GOLUB CAPITAL BDC, INC. EARNINGS PRESENTATION QUARTER ENDED MARCH 31, 2025 Confidential | for discussion purposes only Disclaimer Some of the statements in this presentation constitute forward-looking statements, which relate to future events or our future performance or financial condition. The forward-looking statements contained in this presentation involve risks and uncertainties, including statements as to: our future operating results; our business prospects and the prospects of our portfolio companie ...

Perspective: "Do not store up for yourselves treasures on earth, where moth and rust destroy, and where thieves break in and steal. But store up for yourselves treasures in heaven, where neither moth nor rust destroys, and where thieves do not break in or steal; for where your treasure is, there your heart will be also ... For what will it profit a man if he gains the whole world and forfeits his soul?" ~ Jesus (Matthew 6:19-21; 16:26) Learn more Samuel Smith has a diverse background that includes being lea ...

分组1 - Golub Capital BDC reported quarterly earnings of $0.39 per share, missing the Zacks Consensus Estimate of $0.41 per share, and down from $0.51 per share a year ago, representing an earnings surprise of -4.88% [1] - The company posted revenues of $213.89 million for the quarter ended March 2025, missing the Zacks Consensus Estimate by 4.43%, compared to year-ago revenues of $164.23 million [2] - Golub Capital BDC shares have declined approximately 5.5% since the beginning of the year, while the S&P 500 has decreased by 3.3% [3] 分组2 - The current consensus EPS estimate for the upcoming quarter is $0.41 on revenues of $222.97 million, and for the current fiscal year, it is $1.60 on revenues of $890.04 million [7] - The Zacks Industry Rank for Financial - SBIC & Commercial Industry is currently in the bottom 34% of over 250 Zacks industries, indicating potential underperformance compared to the top 50% of ranked industries [8]

