Cion Investment Corp (CION) 2023 Q4 法說會逐字稿

Good morning, and welcome to Cyan Investment Corporation's Fourth Quarter and Year End 2023 earnings conference call and earnings press release distributed earlier this morning before market opened a copy of the release along with a supplemental earnings presentation, is available on the Company's website at w. w. w. dot Xi'an BDC. dot com in the Investor Relations in the investor resources section and should be reviewed in conjunction with the company's Form 10 Q filed with the SEC. As a reminder, this call is being recorded for replay purposes.

早安，歡迎參加 Cyan Investment Corporation 的 2023 年第四季度和年終收益電話會議以及今天早上開市前發布的收益新聞稿。該新聞稿的副本以及補充收益演示可在該公司網站上獲取：w. w。 w。點西安BDC。 dot com 位於投資者資源部分的投資者關係中，應與公司向 SEC 提交的 10 Q 表格一起進行審查。謹此提醒，本次通話將會被錄音以供重播。

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 the forward-looking statements as a result of a number of factors, including those described in the Company's filings with the SEC.

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。

Speaking on today's call will be Michael Reznor guy on investment corporation's Co-Chief Executive Officer, Greg President, President and Chief Investment Officer, and Keith Pratt, Chief Financial Officer. With that, I would now like to turn the call over to Michael Rasmussen. Please go ahead, Michael.

投資公司聯席執行長 Michael Reznor Guy、總裁兼首席投資長 Greg 以及財務長 Keith Pratt 將在今天的電話會議上發言。現在，我想將電話轉給邁克爾·拉斯穆森。請繼續，邁克爾。

Thank you. Good morning, everyone. And thank you for joining us. As mentioned, I'm joined today by Greg and Keith as well as other members of senior management. I will start our call today with an overview of our fourth quarter and year-end results. Greg will review our investment activity during the quarter, and Keith will provide additional detail on our financial results. After his prepared remarks, we will open the call to questions.

謝謝。大家，早安。感謝您加入我們。如前所述，今天格雷格和基斯以及其他高階管理層成員也加入了我的行列。我將在今天的電話會議開始時概述我們的第四季和年終業績。格雷格將審查我們在本季度的投資活動，基思將提供有關我們財務業績的更多詳細資訊。在他準備好發言後，我們將開始提問。

As we reported this morning, we had a very strong fourth quarter and 2023 overall, which saw us continue to demonstrate solid credit performance with an increase of almost 3% to our net asset value quarter over quarter and almost 2% year over year and net income of $0.94 per share, an increase of 8% quarter over quarter.

正如我們今天早上報道的那樣，我們第四季度和2023 年整體表現非常強勁，我們繼續展現出穩健的信貸表現，我們的資產淨值環比增長近3%，同比增長近2%，淨資產值同比增長近2%。每股收益 0.94 美元，季增 8%。

Our ROE was 23.4% for the quarter and 11% for the year. Our net investment income ROE was 10% for the quarter and 12.1% for the year. Our net investment income of $0.40 per share, once again outearned our base dividend because of our continued ability to outgrow our base dividends, coupled with our ability to drive returns by our yield, enhancing features and opportunistic buying of lightly syndicated deals at discounts, which Greg will speak more about.

我們本季的 ROE 為 23.4%，全年為 11%。本季我們的淨投資收益 ROE 為 10%，全年為 12.1%。我們每股0.40 美元的淨投資收入再次超過了我們的基本股息，因為我們有能力持續成長，超過我們的基本股息，加上我們透過收益率推動回報的能力、增強功能以及以折扣價機會主義購買輕度銀團交易，這格雷格將詳細講述。

We are announcing today, our intention to declare a midyear supplemental dividend payable July 12th to shareholders of record as of June 28th. Exact amount of the supplemental dividends will be announced next quarter, our portfolio continued to deliver resilient credit performance as the percentage of our portfolio on nonaccrual is now below 1% of fair value, perhaps an even better indication of our credit performance. The percentage of names that we have risk rated 4 or 5, which represents our higher credit risk names, is also below 1% of the portfolio at fair value which compares favorably to many other BDCs. 99% of our book is risk rated 3 or higher. Again, a favorable benchmark when looking at our peers.

我們今天宣布，我們打算宣布將於 7 月 12 日向截至 6 月 28 日登記在冊的股東派發年中補充股息。補充股息的具體金額將於下季度公佈，我們的投資組合繼續提供有彈性的信用表現，因為我們的投資組合中非應計利息的百分比目前低於公允價值的1%，這也許更好地表明了我們的信用表現。我們的風險評級為 4 或 5 級（代表我們較高信用風險的名稱）的名稱百分比也低於以公允價值計算的投資組合的 1%，這與許多其他 BDC 相比是有利的。我們書中 99% 的風險評級為 3 或更高。再次，在我們的同行中，這是一個有利的基準。

At quarter end, we were still levered conservatively on a net basis at 1.1 times, our net asset value increased to $0.43 per share to $16.23. I would impart to mark-to-market adjustments to the portfolio as well as the accretive nature of our share repurchase program. Our NAV continues its recent improvement. It is now back to where it was two years ago. Despite the higher interest rate environment, we have and operate them and compares favorably with the net asset values of our peers, which have mostly experienced decreasing to flat net asset values over the same period.

