Financial Data and Key Metrics Changes - Adjusted net investment income for Q3 2025 was $0.32 per share, covering the $0.32 per share dividend paid on September 30 [5] - Net asset value per share declined by $0.15 compared to Q2, now at $12.06, due to modest declines across four investments [5][15] - Total investment income for the quarter was $80 million, a 4% decrease compared to the prior quarter [26] - Total net expenses decreased by 5% to $47 million, including a fee waiver [27] Business Line Data and Key Metrics Changes - NMFC's portfolio loan-to-value stands at 45%, with a focus on defensive growth sectors such as healthcare and IT [6][24] - Senior-oriented assets increased to 80% of the overall portfolio, up from 78% in the prior quarter [12][23] - The average yield of NMFC's portfolio decreased slightly to 10.4% due to lower yields on originations compared to repayments [24] Market Data and Key Metrics Changes - The direct lending market remains attractive, with stable spreads despite a lack of significant M&A activity [19][20] - Most unitranche loans are pricing at SOFR plus 450-500 range, indicating a stable pricing environment [20] - Approximately 80% of investments are senior in nature, reflecting a shift towards lower-risk assets [23] Company Strategy and Development Direction - NMFC aims to improve the quality and diversity of its asset base while optimizing liabilities and enhancing income quality [12] - The company is exploring a portfolio sale of up to $500 million to diversify its portfolio and reduce PIK income [7][8] - NMFC's management emphasizes shareholder alignment, with 14% of outstanding shares owned by employees and senior advisors [11] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the deal environment improving in Q4 and 2026, with expectations of increased repayments [36] - The company remains committed to maintaining leverage within a target range of 1 to 1.25 [26][36] - Management is focused on reversing unrealized depreciation within the existing portfolio and recovering full principal value on challenged investments [17][58] Other Important Information - NMFC has fully utilized a $50 million stock repurchase program, repurchasing approximately $47 million in shares at an average price of $10 [7] - The company has a diversified portfolio across 127 companies, with the top 10 single-name issuers accounting for 26% of total fair value [25] Q&A Session Summary Question: Regarding the potential portfolio sale - The sale will focus on the largest positions to diversify the portfolio and reduce PIK income, including both PIK and cash-yielding names [34] Question: On the buyback strategy - The company aims to stay within leverage levels while potentially using repayments to buy back stock if conditions allow [36] Question: About deployment capacity and strategy - NMFC remains active in the market but is prioritizing share repurchases due to leverage considerations [41] Question: On the potential secondary sale and use of proceeds - Proceeds could be used for debt repayment, stock repurchases, or new loans to diversify the portfolio [44] Question: Concerns about other portfolio positions affected by tariffs - The portfolio is well-positioned against tariff impacts, with Beauty Industry Group being the only significant exposure [55] Question: On the performance of Admentum - Admentum's performance is stable, and the company is working on targeted M&A to grow the business [67]

Financial Data and Key Metrics Changes - Net investment income (NII) per share was $0.39 for the quarter, corresponding to an annualized return on equity (ROE) of 10.5% [11] - GAAP net income per share was $0.19, corresponding to an annualized ROE of 5.2% [11] - Net asset value (NAV) per share was $14.75, down 1.2% compared to the prior quarter [11] Business Line Data and Key Metrics Changes - MFIC made $262 million of new commitments across 29 transactions during the quarter [12] - The weighted average spread on new commitments was 538 basis points, with a slight increase compared to the prior quarter [12][23] - The weighted average net leverage on new commitments was 4.0 times, down from 4.2 times in the prior quarter [23] Market Data and Key Metrics Changes - The quarter began with heightened volatility due to U.S. tariffs, but market sentiment improved as tariffs were paused and trade deals were struck [20] - The labor market showed resilience with steady unemployment, and the Federal Reserve kept its policy rate unchanged [20] - The weighted average yield at cost of the direct origination portfolio was 10.5%, down from 10.7% in the prior quarter [35] Company Strategy and Development Direction - The company is focused on lending to the core middle market on a first lien senior secured basis, which offers attractive risk-adjusted returns [22] - The reduction in exposure to Merx is expected to provide capital for deployment into first lien middle market loans, which are believed to deliver higher returns [17] - The company intends to redeploy capital repaid from Merx to enhance earnings power and strengthen dividend coverage [18] Management's Comments on Operating Environment and Future Outlook - Management noted that the M&A pipeline is building, with sponsors remaining active despite previous uncertainties [55] - The company expects a busy second half of the year with plenty of opportunities to deploy capital [55] - Management expressed confidence in covering the declared dividend of $0.38 per share through net investment income, despite potential base rate pressures [90] Other Important Information - The company reported total investment income of approximately $81.3 million, up 3.2% compared to the prior quarter [33] - Total principal debt outstanding was $2.05 billion, with total net assets standing at $1.3 billion [38] - The company received an $8.5 million pay down from Merx during the quarter [24] Q&A Session Summary Question: Can you clarify the structure of the remaining investment in Merx? - The remaining investment consists of four aircraft and a servicing platform, with 40% of the remaining exposure related to servicing contracts [43][44] Question: What are the expectations for investment activity in the second half of the year? - The company anticipates a busy second half with a growing M&A pipeline and active sponsors, which should provide ample opportunities for deployment [55] Question: How does the company view the current leverage levels? - The company is comfortable with the current leverage levels and expects them to remain within target ranges, especially with anticipated M&A activity [56][58] Question: What is the expected impact of the Merx transactions on NAV? - The Merx transactions are expected to result in a positive impact to NAV in the high single-digit per share range, specifically between $0.06 to $0.09 [94]

Financial Data and Key Metrics Changes - Adjusted net investment income was $0.36 per share, flat compared to the prior quarter [7] - Annualized net investment income ROE was 15.4% and net asset value per share was $9.18, down from $9.23 in the previous quarter [8] - Net realized losses for the quarter were approximately $41 million or $0.48 per share, primarily due to the disposition of investments [24] - Net unrealized gains totaled $30 million or $0.35 per share, reflecting reversals of previous losses [24] Business Line Data and Key Metrics Changes - The number of portfolio companies on nonaccrual status decreased to eight from twelve, representing 4.4% of the portfolio at fair value [8][25] - The portfolio had a fair market value of approximately $1.8 billion, invested across 146 companies [15] - 90% of the portfolio was invested in senior secured debt, with 94% of that amount being floating rate [16] Market Data and Key Metrics Changes - The weighted average annual effective yield of the portfolio was 12.2%, down from 12.4% in the previous quarter [16] - New investments had a weighted average yield of 11.4%, while exited investments had a yield of 11.2% [17] Company Strategy and Development Direction - The company is focused on investing in first lien loans and maintaining a diversified portfolio [20] - The strategy includes targeting core middle market companies and leveraging resources from the BlackRock platform [20] - The company aims to resolve remaining challenged positions within the portfolio and maintain a disciplined approach to loan origination [33][34] Management's Comments on Operating Environment and Future Outlook - The current market environment is characterized by tightened access to capital and higher financing costs [29] - The company believes the immediate impact from potential tariffs will be limited, estimating only a mid-single-digit percentage of the portfolio will be directly affected [30] - There is strong interest from borrowers for direct loans in the core middle market, which is the fastest-growing sector of the economy [31] Other Important Information - The Board declared a second quarter dividend of $0.25 and a special dividend of $0.04 per share [13] - The company repurchased 3,150 shares of TCP stock during the quarter and an additional 39,500 shares after the quarter end [13] Q&A Session Summary Question: What are the thoughts on the trajectory of share repurchases going forward? - The company will continue to monitor the trading price and repurchase shares when they are deemed accretive [38] Question: Do most portfolio companies have sponsors? - The majority of portfolio companies do have sponsors or institutional ownership, but decision-making often involves management teams [40] Question: What is the appetite of sponsors for injecting more equity in financing? - Sponsors have been supportive, but their willingness may decrease if equity values are not sustainable [42][43] Question: How long will it take to complete restructuring of the aggregators? - The company expects to complete restructurings in the next few quarters, with some positive signs of improvement [51] Question: What drove the markup for Job and Talent? - The markup was driven by improved performance and the provision of growth capital, which included enhanced economics for the company [62][67] Question: Are there plans to pursue new SBIC licenses? - The company is in the process of obtaining a second SBIC license, which is the maximum allowed [68]