Core Viewpoint - Nuveen Churchill Direct Lending (NCDL) is a notable player in the Business Development Company (BDC) sector, although less recognized compared to Blackstone Secured Lending Fund (BXSL) and Morgan Stanley Direct Lending Fund (MSDL) [1] Company Insights - NCDL is positioned as a viable investment option within the BDC landscape, emphasizing its potential for steady income through dividend investing [1] - The article highlights the author's extensive experience in M&A and business valuation, indicating a strong foundation for evaluating companies like NCDL [1] Investment Philosophy - The focus on dividend investing is presented as an accessible path to financial freedom, with the author sharing insights to help others navigate this investment strategy [1] - The article aims to demystify the process of dividend investing, making it more approachable for individuals seeking to build long-term wealth [1]

Core Insights - Nuveen Churchill Direct Lending Corp (NYSE: NCDL) reported a regular dividend yield of 10.45% and has a net investment yield [1] Group 1 - The article discusses the Q4 results for NCDL and maintains a Buy rating for the stock [1] - The company is highlighted for its performance in the Business Development Company (BDC) sector [1] - The article suggests exploring various investment tools for navigating BDC, Closed-End Funds (CEF), Open-End Funds (OEF), preferred stocks, and baby bonds [1]

Group 1 - Nuveen Churchill Direct Lending Corp. (NYSE: NCDL) is one of six Business Development Companies (BDCs) currently held in the portfolio alongside other high-quality names such as Morgan Stanley Direct Lending Fund (MSDL) [1] - Roberts Berzins has over a decade of experience in financial management, assisting top-tier corporates in shaping financial strategies and executing large-scale financings [1] - Berzins has contributed to institutionalizing the REIT framework in Latvia to enhance the liquidity of pan-Baltic capital markets [1] Group 2 - Berzins has been involved in policy-level work, including the development of national State-Owned Enterprise (SOE) financing guidelines and frameworks for channeling private capital into affordable housing [1] - Berzins holds a CFA Charter and an ESG investing certificate, and has interned at the Chicago Board of Trade while residing in Latvia [1] - He is actively engaged in thought-leadership activities to support the development of pan-Baltic capital markets [1]

Financial Data and Key Metrics Changes - For the full year 2024, the company generated a return on equity (ROE) of 12.4% on net investment income and paid total distributions of $2.10 per share, resulting in an attractive yield of 11.6% based on year-end net asset value [8][9] - Net investment income for Q4 2024 was $0.56 per share, which fully covered the regular distribution and previously declared special dividend totaling $0.55 per share [10][29] - The net asset value per share increased to $18.18 at December 31, 2024, up from $18.15 at the end of Q3 2024 [12][33] Business Line Data and Key Metrics Changes - Investment activity during Q4 was primarily focused on senior secured first lien loans, with new originations totaling $163 million for the quarter [11][18] - The investment portfolio had a fair value of $2.08 billion at the end of Q4, compared to $2.05 billion at the end of Q3 [34] - First lien debt represented over 90% of the fair value of the overall portfolio, maintaining a steady focus on traditional middle market senior loans [19][41] Market Data and Key Metrics Changes - The company noted that credit quality remains strong, with only 1 portfolio company on nonaccrual status, representing 0.1% of the total portfolio at fair value [9][24] - The direct lending market accounted for approximately 90% of middle market new leveraged buyout (LBO) volume, indicating a strong position in the core middle market [14][70] Company Strategy and Development Direction - The company aims to continue focusing on the core middle market direct lending space, leveraging long-standing relationships and extensive commitments to identify attractive investment opportunities [12][26] - The company plans to optimize its capital structure and balance sheet, having issued $300 million of unsecured notes in January 2025 [9][47] - The strategy includes