BCP Investment Corp (BCIC) 2024 Q1 法說會逐字稿

Welcome to Portman Ridge Finance Corporation's first quarter 2024 earnings conference call. An earnings press release was distributed yesterday, May 8th after market close. A copy of the release along with an earnings presentation is available on the company's website at www.portmanridge.com in the Investor Relations section and should be reviewed in conjunction with the company's Form 10-Q filed yesterday with the SEC. As a reminder, this conference call is being recorded for replay purposes.

歡迎參加波特曼里奇金融公司 2024 年第一季財報電話會議。昨天（5 月 8 日）收盤後發布了一份收益新聞稿。該新聞稿以及收益報告的副本可在該公司網站 www.portmanridge.com 的投資者關係部分獲取，並應與該公司昨天向 SEC 提交的 10-Q 表格一併進行審查。謹此提醒，本次電話會議正在錄音以供重播之用。

Please note that today's conference call may contain forward-looking statements, which are not guarantees of future performance or results and involve a number of risks and uncertainties. Actual results may differ materially from those in forward-looking statements as a result of a number of factors, including those described in the company's filings with the SEC. Portman Ridge Finance Corporation assumes no obligation to update any such forward-looking statements unless required by law.

請注意，今天的電話會議可能包含前瞻性陳述，這些陳述不是對未來業績或結果的保證，並且涉及許多風險和不確定性。由於多種因素（包括該公司向美國證券交易委員會提交的文件中所述的因素），實際結果可能與前瞻性陳述中的結果有重大差異。除非法律要求，波特曼里奇金融公司不承擔更新任何此類前瞻性聲明的義務。

Speaking on today's call, will be Ted Goldthorpe, Chief Executive Officer, President and Director of Portman Ridge Finance Corporation; Brandon Satoren, Chief Financial Officer; and Patrick Schafer, Chief Investment Officer.

Portman Ridge Finance Corporation 執行長、總裁兼董事 Ted Goldthorpe 將在今天的電話會議上發表演說；布蘭登‧薩托倫，財務長；派崔克‧謝弗（Patrick Schafer），首席投資長。

With that, I would now like to turn the call over to Ted Goldthorpe, Chief Executive Officer of Portman Ridge. Please go ahead.

現在，我想將電話轉給波特曼·里奇執行長特德·戈德索普 (Ted Goldthorpe)。請繼續。

Good morning, and thanks, everyone, for joining our first quarter 2024 earnings call. I'm joined today by our Chief Financial Officer, Brandon Satoren, and our Chief Investment Officer, Patrick Schafer. I'll provide brief highlights on the company's performance and activities for the year, Patrick will provide commentary on our investment portfolio and our markets, and Brendan will discuss our operating results and financial condition in greater detail.

早安，感謝大家參加我們的 2024 年第一季財報電話會議。今天我們的財務長布蘭登·薩托倫 (Brandon Satoren) 和首席投資官帕特里克·謝弗 (Patrick Schafer) 也加入了我的行列。我將簡要介紹該公司今年的業績和活動，帕特里克將提供有關我們的投資組合和市場的評論，布倫丹將更詳細地討論我們的經營業績和財務狀況。

Yesterday, Portman Ridge announced its first quarter of 2024 results and following the strong earnings trajectory we saw in 2023, we are pleased with the solid solid earnings power of the portfolio. Despite operating under challenging market conditions, we reported net investment income of $6.2 million or $0.67 per share and net asset value of $210.6 million or $22.57 per share.

昨天，Portman Ridge 公佈了 2024 年第一季業績，繼我們在 2023 年看到的強勁盈利軌跡之後，我們對該投資組合的強勁盈利能力感到滿意。儘管在充滿挑戰的市場條件下運營，我們報告的淨投資收益為 620 萬美元，即每股 0.67 美元，淨資產價值為 2.106 億美元，即每股 22.57 美元。

We continue to target a well-diversified portfolio, with investments spread across 29 industries and 103 entities, while maintaining an average par balance per entity of $3.1 million. This compares to 27 industries and 100 entities with an average par balance per entity of $3.1 million at the end of 2023. Credit quality remained stable, with seven investments on non-accrual, representing 0.5% of the portfolio on a fair value basis. Additionally, we continue to believe our stock remains undervalued, and during the quarter we continued to repurchase shares under our repurchase program, purchasing 51,015 shares for an aggregate cost of $1 million. These repurchases had an accretive effect to Portman's net asset value of $0.02 per share, reinforcing our commitment to shareholder value. Further, the Board of Directors approved dividend for the second quarter of 2024 in the amount of $0.69 per share, which represents a strong 12.2% annualized return on net asset value, which is among the highest in the BDC space.

我們繼續以多元化的投資組合為目標，投資遍佈 29 個產業和 103 個實體，同時保持每個實體的平均票面餘額為 310 萬美元。相較之下，到 2023 年底，27 個產業和 100 個實體的平均面額餘額為 310 萬美元。信貸品質維持穩定，有 7 項非應計投資，以公允價值計算佔投資組合的 0.5%。此外，我們仍然認為我們的股票仍然被低估，並且在本季度我們繼續根據回購計劃回購股票，以總成本 100 萬美元購買 51,015 股。這些回購使波特曼的淨資產價值增加了每股 0.02 美元，強化了我們對股東價值的承諾。此外，董事會還批准了 2024 年第二季每股 0.69 美元的股息，這代表著 12.2% 的年化淨資產回報率，在 BDC 領域處於最高水平。

Turning to conditions in our primary market, as we previewed on our first quarter earnings call, M&A activity has picked up during the quarter and capital markets as a whole were extremely active as compared to the fourth quarter. Net deal activity, defined as new deals excluding corresponding repayments in the BSL loan market, was $57.2 billion, up 64% from the fourth quarter and represented the highest new net volume since first quarter of 2022 and is representative of the fundamental tailwinds we believe exist in our primary markets.

