OFS Capital Corp (OFS) 2025 Q1 法說會逐字稿

Good day, and welcome to the OFS Capital Corporation Q1 2025 Earnings Conference Call. (Operator Instructions) Please note this event is being recorded.

大家好，歡迎參加 OFS Capital Corporation 2025 年第一季財報電話會議。（操作員指示）請注意，此事件正在被記錄。

I would now like to turn the conference over to Mr. Steve Altebrando, Head of Investor Relations. Please go ahead.

現在，我想將會議交給投資者關係主管史蒂夫·阿爾特布蘭多先生。請繼續。

Good morning, everyone, and thank you for joining us. Also on the call today are Bilal Rashid, our Chairman and Chief Executive Officer; and Kyle Spina, the company's Chief Financial Officer and Treasurer.

大家早安，感謝大家的收看。參加今天電話會議的還有我們的董事長兼執行長比拉爾·拉希德 (Bilal Rashid) 和公司財務長兼財務主管凱爾·斯皮納 (Kyle Spina)。

Before we begin, please note that the statements made on this call and webcast may constitute forward-looking statements as defined under applicable securities laws. Such statements reflect various assumptions, expectations and opinions by OFS Capital management concerning anticipated results are not guarantees of future performance and are subject to known and unknown risks, uncertainties and other factors that could cause actual results to differ materially from such statements. The uncertainties and other factors are in some way beyond management's control, including the risk factors described from time to time in our filings with the SEC. Although we believe these assumptions are reasonable, any of those assumptions could prove incorrect, and as a result, the forward-looking statements based on those assumptions also could be incorrect. You should not place undue reliance on these forward-looking statements. OFS Capital undertakes no duty to update any forward-looking statements made herein, and all forward-looking statements speak only as of the date of this call.

在我們開始之前，請注意，本次電話會議和網路廣播中所作的陳述可能構成適用證券法所定義的前瞻性陳述。此類聲明反映了 OFS Capital 管理層對預期結果的各種假設、期望和意見，並不保證未來的業績，並且受已知和未知的風險、不確定性和其他可能導致實際結果與此類聲明存在重大差異的因素的影響。不確定性和其他因素在某種程度上超出了管理層的控制範圍，包括我們向美國證券交易委員會提交的文件中不時描述的風險因素。儘管我們認為這些假設是合理的，但任何假設都可能被證明是錯誤的，因此，基於這些假設的前瞻性陳述也可能是不正確的。您不應過度依賴這些前瞻性陳述。OFS Capital 不承擔更新本文所作任何前瞻性陳述的義務，所有前瞻性陳述僅代表本次電話會議之日的觀點。

With that, I'll turn the call over to Chairman and Chief Executive Officer, Bilal Rashid.

說完這些，我將把電話轉給董事長兼執行長比拉爾·拉希德 (Bilal Rashid)。

Thank you, Steve. As you know, we announced our first quarter earnings yesterday. For the current quarter, our net investment income was $0.26 per share compared to $0.30 per share in the prior quarter. Our net asset value was $11.97 per share compared to $12.85 per share in the prior quarter.

謝謝你，史蒂夫。如您所知，我們昨天公佈了第一季的收益。本季度，我們的淨投資收益為每股 0.26 美元，而上一季為每股 0.30 美元。我們的淨資產價值為每股 11.97 美元，而上一季為每股 12.85 美元。

As mentioned on our last call, net investment income in the prior quarter included nonrecurring dividend and fee income. As a result, we had a decrease in net investment income this quarter.

正如我們上次電話會議中所提到的，上一季的淨投資收入包括非經常性股利和費用收入。因此，本季我們的淨投資收入有所減少。

We remain focused on rotating certain noninterest-earning equity positions into interest-earning assets to improve net investment income in the long term as we continue to explore potential ways to monetize our minority equity investment in Fan Steel Holdings, our largest equity position. As we have noted before, this is a position we invested in more than 11 years ago at a cost of only $200,000. To date, we have received approximately $3.9 million in distributions for approximately 18 times our cost.