截至季末，我們的淨資產槓桿率仍然保守地為 1.1 倍，我們的資產淨值增至每股 0.43 美元，達到 16.23 美元。我將介紹投資組合的按市價調整以及我們的股票回購計劃的增值性質。我們的資產淨值繼續近期的改善。現在又回到了兩年前的水平。儘管利率環境較高，但我們擁有並經營這些資產，並且與同業的資產淨值相比處於有利地位，而同業的資產淨值大多在同一時期下降至持平。

During Q4, we repurchased approximately 280,000 shares at an average price of $10.35 per share for a total repurchase amount of $2.9 million. We have repurchased a total of approximately 2.8 million shares for a total repurchase amount of $27 million since the beginning of the repurchase program we put in place in August 2022 through the end of 2023. And we intend to continue to be active, repurchasing our shares in the coming quarters. While many consider this the golden age of private credit or more of our BDC peers continue to depart from their traditional niche of lending to true middle market companies as banks retrenched in 2023.

第四季度，我們以每股 10.35 美元的平均價格回購了約 28 萬股股票，回購總額為 290 萬美元。自 2022 年 8 月實施回購計畫以來，到 2023 年底，我們已回購了總計約 280 萬股股票，回購總額為 2,700 萬美元。我們打算繼續積極行動，在未來幾季回購我們的股票。儘管許多人認為這是私人信貸的黃金時代，但隨著銀行在 2023 年緊縮開支，我們的更多 BDC 同行繼續偏離向真正的中間市場公司提供貸款的傳統利基。

However, as banks start to resume lending activity, we believe that having a defensible niche in the middle market is paramount. As I mentioned last quarter, many BDCs are going after larger companies where leverage is higher, spreads are lower and covenants even presence are looser to that end. Just recently, a Bloomberg article was titled, quote, private credit cuts, pricing to fend off Wall Street deal grab and quotes as many large BDCs participated in a loan with a spread of only 475 basis points over the base rate with 1.5% OID, one of the cheapest private credit deals in recent memory.

然而，隨著銀行開始恢復貸款活動，我們認為在中間市場擁有可防禦的利基市場至關重要。正如我上個季度提到的，許多 BDC 正在追求槓桿率更高、利差更低、甚至有更寬鬆的大型公司。就在最近，彭博社的一篇文章標題為“引用，私人信貸削減，定價以抵禦華爾街的交易搶奪”，並引用了許多大型BDC 參與的貸款，其利差僅比基準利率475 個基點，OID 為1.5%，近年來最便宜的私人信貸交易之一。

The company in question has an EBITDA of approximately $500 million. By comparison, the weighted average EBITDA of our portfolio is $34 million. We almost always receive meaningful lender protection than covenants. Our weighted average spread is 750 basis points over the base rate and our average OID is between to 2% and 3%.

該公司的 EBITDA 約為 5 億美元。相較之下，我們投資組合的加權平均 EBITDA 為 3,400 萬美元。我們幾乎總是得到比契約更有意義的貸款人保護。我們的加權平均利差比基本利率高 750 個基點，平均 OID 在 2% 到 3% 之間。

Well, there's nothing wrong in and of itself with the deal I referenced, we believe from a risk-adjusted perspective, our style of lending is superior. At almost $2 billion in total assets, we are large enough to be an impactful player to borrowers in the middle market without being so large that we are forced to by the market or sacrifice economics or borrower protections in an effort to put money to work.

嗯，我提到的交易本身沒有任何問題，我們相信從風險調整的角度來看，我們的貸款風格是優越的。我們的總資產接近20 億美元，我們的規模足夠大，足以成為中間市場借款人的有影響力的參與者，但又不會太大以至於我們被迫受到市場的影響或犧牲經濟或借款人保護來努力讓資金發揮作用。

Finally, before I turn the call to Greg, I wanted to announce that we are welcoming a new member to our senior management team this week as Charlie a rest here has joined us as a Managing Director and Head of Investor Relations. Charlie was previously part of IR team at Focus Financial Partners, and before that was an analyst at JP Morgan.

最後，在我打電話給格雷格之前，我想宣布，本週我們將歡迎一位新成員加入我們的高級管理團隊，查理在這裡休息，並作為董事總經理和投資者關係主管加入我們。Charlie 先前曾是 Focus Financial Partners 投資者關係團隊的一員，此前曾擔任摩根大通的分析師。

And with that, I'll now turn the call over to Greg.

