PSBD Palmer Square Capital BDC Inc

Declares First Quarter 2025 Base Dividend of $0.36 Per Share with Supplemental Dividend Expected to be Announced in March

Palmer Square Capital BDC Inc. (NYSE: PSBD) (“PSBD” or the “Company”), an externally managed business development company, today announced its financial results for the fourth quarter and full year ended December 31, 2024.

Financial and Operating Highlights

• Total investment income of $34.9 million for the fourth quarter of 2024, compared to $29.8 million for the prior year period
• Net investment income of $14.8 million or $0.45 per share for the fourth quarter of 2024, as compared to $15.4 million or $0.58 per share for the comparable period last year
• Net asset value of $16.50 per share as of December 31, 2024, compared to $16.61 per share as of September 30, 2024
• Total net realized and unrealized losses of $2.9 million for the fourth quarter of 2024, compared to gains of $6.6 million in the fourth quarter of 2023
• As of December 31, 2024, total assets were $1.4 billion and total net assets were $537.8 million
• Debt-to-equity as of December 31, 2024 was 1.50x, compared to 1.52x as of September 30, 2024
• Paid cash distributions to stockholders totaling $0.48 per share for the fourth quarter of 2024
• Declared a first quarter regular base dividend distribution of $0.36 per share payable on April 10, 2025, to shareholders of record as of March 28, 2025. In accordance with our dividend policy, we expect to announce a supplemental dividend in March
• In the fourth quarter, we had only $685 thousand of PIK income, or 1.96% of total investment income

“In 2024, Palmer Square Capital BDC drove strong financial performance through its differentiated portfolio strategy composed of both liquid and private credit investments,” said Christopher D. Long, Chairman and Chief Executive Officer of PSBD. “Against a market backdrop characterized by ongoing rate uncertainty and tightening credit spreads, we grew our portfolio of broadly syndicated public debt and large private credit borrowers in a disciplined, credit-specific fashion. Looking ahead, we believe the PSBD portfolio will continue to deliver attractive returns while maintaining exceptional credit quality.”

$ in thousands, except per share data

 

 

For the Quarter Ended

 

 

 

12/31/24

 

9/30/24

 

12/31/23

 

Financial Highlights

 

 

 

 

 

 

 

 

 

 

Net Investment Income Per Share1

 

$

0.45

 

$

0.48

 

$

0.58

 

Net Investment Income

 

$

14,796

 

$

15,729

 

$

15,391

 

NAV Per Share

 

$

16.50

 

$

16.61

 

$

17.04

 

Dividends Earned Per Share2

 

$

0.48

 

$

0.47

 

$

0.54

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

12/31/24

 

 

9/30/24

 

 

12/31/23

 

Portfolio Highlights

 

 

 

 

 

 

 

 

 

 

Total Fair Value of Investments

 

$

1,407,131

 

$

1,389,801

 

$

1,108,811

 

Number of Industries

 

 

38

 

 

39

 

 

38

 

Number of Portfolio Companies

 

 

207

 

 

212

 

 

191

 

Portfolio Yield3

 

 

10.65%

 

 

10.48%

 

 

10.51%

 

Senior Secured Loan4

 

 

96%

 

 

96%

 

 

96%

 

Investments on Non-Accrual5

 

 

0.08%

 

 

0.26%

 

 

0.00%

 

Total Return6

 

 

2.36%

 

 

1.43%

 

 

4.88%

 

Debt-to-Equity

 

 

1.50x

 

 

1.52x

 

 

1.39x

 

1.

 

Net investment income for the period divided by the weighted average share count for the period.

2.

 

Dividend amount reflects dividend earned in period.

3.

 

Weighted average total yield of debt and income producing securities at fair value.

4.

 

As a percentage of long-term investments, at fair value.

5.

 

As a percentage of total investments, at fair value.

6.

 

Total return is calculated as the change in net asset value (“NAV”) per share during the period, plus distributions per share (if any), divided by the beginning NAV per share. Total return is not annualized. Assumes reinvestment of distributions.

