European Capital

European Capital Declares euro 0.15 Q2 2008 Dividend, Reports euro 0.24 NOI and euro 0.32 Realised Earnings In Q1 2008

    St. Peter Port, Guernsey (ots/PRNewswire) -

    European Capital Limited ("European Capital") (LSE: ECAS) announced today its second quarter 2008 dividend and its results for the first quarter of 2008.

    SECOND QUARTER 2008 DIVIDEND DECLARATION

    European Capital's Board of Directors has declared a second quarter 2008 dividend of euro 0.15 per share to record holders as of 27 June 2008, payable on 25 July 2008. This is a 50% increase over the second quarter 2007 dividend of euro 0.10 per share and is in line with the dividend guidance announced at the time of its results announcement for 2007. European Capital has now paid or declared a total of euro 72.6 million in dividends since its May 2007 initial public offering ("IPO").

    2008 DIVIDEND GUIDANCE

    European Capital reiterates its 2008 dividend forecast of euro 0.62 per share, a 68% growth over post-IPO 2007 dividends of euro 0.37 per share. The remaining 2008 dividends per share are forecast to be in the following quarterly amounts.

      euro 0.16 for Q3 2008, 23% increase over Q3 2007; and
      euro 0.16 for Q4 2008, 14% increase over Q4 2007.

    FIRST QUARTER 2008 RESULTS

    Net Operating Income (NOI) European Capital also announced today its results for the first quarter of 2008. NOI for the quarter increased 4% to euro 0.24 per share, compared to euro 0.23 per share for the first quarter of 2007.

    Realised Earnings

    Realised Earnings increased 19% to euro 0.32 per share for the first quarter of 2008, compared to euro 0.27 per share for the first quarter of 2007. Realised Earnings return on equity at cost for the twelve months to the first quarter of 2008 was 11%. Realised Earnings for the first quarter 2008 covered 213% of the euro 0.15 per share dividend for the first quarter 2008.

    Earnings

    European Capital's Earnings for the first quarter of 2008 was a loss of euro 1.49 per share, a decrease of euro 1.85 per share from the first quarter of 2007 Earnings of euro 0.36 per share. Earnings return on equity for the twelve months to the first quarter of 2008 was (13)%. This loss was due to euro 165 million of unrealised depreciation during the first quarter of 2008. During the first quarter, European Capital implemented Statement of Financial Accounting Standard No. 157, Fair Value Measurements, ("SFAS 157"), new principles-based guidance to US generally accepted accounting practices ("GAAP"), which caused certain changes to the methodologies used in valuing the Company's investments.

    European Capital's net asset value ("NAV") per share at 31 March 2008 was euro 8.03, a decrease of euro 1.64 or 17% lower than the 31 December 2007 NAV per share of euro 9.67.

    "We delivered excellent NOI and Realised Earnings for the quarter." said Malon Wilkus, Chairman of the Board. "The substantial decline in our Earnings is due to euro 165 million of unrealised depreciation, which we believe will have little impact on our future revenues, NOI and Realised Earnings. This depreciation was driven by declining trading prices, the continued widening of investment spreads and our adoption of SFAS 157. We believe that with the adoption of SFAS 157, investors will need to focus on both reported US GAAP fair values as well as values that we anticipate realising on settlement or maturity of our investments ("Realisable Value"). In the future, we intend to report the anticipated Realisable Values on settlement or maturity of our investments as well as US GAAP values so investors can consider both."

    For the first quarter of 2008, net appreciation, depreciation, gains and losses totalled euro (187) million consisting of euro 9 million of net realised gains less euro 196 million of net depreciation, compared to euro 10 million of net appreciation, depreciation, gains and losses for the first quarter of 2007. The primary components of the euro 196 million of net depreciation for the quarter were as follows:

@@start.t1@@      -- euro 102 million of depreciation associated with the adoption of SFAS
          157, including the widening of investment spreads;
      -- euro 51 million of depreciation associated with the write down of
          Private Finance investments;
      -- euro 10 million of depreciation from its Structured Products, due to
          the continuing widening of investment spreads;
      -- euro 21 million of net depreciation from foreign currency translation;
      -- euro 10 million of reversals of prior foreign currency appreciation
          associated with realised gains; and
      -- euro 2 million of net depreciation on derivatives.@@end@@

    "Credit quality remains good in light of the economic environment," stated John Erickson, Director of European Capital Financial Services (Guernsey) Limited. "Most of the depreciation this quarter was not as a result of weakening credit as non-accruing loans at fair value remained within a reasonable level of 0.3% of total loans at fair value. While the European economy may be slowing, we believe we are in the later stages of the liquidity crisis. We are seeing bids for some assets starting to tighten in the second quarter and today it looks like March may have been the low point for wide spreads and asset depreciation though we will need to see the trend continue in order to know for certain."

