New Mountain Guardian IV BDC Sees Strong Income Growth, Asset Expansion

New Mountain Guardian IV Bdc, L.L.C. 10-Q Filing Summary
FieldDetail
CompanyNew Mountain Guardian IV Bdc, L.L.C.
Form Type10-Q
Filed DateNov 12, 2025
Risk Levelmedium
Pages16
Reading Time19 min
Sentimentmixed

Sentiment: mixed

Topics: BDC, Investment Income, Unrealized Losses, Asset Growth, Credit Facilities, Financial Services, Private Credit

TL;DR

**New Mountain Guardian IV BDC is growing its income and assets, but watch out for those unrealized losses on investments – it's a mixed bag for now.**

AI Summary

New Mountain Guardian IV BDC, L.L.C. reported a net increase in members' capital from operations of $57.520 million for the nine months ended September 30, 2025, up from $39.627 million for the same period in 2024. Total investment income significantly increased to $129.937 million for the nine months ended September 30, 2025, compared to $80.562 million in the prior year, driven by a rise in interest income (excluding PIK) to $120.370 million from $70.770 million. Net investment income before income taxes also saw a substantial increase to $68.856 million from $38.323 million. However, the company experienced a net change in unrealized depreciation of investments of $10.100 million for the nine months ended September 30, 2025, a reversal from $1.520 million in unrealized appreciation in 2024. Total assets grew to $1,734.829 million as of September 30, 2025, from $1,547.749 million at December 31, 2024, primarily due to an increase in non-controlled/non-affiliated investments at fair value to $1,631.454 million and a significant jump in cash and cash equivalents to $90.893 million from $19.866 million. Borrowings also increased, with the Wells Credit Facility rising to $494.500 million from $437.200 million and the UBS Credit Facility to $327.000 million from $262.500 million.

Why It Matters

For investors, the significant increase in net investment income and total assets suggests robust operational performance and portfolio growth for New Mountain Guardian IV BDC. The rise in interest income indicates effective deployment of capital in a favorable interest rate environment, which could lead to higher distributions. However, the shift from unrealized appreciation to depreciation on investments warrants close monitoring, as it could signal potential valuation challenges in parts of the portfolio or broader market headwinds. This mixed sentiment could influence investor confidence and the company's competitive positioning against other BDCs, impacting its ability to attract new capital and retain existing unitholders.

Risk Assessment

Risk Level: medium — The risk level is medium due to the significant increase in net change in unrealized depreciation of investments, which moved from an appreciation of $1.520 million in the nine months ended September 30, 2024, to a depreciation of $10.100 million in the same period of 2025. This indicates potential valuation pressures on the investment portfolio. Additionally, total borrowings increased substantially, with the Wells Credit Facility rising by $57.300 million and the UBS Credit Facility by $64.500 million, increasing leverage.

Analyst Insight

Investors should scrutinize the underlying reasons for the $10.100 million unrealized depreciation in investments, as this could signal future realized losses. While income growth is strong, consider the impact of increased leverage from the Wells and UBS Credit Facilities on the company's financial stability and interest expense burden. Monitor future filings for trends in asset valuations and debt management.

Financial Highlights

debt To Equity
0.99
revenue
$129.937M
operating Margin
53.0%
total Assets
$1,734.829M
total Debt
$815.787M
net Income
$68.624M
eps
$0.78
gross Margin
N/A
cash Position
$90.893M
revenue Growth
+61.3%

Revenue Breakdown

SegmentRevenueGrowth
Interest income (excluding PIK)$120.370M+69.9%
Dividend income$2.565M+1513.2%
Fee income$3.703M-38.4%

Key Numbers

  • $129.937M — Total investment income (Increased from $80.562M in 2024 for the nine months ended September 30.)
  • $68.856M — Net investment income before income taxes (Increased from $38.323M in 2024 for the nine months ended September 30.)
  • $57.520M — Net increase in members' capital from operations (Increased from $39.627M in 2024 for the nine months ended September 30.)
  • $10.100M — Net change in unrealized depreciation of investments (Shifted from $1.520M appreciation in 2024 for the nine months ended September 30.)
  • $1,734.829M — Total assets (Increased from $1,547.749M at December 31, 2024.)
  • $90.893M — Cash and cash equivalents (Increased from $19.866M at December 31, 2024.)
  • $494.500M — Wells Credit Facility borrowings (Increased from $437.200M at December 31, 2024.)
  • $327.000M — UBS Credit Facility borrowings (Increased from $262.500M at December 31, 2024.)
  • 87,013,843 — Common units outstanding (Increased from 80,974,363 units at December 31, 2024.)
  • $10.01 — Members' capital per unit (Decreased from $10.13 at December 31, 2024.)

