Quarterly report [Sections 13 or 15(d)]

INVESTMENTS

v3.26.3
INVESTMENTS
 6 Months Ended
Sep. 30, 2026
Investments, Debt and Equity Securities [Abstract]  
INVESTMENTS INVESTMENTS
Fair Value
In accordance with ASC 820, the fair value of our investments is determined to be the price that would be received for an investment in a current sale, which assumes an orderly transaction between willing market participants on the measurement date. This fair value definition focuses on exit price in the principal, or most advantageous, market and prioritizes, within a measurement of fair value, the use of market-based inputs over entity-specific inputs. ASC 820 also establishes the following three-level hierarchy for fair value measurements based upon the transparency of inputs to the valuation of a financial instrument as of the measurement date.
•Level 1 — inputs to the valuation methodology are quoted prices (unadjusted) for identical financial instruments in active markets;
•Level 2 — inputs to the valuation methodology include quoted prices for similar financial instruments in active or inactive markets, and inputs that are observable for the financial instrument, either directly or indirectly, for substantially the full term of the financial instrument. Level 2 inputs are those in markets for which there are few transactions, the prices are not current, little public information exists, or instances where prices vary substantially over time or among brokered market makers; and
•Level 3 — inputs to the valuation methodology are unobservable and significant to the fair value measurement. Unobservable inputs are those inputs that reflect assumptions that market participants would use when pricing the financial instrument and can include the Valuation Team’s assumptions based upon the best available information.
When a determination is made to classify our investments within Level 3 of the valuation hierarchy, such determination is based upon the significance of the unobservable factors to the overall fair value measurement. However, Level 3 financial instruments typically include, in addition to the unobservable, or Level 3, inputs, observable inputs (or components that are actively quoted and can be validated to external sources). The level in the fair value hierarchy within which the fair value
measurement falls is determined based on the lowest level input that is significant to the fair value measurement. Investments in funds measured using NAV as a practical expedient are not categorized within the fair value hierarchy.
As of September 30, 2026 and March 31, 2026, all of our investments were valued using Level 3 inputs within the ASC 820 fair value hierarchy, except for our investment in money market funds, which was valued using Level 1 inputs, and our investment in Gladstone Alternative Income Fund ("Gladstone Alternative"), which was valued using NAV as a practical expedient.
We transfer investments in and out of Level 1, 2 and 3 of the valuation hierarchy as of the beginning balance sheet date, based on changes in the use of observable and unobservable inputs utilized to perform the valuation for the period. There were no transfers in or out of Level 1, 2 and 3 during the three and six months ended September 30, 2026 and 2025.
As of September 30, 2026 and March 31, 2026, our investments, by security type, at fair value were categorized as follows within the ASC 820 fair value hierarchy:
Fair Value Measurements
Quoted Prices in
Active Markets
for Identical
Assets
(Level 1)
Significant
Other
Observable Inputs
(Level 2)
Significant
Unobservable
Inputs
(Level 3)
 Fair Value
As of September 30, 2026:
Secured first lien debt
 $ —  $ —  $ 654,079  $ 654,079 
Secured second lien debt
 —  —  107,333  107,333 
Preferred equity
 —  —  484,076  484,076 
Common equity/equivalents
 — 

—  180,487  180,487 
Total $ —  $ —  $ 1,425,975  $ 1,425,975 
Investments measured at NAV (A)
—  —  —  4,890 
Total Investments
 $ —  $ —  $ 1,425,975  $ 1,430,865 
Cash equivalents 25  —  —  25 
Total Investments and Cash Equivalents as of September 30, 2026
 $ 25  $ —  $ 1,425,975  $ 1,430,890 

Fair Value Measurements
Quoted Prices in
Active Markets
for Identical
Assets
(Level 1)
Significant
Other
Observable
Inputs
(Level 2)
Significant
Unobservable
Inputs
(Level 3)
 Fair Value
As of March 31, 2026:
Secured first lien debt
 $ —  $ —  $ 570,602  $ 570,602 
Secured second lien debt
 —  —  99,197  99,197 
Preferred equity
 —  —  426,949  426,949 
Common equity/equivalents
 —  —  207,495  207,495 
Total $ —  $ —  $ 1,304,243  $ 1,304,243 
Investments measured at NAV (A)
—  —  —  5,005 
Total Investments $ —  $ —  $ 1,304,243  $ 1,309,248 
Cash equivalents 25  —  —  25 
Total Investments and Cash Equivalents as of March 31, 2026
 $ 25  $ —  $ 1,304,243  $ 1,309,273 
(A)Includes our investment in Gladstone Alternative as of September 30, 2026 and March 31, 2026. Investments that are measured at fair value using NAV as a practical expedient have not been categorized in the fair value hierarchy. The fair value amounts presented in this table are intended to permit reconciliation of the fair value hierarchy to the amounts presented elsewhere in this Quarterly Report.
