Barings(US:BBDC)2025-11-06 21:21Investment Portfolio - As of September 30, 2025, the total value of the investment portfolio was $2,536.3 million, an increase from $2,449.3 million as of December 31, 2024[418] - The company had investments in 333 portfolio companies with an aggregate cost of $2,564.0 million as of September 30, 2025, compared to 328 companies and $2,522.7 million as of December 31, 2024[418] - As of September 30, 2025, the total investment portfolio fair value was $2,536.3 million, with senior debt and first lien notes comprising 70% of the portfolio[419] - The total cost of the investment portfolio as of September 30, 2025, was $2,564.0 million, with equity shares accounting for 15% of the total cost[419] - The fair value of the investment portfolio as of December 31, 2024, was $2,449.3 million, with senior debt and first lien notes also comprising 69% of the portfolio[419] Investment Performance - During the nine months ended September 30, 2025, the company made 47 new investments totaling $356.6 million and recognized a net realized loss of $27.7 million from 32 loan repayments totaling $187.0 million[420] - The company recognized a net realized gain of $3.9 million from the sale of equity investments totaling $25.9 million during the nine months ended September 30, 2025[420] - The company received $124.5 million in principal payments and sales proceeds from portfolio companies, with a net realized loss of $0.2 million on these transactions[420] - The net realized losses for the three months ended September 30, 2025, totaled $1.3 million, compared to net realized losses of $10.9 million for the same period in 2024, representing an improvement of 88.01%[450][452] - During the nine months ended September 30, 2025, net realized losses amounted to $17.5 million, a decrease from $24.3 million in the same period of 2024, reflecting a 28.68% improvement[450][459] Income and Expenses - Total investment income for the three months ended September 30, 2025, was $72.4 million, a slight increase from $70.9 million for the same period in 2024[437] - Net investment income after taxes for the three months ended September 30, 2025, was $33.6 million, compared to $30.2 million for the same period in 2024, reflecting a year-over-year increase of 8.0%[437] - Total operating expenses for the three months ended September 30, 2025, were $37.5 million, a decrease from $39.6 million in the same period of 2024[440] - Interest and other financing fees for the three months ended September 30, 2025, were $21.5 million, down from $22.6 million in the same period of 2024, primarily due to a lower weighted average interest rate[441] - Dividends from portfolio companies for the three months ended September 30, 2025, were $14.2 million, compared to $9.8 million for the same period in 2024, representing a 45.0% increase[439] Debt and Financing - The company had borrowings under the February 2019 Credit Facility of £48.6 million ($65.4 million) and €245.6 million ($288.6 million) with interest rates of 5.875% and 3.750% respectively[465] - The fair value of the borrowings outstanding under the February 2019 Credit Facility was $354.0 million as of September 30, 2025[466] - The company issued $50.0 million in Series A senior unsecured notes due August 2025 with a fixed interest rate of 4.66%[467] - The November 2020 NPA included $62.5 million in Series B senior unsecured notes due November 2025 and $112.5 million in Series C senior unsecured notes due November 2027, with fixed interest rates of 4.25% and 4.75% respectively[472] - The company entered into a $300.0 million notional value interest rate swap with a fixed rate interest of 5.20% and a payment based on SOFR plus 2.059%, maturing on September 15, 2028[502] Cash and Liquidity - As of September 30, 2025, the company had $83.2 million in cash and foreign currencies on hand, including $12.9 million of restricted cash[459] - The company experienced a net cash decrease of $8.1 million for the nine months ended September 30, 2025, driven by significant cash outflows from operating activities[459] - For the nine months ended September 30, 2025, cash used in operating activities was $44.0 million, primarily due to portfolio investments purchases totaling $561.6 million[459] - The total unused commitments to extend financing amounted to $20,000, with specific commitments including $1,031 for Accelevation LLC and $1,671 for Accurus Aerospace Corporation[538] Shareholder Returns - The company authorized a new share repurchase program on February 20, 2025, allowing for the repurchase of up to $30.0 million in common stock, effective until March 1, 2026[504] - During the nine months ended September 30, 2025, the company repurchased 250,000 shares at an average price of $9.35 per share[504] - The company intends to pay quarterly distributions, with a declared distribution of $0.26 per share payable on December 10, 2025[511] - The company has adopted a dividend reinvestment plan (DRIP) for stockholders, allowing for automatic reinvestment of dividends unless opted out[505] Risk and Valuation - The fair value of investments is determined using Level 3 inputs for privately held companies, with independent valuations performed quarterly for certain loans and equity investments[524] - The company may need to distribute income to stockholders to meet minimum distribution requirements, even for non-accrual investments[530] - The fair value of investments in certain LLCs is estimated using NAV and ownership percentage due to the lack of readily determinable fair values[526] - A hypothetical increase of 300 basis points in interest rates would result in an increase in net income by $30,692 thousand, while a decrease of 50 basis points would lead to a decrease in net income by $5,115 thousand[551]