Manulife Private Credit Fund Leans Heavily on Industrials, Healthcare

TL;DR

**Manulife Private Credit Fund is all-in on floating-rate senior loans, making it a strong play if rates stay high, but watch out for sector concentration.**

AI Summary

Manulife Private Credit Fund's 10-Q filing for the quarter ended September 30, 2025, reveals a substantial portfolio of senior loans totaling $334,817,296, representing 195.3% of net assets, with a cost basis of $334,636,390. The fund's investments are heavily concentrated in Industrials (74.2% or $127,209,915), Health Care (39.0% or $66,939,490), and Consumer Discretionary (42.4% or $72,727,222). Notably, the fund holds a significant portion of its senior loans in variable-rate instruments tied to CME Term SOFR, with rates generally ranging from 8.5% to 12.1%. Key holdings include a $4,953,689 term loan to Prestige Backyards LLC and a $4,565,558 term loan to Pediatric Home Respiratory Services LLC. The fund also has various delayed draw term loans and revolvers, indicating ongoing capital deployment. The filing indicates no established public market for its common shares, with 8,256,360 shares outstanding as of November 12, 2025.

Why It Matters

This filing provides a granular look into Manulife Private Credit Fund's investment strategy, heavily favoring senior secured loans in middle-market companies. For investors, the high concentration in variable-rate loans means sensitivity to interest rate fluctuations, offering potential upside in a rising rate environment but also risk if rates fall. The lack of a public market for its shares suggests this fund targets institutional or sophisticated investors, limiting retail access. The competitive landscape for private credit remains robust, and Manulife's focus on specific sectors like Industrials and Healthcare indicates a targeted approach to generating yield and managing risk within these niches.

Risk Assessment

Risk Level: medium — The fund's risk level is medium due to its significant concentration in senior loans, with 195.3% of its portfolio in this asset class. While senior loans are generally considered less risky due to their priority in capital structure, the substantial exposure to specific sectors like Industrials (74.2%) and Health Care (39.0%) introduces concentration risk. Furthermore, the reliance on variable-rate loans tied to CME Term SOFR means the fund is exposed to interest rate volatility, which could impact income if rates decline.

Analyst Insight

Investors should consider Manulife Private Credit Fund if they seek exposure to private credit and believe interest rates will remain elevated or rise further, benefiting its floating-rate portfolio. However, they should be aware of the illiquidity of its shares and the sector-specific risks, particularly in Industrials and Healthcare. Due diligence on the underlying credit quality of the numerous small to mid-sized borrowers is crucial.

Financial Highlights

debt To Equity

1.95

total Assets

$334,817,296

Key Numbers

• $334.8M — Senior Loans Value (Represents 195.3% of net assets, indicating significant leverage or a large portfolio relative to equity.)
• 74.2% — Industrials Concentration (Largest sector allocation, totaling $127.2 million, showing a focused investment strategy.)
• 39.0% — Health Care Concentration (Second largest sector allocation, totaling $66.9 million, highlighting another key investment area.)
• 8.5%-12.1% — Interest Rate Range (Typical floating rates on senior loans, indicating sensitivity to interest rate movements.)
• 8.26M — Common Shares Outstanding (As of November 12, 2025, with no established public market.)

Key Players & Entities

• Manulife Private Credit Fund (company) — registrant
• $334,817,296 (dollar_amount) — total value of senior loans
• 195.3% (dollar_amount) — percentage of senior loans to net assets
• $127,209,915 (dollar_amount) — value of industrials investments
• 74.2% (dollar_amount) — percentage of industrials investments
• $66,939,490 (dollar_amount) — value of health care investments
• 39.0% (dollar_amount) — percentage of health care investments
• CME Term SOFR (regulator) — benchmark for variable-rate loans
• 8,256,360 (dollar_amount) — common shares outstanding as of November 12, 2025
• SEC (regulator) — filing authority