a supplemental dividend program to distribute excess earnings while retaining capital to grow net asset value [31][58] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's positioning as a leader in the core middle market direct lending space, despite competitive dynamics in the private credit market [12][13] - The economic environment is viewed as healthy and resilient, with expectations of increased M&A activity in 2025 [15][26] - Management is actively monitoring potential impacts from policy changes but does not expect a material impact on performance due to the diversification of the portfolio [16][26] Other Important Information - The company had a record year of investment activity in 2024, investing over $13 billion across approximately 400 transactions [18][34] - The company’s share repurchase program has utilized approximately $57 million, with $42 million remaining [51][52] - The final lockup release for pre-IPO shareholders occurred on January 24, 2025, increasing the number of shares available for trading [52] Q&A Session Summary Question: Details on supplemental dividends after the last $0.10 dividend - Management indicated that approximately 50% of excess earnings would form the basis of the supplemental dividend, focusing on distributing most earnings while retaining some capital for reinvestment [58] Question: Expected repricing impact on overall yield - Management estimated that around 70-75% of the portfolio has already repriced, with limited further repricing expected [62][64] Question: Anticipated changes in PIK income ratio for 2025 - Management expects PIK income to remain in the low single-digit percentage range, primarily driven by junior capital positions [66][69] Question: Sustainability of direct lenders' dominance in the middle market - Management believes direct lenders will continue to dominate the core middle market due to their ability to deliver full financing commitments quickly and maintain deep relationships [72][74]

分组1 - Nuveen Churchill Direct Lending Corp. reported quarterly earnings of $0.56 per share, missing the Zacks Consensus Estimate of $0.58 per share, and down from $0.66 per share a year ago, representing an earnings surprise of -3.45% [1] - The company posted revenues of $57.08 million for the quarter ended December 2024, missing the Zacks Consensus Estimate by 7.64%, compared to year-ago revenues of $48.95 million [2] - The stock has gained approximately 5.8% since the beginning of the year, outperforming the S&P 500's gain of 1.3% [3] 分组2 - The current consensus EPS estimate for the coming quarter is $0.59 on revenues of $63.2 million, and for the current fiscal year, it is $2.04 on revenues of $258.5 million [7] - The Zacks Industry Rank for Financial - SBIC & Commercial Industry is currently in the top 22% of over 250 Zacks industries, indicating a favorable outlook for the industry [8]

[Full Year and Fourth Quarter 2024 Results Announcement](index=1&type=section&id=Nuveen%20Churchill%20Direct%20Lending%20Corp.%20Announces%20Full%20Year%20and%20Fourth%20Quarter%202024%20Results) NCDL reported strong Q4 2024 results with increased NAV and net investment income, alongside record originations and a strategic capital structure optimization for 2025 [Q4 2024 Financial Highlights and Management Commentary](index=1&type=section&id=Financial%20Highlights%20for%20the%20Quarter%20Ended%20December%2031%2C%202024) Nuveen Churchill Direct Lending Corp. (NCDL) reported strong Q4 2024 results, with net investment income of $0.56 per share and a net asset value (NAV) increase to $18.18 per share Financial Highlights for Q4 2024 | Metric | Value | | :--- | :--- | | Net Investment Income per Share | $0.56 | | Net Realized & Unrealized Loss per Share | ($0.02) | | Net Increase in Net Assets per Share | $0.54 | | Net Asset Value (NAV) per Share | $18.18 | - Management noted 2024 was an active year for originations, with over **$950 million** in new investments, a YoY increase of over **40%**[3](index=3&type=chunk) - For the full year 2024, the company delivered a return on equity exceeding **12%**, with distributions fully covered by net investment income[3](index=3&type=chunk) - The company strengthened its balance sheet by issuing **$300 million** of unsecured notes in January 2025, ensuring ample liquidity and no