Blue Owl Capital Corp Q3 FY2024 earnings call

• Strong third quarter results driven by continued portfolio performance and robust investment activity. - Achieved ROE of 12.4%, seventh consecutive quarter of double-digit ROE. - Net asset value per share was $15.28, near historical highs. - Non-accrual rate well below industry average. - Paid $0.05 per share supplemental dividend, base dividend coverage 127%. - Deployed over $9.5 billion across the platform in the quarter. - Acquired Atalaya Capital Management and announced acquisition of IPI Partners, expanding platform and deal flow. - Merger with OBDE expected to close in January 2025, streamlining platform, enhancing scale, and driving NII accretion.

Blue Owl Capital Corporation achieved a ROE of 12.4% for the third quarter, its seventh consecutive quarter of double-digit ROE. Net asset value per share was $15.28. Net investment income was $0.47 per share, down $0.01 from the prior quarter. First lien investments grew to 76% of the portfolio from 69% in the prior year. The non-accrual rate in the debt portfolio remained low at 70 basis points of fair value. The base dividend coverage was 127%, one of the highest among BDC peers.

• Base dividend expected to be covered throughout 2025; depending on rate cuts, may pay modest supplemental dividends. - Merger with OBDE is expected to drive NII accretion over near and long-term with opportunity for NAV per share accretion. - Confident in strong origination capabilities to maintain fully invested high-quality portfolio.

• Interest rate changes could impact earnings. - Market conditions and deal flow could affect origination activity. - Certain information discussed derived from third-party sources not independently verified.

Q: Question on yields and spreads for new deals A: Craig Packer stated spreads on new deals are around 4.75%, private markets offer 100-plus basis point premiums over public markets Q: Follow-up on Blue Owl platform expansion A: Craig Packer said acquisitions expand deal flow and create opportunities to put high-quality assets into BDCs with higher returns in alternative credit areas Q: Question on dividend and fee income cadence A: Craig Packer and Jonathan Lamm discussed variability in dividend income from underlying assets and fee income related to repayments varying quarter-to-quarter Q: Question on non-sponsored market A: Craig Packer said they do non-sponsored deals selectively, prefer sponsor-backed companies but will do non-sponsor for attractive opportunities with higher credit protection bar Q: Question on average commitment size and common equity investments A: Logan Nicholson said average commitment size was lower due to being at target leverage; Jonathan Lamm discussed strategic equity investments in combined company Q: Question on post-quarter rehash in SLF and unsecured mix A: Jonathan Lamm said no change in SLF strategy, moving assets in multi-BDC JV; discussed unsecured composition expected to have minimal material movement with refinancing opportunities