談到我們的一級市場狀況，正如我們在第一季財報電話會議上預覽的那樣，本季併購活動有所回升，整個資本市場與第四季相比極為活躍。淨交易活動（定義為BSL 貸款市場中不包括相應還款的新交易）為572 億美元，比第四季度增長64%，是2022 年第一季以來最高的新淨交易量，代表了我們認為存在的基本面推動因素在我們的主要市場。

For all of 2023, private equity firms have been sitting on record amounts of dry powder, while at the same time being pushed by LPs to return capital. Although expectations for future rate hikes have diminished towards the end of the first quarter and the beginning of the second quarter, we believe the aforementioned fundamentals, combined with positive economic outlook and sentiment, should continue to fuel new deal activity in our private credit space over the course of 2024. Specifically at Portman Ridge, and more generally across BC Partners' credit platform, we continue to find attractive opportunities both through our sponsor relationships and our focus on non-sponsor or nontraditional sponsor-backed companies and continue to win transactions based on our ability to custom tailor a capital solution for the borrower and the borrowers' belief that our platform can add value to their businesses, over and above just being a capital provider.

2023 年全年，私募股權公司坐擁創紀錄數量的乾火藥，同時又受到有限合夥人的推動返還資本。儘管對未來升息的預期在第一季末和第二季初有所減弱，但我們認為上述基本面，加上積極的經濟前景和情緒，應會繼續推動我們私人信貸領域的新交易活動超過2024年的過程。特別是在Portman Ridge，更廣泛地說，在BC Partners 的信貸平台上，我們繼續透過我們的贊助商關係以及我們對非贊助商或非傳統贊助商支持的公司的關注來尋找有吸引力的機會，並根據我們定制的能力繼續贏得交易為借款人量身定制資本解決方案，讓借款人相信我們的平台不僅可以作為資本提供者，還可以為其業務增加價值。

Our strategy has always been to be very selective on new investment opportunities, focusing on portfolio management and risk mitigation. To that point, during the quarter, we made investments into only one new portfolio company. Our goal continues to be the further diversification of our portfolio by investing in companies that have the potential to provide high returns for our shareholders.

我們的策略始終是對新的投資機會進行嚴格篩選，並專注於投資組合管理和風險緩解。到目前為止，在本季度，我們只投資了一家新的投資組合公司。我們的目標仍然是透過投資有潛力為股東提供高回報的公司，進一步實現我們的投資組合多元化。

As we proceed further into 2024, our pipeline remains strong, and we believe we are well positioned to take advantage of new investment opportunities while also remaining diligent in our investment and capital deployment process.

隨著我們進一步邁向 2024 年，我們的管道仍然強勁，我們相信我們處於有利地位，能夠利用新的投資機會，同時在投資和資本部署過程中保持勤奮。

With that, I'll turn the call over to Patrick Schafer, our Chief Investment Officer, for our review of our investment activity.

接下來，我會將電話轉給我們的首席投資長 Patrick Schafer，以便我們審查我們的投資活動。

Thanks, Ted. Turning now to Slide 5 of our presentation and the sensitivity of our earnings to interest rates. As of March 31, 2024, approximately 91.1% of our debt securities portfolio were either fully in rate with the spread to an interest rate index such as SOFR or Prime, with substantially all these being linked to SOFR. As you can see from the chart, the underlying benchmark rates of our assets during the quarter lagged the prevailing market rates, and still remain below the SOFR rates as of April 29th, 2024. But between the market transition last year from LIBOR/SOFR and the pause from the Fed earlier this year, the gap has narrowed to the tightest it has been since the onset of the Fed rate hike cycle.

謝謝，泰德。現在轉向我們簡報的幻燈片 5 以及我們的收益對利率的敏感度。截至 2024 年 3 月 31 日，我們約 91.1% 的債務證券投資組合完全符合 SOFR 或 Prime 等利率指數的利差，其中幾乎所有這些都與 SOFR 掛鉤。從圖表中可以看出，本季我們資產的基礎基準利率落後於現行市場利率，截至 2024 年 4 月 29 日仍低於 SOFR 利率。但從去年市場從 LIBOR/SOFR 轉向到今年稍早聯準會暫停升息之間，差距已縮小至聯準會升息週期開始以來的最窄水準。

Skipping down to slide 10. Originations for the first quarter were higher than prior-year first quarter and were above repayment levels, resulting in net originations of approximately $1.7 million. Our new investments made during the quarter are expected to yield a spread to SOFR of 581 basis points on par value and the investments were purchased at a cost of approximately 98.4% of par.

跳到幻燈片 10。第一季的資金來源高於去年第一季度，高於還款水平，導致淨資金來源約為 170 萬美元。我們在本季進行的新投資預計將產生面額與 SOFR 581 個基點的利差，而這些投資的購買成本約為面額的 98.4%。

Our investment portfolio at the end of the first quarter remained highly diversified. We ended the year with investment spread across 29 different industries and 34 different borrowers, all while maintaining an average par balance per entity of approximately $3.1 million.

