Gladstone Capital Corporation · NASDAQ:GLAD
Gladstone Capital — Investor Presentation (June 2023)
16 slides from Gladstone Capital's investor presentation, Jun 30, 2023
Slide 1: Investor Presentation for the Fiscal Quarter Ended June 30, 2023
Investor Presentation for the Fiscal Quarter Ended June 30, 2023 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: − Gladstone Capital was founded in 2001 as 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 − Gladsto
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 to support a leveraged capital structure and favorable growth characteristics to deleverage risk profile Target
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 LMM companies typically sell for lower cash flow multiples, which translates into reduced financial leverage
Slide 7: 6/30/2023 Quarter Summary
Gladstone Capital 6/30/2023 Quarter Summary Originations/Portfolio Activity: Invested $53.5 million in three new portfolio companies and $17.1 million in existing portfolio companies. Repayments and net proceeds totaled $35.2 million, resulting in strong net originations of $35.4 million for the q
Slide 8: Origination Activity
Gladstone Capital Origination Activity Net originations of $35.4 million for the June 30, 2023 quarter continue to demonstrate healthy LMM momentum over the past year and market demand for one-stop 1st lien financing solutions. Gladstone Capital Quarterly Net Investment 6/30/2021 9/30/2021 12/31/2
Slide 9: Portfolio Trends
Gladstone Capital Portfolio Trends Originations have exceeded portfolio exits and refinancings for the past several quarters lifting portfolio net asset growth by over $125 million over the past twelve months. PE sponsor demand for unitranche financings has lifted 1st lien investments to 75% of
Slide 10: Portfolio Metrics
Portfolio Metrics Consistent with GLAD’s LMM focus, the core loan portfolio continues to represent companies with an average EBITDA of approx. $11.5 million and an average leverage attachment point of ~3.5x EBITDA *For the purposes of this presentation, certain investments have been excluded from th
Slide 11: Industry and Deal Sources Are Diversified
Industry and Deal Sources Are Diversified Portfolio Diversification Across 13 Deal Source Composition - Industries - At 6/30/2023 Fair Value At 6/30/2023 Fair Value Page 11
Slide 12: Portfolio Composition
Portfolio Composition Portfolio Characteristics As Of: September 30, 2022 December 31, 2022 March 31, 2023 June 30, 2023 Total Portfolio - FV $ 649,615 $ 621,739 $ 678,759 $ 715,324 # of Portfolio Companies 52 50 51 52 Average Investment Size - FV $ 12,493 $ 12,435 $ 13,309 $ 13,756 Top 5 Investment
Slide 13: Representative Portfolio Investments
Representative Portfolio Investments ANTENNA RESEARCH ASSOCIATES, INC. designs HH-INSPIRE ACQUISITION, INC. is a plastic and manufactures radio frequency based surgery and aesthetic center offering a antenna sub-systems and integrated antenna comprehensive range of cosmetic surgeries and systems for
Slide 14: Quarterly Financial Summary
Quarterly Financial Summary Three Months Ended In Thousands, except per share data June 30, 2022 September 30, 2022 December 31, 2022 March 31, 2023 June 30, 2023 Income: Interest Income $ 12,593 $ 15,567 $ 18,367 $ 19,578 $ 21,816 Other Investment Income 1,191 372 927 983 1,007 Total Investment Inc
Slide 15: 6/30/2023 Quarter Summary
Gladstone Capital 6/30/2023 Quarter Summary Capital Base and Liquidity Total Assets increased to $730 million as of June 30, 2023, consisting of $715 million in investments at fair value and $15 million in cash and other assets. Leverage as of June 30, 2023 decreased slightly with new investment
Slide 16: Corporate Data
Corporate Data Executive Officers Research Coverage Websites David Gladstone Janney Montgonery Scott LLC Gladstone Capital: Chairman & CEO John Rowan www.gladstonecapital.com Terry Lee Brubaker Jefferies Investment Adviser: COO Kyle Joseph www.gladstonemanagement.com Bob Marcotte Ladenburg Thalmann
Gladstone Capital — Investor Presentation (June 2023) on 6ix