Blackrock Tcp Capital Corp. · NASDAQ:TCPC

Blackrock Tcp Capital — TCP Capital — Wells Fargo Investment Thought Leadership Forum 2017

29 slides from Blackrock Tcp Capital's conference presentation, Dec 6, 2017

  1. Slide 1: Wells Fargo Investment Thought Leadership Forum

    Wells Fargo Investment Thought Leadership Forum December 2017 © 2017 Tennenbaum Capital Partners, LLC. All Rights Reserved.

  2. Slide 2: Presenter

    Presenter Chairman & CEO, TCP Capital Corp. Howard Levkowitz Managing Partner & Co-Founder, Tennenbaum Capital Partners 2

  3. Slide 3: Forward Looking Statements

    Forward Looking Statements Prospective investors considering an investment in TCP Capital Corp. should consider the investment objectives, risks and expenses of the Company carefully before investing. This information and other information about the Company are available in the Company's filings wit

  4. Slide 4: Overview

    Overview

  5. Slide 5: Established Platform – Tennenbaum Capital Partners

    Established Platform – Tennenbaum Capital Partners (“Tennenbaum”) Externally Managed by Tennenbaum Experienced Team with Diverse Skills 19 industry-focused verticals with Over $8 billion in committed capital senior experienced professionals investing under management across asset classes 20-year(1)

  6. Slide 6: Overview of Tennenbaum Capital Platform

    Overview of Tennenbaum Capital Platform Tennenbaum Over $8 billion of committed capital under management(1) TCP Capital Corp. Private Institutional Registered Fund (NASDAQ: TCPC) Vehicles Publicly-traded BDC (1) As of December 1, 2017. 6

  7. Slide 7: Portfolio Growth Since IPO

    Portfolio Growth Since IPO Portfolio Growth Since IPO $1,800 $1,600 $1.5 billion $1,400 $1,200 Dollars in millions $1,000 $800 $600 $400 $200 $ Q2-12 Q3-12 Q4-12 Q1-13 Q2-13 Q3-13 Q4-13 Q1-14 Q2-14 Q3-14 Q4-14 Q1-15 Q2-15 Q3-15 Q4-15 Q1-16 Q2-16 Q3-16 Q4-16 Q1-17 Q2-17 Q3-17 Equity Fixed rate debt F

  8. Slide 8: Best-In-Class Advisory Fee Structure

    Best-In-Class Advisory Fee Structure Typical Externally Managed BDCs(1) TCP Capital Corp. Base Management Fee  1.5% - 2.0% on gross assets  1.5% on gross assets (less cash and cash equivalents) Incentive Fee Hurdle  2.0% quarterly return on NAV  2.0% quarterly return on NAV  Capital Gains: 20%

  9. Slide 9: Consistent Track Record of Out-Earning Dividend

    Consistent Track Record of Out-Earning Dividend  Net investment income(1) of $0.38 per share  Quarterly dividend of $0.36 per share paid on September 30, 2017  Declared Q4 2017 dividend of $0.36 per share  Payable on December 29, 2017 to holders of record as of December 15, 2017  Dividend cover

  10. Slide 10: Strong Track Record of Performance

    Strong Track Record of Performance Book Value per Share and Dividends Paid $24.00 $23.04 $22.80 $23.00 $22.32 $21.95 $22.00 $21.52 $21.06 $20.62 $21.00 $20.38 $20.34 $19.98 $20.00 $19.55 $19.18 $19.17 $19.00 $18.70 $7.76 $8.12 $18.30 $7.40 $7.04 $17.80 $6.68 $18.00 $6.32 $17.27 $5.24 $5.60 $5.96 $4.

  11. Slide 11: TCPC Comparative Performance

    TCPC Comparative Performance Out-Performed the Wells Fargo BDC Index Total Return Performance(1) 200% 9/30/17: 87.2% 180% 160% 140% 120% 100% 80% 2012 2013 2014 2015 2016 2017 TCP Capital Corp. Wells Fargo Business Development Company Index (1) Assumes a fixed investment on April 6, 2012 in TCP Capi

  12. Slide 12: Investment Strategy & Focus

    Investment Strategy & Focus  Primarily current cash income with additional return from origination and structuring fees Return Focus  Potential capital appreciation  Potential upside through equity participation  Directly originated and newly originated leveraged loans and, to a lesser extent, s

  13. Slide 13: Multi-Channel Deal Sourcing

    Multi-Channel Deal Sourcing Extensive and diverse sourcing network designed to generate attractive investments across market cycles Industry / Sector Network Advisory Investor Relationships Reciprocal Credit Firm Board Relationships Middle-Market LBO Liquidators / Restructuring Firms Firms Appraiser

  14. Slide 14: Proven Investment Process

    Proven Investment Process Over 20 years,(1) Tennenbaum has developed a proven, repeatable investment process Rigorous Due Diligence & Investment Portfolio Realizations / Structuring Committee Management Liquidity  Comprehensive analysis of  Thorough due diligence,  Holistic approach  Focus on pr

