BCP Investment Corp. Q1 FY2025 earnings call

• During Q1, deployed $17.5 million into defensively positioned opportunities, had $15.7 million in repayments/sales, returning to net suppliers of capital. - Enthusiastic about merger with Logan Ridge for scale, liquidity, operational efficiency. - Board approved $0.47 per share base distribution, modified dividend policy to stable base. - Patrick: 88.5% of debt portfolio floating rate linked to SOFR, originations higher than repayments/sales, portfolio diversified across 24 industries, nonrecourse investments at 2.6% of portfolio, debt portfolio at fair value $314.1 million, 91.1% first lien loans. - Brandon: Investment income decrease due to lower non-recurring paydown/fee income, Sundance non-accrual, lower base rates, late deployment, lower CLO income; expenses decrease due to lower interest, management/incentive fees, general/administrative.

For the quarter ended March 31, 2025, Portman Ridge generated $12.1 million in investment income, a decrease of $2.3 million or $0.25 per share from the prior quarter. Total expenses were $7.8 million, a $1.1 million decrease from the prior quarter. Net investment income was $4.3 million or $0.47 per share, a $1.2 million or $0.13 per share decrease from the prior quarter. Net asset value as of March 31, 2025, was $173.5 million, a $5 million decrease from the prior quarter. Gross and net leverage ratios were flat at 1.5x and 1.3x respectively. The investment portfolio had 88.5% of debt securities as floating rate linked to SOFR, originations higher than repayments/sales, diversified across 24 industries, nonrecourse investments at 2.6% of portfolio, debt portfolio at fair value $314.1 million with 91.1% first lien loans.

• Confident in driving best outcomes for shareholders, active in market with healthy pipeline, fortified balance sheet, experienced team to generate strong risk-adjusted returns. - Anticipated opportunities from merger with Logan Ridge for scale and synergies.

• Macroeconomic uncertainty with shifting trade dynamics, inflation, monetary policy. - Potential issues with private equity sponsors not providing additional support if cycle prolongs. - Uncertainty with non-accrual investments like Sundance and Naviga.

Q: Follow-up on Sundance reversal and PIK income.

A: Brandon mentions out of period impact, Patrick talks about portfolio PIK trends and outlook for returning companies to cash pay.

Q: Dividend question.

A: Brandon explains no supplemental dividend due to no incremental NII above base.

Q: Risk of private equity sponsors not providing support.

A: Ted talks about sponsor support in middle market and potential changes if cycle prolongs.

Q: Non-accruals and recovery.

A: Ted and Patrick discuss non-accrual positions like Sundance and Naviga and recovery prospects.

Q: KCAP Freedom III dividend.

A: Ted explains dividend recognition as cost recovery and structure of joint venture.