NEW YORK, July 15, 2025 (GLOBE NEWSWIRE) -- Carlyle Secured Lending, Inc. (“Carlyle Secured Lending”) (NASDAQ: CGBD) will host a conference call at 11:00 a.m. EST on Wednesday, August 6, 2025 to announce its financial results for the second quarter ended June 30, 2025. The Company will report its quarterly financial results on Tuesday, August 5, 2025. The conference call will be available via public webcast via a link on Carlyle Secured Lending’s website at carlylesecuredlending.com and will also be availab ...

Core Insights - Carlyle Secured Lending Inc. (NASDAQ: CGBD) has faced a significant decline in portfolio quality and dividend payout ratio in the first quarter of 2025, raising concerns about the sustainability of its current dividend payments [1] Company Summary - The company has reported a substantial decrease in the quality of its investment portfolio, which may impact its financial stability and future dividend distributions [1]

Group 1 - Carlyle Secured Lending (CGBD) reported Q1 results with a dividend yield of 11.5% and a 16% discount to NAV [1] - The net investment income price yield for CGBD is 11.8%, which aligns with market expectations [1]

Core Viewpoint - Small-cap stocks are currently undervalued, presenting potential investment opportunities, especially those offering high dividend yields ranging from 8.3% to 17.1% [2] Group 1: Small-Cap Stocks Overview - The valuation gap between the S&P 500 and S&P 600 is at its widest since the late 1990s, suggesting small-cap stocks are significantly cheaper [2] - The article discusses five small-cap stocks with attractive dividend yields, indicating a potential for high returns despite their current low valuations [2] Group 2: Playtika Holding (PLTK) - Playtika, a mobile game developer, has a dividend yield exceeding 8% but has not raised its payout recently, indicating a decline in earnings and sales [4][5] - Analysts project a 32% increase in profits for 2024, despite the company's struggles in the competitive mobile gaming market [6] - Playtika's valuation is low at 6 times forward earnings, but there are concerns about its growth prospects [7] Group 3: Carlyle Secured Lending (CGBD) - CGBD is a business development company focused on U.S. middle-market companies, primarily investing in first-lien debt [8][9] - Recent earnings reports have shown disappointing results, with an increase in non-accrual loans and a stagnant base dividend of 40 cents per share [10][11] - CGBD shares are trading at a 16% discount to net asset value, but operational challenges raise concerns about future dividend sustainability [12] Group 4: Bain Capital Specialty Finance (BCSF) - BCSF provides financing solutions to a diverse range of companies, with a significant portion of its investments in first-lien debt [13][14] - The company has maintained its regular dividend but has introduced special dividends, raising concerns about future dividend coverage due to declining net investment income projections [16][17] - Analysts expect BCSF's dividend ratios to be high, leaving little room for error in case of operational difficulties [17] Group 5: Two Harbors Investment Corp. (TWO) - TWO operates in the mortgage REIT sector, focusing on mortgage servicing rights and agency residential mortgage-backed securities [19][22] - The company has faced significant share price declines, resulting in a high yield of over 17%, but recent litigation charges could impact its book value and dividend sustainability [24][25] - TWO's current dividend rate of 45 cents per share is at risk due to the potential impact of litigation on earnings available for distribution [25] Group 6: Franklin BSP Realty Trust (FBRT) - FBRT is a mortgage REIT focused on commercial mortgage-backed securities, with a significant portion of its portfolio in multifamily properties [26][27] - The company is trading at a 28% discount to book value, with a low P/E ratio based on 2026 earnings estimates, indicating potential value [28] - Concerns exist regarding the stability of its dividend, as the payout has not changed since 2021, and market conditions could necessitate a review of the dividend policy [29][30]

Financial Data and Key Metrics Changes - In Q1 2025, the company generated GAAP net investment income of $0.40 per share and adjusted net investment income of $0.41 per share, representing a decline of $0.04 per share from the prior quarter due to tighter yields and lower base rates [7][14] - The net asset value (NAV) as of March 31 was $16.63 per share, down from $16.80 per share as of December 31 [8] - Total investment income for the first quarter was $55 million, consistent with the prior quarter, while total expenses increased to $33 million primarily due to higher interest expenses [13] Business Line Data and Key Metrics Changes - The company added approximately $180 million in organic originations to its portfolio during the