Newtek Business Services Corp. (NASDAQ:NEWT) Q3 2019 Earnings Conference Call - Final Transcript
Nov 07, 2019 • 08:30 am ET
Ladies and gentlemen thank you for standing by. And welcome to the Newtek Business Services Q3 2019 Earnings Conference Call. [Operator Instructions]. I would now like to hand the conference over to your speaker Barry Sloane President CEO and Founder. Please go ahead sir.
Thank you very much operator. And good morning everyone. I'm Barry Sloane. Welcome to our third quarter 2019 financial results conference call. I would like to call your attention to the PowerPoint presentation that you have on our website. Go to Newtekone N-e-w-t-e-k-o-n-e.com Investor Relations section. You can see a copy of the PowerPoint presentation, that will also be archived with the audio part of our presentation today. here with me today is Chris towers, our chief accounting officer and he will help me through the presentation. One of the thank everyone for their interest and investment in the tech business service Corp. stock symbol NEWT. Let's go forward to slide number two. We always like to show our historical equity performance, we've consistently outperformed the s&p 500 Russell 2000. And all the C indices as of September 30 2019, or five year return 210% or three year return 108% or one year return year to date 18.3 which does not include the queue for the dividend which is upcoming to shareholders of record. slide number three, a representation of where we sit versus other VCs on a sector evaluation comparison.
We are currently trading below market capital sort of I refer to it as magic 500 million which sort of brings you into small cap land out of micro cap or nano cap. BDCs with a market cap below 500 million traded at median price income of 0.85. Most of the BDCs obviously are externally managed and trade at around par or a discount and provide median current yield of 10.6%. Internally managed BDCs we're in that bucket traded a medium price of NAV of 1.22 and a core yield of 7.8%. Our current market cap about $4.36 million. That does not include shares that were done in the current quarter. I would say we're somewhere between as of today $435 million to $440 million in market cap including those shares. We're trading at a price to NAV of around 1.46 and a yield of 9.6%. And that's as of November 4. We look forward to continuing to grow the business which clearly is our goal and getting into that magic $500 million market cap space. Going to slide number four, third quarter financial 2019 highlights. Net investment loss NII improved by 62.5%. As the GAAP measure of income for BDCs does not include the gain on sale that we received in the SBA 7(a) business regularly since 2003. It was quite an improvement over three months. We have a slide to talk about why that's improving and why that's important.
Adjusted NII which includes our capital gains for the three months ended September 30 an improvement over 26% over the prior year's quarter. Net asset