Morgan Stanley Direct Lending Fund Announces June 30, 2024 Financial Results and Declares Third Quarter 2024 Dividend of $0.50 per Share
“In the second quarter of 2024, our first full quarter operating as a public company, MSDL generated strong operating results,” said
QUARTERLY HIGHLIGHTS
-
Net investment income of
$56.1 million , or$0.63 per share; -
Net asset value of
$20.83 per share, as compared to$20.67 as ofMarch 31, 2024 ; -
Debt-to-equity was 0.90x as of
June 30, 2024 , as compared to 0.81x as ofMarch 31, 2024 ; -
New investment commitments of
$673.9 million , fundings of$499.7 million and sales and repayments of$289.3 million , resulting in net funded deployment of$210.4 million ; and -
The Company’s Board of Directors (the “Board”) declared a regular dividend of
$0.50 per share, paid onJuly 25, 2024 to stockholders of record as ofJune 28, 2024 .
SELECTED FINANCIAL HIGHLIGHTS
For the Quarter Ended |
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Net investment income per share |
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Net realized and unrealized gains (losses) per share1 |
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( |
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Earnings per share |
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Regular dividend per share |
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As of |
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($ in thousands, except per share information) |
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Investments, at fair value |
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Total debt outstanding, at principal |
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Net assets |
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Net asset value per share |
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Debt to equity |
0.90x |
0.81x |
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Net debt to equity |
0.85x |
0.77x |
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1Amount shown may not correspond for the period as it includes the effect of the timing of the distribution and the issuance of common stock. |
RESULTS OF OPERATIONS
Total investment income for the second quarter ended
Total expenses for the quarter ended
Net investment income for the quarter ended
For the quarter ended
PORTFOLIO AND INVESTMENT ACTIVITY
As of
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($ in thousands) |
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Cost |
|
Fair Value |
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% of Total Investments at Fair Value |
|
Cost |
|
Fair Value |
|
% of Total Investments at Fair Value |
First Lien Debt |
|
|
|
|
|
95.3% |
|
|
|
|
|
94.6% |
Second Lien Debt |
|
122,416 |
|
103,144 |
|
2.9 |
|
136,708 |
|
118,107 |
|
3.6 |
Other Debt Investments |
|
9,289 |
|
8,467 |
|
0.2 |
|
3,430 |
|
2,163 |
|
0.1 |
Equity |
|
53,735 |
|
56,932 |
|
1.6 |
|
52,500 |
|
57,531 |
|
1.7 |
Total |
|
|
|
|
|
100.0% |
|
|
|
|
|
100.0% |
Investment activity for the three months ended
Investment Activity: |
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New investment commitments, at par |
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Investment fundings |
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Number of new Investment commitments in portfolio companies |
22 |
9 |
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Number of portfolio companies exited or fully repaid |
8 |
3 |
Total weighted average yield of investments in debt securities at amortized cost and fair value was 11.6% and 11.7%, respectively, as of
CAPITAL AND LIQUIDITY
As of
OTHER DEVELOPMENTS
-
On
August 6, 2024 , the Board declared a distribution of$0.50 per share, which is payable onOctober 25, 2024 to shareholders of record as ofSeptember 30, 2024 . -
The Board previously declared a
$0.10 per share special dividend to shareholders of record as ofAugust 5, 2024 . - In July, Moody’s affirmed MSDL’s Baa3 (stable) rating.
CONFERENCE CALL INFORMATION
- Audio Webcast
- Conference Call
- Domestic: 323-994-2093
- International: 888-394-8218
- Passcode: 5963189
To avoid potential delays, please join at least 10 minutes prior to the start of the earnings call. An archived replay will also be available on the MSDL Investor Relations website.
About
Forward-Looking Statements
Statements included herein or on the webcast/conference call may constitute “forward-looking statements,” which relate to future events or MSDL’s future performance or financial condition. These statements are not guarantees of future performance, condition or results and involve a number of risks and uncertainties. Actual results and conditions may differ materially from those in the forward-looking statements as a result of a number of factors, including those described from time to time in MSDL’s filings with the
Consolidated Statements of Assets and Liabilities (In thousands, except share and per share amounts) |
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As of |
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(Unaudited) |
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(Audited) |
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Assets |