quarter, despite muted sponsor M&A activity [8] - The total size of the portfolio increased from $1.9 billion to $2.5 billion, bolstered by the merger with CSL3 and the consolidation of Credit Fund II [9] - The portfolio comprised 195 investments in 138 companies across more than 25 industries, with 94% of investments in senior secured loans [12] Market Data and Key Metrics Changes - The broadly syndicated and private credit markets remained competitive, with recent volatility around tariffs posing a near-term headwind to capital markets and M&A activity [9][10] - Non-accruals increased to 1.6% of total investments at fair value, indicating some underperformance in a handful of names [17] Company Strategy and Development Direction - The strategic merger with CSL3 is expected to improve liquidity and reduce costs while maintaining the existing investment strategy due to the near 100% overlap between the portfolios [11] - The company is focused on overall credit performance and diversification, with a selective underwriting approach to take quality credits at the top of the capital structure [10][11] Management's Comments on Operating Environment and Future Outlook - Management noted minimal direct risk from tariffs, estimating that less than 5% of the portfolio has material direct exposure [10] - The company anticipates a strong pipeline of transactions in the second quarter, aiming to reach its target leverage range of 1.0 [35][36] Other Important Information - The Board of Directors declared a second-quarter dividend of $0.40 per share, representing an attractive yield of about 11% based on the recent share price [15] - The company has $0.85 per share of spillover income generated over the last five years, providing comfort in maintaining the base dividend [15] Q&A Session Summary Question: On the credit fund, what does the dividend look like going forward? - Management indicated that the dividend is expected to be flat in the near term, with overall NII being roughly neutral due to higher ROE on a lower capital base [25] Question: Is there any asset rotation expected post-merger? - Management confirmed that the merger resulted in a reduction in yield by about 15 basis points, with plans to selectively rotate lower spread assets into the current joint venture for better returns [31][32] Question: How does the company plan to drive leverage back into the target range? - Management aims to achieve the target leverage range over the next couple of quarters, with a strong pipeline of transactions anticipated for the second quarter [35][36] Question: How much spillover income is expected to support the dividend? - Management stated that while spillover income may support the dividend, the extent and speed of the impact from the SOFR curve remain uncertain [39][42]

Carlyle Secured Lending (CGBD) Q1 2025 Earnings Call May 07, 2025 11:00 AM ET Speaker0 Hello. Good day, and thank you for standing by. Welcome to the Carlyle Secured Lending, Inc. First Quarter twenty twenty five Earnings Call. At this time, all participants are in a listen only mode. After the speakers' presentation, there will be a question and answer session. Please be advised that today's conference is being recorded. I would now like to hand the conference over to your speaker today, Michel Mehta, Head ...

Company Performance - Carlyle Secured Lending, Inc. (CGBD) reported quarterly earnings of $0.41 per share, missing the Zacks Consensus Estimate of $0.43 per share, and down from $0.54 per share a year ago, representing an earnings surprise of -4.65% [1] - The company posted revenues of $36.26 million for the quarter ended March 2025, missing the Zacks Consensus Estimate by 15.40%, and down from $44.14 million year-over-year [2] - Over the last four quarters, Carlyle Secured Lending has surpassed consensus EPS estimates three times, but has topped consensus revenue estimates only once [2] Stock Performance - Carlyle Secured Lending shares have declined approximately 20.6% since the beginning of the year, compared to a decline of -3.9% for the S&P 500 [3] - The current consensus EPS estimate for the upcoming quarter is $0.45 on revenues of $53.34 million, and for the current fiscal year, it is $1.71 on revenues of $200.34 million [7] Industry Outlook - The Zacks Industry Rank for Financial - SBIC & Commercial Industry is currently in the bottom 45% of over 250 Zacks industries, indicating potential challenges for stocks in this sector [8] - Empirical research shows a strong correlation between near-term stock movements and trends in earnings estimate revisions, suggesting that the outlook for the industry can significantly impact stock performance [5][8]

Carlyle Secured Lending, Inc. Quarterly Earnings Presentation March 31, 2025 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," "CGBD" 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 7, 2025 and the Company's Quarterl ...

