Robert Dodd's questions to New Mountain Finance Corp (NMFC) leadership • Q3 2024
Question
Robert Dodd of Raymond James inquired about the recent decline in portfolio leverage, the strategy for reducing PIK income in 2025, and a discrepancy in the Senior Loan Program's (SLP) income versus its dividend payout.
Answer
Laura Holson, COO, explained that lower portfolio leverage is due to interest coverage constraints on new deals but emphasized their focus on the stable loan-to-value metric. John Kline, CEO, stated that PIK reduction will come from exiting legacy 100% PIK assets, aiming for a long-term PIK ratio under 10-12%. Laura Holson also clarified that the SLP dividend variance was merely a matter of timing and not indicative of any performance issues.