• TCG BDC, Inc. Announces Third Quarter 2021 Financial Results and Declares Fourth Quarter 2021 Base Dividend of $0.32 Per Common Share and Supplemental Dividend of $0.07 per Common Share

    来源: Nasdaq GlobeNewswire / 02 11月 2021 16:38:18   America/New_York

    NEW YORK, Nov. 02, 2021 (GLOBE NEWSWIRE) -- TCG BDC, Inc. (together with its consolidated subsidiaries, “we,” “us,” “our,” “TCG BDC” or the “Company”) (NASDAQ: CGBD) today announced its financial results for its third quarter ended September 30, 2021.

    Linda Pace, TCG BDC’s Chief Executive Officer said, "Our third quarter results reflect both the active deal environment and the continued strength in the portfolio. Our credit fundamentals are solid, and this quarter's net asset value is now above pre-pandemic levels, demonstrating strong investment performance through a volatile and challenging credit cycle. We continue to be well positioned to deliver attractive, sustainable income generation and NAV stability for our shareholders.”

    Selected Financial Highlights

    (dollar amounts in thousands, except per share data)September 30, 2021 June 30, 2021
    Total investments, at fair value$1,948,206  $1,872,311 
    Total assets2,044,170  1,962,166 
    Total debt1,061,815  1,001,234 
    Total net assets$944,394  $924,831 
    Net assets per common share$16.65  $16.14 
            


      For the three month periods ended
      September 30, 2021 June 30, 2021
    Total investment income $43,762  $42,656 
    Net investment income (loss) 22,086  21,637 
    Net realized gain (loss) and net change in unrealized appreciation (depreciation) on investments and non-investment assets and liabilities 25,534  21,231 
    Net increase (decrease) in net assets resulting from operations $47,620  $42,868 
         
    Per weighted-average common share—Basic:    
    Net investment income (loss), net of preferred dividend $0.39  $0.38 
    Net realized gain (loss) and net change in unrealized appreciation (depreciation) on investments and non-investment assets and liabilities 0.48  0.39 
    Net increase (decrease) in net assets resulting from operations attributable to common stockholders $0.87  $0.77 
    Weighted-average shares of common stock outstanding—Basic 53,955,338  54,537,840 
    Base dividends declared per common share $0.32  $0.32 
    Supplemental dividends declared per common share $0.06  $0.04 
             

    Third Quarter 2021 Highlights
    (dollar amounts in thousands, except per share data)

    • Net investment income, net of the preferred dividend, for the three month period ended September 30, 2021 was $21,211, or $0.39 per common share, as compared to $20,762, or $0.38 per common share, for the three month period ended June 30, 2021.
    • Net realized gain (loss) and net change in unrealized appreciation (depreciation) on investments and non-investment assets and liabilities for the three month period ended September 30, 2021 was $25,534, or $0.48 per share, as compared to $21,231, or $0.39 per share, for the three month period ended June 30, 2021.
    • Net increase (decrease) in net assets resulting from operations attributable to common stockholders for the three month period ended September 30, 2021 was $46,745, or $0.87 per common share, as compared to $41,993, or $0.77 per share, for the three month period ended June 30, 2021.
    • Net asset value per common share for the quarter ended September 30, 2021 increased 3.2% to $16.65 from $16.14 as of June 30, 2021, and is 0.5% higher than the $16.56 reported as of December 31, 2019, prior to the onset of the global pandemic.
    • During the three month period ended September 30, 2021, the Company repurchased and extinguished 0.5 million shares of the Company's common stock pursuant to the Company’s previously announced $150 million stock repurchase program at an average cost of $13.65 per share, or $6.8 million in the aggregate, resulting in accretion to net assets per share of $0.02. As of September 30, 2021, there was $32.7 million remaining under the stock repurchase program.
    • On November 1, 2021, the Board of Directors declared a base quarterly common dividend of $0.32 plus a supplemental common dividend of $0.07, which are payable on January 14, 2022 to common stockholders of record on December 31, 2021.

    Portfolio and Investment Activity
    (dollar amounts in thousands, except per share data, unless otherwise noted)

    As of September 30, 2021, the fair value of our investments was approximately $1,948,206, comprised of 163 investments in 123 portfolio companies/investment fund across 28 industries. This compares to the Company’s portfolio as of June 30, 2021, as of which date the fair value of our investments was approximately $1,872,311, comprised of 161 investments in 118 portfolio companies/investment fund across 27 industries.

