Oaktree Specialty Lending Corporation · NASDAQ:OCSL
Oaktree Specialty Lending — Q1 2018 Earnings Presentation
14 slides from Oaktree Specialty Lending's earnings presentation, Feb 8, 2018
Slide 1: First Quarter Fiscal Year 2018 Earnings Presentation
First Quarter Fiscal Year 2018 Earnings Presentation February 8, 2018 Nasdaq: OCSL Exhibit 99.2
Slide 2: Forward Looking Statements
Forward Looking Statements Some of the statements in this presentation constitute forward-looking statements because they relate to future events or our future performance or financial condition. The forward-looking statements contained in this presentation may include statements as to: our future o
Slide 3: Q1 2018 Accomplishments & Highlights
Monetized $357 million of investments since September 30, 2017 $265 million in Q1 2018 and $92 million in January 2018 Full repayments of $197 million in 9 issuers; all repaid at par or at the call premium Sales of $68 million in 9 issuers; executed on average within 0.25% of 9/30/17 fair values Ent
Slide 4: Portfolio Summary
Portfolio Summary as of December 31, 2017 (As % of total portfolio, at fair value; $ in millions) (As % of total portfolio, at fair value) Portfolio Composition Top 10 Industries3 Portfolio Characteristics (at fair value) 1Liquid investments are investments that had publically quoted valuations. 2De
Slide 5: Portfolio Summary: Core vs. Non-core Assets
Portfolio Summary: Core vs. Non-core Assets $625 million (49% of the total portfolio at fair value) Average debt price: 100.1% Represents 42 companies $232 million of investments Oaktree originated or recommitted to since becoming investment adviser $106 million of investments in 5 issuers that Stra
Slide 6: Non-core: Performing Investments
Non-core: Performing Investments Investment Portfolio Characteristics $431 million – Debt investments at fair value $49 million – exited in January 2018 $61 million – publicly quoted liquid loans $321 million investments, a significant portion of which we expect to exit before 2019 Average debt pric
Slide 7: Non-core: Underperforming Investments
Non-core: Underperforming Investments Investments by Security Type Investment Portfolio Characteristics (As % of non-core underperforming investment portfolio, at fair value; $ in millions) $122 million of non-core, underperforming investments $41 million on non-accrual 9 Issuers Average debt price:
Slide 8: Q1 2018 Portfolio Originations
Q1 2018 Portfolio Originations $183 million of new commitments $175 million in 13 new portfolio companies and $8 million in 1 existing portfolio company 60% First lien 26% Second lien 14% Unsecured 12 industry sectors 8.7% weighted average yield at cost on company commitments One new co-investment w
Slide 9: Long-Term Portfolio Objectives
Long-Term Portfolio Objectives Diverse portfolio with evenly sized, high conviction investments in companies that are aligned with our approach to credit investing and have potential to generate attractive returns across market cycles Mix of sponsor and non-sponsor backed financings Industries which
Slide 10: Historical Financial Information
Historical Financial Information ($ in thousands, except per share data) Operating Results Q1’18 Q4’17 Q3'17 Q2'17 Q1'17 Dec-17 Sep-17 Jun-17 Mar-17 Dec-16 Net investment income $13,322 $11,464 $19,390 $18,504 $23,294 Net realized and unrealized depreciation on investments (43,763) (136,933) (25,447
Slide 11: Historical Portfolio Activity
Historical Portfolio Activity ($ in thousands) As of and for Three Months Ended Q1’18 Q4’17 Q3’17 Q2’17 Q1’17 Dec-17 Sep-17 Jun-17 Mar-17 Dec-16 Investments at Fair Value $1,415,404 $1,541,755 $1,790,540 $1,788,690 $1,951,740 Number of Portfolio Companies 122 125 133 133 123 Average Portfolio Compan
Slide 12: Capital Structure Optimization
Capital Structure Optimization Funding Sources as of December 31, 2017 Capacity Outstanding Interest Rate Maturity Syndicated Credit Facility $600.0 million $205.0 million LIBOR+225-275 bps November 2021 2019 Notes $250.0 million $250.0 million 4.875% March 2019 2024 Notes $75.0 million $75.0 millio
Slide 13: Opportunities to Increase Return on Equity
Opportunities to Increase Return on Equity Rotation out of broadly syndicated loans priced at LIBOR + 400 or below Redeploy non-income generating investments comprised of equity, limited partnership interests and loans on non-accrual Operating cost savings from leveraging Oaktree’s platform Deployme
Slide 14: Contact: Investor Relations
Contact: Michael Mosticchio, Investor Relations ocsl-ir@oaktreecapital.com
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