NMF SLF I's Net Assets Decline Amidst Worsening Investment Performance

TL;DR

**NMF SLF I is bleeding cash and its investments are tanking; get out now.**

AI Summary

NMF SLF I, Inc. reported a net decrease in net assets resulting from operations of $9,730 thousand for the three months ended June 30, 2025, a significant decline from the $27,183 thousand increase in the prior year period. Total investment income decreased to $38,620 thousand for the three months ended June 30, 2025, down from $42,163 thousand in the same period of 2024. This was primarily driven by a reduction in interest income (excluding PIK) from $38,571 thousand to $36,477 thousand. The company experienced a net change in unrealized depreciation of investments of $9,656 thousand for the three months ended June 30, 2025, compared to $3,268 thousand in depreciation for the same period in 2024, indicating a worsening investment portfolio performance. Net assets decreased from $983,730 thousand as of December 31, 2024, to $971,340 thousand as of June 30, 2025. Borrowings under the Wells Credit Facility decreased from $504,400 thousand to $408,800 thousand, reflecting a reduction in leverage. Earnings per share also declined from $0.31 to $0.19 for the three months ended June 30, 2025, compared to the prior year.

Why It Matters

This filing reveals a concerning trend for NMF SLF I, Inc., with a notable decrease in net assets and a significant shift from net investment income to net realized and unrealized losses. For investors, this signals potential erosion of capital and reduced returns, impacting shareholder value. Employees might face uncertainty if the company's financial health continues to deteriorate, potentially affecting job security or compensation. Customers could see impacts on service quality or product offerings if the company tightens its belt. In the broader market, this performance could reflect challenging conditions in the financial services and software sectors where NMF SLF I has significant investments, potentially signaling broader industry headwinds or increased competitive pressures.

Risk Assessment

Risk Level: high — The company reported a net decrease in net assets of $9,730 thousand for the three months ended June 30, 2025, a stark reversal from a $27,183 thousand increase in the prior year. Furthermore, net change in unrealized depreciation of investments worsened significantly to $9,656 thousand from $3,268 thousand in the same period last year, indicating substantial portfolio value erosion.

Analyst Insight

Investors should consider reducing exposure to NMF SLF I, Inc. given the declining net assets, significant unrealized losses, and reduced earnings per share. A thorough review of the investment portfolio's underlying assets and their prospects is warranted before making any further investment decisions.

Financial Highlights

debt To Equity

0.50

revenue

$38,620,000

operating Margin

71.9%

total Assets

$1,458,048,000

total Debt

$402,556,000

net Income

$18,069,000

eps

$0.19

gross Margin

N/A

cash Position

$24,797,000

revenue Growth

-8.4%

Revenue Breakdown

Key Numbers

• $971.34M — Total Net Assets (Decreased from $983.73M as of December 31, 2024)
• $18.07M — Net increase (decrease) in net assets from operations (Q2 2025) (Decreased from $27.18M in Q2 2024)
• $38.62M — Total Investment Income (Q2 2025) (Decreased from $42.16M in Q2 2024)
• $9.66M — Net change in unrealized depreciation of investments (Q2 2025) (Worsened from $3.27M depreciation in Q2 2024)
• $0.19 — Earnings per share (Q2 2025) (Decreased from $0.31 in Q2 2024)
• $408.80M — Wells Credit Facility Borrowings (Decreased from $504.40M as of December 31, 2024)
• 94,989,279 — Common stock shares outstanding (As of August 13, 2025)
• $10.31 — Net asset value per share (Decreased from $10.44 as of December 31, 2024)
• $52.30M — Distributions declared to stockholders (six months ended June 30, 2025) (Decreased from $58.75M in the prior year period)
• $1.41B — Non-controlled/non-affiliated investments at fair value (Decreased from $1.45B as of December 31, 2024)

Key Players & Entities

• NMF SLF I, Inc. (company) — registrant
• Wells Credit Facility (company) — borrowing source
• Wealth Enhancement Group, LLC (company) — portfolio company
• Anaplan, Inc. (company) — portfolio company
• Zone Climate Services, Inc. (company) — portfolio company
• Syndigo LLC (company) — portfolio company
• Associations Finance, Inc. (company) — portfolio company
• Higginbotham Insurance Agency, Inc. (company) — portfolio company
• AAH Topco, LLC (company) — portfolio company
• iCIMS, Inc. (company) — portfolio company

