Le Lézard
Classified in: Business, Covid-19 virus
Subjects: EARNINGS, Conference Call, Webcast

Goldman Sachs BDC, Inc. Reports June 30, 2020 Financial Results and Announces Quarterly Dividend of $0.45 Per Share


Goldman Sachs BDC, Inc. ("GSBD" or the "Company") (NYSE: GSBD) today reported financial results for the second quarter ended June 30, 2020 and filed its Form 10-Q with the U.S. Securities and Exchange Commission.

QUARTERLY HIGHLIGHTS

UPDATES TO PREVIOUSLY ANNOUNCED MERGER

SELECTED FINANCIAL HIGHLIGHTS

(in $ millions, except per share data)

 

As of
June 30, 2020

 

 

As of
March 31, 2020

Investment portfolio, at fair value2

 

$

1,424.5

 

 

$

1,422.7

Total debt outstanding3

 

$

918.5

 

 

$

917.8

Net assets

 

$

611.5

 

 

$

594.9

Net asset value per share

 

$

15.14

 

 

$

14.72

 

 

 

Three Months Ended
June 30, 2020

 

 

Three Months Ended
March 31, 2020

Total investment income

 

$

30.6

 

 

$

32.0

Net investment income after taxes

 

$

18.2

 

 

$

18.2

Net increase in net assets resulting from operations

 

$

34.8

 

 

$

(63.8)

Net investment income per share (basic and diluted)

 

$

0.45

 

 

$

0.45

Earnings (loss) per share (basic and diluted)

 

$

0.86

 

 

$

(1.58)

Regular distribution per share

 

$

0.45

 

 

$

0.45

INVESTMENT ACTIVITY2

During the three months ended June 30, 2020, new investment commitments and fundings were $0.5 million and $0.0 million, respectively, including net fundings of $(0.6) million in unfunded prior commitments. The new investment commitments were across one new portfolio company and one existing portfolio company. New investment commitments were comprised of 100% first lien debt investments. The Company had sales and repayments of $18.3 million primarily driven by the full repayment of an investment in one portfolio company.

Summary of Investment Activity for the three months ended June 30, 2020 was as follows:

 

 

New Investment Commitments

 

 

Sales and Repayments

 

Investment Type

 

$ Millions

 

 

% of Total

 

 

$ Millions

 

 

% of Total

 

1st Lien/Senior Secured Debt

 

$

0.5

 

 

 

100.0

%

 

$

7.7

 

 

 

42.1

%

1st Lien/Last-Out Unitranche

 

 

?

 

 

 

?

 

 

 

0.1

 

 

 

0.6

 

2nd Lien/Senior Secured Debt

 

 

?

 

 

 

?

 

 

 

10.0

 

 

 

54.6

 

Unsecured Debt

 

 

?

 

 

 

?

 

 

 

0.5

 

 

 

2.7

 

Total

 

$

0.5

 

 

 

100.0

%

 

$

18.3

 

 

 

100.0

%

PORTFOLIO SUMMARY2

As of June 30, 2020, the Company's investment portfolio consisted of the following:

 

 

Investments at Fair Value

 

Investment Type

 

$ Millions

 

 

% of Total

 

1st Lien/Senior Secured Debt

 

$

1,080.7

 

 

 

75.9

%

1st Lien/Last-Out Unitranche

 

 

34.8

 

 

 

2.4

 

2nd Lien/Senior Secured Debt

 

 

205.4

 

 

 

14.4

 

Unsecured Debt

 

 

7.2

 

 

 

0.5

 

Preferred Stock

 

 

59.8

 

 

 

4.2

 

Common Stock

 

 

36.6

 

 

 

2.6

 

Total

 

$

1,424.5

 

 

 

100.0

%

The following table presents certain selected information regarding the Company's investment portfolio:

 

 

As of

 

 

 

June 30, 2020

 

 

March 31, 2020

 

Number of portfolio companies

 

 

107

 

 

 

 

107

 

Percentage of performing debt bearing a floating rate4

 

 

98.7

%

 

 

 

98.5

%

Percentage of performing debt bearing a fixed rate4

 

 

1.3

%

 

 

 

1.5

%

Weighted average yield on debt and income producing investments, at amortized cost5

 

 

8.3

%

 

 

 

8.5

%

Weighted average yield on debt and income producing investments, at fair value5

 

 

10.2

%

 

 

 

10.7

%

Weighted average leverage (net debt/EBITDA)6

 

5.4x

 

 

 

5.6x

 

Weighted average interest coverage6

 

2.7x

 

 

 

2.6x

 

Median EBITDA6

$

37.92 million

 

 

$

37.83 million

 

As of June 30, 2020, investments on non-accrual status represented 0.1% and 0.9% of the total investment portfolio at fair value and amortized cost, respectively.

