Morgan Stanley Direct Lending Fund (MSDL) 2025 Q1 法說會逐字稿

Welcome to Morgan Stanley Direct Lending first-quarter 2025 earnings call. At this time, all participants are in a listen and only mode. A question-and-answer session will follow the prepared remarks. As a reminder, this conference call is being recorded. At this time, I'd like to turn the call over to Ms. Sanna Johnson. Please go ahead, ma'am.

歡迎參加摩根士丹利直接貸款 2025 年第一季財報電話會議。此時，所有參與者都處於聆聽和唯一模式。準備好的發言之後將進行問答環節。提醒一下，本次電話會議正在錄音。現在，我想將電話轉給桑娜·約翰遜女士。請繼續，女士。

Good morning and welcome to Morgan Stanley Direct Lending Fund's first-quarter 2025 earnings call. Joining me this morning are Jeff Levin, Chief Executive Officer; Michael Occi, President; David Pessah, Chief Financial Officer; and Rebecca Shaoul, Head of Portfolio Management. Morgan Stanley Direct Lending Fund's first-quarter 2025 financial results were released yesterday after market closed and can be accessed on the Investor Relations section of our website at www.msdl.com. We have arranged for a replay of today's event that will be accessible from the Morgan Stanley Direct Lending Fund website.

早安，歡迎參加摩根士丹利直接貸款基金 2025 年第一季財報電話會議。今天早上與我一起出席的還有執行長 Jeff Levin； Michael Occi，總裁；大衛‧佩薩 (David Pessah)，財務長；以及投資組合管理主管 Rebecca Shaoul。摩根士丹利直接貸款基金 2025 年第一季財務表現於昨日市場收盤後發布，可透過我們網站 www.msdl.com 的投資者關係部分查閱。我們已安排重播今天的活動，可從摩根士丹利直接貸款基金網站存取。

During this call, I want to remind you that we may make forward-looking statements based on current expectations. The statements on this call that are not purely historical or forward-looking statements. These forward-looking statements are not a guarantee of future performance and are subject to uncertainties and other factors that could cause actual results to differ materially from those expressed in the forward-looking statements, including and without limitation, market conditions, uncertainties surrounding interest rates, changing economic conditions, and other factors we have identified in our filings with the SEC.

在這次電話會議中，我想提醒您，我們可能會根據當前的預期做出前瞻性的陳述。本次電話會議中的陳述並非純粹的歷史性陳述或前瞻性陳述。這些前瞻性陳述並不能保證未來的業績，並且受不確定因素和其他因素的影響，這些因素可能導致實際結果與前瞻性陳述中表達的結果存在重大差異，包括但不限於市場條件、利率的不確定性、不斷變化的經濟狀況以及我們向美國證券交易委員會提交的文件中確定的其他因素。

Although we believe that the assumptions on which these forward-looking statements are based or reasonable, any of those assumptions can prove to be inaccurate, and as a result, the forward-looking statements based on those assumptions can be incorrect. You should not place undue reliance on these forward-looking statements. The forward-looking statements contained on this call are made as of the date hereof, and we assume no obligation to update the forward-looking statements or subsequent events. To obtain copies of SEC-related filings, please visit our website. With that, I will now turn the call over to Jeff Levin.

儘管我們相信這些前瞻性聲明所依據的假設是合理的，但任何這些假設都可能被證明是不準確的，因此，基於這些假設的前瞻性陳述可能是不正確的。您不應過度依賴這些前瞻性陳述。本次電話會議所包含的前瞻性陳述均截至本電話會議之日作出，我們不承擔更新前瞻性陳述或後續事件的義務。若要取得 SEC 相關文件的副本，請造訪我們的網站。說完這些，我現在將電話轉給傑夫·萊文 (Jeff Levin)。

Thank you, Sanna. Thank you for joining us today from Morgan Stanley Direct Lending's first-quarter 2025 conference call. We generated strong performance in the first quarter as we continued to deploy capital prudently in the face of what has been a more volatile environment for financial markets. I will first begin with a summary of our performance in the first quarter before handing it to Michael to discuss the market. Dave will then provide updates on our portfolio and comment on the financial results.

謝謝你，桑娜。感謝您今天參加摩根士丹利直接貸款 2025 年第一季電話會議。面對更動盪的金融市場環境，我們繼續審慎地配置資本，因此第一季我們取得了強勁的業績。我將先總結我們第一季的業績，然後再交給麥可討論市場。然後戴夫將提供我們投資組合的最新情況並對財務結果發表評論。

Our team delivered solid operating results for the first quarter, supported by strong underlying credit performance. We generated net investment income of $0.52 per share. This exceeded the $0.50 dividend declared and was once again of high quality with low contributions from payment in kind and other income.

在強勁的基礎信貸表現的支持下，我們的團隊在第一季取得了穩健的經營業績。我們產生了每股0.52美元的淨投資收益。這超過了宣布的 0.50 美元股息，並且再次保持高質量，實物支付和其他收入的貢獻較低。

For the first quarter, new investment commitments to approximately $233 million which represented a meaningful increase in gross deployment relative to the prior quarter. Repayments accelerated in the first quarter amounted to $202 million with seven portfolio companies fully repaid. During the quarter, MSDL's debt to NAV increased modestly from 1.08 times to 1.11 times.

