Golub Capital BDC, Inc. · NASDAQ:GBDC
Golub Capital BDC — Q4 2022 Earnings Presentation
26 slides from Golub Capital BDC's earnings presentation, November 2022
Slide 1: Golub Capital BDC, Inc. Earnings Presentation
GOLUB CAPITAL BDC, INC. EARNINGS PRESENTATION QUARTER ENDED SEPTEMBER 30, 2022
Slide 2: Disclaimer
Disclaimer Some of the statements in this presentation constitute forward-looking Such forward-looking statements may include statements preceded by, followed statements, which relate to future events or our future performance or financial by or that otherwise include the words “may,” “might,” “will
Slide 3: Summary of Financial Results
Summary of Financial Results 01
Slide 4: Summary of Financial Results vs. Prior Quarter
Summary of Financial Results vs. Prior Quarter Quarter Ended June 30, 2022 September 30, 2022 Net Investment Income Per Share Net investment income per share $0.32 $0.32 1 Amortization of purchase premium per share 0.02 0.01 Adjusted net investment income per share2 A $0.34 $0.33 Accrual (reversal)
Slide 5: GBDC Performance Drivers
GBDC Performance Drivers 0 W GOLUB CAPITAL
Slide 6: Drivers of GBDC's FQ4 2022 Earnings
Drivers of GBDC’s FQ4 2022 Earnings Key Themes from Quarter Ended September 30, 2022 Key GBDC-Specific Takeaways ■ U.S. equity and fixed income markets saw double ■ Record quarterly adjusted NII before accrual digit losses year-to-date1 (reversal) for capital gain incentive fee of $0.33 / share ■ Go
Slide 7: Unrealized Losses Drove a NAV Per Share Decrease from June 30, 2022
Unrealized Losses Drove a NAV Per Share Decrease from June 30, 2022 NAV Per Share Bridge $0.01 $0.32 ($0.30) $0.01 $15.14 ($0.28) ($0.01) 1 Adjusted NII: $0.33 $14.89 Adjusted Net Realized & Unrealized Loss: ($0.28) June 30, 2022 NAV Net Investment Reversal of Dividends Paid Net Realized Gain Net Ch
Slide 8: Summary of Financial Results for the Quarter Ended September 30, 2022
Summary of Financial Results for the Quarter Ended September 30, 2022 03
Slide 9: Summary of Quarterly Results
Summary of Quarterly Results Quarter Ended September 30, 2021 December 31, 2021 March 31, 2022 June 30, 2022 September 30, 2022 Net Investment Income Per Share Net investment income per share $0.27 $0.27 $0.25 $0.32 $0.32 Amortization of purchase premium per share1 0.03 0.04 0.02 0.02 0.01 Adjusted
Slide 10: Portfolio Highlights - New Originations
Portfolio Highlights - New Originations – Total investments at fair value decreased by approximately 3.0%, or $167.2 million, during the three months ended September 30, 2022. Quarter Ended September 30, 2021 December 31, 2021 March 31, 2022 June 30, 2022 September 30, 2022 Select Portfolio Funds Ro
Slide 11: Portfolio Highlights – Investment Mix
Portfolio Highlights – Investment Mix – The portfolio continues to be focused on first lien, senior secured loans to what we believe to be healthy, resilient middle market companies backed by strong, partnership-oriented private equity sponsors. Historical Investment Portfolio ($000) $6,000,000 $5,6
Slide 12: Portfolio Highlights – Portfolio Diversity as of September 30, 2022
Portfolio Highlights – Portfolio Diversity as of September 30, 2022 Investment Portfolio $5,446mm | 331 Investments | Average Size 0.3% Portfolio Composition by Seniority Diversification by Obligor Top 10 Investments 1% 5% 16% 9% First Lien Traditional Senior First Lien Top 25 94% One Stop Investmen
Slide 13: Portfolio Highlights – Economic Analysis: Positioned for Higher Interest Rates
Portfolio Highlights – Economic Analysis: Positioned for Higher Interest Rates 10.0% 9.2% 9.0% 7.9% 8.0% 7.9% 7.7% 7.7% 8.0% 7.5% 8.4% 7.3% 7.0% 7.4% 7.5% 7.4% 7.2% 7.1% 7.1% 6.9% 6.0% 5.5% 5.0% 5.0% 5.1% 4.9% 5.0% 5.0% 4.5% 4.5% 3.8% 4.0% 3.0% 3.0% 3.7% 2.9% 3.0% 2.8% 2.8% 2.7% 2.8% 2.0% 2.3% 1.0%
Slide 14: Portfolio Highlights - Positioned For Higher Interest Rates
Portfolio Highlights - Positioned For Higher Interest Rates: Potential for meaningfully higher quarterly adjusted net investment income (“NII”) as loans continue to reset to higher base rates* Approximate Adjusted NII per Share With Increased Base Rates +24% Increase $0.45 +12% Increase $0.41 $0.40
