BlackRock TCP Capital Corp. · NASDAQ:TCPC
BlackRock TCP Capital — Investor Presentation (November 2019)
27 slides from BlackRock TCP Capital's investor presentation, November 2019
Slide 1: BlackRock TCP Capital Corp. Investor Presentation
BlackRock TCP Capital Corp. Investor Presentation November 2019
Slide 2: Forward Looking Statements
Forward Looking Statements Prospective investors considering an investment in BlackRock TCP Capital Corp. should consider the investment objectives, ris ks and expenses of the Company carefully before investing. This information and other information about the Company are available in the Company's
Slide 3: BlackRock TCP Capital Corp – Key Highlights
BlackRock TCP Capital Corp – Key Highlights As of September 30, 2019 Who we are What we do How we do it $1.7 billion diversified portfolio Advised by Tennenbaum Capital Value-oriented investing primarily composed of directly Partners (“TCP”) with a 20-year focused on middle-market originated senior
Slide 4: Established Platform: A leader in private credit investing
Established Platform: A leader in private credit investing As of September 30, 2019 Experienced Advisor… …with Diverse Skills Complementary skill sets across direct lending More than 20 years (1) of experience investing and special situations enhance principal-protection through multiple market cycl
Slide 5: Competitive Advantages of BlackRock
Competitive Advantages of BlackRock BlackRock’s $6.96 trillion(1) investment platform creates substantial scale and scope that provides insight, access, and expertise in sourcing and underwriting differentiated investment opportunities Global Credit Expertise Information Edge One Stop Shop ▪ $105 bi
Slide 6: Breadth and Depth of the BlackRock's Global Credit Platform
Breadth and Depth of the BlackRock’s Global Credit Platform Global Credit AUM: $105 billion(1) Leveraged Finance Multi-Strategy Credit Private Credit ▪ High Yield ▪ Pan-Credit Solutions ▪ Direct Lending ▪ Bank Loans ▪ Hedge Fund Strategies ▪ Opportunistic Credit ▪ CLOs ▪ Specialty Finance BlackRock
Slide 7: Consistent and Disciplined Portfolio Growth
Consistent and Disciplined Portfolio Growth Total Investments = $1.7 billion Equity Fixed rate debt Floating rate debt $1,800 $1,600 $1,400 $1,200 Dollars in millions $1,000 $800 $600 $400 $200 $ Q2-12 Q4-12 Q2-13 Q4-13 Q2-14 Q4-14 Q2-15 Q4-15 Q2-16 Q4-16 Q2-17 Q4-17 Q2-18 Q4-18 Q2-19 7
Slide 8: Investor Friendly Advisory Fee Structure
Investor Friendly Advisory Fee Structure BlackRock TCP Capital Corp. BlackRock TCP Capital Corp. Average Externally Managed (Thru 2/8/2019) (Post 2/8/2019) BDC(1) ◼ 1.5% on gross assets (less cash ◼ 1.5% up to 1.0x debt to equity; ◼ 1.50% - 1.75% on gross assets and cash equivalents) 1.0% above 1.0x
Slide 9: Well-Covered and Consistent Dividend
Well-Covered and Consistent Dividend Net investment income of $0.43 per share Declared Q4 2019 dividend of $0.36 in Q3 2019 per share Out-earned quarterly dividend of $0.36 per share paid Payable on December 31, 2019 to holders of record on September 30, 2019 as of December 17, 2019 Dividend covered
Slide 10: Strong Track Record of Positive Performance
Strong Track Record of Positive Performance Book Value per Share and Dividends Paid As of 9/30/2019: Book Value per Share Cumulative Dividends Paid per Share (Post IPO) $26.00 $24.59 $24.00 $22.00 $20.00 $18.00 $16.00 $14.00 $12.00 $10.00 At IPO Q3-12 Q1-13 Q3-13 Q1-14 Q3-14 Q1-15 Q3-15 Q1-16 Q3-16
Slide 11: TCPC Outperformance
TCPC Outperformance Outperformed the Wells Fargo BDC Index by 24% since our IPO(1) BlackRock TCP Capital Corp. Wells Fargo Business Development Company Index As of 10/31/2019 200% TCPC: 92.3% 190% 180% 170% WFBDC: 74.3% 160% 150% 140% 130% 120% 110% 100% 90% (1) Assumes a fixed investment on April 6
Slide 12: Conservatively Positioned and Diversified Portfolio
Conservatively Positioned and Diversified Portfolio Majority of our portfolio 10.6% weighted $1.7 billion 93% of portfolio companies contribute average effective yield portfolio fair value is senior secured debt <1% to recurring income on debt portfolio(1) Diversified Income Contribution Industry Di
Slide 13: Investment Strategy & Focus
Investment Strategy & Focus ▪ Seek to generate primarily current cash income with additional return from origination and structuring fees Return Focus ▪ Potential for capital appreciation ▪ Potential upside through equity participation ▪ Directly originated and newly issued leveraged loans and, to a
Slide 14: Multi-Channel Deal Sourcing
