WhiteHorse Finance, Inc. Reports First Quarter 2013 Earnings Results

  WhiteHorse Finance, Inc. Reports First Quarter 2013 Earnings Results

Business Wire

NEW YORK -- May 14, 2013

WhiteHorse Finance, Inc. (“WhiteHorse Finance” or the "Company") (NASDAQ: WHF)
today reported its financial results for the quarter ended March 31, 2013.

Summary Highlights

  *First quarter 2013 net investment income of $4.0 million
  *First quarter 2013 new loan originations of $53.0 million
  *First quarter distribution of $0.355 per share

Jay Carvell, WhiteHorse Finance’s Chief Executive Officer, commented, “During
the first quarter of 2013, we were able to generate more than $50 million in
new investments. We believe that our strategy of sourcing high quality
investment opportunities in the smaller end of the capital markets was a major
contributor to this quarter’s success.”

Financial Review

For the quarter ended March 31, 2013, WhiteHorse Finance reported net
investment income of $4.0 million and a net unrealized loss on investments of
$0.5 million, resulting in an increase in net assets from operations of $3.5
million.

Net Asset Value (“NAV”) was $227.2 million as of March 31, 2013, resulting in
an NAV per share of $15.18, compared with $229.0 million and NAV per share of
$15.30 reported as of December 31, 2012.

Portfolio and Investment Activity

As of March 31, 2013, the fair value of WhiteHorse Finance’s investment
portfolio was $233.2 million, principally invested in 14 positions across 12
portfolio companies, representing an increase of $52.7 million compared to the
fourth quarter 2012 balance of $180.5 million. The portfolio continues to be
comprised of 100% senior secured loans. As of March 31, 2013, the weighted
average current cash yield of the portfolio was 14.6%, an increase from 14.2%
reported as of December 31, 2012.

During the quarter, the Company originated new loans, including:

  *A $17.0 million senior secured financing for a leading wound care supply
    company; and
  *Participation in a $16.0 million senior secured loan for the largest
    private network of tertiary care hospitals in Puerto Rico.

Liquidity and Capital Resources

As of March 31, 2013, WhiteHorse Finance had cash and cash equivalents of
$137.7 million, compared with $187.8 million in the previous quarter, in each
case inclusive of restricted cash and cash equivalents. The decrease in cash
on hand was primarily due to the Company’s new investments during the quarter.
We believe our current cash position continues to provide us adequate
liquidity to operate the company and make new investments.

In addition, as of March 31, 2013, the Company had $51.3 million in
outstanding borrowings under its $150.0 million revolving credit facility and
$90.0 million outstanding under its unsecured term loan.

Distributions

On March 11, 2013, the Company declared a distribution of $0.355 per share for
the quarter ended March 31, 2013. The distribution, which was payable on April
3, 2013 to stockholders of record as of March 22, 2013, included a return of
capital for tax purposes.

The specific tax characteristics of the distributions will be reported to
stockholders on Form 1099-DIV after the end of the calendar year and in the
Company's periodic reports filed with the Securities and Exchange Commission.

Subsequent Events

On April 8, 2013, the Company filed a Form N-2 with the Securities and
Exchange Commission for a potential offering of senior notes, the net proceeds
of which would be used to reduce outstanding obligations under the Company’s
unsecured term loan and effectively extend the maturity of the Company's
capital structure, as well as for other general corporate or strategic
purposes.

Conference Call

WhiteHorse Finance will host a conference call to discuss its first quarter
earnings results at 10:00 a.m. ET on Tuesday, May 14, 2013. To access the
teleconference, please dial 706-758-9224 (domestic and international)
approximately 10 minutes before the teleconference’s scheduled start time and
reference ID# 41823606. Investors may also access the call on the investor
relations portion of the Company’s website at
http://www.whitehorsefinance.com/relations/index.php.

If you are unable to access the live teleconference, a replay will be
available beginning approximately two hours after the call’s completion
through May 21, 2013. The teleconference replay can be accessed by dialing
404-537-3406 (domestic and international) and entering ID# 41823606. A webcast
replay will also be available on the investor relations portion of the
Company’s website at http://www.whitehorsefinance.com/relations/index.php.

About WhiteHorse Finance, Inc.

