,363      760,576
                       ------------ ------------  ------------ ------------
    Total expenses
     before incentive
     fees                 5,329,789    3,166,499    14,081,095    7,974,424
                       ------------ ------------  ------------ ------------
  Net investment
   income incentive
   fees                   1,003,437      455,864     4,360,917    1,444,415
  Capital gains
   incentive fees         4,649,814   (4,153,198)    4,559,957      873,288
                       ------------ ------------  ------------ ------------
    Total incentive
     fees                 5,653,251   (3,697,334)    8,920,874    2,317,703
                       ------------ ------------  ------------ ------------
    Total expenses       10,983,040     (530,835)   23,001,969   10,292,127
                       ------------ ------------  ------------ ------------
Net investment income     4,607,574   11,615,785    27,799,570   21,687,245
                       ------------ ------------  ------------ ------------
Net change in
 unrealized
 (depreciation)
 appreciation on
 investments             21,471,506  (20,114,242)   22,844,614  (17,051,762)
                       ------------ ------------  ------------ ------------
Net realized gains on
 investments              1,777,564       83,178     3,555,702    2,713,526
                       ------------ ------------  ------------ ------------
Net increase in net
 assets resulting from
 operations            $ 27,856,644 $ (8,415,279) $ 54,199,886 $  7,349,009
                       ============ ============  ============ ============

Net increase in net
 assets resulting from
 net investment income
 per common share:
      Basic            $       0.12 $       0.36  $       0.75 $       0.67
      Diluted          $       0.12 $       0.36  $       0.75 $       0.67
Net increase in net
 assets resulting from
 operations per common
 share:
      Basic            $       0.71 $      (0.26) $       1.47 $       0.23
      Diluted          $       0.69 $      (0.26) $       1.45 $       0.23
Weighted average
 shares of common
 stock outstanding:
      Basic              39,383,076   32,672,294    36,859,005   32,327,163
      Diluted            40,777,815   32,672,294    37,327,312   32,327,163




TICC CAPITAL CORP.
FINANCIAL HIGHLIGHTS (UNAUDITED)


                          Three        Three
                          Months       Months     Nine Months  Nine Months
                          Ended        Ended         Ended        Ended
                        September    September     September    September
                         30, 2012     30, 2011      30, 2012     30, 2011
                       (unaudited)  (unaudited)   (unaudited)  (unaudited)
                       -----------  -----------   -----------  -----------

Per Share Data
----------------------
Net asset value at
 beginning of period   $      9.47  $      9.85   $      9.30  $      9.85
                       -----------  -----------   -----------  -----------

Net investment
 income(1)                    0.12         0.36          0.75         0.67
Net realized and
 unrealized capital
 gains                        0.59        (0.62)         0.72        (0.44)
                       -----------  -----------   -----------  -----------

Total from net
 investment operations        0.71        (0.26)         1.47         0.23
                       -----------  -----------   -----------  -----------

Distributions per
 share from net
 investment income           (0.29)       (0.25)        (0.83)       (0.74)

Distributions based on
 weighted average
 share impact                (0.03)           -         (0.08)           -

Distributions from net
 realized capital
 gains                           -            -             -            -

Tax return of capital
 distributions                   -            -             -            -
                       -----------  -----------   -----------  -----------

Total distributions(2)       (0.32)       (0.25)        (0.91)       (0.74)
                       -----------  -----------   -----------  -----------

Effect of shares
 issued, net of
 offering expenses           (0.01)           -         (0.01)           -
                       -----------  -----------   -----------  -----------

Net asset value at end
 of period             $      9.85  $      9.34   $      9.85  $      9.34
                       ===========  ===========   ===========  ===========

Per share market value
 at beginning of
 period                $      9.69  $      9.60   $      8.65  $     11.21
Per share market value
 at end of period      $     10.40  $      8.17   $     10.40  $      8.17
Total return(3)              10.32%      (12.29%)       30.55%      (21.23%)
Shares outstanding at
 end of period          41,312,780   32,745,881    41,312,780   32,745,881
Ratios/Supplemental
 Data
----------------------
Net assets at end of
 period (000's)            406,897      305,801       406,897      305,801
Average net assets
 (000's)                   374,696      326,988       349,297      321,174
Ratio of expenses to
 average net assets:
  Expenses before
   incentive fees(4)          5.69%        3.87%         5.37%        3.31%
  Net investment
   income incentive
   fees(4)                    1.07%        0.56%         1.67%        0.60%
  Capital gains
   incentive fees(4)          4.96%       (5.08)%        1.74%        0.36%
                       -----------  -----------   -----------  -----------

Total ratio of
 expenses to average
 net assets(4)               11.72%       (0.65%)        8.78%        4.27%
                       ===========  ===========   ===========  ===========

Ratio of expenses,
 excluding interest
 expense, to average
 net assets(4)               10.23%       (1.18)%        7.62%        4.09%

Ratio of net
 investment income to
 average net assets(4)        4.92%       14.21%        10.61%        9.00%


(1) Represents per share net investment income for the period, based upon average shares outstanding.

(2) 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 tax character of distributions will be determined at the end of the fiscal year. However, if the character of such distributions were determined as of September 30, 2012, none of the distributions for 2012 would have been characterized as a tax return of capital to the Company's stockholders; this tax return of capital may differ from the return of capital calculated with reference to net investment income for financial reporting purposes.

(3) Total return equals the increase or decrease of ending market value over beginning market value, plus distributions, divided by the beginning market value, assuming dividend reinvestment prices obtained under the Company's dividend reinvestment plan. Total return is not annualized.

(4) Annualized.

About TICC Capital Corp.
TICC Capital Corp. is a publicly-traded business development company principally engaged in providing capital to established small and mid-size companies, investing in syndicated bank loans and purchasing debt and equity tranches of collateralized loan obligations. Companies interested in learning more about financing opportunities should contact Debdeep Maji at (203) 983-5285.

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. 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.

Contacts:
Bruce Rubin
203-983-5280


Patrick Conroy
203-983-5282