    In the first quarter of 2008, European Capital invested euro 168 million and received euro 115 million of proceeds from realisations of portfolio investments.

    As of 31 March 2008, loans with a fair value of euro 4 million were on non-accrual representing 0.3% of total loans at fair value as of 31 March 2008, compared to no non-accrual loans at fair value as of 31 December 2007.

    "M&A volumes declined in the first quarter but high quality companies continue to come to market even in this somewhat tighter lending environment," said Ira Wagner, President of European Capital Financial Services Limited ("ECFS"). "However, debt capital continues to be available for middle market transactions. As the M&A market reflects slower world growth and a U.S. recession, we believe there will be great opportunities for our UK and continental European One-Stop Buyouts."

    Since inception, European Capital has earned a 15% compounded annual return, including interest, dividends, fees and net gains, on 29 realisations of senior debt, subordinated debt and equity investments, totalling euro 1.2 billion of committed capital. These realisations represent 35% of all amounts invested by European Capital since inception.

    "Over the past several months, numerous firms have been forced to issue dilutive equity in order to fix their balance sheets," stated Tom McHale, Director, ECFS. "We have continued to have access to the capital markets, most recently issuing euro 267 million of AAA-rated secured floating rate notes, backed by euro 486 million in loans originated by European Capital. This was one of the few asset securitisations completed on European markets this year and we are pleased to have been able to arrange this financing given the current liquidity crunch."

    During the first quarter, European Capital was also required to adopt Statement of Financial Accounting Standard No. 159, The Fair Value Option for Financial Assets and Financial Liabilities, which gave the Company the option to fair value its financial liabilities in its financial statements. European Capital did not elect the fair value option for any of its eligible financial liabilities. However, European Capital will begin providing its shareholders with supplemental information on the fair value of its financial liabilities. The cost basis and fair value of European Capital's financial liabilities as of 31 March 2008 were euro 949 million and euro 918 million, respectively, or a positive difference of euro 31 million.

    MATERIAL DIFFERENCES BETWEEN FAIR VALUE AND REALISABLE VALUE

    European Capital believes that approximately euro 110 million of the depreciation reflected in the results of this and prior quarters will ultimately be reversed when it exits the investments. European Capital invests primarily in illiquid assets, which are referred to in SFAS 157 as level 3 assets, with the intention to hold the assets to settlement or maturity. This is in contrast to the premise under US GAAP that assets generally should be valued on the basis of their current market value and, if no or limited market exists, on a hypothetical market value. European Capital has not historically sold its investment assets on a market. Instead it has typically settled its private finance investments at the time of a change of control transaction, such as through a sale or recapitalisation of its portfolio companies.

    The current lack of liquidity in the financial markets has caused investment spreads between the cost of funds and investment income to widen dramatically on investments, which in most cases results in current fair values that are materially lower than the Company anticipates realising on settlement or maturity.

    The Company is following US Regulatory Disclosures regarding SFAS 157 that allows it to disclose material differences between US GAAP fair value and values anticipated to be realised upon settlement or maturity (Realisable Value). Because European Capital believes its US GAAP fair values diverge materially from the amounts it anticipates to realise on settlement or maturity, the Company will begin to provide pro forma information on the Realisable Value of its assets in comparison to the fair value determined under US GAAP.

