Blue Owl Capital Corp (OBDC) 2022 Q4 法說會逐字稿

Greetings. Welcome to Owl Rock Capital Corp.'s Fourth Quarter 2022 Earnings Call. (Operator Instructions) Please note this conference is being recorded. At this time, I'll now turn the conference over to Dana Sclafani, Head of Investor Relations. Dana, you may now begin.

問候。歡迎來到 Owl Rock Capital Corp. 的 2022 年第四季度財報電話會議。 （操作員說明）請注意正在錄製此會議。現在，我將把會議轉交給投資者關係主管 Dana Sclafani。達娜，你現在可以開始了。

Thank you, operator. Good morning, everyone, and welcome to Owl Rock Capital Corporation's fourth quarter earnings call. Joining me this morning are our Chief Executive Officer, Craig Packer, our Chief Financial Officer and Chief Operating Officer, Jonathan Lamm; and other members of our senior management team.

謝謝你，運營商。大家早上好，歡迎來到 Owl Rock Capital Corporation 的第四季度財報電話會議。今天早上和我一起來的有我們的首席執行官 Craig Packer、我們的首席財務官兼首席運營官 Jonathan Lamm；以及我們高級管理團隊的其他成員。

I'd like to remind our listeners that remarks made during today's call may contain forward-looking statements, which are not a guarantee of future performance or results and involve a number of risks and uncertainties that are outside the company's control. Actual results may differ materially from those in forward-looking statements as a result of a number of factors, including those described in ORCC's filings with the SEC.

我想提醒我們的聽眾，在今天的電話會議上發表的言論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，並且涉及公司無法控制的許多風險和不確定性。由於多種因素，包括 ORCC 向美國證券交易委員會提交的文件中描述的因素，實際結果可能與前瞻性陳述中的結果存在重大差異。

The company assumes no obligation to update any forward-looking statements. Certain information discussed on this call and in our earnings materials, including information related to portfolio companies, was derived from third-party sources and has not been independently verified. The company makes no such representations or warranties with respect to this information. ORCC's earnings release, 10-K and supplemental earnings presentation are available on the Investor Relations section of our website at owlrockcapitalcorporation.com.

公司不承擔更新任何前瞻性陳述的義務。本次電話會議和我們的財報材料中討論的某些信息（包括與投資組合公司相關的信息）來自第三方來源，未經獨立驗證。公司對這些信息不作任何此類陳述或保證。 ORCC 的收益發布、10-K 和補充收益介紹可在我們網站 owlrockcapitalcorporation.com 的投資者關係部分獲取。

With that, I'll turn the call over to Craig.

有了這個，我會把電話轉給克雷格。

Thanks, Dana. Good morning, everyone, and thank you all for joining us today. We are pleased to once again report another quarter of very strong results, with earnings momentum that reflects the continued pull-through of higher rates and the ongoing strong performance of our portfolio. Our net investment income in the fourth quarter was $0.41 per share, capping off a record year since we went public. To put this in perspective, NII increased 18% versus the fourth quarter of last year and over 30% in the second half of the year as we have seen the benefit of rising rates and stable credit performance. On our call last quarter, we highlighted that we expected to earn at least $0.39 of NII in the fourth quarter based on our visibility at the time.

謝謝，達娜。大家早上好，感謝大家今天加入我們。我們很高興再次報告另一個季度非常強勁的業績，其盈利勢頭反映了利率上升的持續推動以及我們投資組合的持續強勁表現。我們第四季度的淨投資收益為每股 0.41 美元，創下上市以來創紀錄的一年。從這個角度來看，NII 比去年第四季度增長了 18%，下半年增長了 30% 以上，因為我們已經看到了利率上升和信貸表現穩定的好處。在我們上個季度的電話會議上，我們強調，根據我們當時的知名度，我們預計在第四季度至少賺取 0.39 美元的 NII。

We are pleased to report even stronger results. As a reminder, we also announced several capital actions with our third quarter results, including a $0.02 increase in our base dividend to $0.33 and the introduction of a supplemental dividend component going forward. The supplemental dividend is equal to 50% of earnings in excess of our base dividend, and given our increase in NII, our supplemental dividend increased to $0.04 for the fourth quarter. As a result of this new dividend structure, investors will receive $0.37 in total dividends for the fourth quarter. At our current share price, this dividend level generates what we believe is a very compelling annualized dividend yield of over 11%.

我們很高興地報告更強大的結果。提醒一下，我們還宣布了第三季度業績的幾項資本行動，包括將基本股息增加 0.02 美元至 0.33 美元，以及未來引入補充股息部分。補充股息等於超過我們基本股息的收益的 50%，並且鑑於我們增加了 NII，我們第四季度的補充股息增加到 0.04 美元。由於這種新的股息結構，投資者將在第四季度獲得 0.37 美元的總股息。按照我們目前的股價，這一股息水平產生了我們認為非常引人注目的年化股息收益率，超過 11%。

Based on the visibility of higher rates flowing through the portfolio, we expect to see continued growth in NII and corresponding growth in the supplemental dividend throughout 2023. Our NII ROE for the fourth quarter was 11% up from 9.3% a year ago.

基於投資組合中更高利率的可見性，我們預計整個 2023 年 NII 將持續增長，補充股息將相應增長。我們第四季度的 NII ROE 為 11%，高於一年前的 9.3%。

For the full year 2022, we generated a 9.5% ROE, up 100 basis points from 2021. Looking forward, we expect to see run rate ROEs of 11% or higher, rates stay at current levels, which we think is an attractive risk-adjusted return for a primarily first lien portfolio. Last quarter, we also announced that our Board had authorized a $150 million repurchase program, which was in addition to a $25 million Blue Owl employee investment vehicle and the intention to purchase up to $75 million of stock in the near term through the combined buying power from these programs. We are pleased to have made significant progress on this goal to date, in part by utilizing a programmatic repurchase plan.

對於 2022 年全年，我們產生了 9.5% 的股本回報率，比 2021 年上升了 100 個基點。展望未來，我們預計股本回報率將達到 11% 或更高，利率將保持在當前水平，我們認為這是一個有吸引力的風險-主要是第一留置權投資組合的調整後回報。上個季度，我們還宣布董事會已批准一項 1.5 億美元的回購計劃，這是對 Blue Owl 員工 2500 萬美元投資工具的補充，並打算在短期內通過合併購買力購買高達 7500 萬美元的股票從這些程序中。我們很高興迄今為止在這一目標上取得了重大進展，部分是通過使用程序化回購計劃。

As of February 17, a total of $52 million of ORCC stock was purchased, of which $35 million was bought by the company at an average price of $12.05 per share or 81% of net asset value. We believe these capital actions underscore our alignment with shareholders while providing comfortable coverage of our base dividend. In addition to our strong earnings, net asset value per share also increased this quarter to $14.99, up $0.14 from the third quarter. Our nonaccrual rate remains low at 1.3% of the fair value of the portfolio with one name added to nonaccrual this quarter.

截至2月17日，總計購買了5200萬美元的ORCC股票，其中3500萬美元被公司以每股12.05美元的平均價格或81%的淨資產價值購買。我們相信這些資本行動強調了我們與股東的一致性，同時為我們的基本股息提供了可觀的覆蓋。除了我們強勁的收益外，本季度每股淨資產值也增加到 14.99 美元，比第三季度增加 0.14 美元。我們的非應計利率仍然很低，為投資組合公允價值的 1.3%，本季度非應計利率增加了一個名稱。

Since inception, we have deployed roughly $25 billion across 400 borrowers of which only 6 names have been placed on nonaccrual in our history, and our annualized loss ratio remains at less than 15 basis points. We believe our continued strong portfolio performance reflects our conservative underwriting standards and credit selection process. While we are pleased with the strong earnings of the fourth quarter, we are also cognizant that there will likely be new challenges for the economy as we look ahead. We expect broader economic headwinds and the potential for a recession later this year. We believe our portfolio is well positioned for this environment and our borrowers are already demonstrating resilience.

