13/05/2008 23:04
PR Newswire
ST. PETER PORT, Guernsey, May 13 /PRNewswire/ --
European Capital Limited ("European Capital") (LSE: ECAS) announced today its second quarter 2008 dividend and its results for the first quarter of 2008.
SECOND QUARTER 2008 DIVIDEND DECLARATION
European Capital's Board of Directors has declared a second quarter 2008 dividend of euro 0.15 per share to record holders as of 27 June 2008, payable on 25 July 2008. This is a 50% increase over the second quarter 2007 dividend of euro 0.10 per share and is in line with the dividend guidance announced at the time of its results announcement for 2007. European Capital has now paid or declared a total of euro 72.6 million in dividends since its May 2007 initial public offering ("IPO").
2008 DIVIDEND GUIDANCE
European Capital reiterates its 2008 dividend forecast of euro 0.62 per share, a 68% growth over post-IPO 2007 dividends of euro 0.37 per share. The remaining 2008 dividends per share are forecast to be in the following quarterly amounts.
euro 0.16 for Q3 2008, 23% increase over Q3 2007; and
euro 0.16 for Q4 2008, 14% increase over Q4 2007.
FIRST QUARTER 2008 RESULTS
Net Operating Income (NOI) European Capital also announced today its results for the first quarter of 2008. NOI for the quarter increased 4% to euro 0.24 per share, compared to euro 0.23 per share for the first quarter of 2007.
Realised Earnings
Realised Earnings increased 19% to euro 0.32 per share for the first quarter of 2008, compared to euro 0.27 per share for the first quarter of 2007. Realised Earnings return on equity at cost for the twelve months to the first quarter of 2008 was 11%. Realised Earnings for the first quarter 2008 covered 213% of the euro 0.15 per share dividend for the first quarter 2008.
Earnings
European Capital's Earnings for the first quarter of 2008 was a loss of euro 1.49 per share, a decrease of euro 1.85 per share from the first quarter of 2007 Earnings of euro 0.36 per share. Earnings return on equity for the twelve months to the first quarter of 2008 was (13)%. This loss was due to euro 165 million of unrealised depreciation during the first quarter of 2008. During the first quarter, European Capital implemented Statement of Financial Accounting Standard No. 157, Fair Value Measurements, ("SFAS 157"), new principles-based guidance to US generally accepted accounting practices ("GAAP"), which caused certain changes to the methodologies used in valuing the Company's investments.
European Capital's net asset value ("NAV") per share at 31 March 2008 was euro 8.03, a decrease of euro 1.64 or 17% lower than the 31 December 2007 NAV per share of euro 9.67.
"We delivered excellent NOI and Realised Earnings for the quarter." said Malon Wilkus, Chairman of the Board. "The substantial decline in our Earnings is due to euro 165 million of unrealised depreciation, which we believe will have little impact on our future revenues, NOI and Realised Earnings. This depreciation was driven by declining trading prices, the continued widening of investment spreads and our adoption of SFAS 157. We believe that with the adoption of SFAS 157, investors will need to focus on both reported US GAAP fair values as well as values that we anticipate realising on settlement or maturity of our investments ("Realisable Value"). In the future, we intend to report the anticipated Realisable Values on settlement or maturity of our investments as well as US GAAP values so investors can consider both."
For the first quarter of 2008, net appreciation, depreciation, gains and losses totalled euro (187) million consisting of euro 9 million of net realised gains less euro 196 million of net depreciation, compared to euro 10 million of net appreciation, depreciation, gains and losses for the first quarter of 2007. The primary components of the euro 196 million of net depreciation for the quarter were as follows:
-- euro 102 million of depreciation associated with the adoption of SFAS 157, including the widening of investment spreads;
-- euro 51 million of depreciation associated with the write down of Private Finance investments;
-- euro 10 million of depreciation from its Structured Products, due to the continuing widening of investment spreads;
-- euro 21 million of net depreciation from foreign currency translation;
-- euro 10 million of reversals of prior foreign currency appreciation associated with realised gains; and
-- euro 2 million of net depreciation on derivatives. "Credit quality remains good in light of the economic environment," stated John Erickson, Director of European Capital Financial Services (Guernsey) Limited. "Most of the depreciation this quarter was not as a result of weakening credit as non-accruing loans at fair value remained within a reasonable level of 0.3% of total loans at fair value. While the European economy may be slowing, we believe we are in the later stages of the liquidity crisis. We are seeing bids for some assets starting to tighten in the second quarter and today it looks like March may have been the low point for wide spreads and asset depreciation though we will need to see the trend continue in order to know for certain."
