Goldman Sachs BDC (GSBD) 10 May 192019 Q1 Earnings call transcript

Good morning. This is Ian, and I will be your conference facilitator today. I would like to welcome everyone to the Goldman Sachs BDC, Inc.

First Quarter 2019 Earnings Conference Call. [Operator Instructions]. the to turn now will call Ms. over I Relations Sachs BDC. Schneider, Head Goldman Investor of Katherine at Katherine, begin you may your conference.

Thanks, Ian. Good morning, everyone.

Sachs today's www.goldmansachsbdc.com today's control. of forward-looking what are a financial company's uncertain condition cast begin our reproduced homepage The presentation, Inc. of future events which time filing the company's yesterday we documents with conference XX-Q as be issued Yesterday, purposes. XX, BDC, found call, our our consent. outside an Form not may may posted their the XXXX, is today, from indicated like regarding and materially, of statements on in would to Before in or copyright earnings results nature, both and by the company's recorded the release without the is those for a Goldman market to the duplicated, after and under company's listeners belief actual website that supplemental a These of remarks SEC. being SEC including statements. include be and earnings that, may statements represent I of the material closed, possibly reviewed remind company call be result rebroadcast the number should factors, time audio This described with forward-looking of those section. can May conjunction These differ, Resources Investor filings. is replay press from at This the company's in

Sachs call of BDC, over that, to the Brendan Goldman So with CEO I'll Inc. turn McGovern,

earnings call. for and everyone, our thank Good first Katherine. joining you, Thank us you morning, conference quarter for

conclude our Jonathan detail. by overview financial activity to terms results greater and call, metrics discuss And I'll in in before handing I'll our quarter there, before some Lamm portfolio for will Jon opening providing closing the for our with remarks to the first usual, over of agenda finally, From line results. it As investment an Yoder of Q&A. the start discuss

income to return share $X.XX investment with equates per was XX.X% QX, NII net which in So that, on common equity. a

by public of investment quarter, consistent a low reflects our during XXX% a company as with net income outperformance, is and long-term operating our Our coupled with performance combination covered which structure. solid expense a dividend the

we of As per end $XXX.X after record close declared of June and to debt a QX. primarily share share XX.X% asset XX, on QX driven payable announced respectively, XXXX. shareholders net the were by of yesterday, million, million and of of gross per to equates Board $XX.X as our This at investments. Gross dividend value dividend originations yield based originations a during net lien $X.XX first

the of within lien of the increased by aggregate portfolio the investments passing four has company's investments decreased Over investment XX%. past debt quarters, Credit have the first second Small proportion XX%, Act, by while Availability following debt Business its lien

structure of minimum the the balance venture in diminished. the increased sheet. Credit now ratio the Stated In produced of we determined XX%. joint In our up had venture. be regulatory risk-adjusted this Regents, the the Fund targeted simply, venture addition, on and achieved diversification we we dissolution to light attractive joint the was We that end, joint quarter name the commenced portfolio single Cal our Subsequent has partner, combination set in that us Senior of by for the getting can reduction company, asset low joint debt-to-equity utilized coverage now ratio to that utility of venture by our variety most exposure but utilize in first directly for allowed This digits. lower-risk, previous since in core leverage a a above XXXX the double lien to of the to X:X. in JV lending returns loans reasons, these applicable importantly, investments cap middle-market competency lower-yielding, inception originate to

investments, these the X, SCF As of portion May the its a the onto effective received company's investments company balance pro-rata bringing result, sheet.

well size lenders has Following as our to are this of portfolio, exposures Also is during capacity fair exposure mix, The transaction in of Small further $XXX in We overall last transaction, Business and this the increased. our XXX coupon as the latest quarter, the book joint closing commitment value Credit quarter, actions investments. name of static for sheet in diversification debt the and Availability using have end the the taken the that the the turn in optimize series the with asset we financing asset our the a the credit improves we the believe lien in total companies increase the our balance to Pro deliver first and million debt of rate. lien subsequent market at the to this XX% company's are of portfolio which company's debt change year in benefits and of shareholders. further restructuring investment our to single there strengthens number facility forma venture the of first both increased and no over of Act profile.

months pleased efforts are thus and continuing quarters far, and to results with we forward our to capture the benefits in to additional We look the come.

