Main Street Capital Corporation · NYSE:MAIN
Main Street Capital — IPO Roadshow (November 2022)
49 slides from Main Street Capital's IPO roadshow presentation, Nov 4, 2022
Slide 1: Investor Presentation Third Quarter 2022
mainstcapital.comNYSE: MAINMain Street Capital Corporation www.mainstcapital.com Page 1 Investor Presentation Third Quarter – 2022 Main St et Capital Corporation NYSE: IN mainstc ital.com Filed pursuant to Rule 433 Issuer Free Writing Prospectus dated November 4, 2022 Relating to Registration Statem
Slide 2: Disclaimers
mainstcapital.comNYSE: MAINMain Street Capital Corporation www.mainstcapital.com Page 2 Disclaimers Main Street Capital Corporation (MAIN) cautions that statements in this presentation that are forward-looking, and provide other than historical information, involve risks and uncertainties that may i
Slide 3: Corporate Overview and Investment Strategy
mainstcapital.comNYSE: MAINMain Street Capital Corporation www.mainstcapital.com Page 3 Main Street Capital Corporation Corporate Overview and Investment Strategy 3rd Quarter – 2022
Slide 4: MAIN is a Principal Investor in Private Debt and Equity
mainstcapital.comNYSE: MAINMain Street Capital Corporation www.mainstcapital.com Page 4 MAIN is a Principal Investor in Private Debt and Equity Hybrid debt and equity investment strategy, internally managed operating structure and focus on Lower Middle Market differentiates MAIN from other investmen
Slide 5: MAIN is a Principal Investor in Private Debt and Equity
mainstcapital.comNYSE: MAINMain Street Capital Corporation www.mainstcapital.com Page 5 MAIN is a Principal Investor in Private Debt and Equity Long-term focus on delivering our shareholders sustainable growth in net asset value and recurring dividends per share Consistent cash dividend yield – divi
Slide 6: MAIN is a Principal Investor in Private Debt and Equity
mainstcapital.comNYSE: MAINMain Street Capital Corporation www.mainstcapital.com Page 6 MAIN is a Principal Investor in Private Debt and Equity Equity investments in LMM portfolio provide the opportunity to both grow net asset value (NAV) per share and generate recurring dividend income and periodic
Slide 7: MAIN Strategy Produces Differentiated Returns
mainstcapital.comNYSE: MAINMain Street Capital Corporation www.mainstcapital.com Page 7 MAIN Strategy Produces Differentiated Returns Enhanced Value Proposition - Three Ways to Win are Better Than One 1. Sustain and Grow Dividends • Efficient operating structure provides operating leverage to grow D
Slide 8: Historical Monthly Dividends, NAV and DNII Per Share
mainstcapital.comNYSE: MAINMain Street Capital Corporation www.mainstcapital.com Page 8 Historical Monthly Dividends, NAV and DNII(1) Per Share MAIN’s unique focus on equity investments in the LMM provides the opportunity for significant NAV per share growth MAIN’s efficient operating structure prov
Slide 9: LMM Investment Strategy
mainstcapital.comNYSE: MAINMain Street Capital Corporation www.mainstcapital.com Page 9 LMM Investment Strategy Investment Objectives • High cash yield from secured debt investments (11.6% weighted- average cash coupon as of September 30, 2022); plus • Dividend income and periodic capital gains from
Slide 10: LMM Investment Opportunity
mainstcapital.comNYSE: MAINMain Street Capital Corporation www.mainstcapital.com Page 10 LMM Investment Opportunity Large and critical portion of U.S. economy • 195,000+ domestic LMM businesses(1) LMM is under-served from a capital perspective and less competitive Inefficient asset class generates p
Slide 11: Private Loan Investment Strategy
mainstcapital.comNYSE: MAINMain Street Capital Corporation www.mainstcapital.com Page 11 Private Loan Investment Strategy Investment Objectives • Access proprietary investments with attractive risk-adjusted return characteristics • Generate cash yield to support MAIN monthly dividend Investment Char