我們將繼續致力於將某些不生息的股權投資轉換為生息資產，以提高長期淨投資收益，同時我們將繼續探索將我們對帆鋼控股（我們最大的股權投資）的少數股權投資貨幣化的潛在方式。正如我們之前所指出的，這是我們 11 年前投資的職位，成本僅為 20 萬美元。到目前為止，我們已收到約 390 萬美元的分配，約為我們成本的 18 倍。

The decline in our net asset value per share is primarily due to certain company-specific marks, as well as a more widespread decline in pricing across the broader credit markets. In our view, the overall economic outlook remains uncertain given the potential impact of global tariffs and the related fallout. It is too early to estimate how this rapidly changing global economic environment will affect our portfolio.

我們每股淨資產價值的下降主要是由於某些公司特定的標記，以及更廣泛的信用市場定價的普遍下降。我們認為，鑑於全球關稅的潛在影響及其相關後果，整體經濟前景仍不確定。現在估計快速變化的全球經濟環境將如何影響我們的投資組合還為時過早。

However, we believe that the chances of a slowdown in economic activity have increased which could lead to earnings pressure on our portfolio companies and in return on the earnings of the BDC. That being said, we are encouraged by the general stability of our portfolio with no new nonaccruals this quarter. We believe that we have constructed our loan portfolio to withstand the challenges of an uncertain macroeconomic environment specifically by avoiding highly cyclical industries and maintaining strong diversification.

然而，我們認為經濟活動放緩的可能性已經增加，這可能會給我們的投資組合公司帶來獲利壓力，從而給 BDC 的獲利帶來壓力。話雖如此，我們對投資組合的整體穩定性感到鼓舞，本季沒有出現新的不提項目。我們相信，我們所建構的貸款組合能夠抵禦不確定的宏觀經濟環境的挑戰，特別是透過避開高度週期性的產業並保持強大的多樣化。

We remain focused on investing higher in the capital structure with 100% of our loan portfolio in first lien and second lien senior secured loans. As we navigate this period of uncertainty, we are focused on keeping regular dialogue with our portfolio companies and supporting them with additional capital as they deal with these unprecedented times.

我們仍然專注於在資本結構中進行更高程度的投資，我們的貸款組合 100% 為第一留置權和第二留置權優先擔保貸款。在我們度過這段不確定的時期時，我們專注於與我們的投資組合公司保持定期對話，並在他們應對這些前所未有的時期時為他們提供額外的資金支持。

In our view, our financing continues to provide us operational flexibility. 73% of our outstanding debt is unsecured at the end of the quarter. Our nonrecourse $150 million floating rate facility with BNP Paribas matures in June 2027. And our $25 million Bank of California, floating rate corporate line of credit provides us additional liquidity and flexibility.

我們認為，我們的融資持續為我們提供營運靈活性。截至本季末，我們 73% 的未償債務是無擔保的。我們與法國巴黎銀行簽訂的 1.5 億美元無追索權浮動利率貸款將於 2027 年 6 月到期。我們從加州銀行獲得的 2500 萬美元浮動利率公司信用額度為我們提供了額外的流動性和靈活性。

M&A activity has been fairly quiet so far in 2025, more so than many had expected as we entered the new year. We believe that the macroeconomic uncertainty will continue to dampen the prospects of increased M&A activity. Given this outlook and volatility in the capital markets, we are being cautious in deploying new capital.

2025 年迄今為止，併購活動一直相當平靜，比許多人在進入新年時所預期的還要平靜。我們認為，宏觀經濟的不確定性將繼續抑制併購活動增加的前景。鑑於這種前景和資本市場的波動，我們在部署新資本時持謹慎態度。

Looking ahead, we will rely on the long-standing experience of our adviser, which manages approximately $4.1 billion across the loan and structured credit markets, has expertise in multiple asset classes and industries and has a more than 25-year track record through multiple credit cycles.

展望未來，我們將依靠我們顧問的長期經驗，該顧問管理著貸款和結構性信貸市場約 41 億美元的資金，在多個資產類別和行業擁有專業知識，並在多個信貸週期中擁有超過 25 年的業績記錄。

At this point, I'll turn the call over to Kyle Spina, our Chief Financial Officer to give you more details and color for the quarter.

現在，我將把電話轉給我們的財務長 Kyle Spina，以便向您提供本季度的更多詳細資訊和情況。

Thanks, Bilal, and good morning, everyone. As Bilal mentioned, we posted net investment income of $3.5 million or $0.26 per share for the first quarter which was down $0.04 per share from the fourth quarter. This decrease was primarily due to a drop in nonrecurring dividend and fee income recognized in the prior quarter as well as an anticipated decline in interest income on our loan portfolio attributable to the impact of last year's interest rate cuts.