第一季度，新的投資承諾約為 2.33 億美元，與上一季相比，總部署量有顯著成長。第一季還款額加速達 2.02 億美元，其中七家投資組合公司已全額還款。本季度，MSDL 的債務與資產淨值之比小幅上升，從 1.08 倍增至 1.11 倍。

Our deployment activity in the quarter showcased once again our ability to leverage our unique origination engine to drive quality deal flow, even amidst a slower than anticipated start to the year for M&A. Consistent with the trend that we had highlighted for the full year of 2024, more than 70% of the non-refinancing gross deployment in the first quarter was to new borrowers.

我們在本季的部署活動再次展示了我們利用獨特的發起引擎來推動優質交易流程的能力，即使今年併購交易的開局速度低於預期。與我們強調的 2024 年全年趨勢一致，第一季非再融資總部署的 70% 以上是針對新借款人的。

While LBO activity remains subdued as private equity awaits more clarity on government reform, our unique sourcing platform has produced high-quality investing opportunities with businesses that are new to our platform. Our thought leadership and market visibility are also validated by the proportion of new platforms that we are leading. In the first quarter, we led or co-led all the facilities for new borrowers.

由於私募股權正在等待政府改革的進一步明朗，槓桿收購活動依然低迷，但我們獨特的採購平台已經為新加入該平台的企業創造了高品質的投資機會。我們領導的新平台的比例也證明了我們的思想領導和市場知名度。在第一季度，我們主導或共同主導了所有針對新借款人的貸款安排。

As we have discussed in previous calls, we continue to benefit from the broader Morgan Stanley platform, which we continue to leverage in the current volatile macro backdrop. We believe that sponsors are drawn to the quality of our team and our ability to be a value add partner, which are enhanced by our position within the broader Morgan Stanley ecosystem. We believe that these factors have helped our sponsor backed direct lending business here in North America, surpass $20 billion in committed capital, which is an important milestone for us.

正如我們在先前的電話會議中討論過的，我們繼續受益於更廣泛的摩根士丹利平台，並在當前動蕩的宏觀背景下繼續利用該平台。我們相信，贊助商被我們團隊的素質和我們成為增值合作夥伴的能力所吸引，而我們在更廣泛的摩根士丹利生態系統中的地位則增強了這些能力。我們相信，這些因素幫助我們在北美的贊助商支持的直接貸款業務的承諾資本超過 200 億美元，這對我們來說是一個重要的里程碑。

While significant, our breadth and depth of sponsor relationships allows us to see a vast range of deal flow, and that deal flow exceeds our capital base, which breeds selectivity. We believe that this selectivity on the investment side is the engine that will help us to continue to source and underwrite lending opportunities that produce strong risk adjusted returns for shareholders.

雖然意義重大，但我們與贊助商關係的廣度和深度使我們能夠看到廣泛的交易流程，並且交易流程超出了我們的資本基礎，從而產生了選擇性。我們相信，投資方面的這種選擇性將幫助我們繼續尋找和承保貸款機會，為股東帶來強勁的風險調整回報。

Furthermore, our transparent revenue model, relatively low operating expense base and thoughtful fee structure, also serves to demonstrate strong alignment with shareholders and our continued focus on executing our defensive investment strategy to optimize performance and drive shareholder value. With that, I would like to hand the call over to Michael, who will provide some commentary on the market.

此外，我們透明的收入模式、相對較低的營運費用基礎和周到的費用結構也表明我們與股東的高度一致，並且我們繼續專注於執行防禦性投資策略，以優化績效並推動股東價值。說完這些，我想把電話交給邁克爾，他將對市場做出一些評論。

Thank you, Jeff. I will start by addressing deal activity in the market. It's old news by now, but the tariff-driven volatility has pushed off what we initially expected could be a sharp recovery in M&A activity at the beginning of the year. However, private equity firms still have significant amounts of capital to deploy, and we expect the high level of client dialogue may translate into increased deal flow as the market gains more clarity on tariffs.

謝謝你，傑夫。我將首先討論市場上的交易活動。這已經是舊聞了，但關稅引發的波動已經推遲了我們最初預期的年初併購活動的急劇復甦。然而，私募股權公司仍然擁有大量資本可供部署，我們預計，隨著市場對關稅的認識更加清晰，高水準的客戶對話可能會轉化為交易量的增加。

While uncertainty remains, we have continued to see a solid pipeline of attractive opportunities, as evidenced by MSDL's deployment in the quarter. The direct lending market has been open for business amidst the elevated volatility since the beginning of April. While access in the public sub-investment grade, credit market has been more window driven. This current market may serve as another opportunity for private credit to take share from the leveraged loan market. This market dynamic often presents investment opportunities for direct lenders that create better risk adjusted returns, and we have recently seen large high-quality borrowers step into our market.

