8-K: Carlyle Secured Lending III (CSL III) Q4 2024 Results: Portfolio Update Before Merger with CGBD

Carlyle Secured Lending III (CSL III) reports its Q4 2024 and full-year results, highlighting portfolio performance and investment activity prior to its merger with Carlyle Secured Lending, Inc. (CGBD) on March 27, 2025.

Summary

• Carlyle Secured Lending III (CSL III) released its financial results for the fourth quarter and full year ended December 31, 2024.
• On March 27, 2025, CSL III was merged with and into Carlyle Secured Lending, Inc. (CGBD).
• Total investments at fair value were approximately $433 million as of December 31, 2024.
• The fund completed its final capital call of $45 million during the fourth quarter.
• Dividends declared in the fourth quarter totaled $0.75 per share, including a standard quarterly dividend of $0.57 and a supplemental dividend of $0.18.
• The annualized net yield was approximately 10.9%.
• There were approximately $37 million in repayments during the quarter.
• The quarterly net total return was 2.1%.
• For the year ended December 31, 2024, NAV per share was $20.76.
• For the three months ended December 31, 2024, Net Investment Income (NII) per Share was $0.59 and Net Income per Share was $0.53.
• During Q4 2024, CSL III committed $87.2MM across 10 new platform investments and 10 incremental financings for existing borrowers at a blended weighted average yield of ~9.4%.

Sentiment

Score: 7

Explanation: The sentiment is moderately positive due to the successful merger, strong portfolio performance, and high dividend yield, although increased competition is a concern.

Positives

• The company achieved record highs for deployment in both the fourth quarter and full year 2024.
• Market demand for private credit remained strong throughout 2024 and into early 2025.
• The majority of new originations were in first lien assets.
• The company's portfolio had a 0.0% non-accrual rate as of December 31, 2024.
• The company's weighted average yield on debt and income producing investments was 10.7%.

Negatives

• Increased competition for deal flow from traditional direct lenders and the broadly syndicated market was noted.
• The company remains disciplined in the face of this competition.

Risks

• Origination activity and resulting capital deployment is dependent on the Investment Adviser's ability to identify investment opportunities.
• There can be no guarantee that appropriate opportunities will be identified and if they are, that the Company will be selected to originate any or all such opportunities.
• Values are subject to change over time.
• There can be no assurance that we will continue to earn income at this rate and our income may decline.

Future Outlook

The document does not contain specific forward-looking statements beyond the context of historical performance and the merger completion.

Industry Context

The report indicates strong market demand for private credit, but also highlights increased competition for deal flow, reflecting the current dynamics in the direct lending space.

Stakeholder Impact

• Shareholders of CSL III have been impacted by the merger with CGBD.
• Former investors in CSL III are provided with historical performance information.

Key Dates

Keywords

Carlyle Secured Lending III, CSL III, Carlyle Secured Lending, CGBD, Merger, Direct Lending, Private Credit, Investment, Portfolio, Financial Results, Q4 2024