Whitehorse Finance, Inc. · NASDAQ:WHF
Whitehorse Finance — Q2 2020 Earnings Presentation
19 slides from Whitehorse Finance's earnings presentation, Aug 10, 2020
Slide 1: WhiteHorse Finance, Inc. Earnings Presentation, Quarter Ended June 30, 2020
WhiteHorse Finance, Inc. Earnings Presentation Quarter Ended June 30, 2020 NASDAQ: WHF (Common Stock) NASDAQ: WHFBZ (6.50% Notes due 2025)
Slide 2: Important Information and Forward Looking Statements
Important Information and Forward Looking Statements References in this presentation to “WHF”, “we”, “us”, “our” and “the Company” refer to WhiteHorse Finance, Inc. This presentation and the information and views included herein do not constitute investment advice, or a recommendation or an offer to
Slide 3: WhiteHorse Finance Snapshot
WhiteHorse Finance Snapshot Company: WhiteHorse Finance, Inc. (“WhiteHorse Finance” or the “Company”): Equity Ticker: NASDAQ: WHF Market Cap: $206.1MM(1) NAV / Share: $14.61 Portfolio Fair Value: $547.4MM Current Dividend Yield: 14.2%(1)(2); consistent quarterly dividends of $0.355 per share since 2
Slide 4: Overview of WhiteHorse Finance, Inc.
Overview of WhiteHorse Finance, Inc. ▪ WhiteHorse Finance, Inc. is a publicly listed Business Development Company (“BDC”) that completed its IPO in December 2012 ▪ WhiteHorse Finance’s investment activities are managed by H.I.G. WhiteHorse Advisers, LLC, an affiliate of H.I.G. Capital, a leading glo
Slide 5: Overview of WhiteHorse Finance, Inc. (continued)
Overview of WhiteHorse Finance, Inc. (continued) Investment Strategy Summary Stats: Invested Capital since IPO: $1,654MM(1) ▪ Generate attractive risk-adjusted return in all market conditions by originating and investing in senior secured loans to performing lower middle market companies and leverag
Slide 6: Summary of Quarterly Results
Summary of Quarterly Results ▪ Total investments at fair value decreased to $547.4 million in Q2 2020 as compared to $557.1 million in Q1 2020. ▪ The Company made investments in three new portfolio companies for gross deployments of $33.6 million as well as funded three add-on investment for $5.8 mi
Slide 7: Quarterly Operating Highlights
Quarterly Operating Highlights Unaudited Quarterly Financials Q1 19 Q2 19 Q3 19 Q4 19 Q1 20 Q2 20 (USD in MM, expect per share data) (1) Total Investment Income $ 15.9 $ 16.0 $ 17.8 $ 17.4 $ 14.5 $ 13.8 Expenses Interest Expenses 3.1 3.2 3.5 3.7 3.7 3.2 (2) Base Management Fees 2.4 2.6 2.8 3.1 3.1 2
Slide 8: Quarterly Balance Sheet Highlights
Quarterly Balance Sheet Highlights Unaudited Quarterly Financials Q1 19 Q2 19 Q3 19 Q4 19 Q1 20 Q2 20 (USD in MM, expect per share data) Assets Investments at Fair Value $ 468.4 $ 534.8 $ 527.5 $ 589.7 $ 557.1 $ 547.4 (1) Cash and Equivalents 36.9 50.4 22.2 27.5 28.1 20.9 Other Assets 16.2 7.9 16.3
Slide 9: Portfolio Highlights
Portfolio Highlights ($ in MM, except per share data) Portfolio Investm ent Q1 2019 Q2 2019 Q3 2019 Q4 2019 Q1 2020 Q2 2020 Total Fair Value of Investments $ 468.4 $ 534.8 $ 527.5 $ 589.7 $ 557.1 $ 547.4 Number of Portfolio Investments 56 67 65 66 65 68 Number of Portfolio Companies 41 47 48 51 52 5
