MLCI

Good morning, ladies and gentlemen. Thank you for standing by. Welcome to Mount Logan Capital's first quarter 2026 results conference call. Before we begin, I would like to remind listeners that today's discussion will include forward-looking statements. These statements discuss our current expectations and projections relating to our financial position, results of operations, plans, objectives, future performance, and business. These statements and other comments are not guarantees of future performance, but rather are subject to risk and uncertainty, some of which are beyond our control. These forward-looking statements apply as of today. You should not rely on them as representing our views in the future. We undertake no obligation to update these statements after this call. For a description of the risks associated with Mount Logan Capital's business, please see our most recent filings with the SEC.

In addition, we will be referring to certain non-GAAP financial measures during this call. Additional details and reconciliations of the GAAP to non-GAAP financial measures are in today's earnings release. This morning's conference call is hosted by Mount Logan's Chairman and Chief Executive Officer, Ted Goldthorpe, President Henry Wang, Chief Financial Officer Brandon Satoren, Executive Vice President and Chief Operating Officer Jordan Mangum, and Head of Investor Relations Scott Chan. As a reminder, all references to dollar amounts on this call are in U.S. dollars unless otherwise stated. I will now turn the call over to Mr. Goldthorpe. You may begin.

Thank you, good afternoon, everyone. Thank you for joining us today. On our fourth quarter call in March, I described 2025 as the foundational year for Mount Logan. We completed the combination of 180 Degree Capital, transitioned to U.S. GAAP reporting, and listed our shares on the Nasdaq. For 2026, our focus is on execution and converting that foundation into recurring revenue growth and improved profitability across the platform. This first quarter financial performance represents small but important early validation of that strategy. Notably, segment income increased 41% year-over-year to $3.3 million. Spread-related earnings returned to a positive $2 million contribution, and fee-related earnings of $1.2 million reflect a meaningful improvement in underlying earnings quality as one-time items in the prior period roll off and incremental assets begin to contribute.

We expect the accelerated momentum in earnings during the second half of 2026 and as we progress into 2027. We are also pleased to announce that we are paying our 27th consecutive quarterly dividend as a listed company, which consists of $0.03 per share distribution for shareholders of record as of May 26, 2026. Before we move into the business update, we felt it was very important to first address performance across our core managed portfolios, which provides the foundation for our growth narrative. We built our private credit franchise with the goal of being able to invest across all market cycles and environments and believe performance within the vehicles we manage reflect that.

On the insurance investment portfolio, we generated a 6.8% yield in the first quarter, or 7.5% excluding funds withheld, a significant improvement quarter-over-quarter, reflecting full deployment and ongoing portfolio rotation into higher-yielding assets, which contributed to the positive swing in SRE of $3.1 million quarter-over-quarter. The opportunistic credit interval fund, or SOFIX, generated a return of 10.1% over the trailing 12 months ended March 31, 2026, and 1.1% year to date. SOFIX remains a differentiated interval fund, and the vehicle's diversification and unique investment orientation position it well to absorb market volatility we observed late in the quarter.

At BCP Investment Corporation, managed by Sierra Crest Investment Management, in which Mount Logan owns a 24.9% economic interest, non-accruals improved to 6.2% of the portfolio at amortized cost, down from 7.1% in the prior quarter. The debt portfolio remains highly diversified across 72 portfolio companies and 33 industries, with 81% in first lien loans and a weighted average yield of 12.8%, excluding non-accruals and CLO income. Like our peers in private credit, we observed pressure in software related credit valuations in the first quarter, driven primarily by liquid market volatility and AI related uncertainty rather than fundamental credit deterioration. Our managed portfolios have limited exposure to large, broadly syndicated software credits.

The exposure we do hold is concentrated in mission-critical, vertically specialized businesses, generally lower middle market, originated with first-lien seniority and meaningful equity cushions. Underlying revenue and cash flows across these positions remain healthy. We view any further dislocation in the sector as a source of opportunity for our opportunistic credit strategies, not a structural risk to our managed book. With that context, I will use the balance of my remarks to provide updates on several strategic actions announced during the quarter. As we announced in March, one of our core asset management vehicles, SOFIX, entered into a definitive agreement to acquire the assets of the Yieldstreet Alternative Income Fund managed by Willow Well. The transaction is expected to nearly double SOFIX net assets, adding over $100 million to the fund.

It also has the potential to contribute an incremental $2.8 million of FRE annually to Mount Logan, which represents approximately 30% growth over our 2025 FRE. The transaction is expected to be immediately accretive to our earnings per share once closed. We currently expect the transaction to close in the third quarter of 2026, subject to regulatory and Yieldstreet AIF shareholder approvals. We believe this is an important step in scaling our asset management platform and increasing our recurring fee-related earnings. We also believe the current environment in private credit may create additional opportunities for disciplined, well-capitalized companies like Mount Logan to acquire strategic assets at attractive valuations. The second item I want to highlight is the addition of approximately $120 million of managed assets from an existing relationship which became effective during March.

We expect these additional assets to contribute approximately $500,000 of incremental fee-related earnings in 2026, with the potential to contribute more than $1 million of incremental FRE in 2027. This addition reflects the depth of trust with an existing partner, the strength of our investment capabilities, and our ability to expand mandates with limited incremental infrastructure. A pattern we expect to replicate as the platform scales. Together with the Yieldstreet transaction, these actions are expected to add approximately $20 million of incremental managed assets to our platform this year. We believe these additions will expand recurring FRE, strengthen the earnings base of the company, and contribute to improved profitability as we move through 2026 and into 2027. Along similar lines, we remain highly focused on growing our insurance segment and its permanent capital base.

We view controlled liability origination and product innovation as core to building durable spread-related earnings. We've made meaningful investments in Ability's team, infrastructure, and balance sheet to progress towards our goal of becoming a direct insurer of retirement solutions, and we hope to provide updates on this initiative in the coming months. We believe this transition could drive a meaningful step-up in long-term earnings power of the insurance segment, as well as drive an increase in fees earned by Mount Logan Management for its effort in managing Ability's investment portfolio. Lastly, we wanted to quickly touch on our capital markets activity during the first quarter. In January, we took advantage of favorable market conditions and completed a $40 million senior unsecured note offering.

It extended our maturity profile at what we believe is an attractive fixed rate of 8%, reduced secured indebtedness, and provides additional and future flexibility as we access the new source of capital. Consistent with our stated capital allocation framework, we closed a $15 million tender offer during the quarter. Subsequent to the tender, our board authorized a new $10 million share repurchase program through December 2027. This authorization gives us continued flexibility to return capital opportunistically when we believe our shares do not reflect intrinsic value of the business. We are actively evaluating the most efficient manner to execute on the announced program, which may include affiliate or insider participation, and we look forward to updating investors on this initiative in the coming weeks.

Taken together, each of these initiatives are designed to expand recurring revenue, strengthen earnings quality, improve profitability, and increase investment in our business. With that, I will turn the call over to Brandon Satoren to review the financial results in more detail.

Thanks, Ted. Good afternoon, everyone. I'm excited to join Mount Logan as Chief Financial Officer, and I appreciate the opportunity to speak with investors on my first earnings call in this role. While I am new to the Mount Logan CFO position, I have been closely connected to the Mount Logan platform and its strategy through my role as CFO of our retail credit platform, which includes all of the public vehicles on the BC Partners and Mount Logan management credit platforms. That experience, coupled with more than 15 years working with and managing public companies, I believe positions me well to help grow and scale this business over time. Importantly, it's very clear to me that Mount Logan has created a truly differentiated business model for an entity of its size that combines an asset-light alternative asset management platform with an integrated insurance solutions and permanent capital vehicles.

With that in mind, I look forward to engaging directly with Mount Logan shareholders and the investment community as we work hard to enhance our financial performance and build long-term value. With that, I want to review our first quarter financial results in more detail. For the first quarter of 2026, total revenue was $10.6 million, up approximately 7% quarter-over-quarter. We reported a post-tax net loss of $6 million for the quarter, or an 85% improvement from last quarter. The significant decrease in the net loss was a result of a large non-recurring, non-cash goodwill impairment charge the company incurred during the prior quarter, which is now behind us.

Looking at our segment results, asset management revenue for the first quarter of 2026 was $2.5 million, compared to $3.1 million in the fourth quarter of 2025. However, the company's earnings quality improved significantly as the decline from the prior quarter was primarily driven by an outsized non-recurring transaction fee of $0.8 million earned in the prior quarter. Near term, we expect core management fees to continue to increase. However, these increases will likely be partially offset by the wind down of certain non-core legacy vehicles, including the AIF funds and CLOs. With that in mind, we are beginning to replace legacy revenues with new, more scalable and predictable fee streams.

This includes our profit-sharing arrangement with the majority owner of Sierra Crest Investment Management, the addition of over $100 million of assets from the Yieldstreet Alternative Income Fund, and the benefit of the $120 million of managed assets from an existing relationship, as well as higher transaction and advisory fees. We are beginning to see the contributions from these initiatives in 2026 and expect them to become more visible in our financial performance as the year progresses.Turning to Insurance solutions, net investment income, including investment income from our consolidated variable interest entities, was $20.2 million in the first quarter of 2026, or an increase of $1.7 million or 9% from the fourth quarter of 2025.