現在，我將把電話轉給格雷格。

Thank you, Michael, and good morning, everyone. Our Q4 net investment income benefited from a diverse combination of the direct pass-through of higher floating interest rates from our loan assets, origination and amendment fees and other prepayment premiums and other yield-enhancing provisions embedded within our primarily first lien portfolio.

謝謝你，邁克爾，大家早安。我們第四季的淨投資收入受益於我們的貸款資產直接傳遞較高浮動利率、發起費和修改費以及其他預付款溢價以及嵌入我們主要第一留置權投資組合中的其他提高收益的條款的多種組合。

As Michael referenced, there remains a clear distinction between the increased levels of competition in the large cap markets between the larger asset management platforms and money center banks and the direct middle-market private credit sector where we strategically focus middle market. Direct lending sector remains robust and continues to take market share from the lower rated single-B syndicated markets, which is consistent with what we are experiencing with our platform as our private direct transaction sourcing remains vibrant, we continue to see attractive direct investment opportunities for which we remain highly selective.

正如麥可所提到的，大型資產管理平台和貨幣中心銀行之間的大盤市場競爭加劇與我們策略性關注中間市場的直接中間市場私人信貸部門之間仍然存在明顯的區別。直接貸款行業仍然強勁，並繼續從評級較低的單一B 銀團市場奪取市場份額，這與我們在平台上所經歷的情況一致，因為我們的私人直接交易採購仍然充滿活力，我們繼續看到有吸引力的直接投資機會我們仍然保持高度選擇性。

While M&A activity remained subdued in Q4, we saw an increase in refinancing opportunities, particularly in conjunction with add-on acquisitions where additional debt capital was required. That was beyond the capacity of the incumbent lender groups or the private equity sponsor chose to refinance to provide an additional two years to pursue M&A or sale strategies. We do expect M&A activity to increase in 2024 as we believe buyers and sellers are now accepting the higher for longer reality regarding interest rates.

儘管第四季度的併購活動仍然低迷，但我們看到再融資機會增加，特別是與需要額外債務資本的額外收購相結合。這超出了現有貸款集團或私募股權發起人的能力，選擇再融資以提供額外兩年的時間來實施併購或出售策略。我們確實預計 2024 年併購活動將會增加，因為我們相信買家和賣家現在正在接受利率長期較高的現實。

In addition, we continued to benefit from technically driven disruptions in the syndicated loan market where we acquire on lightly syndicated first lien loan tranches at significant discounts to par due to issues such as ratings changes, maturity extensions, exchanges or restructurings that are not suitable for the existing syndicate holders and where we can expect to have active roles in the processes that drive the refinancing or restructuring of the investments.

此外，我們繼續受益於銀團貸款市場技術驅動的混亂，由於評級變化、期限延長、交換或重組等不適合的問題，我們以較面值大幅折扣的價格購買了輕度銀團第一留置權貸款。現有的銀團持有人，以及我們期望在推動投資再融資或重組的過程中發揮積極作用。

We remain highly selective with new investments as we are still cautious with respect to the US consumer, particularly in light of recent global developments and the persistence of higher interest rates and inflation levels. We continue to strategic strategically focus on first lien investing and prefer to utilize yield enhancement provisions such as pick features, call protection, make-whole provisions and metrics to incrementally enhance yields at the top of the capital structure rather than reaching deeper into capital structures for mezzanine and equity co-investments to achieve incremental yield.

我們對新投資仍保持高度選擇性，因為我們對美國消費者仍持謹慎態度，特別是考慮到近期全球事態發展以及利率和通膨水準持續走高。我們繼續策略性地將重點放在第一留置權投資上，並傾向於利用收益增強條款，如選擇功能、看漲期權保護、整體條款和指標來逐步提高資本結構頂部的收益率，而不是深入到資本結構中夾層和股權共同投資以實現增量收益。

Approximately 60% of our annual [PIC] income is derived from highly structured situations such as our litigation finance investments where we can attain higher yields by matching flexible pick timing features with strict cash flow sweeps upon collections or through coupon structures where PIC is incremental to our cash interest. Approximately 85% of our PIC investments are in portfolio companies, risk rated either 1% or 2% and 97%, risk-rated 3% or better.

我們約60% 的年度[PIC] 收入來自高度結構化的情況，例如我們的訴訟財務投資，我們可以透過將靈活的選擇時機功能與收款時嚴格的現金流掃描相匹配或透過票券結構（其中PIC 遞增）來獲得更高的收益。我們的現金利息。我們約 85% 的 PIC 投資投資於投資組合公司，風險評級為 1% 或 2%，而 97% 的風險評級為 3% 或更高。

Turning now to our Q4 investment and portfolio activity. During Q4, we completed an attractive mix of first-lien investments. We completed private direct first lien financing tranches from new platforms, including Nova compression, North Star travel and tactical air support where we act as co-lead arranger. We also completed a number of first lien add-on investments for portfolio companies, including work, Genius, HW, Lochner, David's Bridal, you SulphCo and Moss. The weighted average coupon for our direct investments was approximately SOFR plus 8% for the quarter.

