Sixth Street Specialty Lending, Inc. · NYSE:TSLX
Sixth Street Specialty Lending — Q3 2024 Earnings Presentation
20 slides from Sixth Street Specialty Lending's earnings presentation, Nov 6, 2024
Slide 1: Sixth Street Specialty Lending Earnings Presentation
SIXTH STREET SPECIALTY LENDING EARNINGS PRESENTATION Quarter Ended September 30, 2024
Slide 2: Disclaimer and Forward-Looking Statement
DISCLAIMER AND FORWARD-LOOKING STATEMENT References in this presentation (“Presentation”) to “TSLX,” “we,” “us,” “our” and “the Company” refer to Sixth Street Specialty Lending, Inc. This Presentation includes forward-looking statements about TSLX that involve substantial risks and uncertainties. Th
Slide 3: Overview
14.71 0.00 $14.71 Q4'11 14.88 0.06 $14.94 14.92 0.22 $15.14 15.12 0.54 $15.66 15.19 0.90 $16.09 Q4'12 15.27 1.23 $16.50 15.29 1.61 $16.90 OVERVIEW 15.35 2.01 $17.36 15.52 2.39 $17.91 Q4'13 15.51 2.79 $18.30 15.70 3.17 $18.87 15.66 3.55 $19.21 15.53 3.93 $19.46 Q4'14 15.60 4.32 $19.92 NAV per Share 1
Slide 4: Highlights
HIGHLIGHTS • Core focus on investing in middle-market loans to US based companies – Target EBITDA: $10 million to $250 million Broadly Distributed, – Portfolio weighted average EBITDA of $110.6 million1 and median EBITDA of $51.9 million1 Scaled Senior Floating • Target investment hold size of $30 m
Slide 5: Financial Highlights
FINANCIAL HIGHLIGHTS DOLLAR AMOUNTS IN THOUSANDS Except Per Share Data; Per Share Data is Based on Weighted Average Shares Outstanding During the Period, Except as Otherwise Noted Q3 2023 Q4 2023 Q1 2024 Q2 2024 Q3 2024 Net Investment Income Per Share $0.57 $0.62 $0.59 $0.59 $0.59 Net Income (Loss)
Slide 6: Portfolio Highlights – Selected Metrics
PORTFOLIO HIGHLIGHTS – SELECTED METRICS DOLLAR AMOUNTS IN THOUSANDS September 30, 2023 December 31, 2023 March 31, 2024 June 30, 2024 September 30, 2024 Investments at Fair Value $3,113,277 $3,283,065 $3,380,009 $3,317,069 $3,441,075 Number of Portfolio Companies 131 136 124 109 115 Average Investme
Slide 7: Quarterly Statements of Financial Condition
QUARTERLY STATEMENTS OF FINANCIAL CONDITION DOLLAR AMOUNTS IN THOUSANDS Except Per Share Data; Per Share Data is Based on Ending Shares Outstanding September 30, 2023 December 31, 2023 March 31, 2024 June 30, 2024 September 30, 2024 Assets Investments at Fair Value $3,113,277 $3,283,065 $3,380,009 $
Slide 8: Net Asset Value Bridge – Q3'24
NET ASSET VALUE BRIDGE – Q3’24 $0.02 ($0.03) $0.57 ($0.46) $17.19 $17.23 $0.03 $17.13 $17.12 $17.07 ($0.06) ($0.13) ($0.05) 6/30/2024 Q2'24 6/30/24 Q3'24 Q3'24 Q3'24 Q3'24 NAV Q3'24 Q3'24 9/30/24 Q3'24 9/30/24 Supplemental Adjusted NAV 1 Adjusted Net Reversal of Reversal of Net Base Dividend Before
Slide 9: Operating Results Detail
OPERATING RESULTS DETAIL DOLLAR AMOUNTS IN THOUSANDS Except Per Share Data; Per Share Data is Based on Weighted Average Shares Outstanding During the Period, Except as Otherwise Noted For Three Months Ended September 30, 2023 December 31, 2023 March 31, 2024 June 30, 2024 September 30, 2024 Investme
Slide 10: Portfolio Highlights – Funding Activity
PORTFOLIO HIGHLIGHTS – FUNDING ACTIVITY Q3’24 Commitments and Net Funding • New investment commitments and fundings totaled $269.3 million and $189.0 million, respectively. The fundings were distributed across 8 new portfolio companies and 4 upsizes to existing portfolio companies • Paydowns and sal