Excluding funds withheld and including the intercompany elimination of management fees, net investment income for the first quarter of 2026 increased 8% to $14.6 million compared to the prior quarter. The investment portfolio generated a 6.8% yield or 7.5% excluding funds withheld. And our insurance AUM increased to almost $1 billion, benefiting from the Vista IMA agreement announced during the first quarter of 2026 to manage an additional $120 million of assets. This represents an increase in yield of approximately 50 basis points on the investment portfolio quarter-over-quarter, and approximately 20 basis points when excluding funds withheld.

Ability's total assets managed by Mount Logan, excluding funds withheld, were $699.4 million as of March 31, 2026, an increase of $38.7 million from the fourth quarter of 2025. During the quarter, we continued to focus on optimizing and high-grading the insurance portfolio via prudent and thoughtful portfolio re-rotation and deployment, as well as ensuring the portfolio was fully deployed to drive spread earnings for our shareholders. Finally, I couldn't be more excited about the potential for Mount Logan to begin direct underwriting Ability Insurance products, as Ted mentioned in his prepared remarks. This initiative has the potential to have a transformative impact on the economics of both our insurance and asset management segments as it and the earnings power of our balance sheet via the organic growth engine it will provide.

Looking at core earnings, fee-related earnings or FRE were $1.2 million for the first quarter of 2026 compared to $1.5 million in the fourth quarter of 2025. Again, as I noted previously, while the headline number decreased marginally, the earnings quality improved dramatically as the prior quarter's FRE included the benefit of that non-recurring transaction fee of $0.8 million. Management fees, incentive fees, equity investment earnings, and other fee income increased by $0.4 million. This was primarily driven by the increase in fees from insurance solutions as well as our exposure to BCP Investment Corporation. Looking ahead, we expect FRE will continue to improve as we execute on the strategic initiatives Ted laid out in his remarks.

Spread-related earnings, or SRE, was $2 million for the first quarter of 2026 compared to a spread-related loss of $1.1 million for the fourth quarter of 2025. The significant quarter-over-quarter improvement in SRE was primarily driven by higher net investment income from deployment of cash into higher yielding assets and repositioning from non-performing assets to performing assets. A lower cost of funds that was impacted by a small favorable in-force updates within the long-term care block of $0.3 million compared to the prior quarter, which observed a $1.9 million unfavorable experience adjustments.

As Mount Logan continues to scale its insurance investment assets and earnings base, management expects the long-term care run-off block to represent a progressively smaller contributor to overall insurance earnings volatility. Finally, moving on to our balance sheet. Mount Logan's capital position as of March 31st, 2026 remains strong, with approximately $72.8 million of cash restricted cash and cash equivalents on hand, with virtually no near-term debt maturities. Further, as Ted noted, we successfully closed an investment-grade $40 million public bond issuance, which was largely used to refinance existing, more expensive legacy secured debt. This transaction not only significantly termed out our debt capital structure and meaningfully lowered the company's cost of financing, it also provides meaningful incremental financial flexibility as a result of replacing the legacy secured debt, which had onerous financial covenants with unsecured investment-grade public debt.

Finally, as Ted mentioned earlier, the board approved a dividend of $0.03 per share for the quarter, continuing our 27 consecutive quarters of dividends. Looking ahead, expense discipline and operational efficiency remain priorities across the platform. Recurring revenue streams are building, several one-time headwinds are largely behind us, and our pipeline of growth initiatives is accelerating. While we are still in a period of active repositioning, the directional picture for both FRE and SRE has clearly improved from where we exited 2025. We believe the actions we are taking today position Mount Logan for stronger recurring earnings, improved profitability, and greater shareholder value creation. With that, I will turn the call back over to Ted.

Thank you, Brandon. Before we open the call for questions, I just want to reemphasize the durability of the model that we are building. Mount Logan operates as an integrated platform across scalable asset management business with a disciplined private credit franchise and a permanent insurance platform and capital base. The business is designed to compound recurring earnings across market cycles. As scale within the platform expands and as our newly contracted fee streams begin to convert to the reported earnings, we believe we have a meaningful runway for profitability improvement and long-term shareholder value creation. That concludes our prepared remarks. Operator, if you could please open the call for questions.

Thank you. If you would like to ask a question, please press star one one on your telephone keypad. You will be advised when to ask your question. One moment for questions. Our first question comes from George Stroukoff with BMO Wealth Management. You may proceed.

Good afternoon, Ted. A couple of quick questions for you. On the last call, I believe you mentioned the potential for some additional mortgage related activities in Q1 and throughout the year. What are you seeing on that front?

Good, good question. So we inherited a large legacy book of mortgages and real estate assets, and we've done a really big cleanup in the first quarter. We repositioned a lot of our legacy mortgage exposure, and it has the impact, a couple different impact. One is we're replacing non-yielding REO with yielding assets, so there's less drag on portfolio yields. It reduces our earnings volatility, and again, will really help normalize our SRE over time. It's actually a really good transaction for Mount Logan, and it's something you'll see in our earnings in the next couple of quarters.

In your prepared remarks, you talked about the spreads in the software space and, you know, overall private credit. Obviously, there's been some challenges in it. Can you talk about the potential or the, you know, given how the strong balance that you talked about earlier, what's the opportunity for SOFIX and managed portfolio? You know, are you seeing good opportunity to deploy cash or you're still on the sidelines on that front?

Yeah, I'd say, I mean, well, we're being relatively prudent, but I'd say it's a really interesting environment because if you look at liquid credit markets, which are impacted by the same credit-related factors as private markets, spreads are all-time tights. High yield is trading tighter today than before the Iran war. You know, leverage loan spreads are at, you know, near term tights. In the private markets, mostly given by the fear that's being created by headlines, you know, there's been elevated redemptions and slowdowns in fundraising. We actually have seen some spread widening in our, in our core business, and that is very, very good for new originations. I would say our pipeline is mediocre. Like, deal activity feels like it's slowed down a little bit.

The deals we are doing tend to be higher, better risk-adjusted returns than what we were doing six to 12 months ago. It's definitely good for SOFIX.

Thank you very much.

Thank you.

Thanks.

Our next question comes from Greg Chan with Empire Life Investments. You may proceed.

Thanks for taking my question today. I have two. The first one, just on the direct MYGA direct writing strategic priority, the multi-year and guaranteed annuity market has become increasingly competitive as more platforms enter the space. Can you help us understand what differentiates Ability and what the potential distribution strategy would look like?

Yeah, really good question. You know, that business has definitely become more challenged over time as people have copied the playbook of some of the original alternative asset manager strategies. You know, again, like we've been reinsuring other people's liabilities, and we think the path to success for us is to find our own policies. We're not pursuing a highest rate strategy. You know, if you price the highest, you'll get more flow. We're very focused on matching our origination with our investment capabilities. We expect this to kinda, When we start direct writing, which will probably be sometime in the third quarter, we think this will lead to lower cost of capital. We'll get higher ROEs and, you know, a little bit more control over originations. Like, we can match investment deployment with our liability origination.

Great. Thank you. My second one is just for Brandon Satoren. As you settle into the CFO role, what areas are your initial priorities and focus points?

Sure. First and foremost, I think the my number one priority during these early days of my tenure, is getting my arms around capital management and our expense profile. Disciplined expense and capital management, I think are critical for the future viability and success of Mount Logan Capital. Second would be improving earnings quality, stability, and scalability. Very much focused on continuing to grow our insurance invested assets and optimizing our balance sheet. Driving more stable and recurring spread-related earnings over time, and then further aligning Mount Logan's earning profile with the broader insurance integrated alternative asset management peers that we are comp to. I would say the third leg is really strategic growth execution.

Notably because I wear both hats now as CFO of Mount Logan Capital, as well as CFO of a number of our core products, pursuing opportunities across insurance solution, retail credit products, and opportunistic M&A, is a critical initiative for myself. I'm fortunate to be able to shepherd both the vehicles as well as Mount Logan Capital through these potential strategic M&A growth opportunities. I would say those are my top three initial priorities, you know.

Okay. Thanks, thanks for the time today.

Thank you. Our next question comes from Charles Burns with CIBC WG.

Hi, Ted. How are you?

How are you?

I'm pretty good. Pretty good. Just a couple questions. It looks like the interest rate backdrop has definitely changed from lower rates to static rates to potentially higher rates. Just wondered what higher rates would the impact on Mount Logan's business, both the asset management and the insurance segments.

Yeah, really good question. We've been kind of warning for a long time that the biggest risk in the market that no one's factored in was higher rates. Everybody was wondering how fast rates were gonna get cut, and how much they would get cut. No one was talking about, you know, higher rates. Obviously, a lot of the even pre the Iran situation, a lot of the things that we've been doing as a country are inflationary, whether that's deficit spending or, you know, other tariffs and other things. These are all inflationary. What it means for us is our platform is very well set up for this. Our most of our assets, almost all of our assets are floating rate risk.