RESULTS OF OPERATIONS

Total investment income for the three months ended June 30, 2020 and March 31, 2020 was $30.6 million and $32.0 million, respectively. The decrease in investment income was primarily driven by a decrease in interest income due to a decrease in LIBOR. The $30.6 million of total investment income was comprised of $30.0 million from interest income, original issue discount accretion, payment-in-kind income and dividend income, $0.3 million from prepayment-related income and $0.3 million from other income.7

Net expenses before taxes for the three months ended June 30, 2020 and March 31, 2020 were $12.0 million and $13.4 million, respectively. The $1.4 million decrease in expenses was primarily driven by the voluntary management fee waiver. The $12.0 million of net expenses before taxes were comprised of $9.1 million of interest and other debt expenses, $1.5 million of net management fees, and $1.4 million of other operating expenses.

Net investment income after taxes for the three months ended June 30, 2020 was $18.2 million, or $0.45 per share, as compared with $18.2 million, or $0.45 per share for the three months ended March 31, 2020.

During the three months ended June 30, 2020, the Company had net realized and unrealized gains (losses) of $16.6 million, primarily driven by credit spread tightening.

Net increase in net assets resulting from operations for the three months ended June 30, 2020 was $34.8 million, or $0.86 per share.

LIQUIDITY AND CAPITAL RESOURCES

As of June 30, 2020, the Company had $918.5 million of total principal amount of debt outstanding, comprised of $403.5 million of outstanding borrowings under its senior secured revolving credit facility, $155.0 million of unsecured convertible notes and $360.0 million of unsecured notes. The combined weighted average interest rate on debt outstanding was 3.29% for the three months ended June 30, 2020. As of June 30, 2020, the Company had $391.7 million of availability under its senior secured revolving credit facility and $105.8 million in cash and cash equivalents.3,8

The Company's ending net debt to equity leverage ratio was 1.33x as of June 30, 2020, as compared to 1.40x as of March 31, 2020.9

CONFERENCE CALL

The Company will host an earnings conference call on Tuesday, August 11, 2020 at 9:00 am Eastern Time. All interested parties are invited to participate in the conference call by dialing (866) 884-8289; international callers should dial +1 (631) 485-4531; conference ID 3895223. All participants are asked to dial in approximately 10-15 minutes prior to the call, and reference "Goldman Sachs BDC, Inc." when prompted. For a slide presentation that the Company may refer to on the earnings conference call, please visit the Investor Resources section of the Company's website at www.goldmansachsbdc.com. The conference call will be webcast simultaneously on the Company's website. An archived replay of the call will be available from approximately 12:00pm Eastern Time on August 11, 2020 through September 11, 2020. To hear the replay, participants should dial (855) 859-2056; international callers should dial +1 (404) 537-3406; conference ID 3895223. An archived replay will also be available on the Company's webcast link located on the Investor Resources section of the Company's website.

Please direct any questions regarding the conference call to Goldman Sachs BDC, Inc. Investor Relations, via e-mail, at gsbdc-investor-relations@gs.com.

ENDNOTES

  1. The $0.45 per share dividend is payable on October 15, 2020 to shareholders of record as of September 30, 2020.

  2. The discussion of the investment portfolio of the Company excludes its investment in a money market fund managed by an affiliate of The Goldman Sachs Group, Inc. As of June 30, 2020, the Company's investment in the money market fund was $89.5 million.

  3. Total debt outstanding excludes netting of debt issuance costs of $9.2 million and $9.7 million, respectively, as of June 30, 2020 and March 31, 2020.

  4. The fixed versus floating composition has been calculated as a percentage of performing debt investments measured on a fair value basis, including income producing stock investments and excludes investments, if any, placed on non-accrual.

  5. Computed based on the (a) annual actual interest rate or yield earned plus amortization of fees and discounts on the performing debt and other income producing investments as of the reporting date, divided by (b) the total performing debt and other income producing investments (excluding investments on non-accrual) at amortized cost or fair value, respectively. This calculation excludes exit fees that are receivable upon repayment of the loan.

