Financial Performance - Net investment income was $0.47 per common share, consistent with the previous quarter[13] - Total investment income for Q4 2024 was $62.685 million, compared to $62.007 million in Q3 2024[14] - Total investment income for Q4 2023 was $62.69 million, compared to $58.26 million in Q2 2024, reflecting a growth of 7.5%[45] - Net investment income for Q4 2023 was $28.24 million, with a net investment income per common share of $0.56[45] Asset Valuation - NAV per share was $16.80 as of December 31, 2024, compared to $16.75 as of September 30, 2024[13] - Net Asset Value available to Common shares was $16.99 in Q4 2023, slightly down from $17.07 in Q1 2024[16] - CGBD's Net Asset Value (NAV) per share has increased over the past 5 years, while BDC peers experienced a decline of 6.0%[33] Portfolio and Investments - Total fair value of the portfolio was $1.8 billion with a weighted average yield of 11.7%[13] - Total investments at fair value increased to $1,841,881,000 in Q4 2023 from $1,726,050,000 in Q2 2024, reflecting a growth of 6.7%[16] - Total investments at fair value reached $1.84 billion in Q4 2023, up from $1.73 billion in Q2 2024[44] - The company reported a total of 189 investments across 135 portfolio companies, with an average exposure of 0.7% per company[19] - New investment fundings totaled $76,931,000 in Q4 2023, with first lien debt accounting for $75,004,000, representing 97.5% of total fundings[17] Liquidity and Leverage - Total liquidity as of December 31, 2024, was $565.7 million, an increase from $354.8 million as of September 30, 2024[13] - Net financial leverage increased to 1.01x as of December 31, 2024, within the target range of 1.0x to 1.25x[13] - The company’s leverage ratio was reported at 1.03x in Q4 2023, up from 0.96x in Q1 2024[16] Dividends - The company declared a base dividend of $0.40 plus a $0.05 supplemental dividend, equating to an annualized yield of 10.7% on NAV[13] - The annualized base dividend is $0.18, with a dividend yield of 10.7% and a coverage ratio of 118%[31] - Annualized dividend yield to CGBD was reported at 11.4% for the Middle Market Credit Fund[20] Non-Accrual Investments - Non-accrual investments represented 1.0% based on amortized cost and 0.65% based on fair value as of December 31, 2024[13] - Non-accrual investments represented 0.6% of total fair value, consistent with the previous period[29] Corporate Actions - The company is progressing on the previously announced merger with CSL III, with a stockholder meeting scheduled for March 26, 2025[13] - The company has a stock repurchase program approved on November 5, 2018, which continues through November 2025[32] Investment Strategy - Carlyle Global Credit has $192 billion in assets under management (AUM), with various credit strategies including liquid credit and private credit[38] - The company has a rigorous investment process targeting non-cyclical companies with EBITDA of $25 million or more[40] - Carlyle Direct Lending focuses on delivering sustainable current cash income from predominantly floating rate instruments[40]

Core Viewpoint - Carlyle Secured Lending, Inc. (CGBD) is well-positioned to continue its earnings-beat streak in the upcoming report, supported by a strong earnings history and positive analyst sentiment [1][3]. Earnings Performance - For the last reported quarter, Carlyle Secured Lending achieved earnings of $0.49 per share, surpassing the Zacks Consensus Estimate of $0.48 per share, resulting in a surprise of 2.08% [2]. - In the previous quarter, the company reported earnings of $0.51 per share against an expectation of $0.50 per share, delivering a surprise of 2% [2]. Analyst Estimates - Recent estimates for Carlyle Secured Lending have been trending upward, with a positive Earnings ESP (Expected Surprise Prediction) indicating a strong likelihood of an earnings beat [3][6]. - The current Earnings ESP for the company stands at +0.57%, reflecting increased analyst optimism regarding its earnings prospects [6]. Predictive Metrics - Stocks with a positive Earnings ESP and a Zacks Rank of 3 (Hold) or better have historically produced a positive surprise nearly 70% of the time, suggesting a high probability of beating consensus estimates [4]. - The Zacks Earnings ESP compares the Most Accurate Estimate to the Zacks Consensus Estimate, with the Most Accurate Estimate being more reflective of recent analyst revisions [5].