near-term debt maturities[3](index=3&type=chunk) [Distribution Declaration](index=1&type=section&id=Distribution%20Declaration) The Board of Directors has declared a regular quarterly distribution of $0.45 per share for the first quarter of 2025, in addition to a final special distribution of $0.10 per share - A first quarter 2025 regular distribution of **$0.45 per share** was declared, payable on April 28, 2025, to shareholders of record as of March 31, 2025[4](index=4&type=chunk) - The final of four special distributions of **$0.10 per share** will be paid on April 28, 2025[4](index=4&type=chunk) [Portfolio Analysis](index=1&type=section&id=PORTFOLIO%20ANALYSIS) The investment portfolio expanded to $2.08 billion, maintaining a defensive first-lien debt focus, while significantly improving asset quality with reduced non-accrual investments [Portfolio Composition and Quality](index=1&type=section&id=PORTFOLIO%20COMPOSITION) As of December 31, 2024, the investment portfolio's fair value grew to $2.08 billion across 210 companies, maintaining a defensive position with 90.6% in first-lien debt Portfolio Metrics | Metric | Dec 31, 2024 | Sep 30, 2024 | | :--- | :--- | :--- | | Portfolio Fair Value | $2.08 billion | $2.05 billion | | Portfolio Companies | 210 | 202 | | Industries | 27 | 26 | Investment Type Composition | Investment Type | % of Portfolio (Fair Value) - Dec 31, 2024 | % of Portfolio (Fair Value) - Sep 30, 2024 | | :--- | :--- | :--- | | First-Lien Debt | 90.6% | 90.1% | | Subordinated Debt | 7.7% | 8.3% | | Equity Investments | 1.8% | 1.7% | - Portfolio quality improved, with non-accrual investments decreasing from three companies (**1.4% at cost**) in Q3 to one company (**0.4% at cost**) in Q4 2024. No new portfolio companies were placed on non-accrual status during the quarter[8](index=8&type=chunk) [Portfolio and Investment Activity](index=2&type=section&id=PORTFOLIO%20AND%20INVESTMENT%20ACTIVITY) For the full year 2024, NCDL significantly increased its investment pace, funding $863.6 million, a substantial rise from $589.0 million in 2023 Full Year Investment Activity | Full Year Activity | 2024 | 2023 | | :--- | :--- | :--- | | Funded Investments | $863.6 million | $589.0 million | | Proceeds from Repayments/Sales | $430.0 million | $146.4 million | Quarterly Investment Activity | Quarterly Activity | Q4 2024 | Q3 2024 | | :--- | :--- | :--- | | Funded Investments | $151.1 million | $203.2 million | | Proceeds from Repayments/Sales | $119.5 million | $155.6 million | [Results of Operations](index=2&type=section&id=RESULTS%20OF%20OPERATIONS%20FOR%20THE%20FULL%20YEAR%20AND%20QUARTER%20ENDED%20DECEMBER%2031%2C%202024) Investment income increased due to portfolio growth, while expenses rose from higher interest and management fees, partially offset by net unrealized gains [Investment Income](index=2&type=section&id=Investment%20Income) Full-year 2024 investment income grew to $224.0 million from $161.8 million in 2023, driven by a larger investment portfolio, despite a decrease in weighted average yield - Full-year 2024 investment income increased to **$224.0 million** from **$161.8 million** in 2023, primarily due to increased deployed capital[11](index=11&type=chunk) - The weighted average yield of debt investments decreased to **10.33%** as of Dec 31, 2024, from **11.72%** a year prior, due to spread tightening and a decline in SOFR[11](index=11&type=chunk) - Q4 2024 investment income was **$57.1 million**, up from **$48.9 million** in Q4 2023[12](index=12&type=chunk) [Net Expenses](index=2&type=section&id=Net%20Expenses) Net expenses for 2024 rose to $101.1 million from $77.9 million in 2023, mainly due to higher interest expenses and management fees, with incentive fees waived through Q1 2025 - Full-year 2024 net expenses increased to **$101.1 million** from **$77.9 million** in 2023, driven by higher interest, debt financing expenses, and management fees[13](index=13&type=chunk) - The Adviser is waiving incentive fees on income and capital gains for the five quarters from March 31, 2024, through March 31, 2025[13](index=13&type=chunk) [Net Realized and Unrealized Gains/Losses](index=3&type=section&id=Net%20Realized%20Gain%20%28Loss%29%20and%20Net%20Change%20in%20Unrealized%20Gain%20%28Loss%29%20on%20Investments) For the full year 2024, the