BlackRock TCP Capital Corp. Q1 FY2020 Earnings Call

Ladies and gentlemen, good afternoon. Welcome to BlackRock TCP Capital Corp.'s First Quarter 2020 Earnings Conference Call. This call is being recorded for replay purposes. All participants will be in a listen-only mode during the presentation. A question-and-answer session will follow the company's formal remarks. Now I would like to turn the call over to Katie McGlynn, Director of the BlackRock TCP Capital Corp. Global Investor Relations team. Katie, please proceed.

Thank you, Shannon. Before we begin, I'll note that this conference call may contain forward-looking statements based on the estimates and assumptions of management at the time of such statements, and are not guarantees of future performance. Forward-looking statements involve risks and uncertainties and actual results could differ materially from those projected. Any forward-looking statements made on this call are made as of today and are subject to change without notice. This morning, we issued our earnings release for the third quarter ended March 31, 2020. We also posted a supplemental earnings presentation to our website at tcpcapital.com. To view the slide presentation, which we will refer to on today's call, please click on the Investor Relations link and select Events & Presentations. These documents should be reviewed in conjunction with the Company's Form 10-Q, which was filed with the SEC this morning. I will now turn the call over to our Chairman and CEO, Howard Levkowitz.

Thank you, Katie. First and foremost, we hope that everyone is staying healthy and safe. Thank you for taking the time to participate on our call today. There are several members of the TCPC team on the call with me, including our President and COO, Raj Vig, and our CFO, Paul Davis. I will start with a few comments on how our team is operating in the current environment. I will then provide an update on our portfolio and financial position, as well as comments on our first quarter performance and activity. Paul will then provide a detailed review of our financial results and our capital and liquidity. After Paul's comments, I will provide some closing comments on the current environment and our outlook before opening the call to your questions. The health and safety of our team has been a priority since the start of the pandemic. In early March, BlackRock implemented firm-wide business continuity procedures. And we are pleased to report that our team has been fully operational as we work remotely. BlackRock's robust technology platform has allowed us to work securely from home, without interruption. We have also been leveraging the extensive resources of the BlackRock platform to gain insights on the evolving environment across industries and asset classes. Our team has been lending to middle market companies for over 20 years through multiple market cycles and our underwriting process incorporates downside risk analysis. Our team is aligned by industry and the same team members who underwrite and manage direct lending investments for TCPC also underwrite special situation investments. As a result, all of our team members have experience working through challenging situations and are well prepared to navigate the current situation. It is clear, however, that the nature of the COVID-19 crisis is unique in its broad impact, including significant limitations on economic activity and mobility across the world. Middle market companies serve a vital role in our economy and we have been working closely with our borrowers and other stakeholders to help these companies sustain their businesses throughout the dislocation caused by the pandemic. This work has included additional detailed reviews of our entire portfolio to proactively identify companies that could be materially affected. While our portfolio is generally invested in less cyclical industries and we have limited direct exposure to industries that have been most impacted, we have been actively working with management teams to facilitate information and assistance. We have a strong balance sheet with diversified funding sources and sufficient liquidity and a well-diversified portfolio. We had no new non-accruals during the first quarter. Additionally, given stock price volatility during the first quarter, we opportunistically repurchased one million shares of our stock, resulting in an NAV contribution of $0.09 per share. Turning to slide 5 and an update on our portfolio, at quarter end, our portfolio had a market value of approximately $1.6 billion, 93% of which is in senior secured debt. Our investments are spread across a wide variety of industries. And while the impacts of the global pandemic are likely to be pervasive, we have limited direct exposure to sectors that have been most severely affected by the global downturn. Furthermore, our loans to companies in directly impacted industries are supported by strong collateral protections. For example, our investments categorized as textile, apparel, and luxury goods are primarily brand licensing businesses. And our loans are collateralized by intellectual property and/or inventory. Our airline exposure was limited to 3.3%. And our loans in this industry are collateralized by planes and engines designed to have a higher value retention in a downturn. Additionally, all payments on interest and amortization are current. Our