8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of

The Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): May 7, 2020

Oaktree Strategic Income Corporation

(Exact name of registrant as specified in its charter)

Delaware	814-01013	61-1713295
(State or other jurisdiction of incorporation)	(Commission File Number)	(IRS Employer Identification No.)
333 South Grand Avenue, 28th Floor Los Angeles, CA		90071
(Address of principal executive offices)		(Zip Code)

Registrant’s telephone number, including area code: (213) 830-6300

Not Applicable

(Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

☐ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

☐ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

☐ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

☐ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

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 Stock Market LLC

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (17 CFR §230.405) or Rule 12b-2 of the Securities Exchange Act of 1934 (17 CFR §240.12b-2).

Emerging Growth Company  ☐

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.  ☐

Item 2.02. Results of Operations and Financial Condition.

On May 7, 2020, Oaktree Strategic Income Corporation (the “Company”) issued a press release announcing its financial results for the fiscal quarter ended March 31, 2020. A copy of the press release is attached hereto as Exhibit 99.1.

On May 7, 2020, the Company will host a conference call to discuss its financial results for the fiscal quarter ended March 31, 2020. In connection therewith, the Company provided an investor presentation on its website at http://www.oaktreestrategicincome.com. A copy of the investor presentation is attached hereto as Exhibit 99.2.

The information disclosed under this Item 2.02, including Exhibits 99.1 and 99.2 hereto, is being “furnished” and is not deemed “filed” by the Company for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities of that Section, nor is it deemed incorporated by reference into any filing under the Securities Act of 1933, as amended, or the Exchange Act, except as shall be expressly set forth by specific reference in such filing.

Item 9.01. Financial Statements and Exhibits.

(d)    Exhibits

99.1	Press release of Oaktree Strategic Income Corporation dated May 7, 2020
99.2	Oaktree Strategic Income Corporation Second Quarter 2020 Earnings Presentation

SIGNATURE

Pursuant to the requirements of the Exchange Act, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

	OAKTREE STRATEGIC INCOME CORPORATION
Date: May 7, 2020	By:	/s/ Mel Carlisle
		Name: Mel Carlisle
		Title: Chief Financial Officer and Treasurer

EX-99.1

Exhibit 99.1

Oaktree Strategic Income Corporation Announces Second Fiscal Quarter 2020 Financial Results

and Declares Distribution of $0.125 Per Share

LOS ANGELES, CA, May 7, 2020—Oaktree Strategic Income Corporation (NASDAQ: OCSI) (“Oaktree Strategic Income” or the “Company”), a specialty finance company, today announced its unaudited financial results for the fiscal quarter ended March 31, 2020.

Financial Highlights for the Quarter Ended March 31, 2020

• Total investment income was $10.3 million ($0.35 per share) for the second fiscal quarter of 2020, down from $11.6 million ($0.39 per share) for the first fiscal quarter of 2020, primarily as a result of lower interest income due to the Company’s debt investment in OCSI Glick JV LLC (“OCSI Glick JV”) being placed on non-accrual status as of March 31, 2020.

• Net investment income was $4.6 million ($0.15 per share) for the second fiscal quarter of 2020, as compared with $4.7 million ($0.16 per share) for the first fiscal quarter of 2020, primarily as a result of lower investment income, mostly offset by lower incentive fees as a result of the investment adviser’s permanent waiver of Part I incentive fees for the quarter.

• Net asset value (“NAV”) per share was $7.17 as of March 31, 2020, down 26% from $9.71 as of December 31, 2019. The decrease in NAV was primarily due to increased market volatility and wider credit spreads resulting from the COVID-19 pandemic. The decline in the fair value of the investment portfolio was primarily unrealized and concentrated in liquid senior secured loans, which experienced sharp price declines in March.

• Originated $93.9 million of new investment commitments and received $83.8 million of proceeds from prepayments, exits, other paydowns and sales during the quarter ended March 31, 2020. Of these new investment commitments, 100% were first lien loans.

• Total debt outstanding was $327.2 million as of March 31, 2020. The total debt to equity ratio was 1.55x, and the net debt to equity ratio was 1.44x, after adjusting for cash and cash equivalents.

• Liquidity as of March 31, 2020 was composed of $21.9 million of unrestricted cash and cash equivalents and $77.8 million of undrawn capacity on its credit facilities (subject to borrowing base and other limitations). Unfunded investment commitments were $19.6 million, or $5.6 million when excluding unfunded commitments to the OCSI Glick JV.

• Investment adviser permanently waived all incentive fees for the quarter ended March 31, 2020.

• A quarterly cash distribution was declared of $0.125 per share, payable on June 30, 2020 to stockholders of record on June 15, 2020.

Armen Panossian, Chief Executive Officer and Chief Investment Officer, said, “OCSI’s results reflect the unprecedented challenges resulting from the COVID-19 pandemic. The broad-based sell-off in the credit markets during March impacted the prices of our liquid debt investments at quarter-end and was the primary contributor to the decline in NAV. Since then, following the unprecedented measures taken by policymakers to stimulate the economy, we have experienced a rebound in the prices of these investments through the end of April. While it is difficult to determine the ultimate impact that COVID-19 will have, we believe the overall credit quality of our mostly first lien portfolio remains strong.”

