PennantPark Floating Rate Capital .(PFLT) - 2025 Q3 - Quarterly Results

Financial Results and Highlights Third Quarter 2025 Financial Highlights PFLT reported a Q3 2025 NAV per share of $10.96, a 1.0% decrease, with net investment income at $0.25 per share and a $2.4 billion investment portfolio Q3 2025 Key Financial Metrics | Metric | Value | | :--- | :--- | | Assets and Liabilities | | | Investment Portfolio | $2,403.5 million | | Net Assets | $1,087.5 million | | Net Asset Value (NAV) per Share | $10.96 | | Quarterly Change in NAV per Share | (1.0)% | | Regulatory Debt to Equity | 1.29x | | Operating Results | | | Net Investment Income per Share | $0.25 | | Core Net Investment Income per Share | $0.27 | | Distributions Declared per Share | $0.31 | | Portfolio Activity | | | Purchases of Investments | $208.1 million | | Sales and Repayments | $145.8 million | - Core Net Investment Income (Core NII) is a non-GAAP measure that excludes $2.9 million of credit facility amendment costs and a $1.2 million incentive fee expense offset for the quarter[2] Portfolio and Investment Activity Overall Portfolio Review The portfolio grew to $2.4 billion as of June 30, 2025, with 99% first lien secured debt and a 10.4% weighted average yield - Management anticipates continued net investment income growth driven by recent capital raises and the formation of a new joint venture with Hamilton Lane to invest in middle-market senior secured loans[5] Portfolio Composition Comparison | Metric | June 30, 2025 | September 30, 2024 | | :--- | :--- | :--- | | Total Portfolio | $2,403.5 M | $1,983.5 M | | First Lien Secured Debt | $2,150.6 M | $1,746.7 M | | Number of Companies | 155 | 158 | | Avg. Investment Size | $15.5 M | $12.6 M | | Weighted Avg. Yield on Debt | 10.4% | 11.5% | | Non-Accruals (at fair value) | 0.5% | 0.2% | Investment Activity Details Q3 2025 investments totaled $208.1 million, a decrease from prior year, with nine-month investments reaching $1.1 billion Investment Activity (Three Months Ended June 30) | Metric | 2025 | 2024 | | :--- | :--- | :--- | | Investments | $208.1 M | $320.9 M | | Weighted Avg. Yield on New Debt | 10.1% | 11.5% | | Sales and Repayments | $145.8 M | $137.6 M | Investment Activity (Nine Months Ended June 30) | Metric | 2025 | 2024 | | :--- | :--- | :--- | | Investments | $1,108.3 M | $961.8 M | | Weighted Avg. Yield on New Debt | 10.2% | 11.7% | | Sales and Repayments | $669.5 M | $386.3 M | PennantPark Senior Secured Loan Fund I LLC (PSSL) PSSL's portfolio grew to $1.06 billion as of June 30, 2025, with a 10.4% weighted average yield on debt investments PSSL Portfolio Overview | Metric | June 30, 2025 | September 30, 2024 | | :--- | :--- | :--- | | Total Portfolio | $1,055.6 M | $913.3 M | | Number of Companies | 117 | 109 | | Avg. Investment Size | $9.0 M | $8.4 M | | Weighted Avg. Yield on Debt | 10.4% | 11.4% | - For the three months ended June 30, 2025, PSSL invested $52.3 million and had sales/repayments of $53.8 million[10][11] Results of Operations Investment Income Q3 2025 total investment income increased to $63.5 million, driven by the growing size of the debt portfolio Investment Income Comparison (in millions) | Period | 2025 | 2024 | Change Driver | | :--- | :--- | :--- | :--- | | Three Months Ended June 30 | $63.5 | $48.5 | Increase in size of debt portfolio | | Nine Months Ended June 30 | $192.4 | $130.8 | Increase in size of debt portfolio | Expenses Q3 2025 expenses rose to $38.9 million, primarily due to higher interest, management fees, and credit facility amendment costs Expenses Comparison (in millions) | Period | 2025 | 2024 | Change Driver | | :--- | :--- | :--- | :--- | | Three Months Ended June 30 | $38.9 | $27.3 | Higher interest expense, management fees, and amendment costs | | Nine Months Ended June 30 | $112.8 | $71.1 | Higher interest expense and management fees | Net Investment Income (NII) Q3 2025 net investment income was $24.6 million or $0.25 per share, with per-share NII decreasing due to higher share count Net Investment Income Comparison | Period | 2025 | 2024 | | :--- | :--- | :--- | | Three Months Ended June 30 | | | | NII (in millions) | $24.6 | $21.2 | | NII per Share | $0.25 | $0.31 | | Nine Months Ended June 30 | | | | NII (in millions) | $79.6 | $59.7 | | NII per Share | $0.88 | $0.95 | Realized and Unrealized Gains/Losses Q3 2025 