Overview of Nuveen Churchill Direct Lending Corp.

Nuveen Churchill Direct Lending Corp. is a closed-end, externally managed, non-diversified management investment company that has elected to be regulated as a business development company (BDC). The company’s investment objective is to generate attractive risk-adjusted returns primarily through current income by investing primarily in senior secured loans to private equity-owned U.S. middle market companies.

The company has entered into investment advisory and sub-advisory agreements with Churchill DLC Advisor LLC, Churchill Asset Management LLC, and Nuveen Asset Management, LLC to manage its investment portfolio. It has also formed several wholly-owned subsidiaries, including collateralized loan obligation (CLO) vehicles, to facilitate its investment activities.

Financial Performance

For the three months ended March 31, 2025, Nuveen Churchill Direct Lending Corp. reported the following key financial results:

Metric	Q1 2025	Q1 2024
Total Investment Income	$53.6 million	$51.6 million
Net Investment Income	$27.5 million	$29.7 million
Net Realized and Unrealized Gain (Loss) on Investments	$(12.4) million	$0.3 million
Net Increase in Net Assets Resulting from Operations	$15.0 million	$30.0 million

The company’s investment income increased year-over-year, primarily due to growth in the size of its investment portfolio. However, net investment income declined slightly due to higher interest and debt financing expenses, as well as an increase in management and incentive fees. The company also recorded a net unrealized loss on its investments during the quarter, compared to a small gain in the prior year period.

Portfolio Composition and Activity

As of March 31, 2025, Nuveen Churchill Direct Lending Corp.’s investment portfolio had a fair value of $2.08 billion, consisting primarily of first-lien debt (90.5% of the portfolio) and subordinated debt (7.8%). The portfolio included investments in 210 companies across 26 different industries, with the largest investment representing 1.5% of the total portfolio.

During the first quarter of 2025, the company made $166.2 million in new gross commitments and funded $153.0 million in new investments, while $148.4 million in investments were sold or repaid. The weighted average annual interest rate on new debt investments was 9.38%, with floating-rate investments comprising 94.6% of the debt portfolio.

The company’s portfolio companies had a weighted average reported annual EBITDA of $76.3 million, a weighted average interest coverage ratio of 2.36x for first-lien loans, and a weighted average net leverage of 4.92x. Approximately 85% of the debt investments had financial covenants.

Asset Quality and Risk Management

Nuveen Churchill Direct Lending Corp. uses a proprietary investment rating system to monitor the credit profile and expected level of returns on each investment in its portfolio. As of March 31, 2025, the weighted average internal risk rating of the portfolio was 4.14, with 87.8% of the portfolio rated as “Performing - Stable Risk” or better.

There were two investments on non-accrual status as of March 31, 2025, representing 1.03% of the total investment portfolio at amortized cost. The company closely monitors the performance of its portfolio companies and takes proactive steps to manage risk, such as investing in defensive businesses and maintaining strong liquidity.

Liquidity and Capital Resources

Nuveen Churchill Direct Lending Corp. has a diverse capital structure, including asset-based leverage facilities, a revolving credit facility, debt securitizations (CLOs), and an unsecured note issuance. As of March 31, 2025, the company had $172.8 million available under its revolving credit facility and a total debt-to-equity ratio of 0.58x.

The company has also established an at-the-market (ATM) equity offering program, which allows it to issue up to $200 million in common stock. As of March 31, 2025, the company had not issued any shares through the ATM program.

In addition, the company has a share repurchase plan in place, under which it has repurchased $70.6 million in common stock as of March 31, 2025. The company believes that its diverse capital resources and liquidity position provide it with the flexibility to support its near-term capital requirements and investment activities.

Outlook and Risks

The company’s investment portfolio and financial performance are subject to various risks, including changes in trade policies, macroeconomic conditions, and the financial performance of its portfolio companies. While the company is not currently seeing broad-based deterioration in its portfolio, it remains vigilant in monitoring the potential impact of these factors.

Looking ahead, the company believes that lenders with available liquidity and incumbent positions in portfolio companies will benefit from the current market environment, which is characterized by increased refinancing activity. The company also plans to continue focusing on investing in defensive businesses with low cyclicality, strong free cash flow generation, and diversified supply chains.

Overall, Nuveen Churchill Direct Lending Corp. appears to be well-positioned to navigate the current market environment and continue generating attractive risk-adjusted returns for its shareholders. The company’s diversified investment portfolio, robust risk management practices, and flexible capital structure provide a solid foundation for its ongoing operations and future growth.