In all of our vehicles, higher short-term rates definitely flow right through to income, and part of our liability structure is fixed. Higher rates are definitely good for most of our vehicles. In insurance, technically we're hedged. You know, we're asset liability matched, there shouldn't be a huge impact on insurance. Absent a huge default cycle, which obviously, you know, could happen if rates go higher, it's definitely positive for our business.

Okay. The second one is the buyback that you announced. Have you executed anything on the buyback? Are you looking at other, I think you'd mentioned in your opening comments, other things that you can consider to kind of narrow the gap between what the underlying business is worth and what the market seems to be valuing the business currently?

Yeah, I mean, we got caught a little bit in that air pocket post-tender. You know, obviously there's a lot of headwinds given all the headlines around private credit for the large alternative asset managers. You know, what I'd say is this is the weird time of year. The short answer is we have not started executing our buyback program 'cause this is the weird time of year where we're in blackout basically for the first couple months of the year because our annual statements, which are March 31st, you know, don't come out till like, you know, about a month ago, and then now we're out again. We've been kind of blacked out. Listen, we are very, very focused on where our stock price is, you know.

I think there's a lot of things we can do away from just execution to enhance shareholder value. You know, I'd say you've seen us do it in the past, whether it's insider buying, whether it's tenders, whether it's other people buying our stock. I think we're focused on everything right now in order to take advantage of where our stock price trades.

Okay. The final one is the earnings variability, you know, switching to U.S. GAAP. I thought that was gonna kinda limit the variability, but it doesn't seem to be in the reported earnings. Still seems to be some significant swings. That gets back to how's the company analyst valuing the company with these earnings subject to so much variability.

Yeah, good question. I mean, I'll go first. Then Brandon Satoren and Scott Chan can jump in as well. What I'd say is, I mean, the variability historically has been around our insurance company. Under IFRS, there's big swings in the way our insurance company reports earnings. Obviously under GAAP, a lot of that's mitigated. For example, you know, interest rate changes, we used to have to mark to market our entire balance sheet. Now it largely flows through the balance sheet, not the income statement. The insurance company's results are gonna be a lot more stable. The volatility that you're seeing, actually a lot of it has to do with, you know, idiosyncratic issues. Like, for example, last quarter, we booked a one-time gain that flowed through FRE. This quarter, we didn't have the one-time gain.

Our FRE quality is way higher this quarter, despite the, you know, what looks like volatility. Same thing on SRE. You know, our SRE is up pretty dramatically, driven by our insurance team kind of doing a bunch of things internally. Again, it looks like there's earnings volatility, but it's really related to a couple kind of key things. You know, mostly portfolio rotation. We spend a lot of time, like Brandon mentioned earlier, we've identified a lot of cost takeouts we can do. We're hoping our earnings volatility will not be as pronounced as they've been historically. From the analyst perspective, you know, again, I think we spent a lot of time with the analysts walking them through what is true core operating results versus, you know, accounting volatility.

Yeah. I would just, you know, add on to that. You still are seeing some of the, you know, the tail end of, you know, our listing in the U.S., you know, transition to U.S. GAAP, et cetera, some of those costs flowing through the financials. You know, it's also important to keep in mind we did a large bond offering and a tender offer which came with one-off expenses and an extinguishment loss on our the debt we retired. I, you know, all in, I would say that contributed to about $2 million worth of incremental volatility outside of the sort of ordinary course run rate, OpEx, and operating performance during the quarter.

Chuck, it's Scott here. Maybe I'll add one more thing. If you take into consideration, the portfolio right now as of Q1, it was 51% net MYGA and 49% U.S. long-term care. That proportion continues to favor MYGA. As we continue to grow that portfolio, we'll see less volatility in the on the LTC side, as we move ahead.

Okay. Thanks very much. Look forward to the back half of this year and the improvement and growth.

Right. Thanks, Chuck.

Thank you. There are currently no questions in queue. Please be reminded if you would like to ask a question, please press star one one on your keypad now. One moment for questions. There are no further questions, so I will hand you back to your host to conclude today's conference.

Thank you all for your time today. As always, please feel free to reach out to us with any questions. We're always happy to discuss. We look forward to speaking to you again in August when we announce our second quarter 2026 results. Thank you so much and have a good weekend.

Thank you. This concludes the conference. Thank you for your participation. You may now disconnect.

Good afternoon, ladies and gentlemen, and thank you for standing by. Welcome to Mount Logan Capital's fourth quarter and full year 2025 results conference call. Before we begin, I would like to remind listeners that today's discussion will include forward-looking statements. These statements discuss our current expectations and projections relating to our financial position, results of operations, plans, objectives, future performance, and business. These statements and other comments are not guarantees of future performance, but rather are subject to risk and uncertainty, some of which are beyond our control. These forward-looking statements apply as of today, and you should not rely on them as representing our views in the future. We undertake no obligation to update these statements after this call. For a description of the risk associated with Mount Logan Capital's business, please see our most recent filings with the SEC.

In addition, we will be referring to certain non-GAAP financial measures during this call. Additional details and reconciliations of GAAP to non-GAAP financial measures are in today's earnings release. This afternoon's conference call is hosted by Mount Logan's Chairman and Chief Executive Officer, Ted Goldthorpe, President Henry Wang, Chief Financial Officer Nikita Klassen, and Head of Investor Relations Scott Chan. As a reminder, all references to dollar amounts on this call are in U.S. dollars unless otherwise stated. I will now turn the call over to Mr. Goldthorpe. You may begin.

Thank you. Good afternoon, everyone. Thank you for joining us today. 2025 was an active year across Mount Logan's platform, so I wanted to start by stepping back and telling you what this past year has represented, because the significant actions we took over the last year can get lost in a single quarter's results. A year ago, Mount Logan Capital was a Canadian-domiciled IFRS reporting company traded on the Cboe Canada. Today, we are a U.S. domiciled, Nasdaq-listed GAAP reporting and investment-grade alternative asset management and insurance solutions platform with $2.1 billion in assets under management. We are one of the very small number of public companies to combine asset management and insurance solutions businesses into a complementary platform at scale with a focus on credit investing. This foundational structure of our business did not happen by accident.

It was a product of an extraordinary team effort across every function of our organization during 2025, as well as the many years leading up to it. While there's volatility in the financial results during 2025, including one-time costs to complete our business combination with 180 Degree Capital, we believe the successful execution of our strategic priorities in 2025 sets the foundation for what we expect to be a much cleaner compounding earnings profile going forward. With the combination of 180 Degree Capital behind us, our team immediately got to work on focusing on the next phase of our growth journey. This morning's announcement of the Yieldstreet transaction that, once closed, is expected to drive material AUM growth in one of our managed funds and thus increase FRE through Mount Logan. This is the first proof point of what our platform can produce.

Concurrent with the release of our earnings, we announced that one of our core asset management vehicles, the Opportunistic Credit Interval Fund, or SOFIX, has entered into a definitive agreement to acquire the assets of the Yieldstreet Alternative Income Fund managed by Willow Asset Management. This is Mount Logan Capital's first strategic AUM acquisition since the closing of 180 Degree Capital as a direct expression of the growth strategy we've outlined at the time of that transaction. The deal will nearly double SOFIX net assets, adding over $100 million to the fund. Scale and permanent and semi-permanent capital vehicles is an important competitive advantage in the retail marketplace. Lower expense ratios increase portfolio diversity with limited overlapping investments and a larger fund size to support distributions. This transaction delivers all three. The acquired portfolio is also an excellent fit within our broader credit investing framework.

The assets are heavily weighted towards specialty finance and asset-based credit, cash flowing, diversified, and complementary to SOFIX existing holdings. This is exactly the credit exposure we want to grow within SOFIX to continue to grow the fund. We estimate the transaction will increase Mount Logan's FRE by at least $2.8 million annually, more than 30% growth for our 2025 FRE. The transaction is expected to be immediately accretive to our earnings per share once closed. I also want to note how we structured the consideration. A portion of the acquisition value will be a newly issued MLCI common stock that will be subject to lockup for two years from closing of the transaction. This reflects something we think is important for our company, important asset for our company, our Nasdaq listing and our equity currency.

The ability to use our stock in a disciplined manner as consideration in accretive and strategic transactions is a component for how we intend to grow efficiently going forward, and this transaction is the first example of that action. We expect the transaction to close in late Q2 or Q3 2026, subject to regulatory and Yieldstreet AIF shareholder approvals. As we look at future M&A opportunities, we expect the recent headlines around private credit will provide disciplined, well-capitalized companies like Mount Logan with the potential to add highly strategic assets at attractive valuations. We believe volatility and uncertainty create additional opportunities for our platform. These trends are supported by our experienced management team, the strong backing and alignment of BC Partners, and a proven ability to pursue and close highly accretive permanent and semi-permanent capital acquisitions to scale our AUM book base while unlocking fund level synergies.