FAQ

Risk Factors

• Interest Rate Sensitivity [high — market]: The fund's senior loans are predominantly variable-rate instruments tied to CME Term SOFR, with rates ranging from 8.5% to 12.1%. This exposes the fund to significant interest rate risk, where rising rates could increase borrowing costs for underlying companies, potentially impacting their ability to service debt, while falling rates would reduce the fund's income.
• Concentration Risk [high — market]: The portfolio exhibits significant concentration in specific sectors, with Industrials (74.2% or $127,209,915), Health Care (39.0% or $66,939,490), and Consumer Discretionary (42.4% or $72,727,222) representing substantial portions of the senior loans. Adverse developments in these sectors could disproportionately impact the fund's overall performance.
• Leverage and Net Asset Value [high — financial]: Senior loans totaling $334,817,296 represent 195.3% of net assets. This high leverage amplifies both potential gains and losses, making the fund's net asset value highly sensitive to the performance of its underlying investments and market fluctuations.
• Illiquidity of Investments [medium — market]: The fund's investments are in private credit, and there is no established public market for its common shares. This lack of liquidity means that selling assets to meet redemption requests or other cash needs could be challenging and may require selling at a discount.
• Capital Deployment and Delayed Draw Loans [medium — operational]: The fund holds various delayed draw term loans and revolvers, indicating ongoing capital deployment. Managing these commitments and ensuring timely and effective deployment of capital is crucial for generating returns and managing operational risk.

Industry Context

The private credit market continues to be a significant source of financing for middle-market companies, often providing more flexible terms than traditional bank lending. However, it is also characterized by increasing competition and a growing focus on specialized strategies like senior loans. The sector is sensitive to macroeconomic conditions, particularly interest rate movements and economic growth, which impact borrower creditworthiness and loan valuations.

Regulatory Implications

As a fund investing in private credit, Manulife Private Credit Fund is subject to various regulations concerning investment management, disclosure, and investor protection. Changes in financial regulations, particularly those affecting alternative investments or credit markets, could impact the fund's operations, compliance costs, and investment strategies.

What Investors Should Do

1. Monitor interest rate trends closely.
2. Assess sector concentration risks.
3. Evaluate the fund's leverage levels.
4. Consider the illiquidity of private credit investments.

Key Dates

• 2025-09-30: Quarter End — Reporting date for the consolidated financial statements, providing a snapshot of the fund's assets, liabilities, and performance for the period.
• 2025-11-12: Shares Outstanding Recorded — Indicates the number of common shares outstanding as of this date, relevant for per-share calculations and understanding ownership structure.

Glossary

Senior Loans

Loans that have a higher priority in the event of a borrower's bankruptcy or liquidation compared to other debt or equity holders. (These form the vast majority of the fund's assets, indicating its primary investment strategy is in secured, priority debt.)

CME Term SOFR

Chicago Mercantile Exchange Term Secured Overnight Financing Rate. A benchmark interest rate used for floating-rate loans. (The fund's loans are tied to this rate, making their income stream sensitive to changes in this benchmark.)

Delayed Draw Term Loan

A type of loan where the borrower can draw funds over a specified period, rather than receiving the entire amount upfront. (Indicates the fund is committed to future capital deployment, which requires ongoing management and liquidity planning.)

Revolver

A revolving credit facility that allows a borrower to draw, repay, and redraw funds up to a certain limit over a specified period. (Similar to delayed draw loans, these represent ongoing commitments and potential for future funding needs of portfolio companies.)

Cost Basis

The original value of an asset for tax purposes, usually the purchase price. (Comparing the cost basis ($334,636,390) to the current value ($334,817,296) shows a slight premium, suggesting the loans are trading at or slightly above par.)

Year-Over-Year Comparison

The provided 10-Q filing for September 30, 2025, does not contain comparative data from a previous filing (e.g., September 30, 2024) within the text provided. Therefore, a direct comparison of key metrics such as revenue growth, margin changes, or the emergence of new risks cannot be made based solely on this excerpt. Future analysis would require access to prior period filings to assess trends and changes in the fund's financial condition and performance.

Key Financial Figures

• $0.01 — hares of Beneficial Interest, par value $0.01 per share Indicate by check mark whet

Filing Documents

• d23438d10q.htm (10-Q) — 3941KB
• d23438dex311.htm (EX-31.1) — 8KB
• d23438dex312.htm (EX-31.2) — 8KB
• d23438dex321.htm (EX-32.1) — 4KB
• d23438dex322.htm (EX-32.2) — 4KB
• 0001193125-25-276918.txt ( ) — 15779KB
• ck0001988280-20250930.xsd (EX-101.SCH) — 1129KB
• d23438d10q_htm.xml (XML) — 4566KB

FINANCIAL INFORMATION

PART I. FINANCIAL INFORMATION 3

Consolidated Financial Statements (Unaudited)