Key Players & Entities

  • New Mountain Guardian IV BDC, L.L.C. (company) — registrant
  • Wells Credit Facility (company) — borrowing facility
  • UBS Credit Facility (company) — borrowing facility
  • Securities and Exchange Commission (regulator) — filing oversight
  • Viper Bidco, Inc. (company) — portfolio company
  • Coupa Holdings, LLC (company) — portfolio company
  • WEG Sub Intermediate Holdings, LLC (company) — portfolio company
  • Anaplan, Inc. (company) — portfolio company
  • Associations Finance, Inc. (company) — portfolio company

FAQ

What were the key drivers of New Mountain Guardian IV BDC's investment income growth in Q3 2025?

The primary driver was a significant increase in interest income (excluding PIK interest income), which rose to $120.370 million for the nine months ended September 30, 2025, from $70.770 million in the same period of 2024.

How did New Mountain Guardian IV BDC's net investment income change year-over-year?

Net investment income before income taxes for New Mountain Guardian IV BDC increased substantially to $68.856 million for the nine months ended September 30, 2025, compared to $38.323 million for the same period in 2024.

What was the trend in unrealized gains and losses for New Mountain Guardian IV BDC's investments?

New Mountain Guardian IV BDC experienced a net change in unrealized depreciation of investments of $10.100 million for the nine months ended September 30, 2025. This contrasts with a net change in unrealized appreciation of $1.520 million for the same period in 2024.

What is the current outstanding amount for New Mountain Guardian IV BDC's credit facilities?

As of September 30, 2025, the Wells Credit Facility had outstanding borrowings of $494.500 million, and the UBS Credit Facility had outstanding borrowings of $327.000 million.

How many common units were outstanding for New Mountain Guardian IV BDC as of November 12, 2025?

As of November 12, 2025, the number of New Mountain Guardian IV BDC's limited liability company units outstanding was 87,013,843.

What is the members' capital per unit for New Mountain Guardian IV BDC?

As of September 30, 2025, the members' capital per unit for New Mountain Guardian IV BDC was $10.01, a slight decrease from $10.13 at December 31, 2024.

Did New Mountain Guardian IV BDC waive any management fees during the period?

Yes, New Mountain Guardian IV BDC waived management fees of $24 thousand for the three months ended September 30, 2025, and $45 thousand for the nine months ended September 30, 2025.

What were the total assets for New Mountain Guardian IV BDC at the end of Q3 2025?

Total assets for New Mountain Guardian IV BDC were $1,734.829 million as of September 30, 2025, an increase from $1,547.749 million at December 31, 2024.

What was the net cash flow from operating activities for New Mountain Guardian IV BDC?

For the nine months ended September 30, 2025, New Mountain Guardian IV BDC reported net cash flows used in operating activities of $65.211 million, a significant change from net cash flows used in operating activities of $561.858 million in the prior year.

Which industries are prominent in New Mountain Guardian IV BDC's investment portfolio?

Prominent industries in New Mountain Guardian IV BDC's portfolio include Software, Financial Services, Business Services, Consumer Services, Healthcare, and Education, as evidenced by investments in companies like Viper Bidco, Inc. (Software) and WEG Sub Intermediate Holdings, LLC (Financial Services).

