UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 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, 2024
(Exact name of registrant as specified in its charter)
| (State or Other Jurisdiction of Incorporation) | (Commission File Number) | (IRS Employer Identification No.) | |||||||||||||||
| (Address of Principal Executive Offices) | (Zip Code) | ||||||||||||||||
(212 ) 813-4900
(Registrant’s Telephone Number, Including Area Code)
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 (see General Instruction A.2. below):
| 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 | ||||||
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
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, 2024
The information disclosed under this Item 2.02, including Exhibits 99.1 and 99.2 hereto, is being furnished and shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934 (the “Exchange Act”), and shall not be deemed incorporated by reference into any filing made under the Securities Act of 1933 (the “Securities Act”) or the Exchange Act, except as expressly set forth by specific reference in such filing.
Item 7.01 – Regulation FD Disclosure.
On May 7, 2024
The information disclosed under this Item 7.01, including Exhibit 99.1 hereto, is being furnished and shall not be deemed “filed” for purposes of Section 18 of the Exchange Act, and shall not be deemed incorporated by reference into any filing made under the Securities Act or the Exchange Act, except as expressly set forth by specific reference in such filing.
Item 9.01 – Financial Statements and Exhibits.
Exhibits 99.1 and 99.2 shall be deemed furnished herewith.
(d)Exhibits:
| Exhibit Number | Description | |||||||
| 99.1 | ||||||||
| 99.2 | ||||||||
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| CARLYLE SECURED LENDING, INC. | ||||||||||||||
| (Registrant) | ||||||||||||||
| Dated: | By: | /s/ Thomas M. Hennigan | ||||||||||||
| Name: Thomas M. Hennigan | ||||||||||||||
| Title: Chief Financial Officer | ||||||||||||||
Exhibit 99.1
For Immediate Release
May 7, 2024
Carlyle Secured Lending, Inc. Announces Financial Results For First Quarter Ended 2024, Declares Second Quarter 2024 Dividends of $0.47 Per Common Share
New York - Carlyle Secured Lending, Inc. (together with its consolidated subsidiaries, “we,” “us,” “our,” “CSL” or the “Company”) (NASDAQ: CGBD) today announced its financial results for its first quarter ended March 31, 2024.
Justin Plouffe, CSL’s Chief Executive Officer said, “Consistent with prior quarters, our portfolio continued to deliver steady income and a stable NAV during the first quarter of 2024. It has always been our goal to drive performance with a consistent approach to direct lending anchored in disciplined credit selection and conservative portfolio management. We remain focused on our core middle market strategy and benefit from the differentiation provided by our access to the OneCarlyle platform, while maintaining our ability to be dynamic in response to the market. Discipline and consistency drove performance in the first quarter, and we expect these tenets to drive performance in future quarters.”
Net investment income for the first quarter of 2024 was $0.54 per common share, and net asset value per common share increased by 0.5% for the first quarter to $17.07 from $16.99 as of December 31, 2023. The total fair value of our investments was $1.8 billion as of March 31, 2024.
Dividends
On May 2, 2024, the Board of Directors declared a base quarterly common dividend of $0.40 per share plus a supplemental common dividend of $0.07 per share. The dividends are payable on July 17, 2024 to common stockholders of record on June 28, 2024.
On March 26, 2024, the Company declared a cash dividend on the Preferred Stock for the period from January 1, 2024 to March 31, 2024 in the amount of $0.438 per Preferred Share to the holder of record on March 29, 2024.
Conference Call
The Company will host a conference call at 11:00 a.m. EST on Wednesday, May 8, 2024 to discuss these quarterly financial results. The conference call will be available via public webcast via a link on Carlyle Secured Lending’s website and will also be available on our website soon after the call’s completion.
Carlyle Secured Lending, Inc.
CSL is an externally managed specialty finance company focused on lending to middle-market companies. CSL is managed by Carlyle Global Credit Investment Management L.L.C., an SEC-registered investment adviser and a wholly owned subsidiary of The Carlyle Group Inc. Since it commenced investment operations in May 2013 through March 31, 2024, CSL has invested approximately $8.3 billion in aggregate principal amount of debt and equity investments prior to any subsequent exits or repayments. CSL’s investment objective is to generate current income and capital appreciation primarily through debt investments in U.S. middle market companies. CSL has elected to be regulated as a business development company under the Investment Company Act of 1940, as amended.