saw a net realized loss of $14.8 million and a net unrealized appreciation of $9.9 million on investments - For the three months ended June 30, 2025, the company experienced net realized losses of $(14.8) million, a significant change from the $(0.4) million loss in the same period of 2024[17] - The net change in unrealized appreciation on investments was $9.9 million for the quarter, compared to a depreciation of $(4.0) million in Q3 2024, driven by portfolio performance and capital market conditions[19] Net Change in Net Assets Q3 2025 net increase in net assets from operations was $19.3 million, or $0.19 per share, influenced by portfolio and market conditions Net Increase in Net Assets from Operations | Period | 2025 | 2024 | | :--- | :--- | :--- | | Three Months Ended June 30 | | | | Net Increase (in millions) | $19.3 | $16.9 | | Per Share | $0.19 | $0.25 | | Nine Months Ended June 30 | | | | Net Increase (in millions) | $48.9 | $70.5 | | Per Share | $0.54 | $1.12 | Liquidity and Capital Resources Capital Structure and Debt Facilities The company amended its credit facility in April 2025, reducing pricing and extending maturity, and PSSL closed a new $301 million CLO - The annualized weighted average cost of debt decreased to 7.0% for the nine months ended June 30, 2025, from 7.3% in the prior year period[23] - In April 2025, the credit facility was amended, reducing pricing to SOFR + 200 bps and extending the maturity to August 2030[24] - PSSL closed a new $301 million CLO in April 2025 and refinanced its 2035 Asset-Backed Debt in May 2025, extending maturities to 2037[25][26] Cash Flow and Equity Issuances As of June 30, 2025, the company held $102.7 million in cash, with $244.8 million raised through its ATM program - The company held cash and cash equivalents of $102.7 million as of June 30, 2025[27] ATM Program Issuances (Nine Months Ended June 30) | Period | Shares Issued | Avg. Price | Net Proceeds | | :--- | :--- | :--- | :--- | | 2025 | 21,638,000 | $11.34 | $244.8 M | | 2024 | 13,263,436 | $11.39 | $150.6 M | - For the nine months ended June 30, 2025, cash used in operations was $386.1 million, while cash provided by financing was $376.7 million[29] Shareholder Distributions and Recent Developments Distributions The company declared distributions of $0.3075 per share for Q3 2025, totaling $83.4 million for the nine-month period Distributions Declared | Period | Per Share | Total (in millions) | | :--- | :--- | :--- | | Three Months Ended June 30, 2025 | $0.3075 | $30.5 | | Nine Months Ended June 30, 2025 | $0.9225 | $83.4 | Recent Developments A new joint venture, PSSL II, was formed with Hamilton Lane in August 2025, targeting an initial $500 million portfolio - A new joint venture, PSSL II, was formed in August 2025 with Hamilton Lane (HL) to invest in middle-market loans[32] - PFLT and HL have committed a combined $200 million ($150 million from PFLT, $50 million from HL) and intend to add a $300 million financing facility, targeting an initial portfolio size of $500 million[33] Consolidated Financial Statements Consolidated Statements of Assets and Liabilities As of June 30, 2025, total assets reached $2.52 billion, with net assets growing to $1.09 billion, though NAV per share decreased to $10.96 Balance Sheet Summary (in thousands) | Account | June 30, 2025 | September 30, 2024 | | :--- | :--- | :--- | | Total Investments, at fair value | $2,403,515 | $1,983,504 | | Total Assets | $2,521,602 | $2,108,845 | | Total Liabilities | $1,434,089 | $1,231,551 | | Total Net Assets | $1,087,513 | $877,294 | | Net Asset Value per Share | $10.96 | $11.31 | Consolidated Statements of Operations Q3 2025 total investment income was $63.5 million, resulting in net investment income of $24.6 million and a net increase in net assets of $19.3 million Income Statement Summary (Three Months Ended June 30, in thousands) | Account | 2025 | 2024 | | :--- | :--- | :--- | | Total Investment Income | $63,502 | $48,505 | | Total Expenses | $38,877 | $27,295 | | Net Investment Income | $24,625 | $21,210 | | Net Realized/Unrealized Loss | $(5,327) | $(4,290) | | Net Increase in Net Assets | $19,298 | $16,920 | Per Share Data (Three Months Ended June 30) | Metric | 2025 | 2024 | | :--- | :--- | :--- | | Net Investment Income per Share | $0.25 | $0.31 | | Net Increase in Net Assets per Share | $0.19 | $0.25 |