Nuveen Churchill Direct Lending(NCDL) - 2024 Q4 - Annual Results

Full Year and Fourth Quarter 2024 Results Announcement NCDL reported strong Q4 2024 results with increased NAV and net investment income, alongside record originations and a strategic capital structure optimization for 2025 Q4 2024 Financial Highlights and Management Commentary Nuveen Churchill Direct Lending Corp. (NCDL) reported strong Q4 2024 results, with net investment income of $0.56 per share and a net asset value (NAV) increase to $18.18 per share Financial Highlights for Q4 2024 | Metric | Value | | :--- | :--- | | Net Investment Income per Share | $0.56 | | Net Realized & Unrealized Loss per Share | ($0.02) | | Net Increase in Net Assets per Share | $0.54 | | Net Asset Value (NAV) per Share | $18.18 | - Management noted 2024 was an active year for originations, with over $950 million in new investments, a YoY increase of over 40%[3] - For the full year 2024, the company delivered a return on equity exceeding 12%, with distributions fully covered by net investment income[3] - The company strengthened its balance sheet by issuing $300 million of unsecured notes in January 2025, ensuring ample liquidity and no near-term debt maturities[3] Distribution Declaration The Board of Directors has declared a regular quarterly distribution of $0.45 per share for the first quarter of 2025, in addition to a final special distribution of $0.10 per share - A first quarter 2025 regular distribution of $0.45 per share was declared, payable on April 28, 2025, to shareholders of record as of March 31, 2025[4] - The final of four special distributions of $0.10 per share will be paid on April 28, 2025[4] Portfolio Analysis The investment portfolio expanded to $2.08 billion, maintaining a defensive first-lien debt focus, while significantly improving asset quality with reduced non-accrual investments Portfolio Composition and Quality As of December 31, 2024, the investment portfolio's fair value grew to $2.08 billion across 210 companies, maintaining a defensive position with 90.6% in first-lien debt Portfolio Metrics | Metric | Dec 31, 2024 | Sep 30, 2024 | | :--- | :--- | :--- | | Portfolio Fair Value | $2.08 billion | $2.05 billion | | Portfolio Companies | 210 | 202 | | Industries | 27 | 26 | Investment Type Composition | Investment Type | % of Portfolio (Fair Value) - Dec 31, 2024 | % of Portfolio (Fair Value) - Sep 30, 2024 | | :--- | :--- | :--- | | First-Lien Debt | 90.6% | 90.1% | | Subordinated Debt | 7.7% | 8.3% | | Equity Investments | 1.8% | 1.7% | - Portfolio quality improved, with non-accrual investments decreasing from three companies (1.4% at cost) in Q3 to one company (0.4% at cost) in Q4 2024. No new portfolio companies were placed on non-accrual status during the quarter[8] Portfolio and Investment Activity For the full year 2024, NCDL significantly increased its investment pace, funding $863.6 million, a substantial rise from $589.0 million in 2023 Full Year Investment Activity | Full Year Activity | 2024 | 2023 | | :--- | :--- | :--- | | Funded Investments | $863.6 million | $589.0 million | | Proceeds from Repayments/Sales | $430.0 million | $146.4 million | Quarterly Investment Activity | Quarterly Activity | Q4 2024 | Q3 2024 | | :--- | :--- | :--- | | Funded Investments | $151.1 million | $203.2 million | | Proceeds from Repayments/Sales | $119.5 million | $155.6 million | Results of Operations Investment income increased due to portfolio growth, while expenses rose from higher interest and management fees, partially offset by net unrealized gains Investment Income Full-year 2024 investment income grew to $224.0 million from $161.8 million in 2023, driven by a larger investment portfolio, despite a decrease in weighted average yield - Full-year 2024 investment income increased to $224.0 million from $161.8 million in 2023, primarily due to increased deployed capital[11] - The weighted average yield of debt investments decreased to 10.33% as of Dec 31, 2024, from 11.72% a year prior, due to spread tightening and a decline in SOFR[11] - Q4 2024 investment income was $57.1 million, up from $48.9 million in Q4 2023[12] Net Expenses Net expenses for 2024 rose to $101.1 million from $77.9 million in 2023, mainly due to