Portfolio Overview - As of March 31, 2025, the total portfolio at fair value was $8,621.2 million, an increase from $8,235.4 million as of September 30, 2024[457]. - The company had debt and equity investments in 393 portfolio companies as of March 31, 2025, an increase from 381 companies as of September 30, 2024[459]. - As of March 31, 2025, the company had investments in 393 portfolio companies with a total fair value of $8.6 billion, up from $8.2 billion for 381 companies as of September 30, 2024[548]. - The portfolio median EBITDA for portfolio companies was $65.4 million as of March 31, 2025, compared to $63.7 million as of September 30, 2024[553]. Investment Performance - The weighted average annualized income yield for the three months ended March 31, 2025, was 10.5%, down from 10.9% for the previous quarter[460]. - The weighted average investment income yield for the six months ended March 31, 2025, was 11.0%, compared to 12.7% for the same period in the previous year[460]. - The total return based on average net asset value for the six months ended March 31, 2025, was 9.5%, compared to 13.2% for the same period in the previous year[460]. - Interest income for the three months ended March 31, 2025, decreased by $11.9 million to $188.15 million compared to $200.035 million for the three months ended December 31, 2024[481]. - Total investment income decreased by $6.8 million to $213.892 million for the three months ended March 31, 2025, compared to $220.7 million for the previous quarter[488]. - Investment income increased by $105.6 million to $434.592 million for the six months ended March 31, 2025, compared to $329 million for the same period in 2024[488]. Debt and Financing - The company amended its JPM Credit Facility on April 4, 2025, extending the maturity date to April 4, 2030, and allowing total commitments to increase to up to $3.0 billion[476]. - As of March 31, 2025, the company had outstanding debt under the JPM Credit Facility of $1,110.1 million, with remaining commitments and availability of $887.4 million[520]. - The company had outstanding debt under the 2024 Debt Securitization of $1,364.0 million as of March 31, 2025[524]. - Average debt outstanding increased by $64.4 million from $4.770 billion in Q4 2024 to $4.834 billion in Q1 2025, and by $1.667 billion from $3.147 billion in Q1 2024 to $4.814 billion in Q1 2025[494]. - The effective annualized average interest rate decreased from 6.2% in Q4 2024 to 5.9% in Q1 2025, while it increased from 5.6% in Q1 2024 to 6.0% in Q1 2025[495]. Income and Expenses - General and administrative expenses are expected to remain stable or decline as a percentage of total assets during periods of asset growth[464]. - Interest and other debt financing expenses decreased by $9.7 million from $76.998 million in Q4 2024 to $67.432 million in Q1 2025, primarily due to lower interest rates and refinancing benefits[494]. - The base management fee increased by $0.1 million from $21.581 million in Q4 2024 to $21.714 million in Q1 2025, driven by an increase in average adjusted gross assets[497]. - The Income Incentive Fee increased by $0.2 million from $18.058 million in Q4 2024 to $18.247 million in Q1 2025, but decreased by $0.4 million from $36.754 million in Q1 2024 to $36.305 million in Q1 2025 due to a reduction in fee rates[500]. - Professional fees, administrative service fees, and general administrative expenses increased by $0.1 million from Q4 2024 to Q1 2025, and by $2.9 million from Q1 2024 to Q1 2025[503]. Shareholder Distributions - A quarterly distribution of $0.39 per share was declared on May 2, 2025, payable on June 27, 2025[477]. - The company intends to make quarterly distributions to stockholders, but there are no assurances regarding the level or consistency of these distributions[559]. - The company has made and intends to continue making requisite distributions to stockholders to relieve it from U.S. federal income taxes[587]. Risk Management - The company is subject to financial market risks, including valuation risk and changes in interest rates[592]. - The fair value of investments is subject to fluctuation due to the lack of readily available market prices, which may result in significant differences if liquidated[593]. - The company may hedge against interest rate fluctuations using instruments such as interest rate swaps, futures, and options[597]. - The analysis of interest rate sensitivity does not account for changes in credit market conditions or the composition of the asset portfolio[595]. Acquisitions and Growth Strategy - The company completed the acquisition of GBDC 3 on June 3, 2024, resulting in the issuance of 92,115,308 shares of common stock to former stockholders of GBDC 3[474]. - The company completed acquisitions of GCIC and GBDC 3, impacting the fair value of assets and liabilities assumed, with purchase premiums recognized as unrealized depreciation[482]. - The company targets a GAAP debt-to-equity ratio between 0.85x to 1.25x, with a net GAAP debt-to-equity ratio of 1.16x as of March 31, 2025[542]. - The company plans to fund the growth of its investment portfolio through net proceeds from future securities offerings and borrowings, but cannot assure successful capital raising efforts[546]. Valuation and Fair Value - The fair value of the company's debt investments as a percentage of the outstanding principal value was 98.4%, up from 97.8% as of September 30, 2024[552]. - The fair value of investments can differ significantly from values that would have been used had a readily available market value existed[581]. - Approximately 50% of the valuations of debt and equity investments without readily available market quotations are subject to review by an independent valuation firm[578]. - The primary method for determining enterprise value uses a multiple analysis applied to the portfolio company's EBITDA[579]. Non-Accrual Loans - The company had loans in eight portfolio companies on non-accrual status, with non-accrual investments as a percentage of total investments at cost and fair value being 1.2% and 0.7%, respectively[551]. - The total fair value of non-accrual loans was $59.9 million as of March 31, 2025, down from $93.2 million as of September 30, 2024[586].

Group 1 - The Cash Flow Kingdom Income Portfolio aims to achieve an overall yield in the range of 7% to 10% by combining various income streams for a steady payout [1] - Golub Capital BDC (GBDC) is highlighted as a high-quality business development company with a current regular dividend yield of 11% [1] - The portfolio's price may fluctuate, but the income stream remains consistent, indicating a focus on stability in income generation [1] Group 2 - The Cash Flow Club, where the author contributes, focuses on company cash flows and access to capital, providing features like a personal income portfolio targeting a yield of over 6% [1] - The community offers resources such as a "Best Opportunities" List and coverage of sectors including energy midstream, commercial mREITs, BDCs, and shipping [1]

Financial Results Announcement - Golub Capital BDC, Inc. will release its financial results for the quarter ended March 31, 2025, on May 5, 2025, after market close[4] - The press release regarding the financial results is attached as Exhibit 99.1[6] Company Information - The company is registered under the trading symbol GBDC on The Nasdaq Global Select Market[2]

Group 1 - Golub Capital BDC (NASDAQ: GBDC) operates a first lien-strategy and supports its dividend with net investment income, indicating a strong financial foundation [1] - The company has a strong balance sheet quality, which is a positive indicator for investors [1] - The recent merger with Golub Capital BDC 3 has enhanced the firm's operational capabilities and overall performance [1]

