Barings BDC, Inc. — Third Quarter 2026 Earnings Summary

Financial Performance

• Net investment income was $27.2 million ($0.26 per share) for the three months ended September 30, 2026, compared to $29.0 million ($0.28 per share) in the prior quarter and $33.6 million ($0.32 per share) for the same period in 2025.
• Net realized losses were $4.8 million ($0.05 per share) for the quarter, compared to net realized gains of $18.8 million ($0.18 per share) in the prior quarter and net realized gains of $1.6 million ($0.02 per share) in the prior year quarter.
• Net unrealized appreciation was $2.2 million ($0.02 per share) for the quarter, compared to net unrealized depreciation of $29.4 million ($0.28 per share) in the prior quarter.
• Net increase in net assets resulting from operations was $24.6 million ($0.24 per share) for the quarter, compared to $18.3 million ($0.18 per share) in the prior quarter and $23.6 million ($0.22 per share) in the prior year quarter.
• Total investment income was $64.3 million for the quarter.
• Total operating expenses were $36.4 million for the quarter.
• Investment portfolio at fair value was $2,509.8 million as of September 30, 2026, up from $2,458.6 million as of June 30, 2026.
• Total assets were $2,634.9 million as of September 30, 2026.
• Debt outstanding (principal) was $1,467.2 million as of September 30, 2026, up from $1,409.7 million as of June 30, 2026.
• Total net assets (equity) were $1,143.3 million as of September 30, 2026, down from $1,145.9 million as of June 30, 2026.
• Net asset value (NAV) per share was $10.92 as of September 30, 2026, down $0.02 from the prior quarter.
• Debt-to-equity ratio was 1.28x as of September 30, 2026, compared to 1.23x as of June 30, 2026.
• Net debt-to-equity ratio (adjusted for unrestricted cash and net unsettled transactions) was 1.24x as of September 30, 2026, compared to 1.18x as of June 30, 2026.
• Weighted average yield on debt investments other than non-accrual debt investments was 9.5% as of September 30, 2026, up from 9.4% in the prior quarter.
• 92.8% of the investment portfolio at fair value consisted of floating rate securities as of September 30, 2026.

Guidance and Future Outlook

• Management stated that the company's liquidity position and the breadth of the Barings platform position it well to continue delivering value for shareholders.
• The company intends to use net proceeds from the Barings BDC CLO 2026-1 transaction, together with borrowings under its senior secured credit agreement, to repay in full its $350.0 million of 3.300% notes due November 23, 2026.
• The CLO 2026-1 transaction is expected to close in mid-November 2026, subject to customary closing conditions.

Business Segments and Product Lines

• The company funded $196.0 million of investments during the quarter, including 20 new portfolio companies.
• New portfolio company investments totaled $121.4 million, while additional investments in existing portfolio companies totaled $74.6 million.
• Total investments sold or repaid were $145.9 million, consisting of $66.8 million in loans repaid and $78.5 million in principal payments and sales proceeds.
• The number of portfolio company investments increased to 349 as of September 30, 2026, from 342 as of June 30, 2026.
• Portfolio composition included $1,771.7 million in senior debt and 1st lien notes, $233.3 million in subordinated debt and 2nd lien notes, and $445.0 million in equity shares.
• Subsequent to September 30, 2026, the company made approximately $70.9 million of new commitments, of which $36.2 million closed and funded.
• The subsequent $36.2 million of investments consisted of $35.8 million of first lien senior secured debt investments and $0.4 million of equity investments, with a weighted average yield of 11.1% on the debt investments.
• The company also funded $35.0 million of previously committed revolvers and delayed draw term loans subsequent to the quarter end.

Market and Competitive Landscape

• The company is an externally managed investment company seeking to invest primarily in senior secured loans in middle-market companies.
• The investment adviser, Barings, manages $500 billion in assets firm-wide as of September 30, 2026.
• The company's portfolio is predominantly senior secured, which management cited as a source of stability.

Risks and Challenges

• The press release includes standard forward-looking statement disclaimers noting that actual results may differ materially from plans, estimates, or expectations due to economic, market, or other conditions.
• Risks include the inability of Barings to manage Barings BDC and identify investment opportunities, and the potential for share repurchase plans not to enhance stockholder value.
• Non-GAAP financial measures have limitations and should not be considered in isolation or as a substitute for GAAP financial results.

Management Commentary and Tone

• Thomas McDonnell, Chief Executive Officer, stated that third quarter results reflect the stability of the predominantly senior secured portfolio.
• Management noted that net investment income fully covered the dividend and that NAV per share was largely unchanged.
• Management expressed confidence in the company's liquidity position and the breadth of the Barings platform.

Other Key Points

• The Board declared a quarterly cash dividend of $0.26 per share, payable on December 9, 2026, to shareholders of record on December 2, 2026.
• The company priced Barings BDC CLO 2026-1 on October 30, 2026, an approximately $396.3 million collateralized loan obligation consisting of $304.0 million of rated secured notes and $92.3 million of subordinated notes retained by the Company.
• The floating rate notes in the CLO carry a weighted average interest rate of Term SOFR plus 1.64%.
• The company has a dividend reinvestment plan (DRIP) that automatically reinvests dividends for stockholders who have not opted out.
• A conference call to discuss results is scheduled for November 6, 2026, at 8:30 a.m. ET.