Portfolio and Investment Activity

As of December 31, 2024, we had 262 investments in 207 portfolio companies with an aggregate fair value of approximately $1.3 billion. Based on a total fair value of $1.4 billion, including short term investments, the portfolio consisted of 85.7% first lien senior secured debt investments, 5.5% second lien senior secured debt investments, 4.9% short-term investments, 3.4% collateralized loan obligation structured credit funds (“CLOs”) mezzanine and equity investments, 0.3% corporate bond investments, and 0.1% equity investments.

As of December 31, 2024, 99% of the long-term investments based on fair value in our portfolio were at floating rates. At the end of the fourth quarter, 99.92% of the portfolio at fair value was income producing. There were two loans on non-accrual status. As of December 31, 2024, the weighted average total yield to maturity of debt and income producing securities at fair value was 10.65%, and weighted average total yield to maturity of debt and income producing securities at amortized cost was 9.06%. For the fourth quarter of 2024, the principal amount of new investments funded was $171.8 million which included 28 investments at an average value of approximately $4.5 million. For this period, the Company had $176.4 million aggregate principal amount in sales and repayments.

Liquidity and Capital Resources

As of December 31, 2024, the Company had $2.8 million in cash and cash equivalents and approximately $804.2 million in total aggregate principal amount of debt outstanding. Subject to borrowing base and other restrictions, the Company had available liquidity, consisting of cash and undrawn capacity on credit facilities of approximately $199.7 million compared to $21.6 million of undrawn investment commitments as of December 31, 2024.

Recent Developments

On February 27, 2025, PSBD’s Board of Directors announced that it had declared a first quarter regular base dividend distribution of $0.36 per share payable on April 10, 2025, to shareholders of record as of March 28, 2024. We expect to announce an additional quarterly supplemental dividend distribution for the first quarter of 2025 in March.

Earnings Conference Call

The Company will host a conference call on Thursday, February 27, 2025, at 1:00 pm ET to review its financial performance and conduct a question-and-answer session. To participate in the earnings call, participants should register online at the Palmer Square Investor Relations website. To avoid potential delays, please join at least 10 minutes prior to the start of the call. The conference call can be accessed through the following links:

• United States: +1 (888) 596-4144
• International: +1 (646) 968-2525
• Event Plus Entry Passcode: 1803382#
• Live Audio Webcast

A replay of the live conference call will be available shortly after the conclusion of the event and accessible on the events and presentations section of the Palmer Square Investor Relations website.

About Palmer Square Capital BDC Inc.

Palmer Square Capital BDC Inc. (NYSE: PSBD) is an externally managed, non-diversified closed-end management investment company that primarily lends to and invests in corporate debt loans, including but not limited to large private U.S. companies in the broadly syndicated loan market, as well as the direct large cap private credit market. PSBD has elected to be regulated as a business development company under the Investment Company Act of 1940. PSBD’s investment objective is to maximize total return, comprised of current income and capital appreciation. PSBD’s current investment focus is guided by two strategies that facilitate its investment opportunities and core competencies: (1) investing in corporate debt loans and, to a lesser extent, (2) investing in other debt securities which may include collateralized loan obligation debt and equity. PSBD’s investment activities are managed by its investment adviser, Palmer Square BDC Advisor LLC, an affiliate of Palmer Square Capital Management LLC.

Forward-Looking Statements

Statements other than statements of historical facts included in this press release may constitute forward-looking statements and are not guarantees of future performance or results and involve a number of risks and uncertainties. The forward-looking statements may include statements as to our future base and supplemental dividend distributions and the prospects of our portfolio companies. These and other forward-looking statements can be identified by the use of forward-looking terminology such as “may,” “will,” “should,” “seek,” “expect,” “anticipate,” “project,” “estimate,” “intend,” “continue,” “target,” or “believe” or the negatives thereof or other variations thereon or comparable terminology. Actual results may differ materially from those in the forward-looking statements as a result of a number of factors, including those described from time to time in PSBD’s filings with the SEC. PSBD undertakes no duty to update any forward-looking statement made herein unless required by law. All forward-looking statements speak only as of the date of this press release. Although PSBD undertakes no obligation to revise or update any forward-looking statements, whether as a result of new information, future events or otherwise, you are advised to consult any additional disclosures that PSBD may make directly to you or through reports that in the future may be filed with the SEC, including annual reports on Form 10-K, quarterly reports on Form 10-Q and current reports on Form 8-K.

