Company: NMFCZ
Filing Date: 2025-08-04
Form Type: 10-Q
Source: 0001496099-25-000027
Chunk: 18

Company: New Mountain Finance Corp
Filing Date: 2025-08-04
Form: 10-Q
Item: Part I, Item 2
Chunk 18
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 underperformance and/or moderate market headwinds

◦Tier 2 – Significant business underperformance and/or significant market headwinds

◦Tier 1 – Severe business underperformance and/or severe market headwinds

•Business Characteristics assesses the health of the investment in context of the underlying portfolio company’s business and credit quality, the underlying portfolio company’s current balance sheet, and the level of support from the equity sponsor. The metric is expressed as on a qualitative scale of “A” to “C”, with “A” being the best and “C” being the worst.

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The Risk Rating for each investment is a composite of these two metrics. The Risk Rating is expressed in categories of Green, Yellow, Orange and Red, with Green reflecting an investment that is in-line with or above expectations and Red reflecting an investment performing materially below expectations. The mapping of the composite scores to these categories are below:

•Green – 4C, 3B, 2A, 4B, 3A, and 4A (e.g., Tier 4 for Operating Performance and C for Business Characteristics)

•Yellow – 3C, 2B, and 1A

•Orange – 2C and 1B

•Red – 1C 

The following table shows the Risk Rating of our portfolio companies as of June 30, 2025:

(in millions)As of June 30, 2025Risk RatingCostPercentFair ValuePercentGreen$2,888.4 92.4 %$2,858.0 94.8 %Yellow128.4 4.1 %89.4 3.0 %Orange88.7 2.8 %51.4 1.7 %Red21.9 0.7 %15.4 0.5 %Total$3,127.4 100.0 %$3,014.2 100.0 %

As of June 30, 2025, all investments in our portfolio had a Green Risk Rating with the exception of six portfolio companies that had a Yellow Risk Rating, seven portfolio companies that had an Orange Risk Rating and one portfolio company that had a Red Risk Rating.

During the second quarter of 2022, we placed our second lien positions in National HME, Inc. ("National HME") on non-accrual status. As of June 30,