The following is a summary of the Sixth Street Specialty Lending, Inc. (TSLX) Q4 2023 Earnings Call Transcript:
Financial Performance:
Sixth Street Specialty Lending reported an adjusted net investment income per share of $0.62 for Q4, delivering an annualized return on equity of 14.5%.
The company experienced its highest calendar annual return on equity since its IPO in 2014, despite the complex macroeconomic environment.
For the full year, it generated adjusted net income per share of $2.66, a return on equity of 16.2%.
It also declared a base quarterly dividend of $0.46 per share and a supplemental dividend of $0.08 per share.
The net asset value per share, including the impact of the supplemental dividend, was $16.96 by the end of Q4.
Business Progress:
The company expanded its balance sheet and issued equity while managing a complex macroeconomic environment.
Sixth Street Specialty Lending recorded an increase in the weighted average revenue and EBITDA of its core portfolio companies by 6%.
The company anticipates idiosyncratic credit issues to be a theme for 2024 for the sector.
In Q4, it provided total commitments of $360 million across nine new portfolio companies and realized $145 million in repayments from full and partial investment realizations.
Its 2023 portfolio growth stood at 18% year-over-year.
The company remains well-positioned with a strong performance rating of the portfolio and a consistent sector selection with a broader software theme.
With an increase in repayment activity expected in 2024, the company looks forward to more capacity for new investments.
More details: Sixth Street Specialty Lending IR
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