|
|
|
|
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Non-controlled/non-affiliated investments, at fair value (amortized cost of |
|
$ |
3,514,286 |
|
$ |
3,193,561 |
Cash and cash equivalents (restricted cash of |
|
|
94,966 |
|
|
69,705 |
Deferred financing costs |
|
|
17,000 |
|
|
14,317 |
Interest and dividend receivable from non-controlled/non-affiliated investments |
|
|
27,594 |
|
|
28,884 |
Subscription receivable |
|
|
— |
|
|
41 |
Receivable for investments sold/repaid |
|
|
136 |
|
|
173 |
Prepaid expenses and other assets |
|
|
1,917 |
|
|
53 |
Total assets |
|
|
3,655,899 |
|
|
3,306,734 |
|
|
|
|
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Liabilities |
|
|
|
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Debt (net of unamortized debt issuance costs of |
|
|
1,664,423 |
|
|
1,496,032 |
Payable for investment purchased |
|
|
31,469 |
|
|
8 |
Payable to affiliates (Note 3) |
|
|
1,508 |
|
|
2,870 |
Dividends payable |
|
|
44,704 |
|
|
49,968 |
Management fees payable |
|
|
6,479 |
|
|
2,012 |
Income based incentive fees payable |
|
|
9,903 |
|
|
11,766 |
Interest payable |
|
|
20,664 |
|
|
18,823 |
Accrued expenses and other liabilities |
|
|
14,788 |
|
|
4,104 |
Total liabilities |
|
|
1,793,938 |
|
|
1,585,583 |
|
|
|
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Commitments and Contingencies (Note 7) |
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Net assets |
|
|
|
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Preferred stock, |
|
|
— |
|
|
— |
Common stock, par value |
|
|
89 |
|
|
83 |
Paid-in capital in excess of par value |
|
|
1,831,835 |
|
|
1,712,609 |
Total distributable earnings (loss) |
|
|
30,037 |
|
|
8,459 |
Total net assets |
|
$ |
1,861,961 |
|
$ |
1,721,151 |
Total liabilities and net assets |
|
$ |
3,655,899 |
|
$ |
3,306,734 |
Net asset value per share |
|
$ |
20.83 |
|
$ |
20.67 |
Consolidated Statements of Operations (unaudited) (In thousands, except share amounts) |
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For the Three Months Ended |
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For the Six Months Ended |
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Investment Income: |
|
|
|
|
|
|
|
|
||||||||
From non-controlled/non-affiliated investments: |
|
|
|
|
|
|
|
|
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Interest income |
|
$ |
99,072 |
|
|
$ |
86,573 |
|
|
$ |
193,703 |
|
|
$ |
168,290 |
|
Payment-in-kind |
|
|
2,850 |
|
|
|
622 |
|
|
|
5,494 |
|
|
|
1,063 |
|
Dividend income |
|
|
646 |
|
|
|
504 |
|
|
|
1,211 |
|
|
|
1,000 |
|
Other income |
|
|
1,620 |
|
|
|
1,195 |
|
|
|
2,881 |
|
|
|
2,180 |
|
Total investment income |
|
|
104,188 |
|
|
|
88,894 |
|
|
|
203,289 |
|
|
|
172,533 |
|
|
|
|
|
|
|
|
|
|
||||||||
Expenses: |
|
|
|
|
|
|
|
|
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Interest and other financing expenses |
|
|
29,302 |
|
|
|
27,907 |
|
|
|
56,562 |
|
|
|
54,574 |
|
Management fees |
|
|
8,639 |
|
|
|
7,446 |
|
|
|
16,869 |
|
|
|
14,750 |
|
Income based incentive fees |
|
|
11,554 |
|
|
|
10,138 |
|
|
|
22,890 |
|
|
|
19,519 |
|
Professional fees |
|
|
1,687 |
|
|
|
847 |
|
|
|
2,904 |
|
|
|
2,088 |
|
Directors’ fees |
|
|
128 |
|
|
|
88 |
|
|
|
274 |
|
|
|
168 |
|
Administrative service fees |
|
|
17 |
|
|
|
60 |
|
|
|
42 |
|
|
|
114 |
|
General and other expenses |
|
|
51 |
|
|
|
197 |
|
|
|
159 |
|
|
|
365 |
|
Total expenses |
|
|
51,378 |
|
|
|
46,683 |
|
|
|
99,700 |
|
|
|
91,578 |
|
Management fees waiver (Note 3) |
|
|
(2,160 |
) |
|
|
(5,584 |
) |
|
|
(5,257 |
) |
|
|
(11,062 |
) |
Incentive fees waiver (Note 3) |
|
|
(1,651 |
) |
|
|
— |
|
|
|
(2,862 |
) |
|
|
— |
|
Net expenses |
|
|
47,567 |
|
|
|
41,099 |
|
|
|
91,581 |
|
|
|
80,516 |
|
Net investment income (loss) before taxes |
|
|
56,621 |
|
|
|
47,795 |
|
|
|
111,708 |
|
|
|
92,017 |
|
Excise tax expense |
|
|
500 |
|
|
|
— |
|
|
|
936 |
|
|
|
— |
|
Net investment income (loss) after taxes |
|
|
56,121 |
|
|
|
47,795 |
|
|
|
110,772 |
|
|
|
92,017 |
|
|
|
|
|
|
|
|
|
|
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Net realized and unrealized gain (loss): |
|
|
|
|
|
|
|
|
||||||||
Net realized gain (loss) on non-controlled/non-affiliated investments |
|
|
108 |
|
|
|
— |
|
|
|
(5,517 |
) |
|
|
122 |
|
Net change in unrealized appreciation (depreciation) on non-controlled/non-affiliated investments |
|
|
2,816 |
|
|
|
8,647 |
|
|
|
5,474 |
|
|
|
8,080 |
|
Net realized and unrealized gain (loss) |
|
|
2,924 |
|
|
|
8,647 |
|
|
|
(43 |
) |
|
|
8,202 |
|
Net increase (decrease) in net assets resulting from operations |
|
$ |
59,045 |
|
|
$ |
56,442 |
|
|
$ |
110,729 |
|
|
$ |
100,219 |
|
|
|
|
|
|
|
|
|
|
||||||||
Net investment income (loss) per share (basic and diluted) |
|
$ |
0.63 |
|
|
$ |
0.67 |
|
|
$ |
1.25 |
|
|
$ |
1.29 |
|
Earnings per share (basic and diluted) |
|
$ |
0.66 |
|
|
$ |
0.79 |
|
|
$ |
1.25 |
|
|
$ |
1.41 |
|
Weighted average shares outstanding |
|
|
89,271,839 |
|
|
|
71,337,323 |
|
|
|
88,315,183 |
|
|
|
71,101,563 |
|
View source version on businesswire.com: https://www.businesswire.com/news/home/20240808695411/en/
Investors
msdl@morganstanley.com
Media
212-762-0514
alyson.barnes@morganstanley.com
Source: