GOLUB CAPITAL BDC, Inc.
For the period ended Mar 31, 2025. Filed May 5, 2025.
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A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Mar 31, 2025 · Filed May 5, 2025
GBDC$12.74-1.4%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2024-12-31; filed 2025-02-04.
0001476765-25-000016
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2025-03-31; filed 2025-05-05.
0001476765-25-000040
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 238 previous paragraphs and 250 current paragraphs.
163 unchanged; 72 reworded; 10 added; 1 removed; 2 previous and 5 current paragraphs rearranged.
Tables are not compared: 13 previous and 13 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (10)
Current report
(1) “Capital under management” is a gross measure of invested capital including leverage as of January 1, 2025.
Current report
(6)Total return based on net asset value per share is calculated as (a) net income per share for the period, (b) divided by net asset value per share as of the end of the period. Total return does not include sales load.
Current report
On April 4, 2025, we amended our JPM Credit Facility (as defined in Note 7 of our consolidated financial statements) to, among other things, (i) change the applicable margin to a range of 1.525% to 1.775%, (ii) reduce the unused fee rate on all unused commitments to 0.325% from 0.375%, (iii) extend the maturity date to April 4, 2030 from August 6, 2029 and (iv) amend the accordion provision to permit increases to the total commitments to up to $3.0 billion.
Current report
On May 2, 2025, Joshua M. Levinson resigned from his position as our Chief Compliance Officer. Mr. Levinson remains with Golub Capital and was promoted to Chief Operating Officer and Chief Legal Officer of the Firm in 2024.
Current report
On May 2, 2025, our board of directors appointed Wu-Kwan Kit as Chief Compliance Officer of the Company effective immediately. Ms. Kit has served as Senior BDC Counsel to Golub Capital since September 2024 and will continue in that role concurrent to her position as Chief Compliance Officer. Prior to joining Golub Capital, Ms. Kit was Senior Vice President and Senior Counsel at PIMCO, where she primarily supported its registered funds. Prior to this position, she worked at Van Eck Associates as Assistant General Counsel. Prior to that, Ms. Kit worked as an Associate at Schulte Roth & Zabel’s Investment Management Group. Ms. Kit earned her BA degree cum laude from the University of Pennsylvania. She received a JD from the University of Pennsylvania Law School.
Current report
For fiscal year 2025, including the period April 1, 2025 through May 5, 2025, Wells Fargo Securities, LLC, as broker, has repurchased 2,521,275 shares of our common stock pursuant to the Program (as defined in Note 2 of our consolidated financial statements) for an aggregate purchase price of approximately $35.3 million at an average price of $14.00 per share.
Current report
For the six months ended March 31, 2025, we had $110.8 million in unrealized appreciation on 244 portfolio company investments, which was offset by $71.9 million in unrealized depreciation on 170 portfolio company investments. For the six months ended March 31, 2024, we had $58.2 million in unrealized appreciation on 224 portfolio company investments, which was offset by $41.2 million in unrealized depreciation on 159 portfolio company investments.
Current report
On October 2, 2020, we issued $400.0 million in aggregate principal amount of the 2024 Notes (as defined in Note 7 of our consolidated financial statements). On October 15, 2021, we issued an additional $100.0 million in aggregate principal of the 2024 Notes. On April 8, 2024, we redeemed the $500.0 million in aggregate principal amount of the 2024 Notes, or 100% of the principal amount, plus the accrued and unpaid interest thereon.
Current report
2029 Notes
Current report
•GC Advisors agreed to irrevocably waive any incentive fees payable under the Prior Investment Advisory Agreement in excess of 15% and waive incentive fees in excess of an incentive fee cap that was also reduced to 15%, in each case effective as of January 1, 2024 for periods ending on or prior to the earlier of (i) the closing of the acquisition of GBDC 3 pursuant to the GBDC 3 Merger Agreement or (ii) the termination of the GBDC 3 Merger Agreement (the “Waiver Period”). During the Waiver Period, fees payable to the Investment Adviser under the Prior Investment Advisory Agreement, net of the GBDC 3 Merger Waiver, was equal to what was payable under the Investment Advisory Agreement, which was entered into and effective upon closing of the GBDC 3 Merger Agreement.
Removed paragraphs (1)
Previous report
Represents an amount less than 0.1%.
Reworded paragraphs (72)
Previous wording
•our business prospects and the prospects of our portfolio companies, including our and their ability to achieve our respective objectives due to disruptions, including those caused by global health pandemics, such as the COVID-19 pandemic, or other large scale events;
Current wording
•our business prospects and the prospects of our portfolio companies, including our and their ability to achieve our respective objectives due to disruptions, including, without limitation, those caused by global health pandemics, or other large scale events;
Previous wording
•general economic and political trends and other external factors, including the COVID-19 pandemic;
Current wording
•general economic and political trends and other external factors;
Previous wording
•elevating levels of inflation, and its impact on us, on our portfolio companies and on the industries in which we invest;
Current wording
•elevated levels of inflation, and its impact on us, on our portfolio companies and on the industries in which we invest;
Previous wording
•the ability of GC Advisors to continue to effectively manage our business due to disruptions, including those caused by global health pandemics, such as the COVID-19 pandemic, or other large scale events;
Current wording
•the ability of GC Advisors to continue to effectively manage our business due to disruptions, including those caused by global health pandemics, or other large scale events;
Previous wording
•turmoil in Ukraine and Russia and the Middle East, including sanctions related to such turmoil, and the potential for volatility in energy prices and other supply chain issues and any impact on the industries in which we invest;
Current wording
•turmoil in Ukraine, Russia and the Middle East, including sanctions related to such turmoil, and the potential for volatility in energy prices and other supply chain issues and any impact on the industries in which we invest;
Previous wording
One stop loans include loans to technology companies undergoing strong growth due to new services, increased adoption and/or entry into new markets. We refer to loans to these companies as recurring revenue loans. Other targeted characteristics of recurring revenue businesses include strong customer revenue retention rates, a diversified customer base and backing from growth equity or venture capital firms. In some cases, the borrower’s high revenue growth is supported by a high level of discretionary spending. As part of the underwriting of such loans and consistent with industry practice, we adjust our characterization of the earnings of such borrowers for a reduction or elimination of such discretionary expenses, if appropriate. As of December 31, 2024 and September 30, 2024, one stop loans included $1,104.2 million and $1,021.3 million, respectively, of recurring revenue loans at fair value.