現在轉向我們第四季的投資和投資組合活動。在第四季度，我們完成了一系列有吸引力的第一留置權投資。我們透過新平台完成了私人直接第一留置權融資部分，包括 Nova 壓縮、North Star 旅行和戰術空中支援，我們在這些平台上擔任聯合牽頭安排人。我們也為投資組合公司完成了多項第一留置權附加投資，包括work、Genius、HW、Lochner、David's Bridal、you SulphCo 和Moss。本季我們直接投資的加權平均票息約為 SOFR 加 8%。

We additionally continued our purchases of the lightly syndicated first lien tranches of companies such as pure Star Yak, Matt, Amazon, young and Avalon. At discounts. These purchases proved to be attractive as pure Star Yak MAT and Avalon have been recently refinanced and we have received significant investment income from OID. acceleration in Q1 of this year. Allison young announced a comprehensive recapitalization and deleveraging transaction that is expected to close in Q1 of 2024 and positions the company for future growth and investment. Upon closing, we expect to realize significant accretion to the blended cost of our first lien investment in Addison Young.

我們也繼續購買純星犛牛、馬特、亞馬遜、young 和 Avalon 等公司的輕度銀團第一留置權部分。折扣時。這些購買被證明是有吸引力的，因為純 Star Yak MAT 和 Avalon 最近已經進行了再融資，我們從 OID 獲得了可觀的投資收入。今年第一季加速。Allison young 宣布了一項全面的資本重組和去槓桿化交易，預計將於 2024 年第一季完成，為公司未來的成長和投資做好準備。交易完成後，我們預計我們對 Addison Young 的第一筆留置權投資的混合成本將大幅增加。

During Q4, we made $152 million in new investment commitments across 5 new and 15 existing portfolio companies, of which $147 million was funded. These investments were diversified across direct and secondary opportunities with approximately 72% in direct private investments. We also funded a total of $7 million of previously unfunded commitments. We had sales and repayments totaling $83 million for the quarter, which primarily consisted of the full repayment of our investments in cadence, Archer systems and WN and associated asphalt.

第四季度，我們對 5 家新投資組合公司和 15 家現有投資組合公司做出了 1.52 億美元的新投資承諾，其中 1.47 億美元已到位。這些投資在直接和二次機會方面多樣化，其中約 72% 是直接私人投資。我們也為先前未提供資金的承諾提供了總計 700 萬美元的資金。本季我們的銷售和還款總額為 8,300 萬美元，其中主要包括全額償還我們對 cadence、Archer 系統和 WN 及相關瀝青的投資。

As a result, net funded investment activity increased by approximately $71 million during the quarter. The repayment trend has continued into 2024 as M&A activity has fueled recent Q1 repayments that have resulted in significant OID acceleration and incremental investment income from yield enhancement provisions such as prepayment premiums, may cause and metrics attached to our first lien portfolio.

因此，本季淨資助投資活動增加了約 7,100 萬美元。還款趨勢一直持續到2024 年，因為併購活動推動了最近第一季的還款，導致OID 顯著加速，並從收益增強條款（例如預付款溢價）中獲得了增量投資收入，可能原因和我們的第一留置權投資組合所附加的指標。

Our nonaccruals declined slightly from 1% of fair value at 9-30-23 to 0.9% of fair value at 12-31-23. We added one new name, our second lien investment in Trimax Ambrosia with approximately $1.5 million of fair market value to nonaccrual this quarter, Trimark was in the process of a voluntary restructuring process in Q4 that did not close until January of 2024.

我們的非應計費用從 2023 年 9 月 30 日的公允價值的 1% 略微下降至 2023 年 12 月 31 日的公允價值的 0.9%。我們新增了一個新名稱，即我們對Trimax Ambrosia 的第二項留置權投資，本季的公平市價約為150 萬美元，Trimark 正在第四季度進行自願重組過程，該重組過程直到2024 年1 月才結束。

As a result of the restructuring, we participated in the backstop group and received a package of backstop fee take-back debt and equity for first lien and second lien positions in the Company. Given the closing of the transaction, we expect to remove Trustmark from nonaccrual status in Q1 of 2024. Overall, our portfolio remains defensive in nature with 85% in first lien investments and 87% in senior secured investments.

