Crescent Capital BDC(US:CCAP)2021-11-11 19:37Financial Data and Key Metrics Changes - The company reported adjusted net investment income of $0.48 per share for Q3 2021, compared to $0.53 in the prior quarter and $0.43 in Q3 2020 [28] - GAAP earnings for Q3 2021 were $0.59 per share, down from $1.16 in Q2 2021 and $1.36 in Q3 2020 [28] - Net asset value (NAV) per share increased to $21.16, up from $20.98 in the previous quarter and $19.07 a year ago, marking the highest value since inception [12][29] Business Line Data and Key Metrics Changes - The investment portfolio consisted of over $1.1 billion across 132 portfolio companies, with 100% of the debt portfolio in sponsor-backed companies [14][15] - 120 out of 121 debt investment portfolio companies made full scheduled principal and interest payments, with 93% of the debt investments marked above $0.95 on the dollar [16][17] - The weighted average yield on income-producing securities was 7.6%, down from 7.8% in the prior quarter [32] Market Data and Key Metrics Changes - The company experienced a gross deployment of $158.5 million in Q3, with 95% in senior secured first lien or unitranche investments [18] - The total commitments for new deals represented only 14% of the total check size committed across Crescent, indicating the scale of the platform [19] Company Strategy and Development Direction - The company aims to ensure 100% dividend coverage via incentive waivers through 2022, reflecting a commitment to capital efficiency [24] - The acquisition of Alcentra Capital Corp has generated a 28% IRR, with 97% of the cost basis in the acquired assets realized [22] Management's Comments on Operating Environment and Future Outlook - Management maintains a positive outlook for the overall economy, expecting continued demand rebound [36] - The origination pipeline for Q4 is robust, with expectations for strong net deployment, potentially the strongest of the year [21] Other Important Information - The Board declared a quarterly cash dividend of $0.41 per share, along with a series of special cash dividends of $0.05 per share [25][26] - The company has a debt-to-equity ratio of 0.94, providing a significant cushion to regulatory asset coverage [33] Q&A Session Summary Question: Pressure on LIBOR floors and interest rates - Management noted some pressure on LIBOR, particularly in the syndicated markets, with LIBOR floors generally between 75 bps to 100 bps [39] Question: Investment in WhiteHawk vehicle - Management expects deployment to ramp up to GACP-type levels in about 1.5 to 2 years [42] Question: Unsecured debt plans - Management is focused on their debt capital structure and is considering prepaying 2023 notes without penalty in January 2023 [46][47]