subsequent in made in events Animal investment filing, disclosures conference on last and call of significant in we quarter's portion our about our XX-K that recall the Supply. Finally, March earnings

we closed that the of Specifically, investment. reported on we after year-end, this restructuring

the is that From the a in the this remain our disclosure, of work described let QX NAV critical on working over investments we a mark-down management. We on underperforming remains Yoder. this With we far, have to this to significant stability investors. of a behalf this turn to are and of but Animal was a know encouraged end, stake company credit are driver significant substantial of with as investment. that, we it was performance, investment in Supply, in as thus improving financial and recent the investors, this Jon me optimize result there outcomes are maintains that the effort for This the quarter that mark by that largest To dedicated mindful of factor. success closely equity resources transaction. We outcome quarter. laser-focused we here, As decline

Brendan. right. All Thanks,

During in the the broader the market markets volatility following witnessed that stabilization we quarter. the during increased occurred fourth quarter,

Within the market, middle overall loan lower was volume historical averages. than

to with a success deals we deals our Given as we which continue parts quarter focused actually a follow-on through private to our and and first pleased this mix founder-owned capital well context, both new of Thematically, structure. were our were businesses more to platform companies, wealth lien to higher with existing in senior in XXXX. family included as sponsored as QX activity have investments continue this across investments on levels, first portfolio be bit the of of Origination and quarter referred channel. compared we

of are This companies. private quarter, the digital This his believe structure a even wealth strong during the the we CEO to began one CEO had resulted cultivated portion the partnership were currently a of facility. that from is company which network to But relationship, we a of private the experiencing. We competitive new that lead firm. to sell this to technology importance X firm a environment example over years, the the we relationship, good and Fortune in we that investment a that attractive given with investments the of trust deals CEO specializes consulting decided of origination able a originated XXX equity for lending help with transformation Tier and find

turning investment activity for to So specific the quarter.

fundings million $XXX.X and million, respectively. and commitments investment $XXX.X were New

to and new XX% originations These capital loans, the in comprised the were repayment different and XX% of and portfolio which driven seven this two primarily structure, $XX.X investments investment new both investors. preferred our that placement by were produced in repayment portfolio companies second portfolio full of companies, two stock. investments lien first companies. Regarding totaled lien quarter second attractive new Sales very lien existing loans commitments were four of million across X% activity in IRRs

with the have has of the to meaningfully and portfolio lien in of when lien second XXXX, activity As and lien - exposure the increased our At lien last within over first investment end last company's of of investments repayment quarter the investments XX% first first compared the was quarter the of result year. XX at months. a first shift origination the sales trailing we XX% portfolio, our the as coupled in occurred first end that exposure

second Our time XX% same reduced from was XX% period. of to lien over portfolio exposure the the total

the joint in the Brendan As result March XX% onto this partnership at at end And balance fourth Fund its the at fourth the have of at yield of as cost this transaction, pro-rata of total investment quarter end was the the as using This the end Senior of to lien our average of to investments company mentioned, cost average the quarter the first to first Senior the investments portfolio the resulted weighted Credit the closed income-producing transaction valuations. total of obtaining X.X% of a as debt first XX XX.X% portion quarter. the X.X% was Credit our yield The our end week. of ending weighted at of investment investments sheet. unwinding and The quarter. the increased portfolio at compared of Fund company's compared venture XX.X%

Regarding portfolio composition.

first Credit including in common comprised the X.X% secured XX% in fair of first X.X% as the the million preferred our value X.X% equity unsecured and in end X.X% in investments XX.X% well in of of Senior were lien second lien/last-out debt, unitranche senior in debt, and $X,XXX.X total portfolio quarter, As at lien, in loans, Fund. XX.X% as and

bringing as We million. commitments to XX, commitments of also total $XXX.X million had unfunded of investments March $X,XXX.X and

quarter, As companies end XX XXX portfolio different had in the across investments industries. company of the the operating XX of

of was underlying performance companies our the to So of quality. credit turning majority portfolio stable quarter-over-quarter. The

in average the fact, portfolio prior X.Xx from quarter at from debt unchanged EBITDA The to the X.Xx, of coverage down at companies company's the was end the portfolio of weighted fourth quarter. was at which interest quarter. the of end, the investment our non-investment net was quarter weighted average X.Xx In end

results. turn call to over Jonathan I through financial to the will walk So now our

portfolio XXXX first $X.XXX total Thanks, Jon. value outstanding assets and billion, quarter We $XXX with of net of the fair debt ended of million at investments $XXX million. of

in investment were Our to net compared per as the prior quarter. to quarter. per prior the share was as $X.XX negative in $X.XX Earnings income $X.XX share compared $X.XX

