HIGHLIGHTSQuarter ended December 31, 2025 (Unaudited)($ in millions, except per share amounts)
Assets and Liabilities:
Investment portfolio (1)(2)
$
2,605.3
Net assets
$
1,040.4
Net asset value per share
$
10.49
Quarterly change in net asset value per share
(3.1
)%
Credit Facility
$
488.9
2026 Notes, net of unamortized deferred financing costs
$
184.8
2036 Asset-Backed Debt, net of unamortized deferred financing costs
$
284.8
2036-R Asset-Backed Debt, net of unamortized deferred financing costs
$
286.6
2037 Asset-Backed Debt, net of unamortized deferred financing costs
$
387.0
Debt to equity
1.57x
Weighted average yield on debt investments at quarter-end
9.9
%
Operating Results:
Net investment income
$
26.6
Net investment income per share (GAAP)
$
0.27
Core net investment income per share (3)
$
0.27
Distributions declared per share
$
0.31
Portfolio Activity:
Purchases of investments
$
301.0
Sales and repayments of investments
$
441.4
PSSL Portfolio data:
PSSL investment portfolio
$
1,195.0
Purchases of investments
$
133.8
Sales and repayments of investments
$
12.4
PSSL II Portfolio data:
PSSL II investment portfolio
$
193.2
Purchases of investments
$
196.5
Sales and repayments of investments
$
2.9
(1)
Includes investments in PennantPark Senior Secured Loan Fund I LLC, or PSSL, an unconsolidated joint venture, totaling $310.3 million, at fair value.
(2)
Includes investments in PennatPark Senior Secured Loan Fund II LLC, or PSSL II, an unconsolidated joint venture, totaling $56.2 million, at fair value.
(3)
Core net investment income ("Core NII") is a non-GAAP financial measure. The Company believes that Core NII provides useful information to investors and management because it reflects the Company's financial performance excluding one-time or non-recurring investment income and expenses. The presentation of this additional information is not meant to be considered in isolation or as a substitute for financial results prepared in accordance with GAAP. For the quarter ended December 31, 2025, Core NII excluded: i) $0.5m of credit facility amendment costs and ii) $0.1m of incentive fee expense.
CONFERENCE CALL AT 9:00 A.M. ET ON FEBRUARY 10, 2026
The Company will also host a conference call at 9:00 a.m. (Eastern Time) on Tuesday, February 10, 2026 to discuss its financial results. All interested parties are welcome to participate. You can access the conference call by dialing toll-free (800) 330-6710 approximately 5-10 minutes prior to the call. International callers should dial (646) 769-9200. All callers should reference conference ID #9076698 or PennantPark Floating Rate Capital Ltd. An archived replay will also be available on a webcast link located on the Quarterly Earnings page in the Investor section of PennantPark's website.
PORTFOLIO AND INVESTMENT ACTIVITY
"We are pleased with the momentum of our new joint venture, PSSL II, which commenced operations and invested approximately $200 million during the quarter. Following quarter end, the joint venture purchased investments of approximately $130 million bringing total assets to approximately $325 million. Additionally, PSSL II upsized its credit facility, further supporting the plans to grow the NII of PFLT with a goal of dividend coverage" said Art Penn, Chairman and CEO. "Our portfolio continues to perform well, and we remain confident in its durability, underpinned by our disciplined approach to investing in the core middle market."
As of December 31, 2025, our portfolio totaled $2,605.3 million, and consisted of $2,310.2 million of first lien secured debt (including $237.7 million in PSSL and $39.4 million in PSSL II), $20.1 million of second lien and subordinated debt and $275.0 million of preferred and common equity (including $72.7 million in PSSL and $16.9 million in PSSL II). Our debt portfolio consisted of approximately 99% variable-rate investments. As of December 31, 2025, we had four portfolio companies on non-accrual, representing 0.5% and 0.1% of our overall portfolio on a cost and fair value basis, respectively. As of December 31, 2025, the portfolio had net unrealized depreciation of $78.4 million. Our overall portfolio consisted of 160 companies with an average investment size of $16.3 million and had a weighted average yield on debt investments of 9.9%.
As of September 30, 2025, our portfolio totaled $2,773.3 million and consisted of $2,513.6 million of first lien secured debt (including $237.7 million in PSSL), $19.0 million of second lien and subordinated debt and $240.7 million of preferred and common equity (including $44.3 million in PSSL). Our debt portfolio consisted of approximately 99% variable-rate investments. As of September 30, 2025, we had three portfolio companies on non-accrual, representing 0.4% and 0.2% of our overall portfolio on a cost and fair value basis, respectively. As of September 30, 2025, the portfolio had net unrealized depreciation of $46.1 million. Our overall portfolio consisted of 164 companies with an average investment size of $16.9 million, and a weighted average yield on debt investments of 10.2%.
