On February 24, this year, I established a separate investment account specifically for my BDC investments. The idea with this account is to better track and measure the performance of BDCs so that I could, among other things, share the progress with you in aRoberts Berzins has over a decade of experience in the financial management helping top-tier corporates shape their financial strategies and execute large-scale financings. He has also made significant efforts to institutionalize REIT framework in Latvi ...

Q1 2025 Performance Highlights - Adjusted EPS reached $1.60, a 29% increase year-over-year[10, 17] - Adjusted Gross Margin improved to 39.8%, up 140 bps year-over-year[11, 17] - Adjusted EBITDA Margin was 16.6%, an increase of 80 bps year-over-year[11, 17] - Revenue reached $625 million, exceeding the high end of guidance[13] - Organic Revenue Growth was +11% overall, with +14% in the Americas year-over-year[13] - Orders increased by 18% year-over-year[13, 18] Cash Flow and Capital Deployment - Free Cash Flow for the trailing twelve months was $220 million[12, 13] - The company repurchased 1.0 million shares for $100 million year-to-date through April 2025[13] Segment Performance - Automation Solutions organic revenue increased by 16% year-over-year[20] - Smart Infrastructure Solutions organic revenue increased by 6% year-over-year[20] Q2 2025 Guidance - Total Revenue is projected to be between $645 million and $660 million[29] - Adjusted EPS is expected to be between $1.67 and $1.77[29]

Financial Data and Key Metrics Changes - Revenue for the first quarter totaled $625 million, up 17% year over year, exceeding the high end of guidance [7][14] - Earnings per share (EPS) came in at $1.60, up 29% compared to the prior year [7][17] - Gross margins were 39.8%, an increase of 40 basis points year over year, marking the highest since the strategic transformation began in 2020 [7][16] - Adjusted EBITDA margins improved to 16.6%, up 80 basis points year over year [7][17] - Free cash flow for the trailing twelve months was $220 million, representing 9% of total revenue [9][20] Business Line Data and Key Metrics Changes - Automation Solutions revenue grew 16% year over year, with orders up 22% [14][18] - Smart Infrastructure Solutions revenue increased by 17% year over year, with orders up 13% [14][19] - Broadband revenue was up year over year, driven by a 9% organic growth in fiber [19] Market Data and Key Metrics Changes - Organic growth for the overall business was 11%, with The Americas leading at 14% [8][14] - Orders were up 18% year over year, with a book-to-bill ratio of 1.05 [8][14] Company Strategy and Development Direction - The company is focused on a solutions transformation that enhances customer relationships and drives repeat business [10][12] - There is a strategic emphasis on acquisitions that support the solutions transformation and returning capital to shareholders through buybacks [9][10] - The company aims to bridge the gap between industrial and enterprise applications, leveraging its broad product portfolio [12][30] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about long-term growth driven by trends such as reindustrialization, digitization, and automation [27][30] - There is an expectation of continued uncertainty in the near term due to trade policy, but a positive long-term outlook remains [27][28] - Signs of recovery in global manufacturing PMIs were noted, indicating potential for broader industrial recovery [29][30] Other Important Information - The company has a strong balance sheet with a cash position of $259 million and a net debt to EBITDA ratio of 2.0 times [20] - The next debt maturity is not until 2027, with all debt fixed at an average rate of 3.5% [22] Q&A Session Summary Question: Comments on reshoring interest among manufacturers - Management noted increased confidence among large customers regarding reshoring manufacturing to the US, with discussions around long-term plans and IT/OT convergence [36][38] Question: Insights on book-to-bill in Smart Infrastructure - Smart Buildings orders were up about 8%, while Broadband orders were up 18%, indicating stronger performance in Broadband [40][41] Question: Demand pull forward and its impact - Management has not seen significant demand pull forward but noted increased interest and discussions from customers about deploying solutions [51][52] Question: Exposure to tariffs and sourcing strategies - The largest exposure is to Mexico, with most products having exemptions under USMCA, and no manufacturing in China for the US market [57][58] Question: Long-term EPS growth targets - The company is still targeting a 10% to 12% EPS CAGR but did not provide further updates on the $8 EPS goal for 2025 [59][60] Question: Margin performance between segments - Strong performance in Industrial Solutions was noted, while Smart Infrastructure experienced a sequential drop due to revenue leverage [62][64] Question: Free cash flow management - The focus remains on improving supply chain management and inventory turns, with a goal to increase free cash flow margin closer to 10% [74][75]