Matt Pendo, President and Chief Operating Officer, said, “OCSI entered this difficult environment on solid footing with leverage below our long-term target range. However, due to the uncertainty caused by the COVID-19 pandemic, we reduced our cash distribution to $0.125 per share and our investment adviser will permanently waive incentive fees payable in the March quarter. We believe these actions are prudent and will help position OCSI to navigate through these challenging times.”

1

Distribution Declaration

The Board of Directors declared a quarterly distribution of $0.125 per share, payable on June 30, 2020 to stockholders of record on June 15, 2020.

Distributions are paid primarily from distributable (taxable) income. To the extent taxable earnings for a fiscal taxable year fall below the total amount of distributions for that fiscal year, a portion of those distributions may be deemed a return of capital to the Company’s stockholders.

2

Results of Operations

	For the three months ended
	March 31, 2020 (unaudited)			December 31, 2019 (unaudited)		March 31, 2019 (unaudited)
Operating results:
Interest income	$	9,665,605		$	11,211,885	$	12,294,014
PIK interest income		296,894			3,563		6,004
Fee income		380,114			387,665		181,806
Total investment income		10,342,613			11,603,113		12,481,824
Net expenses		5,780,838			6,875,533		7,265,064
Net investment income		4,561,775			4,727,580		5,216,760
Net realized and unrealized gains (losses)		(74,777,439	)		1,406,674		8,478,667
Net increase (decrease) in net assets resulting from operations	$	(70,215,664	)	$	6,134,254	$	13,695,427
Net investment income per common share	$	0.15		$	0.16	$	0.18
Net realized and unrealized gains (losses) per common share	$	(2.53	)	$	0.05	$	0.28
Earnings (loss) per common share — basic and diluted	$	(2.38	)	$	0.21	$	0.46

	As of
	March 31, 2020 (unaudited)		December 31, 2019 (unaudited)		September 30, 2019
Select balance sheet and other data:
Cash and cash equivalents	$	21,931,375	$	9,525,141	$	5,646,899
Investment portfolio at fair value		524,379,311		584,453,747		597,104,447
Total debt outstanding		327,156,800		306,156,800		294,656,800
Net assets		211,233,898		286,016,910		284,450,006
Net asset value per share		7.17		9.71		9.65
Total debt to equity ratio		1.55x		1.07x		1.04x
Net debt to equity ratio		1.44x		1.04x		1.02x

Total investment income for the quarter ended March 31, 2020 was $10.3 million and included $9.7 million of interest income from portfolio investments, $0.3 million of payment-in-kind (“PIK”) interest income and $0.4 million of fee income. Total investment income was $1.3 million lower as compared to the quarter ended December 31, 2019, primarily due to the Company’s debt investment in OCSI Glick JV being placed on non-accrual status as of March 31, 2020.

Net expenses for the quarter totaled $5.8 million, down $1.1 million from the quarter ended December 31, 2019. This was primarily attributable to a $0.9 million decrease in incentive fees as a result of the investment adviser’s permanent waiver of Part I incentive fees for the quarter.

Net realized and unrealized losses on the investment portfolio for the quarter were $74.8 million, and included $66 million of unrealized losses related to liquid investments¹ and $5 million of unrealized losses in private investments on investments still held at March 31, 2020.

¹  Includes Level 2 and Level 3 debt securities that are valued based on broker quotations, as well as the Company’s investment in OCSI Glick JV, as its underlying investment portfolio is primarily composed of liquid debt investments.

3

Portfolio and Investment Activity

	As of
($ in thousands)	March 31, 2020 (unaudited)			December 31, 2019 (unaudited)			March 31, 2019 (unaudited)
Investments at fair value	$	524,379		$	584,454		$	592,147
Number of portfolio companies		88			84			81
Average portfolio company debt size	$	6,000		$	7,100		$	7,400
Asset class:
Senior secured debt		92.8	%		90.7	%		90.5	%
OCSI Glick JV		7.2	%		9.3	%		9.5	%
Non-accrual debt investments:
Non-accrual investments at fair value	$	37.8		$	—		$	—
Non-accrual investments as a percentage of debt investments		7.2	%		—	%		—	%
Number of investments on non-accrual		1			—			1
Interest rate type:
Percentage floating-rate		100.0	%		100.0	%		100.0	%
Yields:
Weighted average yield on debt investments1		6.0	%		7.2	%		8.0	%
Cash component of weighted average yield on debt investments		5.5	%		7.0	%		7.8	%
Weighted average yield on total portfolio investments2		6.0	%		7.2	%		8.0	%
Investment activity:
New investment commitments	$	93,900		$	34,900		$	64,400
New funded investment activity3	$	101,300		$	37,900		$	67,900
Proceeds from prepayments, exits, other paydowns and sales	$	83,800		$	46,000		$	38,900
Net new investments4	$	17,500		$	(8,100	)	$	29,000
Number of new investment commitments in new portfolio companies		18			9			9
Number of new investment commitments in existing portfolio companies		9			2			5
Number of portfolio company exits		14			9			7

¹ Annual stated yield earned plus net annual amortization of original issue discount or premium earned on accruing investments, including the Company’s share of the return on debt investments in the OCSI Glick JV.

