Group 1: Taxation and Economic Impact - The UK Chancellor Rachel Reeves plans to raise £26 billion ($34 billion) in taxes to strengthen the national finances, which has faced collective criticism from CEOs of major UK companies [1] - Business leaders from various sectors, including hotels, insurance, and banking, argue that the budget fails to lay a foundation for economic growth, with some describing it as a "living off borrowed time" budget [1][2] - The increase in business tax rates is expected to force companies to slow down investments in the UK and reduce planned hiring [1][3] Group 2: Industry-Specific Concerns - Butlin's CEO Jon Hendry Pickup criticized the rising business tax rates, stating it would impact their investment and hiring plans, and expressed concern that the burden is not shared equally [1][2] - Peel Hunt Ltd. CEO Steven Fine expressed disappointment over the lack of bold measures in the budget, calling it a series of small-scale initiatives that do not benefit long-term economic development [2] - Phoenix Group Holdings Plc CEO Andy Briggs raised concerns about new limits on salary sacrifice for workplace pensions, suggesting it could discourage pension contributions [2] Group 3: Sector Reactions - Young & Co.'s Brewery Plc CEO Simon Dodd highlighted the negative impact of increased alcohol taxes and minimum wage hikes, which could lead to hiring freezes in the hospitality sector [3] - Funding Circle Holdings Plc CEO Lisa Jacobs described the budget as "relatively mild" for small businesses, noting potential benefits from adjustments in business tax rates but lamenting the lack of changes to financing support [4] - Associated British Foods Plc CEO George Weston welcomed the commitment to close tariff loopholes for low-value imports but expressed disappointment over high tax rates on large properties [4] Group 4: Electric Vehicle Policy - Auto Trader Group Plc CEO Nathan Coe criticized the government's confusing approach to electric vehicles, as new mileage-based taxes are set to be introduced while promoting zero-emission vehicles [5] Group 5: Digital Economy Initiatives - Sage Plc CEO Steve Hare praised the budget for its "robust" approach benefiting small businesses and welcomed plans for mandatory electronic invoicing, highlighting the government's commitment to digitalizing the economy [6]

Financial Data and Key Metrics Changes - For the quarter ended September 30, core net investment income was $0.15 per share compared to total distributions of $0.24 per share [4] - As of September 30, the net asset value (NAV) was $7.11 per share, down 3.4% from $7.36 per share in the prior quarter [14] - The debt-to-equity ratio was 1.6 times, with a target ratio of 1.25-1.3 times [14][15] Business Line Data and Key Metrics Changes - The portfolio totaled $1.3 billion, with 166 companies across 37 different industries [11][15] - The weighted average yield on debt investments was 11%, with 91% of the portfolio being floating rate [15] - The median leverage ratio on debt securities was 4.5 times, and the median interest coverage ratio was 2 times [7][15] Market Data and Key Metrics Changes - The company is encouraged by a steady increase in transaction activity in the private middle-market lending sector, expecting higher loan origination volumes [5][7] - In the core middle market, pricing on high-quality first lien loans is between $475-$525, with reasonable leverage and meaningful covenant protections [7][9] Company Strategy and Development Direction - The company is focused on rotating out of equity positions and redeploying capital into interest-bearing debt investments to increase core net investment income [4][5] - The strategy emphasizes capital preservation and disciplined investment in growing middle-market companies with high free cash flow conversion [12] Management's Comments on Operating Environment and Future Outlook - Management is optimistic about the increase in transaction activity leading to opportunities for equity rotation and new income-producing investments [7] - The current market environment is seen as favorable for lenders with strong private equity sponsor relationships and disciplined underwriting [7][9] Other Important Information - The company has $48 million, or $0.73 per share, of undistributed spillover income, which will be used to cover shortfalls in net investment income versus the dividend [5] - The PSLF joint venture portfolio totaled $1.3 billion, with an average net investment income yield of 17% over the last 12 months [11] Q&A Session Summary Question: Why not right-size the dividend today? - Management is constantly evaluating the dividend and has substantial spillover income that needs to be paid out, balancing this with the equity rotation process [20] Question: Any updates on realization events for equity positions? - Management is seeing more activity and is hopeful for rotation opportunities, with a constructive backdrop for monetizing some equity positions [23] Question: What types of deals are being seen with increased investment activity? - The deals are a combination of add-on delayed draw term loans for existing companies and new platform investments with strong credit quality [45] Question: How does the company view dividend recaps? - Dividend recaps are approached cautiously, with a high bar for participation, focusing on alignment of interests and substantial equity beneath the loans [50] Question: What are the trends in the private equity space? - There is optimism for equity rotation as the M&A market is starting to pick up, with buyers and sellers beginning to find common ground [52][53]