We've been leaders in executing these type of opportunities since Mount Logan Capital's founding in 2018, and we believe we are viewed as an ideal partner in the private credit consolidation marketplace. Returning to our 2025 business achievements, I want to walk through the key milestones to provide a clear picture on what our platform looks like as we exited the year. In addition, there have been several subsequent items after the fourth quarter, which further demonstrate the unique nature and embedded value within our platform and the positive tailwinds we are experiencing. First, during 2025, we completed the transformational combination with 180 Degree Capital. This transaction took approximately nine months from signing to closing.

It included a conversion from U.S. to U.S. GAAP from IFRS proxy processes in the U.S. and Canada, redomiciliation to the U.S., and a transition of our listing to the Nasdaq under the ticker MLCI. Following the closing of the combination, Mount Logan entered into a new staffing agreement with BC Partners to create a true asset-light entity that is fully aligned with BC Partners, a $40 billion global alternative asset manager. Secondly, we focused on scaling our BDC ecosystem. This included the January 2025 closing of a minority investment in Runway Growth Capital LLC, giving us exposure to a $1 billion+ permanent capital vehicle focused on venture lending, an area where we previously held limited expertise.

In October, it was announced that Runway would be merging with SWK Holdings, significantly increasing the AUM and FRE of Runway, while providing further diversification into healthcare and life sciences lending. During July 2025, Portman Ridge and Logan Ridge, the two other BDCs within our ecosystem, merged to create BCP Investment Corporation, or BCIC. Today, BCIC is a larger, more efficient vehicle, with Sierra Crest Investment Management now advising a significantly scaled BDC. Mount Logan Capital, through our minority stake in profit-sharing interest in Sierra Crest, are expected to accrete to the benefit of our FRE base in 2026. These examples demonstrate our focus on consolidation across our funds to benefit shareholders of Mount Logan and the managed vehicles themselves. Finally, we made significant investments into our organic growth engine, Ability Insurance Company.

We invested a meaningful portion of the proceeds received from the turnover in the legacy 180 Degree Capital portfolio to enhance Ability's capital base in support of our efforts to expand our suite of insurance capabilities during 2026. This investment was both strategic and financial. It positions Ability to take on additional volume and underpins our longer-term ambition to move Ability towards direct insurance writing, not just reinsurance. We believe this strategy will be more capital efficient and accretive to margin over time. It will benefit investors via improved spread earnings and drive AUM growth that we control. During 2025, we also continued to add new reinsurance business by a new treaty relationship, and we are constantly evaluating additional reinsurance partners and product diversification opportunities to benefit policyholders.

The long-term care block remains stable, although we wrote down a meaningful portion of this legacy part of the business at year-end, as the value of our insurance business is now oriented around our growing retirement solutions business. 2026 has seen a continuation of the momentum from 2025. We took advantage of the variable market conditions and executed a $40 million bond offering, helping extend our maturity profile at an attractive rate of 8%, reducing our secured indebtedness and lowering our cash interest expense while providing financial flexibility as we accessed a new source of capital. We believe diverse sources of capital are integral to fueling growth. As such, we are incredibly pleased with the market's reception to our inaugural U.S. listed notes offering and view our access to the capital markets as another differentiating factor for our business.

Additionally, in line with our stated capital allocation framework, we closed a $50 million tender offer at a meaningful premium to where market prices were, and our board has subsequently authorized a new $10 million share repurchase program through December of 2027. This authorization provides us with ongoing flexibility to opportunistically repurchase shares, which accretes to the benefit of all of our shareholders. With respect to our dividend, we're excited to announce that our board has approved a dividend of $0.03 per share for the quarter. Our dividend policy is built on the belief that our investors should receive the benefit of our stable fee paying earnings model. We hope today's declaration and our historical track record demonstrates our focus on returning capital to shareholders.

Lastly, we finalized an agreement to add approximately $125 million of assets under management to our platform. This agreement became effective in March 2026. We expect these additional managed assets will contribute approximately $500,000 of incremental FRE in 2026, with the potential to eclipse $1 million of incremental FRE for the full year of 2027. This is further proof of our investors' trust in the Mount Logan platform and offers another example of the organic growth momentum we are seeing. These events, taken together, organic and inorganic, in 2025 and thus far in 2026, reflect compounding output of the platform we've built. Proud of the team for executing on each of these strategic initiatives. These accomplishments demonstrate the efficiency of our platform with the benefit of BC Partners' resources and support.

The organization we are supporting today is leaner, more focused, and better aligned than at any point in my experience. I will now turn the call over to Nikita to walk through our financial results for the fourth quarter and full year of 2025.

Thanks, Ted. Good afternoon, everyone. As Ted mentioned, 2025 was a transformational year for Mount Logan. Following the completion of our business combination and renewed focus on building a durable core earnings base across both asset management and insurance. It also has been a year in which we've deliberately front-loaded investment in capital, in infrastructure, and in strategic transactions with a clear expectation that the recurring earnings benefit would materialize from 2026 onwards. The financial results we are reporting today reflect this sequencing. We want to be transparent about what is structural versus intentional and transitory. While our GAAP results reflect several one-time items, the underlying business made important progress, particularly in establishing a foundation for recurring fee earnings and improving the long-term earnings power of the insurance platform. I'll focus my remarks today on three areas, consolidated performance, segment results, and our core earnings metrics.

For the full year 2025, total revenue was $53.6 million, up approximately 8% year-over-year. We reported a post-tax net loss of $60.8 million for the period. These results were primarily driven by non-recurring and mostly non-cash items, including transaction and integration costs related to the business combination, impairment of legacy intangible assets within the asset management segment, goodwill impairment within insurance, and certain legal expenses. Excluding these items, the underlying performance of the business was significantly more stable. Moving on to segment results. In our asset management segment, fourth quarter 2025 revenue, including investment income, was $2.6 million, compared to $3.8 million in the prior year.

The decline is largely due to declines in management and incentive fees in non-core vehicles and some accounting noise created by the merger of Logan Ridge and Portman Ridge, which occurred in the third quarter of 2025. Mount Logan now receives distributions from BCIC through its minority stake in Sierra Crest and the profit-sharing interest. However, the distributions do not directly flow through the income statement, which accounts for a large component of the decline in revenues. Overall, we anticipate this merger will result in greater fees and distributable earnings going forward as synergies are realized in the combined vehicle. In our asset management segment, full-year revenue, including investment income, was $21.5 million, up 44% year-over-year.

This top-line increase was mainly driven by two one-time items, the $4.5 million gain on acquisition of 180 Degree Capital and the $1.4 million unrealized gain on our minority stake in Runway Growth Capital. Turning to our management fees. Management fees were down 14% year-over-year, primarily related to non-core fee vehicles. Specifically, the AIF Fund and CLOs have continued to wind down. Similarly, incentive fees were down 50%, which relate to the AIF Fund's continued wind down and management's decision to voluntarily waive fees at SOFIX as we continue to invest in the growth of the fund. Overall, our performance reflects the continued wind down of legacy strategies and transition to a more scalable and recurring revenue base.

Importantly, we are beginning to replace those fees with new fee streams, including the aforementioned profit-sharing arrangement with the parent entity of Sierra Crest and transaction and advisory fees, which contributed approximately $800,000 in 2025. Turning to insurance solutions. Net investment income was $14.8 million in the fourth quarter of 2025, down 21% from the fourth quarter of 2024. When we exclude funds withheld, net investment income was $13.4 million for the same period. The investment portfolio generated a 6.3% yield for this period, or 7.3% excluding funds withheld, and our asset management or insurance AUM increased to approximately $1.1 billion. These yields are compared to yields of 8.6% and 8.7%, respectively, in 2024. Full-year net investment income was $79 million, down 15% year-over-year.

Excluding funds withheld, net investment income was $55 million, down 5% year-over-year. The decrease was driven by a declining interest rate environment, which has reduced yields on our investment portfolio, increased interest expense driven by the interest rate swap, which we started paying on in 2025, and higher investment expenses and certain credit-related impacts within the portfolio. For the full year, the investment portfolio generated a 6.9% yield or 7.7% excluding funds withheld. These yields are compared to yields of 8.5% and 8.8%, respectively, in 2024. During the fourth quarter, we also recognized a $25 million goodwill impairment related to the legacy long-term care block. Importantly, we do not view this impairment as indicative of the underlying performance or long-term value of the broader insurance platform.

Rather, it reflects updated assumptions specific to that legacy business, which is not central to our growth strategy. From a strategic standpoint, 2025 was focused on repositioning the insurance platform, including rotating out of underperforming assets and contributing capital to support future growth. Additionally, the significant equity contribution into Ability in 2025 was a key enabler. It expanded Ability's capital base, supporting our reinsurance growth and positions us for the longer-term direct writing goals Ted described. Looking at core earnings. Fee-related earnings, or FRE, were $8.5 million for the full year, down modestly year-over-year as the decline reflects the fee waivers at SOFIX and changes in our overall revenue mix as we focus the core earnings power of the asset management segment. SRE—spread related earnings, or SREs, were approximately breakeven compared to $13.7 million in 2024.