Slide 15: Portfolio Highlights - Credit Quality
Portfolio Highlights - Credit Quality – Fundamental credit quality as of September 30, 2022 remained strong with over 90% of the investments in our portfolio having an Internal Performance Rating1 of 4 or higher as of September 30, 2022. – Non-accrual investments at September 30, 2022 as a percentag
Slide 16: Portfolio Highlights – Portfolio Ratings
Portfolio Highlights – Portfolio Ratings Internal Performance Ratings (% of Portfolio at Fair Value) At Fiscal Year End At Quarter End December 31, March 31, June 30, September 30, Rating 2016 2017 2018 2019 2020 2021 2021 2022 2022 2022 5 5.7% 5.5% 6.4% 2.7% 6.1% 10.2% 6.8% 6.2% 5.9% 4.6% 4 83.1% 8
Slide 17: Quarterly Statements of Financial Condition
Quarterly Statements of Financial Condition As of September 30, 2021 December 31, 2021 March 31, 2022 June 30, 2022 September 30, 2022 (Dollar amounts in 000s, except share and per share data) (audited) (unaudited) (unaudited) (unaudited) (audited) Assets Investments, at fair value $4,894,886 $5,146
Slide 18: Quarterly Operating Results
Quarterly Operating Results Quarter Ended September 30, 2021 December 31, 2021 March 31, 2022 June 30, 2022 September 30, 2022 (Dollar amounts in 000s, except share and per share data) (unaudited) (unaudited) (unaudited) (unaudited) (unaudited) Investment Income Interest income $83,600 $92,336 $88,6
Slide 19: Financial Performance Highlights
Financial Performance Highlights Quarterly Return on Equity and Quarterly Distributions (Last 5 Years) Regular Distribution Special Distribution Quarterly Return on Equity* 6.7% 4.0% 3.9% 3.8% 3.3% 2.2% 2.4% 2.3% 1.9% 1.9% 2.0% 2.2% 2.1% 2.8% 2.4% 2.6% 1.6% 0.6% 0.3% -10.5% $0.44 $0.46 $0.40 $0.12 $
Slide 20: Long History of Strong Shareholder Returns
Long History of Strong Shareholder Returns Investors in GBDC’s 2010 IPO have achieved a 9.3% IRR on NAV1 As of September 30, 2022 $31.13 $0.58 $15.66 $14.89 $14.63 Sep-21 Jun-19 Mar-17 Sep-12 Dec-14 Sep-10 Mar-21 Sep-16 Dec-18 Jun-14 Mar-12 Apr-10 Sep-20 Jun-18 Mar-16 Sep-11 Dec-13 Jun-22 Mar-20 Sep
Slide 21: Liquidity and Investment Capacity
Liquidity and Investment Capacity Cash and Cash Equivalents – Unrestricted cash and cash equivalents and foreign currencies totaled $124.1 million as of September 30, 2022. – Restricted cash and cash equivalents totaled $56.4 million as of September 30, 2022. Restricted cash is held in our securitiz
Slide 22: GBDC Has a Stable, Highly Flexible and Low-Cost Funding Structure
GBDC Has a Stable, Highly Flexible and Low-Cost Funding Structure GBDC Debt Capital Structure* Debt Outstanding Undrawn Funding Source Commitment Par Commitment Reinvestment Period Stated Maturity Interest Rate1 Securitizations: 2018 Debt Securitization $408,200 $408,200 $— January 20, 2023 January
Slide 23: Common Stock and Distribution Information
Common Stock and Distribution Information Common Stock Price Data1 Fiscal Year Ending September 30, 2021 High Low End of Period First Quarter $14.15 $12.66 $14.14 Second Quarter $15.36 $14.08 $14.62 Third Quarter $16.10 $14.72 $15.42 Fourth Quarter $16.01 $15.17 $15.81 Fiscal Year Ending September 3
Slide 24: Appendix: Endnotes
Appendix: Endnotes A GOLUB CAPITAL
Slide 25: Endnotes - Non-GAAP Financial Measures
Endnotes - Non-GAAP Financial Measures 1. On September 16, 2019, the Company completed its acquisition of GCIC. The merger was accounted for under the asset acquisition method of accounting in accordance with Accounting Standards Codification (“ASC”) 805-50, Business Combinations — Related Issues. U
Slide 26: Endnotes - Drivers of GBDC's FQ4 2022 Earnings
Endnotes - Drivers of GBDC’s FQ4 2022 Earnings 1. Year-to-date as of September 30, the S&P 500 returned -23.9% and the Bloomberg U.S. Aggregate Bond Index returned -14.6%. 2. Please see the September 30, 2022 Golub Capital Middle Market Report (which is available on Golub Capital’s website at www.go