由於重組，我們參與了支持小組，並收到了一系列支持費用收回債務和公司第一留置權和第二留置權頭寸的股權。鑑於交易已完成，我們預計將在 2024 年第一季將 Trustmark 從非應計狀態中刪除。總體而言，我們的投資組合仍然具有防禦性，其中 85% 為第一留置權投資，87% 為優先擔保投資。

I'll now turn the call over to Keith.

我現在將電話轉給基斯。

Thank you, Greg, and good morning, everyone. As Michael mentioned, we reported another quarter of solid financial results, driven by the benefits of higher base rates on our mostly floating rate portfolio and fees generated from a quarterly investment activity during the fourth quarter, net investment income was $21.8 million, or $0.40 per share as compared to $30 million or $0.55 per share reported in the third quarter. For the full year, net investment income was $105 million or $1.92 per share as compared to $88.2 million or $1.56 per share for the prior year. This is an increase of $0.36 per share with 23% year over year.

謝謝你，格雷格，大家早安。正如邁克爾所提到的，我們報告了又一個季度穩健的財務業績，這得益於我們大部分浮動利率投資組合的基本利率上升以及第四季度季度投資活動產生的費用，淨投資收入為2180 萬美元，即每季0.40 美元。與第三季報告的 3000 萬美元或每股 0.55 美元相比。全年淨投資收益為 1.05 億美元，即每股 1.92 美元，而上一年的淨投資收益為 8,820 萬美元，即每股 1.56 美元。每股成長 0.36 美元，年增 23%。

On the expense side, total operating expenses were $38.2 million as compared to $37.6 million reported in the third quarter. The increase was driven by higher interest expense under our financing arrangements due to an increase in our average debt outstanding when compared to the prior quarter at December 31st, we had total assets of approximately $2 billion and total equity or net assets of $880 million with total debt outstanding of $1.1 billion and 54.2 million shares outstanding.

在費用方面，總營運費用為 3,820 萬美元，而第三季報告的營運費用為 3,760 萬美元。這一增長是由於我們的融資安排下的利息支出增加所致，這是由於我們的平均未償債務增加，與截至12 月31 日的上一季相比，我們的總資產約為20 億美元，總股本或淨資產為8.8 億美元，未償債務為 11 億美元，已發行股票為 5,420 萬股。

At the end of the quarter, our net debt to equity ratio was 1.10 times, which is slightly higher than 1.03 times at the end of Q3. During the year, our total debt outstanding increased by $134 million or 14% from the prior year, reflecting the measured growth of our portfolio using additional debt capital.

截至季末，我們的淨負債權益比率為1.10倍，略高於第三季末的1.03倍。年內，我們的未償債務總額比前一年增加了 1.34 億美元，即 14%，反映了我們使用額外債務資本衡量的投資組合的成長。

Our portfolio at fair value ended the quarter at $1.8 billion, up $113 million from the third quarter, reflecting the combination of net fundings and net unrealized gains from the portfolio. The weighted average yield on our debt and other income-producing investments at amortized cost was 13.4% at December 31, which increased 36 basis points from 13.04% at the end of Q3 and increased over 100 basis points from the prior year end.

我們的投資組合以公允價值計算，本季末達到 18 億美元，比第三季增加 1.13 億美元，反映了投資組合的淨資金和未實現淨收益的組合。截至12月31日，我們的債務和其他創收投資的攤餘成本加權平均收益率為13.4%，比第三季末的13.04%增加了36個基點，比上年末增加了100多個基點。

At December 31st, our NAV was $16.23 per share as compared to $15.80 per share at September 30, an increase of $0.43 per share or 2.7%. The increase was driven by mark-to-market price increases in our portfolio and the accretive nature of a share repurchase program during the quarter, which was offset by our year end special and fourth quarter supplemental distributions totaling $0.20 per share.

截至 12 月 31 日，我們的資產淨值為每股 16.23 美元，而 9 月 30 日為每股 15.80 美元，每股增加 0.43 美元，即 2.7%。這一增長是由我們的投資組合按市價計算的價格上漲以及本季度股票回購計劃的增值性質推動的，而我們的年終特別和第四季度補充分配總計每股 0.20 美元抵消了這一增長。

For the quarter, we experienced a significant mark-to-market price increase to the value of our common equity investment in David's Bridal, given the overall larger size of this position relative to our other equity investments and the seasonal nature of its end markets, we do expect to have a higher than average mark to market price volatility in the fair market value of this investment on a quarter-to-quarter basis.

在本季度，考慮到 David's Bridal 普通股投資的整體規模相對於我們的其他股本投資規模較大以及其終端市場的季節性，我們經歷了按市價計價的顯著上漲，我們確實預計該投資的公平市場價值按季度計算的市場價格波動率將高於平均值。

Year over year, our NAV was up $0.25 per share or 1.6%, increasing from $15.98 per share at the end of 2022 to $16.23 per share at the end of 2023, reflecting the strong credit quality of our portfolio. We ended the quarter with a strong and flexible balance sheet with over $600 million in unencumbered assets, lower net leverage relative to our peers, a strong debt servicing capacity and solid liquidity.