儘管不確定性依然存在，但我們仍然看到了一系列有吸引力的機會，MSDL 在本季的部署就證明了這一點。自四月初以來，直接貸款市場在劇烈波動中依然正常運作。雖然進入公共次投資等級信貸市場，但信貸市場更受到窗口驅動。目前的市場可能成為私人信貸從槓桿貸款市場中分得一杯羹的另一個機會。這種市場動態通常為直接貸款人提供創造更好風險調整回報的投資機會，我們最近看到大量優質借款人進入我們的市場。

Spreads on new capital deployed in the first quarter were virtually flat versus the second half of 2024. Over time, we expect that pricing will be responsive to evolving market conditions. Even if we see more Fed cuts this calendar year, gross asset yields are likely to continue to remain elevated, offering attractive opportunities for us. We continue to find the market's pricing compelling on a risk adjusted basis when you consider the stability of loan to value and leverage ratios for the capital we have deployed in MSDL over the last several quarters.

第一季部署的新資本利差與 2024 年下半年相比基本持平。隨著時間的推移，我們預計定價將響應不斷變化的市場條件。即使聯準會今年進一步降息，總資產收益率仍可能繼續保持高位，為我們提供有吸引力的機會。如果考慮到過去幾季我們在 MSDL 中部署的資本的貸款價值和槓桿率的穩定性，我們仍然會發現，在風險調整的基礎上，市場定價具有吸引力。

The tariff situation remains dynamic. Should the tariffs be widespread and more durable, there could be secondary and tertiary impacts on the portfolio. However, from a direct impact perspective, we believe that the MSDL portfolio should be relatively insulated given our geographic and industry orientation.

關稅情勢依然動態。如果關稅廣泛且更持久，可能會對投資組合產生二次和三次影響。然而，從直接影響的角度來看，我們認為，鑑於我們的地理和產業定位，MSDL 投資組合應該相對不受干擾。

From a sector point of view, we have a bias towards professional services businesses and away from more trade sensitive verticals like manufacturing and consumer goods oriented companies. We think that the sectors that will be hardest hit by tariffs will be those that rely on offshore assembly or parts such as consumer and capital goods. In contrast, software insurance services, and business services should be better insulated from the tariffs and retaliatory tariffs, and MSDL is overweight these sectors relative to other BDCs.

從產業角度來看，我們偏向專業服務企業，而對製造業和消費品導向型公司等貿易敏感的垂直產業則持觀望態度。我們認為，受關稅打擊最嚴重的產業將是那些依賴離岸組裝或零件的產業，例如消費品和資本貨物。相較之下，軟體保險服務和商業服務應該能更好地抵禦關稅和報復性關稅的影響，而 MSDL 相對於其他 BDC 而言，在這些領域持有更高的權重。

The US middle market entered 2025 with good momentum on the margins front, with interest coverage ratios on the upswing as well. While slower economic growth could challenge this momentum, we expect the middle market to be more insulated from tariffs than larger companies who derive more sales overseas. It's a variable on the cost side, but we still view the middle market as more insulated given the greater domestic focus.

進入2025年，美國中型市場利潤率動能良好，利息覆蓋率也呈現上升趨勢。儘管經濟成長放緩可能對這一勢頭構成挑戰，但我們預計中端市場將比海外銷售額更大的大公司更能抵禦關稅的影響。這是成本方面的一個變量，但鑑於其更注重國內市場，我們仍然認為中端市場受到的影響較小。

As uncertainty surrounding specific measures and the broader impact remains, we will continue to be vigilant in monitoring developments and are in close contact with management teams and private equity sponsors to assess potential risk and action plans. The team continues to monitor for real-time changes that can impact the portfolio. And as we deploy new capital, tariff policy is obviously very much front and center in terms of how we're allocating dry powder. We think that plays into our defensively minded investment strategy, the evidence of which has been observable through solid credit performance of MSDL.

由於具體措施和更廣泛影響的不確定性仍然存在，我們將繼續保持警惕，監控事態發展，並與管理團隊和私募股權發起人保持密切聯繫，以評估潛在風險和行動計劃。該團隊持續監控可能影響投資組合的即時變化。當我們部署新資本時，關稅政策顯然是我們如何分配資金的首要任務。我們認為這符合我們的防禦性投資策略，MSDL 穩健的信用表現就是明證。

Looking ahead, we believe that we continue to be well positioned to source and underwrite lending opportunities that offer strong risk adjusted returns and in turn create value for MSDL shareholders. I will now hand the call over to David who will provide details on Morgan Stanley Direct Lending Fund's portfolio, investment activity, and financial results.

展望未來，我們相信我們將繼續處於有利地位，能夠尋找並承保提供強勁風險調整回報的貸款機會，從而為 MSDL 股東創造價值。我現在將電話交給 David，他將提供有關摩根士丹利直接貸款基金的投資組合、投資活動和財務表現的詳細資訊。

Thank you, Michael. Starting with our portfolio, we ended the quarter with the total portfolio at fair value of %3.8 billion. Our portfolio was comprised of approximately 96% firstly in debt, 2% secondly in debt, and the remainder in equity and other debt investments. We had investments in 210 portfolio companies spanning across 34 industries with nearly 100% of our investments in fluid and rate debt.

