Oaktree Specialty Lending Corporation Announces Second Fiscal Quarter 2025 Financial Results

Core Viewpoint - Oaktree Specialty Lending Corporation reported a decline in financial performance for the second fiscal quarter of 2025, primarily due to lower investment income and challenges with certain portfolio investments [3][4][11]. Financial Performance - Total investment income for the second fiscal quarter of 2025 was $77.6 million ($0.90 per share), down from $86.6 million ($1.05 per share) in the first fiscal quarter [4][11]. - Adjusted total investment income was $77.2 million ($0.90 per share) for the second quarter, compared to $87.1 million ($1.06 per share) in the previous quarter [4][11]. - GAAP net investment income decreased to $39.1 million ($0.45 per share) from $44.3 million ($0.54 per share) in the prior quarter [4][11]. - Net asset value (NAV) per share fell to $16.75 as of March 31, 2025, down from$17.63 as of December 31, 2024, reflecting losses on certain investments [4][11]. Investment Activity - The company originated $407.0 million in new investment commitments and received$279.4 million from prepayments and exits during the quarter [4][12]. - The weighted average yield on new debt investments was 9.5% [4][12]. - As of March 31, 2025, the fair value of the investment portfolio was $2.9 billion, consisting of investments in 152 companies [12][16]. Debt and Liquidity - Total debt outstanding was$1,470.0 million, with a total debt to equity ratio of 1.00x and a net debt to equity ratio of 0.93x [4][26]. - Liquidity included $97.8 million in unrestricted cash and over$1.0 billion in undrawn capacity under credit facilities [4][24]. - The company issued $300 million in unsecured notes during the quarter, maturing on February 27, 2030, with an interest rate of 6.340$0.40 per share and a supplemental distribution of $0.02 per share were declared, payable on June 30, 2025 [5][6]. Portfolio Composition - As of March 31, 2025, 94.9% of the portfolio at fair value consisted of debt investments, with 80.9% in first lien loans [17][18]. - The number of portfolio companies increased to 152 from 136 as of December 31, 2024 [12][17]. Recent Developments - On April 8, 2025, the company amended its senior secured credit facility, reducing interest rate margins and extending the maturity date [27]. Management Commentary - The CEO emphasized the focus on resolving challenges with certain portfolio investments and diversifying the portfolio to capitalize on market opportunities amid economic uncertainty [3][5].