Part I. Financial Information [Financial Statements](index=3&type=section&id=Item%201.%20Financial%20Statements) This section presents the unaudited consolidated financial statements for Carlyle Secured Lending, Inc., detailing its financial position, operations, and cash flows for Q1 2025 and 2024 [Consolidated Statements of Assets and Liabilities](index=3&type=section&id=Consolidated%20Statements%20of%20Assets%20and%20Liabilities) The Consolidated Statements of Assets and Liabilities show a significant increase in total assets from **$1.93 billion** at year-end 2024 to **$2.53 billion** as of March 31, 2025, primarily driven by a rise in total investments at fair value Consolidated Balance Sheet Highlights (in thousands, except per share data) | Metric | March 31, 2025 (unaudited) | December 31, 2024 | | :--- | :--- | :--- | | Total investments, at fair value | $2,245,626 | $1,803,543 | | Total assets | $2,533,808 | $1,925,993 | | Debt and secured borrowings | $1,247,186 | $960,949 | | Total liabilities | $1,321,419 | $1,020,789 | | Total net assets | $1,212,389 | $905,204 | | Net assets per common share | $16.63 | $16.80 | [Consolidated Statements of Operations](index=4&type=section&id=Consolidated%20Statements%20of%20Operations) For the three months ended March 31, 2025, the company reported total investment income of **$54.9 million**, a decrease from **$62.0 million** in the prior year period, resulting in a net increase in net assets from operations of **$14.1 million** Consolidated Operations Highlights (in thousands, except per share data) | Metric | Three Months Ended March 31, 2025 | Three Months Ended March 31, 2024 | | :--- | :--- | :--- | | Total investment income | $54,864 | $62,007 | | Total expenses | $32,559 | $32,728 | | Net investment income (loss) | $21,629 | $28,449 | | Net increase in net assets from operations | $14,054 | $29,264 | | Basic earnings per common share | $0.25 | $0.56 | | Diluted earnings per common share | $0.25 | $0.52 | [Consolidated Statements of Changes in Net Assets](index=6&type=section&id=Consolidated%20Statements%20of%20Changes%20in%20Net%20Assets) Net assets increased by **$307.2 million** during Q1 2025, reaching **$1.21 billion**, primarily driven by capital transactions including the CSL III Merger and Preferred Stock Exchange - Net assets increased from **$905.2 million** at the beginning of the period to **$1,212.4 million** at the end of the period[10](index=10&type=chunk) - Key capital transactions included the issuance of **$315.8 million** in common stock for the CSL III Merger and a **$50.0 million** common stock issuance related to the Preferred Stock Exchange[10](index=10&type=chunk) [Consolidated Statements of Cash Flows](index=7&type=section&id=Consolidated%20Statements%20of%20Cash%20Flows) Net cash provided by operating activities was **$145.8 million**, leading to a net increase in cash of **$194.3 million**, bringing the end-of-period balance to **$250.9 million** Cash Flow Summary (in thousands) | Cash Flow Activity | Three Months Ended March 31, 2025 | Three Months Ended March 31, 2024 | | :--- | :--- | :--- | | Net cash provided by operating activities | $145,801 | $81,005 | | Net cash provided by (used in) financing activities | $48,507 | $(71,531) | | Net increase in cash, cash equivalents and restricted cash | $194,308 | $9,474 | | Cash, cash equivalents and restricted cash, end of period | $250,883 | $69,921 | - Significant non-cash activities in Q1 2025 included the acquisition of CSL III, which involved assuming **$483.7 million** in investments and **$206.0 million** in debt, and the issuance of **$315.8 million** in common stock[13](index=13&type=chunk) [Consolidated Schedules of Investments](index=9&type=section&id=Consolidated%20Schedules%20of%20Investments) The investment portfolio had a fair value of **$2.25 billion**, heavily concentrated in First Lien Debt (**83.4%**), diversified across industries, with most investments in the U.S. and nearly all debt at floating rates Investment Portfolio Composition by Type (March 31, 2025) | Type | Fair Value | % of Fair Value | | :--- | :--- | :--- | | First Lien Debt | $1,873,091 | 83.4% | | Second Lien Debt | $129,629 | 5.8% | | Equity Investments | $121,515 | 5.4% | | Investment Funds | $121,391 | 5.4% | | **Total** | **$2,245,626** | **100.0%** | Top 5 Industry Concentrations by Fair Value (March 31, 2025) | Industry | % of Fair Value | | :--- | :--- | | Healthcare & Pharmaceuticals | 13.5% | | Software | 13.2% | | Consumer Services | 8.2% | | Diversified Financial Services | 7.7% | | Business Services | 7.1% | - As of March 31, 2025, the company had total unfunded commitments of **$263.5 million**, consisting of **$157.7 million** in delayed draw commitments and **$105.7 million** in revolving loan commitments[270](index=270&type=chunk)[395](index=395&type=chunk) [Notes