Trilinc Global Impact Fund Llc. · OTC:TRLC
Trilinc Global Impact Fund — Q1 2021 Earnings Presentation
41 slides from Trilinc Global Impact Fund's earnings presentation, May 19, 2021
Slide 1: Invest With Impact - Webinar Welcome
TRILINC GL@BAL INVEST WITH IMPACT We will begin at 11:00am PT (2:00pm ET). Thank you for joining us! TRILINC GLSBAL 1
Slide 2: TriLinc Global Impact Fund: Q1 2021 Update
TRILINC GL@BAL INVEST WITH IMPACT TRILINC GLOBAL IMPACT FUND: Q1 2021 UPDATE MAY 19, 2021
Slide 3: Disclaimer
This Presentation (the “Presentation”) is for informational purposes only, is being furnished on a highly confidential basis, and is intended solely for the persons receiving it; any reproduction or distribution is prohibited and illegal. This document does not constitute an offer of securities and
Slide 4: Portfolio Overview
PORTFOLIO OVERVIEW TRILINC GLSBAL 4
Slide 5: Private Debt Plus: Market Rate Returns + Positive Impact
▪ Private Debt Plus® = Market Rate Returns + Positive Impact ▪ International Private Credit Fund – Private Loans to Private Companies ▪ Designed to: ▪ Generate income ▪ Preserve capital ▪ Offer modest capital appreciation ▪ Create positive, measurable impact ▪ Also intended to be non-correlated with
Slide 6: Typical Investor Allocation
TYPICAL INVESTOR ALLOCATION1 Cash ▪ Liquidity Equity Fixed Income Alternatives Cash Fixed Income ▪ Capital preservation ▪ Income Equity ▪ Growth ▪ Some income Alternatives Debt Equity ▪ Liquidity ▪ Growth ▪ Capital preservation ▪ Non-correlation ▪ Non-correlation ▪ Sometimes Income For illustrative
Slide 7: Private vs Public Investments Dispersion
The wider array of value levers and risk drivers in private markets can result in greater performance dispersion vs. public markets. Private Sourcing Information Structuring & Use (or misuse) Negotiation of Leverage Valuation Asset Allocation Valuation Asset Allocation Private Investments Public Inv
Slide 8: $1.15 billion Invested to Date
$1.15 billion Trade finance, term loan, and short-term transactions in 88 Small & Mid-Sized Businesses supporting 40,427 Permanent jobs1 in 38 Developing economies2 0 Default Losses3 1) “Permanent Jobs” is self-reported by borrower companies, and is based on the IRIS Metric of Permanent Employees. 2
Slide 9: Portfolio Statistics
Total AUM $339.2 mil Full Cycle Loans $780 mil (68.8% of Total Invested) Weighted Average Portfolio Loan Size $8.1 mil Weighted Average Portfolio Duration < 2.0 years Cumulative Gross Portfolio Yield1 12.55% Leverage $5.0 mil USD Denominated 100%2 The performance information depicted above represent
Slide 10: Portfolio by Sector, Country, Region and Loan Type
Access to Healthcare and Pharmaceuticals Sector Access to Technology Country1 Argentina Botswana Inclusive Finance Brazil Cabo Verde Infrastructure Development Cameroon Chile Recycling Colombia Croatia Responsible Consumer Goods Production Ecuador Ghana Responsible Fuel Storage Guatemala Hong Kong R
Slide 11: Impact Objectives and ESG Screen Summary
Top 10 Impact Objectives1 ESG Screen Summary Productivity and Competitiveness, 27 Equality and Empowerment, 7 100% Adherence to the IFC Exclusion List Capacity Building, 23 Access to Financial Services, 6 100% Compliance with local environmental, labor, health, safety & business laws, standards and
Slide 12: NAV Discussion
NAV DISCUSSION TRILINC GLSBAL
Slide 13: NAV per Unit Price
TGIF Actual NAV vs. NAV w/out Effect of Unrealized Losses & Return of Capital (Q1 2018-Q1 2021) Q4 - 2013 NAVPer NAV PerUnit UnitPrice Price UnrealizedLoss Unrealized Effect Effect Return of Capital Return Effect of Capital Effect $8.573 $8.466 $8.421 $8.379 $8.355 $8.227 $8.166 $8.134 NAV per Unit
Slide 14: Distribution Rate as % of NAV
Distribution Rate as % of NAV (Q4 2017 – Q1 2021) Distribution Rate Net Asset Value 8.80% $380 8.57% 8.60% $370 8.40% $360 Net Asset Value (Millions) 8.16% 8.20% 8.09% Distribution Rate (%) 8.04% $350 8.00% 7.91% 7.83% 7.80% 7.72% $340 7.67% 7.57% 7.58% 7.60% 7.49% 7.48% $330 7.42% 7.43% 7.40% $320