The following table presents our investments, valued using Level 3 inputs within the ASC 820 fair value hierarchy, and carried at fair value as of September 30, 2026 and March 31, 2026, by caption on our accompanying Consolidated Statements of Assets and Liabilities, and by security type:
Total Recurring Fair Value Measurements
Reported in Consolidated Statements
of Assets and Liabilities
Valued Using Level 3 Inputs
September 30, 2026 March 31, 2026
Non-Control/Non-Affiliate Investments
Secured first lien debt $ 422,961  $ 374,285 
Secured second lien debt 104,933  97,397 
Preferred equity 316,370  304,782 
Common equity/equivalents 180,487  207,495 
Total Non-Control/Non-Affiliate Investments 1,024,751  983,959 
Affiliate Investments
Secured first lien debt 187,762  195,704 
Secured second lien debt 2,400  1,800 
Preferred equity 152,346  122,167 
Common equity/equivalents (A)
—  — 
Total Affiliate Investments 342,508  319,671 
Control Investments
Secured first lien debt 43,356  613 
Secured second lien debt —  — 
Preferred equity 15,360  — 
Common equity/equivalents —  — 
Total Control Investments 58,716  613 
Total investments at fair value using Level 3 inputs $ 1,425,975  $ 1,304,243 
(A)Excludes our investment in Gladstone Alternative as of September 30, 2026 and March 31, 2026 with a fair value of $4.9 million and $5.0 million, respectively, which was valued using NAV as a practical expedient.
In accordance with ASC 820, the following table provides quantitative information about our investments valued using Level 3 fair value measurements as of September 30, 2026 and March 31, 2026. The table below is not intended to be all-inclusive, but rather provides information on the significant Level 3 inputs as they relate to our fair value measurements. Significant Level 3 inputs were weighted by the relative fair value of the investments.
Quantitative Information about Level 3 Fair Value Measurements
Fair Value as of Valuation
Technique/
Methodology		 Unobservable
Input		 Range / Weighted-Average as of
September 30, 2026 March 31, 2026 September 30, 2026 March 31, 2026
Secured first
lien debt		 $ 654,079  $ 570,602  TEV EBITDA multiple
3.9x – 9.3x /
6.6x
3.6x – 8.7x /
6.4x
EBITDA
$206 – $25,204 /
$10,990
$430 – $28,973 / $11,991
Revenue multiple
0.4x – 0.6x /
0.4x
0.3x – 0.6x /
0.5x
Revenue
$18,379 – $90,572 /
$90,572
$21,768 – $99,974 / $62,789
Secured second
lien debt		 107,333  99,197  TEV EBITDA multiple
4.6x – 9.2x /
 7.8x
5.0x – 10.3x /
7.6x
EBITDA
$4,095 – $51,487 /
$29,796
$3,000 – $44,315 / $19,510
Preferred
equity		 484,076  426,949  TEV EBITDA multiple
3.6x – 9.3x /
6.0x
3.6x – 8.7x /
6.4x
EBITDA
$206 – $56,204 /
$20,994
$430 – $28,973 / $9,870
Revenue multiple
0.4x – 0.6x /
0.4x
0.3x – 0.6x /
0.4x
Revenue
$18,379 – $90,572 /
$90,572
$21,768 – $99,974 / $76,364
Common equity/
equivalents		 180,487  207,495  TEV EBITDA multiple
4.6x – 9.2x /
9.0x
5.0x – 10.3x /
9.0x
EBITDA
$2,287 – $51,487 /
$48,317
$1,210 – $44,315 / $32,353
Total $ 1,425,975  $ 1,304,243 

Fair value measurements can be sensitive to changes in one or more of the valuation inputs. Changes in discount rates, EBITDA or EBITDA multiples (or revenue or revenue multiples), each in isolation, may change the fair value of certain of our investments. Generally, an increase/(decrease) in market yields or discount rates or a (decrease)/increase in EBITDA or EBITDA multiples (or revenue or revenue multiples) may result in a significant (decrease)/increase in the fair value of certain of our investments.