Slide 12: Middle Market Debt Investment Strategy
mainstcapital.comNYSE: MAINMain Street Capital Corporation www.mainstcapital.com Page 12 Middle Market Debt Investment Strategy Investment Objective • Generate cash yield to support MAIN monthly dividend Investments in secured and/or rated debt investments • First lien, senior secured debt investmen
Slide 13: Asset Management Business
mainstcapital.comNYSE: MAINMain Street Capital Corporation www.mainstcapital.com Page 13 Asset Management Business MAIN(1) is the investment adviser to and administrator of MSC Income Fund, Inc. (MSIF), a non-listed BDC • MAIN(1) provides asset management services, including sourcing, diligence and
Slide 14: MAIN Regulatory Framework
mainstcapital.comNYSE: MAINMain Street Capital Corporation www.mainstcapital.com Page 14 MAIN Regulatory Framework Operates as a Business Development Company • Regulated by Securities and Exchange Commission - 1940 Act • Publicly-traded, private investment company Regulated Investment Company (RIC)
Slide 15: MAIN Corporate Structure – Internally Managed
mainstcapital.comNYSE: MAINMain Street Capital Corporation www.mainstcapital.com Page 15 MAIN Corporate Structure – Internally Managed “Internally managed” structure means no external management fees or expenses are paid, providing operating leverage to MAIN’s business; MAIN targets total operating
Slide 16: MAIN Executive Management Team
mainstcapital.comNYSE: MAINMain Street Capital Corporation www.mainstcapital.com Page 16 MAIN Executive Management Team (1) Member of MAIN Executive Committee (2) Member of MAIN Investment Committee; Vince Foster, MAIN’s Chairman of the Board, is also a member of MAIN’s Investment Committee (3) Chie
Slide 17: Monthly Dividends Per Share – Sustainable Growth
mainstcapital.comNYSE: MAINMain Street Capital Corporation www.mainstcapital.com Page 17 Monthly Dividends Per Share – Sustainable Growth Recurring monthly dividend has never been decreased and has shown meaningful (105%) growth since IPO(1) Based upon the current annualized monthly dividends declar
Slide 18: Ordinary and Capital Gain Dividends 2017 – 2021
mainstcapital.comNYSE: MAINMain Street Capital Corporation www.mainstcapital.com Page 18 Ordinary and Capital Gain Dividends 2017 – 2021 MAIN’s unique investment strategy increases the tax efficiency of the dividends paid to our shareholders (1) A percentage of the amount included in the chart above
Slide 19: Investment Portfolio
mainstcapital.comNYSE: MAINMain Street Capital Corporation www.mainstcapital.com Page 19 Main Street Capital Corporation Investment Portfolio 3rd Quarter – 2022
Slide 20: Total Investment Portfolio
mainstcapital.comNYSE: MAINMain Street Capital Corporation www.mainstcapital.com Page 20 Total Investment Portfolio Includes complementary LMM debt and equity investments, Private Loan debt investments and Middle Market debt investments Total investment portfolio at fair value consists of approximat
Slide 21: Total Portfolio by Industry
mainstcapital.comNYSE: MAINMain Street Capital Corporation www.mainstcapital.com Page 21 Total Portfolio by Industry (as a Percentage of Cost)(1) (1) Excluding MAIN’s Other Portfolio investments, the External Investment Manager and short-term portfolio investments, each as described in MAIN’s public
Slide 22: Diversified Total Portfolio
mainstcapital.comNYSE: MAINMain Street Capital Corporation www.mainstcapital.com Page 22 Diversified Total Portfolio (as a Percentage of Cost)(1) Invested Capital by Transaction Type Invested Capital by Geography(2) 29% 15% 21% 14% 21% (1) Excluding MAIN’s Other Portfolio investments, the External I
Slide 23: LMM Investment Portfolio
mainstcapital.comNYSE: MAINMain Street Capital Corporation www.mainstcapital.com Page 23 LMM Investment Portfolio 75 portfolio companies / $1.9 billion in fair value • 48% of total investment portfolio at fair value Debt yielding 11.8%(1) (73% of LMM portfolio at cost) • 99% of debt investments have