² Annual stated yield earned plus net annual amortization of original issue discount or premium earned on accruing investments and dividend income, including the Company’s share of the return on debt investments in the OCSI Glick JV.

³ New funded investment activity includes drawdowns on existing revolver commitments.

⁴  Net new investments consists of new funded investment activity less proceeds from prepayments, exits, other paydowns and sales.

As of March 31, 2020, the fair value of the Company’s investment portfolio was $524.4 million and was composed of investments in 88 companies, including the OCSI Glick JV.

As of March 31, 2020, 92.8% of the Company’s portfolio at fair value consisted of senior secured floating-rate debt investments, including 90.6% of first liens and 2.2% of second liens, and 7.2% consisted of a subordinated note investment in the OCSI Glick JV.

The Company’s investments in the OCSI Glick JV totaled $37.8 million at fair value as of March 31, 2020, down 30% from $54.2 million as of December 31, 2019. The sequential decline in the value of the Company’s investments in the OCSI Glick JV was primarily driven by the OCSI Glick JV’s use of leverage and unrealized price declines in the underlying investment portfolio resulting from the broader market volatility. Excluding the impact of leverage, OCSI Glick JV’s underlying investment portfolio at fair value declined 14% during the quarter ended March 31, 2020.

4

As of March 31, 2020, the OCSI Glick JV had $153.2 million in assets, including senior secured loans to 44 portfolio companies. As of March 31, 2020, OCSI Glick JV had $26.8 million of undrawn capacity (subject to borrowing base and other limitations) on its senior revolving credit facility.

As of March 31, 2020, the Company restructured its subordinated notes in the OCSI Glick JV to realign the vehicle for current market conditions. In connection with restructuring, the Company and its joint venture partner extended the notes’ maturity to October 20, 2028, reduced the spread from 6.50% to 4.50%, and the notes will not pay interest on its previously scheduled April 15, 2020 and July 15, 2020 coupon dates so cash will remain in the entity to support its NAV. Given that the notes will not pay interest for two quarters, the Company has placed them on non-accrual. The Company did not recognize any income from the OCSI Glick JV during the quarter ended March 31, 2020.

During the quarter ended March 31, 2020, with the exception of two portfolio companies that modified their scheduled interest payment to PIK in order to preserve liquidity and the OCSI Glick JV, all of the Company’s portfolio companies made their scheduled interest payments during the quarter ended March 31, 2020.

Liquidity and Capital Resources

As of March 31, 2020, the Company had total principal value of debt outstanding of $327.2 million under its credit facilities. The Company was in compliance with all financial covenants under its credit facilities for the March 31, 2020 reporting period.

As of March 31, 2020, the Company had $21.9 million of unrestricted cash and cash equivalents and $77.8 million of undrawn capacity on its credit facilities (subject to borrowing base and other limitations). Unfunded investment commitments were $19.6 million, or $5.6 million when excluding unfunded investment commitments to the OCSI Glick JV. The Company has analyzed cash and cash equivalents, availability under its credit facilities, the ability to rotate out of certain assets and amounts of unfunded commitments that could be drawn and believe its liquidity and capital resources are sufficient to take advantage of market opportunities in the current economic climate.

As of March 31, 2020, the weighted average interest rate on debt outstanding was 3.8%, down from 4.0% as of December 31, 2019, primarily reflecting decreases to LIBOR.

The Company’s total debt to equity ratio was 1.55x and 1.07x as of March 31, 2020 and December 31, 2019, respectively. The Company’s net debt to equity ratio was 1.44x and 1.04x as of March 31, 2020 and December 31, 2019, respectively.

Effective March 22, 2020, the Company amended its Deutsche Bank Facility to extend the revolving period and maturity date to September 30, 2020 and March 30, 2021, respectively, decrease the size of the facility from $250 million to $200 million and modify the interest rate to three-month LIBOR plus 2.25% through September 30, 2020, following which the interest rate will reset to three-month LIBOR plus 2.40% for the remaining term of the facility.

Recent Developments

As of April 30, 2020, the Company had $28 million of unrestricted cash and cash equivalents and $81 million of undrawn capacity on its credit facilities (subject to borrowing base and other limitations). Unfunded investment commitments were $18 million, or $4 million when excluding unfunded commitments to the OCSI Glick JV.

Conference Call Information

Oaktree Strategic Income will host a conference call to discuss its first fiscal quarter results at 12:30 p.m. Eastern Time / 9:30 a.m. Pacific Time on May 7, 2020. The conference call may be accessed by dialing (877) 507-4376 (U.S. callers) or +1 (412) 317-5239 (non-U.S. callers), participant password “Oaktree Strategic Income.” Alternatively, a live webcast of the conference call can be accessed on Oaktree Strategic Income’s website, www.oaktreestrategicincome.com. During the earnings conference call, Oaktree Strategic Income intends to refer to an investor presentation that will be available on the Investors section of the Oaktree Strategic Income website.