Changes in Level 3 Fair Value Measurements of Investments
The following tables provide our portfolio’s changes in fair value, broken out by security type, during the three and six months ended September 30, 2026 and 2025 for all investments for which the Adviser determines fair value using unobservable (Level 3) inputs.
Fair Value Measurements Using Significant Unobservable Inputs (Level 3)

 Secured
First Lien
Debt		 Secured
Second Lien
Debt
Preferred
Equity
 Common
Equity/
Equivalents		 Total
Three Months Ended September 30, 2026:
Fair value as of June 30, 2026
 $ 564,631  $ 102,789  $ 429,510  $ 180,145  $ 1,277,075 
Total gain (loss):
Net realized gain (loss)(A)
—  —  —  —  — 
Net unrealized (depreciation) appreciation(B)
(4,578) 4,544  11,961  342  12,269 
Reversal of previously recorded depreciation upon realization(B)
—  —  —  —  — 
New investments, repayments and settlements(C):
Issuances / originations
 113,888  —  42,605  —  156,493 
Settlements / repayments
 (19,862) —  —  —  (19,862)
Sales
 —  —  —  —  — 
Transfers
 —  —  —  —  — 
Fair value as of September 30, 2026
 $ 654,079  $ 107,333  $ 484,076  $ 180,487  $ 1,425,975 
Change in unrealized (depreciation) appreciation attributable to investments still held at September 30, 2026
 $ (4,578) $ 4,544  $ 11,961  $ 342  $ 12,269 

Secured
First Lien
Debt		 Secured
Second Lien
Debt
Preferred
Equity
 Common
Equity/
Equivalents		 Total
Six Months Ended September 30, 2026
Fair value as of March 31, 2026
 $ 570,602  $ 99,197  $ 426,949  $ 207,495  $ 1,304,243 
Total gain (loss):
Net realized (loss) gain(A)
(9,000) —  —  —  (9,000)
Net unrealized (depreciation) appreciation (B)
(5,170) 7,536  14,522  (27,008) (10,120)
Reversal of previously recorded depreciation upon realization(B)
3,621  —  —  —  3,621 
New investments, repayments and settlements(C):
Issuances / originations
 113,888  600  42,605  —  157,093 
Settlements / repayments
 (19,862) —  —  —  (19,862)
Sales
 —  —  —  —  — 
Transfers
 —  —  —  —  — 
Fair value as of September 30, 2026
 $ 654,079  $ 107,333  $ 484,076  $ 180,487  $ 1,425,975 
Change in unrealized (depreciation) appreciation attributable to investments still held at September 30, 2026
 $ (5,170) $ 7,536  $ 14,522  $ (27,008) $ (10,120)
Secured
First Lien
Debt
Secured
Second Lien
Debt
Preferred
Equity
Common
Equity/
Equivalents
 Total
Three Months Ended September 30, 2025:
Fair value as of June 30, 2025
 $ 557,057  $ 93,340  $ 325,997  $ 55,341  $ 1,031,735 
Total gain (loss):
Net realized gain (loss)(A)
(29,938) —  —  —  (29,938)
Net unrealized (depreciation) appreciation(B)
(744) (2,707) 18,181  20,553  35,283 
Reversal of previously recorded (appreciation) depreciation upon realization(B)
19,104  —  —  —  19,104 
