Sixth Street Specialty Lending, Inc. (TSLX) reported total assets of $3.58 billion as of December 31, 2024, compared to $3.34 billion at the end of 2023. Total investments at fair value were $3.52 billion in 2024, a slight increase from $3.28 billion in 2023. The company's net investment income for 2024 was $220 million, up from $196 million in 2023. Net realized gains on investments were $8.6 million in 2024, compared to $12.4 million in 2023, while net unrealized losses increased to $42 million in 2024 from a gain of $13.2 million in 2023.
Significant changes in financial performance were driven by a larger average portfolio size in 2024 compared to 2023, increased investments in dividend-yielding securities, and increased amendment and miscellaneous fees. Interest expense increased from $133.7 million in 2023 to $154.2 million in 2024, primarily due to a higher average interest rate on outstanding debt and a larger average debt outstanding. Management fees (net of waivers) increased from $45.2 million to $50.3 million, while incentive fees were $40.2 million in 2024 compared to $47 million in 2023.
The company's investment portfolio consisted primarily of first-lien debt investments (93.9% of fair value as of December 31, 2024), with a weighted average total yield of 12.3% at fair value. The average investment size was approximately $30.3 million. The company's portfolio was invested across 21 industries, with Internet Services representing the largest sector (16.4% of the portfolio). Geographic diversification included investments across the United States, as well as in Australia, Canada, and several European countries. The company had $1.95 billion in outstanding debt as of December 31, 2024.
During 2024, Sixth Street Specialty Lending funded $838.9 million in new investments across 34 new and 21 existing portfolio companies. The company also had $793.7 million in exits and repayments during the year. The company's dividend reinvestment plan resulted in the issuance of 1,231,937 shares of common stock during 2024. The company did not repurchase any common stock during the year. The company's Board renewed the Investment Advisory Agreement and the Administration Agreement in November 2024, extending them until November 2025.
The company anticipates generating future cash flow from operations and equity issuances. However, the 10-K filing also highlights several risk factors, including dependence on key personnel, regulatory risks associated with its BDC and RIC status, competition, economic downturns, and cybersecurity risks. The company acknowledges that these factors could materially and adversely affect its business, financial condition, and results of operations.
About Sixth Street Specialty Lending, Inc.
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