Palmer Square Capital BDC Inc. Announces Third Quarter 2025 Financial Results
MISSION WOODS, Kan.--( BUSINESS WIRE)--Palmer Square Capital BDC Inc. (NYSE: PSBD) (“PSBD” or the “Company”), an externally managed business development company, today announced its financial results for the third quarter ended September 30, 2025.
Financial and Operating Highlights
“We are very pleased with our financial performance in the third quarter, supported by our focus on high quality assets and prudent portfolio construction,” said Christopher D. Long, Chairman and Chief Executive Officer of Palmer Square Capital BDC. “Our team is encouraged by the acceleration in deal activity, yet remains committed to disciplined capital deployment with the goal of maximizing long-term value for investors. The depth of our experience across primary and secondary syndicated loan markets, combined with our ability to pursue attractive private credit opportunities, positions us well to take advantage of a dynamic market environment. This agility is further enhanced by our seasoned investment team and strong alignment with shareholders.”
$ in thousands, except per share data
For the Quarter Ended
9/30/25
6/30/25
9/30/2024
Financial Highlights
Net Investment Income Per Share 1
$
0.43
$
0.43
$
0.48
Net Investment Income
$
13,641
$
13,842
$
15,729
NAV Per Share
$
15.39
$
15.68
$
16.61
Dividends Earned Per Share 2
$
0.42
$
0.42
$
0.47
9/30/25
6/30/25
9/30/2024
Portfolio Highlights
Total Fair Value of Investments
$
1,258,988
$
1,279,793
$
1,389,801
Number of Industries
42
39
39
Number of Portfolio Companies
209
206
212
Portfolio Yield 3
10.07
%
10.10
%
10.48
%
Senior Secured Loan 4
95
%
96
%
96
%
Investments on Non-Accrual 5
0.40
%
0.19
%
0.26
%
Total Return 6
1.41
%
1.85
%
1.43
%
Debt-to-Equity
1.53x
1.51x
1.52x
Portfolio and Investment Activity
As of September 30, 2025, we had 262 investments in 209 portfolio companies with an aggregate fair value of approximately $1.2 billion. Based on a total fair value of $1.3 billion, including short term investments, the portfolio consisted of 86.10% first lien senior secured debt investments, 4.90% second lien senior secured debt investments, 4.30% short-term investments, 3.60% collateralized loan obligation structured credit funds (“CLOs”) mezzanine and equity investments, 0.60% corporate bond investments, and 0.50% equity investments.
As of September 30, 2025, 98% of the long-term investments based on fair value in our portfolio were at floating rates. At the end of the third quarter, 99.60% of the portfolio at fair value was income producing. There were two portfolio companies on non-accrual status. As of September 30, 2025, the weighted average total yield to maturity of debt and income producing securities at fair value was 10.07%, and weighted average total yield to maturity of debt and income producing securities at amortized cost was 8.00%. For the third quarter of 2025, the principal amount of new investments funded was $138.7 million which included 28 investments at an average value of approximately $4.8 million. For this period, the Company had $156.0 million aggregate principal amount in sales and repayments.
Liquidity and Capital Resources
As of September 30, 2025, the Company had $4.2 million in cash and cash equivalents and approximately $752.4 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 $252.8 million compared to $16.4 million of unfunded investment commitments as of September 30, 2025.
Recent Developments
On November 05, 2025, PSBD’s Board of Directors announced that it had declared a fourth quarter regular base dividend distribution of $0.36 per share, payable on January 14, 2026, to shareholders of record as of December 29, 2025. We expect to announce an additional quarterly supplemental dividend distribution for the fourth quarter of 2025 in December.
