Financial Data and Key Metrics Changes - For Q3 2025, the company reported recurring cash flows of $77 million or $0.59 per share, down from $85 million or $0.69 per share in Q2 2025 [5] - The net investment income less realized losses was $21 million or $0.16 per share, compared to $0.16 per share in the previous quarter and $0.23 per share in Q3 2024 [10] - The company's NAV as of September 30 was $7 per share, a decrease of 4.2% from $7.31 per share as of June 30 [5] - GAAP net income for Q3 2025 was $16 million or $0.12 per share, down from $0.47 per share in the previous quarter [10] Business Line Data and Key Metrics Changes - The company deployed nearly $200 million into new investments during the quarter, focusing on both primary and secondary markets [4][12] - The weighted average remaining reinvestment period (WARP) ended at 3.4 years, which is 26% above the market average of 2.7 years [6] - The company completed 16 refinancings and 11 resets during the quarter, enhancing the earning power of its CLO equity portfolio [4] Market Data and Key Metrics Changes - The S&P UBS Leveraged Loan Index returned 1.6% for Q3 2025, with a trailing 12-month default rate of 1.5%, up from 1.1% as of June 30 [15] - The CLO market saw $53 billion in volume during the quarter, with significant increases in reset and refinancing activity [17] - The company's CCC-rated exposures within its CLO equity portfolio stood at 4.6%, lower than the broader market average of 4.8% [18] Company Strategy and Development Direction - The company is focused on portfolio rotation and optimization to enhance cash flows and earning power [6] - Management highlighted a robust pipeline of additional resets and refinancings planned into 2026 [4] - The company aims to maintain a competitive advantage through its attractive cost of capital and proactive management of its CLO equity investments [8] Management's Comments on Operating Environment and Future Outlook - Management noted that loan fundamentals remain strong despite recent pressures from loan repricings [15] - The company expects to see a return of repricing activity as 42% of loans are trading above par [7] - Management expressed optimism about the near-term investment pipeline, citing stabilizing market conditions [19] Other Important Information - The company utilized its at-the-market program, issuing $26 million of common stock at a premium to NAV [7] - The board declared regular monthly distributions of $0.14 per share for the first quarter of 2026 [8] - The company recorded a comprehensive loss of $2.5 million for Q3 2025 [11] Q&A Session Summary Question: Can you provide more color on the timeline for portfolio resets and refinancings? - Management anticipates actions on another 20% of the portfolio over the next one to two quarters, depending on market conditions [22] Question: What are the near-term investment opportunities in the primary and secondary markets? - The primary market remains active with plenty of issuance opportunities, while the secondary market has selective opportunities for investment [25] Question: How have loan spreads changed in October compared to September? - Loan spread compression has slowed, with the weighted average spread on loans down approximately 50 basis points over the last year [30] Question: What factors drove the decline in recurring cash flows? - The principal factor was spread compression, which fell by about eight basis points this quarter [38] Question: Is there a plan to refinance the Series F preferreds soon? - The call date for the Series F preferreds is January 18, 2026, and management is considering refinancing options [44] Question: How does the decline in NAV relate to market pricing and spreads? - The largest component of the NAV decline was the excess of distributions over net investment income [56]