First Quarter 2017 Earnings Presentation 1 Important Notice This - PowerPoint PPT Presentation

First Quarter 2017 Earnings Presentation 1

Important Notice This presentation contains “forward looking statements” within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended, that are subject to risks and uncertainties. Actual outcomes and results could differ materially from those suggested by this presentation due to the impact of many factors beyond the control of Ares Capital Corporation ("Ares Capital"), including those listed in the “Risk Factors” section of our filings with the Securities and Exchange Commission (“SEC”). Any such forward-looking statements are made pursuant to the safe harbor provisions available under applicable securities laws and Ares Capital Corporation assumes no obligation to update or revise any such forward-looking statements. Certain information discussed in this presentation (including information relating to portfolio companies) was derived from third party sources and has not been independently verified and, accordingly, Ares Capital Corporation makes no representation or warranty in respect of this information. On January 3, 2017 (the "Acquisition Date"), Ares Capital completed the acquisition of American Capital, Ltd. ("American Capital") (the "American Capital Acquisition"). Ares Capital acquired $3.6 billion of assets, including $2.5 billion of investments, and assumed $226 million of liabilities for total cash and stock consideration of $3.3 billion. In connection with the stock consideration, Ares Capital issued approximately 112 million shares of its common stock to American Capital’s then-existing stockholders (including to holders of outstanding in-the-money American Capital stock options), thereby resulting in our then- existing stockholders owning approximately 73.7% of the combined company and then-existing American Capital stockholders owning approximately 26.3% of the combined company. The financial and other data set forth below for the first quarter of 2017 reflect the results of the combined company, unless otherwise noted. The following slides contain summaries of certain financial and statistical information about Ares Capital. The information contained in this presentation is summary information that is intended to be considered in the context of our SEC filings and other public announcements that we may make, by press release or otherwise, from time to time. We undertake no duty or obligation to publicly update or revise the information contained in this presentation. In addition, information related to past performance, while helpful as an evaluative tool, is not necessarily indicative of future results, the achievement of which cannot be assured. You should not view the past performance of Ares Capital, or information about the market, as indicative of Ares Capital’s future results. This presentation does not constitute an offer to sell or the solicitation of an offer to buy any securities of Ares Capital. 2

Financial and Portfolio Highlights Financial Highlights Q1-17 Q4-16 Q1-16 (all per share amounts, excluding net asset value per share, are basic and diluted) (unaudited) (unaudited) (unaudited) Core EPS* (1) $0.32 $0.42 $0.37 Net Investment Income Per Share $0.22 $0.44 $0.36 Net Realized Gains Per Share $0.01 $0.10 $0.09 Net Unrealized Gains (Losses) Per Share $0.05 $(0.30) $(0.03) GAAP Net Income Per Share $0.28 $0.24 $0.42 Net Asset Value Per Share $16.50 $16.45 $16.50 Portfolio Highlights Q1-17 Q4-16 Q1-16 (dollar amounts in millions) (unaudited) (unaudited) (unaudited) Gross Commitments** $864 $1,164 $471 Exits of Commitments (2) $836 $1,102 $484 Total Fair Value of Investments $11,407 $8,820 $9,072 Weighted Average Yield of Debt & Other Income Producing Securities at Amortized Cost (3) 9.3% 9.3% 10.1% Weighted Average Yield on Total Investments at Amortized Cost (4) 8.1% 8.3% 9.2% *See page 24 hereof for reconciliations of basic and diluted Core EPS to GAAP EPS, the most directly comparable GAAP financial measure. Note: Endnotes begin on page 26. **Excludes investments acquired as part of the American Capital Acquisition in Q1-17. 3

Selected Historical Financial Information As of and for the Three Months Ended (unaudited) (dollar amounts in millions, except per share data and stock prices) 3/31/17 12/31/16 9/30/16 6/30/16 3/31/16 Core EPS – Basic and Diluted* (1) $ 0.32 $ 0.42 $ 0.43 $ 0.39 $ 0.37 Net Investment Income Per Share – Basic and Diluted $ 0.22 $ 0.44 $ 0.44 $ 0.34 $ 0.36 Net Realized and Unrealized Gains (Losses) Per Share – Basic and Diluted $ 0.06 $ (0.20) $ (0.09) $ 0.16 $ 0.06 GAAP EPS – Basic and Diluted $ 0.28 $ 0.24 $ 0.35 $ 0.50 $ 0.42 Dividend Declared and Payable Per Share $ 0.38 $ 0.38 $ 0.38 $ 0.38 $ 0.38 ** Stockholders' Equity $ 7,035 $ 5,165 $ 5,209 $ 5,218 $ 5,180 Net Asset Value Per Share $ 16.50 $ 16.45 $ 16.59 $ 16.62 $ 16.50 Principal Debt/Book Equity Ratio .67x .76x .73x .74x .78x Principal Debt/Book Equity Ratio, Net of Available Cash (5) .64x .73x .71x .72x .77x Unsecured Principal Debt to Total Principal Debt 71.0% 78.3% 81.4% 64.6% 67.1% Weighted Average Stated Interest on Debt (6) 4.0% 4.2% 4.2% 3.9% 4.0% Net Interest and Dividend Margin (7) 7.9% 7.7% 7.8% 7.8% 7.7% Ratio of Earnings to Fixed Charges (8) 3.0 3.8 4.1 3.6 3.4 Market Capitalization Principal Debt $ 4,683 $ 3,951 $ 3,801 $ 3,860 $ 4,063 Equity 7,409 5,177 4,866 4,458 4,659 Total Market Capitalization $ 12,092 $ 9,128 $ 8,667 $ 8,318 $ 8,722 Common Stock Data: High Price during the period $ 17.81 $ 16.86 $ 16.40 $ 15.38 $ 14.84 Low Price during the period $ 16.42 $ 15.16 $ 13.96 $ 13.87 $ 12.54 Closing Price $ 17.38 $ 16.49 $ 15.50 $ 14.20 $ 14.84 *See page 24 hereof for reconciliations of basic and diluted Core EPS to GAAP EPS, the most directly comparable GAAP financial measure. **Includes equity issued of $1.8 billion in January 2017 in connection with the American Capital Acquisition. 4