to Consolidated Financial Statements (unaudited)](index=43&type=section&id=Notes%20to%20Consolidated%20Financial%20Statements%20(unaudited)) The notes detail accounting policies and significant events, including the CSL III merger, Credit Fund II acquisition, preferred stock exchange, and changes to debt facilities - On March 27, 2025, the company completed its merger with CSL III, issuing **18,935,108 shares** of common stock, adding assets with a fair value of **$539.3 million** and liabilities of **$223.7 million**[74](index=74&type=chunk)[302](index=302&type=chunk)[305](index=305&type=chunk) - On February 11, 2025, the company acquired the remaining membership interest in Middle Market Credit Fund II (Credit Fund II), making it a wholly-owned subsidiary, treated as an asset acquisition[72](index=72&type=chunk)[210](index=210&type=chunk) - In connection with the CSL III merger, all **2,000,000** outstanding shares of preferred stock were exchanged for **3,004,808 shares** of common stock on March 27, 2025, with no preferred stock outstanding as of March 31, 2025[73](index=73&type=chunk)[168](index=168&type=chunk)[273](index=273&type=chunk) - The company's asset coverage ratio was **196.3%** as of March 31, 2025, well above the required minimum of **150%**[229](index=229&type=chunk)[401](index=401&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=86&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) In Q1 2025, the company completed transformative mergers, significantly increasing portfolio size to **$2.2 billion**, while managing a slight NAV per share decrease and maintaining strong liquidity [First Quarter 2025 Highlights](index=88&type=section&id=First%20Quarter%202025%20Highlights) Q1 2025 saw significant strategic transactions, expanding the investment portfolio to **$2.2 billion**, with net investment income of **$0.40 per share** and robust total liquidity of **$858.5 million** - Completed the merger with CSL III on March 27, 2025, and the purchase of **100%** ownership in Credit Fund II on February 11, 2025[321](index=321&type=chunk) - Net investment income was **$20.8 million**, or **$0.40 per common share**, with adjusted NII per share at **$0.41**[321](index=321&type=chunk) - NAV per common share decreased to **$16.63** from **$16.80** at the end of the prior quarter[321](index=321&type=chunk) - Total liquidity as of March 31, 2025 was **$858.5 million**, comprising cash and undrawn debt capacity[326](index=326&type=chunk) [Portfolio and Investment Activity](index=93&type=section&id=Portfolio%20and%20Investment%20Activity) The investment portfolio totaled **$2.25 billion**, dominated by first lien debt, with high investment activity driven by mergers and acquisitions, while credit quality remained stable despite an increase in non-accrual investments Portfolio Investment Activity (Q1 2025, at amortized cost) | Activity | Amount (in thousands) | | :--- | :--- | | Total investments, beginning of period | $1,848,212 | | New investments purchased | $325,914 | | Transfer in - CSL III Merger | $485,673 | | Transfer in - Credit Fund II Purchase | $191,201 | | Investments sold or repaid | $(558,441) | | **Total Investments, end of period** | **$2,273,998** | Internal Risk Ratings of Debt Portfolio (by Fair Value) | Rating | March 31, 2025 | December 31, 2024 | | :--- | :--- | :--- | | 1 (Lowest Risk) | 0.0% | 0.0% | | 2 | 89.7% | 87.4% | | 3 | 8.5% | 12.0% | | 4 | 1.8% | 0.5% | | 5 (Highest Risk) | 0.0% | 0.1% | - Non-accrual investments represented **1.6%** of the total portfolio at fair value as of March 31, 2025, an increase from **0.6%** at December 31, 2024[342](index=342&type=chunk)[373](index=373&type=chunk) [Consolidated Results of Operations](index=101&type=section&id=Consolidated%20Results%20of%20Operations) Total investment income decreased by **$7.1 million** to **$54.9 million**, and net investment income fell by **$6.8 million** to **$21.6 million**, primarily due to lower portfolio yields and increased non-accruals Results of Operations Comparison (in thousands) | Metric | Q1 2025 | Q1 2024 | Change | | :--- | :--- | :--- | :--- | | Total investment income | $54,864 | $62,007 | $(7,143) | | Total expenses | $33,235 | $33,558 | $(323) | | Net investment income | $21,629 | $28,449 | $(6,820) | | Net increase in net assets from operations | $14,054 | $29,264 | $(15,210) | - The decrease in investment income YoY was driven by lower yields on the portfolio, stemming from lower base rates, new issue spreads, repricing of existing loans, and an increase in non-accruals[381](index=381&type=chunk) - Interest expense increased by **$0.7 million** YoY due to a higher average principal balance, partially offset by lower benchmark rates[384](index=384&type=chunk) - A significant realized loss of **$22.5 million** was recognized in Q1 2025, primarily related to