New Mountain Finance Corporation announced its financial results for the quarter ended June 30, 2025. The company reported Net Investment Income (NII) of $0.32 per weighted average share for Q2 2025, a decrease from $0.36 per weighted average share in Q2 2024. Total investment income for the quarter was $83.490 million, down from $94.588 million in the prior year period.
The company declared a third quarter distribution of $0.32 per share, maintaining its regular dividend. Net asset value (NAV) per share was $12.21 as of June 30, 2025, representing a $0.24 decline from the previous quarter. The statutory debt-to-equity ratio was 1.17x, reflecting the company's leverage position.
NMFC continued to advance its strategic priorities, increasing senior-oriented assets to nearly 80% of the overall portfolio. The company repurchased $9.6 million worth of shares during the quarter, demonstrating management's belief that the stock is undervalued. Additionally, NMFC monetized its $15 million common equity position in Office Ally and received full repayment on ARCOS preferred shares, including all previously accrued Payment-in-Kind (PIK).
However, the internal risk ratings of the portfolio saw some negative movement, with one consumer products company migrating from a 'Yellow' to a 'Red' risk rating. This company is impacted by tariffs on its China-oriented supply chain and is expected to require liquidity support before year-end. Despite this, non-accruals remained low at $38 million, or 1.2% of the portfolio's fair value.
For investors, the Q2 results show a continued decline in NII and NAV per share year-over-year, which are important performance indicators. The share repurchases and successful monetization of equity and PIK positions are positive developments in capital management. However, the downgrade of a portfolio company to 'Red' highlights specific credit challenges within the portfolio that warrant attention.
The content on BeyondSPX is for informational purposes only and should not be construed as financial or investment advice. We are not financial advisors. Consult with a qualified professional before making any investment decisions. Any actions you take based on information from this site are solely at your own risk.