自成立以來，我們已經為 400 名借款人部署了大約 250 億美元，其中只有 6 個名字在我們的歷史上被置於非應計項目中，我們的年化損失率仍然低於 15 個基點。我們相信我們持續強勁的投資組合表現反映了我們保守的承保標準和信用選擇過程。雖然我們對第四季度的強勁收益感到高興，但我們也認識到，展望未來，經濟可能會面臨新的挑戰。我們預計今年晚些時候會出現更廣泛的經濟逆風和經濟衰退的可能性。我們相信我們的投資組合在這種環境下處於有利地位，我們的借款人已經表現出韌性。

Our borrowers continue to report low single-digit growth quarter-over-quarter on a revenue and EBITDA basis, although we note that the pace of growth has slowed versus prior quarters. Many of our borrowers have experienced relief from supply chain disruptions and saw a moderation in input costs, which has helped to offset the impact of rising rates and to support EBITDA growth. Despite this, we have not seen any pickup in the early indicators of stress across the portfolio. Our portfolio marks and internal ratings remained stable quarter-over-quarter. Anecdotally, we have not seen an increase to requests from borrowers for covenant lease or additional liquidity. We continue to utilize a rigorous monitoring process with our investment and portfolio management team of over 100 people. We have significant resources in place to proactively identify early signs of stress and mitigate potential challenges.

我們的借款人繼續報告收入和 EBITDA 的季度環比低個位數增長，儘管我們注意到增長速度與前幾個季度相比有所放緩。我們的許多藉款人都從供應鏈中斷中解脫出來，投入成本有所下降，這有助於抵消利率上升的影響並支持 EBITDA 增長。儘管如此，我們還沒有看到整個投資組合壓力的早期指標有任何回升。我們的投資組合標記和內部評級環比保持穩定。有趣的是，我們沒有看到借款人對契約租賃或額外流動性的要求有所增加。我們繼續對超過 100 人的投資和投資組合管理團隊採用嚴格的監控流程。我們擁有大量資源來主動識別壓力的早期跡象並減輕潛在挑戰。

Given the current market backdrop, we have a heightened focus on projected liquidity needs, and our continuously reunderwriting credits in evaluating downside and liquidation scenarios. As we expected, interest coverage declined to 2.3x in the fourth quarter and 2.5x the prior quarter. This is a reflection of higher rates. This metric is reported LTM coverage. However, we also monitor the forecasted peak rate environment based on current market expectations and have found that the vast majority of our borrowers are expected to maintain adequate coverage levels over the course of the year with average coverage remaining between 1.5x and 2x. We have a monthly watchlist session in which we evaluate both existing and newly identified situations where operating results are deviated from our expectations. Across our 184 portfolio companies, the vast majority continue to perform in line with expectations.

鑑於當前的市場背景，我們更加關注預計的流動性需求，並在評估下行和清算情景時不斷重新承銷信用。正如我們預期的那樣，利息覆蓋率在第四季度下降至 2.3 倍，比上一季度下降了 2.5 倍。這反映了更高的利率。該指標是報告的 LTM 覆蓋率。然而，我們還根據當前市場預期監測預測的峰值利率環境，並發現我們的絕大多數借款人預計將在一年中保持足夠的覆蓋率水平，平均覆蓋率保持在 1.5 倍至 2 倍之間。我們有一個每月的觀察列表會議，在會議上我們評估現有的和新發現的運營結果偏離我們預期的情況。在我們的 184 家投資組合公司中，絕大多數公司的業績繼續符合預期。

Based on our heightened monitoring, we identified less than 5% of the total portfolio on a fair value basis that we currently believe may experience more significant challenges over the next year or so. To be clear, we are not saying these 5% will have problems, but rather that our current view is the area of potential concern at this point is in this 5%, which we believe is an encouraging statement about the overall health of the portfolio. We continue to come away from our investment monitoring process, confidence in the portfolio and the strength of our underlying borrowers.

基於我們加強的監控，我們發現在公允價值基礎上不到總投資組合的 5%，我們目前認為在未來一年左右可能會遇到更大的挑戰。需要明確的是，我們並不是說這 5% 會出現問題，而是我們目前的觀點是目前潛在關注的領域是這 5%，我們認為這是對投資組合整體健康狀況的鼓舞人心的聲明.我們繼續遠離我們的投資監控流程、對投資組合的信心以及我們潛在藉款人的實力。

This confidence is bolstered by our belief that large sponsor-backed companies in recession-resistant sectors will fare better in a tougher environment. Even in situations with weaker credit performance, sponsors will employ operational initiatives, such as cutting costs for providing additional liquidity for strategic initiatives such as selling assets or making accretive acquisitions. In our experience, we have found that these actions can be impactful in extending the runway to realize value for sponsors and enhance the credit profile of the business to provide additional downside protection for us as a lender.

我們相信，在更艱難的環境中，抗衰退行業的大型贊助商支持的公司將表現得更好，從而增強了這種信心。即使在信用表現較差的情況下，發起人也會採取運營舉措，例如削減成本，為戰略舉措（如出售資產或進行增值收購）提供額外的流動性。根據我們的經驗，我們發現這些行動可以有效延長跑道以實現贊助商的價值並提高企業的信用狀況，從而為我們作為貸方提供額外的下行保護。

Looking forward, we are prepared for a more challenging economic environment. We believe any defaults or potential losses in our portfolio will be very manageable and offset by the continued strength of our earnings. We've built our portfolio to be resilient across varying environments and believe that it will fare well in the face of an economic downturn. We have deliberately built a highly diversified portfolio focused on primarily first lien investments with low loan-to-value ratios in noncyclical sectors and believe this is a highly defensible strategy and a slowing economy.

展望未來，我們已準備好迎接更具挑戰性的經濟環境。我們相信，我們投資組合中的任何違約或潛在損失都將是可控的，並會被我們持續強勁的收益所抵消。我們已經建立了我們的投資組合，使其能夠在不同的環境中保持彈性，並相信它會在經濟低迷的情況下表現良好。我們特意建立了一個高度多元化的投資組合，主要專注於非週期性行業中貸款價值比率較低的優先留置權投資，並相信這是一種高度防禦性的策略和放緩的經濟。

With that, I'll turn it over to Jonathan to provide more detail on our financial results.

有了這個，我將把它交給喬納森，以提供有關我們財務業績的更多細節。

Thanks, Craig. We ended the fourth quarter with total portfolio investments of $13 billion, outstanding debt of $7.4 billion and total net assets of $5.9 billion. Our NAV per share was $14.99, an increase from our third quarter NAV of $14.85. This increase was driven by over-earning the regular dividend and strong credit performance. Additionally, we saw a meaningful increase in the value of some of our strategic equity positions, which benefited NAV in the fourth quarter. Funded activity in the quarter was modest at approximately $200 million as we match new deployments to our repayment activity, which remains muted in line with the broader slowdown in M&A and refinancing activity.

謝謝，克雷格。第四季度結束時，我們的投資組合總額為 130 億美元，未償債務為 74 億美元，淨資產總額為 59 億美元。我們的每股資產淨值是 14.99 美元，比第三季度的 14.85 美元有所增加。這一增長是由超額賺取定期股息和強勁的信貸表現推動的。此外，我們看到我們的一些戰略股權頭寸的價值顯著增加，這有利於第四季度的資產淨值。本季度的融資活動規模不大，約為 2 億美元，因為我們將新部署與我們的還款活動相匹配，這與併購和再融資活動的更廣泛放緩保持一致。

Turning to the income statement. Our continued strong fourth quarter performance drove record investment income for 2022, up 18% from the prior year. This increase was driven by higher base rates and from higher average spread in the portfolio. While we have benefited from higher rates, we have also been diligently working to increase the spread in the portfolio while maintaining the majority of our portfolio in first lien investments. As a result, the average asset yield in the portfolio increased over 300 basis points to 11% in 2022.

轉向損益表。我們在第四季度的持續強勁表現推動了 2022 年創紀錄的投資收入，比上年增長 18%。這一增長是由更高的基準利率和投資組合中更高的平均利差推動的。雖然我們從更高的利率中受益，但我們也一直在努力增加投資組合的利差，同時將我們的大部分投資組合維持在優先留置權投資中。因此，到 2022 年，投資組合的平均資產收益率增加了 300 多個基點，達到 11%。

From an earnings perspective, we expect the average base rate of our portfolio will continue to increase over the first half of the year as borrowers reset to current rates. Our average base rate for the fourth quarter was 3.7%, and the average base rate elected at the end of the fourth quarter was 4.3%. This implies a pull-through of an additional 60 basis points in the first quarter. As a reminder, holding all else equal, we expect each additional 100 basis points increase in our effective base rate to generate approximately $0.04 per share in quarterly NII after considering the impact of income-based fees.

