Financial Data and Key Metrics Changes - For Q3 2025, the company generated net investment income and adjusted net investment income of $0.57 per share, slightly below public guidance of approximately $0.58 and $0.57 per share respectively [8] - The net asset value increased to $21.99 per share from $21.93 at the end of Q2 2025 [26] - Total investment income was $373 million, a decrease of $25 million compared to Q2 2025, primarily due to lower interest income [23] Business Line Data and Key Metrics Changes - The company originated approximately $1.1 billion of new investments in Q3 2025, with 60% focused on add-on financings to existing portfolio companies [16] - New investments consisted of 65% in first lien loans, 7% in subordinated debt, 15% in asset-based finance investments, and 12% in capital calls to the joint venture [16] - The weighted average yield on accruing debt investments was 10.5%, a decrease of 10 basis points from the previous quarter [22] Market Data and Key Metrics Changes - The number of deals evaluated in Q3 increased by approximately 30% year over year, indicating a building momentum in M&A activity [12] - The portfolio companies reported a weighted average year-on-year EBITDA growth rate of approximately 4% [17] - Non-accruals represented 5% of the portfolio on a cost basis, down from 5.3% in Q2 2025 [19] Company Strategy and Development Direction - The company plans to implement a forward dividend strategy starting in Q1 2026, targeting an annualized yield of approximately 10% on net asset value [10] - The focus remains on U.S.-based direct lending and top-of-the-capital structure risk, with asset-based finance investments as a complementary part of the portfolio [14] - The company is actively monitoring tariff-related exposures and has low single-digit exposure to U.S. government-related borrowers [13] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the resilience of the BDC industry, noting that many companies successfully navigated previous periods of volatility [5] - The expectation is that the Federal Reserve will continue to reduce rates, which will be beneficial for portfolio companies and likely generate additional M&A activity [6] - Management acknowledged pockets of weakness in economic indicators but noted a healthy labor market supported by solid corporate earnings [12] Other Important Information - The company issued $400 million of unsecured notes due 2031, which were swapped to floating rate [28] - As of September 30, available liquidity was $3.7 billion, with gross and net debt-to-equity levels at 120% and 116% respectively [28] Q&A Session Summary Question: Improvement on legacy names and exit strategy - Management noted progress in restructuring efforts and expressed optimism about monetizing certain investments [33] Question: Progress on spillover and potential special distributions - Management indicated they expect to clean out a little over $100 million of spillover by year-end and may consider a one-time distribution in the first half of next year [35] Question: Dividend policy and resilience in various economic cycles - Management confirmed confidence in the base distribution level, considering various economic factors and forward curves [52] Question: Competitive factors in asset-based finance due to recent defaults - Management stated that recent defaults have not significantly impacted their competitive position, as they have avoided heavy cyclical businesses [74]