  6. For a particular portfolio company, we calculate the level of contractual indebtedness net of cash ("net debt") owed by the portfolio company and compare that amount to measures of cash flow available to service the net debt. To calculate net debt, we include debt that is both senior and pari passu to the tranche of debt owned by us but exclude debt that is legally and contractually subordinated in ranking to the debt owned by us. We believe this calculation method assists in describing the risk of our portfolio investments, as it takes into consideration contractual rights of repayment of the tranche of debt owned by us relative to other senior and junior creditors of a portfolio company. We typically calculate cash flow available for debt service at a portfolio company by taking net income before net interest expense, income tax expense, depreciation and amortization ("EBITDA") for the trailing twelve month period. Weighted average net debt to EBITDA is weighted based on the fair value of our debt investments and excludes investments where net debt to EBITDA may not be the appropriate measure of credit risk, such as cash collateralized loans and investments that are underwritten and covenanted based on recurring revenue.

    For a particular portfolio company, we also calculate the level of contractual interest expense owed by the portfolio company, and compare that amount to EBITDA ("interest coverage ratio"). We believe this calculation method assists in describing the risk of our portfolio investments, as it takes into consideration contractual interest obligations of the portfolio company. Weighted average interest coverage is weighted based on the fair value of our performing debt investments and excluding investments where interest coverage may not be the appropriate measure of credit risk, such as cash collateralized loans and investments that are underwritten and covenanted based on recurring revenue.

    Median EBITDA is based on our debt investments and excludes investments where net debt to EBITDA may not be the appropriate measure of credit risk, such as cash collateralized loans and investments that are underwritten and covenanted based on recurring revenue.

    Portfolio company statistics are derived from the financial statements most recently provided to us of each portfolio company as of the reported end date. Statistics of the portfolio companies have not been independently verified by us and may reflect a normalized or adjusted amount. As of June 30, 2020 and March 31, 2020, investments where net debt to EBITDA may not be the appropriate measure of credit risk represented 29.2% and 29.2%, respectively, of total debt investments at fair value. Portfolio company statistics have not been independently verified by us and may reflect a normalized or adjusted amount.

  7. Interest income excludes prepayment premiums, accelerated accretion of upfront loan origination fees and unamortized discounts. Prepayment related income includes prepayment premiums and accelerated accretion of upfront loan origination fees and unamortized discounts.

  8. The Company's revolving credit facility has debt outstanding denominated in currencies other than U.S. Dollars ("USD"). These balances have been converted to USD using applicable foreign currency exchange rates as of June 30, 2020. As a result, the revolving credit facility's outstanding borrowings and the available debt amounts may not sum to the total debt commitment amount.

  9. The ending net debt to equity leverage ratios excludes unfunded commitments.

Goldman Sachs BDC, Inc.

Consolidated Statements of Assets and Liabilities

(in thousands, except share and per share amounts)

 

 

 

June 30, 2020
(Unaudited)

 

 

December 31,
2019

 

Assets

 

 

 

 

 

 

 

 

Investments, at fair value

 

 

 

 

 

 

 

 

Non-controlled/non-affiliated investments (cost of $1,364,946 and $1,338,268)

 

$

1,283,565

 

 

$

1,298,133

 

Non-controlled affiliated investments (cost of $83,410 and $83,460)

 

 

94,492

 

 

 

82,580

 

Controlled affiliated investments (cost of $85,603 and $88,119)

 

 

46,410

 

 

 

73,539

 

Investments in affiliated money market fund (cost of $89,470 and $?)

 

 

89,470

 

 

 

?

 

Cash

 

 

16,318

 

 

 

9,409

 

Receivable for investments sold

 

 

153

 

 

 

93

 

Unrealized appreciation on foreign currency forward contracts

 

 

33

 

 

 

32

 

Interest and dividends receivable

 

 

8,406

 

 

 

5,702

 

Deferred financing costs

 

 

8,618

 

 

 

4,427

 

Deferred offering costs

 

 

?

 

 

 

276

 

Other assets

 

 

3,139

 

 

 

1,084

 

Total assets

 

$

1,550,604

 

 

$

1,475,275

 

Liabilities

 

 

 

 

 

 

 

 

Debt (net of debt issuance costs of $9,229 and $3,680)

 

$

909,263

 

 

$

769,727

 

Interest and other debt expenses payable

 

 

7,659

 

 

 

2,304

 

Management fees payable

 

 

1,467

 

 

 

3,653

 

Incentive fees payable

 

 

?

 

 

 

1,850

 

Distribution payable

 

 

18,181

 

 

 

18,165

 

Directors' fees payable

 

 

135

 

 

 

?

 

Accrued offering costs

 

 

?

 

 

 

28

 

Accrued expenses and other liabilities

 

 

2,403

 

 

 

3,423

 

Total liabilities

 

$

939,108

 

 

$

799,150

 

Commitments and Contingencies

 

 

 

 

 

 

 

 

Net Assets

 

 

 

 

 

 

 

 

Preferred stock, par value $0.001 per share (1,000,000 shares authorized, no shares issued and outstanding)

 

$

?

