UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q ý Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 For the Quarterly Period Ended March 31, 2023 o Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 | Commission File Number | Exact name of registrant as specified in its charter, address of principal executive offices, telephone numbers and states or other jurisdictions of incorporation or organizati ...

Financial Performance & Dividends - The current annualized dividend yield is 10%[1] - Since IPO, approximately $1 billion in dividends have been paid [5] - Q4 2022 adjusted net investment income (NII) was $0.35 per share, covering the $0.32 per share dividend [81] - A supplemental dividend program will commence in Q1 2023, with an expected dividend of $0.02 to $0.03 per share [53, 96] - Regular dividend is $0.32 per share for Q1 2023 [53, 81] Portfolio & Credit Quality - As of Q4 2022, 91.5% of the portfolio is rated "Green"[8, 103] - The annual net realized loss rate is 6 bps of $9.9 billion total investments since inception [5] - Top 15 portfolio companies represent $1250.5 million, or 38.6%, of consolidated investments [48] - First lien debt accounts for 87% of Q4 2022 originations [20] Market & Strategy - New Mountain employees are the largest shareholder group, owning 11%+ of shares outstanding [5, 81] - The company focuses on investing in strong businesses in acyclical sectors [5]

New Mountain Finance Corporation (NASDAQ:NMFC) Q4 2022 Earnings Conference Call February 28, 2023 10:00 AM ET Company Participants John Kline - President and Chief Executive Officer Steve Klinsky - Chairman, NMFC and Chief Executive Officer, New Mountain Capital Robert Hamwee - Vice Chairman Shiraz Kajee - Chief Financial Officer Conference Call Participants Ryan Lynch - KBW Derek Hewett - Bank of America Erik Zwick - Hovde Group Bryce Rowe - B. Riley Operator Good morning and welcome to the New Mountain Fi ...

Part I [Business](index=4&type=section&id=Item%201.%20Business) NMFC is a BDC investing in U.S. middle-market debt, managing a $3.22 billion portfolio focused on defensive growth companies - NMFC is a closed-end, non-diversified management investment company regulated as a **BDC** and qualifying as a **RIC** for tax purposes[12](index=12&type=chunk) - The company's investment objective is to generate **current income and capital appreciation** by sourcing and originating **debt securities**, with a focus on **U.S. middle-market defensive growth companies**[19](index=19&type=chunk)[20](index=20&type=chunk) Portfolio Summary (as of December 31, 2022) | Metric | Value | | :--- | :--- | | **Portfolio Fair Value** | $3,221.2 million | | **Number of Portfolio Companies** | 107 | | **Weighted Average YTM at Cost** | 11.3% | | **Weighted Average YTM at Cost for Investments** | 10.0% | Portfolio Composition by Investment Type (as of December 31, 2022) | Investment Type | Percentage of Portfolio (Fair Value) | | :--- | :--- | | First Lien Loans | 54.5% | | Second Lien Loans | 17.4% | | Subordinated Debt | 2.4% | | Equity and Other | 25.7% | Top 5 Industry Concentrations (as of December 31, 2022) | Industry | Percentage of Portfolio (Fair Value) | | :--- | :--- | | Software | 26.7% | | Business Services | 17.7% | | Healthcare | 16.3% | | Investment Fund (Joint Ventures) | 7.5% | | Education | 7.1% | [Risk Factors](index=27&type=section&id=Item%201A.%20Risk%20Factors) The company faces significant business, operational, investment, and securities risks, including market volatility and concentration - The company operates in a period of **capital markets disruption and economic uncertainty**, which could impair its ability to secure debt financing, increase funding costs, and negatively impact the fair value of its investments[125](index=125&type=chunk)[126](index=126&type=chunk)[128](index=128&type=chunk) - The business is **highly dependent on the key investment personnel** of the Investment Adviser, whose departure could significantly harm the company's ability to achieve its investment objective[161](index=161&type=chunk)[162](index=162&type=chunk) - The use of **leverage magnifies the potential for both gain and loss**, with approximately **$2.0 billion in total debt outstanding** as of December 31, 2022[176](index=176&type=chunk)[178](index=178&type=chunk)[179](index=179&type=chunk) - The company's portfolio may be **concentrated in a limited number of industries**, subjecting it to significant loss if there is a downturn in those particular sectors[270](index=270&type=chunk)[271](index=271&type=chunk) - The **transition from LIBOR to alternative reference rates** like SOFR creates uncertainty and could adversely affect the value of the company's floating-rate debt securities and reduce net investment income[305](index=305&type=chunk)[306](index=306&type=chunk)[310](index=310&type=chunk) - Shares of the company's common stock have **traded at a discount to Net Asset Value (NAV)** and may do so in the future, which could impair the ability to raise additional equity capital[317](index=317&type=chunk) [Unresolved Staff Comments](index=62&type=section&id=Item%201B.