Oaktree Strategic Income Corporation
Oaktree Strategic Income — Q1 2021 Earnings Presentation
28 slides from Oaktree Strategic Income's earnings presentation, Feb 17, 2021
Slide 1: Investor Presentation First Quarter 2021
Investor Presentation First Quarter 2021 Nasdaq: OCSI Filed by Oaktree Strategic Income Corporation pursuant to Rule 425 under the Securities Act of 1933 and deemed filed under Rule 14a-6(b) of the Securities Exchange Act of 1934 Subject Company: Oaktree Strategic Income Corporation File No. of Rela
Slide 2: Forward Looking Statements & Legal Disclosures
Forward Looking Statements & Legal Disclosures Some of the statements in this presentation constitute forward-looking statements because they relate to future events or our future performance or financial condition. The forward-looking statements contained in this presentation may include statements
Slide 3: Forward Looking Statements & Legal Disclosures (continued)
Forward Looking Statements & Legal Disclosures (continued) Calculation of Assets Under Management References to total "assets under management" or "AUM" represent assets managed by Oaktree and a proportionate amount of the AUM reported by DoubleLine Capital LP ("DoubleLine Capital"), in which Oaktre
Slide 4: Managed by Oaktree: A Leading Global Alternative Asset Manager
Managed by Oaktree: A Leading Global Alternative Asset Manager ($ in billions) Investment Areas (by AUM)3 Founded in 1995, Oaktree is a leading global investment management firm focused on credit investing Assets under management of $148 billion1 in contrarian, value-oriented, risk-controlled invest
Slide 5: The Oaktree Advantage
Trusted partner to financial sponsors and management teams based on long-term commitment and focus on lending across economic cycles Strong market presence and established relationships with many sources of investment opportunities – private equity sponsors, capital raising advisers and borrowers Th
Slide 6: Experienced Management Team
Experienced Management Team Mel Carlisle, Chief Financial Officer & Treasurer Managing Director, Head of Oaktree’s Distressed Debt and Strategic Credit Fund Accounting Groups 24-year career with Oaktree Prior experience includes public accounting at PwC and fund accounting at TCW Group, Inc. Kim Lar
Slide 7: Oaktree's Investment Philosophy
Oaktree’s Investment Philosophy Emphasis on fundamental credit analysis, consistency and downside protection are key tenets of Oaktree’s investment philosophy, all of which are strongly aligned with the interests of Oaktree Strategic Income shareholders Primacy of Risk Control Control primarily for
Slide 8: Oaktree's Approach to Direct Lending
Oaktree’s Approach to Direct Lending Focus on proprietary investment opportunities as well as partnering with other lenders as appropriate Leverage the networks and relationships of Oaktree’s over 250 investment professionals Dedicated sourcing professionals are in continuous contact with private eq
Slide 9: Ability to Address a Wide Range of Borrower Needs
Ability to Address a Wide Range of Borrower Needs Extensive, Global Credit Platform to Source Deal Flow Oaktree’s Extensive Origination Capabilities Strong market presence and established relationships with financial sponsors, management teams, capital raising advisors and individual issuers Emphasi
Slide 10: Oaktree's Credit Investment Process
Oaktree’s Credit Investment Process Source Leverage Oaktree’s global platform: Team of 250+ highly- experienced investment professionals Strong market presence and established relationships with financial sponsors, management teams and capital raising advisers Screen Using Investment Criteria Viabil
Slide 11: Corporate Highlights
Corporate Highlights Lend to middle-market companies in both the broadly syndicated and private placement markets Leverage the extensive firm-wide resources and expertise of Oaktree for originations, due diligence and credit selection Provide first lien, floating-rate loans to companies with resilie
Slide 12: Summary of Results for the Quarter Ended December 31, 2020
Summary of Results for the Quarter Ended December 31, 2020 Net Investment Income $0.14 per share for the quarter ended December 31, 2020, up 7% as compared with $0.13 per share for the quarter ended September 30, 2020 Increase primarily driven by lower interest expense resulting from lower outstandi
Slide 13: Update on Pending Merger with OCSL
Update on Pending Merger with OCSL OCSL – OCSI Merger Agreement Summary On October 28, 2020, the Company entered into an agreement to merge with and into OCSL, an affiliated business development company managed by Oaktree, with OCSL as the surviving company Under the terms of the proposed merger, th