company experienced a net realized loss of $(13.2) million, largely offset by a net unrealized gain of $7.3 million from market spread tightening Full Year Performance | Full Year Performance | 2024 | 2023 | | :--- | :--- | :--- | | Net Realized Loss | $(13.2) million | $(8.0) million | | Net Change in Unrealized Gain | $7.3 million | $0.7 million | Fourth Quarter Performance | Fourth Quarter Performance | Q4 2024 | Q4 2023 | | :--- | :--- | :--- | | Net Realized Loss | $(11.7) million | $(1.5) million | | Net Change in Unrealized Gain | $11.3 million | $4.5 million | [Financial Condition and Liquidity](index=3&type=section&id=Financial%20Condition%2C%20Liquidity%20and%20Capital%20Resources) NCDL maintains robust liquidity with $43.3 million cash and $206.3 million available credit, supporting a debt-to-equity ratio of 1.15x [Liquidity and Capital Resources](index=3&type=section&id=Liquidity%20and%20Capital) As of December 31, 2024, NCDL maintained a solid liquidity position with $43.3 million in cash and approximately $206.3 million available for borrowing under its credit facilities Liquidity Metrics (as of Dec 31, 2024) | Liquidity Metric (as of Dec 31, 2024) | Value | | :--- | :--- | | Cash and Cash Equivalents | $43.3 million | | Total Debt Outstanding | $1.1 billion | | Available Borrowing Capacity | $206.3 million | | Debt to Equity Ratio | 1.15x | - The debt-to-equity ratio increased to **1.15x** at year-end, compared to **1.11x** at the end of Q3 2024[17](index=17&type=chunk) [Consolidated Financial Statements](index=6&type=section&id=CONSOLIDATED%20FINANCIAL%20STATEMENTS) Total assets and net assets grew significantly, reflecting increased investment income and a substantial rise in new gross commitments for the year [Consolidated Statements of Assets and Liabilities](index=6&type=section&id=CONSOLIDATED%20STATEMENTS%20OF%20ASSETS%20AND%20LIABILITIES) As of December 31, 2024, total assets increased to $2.14 billion from $1.73 billion a year prior, driven by growth in the investment portfolio, resulting in a NAV per share of $18.18 Balance Sheet (in thousands) | Balance Sheet (in thousands) | Dec 31, 2024 | Dec 31, 2023 | | :--- | :--- | :--- | | Total Investments, at fair value | $2,081,379 | $1,641,686 | | Total Assets | $2,143,725 | $1,730,864 | | Total Liabilities | $1,173,405 | $982,979 | | Total Net Assets | $970,320 | $747,885 | | Net Asset Value per Share | $18.18 | $18.13 | [Consolidated Statements of Operations](index=7&type=section&id=CONSOLIDATED%20STATEMENTS%20OF%20OPERATIONS) For the year ended December 31, 2024, NCDL reported total investment income of $224.0 million and net investment income of $122.4 million, resulting in a net increase in net assets from operations of $116.3 million Income Statement (Year Ended Dec 31, in thousands) | Income Statement (Year Ended Dec 31, in thousands) | 2024 | 2023 | | :--- | :--- | :--- | | Total Investment Income | $224,040 | $161,756 | | Net Expenses | $101,101 | $77,744 | | Net Investment Income | $122,388 | $84,006 | | Total Net Realized & Unrealized Loss | $(6,065) | $(8,068) | | Net Increase in Net Assets from Operations | $116,323 | $75,938 | | Net Investment Income per Share | $2.26 | $2.52 | | Net Increase in Net Assets per Share | $2.15 | $2.27 | [Detailed Portfolio and Investment Activity](index=9&type=section&id=DETAILED%20PORTFOLIO%20AND%20INVESTMENT%20ACTIVITY) In 2024, NCDL's new gross commitments surged to $955.3 million, with first-lien debt comprising the vast majority, and the number of portfolio companies growing to 210 Full Year Investment Activity | Full Year Investment Activity | 2024 | 2023 | | :--- | :--- | :--- | | New Gross Commitments at Par | $955.3 million | $670.6 million | | Net Funded Investment Activity | $433.6 million | $442.6 million | | Number of New Portfolio Companies | 68 | 45 | | Portfolio Companies, End of Period | 210 | 179 | | W.A. Interest Rate on New Debt | 10.11% | 11.50% | Quarterly Investment Activity | Quarterly Investment Activity | Q4 2024 | Q3 2024 | | :--- | :--- | :--- | | New Gross Commitments at Par | $162.7 million | $225.6 million | | Net Funded Investment Activity | $31.6 million | $47.5 million | | Number of New Portfolio Companies | 16 | 18 | | W.A. Interest Rate on New Debt | 8.96% | 9.63% |

Financing and Capital Structure - The company has raised approximately $906.4 million from private offerings of its common stock since March 2020[85]. - The company currently has two special purpose vehicle asset credit facilities and a revolving credit facility, with plans to potentially enter additional credit facilities in the future[77]. - The company expects interest expense to increase as leverage is increased over time, subject to regulatory limits[76]. - The company may not issue common stock below NAV per share without shareholder approval, which was granted until December 15, 2024[88]. - The company must maintain at least 70% of its total assets in qualifying assets as defined by the 1940 Act[91]. - The company must maintain an asset coverage ratio of at least 150% for issuing senior securities, which includes total assets less total liabilities divided by total indebtedness represented by senior securities plus preferred stock[96]. - The company is permitted to co-invest with affiliates under certain conditions, which enhances investment opportunities and diversification[99]. - The SEC granted the company a permanent amendment to allow follow-on investments in existing portfolio companies with certain private fund affiliates[100]. Regulatory Compliance - The company is regulated as a Business Development Company (BDC) under the 1940 Act, which imposes certain restrictions on transactions and requires a majority of independent directors[86]. - The company is subject to restrictions on the issuance of warrants, options, or rights under the 1940 Act, with a limit that the amount of voting securities resulting from such exercises cannot exceed 25% of the total outstanding shares[95]. - The company has adopted a code of ethics that restricts personal securities transactions by its officers and employees, ensuring compliance with federal securities laws[97]. - The company is required to provide annual reports containing audited financial statements and comply with periodic reporting under the Exchange Act[115]. - To qualify as a Regulated Investment Company (RIC), the company must distribute at least 90% of its investment company taxable income to shareholders[118]. - The company will be subject to a 4% nondeductible U.S. federal excise tax on certain undistributed income unless it meets specific distribution requirements[120]. - The company must derive at least 90% of gross income from specific sources to maintain RIC status[126]. - The company must diversify its holdings to meet regulatory requirements, limiting investments in any single issuer to no more than 25% of total assets[126]. Investment Strategy and Risk Management - The company assesses material environmental, social, and governance (ESG) factors as part of its investment process to create and protect value[79]. - The company utilizes a proprietary ESG ratings template to evaluate potential investments and monitor portfolio companies post-investment[81]. - The company operates in a competitive market for credit investments, facing competition from larger firms with greater resources[83]. - The company does not have any employees and relies on the expertise of senior investment professionals from its sub-adviser, Churchill[84]. - The company may need to sell assets or raise additional capital to satisfy the Annual Distribution Requirement, which could be disadvantageous[122]. - The company may experience valuation risk due to investments in illiquid debt and equity securities of private companies[532]. - The company is subject to interest rate risk, with potential adverse effects on net investment income due to fluctuations in interest rates[533]. - The Federal Reserve's recent rate cuts may impact the company's cost of funds and net investment income[534]. - A hypothetical increase of 300 basis points in interest rates could result in a net income increase of $25,474,000[538]. - As of December 31, 2024, approximately 5.32% of the company's debt investments bear interest at a fixed rate, while 94.68% bear interest at a floating rate[535]. - The company has a significant portion of its floating rate debt investments (99.09%) subject to interest rate floors[535]. Taxation and Financial Implications - If the company fails to qualify as a RIC, it would be subject to U.S. federal income tax at corporate rates on all taxable income[128].