  15. Slide 15: Middle-Market Credit Overview

    Middle-Market Credit Overview Middle-market lending is increasingly dominated by non-traditional lenders as banks continue a secular shift away from the market Why have banks retreated from the market? Regulatory Changes Consequences for Banks • Dodd Frank / Volcker Rule • Increased capital ratios a

  16. Slide 16: Case Study - Aircraft Financing Industry Expertise

    Case Study* - Aircraft Financing Industry Expertise (First to finance aircraft leases) Aircraft Financings * Case studies provide examples of investments made by TCPC and its investment process and approach. Not all investments following this process and approach have been profitable and there can b

  17. Slide 17: Case Study – Blackline Systems

    Case Study* – Blackline Systems (High Growth Software Company) Follow on Investments Initial Transaction Subsequent Investments Date of Investment September 2013 September 2015-2016 TCP Investment $25 million 11% LTV Incremental $35 million 1st Lien Term Loan with penny Security 1st Lien Term Loan w

  18. Slide 18: Case Study – KPC Healthcare, Inc.

    Case Study* – KPC Healthcare, Inc. (Regional California Hospital System) Repeat Borrower Initial Transaction 2nd Investment - Refinancing Date of Investment August 2015 February 2017 $55 million (par) (of $140 million $77 million (par) (of $77 million TCP Investment transaction) transaction) Securit

  19. Slide 19: Portfolio and Financial Review

    Portfolio and Financial Review

  20. Slide 20: Highly-Diversified Portfolio - Highlights as of September 30, 2017

    Highly-Diversified Portfolio - Highlights as of September 30, 2017  Largest investment is 3.0%; Five largest  $1.5 billion portfolio fair value investments are 13.6% Investment by Industry  11.0% weighted average effective yield on debt  97 Companies are floating rate portfolio(1) Retail 1.0% Ed

  21. Slide 21: Conservatively Positioned Portfolio

    Conservatively Positioned Portfolio As of September 30, 2017 Portfolio by Asset Type Debt Portfolio by Interest Type Leverage by Interest Type Mezzanine / Junior Debt <1% Equity 4% Fixed Rate 11% Floating rate 34% Fixed rate 66% Floating Rate 89% Senior Secured Debt 96% Positive annual impact on net

  22. Slide 22: Diversified Sources of Funding

    Diversified Sources of Funding As of September 30, 2017 Source Capacity Drawn Amount Available Pricing Maturity SVCP Revolver $116.0mm $30.0mm $86.0mm L + 2.50% Jul-18 (1) 2019 Convertible Senior Unsecured Notes $106.9mm $106.9mm - '5.25% Dec-19 (2) 2022 Convertible Senior Unsecured Notes $137.3mm $

  23. Slide 23: 2017 Highlights

    2017 Highlights  Out-earned our dividends by $0.18 per share over the last four quarters  Raised $93 million in equity through a follow-on offering  Closed $175 million private placement of 4.125% notes  Added new independent director, Kathleen Corbet  Board of Directors renewed our $50 million

  24. Slide 24: Conclusion

    Conclusion

  25. Slide 25: Key Highlights

    Key Highlights  Founded in 1996, inclusive of predecessor entity; Registered Investment Established Direct Advisor since 2001 Origination Platform  More than $18.5 billion invested in over 500 companies  Approximately $1.5 billion portfolio with a 10.95% effective yield on the debt(1)  Portfolio

  26. Slide 26: Appendix

    Appendix

  27. Slide 27: Financial Highlights

    Financial Highlights ($ per share) Q3 2017 Q2 2017 Q1 2017 Q4 2016 Q3 2016 Net investment income before taxes $ 0.47 $ 0.54 $ 0.47 $ 0.46 $ 0.49 Excise taxes - - - (0.01) - Incentive compensation on NII (0.09) (0.11) (0.09) (0.09) (0.10) Net investment income, after incentive(1) 0.38 0.43 0.38 0.36

  28. Slide 28: Portfolio Highlights

    Portfolio Highlights Asset Mix of the Investment Portfolio (in thousands) Q3 2017 Q2 2017 Q1 2017 Q4 2016 Q3 2016 Senior secured debt $ 1,463,295 $ 1,378,055 $ 1,273,608 $ 1,248,888 $ 1,221,182 Mezzanine/subordinated debt - - - - - Equity 65,455 67,893 64,902 66,082 55,248 Total investments 1,528,75

  29. Slide 29: Corporate Information

    Corporate Information Securities Listing Transfer Agent NASDAQ: TCPC Wells Fargo Shareholder Services (800) 468-9716 (from U.S.) Research Coverage (651) 450-4064 (from outside U.S.) www.shareowneronline.com  Wells Fargo  Bank of America Merrill Lynch  Citigroup Global Markets Corporate Headquarte

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