截至第一季末，我們的投資組合仍保持高度多元化。年底，我們的投資分佈在 29 個不同行業和 34 個不同借款人，同時每個實體的平均票面餘額保持在約 310 萬美元。

Turning to Slide 11. In aggregate, investments on non-accrual status remain relatively low at seven investments at the end of the first quarter 2024, representing 0.5% and 3.2% of the Company's investment portfolio at fair value and cost, respectively. This compares to December 31, 2023, where there were also seven investments on non-accrual status representing 1.3% and 3.2% of the Company's investment portfolio at fair value and cost, respectively.

轉到投影片 11。整體而言，截至 2024 年第一季末，非應計投資仍相對較低，有 7 項投資，分別占公司以公允價值和成本計算的投資組合的 0.5% 和 3.2%。相較之下，截至 2023 年 12 月 31 日，還有 7 項非應計投資，分別占公司以公允價值和成本計算的投資組合的 1.3% 和 3.2%。

On slide 12, excluding our non-accrual investments, we have an aggregate debt investment portfolio of $384 million at fair value, which represents a blended price of 93.7% of par and is 90% comprised of first lien loans based on par value. Assuming a par recovery, our March 31, 2024 fair values reflect a potential of $25.8 million of incremental net value, a 12.1% increase or $2.72 per share, excluding any recovery from the non-accrual investments. If we were to further overlay an illustrative 10% default rate and 70% recovery to the entire debt securities portfolio, again excluding non-accrual investments, the incremental NAV value potential would be $1.41 per share or a 6.2% increase to NAV per share as of March 31, 2024.

在投影片12 上，不包括我們的非應計投資，我們的債務投資組合總額以公允價值計算為3.84 億美元，相當於面額93.7% 的混合價格，其中90% 由基於面額的第一留置權貸款組成。假設票面價值恢復，我們 2024 年 3 月 31 日的公允價值反映了 2,580 萬美元增量淨值的潛力，成長 12.1% 或每股 2.72 美元，不包括非應計投資的任何恢復。如果我們進一步將說明性的10% 違約率和70% 回收率涵蓋到整個債務證券投資組合，再次排除非應計投資，則增量資產淨值潛力將為每股1.41 美元，或每股資產淨值增加6.2%，如下： 2024 年 3 月 31 日。

Finally, turning to Slide 13. If you aggregate the three portfolios acquired over the last three years, we have purchased a combined $434.8 million of investments, have realized approximately 82% of these positions at a combined realized and unrealized mark of 102% of fair value at the time of closing the respective mergers. As of Q1 2024, we had fully exited the acquired Oak Hill portfolio and are down to a combined $33.5 million of the acquired HCAP portfolio and the initial KCAP portfolio.

最後，轉向投影片 13。如果將過去三年收購的三個投資組合進行匯總，我們已購買了總計4.348 億美元的投資，並已實現了其中約82% 的頭寸，已實現和未實現的總金額為結算時公允價值的102%。截至 2024 年第一季度，我們已完全退出收購的 Oak Hill 投資組合，收購的 HCAP 投資組合和初始 KCAP 投資組合的總額降至 3,350 萬美元。

I'll now turn the call over to Brandon to further discuss our financial results for the period.

我現在將把電話轉給布蘭登，進一步討論我們這段時期的財務表現。

Thanks, Patrick. As Ted and Patrick previously mentioned, our results for the first quarter of 2024 continue to reflect the company's strong financial performance. Our total investment income for the quarter was $16.5 million, of which $14.2 million was attributable to interest income from the debt investment portfolio. This compares to total investment income for the fourth quarter of 2023 of $17.8 million, of which $15.3 million was attributable to interest income from the debt investment portfolio. The decrease was primarily driven by the reversal of $0.4 million or $0.04 per share of previously accrued unpaid interest on two portfolio companies placed on non-accrual during the first quarter of 2024, as well as lower pay-down income of $0.4 million or $0.04 per share during the quarter.

謝謝，派崔克。正如 Ted 和 Patrick 之前提到的，我們 2024 年第一季的業績繼續反映了公司強勁的財務表現。本季我們的總投資收入為 1,650 萬美元，其中 1,420 萬美元來自債務投資組合的利息收入。相較之下，2023 年第四季的總投資收入為 1,780 萬美元，其中 1,530 萬美元來自債務投資組合的利息收入。這一下降主要是由於2024 年第一季兩家投資組合公司之前應計未付利息40 萬美元（即每股0.04 美元）轉回非應計利息，以及預付收入減少40 萬美元（即每股0.04 美元）。

Excluding the impact of purchase price accounting, our core investment income for the quarter was $16.5 million, a decrease of $1.2 million compared to core investment income of $17.7 million in the prior quarter. Our net investment income for the quarter was $6.2 million, or $0.67 per share. This compares to $11.2 million or $1.18 per share for the prior quarter. The decrease in net investment income was the result of lower investment income and $0.1 million or $0.01 per share of incremental expenses in the first quarter, as well as a onetime expense reimbursement from the company's investment advisor during the prior quarter. As of March 31, 2024 and December 31, 2023, the weighted average contractual interest rate on our interest-earning debt investment portfolio was approximately 12.1% and 12.5%, respectively. We continue to believe the portfolio remains well-positioned to generate incremental revenue in future quarters due to the current rate environment.

