Nuveen Churchill Direct Lending Corp. Announces First Quarter 2025 Results
Reports First Quarter Net Investment Income of $0.53 per Share
Declares Second Quarter Regular Distribution of $0.45 per Share
NEW YORK--(BUSINESS WIRE)--May 08, 2025--
Nuveen Churchill Direct Lending Corp. (NYSE: NCDL) ("NCDL" or the "Company"), a business development company externally managed by its investment adviser, Churchill DLC Advisor LLC (the "Adviser"), and by its sub-adviser, Churchill Asset Management LLC ("Churchill"), today reported financial results for the first quarter ended March 31, 2025.
Financial Highlights for the Quarter Ended March 31, 2025
-- Net investment income of $0.53 per share
-- Net realized and unrealized loss on investments of $(0.24) per share
-- Net increase in net assets resulting from operations of $0.29 per share
-- Net asset value ("NAV") per share of $17.96, compared to $18.18 per share
as of December 31, 2024
-- Paid first quarter regular distribution of $0.45 per share and the final
special distribution declared in connection with the IPO of $0.10 per
share on April 28, 2025, which represents a 12.4% total annualized
distribution yield based on the first quarter NAV per share
-- Declared second quarter regular distribution of $0.45 per share
"NCDL is off to a solid start in 2025, reflecting the continued strong performance of our investment portfolio", said Ken Kencel, President and Chief Executive Officer of NCDL and Churchill. "Our portfolio is highly diversified with an average position size of 0.5% and remains well-positioned with only 0.4% of the total portfolio on non-accrual status on a fair value basis at the end of the first quarter. In today's uncertain market environment, we remain focused on maintaining underwriting discipline, selectively investing in high-quality companies, and proactively managing our current portfolio."
"During the first quarter, we continued to optimize our balance sheet and capital structure by issuing $300 million of unsecured notes and refinancing one of our CLOs allowing us to reduce our borrowing costs going forward," said Shai Vichness, Chief Financial Officer of NCDL and Churchill. "We remain confident in the Company's positioning as a leader in the core, traditional middle market, and we remain focused on continuing to deliver an attractive yield to our shareholders."
Distribution Declaration
The Company's Board of Directors (the "Board") has declared a second quarter 2025 regular distribution of $0.45 per share payable on July 28, 2025 to shareholders of record as of June 30, 2025.
PORTFOLIO COMPOSITION
As of March 31, 2025, the fair value of the Company's portfolio investments was $2.08 billion across 210 portfolio companies and 26 industries. This compares to $2.08 billion as of December 31, 2024 across 210 portfolio companies and 27 industries.
As of March 31, 2025, the Company's portfolio based on fair value consisted of approximately 90.5% first-lien debt, 7.8% subordinated debt investments, and 1.7% equity investments. As of December 31, 2024, the Company's portfolio based on fair value consisted of 90.6% first-lien debt, 7.7% subordinated debt investments, and 1.8% equity investments.
As of March 31, 2025 and December 31, 2024, the weighted average Internal Risk Rating of the portfolio at fair value was 4.1 and 4.1 (4.0 being the initial rating assigned at origination), respectively. As of March 31, 2025, there were investments in two portfolio companies on non-accrual representing 1.0% of total investments at amortized cost (or 0.4% of total investments at fair value). As of December 31, 2024, there was an investment in one portfolio company on non-accrual status representing 0.4% of total investments at amortized cost (or 0.1% of total investments at fair value).
PORTFOLIO AND INVESTMENT ACTIVITY
For the three months ended March 31, 2025, the Company funded $153.0 million of portfolio investments and received $148.4 million of proceeds from principal repayments and sales, compared to $151.1 million and $119.5 million, respectively, for the three months ended December 31, 2024.
RESULTS OF OPERATIONS FOR THE FIRST QUARTER ENDED MARCH 31, 2025
Investment Income
Investment income increased to $53.6 million for the three months ended March 31, 2025 from $51.6 million for the three months ended March 31, 2024 primarily due to increased investment activity, offset by a decrease in the weighted average yield of our debt and income producing investments. As of March 31, 2025, the weighted average yield of debt and income producing investments decreased to 10.10% from 11.55% as of March 31, 2024, at cost, primarily due to overall tightening of spreads in new investments and the decline in base interest rates.
Net Expenses
Net expenses increased to $26.1 million for the three months ended March 31, 2025 from $21.9 million for the three months ended March 31, 2024, primarily due to an increase in interest and debt financing expenses and management fees. Interest and debt financing expenses increased due to higher average daily borrowings and the acceleration of deferred financing costs on the termination of the Wells Fargo Financing Facility and the CLO-I refinancing during the period. The increase in management fees was driven by the Company's increase in total assets. Under the terms of the advisory agreement, the Adviser waived the incentive fee on income and the incentive fee on capital gains for the first five quarters beginning with the calendar quarter in which the IPO was consummated (i.e. beginning with the calendar quarter ended March 31, 2024 through the calendar quarter ended March 31, 2025).
Net Realized Gain (Loss) and Net Change in Unrealized Gain (Loss) on Investments
For the three months ended March 31, 2025, the Company had a net realized gain on investments of $1.1 million compared to a net realized loss of $(3.6) million for the three months ended March 31, 2024. The net realized gain for the three months ended March 31, 2025 was primarily driven by realized gains from full or partial repayments and sales of investments in portfolio companies. The Company recorded a net change in unrealized loss of $(13.6) million for the three months ended March 31, 2025, compared to a net change in unrealized gain of $4.1 million for the three months ended March 31, 2024. The net change in unrealized loss for the three months ended March 31, 2025, primarily resulted from the underperformance of certain portfolio companies.
Financial Condition, Liquidity and Capital Resources
As of March 31, 2025, the Company had $49.2 million in cash and cash equivalents and $1.2 billion in total aggregate principal amount of debt outstanding. Subject to borrowing base and other conditions, the Company had approximately $172.8 million available for additional borrowings under its revolving credit facility, as of March 31, 2025. At March 31, 2025, the Company's debt to equity ratio was 1.31x (1.25x net debt to equity ratio) compared to 1.15x (1.10x net to debt equity ratio) at December 31, 2024.
CONFERENCE CALL AND WEBCAST INFORMATION
Nuveen Churchill Direct Lending Corp. will hold a conference call to discuss its first quarter 2025 financial results today at 11:00 AM Eastern Time. All interested parties may participate in the conference call by dialing (866) 605-1826 approximately 10-15 minutes prior to the call; international callers should dial +1 (215) 268-9877. Participants should reference Nuveen Churchill Direct Lending Corp. when prompted.
A live webcast of the conference call will also be available on the Events section of the Company's website at https://www.ncdl.com/news/events. A replay will be available under the same link following the conclusion of the conference call.
About Nuveen Churchill Direct Lending Corp.
Nuveen Churchill Direct Lending Corp. ("NCDL") is a specialty finance company focused primarily on investing in senior secured loans to private equity-owned U.S. middle market companies. NCDL has elected to be regulated as a business development company under the Investment Company Act of 1940, as amended. NCDL is externally managed by its investment adviser, Churchill DLC Advisor LLC, and by its sub-adviser, Churchill Asset Management LLC ("Churchill"). Both the investment adviser and sub-adviser are affiliates and subsidiaries of Nuveen, LLC ("Nuveen") the investment management division of Teachers Insurance and Annuity Association of America ("TIAA") and one of the largest asset managers globally. Churchill is a leading capital provider for private equity-backed middle market companies and operates as the exclusive U.S. middle market direct lending and private capital business of Nuveen and TIAA. Churchill is a registered investment advisor and majority-owned, indirect subsidiary of TIAA.
Forward-Looking Statements
This press release contains historical information and "forward-looking statements" with respect to the business and investments of NCDL, including, but not limited to, statements about NCDL's future performance and financial performance and financial condition, which involve substantial risks and uncertainties. Such statements involve known and unknown risks, uncertainties and other factors and undue reliance should not be placed thereon. These forward-looking statements are not historical facts, but rather are based on current expectations, estimates and projections about us, our current and prospective portfolio investments, our industry, our beliefs, and our assumptions. Words such as "anticipates," "expects," "intends," "plans," "will," "may, " "continue," "believes," "seeks," "estimates," "would," "could," "should," "targets," "projects," "outlook," "potential," "predicts" and variations of these words and similar expressions are intended to identify forward-looking statements. These statements are not guarantees of future performance and are subject to risks, uncertainties and
other factors, some of which are beyond NCDL's control and difficult to predict and could cause actual results to differ materially from those expressed or forecasted in the forward-looking statements including, without limitation, the risks, uncertainties and other factors identified in NCDL's filings with the Securities and Exchange Commission, including changes in the financial, capital, and lending markets; changes in the interest rate environment and its impact on NCDL's business, its financial condition and its portfolio companies; the uncertainty associated with the imposition of tariffs and trade barriers and changes in trade policy, and its impact on NCDL's portfolio companies and the general economy; general economic, political and industry trends and other external factors; the dependence of NCDL's future success on the general economy and its impact on the industries in which it invests; and other risks, uncertainties and other factors we identify in the section entitled "Risk Factors" in NCDL's most recent Annual Report on Form 10-K and most recent Quarterly Report on Form 10-Q, which are accessible on the SEC's website at www.sec.gov. Investors should not place undue reliance on these forward-looking statements, which apply only as of the date on which NCDL makes them. NCDL does not undertake any obligation to update or revise any forward-looking statements or any other information contained herein, except as required by applicable law.
