Core Points - PennantPark Floating Rate Capital Ltd. will report its financial results for the third fiscal quarter ended June 30, 2025, on August 11, 2025, after market close [1] - A conference call to discuss the financial results will be held on August 12, 2025, at 9:00 a.m. Eastern Time, with access details provided for participants [2] Company Overview - PennantPark Floating Rate Capital Ltd. is a business development company that primarily invests in U.S. middle-market private companies through floating rate senior secured loans, including first lien secured debt, second lien secured debt, and subordinated debt [3] - The company may also engage in equity investments occasionally [3] - The company is managed by PennantPark Investment Advisers, LLC, which oversees approximately $10 billion of investable capital [4] - PennantPark Investment Advisers, LLC has been operational since 2007, providing a range of financing solutions to middle-market borrowers [4]

Independent Private Credit Platform | Investing Since 2007 PennantPark Floating Rate Capital Ltd. Investor Presentation – September 30, 2024 PennantPark – A Pioneer in Private Credit 2 PennantPark Provides Value-Added Capital to Middle Market Borrowers Target Positive Credit Characteristics: Avoid Negative Credit Characteristics: PennantPark is an independent private credit platform focused on the core middle market | A Pioneer in | Core middle | Over $21 billion of | $8.3 billion | | --- | --- | --- | --- ...

Independent Private Credit Platform | Investing Since 2007 PennantPark Floating Rate Capital Ltd. Investor Presentation – March 31, 2025 PennantPark is an independent private credit platform focused on the core middle market | A Pioneer in | Core middle | Over $26 billion of | $10 billion | | --- | --- | --- | --- | | Private Credit | market focus | capital deployed1 | of AUM1 | | Founded in 2007; | Target mid-sized | | | | | companies we believe | Over 780 investments | Serving sophisticated | | long-term ...

Independent Private Credit Platform | Investing Since 2007 2 PennantPark Floating Rate Capital Ltd. Investor Presentation – March 31, 2025 PennantPark – A Pioneer in Private Credit PennantPark is an independent private credit platform focused on the core middle market | A Pioneer in | Core middle | Over $26 billion of | $10 billion | | --- | --- | --- | --- | | Private Credit | market focus | capital deployed1 | of AUM1 | | Founded in 2007; | Target mid-sized | | | | | companies we believe | Over 780 invest ...

MIAMI BEACH, Fla., May 22, 2025 (GLOBE NEWSWIRE) -- PennantPark Floating Rate Capital Ltd. (the “Company”) (NYSE: PFLT) today announced that PennantPark Senior Secured Loan Fund I LLC (“PSSL”) through PSSL’s wholly-owned and consolidated subsidiary, PennantPark CLO VI, LLC (“CLO VI”) has closed the reset of a four-year reinvestment period, twelve-year final maturity $315.8 million debt securitization. The debt issued in this securitization (the “Debt”) is structured in the following manner: ClassPar Amount( ...

Core Insights - Business Development Companies (BDCs) are beginning to experience challenges due to a prolonged period of higher interest rates, with PennantPark Floating Rate Capital (NYSE: PFLT) being one of the affected companies [1] Group 1: Industry Challenges - The prolonged period of higher interest rates is impacting many BDCs, indicating a broader trend within the industry [1] Group 2: Investment Strategy - A hybrid investment strategy that combines classic dividend growth stocks with BDCs, REITs, and Closed End Funds can enhance investment income while achieving total returns comparable to traditional index funds like the S&P [1]

Core Insights - The article discusses the positive outlook on PennantPark Floating Rate Capital (NYSE: PFLT) based on previous analyses and ongoing performance evaluations [1] Group 1: Company Overview - PennantPark Floating Rate Capital has been under coverage since December 2023, with initial bullish sentiments followed by a series of positive reviews [1] - The latest analysis concludes with positive takeaways, indicating a favorable investment perspective [1] Group 2: Analyst Background - Roberts Berzins, the analyst, has over a decade of experience in financial management, aiding top-tier corporates in financial strategy and large-scale financing [1] - Berzins has contributed to institutionalizing the REIT framework in Latvia, enhancing liquidity in pan-Baltic capital markets [1] - His work includes developing national SOE financing guidelines and frameworks for channeling private capital into affordable housing [1]

