On August 7, 2024, BlackRock TCP Capital Corp (TCPC, Financial) released its 8-K filing announcing its financial results for the second quarter ended June 30, 2024. BlackRock TCP Capital Corp is an externally-managed specialty finance company focused on middle-market lending. Its investment objective is to achieve high total returns through current income and capital appreciation, with an emphasis on principal protection.
Performance Overview
BlackRock TCP Capital Corp (TCPC, Financial) reported net investment income of $35.8 million, or $0.42 per share, for the second quarter of 2024. This figure fell short of the analyst estimate of $0.43 per share. However, the company’s revenue of $71.5 million exceeded the estimated $68.95 million.
Despite the earnings miss, the company declared a third-quarter dividend of $0.34 per share, marking 49 consecutive quarters of dividend coverage. The net asset value (NAV) per share decreased to $10.20 from $11.14 at the end of the previous quarter.
Financial Achievements and Challenges
BlackRock TCP Capital Corp (TCPC, Financial) achieved an adjusted net investment income of $32.1 million, or $0.38 per share, excluding the amortization of purchase discount recorded in connection with the merger. The company’s net decrease in net assets from operations was $51.3 million, or $0.60 per share, compared to a net increase of $5.1 million, or $0.08 per share, in the previous quarter.
“In the second quarter, we generated adjusted net investment income of 38 cents per share, resulting in adjusted annualized NII return on average equity of 14%, which is at the high end of historical levels, and strong dividend coverage of 112%. Our NAV declined, reflecting higher non-accruals in the quarter. We are proactively working with our borrowers, their lenders and sponsors to resolve credit issues as quickly as possible while also achieving the best outcomes for our investors. We have made good progress on these efforts and our overall portfolio remains healthy," said Rajneesh Vig, BlackRock TCP Capital Corp. Chairman and CEO.
Key Financial Metrics
| Metric | Q2 2024 | Q1 2024 |
|---|---|---|
| Net Investment Income | $35.8 million | $27.6 million |
| Net Asset Value per Share | $10.20 | $11.14 |
| Total Acquisitions | $129.7 million | Not Provided |
| Total Investment Dispositions | $185.0 million | Not Provided |
Portfolio and Investment Activity
As of June 30, 2024, BlackRock TCP Capital Corp (TCPC, Financial) had a consolidated investment portfolio consisting of debt and equity positions in 158 portfolio companies with a total fair value of approximately $2.0 billion. The portfolio was predominantly composed of senior secured debt (91.1%), with 81.3% being first lien. The weighted average annual effective yield of the debt portfolio was approximately 13.7%.
During the quarter, the company invested approximately $129.7 million, primarily in senior secured loans, and received $185.0 million in proceeds from sales or repayments of investments. Debt investments in ten portfolio companies were on non-accrual status, representing 4.9% of the portfolio at fair value.
Liquidity and Capital Resources
As of June 30, 2024, BlackRock TCP Capital Corp (TCPC, Financial) had available liquidity of approximately $779.8 million, including $194.7 million in cash and cash equivalents. The company’s total debt outstanding was $1.32 billion, with a combined weighted-average interest rate of 5.00%.
BlackRock TCP Capital Corp (TCPC, Financial) continues to leverage its expertise and resources to navigate market challenges and deliver attractive long-term returns to shareholders. For more detailed financial information, please refer to the 8-K filing.
Explore the complete 8-K earnings release (here) from BlackRock TCP Capital Corp for further details.