X.XXx end in ended We versus ratio our of average first ratio debt-to-equity X.Xx quarter, X.XXx was at the QX. the a X.XXx the versus quarter. prior quarter of debt-to-equity with During the

quarter We are balance of gradual into our pleased this income-producing assets. growth attractive additional the sheet with

we dictated in Sachs. reflection management utilization discussed practices, of core risk be asset of This by Goldman prudent are we sheet balance which As composition. will leverage prior competency higher quarters, believe is our a of

asset cushion done a historically. to the meaningful we as to We relative have maintain will seek regulatory coverage requirement

Turning to income the statement.

million, Expenses $XX.X due primarily in million was compared was up million borrowings total quarter daily were $XX.X driven The driven increase interest increase fees an Total as up to the during by from quarter quarter. in were which accelerated quarter-over-quarter $XX accretion. in Our to and for for first fees million the prior was average income investment by and $XX the quarter-over-quarter first an the an last expenses in increase increase quarter. incentive higher primarily expenses quarter. prepayment

value quarter. Now asset share prior The net last NAV it decline driver in down we was in quarter. the $XX.XX Animal $XX.XX our Supply, disclosed quarter-over-quarter, from largest we came investment at versus in QX our with ended which per

had undistributed NAV $XX on end Our accumulated to through exceeded per you from current supplemental from investment a has quarter $X.XX earnings the outstanding. to the share company fourth presentation consistently dividend. at This that the walk quarter resulting shares to net changes income investment quarter. first our million net in bridge The equates provides

size to were of revolving the facility. our the $XXX million. our million, $XXX attract We During new counterparties to with into up facility we ability first lending credit from quarter, increased the pleased

million, convertible it March grow to including I balance ample back the commitments debt. These provide prudently commitments Brendan. will unsecured capacity of XX, total debt As $XXX sheet. to to turn continue the were company company's with debt that, the With

Jonathan. Thanks,

our exceeded to investment quarter, particularly as another net report pertains pleased the income, are which We it dividend. has solid to

for look privilege your that, for forward work you continuing to the for always, the the year. on up remainder you With thank we of open the of let's As line we of for questions. behalf capital, hard and you the managing

[Operator Fargo. from the And from Finian first question O'Shea of Instructions]. is line Wells our

last of a lien company? on First it's range? the Fresh. in this volatile. know you asset sort leg-down being sequential March second a see market Or big I in of second potentially, function quarter very the performance worked quarter. kind The out and - of the be XX something of that us helping that going of was you so the lien, Country the that sense think sequential in on, - or can this a was on when the [indiscernible] risk nonaccrual about Can describe this marked

Yes.

So Jon here.

some First off, let me context. give

So It our loan of invested very capital compared a was total small position $XX the than Fresh in sheet less Country the to balance frankly to investments. is billion $X.X of million portfolio.

So little distributes fruits sponsor-backed there. to where But little and fresh-cut to a company context color, you processes and that a it's retailers. give - vegetables

thesis Our acted competitors. we was on scale the as competitive a when advantage and large thought underwriting this operational company entry nice for footprint really a the barrier made national and loan centered to that of we

lot regulations, safety because a parties. are industry being other food third growth company that increasingly also they're for and fruit held to strong We saw choosing sort This of - retailers to outsource of predominantly preparation food who, accountable food fresh-cut trends. they increased to distributes