the restructuring of an investment in Aimbridge Acquisition Co., Inc. and the consolidation of Credit Fund II[378](index=378&type=chunk)[388](index=388&type=chunk) [Financial Condition, Liquidity and Capital Resources](index=105&type=section&id=Financial%20Condition,%20Liquidity%20and%20Capital%20Resources) The company maintained a strong liquidity position of **$858.5 million**, sufficient to cover unfunded commitments, with a statutory debt-to-equity ratio of **1.04x** and an asset coverage ratio of **196.3%** Sources of Liquidity (in thousands) | Source | March 31, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Cash, cash equivalents and restricted cash | $250,883 | $56,575 | | Available borrowings under Credit Facilities | $607,608 | $509,121 | | **Total Liquidity** | **$858,491** | **$565,696** | - Total outstanding consolidated indebtedness was **$1.26 billion** as of March 31, 2025[390](index=390&type=chunk) - The asset coverage ratio was **196.3%** as of March 31, 2025, compared to the **150%** minimum requirement[401](index=401&type=chunk) [Quantitative and Qualitative Disclosures About Market Risk](index=107&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) The company is primarily exposed to valuation and interest rate risks, with **99.4%** of debt investments at floating rates, and a **100 basis point** interest rate increase would boost annual net investment income by **$10.4 million** - The company's primary market risks are valuation risk for its illiquid investments and interest rate risk[403](index=403&type=chunk) - As of March 31, 2025, approximately **99.4%** of the company's debt investments (by fair value) bear interest at floating rates, making income sensitive to interest rate changes[405](index=405&type=chunk) Annualized Interest Rate Sensitivity Analysis (as of March 31, 2025, in thousands) | Basis Point Change | Impact on Interest Income | Impact on Interest Expense | Net Impact on Investment Income | | :--- | :--- | :--- | :--- | | Up 300 bps | $60,064 | $(28,775) | $31,289 | | Up 200 bps | $40,042 | $(19,183) | $20,859 | | Up 100 bps | $20,021 | $(9,592) | $10,429 | | Down 100 bps | $(20,021) | $9,592 | $(10,429) | [Controls and Procedures](index=108&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded that the company's disclosure controls and procedures were effective as of March 31, 2025, with no material changes to internal control over financial reporting during the quarter - The Chief Executive Officer and Chief Financial Officer concluded that the company's disclosure controls and procedures were effective as of the end of the period[411](index=411&type=chunk) - No material changes to the internal control over financial reporting were identified during the first quarter of 2025[412](index=412&type=chunk) Part II. Other Information [Legal Proceedings](index=109&type=section&id=Item%201.%20Legal%20Proceedings) The company is not currently subject to any material legal proceedings, nor is it aware of any material threats - As of the report date, the Company is not subject to any material legal proceedings[414](index=414&type=chunk) [Risk Factors](index=109&type=section&id=Item%201A.%20Risk%20Factors) This section highlights the risk of tariffs adversely affecting portfolio companies by increasing costs or reducing demand, and refers readers to the 2024 Form 10-K for extensive risk factors - The company notes that tariffs imposed on foreign or U.S. goods could adversely affect its portfolio companies by increasing production costs or reducing product demand[416](index=416&type=chunk) - Investors are referred to the more extensive risk factors section in the 2024 Form 10-K[415](index=415&type=chunk) [Unregistered Sales of Equity Securities and Use of Proceeds](index=109&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) No unregistered equity securities were sold, and no shares were repurchased under the **$200 million** stock repurchase program during the quarter, with approximately **$42.3 million** remaining - No unregistered equity securities were sold during the period[417](index=417&type=chunk) Issuer Purchases of Equity Securities (Q1 2025) | Period | Total Shares Purchased | Average Price Paid Per Share | Maximum Value Remaining for Purchase | | :--- | :--- | :--- | :--- | | Jan 1 - Jan 31, 2025 | 0 | $0 | $42,263 | | Feb 1 - Feb 28, 2025 | 0 | $0 | $42,263 | | Mar 1 - Mar 31, 2025 | 0 | $0 | $42,263 | - The Board of Directors continued the **$200 million** stock repurchase program until November 5, 2025, with approximately **$42.3 million** remaining available as of March 31, 2025[420](index=420&type=chunk) [Defaults Upon Senior Securities](index=110&type=section&id=Item%203.