Goldman Sachs BDC(GSBD) - 2019 Q3 - Quarterly Report

Investment Overview - The company has originated over $3.53 billion in aggregate principal amount of debt and equity investments since its formation in 2012 through September 30, 2019[224]. - As of September 30, 2019, the total investments amounted to $1,474.40 million, with a fair value of $1,430.16 million[240]. - The company focuses on lending to middle-market companies, defined as those with annual EBITDA between $5 million and $200 million[226]. - The number of portfolio companies increased to 102 as of September 30, 2019, compared to 72 as of December 31, 2018[246]. - The total investments amounted to $1,430.16 million as of September 30, 2019, compared to $1,375.44 million at December 31, 2018[253]. - The company has a common stock repurchase plan authorized for up to $25.00 million, which has been renewed multiple times, with the latest expiration set for March 18, 2020[306]. Portfolio Performance - The weighted average yield of the total portfolio as of September 30, 2019, was 8.3% at amortized cost and 8.9% at fair value[240]. - The percentage of performing debt bearing a floating rate rose to 97.9% as of September 30, 2019, from 96.6% at December 31, 2018[246]. - The median EBITDA for portfolio companies increased to $37.74 million as of September 30, 2019, compared to $26.87 million at December 31, 2018[246]. - The weighted average leverage (net debt/EBITDA) improved to 5.4x as of September 30, 2019, from 5.6x[246]. - The percentage of non-accrual investments decreased to 1.4% of total investments as of September 30, 2019, down from 8.3%[254]. - The investment performance rating showed a decrease in grade 4 investments to 1.0% of total portfolio at fair value as of September 30, 2019, from 6.4%[253]. Income and Expenses - Total investment income for Q3 2019 was $36.86 million, a decrease of 2.95% from $37.98 million in Q3 2018[260]. - Net investment income after taxes for Q3 2019 was $18.97 million, down 12.03% from $21.56 million in Q3 2018[260]. - Total expenses for Q3 2019 were $17.43 million, an increase of 9.13% from $15.99 million in Q3 2018[270]. - Interest and other debt expenses rose to $9.90 million in Q3 2019 from $6.43 million in Q3 2018, driven by higher average daily borrowings[271]. - Management fees decreased from $12.54 million for the nine months ended September 30, 2018 to $11.04 million for the same period in 2019, primarily due to a reduction in the Management Fee rate from 1.50% to 1.00%[274]. Debt and Financing - The company has a Revolving Credit Facility that allows it to borrow money to leverage its investment portfolio, subject to Investment Company Act limitations[237]. - The company entered into a Revolving Credit Facility with a committed borrowing amount of $795.00 million, which can be increased to $1,000.00 million under certain conditions[316]. - The company has a fee of 0.375% per annum on committed but undrawn amounts under the Revolving Credit Facility[317]. - The company may pursue additional capital through securitization of investments or other debt financing options, subject to market conditions and regulatory approvals[302]. - The company issued $115.00 million in unsecured Convertible Notes, generating net proceeds of approximately $110.90 million, which were used to pay down debt under the Revolving Credit Facility[321]. Valuation and Risk Management - The majority of the company's investments fall within Level 3 of the fair value hierarchy, indicating a reliance on unobservable inputs for valuation[339]. - Fair value is determined based on market prices, broker quotations, or independent third-party valuations when market prices are not available[343]. - The company engages Independent Valuation Advisors to provide independent valuations for investments not readily priced in the market[340]. - The Audit Committee reviews valuation information and assesses recommendations from the Investment Management Division Valuation Committee[348]. - The company regularly measures its exposure to interest rate risk and manages it by comparing interest rate sensitive assets to liabilities[353]. Distributions and Compliance - The company declared a quarterly distribution of $0.45 per share, payable on January 15, 2020, to holders of record as of December 31, 2019[330]. - The company intends to pay quarterly distributions to stockholders, subject to lawfully available funds, with no assurance of future distributions[346]. - The company must distribute at least 90% of its investment company taxable income annually to maintain its RIC status[347]. - The company is in compliance with covenants requiring a minimum shareholder's equity of $500.00 million and a minimum asset coverage ratio of at least 150%[319].