Goldman Sachs BDC, Inc. Reports March 31, 2024 Financial Results and Announces Quarterly Dividend of $0.45 Per Share
Goldman Sachs BDC, Inc. reported strong financial results for the first quarter of 2024, with net investment income per share of $0.55 and adjusted net investment income per share of $0.54. Earnings per share were $0.39, and the net asset value per share decreased slightly to $14.55. The company's investment portfolio comprised mainly of senior secured debt, with total investments at fair value and commitments amounting to $3,954.8 million. The Company also declared a quarterly dividend of $0.45 per share and closed a public offering of $400.0 million aggregate principal amount of unsecured notes due 2027. Despite some investments on non-accrual status, the Company's financial position remains strong.
Strong net investment income per share of $0.55 and adjusted net investment income per share of $0.54 for the quarter.
Declaring a quarterly dividend of $0.45 per share to shareholders of record.
Closing a public offering of $400.0 million aggregate principal amount of unsecured notes due 2027.
Ending net debt to equity leverage ratio improved slightly to 1.10x compared to the previous quarter.
Net asset value per share decreased slightly to $14.55 from $14.62 as of December 31, 2023.
Some investments on non-accrual status, representing 1.6% and 3.3% of the total investment portfolio at fair value and amortized cost, respectively.
Insights
The figures reported by Goldman Sachs BDC, Inc. (GSBD) for the first quarter ending March 31, 2024, indicate a consistent performance in terms of net investment income (NII) and a slight decrease in earnings per share (EPS). The NII per share of
The net asset value (NAV) per share showed a marginal decline from
The company's leverage, indicated by the ending net debt to equity ratio of 1.10x, provides insight into its capital structure. The slight reduction from 1.11x at the end of the previous quarter suggests a prudent approach to managing debt levels. Furthermore, the mix of secured and unsecured debt positions the company to potentially navigate interest rate fluctuations and credit market conditions effectively.
The dividend announcement of
An in-depth analysis of GSBD's portfolio composition reveals a heavy weighting towards senior secured debt, specifically
Another key metric, the weighted average yield on debt and income-producing investments, stands at
The credit quality in the portfolio is shown by the movement of two portfolio companies from non-accrual to accrual status, hinting at improved financial conditions of the underlying investments. However, the portfolio's weighted average leverage ratio of 6.1x and interest coverage ratio of 1.5x, while stable, should be monitored as they can signify potential stress in the portfolio companies' ability to service debt in adverse conditions.
QUARTERLY HIGHLIGHTS
-
Net investment income per share for the quarter ended March 31, 2024 was
$0.55 $0.01 $0.54 14.8% .1 Earnings per share for the quarter ended March 31, 2024 was$0.39 -
Net asset value ("NAV") per share for the quarter ended March 31, 2024 decreased
0.5% to$14.55 $14.62 -
As of March 31, 2024, the Company’s total investments at fair value and commitments were
$3,954.8 million 97.5% senior secured debt, including96.5% in first lien investments2 -
During the quarter, the Company had gross originations of
$359.6 million $116.4 million $24.9 million $115.7 million $25.6 million -
During the quarter, two portfolio companies were moved from non-accrual status to accrual status. As of March 31, 2024, investments on non-accrual status amounted to
1.6% and3.3% of the total investment portfolio at fair value and amortized cost, respectively - The Company’s ending net debt to equity ratio was 1.10x as of March 31, 2024 and 1.11x as of December 31, 2023.