For the three months ended December 31, 2025, we invested $301.0 million in four new and 51 existing portfolio companies at a weighted average yield on debt investments of 10.0%. Sales and repayments of investments for the same period totaled $441.4 million including $132.5 million of sales to PSSL and $196.5 million of sales to PSSL II. For the three months ended December 31, 2024, we invested $606.9 million in 11 new and 58 existing portfolio companies with a weighted average yield on debt investments of 10.3%. Sales and repayments of investments for the same period totaled $401.3 million, including $187.7 million of sales to PSSL.
PennantPark Senior Secured Loan Fund I LLC
As of December 31, 2025, PSSL's portfolio totaled $1,195.0 million, consisted of 120 companies with an average investment size of $10.0 million and had a weighted average yield on debt investments of 9.6%. As of September 30, 2025, PSSL's portfolio totaled $1,084.6 million, consisted of 117 companies with an average investment size of $9.3 million and had a weighted average yield on debt investments of 10.1%.
For the three months ended December 31, 2025, PSSL invested $133.8 million (including $132.5 million purchase from the Company) in four new and 17 existing portfolio companies with a weighted average yield on debt investments of 9.4%. PSSL's sales and repayments of investments for the same period totaled $12.4 million. For the three months ended December 31, 2024, PSSL invested $224.9 million (including $187.7 million purchased from the Company) in 17 new and eight existing portfolio companies with a weighted average yield on debt investments of 10.3%. PSSL's sales and repayments of investments for the same period totaled $86.6 million.
PennantPark Senior Secured Loan Fund II LLC
As of December 31, 2025, PSSL II's portfolio totaled $193.2 million and consisted of 41 companies with an average investment size of $4.7 million and at a weighted average yield on debt investments of 9.0%.
For the three months ended December 31, 2025, PSSL II invested $196.5 million (including $196.5 million purchased from the Company) in 42 new and zero existing portfolio companies at a weighted average yield on debt investments of 9.3%. Sales and repayments of investments for the three months ended December 31, 2025 totaled $2.9 million.
RESULTS OF OPERATIONS
Set forth below are the results of operations for the three months ended December 31, 2025 and 2024.
Investment Income
For the three months ended December 31, 2025 investment income was $70.1 million, which was attributable to $64.2 million from first lien secured debt and $5.9 million from other investments. For the three months ended December 31, 2024, investment income was $67.0 million, which was attributable to $61.0 million from first lien secured debt and $6.0 million from other investments. The increase in investment income for the three months ended December 31, 2025, was primarily due to the increase in the size of the debt portfolio.
Expenses
For the three months ended December 31, 2025, expenses totaled $43.5 million and were comprised of: $27.2 million of debt related interest and expenses, $6.8 million of base management fees, $6.7 million of performance-based incentive fees, $2.1 million of general and administrative expenses, $0.2 million of taxes and $0.5 million in Credit Facility amendment costs. For the three months ended December 31, 2024, expenses totaled $37.0 million and were comprised of: $22.4 million of debt related interest and expenses, $5.3 million of base management fees, $7.5 million of performance-based incentive fees, $1.7 million of general and administrative expenses and $0.2 million of taxes. The increase in expenses for the three months ended December 31, 2025, was primarily due to the increase in interest expense from increased borrowings as a result of the increase in our investment portfolio.
Net Investment Income
For the three months ended December 31, 2025 and 2024, net investment income totaled $26.6 million or $0.27 per share, and $30.0 million or $0.37 per share, respectively. The decrease in net investment income for the three months ended December 31, 2025, was primarily due to an increase in interest expense and one time credit facility amendment costs.
Net Realized Gains or Losses
For the three months ended December 31, 2025 and 2024, net realized gains (losses) totaled $1.5 million and $26.7 million, respectively. The change in net realized gains (losses) was primarily due to changes in the market conditions of our investments and the values at which they were realized.
Unrealized Appreciation or Depreciation on Investments and Debt
For the three months ended December 31, 2025 and 2024, we reported net change in unrealized appreciation (depreciation) on investments of $(32.3) million and $(29.0) million, respectively. As of December 31, 2025 and September 30, 2025, our net unrealized appreciation (depreciation) on investments totaled $(78.4) million and $(46.1) million, respectively. The net change in unrealized appreciation (depreciation) on our investments was primarily due to the operating performance of the portfolio companies within our portfolio, changes in the capital market conditions of our investments, and realization of investments.
For the three months ended December 31, 2025 and 2024, our Credit Facility had a net change in unrealized appreciation (depreciation) of less than ($0.1) million and $0.1 million, respectively. As of December 31, 2025 and September 30, 2025, the net unrealized appreciation (depreciation) on the Credit Facility totaled zero, respectively. The net change in net unrealized (appreciation) or depreciation was primarily due to changes in the capital markets.
Net Change in Net Assets Resulting from Operations
For the three months ended December 31, 2025 and 2024, net increase (decrease) ...
