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Ares Capital Corporation Announces March 31, 2025 Financial Results and Declares Second Quarter 2025 Dividend of $0.48 Per Share

DIVIDEND DECLARATIONS

NEW YORK--(BUSINESS WIRE)-- Ares Capital Corporation (鈥淎res Capital鈥�) (NASDAQ: ARCC) announced that its Board of Directors has declared a second quarter 2025 dividend of $0.48 per share. The second quarter 2025 dividend is payable on June 30, 2025 to stockholders of record as of June 13, 2025.

MARCH 31, 2025 FINANCIAL RESULTS

Ares Capital also announced financial results for its first quarter ended March 31, 2025.

鈥淎s announced last quarter, after more than a decade as ARCC鈥檚 CEO, I will transition leadership to Kort Schnabel, effective April 30,鈥� said Kipp deVeer, Chief Executive Officer of Ares Capital. 鈥淎s I step into my new role at Ares Management, I look forward to continuing to serve as a Director of ARCC and believe that ARCC鈥檚 leadership team will continue delivering strong results for our stockholders.鈥�

鈥淲e are starting the year with solid first quarter results, underpinned by a healthy portfolio, stable credit quality, and significant financial flexibility,鈥� said Kort Schnabel, Co-President of Ares Capital. 鈥淲ith our scale, experience and disciplined approach, we believe we are well positioned to further build on our 20-year track record of delivering stockholder value during periods of uncertainty.鈥�

鈥淪ince the beginning of this year, we have actively enhanced our capital and liquidity position by first accessing the unsecured notes market and then extending maturities, increasing capacity and reducing pricing on two of our secured revolving facilities,鈥� said Scott Lem, Chief Financial Officer of Ares Capital. 鈥淲ith leverage below 1x net debt to equity, and a deep and stable capital base, our balance sheet strength allows us to continue supporting our portfolio companies while also remaining active across the direct lending market.鈥�

In the first quarter of 2025, Ares Capital made new investment commitments of approximately $3.5 billion, of which approximately $2.2 billion were funded. New investment commitments included 28 new portfolio companies and 42 existing portfolio companies. As of March 31, 2025, 245 separate private equity sponsors were represented in Ares Capital鈥檚 portfolio. Of the approximately $3.5 billion in new commitments made during the first quarter of 2025, 92% were in first lien senior secured loans, 1% were in subordinated certificates of the Senior Direct Lending Program (the 鈥淪DLP鈥�), 3% were in senior subordinated loans, 2% were in preferred equity and 2% were in other equity. Of the approximately $3.5 billion in new commitments, 90% were in floating rate debt securities, of which 93% contained interest rate floors and 1% were in the subordinated certificates of the SDLP. The weighted average yield of debt and other income producing securities funded during the period at amortized cost was 9.9% and the weighted average yield on total investments funded during the period at amortized cost was 9.6%. Ares Capital may seek to sell all or a portion of these new investment commitments, although there can be no assurance that Ares Capital will be able to do so. Also in the first quarter of 2025, Ares Capital funded approximately $576 million related to previously existing unfunded revolving and delayed draw loan commitments.

In the first quarter of 2025, Ares Capital exited approximately $2.9 billion of investment commitments, including approximately $794 million of loans sold to IHAM or certain vehicles managed by IHAM. Of the approximately $2.9 billion of exited investment commitments, 78% were first lien senior secured loans, 14% were second lien senior secured loans, 2% were subordinated certificates of the SDLP, 1% were senior subordinated loans, 3% were preferred equity and 2% were other equity. Of the approximately $2.9 billion of exited investment commitments, 85% were floating rate, 6% were fixed rate, 3% were non-income producing and 6% were on non-accrual.

As of March 31, 2025 and December 31, 2024, the weighted average grade of the portfolio at fair value was 3.1 and 3.1, respectively, and loans on non-accrual status represented 1.5% of the total investments at amortized cost (or 0.9% at fair value) and 1.7% at amortized cost (or 1.0% at fair value), respectively. For more information on Ares Capital鈥檚 portfolio investment grades and loans on non-accrual status, see 鈥淧art I鈥擨tem 2. Management鈥檚 Discussion and Analysis of Financial Condition and Results of Operations鈥擯ortfolio and Investment Activity鈥� in Ares Capital鈥檚 Quarterly Report on Form 10-Q for the quarter ended March 31, 2025, filed with the Securities and Exchange Commission (鈥淪EC鈥�) on April 29, 2025.

LIQUIDITY AND CAPITAL RESOURCES

As of March 31, 2025, Ares Capital had $647 million in cash and cash equivalents and $13.9 billion in total aggregate principal amount of debt outstanding ($13.9 billion at carrying value). Subject to borrowing base and other restrictions, Ares Capital had approximately $5.4 billion available for additional borrowings under its existing credit facilities as of March 31, 2025.