Web: carlylesecuredlending.com
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About Carlyle
Carlyle (“Carlyle,” or the “Adviser”) (NASDAQ: CG) is a global investment firm with deep industry expertise that deploys private capital across three business segments: Global Private Equity, Global Credit and Global Investment Solutions. With $425 billion of assets under management as of March 31, 2024, Carlyle’s purpose is to invest wisely and create value on behalf of its investors, portfolio companies and the communities in which we live and invest. Carlyle employs more than 2,200 employees in 28 offices across four continents. Further information is available at www.carlyle.com. Follow Carlyle on X @OneCarlyle and LinkedIn at The Carlyle Group.
CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS
This press release may contain forward-looking statements that involve substantial risks and uncertainties. You can identify these statements by the use of forward-looking terminology such as “anticipates,” “believes,” “expects,” “intends,” “will,” “should,” “may,” “plans,” “continue,” “believes,” “seeks,” “estimates,” “would,” “could,” “targets,” “projects,” “outlook,” “potential,” “predicts” and variations of these words and similar expressions to identify forward-looking statements, although not all forward-looking statements include these words. You should read statements that contain these words carefully because they discuss our plans, strategies, prospects and expectations concerning our business, operating results, financial condition and other similar matters. We believe that it is important to communicate our future expectations to our investors. There may be events in the future, however, that we are not able to predict accurately or control. You should not place undue reliance on these forward-looking statements, which speak only as of the date on which we make it. Factors or events that could cause our actual results to differ, possibly materially from our expectations, include, but are not limited to, the risks, uncertainties and other factors we identify in the sections entitled “Risk Factors” and “Cautionary Statement Regarding Forward-Looking Statements” in filings we make with the Securities and Exchange Commission, and it is not possible for us to predict or identify all of them. We undertake no obligation to update or revise publicly any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law.
Contacts:
| Investors: | Media: | ||||
| Daniel Hahn | Kristen Greco Ashton | ||||
| +1-212-813-4928 publicinvestor@carlylesecuredlending.com | +1-212-813-4763 kristen.ashton@carlyle.com | ||||
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1 Carlyle Secured Lending, Inc. Quarterly Earnings Presentation March 31, 2024
Disclaimer and Forward-Looking Statement This presentation (the “Presentation”) has been prepared by Carlyle Secured Lending, Inc. (together with its consolidated subsidiaries, “we,” “us,” “our,” “CSL” or the “Company”) (NASDAQ: CGBD) and may only be used for informational purposes only. This Presentation should be viewed in conjunction with the earnings conference call of the Company held on May 8, 2024 and the Company’s Annual Report on Form 10-K for the year ended December 31, 2023. The information contained herein may not be used, reproduced, referenced, quoted, linked by website, or distributed to others, in whole or in part, except as agreed in writing by the Company. This Presentation does not constitute a prospectus and should under no circumstances be understood as an offer to sell or the solicitation of an offer to buy our common stock or any other securities nor will there be any sale of the common stock or any other securities in any state or jurisdiction in which such offer, solicitation or sale would be unlawful prior to the registration or qualification under the securities laws of such state or jurisdiction. This Presentation provides limited information regarding