從收益的角度來看，我們預計我們投資組合的平均基準利率將在今年上半年繼續增加，因為藉款人將重新調整為當前利率。我們第四季度的平均基準利率是 3.7%，第四季度末當選的平均基準利率是 4.3%。這意味著第一季度將額外增加 60 個基點。提醒一下，在其他條件相同的情況下，我們預計在考慮基於收入的費用的影響後，我們的有效基本利率每增加 100 個基點，將在季度 NII 中產生約每股 0.04 美元。

For the first quarter of 2023, our Board declared a $0.33 per share regular dividend which will be paid on or before April 14 to shareholders of record as of March 31. For the fourth quarter of 2022, our Board declared a supplemental dividend of $0.04 per share, which is 50% of the difference between the $0.41 fourth quarter NII and our previously declared $0.33 per share fourth quarter dividend. This supplemental dividend will be paid on March 17 to shareholders of record on March 3.

對於 2023 年第一季度，我們的董事會宣布了每股 0.33 美元的定期股息，該股息將於 4 月 14 日或之前支付給截至 3 月 31 日在冊的股東。對於 2022 年第四季度，我們的董事會宣布了每股 0.04 美元的補充股息份額，這是第四季度 0.41 美元的 NII 與我們之前宣布的每股 0.33 美元的第四季度股息之間差額的 50%。該補充股息將於 3 月 17 日支付給 3 月 3 日登記在冊的股東。

Turning to the balance sheet. We continue to have a flexible balance sheet with a well-diversified financing structure. At quarter end, our net leverage remains within our target range at 1.19x net debt to equity largely unchanged from where we ended the third quarter. We also had liquidity of $1.8 billion, well in excess of our unfunded commitments of approximately $1 billion, roughly half of which are revolvers. With only 50% of our liabilities exposed to rising rates, our weighted average total cost of debt remains low at 5.2%, and we have no near-term maturities.

轉向資產負債表。我們繼續擁有靈活的資產負債表和多元化的融資結構。在季度末，我們的淨槓桿率保持在我們的目標範圍內，即 1.19 倍的淨債務與權益之比，與我們第三季度末的水平基本持平。我們還有 18 億美元的流動資金，遠遠超過我們約 10 億美元的無資金承諾，其中大約一半是循環貸款。由於我們只有 50% 的負債面臨利率上升的風險，我們的加權平均總債務成本仍然很低，為 5.2%，而且我們沒有短期到期的債務。

With that, I'll turn it back to Craig for closing comments.

有了這個，我會把它轉回 Craig 以徵求結束意見。

Thanks, Jonathan. I'll close with some thoughts on how ORCC is positioned today and what we're expecting for the year ahead. We are seeing the earnings power of the business, and we expect to see further earnings growth over the year as we benefit from higher base rates. The portfolio is generating very attractive risk-adjusted asset yields and we have worked hard to position it for success entering this environment, not just through careful credit selection but also by identifying and exercising multiple strategic levers, which have allowed us to optimize earnings. We increased the overall portfolio spread by roughly 20 basis points over the last year, in part by opportunistically rotating out of investments with spreads less than 550 basis points. And more recently, we've been able to take advantage of the market backdrop to reunderwrite investments and increase spreads to add on an amendment requests, which we negotiate to reflect current market terms.

謝謝，喬納森。最後，我將就 ORCC 今天的定位以及我們對未來一年的期望發表一些想法。我們看到了該業務的盈利能力，並且由於我們受益於更高的基準利率，我們預計今年的盈利將進一步增長。該投資組合正在產生非常有吸引力的風險調整後資產收益率，我們努力將其定位為成功進入這種環境，不僅通過謹慎的信貸選擇，而且通過確定和運用多種戰略槓桿，這使我們能夠優化收益。與去年相比，我們將整體投資組合利差增加了大約 20 個基點，部分原因是機會主義地退出利差低於 550 個基點的投資。最近，我們已經能夠利用市場背景重新承銷投資並增加利差以增加修改請求，我們協商這些請求以反映當前的市場條款。

We have also made prudent investments in strategic opportunities, including Wingspire and the Senior Loan Fund, which are each diversified portfolios of loans that generate over 10% ROEs and provide differentiated returns to the portfolio. More recently, we have also made select equity investments in businesses like Amergin and Fifth Season that we expect to enhance earnings and provide strong returns over time. We have locked in low-cost liabilities through our proactive approach to financing the portfolio. As Jonathan noted earlier, half of our liabilities are fixed rate.

我們還對戰略機會進行了謹慎的投資，包括 Wingspire 和 Senior Loan Fund，它們都是多元化的貸款組合，產生超過 10% 的股本回報率，並為投資組合提供差異化的回報。最近，我們還對 Amergin 和 Fifth Season 等企業進行了精選的股權投資，我們希望隨著時間的推移提高收益並提供強勁的回報。我們通過積極主動的投資組合融資方式鎖定了低成本負債。正如喬納森之前指出的那樣，我們一半的負債是固定利率的。

As a result, we believe ORCC is well positioned to continue generating outsized returns in today's environment. Earnings continue to expand, and we expect to see the benefit of higher rates play out more in the first half of the year. It's also worth noting that this is a period of very low repayment activity, resulting in minimal repayment income. When rates eventually normalize, we expect to see a pickup in repayment activity and an increase in repayment income. The company is performing well, and we are confident in the portfolio's resiliency even in a more challenging economic environment.

因此，我們相信 ORCC 處於有利地位，可以在當今環境中繼續產生超額回報。收益繼續擴大，我們預計利率上升的好處將在今年上半年發揮更大作用。還值得注意的是，這是一個還款活動非常低的時期，導致還款收入微乎其微。當利率最終正常化時，我們預計會看到還款活動的回升和還款收入的增加。該公司表現良好，即使在更具挑戰性的經濟環境中，我們也對投資組合的彈性充滿信心。

We are excited about the future of ORCC and the ways in which we are delivering differentiated returns to shareholders. We are pleased to announce we are hosting our first Investor Day in May and look forward to sharing more detail with investors on why we are confident that ORCC will deliver attractive returns across evolving market environments. Dana will be sharing more details in the coming weeks, and we hope that many of you on the call will be able to join us.

我們對 ORCC 的未來以及我們為股東提供差異化回報的方式感到興奮。我們很高興地宣布我們將在 5 月舉辦我們的第一個投資者日，並期待與投資者分享更多細節，說明我們為什麼相信 ORCC 將在不斷變化的市場環境中提供有吸引力的回報。 Dana 將在未來幾週內分享更多詳細信息，我們希望電話會議中的許多人能夠加入我們。

With that, as always, thank you for your time today, and we will now open the line for questions.

就此一如既往，感謝您今天抽出寶貴時間，我們現在將開放提問熱線。

(Operator Instructions)

（操作員說明）

And our first question is from the line of Casey Alexander with Compass Point.

我們的第一個問題來自 Compass Point 的 Casey Alexander。

I have 2 questions. First of all, in your press release, it shows that you breakdown the asset structure of the portfolio between preferred equity and common equity over 10% of the investments dedicated to equity investments. I think that a novice investor picking this up might say that, that's a fairly high level. But I think a lot of that is covered by asset-backed lending and off-balance sheet vehicles. If you were to carve those out, how much of the portfolio would you characterize as being true equity as opposed to being equity that's actually fronting for interest-earning investments?

我有兩個問題。首先，在你的新聞稿中，它表明你將超過 10% 的投資用於股權投資，將投資組合的資產結構細分為優先股和普通股。我認為選擇這個的新手投資者可能會說，這是一個相當高的水平。但我認為其中很多都被資產支持貸款和資產負債表外工具所覆蓋。如果你要將它們分開，你會認為投資組合中有多少是真正的股權，而不是實際上面向生息投資的股權？

Sure. Casey, I'll start and Jonathan can fill in what I've missed. I'm glad that you asked the question because I agree that if you weren't close to our company, it could create the wrong impression. The largest pieces of those investments are investments in portfolios of secured loans, just like sitting on our balance sheet today. As you know, we've got a large investment in a business called Wingspire which does asset-based lending, very conservative asset-based lending. And so we -- ORCC owns almost 90% of Wingspire so that shows up as an equity investment. But what you're getting is a highly diversified portfolio of asset-based loans that generate very consistent dividends. Similarly -- and that's about a $400 million investment, give or take. The next biggest piece is our Senior Loan Fund, we used to call it Sebago Lake, a couple of years ago, we changed the names.

