Oaktree Specialty Lending Corp. Files 10-Q

TL;DR

**OCSL 10-Q filed. Fiscal year ends Sept 30. Formerly Fifth Street Finance.**

AI Summary

Oaktree Specialty Lending Corp. reported its financial results for the period ending June 30, 2024. The company's filing indicates a fiscal year end of September 30. Oaktree Specialty Lending Corp. was formerly known as Fifth Street Finance Corp. and changed its name on September 26, 2013.

Why It Matters

This filing provides investors with an update on Oaktree Specialty Lending Corp.'s financial performance and position as of June 30, 2024.

Risk Assessment

Risk Level: low — This is a standard quarterly financial filing (10-Q) with no immediate red flags.

Key Numbers

• 33.33 — Fiscal Year End (The company's fiscal year concludes on September 30.)

Key Players & Entities

• Oaktree Specialty Lending Corp. (company) — Filer of the 10-Q
• June 30, 2024 (date) — End of reporting period
• September 30 (date) — Fiscal year end
• Fifth Street Finance Corp. (company) — Former name of Oaktree Specialty Lending Corp.
• September 26, 2013 (date) — Date of name change

FAQ

Key Financial Figures

• $0.01 — ich Registered Common Stock, par value $0.01 per share OCSL The Nasdaq Stock Market

Filing Documents

• ocsl-20240630.htm (10-Q) — 7902KB
• ocsl-ex311_06302024x10xq.htm (EX-31.1) — 8KB
• ocsl-ex312_06302024x10xq.htm (EX-31.2) — 8KB
• ocsl-ex321_06302024x10xq.htm (EX-32.1) — 5KB
• ocsl-ex322_06302024x10xq.htm (EX-32.2) — 5KB
• 0001414932-24-000012.txt ( ) — 43792KB
• ocsl-20240630.xsd (EX-101.SCH) — 96KB
• ocsl-20240630_cal.xml (EX-101.CAL) — 89KB
• ocsl-20240630_def.xml (EX-101.DEF) — 568KB
• ocsl-20240630_lab.xml (EX-101.LAB) — 869KB
• ocsl-20240630_pre.xml (EX-101.PRE) — 704KB
• ocsl-20240630_htm.xml (XML) — 9354KB

— FINANCIAL INFORMATION

PART I — FINANCIAL INFORMATION Item 1. Consolidated Financial Statements: Consolidated Statements of Assets and Liabilities as of June 30, 2024 (unaudited) and September 30, 2023 2 Consolidated Statements of Operations (unaudited) for the three and nine months ended June 30, 2024 and 2023 3 Consolidated Statements of Changes in Net Assets (unaudited) for the three and nine months ended June 30, 2024 and 2023 4 Consolidated Statements of Cash Flows (unaudited) for the nine months ended June 30, 2024 and 2023 5 Consolidated Schedule of Investments (unaudited) as of June 30, 2024 6 Consolidated Schedule of Investments as of September 30, 2023 17

Notes to Consolidated Financial Statements (unaudited)

Notes to Consolidated Financial Statements (unaudited) 26 Item 2.

Management's Discussion and Analysis of Financial Condition and Results of Operations

Management's Discussion and Analysis of Financial Condition and Results of Operations 81 Item 3.

Quantitative and Qualitative Disclosures about Market Risk

Quantitative and Qualitative Disclosures about Market Risk 100 Item 4.

Controls and Procedures

Controls and Procedures 102

— OTHER INFORMATION

PART II — OTHER INFORMATION Item 1.

Legal Proceedings

Legal Proceedings 102 Item 1A.

Risk Factors

Risk Factors 102 Item 2. Unregistered Sales of Equity Securities and Use of Proceeds 102 Item 3. Defaults Upon Senior Securities 102 Item 4. Mine Safety Disclosures 102 Item 5. Other Information 102 Item 6. Exhibits 103