Current wording
One stop loans include loans to technology companies undergoing strong growth due to new services, increased adoption and/or entry into new markets. We refer to loans to these companies as recurring revenue loans. Other targeted characteristics of recurring revenue businesses include strong customer revenue retention rates, a diversified customer base and backing from growth equity or venture capital firms. In some cases, the borrower’s high revenue growth is supported by a high level of discretionary spending. As part of the underwriting of such loans and consistent with industry practice, we adjust our characterization of the earnings of such borrowers for a reduction or elimination of such discretionary expenses, if appropriate. As of March 31, 2025 and September 30, 2024, one stop loans included $949.1 million and $1,021.3 million, respectively, of recurring revenue loans at fair value.
Previous wording
As of December 31, 2024 and September 30, 2024, we had debt and equity investments in 386 and 381 portfolio companies, respectively.
Current wording
As of March 31, 2025 and September 30, 2024, we had debt and equity investments in 393 and 381 portfolio companies, respectively.
Previous wording
The following table shows the weighted average income yield and weighted average investment income yield of our earning portfolio company investments, which represented nearly 100% of our debt investments, as well as the total return based on our average net asset value, and the total return based on the change in the quoted market price of our stock and assuming distributions were reinvested in accordance with our dividend reinvestment plan, or DRIP, in each case for three months ended December 31, 2024, September 30, 2024 and December 31, 2023:
Current wording
The following table shows the weighted average annualized income yield and weighted average annualized investment income yield of both our earning and total portfolio company investments, which represented nearly 100% of our debt investments, as well as the annualized total return based on (i) our average net asset value, (ii) our average net asset value per share, and (iii) the change in the quoted market price of our stock and assuming distributions were reinvested in accordance with our dividend reinvestment plan, or DRIP, in each case for the three months ended March 31, 2025 and December 31, 2024 and the six months ended March 31, 2025 and March 31, 2024:
Previous wording
(1)Represents income from interest, fees, interest earned on cash, accrued PIK and non-cash dividend income, excluding amortization of capitalized fees, discounts and purchase premium (as described in “Note 2. Significant Accounting Policies and Recent Accounting Updates” of the consolidated financial statements), divided by the daily average fair value of earning portfolio company investments, and does not represent a return to any investor in us.
Current wording
(1)Represents income from interest, fees, interest earned on cash, accrued PIK and non-cash dividend income, excluding amortization of capitalized fees, discounts and purchase premium (as described in Note 2 of the consolidated financial statements), divided by the daily average fair value of earning portfolio company investments, and does not represent a return to any investor in us.
Previous wording
(2)Represents income from interest, fees, interest earned on cash, accrued PIK and non-cash dividend income and amortization of capitalized fees and discounts, excluding amortization of purchase premium (as described in “Note 2. Significant Accounting Policies and Recent Accounting Updates” of the consolidated financial statements), divided by the daily average fair value of earning portfolio investments, and does not represent a return to any investor in us.
Current wording
(2)Represents income from interest, fees, interest earned on cash, accrued PIK and non-cash dividend income and amortization of capitalized fees and discounts, excluding amortization of purchase premium (as described in Note 2 of the consolidated financial statements), divided by the daily average fair value of earning portfolio company investments, and does not represent a return to any investor in us.
Previous wording
(3)Represents income from interest, fees, interest earned on cash, accrued PIK and non-cash dividend income, excluding amortization of capitalized fees, discounts and purchase premium (as described in “Note 2. Significant Accounting Policies and Recent Accounting Updates” of the consolidated financial statements), divided by the daily average total fair value of portfolio company investments, and does not represent a return to any investor in us.
Current wording
(3)Represents income from interest, fees, interest earned on cash, accrued PIK and non-cash dividend income, excluding amortization of capitalized fees, discounts and purchase premium (as described in Note 2 of the consolidated financial statements), divided by the daily average total fair value of portfolio company investments, and does not represent a return to any investor in us.
Previous wording
(4)Represents income from interest, fees, interest earned on cash, accrued PIK and non-cash dividend income and amortization of capitalized fees and discounts, excluding amortization of purchase premium (as described in “Note 2. Significant Accounting Policies and Recent Accounting Updates” of the consolidated financial statements), divided by the daily average total fair value of portfolio investments, and does not represent a return to any investor in us.
Current wording
(4)Represents income from interest, fees, interest earned on cash, accrued PIK and non-cash dividend income and amortization of capitalized fees and discounts, excluding amortization of purchase premium (as described in Note 2 of the consolidated financial statements), divided by the daily average total fair value of portfolio company investments, and does not represent a return to any investor in us.
Previous wording
(6)Total return based on market value assumes distributions are reinvested in accordance with the DRIP. Total return does not include sales load.
Current wording
(7)Total return based on market value assumes distributions are reinvested in accordance with the DRIP. Total return does not include sales load.
Previous wording
Revenues: We generate revenue in the form of interest and fee income on debt investments and capital gains and distributions, if any, on portfolio company investments that we originate or acquire. Our debt investments, whether in the form of senior secured, one stop, second lien or subordinated loans, typically have a term of three to seven years and bear interest at a fixed or floating rate. In some instances, we receive payments on our debt investments based on scheduled amortization of the outstanding balances. In addition, we receive repayments of some of our debt investments prior to their scheduled maturity date. The frequency or volume of these repayments fluctuates significantly from period to period. Our portfolio activity also reflects the proceeds of sales of securities. In some cases, our investments provide for deferred interest payments or PIK interest. The principal amount of loans and any accrued but unpaid interest generally become due at the maturity date.
