TriplePoint Venture Growth(TPVG) - 2025 Q1 - Quarterly Report

PART I. FINANCIAL INFORMATION This section presents unaudited consolidated financial statements and management's discussion of financial condition and results Item 1. Financial Statements (Unaudited) This section presents the unaudited consolidated financial statements, including key financial statements and explanatory notes Consolidated Statements of Assets and Liabilities This statement details the company's financial position, presenting assets, liabilities, and net assets at reporting dates Assets and Liabilities Overview (March 31, 2025 vs. December 31, 2024) | Metric | March 31, 2025 (in thousands) | December 31, 2024 (in thousands) | | :-------------------------------- | :----------------------------- | :----------------------------- | | Total Assets | $734,837 | $763,040 | | Total Liabilities | $387,869 | $417,353 | | Total Net Assets | $346,968 | $345,687 | | Net Asset Value per Share | $8.62 | $8.61 | | Shares Outstanding | 40,233 | 40,137 | - Total assets decreased by $28.2 million, primarily due to a decrease in cash and restricted cash[12] - Total liabilities decreased by $29.5 million, mainly due to the repayment of 2025 Notes, partially offset by the issuance of 2028 Notes[12] - Net assets increased slightly by $1.3 million, and NAV per share saw a marginal increase[12] - Investment at fair value increased by $5.76 million QoQ, from $676.25 million on December 31, 2024, to $682.01 million on March 31, 2025[12] Consolidated Statements of Operations This statement presents the company's revenues, expenses, and net income or loss over specific reporting periods Key Financial Performance (Three Months Ended March 31, 2025 vs. 2024) | Metric | Q1 2025 (in thousands) | Q1 2024 (in thousands) | | :------------------------------------------ | :--------------------- | :--------------------- | | Total Investment and Other Income | $22,454 | $29,273 | | Total Operating Expenses | $11,716 | $13,750 | | Net Investment Income | $10,738 | $15,523 | | Net Realized Gains (Losses) on Investments | $2,254 | $(8,807) | | Net Change in Unrealized Gains (Losses) on Investments | $(303) | $1,263 | | Net Increase (Decrease) in Net Assets from Operations | $12,689 | $7,979 | | Net Investment Income per Share | $0.27 | $0.41 | | Net Increase (Decrease) in Net Assets per Share | $0.32 | $0.21 | | Regular Distributions Declared per Share | $0.30 | $0.40 | - Total investment income decreased by $6.8 million, while operating expenses decreased by $2.0 million[14] - Net investment income decreased by $4.8 million[14] - The company swung from net realized losses in Q1 2024 to net realized gains in Q1 2025, contributing to a $4.7 million increase in net assets from operations[14] - Net investment income per share decreased, but net increase in net assets per share improved[14] - Interest income from investments decreased by $6.91 million YoY, from $24.74 million in Q1 2024 to $17.83 million in Q1 2025[14] Consolidated Statements of Changes in Net Assets This statement outlines the changes in the company's net assets over a period, reflecting operations and distributions Net Assets Evolution (Three Months Ended March 31, 2025 vs. 2024) | Metric | March 31, 2025 (in thousands) | March 31, 2024 (in thousands) | | :------------------------------------------ | :----------------------------- | :----------------------------- | | Balance as of December 31 (prior year) | $345,687 | $346,306 | | Net increase (decrease) in net assets from operations | $12,689 | $7,979 | | Distributions reinvested in common stock | $633 | $828 | | Distributions from distributable earnings | $(12,041) | $(15,101) | | Balance as of March 31 | $346,968 | $341,267 | - Net assets increased by $1.3 million to $346.97 million as of March 31, 2025, driven by higher net increase from operations and distributions reinvested[16] - This increase was partially offset by distributions from distributable earnings[16] - Common stock shares outstanding increased by 2,387 thousand YoY, from 37,846 thousand shares on March 31, 2024, to 40,233 thousand shares on March 31, 2025[16] Consolidated Statements of Cash Flows This statement summarizes the cash inflows and outflows from operating, investing, and financing activities Cash Flow Summary (Three Months Ended March 31, 2025 vs. 2024) | Metric | Q1 2025 (in thousands) | Q1 2024 (in thousands) | | :------------------------------------------ | :--------------------- | :--------------------- | | Net cash (used in) provided by operating activities | $(4,908) | $18,199 | | Net cash provided by (used in) financing activities | $(32,109) | $(189,018) | | Net change in cash, cash equivalents and restricted cash | $(37,017) | $(170,819) | | Cash, cash equivalents and restricted cash at end of period | $41,710 | $763 | - Net cash used in operating activities increased significantly in Q1 2025 compared to Q1 2024, primarily due to higher fundings of investments and changes in operating assets/liabilities[19] - Net cash used in financing activities decreased substantially due to the issuance of 2028 Notes and lower repayments under the revolving credit facility[19] - This led to a much smaller net decrease in total cash and equivalents[19] - In Q1 2025, the Company repaid $70.0 million of 2025 Notes and issued $50.0 million of 2028 Notes[19] Consolidated Schedules of Investments This section provides a detailed listing of the company's investment portfolio, categorized by type and industry Portfolio Overview (March 31, 2025 vs. December 31, 2024) | Investment Type | March 31, 2025 (Fair Value, in thousands) | December 31, 2024 (Fair Value, in thousands) | | :-------------------------------- | :--------------------------------------- | :--------------------------------------- | | Debt Investments | $565,413 | $560,105 | | Warrant Investments | $41,997 | $39,963 | | Equity Investments | $74,602 | $76,181 | | Total Investments | $682,012 | $676,249 | | Number of Investments | 303 | 300 | | Number of Companies | 114 | 109 | - The total investment portfolio increased by $5.76 million QoQ, primarily driven by increases in debt and warrant investments[204][205] - This increase was partially offset by a slight decrease in equity investments, while the number of portfolio companies and total investments also increased[204][205] Top 5 Industries by Fair Value (March 31, 2025) | Industry | Fair Value (in thousands) | Percentage of Total Investments | | :-------------------------------- | :------------------------ | :----------------------------------- | | Consumer Products and Services | $105,078 | 15.4% | | E-Commerce - Clothing and Accessories | $100,824 | 14.8% | | Financial Institution and Services | $96,324 | 14.1% | | Healthcare Technology Systems | $65,424 | 9.6% | | Business Applications Software | $38,969 | 5.7% | Notes to Consolidated Financial Statements This section provides detailed explanations and disclosures supporting the consolidated financial statements - The financial statements are prepared in conformity with GAAP for interim information, omitting certain annual disclosures[84] - The Company consolidates its wholly-owned subsidiaries, TPVG Variable Funding Company LLC and TPVG Investment LLC[84][85] - The Company's investment objective is to maximize total return to stockholders primarily through current income from secured loans and capital gains from equity 'kickers' to venture growth stage companies[82] Note 1. Organization This note describes the company's formation, regulatory status, and investment objectives - TriplePoint Venture Growth BDC Corp. is a Maryland corporation, formed June 28, 2013, and commenced investment operations March 5, 2014[81] - It is an externally-managed, closed-end investment company regulated as a BDC and intends to qualify as a RIC[81] - The Company's investment objective is to maximize total return to stockholders primarily through current income and capital appreciation by lending to venture growth stage companies[82] - These companies are in technology and other high-growth industries, backed by leading venture capital investors[82] - The Company is managed by TriplePoint Advisers LLC (the "Adviser") and administered by TriplePoint Administrator LLC (the "Administrator"), both wholly-owned subsidiaries of TPC[82] Note 2. Significant Accounting Policies This note outlines the key accounting principles and methods used in preparing the financial statements - Interim consolidated financial statements are prepared in conformity with GAAP for interim financial information and SEC reporting requirements, omitting certain annual disclosures[84] - Consolidated financial statements include the Company and its wholly-owned subsidiaries, with all intercompany balances and transactions eliminated[85] Note 3. Related Party Agreements and Transactions This note details agreements and transactions between the company and its related parties, including management fees - The Company pays its Adviser a base management fee (1.75% annually of average adjusted gross assets) and an incentive fee (20% of net investment income and net capital gains) for investment management services[90][91][92] - For Q1-Q4 2025, the Adviser agreed to waive the income incentive fee if, after payment, the Company's net investment income per share is below the quarterly distribution per share[94] Management and Incentive Fees (Q1 2025 vs. Q1 2024) | Fee Type | Q1 2025 (in thousands) | Q1 2024 (in thousands) | | :-------------------- | :--------------------- | :--------------------- | | Base management fee | $3,326 | $4,302 | | Income incentive fee | $0 | $0 | | Capital gains incentive fee | $0 | $0 | Note 4. Investments This note describes the company's investment valuation policies and provides details on investment activity - Investments are measured at fair value in accordance with ASC Topic 820, using a hierarchy of valuation techniques (Level 1, 2, and 3) based on observability of inputs[102][105][106] - The Board, with assistance from the Adviser and independent valuation agents, determines fair value quarterly for investments without readily available market quotations[104] - This primarily uses discounted cash flow models for debt and Black Scholes for warrants[110][116] Level 3 Investment Activity (Three Months Ended March 31, 2025) | Activity | Debt Investments (in thousands) | Warrant Investments (in thousands) | Equity Investments (in thousands) | Total (in thousands) | | :------------------------------------------ | :------------------------------ | :------------------------------- | :------------------------------ | :------------------- | | Fair value as of Dec 31, 2024 | $560,105 | $39,963 | $75,565 | $675,633 | | Funding and purchases of investments, at cost | $27,327 | $762 | $448 | $28,537 | | Principal payments and sale proceeds | $(27,663) | $0 | $(2,308) | $(29,971) | | Net change in unrealized gains (losses) | $422 | $1,272 | $(1,911) | $(217) | | Fair value as of Mar 31, 2025 | $565,413 | $41,997 | $74,072 | $681,482 | Note 5. Credit Risk This note discusses the credit risks associated with the company's debt investments and their potential impact - Debt investments are subject to business, financial market, or legal uncertainties, with volatile prices affected by economic and political developments[132] - Repayment ability often depends on additional funding from venture capital investors, future sales, or IPOs[133] - Default risks, insufficient collateral, and high collection costs can negatively impact investment value[133] Note 6. Borrowings This note provides details on the company's outstanding debt, credit facilities, and related interest expenses Outstanding Debt (March 31, 2025 vs. December 31, 2024) | Liability | March 31, 2025 (Outstanding, in thousands) | December 31, 2024 (Outstanding, in thousands) | | :------------------------ | :--------------------------------------- | :--------------------------------------- | | Revolving Credit Facility | $5,000 | $5,000 | | 2025 Notes, net | $0 | $69,948 | | 2026 Notes, net | $199,594 | $199,483 | | 2027 Notes, net | $124,466 | $124,396 | | 2028 Notes, net | $49,328 | $0 | | Total Borrowings Outstanding, net | $374,888 | $394,923 | - Total borrowings outstanding decreased by $20.04 million QoQ, primarily due to the repayment of the $70.0 million 2025 Notes[135] - This was partially offset by the issuance of $50.0 million in 2028 Notes[135] Interest Expense and Amortization of Fees (Q1 2025 vs. Q1 2024) | Expense Type | Q1 2025 (in thousands) | Q1 2024 (in thousands) | | :-------------------------------- | :--------------------- | :--------------------- | | Revolving Credit Facility Total | $1,095 | $2,178 | | 2025 Notes Total | $726 | $840 | | 2026 Notes Total | $2,361 | $2,361 | | 2027 Notes Total | $1,632 | $1,632 | | 2028 Notes Total | $558 | $0 | | Total Interest Expense and Amortization | $6,372 | $7,011 | Note 7. Commitments and Contingencies This note discloses the company's unfunded commitments and potential contingent liabilities Unfunded Commitments (March 31, 2025 vs. December 31, 2024) | Metric | March 31, 2025 (in thousands) | December 31, 2024 (in thousands) | | :-------------------------------- | :----------------------------- | :----------------------------- | | Total Unfunded Commitments | $116,842 | $104,540 | | Dependent on milestones | $19,100 | $9,100 | | Fair Value of Unfunded Commitment Liability | $1,003 | $920 | - Total unfunded commitments increased by $12.3 million QoQ to $116.8 million, with $19.1 million dependent on portfolio company milestones[162][163][166] - The fair value of the unfunded commitment liability also increased slightly to $1.0 million[162][163][166] Unfunded Commitments Activity (Q1 2025 vs. Q1 2024) | Activity | Q1 2025 (in thousands) | Q1 2024 (in thousands) | | :------------------------------------------ | :--------------------- | :--------------------- | | New commitments | $76,500 | $10,000 | | Fundings | $(27,676) | $(13,500) | | Expirations / Terminations | $(36,522) | $(41,510) | Note 8. Financial Highlights This note provides key financial performance metrics and ratios on a per-share and annualized basis Per Share Data (Q1 2025 vs. Q1 2024) | Metric | Q1 2025 | Q1 2024 | | :------------------------------------------ | :------ | :------ | | Net asset value at beginning of period | $8.61 | $9.21 | | Net investment income per share | $0.27 | $0.41 | | Net increase (decrease) in net assets per share | $0.32 | $0.21 | | Regular distributions declared per share | $0.30 | $0.40 | | Net asset value at end of period | $8.62 | $9.02 | Ratios / Supplemental Data (Q1 2025 vs. Q1 2024, annualized) | Metric | Q1 2025 | Q1 2024 | | :------------------------------------------ | :------ | :------ | | Total return based on net asset value per share | 4.7% | 2.4% | | Total return based on stock price | (1.1)% | (8.8)% | | Net investment income to average net asset value | 12.5% | 17.9% | | Net increase (decrease) in net assets to average net asset value | 14.8% | 9.2% | | Ratio of expenses to average net asset value | 13.7% | 15.8% | Weighted Average Annualized Portfolio Yield on Debt Investments (Q1 2025 vs. Q1 2024) | Metric | Q1 2025 | Q1 2024 | | :------------------------------------------ | :------ | :------ | | Weighted average portfolio yield on debt investments | 14.4% | 15.4% | | Coupon income | 11.6% | 12.2% | | Accretion of discount | 1.2% | 0.9% | | Accretion of end-of-term payments | 1.3% | 1.6% | | Impact of prepayments during the period | 0.3% | 0.7% | Note 9. Net Increase (Decrease) in Net Assets per Share This note details the per-share performance metrics related to net assets from operations Per Share Performance (Q1 2025 vs. Q1 2024) | Metric | Q1 2025 | Q1 2024 | | :------------------------------------------ | :------ | :------ | | Net