higher interest expenses and management fees, with incentive fees waived through Q1 2025 - Full-year 2024 net expenses increased to $101.1 million from $77.9 million in 2023, driven by higher interest, debt financing expenses, and management fees[13] - The Adviser is waiving incentive fees on income and capital gains for the five quarters from March 31, 2024, through March 31, 2025[13] Net Realized and Unrealized Gains/Losses For the full year 2024, the company experienced a net realized loss of $(13.2) million, largely offset by a net unrealized gain of $7.3 million from market spread tightening Full Year Performance | Full Year Performance | 2024 | 2023 | | :--- | :--- | :--- | | Net Realized Loss | $(13.2) million | $(8.0) million | | Net Change in Unrealized Gain | $7.3 million | $0.7 million | Fourth Quarter Performance | Fourth Quarter Performance | Q4 2024 | Q4 2023 | | :--- | :--- | :--- | | Net Realized Loss | $(11.7) million | $(1.5) million | | Net Change in Unrealized Gain | $11.3 million | $4.5 million | Financial Condition and Liquidity NCDL maintains robust liquidity with $43.3 million cash and $206.3 million available credit, supporting a debt-to-equity ratio of 1.15x Liquidity and Capital Resources As of December 31, 2024, NCDL maintained a solid liquidity position with $43.3 million in cash and approximately $206.3 million available for borrowing under its credit facilities Liquidity Metrics (as of Dec 31, 2024) | Liquidity Metric (as of Dec 31, 2024) | Value | | :--- | :--- | | Cash and Cash Equivalents | $43.3 million | | Total Debt Outstanding | $1.1 billion | | Available Borrowing Capacity | $206.3 million | | Debt to Equity Ratio | 1.15x | - The debt-to-equity ratio increased to 1.15x at year-end, compared to 1.11x at the end of Q3 2024[17] Consolidated Financial Statements Total assets and net assets grew significantly, reflecting increased investment income and a substantial rise in new gross commitments for the year Consolidated Statements of Assets and Liabilities As of December 31, 2024, total assets increased to $2.14 billion from $1.73 billion a year prior, driven by growth in the investment portfolio, resulting in a NAV per share of $18.18 Balance Sheet (in thousands) | Balance Sheet (in thousands) | Dec 31, 2024 | Dec 31, 2023 | | :--- | :--- | :--- | | Total Investments, at fair value | $2,081,379 | $1,641,686 | | Total Assets | $2,143,725 | $1,730,864 | | Total Liabilities | $1,173,405 | $982,979 | | Total Net Assets | $970,320 | $747,885 | | Net Asset Value per Share | $18.18 | $18.13 | Consolidated Statements of Operations For the year ended December 31, 2024, NCDL reported total investment income of $224.0 million and net investment income of $122.4 million, resulting in a net increase in net assets from operations of $116.3 million Income Statement (Year Ended Dec 31, in thousands) | Income Statement (Year Ended Dec 31, in thousands) | 2024 | 2023 | | :--- | :--- | :--- | | Total Investment Income | $224,040 | $161,756 | | Net Expenses | $101,101 | $77,744 | | Net Investment Income | $122,388 | $84,006 | | Total Net Realized & Unrealized Loss | $(6,065) | $(8,068) | | Net Increase in Net Assets from Operations | $116,323 | $75,938 | | Net Investment Income per Share | $2.26 | $2.52 | | Net Increase in Net Assets per Share | $2.15 | $2.27 | Detailed Portfolio and Investment Activity In 2024, NCDL's new gross commitments surged to $955.3 million, with first-lien debt comprising the vast majority, and the number of portfolio companies growing to 210 Full Year Investment Activity | Full Year Investment Activity | 2024 | 2023 | | :--- | :--- | :--- | | New Gross Commitments at Par | $955.3 million | $670.6 million | | Net Funded Investment Activity | $433.6 million | $442.6 million | | Number of New Portfolio Companies | 68 | 45 | | Portfolio Companies, End of Period | 210 | 179 | | W.A. Interest Rate on New Debt | 10.11% | 11.50% | Quarterly Investment Activity | Quarterly Investment Activity | Q4 2024 | Q3 2024 | | :--- | :--- | :--- | | New Gross Commitments at Par | $162.7 million | $225.6 million | | Net Funded Investment Activity | $31.6 million | $47.5 million | | Number of New Portfolio Companies | 16 | 18 | | W.A. Interest Rate on New Debt | 8.96% | 9.63% |