The decline was driven by lower investment income and higher cost of funds, particularly within the long-term care or LTC block, as assumption updates unfavorably impacted the cost of funds. The break-even SRE led segment income to be $8.5 million, down from $22.8 million in the prior year. Importantly, both FRE and SRE reflect businesses that are being actively repositioned rather than steady state earnings power. We ended the year with a solid capital position, reporting total capital of approximately $185 million, a decrease of $11.9 million compared to fiscal 2024. Our balance sheet is well-positioned entering 2026. As Ted noted, the investment grade rating and $40 million bond issuance completed subsequent to year-end provide meaningful incremental financial flexibility and reflect the quality of our platform.

We ended the year with $15 million in cash and cash equivalents within our asset management and corporate segments, and total debt across the company stood at $93.5 million, consistent with our internal targets. The $15 million tender and the $10 million share repurchase authorization are both part of the coherent capital allocation framework. Return capital when it creates value for investors, invest when the economics of growth are compelling, and maintain the balance sheet flexibility to do both. We believe we have the right balance today, and the post-quarter milestones Ted has outlined reinforce that. The board has also approved a dividend of $0.3 per share for the quarter, continuing our 26th consecutive quarter dividend track record spanning both our Canadian and U.S. listing histories. Overall, we view this as a floor that grows as our FRE and SRE scale.

Looking forward to 2026, expense discipline and operational efficiency are priorities. Recurring revenues are building, one-time headwinds are behind us, and the pipeline of growth initiatives is incredibly strong. The directional picture for FRE and SRE is clearly improved versus where we exited 2025. Now, before I hand the call back to Ted, I did want to take a brief personal moment. As many of you are aware, this will be my last earnings call as Chief Financial Officer of Mount Logan Capital. It has genuinely been a privilege to be part of this team through what has been the most consequential period in the company's history. The domiciling, relisting, transitioning to U.S. GAAP, and completing the 180 Degree Capital foundation, laying the foundation for what I believe to be a very exciting next chapter. I leave feeling proud of what we have accomplished together.

I wish Ted and Henry and the entire team every success. It has been an honor.

Thank you, Nikita, and thank you again for your contributions to the company, and we wish you all the best. Before we open for questions, I want to leave you with a clear picture of how we think about the opportunity in front of us. Mount Logan today has three engines powering the flywheel of our business. The first is our private credit asset management business. Scalable, fee generating, anchored in permanent and semi-permanent capital, with a robust pipeline of organic and inorganic growth opportunities. The Yieldstreet transaction is the first inorganic step and will not be the last. The second is our insurance platform. Ability is well capitalized and positioned for meaningful expansion, which we envision will include a transition away from reinsurance and into direct writing in the near term. As we make investments in Ability, Mount Logan benefits from the corresponding increase in AUM, FRE, and SRE.

Third is our approach to product credit origination and investing. We employ a rigorous and disciplined process around the underwriting of investments we manage on behalf of our investors and policy holders. We maintain expansive credit and product capabilities that support our differentiated origination funnel, ensuring Mount Logan is not overly reliant or correlated to any single product or market. Today, we have diverse expertise that spans the credit spectrum, enabling us to be opportunistic as we seek attractive risk-adjusted returns across market environments. We've built a scaled public alternative asset manager with insurance and a compounding fee earnings and own liability origination. This model that we believe will trade at a meaningful premium to where Mount Logan is valued today. To close that valuation gap requires strong execution, which we expect to demonstrate in 2026 and beyond. This concludes our prepared remarks.

We'll now transition the call to a Q&A session if the operator would please coordinate.

Thank you. As a reminder, to ask a question, please press star 1-1 on your telephone and wait for your name to be announced. To withdraw your question, please press star 1-1 again. One moment for questions. Our first question comes from Matthew Lee with Canaccord Genuity. You may proceed.

Hey, morning, Ted. FRE numbers have been running a bit lower than prior year levels. When do we get back to kind of growth on that front, on the FRE side as well as the AUM side?

Yeah, no, I appreciate your question. I mean, I think last year was really a year of transition. So, you know, we were in the process of obviously doing our Portman Logan management contract conversion. You know, we had the Ovation wind down. We had certain fee waivers within SOFIX, which got us, you know, to growing again. We've entered into a bunch of new things that'll grow earnings. Obviously expect Ability to kind of reignite growth this year. We entered into a Vista Life mandate that'll give us another $125 million of assets. Obviously the deal we announced this morning, which closed probably in the third quarter, should lead to additional FRE growth as well. I think between everything we're doing, between our BDCs and kind of our core businesses, it should set us up for growth this year.

Okay, great. Maybe on the deal, if we can dive into it a bit. It's definitely a bit complex. You know what? You kind of mentioned permanent capital here, but, you know, are there any things in the structure that allow the new assets to, you know, prevent distributions or redemptions rather? Is that similar or dissimilar to how SOFIX operates currently?

Yeah. I mean, it's a pretty synergistic acquisition for us. You know, a huge part of the headlines right now are focused on big cap sponsor credit, which we don't really do. The big growth area for us is really in asset-based finance, which is kind of what Yieldstreet does. The assets fit us really well. We have expertise in it, and it's really an asset purchase. To your point, that fund has the ability to redeem up to 5%. We have to honor 5% of redemptions every quarter. It's not. It's what I'd call, like, quasi-permanent capital. Historically, it's rare that people over-redeem for what the 5% is. Obviously, the retail channel's challenged right now, just given some of the headlines.

It gives us a growth in that vehicle, whereby we think we can kind of get it onto some of the wirehouse, do some other things with it. But again, the people do have the ability to get some liquidity out of those assets.

All right, thanks. I'll pass the line.

Thank you. Our next question comes from Francis Lau with Lucida Capital. You may proceed.

Hey, Ted. Broader question: how are you thinking about the macro and competitive environment for private credit and insurance in 2026? Like, how are you guys positioning to either benefit or face headwinds from the current conditions?

Yeah, it's a good question. I mean, there's just a big disconnect between what you're reading in the press and what we're seeing. Like, our portfolio is actually in really good shape. We don't have elevated defaults. Our companies are still doing well. We don't really have a lot of new watchlist assets. And a lot of the things that people are talking about in the press, you know, our business is mostly exposed to non-sponsor specialty finance and other areas that are probably less topical. You know, again, like, if you look at risk premium in the credit markets, which obviously correlated to some of these default metrics, you know, obviously high yield is near all-time tights, investment grade spreads all-time tights. The liquid markets are telling you that they're not expecting a massive default cycle.

Even if it does, you know, on the ground, you know, private lending is still incredibly competitive. Spreads are wider, but maybe by like 25 basis points. Again, the big topical question is always around software. You know, we're very underweight software vis-à-vis the overall market. Again, I think we think that a lot of our software businesses will actually benefit, not be hurt by AI, but it's right now being treated like every single software company is gonna be a loser and, you know, I think there's gonna be some winners and some losers.

Okay, thanks. Maybe the second question is, you know, following up on Matt's question. You know, you guys are continuing to, you know, consolidate opportunities in the pipeline like OCIF, BCPO, other BDC consolidations. How active is the pipeline? Like right now, are you seeing a lot of, or are you seeing any kind of valuation opportunities that you can pick off because of whatever reason the seller has? Like, how are you looking at that side of things?

Yeah. Well, our M&A pipeline tends to be cyclical, and it's actually almost like countercyclical, so the more choppy the market is, the bigger our pipeline is. We have a really big pipeline now of inorganic opportunities. It's something that we're thinking about. It gives us scale. We've done it very effectively. As you know, we've made many acquisitions. I would expect us to be very active on the M&A front. We think we have really good inorganic opportunities. I believe we have good organic growth opportunities, particularly in our insurance business. We also think there's gonna be a big opportunity for inorganic growth.

Like for example, in the retail channel, which obviously is very challenged today, the top 10 interval funds manage around $90 billion, and the next 100 manage $30 billion. There's a whole bunch of kind of $100 million-$500 million funds that look and feel a lot like the Yieldstreet transaction, and I think we'll be pretty active in that area on a go-forward basis.

Okay, great. Thank you.

Thank you. Our next question comes from Whit Huguley with River Oaks Capital. You may proceed.

All right, Ted, how are you doing? Congrats on the great acquisition, and thank you, Nikita, for all you did for us shareholders. I was just kind of diving back into kind of what you've already talked about, but how much does the Yieldstreet deal impact Mount Logan's FRE from an FRE perspective and by when? 'Cause just from reading the press release and by my own calculations, it's almost an immediate 30% accretion to FRE on a pretty small investment.

Yeah. I mean, you're not far off on your numbers. You know, again, we're able to buy this at a very accretive multiple. As you guys have read, most of it's through cash. The assets fit us strategically very, very well. To your point, like, it will lead to a nice bump in our FRE on a run-rate basis. It obviously won't close for probably three to four months. On a run-rate basis, we expect to see the impact and a pretty material impact of this acquisition in the second half of this year.