For those individuals unable to listen to the live broadcast of the conference call, a replay will be available on Oaktree Strategic Income’s website, or by dialing (877) 344-7529 (U.S. callers) or +1 (412) 317-0088 (non-U.S. callers), access code 10141938, beginning approximately one hour after the broadcast.

5

About Oaktree Strategic Income Corporation

Oaktree Strategic Income Corporation (NASDAQ:OCSI) is a specialty finance company dedicated to providing customized capital solutions for middle-market companies in both the syndicated and private placement markets. The Company seeks to generate a stable source of current income while minimizing the risk of principal loss and, to a lesser extent, capital appreciation by providing innovative first-lien financing solutions to companies across a wide variety of industries. The Company is regulated as a business development company under the Investment Company Act of 1940, as amended. Oaktree Specialty Lending is externally managed by Oaktree Fund Advisors, LLC, an affiliate of Oaktree Capital Management, L.P. For additional information, please visit Oaktree Strategic Income’s website at www.oaktreestrategicincome.com.

Forward-Looking Statements

Some of the statements in this press release constitute forward-looking statements because they relate to future events or our future performance or financial condition. The forward-looking statements may include statements as to: our future operating results and distribution projections; our business prospects and the prospects of our portfolio companies; and the impact of the investments that we expect to make. In addition, words such as “anticipate,” “believe,” “expect,” “seek,” “plan,” “should,” “estimate,” “project” and “intend” indicate forward-looking statements, although not all forward-looking statements include these words. The forward-looking statements contained in this press release involve risks and uncertainties. Our actual results could differ materially from those implied or expressed in the forward-looking statements for any reason, including the factors set forth in “Risk Factors” and elsewhere in our annual report on Form 10-K and our quarterly reports on Form 10-Q. Other factors that could cause actual results to differ materially include: changes in the economy, financial markets and political environment; risks associated with possible disruption in our operations or the economy generally due to terrorism, natural disasters or the COVID-19 pandemic; future changes in laws or regulations (including the interpretation of these laws and regulations by regulatory authorities) and conditions in our operating areas, particularly with respect to business development companies or regulated investment companies; general considerations associated with the COVID-19 pandemic; and other considerations that may be disclosed from time to time in our publicly disseminated documents and filings.

We have based the forward-looking statements included in this presentation on information available to us on the date of this presentation, and we assume no obligation to update any such forward-looking statements. Although we undertake no obligation to revise or update any forward-looking statements, whether as a result of new information, future events or otherwise, you are advised to consult any additional disclosures that we may make directly to you or through reports that we in the future may file with the Securities and Exchange Commission, including annual reports on Form 10-K, quarterly reports on Form 10-Q and current reports on Form 8-K.

Contacts

Investor Relations:

Oaktree Strategic Income Corporation

Michael Mosticchio

(212) 284-1900

ocsi-ir@oaktreecapital.com

Media Relations:

Financial Profiles, Inc.

Moira Conlon

(310) 478-2700

mediainquiries@oaktreecapital.com

6

Oaktree Strategic Income Corporation

Consolidated Statements of Assets and Liabilities

	March 31, 2020 (unaudited)			December 31, 2019 (unaudited)			September 30, 2019
ASSETS
Investments at fair value:
Control investments (cost March 31, 2020: $73,157,303; cost December 31, 2019: $73,168,024; cost September 30, 2019: $73,189,664)	$	37,833,930		$	54,169,710		$	54,326,418
Non-control/Non-affiliate investments (cost March 31, 2020: $546,774,334; cost December 31, 2019: $538,934,038; cost September 30, 2019: $553,679,070)		486,545,381			530,284,037			542,778,029
Total investments at fair value (cost March 31, 2020: $619,931,637; cost December 31, 2019: $612,102,062; cost September 30, 2019: $626,868,734)		524,379,311			584,453,747			597,104,447
Cash and cash equivalents		21,931,375			9,525,141			5,646,899
Restricted cash		9,321,466			8,469,933			8,404,733
Interest, dividends and fees receivable		1,489,472			3,031,841			3,813,730
Due from portfolio companies		539,587			806,914			350,597
Receivables from unsettled transactions		28,775,575			4,105,042			5,091,671
Deferred financing costs		2,308,557			1,923,373			2,139,299
Derivative asset at fair value		316,967			—			20,876
Other assets		731,202			817,916			761,462
Total assets	$	589,793,512		$	613,133,907		$	623,333,714
LIABILITIES AND NET ASSETS
Liabilities:
Accounts payable, accrued expenses and other liabilities	$	1,569,469		$	932,315		$	901,410
Base management fee and incentive fee payable		1,442,121			1,255,344			1,368,431
Due to affiliate		1,041,237			1,404,411			1,457,007
Interest payable		2,532,742			2,545,744			2,750,587
Payables from unsettled transactions		44,817,245			14,653,671			37,724,473
Derivative liability at fair value		—			168,712			—
Director fees payable		—			—			25,000
Credit facilities payable		327,156,800			306,156,800			294,656,800
Total liabilities		378,559,614			327,116,997			338,883,708
Commitments and contingencies
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, 2020, December 31, 2019 and September 30, 2019		294,668			294,668			294,668
Additional paid-in-capital		369,199,332			369,199,332			369,199,332
Accumulated overdistributed earnings		(158,260,102	)		(83,477,090	)		(85,043,994	)
Total net assets (equivalent to $7.17, $9.71 and $9.65 per common share as of March 31, 2020, December 31, 2019 and September 30, 2019, respectively)		211,233,898			286,016,910			284,450,006
Total liabilities and net assets	$	589,793,512		$	613,133,907		$	623,333,714