我們的淨值年增 0.25 美元，即 1.6%，從 2022 年底的每股 15.98 美元增加到 2023 年底的每股 16.23 美元，反映出我們投資組合的強勁信用品質。本季結束時，我們的資產負債表強勁而靈活，未支配資產超過 6 億美元，淨槓桿率低於同行，償債能力強大，流動性穩定。

We have over $120 million in cash and short-term investments and access to an additional $150 million under our credit facilities to further finance our investment pipeline and continue to support our existing portfolio companies. During the quarter, the weighted average cost of our debt capital was about 8.5%.

我們擁有超過 1.2 億美元的現金和短期投資，並可根據信貸安排獲得額外的 1.5 億美元，以進一步為我們的投資管道提供資金，並繼續支持我們現有的投資組合公司。本季度，我們債務資本的加權平均成本約為 8.5%。

In terms of our debt structure, as we previously discussed in October, we closed on a $33 million follow-on to our Series A unsecured floating rate notes to certain institutional investors in Israel with the same terms as the existing notes issued earlier in the year.

就我們的債務結構而言，正如我們之前在10 月討論的那樣，我們向以色列的某些機構投資者發行了3300 萬美元的A 系列無擔保浮動利率票據，其條款與今年早些時候發行的現有票據相同。

And in November, we completed a $100 million private offering of floating rate unsecured notes to certain US institutional investors. The addition of these unsecured notes to our debt capital brings additional strength and flexibility to our balance sheet and aligns well with our mostly floating rate investments. After completing these two financing transactions, our debt mix is now about 60% in senior secured and 40% in unsecured, with about 85% in floating rates.

11 月，我們完成了向某些美國機構投資者私募 1 億美元的浮動利率無擔保票據發行。將這些無擔保票據添加到我們的債務資本中，為我們的資產負債表帶來了額外的實力和靈活性，並與我們大部分浮動利率投資保持良好一致。完成這兩項融資交易後，我們的債務結構目前約為 60% 為優先擔保債務，40% 為無擔保債務，約 85% 為浮動利率債務。

Now turning to our distributions. During the fourth quarter, we paid total distributions to our shareholders of $0.54 per share, which includes a base distribution of $0.34 per share, a year-end special distribution of $0.15 per share and a previously declared fourth quarter supplemental distribution of $0.05 per share. For the full year 2023, we declared total distributions of $1.61 per share as compared to total distributions of $1.45 per share during 2022, an increase of $0.16 per share or 11% year over year. As a result, our distribution yield based on the year-end average NAV that was 9.9% and our distribution yield based on a year-end market price was 14.2%.

現在轉向我們的發行版。第四季度，我們向股東支付了每股 0.54 美元的總分配，其中包括每股 0.34 美元的基本分配、每股 0.15 美元的年終特別分配以及先前宣布的每股 0.05 美元的第四季度補充分配。對於 2023 年全年，我們宣布的總分配額為每股 1.61 美元，而 2022 年的總分配額為每股 1.45 美元，每股增加 0.16 美元，同比增長 11%。因此，我們基於年末平均資產淨值的分配報酬率為 9.9%，基於年末市場價格的分配報酬率為 14.2%。

As announced this morning, we declared our first quarter base distribution of $0.34 per share, which is the same amount as the base distributions declared during the fourth quarter of 2023. The first quarter distribution will be paid on March 28th to shareholders of record on March 22nd.

正如今天上午所宣布的，我們宣布第一季基本分配為每股 0.34 美元，這與 2023 年第四季宣布的基本分配金額相同。第一季分配將於 3 月 28 日支付給 3 月 22 日登記在冊的股東。

Okay. With that, I will now turn the call back over to Michael for some closing remarks.

好的。現在，我將把電話轉回給邁克爾，讓他發表一些結束語。

Thanks, Keith. As a final thought before we open the line for questions, I would like to reiterate our message that we believe Cyan is undervalued, continues to perform well and is well positioned to continue to provide solid returns to its shareholders.

謝謝，基斯。作為我們開始提問之前的最後一個想法，我想重申我們的訊息，即我們認為 Cyan 的價值被低估，但仍表現良好，並且有能力繼續為其股東提供豐厚的回報。

And with that, operator, we're ready to take any questions.

接線員，我們已經準備好回答任何問題了。

(Operator Instructions) Erik Zwick, Hovde Group.

（操作說明）Erik Zwick，Hovde Group。

Good morning, everyone. Wanted to start with a, um, a question of following the Q4 actions to raise more unsecured debt. You noted that the the mix now kind of 60/40 secured versus unsecured. And curious, have you kind of reached your target mix there? Or do you anticipate potentially making some additional changes into 2024?

