Pennantpark Investment Corporation · NYSE:PNNT
Pennantpark Investment — Q3 2020 Earnings Presentation
15 slides from Pennantpark Investment's earnings presentation, Aug 7, 2020
Slide 1: NEW YORK CHICAGO HOUSTON
06/30/2020 NEW YORK • CHICAGO • HOUSTON • LOS ANGELES
Slide 2: Forward-looking Statements and Risk Factors
Forward-looking Statements and Risk Factors This presentation may include forward-looking statements. These forward-looking statements include comments with respect to our objectives and strategies and results of our operations. However, by their nature, these forward-looking statements involve nume
Slide 3: Established Credit Platform
Established Credit Platform $3.6 billion total Assets Under Management Established Investment Platform • PennantPark Investment Advisers founded 13 years ago before the Global Financial Crisis – NASDAQ: “PNNT” – NASDAQ: “PFLT” • Deep expertise in middle market direct – IPO Date: April 2007 – IPO Dat
Slide 4: Established Credit Platform
Established Credit Platform Founded in 2007 Funded $11B in 544 companies Disciplined Investor Relationship & Solution Driven Consistent Performance & Conservative Portfolio Track Record Construction • Value oriented with • Team approach • Low volatility of • 86 companies in 30 different goal of capi
Slide 5: Third Quarter 2020 Highlights
Third Quarter 2020 Highlights Joint venture with leading private NetExperienced Asset Value Adjusted NAV (excluding MTM of liabilities) PSLF markets investor, Pantheon, reduces increased 7% to $7.46 from $6.97 prior debt by $245 million Team quarter Regulatory net debt to equity ration, Expansive Ne
Slide 6: Why is PNNT Well Positioned?
Why is PNNT Well Positioned? • Decades of experience in middle market sponsor-driven direct lending Experienced Experienced Team • Stable, consistent investment team • Headquarters in New York with offices in Los Angeles, Chicago, and Houston Team • Independent Expansive Relationship • Established i
Slide 7: Underwriting Philosophy & Process
Underwriting Philosophy & Process Investment Philosophy Capital preservation is paramount Companies with positive cash flow (in order to de-risk) Companies owned by reputable financial sponsors with track records supporting portfolio companies Run by experienced management teams with capability to p
Slide 8: PNNT Has a Compelling Track Record
PNNT Has a Compelling Track Record Portfolio growth has been measured and consistent with market opportunity $689 million of dividends paid to shareholders since inception – To date, dividends paid to shareholders are approximately 85% of equity capital raised1 Low loss experience: approximately 24
Slide 9: Overall Portfolio as of 6/30/20
Overall Portfolio as of 6/30/20 Highly Diversified Industry Mix Portfolio Overview 86 different companies Other(1), 15% Healthcare, Education Average investment size: $15.5 million and Childcare, 16% Yield at Cost on Debt Portfolio: 8.7% 77% Secured Debt Personal, Food and Miscellaneous Services, 3%
Slide 10: Benefits of SBIC Subsidiary
Benefits of SBIC Subsidiary Long-term funding – 10-year SBA non-recourse debentures – Does not use mark-to-market accounting Up to 2x leverage at SBIC subsidiary – Remaining $134 million long-term financing Attractive pricing: all-in ten-year fixed-rate of 3.1% on SBA financed vehicle Diversifies fu
Slide 11: PennantPark Senior Loan Fund, LLC ("PSLF")
PennantPark Senior Loan Fund, LLC (“PSLF”) Invests in primarily middle market, directly originated first lien loans $381 million of total capacity, today Total commitments of $131 million in notes and equity from PNNT and Pantheon Ventures Up to $250 million of third party debt financing Expands abi
Slide 12: Diversified Funding Sources
Diversified Funding Sources 06/30/2020 Commitment Amount ($mm) Interest Rate Maturity Date BNP Revolving Credit Facility $250 2.8% 2/22/24 Truist Revolving Credit Facility 475 2.5 9/4/24 SBIC II 134 3.11 3/1/26 - 3/1/281 2024 Notes 86 5.5 10/15/24 Total $945 4.2% 1. Across all SBIC II debentures. 12
Slide 13: Selected Financial Highlights - PNNT
Selected Financial Highlights - PNNT September December March June ($mm, except per share data) Q4 2019 Q1 2020 Q2 2020 Q3 2020 Investment Portfolio (at fair value) $1,219 $1,379 $1,354 $1,333 Debt (Regulatory) $538 $620 $769 $745 Debt (GAAP) $684 $743 $847 $848 GAAP Net Assets $582 $589 $517 $524 A
Slide 14: Strategy Targeted to Deliver Returns
Strategy Targeted to Deliver Returns Extensive and diverse sourcing network Focused on companies with strong free cash flow and de-leveraging capabilities Value oriented with a goal of capital preservation Privately negotiated middle market loans provide attractive risk/return Returns driven by inte
Slide 15: PNNT Selected Investments
PNNT Selected Investments Revolver Revolver Second Lien Secured Debt Revolver First Lien Secured Debt First Lien Secured Loan Equity First Lien Term Loan Equity Equity InTandem Capital Francisco Partners Staple Street Capital Yellow Wood Partners Revolver Revolver Second Lien Secured Debt Revolver F
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