Goldman Sachs BDC(US:GSBD)2025-11-06 21:47Investment Overview - The company has originated approximately $9.49 billion in aggregate principal amount of debt and equity investments from its formation in 2012 through September 30, 2025[245]. - As of September 30, 2025, the total investments amounted to $3,315.50 million, with a fair value of $3,196.93 million[261]. - The portfolio includes $3,050.87 million in first lien/senior secured debt, with a fair value of $3,301.75 million as of December 31, 2024[261]. - The company focuses on lending to middle-market companies, defined as those with annual EBITDA between $5 million and $200 million[248]. - Performing investments accounted for 97.5% of total investments at an amortized cost of $3,231.94 million as of September 30, 2025[273]. - Non-accrual investments represented 2.5% of total investments, amounting to $83.56 million as of September 30, 2025[273]. - The total investments decreased to $3,196.93 million as of September 30, 2025, from $3,475.26 million[270]. - The number of portfolio companies increased to 171 as of September 30, 2025, compared to 164 as of December 31, 2024[264]. Financial Performance - The company generates revenues primarily through interest income from investments, with additional income from various fees and capital gains[254]. - Total investment income decreased to $91.60 million for the three months ended September 30, 2025, down from $110.41 million in the same period of 2024, representing a decline of 17.5%[277]. - Net investment income after taxes was $45.31 million for the three months ended September 30, 2025, compared to $68.18 million for the same period in 2024, a decrease of 33.5%[277]. - Interest income from investments decreased to $82.58 million for the three months ended September 30, 2025, down from $99.14 million in the same period of 2024, a decline of 16.7%[284]. - The weighted average yield on debt and income-producing investments at amortized cost decreased to 10.3% from 11.2%[264]. - The weighted average yield at amortized cost was 9.8%, down from 10.1% as of December 31, 2024[263]. - The weighted average leverage (net debt/EBITDA) improved to 5.8x from 6.2x[264]. - The median EBITDA of portfolio companies increased to $70.85 million as of September 30, 2025, from $66.14 million[264]. Expenses and Commitments - The company anticipates general and administrative expenses to remain stable or decline as a percentage of total assets during periods of asset growth[258]. - Total expenses increased to $45.38 million for the three months ended September 30, 2025, compared to $40.74 million in the same period of 2024, an increase of 11.5%[283]. - The company has unfunded commitments totaling $636.23 million as of September 30, 2025, compared to $492.97 million as of December 31, 2024[322]. - The total contractual obligations as of September 30, 2025, include $500.00 million for 2026 Notes, $400.00 million for 2027 Notes, and $400.00 million for 2030 Notes[308]. Investment Strategy and Risk - The company employs leverage through a revolving credit facility and notes, aiming for an asset coverage ratio of at least 150% after borrowing[259]. - The company may invest in "covenant-lite" loans, which have fewer financial maintenance covenants, potentially increasing risk[247]. - The company expects net investment income to be affected by the difference between the rate at which it invests and the rate at which it borrows[330]. - A 300 basis point increase in interest rates could result in an increase in income of $73.83 million, while a 300 basis point decrease could lead to a decrease in income of $73.06 million[333]. - The company may enter into hedging transactions to reduce exposure to currency fluctuations and interest rate risks, subject to regulatory compliance[323]. Shareholder Returns - The Board of Directors declared a quarterly base distribution of $0.32 per share, payable on or about January 27, 2026, to holders of record as of December 31, 2025[328]. - The company announced a distribution framework providing a quarterly base distribution and a variable supplemental distribution, subject to certain measurement tests[298]. - The company has a voluntary dividend reinvestment plan (DRIP) for automatic reinvestment of cash distributions unless stockholders opt out[305]. Asset Management - The asset coverage ratio based on the aggregate amount outstanding of senior securities was 178% as of September 30, 2025[296]. - The net asset value per share as of September 30, 2025 was $12.75, down from $13.41 as of December 31, 2024[300]. - The company has entered into interest rate swaps to mitigate the impact of changes in market interest rates on its net asset value[331]. - The company regularly measures its exposure to interest rate risk by comparing interest rate sensitive assets to liabilities[332]. Management and Governance - The management fee and incentive fee compensate the investment adviser for identifying, evaluating, and monitoring investments[256]. - The Board of Directors approved a 10b5-1 stock repurchase program allowing the company to repurchase up to $75.00 million of shares if trading below the most recently announced quarter-end NAV per share[303]. - The preparation of consolidated financial statements requires management to make estimates and assumptions that could cause actual results to differ materially[325]. - Significant accounting policies include those related to investments, revenue recognition, and income taxes, with fair value measurement being the most critical estimate[326].