Main Street Capital Corporation · NYSE:MAIN
Main Street Capital — IPO Roadshow (November 2022)
42 slides from Main Street Capital's IPO roadshow presentation, Nov 4, 2022
Slide 1: Debt Capital Markets Presentation Third Quarter 2022
mainstcapital.comNYSE: MAINMain Street Capital Corporation www.mainstcapital.com Page 1 Debt Capital Markets Presentation Third Quarter – 2022 Main St et Capital Corporation NYSE: IN mainstc ital.com Filed pursuant to Rule 433 Issuer Free Writing Prospectus dated November 4, 2022 Relating to Registr
Slide 2: Disclaimers
mainstcapital.comNYSE: MAINMain Street Capital Corporation www.mainstcapital.com Page 2 Disclaimers Main Street Capital Corporation (MAIN) cautions that statements in this presentation that are forward-looking, and provide other than historical information, involve risks and uncertainties that may i
Slide 3: Main Street Capital Corporation 3rd Quarter 2022
mainstcapital.comNYSE: MAINMain Street Capital Corporation www.mainstcapital.com Page 3 Main Street Capital Corporation 3rd Quarter – 2022
Slide 4: MAIN is a Principal Investor in Private Debt and Equity
mainstcapital.comNYSE: MAINMain Street Capital Corporation www.mainstcapital.com Page 4 MAIN is a Principal Investor in Private Debt and Equity Hybrid debt and equity investment strategy, internally managed operating structure and focus on Lower Middle Market differentiates MAIN from other investmen
Slide 5: Investment Portfolio – By Type of Investment
mainstcapital.comNYSE: MAINMain Street Capital Corporation www.mainstcapital.com Page 5 Investment Portfolio – By Type of Investment(1) (1) Fair value as of September 30, 2022 (2) Other portfolio investments, as described in MAIN’s SEC filings
Slide 6: Unique Investment Strategy
mainstcapital.comNYSE: MAINMain Street Capital Corporation www.mainstcapital.com Page 6 Unique Investment Strategy Middle Market • Larger companies than LMM strategy, with EBITDA between $20 - $100 million • First lien, senior secured debt investments • Floating rate debt investments • Large address
Slide 7: Portfolio Highlights
mainstcapital.comNYSE: MAINMain Street Capital Corporation www.mainstcapital.com Page 7 Portfolio Highlights(1) Middle Market • $354.3 million of total investments • 33 companies • $344.2 million of debt investments (97% of Middle Market portfolio) • 99% of debt investments are first lien(2) • Avera
Slide 8: Business Development Company (BDC) Background
mainstcapital.comNYSE: MAINMain Street Capital Corporation www.mainstcapital.com Page 8 Business Development Company (BDC) Background Leverage • Regulatory restrictions on debt leverage levels require BDCs to maintain conservative leverage • Must maintain an asset to debt coverage ratio of at least
Slide 9: MAIN Capital Structure
mainstcapital.comNYSE: MAINMain Street Capital Corporation www.mainstcapital.com Page 9 MAIN Capital Structure (1) Debt amounts reflected at par value (2) Based on stock price of $33.64 as of September 30, 2022 Current capitalization ($ in 000's) 9/30/2022 % of Capitalization Cash $ 61,158 Debt at p
Slide 10: Conservative Leverage
mainstcapital.comNYSE: MAINMain Street Capital Corporation www.mainstcapital.com Page 10 Conservative Leverage (1) Assets at the BDC/RIC parent level represent the collateral available to MAIN’s debt capital market investors (2) As of September 30, 2022, the Credit Facility includes total commitment
Slide 11: Conservative Leverage - Regulatory
mainstcapital.comNYSE: MAINMain Street Capital Corporation www.mainstcapital.com Page 11 Conservative Leverage - Regulatory Passage of the Small Business Credit Availability Act in December 2017 provided the opportunity for BDCs to obtain board or shareholder approval to access additional leverage b
Slide 12: Conservative Leverage - Excess Collateral Improves Over Time
mainstcapital.comNYSE: MAINMain Street Capital Corporation www.mainstcapital.com Page 12 Conservative Leverage - Excess Collateral Improves Over Time MAIN’s conservative use of leverage and use of equity to fund its growth results in significant excess collateral that provides protection to lenders
Slide 13: Key Credit Highlights
mainstcapital.comNYSE: MAINMain Street Capital Corporation www.mainstcapital.com Page 13 Key Credit Highlights • Management team has over 100 years of collective investment experience and relationships • Long-term working relationships together dating back over 20 years • Significant management equi
Slide 14: MAIN Executive Management Team
mainstcapital.comNYSE: MAINMain Street Capital Corporation www.mainstcapital.com Page 14 MAIN Executive Management Team (1) Member of MAIN Executive Committee (2) Member of MAIN Investment Committee; Vince Foster, MAIN’s Chairman of the Board, is also a member of MAIN’s Investment Committee (3) Chie
Slide 15: Significant Management Ownership / Investment