-
On March 11, 2024, the Company closed a public offering of
$400.0 million 6.375% . The net proceeds from the sale of the 2027 Notes were used to pay down a portion of the Company’s secured revolving credit facility. -
As of March 31, 2024,
68.3% of the Company’s approximately$1,843.8 million 31.7% was comprised of secured debt. -
The Company’s Board of Directors declared a regular second quarter 2024 dividend of
$0.45 -
On November 15, 2023, the Company entered into an equity distribution agreement pursuant to which it may issue up to
$200 million $36.0 million $0.9 million
SELECTED FINANCIAL HIGHLIGHTS
(in $ millions, except per share data) |
|
As of
|
|
As of
|
|
||
Investment portfolio, at fair value2 |
|
$ |
3,440.1 |
|
$ |
3,414.3 |
|
Total debt outstanding4 |
|
$ |
1,843.8 |
|
$ |
1,832.2 |
|
Net assets |
|
$ |
1,631.6 |
|
$ |
1,601.8 |
|
Net asset value per share |
|
$ |
14.55 |
|
$ |
14.62 |
|
Ending net debt to equity |
|
1.10x |
|
1.11x |
|
||
(in $ millions, except per share data) |
|
Three Months Ended
|
|
Three Months Ended
|
|
||
Total investment income |
|
$ |
111.5 |
|
$ |
115.4 |
|
|
|
|
|
|
|
||
Net investment income after taxes |
|
$ |
60.8 |
|
$ |
61.8 |
|
Less: Purchase discount amortization |
|
|
1.3 |
|
|
1.1 |
|
Adjusted net investment income after taxes1 |
|
$ |
59.5 |
|
$ |
60.7 |
|
|
|
|
|
|
|
||
Net realized and unrealized gains (losses) |
|
$ |
(18.4 |
) |
$ |
(11.2 |
) |
Add: Realized/Unrealized depreciation from the purchase discount |
|
|
1.3 |
|
|
1.1 |
|
Adjusted net realized and unrealized gains (losses)1 |
|
$ |
(17.1 |
) |
$ |
(10.1 |
) |
|
|
|
|
|
|
||
Net investment income per share (basic and diluted) |
|
$ |
0.55 |
|
$ |
0.56 |
|
Less: Purchase discount amortization per share |
|
|
0.01 |
|
|
0.01 |
|
Adjusted net investment income per share1 |
|
$ |
0.54 |
|
$ |
0.55 |
|
|
|
|
|
|
|
||
Weighted average shares outstanding |
|
|
110.1 |
|
|
109.6 |
|
Regular distribution per share |
|
$ |
0.45 |
|
$ |
0.45 |
|
Total investment income for the three months ended March 31, 2024 and December 31, 2023 was
Net expenses before taxes for the three months ended March 31, 2024 and December 31, 2023 were
INVESTMENT ACTIVITY2
The following table summarizes investment activity for the three months ended March 31, 2024:
|
|
New Investment Commitments |
|
|
Sales and Repayments |
|
||||||||||
Investment Type |
|
$ Millions |
|
|
% of Total |
|
|
$ Millions |
|
|
% of Total |
|
||||
1st Lien/Senior Secured Debt |
|
$ |
344.7 |
|
|
|
95.9 |
% |
|
$ |
71.4 |
|
|
|
61.7 |
% |
1st Lien/Last-Out Unitranche |
|
|
14.9 |
|
|
|
4.1 |
|
|
|
0.1 |
|
|
|
0.1 |
|
2nd Lien/Senior Secured Debt |
|
|
— |
|
|
|
— |
|
|
|
40.1 |
|
|
|
34.7 |
|
Preferred Stock |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
Common Stock |
|
|
— |
|
|
|
— |
|
|
|
4.1 |
|
|
|
3.5 |
|
Total |
|
$ |
359.6 |
|
|
|
100.0 |
% |
|
$ |
115.7 |
|
|
|
100.0 |
% |
During the three months ended March 31, 2024, new investment commitments were across seven new portfolio companies and thirteen existing portfolio companies. Sales and repayments were primarily driven by the full repayment of our investments in four portfolio companies.
PORTFOLIO SUMMARY2
As of March 31, 2024, the Company’s investments consisted of the following:
|
|
Investments at Fair Value |
|
|||||
Investment Type |
|
$ Millions |
|
|
% of Total |
|
||
1st Lien/Senior Secured Debt |
|
$ |
3,162.7 |
|
|
|
91.9 |
% |
1st Lien/Last-Out Unitranche |
|
|
158.5 |
|
|
|
4.6 |
|
2nd Lien/Senior Secured Debt |
|
|
33.6 |
|
|
|
1.0 |
|
Unsecured Debt |
|
|
20.6 |
|
|
|
0.6 |
|
Preferred Stock |
|
|
38.0 |
|
|
|
1.1 |
|
Common Stock |
|
|
26.5 |
|
|
|
0.8 |
|
Warrants |
|
|
0.2 |
|
|
|
— |
|
Total |
|
$ |
3,440.1 |
|
|
|
100.0 |
% |
The following table presents certain selected information regarding the Company’s investments:
|
As of |
|||||||
|
|
March 31, 2024 |
|
|
December 31, 2023 |
|
||
Number of portfolio companies |
|
|
149 |
|
|
|
144 |
|
Percentage of performing debt bearing a floating rate5 |