當然。凱西，我會開始，喬納森可以填補我遺漏的內容。很高興您提出這個問題，因為我同意，如果您與我們公司關係不密切，可能會給人留下錯誤的印象。這些投資中最大的部分是對擔保貸款組合的投資，就像我們今天的資產負債表上一樣。如您所知，我們對一家名為 Wingspire 的企業進行了大量投資，該公司從事基於資產的貸款，非常保守的基於資產的貸款。所以我們 - ORCC 擁有 Wingspire 近 90% 的股份，因此顯示為股權投資。但您得到的是高度多樣化的資產貸款組合，這些組合會產生非常穩定的股息。同樣——這大約是一筆 4 億美元的投資，無論是給予還是接受。下一個最大的部分是我們的高級貸款基金，我們過去稱其為 Sebago Lake，幾年前我們更改了名稱。

Similarly, that investment is in a large portfolio of first lien senior secured term loans with really terrific credit performance and we own about 90% of that as well. And so those portfolios generate income, just like everything else in our book, and we -- ORCC gets 90% of that income essentially through dividends. Those are by far the biggest pieces. We have very little what you might consider like pure equity investment. The preferreds we do are also, we think, very predictable and high quality. They tend to be very large sponsor-backed companies where we are being, given the opportunity and we like the opportunity to structure a preferred typically through about 50% loan-to-value. So significant equity beneath this from the sponsor for very large companies, $200 million, $300 million, $400 million of EBITDA, if not more, that generate very consistent dividend streams. So those are the biggest components and it's a part of the book that I think is very accretive to our overall earnings and our performance and the underliers have been very consistent.

同樣，該投資是在信用表現非常出色的第一留置權高級擔保定期貸款的大型投資組合中，我們也擁有其中約 90% 的股份。因此，這些投資組合會產生收入，就像我們書中的其他一切一樣，而我們——ORCC 基本上通過股息獲得了 90% 的收入。這些是迄今為止最大的部分。我們幾乎沒有您可能認為的純股權投資。我們認為，我們所做的首選也是非常可預測和高質量的。如果有機會，他們往往是我們所處的非常大的讚助商支持的公司，我們希望有機會通常通過大約 50% 的貸款價值來構建首選。非常大的公司的讚助商在這之下的大量股權，2 億美元、3 億美元、4 億美元的 EBITDA，如果不是更多的話，這會產生非常穩定的股息流。因此，這些是最大的組成部分，也是本書的一部分，我認為這對我們的整體收益和我們的業績非常有幫助，而且底層一直非常一致。

Casey, if you were to just strip those items out and just look at what's remaining in common equity, it's about 4%. So it's a much lower number.

凱西，如果你只是剝離這些項目，看看普通股中剩下的是什麼，大約是 4%。所以這是一個低得多的數字。

All right. Great. That's very helpful. Secondly, we know that Applied-Cleveland went on nonaccrual this quarter. And yet the mark on it quarter-over-quarter changed very little. Could you contour your confidence in that mark, given the fact that you've taken it on nonaccrual and kind of give investors an update as to what your plans are there?

好的。偉大的。這很有幫助。其次，我們知道 Applied-Cleveland 本季度繼續保持非應計收益。然而，它的季度環比變化很小。考慮到您已經將其視為非應計收益並向投資者提供有關您的計劃的最新信息，您能否勾勒出您對該標記的信心？

Sure. So Applied-Cleveland, it shows up on our schedule of investments with a different name, FR Arsenal Holdings. It's a business that provides inspection services and consulting services to energy and infrastructure companies. It's been in our portfolio for a handful of years. We know the company quite well. It was impacted by COVID, which reduced demand for their services, given the energy price declines it was current in its interest payment to us during the quarter, but there was a maturity coming up, and we made a judgment that we did see an easy path for us to get refinanced. As a consequence, we put it on nonaccrual. You may have seen or if you haven't seen, you'll see some public disclosure a subsidiary of the company.

當然。所以 Applied-Cleveland，它出現在我們的投資計劃中，名稱不同，FR Arsenal Holdings。它是一家為能源和基礎設施公司提供檢查服務和諮詢服務的企業。它已經在我們的投資組合中存在了幾年。我們非常了解這家公司。它受到了 COVID 的影響，鑑於能源價格下降，它在本季度向我們支付的利息中目前正在下降，這減少了對他們服務的需求，但即將到期，我們判斷我們確實看到了一個簡單的我們獲得再融資的途徑。因此，我們把它放在非應計項目上。你可能已經看到或者如果你沒有看到，你會看到一些公開披露的公司的子公司。

So one of their businesses, not the whole company, filed for bankruptcy for some particular technical reasons. But the overall company is solvent if you will. We're working closely with the company and the sponsor to take actions for us to generate repayment. And so the mark reflects our confidence in our ability to get a very high recovery, if you will, if not par, hopefully, very close to par despite the fact that we have it on nonaccrual. Just as a reminder, for folks that are newer to us, we mark every name, every quarter. We use a third-party Duff & Phelps to do that. Same process since inception.

因此，由於某些特定的技術原因，他們的一個業務而不是整個公司申請破產。但如果你願意的話，整個公司是有償付能力的。我們正在與公司和讚助商密切合作，採取行動讓我們產生回報。因此，該標記反映了我們對我們獲得非常高的回收率的能力的信心，如果你願意，如果不是標準桿，希望非常接近標準桿，儘管我們有它是非應計的。提醒一下，對於我們的新人，我們每個季度都會標記每個名字。我們使用第三方 Duff & Phelps 來做到這一點。自成立以來的相同過程。

Duff has marked this name probably 22x in our history, and we work extremely closely with them. And I think that it's a fair observation to wonder why the mark is not lower despite the nonaccrual but we believe even in situations where there is a nonaccrual that we will get very high recovery levels and we're working closely with the management team here and I don't want to overpromise, but I think over the next 6 to 9 months, you'll see how this plays out, and I think it will land in a reasonable place for us.

在我們的歷史上，達夫 (Duff) 已經將這個名字標記了 22 次，我們與他們的合作非常密切。而且我認為，儘管有非應計利潤，但我想知道為什麼分數沒有降低是一個公平的觀察，但我們相信，即使在有非應計利潤的情況下，我們也會獲得非常高的恢復水平，我們正在與這裡的管理團隊密切合作，我不想過度承諾，但我認為在接下來的 6 到 9 個月內，你會看到結果如何，我認為它會落在對我們來說合理的位置。

All right. Great. And lastly, the Senior Lending Fund, the JV, is kind of much smaller as a percentage of assets than we typically see in BDCs that use JV vehicle. Is there room to grow that? Do you plan to grow that? Or are you simply comfortable with the size of that particular sleeve as we sit today.

好的。偉大的。最後，高級貸款基金 JV 佔資產的百分比比我們通常在使用 JV 車輛的 BDC 中看到的要小得多。有增長的空間嗎？你打算種植它嗎？或者您只是對我們今天坐的那個特定袖子的尺寸感到滿意。

It's a great question. We've committed $500 million. We have funded about $320 million of that. So in the short term, we certainly expect to continue to invest the remainder of our commitment. I would be very open, and I think you should expect that over time, we will continue to grow this investment. It generates really attractive returns for ORCC north of 10%. As I mentioned, it's just a portfolio of senior secured loans. And so I expect us to grow it over time. Just to make reference back to it, we commented we're going to have our first Investor Day this May. And this is a topic that you should expect us to spend a lot of time on. I think that we have the ability to drive returns higher in the portfolio, not only by growing the senior loan fund, but also by growing our exposure to Wingspire and a couple of our other more structured investments. I think they're very accretive.

這是一個很好的問題。我們已承諾投入 5 億美元。我們已經資助了其中的大約 3.2 億美元。因此，在短期內，我們當然希望繼續投資剩餘的承諾。我會非常開放，我認為你應該期待隨著時間的推移，我們將繼續增加這項投資。它為 ORCC 帶來了 10% 以上的非常有吸引力的回報。正如我所提到的，它只是高級擔保貸款的組合。所以我希望我們能隨著時間的推移而增長。只是為了回顧它，我們評論說我們將在今年 5 月舉辦我們的第一個投資者日。這是一個你應該期待我們花很多時間的話題。我認為我們有能力提高投資組合的回報率，不僅可以通過增加高級貸款基金，還可以通過增加我們對 Wingspire 和其他一些結構性更強的投資的敞口。我認為它們非常具有增值性。

I think we're very deliberate about how we do it. I think it's worked out extremely well, and we will continue to add to it. Collectively, those investments today are about 6% of the portfolio. Over time, I don't see any reason why that couldn't get to be 10% plus. Again, we'll talk more about that at our Investor Day. But it just shows our ability to continue to drive returns higher in the portfolio.