Financial Highlights

 

 

 

 

 

 

 

 

 

 

For the Period January 23, 2020 (Commencement of Operations) through

 

 

For the Year Ended December 31,

 

December 31,

 

 

2024

 

2023

 

2022

 

2021

 

2020

Per Common Share Operating Performance

 

 

 

 

 

 

 

 

 

 

Net Asset Value, Beginning of Period

 

$17.04

 

$14.96

 

$20.06

 

$20.15

 

$20.00

 

 

 

 

 

 

 

 

 

 

 

Results of Operations:

 

 

 

 

 

 

 

 

 

 

Net Investment Income(1)

 

1.93

 

2.26

 

1.78

 

1.47

 

1.32

Net Realized and Unrealized Gain (Loss) on Investments(4)

 

(0.56)

 

1.98

 

(5.00)

 

(0.18)

 

(0.19)

Net Increase (Decrease) in Net Assets Resulting from Operations

 

1.37

 

4.24

 

(3.22)

 

1.29

 

1.13

 

 

 

 

 

 

 

 

 

 

 

Distributions to Common Stockholders

 

 

 

 

 

 

 

 

 

 

Distributions from Net Investment Income

 

(1.91)

 

(2.16)

 

(1.85)

 

(1.01)

 

(0.98)

Distributions from Realized Gains

 

-

 

-

 

(0.03)

 

(0.37)

 

-

Net Decrease in Net Assets Resulting from Distributions

 

(1.91)

 

(2.16)

 

(1.88)

 

(1.38)

 

(0.98)

 

 

 

 

 

 

 

 

 

 

 

Net Asset Value, End of Period

 

$16.50

 

$17.04

 

$14.96

 

$20.06

 

$20.15

 

 

 

 

 

 

 

 

 

 

 

Shares Outstanding, End of Period

 

32,600,193

 

27,102,794

 

24,286,628

 

22,750,331

 

12,562,805

 

 

 

 

 

 

 

 

 

 

 

Ratio/Supplemental Data

 

 

 

 

 

 

 

 

 

 

Net assets, end of period

 

$537,844,969

 

$461,955,393

 

$363,443,482

 

$452,797,588

 

$253,144,971

Weighted-average shares outstanding

 

32,353,615

 

25,700,603

 

23,130,666

 

15,494,614

 

11,156,932

Total Return(3)

 

8.74%

 

29.21%

 

(16.51)%

 

8.10%

 

4.29%

Portfolio turnover

 

36%

 

25%

 

27%

 

53%

 

63%

Ratio of operating expenses to average net assets without waiver(2)

 

14.68%

 

13.15%

 

8.28%

 

5.54%

 

5.69%

Ratio of operating expenses to average net assets with waiver(2)

 

14.67%

 

12.90%

 

8.03%

 

5.29%

 

5.44%

Ratio of net investment income (loss) to average net assets without waiver(2)

 

11.34%

 

13.54%

 

9.61%

 

6.92%

 

7.18%

Ratio of net investment income (loss) to average net assets with waiver(2)

 

11.35%

 

13.79%

 

9.86%

 

7.17%

 

7.43%

1.

 

The per common share data was derived by using weighted average shares outstanding.

2.

 

The ratios reflect an annualized amount.

3.

 

Total return is calculated as the change in net asset value (“NAV”) per share during the period, plus distributions per share (if any), divided by the beginning NAV per share. Total return is not annualized. Assumes reinvestment of distributions.

4.

 

Realized and unrealized gains and losses per share in this caption are balancing amounts necessary to reconcile the change in net asset value per share for the period, and may not reconcile with the aggregate gains and losses in the Consolidated Statements of Operations due to share transactions during the period.

Palmer Square Capital BDC Inc.