Slide 15: NAV Effect of Return of Capital and Unrealized Adjustments
NAV Effect of Return of Capital ▪ If NAV declines from unrealized adjustments and distributions stay constant, NAV will decline further ▪ Quarters with high cash levels (therefore less income) and high OPEX also contribute to return of capital NAV Unrealized Adjustments ▪ Down ▪ Typically, non-perfo
Slide 16: Quarterly Valuation Process
Duff & Phelps Independent fair value review for all loans with a maturing of > 1 year Quarterly Quarterly Fair Value Valuation Valuation Memo Determination ▪Investment Partner Report ▪Valuation “valuation” inputs Committee ▪Audit Committee ▪Investment Team ▪CFO Prepares ▪Fund Board Assessment & Loan
Slide 17: A Deeper Dive on Unrealized Valuation Adjustments
A DEEPER DIVE ON UNREALIZED VALUATION ADJUSTMENTS TRILINC GLSBAL
Slide 18: Performing Loans and Troubled Loans
Performing Loans Troubled Loans 1. Loans Performing as Expected 3. Actual Performance Weakness ▪ May require loan restructuring 2. Potential Loan Weakness ▪ Change to key terms (weaker) ▪ Short Term (Forbearance – short term disruptions like COVID) 4. Non-Performing Loans (NPLs) ▪ Long Term – reprof
Slide 19: NPLs Since Inception
Number of Transactions Dollar Amount Total Invested Since Inception > $1.1 billion Total NPLs Since Inception2 17 ~$90.6 million NPLs “Rehabilitated” or Fully Paid3 4 ~$19.2 million Current NPLs4 15 ~$76.1 million ▪ IIG-Related 8 ~$41.7 million ▪ Non-IIG Related 7 ~$34.4 million 1) June 2013 2) Tota
Slide 20: NPLs at Q1 2021
NPLs at Q1 2021 Amortized Cost % of Portfolio Q1 Fair Value % of Portfolio Sesame Seed Exporter $ 881,800 0.29% $ 10,504 0.00% Beef Exporter $ 9,000,000 2.95% $ 6,361,679 2.08% Agriculture Distributor $ 12,500,000 4.09% $ 9,679,636 3.17% IIG TOF $ 6,000,000 1.97% $ 3,758,063 1.23% Chia Seed Exporter
Slide 21: Non-IIG and IIG Loan Updates
Non-IIG Loans ▪ LED Lighting Service Provider – technical EOD only ~$1.4mil ▪ Property Developer – began legal process ~$17.7mil ▪ Fruit & Nut Distributor – in full workout now ~$786k ▪ Pharmaceuticals Distributor – insurance claim ~$648k ▪ Mobile Phone Distributor – in liquidation $9.5mi ▪ Scrap Me
Slide 22: NPL Recovery Timeline Example
Total Amount Loaned $9,317,523 Principal Repayments before NPL $1,967,898 Interest Payments before NPL $197,159 Date of Default 10/19/2017 Principal Outstanding at DofD $7,349,626 Research and Legal Preparation Oct. 2017 – Mar. 2018 (6 mos) English Court Process Mar. 2018 filing, Jan. 2020 trial sta
Slide 23: TGIF Liquidation Strategy Discussion
TGIF LIQUIDATION STRATEGY DISCUSSION TRILINC GLSBAL
Slide 24: Board Review of Strategic Alternatives
• In late 2020, the TGIF Board hired a nationally recognized investment banking firm with an expertise in alternative investments and direct participation programs • Stanger was engaged to review and evaluate potential strategic alternatives for TGIF, including: o Listing o Merger o Liquidation o Ex
Slide 25: TGIF Performance
TGIF PERFORMANCE TRILINC GLSBAL
Slide 26: TGIF Gross Yields and Cash as % of AUM
TGIF Gross Yields 16.00% 14.00% Gross Yield (%) 12.00% ▪ GPY was relatively flat in Q1 at 12.90% 10.00% from 12.95% in Q4; AAY fell to 11.23% in 8.00% Q1 from 11.54% in Q4 6.00% 4.00% 2.00% 0.00% Quarter Gross Portfolio Yield Cumulative Gross Portfolio Yield AAY - Levered Cumulative AAY - Levered Ca
Slide 27: Total Distributions Since Inception
Since inception through 3/31/21, total distributions for TGIF have been: $143,389,684 Average net assets since inception through 3/31/21: $229,816,978 Total assets as of 3/31/2021: $367,069,257 Distributions reflect actual paid distributions for the period indicated. This metric is not a measure of
Slide 28: Starting NAV and Leverage Yield
Offering Price $10.00 Less Sales Commissions & O&O "load" ($1.43) – Blended Rate of all Share Classes "Starting" NAV $8.57 Net Yield from Leverage is designed to grow NAV to help make up the front end “load” The use of leverage can make investment performance more volatile. 28