Earnings Conference Call
The Company will host a conference call on Wednesday, November 05, 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:
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 Nine Months Ended
September 30,
2025
2024
Per Common Share Operating Performance
Net Asset Value, Beginning of Period
$
16.50
$
17.04
Results of Operations:
Net Investment Income (1)
1.25
1.48
Net Realized and Unrealized Gain (Loss) on Investments (4)
(1.13
)
(0.48
)
Net Increase (Decrease) in Net Assets Resulting from Operations
0.12
1.00
Distributions to Common Stockholders
Distributions from Net Investment Income
(1.23
)
(1.43
)
Net Decrease in Net Assets Resulting from Distributions
(1.23
)
(1.43
)
Net Asset Value, End of Period
$
15.39
$
16.61
Shares Outstanding, End of Period
31,875,902
32,623,502
Ratio/Supplemental Data
Net assets, end of period
$
490,445,213
$
541,937,155
Weighted-average shares outstanding
32,343,757
32,260,537
Total Return (3)
2.20
%
6.23
%
Portfolio turnover
27
%
23
%
Ratio of operating expenses to average net assets without waiver (2)
13.92
%
14.72
%
Ratio of operating expenses to average net assets with waiver (2)
13.92
%
14.70
%
Ratio of net investment income (loss) to average net assets without waiver (2)
10.38
%
11.54
%
Ratio of net investment income (loss) to average net assets with waiver (2)
10.38
%
11.55
%
Palmer Square Capital BDC Inc.
Consolidated Statement of Assets and Liabilities
September 30,
2025
(Unaudited)
December 31,
2024
Assets:
Non-controlled, non-affiliated investments, at fair value (amortized cost of $1,331,847,439 and $1,454,611,467, respectively)
$
1,258,987,964
$
1,407,130,945
Cash and cash equivalents
4,200,782
2,766,409
Receivables:
Receivable for sales of investments
7,615,716
7,799,523
Receivable for paydowns of investments
1,113,301
1,347,516
Due from investment adviser
616,715
248,110
Dividend receivable
197,582
259,625
Interest receivable
8,682,326
11,458,267
Prepaid expenses and other assets
107,407
32,364
Total Assets
$
1,281,521,793
$
1,431,042,759
Liabilities:
Credit facilities (net of deferred financing costs of $4,191,957 and $5,375,986, respectively) (Note 6)
$
450,064,588
$
501,650,602
Notes (net of deferred financing costs of $1,644,557 and $1,748,822, respectively) (Note 6)
302,285,474
302,505,057
Payables:
Payable for investments purchased
19,973,880
67,460,523
Distributions payable
13,404,534
15,649,925
Management fee payable
2,242,634
2,413,798
Incentive fee payable
1,950,400
2,149,132
Accrued other general and administrative expenses
1,155,070
1,368,753
Total Liabilities
$
791,076,580
$
893,197,790
Commitments and contingencies (Note 9)
Net Assets:
Common Shares, $0.001 par value; 450,000,000 shares authorized; 31,875,902 and 32,600,193 as of September 30, 2025 and December 31, 2024, respectively issued and outstanding
$
31,876
$
32,600
Additional paid-in capital
601,218,336
611,122,164
Total distributable earnings (accumulated deficit)
(110,804,999
)
(73,309,795
)
Total Net Assets
$
490,445,213
$
537,844,969
Total Liabilities and Net Assets
$
1,281,521,793
$
1,431,042,759
Net Asset Value Per Common Share
$
15.39
$
16.50
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 September 30, 2025 and December 31, 2024, the Company had an aggregate of $16.4 million and $21.6 million, respectively, of unfunded commitments to provide debt financing to its portfolio companies. As of each of September 30, 2025 and December 31, 2024, 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 Three Months Ended
September 30,
For the Nine Months Ended
September 30,
2025
2024
2025
2024
Income:
Investment income from non-controlled, non-affiliated investments:
Interest income
$
30,432,071
$
35,775,337
$
90,275,576
$
104,261,540
Dividend income
657,248
599,667
1,713,085
2,659,394
Payment-in-kind interest income
360,941
204,826
1,670,709
439,129
Other income
235,009
726,171
917,098
1,280,377
Total investment income from non-controlled, non-affiliated investments
31,685,269
37,306,001
94,576,468
108,640,440
Total Investment Income
31,685,269