 

 

$

?

 

Common stock, par value $0.001 per share (200,000,000 shares authorized, 40,401,637 and 40,367,071 shares issued and outstanding as of June 30, 2020 and December 31, 2019)

 

 

40

 

 

 

40

 

Paid-in capital in excess of par

 

 

778,827

 

 

 

778,132

 

Distributable earnings

 

 

(165,950

)

 

 

(100,626

)

Allocated income tax expense

 

 

(1,421

)

 

 

(1,421

)

TOTAL NET ASSETS

 

$

611,496

 

 

$

676,125

 

TOTAL LIABILITIES AND NET ASSETS

 

$

1,550,604

 

 

$

1,475,275

 

Net asset value per share

 

$

15.14

 

 

$

16.75

 

Goldman Sachs BDC, Inc.

Consolidated Statements of Operations

(in thousands, except share and per share amounts)

(Unaudited)

 

 

 

For the Three Months Ended

 

 

For the Six Months Ended

 

 

 

June 30,
2020

 

 

June 30,
2019

 

 

June 30,
2020

 

 

June 30,
2019

 

Investment Income:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

From non-controlled/non-affiliated investments:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest income

 

$

28,509

 

 

$

34,713

 

 

$

58,024

 

 

$

66,282

 

Payment-in-kind

 

 

535

 

 

 

174

 

 

 

1,149

 

 

 

476

 

Other income

 

 

245

 

 

 

870

 

 

 

492

 

 

 

1,521

 

Total investment income from non-controlled/non-affiliated investments

 

 

29,289

 

 

 

35,757

 

 

 

59,665

 

 

 

68,279

 

From non-controlled affiliated investments:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest income

 

 

423

 

 

 

576

 

 

 

1,088

 

 

 

1,194

 

Payment-in-kind

 

 

385

 

 

 

376

 

 

 

575

 

 

 

745

 

Dividend income

 

 

38

 

 

 

53

 

 

 

43

 

 

 

85

 

Other income

 

 

41

 

 

 

11

 

 

 

46

 

 

 

22

 

Total investment income from non-controlled affiliated investments

 

 

887

 

 

 

1,016

 

 

 

1,752

 

 

 

2,046

 

From controlled affiliated investments:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Payment-in-kind

 

 

366

 

 

 

565

 

 

 

996

 

 

 

1,100

 

Interest income

 

 

60

 

 

 

63

 

 

 

161

 

 

 

63

 

Dividend income

 

 

?

 

 

 

1,000

 

 

 

?

 

 

 

3,450

 

Total investment income from controlled affiliated investments

 

 

426

 

 

 

1,628

 

 

 

1,157

 

 

 

4,613

 

Total investment income

 

$

30,602

 

 

$

38,401

 

 

$

62,574

 

 

$

74,938

 

Expenses:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest and other debt expenses

 

$

9,114

 

 

$

9,501

 

 

$

18,008

 

 

$

17,954

 

Management fees

 

 

3,617

 

 

 

3,742

 

 

 

7,283

 

 

 

7,278

 

Incentive fees

 

 

?

 

 

 

4,144

 

 

 

?

 

 

 

4,637

 

Professional fees

 

 

623

 

 

 

689

 

 

 

1,337

 

 

 

1,331

 

Administration, custodian and transfer agent fees

 

 

228

 

 

 

239

 

 

 

469

 

 

 

479

 

Directors' fees

 

 

139

 

 

 

114

 

 

 

278

 

 

 

227

 

Other expenses

 

 

462

 

 

 

433

 

 

 

834

 

 

 

769

 

Total expenses

 

$

14,183

 

 

$

18,862

 

 

$

28,209

 

 

$

32,675

 

Fee waiver

 

 

(2,150

)

 

 

?

 

 

 

(2,810

)

 

 

?

 

Net expenses

 

$

12,033

 

 

$

18,862

 

 

$

25,399

 

 

$

32,675

 

NET INVESTMENT INCOME BEFORE TAXES

 

$

18,569

 

 

$

19,539

 

 

$

37,175

 

 

$

42,263

 

Income tax expense, including excise tax

 

$

389

 

 

$

452

 

 

$

816

 

 

$

891

 

NET INVESTMENT INCOME AFTER TAXES

 

$

18,180

 

 

$

19,087

 

 

$

36,359

 

 

$

41,372

 

Net realized and unrealized gains (losses) on investment transactions:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net realized gain (loss) from:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Non-controlled/non-affiliated investments

 

$

(1,182

)

 

$

(8,570

)

 

$

(6,616

)

 

$

(33,292

)

Non-controlled affiliated investments

 

 

(211

)

 

 

?