Core Viewpoint - Carlyle Secured Lending, Inc. will announce its financial results for Q4 and the full year of 2024 on February 26, 2025, with a news release prior on February 25, 2025 [1]. Company Overview - Carlyle Secured Lending, Inc. is a publicly traded business development company (BDC) listed on NASDAQ under the ticker CGBD, which began its investment activities in 2013 [3]. - The company specializes in providing directly originated financing solutions, focusing on senior secured lending to middle-market companies primarily in the United States [3]. - Carlyle Secured Lending is externally managed by Carlyle Global Credit Investment Management L.L.C., a registered investment adviser and wholly owned subsidiary of Carlyle [3]. Carlyle Group Overview - Carlyle is a global investment firm with expertise across three business segments: Global Private Equity, Global Credit, and Global Investment Solutions [4]. - As of September 30, 2024, Carlyle has $447 billion in assets under management [4]. - The firm employs over 2,300 people across 29 offices on four continents [4].

Financial Data and Key Metrics Changes - In Q3 2024, the company generated net investment income of $0.47 per share and adjusted net investment income of $0.49 per share, reflecting a stable credit performance and a higher base rate environment [8][14] - The net asset value (NAV) as of September 30 was $16.85 per share, showing a modest decline from the previous quarter [9] - Total investment income for the quarter was $56 million, slightly lower than the prior quarter due to a lower average portfolio balance and lower weighted average yields [13] Business Line Data and Key Metrics Changes - The company reported a significant year-over-year increase in originations during Q3, with a growing pipeline expected to remain strong into 2025 [10] - The portfolio consisted of 175 investments in 128 companies across more than 25 industries, with 94% of investments in senior secured loans [11] Market Data and Key Metrics Changes - The company noted that new issue spreads stabilized in Q3 despite increased competition and cross-market refinancings [10] - The median EBITDA across the core portfolio at quarter end was $85 million, indicating strong underlying performance [12] Company Strategy and Development Direction - The company is focused on maintaining a highly diversified portfolio while increasing origination activity, with a target leverage of 1.1 times at merger close [21][28] - The merger with Carlyle Secured Lending III is expected to close by the end of Q1 2025, which will enhance scale, liquidity, and operational efficiencies [22][23] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the ability to meet and exceed the $0.40 base dividend, although some contraction in earnings is expected due to lower base rates and tighter new issue spreads [16] - The overall credit quality remains stable, with non-accruals decreasing to 0.6% of total investments at fair value [18] Other Important Information - The company declared a total fourth quarter dividend of $0.45 per share, consisting of a base dividend of $0.40 and a supplemental dividend of $0.05 [9][15] - The company successfully issued $300 million of unsecured notes with a fixed rate of 6.75%, diversifying financing sources [20] Q&A Session Summary Question: Outlook on portfolio and balance sheet leverage - Management is optimistic about the pipeline and expects M&A activity to increase in Q4 and Q1 next year, with a current leverage of 0.9 times [27][28] Question: Repayment volume and origination dynamics - Management anticipates a reversal in repayment volume this quarter, with higher overall volume on the new deal side [31] Question: Trends in revenue growth and EBITDA - Management noted strong fundamentals with companies in the portfolio continuing to grow revenue and EBITDA, with growth rates stabilizing in the mid-single digits [36][40]

Financial Performance - Net investment income per share was $0.47[11] - Adjusted net investment income was $0.49 per common share[11] - NAV per share was $16.85 as of September 30, 2024, a slight decrease from the prior quarter's $16.95[11] - A base dividend of $0.40 plus a $0.05 supplemental dividend for 4Q24 was declared, equating to an annualized dividend yield of 10.7% on the 3Q24 NAV[11] Portfolio and Investment Activity - Total fair value of the portfolio was $1.7 billion across 128 portfolio companies with a weighted average yield of 11.9% as of September 30, 2024[11] - New investment fundings during the quarter were $143.4 million with a weighted average yield of 10.7%[11] - Total repayments and sales during the quarter were $171.2 million with a weighted average yield of 12.4%[11] - Non-accrual investments represented 1.2% of the total portfolio based on amortized cost and 0.6% based on fair value as of September 30, 2024, down from 2.8% and 1.8% respectively as of June 30, 2024[11] Liquidity and Capital Activity - $300 million 6.75% unsecured notes were issued in October, maturing in 2030, along with an interest rate swap to pay a floating interest of SOFR + 3.23%[11] - Net financial leverage decreased to 0.89x as of September 30, 2024, and statutory leverage decreased to 1.05x[11] - Total liquidity as of September 30, 2024, was $354.8 million in cash and undrawn debt capacity[11]

