Sixth Street Specialty Lending, Inc. reported its financial results for the first quarter of 2025, revealing a net investment income of $58.0 million, an increase from $52.4 million in the same period last year. The company generated total investment income of $116.3 million, slightly down from $117.8 million in the prior year. The decrease in total investment income was primarily attributed to a reduction in paid-in-kind interest income, which fell to $5.4 million from $8.1 million. The company’s earnings per share for the quarter were $0.39, compared to $0.53 in the previous year.
Total assets as of March 31, 2025, were reported at $3.50 billion, a decrease from $3.58 billion at the end of 2024. The decline in total assets was driven by a reduction in the fair value of investments, which fell to $3.41 billion from $3.52 billion. The company’s net asset value per share also decreased to $17.04 from $17.16. The total liabilities decreased to $1.90 billion from $1.97 billion, primarily due to a reduction in debt obligations.
In terms of operational developments, Sixth Street Specialty Lending continued to focus on its core strategy of lending to middle-market companies. As of March 31, 2025, the company had investments in 115 portfolio companies, with an aggregate fair value of $3.41 billion. The weighted average interest rate on new investment commitments was reported at 11.3%, with 85.1% of new debt investment commitments being at floating rates. The company funded $136.8 million in new investments during the quarter, while exits and repayments totaled $269.6 million.
Looking ahead, Sixth Street Specialty Lending expressed cautious optimism regarding market conditions, noting ongoing economic uncertainties, including inflation and geopolitical tensions. The company remains committed to its investment strategy, focusing on direct origination of loans and maintaining a diversified portfolio. The management indicated that they are closely monitoring market trends and are prepared to adapt their strategies as necessary to navigate potential challenges. The company’s leverage ratio remains strong, with an asset coverage ratio of 185.1% as of March 31, 2025, indicating compliance with regulatory requirements.
About Sixth Street Specialty Lending, Inc.
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