FAQ

Risk Factors

• Investment Portfolio Depreciation [high — market]: The company experienced a net change in unrealized depreciation of investments of $9,656,000 for the three months ended June 30, 2025, a significant worsening from $3,268,000 in depreciation for the same period in 2024. This indicates a deteriorating fair value of the investment portfolio.
• Declining Net Assets and EPS [medium — financial]: Net assets decreased from $983,730,000 as of December 31, 2024, to $971,340,000 as of June 30, 2025. Earnings per share also declined to $0.19 for Q2 2025 from $0.31 in the prior year period, reflecting reduced profitability.
• Leverage Reduction [medium — financial]: Borrowings under the Wells Credit Facility decreased from $504,400,000 as of December 31, 2024, to $408,800,000 as of June 30, 2025. While this reduces financial risk, it also implies a potential reduction in investment capacity or deleveraging strategy.
• Interest Income Sensitivity [medium — market]: Total investment income decreased to $38,620,000 in Q2 2025 from $42,163,000 in Q2 2024, primarily driven by a reduction in interest income (excluding PIK) from $38,571,000 to $36,477,000. This highlights sensitivity to interest rate environments and asset yields.

Industry Context

NMF SLF I, Inc. operates within the financial services sector, likely as a specialty finance or investment company. The current environment appears challenging, with declining investment income and significant unrealized depreciation in its investment portfolio. Companies in this space are sensitive to interest rate changes, credit market conditions, and overall economic health, which can impact asset valuations and borrowing costs.

Regulatory Implications

As a financial entity, NMF SLF I, Inc. is subject to various financial regulations. The reported decrease in net assets and earnings could attract scrutiny regarding capital adequacy and risk management practices. Changes in leverage and investment performance may also be reviewed by regulatory bodies to ensure compliance with industry standards and investor protection.

What Investors Should Do

1. Monitor the trend of unrealized depreciation in the investment portfolio closely, as it significantly impacted Q2 2025 results and could continue to erode net asset value.
2. Analyze the drivers behind the decline in interest income and fee income to understand the sustainability of current revenue streams and potential for recovery.
3. Evaluate the company's strategy regarding its Wells Credit Facility borrowings; while reduced leverage lowers risk, it may also signal a contraction in investment activity or a shift in capital structure.
4. Assess the impact of the $52.30M distribution payable on cash flow and liquidity in the upcoming periods, given the decrease in declared distributions compared to the prior year.

Key Dates

• 2025-06-30: End of Second Quarter 2025 — Reporting period for the financial results showing a decrease in net assets from operations and worsening investment performance.
• 2025-06-30: Consolidated Statements of Assets and Liabilities — Shows total net assets of $971,340,000, down from $983,730,000 at year-end 2024.
• 2025-06-30: Consolidated Statements of Operations — Details a net decrease in net assets from operations of $18,069,000 for Q2 2025, compared to an increase of $27,183,000 in Q2 2024.
• 2024-12-31: End of Fiscal Year 2024 — Prior period benchmark for net assets and borrowings, showing $983,730,000 in net assets and $504,400,000 in Wells Credit Facility borrowings.

Glossary

Payment-in-kind ("PIK") interest income

Interest that is not paid in cash but is instead added to the principal balance of the loan, increasing the amount owed. (A component of investment income that has decreased significantly, impacting overall revenue.)

Net change in unrealized appreciation (depreciation) of investments

The change in the fair value of investments that have not yet been sold, reflecting market fluctuations. (A key indicator of investment portfolio performance, which has worsened considerably, showing depreciation.)

Wells Credit Facility

A specific line of credit or loan facility provided by Wells Fargo, used by the company for financing its investments. (The outstanding balance on this facility has decreased, indicating reduced leverage.)

Net assets

The total value of a company's assets minus its total liabilities. For investment companies, it represents the value available to shareholders. (The company's net assets have decreased, reflecting a decline in overall value.)

Earnings per share (EPS)

The portion of a company's profit allocated to each outstanding share of common stock. (EPS has declined, indicating lower profitability on a per-share basis.)

Year-Over-Year Comparison

Compared to the prior year period, NMF SLF I, Inc. has seen a significant downturn. Total investment income for the three months ended June 30, 2025, decreased by 8.4% to $38.62 million from $42.16 million in Q2 2024. More critically, the net increase in net assets from operations fell by 33.6% to $18.07 million, down from $27.18 million. The company also experienced a substantial worsening in investment performance, with unrealized depreciation increasing from $3.27 million to $9.66 million. Earnings per share declined from $0.31 to $0.19, reflecting these adverse operational and market conditions.

