Palmer Square Capital BDC (PSBD) Q1 2025 earnings summary

Executive summary

• Total investment income for Q1 2025 was $31.2 million, down from $34.8 million in Q1 2024, with net investment income at $12.9 million ($0.40 per share) versus $16.3 million ($0.52 per share) year-over-year.

• Net asset value per share declined to $15.85 from $16.50 at year-end 2024, with total net assets at $515.8 million as of March 31, 2025.

• Paid a $0.39 per share dividend for Q1 2025, including a $0.03 supplemental distribution; Q2 2025 base dividend of $0.36 per share declared, with a supplemental dividend announcement expected in June.

• Portfolio comprised 260 investments in 209 companies, with 98% in floating rate debt and only 0.24% of investments on non-accrual status.

• Maintains monthly NAV disclosure and emphasizes risk management, liquidity, and flexibility across liquid and private credit markets.

Financial highlights

• Net investment income per share decreased sequentially: $0.52 (Q1 2024), $0.48 (Q2/Q3 2024), $0.45 (Q4 2024), $0.40 (Q1 2025).

• Net realized and unrealized losses totaled $21.3 million, compared to gains of $6.6 million in Q1 2024.

• Debt-to-equity ratio remained stable at 1.50x; available liquidity increased to $229.5 million.

• Portfolio yield was 10.37% in Q1 2025, slightly down from 10.65% in Q4 2024, but up from 10.11% year-over-year.

• Total assets at quarter-end were $1.4 billion; total net assets were $515.8 million.

Outlook and guidance

• Management expects continued strong deal flow from a large addressable market, with ongoing focus on downside protection and credit quality.

• Maintains a conservative portfolio stance, holding dry powder to capitalize on future opportunities as volatility persists.

• Q2 2025 regular dividend of $0.36/share declared, with a supplemental dividend to be announced.

• Expects M&A volumes to remain muted due to macro uncertainty and evolving trade policy.

• Asset coverage ratio remains strong at 167%, supporting ongoing leverage and investment activity.