Financial Performance - Carlyle Secured Lending, Inc. (CGBD) reported quarterly earnings of $0.49 per share, exceeding the Zacks Consensus Estimate of $0.48 per share, but down from $0.52 per share a year ago, representing an earnings surprise of 2.08% [1] - The company posted revenues of $39.08 million for the quarter ended September 2024, missing the Zacks Consensus Estimate by 2.10%, and down from $42.28 million year-over-year [2] - Over the last four quarters, the company has surpassed consensus EPS estimates four times and topped consensus revenue estimates two times [2] Stock Performance - Carlyle Secured Lending shares have increased approximately 10.2% since the beginning of the year, while the S&P 500 has gained 19.8% [3] - The current consensus EPS estimate for the upcoming quarter is $0.48 on revenues of $40.94 million, and for the current fiscal year, it is $1.96 on revenues of $166.65 million [7] Industry Outlook - The Financial - SBIC & Commercial Industry, to which Carlyle Secured Lending belongs, is currently ranked in the bottom 21% of over 250 Zacks industries, indicating potential challenges ahead [8] - The performance of Carlyle Secured Lending's stock may be influenced by the overall outlook for the industry [8]

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 Carlyle Secured Lending, Inc. (Exact name of Registrant as specified in its charter) 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 September 30, 2024 OR o TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period to Commission File No. 814-00995 Maryland 80-0789789 (State or other jurisdiction of ...

| --- | --- | --- | --- | |----------------------------------------------------------------------------------|-------|-------|-------| | | | | | | | | | | | C A R L Y L E | | | | | Carlyle Secured Lending, Inc. Quarterly Earnings Presentation September 30, 2024 | | | | Disclaimer and Forward-Looking Statement This presentation (the "Presentation") has been prepared by Carlyle Secured Lending, Inc. (together with its consolidated subsidiaries, "Company") (NASDAQ: CGBD) and may only be used for informational ...

Core Viewpoint - The BDC market is experiencing heightened volatility due to increased corporate distress and the Federal Reserve's approach to interest rate cuts, which complicates the ability of BDCs to maintain attractive spreads [1][2] BDC Market Dynamics - The anticipated interest rate cuts have not yet led to significant corrections in the BDC sector, but future adjustments are expected as the effects of these cuts permeate through BDC structures [2] - There are early signs of weakening portfolio quality metrics among BDCs, making a focus on quality increasingly critical [2] Stronger BDCs - **Carlyle Secured Lending Inc. (CGBD)**: - Maintained strong total investment income and a high dividend coverage ratio of 128% despite a 25% increase in dividends since early 2022 [4] - Net investment income per share remained stable at $0.51, with a minor non-accrual base of 1.8% expected to decline to 1% in Q3 2024 [4] - Announced a merger with Carlyle Secured Lending III, which is expected to benefit shareholders [4] - **FS KKR Capital (FSK)**: - Total investment income increased by $5 million, with a decrease in interest expenses and management fees, resulting in a $0.02 per share increase [5] - EBITDA levels of underlying portfolio investments grew by approximately 12% year-over-year, with non-accruals declining to 1.8% of total portfolio fair value [5] - FSK trades at a ~17% discount to NAV, with leverage decreasing to 1.09x, below the sector average [5] Weaker BDCs - **Oaktree Specialty Lending (OCSL)**: - Experienced a negative total return of 15% since January 2024, with adjusted net investment income declining to $0.55 per share [6] - Non-accruals increased from 4.3% to 5.7% of the portfolio, leading to a distribution coverage of only 100% [6] - Leverage increased from 1.02x to 1.1x, indicating potential risks despite solid portfolio statistics [6] - **Horizon Technology Finance (HRZN)**: - Investment income decreased from $28 million to $26 million, with per share income dropping from $0.54 to $0.36 year-over-year [7] - The portfolio size has declined due to shallow M&A activity, with repayments exceeding new investments [7] - Debt to equity ratio remains high at 1.36x, indicating balance sheet concerns [7] Conclusion - The BDC market is facing challenges from rising non-accruals, shallow transaction activity, and impending interest rate cuts, necessitating a focus on high-quality and defensive BDCs to sustain distributions and support gradual growth [8]

Carlyle Secured Lending, Inc. (CGBD) announced a definitive agreement to acquire Carlyle Secured Lending III (CSL III) — a private business development company with a similar investment strategy and portfolio. After the closure of this stock-for-stock merger, CGBD's total assets will increase to $2.5 billion and net assets to more than $1.2 billion upon closing. CSL III's investment activities are managed by its investment adviser, CSL III Advisor, an affiliate of Carlyle Group (CG) . Given the substantial ...