As of September 30, 2024, Ares Capital Corporation (ARCC) reported significant growth in its financial metrics compared to the previous fiscal period. Total assets increased to $27,100 million from $23,800 million as of December 31, 2023. The fair value of total investments rose to $25,918 million, up from $22,874 million, with non-controlled/non-affiliate company investments also seeing a notable increase to $21,458 million from $18,283 million.
Investment income for the three months ended September 30, 2024, reached $637 million, a substantial rise from $528 million in the same period of 2023. Interest income, excluding payment-in-kind interest, increased to $465 million from $401 million year-over-year. However, total expenses also rose to $402 million from $363 million, leading to net investment income before income taxes of $373 million, compared to $292 million in 2023. Net investment income for the quarter was $361 million, up from $289 million, while net unrealized gains decreased to $57 million from $287 million in the prior year.
The company’s total debt increased to $13,500 million from $11,884 million, while total stockholders’ equity rose to $12,773 million from $11,201 million. The net assets per share increased to $19.77 from $19.24. Despite the increase in net investment income, basic net income per common share fell to $0.62 from $0.89 in the previous year.
Ares Capital's investment strategy remains focused on first lien senior secured loans, with a significant portion of its portfolio in the software and services sector, which accounted for 25.4% of the fair value of investments. The company also reported a diversified portfolio across various sectors, including healthcare services and commercial services.
In terms of strategic developments, Ares Capital completed a $702 million term debt securitization in May 2024 and repaid $403 million in convertible notes in March 2024, resulting in a realized loss of $14 million. The company also amended its Revolving Funding Facility in October 2024, increasing commitments and extending the reinvestment period.
Overall, Ares Capital Corporation's performance reflects a robust growth trajectory in assets and income, despite challenges in net unrealized gains and a slight decline in per-share income metrics.
About ARES CAPITAL CORP
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