%20Unresolved%20Staff%20Comments) The company reports no unresolved staff comments from the SEC - **None**[328](index=328&type=chunk) [Properties](index=62&type=section&id=Item%202.%20Properties) The company does not own any material real estate or physical properties, with offices provided by the Administrator - The company **does not own any real estate or other physical properties** material to its operations, with office space provided through its Administration Agreement[329](index=329&type=chunk) [Legal Proceedings](index=62&type=section&id=Item%203.%20Legal%20Proceedings) As of December 31, 2022, the company and its affiliates are not subject to any material pending legal proceedings - The company is **not currently subject to any material pending legal proceedings**[330](index=330&type=chunk) [Mine Safety Disclosures](index=62&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) This item is not applicable to the company's business - **Not applicable**[331](index=331&type=chunk) Part II [Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities](index=63&type=section&id=Item%205.%20Market%20for%20Registrant%27s%20Common%20Equity%2C%20Related%20Stockholder%20Matters%20and%20Issuer%20Purchases%20of%20Equity%20Securities) NMFC common stock trades on NASDAQ, supported by a dividend reinvestment plan and a $50 million stock repurchase program Quarterly Stock Performance and Distributions (2022) | Quarter | NAV Per Share ($) | High Closing Price ($) | Low Closing Price ($) | Declared Distributions Per Share ($) | | :--- | :--- | :--- | :--- | :--- | | **Q4 2022** | $13.02 | $12.80 | $11.40 | $0.32 | | **Q3 2022** | $13.20 | $13.50 | $11.26 | $0.30 | | **Q2 2022** | $13.42 | $13.91 | $11.20 | $0.30 | | **Q1 2022** | $13.56 | $13.85 | $12.94 | $0.30 | - The company maintains an **opt out dividend reinvestment plan**, where stockholder cash distributions are automatically reinvested in additional shares unless they elect to receive cash[340](index=340&type=chunk) - A **$50.0 million stock repurchase program** was extended until December 31, 2023, though **no shares were repurchased** under this program during the year ended December 31, 2022[348](index=348&type=chunk) [Reserved](index=74&type=section&id=Item%206.%20Reserved) This item is reserved and contains no information [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=75&type=section&id=Item%207.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) In 2022, investment income increased to $294.6 million, but a net loss from investment activities decreased NAV per share Results of Operations Comparison (in thousands) | Metric | 2022 (in thousands) | 2021 (in thousands) | | :--- | :--- | :--- | | **Total Investment Income** | $294,630 | $270,959 | | **Net Expenses after Taxes** | $175,026 | $152,119 | | **Net Investment Income** | $119,604 | $118,840 | | **Net Realized/Unrealized (Losses) Gains** | $(45,076) | $88,342 | - The increase in total investment income was primarily due to **higher SOFR and LIBOR rates** on larger invested balances, while the increase in net operating expenses was driven by **higher interest rates on floating-rate borrowings** and new debt issuances[466](index=466&type=chunk)[468](index=468&type=chunk) - The **net loss from investment activities** in 2022 was primarily driven by **unrealized depreciation** on investments in NM CLFX LP, Ansira, National HME, and TVG-Edmentum Holdings, LLC[469](index=469&type=chunk) Liquidity and Capital Resources (as of Dec 31, 2022) | Metric | Value | | :--- | :--- | | **Cash and Cash Equivalents** | $71.2 million | | **Total Borrowings Outstanding** | $1,997.9 million | | **Asset Coverage Ratio** | 177.42% | | **Unfunded Commitments** | $224.1 million | - In 2022, the company sold 2,950,300 shares of common stock under its at-the-market (ATM) offering agreement, raising net proceeds of approximately **$40.0 million**[476](index=476&type=chunk) [Quantitative and Qualitative Disclosures About Market Risk](index=101&type=section&id=Item%207A.