Kennedy Lewis Capital's Net Investment Income Nearly Doubles

TL;DR

**Kennedy Lewis Capital is on a tear, doubling net investment income and growing assets by over 30% in six months – buy the dip if you can find it!**

AI Summary

Kennedy Lewis Capital Co reported a significant increase in net investment income for the three months ended June 30, 2025, reaching $14,626,034, up from $7,417,493 in the prior year, a 97.2% increase. For the six months ended June 30, 2025, net investment income more than doubled to $26,920,654 from $12,776,694 in 2024. Total assets grew substantially to $1,073,730,780 as of June 30, 2025, from $819,107,893 at December 31, 2024, driven by an increase in investments at fair value to $999,153,778 from $756,523,331. Liabilities also increased, with the Secured Credit Facility rising to $457,104,745 from $342,685,745. Net assets increased to $566,421,306 from $447,065,753. The company saw a net increase in net assets from operations of $18,058,673 for the three months ended June 30, 2025, compared to $6,878,896 for the same period in 2024. Proceeds from the issuance of common shares for Class I totaled $91,754,996 for the six months ended June 30, 2025.

Why It Matters

This strong performance in net investment income and asset growth signals robust operational health for Kennedy Lewis Capital Co, which is crucial for investors seeking yield and capital appreciation. The substantial increase in the Secured Credit Facility, while supporting asset growth, also indicates increased leverage, a factor investors should monitor. For employees, continued growth could mean job stability and expansion opportunities. Customers benefit from a financially strong partner, while the broader market sees a dynamic player in the investment landscape, potentially intensifying competition in the private credit and alternative investment sectors.

Risk Assessment

Risk Level: medium — The company's total liabilities increased significantly to $507,309,474 at June 30, 2025, from $372,042,140 at December 31, 2024, representing a 36.3% increase. This includes a substantial rise in the Secured Credit Facility to $457,104,745 from $342,685,745, indicating increased leverage which could amplify losses in a downturn.

Analyst Insight

Investors should closely monitor Kennedy Lewis Capital Co's leverage ratios and the quality of its investment portfolio, particularly given the significant increase in the Secured Credit Facility. While growth is strong, assess the underlying credit quality of new investments to ensure sustainable returns.

Financial Highlights

debt To Equity

0.81

total Assets

$1,073,730,780

total Debt

$457,104,745

net Income

$14,626,034

cash Position

$17,502,873

Key Numbers

• $14.6M — Net Investment Income (Q2 2025) (Increased 97.2% from $7.4M in Q2 2024)
• $26.9M — Net Investment Income (YTD Q2 2025) (More than doubled from $12.8M in YTD Q2 2024)
• $1.07B — Total Assets (Increased from $819.1M at Dec 31, 2024)
• $999.2M — Investments at Fair Value (Increased from $756.5M at Dec 31, 2024)
• $457.1M — Secured Credit Facility (Increased from $342.7M at Dec 31, 2024, indicating higher leverage)
• $566.4M — Total Net Assets (Increased from $447.1M at Dec 31, 2024)
• $18.1M — Net Increase in Net Assets from Operations (Q2 2025) (Up from $6.9M in Q2 2024)
• $91.8M — Proceeds from Class I Share Issuance (YTD Q2 2025) (Significant capital inflow)
• 28,060,980 — Class I Common Shares Outstanding (As of August 12, 2025)
• $20.19 — Net Asset Value per Class I Share (As of June 30, 2025, a slight decrease from $20.22 at Dec 31, 2024)

Key Players & Entities

• Kennedy Lewis Capital Co (company) — Registrant
• Securities and Exchange Commission (regulator) — Filing oversight
• $14,626,034 (dollar_amount) — Net investment income for Q2 2025
• $7,417,493 (dollar_amount) — Net investment income for Q2 2024
• $1,073,730,780 (dollar_amount) — Total assets at June 30, 2025
• $819,107,893 (dollar_amount) — Total assets at December 31, 2024
• $457,104,745 (dollar_amount) — Secured Credit Facility at June 30, 2025
• $342,685,745 (dollar_amount) — Secured Credit Facility at December 31, 2024
• $566,421,306 (dollar_amount) — Total net assets at June 30, 2025
• $91,754,996 (dollar_amount) — Proceeds from issuance of Class I common shares for six months ended June 30, 2025

FAQ

Industry Context

Kennedy Lewis Capital Co operates in the alternative investment management sector, focusing on credit strategies. The industry is characterized by increasing demand for yield-oriented investments and a competitive landscape with numerous firms vying for capital. Companies like KLC often utilize leverage to enhance returns, making interest rate environments and credit market conditions critical factors.

Regulatory Implications

As a registered investment advisor, Kennedy Lewis Capital Co is subject to regulations by the SEC, including rules on disclosure, fiduciary duty, and capital requirements. Compliance with these regulations is crucial to maintain investor trust and operational integrity. Changes in financial regulations or increased scrutiny on credit funds could impact operational costs and investment strategies.

What Investors Should Do

1. Monitor the utilization and cost of the increased Secured Credit Facility ($457.1M) to ensure leverage is being deployed effectively and sustainably.
2. Analyze the drivers behind the slight decrease in Net Asset Value per Class I Share ($20.19) despite significant growth in total net assets, particularly in relation to the substantial Class I share issuance ($91.8M).
3. Evaluate the sustainability of the 97.2% increase in Net Investment Income ($14.6M) and assess whether it is driven by recurring income or one-time events.
4. Assess the company's ability to manage increased operational scale and potential market risks associated with its expanded investment portfolio and leverage.

Key Dates

• 2025-06-30: End of Second Quarter 2025 — Reported net investment income of $14,626,034 and total assets of $1,073,730,780. Net asset value per Class I share was $20.19.
• 2025-12-31: End of Fiscal Year 2024 — Reported total assets of $819,107,893 and net asset value per Class I share of $20.22.