37,306,001
94,576,468
108,640,440
Expenses:
Incentive fees
1,950,400
2,229,576
5,733,185
6,404,282
Interest expense
12,757,494
15,670,636
38,303,625
43,846,496
Management fees
2,242,634
2,424,412
6,809,386
7,290,730
Professional fees
229,116
318,504
793,224
954,527
Directors fees
37,808
37,705
112,192
112,295
Other general and administrative expenses
826,747
896,437
2,429,106
2,277,810
Total Expenses
18,044,199
21,577,270
54,180,718
60,886,140
Less: Management fee waiver (Note 3)
—
—
—
(50,511
)
Net expenses
18,044,199
21,577,270
54,180,718
60,835,629
Net Investment Income (Loss)
13,641,070
15,728,731
40,395,750
47,804,811
Realized and unrealized gains (losses) on investments and foreign currency transactions
Net realized gains (losses):
Non-controlled, non-affiliated investments
(1,243,620
)
(7,119,299
)
(12,883,252
)
(18,267,554
)
Total net realized gains (losses)
(1,243,620
)
(7,119,299
)
(12,883,252
)
(18,267,554
)
Net change in unrealized gains (losses):
Non-controlled, non-affiliated investments
(9,044,026
)
(1,054,247
)
(25,378,309
)
6,210,881
Total net change in unrealized gains (losses)
(9,044,026
)
(1,054,247
)
(25,378,309
)
6,210,881
Total realized and unrealized gains (losses)
(10,287,646
)
(8,173,546
)
(38,261,561
)
(12,056,673
)
Net Increase (Decrease) in Net Assets Resulting from Operations
$
3,353,424
$
7,555,185
$
2,134,189
$
35,748,138
Per Common Share Data:
Basic and diluted net investment income per common share
$
0.43
$
0.48
$
1.25
$
1.48
Basic and diluted net increase (decrease) in net assets resulting from operations
$
0.10
$
0.23
$
0.07
$
1.11
Weighted Average Common Shares Outstanding - Basic and Diluted
32,084,902
32,613,897
32,343,757
32,260,537
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 Three Months Ended September 30,
For the Nine Months Ended September 30,
2025
2024
2025
2024
New investments:
Gross investments
$
138,665,631
$
66,239,961
$
335,350,462
$
602,024,188
Less: sold investments
(156,027,427
)
(82,822,220
)
(433,678,517
)
(292,405,569
)
Total new investments
(17,361,796
)
(16,582,259
)
(98,328,055
)
309,618,619
Principal amount of investments funded:
First-lien senior secured debt investments
$
121,385,632
$
62,171,592
$
303,546,402
$
526,804,513
Second-lien senior secured debt investments
5,970,000
4,068,369
10,960,000
46,292,869
Corporate bonds
2,999,999
—
4,998,572
4,095,000
Collateralized securities and structured products - debt
8,310,000
—
8,310,000
23,573,612
CLO Equity
—
—
—
—
Common stock
—
—
6,937,015
1,258,194
Preferred Stock
—
—
598,473
—
Total principal amount of investments funded
138,665,631
66,239,961
335,350,462
602,024,188
Principal amount of investments sold or repaid:
First-lien senior secured debt investments
$
140,963,220
$
75,231,088
$
404,445,897
$
253,203,637
Second-lien senior secured debt investments
7,499,999
1,200,000
15,736,494
19,654,359
Corporate Bonds
—
4,020,000
2,005,000
4,020,000
Collateralized securities and structured products - debt
5,900,000
1,250,000
8,800,000
6,500,000
CLO Equity
1,664,208
1,121,132
2,691,126
9,027,573
Common Stock
—
—
—
—
Preferred Stock
—
—
—
—
Total principal amount of investments sold or repaid
$
156,027,427
$
82,822,220
$
433,678,517
$
292,405,569
For the Three Months
Ended September 30,
For the Nine Months
Ended September 30,
2025
2024
2025
2024
Number of new investment commitments
28
21
69
78
Average new investment commitment amount
$
4,760,375
$
2,717,288
$
4,182,689
$
4,157,481
Weighted average maturity for new investment commitments
6.75 years
5.29 years
5.80 years
5.60 years
Percentage of new debt investment commitments at floating rates
97.75
%
100.00
%
98.96
%
100.00
%
Percentage of new debt investment commitments at fixed rates
2.25
%
0.00
%
1.04
%
0.00
%
Weighted average interest rate of new investment commitments (1)
8.48
%
9.07
%
8.54
%
9.58
%
Weighted average spread over reference rate of new floating rate investment commitments (2)
4.30
%
4.17
%
4.32
%
4.63
%
Weighted average interest rate on long-term investments sold or paid down
8.64
%
9.50
%
8.53
%
10.22
%