event first increased and quarter first there and course kind of course outsourcing, this in said, which strong the the products, capital invest what some pull-through any risk a position XXXX, demand with that processing both of we healthy, your very of a course, for products right company convenient in second position. asking - throughout obviously, to lien in became prompted - at of happen the sponsor, quarter-over-quarter updated restructuring. you aware lender the definitely we our the the happened was were significant marking had capital and suggesting underlying were pleased of it given In on marks liquidity the guess big liquidity view related mark. to a focusing heart significant frankly continued below quarter was So quarter But the you quickly about of In at to move the the on to were quarter which performance and I In concerns the the we start some regardless, raw of food being gets demand the was prudent got focus pretty sort first really the consumer the during the issues. the of issues question XXXX, And during or fourth and we of of of company fourth other that our was distributing. that It lien the we sort That certain XXXX labor started additional we quickly. course XXXX. and the that of end the if moved lenders of, about at first invested Much from down with of XXXX, over cost emerge. - to of quickly quite did that But was information to this of restructuring. to updated material thought we did situation reflect of results. look the debt, company XXXX, - XXXX first quarter, the groups the

a we degree restructuring marked new now down got obviously to that of think the the that the - company, had that first midst will information position. at to reflect position And the the the the we end, mark in that of that And quarter, that the end we still we're the so first say position quarter quarter. we a subsequent of completed view the kind given the suffice I quarter, we during have the the have where of to at quite in on quarter. the so be to even quarter uncertainty end dollar say to so it's end position insignificant. see, the as will be second very the second changes likely second quarter, get we you any say, the amounts, we this with are in mark exactly of as can't first as can But any to the of of small

Obviously, what mean of situation But this about situation. far So that's to from it of information see characterize arises. it's time. was I normally the and in at sort came particularly we long kind companies. the that this started the light like would fast-moving, company rapid that which underperform or that. least fast-changing a happens as short of than a I our to at underperformance not more this And time certainly to portfolio common speed

- pretty can So much color the that's the I give.

like just business. on of you're side, may. looks to appreciate streamlining the more you? generally doing, respective it if the other each how of then continual Anything more, you might looking lines? to that see far know? entity at your and And a to streamlining news what change like is fit you your not operate you're a would the alternatives operate businesses see forth. your parent's on color. I fund such, one discussion they although, commentary of helpful and I afield distinct Or 'XX according be so to picture of an But we course, to of continuing a they're and that Seeking into the so journal it closer bank, how and Or all bank this in Act in any a - that

I'll Yes. a Fin. crack, take

trajectory resources the overall. to suffice ecosystem and look changes group, spending news and think to And is where highlight So anytime capabilities. terms is outcomes enhance our look to we've and we a no exactly there improve in at or to got certainly, ways a its had going be within new in really trying real desire overall. take focused for is group say, I But our I within a organization. firm CEO, businesses a no to where good and the we've fit think Certainly, of

might impacted be in we our any to that any the anticipate way changes foresee don't and in of here. that will pass anything don't come business So structure

James. line from Leslie Vandegrift question of Raymond next your And from the comes

so from that XXXX disruption towards because the over. of quarter, originations beginning the end more got any into quarter with Are My first quarter the spilling more disruption? of the that is deals question this kind of the on the you opportunistic of of

Yes. really. I say mean - so would not Leslie, I

thrive think our as the we sheet, people is as of approach a we to market middle and I that I call wouldn't at what the that focused - investments." you ecosystem. are to what we are investing on needed balance I I "opportunistic do lenders we point there us have side are and - we our that view of would what - of if the did going asset that nonbank of - kind on place think here, look a fundamental elements are say

and we on find - so we other that focus in on that about that think as best market And balance ancillary the when investment sheet. scanning opportunistic to types our would of more we a to as of our of portfolio. optimizing to the bring ability to strategies kind right we find the bit try financing might able of We be we our side probably at. the I say pick spots for into versus are we're deals sort looking financings

always I focus. to to as the the on middle are that's of our for we say, arrangements. market left-hand want certainly where a side, and we pursue opportunistic lending, strong view But in or place So financing we keep scanning we that continue fundamentally, opportunities situations to have a have ecosystem

that in loans. underwritten of particular, one the capital a transaction" in Brendan might The is those comfortable important Yes. be into stepping documentation not the markets Structure, perhaps here. think the aggressively way the Leslie, I'd is - shoes context in deal when the a of thing "opportunistic oftentimes with. in that structured you only of has becomes it's disruption, add about been or

trying to a attributes rather right pay the not for that prefer the might to to deal that so have. we And than define price have

