Nuveen Churchill Direct Lending (NCDL) Q1 2025 earnings summary

Executive summary

• Net investment income was $0.53 per share for Q1 2025, with adjusted NII at $0.56 per share excluding non-recurring costs; net asset value per share declined to $17.96 from $18.18 at year-end 2024.

• Portfolio remains highly diversified across 210 companies and 26 industries, with top 10 holdings representing 13% of fair value and average position size at 0.5%.

• Focus is on senior secured first lien loans, comprising 90.5% of the portfolio, with 91% of origination activity in this segment.

• Management remains confident in dividend coverage and long-term positioning, emphasizing disciplined investment and proactive monitoring amid macroeconomic uncertainty.

• Annualized ROE on net investment income was 12.1% for Q1 2025.

Financial highlights

• Total investment income was $53.6 million in Q1 2025, up from $51.6 million in Q1 2024, but down from $57.1 million in Q4 2024, mainly due to lower base rates.

• GAAP net income was $0.29 per share, reflecting $0.24 per share in net realized and unrealized losses.

• Net asset value per share decreased to $17.96 from $18.18 at year-end 2024.

• Gross originations were $166 million, with $153 million in gross investment fundings and $148.4 million in repayments and sales.

• Dividend of $0.55 per share paid in April (including $0.10 special), with a regular $0.45 per share declared for Q2 2025; annualized yield of 12.4% on NAV.

Outlook and guidance

• Management expects to maintain dividend coverage at the $0.45 per share level and is confident in forward earnings power.

• Anticipates modestly wider spreads and more favorable lending terms if market volatility persists.

• Portfolio rotation from upper middle market to traditional middle market assets will continue.

• Management remains focused on underwriting discipline and investing in high-quality companies amid market uncertainty.

• No plans to increase leverage above the current 1.31x gross debt-to-equity ratio.