排除購買價格會計的影響，我們本季的核心投資收入為 1,650 萬美元，比上一季的核心投資收入 1,770 萬美元減少了 120 萬美元。本季我們的淨投資收益為 620 萬美元，即每股 0.67 美元。相比之下，上一季為 1,120 萬美元，即每股 1.18 美元。投資淨收益減少的原因是第一季投資收益減少以及10萬美元或每股0.01美元的增量費用，以及上一季公司投資顧問的一次性費用報銷。截至2024年3月31日及2023年12月31日，生息債投資組合的加權平均合約利率分別約為12.1%及12.5%。我們仍然相信，由於當前的利率環境，該投資組合仍處於有利地位，可以在未來幾季產生增量收入。

Total expenses for the quarter ended March 31, 2024 were $10.3 million compared to total expenses of $11.9 million for the fourth quarter of 2023. The decrease was largely driven by a lower incentive fee as well as lower interest and financing costs, as a result of lower average leverage during the quarter.

截至 2024 年 3 月 31 日的季度總費用為 1,030 萬美元，而 2023 年第四季的總費用為 1,190 萬美元。這一下降主要是由於本季平均槓桿率較低而導致激勵費降低以及利息和融資成本降低。

Our net asset value as of March 31, 2024 was $210.6 million or $22.57 per share, a decrease of $0.19 per share as compared to the prior-quarter net asset value of $213.5 million or $22.76 per share The decrease was largely driven by our dividend exceeding net income for the quarter ended March 31, 2024.

截至2024 年3 月31 日，我們的淨資產值為2.106 億美元，即每股22.57 美元，與上一季淨資產價值2.135 億美元，即每股22.76 美元相比，每股減少0.19 美元。一下降主要是由於我們的股息超過截至 2024 年 3 月 31 日的季度淨利潤。

Turning to the liability side of the balance sheet. As of March 31, 2024, the company had a total of $291.7 million of borrowings outstanding, with a weighted average interest rate of 6.9%. This balance was comprised of $92 million in borrowings under our senior secured revolving credit facility, $108 million of 2026 notes and $91.7 million of 2018-2 secured notes due 2029.

轉向資產負債表的負債方。截至2024年3月31日，該公司未償還借款總額為2.917億美元，加權平均利率為6.9%。該餘額包括我們的優先擔保循環信貸額度下的 9,200 萬美元借款、1.08 億美元的 2026 年票據和 9,170 萬美元的 2029 年到期的 2018-2 年擔保​​票據。

We finished the quarter with $23 million of available borrowing capacity under the senior secured revolving credit facility. Accordingly, as of March 31, 2024, our gross and net leverage ratios were 1.4 times and 1.2 times, respectively. Compared to the prior quarter, gross leverage is down one full turn from 1.5 times and net leverage is flat. The decrease in gross leverage is largely driven by the paydown on the 2018-2 notes during the quarter. From a regulatory perspective, our asset coverage ratio as of quarter end was 171%.

本季末，我們在優先擔保循環信貸安排下擁有 2,300 萬美元的可用借款能力。因此，截至2024年3月31日，我們的總槓桿率和淨槓桿率分別為1.4倍和1.2倍。與上一季相比，總槓桿率從 1.5 倍下降了整整一圈，淨槓桿率持平。總槓桿率的下降主要是由於本季 2018 年第二期票據的還款所致。從監管角度來看，截至季末我們的資產覆蓋率為171%。

Finally, the Board approved a quarterly distribution of $0.69 per share payable on May 31, 2024 to stockholders of record at the close of business on May 21.

最後，董事會批准了每股 0.69 美元的季度分配，並將於 2024 年 5 月 31 日支付給 5 月 21 日收盤時在冊的股東。

With that, I will turn the call back over to Ted.

這樣，我會將電話轉回特德。

Thank you, Brandon. Ahead of questions, I'd like to reemphasize that we believe we are well-positioned to take advantage of the current market environment, as shown in the first quarter. Through a prudent investment strategy, we believe we will be able to deliver strong returns to our shareholders for the rest of 2024.

謝謝你，布蘭登。在提問之前，我想再次強調，我們相信我們已做好充分利用當前市場環境的準備，如第一季所示。透過審慎的投資策略，我們相信我們將能夠在 2024 年剩餘時間內為股東帶來豐厚的回報。

Thank you once again to all our shareholders for your ongoing support. This concludes our prepared remarks, and I'll turn the call over for any questions.

再次感謝所有股東一直以來的支持。我們準備好的演講到此結束，如果有任何問題，我將轉接電話。

Thank you. We will now begin the question-and-answer session. (Operator Instructions) Your first question comes from the line of Christopher Nolan. Please go ahead.

謝謝。我們現在開始問答環節。（操作員說明）您的第一個問題來自克里斯多福諾蘭。請繼續。

The slowdown in the growth of the portfolio -- is the strategy now simply to make new investments to offset the prepays? So in other words, the amount of money that you put up to work in new investments is a function of how much you get back in terms of prepays that quarter?

投資組合成長放緩—現在的策略只是進行新投資來抵消預付款嗎？換句話說，您投入新投資的金額取決於您在該季度預付款項中收回的金額？

I think that's generally right, Chris. I do think kind of where we are in a net leverage basis, we're sort of at the low end of kind of our 1.25 to 1.4 times range. So I think there is -- we do have room and would look to kind of increase I'll call it assets, in addition to just I'll call it one in one out. But where we sit now, I think we are probably having a little bit more of a focus on what you just said, which is making sure we're replacing assets that have been repaid. We are kind of selectively reducing some of our liquid exposure, just given the run-up in the BSL market. It's not a lot, but we have probably eight or nine names that are quote-unquote, liquid in our book. So we would look to exit those positions at kind of attractive prices in the BSL market and then obviously have those proceeds to rotate into new private transactions.