In the first quarter of 2008, European Capital invested euro 168 million and received euro 115 million of proceeds from realisations of portfolio investments.
As of 31 March 2008, loans with a fair value of euro 4 million were on non-accrual representing 0.3% of total loans at fair value as of 31 March 2008, compared to no non-accrual loans at fair value as of 31 December 2007.
"M? volumes declined in the first quarter but high quality companies continue to come to market even in this somewhat tighter lending environment," said Ira Wagner, President of European Capital Financial Services Limited ("ECFS"). "However, debt capital continues to be available for middle market transactions. As the M? market reflects slower world growth and a U.S. recession, we believe there will be great opportunities for our UK and continental European One-Stop Buyouts."
Since inception, European Capital has earned a 15% compounded annual return, including interest, dividends, fees and net gains, on 29 realisations of senior debt, subordinated debt and equity investments, totalling euro 1.2 billion of committed capital. These realisations represent 35% of all amounts invested by European Capital since inception.
"Over the past several months, numerous firms have been forced to issue dilutive equity in order to fix their balance sheets," stated Tom McHale, Director, ECFS. "We have continued to have access to the capital markets, most recently issuing euro 267 million of AAA-rated secured floating rate notes, backed by euro 486 million in loans originated by European Capital. This was one of the few asset securitisations completed on European markets this year and we are pleased to have been able to arrange this financing given the current liquidity crunch."
During the first quarter, European Capital was also required to adopt Statement of Financial Accounting Standard No. 159, The Fair Value Option for Financial Assets and Financial Liabilities, which gave the Company the option to fair value its financial liabilities in its financial statements. European Capital did not elect the fair value option for any of its eligible financial liabilities. However, European Capital will begin providing its shareholders with supplemental information on the fair value of its financial liabilities. The cost basis and fair value of European Capital's financial liabilities as of 31 March 2008 were euro 949 million and euro 918 million, respectively, or a positive difference of euro 31 million.
MATERIAL DIFFERENCES BETWEEN FAIR VALUE AND REALISABLE VALUE European Capital believes that approximately euro 110 million of the depreciation reflected in the results of this and prior quarters will ultimately be reversed when it exits the investments. European Capital invests primarily in illiquid assets, which are referred to in SFAS 157 as level 3 assets, with the intention to hold the assets to settlement or maturity. This is in contrast to the premise under US GAAP that assets generally should be valued on the basis of their current market value and, if no or limited market exists, on a hypothetical market value. European Capital has not historically sold its investment assets on a market. Instead it has typically settled its private finance investments at the time of a change of control transaction, such as through a sale or recapitalisation of its portfolio companies.
The current lack of liquidity in the financial markets has caused investment spreads between the cost of funds and investment income to widen dramatically on investments, which in most cases results in current fair values that are materially lower than the Company anticipates realising on settlement or maturity.
The Company is following US Regulatory Disclosures regarding SFAS 157 that allows it to disclose material differences between US GAAP fair value and values anticipated to be realised upon settlement or maturity (Realisable Value). Because European Capital believes its US GAAP fair values diverge materially from the amounts it anticipates to realise on settlement or maturity, the Company will begin to provide pro forma information on the Realisable Value of its assets in comparison to the fair value determined under US GAAP.
