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Introduction & Market Context
Carlyle Credit Income Fund (NYSE:CCIF) released its third quarter 2025 earnings presentation on August 19, highlighting the fund’s performance and portfolio positioning. The fund, which primarily invests in equity and junior debt tranches of collateralized loan obligations (CLOs), maintained its monthly dividend of $0.105 per share despite facing net asset value (NAV) pressure.
CCIF shares closed at $5.75 on August 19, representing a significant discount to the reported NAV of $6.51 per share. The stock declined 3.13% during regular trading hours and fell an additional 1.74% in after-hours trading.
The fund operates within Carlyle’s broader $465 billion global investment platform, with the Global Credit division managing $203 billion in assets. CCIF benefits from Carlyle’s 25+ years of experience in the CLO market, where the firm has invested approximately $50 billion across U.S. and European markets.
Quarterly Performance Highlights
For Q3 2025, CCIF reported net investment income (NII) of $0.19 per common share, with adjusted NII of $0.22 after accounting for amortization of offering costs. Core net investment income, which adjusts for CLO equity non-cash effective yield accounting, reached $0.35 per share.
The fund generated cash yield of 23.11% on CLO investment quarterly payments, translating to $0.55 of recurring cash flows per share. This included an additional $1.3 million in payments from called deals, though the presentation noted that 12% of the portfolio didn’t make payments due to resets, refinancings, and primary issuances.
As shown in the quarterly results summary:
The fund’s NAV per share stood at $6.51 as of June 30, 2025, after paying dividends of $0.315 per share during the quarter. The presentation revealed net realized and unrealized losses of $(0.33) per share, which contributed to the NAV pressure.
CCIF declared monthly dividends of $0.105 per common share for September, October, and November 2025, representing an annualized dividend rate of 22.07% based on the current share price.
Detailed Financial Analysis
The fund’s total investment portfolio had a fair value of $200.4 million as of quarter-end, excluding cash. During Q3, CCIF deployed $28.1 million in new CLO investments with a weighted average GAAP yield of 14.56%, while generating $16.2 million from sales.
The total portfolio maintained a weighted average GAAP yield of 15.11%, supporting the fund’s income generation. The financial performance summary provides a comprehensive view of the fund’s metrics:
Looking at the quarterly trend, CCIF has maintained consistent dividend payments while navigating fluctuations in investment income and portfolio valuations. The fund’s operating results over the past five quarters show the evolution of key financial metrics:
Portfolio Analysis
CCIF’s portfolio provides exposure to 1,491 unique underlying loan obligors across 2,054 loans, with the largest individual obligor representing just 0.50% of the portfolio. This broad diversification helps mitigate credit risk, with the top 10 obligors accounting for only 4.53% of the portfolio.
The underlying portfolio overview shows the distribution across asset types, reinvestment periods, CLO managers, and industries:
The portfolio maintains healthy credit metrics, with a weighted average loan rating of B+ and only 4.39% of obligors rated CCC (WA:CCCP) by S&P. The weighted average junior overcollateralization cushion stands at 4.50%, with no holdings having a cushion below 2.50%, indicating strong structural protection.
The detailed portfolio characteristics demonstrate the fund’s focus on senior secured loans with moderate credit risk:
Industry diversification remains a key strength, with the portfolio spread across multiple sectors. High Tech leads with 12.16% exposure, followed by Healthcare & Pharmaceuticals at 11.39% and Banking, Finance, Insurance & Real Estate at 10.60%:
Dividend Sustainability
CCIF’s dividend sustainability remains a focal point for investors. The fund has maintained its monthly dividend at $0.105 per share since November 2024, following increases from the initial $0.0551 monthly rate when distributions began in July 2023.
The current dividend appears well-supported by both core net investment income of $0.35 per share and recurring cash flows of $0.55 per share for Q3 2025. The presentation also projects approximately $0.51 per share of recurring cash flows for Q4 2025.
The monthly dividend trend illustrates the fund’s distribution history:
Strategic Initiatives
During Q3 2025, CCIF undertook several strategic capital initiatives. The fund converted $5 million of 7.125% Series B Convertible Preferred Shares into common shares and entered into a $30 million Credit Facility to enhance financial flexibility.
Additionally, CCIF sold 1.40 million common shares through its at-the-market (ATM) offering program, resulting in $0.01 per share NAV accretion. These actions reflect management’s efforts to optimize the capital structure while supporting portfolio growth.
The fund’s capital structure includes $75.5 million in preferred equity (principal balance) with no debt as of quarter-end. The Series A Term Preferred Shares (NYSE:CCIA) carry a BBB+ rating with an 8.75% coupon and mature in October 2028, with a call date of October 31, 2025.
Forward-Looking Statements
Looking ahead, CCIF’s management remains focused on maintaining the current dividend level, which is supported by the fund’s recurring cash flows and core net investment income. The presentation emphasized the underlying CLOs’ healthy overcollateralization cushions, suggesting confidence in the portfolio’s structural integrity.
The fund’s positioning within Carlyle’s broader credit platform provides access to significant resources, including 30+ industry-focused research analysts supporting CLO investments. This infrastructure may help CCIF navigate potential credit market challenges as the economic cycle evolves.
While the presentation didn’t explicitly address the discount to NAV at which the fund’s shares trade, the continued dividend payments at an annualized rate of 22.07% may attract income-focused investors seeking exposure to the CLO market through an established manager.
Full presentation:
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