New investments, repayments and settlements(C):
Issuances / originations
 49,936  —  21,100  —  71,036 
Settlements / repayments
 (1,436) —  —  —  (1,436)
Sales
 —  —  —  —  — 
Transfers
 —  —  —  —  — 
Fair value as of September 30, 2025
 $ 593,979  $ 90,633  $ 365,278  $ 75,894  $ 1,125,784 
Change in unrealized (depreciation) appreciation attributable to investments still held at September 30, 2025
 $ (744) $ (2,707) $ 18,181  $ 20,553  $ 35,283 
Secured
First Lien
Debt
Secured
Second Lien
Debt
Preferred
Equity
Common
Equity/
Equivalents
 Total
Six Months Ended September 30, 2025:
Fair value as of March 31, 2025
 $ 514,334  $ 103,580  $ 302,163  $ 54,268  $ 974,345 
Total gain (loss):
Net realized gain (loss)(A)
(29,938) —  —  —  (29,938)
Net unrealized appreciation (depreciation)(B)
409  (2,331) 14,497  21,626  34,201 
Reversal of previously recorded (appreciation) depreciation upon realization(B)
19,104  —  —  —  19,104 
New investments, repayments and settlements(C):
Issuances / originations
 95,876  —  38,002  —  133,878 
Settlements / repayments
 (5,806) —  —  —  (5,806)
Sales
 —  —  —  —  — 
Transfers(D)
—  (10,616) 10,616  —  — 
Fair value as of September 30, 2025
 $ 593,979  $ 90,633  $ 365,278  $ 75,894  $ 1,125,784 
Change in unrealized appreciation (depreciation) attributable to investments still held at September 30, 2025
 $ 409  $ (2,331) $ 14,497  $ 21,626  $ 34,201 
Included in net realized gain (loss) on investments on our accompanying Consolidated Statements of Operations for the respective three and six months ended September 30, 2026 and 2025.
(B)Included in net unrealized appreciation (depreciation) of investments on our accompanying Consolidated Statements of Operations for the respective three and six months ended September 30, 2026 and 2025.
(C)Includes increases in the cost basis of investments resulting from new portfolio investments, the amortization of discounts and other non-cash disbursements to portfolio companies, as well as decreases in the cost basis of investments resulting from principal repayments or sales, the amortization of premiums and acquisition costs, and other cost-basis adjustments.
(D)Transfers represent secured second lien debt of PSI Molded Plastics, Inc. ("PSI Molded") with a total cost basis of $10.6 million, which was converted to preferred equity in June 2025.
Investment Concentrations
As of September 30, 2026, our investment portfolio consisted of investments in 31 portfolio companies located in 20 states and Canada across 16 different industries with an aggregate fair value of approximately $1.4 billion. Our five largest portfolio investments at fair value as of September 30, 2026 totaled $561.2 million, or 39.2%, of our total investment portfolio.