The following table summarises the current cost basis and fair value of our investments as of 31 March 2008 and the amount we currently anticipate realising on settlement or maturity:
Difference
Between
Realisable
Value and
Net US GAAP
Asset Cost Net Apprec./ Currency Fair Value Realisable Fair
Class Basis (Deprec.) Movement US GAAP Value(1) Value
(euro) (euro) (euro) (euro) (euro) (euro)
Private
Finance 1,995 (145) (109) 1,741 1,841 100
Structured
Product 24 (10) - 14 24 10
Derivatives 1 (1) 8 8 8 -
Total 2,020 (156) (101) 1,763 1,873 110
(1) Realisable Value is a non-GAAP financial measure that is the future
value that we anticipate realising on the settlement or maturity of
our investments.
THIRD PARTY VALUATION OF PORTFOLIO INVESTMENTSEuropean Capital's Board of Directors is responsible for determining the fair value of European Capital's portfolio investments on a quarterly basis. In that regard, the Board retains Houlihan Lokey Howard & Zukin Financial Advisors Inc. ("Houlihan Lokey") to assist it by having Houlihan Lokey regularly review a designated percentage of fair value determinations. Houlihan Lokey is a leading valuation firm engaged in over 1,000 valuation assignments per year for clients worldwide. Each quarter, Houlihan Lokey reviews approximately one quarter of European Capital's determination of the fair value of its portfolio company investments that have been portfolio companies for at least one year and that have a fair value in excess of euro 10 million, in accordance with European Capital's valuation procedures. In the first quarter of 2008, Houlihan Lokey reviewed valuations of 23 portfolio company investments having an aggregate euro 781 million in fair value as of the period end. In addition, Houlihan Lokey representatives attend European Capital's quarterly valuation meetings and provide quarterly reports and recommendations to the Audit Committee of the Board of Directors.
For those portfolio company investments that Houlihan Lokey has reviewed during each applicable period, using the scope of review set forth by European Capital's Board of Directors and in accordance with European Capital's valuation procedures, the Board has made a fair value determination that is within the aggregate range of fair value for such investments as determined by Houlihan Lokey.
Financial highlights for the quarter are as follows:
EUROPEAN CAPITAL LIMITED
CONSOLIDATED BALANCE SHEETS
As of 31 March 2008 and 31 December 2007
(in thousands, except per share data)
31 March 2008
31 March 31 December Versus
2008 2007 31 December 2007
(unaudited)
euro euro euro %
Assets
Investments at fair value (Cost
basis of euro 2,020,116 and
euro 1,968,468, respectively) 1,762,681 1,925,696 (163,015) -8%
Cash and cash equivalents 39,741 2,575 37,166 NM
Restricted cash 20,082 30,214 (10,132) -34%
Other 19,699 9,558 10,141 106%
Total assets 1,842,203 1,968,043 (125,840) -6%
Liabilities and Shareholders'
Equity
Debt (maturing within one year
euro 582,114 and euro 793,237,
respectively) 948,582 896,157 52,425 6%
Due to European Capital
Financial Services (Guernsey)
Limited 3,616 718 2,898 404%
Accrued dividends payable 16,255 15,171 1,084 7%
Other 3,666 8,377 (4,711) -56%
Total liabilities 972,119 920,423 51,696 6%