mainstcapital.comNYSE: MAINMain Street Capital Corporation www.mainstcapital.com Page 15 Significant Management Ownership / Investment Significant equity ownership by MAIN’s management team, coupled with internally managed structure, provides alignment of interest between MAIN’s management and our s
Slide 16: Efficient and Leverageable Operating Structure
mainstcapital.comNYSE: MAINMain Street Capital Corporation www.mainstcapital.com Page 16 Efficient and Leverageable Operating Structure “Internally managed” structure means no external management fees or expenses are paid Alignment of interest between management and investors • Greater incentives to
Slide 17: MAIN Maintains a Significant Operating Cost Advantage
mainstcapital.comNYSE: MAINMain Street Capital Corporation www.mainstcapital.com Page 17 MAIN Maintains a Significant Operating Cost Advantage Operating Expenses as a Percentage of Total Assets(1) Other BDCs Excl. Non-cash Exp (4)(6) (1) Total expenses excluding interest expense (2) For the trailing
Slide 18: Stable, Long-Term Leverage – Significant Unused Capacity
mainstcapital.comNYSE: MAINMain Street Capital Corporation www.mainstcapital.com Page 18 Stable, Long-Term Leverage – Significant Unused Capacity MAIN maintains a conservative capital structure, with limited overall leverage and low cost, long-term debt Capital structure is designed to correlate to
Slide 19: Long-term Maturity of Debt Obligations
mainstcapital.comNYSE: MAINMain Street Capital Corporation www.mainstcapital.com Page 19 (in m ill io ns ) $16.0 $63.8 $75.0 $75.0 $35.0 $85.2 $561.0 $185.0 $450.0 $500.0 SBIC debentures Credit Facility 4.50% Notes due 2022 5.20% Notes due 2024 3.00% Notes due 2026 2022 2023 2024 2025 2026 2027 2028
Slide 20: Interest Rate Impact and Sensitivity
mainstcapital.comNYSE: MAINMain Street Capital Corporation www.mainstcapital.com Page 20 Interest Rate Impact and Sensitivity The following table illustrates the approximate annual changes in the components of MAIN’s net investment income due to hypothetical increases (decreases) in interest rates(1
Slide 21: At-The-Market (ATM) Equity Program
mainstcapital.comNYSE: MAINMain Street Capital Corporation www.mainstcapital.com Page 21 At-The-Market (ATM) Equity Program Provides permanent capital to match indefinite or long-term holding period for LMM investments Facilitates maintenance of conservative leverage position Issued equity is accret
Slide 22: LMM Investment Strategy
mainstcapital.comNYSE: MAINMain Street Capital Corporation www.mainstcapital.com Page 22 LMM Investment Strategy Investment Objectives • High cash yield from secured debt investments (11.6% weighted- average cash coupon as of September 30, 2022); plus • Dividend income and periodic capital gains fro
Slide 23: LMM Investment Opportunity
mainstcapital.comNYSE: MAINMain Street Capital Corporation www.mainstcapital.com Page 23 LMM Investment Opportunity Large and critical portion of U.S. economy • 195,000+ domestic LMM businesses(1) LMM is under-served from a capital perspective and less competitive Inefficient asset class generates p
Slide 24: Private Loan Investment Strategy
mainstcapital.comNYSE: MAINMain Street Capital Corporation www.mainstcapital.com Page 24 Private Loan Investment Strategy Investment Objectives • Access proprietary investments with attractive risk-adjusted return characteristics • Generate cash yield to support MAIN monthly dividend Investment Char
Slide 25: Middle Market Debt Investment Strategy
mainstcapital.comNYSE: MAINMain Street Capital Corporation www.mainstcapital.com Page 25 Middle Market Debt Investment Strategy Investment Objective • Generate cash yield to support MAIN monthly dividend Investments in secured and/or rated debt investments • First lien, senior secured debt investmen
Slide 26: Asset Management Business
mainstcapital.comNYSE: MAINMain Street Capital Corporation www.mainstcapital.com Page 26 Asset Management Business MAIN(1) is the investment adviser to and administrator of MSC Income Fund, Inc. (MSIF), a non-listed BDC • MAIN(1) provides asset management services, including sourcing, diligence and
Slide 27: Total Investment Portfolio
mainstcapital.comNYSE: MAINMain Street Capital Corporation www.mainstcapital.com Page 27 Total Investment Portfolio Includes complementary LMM debt and equity investments, Private Loan debt investments and Middle Market debt investments Total investment portfolio at fair value consists of approximat
Slide 28: Portfolio Snapshot – Significant Diversification
mainstcapital.comNYSE: MAINMain Street Capital Corporation www.mainstcapital.com Page 28 Portfolio Snapshot – Significant Diversification (1) Excludes MAIN's one short-term portfolio investment of $2.0 million at cost and $1.9 million at fair value as of September 30, 2022 and $2.0 million at cost a
Slide 29: Portfolio Snapshot – Significant Diversification (cont.)