Okay. Thanks. That helps. This was kind of already addressed, but as far as inorganic growth goes, does this type of deal with Yieldstreet reflect the kind of deals that you wanna do in the future? How plentiful is that pipeline? Are there other similar deals out there?

Yeah, yeah. No, good question. What I would say is we are you know currently evaluating lots of things. I mean, again, we're gonna stick to our core business, which is credit, and so our credit-related assets. We are you know again there's just a number of things we're looking at now. These transactions are very hard to get done because it's not just about price. There's a big social component too as well. Again, you know, boards wanna make sure that whoever the buyer is gonna be a good steward of capital. We would expect to announce maybe two or three more of these between now and end of the year. Again, that should be a good tailwind for us in the second half of this year around earnings.

Awesome. Thanks so much, Ted.

Thank you. As a reminder, to ask a question, please press star 1-1 on your telephone. One moment for questions. Our next question comes from Ben Brostoff with Brostoff Capital. You may proceed.

Hey, guys. Thanks for taking my question. I was wondering if you could talk a little bit more about the capital contributed to Ability, and whether you will need to contribute more going forward. If you could just talk a little bit about, I think in the 10-K you have $37.2 million towards Ability. I'm not sure if that is over the entire life of owning it or this year. If you can just provide a little clarification there, that'd be great. Thank you.

Yeah, I mean, I think the Ability business model has been largely reinsuring other people's assets. You know, I think it's very strategically important for us that we have the ability to write our own annuity policies. We've injected a lot of capital largely from the 180 Degree deal into our insurance company. We're in the process of getting rated, and then soon afterwards we'll be able to direct write business. That should drive our liability costs lower, and we're less reliant on third parties for reinsurance. You should see. There's this weird lull period where, you know, you got to put the capital in before you see the benefits into SRE. We should see an SRE benefit in the second half of this year.

You know, again, like that cash, we need to put it in there first before we can kind of use it to run annuity business. Expect to see the benefits of that flow through kind of second, third, and fourth quarter of this year.

Just adding on to that, the number you quoted, the $37 million, that's inclusive of the $19 million that was contributed this past year. You can see also just what the RBC of the company or of Ability is as well. Now it's well over 500, which really positions us well for the strategic initiatives Ted mentioned.

Awesome. Thank you so much.

Thank you. Our next question comes from Masa Sung with TD Securities. You may proceed.

Thank you for taking my question. Good afternoon, Ted. I just wanted to follow up on Francis' question earlier. I wanted to, you know, ask about the credit quality across SOFIX and then the broader managed portfolio. You know, you did mention the AI disruption risk in private credit. How should we think about the risk profile of what you manage, and how are you kind of seeing, you know, the current market dynamics play out in the field?

Yeah. No, that's a good question. I mean, I would say we run incredibly diversified portfolios. I would say we're very underweight software, BDC others. I would say, you know, as of now, we really haven't seen weakness in our broader portfolio. I'm pretty negative, generally speaking. I would say, as of now, we just haven't seen it show up in our portfolios. Obviously we're underwriting each of our assets with an eye towards AI. I would say that, you know, a lot of that stuff we just don't know the answer to. Again, in debt world, you know, we obviously attach at something like 30%-35% loan to value.

Even if there is destruction of value in software verticals, you would need a pretty big destruction in value for us not to kind of get our money back. Then we have hard maturities. We're not relying on selling businesses, everything else. I actually think that the private credit industry is actually relatively well positioned despite all the headlines and negative press. A lot of the things that people are pointing to as being, you know, indicative of weakness in private credit have largely been, you know, financial services businesses that impacted banks, not private credit. You know, when people point to First Brands and Tricolor and some of these other big names that have been very topical, most recently MFS, you know, by and large, private credit managers just haven't been that exposed to those situations.

That's helpful. Now maybe switching gears a bit, my first question is on the Ability and then the insurance platform. You did mention that the ambition to move toward more direct writing over time. Can you give us a sense of the timeline and what that transition would look like?

Yeah, I mean.

Oh, sorry. Go ahead.

No, go ahead. Go ahead, Masa. Sorry.

Oh, my. My second question is just on the dividend. You know, how should we think about this $0.03 per quarter you announced. Would that be the right run rate going forward, or can we expect growth as FRE scales from here?

Okay. The second question, I would say, you know, we want to have a dividend yield on our stock because I think it creates capital discipline. We have a lot of growth areas, and so we've had a lot of dialogue with our shareholders around dividend policy, and I think we feel pretty good about where our dividend is today. We expect to see pretty material FRE growth over the next 18-24 months. And then we can reassess where we are with our dividend. You know, we have a lot of very creative uses of our cash right now, both on the insurance side and on the inorganic side, as we talked about earlier. I think we're going to prioritize most likely growing FRE vis-a-vis returning capital to shareholders. Again, we've announced a buyback program.

We obviously just did a $15 million tender, and we pay a very competitive dividend yield. I feel like we're striking a pretty good balance between trying to grow with returning capital to shareholders. On the insurance side, I mean, the timing is, you know, again, we're working through. We had to recapitalize the insurance company, which, you know, Nikita just walked you through some numbers. We're in the process of getting a rating, and we expect to get that over the next kind of, like, four to six weeks. Then from there, the plan would be to start direct writing and probably in the third quarter.

Thank you. That's helpful. I'll pass the line.

Thank you. I'm not showing any further questions. I would now like to turn the call back over to Ted Goldthorpe for any closing remarks.

Thank you. Thank you everyone for your time today, and I wanted to close the way we opened. We spent 2025 building and investing. The heavy lifting is done. In the weeks since December 31, we've already announced a transformative AUM acquisition, executed a $40 million bond issuance, completing a $15 million tender offer, authorized a $10 million share repurchase program, and signed an expanded managed account. Despite the broader market volatility, Mount Logan is experiencing positive and strong momentum across our business. We look forward to continuing to execute for your benefit. On behalf of the entire Mount Logan team, I want to say thank you to our shareholders for your continued support. We look forward to speaking with you when we report first quarter results in May. Have a good weekend, and thank you.

Thank you. This concludes the conference. Thank you for your participation. You may now disconnect.

Good morning, ladies and gentlemen, and thank you for standing by. Welcome to Mount Logan Capital's Third Quarter 2025 Results Conference Call. Before we begin, I'd like to remind listeners that today's discussion will include forward-looking statements. These statements discuss our current expectations and projections relating to our financial position, results of operations, plans, objectives, future performance and business. These statements and other comments are not guarantees of future performance, but rather are subject to risk and uncertainty, some of which are beyond our control. These forward-looking statements apply as of today, and you should not rely on them as representing our views in the future. We undertake no obligation to update these statements after this call. For a description of the risks associated with Mount Logan Capital's business, please see our most recent filings with the SEC. In addition, we'll be referring to certain non-GAAP financial measures during this call. Additional details and reconciliations of GAAP to non-GAAP financial measures are in today's earnings release. This morning's conference call is hosted by Mount Logan's Chairman and Chief Executive Officer, Ted Goldthorpe; our Chief Financial Officer, Nikita Klassen; our President, Henry Wang; and the Head of Investor Relations, Scott Chan. As a reminder, all references to dollar amounts on this call are in U.S. dollars unless otherwise stated. I'll now turn the call over to Mr. Goldthorpe. You may begin.

