Stock Repurchase and Share Issuance - The company repurchased 1,930 shares of its common stock at an aggregate price of $30,585 from October 1, 2024, to November 5, 2024[141]. - During the nine months ended September 30, 2024, the company issued 5,551,372 shares for an aggregate purchase price of $91.3 million, compared to 2,379,185 shares for $39.3 million in the same period of 2023[173]. - The company repurchased 30,664 shares under the Company Rule 10b5-1 Repurchase Plan during the nine months ended September 30, 2024[175]. Investment Performance and Portfolio - The company had 258 debt and equity investments in 212 portfolio companies with an aggregate fair value of approximately $1.3 billion as of September 30, 2024[151]. - The total investments at fair value as of September 30, 2024, reached $1,389,801,144, up from $1,159,135,422 as of December 31, 2023[155]. - The size of the investment portfolio at fair value increased from $1.0 billion as of December 31, 2023, to $1.3 billion as of September 30, 2024[161]. - Loans on non-accrual status represented 0.26% of total investments at fair value as of September 30, 2024, with no loans on non-accrual status as of December 31, 2023[161]. Investment Income and Expenses - Total investment income for the three months ended September 30, 2024, was $37,306,001, compared to $28,773,690 in 2023, and for the nine months, it was $108,640,440, up from $82,401,055 in 2023[161]. - Interest from investments contributed $35,775,337 to total investment income for the three months ended September 30, 2024, compared to $27,323,754 in 2023[161]. - Net expenses for the three months ended September 30, 2024, were $21.6 million, an increase from $14.0 million in the same period of 2023, primarily due to higher interest expenses[163][164]. - Interest expense for the nine months ended September 30, 2024, was $43.8 million, compared to $32.7 million for the same period in 2023, reflecting an increase in average debt balance from $628.2 million to $793.4 million[165]. Debt and Financing - The company had $376.6 million principal outstanding under the BoA Credit Facility as of September 30, 2024, down from $495.0 million in the prior year[171]. - The BoA Credit Facility has a commitment amount of $525 million, with the ability to draw scheduled to terminate on February 11, 2028[178]. - The WF Credit Facility was amended to increase the borrowing amount from $150 million to $175 million and extend the maturity date to December 18, 2028[184]. - As of September 30, 2024, PS BDC Funding had $376.6 million principal outstanding and $148.4 million of available Commitments under the BoA Credit Facility[182]. - As of September 30, 2024, PS BDC Funding II had $144.1 million outstanding and $30.9 million of available Commitments under the WF Credit Facility[188]. Investment Strategy and Management - The company’s investment objective is to maximize total return, which includes current income and capital appreciation[147]. - The company is externally managed by an Investment Advisor registered with the SEC, which oversees day-to-day operations and investment management[146]. - The company has elected to be regulated as a BDC under the 1940 Act and expects to qualify as a RIC annually[144]. Dividends and Tax Treatment - The company intends to distribute quarterly dividends to stockholders, subject to available income and Board approval[191]. - To maintain RIC tax treatment, the company must distribute at least 90% of its net ordinary income and net short-term capital gains[192]. - The company has adopted a dividend reinvestment plan allowing stockholders to reinvest dividends in additional shares unless they opt for cash[195]. - The company plans to primarily use newly-issued shares for its dividend reinvestment plan, with the number of shares determined by the total dollar amount of the dividend divided by the market price per share on the payment date[197]. Interest Rate Sensitivity and Hedging - The company is subject to interest rate sensitivity, with potential impacts on net investment income due to changes in interest rates[208]. - A hypothetical increase of 300 basis points in interest rates could result in a net increase in investment income of $15.3 million[210]. - The company may hedge against interest rate and currency exchange rate fluctuations using standard hedging instruments such as futures, options, swaps, and forward contracts[212]. - Hedging activities may insulate the company against adverse changes in interest rates[212]. - The company acknowledges that hedging may limit its ability to benefit from lower interest rates regarding its portfolio of investments with fixed interest rates[212]. Valuation and Commitments - The company has unfunded commitments totaling $19.6 million as of September 30, 2024, which may expire without being drawn upon[207]. - As of September 30, 2024, the company has total contractual obligations of $824.4 million, including $373.7 million from the BoA Credit Facility and $305.9 million from the CLO Transaction[206]. - The company measures exposure to interest rate and currency exchange rate fluctuations on an ongoing basis[212]. - The company engages independent valuation providers to review the valuation of material portfolio investments at least once annually[201]. - The company measures realized gains or losses based on the difference between net proceeds from sales and the amortized cost basis of investments[203].
Palmer Square Capital BDC(PSBD) - 2024 Q3 - Quarterly Report