%20Defaults%20Upon%20Senior%20Securities) The company reported no defaults upon its senior securities during the period - There were no defaults upon senior securities[421](index=421&type=chunk) [Mine Safety Disclosures](index=110&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) This item is not applicable to the company - This item is not applicable to the company[422](index=422&type=chunk) [Other Information](index=110&type=section&id=Item%205.%20Other%20Information) No director or Section 16 officer adopted or terminated any Rule 10b5-1 or non-Rule 10b5-1 trading arrangements in Q1 2025 - No director or Section 16 officer adopted or terminated any Rule 10b5-1 or non-Rule 10b5-1 trading arrangements in Q1 2025[423](index=423&type=chunk) [Exhibits](index=111&type=section&id=Item%206.%20Exhibits) This section lists the exhibits filed with the Form 10-Q, including amended credit and partnership agreements, preferred stock exchange agreements, and officer certifications

[Q1 2025 Highlights](index=5&type=section&id=Q1%202025%20Quarterly%20Highlights) CGBD reported Q1 2025 NII of $0.40 per share, driven by the CSL III merger and credit facility expansion [Q1 2025 Performance and Strategic Activities](index=5&type=section&id=Q1%202025%20Quarterly%20Highlights) Carlyle Secured Lending reported Q1 2025 Net Investment Income of $0.40 per share, marked by significant strategic activities and a slight NAV per share decrease Key Q1 2025 Performance Metrics | Metric | Value | | :--- | :--- | | Net Investment Income per Share | $0.40 | | Adjusted Net Investment Income per Share | $0.41 | | NAV per Share (as of 03/31/25) | $16.63 | | Q2 2025 Declared Base Dividend | $0.40 | | Annualized Dividend Yield on NAV | 9.6% | - Successfully completed the merger with CSL III on March 27, 2025, resulting in a **$485.7 million increase in portfolio fair value** and the issuance of **18.9 million new shares**[13](index=13&type=chunk) - The portfolio's fair value reached **$2.2 billion** across **138 companies**, with a weighted average yield of **10.9%**. Non-accrual investments increased to **1.6%** of the portfolio at fair value, up from **0.6%** in the previous quarter[13](index=13&type=chunk) - Capital and liquidity were strengthened by amending the Credit Facility to increase commitments to **$935.0 million** and extend the maturity to March 2030. Statutory leverage stood at **1.04x** with total liquidity of **$858.5 million**[13](index=13&type=chunk)[14](index=14&type=chunk) [Financial Performance](index=7&type=section&id=Financial%20Performance) CGBD's Q1 2025 financial performance saw a decline in Net Investment Income and total investment income compared to the prior quarter [Quarterly Operating Results](index=7&type=section&id=Quarterly%20Operating%20Results%20Detail) For Q1 2025, CGBD reported a decrease in Net Investment Income and total investment income compared to the prior quarter Quarterly Operating Results (in thousands) | (In thousands, except per share) | Q1 2025 | Q4 2024 | Change (QoQ) | | :--- | :--- | :--- | :--- | | Total Investment Income | $54,864 | $56,354 | -2.6% | | Net Investment Income (NII) | $20,803 | $24,171 | -14.0% | | NII per Common Share | $0.40 | $0.47 | -14.9% | | Adjusted NII per Common Share | $0.41 | $0.47 | -12.8% | | Net Income (Loss) | $13,228 | $20,482 | -35.4% | [Quarterly Financial Condition](index=9&type=section&id=Quarterly%20Financial%20Condition%20Detail) As of March 31, 2025, total assets significantly increased due to the CSL III merger, while NAV per share slightly decreased and leverage improved Quarterly Financial Condition (in thousands) | (In thousands, except per share) | Q1 2025 | Q4 2024 | Change (QoQ) | | :--- | :--- | :--- | :--- | | Total Investments, at fair value | $2,245,626 | $1,803,543 | +24.5% | | Total Assets | $2,533,808 | $1,925,993 | +31.6% | | Debt and secured borrowings | $1,247,186 | $960,949 | +29.8% | | Net Assets | $1,212,389 | $905,204 | +34.0% | | Net Asset Value per Common Share | $16.63 | $16.80 | -1.0% | - The statutory debt-to-equity ratio decreased to **1.04x** in Q1 2025 from **1.20x** in Q4 2024, reflecting a more conservative leverage profile post-merger[17](index=17&type=chunk) - The portfolio composition shifted more heavily towards first-lien debt, which now constitutes **83.4%** of total investments by fair value, up from **73.4%** in the previous quarter[17](index=17&type=chunk) [Investment & Origination Activity](index=11&type=section&id=Investment%20%26%20Origination%20Activity) Q1 2025 saw significant investment activity, primarily driven by strategic mergers and acquisitions, with a notable shift in net investment activity [Origination Activity](index=11&type=section&id=Origination%20Activity%20Detail) Q1 2025 was characterized by exceptionally high investment activity, primarily driven by the CSL III Merger and Credit Fund II Purchase Q1 2025 Investment Activity (in thousands) | (In thousands) | Q1 2025 | | :--- | :--- | | **New Investment Fundings** | | | First