    The following table summarises the current cost basis and fair value of our investments as of 31 March 2008 and the amount we currently anticipate realising on settlement or maturity:

@@start.t2@@                                                                                                          Difference
                                                                                                            Between
                                                                                                          Realisable
                                                                                                            Value and
                                                              Net                                          US GAAP
        Asset        Cost    Net Apprec./  Currency  Fair Value  Realisable  Fair
        Class        Basis    (Deprec.)        Movement  US GAAP        Value(1)    Value
                      (euro)        (euro)         (euro)      (euro)         (euro)        (euro)
      Private
        Finance    1,995        (145)              (109)        1,741          1,841         100
      Structured
        Product         24         (10)                  -              14                24          10
      Derivatives      1          (1)                  8                8                 8            -
         Total      2,020        (156)              (101)        1,763          1,873         110
      (1) Realisable Value is a non-GAAP financial measure that is the future
            value that we anticipate realising on the settlement or maturity of
            our investments.@@end@@

    THIRD PARTY VALUATION OF PORTFOLIO INVESTMENTS

    European Capital's Board of Directors is responsible for determining the fair value of European Capital's portfolio investments on a quarterly basis. In that regard, the Board retains Houlihan Lokey Howard & Zukin Financial Advisors Inc. ("Houlihan Lokey") to assist it by having Houlihan Lokey regularly review a designated percentage of fair value determinations. Houlihan Lokey is a leading valuation firm engaged in over 1,000 valuation assignments per year for clients worldwide. Each quarter, Houlihan Lokey reviews approximately one quarter of European Capital's determination of the fair value of its portfolio company investments that have been portfolio companies for at least one year and that have a fair value in excess of euro 10 million, in accordance with European Capital's valuation procedures. In the first quarter of 2008, Houlihan Lokey reviewed valuations of 23 portfolio company investments having an aggregate euro 781 million in fair value as of the period end. In addition, Houlihan Lokey representatives attend European Capital's quarterly valuation meetings and provide quarterly reports and recommendations to the Audit Committee of the Board of Directors.

    For those portfolio company investments that Houlihan Lokey has reviewed during each applicable period, using the scope of review set forth by European Capital's Board of Directors and in accordance with European Capital's valuation procedures, the Board has made a fair value determination that is within the aggregate range of fair value for such investments as determined by Houlihan Lokey.

@@start.t3@@      Financial highlights for the quarter are as follows:
                                          EUROPEAN CAPITAL LIMITED
                                        CONSOLIDATED BALANCE SHEETS
                              As of 31 March 2008 and 31 December 2007
                                (in thousands, except per share data)
                                                                                                  31 March 2008
                                                          31 March    31 December          Versus
                                                              2008            2007         31 December 2007
                                                         (unaudited)
                                                              euro            euro            euro            %
      Assets
      Investments at fair value (Cost
        basis of euro 2,020,116 and
        euro 1,968,468, respectively)    1,762,681    1,925,696      (163,015)    -8%
      Cash and cash equivalents                 39,741          2,575         37,166        NM
      Restricted cash                                 20,082         30,214        (10,132)  -34%
      Other                                                 19,699          9,558         10,141    106%
            Total assets                          1,842,203    1,968,043      (125,840)    -6%
      Liabilities and Shareholders'
        Equity
      Debt (maturing within one year
        euro 582,114 and euro 793,237,
        respectively)                                 948,582        896,157         52,425        6%
      Due to European Capital
        Financial Services (Guernsey)
        Limited                                              3,616              718          2,898    404%
      Accrued dividends payable                 16,255         15,171          1,084        7%
      Other                                                  3,666          8,377         (4,711)  -56%
            Total liabilities                      972,119        920,423         51,696        6%
      Commitments and contingencies
      Shareholders' equity:
         Ordinary shares (nil par
          value, authorised to issue
          unlimited number of shares,
          108,364 issued and
          outstanding, 2007: 108,364)                 -    1,030,888  (1,030,888) -100%
         Other reserve                            1,030,888                 -    1,030,888        NM
         Undistributed net realised
          earnings                                        55,614         37,235         18,379      49%
         Net foreign currency
          (depreciation) appreciation        (59,823)      (28,391)      (31,432) -111%
         Net (depreciation)
          appreciation of investments      (156,595)         7,888      (164,483)      NM
            Total shareholders' equity        870,084    1,047,620      (177,536)  -17%
            Total liabilities and
              shareholders' equity            1,842,203    1,968,043      (125,840)    -6%
      NM = Not Meaningful
                                          EUROPEAN CAPITAL LIMITED
                                 CONSOLIDATED STATEMENTS OF OPERATIONS
                            Three Months Ended 31 March 2008 and 2007
                                (in thousands, except per share data)
                                                                Three Months Ended Three Months Ended
                                                                      31 March                  31 March
                                                                  2008         2007        2008 Versus 2007
                                                              (unaudited)(unaudited)
                                                                    euro         euro            euro        %
      OPERATING INCOME:
      Interest and dividend income                53,447        34,282        19,165      56%
      Fee and other income                                 320         3,290        (2,970)  -90%
            Total operating income                  53,767        37,572        16,195      43%
      OPERATING EXPENSES:
      Interest                                                16,029         6,940         9,089    131%
      Management fee and reimbursed
        expenses                                                9,421        11,366        (1,945)  -17%
      Incentive fee                                                -                -                -         -
      General and administrative                    2,152         1,530            622      41%
            Total operating expenses                27,602        19,836         7,766      39%
      OPERATING INCOME BEFORE INCOME TAXES  26,165        17,736         8,429      48%
      Provision for income taxes                        (81)         (144)            63    -44%
      NET OPERATING INCOME                            26,084        17,592         8,492      48%
      Net foreign currency gains                    8,576         2,286         6,290    275%
      Net loss on investments                            (26)              -            (26)      NM
      TOTAL NET REALISED EARNINGS                 34,634        19,878        14,756      74%
      Net foreign currency depreciation      (31,432)      (3,782)    (27,650) -731%
      Net (depreciation) appreciation of
        investments                                      (164,483)      11,013    (175,496)      NM
      (DECREASE) INCREASE IN NET ASSETS
        RESULTING FROM OPERATIONS
        ("EARNINGS")                                    (161,281)      27,109    (188,390) -695%
      NET OPERATING INCOME PER SHARE:
         Basic & Diluted                                    0.24          0.23          0.01        4%
      NET REALISED EARNINGS PER SHARE:
         Basic & Diluted                                    0.32          0.27          0.05      19%
      NET EARNINGS PER SHARE:
         Basic & Diluted                                  (1.49)         0.36         (1.85) -514%
      WEIGHTED AVERAGE NUMBER OF SHARES
        OUTSTANDING:
         Basic                                                108,364        75,000        33,364      44%
         Diluted                                            108,364        75,714        32,650      43%
      DIVIDENDS DECLARED PER SHARE                  0.15          0.21         (0.06)  -29%
      NM = Not Meaningful@@end@@