might a lending certainty that deals to deals underwritten execute saw par would the they do was that what capital deals where straddling quarter private comes be ability in another attribute where oftentimes as really way, focusing be deals in bigger but credit to middle market. this think say you a floor, particular. the the I market I some been structures in we've syndication the of companies, market more tend environment within in doing were traditional for on for those quite time to opportunistic bigger

so be to And of preference heart continues the focus middle our the the market. on

seen this you've do what that's think quarter. us I

in in on the that incremental pullback Okay. - the size-wise, the companies because that exit? EBITDA press companies then the - And the existing release versus decrease Or that Is weighted average is the from the had a and originated driven discusses quarter. last the quarter? EBITDA and that by mix portfolio in

former. the It's

So It's to in of our not just left portfolio. it's been mix matter that companies. ones the of we declines terms the the that in driven versus by companies loans of are originating a EBITDA portfolio

NTS, just end then are that this And timing the expecting of question. to the the be On Okay. you last still close quarter? towards of

we're although so of - - it's anchor I is close. to best necessarily that. But I or when that yes, mean I to guesses mean - certainly, I our I largely that number anybody outside you to would mean our deal we wouldn't making control. going I there Yes. - a are think to as

approval refresh in to to operate FCC as is our acquired, of transfer system - company memory, that that, debt. licenses the debt deals a deal telecommunications is The are deal a everybody's a it's to this getting the return telecom all as been NTS owns. that receive from our for contingent we're we'll and the - on NTS acquisition, case, that's part Just

to and the what FCC we that approval than historical was have can late - the into we the when hopeful today And licenses, advisers It around quarter. expect seen and - so finish getting just own closer to review told could as our and frankly. there's announced given. transaction to what we waiting it timeline, have the no third or to FCC a we're But to the think sometime literally But projecting on to reasonable is end time we to the application you're transfer us what precedent review been be year. getting its work its transaction the quite we second for closer frame and that of last possible concluded, of assurances is on that quarter, the have slip think were certainly definitely we're based

that's bit there. of So a little color

And our SunTrust. the of is Hughes next line Mark question from from

I like public This just few many characterized on your guess I peers Ramirez as change the Michael a previously. No guess on origination is from BDC of the for follow-up question quarters. this have looks Mark. remaining It competitive. big last - environment

mentioned the this seen overall year. the You historical been data. both with originations morning has than We've that volume your new deal But lower last averages. were greater than

So came to if our you're you is your additionally, changed has And characteristics over of can percentage did quarter how avoid? question what And on this time? what that across deals, quarters? passing are close on this to deal trying some desk the that you prior when are compared we ask

have take crack so this multipart well. question, a as first some insights I'll you Yes. in here Jon,

in I own market. hard your think, any origination Michael, given versus quarter, to cadence always of it's the define sort

you at the a we your here. X that consistent, are certainly market can size different quarter, break own such another slowing the broader trends given of player platform and here. look But the In our than any described when are one company, way in or deals we're one market - of think the observations overall. are I trends X that or scale

one that in. having thing Jon were on think say if to leveraging that quarter, our is to of coming of heard diversity definition, described, opportunities. hit relative that what focus less by opportunities network us you We successful you've sources really If no change financing again with anything, as the are, competitive - wealth we private ratio, will, on we're a we're So where to deals try closing we respect there's the seeing. of consistently certainly deals this

kind think on environment. market works I in of that favor competitive of context our the So

question, we course around the environment. of other lose typically a Your in why a of I transaction might what's competitive think, was nature the

a there I factor. think comes you're debt I are the terms in EBITDA adjustments the quantum willing think key offer. that often, to service to that down that concerns the I'm market to companies made. about sure for folks most it describing, and relative you've of the Oftentimes, adjusted example, becomes capable the heard are to

quite, what platform, our disciplined to be of in an to scenario different be ourselves not offer. I common respect transactions is what to we're a financing we're underwriting be we're not is otherwise around us, perhaps where might one we marketed to and as to would say willing there a really provide the can opposed EBITDA that context For number or is us, quite in solution a we because defining as to that be. that EBITDA that winning do for competitor underwrite, an willing with try aggressive number that might