the Company and is not intended to be taken by, and should not be taken by, any individual recipient as investment advice, a recommendation to buy, hold or sell, or an offer to sell or a solicitation of offers to purchase, our common stock or any other securities that may be issued by the Company, or as legal, accounting or tax advice. An investment in securities of the type described herein presents certain risks. This Presentation may contain forward-looking statements that involve substantial risks and uncertainties. You can identify these statements by the use of forward- looking terminology such as “anticipates,” “believes,” “expects,” “intends,” “will,” “should,” “may,” “plans,” “continue,” “believes,” “seeks,” “estimates,” “would,” “could,” “targets,” “projects,” “outlook,” “potential,” “predicts” and variations of these words and similar expressions to identify forward-looking statements, although not all forward-looking statements include these words. You should read statements that contain these words carefully because they discuss our plans, strategies, prospects and expectations concerning our business, operating results, financial condition and other similar matters. We believe that it is important to communicate our future expectations to our investors. There may be events in the future, however, that we are not able to predict accurately or control. You should not place undue reliance on these forward-looking statements, which speak only as of the date on which we make them. Factors or events that could cause our actual results to differ, possibly materially from our expectations, include, but are not limited to, the risks, uncertainties and other factors we identify in the sections entitled “Risk Factors” and “Cautionary Statement Regarding Forward-Looking Statements” in filings we make with the Securities and Exchange Commission (the “SEC”), and it is not possible for us to predict or identify all of them. We undertake no obligation to update or revise publicly any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law. Information throughout the Presentation provided by sources other than the Company (including information relating to portfolio companies) has not been independently verified and, accordingly, the Company makes no representation or warranty in respect of this information. The following slides contain summaries of certain financial and statistical information about the Company. The information contained in this Presentation is summary information that is intended to be considered in the context of our SEC filings and other public announcements that we may make, by press release or otherwise, from time to time. We undertake no duty or obligation to publicly update or revise the information contained in this Presentation. CSL is managed by Carlyle Global Credit Investment Management L.L.C. (the “Investment Adviser”), an SEC-registered investment adviser and a wholly owned subsidiary of The Carlyle Group Inc. (together with its affiliates, “Carlyle”). This Presentation contains information about the Company and certain of its affiliates and includes the Company’s historical performance. You should not view information related to the past performance of the Company as indicative of the Company’s future results, the achievement of which is dependent on many factors, many of which are beyond the control of the Company and the Investment Adviser and cannot be assured. There can be no assurances that future dividends will match or exceed historical rates or will be paid at all. Further, an investment in the Company is discrete from, and does not represent an interest in, any other Carlyle entity. Nothing contained herein shall be relied upon as a promise or representation whether as to the past or future performance of the Company or any other Carlyle entity. 2
