Morgan Stanley Direct Lending Fund (MSDL) Q3 2024 earnings summary

Executive summary

• Net investment income rose to $58.7 million ($0.66 per share) in Q3 2024, up from $56.1 million ($0.63 per share) in Q2 2024, while earnings per share declined to $0.60 from $0.66 sequentially.

• Net asset value per share remained flat at $20.83 compared to the previous quarter, and net assets increased to $1.85 billion as of September 30, 2024.

• Portfolio fair value reached $3.64 billion, invested across 200 companies in 33 industries.

• 429,653 shares were repurchased at an average price of $20.06 during Q3 2024 under a $100 million buyback plan.

• Regular Q4 dividend of $0.50 per share and a $0.10 special dividend were declared, payable in January 2025.

Financial highlights

• Total investment income for Q3 2024 was $109.8 million, up from $104.2 million in Q2 2024.

• Net realized losses of $11.0 million in Q3 2024 were offset by $5.4 million in unrealized appreciation.

• Net asset value per share rose to $20.83 from $20.67 at year-end 2023 and remained stable sequentially.

• Debt outstanding at quarter end was $1.84 billion, with a debt-to-equity ratio of 0.99x.

• Distributions of $1.60 per share were declared for the nine months ended September 30, 2024.

Outlook and guidance

• The portfolio is positioned defensively with a focus on senior secured, first lien, and floating rate loans to U.S. middle market companies.

• Management expects sufficient liquidity for near-term operations, with $88.4 million in cash and significant credit facility availability.

• Management emphasizes capital preservation, risk mitigation, and long-term credit performance.

• Forward-looking statements caution that actual results may differ due to various risks and uncertainties.