Investment Losses Sink Ares’ Quarter

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Ares Capital Corp. swung from profit to a loss for the fourth quarter, as losses on investments widened from last year.

The provider of debt and equity financing with offices in Los Angeles and New York reported a net loss of nearly $111 million (-$1.14 per share) compared with net income of $10.8 million (15 cents) a year earlier.

Net investment income grew 18 percent to $32.1 million. Net unrealized losses on investments jumped 639 percent to more than $144 million.

“Although we experienced our most significant quarter of net unrealized depreciation mostly resulting from marking our assets lower after the precipitous decline in loan values, we experienced only one new non-accruing loan during the quarter,” President Michael Arougheti said in a statement.

For fiscal 2008, Ares Capital reported a net loss of $140 million (-$1.56), compared with net income of $90.8 million ($1.34) in 2007.

Ares shares were up 33 cents, or 9 percent, to $3.93 in morning trading on the Nasdaq.

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