Current wording
Revenues: We generate revenue in the form of interest and fee income on debt investments and capital gains and distributions, if any, on portfolio company investments that we originate or acquire. Our debt investments, whether in the form of senior secured, one stop, second lien or subordinated loans, typically have a term of three to seven years and bear interest at a fixed or floating rate. In some instances, we receive payments on our debt investments based on scheduled amortization of the outstanding balances. In addition, we receive repayments of some of our debt investments prior to their scheduled maturity date. The frequency or volume of these repayments fluctuates significantly from period to period. Our portfolio activity also reflects the proceeds of sales of securities.
Previous wording
Collateral management fees are paid directly by the 2018 Issuer, GCIC 2018 Issuer, GBDC 3 2021 Issuer, GBDC 3 2022 Issuer, GBDC 2 2022-2 Issuer and the 2024 Issuer and are offset against the management fees payable under the Investment Advisory Agreement. The 2018 Issuer paid Morgan Stanley & Co. LLC structuring and placement fees for its services in connection with the structuring of the 2018 Debt Securitization. Before we acquired the GCIC 2018 Issuer as part of our acquisition of Golub Capital Investment Corporation, a Maryland corporation, or GCIC, on September 6, 2019, the GCIC 2018 Issuer paid Wells Fargo Securities, LLC structuring and placement fees for its services in connection with the initial structuring of the GCIC 2018 Debt Securitization. Before we acquired the GBDC 3 2022 Issuer as a part of our acquisition of Golub Capital BDC 3, Inc., or GBDC 3, on June 3, 2024, the GBDC 3 2022 Issuer paid Deutsche Bank AG, New York Branch, structuring and placement fees for its services in connection with the structuring of the GBDC 3 2022 Debt Securitization (as defined in “Note 7. Borrowings” of our consolidated financial statements). Before we acquired the GBDC 3 2022-2 Issuer as a part of our acquisition of GBDC 3 on June 3, 2024, the GBDC 3 2022-2 Issuer paid GreensLedge Capital Markets LLC and KeyBanc Capital Markets Inc. structuring and placement fees for its services in connection with the structuring of the GBDC 3 2022-2 Debt Securitization (as defined in “Note 7. Borrowings” of our consolidated financial statements).Term debt securitizations are also known as CLOs, and are a form of secured financing incurred by us, which are consolidated by us and subject to our overall asset coverage requirement. The 2018 Issuer, GCIC 2018 Issuer, GBDC 3 2021 Issuer, GBDC 3 2022 Issuer, GBDC 3 2022-2 Issuer and the 2024 Issuer also agreed to pay ongoing administrative expenses to the trustee, collateral manager, independent accountants, legal counsel, rating agencies and independent managers in connection with developing and maintaining reports, and providing required services in connection with the administration of the 2018 Debt Securitization, GCIC 2018 Debt Securitization, the GBDC 3 2021 Debt Securitization, the GBDC 3 2022 Debt Securitization, the GBDC 3 2022-2 Debt Securitization and the 2024 Debt Securitization and collectively the Debt Securitizations, as applicable.
Current wording
Collateral management fees are paid directly by the 2018 Issuer, GCIC 2018 Issuer, GBDC 3 2021 Issuer, GBDC 3 2022 Issuer, GBDC 2 2022-2 Issuer and the 2024 Issuer and are offset against the management fees payable under the Investment Advisory Agreement. The 2018 Issuer paid Morgan Stanley & Co. LLC structuring and placement fees for its services in connection with the structuring of the 2018 Debt Securitization. Before we acquired the GCIC 2018 Issuer as part of our acquisition of Golub Capital Investment Corporation, a Maryland corporation, or GCIC, on September 6, 2019, the GCIC 2018 Issuer paid Wells Fargo Securities, LLC structuring and placement fees for its services in connection with the initial structuring of the GCIC 2018 Debt Securitization. Before we acquired the GBDC 3 2022 Issuer as a part of our acquisition of Golub Capital BDC 3, Inc., or GBDC 3, on June 3, 2024, the GBDC 3 2022 Issuer paid Deutsche Bank AG, New York Branch, structuring and placement fees for its services in connection with the structuring of the GBDC 3 2022 Debt Securitization (as defined in Note 7 of our consolidated financial statements). Before we acquired the GBDC 3 2022-2 Issuer as a part of our acquisition of GBDC 3 on June 3, 2024, the GBDC 3 2022-2 Issuer paid GreensLedge Capital Markets LLC and KeyBanc Capital Markets Inc. structuring and placement fees for its services in connection with the structuring of the GBDC 3 2022-2 Debt Securitization (as defined in Note 7 of our consolidated financial statements).Term debt securitizations are also known as CLOs, and are a form of secured financing incurred by us, which are consolidated by us and subject to our overall asset coverage requirement. The 2018 Issuer, GCIC 2018 Issuer, GBDC 3 2021 Issuer, GBDC 3 2022 Issuer, GBDC 3 2022-2 Issuer and the 2024 Issuer also agreed to pay ongoing administrative expenses to the trustee, collateral manager, independent accountants, legal counsel, rating agencies and independent managers in connection with developing and maintaining reports, and providing required services in connection with the administration of the 2018 Debt Securitization, GCIC 2018 Debt Securitization, the GBDC 3 2021 Debt Securitization, the GBDC 3 2022 Debt Securitization, the GBDC 3 2022-2 Debt Securitization and the 2024 Debt Securitization and collectively the Debt Securitizations, as applicable.