ITEM 1. Consolidated Financial Statements (Unaudited) 3 Consolidated Schedule of Investments as of September 30, 2025 (Unaudited) and December 31, 2024 3 Consolidated Statements of Assets and Liabilities as of September 30, 2025 (Unaudited) and December 31, 2024 22 Consolidated Statements of Operations for the three and nine months ended September 30, 2025 and September 30, 2024 (Unaudited) 23 Consolidated Statements of Changes in Net Assets for the three and nine months ended September 30, 2025 and September 30, 2024 (Unaudited) 24 Consolidated Statements of Cash Flows for the nine months ended September 30, 2025 and September 30, 2024 (Unaudited) 25

Notes to Consolidated Financial Statements (Unaudited)

Notes to Consolidated Financial Statements (Unaudited) 26

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

ITEM 2. Management's Discussion and Analysis of Financial Condition and Results of Operations 43

Quantitative and Qualitative Disclosures about Market Risk

ITEM 3. Quantitative and Qualitative Disclosures about Market Risk 55

Controls and Procedures

ITEM 4. Controls and Procedures 56

OTHER INFORMATION

PART II. OTHER INFORMATION 56

Legal Proceedings

ITEM 1. Legal Proceedings 56

Risk Factors

ITEM 1A. Risk Factors 56

Unregistered Sales of Equity Securities and Use of Proceeds

ITEM 2. Unregistered Sales of Equity Securities and Use of Proceeds 56

Defaults Upon Senior Securities

ITEM 3. Defaults Upon Senior Securities 57

Mine Safety Disclosures

ITEM 4. Mine Safety Disclosures 57

Other Information

ITEM 5. Other Information 58

Exhibits

ITEM 6. Exhibits 59

SIGNATURES

SIGNATURES 60 Table of Contents

FINANCIAL INFORMATION

PART I. FINANCIAL INFORMATION

Consolidated Financial Statements (Unaudited)

ITEM 1. Consolidated Financial Statements (Unaudited) Manulife Private Credit Fund Consolidated Schedule of Investments 9-30-25 (Unaudited) Rate (%) Maturity date Par value^ Value Non-controlled/Non-affiliated Senior loans (A)(B) 195.3 % (Cost $ 334,636,390 ) $ 334,817,296 Consumer discretionary 42.4 % 72,727,222 Distributors 6.7 % All Glass & Window Holdings, Inc., Delayed Draw Term Loan (C) — 03-26-31 1,282,051 1,269,231 All Glass & Window Holdings, Inc., Revolver (C) — 03-26-31 769,231 761,538 All Glass & Window Holdings, Inc., Term Loan (1 month CME Term SOFR + 5.000 %) (D) 9.166 03-26-31 3,625,031 3,588,781 Eastern Communications Solutions, Inc., Revolver (C) — 12-30-30 1,031,519 1,021,203 Eastern Communications Solutions, Inc., Term Loan (3 month CME Term SOFR + 5.000 %) (D) 9.002 12-30-30 4,931,218 4,881,906 Diversified consumer services 21.5 % Capital Construction LLC, 3rd Amendment Term Loan (3 month CME Term SOFR + 5.750 %) (D) 10.196 10-22-26 411,614 406,469 Capital Construction LLC, Add-On Delayed Draw Term Loan (1, 3 and 6 month CME Term SOFR + 5.750 %) (D) 10.166 10-22-26 495,811 489,613 Capital Construction LLC, Add-On Term Loan (1 month CME Term SOFR + 5.750 %) (D) 10.130 10-22-26 324,090 320,039 Capital Construction LLC, Delayed Draw Term Loan (1 month CME Term SOFR + 5.750 %) (D) 10.130 10-22-26 1,125,226 1,111,160 Capital Construction LLC, Delayed Draw Term Loan A (3 month CME Term SOFR + 5.750 %) (D) 10.218 10-22-26 217,241 214,525 Capital Construction LLC, Delayed Draw Term Loan B (C) — 10-22-26 628,855 620,994 Capital Construction LLC, Revolver (C) — 10-22-26 508,039 501,688 Capital Construction LLC, Term Loan (1 month CME Term SOFR + 5.750 %) (D) 10.130 10-22-26 830,097 819,720 GarageCo Intermediate II LLC, Delayed Draw Term Loan (C) — 08-02-32 2,289,562 2,272,391 GarageCo Intermediate II LLC, R

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