謝謝，比拉勒，大家早安。正如比拉爾所提到的，我們第一季的淨投資收入為 350 萬美元，即每股 0.26 美元，比第四季度下降了每股 0.04 美元。這一下降主要是由於上一季確認的非經常性股息和費用收入下降，以及由於去年降息的影響，我們的貸款組合利息收入預計下降。

We announced that we are maintaining our quarterly distribution at $0.34 per share for the second quarter of 2025, while we continue to cautiously evaluate this fluid macroeconomic environment. At March 31, our quarterly distribution rate represented a 14.6% annualized yield based on the market price of our common stock. We continue to focus on improving our long-term returns while concentrating on preserving capital.

我們宣布，我們將維持 2025 年第二季每股 0.34 美元的季度分紅，同時我們將繼續謹慎評估這種不穩定的宏觀經濟環境。截至 3 月 31 日，根據我們普通股的市場價格，我們的季度分配率為 14.6% 的年化收益率。我們將繼續致力於提高長期回報，同時專注於保住資本。

Our net asset value per share decreased by approximately 7% or $0.88 this quarter, primarily attributable to net unrealized depreciation on our investment portfolio. The depreciation was recognized across all asset classes but was most pronounced in our loan portfolio with a mix of issuer-specific factors and broader credit market price declines contributing to this net depreciation.

本季我們的每股淨資產價值下降約 7% 或 0.88 美元，主要歸因於我們投資組合的淨未實現折舊。所有資產類別均出現貶值，但在我們的貸款組合中最為明顯，發行人特定因素和更廣泛的信貸市場價格下跌共同導致了這種淨貶值。

As Bilal mentioned, we had no loans placed on nonaccrual during the quarter and our loan portfolio was generally stable based on our internal credit ratings. Our regulatory asset coverage ratio decreased by 4 percentage points and stood at 165% at quarter end. We have continued to proactively explore refinancing and extension options on certain of our debt facilities that have upcoming maturities in the next year. At quarter end, approximately 73% of our outstanding debt was unsecured.

正如比拉爾所提到的，本季我們沒有不提列的貸款，而且根據我們的內部信用評級，我們的貸款組合總體上是穩定的。本季末，監管資產覆蓋率下降4個百分點至165%。我們繼續積極探索明年即將到期的某些債務的再融資和延期選擇。截至季末，我們約 73% 的未償債務是無擔保的。

Now turning to the income statement. Total investment income decreased approximately 12% to $10.3 million this quarter. As I just mentioned, this was primarily driven by the nonrecurring dividend and fee income recognized in the prior quarter as well as lower interest income on our loan portfolio due to the impact of interest rate cuts. Total expenses decreased by approximately 10% during the period to $6.8 million, primarily due to a decrease in the incentive fee.

現在轉向損益表。本季總投資收入下降約 12% 至 1,030 萬美元。正如我剛才提到的，這主要是由於上一季確認的非經常性股息和費用收入，以及由於降息的影響導致我們的貸款組合利息收入減少。期內總支出減少約 10% 至 680 萬美元，主要原因是獎勵費用減少。

Turning to our investments. We believe the vast majority of our loan portfolio remains healthy, while we continue to closely monitor a handful of borrowers performing below our expectations. As mentioned, we had no new nonaccrual loans in the first quarter.

談到我們的投資。我們相信，我們的絕大多數貸款組合仍然保持健康，同時我們繼續密切關注少數表現低於我們預期的借款人。如上所述，第一季我們沒有新的不計息貸款。

With respect to our loan portfolio, we are committed to being senior in the capital structure and selective in our underwriting, with 85% of our loan holdings being in first lien positions. We continue to focus on add-on opportunities for growth with our existing issuers and as of quarter end, had $13.8 million in unfunded commitments to our portfolio companies. The majority of our investments are in loans and 100% of our loan portfolio was senior secured at quarter end.