Previous wording
On June 3, 2024, we completed our acquisition of GBDC 3, pursuant to the GBDC 3 Merger Agreement. Pursuant to the GBDC 3 Merger Agreement, and, immediately following the Initial GBDC 3 Merger, GBDC 3 was then merged with and into us, with us as the surviving company. As a result of, and as of the effective time of, the GBDC 3 Merger, GBDC 3’s separate existence ceased.
Current wording
On June 3, 2024, we completed our acquisition of GBDC 3, pursuant to the GBDC 3 Merger Agreement (as defined in Note 1 of our consolidated financial statements). Pursuant to the GBDC 3 Merger Agreement, and, immediately following the initial merger of GBDC 3 Merger Sub (as defined in Note 1 of our consolidated financial statements) with and into GBDC 3, was then merged with and into us, with us as the surviving company. As a result of, and as of the effective time of, the GBDC 3 Merger, GBDC 3’s separate existence ceased.
Previous wording
Upon the consummation of the GBDC 3 Merger, we entered into the Investment Advisory Agreement, with GC Advisors, which replaced the Fourth Amended and Restated Investment Advisory Agreement by and between the Company and the Investment Adviser dated as of July 1, 2023 (the “Prior Investment Advisory Agreement”).
Current wording
Upon the consummation of the GBDC 3 Merger, we entered into the Investment Advisory Agreement, with GC Advisors, which replaced the Fourth Amended and Restated Investment Advisory Agreement by and between the Company and the Investment Adviser dated as of July 1, 2023 or the Prior Investment Advisory Agreement.
Previous wording
Consolidated operating results for three months ended December 31, 2024, September 30, 2024 and December 31, 2023 are as follows:
Current wording
Consolidated operating results for the three months ended March 31, 2025 and December 31, 2024 and the six months ended March 31, 2025 and March 31, 2024 are as follows:
Previous wording
Investment income decreased from the three months ended September 30, 2024 to the three months ended December 31, 2024 by $3.7 million primarily due to (1) a $4.9 million decrease in PIK interest income driven by refinancing and repayments of loans with a PIK feature and (2) declining interest base rates, and to a lesser extent, spread compression on amendments and new originations on the portfolio during the three months ended December 31, 2024 that were partially offset by (1) an increase in interest income as a result of an increase in the average earning debt investments balance of $347.2 million, (2) an increase in discount amortization driven by increased repayments and (3) an increase in cash dividend income. Investment income increased from the three months ended December 31, 2023 to the three months ended December 31, 2024 by $55.9 million, primarily due to (1) an increase in interest income as a result of an increase in the average earning debt investments balance of $2,592.1 million primarily driven by our acquisition of GBDC 3 and (2) an increase in non-cash dividend income driven by an increase in the average earning preferred equity investments balance of $104.6 million.
Current wording
Investment income decreased from the three months ended December 31, 2024 to the three months ended March 31, 2025 by $6.8 million primarily due to a decrease in interest and payment-in-kind (“PIK”) interest income primarily due to (i) declining interest base rates primarily due to the timing of resetting interest rate contracts, (ii) the reversal of $1.8 million of previously recognized interest and PIK interest income resulting from loans that were placed on non-accrual status during the three months ended March 31, 2025 and, to a lesser extent, (iii) a decrease of interest earned on cash to $1.5 million during the three months ended March 31, 2025 from $3.2 million during the three months ended December 31, 2024, that were partially offset by (i) an increase in interest income as a result of an increase in the average earning debt investments balance of $231.9 million and (ii) an increase in discount amortization acceleration and prepayment fee income driven by increased repayments as compared to the three months ended December 31, 2024. Investment income increased from the six months ended March 31, 2024 to the six months ended March 31, 2025 by $105.6 million, primarily due to (1) an increase in interest income as a result of an increase in the average earning debt investments balance of $2,744.8 million primarily driven by our acquisition of GBDC 3 and (2) an increase in non-cash dividend income driven by an increase in the average earning preferred equity investments balance of $108.1 million primarily driven by our acquisition of GBDC 3.
Previous wording
The annualized income yield by debt security type for three months ended December 31, 2024, September 30, 2024 and December 31, 2023 are as follows:
Current wording
The annualized income yield by debt security type for the three months ended March 31, 2025 and December 31, 2024 and the six months ended March 31, 2025 and March 31, 2024 are as follows:
Previous wording
Income yields on senior secured and one stop loans decreased for the three months ended December 31, 2024 as compared to the three months ended September 30, 2024 and for the three months ended December 31, 2024 as compared to the three months ended December 31, 2023, primarily due to declining interest base rates and, to a lesser extent, spread compression on amendments and new originations during the second half of calendar year 2024. Our loan portfolio is partially insulated from a drop in floating interest rates, as 97.8% of the loan portfolio at fair value is subject to an interest rate floor. As of December 31, 2024 and September 30, 2024, the weighted average base rate floor of our loans was 0.79% and 0.81%, respectively.
Current wording
Income yields on senior secured and one stop loans decreased for the three months ended March 31, 2025 as compared to the three months ended December 31, 2024 and for the six months ended March 31, 2025 as compared to the six months ended March 31, 2024, primarily due to declining interest base rates. Our loan portfolio is partially insulated from a drop in floating interest rates, as 97.6% of the loan portfolio at fair value is subject to an interest rate floor. As of March 31, 2025 and September 30, 2024, the weighted average base rate floor of our loans was 0.79% and 0.81%, respectively.
