Gladstone Investment Corporation - Business Development Company · NASDAQ:GAIN
Gladstone Investment Corporation - Business Development — Gladstone Investment — Q2 2023 Earnings Presentation
18 slides from Gladstone Investment Corporation - Business Development's earnings presentation, Sep 30, 2022
Slide 1: Quarterly Overview
GLADSTONE INVESTMENT Quarterly Overview September 30, 2022
Slide 2: Legal Disclaimer
Legal Disclaimer This presentation may include forward-looking statements. These forward-looking statements may involve known and unknown risks, uncertainties and other factors that may cause our actual results, levels of activity, performance or achievements to be materially different from any futu
Slide 3: Gladstone Investment Overview
Gladstone Investment | Overview(1) BDC differentiated through buyout investment strategy • Nasdaq symbol “GAIN” | market cap of $402 million Publicly traded business • 2026 Notes listed on Nasdaq under the symbol “GAINN,” with an interest rate of 5.00% development company • 2028 Notes listed on Nasd
Slide 4: Investment Highlights
Investment Highlights Leveraged buyout investor with history of increasing distributions and realizing capital gains Focus on Risk Management & Equity Value Creation 1 GAIN strives for prudent purchase multiples in companies with strong growth prospects. GAIN’s investment discipline and risk managem
Slide 5: Investment Focus and Process
Investment Focus and Process • Target stable lower middle market companies with EBITDA of $3 - 20 million • Investment size (debt & equity) generally up to $70 million (typically 25% equity & 75% debt) • Lead or co-lead prospective transactions Investment • Focused on cash-flow positive businesses w
Slide 6: Risk Management and Value Creation
Risk Management and Value Creation GAIN takes a long-term approach with a strategy to deploy debt & equity designed to streamline post-close value creation 1 2 Certainty and Speed to Close Investment Horizon No third-party capital required to Long term investment horizon as a close transactions, as
Slide 7: Upside Potential Driven by Focus on Equity Securities
Upside Potential Driven by Focus on Equity Securities • GAIN’s equity ownership provides further upside to shareholders through prospective capital gains and other income from successful exits which supports supplemental distributions from time to time • Since inception, GAIN has generated approxima
Slide 8: Successful Realizations Enhance Shareholder Value
Successful Realizations Enhance Shareholder Value History of exits generating significant capital gains. GAIN’s target investment mix of 75% debt and 25% equity provides potential for high returns through consistent current yield and capital appreciation at exit. $ in ‘000s Invested Capital (1) Equi
Slide 9: Growing Portfolio
Growing Portfolio From 3/31/2018 to 9/30/2022, we have: • Made investments in 11 new companies, deploying approximately $329 million of new capital (1) • Exited 16 companies, returning approximately $267 million(1) of invested capital and realizing approximately $186 million of net gains FYE March 3
Slide 10: Strong and Growing Monthly and Supplemental Distributions
Strong and Growing Monthly and Supplemental Distributions • From inception through 9/30/22, GAIN has paid 207 consecutive monthly distributions to common shareholders • GAIN’s regular annual distribution run-rate was increased 6.7% to $0.96 per common share in October 2022 • In addition to regular d
Slide 11: History of Driving High Shareholder Returns
History of Driving High Shareholder Returns Return on Equity Outperforming Industry Peers(1) Greater Total Return vs. BDC Peers(2) 280% 5 Year Total Return 35% 230% 92% 180% 30% 28% 130% +121% 26% 25% 80% 25% 23% (29)% 30% Sep-17 Sep-18 Sep-19 Sep-20 Sep-21 Sep-22 20% 190% 16% 3 Year Total Return 15
Slide 12: Financial Highlights
Financial Highlights Three Months Ended September 30, 2022 June 30, 2022 March 31, 2022 December 31, 2021 Total investment income $ 20,795 $ 19,297 $ 19,246 $ 16,742 Net investment income (loss) (NII/NIL) $ 11,416 $ 7,371 $ 6,730 $ 8,399 Adjusted NII(1) $ 9,747 $ 8,304 $ 8,723 $ 8,788 Realized gain
Slide 13: Financial Highlights (Non-GAAP Measure)
Financial Highlights (Non-GAAP Measure) Three Months Ended September 30, 2022 June 30, 2022 March 31, 2022 December 31, 2021 Amount Net investment income $ 11,416 $ 7,371 $ 6,730 $ 8,399 (+) Capital gains-based incentive fee (1,669) 933 1,993 389 Adjusted net investment income $ 9,747 $ 8,304 $ 8,72
Slide 14: Portfolio is Broad and Diversified
Portfolio is Broad and Diversified Manufacturing Business/Consumer Services Consumer Products 13
Slide 15: Geographic Diversification
Geographic Diversification 14
Slide 16: Why own Gladstone Investment's Common Stock?
Why own Gladstone Investment’s Common Stock? • Annual yield of approximately 6.9% as of November 9, 2022 Consistent Monthly • Increased regular monthly distributions annual run-rate by 28% since April 2016 to $0.96 per share as Distributions of October 2022 • Supplemental distributions to be made fr
Slide 17: Why own Gladstone Investment's Registered Notes?
Why own Gladstone Investment’s Registered Notes? • Annual interest rate ranging from 4.875% to 5% depending on the series with interest paid quarterly Strong Quarterly Interest • Strong coverage of interest: Adjusted NII(1) before interest expense for the 12 months ended September Strong Interest Co
Slide 18: Corporate Data
Corporate Data Key Executive Officers Research Coverage Websites David Gladstone Janney Gladstone Investment: Chairman & CEO John Rowan www.gladstoneinvestment.com Terry Lee Brubaker Jefferies & Company Vice Chairman & COO Investment Adviser: Kyle Joseph David Dullum www.gladstonemanagement.com Pres