我認為這基本上是正確的，克里斯。我確實認為我們的淨槓桿率處於 1.25 至 1.4 倍範圍的低端。所以我認為，我們確實有空間，並且會尋求某種增長，我將其稱為資產，此外，我將其稱為一進一出。但我們現在所處的位置，我認為我們可能會更專注於您剛才所說的內容，即確保我們更換已償還的資產。鑑於 BSL 市場的上漲，我們有選擇地減少了一些流動性曝險。雖然數量不多，但我們的書中可能有八、九個名字是引用不被引用的、流動的。因此，我們希望在 BSL 市場上以有吸引力的價格退出這些頭寸，然後顯然將這些收益用於新的私人交易。

So it's a mix of a couple of those things, but I would say we definitely feel like we have room to kind of be a net grower of the portfolio. But being mindful of where we are relative to our leverage guidelines. The guidelines -- the guidance.

所以這是這些因素的混合體，但我想說，我們絕對覺得我們有空間成為投資組合的淨成長者。但要注意我們相對於我們的槓桿指導方針的位置。指導方針——指導方針。

And then given that you're paying down the 2018 secured note, should we expect the bank revolver to pick up the slack to increase?

然後，考慮到您正在償還 2018 年的擔保票據，我們是否應該期望銀行左輪手槍能夠填補空缺並增加？

That's right. Where the revolver sits today, we're at about $92 million drawn or so. It has $115 million of total capacity and there's an incremental above and beyond that. But the very short answer is yes.

這是正確的。今天左輪手槍的位置，我們抽到了大約 9200 萬美元左右。它的總容量為 1.15 億美元，並且除此之外還有增量。但非常簡短的答案是肯定的。

Okay. And then I guess finally, Ted, can you give us a little color in terms of what you're seeing in terms of BDCs looking to be bought out? How has that market changed from your perspective?

好的。最後，我想，Ted，您能否為我們介紹一下您所看到的 BDC 尋求被收購的情況？從您的角度來看，這個市場發生了什麼樣的變化？

I would say these things tend to go in waves. I would say there's not a lot of logical partners for us today, just given who's out there and given what's happening. And I think higher interest rates have obviously helped the whole sector in terms of earnings and other things and obviously, credit quality has been stable. So I would say, as of now, I don't foresee a big wave of consolidation in the short term.

我想說這些事情往往會一波接一波。我想說，今天我們沒有很多合乎邏輯的合作夥伴，只是考慮到外面的人以及正在發生的事情。我認為較高的利率顯然對整個行業的盈利和其他方面有所幫助，而且顯然，信貸品質一直保持穩定。所以我想說，到目前為止，我預計短期內不會出現大的整合浪潮。

I'll get back in the queue. Thank you for answering my questions.

我會回到隊列中。感謝您回答我的問題。

(Operator Instructions) Our next question comes from the line of Deepak Sarpangal from Repertoire Partners. Please go ahead.

（操作員說明）我們的下一個問題來自 Repertoire Partners 的 Deepak Sarpangal。請繼續。

Thank you. Hi, Ted. Hi, Patrick. I guess given the first question you received, I have a different perspective on that. I actually just wanted to commend you on your fiduciary discipline to not simply grow the portfolio as some other managers do, since you get paid on overall assets. So I think it's actually great. You're recognizing that your stock is undervalued. When it makes sense to lean in and extending loans, you're doing it and when it doesn't, you're pulling back. So I think that's actually great.

謝謝。嗨，泰德。嗨，派崔克。我想考慮到您收到的第一個問題，我對此有不同的看法。實際上，我只是想讚揚您的信託紀律，不要像其他一些經理那樣簡單地擴大投資組合，因為您是根據整體資產獲得報酬的。所以我認為這實際上很棒。您意識到您的股票被低估了。當有必要採取行動並提供貸款時，你就會這樣做，而當沒有意義時，你就會退出。所以我認為這實際上很棒。

And then the question I had was I saw the new investment in Riddell, which I obviously know of the products, being a football fan. But I saw that you had like a broader partnership that you announced with BC Credit, BC Partners platform. Could you talk a little bit more about that new investment and just give us a little bit more context there?

然後我的問題是我看到了對 Riddell 的新投資，作為一名足球迷，我顯然了解這些產品。但我看到你們宣布與 BC Credit、BC Partners 平台建立更廣泛的合作關係。您能否多談談這項新投資，並為我們提供更多背景資訊？

Yes. I mean, we normally don't talk about individual investments, but this one specifically has been very high-profile.We have provided them financing. It closed right at quarter-end. And this is a perfect example of what we do, broadly speaking. So we have a Board seat with the company. We are very, very active in helping them with a number of different initiatives and it's a great business because there's a big recurring replacement cycle embedded in their business. So usually we don't have a big consumer franchise, but when we actually dig into the business itself, it's much less exposed to consumer discretionary spending. So yes, it is an investment across the whole platform and it's one of the advantages Portman gets as being part of a bigger platform, is to get access to deals like this.