Glossary

Net Investment Income

The income generated from a company's investments after deducting operating expenses, excluding any capital gains or losses. (Key measure of profitability from core investment activities, showing a significant increase of 97.2% year-over-year for Q2 2025.)

Investments at fair value

Assets held by the company that are valued based on their current market price. (Represents the largest asset class, growing from $756.5M to $999.2M, indicating expansion of the investment portfolio.)

Secured Credit Facility

A type of loan that is backed by specific assets of the borrower, which can be seized by the lender if the borrower defaults. (The primary source of debt financing, increasing to $457.1M, suggesting increased leverage to fund asset growth.)

Net Assets

The total value of a company's assets minus its total liabilities; also known as shareholders' equity. (Represents the owners' stake in the company, which grew to $566.4M, reflecting positive operational performance and capital inflows.)

Net Asset Value per Share

The market value of a company's assets minus its liabilities, divided by the number of outstanding shares. (Indicates the per-share value of the company's holdings. For Class I shares, it slightly decreased from $20.22 to $20.19 despite overall growth, possibly due to share issuance.)

Additional paid in capital

The amount of money that shareholders have paid for stock above its par or stated value. (Significantly increased to $566.2M from $443.9M, driven by the $91.8M proceeds from Class I share issuance, indicating substantial capital raising.)

Year-Over-Year Comparison

Kennedy Lewis Capital Co has demonstrated robust growth compared to the prior year. Total assets surged by approximately 31% from $819.1M to $1.07B, primarily driven by a 32% increase in investments at fair value. Net investment income more than doubled, with Q2 2025 at $14.6M versus $7.4M in Q2 2024, and year-to-date income reaching $26.9M compared to $12.8M. This growth was supported by significant capital inflows, including $91.8M from Class I share issuances, and an increased reliance on debt financing, evidenced by the Secured Credit Facility rising by 33% to $457.1M. Despite this expansion, the Net Asset Value per Class I Share saw a marginal decrease from $20.22 to $20.19.

Key Financial Figures

• $0.01 — s common shares of beneficial interest, $0.01 par value per share ("Common Shares"),

Filing Documents

• ck0001911321-20250630.htm (10-Q) — 9338KB
• ck0001911321-ex31_1.htm (EX-31.1) — 14KB
• ck0001911321-ex31_2.htm (EX-31.2) — 15KB
• ck0001911321-ex32_1.htm (EX-32.1) — 10KB
• ck0001911321-ex32_2.htm (EX-32.2) — 9KB
• 0000950170-25-107192.txt ( ) — 29236KB
• ck0001911321-20250630.xsd (EX-101.SCH) — 2097KB
• ck0001911321-20250630_htm.xml (XML) — 7317KB

—FINANCIAL INFORMATION

PART I—FINANCIAL INFORMATION 2 Item 1.

Financial Statements

Financial Statements 2 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 54 Item 3.

Quantitative and Qualitative Disclosures About Market Risk

Quantitative and Qualitative Disclosures About Market Risk 65 Item 4.

Controls and Procedures

Controls and Procedures 65

—OTHER INFORMATION

PART II—OTHER INFORMATION 66 Item 1.

Legal Proceedings

Legal Proceedings 66 Item 1A.

Risk Factors

Risk Factors 66 Item 2. Unregistered Sales of Equity Securities and Use of Proceeds 66 Item 3. Defaults upon Senior Securities 66 Item 4. Mine Safety Disclosures 66 Item 5. Other Information 66 Item 6. Exhibits 67

—FINANCIAL INFORMATION

PART I—FINANCIAL INFORMATION

. FINANCIAL STATEMENTS

ITEM 1 . FINANCIAL STATEMENTS Kennedy Lewis Capital Company Consolidated Statements of Assets and Liabilities June 30, 2025 (Unaudited) December 31, 2024 Assets Investments at fair value Non-controlled/non-affiliated investments (cost of $ 993,128,586 and $ 751,106,426 at June 30, 2025 and December 31, 2024, respectively) $ 999,153,778 $ 756,523,331 Cash and cash equivalents 17,502,873 13,437,972 Restricted cash and cash equivalents 34,502,151 24,305,322 Interest and fee receivable from non-controlled/non-affiliated investments 5,597,295 5,355,626 Deferred financing costs (net of $ 1,600,573 and $ 1,234,121 in accumulated amortization at June 30, 2025 and December 31, 2024, respectively) 3,925,103 4,291,555 Deferred offering costs (net of $ 2,743,184 and $ 2,270,968 in accumulated amortization at June 30, 2025 and December 31, 2024, respectively) 249,353 420,856 Receivable for investments sold 12,615,892 14,323,332 Derivative assets at fair value (Note 5) — 319,195 Due from Advisor — 74,454 Other assets 184,335 56,250 Total assets $ 1,073,730,780 $ 819,107,893 Liabilities Secured Credit Facility (Note 6) 457,104,745 342,685,745 Distribution Payable — 13,468,268 Payable for investments purchased 36,441,663 5,529,326 Interest and credit facility fees payable 4,956,309 3,997,833 Income incentive fee payable 2,095,341 1,434,404 Management fees payable 1,691,115 1,317,398 Deferred financing cost payable 1,500,000 1,500,000 Accrued capital gains incentive fee 1,139,704 1,049,209 Derivative liabilities at fair value (Note 5) 733,825 — Due to Advisor and affiliates 266,046 270,203 Offering costs payable 47,849 7,440 Accrued expenses and other liabilities 1,332,877 782,314 Total liabilities $ 507,309,474 $ 372,042,140 Commitments and contingencies (Note 7) Net Assets Common shares, $ 0.01 par value ( 2

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