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) The company is primarily exposed to interest rate risk due to its floating-rate investments and borrowings, with sensitivity analysis indicating increased net interest income from rate hikes - The company's primary market risk is **interest rate fluctuation**, as approximately **86.7% of its investments** at fair value are floating-rate, while its credit facilities are also subject to floating rates[546](index=546&type=chunk) Interest Rate Sensitivity Analysis (as of Dec 31, 2022) | Change in Interest Rates (Basis Points) | Estimated Percentage Change in Net Interest Income (%) | | :--- | :--- | | -25 | (2.08)% | | +100 | 8.34% | | +200 | 16.68% | | +300 | 25.02% | [Financial Statements and Supplementary Data](index=102&type=section&id=Item%208.%20Financial%20Statements%20and%20Supplementary%20Data) This section presents the company's audited consolidated financial statements, including the independent auditor's report - The independent registered public accounting firm, Deloitte & Touche LLP, issued an **unqualified opinion** on the consolidated financial statements and the company's internal control over financial reporting as of December 31, 2022[553](index=553&type=chunk)[554](index=554&type=chunk) Consolidated Balance Sheet Highlights (in thousands) | Account | Dec 31, 2022 (in thousands) | Dec 31, 2021 (in thousands) | | :--- | :--- | :--- | | **Total Investments at Fair Value** | $3,221,247 | $3,174,364 | | **Total Assets** | $3,354,927 | $3,295,812 | | **Net Borrowings** | $1,980,661 | $1,907,188 | | **Total Liabilities** | $2,028,736 | $1,953,200 | | **Total Net Assets** | $1,326,191 | $1,342,612 | | **Net Asset Value Per Share** | $13.02 | $13.49 | Financial Highlights Per Share | Metric (Year Ended Dec 31) | 2022 ($) | 2021 ($) | | :--- | :--- | :--- | | **Net Asset Value, Beginning** | $13.49 | $12.62 | | **Net Investment Income** | $1.18 | $1.21 | | **Net Realized/Unrealized (Losses) Gains** | $(0.43) | $0.86 | | **Distributions Declared** | $(1.22) | $(1.20) | | **Net Asset Value, End** | $13.02 | $13.49 | [Changes in and Disagreements with Accountants on Accounting and Financial Disclosure](index=217&type=section&id=Item%209.%20Changes%20in%20and%20Disagreements%20with%20Accountants%20on%20Accounting%20and%20Financial%20Disclosure) The company reports no changes in or disagreements with its accountants on accounting and financial disclosure - **None**[984](index=984&type=chunk) [Controls and Procedures](index=217&type=section&id=Item%209A.%20Controls%20and%20Procedures) Management concluded that disclosure controls and internal control over financial reporting were effective as of December 31, 2022, with an unqualified auditor opinion - Management concluded that the company's disclosure controls and procedures were **effective** as of December 31, 2022[985](index=985&type=chunk) - Management determined that the company's internal control over financial reporting was **effective** as of December 31, 2022, based on the COSO 2013 framework[987](index=987&type=chunk) - **No changes in internal control over financial reporting occurred** during the fourth quarter of 2022 that materially affected, or are reasonably likely to materially affect, internal controls[997](index=997&type=chunk) [Other Information](index=219&type=section&id=Item%209B.%20Other%20Information) The company reports no other information for this item - **None**[998](index=998&type=chunk) [Disclosure Regarding Foreign Jurisdictions that Prevent Inspections](index=219&type=section&id=Item%209C.%20Disclosure%20Regarding%20Foreign%20Jurisdictions%20that%20Prevent%20Inspections) This item is not applicable to the company - **Not Applicable**[999](index=999&type=chunk) Part III [Directors, Executive Officers, Corporate Governance, Executive Compensation, Security Ownership, and Principal Accountant Fees](index=220&type=section&id=Items%2010%2C%2011%2C%2012%2C%2013%20and%2014) Information for Items 10-14, including governance, compensation, and ownership, is incorporated by reference from the 2023 Proxy Statement - Information for Part III (Items 10-14) is **incorporated by reference** from the Registrant's Proxy Statement for its 2023 Annual Meeting of Stockholders[1003](index=1003&type=chunk) Part IV [Exhibits and Financial Statement Schedules](index=221&type=section&id=Item%2015.%20Exhibits%20and%20Financial%20Statement%20Schedules) This section lists all financial statements and exhibits filed with the report, with no separate financial schedules - This section lists **all financial statements** included in Item 8 and **all exhibits** filed with the 10-K, such as the Certificate of Incorporation, Bylaws, Indentures, and various credit and management agreements[1011](index=1011&type=chunk)[1012](index=1012&type=chunk) - **No financial statement schedules are filed** because the required information is either not applicable or has been presented within the consolidated financial statements[1020](index=1020&type=chunk) [Form 10-K Summary](index=228&type=section&id=Item%2016.%20Form%2010-K%20Summary) The company reports no summary for this item - **None**[1021](index=1021&type=chunk)