Slide 24: LMM Investment Portfolio
mainstcapital.comNYSE: MAINMain Street Capital Corporation www.mainstcapital.com Page 24 LMM Investment Portfolio Median LMM portfolio credit statistics(1): • Senior leverage of 2.7x EBITDA through MAIN debt position • 2.8x EBITDA to senior interest coverage • Total leverage of 2.9x EBITDA including
Slide 25: LMM Portfolio by Industry
mainstcapital.comNYSE: MAINMain Street Capital Corporation www.mainstcapital.com Page 25 LMM Portfolio by Industry (as a Percentage of Cost)
Slide 26: Diversified LMM Portfolio
mainstcapital.comNYSE: MAINMain Street Capital Corporation www.mainstcapital.com Page 26 Diversified LMM Portfolio (as a Percentage of Cost) Invested Capital by Geography(1) 30% 22% 26% 12% 10% Invested Capital by Transaction Type (1) Based upon portfolio company headquarters 3% 30% 64% 3% LBO/MBO R
Slide 27: LMM Portfolio Attributes Reflect Investment Strategy
mainstcapital.comNYSE: MAINMain Street Capital Corporation www.mainstcapital.com Page 27 1st Lien 99% 1% Security Position on Debt Capital as a Percentage of Cost LMM Portfolio Attributes Reflect Investment Strategy High yielding secured debt investments coupled with significant equity participation
Slide 28: Term and Total Interest Coupon of Existing LMM Debt Investments
mainstcapital.comNYSE: MAINMain Street Capital Corporation www.mainstcapital.com Page 28 Total Interest Coupon(1) Term and Total Interest Coupon of Existing LMM Debt Investments Original Term (1) Interest coupon excludes amortization of deferred upfront fees, original issue discount, exit fees and a
Slide 29: Private Loan Investment Portfolio
mainstcapital.comNYSE: MAINMain Street Capital Corporation www.mainstcapital.com Page 29 Private Loan Investment Portfolio 87 investments / $1.5 billion in fair value • 37% of total investment portfolio at fair value Average investment size of $17.5 million(1) (less than 1% of total portfolio) Inves
Slide 30: Middle Market Investment Portfolio
mainstcapital.comNYSE: MAINMain Street Capital Corporation www.mainstcapital.com Page 30 Middle Market Investment Portfolio 33 investments / $354.3 million in fair value • 9% of total investment portfolio at fair value Average investment size of $12.7 million(1) (less than 1% of total portfolio) Inv
Slide 31: Private Loan & Middle Market Portfolios by Industry
mainstcapital.comNYSE: MAINMain Street Capital Corporation www.mainstcapital.com Page 31 Private Loan & Middle Market Portfolios by Industry (as a Percentage of Cost)
Slide 32: Diversified Private Loan & Middle Market Investments
mainstcapital.comNYSE: MAINMain Street Capital Corporation www.mainstcapital.com Page 32 Diversified Private Loan & Middle Market Investments (as a Percentage of Cost) Invested Capital by Transaction Type Invested Capital by Geography(1) 28% 10% 18% 14% 30% (1) Based upon portfolio company headquart
Slide 33: Financial Overview
mainstcapital.comNYSE: MAINMain Street Capital Corporation www.mainstcapital.com Page 33 Main Street Capital Corporation Financial Overview 3rd Quarter – 2022
Slide 34: MAIN Financial Performance
mainstcapital.comNYSE: MAINMain Street Capital Corporation www.mainstcapital.com Page 34 $205.7 $233.4 $243.4 $222.6 $289.0 $263.0 2017 2018 2019 2020 2021 YTD 2022 $0.0 $20.0 $40.0 $60.0 $80.0 $100.0 $120.0 $140.0 $160.0 $180.0 $200.0 $220.0 $240.0 $260.0 $280.0 $300.0 $145.6 $165.6 $168.3 $149.6 $
Slide 35: Long-Term Portfolio and DNII Per Share Growth
mainstcapital.comNYSE: MAINMain Street Capital Corporation www.mainstcapital.com Page 35 P or tfo lio In ve st m en ts D N II per S hare $106 $127 $159 $408 $658 $924 $1,286 $1,563 $1,800 $1,997 $2,171 $2,454 $2,602 $2,685 $3,562 $3,973 $0.76 $1.19 $1.02 $1.25 $1.77 $2.09 $2.17 $2.29 $2.31 $2.39 $2.
