TriplePoint Venture Growth BDC Corp. Announces Second Quarter 2021 Financial Results
TriplePoint Venture Growth BDC Corp. (TPVG) announced its Q2 2021 financial results and declared a distribution of $0.36 per share for Q3 2021. Key highlights include:
- Net investment income of $9.4 million ($0.30 per share) and total income of $20.3 million.
- Increased net assets to $403.1 million ($13.03 per share) and a leverage ratio of 0.67x.
- Signed $250.8 million in term sheets with venture growth companies.
- Portfolio companies raised over $600 million.
TPVG remains positioned to benefit from strong market demand.
- Declared a distribution of $0.36 per share for Q3 2021.
- Increased signed term sheets by over 30% from the previous quarter.
- Achieved a 13.9% weighted average annualized portfolio yield on total debt investments.
- Net assets increased to $403.1 million, or $13.03 per share.
- Portfolio companies raised over $600 million in capital.
- Net investment income decreased to $9.4 million ($0.30 per share) from $11.5 million ($0.38 per share) a year earlier.
- Total investment income declined to $20.3 million from $23.8 million year-over-year.
TriplePoint Venture Growth BDC Corp. (NYSE: TPVG) (the “Company,” “TPVG,” “we,” “us,” or “our”), the leading financing provider to venture growth stage companies backed by a select group of venture capital firms in technology and other high growth industries, today announced its financial results for the second quarter ended June 30, 2021 and the declaration by its Board of Directors of its third quarter 2021 distribution of
Second Quarter 2021 Highlights
-
Signed
$250.8 million of term sheets with venture growth stage companies at TriplePoint Capital LLC (“TPC”) and TPVG closed$102.5 million of new debt commitments to venture growth stage companies; -
Funded
$76.0 million in debt investments to seven portfolio companies with a13.2% weighted average annualized portfolio yield at origination; -
Achieved a
13.9% weighted average annualized portfolio yield on total debt investments for the quarter; -
Increased net asset value to
$403.1 million , or$13.03 per share, at June 30, 2021; - TPVG portfolio companies Bird Rides, Inc., Enjoy, Inc., Inspirato LLC and Sonder, Inc. announced plans to go public through SPAC mergers and Groop Internet Platform, Inc. (d/b/a Talkspace) closed its SPAC merger;
-
Earned net investment income of
$9.4 million , or$0.30 per share, and had a net increase in net assets resulting from operations of$12.0 million , or$0.39 per share; -
Five portfolio companies raised in the aggregate over
$600 million of capital in private rounds of financing during the quarter; -
Realized a
9.5% return on average equity, based on net investment income during the quarter; - Held debt investments in 34 portfolio companies, warrants in 72 portfolio companies and equity investments in 28 portfolio companies at June 30, 2021;
-
Redeemed at par the
$74.8 million aggregate principal amount of outstanding5.75% fixed-rate notes due 2022 (the “2022 Notes”) on April 5, 2021; - Ended the quarter with a 0.67x leverage ratio;
- In April, DBRS confirmed TPVG’s investment grade rating, BBB Long-Term Issuer rating, with a stable trend outlook;
-
Declared a third quarter distribution of
$0.36 per share, payable on September 15, 2021; bringing total declared distributions to$11.14 per share since the Company’s initial public offering; and -
Subsequent to the end of the second quarter of 2021, TPVG portfolio company Revolut Ltd announced the closing of an
$800 million private equity raise at a$33 billion valuation. Based on this event, TPVG preliminarily estimates that the combined fair value range of its equity and warrant investments in Revolut Ltd is approximately$10 million to$20 million , up from a combined fair value of$1.8 million at June 30, 2021, with the final fair value subject to completion of TPVG’s quarterly valuation process for the third quarter.
Year to Date 2021 Highlights
-
Earned net investment income of
$18.3 million , or$0.59 per share, and had a net increase in net assets resulting from operations of$23.8 million , or$0.77 per share; -
Paid distributions of
$0.82 per share; -
Signed
$443.0 million of term sheets with venture growth stage companies at TPC and TPVG closed$192.9 million of new debt commitments to venture growth stage companies; -
Funded
$132.9 million in debt investments to 13 portfolio companies with a13.0% weighted average annualized portfolio yield at origination; -
Funded
$2.5 million in direct equity investments in private rounds of financing to six portfolio companies; -
Achieved a
13.6% weighted average annualized portfolio yield on total debt investments; -
Increased revolving credit facility (“Credit Facility”) capacity to
$350 million from$325 million ; -
Raised
$200 million in aggregate principal amount from the private issuance of4.50% institutional notes due 2026 (the “2026 Notes”) and used a portion of the proceeds to redeem all of the 2022 Notes; - Three TPVG portfolio companies closed their SPAC mergers and five TPVG portfolio companies announced plans to go public through SPAC mergers; and
-
Estimated undistributed taxable earnings from net investment income and realized gains of
$12.4 million , or$0.40 per share, as of June 30, 2021.