Multi-Channel Deal Sourcing Extensive and diverse sourcing network designed to generate attractive investments across market cycles BlackRock Private Capital Industry / Sector Network Markets (BPCM) Investor Relationships Reciprocal Credit Firm Network of Industry Advisors Relationships Regional Int
Slide 15: Differentiated focus within U.S. leveraged lending market
Differentiated focus within U.S. leveraged lending market Lower Yield Higher Yield Less Downside Management More Downside Management Broadly Middle Market Middle Market Syndicated Loans Syndicated Loans Private Loans Tranche Sizes $300 million+ $200 – $300 million $25 – $200 million New Issue Pricin
Slide 16: Disciplined Investment Process
Disciplined Investment Process Industry deal teams are involved in every phase of a transaction from sourcing to eventual liquidity Rigorous Due Investment Portfolio Realizations / Diligence & Structuring Committee Management Liquidity ▪ Experienced credit team ▪ Thorough review of due ▪ Holistic ap
Slide 17: Today's Middle Market Environment
Today’s Middle Market Environment Opportunities Challenges ~200,000(1) U.S. middle-market businesses, Uptick in new market participants is intensifying representing one-third of private sector GDP, competition and pressuring yields many with limited access to capital Middle market businesses continu
Slide 18: Capturing Opportunities Throughout the Cycle
Capturing Opportunities Throughout the Cycle Late Cycle Downturn Early Cycle Mid Cycle Tight Financing Easy Financing Excess Capacity Excess Demand Strategy attributes are well positioned for a late stage cycle ✓ Senior secured, top of the capital structure ✓ Significant cushion below investment (ge
Slide 19: Case Study: Nephron Pharmaceuticals – Pharmaceutical Manufacturer
Case Study: Nephron Pharmaceuticals – Pharmaceutical Manufacturer Key Terms Investment Type: 1st lien term loan Coupon: L + 8.75% Tranche Size: $180 million Floor Protection: 1.0% Primary Industry: Healthcare Call Protection: NC 1 Country: USA Price at Investment: 97.25 Investment Overview Sourcing
Slide 20: Case Study: Lexmark Carpet Mills – Building Products
Case Study: Lexmark Carpet Mills – Building Products Key Terms Investment Type: 1st Lien Term Loan Coupon: L + 10% Tranche Size: $142 million Floor Protection: 1.0% Primary Industry: Building Products Call Protection: 103/102/par Country: USA Price at Investment: 97.50 Investment Overview Investment
Slide 21: Strategically Positioned Balance Sheet
Strategically Positioned Balance Sheet Predominantly Floating Rate Asset Portfolio Liabilities Primarily Fixed Rate 8% 29% Fixed Rate Fixed Rate Floating Rate Floating Rate 71% 92% Annual impact on net income of changes in interest rates(1) Basis Point Change Net Investment Income Net Investment Inc
Slide 22: Diversified Sources of Funding
Diversified Sources of Funding TCPC is investment grade rated by Standard & Poor’s and Moody’s As of September 30, 2019, $ in millions Source Capacity Drawn Amount Available Pricing Maturity SVCP Facility $ 270.0 $ 108.0 $ 162.0 L + 2.00% May-23 TCPC Funding Facility 350.0 177.5 172.5 L + 2.00% (5)
Slide 23: 2019 Year to Date Highlights
2019 Year to Date Highlights As of September 30, 2019 Consistent ▪ Extended our record of consistent dividend coverage to 30 consecutive quarters Dividend Coverage Disciplined ▪ Deployed $558 million gross, $114 million net of dispositions year to date Deployment ▪ Total portfolio companies reached
Slide 24: Appendix
Appendix BLACKROCK’ 24 TCP eee"
Slide 25: Financial Highlights
Financial Highlights For the For the Year Ended Quarter Ended Unaudited Audited ($ per share) Q3 2019 Q2 2019 Q1 2019 2018 2017 2016 2015 Net investment income 0.43 0.41 0.40 1.59 1.59 1.50 1.63 Net realized & unrealized gains (losses)(1) (0.12) (0.59) 0.01 (0.82) (0.40) 0.00 (0.42) Net increase in
Slide 26: Portfolio Highlights
Portfolio Highlights For the For the Year Ended Quarter Ended Asset Mix of the Investment Portfolio Q3 2019 Q2 2019 Q1 2019 2018 2017 2016 2015 (in thousands) Senior secured debt $1,555,934 $1,558,763 $1,476,326 $1,471,583 $1,404,729 $1,248,888 $1,129,571 Junior debt 20,768 50,331 43,722 43,526 41,0
Slide 27: Corporate Information
Corporate Information Securities Listing Transfer Agent NASDAQ: TCPC Equiniti Shareholder Services (800) 468-9716 (from U.S.) Research Coverage (651) 450-4064 (from outside U.S.) www.shareowneronline.com ▪ Bank of America Merrill Lynch ▪ D.A. Davidson Corporate Headquarters ▪ Deutsche Bank ▪ JMP Sec
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