我認為我們對如何做是非常慎重的。我認為它的效果非常好，我們將繼續添加它。總的來說，今天這些投資約佔投資組合的 6%。隨著時間的推移，我看不出有什麼理由不能超過 10%。同樣，我們將在投資者日更多地討論這一點。但這只是表明我們有能力繼續提高投資組合的回報率。

Our next question comes from the line of Robert Dodd with Raymond James.

我們的下一個問題來自 Robert Dodd 和 Raymond James 的對話。

On Wingspire. I mean, obviously, it's been very successful for you so far. When you did invest a little bit more capital in it this quarter, they tell you, you vote the fair value up a little bit, but the dividend did drop. So can you give us any color -- what do you expect the long-term return on invested capital to be from that asset given it is 400 million of assets equity, but it's income-producing equity as you've already discussed. I mean what's the long-term ROIC that can be sustained from that business?

在 Wingspire 上。我的意思是，顯然，到目前為止，它對你來說非常成功。當你在這個季度投入了更多的資金時，他們告訴你，你投票公允價值一點點，但股息確實下降了。那麼你能給我們任何顏色嗎 - 你認為該資產的長期投資資本回報是什麼，因為它是 4 億美元的資產權益，但正如你已經討論過的那樣，它是創收權益。我的意思是該業務可以維持的長期 ROIC 是多少？

So look, Wingspire has been really pleased with our investment in Wingspire and what we've created there and the quality of the loans that they're writing, the quality of the team. As you will recall, we did an acquisition in that business for an equipment finance business, which got integrated very nicely. This should be a -- and certainly north of 10%, 11-plus percent, 12% return on equity investment. In any one quarter, the dividend might be $1 million or $2 million higher or lower. We did do the Liberty acquisition there. But I wouldn't read anything into 1 quarter. So dividend being down by $1 million or $2 million. I would expect over the course of the year that, that dividend will increase and will generate certainly north of 10%, but hopefully more like 11% or 12% return.

所以看，Wingspire 對我們對 Wingspire 的投資以及我們在那裡創造的東西以及他們正在編寫的貸款的質量以及團隊的質量感到非常滿意。你會記得，我們在該業務中收購了一家設備融資業務，整合得非常好。這應該是——而且肯定超過 10%、11% 以上、12% 的股權投資回報率。在任何一個季度，股息可能高出或低於 100 萬美元或 200 萬美元。我們確實在那裡收購了 Liberty。但我不會在 1 個季度內閱讀任何內容。所以股息減少了 100 萬或 200 萬美元。我預計在這一年中，股息將會增加，並且肯定會產生 10% 以上的回報率，但希望更接近 11% 或 12% 的回報率。

And I think we're creating real enterprise value by the business we've created. Organically, and I think David Wisen and the team Wingspire deserve a lot of credit. We built this from scratch with a clean sheet of paper, a business that we think is valuable today, and we'll have more value over time, and we'll generate a very consistent income stream to ORCC.

我認為我們正在通過我們創建的業務創造真正的企業價值。有機地，我認為 David Wisen 和 Wingspire 團隊值得稱讚。我們用一張乾淨的紙從頭開始建立這個，我們認為今天有價值的業務，隨著時間的推移我們將擁有更多價值，我們將為 ORCC 產生非常穩定的收入流。

I mean to your point, you did say last quarter, you said $0.39 or at least $0.39. My guess is you probably thought prepayment income was actually going to be a little higher than this quarter being $0.41 with very anemic prepay income is a very strong NII quarter. So what -- was there anything that surprised you, so to speak. Because we're $0.41, obviously, well above $0.39, at least $0.39, despite the fact that prepay income was so low. So what were the -- what were the uptick drivers that kind of pushed it into the above $0.40.

我的意思是你的意思是，你上個季度確實說過，你說 0.39 美元或至少 0.39 美元。我的猜測是你可能認為預付款收入實際上會比本季度高一點，即 0.41 美元，預付款收入非常低，這是一個非常強勁的 NII 季度。那麼，可以這麼說，有什麼讓您感到驚訝的事情嗎？因為我們是 0.41 美元，顯然，遠高於 0.39 美元，至少 0.39 美元，儘管預付收入如此之低。那麼是什麼 - 將其推高至 0.40 美元以上的上漲驅動因素是什麼。

So I don't think there are any significant surprises, Robert. What I hope is those that watch us closely now for 7 years, we try to under promise and over deliver. I was very deliberate that we said at least $0.39. I know most of the estimates were at $0.40, I think that this portfolio has tremendous operating momentum. The rates are going through. It's driving earnings. And in our script earlier today, we talked about further increases in the first quarter. and that's all despite no repayment.

所以我認為沒有任何重大驚喜，羅伯特。我希望那些現在密切關注我們 7 年的人，我們盡量少承諾，多兌現。我是故意說至少 0.39 美元的。我知道大部分的估計是 0.40 美元，我認為這個投資組合具有巨大的運營勢頭。費率正在發生。它正在推動收益。在我們今天早些時候的劇本中，我們談到了第一季度的進一步增長。儘管沒有還款，但這就是全部。

So we're not naturally disposed to give out guidance. I think given where our stock is traded, I think that instinctively, we want to make sure our investors understand the strength of what we've built. So we put out the guidance we did. We certainly wanted to make sure if we did that, that we would deliver on what we said. So no big surprises. Portfolio continues to do well. I expect NII to be up in the first quarter, just based on rolling through the higher rates that we've already -- the companies have already experienced and our continued strong credit performance.

所以我們自然不會傾向於給出指導。我認為考慮到我們股票的交易地點，我認為本能地，我們希望確保我們的投資者了解我們所建立的實力。所以我們發布了我們所做的指導。我們當然想確保如果我們這樣做，我們會兌現我們所說的。所以沒有什麼大驚喜。投資組合繼續表現良好。我預計 NII 將在第一季度上升，這只是基於我們已經經歷過的更高利率——公司已經經歷過的以及我們持續強勁的信貸表現。

Next question is from the line of Ryan Lynch with KBW.

下一個問題來自 KBW 的 Ryan Lynch。

First question I had was you mentioned in your prepared comments, less than 5% of your current portfolio may experience some problems in the future. And again, that's not a guarantee or anything like that, but those are kind of the investments you may be monitoring closely. I'm just curious, can you maybe help clarify -- are those businesses experiencing problems with the fundamentals of their business weakening potentially? Or is it more a combination of higher leverage and pressure in their earnings profile from higher rates or some combination of those 2 fundamentals and higher rates that are having you more concerned with that small subset of your portfolio?

我的第一個問題是你在準備好的評論中提到，你目前的投資組合中只有不到 5% 可能會在未來遇到一些問題。再一次，這不是保證或類似的東西，但這些是你可能密切關注的投資。我只是好奇，你能不能幫忙澄清一下——這些企業是否遇到了業務基礎可能減弱的問題？還是更高的槓桿率和更高利率帶來的收益壓力的結合，或者這兩個基本面和更高利率的某種組合讓你更關心你投資組合的一小部分？

Sure. Thanks, Ryan. Look, we know probably topic 1 on investors' minds is how the portfolio is going to hold up in a world where rates are much higher and potential weakening of the economy later this year. We are all over our portfolio and just -- that's just the way we operate since inception. And so scrubbing our portfolio happens every quarter since inception, watch what happens every month. And so -- and we very consistently have had a watch list of about 10% of the portfolio.

當然。謝謝，瑞安。看，我們知道投資者心目中的第一個話題可能是投資組合將如何在今年晚些時候利率高得多且經濟可能走弱的世界中保持下去。我們遍布我們的投資組合，這就是我們自成立以來的運作方式。因此，自成立以來每個季度都會對我們的投資組合進行清理，看看每個月會發生什麼。所以——我們一直都有大約 10% 的投資組合的觀察名單。

Those are companies that generally have underperformed for various credit specific reasons. But in this environment, given that heightened concern from investors about what might happen with higher rates in a weakening economy, we wanted to offer further insight that within that 10%, there's only about half of it that we would say we're really concerned about. And why is that to the guts of your question, I'd say it tends to be just challenges in the business themselves, operational issues that might come from all the factors you might expect labor costs or material costs or weakening demand specific to a company, not any broader themes, coupled with higher debt service.