investments in energy, equipment, and services were limited to 1.8% of the portfolio, the majority of which is an investment in a company that provides environmental compliance software to large diversified energy companies. Our diverse portfolio includes 108 companies. Our largest position represented only 4% of the portfolio and taken together, our five largest positions represented 16%. Furthermore, as the chart on the left side of Slide 6 illustrates, our recurring income is not reliant on income from any one portfolio company. In fact, well over half of our individual portfolio companies contribute less than 1% to our recurring income. As of March 31, 92% of our debt investments were floating rate and 66% of these investments were subject to interest rate floors. Additionally, 83% consisted of first lien exposure as demonstrated on Slide 7. Moving to our portfolio performance during the first quarter, the broadly syndicated loan market experienced significant volatility in March, ultimately ending the quarter down 1,100 basis points from the start of the year. And while the private loan market experienced less volatility than traded markets, wider spreads and markdowns in our portfolio led to a 5.5% decline in the fair value of our portfolio and an 11% decrease in net asset value net of share repurchases. Substantially all of our investments are valued every quarter using third-party sources consistent with the process used for over two decades. Turning to our capital and liquidity as of March 31, we had a diverse leverage program with no near-term maturities. 53% of our outstanding liabilities were unsecured, 33% were bank facilities, and 14% were from our SBA facility. Additionally, we had $259 million of remaining capacity on our credit facilities, all of which was available. This liquidity is nearly five times the level of outstanding unfunded commitments to portfolio companies. I would now like to discuss our deployment activity in the first quarter. Gross deployments in the quarter totaled $143 million and included 13 new loans, seven of which were with existing borrowers. Follow-on investments in existing portfolio companies continue to be an important source of opportunities. From a risk management perspective, these are credits we know and understand well. We believe these opportunities reflect the strength of our borrower relationships and the value we delivered to them beyond just capital. We also continue to focus on investments where we co-lead negotiations. In the first quarter, we were either sole lender or part of a small club of lenders on 10 of 13 of our new investments. This allows us to set deal terms with solid creditor protections and take a more active role in helping companies manage through periods of dislocation. Dispositions in the quarter totaled $77 million and include the payoff of our $31 million loan to First Advantage and the sale of our related equity. We initially provided a first lien financing solution to First Advantage in 2001. We subsequently led a second lien financing, leveraging our deal team's industry experience and experience with technology services companies. Over the course of our investment, First Advantage improved its operating platform and cost structure, launched new technology solutions, and meaningfully expanded its client base. The company's improved performance led to its successful sale in the first quarter of this year and our loan was refinanced. The sale of the equity from our warrants resulted in a realized gain of $4.9 million. Other paydowns in the quarter included an $11 million paydown of our loan to Authentic Brands and a $5 million paydown of our loan to Kenneth Cole. New investments during the quarter had a weighted average effective yield of 9.5%. Investments we exited had a weighted average effective yield of 10.1%. The overall effective yield on our debt portfolio was unchanged at 10.3%. As of March 31, 2020, LIBOR had declined 135 basis points since the end of 2018 or 48%. This has put pressure on our portfolio yield and has resulted in an $0.08 per share degradation in recurring investment income over this period. However, we have limited exposure to any further declines in interest rates as the majority of our loans are structured with LIBOR floors as demonstrated on Slide 10 of the presentation. And our portfolio is well positioned for when interest rates rise. As we analyze new investment opportunities, we continue to emphasize seniority, industry diversity, and transactions where we lead or co-lead negotiations on deal terms. Our investment activity in the second quarter-to-date has included incremental financing to existing portfolio companies and a modest amount of draws on unfunded commitments. Turning to the dividend, our Board declared a second quarter dividend of $0.36 per share payable on June 30 to shareholders of record on June 16. We understand the importance of maintaining a consistent dividend that is achievable based on the long-term earnings power of the company. As part of the evaluation of our dividend policy, we are in continuous dialogue with our Board regarding the current environment and the impacts on our portfolio including changes in interest rates, the potential for realized and unrealized gains or losses and loan performance. Now I will turn the call over to Paul who will discuss our financial results in more detail. Paul?