Group 1 - The dividend pay-out ratio of Golub Capital BDC increased to 123% in 4Q24 due to the payment of a special dividend to distribute excess portfolio income along with a variable dividend [1]

Financial Data and Key Metrics Changes - GBDC reported adjusted net investment income (NII) per share of $0.39, corresponding to a return on equity of 10.1% [6][7] - Adjusted net income per share was $0.42, which included $0.03 of adjusted net realized and unrealized gains [7][8] - NAV per share decreased by $0.06 to $15.13, primarily due to distributions exceeding earnings [21][33] Business Line Data and Key Metrics Changes - Gross originations increased to $1.2 billion, with net funds increasing by $450 million, representing a 5.5% growth quarter-over-quarter [15][34] - The weighted average rate on new investments was 9.4%, while repayments had a weighted average rate of 11.3% [34] - Non-accrual investments decreased to 0.5% of total investments at fair value, the lowest level since September 2019 [41] Market Data and Key Metrics Changes - The lending environment has become more borrower-friendly, particularly in the large market segment, leading to spread compression and looser deal documentation [16][49] - Investments rated 4 and 5 increased to nearly 90% of the portfolio at fair value, indicating improved credit quality [19] Company Strategy and Development Direction - GBDC's strategy focuses on providing first lien senior secured loans to resilient middle market companies backed by strong private equity sponsors [4] - The company aims to maintain a conservative approach, primarily focusing on the core middle market despite increased competition [17][85] - GBDC executed a series of debt funding-related transactions to drive down its weighted average cost of debt, enhancing profitability [23][24] Management's Comments on Operating Environment and Future Outlook - Management noted a strong U.S. economy with solid revenue and EBITDA growth, but also highlighted elevated credit stress across the market [52][55] - The company remains cautious about potential impacts from tariffs and foreign exchange movements, emphasizing the resilience of its portfolio [62][66] - Management expects to see increased transaction volume and deal activity through 2025, driven by private equity sponsors [54] Other Important Information - GBDC was upgraded by Moody's to a Baa2 rating with a stable outlook, enhancing its ability to issue low-cost unsecured debt [24][46] - The company ended the quarter with approximately $1.1 billion of liquidity from unrestricted cash and undrawn commitments [47] Q&A Session Summary Question: How will the portfolio respond to current economic changes? - Management indicated that the portfolio is relatively insulated from foreign exchange and tariff movements due to its focus on U.S. borrowers and service companies [62][66] Question: What is the expected loss rate in the direct lending asset class? - Management noted that while credit stress is evident in the broadly syndicated market, it is less pronounced in private credit, with a focus on the core middle market to mitigate risks [74][78] Question: How is GBDC responding to increased competition? - Management stated that GBDC is not changing its strategy in response to competition but is focused on building competitive advantages in the core middle market [85][86] Question: What are the potential cost savings from recent funding initiatives? - Management explained that the current weighted average cost of debt is expected to decrease significantly as the benefits from recent funding initiatives take full effect [94][95] Question: Will there be significant portfolio churn due to increased M&A activity? - Management anticipates that higher M&A activity will lead to both increased originations and repayments, making the period of higher portfolio turnover manageable [104][105]

Financial Performance - Adjusted net investment income per share was $0.39, resulting in an Adjusted NII ROE of 10.1%[8] - Adjusted earnings per share reached $0.42, translating to an Adjusted ROE of 11.0%[8] - A quarterly base distribution of $0.39 per share was declared for FY 2025 Q1, with a strong coverage ratio of 103%[8] - Total announced distributions amounted to $0.39 per share, yielding a 10.3% dividend based on the December 31, 2024 NAV[8] Portfolio and Investment Activities - The investment portfolio expanded to $8.7 billion at fair value, with new investment commitments totaling $1.2 billion, of which $750.1 million were funded at close[8] - Net funds increased by $449.8 million, representing a 5.5% growth in portfolio size quarter-over-quarter[8] - Internal performance ratings improved, with nearly 90% of the portfolio at fair value rated '4' or '5'[8] - Non-accrual investments decreased to 0.5% of total investments at fair value following the restructuring of three portfolio companies[8] Balance Sheet and Liquidity - Net asset value stood at $15.13 per share, a slight decrease of $0.06 per share from the previous quarter[8] - Total available liquidity reached $1.1 billion[8] - GAAP debt-to-equity ratio, net increased to 1.19x[8]