Sixth Street Specialty Lending, Inc. · NYSE:TSLX
Sixth Street Specialty Lending — Q3 2023 Earnings Presentation
19 slides from Sixth Street Specialty Lending's earnings presentation, Nov 3, 2023
Slide 1: Sixth Street Specialty Lending Earnings Presentation
SIXTH STREET SPECIALTY LENDING EARNINGS PRESENTATION Quarter Ended September 30, 2023
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
OVERVIEW SPECIALTY LENDING COMPANY FOCUSED ON PROVIDING FINANCING SOLUTIO NS $39.05 $38.30 $37.65 $36.99 $36.42 $35.66$35.50 $35.10 $34.46 $33.70 $32.85 $31.83 $31.03 $29.58 $29.22 $28.64 $28.41 $28.17 19.83 $27.43 19.31 18.81 $26.61$26.83 17.8118.26 $26.03 16.0116.5316.98 $25.49 15.53 $24.89 15.10
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: $69 million(1) Scaled Senior Floating • Target investment hold size of $30 million to $100 million Rate-focused Por
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 2022 Q4 2022 Q1 2023 Q2 2023 Q3 2023 Net Investment Income Per Share $0.47 $0.65 $0.53 $0.58 $0.57 Net Income (Loss)
Slide 6: Portfolio Highlights – Selected Metrics
PORTFOLIO HIGHLIGHTS – SELECTED METRICS DOLLAR AMOUNTS IN THOUSANDS September 30, 2022 December 31, 2022 March 31, 2023 June 30, 2023 September 30, 2023 Investments at Fair Value $2,806,063 $2,787,925 $2,918,584 $3,088,987 $3,113,277 Number of Portfolio Companies 118 121 127 130 131 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, 2022 December 31, 2022 March 31, 2023 June 30, 2023 September 30, 2023 Assets Investments at Fair Value $2,806,063 $2,787,925 $2,918,584 $
Slide 8: Net Asset Value Bridge – Q3'23
NET ASSET VALUE BRIDGE – Q3’23 ($0.03) $0.06 $16.97 $0.60 ($0.46) ($0.08) $16.90 $16.74 $16.68 $16.79 $0.20 ($0.07) ($0.06) 6/30/23 Q2'23 6/30/23 Q3'23 Q3'23 Q3'23 NAV Q3'23 Q3'23 Q3'23 9/30/23 Q3'23 9/30/23 NAV Supplemental Adjusted NAV* Adjusted Net Accrued Capital Base Dividend Before Net Unreali
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, 2022 December 31, 2022 March 31, 2023 June 30, 2023 September 30, 2023 Investme
Slide 10: Portfolio Highlights – Funding Activity
PORTFOLIO HIGHLIGHTS – FUNDING ACTIVITY (Dollar amounts in millions) Q3’23 COMMITMENTS AND NET FUNDING • New investment commitments and fundings totaled $205.8 and $151.6, respectively. The fundings were distributed across 8 new portfolio companies and 2 upsizes to existing portfolio companies • Pay
Slide 11: Portfolio Highlights – Asset Mix
PORTFOLIO HIGHLIGHTS – ASSET MIX NEW INVESTMENT FUNDINGS END OF PERIOD INVESTMENTS At Par Value | $ Millions At Fair Value | $ Millions First Lien Second Lien Structured Credit First Lien Second Lien Structured Credit Mezzanine Equity & Other Mezzanine Equity & Other $274 $212 $139 $240 $152 $2,806
Slide 12: Portfolio Highlights – Diversification Across Borrowers & Industries
PORTFOLIO HIGHLIGHTS – DIVERSIFICATION ACROSS BORROWERS & INDUSTRIES TOP 10 BORROWER DIVERSIFICATION INDUSTRY DIVERSIFICATION Merative LP (IBM Watson) TRP Assets LLC Internet Services Business Services ReliaQuest, LLC BCTO Ace Purchaser, Inc. Retail and consumer products Human Resource Support Servi
Slide 13: Portfolio Highlights – Net Interest Margin Analysis
PORTFOLIO HIGHLIGHTS – NET INTEREST MARGIN ANALYSIS (6) Weighted Average Total Yield on Debt and Income Producing Securities at Amortized Cost Weighted Average Interest Rate of Debt and Income Producing Securities at Fair Value Weighted Average Spread Over Reference Rate of All Floating Rate Investm
Slide 14: Liquidity Management
LIQUIDITY MANAGEMENT CASH AND CASH EQUIVALENTS Unrestricted Cash Totaled $3.0 Million as of September 30, 2023. Restricted Cash Related to Interest Rate Swaps Totaled $26.9 Million (18) Revolving Credit Facility Unsecured Notes $1.710 Billion Committed; Uncommitted Size: $348 Million $300 Million $3
Slide 15: Funding Profile
FUNDING PROFILE STABLE FUNDING PROFILE DEBT PORTFOLIO COMPOSITION* DEBT FUNDING COMPOSITION Fixed Rate 0.3% Floating Rate (16) 100% Floating Rate 99.7% PORTFOLIO FUNDING INVESTMENTS FUNDED REMAINING TIME TO MATURITY OF DEBT PROFILE ( 3) WITH DEBT 2028 Unsecured Notes (4-5 years) 11% 4-5 Years 2026 U
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: Endnotes
ENDNOTES Note: Figures are as of 9/30/23 quarter end unless otherwise noted (1) Represents our core portfolio, which excludes structured credit investments and certain investments that fall outside of our typical borrower profile. EBITDA is defined as earnings before interest, tax, depreciation and
Slide 19: Contact Us
CONTACT US: TSLX Investor Relations IRTSLX@sixthstreet.com (469) 621-2033 VISIT US: www.sixthstreetspecialtylending.com 19 SIXTH STREET SPECIALTY LENDING
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