Selected Historical Financial Information As of the Three Months Ended (unaudited) (dollar amounts in millions) 3/31/17 12/31/16 9/30/16 6/30/16 3/31/16 Investments at Fair Value $ 11,407 $ 8,820 $ 8,805 $ 8,900 $ 9,072 Number of Portfolio Companies (9) 316 218 215 214 220 Asset Class (at fair value): First Lien Senior Secured Loans 24% 23% 25% 29% 29% Second Lien Senior Secured Loans 34% 34% 32% 31% 31% Senior Direct Lending Program (10) 2% 3% 2% —% —% Senior Secured Loan Program (11) 17% 22% 22% 21% 21% Senior Subordinated Debt 8% 8% 8% 8% 8% Collateralized Loan Obligations 2% —% —% —% —% Preferred Equity 4% 3% 4% 4% 4% Other Equity and Other 9% 7% 7% 7% 7% Interest Rate Type (at fair value) % Floating Rate (12) 79% 81% 80% 80% 80% % Fixed Rate 9% 9% 10% 10% 10% % Equity and Other Non-Interest Earning 12% 10% 10% 10% 10% Yields: Weighted Avg. Yield on Debt and Other Income Producing Securities at Amortized Cost (3) 9.3% 9.3% 9.7% 9.8% 10.1% Weighted Avg. Yield on Debt and Other Income Producing Securities at Fair Value (3) 9.4% 9.4% 9.8% 9.9% 10.3% Weighted Average Yield on Total Investments at Amortized Cost (4) 8.1% 8.3% 8.7% 8.9% 9.2% Weighted Average Yield on Total Investments at Fair Value (4) 8.2% 8.5% 8.8% 9.0% 9.3% 5

Selected Historical Financial Information (cont’d) For the Three Months Ended (unaudited) (dollar amounts in millions) 3/31/17 12/31/16 9/30/16 6/30/16 3/31/16 Commitments: Gross Commitments* $ 864 $ 1,164 $ 1,529 $ 540 $ 470 Exits of Commitments (2) (836) (1,102) (1,499) (759) (484) Net Commitments (13) $ 28 $ 62 $ 30 $ (219) $ (14) Gross Commitments Information*: Number of Transactions 28 24 28 11 19 Weighted Average Commitment Term in Months 65 84 94 64 59 Average Commitment in Period $ 31 $ 49 $ 55 $ 49 $ 25 Fundings*: Gross Fundings $ 914 $ 1,089 $ 1,385 $ 518 $ 498 Net Fundings (13) $ 5 $ 90 $ (68) $ (202) $ 15 Portfolio Turnover 0.09 0.11 0.16 0.06 0.05 * Q1-17 excludes investments acquired as part of the American Capital Acquisition. 6

Quarterly Operating Results For the Three Months Ended (unaudited) (amounts in millions, except per share data) 3/31/17 12/31/16 9/30/16 6/30/16 3/31/16 Investment income $ 275 $ 261 $ 258 $ 245 $ 248 Expenses 179 114 117 136 130 Net investment income before income taxes 96 147 141 109 118 Income tax expense, including excise tax 2 8 4 4 5 Net investment income 94 139 137 105 113 Net realized and unrealized gains (losses) 24 (64) (27) 52 19 Net Income $ 118 $ 75 $ 110 $ 157 $ 132 Per Share: Core EPS - Basic and Diluted* (1) $ 0.32 $ 0.42 $ 0.43 $ 0.39 $ 0.37 Net Income - Basic and Diluted $ 0.28 $ 0.24 $ 0.35 $ 0.50 $ 0.42 Dividends Declared and Payable $ 0.38 $ 0.38 $ 0.38 $ 0.38 $ 0.38 Weighted average shares of common stock outstanding - Basic and Diluted 422 314 314 314 314 Common shares outstanding at end of period 426 314 314 314 314 *See page 24 hereof for reconciliations of basic and diluted Core EPS to GAAP EPS, the most directly comparable GAAP financial measure. 7