Thanks, Howard and hello, everyone. Starting on Slide 15. Net investment income for the first quarter was $0.38 per share, exceeding our dividend of $0.36 per share. On a cumulative basis, we've outearned our dividends by an aggregate $45 million or $0.78 per share based on total shares outstanding at quarter end. Investment income for the first quarter was $0.70 per share, substantially all of which was interest income. This included recurring cash interest of $0.61, recurring discount and fee amortization of $0.04, and PIK income of $0.04. We had a modest amount of prepayments in the quarter that contributed $0.01 per share, including both prepayment fees and unamortized OID. Investment income in the first quarter also included $0.01 from dividend income. Our income recognition follows our conservative policy of generally amortizing upfront economics over the life of an investment rather than recognizing all of it at the time the investment is made. Operating expenses for the first quarter were $0.33 per share and included interest and other debt expenses of $0.19 per share for net investment income of $0.38 per share. We did not accrue any incentive fees in the first quarter as the reduction in asset valuations reduced our total return below our cumulative hurdle. Our net decrease in net assets for the quarter was $69.5 million or $1.18 per share driven by spread widening and volatility across our portfolio related to the market impact of COVID-19. As we've done consistently, substantially all investments are priced using marks provided by third party sources every quarter, including reputable quotation services and best-in-class independent valuation services. And our process is subject to rigorous oversight including back testing of every disposition against our valuations. Despite the markdowns, our portfolio continued to perform well, and we had no new loans on non-accrual during the quarter. Our loans to two portfolio companies AGY and Avanti remained a non-accrual and together represented 0.2% of the portfolio at fair value and 0.8% at cost. Turning back to slide 8, we had total liquidity of $263 million at quarter end. This included available leverage of $259 million, cash of $9 million, and net pending settlements of $4 million. In contrast, our investments in unfunded credit facilities and delayed draw term loans to portfolio companies totaled just $53 million at quarter end or 3% of total investments. Our seasoned team has managed loan portfolios for two decades including through the downturn of 9/11 and the global financial crisis of 2008, providing us with significant experience managing the fund's capital and liquidity. Drawing from that experience, we have continued to increase the diversity and flexibility of our financing sources over the years, which as of March 31 included two low-cost credit facilities; one convertible note issuance; two straight unsecured note issuances; and an SBA program. Given the modest size of each of these issuances, we are not overly reliant on any single source of financing and our debt issuances are well laddered with no near-term maturities. Our nearest maturity is March of 2022 and represented just 14% of outstanding liabilities. In April, we successfully extended our SVCP credit facility to May 2024, maintaining both the size of the facility and our attractive rate of LIBOR plus 200 basis points. Combined, our outstanding liabilities had a weighted average interest rate of 3.73%, which was down from 3.84% at the end of 2019. We are also pleased to note that both Moody's and Fitch reaffirmed our investment-grade ratings in April. Net regulatory leverage, which is net of SBIC debt cash and outstanding trades, was 1.22 times common equity as of March 31, well within our 2:1 leverage limitation. Given the significant volatility in our share price at the end of the first quarter, we opportunistically repurchased one million shares or 1.7% of shares outstanding at an average purchase price of $6.10, resulting in a NAV contribution of $0.09 per share. I'll now turn the call back over to Howard.

Thanks, Paul. I'll conclude with a few additional comments on the market environment and our outlook before opening the call to questions. These are unprecedented times for everyone. When we mentioned the risks associated with the coronavirus as one of the several potential disruptions on our last quarterly earnings call, I'm not sure anyone fully appreciated the impact the pandemic would have on the global economy. We do not have certainty about what the remainder of 2020 will look like, but the global pandemic is likely to continue to challenge many business models. Given most sectors and companies are being impacted directly or indirectly, our portfolio will not be immune to these challenges. However, our entire team is working every day alongside our borrowers just as we did during prior financial crises to help ensure the long-term health of our portfolio companies while preserving capital for our shareholders. In some cases, this may include providing temporary flexibility in credit terms for certain borrowers. We seek to invest in good companies with strong management teams and these companies collectively employ thousands of individuals and provide necessary goods and services to their customers. We are focused on helping these businesses manage through this period of dislocation and emerge as strong as they were going into the crisis. Before opening up the call to your questions, a comment on our Annual Shareholder Meeting scheduled for May 27. Consistent with prior years and in line with many of our BDC peers, we have included in our proxy a proposal for shareholder approval to issue up to 25% of our common shares on any given date over the next 12 months at a price below net asset value. The purpose of the below NAV issuance proposed on our proxy is to provide flexibility. This is essentially an insurance policy which would provide access to capital markets during periods when access would otherwise be limited. Our shareholders have approved this proposal every year since we went public and our Board has recommended the shareholders do so again this year. In closing, while these are challenging times for everyone, our entire team is focused on ensuring the well-being of our constituents and we remain focused on generating strong risk-adjusted returns for shareholders. And with that, operator, please open the call for questions.

Our first question comes from Finian O'Shea with Wells Fargo. Your line is open.

Hi, good morning everyone. Thanks for having me on and I hope all is well. Forgive me I don't think I've ever got first question on TCP. So I'm a bit blindsided. So I just want to start on the not retail, but textile and apparel book. I think these are cash flow loans correct me if I'm wrong there. Understand, it's the manufacturing of the product and not the retailing. They've still nonetheless held up pretty well obviously a challenging environment for retail. I think the exception is Anne Klein was just marked down to 95%. So I guess first how do these hold up so well in this environment? And second with Anne Klein what's the difference there? How does that one get marked down? Any context you can provide on sort of what happened?