這些公司通常由於各種信用特定原因而表現不佳。但在這種環境下，鑑於投資者更加擔心經濟疲軟時利率上升可能會發生什麼，我們想提供進一步的見解，即在這 10% 的範圍內，只有大約一半是我們真正擔心的關於。為什麼這是你問題的核心，我想說這往往只是業務本身的挑戰，運營問題可能來自你可能預期的勞動力成本或材料成本或公司特定需求減弱的所有因素，沒有任何更廣泛的主題，加上更高的償債能力。

And so the higher debt service obviously is going to take a weaker business that was potentially struggling now and really put pressure on it. And so we're acknowledging that we would expect to see some pickup in stress in the portfolio, but hopefully, folks take comfort that we're really only talking about less than 2 handfuls of companies. So it's credit specific, coupled with higher debt service is the underlying theme for those businesses.

因此，更高的償債率顯然會讓一家實力較弱的企業陷入困境，而這家企業現在可能正在苦苦掙扎，並真正給它帶來壓力。因此，我們承認我們希望看到投資組合的壓力有所增加，但希望人們感到安慰，因為我們實際上只談論不到 2 家公司。因此，它是特定於信用的，加上更高的償債能力是這些企業的基本主題。

I really don't sit here -- I'm not sitting here thinking like we're going to have a problem of every single one. They -- each have their own plans to address their concerns. But I'd rather just share some context so investors can make decisions about the portfolio overall and hopefully take some comfort with a relatively small -- low number.

我真的不是坐在這裡——我不是坐在這裡想著我們每個人都會遇到問題。他們——每個人都有自己的計劃來解決他們的擔憂。但我寧願只是分享一些背景信息，這樣投資者就可以就整體投資組合做出決定，並希望能從相對較小的數字中得到一些安慰。

I appreciate you shared that information, and it's helpful to kind of frame things regarding your portfolio. The other question I had, focusing on the credit team because that's very important in this environment. I believe you said that you're not really seeing a pickup in early indicators of stress in your portfolio thus far. I'd love to just hear what sort of metrics or indicators that you all monitor as those early signs of stress?

我很感激你分享了這些信息，這有助於構建關於你的投資組合的東西。我的另一個問題是關注信貸團隊，因為這在這種環境下非常重要。我相信你說過，到目前為止，你並沒有真正看到投資組合壓力的早期指標有所回升。我很想听聽你們都監測什麼樣的指標或指標作為壓力的早期跡象？

Sure. I mean it's a handful of things. Obviously, companies that come to us that are going to violate covenants in a material way that are going to result in a difficult negotiation. I think that's not happening now in a meaningful way. But when that happens, that's certainly 1 factor. Companies that -- companies are drawing on their revolvers because they need the liquidity in a meaningful way. Obviously, COVID, we saw that very dramatically. We're not seeing any change in behavior whatsoever for companies drawing revolvers, request for PIK to take our cash pay interest and make a PIK because of liquidity pressures. We're not seeing any pickup in that.

當然。我的意思是這是少數事情。顯然，來找我們的公司將以實質性方式違反契約，這將導致艱難的談判。我認為這並沒有以一種有意義的方式發生。但是當這種情況發生時，那肯定是一個因素。公司 - 公司正在使用他們的左輪手槍，因為他們需要以有意義的方式流動性。顯然，COVID，我們非常戲劇性地看到了這一點。由於流動性壓力，我們沒有看到任何提取左輪手槍的公司的行為發生任何變化，要求 PIK 收取我們的現金支付利息並製作 PIK。我們沒有看到任何回升。

I mean, obviously, defaults for sure, but those are the tangible things, but I'd say more broadly, we're not -- not only we've not had those things, but we're not having a lot of elevated conversations around the potential for them. There's always some discussion in the portfolio. But the amendments we're doing, for the most part are garden variety amendments. And there's not these like deep drawn out, hard conversations with a company that's suffering where we're grinding out something that might result in a bad credit outcome. I'm just not seeing it yet. And again, I expect some pickup in the course of the year. It'd be unrealistic to think not, but I think folks should take some comfort that there really isn't much right now. And -- and I don't expect any next week either, but those are some of the factors that we look at. I don't know if that helps.

我的意思是，顯然，默認是肯定的，但這些是有形的東西，但我想更廣泛地說，我們不是——不僅我們沒有這些東西，而且我們沒有很多提升圍繞他們的潛力進行對話。投資組合中總是有一些討論。但我們正在做的修正案，大部分是普通修正案。沒有像與一家正在遭受苦難的公司進行深入、艱苦的對話，我們正在研究可能導致不良信用結果的東西。我只是還沒有看到它。再一次，我希望在這一年中有所回升。不這麼認為是不現實的，但我認為人們應該感到安慰，因為現在確實沒有多少。而且——我預計下周也不會，但這些是我們關注的一些因素。我不知道這是否有幫助。

Next question is from the line of Kevin Fultz with JMP.

下一個問題來自 JMP 的 Kevin Fultz。

So on Slide 10 of the presentation to asset mix of new fundings and I see that common equity was about 46% of funding activity in the fourth quarter...

因此，在新融資資產組合演示文稿的幻燈片 10 中，我看到普通股佔第四季度融資活動的 46% 左右……

Kevin, sorry, Kevin, sorry to interrupt, it's really -- it's a little hard to make out -- hear you. Is there any way you could tweak your microphone or something?

凱文，對不起，凱文，很抱歉打斷你，真的——有點難以聽清——聽到你說話了。有什麼辦法可以調整你的麥克風之類的嗎？

Can you hear me better now?

你現在能聽得更清楚了嗎？

Yes. It's way better. Thanks a lot.

是的。好多了。多謝。

I believe that, that was driven by an increased investment increment to Fifth Season investments, could you provide a high-level overview of Fifth Season...

我相信，這是由第五季投資增加的投資推動的，您能否提供對第五季的高級概述......

Sure Kevin, that part where we could hear you, that part of the front, we kind of need that again. Sorry about that.

當然，凱文，我們可以聽到你的那部分，前面的那部分，我們又需要它了。對於那個很抱歉。

Sure. Sure, no problem. I was saying Slide 10 in the presentation shows the asset mix of new funding. And I see your common equity was about 46% of funding activity in the fourth quarter. I believe that was driven by increased investment increment to Fifth Season Investments. I was just curious if you could provide a high level overview of Fifth Season's business as well as the opportunity that led you to invest in the company.

當然。好沒問題。我在演示文稿中說幻燈片 10 顯示了新資金的資產組合。我看到你的普通股在第四季度的融資活動中約佔 46%。我認為這是由 Fifth Season Investments 的投資增量增加所推動的。我只是想知道您是否可以提供有關 Fifth Season 業務的高級概述以及導致您投資該公司的機會。

Sure. So we had -- we've been talking about some of these more structured investment opportunities. A couple of quarters ago, we made an investment in Fifth Season with a very experienced management team, Fifth Season, it's a life settlements business. Essentially, they offer consumers who have life insurance policies who don't have an easy way to get liquidity from -- on those policies from their insurance companies. They offer to -- a way to get liquidity on those policies. So it's a business that consumers like. We don't originate direct from consumers, we work with middleman.

當然。所以我們 - 我們一直在談論其中一些更結構化的投資機會。幾個季度前，我們與一支經驗豐富的管理團隊一起對 Fifth Season 進行了投資，Fifth Season 是一項人壽保險業務。從本質上講，他們為擁有人壽保險單的消費者提供無法從其保險公司獲得流動性的簡單方法。他們提供了一種方法來獲得這些政策的流動性。所以這是消費者喜歡的生意。我們不直接來自消費者，我們與中間商合作。

But it's a non-correlated asset class that we think can generate very nice returns to our portfolio, working with a very experienced management team. They had -- it's a little bit complicated, and I'm not sure worth going into a great amount of detail. We were working with them. There was a potential acquisition they're looking to make in the space early in their life and that not happening, but subsequent to that, essentially, we funded additional purchases of portfolio assets to build out that business. You should expect to see us continue to grow Fifth Season. Again, it's a very actuarial, predictable as long as we have good underwriting practices, non-correlated returns that we think could generate comparable low double-digit rates of returns similar to our other structured investment vehicles.