lien debt | $173,719 | | CSL III Merger | $487,879 | | Credit Fund II Purchase | $198,824 | | **Total New Fundings** | **$865,008** | | **Sales & Repayments** | **$(187,647)** | | **Net Investment Activity** | **$677,361** | | Net Activity (Ex-Merger/Fund) | $(9,342) | - The weighted average yield on new investment fundings was **9.8%**, while the yield on sales and repayments was higher at **10.9%**[20](index=20&type=chunk) - The weighted average yield on the total income-producing portfolio at amortized cost was **10.9%** at the end of Q1 2025, down from **11.7%** in Q4 2024[21](index=21&type=chunk) [Portfolio Overview](index=13&type=section&id=Portfolio%20Overview) CGBD's Q1 2025 portfolio is valued at $2.25 billion, defensively positioned with high senior secured and floating-rate exposure [Portfolio Highlights](index=13&type=section&id=Portfolio%20Highlights) As of March 31, 2025, CGBD's portfolio was valued at $2.25 billion, defensively positioned with high senior secured and floating-rate investments Key Portfolio Metrics | Metric | Value | | :--- | :--- | | Total Investments at Fair Value | $2,246 million | | Senior Secured Exposure | 94% | | Floating Rate Investments | 99.4% | | Weighted Average Yield | 10.9% | | Number of Portfolio Companies | 138 | | Non-accrual Investments (at FV) | 1.6% | - The asset mix is heavily weighted towards first-lien debt, which comprises **83%** of the portfolio, followed by second-lien debt (**6%**) and equity/investment funds (**11%**)[25](index=25&type=chunk) - The portfolio is diversified by industry, with the largest concentrations in **Healthcare & Pharmaceuticals (13%)**, **Software (12%)**, and **Consumer Services (9%)**[25](index=25&type=chunk) [Overview of Investment Funds](index=15&type=section&id=Overview%20of%20Investment%20Funds) The Credit Fund, a significant portion of CGBD's portfolio, is highly focused on senior secured debt and saw a consolidation of ownership in Q1 2025 Credit Fund Key Metrics | Credit Fund Metric | Value | | :--- | :--- | | Investments at Fair Value | $611 million | | CGBD Ownership | 50.0% | | % of CGBD Portfolio | 5.4% | | First Lien Investments | 99.9% | | Yield of Debt Investments | 10.2% | | Non-accrual | 0.9% | - In Q1 2025, CGBD acquired the remaining third-party interest in Credit Fund II, making it a **wholly-owned, consolidated entity**[31](index=31&type=chunk)[32](index=32&type=chunk) - The Credit Fund declared a **$62.5 million return of capital distribution** to its partners in Q1 2025 following a refinancing of its debt facility[31](index=31&type=chunk)[32](index=32&type=chunk) [Capital Structure & Liquidity](index=17&type=section&id=Capital%20Structure%20%26%20Liquidity) CGBD strengthened its capital structure and liquidity in Q1 2025 by increasing credit facility commitments and extending debt maturities [Funding and Capital Management](index=17&type=section&id=Funding%20and%20Capital%20Management%20Overview) As of March 31, 2025, CGBD enhanced its financial flexibility by increasing its primary Credit Facility commitment and extending its maturity Debt Facilities and Capital Structure | Facility | Commitment | Outstanding | Maturity | Pricing | | :--- | :--- | :--- | :--- | :--- | | Credit Facility | $935M | $288M | Mar 2030 | SOFR + 1.88% | | CSL III SPV Credit Facility | $250M | $206M | Sep 2030 | SOFR + 2.85% | | CLO 2015-IN | $380M | $380M | Jul 2036 | SOFR + 1.94% | | 2028 Senior Notes | $85M | $85M | Dec 2028 | SOFR + 3.14% (swapped) | | 2030 Senior Notes | $300M | $300M | Feb 2030 | SOFR + 3.23% (swapped) | | **Total / W.A.** | **$1,950M** | **$1,259M** | **6.8 years** | **6.50%** | - In Q1 2025, the Credit Facility was amended to increase total commitments to **$935 million** and extend the maturity date to **March 2030**, enhancing liquidity and extending the debt maturity profile[33](index=33&type=chunk)[34](index=34&type=chunk) [Net Asset Value (NAV) Analysis](index=19&type=section&id=Net%20Asset%20Value%20(NAV)%20Analysis) CGBD's NAV per share decreased to $16.63 in Q1 2025, primarily due to dividends and net realized/unrealized losses [NAV Per Share Bridge](index=19&type=section&id=Net%20Asset%20Value%20Per%20Share%20Bridge) CGBD's Net Asset Value (NAV) per share decreased from $16.80 to $16.63 in Q1 2025, primarily driven by dividends and net realized/unrealized losses NAV Per Share Bridge (Q1 2025) | NAV Bridge (Q1 2025) | Per Share Amount | | :--- | :--- | | **December 31, 2024 NAV** | **$16.80** | | Net Investment Income | +$0.40 | | Amortization of Premium/Discount | +$0.01 | | Dividend Declared | -$0.45 | | Net Realized/Unrealized Gain (Loss) | -$0.11 | | Other Adjustments | -$0.02 | | **March 31, 2025 NAV** | **$16.63** | NAV Per Share Bridge (Last Twelve Months ending Q1 2025) | NAV Bridge (LTM Q1 2025) | Per Share Amount | | :--- | :--- | | **March 31, 2024 