FS Energy & Power Fund [FSEN] Filings

10-Q 1 fsep-20230630.htm 10-Q fsep-20230630

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

___________________________

FORM 10-Q

___________________________


x			QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

FOR THE QUARTERLY PERIOD ENDED JUNE 30, 2023


¨			TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

COMMISSION FILE NUMBER: 814-00841

___________________________

FS Energy and Power Fund

(Exact name of registrant as specified in its charter)

___________________________


Delaware						27-6822130
(State or other jurisdiction of incorporation or organization)						(I.R.S. Employer Identification No.)

201 Rouse Boulevard Philadelphia, Pennsylvania						19112
(Address of principal executive office)						(Zip Code)

Registrant’s telephone number, including area code: (215) 495-1150

___________________________

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 x No ¨.

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted 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 and post such files). Yes x 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

Accelerated filer

Non-accelerated filer

Smaller reporting company

Emerging growth company

If an emerging growth company, indicate by check mark if the registrant has elected to not 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. ¨

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ¨ No x.

Securities registered pursuant to Section 12(b) Act: None

Title of each class

Trading symbol(s)

Name on each exchange on which registered

N/A

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date. The issuer had 455,504,623 common shares of beneficial interest outstanding as of July 31, 2023.

Table of Contents

TABLE OF CONTENTS


		Page
PART I—FINANCIAL INFORMATION
ITEM 1.	FINANCIAL STATEMENTS
	Consolidated Balance Sheets as of June 30 , 2023 (Unaudited) and December 31, 2022	1
	Unaudited Consolidated Statements of Operations for the three and six months ended June 30 , 2023 and 2022	2
	Unaudited Consolidated Statements of Changes in Net Assets for the three and six months ended June 30 , 2023 and 2022	3
	Unaudited Consolidated Statements of Cash Flows for the six months ended June 30 , 2023 and 2022	4
	Consolidated Schedules of Investments as of June 30 , 2023 (Unaudited) and December 31, 2022	5
	Notes to Unaudited Consolidated Financial Statements	18
ITEM 2.	MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS	38
ITEM 3.	QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK	51
ITEM 4.	CONTROLS AND PROCEDURES	51

PART II—OTHER INFORMATION
ITEM 1.	LEGAL PROCEEDINGS	52
ITEM 1A.	RISK FACTORS	52
ITEM 2.	UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS	53
ITEM 3.	DEFAULTS UPON SENIOR SECURITIES	53
ITEM 4.	MINE SAFETY DISCLOSURES	53
ITEM 5.	OTHER INFORMATION	53
ITEM 6.	EXHIBITS	54
	SIGNATURES	55

Table of Contents

PART I—FINANCIAL INFORMATION

Item 1. Financial Statements.

FS Energy and Power Fund

Consolidated Balance Sheets

(in thousands, except share and per share amounts)


	June 30, 2023 (Unaudited)		December 31, 2022
Assets
Investments, at fair value
Non-controlled/unaffiliated investments (amortized cost—$1,202,527 and $1,656,169, respectively)	$	1,293,701	$	1,786,887
Non-controlled/affiliated investments (amortized cost—$25,483 and $94,068, respectively)	12,720		65,777
Controlled/affiliated investments (amortized cost—$178,328 and $172,703, respectively)	189,181		194,451
Total investments, at fair value (amortized cost—$1,406,338 and $1,922,940, respectively)	1,495,602		2,047,115
Cash	245,358		481,655
Receivable for investments sold and repaid	2,580		7,022
Interest receivable	13,742		21,932
Dividends receivable	359		878
Unrealized appreciation on swap contracts	505		—
Swap income receivable	105		83
Prepaid expenses and other assets	49		96
Total assets	$	1,758,300	$	2,558,781
Liabilities
Payable for investments purchased	$	53,758	$	—
Credit facilities payable (net of deferred financing costs of $0 and $238, respectively)(1)	—		305,438
Secured note payable (net of deferred financing costs of $0 and $1,253, respectively)(1)	—		454,671
Unrealized depreciation on swap contracts	—		698
Swap income payable	—		26
Shareholder distributions payable	13,624		13,543
Management fees payable	8,686		11,185
Administrative services expense payable	663		1,086
Interest payable	—		13,371
Trustees' fees payable	176		164
Other accrued expenses and liabilities	1,670		4,851
Total liabilities	78,577		805,033
Commitments and contingencies(2)
Shareholders' equity
Preferred shares, $0.001 par value, 50,000,000 shares authorized, none issued and outstanding	—		—
Common shares, $0.001 par value, 700,000,000 shares authorized, 454,129,547 and 451,465,673 shares issued and outstanding, respectively	454		451
Capital in excess of par value	3,201,678		3,191,293
Accumulated earnings (deficit)	(1,522,409)		(1,437,996)
Total shareholders' equity	1,679,723		1,753,748
Total liabilities and shareholders' equity	$	1,758,300	$	2,558,781
Net asset value per common share at period end	$	3.70	$	3.88

_________________________

(1) See Note 9 for a discussion of the Company's financing arrangements.

(2) See Note 10 for a discussion of the Company's commitments and contingencies.

See notes to unaudited consolidated financial statements.

Table of Contents

FS Energy and Power Fund

Unaudited Consolidated Statements of Operations

(in thousands, except share and per share amounts)


	Three Months Ended June 30,				Six Months Ended June 30,
	2023		2022		2023		2022
Investment income
From non-controlled/unaffiliated investments:
Interest income	$	21,599	$	23,713	$	51,789	$	46,853
Paid-in-kind interest income	7,245		7,098		11,551		11,521
Fee income	1,029		1,958		1,126		3,191
Dividend income	8,733		—		14,423		—
From non-controlled/affiliated investments:
Interest income	167		1,030		324		2,940
Paid-in-kind interest income	24		22		48		57
Fee income	—		7,268		—		7,268
Dividend income	—		3,691		—		5,417
From controlled/affiliated investments:
Interest income	2,619		2,072		5,078		4,109
Paid-in-kind interest income	60		221		232		891

Dividend income	—		—		—		735
Total investment income	41,476		47,073		84,571		82,982
Operating expenses
Management fees	8,705		11,276		19,179		22,011
Administrative services expenses	1,359		1,490		2,679		2,910
Share transfer agent fees	794		728		1,545		1,448
Accounting and administrative fees	179		189		362		366
Interest expense(1)	5,730		13,196		18,328		26,890
Trustees' fees	176		190		340		417
Other general and administrative expenses	2,651		868		3,354		2,312
Total operating expenses	19,594		27,937

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10-Q	[2020-11-10]
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10-Q	[2019-11-14]
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10-Q	[2019-05-10]
10-K	[2019-03-21]
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10-Q	[2018-08-14]
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10-K	[2018-03-07]
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10-Q	[2017-08-10]
10-Q	[2017-05-12]
10-K	[2017-03-15]
10-Q	[2016-11-10]
10-Q	[2016-08-09]
10-Q	[2016-05-09]
10-K	[2016-03-11]
10-Q	[2015-11-13]
10-Q	[2015-08-14]
10-Q	[2015-05-15]
10-K	[2015-03-13]
10-Q	[2014-11-14]
10-Q	[2014-08-13]
10-Q	[2014-05-14]
10-K	[2014-03-18]
10-Q	[2013-11-14]
10-Q	[2013-08-14]
10-Q	[2013-05-15]
10-K	[2013-03-26]
10-Q	[2012-11-14]
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