Ares Capital (ARCC) Q4 2024 earnings summary

Executive summary

• Leadership transition announced: Kort Schnabel to become CEO effective April 30, 2025, with Kipp deVeer stepping down but remaining on the board and investment committee.

• Reported strong Q4 and FY 2024 results, with stable credit performance and record investment activity supporting earnings and book value growth.

• Net asset value per share increased to $19.89 at year-end 2024, marking the eighth consecutive quarter of NAV growth.

• Over the past decade, the company delivered steady or increasing dividends, increased book value per share by over 20%, and generated $500 million in realized gains above losses.

• Declared a Q1 2025 dividend of $0.48 per share, continuing over 15 years of stable or growing dividends.

Financial highlights

• Q4 2024 GAAP net income per share was $0.55, down from $0.62 in Q3 and $0.72 in Q4 2023; full-year 2024 GAAP net income per share was $2.44, down from $2.75 in 2023.

• Core earnings per share for Q4 2024 were $0.55, compared to $0.58 in Q3 and $0.63 in Q4 2023; FY 2024 Core EPS was $2.33, slightly down from $2.37 in FY 2023.

• Total portfolio at fair value reached $26.7 billion, up from $25.9 billion in Q3 and $22.9 billion a year ago.

• Weighted average yield on debt and income-producing securities at amortized cost was 11.1% at year-end, down from 12.5% a year ago.

• Stockholders' equity ended at $13.4 billion, or $19.89 per share.

Outlook and guidance

• Management expects an active investing market in 2025, with strong positioning for acquisition finance and growth capital opportunities.

• Positioned with significant available capital and strong liquidity to support new investments.

• As of January 28, 2025, investment backlog was approximately $1.8 billion, primarily in first lien senior secured loans.

• From January 1 to January 28, 2025, $1.2 billion in new investment commitments were made, with 90% in first lien senior secured loans.

• Estimated $922 million ($1.37 per share) of excess 2024 taxable income to be carried forward for 2025 distributions.