Financial Data and Key Metrics Changes - Net investment income for Q3 was $0.32 per share, exceeding the $0.30 dividend per share paid on September 30 [8] - Net asset value decreased by $0.22 or 1.6% to $13.20 per share, despite rising interest rates [9][52] - Total investment income increased to $78.1 million, a $5.3 million increase from the prior quarter [55] - Quarterly net investment income was $32.5 million, resulting in a coverage of the dividend [57] Business Line Data and Key Metrics Changes - The portfolio had over $3.2 billion in investments at fair value, with total assets of $3.3 billion and total liabilities of $2 billion [51] - The average yield of the portfolio increased from 10.3% in Q2 to 11.3% in Q3, benefiting from the rising LIBOR curve [45] - The company originated almost $125 million in Q3 in core defensive growth verticals, including software and business services [41] Market Data and Key Metrics Changes - The overall investing environment remains challenging due to higher interest rates and inflation, but corporate direct lending is resilient [25] - The direct lending market continues to gain share from syndicated loans and high-yield bonds, offering price clarity and capital certainty [28] - The weighted average EBITDA of borrowers has increased to over $130 million, indicating stronger financial health [48] Company Strategy and Development Direction - The company focuses on lending to defensive growth businesses, which are less sensitive to economic cycles [17] - The strategy includes avoiding sectors with high volatility and cyclicality, concentrating on acyclical growth sectors [17][19] - The management plans to maintain dividend protection through waiving incentive fees if necessary [11] Management Comments on Operating Environment and Future Outlook - Management expressed optimism about future earnings potential due to the rise in interest rates, which is expected to positively impact quarterly earnings [11][29] - The company remains focused on maintaining high credit quality and is confident in the resilience of its portfolio amid rising rates [75] - Management highlighted the importance of the growth profile of underlying portfolio companies, which provides a cushion against rising rates [73] Other Important Information - The company has never experienced a bankruptcy or missed an interest payment since its inception [10] - The management team has been strengthened with key promotions, including John Kline becoming CEO effective January 1, 2023 [14] Q&A Session Summary Question: Future dividend coverage and strategy - The company intends to operate with a material coverage to the dividend, especially with rising rates [65] Question: Changes in terms and conditions for new originations - The company has not seen significant changes in interest rate floors for new transactions despite higher spreads [66] Question: Impact of rising rates on interest coverage - Management believes the portfolio can maintain adequate interest coverage even with rising rates, citing growth in underlying companies [75] Question: Current trends in portfolio growth - The company reports strong top-line growth trends, with some margin pressure but overall positive performance [80] Question: Software multiples and their impact - The company noted that while public software multiples have compressed, their lending positions remain secure with favorable loan-to-value ratios [84]

| --- | --- | |-------|-------| | | | | | | Important Notices and Safe Harbor Statement This presentation contains forward looking statements, which are not guarantees of future performance, conditions or results, and involve substantial risks and uncertainties, including the impact of COVID-19, the current conflict between Russia and Ukraine, and related changes in base interest rates and significant volatility on our business, portfolio companies, our industry, and the global economy. All forward-looking ...