Consolidated Statement of Assets and Liabilities

 

 

 

December 31,

2024

 

 

December 31,

2023

 

Assets:

 

 

 

 

 

 

Non-controlled, non-affiliated investments, at fair value (amortized cost of $1,454,611,467 and $1,159,135,422, respectively)

 

$

1,407,130,945

 

 

$

1,108,810,753

 

Cash and cash equivalents

 

 

2,766,409

 

 

 

2,117,109

 

Receivables:

 

 

 

 

 

 

Receivable for sales of investments

 

 

7,799,523

 

 

 

97,141

 

Receivable for paydowns of investments

 

 

1,347,516

 

 

 

344,509

 

Due from investment adviser

 

 

248,110

 

 

 

1,718,960

 

Dividend receivable

 

 

259,625

 

 

 

301,637

 

Interest receivable

 

 

11,458,267

 

 

 

8,394,509

 

Prepaid expenses and other assets

 

 

32,364

 

 

 

30,100

 

Total Assets

 

$

1,431,042,759

 

 

$

1,121,814,718

 

 

 

 

 

 

 

 

Liabilities:

 

 

 

 

 

 

Credit facilities (net of deferred financing costs of $5,375,986 and $3,211,510, respectively) (Note 6)

 

$

501,650,602

 

 

$

641,828,805

 

Notes (net of deferred financing costs of $1,748,822) (Note 6)

 

 

302,505,057

 

 

 

-

 

Payables:

 

 

 

 

 

 

Payable for investments purchased

 

 

67,460,523

 

 

 

14,710,524

 

Distributions payable

 

 

15,649,925

 

 

 

-

 

Management fee payable

 

 

2,413,798

 

 

 

2,252,075

 

Incentive fee payable

 

 

2,149,132

 

 

 

-

 

Accrued other general and administrative expenses

 

 

1,368,753

 

 

 

1,067,921

 

Total Liabilities

 

$

893,197,790

 

 

$

659,859,325

 

 

 

 

 

 

 

 

Commitments and contingencies (Note 9)

 

 

 

 

 

 

 

 

 

 

 

 

 

Net Assets:

 

 

 

 

 

 

Common Shares, $0.001 par value; 450,000,000 shares authorized; 32,600,193 and 27,102,794 as of December 31, 2024 and December 31, 2023, respectively issued and outstanding

 

$

32,600

 

 

$

27,103

 

Additional paid-in capital

 

 

611,122,164

 

 

 

520,663,106

 

Total distributable earnings (accumulated deficit)

 

 

(73,309,795

)

 

 

(58,734,816

)

Total Net Assets

 

$

537,844,969

 

 

$

461,955,393

 

Total Liabilities and Net Assets

 

$

1,431,042,759

 

 

$

1,121,814,718

 

Net Asset Value Per Common Share

 

$

16.50

 

 

$

17.04

 

The accompanying notes are an integral part of these consolidated financial statements.

 

(Note 6)

 

See Note 6 to the consolidated financial statements for a description of the Company’s borrowings, including its revolving credit facility with Bank of America, N.A., its credit facility with Wells Fargo Bank, National Association, and its term debt securitization (CLO transaction).

(Note 9)

 

As of December 31, 2024 and December 31, 2023, the Company had an aggregate of $21.6 million and $20.1 million, respectively, of unfunded commitments to provide debt financing to its portfolio companies. As of each of December 31, 2024 and December 31, 2023, there were no capital calls or draw requests made by the portfolio companies to fund these commitments. Such commitments are generally up to the Company’s discretion to approve or are subject to the satisfaction of certain financial and nonfinancial covenants and involve, to varying degrees, elements of credit risk in excess of the amount recognized in the Company’s consolidated statements of assets and liabilities and are not reflected in the Company’s consolidated statements of assets and liabilities.

Palmer Square Capital BDC Inc.

Consolidated Statement of Operations

 

 

 

For the Year Ended December 31,

 

 

 

2024

 

 

2023

 

 

2022

 

Income:

 

 

 

 

 

 

 

 

 

Investment income from non-controlled, non-affiliated investments:

 

 

 

 

 

 

 

 

 

Interest income

 

$

137,508,964

 

 

$

107,739,382

 

 

$

73,705,450

 

Dividend income

 

 

3,315,849

 

 

 

4,066,745

 

 

 

610,203

 

Payment-in-kind interest income

 

 

1,123,611

 

 

 

-

 

 

 

-

 

Other income

 

 

1,564,875

 

 

 

417,480

 

 

 

184,247

 

Total investment income from non-controlled, non-affiliated investments

 

 

143,513,299

 

 

 