|
|
99.4 |
% |
|
|
99.9 |
% |
Percentage of performing debt bearing a fixed rate5 |
|
|
0.6 |
% |
|
|
0.1 |
% |
Weighted average yield on debt and income producing investments, at amortized cost6 |
|
|
12.7 |
% |
|
|
12.6 |
% |
Weighted average yield on debt and income producing investments, at fair value6 |
|
|
14.1 |
% |
|
|
13.8 |
% |
Weighted average leverage (net debt/EBITDA)7 |
|
|
6.1x |
|
|
|
6.1x |
|
Weighted average interest coverage7 |
|
|
1.5x |
|
|
|
1.5x |
|
Median EBITDA7 |
|
|
|
|
|
|
|
|
As of March 31, 2024, investments on non-accrual status represented
LIQUIDITY AND CAPITAL RESOURCES
As of March 31, 2024, the Company had
The Company’s ending net debt to equity leverage ratio was 1.10x for the three months ended March 31, 2024, as compared to 1.11x for the three months ended December 31, 2023. 9
CONFERENCE CALL
The Company will host an earnings conference call on Wednesday, May 8, 2024, at 9:00 am Eastern Time. All interested parties are invited to participate in the conference call by dialing (800) 289-0459; international callers should dial +1 (929) 477-0443; conference ID 427709. 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. An archived replay will 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 generally accepted accounting principles in |
2) |
The discussion of the investment portfolio excludes the investment, if any, in a money market fund managed by an affiliate of The Goldman Sachs Group, Inc. As of March 31, 2024, the Company had an investment of |
3) |
The |
4) |
Total debt outstanding excludes netting of debt issuance costs of |
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 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 compare that amount of EBITDA to the portfolio company’s contractual interest expense (“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 excludes 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 March 31, 2024 and December 31, 2023, investments where net debt to EBITDA may not be the appropriate measure of credit risk represented |
8) |
The Company’s Revolving Credit Facility has debt outstanding denominated in currencies other than |
9) |
The ending net debt to equity leverage ratio is calculated by using the total borrowings net of cash and cash equivalents divided by equity as of March 31, 2024 and excludes unfunded commitments. |
Goldman Sachs BDC, Inc. Consolidated Statements of Assets and Liabilities (in thousands, except share and per share amounts) |
||||||||
|
|
March 31, 2024
|
|
|
December 31, 2023 |
|
||
Assets |
|
|
|
|
|
|
||
Investments, at fair value |
|
|
|
|
|
|
||
Non-controlled/non-affiliated investments (cost of |
|
$ |
3,401,026 |
|
|
$ |
3,371,910 |
|
Non-controlled affiliated investments (cost of |
|
|
39,088 |
|
|
|
42,419 |
|
Total investments, at fair value (cost of |
|
$ |
3,440,114 |
|
|
$ |
3,414,329 |
|
Investments in affiliated money market fund (cost of |
|
|
499 |
|
|
|
— |
|
Cash |
|
|
52,319 |
|
|
|
52,363 |
|
Interest and dividends receivable |
|
|
38,214 |
|
|
|
38,534 |
|
Deferred financing costs |
|
|
14,134 |
|
|
|
14,937 |
|
Other assets |
|
|
1,922 |
|
|
|
2,656 |
|
Total assets |
|
$ |
3,547,202 |
|
|
$ |
3,522,819 |
|
Liabilities |
|
|
|
|
|
|
||
Debt (net of debt issuance costs of |
|
$ |
1,830,810 |
|
|
$ |
1,826,794 |
|
Interest and other debt expenses payable |
|
|
8,758 |
|
|
|
13,369 |
|
Management fees payable |
|
|
8,732 |
|
|
|
8,708 |
|
Incentive fees payable |
|
|
10,882 |
|
|
|
13,041 |
|
Distribution payable |
|
|
50,447 |
|
|
|
49,304 |
|
Unrealized depreciation on foreign currency forward contracts |
|
|
581 |
|
|
|
726 |
|
Accrued expenses and other liabilities |
|
|
5,386 |
|
|
|
9,052 |
|
Total liabilities |
|
$ |
1,915,596 |
|
|
$ |
1,920,994 |
|
Commitments and contingencies (Note 8) |
|
|
|
|
|
|
||
Net assets |
|
|
|
|
|
|
||
Preferred stock, par value |
|
$ |
— |
|
|
$ |
— |
|
Common stock, par value |
|
|
112 |
|
|
|
110 |
|
Paid-in capital in excess of par |
|
|
1,865,489 |
|
|
