Gladstone Capital Corporation · NASDAQ:GLAD
Gladstone Capital — Investor Presentation (June 2021)
16 slides from Gladstone Capital's investor presentation, Jun 30, 2021
Slide 1: Investor Presentation for the Fiscal Quarter Ended June 30, 2021
Investor Presentation for the Fiscal Quarter Ended June 30, 2021 FINANCING FOR LOWER MIDDLE-MARKET COMPANIES
Slide 2: Legal Disclaimer
Legal Disclaimer Forward-Looking Statements: This presentation may include “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. These forward-looking statements may include commen
Slide 3: Gladstone Capital Overview
Gladstone Capital Overview Background: − Founded in 2001, Gladstone Capital was one of the first business development companies (BDC) focused on making loans to lower middle market U.S. businesses ($3-15MM of EBITDA) and today the investment team remains dedicated to the BDC’s activities and perform
Slide 4: Why Invest in a BDC?
Why Invest in a BDC? BDCs are regulated by the SEC, which mandates asset diversity, investor transparency via quarterly SEC filings including fair value adjustments of all assets and limits financial leverage to a maximum of 2:1 debt to equity leverage. BDCs typically operate as regulated investment
Slide 5: Strategy and Risk Management
Gladstone Capital Strategy and Risk Management Investment Strategy: Originate secured debt investments in established lower middle market companies with sustainable margins/cash flows and favorable growth characteristics, which can support a leveraged capital structure Target companies with oper
Slide 6: Attractive Lower Middle Market Dynamics
Attractive Lower Middle Market Dynamics Why we target lower middle market (“LMM”) companies Greater industry diversity and more consistent flow of growth-oriented investment opportunities across the vast array of U.S. based businesses Lower middle market companies typically sell for lower cash f
Slide 7: 6/30/2021 Quarter Summary
Gladstone Capital 6/30/2021 Quarter Summary Originations/Portfolio Activity: Invested $53.2 million during the quarter, including three new proprietary debt investments in the consumer products, healthcare, and energy sectors. Repayments and net proceeds totaled $54.4 million, including the repa
Slide 8: Origination Activity
Gladstone Capital Origination Activity Origination levels continue to outpace elevated refinancing activity for the LTM period. Weighted average yield was 10 bps lower due to increased proportion of 1st lien loans. Gladstone Capital Quarterly Net Investment 6/30/2019 9/30/2019 12/31/2019 3/31/20
Slide 9: Portfolio Trends
Gladstone Capital Portfolio Trends Net originations over the last four quarters of $17 million were driven by PE sponsor demand for flexible first lien/unitranche financing, partially offset by elevated repayment and exit activity. The bulk of the prepayments were second lien investments, contri
Slide 10: Portfolio Metrics
Portfolio Metrics GLAD’s core loan portfolio* has an average EBITDA of $10.5 million and consists of 74% in first lien and 26% in second lien loans and an average leverage multiple of 3.3x EBITDA *For the purposes of this presentation, the core loan portfolio excludes certain investments: (i) Broadl
Slide 11: Industry and Deal Sources Are Diversified
Industry and Deal Sources Are Diversified Portfolio Diversification Across 17 Deal Source Composition - Industries - At 6/30/2021 Fair Value At 6/30/2021 Fair Value Page 11
Slide 12: Portfolio Composition
Portfolio Composition Portfolio Characteristics As Of: September 30, 2020 December 31, 2020 March 31, 2021 June 30, 2021 Total Portfolio - FV $ 450,400 $ 452,359 $ 492,767 $ 506,372 # of Portfolio Companies 48 47 47 47 Average Investment Size - FV $ 9,383 $ 9,625 $ 10,484 $ 10,774 Top 5 Investments
Slide 13: Representative Portfolio Investments
Representative Portfolio Investments Page 13
Slide 14: Quarterly Financial Summary
Quarterly Financial Summary Three Months Ended In Thousands, except per share data September 30, 2020 December 31, 2020 March 31, 2021 June 30, 2021 Income: Interest Income $ 11,935 $ 12,082 $ 11,886 $ 12,746 Other Investment Income 644 800 999 920 Total Investment Income 12,579 12,882 12,885 13,666
Slide 15: 6/30/2021 Quarter Summary
Gladstone Capital 6/30/2021 Quarter Summary Capital Base and Liquidity Liabilities declined to $222 million as of 6/30/2021, consisting primarily of $150 million of 5.125% senior notes due 2026 and $38.8 million of 5.375% senior notes due 2024. Advances under our floating rate bank line of credit
Slide 16: Corporate Data
Corporate Data Executive Officers Research Coverage Websites David Gladstone Gladstone Capital: Chairman & CEO Ladenburg Thalmann www.gladstonecapital.com Terry Lee Brubaker Mickey Schleien Investment Adviser: Vice Chairman & COO www.gladstonemanagement.com Wedbush Securities Bob Marcotte Henry J Co
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