是的。我的意思是，我們通常不會談論個人投資，但這項投資特別引人注目。它在季度末就關閉了。從廣義上講，這是我們所做工作的完美例子。所以我們在公司擁有一個董事會席位。我們非常非常積極地幫助他們實施許多不同的舉措，這是一項偉大的業務，因為他們的業務中有一個很大的經常性更換週期。因此，通常我們沒有大的消費者特許經營權，但當我們真正深入研究業務本身時，它受到消費者可自由支配支出的影響要小得多。所以，是的，這是一項跨整個平台的投資，波特曼作為更大平台的一部分所獲得的優勢之一，就是能夠獲得這樣的交易。

Got it. And then I couldn't tell for sure from the press releases, but to your point about the bigger platform, it almost sounded like you sourced it and brought it to the BC Partners platform rather than the other way round? Or did I get that mixed up?

知道了。然後我無法從新聞稿中確定，但就您關於更大平台的觀點而言，聽起來幾乎像是您購買了它並將其帶到了 BC Partners 平台，而不是相反？還是我搞混了？

No, that's fair. I mean, I mean, we obviously have a lot of our own captive sourcing here. So we sourced it and quite frankly, we've been working on it for -- we've been cultivating the management team for probably five years before the close.

不，這很公平。我的意思是，我的意思是，我們顯然在這裡有很多自己的自備採購。所以我們找到了它，坦白說，我們一直在努力——在交易結束之前，我們已經培養管理團隊大約五年了。

That's great. And then, is EBSC Holdings related to this? Or is that a separate investment?

那太棒了。那麼，EBSC Holdings 是否與此有關？或者這是一項單獨的投資？

No, it's the same. So the investment -- the combined investment was structured as again round numbers, sort of 65% first-lien secured loan and 35% preferred equity investment or structured equity investment in the business. And so for again, Portman as an example, they have a weighting between the two, but that you could think of as the same as I think the loan, the borrowers technically for Dell, Inc. and then the preferred equity, [SE] is technically EBSC, but that's just up at the parent company of Riddell.

不，是一樣的。因此，投資－合併投資的結構再次為整數，即 65% 的第一留置權擔保貸款和 35% 的優先股權投資或企業的結構性股權投資。因此，再次以波特曼為例，他們在兩者之間有一個權重，但你可以將其視為與我認為的貸款相同，技術上是戴爾公司的借款人，然後是優先股，[SE ]從技術上講，它是 EBSC，但這只是 Riddell 母公司的事。

Got it. And I suspect that preferred equity must be convertible into common rate.

知道了。我懷疑優先股必須可以轉換為普通利率。

It does have the potential to convert at certain metrics, yes.

是的，它確實有潛力在某些指標上轉換。

Okay. No, I figured, because the first lien loan looks great, right? It's like 11% cash pay first lien and then the preferred is 10% PIC. So I figured there must be a conversion feature to meet.

好的。不，我想，因為第一筆留置權貸款看起來很棒，對吧？這就像 11% 現金支付第一留置權，然後首選是 10% PIC。所以我想一定有轉換功能可以滿足。

That's right. Our expectation is overall return on that instrument would be meaningfully higher than 10%. But for accounting purposes, that's what we would otherwise be reflecting, you know, until until there was some sort of catalyst.

這是正確的。我們的預期是該工具的整體回報率將顯著高於 10%。但出於會計目的，這就是我們本來會反映的，你知道，直到出現某種催化劑。

Okay, great. I mean, to me, it seems like generally more of the same good stuff, seemed to check off my key boxes. You've got low and declining non-accruals, deleveraging, paying down debt, seemed like an even higher mix of senior secured loans this quarter while working off the CLO and joint venture stuff and then more accretive buybacks, another nice dividend. So appreciate the solid execution and the leadership. Look forward to keeping that going. Thank you.

好的，太好了。我的意思是，對我來說，似乎通常都是同樣的好東西，似乎檢查了我的鑰匙箱。非應計項目較低且不斷下降，去槓桿化、償還債務，似乎是本季度高級擔保貸款的更高組合，同時還清了貸款抵押貸款和合資企業的費用，然後是更多的增值回購，這是另一項不錯的股息。因此，讚賞紮實的執行力和領導力。期待繼續保持下去。謝謝。

Thank you, Deepak, appreciate it.

謝謝你，迪帕克，很感激。

(Operator Instructions) Your next question comes from the line of Steven Martin. Please go ahead.

（操作員說明）您的下一個問題來自 Steven Martin。請繼續。

Hi, guys. So couple of questions. PIC - could you comment on PIC and what the trends have been? It looks like PIC is a higher percentage of total interest income recently?

嗨，大家好。有幾個問題。PIC - 您能否評論一下 PIC 及其趨勢？貌似最近PIC佔總利息收入的比例比較高？

Yes, sorry, I was just pulling up the number, Steve. I think probably some of that is driven by we had significantly lower payment income. So it might just look a little bit higher as a percentage because of that. Again, I'd say like the broad brush comment is we don't see a material change in sort of how we are going to market and PIC versus cash. There have been some competitors or you're seeing in our market a little bit some folks have been willing to offer like the 1st year, 12 to 18 months as a partial PIC option for borrowers. It's kind of like a trying to win a deal that's not particularly prevalent candidly, but it is sort of out there every every once in a while. But broadly speaking, we don't see material changes in our cash versus PIC mix in kind of how we think about portfolio construction.

是的，抱歉，我只是撥打電話，史蒂夫。我認為其中部分原因可能是我們的支付收入顯著降低。因此，它的百分比可能看起來更高一些。再說一遍，我想說的是，我們沒有看到我們的行銷方式以及 PIC 與現金的方式發生重大變化。有一些競爭對手，或者您在我們的市場上看到一些人願意為借款人提供第一年、12 至 18 個月的部分 PIC 選項。這有點像是試圖贏得一筆交易，雖然坦白說並不特別普遍，但每隔一段時間就會出現這種情況。但總的來說，我們認為我們的現金與 PIC 組合並沒有發生重大變化，就像我們對投資組合建構的看法一樣。

Okay. On Slide 10, you made the comment that you only added one new portfolio company, yet purchases and draws were almost $39 million or $39 million. All the rest of that was existing portfolio companies and drawdowns on delayed terms?