[PART I. FINANCIAL INFORMATION](index=3&type=section&id=PART%20I.%20FINANCIAL%20INFORMATION) [Item 1. Financial Statements](index=3&type=section&id=Item%201.%20Financial%20Statements) This section presents the unaudited consolidated financial statements for New Mountain Finance Corporation as of September 30, 2022, and for the three and nine months then ended. It includes the Consolidated Statements of Assets and Liabilities, Operations, Changes in Net Assets, Cash Flows, a detailed Consolidated Schedule of Investments, and the accompanying Notes to the Financial Statements [Consolidated Statements of Assets and Liabilities](index=3&type=section&id=Consolidated%20Statements%20of%20Assets%20and%20Liabilities) As of September 30, 2022, total assets were approximately $3.35 billion, a slight increase from $3.30 billion at year-end 2021. Total net assets increased marginally to $1.345 billion from $1.343 billion. However, Net Asset Value (NAV) per share decreased to $13.20 from $13.49 at the end of 2021, primarily due to an increase in shares outstanding Consolidated Statements of Assets and Liabilities Highlights (in thousands, except per share data) | Metric | September 30, 2022 | December 31, 2021 | | :--- | :--- | :--- | | **Total investments at fair value** | **$3,234,433** | **$3,174,364** | | Total assets | $3,347,993 | $3,295,812 | | Net borrowings | $1,964,731 | $1,907,188 | | Total liabilities | $2,002,895 | $1,953,200 | | **Total net assets** | **$1,345,098** | **$1,342,612** | | Shares outstanding | 100,937,026 | 97,907,441 | | **Net asset value per share** | **$13.20** | **$13.49** | [Consolidated Statements of Operations](index=4&type=section&id=Consolidated%20Statements%20of%20Operations) For the third quarter of 2022, total investment income rose to $78.4 million from $68.5 million year-over-year, driven by higher interest income. However, a significant net unrealized depreciation on investments led to a net increase in net assets of only $7.7 million, compared to $21.8 million in Q3 2021. Diluted EPS for the quarter was $0.08, down from $0.22 in the prior-year period Consolidated Statements of Operations Summary (in thousands, except per share data) | Metric | Three Months Ended Sep 30, 2022 | Three Months Ended Sep 30, 2021 | Nine Months Ended Sep 30, 2022 | Nine Months Ended Sep 30, 2021 | | :--- | :--- | :--- | :--- | :--- | | **Total investment income** | **$78,449** | **$68,474** | **$220,522** | **$202,743** | | Net expenses | $45,653 | $37,837 | $126,106 | $113,899 | | **Net investment income** | **$32,809** | **$30,645** | **$94,421** | **$88,829** | | Net realized and unrealized (losses) gains | ($25,295) | ($7,740) | ($34,720) | $65,109 | | **Net increase in net assets (NMFC)** | **$7,705** | **$21,847** | **$59,851** | **$149,149** | | Basic earnings per share | $0.08 | $0.23 | $0.60 | $1.54 | | Diluted earnings per share | $0.08 | $0.22 | $0.59 | $1.42 | [Consolidated Statements of Changes in Net Assets](index=5&type=section&id=Consolidated%20Statements%20of%20Changes%20in%20Net%20Assets) For the nine months ended September 30, 2022, net assets increased by $10.7 million, resulting from a $59.9 million increase from operations offset by a $49.1 million net decrease from capital transactions, primarily distributions to stockholders, contrasting with a $63.0 million increase in 2021 Changes in Net Assets (Nine Months Ended, in thousands) | Description | September 30, 2022 | September 30, 2021 | | :--- | :--- | :--- | | Net assets at beginning of period | $1,321,245 | $1,221,875 | | Net increase in net assets from operations | $59,851 | $149,149 | | Net proceeds from shares sold | $40,006 | $0 | | Distributions declared to stockholders | ($90,085) | ($87,168) | | **Net assets at end of period** | **$1,331,955** | **$1,284,905** | [Consolidated Statements of Cash Flows](index=6&type=section&id=Consolidated%20Statements%20of%20Cash%20Flows) For the nine months ended September 30, 2022, net cash used in operating activities was $8.8 million, a significant shift from the $84.7 million provided in the prior-year period, primarily due to changes in unrealized depreciation and investment activities, leading to an overall $9.2 million decrease in cash and cash equivalents Consolidated Statements of Cash Flows (Nine Months Ended, in thousands) | Cash Flow Activity | September 30, 2022 | September 30, 2021 | | :--- | :--- | :--- | | Net cash (used in) provided by operating activities | ($8,849) | $84,690 | | Net cash provided by (used in) financing activities | $45 | ($80,405) | | **Net (decrease) increase in cash and cash equivalents** | **($8,804)** | **$4,285** | | Cash and cash equivalents at beginning of period | $58,077 | $78,966 | | **Cash and cash equivalents at end of