EX-99.1 2 d209352dex991.htm PRESS RELEASE OF GOLDMAN SACHS BDC, INC., DATED AUGUST 5, 2021. Press Release of Goldman Sachs BDC, Inc., dated August 5, 2021.

Exhibit 99.1

 

LOGO

Goldman Sachs BDC, Inc. Reports June 30, 2021 Financial Results and Announces Quarterly Dividend of $0.45 Per Share

Company Release – August 5, 2021

NEW YORK — (BUSINESS WIRE) — Goldman Sachs BDC, Inc. (“GSBD” or the “Company”) (NYSE: GSBD) today reported financial results for the second quarter ended June 30, 2021 and filed its Form 10-Q with the U.S. Securities and Exchange Commission.

QUARTERLY HIGHLIGHTS

 

  •  

Net investment income per share for the quarter ended June 30, 2021 was $0.57. Excluding purchase discount amortization per share of $0.09 from the Merger (as defined below), adjusted net investment income per share was $0.48, equating to an annualized net investment income yield on book value of 12.0%.1 Earnings per share for the quarter ended June 30, 2021 was $0.54;

 

  •  

The Board declared a regular third quarter dividend of $0.45 per share payable to shareholders of record as of September 30, 2021;2 In addition, the Company paid a special dividend of $0.05 per share on June 15, 2021, and will pay an additional $0.05 special dividend on September 15, 2021 to shareholders of record as of August 16, 2021;

 

  •  

Net asset value per share for the quarter ended June 30, 2021 increased 0.3% to $16.05 from $16.00 as of March 31, 2021;

 

  •  

During the quarter, the Company made new investment commitments of $368.8 million, funded new investment commitments of $174.8 million, had net fundings of previously unfunded commitments of $35.2 million, and had sales and repayments activity totaling $277.4 million, resulting in a net funded portfolio change of $(67.4) million;

 

  •  

The Company’s net debt to equity ratio was 0.91x as of June 30, 2021 versus 0.96x as of March 31, 2021;

 

  •  

As of June 30, 2021, the Company’s total investments at fair value and commitments were $3,533.6 million, comprised of investments in 114 portfolio companies across 37 industries. The investment portfolio was comprised of 96.8% senior secured debt, including 84.5% in first lien investments;3

 

  •  

No new investments were placed on non-accrual during the quarter, and as of June 30, 2021, investments on non-accrual status amounted to 0.0% and 0.3% of the total investment portfolio at fair value and amortized cost, respectively;

 

  •  

As of June 30, 2021, 63% of the Company’s approximately $1,598.6 million of total principal amount of debt outstanding was comprised of unsecured debt and 37% was comprised of secured debt.

SELECTED FINANCIAL HIGHLIGHTS

 

(in $ millions, except per share data)   

As of

June 30, 2021

     

As of

March 31, 2021

  

Investment portfolio, at fair value3

    $ 3,156.5      $ 3,202.6  

Total debt outstanding4

    $ 1,598.6      $ 1,608.0  

Net assets

    $ 1,631.5      $ 1,625.9  

Net asset value per share

    $ 16.05      $ 16.00  

Net debt to equity

      0.91x        0.96x  

(in $ millions, except per share data)   

Three Months Ended

June 30, 2021

     

Three Months Ended

March 31, 2021

  

Total investment income

    $ 83.9      $ 82.6  

Net investment income after taxes

    $ 58.2      $ 57.6  

Less: Purchase discount amortization

      9.4        9.1  

Adjusted net investment income after taxes1

    $ 48.8      $ 48.5  

Net realized and unrealized gains (losses)

    $ (3.1 )     $ 3.0  

Add: Realized/Unrealized gains from the purchase discount

      9.4        9.1  

Adjusted net realized and unrealized gains (losses)1

    $ 6.3      $ 12.1  

Net investment income per share (basic and diluted)

    $ 0.57      $ 0.57  

Less: Purchase discount amortization per share

      0.09        0.09  

Adjusted net investment income per share1

    $ 0.48      $ 0.48  

Weighted average shares outstanding

      101.6        101.6  

Distributions declared per share

    $ 0.50      $ 0.50  

Total investment income for the three months ended June 30, 2021 and March 31, 2021 was $83.9 million and $82.6 million, respectively. The increase in investment income was primarily driven by an increase in accelerated accretion related to repayments, partially offset by a decrease in dividend and other income.

Net expenses before taxes for the three months ended June 30, 2021 and March 31, 2021 were $25.4 million and $24.7 million, respectively. Net expenses increased by $0.7 million primarily as a result of an increase in net incentive fees and an increase in management fees, partially offset by a decrease in interest and other debt expenses.