    As of September 30, 2021 and June 30, 2021, investments consisted of the following:

     September 30, 2021 June 30, 2021
    Type—% of Fair ValueFair Value % of Fair Value Fair Value % of Fair Value
    First Lien Debt$1,275,553  65.5% $1,246,018  66.5%
    Second Lien Debt352,570  18.1  313,130  16.7 
    Equity Investments52,665  2.7  53,379  2.9 
    Investment Funds267,418  13.7  259,784  13.9 
    Total$1,948,206  100.0% $1,872,311  100.0%
                  

    The following table shows our investment activity for the three month period ended September 30, 2021:

     Funded Sold/Repaid
    Principal amount of investments:Amount % of Total Amount % of Total
    First Lien Debt$217,652  78.6% $(195,020) 90.6%
    Second Lien Debt58,857  21.2% (18,230) 8.5 
    Equity Investments446  0.2  (1,870) 0.9 
    Investment Funds—  —  —  — 
    Total$276,955  100.0% $(215,120) 100.0%
                  

    Overall, total investments at fair value increased by 4.1%, or $75,895, during the three month period ended September 30, 2021 after factoring in repayments, sales, net fundings on revolvers and delayed draws and net change in unrealized appreciation (depreciation).

    As of September 30, 2021, the total weighted average yield for our first and second lien debt investments on an amortized cost basis was 7.69%, which includes the effect of accretion of discounts and amortization of premiums and are based on interest rates as of September 30, 2021. As of September 30, 2021, on a fair value basis, approximately 1.5% of our debt investments bear interest at a fixed rate and approximately 98.5% of our debt investments bear interest at a floating rate, which primarily are subject to interest rate floors.

    The Company has investments in two credit funds, Middle Market Credit Fund, LLC (“Credit Fund”) and Middle Market Credit Fund II, LLC (“Credit Fund II”), which represented 13.7% of the Company's total investments at fair value.

    Total investments at fair value held by Credit Fund, which is not consolidated with the Company, decreased by 1.7%, or $18,993, during the three month period ended September 30, 2021 after factoring in repayments, sales, net fundings on revolvers and delayed draws and net change in unrealized appreciation (depreciation). As of September 30, 2021, Credit Fund had total investments at fair value of $1,078,265, which were comprised 100.0% of first lien senior secured loans at fair value. As of September 30, 2021, on a fair value basis, 100.0% of Credit Fund’s debt investments bear interest at a floating rate, which primarily are subject to interest rate floors.

    As of September 30, 2021, total investments at fair value held by Credit Fund II, which is not consolidated with the Company, decreased by $166 during the three month period ended September 30, 2021 after factoring in repayments, sales, and net change in unrealized appreciation (depreciation). As of September 30, 2021, Credit Fund II had total investments at fair value of $244,388, which comprised 89.2% of first lien senior secured loans and 10.8% of second lien senior secured loans at fair value. As of September 30, 2021, on a fair value basis, approximately 2.2% of Credit Fund II’s debt investments bear interest at a fixed rate and approximately 97.8% of Credit Fund II’s debt investments bear interest at a floating rate, which primarily are subject to interest rate floors.

    As part of the monitoring process, our Investment Adviser has developed risk policies pursuant to which it regularly assesses the risk profile of each of our debt investments and rates each of them based on the following categories, which we refer to as “Internal Risk Ratings”. Key drivers of internal risk ratings include financial metrics, financial covenants, liquidity and enterprise value coverage.

    Internal Risk Ratings Definitions

    Rating  Definition
    1  Borrower is operating above expectations, and the trends and risk factors are generally favorable.
      
    2  Borrower is operating generally as expected or at an acceptable level of performance. The level of risk to our initial cost bases is similar to the risk to our initial cost basis at the time of origination. This is the initial risk rating assigned to all new borrowers.
      
    3  Borrower is operating below expectations and level of risk to our cost basis has increased since the time of origination. The borrower may be out of compliance with debt covenants. Payments are generally current although there may be higher risk of payment default.
      
    4  Borrower is operating materially below expectations and the loan’s risk has increased materially since origination. In addition to the borrower being generally out of compliance with debt covenants, loan payments may be past due, but generally not by more than 120 days. It is anticipated that we may not recoup our initial cost basis and may realize a loss of our initial cost basis upon exit.
      
    5  Borrower is operating substantially below expectations and the loan’s risk has increased substantially since origination. Most or all of the debt covenants are out of compliance and payments are substantially delinquent. It is anticipated that we will not recoup our initial cost basis and may realize a substantial loss of our initial cost basis upon exit.

    Our Investment Adviser monitors and, when appropriate, changes the investment ratings assigned to each debt investment in our portfolio. Our Investment Adviser reviews our investment ratings in connection with our quarterly valuation process. The following table summarizes the Internal Risk Ratings of our debt portfolio as of September 30, 2021 and June 30, 2021:

     September 30, 2021 June 30, 2021
     Fair Value % of Fair Value Fair Value % of Fair Value
    (dollar amounts in millions)       
    Internal Risk Rating 1$3.8  0.2% $6.0  0.4%
    Internal Risk Rating 21,245.1  76.5  1,157.7  74.3 
    Internal Risk Rating 3311.8  19.2  333.7  21.4 
    Internal Risk Rating 428.1  1.7  26.5  1.7 
    Internal Risk Rating 539.4  2.4  35.2  2.3 
    Total$1,628.1  100.0% $1,559.1  100.0%
                  

    As of September 30, 2021 and June 30, 2021, the weighted average Internal Risk Rating of our debt investment portfolio was 2.3 and 2.3, respectively.

