BlackRock TCP Capital Corp (NASDAQ:TCPC) Q4 2019 Earnings Conference Call - Final Transcript

Feb 26, 2020 • 01:00 pm ET

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BlackRock TCP Capital Corp (NASDAQ:TCPC) Q4 2019 Earnings Conference Call - Final Transcript

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Q & A
Operator
Operator

Thank you. [Operator Instructions] Our first question comes from the line of Chris Kotowski with Oppenheimer. Your line is open.

Analyst
Chris Kotowski

Yeah. Good afternoon. I just wanted to ask on Securus, is that, you noted the markdown, is that purely secondary market trading driven? Or was there any diminution in their debt service capability during the quarter?

Executive
Howard M. Levkowitz

It was based on trading levels. It's a club deal, it's illiquid and it coincided with some headlines from several politicians on the business model. We have financed the company for seven years. There was a period under prior ownership. We re-upped under the last acquisition, where a similar thing happened and the company wound up in court and in fact prevailed on its practices. But it's come under a number of headlines from a couple of politicians.

The company has made very clear that it is working to satisfy these concerns. And we believe that the company itself is running a critical business in that, it provides connections between prisoners and their families, mostly through public prisons and in contracts with a series of public prisons around the country. And in fact, last time it went through some scrutiny, the counter-parties came out and supported the company.

Analyst
Chris Kotowski

Okay. All right. And on Fidelis, that exit is complete, there is no prospect of any recovery on that -- that chapter is closed. Right?

Executive
Paul L. Davis

That's exactly the words I was going to use. The chapter is closed. We view it as a unfortunate, but very isolated incident. And really, I think Howard covered most of the commentary in his opening remarks. But we just saw that the options had take over the business and fund it further or to make a tough decision and move on, which is what we did, but your characterization is accurate.

Analyst
Chris Kotowski

Okay. And then, I guess just somewhat more big picture, Howard, you sounded a bit more cautionary on the economy for reasons that I can understand. And knowing that the coronavirus and all this is very recent, are any of your portfolio companies as far as you can tell, seeing change in economics? Or is it thus far just still primarily, the stock market is uncertain and their coronavirus headlines and that's -- what we all see.

Executive
Howard M. Levkowitz

Well said, Chris. To date, we are not aware of any portfolio companies that have been impacted. We noted that with caution, because we thought to not say something about it given the market activity, the last couple of weeks would be remiss. And so we did flag it, but we have built a portfolio that is mostly non-cyclical and is highly diverse and has less international exposure, but if you have something that's impacting the world's second largest economy, we thought it was important to note that we could be impacted.

Analyst
Chris Kotowski

Okay. All right, fair enough. That's it from me. Thank you.

Executive
Howard M. Levkowitz

Thank you for your questions.

Operator
Operator

Our next question comes from the line of Robert Dodd with Raymond James. Your line