Gladstone Capital Corporation · NASDAQ:GLAD
Gladstone Capital — Investor Presentation (March 2022)
16 slides from Gladstone Capital's investor presentation, Mar 31, 2022
Slide 1: Investor Presentation for the Fiscal Quarter Ended March 31, 2022
Investor Presentation for the Fiscal Quarter Ended March 31, 2022 FINANCING FOR LOWER MIDDLE MARKET COMPANIES
Slide 2: Legal Disclaimer
Legal Disclaimer Forward-Looking Statements: This presentation may include “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. These forward-looking statements may include commen
Slide 3: Gladstone Capital Overview
Gladstone Capital Overview Background: − Founded in 2001, Gladstone Capital was one of the first business development companies (BDC) focused on making loans to lower middle market U.S. businesses ($3-15MM of EBITDA) and today the investment team remains dedicated to the BDC’s activities and perform
Slide 4: Why Invest in a BDC?
Why Invest in a BDC? BDCs are regulated by the SEC, which mandates asset diversity, investor transparency via quarterly SEC filings including fair value adjustments of all assets and limits financial leverage to a maximum of 2:1 debt to equity leverage. BDCs typically operate as regulated investment
Slide 5: Strategy and Risk Management
Gladstone Capital Strategy and Risk Management Investment Strategy: Originate secured debt investments in established lower middle market companies with sustainable margins/cash flows and favorable growth characteristics, which can support a leveraged capital structure Target companies with oper
Slide 6: Attractive Lower Middle Market Dynamics
Attractive Lower Middle Market Dynamics Why we target lower middle market (“LMM”) companies Greater industry diversity and more consistent flow of growth-oriented investment opportunities across the vast array of U.S. based businesses Lower middle market companies typically sell for lower cash f
Slide 7: 3/31/2022 Quarter Summary
Gladstone Capital 3/31/2022 Quarter Summary Originations/Portfolio Activity: Invested $11 million during the quarter, which consisted of small add-on investments to existing portfolio companies. Received $50.9 million in exits and repayments, resulting in a $39.9 million decline in assets for th
Slide 8: Origination Activity
Gladstone Capital Origination Activity Originations for the quarter ended March 31, 2022 declined with the overall market activity and net of exits and repayments resulted in a $40 million decline in investments for the period. Gladstone Capital Quarterly Net Investment 3/31/2020 6/30/2020 9/30/20
Slide 9: Portfolio Trends
Gladstone Capital Portfolio Trends Net originations have generally maintained pace with the surge of portfolio exits over the past several quarters while generating realized gains of $19.8 million over the past four quarters. PE sponsor demand for flexible first lien/unitranche financing continu
Slide 10: Portfolio Metrics
Portfolio Metrics Consistent with GLAD’s LMM focus, the core loan portfolio continues to represent companies with and average EBITDA of approx. $10 million and an average leverage multiple of 3.7x EBITDA *For the purposes of this presentation, certain investments have been excluded from the data use
Slide 11: Industry and Deal Sources Are Diversified
Industry and Deal Sources Are Diversified Portfolio Diversification Across 13 Deal Source Composition - Industries - At 3/31/2022 Fair Value At 3/31/2022 Fair Value Page 11
Slide 12: Portfolio Composition
Portfolio Composition Portfolio Characteristics As Of: June 30, 2021 September 30, 2021 December 31, 2021 March 31, 2022 Total Portfolio - FV $ 506,372 $ 557,612 $ 576,595 $ 537,703 # of Portfolio Companies 47 46 47 45 Average Investment Size - FV $ 10,774 $ 12,122 $ 12,268 $ 11,949 Top 5 Investment
Slide 13: Representative Portfolio Investments
Representative Portfolio Investments Page 13
Slide 14: Quarterly Financial Summary
Quarterly Financial Summary Three Months Ended In Thousands, except per share data June 30, 2021 September 30, 2021 December 31, 2021 March 31, 2022 Income: Interest Income $ 12,746 $ 13,245 $ 12,866 $ 12,962 Other Investment Income 920 1,116 3,301 4,298 Total Investment Income 13,666 14,361 16,167
Slide 15: 3/31/2022 Quarter Summary
Gladstone Capital 3/31/2022 Quarter Summary Capital Base and Liquidity Liabilities declined to $223 million as of 3/31/2022, consisting primarily of $150 million of 5.125% senior notes due 2026 and $50.0 million of 3.75% senior notes due 2027. Total leverage declined during the quarter to 68% of
Slide 16: Corporate Data
Corporate Data Executive Officers Research Coverage Websites David Gladstone Gladstone Capital: Ladenburg Thalmann Chairman & CEO www.gladstonecapital.com Mickey Schleien Terry Lee Brubaker Investment Adviser: Vice Chairman & COO Oppenheimer & Co. www.gladstonemanagement.com Bob Marcotte Mitchel Pen
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