Slide 36: Efficient and Leverageable Operating Structure
mainstcapital.comNYSE: MAINMain Street Capital Corporation www.mainstcapital.com Page 36 Efficient and Leverageable Operating Structure “Internally managed” structure means no external management fees or expenses are paid Alignment of interest between management and investors • Greater incentives to
Slide 37: MAIN Maintains a Significant Operating Cost Advantage
mainstcapital.comNYSE: MAINMain Street Capital Corporation www.mainstcapital.com Page 37 0.0% 0.5% 1.0% 1.5% 2.0% 2.5% 3.0% MAIN Maintains a Significant Operating Cost Advantage (1) Total expenses excluding interest expense (2) For the trailing twelve month period ended September 30, 2022 (3) For th
Slide 38: MAIN Income Statement Summary
mainstcapital.comNYSE: MAINMain Street Capital Corporation www.mainstcapital.com Page 38 MAIN Income Statement Summary (1) Positive percentage represents an increase and negative percentage represents a decrease to the Net Increase (Decrease) in Net Assets (2) Excludes non-cash compensation expenses
Slide 39: MAIN Per Share Change in Net Asset Value
mainstcapital.comNYSE: MAINMain Street Capital Corporation www.mainstcapital.com Page 39 MAIN Per Share Change in Net Asset Value (NAV) (1) See reconciliation of non-cash compensation expenses and DNII per share to Net Investment Income per share on page 38 and Non-GAAP Information disclosures on pa
Slide 40: MAIN Balance Sheet Summary
mainstcapital.comNYSE: MAINMain Street Capital Corporation www.mainstcapital.com Page 40 MAIN Balance Sheet Summary (1) Includes $500.0 million of 3.00% Notes due July 2026, $450.0 million of 5.20% Notes due May 2024 and $185.0 million of 4.50% Notes due December 2022 ($ in 000's, except per share a
Slide 41: MAIN Liquidity and Capitalization
mainstcapital.comNYSE: MAINMain Street Capital Corporation www.mainstcapital.com Page 41 MAIN Liquidity and Capitalization (1) As of September 30, 2022, MAIN’s Credit Facility had $920.0 million in total commitments with an accordion feature with the right to request an increase up to $1.4 billion;
Slide 42: Stable, Long-Term Leverage – Significant Unused Capacity
mainstcapital.comNYSE: MAINMain Street Capital Corporation www.mainstcapital.com Page 42 Stable, Long-Term Leverage – Significant Unused Capacity MAIN maintains a conservative capital structure, with limited overall leverage and low cost, long-term debt Capital structure is designed to correlate to
Slide 43: Long-term Maturity of Debt Obligations
mainstcapital.comNYSE: MAINMain Street Capital Corporation www.mainstcapital.com Page 43 (in m ill io ns ) $16.0 $63.8 $75.0 $75.0 $35.0 $85.2 $561.0 $185.0 $450.0 $500.0 SBIC debentures Credit Facility 4.50% Notes due 2022 5.20% Notes due 2024 3.00% Notes due 2026 2022 2023 2024 2025 2026 2027 2028
Slide 44: Interest Rate Impact and Sensitivity
mainstcapital.comNYSE: MAINMain Street Capital Corporation www.mainstcapital.com Page 44 Interest Rate Impact and Sensitivity The following table illustrates the approximate annual changes in the components of MAIN’s net investment income due to hypothetical increases (decreases) in interest rates(1
Slide 45: Significant Management Ownership / Investment
mainstcapital.comNYSE: MAINMain Street Capital Corporation www.mainstcapital.com Page 45 Significant Management Ownership / Investment Significant equity ownership by MAIN’s management team, coupled with internally managed structure, provides alignment of interest between MAIN’s management and our s
Slide 46: MAIN Total Return Performance Since IPO
mainstcapital.comNYSE: MAINMain Street Capital Corporation www.mainstcapital.com Page 46 Notes: (1) Assumes dividends reinvested on date paid (2) The Main Street Peer Group includes all BDCs that have been publicly-traded for at least one year and that have total assets greater than $500 million bas
Slide 47: Executive Summary
mainstcapital.comNYSE: MAINMain Street Capital Corporation www.mainstcapital.com Page 47 Executive Summary Unique focus on under-served Lower Middle Market • Inefficient asset class with less competition • Unique market opportunity with attractive risk-adjusted returns • Generally first lien, senior
Slide 48: Non-GAAP Information
mainstcapital.comNYSE: MAINMain Street Capital Corporation www.mainstcapital.com Page 48 Non-GAAP Information Distributable net investment income is net investment income as determined in accordance with U.S. Generally Accepted Accounting Principles, or U.S. GAAP, excluding the impacts of non-cash c
Slide 49: MAIN Corporate Data
mainstcapital.comNYSE: MAINMain Street Capital Corporation www.mainstcapital.com Page 49 MAIN Corporate Data Board of Directors Vincent D. Foster Chairman of the Board Main Street Capital Corporation Board of Directors Quanta Services, Inc. J. Kevin Griffin Chief Strategy Officer MaineHealth Dwayne