NEW YORK, Oct. 12, 2018 /PRNewswire/ -- Middle market
private companies in the Golub Capital Altman Index ("GCAI")
experienced year-over-year revenue growth of 11.75% and earnings
growth of 10.83% during the first two months of the third quarter
of 2018. This compares to year-over-year revenue growth of 11.15%
and earnings growth of 12.59% in the second quarter of 2018.
Lawrence E. Golub, CEO of Golub
Capital, said, "This quarter's Golub Capital Altman Index showed
the highest year-over-year revenue growth rate since its inception,
marking a fourth consecutive quarter of record revenue growth.
EBITDA growth was also exceptionally strong, suggesting U.S. middle
market companies have done well in controlling costs amidst a tight
labor market. Our data continues to show strong momentum in the
U.S. economy that could help offset the negative impact of tariffs.
We expect to see another robust GDP growth rate for the third
quarter of 2018, likely in excess of 3% or even 4%."
Dr. Edward I. Altman said, "The
Technology sector once again led the way for earnings growth,
posting year-over-year EBITDA growth of more than 20%. The
Healthcare sector continued to show welcome signs of a turnaround
in profitability, with positive EBITDA growth now in three of the
last four quarters. One might expect to see softness in the
Consumer and Industrial sectors, with escalating trade tensions and
meaningfully higher interest rates, crude oil prices and gasoline
prices compared to the same period last year. We have not yet seen
a material impact in our data, although it may take more time for
any impact to register. In short, the impressive revenue and
earnings growth across all sectors of the Golub Capital Altman
Index suggest the strength of the U.S. economy is broad-based."
The GCAI, which is produced by Golub Capital in collaboration
with renowned credit expert Dr. Edward I.
Altman, is the first and only index based on actual revenue
and earnings (defined as earnings before interest, taxes,
depreciation and amortization, or "EBITDA") for middle market
companies. It measures the median revenue and earnings growth of
more than 150 private U.S. companies in the loan portfolio of Golub
Capital, a leading middle market lender. Reported shortly before
public company quarterly earnings season, the GCAI has served as a
reliable indicator of the overall growth rates in revenue and
earnings of public companies in market indexes such as the S&P
500 and S&P SmallCap 600 ("S&P 600"), as well as quarterly
Gross Domestic Product ("GDP"), according to statistical
back-testing dating back to 2012, when data began to be
tracked.
The size and diversity of the Golub Capital loan portfolio
ensure that the confidentiality of all company-specific information
used in the index is maintained in both the aggregate and industry
segment data.
We believe the results (1) are representative of the general
performance of middle market companies, which are a major
contributor to U.S. private sector employment; (2) can be easily
compared to the performance of the public companies that make up
major stock indexes; (3) are relevant to the aggregate economic
performance of the U.S. economy and (4) provide timely information
for the investment community.
The companies in the GCAI operate in a wide range of industries.
Results are provided for the total universe of GCAI constituents
and by industry segment. Given the index's limited exposure to
Financials, Utilities, Energy and Materials, comparisons are made
to the S&P 500 and S&P 600 as well as to "adjusted"
versions of those indexes that exclude the aforementioned
sectors.
About Golub Capital Middle Market Lending
Golub
Capital's Middle Market Lending group provides financing for middle
market, private equity-backed transactions with hold positions of
over $600 million and is an arranger
of credit facilities up to $1
billion. Golub Capital's award-winning team strives to
establish long-term, win-win partnerships by providing dependable,
fast and creative solutions that meet private equity sponsors' and
portfolio companies' needs.
Golub Capital is a nationally recognized credit asset manager
with over $25 billion of capital
under management. For over 20 years, Golub Capital has provided
credit to help medium-sized U.S. businesses grow. The firm's
award-winning Middle Market Lending business provides financing for
middle market companies and their private equity sponsors. Golub
Capital's credit expertise also forms the foundation of its Late
Stage Lending and Broadly Syndicated Loan businesses. Golub Capital
has worked hard to build a reputation as a fast, reliable provider
of compelling financing solutions, and we believe this has inspired
repeat clients and investors. Today, the firm has over 350
employees with lending offices in Chicago, New
York and San Francisco. For
more information, please visit golubcapital.com.
About Dr. Edward I.
Altman
A leading expert on credit markets, Dr.
Edward I. Altman is the Max L. Heine
Professor of Finance, Emeritus at the NYU Stern School of Business,
and Director of Research in Credit and Debt Markets at the NYU
Salomon Center for the Study of Financial Institutions. He is
currently an advisor to several foreign central banks.
Professor Altman has published or edited two-dozen books and
over 150 articles in scholarly finance, accounting and economic
journals. He has been inducted into the Fixed Income Analysts
Society Hall of Fame, served as President of the Financial
Management Association, was an FMA Fellow, and was amongst the
inaugural inductees into the Turnaround Management Association Hall
of Fame. He received his MBA and Ph.D. in Finance from the
University of California, Los
Angeles.
Important Disclosure
The Golub Capital Altman Index is provided as an indicator only,
and does not constitute investment advice or the offer to sell or a
solicitation to buy any security. Some of these statements
constitute forward-looking statements, which may be predictions
about future events, future performance, or future financial
conditions. Some of these statements reflect opinions based upon
the data presented in the Index, and these opinions may be
incorrect. Actual results could vary materially from those implied
or expressed in such forward-looking statements for any reason. The
Golub Capital Altman Index has been created on the basis of
information provided by third-party sources that are believed to be
reliable, but the information has not been verified independently
by Golub Capital. Golub Capital makes no warranty or representation
as to the accuracy or completeness of such third-party
information.
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SOURCE Golub Capital