Goldman Sachs BDC, Inc.

Austin Neary Good morning. This is Austin Neary, a member of the Investor Relations Team for Goldman Sachs BDC, Inc. I would like to welcome everyone to the Goldman Sachs BDC, Inc. Third Quarter 2024 Earnings Conference Call. Please note that all participants will be in listener-only mode until the end of the call, when we will open up the line for questions. Before we begin today's call, I would like to remind our listeners that today's remarks may include forward-looking statements. These statements represent the company's belief regarding future events that, by their nature, are uncertain and outside of the company's control. The company's actual results and financial condition may differ, possibly materially, from what is indicated in those forward-looking statements as a result of a number of factors, including those described from time to time in the company's SEC filings. This audio cast is copyrighted material of Goldman Sachs BDC, Inc. and may not be duplicated, reproduced, or rebroadcast without our consent. Yesterday, after the market closed, the company issued an earnings press release and posted a supplemental earnings presentation, both of which can be found on the homepage of our website at www.GoldmanSachsBDC.com under the Investor Resources section, and which include reconciliations of non-GAAP measures to the most directly comparable GAAP measures. These documents should be reviewed in conjunction with the company's quarterly report on Form 10-Q filed yesterday with the SEC. This conference call is being recorded today, Friday, November 8th, 2024, for replay purposes. I'll now turn the call over to Alex Chee, Co-Chief Executive Officer of Goldman Sachs BDC, Inc.

Thank you, Austin. Good morning, everyone, and thank you for joining us for our third quarter 2024 earnings conference call. I'm here today with David Miller, our Co-Chief Executive Officer, Tucker Green, our Chief Operating Officer, and Stan Medeshevsky, our Chief Financial Officer. I'll begin the call by providing a brief overview of our third quarter results and then discuss the current market environment in more detail. I'll then turn the call over to David and Tucker to describe our portfolio activity and performance before handing it off to Stan to take us through our financial results. And then finally, we'll open the line for Q&A. With that, let's get to our third quarter results. Our net investment income per share for the quarter was 58 cents and net asset value per share was $13.54 a decrease of approximately 1% relative to the second quarter NAV, which was largely due to net realized and unrealized losses in the quarter. As we announced after market close yesterday, our board declared a fourth quarter dividend of 45 cents per share payable to shareholders of record as of December 31st, 2024. This marks the company's 39th consecutive quarter of a 45 cent per share dividend totaling $17.55 per share since our IPO, excluding the special dividends we paid in 2021 following the merger with MMLC. Now, with respect to broader market conditions, M&A continued to recover in the third quarter with growth of 17.5% year-over-year in sponsor M&A volumes. We noted earlier in the year that we anticipated a rebound in sponsor M&A driven by the $1.4 trillion of private equity dry powder and the DPI pressure that private equity firms were facing to return capital to LP investors. We saw these factors drive higher activity in the second and third quarter, and although we expect the fourth quarter to be somewhat muted as market participants took a pause given the election, we anticipate that this dynamic will continue to enhance M&A volumes in 2025. GSBD has certainly benefited from this overall trend, which was further enhanced by our platform capabilities. Our third quarter gross originations more than doubled year over year, and it's the second largest deployment quarter since the integration of GSBD into the broader Goldman Sachs private credit platform, with the highest being this past second quarter of 2024. We continue to originate new investments with sound credit fundamentals and low LTVs. Finally, our sales and repayments activity increased 45% from the prior quarter, totaling $329 million. we're focused on harvesting older vintage investments and recycling into new originations. To that end, 72% of our payments were 2021 and older vintages. Our recycling efforts are enhanced by our proactive portfolio management and the breadth of our private credit platform to consistently originate new and attractive investment opportunities. With that, let me turn it over to my co-CEO, David Miller.

Thanks, Alex. During the quarter, we originated at approximately 376.6 million in 34 new investment commitments comprised of 15 new and 19 existing portfolio companies. As Alex mentioned, this was indeed the second highest level of quarterly originations for GSBD since the integration of our platform in early 2022. 98.1% of our originations were in first lien loans. which continues to reflect our bias at primarily maintaining exposure to investments that are higher up in the capital structure. Sales and repayment activity totaled 329.1 million, primarily driven by the repayment and refinancing of our investments in 10 portfolio companies. During the quarter, we also selectively sold names in the portfolio with majority at or above their mark. When we received an attractive bid, and sought to rotate out of legacy names, all with a focus on recycling the book into new originations. As the portfolio continues to turnover, we will lean into our position within the Goldman Sachs ecosystem for what we believe should be a rebound in M&A activity volume into 2025. Turning to portfolio composition. As of September 30, 2024, total investments in our portfolio were $3.44 billion at fair value. comprised of 97.6% in senior secured loans, including 91.6% in first lien, 4.7% in first lien last out unit tranche, and 1.3% in second lien debt, as well as a negligible amount of unsecured debt, and 1.9% in a combination of preferred and common stock. With that, let me turn it over to our Chief Operating Officer, Tucker Green, to discuss new investments this quarter and our overall credit quality.