Blackrock Tcp Capital Corp. · NASDAQ:TCPC
Blackrock Tcp Capital — Raymond James Conference 2019
25 slides from Blackrock Tcp Capital's conference presentation, Mar 4, 2019
Slide 1: BlackRock TCP Capital Corp. Investor Presentation
BlackRock TCP Capital Corp. Investor Presentation March 2019
Slide 2: Forward Looking Statements
Forward Looking Statements Prospective investors considering an investment in BlackRock TCP Capital Corp. should consider the investment objectives, ris ks and expenses of the Company carefully before investing. This information and other information about the Company are available in the Company's
Slide 3: BlackRock TCP Capital Corp – Key Highlights
BlackRock TCP Capital Corp – Key Highlights As of December 31, 2018 Who we are What we do How we do it $1.6 billion diversified portfolio Advised by Tennenbaum Capital Value-oriented investing primarily composed of directly Partners (“TCP”) with a 20-year focused on middle-market originated senior s
Slide 4: Established Platform: TCP Now a Part of BlackRock Global Credit
Established Platform: TCP Now a Part of BlackRock Global Credit As of December 31, 2018 Experienced Advisor… …with Diverse Skills Complementary skill sets across direct lending More than 20 years (1) of experience investing and special situations enhance principal-protection through multiple market
Slide 5: Competitive Advantages of BlackRock
Competitive Advantages of BlackRock BlackRock’s $6.0 trillion(1) investment platform creates substantial scale and scope that seeks to provide insight, access, and expertise in sourcing and underwriting differentiated investment opportunities Global Credit Expertise Information Edge One Stop Shop ▪
Slide 6: Breadth and Depth of the BlackRock's Global Credit Platform
Breadth and Depth of the BlackRock’s Global Credit Platform Global Credit AUM: $93 billion(1) Leveraged Finance Multi-Strategy Credit Private Credit ▪ High Yield ▪ Pan-Credit Solutions ▪ Direct Lending ▪ Bank Loans ▪ Hedge Fund Strategies ▪ Opportunistic Credit ▪ CLOs ▪ Specialty Finance BlackRock I
Slide 7: Consistent and Disciplined Portfolio Growth
Consistent and Disciplined Portfolio Growth Total Investments = $1.6 billion Equity Fixed rate debt Floating rate debt $1,800 $1,600 $1,400 $1,200 Dollars in millions $1,000 $800 $600 $400 $200 $ Q2-12 Q4-12 Q2-13 Q4-13 Q2-14 Q4-14 Q2-15 Q4-15 Q2-16 Q4-16 Q2-17 Q4-17 Q2-18 Q4-18 7
Slide 8: Investor Friendly Advisory Fee Structure
Investor Friendly Advisory Fee Structure BlackRock TCP Capital Corp. BlackRock TCP Capital Corp. Average Externally Managed (Thru 2/8/2019) (Post 2/8/2019) BDC(1) 1.5% on gross assets (less cash 1.5% up to 1.0x debt to equity; 1.50% - 1.75% on gross assets and cash equivalents) 1.0% above 1.0x
Slide 9: Well-Covered and Consistent Dividend
Well-Covered and Consistent Dividend Net investment income of $0.40 per share Declared Q1 2019 dividend of $0.36 in Q4 2018 per share Quarterly dividend of $0.36 per share paid Payable on March 29, 2019 to holders of record on December 31, 2018 as of March 15, 2019 Dividend covered in all 27 quarter
Slide 10: Strong Track Record of Positive Performance
Strong Track Record of Positive Performance Book Value per Share and Dividends Paid Book Value per Share Cumulative Dividends Paid per Share (Post IPO) As of 12/31/2018: $26.00 $24.05 $24.00 $22.00 $20.00 $ 9.92 $18.00 $16.00 $14.76 $14.00 $12.00 $14.13 $10.00 At IPO Q3-12 Q1-13 Q3-13 Q1-14 Q3-14 Q1
Slide 11: TCPC Relative Outperformance
TCPC Relative Outperformance Outperformed the Wells Fargo BDC Index by 52% since our IPO(1) BlackRock TCP Capital Corp. Wells Far go Business Development Company Index 200% As of 12/31/2018 190% 180% 170% TCPC: 69.1% 160% 150% 140% WFBDC: 45.5% 130% 120% 110% 100% 90% (1) Assumes a fixed investment
Slide 12: Investment Strategy & Focus
Investment Strategy & Focus ▪ Seek to generate primarily current cash income with additional return from origination and structuring fees Return Focus ▪ Potential for capital appreciation ▪ Potential upside through equity participation ▪ Directly originated and newly originated leveraged loans and,
Slide 13: Multi-Channel Deal Sourcing