Filing Documents

• nmslf-20250630.htm (10-Q) — 8866KB
• nmfslfi-06302025xex311.htm (EX-31.1) — 9KB
• nmfslfi-06302025xex312.htm (EX-31.2) — 9KB
• nmfslfi-06302025xex321.htm (EX-32.1) — 4KB
• nmfslfi-06302025xex322.htm (EX-32.2) — 4KB
• 0001766037-25-000012.txt ( ) — 21877KB
• nmslf-20250630.xsd (EX-101.SCH) — 60KB
• nmslf-20250630_cal.xml (EX-101.CAL) — 43KB
• nmslf-20250630_def.xml (EX-101.DEF) — 314KB
• nmslf-20250630_lab.xml (EX-101.LAB) — 629KB
• nmslf-20250630_pre.xml (EX-101.PRE) — 404KB
• nmslf-20250630_htm.xml (XML) — 5213KB

FINANCIAL INFORMATION

PART I. FINANCIAL INFORMATION Item 1.

Financial Statements

Financial Statements Consolidated Statements of Assets and Liabilities as of June 3 0 , 2025 (unaudited) and December 31, 2024 3 Consolidated Statements of Operations for the three and s ix months ended June 30, 2025 (unaudited) and June 30, 20 24 (unaudited) 4 Consolidated Statements of Changes in Net Assets for the three and s ix months ended June 30, 2025 (unaudited) and June 30, 2024 (unaudited) 5 Consolidated Statements of Cash Flows for the s ix months ended June 30 , 2025 (unaudited) and June 30 , 2024 (unaudited) 6 Consolidated Schedule of Investments as o f June 30, 2025 (unaudited) 7 Consolidated Schedule of Investments as of December 31, 2024 29 Notes to the Consolidated Financial Statements of NMF SLF I, Inc. (unaudited) 49 Report of Independent Registered Public Accounting Firm 67 Item 2.

Management's Discussion and Analysis of Financial Condition and Results of Operations

Management's Discussion and Analysis of Financial Condition and Results of Operations 68 Item 3.

Quantitative and Qualitative Disclosures About Market Risk

Quantitative and Qualitative Disclosures About Market Risk 80 Item 4.

Controls and Procedures

Controls and Procedures 81

OTHER INFORMATION

PART II. OTHER INFORMATION Item 1.

Legal Proceedings

Legal Proceedings 82 Item 1A.

Risk Factors

Risk Factors 82 Item 2. Unregistered Sales of Equity Securities and Use of Proceeds 82 Item 3. Defaults Upon Senior Securities 82 Item 4. Mine Safety Disclosures 82 Item 5. Other Information 82 Item 6. Exhibits 83

Signatures

Signatures 84 2 Table of Contents

FINANCIAL INFORMATION

PART I. FINANCIAL INFORMATION

Financial Statements

Item 1. Financial Statements NMF SLF I, Inc. Consolidated Statements of Assets and Liabilities (in thousands, except shares and per share data) (unaudited) June 30, 2025 December 31, 2024 Assets Non-controlled/non-affiliated investments at fair value (cost of $ 1,426,974 and $ 1,451,005 , respectively) $ 1,411,585 $ 1,445,655 Cash and cash equivalents 24,797 20,399 Interest and dividend receivable 9,525 10,030 Receivable from unsettled securities sold — 10,303 Other assets 12,141 485 Total assets $ 1,458,048 $ 1,486,872 Liabilities Borrowings Wells Credit Facility $ 408,800 $ 504,400 Deferred financing costs (net of accumulated amortization of $ 6,273 and $ 5,050 , respectively) ( 6,244 ) ( 7,467 ) Net borrowings 402,556 496,933 Distribution payable 52,301 — Payable for unsettled securities purchased 26,089 — Interest payable 2,268 2,908 Management fee payable 2,210 2,360 Payable to affiliates 134 122 Other liabilities 1,150 819 Total liabilities 486,708 503,142 Commitments and contingencies (See Note 8) Net Assets Common stock, par value 0.001 , 500,000,000 shares authorized, 94,236,672 and 94,236,672 shares issued and outstanding, respectively 94 94 Paid in capital in excess of par 983,610 983,610 Accumulated (overdistributed) undistributed earnings ( 12,364 ) 26 Total net assets $ 971,340 $ 983,730 Total liabilities and net assets $ 1,458,048 $ 1,486,872 Net asset value per share $ 10.31 $ 10.44 The accompanying notes are an integral part of these consolidated financial statements. 3 Table of Contents NMF SLF I, Inc. Consolidated Statements of Operations (in thousands, except shares and per share data) (unaudited) Three Months Ended Six Months Ended June 30, 2025 June 30, 2024 June 30, 2025 June 30, 2024 Investment income Interest income (excluding Payment-in-kind ("PIK") interest income) $ 36,477 $ 38,571 $ 71,982 $ 75,388 PIK interest income 1,364 2,089 2,759 4,398 Dividend income 245 — 450 — Fee income

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