INVESTMENT ACTIVITY3

Summary of Investment Activity for the three months ended June 30, 2021 was as follows:

 

     New Investment
Commitments		     Sales and Repayments  

Investment Type

    $ Millions      % of
Total		     $ Millions      % of
Total		  

1st Lien/Senior Secured Debt

    $ 363.6        98.6 %    $ 194.0        69.9 % 

1st Lien/Last-Out Unitranche

      —          —         0.5        0.2  

2nd Lien/Senior Secured Debt

      5.2        1.4       82.9        29.9  
  

 

 

     

 

 

    

 

 

     

 

 

  

Total

    $ 368.8        100.0 %    $ 277.4        100.0 % 
  

 

 

     

 

 

    

 

 

     

 

 

  

During the three months ended June 30, 2021, new investment commitments and fundings were across six new portfolio companies and ten existing portfolio companies. Sales and repayments were primarily driven by the full repayment of investments in twelve portfolio companies.3

PORTFOLIO SUMMARY3

As of June 30, 2021, the Company’s investments consisted of the following:

 

                                                   
     Investments at Fair Value  

Investment Type

    $ Millions      % of Total  

1st Lien/Senior Secured Debt

    $ 2,528.6        80.1 % 

1st Lien/Last-Out Unitranche

      137.0        4.4  

2nd Lien/Senior Secured Debt

      391.2        12.4  

Unsecured Debt

      0.5        0.0  

Preferred Stock

      54.6        1.7  

Common Stock

      44.2        1.4  

Warrants

      0.4        0.0  
  

 

 

     

 

 

  

Total

    $ 3,156.5        100.0 % 
  

 

 

     

 

 

  

The following table presents certain selected information regarding the Company’s investments:

 

                                             
     As of  
     June 30, 2021     March 31, 2021  

Number of portfolio companies

      114       118  

Percentage of performing debt bearing a floating rate5

      99.1 %      99.0 % 

Percentage of performing debt bearing a fixed rate5

      0.9 %      1.0 % 

Weighted average yield on debt and income producing investments, at amortized cost6

      8.7 %      8.8 % 

Weighted average yield on debt and income producing investments, at fair value6

      8.7 %      8.8 % 

Weighted average leverage (net debt/EBITDA)7

      5.9x       6.0x  

Weighted average interest coverage7

      2.6x       2.5x  

Median EBITDA7

    $ 37.6 million     $ 32.4 million  

As of June 30, 2021, investments on non-accrual status represented 0.0% and 0.3% of the total investment portfolio at fair value and amortized cost, respectively.

LIQUIDITY AND CAPITAL RESOURCES

As of June 30, 2021, the Company had $1,598.6 million of total principal amount of debt outstanding, comprised of $583.6 million of outstanding borrowings under its senior secured revolving credit facility (“Secured Revolving Credit Facility”), $155.0 million of convertible notes, $360.0 million of unsecured notes due 2025, and $500.0 million of unsecured notes due 2026. The combined weighted average interest rate on debt outstanding was 2.91% for the quarter ended June 30, 2021. As of June 30, 2021, the Company had $1,110.7 million of availability under its Senior Revolving Credit Facility and $119.9 million in cash and cash equivalents.4,8

The Company’s average and ending net debt to equity leverage ratio was 0.95x and 0.91x, respectively, for the three months ended June 30, 2021, as compared with 1.02x and 0.96x, respectively, for the three months ended March 31, 2021.9

CONFERENCE CALL

The Company will host an earnings conference call on Friday, August 6, 2021 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 8279752. 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 6, 2021 through September 6, 2021. To hear the replay, participants should dial (855) 859-2056; international callers should dial +1 (404) 537-3406; conference ID 8279752. 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)

On October 12, 2020, we completed our merger (the “Merger”) with Goldman Sachs Middle Market Lending Corp. (“MMLC”). The Merger was accounted for as an asset acquisition in accordance with ASC 805-50, Business Combinations — Related Issues. The consideration paid to MMLC’s stockholders was less than the aggregate fair values of the assets acquired and liabilities assumed, which resulted in a purchase discount (the “purchase discount”). The purchase discount was allocated to the cost of MMLC investments acquired by us on a pro-rata basis based on their relative fair values as of the closing date. Immediately following the Merger with MMLC, we marked the investments to their respective fair values and, as a result, the purchase discount allocated to the cost basis of the investments acquired was immediately recognized as unrealized appreciation on our Consolidated Statement of Operations. The purchase discount allocated to the loan investments acquired will amortize over the life of each respective loan through interest income, with a corresponding adjustment recorded as unrealized appreciation on such loan acquired through its ultimate disposition. The purchase discount allocated to equity investments acquired will not amortize over the life of such investments through interest income and, assuming no subsequent change to the fair value of the equity investments acquired and disposition of such equity investments at fair value, we will recognize a realized gain with a corresponding reversal of the unrealized appreciation on disposition of such equity investments acquired.