@@start.t4@@                                      EUROPEAN CAPITAL LIMITED
                                  OTHER FINANCIAL INFORMATION
      Three Months Ended 31 March 2008, 31 December 2007 and 31 March 2007
                            (in thousands, except per share data)
                                              (unaudited)
                                                                 Q1              Q4              Q1 2008 Versus
                                                                2008          2007                  Q4 2007
                                                                euro          euro            euro          %
      New Investments:
         Senior Debt                                    1,035         25,000      (23,965)      -96%
         Subordinated Debt                        164,037        149,937        14,100          9%
         Preferred Equity                            3,072          3,263          (191)        -6%
         Common Equity                                    115          1,775        (1,660)      -94%
         CDO/CLO Investments                              -                 -                -          NM
            Total                                        168,259        179,975      (11,716)        -7%
         European Capital
          Sponsored Buyouts                                -                 -                0        100%
         Financing for Sponsored
          Buyouts                                      152,949        178,625      (25,676)      -14%
         Direct Investments                                -                 -                -          NM
         Add-on Financing for
          Acquisitions                                14,000          1,350        12,650        937%
         Add-on Financing for
          Recapitalisations                         1,310                 -         1,310          NM
            Total                                        168,259        179,975      (11,716)        -7%
      Realisations:
         Senior Loan Refinancings                      -         40,000      (40,000)    -100%
         Principal Prepayments                  83,580         68,218        15,362         23%
         Payment of Accrued
          Payment-in-kind Interest
          and Dividends and Original
          Issue Discount                              6,503          3,304         3,199         97%
         Sale of Equity Investments          24,664                 -        24,664        100%
            Total                                        114,747        111,522         3,225          3%
      Appreciation,
        Depreciation, Gains and
        Losses:
         Gross Losses                                      (26)                -            (26)         NM
            Portfolio Loss                                (26)                -            (26)         NM
         Net Gains for Foreign
          Currency Translation                    8,576                46         8,530          NM
            Total Gains and Losses                8,550                46         8,504          NM
         Gross Appreciation at 8, 7
          and 6 Portfolio Companies          19,683         18,819            864          5%
         Gross Depreciation at 42,
          7 and 1 Portfolio Companies    (184,166)      (24,769)  (159,397)    -644%
            Current Portfolio Net
              (Depreciation)
              Appreciation                         (164,483)        (5,950)  (158,533)         NM
         Net Depreciation for Foreign
          Currency Translation                 (31,432)      (13,782)    (17,650)    -128%
            Total (Depreciation)
              Appreciation                         (195,915)      (19,732)  (176,183)        (9)
            Net Gains, Losses,
              Appreciation and
              Depreciation                         (187,365)      (19,686)  (167,679)        (9)
      Other Financial Data:
            Net Asset Value per Share            8.03            9.67         (1.64)      -17%
            Market Capitalisation              653,435        756,381              NA          NA
            Total Enterprise Value         1,562,276    1,649,963              NA          NA
         Credit Quality:
            Weighted Average Effective
              Interest Rate on Debt
              Investments                                12.6%          12.7%
            Loans on Non-Accrual at Cost  21,165         29,875         (8,710)         NM
            Loans on Non-Accrual at Fair
              Value                                        4,290                 -          4,290          NM
            Past Due Loans at Cost                    -                 -                 -          NM
            Past Due and Non-Accrual
              Loans at Cost as a
              Percentage of Total Loans          1.3%            1.9%
            Past Due and Non-Accrual
              Loans at Fair Value as a
              Percentage of Total Loans          0.3%            0.0%
            Number of Portfolio
              Companies on Non-Accrual
              and Past Due                                  1                 1
         Return on Equity:
            LTM Net Operating Income
              Return on Average Equity
              at Cost                                        9.7%            9.4%
            LTM Realised Earnings
              Return on Average Equity
              at Cost                                      10.8%            9.9%
            LTM Earnings Return on
              Average Equity                         -12.8%            7.0%
            Current Quarter Net
              Operating Income Return on
              Average Equity at Cost
              Annualised                                 10.1%          11.2%
            Current Quarter Realised
              Earnings Return on Average
              Equity at Cost Annualised         13.4%          11.2%
            Current Quarter Earnings
              Return on Average Equity