Slide 14: Portfolio Summary
Portfolio Summary as of December 31, 2020 (As % of total portfolio at fair value; $ in millions) (As % of total portfolio at fair value) Portfolio Composition Top Ten Industries4 Portfolio Characteristics Note:Numbers may not sum due to rounding. 1Excludes OCSI’s share of the return on debt investme
Slide 15: Portfolio Diversity
Portfolio Diversity OCSI’s portfolio is diverse across borrowers and industries (As % of total portfolio at fair value) (As % of total portfolio at fair value) Portfolio by Industry1 Diversity by Investment Size Top 10 Investments 23% Next 15 Investments 24% Remaining 52 Investments 43% Glick JV 10%
Slide 16: Investment Activity
Investment Activity New Investment Highlights ($ in millions) Historical Originations and Exits (As % of new investment commitments; $ in millions) New Investment Composition As of December 31, 2020 Note:Numbers rounded to the nearest million or percentage point and may not sum due to rounding. 1 Ne
Slide 17: Non-Core Investment Portfolio Detail
As of December 31, 2020 Note:Numbers may not sum due to rounding. 1Excludes investments in the Glick JV. Non-Core Investment Portfolio Detail Portfolio Repositioning Progress1 (As % of non-core investment portfolio at fair value; $ in millions) Non-core Investments by Type (At fair value; $ in milli
Slide 18: Joint Venture Summary
Joint Venture Summary ($ in millions; at fair value) ($ in millions) Joint Venture with GF Equity Funding (“Glick”) Portfolio Summary Cash Flows & Distributions As of December 31, 2020 1Interest rate on subordinated notes was LIBOR + 6.5% prior to the subordinated notes restructuring, which occurred
Slide 19: Capital Structure & Liquidity Overview
Capital Structure & Liquidity Overview ($ in millions) ($ in millions) ($ in millions) Funding Sources Liquidity Rollforward2 Historical Leverage Utilization2 Committed Principal Outstanding Interest Rate Maturity Deutsche Bank Facility $160 $132 LIBOR+2.65% 3/30/2022 Citibank Revolving Credit Facil
Slide 20: Appendix
AY OAKTREE OCSI | Strategic Income Corporation Appendix
Slide 21: Illustrative OCSL-OCSI Merger Consideration
Illustrative OCSL-OCSI Merger Consideration Merger Consideration Highlights Illustrative Example1 OCSI OCSL Combined Total NAV $276.4 $964.9 $1,241.3 Shares Outstanding 29.5 141.0 181.3 NAV Per Share $9.38 $6.85 $6.85 Total merger consideration will be based on the NAVs of OCSL and OCSI determined w
Slide 22: OCSI & OCSL Comparison
OCSI & OCSL Comparison (At fair value, $ in thousands) Portfolio and Balance Sheet Metrics OCSL OCSI Combined Portfolio: Investments at Fair Value $1,712,324 $520,996 $2,233,321 Top 10 Investments1 (%) 23% 23% 20% Number of Portfolio Companies 115 78 143 First Lien (%) 60% 86% 66% Second Lien (%) 25
Slide 23: Portfolio Highlights
Portfolio Highlights ($ in thousands; at fair value) As of 12/31/2020 9/30/2020 6/30/2020 3/31/2020 12/31/2019 Investments at Fair Value $520,996 $502,293 $506,452 $524,379 $584,454 Number of Portfolio Companies 78 78 76 88 84 Average Portfolio Company Debt Investment Size $6,700 $6,600 $6,700 $6,00
Slide 24: Investment Activity
Investment Activity ($ in thousands) As of 12/31/2020 9/30/2020 6/30/2020 3/31/2020 12/31/2019 New Investment Commitments $55,800 $54,100 $41,600 $93,900 $34,900 New Funded Investment Activity1 $43,000 $51,900 $34,900 $101,300 $37,900 Proceeds from Prepayments, Exits, Other Paydowns and Sales $34,30
Slide 25: Financial Highlights
Financial Highlights ($ and number of shares in thousands, except per share amounts) As of 12/31/2020 9/30/2020 6/30/2020 3/31/2020 12/31/2019 Net Investment Income per Share $0.14 $0.13 $0.11 $0.15 $0.16 Net Realized and Unrealized Gains (Losses) per Share $0.34 $0.57 $1.32 $(2.53) $0.05 Earnings (
Slide 26: Net Asset Value Per Share Bridge
Net Asset Value Per Share Bridge Note:Net asset value per share amounts are based on the shares outstanding at each respective quarter end. Net investment income per share, net unrealized appreciation / (depreciation), and net realized gain / (loss) are based on the weighted average number of shares
Slide 27: Historical Statement of Operations
Historical Statement of Operations ($ in thousands) For the three months ended 12/31/2020 9/30/2020 6/30/2020 3/31/2020 12/31/2019 Interest income $7,688 $7,730 $7,783 $9,666 $11,212 PIK interest income 1,084 939 744 297 4 Fee income 215 277 109 380 388 Dividend income - 6 - - - Total investment inc
Slide 28: Contact: Investor Relations
Contact: Michael Mosticchio, Investor Relations [email protected]
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