Financial Data and Key Metrics Changes - For the quarter ended March 31, GAAP net investment income was $0.28 per share, and core net investment income was also $0.28 per share. Adjusted for additional shares issued, core NII would have been $0.30 per share [24] - As of March 31, NAV was $11.7 per share, down 2.4% from $11.34 per share last quarter [24] - The portfolio grew to $2.3 billion, up 7% from the prior quarter [18] Business Line Data and Key Metrics Changes - During the quarter, the company invested $293 million in three new and 54 existing portfolio companies at a weighted average yield of 9.9% [18] - The weighted average debt to EBITDA for new investments was 4.3 times, with an interest coverage of 2.3 times and a loan to value of 39% [10] - The portfolio remains highly diversified with 159 companies across 49 different industries, and the weighted average yield on debt investments was 10.5% [26] Market Data and Key Metrics Changes - Approximately 80% of originations came from existing borrowers, while 20% were from new platform investments [7] - The pricing on first lien term loans appears to have stabilized in the SERFR plus 500 to $5.50 range for high-quality assets [10] - The debt to equity ratio was 1.3 times as of March 31 [25] Company Strategy and Development Direction - The company focuses on the core middle market, providing strategic capital to borrowers in five key sectors: business services, consumer, government services and defense, healthcare, and software and technology [12] - The company aims to preserve capital while seeking investment opportunities in growing middle market companies with high free cash flow conversion [22] - The company has raised significant equity capital through its ATM program, totaling $163 million during the quarter [21] Management's Comments on Operating Environment and Future Outlook - Management noted that despite market volatility, the company had a solid quarter and expects to ramp up portfolio activity in the coming months [6][7] - The management believes that the current vintage of core middle market loans is excellent, with strong credit quality and limited exposure to tariffs [11][12] - The company anticipates that the uncertainty surrounding tariffs needs to be resolved for M&A activity to pick up [34] Other Important Information - The company has taken significant steps to strengthen its balance sheet, increasing total leverage by $750 million over the last twelve months [18] - The company closed on a new $361 million securitization financing with a weighted average spread of 1.59% [19] - Nonaccruals represent only 2.2% of the portfolio at cost and 1.2% at market value, which improved to 1% at cost and 0.5% at market value after the quarter [14][27] Q&A Session Summary Question: On the equity raising during the quarter, was this a long-term capital build or an increase in pipeline activity? - Management indicated that the capital raised was to prepare for a robust 2025, despite a slowdown in activity due to recent market events [29] Question: What is necessary to unlock new M&A activity in the market? - Management stated that certainty in tariffs and a stable environment are needed to encourage decision-making and M&A activity [34] Question: How much of the activity with existing borrowers is repricing versus growth capital? - Management noted that most activity is from existing platforms growing, with repricing having ended due to market changes [40] Question: How does the company view tariff sensitivity for its portfolio versus larger businesses? - Management emphasized that most sectors in their portfolio are not significantly impacted by tariffs, with limited exposure [45] Question: How does the company plan to deploy additional equity into the senior loan fund? - Management expects to deploy excess capital within a six to twelve-month timeframe, depending on market conditions [52] Question: What are the long-term opportunities for growing the joint venture or adding partners? - Management expressed interest in potentially adding another JV partner over time, depending on finding the right fit [56]