112,223,607

 

 

 

74,499,900

 

Total Investment Income

 

 

143,513,299

 

 

 

112,223,607

 

 

 

74,499,900

 

 

 

 

 

 

 

 

 

 

 

Expenses:

 

 

 

 

 

 

 

 

 

Incentive fees

 

 

8,553,414

 

 

 

-

 

 

 

-

 

Interest expense

 

 

58,006,112

 

 

 

44,483,152

 

 

 

23,452,169

 

Management fees

 

 

9,704,528

 

 

 

8,408,074

 

 

 

8,328,713

 

Professional fees

 

 

1,451,419

 

 

 

792,645

 

 

 

741,961

 

Directors fees

 

 

150,000

 

 

 

75,000

 

 

 

75,000

 

Other general and administrative expenses

 

 

3,097,955

 

 

 

1,528,225

 

 

 

1,862,314

 

Total Expenses

 

 

80,963,428

 

 

 

55,287,096

 

 

 

34,460,157

 

Less: Management fee waiver (Note 3)

 

 

(50,511

)

 

 

(1,051,009

)

 

 

(1,041,089

)

Net expenses

 

 

80,912,917

 

 

 

54,236,087

 

 

 

33,419,068

 

Net Investment Income (Loss)

 

 

62,600,382

 

 

 

57,987,520

 

 

 

41,080,832

 

 

 

 

 

 

 

 

 

 

 

Realized and unrealized gains (losses) on investments and foreign currency transactions

 

 

 

 

 

 

 

 

 

Net realized gains (losses):

 

 

 

 

 

 

 

 

 

Non-controlled, non-affiliated investments

 

 

(17,778,119

)

 

 

(2,715,413

)

 

 

(8,130,187

)

Total net realized gains (losses)

 

 

(17,778,119

)

 

 

(2,715,413

)

 

 

(8,130,187

)

Net change in unrealized gains (losses):

 

 

 

 

 

 

 

 

 

Non-controlled, non-affiliated investments

 

 

2,843,502

 

 

 

52,563,544

 

 

 

(107,432,980

)

Total net change in unrealized gains (losses)

 

 

2,843,502

 

 

 

52,563,544

 

 

 

(107,432,980

)

Total realized and unrealized gains (losses)

 

 

(14,934,617

)

 

 

49,848,131

 

 

 

(115,563,167

)

 

 

 

 

 

 

 

 

 

 

Net Increase (Decrease) in Net Assets Resulting from Operations

 

$

47,665,765

 

 

$

107,835,651

 

 

$

(74,482,335

)

 

 

 

 

 

 

 

 

 

 

Per Common Share Data:

 

 

 

 

 

 

 

 

 

Basic and diluted net investment income per common share

 

$

1.93

 

 

$

2.26

 

 

$

1.78

 

Basic and diluted net increase (decrease) in net assets resulting from operations

 

$

1.47

 

 

$

4.20

 

 

$

(3.22

)

Weighted Average Common Shares Outstanding - Basic and Diluted

 

 

32,353,615

 

 

 

25,700,603

 

 

 

23,130,666

 

The accompanying notes are an integral part of these consolidated financial statements.

 

(Note 3)

 

Prior to the IPO, the base management fee was 2.00% of the average value of the weighted average (based on the number of shares outstanding each day in the quarter) of the Company’s total net assets at the end of the two most recently completed calendar quarters. The Investment Advisor, however, during any period prior to the IPO, agreed to waive its right to receive management fees in excess of an annual rate of 1.75% of the average value of the weighted average total net assets at the end of each of our two most recently completed calendar quarters. The Investment Advisor will not be permitted to recoup any base management fees waived for any period of time prior to the IPO.

Palmer Square Capital BDC Inc.