In January 2025, Ares Capital issued $1.0 billion in aggregate principal amount of unsecured notes that mature on March 8, 2032 and bear interest at a rate of 5.800% per annum (the 鈥淢arch 2032 Notes鈥�). The March 2032 Notes pay interest semi-annually and all principal is due upon maturity. The March 2032 Notes may be redeemed in whole or in part at any time at Ares Capital鈥檚 option at a redemption price equal to par plus a 鈥渕ake whole鈥� premium, if applicable, as determined pursuant to the indenture governing the March 2032 Notes, and any accrued and unpaid interest. The March 2032 Notes were issued at a discount to the principal amount. In connection with the March 2032 Notes, Ares Capital entered into a forward-starting interest rate swap for a total notional amount of $1.0 billion that matures on March 8, 2032 with an effective date of January 8, 2026. Under the forward-starting interest rate swap, Ares Capital will receive a fixed interest rate of 5.800% and will pay a floating interest rate of one-month Secured Overnight Financing Rate (鈥淪OFR鈥�) plus 1.6995%.

In March 2025, Ares Capital and its wholly owned consolidated subsidiary, ARCC FB Funding LLC (鈥淎FB鈥�), entered into an agreement to amend AFB鈥檚 revolving funding facility (the 鈥淏NP Funding Facility鈥�). The amendment, among other things, (a) extended the end of the reinvestment period from July 26, 2027 to March 20, 2028, (b) extended the stated maturity date from July 26, 2029 to March 20, 2030 and (c) adjusted the interest rate charged on the BNP Funding Facility from an applicable SOFR or a 鈥渂ase rate鈥� (as defined in the documents governing the BNP Funding Facility) plus a margin of (i) 2.10% during the reinvestment period and (ii) 2.60% following the reinvestment period to an applicable SOFR or a 鈥渂ase rate鈥� plus a margin of (i) 1.90% during the reinvestment period and (ii) 2.40% following the reinvestment period. The other terms of the BNP Funding Facility remained materially unchanged.

In March 2025, Ares Capital repaid in full the $600 million aggregate principal amount outstanding of its unsecured notes upon their maturity, which bore interest at a rate of 4.250% per annum.

During the three months ended March 31, 2025, Ares Capital issued and sold approximately 17.2 million shares of common stock under its Equity Distribution Agreements, with net proceeds totaling approximately $384 million, after giving effect to sales agents鈥� commissions and certain estimated offering expenses.

FIRST QUARTER 2025 DIVIDENDS PAID

On February 5, 2025, Ares Capital announced that its Board of Directors declared a first quarter 2025 dividend of $0.48 per share for a total of approximately $328 million. The first quarter 2025 dividend was paid on March 31, 2025 to stockholders of record as of March 14, 2025.

RECENT DEVELOPMENTS

In April 2025, Ares Capital amended and restated its senior secured credit facility (as amended and restated, the 鈥淎&R Credit Facility鈥�). The amendment, among other things, (a) increased the total commitment under the A&R Credit Facility from $4,513 million to $5,283 million, (b) modified certain covenant restrictions, (c) extended the expiration of the revolving period for lenders electing to extend their revolving commitments in an amount equal to approximately $3,878 million from April 12, 2028 to April 15, 2029, (d) extended the stated maturity date for lenders electing to extend their revolving commitments in an amount equal to approximately $3,878 million from April 12, 2029 to April 15, 2030 and (e) extended the stated maturity date for approximately $945 million of the lenders electing to extend their term loan commitments from April 12, 2029 to April 15, 2030. Lenders who elected not to extend their revolving commitments in an amount equal to approximately $246 million and $50 million will remain subject to a revolving period expiration of March 31, 2026 and April 12, 2028, respectively, and a stated maturity date of March 31, 2027 and April 12, 2029, respectively. Lenders who elected not to extend their term loan commitments in an amount equal to $24 million, $70 million and $70 million will remain subject to a maturity date of March 31, 2027, April 19, 2028 and April 12, 2029, respectively. The other terms of the A&R Credit Facility remained materially unchanged.

From April 1, 2025 through April 24, 2025, Ares Capital made new investment commitments of approximately $492 million, of which approximately $406 million were funded. Of the approximately $492 million in new investment commitments, 87% were in first lien senior secured loans, 6% were in subordinated certificates of the SDLP, 3% were in senior subordinated loans and 4% were in other equity. Of the approximately $492 million in new investment commitments, 92% were floating rate, 4% were fixed rate and 4% were non-income producing. The weighted average yield of debt and other income producing securities funded during the period at amortized cost was 9.8% and the weighted average yield on total investments funded during the period at amortized cost was 9.5%. Ares Capital may seek to sell all or a portion of these new investment commitments, although there can be no assurance that it will be able to do so.