Commitments and contingencies
Shareholders' equity:
Ordinary shares (nil par
value, authorised to issue
unlimited number of shares,
108,364 issued and
outstanding, 2007: 108,364) - 1,030,888 (1,030,888) -100%
Other reserve 1,030,888 - 1,030,888 NM
Undistributed net realised
earnings 55,614 37,235 18,379 49%
Net foreign currency
(depreciation) appreciation (59,823) (28,391) (31,432) -111%
Net (depreciation)
appreciation of investments (156,595) 7,888 (164,483) NM
Total shareholders' equity 870,084 1,047,620 (177,536) -17%
Total liabilities and
shareholders' equity 1,842,203 1,968,043 (125,840) -6%
NM = Not Meaningful
EUROPEAN CAPITAL LIMITED
CONSOLIDATED STATEMENTS OF OPERATIONS
Three Months Ended 31 March 2008 and 2007
(in thousands, except
per share data)
Three Months Ended Three Months Ended
31 March 31 March
2008 2007 2008 Versus 2007
(unaudited)(unaudited)
euro euro euro %
OPERATING INCOME:
Interest and dividend income 53,447 34,282 19,165 56%
Fee and other income 320 3,290 (2,970) -90%
Total operating income 53,767 37,572 16,195 43%
OPERATING EXPENSES:
Interest 16,029 6,940 9,089 131%
Management fee and reimbursed
expenses 9,421 11,366 (1,945) -17%
Incentive fee - - - -
General and administrative 2,152 1,530 622 41%
Total operating expenses 27,602 19,836 7,766 39%
OPERATING INCOME BEFORE INCOME TAXES 26,165 17,736 8,429 48%
Provision for income taxes (81) (144) 63 -44%
NET OPERATING INCOME 26,084 17,592 8,492 48%
Net foreign currency gains 8,576 2,286 6,290 275%
Net loss on investments (26) - (26) NM
TOTAL NET REALISED EARNINGS 34,634 19,878 14,756 74%
Net foreign currency depreciation (31,432) (3,782) (27,650) -731%
Net (depreciation) appreciation of
investments (164,483) 11,013 (175,496) NM
(DECREASE) INCREASE IN NET ASSETS
RESULTING FROM OPERATIONS
("EARNINGS") (161,281) 27,109 (188,390) -695%
NET OPERATING INCOME PER SHARE:
Basic & Diluted 0.24 0.23 0.01 4%
NET REALISED EARNINGS PER SHARE:
Basic & Diluted 0.32 0.27 0.05 19%
NET EARNINGS PER SHARE:
Basic & Diluted (1.49) 0.36 (1.85) -514%
WEIGHTED AVERAGE NUMBER OF SHARES
OUTSTANDING:
Basic 108,364 75,000 33,364 44%
Diluted 108,364 75,714 32,650 43%
DIVIDENDS DECLARED PER SHARE 0.15 0.21 (0.06) -29%
NM = Not Meaningful
EUROPEAN CAPITAL LIMITED
OTHER FINANCIAL INFORMATION
Three Months Ended 31 March 2008, 31 December 2007 and 31 March 2007
(in thousands, except per share data)
(unaudited)
Q1 Q4 Q1 2008 Versus
2008 2007 Q4 2007
euro euro euro %
New Investments:
Senior Debt 1,035 25,000 (23,965) -96%
Subordinated Debt 164,037 149,937 14,100 9%
Preferred Equity 3,072 3,263 (191) -6%
Common Equity 115 1,775 (1,660) -94%
CDO/CLO Investments - - - NM
Total 168,259 179,975 (11,716) -7%
European Capital
Sponsored Buyouts - - 0 100%
Financing for Sponsored
Buyouts 152,949 178,625 (25,676) -14%
Direct Investments - - - NM
Add-on Financing for
Acquisitions 14,000 1,350 12,650 937%
Add-on Financing for
Recapitalisations 1,310 - 1,310 NM
Total 168,259 179,975 (11,716) -7%
Realisations:
Senior Loan Refinancings - 40,000 (40,000) -100%
Principal Prepayments 83,580 68,218 15,362 23%
Payment of Accrued
Payment-in-kind Interest
and Dividends and Original
Issue Discount 6,503 3,304 3,199 97%
Sale of Equity Investments 24,664 - 24,664 100%
