Q2 2024 Morgan Stanley Direct Lending Fund Earnings Call Transcript
Key Points
- Morgan Stanley Direct Lending Fund (MSDL) reported a strong second quarter with net asset value per share increasing by $0.16 to $20.83.
- The fund generated net investment income of $0.63 per share, exceeding the regular dividend of $0.50 per share.
- New investment commitments totaled approximately $673.9 million across 46 portfolio companies, showcasing robust portfolio growth.
- MSDL's debt to NAV increased to 0.9 times, with expectations to reach target leverage of 1 to 1.25 in the second half of the year.
- The fund's portfolio is diversified across 34 industries, with nearly 100% of investments in floating rate debt, providing resilience against interest rate fluctuations.
- The fund's debt-to-equity ratio increased from 0.81 times to 0.9 times, indicating higher leverage.
- Total expenses for the second quarter rose to $48.1 million from $44.5 million in the prior quarter.
- The market outlook remains uncertain with potential volatility affecting private credit and LBO activity.
- Repayments and repricings are unpredictable, which could impact future capital deployment strategies.
- There is a high level of portfolio overlap with other large BDCs, which may limit differentiation in investment opportunities.
Welcome to the Morgan Stanley Direct Lending Fund second-quarter 2024 earnings call. (Operator Instructions) As a reminder, this conference call is being recorded.
At this time, I'd like to turn the call over to Mr. Michael Occi, Head of Investor Relations and Chief Administrative Officer. Please go ahead.
Good morning and welcome to Morgan Stanley Direct Lending Fund's second-quarter 2024 earnings call. Joining me are Jeff Levin, President and Chief Executive Officer; David Pessah, Chief Financial Officer; and Rebecca Shaoul, Head of Portfolio Management.
Morgan Stanley Direct Lending Fund's second-quarter 2024 financial results were released yesterday after market close and can be accessed on the Investor Relations section of our website at www.msdl.com. We have arranged for a replay of today's event that will be accessible from the Mortgage Stanley Direct Lending Fund website.
During this
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