From April 1, 2025 through April 24, 2025, Ares Capital exited approximately $394 million of investment commitments. Of the approximately $394 million of exited investment commitments, 98% were first lien senior secured loans and 2% were subordinated certificates of the SDLP. Of the approximately $394 million of exited investment commitments, all were floating rate. The weighted average yield of debt and other income producing securities exited or repaid during the period at amortized cost was 10.8% and the weighted average yield on total investments exited or repaid during the period at amortized cost was 10.8%. Of the approximately $394 million of investment commitments exited from April 1, 2025 through April 24, 2025, Ares Capital recognized total net realized gains of approximately $1 million.

In addition, as of April 24, 2025, Ares Capital had an investment backlog of approximately $2.6 billion. Investment backlog includes transactions approved by Ares Capital鈥檚 investment adviser鈥檚 investment committee and/or for which a formal mandate, letter of intent or a signed commitment have been issued, and therefore Ares Capital believes are likely to close. The consummation of any of the investments in this backlog depends upon, among other things, one or more of the following: Ares Capital鈥檚 acceptance of the terms and structure of such investment and the execution and delivery of satisfactory transaction documentation. In addition, Ares Capital may sell all or a portion of these investments and certain of these investments may result in the repayment of existing investments. Ares Capital cannot assure you that it will make any of these investments or that Ares Capital will sell all or any portion of these investments.

WEBCAST / CONFERENCE CALL

Ares Capital will host a webcast/conference call on Tuesday, April 29, 2025 at 12:00 p.m. (Eastern Time) to discuss its quarter ended March 31, 2025 financial results. PLEASE VISIT ARES CAPITAL鈥橲 WEBCAST LINK LOCATED ON THE HOME PAGE OF THE INVESTOR RESOURCES SECTION OF ARES CAPITAL鈥橲 WEBSITE FOR A SLIDE PRESENTATION THAT COMPLEMENTS THE EARNINGS CONFERENCE CALL.

All interested parties are invited to participate via telephone or the live webcast, which will be hosted on a webcast link located on the Home page of the Investor Resources section of Ares Capital鈥檚 website at . Please visit the website to test your connection before the webcast. Domestic callers can access the conference call toll free by dialing +1 (800) 225-9448. International callers can access the conference call by dialing +1 (203) 518-9708. All callers are asked to dial in 10-15 minutes prior to the call so that name and company information can be collected and to reference the conference ID ARCCQ125. For interested parties, an archived replay of the call will be available approximately one hour after the end of the call through May 29, 2025 at 5:00 p.m. (Eastern Time) to domestic callers by dialing toll free +1 (800) 753-5479 and to international callers by dialing +1 (402) 220-2675. An archived replay will also be available through May 29, 2025 on a webcast link located on the Home page of the Investor Resources section of Ares Capital鈥檚 website.

ABOUT ARES CAPITAL CORPORATION

Founded in 2004, Ares Capital is a leading specialty finance company focused on providing direct loans and other investments in private middle market companies in the United States. Ares Capital鈥檚 objective is to source and invest in high-quality borrowers that need capital to achieve their business goals, which oftentimes can lead to economic growth and employment. Ares Capital believes its loans and other investments in these companies can help generate attractive levels of current income and potential capital appreciation for investors. Ares Capital, through its investment manager, utilizes its extensive, direct origination capabilities and incumbent borrower relationships to source and underwrite predominantly senior secured loans but also subordinated debt and equity investments. Ares Capital has elected to be regulated as a business development company (鈥淏DC鈥�) and was the largest publicly traded BDC by market capitalization as of March 31, 2025. Ares Capital is externally managed by a subsidiary of Ares Management Corporation (NYSE: ARES), a publicly traded, leading global alternative investment manager. For more information about Ares Capital, visit .

FORWARD-LOOKING STATEMENTS

Statements included herein or on the webcast/conference call may constitute 鈥渇orward-looking statements,鈥� which relate to future events or Ares Capital鈥檚 future performance or financial condition. These statements are not guarantees of future performance, condition or results and involve a number of risks and uncertainties. Actual results and conditions may differ materially from those in the forward-looking statements as a result of a number of factors, including those described from time to time in Ares Capital鈥檚 filings with the SEC. Ares Capital undertakes no duty to update any forward-looking statements made herein or on the webcast/conference call.

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INVESTOR RELATIONS CONTACTS

Ares Capital Corporation

John Stilmar or Carl Drake

(888) 818-5298

[email protected]

Source: Ares Capital Corporation