Thank you, everyone. Good morning, and thank you, everyone, for joining us today. What a year it has been for our company and team. We are incredibly excited to discuss Mount Logan Capital's third quarter with you today, which reflected the culmination of several years of preparation and hard work that enabled us to redomicile from Canada to the U.S., translate our financials from IFRS to GAAP and now trade on the NASDAQ Capital Market under the ticker MLCI. This year has been the heaviest lift for our team yet, and I'm deeply grateful for everyone's contributions and support to get us here. A special thank you to our shareholders and Board members for supporting our vision for Mount Logan, including the 180 Degree Capital shareholders, management team and Board, which overwhelmingly supported the combination of our respective businesses and specifically the vision we have for growth in 2026 and beyond. We're excited to welcome everyone to Mount Logan's first earnings call as a U.S.-listed alternative asset management platform and insurance solutions platform. While we will spend time discussing our financial results today, given the intra-quarter transaction and related movements on the legacy term portfolio and transaction expenses, there is some noise in the numbers, and therefore, I want to spend some additional time today laying out the vision we have for our platform as we look ahead to 2026 and our ambitions for driving significant AUM, FRE and SRE expansion for the years to come. We'll also provide a quick update on our capital allocation expectations through year-end before we turn the call over to Nikita to review our third quarter financial performance in more detail. Today, Mount Logan is an alternative asset management and insurance solutions platform that manages in excess of $2 billion of assets for various investment vehicles and accounts. We operate within what we believe to be the most attractive areas in the financial services space, private credit and insurance solutions. Since 2018, we've carefully built and shaped the Mount Logan platform with 3 focuses: one, build our FRE and AUM foundation on permanent and semi-permanent capital for a wide array of investors. Mount Logan has the support of large institutional investors, the retail investor community and through ability and insurance platform; two, employ rigorous and disciplined process around originating and underwriting the assets and investments we manage on behalf of those same investors; and three, maintain expansive credit and product capabilities in support of truly differentiated origination funnel, which ensures Mount Logan is not overly reliant or correlated to any single product or market. Today, we have a diverse expertise that spans the credit spectrum and enables us to be truly opportunistic as we seek attractive risk-adjusted returns in various market climates on behalf of our investors. We've experienced success scaling our business through organic and inorganic initiatives. As of today, we believe our business has the team, capabilities and through the merger with TURN Capital to drive investment into our business to accelerate growth in 2026 and beyond. Since the acquisition, we've completed efforts with respect to integrating front, middle and back-office functions. And we've already seen the benefits of adding 180 Degree Capital's network in the middle market to ours, which has enabled us to expand the universe of clients we serve within our suite of private credit solutions now with an improved line into public companies. With the modest integration lift now complete, our focus is on accelerating growth while maintaining stringent discipline on investments and costs. On the Insurance Solutions side, we see an immediate opportunity to invest capital into Ability to increase its capital base, take on additional reinsurance obligations. We've continued to invest in our insurance solutions team and believe we have the policies and procedures in place to grow this business significantly over the coming years. Our insurance solutions vertical is incredibly strategic to Mount Logan, and we view it as a core vertical for driving growth in our business as both our ability to manage our policyholder obligations and assets prudently to achieve positive spread earnings is the key to our organic thesis. On the asset management front, Mount Logan continued to advance its strategy as a leading consolidator in the business development company or BDC universe. Our approach centers on building scale and stability through permanent capital vehicles. In July, the merger of Portman Ridge and Logan Ridge was completed, creating what is now called BCP Investment Corporation. This created a larger, more efficient vehicle with substantial synergies, both from a portfolio perspective and given the significant overlap through the elimination of expenses, driving improved earnings capacity. From an economics perspective, Mount Logan will receive increased distributions from Sierra Crest Investment Management and its affiliates as Sierra Crest will serve as the investment adviser to the significantly larger BDC and BCP Investment Corp. Mount Logan today maintains a minority stake in Sierra Crest, which will allow -- which will continue to benefit Mount Logan as BCP Investment Corporation grows. In parallel, through our minority stake in Runway Growth Finance, we're able to support the recently announced merger of Runway Growth Finance Corporation with SWK Holdings. This combination will expand Runway's capability into health care and life sciences lending and demonstrate the continued consolidation taking place across the BDC ecosystem given the significant benefits that exist for investors in these funds as they scale. Collectively, these initiatives reinforce Mount Logan's long-term strategy of scaling permanent capital vehicles, diversifying credit capabilities and driving operating leverage across our platform for the benefit of our investors and policyholders. While the near-term financial benefit to Mount Logan remains limited, over time, these transactions will accrete to the benefit of Mount Logan and its shareholders as AUM and FRE increase. We enter this next phase of Mount Logan's growth with an incredible amount of momentum. Our platform is now fully equipped to capitalize on opportunities across both asset management and insurance solutions, and we're already seeing an acceleration into year-end of actionable opportunities. Before I hand the call over to Nikita to walk through the results of the quarter, I also want to touch on our capital allocation framework given our strengthened balance sheet today. We expect to remain opportunistic in how we deploy the capital with a focus on balancing growth, reinvestment of our business and return of capital to our shareholders. Supporting various initiatives to advance our business is a priority for our team, and we expect AUM growth to primarily come from our management of Ability, the Opportunistic Credit Interval Fund, or SOFIX, and our stakes in BDC managers, Sierra Crest Investment Management and Runway Group, which support FRE expansion. We also have a robust pipeline of acquisition opportunities, which will scale our existing permanent and semi-permanent capital vehicles, increase our retail product and distribution capabilities and help us to originate new or differentiated pools of assets for the benefit of our managed vehicles and accounts. The final component of our capital allocation strategy is centered around both near-term liquidity opportunities for our shareholders as outlined as part of the 180 Degree Capital transaction, along with the implementation of a sustainable dividend policy going forward. Our team remains committed to providing up to $25 million for shareholder liquidity at or above the closing merger value over the next 24 months. We continue to expect to launch a tender for up to $15 million in the weeks to come, which we anticipate will be at or around $9.43 per share, consistent with the valuation closing of the merger. This price represents a premium to our current share price as of yesterday's close. Therefore, we expect to be opportunistic in how we deploy the remaining capital over the coming 24 months. We hope this commitment supports trading liquidity in our shares as growth initiatives progress over the next 2 years. To ensure liquidity mechanisms focused on providing value to our shareholders, Mount Logan's management team, Board and affiliate entities will not participate in any tenders or share repurchases associated with the liquidity programs. This decision reinforces management's confidence in the long-term outlook for Mount Logan and the strength of our business combination. On the dividend front, Mount Logan was proud to have paid a dividend for the 25th consecutive quarter while listed in Canada, and we're excited to announce the Board has approved a dividend of $0.03 per share for the quarter. Our dividend policy is built on the belief that investors should receive direct benefit of our stable fee playing earnings model, and we hope today's declaration and our past track record clearly demonstrate our belief in returning capital to shareholders. As our platform scales, we hope to grow our dividend while maintaining financial flexibility to reinvest for future expansion. With that, I will now turn the call over to Nikita to review our third quarter financial performance.

Thanks, Ted. Good morning, everyone. Before reviewing our third quarter results, we want to note that as part of the acquisition of 180 Degree Capital, Mount Logan has transitioned its financial reporting from IFRS to U.S. GAAP. All the financial results discussed on today's call are presented under U.S. GAAP, which, while required as a U.S. registrant, also enhances the transparency and comparability of our financial performance going forward and with our peers. Further, some results are not directly comparable year-over-year as the acquisition of 180 Degree Capital did not close until mid-September 2025. I'll now walk through our third quarter financial highlights. This quarter was an incredibly transitional quarter, one that reflected substantial integration costs and accounting reset and the investments being made to scale our platform. For the 3 months ended September 30, we reported a net loss of $13.4 million compared to a loss of $2.4 million last year, largely related to non-cash items. This loss was driven by a gross $19 million impairment charge tied to the Logan Ridge Investment Management contract as Logan Ridge completed its merger with Portman Ridge in July, with Portman Ridge being the surviving entity and renamed BC Partners Investment Corporation. As part of this transaction, Mount Logan recognized a profit sharing interest with an affiliate of Sierra Crest, the adviser of BCIC, which reduced the net impairment by $11.2 million. The company also recognized a $4.5 million gain on acquisition of 180 Degree Capital as consideration paid, i.e., the shares issued were less than the fair market value of the net assets acquired. We also recognized an incremental $3 million worth of transaction costs as the transaction was finalized. Total revenues for the quarter came in at $11.4 million, down 10% year-over-year, while 9 months ended revenues for 2025 rose 7% to $43.6 million. On a non-GAAP basis, segment income, which is equal to the sum of fee-related earnings and spread-related earnings, was $30.7 million for the quarter versus $4.7 million last year. Year-to-date, segment income was $8.1 million compared to $16.5 million in the prior period, largely due to lower cost of funds in comparison to 2024, primarily due to the onetime benefit of an in-force update to the long-term care business in the first quarter of 2024, which was not present in 2025. At quarter end, total assets were $1.64 billion, up 5% since year-end and shareholders' equity increased to $231 million, a 26% increase year-to-date. In our asset management business, fee-related earnings were $2.5 million for the quarter and $7 million year-to-date, roughly flat with the prior year. Management fees were $1.9 million, down from $2.8 million last year, mainly due to the Logan Ridge and Portman Ridge merger, which ended our prior advisory contract. We anticipate the profit sharing interest, which added $262,000 to FRE this period will continue to be accretive to FRE going forward. Additionally, the Ovation fund wind down, which began in the third quarter of 2024 has resulted in lower management fees going forward. These headwinds were partially offset by growing fee streams from our Vista Life & Casualty investment management mandate and growth in our integral fund, SOFIX. Incentive fees were $0.4 million, down year-over-year as the Ovation funds continue their wind down and due to voluntary fee waivers at SOFIX, while equity investment earnings rose to $0.5 million, benefiting from stronger results at Sierra Crest after the merger and elimination of expense waivers within this adviser. On the expenses side, we saw higher transaction and integration costs tied to the 180-degree merger and accelerated stock compensation expense as all historically issued stock comp vested upon close of the merger. These are both onetime items. FRE excludes these onetime items and also includes other corporate costs that are reported within the Asset Management segment, such as non-fee-related compensation, amortization and impairment of intangible assets and interest expense. Fee-generating expenses decreased due to lower professional fee spend from disciplined cost control. Overall, FRE margins held steady, supported by recurring management fees, disciplined cost control and new recurring income from our profit-sharing interest with Sierra Crest. Turning to Insurance Solutions. Spread-related earnings were $1.1 million for the quarter compared with $2.2 million a year ago. Our results reflected lower investment yields and higher cost of funds, partially offset by tighter expense management. Net investment income was $17 million, down 12% year-over-year as lower short-term rates and higher cash balances weighed on floating rate income. The long-term care block remains stable and our multiyear guaranteed annuity or MYGA reinsurance business continues to expand. We added National Security Group as a new treaty partner in the second quarter. Total assets grew to $1.55 billion within our Insurance Solutions segment with strong credit quality and ample liquidity. The net investment spread was 12 basis points this quarter or 48 basis points annualized. We expect to build towards 75 to 100 basis point range on an annualized basis as capital is deployed into higher-yielding assets than our legacy investment portfolio. Mount Logan's balance sheet remains conservatively positioned. We ended the quarter with $162 million in cash and cash equivalents, up nearly 43% from a year ago. We continue to monetize the legacy 180 Degree Capital portfolio assets in an orderly fashion and look forward to deploying that capital to fuel growth in our Asset Management and Insurance Solutions segment. We closed the quarter with $22 million in cash and cash equivalents within the Asset Management and Corporate segment, we intend to deploy towards future growth, as Ted discussed previously. Total debt stood at $74 million in the Asset Management segment and $17 million in Insurance Solutions. 41% debt-to-capital ratio. Operating cash flow also improved during the quarter as integration costs rolled off. In closing, this quarter was about completing the transition, aligning our structure, simplifying our reporting and setting the foundation for growth. We have 2 complementary engines, a capital-light asset management platform and a liability-driven insurance solutions business, which designed to generate durable recurring income. Our focus from here is straightforward: grow fee revenue, expand spreads and maintain disciplined capital management. We're well capitalized and positioned to compound value for shareholders over time. And with that, I'll turn the call back over to Ted.