7

Oaktree Strategic Income Corporation

Consolidated Statements of Operations

(unaudited)

	Three months ended March 31, 2020			Three months ended December 31, 2019			Three months ended March 31, 2019			Six months ended March 31, 2020			Six months ended March 31, 2019
Interest income:
Control investments	$	—		$	1,436,726		$	1,472,785		$	1,436,726		$	2,958,208
Non-control/Non-affiliate investments		9,638,008			9,744,449			10,769,097			19,382,457			20,420,246
Interest on cash and cash equivalents		27,597			30,710			52,132			58,307			119,127
Total interest income		9,665,605			11,211,885			12,294,014			20,877,490			23,497,581
PIK interest income:
Non-control/Non-affiliate investments		296,894			3,563			6,004			300,457			13,749
Total PIK interest income		296,894			3,563			6,004			300,457			13,749
Fee income:
Non-control/Non-affiliate investments		380,114			387,665			181,806			767,779			229,441
Total fee income		380,114			387,665			181,806			767,779			229,441
Total investment income		10,342,613			11,603,113			12,481,824			21,945,726			23,740,771
Expenses:
Base management fee		1,442,121			1,505,526			1,451,393			2,947,647			2,866,160
Part I incentive fee		271,520			992,138			1,096,144			1,263,658			1,950,522
Professional fees		263,188			373,186			375,601			636,374			834,213
Directors fees		105,000			105,000			105,278			210,000			210,278
Interest expense		3,477,099			3,426,891			3,771,530			6,903,990			6,994,484
Administrator expense		229,039			249,914			231,033			478,953			665,900
General and administrative expenses		264,391			273,479			283,338			537,870			615,564
Total expenses		6,052,358			6,926,134			7,314,317			12,978,492			14,137,121
Fees waived		(271,520	)		(50,601	)		(49,253	)		(322,121	)		(476,647	)
Net expenses		5,780,838			6,875,533			7,265,064			12,656,371			13,660,474
Net investment income		4,561,775			4,727,580			5,216,760			9,289,355			10,080,297
Unrealized appreciation (depreciation):
Control investments		(16,325,059	)		(135,068	)		1,684,985			(16,460,127	)		(2,230,258	)
Non-control/Non-affiliate investments		(51,578,952	)		2,251,040			6,989,963			(49,327,912	)		(8,780,850	)
Foreign currency forward contract		485,679			(189,588	)		122,463			296,091			47,895
Net unrealized appreciation (depreciation)		(67,418,332	)		1,926,384			8,797,411			(65,491,948	)		(10,963,213	)
Realized gains (losses):
Non-control/Non-affiliate investments		(7,334,148	)		(277,225	)		(77,774	)		(7,611,373	)		1,369,532
Foreign currency forward contract		(24,959	)		(242,485	)		(240,970	)		(267,444	)		8,120
Net realized gains (losses)		(7,359,107	)		(519,710	)		(318,744	)		(7,878,817	)		1,377,652
Net realized and unrealized gains (losses)		(74,777,439	)		1,406,674			8,478,667			(73,370,765	)		(9,585,561	)
Net increase (decrease) in net assets resulting from operations	$	(70,215,664	)	$	6,134,254		$	13,695,427		$	(64,081,410	)	$	494,736
Net investment income per common share — basic and diluted	$	0.15		$	0.16		$	0.18		$	0.32		$	0.34
Earnings (loss) per common share — basic and diluted	$	(2.38	)	$	0.21		$	0.46		$	(2.17	)	$	0.02
Weighted average common shares outstanding — basic and diluted		29,466,768			29,466,768			29,466,768			29,466,768			29,466,768

8

EX-99.2

Second Quarter Fiscal Year 2020 Earnings Presentation May 7, 2020 Nasdaq: OCSI Exhibit 99.2