“We are pleased to have increased signed terms sheets by more than
“The prospects for our portfolio companies continue to be promising,” said Sajal Srivastava, president and chief investment officer of the Company. “Based on their continued fundraising and potential exit activity, we believe our equity and warrant investments are in a favorable position to increasingly generate capital gains for shareholders and contribute to our net asset value growth.”
PORTFOLIO AND INVESTMENT ACTIVITY
During the three months ended June 30, 2021, the Company entered into
As of June 30, 2021, the Company held debt investments in 34 portfolio companies, warrants in 72 portfolio companies and equity investments in 28 portfolio companies. The total cost and fair value of these investments were
Total portfolio investment activity for the three and six months ended June 30, 2021 and 2020 was as follows:
|
|
For the Three Months Ended
|
|
For the Six Months Ended
|
||||||||||||
(in thousands) |
|
2021 |
|
2020 |
|
2021 |
|
2020 |
||||||||
Beginning portfolio at fair value |
|
$ |
633,696 |
|
|
$ |
713,155 |
|
|
$ |
633,779 |
|
|
$ |
653,129 |
|
New debt investments, net(a) |
|
|
74,444 |
|
|
|
20,126 |
|
|
|
130,087 |
|
|
|
97,151 |
|
Scheduled principal amortization |
|
|
(23,113 |
) |
|
|
(12,134 |
) |
|
|
(38,183 |
) |
|
|
(17,947 |
) |
Principal prepayments and early repayments |
|
|
(46,000 |
) |
|
|
(25,105 |
) |
|
|
(81,966 |
) |
|
|
(26,105 |
) |
Amortization and accretion of premiums and discounts, net and end-of-term payments |
|
|
494 |
|
|
|
4,266 |
|
|
|
1,612 |
|
|
|
8,048 |
|
Payment-in-kind coupon |
|
|
2,232 |
|
|
|
2,764 |
|
|
|
4,213 |
|
|
|
3,616 |
|
New warrant investments |
|
|
2,246 |
|
|
|
153 |
|
|
|
3,867 |
|
|
|
1,227 |
|
New equity investments |
|
|
509 |
|
|
|
125 |
|
|
|
3,153 |
|
|
|
1,545 |
|
Proceeds from dispositions of investments |
|
|
- |
|
|
|
(20,658 |
) |
|
|
(15,000 |
) |
|
|
(20,658 |
) |
Net realized gains (losses) on investments |
|
|
- |
|
|
|
1,277 |
|
|
|
(15,703 |
) |
|
|
988 |
|
Net change in unrealized gains (losses) on investments |
|
|
3,209 |
|
|
|
8,884 |
|
|
|
21,858 |
|
|
|
(8,141 |
) |
Ending portfolio at fair value |
|
$ |
647,717 |
|
|
$ |
692,853 |
|
|
$ |
647,717 |
|
|
$ |
692,853 |
|
_____________ (a) Debt balance is net of fees and discounts applied to the loan at origination. |
||||||||||||||||
SIGNED TERM SHEETS
During the three months ended June 30, 2021, TPC entered into
UNFUNDED COMMITMENTS
As of June 30, 2021, the Company’s unfunded commitments totaled
RESULTS OF OPERATIONS
Total investment and other income was
Operating expenses for the second quarter of 2021 were
For the second quarter of 2021, the Company recorded net investment income of
During the second quarter of 2021, the Company recorded
Net unrealized gains on investments for the second quarter of 2021 were
The Company’s net increase in net assets resulting from operations for the second quarter of 2021 was
CREDIT QUALITY
The Company maintains a credit watch list with portfolio companies placed into one of five credit categories, with Clear, or 1, being the highest rating and Red, or 5, being the lowest. Generally, all new loans receive an initial grade of White, or 2, unless the portfolio company’s credit quality meets the characteristics of another credit category.