但這是一種不相關的資產類別，我們認為與經驗豐富的管理團隊合作可以為我們的投資組合帶來非常可觀的回報。他們有 - 這有點複雜，我不確定是否值得詳細介紹。我們正在與他們合作。他們希望在他們生命的早期進行一次潛在的收購，但沒有發生，但在那之後，基本上，我們資助了額外購買投資組合資產以建立該業務。你應該期待看到我們繼續發展第五季。同樣，只要我們有良好的承保實踐，我們認為可以產生與我們其他結構性投資工具類似的低兩位數回報率的非相關回報率，這是一個非常精算的、可預測的。

Okay. I appreciate your comments there. And then I also see that Fifth Season paid a small dividend to ORCC in the fourth quarter. I'm just curious if that dividend is considered recurring. And if you expect the size of the dividend of scale over the next few quarters with the increased investment increments in October and November?

好的。我很感激你在那裡的評論。然後我還看到第五季在第四季度向 ORCC 支付了少量股息。我只是很好奇這種股息是否被認為是經常性的。而隨著10月和11月投資增量的增加，您是否預計未來幾個季度規模紅利的大小？

It was a repayment of the DIP loan. We made a DIP loan on a...

這是對 DIP 貸款的償還。我們在...上提供了 DIP 貸款

It wasn't a dividend. It may be showing up in a way that's confusing. But essentially, I mentioned this potential acquisition that didn't wind up happening and the payment that you're seeing essentially was repaying some financing we had offered in connection with that acquisition. Over time, we will see dividends from Fifth Season, but that is not representative of that. But over time, you will see it, and we'll call that out when it happens.

這不是股息。它可能以一種令人困惑的方式出現。但從本質上講，我提到了這一潛在的收購併沒有最終發生，而你看到的付款基本上是在償還我們提供的與該收購相關的一些融資。隨著時間的推移，我們會看到第五季的紅利，但這並不代表。但隨著時間的推移，你會看到它，我們會在它發生時大聲疾呼。

Okay. Got it. That's helpful. Congratulations on a really nice quarter.

好的。知道了。這很有幫助。祝賀一個非常好的季度。

Our next question is from the line of Mark Hughes with Truist.

我們的下一個問題來自 Mark Hughes with Truist。

You talked about the NAV getting a boost from increased value and the strategic investments, presumably maybe offset by wider spreads. I wonder if you could break out those 2 effects, if possible.

你談到資產淨值從增加的價值和戰略投資中得到提振，大概可以被更廣泛的利差所抵消。我想知道如果可能的話，您是否可以分解這兩種效應。

Sure. So for this quarter, our secured loans basically were flat for the quarter. Our first liens were slightly negative. Our second liens were slightly positive, less than 50 basis points. But essentially, they were flat for the quarter. The second liens was slightly positive because we had 1 particular second lien that is part of a publicly traded capital structure that traded up for the quarter, so it was a very observable increase. So the growth in NAV this quarter was driven by our outearning our dividend and through an increase in value in our equity investments which is not just the structured equity investments that we've been talking about.

當然。因此，對於本季度，我們的擔保貸款基本上與本季度持平。我們的第一留置權略有負面。我們的第二留置權略有積極，不到 50 個基點。但本質上，他們在本季度持平。第二留置權略有積極，因為我們有 1 個特定的第二留置權，它是本季度交易的公開交易資本結構的一部分，因此這是一個非常明顯的增長。因此，本季度資產淨值的增長是由我們賺取股息以及我們股權投資價值的增加所推動的，而不僅僅是我們一直在談論的結構性股權投資。

Our equity investments were up about 3% for the quarter. The biggest driver of that was a company called Windows Entities, which is a business we've owned for a while, has very little leverage on it. It's performed extremely well. Folks that have followed us will know we've taken really nice dividends out of this. The company has performed very well and said there was a markup in that part of the portfolio, Wingspire was up a little bit. Those were the 2 biggest pieces of the increase, $25 million out of the $30 million. So that drove a slight increase in NAV for the quarter.

我們的股權投資在本季度增長了約 3%。其中最大的驅動力是一家名為 Windows Entities 的公司，我們擁有這家公司已有一段時間，但對它的影響力很小。它的表現非常出色。關注我們的人會知道我們從中獲得了非常可觀的收益。該公司表現非常好，並表示投資組合的這一部分有所上漲，Wingspire 上漲了一點。這些是增加的兩個最大部分，3000 萬美元中的 2500 萬美元。因此，這推動了本季度的資產淨值略有增加。

Appreciate that. And then is there a point estimate? You talked about the interest coverage, 2.3x on a trailing basis. I think you said on a port, if you look at the curve, they should be between 1.5x to 2x. Where does it stand now if you use current interest rates on the leverage from interest coverage.

感謝。然後有沒有點估計？你談到利息保障倍數，2.3 倍。我想你在端口上說過，如果你看一下曲線，它們應該在 1.5 倍到 2 倍之間。如果您將當前利率用於利息覆蓋率的槓桿作用，它現在處於什麼位置。

So I think that if you take rates at the end of the year to roll those through, as we said, we'll get to a 1.5x to 2x. If rates stayed where they are like this afternoon and just ran that for 12 months, it's probably more towards the 1.5x part of the range than the 2x part of the range, 1.5x to 1.7x, somewhere in there. Obviously, there's a tremendous number of variables in there, EBITDA and the like. But that gives you a sense. I still -- that's the right range. But I think if you take today's spot rates and just rolled it forward, for 12 months, you'll get something towards the lower half of the range of 1.5x to 2x.

所以我認為，如果你在年底採用利率來推動這些，正如我們所說，我們將達到 1.5 倍至 2 倍。如果利率保持在今天下午的水平，並且持續 12 個月，那麼它可能更接近範圍的 1.5 倍，而不是范圍的 2 倍，即 1.5 到 1.7 倍。顯然，那裡有大量的變量，EBITDA 等等。但這給了你一種感覺。我仍然 - 這是正確的範圍。但我認為，如果你採用今天的即期匯率並將其向前滾動 12 個月，你會得到接近 1.5 倍至 2 倍範圍的下半部分的結果。

(Operator Instructions)

（操作員說明）

The next question is from the line of Mickey Schleien with Ladenburg Thalmann.

下一個問題來自 Mickey Schleien 和 Ladenburg Thalmann 的台詞。

Craig, just one question from me more about capital allocation. Just curious what your thoughts are on the likelihood of continuing to retain some undistributed taxable income in this market environment, which can help bolster the balance sheet versus potentially reducing excise taxes by distributing more of the UTI beyond the supplemental dividends that you have according to the formula.

克雷格，我只問一個關於資本配置的問題。只是好奇您對在這種市場環境中繼續保留一些未分配的應稅收入的可能性有何想法，這可以幫助加強資產負債表，而不是通過分配更多的 UTI 來減少您根據公式。

Yes. Mickey, it's Jonathan. The number right now is still relatively small. We had about $13 million of undistributed NII and maybe about $7 million on the cap gain side. So it's not a significant number, not driving a lot of excise tax. So based on the way our structured dividend policy works, we would anticipate that we're going to continue to spill over a little bit more and we have no plans for doing anything with that spillover at this point.

是的。米奇，是喬納森。現在的數量還是比較少的。我們有大約 1300 萬美元的未分配 NII，在上限收益方面可能有大約 700 萬美元。所以這不是一個很大的數字，不會產生大量的消費稅。因此，根據我們的結構化股息政策的運作方式，我們預計我們將繼續溢出更多一點，目前我們沒有計劃對這種溢出做任何事情。

Next question comes from the line of Kenneth Lee with RBC Capital Markets.

下一個問題來自 RBC Capital Markets 的 Kenneth Lee。

Just one on the expectation for a run rate ROE of about 11%. I think you mentioned assuming if rates aren't changed, does that mean that there could be some upside if rates were to continue increasing. And just wondering what other assumptions are embedded there in terms of leverage and things of that like?

只有一個關於運行率 ROE 約為 11% 的預期。我想你提到假設如果利率不變，這是否意味著如果利率繼續上升可能會有一些上行空間。只是想知道在槓桿和類似事物方面還有哪些其他假設？

Sure. We said 11% or higher, at least 11%. I think we're clearly signaling it could be higher even if rates stay where they are, portfolio continues to perform extremely well. We have the carryover effect from higher rates in the fourth quarter that will roll through in the first quarter and ROE will benefit from that. And we continue to have really excellent credit performance. So we're not -- we're assuming we're staying within our target leverage range. That's extremely important strategically to ORCC to stay within our target range. Investment-grade ratings are strategic imperatives. So we're not assuming anything unusual there. We're just assuming continued strong earnings from the higher rate environment, I do think that we'll continue to grind higher on these equity investments, which are also generate high returns. And we've got really nice visibility that earnings will be -- continue to be very good in this environment, if you think rates are going to stay where they are or they go higher, then I think there's further upside from there.