Financial Data and Key Metrics Changes - Revenue for the first quarter totaled $625 million, up 17% year over year, exceeding the high end of guidance [7][14] - Earnings per share (EPS) came in at $1.60, up 29% compared to the prior year [7][14] - Gross margins were 39.8%, an increase of 40 basis points year over year, marking the highest since the strategic transformation began in 2020 [7][15] - Adjusted EBITDA margins improved to 16.6%, up 80 basis points year over year [7][14] Business Line Data and Key Metrics Changes - Automation Solutions revenue increased by 16% year over year, with orders up 22% [14][17] - Smart Infrastructure Solutions revenue grew by 17% year over year, with orders up 13% [14][18] - Organic growth for the overall business was 11%, with The Americas leading at 14% [8][14] Market Data and Key Metrics Changes - Orders were up 18% year over year, with a book-to-bill ratio of 1.05 [8][14] - The Americas and APAC regions showed strong growth, while EMEA was the slowest growing region but still achieved organic growth [17][18] - Broadband revenue increased year over year, driven by a 9% organic growth in fiber [19] Company Strategy and Development Direction - The company is focused on solutions transformation, which is expected to drive future growth opportunities [7][10] - There is a strategic emphasis on reshoring and IT/OT convergence, with increased interest from customers in investing in these areas [38][39] - The company aims to maintain a disciplined capital allocation strategy, targeting acquisitions and share repurchases [9][20] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about long-term growth driven by trends such as reindustrialization, digitization, and automation [27][31] - There is an expectation of continued uncertainty in the near term due to trade policy, but a positive long-term outlook remains [28][29] - Signs of recovery in global manufacturing PMIs were noted, indicating potential for broader industrial recovery [30] Other Important Information - The company generated strong free cash flow of $220 million, representing 9% of total revenue [9][20] - The balance sheet remains strong, with a net debt to EBITDA ratio of 2.0 times [20] - The next debt maturity is not until 2027, with all debt fixed at an average rate of 3.5% [22] Q&A Session Summary Question: Comments on reshoring interest among manufacturers - Management noted increased confidence among large customers regarding reshoring manufacturing to the US, with discussions around long-term plans [36][38] Question: Insights on book-to-bill in smart infrastructure - Smart Buildings orders were up about 8%, while Broadband orders were up 18%, indicating stronger performance in broadband [40][41] Question: Quantifying discussions on reshoring - Management indicated that discussions around reshoring have increased significantly, with a sales funnel growth in the high teens [47][50] Question: Demand pull forward observations - No significant demand pull forward was observed, but there is increased interest and discussions from customers about future deployments [51][52] Question: Exposure to tariffs and sourcing changes - The largest exposure is to Mexico, with most products having exemptions under USMCA, and efforts are ongoing to adjust sourcing from China [56][57] Question: Long-term EPS growth target - The company reiterated its target of 10% to 12% EPS CAGR but did not provide updates on the specific $8 EPS goal for 2025 [58][59] Question: Margin performance between segments - Strong performance in Industrial Solutions was noted, while Smart Infrastructure experienced a sequential drop due to seasonal impacts [61][63] Question: Learnings from combined sales force - The transition to autonomous systems is seen as a multi-step journey, with customers increasingly seeking digitization and integration of IT and OT [66][68] Question: Free cash flow management - The focus remains on improving supply chain efficiency and managing working capital to enhance free cash flow margins [71][73]

