Sixth Street Specialty Lending, Inc.

Good day and thank you for standing by. Welcome to the Sixth Street Specialty Lending Inc. Q3 2025 earnings conference call. At this time, all participants are in a listen-only mode. After the speaker's presentation, there will be a question-and-answer session. To ask a question during the session, you will need to press star 1-1 on your telephone. You will then hear an automated message advising that your hand is raised. To withdraw your question, please press star 1-1 again. Please be advised that today's conference is being recorded. I would now like to hand the conference over to your first speaker today, Cami Van Horn, Head of Investor Relations. Please go ahead.

Thank you. Before we begin today's call, I would like to remind our listeners that remarks made during the call may contain forward-looking statements. Statements other than statements of historical facts made during this call may constitute forward-looking statements and are not guarantees of future performance or results and involve a number of risks and uncertainties. Actual results may differ materially from those in the forward-looking statements as a result of a number of factors, including those described from time to time in Sixth Street Specialty Lending Inc's filings with the Securities and Exchange Commission. The company assumes no obligation to update any such forward-looking statements. Yesterday, after the market closed, We issued our earnings press release for the third quarter ended September 30th, 2025, and posted a presentation to the investor resources section of our website, www.sixthstreetspecialtylending.com. The presentation should be reviewed in conjunction with our form 10Q filed yesterday with the SEC. Sixth Street Specialty Lending, Inc.' 's earnings release is also available on our website under the investor resources section. Unless noted otherwise, all performance figures mentioned in today's prepared remarks are as of and for the third quarter ended September 30th, 2025. As a reminder, this call is being recorded for replay purposes. I will now turn the call over to Joshua Easterly, Co-Chief Executive Officer of Sixth Street Specialty Lending, Inc.

Good morning, everyone, and thank you for joining us. I assume everybody has seen my most recent letter in the 8K posted last night with our earnings. I'm joined by our newly announced co-CEO, Bo Stanley, and our CFO, Ian Simmons. Before covering our Q3 2025 results, I wanted to discuss the leadership changes that were announced yesterday. We are excited to announce that Bo has been named co-CEO, effective immediately. Bo and I have been working together for the better part of the past 25 years. As an early member of the 6th Street team, Bo possesses an unparalleled understanding of our industry, is a tremendous leader and investor. As a key member of the management team, Bo has also been a driving force in preserving and strengthening the investor-first mentality that defines the Sixth Street culture. After 15 years of leading the business and what is now my 47th public earnings call, I'll be stepping down from the CEO seat at the end of the year. This decision is made with considerable optimism for the future of the company. Bo has been integral in the investment leadership of the business for several years, and this transition formalizes our existing collaborative structure. Going forward, I'll continue to serve as chairman of SOX and co-president and co-chief investment officer of the broader 6G platform. As part of this evolution, Bo has joined SOX's board of directors. It has been a privilege over the lifetime to lead the company. I'm incredibly proud of what we have accomplished together and even more excited about what lies ahead under Bo's leadership. With that, let's turn to this quarter's results. After the market closed yesterday, we reported third quarter adjusted net investment income of 53 cents per share or an annualized return on equity of 12.3%, an adjusted net income of 46 cents per share or an annualized return on equity of 10.8%. As presented in our financial statements, our Q3 net investment income and net income per share, inclusive of the unwind of the non-cash accrued capital gain incentive fee expense, were a penny per share higher than the adjusted figures. The difference between adjusted net investment income and adjusted net income of 7 cents per share was largely related to the reversal of net unrealized gains in the balance sheet related to investment realizations. Yesterday, our board approved a base quarterly dividend of 46 cents per share at the shareholders of record as of December 15th, payable on December 31st. Our board also declared a supplemental dividend of 3 cents per share related to our Q3 earnings to shareholders of record as of November 28th, payable on December 19th. Net asset value per share adjusted for the impact of the supplemental dividend that was declared yesterday, $17.11. Since the start of the interest rate hiking cycle in early 2022, our net asset value per share has grown by 1.9%, representing a significant outperformance compared to the average decline of 8.5% for our public BDC peers through Q2. Focusing specifically on the last 12 months, this outperformance has continued, with SOS delivering NAV stability while other public BDC peers experienced an average decline of 2.8% through Q2. While dividend policies vary across industry, SOX's outperformance remains largely consistent, whether measured by reported net asset value per share or net asset value adjusted for supplemental and special dividends. Before passing it to Beau, I wanted to touch on one topic addressed in our letter, which is the stock market performance of the BDC sector. We view the September sell-off as a net positive for our industry. Let me be clear. We do not believe the market move is credit-related for us or the sector broadly. As we said in our last earnings call, we think credit issues are generally behind the industry. Our view is that the market woke up to the reality that the sector has been allocating capital based on a backward-looking view of higher-yielding backbooks in an elevated interest rate environment. This was the premise of our letter to shareholders in April, which illustrated four ROEs falling below the industry's cost of equity capital. While we believe this capital misallocation will have both near and long-term effects, in the short term, we expect to see dividend cuts across the industry as net investment income falls below dividend levels. For SOX, we continue to over-earn our base dividend with 114% coverage in Q3, allowing us to pay another supplemental dividend based on this quarter's over-earning. Long term, we believe downward pressure on BDC stocks will constrain further capital raising, specifically in the non-traded perpetually offered vehicles. For a number of managers, investors can simply buy the same or very similar product in a listed format at a discounted net asset value with daily liquidity. While this will take time to play out, we see this as an effective market correcting mechanism to addressing imbalance between supply and demand of capital that we have been talking about for several quarters. Ultimately, we believe this will create net negative flows for direct lending, similar to the experience in the listed and non-traded REIT products that occurred following the rate hiking cycle beginning in late 2022. There is more on this in my letter, but to wrap it up, we are optimistic that this environment will underscore the critical importance of manager selection in driving long-term shareholder value. With that, I'll now pass it over to Bo to discuss this quarter's investment activities.