Total 114,747 111,522 3,225 3%
Appreciation,
Depreciation, Gains and
Losses:
Gross Losses (26) - (26) NM
Portfolio Loss (26) - (26) NM
Net Gains for Foreign
Currency Translation 8,576 46 8,530 NM
Total Gains and Losses 8,550 46 8,504 NM
Gross Appreciation at 8, 7
and 6 Portfolio Companies 19,683 18,819 864 5%
Gross Depreciation at 42,
7 and 1 Portfolio Companies (184,166) (24,769) (159,397) -644%
Current Portfolio Net
(Depreciation)
Appreciation (164,483) (5,950) (158,533) NM
Net Depreciation for Foreign
Currency Translation (31,432) (13,782) (17,650) -128%
Total (Depreciation)
Appreciation (195,915) (19,732) (176,183) (9)
Net Gains, Losses,
Appreciation and
Depreciation (187,365) (19,686) (167,679) (9)
Other Financial Data:
Net Asset Value per Share 8.03 9.67 (1.64) -17%
Market Capitalisation 653,435 756,381 NA NA
Total Enterprise Value 1,562,276 1,649,963 NA NA
Credit Quality:
Weighted Average Effective
Interest Rate on Debt
Investments 12.6% 12.7%
Loans on Non-Accrual at Cost 21,165 29,875 (8,710) NM
Loans on Non-Accrual at Fair
Value 4,290 - 4,290 NM
Past Due Loans at Cost - - - NM
Past Due and Non-Accrual
Loans at Cost as a
Percentage of Total Loans 1.3% 1.9%
Past Due and Non-Accrual
Loans at Fair Value as a
Percentage of Total Loans 0.3% 0.0%
Number of Portfolio
Companies on Non-Accrual
and Past Due 1 1
Return on Equity:
LTM Net Operating Income
Return on Average Equity
at Cost 9.7% 9.4%
LTM Realised Earnings
Return on Average Equity
at Cost 10.8% 9.9%
LTM Earnings Return on
Average Equity -12.8% 7.0%
Current Quarter Net
Operating Income Return on
Average Equity at Cost
Annualised 10.1% 11.2%
Current Quarter Realised
Earnings Return on Average
Equity at Cost Annualised 13.4% 11.2%
Current Quarter
Earnings
Return on Average Equity
Annualised -67.3% 3.7%
Dividends:
Dividend Coverage (Realised
Earnings per Basic Share/
Dividend per Share) 2.13 x 1.93 x
Dividend Payout Ratio
(Dividend per Share/
Realised Earnings per
Basic Share) 0.47 x 0.52 x
Q1 Q1 2008 Versus
2007 Q1 2007
euro euro %
New Investments:
Senior Debt 118,539 (117,504) -99%
Subordinated Debt 138,016 26,021 19%
Preferred Equity 8,477 (5,405) -64%
Common Equity 1,733 (1,618) -93%
CDO/CLO Investments - - NM
Total 266,765 (98,506) -37%
European Capital Sponsored Buyouts 254,681 (254,681) -100%
Financing for Sponsored Buyouts - 152,949 NM
Direct Investments - - NM
Add-on Financing for Acquisitions 12,084 1,916 16%
Add-on Financing for
Recapitalisations - 1,310 NM
Total 266,765 (98,506) -37%
Realisations:
Senior Loan Refinancings 61,479 (61,479) -100%
Principal Prepayments 88,765 (5,185) -6%
Payment of Accrued Payment-in-kind
Interest and Dividends and
Original Issue Discount 5,667 836 15%
Sale of Equity Investments 6,983 17,681 253%
Total 162,894 (48,147) -30%
Appreciation, Depreciation, Gains
and Losses:
Gross Losses - (26) NM
Portfolio Loss - (26) NM
Net Gains for Foreign Currency
Translation 2,286 6,290 275%
Total Gains and Losses 2,286 6,264 274%
Gross Appreciation at 8, 7 and 6
Portfolio Companies 11,899 7,784 65%
Gross Depreciation at 42, 7 and 1
Portfolio Companies (886) (183,280) NM
Current Portfolio Net
(Depreciation) Appreciation 11,013 (175,496) NM
Net Depreciation for Foreign
Currency Translation (3,782) (27,650) -731%