Portfolio and Investment Activity

 

 

 

For the Year Ended December 31,

 

 

 

2024

 

 

2023

 

 

2022

 

New investments:

 

 

 

 

 

 

 

 

 

Gross investments

 

$

773,809,544

 

 

$

273,733,424

 

 

$

278,951,054

 

Less: sold investments

 

 

(468,762,595

)

 

 

(247,083,117

)

 

 

(314,355,643

)

Total new investments

 

 

305,046,949

 

 

 

26,650,307

 

 

 

(35,404,589

)

 

 

 

 

 

 

 

 

 

 

Principal amount of investments funded:

 

 

 

 

 

 

 

 

 

First-lien senior secured debt investments

 

$

687,351,131

 

 

$

267,272,174

 

 

$

247,233,397

 

Second-lien senior secured debt investments

 

 

46,287,869

 

 

 

3,858,750

 

 

 

19,102,118

 

Corporate bonds

 

 

4,095,000

 

 

 

2,602,500

 

 

 

-

 

Convertible bonds

 

 

-

 

 

 

-

 

 

 

3,728,288

 

Collateralized securities and structured products - debt

 

 

34,817,350

 

 

 

-

 

 

 

-

 

CLO Equity

 

 

-

 

 

 

-

 

 

 

8,887,251

 

Common stock

 

 

1,258,194

 

 

 

-

 

 

 

-

 

Total principal amount of investments funded

 

 

773,809,544

 

 

 

273,733,424

 

 

 

278,951,054

 

 

 

 

 

 

 

 

 

 

 

Principal amount of investments sold or repaid:

 

 

 

 

 

 

 

 

 

First-lien senior secured debt investments

 

$

416,686,491

 

 

$

233,535,659

 

 

$

292,852,517

 

Second-lien senior secured debt investments

 

 

24,881,614

 

 

 

8,013,549

 

 

 

11,938,325

 

Corporate Bonds

 

 

4,020,000

 

 

 

-

 

 

 

987,500

 

Convertible bonds

 

 

-

 

 

 

-

 

 

 

4,504,808

 

CLO Equity

 

 

11,174,490

 

 

 

2,533,909

 

 

 

1,976,080

 

Collateralized securities and structured products - debt

 

 

12,000,000

 

 

 

3,000,000

 

 

 

1,501,875

 

Common Stock

 

 

-

 

 

 

-

 

 

 

594,538

 

Total principal amount of investments sold or repaid

 

$

468,762,595

 

 

 

247,083,117

 

 

 

314,355,643

 

 

 

For the Year Ended December 31,

 

 

 

2024

 

 

2023

 

 

2022

 

Number of new investment commitments

 

 

94

 

 

 

67

 

 

 

38

 

Average new investment commitment amount

 

$

4,419,385

 

 

$

3,802,624

 

 

$

4,784,093

 

Weighted average maturity for new investment commitments

 

5.6 years

 

 

5.19 years

 

 

5.95 years

 

Percentage of new debt investment commitments at floating rates

 

 

100.00

%

 

 

98.82

%

 

 

100.00

%

Percentage of new debt investment commitments at fixed rates

 

 

0.00

%

 

 

1.18

%

 

 

0.00

%

Weighted average interest rate of new investment commitments(1)

 

 

9.12

%

 

 

10.22

%

 

 

9.17

%

Weighted average spread over reference rate of new floating rate investment commitments(2)

 

 

4.62

%

 

 

4.87

%

 

 

4.80

%

Weighted average interest rate on long-term investments sold or paid down

 

 

9.68

%

 

 

9.56

%

 

 

5.45

%

1.

 

New CLO equity investments do not have an ascribed interest rate and are therefore excluded from the calculation.

2.

 

Variable rate loans bear interest at a rate that may be determined by reference to either a) LIBOR (which can include one-, two-, three- or six-month LIBOR) or b) the CME Term Secured Overnight Financing Rate (“SOFR” or “S”) (which can include one-, three-, or six-month SOFR), which resets periodically based on the terms of the loan agreement. At the borrower’s option, loans may instead reference an alternate base rate (which can include the Federal Funds Effective Rate or the Prime Rate), which also resets periodically based on the terms of the loan agreements. Loans that reference SOFR may include a Credit Spread Adjustment (“CSA”), where the CSA is a defined additional spread amount based on the tenor of SOFR the borrower selects (making the reference rate S+CSA).

 

View source version on businesswire.com: https://www.businesswire.com/news/home/20250226374735/en/

Investors Matt Bloomfield and Jeremy Goff Palmer Square Capital BDC Inc. Investors@palmersquarebdc.com

Media Josh Clarkson Prosek Partners PSBD@prosek.com