Previous wording
The following table summarizes our expenses for the three months ended December 31, 2024, September 30, 2024 and December 31, 2023:
Current wording
The following table summarizes our expenses for the three months ended March 31, 2025 and December 31, 2024 and the six months ended March 31, 2025 and March 31, 2024:
Previous wording
Interest and other debt financing expenses, including amortization of debt issuance costs, increased from the three months ended September 30, 2024 to the three months ended December 31, 2024 by $13.0 million, primarily due to (1) $4.6 million of net unrealized losses related to the fair value hedge of the interest rate swaps on the 2028 and 2029 Notes recognized during the three months ended December 31, 2024 compared to $7.6 million of unrealized gains related to the fair value hedge of the interest rate swaps on the 2028 and 2029 Notes recognized during the three months ended September 30, 2024 and, to a lesser extent, (2) increased interest expense due to an increase in average debt outstanding of $434.2 million driven by the series of debt funding structure initiatives undertaken in November and December 2024 including the 2024 Debt Securitization issuance of $1.3 billion in notes which bear interest at a weighted-average rate of three-month SOFR + 1.58% and the additional 2029 Note issuance, for which GBDC did not recognize the full benefit of the reduced borrowing costs during the three months ended December 31, 2024 due to the timing of the refinancing. Interest and other debt financing expenses, including amortization of debt issuance costs, increased from the three months ended December 31, 2023 to the three months ended December 31, 2024 by $38.1 million, primarily due to (1) an increase in average debt outstanding of $1,692 million driven by (i) the assumption of GBDC 3’s debt facilities and (ii) the issuance of the 2029 Notes and (2) rising interest base rates on borrowings from our floating rate debt facilities. For more information about our outstanding borrowings for the three months ended December 31, 2024 and 2023, including the terms thereof, see “Note 7. Borrowings” in the notes to our consolidated financial statements and the “Liquidity and Capital Resources” section below.
Current wording
Interest and other debt financing expenses, including amortization of debt issuance costs, decreased from the three months ended December 31, 2024 to the three months ended March 31, 2025 by $9.7 million, primarily due to (1) decreased interest expense driven by (i) the Company experiencing the full benefit during the three months ended March 31, 2025 of the debt capital refinancings completed during the fiscal year 2025 first quarter and (ii) lower interest base rates due to the timing of resetting interest rate contracts, (2) less than $0.1 million of net unrealized losses related to the fair value hedge of the interest rate swaps on the 2028 and 2029 Notes recognized during the three months ended March 31, 2025 compared to $4.6 million of net unrealized losses related to the fair value hedge of the interest rate swaps on the 2028 and 2029 Notes recognized during the three months ended December 31, 2024 that was partially offset by increased interest expense incurred on the increase in average debt outstanding of $64.4 million during the three months ended March 31, 2025. Interest and other debt financing expenses, including amortization of debt issuance costs, increased from the six months ended March 31, 2024 to the six months ended March 31, 2025 by $63.9 million, primarily due to an increase in average debt outstanding of $1,667.4 million driven by (1) the assumption of GBDC 3’s debt facilities and (2) the issuance of the 2029 Notes that was partially offset by decreasing interest base rates on borrowings from our floating rate debt facilities for the six months ended March 31, 2025 as compared to the six months ended March 31, 2024. For more information about our outstanding borrowings for the three and six months ended March 31, 2025 and 2024, including the terms thereof, see Note 7 in the notes to our consolidated financial statements and the “Liquidity and Capital Resources” section below.
Previous wording
For the three months ended December 31, 2024 and September 30, 2024, the effective annualized average interest rate, which includes amortization of debt financing costs, amortization of discounts on notes issued, non-usage facility fees and the net contractual interest rate swap expense on the 2028 and 2029 Notes but excluding the net gain/(loss) related to the fair value hedges associated with the 2028 and 2029 Notes interest rate swaps, on our total debt was 6.2% and 6.8%, respectively. For the three months ended December 31, 2023, the effective annualized average interest rate, which includes amortization of debt financing costs, amortization of discounts on notes issued and non-usage facility fees and the net contractual interest rate swap expense on the 2028 Notes but excluding the net gain/(loss) related to the fair value hedges associated with the 2028 Notes interest rate swaps, on our total debt was 5.4%. The effective average interest rate decreased for the three months ended December 31, 2024 compared to the three months ended September 30, 2024 primarily due to declining interest base rates and, to a lesser extent, reduced borrowing costs resulting from the debt capital refinancing during the three months ended December 31, 2024. The effective annualized average interest rate increased for the three months ended December 31, 2024 compared to the three months ended December 31, 2023 primarily due to the 2029 Notes issuance, a full period of the 2028 Notes issuance, the redemption of the 2024 Notes in April 2024 that bore interest at a rate of 3.375% and rising interest rates on our borrowings from floating rate debt facilities.
Current wording
For the three months ended March 31, 2025 and December 31, 2024, the effective annualized average interest rate, which includes amortization of debt financing costs, amortization of discounts on notes issued, non-usage facility fees and the net contractual interest rate swap expense on the 2028 and 2029 Notes but excluding the net unrealized gain/(loss) related to the fair value hedges associated with the 2028 and 2029 Notes interest rate swaps, on our total debt was 5.9% and 6.2%, respectively. For the six months ended March 31, 2025 and 2024, the effective annualized average interest rate, which includes amortization of debt financing costs, amortization of discounts on notes issued and non-usage facility fees and the net contractual interest rate swap expense on the 2028 and 2029 Notes but excluding the net unrealized gain/(loss) related to the fair value hedges associated with the 2028 and 2029 Notes interest rate swaps, on our total debt, on our total debt was 6.0% and 5.6%, respectively. The effective average interest rate decreased for the three months ended March 31, 2025 compared to the three months ended December 31, 2024 primarily due to reduced borrowing costs for the entire period resulting from the debt capital refinancing completed during the three months ended December 31, 2024 and lower interest base rates due to the timing of resetting interest rate contracts on our floating rate debt facilities. The effective annualized average interest rate increased for the six months ended March 31, 2025 compared to the six months ended March 31, 2024 primarily due to the 2029 Notes issuance, a full period of the 2028 Notes issuance and, the redemption of the 2024 Notes in April 2024 that bore interest at a rate of 3.375%.
Previous wording
The base management fee increased from the three months ended September 30, 2024 to the three months ended December 31, 2024 primarily due to an increase in average adjusted gross assets from the three months ended September 30, 2024 to the three months ended December 31, 2024.