As of June 30, 2021, the weighted average investment ranking of the Company’s debt investment portfolio was 2.06, as compared to 2.11 at the end of the prior quarter. During the quarter ended June 30, 2021, portfolio company credit category changes, excluding fundings and repayments, consisted of the following: one portfolio company with a principal balance of
The following table shows the credit categories for the Company’s debt investments at fair value as of June 30, 2021 and December 31, 2020:
|
|
June 30, 2021 |
|
December 31, 2020 |
||||||||||||||||
Credit Category
|
|
Fair Value |
|
|
Percentage of
|
|
Number of
|
|
Fair Value |
|
|
Percentage of
|
|
Number of
|
||||||
Clear (1) |
|
$ |
42,705 |
|
|
|
7.3 |
% |
|
3 |
|
$ |
74,276 |
|
|
|
12.7 |
% |
|
5 |
White (2) |
|
|
483,280 |
|
|
|
82.7 |
|
|
29 |
|
|
413,193 |
|
|
|
70.8 |
|
|
24 |
Yellow (3) |
|
|
36,481 |
|
|
|
6.2 |
|
|
1 |
|
|
59,489 |
|
|
|
10.2 |
|
|
2 |
Orange (4) |
|
|
22,068 |
|
|
|
3.8 |
|
|
1 |
|
|
21,377 |
|
|
|
3.7 |
|
|
1 |
Red (5) |
|
|
- |
|
|
|
- |
|
|
- |
|
|
15,000 |
|
|
|
2.6 |
|
|
1 |
|
$ |
584,534 |
|
|
|
100.0 |
% |
|
34 |
|
$ |
583,335 |
|
|
|
100.0 |
% |
|
33 |
|
NET ASSET VALUE
As of June 30, 2021, the Company’s net assets were
LIQUIDITY AND CAPITAL RESOURCES
As of June 30, 2021, the Company had total liquidity of
DISTRIBUTION
On July 28, 2021, the Company’s board of directors declared a regular quarterly distribution of
SUBSEQUENT EVENTS
Since June 30, 2021 and through August 4, 2021:
-
The Company closed
$15.7 million of additional debt commitments; -
The Company funded
$18.2 million in new investments; and -
The Company received
$18.2 million of principal prepayments generating$0.4 million of accelerated income.
CONFERENCE CALL
The Company will host a conference call at 5:00 p.m. Eastern Time, today, August 4, 2021, to discuss its financial results for the quarter ended June 30, 2021. To listen to the call, investors and analysts should dial 1 (844) 826-3038 (domestic) or 1 (412) 317-5184 (international) and ask to join the TriplePoint Venture Growth BDC Corp. call. Please dial in at least five minutes before the scheduled start time. A replay of the call will be available through September 3, 2021, by dialing 1 (877) 344-7529 (domestic) or 1 (412) 317-0088 (international) and entering conference ID 10158945. The conference call will also be available via a live audio webcast in the investor relations section of the Company’s website, http://www.tpvg.com. An online archive of the webcast will be available on the Company’s website for 30 days after the call.
ABOUT TRIPLEPOINT VENTURE GROWTH BDC CORP.
TriplePoint Venture Growth BDC Corp. is an externally-managed business development company focused on providing customized debt financing with warrants and direct equity investments to venture growth stage companies in technology and other high growth industries backed by a select group of venture capital firms. The Company’s sponsor, TriplePoint Capital, is a Sand Hill Road-based global investment platform which provides customized debt financing, leasing, direct equity investments and other complementary solutions to venture capital-backed companies in technology and other high growth industries at every stage of their development with unparalleled levels of creativity, flexibility and service. For more information about TriplePoint Venture Growth BDC Corp., visit https://www.tpvg.com. For more information about the TriplePoint Capital, visit https://www.triplepointcapital.com.