謝謝你，麥可。從我們的投資組合開始，本季結束時我們的總投資組合的公允價值為 38 億美元。我們的投資組合中約 96% 為債務，2% 為債務，其餘為股權和其他債務投資。我們對 34 個行業的 210 家投資組合公司進行了投資，其中幾乎 100% 的投資都投資於流動債務和利率債務。

Our two largest industry exposures remain in software and insurance services, which accounted for 19.5% and 12% of the portfolio at fair value, respectively. The average position size of our investments was approximately $18 million or approximately 50 basis points of our total portfolio at fair value. Further, our Top 10 portfolio companies represented approximately 15% at fair value of the total portfolio.

我們最大的兩個產業曝險仍然是軟體和保險服務，以公允價值計算，它們分別佔投資組合的 19.5% 和 12%。我們投資的平均部位規模約為 1,800 萬美元，或占我們總投資組合公允價值的約 50 個基點。此外，我們的前十大投資組合公司約佔整個投資組合公允價值的 15%。

Regarding credit metrics of our portfolio companies as a quarter end, our weighted average loan to value was approximately 40%. The median EBITDA was approximately $87 million and our weighted average yield on debt and income producing investments was 10.2% at cost and 10.3% at fair value. As mentioned on our fourth quarter 2024 earnings call, the decline in asset yield in part was attributable to the residual impact from the earlier decline in silver.

關於我們投資組合公司季末的信用指標，我們的加權平均貸款價值比約為 40%。EBITDA 中位數約為 8,700 萬美元，我們的債務和創收投資的加權平均收益率以成本計算為 10.2%，以公允價值計算為 10.3%。正如我們在 2024 年第四季財報電話會議上所提到的，資產收益率的下降部分歸因於早先白銀價格下跌的殘餘影響。

Turning to credit quality, over 98% of our total portfolio remained at an internal risk rating of 2 or better. We had one portfolio company, KWOR Acquisition, or more commonly known as alacrity, removed from non-accrual status due to a restructuring event during the quarter. We did place one portfolio company on non accrual status, that being Continental Battery. As of March 31, our non accruals remained just 20 basis points of the portfolio at cost.

談到信用質量，我們總投資組合的 98% 以上保持 2 或更高的內部風險評級。我們有一家投資組合公司 KWOR Acquisition（通常稱為 alacrity）因本季的重組事件而脫離了非應計狀態。我們確實將一家投資組合公司置於非應計狀態，那就是大陸電池公司。截至 3 月 31 日，我們的非應計項目仍佔投資組合成本的 20 個基點。

For our investment activity in the first quarter, we made new investment commitments of approximately $233 million across 9 new portfolio companies and 9 existing portfolio companies. Investment funding totaled approximately $206 million offset by $202 million in repayments, which were more elevated during the quarter.

就第一季的投資活動而言，我們向 9 家新投資組合公司和 9 家現有投資組合公司做出了約 2.33 億美元的新投資承諾。投資資金總額約 2.06 億美元，但還款額為 2.02 億美元，本季還款金額增加。

Moving to our financial results for the first quarter, our total investment income was $101 million for the first quarter as compared to $103 million in the prior quarter. Pick income continues to remain relatively low, amounted to only 4% of total investment income. Total net expenses for the first quarter was $55.2 million compared to $52.3 million in the prior quarter. Net investment income for the first quarter was $46.2 million or $0.52 per share compared to $50.7 million or $0.57 per share from the prior quarter.

查看我們第一季的財務業績，第一季我們的總投資收入為 1.01 億美元，而上一季為 1.03 億美元。挑選收益繼續保持較低水平，僅佔總投資收益的4%。第一季總淨支出為 5,520 萬美元，而上一季為 5,230 萬美元。第一季淨投資收入為 4,620 萬美元，即每股 0.52 美元，而上一季為 5,070 萬美元，即每股 0.57 美元。

The majority of the decline in our NII was driven by our IPO-related fee waivers that expired on January 24, 2025, with a balance attributable to the aforementioned impact from the change of portfolio yields. For the first quarter, the net change in unrealized losses was $17 million which was driven in part by credit spread widening within the secondary market.

我們的 NII 下降主要是由於我們的 IPO 相關費用減免於 2025 年 1 月 24 日到期，其餘部分則歸因於上述投資組合收益率變化的影響。第一季度，未實現損失的淨變動為 1,700 萬美元，部分原因是二級市場信貸利差擴大。

Turn into our balance sheet, as of March 31, total assets were $3.9 billion and total net assets was $1.8 billion. Our ending NAV per share for the first quarter was $20.65 as compared to $20.81 in the prior period. Our debt to equity ratio increased to 1.11 times as compared to 1.08 times in the prior quarter. Approximately 52% of our funded debt was in the form of unsecured notes with well latter maturities through 2030.

翻閱我們的資產負債表，截至 3 月 31 日，總資產為 39 億美元，總淨資產為 18 億美元。我們第一季的每股期末淨資產值為 20.65 美元，而上一季為 20.81 美元。我們的負債權益比率從上一季的 1.08 倍增加至 1.11 倍。我們約 52% 的融資債務為無擔保票據，到期日為 2030 年。

During the quarter, we successfully executed an extension of our secured revolving credit facility by extending our maturity to February 2030, lowering our drones by 10 basis points, and non-drones spread by 2.5 basis points, and lastly increasing our total commitment by $150 million to $1.45 billion. We continue to remain pleased with the composition of our defics and we'll continue to strategically look for ways to optimize it, including with respect to our upcoming unsecured maturity in September of this year.