就我們的貸款組合而言，我們致力於在資本結構上保持優先地位，並在承保方面精挑細選，其中 85% 的貸款持有處於第一留置權地位。我們繼續關注與現有發行人的附加成長機會，截至季度末，我們已向投資組合公司承諾了 1,380 萬美元的未撥款。我們的大部分投資都是貸款，並且季度末我們的貸款組合 100% 都是優先擔保的。

Based on amortized costs as of quarter end, our investment portfolio was comprised of approximately 69% senior secured loans, 25% structured finance securities and 6% equity securities. At the end of the quarter, we had investments in 63 unique issuers totaling $403.1 million of fair value.

根據截至季末的攤銷成本，我們的投資組合由約 69% 的優先擔保貸款、25% 的結構性融資證券和 6% 的股權證券組成。截至本季末，我們對 63 家獨立發行人的投資總額為 4.031 億美元。

On the interest-bearing portion of the portfolio, the weighted average performing investment income yield declined modestly to 13.4% which is down about 0.4% quarter-over-quarter. The decrease in yield was primarily due to the impact of last year's interest rate cuts on our contractual interest income. This metric includes all interest, prepayment fee and amortization of deferred loan fee income but excludes syndication fee income, if applicable.

在投資組合的計息部分，加權平均投資收益率小幅下降至 13.4%，季減約 0.4%。收益率下降主要是由於去年降息對我們合約利息收入的影響。此指標包括所有利息、預付費用和遞延貸款費用收入的攤銷，但不包括銀團費用收入（如果適用）。

With that, I'll turn the call back over to Bilal for concluding remarks.

說完這些，我將把電話轉回給比拉勒，請他做最後發言。

Thank you, Kyle. In closing, we recognize that the current macroeconomic uncertainty may have a negative impact on the economy. However, we believe our portfolio is generally stable and is defensively positioned to withstand the pressures of this challenging environment. Our portfolio remains diversified across multiple industries, and we continue to be committed to investing higher in the capital structure.

謝謝你，凱爾。最後，我們認識到當前宏觀經濟的不確定性可能會對經濟產生負面影響。然而，我們相信我們的投資組合總體穩定，並且具有防禦性，可以承受這種充滿挑戰的環境的壓力。我們的投資組合仍然多元化，涉及多個行業，我們繼續致力於在資本結構中進行更高的投資。

We are focused on increasing our net investment income over the long term, specifically by exploring the sale of certain noninterest-earning equity positions and redeploying the proceeds into interest-earning assets. We continue to focus on capital preservation, which is especially critical during these uncertain economic times. We believe our long-standing experience and investment discipline have served us well over the past 14 years.

我們專注於長期增加淨投資收益，具體方法是探索出售某些無息股權並將收益重新部署到生息資產中。我們繼續關注資本保全，這在經濟不確定的時期尤其重要。我們相信，我們長期累積的經驗和投資紀律在過去 14 年為我們帶來了良好的效益。

Since the beginning of 2011, the BDC has invested more than $2 billion with a cumulative net realized loss of just 3.4% while generating attractive risk-adjusted returns on our portfolio. We believe our business is especially equipped to navigate this market successfully due to the size, experience and reputation of our advisers. With a $4.1 billion corporate credit platform, affiliated with a $30 billion asset management group, our adviser has broad expertise, including long-standing banking and capital markets relationships. Our corporate credit platform has gone through multiple credit cycles over the last 25-plus years. Our adviser and affiliates are also strongly aligned with shareholders as they maintain an approximately 23% ownership in the company.

自 2011 年初以來，BDC 已投資超過 20 億美元，累計淨實現虧損僅 3.4%，同時為我們的投資組合產生了頗具吸引力的風險調整回報。我們相信，憑藉我們顧問的規模、經驗和聲譽，我們的業務特別有能力成功駕馭這個市場。我們的顧問擁有 41 億美元的企業信貸平台，隸屬於 300 億美元的資產管理集團，擁有廣泛的專業知識，包括長期的銀行和資本市場關係。過去25多年來，我們的企業信貸平台經歷了多個信貸週期。我們的顧問和附屬公司也與股東保持著密切的聯繫，因為他們持有公司約 23% 的所有權。

With that, operator, please open up the call for questions.

接線員，請打開電話詢問。

(Operator Instructions) As there are no questions, this concludes our conference. Thank you for attending today's presentation. You may now disconnect.

（操作員指示）由於沒有問題，我們的會議到此結束。感謝您參加今天的演講。您現在可以斷開連線。