Sixth Street Specialty Lending (NYSE: TSLX) reported second-quarter net investment income and net income of $0.43 per share for the period ending June 30, 2026, maintaining a net asset value of $16.24 per share. The company’s quarterly dividend of $0.42 will be paid on September 30 to shareholders of record as of September 15. CEO Bo Stanley indicated the company achieved annualized returns on equity of 10.6% based on net investment income and 10.5% based on net income.
In Q2, the company experienced $192 million in repayments, a 70% increase from the previous quarter, resulting in $55 million of net repayment activity. Total investments reached $3.3 billion, with principal debt outstanding at $2 billion. The company maintained a stable credit quality, with 1.3% of the portfolio on non-accrual status and no new non-accrual investments in the quarter. The weighted average interest coverage for the portfolio improved to 2.4x, and the overall portfolio companies reported approximately 8% revenue growth.
Management revealed the average debt-to-equity ratio increased to 1.24x, affected by cash reserves for maturing unsecured notes. Total investment income rose to $97.8 million from $93.4 million in Q1, alongside a rise in net expenses to $55.7 million primarily due to higher interest costs. As of quarter-end, undistributed income was estimated at $1.12 per share, and the company anticipates a more active investment pipeline starting in the third quarter.
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