mainstcapital.comNYSE: MAINMain Street Capital Corporation www.mainstcapital.com Page 29 Portfolio Snapshot – Significant Diversification (cont.) (1) Excludes MAIN's one short-term portfolio investment of $2.0 million at cost and $1.9 million at fair value as of September 30, 2022 and $2.0 million a
Slide 30: Portfolio Snapshot – Significant Diversification (cont.)
mainstcapital.comNYSE: MAINMain Street Capital Corporation www.mainstcapital.com Page 30 Portfolio Snapshot – Significant Diversification (cont.) (1) Excludes MAIN's one short-term portfolio investment of $2.0 million at cost and $1.9 million at fair value as of September 30, 2022 and $2.0 million a
Slide 31: Total Portfolio by Industry
mainstcapital.comNYSE: MAINMain Street Capital Corporation www.mainstcapital.com Page 31 Total Portfolio by Industry (as a Percentage of Cost)(1) (1) Excluding MAIN’s Other Portfolio investments, the External Investment Manager and short-term portfolio investments, each as described in MAIN’s public
Slide 32: Diversified Total Portfolio
mainstcapital.comNYSE: MAINMain Street Capital Corporation www.mainstcapital.com Page 32 Diversified Total Portfolio (as a Percentage of Cost)(1) Invested Capital by Transaction Type Invested Capital by Geography (2) 29% 15% 21% 14% 21% (1) Excluding MAIN’s Other Portfolio investments, the External
Slide 33: LMM Investment Portfolio
mainstcapital.comNYSE: MAINMain Street Capital Corporation www.mainstcapital.com Page 33 LMM Investment Portfolio 75 portfolio companies / $1.9 billion in fair value • 48% of total investment portfolio at fair value Debt yielding 11.8%(1) (73% of LMM portfolio at cost) • 99% of debt investments have
Slide 34: LMM Investment Portfolio
mainstcapital.comNYSE: MAINMain Street Capital Corporation www.mainstcapital.com Page 34 LMM Investment Portfolio Median LMM portfolio credit statistics(1): • Senior leverage of 2.7x EBITDA through MAIN debt position • 2.8x EBITDA to senior interest coverage • Total leverage of 2.9x EBITDA including
Slide 35: Private Loan Investment Portfolio
mainstcapital.comNYSE: MAINMain Street Capital Corporation www.mainstcapital.com Page 35 Private Loan Investment Portfolio 87 investments / $1.5 billion in fair value • 37% of total investment portfolio at fair value Average investment size of $17.5 million(1) (less than 1% of total portfolio) Inves
Slide 36: Middle Market Investment Portfolio
mainstcapital.comNYSE: MAINMain Street Capital Corporation www.mainstcapital.com Page 36 Middle Market Investment Portfolio 33 investments / $354.3 million in fair value • 9% of total investment portfolio at fair value Average investment size of $12.7 million(1) (less than 1% of total portfolio) Inv
Slide 37: Non-GAAP Information
mainstcapital.comNYSE: MAINMain Street Capital Corporation www.mainstcapital.com Page 37 Non-GAAP Information Distributable net investment income is net investment income as determined in accordance with U.S. Generally Accepted Accounting Principles, or U.S. GAAP, excluding the impacts of non-cash c
Slide 38: Main Street Capital Corporation Appendix
mainstcapital.comNYSE: MAINMain Street Capital Corporation www.mainstcapital.com Page 38 Main Street Capital Corporation Appendix
Slide 39: MAIN Income Statement Summary
mainstcapital.comNYSE: MAINMain Street Capital Corporation www.mainstcapital.com Page 39 MAIN Income Statement Summary (1) Positive percentage represents an increase and negative percentage represents a decrease to the Net Increase (Decrease) in Net Assets (2) Excludes non-cash compensation expenses
Slide 40: MAIN Per Share Change in Net Asset Value (NAV)
mainstcapital.comNYSE: MAINMain Street Capital Corporation www.mainstcapital.com Page 40 MAIN Per Share Change in Net Asset Value (NAV) (1) See Non-GAAP Information disclosures on page 37 and reconciliation of non-cash compensation expenses and DNII per share to Net Investment Income per share on pa
Slide 41: MAIN Balance Sheet Summary
mainstcapital.comNYSE: MAINMain Street Capital Corporation www.mainstcapital.com Page 41 MAIN Balance Sheet Summary (1) Includes $500.0 million of 3.00% Notes due July 2026, $450.0 million of 5.20% Notes due May 2024 and $185.0 million of 4.50% Notes due December 2022 ($ in 000's, except per share a
Slide 42: MAIN Corporate Data
mainstcapital.comNYSE: MAINMain Street Capital Corporation www.mainstcapital.com Page 42 MAIN Corporate Data Board of Directors Vincent D. Foster Chairman of the Board Main Street Capital Corporation Board of Directors Quanta Services, Inc. J. Kevin Griffin Chief Strategy Officer MaineHealth Dwayne