              Annualised                                -67.3%            3.7%
         Dividends:
            Dividend Coverage (Realised
              Earnings per Basic Share/
              Dividend per Share)                  2.13 x         1.93 x
            Dividend Payout Ratio
              (Dividend per Share/
              Realised Earnings per
              Basic Share)                              0.47 x         0.52 x
                                                                          Q1                 Q1 2008 Versus
                                                                         2007                      Q1 2007
                                                                         euro                 euro              %
      New Investments:
         Senior Debt                                            118,539          (117,504)      -99%
         Subordinated Debt                                  138,016              26,021         19%
         Preferred Equity                                        8,477              (5,405)      -64%
         Common Equity                                            1,733              (1,618)      -93%
         CDO/CLO Investments                                         -                  -              NM
            Total                                                  266,765            (98,506)      -37%
         European Capital Sponsored Buyouts        254,681          (254,681)    -100%
         Financing for Sponsored Buyouts                      -            152,949          NM
         Direct Investments                                          -                  -              NM
         Add-on Financing for Acquisitions          12,084                1,916         16%
         Add-on Financing for
          Recapitalisations                                          -                1,310          NM
            Total                                                  266,765            (98,506)      -37%
      Realisations:
         Senior Loan Refinancings                         61,479            (61,479)    -100%
         Principal Prepayments                              88,765              (5,185)        -6%
         Payment of Accrued Payment-in-kind
          Interest and Dividends and
          Original Issue Discount                          5,667                  836         15%
         Sale of Equity Investments                        6,983              17,681        253%
            Total                                                  162,894            (48,147)      -30%
      Appreciation, Depreciation, Gains
        and Losses:
         Gross Losses                                                    -                  (26)         NM
            Portfolio Loss                                              -                  (26)         NM
         Net Gains for Foreign Currency
          Translation                                              2,286                6,290        275%
            Total Gains and Losses                          2,286                6,264        274%
         Gross Appreciation at 8, 7 and 6
          Portfolio Companies                                11,899                7,784         65%
         Gross Depreciation at 42, 7 and 1
          Portfolio Companies                                  (886)         (183,280)         NM
            Current Portfolio Net
              (Depreciation) Appreciation                11,013          (175,496)         NM
         Net Depreciation for Foreign
          Currency Translation                              (3,782)          (27,650)    -731%
            Total (Depreciation) Appreciation         7,231          (203,146)         NM
            Net Gains, Losses,
              Appreciation and Depreciation              9,517          (196,882)         NM
              Other Financial Data:
            Net Asset Value per Share                      10.07                (2.04)      -20%
            Market Capitalisation                                 NA                    NA          NA
            Total Enterprise Value                                NA                    NA          NA
         Credit Quality:
            Weighted Average Effective
              Interest Rate on Debt Investments        12.7%
            Loans on Non-Accrual at Cost                        -              21,165          NM
            Loans on Non-Accrual at Fair Value              -                4,290          NM
            Past Due Loans at Cost                                 -                      -          NM
            Past Due and Non-Accrual Loans at
              Cost as a Percentage of Total Loans      0.0%
            Past Due and Non-Accrual Loans at
              Fair Value as a Percentage of
              Total Loans                                            0.0%
            Number of Portfolio Companies on
              Non-Accrual and Past Due                            -
         Return on Equity:
            LTM Net Operating Income Return on
              Average Equity at Cost                          9.8%
            LTM Realised Earnings Return on
              Average Equity at Cost                         10.4%
            LTM Earnings Return on Average
              Equity                                                  12.9%
            Current Quarter Net Operating
              Income Return on Average Equity at
              Cost Annualised                                      9.5%
            Current Quarter Realised Earnings
              Return on Average Equity at Cost
              Annualised                                            10.7%
            Current Quarter Earnings Return on
              Average Equity Annualised                    14.5%
         Dividends:
            Dividend Coverage (Realised
              Earnings per Basic Share/Dividend
              per Share)                                              1.29 x
            Dividend Payout Ratio (Dividend
              per Share/Realised Earnings per
              Basic Share)                                          0.78 x@@end@@