Multi-Channel Deal Sourcing Extensive and diverse sourcing network designed to generate attractive investments across market cycles Industry / Sector Network Investor Relationships Reciprocal Credit Firm Advisory Board Relationships BlackRock Private Capital C-suite Executives Middle-Market LBO Firm
Slide 14: Disciplined Investment Process
Disciplined Investment Process Industry deal teams are involved in every phase of a transaction from sourcing to eventual liquidity Rigorous Due Investment Portfolio Realizations / Diligence & Structuring Committee Management Liquidity ▪ Experienced credit ▪ Thorough review of due ▪ Holistic approac
Slide 15: TCPC's Risk-Mitigated Platform Well-Positioned in Today's Environment
TCPC’s Risk-Mitigated Platform Well-Positioned in Today’s Environment Middle-Market Environment Opportunities Challenges ▪ ~200,000(1) U.S. middle-market businesses, ▪ Uptick in new market participants is intensifying representing one-third of private sector GDP, many competition and pressuring yiel
Slide 16: Case Study: Nephron Pharmaceuticals – Pharmaceutical Manufacturer
Case Study: Nephron Pharmaceuticals – Pharmaceutical Manufacturer Key Terms Investment Type: 1st lien term loan Coupon: L + 8.75% Size: $180 million Floor Protection: 1.0% Primary Industry: Healthcare Call Protection: NC 1 Country: USA Price at Investment: 97.25 Sourcing • PNC had organized an earli
Slide 17: Case Study: Lexmark Carpet Mills – Manufacturing
Case Study: Lexmark Carpet Mills – Manufacturing Key Terms Investment Type: 1st Lien Term Loan Coupon: L + 10% Size: $76 million Floor Protection: 1.0% Primary Industry: Manufacturing Call Protection: 103/102/par Country: USA Price at Investment: 97.50 Sourcing • BlackRock (then TCP) supported the a
Slide 18: Conservatively Positioned and Diversified Portfolio
Conservatively Positioned and Diversified Portfolio Majority of our portfolio 11.4% weighted $1.6 billion 92% of portfolio companies contribute average effective yield portfolio fair value is senior secured debt <1% to recurring income on debt portfolio(1) Diversified Income Contribution Industry Di
Slide 19: Strategically Positioned Balance Sheet
Strategically Positioned Balance Sheet Predominantly Floating Rate Asset Portfolio Liabilities Primarily Fixed Rate 7% Fixed Rate 36% Fixed Rate Floating Rate Floating Rate 64% 93% Positive annual impact on net income of base rate increases in interest rates (1) Basis Point Change Net Investment Inc
Slide 20: Diversified Sources of Funding
Diversified Sources of Funding TCPC is investment grade rated by Standard & Poor’s and Moody’s As of December 31, 2018, $ in millions Source Capacity Drawn Amount Available Pricing Maturity SVCP 2022 Facility $ 170.0 $ 82.0 (4) $ 88.0 L + 2.25% Feb-22 2019 Convertible Notes 107.5 (1) 107.5 - 5.25% D
Slide 21: 2018 Highlights and Recent Achievements
2018 Highlights and Recent Achievements Asset Coverage ▪ TCPC’s Board of Directors and shareholders approved a decrease in the minimum asset Ratio coverage requirement from 200% to 150%, effective February 9, 2019 ▪ Lowered the base management fee rate on assets financed with leverage above 1.0x deb
Slide 22: Appendix
Appendix BLACKROCK’ 2 TCP eee"
Slide 23: Financial Highlights
Financial Highlights 2018 2017 Unaudited Unaudited ($ per share) Q4 Q3 Q2 Q1 Q4 Net investment income 0.40 0.42 0.41 0.37 0.41 Net realized & unrealized gains (losses) (0.42) (0.16) (0.34) 0.09 (0.18) Net increase in net assets from operations (0.02) 0.26 0.07 0.46 0.23 Dividend paid (0.36) (0.36) (
Slide 24: Portfolio Highlights
Portfolio Highlights 2018 2017 Asset Mix of the Investment Portfolio Q4 Q3 Q2 Q1 Q4 (in thousands) Senior secured debt $1,471,583 $ 1,433,044 $ 1,490,181 $ 1,505,586 $ 1,404,729 Junior debt 43,526 $ 43,277 $ 43,009 $ 42,750 $ 41,008 Equity 82,177 $ 83,792 $ 80,641 $ 72,052 $ 68,796 Total investments
Slide 25: Corporate Information
Corporate Information Securities Listing Transfer Agent NASDAQ: TCPC Equiniti Shareholder Services (800) 468-9716 (from U.S.) Research Coverage (651) 450-4064 (from outside U.S.) www.shareowneronline.com ▪ Bank of America Merrill Lynch ▪ D.A. Davidson Corporate Headquarters ▪ Deutsche Bank ▪ JMP Sec
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