Oaktree Specialty Lending Corporation

Welcome and thank you for joining Oak Tree Specialty Lending Corporation's first fiscal quarter 2026 conference call. Today's conference call is being recorded. I'll now turn the call over to Allison Meermey, OCFL's Head of Investor Relations.

Our first quarter 2026 earnings release, which we issued this morning, along with the accompanying slide presentation, can be accessed on the investor section of our website, OaktreeSpecialtyLending.com. Before we begin, I want to remind you that the comments on today's call include forward-looking statements reflecting current views with respect to, among other things, future operating results and financial performance. Actual results could differ materially from those implied or expressed in the forward-looking statement. Please refer to the relevant SEC filing for a discussion of these factors in further detail. Oaktree undertakes no duty to update or revise any forward-looking statements. I'd also like to remind you that nothing on this call constitutes an offer to sell or solicitation of an offer to purchase any interest in an Oaktree fund. Investors and others should note that OCSL uses the investor section of its corporate website to announce material information. The company encourages investors, the media, and others to review information that it shares on its website. Now I'll turn the call over to Matt Pendo, president of OCSL. Matt.

Thanks, Allison, and good morning, everyone. I'll begin the call with an overview of our first quarter results. Armin Pinozian, our CEO and co-CIO, will then share some commentary on the current market environment. And Raghav Khanna, our co-CIO, provide details on our portfolio and investment activity. Our CFO and Treasurer, Chris McCown, will then review our financial performance before we open the call for questions. This year is off to a good start, and we delivered solid results for the first fiscal quarter of 2026. Adjusted net invested income for the quarter was $36.1 million, or 41 cents per share, up modestly from the prior quarter. Once again, we fully covered our quarterly dividend with earnings. These results reflect our team's disciplined capital deployment into income-generating assets, as well as the actions we took last year to optimize the liability side of our balance sheet. Importantly, this was the first full quarter reflecting the impact of the September rate cut, and despite lower base rates, earnings remained stable. Consistent with our dividend policy and first quarter earnings, our board declared a quarterly cash dividend of 40 cents per share, payable on March 31, 2026, to stockholders as a record as of March 16, 2026. As discussed on our fiscal 2025 year-end call, we have several levers to help offset lower base rates and support net investment income. One of the key levers is our ability to prudently deploy capital into attractive investment opportunities. To that point, New fund investments, including drawdowns from existing commitments, totaled $314 million, up from $220 million in the prior quarter. The average all-in spread and yield of new private investments was 525 basis points and 9% respectively. We have ample financial flexibility to continue deploying capital as we enter the quarter with over $576 million available liquidity. We are intensely focused on reducing non-accruals and equity positions as another key lever for improving earnings power. In the first quarter, non-accruals were relatively stable sequentially and down nearly 85 basis points year over year. At quarter end, non-accruals represented 3.1% of the total debt portfolio measured at fair value. For several of our non-accrual positions, we are optimistic about the potential outcomes and are actively working to maximize recovery value. This quarter, we restructured our investment in Avery and put a portion of the loan back on accrual status, which is consistent with the broader objective of converting non-earning assets into income-producing assets. Avery continues to sell units, and it appears to be happening at an increased pace. Any proceeds from monetization of non-accruals or equity positions will be reinvested into income-generating investments. We will continue to evaluate these levers and their potential contribution to our earnings and dividends. As always, we remain committed to strong alignment with our shareholders as we navigate an evolving credit landscape. Now, I'll turn the call over to Armen for an update on the market environment.