|
1,827,715 |
|
Distributable earnings (loss) |
|
|
(232,574 |
) |
|
|
(224,579 |
) |
Allocated income tax expense |
|
|
(1,421 |
) |
|
|
(1,421 |
) |
Total net assets |
|
$ |
1,631,606 |
|
|
$ |
1,601,825 |
|
Total liabilities and net assets |
|
$ |
3,547,202 |
|
|
$ |
3,522,819 |
|
Net asset value per share |
|
$ |
14.55 |
|
|
$ |
14.62 |
|
Goldman Sachs BDC, Inc. Consolidated Statements of Operations (in thousands, except share and per share amounts) (Unaudited) |
||||||||
|
|
For the Three Months Ended |
|
|||||
|
|
March 31,
|
|
|
March 31,
|
|
||
Investment income: |
|
|
|
|
|
|
||
From non-controlled/non-affiliated investments: |
|
|
|
|
|
|
||
Interest income |
|
$ |
96,910 |
|
|
$ |
98,130 |
|
Payment-in-kind income |
|
|
12,646 |
|
|
|
7,717 |
|
Other income |
|
|
857 |
|
|
|
882 |
|
From non-controlled affiliated investments: |
|
|
|
|
|
|
||
Dividend income |
|
|
412 |
|
|
|
107 |
|
Interest income |
|
|
656 |
|
|
|
507 |
|
Payment-in-kind income |
|
|
55 |
|
|
|
49 |
|
Other income |
|
|
7 |
|
|
|
12 |
|
Total investment income |
|
$ |
111,543 |
|
|
$ |
107,404 |
|
Expenses: |
|
|
|
|
|
|
||
Interest and other debt expenses |
|
$ |
27,614 |
|
|
$ |
27,264 |
|
Incentive fees |
|
|
10,882 |
|
|
|
22,302 |
|
Management fees |
|
|
8,732 |
|
|
|
8,921 |
|
Professional fees |
|
|
1,110 |
|
|
|
878 |
|
Directors’ fees |
|
|
207 |
|
|
|
207 |
|
Other general and administrative expenses |
|
|
1,062 |
|
|
|
1,057 |
|
Total expenses |
|
$ |
49,607 |
|
|
$ |
60,629 |
|
Fee waivers |
|
$ |
— |
|
|
$ |
(1,986 |
) |
Net expenses |
|
$ |
49,607 |
|
|
$ |
58,643 |
|
Net investment income before taxes |
|
$ |
61,936 |
|
|
$ |
48,761 |
|
Income tax expense, including excise tax |
|
$ |
1,076 |
|
|
$ |
775 |
|
Net investment income after taxes |
|
$ |
60,860 |
|
|
$ |
47,986 |
|
Net realized and unrealized gains (losses) on investment transactions: |
|
|
|
|
|
|
||
Net realized gain (loss) from: |
|
|
|
|
|
|
||
Non-controlled/non-affiliated investments |
|
$ |
(17,646 |
) |
|
$ |
(36,261 |
) |
Non-controlled affiliated investments |
|
|
658 |
|
|
|
— |
|
Foreign currency and other transactions |
|
|
186 |
|
|
|
200 |
|
Net change in unrealized appreciation (depreciation) from: |
|
|
|
|
|
|
||
Non-controlled/non-affiliated investments |
|
|
(2,095 |
) |
|
|
18,510 |
|
Non-controlled affiliated investments |
|
|
(976 |
) |
|
|
(295 |
) |
Foreign currency forward contracts |
|
|
145 |
|
|
|
(41 |
) |
Foreign currency translations and other transactions |
|
|
1,350 |
|
|
|
(1,650 |
) |
Net realized and unrealized gains (losses) |
|
$ |
(18,378 |
) |
|
$ |
(19,537 |
) |
(Provision) benefit for taxes on realized gain/loss on investments |
|
$ |
16 |
|
|
$ |
— |
|
(Provision) benefit for taxes on unrealized appreciation/depreciation on investments |
|
|
(46 |
) |
|
|
(386 |
) |
Net increase (decrease) in net assets from operations |
|
$ |
42,452 |
|
|
$ |
28,063 |
|
Weighted average shares outstanding |
|
|
110,076,876 |
|
|
|
104,591,739 |
|
Basic and diluted net investment income per share |
|
$ |
0.55 |
|
|
$ |
0.46 |
|
Basic and diluted earnings (loss) per share |
|
$ |
0.39 |
|
|
$ |
0.27 |
|
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
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 “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.
View source version on businesswire.com: https://www.businesswire.com/news/home/20240507755397/en/
Goldman Sachs BDC, Inc.
Investor Contact: Austin Neri, 212-902-1000
Media Contact: Victoria Zarella, 212-902-5400
Source: Goldman Sachs BDC, Inc.
FAQ
What was Goldman Sachs BDC, Inc.'s net investment income per share for the first quarter of 2024?
What was the Company's quarterly dividend amount declared for the second quarter of 2024?
What was the total investment portfolio at fair value for Goldman Sachs BDC, Inc. as of March 31, 2024?
What was the Company's ending net debt to equity ratio as of March 31, 2024?
What type of investments made up the majority of the Company's investment portfolio?