在本季度，我們成功地延長了我們的擔保循環信貸額度，將期限延長至 2030 年 2 月，將無人機利差降低 10 個基點，將非無人機利差降低 2.5 個基點，最後將我們的總承諾增加 1.5 億美元至 14.5 億美元。我們對我們的債務組成仍然感到滿意，我們將繼續從戰略上尋找優化它的方法，包括針對我們即將在今年 9 月到期的無擔保債務。

Focusing now on our distributions, in the current quarter, we paid a $0.50 regular distribution. In addition, our board of directors declared a regular distribution for the second quarter of $0.50 per share to shareholders of record on June 30, 2025. As of March 20, 2025, our estimated spillover net investment income was $71 million or $0.80 per share.

現在關注我們的分配，在本季度，我們支付了 0.50 美元的定期分配。此外，我們的董事會宣布第二季向 2025 年 6 月 30 日登記在冊的股東定期分配每股 0.50 美元。截至 2025 年 3 月 20 日，我們估計的溢出淨投資收益為 7,100 萬美元或每股 0.80 美元。

Lastly, at the end of the quarter, we successfully established a $300 million at the market equity issuance program, which we believe represents a cost efficient way to raise capital in an accretive manner, which we will only look to use under supportive market conditions. With that, operator, please open the line for questions.

最後，在本季末，我們成功地建立了一個 3 億美元的市場股票發行計劃，我們認為這是一種以增值方式籌集資金的具有成本效益的方式，我們只會在有利的市場條件下才會考慮使用這種方式。接線員，請打開熱線來回答問題。

(Operator Instructions)

（操作員指示）

Melissa Wedel, JP Morgan.

摩根大通的梅麗莎·韋德爾。

Good morning. Thanks for taking my questions today. First, wanted to check in about just sort of run rate earnings power of the portfolio. Is it fair to think that all of the changes in the base rate are fully reflected in 1Q? I know that there's a lag that tends to happen.

早安.感謝您今天回答我的問題。首先，想要檢視一下投資組合的運作率獲利能力。認為基準利率的所有變化都已在第一季充分反映，這種想法合理嗎？我知道這種滯後現像很常見。

Yeah, and thanks for the question. Yeah, for the most part, all the SOFA related activity from Q4 has been flushed through in the Q1 results. The main change that you would see quarter over quarter as you compare NII, $0.04 of the change was attributable to the IPO-related waivers that rolled off in January of this year. Just for full transparency, that's -- there's approximately about a penny per share of residual impact to be expected in Q2 as a result of those waivers fully rolling off.

是的，謝謝你的提問。是的，在大多數情況下，第四季度的所有 SOFA 相關活動都已在第一季的業績中體現出來。與 NII 相比，您會看到季度間的主要變化是，0.04 美元的變化歸因於今年 1 月推出的 IPO 相關豁免。為了完全透明起見，由於這些豁免的完全取消，預計第二季每股將產生約一美分的剩餘影響。

Got it. I appreciate that color. I also wanted to touch on the repurchase plan, you certainly talked about that last quarter. I wanted to understand how you're thinking about deploying, making use of that, particularly since there seem to be some decent usage of that plan in 1Q at levels that were not a huge discount to NAV. And certainly, you're trading shares are trading a bit lower or a bit broader of a discount now compared to what you saw in 1Q. How are you thinking about using that plan going forward? Thank you.

知道了。我很欣賞那個顏色。我還想談談回購計劃，您在上個季度肯定談到了這個問題。我想了解您如何考慮部署和利用該計劃，特別是因為該計劃在第一季似乎得到了不錯的使用，而且其使用水平並未對資產淨值造成太大的折扣。當然，與第一季相比，您交易的股票現在的交易價格要低一些或折扣更大一些。您考慮如何繼續使用該計劃？謝謝。

Yeah, Melissa, it's Michael. Good question. It's a tool we obviously refreshed last quarter with with earnings. We repurchased, as you alluded to, about $10 million over the course of the quarter. Obviously, acretive activity. It's formulaic through a 10b5-1, so it's kind of set it and forget it, but we think it's a logical tool to have in place to help support stock to a certain extent.

是的，梅麗莎，我是麥可。好問題。顯然，這是我們上個季度根據收益更新的工具。正如您所提到的，我們在本季回購了約 1000 萬美元。顯然，這是創造性活動。它是透過 10b5-1 公式化的，所以它有點像設定它然後忘記它，但我們認為它是一個合理的工具，可以在一定程度上幫助支持股票。

(inaudible), Raymond James.

（聽不清楚），雷蒙德詹姆斯。

Hi, thanks for the question. So just a quick one on tariffs with all the recent tariff implications. I know you guys have touched on how you're going to shift strategy in terms of allocating new capital. Would you say there has been a shift with your new deployments this past quarter in terms of targeting certain industries or de-emphasizing exposure in other sectors?