Fin, thanks for joining us today and for your question. Textiles, apparel and luxury goods is a broad category developed by S&P. As I think you know, we use S&P categorizations for our industries. Each one of these companies in here is engaged in selling retail consumer products. They all have a commonality in that they are not just ordinary retail stores; they're secured by assets and/or intellectual property licensing streams. So in the case of Anne Klein, it's a very well-capitalized strongly-backed management team that is the licensor of various international brands that are sold multichannel through stores around the globe. And so as we think about how we've been underwriting the sector, really going back now for about a dozen years we've been involved in retail and consumer for over two decades. But coming out of the last financial crisis, as we saw the evolution and pressure on brick-and-mortar, we focused on hard asset coverage, liquidation values and/or licensing streams for each one of our investments in this sector. And so the fact that it is marked a little bit differently is a function of several things that we use, all third-party marks. We've done this for two decades. They determine the marks every quarter and they do it off of a series of things, spreads, comparables, LIBOR floors, maturity and also a comparable assessment. So there's a series of things that go into the valuation of that instrument that may be distinct from some of the others and including the yield and maturity.

That's very helpful. Thank you. I'll follow up on the third-party marks. You mentioned that you value 100% of your book at third-party marks. This is a general observation and not specifically about TCP. However, we're receiving numerous questions regarding valuations in this space, and there seems to be a challenge due to potential financials. Many companies in various industries are likely to face pressure, and if the valuation doesn't reflect that adequately, is it truly justified for shareholders to pay for full book value every quarter?

Fin, that's a great question. Appreciate it. This is Paul. Our valuation process is rigorous. We look to third-party sources as you noted for every name. The important thing to note about valuations is that valuations are forward-looking. As the markets are pricing in securities, as we look at re-underwriting analysis and places where investments are trading and places where investments are being issued, we're relying on markets to price in their expectations of future performance. And so, we believe that to be very important as we're looking at the prices of assets. I would also note that in addition to using third-party pricing sources for substantially every name, we rigorously test all of our assets on an asset basis on a back-testing basis. of 2008. We've done so historically and found our valuation process to be very accurate and we are very proud of the sources we use.

All right. Thank you for the color. That’s all from me.

Thank you, Fin.

Thank you. Our next question comes from Robert Dodd with Raymond James. Your line is open.

Hi, everyone. I hope you’re all doing well. I have a follow-up question related to Fin first and then a few others. Regarding the underlying asset values, it’s clear that not only textiles and brands are affected but also airlines, with planes and engines involved. As you mentioned in your prepared remarks, we are in an unprecedented situation. The number of planes, for instance, in our sector has significantly increased. How much of that collateral has been revalued in a market where some of those end markets might be saturated with similar assets in the next six to twelve months, especially on the airline side, though perhaps less so for brands? Additionally, has the current environment impacted the over-collateralization levels you believe you have in some of these asset-backed loans?

Yes, Robert, thank you for your question. It's a great one. The airline industry is currently under a lot of scrutiny from those of us who used to fly often, as well as taxpayers who are funding the industry. As we consider its future, I want to highlight our two main investments in this area. The first is OneSky, which is the second-largest provider of private jet services in the country. We have been invested in the company since 2013, and it is well-managed with substantial liquidity. We believe our loans are well over-collateralized. It's worth mentioning that private jet usage is rising as more people are choosing to fly privately, and they have unique payment structures, including fractional owners who contribute towards these planes. So when considering this business, it's quite different from questioning whether large wide-body aircraft will remain in service. Our other significant investment is Mesa, which we have been financing since 2014. They are current on their debt and amortization obligations and have received government funding. They have minimum service obligations with their partners, and we believe we are well-positioned since our planes have lower value and are mostly owned rather than leased, making them more likely to retain them. Despite the considerable changes and challenges facing the industry, we feel confident in our current valuations.

Got it. Got it. Appreciate that color. Thank you. On another one in your final prepared remarks you didn't touch. Did you say there could be temporarily changes to credit terms for some borrowers? I mean, obviously, everybody was current at the end of March. Can you give us any color of what you've seen so far? I mean, obviously, I would expect amendment activity, et cetera, et cetera to be up in Q2 and we're six weeks in. So can you give us any color on what the approaches have been? How the discussions have gone? How sponsors are stepping up? Any color on that front would be appreciated?