The following table summarizes our investments by security type as of September 30, 2026 and March 31, 2026:
September 30, 2026 March 31, 2026
Cost Fair Value Cost Fair Value
Secured first lien debt $ 678,035  57.4  % $ 654,079  45.7  % $ 593,008  56.3  % $ 570,602  43.6  %
Secured second lien debt 153,440  13.0  % 107,333  7.5  % 152,840  14.5  % 99,197  7.6  %
Total debt 831,475  70.4  % 761,412  53.2  % 745,848  70.8  % 669,799  51.2  %
Preferred equity 300,007  25.4  % 484,076  33.8  % 257,403  24.5  % 426,949  32.6  %
Common equity/equivalents 49,597  4.2  % 185,377  13.0  % 49,597  4.7  % 212,500  16.2  %
Total equity/equivalents 349,604  29.6  % 669,453  46.8  % 307,000  29.2  % 639,449  48.8  %
Total investments
 $ 1,181,079  100.0  % $ 1,430,865  100.0  % $ 1,052,848  100.0  % $ 1,309,248  100.0  %
Investments at fair value consisted of the following industry classifications as of September 30, 2026 and March 31, 2026:
September 30, 2026 March 31, 2026
Fair Value Percentage of
Total Investments		 Fair Value Percentage of Total Investments
Diversified/Conglomerate Services $ 258,676  18.1 % $ 189,148  14.4 %
Machinery (Non-Agriculture, Non-Construction, and Non-Electronic) 222,508  15.6 % 258,692  19.8 %
Aerospace and Defense 206,150  14.4 % 174,542  13.4 %
Home and Office Furnishings, Housewares, and Durable Consumer Products 175,903  12.3 % 166,553  12.7 %
Oil and Gas 116,883  8.2 % 125,605  9.6 %
Leisure, Amusement, Motion Pictures, and Entertainment 109,775  7.7 % 105,339  8.0 %
Electronics 68,479  4.8 % 62,723  4.8 %
Diversified/Conglomerate Manufacturing 65,848  4.6 % 6,763  0.5 %
Chemicals, Plastics, and Rubber 55,065  3.8 % 49,715  3.8 %
Buildings and Real Estate 51,810  3.6 % 68,987  5.3 %
Mining, Steel, Iron and Non-Precious Metals 44,438  3.1 % 37,713  2.9 %
Healthcare, Education, and Childcare 40,289  2.8 % 41,630  3.2 %
Other < 2.0% 15,041  1.0 % 21,838  1.6 %
Total investments $ 1,430,865  100.0 % $ 1,309,248  100.0 %
Investments at fair value were included in the following geographic regions of the U.S. and Canada as of September 30, 2026 and March 31, 2026:
September 30, 2026 March 31, 2026
Location Fair Value Percentage of
Total Investments		 Fair Value Percentage of
Total Investments
United States
South
 $ 631,988  44.2  % $ 649,436  49.6  %
West
 270,226  18.9  % 227,294  17.3  %
Northeast
 256,321  17.9  % 193,837  14.8  %
Midwest
 240,437  16.8  % 216,726  16.6  %
Canada 31,893  2.2  % 21,955  1.7  %
Total investments $ 1,430,865  100.0  % $ 1,309,248  100.0  %
The geographic region indicates the location of the headquarters for our portfolio companies. A portfolio company may have additional business locations or investments in other geographic regions.
Investment Principal Repayments
The following table summarizes the contractual principal repayment and maturity of our investment portfolio by fiscal year, assuming no voluntary prepayments, as of September 30, 2026:

Amount
For the remaining six months ending March 31, 2027
 $ 31,130 
For the fiscal years ending March 31:
2028 107,371 
2029 288,689 
2030 173,882 
2031 151,435 
Thereafter 78,968 
Total contractual repayments $ 831,475 
Investments in equity securities 349,604 
Total cost basis of investments held as of September 30, 2026:
 $ 1,181,079 
Receivables from Portfolio Companies
Receivables from portfolio companies represent non-recurring costs that we incurred on behalf of portfolio companies. Such receivables, net of any allowance for uncollectible receivables, are included in Other assets, net on our accompanying Consolidated Statements of Assets and Liabilities. We generally maintain an allowance for uncollectible receivables from portfolio companies when the receivable balance becomes 90 days or more past due or if it is determined, based upon management’s judgment, that the portfolio company is unable to pay its obligations. We write off accounts receivable when we have exhausted collection efforts and have deemed the receivables uncollectible. As of September 30, 2026 and March 31, 2026, we had gross receivables from portfolio companies of $3.7 million and $2.6 million, respectively. As of September 30, 2026 and March 31, 2026, the allowance for uncollectible receivables was $1.5 million and $1.4 million, respectively.