    Consolidated Results of Operations
    (dollar amounts in thousands, except per share data)

    Total investment income for the three month periods ended September 30, 2021 and June 30, 2021 was $43,762 and $42,656, respectively. This $1,106 net increase was primarily due to higher core interest income from a higher average investment balance.

    Total expenses for the three month periods ended September 30, 2021 and June 30, 2021 were $21,676 and $21,019, respectively. This $657 net increase during the three month period ended September 30, 2021 was mainly due to an increase in interest expense in the three month period ended September 30, 2021.

    During the three month period ended September 30, 2021, the Company recorded a net realized and unrealized gain of $25,534. This was driven by improving credit fundamentals, realized gains on equity co-investments, and an increase in value of the Company's investment in Credit Fund.

    Liquidity and Capital Resources
    (dollar amounts in thousands, except per share data)

    As of September 30, 2021, the Company had cash, cash equivalents and restricted cash of $46,164, notes payable and senior unsecured notes (before debt issuance costs) of $449,200 and $190,000, respectively, and secured borrowings outstanding of $425,545. As of September 30, 2021, the Company had $262,455 of remaining unfunded commitments and $261,252 available for additional borrowings under its revolving credit facilities, subject to leverage and borrowing base restrictions.

    Dividends

    On November 1, 2021, the Board of Directors declared a base quarterly common dividend of $0.32 plus a supplemental common dividend of $0.07, which are payable on January 14, 2022 to common stockholders of record on December 31, 2021.

    On September 30, 2021, the Company declared and paid a cash dividend on the Preferred Stock for the period from July 1, 2021 to September 30, 2021 in the amount of $0.438 per Preferred Share to the holder of record on September 30, 2021.

    Conference Call

    The Company will host a conference call at 11:00 a.m. EDT on Wednesday, November 3, 2021 to discuss these quarterly financial results. The call and webcast will be available on the TCG BDC website at tcgbdc.com. The call may be accessed by dialing +1 (866) 394-4623 (U.S.) or +1 (409) 350-3158 (international) and referencing “TCG BDC Financial Results Call.” The conference call will be webcast simultaneously via a link on TCG BDC’s website and an archived replay of the webcast also will be available on the website soon after the live call for 21 days.

    TCG BDC, INC.
    CONSOLIDATED STATEMENTS OF ASSETS AND LIABILITIES
    (dollar amounts in thousands, except per share data)

     September 30, 2021 June 30, 2021
     (unaudited)  
    ASSETS   
    Investments, at fair value   
    Investments—non-controlled/non-affiliated, at fair value (amortized cost of $1,669,617 and $1,609,860, respectively)$1,643,584  $1,579,256 
    Investments—non-controlled/affiliated, at fair value (amortized cost of $38,582 and $38,417, respectively)30,410  28,562 
    Investments—controlled/affiliated, at fair value (amortized cost of $288,056 and $288,051, respectively)274,212  264,493 
    Total investments, at fair value (amortized cost of $1,996,255 and $1,936,328, respectively)1,948,206  1,872,311 
    Cash, cash equivalents and restricted cash46,164  59,404 
    Receivable for investment sold/repaid23,235  5,769 
    Deferred financing costs3,256  3,386 
    Interest receivable from non-controlled/non-affiliated investments13,486  11,388 
    Interest receivable from non-controlled/affiliated investments581  578 
    Interest and dividend receivable from controlled/affiliated investments7,866  7,961 
    Prepaid expenses and other assets1,376  1,369 
    Total assets$2,044,170  $1,962,166 
    LIABILITIES   
    Secured borrowings$425,545  $365,060 
    2015-1R Notes payable, net of unamortized debt issuance costs of $2,479 and $2,541, respectively446,721  446,659 
    Senior Notes, net of unamortized debt issuance costs of $451 and $485, respectively)189,549  189,515 
    Payable for investments purchased68  875 
    Interest and credit facility fees payable3,045  2,463 
    Dividend payable20,388  19,502 
    Base management and incentive fees payable11,752  11,391 
    Administrative service fees payable661  373 
    Other accrued expenses and liabilities2,047  1,497 
    Total liabilities1,099,776  1,037,335 
        