As a supplement to our financial results reported in accordance with GAAP, we have provided, as detailed below, certain non-GAAP financial measures to our operating results that exclude the aforementioned purchase discount and the ongoing amortization thereof, as determined in accordance with GAAP. The non-GAAP financial measures include i) Adjusted net investment income per share; ii) Adjusted net investment income after taxes; and iii) Adjusted net realized and unrealized gains (losses). We believe that the adjustment to exclude the full effect of the purchase discount is meaningful because it is a measure that we and investors use to assess our financial condition and results of operations. Although these non-GAAP financial measures are intended to enhance investors’ understanding of our business and performance, these non-GAAP financial measures should not be considered an alternative to GAAP. The aforementioned non-GAAP financial measures may not be comparable to similar non-GAAP financial measures used by other companies.

2)

The $0.45 per share dividend is payable on October 27, 2021 to stockholders of record as of September 30, 2021.

3)

The discussion of the investment portfolio excludes the investment in a money market fund managed by an affiliate of The Goldman Sachs Group, Inc. As of June 30, 2021, the Company did not have an investment in the money market fund.

4)

Total debt outstanding excludes netting of debt issuance costs of $14.8 million and $16.1 million, respectively, as of June 30, 2021 and March 31, 2021.

5)

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

6)

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 investment. Excludes the purchase discount and amortization related to the Merger.

7)

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 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 excluding 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, 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, excluding 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, 2021 and March 31, 2021, investments where net debt to EBITDA may not be the appropriate measure of credit risk represented 33.7% and 32.9%, respectively, of total debt investments at fair value.

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, 2021. 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 exclude unfunded commitments.

Goldman Sachs BDC, Inc.

Consolidated Statements of Assets and Liabilities

(in thousands, except share and per share amounts)

 

     June 30, 2021
(Unaudited)		     December 31,
2020		  

Assets

     

Investments, at fair value

     

Non-controlled/non-affiliated investments (cost of $3,009,297 and $3,089,481)

    $ 3,056,439     $ 3,135,745  

Non-controlled affiliated investments (cost of $65,052 and $64,699)

      79,542       87,211  

Controlled affiliated investments (cost of $31,248 and $28,400)

      20,483       19,810  
  

 

 

    

 

 

  

Total investments, at fair value (cost of $3,105,597 and $3,182,580)

    $ 3,156,464     $ 3,242,766  

Cash

      119,923       32,137  

Receivable for investments sold

      39       2,600  

Interest and dividends receivable

      21,635       21,593  

Deferred financing costs

      9,971       11,350  

Other assets

      1,975       1,916  
  

 

 

    

 

 

  

Total assets

    $ 3,310,007     $ 3,312,362  
  

 

 

    

 

 

  

Liabilities

     

Debt (net of debt issuance costs of $14,831 and $17,323)

    $ 1,583,740     $ 1,627,060  

Interest and other debt expenses payable

      15,980       10,163  

Management fees payable

      8,079       5,945  

Incentive fees payable

      974       2,665  

Distribution payable

      45,754       45,690  

Payable for investments purchased

      19,115       —    

Unrealized depreciation on foreign currency forward contracts

      81       355  

Directors’ fees payable

      231       —    

Accrued expenses and other liabilities

      4,528       5,343  
  

 

 

    

 

 

  

Total liabilities

    $ 1,678,482     $ 1,697,221  
  

 

 

    

 

 

  

Commitments and contingencies (Note 8)

     

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, 101,675,964 and 101,534,370 shares issued and outstanding as of June 30, 2021 and December 31, 2020)

      102       102  

Paid-in capital in excess of par

      1,624,394       1,621,813  

Distributable earnings

      8,450       (5,353 ) 

Allocated income tax expense

      (1,421 )      (1,421 ) 
  

 

 

    

 

 

  

Total net assets

    $ 1,631,525     $ 1,615,141  
  

 

 

    

 

 

  

Total liabilities and net assets

    $ 3,310,007     $ 3,312,362  
  

 