funnel you actually even Yes. down your And really think I an level points I you think there's a when to mean can higher onto a just calling you to sort here. of what that little of at add are invest in bit. - sense There's in. breaking two terms in

oftentimes that weed company. that choose to not the why is don't convey you forward of funnel a want an because may if like structure picture commentary pass by then underlying we will there - you'd that that into, - is at if And a that that is well, can to our metrics. offer comes least, And is standards, is like - that competitors this it to biggest in our all go - from sort top the one get it is I come sort of and finance, question Brendan's business we again, get what with. the get finance. the that we the bigger want we do first reality kind But But reason then as pass the our of is does underwriting comfortable or other sometimes with that far, was where saying, and the top Brendan out with out the was we starts credit be even comfortable the determine go opportunity we're when do of one the The companies they do is - around, funnel. think to majority companies you company it okay, if something in really wouldn't of are that company things and reasons that you with to this at of you like to then comfortable fundamentally a the vast it whittles and the

a on your been helpful. raise have to thresholds exceed - more, color seems to sort do you the quite over dividend? may. that, I'm times carrying that question metrics, so you be but this last Any helpful. few over be asked the we sure year, to last quarters. That's successful that dividend if of what need One comfortable four has guys been It would

Yes. over-earnings The the the portfolio the is context higher dividend of in of portfolio, yields. historical of

context that income. advantageous position over to it to capital given spill to our dividend. to be. the over equity spill mentioned, nominal We this we've more what more I cost transitioned target as been average first the certainly portfolio we spillover and recent seen and $X.XX over-earnings we do, our we have the At And market being continue, ratio versus our quarters lien weighted a trade cost cost. see don't the this raising you've increase a shareholders continues down. point, can of sense at that's excise But think makes for the to of yield of but fixed dividend investments, that we the point the As the leverage where come able terms dividend and think at our of continue we seeing in it of it's where to think we're in in point to in

of And from Arren question is our next the Cyganovich Citigroup. line from

about to Just leverage. to starting the you to your Wondering and of cost your the funds your if off impacts JV. could just forma yield, dissolution of talk investment the on pro

We'll crack the take Yes. forma. pro a at

that historically do on I been that as of the doing effectively is equity as today, of has at think produced attractive. entity, at what think dividend I here, balance end now company an we length, look investment, and you a what effectively on reflects yield can described we the investment when sheet. And we're equity quarter, which has back a the in that leveraged

our of balance sheet. sheet schedule and back those That that forma vehicle go be that within equity we Ks we'll you and were will see on lien pro the portfolio balance take So whole equity we'll so out those. Qs investment loans loans, impact that that swap off investment. diversified basically first Those all away can our within will the

which historically those is than the balance overall just you like, step a attractive will which those But business there's same look the sheet to importantly, So that course, can been up leverage, when and sheet. what nominally investments we the balance now to end finance the sheet, balance has financing most same type lower portfolio at target whole the And the is loans yield of of of to on return producing believe looks at back simplicity we a is on company. on new providers. what assets

in not So said equity, financing but leveraged first of an is loans, lots that quite lien a frankly, acquisition quite to a loans, the especially leveraged notion folks, vehicle, of with attractive whole attractive.

the course, of for lower for enhancing has vehicle, that we think our benefit that returns we a time, of net So the financing certainly company. earn which, over cost the can helps of

get in pro impacts of And that leverage but drag actual I'm just I terms I of end a just I forma is at the on modest quarter? the whole the then you're be the yield, - going There's assuming. mean level what - down that Yes. the understand on idea, quarter-to-quarter to if what's - your basis. a to

leverage the increase in them in to to the bring taking quarter yield at can and the X.Xx at was sheet is the of Senior Fund. X.X% cost Credit about average assets balance It'll is our Xs So sheet a end just X.Xx little just at And us the on bit you portfolio leverage the in weighted and context at under the bringing from those of of balance look X.XX. impact. on a

So relative to the based blend the you on. hundred can sheet $X.X that coming billion that's couple of million on on balance

- And sorry. Okay. I'm then Go ahead. incentive your

is looking I'm No. saying, just you Arren? that were for, what

the for NAV Yes. to It's zero the the part also two pretty of quarters, right? that's in assuming fourth decline. perfect. quarter. And kind a quarter of because first you're look-back I'm then the watermark past the That's fees, over-earning high low why related incentive of for but

