Kayne Anderson BDC, Inc.

and welcome to Kane Anderson BDC Inc's third quarter 2025 earnings call. The question and answer session will follow the formal presentation. If you would like to ask a question during this time, simply press star followed by the number one on your telephone keypad. If you would like to withdraw your question, press star when again. As a reminder, this conference call is being recorded. It is now my pleasure to turn the conference over to Andy Wedderburn-Maxwell, Senior Vice President.

Good morning and welcome to Kane Anderson BDC Inc's third quarter 2025 earnings call. Today I'm joined by Doug Goodwillie and Ken Leonard, co-CEOs of KBDC, Frank Carl, President, and Terry Hart, CFO. Following our prepared remarks, we will be available to take your questions. Today's call may include forward-looking statements. Such statements involve known and unknown risks, uncertainties, and other factors, and undue reliance should not be placed thereon. These forward-looking statements are not historical facts, but rather are based on current expectations, estimates, and projections about the company, our current and prospective portfolio investments, our industry, our beliefs and opinions, and our assumptions. These statements are not guarantees of future performance and are subject to risks, uncertainties, and other factors, some of which are beyond our control and difficult to predict. Actual results may differ materially from those expressed or forecasted in the forward-looking statements. We ask that you refer to the company's most recent filings with the SEC for important risk factors. Any forward-looking statements made today do not guarantee future performance, and undue reliance should not be placed on them. The company assumes no obligation to update any forward-looking statements at any time. Our earnings release, 10Q, and supplemental earnings presentation are available on the financial section of our website at canebdc.com. Now I'd like to turn the call over to Doug Goodwillie.

Thank you, Andy, and everyone for joining us on the call today. I'll begin by providing a high-level summary of our third quarter performance and share some thoughts on the broader market backdrop, both as it relates to the public market environment and what we're seeing in our private credit market generally. I will also walk through our strategic positioning and provide an update on our capital deployment activities before turning the call over to Frank Karl to go over our portfolio makeup and performance. Finally, Terry Hart will conclude with details on KBDC's financial results. After the close yesterday, we reported another quarter of solid results as we continue to grow our portfolio and execute on our strategy. Net investment income rose 3 cents per share to 43 cents per share representing a 10.5% annualized return on equity, and net income was stable at 35 cents per share. During the quarter, we distributed our 40 cents per share regular dividend, resulting in a dividend coverage ratio of 108%. Our NAV at quarter end was $16.34, a small three-cent decline quarter over quarter, due in large part to a few marks in the portfolio. At quarter end, our estimated spillover net investment income was 16 cents per share. In the quarter, we had 296 million of gross new private credit investments. We funded a total of 274 million, of which 248 million represented new investments and 26 million represented existing previously unfunded commitments. This is an increase of 48% in private credit fundings over Q3 2024 fundings of 185 million. As highlighted on our last earnings call, the pickup and origination activity that we saw towards the end of Q2 has continued through Q3 and into Q4 of 2025. Our average spread on new floating rate loans in the quarter was 568 basis points over SOFR. a 28 basis point improvement over the second quarter. The majority of transactions reviewed in Q3 had spreads over SOFR in the 500 to 600 basis point range. M&A related financings have also become more frequent in Q3 and Q4 as the health of the market improves. We believe that the spread compression that affected the middle market in late 2024 and early 2025 has plateaued. While we are not seeing broad-based spread widening yet, we continue to be pleased with the spread premium that our market broadly and especially our portfolio generates relative to the larger credit markets. Turning to the broader public market environment, BDC share prices saw notable pressure as investors reevaluated their risk appetite over rising concerns regarding the potential pace of dividend rate cuts continued spread compression in certain markets, concerns over credit quality, and the potential negative impact that AI could have over the software sector. These fears have been exacerbated with a few high-profile bankruptcies that touched numerous financial institutions and created splashy headlines regarding systemic risk in the private credit space more broadly. For the sake of clarity, KBDC has no direct or indirect exposure to these situations. I would also like to highlight, unlike most public BDCs, we have no exposure to highly levered financings in the software sector. While public market sentiment is one thing, our perspective of the current credit market landscape tells a different story. One of strong fundamentals and continued resilience in the core middle market. We've been in regular dialogue with our portfolio companies and our underwriting and credit monitoring teams, and we do not see any signs of broad-based stress in our assets. Our portfolio remains high quality, senior secured, and well diversified. Importantly, our non-accrual rate dropped from 1.6% of fair value to 1.4% and remains well below historical averages for the sector. While financial regs regularly comment on the potential for a risk-reward dynamic in private credit, that has become less favorable than in years past, we still see an environment where experienced investors in the middle market can earn near double digit loan level returns for senior debt risk. Said differently, in a world of relative value, we continue to believe that our space offers a compelling value proposition versus other investment asset classes. Turning to a short reminder regarding our positioning and strategy. At KBDC, we've built a portfolio designed to perform across market cycles. With approximately 94% of our investments in first lien senior secured loans, where we are the agent or co-agent 80% of the time, we are structurally well positioned to protect capital and generate consistent income even in uncertain markets. You will note that the percentage of first lien loans has declined from 98% in prior quarters. This is due to our 11% fixed rate investment in the SG credit asset-backed platform. As a reminder, that investment closed in early Q3 and is not included in first lien senior debt. With our strong originations network and ability to underwrite and lead investments, we continue to find attractive deployment opportunities. Most importantly, we remain highly selective when deploying capital, which we think is evident in our portfolio statistics and credit performance. During the third quarter of 2025, repayments of private credit loans totaled 74 million, down from 83 million in the same period of 2024. Consistent with our strategic focus and supported by continued strength in the broadly syndicated loan markets, we further executed on our plan to reduce exposure to lower yielding BSL assets. Specifically, we sold down 113 million of BSL positions in the quarter and have continued this portfolio repositioning. Our goal remains to actively wind down the small remaining BSL portfolio of 67 million and redeploy that capital into higher yielding private credit opportunities in Q4 and potentially into early Q1, 2026. When considering all new fundings and repayments in Q3, net investment activity for the quarter was approximately 87 million. This increase raised our debt to equity ratio to approximately 1.01 times, above our second quarter 2025 debt to equity ratio of 0.91 times. As previously mentioned, our long-term target leverage range is between one to one and a quarter times, so we have some balance sheet capacity there to be able to maximize earnings in future quarters. Lastly, In September, we closed a privately placed offering of 200 million of unsecured notes. Given the strength and the private placement market in Q3, with spreads near their tightest levels compared to the public markets, we felt this was an opportune time to continue to diversify our sources of funding. This will be discussed in the financial results section further. I will now pass the call over to Frank Carl to discuss our portfolio.