大家，早安。我想從一個，嗯，跟隨第四季度行動籌集更多無擔保債務的問題開始。您注意到，現在安全與不安全的混合比例為 60/40。很好奇，你達到了你的目標組合嗎？或者您預計 2024 年可能會做出一些額外的改變？

Good morning, Eric. This is Keith. So in terms of our debt capital. We continue to work with our commercial banking partners on extending our current arrangements. Those conversations continue to be had today. So we'll probably have a better update for you over the next couple of weeks or months. And at the same time, we continue to explore, you know, opportunities in the debt capital markets, which would further diversify our mix between secured and unsecured and also expand our lending partners that we do business with. So yes, we are I don't think that we're done. I think we'll continue to explore opportunities as they present themselves.

早安，埃里克。這是基斯。就我們的債務資本而言。我們將繼續與商業銀行合作夥伴合作，擴展我們目前的安排。這些對話今天仍在繼續。因此，我們可能會在接下來的幾週或幾個月內為您提供更好的更新。同時，我們繼續探索債務資本市場的機會，這將進一步使我們的擔保和無擔保組合多樣化，並擴大與我們開展業務的貸款合作夥伴。所以是的，我們是的，我不認為我們已經完成了。我認為我們將繼續探索機會的出現。

Thanks. Keep switching gears, just curious if you could provide any commentary on what the current pipeline may be in terms of the mix of new versus add-on opportunities as well as any if you're seeing any particular industries that are stronger and presenting maybe more attractive opportunities today?

謝謝。繼續轉換方向，只是好奇您是否可以就當前管道在新機會與附加機會的組合方面提供任何評論，以及如果您看到任何更強大並且可能呈現更多機會的特定行業今天有誘人的機會嗎？

Hi, Eric. It's Greg. It really is diversified. There's no one specific industry focus on what we're seeing a B to B remains strong. So you will see that in our business services focus. We're still seeing opportunities, niche opportunities in healthcare and industrial services. So it's pretty broad based. I wouldn't say there's one particular Intuit.

嗨，艾瑞克。是格雷格。確實是多元化的。我們看到，沒有一個特定產業對 B2B 的關注仍然強勁。所以你會在我們的商業服務重點中看到這一點。我們仍然在醫療保健和工業服務領域看到機會、利基機會。所以它的基礎相當廣泛。我不會說有一個特定的 Intuit。

Thanks. And make our kind of the mix between new and add-on opportunities today.

謝謝。並讓我們今天的新機會和附加機會結合。

Yes, we're seeing both it's healthy on both sides. We do see platform M&A starting to pick up sales of companies, but we're also seeing a lot of incremental add-on activity where we step in so it really is a combination of both banks.

是的，我們看到雙方都很健康。我們確實看到平台併購開始提振公司的銷售額，但我們也看到我們介入的許多增量附加活動，因此這實際上是兩家銀行的結合。

And previously, you mentioned that your portfolio companies kind of have been growing at a single digit EBITDA are hearing just from anecdotal evidence and talking to some other BDCs that some are starting to see some slowdowns in certain pockets of the economy. So just curious if you could provide any kind of insight into what you're seeing with your portfolio companies and whether they continue to grow and improve at this point?

之前，您提到您的投資組合公司的 EBITDA 一直以個位數成長，只是從軼事證據中得知，並與其他一些 BDC 交談，其中一些公司開始看到某些經濟領域出現放緩。因此，我想知道您是否可以提供有關您在投資組合公司中所看到的情況以及它們目前是否繼續增長和改進的任何見解？

Yes, we're still seeing the single digit growth. It's we haven't seen any pronounced slowdown. It varies industry by industry, but I think that single digit measure still holds.

是的，我們仍然看到個位數的成長。我們沒有看到任何明顯的放緩。每個行業的情況各不相同，但我認為個位數的衡量標準仍然成立。

And then last one for me on. Can you provide any comments on what drove the unrealized gains this quarter?

然後是我的最後一張。您能否對本季未實現收益的推動因素發表評論？

Yes. So mark to market. Obviously, there was some spread compression, which typically run at our model. So we did see spreads tightening a bit and also the David's Bridal was it proposed a strong in this quarter and that had to do with really the purchase accounting adjustments associated with closing the transaction. The auditors had the time to perform the revalued inventory merchandise and things like that. So you saw on a mark to market increase based on that analysis.

是的。所以按市場定價。顯然，存在一些擴展壓縮，通常在我們的模型中運行。因此，我們確實看到利差有點收緊，而且大衛的新娘在本季度提出了強勁的建議，這與完成交易相關的購買會計調整有關。審計員有時間對庫存商品進行重估等工作。因此，根據該分析，您看到了按市值計價的增長。

Steven Martin, Slater Capital Management.