Forward Looking Statements 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 as to: our future operating results and distribution projections; the ability of Oaktree Fund Advisors, LLC (“Oaktree”) to reposition our portfolio and to implement Oaktree’s future plans with respect to our business; the ability of Oaktree to attract and retain highly talented professionals; our business prospects and the prospects of our portfolio companies; the impact of the investments that we expect to make; the ability of our portfolio companies to achieve their objectives; our expected financings and investments and additional leverage we may seek to incur in the future; the adequacy of our cash resources and working capital; the timing of cash flows, if any, from the operations of our portfolio companies; and the cost or potential outcome of any litigation to which we may be a party. In addition, words such as “anticipate,” “believe,” “expect,” “seek,” “plan,” “should,” “estimate,” “project” and “intend” indicate forward-looking statements, although not all forward-looking statements include these words. The forward-looking statements contained in this presentation involve risks and uncertainties. Our actual results could differ materially from those implied or expressed in the forward-looking statements for any reason, including the factors set forth in “Risk Factors” and elsewhere in our annual report on Form 10-K for the fiscal year ended September 30, 2019 and our quarterly report on Form 10-Q for the quarter ended March 31, 2020. Other factors that could cause actual results to differ materially include: changes or potential disruptions in our operations, the economy, financial markets or political environment; risks associated with possible disruption in our operations or the economy generally due to terrorism, natural disasters or the COVID-19 pandemic; future changes in laws or regulations (including the interpretation of these laws and regulations by regulatory authorities) and conditions in our operating areas, particularly with respect to business development companies or regulated investment companies; general considerations associated with the COVID-19 pandemic; and other considerations that may be disclosed from time to time in our publicly disseminated documents and filings. We have based the forward-looking statements included in this presentation on information available to us on the date of this presentation, and we assume no obligation to update any such forward-looking statements. Although we undertake no obligation to revise or update any forward-looking statements, whether as a result of new information, future events or otherwise, you are advised to consult any additional disclosures that we may make directly to you or through reports that we in the future may file with the SEC, including annual reports on Form 10-K, quarterly reports on Form 10-Q and current reports on Form 8-K. Unless otherwise indicated, data provided herein are dated as of March 31, 2020.

Summary of Results for the Quarter Ended March 31, 2020 Net Investment Income $0.15 per share as of March 31, 2020, as compared to $0.16 for the quarter ended December 31, 2019 Dividend Declared a cash distribution of $0.125 per share, payable on June 30, 2020 to stockholders of record as of June 15, 2020 Net Asset Value $7.17 per share as of March 31, 2020, down as compared to $9.71 per share as of December 31, 2019 Decline primarily due to increased market volatility and wider credit spreads resulting from the COVID-19 pandemic Investment Activity $94 million of new investment commitments and received $84 million of proceeds from prepayments, exits, other paydowns and sales $31 million of opportunistic purchases made in secondary market during March following broader market volatility resulting from COVID-19 pandemic Originations were 100% first lien Capital Structure & Liquidity $327 million of total debt outstanding 1.55x total debt to equity; 1.44x net debt Liquidity was $100 million, including $22 million of unrestricted cash and $78 million of undrawn capacity on credit facility1 $6 million of unfunded commitments2 1Credit facility availability subject to borrowing base and other limitations. 2Excludes unfunded commitments to OCSI Glick JV LLC (“Glick JV”), a joint venture that invests primarily in middle market and other corporate debt securities.

Portfolio Summary as of March 31, 2020 (As % of total portfolio at fair value; $ in millions) (As % of total portfolio at fair value) Portfolio Composition Top Ten Industries4,5 Portfolio Characteristics (at fair value) $524 million invested in 88 companies 6.0% weighted average yield on debt investments $166 million median portfolio company EBITDA1 Select industry exposures2 Aerospace & Defense: 5.4% Energy: 5.1% Hotels, Restaurants & Leisure and Entertainment : 3.4% All portfolio companies made their regularly scheduled interest payments during the quarter ended March 31, 2020 with the exception of two that modified interest payments to PIK3 Note:Numbers may not sum due to rounding. 1 Excludes negative EBITDA borrowers and recurring revenue software investments. 2Based on GICS industry classification. 3Excludes OCSI’s investment in the Glick JV, which was restructured during the quarter and placed on non-accrual. 4 Based on GICS sub-industry classification. 5Excludes multi-sector holdings, which is comprised of investments in the Glick JV.

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 24% Next 15 Investments 23% Remaining 62 Investments 45% Glick JV 7% Industry Group % of Portfolio Software 18.0% Commercial Services & Supplies 9.0% Media 5.9% Diversified Telecommunication Services 5.8% IT Services 5.6% Aerospace & Defense 5.4% Oil, Gas & Consumable Fuels 5.1% Personal Products 3.5% Health Care Providers & Services 2.6% Machinery 2.2% Diversified Financial Services 2.2% Health Care Technology 2.2% Remaining 22 Industries 25.2% Glick JV 7.2% As of March 31, 2020 Note:Numbers may not sum due to rounding. 1Based on GICS industry classification.

As of March 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 millions) Non-core Portfolio Composition $34 Non-core Investments: 7% of portfolio Non-core Investments: 58% of portfolio -88% Non-core Investments +116% Core Investments ($ in millions; at fair value) Only four non-core investments remain

Portfolio Originations $94 million of new investment commitments $85 million in 18 new portfolio companies and $9 million in 9 existing portfolio companies Diversified across 20 industries 100% first lien $101 million of new funded investments1 6.6% weighted average yield at cost on new investments 100% of new investments also held by other Oaktree funds $8 million of originations from April 1, 2020 through April 30, 2020 9.0% weighted average yield at cost 100% first lien New Investment Highlights ($ in millions) Historical Originations and Exits (As % of new investment commitments; $ in millions) New Investment Composition Note:Numbers rounded to the nearest million or percentage point and may not sum due to rounding. 1 New funded investments includes drawdowns on existing revolver commitments. 2Investment exits includes proceeds from prepayments, exits, other paydowns and sales. 2 1