NAV** | **$17.07** | | Net Investment Income | +$1.85 | | Dividend Declared | -$1.84 | | Net Realized/Unrealized Gain (Loss) | -$0.44 | | Other Adjustments | -$0.01 | | **March 31, 2025 NAV** | **$16.63** | [Portfolio Quality](index=21&type=section&id=Portfolio%20Quality) Portfolio credit quality saw a slight deterioration in Q1 2025, with an increase in non-accrual investments [Risk Rating Distribution](index=21&type=section&id=Risk%20Rating%20Distribution) The credit quality of the portfolio showed some deterioration in Q1 2025, with an increase in non-accrual investments, though most remain highly rated - As of March 31, 2025, non-accrual investments represented **1.6%** of total investments at fair value and **2.2%** at amortized cost. This is an increase from **0.6%** and **1.0%**, respectively, in the prior quarter[39](index=39&type=chunk) Internal Risk Rating Distribution | Internal Risk Rating | % of Fair Value (Q1 2025) | % of Fair Value (Q4 2024) | | :--- | :--- | :--- | | 1 (Above Expectations) | 0.0% | 0.0% | | 2 (As Expected) | 89.7% | 87.4% | | 3 (Below Expectations) | 8.5% | 12.0% | | 4 (Materially Below) | 1.8% | 0.5% | | 5 (Substantially Below) | -% | 0.1% | [Shareholder Information](index=23&type=section&id=Shareholder%20Information) CGBD maintains a strong dividend profile with a 9.6% annualized yield and consistent dividend coverage [Stock and Dividend Information](index=23&type=section&id=Stock%20and%20Dividend%20Information) CGBD maintains a strong dividend profile with a 9.6% annualized yield and consistent dividend coverage, supplemented by historical special dividends Key Shareholder Metrics | Metric | Value | | :--- | :--- | | Ticker | CGBD (NASDAQ) | | Annualized Dividend Yield | 9.6% | | Q1 2025 Dividend Coverage | 100% | | Spillover Income per Share | $0.85 | | ITD Share Repurchases | $158M | - The company has a consistent history of declaring dividends, with the base dividend increasing over time and supplemented by special dividends. For Q1 2025, the declared dividend was **$0.40 per share**[45](index=45&type=chunk) [Historical Net Asset Value Performance](index=25&type=section&id=Historical%20Net%20Asset%20Value%20Information) CGBD's NAV per share demonstrated resilience and growth over five years, outperforming the average BDC peer group Historical NAV Per Share Performance | NAV per Share Performance (Q4'19 - Q4'24) | Q4'19 | Q4'24 | Growth/Decline | | :--- | :--- | :--- | :--- | | CGBD | $16.56 | $16.80 | +1.4% | | BDC Peers (Average) | $16.52 | $15.63 | -7.1% | [Appendix](index=27&type=section&id=Appendix) The Appendix provides an overview of Carlyle's global investment firm, its Global Credit platform, and its direct lending strategy [Carlyle Firm & Platform Overview](index=29&type=section&id=Carlyle%20Firm%20%26%20Platform%20Overview) Carlyle is a major global investment firm with $441 billion in AUM, managing CGBD through its Global Credit platform with a defensive direct lending strategy Carlyle Firm Overview | Carlyle Firm Overview | | | :--- | :--- | | AUM | $441 bn | | Employees | 2,300+ | | Offices | 29 | - The Global Credit platform, which manages CGBD, has **$192 billion in AUM** and over **190 investment professionals**[57](index=57&type=chunk) - Carlyle's Direct Lending philosophy emphasizes a defensive approach, focusing on performing, non-cyclical companies with **EBITDA of $25 million or greater**, and targeting sustainable cash income from first-lien, secured, floating-rate debt[63](index=63&type=chunk) [Non-GAAP Measures](index=35&type=section&id=Non-GAAP%20Measures) The company utilizes non-GAAP financial measures like Adjusted NII to provide a clearer view of core operating performance by excluding non-recurring items - Non-GAAP measures are used to evaluate ongoing results without the effect of amortization from acquisition accounting (ASC 805) and other one-time or non-recurring income and expense events[66](index=66&type=chunk)[69](index=69&type=chunk) - For Q1 2025, adjustments were made for amortization related to assets acquired in the CSL III Merger and the Credit Fund II Purchase to reflect management's view of the economic yield on those assets[67](index=67&type=chunk) [Detailed Financial Statements](index=37&type=section&id=Detailed%20Financial%20Statements) The appendix includes detailed quarterly balance sheets and income statements for the last five quarters, offering granular insight into financial position and performance trends - Detailed quarterly balance sheets from Q1 2024 to Q1 2025 are provided, showing line-item details for assets, liabilities, and net assets[71](index=71&type=chunk)[72](index=72&type=chunk) - Detailed quarterly income statements from Q1 2024 to Q1 2025 are provided, breaking down investment income by source (interest, dividends, other) and detailing all expense categories[73](index=73&type=chunk)