• As of 1Q24, total fair value of the portfolio was $1.8 billion across 131 portfolio companies with a weighted average yield of 12.6%(1), consistent with the prior quarter • New investment fundings during the quarter were $94.9 million with a weighted average yield of 12.5%. Total repayments and sales during the quarter were $173.4 million with a weighted average yield of 13.7%, driven primarily by repayments of junior investments and the successful exit of Direct Travel • As of 1Q24. non-accrual investments represented only 0.2% and 0.2% of the total portfolio based on amortized cost and fair value, respectively, down from 3.2% and 2.1%, respectively, in the prior period aided by the successful recapitalization of Dermatology Associates Portfolio & Investment Activity • We paid the 1Q24 base dividend of $0.40 plus a supplemental dividend of $0.08 per share • 1Q24 net investment income was 135% of the $0.40 base dividend declared for 2Q24 • Net financial leverage decreased to 0.95x, at the low end of our target range • Total liquidity at 1Q24 was $334.9 million in cash and undrawn debt capacity Liquidity & Capital Activity Q1 2024 Quarterly Highlights 3 Note: Per share amounts within this presentation apply to common shares of the Company unless otherwise noted. (1) On income producing investments at amortized cost. • Net investment income per share was $0.54 per common share, down $0.02 compared to our record 4Q23 results but still well above average core earnings during 2023 • NAV per share was $17.07, up 0.5% compared to our 4Q23 NAV of $16.99 per share • The change in NAV in 1Q24 was primarily driven by earnings in excess of our dividend for the quarter and unrealized appreciation on our portfolio • We declared a base dividend of $0.40 plus a $0.07 supplemental for 2Q24, equating to an annualized dividend yield of 11.0% on our 1Q24 NAV First Quarter Results
Quarterly Operating Results Detail Please refer to the Company’s Form 10-Q for more information. (1) Inclusive of the preferred stock dividend. (2) Inclusive of deferred financing costs and the effective interest rate swap hedge. (3) Reflects cumulative convertible preferred securities as equity, net of excess cash held at period end, which was $55.9 million as of March 31, 2024. (4) Reflects cumulative convertible preferred securities as debt. These securities are considered "senior securities" for the purposes of calculating asset coverage pursuant to the Investment Company Act. (Dollar amounts in thousands, except per share data) Q1 2023 Q2 2023 Q3 2023 Q4 2023 Q1 2024 SUMMARY INCOME STATEMENT Total investment income $ 58,375 $ 60,065 $ 60,501 $ 62,685 $ 62,007 Total expenses(1) (32,680) (33,765) (34,265) (34,445) (34,433) Net Investment Income(1) $ 25,695 $ 26,300 $ 26,236 $ 28,240 $ 27,574 Net realized and change in unrealized gains (losses) 1,417 (22,462) 2,876 478 815 Net Income (Loss)(1) $ 27,112 $ 3,838 $ 29,112 $ 28,718 $ 28,389 Weighted average shares of common stock outstanding 50,887 50,795 50,795 50,795 50,795 Net Investment Income per Share(1) $ 0.50 $ 0.52 $ 0.52 $ 0.56 $ 0.54 Net Income (Loss) per Share(1) $ 0.53 $ 0.08 $ 0.57 $ 0.57 $ 0.56 SUMMARY BALANCE SHEET Total investments, at fair value $ 1,973,565 $ 1,896,420 $ 1,860,475 $ 1,841,881 $ 1,784,893 Cash, cash equivalents and restricted cash 42,873 54,150 55,218 60,447 69,921 Other assets 38,969 32,027 41,057 40,250 40,257 Total Assets $ 2,055,407 $ 1,982,597 $ 1,956,750 $ 1,942,578 $ 1,895,071 Debt and secured borrowings(2) 1,092,707 1,037,185 1,003,296 980,183 930,182 Accrued expenses and liabilities 44,507 45,731 47,010 49,583 48,069 Preferred stock 50,000 50,000 50,000 50,000 50,000 Total Liabilities and Preferred Stock $ 1,187,214 $ 1,132,916 $ 1,100,306 $ 1,079,766 $ 1,028,251 Net Assets $ 918,193 $ 899,681 $ 906,444 $ 912,812 $ 916,820 Preferred stock (50,000) (50,000) (50,000) (50,000) (50,000) Net Assets less preferred stock $ 868,193 $ 849,681 $ 856,444 $ 862,812 $ 866,820 Common shares outstanding at end of period 50,795 50,795 50,795 50,795 50,795 Net Asset Value available to Common $ 17.09 $ 16.73 $ 16.86 $ 16.99 $ 17.07 LEVERAGE Net Financial Leverage(3) 1.16x 1.11x 1.06x 1.02x 0.95x Statutory Debt to Equity(4) 1.32x 1.28x 1.23x 1.19x 1.13x 4