Financial Highlights ($ in thousands, except per share amounts) As of 3/31/2020 12/31/2019 9/30/2019 6/30/2019 3/31/2019 Net Investment Income per Share $0.15 $0.16 $0.17 $0.20 $0.18 Net Realized and Unrealized Gains (Losses) per Share $(2.53) $0.05 $(0.07) $(0.08) $0.28 Earnings (Loss) per Share $(2.38) $0.21 $0.10 $0.12 $0.46 Distributions per Share $0.155 $0.155 $0.155 $0.155 $0.155 NAV per Share $7.17 $9.71 $9.65 $9.71 $9.74 Weighted Average Shares Outstanding 29,466,768 29,466,768 29,466,768 29,466,768 29,466,768 Investment Portfolio (at Fair Value) $524,379 $584,454 $597,104 $588,582 $592,147 Cash and Cash Equivalents $21,931 $9,525 $5,647 $4,071 $2,855 Total Assets $589,794 $613,134 $623,334 $613,810 $610,186 Total Debt Outstanding $327,157 $306,157 $294,657 $308,257 $307,657 Net Assets $211,234 $286,017 $284,450 $286,021 $287,105 Total Debt to Equity Ratio 1.55x 1.07x 1.04x 1.08x 1.07x Net Debt to Equity Ratio 1.44x 1.04x 1.02x 1.06x 1.06x Weighted Average Interest Rate on Debt Outstanding 3.8% 4.0% 4.2% 4.5% 4.6%

Portfolio Highlights ($ in thousands) As of 3/31/2020 12/31/2019 9/30/2019 6/30/2019 3/31/2019 Investments at Fair Value $524,379 $584,454 $597,104 $588,582 $592,147 Number of Portfolio Companies 88 84 84 82 81 Average Portfolio Company Debt Investment Size $6,000 $7,100 $7,200 $7,300 $7,400 Asset Class: First Lien 90.6% 88.0% 88.5% 88.4% 85.4% Second Lien 2.2% 2.7% 2.4% 2.1% 5.1% Glick JV 7.2% 9.3% 9.1% 9.5% 9.5% Equity 0.0% 0.0% 0.0% 0.0% 0.0% Interest Rate Type for Debt Investments: % Floating Rate 100% 100% 100% 100% 100% Yields: Weighted Average Yield on Debt Investments1 6.0% 7.2% 7.4% 7.8% 8.0% Cash Component of Weighted Average Yield on Debt Investments 5.5% 7.0% 7.3% 7.6% 7.8% Weighted Average Yield on Total Portfolio Investments2 6.0% 7.2% 7.4% 7.8% 8.0% Note:Numbers may not sum due to rounding. 1Annual stated yield earned plus net annual amortization of original issue discount or premium earned on accruing investments, including our share of the return on the debt investments in the Glick JV. 2Annual stated yield earned plus net annual amortization of original issue discount or premium earned on accruing investments and dividend income, including our share of the return on the debt investments in the Glick JV.

Investment Activity ($ in thousands) As of 3/31/2020 12/31/2019 9/30/2019 6/30/2019 3/31/2019 New Investment Commitments $93,900 $34,900 $50,800 $38,800 $64,400 New Funded Investment Activity1 $101,300 $37,900 $51,100 $41,300 $67,900 Proceeds from Prepayments, Exits, Other Paydowns and Sales $83,800 $46,000 $40,200 $43,000 $38,900 Net New Investments2 $17,500 $(8,100) $10,900 $(1,700) $29,000 New Investment Commitments in New Portfolio Companies 18 9 7 5 9 New Investment Commitments in Existing Portfolio Companies 9 2 1 4 5 Portfolio Company Exits 14 9 5 4 7 Weighted Average Yield at Cost on New Debt Investments 6.6% 6.6% 6.8% 6.9% 7.7% 1New funded investment activity includes drawdowns on existing revolver commitments. 2Net new investments consists of new funded investment activity less proceeds from prepayments, exits, other paydowns and sales.

Historical Statement of Operations ($ in thousands, except per share data) For the three months ended 3/31/2020 12/31/2019 9/30/2019 6/30/2019 3/31/2019 Interest income $9,666 $11,212 $11,976 $13,522 $12,294 PIK interest income 297 4 10 3 6 Fee income 380 388 93 284 182 Total investment income 10,343 11,603 12,078 13,809 12,482 Base management fee 1,442 1,506 1,511 1,498 1,451 Part I incentive fee 272 992 1,049 1,295 1,096 Interest expense 3,477 3,427 3,673 3,860 3,772 Other operating expenses1 862 1,002 901 1,052 995 Total expenses 6,052 6,926 7,134 7,705 7,314 Fees waived (272) (51) (198) 185 (49) Net expenses 5,781 6,876 6,937 7,890 7,265 Net investment income 4,562 4,728 5,142 5,918 5,217 Net unrealized appreciation (depreciation) (67,418) 1,926 (148) (2,594) 8,797 Net realized gains (losses) (7,359) (520) (1,997) 158 (319) Net increase (decrease) in net assets resulting from operations $(70,216) $6,134 $2,996 $3,483 $13,695 1Includes professional fees, directors fees, administrator expenses and general and administrative expenses.