Thank you, Nikita. Overall, we are incredibly excited for Mount Logan's next phase of growth as we scale our U.S. domiciled asset management and insurance solutions businesses. We have a fortified balance sheet that provides significant flexibility to invest for the future, and we are well positioned to capitalize on the opportunities we are seeing in the market. We believe the substantial time and resources invested in our business during 2025 set the stage for meaningful growth in 2026 and 2027, helping to drive long-term value creation for our shareholders. This concludes our prepared remarks. We would now like to transition the call to Q&A. If the operator could please go ahead.

[Operator Instructions] Our first question for today comes from Adam Waldo of Lismore Partners, my apologies. Our next question comes from Matthew Lee of Canaccord Genuity.

Just want to talk about the trajectory for both SRE and FRE here. You now have the capital to invest to get the flywheel moving a bit. How should we be thinking about SRE and FRE growth in F '26? And what do you think is the run rate kind of going even further medium term, just given the capital position right now?

Thanks, Matt. So let's start with FRE. So as we said, FRE was pretty much flat quarter-over-quarter. In going into 2026, I think that's really where we're going to see things start to ramp up, particularly around BC Investment Corporation. This really adds a lot of scale to our platform. Our management fees are expected to increase to about $720,000 a quarter compared to what we recognized in the prior quarter. And under this new structure, they intend to pay incentive fees as well which will probably yield to us about $500,000 annually. So this is the upside that we didn't previously had when we have -- when we were the investment manager to Logan Ridge. Otherwise, again, the focus is always on cost and really making sure that we can grow these fees without expanding on the cost side, which we believe we've really invested in that over these past few years. So expect positive growth from there. Additionally, with SOFIX, one of our other growth engines, we have waived $415,000 of incentive fees to date as it continues to scale. So expect that vehicle to continue to add to FRE pretty strongly. And then lastly, Ability, our biggest growth engine. It has provided $1.6 million in fees for the quarter and $6.4 million annualized. And so as we continue to manage more of that book of investments and the vehicle continues to scale, I expect pretty strong growth there. On the SRE side, there are things within our control and things that are not within our control, largely related to cost of funds. But what we can control is really looking at sort of where rates are going and what we can do on the NII side to control it. We do have a hedge that limits some of our exposure on the downside that's helping. And then it's really just also looking at the cash drag and being able to find investment opportunities, which is challenging in a tighter spread environment. So generally speaking, it's looking pretty good. As we mentioned, we're trying to move towards a 75 to 100 basis point SRE margin going into next year. It's really just what we can control there.

Okay. Maybe asked a different way. I mean, your FRE is kind of trending towards $10 million a year at the current run rate. Your SRE is kind of recovering off a low first half. I mean, should we be thinking about this as kind of like combined $15 million to $20 million for 2026? Or is it too early for guidance?

I'd say on an organic basis, that's fair. And then it's really just how we look to deploy the capital from the current transaction and where we can see upside from there.

Yes. So I think the plan today is we do have a bunch of cash, and we're going to do a couple of different things with it. One is we're going to buy back -- we're going to do this tender that we've talked about at a big premium to market. We're going to do -- we have a really good pipeline of M&A opportunities. And number three is put capital into the insurance company. There is a lag. When we put money into the insurance company, there is a bit of a lag between capital deployment and SRE benefit. So you should really see real benefit on SRE in the second half of next year.

Got it. And maybe I'll touch on that, you mentioned M&A opportunities. I mean, 180 is now kind of digested. What sort of opportunity are you seeing in the market?

Yes. I mean I'd say this is like the perfect storm in a good way for us, which is, number one is now because we're listed on the NASDAQ, it gives us a currency that is deemed to be more attractive for many shareholders. And number two is we're getting size and scale where people feel like that works for them. More importantly, the scale matters. And I think a lot of -- the M&A environment tends to ebb and flow a little bit. Our pipeline has never been more robust. So we have 3 or 4 really strategic, very accretive things in our pipeline that we expect to announce, hopefully, some of them by the first quarter that will be real catalysts, I think, for growth for our business. So again, I think we're combining -- this year was a consolidation year. We kind of merged with TURN, we merged our BDCs. We've kind of like cut some costs. Next year, we really expect to be growing both from an organic and inorganic basis.

There are currently no further questions in the queue. [Operator Instructions] We have a question from Chuck Burns of CIBC.

Congratulations on the -- taking this over the finish line this year, this transaction. I just have a couple of questions. The U.S. market transition, how is that progressing with regard to institutional interest and maybe brokerage coverage?

Yes, it's a good question, actually. So I would say this is kind of like we had to get through this last quarter and get this announced. And I think this tender is going to be obviously a good catalyst for us to engage with the Street. So we are -- we obviously are being very, very proactive in many different ways of engaging with institutional shareholders. And because of this NASDAQ listing in our size, it gives us an opportunity to have a more robust dialogue with people than previously. So I think that's a big, big focus of ours now that the quarter is out, now that the transaction is closed and now that we're going to announce this tender.

Okay. And the second question is there's been a lot of noise in the markets regarding private credit and the media has been kind of all over that issue. How is that impacting Mount Logan?

Very good question. I would say People have been calling for a [indiscernible] in private credit since I got in the business like 20 years ago. I mean I would say the recent -- the 4 big recent headlines all have similar things in common. And I'm referring to like first brands and some other things. First of all, first brands, most of the capital -- only 2% of the capital structure was in private credit hands. Most of that was either syndicated risk or in other channels. And again, the most of each of these 4 idiosyncratic situations, Tricolor, that one, generally speaking, were frauds or misappropriation of funds. They weren't necessarily tied to a macro theme. And then secondly, like -- our business, Mount Logan is really levered, generally speaking, towards corporate credit, and we haven't seen a big deterioration in corporate credit at all quite yet. And I'm not saying it's not going to happen. We just haven't seen it. All of these things, the catalyst to cause the stress came out of the asset-based part of their business. and the asset-based finance part of their business. And that's where -- that's like we're not really -- we're not leveraged those kind of channels.

Our next question comes from [ Ben Brockhoff ] of [ Brockhoff Capital. ]

I wanted to ask about return on equity and whether you're seeing any changes on that because of spread compression or other reasons. I know you had guided to about, call it, 25% or 26% ROEs in one of the last presentations. I wanted to see if you had any commentary on that guidance, either short term or long term.

Yes, I'll answer that. So I would say like if you just take a step back, right, like there's a couple of tailwinds for ROE. One is scale. So like we have public company costs that we are amortizing on a lower base. Number two is obviously our insurance company is expected to grow. So we have a little bit of a transition period because we're sitting a lot of cash post merger. But once we kind of fully integrate all of that, there should be some good tailwinds on our ROE. The 25% you're referring to is the incremental ROE we get from investing in our insurance company. It doesn't necessarily measure it overall. But we do expect to drive pretty robust ROEs on a go-forward basis.

At this time, we currently have no further questions. So I'll hand it back to the management team for any further remarks.

Thank you, everyone, for your time today. Looking ahead, our focus remains on disciplined execution and delivering measurable milestones that will showcase the strength of the platform we've built. As always, we are happy to make ourselves available for any questions you may have. We look forward to speaking with you to recap the fourth quarter and full year 2025 results in March of 2026. I hope everyone has a good weekend and a good American Thanksgiving. Thank you.

Thank you all for joining today's call. You may now disconnect your lines.