We obviously have the benefit of our joint venture to kind of help there. But I think you should continue to expect us to be active there rotating into new deals or some of these other deals we’ll continue to self-liquidate or self-amortize.
Brian Gerson: Hey, Casey. Brian here. The other constraint is just non-EPC. ABS investments are usually non-EPC and we have to stay within the 30% bucket. And we also have the JV. So that’s a bit of a constraint, but as Dan mentioned, we can also put ABS into the JV to basically increase our buying power in non-EPC.
Operator: Our next question comes from Melissa Wedel of JPMorgan. Melissa, go ahead with your question.
Melissa Wedel: Wanted to touch on, I think it’s really a follow-up to the first question about sort of investment activity levels. Obviously, with some elevated repayment activity in the first quarter, we saw leverage in the portfolio come down a bit. Given it’s sort of middle of the target range right now, I’m curious how you feel about that level of sort of portfolio leverage, especially in the context of your comments about expecting portfolio company growth on the revenue side, and I think on the EBITDA side as well, to start to decelerate in the back half of the year.
Daniel Pietrzak: Yes. Thanks, Melissa, and good morning. I think we’re pretty comfortable with where we sit right now, right? We’ve historically given that kind of one to one and a quarter times range, with probably the midpoint of, or sort of the target, it kind of the 115. So maybe, slightly sort of below that. I think we like how much available liquidity we have. I think we like the maturity ladder we have on the liability side. I think we’re prepared to kind of operate within that range considering we have that level of dry powder. I think on to your other comment. I mean, I think like the overall, market has taken the view maybe almost too aggressively that that sort of the hard landing concept is removed from the equation.
And we’re in this more kind of soft-landing perspective. I think we are expecting some slowdown though, at the consumer side, more sort of broadly, which will impact some of the names here and maybe reduce that kind of year-on-year EBITDA growth. It is our job for these companies to be a little bit glass half empty, but we got a little bit of room to work on the leverage side and we’re in a good liquidity position, so we feel good about that.
Melissa Wedel: Okay, appreciate that. And then, following up on the funding there are a decent number of upcoming maturities. And you guys have done, have always approached your own security issuances as incredibly laddered and well diversified, but there are some maturities coming up in ’24 and ’25, given the rate environment and the spread environment? How are you thinking about sort of funding those upcoming maturities. And what’s the appetite for further diversification versus sort of using the available capacity on the revolvers? Thank you.
Daniel Pietrzak: No worries. And I think Steven may have touched on some of this, so Steven, if there’s something to add here, please do. But we did do that deal in November, essentially pre-funding the upcoming maturity in the summer. Obviously, we’ve got the $4.2 billion of available liquidity. We’ve got, I think 65% of our balance sheet is funded today from unsecured. I think you should expect us to be a very active issuer there and do that with some level of consistency, but also do it, in a bid on an opportunistic basis when markets are open. And then, I think we’ll also look at, other tools like, CLOs or sort of otherwise to make sure we’re kind of fully, diversified from a liability perspective. But Steven, anything you want to add there?
Steven Lilly: I think you covered it well.
Operator: Our next question comes from Robert Dodd with Raymond James. Robert, please go ahead with your question.
Robert Dodd: Morning, guys. Again, on the forward outlook in terms of, economic risk and macro risk, how much of that concern stems from overall demand revenue versus margins, right? But we’re hearing messages from some BDCs that, well, generally BDCs and a lot of software are seeing margins go up because software companies are slashing sales expense. But on your companies, how much of the kind of the cost-cutting or margin management tools have already been expended, so to speak, over the last several years? Because obviously it’s been a theme for a lot of companies for many years and are they running out of tools on that front, do you think?
Daniel Pietrzak: Yes, good morning, Robert. It’s a fair question. I mean, our biggest sector exposure is sort of software. We’ve just focused on the larger sort of software names that were more EBITDA-focused than recurring revenue sort of structures. I think we have seen out there that the ability to just blindly push through price has probably kind of abated and it’ll be more challenging just to do that. So I think that is one point and almost in line with I think what your thoughts are there. I think where we’ve seen probably the most or the most challenge in certain situations is when a company, when their kind of expense line is heavily driven by wages, right? Because the wage inflation remains a real sort of point out there when you couple that with just the higher rate environment and as we’ve talked about for multiple quarters now, we expect rates to remain higher for longer.
So those are probably a little bit more of the things we do have our eye on. So I think we’re mindful about that sort of revenue piece. I think that’s partly why we’re talking about expecting to see just kind of slower sort of EBITDA growth in the coming quarters.
Robert Dodd: Got it, thank you. And then just, the other point, I mean, activity levels in the second half of the year, obviously also a thing. Lots of expectation that, to the point you outlined, right? I mean, LPs want their money back. How is, in your opinion, is the bid-ask between buyers and sellers on the LP side, is that actually beginning to close or is, because that’s obviously been a factor why activity levels have remained low? And do you think that’s going to close sufficiently, say this year, for there to be a pickup, a material pickup in activity in the second half or are people still playing chicken on that side?