Slide 29: Inception to Date Returns by Unit Class
Inception to Date A Units C Units I Units Average Annual Distribution (% of Offering Price) 7.35% 7.59% 8.12% Years since Inception x 7.75 7.75 7.75 Total Distributions 56.95% 58.85% 62.96% Offering Price x $10.00 $9.576 $9.186 $ of Distributions on Offering Price $5.70 $5.64 $5.78 Starting NAV afte
Slide 30: Net Internal Rate of Return
Since Inception Net IRR (Q4 2017 – Q1 2021) 8.00% 7.82% IIG 7.48% 7.50% 7.16% 7.18% Net Internal Rate of Return 7.00% 6.86% 6.79% 6.75% COVID-19 6.71% 6.55% 6.50% 6.28% 6.19% 6.13% 6.06% 6.02% 6.00% 5.50% 5.00% Q4 2017 Q1 2018 Q2 2018 Q3 2018 Q4 2018 Q1 2019 Q2 2019 Q3 2019 Q4 2019 Q1 2020 Q2 2020 Q
Slide 31: Volatility and Correlation
Volatility (Since Inception 9/30/13 – 3/31/21) Asset US Bonds1 Hedge Funds2 Global Stocks3 S&P 5004 TGIF5 Average Quarterly Returns (%) 0.58% 1.04% 2.74% 3.55% 1.90% Std. Deviation of Returns (%) 1.62% 3.07% 7.40% 7.23% 0.27% Sharpe Ratio6 -0.08 0.10 0.27 0.39 1.20 Average Annualized Returns (%) 2.3
Slide 32: Standard Deviation vs. Annual Returns
Standard Deviation vs. Annual Returns Period: Since Inception 9/30/13 – 3/31/2021 16.00% 14.00% S&P 500 (4) Average Annualized Returns (%) 12.00% Global Stocks (3) 10.00% 8.00% TriLinc Global Impact Fund (5) 6.00% 4.00% Hedge Funds (2) 2.00% US Bonds (1) 0.00% 0.00% 2.00% 4.00% 6.00% 8.00% 10.00% 12
Slide 33: Methodology and Footnotes
Methodology: The volatility and correlation analysis was conducted using quarterly returns (%) including TriLinc Global Impact Fund Since Inception Net IRR from each quarter. Average annualized returns (%) are displayed for reference and were calculated using average quarterly return (%) results. Th
Slide 34: Leverage Update
LEVERAGE UPDATE TRILINC GLSBAL 34
Slide 35: Levered AAY and the Leverage Effect
Levered AAY and the Leverage Effect (Q1 2016 – Q1 2021) Levered AAY Leverage Effect 12.60% 12.47%12.32% 11.99% 11.69%11.32%12.65% 13.55% 11.63% 11.34% 14.00% 0.12% 13.00% 0.45% 0.44% 0.10% 0.45% 0.03% 12.00% 0.08% 0.09% 0.11% Gross Yield (%) 0.09% 11.00% 10.00% 9.00% 8.00% 7.00% 6.00% Quarter ▪ Cont
Slide 36: Current Leverage Options Being Pursued
Current Options Being Pursued ▪ IFC A/B Loan ▪ Up to $175 million facility ▪ In late stages of re-approval ▪ U.S. Placement Agent ▪ Considered pre-IFC ▪ Leverage terms negotiated based on indicative rating ▪ In parallel to Specialty Finance Company as a fallback ▪ Other options also in various stage
Slide 37: Distribution Reinvestment Program Reopened
▪ Effective 5/29/20, the TGIF DRP program was reopened and available for investors1 ▪ DRP units are purchased at current NAV ▪ Opportunity to dollar cost average investment 1) Includes Unitholders who own Class A, Class C, Class I, Class W or Class Y Units. 37
Slide 38: Why TGIF Remains Attractive
▪ We believe that TGIF continues to be an attractive investment for clients, offering: ▪ Relative stable value ▪ High income ▪ Non-correlated ▪ Impact ▪ The TriLinc team continues to focus on maximizing value for investors, including increasing total returns and obtaining leverage for TGIF ▪ The Boa
Slide 39: TriLinc Leadership Team
Gloria Nelund: Chairman & CEO Brent L. VanNorman, Esq.: President ▪ Former CEO of $50 billion Deutsche Bank Private Wealth ▪ Experienced executive manager with over 25 years Management North America & former CEO of $35 billion Bank professional experience in law, accounting and business of America’s
Slide 40: Thank you!
If you have any additional questions, please feel free to reach out to TriLinc directly. Angie Miller AMiller@TriLincGlobal.com (602) 908-3417 TGIF Website: www.TrilincGlobalImpactFund.com Thank you! 40
Slide 41: Disclaimer
This Presentation (the “Presentation”) is for informational purposes only, is being furnished on a highly confidential basis, and is intended solely for the persons receiving it; any reproduction or distribution is prohibited and illegal. This document does not constitute an offer of securities and
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