FORWARD-LOOKING STATEMENTS
Certain statements contained in this press release constitute forward-looking statements. Forward-looking statements are not guarantees of future performance, condition or results and involve a number of substantial risks and uncertainties, many of which are difficult to predict and are generally beyond the Company’s control. Words such as “anticipates,” “expects,” “intends,” “plans,” “will,” “may,” “continue,” “believes,” “seeks,” “estimates,” “would,” “could,” “should,” “targets,” “projects,” and variations of these words and similar expressions are intended to identify forward-looking statements. Actual events, performance, condition or results may differ materially from those in the forward-looking statements as a result of a number of factors, including as a result of changes in economic, market or other conditions, the impact of the COVID-19 pandemic and its effects on the Company’s and its portfolio companies’ results of operations and financial condition, and those factors described from time to time in the Company’s filings with the Securities and Exchange Commission. More information on these risks and other potential factors that could affect actual events and the Company’s performance and financial results, including important factors that could cause actual results to differ materially from plans, estimates or expectations included herein or discussed on the webcast/conference call, is or will be included in the Company’s filings with the Securities and Exchange Commission, including in the “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” sections of the Company’s Annual Report on Form 10-K and Quarterly Reports on Form 10-Q. Readers are cautioned not to place undue reliance on these forward-looking statements, which reflect management’s opinions only as of the date hereof. The Company undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as may be required by law.
TriplePoint Venture Growth BDC Corp. Consolidated Statements of Assets and Liabilities (in thousands, except per share data) |
|||||||||
|
|
June 30, 2021 |
|
|
December 31, 2020 |
||||
Assets |
|
(unaudited) |
|
|
|
|
|||
Investments at fair value (amortized cost of |
|
$ |
647,717 |
|
|
|
$ |
633,779 |
|
Cash and cash equivalents |
|
|
33,443 |
|
|
|
|
38,219 |
|
Restricted cash |
|
|
- |
|
|
|
|
6,458 |
|
Deferred credit facility costs |
|
|
2,573 |
|
|
|
|
3,152 |
|
Prepaid expenses and other assets |
|
|
1,784 |
|
|
|
|
1,901 |
|
Total assets |
|
$ |
685,517 |
|
|
|
$ |
683,509 |
|
|
|
|
|
|
|
|
|
||
Liabilities |
|
|
|
|
|
|
|
||
Revolving Credit Facility |
|
$ |
- |
|
|
|
$ |
118,000 |
|
2022 Notes, net |
|
|
- |
|
|
|
|
73,964 |
|
2025 Notes, net |
|
|
69,248 |
|
|
|
|
69,148 |
|
2026 Notes, net |
|
|
197,932 |
|
|
|
|
- |
|
Other accrued expenses and liabilities |
|
|
15,209 |
|
|
|
|
21,962 |
|
Total liabilities |
|
$ |
282,389 |
|
|
|
$ |
283,074 |
|
|
|
|
|
|
|
|
|
||
Net assets |
|
|
|
|
|
|
|
||
Preferred stock, par value |
|
$ |
- |
|
|
|
$ |
- |
|
Common stock, par value |
|
|
309 |
|
|
|
|
309 |
|
Paid-in capital in excess of par value |
|
|
413,609 |
|
|
|
|
412,514 |
|
Total distributable earnings (loss) |
|
|
(10,790 |
) |
|
|
|
(12,388 |
) |
Total net assets |
|
$ |
403,128 |
|
|
|
$ |
400,435 |
|
Total liabilities and net assets |
|
$ |
685,517 |
|
|
|
$ |
683,509 |
|
|
|
|
|
|
|
|
|
||
Shares of common stock outstanding (par value |
|
|
30,950 |
|
|
|
|
30,871 |
|
Net asset value per share |
|
$ |
13.03 |
|
|
|
$ |
12.97 |
|
TriplePoint Venture Growth BDC Corp. Consolidated Statements of Operations (in thousands, except per share data) |
||||||||||||||||
|
|
For the Three Months Ended
|
|
For the Six Months Ended
|
||||||||||||
|
|
2021 |
|
2020 |
|
2021 |
|
2020 |
||||||||
|
|
(unaudited) |
|
(unaudited) |
|
(unaudited) |
|
(unaudited) |
||||||||
Investment income |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest income from investments |