@@start.t5@@                                          EUROPEAN CAPITAL LIMITED
                                          STATIC POOL INFORMATION
      Portfolio Statistics for Investments Made in Each of the Following Years
                                                 (in thousands)
      Portfolio
        statistics(1)(10)(12)        2005          2006          2007        2008  Aggregate
      Internal Rate of Return
        - All Investments(2)(9)  16.0%          9.4%         11.2%      13.2%         11.1%
      Internal Rate of Return
        - All Investments(3)(9)
                                                16.0%          5.8%          2.9%      11.6%          6.6%
      Internal Rate of Return
        - Equity Investments
        only(3)(9)(11)
                                                33.7%          7.3%        (4.4)%  (33.4)%          6.3%
      Original Investments
        and Commitments(9)        237,612  1,211,837  1,487,669  152,820  3,089,938
      Total Exits and
        Prepayments of Original
        Investments(9)
                                            118,833      659,763      354,027            -  1,132,623
      Total Interest,
        Dividends and Fees
        Collected(9)                  41,179      113,080        72,467      1,725      228,451
      Total Net Gains on
        Investments                         202         3,666                -            -         3,868
      Current Cost of
        Investments                  131,080      598,990  1,157,311  132,607  2,019,988
      Current Fair Value of
        Investments                  143,996      466,608  1,016,300  127,867  1,754,771
      Net Appreciation
        (Depreciation)(13)         12,930    (85,240)    (82,423)      (983)  (155,716)
      Non-Accruing Loans at
        Cost                                        -        21,165                -            -        21,165
      Non-Accruing Loans at
        Fair Value                              -         4,290                -            -         4,290
      Equity Interest at Fair
        Value                              31,933      165,941      153,223      7,074      358,171
      Debt to EBITDA(4)(5)            5.3            5.7            6.2         6.2            6.0
      Interest Coverage (4)          2.7            2.6            4.0         2.3            3.4
      Debt Service
        Coverage(4)                         1.8            2.1            3.1         2.3            2.7
      Average Age of
        Companies                  128 years    88 years    44 years 23 years    60 years
      Ownership Percentage         14.4%         34.0%         13.9%        2.0%         18.4%
      Average Sales(6)            311,383      542,402      295,500  170,945      354,232
      Average EBITDA(7)            53,519        76,071        52,440    26,737        57,090
      Average EBITDA
        margin(7)                         19.1%         14.8%         17.0%      16.9%         16.1%
      Total Sales(6)            2,502,168 16,183,809 16,601,779  583,045 35,870,800
      Total EBITDA(7)              477,548  2,395,909  2,817,436    98,439  5,789,332
      % Senior Loans(8)                3.0%         22.2%         33.9%        0.0%         25.8%
      % Loans with Lien(8)        100.0%        100.0%        100.0%    100.0%        100.0%
      (1)  Static pool classification is based on the year the initial
              investment was made. Subsequent add-on investments are included in
              the static pool year of the original investment.
      (2)  Assumes investments are exited based on Realisable Value that is
              anticipated to be received upon settlement or maturity
      (3)  Assumes investments are exited at current US GAAP fair value.
      (4)  These amounts do not include investments in which we own only
              equity.
      (5)  For portfolio companies with a nominal EBITDA amount, the portfolio
              company's maximum debt leverage is limited to 15 times EBITDA.
      (6)  Sales of the most recent twelve months, or when appropriate, the
              forecasted twelve months.
      (7)  EBITDA of the most recent twelve months, or when appropriate, the
              forecasted twelve months.
      (8)  As a percentage of our total debt investments.
      (9)  Non euro-denominated amounts are retranslated at the exchange rate
              ruling at the date of original investment.
      (10) Non euro-denominated balances, other than those referred to in (9),
              are retranslated at the exchange rate ruling at the balance sheet
              date.
      (11) Excludes equity investments that are the result of conversions of
              debt and warrants received with the issuance of debt.
      (12) Excludes derivative instruments.
      (13) Balance Sheet appreciation (depreciation) of investments excluding
              foreign exchange revaluation.@@end@@