Risk Factors

  • Investment Depreciation [medium — financial]: The company experienced a net change in unrealized depreciation of investments of $10.100 million for the nine months ended September 30, 2025. This is a reversal from $1.520 million in unrealized appreciation for the same period in 2024, indicating a deterioration in the fair value of its investment portfolio.
  • Increased Borrowings [medium — financial]: Total borrowings increased significantly, with the Wells Credit Facility rising to $494.500 million from $437.200 million and the UBS Credit Facility to $327.000 million from $262.500 million. This increased leverage amplifies both potential gains and losses.
  • Decreasing Members' Capital per Unit [low — financial]: Despite operational growth, members' capital per unit decreased to $10.01 as of September 30, 2025, from $10.13 at December 31, 2024. This suggests that the increase in outstanding units or other factors have diluted the per-unit value.
  • Interest Rate Sensitivity [medium — market]: As a BDC, the company's profitability is heavily influenced by interest income. Fluctuations in interest rates, particularly changes in benchmark rates affecting its loan portfolio and borrowing costs, pose a significant market risk.
  • Management and Incentive Fees [low — operational]: Management fees remained substantial at $7.236 million for the nine months ended September 30, 2025, and income-based incentive fees increased to $11.813 million. These fees can impact net investment income, especially during periods of strong performance.

Industry Context

Business Development Companies (BDCs) operate in a dynamic environment, providing capital to middle-market companies. The industry is sensitive to interest rate movements, as BDCs often hold floating-rate debt and rely on borrowing for leverage. Competition for attractive investment opportunities is ongoing, and regulatory oversight remains a key factor.

Regulatory Implications

As a BDC, New Mountain Guardian IV is subject to regulations under the Investment Company Act of 1940. Compliance with leverage limits, asset coverage requirements, and reporting obligations is crucial. Changes in accounting standards or regulatory interpretations could impact financial reporting and operational flexibility.

What Investors Should Do

  1. Monitor the trend of unrealized depreciation.
  2. Analyze the impact of increased leverage.
  3. Evaluate the drivers of per-unit capital decline.
  4. Assess the sustainability of investment income growth.

Key Dates

  • 2025-09-30: Nine months ended September 30, 2025 — Reported significant growth in total investment income ($129.937M vs $80.562M) and net investment income ($68.856M vs $38.323M), but also a reversal to net unrealized depreciation ($10.100M).
  • 2024-09-30: Nine months ended September 30, 2024 — Prior period comparison showing lower investment income ($80.562M) and net investment income ($38.323M), but unrealized appreciation ($1.520M).
  • 2025-09-30: As of September 30, 2025 — Total assets grew to $1,734.829M, with substantial increases in non-controlled investments and cash ($90.893M).
  • 2024-12-31: As of December 31, 2024 — Prior period balance sheet showing total assets of $1,547.749M and lower cash reserves ($19.866M).

Glossary

PIK interest income
Payment-in-kind interest income, where interest is paid in the form of additional debt or equity rather than cash. (This is a component of investment income, and its trend (decreasing from $3.595M to $3.299M) is noted.)
Net investment income
The income generated from a company's investments after deducting operating expenses. (Increased significantly to $68.856M for the nine months ended September 30, 2025, indicating improved core profitability from operations.)
Unrealized depreciation
A decrease in the market value of an asset that has not yet been sold. (The company experienced $10.100M in net unrealized depreciation, a negative shift from prior year appreciation, impacting overall capital changes.)
BDC
Business Development Company, a type of closed-end investment company that invests in small and medium-sized U.S. businesses. (New Mountain Guardian IV is structured as a BDC, meaning its operations and financial performance are subject to specific regulations and market dynamics for this asset class.)
Members' capital per unit
The net asset value attributable to each outstanding unit of membership interest. (Decreased to $10.01 from $10.13, suggesting potential dilution or a decline in per-unit value despite overall asset growth.)

Year-Over-Year Comparison

New Mountain Guardian IV BDC, L.L.C. shows robust growth in investment income for the nine months ended September 30, 2025, up 61.3% to $129.937M, primarily driven by higher interest income. Net investment income before taxes also surged by 79.6% to $68.856M. However, this period saw a significant reversal in investment valuation, moving from $1.520M in unrealized appreciation to $10.100M in unrealized depreciation. Total assets grew to $1,734.829M, supported by increased investments and a substantial rise in cash reserves, while total borrowings also increased across its credit facilities.

