Q2 2024 Sixth Street Specialty Lending Inc Earnings Call Transcript
Key Points
- Sixth Street Specialty Lending Inc (TSLX) reported a new all-time high net asset value per share of $17.19, representing a 2.7% year-over-year increase.
- The company achieved an adjusted net investment income of $0.58 per share, exceeding the quarterly base dividend level by 26%.
- The Board approved a base quarterly dividend of $0.46 per share and a supplemental dividend of $0.06 per share, reflecting strong financial performance.
- The weighted average spread of new investments this quarter was 6.6%, indicating disciplined capital allocation and strong return on equity.
- The company has ample liquidity with $1.2 billion of unfunded revolver capacity and a well-laddered debt maturity profile, ensuring financial stability.
- The higher interest rate environment may lead to credit deterioration and potential credit losses, as indicated by the growing tails within portfolios.
- The weighted average yield on debt and income-producing securities at amortized cost declined slightly from 14.0% to 13.9% quarter-over-quarter.
- Net unrealized losses from portfolio company-specific events resulted in a $0.08 per share decline in NAV, primarily due to the markdown of the investment in Lithium Technologies.
- The company experienced a slight increase in net expenses, driven by costs incurred during the annual and special shareholder meetings.
- The weighted average interest rate on average debt outstanding increased slightly from 7.6% to 7.7%, reflecting a shift towards higher-cost unsecured financing.
Good morning, and welcome to Sixth Street Specialty Lending, Inc., second-quarter ended June 30, 2024 earnings conference call. At this time, all participants are in a listen-only mode. As a reminder, this conference is being recorded on Thursday, August 1, 2024.
I'll now turn the call over to Ms. Cami VanHorn, Head of Investor Relations.
Thank you. Before we begin today's call, I would like to remind our listeners that remarks made during the call may contain forward-looking statements. Statements other than statements of historical facts made during this call may constitute forward-looking statements and are not guarantees of future performance or results and involve a number of risks and uncertainties.
Actual results may differ materially from those in the forward-looking statements as a result of a number of factors, including those described from time to time in Sixth Street Specialty Lending, Inc.'s filings with the Securities and Exchange Commission.
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