Total (Depreciation) Appreciation 7,231 (203,146) NM
Net Gains, Losses,
Appreciation and Depreciation 9,517 (196,882) NM
Other Financial Data:
Net Asset Value per Share 10.07 (2.04) -20%
Market Capitalisation NA NA NA
Total Enterprise Value NA NA NA
Credit Quality:
Weighted Average Effective
Interest Rate on Debt Investments 12.7%
Loans on Non-Accrual at Cost - 21,165 NM
Loans on Non-Accrual at Fair Value - 4,290 NM
Past Due Loans at Cost - - NM
Past Due and Non-Accrual Loans at
Cost as a Percentage of Total Loans 0.0%
Past Due and Non-Accrual Loans at
Fair Value as a Percentage of
Total Loans 0.0%
Number of Portfolio Companies on
Non-Accrual and Past Due -
Return on Equity:
LTM Net Operating Income Return on
Average Equity at Cost 9.8%
LTM Realised Earnings Return on
Average Equity at Cost 10.4%
LTM Earnings Return on Average
Equity 12.9%
Current Quarter Net Operating
Income Return on Average Equity at
Cost Annualised 9.5%
Current Quarter Realised Earnings
Return on Average Equity at Cost
Annualised 10.7%
Current Quarter Earnings Return on
Average Equity Annualised 14.5%
Dividends:
Dividend Coverage (Realised
Earnings per Basic Share/Dividend
per Share) 1.29 x
Dividend Payout Ratio (Dividend
per Share/Realised Earnings per
Basic Share) 0.78 x
EUROPEAN CAPITAL LIMITED
STATIC POOL INFORMATION
Portfolio Statistics for Investments Made in Each of the Following Years
(in thousands)
Portfolio
statistics(1)(10)(12) 2005 2006 2007 2008 Aggregate
Internal Rate of Return
- All Investments(2)(9) 16.0% 9.4% 11.2% 13.2% 11.1%
Internal Rate of Return
- All Investments(3)(9)
16.0% 5.8% 2.9% 11.6% 6.6%
Internal Rate of Return
- Equity Investments
only(3)(9)(11)
33.7% 7.3% (4.4)% (33.4)% 6.3%
Original Investments
and Commitments(9) 237,612 1,211,837 1,487,669 152,820 3,089,938
Total Exits and
Prepayments of Original
Investments(9)
118,833 659,763 354,027 - 1,132,623
Total Interest,
Dividends and Fees
Collected(9) 41,179 113,080 72,467 1,725 228,451
Total Net Gains on
Investments 202 3,666 - - 3,868
Current Cost of
Investments 131,080 598,990 1,157,311 132,607 2,019,988
Current Fair Value of
Investments 143,996 466,608 1,016,300 127,867 1,754,771
Net Appreciation
(Depreciation)(13) 12,930 (85,240) (82,423) (983) (155,716)
Non-Accruing Loans at
Cost - 21,165 - - 21,165
Non-Accruing Loans at
Fair Value - 4,290 - - 4,290
Equity Interest at Fair
Value 31,933 165,941 153,223 7,074 358,171
Debt to EBITDA(4)(5) 5.3 5.7 6.2 6.2 6.0
Interest Coverage (4) 2.7 2.6 4.0 2.3 3.4
Debt Service
Coverage(4) 1.8 2.1 3.1 2.3 2.7
Average Age of
Companies 128 years 88 years 44 years 23 years 60 years
Ownership Percentage 14.4% 34.0% 13.9% 2.0% 18.4%
Average Sales(6) 311,383 542,402 295,500 170,945 354,232
Average EBITDA(7) 53,519 76,071 52,440 26,737 57,090
Average EBITDA
margin(7) 19.1% 14.8% 17.0% 16.9% 16.1%
Total Sales(6) 2,502,168 16,183,809 16,601,779 583,045 35,870,800
Total EBITDA(7) 477,548 2,395,909 2,817,436 98,439 5,789,332
% Senior Loans(8) 3.0% 22.2% 33.9% 0.0% 25.8%
% Loans with Lien(8) 100.0% 100.0% 100.0% 100.0% 100.0%
(1) Static pool classification is based on the year the initial
investment was made. Subsequent add-on investments are included in
the static pool year of the original investment.