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 outstanding for the period. 1Excludes reclassifications of net unrealized appreciation / (depreciation) to net realized gains / (losses) as a result of investments exited during the quarter. 1 1

Q2 2020 Net Unrealized Depreciation Attribution ($ in millions, except per share amounts) 2Q 2020 Unrealized Depreciation by Asset Type1 March 31, 2020 Unrealized Gains (Losses) Per Share Liquid Debt Investments2 $(50) $(1.69) Private Debt Investments (5) (0.17) Total Debt Portfolio Net Unrealized Appreciation (Depreciation) (55) (1.87) Joint Venture Investments (16) (0.55) Total Net Unrealized Appreciation (Depreciation) $(71) $(2.41) 1 Excludes reclassifications of net unrealized appreciation / (depreciation) to net realized gains / (losses) as a result of investments exited during the quarter. 2Level 2 or Level 3 debt securities that are valued based on broker prices. 66% of the portfolio at fair value (excluding the JV) was composed of liquid debt investments that are valued based on a broker quote2 $50 million (70%) of total net unrealized depreciation was related to liquid debt portfolio following credit market selloff in March 7% of the portfolio at fair value was composed of investment in the Glick JV, which primarily invests in first lien liquid debt investments; $16 million (23%) of total net unrealized depreciation $5 million (7%) of total net unrealized depreciation related to private debt portfolio

Capital Structure Overview ($ in millions) ($ in million) ($ in millions) Funding Sources Liquidity Rollforward2 Historical Leverage Utilization2,4 Committed Principal Outstanding Interest Rate Maturity Deutsche Bank Facility $200 $176 LIBOR+2.25% 3/30/2021 Citibank Revolving Credit Facility 180 129 LIBOR+1.70% / 2.25%1 7/18/2023 East West Bank Facility 25 23 LIBOR+2.85% 1/6/2021 Total $405 $327 As of March 31, 2020 Note:We have analyzed cash and cash equivalents, availability under our credit facilities, the ability to rotate out of certain assets and amounts of unfunded commitments that could be drawn and believe our liquidity and capital resources are sufficient to take advantage of market opportunities in the current economic climate. 1Interest rate spread depends on asset type. 2Credit facility availability subject to borrowing base and other limitations. 3 Excludes unfunded commitments to Glick JV. 4Actual leverage and liquidity as of June 30, 2020 may differ materially. OCSI’s independent registered public accounting firm has not audited, reviewed, compiled or performed any procedures with respect to the liquidity and unfunded commitments data presented herein. Target Leverage Ratio: 1.2x to 1.6x debt-to-equity Multiple capital sources provide us with flexibility to optimize new investment fundings in order to maintain competitive borrowing costs 100% of debt sources are floating rate In compliance with all financial covenants under credit facilities for the March 31, 2020 reporting period Amended and extended Deutsche Bank Facility Extended facility maturity date to March 2021 from June 2020 12/31/2019 3/31/2020 4/30/2020 Credit Facility Committed $455 $405 $405 Credit Facility Drawn 306 327 324 Cash and Cash Equivalents 10 22 28 Total Liquidity $159 $100 $109 Total Unfunded Commitments3 16 6 4 Adjusted Liquidity $143 $94 $105 Cash $10 $22 Net Assets $286 $211 Net Leverage 1.0x 1.4x Total Leverage 1.1x 1.5x

Joint Venture Summary ($ in millions; at fair value) (As % of total portfolio at fair value) Joint Venture with GF Equity Funding (“Glick”) Portfolio Summary Debt Portfolio Top Ten Industries1 As of March 31, 2020 1Based on GICS sub-industry classification. Primarily invests in senior secured loans of middle market companies as well as other corporate debt securities Joint venture structure Equity ownership: 87.5% OCSI and 12.5% Glick Shared voting control: 50% OCSI and 50% Glick Funded by $125 million credit facility: Subordinated notes restructuring During the quarter ended March 31, 2020, restructured subordinated notes in order to realign the joint venture for current market conditions Extended maturity to October 2028 and reduced spread from 6.50% to 4.50% In order to support NAV in the JV, we have elected to retain earnings generated by the investment portfolio by forgoing April 15, 2020 and July 15, 2020 interest payments Since the notes will not pay interest for two quarters, OCSI’s investment in the JV has been placed on non-accrual 3/31/2020 12/31/2019 9/30/2019 6/30/2019 Total Investments $137 $158 $173 $158 First Lien 95% 92% 92% 94% Second Lien & Other 5% 8% 8% 6% Number of Debt Investments 44 42 39 35 Average issuer size $3 $4 $4 $5 Wt. avg. debt portfolio yield 5.6% 6.7% 6.9% 7.5% ($ in millions) Committed Principal Outstanding Interest Rate Maturity Credit Facility $125 $98 LIBOR + 1.95% March 2024

Contact: Michael Mosticchio, Investor Relations ocsi-ir@oaktreecapital.com