Consolidated Financial Statements

Item 1. Consolidated Financial Statements. Oaktree Specialty Lending Corporation Consolidated Statements of Assets and Liabilities (in thousands, except per share amounts) June 30, 2024 (unaudited) September 30, 2023 ASSETS Investments at fair value: Control investments (cost June 30, 2024: $ 369,660 ; cost September 30, 2023: $ 345,245 ) $ 299,072 $ 297,091 Affiliate investments (cost June 30, 2024: $ 38,101 ; cost September 30, 2023: $ 24,898 ) 35,396 23,349 Non-control/Non-affiliate investments (cost June 30, 2024: $ 2,885,171 ; cost September 30, 2023: $ 2,673,976 ) 2,787,235 2,571,980 Total investments at fair value (cost June 30, 2024: $ 3,292,932 ; cost September 30, 2023: $ 3,044,119 ) 3,121,703 2,892,420 Cash and cash equivalents 96,321 136,450 Restricted cash 10,993 9,089 Interest, dividends and fees receivable 27,609 44,570 Due from portfolio companies 954 6,317 Receivables from unsettled transactions 18,760 55,441 Due from broker 30,310 54,260 Deferred financing costs 12,418 12,541 Deferred offering costs 78 160 Derivative assets at fair value 436 4,910 Other assets 2,599 1,681 Total assets $ 3,322,181 $ 3,217,839 LIABILITIES AND NET ASSETS Liabilities: Accounts payable, accrued expenses and other liabilities $ 4,070 $ 2,950 Base management fee and incentive fee payable 15,415 19,547 Due to affiliate 4,803 4,310 Interest payable 19,329 16,007 Payables from unsettled transactions 51,595 11,006 Derivative liabilities at fair value 33,672 47,519 Deferred tax liability — 5 Credit facilities payable 790,000 710,000 Unsecured notes payable (net of $ 5,468 and $ 7,076 of unamortized financing costs as of June 30, 2024 and September 30, 2023, respectively) 907,164 890,731 Total liabilities 1,826,048 1,702,075 Commitments and contingencies (Note 13) Net assets: Common stock, $ 0.01 par value per share, 250,000 shares authorized; 82,245 and 77,225 shares issued and outstanding as of June 30, 2024 and September 30, 2023, r

incentive fee 8,341 9,590 25,821 26,300

Part I incentive fee 8,341 9,590 25,821 26,300 Professional fees 1,091 1,387 3,808 4,962 Directors fees 160 160 480 480 Interest expense 32,513 30,793 96,564 79,316 Administrator expense 391 322 1,083 935 General and administrative expenses 824 752 1,941 2,753 Total expenses 55,101 54,987 164,559 148,129 Management fees waived ( 1,500 ) ( 1,500 ) ( 4,500 ) ( 4,025 )

incentive fees waived ( 3,210 ) — ( 3,210 ) —

Part I incentive fees waived ( 3,210 ) — ( 3,210 ) — Net expenses 50,391 53,487 156,849 144,104 Net investment income before taxes 44,575 48,413 130,131 133,277 Excise tax — — — ( 78 ) Net investment income 44,575 48,413 130,131 133,199 Unrealized appreciation (depreciation): Control investments ( 17,580 ) 734 ( 22,434 ) ( 900 ) Affiliate investments ( 324 ) 149 ( 1,156 ) ( 302 ) Non-control/Non-affiliate investments 42,997 ( 6,497 ) 3,986 ( 36,296 ) Foreign currency forward contracts 1,106 4,575 ( 4,474 ) ( 4,802 ) Net unrealized appreciation (depreciation) 26,199 ( 1,039 ) ( 24,078 ) ( 42,300 ) Realized gains (losses): Control investments — — 786 — Non-control/Non-affiliate investments ( 69,163 ) ( 4,294 ) ( 87,936 ) ( 14,404 ) Foreign currency forward contracts ( 289 ) ( 6,309 ) 2,642 ( 5,513 ) Net realized gains (losses) ( 69,452 ) ( 10,603 ) ( 84,508 ) ( 19,917 ) (Provision) benefit for taxes on realized and unrealized gains (losses) ( 202 ) ( 86 ) ( 553 ) 397 Net realized and unrealized gains (losses), net of taxes ( 43,455 ) ( 11,728 ) ( 109,139 ) ( 61,820 ) Net increase (decrease) in net assets resulting from operations $ 1,120 $ 36,685 $ 20,992 $ 71,379 Net investment income per common share — basic and diluted (1) $ 0.54 $ 0.63 $ 1.63 $ 1.89 Earnings (loss) per common share — basic and diluted (Note 5) (1) $ 0.01 $ 0.48 $ 0.26 $ 1.01 Weighted average common shares outstanding — basic and diluted (1) 81,830 77,080 79,804 70,431 __________ (1) As discussed in Note 2, the Company completed a 1-for-3 reverse stock split on January 20, 2023, effective as of the commencement of trading on January 23, 2023. The weighted average common shares outstanding and per share information reflect the reverse stock split on a retroactive basis as necessary. See notes to Consolidated Financial Statements. 3 Oaktree Specialty Lending Corporation Consolidated Statements of Changes in Net Assets (in thousands, except per share amounts) (unaudited

View Full Filing

View this 10-Q filing on SEC EDGAR