(2) Assumes investments are exited based on Realisable Value that is
anticipated to be received upon settlement or maturity
(3) Assumes investments are exited at current US GAAP fair value.
(4) These amounts do not include investments in which we own only
equity.
(5) For portfolio companies with a nominal EBITDA amount, the portfolio
company's maximum debt leverage is limited to 15 times EBITDA.
(6) Sales of the most recent twelve months, or when appropriate, the
forecasted twelve months.
(7) EBITDA of the most recent twelve months, or when appropriate, the
forecasted twelve months.
(8) As a percentage of our total debt investments.
(9) Non euro-denominated amounts are retranslated at the exchange rate
ruling at the date of original investment.
(10) Non euro-denominated balances, other than those referred to in (9),
are retranslated at the exchange rate ruling at the balance sheet
date.
(11) Excludes equity investments that are the result of conversions of
debt and warrants received with the issuance of debt.
(12) Excludes derivative instruments.
(13) Balance Sheet appreciation (depreciation) of investments excluding
foreign exchange revaluation.
A summary of European Capital's dividend history post IPO and forecast
follows. For more information, please visit our website at
www.EuropeanCapital.com or call our Investor Relations Department at
+44(0)207-539-7100.
% Change of % Change of
Regular Dividend Total Dividend
Over Prior Over Prior
Year and Quarter Dividend Year Total Year
(euro) (euro)
Total 2007 to Q2 2008 0.67
2008 0.62 68% 0.62 68%
Q4 FORECAST 0.16 14%
Q3 FORECAST 0.16 23%
Q2 DECLARED 0.15 50%
Q1 0.15 N/A
2007 0.37 N/A 0.37 N/A
Q4 0.14
Q3 0.13
Q2 (IPO = 10 MAY 2007) 0.10
SHAREHOLDER CALLEuropean Capital invites shareholders, analysts and other interested persons to attend the European Capital Shareholder Call on Wednesday 14 May at 14:30 BST (9:30 EST). Callers within the UK can dial +44(0)800-62-66-06. Other callers from within Europe should dial +44(0)129-648-0100. Callers within the United States should dial +1-866-804-8688. The access code for callers is 386 589.
Point your browser to www.EuropeanCapital.com and click on the Q1 2008 Shareholder Call Slide Show button.
BEFORE THE CALL:
REVIEW SLIDE PRESENTATION IN ADVANCE OF THE SHAREHOLDER CALL The quarterly shareholder presentation includes a slide presentation to
accompany the call that participants may download and print prior to the call. You may wish to take the time to review the slides in advance of the Shareholder Call.
DURING THE CALL:
VIEW STREAMING SLIDE PRESENTATION DURING THE SHAREHOLDER CALL During the Shareholder Call you may watch and listen to the webcast or listen to the Shareholder Call by phone and step through the slides at your own pace.
AFTER THE CALL:
LISTEN AND VIEW AUDIO SLIDE PRESENTATION AFTER THE CALL
The audio of the Shareholder Call combined with the slide presentation will be made available after the call on 14 May on our website www.EuropeanCapital.com.
AUDIO ONLY PRESENTATION AVAILABLE AFTER THE SHAREHOLDER CALL: There will be a phone recording available from 1:00 BST Thursday 15 May until 1:00 BST Wednesday 28 May. If you are interested in hearing the recording of the presentation, please dial +44(0)800-032-9687 or +44(0)207-136-9233. The access code for callers is 65497516.
For further information or questions, please do not hesitate to call our Investor Relations Department at +44(0)207-539-7100 or send an email to IR@EuropeanCapital.com.