 

    

 

 

  

Net asset value per share

    $ 16.05     $ 15.91  

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,
2021		     June 30,
2020		     June 30,
2021		     June 30,
2020		  

Investment income:

         

From non-controlled/non-affiliated investments:

         

Interest income

    $ 78,362     $ 28,509     $ 156,527     $ 58,024  

Payment-in-kind

      4,275       535       6,411       1,149  

Other income

      621       245       1,616       492  

From non-controlled affiliated investments:

         

Dividend income

      61       38       826       43  

Interest income

      87       423       163       1,088  

Payment-in-kind

      154       385       303       575  

Other income

      —         41       —         46  

From controlled affiliated investments:

         

Interest income

      23       60       46       161  

Payment-in-kind

      334       366       643       996  
  

 

 

    

 

 

    

 

 

    

 

 

  

Total investment income

    $ 83,917     $ 30,602     $ 166,535     $ 62,574  
  

 

 

    

 

 

    

 

 

    

 

 

  

Expenses:

         

Interest and other debt expenses

    $ 14,538     $ 9,114     $ 29,504     $ 18,008  

Incentive fees

      11,170       —         23,225       —    

Management fees

      8,079       3,617       16,279       7,283  

Professional fees

      808       623       1,533       1,337  

Directors’ fees

      232       139       464       278  

Other general and administrative expenses

      800       690       1,898       1,303  
  

 

 

    

 

 

    

 

 

    

 

 

  

Total expenses

    $ 35,627     $ 14,183     $ 72,903     $ 28,209  
  

 

 

    

 

 

    

 

 

    

 

 

  

Fee waivers

      (10,196 )      (2,150 )      (22,751 )      (2,810 ) 
  

 

 

    

 

 

    

 

 

    

 

 

  

Net expenses

    $ 25,431     $ 12,033     $ 50,152     $ 25,399  
  

 

 

    

 

 

    

 

 

    

 

 

  

Net investment income before taxes

    $ 58,486     $ 18,569     $ 116,383     $ 37,175  
  

 

 

    

 

 

    

 

 

    

 

 

  

Income tax expense, including excise tax

    $ 310     $ 389     $ 624     $ 816  
  

 

 

    

 

 

    

 

 

    

 

 

  

Net investment income after taxes

    $ 58,176     $ 18,180     $ 115,759     $ 36,359  
  

 

 

    

 

 

    

 

 

    

 

 

  

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

         

Net realized gain (loss) from:

         

Non-controlled/non-affiliated investments

    $ (1,274 )    $ (1,182 )    $ 6,234     $ (6,616 ) 

Non-controlled affiliated investments

      —         (211 )      —         (211 ) 

Controlled affiliated investments

      —         —         —         (4,704 ) 

Foreign currency forward contracts

      (57 )      52       (171 )      80  

Foreign currency transactions

      (24 )      (23 )      44       (18 ) 

Net change in unrealized appreciation (depreciation) from:

         

Non-controlled/non-affiliated investments

      4,844       31,798       878       (41,246 ) 

Non-controlled affiliated investments

      (4,783 )      8,169       (8,022 )      11,962  

Controlled affiliated investments

      (798 )      (21,214 )      (2,175 )      (24,613 ) 

Foreign currency forward contracts

      27       (81 )      274       1  

Foreign currency translations

      (1,030 )      (670 )      2,842       (55 ) 
  

 

 

    

 

 

    

 

 

    

 

 

  

Net realized and unrealized gains (losses)

    $ (3,095 )    $ 16,638     $ (96 )    $ (65,420 ) 
  

 

 

    

 

 

    

 

 

    

 

 

  

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

      (53 )      —         (53 )      —    

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

      (56 )      —         (170 )      99  
  

 

 

    

 

 

    

 

 

    

 

 

  

Net increase (decrease) in net assets from operations

    $ 54,972     $ 34,818     $ 115,440     $ (28,962 ) 
  

 

 

    

 

 

    

 

 

    

 

 

  

Weighted average shares outstanding

      101,649,214       40,401,637       101,617,022       40,398,978  

Net investment income per share (basic and diluted)

    $ 0.57     $ 0.45     $ 1.14     $ 0.90  

Earnings (loss) per share (basic and diluted)

    $ 0.54     $ 0.86     $ 1.14     $ (0.72 ) 

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.

Goldman Sachs BDC, Inc.

Investor Contact: Itai Baron, 212-855-9892

Media Contact: Leslie Shribman, 212-902-5400

Source: Goldman Sachs BDC, Inc.