Current wording
The base management fee increased by $0.1 million from the three months ended December 31, 2024 to the three months ended March 31, 2025 primarily due to an increase in average adjusted gross assets from the three months ended December 31, 2024 to the three months ended March 31, 2025.
Previous wording
The base management fee increased from the three months ended December 31, 2023 to the three months ended December 31, 2024 primarily due to an increase in average adjusted gross assets primarily as a result of our acquisition of GBDC 3 in June 2024.
Current wording
The base management fee increased from the six months ended March 31, 2024 to the six months ended March 31, 2025 primarily due to an increase in average adjusted gross assets primarily as a result of our acquisition of GBDC 3 in June 2024.
Previous wording
The Income Incentive Fee increased by $5.0 million from the three months ended September 30, 2024 to the three months ended December 31, 2024 primarily due to a $7.8 million income incentive fee waiver unilaterally provided by GC Advisors during the three months ended September 30, 2024. The Income Incentive Fee decreased by $3.2 million from the three months ended December 31, 2023 to the three months ended December 31, 2024 primarily due to the permanent reduction of the income incentive fee and capital gain incentive fee rate from 20% to 15% upon the close of the acquisition of GBDC 3 in June 2024. For each of three months ended December 31, 2024, September 30, 2024 and December 31, 2023, we were fully through the Income Incentive Fee “catch-up” provision and the Income Incentive Fee was equal to 15% of Pre-Incentive Fee Net Investment Income for the three months ended December 31, 2024 and September 30, 2024, and was equal to 20% of Pre-Incentive Fee Net Investment Income for the three months ended December 31, 2023.
Current wording
The Income Incentive Fee increased by $0.2 million from the three months ended December 31, 2024 to the three months ended March 31, 2025. due to an increase in Pre-Incentive Fee Net Investment Income and a greater rate of return on the value of our net assets driven by net funds growth. The Income Incentive Fee decreased by $0.4 million from the six months ended March 31, 2024 to the six months ended March 31, 2025 primarily due to the permanent reduction of the income incentive fee and capital gain incentive fee rate from 20% to 15% upon the close of the acquisition of GBDC 3 in June 2024. For each of the three months ended March 31, 2025 and December 31, 2024 and the six months ended March 31, 2025 and March 31, 2024, we were fully through the Income Incentive Fee “catch-up” provision and the Income Incentive Fee was equal to 15% of Pre-Incentive Fee Net Investment Income for the three months ended March 31, 2025, December 31, 2024 and March 31, 2024, net of the GBDC 3 Merger Waiver (as defined in Note 3 of our consolidated financial statements) and 20% of Pre-Incentive Fee Net Investment Income for the three months ended December 31, 2023.
Previous wording
In total, professional fees, the administrative service fee and general and administrative expenses increased by $1.4 million from the three months ended December 31, 2023 to the three months ended December 31, 2024, primarily due to an increase in the administrative service fee and professional fees.
Current wording
In total, professional fees, the administrative service fee and general and administrative expenses increased by $0.1 million from the three months ended December 31, 2024 to the three months ended March 31, 2025 primarily due to an increase in the administrative service fee that was partially offset by decreases in professional fees and general and administrative expenses.
Previous wording
In total, professional fees, the administrative service fee and general and administrative expenses increased by $0.7 million from the three months ended September 30, 2024 to the three months ended December 31, 2024 primarily due to an increase in the administrative service fee and professional fees.
Current wording
In total, professional fees, the administrative service fee and general and administrative expenses increased by $2.9 million from the six months ended March 31, 2024 to the six months ended March 31, 2025, primarily due to an increase in the administrative service fee and professional fees.
Previous wording
The Administrator pays for certain expenses incurred by us. These expenses are subsequently reimbursed in cash. Total expenses reimbursed to the Administrator during the three months ended December 31, 2024, September 30, 2024 and December 31, 2023 were $2.7 million, $3.2 million, and $2.0 million, respectively.
Current wording
The Administrator pays for certain expenses incurred by us. These expenses are subsequently reimbursed in cash. Total expenses reimbursed to the Administrator during the three months ended March 31, 2025 and December 31, 2024 and the six months ended March 31, 2025 and March 31, 2024 were $1.7 million, $2.7 million, $4.4 million and $4.0 million, respectively.
Previous wording
As of December 31, 2024 and September 30, 2024, included in accounts payable and other liabilities were $1.7 million and $2.7 million, respectively, of expenses paid on behalf of us by the Administrator.
Current wording
As of March 31, 2025 and September 30, 2024, included in accounts payable and other liabilities were $1.9 million and $2.7 million, respectively, of expenses paid on behalf of us by the Administrator.
Previous wording
The following table summarizes our net realized and unrealized gains (losses) for three months ended December 31, 2024, September 30, 2024 and December 31, 2023:
Current wording
The following table summarizes our net realized and unrealized gains (losses) for the three months ended March 31, 2025 and December 31, 2024 and the six months ended March 31, 2025 and March 31, 2024:
Previous wording
During the three months ended December 31, 2024, we had a net realized loss of $27.9 million, primarily attributable to realized losses recognized on (i) the restructuring of equity and debt investments of two portfolio company investments and the sale of a portfolio company debt investment, and (ii) net realized losses recognized on the translation of foreign currency amounts and transactions into U.S. dollars, that were partially offset by (i) net realized gains recognized on the settlement of forward currency contracts and (ii) $0.4 million of realized gain recognized on the sale of one equity investment. During the three months ended September 30, 2024, we had a net realized loss of $29.5 million primarily attributable to the realized losses recognized on (i) the restructure of equity and debt investments in multiple portfolio companies and (ii) the disposition of an equity investment of a portfolio company, that were partially offset by realized gains recognized on the settlement of forward currency contracts. During the three months ended December 31, 2023, we had a net realized gain of $1.1 million primarily attributable to the realized gain recognized on the sale of an equity investment and the translation of foreign currency amounts and transactions into U.S. dollars that were partially offset by realized losses on the disposition of an equity investment of a portfolio company.