period** | **$48,919** | **$83,357** | [Consolidated Schedule of Investments](index=7&type=section&id=Consolidated%20Schedule%20of%20Investments) As of September 30, 2022, the company's investment portfolio had a total fair value of $3.23 billion, heavily weighted towards floating-rate, first-lien debt, with top industry concentrations in Software (27.4%), Business Services (15.3%), and Healthcare Services (14.9%), diversified across 107 companies - Total investments at fair value were **$3,234.4 million** as of September 30, 2022, with a cost basis of $3,258.9 million[75](index=75&type=chunk) Portfolio Composition by Investment Type (September 30, 2022) | Investment Type | Percent of Total Investments at Fair Value | | :--- | :--- | | First lien | 54.73% | | Second lien | 17.73% | | Subordinated | 2.28% | | Equity and other | 25.26% | Portfolio Composition by Industry Type (Top 5) (September 30, 2022) | Industry Type | Percent of Total Investments at Fair Value | | :--- | :--- | | Software | 27.38% | | Business Services | 15.30% | | Healthcare Services | 14.90% | | Investment Funds | 7.80% | | Education | 7.66% | Portfolio Composition by Interest Rate Type (September 30, 2022) | Interest Rate Type | Percent of Total Investments at Fair Value | | :--- | :--- | | Floating rates | 87.64% | | Fixed rates | 12.36% | [Notes to the Consolidated Financial Statements](index=60&type=section&id=Notes%20to%20the%20Consolidated%20Financial%20Statements) This section provides detailed explanations of the accounting policies and methodologies used to prepare the financial statements, covering business purpose, investment valuation, specific investments, borrowings, related-party transactions, commitments, and subsequent events - The company operates as a Business Development Company (BDC) and has elected to be treated as a Regulated Investment Company (RIC) for tax purposes[160](index=160&type=chunk) - The Board of Directors is ultimately responsible for determining the fair value of portfolio investments quarterly, using a three-level hierarchy (Level I, II, III) for inputs[169](index=169&type=chunk) - As of September 30, 2022, the company had unfunded commitments of **$97.9 million** on revolving credit facilities and **$156.5 million** in other future funding commitments[217](index=217&type=chunk)[364](index=364&type=chunk) - Subsequent to the quarter end, the company issued **$200 million** of 7.50% convertible notes due 2025, launched a tender offer for its existing 2018 convertible notes, and announced a CEO transition effective January 1, 2023[387](index=387&type=chunk)[389](index=389&type=chunk)[390](index=390&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=109&type=section&id=Item%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses the company's financial condition and results of operations, highlighting increased total investment income driven by higher interest rates and larger invested balances, portfolio performance including a detailed risk rating system, liquidity, capital resources, borrowing facilities, and the impact of COVID-19 and rising interest rates - The company's investment objective is to generate current income and capital appreciation by sourcing and originating debt securities, with a primary focus on defensive growth companies[404](index=404&type=chunk)[405](index=405&type=chunk) - As of September 30, 2022, the portfolio's weighted average yield to maturity at cost for income-producing investments was approximately **11.3%**[406](index=406&type=chunk) - The company utilizes a four-tier risk rating system (Red, Orange, Yellow, Green). As of September 30, 2022, **93.0%** of the portfolio by fair value was rated Green, indicating performance is in-line with or above expectations[461](index=461&type=chunk) Portfolio Risk Rating Summary (As of September 30, 2022) | Risk Rating | Cost (in millions) | Percent of Cost | Fair Value (in millions) | Percent of Fair Value | | :--- | :--- | :--- | :--- | :--- | | Red | $95.6 | 2.9% | $30.7 | 0.9% | | Orange | $46.0 | 1.4% | $32.9 | 1.0% | | Yellow | $195.1 | 5.9% | $166.5 | 5.1% | | Green | $2,952.3 | 89.8% | $3,023.7 | 93.0% | [Quantitative and Qualitative Disclosures About Market Risk](index=132&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) The company is subject to market risk, primarily from interest rate fluctuations, as its net investment income is affected by the spread between the rates on its investments and borrowings. As of September 30, 2022, approximately 85.6% of its investments at fair value were floating-rate. A sensitivity analysis indicates that a 100 basis point increase in interest rates would increase net interest income by an estimated 6.31% Interest Rate Sensitivity Analysis | Change in Interest Rates | Estimated Percentage Change in Interest Income Net of Interest Expense | | :--- | :--- | | -25 Basis Points | (1.58)% | | +100 Basis Points | 6.31% | | +200 Basis Points | 12.68% | | +300 Basis Points | 19.04% | [Controls and Procedures](index=133&type=section&id=Item%204.