|
$ |
19,743 |
|
|
$ |
23,269 |
|
|
$ |
38,933 |
|
|
$ |
43,542 |
|
Other income |
|
|
579 |
|
|
|
527 |
|
|
|
1,362 |
|
|
|
1,095 |
|
Total investment and other income |
|
$ |
20,322 |
|
|
$ |
23,796 |
|
|
$ |
40,295 |
|
|
$ |
44,637 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating expenses |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Base management fee |
|
$ |
3,146 |
|
|
$ |
3,235 |
|
|
$ |
6,070 |
|
|
$ |
6,010 |
|
Income incentive fee |
|
|
2,351 |
|
|
|
2,884 |
|
|
|
4,578 |
|
|
|
2,884 |
|
Interest expense and amortization of fees |
|
|
4,138 |
|
|
|
4,312 |
|
|
|
8,489 |
|
|
|
8,474 |
|
Administration agreement expenses |
|
|
470 |
|
|
|
574 |
|
|
|
988 |
|
|
|
1,255 |
|
General and administrative expenses |
|
|
814 |
|
|
|
1,255 |
|
|
|
1,860 |
|
|
|
2,241 |
|
Total operating expenses |
|
$ |
10,919 |
|
|
$ |
12,260 |
|
|
$ |
21,985 |
|
|
$ |
20,864 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net investment income |
|
$ |
9,403 |
|
|
$ |
11,536 |
|
|
$ |
18,310 |
|
|
$ |
23,773 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net realized and unrealized gains (losses) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net realized gains (losses) on investments |
|
$ |
55 |
|
|
$ |
801 |
|
|
$ |
(15,642 |
) |
|
$ |
471 |
|
Net change in unrealized gains (losses) on investments |
|
|
3,209 |
|
|
|
8,885 |
|
|
|
21,858 |
|
|
|
(8,140 |
) |
Net realized loss on extinguishment of debt |
|
|
(681 |
) |
|
|
- |
|
|
|
(681 |
) |
|
|
- |
|
Net realized and unrealized gains (losses) |
|
$ |
2,583 |
|
|
$ |
9,686 |
|
|
$ |
5,535 |
|
|
$ |
(7,669 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net increase in net assets resulting from operations |
|
$ |
11,986 |
|
|
$ |
21,222 |
|
|
$ |
23,845 |
|
|
$ |
16,104 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic and diluted net investment income per share |
|
$ |
0.30 |
|
|
$ |
0.38 |
|
|
$ |
0.59 |
|
|
$ |
0.78 |
|
Basic and diluted net increase in net assets per share |
|
$ |
0.39 |
|
|
$ |
0.69 |
|
|
$ |
0.77 |
|
|
$ |
0.53 |
|
Basic and diluted weighted average shares of common stock outstanding |
|
|
30,917 |
|
|
|
30,747 |
|
|
|
30,899 |
|
|
|
30,315 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic and diluted distributions declared per share |
|
$ |
0.36 |
|
|
$ |
0.36 |
|
|
$ |
0.72 |
|
|
$ |
0.72 |
|
Weighted Average Portfolio Yield on Total Debt Investments |
||||||||||||||||
Ratios |
|
For the Three Months Ended
|
|
For the Six Months Ended
|
||||||||||||
(Percentages, on an annualized basis)(1) |
|
2021 |
|
2020 |
|
2021 |
|
2020 |
||||||||
Weighted average portfolio yield on total debt investments(2) |
|
|
13.9 |
% |
|
|
13.7 |
% |
|
|
13.6 |
% |
|
|
13.2 |
% |
Coupon income |
|
|
9.9 |
% |
|
|
10.1 |
% |
|
|
9.8 |
% |
|
|
10.0 |
% |
Accretion of discount |
|
|
0.7 |
% |
|
|
0.9 |
% |
|
|
0.7 |
% |
|
|
1.0 |
% |
Accretion of end-of-term payments |
|
|
1.4 |
% |
|
|
1.7 |
% |
|
|
1.4 |
% |
|
|
1.7 |
% |
Impact of prepayments during the period |
|
|
1.9 |
% |
|
|
1.0 |
% |
|
|
1.7 |
% |
|
|
0.5 |
% |
_____________ |
||
(1) |
Weighted average portfolio yields on total debt investments for periods shown are the annualized rates of interest income recognized during the period divided by the average amortized cost of debt investments in the portfolio during the period. |
|
(2) |
The weighted average portfolio yields on total debt investments reflected above do not represent actual investment returns to the Company’s stockholders. |
|
View source version on businesswire.com: https://www.businesswire.com/news/home/20210804006081/en/
FAQ
What were the financial results for TPVG in Q2 2021?
What distribution was declared by TPVG for Q3 2021?
How much did TPVG sign in term sheets with venture growth companies?
What was TPVG's leverage ratio at the end of Q2 2021?
What was the net asset value per share for TPVG as of June 30, 2021?