Current wording
During the three months ended March 31, 2025, we had a net realized loss of $11.0 million, primarily attributable to realized losses recognized on (i) the restructuring of debt and equity investments oftwo portfolio company investments and (ii) net realized gains recognized on the settlement of forward currency contracts and translation of foreign currency amounts and transactions into U.S. dollars. During the three months ended December 31, 2024, we had a net realized loss of $27.9 million, primarily attributable to realized losses recognized on (i) the restructure of debt and equity investments of two portfolio company investments and the sale of a portfolio company debt investment, and (ii) net realized losses recognized on the translation of foreign currency amounts and transactions into U.S. dollars and settlement of forward currency contracts, that were partially offset by $0.4 million of realized gain recognized on the sale of one equity investment.
Previous wording
For the three months ended December 31, 2024, we had $81.2 million in unrealized appreciation on 225 portfolio company investments, which was offset by $37.6 million in unrealized depreciation on 174 portfolio company investments. For the three months ended September 30, 2024, we had $58.7 million in unrealized appreciation on 196 portfolio company investments, which was offset by $55.1 million in unrealized depreciation on 224 portfolio company investments. For the three months ended December 31, 2023, we had $32.8 million in unrealized appreciation on 153 portfolio company investments, which was offset by $42.1 million in unrealized depreciation on 213 portfolio company investments.
Current wording
For the three months ended March 31, 2025, we had $47.1 million in unrealized appreciation on 188 portfolio company investments, which was offset by $51.8 million in unrealized depreciation on 226 portfolio company investments. For the three months ended December 31, 2024, we had $81.2 million in unrealized appreciation on 225 portfolio company investments, which was offset by $37.6 million in unrealized depreciation on 174 portfolio company investments.
Previous wording
Unrealized appreciation for the three months ended December 31, 2024 and September 30, 2024 was primarily due to unrealized appreciation resulting from solid borrower credit trends across our portfolio and the reversal of previously recognized unrealized depreciation (i) on the disposition or restructuring of portfolio company investments and (ii) spread tightening in the market during the second half of calendar year 2024. Unrealized appreciation for the three months ended December 31, 2023 primarily resulted from the improved performance of certain portfolio companies and the reversal of unrealized depreciation due to spread tightening in the market during the second half of calendar year 2023.
Current wording
Unrealized appreciation for the six months ended March 31, 2025 was primarily due to (i) the reversal of previously recognized unrealized depreciation on the restructuring of portfolio company investments and (ii) fair valuing recent originations up to or near par. Unrealized appreciation for the six months ended March 31, 2024 primarily resulted from the improved performance of certain portfolio companies and the reversal of unrealized depreciation due to spread tightening in the market during the second half of calendar year 2023.
Previous wording
Unrealized depreciation for the three months ended December 31, 2024 primarily resulted from isolated deterioration in credit performance in certain portfolio companies that were on non-accrual status as well as isolated deterioration in the credit performance of a small number of portfolio companies. Unrealized depreciation for the three months ended September 30, 2024 primarily resulted from isolated deterioration in credit performance in certain portfolio companies that were moved to or on non-accrual status. Unrealized depreciation for the three months ended December 31, 2023 primarily resulted from isolated deterioration in the credit performance of a small number of portfolio companies.
Current wording
Unrealized depreciation for the six months ended March 31, 2025 primarily resulted from isolated deterioration in credit performance in (i) a small number of portfolio companies and (ii) portfolio companies that were moved to or on non-accrual status. Unrealized depreciation for the six months ended March 31, 2024 primarily resulted from isolated deterioration in the credit performance of a small number of portfolio companies.
Previous wording
For the three months ended December 31, 2024, we had a realized loss on extinguishment of debt of less than $0.1 million, which represents the unamortized discount on the GBDC 3 2021 Notes assumed as a result on the GBDC 3 Merger, at termination.
Current wording
For the six months ended March 31, 2025, we had a realized loss on extinguishment of debt of less than $0.1 million, which represents the unamortized discount on the GBDC 3 2021 Notes assumed as a result on the GBDC 3 Merger, at termination.
Previous wording
For the three months ended December 31, 2024, we experienced a net decrease in cash and cash equivalents, foreign currencies, restricted cash and cash equivalents and restricted foreign currencies of $136.6 million. During the period, cash used in operating activities was $374.7 million, primarily driven by proceeds from principal payments and sales of portfolio investments of $450.2 million and net investment income after tax of $96.6 million, offset by fundings of portfolio investments of $909.5 million. Lastly, cash provided by financing activities was $238.1 million, primarily driven by borrowings on debt of $3,390.2 million, offset by repayments of debt of $3,037.7 million and distributions paid of $108.3 million.
Current wording
For the six months ended March 31, 2025, we experienced a net decrease in cash and cash equivalents, foreign currencies, restricted cash and cash equivalents and restricted foreign currencies of $111.3 million. During the period, cash used in operating activities was $179.3 million, primarily driven by proceeds from principal payments and sales of portfolio investments of $840.3 million and net investment income after tax of $195.3 million, offset by fundings of portfolio investments of $1,208.0 million. Lastly, cash provided by financing activities was $68.0 million, primarily driven by borrowings on debt of $3,731.4 million and net proceeds from the issuance of common stock through the ATM Program (as defined in Note 11 of our consolidated financial statements) of $37.4 million, offset by repayments of debt of $3,496.1 million and distributions paid of $197.6 million.
Previous wording
For the three months ended December 31, 2023, we experienced a net increase in cash and cash equivalents, foreign currencies, restricted cash and cash equivalents and restricted foreign currencies of $32.8 million. During the period, cash provided by operating activities was $163.6 million, primarily driven by proceeds from principal payments and sales of portfolio investments of $179.4 million and net investment income after excise tax of $83.5 million, offset by fundings of portfolio investments of $73.2 million. Lastly, cash used by financing activities was $130.8 million, primarily driven by repayments of debt of $629.5 million, distributions paid of $59.7 million, offset by borrowings on debt of $563.7 million.