Core Insights - The article discusses the Q3 results for Nuveen Churchill Direct Lending Corp (NYSE: NCDL), which recently went public alongside other private BDCs earlier in the year [1]. Group 1: Company Overview - Nuveen Churchill Direct Lending Corp is a Business Development Company (BDC) that focuses on generating income through various security types, including CEFs, ETFs, mutual funds, and individual preferred stocks [1]. Group 2: Analyst Background - ADS Analytics, the team behind the analysis, consists of experienced analysts from leading global investment banks, specializing in research and trading [1].

Financial Data and Key Metrics Changes - The company reported net investment income of $0.58 per share for Q3 2024, fully covering the regular quarterly distribution of $0.45 per share and a special distribution of $0.10 per share [7][32] - Total GAAP net income for the quarter was $0.67 per share, up from $0.37 per share in the previous quarter, positively impacted by net realized and unrealized gains [36] - The net asset value per share increased to $18.15 from $18.03 at the end of Q2 2024 [10][38] Business Line Data and Key Metrics Changes - Investment activity during Q3 was approximately $226 million, primarily focused on senior secured first lien loans [8][17] - The investment portfolio's fair value increased to $2.05 billion from $1.99 billion at the end of Q2 2024 [39] - First lien debt represented approximately 90% of the fair value of the overall portfolio, maintaining a steady percentage [18][46] Market Data and Key Metrics Changes - The company observed an increase in competitive dynamics in the private credit market, leading to additional spread compression, albeit at a slower pace than in the previous quarter [12] - The weighted average yield on debt and income-producing investments at cost declined to 10.9% from 11.3% at the end of Q2 2024 [46] - The watch list increased to 5.6% of the overall portfolio fair value, reflecting proactive portfolio management [49] Company Strategy and Development Direction - The company is focused on rotating out of higher-priced, lower-spread upper middle market positions into traditional middle market opportunities, which offer wider spreads and more attractive terms [9][18] - The strategy emphasizes maintaining a diversified portfolio across various metrics, including sponsor relationships and industry sectors [27] - The company aims to capitalize on increased M&A activity expected as the interest rate reduction cycle begins [16] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the U.S. economy's resilience and steady revenue growth from portfolio companies, despite elevated interest rates [15] - The company anticipates continued strong performance into 2025, driven by a robust pipeline of investment opportunities [26] - Management highlighted the importance of maintaining strong relationships with private equity sponsors to drive deal flow [62] Other Important Information - The company has a share repurchase program, utilizing approximately $14 million of the $100 million allocated, with plans to continue buying back shares as trading occurs at a discount to NAV [52][85] - The third lockup release occurred on October 21, increasing the number of shares available for trading significantly [53] Q&A Session Summary Question: Is there any white space across the broader Churchill platform to further penetrate the market? - Management noted a 30% increase in firms where new deals are being done and ongoing efforts to expand relationships with new private equity LPs [60][62] Question: What is the current deal flow and tone with sponsors? - Management reported a continued increase in deal activity, with Q3 showing a 60% year-over-year increase in senior lending activity [65] Question: How was amendment activity in the quarter? - There was no significant increase in amendment activity, with stable yields on new floating rate investments [68] Question: What is the size of the upper middle market portfolio being rotated to the core middle market strategy? - The upper middle market portion is approximately $200 million, which is about 10% of the total portfolio [74] Question: Can you describe the increase in the watch list investments this quarter? - The increase in the watch list was due to proactive portfolio management, with no new non-accruals during the quarter [80]

CHURCHII Nuveen Churchill Direct Lending Corp. (NCDL) Third Quarter 2024 Earnings 7 November 2024 Disclosure This presentation is for informational purposes only. It does not convey an offer of any type and is not intended to be, and should not be construed as, an offer to sell, or the solicitation of an offer to buy, any securities of Nuveen Churchill Direct Lending Corp. (the "Company," "NCDL," "we," "us" or "our"). Any such offering can be made only at the time an offeree receives a prospectus relating t ...