Financial Performance - Revenues for Q1 2025 increased by $89 million, or 17%, to $625 million from $536 million in the prior year[4] - Organic revenue growth was 11%, with Automation Solutions up 16% and Smart Infrastructure Solutions up 6%[4] - Net income for the quarter was $52 million, compared to $37 million in the year-ago period, representing a net income margin of 8.3%[4] - Adjusted EBITDA was $104 million, up $19 million, or 23%, with an adjusted EBITDA margin of 16.6%[5] - GAAP EPS for the quarter was $1.27, up 41% year-over-year, while adjusted EPS was $1.60, increasing 29% year-over-year[8] - Revenues for the three months ended March 30, 2025, were $624,861,000, an increase of 16.6% compared to $535,675,000 for the same period in 2024[19] - GAAP net income for the three months ended March 30, 2025, was $51,937,000, representing a 39.2% increase from $37,309,000 in the same period of 2024[19] - Adjusted net income attributable to Belden stockholders was $65,485,000 for the three months ended March 30, 2025, compared to $51,276,000 for the same period in 2024[19] - GAAP income per diluted share attributable to Belden stockholders for the three months ended March 30, 2025, was $1.27, up from $0.90 in the same period of 2024[19] - Adjusted EBITDA for the three months ended March 30, 2025, was $103,965,000, compared to $84,748,000 for the same period in 2024, reflecting an adjusted EBITDA margin of 16.6%[19] - The company reported GAAP gross profit margin of 39.3% for the three months ended March 30, 2025, compared to 37.6% for the same period in 2024[19] Future Guidance - For Q2 2025, revenues are expected to be between $645 million and $660 million, representing a 7% to 9% increase year-over-year[6] - GAAP EPS guidance for Q2 2025 is between $1.25 and $1.35, while adjusted EPS is expected to be between $1.67 and $1.77[9] - The company provided guidance for GAAP income per diluted share for the second quarter of 2025, estimating a range of $1.25 to $1.35[22] Shareholder Actions - The company repurchased 1.0 million shares for $100 million year-to-date through April 30, 2025[3] Strategic Investments - The company continues to invest in automation and smart infrastructure technologies to capitalize on reindustrialization trends[7] Asset Management - Total current assets decreased to $1,132.5 million from $1,196.2 million as of December 31, 2024[14] Cash Flow - Free cash flow for the three months ended March 30, 2025, was $(24,655,000), compared to $(21,469,000) for the same period in 2024[21] Importance of Adjusted Results - The company highlighted the importance of adjusted results for evaluating ongoing operations and underlying business trends[17]

Group 1 - The article discusses the recent changes in the valuation of Business Development Companies (BDCs), indicating that many were previously overvalued but the situation has now shifted [1] - The investment group Trade With Beta is mentioned, which focuses on identifying mispriced preferred stocks and baby bonds, along with providing weekly reviews of over 1200 equities and IPO previews [1] - The article highlights a beneficial long position in GSBD, indicating a positive outlook on this particular stock [1] Group 2 - There is a mention of a short position on OXSQ, suggesting a bearish outlook on this specific investment [2] - The article emphasizes that past performance does not guarantee future results, indicating a cautious approach to investment recommendations [2] - It clarifies that the views expressed may not reflect those of Seeking Alpha as a whole, highlighting the diversity of opinions among analysts [2]

Group 1 - The analyst has been monitoring major Business Development Companies (BDCs) for over three years, yielding positive total returns and dividends [1] - Roberts Berzins has over a decade of experience in financial management, focusing on corporate financial strategies and large-scale financings [1] - Berzins has contributed to the institutionalization of the REIT framework in Latvia to enhance liquidity in pan-Baltic capital markets [1] Group 2 - The analyst holds a beneficial long position in MSDL and CION through various financial instruments [2] - The article reflects the author's personal opinions and is not influenced by compensation from any company mentioned [2] Group 3 - Seeking Alpha emphasizes that past performance does not guarantee future results and does not provide specific investment recommendations [3]

Group 1 - Mr. Mavroudis is a professional portfolio manager with expertise in institutional and private portfolios, focusing on risk management and financial market analysis [1] - He has successfully navigated major crises, including the COVID-19 pandemic and the PSI, demonstrating resilience in portfolio management [1] - Mr. Mavroudis holds multiple advanced degrees and certifications, including an MSc in Financial and Banking Management and is a certified portfolio manager by the Hellenic Capital Market Commission [1] Group 2 - He is the CEO of FAST FINANCE Investment Services, a registered Greek company, indicating a strong presence in the financial services industry [1] - Mr. Mavroudis engages with the investment community through writing articles and participating in educational seminars, contributing to knowledge sharing [1]

Group 1 - The article discusses market activity in the Business Development Company (BDC) sector, focusing on both individual news and events as well as broader market trends [1] - It highlights the importance of yield and risk management considerations in investment strategies within the BDC sector [1] - The article promotes the use of Interactive Investor Tools for navigating various investment markets, including BDCs, Closed-End Funds (CEFs), and preferred securities [2] Group 2 - The article encourages readers to explore Investor Guides related to CEFs and preferred securities, indicating a focus on educational resources for investors [2] - A promotional offer for a 2-week free trial is mentioned, suggesting an effort to attract new investors to the platform [2]

Lately, I have been thinking more and more about my BDC portfolio and how the underlying picks could perform going forward considering the multiplicity of risk that stem, primarily, from the current policymaking arena.Roberts Berzins has over a decade of experience in the financial management helping top-tier corporates shape their financial strategies and execute large-scale financings. He has also made significant efforts to institutionalize REIT framework in Latvia to boost the liquidity of pan-Baltic ca ...