Slide 10: Portfolio Trends
Portfolio Trends Historical Portfolio Trends % Floating and % Fixed (Based on Fair Value) % Instrument Type (Based on Fair Value) 3.9% 2.9% 0.2% 0.1% 0.4% 5% 5% 3% 6% 100.0% 7% 9% 9% 3% 11.6% 21% 3% 11% 5% 80.0% 48% 40% 43% 33% 39% 60.0% 96.1% 97.1% 99.8% 99.9% 100.0% 100.0% 99.6% 88.4% 81% 83% 40.0
Slide 11: Borrower and Industry Diversity
Borrower and Industry Diversity Composition by Borrower (Based on Fair Value) Composition by Industry(1) (Based on Fair Value) Specialized Finance Data Processing & Outsourced Services STRS JV Future Payment Technologies, L.P. Research & Consulting Services Health Care Services Source Code Midco, LL
Slide 12: Effective Yield & Dividend Coverage
Effective Yield & Dividend Coverage Debt Portfolio Effective Yield and Borrower Leverage (1) From IPO to June 30, 2020 15.5% 14.9% 13.1% 11.8% 11.8% 11.9% 11.9% 12.1% 11.8% 11.8% 11.9% 11.9% 11.9% 12.0% 12.0% 11.9% 11.9% 11.7% 11.4% 11.7% 11.6% 11.7% 11.3% 11.1% 11.3% 11.1% 10.7% 10.4% 9.9% 9.6% 4.5
Slide 13: Net Asset Value Trends
Net Asset Value Trends Net Asset Value Per Share $16.00 $15.43 $15.50 $15.30 $15.35 $15.16 $15.00 $15.00 $15.04 $15.23 $14.81 $14.61 $14.50 $14.00 $13.98 $13.63 $13.50 $13.33 $13.00 IPO (Dec 2012) 12/31/2012 12/31/2013 12/31/2014 12/31/2015 12/31/2016 12/31/2017 12/31/2018 12/31/2019 6/30/2020 Net A
Slide 14: Funding Profile
Funding Profile Current Debt Outstanding (as of June 30, 2020) Weighted Average ($ in MM) Commitment Outstanding(1) Maturity Additional Information Interest Rate $250.0 L+2.50% Revolving Credit Facility $192.2 2024 ($100 Accordion Feature) payable quarterly 6.00% Private Notes $30.0 $30.0 payable se
Slide 15: Appendix
1“ mi WHITEHORSE
Slide 16: COVID-19 Portfolio Exposure 2Q20
COVID-19 Portfolio Exposure 2Q20 WhiteHorse Finance, Inc. STRS JV Low, 49.9% Low, 53.9% WHF STRS JV, 8.9% Low/ Moderate, 18.4% Low/ Moderate, 7.3% Very High, 6.1% Very High, 3.8% Moderate, 18.1% Moderate, 26.5% High, 3.5% High, 3.4% Fair STRS JV Fair Value % of FV WHF Value % of FV Very High $9.8 6.
Slide 17: Regional Direct Origination Footprint
Regional Direct Origination Footprint Origination Footprint (June 30, 2020) ▪ Scope of H.I.G. WhiteHorse market coverage results in consistent investment activity levels regardless of market conditions ▪ Dedicated direct lending team of over 45 investment and origination professionals ▪ Regional foo
Slide 18: Origination Pipeline Funnel
Origination Pipeline Funnel(1) Three tier sourcing platform, generating meaningful investable opportunities for WhiteHorse Finance 25 person business development Over 45 WhiteHorse deal team seeks opportunities from Deals being sourced by more than professionals dedicated to sourcing H.I.G.’s propri
Slide 19: Corporate Data
Corporate Data Board of Directors Investment Committee Corporate Officers Research Coverage Corporate Counsel John Bolduc Sami Mnaymneh Stuart Aronson Tim Hayes Dechert LLP Chairman of the Board Founder and Co-CEO of H.I.G. Capital Chief Executive Officer B. Riley FBR New York, NY Stuart Aronson Ant