investment income per share | $0.27 | $0.41 | | Net increase (decrease) in net assets from operations per share | $0.32 | $0.21 | | Weighted average shares of common stock outstanding | 40,138 | 37,649 | - Net investment income per share decreased by $0.14 YoY, while net increase in net assets from operations per share increased by $0.11 YoY[175] Note 10. Equity This note provides information on the company's common stock, share offerings, and equity programs - Since inception through March 31, 2025, the Company issued 34,999,352 shares of common stock through various offerings, raising $488.1 million in net proceeds[176] - In Q1 2025, 95,000 shares were issued for distribution reinvestment, generating $0.633 million[179] - In Q1 2024, 133,000 shares were sold under the 2022 Sales Agreement, generating $1.3 million in net proceeds[181] - The Company terminated its $50.0 million Prior ATM Program and entered into a new $75.0 million Current ATM Program on May 2, 2024[178][179] - As of March 31, 2025, $56.5 million remained available under the Current ATM Program[178][179] Note 11. Distributions This note details the company's distribution policies, requirements for RIC status, and excise tax implications - To maintain RIC status, the Company must distribute at least 90% of its net ordinary income and net realized short-term capital gains (net of long-term capital losses)[183] - The Company was subject to a 4% U.S. federal excise tax for tax years ended December 31, 2024 and 2023, due to not meeting distribution requirements[184] - For Q1 2025, a $0.30 per share distribution was declared and paid, representing distributions from ordinary income, with 71.6% from interest-sourced distributions[186][188][284] - Total distributions since inception amount to $16.35 per share[186][188][284] Note 12. Operating Segments This note explains the company's operating segment structure and relevant accounting pronouncements - The Company operates as a single operating segment, as determined by its Chief Operating Decision Maker (CEO and CFO), based on its sole investment objective[189] - This objective is to maximize total return to stockholders primarily through current income from secured loans and capital gains from equity "kickers"[189] - The Company adopted ASU 2023-07, Segment Reporting (Topic 280), effective for fiscal years beginning after December 15, 2023, which enhances disclosures about significant segment expenses and clarifies reporting for single-segment entities[286] Note 13. Subsequent Events This note discloses significant events that occurred after the reporting period but before the financial statements were issued - On April 30, 2025, the Board declared a $0.30 per share regular quarterly distribution payable on June 30, 2025[191] - From April 1, 2025, through May 6, 2025, the Company closed $82.0 million of additional debt commitments and funded $50.2 million in new investments[192] - TPC's direct originations platform entered into $92.7 million of additional non-binding signed term sheets[192] Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations This section provides management's perspective on the company's financial condition, operational results, and future outlook Forward-Looking Statements This section cautions readers that the report contains forward-looking statements subject to various risks and uncertainties - The report contains forward-looking statements based on current expectations, estimates, and projections, which are not historical facts and involve substantial risks and uncertainties[194] - These statements are subject to risks such as future operating results, relationships with third parties, unfunded commitments, market for venture capital investments, conflicts of interest, economic conditions, financing abilities, and regulatory compliance[195] - Assumptions underlying these statements, including ability to originate new loans, borrowing costs, profitability, and capital availability, could prove inaccurate, leading to material differences in actual results[196] Overview This section provides a general introduction to the company, its regulatory status, and investment objectives - TriplePoint Venture Growth BDC Corp. is an externally managed, closed-end management investment company regulated as a BDC and intends to qualify as a RIC[197] - Its shares are listed on the NYSE under "TPVG"[197] - The Company's investment objective is to maximize total return to stockholders primarily through current income (lending with warrants) and capital appreciation, targeting venture growth stage companies backed by leading venture capital investors[199] Portfolio Composition, Investment Activity and Asset Quality This section analyzes the structure of the investment portfolio, recent investment transactions, and the quality of assets - The Company invests primarily in growth capital loans, equipment financings, and revolving loans, typically receiving warrant investments for equity appreciation[200] - It may also invest in other lifecycle stages[200] Portfolio Composition This subsection details the types and distribution of investments within the company's portfolio Total Investments (March 31, 2025 vs. December 31, 2024) | Metric | March 31, 2025 | December 31, 2024 | | :-------------------------------- | :------------- | :---------------- | | Number of Investments | 303 | 300 | | Number of Companies | 114 | 109 | | Aggregate Cost (in thousands) | $719,798 | $713,732 | | Aggregate Fair Value (in thousands) | $682,012 | $676,249 | - As of March 31, 2025, the Company had 303 investments in 114 companies, with an aggregate fair value of $682.0 million[201][204] - Debt investments comprised $565.4 million of this, with a weighted average loan to enterprise value ratio of 7.7% at underwriting[201][204] Top 5 Industries by Fair Value (March 31, 2025) | Industry | Fair Value (in thousands) | Percentage of Total Investments | | :-------------------------------- | :------------------------ | :----------------------------------- | | Consumer Products and Services | $105,078 | 15.4% | | E-Commerce - Clothing and Accessories | $100,824 | 14.8% | | Financial Institution and Services | $96,324 | 14.1% | | Healthcare Technology Systems | $65,424 | 9.6% | | Business Applications Software | $38,969 | 5.7% | Investment Activity This subsection summarizes the company's investment and divestment transactions during the reporting period - During Q1 2025, the Company entered into $76.5 million in new debt commitments, funded $27.7 million in debt investments (weighted average yield of 13.3%), and acquired $0.8 million in warrant investments[211][212] - During Q1 2025, the Company received $17.0 million in principal prepayments, $0.8 million in early repayments, and $9.9 million in scheduled principal amortization[214] Total Portfolio Investment Activity (Q1 2025 vs. Q1 2024) | Metric | Q1 2025 (in thousands) | Q1 2024 (in thousands) | | :------------------------------------------ | :--------------------- | :--------------------- | | Beginning portfolio at fair value | $676,249 | $802,145 | | New debt investments, net | $27,327 | $13,155 | | Principal prepayments and early repayments | $(17,782) | $(30,842) | | Net realized gains (losses) on investments | $2,278 | $(8,951) | | Net change in unrealized gains (losses) on investments | $(303) | $1,263 | | Ending portfolio at fair value | $682,012 | $773,605 | Asset Quality This subsection assesses the credit quality and risk profile of the company's debt investment portfolio - The Adviser maintains a five-category Credit Watch List (1=best, 5=worst) to assess borrower risk, with new loans generally assigned a rating of 2 (White)[219][220] Debt Investment Credit Categories (March 31, 2025 vs. December 31, 2024, Fair Value in thousands) | Credit Category | March 31, 2025 | December 31, 2024 | | :-------------- | :------------- | :---------------- | | Clear (1) | $50,624 | $51,986 | | White (2) | $428,404 | $392,237 | | Yellow (3) | $54,964 | $84,847 | | Orange (4) | $31,365 | $30,979 | | Red (5) | $56 | $56 | - The weighted average investment ranking of the debt investment portfolio improved from 2.17 as of December 31, 2024, to 2.12 as of March 31, 2025[220] - Four portfolio companies remained on non-accrual status[221] Results of Operations This section analyzes the company's financial performance, including investment income, expenses, and gains/losses - Net increase (decrease) in net assets resulting from operations is a key measure, comprising net investment income (loss), net realized gains (losses), and net unrealized gains (losses)[222] Comparison of Operating Results (Q1 2025 vs Q1 2024) This subsection compares the company's overall operating performance between the current and prior year's first quarter Net Assets from Operations (Q1 2025 vs. Q1 2024) | Metric | Q1 2025 (in thousands) | Q1 2024 (in thousands) | | :------------------------------------------ | :--------------------- | :--------------------- | | Net increase in net assets from operations | $12,700 | $8,000 | | Net investment income | $10,700 | $15,500 | | Net realized and unrealized gains (losses) | $2,000 | $(7,500) | - Net increase in net assets from operations rose to $12.7 million in Q1 2025 from $8.0 million in Q1 2024, primarily due to a swing from net realized and unrealized losses to gains[223] - Net investment income per share decreased from $0.41 in Q1 2024 to $0.27 in Q1 2025, while net increase in net assets from operations per share increased from $0.21 to $0.32[223] Investment Income This subsection analyzes the sources and changes in the company's total investment and other income - Total investment and other income decreased by $6.8 million YoY, from $29.3 million in Q1 2024 to $22.5 million in Q1 2025[225] - This was primarily due to a lower weighted average principal amount outstanding on income-bearing debt investments and lower investment yields from decreases in the Prime rate[225] - Other income in Q1 2025 was $0.9 million, consisting of $0.4 million from termination/expiration of unfunded commitments and $0.4 million from other fees[226] Operating Expenses This subsection details the company's operating expenses, including management fees and interest expense - Total operating expenses decreased by $2.1 million YoY, from $13.8 million in Q1 2024 to $11.7 million in Q1 2025[228] - Base management fees decreased by $1.0 million YoY to $3.3 million in Q1 2025, primarily due to a smaller average portfolio size[229][230][231] - No income or capital gains incentive fees were recorded in either period[229][230][231] - Interest expense and amortization of fees decreased by $0.6 million YoY to $6.4 million in Q1 2025, mainly due to a lower weighted-average outstanding principal balance under the Credit Facility[231] Net Realized and Unrealized Gains and Losses This subsection analyzes the realized and unrealized gains and losses on the company's investments - In Q1 2025, the Company recognized $2.3 million in net realized gains, primarily from the partial sale of equity in one portfolio company[233][234] - This represents a significant improvement from $8.8 million in net realized losses in Q1 2024[233][234] - Net change in unrealized losses was $0.3 million in Q1 2025, compared to net unrealized gains of $1.3 million in Q1 2024[235][236] - This was influenced by reversals of prior gains and debt portfolio adjustments, partially offset by foreign currency and warrant/equity gains[235][236] Portfolio Yield and Total Return This subsection examines the yield generated by the investment portfolio and the company's overall total return performance Weighted Average Annualized Portfolio Yield on Debt Investments (Q1 2025 vs. Q1 2024) | Metric | Q1 2025 | Q1 2024 | | :------------------------------------------ | :------ | :------ | | Weighted average portfolio yield on debt investments | 14.4% | 15.4% | | Coupon income | 11.6% | 12.2% | | Accretion of discount | 1.2% | 0.9% | | Accretion of end-of-term payments | 1.3% | 1.6% | | Impact of prepayments during the period | 0.3% | 0.7% | Total Return (Q1 2025 vs. Q1 2024) | Metric | Q1 2025 | Q1 2024 | | :------------------------------------------ | :------ | :------ | | Total return based on NAV per share | 4.7% | 2.4% | | Total return based on stock price | (1.1)% | (8.8)% | Returns on Net Asset Value and Total Assets (Q1 2025 vs. Q1 2024, annualized) | Metric | Q1 2025 | Q1 2024 | | :------------------------------------------ | :------ | :------ | | Net investment income to average net asset value | 12.5% | 17.9% | | Net increase (decrease) in net assets to average net asset value | 14.8% | 9.2% | | Net investment income to average total assets | 5.6% | 7.6% | | Net increase (decrease) in net assets to average total assets | 6.6% | 3.9% | Critical Accounting Policies This section highlights the accounting policies that require significant judgment and estimation by management - The valuation of the investment portfolio is identified as a critical accounting policy, requiring significant management judgment due to inherent uncertainties in valuing privately held investments[247][249] - Investments are carried at fair value in accordance with ASC Topic 946 and measured under ASC Topic 820, with the Board approving the valuation methodology and responsible for fair values[248][249] - As of March 31, 2025, the investment portfolio, valued at fair value, represented 92.8% of total assets, up from 88.6% as of December 31, 2024[250] Liquidity and Capital Resources This section discusses the company's ability to meet its financial obligations and fund its operations and investments - The Company expects current cash, available borrowing capacity, anticipated cash flows from operations, and ability to liquidate publicly traded investments to be adequate for daily operations and unfunded commitments[252] - As a BDC, the Company has an ongoing need to raise additional capital and explores options like expanding the Credit Facility or issuing additional equity/debt securities[256] Cash Flows This subsection analyzes the company's cash inflows and outflows from operating and financing activities - In Q1 2025, net cash used in operating activities was $4.9 million, and net cash used in financing activities was $32.1 million[254] - This resulted in $41.7 million in cash and cash equivalents (including restricted cash) at period end[254] - In Q1 2024, net cash provided by operating activities was $18.2 million, while net cash used in financing activities was $189.0 million[255] - This resulted in $0.8 million in cash and cash equivalents (including restricted cash) at period end[255] Capital Resources and Borrowings This subsection details the company's available capital, credit facilities, and outstanding debt instruments - The Credit Facility has $300.0 million in total commitments (with an accordion feature up to $400.0 million), with $5.0 million outstanding and $295.0 million remaining capacity as of March 31, 2025[257][258] - The $70.0 million 2025 Notes were repaid in March 2025[259] - The Company has $200.0 million in 2026 Notes (4.50%, due March 2026), $125.0 million in 2027 Notes (5.00%, due February 2027), and issued $50.0 million in 2028 Notes (8.11%, due February 2028) in February 2025[260][262][264] - The Company terminated its 2022 Sales Agreement and entered into a new 2024 Sales Agreement for up to $75.0 million in common stock sales[266][267][268] - As of March 31, 2025, $56.5 million remained available under the Current ATM Program[266][267][268] Asset Coverage Requirements This subsection explains the regulatory asset coverage ratio and the company's compliance with it - Stockholders approved a reduced asset coverage ratio of 150% under the 1940 Act, effective June 22, 2018[269] - As of March 31, 2025, the Company's asset coverage for