Current wording
For the six months ended March 31, 2024, we experienced a net increase in cash and cash equivalents, foreign currencies, restricted cash and cash equivalents and restricted foreign currencies of $322.0 million. During the period, cash provided by operating activities was $313.0 million, primarily driven by proceeds from principal payments and sales of portfolio investments of $321.3 million and net investment income after excise tax of $170.1 million, offset by fundings of portfolio investments of $147.3 million. Lastly, cash provided by financing activities was $9.0 million, primarily driven by repayments of debt of $999.7 million, distributions paid of $123.6 million, offset by borrowings on debt of $1,145.6 million.
Previous wording
As of December 31, 2024 and September 30, 2024, we had cash and cash equivalents of $103.5 million and $123.1 million, respectively. In addition, we had foreign currencies of $6.8 million and $8.0 million as of December 31, 2024 and September 30, 2024, respectively, restricted cash and cash equivalents of $110.6 million and $227.2 million as of December 31, 2024 and September 30, 2024, respectively. We had restricted foreign currencies of $0.0 million and $1.2 million as of December 31, 2024 and September 30, 2024. Cash and cash equivalents and foreign currencies are available to fund new investments, pay operating expenses and pay distributions. Restricted cash and cash equivalents and restricted foreign currencies can be used to pay principal and interest on borrowings and to fund new investments that meet the guidelines under our debt securitizations or credit facilities, as applicable. As of December 31, 2024 and September 30, 2024, $23.4 million and $136.3 million, respectively, of restricted cash was retained for partial repayments on the notes of certain of our debt securitizations that are past their reinvestment period term.
Current wording
As of March 31, 2025 and September 30, 2024, we had cash and cash equivalents of $103.1 million and $123.1 million, respectively. In addition, we had foreign currencies of $13.8 million and $8.0 million as of March 31, 2025 and September 30, 2024, respectively, restricted cash and cash equivalents of $129.5 million and $227.2 million as of March 31, 2025 and September 30, 2024, respectively. We had restricted foreign currencies of $0.0 million and $1.2 million as of March 31, 2025 and September 30, 2024, respectively. Cash and cash equivalents and foreign currencies are available to fund new investments, pay operating expenses and pay distributions. Restricted cash and cash equivalents and restricted foreign currencies can be used to pay principal and interest on borrowings and to fund new investments that meet the guidelines under our debt securitizations or credit facilities, as applicable. As of March 31, 2025 and September 30, 2024, $29.6 million and $136.3 million, respectively, of restricted cash was retained for partial repayments on the notes of certain of our debt securitizations that are past their reinvestment period term.
Showing the first 40 of 72 pairs. Open the source sections for the rest.
Rearranged current paragraphs (5)
Current report — wording carried from elsewhere
In some cases, our investments provide for deferred interest payments or PIK interest. The principal amount of loans and any accrued but unpaid interest generally become due at the maturity date.
Current report — wording carried from elsewhere
During the six months ended March 31, 2025, we had a net realized loss of $38.9 million primarily attributable to realized losses recognized on the restructuring of debt and equity investments of multiple portfolio company investments and the sale of a portfolio company debt investment that was partially offset by net realized gains recognized on the settlement of forward currency contracts and translation of foreign currency amounts and transactions into U.S. dollars. During the six months ended March 31, 2024, we had a net realized loss of $12.7 million, primarily attributable to the realized losses on the disposition of debt and equity investments of a portfolio company in the second quarter of the 2024 fiscal year that was partially offset by realized gains recognized on the translation of foreign currency amounts and transactions into U.S. dollars and realized gains recognized on the sale of equity investments in multiple portfolio companies.
Current report — wording carried from elsewhere
Unrealized appreciation for the three months ended March 31, 2025 was primarily due to (i) the reversal of previously recognized unrealized depreciation on the restructuring of portfolio company investments, (ii) fair valuing recent originations up to or near par and (iii) improved performance from certain portfolio companies. Unrealized appreciation for the three months ended December 31, 2024 was primarily due to unrealized appreciation resulting from solid borrower credit trends across our portfolio and the reversal of previously recognized unrealized depreciation (i) on the disposition or restructuring of portfolio company investments and (ii) spread tightening in the market during the second half of calendar year 2024. Unrealized depreciation for the three months ended March 31, 2025 and December 31, 2024 primarily resulted from isolated deterioration in credit performance in (i) a small number of portfolio companies and (ii) portfolio companies that were moved to or on non-accrual status.
Current report — wording carried from elsewhere
Class C-R and Subordinated Notes were eliminated in consolidation. As of March 31, 2025, we had outstanding debt under the 2024 Debt Securitization of $1,364.0 million.
Current report — wording carried from elsewhere
•On June 3, 2024, we completed our acquisition of GBDC 3, pursuant to the GBDC 3 Merger Agreement.
Rearranged previous paragraphs (2)
Previous report — wording carried elsewhere
•On June 3, 2024, we completed our acquisition of GBDC 3, pursuant to the GBDC 3 Merger Agreement, GBDC 3 was merged with and into us, with us as the surviving company. As a result of, and as of the effective time of the GBDC 3 Merger, GBDC 3’s separate existence ceased.
Previous report — wording carried elsewhere
GC Advisors also sponsors or manages, and expects in the future to sponsor or manage, other investment funds, accounts or investment vehicles (together referred to as “accounts”) that have investment mandates that are similar, in whole and in part, with ours. For example, GC Advisors presently serves as the investment adviser to Golub Capital Direct Lending Corporation, or GDLC, Golub Capital Direct Lending Unlevered Corporation, or GDLCU,