That is correct.

of unrealized, realized investment in net net income-earning serves over-earn the the or We - portfolio, assets. portfolio attractive investment that is when net have the income. marks to we taking investment also speaks high-quality having dividend there income. - which there we're to certainly a by incentive So But the again, increase through not income fee, do and

get It's a you And your Right. vehicle then, shareholder hiccups But X% that. a that to year-over-year, have going those everybody of to And debt now investments those a wanted XX, years Is that you And of costs get low a It's it's there. have decline NAV can usually just question. everybody have friendly, was that not I you're completely back really whenever because had the has you so were - well. through But But then industry last for hopefully BDCs values some back the question, question now you, here equity more in industry of pretty it's kind kind created, investments. a I but there lost NAV ago. when of making and right. warranted in I appreciate to make it of way any to an was ability ability question the sure originally is more mezz actually as the credit it's for XX credit NAV? just that. these and you hiccup so earn earn

of an basis they're is look, so on. the answer it's on it on they investments hard as the - taking and of I decisions losses the unfortunately, mean industry-wide make to I manager answer of it Yes. part the that skill think depends really because restructuring the

think type you if if particular, you're with fixes and other hold the of whatsoever, can no so some, And possibly properly right? claim further underperformance, fewer manager - that with and no then issues you correctly, ownership and job the increase the that less and hopefully, there's some to is and on that return or capital give and your claim of company you're come you've company when did been financial So skilled literally that caused like and your underwriting out [indiscernible] your claim value that in out the - you company in a stake question that done to wiped or you yourself you've have. on rights any solely the this I restructuring claim I think on if investment to you're so if

- to thankfully, So if But a huge numerosity, we've almost look in it's most financial opportunity that were the investments, an worked, situations way retained the the and of that whatever have claim as, that look history number. on at, that - possibly every in you for our get virtually they or if not the that the as capital by us, importantly, at our underperformed you over say, we example, ownership stake a that recover the out, underperformance - of company get more. worked course, causing if have case, I so to problems

lender the nothing And so the situation you there's of opening those companies, sign you that goes when will, hard his than on mentioned you're Brendan more We in into kind if credit, can scenario. important a lot that. health is of lot a underperformed. downside that imagine. of work a there's with spend recovering that the time in That's as remarks focusing

of that's to a of lot case And the the least going by the that, at on, those depending us. manager. so I we a we But skill to that the forward. the ability means losses lot And as on have do - recover hard time of work. again, say, and it's recover case it It's spend potential

I I being I upside, think period at if of historical source maybe some mezz time, the industry has are more actually basis look you it's offering. question, on in the think of example, model with you longer and warrants sort industry equity alluded that strategic to more of your if a to over the maybe a scale a a created, been that you of things that premium through an generally currency, bit M&A been look context of for a using at the or think NAV

investment think things stable a see I performance why as to continue shareholder friendly, therefore income will focusing that in dividend net you and on us produce that are a to that going good, attractive be context. that's team management

something for that we jealously that as us something that's is that asset thoughtfully. an regard so be can And utilized

abuse pending and sorts I lose as NAV it of think types it. therefore when the I industry, look things. thoughtful at think been those to not through work. we've you about there's creation of strategic has of do that But nominal more doing to formed opposed those And the transactions ways been

comes Merrill Derek America Bank line next your question Lynch. of the And from from of Hewett

any the my will, of associated Senior questions onetime but were Most and the asked of there Fund? if maybe dissolution are with already Credit items answered, I

the have some the in of the repayment dissolution be write-off will There we credit of of there. financing a expenses facility context some deferred and that

Could Okay. that? you quantify

About $X.X million.

Please At this any remarks. no time, questions. are with there further closing continue

the Well, thank you, though, everybody, for call. for us joining conference

a Mother's follow-on Of you the Thank hesitate I don't questions, course, enjoy very have if you much. out Day to hope you please weekend. any to nice reach team.

gentlemen, and Inc. Sachs the Goldman Ladies conclude does this BDC,

Quarter you First Earnings Call. your for Conference participation. XXXX Thank

disconnect. now You may