Please refer to the Company’s Form 10-Q for more information. No assurance is given that the Company will continue to achieve comparable results. (1) Excludes activity related to the Investment Funds. (2) Based on cost/proceeds of equity activity. (3) At quarter end. (4) As a percentage of fair value. (5) Weighted average yields exclude investments on non-accrual status. Weighted average yields of income producing investments include Credit Fund and Credit Fund II, as well as income producing equity investments. Origination Activity Detail (Dollar amounts in thousands and based on par) Q1 2023 Q2 2023 Q3 2023 Q4 2023 Q1 2024 NEW INVESTMENT FUNDINGS BY ASSET TYPE (1) First lien debt $ 53,164 $ 44,511 $ 56,025 $ 75,004 $ 71,581 Second lien debt 325 4,825 613 578 406 Equity(2) 2,361 1,630 2,166 1,349 22,892 Total $ 55,850 $ 50,966 $ 58,804 $ 76,931 $ 94,879 Weighted Average Yield at Amortized Cost 12.7 % 12.4 % 13.4 % 12.8 % 12.5 % SALES & REPAYMENTS BY ASSET TYPE (1) First lien debt $ (68,505) $ (106,038) $ (57,832) $ (35,292) $ (140,103) Second lien debt (6,954) — (28,891) (50,588) (25,146) Equity(2) (829) (1,495) (1,543) (11,034) (8,196) Total $ (76,288) $ (107,533) $ (88,266) $ (96,914) $ (173,445) Weighted Average Yield at Amortized Cost 10.1 % 11.5 % 12.5 % 13.5 % 13.7 % Net Investment Activity $ (20,438) $ (56,567) $ (29,462) $ (19,983) $ (78,566) TOTAL INVESTMENT PORTFOLIO BY ASSET TYPE (3)(4) First lien debt 68.5 % 67.1 % 68.4 % 71.3 % 70.9 % Second lien debt 13.1 % 14.0 % 12.7 % 10.2 % 9.3 % Equity 5.2 % 5.4 % 5.4 % 5.0 % 5.9 % Investment funds 13.2 % 13.5 % 13.5 % 13.5 % 13.9 % Total 100.0 % 100.0 % 100.0 % 100.0 % 100.0 % Weighted Average Yield on Debt Investments at Amortized Cost(5) 12.0 % 12.6 % 12.8 % 12.8 % 12.7 % Weighted Average Yield on Income Producing Investments at Amortized Cost(5) 12.1 % 12.6 % 12.7 % 12.7 % 12.6 % 5
Senior Secured Exposure(3) 95% 71% 9% 6% 14% First Lien Debt Second Lien Debt Equity Investments Investment Funds 10% 8% 7% 7% 6% 5% 5%4% 48% Healthcare & Pharmaceuticals Software Business Services High Tech Industries Aerospace & Defense Diversified Financial Services Consumer Services Leisure Products & Services All Others Portfolio Highlights (1) Weighted average yields exclude investments placed on non-accrual status. Weighted average yields of income producing investments include Credit Fund and Credit Fund II, as well as income producing equity investments. (2) As a percentage of fair value. (3) Represents CSL's exposure to the respective underlying portfolio companies, including CSL's proportionate share of the portfolio companies held in the Investment Funds. (4) Excludes equity positions, loans on non-accrual, unfunded commitments, and certain asset-backed, asset-based, and recurring revenue loans. Total investments at fair value ($mm) $1,785 Weighted Average Yield on Income Producing Investments at Amortized Cost(1) 12.6% Number of investments 174 Number of portfolio companies 131 Average exposure by portfolio company(2) 0.8% Non-accrual investments(2) 0.2% 6 Key Statistics Asset Mix(2) Portfolio Industry Exposure(2)(3) Floating Rate 100% Company EBITDA(4) (Median) $81mm Sponsored 92%
40% 32% 28% Top 10 Investments Next 11-25 Remaining Investments 13% 7% 7% 7% 7% 6%6%5% 42% Business Services Utilities: Electric Beverage & Food Telecommunications Aerospace & Defense Diversified Financial Services Leisure Products & Services Healthcare & Pharmaceuticals All Others Combined Investment Funds Portfolio Overview of Investment Funds (1) Weighted average yields at cost of the debt investments include the effect of accretion of discounts and amortization of premiums and are based on interest rates as of period end. Weighted average yields exclude investments placed on non-accrual status. Actual yields earned over the life of each investment could differ materially from the yields presented above. 7 Key Statistics - Credit Fund II Diversification by Borrower Diversification by Industry CSL Investment at cost ($mm) $78 CSL ownership 84.1 % Yield of debt investments at cost (1) 11.9 % Leverage 1.9x Effective cost of debt SOFR + 2.88% Annualized dividend yield to CSL 14.2 % Key Statistics - Credit Fund CSL Investment at cost ($mm) $193 CSL ownership 50.0 % Yield of debt investments at cost (1) 11.2 % Leverage 1.3x Effective cost of debt SOFR +2.70% Annualized dividend yield to CSL 11.4 % Portfolio Asset Yield Floating Rate First Lien CSL Dividend Yield % of CSL Portfolio $938 11.4% 100.0% 98.4% 12.2% 13.9%
Funding and Capital Management Overview Commitment Outstanding Maturity Date Pricing(1) Credit facility $790 $234 8/31/2028(2) SOFR + 1.88% 2015-1R notes $426 $426 10/15/2031 SOFR + 2.03%(3)(4) 2024 senior notes $190 $190 12/31/2024 4.66% 2028 senior notes $85 $85 12/01/2028 SOFR + 3.14%(5) Total / Weighted Average(3) $1,490 $935 5.1 years 6.81% Overview of Balance Sheet Financing Facilities 8 63% % of Committed Balance Sheet Leverage Utilized % of Utilized Balance Sheet Leverage Mark-To-Market(7) % of Utilized Balance Sheet Leverage Fixed(6) 23% (1) SOFR borrowings are subject to an additional spread adjustment. (2) $135,000 of the $790,000 in principal will mature on May 25, 2027. (3) Represents the weighted average interest rate for the 2015-1R Notes over the various tranches of issued notes, excluding a $23 million note that has a fixed interest rate of 4.56%. (4) Weighted average maturity and pricing amounts are calculated based on amount outstanding. (5) Represents the floating interest rate paid by the Company as part of the interest rate swap agreement. The interest rate of the 2028 notes is 8.20%. (6) Includes the $23 million note in the 2015-1R notes that bears a fixed rate. (7) Represents the Credit Facility and 2028 Notes. 34%
Note: The net asset value per share and dividends declared per share are based on the shares outstanding at each respective quarter-end. Net investment income per share and net change in realized and unrealized gain (loss) per share are based on the weighted average number of shares outstanding for the period. Net investment income is also net of the preferred dividend. Totals may not sum due to rounding. Net Asset Value Per Share Bridge LTM Q1 2024Q1 2024 9 $16.99 $0.54 $(0.48) $0.02 $— $17.07 December 31, 2023 NAV Net Investment Income Dividend Declared Net Realized and Unrealized Gain (Loss) Impact of Share Repurchases & Other March 31, 2024 NAV $17.09 $2.14 $(1.80) $(0.36) $— $17.07 March 31, 2023 NAV Net Investment Income Dividend Declared Net Realized and Unrealized Gain (Loss) Impact of Share Repurchases & Other March 31, 2024 NAV
• As of March 31, 2024, one borrower was on non-accrual status, representing 0.2% of total investments at fair value and 0.2% at amortized cost. Risk Rating Distribution RATING DEFINITION 1 Borrower is operating above expectations, and the trends and risk factors are generally favorable. 2 Borrower is operating generally as expected or at an acceptable level of performance. The level of risk to our initial cost basis is similar to the risk to our initial cost basis at the time of origination. This is the initial risk rating assigned to all new borrowers. 3 Borrower is operating below expectations and level of risk to our cost basis has increased since the time of origination. The borrower may be out of compliance with debt covenants. Payments are generally current although there may be higher risk of payment default. 