CHICAGO--(BUSINESS WIRE)--November 10, 2025--
Kayne Anderson BDC, Inc. (NYSE: KBDC) ("KBDC or the Company"), a business development company externally managed by its investment adviser, KA Credit Advisors, LLC, today announced its financial results for the third quarter ended September 30, 2025.
Financial Highlights for the Quarter Ended September 30, 2025
-- Net investment income of $30.0 million, or $0.43 per share;
-- Net asset value of $16.34 per share, decreased from $16.37 per share as
of June 30, 2025, primarily as a result of unrealized losses of $0.08
offset by higher net investment income earned over distributions paid of
$0.03 and accretive share repurchases of $0.02;
-- New private credit and equity co-investment commitments of $295.5
million, fundings of $273.6 million and repayments of $73.5 million,
resulting in a net funded private credit and equity investment increase
of $200.1 million;
-- Sales and repayments of broadly syndicated loans of $113.0 million;
-- The Company's Board of Directors (the "Board") declared a regular
dividend of $0.40 per share, to be paid on January 16, 2026 to
stockholders of record as of December 31, 2025.
"We delivered another solid quarter marked by strong origination activity, stable credit performance and a high-quality earnings mix. With nearly $300 million in new private credit investments at an average spread of 568bps over SOFR, we continue to see healthy deal flow in the core middle market, driven in-part by a recent pickup in M&A-related financing opportunities, which we believe bodes well for outlook in the near-term," said Doug Goodwillie, Co-Chief Executive Officer.
"Despite broader market volatility and headlines around the private credit space, our target market broadly and portfolio specifically continue to demonstrate strong fundamentals. We remain defensively positioned with 94% of our portfolio invested in first-lien senior secured loans, lending at an average leverage level of 4.2x, lower than many of our peers, and continue to be pleased with credit performance of our loan book with a non-accrual rate of just 1.4%," said Ken Leonard, Co-Chief Executive Officer. "We believe KBDC is well-positioned to continue its relative outperformance while generating attractive, risk-adjusted returns through varying market cycles."
Selected Financial Highlights
As of
-------------------------------------
(in thousands, expect per share
data) September 30, 2025 June 30, 2025
-------------------- ---------------
Investment portfolio, at fair
value $ 2,255,513 $ 2,174,640
Total assets $ 2,337,968 $ 2,255,991
Total debt outstanding, at
principal $ 1,153,000 $ 1,054,000
Net assets $ 1,140,096 $ 1,157,331
Net asset value per share $ 16.34 $ 16.37
Total debt-to-equity ratio 1.01x 0.91x
For the quarter ended
-------------------------------------
September 30, 2025 June 30, 2025
-------------------- ---------------
Net investment income per share $ 0.43 $ 0.40
Net realized and unrealized gains
(losses) per share(1) $ (0.08) $ (0.05)
Earnings per share $ 0.35 $ 0.35
Regular dividend per share $ 0.40 $ 0.40
Special dividend per share $ - $ 0.10
(1) Amounts shown may not correspond for the period as it includes the
effect of the timing of the distribution, shares repurchased, and the
issuance of common stock.
Results of Operations
Total investment income for the quarter ended September 30, 2025 was $61.3 million, as compared to $57.3 million for the quarter ended June 30, 2025. The increase was primarily driven by rotations out of the lower yielding broadly syndicated loans into middle market loans, accelerated amortization and fees earned from repayments and the impact of net additions to the portfolio during the third quarter. PIK income represented 3.5% of total interest income for the quarter ended September 30, 2025.
Net investment income for the quarter ended September 30, 2025 was $30.0 million or $0.43 per share as compared to $28.7 million or $0.40 per share for the quarter ended June 30, 2025. Net expenses for the third quarter were $31.3 million, as compared to $28.6 million for the quarter ended June 30, 2025. The increase was primarily the result of higher average borrowings on our credit facilities and increased base management fees as a partial fee waiver was in effect during the second quarter.
For the quarter ended September 30, 2025, the Company had a net change in unrealized losses on investments of $5.0 million. The unrealized losses for the quarter were primarily driven by negative fair value changes and quarterly amortization of original issue discounts, partially offset by new upfront fees for originations during the quarter. Additionally, the Company had $0.4 million of deferred income tax expense related to unrealized gains on equity investments in the Company's wholly owned taxable subsidiary.
Portfolio and Investment Activity
As of
------------------------------------------ ---
($ in thousands) September 30, 2025 June 30, 2025
-------------------- ---------------
Investments at fair value $ 2,255,513 $ 2,174,640
Number of portfolio
companies 108 114
Average portfolio company
investment size $ 20,884 $ 19,076
Asset class:
First lien debt 93.7% 98.0%
Subordinated debt 4.6% 0.8%
Equity 1.7% 1.2%
Non-accrual debt
investments:
Non-accrual investments at
fair value $ 30,974 $ 34,535
Non-accrual investments as
a percentage of debt
investments at fair value 1.4% 1.6%
Number of investments on
non-accrual 5 5
Interest rate type:
Percentage floating-rate 96.0% 100.0%
Percentage fixed-rate 4.0% 0.0%
Yields excluding non-income
producing debt investments
(at fair value):
Weighted average yield on
private middle market
loans 10.7% 10.9%
Weighted average yield on
broadly syndicated loans 6.7% 6.9%
Weighted average yield on
total debt portfolio 10.6% 10.6%
Yields including non-income
producing debt investments
(at fair value):
Weighted average yield on
private middle market
loans 10.5% 10.7%
Weighted average yield on
broadly syndicated loans 6.7% 6.9%
Weighted average yield on
total debt portfolio 10.4% 10.4%
Investment activity during
the quarter ended:
Gross new investment
commitments $ 295,492 (1) $ 128,675 (2)
Principal amount of
investments funded $ 273,574 (1) $ 128,665 (2)
Principal amount of
investments sold or
repaid $ (186,434) (1) $ (118,602) (2)
Net principal amount of
investments funded $ 87,140 $ 10,063
(1) For the quarter ended September 30, 2025, broadly syndicated loans
represent $0 of new investment commitments, $0 of investments funded
and $112,952 of investments sold or repaid.
(2) For the quarter ended June 30, 2025, broadly syndicated loans
represent $0 of new investment commitments, $0 of investments funded
and $46,506 of investments sold or repaid.
Liquidity and Capital Resources
As of September 30, 2025, the Company had $75 million senior unsecured notes outstanding, $1,078 million borrowed under its credit facilities and cash and cash equivalents of $46.1 million (including investments in money market funds). As of that date, the Company had $322 million of undrawn commitments available on its credit facilities (subject to borrowing base restrictions and other conditions).
As of September 30, 2025, the Company's debt-to-equity ratio was 1.01x and its asset coverage ratio was 199%. The Company targets a debt-to-equity ratio of 1.0x to 1.25x (which equates to asset coverage of 200% to 180%). During the third quarter, the Company reached the low end of its target debt-to-equity ratio range and expects to continue to grow its private credit portfolio. The Company may operate above or below its target based on market conditions.
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November 10, 2025 16:19 ET (21:19 GMT)
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