Morgan Stanley Direct Lending Fund (MSDL) investor relations material

Executive summary

• Net investment income per share was $0.45 in Q2 2026, down from $0.47 in Q1 2026, while earnings per share improved to $0.09 from ($0.05) sequentially.

• NAV per share declined to $19.50 from $19.81 in the prior quarter; regular dividend per share remained at $0.45.

• Portfolio fair value was $3.6 billion, diversified across 229 companies in 36 industries, with 93.1% in first lien investments.

• Share repurchases added $0.05 to NAV per share in the quarter, with 831,486 shares repurchased at an average price of $15.06.

• Capstone JV ramped up, contributing to NII and portfolio diversification, with 52.3% of capital commitments called.

Financial highlights

• Net investment income for Q2 2026 was $38.2 million ($0.45 per share); total investment income was $88.8 million.

• Total expenses rose to $50.6 million, mainly due to higher debt expenses and incentive fees.

• Net realized and unrealized losses per share were $(0.36), improved from $(0.52) in Q1 2026.

• Net asset value per share decreased to $19.50 at June 30, 2026, from $20.26 at December 31, 2025.

• Non-accruals increased to 2.9% of the portfolio at cost, with seven companies on non-accrual status.

Outlook and guidance

• Board declared a regular distribution of $0.45 per share, payable in October 2026.

• Management expects sufficient liquidity for near-term investing, with $71.6 million in cash and $1.47 billion in unused credit facility commitments.

• Focus remains on first lien, floating rate, senior secured loans to U.S. sponsor-backed middle market companies.

• Portfolio is considered well-positioned to navigate ongoing market headwinds, including elevated rates and geopolitical uncertainty.

• Dividend level is expected to be supported by NII and JV ramp-up, despite some quarter-to-quarter noise from credit issues.