4 Borrower is operating materially below expectations and the loan’s risk has increased materially since origination. In addition to the borrower being generally out of compliance with debt covenants, loan payments may be past due, but generally not by more than 120 days. It is anticipated that we may not recoup our initial cost basis and may realize a loss of our initial cost basis upon exit. 5 Borrower is operating substantially below expectations and the loan’s risk has increased substantially since origination. Most or all of the debt covenants are out of compliance and payments are substantially delinquent. It is anticipated that we will not recoup our initial cost basis and may realize a substantial loss of our initial cost basis upon exit. PORTFOLIO RISK RATINGS (Dollar amounts in millions) December 31, 2023 March 31, 2024 Internal Risk Rating Fair Value % of Fair Value Fair Value % of Fair Value 1 $30.3 2.0 % $0.4 0.0 % 2 1,158.0 77.3 % 1,157.0 80.8 % 3 273.3 18.2 % 270.6 18.9 % 4 38.1 2.5 % 3.8 0.3 % 5 — — % — — % Total $1,499.7 100.0 % $1,431.8 100.0 % 10
11 Appendix
Quarterly Balance Sheet Detail Please refer to the Company’s Form 10-Q for more information. (Dollar amounts in thousands, except per share data) Q1 2023 Q2 2023 Q3 2023 Q4 2023 Q1 2024 ASSETS Investments—non-controlled/non-affiliated, at fair value $ 1,661,414 $ 1,588,732 $ 1,556,390 $ 1,539,120 $ 1,472,096 Investments—non-controlled/affiliated, at fair value 50,996 51,668 52,670 53,382 64,199 Investments—controlled/affiliated, at fair value 261,155 256,020 251,415 249,379 248,598 Total Investments, at Fair Value 1,973,565 1,896,420 1,860,475 1,841,881 1,784,893 Cash, cash equivalents and restricted cash 42,873 54,150 55,218 60,447 69,921 Receivable for investments sold/repaid 6,908 1,396 3 36 66 Interest and dividend receivable 26,174 24,703 33,539 33,725 33,940 Prepaid expenses and other assets 5,887 5,928 7,515 6,489 6,251 Total Assets $2,055,407 $1,982,597 $1,956,750 $1,942,578 $1,895,071 LIABILITIES & NET ASSETS Debt and secured borrowings $ 1,092,707 $ 1,037,185 $ 1,003,296 $ 980,183 $ 930,182 Interest and credit facility fees payable 6,782 7,097 7,340 8,591 8,025 Dividend payable 22,321 22,320 22,321 22,321 24,353 Base management and incentive fees payable 12,729 12,804 12,636 13,067 12,755 Administrative service fees payable 1,221 1,439 2,577 2,991 2,752 Other accrued expenses and liabilities 1,454 2,071 2,136 2,613 184 Total Liabilities $ 1,137,214 $ 1,082,916 $ 1,050,306 $ 1,029,766 $ 978,251 Preferred Stock 50,000 50,000 50,000 50,000 50,000 Total Liabilities and Preferred Stock $ 1,187,214 $ 1,132,916 $ 1,100,306 $ 1,079,766 $ 1,028,251 Net Assets $ 868,193 $ 849,681 $ 856,444 $ 862,812 $ 866,820 Net Asset Value Per Common Share $ 17.09 $ 16.73 $ 16.86 $ 16.99 $ 17.07 12
Quarterly Income Statement Detail Note: There can be no assurance that we will continue to earn income at this rate and our income may decline. If our income declines, we may reduce the dividend we pay and the yield you earn may decline. Refer to the Company’s Form 10-Q for additional details. (1) Inclusive of payment-in-kind interest income. (2) Presented net of the preferred stock dividend for the period. (Dollar amounts in thousands, except per share data) Q1 2023 Q2 2023 Q3 2023 Q4 2023 Q1 2024 INVESTMENT INCOME Interest income(1) 49,136 50,870 51,457 52,056 51,949 Dividend income from credit funds 8,276 8,276 8,276 8,276 8,276 Other income 963 919 768 2,353 1,782 Total Investment Income $ 58,375 $ 60,065 $ 60,501 $ 62,685 $ 62,007 EXPENSES Management fees $ 7,236 $ 7,185 $ 7,080 $ 7,014 $ 6,888 Incentive fees 5,472 5,593 5,530 6,027 5,867 Interest expense and credit facility fees 17,281 17,873 18,222 18,335 17,863 Other expenses 1,293 1,589 1,708 1,782 2,110 Excise tax expense 523 650 850 412 830 Net Expenses $ 31,805 $ 32,890 $ 33,390 $ 33,570 $ 33,558 Preferred stock dividend 875 875 875 875 875 Net Investment Income(2) $ 25,695 $ 26,300 $ 26,236 $ 28,240 $ 27,574 Net realized and change in unrealized gains (losses) 1,417 (22,462) 2,876 478 815 Net Income (Loss)(2) $ 27,112 $ 3,838 $ 29,112 $ 28,718 $ 28,389 Net Investment Income per Common Share $ 0.50 $ 0.52 $ 0.52 $ 0.56 $ 0.54 Net Income (Loss) per Common Share $ 0.53 $ 0.08 $ 0.57 $ 0.57 $ 0.56 13