WhiteHorse Finance, Inc. is a business development company that originates and
invests in loans to privately held small-cap companies across a broad range of
industries. The Company’s investment activities are managed by its investment
adviser, H.I.G. WhiteHorse Advisers, LLC, an affiliate of H.I.G. Capital,
L.L.C. (“H.I.G. Capital”). H.I.G. Capital is a leading global alternative
asset manager managing approximately $12 billion of capital across a number of
funds focused on the small-cap market. For more information about H.I.G.
Capital, please visit http://www.higcapital.com. For more information about
the Company, please visit http://www.whitehorsefinance.com.

Forward-Looking Statements

This press release may contain “forward-looking statements” within the meaning
of the Private Securities Litigation Reform Act of 1995. Statements other than
statements of historical facts included in this press release may constitute
forward-looking statements and are not guarantees of future performance or
results and involve a number of risks and uncertainties. Actual results 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 filings
with the Securities and Exchange Commission. The Company undertakes no duty to
update any forward-looking statement made herein. All forward-looking
statements speak only as of the date of this press release.


WhiteHorse Finance, Inc.
Consolidated Statement of Assets and Liabilities
(in thousands, except share and per share data)

                                  March 31, 2013     December 31, 2012
                                      (Unaudited)
                                                             
Assets
Investments, at fair value
(cost $233,547 and $180,377,          $  233,157             $    180,488
respectively)
Cash and cash equivalents                136,642                  156,123
Restricted cash and cash                 1,100                    31,646
equivalents
Interest receivable                      4,107                    1,474
Deferred financing costs                 3,066                    3,184
Due from related party                   70                       -
Prepaid expenses and other              253                     367
receivables
Total assets                          $  378,395             $    373,282
                                                             
                                                             
Liabilities
Credit facility                       $  51,250              $    51,250
Unsecured term loan                      90,000                   90,000
Distributions payable                    5,313                    1,616
Management fees payable                  2,030                    306
Payable for securities                   1,930                    -
purchased
Accounts payable and accrued            628                     1,061
expenses
Total liabilities                     $  151,151             $    144,233
                                                             
                                                             
Net assets
Common stock, par value
$0.001 per share, 14,965,624
shares issued and
outstanding,
100,000,000 authorized                $  15                  $    15
Paid-in capital in excess of             228,466                  228,466
par
Capital distributions in                 (140)                    -
excess of net income
Undistributed net investment             -                        1,164
income
Net realized loss on                     (71)                     (71)
investments
Net unrealized depreciation             (1,026)                 (525)
on investments
Total net assets                      $  227,244             $    229,049
                                                            
Total liabilities and total           $  378,395             $    373,282
net assets
                                                             
Number of shares outstanding             14,965,624               14,965,624
Net asset value per share             $  15.18               $    15.30


WhiteHorse Finance, Inc.

Consolidated Statement of Operations

(in thousands, except share and per share data)
                                                             
                                                  Three months ended March 31,
                                                   2013              2012
Investment income
Interest income                                   $ 8,382             $ 9,149
                                                                       
Total investment income                             8,382                9,149
                                                                       
Expenses
Interest expense                                  $ 1,362              $ -
Organization costs                                  -                    96
Base management fees                                1,077                -
Performance-based incentive fees                    952                  -
Administrative service fees                         389                  -
General and administrative expenses                593                243
                                                                       
Total expenses                                    $ 4,373             $ 339
                                                                       
Net investment income                             $ 4,009             $ 8,810
                                                                       
                                                                       
Realized and unrealized (loss) gain
on investments
Net realized loss on investments                  $ -                  $ -
Net change in unrealized
(depreciation) appreciation on                     (501       )        200
investments
                                                                       
Net realized and unrealized (loss)                $ (501       )       $ 200
gain on investments
                                                                       
Net increase in net assets resulting              $ 3,508             $ 9,010
from operations
                                                                       
Per Common Share Data
Basic and diluted earnings per common             $ 0.234                N/A
share ^(1)
Dividends and distributions declared              $ 0.355                N/A
per common share ^(1)
Basic and diluted weighted average                  14,965,624           N/A
common shares outstanding ^(1)
                                                                         

(1) For the three months ended March 31, 2012, the Company did not have common
shares outstanding and therefore weighted average shares outstanding
information and per share data for this period are not provided.

Contact:

WhiteHorse Finance, Inc.
Alastair Merrick, 212-506-0500
amerrick@whitehorsefinance.com
or
Prosek Partners
Brian Schaffer, 212-279-3115
bschaffer@prosek.com
 
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