你好，謝謝你的提問。因此，我只想簡單談談關稅以及近期的所有關稅影響。我知道你們已經談到如何在分配新資本方面轉變策略。您是否認為上個季度您的新部署在針對特定行業或減少對其他行業的曝光方面有所轉變？

Yeah, sure. It's Jeff. It's a great question. I think taking a step back, our strategy has been and continues to be to invest in the highest quality private credit transactions that we can originate and stick to the top of the capital structure in a first thing position. Loan to values this past quarter for the capital we deployed was less than 35%. So -- and also importantly, not just creating real diversification among the portfolio but really avoiding the more deeply cyclical industry sectors and underwriting deals that provide highly predictable and sticky cash flow streams.

是的，當然。是傑夫。這是一個很好的問題。我認為退一步來說，我們的策略一直是、並將繼續是投資於我們能夠發起的最高品質的私人信貸交易，並首先堅持在資本結構的頂端。上個季度，我們部署的資本的貸款價值比不到 35%。因此——同樣重要的是，不僅要在投資組合中實現真正的多樣化，還要真正避開週期性更強的行業部門，並承銷提供高度可預測和黏性現金流的交易。

So for example, enterprise software and insurance services being brokers predominantly comprises a very substantial portion of the portfolio, over 50%. So the portfolio, not only has it been performing really well, and that's evidenced by the non-accrual rate being exceptionally low, the pick is a percentage of our total income best-in-class, but avoiding the deeply cyclicals as well. And so, we enter this period of market uncertainty and tariff uncertainty from I think, a real position of strength, given the sectors that we are the longest. We have very little exposure to the more deeply cyclical sectors. As you'd expect, we've done an enormous amount of analysis across our portfolio in touch with sponsors and management teams with regards to companies and sectors that are exposed to tariffs. It's an extremely low percentage of the portfolio on a direct basis.

例如，企業軟體和保險服務作為經紀商，佔投資組合的很大一部分，超過 50%。因此，該投資組合不僅表現良好，而且非應計率極低也證明了這一點，所選資產占我們總收入的比例是同類中最好的，同時也避免了深度週期性資產。因此，考慮到我們涉足時間最長的行業，我認為，我們進入了市場不確定和關稅不確定的時期，處於真正的強勢地位。我們對週期性較強的行業的投資很少。正如您所期望的，我們與贊助商和管理團隊就受關稅影響的公司和行業對我們的投資組合進行了大量的分析。從直接角度來看，這佔投資組合的比例極低。

I think the $64,000 question will be what happens over the course of this year and next year, where things land with regards ultimately with tariffs, and does the economy go into a recession? And the tariff impact could be one thing, but the demand side also is something that we're watching closely. But again, the portfolio, as noted in the prepared remarks, is in great shape. The vast majority of this portfolio is in a first (inaudible) position, enormous value below us underwritten by our team at great length.

我認為價值 64,000 美元的問題是今年和明年會發生什麼，關稅最終會如何發展，經濟是否會陷入衰退？關稅影響可能是一方面，但需求方面也是我們密切關注的。但正如準備好的評論中所指出的，投資組合狀況良好。該投資組合的絕大部分處於第一（聽不清楚）位置，我們團隊經過長時間承保，獲得了巨大的價值。

So we're in terms of change in strategy given the current environment, I wouldn't say that there's a change. We continue to focus on investing in the sectors that are defensive and to the best opportunities we can find. We think we have a better origination footprint than, frankly, anyone in the market, given our affiliation with Morgan Stanley and the levers that we have to pull to win the best deals in the market.

因此，考慮到當前的環境，我們的策略不會改變。我們將繼續專注於投資防禦性產業以及我們能找到的最佳機會。我們認為，鑑於我們與摩根士丹利的合作關係以及我們為贏得市場上最佳交易而採取的手段，我們比市場上的任何人都擁有更好的起源足跡。

Obviously though, eyes wide open as we deploy capital and continuing to avoid sectors that we think could be negatively impacted by what's happening in DC as you'd expect, and we feel really good about where we are. And I think the other -- the natural tailwind and benefit that we have from the current environment could be if we -- if the markets get more dislocated, spreads could widen. We have access to quite a bit of capital given we're not at our target leverage ratio to take advantage of that dislocation.

顯然，我們在部署資本時要睜大眼睛，繼續避開那些我們認為可能受到華盛頓發生的事情負面影響的行業，正如您所預料的那樣，我們對目前的狀況感到非常滿意。我認為，另一個——我們從當前環境中獲得的自然順風和好處可能是，如果市場變得更加混亂，利差可能會擴大。鑑於我們尚未達到目標槓桿率，我們可以獲得相當多的資本來利用這種錯位。

And so, net net of everything I said, I think we feel really good about the money in the ground. We're watching closely to see what happens over the course of the coming quarters and not surprisingly leveraging all the resources that we have here within Morgan Stanley's four walls, which spans far beyond just our US direct lending business and really monetizing and leveraging everything that we can here.

所以，綜合我所說的一切，我認為我們對地下的財富感到非常滿意。我們正在密切關注未來幾季的形勢，並且毫不意外地利用摩根士丹利內部的所有資源，這些資源遠遠超出了我們在美國直接貸款業務的範圍，並且真正將我們在這裡所能利用的一切貨幣化和利用起來。

Thank you for that caller. And just as a quick follow up, I know you guys also touched on M&A recovery being pushed off because of these tariffs. What is your sense for M&A recovery in your conversations for -- in your conversations with private equity just in terms of timeline? Do you think it's later in 2025 or is it being pushed off further than that?