CONSOLIDATED STATEMENTS OF ASSETS AND LIABILITIES
(dollars in thousands, except share and per share data)
March 31, 2025 December 31, 2024
---------------- ---------------------
Assets (Unaudited)
Investments
Non-controlled/non-affiliated
company investments, at fair
value (amortized cost of
$2,108,339 and $2,098,575,
respectively) $ 2,077,570 $ 2,081,379
Cash and cash equivalents 49,178 43,254
Restricted cash -- 50
Interest receivable 20,701 17,971
Derivative asset, at fair value
(Note 4) 8,184 --
Receivable for investments sold 16,563 1,024
Other assets 388 47
----------- --------------
Total assets $ 2,172,584 $ 2,143,725
----------- --------------
Liabilities
Debt (net of $10,315 and $6,668
deferred financing costs,
respectively, and net of
unamortized discount of $555 and
$0, respectively) (See Note 7) $ 1,199,570 $ 1,108,261
Payable for investments purchased 6,650 14,973
Interest payable 10,416 12,967
Management fees payable 3,914 3,956
Distributions payable 28,266 29,468
Directors' fees payable 156 128
Accounts payable and accrued
expenses 3,592 3,652
----------- --------------
Total liabilities $ 1,252,564 $ 1,173,405
----------- --------------
Commitments and contingencies
(See Note 8)
Net Assets: (See Note 9)
Common shares, $0.01 par value,
500,000,000 and 500,000,000
shares authorized, 51,217,252
and 53,387,277 shares issued and
outstanding as of March 31, 2025
and December 31, 2024,
respectively $ 512 $ 534
Paid-in-capital in excess of par
value 959,251 996,286
Total distributable earnings
(loss) (39,743) (26,500)
----------- --------------
Total net assets $ 920,020 $ 970,320
----------- --------------
Total liabilities and net
assets $ 2,172,584 $ 2,143,725
=========== ==============
Net asset value per share (See
Note 11) $ 17.96 $ 18.18
=========== ==============
CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)
(dollars in thousands, except share and per share data)
Three Months Ended March 31,
----------------------------------
2025 2024
------------ -----------
Investment income:
Non-controlled/non-affiliated
company investments:
Interest income $ 50,846 $ 49,078
Payment-in-kind interest income 2,365 1,992
Dividend income -- 308
Other income 375 217
------------ -----------
Total investment income 53,586 51,595
------------ -----------
Expenses:
Interest and debt financing expenses 20,643 16,941
Management fees (See Note 6) 3,914 3,264
Incentive fees on net investment
income 2,253 4,459
Professional fees 493 710
Directors' fees 156 128
Administration fees (See Note 6) 586 542
Other general and administrative
expenses 342 277
------------ -----------
Total expenses before
incentive fees waived 28,387 26,321
Incentive fees waived (See
Note 6) (2,253) (4,459)
------------ -----------
Net expenses after incentive
fees waived 26,134 21,862
------------ -----------
Net investment income 27,452 29,733
============ ===========
Realized and unrealized gain (loss)
on investments:
Net realized gain (loss) on
non-controlled/non-affiliated
company investments 1,103 (3,625)
Net change in unrealized
appreciation (depreciation):
Non-controlled/non-affiliated
company investments (13,573) 4,057
Income tax (provision) benefit 39 (141)
------------ -----------
Total net change in unrealized
gain (loss) (13,534) 3,916
------------ -----------
Total net realized and
unrealized gain (loss) on
investments (12,431) 291
------------ -----------
Net increase (decrease) in net
assets resulting from
operations $ 15,021 $ 30,024
============ ===========
Per share data:
Net investment income per share -
basic and diluted $ 0.53 $ 0.56
============ ===========
Net increase (decrease) in net
assets resulting from operations
per share - basic and diluted $ 0.29 $ 0.57
============ ===========
Weighted average common shares
outstanding - basic and diluted 52,211,340 52,758,353
============ ===========
PORTFOLIO AND INVESTMENT ACTIVITY (UNAUDITED)
(dollars in thousands)
Three Months Ended March 31,
------------------------------------
2025 2024
----------- --- ---------
Net funded investment activity
New gross commitments at par (1) $ 166,239 $ 206,815
Net investments funded 153,019 204,330
Investments sold or repaid (148,350) (54,896)
----------- ---------
Net funded investment activity $ 4,669 $ 149,434
----------- --- ---------
Gross commitments at par (1)
First-Lien Debt $ 151,995 $ 201,005
Subordinated Debt 13,230 5,314
Equity Investments 1,014 496
----------- --- ---------
Total gross commitments $ 166,239 $ 206,815
----------- --- ---------
Portfolio company activity
Portfolio companies, beginning of
period 210 179
Number of new portfolio companies 12 23
Number of exited portfolio
companies (12) (7)
----------- ---------
Portfolio companies, end of
period 210 195
----------- --- ---------
Count of investments 490 414
Count of industries 26 26
New investment activity
Weighted average annual interest
rate on new debt investments at
par 9.38% 10.27%
Weighted average annual interest
rate on new floating rate debt
investments at par 9.10% 10.20%
Weighted average spread on new
floating rate debt investments
at par 4.81% 4.87%
Weighted average annual coupon on
new fixed rate debt investments
at par 12.57% 13.85%
(1) Gross commitments at par includes unfunded investment commitments.
See Notes to Consolidated Financial Statements
View source version on businesswire.com: https://www.businesswire.com/news/home/20250508924635/en/
CONTACT: Investors:
Investor Relations
NCDL-IR@churchillam.com
Media:
Prosek Partners
Madison Hanlon
Pro-churchill@prosek.com
4475095
(END) Dow Jones Newswires
May 08, 2025 07:15 ET (11:15 GMT)
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