Yes, Robert, it's Raj. I'll take that one and others can add as needed. It's a wide range of requests from various sources. There are two main points I want to highlight. First, our operating philosophy prioritizes the protection of our credit and its value, which is our guiding principle. Our main concern is to safeguard our downside and returns, considering our position in the capital structure and what we're entitled to by contract and seniority. In this unprecedented environment, our focus is on the defensibility of the portfolio, both in composition and on an asset-by-asset basis, as well as the ongoing viability and positioning of the businesses. This translates to balance sheet strength, liquidity, and the capability to endure any length of downturn we encounter. When requests come to us, we first assess how they impact our position and whether they help the business strengthen its market stance. This has included additional equity from sponsors, which is particularly valuable now. In certain cases, where we don't perceive an increase in risk, we may grant some relief, whether it’s minor covenant adjustments or tied to asset sales and their proceeds. These requests can range from benign changes that we believe enhance overall enterprise value to instances where we typically wouldn't agree without more commitment from the requesting parties. They are essentially paying for those concessions, and as the downturn progresses and requests evolve or intensify, we always revert to how it affects our capital, which remains our primary focus, and the overall positioning of the business. If it enhances that positioning, we will continue to support it because preserving and enhancing the value of the business is in our best interest as well.

I appreciate that and thank you for your insights. One last question, if I may. Regarding the dividend, congratulations on maintaining it for June. I want to clarify something. Howard, you mentioned that you believe this is achievable long term. To be clear, and acknowledging that this is a board decision and circumstances are changing rapidly, is the dividend you plan to pay in June currently expected to be sustainable long-term based on the board's understanding of the environment and the portfolio's position? Or is it more uncertain beyond June? Is that accurate?

The Board is actively reviewing the current market conditions, our earnings, the state of our portfolio companies, and the interest rate landscape. As mentioned earlier in the call, we have seen a significant decline in LIBOR over the past five quarters, which has reduced the net investment income for TCPC by $0.08 per share on a run rate basis. Historically, we have generated more income than our dividend payout, and in Q1, prepayment fees were also much lower than usual. The Board is examining the sustainability of this situation. While there isn't much more downward movement expected for LIBOR, as illustrated in our slide deck, we do not face significant additional risk from that front. We are also evaluating the appropriate asset allocation in our portfolio given the current volatility and the potential impacts on our companies. Each quarter, we will assess what the suitable dividend level will be moving forward.

All right. Thank you. And that’s it for me. Thanks a lot.

Thank you. Our next question comes from Ryan Lynch with KBW. Your line is open.

Hey, good morning. Thanks for taking my questions and I hope you all are doing well. First one I just wanted to hit on was, obviously, leverage ticked higher for you guys in most BDCs, but because of your diversified liability structure with a lot of unsecured debt, you guys actually have a fair amount of additional liquidity. So, can you just kind of, from a high level talk through how you guys are thinking about allocation of capital in these times? You can obviously retain it, given the uncertainty that we have going on in this environment to retain on your balance sheet and hold it to kind of see what occurs over the next coming months and quarters. You can invest in your existing companies; you guys did some share repurchases, make new investments. Just how are you guys thinking about the liquidity you guys currently hold on your balance sheet today?

Thank you for the question. I hope you're doing well. It's Raj. I'll address that. Overall, in any market, especially the current one, liquidity is a limited resource, and we want to use it wisely. During the initial assessment of the crisis's impact, we focused on ensuring we had liquidity and a thorough understanding of our portfolio in the current environment. We re-evaluated the portfolio, determining where and when we would need additional liquidity to safeguard our assets. Fortunately, how we manage through a crisis is significantly influenced by our prior underwriting approach. Our defensive strategy in terms of capital structure and industry positions us relatively well. This relates to the stability of our dividends for this quarter and our ability to operate with liquidity. We identified the necessary amount to protect our portfolio and found that the health of our assets allows us to pursue new investments. In the current environment, we will be very careful with our capital as we navigate through this downturn, ensuring we don't compromise our liquidity while protecting our existing portfolio and remaining a reliable funding partner in the market, which adds value reflected in premium pricing and structures. We are seeking new opportunities, although I don't anticipate moving at the same pace as in prior quarters due to the current market conditions. We do plan to deploy capital and have already begun doing so in this early part of the quarter. It’s a blend of defense and offense, and thankfully, we are in a position to continue this despite the severity of the crisis we've encountered.

