Sixth Street Specialty Lending(TSLX) - 2025 Q3 - Quarterly Results

Financial Performance - For Q3 2025, Sixth Street Specialty Lending reported net investment income of $0.54 per share and net income of $0.47 per share, reflecting an annualized return on equity (ROE) of 12.5% and 11.0%, respectively[2]. - The adjusted net investment income and adjusted net income for Q3 2025 were $0.53 per share and $0.46 per share, corresponding to an annualized ROE of 12.3% and 10.8%[3]. - Total investment income for Q3 2025 was $109.4 million, a decrease from $119.2 million in Q3 2024, attributed to lower interest rates[14]. - Net investment income for the three months ended September 30, 2025, was $50.7 million, down from $57.6 million in the previous quarter, a decrease of 15.0%[29]. - Net income for the same period was $44.6 million, compared to $51.0 million in the prior quarter, reflecting a decline of 12.8%[29]. - Adjusted net investment income per share was $0.53 for the three months ended September 30, 2025, down from $0.61 in the previous quarter, a decrease of 13.1%[29]. - Annualized return on equity based on net investment income was 12.5% for the quarter, compared to 14.4% in the previous quarter, indicating a decline of 1.9 percentage points[29]. - Total investment income for the three months ended September 30, 2025, was $109.4 million, down from $119.2 million in the same period last year, a decrease of 8.8%[34]. Investment Activity - New investment commitments for Q3 2025 totaled $387.7 million, up from $297.7 million in Q2 2025[7]. - The principal amount of new investments funded was $351.8 million, with exits and repayments totaling $302.8 million during the same period[8]. - Total new investment commitments increased to $387.7 million in Q3 2025, up from $269.3 million in Q3 2024, representing a 43.9% year-over-year growth[36]. - Gross originations rose to $3,735.0 million in Q3 2025, compared to $2,502.0 million in Q3 2024, marking a 49.4% increase[36]. - The number of new investment commitments in new portfolio companies surged to 41 in Q3 2025, up from 8 in Q3 2024[36]. - The principal amount of investments funded totaled $351.8 million in Q3 2025, up from $189.0 million in Q3 2024[36]. - The principal amount of investments sold or repaid increased to $302.8 million in Q3 2025, compared to $90.2 million in Q3 2024[36]. Asset and Debt Management - The reported net asset value (NAV) per share was $17.14, a slight decrease from $17.17 at the end of Q2 2025, primarily due to the reversal of net unrealized gains[4]. - The Company had $83.2 million in cash and cash equivalents and a total principal value of debt outstanding of $1,858.7 million as of September 30, 2025[16]. - The debt-to-equity ratio increased to 1.15x at the end of Q3 2025, compared to 1.09x at the end of Q2 2025[18]. - Total assets decreased to $3,509.3 million as of September 30, 2025, from $3,582.2 million as of December 31, 2024, representing a decline of 2.0%[29]. - Total net assets increased to $1,619.7 million as of September 30, 2025, compared to $1,607.5 million as of December 31, 2024, an increase of 0.8%[32]. - Cash and cash equivalents increased to $83.2 million as of September 30, 2025, from $27.3 million as of December 31, 2024[32]. Yield and Interest Rates - The weighted average total yield of debt and income-producing securities at fair value was 11.4% for Q3 2025, down from 11.7% in Q2 2025[10]. - Weighted average yield of debt and income-producing securities at fair value was 11.4%, down from 12.3% in the previous quarter, a decrease of 0.9 percentage points[29]. - The weighted average interest rate of new investment commitments decreased to 10.3% in Q3 2025 from 12.0% in Q3 2024[36]. - The percentage of debt investment commitments at floating rates was 96.3%, slightly down from 97.2% in the previous quarter[29]. - The percentage of new debt investment commitments at floating rates reached 100.0% in Q3 2025, compared to 75.9% in Q3 2024[36]. - The weighted average spread over the reference rate of new floating rate investment commitments was 6.6% in Q3 2025, slightly down from 6.8% in Q3 2024[36]. Company Management - Sixth Street Specialty Lending is externally managed by Sixth Street Specialty Lending Advisers, LLC, an affiliate of Sixth Street, which manages over $115 billion in assets[37].