Executive Summary

Q3 results were mixed: NII/share of $0.43 declined QoQ and missed S&P Global consensus ($0.45), while NAV/share slipped modestly to $17.85; investment income fell to $51.1M and missed consensus ($52.2M) as spreads tightened and the base rate declined . NII/share: $0.43 vs $0.45*; Investment income: $51.1M vs $52.2M* (miss) (Values with * from S&P Global) .
Credit held up but risk ticked higher: non‑accruals increased to three names (0.4% FV; 0.9% cost) and watchlist rose to 7.3% of FV from 6.7% QoQ, though the portfolio remains 89.8% first lien and highly diversified across 213 companies .
Fee normalization was a clear headwind: management fee step‑up (0.75%→1.00%) and incentive fees reduced NII by ~$0.08/share; absent these, NII would have been ~$0.46/share, above the $0.45 dividend run‑rate .
Liquidity and funding remain strong with $316M of capacity, no near‑term maturities, and 27% of debt unsecured; Q4 dividend maintained at $0.45/share, underscoring confidence in coverage despite NII pressure .
Management expects transaction activity momentum to continue into 2026, supported by a seasoned platform and disciplined underwriting; catalysts include origination pickup, credit resolution progress, and sustained dividend coverage .

What Went Well and What Went Wrong

What Went Well
- Portfolio quality and diversification: 89.8% first‑lien exposure with top 10 positions only 13.6% of FV across 213 companies (26 industries), mitigating idiosyncratic risk .
- Balance sheet strength: $316M liquidity; diversified funding (3 CLOs, revolver, unsecured), no near‑term maturities; debt/eq 1.25x (1.20x net) at quarter‑end supports consistent deployment .
- Dividend stability: Q3 regular dividend of $0.45 paid; Q4 regular dividend of $0.45 declared—consistent since Q2’24—with undistributed spillover distributable income (~$0.29/share) cited in materials earlier in the year supporting coverage .
- Management tone: “We are encouraged by the positive momentum and pickup in transaction activity… well‑positioned… high‑quality diversified portfolio and strong capital structure” — CEO Ken Kencel .
What Went Wrong
- Earnings pressure vs. estimates: NII/share ($0.43) missed S&P Global consensus ($0.45*) and investment income ($51.1M) missed ($52.2M*), driven by lower yields and average borrowing balances .
- Fee normalization headwind: mgmt fee step‑up and incentive fees reduced NII by ~~$4.1M (~~$0.08/share); reported NII/share would have been ~$0.46/share excluding these effects .
- Credit slippage: Non‑accruals rose to 3 companies (0.4% FV; 0.9% cost); watchlist increased to 7.3% FV; notable unrealized markdowns included Career Now and Covercraft .

Financial Results

Metric	Q1 2025	Q2 2025	Q3 2025
Investment income ($M)	$53.586	$53.132	$51.106
Net investment income ($M)	$27.452	$22.856	$21.386
NII per share ($)	$0.53	$0.46	$0.43
Net realized & unrealized gain (loss) per share ($)	$(0.24)	$(0.14)	$(0.05)
Net inc. in net assets from ops per share ($)	$0.29	$0.32	$0.38
NAV per share ($)	$17.96	$17.92	$17.85
Regular distribution per share ($)	$0.45	$0.45	$0.45
Debt-to-equity (quarter-end) (x)	1.31x	1.26x	1.25x
Weighted avg asset yield at cost (%)	10.1%	10.1%	9.9%
Net interest margin (bps)	360	358	337
Non-accruals (% FV)	0.4%	0.2%	0.4%
Portfolio FV ($B)	$2.08	$1.99	$1.97
Portfolio companies (count)	210	207	213

Segment/Composition

Composition (% FV)	Q1 2025	Q2 2025	Q3 2025
First-lien debt	90.5%	90.0%	89.8%
Subordinated debt	7.8%	8.0%	8.1%
Equity investments	1.7%	2.0%	2.1%
Floating-rate debt (of debt FV)	94.6%	94.3%	94.2%

Quarterly Investment Activity

Activity ($M)	Q1 2025	Q2 2025	Q3 2025
New gross commitments (par)	$166.2	$47.7	$29.2
Net investments funded	$153.0	$81.1	$36.3
Investments sold/repaid	$(148.4)	$(162.2)	$(61.3)
Net funded investment activity	$4.7	$(81.1)	$(25.0)
New investment WA interest rate (par)	9.38%	9.07%	9.17%

Estimates vs. Actuals (S&P Global)

Metric	Q1 2025 Actual	Q1 2025 Consensus	Q2 2025 Actual	Q2 2025 Consensus	Q3 2025 Actual	Q3 2025 Consensus
EPS (NII/share, $)	0.53	0.56265*	0.46	0.46251*	0.43	0.45011*
Investment income (“Revenue”, $M)	—	56.01*	—	54.19*	51.11	52.20*

Values with * retrieved from S&P Global.