borrowed amounts was 191%, exceeding the 150% minimum requirement[269] Contractual Obligations This subsection outlines the company's future payment obligations for its outstanding debt Payment Obligations for Debt (March 31, 2025, in thousands) | Liability | Total | Less than 1 year | 1-3 years | 3-5 years | More than 5 years | | :---------------- | :---- | :--------------- | :-------- | :-------- | :---------------- | | Credit Facility | $5,000 | $0 | $5,000 | $0 | $0 | | 2026 Notes | $200,000 | $200,000 | $0 | $0 | $0 | | 2027 Notes | $125,000 | $0 | $125,000 | $0 | $0 | | 2028 Notes | $50,000 | $0 | $50,000 | $0 | $0 | | Total | $380,000 | $200,000 | $180,000 | $0 | $0 | Unfunded Commitments This subsection details the company's commitments to provide future funding to portfolio companies - As of March 31, 2025, unfunded commitments totaled $116.8 million to 15 portfolio companies, with $19.1 million dependent on milestones[271][273][274] - This is an increase from $104.5 million to 14 companies as of December 31, 2024[271][273][274] Commitment Expirations (March 31, 2025, in thousands) | Expiration Year | Amount | | :-------------- | :----- | | 2025 | $43,260 | | 2026 | $51,082 | | 2027 | $22,500 | - The Company generally expects 50%-75% of unfunded commitments to be drawn before expiration[275] - The fair value of the unfunded commitment liability was $1.0 million as of March 31, 2025[276] Distributions This subsection outlines the company's distribution policies, including RIC requirements and excise tax implications - To maintain RIC status, the Company must distribute at least 90% of its net ordinary income and net realized short-term capital gains (net of long-term capital losses)[279] - The Company may be subject to a 4% U.S. federal excise tax if it does not meet specific distribution requirements, as it was for tax years 2024 and 2023[279] - For Q1 2025, a $0.30 per share distribution was declared and paid, with 71.6% from interest-sourced distributions[281][284][285] - Estimated undistributed taxable earnings from net investment income were $42.5 million ($1.06 per share) as of March 31, 2025[281][284][285] Recent Accounting Pronouncements This section discusses recently adopted accounting standards and their impact on the company's financial reporting - The Company adopted ASU 2023-07, "Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures," effective for fiscal years beginning after December 15, 2023[286] - This enhances disclosures about significant segment expenses and clarifies reporting for single-segment entities[286] Recent Developments This section provides updates on significant events occurring after the reporting period - On April 30, 2025, the Board declared a $0.30 per share regular quarterly distribution payable on June 30, 2025[287] - From April 1, 2025, through May 6, 2025, the Company closed $82.0 million of additional debt commitments and funded $50.2 million in new investments[288] - TPC's direct originations platform entered into $92.7 million of additional non-binding signed term sheets[288] Item 3. Quantitative and Qualitative Disclosures About Market Risk This section details the company's exposure to market risks, including interest rate and foreign currency fluctuations Interest Rate Risk This subsection analyzes the company's exposure to changes in interest rates and their potential impact on net investment income - The Company's net investment income is affected by the difference between investment rates and borrowing rates, making it sensitive to interest rate changes[290] - As of March 31, 2025, approximately 62.4% ($368.5 million principal balance) of debt investments bore floating rates (Prime-based) with interest rate floors of 3.25% or higher[293][294] - Floating rate borrowings totaled $5.0 million (1.3% of outstanding debt) with a SOFR floor of 0.50%[293][294] Hypothetical Impact on Net Investment Income (March 31, 2025, in thousands) | Change in Interest Rates | Net increase (decrease) in net investment income | | :----------------------- | :----------------------------------------------- | | Up 300 basis points | $9,860 | | Up 200 basis points | $6,375 | | Up 100 basis points | $2,891 | | Up 50 basis points | $1,302 | | Down 50 basis points | $(1,071) | | Down 100 basis points | $(1,972) | | Down 200 basis points | $(2,959) | | Down 300 basis points | $(3,721) | Foreign Currency Exchange Rate Risk This subsection discusses the company's exposure to fluctuations in foreign currency exchange rates - The Company has exposure to foreign currency exchange rate changes due to $74.8 million of investments at fair value denominated in foreign currencies, which are translated into U.S. dollars at spot rates[296] - No foreign currency hedging transactions were in place as of March 31, 2025[296] Hedging Market Risk This subsection describes the company's strategies and instruments used to mitigate market risks - The Company may utilize instruments like forward contracts to hedge against fluctuations in currency exchange rates or interest rates[297] - Such activities may limit participation in beneficial market movements and are not guaranteed to be effective or risk-free[297] Item 4. Controls and Procedures This section reports on the effectiveness of the company's disclosure controls and internal control over financial reporting Evaluation of Disclosure Controls and Procedures This subsection details the assessment of the company's disclosure controls and procedures by management - The CEO and CFO evaluated the effectiveness of disclosure controls and procedures as of March 31, 2025, and concluded they were effective[299] - Any control system provides only reasonable, not absolute, assurance that objectives are met, and its design is based on assumptions about future events[299] Changes in Internal Control Over Financial Reporting This subsection reports on any material changes to the company's internal control over financial reporting - No changes in internal control over financial reporting occurred during Q1 2025 that materially affected, or are reasonably likely to materially affect, the Company's internal control over financial reporting[300] PART II. OTHER INFORMATION This section provides additional information not covered in the financial statements, including legal, risk, and equity details Item 1. Legal Proceedings This section reports on any material legal proceedings involving the company or its subsidiaries - Neither the Company, its Adviser, nor its subsidiaries are currently subject to any material pending legal proceedings beyond ordinary routine litigation[302] - While outcomes cannot be predicted with certainty, current matters are not expected to materially affect financial condition or results of operations[302] Item 1A. Risk Factors This section advises readers to consider the risks outlined in the report and previous filings - No material changes to the risk factors previously disclosed in the Annual Report on Form 10-K for the year ended December 31, 2024, occurred during the three months ended March 31, 2025[304] Item 2. Unregistered Sales of Equity Securities and Use of Proceeds This section details any unregistered sales of equity securities and the use of proceeds during the reporting period Dividend Reinvestment Plan This subsection describes the company's dividend reinvestment plan and shares issued under it - During Q1 2025, the Company issued 95,458 shares of common stock under its dividend reinvestment plan, which were not subject to Securities Act registration requirements[306] - The cash paid for shares of common stock issued under the dividend reinvestment plan during Q1 2025 was $0.6 million[306] Item 3. Defaults Upon Senior Securities This section confirms whether there were any defaults upon senior securities - None[307] Item 4. Mine Safety Disclosures This section indicates that mine safety disclosures are not applicable to the company - Not applicable[308] Item 5. Other Information This section provides additional information, including details on Rule 10b5-1 trading plans, fees, and stock performance Rule 10b5-1 Trading Plans This subsection reports on any Rule 10b5-1 trading plans adopted or terminated by directors or officers - No directors or officers adopted or terminated any Rule 10b5-1 trading plans or non-Rule 10b5-1 trading arrangements during Q1 2025[309] Fees and Expenses This subsection details the company's annual expenses and hypothetical expenses on an investment Annual Expenses (as a percentage of net assets attributable to common stock, annualized based on Q1 2025) | Expense Type | Percentage | | :---------------------------------------------------------------- | :--------- | | Base management fee payable under the Advisory Agreement | 3.89% | | Incentive fee payable under the Advisory Agreement | 2.51% | | Interest payments on borrowed funds | 7.45% | | Other expenses | 2.36% | | Total annual expenses | 16.21% | Hypothetical Expenses on a $1,000 Investment (assuming 5% annual return) | Period | Expenses | | :------- | :------- | | 1 Year | $137 | | 3 Years | $376 | | 5 Years | $576 | | 10 Years | $941 | Price Range of Common Stock and Distributions This subsection provides information on the trading price of the company's common stock and declared distributions - The Company's common stock is traded on the NYSE under the symbol "TPVG"[319] Common Stock Price and NAV Performance (Q1 2025 vs. Q1 2024) | Period | NAV per Share (end of period) | High Sales Price | Low Sales Price | Declared Distributions | | :---------------- | :---------------------------- | :--------------- | :-------------- | :--------------------- | | First Quarter of 2025 | $8.62 | $8.14 | $6.98 | $0.30 | | First Quarter of 2024 | $9.02 | $11.48 | $9.01 | $0.40 | - Shares of BDCs may trade at a market price that is less than the value of the net assets attributable to those shares[321] - As of May 6, 2025, the reported closing sales price was $6.06 per share[321][322] Item 6. Exhibits This section lists the exhibits filed as part of the report or incorporated by reference - The section provides a list of exhibits, including Articles of Amendment and Restatement, Amended and Restated Bylaws, Note Purchase Agreement, Form of 8.11% Senior Note, CEO and CFO certifications, and Inline XBRL documents[324] Signatures This section contains the required signatures for the report - The report is signed by James P. Labe, Chief Executive Officer and Chairman of the Board of Directors, and Mike L. Wilhelms, Chief Financial Officer, on May 7, 2025[328]