    NET ASSETS   
    Cumulative convertible preferred stock, $0.01 par value; 2,000,0000 shares authorized; 2,000,000 shares issued and outstanding as of September 30, 2021 and June 30, 202150,000  50,000 
    Common stock, $0.01 par value; 198,000,000 shares authorized; 53,714,444 and 54,210,315 shares issued and outstanding at September 30, 2021 and June 30, 2021, respectively537  542 
    Paid-in capital in excess of par value1,060,955  1,067,720 
    Offering costs(1,633) (1,633)
    Total distributable earnings (loss)(165,465) (191,798)
    Total net assets$944,394  $924,831 
    NET ASSETS PER COMMON SHARE$16.65  $16.14 
            

    TCG BDC, INC.
    CONSOLIDATED STATEMENTS OF OPERATIONS
    (dollar amounts in thousands, except per share data)
    (unaudited)

      For the three month periods ended
      September 30, 2021 June 30, 2021
    Investment income:    
    From non-controlled/non-affiliated investments:    
    Interest income $35,387  $32,661 
    Other income 750  2,401 
    Total investment income from non-controlled/non-affiliated investments 36,137  35,062 
    From non-controlled/affiliated investments:    
    Interest income 47  45 
    Other income 2  3 
    Total investment income from non-controlled/affiliated investments 49  48 
    From controlled/affiliated investments:    
    Interest income 46  55 
    Dividend income 7,523  7,488 
    Other income 7  3 
    Total investment income from controlled/affiliated investments 7,576  7,546 
    Total investment income 43,762  42,656 
    Expenses:    
    Base management fees 7,233  6,991 
    Incentive fees 4,516  4,420 
    Professional fees 836  917 
    Administrative service fees 400  375 
    Interest expense 7,519  7,055 
    Credit facility fees 435  505 
    Directors’ fees and expenses 154  150 
    Other general and administrative 420  467 
    Total expenses 21,513  20,880 
    Net investment income (loss) before taxes 22,249  21,776 
    Excise tax expense 163  139 
    Net investment income (loss) 22,086  21,637 
    Net realized gain (loss) and net change in unrealized appreciation (depreciation) on investments and non-investment assets and liabilities:    
    Net realized gain (loss) from:    
    Non-controlled/non-affiliated investments 7,565  1,944 
    Controlled/affiliated investments —  1 
    Currency gains (losses) on non-investment assets and liabilities (9) (56)
    Net change in unrealized appreciation (depreciation) on investments:    
    Non-controlled/non-affiliated 4,574  16,338 
    Non-controlled/affiliated 1,683  890 
    Controlled/affiliated 9,730  2,060 
    Net change in unrealized currency gains (losses) on non-investment assets and liabilities 1,991  54 
    Net realized and unrealized gain (loss) on investments and non-investment assets and liabilities 25,534  21,231 
    Net increase (decrease) in net assets resulting from operations 47,620  42,868 
    Preferred stock dividend 875  875 
    Net increase (decrease) in net assets resulting from operations attributable to Common Stockholders $46,745  $41,993 
    Basic and diluted earnings per common share:    
    Basic $0.87  $0.77 
    Diluted $0.80  $0.72 
    Weighted-average shares of common stock outstanding:    
    Basic 53,955,338  54,537,840 
    Diluted 59,230,725  59,805,142 
           

    About TCG BDC, Inc.

    TCG BDC is an externally managed specialty finance company focused on lending to middle-market companies. TCG BDC is managed by Carlyle Global Credit Investment Management L.L.C., an SEC-registered investment adviser and a wholly owned subsidiary of The Carlyle Group Inc. Since it commenced investment operations in May 2013 through September 30, 2021, TCG BDC has invested approximately $6.9 billion in aggregate principal amount of debt and equity investments prior to any subsequent exits or repayments. TCG BDC’s investment objective is to generate current income and capital appreciation primarily through debt investments in U.S. middle market companies. TCG BDC has elected to be regulated as a business development company under the Investment Company Act of 1940, as amended.

    Web: tcgbdc.com

    CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS

    This press release may contain forward-looking statements that involve substantial risks and uncertainties. You can identify these statements by the use of forward-looking terminology such as “anticipates,” “believes,” “expects,” “intends,” “will,” “should,” “may,” “plans,” “continue,” “believes,” “seeks,” “estimates,” “would,” “could,” “targets,” “projects,” “outlook,” “potential,” “predicts” and variations of these words and similar expressions to identify forward-looking statements, although not all forward-looking statements include these words. 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. We believe that it is important to communicate our future expectations to our investors. There may be events in the future, however, that we are not able to predict accurately or control. You should not place undue reliance on these forward-looking statements, which speak 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.

    Contacts:

    Investors:Media:
    L. Allison RudaryBrittany Berliner
    +1-212-813-4756
    allison.rudary@carlyle.com    		+1-212-813-4839
    brittany.berliner@carlyle.com
      

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