Financial Data and Key Metrics Changes - For the quarter ended March 31, GAAP net investment income was $0.28 per share, and core net investment income was also $0.28 per share. Adjusted for additional shares issued, core NII would have been $0.30 per share [24] - As of March 31, NAV was $11.7 per share, down 2.4% from $11.34 per share last quarter [24] - The debt to equity ratio was 1.3 times, indicating a diversified capital structure across multiple funding sources [24] Business Line Data and Key Metrics Changes - The portfolio grew to $2.3 billion, up 7% from the prior quarter, with $293 million invested in three new and 54 existing portfolio companies at a weighted average yield of 9.9% [17] - The weighted average debt to EBITDA ratio for new portfolio investments was 4.3 times, with an interest coverage of 2.3 times [9][11] - Nonaccruals represented only 2.2% of the portfolio at cost and 1.2% at market value, which improved to 1% at cost and 0.5% at market value after two nonaccruals were put back on accrual [14][25] Market Data and Key Metrics Changes - Approximately 80% of originations came from existing borrowers, while 20% were from new platform investments, indicating a strong focus on existing relationships [7] - The pricing on first lien term loans stabilized in the SERFR plus 500 to $5.50 range for high-quality assets [10] - The core middle market remains attractive, with lower leverage and higher spreads compared to the upper middle market [10][12] Company Strategy and Development Direction - The company aims to focus on the core middle market, providing strategic capital to borrowers in five key sectors: business services, consumer, government services and defense, healthcare, and software and technology [12] - The company has taken significant steps to strengthen its balance sheet and enhance liquidity, positioning itself to take advantage of market opportunities [8][21] - The strategy includes maintaining rigorous underwriting standards and being selective in pursuing new investments [8] Management's Comments on Operating Environment and Future Outlook - Management noted that despite market volatility, the company had a solid quarter and expects originations to remain concentrated among existing portfolio companies [7] - The management anticipates that pricing will likely increase and leverage will moderate as buyers and lenders adjust to a new risk framework [8] - The company is optimistic about the upcoming vintage of loans, which is expected to be particularly attractive [8] Other Important Information - The company raised $163 million during the quarter through its ATM program, issuing 14.4 million shares at an average price of $11.33 per share [21] - The joint venture (JV) portfolio totaled $1.1 billion, with $60 million invested during the quarter at a weighted average yield of 9.8% [20] - The company has over $500 million of available capital, enhancing its ability to capitalize on market opportunities [21] Q&A Session Summary Question: On the equity raising during the quarter, was this a long-term capital build or an increase in pipeline activity? - Management indicated that the capital raised was part of preparing for a robust 2025, despite a slowdown in activity due to recent market events [29] Question: What is necessary to unlock new M&A activity in the market? - Management stated that certainty in tariffs and a stable environment are crucial for unlocking new M&A activity, with limited exposure to tariffs in their portfolio [33] Question: How much of the existing borrower activity is repricing versus growth capital? - Management noted that most activity is from existing platforms growing, with repricing having ended due to recent market changes [40] Question: How does the company view the equilibrium in the private credit market? - Management expressed that the focus on the core middle market remains strong, with larger players moving upmarket, creating more opportunities for the company [49]

Financial Performance - For the quarter ended March 2025, PennantPark (PFLT) reported revenue of $61.94 million, which is an increase of 39.7% compared to the same period last year [1] - EPS for the quarter was $0.28, down from $0.31 in the year-ago quarter [1] - The reported revenue fell short of the Zacks Consensus Estimate of $66.49 million, resulting in a surprise of -6.85% [1] - The company experienced an EPS surprise of -15.15%, with the consensus EPS estimate being $0.33 [1] Key Metrics - From non-controlled, non-affiliated investments, other income was reported at $0.63 million, below the average estimate of $1.19 million based on two analysts [4] - Interest income from non-controlled, non-affiliated investments was $49.22 million, exceeding the average estimate of $48.60 million, representing a year-over-year change of +61.5% [4] - Dividend income from non-controlled, non-affiliated investments was $0.37 million, compared to the estimated $0.58 million, reflecting a -36.1% change year-over-year [4] Stock Performance - Shares of PennantPark have returned +5.9% over the past month, outperforming the Zacks S&P 500 composite's +3.8% change [3] - The stock currently holds a Zacks Rank 3 (Hold), indicating potential performance in line with the broader market in the near term [3]