    A summary of European Capital's dividend history post IPO and forecast follows. For more information, please visit our website at www.EuropeanCapital.com or call our Investor Relations Department at +44(0)207-539-7100.

@@start.t6@@                                                              % Change of                        % Change of
                                                          Regular Dividend                Total Dividend
                                                              Over Prior                         Over Prior
      Year and Quarter          Dividend          Year              Total              Year
                                            (euro)                                 (euro)
      Total 2007 to Q2 2008                                                 0.67
      2008                                 0.62                68%                0.62                68%
      Q4 FORECAST                      0.16                14%
      Q3 FORECAST                      0.16                23%
      Q2 DECLARED                      0.15                50%
      Q1                                    0.15                N/A
      2007                                 0.37                N/A                0.37                N/A
      Q4                                    0.14
      Q3                                    0.13
      Q2 (IPO = 10 MAY 2007)    0.10@@end@@

    SHAREHOLDER CALL

    European Capital invites shareholders, analysts and other interested persons to attend the European Capital Shareholder Call on Wednesday 14 May at 14:30 BST (9:30 EST). Callers within the UK can dial +44(0)800-62-66-06. Other callers from within Europe should dial +44(0)129-648-0100. Callers within the United States should dial +1-866-804-8688. The access code for callers is 386 589.

    Point your browser to www.EuropeanCapital.com and click on the Q1 2008 Shareholder Call Slide Show button.

    BEFORE THE CALL:

    REVIEW SLIDE PRESENTATION IN ADVANCE OF THE SHAREHOLDER CALL

    The quarterly shareholder presentation includes a slide presentation to accompany the call that participants may download and print prior to the call. You may wish to take the time to review the slides in advance of the Shareholder Call.

    DURING THE CALL:

    VIEW STREAMING SLIDE PRESENTATION DURING THE SHAREHOLDER CALL

    During the Shareholder Call you may watch and listen to the webcast or listen to the Shareholder Call by phone and step through the slides at your own pace.

    AFTER THE CALL:

    LISTEN AND VIEW AUDIO SLIDE PRESENTATION AFTER THE CALL

    The audio of the Shareholder Call combined with the slide presentation will be made available after the call on 14 May on our website www.EuropeanCapital.com.

    AUDIO ONLY PRESENTATION AVAILABLE AFTER THE SHAREHOLDER CALL:

    There will be a phone recording available from 1:00 BST Thursday 15 May until 1:00 BST Wednesday 28 May. If you are interested in hearing the recording of the presentation, please dial +44(0)800-032-9687 or +44(0)207-136-9233. The access code for callers is 65497516.

    For further information or questions, please do not hesitate to call our Investor Relations Department at +44(0)207-539-7100 or send an email to IR@EuropeanCapital.com.