Guidance Changes

Metric	Period	Previous Guidance	Current Guidance	Change
Regular dividend per share	Q4 2025	$0.45 (recent run‑rate)	$0.45 payable Jan 27, 2026	Maintained

No quantitative guidance provided for investment income, margins, OpEx, or tax. Management emphasized strong liquidity, no near‑term maturities, and disciplined origination as qualitative outlook .

Earnings Call Themes & Trends

Topic	Previous Mentions (Q1 & Q2 2025)	Current Period (Q3 2025)	Trend
Origination/activity	Q1: selective deployment; Q2: “positive momentum” with stable risk metrics .	CEO sees “pickup in transaction activity… continue into next year” .	Improving
Dividend coverage	Q1–Q2: Regular $0.45/share, specials ended; spillover distributable income referenced .	Q3: Regular $0.45 paid; Q4 $0.45 declared .	Stable
Credit quality	Q1: non‑accrual 0.4% FV; Q2: 0.2% FV, added watchlist names .	Q3: non‑accruals at 0.4% FV (3 names); watchlist 7.3% FV; specific U/R losses noted .	Slightly deteriorating
Rates/yields	Q1–Q2: asset yields drifted lower with declines in SOFR and spread tightening .	Q3: yield at cost 9.92% vs 10.86% YoY; NIM 337 bps (down) .	Pressured
Balance sheet & liquidity	Q1: $222M; Q2: $304M; diversified funding, unsecured notes issued .	Q3: $316M liquidity; no near‑term maturities; 27% unsecured .	Improving
Fees/expenses	Q1: fee waivers still in place; Q2: waivers expired, mgmt fee step‑up .	Q3: mgmt fee step‑up and incentive fees reduced NII by ~$0.08/share .	Headwind realized

Note: Full transcript not available in our document set; themes reflect press release and earnings materials .

Management Commentary

Strategy and outlook: “We are encouraged by the positive momentum and pickup in transaction activity… As we look ahead to 2026, NCDL remains well‑positioned with respect to our experienced investment team, high‑quality diversified portfolio and strong capital structure.” — Ken Kencel, CEO .
Capital and returns: “NCDL continues to operate from a position of strength… with ample liquidity and no near‑term debt maturities… focused on continuing to invest in high quality assets, optimizing our capital structure, and delivering attractive risk‑adjusted returns.” — Shai Vichness, CFO .
Fee normalization detail: Increase in management fee (0.75%→1.00%) impacted NII by ~~$1.3M (~~$0.02/share); incentive fees ~~$2.8M (~~$0.06/share); total ~~$4.1M (~~$0.08/share). NII would have been ~$0.46/share including these impacts .

Q&A Highlights

We could not locate a Q3 2025 earnings call transcript in the filings corpus; the company did host a call and webcast on Nov 4, 2025 per the press release .
Notable clarifications from the earnings materials: quantification of fee step‑up and incentive fee headwind (~$0.08/share), dividend declaration for Q4, and liquidity position ($316M) .

Estimates Context

EPS: Q3 NII/share of $0.43 missed S&P Global consensus of $0.4501* by ~$0.02; Q2 essentially in line ($0.46 vs $0.4625*); Q1 missed ($0.53 vs $0.5627*) .
Investment income: Q3 $51.1M vs $52.2M* consensus (miss); consensus drifted lower across the year consistent with tightening spreads and lower base rates .
Implication: Street may modestly trim forward NII on continued yield pressure and normalizing fees; dividend coverage remains the key anchor given maintained $0.45/share run‑rate .
Values with * retrieved from S&P Global.

Key Takeaways for Investors

Dividend secured near‑term: Q4 dividend maintained at $0.45/share; despite NII pressure, run‑rate coverage remains intact with strong liquidity and no near‑term maturities .
Fee normalization is a transitory headwind to YoY comps; the explicit ~$0.08/share impact helps frame near‑term NII trajectory and should fade as comps reset .
Watchlist and non‑accruals warrant monitoring (7.3% FV watchlist; 0.4% FV non‑accruals), but first‑lien focus and diversification mitigate tail risk .
Yield pressure continues from spread tightening and lower SOFR; origination at ~9.2% WA rates suggests muted lift to portfolio yield absent a rate move .
Balance sheet optionality: $316M liquidity and 27% unsecured funding create room to play offense on new opportunities and manage liabilities .
Near‑term catalysts: origination pickup into 2026, resolution of watchlist names (Career Now, Covercraft), and sustained dividend coverage should drive sentiment .

Appendix: Additional Data Points

Q3 portfolio FV: $1.968B; first‑lien 89.8%; floating‑rate debt 94.2% .
Q3 leverage: 1.25x debt‑to‑equity (1.20x net); unsecured notes 27% of outstanding debt .
Q3 investment activity: $29.2M new commitments; net funded activity $(25.0)M .

Nuveen Churchill Direct Lending Corp. (NCDL)·Q3 2025 Earnings Summary