Filing Stats: 4,655 words · 19 min read · ~16 pages · Grade level 5.6 · Accepted 2025-11-12 13:43:31

Filing Documents

FINANCIAL INFORMATION

PART I. FINANCIAL INFORMATION Item 1.

Financial Statements

Financial Statements Consolidated Statements of Assets, Liabilities and Members' Capital as of September 30, 2025 (unaudited) and December 31, 2024 3 Consolidated Statements of Operations for the three and nine months ended September 30, 2025 (unaudited) and September 30, 2024 (unaudited) 4 Consolidated Statements of Changes in Members' Capital for the three and nine months ended September 30, 2025 (unaudited) and September 30, 2024 (unaudited) 5 Consolidated Statements of Cash Flows for the nine months ended September 30, 2025 (unaudited) and September 30, 2024 (unaudited) 6 Consolidated Schedule of Investments as of September 30, 2025 (unaudited) 7 Consolidated Schedule of Investments as of December 31, 2024 30 Notes to the Consolidated Financial Statements of New Mountain Guardian IV BDC, L.L.C. (unaudited) 50 Report of Independent Registered Public Accounting Firm 72 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 73 Item 3.

Quantitative and Qualitative Disclosures About Market Risk

Quantitative and Qualitative Disclosures About Market Risk 86 Item 4.

Controls and Procedures

Controls and Procedures 87

OTHER INFORMATION

PART II. OTHER INFORMATION Item 1.

Legal Proceedings

Legal Proceedings 88 Item 1A.

Risk Factors

Risk Factors 88 Item 2. Unregistered Sales of Equity Securities and Use of Proceeds 88 Item 3. Defaults Upon Senior Securities 88 Item 4. Mine Safety Disclosures 88 Item 5. Other Information 88 Item 6. Exhibits 89

Signatures

Signatures 90 2 Table of Contents

FINANCIAL INFORMATION

PART I. FINANCIAL INFORMATION

Financial Statements

Item 1. Financial Statements New Mountain Guardian IV BDC, L.L.C. Consolidated Statements of Assets, Liabilities and Members' Capital (in thousands, except units and per unit data) (unaudited) September 30, 2025 December 31, 2024 Assets Non-controlled/non-affiliated investments at fair value (cost of $ 1,628,650 and $ 1,503,719 , respectively) $ 1,631,454 $ 1,516,623 Cash and cash equivalents 90,893 19,866 Interest and dividend receivable 11,712 10,866 Other assets 770 394 Total assets $ 1,734,829 $ 1,547,749 Liabilities Borrowings Wells Credit Facility $ 494,500 $ 437,200 UBS Credit Facility 327,000 262,500 Deferred financing costs (net of accumulated amortization of $ 2,540 and $ 1,361 , respectively) ( 5,713 ) ( 5,770 ) Net borrowings 815,787 693,930 Distribution payable 22,187 — Payable for unsettled securities purchased 12,328 20,051 Interest payable 4,591 4,636 Income based incentive fee payable 3,954 3,379 Management fee payable 2,480 2,213 Payable to affiliate 403 344 Deferred tax liability 320 57 Accrued capital gains incentive fee 236 1,907 Other liabilities 1,520 1,134 Total liabilities 863,806 727,651 Commitments and contingencies (See Note 8) Members' Capital Common units, 87,013,843 and 80,974,363 units issued and outstanding, respectively 866,781 806,386 Accumulated underdistributed (overdistributed) earnings 4,242 13,712 Total members' capital $ 871,023 $ 820,098 Total liabilities and members' capital $ 1,734,829 $ 1,547,749 Outstanding common membership units 87,013,843 80,974,363 Members' capital per unit $ 10.01 $ 10.13 The accompanying notes are an integral part of these consolidated financial statements. 3 Table of Contents New Mountain Guardian IV BDC, L.L.C. Consolidated Statements of Operations (in thousands, except units and per unit data) (unaudited) Three Months Ended Nine Months Ended September 30, 2025 September 30, 2024 September 30, 2025 September 30, 2024 Investment income Int

View Full Filing

View this 10-Q filing on SEC EDGAR

View on ReadTheFiling | About | Contact | Privacy | Terms

Data from SEC EDGAR. Not affiliated with the SEC. Not investment advice. © 2026 OpenDataHQ.