Slide 11: Portfolio Highlights – Asset Mix
PORTFOLIO HIGHLIGHTS – ASSET MIX New Investment Fundings End of Period Investments $ Millions by Par Value $ Millions by Fair Value First Lien Second Lien Structured Credit First Lien Second Lien Structured Credit Mezzanine Equity & Other Mezzanine Equity & Other $152 $278 $163 $164 $189 $3,089 $3,1
Slide 12: Portfolio Highlights – Diversification Across Borrowers & Industries
PORTFOLIO HIGHLIGHTS – DIVERSIFICATION ACROSS BORROWERS & INDUSTRIES Top 10 Borrower Diversification Industry Diversification Merative L.P. TRP Assets LLC Internet Services Business Services Bcto Ace Purchaser Inc (HST Pathways) ExtraHop Networks, Inc. Human Resource Support Services Financial Servi
Slide 13: Portfolio Highlights – Net Interest Margin Analysis
PORTFOLIO HIGHLIGHTS – NET INTEREST MARGIN ANALYSIS Net Interest Margin Weighted Average Total Yield on Debt and Income Producing Securities at Amortized Cost 1 Weighted Average Interest Rate of Debt and Income Producing Securities at Fair Value Weighted Average Spread Over Reference Rate of All Flo
Slide 14: Liquidity Management
LIQUIDITY MANAGEMENT CASH AND CASH EQUIVALENTS Unrestricted Cash Totaled $6.5 Million as of September 30, 2024. Restricted Cash Related to Interest Rate Swaps Totaled $23.2 Million 1 Revolving Credit Facility Unsecured Notes* $1.7 Billion Committed; Uncommitted Accordion Size: $348 Million $300 Mill
Slide 15: Strong Liquidity and Funding Profile
STRONG LIQUIDITY AND FUNDING PROFILE CAPITAL & LIQUIDITY ROBUST BALANCE SHEET* LIQUIDITY VS. NEAR-TERM OBLIGATIONS* ($ in Millions) As of September 30, 2024 / $ Millions Near-term Obligations $6.5 Cash $1,094 Total Liquidity: $ 1,087 Undrawn Revolver $1,0942 Capacity1 $348 $226 $610 Secured Revolver
Slide 16: Distribution Information Since IPO
DISTRIBUTION INFORMATION SINCE IPO Date Declared Record Date Payment Date Amount Per Share March 26, 2014 March 31, 2014 April 30, 2014 $0.38 May 6, 2014 June 30, 2014 July 31, 2014 $0.38 August 4, 2014 September 30, 2014 October 31, 2014 $0.38 November 3, 2014 December 31, 2014 January 30, 2015 $0.
Slide 17: Distribution Information Since IPO (Continued)
DISTRIBUTION INFORMATION SINCE IPO (CONTINUED) Date Declared Record Date Payment Date Amount Per Share February 17, 2021 (Q4’20 Supplemental) February 26, 2021 March 31, 2021 $0.05 February 17, 2021 March 15, 2021 April 15, 2021 $0.41 February 17, 2021 (Special) March 25, 2021 April 8, 2021 $1.25 Ma
Slide 18: Footnotes
FOOTNOTES Slide 3: Overview 1. Reflects NAV per share adjusted for the supplemental dividend per share related to Q3 2024 earnings 2. Moody’s rating affirmed 9/23/2024; S&P rating affirmed on 1/23/2024; Fitch rating updated on 3/26/2024; KBRA affirmed 6/3/2024 Slide 4: Highlights 1. Represents our c
Slide 19: Footnotes
FOOTNOTES Slide 14: Liquidity Management 1. Includes $25 million of non-extending commitments with a maturity of February 4, 2026 and a revolving period ending February 4, 2025 and $170 million of non-extending commitments with a maturity of April 23, 2027 and a revolving period ending April 24, 202
Slide 20: Contact Us
CONTACT US: TSLX Investor Relations IRTSLX@sixthstreet.com (469) 621-2033 VISIT US: www.sixthstreetspecialtylending.com 20 SIXTH STREET SPECIALTY LENDING
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