感謝您的來電。作為一個快速的後續問題，我知道你們也談到了由於這些關稅而推遲了併購復甦。在您與私募股權公司的對話中，就時間表而言，您對併購復甦有何看法？您認為這個時間是在 2025 年晚些時候，還是會進一步推遲？

Yeah, another great question. Look, I think in the current environment, it's challenging for private equity to underwrite these transactions because there's uncertainty. So as you well know, during periods of uncertainty, new LVO volume declines, M&A activity declines, that is what it is, it's out of our control. The backdrop again, as you know there's enormous dry powder sitting within the private equity ecosystem. That money will get invested. It's really hard to know when.

是的，又一個好問題。我認為，在當前環境下，私募股權承銷這些交易具有挑戰性，因為存在不確定性。因此，如您所知，在不確定時期，新的 LVO 數量會下降，併購活動會下降，這就是事實，這是我們無法控制的。再次回到背景，如你所知，私募股權生態系統中蘊藏著巨大的資金。這筆錢將會被投資。確實很難知道具體時間。

But that being said, look at the first quarter, volumes across the market were pretty modest, and we found a way to deploy quite a bit of capital into several transactions that we feel great about. And so, I think that again that speaks to the ability for us to deploy capital really well given the sourcing engine that we have here. So you have upwards of 80 people dedicated to direct lending in the US every day, and then we have hundreds of additional feet on the street given our affiliation with Morgan Stanley's sell side, and that's a really powerful model even in markets where activity is somewhat muted.

但話雖如此，看看第一季度，整個市場的交易量相當溫和，我們找到了一種方法，將相當多的資金投入到幾筆我們感到非常滿意的交易中。因此，我認為這再次證明了我們有能力利用我們現有的採購引擎來很好地部署資本。因此，我們每天有超過 80 名員工致力於在美國進行直接貸款，而且由於我們與摩根士丹利賣方有合作關係，我們在街上還有數百名員工，即使在活動較為低迷的市場中，這也是一個非常強大的模式。

One tailwind that we have, which is also helpful, that we've been seeing over the last month or so since there's been volatility to partially offset. A lack of LVO volume is bigger companies coming to the private credit market for financing because the syndicated market, as Michael mentioned, it's episodic in terms of when it's been opened. And so, you know we've seen companies $200 million, $300 million, $400 million, $500 million in EBITDA coming to our market for financing when they would typically go to the syndicated space.

我們擁有一個順風，這也是有幫助的，我們在過去一個月左右的時間裡看到了這一點，因為出現了部分抵消的波動。LVO 交易量的不足導致較大的公司進入私人信貸市場進行融資，因為正如邁克爾所提到的，銀團市場在開放時間方面具有偶然性。所以，你知道，我們看到一些 EBITDA 為 2 億美元、3 億美元、4 億美元、5 億美元的公司進入我們的市場進行融資，而他們通常會進入銀團融資市場。

So I think that until and unless there's more clarity around the tariff situation and the economy, I do think that LVO volumes will be relatively low. I don't necessarily think that's a horrible thing for our business here, given the strength of our platform. When this year things come back, don't know, it certainly feels like it would be later and later in the year given the volatility. I think last year, everyone was hopeful that '25 would be a big year for LVO volumes given the pent up capital base. I think we're -- I would say push that out later into the year and if volatility continues, that could be in 2026. I don't know.

因此我認為，除非關稅情況和經濟狀況更加明朗，否則 LVO 數量將相對較低。考慮到我們平台的實力，我並不認為這對我們的業務來說是一件可怕的事情。今年情況何時會恢復，不知道，考慮到波動性，感覺肯定會在今年晚些時候恢復。我認為去年，考慮到被壓抑的資本基礎，每個人都希望 25 年能成為 LVO 交易量豐收的一年。我認為我們會將這一時間推遲到今年晚些時候，如果波動性持續下去，那可能是在 2026 年。我不知道。

But again, I think we're -- again, we noted the $20 billion of capital across our platform. Our capital base relative to the origination footprint that we have here is grossly in our favor from an investing perspective and allows us to be really selective. We're not -- we don't have $150 billion of direct lending capital that needs to be invested every month, every quarter. It's a very healthy balance of deal flow and origination relative to the capital, all that being said, we are really careful with how we're investing right now because risk is heightened in this environment and we're proceeding with caution.

但我再次認為我們——我們再次注意到我們平台上的資本為 200 億美元。從投資角度來看，我們的資本基礎相對於我們在這裡的起源足跡而言非常有利，並且使我們能夠真正地進行選擇。我們不是——我們沒有需要每個月、每季投資的 1500 億美元的直接貸款資本。相對於資本而言，交易流和發起之間的平衡非常健康，儘管如此，我們現在對投資方式非常謹慎，因為在這種環境下風險加大，我們會謹慎行事。

(Operator Instructions)

（操作員指示）

Doug Harter, UBS.

瑞銀的道格·哈特。

Good morning. It's actually Marissa (inaudible) on for Doug today. Thanks for taking my question. On the increase in commitments we saw this quarter, could you speak a little bit about the kind of demand you're seeing for loans? Was there anything notable about the size of the loans involved, as in fewer bigger deals or more smaller deals?