好的。在投影片 10 上，您評論說您只添加了一家新的投資組合公司，但購買和提取的金額幾乎為 3900 萬美元或 3900 萬美元。其餘的都是現有的投資組合公司和延遲提領的資金嗎？

Yes, that's right. It's a combination -- again, we had some revolvers, delayed-draw term loans in existing -- all in existing borrowers and we had one, you know, new security, if you will, that wasn't like a previously committed DDTL, but in existing borrowers. So yes, again, broadly speaking, that is all from kind of the existing base. We'll probably have -- I don't know the exact number but we'll probably have two or three new borrowers this quarter just cause some activity in April and May. But yes, but my statement is correct and what you see there is activity within our existing portfolio.

恩，那就對了。這是一個組合——同樣，我們有一些左輪手槍、現有的延遲提取定期貸款——所有這些都在現有借款人中，我們有一個，你知道，新的證券，如果你願意的話，這不像以前承諾的DDTL，但在現有借款人中。所以，是的，從廣義上講，這都是來自現有基礎的。我們可能會——我不知道確切的數字，但本季度我們可能會有兩到三個新借款人，這只會導致四月和五月的一些活動。但是，是的，但我的說法是正確的，您所看到的我們現有投資組合中存在活動。

Okay. And that you started to comment on the current quarter. Can you make any comments about what you're expecting in terms of portfolio activity and your portfolio size versus the first quarter?

好的。您開始對當前季度發表評論。您能否對與第一季相比的投資組合活動和投資組合規模的預期發表評論？

Yes. No, appreciate it. So again, kind of similar to what we had said last quarter, I think, and what kind of I had alluded to when Chris Nolan asked the question. I think overall we would kind of expect to be sort of on the margin a net deployer but kind of again, it depends a little bit on timing of certain things. Like as an example, for this quarter, we were up, a little under $2 million from net deployments on both the Riddell transaction closed at the end of the quarter. And so if that had been pushed two days, it would have looked like we were, you know, $6.5 million or $7 million of, you know, net receiver of capital. So some of it depends a little bit on timing, but I think on the margin you would expect us to -- we would expect to be flat or slightly growing, let's say over the course of the year, Steve, and whether it falls kind of a little bit around the edge of a quarter might be a plus or minus here or there, but we kind of generally would view ourselves as a marginal net deployer of capital this year.

是的。不，欣賞它。再說一遍，我認為這與我們上季度所說的類似，以及克里斯諾蘭問這個問題時我所提到的。我認為總的來說，我們希望成為一個網路部署者，但同樣，這在一定程度上取決於某些事情的時間安排。舉個例子，本季度，我們在本季末完成的 Riddell 交易的淨部署中增加了略低於 200 萬美元。因此，如果這項計劃推遲兩天，那麼看起來我們將獲得 650 萬美元或 700 萬美元的淨資本接收者。所以其中一些取決於時間，但我認為在邊際上你會期望我們 - 我們預計會持平或略有增長，讓我們說在這一年中，史蒂夫，以及它是否會下降季度邊緣的一點點可能會在這裡或那裡產生正負，但我們通常將自己視為今年資本的邊際淨部署者。

Got it. Slide 11, non-accruals, the number of investments didn't change. The costs didn't change. I haven't had a chance to go through the whole portfolio from the Q, but the fair value changed?

知道了。第 11 張投影片，非應計項目，投資數量沒有變動。成本沒有改變。我還沒有機會從 Q 開始查看整個投資組合，但公允價值改變了？

Yes, a lot of this was driven by probably one security being marked down. You can even ultimately look through, it's a second lien security in [Qualpec] USA, is the name of the borrower. But it's again, obviously, regardless of whether it is on accrual or not, we kind of go through from a fair value perspective. That's again, just a reflection of a markdown in a position that's on non-accrual.

是的，這很大程度是由於一種證券被降價所致。你甚至可以最終看一下，這是美國[Qualpec]的第二留置權證券，是藉款人的名字。但顯然，無論是否應計，我們都會從公允價值的角度來處理。這又是非應計部位降價的反映。

Okay. And where are you putting money out currently? Like the most recent deal you did or the most -- well, I guess you only did one new deal in the quarter, but where -- the pricing you're talking about on some of the new deals for the second quarter, what are you looking at?

好的。您目前將資金投入何處？就像你最近做的交易或最——好吧，我猜你在本季度只做了一筆新交易，但是——你所說的第二季度一些新交易的定價是什麼？ ？

No real big change. I mean, there's been a big, big, big delta between where large cap sponsor deals are getting done and where our market is. So like if you look at trends and covenants, if look at trends and spreads, they've really come in pretty dramatically for big LBOs, and they haven't really come in that much for us. Like there has been some spread compression, but not really that much. Our deployment really is in mostly two areas. It's really, our core sponsor finance first lien type stuff, which is still pricing at 12%, 13% yields. And then number two is we do have a big non-sponsor franchise, where we get paid a little bit more and help out the companies. So like Riddell kind of fits into that bucket because it's not a traditional deal. So again, we haven't really experienced spread compression in our portfolio and the impact of the opening up of markets and stuff has been much more muted and you can see there's been a big trend of DSLs being issued to take out direct loans. So if you look at our fee income, like it's never been lower. So again, like as as these loans approach maturity, fee income should pick up, but we haven't experienced the broad-based paydowns that you've seen the BSL market do.