I wanted to ask about the incentive fee. The total return hurdle was reached and removed the incentive fee payment in Q1. Assuming there are no positive or negative fair value marks to your portfolio in the second or third quarters, can you provide an outlook? Do you anticipate earning a full, partial, or no incentive fee in the upcoming quarters based on how the total return hurdle is applied?

Yes. Great question. This is Paul. We did fall below the hurdle in the quarter, but not by a significant margin. Much of this will depend on when and where valuations are set. It's difficult to predict what will happen moving forward, as it relies on valuations. As you mentioned, this is a total return hurdle that looks back cumulatively and reflects the overall performance of the fund. We are pleased that we have managed to exceed it up to this point, and even with the downturn, we are not far below it. However, it's challenging to determine what the future holds, as it really hinges on asset values going forward.

Okay. Fair enough. Those were all my questions. I appreciate the time today.

Thank you, Ryan.

Thank you. Our next question comes from George Bahamondes with Deutsche Bank. Your line is open.

Hi, good morning everyone and thank you for taking my questions. I had a follow-up on the prior question. In your response, you mentioned that you've received requests across the board. Some of them are more benign than others. Can you quantify maybe the percentage of loans that may have asked or requested some formal relief that isn't necessarily benign and maybe a bit more involved? Just we get a sense for maybe some companies that are having more issues than others to date?

Yes, George, thanks for the question. Let me clarify my comment. When I mentioned requests across the board, I didn't mean to suggest that a large percentage of requests were made; I was referring to the nature of the requests themselves. We haven't received a significant number relative to the total companies in the portfolio, and we don't quantify that. I was responding to the types of requests we've seen. None of them have been particularly severe; they've just been varied and tight. Overall, the portfolio remains very healthy, and the companies we work with have good predictability in their businesses, given the industries they're in. I just want to emphasize that it shouldn't be interpreted as a high percentage of requests.

I see. So, great. Thank you for clarifying that. Just no way for us to quantify what amount of borrowers may have asked for some formal relief to date?

I don't think we disclose that. I would say it's a small percentage.

Thank you. Our next question comes from Chris Kotowski with Oppenheimer. Your line is open.

Good morning. Thank you. Most of my questions have been answered, but regarding the incentive fees, could you clarify how much NAV would need to increase for you to be eligible to earn it again?

Good question. This is Paul. Fortunately, not much. We dipped below it here in the first quarter. We can earn that back through a combination of NAV increases and net investment income. It's really not that far, but again we'll see how Q2 goes out and whether it's earned in the second quarter.

Okay. And then on the share repurchases, refresh my memory, you have an outstanding authorization. How much is left on that? And obviously purchases in the sixes were good. And is there a yes, how do you look at that versus maintaining the capital and investing? And how price-sensitive are you there?

Thanks for the question, Chris. Historically, our share repurchases have operated under a $50 million program that automatically executed at certain price levels. Due to the significant market disruption, we were able to pause that program and actively participate in the market during the considerable stock declines in mid and late March. We viewed this as a unique opportunity to enhance shareholder value, a practice we've maintained for many years. The current environment is certainly atypical, so we are carefully considering how to maintain our strong balance sheet and allocate our capital moving forward. The program is still in place, and while we might not have disclosed specifics, we will consider sharing the total amount spent on the program during our next call.

Okay. All right. That's it for me. Thank you.

Thank you.

Thank you. Our next question comes from Christopher Nolan with Ladenburg Thalmann. Your line is open.

Hey. I apologize. I joined the call late, but your aircraft and airline exposure given the difficulties of that market, I mean, what are your thoughts in terms of the trajectory of your credit exposure there?

Chris, thanks for the question. We actually had a detailed question-and-answer on that one. And so it might be more appropriate for others if you'd like to just follow-up with you off-line on what we said to others previously on that, so that we don't repeat what we've said earlier in the call. We addressed our major positions in there. But happy to take any additional questions that you have.

No, that's it for me, Howard. Thank you for taking my question.

Okay. Thank you.

Thank you. And I'm currently showing no further questions at this time. I will turn the call back over to Howard Levkowitz for closing remarks.

Thank you for joining us today. We appreciate your questions and our dialogue. I'd like to thank you for your confidence and your continued support and our experienced and talented team of professionals at BlackRock TCP Capital Corp for your continued hard work and dedication in these challenging times. We hope that everybody is healthy and safe. Thanks again for joining us. This concludes today's call.

Ladies and gentlemen, this concludes today's conference call. Thank you for participating. You may now disconnect.