早安.今天其實是瑪麗莎（聽不清楚）代替道格。感謝您回答我的問題。關於本季我們看到的承諾增加，您能否談談您所看到的貸款需求類型？所涉及的貸款規模是否有任何值得注意的地方，例如大型交易減少還是小型交易增加？

Yeah, I think that this quarter was, I'd say generally more of the same. I'm looking here at my colleagues as well to see if they share that view. I think we're look at the size of the businesses that we finance, if we look at the sectors that we that we invested in, really no change. And as you know, the first quarter of volumes across our market oftentimes includes deals that were heavily worked on in the fourth quarter and didn't close for one reason or another, and they slipped to Q1.

是的，我認為本季的情況總體上與去年同期大致相同。我也在觀察我的同事，看看他們是否也持相同的觀點。我認為，如果我們看一下我們所資助的企業的規模，如果我們看一下我們所投資的行業，實際上沒有什麼變化。如您所知，我們市場第一季的交易量通常包括在第四季度大量進行的交易，但由於某種原因而未完成，並且下滑至第一季。

But no, I'd say it's more of the same, there were a fair number of LVOs that we financed. As mentioned, we led or co-led everything that we did in terms of new deal activity, which we're proud of, really high-quality group of private equity firms that we continue to close business with. Loans to values came down a little bit. I wouldn't read into that. I think that was more episodic in nature and it wasn't that material. But again, the median EBITDA that we underwrote, the weighted averages were in line with prior quarters, sectors as well. So no, I'd say it was really more of the same.

但不，我想說的是，情況大致相同，我們資助了相當數量的 LVO。正如所提到的，我們領導或共同領導了我們在新交易活動方面所做的一切工作，我們對此感到自豪，我們繼續與一群真正高品質的私募股權公司開展業務。貸款成數略有下降。我不會去深究這一點。我認為那本質上更具情節性，而且不是那麼重要。但同樣，我們承保的中位數 EBITDA、加權平均值與前幾季和各行業一致。所以不，我想說它實際上大同小異。

Got it, thanks for that. And on leverage, it's now at the midpoint of your range. So where do you see it trending from here?

明白了，謝謝。就槓桿而言，它現在處於範圍的中間點。那麼您認為它的趨勢如何？

Yeah, obviously, we would like leverage to get a little bit higher but still within our target range. I think, at 111 somewhere between 115 and 120 is kind of where we would like to keep our leverage levels. But again, we're going to do so in a way that we're still sticking to our nit and our credit selection to get there.

是的，顯然，我們希望槓桿率稍微高一點，但仍在我們的目標範圍內。我認為，111 介於 115 和 120 之間是我們希望保持槓桿水平的水平。但同樣，我們仍將堅持我們的特色和信貸選擇，以實現這一目標。

Yeah. That's the key, I think, which is getting to the getting to our target leverage matters, of course, and that's the stated goal. And you may recall over a year ago when we IPOed, we told the market and you all that we were going to get upwards of 1 to 1 within three or four quarters. We did exactly that.

是的。我認為，這是關鍵，當然，達到我們的目標槓桿很重要，這就是既定目標。您可能還記得，一年多前我們首次公開發行 (IPO) 時，我們告訴市場和大家，我們將在三到四個季度內實現 1 比 1 以上的成長。我們確實這麼做了。

We weren't in a rush to do it. It's patient. We are making a loan is easy in short term feels great, but getting the money back is what matters most. And so, sticking to our knitting on credit will continue to be our primary focus here and optimizing the origination and diligence footprint that we have here at Morgan Stanley, it's very differentiating is what we're going to continue to do.

我們並不急於這麼做。很有耐心。我們貸款很容易，短期內感覺很好，但拿回錢才是最重要的。因此，堅持信貸編織將繼續成為我們的主要關注點，並優化我們在摩根士丹利的起源和盡職調查足跡，這是我們將繼續做的事情。

And it appears there are no further telephone questions. At this time, I'd like to turn the call back to Mr. Jeff Levin for closing remarks.

看起來沒有其他電話詢問了。現在，我想請傑夫·萊文先生作最後發言。

Thank you. On behalf of the management team, I greatly appreciate you joining us today along with your support of Morgan Stanley Direct Lending Fund. Our team remains focused on executing our defensive investment strategy to drive shareholder value, and I couldn't be more pleased with our continued execution. We're positioned to deliver strong returns for our shareholders and are pleased with how MSDL is positioned in this environment. We look forward to providing an update on our second quarter of 2025 earnings call in August. Thank you.

謝謝。我代表管理團隊非常感謝您今天的加入我們以及您對摩根士丹利直接貸款基金的支持。我們的團隊仍然專注於執行我們的防禦性投資策略，以推動股東價值，我對我們的持續執行感到非常滿意。我們致力於為股東帶來豐厚的回報，並對 MSDL 在這種環境下的定位感到滿意。我們期待在 8 月的 2025 年第二季財報電話會議上提供最新消息。謝謝。

And once again, that does conclude today's conference. We thank you all for your participation. You may now disconnect.

今天的會議再次結束了。我們感謝大家的參與。您現在可以斷開連線。