沒有真正的大改變。我的意思是，大盤股贊助商交易的完成情況與我們的市場狀況之間存在著巨大、巨大、巨大的差異。因此，如果你看看趨勢和契約，如果看看趨勢和利差，它們對於大型槓桿收購來說確實非常顯著，但對我們來說並沒有真正帶來那麼多。就像有一些傳播壓縮，但實際上沒有那麼多。我們的部署實際上主要在兩個領域。實際上，我們的核心贊助商融資的是第一留置權類型的東西，其定價仍為 12%、13% 的收益率。第二點是我們確實擁有一個大型的非贊助商特許經營權，我們可以獲得更多的報酬並為公司提供幫助。所以像里德爾一樣適合這個類別，因為這不是傳統的交易。再說一次，我們的投資組合並沒有真正經歷過利差壓縮，市場和其他東西開放的影響要小得多，你可以看到發行 DSL 來獲取直接貸款的大趨勢。因此，如果你看看我們的費用收入，你會發現它從未如此低過。因此，隨著這些貸款接近到期，費用收入應該會增加，但我們還沒有經歷過像 BSL 市場那樣的廣泛的還款。

You actually just answered one of my questions, but assuming interest rates don't change much for the balance of the year, because at this point they're speculating one rate change and no one's sure if it's up or down. What would you expect to have on the unrealized line? Would you expect the portfolio to -- would you expect the mark-to=market to increase, decrease, stay sort of where it is?

您實際上只是回答了我的一個問題，但假設利率在今年剩餘時間內不會發生太大變化，因為此時他們正在猜測利率變化，但沒有人確定它是上升還是下降。您希望未實現的線路上有什麼？您是否期望投資組合—您是否期望以市價計價會增加、減少、維持在原位？

So, good question, Steve. I'm just trying to think this through. It would depend a little bit more on where deals are getting done, obviously. And so there's kind of like two or three downstream effects, which is, if -- I would say the bigger driver of whether we have -- of how we have movement is probably a little bit more of the M&A market and maybe that is like a derivative of the interest rate environment. But where we are today, there's not a massive amount of M&A. It's picking up but obviously off of a pretty low base. So there was a lot more activity this quarter, but off of an incredibly low base for probably the last three quarters of 2023. And so with that as kind of like the backdrop, it's been somewhat competitive in our market, which has led to again DSL prices declining, decreasing and even private -- again, on the higher side, but private market spreads also compressing, which is kind of like independent a little bit of interest rates, not directly correlated to interest rates. So it's tough to answer. But say, if M&A remains sort of somewhat muted this year because of interest rates, I would say on the margin, we would have unrealized gains because that would probably lead to a continued spread compression and therefore pricing increases. But it's not -- at least in our portfolio, it's not exactly a direct line between interest rate hikes or declines and the price of our portfolio.

所以，好問題，史蒂夫。我只是想把這個問題想清楚。顯然，這更多地取決於交易在哪裡完成。因此，有兩到三個下游效應，也就是說，如果——我想說，我們是否有——我們如何進行運動的更大驅動因素可能更多的是併購市場，也許就像利率環境的衍生品。但就目前情況而言，並沒有大量的併購活動。它正在回升，但顯然是在相當低的基數基礎上的。因此，本季的活動較多，但 2023 年最後三個季度的基數可能非常低。因此，在這種背景下，我們的市場存在一定程度的競爭，這導致 DSL 價格再次下降、下降，甚至私有化——同樣，價格偏高，但私有市場價差也在壓縮，這是有點像獨立的一點利率，與利率不直接相關。所以很難回答。但是，如果今年的併購由於利率的原因而保持某種程度的低迷，我想說的是，我們將獲得未實現的收益，因為這可能會導致利差持續壓縮，從而導致定價上漲。但事實並非如此——至少在我們的投資組合中，利率上升或下降與我們投資組合的價格之間並不完全存在直接關聯。

All right. Thanks.

好的。謝謝。

Thank you. We have no further questions. Please continue.

謝謝。我們沒有其他問題了。請繼續。

We did have a question about our realized losses. Brandon, do you want to take that?

我們確實對已實現的損失有疑問。布蘭登，你想接受這個嗎？

Sure. So the primary driver of the realized losses during the period was one name in particular, that was restructured. It was HDC or Hostway. That drove the vast majority of the realized during the period.

當然。因此，這段時期已實現虧損的主要驅動因素是一個特別的名字，那就是重組。它是 HDC 或 Hostway。這推動了該時期絕大多數的實現。

Yes. So just really, really it's one restructured security that we still continue to hold. So anyway, thank you all for attending our call. As per always, please reach out with any questions. We're always happy to discuss with anyone and we look forward to speaking to you again in August for our second quarter conference call. Thank you very much.

是的。因此，實際上，這是我們仍然繼續持有的一種重組證券。無論如何，感謝大家參加我們的電話會議。一如既往，如有任何問題，請與我們聯繫。我們總是很樂意與任何人討論，並期待在八月再次與您交談，參加我們的第二季電話會議。非常感謝。

Ladies and gentlemen, that concludes today's call. Thank you all for joining, and you may now disconnect.

女士們、先生們，今天的電話會議到此結束。感謝大家的加入，現在可以斷開連線了。