史蒂文馬丁，斯萊特資本管理公司。

Hi, guys. Following up on your last response on David's Bridal on T. talk is there any incremental information on its performance, its turnaround? I see you extended additional credit and I assume it's current pay, et cetera.

嗨，大家好。繼您上次在 T. talk 上對 David's Bridal 的回應之後，是否有任何關於其表現和轉變的增量信息？我看到你提供了額外的信用，我認為這是目前的工資，等等。

So I think there's really no not much material information we can share on part of it too, as you're going through the selling season now. So we'll have a much better view in the next couple of quarters on the incremental debt this quarter was a synthetic letter of credit facility. So it wasn't a general loan. It was more to back LCs to free up capacity under a traditional ABL so it really wasn't done at corporate for use loan. It was really to help the Company more efficiently and cost of capital basis backstop a standby LCs.

因此，我認為我們確實沒有太多實質資訊可以分享，因為您現在正處於銷售季節。因此，在接下來的幾個季度中，我們將更了解本季的增量債務是合成信用狀融資。所以這不是一般貸款。更多的是支持信用證以釋放傳統 ABL 下的產能，因此實際上並沒有在企業使用貸款中完成。這實際上是為了幫助公司更有效地利用資本成本基礎來支持備用信用證。

Got it. Are they now complete with all the closings and restructurings that were discussed previously?

知道了。他們現在完成了之前討論的所有關閉和重組嗎？

Yeah.

是的。

Okay. On the I just and this is probably something you talked about on the third quarter on interest income from Q2 to Q3 to Q4 went from [$0.57 to $0.64] and then back down to 64 -- [$0.56]. What was the anomaly in Q3 accounted for that?

好的。就我而言，這可能是您在第三季度談到的，從第二季度到第三季度再到第四季度的利息收入從[0.57 美元到0.64 美元]，然後回落到64 - [0.56 美元]。第三季的異常現像是什麼原因造成的？

Yes, good morning. It's Keith. So in Q3, we had some make whole fees that we recognize as a result of some exits and some additional income recognized as a result of some restructuring transactions that brought back and recapture some income that.

是的，早安。是基思。因此，在第三季度，我們因某些退出而確認了一些整體費用，並因一些重組交易而確認了一些額外收入，這些交易帶回並重新獲得了一些收入。

Yes, I figured you had mentioned it, but I just couldn't find a note on it. On where do you stand on PIC sequentially and going forward?

是的，我想你已經提到過，但我找不到相關註解。您對 PIC 的順序和未來有何看法？

So we discuss some in our in our conference today, our PIC income, it's diversified and it's usually driven by structured situations where we're picking up enhanced yield for the flexibility. We do expect over time, that number to come down as our current portfolio, our refinances or gets repaid, and there's structured situations. So overtime, we do expect it to come down. But again, it's more opportunistic, but we've chosen strategically is we would rather, for special situations, be pick security at the top of the capital structure than do equity coinvestment managers, which are junior securities, where you have a lot more capital structure risks. So for us, we find it's a good risk return trade-off.

因此，我們在今天的會議上討論了我們的 PIC 收入，它是多元化的，通常是由結構性情況驅動的，在這種情況下，我們正在提高靈活性以獲得更高的收益率。我們確實預計，隨著時間的推移，這個數字會隨著我們目前的投資組合、我們的再融資或償還而下降，並且存在結構性情況。因此，隨著時間的推移，我們確實預計它會下降。但同樣，它更具機會主義色彩，但我們的策略選擇是，在特殊情況下，我們寧願選擇資本結構頂層的證券，而不是股權共同投資經理，這些經理是初級證券，你擁有更多的資本結構風險。所以對我們來說，我們發現這是一個很好的風險回報權衡。

Okay. And last on on you did a good job on the nonperformings and non-accruals. Are there any prospective restructurings that would reduce that further after the quarter this quarter or next quarter.

好的。最後，您在不良貸款和非應計費用方面做得很好。是否有任何預期的重組會在本季或下季之後進一步減少這種情況。

Now other Michael other than trademark, as Greg mentioned, which we expect to take off nonaccrual this quarter (inaudible) also know by now.

現在，除了商標之外的其他邁克爾，正如格雷格所提到的，我們預計本季將取消非應計費用（聽不清楚），現在也知道了。

Thank you. There are no further questions at this time. I'd like to hand the floor back over to management for closing comments.

謝謝。目前沒有其他問題。我想將發言權交還給管理層以供結束評論。

Well, we thank everyone for tuning in today, and we look forward to talking to a couple of months after the close of the first quarter. Take everyone. Thank you.

好吧，我們感謝大家今天的收聽，我們期待在第一季結束後的幾個月內進行討論。帶走大家。謝謝。

This concludes today's conference. You may disconnect your lines at this time. Thank you for your participation.

今天的會議到此結束。此時您可以斷開線路。感謝您的參與。