%20Controls%20and%20Procedures) Management, including the CEO and CFO, evaluated the company's disclosure controls and procedures as of September 30, 2022, and concluded they were effective, with no material changes to internal controls over financial reporting identified during the quarter - The Chief Executive Officer and Chief Financial Officer concluded that the company's disclosure controls and procedures were effective as of September 30, 2022[558](index=558&type=chunk) - No changes in internal control over financial reporting occurred during the quarter that materially affected, or are reasonably likely to materially affect, internal controls[559](index=559&type=chunk) [PART II. OTHER INFORMATION](index=134&type=section&id=PART%20II.%20OTHER%20INFORMATION) [Legal Proceedings](index=134&type=section&id=Item%201.%20Legal%20Proceedings) As of September 30, 2022, the company and its subsidiaries are not subject to any material pending legal proceedings outside the normal course of business - The Company is not currently subject to any material pending legal proceedings[563](index=563&type=chunk) [Risk Factors](index=134&type=section&id=Item%201A.%20Risk%20Factors) There have been no material changes to the risk factors previously disclosed in the company's Annual Report on Form 10-K for the year ended December 31, 2021 - No material changes to the risk factors disclosed in the Annual Report on Form 10-K for the year ended December 31, 2021, were reported for the nine months ended September 30, 2022[564](index=564&type=chunk) [Unregistered Sales of Equity Securities and Use of Proceeds](index=135&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) The company did not engage in any unregistered sales of equity securities during the third quarter of 2022, and no shares were repurchased under its stock repurchase program during the nine months ended September 30, 2022 - The company did not engage in unregistered sales of its equity securities during the three months ended September 30, 2022[566](index=566&type=chunk) - The company's stock repurchase program, authorized for up to **$50 million**, was extended until December 31, 2022. No shares were repurchased under this program during the nine months ended September 30, 2022[569](index=569&type=chunk) [Defaults Upon Senior Securities](index=135&type=section&id=Item%203.%20Defaults%20Upon%20Senior%20Securities) No defaults upon senior securities were reported for the period - None[570](index=570&type=chunk) [Mine Safety Disclosures](index=135&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) This section is not applicable to the company - Not applicable[571](index=571&type=chunk) [Other Information](index=135&type=section&id=Item%205.%20Other%20Information) No other information was reported for the period - None[572](index=572&type=chunk) [Exhibits](index=136&type=section&id=Item%206.%20Exhibits) This section lists the exhibits filed as part of the quarterly report, including certifications from the CEO and CFO as required by the Sarbanes-Oxley Act

NEW MOUNTAIN FINANCE | --- | --- | |----------------------------------------------|-------| | | | | | | | Earnings Presentation Q2 2022 August 9, 2022 | | Important Notices and Safe Harbor Statement This presentation contains forward looking statements, which are not guarantees of future performance, conditions or results, and involve substantial risks and uncertainties, including the impact of COVID-19, the current conflict between Russia and Ukraine, and related changes in base interest rates and signific ...

New Mountain Finance (NASDAQ:NMFC) Q2 2022 Earnings Conference Call August 9, 2022 10:00 AM ET Corporate Participants Robert Hamwee - Chief Executive Officer Shiraz Kajee - Chief Financial Officer Steve Klinsky - Chairman & Chief Executive Officer, New Mountain Capital John Kline - President Laura Holson - Chief Operating Officer Conference Call Participants Jordan Wathen - Wells Fargo Ryan Lynch - KBW Operator Good morning. And welcome to today's New Mountain Finance Corporation Second Quarter 2022 Earning ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q ý Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 For the Quarterly Period Ended June 30, 2022 o Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 | Commission File Number | Exact name of registrant as specified in its charter, address of principal executive offices, telephone numbers and states or other jurisdictions of incorporation or organizatio ...