    ABOUT EUROPEAN CAPITAL

    European Capital is a publicly traded investment company for pan-European equity, mezzanine and senior debt investments with current capital resources of approximately euro 2.8 billion (US$4.4 billion). It is managed by European Capital Financial Services (Guernsey) Limited ("ECFSG"), an indirect wholly-owned affiliate of American Capital Strategies Ltd. ECFSG, together with its wholly owned subsidiary European Capital Financial Services Ltd ("ECFS"), is referred to as the "Investment Manager". ECFS has offices in Paris, London, Frankfurt and Madrid. As of 31 March 2008 the Investment Manager had 44 investment professionals and 66 support staff.

    European Capital invests in and sponsors management and employee buyouts, invests in private equity buyouts and provides capital directly to private and public companies headquartered primarily in Europe. European Capital generally invests between euro 5 million and euro 500 million per transaction in equity, mezzanine debt and senior debt to fund growth, acquisitions and recapitalisations.

    The investment objective of European Capital is to provide investors with dividend income and the potential for share value appreciation by investing in debt and equity investments in private and public companies headquartered primarily in Europe.

    European Capital seeks to achieve this through pursuing the following types of investments:

    European Capital One Stop Buyouts(TM)

    Through our One Stop Buyouts(TM), European Capital provides equity, mezzanine debt and senior debt as the lead investor in the buyout of private and public companies.

    Mezzanine Direct with Sponsors

    European Capital provides debt and equity financing for buyouts sponsored by private equity firms where European Capital is either the sole or lead mezzanine debt investor.

    Syndicated Mezzanine and Senior Debt

    European Capital provides mezzanine and senior financing for buyouts sponsored by private equity firms where European Capital is neither the sole nor lead mezzanine or senior debt investor.

    Direct Investments

    European Capital provides debt and equity financing directly to private and public companies, which is used for growth, acquisitions or recapitalisations, and investing in structured finance vehicles.

    Companies interested in learning more about European Capital's flexible financing should contact Nathalie Faure Beaulieu at +44(0)20-7539-7000 in London, Jean Eichenlaub at +33(0)1-40-68-06-66 in Paris, Robert von Finckenstein at +49(0)69-71-71-297-0 in Frankfurt, or Luis Felipe Castellanos at +34-91-423-27-60 in Madrid, or visit the website at www.EuropeanCapital.com.

    ABOUT AMERICAN CAPITAL

    American Capital is the only private equity fund and alternative asset management company that is a member of the S&P 500. With US$19 billion in capital resources under management, American Capital is the largest U.S. publicly traded alternative asset manager.

    American Capital, both directly and through its global asset management business, is an investor in management and employee buyouts, private equity buyouts, and early stage and mature private and public companies. American Capital provides senior debt, mezzanine debt and equity to fund growth, acquisitions, recapitalisations and securitisations. American Capital and its affiliates invest from US$5 million to US$800 million per company in North America and euro 5 million to euro 500 million per company in Europe.

    IMPORTANT DISCLOSURES

    This document may contain "forward-looking statements". By their nature, forward-looking statements involve risk and uncertainty because they relate to future events and circumstances. Many of these risks and uncertainties relate to factors beyond European Capital's control or which cannot be estimated precisely. These factors include, but are not limited to, uncertainties associated with the timing of transaction closings, changes in interest rates, availability of transactions, changes in regional, national or international economic conditions, and changes in the conditions of the industries in which European Capital has made investments. Actual outcomes and results may therefore differ materially from any outcomes or results expressed or implied by any such forward-looking statements.

    Performance data quoted above represents past performance of European Capital. Past performance does not guarantee future results and the investment return and principal value of an investment in European Capital will likely fluctuate. Consequently, an investor's shares, when sold, may be worth more or less than their original cost. Additionally, European Capital's current performance may be lower or higher than the performance data quoted above.

    Nothing in this document is intended to be a profit forecast.

    Web site: http://www.EuropeanCapital.com

ots Originaltext: European Capital
Im Internet recherchierbar: http://www.presseportal.ch

Contact:
John Erickson, Dir., European Capital Financial Services (Guernsey)
Limited, +1-301-951-6122, or Tom McHale, Dir., European Capital
Financial Services Limited, +1-301-951-6122, or Justin Cressall,
Equity Capital Markets, European Capital Financial Services Limited,
+1-301-951-6122



Weitere Meldungen: European Capital

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