當然。我們說 11% 或更高，至少 11%。我認為我們清楚地表明，即使利率保持在原位，投資組合繼續表現非常好，它也可能會更高。我們有第四季度較高利率的結轉效應，該效應將在第一季度延續，股本回報率將從中受益。我們繼續擁有非常出色的信用表現。所以我們不是 - 我們假設我們保持在我們的目標槓桿範圍內。這對於 ORCC 保持在我們的目標範圍內具有戰略意義。投資級評級是戰略要務。所以我們沒有假設那裡有什麼不尋常的地方。我們只是假設在高利率環境下持續獲得強勁收益，我確實認為我們將繼續在這些也產生高回報的股票投資上走得更高。而且我們非常清楚地看到收益將會 - 在這種環境下繼續非常好，如果你認為利率將保持在原位或更高，那麼我認為那裡還有進一步的上漲空間。

Again, just to call it out, I hope to make an effort to participate in our Investor Day that we're going to have in May because I think that's the kind of topic I'd like to go through. We think we have a very powerful return story and while it's nice that the stock is up today, it continues to puzzle us why the stock has not traded better given the strong predictable earnings that we're continuing to demonstrate and I think that ROE north of 11% on an ongoing basis, hopefully will address that.

再次聲明，我希望努力參加我們將在 5 月份舉行的投資者日，因為我認為這是我想要討論的話題。我們認為我們有一個非常強大的回報故事，雖然今天股票上漲很好，但它繼續讓我們感到困惑，為什麼我們繼續展示強勁的可預測收益，而且我認為 ROE 北方持續增長 11%，希望能解決這個問題。

Got you. Very helpful there. And just one follow-up, if I may. Wondering if you could just talk about what you're seeing around either [peace] sponsored deal flow? Any other -- what could be key drivers for potential originations over the near term, just given the level of M&A activity?

明白了在那裡很有幫助。如果可以的話，只有一次跟進。想知道您是否可以談談您在 [和平] 贊助交易流程中看到的情況？任何其他 - 考慮到併購活動的水平，短期內潛在起源的主要驅動因素是什麼？

Overall, M&A activity remains quite modest. I think M&A was down about 40% last year. We're not seeing any significant pickup in that activity. But the positive for direct lenders like Owl Rock is while overall activity is lower, it's all going to direct lenders. Direct lenders market share has never been higher. I'd say any transaction of size is primarily being done in the direct lending universe. And we are fortunate here at Owl Rock that we have extremely deep relationships with financial sponsors and see everything that's out there. And are in a fortunate position to be selective on the deals that we do. And the deals we're doing are some -- amongst the best we've seen in our history with great spreads, credit leverage levels, covenants and the like.

總體而言，併購活動仍然相當溫和。我認為併購去年下降了大約 40%。我們沒有看到該活動有任何顯著回升。但對於像 Owl Rock 這樣的直接貸方來說，積極的一面是雖然整體活動較低，但都流向了直接貸方。直接貸方的市場份額從未如此之高。我想說任何規模的交易都主要是在直接貸款領域進行的。我們很幸運，在 Owl Rock，我們與金融贊助商有著非常深厚的關係，並且看到了那裡的一切。並且有幸在我們所做的交易中有所選擇。我們正在做的交易是一些——我們在歷史上看到的最好的交易，具有很大的利差、信貸槓桿水平、契約等。

So there's a lot to like for the new loans that we're doing. I recognize for ORCC, the challenge is not deal flow. The challenge is age repayments. We're sticking to our leverage target. We're having almost no repayments and as a consequence, really matching origination to repayment levels. So we really need repayment levels to pickup for us to take advantage of that. I should say we are able to take advantage of the environment, and we have been doing this in situations where we asked for additional capital or amendments. We have had nice success at repricing as much as 10% of the portfolio in those cases with good performing credits that we like and essentially marking them to the market in the context of amendments and acquisitions.

所以我們正在做的新貸款有很多值得喜歡的地方。我認識到 ORCC 面臨的挑戰不是交易流程。挑戰在於年齡還款。我們堅持我們的槓桿目標。我們幾乎沒有還款，因此，真正將發起與還款水平相匹配。因此，我們確實需要提高還款水平，以便我們利用這一點。我應該說我們能夠利用環境，並且在我們要求額外資本或修正案的情況下我們一直在這樣做。在那些我們喜歡的表現良好的信用案例中，我們在重新定價多達 10% 的投資組合方面取得了巨大的成功，並在修正和收購的背景下將它們標記為市場。

So we are benefiting there. But at some point, if you think that the markets will improve to the point that M&A returns, which I think will happen at some point this year, we should see a significant pickup in repayments at some point, and that will allow us to redeploy capital. So again, I think it's -- I think we've said it probably 3 times today, but all the earnings and the significant earnings performance that we generated in the fourth quarter and that we expect it to continue to generate in the first quarter is without barely any benefit from repayments whatsoever. And so there's another lever down the line. At some point, that will return. But it's a great environment to be a lender if you've got the deal flow, and we're fortunate to have that.

所以我們在那裡受益。但在某個時候，如果你認為市場會改善到併購回報的程度，我認為這將在今年某個時候發生，我們應該會在某個時候看到還款顯著回升，這將使我們能夠重新部署首都。所以，我認為它是——我想我們今天可能已經說過 3 次了，但是我們在第四季度產生的所有收益和顯著的收益表現，我們預計它會在第一季度繼續產生幾乎沒有任何還款的好處。因此，還有另一個槓桿。在某個時候，它會回來。但如果你有交易流程，那麼成為貸方的環境是一個很好的環境，我們很幸運能夠擁有它。

Our next question is from the line of Derek Hewett with Bank of America.

我們的下一個問題來自美國銀行的 Derek Hewett。

Craig, maybe you can take this one. So credit trends, looks like they continue to look good, although PIK income has increased. So I think it's a little under 9.5% of total revenue in 2022 versus, I think, roughly a little above 5% the prior year. So at what level of PIK income would -- it start to become worrisome?

克雷格，也許你可以拿這個。因此，儘管 PIK 收入有所增加，但信貸趨勢看起來仍然不錯。因此，我認為它略低於 2022 年總收入的 9.5%，而我認為，前一年大約略高於 5%。那麼 PIK 的收入達到什麼水平會 - 它開始變得令人擔憂？

The vast majority of our PIK income is not from credit problems, it's from specific deals where we were asked to structure our investment with either a portion or all PIK at the get-go, and we thought it was reasonable to do so for credit specific reasons. It's like 85%, 90% of our PIK income. We have very little PIK income from credit problems. So it's just not -- it's just not -- it's not an indicator of stress in the portfolio. If you're asking me, I think about where we are low double digits, it's about the right level of PIK. So I don't think we expect to take that number higher. As I mentioned before, we're not seeing request for PIK from troubled credit situations, but we are in a very comfortable place there, and there's no -- so you should not look at as a cause of concern of the portfolio. That's not what it's an indicator of.

我們 PIK 收入的絕大部分不是來自信貸問題，而是來自特定交易，在這些交易中，我們被要求在一開始就用部分或全部 PIK 來構建我們的投資，我們認為這樣做對於特定信貸是合理的原因。這大約是我們 PIK 收入的 85%、90%。我們從信用問題中獲得的 PIK 收入很少。所以它不是 - 它不是 - 它不是投資組合壓力的指標。如果你問我，我認為我們處於低兩位數的位置，這與 PIK 的正確水平有關。所以我認為我們不希望這個數字更高。正如我之前提到的，我們沒有看到因信用問題而提出的 PIK 請求，但我們在那里處於一個非常舒適的位置，而且沒有 - 所以你不應該將其視為投資組合關注的原因。這不是它的指標。

At this time, we've reached the end of the question-and-answer session. I'll now turn the call over to Craig Packer for closing remarks.

至此，我們的問答環節已經結束。我現在將電話轉給 Craig Packer 作結束語。

All right. Thank you, everyone. I really appreciate it. Thanks for your time today. We're very accessible. If you have more questions, please reach out to Dana Sclafani, look forward to seeing everyone at our first Investor Day in May and enjoy the day. Thank you.

好的。謝謝大家。對此，我真的非常感激。感謝您今天的時間。我們很方便。如果您有更多問題，請聯繫 Dana Sclafani，期待在 5 月的第一個投資者日見到大家，享受這一天。謝謝。

This will conclude 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。