 

 

 

(211

)

 

 

?

 

Controlled affiliated investments

 

 

?

 

 

 

(673

)

 

 

(4,704

)

 

 

(673

)

Foreign currency forward contracts

 

 

52

 

 

 

34

 

 

 

80

 

 

 

52

 

Foreign currency transactions

 

 

(23

)

 

 

(10

)

 

 

(18

)

 

 

(16

)

Net change in unrealized appreciation (depreciation) from:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Non controlled/non-affiliated investments

 

 

31,798

 

 

 

(1,435

)

 

 

(41,246

)

 

 

5,771

 

Non-controlled affiliated investments

 

 

8,169

 

 

 

5,840

 

 

 

11,962

 

 

 

3,084

 

Controlled affiliated investments

 

 

(21,214

)

 

 

2,440

 

 

 

(24,613

)

 

 

1,546

 

Foreign currency forward contracts

 

 

(81

)

 

 

(45

)

 

 

1

 

 

 

33

 

Foreign currency translations

 

 

(670

)

 

 

(507

)

 

 

(55

)

 

 

295

 

Net realized and unrealized gains (losses)

 

$

16,638

 

 

$

(2,926

)

 

$

(65,420

)

 

$

(23,200

)

(Provision) benefit for taxes on realized gain/loss on investments

 

 

?

 

 

 

121

 

 

 

?

 

 

 

121

 

(Provision) benefit for taxes on unrealized appreciation/depreciation on investments

 

 

?

 

 

 

(152

)

 

 

99

 

 

 

52

 

NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS

 

$

34,818

 

 

$

16,130

 

 

$

(28,962

)

 

$

18,345

 

Weighted average shares outstanding

 

 

40,401,637

 

 

 

40,297,090

 

 

 

40,398,978

 

 

 

40,279,173

 

Net investment income per share (basic and diluted)

 

$

0.45

 

 

$

0.47

 

 

$

0.90

 

 

$

1.03

 

Earnings (loss) per share (basic and diluted)

 

$

0.86

 

 

$

0.40

 

 

$

(0.72

)

 

$

0.46

 

ABOUT GOLDMAN SACHS BDC, INC.

Goldman Sachs BDC, Inc. is a specialty finance company that has elected to be regulated as a business development company under the Investment Company Act of 1940. GSBD was formed by The Goldman Sachs Group, Inc. ("Goldman Sachs") to invest primarily in middle-market companies in the United States, and is externally managed by Goldman Sachs Asset Management, L.P., an SEC-registered investment adviser and a wholly-owned subsidiary of Goldman Sachs. GSBD seeks to generate current income and, to a lesser extent, capital appreciation primarily through direct originations of secured debt, including first lien, first lien/last-out unitranche and second lien debt, and unsecured debt, including mezzanine debt, as well as through select equity investments. For more information, visit www.goldmansachsbdc.com. Information on the website is not incorporated by reference into this press release and is provided merely for convenience.

FORWARD-LOOKING STATEMENTS

This press release may contain forward-looking statements that involve substantial risks and uncertainties, including the impact of COVID-19 on the business, future operating results, access to capital and liquidity of the Company and its portfolio companies. You can identify these statements by the use of forward-looking terminology such as "may," "will," "should," "expect," "anticipate," "project," "target," "estimate," "intend," "continue," or "believe" or the negatives thereof or other variations thereon or comparable terminology. You should read statements that contain these words carefully because they discuss our plans, strategies, prospects and expectations concerning our business, operating results, financial condition and other similar matters. These statements represent the Company's belief regarding future events that, by their nature, are uncertain and outside of the Company's control. Any forward-looking statement made by us in this press release speaks only as of the date on which we make it. Factors or events that could cause our actual results to differ, possibly materially from our expectations, include, but are not limited to, the risks, uncertainties and other factors we identify in the sections entitled "Risk Factors" and "Cautionary Statement Regarding Forward-Looking Statements" in filings we make with the Securities and Exchange Commission, and it is not possible for us to predict or identify all of them. We undertake no obligation to update or revise publicly any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law.


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With the goal of delivering solutions to safeguard communities against COVID-19, Black & Veatch's IgniteX COVID-19 Response Accelerator has launched five projects of new-to-market technologies at commercial sites in the United States. Based on these...

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Technavio has been monitoring the commercial aircraft seating market and it is poised to grow by $ 4.67 bn during 2020-2024, progressing at a CAGR of almost 9% during the forecast period. The report offers an up-to-date analysis regarding the current...



News published on 10 august 2020 at 17:20 and distributed by: