UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
Form 10-Q
(Mark One)
þ | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) | ||
OF THE SECURITIES EXCHANGE ACT OF 1934 | |||
For the quarterly period ended March 31, 2019
OR
o | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) | ||
OF THE SECURITIES EXCHANGE ACT OF 1934 | |||
COMMISSION FILE NUMBER: 1-35999
Oaktree Strategic Income Corporation
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
DELAWARE (State or jurisdiction of incorporation or organization) | 61-1713295 (I.R.S. Employer Identification No.) | |
333 South Grand Avenue, 28th Floor Los Angeles, CA (Address of principal executive office) | 90071 (Zip Code) | |
REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE:
(213) 830-6300
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. YES þ NO ¨
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). YES ¨ NO ¨
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of "large accelerated filer," "accelerated filer," "smaller reporting company" and "emerging growth company" in Rule 12b-2 of the Exchange Act.
Large accelerated filer o | Accelerated filer þ | Non-accelerated filer o | Smaller reporting company o | |||
Emerging growth company o | If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act o | |||||
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act) YES ¨ NO þ
SECURITIES REGISTERED PURSUANT TO SECTION 12(b) OF THE ACT:
Title of Each Class | Trading Symbol(s) | Name of Each Exchange on Which Registered | ||
Common Stock, par value $0.01 per share | OCSI | The Nasdaq Global Select Market | ||
The registrant had 29,466,768 shares of common stock outstanding as of May 6, 2019.
OAKTREE STRATEGIC INCOME CORPORATION
FORM 10-Q FOR THE QUARTER ENDED MARCH 31, 2019
TABLE OF CONTENTS
Item 3. | |||
Item 4. | |||
Item 5. | |||
PART I — FINANCIAL INFORMATION
Item 1. | Consolidated Financial Statements. |
Oaktree Strategic Income Corporation
Consolidated Statements of Assets and Liabilities
March 31, 2019 (unaudited) | September 30, 2018 | |||||||
ASSETS | ||||||||
Investments at fair value: | ||||||||
Control investments (cost March 31, 2019: $73,237,461; cost September 30, 2018: $73,501,970) | $ | 56,017,403 | $ | 58,512,170 | ||||
Non-control/Non-affiliate investments (cost March 31, 2019: $546,005,001; cost September 30, 2018: $499,423,794) | 536,130,015 | 498,329,658 | ||||||
Total investments at fair value (cost March 31, 2019: $619,242,462; cost September 30, 2018: $572,925,764) | 592,147,418 | 556,841,828 | ||||||
Cash and cash equivalents | 2,854,506 | 10,439,023 | ||||||
Restricted cash | 8,972,775 | 5,992,764 | ||||||
Interest, dividends and fees receivable | 2,935,766 | 3,139,334 | ||||||
Due from portfolio companies | 52,091 | 167,946 | ||||||
Receivables from unsettled transactions | — | 5,143,533 | ||||||
Deferred financing costs | 2,199,665 | 2,469,675 | ||||||
Derivative asset at fair value | 93,702 | 45,807 | ||||||
Other assets | 930,541 | 891,960 | ||||||
Total assets | $ | 610,186,464 | $ | 585,131,870 | ||||
LIABILITIES AND NET ASSETS | ||||||||
Liabilities: | ||||||||
Accounts payable, accrued expenses and other liabilities | $ | 650,869 | $ | 649,781 | ||||
Base management fee and incentive fee payable | 1,368,446 | 1,915,682 | ||||||
Due to affiliate | 1,047,888 | 1,700,952 | ||||||
Interest payable | 2,961,560 | 1,130,735 | ||||||
Payables from unsettled transactions | 9,395,443 | 8,932,500 | ||||||
Credit facilities payable | 307,656,800 | 275,056,800 | ||||||
Total liabilities | 323,081,006 | 289,386,450 | ||||||
Commitments and contingencies (Note 14) | ||||||||
Net assets: | ||||||||
Common stock, $0.01 par value per share, 150,000,000 shares authorized; 29,466,768 shares issued and outstanding as of March 31, 2019 and September 30, 2018 | 294,668 | 294,668 | ||||||
Additional paid-in-capital | 370,751,389 | 370,751,389 | ||||||
Accumulated overdistributed earnings | (83,940,599 | ) | (75,300,637 | ) | ||||
Total net assets (equivalent to $9.74 and $10.04 per common share as of March 31, 2019 and September 30, 2018, respectively) (Note 12) | 287,105,458 | 295,745,420 | ||||||
Total liabilities and net assets | $ | 610,186,464 | $ | 585,131,870 | ||||
See notes to Consolidated Financial Statements.
1
Oaktree Strategic Income Corporation
Consolidated Statements of Operations
(unaudited)
Three months ended March 31, 2019 | Three months ended March 31, 2018 | Six months ended March 31, 2019 | Six months ended March 31, 2018 | |||||||||||||
Interest income: | ||||||||||||||||
Control investments | $ | 1,472,785 | $ | 768,550 | $ | 2,958,208 | $ | 1,967,247 | ||||||||
Non-control/Non-affiliate investments | 10,769,097 | 8,290,028 | 20,420,246 | 17,054,503 | ||||||||||||
Interest on cash and cash equivalents | 52,132 | 62,879 | 119,127 | 133,974 | ||||||||||||
Total interest income | 12,294,014 | 9,121,457 | 23,497,581 | 19,155,724 | ||||||||||||
PIK interest income: | ||||||||||||||||
Control investments | — | 774,562 | — | 1,069,713 | ||||||||||||
Non-control/Non-affiliate investments | 6,004 | 7,493 | 13,749 | 10,756 | ||||||||||||
Total PIK interest income | 6,004 | 782,055 | 13,749 | 1,080,469 | ||||||||||||
Fee income: | ||||||||||||||||
Non-control/Non-affiliate investments | 181,806 | 651,259 | 229,441 | 1,049,308 | ||||||||||||
Total fee income | 181,806 | 651,259 | 229,441 | 1,049,308 | ||||||||||||
Total investment income | 12,481,824 | 10,554,771 | 23,740,771 | 21,285,501 | ||||||||||||
Expenses: | ||||||||||||||||
Base management fee | 1,451,393 | 1,393,458 | 2,866,160 | 2,805,630 | ||||||||||||
Part I incentive fee | 1,096,144 | 480,384 | 1,950,522 | 740,106 | ||||||||||||
Professional fees | 375,601 | 745,110 | 834,213 | 1,765,293 | ||||||||||||
Directors fees | 105,278 | 130,000 | 210,278 | 260,000 | ||||||||||||
Interest expense | 3,771,530 | 2,898,165 | 6,994,484 | 5,662,642 | ||||||||||||
Administrator expense | 231,033 | 281,931 | 665,900 | 561,615 | ||||||||||||
General and administrative expenses | 283,338 | 276,568 | 615,564 | 711,778 | ||||||||||||
Total expenses | 7,314,317 | 6,205,616 | 14,137,121 | 12,507,064 | ||||||||||||
Fees waived | (49,253 | ) | (240,192 | ) | (476,647 | ) | (357,685 | ) | ||||||||
Net expenses | 7,265,064 | 5,965,424 | 13,660,474 | 12,149,379 | ||||||||||||
Net investment income | 5,216,760 | 4,589,347 | 10,080,297 | 9,136,122 | ||||||||||||
Unrealized appreciation (depreciation): | ||||||||||||||||
Control investments | 1,684,985 | (59,931 | ) | (2,230,258 | ) | (781,106 | ) | |||||||||
Affiliate investments | — | 134,093 | — | 210,009 | ||||||||||||
Non-control/Non-affiliate investments | 6,989,963 | 3,045,873 | (8,780,850 | ) | 5,433,031 | |||||||||||
Foreign currency forward contract | 122,463 | — | 47,895 | — | ||||||||||||
Net unrealized appreciation (depreciation) | 8,797,411 | 3,120,035 | (10,963,213 | ) | 4,861,934 | |||||||||||
Realized gains (losses): | ||||||||||||||||
Affiliate investments | — | — | — | 28 | ||||||||||||
Non-control/Non-affiliate investments | (77,774 | ) | 973,257 | 1,369,532 | (3,409,477 | ) | ||||||||||
Foreign currency forward contract | (240,970 | ) | — | 8,120 | — | |||||||||||
Net realized gains (losses) | (318,744 | ) | 973,257 | 1,377,652 | (3,409,449 | ) | ||||||||||
Net realized and unrealized gains (losses) | 8,478,667 | 4,093,292 | (9,585,561 | ) | 1,452,485 | |||||||||||
Net increase (decrease) in net assets resulting from operations | $ | 13,695,427 | $ | 8,682,639 | $ | 494,736 | $ | 10,588,607 | ||||||||
Net investment income per common share — basic and diluted | $ | 0.18 | $ | 0.16 | $ | 0.34 | $ | 0.31 | ||||||||
Earnings (loss) per common share — basic and diluted (Note 5) | $ | 0.46 | $ | 0.29 | $ | 0.02 | $ | 0.36 | ||||||||
Weighted average common shares outstanding — basic and diluted | 29,466,768 | 29,466,768 | 29,466,768 | 29,466,768 | ||||||||||||
See notes to Consolidated Financial Statements.
2
Oaktree Strategic Income Corporation
Consolidated Statements of Changes in Net Assets
(unaudited)
Three months ended March 31, 2019 | Three months ended March 31, 2018 | Six months ended March 31, 2019 | Six months ended March 31, 2018 | |||||||||||||
Operations: | ||||||||||||||||
Net investment income | $ | 5,216,760 | $ | 4,589,347 | $ | 10,080,297 | $ | 9,136,122 | ||||||||
Net unrealized appreciation (depreciation) | 8,797,411 | 3,120,035 | (10,963,213 | ) | 4,861,934 | |||||||||||
Net realized gains (losses) | (318,744 | ) | 973,257 | 1,377,652 | (3,409,449 | ) | ||||||||||
Net increase (decrease) in net assets resulting from operations | 13,695,427 | 8,682,639 | 494,736 | 10,588,607 | ||||||||||||
Stockholder transactions: | ||||||||||||||||
Distributions to stockholders | (4,567,349 | ) | (4,125,347 | ) | (9,134,698 | ) | (9,724,033 | ) | ||||||||
Net increase (decrease) in net assets from stockholder transactions | (4,567,349 | ) | (4,125,347 | ) | (9,134,698 | ) | (9,724,033 | ) | ||||||||
Capital share transactions: | ||||||||||||||||
Issuance of common stock under dividend reinvestment plan | 50,543 | 33,764 | 104,654 | 192,931 | ||||||||||||
Repurchases of common stock under dividend reinvestment plan | (50,543 | ) | (33,764 | ) | (104,654 | ) | (192,931 | ) | ||||||||
Net change in net assets from capital share transactions | — | — | — | — | ||||||||||||
Total increase (decrease) in net assets | 9,128,078 | 4,557,292 | (8,639,962 | ) | 864,574 | |||||||||||
Net assets at beginning of period | 277,977,380 | 289,943,716 | 295,745,420 | 293,636,434 | ||||||||||||
Net assets at end of period | $ | 287,105,458 | $ | 294,501,008 | $ | 287,105,458 | $ | 294,501,008 | ||||||||
Net asset value per common share | $ | 9.74 | $ | 9.99 | $ | 9.74 | $ | 9.99 | ||||||||
Common shares outstanding at end of period | 29,466,768 | 29,466,768 | 29,466,768 | 29,466,768 | ||||||||||||
See notes to Consolidated Financial Statements.
3
Oaktree Strategic Income Corporation
Consolidated Statements of Cash Flows
(unaudited)
Six months ended March 31, 2019 | Six months ended March 31, 2018 | |||||||
Operating activities: | ||||||||
Net increase (decrease) in net assets resulting from operations | $ | 494,736 | $ | 10,588,607 | ||||
Adjustments to reconcile net increase (decrease) in net assets resulting from operations to net cash provided by (used in) operating activities: | ||||||||
Net change in unrealized (appreciation) depreciation | 10,963,213 | (4,861,934 | ) | |||||
Net realized (gains) losses | (1,377,652 | ) | 3,409,449 | |||||
PIK interest income | (13,749 | ) | (1,080,469 | ) | ||||
Deferred fee income | — | 55,156 | ||||||
Accretion of original issue discount on investments | (1,197,136 | ) | (1,054,923 | ) | ||||
Amortization of deferred financing costs | 280,010 | 397,286 | ||||||
Purchases of investments and net revolver activity | (155,778,510 | ) | (252,559,340 | ) | ||||
Principal payments received on investments (scheduled payments) | 5,879,998 | 3,622,439 | ||||||
Principal payments received on investments (payoffs) | 61,187,153 | 100,481,363 | ||||||
Proceeds from the sale of investments | 44,983,198 | 169,751,775 | ||||||
Changes in operating assets and liabilities: | ||||||||
(Increase) decrease in interest, dividends and fees receivable | 203,568 | 332,083 | ||||||
(Increase) decrease in due from portfolio companies | 115,855 | 248,714 | ||||||
(Increase) decrease in receivables from unsettled transactions | 5,143,533 | (1,515,000 | ) | |||||
(Increase) decrease in other assets | (38,581 | ) | (860,456 | ) | ||||
Increase (decrease) in accounts payable, accrued expenses and other liabilities | 1,088 | 671,553 | ||||||
Increase (decrease) in base management fee and incentive fee payable | (547,236 | ) | (720,253 | ) | ||||
Increase (decrease) in due to affiliate | (653,064 | ) | 1,481,755 | |||||
Increase (decrease) in interest payable | 1,830,825 | 102,749 | ||||||
Increase (decrease) in payables from unsettled transactions | 462,943 | (26,054,256 | ) | |||||
Increase (decrease) in director fees payable | — | 31,992 | ||||||
Net cash provided by (used in) operating activities | (28,059,808 | ) | 2,468,290 | |||||
Financing activities: | ||||||||
Distributions paid in cash | (9,030,044 | ) | (9,531,102 | ) | ||||
Borrowings under credit facilities | 92,000,000 | 29,500,000 | ||||||
Repayments of borrowings under credit facilities | (59,400,000 | ) | (32,400,000 | ) | ||||
Proceeds from issuance of notes payable | — | 3,000,000 | ||||||
Repayments of notes payable | — | (3,000,000 | ) | |||||
Repurchases of common stock under dividend reinvestment plan | (104,654 | ) | (192,931 | ) | ||||
Deferred financing costs paid | (10,000 | ) | (1,250,000 | ) | ||||
Net cash provided by (used in) financing activities | 23,455,302 | (13,874,033 | ) | |||||
Net increase (decrease) in cash and cash equivalents and restricted cash | (4,604,506 | ) | (11,405,743 | ) | ||||
Cash and cash equivalents and restricted cash, beginning of period | 16,431,787 | 43,012,387 | ||||||
Cash and cash equivalents and restricted cash, end of period | $ | 11,827,281 | $ | 31,606,644 | ||||
Supplemental information: | ||||||||
Cash paid for interest | $ | 4,883,649 | $ | 5,162,607 | ||||
Non-cash financing activities: | ||||||||
Issuance of shares of common stock under dividend reinvestment plan | $ | 104,654 | $ | 192,931 | ||||
Reconciliation to the Consolidated Statements of Assets and Liabilities | March 31, 2019 | September 30, 2018 | ||||||
Cash and cash equivalents | $ | 2,854,506 | $ | 10,439,023 | ||||
Restricted cash | 8,972,775 | 5,992,764 | ||||||
Total cash and cash equivalents and restricted cash | $ | 11,827,281 | $ | 16,431,787 | ||||
See notes to Consolidated Financial Statements.
4
Oaktree Strategic Income Corporation
Consolidated Schedule of Investments
March 31, 2019
(unaudited)
Portfolio Company/Type of Investment (1)(2)(3)(4)(5) | Cash Interest Rate (6) | Industry | Principal (7) | Cost | Fair Value | |||||||||||
Control Investments (8) | ||||||||||||||||
OCSI Glick JV LLC (10)(11) | Multi-sector holdings | |||||||||||||||
Subordinated Note, LIBOR+6.50% cash due 10/20/2021 (6)(9) | 9.01% | $ | 66,125,709 | $ | 66,125,710 | $ | 56,017,403 | |||||||||
87.5% equity interest (9)(12) | 7,111,751 | — | ||||||||||||||
73,237,461 | 56,017,403 | |||||||||||||||
Total Control Investments (19.5% of net assets) | $ | 73,237,461 | $ | 56,017,403 | ||||||||||||
Non-Control/Non-Affiliate Investments (13) | ||||||||||||||||
4 Over International, LLC | Commercial printing | |||||||||||||||
First Lien Term Loan, LIBOR+6.00% cash due 6/7/2022 (6)(15)(17) | 8.50% | $ | 5,671,648 | $ | 5,604,126 | $ | 5,604,723 | |||||||||
First Lien Revolver, LIBOR+6.00% cash due 6/7/2021 (6)(14)(15)(17) | — | (502 | ) | (808 | ) | |||||||||||
5,603,624 | 5,603,915 | |||||||||||||||
99 Cents Only Stores LLC | General merchandise stores | |||||||||||||||
First Lien Term Loan, LIBOR+5.00% cash 1.50% PIK due 1/13/2022 (6)(17) | 7.65% | 1,622,774 | 1,527,751 | 1,357,045 | ||||||||||||
1,527,751 | 1,357,045 | |||||||||||||||
Access CIG, LLC | Diversified support services | |||||||||||||||
First Lien Term Loan, LIBOR+3.75% cash due 2/27/2025 (6) | 6.24% | 5,490,067 | 5,440,342 | 5,435,166 | ||||||||||||
5,440,342 | 5,435,166 | |||||||||||||||
AI Ladder (Luxembourg) Subco S.a.r.l. | Electrical components & equipment | |||||||||||||||
First Lien Term Loan, LIBOR+4.50% cash due 7/9/2025 (6)(9) | 7.10% | 6,582,316 | 6,404,136 | 6,479,502 | ||||||||||||
6,404,136 | 6,479,502 | |||||||||||||||
Air Medical Group Holdings, Inc. | Healthcare services | |||||||||||||||
First Lien Term Loan, LIBOR+4.25% cash due 3/14/2025 (6)(17) | 6.74% | 2,501,335 | 2,445,540 | 2,357,508 | ||||||||||||
2,445,540 | 2,357,508 | |||||||||||||||
Airxcel, Inc. | Household appliances | |||||||||||||||
First Lien Term Loan, LIBOR+4.50% cash due 4/28/2025 (6) | 7.00% | 6,947,500 | 6,886,971 | 6,449,607 | ||||||||||||
6,886,971 | 6,449,607 | |||||||||||||||
AL Midcoast Holdings LLC | Oil & gas storage & transportation | |||||||||||||||
First Lien Term Loan, LIBOR+5.50% cash due 8/1/2025 (6) | 8.10% | 567,150 | 561,479 | 565,967 | ||||||||||||
561,479 | 565,967 | |||||||||||||||
All Web Leads, Inc. | Advertising | |||||||||||||||
First Lien Term Loan, LIBOR+7.00% cash due 12/29/2020 (6)(15)(17) | 9.63% | 24,451,287 | 24,451,261 | 21,646,700 | ||||||||||||
24,451,261 | 21,646,700 | |||||||||||||||
Allen Media, LLC | Movies & entertainment | |||||||||||||||
First Lien Term Loan, LIBOR+6.50% cash due 8/30/2023 (6)(15)(17) | 9.08% | 4,937,500 | 4,827,383 | 4,795,547 | ||||||||||||
4,827,383 | 4,795,547 | |||||||||||||||
Ancile Solutions, Inc. | Application software | |||||||||||||||
First Lien Term Loan, LIBOR+7.00% cash due 6/30/2021 (6)(15)(17) | 9.60% | 8,920,819 | 8,780,739 | 8,845,438 | ||||||||||||
8,780,739 | 8,845,438 | |||||||||||||||
Apptio, Inc. | Application software | |||||||||||||||
First Lien Term Loan, LIBOR+7.25% cash due 1/10/2025 (6)(15)(17) | 9.74% | 8,307,692 | 8,147,678 | 8,146,523 | ||||||||||||
First Lien Revolver, LIBOR+7.25% cash due 1/10/2025 (6)(14)(15)(17) | — | (13,335 | ) | (13,430 | ) | |||||||||||
8,134,343 | 8,133,093 | |||||||||||||||
Aptos, Inc. | Computer & electronics retail | |||||||||||||||
First Lien Term Loan, LIBOR+5.50% cash due 7/23/2025 (6)(15) | 8.00% | 10,972,500 | 10,862,775 | 10,903,922 | ||||||||||||
10,862,775 | 10,903,922 | |||||||||||||||
Avantor Inc. | Healthcare distributors | |||||||||||||||
First Lien Term Loan, LIBOR+3.75% cash due 11/21/2024 (6)(17) | 6.25% | 12,737,102 | 12,733,746 | 12,772,894 | ||||||||||||
12,733,746 | 12,772,894 | |||||||||||||||
Avaya, Inc. | Communications equipment | |||||||||||||||
First Lien Term Loan, LIBOR+4.25% cash due 12/15/2024 (6)(17) | 6.73% | 9,875,000 | 9,781,959 | 9,849,276 | ||||||||||||
9,781,959 | 9,849,276 | |||||||||||||||
5
Oaktree Strategic Income Corporation
Consolidated Schedule of Investments
March 31, 2019
(unaudited)
Portfolio Company/Type of Investment (1)(2)(3)(4)(5) | Cash Interest Rate (6) | Industry | Principal (7) | Cost | Fair Value | |||||||||||
Ball Metalpack Finco, LLC | Metal & glass containers | |||||||||||||||
First Lien Term Loan, LIBOR+4.50% cash due 7/31/2025 (6)(15) | 7.00% | $ | 8,932,500 | $ | 8,891,733 | $ | 8,926,917 | |||||||||
8,891,733 | 8,926,917 | |||||||||||||||
Barracuda Networks, Inc. | Systems software | |||||||||||||||
Second Lien Term Loan, LIBOR+7.25% cash due 2/12/2026 (6)(17) | 9.74% | 6,000,000 | 5,974,161 | 5,955,000 | ||||||||||||
5,974,161 | 5,955,000 | |||||||||||||||
Blackhawk Network Holdings, Inc. | Data processing & outsourced services | |||||||||||||||
Second Lien Term Loan, LIBOR+7.00% cash due 6/15/2026 (6)(17) | 9.50% | 4,375,000 | 4,332,632 | 4,353,125 | ||||||||||||
4,332,632 | 4,353,125 | |||||||||||||||
Boxer Parent Company Inc. | Systems software | |||||||||||||||
First Lien Term Loan, LIBOR+4.25% cash due 10/2/2025 (6) | 6.85% | 6,149,588 | 6,080,418 | 6,034,559 | ||||||||||||
6,080,418 | 6,034,559 | |||||||||||||||
Cadence Aerospace LLC | Aerospace & defense | |||||||||||||||
First Lien Term Loan, LIBOR+6.50% cash due 11/14/2023 (6)(15)(17) | 9.10% | 13,582,668 | 13,467,381 | 13,256,018 | ||||||||||||
13,467,381 | 13,256,018 | |||||||||||||||
Canyon Buyer, Inc. | Application software | |||||||||||||||
First Lien Term Loan, LIBOR+4.25% cash due 2/15/2025 (6) | 6.85% | 8,977,330 | 8,870,101 | 8,918,439 | ||||||||||||
8,870,101 | 8,918,439 | |||||||||||||||
Cast & Crew Payroll, LLC | Application software | |||||||||||||||
First Lien Term Loan, LIBOR+4.00% cash due 2/9/2026 (6) | 6.50% | 5,000,000 | 4,950,000 | 5,026,875 | ||||||||||||
4,950,000 | 5,026,875 | |||||||||||||||
Cincinnati Bell Inc. | Integrated telecommunication services | |||||||||||||||
First Lien Term Loan, LIBOR+3.25% cash due 10/2/2024 (6)(9)(17) | 5.75% | 4,918,134 | 4,902,668 | 4,877,731 | ||||||||||||
4,902,668 | 4,877,731 | |||||||||||||||
CircusTrix Holdings LLC | Leisure facilities | |||||||||||||||
First Lien Term Loan, LIBOR+5.50% cash due 12/16/2021 (6)(15)(17) | 8.00% | 8,113,470 | 8,056,179 | 8,044,911 | ||||||||||||
First Lien Delayed Draw Term Loan, LIBOR+5.50% cash due 12/16/2021 (6)(14)(15)(17) | 8.00% | 708,020 | 695,464 | 692,995 | ||||||||||||
8,751,643 | 8,737,906 | |||||||||||||||
CITGO Petroleum Corp. | Oil & gas refining & marketing | |||||||||||||||
First Lien Term Loan, PRIME+2.50% cash due 7/29/2021 (6)(17) | 8.00% | 5,984,375 | 5,964,393 | 5,975,398 | ||||||||||||
First Lien Term Loan, LIBOR+5.00% cash due 3/22/2024 (6)(17) | 7.60% | 6,000,000 | 5,940,000 | 6,000,000 | ||||||||||||
11,904,393 | 11,975,398 | |||||||||||||||
Curvature, Inc. | IT consulting & other services | |||||||||||||||
First Lien Term Loan, LIBOR+5.00% cash due 10/30/2023 (6)(17) | 7.50% | 9,775,000 | 9,729,182 | 7,656,268 | ||||||||||||
9,729,182 | 7,656,268 | |||||||||||||||
DigiCert, Inc. | Internet services & infrastructure | |||||||||||||||
First Lien Term Loan, LIBOR+4.00% cash due 10/31/2024 (6)(17) | 6.50% | 10,685,683 | 10,662,897 | 10,520,963 | ||||||||||||
10,662,897 | 10,520,963 | |||||||||||||||
Empower Payments Acquisition, Inc. | Commercial printing | |||||||||||||||
First Lien Term Loan, LIBOR+4.25% cash due 10/11/2025 (6)(15)(17) | 6.75% | 9,975,000 | 9,951,492 | 9,875,250 | ||||||||||||
9,951,492 | 9,875,250 | |||||||||||||||
EnergySolutions LLC | Environmental & facilities services | |||||||||||||||
First Lien Term Loan, LIBOR+3.75% cash due 5/9/2025 (6)(17) | 6.35% | 3,970,000 | 3,952,545 | 3,520,060 | ||||||||||||
3,952,545 | 3,520,060 | |||||||||||||||
Eton | Research & consulting services | |||||||||||||||
Second Lien Term Loan, LIBOR+7.50% cash due 5/1/2026 (6) | 10.00% | 5,000,000 | 4,977,714 | 4,937,500 | ||||||||||||
4,977,714 | 4,937,500 | |||||||||||||||
Femur Buyer, Inc. | Healthcare equipment | |||||||||||||||
Second Lien Term Loan, LIBOR+4.50% cash due 3/5/2026 (6) | 7.10% | 9,000,000 | 8,910,000 | 9,028,125 | ||||||||||||
8,910,000 | 9,028,125 | |||||||||||||||
6
Oaktree Strategic Income Corporation
Consolidated Schedule of Investments
March 31, 2019
(unaudited)
Portfolio Company/Type of Investment (1)(2)(3)(4)(5) | Cash Interest Rate (6) | Industry | Principal (7) | Cost | Fair Value | |||||||||||
Flight Bidco Inc. | Alternative carriers | |||||||||||||||
First Lien Term Loan, LIBOR+3.50% cash due 7/23/2025 (6) | 6.00% | $ | 7,192,771 | $ | 7,159,863 | $ | 7,105,846 | |||||||||
7,159,863 | 7,105,846 | |||||||||||||||
Frontier Communications Corporation | Integrated telecommunication services | |||||||||||||||
First Lien Term Loan, LIBOR+3.75% cash due 6/15/2024 (6)(9)(17) | 6.25% | 1,496,193 | 1,458,040 | 1,464,399 | ||||||||||||
1,458,040 | 1,464,399 | |||||||||||||||
GKD Index Partners, LLC | Specialized finance | |||||||||||||||
First Lien Term Loan, LIBOR+7.25% cash due 6/29/2023 (6)(15)(17) | 9.85% | 9,018,056 | 8,941,506 | 8,876,022 | ||||||||||||
First Lien Revolver, LIBOR+7.25% cash due 6/29/2023 (6)(14)(15)(17) | — | (3,773 | ) | (7,000 | ) | |||||||||||
8,937,733 | 8,869,022 | |||||||||||||||
GoodRx, Inc. | Interactive media & services | |||||||||||||||
First Lien Term Loan, LIBOR+3.00% cash due 10/10/2025 (6) | 5.49% | 3,990,000 | 3,980,619 | 3,953,432 | ||||||||||||
3,980,619 | 3,953,432 | |||||||||||||||
iCIMs, Inc. | Application software | |||||||||||||||
First Lien Term Loan, LIBOR+6.50% cash due 9/12/2024 (6)(15)(17) | 8.99% | 4,705,882 | 4,620,395 | 4,620,014 | ||||||||||||
First Lien Revolver, LIBOR+6.50% cash due 9/12/2024 (6)(14)(15)(17) | — | (5,343 | ) | (5,367 | ) | |||||||||||
4,615,052 | 4,614,647 | |||||||||||||||
Indivior Finance S.a.r.l. | Pharmaceuticals | |||||||||||||||
First Lien Term Loan, LIBOR+4.50% cash due 12/19/2022 (6)(9)(17) | 7.25% | 8,514,403 | 8,479,221 | 8,365,401 | ||||||||||||
8,479,221 | 8,365,401 | |||||||||||||||
Internet Pipeline, Inc. | Internet services & infrastructure | |||||||||||||||
First Lien Term Loan, LIBOR+4.75% cash due 8/4/2022 (6)(15)(17) | 7.25% | 12,914,839 | 12,904,194 | 12,827,902 | ||||||||||||
First Lien Revolver, LIBOR+4.75% cash due 8/4/2021 (6)(14)(15)(17) | — | — | (5,384 | ) | ||||||||||||
12,904,194 | 12,822,518 | |||||||||||||||
Jo-Ann Stores LLC | Specialty stores | |||||||||||||||
First Lien Term Loan, LIBOR+5.00% cash due 10/20/2023 (6)(17) | 7.76% | 3,807,575 | 3,807,575 | 3,798,056 | ||||||||||||
3,807,575 | 3,798,056 | |||||||||||||||
Kellermeyer Bergensons Services, LLC | Environmental & facilities services | |||||||||||||||
Second Lien Term Loan, LIBOR+8.50% cash due 4/29/2022 (6)(15)(17) | 11.25% | 280,000 | 280,000 | 282,450 | ||||||||||||
280,000 | 282,450 | |||||||||||||||
KIK Custom Products Inc. | Household products | |||||||||||||||
First Lien Term Loan, LIBOR+4.00% cash due 5/15/2023 (6)(9)(17) | 6.50% | 5,000,000 | 5,029,318 | 4,683,350 | ||||||||||||
5,029,318 | 4,683,350 | |||||||||||||||
Lannett Company, Inc. | Pharmaceuticals | |||||||||||||||
First Lien Term Loan, LIBOR+5.38% cash due 11/25/2022 (6)(9)(17) | 7.87% | 7,534,058 | 7,549,249 | 7,050,635 | ||||||||||||
7,549,249 | 7,050,635 | |||||||||||||||
Lytx Holdings, LLC | Research & consulting services | |||||||||||||||
500 Class B Units (15) | — | 252,998 | ||||||||||||||
— | 252,998 | |||||||||||||||
McAfee, LLC | Systems software | |||||||||||||||
First Lien Term Loan, LIBOR+3.75% cash due 9/30/2024 (6)(17) | 6.25% | 8,179,795 | 8,118,115 | 8,184,948 | ||||||||||||
8,118,115 | 8,184,948 | |||||||||||||||
McDermott Technology (Americas), Inc. | Oil & gas equipment & services | |||||||||||||||
First Lien Term Loan, LIBOR+5.00% cash due 5/12/2025 (6)(9)(17) | 7.50% | 1,288,493 | 1,265,944 | 1,237,977 | ||||||||||||
1,265,944 | 1,237,977 | |||||||||||||||
MHE Intermediate Holdings, LLC | Diversified support services | |||||||||||||||
First Lien Term Loan, LIBOR+5.00% cash due 3/8/2024 (6)(15)(17) | 7.60% | 11,597,262 | 11,431,573 | 11,365,340 | ||||||||||||
First Lien Revolver, LIBOR+5.00% cash due 3/10/2023 (6)(14)(15)(17) | 7.50% | 1,615,764 | 1,386,817 | 1,510,684 | ||||||||||||
First Lien Delayed Draw Term Loan, LIBOR+5.00% cash due 3/8/2024 (6)(15)(17) | 7.60% | 2,361,476 | 2,388,384 | 2,314,252 | ||||||||||||
15,206,774 | 15,190,276 | |||||||||||||||
7
Oaktree Strategic Income Corporation
Consolidated Schedule of Investments
March 31, 2019
(unaudited)
Portfolio Company/Type of Investment (1)(2)(3)(4)(5) | Cash Interest Rate (6) | Industry | Principal (7) | Cost | Fair Value | |||||||||||
Mindbody, Inc. | Internet services & infrastructure | |||||||||||||||
First Lien Term Loan, LIBOR+7.00% cash due 2/15/2025 (6)(15)(17) | 9.48% | $ | 9,047,619 | $ | 8,870,382 | $ | 8,866,667 | |||||||||
First Lien Revolver, LIBOR+7.00% cash due 2/15/2025 (6)(14)(15)(17) | (18,657 | ) | (19,048 | ) | ||||||||||||
8,851,725 | 8,847,619 | |||||||||||||||
Ministry Brands, LLC | Application software | |||||||||||||||
Second Lien Term Loan, LIBOR+9.25% cash due 6/2/2023 (6)(15)(17) | 11.88% | 1,568,067 | 1,552,983 | 1,567,804 | ||||||||||||
Second Lien Delayed Draw Term Loan, LIBOR+9.25% cash due 6/2/2023 (6)(15)(17) | 11.88% | 431,933 | 427,778 | 431,860 | ||||||||||||
First Lien Revolver, LIBOR+5.00% cash due 12/2/2022 (6)(14)(15)(17) | — | (861 | ) | (214 | ) | |||||||||||
1,979,900 | 1,999,450 | |||||||||||||||
Morphe LLC | Personal products | |||||||||||||||
First Lien Term Loan, LIBOR+6.00% cash due 2/10/2023 (6)(15)(17) | 8.50% | 11,400,000 | 11,310,237 | 11,400,000 | ||||||||||||
11,310,237 | 11,400,000 | |||||||||||||||
New Trident Holdcorp, Inc. | Healthcare services | |||||||||||||||
Second Lien Term Loan, LIBOR+9.50% cash due 7/31/2020 (6)(15)(16)(17) | 1,000,000 | 795,624 | — | |||||||||||||
795,624 | — | |||||||||||||||
OCI Beaumont LLC | Commodity chemicals | |||||||||||||||
First Lien Term Loan, LIBOR+4.00% cash due 3/13/2025 (6)(9) | 6.60% | 4,950,000 | 4,944,694 | 4,950,000 | ||||||||||||
4,944,694 | 4,950,000 | |||||||||||||||
Onvoy, LLC | Integrated telecommunication services | |||||||||||||||
First Lien Term Loan, LIBOR+4.50% cash due 2/10/2024 (6)(17) | 7.10% | 3,880,404 | 3,866,845 | 3,486,310 | ||||||||||||
3,866,845 | 3,486,310 | |||||||||||||||
Peraton Corp. | Aerospace & defense | |||||||||||||||
First Lien Term Loan, LIBOR+5.25% cash due 4/29/2024 (6)(17) | 7.75% | 6,386,250 | 6,363,122 | 6,162,731 | ||||||||||||
6,363,122 | 6,162,731 | |||||||||||||||
ProFrac Services, LLC | Industrial machinery | |||||||||||||||
First Lien Term Loan, LIBOR+5.75% cash due 9/15/2023 (6)(15)(17) | 8.36% | 9,672,223 | 9,585,751 | 9,478,777 | ||||||||||||
9,585,751 | 9,478,777 | |||||||||||||||
PSI Services LLC | Human resource & employment services | |||||||||||||||
First Lien Term Loan, LIBOR+5.00% cash due 1/20/2023 (6)(15)(17) | 7.50% | 6,635,430 | 6,570,483 | 6,579,347 | ||||||||||||
6,570,483 | 6,579,347 | |||||||||||||||
R1 RCM Inc. | Healthcare services | |||||||||||||||
First Lien Term Loan, LIBOR+5.25% cash due 5/8/2025 (6)(9)(15) | 7.75% | 3,970,000 | 3,865,606 | 3,950,150 | ||||||||||||
3,865,606 | 3,950,150 | |||||||||||||||
Recorded Books Inc. | Publishing | |||||||||||||||
First Lien Term Loan, LIBOR+4.50% cash due 8/29/2025 (6) | 7.00% | 10,447,500 | 10,343,025 | 10,460,559 | ||||||||||||
10,343,025 | 10,460,559 | |||||||||||||||
Salient CRGT, Inc. | Aerospace & defense | |||||||||||||||
First Lien Term Loan, LIBOR+5.75% cash due 2/28/2022 (6)(15)(17) | 8.25% | 5,813,244 | 5,745,685 | 5,740,579 | ||||||||||||
5,745,685 | 5,740,579 | |||||||||||||||
Signify Health, LLC | Healthcare services | |||||||||||||||
First Lien Term Loan, LIBOR+4.50% cash due 12/23/2024 (6)(17) | 7.10% | 10,890,000 | 10,798,799 | 10,890,000 | ||||||||||||
10,798,799 | 10,890,000 | |||||||||||||||
Sirva Worldwide, Inc. | Diversified support services | |||||||||||||||
First Lien Term Loan, LIBOR+5.50% cash due 8/4/2025 (6) | 8.10% | 7,950,000 | 7,830,750 | 7,771,125 | ||||||||||||
7,830,750 | 7,771,125 | |||||||||||||||
Sophia, L.P. | Systems software | |||||||||||||||
First Lien Term Loan, LIBOR+3.25% cash due 9/30/2022 (6)(17) | 5.85% | 1,406,618 | 1,403,581 | 1,399,880 | ||||||||||||
1,403,581 | 1,399,880 | |||||||||||||||
8
Oaktree Strategic Income Corporation
Consolidated Schedule of Investments
March 31, 2019
(unaudited)
Portfolio Company/Type of Investment (1)(2)(3)(4)(5) | Cash Interest Rate (6) | Industry | Principal (7) | Cost | Fair Value | |||||||||||
StandardAero Aviation Holdings Inc. | Aerospace & defense | |||||||||||||||
First Lien Term Loan, LIBOR+4.00% cash due 1/24/2026 (6) | 6.60% | $ | 2,000,000 | $ | 1,997,500 | $ | 2,003,470 | |||||||||
1,997,500 | 2,003,470 | |||||||||||||||
The Dun & Bradstreet Corporation | Research & consulting services | |||||||||||||||
First Lien Term Loan, LIBOR+5.00% cash due 2/6/2026 (6) | 7.49% | 5,000,000 | 4,901,106 | 4,953,125 | ||||||||||||
4,901,106 | 4,953,125 | |||||||||||||||
TIBCO Software Inc. | Application software | |||||||||||||||
First Lien Term Loan, LIBOR+3.50% cash due 12/4/2020 (6)(17) | 6.00% | 1,994,898 | 1,994,898 | 1,989,910 | ||||||||||||
1,994,898 | 1,989,910 | |||||||||||||||
Tribe Buyer LLC | Human resources & employment services | |||||||||||||||
First Lien Term Loan, LIBOR+4.50% cash due 2/16/2024 (6)(17) | 7.00% | 1,581,878 | 1,578,688 | 1,534,422 | ||||||||||||
1,578,688 | 1,534,422 | |||||||||||||||
Truck Hero, Inc. | Auto parts & equipment | |||||||||||||||
First Lien Term Loan, LIBOR+3.75% cash due 4/22/2024 (6)(17) | ||||||||||||||||