ABOUT EUROPEAN CAPITAL
European Capital is a publicly traded investment company for pan-European equity, mezzanine and senior debt investments with current capital resources of approximately euro 2.8 billion (US$4.4 billion). It is managed by European Capital Financial Services (Guernsey) Limited ("ECFSG"), an indirect wholly-owned affiliate of American Capital Strategies Ltd. ECFSG, together with its wholly owned subsidiary European Capital Financial Services Ltd ("ECFS"), is referred to as the "Investment Manager". ECFS has offices in Paris, London, Frankfurt and Madrid. As of 31 March 2008 the Investment Manager had 44 investment professionals and 66 support staff.
European Capital invests in and sponsors management and employee buyouts, invests in private equity buyouts and provides capital directly to private and public companies headquartered primarily in Europe. European Capital generally invests between euro 5 million and euro 500 million per transaction in equity, mezzanine debt and senior debt to fund growth, acquisitions and recapitalisations.
The investment objective of European Capital is to provide investors with dividend income and the potential for share value appreciation by investing in debt and equity investments in private and public companies headquartered primarily in Europe.
European Capital seeks to achieve this through pursuing the following types of investments:
European Capital One Stop Buyouts(TM)
Through our One Stop Buyouts(TM), European Capital provides equity, mezzanine debt and senior debt as the lead investor in the buyout of private and public companies.
Mezzanine Direct with Sponsors
European Capital provides debt and equity financing for buyouts sponsored by private equity firms where European Capital is either the sole or lead mezzanine debt investor.
Syndicated Mezzanine and Senior Debt
European Capital provides mezzanine and senior financing for buyouts sponsored by private equity firms where European Capital is neither the sole nor lead mezzanine or senior debt investor.
Direct Investments
European Capital provides debt and equity financing directly to private and public companies, which is used for growth, acquisitions or recapitalisations, and investing in structured finance vehicles.
Companies interested in learning more about European Capital's flexible financing should contact Nathalie Faure Beaulieu at +44(0)20-7539-7000 in London, Jean Eichenlaub at +33(0)1-40-68-06-66 in Paris, Robert von Finckenstein at +49(0)69-71-71-297-0 in Frankfurt, or Luis Felipe Castellanos at +34-91-423-27-60 in Madrid, or visit the website at
www.EuropeanCapital.com.
ABOUT AMERICAN CAPITAL
American Capital is the only private equity fund and alternative asset management company that is a member of the S? 500. With US$19 billion in capital resources under management, American Capital is the largest U.S. publicly traded alternative asset manager.
American Capital, both directly and through its global asset management business, is an investor in management and employee buyouts, private equity buyouts, and early stage and mature private and public companies. American Capital provides senior debt, mezzanine debt and equity to fund growth, acquisitions, recapitalisations and securitisations. American Capital and its affiliates invest from US$5 million to US$800 million per company in North America and euro 5 million to euro 500 million per company in Europe.
IMPORTANT DISCLOSURES
This document may contain "forward-looking statements". By their nature, forward-looking statements involve risk and uncertainty because they relate to future events and circumstances. Many of these risks and uncertainties relate to factors beyond European Capital's control or which cannot be estimated precisely. These factors include, but are not limited to, uncertainties associated with the timing of transaction closings, changes in interest rates, availability of transactions, changes in regional, national or international economic conditions, and changes in the conditions of the industries in which European Capital has made investments. Actual outcomes and results may therefore differ materially from any outcomes or results expressed or implied by any such forward-looking statements.
Performance data quoted above represents past performance of European Capital. Past performance does not guarantee future results and the investment return and principal value of an investment in European Capital will likely fluctuate. Consequently, an investor's shares, when sold, may be worth more or less than their original cost. Additionally, European Capital's current performance may be lower or higher than the performance data quoted above.
Nothing in this document is intended to be a profit forecast.
Web site: http://www.EuropeanCapital.com
John Erickson, Dir., European Capital Financial Services (Guernsey) Limited, +1-301-951-6122, or Tom McHale, Dir., European Capital Financial Services Limited, +1-301-951-6122, or Justin Cressall, Equity Capital Markets, European Capital Financial Services Limited, +1-301-951-6122